(8) Other Borrowings  In 2003, the Company issued $8.2 million of subordinated debentures. These debentures, which are due in 2034  and are currently redeemable, were issued to a wholly owned grantor trust (the “Trust”) formed to issue preferred securities  representing undivided beneficial interests in the assets of the Trust. The Trust then invested the gross proceeds of such  preferred securities in the debentures. The Trust’s preferred securities and the subordinated debentures require quarterly  interest payments and have variable rates, adjustable quarterly. Interest accrues at LIBOR plus 2.85%. The interest rates at  December 31, 2012 and 2011 were 3.16% and 3.28%, respectively.  In 2005, the Company issued an additional $8.2 million of subordinated debentures. These debentures, which are  due in 2036 and are currently redeemable, were issued to a wholly owned grantor trust (“Trust II”) formed to issue preferred  securities representing undivided beneficial interests in the assets of Trust II. Trust II then invested the gross proceeds of  such preferred securities in the debentures. Trust II’s preferred securities and the subordinated debentures require quarterly  interest payments and have variable rates, adjustable quarterly. Interest accrues at LIBOR plus 1.34%. The interest rates at  December 31, 2012 and 2011 were 1.65% and 1.89%, respectively.  While these Trusts are accounted for as unconsolidated equity investments, a portion of the trust preferred  securities issued by the Trust qualifies as Tier 1 Capital for regulatory purposes. The Company has a $7.5 million line of credit from an unrelated financial institution maturing on November 5,  2013, with an interest rate that adjusts daily based on the prime rate plus 0.25%, but not less than 4.00%. This line of credit  has covenants specific to capital and other ratios, which the Company was in compliance with at December 31, 2012. The  Company did not have an outstanding balance on the line of credit at December 31, 2012, compared to $1.6 million  outstanding at December 31, 2011, which was included in other borrowings. Repurchase agreements are comprised of non-insured customer funds, totaling $5.0 million at December 31, 2012  and $9.3 million at December 31, 2011 which are secured by $8.1 million and $13.4 million of the Bank’s investment  portfolio at the same periods, respectively. Customer repurchase agreements are offered to deposit customers wishing to  earn interest on highly liquid balances and are used by the Company as a funding source which is considered to be stable  and short-term in nature. Most of the repurchase agreements have variable rates indexed to the 90-day U.S. treasury rate. Outstanding repurchase agreement balances averaged $4.7 million during 2012 and $5.8 million in 2011. The average rate  on the repurchase agreements during 2012 was 0.45% compared to 0.63% during 2011. At December 31, 2012 and 2011, the Bank had no borrowings through the Federal Reserve discount window,  while the borrowing capacity was $15.8 million and $17.0 million, respectively. The Bank also has various other federal  funds agreements, both secured and unsecured, with correspondent banks totaling approximately $109.2 million. As of  December 31, 2012 and 2011 there were no borrowings through these correspondent bank federal funds agreements.  85 