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INCOME TAXES (Tables)

12 Months Ended

Sep. 30, 2023

Income Tax Disclosure [Abstract]

Provision for Income Taxes

The Company and its subsidiaries file a consolidated federal income tax return on a fiscal year basis. The provision for income taxes were as follows:

			Fiscal Year Ended September 30,
(Dollars in thousands)			2023						2022						2021
Federal:
Current			$	8,682					$	5,657					$	6,402
Deferred			(1,168)						12,900						(3,909)
			7,514						18,557						2,493
State:
Current			7,817						4,720						5,938
Deferred			993						4,687						2,270
			8,810						9,407						8,208
Income tax expense			$	16,324					$	27,964					$	10,701

Components of Net Deferred Tax Asset (Liability)

The tax effects of the Company's temporary differences that give rise to significant portions of its deferred tax assets and liabilities were:

			At September 30,
(Dollars in thousands)			2023						2022
Deferred tax assets:
Bad debts			$	11,606					$	10,636
Deferred compensation			3,739						2,652
Stock based compensation			3,916						3,521
Valuation adjustments			393						3,047
General business credits(1)			59,783						52,684
Accrued expenses			2,558						1,948
Lease liability			7,210						8,074
Net unrealized loss on securities available for sale			84,908						71,336
Other assets			4,193						2,662
			178,306						156,560
Deferred tax liabilities:
Premises and equipment			(2,016)						(3,148)
Intangibles			(5,862)						(4,099)
Leased assets			(66,877)						(58,592)
Right-of-use assets			(6,877)						(7,758)
Other liabilities			(1,349)						(1,170)
			(82,981)						(74,767)
Net deferred tax assets			$	95,325					$	81,793

(1) The general business credits are investment tax credits generated from qualified solar energy property placed in service during the fiscal years ended September 30, 2023 and 2022. These credits will begin to expire on September 30, 2041.

Reconciliation of Total Income Tax Expense

The Company's effective tax rate is calculated by dividing income tax expense by income before income tax expense.

			Fiscal Year Ended September 30,
			2023									2022									2021
(Dollars in thousands)			Amount			Rate						Amount			Rate						Amount			Rate
Statutory federal income tax expense and rate			$	38,248		21.0		%				$	38,714		21.0		%				$	32,854		21.0		%
Change in tax rate resulting from:
State income taxes net of federal benefits			7,047			3.9		%				7,413			4.0		%				6,452			4.1		%
162(m) disallowance			919			0.5		%				1,125			0.4		%				686			0.4		%
Tax exempt income			(783)			(0.4)		%				(743)			(0.4)		%				(835)			(0.5)		%
General business credits			(28,633)			(15.7)		%				(17,589)			(9.5)		%				(26,945)			(17.2)		%
Other, net			(474)			(0.3)		%				(956)			(0.3)		%				(1,511)			(1.0)		%
Income tax expense			$	16,324		9.0		%				$	27,964		15.2		%				$	10,701		6.8		%

Reconciliation of Liabilities Associated with Unrecognized Tax Benefits

A reconciliation of the beginning and ending balances for liabilities associated with unrecognized tax benefits follows:

			At September 30,
(Dollars in thousands)			2023						2022
Balance at beginning of fiscal year			$	645					$	777
Additions (reductions) for tax positions related to prior years			(124)						(132)
Balance at end of fiscal year			$	521					$	645

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Tabular disclosure of the components of income tax expense attributable to continuing operations for each year presented including, but not limited to: current tax expense (benefit), deferred tax expense (benefit), investment tax credits, government grants, the benefits of operating loss carryforwards, tax expense that results from allocating certain tax benefits either directly to contributed capital or to reduce goodwill or other noncurrent intangible assets of an acquired entity, adjustments of a deferred tax liability or asset for enacted changes in tax laws or rates or a change in the tax status of the entity, and adjustments of the beginning-of-the-year balances of a valuation allowance because of a change in circumstances that causes a change in judgment about the realizability of the related deferred tax asset in future years.

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Tabular disclosure of the reconciliation using percentage or dollar amounts of the reported amount of income tax expense attributable to continuing operations for the year to the amount of income tax expense that would result from applying domestic federal statutory tax rates to pretax income from continuing operations.

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