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Fair Value of Financial Instruments (Tables)

9 Months Ended

Mar. 31, 2019

Fair Value Disclosures [Abstract]

Schedule of aggregate fair value and aggregate unpaid principal balance of loans held for sale

(In Thousands)		Aggregate Fair Value				Aggregate Unpaid Principal Balance				Net Unrealized Gain (Loss)
As of March 31, 2019:
Loans held for investment, at fair value		$	5,239			$	5,417			$	(178	)
Loans held for sale, at fair value		$	30,500			$	29,565			$	935
As of June 30, 2018:
Loans held for investment, at fair value		$	5,234			$	5,546			$	(312	)
Loans held for sale, at fair value		$	96,298			$	93,791			$	2,507

Schedule of fair value, assets and liabilities measured on recurring basis

		Fair Value Measurement at March 31, 2019 Using:
(In Thousands)		Level 1				Level 2				Level 3				Total
Assets:
Investment securities - available for sale:
U.S. government agency MBS		$	—			$	3,796			$	—			$	3,796
U.S. government sponsored enterprise MBS			—				2,198				—				2,198
Private issue CMO			—				—				300				300
Investment securities - available for sale			—				5,994				300				6,294
Loans held for investment, at fair value			—				—				5,239				5,239
Loans held for sale, at fair value			—				30,500				—				30,500
Interest-only strips			—				—				18				18
Derivative assets:
Commitments to extend credit on loans to be held for sale			—				—				240				240
Derivative assets			—				—				240				240
Total assets		$	—			$	36,494			$	5,797			$	42,291
Liabilities:
Derivative liabilities:
Mandatory loan sale commitments		$	—			$	—			$	7			$	7
TBA MBS trades			—				217				—				217
Derivative liabilities			—				217				7				224
Total liabilities		$	—			$	217			$	7			$	224

		Fair Value Measurement at June 30, 2018 Using:
(In Thousands)		Level 1				Level 2				Level 3				Total
Assets:
Investment securities - available for sale:
U.S. government agency MBS		$	—			$	4,384			$	—			$	4,384
U.S. government sponsored enterprise MBS			—				2,762				—				2,762
Private issue CMO			—				—				350				350
Investment securities - available for sale			—				7,146				350				7,496
Loans held for investment, at fair value			—				—				5,234				5,234
Loans held for sale, at fair value			—				96,298				—				96,298
Interest-only strips			—				—				23				23
Derivative assets:
Commitments to extend credit on loans to be held for sale			—				—				849				849
Derivative assets			—				—				849				849
Total assets		$	—			$	103,444			$	6,456			$	109,900
Liabilities:
Derivative liabilities:
Commitments to extend credit on loans to be held for sale		$	—			$	—			$	24			$	24
Mandatory loan sale commitments			—				—				32				32
TBA MBS trades			—				408				—				408
Derivative liabilities			—				408				56				464
Total liabilities		$	—			$	408			$	56			$	464

Schedule for reconciliation of recurring fair value measurements using level 3 inputs

		For the Quarter Ended March 31, 2019
		Fair Value Measurement Using Significant Other Unobservable Inputs (Level 3)
(In Thousands)		Private Issue CMO				Loans Held  For  Investment, at  fair value (1)				Interest- Only Strips				Loan Commitments  to Originate (2)				Mandatory Commitments (3)				Total
Beginning balance at December 31, 2018		$	310			$	4,995			$	21			$	504			$	(9	)		$	5,821
Total gains or losses (realized/unrealized):
Included in earnings			—				87				—				(264	)			(3	)			(180	)
Included in other comprehensive loss			1				—				(3	)			—				—				(2	)
Purchases			—				—				—				—				—				—
Issuances			—				—				—				—				—				—
Settlements			(11	)			(34	)			—				—				5				(40	)
Transfers in and/or out of Level 3			—				191				—				—				—				191
Ending balance at March 31, 2019		$	300			$	5,239			$	18			$	240			$	(7	)		$	5,790

⁽¹⁾ The valuation of loans held for investment at fair value includes the management estimates of the specific credit risk attributes of each loan, in addition to the quoted secondary-market prices which account for the interest rate characteristics of each loan.

⁽²⁾ Consists of commitments to extend credit on loans to be held for sale.

⁽³⁾ Consists of mandatory loan sale commitments.

		For the Quarter Ended March 31, 2018
		Fair Value Measurement Using Significant Other Unobservable Inputs (Level 3)
(In Thousands)		Private Issue CMO				Loans Held  For  Investment, at  fair value (1)				Interest- Only Strips				Loan Commit- ments to Originate  (2)				Manda- tory Commit- ments  (3)				Total
Beginning balance at December 31, 2017		$	419			$	5,157			$	26			$	716			$	(24	)		$	6,294
Total gains or losses (realized/unrealized):
Included in earnings			—				(118	)			—				266				(26	)			122
Included in other comprehensive loss			(2	)			—				(2	)			—				—				(4	)
Purchases			—				—				—				—				—				—
Issuances			—				—				—				—				—				—
Settlements			(22	)			(43	)			—				—				—				(65	)
Transfers in and/or out of Level 3			—				—				—				—				—				—
Ending balance at March 31, 2018		$	395			$	4,996			$	24			$	982			$	(50	)		$	6,347

⁽¹⁾ The valuation of loans held for investment at fair value includes the management estimates of the specific credit risk attributes of each loan, in addition to the quoted secondary-market prices which account for the interest rate characteristics of each loan.

⁽²⁾ Consists of commitments to extend credit on loans to be held for sale.

⁽³⁾ Consists of mandatory loan sale commitments.

		For the Nine Months Ended March 31, 2019
		Fair Value Measurement Using Significant Other Unobservable Inputs (Level 3)
(In Thousands)		Private Issue CMO				Loans Held  For  Investment, at  fair value (1)				Interest- Only  Strips				Loan Commitments  to Originate (2)				Mandatory Commitments (3)				Total
Beginning balance at June 30, 2018		$	350			$	5,234			$	23			$	825			$	(32	)		$	6,400
Total gains or losses (realized/unrealized):
Included in earnings			—				133				—				(585	)			18				(434	)
Included in other comprehensive loss			—				—				(5	)			—				—				(5	)
Purchases			—				—				—				—				—				—
Issuances			—				—				—				—				—				—
Settlements			(50	)			(789	)			—				—				7				(832	)
Transfers in and/or out of Level 3			—				661				—				—				—				661
Ending balance at March 31, 2019		$	300			$	5,239			$	18			$	240			$	(7	)		$	5,790

⁽¹⁾ The valuation of loans held for investment at fair value includes the management estimates of the specific credit risk attributes of each loan, in addition to the quoted secondary-market prices which account for the interest rate characteristics of each loan.

⁽²⁾ Consists of commitments to extend credit on loans to be held for sale.

⁽³⁾ Consists of mandatory loan sale commitments.

		For the Nine Months Ended March 31, 2018
		Fair Value Measurement Using Significant Other Unobservable Inputs (Level 3)
(In Thousands)		Private Issue CMO				Loans Held  For  Investment, at  fair value (1)				Interest- Only Strips				Loan Commit- ments to Originate  (2)				Manda- tory Commit- ments (3)				Option Contracts				Total
Beginning balance at June 30, 2017		$	461			$	6,445			$	31			$	809			$	47			$	37			$	7,830
Total gains or losses (realized/unrealized):
Included in earnings			—				(72	)			—				173				(99	)			(37	)			(35	)
Included in other comprehensive loss			(1	)			—				(7	)			—				—				—				(8	)
Purchases			—				—				—				—				—				—				—
Issuances			—				—				—				—				—				—				—
Settlements			(65	)			(1,899	)			—				—				2				—				(1,962	)
Transfers in and/or out of Level 3			—				522				—				—				—				—				522
Ending balance at March 31, 2018		$	395			$	4,996			$	24			$	982			$	(50	)		$	—			$	6,347

⁽¹⁾ The valuation of loans held for investment at fair value includes the management estimates of the specific credit risk attributes of each loan, in addition to the quoted secondary-market prices which account for the interest rate characteristics of each loan.

⁽²⁾ Consists of commitments to extend credit on loans to be held for sale.

⁽³⁾ Consists of mandatory loan sale commitments.

Schedule of fair value assets measured on nonrecurring basis

		Fair Value Measurement at March 31, 2019 Using:
(In Thousands)		Level 1				Level 2				Level 3				Total
Non-performing loans		$	—			$	4,541			$	1,574			$	6,115
Mortgage servicing assets			—				—				456				456
Real estate owned, net			—				—				—				—
Total		$	—			$	4,541			$	2,030			$	6,571

		Fair Value Measurement at June 30, 2018 Using:
(In Thousands)		Level 1				Level 2				Level 3				Total
Non-performing loans		$	—			$	4,845			$	1,212			$	6,057
Mortgage servicing assets			—				—				135				135
Real estate owned, net			—				906				—				906
Total		$	—			$	5,751			$	1,347			$	7,098

Schedule of additional information about valuation techniques and inputs used for assets and liabilities

(Dollars In Thousands)

Fair Value As of  March 31,  2019

Valuation Techniques

Unobservable Inputs

Range (1) (Weighted Average)

Impact to Valuation from an Increase in Inputs (2)

Assets:

Securities available - for sale: Private issue CMO

$

300

Market comparable pricing

Comparability adjustment

1.2% – 1.3% (1.2%)

Increase

Loans held for investment,  at fair value

$

5,239

Relative value  analysis

Broker quotes   Credit risk factors

98.3% – 105.2%  (101.1%) of par  1.2% - 100.0% (4.3%)

Increase   Decrease

Non-performing loans

$

703

Discounted cash flow

Default rates

5.0%

Decrease

Non-performing loans

$

871

Relative value analysis

Loss severity

20.0% - 30.0% (21.3%)

Decrease

Mortgage servicing assets

$

456

Discounted cash flow

Prepayment speed (CPR)  Discount rate

9.7% - 60.0% (21.7%) 9.0% - 10.5% (9.2%)

Decrease Decrease

Interest-only strips

$

18

Discounted cash flow

Prepayment speed (CPR)  Discount rate

18.7% - 35.9% (34.3%) 9.0%

Decrease Decrease

Commitments to extend credit on loans to be held for sale

$

240

Relative value analysis

TBA-MBS broker quotes Fall-out ratio (3)

99.0% – 103.4%  (101.6%) of par  18.5% - 19.1% (18.6%)

Increase    Decrease

Liabilities:

Mandatory loan sale commitments

$

7

Relative value analysis

TBA MBS broker quotes Roll-forward costs (4)

102.3% - 105.7%  (103.9%) of par  0.015%

Increase    Increase

⁽¹⁾ The range is based on the estimated fair values and management estimates.

⁽²⁾ Unless otherwise noted, this column represents the directional change in the fair value of the Level 3 investments that would result from an increase to the corresponding unobservable input. A decrease to the unobservable input would have the opposite effect. Significant changes in these inputs in isolation could result in significantly higher or lower fair value measurements.

⁽³⁾ The percentage of commitments to extend credit on loans to be held for sale which management has estimated may not fund.

⁽⁴⁾ An estimated cost to roll forward the mandatory loan sale commitments which management has estimated may not be delivered to the corresponding investors in a timely manner.

Schedule of carrying amount and fair value of financial instruments

		March 31, 2019
(In Thousands)		Carrying Amount				Fair Value				Level 1				Level 2				Level 3
Financial assets:
Investment securities - held to maturity		$	102,510			$	103,056				—			$	103,056			$	—
Loans held for investment, not recorded at fair value		$	878,315			$	857,399				—				—			$	857,399
FHLB – San Francisco stock		$	8,199			$	8,199				—			$	8,199				—
Financial liabilities:
Deposits		$	876,884			$	847,875				—				—			$	847,875
Borrowings		$	101,121			$	101,274				—				—			$	101,274

		June 30, 2018
(In Thousands)		Carrying Amount				Fair Value				Level 1				Level 2				Level 3
Financial assets:
Investment securities - held to maturity		$	87,813			$	87,239				—			$	87,239				—
Loans held for investment, not recorded at fair value		$	897,451			$	873,112				—				—			$	873,112
FHLB – San Francisco stock		$	8,199			$	8,199				—			$	8,199				—
Financial liabilities:
Deposits		$	907,598			$	877,641				—				—			$	877,641
Borrowings		$	126,163			$	123,778				—				—			$	123,778

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Tabular disclosure of assets and liabilities, including [financial] instruments measured at fair value that are classified in stockholders' equity, if any, that are measured at fair value on a recurring basis. The disclosures contemplated herein include the fair value measurements at the reporting date by the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3).

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