Borrowings

12 Months Ended

Jun. 30, 2022

Borrowings

Borrowings

Note 8 -     Borrowings

There were no borrowings from the Federal Home Loan Bank of Chicago (FHLB) as of June 30, 2022 and 2021, respectively.

The Company maintains a collateral pledge agreement with the FHLB covering secured advances whereby the Company has agreed to retain, free of all other pledges, liens, and encumbrances, commercial, commercial real estate, and residential loans. The advances reprice daily at market rates. The pledged loans are discounted at a factor of 20% to 36% when aggregating the amount of loans required by the pledge agreement. The amount of eligible collateral was $37,536,518 and $35,421,507 as of June 30, 2022 and 2021, respectively. There was FHLB stock of $323,000 and $262,200 pledged as of June 30, 2022 and June 30, 2021, respectively.  The Company also has a federal funds purchased borrowing arrangement with a correspondent bank for $5.0 million which reprices daily based on the Federal Funds rate.  There were no borrowings under this arrangement at June 30, 2022.

Information concerning FHLB advances is set forth below.

	June 30,
	2022			2021
Balance at end of year	$	-		$	-
Maximum outstanding at any month end	$	-		$	8,000,000
Weighted average interest rate at end of year		-	%		-	%
Average interest rate during year		-	%		0.29	%

The Company participated in the Paycheck Protection Program Lending Facility (the PPPLF), which was authorized by the Board of Governors of the Federal Reserve System on April 8, 2020 as a response to the global coronavirus pandemic. The PPPLF allowed for the Company to receive funding for Paycheck Protection Program (PPP) loans, wherein the PPP loans are pledged to the advances of the funds. The PPP loans were originated by the Company under a U.S. Small Business Administration (SBA) program and are included in commercial and industrial loans on the balance sheet as of June 30, 2021. There were no PPP loans outstanding as of June 30, 2022.

The interest rate applicable to any advance made under the PPPLF is 35 basis points, and the maturity date will be the maturity date of the PPP loans pledged to the advances. The balance of PPP loans, and accordingly the balance of the PPPLF advances, was $0 and $10,372,148 as of June 30, 2022 and June 30, 2021, respectively.