Fair Value Measurements (Tables)

9 Months Ended

Jun. 30, 2013

Fair Value, Assets Measured on Recurring Basis

The following table summarizes the balances of assets and liabilities measured at estimated fair value on a recurring basis at June 30, 2013 (dollars in thousands):



	Estimated Fair Value
	Level 1		Level 2		Level 3		Total
Available for Sale Securities
MBS:
U.S. government agencies	$	—	$	2,423	$	—	$	2,423
Private label residential	—		986		—		986
Mutual funds	961		—		—		961
Total	$	961	$	3,409	$	—	$	4,370

There were no transfers among Level 1, Level 2 and Level 3 during the nine months ended June 30, 2013.

The following table summarizes the balances of assets and liabilities measured at estimated fair value on a recurring basis at September 30, 2012 (dollars in thousands):



	Estimated Fair Value
	Level 1		Level 2		Level 3		Total
Available for Sale Securities
MBS:
U.S. government agencies	$	—	$	2,975	$	—	$	2,975
Private label residential	—		957		—		957
Mutual funds	1,013		—		—		1,013
Total	$	1,013	$	3,932	$	—	$	4,945

Balances of Assets Measured at Estimated Fair Value, Nonrecurring Basis

The following table summarizes the balances of assets measured at estimated fair value on a non-recurring basis at June 30, 2013, and the total losses resulting from these estimated fair value adjustments for the nine months ended June 30, 2013 (dollars in thousands):



	Estimated Fair Value
	Level 1		Level 2		Level 3		Total Losses
Impaired loans:
Mortgage Loans;
One-to four-family	$	—	$	—	$	4,398	$	527
Multi-family	—		—		5,037		116
Commercial	—		—		6,398		667
Construction – speculative one- to- four-family	—		—		610		—
Land	—		—		1,049		2,250
Consumer loans:
Home equity and second mortgage	—		—		262		184
Total impaired loans (1)	—		—		17,754		3,744
MBS – held to maturity (2):
Private label residential	—		23		—		37
OREO and other repossessed items (3)	—		—		15,314		759
Total	$	—	$	23	$	33,068	$	4,540

_______________________


(1)	The loss represents charge-offs on collateral dependent loans for estimated fair value adjustment based on the estimated fair value of the collateral. Fair value is the recorded investment less the related allowance.


(2)	The loss represents OTTI credit-related charges on held to maturity MBS.


(3)	The loss represents the results of management’s periodic reviews of the recorded value to determine whether the property continues to be recorded at the lower of its recorded book value or estimated fair value, net of estimated costs to sell.

The following table summarizes the balances of assets and liabilities measured at estimated fair value on a non-recurring basis at September 30, 2012 and the total losses resulting from these estimated fair value adjustments for the year ended September 30, 2012 (dollars in thousands):



	Estimated Fair Value
	Level 1		Level 2		Level 3		Total Losses
Impaired loans:
Mortgage Loans;
One-to four-family	$	—	$	—	$	3,094	$	276
Multi-family	—		—		6,168		14
Commercial	—		—		8,929		1,215
Construction – custom and owner/builder	—		—		86		—
Construction – speculative one-to four-family	—		—		591		—
Land	—		—		1,938		1,251
Consumer loans:
Home equity and second mortgage	—		—		265		232
Total impaired loans (1)	—		—		21,071		2,988
MBS – held to maturity (2):
Private label residential	—		231		—		164
OREO and other repossessed items (3)	—		—		13,302		947
MSRs (4)	—		—		2,011		—
Total	$	—	$	231	$	36,384	$	4,099

_______________________


(1)	The loss represents charge-offs on collateral dependent loans for estimated fair value adjustment based on the estimated fair value of the collateral. Fair value is the recorded investment less the related allowance.


(2)	The loss represents OTTI credit-related charges on held-to-maturity MBS.


(3)	The loss represents the results of management’s periodic reviews of the recorded value to determine whether the property continues to be recorded at the lower of its recorded book value or estimated fair value, net of estimated costs to sell.


(4)	The amount of impairment recognized is the amount, if any, by which the amortized cost of the rights exceed their estimated fair value. Impairment, if deemed temporary, is recognized through a valuation allowance to the extent that estimated fair value is less than the recorded amount.

Level 3 Fair Value Measurements, Nonrecurring Basis

The following table presents quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis at the date indicated (dollars in thousands):



	June 30, 2013
	Fair Value		Valuation Technique(s)	Unobservable Input(s)	Range
Impaired loans	$	17,754	Market approach	Appraised value of underlying collateral less selling costs	NA

Other real estate owned	$	15,314	Market approach	Lower of appraised value or listing price less selling costs	NA

Balances of Assets and Liabilities Measured at Estimated Fair Value, Recurring Basis

The estimated fair values of financial instruments were as follows as of June 30, 2013 and September 30, 2012 (dollars in thousands):



	June 30, 2013
			Fair Value Measurements Using:
	Recorded Amount		Total		Level 1		Level 2		Level 3
Financial Assets
Cash and cash equivalents	$	82,545	$	82,545	$	82,545	$	—	$	—
CDs held for investment	26,749		26,749		26,749		—		—
MBS and other investments	7,262		8,009		961		7,048		—
FHLB stock	5,502		5,502		5,502		—		—
Loans receivable, net	542,855		499,540		—		—		499,540
Loans held for sale	2,433		2,523		2,523		—		—
Accrued interest receivable	2,015		2,015		2,015		—		—

Financial Liabilities
Deposits:
Non-interest-bearing demand	$	83,043	$	83,043	$	83,043	$	—	$	—
Interest-bearing	513,021		514,524		331,539		—		182,985
Total deposits	596,064		597,567		414,582		—		182,985
FHLB advances	45,000		48,583		—		48,583		—
Accrued interest payable	336		336		336		—		—



	September 30, 2012
			Fair Value Measurements Using:
	Recorded Amount		Total		Level 1		Level 2		Level 3
Financial Assets
Cash and cash equivalents	$	96,668	$	96,668	$	96,668	$	—	$	—
CDs held for investment	23,490		23,490		23,490		—		—
MBS and other investments	8,284		8,577		1,043		7,534		—
FHLB stock	5,655		5,655		5,655		—		—
Loans receivable, net	537,053		502,147		—		—		502,147
Loans held for sale	1,427		1,504		1,504		—		—
Accrued interest receivable	2,183		2,183		2,183		—		—

Financial Liabilities
Deposits:
Non-interest-bearing demand	$	75,296	$	75,296	$	75,296	$	—	$	—
Interest-bearing	522,630		524,823		317,181		—		207,642
Total deposits	597,926		600,119		392,477		—		207,642
FHLB advances	45,000		51,115		—		51,115		—
Repurchase agreements	855		855		855		—		—
Accrued interest payable	404		404		404		—		—

- Definition

Tabular disclosure of assets and liabilities by class, including financial instruments measured at fair value that are classified in shareholders' equity, if any, that are measured at fair value on a nonrecurring basis in periods after initial recognition (for example, impaired assets). Disclosures may include, but are not limited to: (a) the fair value measurements recorded and the reasons for the measurements and (b) the level within the fair value hierarchy in which the fair value measurements are categorized in their entirety (levels 1, 2, 3).

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- Definition

Tabular disclosure of assets, including [financial] instruments measured at fair value that are classified in stockholders' equity, if any, by class 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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