eTrade 2003 Annual Report Download - page 24

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Table of Contents
Index to Financial Statements
Note 13 to the consolidated financial statements provides additional information about these deposits, including the range of interest rates
paid on deposits and scheduled maturities of certificates of deposits, including certificates of deposits of $100,000 or more.
Borrowings
Deposits represent a significant component of our current funds. In addition, we borrow from the FHLB and sell securities under
repurchase agreements.
We are a member of, and own capital stock in, the FHLB system. In part, the FHLB provides us with a reserve credit capacity and
authorizes us to apply for advances on the security of FHLB stock and various home mortgages and other assets—
principally securities that are
obligations of, or guaranteed by, the United States government—provided we meet certain creditworthiness standards. At December 31, 2003,
our outstanding advances from the FHLB totaled $920.0 million at interest rates ranging from 1.15% to 6.96% and at a weighted-average rate
of 1.85%.
We also raise funds by selling securities to nationally recognized investment banking firms under agreements to repurchase the same
securities. The investment banking firms hold the securities in custody. We treat repurchase agreements as borrowings and secure them with
designated fixed- and variable-rate securities. We also participate in the Federal Reserve Bank’s special direct investment and treasury, tax and
loan borrowing programs. We use the proceeds from these transactions to meet our cash flow or asset/liability matching needs.
The following table sets forth information regarding the weighted-average interest rates and the highest and average month-end balances
of our borrowings (dollars in thousands):
16
Ending
Balance
Weighted
-
Average
Rate(1)
Maximum Amount
At Month-End
Yearly
Weighted-Average
Balance
Rate
At or for the year ended December 31, 2003:
Advances from the FHLB
$
920,000
1.85
%
$
1,058,300
$
935,043
4.55
%
Securities sold under agreement to repurchase and other
borrowings
$
5,365,498
1.30
%
$
6,696,506
$
5,976,730
2.68
%
At or for the year ended December 31, 2002:
Advances from the FHLB
$
1,310,300
1.89
%
$
1,414,300
$
970,226
5.87
%
Securities sold under agreement to repurchase and other
borrowings
$
5,918,622
1.04
%
$
6,628,670
$
3,835,442
3.91
%
At or for the year ended December 31, 2001:
Advances from the FHLB
$
906,300
2.72
%
$
1,737,000
$
1,223,724
6.41
%
Securities sold under agreement to repurchase and other
borrowings
$
3,272,100
1.89
%
$
4,167,387
$
3,180,272
5.99
%
(1) Excludes hedging costs.