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Loans Held For Investment | 12 Months Ended
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Jun. 30, 2019
Loans and Leases Receivable Disclosure [Abstract] |
Loans Held For Investment | Note 3: Loans Held for Investment Loans held for investment consisted of the following at June 30, 2019 and 2018 :
(In Thousands) | June 30, 2019 | June 30, 2018
Mortgage loans: |  |
Single-family | $ | 324,952 |  | $ | 314,808 |
Multi-family | 439,041 |  | 476,008 |
Commercial real estate | 111,928 |  | 109,726 |
Construction | 4,638 |  | 3,174 |
Other | 167 |  | 167 |
Commercial business loans | 478 |  | 500 |
Consumer loans | 134 |  | 109 |
Total loans held for investment, gross | 881,338 |  | 904,492 |
Advance payments of escrows | 53 |  | 18 |
Deferred loan costs, net | 5,610 |  | 5,560 |
Allowance for loan losses | (7,076 | ) | (7,385 | )
Total loans held for investment, net | $ | 879,925 |  | $ | 902,685 |
The following table sets forth information at June 30, 2019 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 2% of loans held for investment at both June 30, 2019 and June 30, 2018. Adjustable rate loans having no stated repricing date 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 | $ | 97,426 |  | $ | 38,371 |  | $ | 117,809 |  | $ | 59,230 |  | $ | 12,116 |  | $ | 324,952 |
Multi-family | 116,357 |  | 164,462 |  | 135,239 |  | 22,795 |  | 188 |  | 439,041 |
Commercial real estate | 40,053 |  | 32,331 |  | 37,815 |  | 1,280 |  | 449 |  | 111,928 |
Construction | 3,919 |  | — |  | — |  | 60 |  | 659 |  | 4,638 |
Other | — |  | — |  | — |  | — |  | 167 |  | 167 |
Commercial business loans | 122 |  | — |  | — |  | — |  | 356 |  | 478 |
Consumer loans | 134 |  | — |  | — |  | — |  | — |  | 134 |
Total loans held for investment, gross | $ | 258,011 |  | $ | 235,164 |  | $ | 290,863 |  | $ | 83,365 |  | $ | 13,935 |  | $ | 881,338 |
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, among others. 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 Bank is not warranted.
The following tables summarize gross loans held for investment by loan types and risk category at the dates indicated:
|  | June 30, 2019
(In Thousands) | Single- family | Multi- family | Commercial Real Estate | Construction | Other Mortgage | Commercial Business | Consumer | Total
Pass | $ | 314,036 |  | $ | 435,177 |  | $ | 111,001 |  | $ | 3,667 |  | $ | 167 |  | $ | 429 |  | $ | 134 |  | $ | 864,611 |
Special Mention | 3,795 |  | 3,864 |  | 927 |  | — |  | — |  | — |  | — |  | 8,586 |
Substandard | 7,121 |  | — |  | — |  | 971 |  | — |  | 49 |  | — |  | 8,141 |
| Total loans held for investment, gross | $ | 324,952 |  | $ | 439,041 |  | $ | 111,928 |  | $ | 4,638 |  | $ | 167 |  | $ | 478 |  | $ | 134 |  | $ | 881,338 |
|  | June 30, 2018
(In Thousands) | Single- family | Multi- family | Commercial Real Estate | Construction | Other Mortgage | Commercial Business | Consumer | Total
Pass | $ | 304,619 |  | $ | 472,061 |  | $ | 108,786 |  | $ | 3,174 |  | $ | 167 |  | $ | 430 |  | $ | 109 |  | $ | 889,346 |
Special Mention | 2,548 |  | 3,947 |  | 940 |  | — |  | — |  | — |  | — |  | 7,435 |
Substandard | 7,641 |  | — |  | — |  | — |  | — |  | 70 |  | — |  | 7,711 |
| Total loans held for investment, gross | $ | 314,808 |  | $ | 476,008 |  | $ | 109,726 |  | $ | 3,174 |  | $ | 167 |  | $ | 500 |  | $ | 109 |  | $ | 904,492 |
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, 2019
(In Thousands) | Single- family | Multi- family | Commercial Real Estate | Construction | Other Mortgage | Commercial Business | Consumer | Total
Allowance at beginning of period | $ | 2,783 |  | $ | 3,492 |  | $ | 1,030 |  | $ | 47 |  | $ | 3 |  | $ | 24 |  | $ | 6 |  | $ | 7,385 |
Provision (recovery) for loan losses | (241 | ) | (273 | ) | 20 |  | 14 |  | — |  | — |  | 5 |  | (475 | )
Recoveries | 198 |  | — |  | — |  | — |  | — |  | 2 |  | — |  | 200 |
Charge-offs | (31 | ) | — |  | — |  | — |  | — |  | — |  | (3 | ) | (34 | )
| Allowance for loan losses, end of period | $ | 2,709 |  | $ | 3,219 |  | $ | 1,050 |  | $ | 61 |  | $ | 3 |  | $ | 26 |  | $ | 8 |  | $ | 7,076 |
Allowance: |  |  |  |  |  |  |  |
Individually evaluated for impairment | $ | 122 |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | 8 |  | $ | — |  | $ | 130 |
Collectively evaluated for impairment | 2,587 |  | 3,219 |  | 1,050 |  | 61 |  | 3 |  | 18 |  | 8 |  | 6,946 |
| Allowance for loan losses, end of period | $ | 2,709 |  | $ | 3,219 |  | $ | 1,050 |  | $ | 61 |  | $ | 3 |  | $ | 26 |  | $ | 8 |  | $ | 7,076 |
Gross Loans: |  |  |  |  |  |  |  |
Individually evaluated for impairment | $ | 5,199 |  | $ | — |  | $ | — |  | $ | 971 |  | $ | — |  | $ | 49 |  | $ | — |  | $ | 6,219 |
Collectively evaluated for impairment | 319,753 |  | 439,041 |  | 111,928 |  | 3,667 |  | 167 |  | 429 |  | 134 |  | 875,119 |
| Total loans held for investment, gross | $ | 324,952 |  | $ | 439,041 |  | $ | 111,928 |  | $ | 4,638 |  | $ | 167 |  | $ | 478 |  | $ | 134 |  | $ | 881,338 |
Allowance for loan losses as a percentage of gross loans held for investment | 0.83 | % | 0.73 | % | 0.94 | % | 1.32 | % | 1.80 | % | 5.44 | % | 5.97 | % | 0.80 | %
|  | Year Ended June 30, 2018
(In Thousands) | Single- family | Multi- family | Commercial Real Estate | Construction | Other Mortgage | Commercial Business | Consumer | Total
Allowance at beginning of period | $ | 3,601 |  | $ | 3,420 |  | $ | 879 |  | $ | 96 |  | $ | — |  | $ | 36 |  | $ | 7 |  | $ | 8,039 |
Provision (recovery) for loan losses | (704 | ) | 72 |  | 151 |  | (49 | ) | 3 |  | (12 | ) | 3 |  | (536 | )
Recoveries | 278 |  | — |  | — |  | — |  | — |  | — |  | — |  | 278 |
Charge-offs | (392 | ) | — |  | — |  | — |  | — |  | — |  | (4 | ) | (396 | )
| Allowance for loan losses, end of period | $ | 2,783 |  | $ | 3,492 |  | $ | 1,030 |  | $ | 47 |  | $ | 3 |  | $ | 24 |  | $ | 6 |  | $ | 7,385 |
Allowance: |  |  |  |  |  |  |  |
Individually evaluated for impairment | $ | 151 |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | 6 |  | $ | — |  | $ | 157 |
Collectively evaluated for impairment | 2,632 |  | 3,492 |  | 1,030 |  | 47 |  | 3 |  | 18 |  | 6 |  | 7,228 |
| Allowance for loan losses, end of period | $ | 2,783 |  | $ | 3,492 |  | $ | 1,030 |  | $ | 47 |  | $ | 3 |  | $ | 24 |  | $ | 6 |  | $ | 7,385 |
Gross Loans: |  |  |  |  |  |  |  |
Individually evaluated for impairment | $ | 7,072 |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | 70 |  | $ | — |  | $ | 7,142 |
Collectively evaluated for impairment | 307,736 |  | 476,008 |  | 109,726 |  | 3,174 |  | 167 |  | 430 |  | 109 |  | 897,350 |
| Total loans held for investment, gross | $ | 314,808 |  | $ | 476,008 |  | $ | 109,726 |  | $ | 3,174 |  | $ | 167 |  | $ | 500 |  | $ | 109 |  | $ | 904,492 |
Allowance for loan losses as a percentage of gross loans held for investment | 0.88 | % | 0.73 | % | 0.94 | % | 1.48 | % | 1.80 | % | 4.80 | % | 5.50 | % | 0.81 | %
The following summarizes the components of the net change in the allowance for loan losses for the periods indicated:
| Year Ended June 30,
(In Thousands) | 2019 |  |  | 2018 |
Balance, beginning of year | $ | 7,385 |  |  |  | $ | 8,039 |  |
Recovery from the allowance for loan losses | (475 | ) |  |  | (536 | ) |
Recoveries | 200 |  |  |  | 278 |  |
Charge-offs | (34 | ) |  |  | (396 | ) |
Balance, end of year | $ | 7,076 |  |  |  | $ | 7,385 |  |
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, 2019
|  |  | 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 | $ | 2,640 |  | $ | — |  | $ | 2,640 |  | $ | (434 | ) | $ | 2,206 |  | $ | 1,583 |  | $ | 110 |
|  | Without a related allowance(2) | 3,518 |  | (518 | ) | 3,000 |  | — |  | 3,000 |  | 4,301 |  | 293 |
| Total single-family | 6,158 |  | (518 | ) | 5,640 |  | (434 | ) | 5,206 |  | 5,884 |  | 403 |
| Construction: |  |  |  |  |  |  |
|  | Without a related allowance(2) | 971 |  | — |  | 971 |  | — |  | 971 |  | 664 |  | — |
| Total commercial real estate | 971 |  | — |  | 971 |  | — |  | 971 |  | 664 |  | — |
Commercial business loans: |  |  |  |  |  |  |
| With a related allowance | 49 |  | — |  | 49 |  | (8 | ) | 41 |  | 58 |  | 5 |
| Total commercial business loans | 49 |  | — |  | 49 |  | (8 | ) | 41 |  | 58 |  | 5 |
Total non-performing loans | $ | 7,178 |  | $ | (518 | ) | $ | 6,660 |  | $ | (442 | ) | $ | 6,218 |  | $ | 6,606 |  | $ | 408 |
(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, 2018
|  |  | 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 | $ | 1,333 |  | $ | — |  | $ | 1,333 |  | $ | (185 | ) | $ | 1,148 |  | $ | 871 |  | $ | 51 |
|  | Without a related allowance(2) | 5,569 |  | (724 | ) | 4,845 |  | — |  | 4,845 |  | 6,767 |  | 203 |
| Total single-family | 6,902 |  | (724 | ) | 6,178 |  | (185 | ) | 5,993 |  | 7,638 |  | 254 |
| Commercial real estate: |  |  |  |  |  |  |
|  | Without a related allowance(2) | — |  | — |  | — |  | — |  | — |  | 17 |  | 13 |
| Total commercial real estate | — |  | — |  | — |  | — |  | — |  | 17 |  | 13 |
Commercial business loans: |  |  |  |  |  |  |
| With a related allowance | 70 |  | — |  | 70 |  | (6 | ) | 64 |  | 75 |  | 5 |
| Total commercial business loans | 70 |  | — |  | 70 |  | (6 | ) | 64 |  | 75 |  | 5 |
Total non-performing loans | $ | 6,972 |  | $ | (724 | ) | $ | 6,248 |  | $ | (191 | ) | $ | 6,057 |  | $ | 7,730 |  | $ | 272 |
(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, 2019 and 2018, there were no commitments to lend additional funds to those borrowers whose loans were classified as non-performing, except for one construction loan with undisbursed loan funds of $1.0 million at June 30, 2019. During the fiscal years ended June 30, 2019 and 2018, the Corporation’s average investment in non-performing loans was $6.6 million and $7.7 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 year ended June 30, 2019, the Bank received $574,000 in interest payments from non-performing loans and $408,000 was recognized as interest income. The remaining $166,000 was applied to reduce the loan balances under the cost recovery method. In comparison, for the fiscal year ended June 30, 2018, the Bank received $564,000 in interest payments from non-performing loans and $272,000 was recognized as interest income. The remaining $292,000 was applied to reduce the loan balances under the cost recovery method. The following tables denote the past due status of the Corporation's loans held for investment, gross, at the dates indicated.
|  | June 30, 2019
(In Thousands) | Current | 30-89 Days Past Due | Non-Accrual(1) | Total Loans Held for Investment, Gross
Mortgage loans: |  |  |  |
| Single-family | $ | 318,671 |  | $ | 660 |  | $ | 5,621 |  | $ | 324,952 |
| Multi-family | 439,041 |  | — |  | — |  | 439,041 |
| Commercial real estate | 111,928 |  | — |  | — |  | 111,928 |
| Construction | 3,667 |  | — |  | 971 |  | 4,638 |
| Other | 167 |  | — |  | — |  | 167 |
Commercial business loans | 429 |  | — |  | 49 |  | 478 |
Consumer loans | 129 |  | 5 |  | — |  | 134 |
| Total loans held for investment, gross | $ | 874,032 |  | $ | 665 |  | $ | 6,641 |  | $ | 881,338 |
(1) All loans 90 days or greater past due are placed on non-accrual status.
|  | June 30, 2018
(In Thousands) | Current | 30-89 Days Past Due | Non-Accrual(1) | Total Loans Held for Investment, Gross
Mortgage loans: |  |  |  |
| Single-family | $ | 307,863 |  | $ | 804 |  | $ | 6,141 |  | $ | 314,808 |
| Multi-family | 476,008 |  | — |  | — |  | 476,008 |
| Commercial real estate | 109,726 |  | — |  | — |  | 109,726 |
| Construction | 3,174 |  | — |  | — |  | 3,174 |
| Other | 167 |  | — |  | — |  | 167 |
Commercial business loans | 430 |  | — |  | 70 |  | 500 |
Consumer loans | 108 |  | 1 |  | — |  | 109 |
| Total loans held for investment, gross | $ | 897,476 |  | $ | 805 |  | $ | 6,211 |  | $ | 904,492 |
(1) All loans 90 days or greater past due are placed on non-accrual status. For the fiscal year ended June 30, 2019, there were no loans that were newly modified from their original terms, re-underwritten or identified as a restructured loan; one loan (previously modified) was downgraded; three loans were upgraded to the pass category; one loan was paid off; and no loans were converted to real estate owned. For the fiscal year ended June 30, 2018, there were two loans that were newly modified from their original terms, re-underwritten or identified as a restructured loan; two loans (previously modified) were downgraded; while two loans were upgraded to the pass category; and one loan was converted to a real estate owned. During the fiscal years ended June 30, 2019 and 2018, no restructured loans were in default within a 12-month period subsequent to their original restructuring. Additionally, during the fiscal year ended June 30, 2019, there was one restructured loan of $56,000 that was extended beyond the initial maturity of the modification; while in fiscal 2018, there were no restructured loans that were extended beyond the initial maturity of the modification. As of June 30, 2019, the net outstanding balance of the Corporation’s eight restructured loans was $3.8 million: one was classified as special mention and remains on accrual status ($437,000); one was classified as substandard on accrual status ($1.4 million); and six were classified as substandard on non-accrual status ($1.9 million). As of June 30, 2019, $2.4 million, or 63 percent, of the restructured loans were current with respect to their payment status. As of June 30, 2018, the net outstanding balance of the Corporation’s 11 restructured loans was $5.2 million: one loan was classified as special mention on accrual status ($389,000); one was classified as substandard on accrual status ($1.4 million); and nine loans were classified as substandard ($3.4 million, all on non-accrual status). As of June 30, 2018, $2.9 million, or 56 percent, of the restructured loans had a current payment status, consistent with modified their terms. At both June 30, 2019 and June 30, 2018, there were no commitments to lend additional funds to those borrowers whose loans were restructured. 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, 2019 and 2018 :
| At June 30,
(In Thousands) | 2019 | 2018
Restructured loans on non-accrual status: |  |
Mortgage loans: |  |
Single-family | $ | 1,891 |  | $ | 3,328 |
Commercial business loans | 41 |  | 64 |
Total | 1,932 |  | 3,392 |
Restructured loans on accrual status: |  |
Mortgage loans: |  |
Single-family | 1,861 |  | 1,788 |
Total | 1,861 |  | 1,788 |
Total restructured loans | $ | 3,793 |  | $ | 5,180 |
The following tables show the restructured loans by type, net of allowance for loan losses or charge-offs, at June 30, 2019 and 2018:
|  |  | At June 30, 2019
|  |  | Unpaid |  |  |  | Net
|  |  | Principal | Related | Recorded |  | Recorded
(In Thousands) | Balance | Charge-offs | Investment | Allowance(1) | Investment
Mortgage loans: |  |  |  |  |
| Single-family: |  |  |  |  |
|  | With a related allowance | $ | 2,199 |  | $ | — |  | $ | 2,199 |  | $ | (122 | ) | $ | 2,077 |
|  | Without a related allowance(2) | 2,040 |  | (365 | ) | 1,675 |  | — |  | 1,675 |
| Total single-family | 4,239 |  | (365 | ) | 3,874 |  | (122 | ) | 3,752 |
Commercial business loans: |  |  |  |  |
| With a related allowance | 49 |  | — |  | 49 |  | (8 | ) | 41 |
Total commercial business loans | 49 |  | — |  | 49 |  | (8 | ) | 41 |
Total restructured loans | $ | 4,288 |  | $ | (365 | ) | $ | 3,923 |  | $ | (130 | ) | $ | 3,793 |
(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, 2018
|  |  | Unpaid |  |  |  | Net
|  |  | Principal | Related | Recorded |  | Recorded
(In Thousands) | Balance | Charge-offs | Investment | Allowance(1) | Investment
Mortgage loans: |  |  |  |  |
| Single-family: |  |  |  |  |
|  | With a related allowance | $ | 2,228 |  | $ | — |  | $ | 2,228 |  | $ | (151 | ) | $ | 2,077 |
|  | Without a related allowance(2) | 3,450 |  | (411 | ) | 3,039 |  | — |  | 3,039 |
| Total single-family | 5,678 |  | (411 | ) | 5,267 |  | (151 | ) | 5,116 |
Commercial business loans: |  |  |  |  |
| With a related allowance | 70 |  | — |  | 70 |  | (6 | ) | 64 |
Total commercial business loans | 70 |  | — |  | 70 |  | (6 | ) | 64 |
Total restructured loans | $ | 5,748 |  | $ | (411 | ) | $ | 5,337 |  | $ | (157 | ) | $ | 5,180 |
(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:
| Year Ended June 30,
(In Thousands) | 2019 |  | 2018
Balance, beginning of year | $ | 677 |  |  | $ | 578 |
Originations | — |  |  | 2,415 |
Sales and payments | (675 | ) |  | (2,316 | )
Balance, end of year | $ | 2 |  |  | $ | 677 |
As of June 30, 2019 and 2018, all of the related-party loans were performing in accordance with their original contractual terms.

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- Definition The entire disclosure for financing receivables. Examples of financing receivables include, but are not limited to, loans, trade accounts receivables, notes receivable, credit cards, and receivables relating to a lessor's right(s) to payment(s) from a lease other than an operating lease that is recognized as assets. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 310 -URI http://asc.fasb.org/topic&trid=2196771 + Details
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- References No definition available. + Details
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