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SECURITIES | 12 Months Ended
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Sep. 30, 2021
Investments, Debt and Equity Securities [Abstract] |
SECURITIES | SECURITIES The amortized cost, gross unrealized gains and losses and estimated fair values of available for sale ("AFS") and held to maturity ("HTM") debt securities are presented below.
| Debt Securities AFS
(Dollars in Thousands) | Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized (Losses) |  | Fair Value
At September 30, 2021 |  |  |  |  |  |  |
Corporate securities | $ | 25,000 |  |  | $ | — |  |  | $ | — |  |  | $ | 25,000 |
SBA securities | 151,958 |  |  | 5,251 |  |  | — |  |  | 157,209 |
Obligations of states and political subdivisions | 2,497 |  |  | 10 |  |  | — |  |  | 2,507 |
Non-bank qualified obligations of states and political subdivisions | 266,048 |  |  | 3,347 |  |  | (1,100) |  |  | 268,295 |
Asset-backed securities | 393,103 |  |  | 3,003 |  |  | (1,247) |  |  | 394,859 |
Mortgage-backed securities | 1,016,478 |  |  | 9,728 |  |  | (9,177) |  |  | 1,017,029 |
Total debt securities AFS | $ | 1,855,084 |  |  | $ | 21,339 |  |  | $ | (11,524) |  |  | $ | 1,864,899 |
At September 30, 2020 |  |  |  |  |  |  |
SBA securities | $ | 159,722 |  |  | $ | 5,391 |  |  | $ | (158) |  |  | $ | 164,955 |
Obligations of states and political subdivisions | 825 |  |  | 16 |  |  | — |  |  | 841 |
Non-bank qualified obligations of states and political subdivisions | 314,819 |  |  | 8,978 |  |  | (23) |  |  | 323,774 |
Asset-backed securities | 329,139 |  |  | 2,015 |  |  | (6,229) |  |  | 324,925 |
Mortgage-backed securities | 439,879 |  |  | 14,567 |  |  | (839) |  |  | 453,607 |
Total debt securities AFS | $ | 1,244,384 |  |  | $ | 30,967 |  |  | $ | (7,249) |  |  | $ | 1,268,102 |
| Debt Securities HTM
(Dollars in Thousands) | Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized (Losses) |  | Fair Value
At September 30, 2021 |  |  |  |  |  |  |
Non-bank qualified obligations of states and political subdivisions | $ | 52,944 |  |  | $ | 103 |  |  | $ | (471) |  |  | $ | 52,576 |
Mortgage-backed securities | 3,725 |  |  | 90 |  |  | — |  |  | 3,815 |
Total debt securities HTM | $ | 56,669 |  |  | $ | 193 |  |  | $ | (471) |  |  | $ | 56,391 |
At September 30, 2020 |  |  |  |  |  |  |
Non-bank qualified obligations of states and political subdivisions | $ | 87,183 |  |  | $ | 1,040 |  |  | $ | (29) |  |  | $ | 88,194 |
Mortgage-backed securities | 5,427 |  |  | 124 |  |  | — |  |  | 5,551 |
Total debt securities HTM | $ | 92,610 |  |  | $ | 1,164 |  |  | $ | (29) |  |  | $ | 93,745 |
Gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities have been in continuous unrealized loss position, were as follows:
| LESS THAN 12 MONTHS |  | OVER 12 MONTHS |  | TOTAL
(Dollars in Thousands) | Fair Value |  | Gross Unrealized (Losses) |  | Fair Value |  | Gross Unrealized (Losses) |  | Fair Value |  | Gross Unrealized (Losses)
Debt Securities AFS |  |  |  |  |  |  |  |  |  |  |
At September 30, 2021 |  |  |  |  |  |  |  |  |  |  |
Non-bank qualified obligations of states and political subdivisions | $ | 101,046 |  |  | $ | (1,100) |  |  | $ | — |  |  | $ | — |  |  | $ | 101,046 |  |  | $ | (1,100) |
Asset-backed securities | 127,110 |  |  | (283) |  |  | 91,553 |  |  | (964) |  |  | 218,663 |  |  | (1,247) |
Mortgage-backed securities | 759,035 |  |  | (7,418) |  |  | 60,792 |  |  | (1,759) |  |  | 819,827 |  |  | (9,177) |
Total debt securities AFS | $ | 987,191 |  |  | $ | (8,801) |  |  | $ | 152,345 |  |  | $ | (2,723) |  |  | $ | 1,139,536 |  |  | $ | (11,524) |
At September 30, 2020 |  |  |  |  |  |  |  |  |  |  |
SBA securities | $ | 32,257 |  |  | $ | (102) |  |  | $ | 9,875 |  |  | $ | (56) |  |  | $ | 42,132 |  |  | $ | (158) |
Non-bank qualified obligations of states and political subdivisions | 6,265 |  |  | (6) |  |  | 3,103 |  |  | (17) |  |  | 9,368 |  |  | (23) |
Asset-backed securities | 106,474 |  |  | (1,089) |  |  | 178,686 |  |  | (5,140) |  |  | 285,160 |  |  | (6,229) |
Mortgage-backed securities | 138,338 |  |  | (839) |  |  | — |  |  | — |  |  | 138,338 |  |  | (839) |
Total debt securities AFS | $ | 283,334 |  |  | $ | (2,036) |  |  | $ | 191,664 |  |  | $ | (5,213) |  |  | $ | 474,998 |  |  | $ | (7,249) |
Debt Securities HTM |  |  |  |  |  |  |  |  |  |  |
At September 30, 2021 |  |  |  |  |  |  |  |  |  |  |
Non-bank qualified obligations of states and political subdivisions | $ | 26,096 |  |  | $ | (471) |  |  | $ | — |  |  | $ | — |  |  | $ | 26,096 |  |  | $ | (471) |
Total debt securities HTM | $ | 26,096 |  |  | $ | (471) |  |  | $ | — |  |  | $ | — |  |  | $ | 26,096 |  |  | $ | (471) |
At September 30, 2020 |  |  |  |  |  |  |  |  |  |  |
Non-bank qualified obligations of states and political subdivisions | $ | 7,397 |  |  | $ | (9) |  |  | $ | 3,637 |  |  | $ | (20) |  |  | $ | 11,034 |  |  | $ | (29) |
Total debt securities HTM | $ | 7,397 |  |  | $ | (9) |  |  | $ | 3,637 |  |  | $ | (20) |  |  | $ | 11,034 |  |  | $ | (29) |
The adoption of CECL was inconsequential to debt securities AFS. At September 30, 2021, there were 67 securities AFS in an unrealized loss position. Management assessed each investment security with unrealized losses for credit loss and determined substantially all unrealized losses on these securities were due to credit spreads and interest rates versus credit loss. As part of that assessment, management evaluated and concluded that it is more-likely-than-not that the Company will not be required and does not intend to sell any of the securities prior to recovery of the amortized cost. At September 30, 2021, there was no ACL for debt securities AFS. The amortized cost and fair value of debt securities by contractual maturity are shown below. Certain securities have call features which allow the issuer to call the security prior to maturity. Expected maturities may differ from contractual maturities in MBS because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Therefore, MBS are not included in the maturity categories in the following maturity summary. The expected maturities of certain SBA securities may differ from contractual maturities because the borrowers may have the right to prepay the obligation. However, certain prepayment penalties may apply.
| At September 30,
(Dollars in Thousands) | 2021 |  | 2020
Securities AFS at Fair Value | Amortized Cost |  | Fair Value |  | Amortized Cost |  | Fair Value
Due in one year or less | $ | 810 |  |  | $ | 822 |  |  | $ | 1,385 |  |  | $ | 1,398 |
Due after one year through five years | 13,026 |  |  | 13,378 |  |  | 20,805 |  |  | 21,769 |
Due after five years through ten years | 50,785 |  |  | 52,357 |  |  | 32,441 |  |  | 34,025 |
Due after ten years | 773,985 |  |  | 781,313 |  |  | 749,874 |  |  | 757,303 |
| 838,606 |  |  | 847,870 |  |  | 804,505 |  |  | 814,495 |
Mortgage-backed securities | 1,016,478 |  |  | 1,017,029 |  |  | 439,879 |  |  | 453,607 |
Total securities AFS, at fair value | $ | 1,855,084 |  |  | $ | 1,864,899 |  |  | $ | 1,244,384 |  |  | $ | 1,268,102 |
| At September 30,
(Dollars in Thousands) | 2021 |  | 2020
Securities HTM at Fair Value | Amortized Cost |  | Fair Value |  | Amortized Cost |  | Fair Value
Due after ten years | $ | 52,944 |  |  | $ | 52,576 |  |  | $ | 87,183 |  |  | $ | 88,194 |
| 52,944 |  |  | 52,576 |  |  | 87,183 |  |  | 88,194 |
Mortgage-backed securities | 3,725 |  |  | 3,815 |  |  | 5,427 |  |  | 5,551 |
Total securities HTM, at cost | $ | 56,669 |  |  | $ | 56,391 |  |  | $ | 92,610 |  |  | $ | 93,745 |
Activity related to the sale of securities available for sale is summarized below.
| Fiscal Year Ended September 30,
(Dollars in Thousands) | 2021 |  | 2020 |  | 2019
Available For Sale |  |  |  |  |
Proceeds from sales | $ | 50,468 |  |  | $ | 4,904 |  |  | $ | 755,616 |
Gross gains on sales | 179 |  |  | 51 |  |  | 6,006 |
Gross losses on sales | 173 |  |  | — |  |  | 5,277 |
Net gain (loss) on securities AFS | $ | 6 |  |  | $ | 51 |  |  | $ | 729 |
There was no activity related to the sale of securities held to maturity during the fiscal years ended September 30, 2021, 2020, and 2019. No securities were pledged as collateral for public funds on deposit at September 30, 2021 and 2020. No securities were pledged as collateral for individual, trust and estate deposits at September 30, 2021 and 2020. Equity Securities The Company held $12.7 million and $3.0 million in marketable equity securities at September 30, 2021 and 2020, respectively. The addition of marketable equity securities was a result of an investee becoming publicly traded in fiscal year ended September 30, 2021. Upon becoming publicly traded, the Company recognized a fair value adjustment of $7.5 million to reflect the increase in value since the Company's initial investment in May 2018. Subsequent fair value adjustments for this investee during fiscal year 2021 totaled $3.4 million in unrealized losses, or a net position of $4.1 million unrealized gain as of September 30, 2021. All other marketable equity securities and related activity were insignificant for the fiscal years ended September 30, 2021 and 2020, respectively. No marketable equity securities were sold during fiscal year 2021. Non-marketable equity securities with a readily determinable fair value totaled $4.6 million and $2.8 million as of September 30, 2021 and 2020, respectively. The Company’s recognized $0.6 million and zero in unrealized gains during the fiscal years ended September 30, 2021 and 2020, respectively. No such securities were sold during fiscal year 2021. Non-marketable equity securities without readily determinable fair value totaled $16.0 million and $23.0 million at September 30, 2021 and 2020, respectively. FRB Stock The Bank is required by federal law to subscribe to capital stock (divided into shares of $100 each) as a member of the FRB of Minneapolis with an amount equal to six per centum of the paid-up capital stock and surplus. One-half of the subscription is paid at time of application, and one-half is subject to call of the Board of Governors of the Federal Reserve System. FRB of Minneapolis stock held by the Bank totaled $19.7 million at September 30, 2021 and 2020. These equity securities are 'restricted' in that they can only be owned by member banks. At fiscal year-end 2021 and 2020, the Company pledged securities with fair values of approximately $236.1 million and $359.7 million against FRB advances, respectively. Included in interest and dividend income from other investments is $1.5 million and $0.3 million related to dividend income on FRB stock for the fiscal years ended September 30, 2021 and 2020, respectively. FHLB Stock The Company’s borrowings from the FHLB are secured by a blanket collateral agreement with respect to a percentage of unencumbered loans and the pledge of specific investment securities. Such advances can be made pursuant to several different credit programs, each of which has its own interest rate and range of maturities. The investments in the FHLB stock are required investments related to the Company’s membership in and current borrowings from the FHLB of Des Moines. The investments in the FHLB of Des Moines could be adversely impacted by the financial operations of the FHLB and actions of their regulator, the Federal Housing Finance Agency. The FHLB stock is carried at cost since it is generally redeemable at par value. The carrying value of the stock held at the FHLB was $8.7 million and $7.5 million at September 30, 2021 and 2020, respectively. At fiscal year-end 2021 and 2020, the Company pledged securities with fair values of approximately $644.7 million and $673.8 million, respectively, to be used against FHLB advances. In addition, a combination of qualifying residential and other real estate loans of zero and approximately $333.8 million were pledged as collateral at September 30, 2021 and 2020, respectively. Included in interest and dividend income from other investments is $0.2 million, $0.8 million and $1.0 million related to dividend income on FHLB stock for the fiscal years ended September 30, 2021, 2020 and 2019, respectively. These equity securities are ‘restricted’ in that they can only be sold back to the respective institution from which they were acquired or another member institution at par. Therefore, FRB and FHLB stocks are less liquid than other marketable equity securities, and the fair value approximates cost. Equity Security Impairment The Company evaluates impairment for investments held at cost on at least an annual basis based on the ultimate recoverability of the par value. All other equity investments, including those under the equity method, are reviewed for other-than-temporary impairment on at least a quarterly basis. The Company recognized $2.6 million and $1.3 million in impairment for such investments for the fiscal years ended September 30, 2021 and 2020, respectively, and zero for the fiscal year ended September 30, 2019.

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- Definition The entire disclosure for investments in certain debt and equity securities. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 320 -URI http://asc.fasb.org/subtopic&trid=2209399 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 946 -SubTopic 320 -URI http://asc.fasb.org/subtopic&trid=2324412 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -URI http://asc.fasb.org/topic&trid=2196928 Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 940 -SubTopic 320 -URI http://asc.fasb.org/subtopic&trid=2176304 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher SEC -Name Regulation S-K (SK) -Number 229 -Section 1403 -Paragraph (b) + Details
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