
	June 30, 2020						September 30, 2019
	Amount		Percent		Amount		Percent
Mortgage loans:
One- to four-family (1)	$	120,514	10.7	%	$	132,661	13.4	%
Multi-family	79,468		7.0		76,036		7.7
Commercial	455,454		40.5		419,117		42.3
Construction - custom and owner/builder	134,709		11.9		128,848		13.0
Construction - speculative one- to four-family	12,136		1.2		16,445		1.7
Construction - commercial	33,166		2.9		39,566		4.0
Construction - multi-family	27,449		2.4		36,263		3.6
Construction - land development	6,132		0.5		2,404		0.2
Land	27,009		2.4		30,770		3.1
Total mortgage loans	896,037		79.5		882,110		89.0

Consumer loans:
Home equity and second mortgage	34,405		3.0		40,190		4.1
Other	3,552		0.3		4,312		0.4
Total consumer loans	37,957		3.3		44,502		4.5

Commercial loans
Commercial business	71,586		6.3		64,764		6.5
U.S. Small Business Administration ("SBA") Paycheck Protection Program ("PPP") loans	122,581		10.9		—		—
Total commercial business and SBA PPP loans	194,167		17.2	%	64,764		6.5	%

Total loans receivable	1,128,161		100.0	%	991,376		100.0	%
Less:
Undisbursed portion of construction loans in process	95,785				92,226
Deferred loan origination fees, net	6,723				2,798
Allowance for loan losses	12,894				9,690
	115,402				104,714
Loans receivable, net	$	1,012,759			$	886,662
_____________________________
(1) Does not include one- to four-family loans held for sale totaling $9,837 and $6,071 at June 30, 2020 and September 30, 2019, respectively.


	Three Months Ended June 30, 2020
	Beginning Allowance		Provision for (Recapture of) Loan Losses		Charge- offs		Recoveries		Ending Allowance
Mortgage loans:
One- to four-family	$	1,149	$	14	$	—	$	—	$	1,163
Multi-family	595		70		—		—		665
Commercial	5,762		957		—		—		6,719
Construction – custom and owner/builder	697		110		—		—		807
Construction – speculative one- to four-family	204		(40)		—		—		164
Construction – commercial	423		(119)		—		—		304
Construction – multi-family	394		(76)		—		—		318
Construction – land development	80		27		—		—		107
Land	678		(41)		—		5		642
Consumer loans:
Home equity and second mortgage	656		(24)		—		—		632
Other	78		(4)		(1)		—		73
Commercial business loans	1,174		126		—		—		1,300
SBA PPP loans	—		—		—		—		—
Total	$	11,890	$	1,000	$	(1)	$	5	$	12,894


	Nine Months Ended June 30, 2020
	Beginning Allowance		Provision for (Recapture of) Loan Losses		Charge- offs		Recoveries		Ending Allowance
Mortgage loans:
One-to four-family	$	1,167	$	(7)	$	—	$	3	$	1,163
Multi-family	481		184		—		—		665
Commercial	4,154		2,560		—		5		6,719
Construction – custom and owner/builder	755		47		—		5		807
Construction – speculative one- to four-family	212		(48)		—		—		164
Construction – commercial	338		(34)		—		—		304
Construction – multi-family	375		(57)		—		—		318
Construction – land development	67		40		—		—		107
Land	697		(70)		—		15		642
Consumer loans:
Home equity and second mortgage	623		9		—		—		632
Other	99		(17)		(12)		3		73
Commercial business loans	722		593		(15)		—		1,300
SBA PPP loans	—		—		—		—		—
Total	$	9,690	$	3,200	$	(27)	$	31	$	12,894


	Three Months Ended June 30, 2019
	Beginning Allowance		Provision for (Recapture of) Loan Losses		Charge- offs		Recoveries		Ending Allowance
Mortgage loans:
One- to four-family	$	1,154	$	(36)	$	—	$	—	$	1,118
Multi-family	470		(32)		—		—		438
Commercial	4,122		(70)		—		—		4,052
Construction – custom and owner/builder	666		36		—		—		702
Construction – speculative one- to four-family	249		(28)		—		—		221
Construction – commercial	384		—		—		—		384
Construction – multi-family	272		95		—		—		367
Construction – land development	244		(118)		—		—		126
Land	649		48		(46)		5		656
Consumer loans:
Home equity and second mortgage	667		(21)		(1)		—		645
Other	112		(25)		(1)		1		87
Commercial business loans	752		151		(93)		25		835
Total	$	9,741	$	—	$	(141)	$	31	$	9,631


	Nine Months Ended June 30, 2019
	Beginning Allowance		Provision for (Recapture of) Loan Losses		Charge- offs		Recoveries		Ending Allowance
Mortgage loans:
One-to four-family	$	1,086	$	(35)	$	—	$	67	$	1,118
Multi-family	433		5		—		—		438
Commercial	4,248		(346)		—		150		4,052
Construction – custom and owner/builder	671		31		—		—		702
Construction – speculative one- to four-family	178		43		—		—		221
Construction – commercial	563		(179)		—		—		384
Construction – multi-family	135		232		—		—		367
Construction – land development	49		77		—		—		126
Land	844		(155)		(46)		13		656
Consumer loans:
Home equity and second mortgage	649		1		(5)		—		645
Other	117		(29)		(4)		3		87
Commercial business loans	557		355		(102)		25		835
Total	$	9,530	$	—	$	(157)	$	258	$	9,631


	Allowance for Loan Losses										Recorded Investment in Loans
	Individually Evaluated for Impairment		Collectively Evaluated for Impairment		Total		Individually Evaluated for Impairment		Collectively Evaluated for Impairment		Total
June 30, 2020
Mortgage loans:
One- to four-family	$	—	$	1,163	$	1,163	$	1,410	$	119,104	$	120,514
Multi-family	—		665		665		—		79,468		79,468
Commercial	—		6,719		6,719		3,267		452,187		455,454
Construction – custom and owner/builder	—		807		807		—		73,011		73,011
Construction – speculative one- to four-family	—		164		164		—		7,412		7,412
Construction – commercial	—		304		304		—		19,793		19,793
Construction – multi-family	—		318		318		—		14,430		14,430
Construction – land development	—		107		107		—		3,161		3,161
Land	25		617		642		186		26,823		27,009
Consumer loans:
Home equity and second mortgage	—		632		632		586		33,819		34,405
Other	—		73		73		10		3,542		3,552
Commercial business loans	38		1,262		1,300		432		71,154		71,586
SBA PPP loans	—		—		—		—		122,581		122,581
Total	$	63	$	12,831	$	12,894	$	5,891	$	1,026,485	$	1,032,376


September 30, 2019
Mortgage loans:
One- to four-family	$	—	$	1,167	$	1,167	$	1,192	$	131,469	$	132,661
Multi-family	—		481		481		—		76,036		76,036
Commercial	—		4,154		4,154		3,190		415,927		419,117
Construction – custom and owner/builder	—		755		755		—		75,411		75,411
Construction – speculative one- to four-family	—		212		212		—		10,779		10,779
Construction – commercial	—		338		338		—		24,051		24,051
Construction – multi-family	—		375		375		—		19,256		19,256
Construction – land development	—		67		67		—		1,803		1,803
Land	27		670		697		204		30,566		30,770
Consumer loans:
Home equity and second mortgage	—		623		623		603		39,587		40,190
Other	17		82		99		23		4,289		4,312
Commercial business loans	128		594		722		725		64,039		64,764
Total	$	172	$	9,518	$	9,690	$	5,937	$	893,213	$	899,150


	30–59 Days Past Due		60-89 Days Past Due		Non- Accrual (1)		Past Due 90 Days or More and Still Accruing		Total Past Due		Current		Total Loans
June 30, 2020
Mortgage loans:
One- to four-family	$	—	$	—	$	927	$	—	$	927	$	119,587	$	120,514
Multi-family	—		—		—		—		—		79,468		79,468
Commercial	—		537		875		—		1,412		454,042		455,454
Construction – custom and owner/builder	—		—		—		—		—		73,011		73,011
Construction – speculative one- to four- family	—		—		—		—		—		7,412		7,412
Construction – commercial	—		—		—		—		—		19,793		19,793
Construction – multi-family	—		—		—		—		—		14,430		14,430
Construction – land development	—		—		—		—		—		3,161		3,161
Land	—		—		185		—		185		26,824		27,009
Consumer loans:
Home equity and second mortgage	—		—		586		—		586		33,819		34,405
Other	—		—		10		—		10		3,542		3,552
Commercial business loans	—		—		432		—		432		71,154		71,586
SBA PPP loans	—		—		—		—		—		122,581		122,581
Total	$	—	$	537	$	3,015	$	—	$	3,552	$	1,028,824	$	1,032,376


September 30, 2019
Mortgage loans:
One- to four-family	$	—	$	286	$	699	$	—	$	985	$	131,676	$	132,661
Multi-family	—		—		—		—		—		76,036		76,036
Commercial	94		218		779		—		1,091		418,026		419,117
Construction – custom and owner/ builder	—		—		—		—		—		75,411		75,411
Construction – speculative one- to four- family	—		—		—		—		—		10,779		10,779
Construction – commercial	—		—		—		—		—		24,051		24,051
Construction – multi-family	—		—		—		—		—		19,256		19,256
Construction – land development	—		—		—		—		—		1,803		1,803
Land	5		193		204		—		402		30,368		30,770
Consumer loans:
Home equity and second mortgage	94		—		603		—		697		39,493		40,190
Other	—		—		23		—		23		4,289		4,312
Commercial business loans	—		2		725		—		727		64,037		64,764
Total	$	193	$	699	$	3,033	$	—	$	3,925	$	895,225	$	899,150

The Company uses credit risk grades which reflect the Company’s assessment of a loan’s risk or loss potential. The Company categorizes loans into risk grade categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information and current economic trends, among other factors such as the estimated fair value of the collateral. The Company uses the following definitions for credit risk ratings as part of the on-going monitoring of the credit quality of its loan portfolio:

Substandard: Substandard loans are defined as those loans that are inadequately protected by the current net worth and paying capacity of the obligor, or of the collateral pledged. Loans classified as substandard have a well-defined weakness or weaknesses that jeopardize the repayment of the debt. If the weakness or weaknesses are not corrected, there is the distinct possibility that some loss will be sustained.

Loss: Loans in this classification are considered uncollectible and of such little value that continuance as bankable assets is not warranted. This classification does not mean that the loan has absolutely no recovery or salvage value, but rather it is not practical or desirable to defer writing off this loan even though partial recovery may be realized in the future. At June 30, 2020 and September 30, 2019, there were no loans classified as loss.


	Loan Grades
June 30, 2020	Pass		Watch		Special Mention		Substandard		Total
Mortgage loans:
One- to four-family	$	117,647	$	1,377	$	553	$	937	$	120,514
Multi-family	79,468		—		—		—		79,468
Commercial	445,544		7,936		572		1,402		455,454
Construction – custom and owner/builder	72,208		803		—		—		73,011
Construction – speculative one- to four-family	7,412		—		—		—		7,412
Construction – commercial	19,793		—		—		—		19,793
Construction – multi-family	14,430		—		—		—		14,430
Construction – land development	3,035		—		—		126		3,161
Land	24,713		1,527		584		185		27,009
Consumer loans:
Home equity and second mortgage	33,867		54		—		484		34,405
Other	3,510		32		—		10		3,552
Commercial business loans	70,797		225		76		488		71,586
SBA PPP loans	122,581		—		—		—		122,581
Total	$	1,015,005	$	11,954	$	1,785	$	3,632	$	1,032,376

September 30, 2019
Mortgage loans:
One- to four-family	$	129,748	$	296	$	562	$	2,055	$	132,661
Multi-family	76,036		—		—		—		76,036
Commercial	405,165		11,944		683		1,325		419,117
Construction – custom and owner/builder	75,178		233		—		—		75,411
Construction – speculative one- to four-family	10,779		—		—		—		10,779
Construction – commercial	24,051		—		—		—		24,051
Construction – multi-family	19,256		—		—		—		19,256
Construction – land development	1,659		—		—		144		1,803
Land	28,390		952		1,217		211		30,770
Consumer loans:
Home equity and second mortgage	39,364		41		—		785		40,190
Other	4,257		33		—		22		4,312
Commercial business loans	63,669		232		85		778		64,764
Total	$	877,552	$	13,731	$	2,547	$	5,320	$	899,150

A loan is considered impaired when it is probable that the Company will be unable to collect all amounts (principal and interest) when due according to the contractual terms of the loan agreement. Smaller balance homogeneous loans, such as residential mortgage loans and consumer loans, may be collectively evaluated for impairment. When a loan has been identified as being impaired, the amount of the impairment is measured by using discounted cash flows, except when, as an alternative, the current estimated fair value of the collateral (reduced by estimated costs to sell, if applicable) or observable market price is used. The valuation of real estate collateral is subjective in nature and may be adjusted in future periods because of changes in economic conditions. Management considers third-party appraisals, as well as independent fair market value assessments from realtors or persons involved in selling real estate, in determining the estimated fair value of particular properties. In addition, as certain of these third-party appraisals and independent fair market value assessments are only updated periodically, changes in the values of specific properties may have occurred subsequent to the most recent appraisals. Accordingly, the amounts of any such potential changes and any related adjustments are generally recorded at the time such information is received. When the estimated net realizable value of the impaired loan is less than the recorded investment in the loan (including accrued interest and net deferred loan origination fees or costs), impairment is recognized by creating or adjusting an allocation of the allowance for loan losses and uncollected accrued interest is reversed against interest income. If ultimate collection of principal is in doubt, all cash receipts on impaired loans are applied to reduce the principal balance.


	Recorded Investment		Unpaid Principal Balance (Loan Balance Plus Charge Off)		Related Allowance		Quarter to Date ("QTD") Average Recorded Investment (1)		Year to Date ("YTD") Average Recorded Investment (2)		QTD Interest Income Recognized (1)		YTD Interest Income Recognized (2)		QTD Cash Basis Interest Income Recognized (1)		YTD Cash Basis Interest Income Recognized (2)
With no related allowance recorded:
Mortgage loans:
One- to four-family	$	1,411	$	1,454	$	—	$	1,176	$	1,244	$	15	$	36	$	7	$	25

Commercial	3,267		3,267		—		3,303		3,234		41		92		32		74




Land	53		103		—		55		58		—		—		—		—
Consumer loans:
Home equity and second mortgage	586		586		—		584		588		—		—		—		—
Other	10		10		—		11		5		—		—		—		—
Commercial business loans	184		184		—		164		175		—		—		—		—
Subtotal	5,511		5,604		—		5,293		5,304		56		128		39		99

With an allowance recorded:
Mortgage loans:
One- to four-family	—		—		—		243		121		—		—		—		—






Land	132		132		25		134		137		—		—		—		—
Consumer loans:

Other	—		—		—		—		9		—		—		—		—
Commercial business loans	248		248		38		324		400		—		—		—		—
Subtotal	380		380		63		701		667		—		—		—		—

Total:
Mortgage loans:
One- to four-family	1,411		1,454		—		1,419		1,365		15		36		7		25

Commercial	3,267		3,267		—		3,303		3,234		41		92		32		74




Land	185		235		25		189		195		—		—		—		—
Consumer loans:
Home equity and second mortgage	586		586		—		584		588		—		—		—		—
Other	10		10		—		11		14		—		—		—		—
Commercial business loans	432		432		38		488		575		—		—		—		—
Total	$	5,891	$	5,984	$	63	$	5,994	$	5,971	$	56	$	128	$	39	$	99


	Recorded Investment		Unpaid Principal Balance (Loan Balance Plus Charge Off)		Related Allowance		YTD Average Recorded Investment (1)		YTD Interest Income Recognized (1)		YTD Cash Basis Interest Income Recognized (1)
With no related allowance recorded:
Mortgage loans:
One- to four-family	$	1,192	$	1,236	$	—	$	1,110	$	71	$	62

Commercial	3,190		3,190		—		2,920		227		192




Land	63		126		—		100		3		3
Consumer loans:
Home equity and second mortgage	603		603		—		459		—		—

Commercial business loans	189		291		—		142		30		30
Subtotal	5,237		5,446		—		4,731		331		287

With an allowance recorded:
Mortgage loans:







Land	141		141		27		246		—		—
Consumer loans:

Other	23		23		17		10		—		—
Commercial business loans	536		536		128		350		30		30
Subtotal	700		700		172		606		30		30
Total
Mortgage loans:
One- to four-family	1,192		1,236		—		1,110		71		62

Commercial	3,190		3,190		—		2,920		227		192




Land	204		267		27		346		3		3
Consumer loans:
Home equity and second mortgage	603		603		—		459		—		—
Other	23		23		17		10		—		—
Commercial business loans	725		827		128		492		60		60
Total	$	5,937	$	6,146	$	172	$	5,337	$	361	$	317

A troubled debt restructured loan ("TDR") is a loan for which the Company, for reasons related to a borrower’s financial difficulties, grants a concession to the borrower that the Company would not otherwise consider. Examples of such concessions include, but are not limited to: a reduction in the stated interest rate; an extension of the maturity at an interest rate below current market rates; a reduction in the face amount of the debt; a reduction in the accrued interest; or re-amortizations, extensions, deferrals and renewals. TDRs are considered impaired and are individually evaluated for impairment. TDRs are classified as non-accrual (and considered to be non-performing) unless they have been performing in accordance with modified terms for a period of at least six months. The Company had $3.08 million and $3.27 million in TDRs included in impaired loans at June 30, 2020 and September 30, 2019, respectively, and had no commitments at these dates to lend additional funds on these loans. The allowance for loan losses allocated to TDRs at June 30, 2020 and September 30, 2019 was $25,000 and $56,000, respectively. There were no TDRs for which there was a payment default within the first 12 months of the modification during the three months ended June 30, 2020.

The Coronavirus Aid, Relief, and Economic Security Act of 2020 signed into law on March 27, 2020 ("CARES Act") provided guidance around the modification of loans as a result of the COVID-19 pandemic, which outlined, among other criteria, that short-term modifications made on a good faith basis to borrowers who were current as defined under the CARES Act prior to any relief, are not TDRs. This includes short-term (e.g. six months) modifications such as payment deferrals, fee waivers,

extensions of repayment terms, or other delays in payment that are insignificant. Borrowers are considered current under the CARES Act and related regulatory guidance if they are less than 30 days past due on their contractual payments at the time a modification program is implemented. As of June 30, 2020, the Company had approved COVID-19 pandemic related loan modifications for 209 loans aggregating to $135.83 million, or 13.2% of loans receivable. Loan modifications in accordance with the CARES Act and related regulatory guidance are still subject to an evaluation in regard to determining whether or not a loan is deemed to be impaired. See Note 11 - Recent Accounting Pronouncements.


COVID-19 Loan Modifications
Mortgage loans	Count	Balance		Percent
One- to four-family	15	$	6,760	5.0	%
Multi-family	3	2,900		2.1
Commercial	114	105,680		77.8
Construction	2	2,924		2.2
Land	7	2,996		2.2
Total mortgage loans	141	121,260		89.3

Consumer loans
Home equity and second mortgage	6	307		0.2
Other	4	75		0.1
Total consumer loans	10	382		0.3

Commercial loans	58	14,191		10.4
Total COVID-19 Modifications	209	$	135,833	100.0	%