Borrowings

12 Months Ended

Dec. 31, 2020

Debt Disclosure [Abstract]

Borrowings

9. BORROWINGS

Short-term borrowings consist of federal funds purchased, securities sold under repurchase agreements, and short-term FHLB advances with original maturities of one year or less. Short-term borrowings totaled $10.0 million as of both December 31, 2020 and 2019.  

Federal funds purchased, which represent unsecured lines of credit that generally mature within one to four days, are available to the Bank through arrangements with correspondent banks and the Federal Reserve. As of both December 31, 2020 and 2019, there were no federal funds purchased outstanding. The Bank had $51.4 million and $61.7 million in available unused lines of credit with correspondent banks and the Federal Reserve as of December 31, 2020 and 2019, respectively.

Securities sold under repurchase agreements, which are secured borrowings, generally are reflected at the amount of cash received in connection with the transaction. The Bank may be required to provide additional collateral based on the fair value of the underlying securities. The Bank monitors the fair value of the underlying securities on a daily basis. Securities sold under repurchase agreements as of December 31, 2020 and 2019 totaled $17 thousand and $25 thousand, respectively.

Short-term FHLB advances are secured borrowings available to the Bank as an alternative funding source. As of both December 31, 2020 and 2019, the Bank had $10.0 million in outstanding FHLB advances with original maturities of less than one year.

The Company may use FHLB advances with original maturities of more than one year as an alternative to funding sources with similar maturities, such as certificates of deposit or other deposit programs. These advances generally offer more attractive rates than other mid-term financing options. They are also flexible, allowing the Company to quickly obtain the necessary maturities and rates that best suit its overall asset/liability strategy. FHLB advances with an original maturity of more than one year are classified as long-term. The Company did not have any long-term FHLB advances or other long-term borrowings outstanding as of both December 31, 2020 and 2019.

Assets pledged (including loans and investment securities) associated with FHLB advances totaled $36.1 million and $34.6 million as of December 31, 2020 and 2019, respectively. As of December 31, 2020 and 2019, the Bank had $225.8 million and $211.5 million, respectively, in remaining credit from the FHLB (subject to available collateral).