Financials
Below you will find a quick summary of noteworthy financial highlights that may assist in understanding the detailed financial statements and supporting graphs.
Summary
LCBA’s financial outlook remains strong. Sights are set toward the future as LCBA’s management focuses on the implementation of the long-term strategic plan and ways to continue to support its members for many years to come.
Financial Highlights
LCBA’s surplus decreased by $100k in 2022, while recognizing a net income of $163k and improving its Risk-Based Capital ratio to 913% from 903% in 2021. The overall financial results reflect LCBA’s internal projections and support the plan for the future of the Association. In 2021 and 2022, significant investments were made in the launch of the new Family Protector II Simplified Issue Whole Life product in addition to formulating a long-term strategic plan to support LCBA’s continued efforts toward growth.
Overall portfolio investment quality remains high, with an average rating of “A” and 99% of bonds are investment grade. LCBA’s bond portfolio grew by $5.45 million from 2021. LCBA also invested in two direct mortgage loans totaling $500k in 2022. The ending book yield for 2022 remains consistent with 2021 as LCBA continues to improve diversification and uphold book yield as much as possible without assuming unnecessary risk.
General expenses, budgeted to be up 10% in 2022 due to LCBA’s growth strategy, ended 10% under budget. Much of this variance is due to the timing of incurred expenses, as there were unexpected delays in the launch of the new product. Overall, expenses are expected to increase in the coming year as LCBA continues to make strategic investments in the future.
2022 ANNUAL FINANCIAL REPORT
SUMMARY OF FINANCIAL POSITION
As of December 31,
| Assets | 2022 | 2021 |
|---|---|---|
| Bonds | $106,244,024 | $100,793,451 |
| Mortgage Loans | $500,000 | - |
| Real Estate | $1,468,675 | $1,501,760 |
| Certificate Loans | $946,842 | $998,779 |
| Cash & Cash Equivalents | $3,280,212 | $2,276,788 |
| EDP Equipment | $18,883 | $14,669 |
| Income Due & accrued | $2,311,585 | $2,701,909 |
| Total Assets | $114,770,221 | $108,287,356 |
| Liabilities & Surplus | 2022 | 2021 |
| Certificate Reserves | $89,272,521 | $81,965,339 |
| Deposit-Type Contracts | $5,910,361 | $5,887,320 |
| Certificate Claims | $488,547 | $674,770 |
| Provision for Dividends | $369,951 | $201,684 |
| Advance Premiums | $199,741 | $183,609 |
| Investment Reserves | $6,907,493 | $7,435,988 |
| Accrued General Expenses | $264,444 | $188,997 |
| Other Liabilities | $695,653 | $988,375 |
| Unassigned Funds | $10,661,510 | $10,761,274 |
| Total Liabilities & Surplus | $114,770,221 | $108,287,356 |
SUMMARY OF OPERATIONS
Through December 31,
| Income | 2022 | 2021 |
|---|---|---|
| Life insurance premiums | $10,010,410 | $11,493,201 |
| Annuity premiums | $5,566,999 | $4,720,071 |
| Accident & health premiums | $112,095 | $125,742 |
| Net investment income | $4,831,754 | $4,723,103 |
| Other income | $1,498,301 | $1,711,259 |
| Total Income | $22,019,559 | $22,773,376 |
| Member Benefits | 2022 | 2021 |
| Death benefits | $3,923,153 | $4,617,662 |
| Life & annuity benefits | $5,264,985 | $5,358,153 |
| Reserve changes | $7,307,186 | $7,263,522 |
| Total Member Benefits | $16,495,324 | $17,239,337 |
| Operating Expenses | 2022 | 2021 |
| Commissions | $1,409,006 | $4,617,662 |
| General expenses | $3,445,283 | $3,472,623 |
| Taxes & other | $154,752 | $123,822 |
| Total Operating Expenses | $5,009,041 | $5,159,156 |
| Total Operating Expenses | $21,504,365 | $22,398,493 |
| Net Gain from Operations | $515,194 | $374,883 |
| Dividends incurred | $(352,301) | $(312,403) |
| Net Income | $162,893 | $62,480 |
| Other Changes in Surplus | $(262,657) | $(168,193) |
| Net Change in Surplus | $(99,764) | $(105,713) |
