Regions Bank 2008 Annual Report Download - page 132

NOTE 13. SHORT-TERM BORROWINGS
Following is a summary of short-term borrowings at December 31:
2008 2007
(In thousands)
Federal funds purchased ............................. $ 34,502 $ 5,182,649
Securities sold under agreements to repurchase ........... 3,107,991 3,637,586
Term Auction Facility ............................... 10,000,000 —
Treasury, tax and loan notes .......................... 125 1,150,000
Federal Home Loan Bank structured advances ............ 1,500,000 100,000
Short-sale liability .................................. 628,666 451,344
Brokerage customer liabilities ......................... 430,626 505,487
Other short-term borrowings .......................... 120,052 93,056
$15,821,962 $11,120,122
Federal funds purchased and securities sold under agreements to repurchase are used to satisfy daily funding
needs. Federal funds purchased and securities sold under agreements to repurchase had weighted-average
maturities of 2 days and 20 days at December 31, 2008 and 2007, respectively. Weighted-average rates on these
dates were 0.5% and 3.3%, respectively.
During 2008, the Company utilized short-term borrowings through participation in the Federal Reserve’s
Term Auction Facility (“TAF”). These fundings were utilized primarily to repay other short-term borrowings or
provide excess balances at the Federal Reserve. The majority of the excess balances Regions carried in the
Federal Reserve cash account at year-end were generated through the TAF facility. The TAF was designed to
address pressures in short-term funding markets. Under the TAF, the Federal Reserve auctions term funds to
depository institutions with maturities of 28 or 84 days. All depository institutions that are eligible to borrow
under the primary credit program are eligible to participate in TAF auctions. All advances are fully collateralized
using collateral values and margins applicable for other Federal Reserve lending programs. Borrowings under the
TAF had a weighted-average maturity of 13 days and a weighted-average interest rate of 1.14% at December 31,
2008.
Treasury, tax and loan notes consist of borrowings from the Federal Reserve Bank. See Note 14 to the
consolidated financial statements for further discussion of Regions’ borrowing capacity with the FHLB.
The short-sale liability represents Regions’ trading obligation to deliver certain securities at a predetermined
date and price. Through Morgan Keegan, Regions maintains a liability for its brokerage customer position, which
represents liquid funds in the customers’ brokerage accounts.
Morgan Keegan maintains certain lines of credit with unaffiliated banks that provide for maximum
borrowings of $585 million and $485 million as of December 31, 2008 and 2007, respectively. Amounts
outstanding under these lines of credit as of December 31, 2008 and 2007, are included in other short-term
borrowings.
At December 31, 2008, Regions can borrow a maximum amount of approximately $9.0 billion from the
Federal Reserve Bank. Regions has pledged certain commercial, home equity and other consumer loans as
discount window collateral. See Note 6 for loans pledged to the Federal Reserve Bank at December 31, 2008 and
2007.
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