NOTE 10 - SHORT-TERM BORROWINGS

The Bank has short-term advances from the Federal Home Loan Bank that had maturity dates of less than one year at the time of the advance. All balances are due within one year and can be renewed at the time of maturity.  Federal Home Loan Bank advances are secured by pledgings described in the following Long-Term Borrowings footnote.  Balances at year end were as follows:

 

Securities sold under repurchase agreements are secured by the Bank’s holdings of debt securities issued by U.S. government sponsored entities and agencies with a carrying amount of $79.3 million and $61.7 million at year ended 2015 and 2014.

Repurchase agreements are financing arrangements that mature within 89 days and usually overnight. Under the agreements, customers agree to maintain funds on deposit with the Bank and in return acquire an interest in a pool of securities pledged as collateral against the funds. The securities are held in segregated safekeeping accounts at the Federal Reserve Bank and Farmers Trust Company. Information concerning securities sold under agreements to repurchase is summarized as follows:

 

The following table provides a disaggregation of the obligation by class of collateral pledged for short-term financing obtained through the sales of repurchase agreements:

 

Management believes the risks associated with the agreements are minimal and in the case of collateral decline the company has additional investment securities available to adequately pledge as guarantees for the repurchase agreements.

The Bank has access to lines of credit amounting to $25 million at two major domestic banks that are below prime rate. The lines and terms are periodically reviewed by the banks and are generally subject to withdrawal at their discretion.  There were no borrowings under these lines at December 31, 2015 and 2014.

Farmers National Banc Corp has two unsecured revolving lines of credit for $6.5 million. The lines can be renewed annually. The lines have interest rates of prime with floors of 3.5% and 4.5%. The outstanding balance on the two lines was $350 thousand at December 31, 2015 and 2014.  The interest rate on the outstanding balance at December 31, 2015 and 2014 was 4.5%.