Borrowings

9 Months Ended

Sep. 30, 2023

Debt Disclosure [Abstract]

Borrowings

BORROWINGS

Federal Home Loan Bank Borrowings

During the nine months ended September 30, 2023, the Company began utilizing FHLB advances for certain short-term and long-term borrowing needs, as deemed necessary, which were comprised of the following as of September 30, 2023:

			Weighted
			Average		Effective Rate,
	Total		Contractual		Net of
	Outstanding		Rate		Hedges
	(Dollars in thousands)
Overnight Borrowings	$	287,000	5.57	%	n/a
1-Month Term	200,000		5.50	%	n/a
1-Month Term	400,000		5.51	%	3.87	%
Amortizing	548		1.40	%	n/a
Total	$	887,548

At September 30, 2023 and December 31, 2022, the Company had sufficient collateral at the FHLB to support its obligations and was in compliance with the FHLB's collateral pledging program. The Company’s FHLB advances are collateralized by a blanket pledge agreement on the Bank’s FHLB stock, certain qualified investment securities, deposits at the FHLB, residential mortgages, and by certain commercial real estate loans held in the Bank’s portfolio. The carrying value of loans pledged as collateral for these borrowings totaled $3.8 billion and $2.7 billion at September 30, 2023 and December 31, 2022, respectively, resulting in available borrowing capacity with the FHLB of $1.8 billion both September 30, 2023 and December 31, 2022

Long-Term Debt

The following table summarizes long-term debt, net of debt issuances costs, at the dates indicated:

	September 30		December 31
	2023		2022
	(Dollars in thousands)
Junior subordinated debentures
Capital Trust V	51,516		51,514
Central Trust I	5,258		5,258
Central Trust II	6,083		6,083
Subordinated debentures	49,957		49,885
Total long-term debt	$	112,814	$	112,740

The interest expense on long-term debt was $1.8 million and $5.0 million for the three and nine months ended September 30, 2023, respectively, and $1.2 million and $3.2 million for the three and nine months ended September 30, 2022, respectively.

Junior Subordinated Debentures: The junior subordinated debentures are issued to various trust subsidiaries of the Company. These trusts were formed for the purpose of issuing trust preferred securities, which were then sold in a private placement offering. The proceeds from the sale of the securities and the issuance of common stock by these trusts were invested in these Junior Subordinated Debentures issued by the Company. These trust preferred securities bear interest at a rate of three-month Secured Overnight Financing Rate ("SOFR") (5.41% at September 30, 2023) plus applicable spread.

Information relating to these trust preferred securities at September 30, 2023 is as follows:

Trust	Principal Amount		Maturity Date	Interest Rate Spread	All-in Rate
	(Dollars in thousands)
Capital Trust V	$	50,000	3/15/2037	1.48%	7.15%
Central Trust I (1)	$	5,100	9/16/2034	2.44%	8.11%
Central Trust II (1)	$	5,900	3/15/2037	1.65%	7.32%

(1)These securities noted above are callable quarterly until maturity.

Subordinated Debentures: On March 14, 2019 the Company issued subordinated debentures with an aggregate principal amount of $50.0 million in a private placement transaction to institutional accredited investors, which remained outstanding at September 30, 2023 and December 31, 2022. The subordinated debentures mature on March 15, 2029. However, with regulatory approval, the Company may redeem the subordinated debentures without penalty at any scheduled payment date on or after March 15, 2024 with 30 days' notice. The subordinated debentures carry a fixed rate of interest of 4.75% through March 15, 2024, after which interest converts to a variable rate of the then current three-month SOFR rate plus 219 basis points.

At September 30, 2023, the Company held no long-term debt scheduled to mature within the next 5 years.