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Disclosures About Fair Value of Assets and Liabilities
 3 Months Ended
Sep. 30, 2023
Disclosures About Fair Value of Assets and Liabilities [Abstract]  
Disclosures About Fair Value of Assets and Liabilities

Note 5. Disclosures About Fair Value of Assets and Liabilities

 

ASC topic 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants (exit price) at the measurement date. ASC topic 820 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes six levels of inputs that may be used to measure fair value:

 

Level 1 – Quoted prices in active markets for identical assets or liabilities.

 

Level 2 – Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in active markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

 

Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

 

Following is a description of the valuation methodologies used for instruments measured at fair value, as well as the general classification of such instruments pursuant to the valuation hierarchy.

 

Securities

 

Where quoted market prices are available in an active market, securities are classified within Level 1 of the valuation hierarchy. If quoted market prices are not available, then fair values are estimated by using pricing models, quoted prices of securities with similar characteristics. Level 2 securities include agency mortgage-backed securities and agency bonds.

 

Financial assets measured at fair value on a recurring basis are summarized below:

 

   Fair Value Measurements Using 
(in thousands)  Fair Value   Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1)		   Significant
Other
Observable
Inputs
(Level 2)		   Significant
Unobservable
Inputs
(Level 3)		 
September 30, 2023                
Agency mortgage-backed: residential  $11,230   $
           –
   $11,230   $
           –
 
                     
June 30, 2023                    
Agency mortgage-backed: residential  $12,080   $
–
   $12,080   $
–
 

 

There were no assets or liabilities which were measured at fair value on a nonrecurring basis at September 30, 2023, and June 30, 2023.

 

The following is a disclosure of the fair value of financial instruments, both assets and liabilities, whether or not recognized in the consolidated balance sheet, for which it is practicable to estimate that value. For financial instruments where quoted market prices are not available, fair values are based on estimates using present value and other valuation methods.

 

The methods used are greatly affected by the assumptions applied, including the discount rate and estimates of future cash flows. Therefore, the fair values presented may not represent amounts that could be realized in an exchange for certain financial instruments.

 

Based on the foregoing methods and assumptions, the carrying value and fair value of the Company’s financial instruments at September 30, 2023 and June 30, 2023 are as follows:

 

       Fair Value Measurements at 
   Carrying   September 30, 2023 Using 
(in thousands)  Value   Level 1   Level 2   Level 3   Total 
Financial assets                    
Cash and cash equivalents  $12,586   $12,586    
 
    
 
   $12,586 
Available-for-sale securities   11,230    
 
   $11,230    
 
    11,230 
Held-to-maturity securities   256    
 
    241    
 
    241 
Loans held for sale   280              280    280 
Loans receivable – net   318,187    
 
    
 
   $295,267    295,267 
Federal Home Loan Bank stock   4,031    
 
    
 
    
 
    n/a 
Accrued interest receivable   1,003    
 
    1,003    
 
    1,003 
                          
Financial liabilities                         
Deposits  $252,359   $85,846   $165,351    
 
    251,197 
Federal Home Loan Bank advances   52,576    
 
    52,540    
 
    52,540 
Advances by borrowers for taxes and insurance   1,123    
 
    1,123    
 
    1,123 
Accrued interest payable   164    
 
    164    
 
    164 

 

       Fair Value Measurements at 
   Carrying   June 30, 2023 Using 
(in thousands)  Value   Level 1   Level 2   Level 3   Total 
Financial assets                    
Cash and cash equivalents  $8,167   $8,167    
 
    
 
   $8,167 
Available-for-sale securities   12,080        $12,080         12,080 
Held-to-maturity securities   274    
 
    259    
 
    259 
Loans receivable - net   313,807    
 
    
 
   $293,530    293,530 
Federal Home Loan Bank stock   4,623    
 
    
 
    
 
    n/a 
Accrued interest receivable   902    
 
    902    
 
    902 
                          
Financial liabilities                         
Deposits  $226,309   $88,994   $136,577        $225,571 
Federal Home Loan Bank advances   70,087    
 
    69,863    
 
    69,863 
Advances by borrowers for taxes and insurance   793    
 
    793    
 
    793 
Accrued interest payable   70    
 
    70    
 
    70