Investment Securities (Tables)

9 Months Ended

Jun. 30, 2018

Held to maturity and available for sale investment securities have been classified according to management’s intent and were as follows as of June 30, 2018 and September 30, 2017 (dollars in thousands):



	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
June 30, 2018
Held to maturity
Mortgage-backed securities ("MBS"):
U.S. government agencies	$	1,466	$	9	$	(19	)	$	1,456
Private label residential	489		575		(1		)	1,063
U.S. Treasury and U.S government agency securities	5,996		—		(75		)	5,921
Total	$	7,951	$	584	$	(95	)	$	8,440

Available for sale
MBS: U.S. government agencies	$	243	$	9	$	—		$	252
Mutual funds	1,000		—		(76		)	924
Total	$	1,243	$	9	$	(76	)	$	1,176

September 30, 2017
Held to maturity
MBS:
U.S. government agencies	$	532	$	11	$	(1	)	$	542
Private label residential	599		596		(2		)	1,193
U.S. Treasury and U.S. government agency securities	6,008		10		(9		)	6,009
Total	$	7,139	$	617	$	(12	)	$	7,744

Available for sale
MBS: U.S. government agencies	$	271	$	18	$	—		$	289
Mutual funds	1,000		—		(48		)	952
Total	$	1,271	$	18	$	(48	)	$	1,241

Unrealized Gain (Loss) on Investments

June 30, 2018 (dollars in thousands):



	Less Than 12 Months						12 Months or Longer						Total
	Estimated Fair Value		Gross Unrealized Losses			Quantity	Estimated Fair Value		Gross Unrealized Losses			Quantity	Estimated Fair Value		Gross Unrealized Losses
Held to maturity
MBS:
U.S. government agencies	$	1,010	$	(18	)	2	$	67	$	(1	)	5	$	1,077	$	(19	)
Private label residential	—		—			—	52		(1		)	8	52		(1		)
U.S. Treasury and U.S. government agency securities	5,921		(75		)	2	—		—			—	5,921		(75		)
Total	$	6,931	$	(93	)	4	$	119	$	(2	)	13	$	7,050	$	(95	)

Available for sale
MBS: U.S. government agency	$	35	$	—		1	$	—	$	—		—	$	35	$	—
Mutual funds	—		—			—	924		(76		)	1	924		(76		)
Total	$	35	$	—		1	$	924	$	(76	)	1	$	959	$	(76	)

Held to maturity and available for sale investment securities with unrealized losses were as follows for September 30, 2017 (dollars in thousands):



	Less Than 12 Months						12 Months or Longer						Total
	Estimated Fair Value		Gross Unrealized Losses			Quantity	Estimated Fair Value		Gross Unrealized Losses			Quantity	Estimated Fair Value		Gross Unrealized Losses
Held to maturity
MBS:
U.S. government agencies	$	—	$	—		—	$	114	$	(1	)	6	$	114	$	(1	)
Private label residential	—		—			—	85		(2		)	10	85		(2		)
U.S. Treasury and U.S. government agency securities	2,984		(9		)	1	—		—			—	2,984		(9		)
Total	$	2,984	$	(9	)	1	$	199	$	(3	)	16	$	3,183	$	(12	)

Available for sale
Mutual funds	$	—	$	—		—	$	952	$	(48	)	1	$	952	$	(48	)
Total	$	—	$	—		—	$	952	$	(48	)	1	$	952	$	(48	)

Schedule of Significant Inputs Utilized to Measure Estimate of Credit Loss Component on OTTI Securities

The following table presents a summary of the significant inputs utilized to measure management’s estimates of the credit loss component on OTTI securities as of June 30, 2018 and 2017:



	Range				Weighted
	Minimum		Maximum		Average
June 30, 2018
Constant prepayment rate	6.00	%	15.00	%	11.58	%
Collateral default rate	—	%	12.31	%	5.51	%
Loss severity rate	—	%	74.00	%	42.49	%

June 30, 2017
Constant prepayment rate	6.00	%	15.00	%	11.54	%
Collateral default rate	0.09	%	9.88	%	4.66	%
Loss severity rate	6.00	%	62.00	%	41.93	%

Other than Temporary Impairment, Credit Losses Recognized in Earnings

The following table presents the OTTI recoveries (losses) for the three and nine months ended June 30, 2018 and 2017 (dollars in thousands):




	Three Months Ended June 30, 2018				Three Months Ended June 30, 2017
	Held To Maturity		Available For Sale		Held To Maturity		Available For Sale
Total recoveries	$	19	$	—	$	—	$	—
Adjustment for portion of OTTI transferred from other comprehensive income (loss) before income taxes (1)	—		—		—		—
Net recoveries recognized in earnings (2)	$	19	$	—	$	—	$	—



	Nine Months Ended June 30, 2018					Nine Months Ended June 30, 2017
	Held To Maturity			Available For Sale		Held To Maturity		Available For Sale
Total recoveries	$	60		$	—	$	—	$	—
Adjustment for portion of OTTI transferred from other comprehensive income (loss) before income taxes (1)	(5		)	—		—		—
Net recoveries recognized in earnings (2)	$	55		$	—	$	—	$	—

_________________

(1) Represents OTTI related to all other factors.

(2) Represents OTTI related to credit losses.

The following table presents a roll forward of the credit loss component of held to maturity and available for sale debt securities that have been written down for OTTI with the credit loss component recognized in earnings for the nine months ended June 30, 2018 and 2017 (dollars in thousands):



	Nine Months Ended June 30,
	2018			2017
Beginning balance of credit loss	$	1,301		$	1,505
Additions:
Additional increases to the amount related to credit loss for which OTTI was previously recognized	14			—
Subtractions:
Realized losses previously recorded as credit losses	(69		)	(48		)
Recovery of prior credit loss	(55		)	—
Ending balance of credit loss	$	1,191		$	1,457

Schedule of Contractual Maturities of Debt Securities

The contractual maturities of debt securities at June 30, 2018 were as follows (dollars in thousands). Expected maturities may differ from scheduled maturities due to the prepayment of principal or call provisions.



	Held to Maturity				Available for Sale
	Amortized Cost		Estimated Fair Value		Amortized Cost		Estimated Fair Value
Due within one year	$	3,001	$	2,983	$	—	$	—
Due after one year to five years	4,018		3,943		—		—
Due after five years to ten years	42		42		—		—
Due after ten years	890		1,472		243		252
Total	$	7,951	$	8,440	$	243	$	252