XML 68 R25.htm IDEA: XBRL DOCUMENT
v3.24.3

Income Taxes | 12 Months Ended
--- | ---
Sep. 30, 2024
Income Tax Disclosure [Abstract] |
Income Taxes | INCOME TAXES Under generally accepted accounting principles, the Company uses the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates applicable to taxable income in the years in which those temporary differences are expected to reverse. The table below provides a summary of the Company's tax assets and liabilities, including deferred tax assets and deferred tax liabilities by major source. Deferred tax balances represent temporary differences between the financial statement and corresponding tax treatment of income, gains, losses, deductions or credits. With the completion of the Merger, the deferred tax amounts now include a number of deferred tax items carried over from LBC, as well as new deferred tax items created as a consequence of the purchase accounting process and post-merger asset sales. In particular, deferred tax assets now include significant new items for loan purchase discount and loss carryover.
| September 30, 2024 | September 30, 2023
| (In thousands)
Deferred tax assets |  |
Allowance for credit losses | $ | 53,227 |  | $ | 46,191 |
REO reserves | 480 |  | 300 |
Non-accrual loan interest | 3,124 |  | 1,797 |
Accrued bonus and deferred compensation | 7,815 |  | 2,901 |
Stock based compensation | 4,696 |  | 3,089 |
Lease liability | 9,626 |  | 5,367 |
Loan purchase discount | 48,064 |  | — |
Loss carryover | 68,483 |  | — |
Other | 1,739 |  | 2,804 |
Total deferred tax assets | 197,254 |  | 62,449 |
Deferred tax liabilities |  |
FHLB stock dividends | 6,171 |  | 9,741 |
Net unrealized gain on available-for-sale securities and cash flow hedges | 13,758 |  | 13,933 |
Loan origination fees and costs | 11,777 |  | 11,471 |
Premises and equipment | 16,390 |  | 18,155 |
Lease right-of-use assets | 9,304 |  | 4,841 |
Equity investments | 3,700 |  | 4,244 |
Acquired intangibles | 12,824 |  | 4,798 |
Other | 184 |  | 483 |
Total deferred tax liabilities | 74,108 |  | 67,666 |
Net deferred tax asset (liability) | 123,146 |  | (5,217) |
Current tax asset (liability) | (3,898) |  | 13,696 |
Net tax asset (liability) | $ | 119,248 |  | $ | 8,479 |
At the end of the fiscal year, the Company has about $290 million of ordinary tax loss to be carried to future years. The loss carryover amount is based in large part from the tax loss realized from the portfolio loan sale following the Luther Burbank merger. Because of the annual loss limitation rules under Section 382 of the Internal Revenue Code, it will take about 17 years for the Company to utilize all that loss carryover against its future taxable income. However, there is no applicable time limit in this case, and therefore Company does not anticipate any expiration of the loss carryover amount. In its deferred tax assets at the end of the fiscal year, the Company also has about $1.2 million of remaining Oregon tax credits that the Company previously purchased as part of its community investments to support Oregon farmworkers housing. That remaining Oregon tax credit will be fully utilized under an installment schedule over the next two years. The table below presents a reconciliation of the statutory federal income tax rate to the Company's effective income tax rate.
Year ended September 30, | 2024 | 2023 | 2022
Statutory income tax rate | 21.0 | % | 21.0 | % | 21.0 | %
State income tax | 2.3 |  | 1.7 |  | 1.9 |
Tax-exempt interest income | (2.1) |  | (1.2) |  | (0.9) |
Interest expense disallowance | 1.2 |  | 0.5 |  | 0.1 |
Low-income housing investments | (1.1) |  | (1.3) |  | (0.9) |
Other differences | 0.6 |  | 0.1 |  | — |
Effective income tax rate | 21.9 | % | 20.8 | % | 21.2 | %
The following table summarizes the Company's income tax expense (benefit) for the respective periods.
Year ended September 30, | 2024 | 2023 | 2022
| (In thousands)
Federal: |  |  |
Current | $ | 54,817 |  | $ | 58,667 |  | $ | 50,854 |
Deferred | (4,767) |  | 3,334 |  | 7,187 |
| 50,050 |  | 62,001 |  | 58,041 |
State: |  |  |
Current | 7,837 |  | 4,425 |  | 6,600 |
Deferred | (1,872) |  | 1,224 |  | (934) |
| 5,965 |  | 5,649 |  | 5,666 |
Total |  |  |
Current | 62,654 |  | 63,092 |  | 57,454 |
Deferred | (6,639) |  | 4,558 |  | 6,253 |
| $ | 56,015 |  | $ | 67,650 |  | $ | 63,707 |
The Company does not have a liability for uncertain tax positions as of September 30, 2024 or September 30, 2023. The Company's federal income tax returns are open and subject to potential examination by the IRS for fiscal years 2021 and later. State income tax returns are generally subject to examination for a period of three to five years after filing. The state impact of any federal changes remains subject to examination by various states for a period of up to two years after formal notification to the states.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for income tax. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-12 Reference 2: http://www.xbrl.org/2003/role/exampleRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 231 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482663/740-10-55-231 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12C -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-12C Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12B -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-12B Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 270 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org/1943274/2147477891/740-270-50-1 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SAB Topic 6.I.5.Q1) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479360/740-10-S99-1 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Publisher FASB -URI https://asc.fasb.org/1943274/2147480990/946-20-50-13 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480678/235-10-S99-1 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/740/tableOfContent Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 14 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-14 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-21 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 17 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-17 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479360/740-10-S99-2 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482603/740-30-50-2 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration