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Loans and Allowance for Credit Losses (Tables)

6 Months Ended

Dec. 31, 2023

Categories of Loans

Classes of loans include:

		December 31, 2023				June 30, 2023
Real estate loans:
One- to four-family, including home equity loans		$	175,817			$	163,854
Multi-family			128,625				89,649
Commercial			215,565				193,707
Home equity lines of credit			9,494				8,066
Construction			39,906				50,973
Commercial			83,698				79,693
Consumer			8,042				8,382
Total loans			661,147				594,324
Less:
Unearned fees and discounts, net			(337	)			(272	)
Allowance for credit losses			7,935				7,139
Loans, net		$	653,549			$	587,457

Allowance for Credit Losses

Allowance for Credit Losses

The following tables present the activity in the allowance for credit losses for the three-month and six-month periods ended December 31, 2023 and 2022 and the year ended June 30, 2023:

		Three Months Ended December 31, 2023 Real Estate Loans
		One- to Four-Family				Multi-Family				Commercial				Home Equity Lines of Credit
Allowance for credit losses:
Balance, beginning of period		$	1,906			$	1,115			$	2,265			$	134
Provision charged to expense			(97	)			750				328				13
Losses charged off			—				—				—				—
Recoveries			—				—				—				—
Balance, end of period		$	1,809			$	1,865			$	2,593			$	147
Loans:
Ending balance		$	175,817			$	128,625			$	215,565			$	9,494

		Three Months Ended December 31, 2023 (Continued)
		Construction				Commercial				Consumer				Total
Allowance for credit losses:
Balance, beginning of period		$	1,165			$	788			$	77			$	7,450
Provision charged to expense			(626	)			66				3				437
Losses charged off			—				—				(18	)			(18	)
Recoveries			—				61				5				66
Balance, end of period		$	539			$	915			$	67			$	7,935
Loans:
Ending balance		$	39,906			$	83,698			$	8,042			$	661,147

		Six Months Ended December 31, 2023 Real Estate Loans
		One- to Four-Family				Multi-Family				Commercial				Home Equity Lines of Credit
Allowance for credit losses:
Balance, beginning of period		$	1,898			$	1,121			$	2,369			$	121
Provision charged to expense			(89	)			744				224				26
Losses charged off			—				—				—				—
Recoveries			—				—				—				—
Balance, end of period		$	1,809			$	1,865			$	2,593			$	147
Loans:
Ending balance		$	175,817			$	128,625			$	215,565			$	9,494

		Six Months Ended December 31, 2023 (Continued)
		Construction				Commercial				Consumer				Total
Allowance for credit losses:
Balance, beginning of period		$	765			$	794			$	71			$	7,139
Provision charged to expense			(226	)			54				14				747
Losses charged off			—				—				(25	)			(25	)
Recoveries			—				67				7				74
Balance, end of period		$	539			$	915			$	67			$	7,935
Loans:
Ending balance		$	39,906			$	83,698			$	8,042			$	661,147

		Year Ended June 30, 2023 Real Estate Loans
		One- to Four-Family				Multi-Family				Commercial				Home Equity Lines of Credit
Allowance for credit losses:
Balance, beginning of year (prior to adoption of ASU 2016-13)		$	1,028			$	1,375			$	1,985			$	70
Impact of adopting ASU 2016-13			382				(140	)			385				33
Provision charged to expense			487				(114	)			(1	)			18
Losses charged off			—				—				—				—
Recoveries			1				—				—				—
Balance, end of year		$	1,898			$	1,121			$	2,369			$	121
Loans:
Ending balance		$	163,854			$	89,649			$	193,707			$	8,066

		Year Ended June 30, 2023 (Continued)
		Construction				Commercial				Consumer				Total
Allowance for credit losses:
Balance, beginning of year (prior to adoption of ASU 2016-13)		$	489			$	2,025			$	80			$	7,052
Impact of adopting ASU 2016-13			192				(818	)			13				47
Provision charged to expense			84				(422	)			—				52
Losses charged off			—				(14	)			(37	)			(51	)
Recoveries			—				23				15				39
Balance, end of year		$	765			$	794			$	71			$	7,139
Loans:
Ending balance		$	50,973			$	79,693			$	8,382			$	594,324

		Three Months Ended December 31, 2022 Real Estate Loans
		One- to Four-Family				Multi-Family				Commercial				Home Equity Lines of Credit
Allowance for credit losses:
Balance, beginning of period		$	1,537			$	1,284			$	2,386			$	94
Provision charged to expense			185				118				6				7
Losses charged off			—				—				—				—
Recoveries			—				—				—				—
Balance, end of period		$	1,722			$	1,402			$	2,392			$	101
Loans:
Ending balance		$	150,711			$	100,147			$	192,015			$	6,926

		Three Months Ended December 31, 2022 (Continued)
		Construction				Commercial				Consumer				Total
Allowance for credit losses:
Balance, beginning of period		$	549			$	1,090			$	83			$	7,023
Provision charged to expense			36				(227	)			17				142
Losses charged off			—				—				(9	)			(9	)
Recoveries			—				8				2				10
Balance, end of period		$	585			$	871			$	93			$	7,166
Loans:
Ending balance		$	36,595			$	72,360			$	9,486			$	568,240

		Six Months Ended December 31, 2022 Real Estate Loans
		One- to Four-Family				Multi-Family				Commercial				Home Equity Lines of Credit
Allowance for credit losses:
Balance, beginning of period (prior to adoption of ASU 2016-13)		$	1,028			$	1,375			$	1,985			$	70
Impact of adopting ASU 2016-13			382				(140	)			385				33
Provision charged to expense			311				167				22				(2	)
Losses charged off			—				—				—				—
Recoveries			1				—				—				—
Balance, end of period		$	1,722			$	1,402			$	2,392			$	101
Loans:
Ending balance		$	150,711			$	100,147			$	192,015			$	6,926

		Six Months Ended December 31, 2022 (Continued)
		Construction				Commercial				Consumer				Total
Allowance for credit losses:
Balance, beginning of period (prior to adoption of ASU 2016-13)		$	489			$	2,025			$	80			$	7,052
Impact of adopting ASU 2016-13			192				(818	)			13				47
Provision charged to expense			(96	)			(344	)			17				75
Losses charged off			—				(4	)			(21	)			(25	)
Recoveries			—				12				4				17
Balance, end of period		$	585			$	871			$	93			$	7,166
Loans:
Ending balance		$	36,595			$	72,360			$	9,486			$	568,240

Credit Risk Profile of Association's Loan Portfolio Based on Risk Rating Category and Calendar Year of Origination

The following tables present the credit risk profile of the Company’s loan portfolio based on risk rating category and calendar year of origination as of December 31, 2023 and June 30, 2023 (in thousands):

December 31, 2023
Risk Rating		2023				2022				2021				2020				2019				Prior Years				Total
One- to Four-Family
Pass		$	44,051			$	53,679			$	26,209			$	16,009			$	5,381			$	30,209			$	175,538
Watch			—				—				80				—				—				—				80
Substandard			14				6				5				—				174				—				199
Total		$	44,065			$	53,685			$	26,294			$	16,009			$	5,555			$	30,209			$	175,817
Multi-Family
Pass		$	11,720			$	48,742			$	20,279			$	23,065			$	8,308			$	16,272			$	128,386
Watch			—				—				—				—				—				—				—
Substandard			—				—				—				—				239				—				239
Total		$	11,720			$	48,742			$	20,279			$	23,065			$	8,547			$	16,272			$	128,625
Commercial Real Estate
Pass		$	30,022			$	72,434			$	28,336			$	31,285			$	5,498			$	47,070			$	214,645
Watch			—				—				—				—				—				—				—
Substandard			—				—				—				840				80				—				920
Total		$	30,022			$	72,434			$	28,336			$	32,125			$	5,578			$	47,070			$	215,565
Home Equity Line of Credit
Pass		$	3,041			$	1,960			$	1,455			$	1,002			$	749			$	1,287			$	9,494
Watch			—				—				—				—				—				—				—
Substandard			—				—				—				—				—				—				—
Total		$	3,041			$	1,960			$	1,455			$	1,002			$	749			$	1,287			$	9,494
Construction
Pass		$	32,990			$	6,916			$	—			$	—			$	—			$	—			$	39,906
Watch			—				—				—				—				—				—				—
Substandard			—				—				—				—				—				—				—
Total		$	32,990			$	6,916			$	—			$	—			$	—			$	—			$	39,906
Commercial Business
Pass		$	29,889			$	18,008			$	11,578			$	8,070			$	6,356			$	8,007			$	81,908
Watch			—				—				—				—				—				—				—
Substandard			—				38				219				1,476				56				1				1,790
Total		$	29,889			$	18,046			$	11,797			$	9,546			$	6,412			$	8,008			$	83,698
Consumer
Pass		$	3,703			$	2,433			$	1,166			$	574			$	110			$	56			$	8,042
Watch			—				—				—				—				—				—				—
Substandard			—				—				—				—				—				—				—
Total		$	3,703			$	2,433			$	1,166			$	574			$	110			$	56			$	8,042
Total Loans
Pass		$	155,416			$	204,172			$	89,023			$	80,005			$	26,402			$	102,901			$	657,919
Watch			—				—				80				—				—				—				80
Substandard			14				44				224				2,316				549				1				3,148
Total		$	155,430			$	204,216			$	89,327			$	82,321			$	26,951			$	102,902			$	661,147

June 30, 2023
Risk Rating		2023				2022				2021				2020				2019				Prior Years				Total
One- to Four-Family
Pass		$	22,032			$	56,054			$	27,843			$	18,468			$	5,996			$	32,729			$	163,122
Watch			—				—				—				—				—				335				335
Substandard			14				6				94				61				222				—				397
Total		$	22,046			$	56,060			$	27,937			$	18,529			$	6,218			$	33,064			$	163,854
Multi-Family
Pass		$	674			$	37,826			$	10,647			$	14,399			$	8,587			$	17,272			$	89,405
Watch			—				—				—				—				—				—				—
Substandard			—				—				—				—				244				—				244
Total		$	674			$	37,826			$	10,647			$	14,399			$	8,831			$	17,272			$	89,649
Commercial Real Estate
Pass		$	12,214			$	63,645			$	29,320			$	32,502			$	5,844			$	49,239			$	192,764
Watch			—				—				—				—				—				—				—
Substandard			—				—				—				862				81				—				943
Total		$	12,214			$	63,645			$	29,320			$	33,364			$	5,925			$	49,239			$	193,707
Home Equity Line of Credit
Pass		$	982			$	2,554			$	1,301			$	1,035			$	789			$	1,405			$	8,066
Watch			—				—				—				—				—				—				—
Substandard			—				—				—				—				—				—				—
Total		$	982			$	2,554			$	1,301			$	1,035			$	789			$	1,405			$	8,066
Construction
Pass		$	2,882			$	29,188			$	10,432			$	8,471			$	—			$	—			$	50,973
Watch			—				—				—				—				—				—				—
Substandard			—				—				—				—				—				—				—
Total		$	2,882			$	29,188			$	10,432			$	8,471			$	—			$	—			$	50,973
Commercial Business
Pass		$	12,449			$	20,004			$	17,673			$	8,797			$	7,669			$	8,841			$	75,433
Watch			—				—				—				—				—				—				—
Substandard			2,779				59				174				1,189				57				2				4,260
Total		$	15,228			$	20,063			$	17,847			$	9,986			$	7,726			$	8,843			$	79,693
Consumer
Pass		$	2,391			$	3,181			$	1,653			$	834			$	211			$	107			$	8,377
Watch			—				—				—				—				—				—				—
Substandard			—				—				1				—				—				4				5
Total		$	2,391			$	3,181			$	1,654			$	834			$	211			$	111			$	8,382
Total Loans
Pass		$	53,624			$	212,452			$	98,869			$	84,506			$	29,096			$	109,593			$	588,140
Watch			—				—				—				—				—				335				335
Substandard			2,793				65				269				2,112				604				6				5,849
Total		$	56,417			$	212,517			$	99,138			$	86,618			$	29,700			$	109,934			$	594,324

Association's Loan Portfolio Aging Analysis

The following tables present the Company’s loan portfolio aging analysis:

		30-59 Days Past Due				60-89 Days Past Due				90 Days or Greater				Total Past Due				Current				Total Loans Receivable				Total Loans 90 Days Past Due & Accruing
December 31, 2023:
Real estate loans:
One- to four-family		$	1,263			$	62			$	1			$	1,326			$	174,491			$	175,817			$	1
Multi-family			122				—				—				122				128,503				128,625				—
Commercial			393				152				—				545				215,020				215,565				—
Home equity lines of credit			—				19				—				19				9,475				9,494				—
Construction			—				—				—				—				39,906				39,906				—
Commercial			19				25				29				73				83,625				83,698				—
Consumer			2				24				—				26				8,016				8,042				—
Total		$	1,799			$	282			$	30			$	2,111			$	659,036			$	661,147			$	1

		30-59 Days Past Due				60-89 Days Past Due				90 Days or Greater				Total Past Due				Current				Total Loans Receivable				Total Loans 90 Days Past Due & Accruing
June 30, 2023:
Real estate loans:
One- to four-family		$	523			$	116			$	—			$	639			$	163,215			$	163,854			$	—
Multi-family			—				—				—				—				89,649				89,649				—
Commercial			153				—				—				153				193,554				193,707				—
Home equity lines of credit			—				20				—				20				8,046				8,066				—
Construction			—				—				—				—				50,973				50,973				—
Commercial			56				—				58				114				79,579				79,693				—
Consumer			47				6				2				55				8,327				8,382				—
Total		$	779			$	142			$	60			$	981			$	593,343			$	594,324			$	—

Nonaccrual with no Allowance for Credit Losses and Nonaccrual Loans

The following table presents the amortized cost basis of loans on nonaccrual status and of nonaccrual loans individually evaluated for which no allowance was recorded at December 31, 2023 and June 30, 2023:

		December 31, 2023								June 30, 2023
		Nonaccrual with no Allowance for Credit Losses				Nonaccrual				Nonaccrual with no Allowance for Credit Losses				Nonaccrual
Mortgages on real estate:
One- to four-family		$	—			$	—			$	—			$	—
Multi-family			—				—				—				—
Commercial			—				—				—				—
Home equity lines of credit			—				—				—				—
Construction loans			—				—				—				—
Commercial business loans			—				29				—				115
Consumer loans			—				—				—				2
Total		$	—			$	29			$	—			$	117

Loans Modified as Troubled Debt Restructurings

The following table presents the recorded balance, at original cost, of troubled debt restructurings, as of June 30, 2023. All TDRs were performing according to the terms of the restructuring and were accruing as of June 30, 2023.

		June 30, 2023
Real estate loans
One- to four-family		$	189
Multi-family			—
Commercial			—
Home equity lines of credit			—
Total real estate loans			189
Construction loans			—
Commercial business loans			26
Consumer loans			—
Total		$	215

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+ References

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