Short-Term Borrowings and Long-Term Debt

12 Months Ended

Sep. 30, 2011

Debt Disclosure [Text Block]

NOTE 11. Short-Term Borrowings and Long-Term Debt

     During fiscal 2010, First Federal obtained unsecured federal funds lines totaling $35.0 million in aggregate with two unaffiliated banks. Borrowings from the federal funds lines and the Federal Reserve Bank of Richmond, which is secured by a portion of the manufactured housing loan portfolio, are included in other short-term borrowings on the Consolidated Balance Sheets if drawn, and are used to supplement other liquidity sources as needed. As of September 30, 2011, First Financial had borrowing availability of $249.7 million from these two sources, as compared with $269.3 million as of September 30, 2010. Subsequent to September 30, 2011 First Federal obtained an additional federal funds line of $5.0 million from an unaffiliated bank. There are currently no funds drawn from these lines.

     On March 19, 2004, First Financial issued $46.4 million of 30-year trust preferred securities through Capital Trust I, an unconsolidated special purpose trust, to unrelated institutional investors. The trust preferred securities qualify as Tier 1 capital under risk-based capital guidelines. Gross proceeds from the issuance were used by Capital Trust I to purchase junior subordinated deferred interest debt issued by First Financial. The subordinated debt is the only asset of Capital Trust I. The debt matures in thirty years and is an unsecured obligation of First Financial that ranks junior to First Financial’s other outstanding debt. Distributions on the trust preferred securities, which represent undivided beneficial interests in the assets of Capital Trust I, are payable quarterly in arrears at an annual rate of 7.00%, beginning July 7, 2004. The securities are callable and mature on April 6, 2034. Debt issuance costs, net of amortization, totaled $1.2 million and $1.3 million at September 30, 2011 and 2010, respectively, and are included in other assets on the Consolidated Balance Sheets.

     Other long-term debt consists of notes payable to several South Carolina non-profit organizations. These loans are part of a strategy to leverage low-income housing tax credits.

     The following table presents long term debt and their related weighted average interest rates.

	As of September 30,
(dollars in thousands)	2011					2010
	Balance		Rate			Balance		Rate
Junior subordinated debt to unconsolidated trust	$	46,392		7.00	%	$	46,392		7.00	%
Other long-term debt		812		4.59			812		4.59
	$	47,204		6.96	%	$	47,204		6.96	%

     The following table presents information related to the various forms of borrowings utilized during the years ended September 30, 2011 and 2010, respectively.

	At or for the Year Ended September 30,
(dollars in thousands)	2011			2010
Federal Funds lines of credit
At September 30,
Balance		---			---
Weighted average rate		---			---
During the year
Maximum amount outstanding at any month end		---		$	28,000
Daily average		---			8,721
Weighted average rate		---			0.88	%
Junior Subordinated debt to unconsolidated trust
At September 30,
Balance	$	46,392			46,392
Weighted average rate		7.00	%		7.00	%
During the year
Maximum amount outstanding at any month end		46,392			46,392
Daily average		46,392			46,392
Weighted average rate		7.00	%		7.00	%
Other long-term debt
At September 30,
Balance	$	812		$	812
Weighted average rate		4.59	%		4.59	%
During the year
Maximum amount outstanding at any month end	$	812		$	185,812
Daily average		812			71,004
Weighted average rate		4.59	%		0.30	%