Short and Long-Term Funding

12 Months Ended

Dec. 31, 2021

Debt Disclosure [Abstract]

Debt Disclosure [Text Block]

Short and Long-Term Funding

The following table presents the components of short-term funding (funding with original contractual maturities of one year or less), and long-term funding (funding with original contractual maturities greater than one year):

($ in Thousands)	December 31, 2021		December 31, 2020
Short-Term Funding
Federal funds purchased	$	120	$	7,070
Securities sold under agreements to repurchase	319,412		185,901
Federal funds purchased and securities sold under agreements to repurchase	319,532		192,971
Commercial paper	34,730		59,346
Total short-term funding	$	354,262	$	252,317
Long-Term Funding
Bank senior notes, at par, due 2021	$	—	$	300,000
Corporation subordinated notes, at par, due 2025	250,000		250,000
Capitalized costs	(839)		(1,663)
Finance leases	163		1,128
FHLB advances	1,621,047		1,632,723
Total long-term funding	1,870,371		2,182,188
Total short and long-term funding	$	2,224,633	$	2,434,505

Securities Sold Under Agreement to Repurchase

The Corporation enters into agreements under which it sells securities subject to an obligation to repurchase the same or similar securities. Under these arrangements, the Corporation may transfer legal control over the assets but still retain effective control through an agreement that both entitles and obligates the Corporation to repurchase the assets. The obligation to repurchase the securities is reflected as a liability on the Corporation’s consolidated balance sheets, while the securities underlying the repurchase agreements remain in the respective investment securities asset accounts (i.e., there is no offsetting or netting of the investment securities assets with the repurchase agreement liabilities).

The Corporation utilizes securities sold under agreements to repurchase to facilitate the needs of its customers. As of December 31, 2021, the Corporation pledged agency mortgage-related securities with a fair value of $448 million as collateral for the repurchase agreements. Securities pledged as collateral under repurchase agreements are maintained with the Corporation's safekeeping agents and are monitored on a daily basis due to the market risk of fair value changes in the

underlying securities. The Corporation generally pledges excess securities to ensure there is sufficient collateral to satisfy short-term fluctuations in both the repurchase agreement balances and the fair value of the underlying securities.

The remaining contractual maturity of the securities sold under agreements to repurchase on the consolidated balance sheets as of December 31, 2021 and 2020 are presented in the following table:

	Overnight and Continuous
($ in Thousands)	December 31, 2021		December 31, 2020
Repurchase agreements
Agency mortgage-related securities	$	319,412	$	185,901
Total	$	319,412	$	185,901

Long-Term Funding

Senior Notes 

In August 2018, the Bank issued $300 million of senior notes, due August 2021, and callable July 2021. The senior notes had a fixed coupon interest rate of 3.50% and were issued at a discount. The Bank redeemed all of the senior notes on July 13, 2021, the initial redemption date under the terms of the notes.

Subordinated Notes

In November 2014, the Corporation issued $250 million of 10-year subordinated notes, due January 2025, and callable October 2024. The subordinated notes have a fixed coupon interest rate of 4.25% and were issued at a discount.

Finance Leases

Finance leases are used in conjunction with branch operations. See Note 7 for additional disclosure regarding the Corporation’s leases.

FHLB Advances

Under agreements with the FHLB of Chicago, FHLB advances are secured by qualifying mortgages of the subsidiary bank (such as residential mortgage, residential mortgage loans held for sale, home equity, and CRE). At December 31, 2021, the Corporation had $8.4 billion of total collateral capacity, primarily supported by residential mortgage, CRE and home equity loans. At December 31, 2021, the FHLB advances had maturity or call dates ranging from 2022 through 2028, and had a weighted average interest rate of 2.05%, compared to 2.34% at December 31, 2020.

The table below summarizes the maturities of the Corporation’s long-term funding at December 31, 2021:

($ in Thousands)	Long Term Funding
Year
2022	$	11,811
2023	2,363
2024	633
2025	649,377
2026	604,813
Thereafter	601,375
Total long-term funding	$	1,870,371