XML 52 R10.htm IDEA: XBRL DOCUMENT
v2.4.0.6

Loans Held for Investment | 12 Months Ended
--- | ---
Jun. 30, 2012
Loans Held for Investment: |
Loans Held for Investment |
3. | Loans Held for Investment:
Loans held for investment as of June 30, 2012 and 2011 consisted of the following:
(In Thousands) | June 30,
2012 |  | 2011 |
Mortgage loans: |  |  |  |
| Single-family | $ 439,024 |  | $ 494,192 |
| Multi-family | 278,057 |  | 304,808 |
| Commercial real estate | 95,302 |  | 103,637 |
| Other | 755 |  | 1,530 |
Commercial business loans | 2,580 |  | 4,526 |
Consumer loans | 506 |  | 750 |
| Total loans held for investment, gross | 816,224 |  | 909,443 |
Deferred loan costs, net | 2,095 |  | 2,649 |
Allowance for loan losses | (21,483 | ) | (30,482 | )
| Total loans held for investment, net | $ 796,836 |  | $ 881,610 |
Fixed-rate loans comprised 5% of loans held for investment at June 30, 2012 and 2011. As of June 30, 2012, the Bank had $40.2 million in mortgage loans that are subject to negative amortization, consisting of $26.7 million in multi-family loans, $7.0 million in commercial real estate loans and $6.5 million in single-family loans. This compares to $50.4 million of negative amortization mortgage loans at June 30, 2011, consisting of $31.3 million in multi-family loans, $11.5 million in commercial real estate loans and $7.6 million in single-family loans. The amount of negative amortization included in loan balances decreased to $137,000 at June 30, 2012 from $353,000 at June 30, 2011. During fiscal 2012, approximately $13,000, or 0.03%, of loan interest income was added to the negative amortization loan balance, down from $43,000, or 0.07% in fiscal 2011. Negative amortization involves a greater risk to the Bank because the loan principal balance may increase by a range of 110% to 115% of the original loan amount and because the loan payment may increase beyond the means of the borrower when loan principal amortization is required. Also, the Bank has originated interest-only ARM loans, which typically have a fixed interest rate for the first two to five years coupled with an interest only payment, followed by a periodic adjustable rate and a fully amortizing loan payment. As of June 30, 2012 and 2011, the interest-only ARM loans were $214.2 million and $247.8 million, or 26.2% and 27.2% of loans held for investment, respectively. In compliance with the OCC’s regulatory reporting requirements which do not recognize specific valuation allowances, the Bank modified its charge-off policy on non-performing loans during the quarter ended March 31, 2012 and, subsequent to the OCC’s review, the Bank further revised its charge-off policy in the quarter ended June 30, 2012. Historically, the Bank established a specific valuation allowance for non-performing loans under ASC 310 based upon the estimated fair value of the underlying collateral, less disposition costs, in comparison to the loan balance or used a discounted cash flow method for non-performing restructured loans. The specific valuation allowance was not charged-off until the foreclosure process was complete. Under the modified policy, non-performing loans are charged-off to their fair market values in the period the loans, or portion thereof, are deemed uncollectible, generally after the loan becomes 150 days delinquent for real estate secured first trust deed loans and 120 days delinquent for commercial business or real estate secured second trust deed loans. For restructured loans, the charge-off occurs when the loans becomes 90 days delinquent; and where borrowers file bankruptcy, the charge-off occurs when the loan becomes 60 days delinquent. The amount of the charge-off is determined by comparing the loan balance to the estimated fair value of the underlying collateral, less disposition costs, with the loan balance in excess of the estimated fair value charged-off against the allowance for loan losses. Both methods are acceptable under GAAP. The modification to the charge-off policy resulted in $3.01 million of additional charge-offs in the fourth quarter of fiscal 2012 and a total of $4.00 million of additional charge-offs for fiscal 2012, but had no impact to the allowance for loans losses or the provision for loan losses because these charge-offs were timely identified in previous periods as specific valuation allowances and were included in the Corporation’s loss experience as part of the evaluation of the allowance for loan losses in those prior periods. The allowance for loan losses for non-performing loans is determined by applying ASC 310. The change in method did not have a material impact to the allowance for loan losses. For restructured loans that are less than 90 days delinquent, the allowance for loan losses are segregated into (a) individually evaluated allowances for those loans with applicable discounted cash flow calculations or (b) collectively evaluated allowances based on the aggregated pooling method. For non-performing loans less than 60 days delinquent where the borrower has filed bankruptcy, the collectively evaluated allowances are assigned based on the aggregated pooling method. The following tables summarize the Corporation’s allowance for loan losses at June 30, 2012 and 2011:
| As of June 30, |
| 2012 |  | 2011 |
Collectively evaluated allowance: |  |  |  |
| Mortgage loans: |  |  |  |
|  | Single-family | $ 15,189 |  | $ 11,561 |
|  | Multi-family | 3,524 |  | 2,810 |
|  | Commercial real estate | 1,810 |  | 1,796 |
|  | Other | 7 |  | 5 |
| Commercial business loans | 169 |  | 178 |
| Consumer loans | 13 |  | 16 |
|  | Total collectively evaluated allowance | 20,712 |  | 16,366 |
Individually evaluated allowance: |  |  |  |
| Mortgage loans: |  |  |  |
|  | Single-family | 744 |  | 12,654 |
|  | Multi-family | 27 |  | 581 |
|  | Commercial real estate | - |  | 231 |
|  | Other | - |  | 321 |
| Commercial business loans | - |  | 329 |
|  | Total individually evaluated allowance | 771 |  | 14,116 |
Total loan loss allowance | $ 21,483 |  | $ 30,482 |
The following table sets forth information at June 30, 2012 regarding the dollar amount of loans held for investment that are contractually repricing during the periods indicated, segregated between adjustable rate loans and fixed rate loans. Adjustable rate loans having no stated repricing dates but reprice when the index they are tied to reprices (e.g. prime rate index) and checking account overdrafts are reported as repricing within one year. The table does not include any estimate of prepayments which may cause the Bank’s actual repricing experience to differ materially from that shown below.
|  | Adjustable Rate |  |
|  |  | After | After | After |  |
|  |  | One Year | 3 Years | 5 Years |  |
|  | Within | Through | Through | Through | Fixed |
(In Thousands) | One Year | 3 Years | 5 Years | 10 Years | Rate | Total
Mortgage loans: |  |  |  |  |  |
| Single-family | $ 408,777 | $ 12,896 | $ 7,796 | $ 2,627 | $ 6,928 | $ 439,024
| Multi-family | 186,144 | 17,563 | 49,026 | 10,980 | 14,344 | 278,057
| Commercial real estate | 62,483 | 3,993 | 10,048 | 1,836 | 16,942 | 95,302
| Other | 522 | - | - | - | 233 | 755
Commercial business loans | 1,170 | - | - | - | 1,410 | 2,580
Consumer loans | 484 | - | - | - | 22 | 506
| Total loans held for investment, gross | $ 659,580 | $ 34,452 | $ 66,870 | $ 15,443 | $ 39,879 | $ 816,224
Non-performing loans, which includes non-performing restructured loans, were $34.5 million and $37.1 million at June 30, 2012 and 2011, respectively. The effect of the non-performing loans on interest income for the years ended June 30, 2012, 2011 and 2010 is presented below:
(In Thousands) | Year Ended June 30,
2012 |  | 2011 |  | 2010 |
Contractual interest due | $ 2,432 |  | $ 3,605 |  | $ 8,907 |
Interest recognized | (1,556 | ) | (2,313 | ) | (5,103 | )
Net foregone interest | $ 876 |  | $ 1,292 |  | $ 3,804 |
The following tables identify the Corporation’s total recorded investment in non-performing loans by type, net of allowances for loan losses at June 30, 2012 and 2011:
(In Thousands) | June 30, 2012
Recorded Investment | Allowance for Loan Losses (1) | Net Investment
Mortgage loans: |  |  |  |  |
| Single-family: |  |  |  |  |
|  | With a related allowance | $ 26,214 |  | $ (5,476 | ) | $ 20,738
|  | Without a related allowance | 8,352 |  | - |  | 8,352
| Total single-family loans | 34,566 |  | (5,476 | ) | 29,090
| Multi-family: |  |  |  |  |
|  | With a related allowance | 1,806 |  | (349 | ) | 1,457
| Total multi-family loans | 1,806 |  | (349 | ) | 1,457
| Commercial real estate: |  |  |  |  |
|  | With a related allowance | 3,820 |  | (573 | ) | 3,247
| Total commercial real estate loans | 3,820 |  | (573 | ) | 3,247
| Other: |  |  |  |  |
|  | Without a related allowance | 522 |  | - |  | 522
| Total other loans | 522 |  | - |  | 522
Commercial business loans: |  |  |  |  |
|  | With a related allowance | 246 |  | (74 | ) | 172
| Total commercial business loans | 246 |  | (74 | ) | 172
Total non-performing loans | $ 40,960 |  | $ (6,472 | ) | $ 34,488
(1) | Consists of collectively and individually evaluated allowances.
(In Thousands) | June 30, 2011
Recorded Investment | Allowance for Loan Losses (1) | Net Investment
Mortgage loans: |  |  |  |  |
| Single-family: |  |  |  |  |
|  | With a related allowance | $ 42,957 |  | $ (12,654 | ) | $ 30,303
|  | Without a related allowance | 1,535 |  | - |  | 1,535
| Total single-family loans | 44,492 |  | (12,654 | ) | 31,838
| Multi-family: |  |  |  |  |
|  | With a related allowance | 2,534 |  | (581 | ) | 1,953
| Total multi-family loans | 2,534 |  | (581 | ) | 1,953
| Commercial real estate: |  |  |  |  |
|  | With a related allowance | 2,451 |  | (231 | ) | 2,220
| Total commercial real estate loans | 2,451 |  | (231 | ) | 2,220
| Other: |  |  |  |  |
|  | With a related allowance | 1,293 |  | (321 | ) | 972
| Total other loans | 1,293 |  | (321 | ) | 972
Commercial business loans: |  |  |  |  |
|  | With a related allowance | 331 |  | (329 | ) | 2
|  | Without a related allowance | 141 |  | - |  | 141
| Total commercial business loans | 472 |  | (329 | ) | 143
Total non-performing loans | $ 51,242 |  | $ (14,116 | ) | $ 37,126
(1) | Consists of specific valuation allowances.
At June 30, 2012 and 2011, there were no commitments to lend additional funds to those borrowers whose loans were classified as non-performing. The following table describes the aging analysis (length of time on non-performing status) of non-performing loans, net of allowance for loan losses, as of June 30, 2012 and 2011: As of June 30, 2012:
(In Thousands) | 3 Months or Less | Over 3 to 6 Months | Over 6 to 12 Months | Over 12 Months | Total
Mortgage loans: |  |  |  |  |
| Single-family | $ 8,291 | $ 6,877 | $ 3,141 | $ 10,781 | $ 29,090
| Multi-family | 967 | - | - | 490 | 1,457
| Commercial real estate | 1,002 | 1,735 | - | 510 | 3,247
| Other | - | - | - | 522 | 522
Commercial business loans | - | 131 | - | 41 | 172
| Total | $ 10,260 | $ 8,743 | $ 3,141 | $ 12,344 | $ 34,488
As of June 30, 2011:
(In Thousands) | 3 Months or Less | Over 3 to 6 Months | Over 6 to 12 Months | Over 12 Months | Total
Mortgage loans: |  |  |  |  |
| Single-family | $ 9,655 | $ 8,156 | $ 4,016 | $ 10,011 | $ 31,838
| Multi-family | - | - | - | 1,953 | 1,953
| Commercial real estate | 927 | 1,293 | - | - | 2,220
| Other | - | 972 | - | - | 972
Commercial business loans | - | - | 2 | 141 | 143
| Total | $ 10,582 | $ 10,421 | $ 4,018 | $ 12,105 | $ 37,126
During the years ended June 30, 2012, 2011 and 2010, the Corporation’s average investment in non-performing loans was $34.4 million, $50.2 million and $78.0 million, respectively. Interest income of $1.5 million, $2.3 million and $5.1 million was recognized, based on cash receipts, on non-performing loans during the years ended June 30, 2012, 2011 and 2010, respectively. The Corporation records interest on non-performing loans utilizing the cash basis method of accounting during the periods when the loans are on non-performing status. The following summarizes the components of the net change in the allowance for loan losses for the periods indicated:
(In Thousands) | Year Ended June 30,
2012 |  | 2011 |  | 2010 |
Balance, beginning of year | $ 30,482 |  | $ 43,501 |  | $ 45,445 |
Provision for loan losses | 5,777 |  | 5,465 |  | 21,843 |
Recoveries | 375 |  | 27 |  | 717 |
Charge-offs | (15,151 | ) | (18,511 | ) | (24,504 | )
Balance, end of year | $ 21,483 |  | $ 30,482 |  | $ 43,501 |
During the fiscal year ended June 30, 2012, 24 loans for $10.1 million were modified from their original terms, were re-underwritten at current market interest rates and were identified in the Corporation’s asset quality reports as restructured loans. This compares to 43 loans for $20.7 million that were modified in the fiscal year ended June 30, 2011. During the fiscal year ended June 30, 2012, two restructured loans with a total loan balance of $771,000 were in default within a 12-month period subsequent to their original restructuring and required an additional allowance for loan losses of $200,000. This compares to three restructured loans with a total loan balance of $1.2 million that were in default within a 12-month period subsequent to their original restructuring and required an additional allowance for loan losses of $316,000 in the fiscal year ended June 30, 2011. As of June 30, 2012, the outstanding balance of restructured loans was $25.1 million, comprised of 56 loans. These restructured loans are classified as follows: 12 loans are classified as pass, are not included in the classified asset totals and remain on accrual status ($5.5 million); three loans are classified as special mention and remain on accrual status ($4.0 million); and 41 loans are classified as substandard ($15.6 million, all are on non-accrual status). As of June 30, 2012, 74 percent, or $18.5 million of the restructured loans have a current payment status. The following table summarizes the restructured loans by loan type at June 30, 2012 and 2011:
| As of June 30,
(In Thousands) | 2012 |  | 2011 |
Restructured loans on non-accrual status: |  |  |  |
| Mortgage loans: |  |  |  |
|  | Single-family | $ 11,995 |  | $ 15,133 |
|  | Multi-family | 490 |  | 490 |
|  | Commercial real estate | 2,483 |  | 1,660 |
|  | Other | 522 |  | 972 |
| Commercial business loans | 165 |  | 143 |
|  | Total | 15,655 |  | 18,398 |
Restructured loans on accrual status: |  |  |  |
| Mortgage loans: |  |  |  |
|  | Single-family | 6,148 |  | 15,589 |
|  | Multi-family | 3,266 |  | 3,665 |
|  | Commercial real estate | - |  | 1,142 |
| Other | - |  | 237 |
| Commercial business loans | 33 |  | 125 |
|  | Total | 9,447 |  | 20,758 |
|  | Total restructured loans | $ 25,102 |  | $ 39,156 |
The following tables show the restructured loans by type, net of allowance for loan losses, at June 30, 2012 and 2011:
(In Thousands) | June 30, 2012
Recorded Investment | Allowance for Loan Losses (1) | Net Investment
Mortgage loans: |  |  |  |  |
| Single-family: |  |  |  |  |
|  | With a related allowance | $ 9,465 |  | $ (486 | ) | $ 8,979
|  | Without a related allowance | 9,164 |  | - |  | 9,164
| Total single-family loans | 18,629 |  | (486 | ) | 18,143
| Multi-family: |  |  |  |  |
|  | With a related allowance | 517 |  | (27 | ) | 490
|  | Without a related allowance | 3,266 |  | - |  | 3,266
| Total multi-family loans | 3,783 |  | (27 | ) | 3,756
| Commercial real estate: |  |  |  |  |
|  | With a related allowance | 2,921 |  | (438 | ) | 2,483
| Total commercial real estate loans | 2,921 |  | (438 | ) | 2,483
| Other: |  |  |  |  |
|  | Without a related allowance | 522 |  | - |  | 522
| Total other loans | 522 |  | - |  | 522
Commercial business loans: |  |  |  |  |
|  | With a related allowance | 236 |  | (71 | ) | 165
|  | Without a related allowance | 33 |  | - |  | 33
| Total commercial business loans | 269 |  | (71 | ) | 198
Total restructured loans | $ 26,124 |  | $ (1,022 | ) | $ 25,102
(1) | Consists of collectively and individually evaluated allowances.
(In Thousands) | June 30, 2011
Recorded Investment | Allowance for Loan Losses (1) | Net Investment
Mortgage loans: |  |  |  |  |
| Single-family: |  |  |  |  |
|  | With a related allowance | $ 19,092 |  | $ (3,959 | ) | $ 15,133
|  | Without a related allowance | 15,589 |  | - |  | 15,589
| Total single-family loans | 34,681 |  | (3,959 | ) | 30,722
| Multi-family: |  |  |  |  |
|  | With a related allowance | 517 |  | (27 | ) | 490
|  | Without a related allowance | 3,665 |  | - |  | 3,665
| Total multi-family loans | 4,182 |  | (27 | ) | 4,155
| Commercial real estate: |  |  |  |  |
|  | With a related allowance | 1,837 |  | (177 | ) | 1,660
|  | Without a related allowance | 1,142 |  | - |  | 1,142
| Total commercial real estate loans | 2,979 |  | (177 | ) | 2,802
| Other: |  |  |  |  |
|  | With a related allowance | 1,293 |  | (321 | ) | 972
|  | Without a related allowance | 237 |  | - |  | 237
| Total other loans | 1,530 |  | (321 | ) | 1,209
Commercial business loans: |  |  |  |  |
|  | With a related allowance | 53 |  | (51 | ) | 2
|  | Without a related allowance | 266 |  | - |  | 266
| Total commercial business loans | 319 |  | (51 | ) | 268
Total restructured loans | $ 43,691 |  | $ (4,535 | ) | $ 39,156
(1) | Consists of specific valuation allowances.
In the ordinary course of business, the Bank makes loans to its directors, officers and employees on substantially the same terms prevailing at the time of origination for comparable transactions with unaffiliated borrowers. The following is a summary of related-party loan activity:
(In Thousands) | Year Ended June 30,
2012 |  | 2011 |  | 2010 |
Balance, beginning of year | $ 2,036 |  | $ 2,341 |  | $ 2,300 |
Originations | 2,807 |  | 2,742 |  | 1,307 |
Sales and payments | (2,813 | ) | (3,047 | ) | (1,266 | )
Balance, end of year | $ 2,030 |  | $ 2,036 |  | $ 2,341 |
As of June 30, 2012, all of the related-party loans were performing in accordance with their original contractual terms.

X
- Details
Name: | fil_LoansHeldForInvestmentAbstract
Namespace Prefix: | fil_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for claims held for amounts due a entity, excluding financing receivables. Examples include, but are not limited to, trade accounts receivables, notes receivables, loans receivables. Includes disclosure for allowance for credit losses. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(k)) -URI http://asc.fasb.org/extlink&oid=6881521&loc=d3e23780-122690 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 02 -Paragraph 3, 4 -Article 5 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 310 -SubTopic 10 -Section 50 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=7512638&loc=d3e5074-111524 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 310 -SubTopic 10 -Section 50 -Paragraph 11 -URI http://asc.fasb.org/extlink&oid=7512638&loc=d3e5162-111524 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.3,4) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 08 -Paragraph k -Article 4 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher AICPA -Name Statement of Position (SOP) -Number 01-6 -Paragraph 13 -Subparagraph d -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 310 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=7512638&loc=d3e5066-111524 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 03 -Paragraph 7 -Article 9 + Details
Name: | us-gaap_LoansNotesTradeAndOtherReceivablesDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration