Short Term Borrowings And Long-Term Debt

9 Months Ended

Sep. 30, 2013

Short Term Borrowings And Long-Term Debt [Abstract]

Short Term Borrowings and Long-Term Debt

Note 8—Short Term Borrowings and Long-term Debt

Short-term borrowings consist of securities sold under agreements to repurchase, federal funds purchased and other borrowings.  During the second quarter of 2013, the Corporation opened a $3 million line of credit with ACNB Bank to provide a source of liquidity.  The line, renewable annually, is secured by a first lien on the Codorus Valley Corporate Center.  The interest rate on the ACNB Bank line is Wall Street Journal Prime.  No draws have been made on the line and on September 30, 2013, the balance was zero.

A summary of long-term debt as of September 30, 2013 and December 31, 2012 is shown below.

	September 30,		December 31,
(dollars in thousands)	2013		2012
PeoplesBank’s obligations:
FHLBP
Due May 2013,  3.46%, amortizing	$	0	$	245
Due July 2015,  1.90%		5,000		5,000
Due July 2016,  2.35%		5,000		5,000
Due September 2016,  1.18%		10,000		0
Due March 2018,  1.17%		10,000		0
Due June 2018,  1.87%		5,000		5,000
Due June 2019,  2.10%		5,000		5,000
Total FHLBP		40,000		20,245
Capital lease obligation		203		260
Codorus Valley Bancorp, Inc. obligations:
Junior subordinated debt
Due 2034,  2.27%, floating rate based on 3 month
LIBOR plus 2.02%, callable quarterly		3,093		3,093
Due 2036,  1.81% floating rate based on 3 month
LIBOR plus 1.54%, callable quarterly		7,217		7,217
Total long-term debt	$	50,513	$	30,815

PeoplesBank’s long-term debt obligations to the Federal Home Loan Bank of Pittsburgh (FHLBP) are fixed rate instruments.  Under terms of a blanket collateral agreement with the FHLBP, the obligations are secured by FHLBP stock and qualifying loan receivables, principally real estate secured loans.

In June 2006, Codorus Valley formed CVB Statutory Trust No. 2, a wholly-owned special purpose subsidiary whose sole purpose was to facilitate a pooled trust preferred debt issuance of $7,217,000.  

In November 2004, Codorus Valley formed CVB Statutory Trust No. 1 to facilitate a pooled trust preferred debt issuance of $3,093,000.  The Corporation owns all of the common stock of these nonbank subsidiaries, and the debentures are the sole assets of the Trusts.  The accounts of both Trusts are not consolidated for financial reporting purposes in accordance with FASB ASC 810.  For regulatory capital purposes, all of the Corporation’s trust preferred securities qualified as Tier 1 capital for all reported periods.  Trust preferred securities are subject to capital limitations under the FDIC’s risk-based capital guidelines.  The Corporation used the net proceeds from these offerings to fund its operations.