The Company is currently reviewing the feasibility of a marketing opportunity with First Southern National Bank, an affiliate of UTG’s largest shareholder. The Company is looking at different types of products as a potential to sell to credit customers of First Southern National Bank. Other products are also being explored, including annuity type products and existing insurance products, as a possibility to market to all banking customers.
Financial Condition (a) Assets Investments are the largest asset group of the Company. The Company’s insurance subsidiaries are regulated by insurance statutes and regulations as to the type of investments that they are permitted to make and the amount of funds that may be used for any one type of investment. In light of these statutes and regulations, and the Company’s business and investment strategy, the Company generally seeks to invest in United States government and government agency securities and other high quality low risk investments.
Shareholders' equity: Common stock - no par value, stated value $.02 per share. Authorized 7,000,000 shares - 4,175,066 and 3,970,266 shares issued and outstanding after deducting treasury shares of 47,507 and 47,507 83,501 79,405 Additional paid-in capital 47,730,980 45,175,076 Accumulated deficit (1,435,335) (738,909) Accumulated other comprehensive income (deficit) 335,287 (1,138,900) ------------ ------------ Total shareholders' equity 46,714,433 43,376,672 ------------ ------------ Total liabilities and shareholders' equity $ 333,620,111 $ 339,160,528 ============ ============ See accompanying notes.
December 31, ------------------------------------------------ 2000 1999 1998 ------------- ------------- ------------- Fixed maturities and fixed maturities held for sale $ 11,775,706 $ 11,886,968 $ 11,981,660 Equity securities 116,327 91,429 92,196 Mortgage loans 1,777,374 1,079,332 859,543 Real estate 611,494 389,181 842,724 Policy loans 997,381 991,812 984,761 Other long-term investments 655,418 63,528 62,477 Short-term investments 158,378 147,726 29,907 Cash 936,433 850,836 1,235,888 ------------- ------------- ------------- Total consolidated investment income 17,028,511 15,500,812 16,089,156 Investment expenses (942,678) (971,275) (1,046,869) ------------- ------------- ------------- Consolidated net investment income $ 16,085,833 $ 14,529,537 $ 15,042,287 ============= ============= =============
The amortized cost and estimated market value of debt securities at December 31, 2000, by contractual maturity, is shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.
C. CONVERTIBLE DEBENTURES The convertible debentures were assumed from the July 1999, merger of UII into UTG. In early 1994, UII received $902,300 from the sale of Debentures. The Debentures were issued pursuant to an indenture between UII and National City Bank (formerly First of America Bank - Southeast Michigan, N.A.), as trustee. The Debentures were general unsecured obligations of UII, subordinate in right of payment to any existing or future senior debt of UII. The Debentures were bearing interest quarterly at a variable rate equal to one percentage point above the prime rate published in the Wall Street Journal from time to time. During second quarter of 2000, the Company retired all of the remaining outstanding debenture debt of $675,800.
The following table summarizes certain unaudited operating results of UTG as though the merger transaction had taken place on December 31, 1999 and 1998, respectively.