S&T BANCORP INCSTBA

S&T BANCORP INC Debt Disclosure

10-KFiled Feb 27, 20243 min read
LONG TERM BORROWINGS AND SUBORDINATED DEBT
Long-term borrowings are for original terms greater than one year and are comprised of FHLB advances, finance leases and junior subordinated debt securities. Our long-term borrowings were $39.3 million as of December 31, 2023 and $14.7 million as of December 31, 2022. Long-term FHLB advances are secured by the same loans as short-term FHLB advances. Total loans pledged as collateral at the FHLB were $4.6 billion at December 31, 2023. We were eligible to borrow up to an additional $2.7 billion based on qualifying collateral and up to a maximum borrowing capacity of $3.2 billion at December 31, 2023.
The following table represents the balance of long-term borrowings, the weighted average interest rate as of December 31 and interest expense for the years ended December 31:
(dollars in thousand)202320222021
Long-term borrowings$39,277 $14,741 $22,430 
Weighted average interest rate4.52 %2.61 %1.94 %
Interest expense$1,332 $411 $458 
Scheduled annual maturities and average interest rates for all of our long-term debt for each of the five years subsequent to December 31, 2023 and thereafter are as follows:
(dollars in thousands)BalanceAverage Rate
2024$38,381 4.49 %
202581 5.98 %
202686 6.00 %
202793 6.02 %
202894 6.05 %
Thereafter542 5.89 %
Total$39,277 4.52 %
Junior Subordinated Debt Securities
The following table represents the composition of junior subordinated debt securities at December 31 and the interest expense for the years ended December 31:
202320222021
(dollars in thousands)BalanceInterest
Expense		BalanceInterest
Expense		BalanceInterest
Expense
Junior subordinated debt$25,000 $1,738 $25,000 $850 $25,000 $756 
Junior subordinated debt—trust preferred securities24,358 2,372 29,453 1,545 29,393 1,087 
Total$49,358 $4,110 $54,453 $2,395 $54,393 $1,843 
The following table summarizes the key terms of our junior subordinated debt securities:
(dollars in thousands)
2006 Junior Subordinated Debt
Junior Subordinated Debt$25,000
Trust Preferred Securities—
Stated Maturity Date12/15/2036
Optional redemption date at parAny time after 9/15/2011
Regulatory CapitalTier 2
Interest Rate
3 month CME Term SOFR plus 186 bps
Interest Rate at December 31, 20237.25%
We have completed three private placements of trust preferred securities to financial institutions. In 2023, we redeemed $5.0 million of junior subordinated debt securities, along with $0.2 million in common equity issued by DNB Capital Trust I and held by us. As a result, DNB Capital Trust I has been paid off in its entirety, and we own 100 percent of the common equity of STBA Capital Trust I and DNB Capital Trust II, or the Trusts. The Trusts were formed to issue mandatorily redeemable capital securities to third-party investors. The proceeds from the sale of the securities and the issuance of the common equity by the Trusts were invested in junior subordinated debt securities issued by us. The third-party investors are considered the primary beneficiaries of the Trusts; therefore, the Trusts qualify as VIEs, but are not consolidated into our financial statements. The Trusts pay dividends on the securities at the same rate as the interest paid by us on the junior subordinated debt held by the Trusts. DNB Capital Trust II was acquired with the DNB merger.

Historical Timeline

Fiscal YearFiled
2023Feb 27, 2024Showing above
2022Feb 24, 2023
2021Feb 28, 2022
2020Mar 1, 2021
2019Mar 2, 2020
2018Feb 21, 2019
2017Mar 1, 2018
2015Feb 23, 2016

About Debt Disclosures

Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.

Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.

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