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Loans Held For Investment
 12 Months Ended
Jun. 30, 2015
Loans and Leases Receivable Disclosure [Abstract]  
Loans Held For Investment
Loans Held for Investment
 
Loans held for investment consisted of the following at June 30, 2015 and 2014:
(In Thousands)
June 30, 2015
June 30,
2014
Mortgage loans:
 
 
Single-family
$
365,961

$
377,824

Multi-family
347,020

301,191

Commercial real estate
100,897

96,781

Construction
8,191

2,869

Commercial business loans
666

1,237

Consumer loans
244

306

Total loans held for investment, gross
822,979

780,208

 
 
 
Undisbursed loan funds
(3,360
)
(1,090
)
Advance payments of escrows
199

215

Deferred loan costs, net
3,140

2,552

Allowance for loan losses
(8,724
)
(9,744
)
Total loans held for investment, net
$
814,234

$
772,141



As of June 30, 2015, the Corporation had $14.1 million in mortgage loans that were subject to negative amortization, consisting of $10.7 million in multi-family loans, $3.2 million in single-family loans and $227,000 in commercial real estate loans. This compares to $23.3 million of negative amortization mortgage loans at June 30, 2014, consisting of $18.7 million in multi-family loans, $3.7 million in single-family loans and $856,000 in commercial real estate loans.  During fiscal 2015 and 2014, no interest income was added to the negative amortization loan balance.  Negative amortization involves a greater risk to the Corporation because the loan principal balance may increase by a range of 110% to 115% of the original loan amount during the period of negative amortization and because the loan payment may increase beyond the means of the borrower when loan principal amortization is required.  Also, the Corporation 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, 2015 and 2014, the interest-only ARM loans totaled $152.6 million and $170.7 million, or 18.6% and 21.8% of gross loans held for investment, respectively. As of June 30, 2015, the Corporation had $4.5 million of single-family loans, 13 loans, held for investment which were originated for sale but were subsequently transferred to held for investment and are carried at fair value.

The following table sets forth information at June 30, 2015 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.  Fixed-rate loans comprised 4% of loans held for investment at June 30, 2015 and June 30, 2014.  Adjustable rate loans having no stated repricing dates that 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 Corporation’s actual repricing experience to differ materially from that shown.
 
Adjustable Rate
 
 
(In Thousands)
Within One Year
After
One Year
Through 3 Years
After
3 Years
Through 5 Years
After
5 Years
Through 10 Years
Fixed Rate
Total
Mortgage loans:
 
 
 
 
 
 
Single-family
$
299,507

$
4,175

$
45,742

$
2,889

$
13,648

$
365,961

Multi-family
65,323

83,282

187,790

6,050

4,575

347,020

Commercial real estate
19,520

27,039

45,102

—

9,236

100,897

Construction
1,200

—

1,744

—

5,247

8,191

Commercial business loans
289

—

119

—

258

666

Consumer loans
236

—

—

—

8

244

Total loans held for investment, gross
$
386,075

$
114,496

$
280,497

$
8,939

$
32,972

$
822,979



The Corporation has developed an internal loan grading system to evaluate and quantify the Bank’s loans held for investment portfolio with respect to quality and risk. Management continually evaluates the credit quality of the Corporation’s loan portfolio and conducts a quarterly review of the adequacy of the allowance for loan losses using quantitative and qualitative methods. The Corporation has adopted an internal risk rating policy in which each loan is rated for credit quality with a rating of pass, special mention, substandard, doubtful or loss. The two primary components that are used during the loan review process to determine the proper allowance levels are individually evaluated allowances and collectively evaluated allowances. Quantitative loan loss factors are developed by determining the historical loss experience, expected future cash flows, discount rates and collateral fair values, among others. Qualitative loan loss factors are developed by assessing general economic indicators such as Gross Domestic Product, Retail Sales, Unemployment Rates, Employment Growth, California Home Sales and Median California Home Prices. The Corporation assigns individual factors for the quantitative and qualitative methods for each loan category and each internal risk rating.

The Corporation categorizes all of the loans held for investment into risk categories based on relevant information about the ability of the borrower to service their debt such as current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. A description of the general characteristics of the risk grades is as follows:
 
▪
Pass - These loans range from minimal credit risk to average however still acceptable credit risk. The likelihood of loss is considered remote.
▪
Special Mention - A special mention asset has potential weaknesses that may be temporary or, if left uncorrected, may result in a loss. While concerns exist, the Bank is currently protected and loss is considered unlikely and not imminent.
▪
Substandard - A substandard loan is inadequately protected by the current sound worth and paying capacity of the borrower or of the collateral pledged, if any. Loans so classified must have a well-defined weakness, or weaknesses, that may jeopardize the liquidation of the debt. A substandard loan is characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected.
▪
Doubtful - A doubtful loan has all of the weaknesses inherent in one classified as substandard with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of the currently existing facts, conditions and values, highly questionable and improbable.
▪
Loss - A loss loan is considered uncollectible and of such little value that continuance as an asset of the institution is not warranted.

The following tables summarize gross loans held for investment by loan types and risk category at the dates indicated:
 
 
June 30, 2015
(In Thousands)
Single-family
Multi-family
Commercial Real Estate
Construction
Commercial Business
Consumer
Total
 
 
 
 
 
 
 
 
 
Pass
$
347,301

$
339,093

$
98,254

$
8,191

$
557

$
244

$
793,640

Special Mention
7,766

413

—

—

—

—

8,179

Substandard
10,894

7,514

2,643

—

109

—

21,160

 
Total loans held for
   investment, gross
$
365,961

$
347,020

$
100,897

$
8,191

$
666

$
244

$
822,979


 
 
June 30, 2014
(In Thousands)
Single-family
Multi-family
Commercial Real Estate
Construction
Commercial Business
Consumer
Total
 
 
 
 
 
 
 
 
 
Pass
$
363,440

$
285,111

$
90,431

$
2,869

$
1,078

$
306

$
743,235

Special Mention
2,140

7,256

—

—

22

—

9,418

Substandard
12,244

8,824

6,350

—

137

—

27,555

 
Total loans held for
   investment, gross
$
377,824

$
301,191

$
96,781

$
2,869

$
1,237

$
306

$
780,208



The allowance for loan losses is maintained at a level sufficient to provide for estimated losses based on evaluating known and inherent risks in the loans held for investment and upon management’s continuing analysis of the factors underlying the quality of the loans held for investment.  These factors include changes in the size and composition of the loans held for investment, actual loan loss experience, current economic conditions, detailed analysis of individual loans for which full collectability may not be assured, and determination of the realizable value of the collateral securing the loans.  Provisions (recoveries) for loan losses are charged (credited) against operations on a quarterly basis, as necessary, to maintain the allowance at appropriate levels.  Although management believes it uses the best information available to make such determinations, there can be no assurance that regulators, in reviewing the Corporation’s loans held for investment, will not request the Corporation to significantly increase its allowance for loan losses.  Future adjustments to the allowance for loan losses may be necessary and results of operations could be significantly and adversely affected as a result of economic, operating, regulatory, and other conditions beyond the Corporation’s control.

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 loans that were modified from their original terms, were re-underwritten and identified in the Corporation's asset quality reports as restructured loans, the charge-off occurs when the loan 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.  The allowance for loan losses for non-performing loans is determined by applying ASC 310, “Receivables.”  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 still in their restructuring period, classified lower than pass, and containing an embedded loss component 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. For non-performing commercial real estate loans, individually evaluated allowances are calculated based on their fair values and if their fair values are higher than their loan balances, no allowances are required.

The following tables summarize the Corporation’s allowance for loan losses and recorded investment in gross loans, by portfolio type, at the dates and for the periods indicated.
 
 
Year Ended June 30, 2015
(In Thousands)
Single-family
Multi-family
Commercial Real Estate
Construction
Commercial Business
Consumer
Total
 
 
 
 
 
 
 
 
 
Allowance at beginning of period
$
5,476

$
3,142

$
989

$
35

$
92

$
10

$
9,744

(Recovery) provision for loan losses
(279
)
(882
)
(182
)
7

(49
)
(2
)
(1,387
)
Recoveries
635

360

—

—

—

1

996

Charge-offs
(552
)
(4
)
(73
)
—

—

—

(629
)
 
Allowance for loan losses, end of
  period
$
5,280

$
2,616

$
734

$
42

$
43

$
9

$
8,724

 
 
 
 
 
 
 
 
 
Allowance:
 
 
 
 
 
 
 
Individually evaluated for impairment
$
78

$
—

$
—

$
—

$
20

$
—

$
98

Collectively evaluated for impairment
5,202

2,616

734

42

23

9

8,626

 
Allowance for loan losses, end of
  period
$
5,280

$
2,616

$
734

$
42

$
43

$
9

$
8,724

 
 
 
 
 
 
 
 
 
Gross Loans:
 
 
 
 
 
 
 
Individually evaluated for impairment
$
7,949

$
2,246

$
1,699

$
—

$
109

$
—

$
12,003

Collectively evaluated for impairment
358,012

344,774

99,198

8,191

557

244

810,976

 
Total loans held for investment,
  gross
$
365,961

$
347,020

$
100,897

$
8,191

$
666

$
244

$
822,979

Allowance for loan losses as a
  percentage of gross loans held for
  investment
1.44
%
0.75
%
0.73
%
0.51
%
6.46
%
3.69
%
1.06
%

 
 
Year Ended June 30, 2014
(In Thousands)
Single-family
Multi-family
Commercial Real Estate
Construction
Commercial Business
Consumer
Total
 
 
 
 
 
 
 
 
 
Allowance at beginning of period
$
9,062

$
4,689

$
1,053

$
—

$
119

$
12

$
14,935

(Recovery) provision for loan losses
(3,183
)
(130
)
(64
)
15

(18
)
—

(3,380
)
Recoveries
562

345

—

20

—

2

929

Charge-offs
(965
)
(1,762
)
—

—

(9
)
(4
)
(2,740
)
 
Allowance for loan losses, end of
  period
$
5,476

$
3,142

$
989

$
35

$
92

$
10

$
9,744

 
 
 
 
 
 
 
 
 
Allowance:
 
 
 
 
 
 
 
Individually evaluated for impairment
$
—

$
—

$
—

$
—

$
41

$
—

$
41

Collectively evaluated for impairment
5,476

3,142

989

35

51

10

9,703

 
Allowance for loan losses, end of
  period
$
5,476

$
3,142

$
989

$
35

$
92

$
10

$
9,744

 
 
 
 
 
 
 
 
 
Gross Loans:
 
 
 
 
 
 
 
Individually evaluated for impairment
$
6,067

$
2,491

$
2,352

$
—

$
122

$
—

$
11,032

Collectively evaluated for impairment
371,757

298,700

94,429

2,869

1,115

306

769,176

 
Total loans held for investment,
  gross
$
377,824

$
301,191

$
96,781

$
2,869

$
1,237

$
306

$
780,208

Allowance for loan losses as a
  percentage of gross loans held for
  investment
1.45
%
1.04
%
1.02
%
1.22
%
7.44
%
3.27
%
1.25
%



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,
2015
 
2014
 
2013
 
 
 
 
 
 
 
 
Balance, beginning of year
$
9,744

 
$
14,935

 
$
21,483

 
Recovery from the allowance for loan losses
(1,387
)
 
(3,380
)
 
(1,499
)
 
Recoveries
996

 
929

 
762

 
Charge-offs
(629
)
 
(2,740
)
 
(5,811
)
 
Balance, end of year
$
8,724

 
$
9,744

 
$
14,935

 


The following tables identify the Corporation’s total recorded investment in non-performing loans by type at the dates and for the periods indicated. Generally, a loan is placed on non-accrual status when it becomes 90 days past due as to principal or interest or if the loan is deemed impaired, after considering economic and business conditions and collection efforts, where the borrower’s financial condition is such that collection of the contractual principal or interest on the loan is doubtful. In addition, interest income is not recognized on any loan where management has determined that collection is not reasonably assured. A non-performing loan may be restored to accrual status when delinquent principal and interest payments are brought current and future monthly principal and interest payments are expected to be collected on a timely basis. Loans with a related allowance reserve have been individually evaluated for impairment using either a discounted cash flow analysis or, for collateral dependent loans, current appraisals less costs to sell to establish realizable value. These analysis may identify a specific impairment amount needed or may conclude that no reserve is needed. Loans that are not individually evaluated for impairment are included in pools of homogeneous loans for evaluation of related allowance reserves.
 
 
 
At or For the Year Ended June 30, 2015
 
 
 
Unpaid
 
 
 
Net
Average
Interest
 
 
 
Principal
Related
Recorded
 
Recorded
Recorded
Income
(In Thousands)
Balance
Charge-offs
Investment
Allowance(1)
Investment
Investment
Recognized
 
 
 
 
 
 
 
 
 
 
Mortgage loans:
 
 
 
 
 
 
 
 
Single-family:
 
 
 
 
 
 
 
 
 
With a related allowance
$
3,881

$
—

$
3,881

$
(630
)
$
3,251

$
1,869

$
109

 
 
Without a related allowance(2)
8,462

(1,801
)
6,661

—

6,661

6,956

83

 
Total single-family
12,343

(1,801
)
10,542

(630
)
9,912

8,825

192

 
 
 
 
 
 
 
 
 
 
 
Multi-family:
 
 
 
 
 
 
 
 
 
With a related allowance
—

—

—

—

—

113

13

 
 
Without a related allowance(2)
3,506

(1,260
)
2,246

—

2,246

2,331

5

 
Total multi-family
3,506

(1,260
)
2,246

—

2,246

2,444

18

 
 
 
 
 
 
 
 
 
 
 
Commercial real estate:
 
 
 
 
 
 
 
 
 
Without a related allowance(2)
1,699

—

1,699

—

1,699

1,830

170

 
Total commercial real estate
1,699

—

1,699

—

1,699

1,830

170

 
 
 
 
 
 
 
 
 
 
Commercial business loans:
 
 
 
 
 
 
 
 
With a related allowance
109

—

109

(20
)
89

121

9

Total commercial business loans
109

—

109

(20
)
89

121

9

 
 
 
 
 
 
 
 
 
 
Total non-performing loans
$
17,657

$
(3,061
)
$
14,596

$
(650
)
$
13,946

$
13,220

$
389


(1) Consists of collectively and individually evaluated allowances, specifically assigned to the individual loan.
(2) There was no related allowance for loan losses because the loans have been charged-off to their fair value or the fair value of the collateral is higher than the loan balance.


 
 
 
At or For the Year Ended June 30, 2014
 
 
 
Unpaid
 
 
 
Net
Average
Interest
 
 
 
Principal
Related
Recorded
 
Recorded
Recorded
Income
(In Thousands)
Balance
Charge-offs
Investment
Allowance(1)
Investment
Investment
Recognized
 
 
 
 
 
 
 
 
 
 
Mortgage loans:
 
 
 
 
 
 
 
 
Single-family:
 
 
 
 
 
 
 
 
 
With a related allowance
$
5,480

$
—

$
5,480

$
(1,148
)
$
4,332

$
5,795

$
162

 
 
Without a related allowance(2)
8,208

(2,141
)
6,067

—

6,067

6,094

89

 
Total single-family
13,688

(2,141
)
11,547

(1,148
)
10,399

11,889

251

 
 
 
 
 
 
 
 
 
 
 
Multi-family:
 
 
 
 
 
 
 
 
 
With a related allowance
956

—

956

(354
)
602

994

57

 
 
Without a related allowance(2)
4,146

(1,655
)
2,491

—

2,491

2,716

73

 
Total multi-family
5,102

(1,655
)
3,447

(354
)
3,093

3,710

130

 
 
 
 
 
 
 
 
 
 
 
Commercial real estate:
 
 
 
 
 
 
 
 
 
With a related allowance
—

—

—

—

—

—

28

 
 
Without a related allowance(2)
2,352

—

2,352

—

2,352

3,215

312

 
Total commercial real estate
2,352

—

2,352

—

2,352

3,215

340

 
 
 
 
 
 
 
 
 
 
Commercial business loans:
 
 
 
 
 
 
 
 
With a related allowance
138

—

138

(46
)
92

183

17

 
Without a related allowance(2)
—

—

—

—

—

—

5

Total commercial business loans
138

—

138

(46
)
92

183

22

 
 
 
 
 
 
 
 
 
 
Total non-performing loans
$
21,280

$
(3,796
)
$
17,484

$
(1,548
)
$
15,936

$
18,997

$
743


(1) Consists of collectively and individually evaluated allowances, specifically assigned to the individual loan.
(2) There was no related allowance for loan losses because the loans have been charged-off to their fair value or the fair value of the collateral is higher than the loan balance.

At June 30, 2015 and 2014, there were no commitments to lend additional funds to those borrowers whose loans were classified as non-performing.

The following tables denote the past due status of the Corporation's loans held for investment, gross, at the dates indicated.
 
 
June 30, 2015
(In Thousands)
Current
30-89 Days Past Due
Non-Accrual(1)
Total Loans Held for Investment, Gross
 
 
 
 
 
 
Mortgage loans:
 
 
 
 
 
Single-family
$
354,082

$
1,335

$
10,544

$
365,961

 
Multi-family
344,774

—

2,246

347,020

 
Commercial real estate
99,198

—

1,699

100,897

 
Construction
8,191

—

—

8,191

Commercial business loans
557

—

109

666

Consumer loans
244

—

—

244

 
Total loans held for investment, gross
$
807,046

$
1,335

$
14,598

$
822,979


(1) All loans 90 days or greater past due are placed on non-accrual status.
 
 
June 30, 2014
(In Thousands)
Current
30-89 Days Past Due
Non-Accrual(1)
Total Loans Held for Investment, Gross
 
 
 
 
 
 
Mortgage loans:
 
 
 
 
 
Single-family
$
365,955

$
322

$
11,547

$
377,824

 
Multi-family
297,744

—

3,447

301,191

 
Commercial real estate
94,429

—

2,352

96,781

 
Construction
2,869

—

—

2,869

Commercial business loans
1,099

—

138

1,237

Consumer loans
306

—

—

306

 
Total loans held for investment, gross
$
762,402

$
322

$
17,484

$
780,208

 
(1) All loans 90 days or greater past due are placed on non-accrual status.

During the fiscal years ended June 30, 2015, 2014 and 2013, the Corporation’s average investment in non-performing loans was $13.2 million, $19.0 million and $24.2 million, respectively.  The Corporation records payments on non-performing loans utilizing the cash basis or cost recovery method of accounting during the periods when the loans are on non-performing status.  For the fiscal years ended June 30, 2015, 2014 and 2013, interest income of $389,000, $546,000 and $885,000, respectively, was recognized, based on cash receipts from loan payments on non-performing loans.  Foregone interest income, which would have been recorded had the non-performing loans been current in accordance with their original terms, amounted to $101,000 , $800,000 and $878,000 for the fiscal years ended June 30, 2015, 2014 and 2013, respectively, and was not included in the loan interest income; while $380,000, $498,000 and $542,000, respectively, was collected and applied to reduce the net loan balances.

The effect of the non-performing loans on interest income for the years ended June 30, 2015, 2014 and 2013 is presented below:
(In Thousands)
Year Ended June 30,
2015
 
2014
 
2013
 
 
 
 
 
 
 
 
Contractual interest due
$
805

 
$
1,346

 
$
1,763

 
Interest collected
(704
)
 
(546
)
 
(885
)
 
Net foregone interest
$
101

 
$
800

 
$
878

 


For the fiscal year ended June 30, 2015, there were no loans that were newly modified from their original terms, re-underwritten or identified as a restructured loan.  This compares to one loan with an outstanding balance of $221,000 that was newly modified from its original terms, re-underwritten and identified as a restructured loan which subsequently paid off in fiscal 2014.  During the fiscal year ended June 30, 2015 and 2014, no restructured loans were in default within a 12-month period subsequent to their original restructuring.  Additionally, during the fiscal year ended June 30, 2015, there was one restructured loan for $113,000 whose modification was extended beyond the initial maturity of the modification.  For the fiscal year ended June 30, 2014, two restructured loans with a total balance of $810,000 had their modification extended beyond the initial maturity of the modification.

As of June 30, 2015, the net outstanding balance of the Corporation's 18 restructured loans was $6.6 million:  two were classified as special mention and remain on accrual status ($989,000); and 16 were classified as substandard ($5.6 million, all on non-accrual status).  As of June 30, 2015, $4.9 million, or 74 percent, of the restructured loans were current with respect to their payment status. As of June 30, 2014, the net outstanding balance the Corporation's 17 restructured loans was $6.0 million: one loan was classified as special mention and remains on accrual status ($343,000); and 16 loans were classified as substandard ($5.6 million, all on non-accrual status). As of June 30, 2014, $3.7 million, 62 percent, of the restructured loans had a current payment status.

The following table summarizes at the dates indicated the restructured loan balances, net of allowance for loan losses or charge-offs, by loan type and non-accrual versus accrual status at June 30, 2015 and 2014:
(In Thousands)
June 30, 2015
June 30, 2014
Restructured loans on non-accrual status:
 
 
Mortgage loans:
 
 
Single-family
$
2,902

$
2,957

Multi-family
1,593

1,760

Commercial real estate
1,019

800

Commercial business loans
89

92

Total
5,603

5,609

 
 
 
Restructured loans on accrual status:
 

 

Mortgage loans:
 

 

Single-family
989

343

Total
989

343

Total restructured loans
$
6,592

$
5,952

The following table shows the restructured loans by type, net of allowance for loan losses or charge-offs, at June 30, 2015 and 2014:
 
 
 
At June 30, 2015
 
 
 
Unpaid
 
 
 
Net
 
 
 
Principal
Related
Recorded
 
Recorded
(In Thousands)
Balance
Charge-offs
Investment
Allowance(1)
Investment
 
 
 
 
 
 
 
 
Mortgage loans:
 
 
 
 
 
 
Single-family:
 
 
 
 
 
 
 
With a related allowance
$
576

$
—

$
576

$
(115
)
$
461

 
 
Without a related allowance(2)
4,397

(967
)
3,430

—

3,430

 
Total single-family
4,973

(967
)
4,006

(115
)
3,891

 
 
 
 
 
 
 
 
 
Multi-family:
 
 
 
 
 
 
 
Without a related allowance(2)
2,795

(1,202
)
1,593

—

1,593

 
Total multi-family
2,795

(1,202
)
1,593

—

1,593

 
 
 
 
 
 
 
 
 
Commercial real estate:
 
 
 
 
 
 
 
Without a related allowance(2)
1,019

—

1,019

—

1,019

 
Total commercial real estate
1,019

—

1,019

—

1,019

 
 
 
 
 
 
 
 
Commercial business loans:
 
 
 
 
 
 
With a related allowance
109

—

109

(20
)
89

Total commercial business loans
109

—

109

(20
)
89

 
 
 
 
 
 
 
 
Total restructured loans
$
8,896

$
(2,169
)
$
6,727

$
(135
)
$
6,592



(1) Consists of collectively and individually evaluated allowances, specifically assigned to the individual loan.
(2) There was no related allowance for loan losses because the loans have been charged-off to their fair value or the fair value of the collateral is higher than the loan balance.

 
 
 
At June 30, 2014
 
 
 
Unpaid
 
 
 
Net
 
 
 
Principal
Related
Recorded
 
Recorded
(In Thousands)
Balance
Charge-offs
Investment
Allowance(1)
Investment
 
 
 
 
 
 
 
 
Mortgage loans:
 
 
 
 
 
 
Single-family
 
 
 
 
 
 
 
With a related allowance
$
994

$
—

$
994

$
(248
)
$
746

 
 
Without a related allowance(2)
3,564

(1,010
)
2,554

—

2,554

 
Total single-family
4,558

(1,010
)
3,548

(248
)
3,300

 
 
 
 
 
 
 
 
 
Multi-family:
 
 
 
 
 
 
 
Without a related allowance(2)
3,138

(1,378
)
1,760

—

1,760

 
Total multi-family
3,138

(1,378
)
1,760

—

1,760

 
 
 
 
 
 
 
 
 
Commercial real estate:
 
 
 
 
 
 
 
Without a related allowance(2)
800

—

800

—

800

 
Total commercial real estate
800

—

800

—

800

 
 
 
 
 
 
 
 
Commercial business loans:
 
 
 
 
 
 
With a related allowance
138

—

138

(46
)
92

Total commercial business loans
138

—

138

(46
)
92

 
 
 
 
 
 
 
 
Total restructured loans
$
8,634

$
(2,388
)
$
6,246

$
(294
)
$
5,952


(1) Consists of collectively and individually evaluated allowances, specifically assigned to the individual loan.
(2) There was no related allowance for loan losses because the loans have been charged-off to their fair value or the fair value of the collateral is higher than the loan balance.

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,
2015
 
2014
 
2013
 
 
 
 
 
 
 
 
Balance, beginning of year
$
2,011

 
$
2,024

 
$
2,030

 
Originations
3,555

 
691

 
3,581

 
Sales and payments
(3,199
)
 
(704
)
 
(3,587
)
 
Balance, end of year
$
2,367

 
$
2,011

 
$
2,024

 


As of June 30, 2015 and 2014, all of the related-party loans were performing in accordance with their original contractual terms.