v3.25.4
Funds Borrowed
12 Months Ended
Dec. 31, 2025
Debt Disclosure [Abstract]  
Funds Borrowed

(5) FUNDS BORROWED

The following table presents outstanding balances of funds borrowed.

 

Payments Due for the Year Ending December 31,

 

 

 

 

 

 

 

 

 

 

 

 

 

(Dollars in thousands)

 

2026

 

 

2027

 

 

2028

 

 

2029

 

 

2030

 

 

Thereafter

 

 

December 31, 2025 (1)

 

 

December 31, 2024 (1)

 

 

Interest
Rate
(2)

 

Deposits (3)

 

$

682,132

 

 

$

576,313

 

 

$

424,188

 

 

$

169,783

 

 

$

230,919

 

 

$

 

 

$

2,083,335

 

 

$

2,091,663

 

 

 

3.87

%

Privately placed notes

 

 

31,250

 

 

 

53,750

 

 

 

39,000

 

 

 

 

 

 

 

 

 

22,500

 

 

 

146,500

 

 

 

146,500

 

 

 

8.12

 

SBA debentures and borrowings

 

 

14,000

 

 

 

2,000

 

 

 

1,250

 

 

 

1,250

 

 

 

3,000

 

 

 

63,500

 

 

 

85,000

 

 

 

70,250

 

 

 

3.98

 

Trust preferred securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

33,000

 

 

 

33,000

 

 

 

33,000

 

 

 

6.12

 

Federal reserve and other borrowings

 

 

50,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

50,000

 

 

 

35,000

 

 

 

3.75

 

Strategic partner collateral deposits

 

 

6,081

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

6,081

 

 

 

3,000

 

 

 

3.87

 

Total

 

$

783,463

 

 

$

632,063

 

 

$

464,438

 

 

$

171,033

 

 

$

233,919

 

 

$

119,000

 

 

$

2,403,916

 

 

$

2,379,413

 

 

 

4.16

%

(1)
Excludes deferred financing costs of $8.4 million and $8.2 million as of December 31, 2025 and 2024.
(2)
Weighted average contractual rate as of December 31, 2025.
(3)
Balance includes $3.7 million and $6.0 million in retail savings deposit balances as of December 31, 2025 and 2024.

(A) DEPOSITS

Most deposits are raised through the use of investment brokerage firms that package time deposits in denominations of less than $250,000 qualifying for FDIC insurance into larger pools that are sold to the Bank. While brokered time deposits are sourced in amounts in excess of $250,000, all underlying deposits are in denominations of $250,000 or less. The rates paid on the deposits are highly competitive with market rates paid by other financial institutions. Additionally, a brokerage fee is paid, depending on the maturity of the deposits, the annual expense of which averages less than 0.15%. Interest on the deposits is accrued daily and paid monthly, quarterly, semiannually, or at maturity. Additionally, the Bank raises deposits through listing services, and, as of December 31, 2025 and 2024, the Bank had $17.2 million and $10.4 million in listing service deposit balances from other financial institutions. As of December 31, 2025 and 2024, the Bank had $3.7 million and $6.0 million in retail savings deposit balances. The following table presents the maturity of the deposit pools, which includes strategic partner reserve deposits, as of December 31, 2025.

(Dollars in thousands)

 

December 31, 2025

 

Three months or less

 

$

143,956

 

Over three months through six months

 

 

238,847

 

Over six months through one year

 

 

299,329

 

Over one year

 

 

1,401,203

 

Deposits

 

 

2,083,335

 

 Strategic partner collateral deposits

 

 

6,081

 

Total deposits

 

$

2,089,416

 

(B) FEDERAL RESERVE DISCOUNT WINDOW AND OTHER BORROWINGS

As of December 31, 2025, the Bank had $591.9 million in home improvement loans pledged as collateral for a discount window line of credit established at the Federal Reserve. The current advance rate on the pledged securities is approximately 49% of book value, for a total of approximately $292.9 million in secured borrowing capacity, of which $50.0 million was utilized as of December 31, 2025. The discount window facility is not committed, and any borrowings by the Bank from the discount window facility are at the discretion of the Federal Reserve. The weighted average interest rate on funds borrowed from the discount window was 3.75% as of December 31, 2025.

The Bank has borrowing arrangements with several commercial banks. These agreements are accommodations that can be terminated at any time, for any reason and allow the Bank to borrow up to $75.0 million. As of December 31, 2025, no outstanding amounts with respect to these arrangements.

(C) PRIVATELY PLACED NOTES

The Company has entered into various private placements with certain institutional investors over time. The following table presents the private placement notes outstanding for the years ended December 31, 2025 and 2024.

 

(Dollars in thousands)

 

 

 

 

 

 

 

 

December 31,

 

 

Date of Notes

 

Maturity

 

Interest Rate

 

 

Interest Payable

 

2025

 

 

2024

 

 

December 2020

 

December 2027

 

 

7.500

%

 

Semi-annually

 

$

53,750

 

 

$

53,750

 

 

February 2021 (1)

 

February 2026

 

 

7.250

%

 

Semi-annually

 

 

31,250

 

 

 

31,250

 

 

September 2023

 

September 2028

 

 

9.250

%

 

Semi-annually

 

 

39,000

 

 

 

39,000

 

 

June 2024

 

June 2039

 

 

8.875

%

 

Semi-annually

 

 

17,500

 

 

 

17,500

 

 

August 2024

 

August 2039

 

 

8.625

%

 

Semi-annually

 

 

5,000

 

 

 

5,000

 

 

 

 

 

 

 

 

 

 

 

$

146,500

 

 

$

146,500

 

(1)
Privately placed notes due in 2026 were repaid, in full, at maturity, on February 26, 2026.

(D) SBA DEBENTURES AND BORROWINGS

Over the years, the SBA has approved commitments for Medallion Capital, typically for a four and a half year term and a 1% fee. On February 28, 2024, Medallion Capital accepted a commitment from the SBA for $18.5 million in debenture financing, all of which had been utilized as of December 31, 2025. The Company does not currently have any commitments available from the SBA.

The following table presents the SBA debentures and borrowings for the years ended December 31, 2025 and 2024.

(Dollars in thousands)

 

 

 

 

 

 

 

 

December 31,

 

Date of Notes

 

Maturity

 

Interest Rate

 

 

Interest Payable

 

2025

 

 

2024

 

March 2015

 

March 2025

 

 

2.87

%

 

Semi-annually

 

$

 

 

$

10,000

 

September 2015

 

September 2025

 

 

3.57

%

 

Semi-annually

 

 

 

 

 

4,000

 

March 2016

 

March 2026

 

 

3.25

%

 

Semi-annually

 

 

1,500

 

 

 

1,500

 

March 2016

 

March 2026

 

 

3.18

%

 

Semi-annually

 

 

10,000

 

 

 

10,000

 

May 2016

 

September 2026

 

 

2.72

%

 

Semi-annually

 

 

2,500

 

 

 

2,500

 

March 2017

 

March 2027

 

 

3.52

%

 

Semi-annually

 

 

2,000

 

 

 

2,000

 

September 2018

 

September 2028

 

 

4.22

%

 

Semi-annually

 

 

1,250

 

 

 

1,250

 

March 2019

 

March 2029

 

 

3.79

%

 

Semi-annually

 

 

1,250

 

 

 

1,250

 

September 2020

 

September 2030

 

 

1.71

%

 

Semi-annually

 

 

3,000

 

 

 

3,000

 

June 2021

 

September 2031

 

 

1.58

%

 

Semi-annually

 

 

8,500

 

 

 

8,500

 

October 2021

 

March 2032

 

 

3.21

%

 

Semi-annually

 

 

7,000

 

 

 

7,000

 

October 2022

 

March 2033

 

 

5.44

%

 

Semi-annually

 

 

4,750

 

 

 

4,750

 

April 2023

 

September 2033

 

 

5.96

%

 

Semi-annually

 

 

4,750

 

 

 

4,750

 

September 2023

 

March 2034

 

 

5.08

%

 

Semi-annually

 

 

4,750

 

 

 

4,750

 

November 2023

 

March 2034

 

 

5.08

%

 

Semi-annually

 

 

5,000

 

 

 

5,000

 

March 2025

 

September 2035

 

 

4.58

%

 

Semi-annually

 

 

10,250

 

 

 

 

August 2025

 

September 2035

 

 

4.66

%

 

Semi-annually

 

 

18,500

 

 

 

 

 

 

 

 

 

 

 

 

 

$

85,000

 

 

$

70,250

 

(E) TRUST PREFERRED SECURITIES

In June 2007, the Company issued and sold $36.1 million aggregate principal amount of unsecured junior subordinated notes to Fin Trust which, in turn, sold $35.0 million of trust preferred securities to Merrill Lynch International and issued 1,083 shares of common stock to the Company. Interest is calculated using the Secured Overnight Financing Rate (SOFR) adjusted by a relevant spread adjustment of approximately 26 basis points, plus 2.13%. The notes mature in September 2037 and are prepayable at par. Interest is payable quarterly in arrears. The terms of the trust preferred securities and the notes are substantially identical. In December 2007, $2.0 million of the trust preferred securities were repurchased from a third-party investor. As of December 31, 2025, $33.0 million was outstanding on the trust preferred securities.

(F) COVENANT COMPLIANCE

Certain of the Company's debt agreements contain financial covenants that require the Company to maintain certain financial ratios and minimum tangible net worth. As of December 31, 2025, the Company was in compliance with all such covenants.