INVESTMENT BORROWINGS

6 Months Ended

Jun. 30, 2022

Investment Borrowings [Abstract]

INVESTMENT BORROWINGS

INVESTMENT BORROWINGS

Three of the Company's insurance subsidiaries (Bankers Life and Casualty Company ("Bankers Life"), Washington National Insurance Company ("Washington National") and Colonial Penn Life Insurance Company ("Colonial Penn")) are members of the FHLB.  As members of the FHLB, our insurance subsidiaries have the ability to borrow on a collateralized basis from the FHLB. We are required to hold certain minimum amounts of FHLB common stock as a condition of membership in the FHLB, and additional amounts based on the amount of the borrowings.  At June 30, 2022, the carrying value of the FHLB common stock was $75.2 million.  As of June 30, 2022, collateralized borrowings from the FHLB totaled $1.6 billion and the proceeds were used to purchase fixed maturity securities.  The borrowings are classified as investment borrowings in the accompanying consolidated balance sheet.  The borrowings are collateralized by investments with an estimated fair value of $2.0 billion at June 30, 2022, which are maintained in a custodial account for the benefit of the FHLB.  Substantially all of such investments are classified as fixed maturities, available for sale, in our consolidated balance sheet.  

The following summarizes the terms of the borrowings from the FHLB by our insurance subsidiaries (dollars in millions):

Amount		Maturity	Interest rate at
borrowed		date	June 30, 2022
$	21.2	March 2023	Fixed rate – 2.160%
50.0		July 2023	Variable rate – 1.710%
100.0		July 2023	Variable rate – 1.710%
50.0		July 2023	Variable rate – 1.710%
100.0		April 2024	Variable rate – 1.755%
50.0		May 2024	Variable rate – 2.154%
22.0		May 2024	Variable rate – 1.544%
75.0		June 2024	Variable rate – 2.544%
100.0		July 2024	Variable rate – 1.272%
15.5		July 2024	Fixed rate – 1.990%
34.5		July 2024	Variable rate – 1.730%
15.0		July 2024	Variable rate – 1.689%
27.0		August 2024	Fixed rate – .640%
25.0		September 2024	Variable rate – 2.275%
21.7		May 2025	Variable rate – 1.802%
18.8		June 2025	Fixed rate – 2.940%
125.0		September 2025	Variable rate – 1.860%
100.0		October 2025	Variable rate – 1.996%
100.0		October 2025	Variable rate – 2.005%
57.7		October 2025	Variable rate – 1.967%
50.0		November 2025	Variable rate – 1.481%
50.0		January 2026	Variable rate – 1.356%
50.0		January 2026	Variable rate – 1.401%
100.0		January 2026	Variable rate – 1.852%
21.8		May 2026	Variable rate – 1.742%
50.0		May 2026	Variable rate – 1.780%
50.0		April 2027	Variable rate – 1.189%
50.0		May 2027	Variable rate – 1.235%
100.0		June 2027	Variable rate – 1.880%
10.0		June 2027	Variable rate – 2.103%
$	1,640.2

The variable rate borrowings are pre-payable on each interest reset date without penalty.  The fixed rate borrowings are pre-payable subject to payment of a yield maintenance fee based on prevailing market interest rates.  At June 30, 2022, the aggregate yield maintenance fee to prepay all fixed rate borrowings was $1.9 million.

Interest expense of $7.1 million and $5.2 million in the first six months of 2022 and 2021, respectively, was recognized related to total borrowings from the FHLB.