Note 12 - FHLB Advances and Other Borrowings

12 Months Ended

Dec. 31, 2016

Notes to Financial Statements

Debt Disclosure [Text Block]

NOTE

12

FHLB Advances and Other Borrowings

The Bank had no outstanding advances from the FHLB or borrowings from the Federal Reserve Bank of Minneapolis as of

December

31,

2016

or

December

31,

2015.

At

December

31,

2016

it had collateral pledged to the FHLB consisting of FHLB stock, mortgage loans, and investments with a borrowing capacity of approximately

$105.7

million. The Bank had the ability to draw additional borrowings of

$104.7

million from the FHLB, based upon the mortgage loans and securities that were pledged at

December

31,

2016,

subject to a requirement to purchase FHLB stock. The Bank also had the ability to draw additional borrowings of

$85.8

million from the Federal Reserve Bank of Minneapolis, based upon the loans that were pledged to them as of

December

31,

2016,

subject to approval from the Board of Governors of the Federal Reserve System (FRB).

At

December

31,

2015

the Bank had collateral pledged to the FHLB consisting of FHLB stock, mortgag

e loans, and investments with a borrowing capacity of approximately

$96.3

million. The Bank had the ability to draw additional borrowings of

$95.3

million from the FHLB, based upon the mortgage loans and securities that were pledged as of

December

31,

2015,

subject to a requirement to purchase FHLB stock. The Bank also had the ability to draw additional borrowings of

$73.5

million from the Federal Reserve Bank of Minneapolis, based upon the loans that were pledged to them as of

December

31,

2015,

subject to approval from the FRB.

On

December

15,

2014,

the Company entered into a Loan Agreement with an unrelated

third

party, providing for a term loan of up to

$10.0

million that was evidenced by a promissory note (the Note) with an interest rate of

6.50%

per annum. The principal balance of the Note is payable in consecutive equal annual installments of

$1.0

million on each anniversary of the date of the Loan Agreement, commencing on

December

15,

2015,

with the balance due on

December

15,

2021.

Provided that no default or event of default has occurred and is continuing, the Company

may,

at its option, elect to defer the payment of

one

installment of principal on the Note otherwise due prior to the maturity date, in which event such installment will become due and payable on the maturity date. The Company

may

voluntarily prepay the Note in whole or in part without penalty and the Company has prepaid

$1.0

million of principal on the Note in addition to the required annual payments. The outstanding loan balance was

$7.0

million at

December

31,

2016

and

$9.0

million at

December

31,

2015.