Borrowed Funds

12 Months Ended

Dec. 31, 2024

Debt Disclosure [Abstract]

Borrowed Funds

Borrowed Funds

The Company's borrowed funds consisted of borrowings from the FHLB of $259.7 million at a weighted average rate of 4.17% at December 31, 2024. Borrowed funds at December 31, 2023 consisted of borrowings from the FHLB of $55.7 million at a weighted average rate of 3.68% and borrowings from the FRB of $10.0 million at a weighted average rate of 4.85%.

The Company has established both overnight and longer term lines of credit with the FHLB. These borrowings are secured by investment securities AFS, a blanket lien on qualified collateral consisting of loans with first mortgages secured by one-to-four family properties and certain commercial real estate loans. At December 31, 2024, pledged loans and investment securities AFS with a carrying value of $438.2 million provided a gross borrowing capacity of $322.5 million at the FHLB, less outstanding borrowings and other credit subject to collateralization of $309.3 million, resulting in remaining year-end available borrowing capacity of $13.2 million. At December 31, 2023, pledged loans with a carrying value of $343.7 million provided a gross borrowing capacity of $235.5 million at the FHLB, less outstanding borrowings and other credit subject to collateralization of $99.6 million, resulting in remaining year-end available borrowing capacity of $135.9 million.

Under a separate agreement with the FHLB, the Company has the authority, up to its available borrowing capacity, to collateralize public unit deposits with letters of credit issued by the FHLB. FHLB letters of credit in the amount of $47.3 million and $42.4 million were utilized as collateral for these deposits at December 31, 2024 and 2023, respectively. Total fees paid by the Company in connection with the issuance of these letters of credit were $44 thousand for the years ended December 31, 2024 and 2023. Union also maintains an IDEAL Way Line of Credit with the FHLB. The total line available was $551 thousand as of December 31, 2024 and 2023. There were no outstanding borrowings against this line of credit at December 31, 2024 and 2023.

In addition to its borrowing arrangements with the FHLB, Union maintains a preapproved Federal Funds line of credit with a correspondent bank totaling $15.0 million. Interest on advances under this line is payable daily and charged at the Federal Funds rate at the time of the borrowing. There were no outstanding borrowings on the line of credit at December 31, 2024 or 2023.

In March 2023, the FRB created the BTFP, a temporary program to provide an additional source of liquidity funding to U.S. depository institutions. Advances under this program were secured by qualifying investment assets consisting of eligible U.S. Government-sponsored enterprises and Agency MBS securities valued at par. The Company had no outstanding advances under this program at December 31, 2024. At December 31, 2023, the Company had an outstanding BTFP advance of $10.0 million at a rate of 4.85% due on December 23, 2024. The FRB ceased making new loans under this program on March 11, 2024.