Borrowings

9 Months Ended

Sep. 30, 2019

Disclosure Text Block

Borrowings

Note 17 – Borrowings

Assets sold under agreements to repurchase amounted $213 million at September 30, 2019 and $282 million December 31, 2018.

The Corporation’s repurchase transactions are overcollateralized with the securities detailed in the table below. The Corporation’s repurchase agreements have a right of set-off with the respective counterparty under the supplemental terms of the master repurchase agreements. In an event of default each party has a right of set-off against the other party for amounts owed in the related agreement and any other amount or obligation owed in respect of any other agreement or transaction between them. Pursuant to the Corporation’s accounting policy, the repurchase agreements are not offset with other repurchase agreements held with the same counterparty.

The following table presents information related to the Corporation’s repurchase transactions accounted for as secured borrowings that are collateralized with debt securities available-for-sale, other assets held-for-trading purposes or which have been obtained under agreements to resell. It is the Corporation’s policy to maintain effective control over assets sold under agreements to repurchase; accordingly, such securities continue to be carried on the Consolidated Statements of Financial Condition.

Repurchase agreements accounted for as secured borrowings

		September 30, 2019		December 31, 2018
			Repurchase		Repurchase
(In thousands)			liability		liability
U.S. Treasury securities
	Within 30 days	$	9,400	$	138,689
	After 30 to 90 days		29,386		79,374
	After 90 days		142,818		19,558
Total U.S. Treasury securities			181,604		237,621
Obligations of U.S. government sponsored entities
	After 30 to 90 days		-		6,055
Total obligations of U.S. government sponsored entities			-		6,055
Mortgage-backed securities
	Within 30 days		30,184		6,859
	After 90 days		-		20,465
Total mortgage-backed securities			30,184		27,324
Collateralized mortgage obligations
	Within 30 days		1,309		10,529
Total collateralized mortgage obligations			1,309		10,529
Total		$	213,097	$	281,529

Repurchase agreements in this portfolio are generally short-term, often overnight. As such our risk is very limited. We manage the liquidity risks arising from secured funding by sourcing funding globally from a diverse group of counterparties, providing a range of securities collateral and pursuing longer durations, when appropriate.

There were no other short-term borrowings outstanding at September 30, 2019, compared to $42 thousand at December 31, 2018.

The following table presents the composition of notes payable at September 30, 2019 and December 31, 2018.

(In thousands)	September 30, 2019		December 31, 2018
Advances with the FHLB with maturities ranging from 2019 through 2029 paying interest at monthly fixed rates ranging from 1.04% to 4.19%	$	472,355	$	524,052
Advances with the FHLB paying interest monthly at a floating rate		-		13,000
Advances with the FHLB maturing on 2019 paying interest quarterly at a floating rate of 0.24% over the 3 month LIBOR		14,430		19,724
Unsecured senior debt securities maturiting on 2023 paying interest semiannually at a fixed rate of 6.125%, net of debt issuance costs of $ 5,010		294,990		294,039
Junior subordinated deferrable interest debentures (related to trust preferred securities) with maturities ranging from 2033 to 2034 with fixed interest rates ranging from 6.125% to 6.7%, net of debt issuance costs of $402		384,895		384,875
Capital lease obligations		-		20,412
Total notes payable	$	1,166,670	$	1,256,102
Note: Refer to the Corporation's 2018 Form 10-K for rates information at December 31, 2018.

A breakdown of borrowings by contractual maturities at September 30, 2019 is included in the table below.

	Assets sold under
(In thousands)	agreements to repurchase		Notes payable		Total
2019	$	70,279	$	65,309	$	135,588
2020		142,818		139,996		282,814
2021		-		50,040		50,040
2022		-		103,148		103,148
2023		-		318,251		318,251
Later years		-		489,926		489,926
Total borrowings	$	213,097	$	1,166,670	$	1,379,767

At September 30, 2019 and December 31, 2018, the Corporation had FHLB borrowing facilities whereby the Corporation could borrow up to $3.7 billion and $3.4 billion, respectively, of which $0.5 billion and $0.6 billion, respectively, were used. In addition, at September 30, 2019 and December 31, 2018, the Corporation had placed $0.8 billion and $0.9 billion, respectively, of the available FHLB credit facility as collateral for a municipal letter of credit to secure deposits. The FHLB borrowing facilities are collateralized with LHIP, and do not have restrictive covenants or callable features.

Also, at September 30, 2019, the Corporation has a borrowing facility at the discount window of the Federal Reserve Bank of New York amounting to $1.1 billion (2018 - $1.2 billion), which remained unused at September 30, 2019 and December 31, 2018. The facility is a collateralized source of credit that is highly reliable even under difficult market conditions.