Credit Arrangements

9 Months Ended

Sep. 30, 2022

Note 5 – Credit Arrangements

Instrument	Issue Date	Maturity Date	Revolving Credit Limit		December 31, 2021		Borrowings	Repayments	September 30, 2022
Lines of Credit:
UTG	11/20/2013	11/20/2022	$	8,000,000		0	0	0	$	0
UG - CMA	10/21/2021	10/6/2023		25,000,000		24,000,000	19,500,000	35,500,000		8,000,000
UG - REPO	10/21/2021	10/7/2022		25,000,000		0	0	0		0

The UTG line of credit carries interest at a fixed rate of 3.750% and is payable monthly. As collateral, UTG has pledged 100% of the common voting stock of its wholly owned subsidiary, Universal Guaranty Life Insurance Company.

During October of 2021, the Federal Home Loan Bank approved UG's Cash Management Advance ("CMA"). The CMA gives the Company the option of selecting a variable rate of interest for up to 90 days or a fixed rate for a maximum of 30 days. The variable rate CMA is prepayable at any time without a fee, while the fixed CMA is not prepayable prior to maturity. The Company has pledged bonds with a collateral lendable value of $19,595,054. During the fourth quarter of 2022, the Company repaid the outstanding balance of $8 million on the CMA. The interest rate on the borrowed funds is variable and was 3.13% at September 30, 2022.

The CMA is a source of overnight liquidity utilized to address the day-to-day cash needs of a Company. In order to provide the Company with multiple lending options, Management also applied for, and the FHLB approved, the Company's Repurchase ("REPO") Advance Application for $25 million. The REPO Advance requires a minimum borrowing of $15 million and provides financing for one day to one year at a fixed rate of interest. The Company has enough qualifying investments for collateral pledging of $25 million total against these two borrowing vehicles. The REPO expired on October 7, 2022 and Management did not renew this credit arrangement.