10-K/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K/A

AMENDMENT NO. 1

x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Fiscal Year Ended June 30, 2012

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from              to             

Commission File Number: 000-50970

PSB Holdings, Inc.

(Name of Registrant as Specified in its Charter)

Federal	42-1597948
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification Number)
40 Main Street, Putnam, Connecticut	06260
(Address of Principal Executive Office)	(Zip Code)

(860) 928-6501

(Registrant’s Telephone Number including area code)

Securities Registered Under to Section 12(b) of the Act:

Common Stock, par value $0.10 per share

(Title of Class)

The NASDAQ Stock Market LLC

(Name of exchange on which registered)

Securities Registered Under Section 12(g) of the Exchange Act:

None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.  YES  ¨  NO  x

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 of 15(d) of the Act. YES  ¨  NO  x

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file reports), and (2) has been subject to such requirements for the past 90 days.

(1)  YES  x  NO  ¨

(2)  YES  x  NO  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes  xNo ¨

Indicate by a check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendments to this Form 10-K. x

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer, or a smaller reporting company.  See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.  (Check one):

Large accelerated filer ¨	Accelerated filer  ¨
Non-accelerated filer  ¨	Smaller reporting company   x

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act)  ¨  YES    x  NO

The aggregate value of the voting stock held by non-affiliates of the Registrant, computed by reference to the closing price of the Common Stock as of December 31, 2011 ($4.50) was $7.9 million.

As of August 31, 2012, there were 6,528,863 shares outstanding of the Registrant’s Common Stock, including 3,729,846 shares owned by Putnam Bancorp, MHC.

DOCUMENTS INCORPORATED BY REFERENCE

None.

EXPLANATORY NOTE

This Amendment No. 1 to the Form 10-K for the fiscal year ended June 30, 2012, is filed solely to furnish Exhibit 101 in accordance with Rule 405(a)(2) of Regulation S-T. No other changes have been made to the Form 10-K. This Amendment No. 1 does not reflect events that may have occurred subsequent to the original filing date of the Form 10-K and does not modify or update in any way disclosures made in the Form 10-K.

Pursuant to Rule 406T of Regulation S-T, these interactive data files on Exhibit 101 are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, are deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, and otherwise are not subject to liability under those sections.

EXHIBITS

101 The following materials from the Company’s Annual Report on Form 10-K/A for the fiscal year ended June 30, 2012, formatted in XBRL: (i) the Condensed Consolidated Balance Sheets, (ii) the Condensed Consolidated Statements of  Income, (iii) the Condensed Consolidated Statements of Changes in Stockholders’ Equity, (iv) the Condensed  Consolidated Statements of Cash Flows and (v) the Notes to Condensed Consolidated Financial Statements.

SIGNATURES  

In accordance with Section 13 of the Exchange Act, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	PSB HOLDINGS, INC.
Date: October 3, 2012	By:	/S/    THOMAS A. BORNER
		Thomas A. Borner
		President and Chief Executive Officer and Director (Duly Authorized Representative)

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BENEFIT PLANS (Tables)

12 Months Ended

Jun. 30, 2012

Compensation and Retirement Disclosure [Abstract]

Schedule of the assumptions used to determine the weighted-average fair value of stock options granted

	November 7, 2005 Grant			June 7, 2006 Grant			May 25, 2007 Grant
Dividend yield		1.89	%		2.23	%		2.24	%
Expected volatility		12.65	%		12.17	%		11.04	%
Risk-free rate		4.56	%		4.95	%		4.86	%
Expected life in years		6.5			6.5			6.5
Fair value	$	2.00		$	1.97		$	1.84

Schedule of summary of the status of the Incentive Plan

	2012				2011
			Weighted				Weighted
			Average				Average
	Number of		Exercise		Number of		Exercise
	Shares		Price		Shares		Price
Outstanding at beginning of year		222,921	$	10.62		222,921	$	10.62
Granted		-		-		-		-
Exercised		-		-		-		-
Forfeited		-		-		-		-
Outstanding at end of year		222,921	$	10.62		222,921	$	10.62
Options exercisable at end of year		222,921	$	10.62		218,321	$	10.61

Schedule of the information about stock options outstanding

Options Outstanding							Options Exercisable
	Number		Weighted-Average				Number
Exercise	Outstanding		Remaining		Weighted-Average		Exercisable		Weighted-Average
Price	as of 6/30/12		Contractual Life		Exercise Price		as of 6/30/12		Exercise Price
$ 10.60		193,921		3.36	$	10.60		193,921	$	10.60
10.70		23,000		4.90		10.70		23,000		10.70
10.78		6,000		3.94		10.78		6,000		10.78

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LOANS - Summary of Loans (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Accounts, Notes, Loans and Financing Receivable [Line Items]
Allowance for loan losses	$ (2,913)	$ (3,072)
Net loans	248,572	253,225
Loans receivables
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	252,581	257,582
Unadvanced construction loans	(1,559)	(1,476)
Total loans after unadvanced construction loans	251,022	256,106
Net deferred loan costs	463	191
Allowance for loan losses	(2,913)	(3,072)
Net loans	248,572	253,225
Weighted average yield	4.95%	5.33%
Loans receivables | Residential real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Residential	200,148	193,084
Total loans after unadvanced construction loans	200,148	193,084
Loans receivables | Commercial real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Commercial real estate	45,032	53,248
Total loans after unadvanced construction loans	44,218	52,686
Loans receivables | Residential construction
Accounts, Notes, Loans and Financing Receivable [Line Items]
Residential construction	3,044	2,824
Total loans after unadvanced construction loans	2,299	1,910
Loans receivables | Commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Commercial	3,459	7,356
Total loans after unadvanced construction loans	3,459	7,356
Loans receivables | Consumer and other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Consumer and other	898	1,070
Total loans after unadvanced construction loans	$ 898	$ 1,070

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INVESTMENT SECURITIES - Summary of the estimated fair value and related unrealized losses segregated by category (Details 2) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012		Jun. 30, 2011
Schedule Of Available-For-Sale Securities and Held-To-Maturity Securities [Line Items]
Temporarily impaired available-for-sale less than 12 months fair value	$ 9,451		$ 14,133
Temporarily impaired available-for-sale less than 12 months unrealized losses	389		86
Temporarily impaired available-for-sale 12 months or more fair value	4,654		11,576
Temporarily impaired available-for-sale 12 months or more unrealized losses	1,344		1,422
Temporarily impaired available-for-sale securities continuous unrealized loss position fair value	14,105		25,709
Temporarily impaired available-for-sale securities continuous unrealized loss position aggregate losses	1,733		1,508
Temporarily impaired held-to-maturity securities continuous unrealized loss position less than twelve months fair value	12,398
Temporarily impaired held-to-maturity securities continuous unrealized loss position less than twelve months unrealized losses	17
Temporarily impaired held-to-maturity securities continuous unrealized loss position twelve months or longer fair value
Temporarily impaired held-to-maturity securities continuous unrealized loss position twelve months or longer unrealized losses
Temporarily impaired held-to-maturity securities continuous unrealized loss position fair value	12,398
Temporarily impaired held-to-maturity securities continuous unrealized loss position aggregate losses	17
Temporarily-impaired and other-than-temporarily impaired securities less than 12 months fair value	23,616		18,700
Temporarily-impaired and other-than-temporarily impaired securities less than 12 months unrealized losses	427		623
Temporarily-impaired and other-than-temporarily impaired securities 12 months or more fair value	11,166		18,731
Temporarily-impaired and other-than-temporarily impaired securities 12 months or more unrealized losses	2,573		3,772
Temporarily impaired and other than temporary impaired debt securities continuous unrealized loss position fair value	34,782		37,431
Temporarily impaired and other than temporary impaired debt securities continuous unrealized loss position unrealized losses	3,000		4,395
Debt securities | Corporate bonds and other securities
Schedule Of Available-For-Sale Securities and Held-To-Maturity Securities [Line Items]
Temporarily impaired available-for-sale less than 12 months fair value
Temporarily impaired available-for-sale less than 12 months unrealized losses
Temporarily impaired available-for-sale 12 months or more fair value	4,654		4,905
Temporarily impaired available-for-sale 12 months or more unrealized losses	1,344		1,093
Temporarily impaired available-for-sale securities continuous unrealized loss position fair value	4,654		4,905
Temporarily impaired available-for-sale securities continuous unrealized loss position aggregate losses	1,344		1,093
Debt securities | U.S. Government and government-sponsored securities
Schedule Of Available-For-Sale Securities and Held-To-Maturity Securities [Line Items]
Temporarily impaired held-to-maturity securities continuous unrealized loss position less than twelve months fair value	2,257
Temporarily impaired held-to-maturity securities continuous unrealized loss position less than twelve months unrealized losses	7
Temporarily impaired held-to-maturity securities continuous unrealized loss position twelve months or longer fair value
Temporarily impaired held-to-maturity securities continuous unrealized loss position twelve months or longer unrealized losses
Temporarily impaired held-to-maturity securities continuous unrealized loss position fair value	2,257
Temporarily impaired held-to-maturity securities continuous unrealized loss position aggregate losses	7
Debt securities | U.S. Government sponsored and guaranteed mortgage-backed securities
Schedule Of Available-For-Sale Securities and Held-To-Maturity Securities [Line Items]
Temporarily impaired available-for-sale less than 12 months fair value	1,826
Temporarily impaired available-for-sale less than 12 months unrealized losses	14
Temporarily impaired available-for-sale 12 months or more fair value
Temporarily impaired available-for-sale 12 months or more unrealized losses
Temporarily impaired available-for-sale securities continuous unrealized loss position fair value	1,826
Temporarily impaired available-for-sale securities continuous unrealized loss position aggregate losses	14
Temporarily impaired held-to-maturity securities continuous unrealized loss position less than twelve months fair value	10,141
Temporarily impaired held-to-maturity securities continuous unrealized loss position less than twelve months unrealized losses	10
Temporarily impaired held-to-maturity securities continuous unrealized loss position twelve months or longer fair value
Temporarily impaired held-to-maturity securities continuous unrealized loss position twelve months or longer unrealized losses
Temporarily impaired held-to-maturity securities continuous unrealized loss position fair value	10,141
Temporarily impaired held-to-maturity securities continuous unrealized loss position aggregate losses	10
Debt securities | Non-agency mortgage-backed securities
Schedule Of Available-For-Sale Securities and Held-To-Maturity Securities [Line Items]
Other-than-temporarily impaired debt securities less than 12 months fair value (1)	1,767	[1]
Other-than-temporarily impaired debt securities less than 12 months unrealized losses (1)	21	[1]
Other-than-temporarily impaired debt securities 12 months or more fair value (1)	6,512	[1]
Other-than-temporarily impaired debt securities 12 months or more unrealized losses (1)	1,229	[1]
Other than temporary impaired debt securities continuous unrealized loss position fair value	8,279	[1]
Other than temporary impaired debt securities continuous unrealized loss position unrealized losses	1,250	[1]
Debt securities | Mortgage-backed securities
Schedule Of Available-For-Sale Securities and Held-To-Maturity Securities [Line Items]
Temporarily impaired available-for-sale less than 12 months fair value			10,323
Temporarily impaired available-for-sale less than 12 months unrealized losses			45
Temporarily impaired available-for-sale 12 months or more fair value
Temporarily impaired available-for-sale 12 months or more unrealized losses
Temporarily impaired available-for-sale securities continuous unrealized loss position fair value			10,323
Temporarily impaired available-for-sale securities continuous unrealized loss position aggregate losses			45
Other-than-temporarily impaired debt securities less than 12 months fair value (1)			4,567	[1]
Other-than-temporarily impaired debt securities less than 12 months unrealized losses (1)			537	[1]
Other-than-temporarily impaired debt securities 12 months or more fair value (1)			7,155	[1]
Other-than-temporarily impaired debt securities 12 months or more unrealized losses (1)			2,350	[1]
Other than temporary impaired debt securities continuous unrealized loss position fair value			11,722	[1]
Other than temporary impaired debt securities continuous unrealized loss position unrealized losses			2,887	[1]
Debt securities | U.S. government and agency obligations
Schedule Of Available-For-Sale Securities and Held-To-Maturity Securities [Line Items]
Temporarily impaired available-for-sale less than 12 months fair value			3,810
Temporarily impaired available-for-sale less than 12 months unrealized losses			41
Temporarily impaired available-for-sale 12 months or more fair value
Temporarily impaired available-for-sale 12 months or more unrealized losses
Temporarily impaired available-for-sale securities continuous unrealized loss position fair value			3,810
Temporarily impaired available-for-sale securities continuous unrealized loss position aggregate losses			41
Equity securities
Schedule Of Available-For-Sale Securities and Held-To-Maturity Securities [Line Items]
Temporarily impaired available-for-sale less than 12 months fair value	7,625
Temporarily impaired available-for-sale less than 12 months unrealized losses	375
Temporarily impaired available-for-sale 12 months or more fair value			6,671
Temporarily impaired available-for-sale 12 months or more unrealized losses			329
Temporarily impaired available-for-sale securities continuous unrealized loss position fair value	7,625		6,671
Temporarily impaired available-for-sale securities continuous unrealized loss position aggregate losses	$ 375		$ 329

[1] Includes other-than-temporary impaired available-for-sale debt securities in which a portion of the other-than-temporary impairment loss remains in accumulated other comprehensive loss.

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DEPOSITS - Summary of deposits (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Jun. 30, 2011
Deposit Liabilities [Abstract]
Demand deposits	$ 43,785	$ 36,814
NOW accounts	92,662	92,273
Regular savings	54,495	50,283
Money market accounts	16,668	13,474
Club accounts	256	245
Deposit accounts	207,866	193,089
Weighted Average Rate, Demand deposits
Weighted Average Rate, NOW accounts	0.67%	0.81%
Weighted Average Rate, Regular savings	0.21%	0.34%
Weighted Average Rate, Money market accounts	0.48%	0.68%
Weighted Average Rate, Club accounts	0.15%	0.30%
Weighted Average Rate Domestic Deposit	0.39%	0.52%
Certificate accounts maturing in:
Certificate accounts maturing less than one year	60,699	71,200
Certificate accounts maturing in one to two years	30,251	24,112
Certificate accounts maturing in two to three years	18,439	22,182
Certificate accounts maturing in three to five years	25,083	23,190
Time Deposits	134,472	140,684
Weighted Average Interest Rate, Certificate accounts maturing in less than one year	1.28%	1.84%
Weighted Average Interest Rate, Certificate accounts maturing in one to two years	2.64%	2.43%
Weighted Average Interest Rate, Certificate accounts maturing in two to three years	2.59%	3.25%
Weighted Average Interest Rate, Certificate accounts maturing in three to five years	2.29%	2.91%
Weighted Average Interest Rate, Certificate accounts	1.96%	2.34%
Total deposits	$ 342,338	$ 333,773
Total deposits, weighted average interest rate	1.01%	1.29%

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LOANS - Summary of adjustable and fixed rate loans (Details 1) (Loans Receivable [Member], USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Jun. 30, 2011
Accounts, Notes, Loans and Financing Receivable [Line Items]
Fixed rate:	$ 150,394	$ 152,392
Adjustable rate:	100,628	103,714
Total loans	251,022	256,106
One month through one year
Accounts, Notes, Loans and Financing Receivable [Line Items]
Fixed rate:	9,275	8,701
Adjustable rate:	57,995	54,727
One year through three years
Accounts, Notes, Loans and Financing Receivable [Line Items]
Fixed rate:	6,344	12,800
Adjustable rate:	26,313	24,702
Three years through five years
Accounts, Notes, Loans and Financing Receivable [Line Items]
Fixed rate:	7,785	8,905
Adjustable rate:	10,814	17,865
Five years through ten years
Accounts, Notes, Loans and Financing Receivable [Line Items]
Fixed rate:	22,504	24,098
Over five years
Accounts, Notes, Loans and Financing Receivable [Line Items]
Adjustable rate:	5,506	6,420
Over ten years
Accounts, Notes, Loans and Financing Receivable [Line Items]
Fixed rate:	$ 104,486	$ 97,888

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INCOME TAXES (Details Textuals) (USD $)	Jun. 30, 2012	Jun. 30, 2011
Income Tax Disclosure [Abstract]
Contingency reserve for loan losses	$ 2,284,000
Deferred income taxes	$ 777,000	$ 777,000

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INVESTMENT SECURITIES - Carrying value and estimated market values of investment securities (Details) (USD $)	Jun. 30, 2012	Jun. 30, 2011
Securities available for sale:
Available-for-sale securities, amortized cost basis	$ 48,747,000	$ 59,928,000
Available-for-sale securities, gross unrealized gains	1,449,000	2,391,000
Available-for-sale Securities, gross unrealized losses	(2,983,000)	(4,310,000)
Total available-for-sale securities	47,213,000	58,009,000
Held-to-maturity Securities, Unclassified [Abstract]
Total held-to-maturity securities	105,195,000	114,741,000
Total held-to-maturity securities	3,158,000	1,306,000
Total held-to-maturity securities	(17,000)	(85,000)
Total held-to-maturity securities	108,336,000	115,962,000
Debt securities
Securities available for sale:
Total available-for-sale securities	38,747,000
Total available-for-sale securities	1,438,000
Total available-for-sale securities	(2,608,000)
Total available-for-sale securities	37,577,000
Debt securities | U.S. Government and government-sponsored securities
Securities available for sale:
Available-for-sale due in one year or less amortized cost basis	450,000
Available-for-sale due in one year or less gross unrealized gain	9,000
Available-for-sale due in one year or less gross unrealized (loss)
Available-for-sale due in one year or less fair value	459,000
Held-to-maturity Securities, Unclassified [Abstract]
Held-to-maturity from one through five years amortized cost basis	5,996,000	2,000,000
Held-to-maturity from five through ten years amortized cost basis	3,196,000	11,234,000
Held-to-maturity after ten years amortized cost basis		2,851,000
Total held-to-maturity securities	9,192,000	16,085,000
Held-to-maturity from one through five years unrealized gain	34,000	34,000
Held-to-maturity from five through ten years unrealized gain	149,000	51,000
Held-to-maturity after ten years gross unrealized gain
Total held-to-maturity securities	183,000	85,000
Held-to-maturity from one through five years unrealized (loss)
Held-to-maturity from five through ten years unrealized (loss)	(7,000)	(26,000)
Held-to-maturity after ten years gross unrealized (loss)		(15,000)
Total held-to-maturity securities	(7,000)	(41,000)
Held-to-maturity from one through five years fair value	6,030,000	2,034,000
Held-to-maturity from five through ten years fair value	3,338,000	11,259,000
Held-to-maturity after ten years gross fair value		2,836,000
Total held-to-maturity securities	9,368,000	16,129,000
Debt securities | Corporate bonds and other securities
Securities available for sale:
Available-for-sale after ten years amortized cost basis	5,998,000	5,998,000
Available-for-sale from after ten years gross unrealized gain
Available-for-sale after ten years gross unrealized (loss)	(1,344,000)	(1,093,000)
Available-for-sale after ten years fair value	4,654,000	4,905,000
Debt securities | U.S. Government sponsored and guaranteed mortgage-backed securities
Securities available for sale:
Available-for-sale due in one year or less amortized cost basis	1,000
Available-for-sale from one through five years amortized cost basis	416,000
Available-for-sale from five through ten years amortized cost basis	2,564,000
Available-for-sale after ten years amortized cost basis	19,717,000
Total available-for-sale securities	22,698,000
Available-for-sale due in one year or less gross unrealized gain
Available-for-sale from one through five years gross unrealized gain	24,000
Available-for-sale from five through ten years gross unrealized gain	140,000
Available-for-sale from after ten years gross unrealized gain	1,265,000
Total available-for-sale securities	1,429,000
Available-for-sale due in one year or less gross unrealized (loss)
Available-for-sale from one through five years gross unrealized (loss)
Available-for-sale from five through ten years gross unrealized (loss)
Available-for-sale after ten years gross unrealized (loss)	(14,000)
Total available-for-sale securities	(14,000)
Available-for-sale due in one year or less fair value	1,000
Available-for-sale from one through five years fair value	440,000
Available-for-sale from five through ten years fair value	2,704,000
Available-for-sale after ten years fair value	20,968,000
Total available-for-sale securities	24,113,000
Held-to-maturity Securities, Unclassified [Abstract]
Held-to-maturity from one through five years amortized cost basis	6,767,000
Held-to-maturity from five through ten years amortized cost basis	89,236,000
Total held-to-maturity securities	96,003,000
Held-to-maturity from one through five years unrealized gain	192,000
Held-to-maturity from five through ten years unrealized gain	2,783,000
Total held-to-maturity securities	2,975,000
Held-to-maturity from one through five years unrealized (loss)
Held-to-maturity from five through ten years unrealized (loss)	(10,000)
Total held-to-maturity securities	(10,000)
Held-to-maturity from one through five years fair value	6,959,000
Held-to-maturity from five through ten years fair value	92,009,000
Total held-to-maturity securities	98,968,000
Debt securities | Non-agency mortgage-backed securities
Securities available for sale:
Available-for-sale after ten years amortized cost basis	9,601,000
Available-for-sale from after ten years gross unrealized gain
Available-for-sale after ten years gross unrealized (loss)	(1,250,000)
Available-for-sale after ten years fair value	8,351,000
Debt securities | Mortgage-backed securities
Securities available for sale:
Total available-for-sale securities		43,253,000
Total available-for-sale securities		1,673,000
Total available-for-sale securities		(2,888,000)
Total available-for-sale securities		42,038,000
Held-to-maturity Securities, Unclassified [Abstract]
Total held-to-maturity securities	98,656,000
Total held-to-maturity securities	1,221,000
Total held-to-maturity securities	(44,000)
Total held-to-maturity securities	99,833,000
Debt securities | U.S. government and agency obligations
Securities available for sale:
Available-for-sale from one through five years amortized cost basis		630,000
Available-for-sale from one through five years gross unrealized gain		36,000
Available-for-sale from one through five years gross unrealized (loss)
Available-for-sale from one through five years fair value		666,000
Equity securities | Auction rate preferred stock
Securities available for sale:
Available-for-sale equity securities, amortized cost basis	10,000,000	10,047,000
Available-for-sale securities equity securities gross unrealized gains	11,000	682,000
Available-for-sale securities equity securities gross unrealized loss	(375,000)	(329,000)
Available-for-sale securities equity securities fair value	$ 9,636,000	$ 10,400,000

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BORROWED FUNDS (Tables)

12 Months Ended

Jun. 30, 2012

Debt Disclosure [Abstract]

Schedule of the borrowed funds

	2012					2011
	Amount Due		Weighted			Amount Due		Weighted
			Average					Average
			Rate					Rate
	(Dollars in thousands)
Short-term borrowing
Securities sold under agreements to repurchase	$	3,653		0.17	%		4,244		0.27	%
Total short-term borrowings		3,653		0.17			4,244		0.27
Long-term FHLB of Boston (FHLB) advances
Year of maturity:
2012		-		-			32,000		4.56
2013		5,000		3.23			5,000		3.23
2014		17,500		3.19			17,500		3.19
2015		1,000		3.35			1,000		3.35
2016		10,000		3.17			10,000		3.17
2017		12,000		3.89			10,000		4.15
2018		8,000		3.91			8,000		3.91
Total long-term borrowings		53,500		3.46			83,500		3.90
Total borrowed funds	$	57,153		3.25	%	$	87,744		3.72	%

XML

COMMITMENTS AND CONTINGENT LIABILITIES - Summary of total minimum rental due in future periods under these existing agreements (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012
Commitments and Contingencies Disclosure [Abstract]
Rental Expense Due in 2013	$ 154
Rental Expense Due in 2014	150
Rental Expense Due in 2015	98
Rental Expense Due in 2016	51
Rental Expense Due in 2017	8
Rental Expense Due Thereafter
Rental Expense Due, Total	$ 461

XML

BORROWED FUNDS - Summary of Long-term FHLB of Boston (FHLB) advances (Details 1) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Jun. 30, 2011
FHLB advances, Year of maturity:
Amount due in 2012		$ 32,000
Amount due in 2013	5,000	5,000
Amount due in 2014	17,500	17,500
Amount due in 2015	1,000	1,000
Amount due in 2016	10,000	10,000
Amount due in 2017	12,000	10,000
Amount Due in 2018	8,000	8,000
Federal Home Loan Bank advances	53,500	83,500
Weighted Average Rate, 2012		4.56%
Weighted Average Rate, 2013	3.23%	3.23%
Weighted Average Rate, 2014	3.19%	3.19%
Weighted Average Rate, 2015	3.35%	3.35%
Weighted Average Rate, 2016	3.17%	3.17%
Weighted Average Rate, 2017	3.89%	4.15%
Weighted Average Rate, 2018	3.91%	3.91%
Weighted Average Rate, Total long-term borrowings	3.46%	3.90%
Total borrowed funds, amount due	$ 57,153	$ 87,744
Weighted average rate, borrowed funds	3.25%	3.72%

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BENEFIT PLANS - Summary of assumptions used to determine weighted-average fair value of stock options granted (Details) (USD $)	0 Months Ended		1 Months Ended
	Jun. 07, 2006	Nov. 07, 2005	May 25, 2007
Compensation and Retirement Disclosure [Abstract]
Dividend yield	2.23%	1.89%	2.24%
Expected volatility	12.17%	12.65%	11.04%
Risk-free rate	4.95%	4.56%	4.86%
Expected life in years	6 years 6 months	6 years 6 months	6 years 6 months
Fair value	$ 1.97	$ 2.00	$ 1.84

XML

LOANS - Summary of company's loans by risk rating (Details 3) (Loans receivables, USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Jun. 30, 2011
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans	$ 251,022	$ 256,106
Pass
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans	233,464	238,585
Special Mention
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans	2,682	4,653
Substandard
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans	14,027	12,868
Doubtful
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans	849
Loss
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans
Residential real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans	200,148	193,084
Residential real estate | Pass
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans	195,825	191,309
Residential real estate | Special Mention
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans	338	23
Residential real estate | Substandard
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans	3,605	1,752
Residential real estate | Doubtful
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans	380
Residential real estate | Loss
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans
Commercial real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans	44,218	52,686
Commercial real estate | Pass
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans	32,032	37,787
Commercial real estate | Special Mention
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans	1,719	3,783
Commercial real estate | Substandard
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans	9,998	11,116
Commercial real estate | Doubtful
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans	469
Commercial real estate | Loss
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans
Residential construction
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans	2,299	1,910
Residential construction | Pass
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans	1,875	1,910
Residential construction | Special Mention
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans
Residential construction | Substandard
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans	424
Residential construction | Doubtful
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans
Residential construction | Loss
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans
Commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans	3,459	7,356
Commercial | Pass
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans	2,834	6,509
Commercial | Special Mention
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans	625	847
Commercial | Substandard
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans
Commercial | Doubtful
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans
Commercial | Loss
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans
Consumer and other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans	898	1,070
Consumer and other | Pass
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans	898	1,070
Consumer and other | Special Mention
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans
Consumer and other | Substandard
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans
Consumer and other | Doubtful
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans
Consumer and other | Loss
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans after unadvanced construction loans

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INCOME TAXES - Summary of differences between statutory federal income tax rate of 34% and effective tax rates (Details 1) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Income Tax Disclosure [Abstract]
Federal income tax at statutory rates	$ 430	$ 556
Increase (decrease) in tax resulting from:
State taxes, net of federal benefit	1	1
Qualifying option (benefit) expense	(3)	9
Dividends received deduction	(112)	(113)
Bank-owned life insurance	(111)	(138)
Tax-exempt municipal income, net	(14)	(14)
Expiration unused contributions		92
Other, net	24	144
Income tax expense	$ 215	$ 537
Effective tax rates	17.00%	32.80%

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OFF-BALANCE SHEET FINANCIAL INSTRUMENTS (Details Textuals) (Letters of credit, USD $)	Jun. 30, 2012	Jun. 30, 2011
Letters of credit
Line of Credit Facility [Line Items]
Maximum potential amount of the company's obligation for financial and standby letters of credit	$ 842,000	$ 782,000

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FAIR VALUE MEASUREMENTS - Assets measured at fair value on a recurring basis (Details) (Fair Value, Measurements, Recurring, USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Jun. 30, 2011
Total Fair Value
Securities available for sale:
Assets measured at fair value	$ 47,213	$ 58,009
Total Fair Value | U.S. government and government-sponsored securities
Securities available for sale:
Assets measured at fair value	459	666
Total Fair Value | Corporate bonds and other securities
Securities available for sale:
Assets measured at fair value	4,654	4,905
Total Fair Value | U.S. Government sponsored and guaranteed mortgage-backed securities
Securities available for sale:
Assets measured at fair value	24,113	30,316
Total Fair Value | Non-agency mortgage-backed securities
Securities available for sale:
Assets measured at fair value	8,351	11,722
Total Fair Value | Equity securities
Securities available for sale:
Assets measured at fair value	9,636	10,400
Quoted Prices in Active Markets for Identical Assets Level 1
Securities available for sale:
Assets measured at fair value
Quoted Prices in Active Markets for Identical Assets Level 1 | U.S. government and government-sponsored securities
Securities available for sale:
Assets measured at fair value
Quoted Prices in Active Markets for Identical Assets Level 1 | Corporate bonds and other securities
Securities available for sale:
Assets measured at fair value
Quoted Prices in Active Markets for Identical Assets Level 1 | U.S. Government sponsored and guaranteed mortgage-backed securities
Securities available for sale:
Assets measured at fair value
Quoted Prices in Active Markets for Identical Assets Level 1 | Non-agency mortgage-backed securities
Securities available for sale:
Assets measured at fair value
Quoted Prices in Active Markets for Identical Assets Level 1 | Equity securities
Securities available for sale:
Assets measured at fair value
Significant Other Observable Inputs Level 2
Securities available for sale:
Assets measured at fair value	37,577	47,609
Significant Other Observable Inputs Level 2 | U.S. government and government-sponsored securities
Securities available for sale:
Assets measured at fair value	459	666
Significant Other Observable Inputs Level 2 | Corporate bonds and other securities
Securities available for sale:
Assets measured at fair value	4,654	4,905
Significant Other Observable Inputs Level 2 | U.S. Government sponsored and guaranteed mortgage-backed securities
Securities available for sale:
Assets measured at fair value	24,113	30,316
Significant Other Observable Inputs Level 2 | Non-agency mortgage-backed securities
Securities available for sale:
Assets measured at fair value	8,351	11,722
Significant Other Observable Inputs Level 2 | Equity securities
Securities available for sale:
Assets measured at fair value
Significant Unobservable Inputs Level 3
Securities available for sale:
Assets measured at fair value	9,636	10,400
Significant Unobservable Inputs Level 3 | U.S. government and government-sponsored securities
Securities available for sale:
Assets measured at fair value
Significant Unobservable Inputs Level 3 | Corporate bonds and other securities
Securities available for sale:
Assets measured at fair value
Significant Unobservable Inputs Level 3 | U.S. Government sponsored and guaranteed mortgage-backed securities
Securities available for sale:
Assets measured at fair value
Significant Unobservable Inputs Level 3 | Non-agency mortgage-backed securities
Securities available for sale:
Assets measured at fair value
Significant Unobservable Inputs Level 3 | Equity securities
Securities available for sale:
Assets measured at fair value	$ 9,636	$ 10,400

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REGULATORY MATTERS - Summary of bank's actual capital amounts and ratios (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Jun. 30, 2011
Commitments and Contingencies Disclosure [Abstract]
Tangible Equity Capital (to Tangible Assets)	$ 36,587	$ 35,673
Tier 1 Capital (to Adjusted Total Assets)	36,587	35,673
Tier 1 Capital (to Risk-Weighted Assets)	36,587	35,673
Total Capital (to Risk-Weighted Assets)	39,523	36,465
Tangible Equity Capital (to Tangible Assets)	8.24%	7.68%
Tier 1 Capital (to Adjusted Total Assets)	8.24%	7.68%
Tier 1 Capital (to Risk-Weighted Assets)	15.15%	14.79%
Total Capital (to Risk-Weighted Assets)	16.36%	16.04%
Tangible Equity Capital (to Tangible Assets)	6,661	6,967
Tier 1 Capital (to Adjusted Total Assets)	17,763	18,578
Tier 1 Capital (to Risk-Weighted Assets)	9,661	9,095
Total Capital (to Risk-Weighted Assets)	19,322	18,190
Tangible Equity Capital (to Tangible Assets)	1.50%	1.50%
Tier 1 Capital (to Adjusted Total Assets)	4.00%	4.00%
Tier 1 Capital (to Risk-Weighted Assets)	4.00%	4.00%
Total Capital (to Risk-Weighted Assets)	8.00%	8.00%
Tangible Equity Capital (to Tangible Assets)
Tier 1 Capital (to Adjusted Total Assets)	22,204	23,222
Tier 1 Capital (to Risk-Weighted Assets)	14,491	13,643
Total Capital (to Risk-Weighted Assets)	$ 24,152	$ 22,738
Tangible Equity Capital (to Tangible Assets)	0.00%	0.00%
Tier 1 Capital (to Adjusted Total Assets)	5.00%	5.00%
Tier 1 Capital (to Risk-Weighted Assets)	6.00%	6.00%
Total Capital (to Risk-Weighted Assets)	10.00%	10.00%

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INCOME TAXES - Summary of gross deferred tax assets and gross deferred tax liabilities (Details 2) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Jun. 30, 2011
Deferred tax assets:
Allowance for loan losses	$ 918	$ 985
Net unrealized holding loss on available-for-sale securities	521	652
Deferred compensation	188	190
Stock-based compensation	64	59
Impairment losses on securities available-for-sale	1,093	1,769
Accrued expenses	159
Post retirement benefits	55	37
Interest receivable on non-accrual loans	168	134
Federal carryovers	1,516	1,043
Other	68	42
Gross deferred tax asset	4,750	4,911
Deferred tax liabilities:
Depreciation and amortization	(703)	(630)
Deferred loan costs	(157)	(65)
Gross deferred tax liability	(860)	(695)
Net deferred tax asset	$ 3,890	$ 4,216

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DEPOSITS (Details Textuals) (USD $)	Jun. 30, 2012	Jun. 30, 2011
Deposit Liabilities [Abstract]
Aggregate amount of time deposit accounts in denominations of $100,000 or more	$ 62,390,000	$ 64,650,000

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PARENT COMPANY ONLY FINANCIAL STATEMENTS

12 Months Ended

Jun. 30, 2012

Condensed Financial Information Of Parent Company Only Disclosure [Abstract]

PARENT COMPANY ONLY FINANCIAL STATEMENTS

16.         PARENT COMPANY ONLY FINANCIAL STATEMENTS

              The following financial statements are for the Company (Parent Company) and should be read in conjunction with the consolidated financial statements of the Company.

PSB Holdings, Inc. and Subsidiary

(Parent Company Only)

Balance Sheets

June 30, 2012 and 2011

(In thousands)

	June 30,
	2012		2011
ASSETS
Cash and due from depository institutions	$	556	$	434
Investment in Putnam Bank		44,150		42,765
Investment in available-for-sale securities (at fair value)		169		225
Investment in held-to-maturity securities (fair value of $1,003)		1,000		1,000
Loan to ESOP		1,863		1,985
Other assets		421		379
Total assets	$	48,159	$	46,788
LIABILITIES AND STOCKHOLDERS’ EQUITY
Other liabilities	$	24	$	41
Stockholders’ equity		48,135		46,747
Total liabilities and stockholders’ equity	$	48,159	$	46,788

PSB Holdings, Inc. and Subsidiary

(Parent Company Only)

Statements of Income

For the Years Ended June 30, 2012 and 2011

(In thousands)

	2012			2011
Interest and dividends on investments	$	20		$	26
Interest on loan		63			67
Total interest and dividend income		83			93
Interest expense		-			-
Net interest and dividend income		83			93
Other expense		220			183
Loss before income tax (benefit) expense and equity in undistributed net income of subsidiary		(137	)		(90	)
Income tax (benefit) expense		(56	)		71
Loss before equity in undistributed net income of subsidiary		(81	)		(161	)
Equity in undistributed net income of subsidiary		1,131			1,259
Net income	$	1,050		$	1,098

PSB Holdings, Inc. and Subsidiary

(Parent Company Only)

Statements of Cash Flows

June 30, 2012 and 2011

(In thousands)

	2012			2011
Cash flows from operating activities
Net income
Adjustments to reconcile net income to net cash provided by operating activities:	$	1,050		$	1,098
Amortization of securities, net		1			-
Amortization of ESOP expense		60			57
(Increase) decrease in other assets		(42	)		60
(Increase) decrease in due from subsidiary		(4	)		176
Increase in due to subsidiary		(6	)		-
Decrease in other liabilities		(10	)		(118	)
Stock-based compensation expense		27			234
Undistributed net income of subsidiary		(1,131	)		(1,259	)
Net cash (used in) provided by operating activities		(55	)		248
Cash flows from investing activities:
Proceeds from maturities of available-for-sale securities		55			1,030
Purchase of held-to-maturity securities		-			(1,000	)
Principal payments received on loan to ESOP		122			118
Net cash provided by investing activities		177			148
Net cash provided by financing activities		-			-
Net increase in cash and cash equivalents		122			396
Cash and cash equivalents at beginning of year		434			38
Cash and cash equivalents at end of year	$	556		$	434

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INVESTMENT SECURITIES - Amount of credit losses on debt securities for which a portion of an other-than-temporary impairment was recognized in other comprehensive income(Details 4) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Other than Temporary Impairment, Credit Losses Recognized in Earnings [Roll Forward]
Balance	$ 13,307	$ 12,242
Credit losses on securities for which other-than-temporary impairment was not previously recorded		3
Additional credit losses on securities for which an other-than-temporary impairment charge was previously recorded	1,964	1,062
Reductions for securities sold during the period
Balance	$ 15,271	$ 13,307

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NATURE OF OPERATIONS (Details Textuals 1)	Jun. 30, 2012	Jun. 30, 2011
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items]
Common stock, shares issued	6,943,125	6,943,125
Putnam Savings Foundation
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items]
Common stock, shares issued	123,588
Percentage of common stock issued	4.00%
ESOP
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items]
Number of shares of common stock purchased	257,062

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INCOME TAXES - Summary of income tax expense (benefit) (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Current:
Federal	$ 18	$ 723
State	2	1
Current Income Tax Expense (Benefit)	20	724
Deferred:
Federal	195	(187)
State
Total deferred	195	(187)
Income tax expense	$ 215	$ 537

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PARENT COMPANY ONLY FINANCIAL STATEMENTS - Balance Sheets [Parentheticals] (Details 3) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Jun. 30, 2011
Condensed Financial Statements, Captions [Line Items]
Investments in held-to-maturity securities, fair value (in dollars)	$ 108,336	$ 115,962
PSB Holdings, Inc.
Condensed Financial Statements, Captions [Line Items]
Investments in held-to-maturity securities, fair value (in dollars)	$ 1,003

XML

OFF-BALANCE SHEET FINANCIAL INSTRUMENTS (Tables)

12 Months Ended

Jun. 30, 2012

Off Balance Sheet Financial Instruments [Abstract]

Schedule of notional amounts of commitments with off-balance-sheet credit risk

	2012		2011
	(In thousands)
Commitments to originate loans	$	3,646	$	2,966
Unadvanced portions of loans:
Construction loans		1,559		1,476
Lines of credit		12,690		12,737
Letters of credit		842		782
Outstanding commitments	$	18,737	$	17,961

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INVESTMENT SECURITIES (Details Textuals) (USD $)	12 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Schedule Of Available-For-Sale Securities and Held-To-Maturity Securities [Line Items]
Proceeds from sales of available-for-sale securities	$ 328,000	$ 6,636,000
Gross realized gains	235,000	254,000
Gross realized losses	0	0
Amount received as legal settlement on securities	1,452,000	420,000
Minium percentage of stockholder's equity	10.00%
Fair Value of securities pledged as collateral secure public deposits, the Federal Reserve Bank discount window, borrowings and repurchase agreements	$ 69,965,000	$ 35,841,000
Debt securities | Corporate bonds and other securities
Schedule Of Available-For-Sale Securities and Held-To-Maturity Securities [Line Items]
Number of available for sale securities with unrealized losses	5

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GOODWILL AND INTANGIBLE ASSETS - Summary of expected future amortization expense (Details 1) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Jun. 30, 2011
Goodwill and Intangible Assets Disclosure [Abstract]
Expected future amortization expense for 2013	$ 93
Expected future amortization expense for 2014	65
Expected future amortization expense for 2015	36
Expected future amortization expense for 2016	8
Total	$ 202	$ 324

XML

Loans - Summary of troubled debt restructurings that have subsequently defaulted within one year of modification (Details 7) (Loans receivables, USD $) In Thousands, unless otherwise specified	Jun. 30, 2012 Contracts
Accounts, Notes, Loans and Financing Receivable [Line Items]
Number of Contracts	3
Recorded Investment	$ 453
Residential Real Estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Number of Contracts	2
Recorded Investment	229
Commercial Real Estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Number of Contracts	1
Recorded Investment	$ 224

XML

INVESTMENT SECURITIES- Information on the various issuers of auction rate preferred securities owned by the company (Details 1) (USD $) In Thousands, unless otherwise specified			12 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012 Merrill Lynch Auction Rate Pass Thru
Schedule of Available-for-sale Securities [Line Items]
Issuer			Merrill Lynch Auction Rate Pass Thru
Amortized Cost	$ 48,747	$ 59,928	$ 5,000
Fair Value	$ 47,213	$ 58,009	$ 4,868

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Consolidated Statements of Cash Flows (USD $)	12 Months Ended
	Jun. 30, 2012		Jun. 30, 2011
Cash flows from operating activities:
Net income	$ 1,050,000		$ 1,098,000
Adjustments to reconcile net income to cash provided by operating activities:
Amortization of securities, net	1,309,000		1,197,000
Gain on sales and calls of securities, net	(235,000)		(257,000)
Impairment losses on securities	1,964,000	[1]	1,065,000	[1]
Net decrease (increase) in loans held for sale	791,000		(97,000)
(Accretion) amortization of deferred loan (fees) costs, net	(75,000)		94,000
Provision for loan losses	1,152,000		915,000
Gain on sale of other real estate owned	(1,000)		(59,000)
Write-down of other real estate owned	71,000		95,000
Loss on disposal of equipment	5,000		7,000
Depreciation and amortization	464,000		512,000
Amortization of intangible asset	122,000		149,000
Decrease in accrued interest receivable and other assets	1,538,000		2,554,000
Increase in cash surrender value of bank owned life insurance	(328,000)		(407,000)
Increase in other liabilities	214,000		288,000
Deferred tax expense (benefit)	195,000		(187,000)
Amortization of ESOP expense	60,000		57,000
Stock-based compensation	24,000		120,000
Net cash provided by operating activities	8,320,000		7,144,000
Cash flows from investing activities:
Purchase of available-for-sale securities	(5,503,000)
Proceeds from sales, call, paydowns and maturities of available-for-sale securities	14,922,000		29,299,000
Purchase of held-to maturity securities	(32,483,000)		(93,692,000)
Proceeds from calls, paydowns and maturities of held-to-maturity securities	38,753,000		61,066,000
Redemption of Federal Home Loan Bank stock	520,000
Loan repayments net of originations	1,825,000		282,000
Purchase of bank-owned life insurance	(2,000,000)
Recoveries of loans previously charged off	41,000		60,000
Proceeds from sale of other real estate owned	1,031,000		607,000
Proceeds from the surrender of bank-owned life insurance policy			167,000
Capital expenditures - premises and equipment	(528,000)		(65,000)
Net cash provided by (used in) investing activities	16,578,000		(2,276,000)
Cash flows from financing activities:
Net increase (decrease) in deposit accounts	8,565,000		(1,373,000)
Net increase in mortgagors' escrow accounts	268,000		139,000
Proceeds from Federal Home Loan Bank advances	3,830,000		10,000,000
Repayments of Federal Home Loan Bank advances	(33,830,000)		(27,000,000)
Net decrease in securities sold under agreements to repurchase	(591,000)		(1,652,000)
Net cash used in financing activities	(21,758,000)		(19,886,000)
Net increase (decrease) in cash and cash equivalents	3,140,000		(15,018,000)
Cash and cash equivalents at beginning of year	8,273,000		23,291,000
Cash and cash equivalents at end of year	11,413,000		8,273,000
Supplemental disclosures:
Interest paid	6,768,000		8,429,000
Income taxes refunded	(432,000)		(864,000)
Loans transferred to other real estate owned	1,710,000		709,000
Increase in due from broker	(2,000,000)
Deferred gain on sale of other real estate owned in other liabilities			(40,000)
Loans originated to finance sales of other real estate owned	$ 233,000		$ 513,000

[1] Represents the credit component of the other-than-temporary impairment.

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LOANS (Details Textuals) (USD $)	12 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Related Party Transaction [Line Items]
Additional funds are committed to be advanced in connection with TDR's	$ 567,000
Unpaid principal balances of mortgage and other loans serviced for others	30,542,000	32,277,000
Maximum contingent liability	445,000
Director And Executive Officers
Related Party Transaction [Line Items]
Total loans from company and companies have significant ownership interest	61,000	80,000
Principal payments of loans from company and companies have significant ownership interest	19,000	17,000
Principal advances of loans from company and companies have significant ownership interest	$ 0	$ 25,000

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) (USD $)	12 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Basic EPS:
Net income	$ 1,050,000	$ 1,098,000
Net income and income allocated to common stockholders	1,050,000	1,096,000
Basic (in shares)	6,364,345	6,342,473
Dividends and undistributed earnings allocated to unvested shares		(2,000)
Basic (in dollars per share)	$ 0.16	$ 0.17
Diluted EPS:
Net income	1,050,000	1,098,000
Effect of dilutive securities options and warrants		0
Diluted (in dollars per share)	$ 0.16	$ 0.17
Diluted (in shares)	6,364,345	6,342,473
Income attributable to common stockholders and assumed conversions		$ 1,096,000

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Loans (Tables)

12 Months Ended

Jun. 30, 2012

Accounts, Notes, Loans and Financing Receivable, Gross, Allowance, and Net [Abstract]

Schedule of composition of loan portfolio

	2012			2011
	(Dollars in thousands)
Mortgage loans:
Residential	$	200,148		$	193,084
Commercial real estate		45,032			53,248
Residential construction		3,044			2,824
Commercial		3,459			7,356
Consumer and other		898			1,070
Total loans		252,581			257,582
Unadvanced construction loans		(1,559	)		(1,476	)
		251,022			256,106
Net deferred loan costs		463			191
Allowance for loan losses		(2,913	)		(3,072	)
Loans, net	$	248,572		$	253,225
Weighted average yield		4.95	%		5.33	%

Schedule of the composition of the company's loan portfolio, by maturity

	2012		2011
	(In thousands)
Fixed rate:
Term to maturity
One month through one year	$	9,275	$	8,701
One year through three years		6,344		12,800
Three years through five years		7,785		8,905
Five years through ten years		22,504		24,098
Over ten years		104,486		97,888
		150,394		152,392
Adjustable rate:
Rate adjustment
One month through one year		57,995		54,727
One year through three years		26,313		24,702
Three years through five years		10,814		17,865
Over five years		5,506		6,420
		100,628		103,714
Total loans	$	251,022	$	256,106

Schedule of the allowance for loan losses by portfolio segment

	Residential			Commercial			Residential						Consumer
	Real Estate			Real Estate			Construction			Commercial			& Other			Unallocated			Total
	(In thousands)
Year Ended June 30, 2012
Allowance for loan losses:
Beginning balance	$	1,520		$	1,286		$	28		$	140		$	11		$	87		$	3,072
Charge-offs		(364	)		(928	)		-			-			(60	)		-			(1,352	)
Recoveries		7			-			-			11			23			-			41
Provision		322			989			(8	)		(134	)		63			(80	)		1,152
Ending balance	$	1,485		$	1,347		$	20		$	17		$	37		$	7		$	2,913
At June 30, 2012
Ending balance: Amount of allowance for impaired loans	$	185		$	190		$	-		$	-		$	-		$	-		$	375
Ending balance: Amount of allowance for loan losses for non-impaired loans	$	1,300		$	1,157		$	20		$	17		$	37		$	7		$	2,538
Loans:  Ending balance	$	200,148		$	44,218		$	2,299		$	3,459		$	898		$	-		$	251,022	(1)
Ending balance: Impaired loans	$	4,846		$	10,070		$	424		$	-		$	27		$	-		$	15,367
Ending balance: Non-impaired loans	$	195,302		$	34,148		$	1,875		$	3,459		$	871		$	-		$	235,655
(1) Does not include deferred fees or costs.
	Residential			Commercial			Residential						Consumer
	Real Estate			Real Estate			Construction			Commercial			& Other			Unallocated			Total
	(In thousands)
June 30, 2011
Allowance for credit losses:
Beginning balance	$	1,332		$	901		$	10		$	297		$	43		$	68		$	2,651
Charge-offs		208			62			-			212			72			-			554
Recoveries		6			-			-			18			36			-			60
Provision		390			447			18			37			4			19			915
Ending Balance	$	1,520		$	1,286		$	28		$	140		$	11		$	87		$	3,072
Ending balance: Individually evaluated for impairment	$	236		$	686		$	-		$	-		$	6		$	-		$	928
Ending balance: Collectively evaluated for impairment	$	1,284		$	600		$	28		$	140		$	5		$	87		$	2,144
Loans:
Ending Balance	$	193,084		$	52,686		$	1,910		$	7,356		$	1,070		$	-		$	256,106
Ending balance: Individually evaluated for impairment	$	2,415		$	8,093		$	-		$	-		$	57		$	-		$	10,565
Ending balance: Collectively evaluated for impairment	$	190,669		$	44,593		$	1,910		$	7,356		$	1,013		$	-		$	245,541

Schedule of the company's loans by risk rating

	Residential		Commercial		Residential				Consumer
	Real Estate		Real Estate		Construction		Commercial		& Other		Total
	(In thousands)
June 30, 2012
Grade:
Pass	$	195,825	$	32,032	$	1,875	$	2,834	$	898	$	233,464
Special Mention		338		1,719		-		625		-		2,682
Substandard		3,605		9,998		424		-		-		14,027
Doubtful		380		469		-		-		-		849
Loss		-		-		-		-		-		-
Total	$	200,148	$	44,218	$	2,299	$	3,459	$	898	$	251,022
	Residential		Commercial		Residential				Consumer
	Real Estate		Real Estate		Construction		Commercial		& Other		Total
	(In thousands)
June 30, 2011
Grade:
Pass	$	191,309	$	37,787	$	1,910	$	6,509	$	1,070	$	238,585
Special Mention		23		3,783		-		847		-		4,653
Substandard		1,752		11,116		-		-		-		12,868
Doubtful		-		-		-		-		-		-
Loss		-		-		-		-		-		-
Total	$	193,084	$	52,686	$	1,910	$	7,356	$	1,070	$	256,106

Schedule of the summary of past due and non-accrual loans

					90 days
	30–59 Days		60–89 Days		or Greater		Total		Total
	Past Due		Past Due		Past Due		Past Due		Non-accrual
	(In thousands)
2012
Real estate:
Residential	$	363	$	162	$	940	$	1,465	$	3,985
Commercial		159		-		1,573		1,732		3,975
Residential construction		-		-		424		424		424
Total	$	522	$	162	$	2,937	$	3,621	$	8,384

					90 days
	30–59 Days		60–89 Days		or Greater		Total		Total
	Past Due		Past Due		Past Due		Past Due		Non-accrual
	(In thousands)
2011
Real estate:
Residential	$	92	$	247	$	1,126	$	1,465	$	1,752
Commercial		629		488		3,324		4,441		4,635
Residential construction		-		-		-		-		-
Commercial		150		-		-		150		-
Consumer & other		-		-		-		-		-
Total	$	871	$	735	$	4,450	$	6,056	$	6,387

Schedule of information pertaining to impaired loans

	At June 30, 2012						Year Ended June 30, 2012
											Interest
			Unpaid				Average		Interest		Income
	Recorded		Principal		Related		Recorded		Income		Recognized
	Investment		Balance		Allowance		Investment		Recognized		on Cash Basis
	(In thousands)
Impaired loans without a valuation allowance:
Real estate:
Residential	$	1,415	$	1,415	$	-	$	1,235	$	29	$	9
Commercial		6,668		6,754		-		3,370		97		87
Residential construction		424		424		-		426		9		9
Commercial		-		-		-		26		11		7
Consumer & other		27		27		-		43		4		-
Total impaired with no related allowance		8,534		8,620		-		5,100		150		112
Impaired loans with a valuation allowance:
Real estate:
Residential	$	3,431	$	3,527	$	185	$	2,957	$	66	$	33
Commercial		3,402		3,768		190		3,319		127		22
Total impaired with an allowance recorded		6,833		7,295		375		6,276		193		55
Total impaired loans:
Real Estate:
Residential	$	4,846	$	4,942	$	185	$	4,192	$	95	$	42
Commercial		10,070		10,522		190		6,689		224		109
Residential construction		424		424		-		426		9		9
Commercial		-		-		-		26		11		7
Consumer & other		27		27		-		43		4		-
Total impaired loans	$	15,367	$	15,915	$	375	$	11,376	$	343	$	167

											Interest
			Unpaid				Average		Interest		Income
	Recorded		Principal		Related		Recorded		Income		Recognized
	Investment		Balance		Allowance		Investment		Recognized		on Cash Basis
	(In thousands)
June 30, 2011
Impaired loans without a valuation allowance:
Real Estate:
Residential	$	395	$	393	$	-	$	1,071	$	4	$	4
Commercial		2,625		2,623		-		2,719		22		9
Residential construction		-		-		-		-		-		-
Commercial		-		-		-		-		-		-
Consumer and other		51		51		-		17		3		-
Total impaired with no related allowance		3,071		3,067		-		3,807		29		13
Impaired loans with a valuation allowance:
Real estate:
Residential	$	2,025	$	2,022	$	236	$	1,381	$	58	$	5
Commercial		5,472		5,470		686		3,787		137		49
Residential construction		-		-		-		-		-		-
Commercial		-		-		-		43		-		-
Consumer and other		6		6		6		21		-		-
Total impaired with an allowance recorded		7,503		7,498		928		5,232		195		54
Total impaired loans:
Real estate:
Residential	$	2,420	$	2,415	$	236	$	2,452	$	62	$	9
Commercial		8,097		8,093		686		6,506		159		58
Residential construction		-		-		-		-		-		-
Commercial		-		-		-		43		-		-
Consumer and other		57		57		6		38		3		-
Total impaired loans	$	10,574	$	10,565	$	928	$	9,039	$	224	$	67

Schedule of modifications that were deemed to be troubled debt restructures

			Pre-Modification		Post-Modification
			Outstanding		Outstanding
	Number of		Recorded		Recorded
	Contracts		Investment		Investment
	(Dollars in thousands)
Real estate:
Residential		11	$	1,882	$	1,883
Commercial		16		2,224		2,227
		27	$	4,106	$	4,110

Schedule of the summary of troubled debt restructurings that have subsequently defaulted within one year of modification

	Number of		Recorded
	Contracts		Investment
	(Dollars in thousands)
Real estate:
Residential		2	$	229
Commercial		1		224
		3	$	453

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Investment Securities (Tables)

12 Months Ended

Jun. 30, 2012

Investments, Debt and Equity Securities [Abstract]

Schedule of carrying value and estimated market values of investment securities by maturity

	Amortized		Gross Unrealized					Fair
	Cost Basis		Gain		(Loss)			Value
	(In thousands)
June 30, 2012:
Available-for-sale:
Debt securities:
U.S. government and government-sponsored securities:
Due within one year	$	450	$	9	$	-		$	459
Corporate bonds and other securities:
After ten years		5,998		-		(1,344	)		4,654
U.S. Government-sponsored and guaranteed mortgage-backed securities:
Due in one year or less		1		-		-			1
From one through five years		416		24		-			440
From five through ten years		2,564		140		-			2,704
After ten years		19,717		1,265		(14	)		20,968
		22,698		1,429		(14	)		24,113
Non-agency mortgage-backed securities:
After ten years		9,601		-		(1,250	)		8,351
Total debt securities		38,747		1,438		(2,608	)		37,577
Equity securities:
Auction rate preferred		10,000		11		(375	)		9,636
Total available-for-sale securities	$	48,747	$	1,449	$	(2,983	)	$	47,213
June 30, 2011:
Available-for-sale:
Debt securities:
U.S. government and agency obligations:
From one through five years	$	630	$	36	$	-		$	666
Corporate bonds and other obligations:
After ten years		5,998		-		(1,093	)		4,905
Mortgage-backed securities		43,253		1,673		(2,888	)		42,038
Equity securities:
Auction rate preferred		10,047		682		(329	)		10,400
Total available-for-sale securities	$	59,928	$	2,391	$	(4,310	)	$	58,009

	Amortized		Gross Unrealized					Fair
	Cost Basis		Gain		(Loss)			Value
	(In thousands)
June 30, 2012:
Held-to-maturity:
U.S. Government and government-sponsored securities:
From one through five years	$	5,996	$	34	$	-		$	6,030
From five through ten years		3,196		149		(7	)		3,338
		9,192		183		(7	)		9,368
U.S. Government-sponsored and guaranteed mortgage-backed securities:
From five through ten years		6,767		192		-			6,959
After ten years		89,236		2,783		(10	)		92,009
		96,003		2,975		(10	)		98,968
Total held to maturity securities	$	105,195	$	3,158	$	(17	)	$	108,336
June 30, 2011:
Held-to-maturity:
U.S. Government and government-sponsored securities:
From one through five years	$	2,000	$	34	$	-		$	2,034
From five through ten years		11,234		51		(26	)		11,259
After ten years		2,851		-		(15	)		2,836
		16,085		85		(41	)		16,129
Mortgage-backed securities		98,656		1,221		(44	)		99,833
Total held to maturity securities	$	114,741	$	1,306	$	(85	)	$	115,962

Schedule of significant assumptions used in the valuation of non-agency mortgage-backed securities

	Amortized		Fair
Issuer	Cost		Value
	(In thousands)
Merrill Lynch Auction Rate Pass Thru	$	5,000	$	4,868

Schedule of the estimated fair value and related unrealized losses segregated by category and length of time that individual securities have been in a continuous unrealized loss position

	Less than 12 Months				12 Months or More				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Loss		Value		Loss		Value		Loss
					(In thousands)
June 30, 2012:
Available-for-sale:
Debt securities:
Corporate bonds and other securities	$	-	$	-	$	4,654	$	1,344	$	4,654	$	1,344
U.S. Government sponsored and guaranteed mortgage-backed securities		1,826		14		-		-		1,826		14
Equity securities		7,625		375		-		-		7,625		375
Total temporarily impaired securities		9,451		389		4,654		1,344		14,105		1,733
Held-to-maturity:
U.S. Government and government-sponsored securities		2,257		7		-		-		2,257		7
U.S. Government-sponsored and guaranteed mortgage-backed securities		10,141		10		-		-		10,141		10
Total temporarily impaired held-to-maturity		12,398		17		-		-		12,398		17
Other-than-temporarily impaired debt securities: (1)
Non-agency mortgage-backed securities		1,767		21		6,512		1,229		8,279		1,250
Total temporarily impaired and other-than-temporarily impaired securities	$	23,616	$	427	$	11,166	$	2,573	$	34,782	$	3,000
	Less than 12 Months				12 Months or More				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Loss		Value		Loss		Value		Loss
					(In thousands)
June 30, 2011:
U.S. Government and agency securities	$	3,810	$	41	$	-	$	-	$	3,810	$	41
Corporate bonds and other obligations		-		-		4,905		1,093		4,905		1,093
Mortgage-backed securities		10,323		45		-		-		10,323		45
Equity securities		-		-		6,671		329		6,671		329
Total temporarily impaired securities		14,133		86		11,576		1,422		25,709		1,508
Other-than-temporarily impaired debt securities: (1)
Mortgage-backed securities		4,567		537		7,155		2,350		11,722		2,887
Total temporarily impaired and other-than-temporarily impaired securities	$	18,700	$	623	$	18,731	$	3,772	$	37,431	$	4,395

(1)Includes other-than-temporary impaired available-for-sale debt securities in which a portion of the other-than-temporary impairment loss remains in accumulated other comprehensive loss.

Schedule of other-than-temporary impairment losses on securities

	Equity Securities		Corporate Securities		Non-Agency Mortgage- Backed Securities		Total
	(In Thousands)
June 30, 2012:
Total other-than-temporary impairment losses	$	-	$	-	$	3,522	$	3,522
Less: unrealized other-than-temporary losses recognized in accumulated other comprehensive income/loss (1)		-		-		1,558		1,558
Net impairment losses recognized in earnings (2)	$	-	$	-	$	1,964	$	1,964
June 30, 2011
Total other-than-temporary impairment losses	$	-	$	-	$	3,037	$	3,037
Less: unrealized other-than-temporary losses recognized in other comprehensive loss (1)		-		-		1,972		1,972
Net impairment losses recognized in earnings (2)	$	-	$	-	$	1,065	$	1,065

(1) Represents the non-credit component of the other-than-temporary impairment.

(2) Represents the credit component of the other-than-temporary impairment.

Schedule of the amount of credit losses on debt securities for which a portion of an other-than-temporary impairment was recognized in other comprehensive income

Balance as of June 30, 2010	$	12,242
Credit losses on securities for which other-than-temporary impairment was not previously recorded		3
Additional credit losses on securities for which an other-than-temporary impairment charge was previously recorded		1,062
Reductions for securities sold during the period		-
Balance as of June 30, 2011		13,307
Credit losses on securities for which other-than-temporary impairment was not previously recorded		-
Additional credit losses on securities for which an other-than-temporary impairment charge was previously recorded		1,964
Reductions for securities sold during the period		-
Balance as of June 30, 2012	$	15,271

Schedule of significant assumptions used in the valuation of non-agency mortgage-backed securities

	Weighted			Range
	Average			Minimum		Maximum
Prepayment rates		18.2	%		0.0%		31.1%
Default rates		21.5	%		5.6%		32.8%
Loss severity		33.0	%		10.0%		37.9%

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LOANS - Summary of allowance for loan losses by portfolio segment (Details 2) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Jun. 30, 2012		Jun. 30, 2011
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Provision	$ 1,152		$ 915
Loans receivables
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance for loan losses, Beginning balance	3,072		2,651
Charge-offs	(1,352)		554
Recoveries	41		60
Provision	1,152		915
Allowance for loan losses, Ending balance	2,913		3,072
Ending balance: Individually evaluated for impairment			928
Ending balance: Collectively evaluated for impairment			2,144
Loans Receivable, Net [Abstract]
Loans: Ending balance	251,022	[1]	256,106
Financing Receivable, Individually Evaluated for Impairment			10,565
Financing Receivable, Collectively Evaluated for Impairment			245,541
Loans receivables | Residential Real Estate
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance for loan losses, Beginning balance	1,520		1,332
Charge-offs	(364)		208
Recoveries	7		6
Provision	322		390
Allowance for loan losses, Ending balance	1,485		1,520
Ending balance: Individually evaluated for impairment			236
Ending balance: Collectively evaluated for impairment			1,284
Loans Receivable, Net [Abstract]
Loans: Ending balance	200,148		193,084
Financing Receivable, Individually Evaluated for Impairment			2,415
Financing Receivable, Collectively Evaluated for Impairment			190,669
Loans receivables | Commercial Real Estate
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance for loan losses, Beginning balance	1,286		901
Charge-offs	(928)		62
Recoveries
Provision	989		447
Allowance for loan losses, Ending balance	1,347		1,286
Ending balance: Individually evaluated for impairment			686
Ending balance: Collectively evaluated for impairment			600
Loans Receivable, Net [Abstract]
Loans: Ending balance	44,218		52,686
Financing Receivable, Individually Evaluated for Impairment			8,093
Financing Receivable, Collectively Evaluated for Impairment			44,593
Loans receivables | Residential construction
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance for loan losses, Beginning balance	28		10
Charge-offs
Recoveries
Provision	(8)		18
Allowance for loan losses, Ending balance	20		28
Ending balance: Individually evaluated for impairment
Ending balance: Collectively evaluated for impairment			28
Loans Receivable, Net [Abstract]
Loans: Ending balance	2,299		1,910
Financing Receivable, Individually Evaluated for Impairment
Financing Receivable, Collectively Evaluated for Impairment			1,910
Loans receivables | Commercial
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance for loan losses, Beginning balance	140		297
Charge-offs			212
Recoveries	11		18
Provision	(134)		37
Allowance for loan losses, Ending balance	17		140
Ending balance: Individually evaluated for impairment
Ending balance: Collectively evaluated for impairment			140
Loans Receivable, Net [Abstract]
Loans: Ending balance	3,459		7,356
Financing Receivable, Individually Evaluated for Impairment
Financing Receivable, Collectively Evaluated for Impairment			7,356
Loans receivables | Consumer and other
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance for loan losses, Beginning balance	11		43
Charge-offs	(60)		72
Recoveries	23		36
Provision	63		4
Allowance for loan losses, Ending balance	37		11
Ending balance: Individually evaluated for impairment			6
Ending balance: Collectively evaluated for impairment			5
Loans Receivable, Net [Abstract]
Loans: Ending balance	898		1,070
Financing Receivable, Individually Evaluated for Impairment			57
Financing Receivable, Collectively Evaluated for Impairment			1,013
Loans receivables | Unallocated
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance for loan losses, Beginning balance	87		68
Charge-offs
Recoveries
Provision	(80)		19
Allowance for loan losses, Ending balance	7		87
Ending balance: Individually evaluated for impairment
Ending balance: Collectively evaluated for impairment			87
Loans Receivable, Net [Abstract]
Loans: Ending balance
Financing Receivable, Individually Evaluated for Impairment
Financing Receivable, Collectively Evaluated for Impairment
Impaired loan receivables
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance for loan losses, Ending balance	375
Loans Receivable, Net [Abstract]
Loans: Ending balance	15,367
Impaired loan receivables | Residential Real Estate
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance for loan losses, Ending balance	185
Loans Receivable, Net [Abstract]
Loans: Ending balance	4,846
Impaired loan receivables | Commercial Real Estate
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance for loan losses, Ending balance	190
Loans Receivable, Net [Abstract]
Loans: Ending balance	10,070
Impaired loan receivables | Residential construction
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance for loan losses, Ending balance
Loans Receivable, Net [Abstract]
Loans: Ending balance	424
Impaired loan receivables | Commercial
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance for loan losses, Ending balance
Loans Receivable, Net [Abstract]
Loans: Ending balance
Impaired loan receivables | Consumer and other
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance for loan losses, Ending balance
Loans Receivable, Net [Abstract]
Loans: Ending balance	27
Impaired loan receivables | Unallocated
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance for loan losses, Ending balance
Loans Receivable, Net [Abstract]
Loans: Ending balance
Non-impaired loan receivables
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance for loan losses, Ending balance	2,538
Loans Receivable, Net [Abstract]
Loans: Ending balance	235,655
Non-impaired loan receivables | Residential Real Estate
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance for loan losses, Ending balance	1,300
Loans Receivable, Net [Abstract]
Loans: Ending balance	195,302
Non-impaired loan receivables | Commercial Real Estate
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance for loan losses, Ending balance	1,157
Loans Receivable, Net [Abstract]
Loans: Ending balance	34,148
Non-impaired loan receivables | Residential construction
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance for loan losses, Ending balance	20
Loans Receivable, Net [Abstract]
Loans: Ending balance	1,875
Non-impaired loan receivables | Commercial
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance for loan losses, Ending balance	17
Loans Receivable, Net [Abstract]
Loans: Ending balance	3,459
Non-impaired loan receivables | Consumer and other
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance for loan losses, Ending balance	37
Loans Receivable, Net [Abstract]
Loans: Ending balance	871
Non-impaired loan receivables | Unallocated
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance for loan losses, Ending balance	7
Loans Receivable, Net [Abstract]
Loans: Ending balance

[1] Does not include deferred fees or costs.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1) (USD $)	12 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Accounting Policies [Abstract]
Cash and due from banks subject to withdrawals and usage restrictions	$ 5,650,000	$ 5,650,000
Allocated Share-based Compensation Expense	$ 24,000	$ 121,000
Period for dividends payable on common stock	20 years

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PREMISES AND EQUIPMENT (Tables)

12 Months Ended

Jun. 30, 2012

Property, Plant and Equipment [Abstract]

Schedule of summary of premises and equipment

	2012			2011
	(In thousands)
Land	$	470		$	470
Buildings		6,270			6,266
Equipment		2,770			2,769
		9,510			9,505
Accumulated depreciation and amortization		(4,984	)		(4,656	)
Premises and equipment, net	$	4,526		$	4,849

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GOODWILL AND INTANGIBLE ASSETS (Tables)

12 Months Ended

Jun. 30, 2012

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of goodwill

	June 30,
	2012		2011
	(In thousands)
Balances not subject to amortization:
Goodwill	$	6,912	$	6,912
Balances subject to amortization:
Core deposit intangible		202		324
Total intangible assets	$	7,114	$	7,236

Schedule of expected future amortization expense

	Years
	Ending
	June 30,
	(In thousands)
2013	$	93
2014		65
2015		36
2016		8
Total	$	202

Schedule of gross carrying amount of core deposits intangibles

	2012
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
	(In thousands)
Core deposit intangible	$	1,553	$	1,351	$	202
	2011
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
	(In thousands)
Core deposit intangible	$	1,553	$	1,229	$	324

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Consolidated Statements of Changes in Stockholders' Equity (Concluded) (Parentheticals) (USD $)	12 Months Ended
	Jun. 30, 2012
Statement Of Stockholders' Equity [Abstract]
Accumulated other comprehensive loss in net unrealized losses on securities available-for-sale, net of tax effects	$ 1,534,000
Tax effects of net unrealized holding loss on available-for-sale securities	$ 521,000

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DEPOSITS (Tables)

12 Months Ended

Jun. 30, 2012

Deposit Liabilities [Abstract]

Schedule of the balances and the rates at which the company paid interest on deposit accounts and maturity period of Certificate accounts

	2012					2011
	Amount		Weighted Average Rate			Amount		Weighted Average Rate
	(Dollars in thousands)
Demand deposits	$	43,785		-	%	$	36,814		-	%
NOW accounts		92,662		0.67			92,273		0.81
Regular savings		54,495		0.21			50,283		0.34
Money market accounts		16,668		0.48			13,474		0.68
Club accounts		256		0.15			245		0.30
		207,866		0.39			193,089		0.52
Certificate accounts maturing in:
Less than one year		60,699		1.28			71,200		1.84
One to two years		30,251		2.64			24,112		2.43
Two to three years		18,439		2.59			22,182		3.25
Three to five years		25,083		2.29			23,190		2.91
		134,472		1.96			140,684		2.34
Total deposits	$	342,338		1.01	%	$	333,773		1.29	%

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FAIR VALUE MEASUREMENTS - Assets measured at fair value on a non-recurring basis and the adjustments to the carrying value (Details 2) (Fair value measurements non recurring basis, USD $) In Thousands, unless otherwise specified	12 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total losses	$ 56	$ 95
Total Fair Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value	247	7,649
Quoted Prices in Active Markets for Identical Assets Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value
Significant Other Observable Inputs Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value		343
Significant Unobservable Inputs Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value	247	7,306
Other real estate owned
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total losses		95
Other real estate owned | Total Fair Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value	247	1,074
Other real estate owned | Quoted Prices in Active Markets for Identical Assets Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value
Other real estate owned | Significant Other Observable Inputs Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value		343
Other real estate owned | Significant Unobservable Inputs Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value	247	731
Impaired loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total losses
Impaired loans | Total Fair Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value		6,575
Impaired loans | Quoted Prices in Active Markets for Identical Assets Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value
Impaired loans | Significant Other Observable Inputs Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value
Impaired loans | Significant Unobservable Inputs Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value		$ 6,575

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PARENT COMPANY ONLY FINANCIAL STATEMENTS (Tables)

12 Months Ended

Jun. 30, 2012

Condensed Financial Information Of Parent Company Only Disclosure [Abstract]

Balance Sheets

Balance Sheets

June 30, 2012 and 2011

(In thousands)

	June 30,
	2012		2011
ASSETS
Cash and due from depository institutions	$	556	$	434
Investment in Putnam Bank		44,150		42,765
Investment in available-for-sale securities (at fair value)		169		225
Investment in held-to-maturity securities (fair value of $1,003)		1,000		1,000
Loan to ESOP		1,863		1,985
Other assets		421		379
Total assets	$	48,159	$	46,788
LIABILITIES AND STOCKHOLDERS’ EQUITY
Other liabilities	$	24	$	41
Stockholders’ equity		48,135		46,747
Total liabilities and stockholders’ equity	$	48,159	$	46,788

Statements of Income

Statements of Income

For the Years Ended June 30, 2012 and 2011

(In thousands)

	2012			2011
Interest and dividends on investments	$	20		$	26
Interest on loan		63			67
Total interest and dividend income		83			93
Interest expense		-			-
Net interest and dividend income		83			93
Other expense		220			183
Loss before income tax (benefit) expense and equity in undistributed net income of subsidiary		(137	)		(90	)
Income tax (benefit) expense		(56	)		71
Loss before equity in undistributed net income of subsidiary		(81	)		(161	)
Equity in undistributed net income of subsidiary		1,131			1,259
Net income	$	1,050		$	1,098

Statements of Cash Flows

Statements of Cash Flows

June 30, 2012 and 2011

(In thousands)

	2012			2011
Cash flows from operating activities
Net income
Adjustments to reconcile net income to net cash provided by operating activities:	$	1,050		$	1,098
Amortization of securities, net		1			-
Amortization of ESOP expense		60			57
(Increase) decrease in other assets		(42	)		60
(Increase) decrease in due from subsidiary		(4	)		176
Increase in due to subsidiary		(6	)		-
Decrease in other liabilities		(10	)		(118	)
Stock-based compensation expense		27			234
Undistributed net income of subsidiary		(1,131	)		(1,259	)
Net cash (used in) provided by operating activities		(55	)		248
Cash flows from investing activities:
Proceeds from maturities of available-for-sale securities		55			1,030
Purchase of held-to-maturity securities		-			(1,000	)
Principal payments received on loan to ESOP		122			118
Net cash provided by investing activities		177			148
Net cash provided by financing activities		-			-
Net increase in cash and cash equivalents		122			396
Cash and cash equivalents at beginning of year		434			38
Cash and cash equivalents at end of year	$	556		$	434

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INVESTMENT SECURITIES (Details Textuals 1) (Auction rate preferred stock, USD $)	12 Months Ended
	Jun. 30, 2012 Securities	Jun. 30, 2011
Auction rate preferred stock
Schedule Of Available-For-Sale Securities and Held-To-Maturity Securities [Line Items]
Available-for-sale securities equity securities fair value	$ 9,636,000	$ 10,400,000
Number of days to reset dividend rate based on auction process	90 days	90 days
Number of auction-rate trust preferred securities	2

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BORROWED FUNDS - Summary of borrowed funds (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Jun. 30, 2011
Short-term borrowing
Securities sold under agreements to repurchase	$ 3,653	$ 4,244
Short-term Debt	$ 3,653	$ 4,244
Weighted Average Rate, Securities sold under agreements to repurchase	0.17%	0.27%
Weighted Average Rate, Short-term borrowing	0.17%	0.27%

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Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Jun. 30, 2011
ASSETS
Cash and due from depository institutions	$ 5,228	$ 7,915
Interest-bearing deposits with other banks	6,185	358
Cash and cash equivalents	11,413	8,273
Investment in available-for-sale securities (at fair value)	47,213	58,009
Investments in held-to-maturity securities (fair value of $108,336 as of June 30, 2012 and $115,962 as of June 30, 2011)	105,195	114,741
Federal Home Loan Bank stock, at cost	7,536	8,056
Loans held-for-sale	776	1,567
Loans	251,485	256,297
Allowance for loan losses	(2,913)	(3,072)
Net loans	248,572	253,225
Premises and equipment	4,526	4,849
Accrued interest receivable	1,158	1,528
Other real estate owned	1,683	1,074
Goodwill	6,912	6,912
Intangible assets	202	324
Bank-owned life insurance	8,759	6,431
Due from broker	2,000
Deferred tax asset	3,890	4,216
Other assets	2,508	3,294
Total assets	452,343	472,499
Deposits:
Noninterest-bearing	43,785	36,814
Interest-bearing	298,553	296,959
Total deposits	342,338	333,773
Mortgagors' escrow accounts	2,034	1,766
Federal Home Loan Bank advances	53,500	83,500
Securities sold under agreements to repurchase	3,653	4,244
Other liabilities	2,683	2,469
Total liabilities	404,208	425,752
Commitments and Contingencies (Notes 10 and 12)
Stockholders' equity:
Preferred stock, $0.10 par value, 1,000,000 shares authorized, no shares issued and outstanding
Common stock, $0.10 par value, 12,000,000 shares authorized, 6,943,125 shares issued, 6,528,863 shares outstanding at June 30, 2012 and 2011	694	694
Additional paid-in capital	30,602	30,594
Retained earnings	23,630	22,648
Accumulated other comprehensive loss	(1,013)	(1,267)
Unearned ESOP shares	(1,565)	(1,693)
Unearned stock awards		(16)
Treasury stock, at cost (414,262 shares at June 30, 2012 and 2011)	(4,213)	(4,213)
Total stockholders' equity	48,135	46,747
Total liabilities and stockholders' equity	$ 452,343	$ 472,499

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2)	12 Months Ended
	Jun. 30, 2012
Buildings and premises
Property, Plant and Equipment [Line Items]
Estimated lives	5 to 40 years
Furniture, fixtures and equipment
Property, Plant and Equipment [Line Items]
Estimated lives	3 to 20 years
lease
Property, Plant and Equipment [Line Items]
Estimated lives	1 to 25 years

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PARENT COMPANY ONLY FINANCIAL STATEMENTS - Statements of Cash Flows (Details 2) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Cash flows from operating activities:
Net income	$ 1,050	$ 1,098
Adjustments to reconcile net income to net cash provided by operating activities:
Amortization of securities, net	(1,309)	(1,197)
Amortization of ESOP expense	60	57
Decrease in other liabilities	214	288
Stock-based compensation expense	24	120
Net cash (used in) provided by operating activities	8,320	7,144
Cash flows from investing activities:
Proceeds from maturities of available-for-sale securities	14,922	29,299
Purchase of held-to-maturity securities	32,483	93,692
Net cash provided by investing activities	16,578	(2,276)
Net cash provided by financing activities	(21,758)	(19,886)
Net increase in cash and cash equivalents	3,140	(15,018)
Cash and cash equivalents at beginning of year	8,273	23,291
Cash and cash equivalents at end of year	11,413	8,273
PSB Holdings, Inc.
Cash flows from operating activities:
Net income	1,050	1,098
Adjustments to reconcile net income to net cash provided by operating activities:
Amortization of securities, net	1
Amortization of ESOP expense	60	57
(Increase) decrease in other assets	(42)	60
(Increase) decrease in due from subsidiary	(4)	176
Increase in due to subsidiary	(6)
Decrease in other liabilities	(10)	(118)
Stock-based compensation expense	27	234
Undistributed net income of subsidiary	(1,131)	(1,259)
Net cash (used in) provided by operating activities	(55)	248
Cash flows from investing activities:
Proceeds from maturities of available-for-sale securities	55	1,030
Purchase of held-to-maturity securities		(1,000)
Principal payments received on loan to ESOP	122	118
Net cash provided by investing activities	177	148
Net cash provided by financing activities
Net increase in cash and cash equivalents	122	396
Cash and cash equivalents at beginning of year	434	38
Cash and cash equivalents at end of year	$ 556	$ 434

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Consolidated Statements of Changes in Stockholders' Equity (Parentheticals) (USD $)	12 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Statement Of Stockholders' Equity [Abstract]
Pre-tax unrealized losses in which other-than-temporary impairment recognized	$ 1,250,000	$ 2,887,000

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PARENT COMPANY ONLY FINANCIAL STATEMENTS - Balance Sheets (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2010
Condensed Financial Statements, Captions [Line Items]
Cash and due from depository institutions	$ 5,228	$ 7,915
Investment in available-for-sale securities (at fair value)	47,213	58,009
Investment in held-to-maturity securities (fair value of $1,003)	105,195	114,741
Other assets	2,508	3,294
Total assets	452,343	472,499
LIABILITIES AND STOCKHOLDERS' EQUITY
Other liabilities	2,683	2,469
Stockholders' equity	48,135	46,747	43,855
Total liabilities and stockholders' equity	452,343	472,499
PSB Holdings, Inc.
Condensed Financial Statements, Captions [Line Items]
Cash and due from depository institutions	556	434
Investment in Putnam Bank	44,150	42,765
Investment in available-for-sale securities (at fair value)	169	225
Investment in held-to-maturity securities (fair value of $1,003)	1,000	1,000
Loan to ESOP	1,863	1,985
Other assets	421	379
Total assets	48,159	46,788
LIABILITIES AND STOCKHOLDERS' EQUITY
Other liabilities	24	41
Stockholders' equity	48,135	46,747
Total liabilities and stockholders' equity	$ 48,159	$ 46,788

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LOANS - Summary of impaired loans (Details 5) (Loans receivables, USD $) In Thousands, unless otherwise specified	12 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Financing Receivable, Impaired [Line Items]
Impaired loans without a valuation allowance, recorded investment	$ 8,534	$ 3,071
Impaired loans without a valuation allowance, unpaid principal balance	8,620	3,067
Impaired loans without a valuation allowance, average recorded investment	5,100	3,807
Impaired loans without a valuation allowance, interest income recognized	150	29
Impaired loans without a valuation allowance, interest income recognized on cash basis	112	13
Impaired loans with a valuation allowance, recorded investment	6,833	7,503
Impaired loans with a valuation allowance, unpaid principal balance	7,295	7,498
Impaired loans with a valuation allowance, related allowance	375	928
Impaired loans with a valuation allowance, average recorded investment	6,276	5,232
Impaired loans with a valuation allowance, interest income recognized	193	195
Impaired loans with a valuation allowance, interest iIncome recognized on cash basis	55	54
Total impaired loans, recorded investment	15,367	10,574
Total impaired loans, unpaid principal balance	15,915	10,565
Impaired loans with a valuation allowance, related allowance	375	928
Total impaired loans, avegare recorded investment	11,376	9,039
Impaired Financing Receivable, Interest Income, Accrual Method	343	224
Impaired Financing Receivable, Interest Income, Cash Basis Method	167	67
Residential Real Estate
Financing Receivable, Impaired [Line Items]
Impaired loans without a valuation allowance, recorded investment	1,415	395
Impaired loans without a valuation allowance, unpaid principal balance	1,415	393
Impaired loans without a valuation allowance, average recorded investment	1,235	1,071
Impaired loans without a valuation allowance, interest income recognized	29	4
Impaired loans without a valuation allowance, interest income recognized on cash basis	9	4
Impaired loans with a valuation allowance, recorded investment	3,431	2,025
Impaired loans with a valuation allowance, unpaid principal balance	3,527	2,022
Impaired loans with a valuation allowance, related allowance	185	236
Impaired loans with a valuation allowance, average recorded investment	2,957	1,381
Impaired loans with a valuation allowance, interest income recognized	66	58
Impaired loans with a valuation allowance, interest iIncome recognized on cash basis	33	5
Total impaired loans, recorded investment	4,846	2,420
Total impaired loans, unpaid principal balance	4,942	2,415
Impaired loans with a valuation allowance, related allowance	185	236
Total impaired loans, avegare recorded investment	4,192	2,452
Impaired Financing Receivable, Interest Income, Accrual Method	95	62
Impaired Financing Receivable, Interest Income, Cash Basis Method	42	9
Commercial Real Estate
Financing Receivable, Impaired [Line Items]
Impaired loans without a valuation allowance, recorded investment	6,668	2,625
Impaired loans without a valuation allowance, unpaid principal balance	6,754	2,623
Impaired loans without a valuation allowance, average recorded investment	3,370	2,719
Impaired loans without a valuation allowance, interest income recognized	97	22
Impaired loans without a valuation allowance, interest income recognized on cash basis	87	9
Impaired loans with a valuation allowance, recorded investment	3,402	5,472
Impaired loans with a valuation allowance, unpaid principal balance	3,768	5,470
Impaired loans with a valuation allowance, related allowance	190	686
Impaired loans with a valuation allowance, average recorded investment	3,319	3,787
Impaired loans with a valuation allowance, interest income recognized	127	137
Impaired loans with a valuation allowance, interest iIncome recognized on cash basis	22	49
Total impaired loans, recorded investment	10,070	8,097
Total impaired loans, unpaid principal balance	10,522	8,093
Impaired loans with a valuation allowance, related allowance	190	686
Total impaired loans, avegare recorded investment	6,689	6,506
Impaired Financing Receivable, Interest Income, Accrual Method	224	159
Impaired Financing Receivable, Interest Income, Cash Basis Method	109	58
Residential construction
Financing Receivable, Impaired [Line Items]
Impaired loans without a valuation allowance, recorded investment	424
Impaired loans without a valuation allowance, unpaid principal balance	424
Impaired loans without a valuation allowance, average recorded investment	426
Impaired loans without a valuation allowance, interest income recognized	9
Impaired loans without a valuation allowance, interest income recognized on cash basis	9
Impaired loans with a valuation allowance, recorded investment
Impaired loans with a valuation allowance, unpaid principal balance
Impaired loans with a valuation allowance, related allowance
Impaired loans with a valuation allowance, average recorded investment
Impaired loans with a valuation allowance, interest income recognized
Impaired loans with a valuation allowance, interest iIncome recognized on cash basis
Total impaired loans, recorded investment	424
Total impaired loans, unpaid principal balance	424
Impaired loans with a valuation allowance, related allowance
Total impaired loans, avegare recorded investment	426
Impaired Financing Receivable, Interest Income, Accrual Method	9
Impaired Financing Receivable, Interest Income, Cash Basis Method	9
Commercial
Financing Receivable, Impaired [Line Items]
Impaired loans without a valuation allowance, recorded investment
Impaired loans without a valuation allowance, unpaid principal balance
Impaired loans without a valuation allowance, average recorded investment	26
Impaired loans without a valuation allowance, interest income recognized	11
Impaired loans without a valuation allowance, interest income recognized on cash basis	7
Impaired loans with a valuation allowance, recorded investment
Impaired loans with a valuation allowance, unpaid principal balance
Impaired loans with a valuation allowance, related allowance
Impaired loans with a valuation allowance, average recorded investment		43
Impaired loans with a valuation allowance, interest income recognized
Impaired loans with a valuation allowance, interest iIncome recognized on cash basis
Total impaired loans, recorded investment
Total impaired loans, unpaid principal balance
Impaired loans with a valuation allowance, related allowance
Total impaired loans, avegare recorded investment	26	43
Impaired Financing Receivable, Interest Income, Accrual Method	11
Impaired Financing Receivable, Interest Income, Cash Basis Method	7
Consumer and other
Financing Receivable, Impaired [Line Items]
Impaired loans without a valuation allowance, recorded investment	27	51
Impaired loans without a valuation allowance, unpaid principal balance	27	51
Impaired loans without a valuation allowance, average recorded investment	43	17
Impaired loans without a valuation allowance, interest income recognized	4	3
Impaired loans without a valuation allowance, interest income recognized on cash basis
Impaired loans with a valuation allowance, recorded investment		6
Impaired loans with a valuation allowance, unpaid principal balance		6
Impaired loans with a valuation allowance, related allowance		6
Impaired loans with a valuation allowance, average recorded investment		21
Impaired loans with a valuation allowance, interest income recognized
Impaired loans with a valuation allowance, interest iIncome recognized on cash basis
Total impaired loans, recorded investment	27	57
Total impaired loans, unpaid principal balance	27	57
Impaired loans with a valuation allowance, related allowance		6
Total impaired loans, avegare recorded investment	43	38
Impaired Financing Receivable, Interest Income, Accrual Method	4	3
Impaired Financing Receivable, Interest Income, Cash Basis Method

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COMMITMENTS AND CONTINGENT LIABILITIES (Tables)

12 Months Ended

Jun. 30, 2012

Commitments and Contingencies Disclosure [Abstract]

Schedule of the total minimum rental due in future periods under the existing agreements

	Rental
	Expense Due
	(In thousands)
2013	$	154
2014		150
2015		98
2016		51
2017		8
Thereafter		-
Total	$	461

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PREMISES AND EQUIPMENT (Details Textuals) (USD $)	12 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Property, Plant and Equipment [Abstract]
Depreciation expense	$ 393,000	$ 496,000

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REGULATORY MATTERS

12 Months Ended

Jun. 30, 2012

Commitments and Contingencies Disclosure [Abstract]

REGULATORY MATTERS

13. REGULATORY MATTERS

The Company, as a federally chartered holding company, is not subject to capital requirements. The Bank is subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Bank’s consolidated financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines that involve quantitative measures of the Bank’s assets, liabilities and certain off-balance-sheet items as calculated under regulatory accounting practices. The Bank’s capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings and other factors.

Quantitative measures established by regulation to ensure capital adequacy require the Bank to maintain minimum amounts and ratios (set forth in the table below) of total and Tier 1 capital (as defined in the regulations) to risk-weighted assets (as defined), of Core capital (as defined) to adjusted tangible assets (as defined) and Tangible capital (as defined) to Tangible assets (as defined). Management believes, as of June 30, 2012 and 2011, that the Bank meets all capital adequacy requirements to which it is subject.

As of June 30, 2012, the most recent notification from the Office of the Comptroller of the Currency (“OCC”) categorized the Bank as well capitalized under the regulatory framework for prompt corrective action. To be categorized as well capitalized the Bank must maintain minimum total risk-based, Tier 1 risk-based, tangible equity and Core capital ratios as set forth in the table. There are no conditions or events since that notification that management believes have changed the institution’s category.

The Bank’s actual capital amounts and ratios as of June 30, 2012 and 2011 are also presented in the table:

	Actual					For Capital Adequacy Purposes					To Be Well Capitalized Under Prompt Corrective Action Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio
	(In thousands)
As of June 30, 2012:
Tangible Equity Capital (to Tangible Assets)	$	36,587		8.24	%	$	6,661		1.50	%		N/A		N/A
Tier 1 Capital (to Adjusted Total Assets)		36,587		8.24	%		17,763		4.00	%	$	22,204		5.00	%
Tier 1 Capital (to Risk-Weighted Assets)		36,587		15.15	%		9,661		4.00	%		14,491		6.00	%
Total Capital (to Risk-Weighted Assets)		39,523		16.36	%		19,322		8.00	%		24,152		10.00	%
As of June 30, 2011:
Tangible Equity Capital (to Tangible Assets)	$	35,673		7.68	%	$	6,967		1.50	%		N/A		N/A
Tier 1 Capital (to Adjusted Total Assets)		35,673		7.68	%		18,578		4.00	%	$	23,222		5.00	%
Tier 1 Capital (to Risk-Weighted Assets)		35,673		14.79	%		9,095		4.00	%		13,643		6.00	%
Total Capital (to Risk-Weighted Assets)		36,465		16.04	%		18,190		8.00	%		22,738		10.00	%

The following table provides a reconciliation of the Company’s total consolidated equity to the capital amounts for the Bank reflected in the preceding table:

	June 30,
	2012
	(In thousands)
Total consolidated equity	$	48,135
Adjustments:
Equity capital of PSB Holdings, Inc.		(3,985	)
Intangible assets		(6,279	)
Disallowed deferred tax assets		(1,938	)
Unrealized losses on available-for-sale securities		654
Tier 1 Capital		36,587
Allowance for loan losses		2,936
Total Risk-Based capital	$	39,523

The Bank’s capital under generally accepted accounting principles is reconciled as follows as of June 30:

	2011
	(In thousands)
Capital under generally accepted accounting principles	$	42,765
Intangible Assets		(6,551	)
Disallowed deferred tax assets		(1,813	)
Unrealized losses on available-for-sale securities		1,272
Tier 1 Capital		35,673
Allowance for loan losses		2,845
Deduction for low-level recourse and residual interests		(2,053	)
Total Risk-Based capital	$	36,465

The ability of the Company to pay dividends depends, in part, on the ability of the Bank to pay dividends to the Company. The Bank will not be able to declare or pay a cash dividend on, or repurchase any of its common stock, if the effect thereof would be to reduce the regulatory capital of the Bank to an amount below amounts required under OCC rules and regulations.

On June 20, 2012, the Bank entered into an agreement with the OCC (the “Agreement”). As part of the Agreement, the OCC required the Bank to take a number of specific corrective actions, and required that the Bank not undertake certain actions without obtaining prior approval of the OCC. The Agreement replaces a memorandum of understanding that Putnam Bank entered into with the Office of Thrift Supervision. Management has reviewed its obligations under the Agreement and believes it will be able to fully comply with the terms of the Agreement.

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FAIR VALUE MEASUREMENTS (Tables)

12 Months Ended

Jun. 30, 2012

Fair Value Disclosures [Abstract]

Schedule of summary assets measured at fair value on a recurring basis

	Fair Value Measurements at Reporting Date Using:
			Quoted Prices in		Significant		Significant
			Active Markets for		Other Observable		Unobservable
			Identical Assets		Inputs		Inputs
	Total		Level 1		Level 2		Level 3
	(In thousands)
June 30, 2012
Securities available-for-sale:
U. S. Government and government-sponsored securities	$	459	$	-	$	459	$	-
Corporate bonds and other securities		4,654		-		4,654		-
U.S. Government-sponsored and guaranteed mortgage-backed securities		24,113		-		24,113		-
Non-agency mortgage-backed securities		8,351		-		8,351		-
Equity securities		9,636		-		-		9,636
Total	$	47,213	$	-	$	37,577	$	9,636
	Fair Value Measurements at Reporting Date Using:
			Quoted Prices in		Significant		Significant
			Active Markets for		Other Observable		Unobservable
			Identical Assets		Inputs		Inputs
	Total		Level 1		Level 2		Level 3
	(In thousands)
June 30, 2011
Securities available-for-sale:
U. S. Government agency securities	$	666	$	-	$	666	$	-
Corporate securities		4,905		-		4,905		-
Mortgage-backed securities insured or guaranteed by U.S. Government enterprises		30,316		-		30,316		-
Non-agency mortgage-backed securities		11,722		-		11,722		-
Equity securities		10,400		-		-		10,400
Total	$	58,009	$	-	$	47,609	$	10,400

Schedule of the changes in level 3 assets measured at fair value

	Fair Value Measurements
	Using Significant Unobservable
	Inputs (Level 3)
	Available-for-sale
	Securities			Total
	(In thousands)
Beginning balance, July 1, 2010	$	8,457		$	8,457
Total gains or losses (realized/unrealized) included in other comprehensive income		1,943			1,943
Principal payments on securities		-			-
Accretion of securities, net		-			-
Transfers out of Level 3		-			-
Ending balance, June 30, 2011		10,400			10,400
Total gains or losses (realized/unrealized) included in earnings		-			-
Included in other comprehensive income		(764	)		(764	)
Principal payments on securities		-			-
Accretion of securities, net		-			-
Transfers out of Level 3		-			-
Ending balance, June 30, 2012	$	9,636		$	9,636

Schedule of assets measured at fair value on a non-recurring basis and the adjustments to the carrying value

	Fair Value Measurements at Reporting Date Using:
			Quoted Prices in		Significant		Significant		Total Losses
			Active Markets for		Other Observable		Unobservable		for the
			Identical Assets		Inputs		Inputs		Year Ended
	Total		Level 1		Level 2		Level 3		June 30, 2012
	(In thousands)
June 30, 2012
Other real estate owned	$	247	$	-	$	-	$	247	$	56
	Fair Value Measurements at Reporting Date Using:
			Quoted Prices in		Significant		Significant		Total Losses
			Active Markets for		Other Observable		Unobservable		for the
			Identical Assets		Inputs		Inputs		Year Ended
	Total		Level 1		Level 2		Level 3		June 30, 2011
	(In thousands)
June 30, 2011
Impaired loans	$	6,575	$	-	$	-	$	6,575	$	-
Other real estate owned		1,074		-		343		731		95
Totals	$	7,649	$	-	$	343	$	7,306	$	95

Schedule of estimated fair value of financial instruments which are held or issued for purposes other than trading

	2012
	Carrying Amount		Level 1		Level 2		Level 3		Fair Value
	(In thousands)
Financial assets:
Cash and cash equivalents	$	11,413	$	11,413		-		-	$	11,413
Available-for-sale securities		47,213		-		47,213		-		47,213
Held-to-maturity securities		105,195		-		108,336		-		108,336
Federal Home Loan Bank Stock		7,536		-		-		7,536		7,536
Loans held-for-sale		776		-		-		794		782
Loans, net		248,572		-		-		255,075		255,074
Accrued interest receivable		1,158		-		-		1,158		1,158
Financial liabilities:
Deposits		342,338		-		-		344,675		344,675
Mortgagors’ escrow accounts		2,034		-		-		2,034		2,034
Federal Home Loan Bank advances		53,500		-		55,340		-		55,340
Securities sold under agreements to repurchase		3,653		-		3,653		-		3,653

	2011
	Carrying Amount		Fair Value
	(In thousands)
Financial assets:
Cash and cash equivalents	$	8,273	$	8,273
Available-for-sale securities		58,009		58,009
Held-to-maturity securities		114,741		115,962
Federal Home Loan Bank Stock		8,056		8,056
Loans held-for-sale		1,567		1,583
Loans, net		253,225		257,835
Accrued interest receivable		1,528		1,528
Financial liabilities:
Deposits		333,773		331,132
Mortgagors’ escrow accounts		1,766		1,766
Federal Home Loan Bank advances		83,500		87,339
Securities sold under agreements to repurchase		4,244		4,244

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RECLASSIFICATION

12 Months Ended

Jun. 30, 2012

Equity [Abstract]

RECLASSIFICATION

15.         RECLASSIFICATION

              Certain amounts in the prior year have been reclassified to be consistent with the current year’s statement presentation.

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GOODWILL AND INTANGIBLE ASSETS - Summary of gross carrying amount of core deposits intangibles (Details 2) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Jun. 30, 2011
Acquired Finite-Lived Intangible Assets [Line Items]
Core deposit intangible	$ 202	$ 324
Core deposit intangible
Acquired Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	1,553	1,553
Accumulated amortization	$ 1,351	$ 1,229

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Consolidated Statements of Changes in Stockholders' Equity (Concluded) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Reclassification disclosure
Net unrealized holding (losses) gains on available-for-sale securities	$ (1,344)	$ 1,475
Reclassification adjustment for losses realized in income on available-for-sale securities	1,729	811
Other comprehensive income before tax	385	2,286
Income tax expense related to other comprehensive income	(131)	(777)
Other comprehensive income, net of tax	$ 254	$ 1,509

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Consolidated Balance Sheets (Parentheticals) (USD $) In Thousands, except Share data, unless otherwise specified	Jun. 30, 2012	Jun. 30, 2011
Statement Of Financial Position [Abstract]
Investments in held-to-maturity securities, fair value (in dollars)	$ 108,336	$ 115,962
Preferred stock, par value (in dollars per share)	$ 0.10	$ 0.10
Preferred stock, shares authorized	1,000,000	1,000,000
Preferred stock, shares issued
Preferred stock, shares outstanding
Common stock, par value (in dollars per share)	$ 0.10	$ 0.10
Common stock, shares authorized	12,000,000	12,000,000
Common stock, shares issued	6,943,125	6,943,125
Common stock, shares outstanding	6,528,863	6,528,863
Treasury stock, shares	414,262	414,262

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BORROWED FUNDS

12 Months Ended

Jun. 30, 2012

Debt Disclosure [Abstract]

BORROWED FUNDS

8. BORROWED FUNDS

Borrowed funds consisted of the following at June 30:

	2012					2011
	Amount Due		Weighted			Amount Due		Weighted
			Average					Average
			Rate					Rate
	(Dollars in thousands)
Short-term borrowing
Securities sold under agreements to repurchase	$	3,653		0.17	%		4,244		0.27	%
Total short-term borrowings		3,653		0.17			4,244		0.27
Long-term FHLB of Boston (FHLB) advances
Year of maturity:
2012		-		-			32,000		4.56
2013		5,000		3.23			5,000		3.23
2014		17,500		3.19			17,500		3.19
2015		1,000		3.35			1,000		3.35
2016		10,000		3.17			10,000		3.17
2017		12,000		3.89			10,000		4.15
2018		8,000		3.91			8,000		3.91
Total long-term borrowings		53,500		3.46			83,500		3.90
Total borrowed funds	$	57,153		3.25	%	$	87,744		3.72	%

As of June 30, 2012 and 2011, loans with a principal balance of $84,992,000 and $122,215,000, respectively, were specifically pledged to secure available borrowings from the FHLB. The maturity schedule above reflects final maturity; however, some are callable by the FHLB of Boston at earlier dates.

Additionally, the Bank has a line of credit with Federal Home Loan Bank of Boston in the amount of $2,354,000. No amounts were outstanding at June 30 2012, and 2011.

Securities sold under agreements to repurchase as of June 30, 2012 and 2011 consist of securities sold on a short-term basis by the Bank that have been accounted for as borrowings. The securities consist of U.S. Government agency bonds that are held in the Bank’s safekeeping account at State Street Bank and Trust under the control of the Bank and pledged to the purchasers of the securities.

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BENEFIT PLANS (Details Textuals 2) (USD $)	0 Months Ended		12 Months Ended
	Jun. 07, 2006	Nov. 07, 2005	Jun. 30, 2012	Jun. 30, 2011	May 25, 2007	Oct. 31, 2005 Stock Based Incentive Plan	Oct. 31, 2005 Stock Based Incentive Plan Stock Options	Oct. 31, 2005 Stock Based Incentive Plan Restricted Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares company may granted						476,298	340,213	136,085
Number of options to purchase common stock	18,000	319,800			29,000
Number of options to purchase restricted stock	6,000	129,281			9,500
Exercise price of option	$ 10.78	$ 10.60			$ 10.70
Term of award	10 years	10 years
Percentage of award vesting per year	20.00%	20.00%			20.00%
Share-based compensation expense in connection with the stock option and restricted stock awards			$ 24,000	$ 121,000

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BENEFIT PLANS - Summary of stock options outstanding (Details 2) (USD $)	12 Months Ended
	Jun. 30, 2012
$ 10.60
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Options Outstanding, Exercise Price	$ 10.6
Options Outstanding Number Outstanding as of 6/30/12	193,921
Options Outstanding, Weighted-Average Remaining Contractual Life	3 years 4 months 10 days
Options Outstanding, Weighted-Average Exercise Price	$ 10.60
Options Exercisable, Number Exercisable as of 6/30/12	193,921
Options Exercisable, Weighted-Average Exercise Price	$ 10.60
$ 10.70
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Options Outstanding, Exercise Price	$ 10.70
Options Outstanding Number Outstanding as of 6/30/12	23,000
Options Outstanding, Weighted-Average Remaining Contractual Life	4 years 10 months 24 days
Options Outstanding, Weighted-Average Exercise Price	$ 10.70
Options Exercisable, Number Exercisable as of 6/30/12	23,000
Options Exercisable, Weighted-Average Exercise Price	$ 10.70
$ 10.78
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Options Outstanding, Exercise Price	$ 10.78
Options Outstanding Number Outstanding as of 6/30/12	6,000
Options Outstanding, Weighted-Average Remaining Contractual Life	3 years 11 months 8 days
Options Outstanding, Weighted-Average Exercise Price	$ 10.78
Options Exercisable, Number Exercisable as of 6/30/12	6,000
Options Exercisable, Weighted-Average Exercise Price	$ 10.78

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Document and Entity Information (USD $) In Millions, except Share data, unless otherwise specified	12 Months Ended
	Jun. 30, 2012	Aug. 31, 2012	Dec. 31, 2011
Document and Entity Information [Abstract]
Entity Registrant Name	PSB Holdings, Inc.
Entity Central Index Key	0001293211
Trading Symbol	psbh
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Current Fiscal Year End Date	--06-30
Entity Filer Category	Smaller Reporting Company
Entity Well-Known Seasoned Issuer	No
Entity Common Stock, Shares Outstanding		6,528,863
Entity Public Float			$ 7.9
Document Type	10-K
Document Period End Date	Jun. 30, 2012
Amendment Flag	false
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	FY

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INCOME TAXES

12 Months Ended

Jun. 30, 2012

Income Tax Disclosure [Abstract]

INCOME TAXES

9. INCOME TAXES

The following are components of income tax expense (benefit) for the fiscal years ended June 30:

	2012		2011
	(In thousands)
Current:
Federal	$	18	$	723
State		2		1
Total current		20		724
Deferred:
Federal		195		(187	)
State		-		-
Total deferred		195		(187	)
Income tax expense	$	215	$	537

Deferred income taxes reflect the impact of “temporary differences” between the amount of assets and liabilities for financial reporting purposes and such amounts as measured by tax laws and regulations.

The Bank established Putnam Bank Mortgage Servicing Company during the year ended June 30, 2007. The subsidiary qualifies and operates as a Connecticut passive investment company pursuant to legislation. Because the subsidiary earns sufficient income from passive investments and its dividends to the parent are exempt from Connecticut Corporation Business Tax, the subsidiary Bank no longer expects to incur Connecticut income tax expense or to recognize its Connecticut deferred tax asset. The Parent company is still subject to the Connecticut Corporation Business Tax.

The reasons for the differences between the statutory federal income tax rate of 34% and the effective tax rates are summarized as follows for the years ended June 30:

	2012			2011
	(In thousands)
Federal income tax at statutory rates	$	430		$	556
Increase (decrease) in tax resulting from:
State taxes, net of federal benefit		1			1
Qualifying option (benefit) expense		(3	)		9
Dividends received deduction		(112	)		(113	)
Bank-owned life insurance		(111	)		(138	)
Tax-exempt municipal income, net		(14	)		(14	)
Expiration unused contributions		-			92
Other, net		24			144
Income tax expense	$	215		$	537
Effective tax rates		17.0	%		32.8	%

The Company had gross deferred tax assets and gross deferred tax liabilities as follows as of June 30:

	2012			2011
	(In thousands)
Deferred tax assets:
Allowance for loan losses	$	918		$	985
Net unrealized holding loss on available-for-sale securities		521			652
Deferred compensation		188			190
Stock-based compensation		64			59
Impairment losses on securities available-for-sale		1,093			1,769
Accrued expenses		159			-
Post retirement benefits		55			37
Interest receivable on non-accrual loans		168			134
Federal carryovers		1,516			1,043
Other		68			42
Gross deferred tax asset		4,750			4,911
Deferred tax liabilities:
Depreciation and amortization		(703	)		(630	)
Deferred loan costs		(157	)		(65	)
Gross deferred tax liability		(860	)		(695	)
Net deferred tax asset	$	3,890		$	4,216

Retained earnings at June 30, 2012 includes a contingency reserve for loan losses of $2,284,000 which represents the tax reserve balance existing at December 31, 1987 and is maintained in accordance with provisions of the Internal Revenue Code applicable to thrift institutions. It is not anticipated that the Company will incur a federal income tax liability related to the reduction of this reserve and accordingly, deferred income taxes of approximately $777,000 have not been recognized as of June 30, 2012 and 2011.

It is the Company’s policy to provide for uncertain tax positions and the related interest and penalties based upon management’s assessment of whether a tax benefit is more likely than not to be sustained upon examination by tax authorities. As of June 30, 2012 and 2011, there were no material uncertain tax positions related to federal and state income tax matters. The Company is currently open to audit under statute of limitations by the Internal Revenue Service and state taxing authorities for the years ended June 30, 2009 through June 30, 2012. The Company records interest and penalties as part of income tax expense. No interest or penalties were recorded for the years ended June 30, 2012 and 2011.

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COMMITMENTS AND CONTINGENT LIABILITIES (Details Textuals) (USD $)	12 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Commitments and Contingencies Disclosure [Abstract]
Total rental expense	$ 153,000	$ 162,000

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BENEFIT PLANS - Summary of status of Incentive Plan (Details 1) (Stock Options, USD $)	12 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
Outstanding at beginning of year	222,921	222,921
Granted
Exercised
Forfeited
Outstanding at end of year	222,921	222,921
Options exercisable at end of year	222,921	218,321
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Roll Forward]
Outstanding at beginning of year	$ 10.62	$ 10.62
Granted
Exercised
Forfeited
Outstanding at end of year	$ 10.62	$ 10.62
Options exercisable at end of year	$ 10.62	$ 10.61

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Consolidated Statements of Income (USD $)	12 Months Ended
	Jun. 30, 2012		Jun. 30, 2011
Interest and dividend income:
Interest and fees on loans	$ 12,964,000		$ 13,694,000
Interest on debt securities	4,260,000		5,547,000
Dividends on marketable equity securities	473,000		473,000
Dividends on Federal Home Loan Bank stock	32,000		12,000
Other interest	9,000		4,000
Total interest and dividend income	17,738,000		19,730,000
Interest expense:
Interest on deposits	3,889,000		4,749,000
Interest on Federal Home Loan Bank advances	2,753,000		3,600,000
Interest on securities sold under agreements to repurchase	13,000		21,000
Total interest expense	6,655,000		8,370,000
Net interest and dividend income	11,083,000		11,360,000
Provision for loan losses	1,152,000		915,000
Net interest and dividend income after provision for loan losses	9,931,000		10,445,000
Non-interest income:
Total other-than-temporary impairment losses on debt securities	(3,522,000)		(3,037,000)
Portion of losses recognized in other comprehensive loss/income	1,558,000	[1]	1,972,000	[1]
Net impairment losses recognized in earnings	(1,964,000)	[2]	(1,065,000)	[2]
Fees for services	1,836,000		2,052,000
Mortgage banking activities	149,000		138,000
Net commissions from brokerage services	116,000		134,000
Bank-owned life insurance income	328,000		407,000
Gain on sales of available-for-sale securities, net	235,000		257,000
Income from legal settlement	1,452,000		420,000
Other income	127,000		160,000
Total non-interest income	2,279,000		2,503,000
Non-interest expense:
Compensation and benefits	5,766,000		5,849,000
Occupancy and equipment	1,291,000		1,333,000
Data processing	661,000		884,000
LAN/ WAN network expense	144,000		104,000
Advertising and marketing	278,000		221,000
OCC/ OTS assessments	184,000		187,000
Professional fees	396,000		327,000
Amortization of intangible asset	122,000		149,000
FDIC deposit insurance	605,000		773,000
Prepayment penalties on Federal Home Loan Bank advances	5,000		31,000
Other real estate owned	105,000		140,000
Write-down of other real estate owned	71,000		95,000
Other non-interest expense	1,317,000		1,220,000
Total non-interest expense	10,945,000		11,313,000
Income before income tax expense	1,265,000		1,635,000
Income tax expense	215,000		537,000
Net income	$ 1,050,000		$ 1,098,000
Earnings per common share:
Basic (in dollars per share)	$ 0.16		$ 0.17
Diluted (in dollars per share)	$ 0.16		$ 0.17
Weighted average common shares outstanding:
Basic (in shares)	6,364,345		6,342,473
Diluted (in shares)	6,364,345		6,342,473

[1] Represents the non-credit component of the other-than-temporary impairment.

[2] Represents the credit component of the other-than-temporary impairment.

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INVESTMENT SECURITIES

12 Months Ended

Jun. 30, 2012

Investments, Debt and Equity Securities [Abstract]

INVESTMENT SECURITIES

3.             INVESTMENT SECURITIES

Debt and equity securities have been classified in the consolidated balance sheets according to management’s intent.  The amortized cost of securities and their fair values, by maturity, are as follows as of the dates indicated:

	Amortized		Gross Unrealized					Fair
	Cost Basis		Gain		(Loss)			Value
	(In thousands)
June 30, 2012:
Available-for-sale:
Debt securities:
U.S. government and government-sponsored securities:
Due within one year	$	450	$	9	$	-		$	459
Corporate bonds and other securities:
After ten years		5,998		-		(1,344	)		4,654
U.S. Government-sponsored and guaranteed mortgage-backed securities:
Due in one year or less		1		-		-			1
From one through five years		416		24		-			440
From five through ten years		2,564		140		-			2,704
After ten years		19,717		1,265		(14	)		20,968
		22,698		1,429		(14	)		24,113
Non-agency mortgage-backed securities:
After ten years		9,601		-		(1,250	)		8,351
Total debt securities		38,747		1,438		(2,608	)		37,577
Equity securities:
Auction rate preferred		10,000		11		(375	)		9,636
Total available-for-sale securities	$	48,747	$	1,449	$	(2,983	)	$	47,213
June 30, 2011:
Available-for-sale:
Debt securities:
U.S. government and agency obligations:
From one through five years	$	630	$	36	$	-		$	666
Corporate bonds and other obligations:
After ten years		5,998		-		(1,093	)		4,905
Mortgage-backed securities		43,253		1,673		(2,888	)		42,038
Equity securities:
Auction rate preferred		10,047		682		(329	)		10,400
Total available-for-sale securities	$	59,928	$	2,391	$	(4,310	)	$	58,009

	Amortized		Gross Unrealized					Fair
	Cost Basis		Gain		(Loss)			Value
	(In thousands)
June 30, 2012:
Held-to-maturity:
U.S. Government and government-sponsored securities:
From one through five years	$	5,996	$	34	$	-		$	6,030
From five through ten years		3,196		149		(7	)		3,338
		9,192		183		(7	)		9,368
U.S. Government-sponsored and guaranteed mortgage-backed securities:
From five through ten years		6,767		192		-			6,959
After ten years		89,236		2,783		(10	)		92,009
		96,003		2,975		(10	)		98,968
Total held to maturity securities	$	105,195	$	3,158	$	(17	)	$	108,336
June 30, 2011:
Held-to-maturity:
U.S. Government and government-sponsored securities:
From one through five years	$	2,000	$	34	$	-		$	2,034
From five through ten years		11,234		51		(26	)		11,259
After ten years		2,851		-		(15	)		2,836
		16,085		85		(41	)		16,129
Mortgage-backed securities		98,656		1,221		(44	)		99,833
Total held to maturity securities	$	114,741	$	1,306	$	(85	)	$	115,962

Proceeds from sales of available-for-sale securities during the year ended June 30, 2012 amounted to $328,000.  Gross realized gains and gross realized losses on those sales amounted to $235,000 and $0, respectively.  Proceeds from sales of available-for-sale securities during the year ended June 30, 2011 amounted to $6,636,000.  Gross realized gains and gross realized losses on those sales amounted to $254,000 and $0, respectively.

During the years ended June 30, 2012 and 2011, the Company received a legal settlement on securities previously written-down due to OTTI in the amounts of $1,452,000 and $420,000, respectively.

The aggregate amortized cost basis and fair value of securities of non-government issuers which exceeded 10% of stockholders’ equity were as follows as of June 30, 2012:

	Amortized		Fair
Issuer	Cost		Value
	(In thousands)
Merrill Lynch Auction Rate Pass Thru	$	5,000	$	4,868

As of June 30, 2012, the total carrying value of securities pledged as collateral to secure public deposits, the Federal Reserve Bank discount window, borrowings and repurchase agreements was $69,965,000.  As of June 30, 2011, the total carrying value of securities pledged as collateral to secure public deposits, the Federal Reserve Bank discount window, and repurchase agreements was $35,841,000.

The aggregate fair value and unrealized losses of securities that have been in a continuous unrealized loss position for less than twelve months and for twelve months or more are as follows as of the dates indicated:

	Less than 12 Months				12 Months or More				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Loss		Value		Loss		Value		Loss
					(In thousands)
June 30, 2012:
Available-for-sale:
Debt securities:
Corporate bonds and other securities	$	-	$	-	$	4,654	$	1,344	$	4,654	$	1,344
U.S. Government sponsored and guaranteed mortgage-backed securities		1,826		14		-		-		1,826		14
Equity securities		7,625		375		-		-		7,625		375
Total temporarily impaired securities		9,451		389		4,654		1,344		14,105		1,733
Held-to-maturity:
U.S. Government and government-sponsored securities		2,257		7		-		-		2,257		7
U.S. Government-sponsored and guaranteed mortgage-backed securities		10,141		10		-		-		10,141		10
Total temporarily impaired held-to-maturity		12,398		17		-		-		12,398		17
Other-than-temporarily impaired debt securities: (1)
Non-agency mortgage-backed securities		1,767		21		6,512		1,229		8,279		1,250
Total temporarily impaired and other-than-temporarily impaired securities	$	23,616	$	427	$	11,166	$	2,573	$	34,782	$	3,000
	Less than 12 Months				12 Months or More				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Loss		Value		Loss		Value		Loss
					(In thousands)
June 30, 2011:
U.S. Government and agency securities	$	3,810	$	41	$	-	$	-	$	3,810	$	41
Corporate bonds and other obligations		-		-		4,905		1,093		4,905		1,093
Mortgage-backed securities		10,323		45		-		-		10,323		45
Equity securities		-		-		6,671		329		6,671		329
Total temporarily impaired securities		14,133		86		11,576		1,422		25,709		1,508
Other-than-temporarily impaired debt securities: (1)
Mortgage-backed securities		4,567		537		7,155		2,350		11,722		2,887
Total temporarily impaired and other-than-temporarily impaired securities	$	18,700	$	623	$	18,731	$	3,772	$	37,431	$	4,395

(1)Includes other-than-temporary impaired available-for-sale debt securities in which a portion of the other-than-temporary impairment loss remains in accumulated other comprehensive loss.

At June 30, 2012, the Company had seven U.S. government-sponsored and guaranteed securities with an unrealized loss.  The unrealized losses were primarily caused by interest rate fluctuations.  These investments are guaranteed or sponsored by the U.S. government or an agency thereof.  Accordingly, it is expected that the securities would not be settled at a price less than the par value of the investment.  Because the decline in market value is attributable to changes in interest rates and not to credit quality, and because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be maturity, the Company does not consider these investments to be other-than-temporarily impaired at June 30, 2012.

At June 30, 2012, the Company had five corporate bonds and other securities with an unrealized loss.  These unrealized losses relate to investments in companies within the financial services sector.  The unrealized losses are primarily caused by (a) interest rate fluctuations, (b) recent decreases in profitability and near-term profit forecasts by industry analysts and (c) recent downgrades by industry analysts.  The contractual terms of these investments do not permit the companies to settle the security at a price less than the par value of investment.  While the companies’ credit ratings have decreased, the Company currently does not believe it is probable that it will be unable to collect all amounts due according to the contractual terms of the investments.  Therefore, it is expected that the bonds would not be settled at a price less than the par value of the investment.  Because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be maturity, the Company does not consider these investments to be other-than-temporarily impaired at June 30, 2012.

For the years ended June 30, 2012, securities with other-than-temporary impairment losses related to credit loss that were recognized in earnings consisted of non-agency mortgage-backed securities.  For these debt securities, the Company estimated the portion of loss attributable to credit loss using a discounted cash flow model.  Significant inputs included the estimated cash flows of the underlying loans based on key assumptions, such as default rate, loss severity and prepayment rate.  Assumptions can vary widely from security to security, and are influenced by such factors as loan interest rate, geographical location of the borrower, borrower characteristics and collateral type.  The present value of the expected cash flows was compared to the Company’s amortized cost basis to determine the credit-related impairment loss.  Based on the expected cash flows derived from the model, the Company expects to recover the remaining unrealized losses on these securities.

For those debt securities for which the fair value of the security is less than its amortized cost and the Company does not intend to sell such security and it is more likely than not that it will not be required to sell such security prior to the recovery of its amortized cost basis less any credit losses, the credit component of the other-than-temporary impairment losses is recognized in earnings while the non-credit component is recognized in other comprehensive income/loss, net of related taxes.

The following table summarizes other-than-temporary impairment losses on securities for the years ended:

	Equity Securities		Corporate Securities		Non-Agency Mortgage- Backed Securities		Total
	(In Thousands)
June 30, 2012:
Total other-than-temporary impairment losses	$	-	$	-	$	3,522	$	3,522
Less: unrealized other-than-temporary losses recognized in accumulated other comprehensive income/loss (1)		-		-		1,558		1,558
Net impairment losses recognized in earnings (2)	$	-	$	-	$	1,964	$	1,964
June 30, 2011
Total other-than-temporary impairment losses	$	-	$	-	$	3,037	$	3,037
Less: unrealized other-than-temporary losses recognized in other comprehensive loss (1)		-		-		1,972		1,972
Net impairment losses recognized in earnings (2)	$	-	$	-	$	1,065	$	1,065

(1) Represents the non-credit component of the other-than-temporary impairment.

(2) Represents the credit component of the other-than-temporary impairment.

Activity related to the credit component recognized in earnings on debt securities held by the Company for which a portion of other-than-temporary impairment was recognized in accumulated other comprehensive loss for the year end June 30, 2012 and 2011 is as follows:

Balance as of June 30, 2010	$	12,242
Credit losses on securities for which other-than-temporary impairment was not previously recorded		3
Additional credit losses on securities for which an other-than-temporary impairment charge was previously recorded		1,062
Reductions for securities sold during the period		-
Balance as of June 30, 2011		13,307
Credit losses on securities for which other-than-temporary impairment was not previously recorded		-
Additional credit losses on securities for which an other-than-temporary impairment charge was previously recorded		1,964
Reductions for securities sold during the period		-
Balance as of June 30, 2012	$	15,271

Significant assumptions used in the valuation of non-agency mortgage-backed securities were as follows as of June 30, 2012:

	Weighted			Range
	Average			Minimum		Maximum
Prepayment rates		18.2	%		0.0%		31.1%
Default rates		21.5	%		5.6%		32.8%
Loss severity		33.0	%		10.0%		37.9%

At June 30, 2012 and 2011, the auction-rate trust preferred securities (ARP) portfolio totaled $9,636,000 and $10,400,000 respectively, all of which were classified as available-for-sale.  At June 30, 2012, two ARP’s were in an unrealized loss position.  Auction-rate trust preferred securities are a floating rate preferred stock, on which the dividend rate generally resets every 90 days based on an auction process to reflect the yield demand for the instruments by potential purchasers.  Our investments in auction-rate trust preferred securities consist of investments in three corporate issuers.  These securities were originally purchased by the Company because they represented highly liquid, tax-preferred investments secured, in most cases, by preferred stock issued by high quality, investment grade companies (generally other financial institutions) (“collateral preferred shares”).  The ARP shares, or certificates, purchased by the Company are Class A certificates, which, among other rights, entitle the holder to priority claim on dividends paid into the Trust holding the preferred shares.

In most cases, the trusts which issued the ARP certificates own various callable preferred shares of stock by a single entity.  In addition to the call dates for redemption established by the collateral preferred shares, each trust has a maturity date upon which the trust itself will terminate.  The value of the remaining collateral preferred shares is not guaranteed, and may be more or less than the stated par value of the collateral preferred shares, and is dependent on the market value of those collateral preferred shares on the date of the trust’s maturity.

The certificates issued by the trusts traded in an active, open auction market, with each individual trust establishing the frequency of its auctions, typically every 90 days (the “reset date”).  The results of an auction would be the exchange of certificates, at par, between participants entering or exiting the market, and resetting of the yield to be earned by holders of the Class A certificates as well as the holders of other classes of trust certificates.

Beginning in February 2008, auctions for these securities began to fail when investors declined to bid on the securities.  Five of the largest investment banks that made a market in these securities (Merrill Lynch, Citigroup, UBS, AIG and Morgan Stanley) declined to act as bidders of last resort, as they had in the past.  The auction failures did not result in the loss of any principal value to the certificate holders, but prevented many sellers from exiting, or redeeming, their certificates at the reset date.  These unsuccessful sellers were required to continue to hold the certificates until the next scheduled reset date.  To compensate these unsuccessful sellers, the failed auctions triggered a penalty-rate feature which provided that owners of the Class A certificates were entitled to a higher portion of the dividends, and thus a higher yield, on the Class A certificates.

During this time, the Company attempted to divest itself of the ARPs, but was prevented from doing so due to the continued failure of the auction market.  The Company continued to carry its investments at par value, despite the increased liquidity risk, because the credit strength of the issuers of the collateral preferred shares remained high, and the yield remained above-market.

The turmoil in the financial markets caused the value of the underlying collateral preferred shares to decline.  These declines in value are not considered other-than-temporary at June 30, 2012 and 2011.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

12 Months Ended

Jun. 30, 2012

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

2.           SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The accounting and reporting policies of the Company and its subsidiary conform to accounting principles generally accepted in the United States of America and predominant practices within the banking industry. The consolidated financial statements of the Company were prepared using the accrual basis of accounting. The significant accounting policies of the Company are summarized below to assist the reader in better understanding the consolidated financial statements and other data contained herein.

              Use of Estimates

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change are the allowance for loan losses, other-than-temporary impairment of securities, the valuation of goodwill and the valuation of deferred tax assets.

Basis of Presentation

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, the Bank, and the Bank’s wholly owned subsidiaries, Windham North, LLC, PSB Realty, LLC and Putnam Bank Mortgage Servicing Company. All significant intercompany accounts and transactions have been eliminated in the consolidation.

Cash and Cash Equivalents

For the purposes of reporting cash flows, cash and cash equivalents include cash, amounts due from depository institutions and interest-bearing deposits with other banks.

Cash and due from banks as of June 30, 2012 and 2011 includes $5,650,000, which is subject to withdrawals and usage restrictions to satisfy the reserve requirements of the Federal Reserve Bank, target balances at Bankers Bank Northeast and for other purposes.

Cash is maintained in bank accounts which, at times may exceed insured limits. The Company has not experienced any issues in such accounts and does not believe it is exposed to any significant credit risk on cash.

Securities

Investments in debt securities are adjusted for amortization of premiums and accretion of discounts computed so as to approximate the interest method. Gains or losses on sales of investment securities are computed on a specific identification basis. All security transactions are recorded on the trade date.

The Company classifies debt and equity securities into one of three categories: held-to-maturity, available-for-sale, or trading. These security classifications may be modified after acquisition only under certain specified conditions. In general, securities may be classified as held-to-maturity only if the Company has the positive intent and ability to hold them to maturity. Trading securities are defined as those bought and held principally for the purpose of selling them in the near term. All other securities must be classified as available-for-sale.

Held-to-maturity securities are measured at amortized cost in the consolidated balance sheets. Unrealized holding gains and losses are not included in earnings or in other comprehensive income/loss. They are disclosed in the notes to the consolidated financial statements.

Available-for-sale securities are carried at fair value on the consolidated balance sheets. Unrealized holding gains and losses are not included in earnings but are included in other comprehensive income/loss, net of applicable taxes.

Trading securities are carried at fair value on the consolidated balance sheets. Unrealized holding gains and losses for trading securities are included in earnings. The Company held no securities classified as trading at June 30, 2012 and 2011.

Each reporting period, the Company evaluates all securities classified as available-for-sale or held-to-maturity, with a decline in fair value below the amortized cost of the investment to determine whether or not the impairment is deemed to be other-than-temporary (“OTTI”).

OTTI is required to be recognized if (1) the Company intends to sell the security; (2) it is “more likely than not” that the Company will be required to sell the security before recovery of its amortized cost basis; or (3) for debt securities, the present value of expected cash flows is not sufficient to recover the entire amortized cost basis. Marketable equity securities are evaluated for OTTI based on the severity and duration of the impairment and, if deemed to be other than temporary, the declines in fair value are reflected in earnings as realized losses. For impaired debt securities that the Company intends to sell, or more likely than not will be required to sell, the full amount of the depreciation is recognized as OTTI through earnings. For all other impaired debt securities, credit-related OTTI is recognized through earnings and non-credit related OTTI is recognized in other comprehensive income/loss, net of applicable taxes.

Federal Home Loan Bank of Boston Stock, at Cost

The Bank, as a member of the Federal Home Loan Bank (“FHLB”) system, is required to maintain an investment in capital stock of the FHLB of Boston. Based on redemption provisions, the stock has no quoted market value and is carried at cost. At its discretion, the FHLB of Boston may declare dividends on the stock. The Bank reviews for impairment based on the ultimate recoverability of the cost basis in the stock. As of June 30, 2012, no impairment has been recognized.

Loans Held-For-Sale

Loans originated and intended for sale in the secondary market are carried at the lower of cost or estimated fair value in the aggregate. Net unrealized losses, if any, are provided for in a valuation allowance by charges to income.

Interest income on loans held-for-sale is accrued currently and classified as interest on loans.

Loans

The Company’s loan portfolio includes residential real estate, commercial real estate, residential construction, commercial and consumer/other segments. Loans that management has the intent and ability to hold for the foreseeable future or until maturity or pay-off generally are reported at their outstanding unpaid principal balances adjusted for charge-offs, the allowance for loan losses, and any deferred fees or costs on originated loans. Interest income is accrued on the unpaid principal balance. Loan origination fees, net of certain direct origination costs, are deferred and recognized as an adjustment of the related loan yield using the interest method.

The accrual of interest on all loans is discontinued at the time the loan is 90 days past due unless the credit is well-secured and in process of collection. Past due status is based on contractual terms of the loan. In all cases, loans are placed on nonaccrual if collection of principal or interest is considered doubtful. All interest accrued but not collected for loans that are placed on nonaccrual is reversed against interest income. The interest on these loans is accounted for on the cash-basis or cost-recovery method, until qualifying for return to accrual. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured.

Allowance for Loan Losses

The allowance for loan losses is established as losses are estimated to have occurred through a provision for loan losses charged to earnings. Loan losses are charged against the allowance when management believes the uncollectability of a loan balance is confirmed.

The allowance for loan losses is evaluated on a quarterly basis by management. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available. The allowance consists of general, specific and unallocated components, as further described below.

General component

The general component of the allowance for loan losses is based on historical loss experience adjusted for qualitative factors stratified by the following loan segments: residential real estate, commercial real estate, residential construction, commercial and consumer/other. Management uses a rolling average of historical losses based on a time frame appropriate to capture relevant loss data for each loan segment. This historical loss factor is adjusted for the following qualitative factors: levels/trends in delinquencies; loan concentrations, trends in volume and terms of loans; changes in lending practices and procedures; changes in lending management and staff; changes in the value of underlying collateral; changes in the quality of the loan review system; national and local economic trends and conditions and the effects of other external factors. During the year ended June 30, 2012, the Company changed the allowance for loan loss calculation to add certain qualitative factors and amend loan segment characterization, resulting in a change in accounting estimate. Qualitative factors were added for changes in lending practices and procedures; changes in the value of underlying collateral; changes in lending management and staff; changes in the quality of the loan review system and the effects of other external factors. In addition, loan segments within the allowance were amended to correspond to call report requirements. These changes did not quantitatively impact the dollar amount of the allowance for loan losses at June 30, 2012, as changes relate only to qualitative assessments and methodology in how the allowance is calculated.

The qualitative factors are determined based on the various risk characteristics of each loan segment. Risk characteristics relevant to each portfolio segment are as follows:

Residential real estate - The Company generally does not originate loans with a loan-to-value ratio greater than 80% and does not originate subprime loans. All loans in this segment are collateralized by owner-occupied residential real estate and repayment is dependent on the credit quality of the individual borrower. The overall health of the economy, including unemployment rates and housing prices, will have an effect on the credit quality in this segment.

Commercial real estate - Loans in this segment are primarily income-producing properties throughout New England. The underlying cash flows generated by the properties are adversely impacted by a downturn in the economy as evidenced by increased vacancy rates, which in turn, will have an effect on the credit quality in this segment. Management obtains rent rolls annually and continually monitors the cash flows of these loans.

Residential construction – Loans in this segment primarily include speculative real estate development loans for which payment is derived from sale of the property. Credit risk is affected by cost overruns, time to sell at an adequate price, and market conditions.

Commercial – Loans in this segment are made to businesses and are generally secured by assets of the business. Repayment is expected from the cash flows of the business. A weakened economy, and resultant decreased consumer spending, will have an effect on the credit quality in this segment.

Consumer/other - Loans in this segment are generally secured and repayment is dependent on the credit quality of the individual borrower.

Specific component

The specific component relates to loans that are classified as impaired. Impairment is measured on a loan by loan basis by either the present value of expected future cash flows discounted at the loan’s effective interest rate or the fair value of the collateral if the loan is collateral dependent or foreclosure is probable. An allowance is established when the discounted cash flows (or collateral value) of the impaired loan is lower than the carrying value of that loan. Large groups of smaller balance homogeneous loans are collectively evaluated for impairment. Accordingly, the Company does not separately identify individual consumer and residential real estate loans for impairment disclosures, unless such loans are subject to a troubled debt restructuring (“TDR”) agreement.

A loan is considered impaired when, based on current information and events, it is probable that the Company will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. Factors considered by management in determining impairment include payment status, collateral value, and the probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant payment delays and payment shortfalls generally are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record, and the amount of the shortfall in relation to the principal and interest owed.

The Company periodically may agree to modify the contractual terms of loans. When a loan is modified and a concession is made to a borrower experiencing financial difficulty, the modification is considered a troubled debt restructuring. All TDRs are initially classified as impaired.

Unallocated component

An unallocated component is maintained to cover uncertainties that could affect management’s estimate of probable losses. The unallocated component of the allowance reflects the margin of imprecision inherent in the underlying assumptions used in the methodologies for estimating specific and general reserves in the portfolio.

Premises and Equipment

Premises and equipment are stated at cost, less accumulated depreciation and amortization. Cost and related allowances for depreciation and amortization of premises and equipment retired or otherwise disposed of are removed from the respective accounts with any gain or loss included in income or expense. Depreciation and amortization are calculated principally on the straight-line method over the estimated useful lives of the assets or term of lease if shorter. Estimated lives are 5 to 40 years for buildings and premises, 3 to 20 years for furniture, fixtures and equipment and lease terms range from 1 to 25 years. Expenditures for replacements or major improvements are capitalized; expenditures for normal maintenance and repairs are charged to expense as incurred.

Other Real Estate Owned

Other real estate owned includes properties acquired through foreclosure and properties classified as in-substance foreclosures. These properties are carried at the lower of cost or estimated fair value less estimated costs to sell. Any write-down from cost to estimated fair value required at the time of foreclosure or classification as in-substance foreclosure is charged to the allowance for loan losses. Expenses incurred in connection with maintaining these assets, subsequent write-downs and gains or losses recognized upon sale are charged to expense.

Goodwill

Goodwill is measured as the excess of the cost of a business acquisition over the sum of the amounts assigned to identifiable tangible and intangible assets acquired less liabilities assumed. Goodwill is not amortized but is reviewed for impairment annually or more frequently if circumstances warrant. The goodwill impairment analysis is a two-step test.

The first step (“Step 1”) is used to identify potential impairment, and involves comparing the reporting unit’s (the consolidated Company, in our case) estimated fair value to its carrying amount, including goodwill. If the estimated fair value of the reporting unit exceeds its carrying amount, goodwill is not deemed to be impaired. Should the carrying amount of the reporting unit exceed its estimated fair value, an indicator of impairment is deemed to exist and a second step is performed to measure the amount of such impairment, if any. The second step (“Step 2”) involves calculating the implied fair value of goodwill. The implied fair value of goodwill is determined in a manner similar to how the amount of goodwill is determined in a business combination (i.e. by measuring the excess of the estimated fair value, as determined in Step 1, over the aggregate estimated fair values of the individual assets, liabilities, and identifiable intangibles as of the impairment testing date). If the implied fair value of goodwill exceeds the carrying amount of goodwill assigned to the reporting unit, no impairment exists. If the carrying amount of goodwill exceeds the implied fair value of the goodwill, an impairment loss is recorded in an amount equal to such excess. An impairment loss cannot exceed the carrying amount of goodwill, and the loss (write-down) establishes a new carrying amount for the goodwill. Subsequent reversal of goodwill impairment losses is not permitted. Application of the goodwill impairment test requires significant judgments including estimation of future cash flows, which are dependent on internal forecasts, estimation of the long-term rate of growth, the period over which cash flows will occur, and determination of our cost of capital. Changes in these estimates and assumptions could materially affect the determination of fair value and/or conclusions related to goodwill impairment. For the year ended June 30, 2012, the Company had no goodwill impairment.

Bank-owned Life Insurance

Bank-owned life insurance policies are reflected on the consolidated balance sheet at cash surrender value. Changes in the net cash surrender value of the policies, as well as insurance proceeds received, are reflected in non-interest income on the consolidated statement of income and are not subject to income taxes.

Fair Value of Financial Instruments

The Company uses fair value measurements to record fair value adjustments to certain assets and to determine fair value disclosures. Fair value methods and assumptions used by the Company in estimating its fair value disclosures are as follows:

Cash and Cash Equivalents: The carrying amounts of cash and cash equivalents approximate fair values based on the short-term nature of the assets.

Investment Securities and FHLB Stock: As of June 30, 2012, all fair value measurements on investment securities are obtained from a third party pricing source and are not adjusted by management.The fair value of securities to be held-to-maturity and available-for-sale is estimated based on quoted market prices, where available. If quoted market prices are not available, fair values are based on quoted market prices of comparable instruments. Ownership of FHLB of Boston stock is restricted to member banks; therefore, the stock is not traded. The estimated fair value of FHLB of Boston stock is equal to its carrying value, which represents the price at which the FHLB of Boston is obligated to redeem its stock.

Loans, net: For valuation purposes, the loan portfolio was segregated into its significant categories, which are residential real estate, commercial real estate, residential construction, commercial and consumer/other loans. These categories were further segregated, where appropriate, into components based on significant financial characteristics such as type of interest rate (fixed or adjustable). Fair values were estimated for each component using assumptions developed by management and a valuation model provided by a third party specialist.

The fair values of residential real estate, commercial real estate, residential construction, commercial and consumer and other loans were estimated by discounting the anticipated cash flows from the respective portfolios. Estimates of the timing and amount of these cash flows considered factors such as future loan prepayments. The discount rates reflected current market rates for loans with similar terms to borrowers of similar credit quality. The fair value of home equity lines of credit was based on the outstanding loan balances. Fair values for non-performing loans are estimated using discounted cash flow analyses or underlying collateral values, where applicable.

Loans held for sale: Loans held for sale are accounted for at the lower of cost or market and the fair value of loans held for sale are based on quoted market prices of similar loans sold in conjunction with securitization transactions, adjusted as required for changes in loan characteristics.

Accrued interest: The carrying amounts of accrued interest approximate fair value.

Deposits and Mortgagors’ Escrow: The fair value of deposits with no stated maturity such as demand deposits, NOW, regular savings, and money market deposit accounts, and mortgagors’ escrow accounts, is equal to the amount payable on demand. The fair value estimates do not include the benefit that results from the generally lower cost of funding provided by the deposit liabilities compared to the cost of borrowing funds in the market. The fair value estimate of time deposits is based on the discounted value of contractual cash flows. The discount rate is estimated using market rates currently offered for deposits having similar remaining maturities.

Federal Home Loan Bank Advances: The fair values of the Company’s Federal Home Loan Bank advances are estimated using discounted cash flow analyses based on the current incremental borrowing rates in the market for similar types of borrowing arrangements.

Securities Sold Under Agreements to Repurchase: The Company enters into overnight repurchase agreements with its customers. Since these agreements are short-term instruments, the fair value of these agreements approximates their recorded balance. The fair value of these agreements are determined by discounting the anticipated future cash payments using rates currently available to the Bank for debt with similar terms and remaining maturities.

Off-Balance Sheet Instruments: The fair value of off-balance-sheet mortgage lending commitments are based on fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements and the counterparties’ credit standing. In the case of the commitments discussed in Note 12, the fair value equals the carrying amounts which are not significant.

               Earnings per Share (EPS)

Basic earnings per share represents income available to common stockholders divided by the weighted-average number of common shares outstanding during the period. If rights to dividends on unvested options/awards are non-forfeitable, these unvested awards/options are considered outstanding in the computation of basic earnings per share. Diluted earnings per share reflects additional common shares that would have been outstanding if dilutive potential common shares had been issued, as well as any adjustment to income that would result from the assumed issuance. Potential common shares that may be issued by the Company relate to outstanding stock options and restricted stock awards and are determined using the treasury stock method.

Treasury shares and unallocated ESOP shares are not deemed outstanding for earnings per share calculations.

Earnings per share have been computed based on the following:

	Income			Shares			Per-Share
	(Numerator)			(Denominator)			Amount
Year ended June 30, 2012:
Basic EPS:
Net income	$	1,050,000
Net income and income allocated to common stockholders		1,050,000			6,364,345
Basic EPS						$	0.16
Diluted EPS:
Effect of dilutive securities options					-
Diluted EPS	$	1,050,000			6,364,345		$	0.16
Year ended June 30, 2011:
Basic EPS:
Net income	$	1,098,000
Dividends and undistributed earnings allocated to unvested shares		(2,000	)
Net income and income allocated to common stockholders		1,096,000			6,342,473		$	0.17
Effect of dilutive securities options and warrants					N/A
Diluted EPS:
Income attributable to common stockholders and assumed conversions	$	1,096,000			6,342,473		$	0.17

At June 30, 2012, options for 222,921 shares were not included in the computation of earnings per share as the effects were anti-dilutive.

Transfers of Financial Assets

Transfers of an entire financial asset, a group of entire financial assets, or a participating interest in an entire financial asset are accounted for as sales when control over the assets has been surrendered. Control over transferred assets is deemed to be surrendered when (1) the assets have been isolated from the Company, (2) the transferee obtains the right to pledge or exchange the transferred assets, and (3) the Company does not maintain effective control over the transferred assets.

               Advertising

The Company directly expenses costs associated with advertising as they are incurred.

Income Taxes

Deferred income tax assets and liabilities are determined using the liability (or balance sheet) method. Under this method, the net deferred tax asset or liability is determined based on the tax effects of the temporary differences between the book and tax basis of the various balance sheet assets and liabilities and gives current recognition to changes in tax rates and laws. A valuation allowance is established against deferred tax assets when, based upon the available evidence including historical and projected taxable income, it is more likely than not that some or all of the deferred tax assets will not be realized.

Income tax benefits related to stock compensation in excess of grant date fair value less any proceeds on exercise are recognized as an increase to additional paid-in capital upon vesting or exercising and delivery of the stock. Any income tax effects related to stock compensation that are less than grant date fair value less any proceeds on exercise would be recognized as a reduction of additional paid in capital to the extent of previously recognized income tax benefits and then through income tax expense for the remaining amount.

Employee Benefit Plans

The Company established an Employee Stock Ownership Plan (the ESOP) as part of its minority stock issuance on October 4, 2004. The ESOP is accounted for in accordance with Accounting Standards Codification (“ASC”) 718-40, “Compensation - Stock Compensation - Employee Stock Ownership Plan.” Under ASC 718-40, unearned ESOP shares are not considered outstanding and are therefore not taken into account when computing earnings per share. Unearned ESOP shares are presented as a reduction to stockholders’ equity and represent shares to be allocated to ESOP participants in future periods for services provided to the Company. As shares are committed to be released, compensation expense is recognized for the fair market value of the stock and stockholders’ equity is increased by a corresponding amount. The loan to the ESOP will be repaid principally from the Bank’s contributions to the ESOP and dividends payable on common stock held by ESOP over a period of 20 years.

As more fully described in Note 14, the Company has a stock-based incentive plan authorizing various types of incentive awards that may be granted to directors, officers and employees. The Company accounts for the plan under ASC 718-10, “Compensation - Stock Compensation - Overall.” In accordance with ASC 718-10, the Company records share-based compensation expense related to outstanding stock option and restricted stock awards based upon the fair value at the date of grant over the vesting period of such awards on a straight-line basis. During the years ended June 30, 2012 and 2011, $24,000 and $121,000, respectively, in stock-based employee compensation was recognized.

              Recent Accounting Pronouncements

In April 2011, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2011-02, Receivables (Topic 310), A Creditor’s Determination of Whether a Restructuring Is a Troubled Debt Restructuring. This update provides additional guidance and clarification to help creditors in determining whether a creditor has granted a concession and whether a debtor is experiencing financial difficulties for purposes of determining whether a restructuring constitutes a troubled debt restructuring (“TDR”). This update is effective for the first interim or annual period beginning on or after June 15, 2011, with retrospective application to the beginning of the annual period of adoption. The measurement of impairment should be done prospectively in the period of adoption for loans that are newly identified as TDRs upon adoption of this update. In addition, the TDR disclosures required by ASU 2010-20, Receivables (Topic 310), Disclosures about the Credit Quality of Financing Receivables and the Allowance for Credit Losses should be provided beginning in the period of adoption of this update. This guidance was adopted by the Company as of July 1, 2011 and did not have a material impact on the Company’s consolidated financial statements.

In April 2011, the FASB issued ASU 2011-03, Transfers and Servicing (Topic 860), Reconsideration of Effective Control for Repurchase Agreements. This update removes from the assessment of effective control for repurchase agreements (1) the criterion used to assess effective control relating to the transferor’s ability to repurchase or redeem financial assets even in the event of a default by the transferee and (2) the collateral maintenance implementation guidance related to that criterion. This update is effective for the first interim or annual period beginning on or after December 15, 2011 and should be applied prospectively to transactions or modifications of existing transactions that occur on or after the effective date. This guidance was adopted by the Company as of January 1, 2012, and did not have a material impact on the Company’s consolidated financial statements.

In May 2011, the FASB issued ASU 2011-04, Fair Value Measurement (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRS. This update clarifies and expands the disclosures pertaining to unobservable inputs in Level 3 fair value measurements. The guidance also requires, for public companies, disclosure of the level within the fair value hierarchy for assets and liabilities not measured at fair value in the statement of financial position but for which the fair value is disclosed. The amendments in this update are to be applied prospectively. For public entities, the amendments are effective during interim and annual periods beginning after December 15, 2011. This guidance was adopted by the Company as of January 1, 2012, and did not have a material impact on the Company’s consolidated financial statements.

In June 2011, the FASB issued ASU 2011-05, Comprehensive Income (Topic 220), Presentation of Comprehensive Income. This update amends the disclosure requirements for the presentation of comprehensive income. The amended guidance eliminates the option to present components of other comprehensive income (OCI) as part of the statement of changes in stockholder’s equity. Under the amended guidance, all changes in OCI are to be presented either in a single continuous statement of comprehensive income or in two separate but consecutive financial statements. The changes, as modified by ASU 2011-12, are effective for fiscal years, and interim periods within those years, beginning after December 15, 2011, although early application is permitted. In December 2011, the FASB issued ASU 2011-12 to defer changes that relate to the presentation of reclassification adjustments but the other requirements of ASU 2011-05 remain in effect. This amendment will be effective for the Company for annual and interim periods beginning July 1, 2012 and is not expected to have a material impact on the Company’s consolidated financial statements.

In September 2011, the FASB issued ASU 2011-08, Intangibles – Goodwill and Other (Topic 350), Testing Goodwill for Impairment. This update is intended to reduce the complexity and cost of performing an evaluation of impairment of goodwill. Under the new guidance, an entity will have the option of first assessing qualitative factors (events and circumstances) to determine whether it is more likely than not (meaning a likelihood of more than 50 percent) that the fair value of a reporting unit is less than its carrying amount. If, after considering all relevant events and circumstances, an entity determines it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the two-step impairment test will be unnecessary. The amendments will be effective for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 2011. This amendment will be effective for the Company for annual and interim periods beginning July 1, 2012 and is not expected to have a material impact on the Company’s consolidated financial statements.

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BENEFIT PLANS

12 Months Ended

Jun. 30, 2012

Compensation and Retirement Disclosure [Abstract]

BENEFIT PLANS

14. BENEFIT PLANS

Defined Contribution Plan

The Bank has a defined contribution plan that covers substantially all of the Bank’s employees. Contributions to the plan are discretionary and are voted on annually by the Board of Directors of the Bank. The Bank recognized expense of $158,000 and $231,000 for the years ended June 30, 2012 and 2011, respectively.

401(k) Plan

The Bank has a 401(k) plan covering each eligible employee. Employees must be 21 years of age, work at least 1,000 hours per year, and have at least one year of service with the Bank to be eligible to participate. Employees may defer gross compensation up to certain limits defined in the Internal Revenue Code. The Bank’s matching contribution is discretionary. For the years ended June 30, 2012 and 2011 the Bank chose to contribute 25% of an employee’s deferral on a maximum of 4% of the employee’s salary. The Bank contributed $33,000 to the plan during the years ended June 30, 2012 and 2011.

Other Postretirement Benefit Plan

The Bank has recorded a liability for its future postretirement benefit obligations under certain death benefit agreements. The total liability for the arrangements included in other liabilities was $162,000 at June 30, 2012 and $109,000 at June 30, 2011. Expense under this arrangement was $53,000 for 2012 and $6,000 for 2011. No death benefits were paid under this arrangement for 2012 and 2011.

Employee Stock Ownership Plan

The Bank established the ESOP on October 4, 2004 in connection with its common stock offering. The ESOP purchased 257,062 shares of the common stock of the Company. To fund the purchase, the ESOP borrowed $2.6 million from the Company. The borrowing is at an initial interest rate of 4.75% and is to be repaid on a pro-rata basis in 20 substantially equal annual installments. The collateral for the loan is the common stock of the Company purchased by the ESOP.

The shares of stock purchased by the ESOP are held in a suspense account until they are released for allocation among participants. The shares will be released annually from the suspense account and the released shares will be allocated amount the participants on the basis of each participant’s compensation for the year of allocation. As shares are released from collateral, the Bank recognizes compensation expense equal to the average market price of the shares during the period and the shares will be outstanding for earnings-per-share purposes. The shares not released are reported as unearned ESOP shares in the capital accounts of the consolidated balance sheets. ESOP expense for the years ended June 30, 2012 and 2011 was $60,000 and $57,000, respectively. At June 30, 2012 and 2011 there were 100,513 and 87,734 shares allocated, respectively, and 156,549 and 169,328 unreleased ESOP shares, respectively. The fair value of unreleased ESOP shares at June 30, 2012 and 2011 was $654,000 and $879,000, respectively.

Stock-based Incentive Plan

At the annual meeting of stockholders on October 31, 2005, stockholders of the Company approved the PSB Holdings, Inc. 2005 Stock-Based Incentive Plan (the Incentive Plan). Under the Incentive Plan, the Company may grant up to 340,213 stock options and 136,085 shares of restricted stock to its employees, officers and directors for an aggregate amount of up to 476,298 shares of the Company’s common stock for issuance upon the grant or exercise of awards. Both incentive stock options and non-statutory stock options may be granted under the Incentive Plan.

On November 7, 2005, the Company awarded 319,800 options to purchase the Company’s common stock and 129,281 shares of restricted stock. Stock option awards were granted with an exercise price equal to the market price of the Company’s stock at the date of grant ($10.60) with a maximum term of ten years. Both stock option and restricted stock awards vest at 20% per year beginning on the first anniversary of the date of the grant.

On June 7, 2006, the Company awarded 18,000 options to purchase the Company’s common stock and 6,000 shares of restricted stock. Stock option awards were granted with an exercise price equal to the market price of the Company’s stock at the date of grant ($10.78) with a maximum term of ten years. Both stock option and restricted stock awards vest at 20% per year beginning on the first anniversary of the date of the grant.

On May 25, 2007, the Company awarded 29,000 options to purchase the Company’s common stock and 9,500 shares of restricted stock. Stock option awards were granted with an exercise price equal to the market price of the Company’s stock at the date of grant ($10.70) with a maximum term of ten years. Both stock option and restricted stock awards vest at 20% per year beginning on the first anniversary of the date of the grant. Stock options are considered common stock equivalents for the purpose of computing earnings per share on a diluted basis.

The Company has recorded share-based compensation expense related to outstanding stock option and restricted stock awards based upon the fair value at the date of grant over the vesting period of such awards on a straight-line basis. The fair value of each restricted stock allocation, based on the market price at the date of grant, is recorded to unearned stock awards. Compensation expenses related to unearned restricted shares are amortized to compensation and benefits expense over the vesting period of the restricted stock awards. The fair value of each stock option award is estimated on the date of grant using the Black-Scholes option pricing model which includes several assumptions such as volatility, expected dividends, expected term and risk-free rate for each stock option award.

In determining the expected term of the option awards, the Company elected to follow the simplified method as permitted by ASC 718-10-599-1, which was issued to provide guidance on the implementation of ASC 718-10. Under this method, the Company has estimated the expected term of the options as being equal to the average of the vesting term plus the original contractual term. The Company estimated its volatility using the historical volatility of other, similar companies during a period of time equal to the expected life of the options. The risk-free rate for the periods within the contractual life of the options is based upon the U.S. Treasury yield curve in effect at the time of grant. The weighted-average fair value of stock options granted using the Black-Scholes option pricing model and the assumptions used to determine the weighted-average fair value of stock options granted were as follows:

	November 7, 2005 Grant			June 7, 2006 Grant			May 25, 2007 Grant
Dividend yield		1.89	%		2.23	%		2.24	%
Expected volatility		12.65	%		12.17	%		11.04	%
Risk-free rate		4.56	%		4.95	%		4.86	%
Expected life in years		6.5			6.5			6.5
Fair value	$	2.00		$	1.97		$	1.84

A summary of the status of the Incentive Plan as of June 30, 2012 and 2011 and changes during the years then ended is presented below:

	2012				2011
			Weighted				Weighted
			Average				Average
	Number of		Exercise		Number of		Exercise
	Shares		Price		Shares		Price
Outstanding at beginning of year		222,921	$	10.62		222,921	$	10.62
Granted		-		-		-		-
Exercised		-		-		-		-
Forfeited		-		-		-		-
Outstanding at end of year		222,921	$	10.62		222,921	$	10.62
Options exercisable at end of year		222,921	$	10.62		218,321	$	10.61

The following table summarizes information about stock options outstanding as of June 30, 2012:

Options Outstanding							Options Exercisable
	Number		Weighted-Average				Number
Exercise	Outstanding		Remaining		Weighted-Average		Exercisable		Weighted-Average
Price	as of 6/30/12		Contractual Life		Exercise Price		as of 6/30/12		Exercise Price
$ 10.60		193,921		3.36	$	10.60		193,921	$	10.60
10.70		23,000		4.90		10.70		23,000		10.70
10.78		6,000		3.94		10.78		6,000		10.78

At June 30, 2012, there were no unrecognized compensation costs related to nonvested share based compensation. The Company recorded share-based compensation expense of $24,000 and $121,000 for the years ended June 30, 2012 and 2011, respectively, in connection with the stock option and restricted stock awards.

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COMMITMENTS AND CONTINGENT LIABILITIES

12 Months Ended

Jun. 30, 2012

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENT LIABILITIES

10. COMMITMENTS AND CONTINGENT LIABILITIES

Lease Commitments

As of June 30, 2012 the Company leases space for its Gales Ferry, Griswold and Putnam Price Chopper branch offices. The leases for the branch offices expire March 31, 2015, October 31, 2014 and August 31, 2016, respectively. All leases contain renewal options at the Company’s discretion. The Company also has miscellaneous equipment leases with various terms. The total minimum rental due in future periods under these existing agreements is as follows as of June 30, 2012:

	Rental
	Expense Due
	(In thousands)
2013	$	154
2014		150
2015		98
2016		51
2017		8
Thereafter		-
Total	$	461

Total rental expense amounted to $153,000 and $162,000 for the years ended June 30, 2012 and 2011, respectively.

Legal Contingencies

Various legal claims also arise from time to time in the normal course of business which, in the opinion of management, will have no material effect on the Company’s consolidated financial statements.

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FAIR VALUE MEASUREMENTS - Company's financial instruments, all of which are held or issued for purposes other than trading (Details 3) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Jun. 30, 2011
Financial assets:
Cash and cash equivalents	$ 11,413	$ 8,273
Available-for-sale securities	47,213	58,009
Held-to-maturity securities	105,195	114,741
Federal Home Loan Bank Stock	7,536	8,056
Accrued interest receivable	1,158	1,528
Financial liabilities:
Deposits	342,338	333,773
Mortgagors' escrow accounts	2,034	1,766
Securities sold under agreements to repurchase	3,653	4,244
Federal Home Loan Bank advances	53,500	83,500
Carrying amount
Financial assets:
Cash and cash equivalents	11,413	8,273
Available-for-sale securities	47,213	58,009
Held-to-maturity securities	105,195	114,741
Federal Home Loan Bank Stock	7,536	8,056
Loans held-for-sale	776	1,567
Loans, net	248,572	253,225
Accrued interest receivable	1,158	1,528
Financial liabilities:
Deposits	342,338	333,773
Mortgagors' escrow accounts	2,034	1,766
Securities sold under agreements to repurchase	3,653	4,244
Federal Home Loan Bank advances	53,500	83,500
Fair value hierarchy level 1
Financial assets:
Cash and cash equivalents	11,413
Available-for-sale securities
Held-to-maturity securities
Federal Home Loan Bank Stock
Loans held-for-sale
Loans, net
Accrued interest receivable
Financial liabilities:
Deposits
Mortgagors' escrow accounts
Securities sold under agreements to repurchase
Federal Home Loan Bank advances
Fair value hierarchy level 2
Financial assets:
Cash and cash equivalents
Available-for-sale securities	47,213
Held-to-maturity securities	108,336
Federal Home Loan Bank Stock
Loans held-for-sale
Loans, net
Accrued interest receivable
Financial liabilities:
Deposits
Mortgagors' escrow accounts
Securities sold under agreements to repurchase	3,653
Federal Home Loan Bank advances	55,340
Fair value hierarchy level 3
Financial assets:
Cash and cash equivalents
Available-for-sale securities
Held-to-maturity securities
Federal Home Loan Bank Stock	7,536
Loans held-for-sale	794
Loans, net	255,075
Accrued interest receivable	1,158
Financial liabilities:
Deposits	344,675
Mortgagors' escrow accounts	2,034
Securities sold under agreements to repurchase
Federal Home Loan Bank advances
Fair Value
Financial assets:
Cash and cash equivalents	11,413	8,273
Available-for-sale securities	47,213	58,009
Held-to-maturity securities	108,336	115,962
Federal Home Loan Bank Stock	7,536	8,056
Loans held-for-sale	782	1,583
Loans, net	255,074	257,835
Accrued interest receivable	1,158	1,528
Financial liabilities:
Deposits	344,675	331,132
Mortgagors' escrow accounts	2,034	1,766
Securities sold under agreements to repurchase	3,653	4,244
Federal Home Loan Bank advances	$ 55,340	$ 87,339

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GOODWILL AND INTANGIBLE ASSETS

12 Months Ended

Jun. 30, 2012

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND INTANGIBLE ASSETS

6.       GOODWILL AND INTANGIBLE ASSETS

Intangible assets consist of goodwill and core deposit intangibles which resulted from the Bank’s purchase of three branches from another financial institution in October 2005. Goodwill is evaluated for impairment on an annual basis, and for the year ended June 30, 2012 and   2011 was not deemed to be impaired. The core deposit intangible is being amortized on an accelerated basis over a ten year period.

	June 30,
	2012		2011
	(In thousands)
Balances not subject to amortization:
Goodwill	$	6,912	$	6,912
Balances subject to amortization:
Core deposit intangible		202		324
Total intangible assets	$	7,114	$	7,236

The amortization expense for the core deposit intangible was $122,000 and $149,000 for the years ended June 30, 2012 and June 30, 2011, respectively.

Expected future amortization expense is as follows:

	Years
	Ending
	June 30,
	(In thousands)
2013	$	93
2014		65
2015		36
2016		8
Total	$	202

The following table reflects the gross carrying amount of core deposits intangibles as of June 30:

	2012
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
	(In thousands)
Core deposit intangible	$	1,553	$	1,351	$	202
	2011
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
	(In thousands)
Core deposit intangible	$	1,553	$	1,229	$	324

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LOANS - Summary of modifications that were deemed to be troubled debt restructures (Details 6) (Loans receivables, USD $) In Thousands, unless otherwise specified	Jun. 30, 2012 Contracts
Accounts, Notes, Loans and Financing Receivable [Line Items]
Number of Contracts	27
Pre-Modifcation Outstanding Recorded Investment	$ 4,106
Post-Modification Outstanding Recorded Investment	4,110
Residential real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Number of Contracts	11
Pre-Modifcation Outstanding Recorded Investment	1,882
Post-Modification Outstanding Recorded Investment	1,883
Commercial real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Number of Contracts	16
Pre-Modifcation Outstanding Recorded Investment	2,224
Post-Modification Outstanding Recorded Investment	$ 2,227

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LOANS

12 Months Ended

Jun. 30, 2012

Accounts, Notes, Loans and Financing Receivable, Gross, Allowance, and Net [Abstract]

LOANS

4.            LOANS

Loans consisted of the following as of June 30:

	2012			2011
	(Dollars in thousands)
Mortgage loans:
Residential	$	200,148		$	193,084
Commercial real estate		45,032			53,248
Residential construction		3,044			2,824
Commercial		3,459			7,356
Consumer and other		898			1,070
Total loans		252,581			257,582
Unadvanced construction loans		(1,559	)		(1,476	)
		251,022			256,106
Net deferred loan costs		463			191
Allowance for loan losses		(2,913	)		(3,072	)
Loans, net	$	248,572		$	253,225
Weighted average yield		4.95	%		5.33	%

The Company’s lending is conducted principally in Eastern Connecticut.  The Company’s loan portfolio includes both adjustable and fixed rate loans.  The composition of the Company’s loan portfolio, by maturity, at June 30, 2012 and 2011 was as follows:

	2012		2011
	(In thousands)
Fixed rate:
Term to maturity
One month through one year	$	9,275	$	8,701
One year through three years		6,344		12,800
Three years through five years		7,785		8,905
Five years through ten years		22,504		24,098
Over ten years		104,486		97,888
		150,394		152,392
Adjustable rate:
Rate adjustment
One month through one year		57,995		54,727
One year through three years		26,313		24,702
Three years through five years		10,814		17,865
Over five years		5,506		6,420
		100,628		103,714
Total loans	$	251,022	$	256,106

The adjustable rate loans generally have interest rate adjustment limitations and are generally indexed to the Company’s cost of funds, prime rate, or to the U.S. Treasury Bill rate.

The following tables set forth information regarding the allowance for loan losses by portfolio segment at and for the years ended June 30, 2012 and 2011:

	Residential			Commercial			Residential						Consumer
	Real Estate			Real Estate			Construction			Commercial			& Other			Unallocated			Total
	(In thousands)
Year Ended June 30, 2012
Allowance for loan losses:
Beginning balance	$	1,520		$	1,286		$	28		$	140		$	11		$	87		$	3,072
Charge-offs		(364	)		(928	)		-			-			(60	)		-			(1,352	)
Recoveries		7			-			-			11			23			-			41
Provision		322			989			(8	)		(134	)		63			(80	)		1,152
Ending balance	$	1,485		$	1,347		$	20		$	17		$	37		$	7		$	2,913
At June 30, 2012
Ending balance: Amount of allowance for impaired loans	$	185		$	190		$	-		$	-		$	-		$	-		$	375
Ending balance: Amount of allowance for loan losses for non-impaired loans	$	1,300		$	1,157		$	20		$	17		$	37		$	7		$	2,538
Loans:  Ending balance	$	200,148		$	44,218		$	2,299		$	3,459		$	898		$	-		$	251,022	(1)
Ending balance: Impaired loans	$	4,846		$	10,070		$	424		$	-		$	27		$	-		$	15,367
Ending balance: Non-impaired loans	$	195,302		$	34,148		$	1,875		$	3,459		$	871		$	-		$	235,655
(1) Does not include deferred fees or costs.
	Residential			Commercial			Residential						Consumer
	Real Estate			Real Estate			Construction			Commercial			& Other			Unallocated			Total
	(In thousands)
June 30, 2011
Allowance for credit losses:
Beginning balance	$	1,332		$	901		$	10		$	297		$	43		$	68		$	2,651
Charge-offs		208			62			-			212			72			-			554
Recoveries		6			-			-			18			36			-			60
Provision		390			447			18			37			4			19			915
Ending Balance	$	1,520		$	1,286		$	28		$	140		$	11		$	87		$	3,072
Ending balance: Individually evaluated for impairment	$	236		$	686		$	-		$	-		$	6		$	-		$	928
Ending balance: Collectively evaluated for impairment	$	1,284		$	600		$	28		$	140		$	5		$	87		$	2,144
Loans:
Ending Balance	$	193,084		$	52,686		$	1,910		$	7,356		$	1,070		$	-		$	256,106
Ending balance: Individually evaluated for impairment	$	2,415		$	8,093		$	-		$	-		$	57		$	-		$	10,565
Ending balance: Collectively evaluated for impairment	$	190,669		$	44,593		$	1,910		$	7,356		$	1,013		$	-		$	245,541

Credit Quality Information

The Company utilizes a nine grade internal loan rating risk system as follows:

Loans rated 1 - 5:  Loans in these categories are considered “pass” rated loans with low to average risk.

Loans rated 6:  Loans in this category are considered “special mention.”  These loans are starting to show signs of potential weakness and are being closely monitored by management.

Loans rated 7:  Loans in this category are considered “substandard.”  Generally, a loan is considered substandard if it is inadequately protected by the current net worth and paying capacity of the obligors and/or the collateral pledged.  There is a distinct possibility that the Company will sustain some loss if the weakness is not corrected.

Loans rated 8:  Loans in this category are considered “doubtful.”  Loans classified as doubtful have all the weaknesses inherent in those classified substandard with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, highly questionable and improbable.

Loans rated 9:  Loans in this category are considered uncollectible (“loss”) and of such little value that their continuance as loans is not warranted.

On an annual basis, or more often if needed, the Company formally reviews the ratings on all residential real estate, commercial real estate, residential construction, commercial and consumer/other loans.  Annually, the Company engages an independent third-party to review a significant portion of loans within these segments.  Management uses the results of these reviews as part of its annual review process.  Credit quality for residential real estate and consumer/other loans is determined by monitoring loan payment history and ongoing communications with customers.

The following tables present the Company’s loans by risk rating as of June 30, 2012 and 2011.

	Residential		Commercial		Residential				Consumer
	Real Estate		Real Estate		Construction		Commercial		& Other		Total
	(In thousands)
June 30, 2012
Grade:
Pass	$	195,825	$	32,032	$	1,875	$	2,834	$	898	$	233,464
Special Mention		338		1,719		-		625		-		2,682
Substandard		3,605		9,998		424		-		-		14,027
Doubtful		380		469		-		-		-		849
Loss		-		-		-		-		-		-
Total	$	200,148	$	44,218	$	2,299	$	3,459	$	898	$	251,022
	Residential		Commercial		Residential				Consumer
	Real Estate		Real Estate		Construction		Commercial		& Other		Total
	(In thousands)
June 30, 2011
Grade:
Pass	$	191,309	$	37,787	$	1,910	$	6,509	$	1,070	$	238,585
Special Mention		23		3,783		-		847		-		4,653
Substandard		1,752		11,116		-		-		-		12,868
Doubtful		-		-		-		-		-		-
Loss		-		-		-		-		-		-
Total	$	193,084	$	52,686	$	1,910	$	7,356	$	1,070	$	256,106

The following is a summary of past due and non-accrual loans at June 30, 2012 and 2011:

					90 days
	30–59 Days		60–89 Days		or Greater		Total		Total
	Past Due		Past Due		Past Due		Past Due		Non-accrual
	(In thousands)
2012
Real estate:
Residential	$	363	$	162	$	940	$	1,465	$	3,985
Commercial		159		-		1,573		1,732		3,975
Residential construction		-		-		424		424		424
Total	$	522	$	162	$	2,937	$	3,621	$	8,384

					90 days
	30–59 Days		60–89 Days		or Greater		Total		Total
	Past Due		Past Due		Past Due		Past Due		Non-accrual
	(In thousands)
2011
Real estate:
Residential	$	92	$	247	$	1,126	$	1,465	$	1,752
Commercial		629		488		3,324		4,441		4,635
Residential construction		-		-		-		-		-
Commercial		150		-		-		150		-
Consumer & other		-		-		-		-		-
Total	$	871	$	735	$	4,450	$	6,056	$	6,387

At June 30, 2012, there were no loans greater than 90 days past due still accruing interest.  At June 30, 2011, one residential real estate loan in the amount of $32,000 was greater than 90 days past due and still accruing interest.

The following is information pertaining to impaired loans:

	At June 30, 2012						Year Ended June 30, 2012
											Interest
			Unpaid				Average		Interest		Income
	Recorded		Principal		Related		Recorded		Income		Recognized
	Investment		Balance		Allowance		Investment		Recognized		on Cash Basis
	(In thousands)
Impaired loans without a valuation allowance:
Real estate:
Residential	$	1,415	$	1,415	$	-	$	1,235	$	29	$	9
Commercial		6,668		6,754		-		3,370		97		87
Residential construction		424		424		-		426		9		9
Commercial		-		-		-		26		11		7
Consumer & other		27		27		-		43		4		-
Total impaired with no related allowance		8,534		8,620		-		5,100		150		112
Impaired loans with a valuation allowance:
Real estate:
Residential	$	3,431	$	3,527	$	185	$	2,957	$	66	$	33
Commercial		3,402		3,768		190		3,319		127		22
Total impaired with an allowance recorded		6,833		7,295		375		6,276		193		55
Total impaired loans:
Real Estate:
Residential	$	4,846	$	4,942	$	185	$	4,192	$	95	$	42
Commercial		10,070		10,522		190		6,689		224		109
Residential construction		424		424		-		426		9		9
Commercial		-		-		-		26		11		7
Consumer & other		27		27		-		43		4		-
Total impaired loans	$	15,367	$	15,915	$	375	$	11,376	$	343	$	167

											Interest
			Unpaid				Average		Interest		Income
	Recorded		Principal		Related		Recorded		Income		Recognized
	Investment		Balance		Allowance		Investment		Recognized		on Cash Basis
	(In thousands)
June 30, 2011
Impaired loans without a valuation allowance:
Real Estate:
Residential	$	395	$	393	$	-	$	1,071	$	4	$	4
Commercial		2,625		2,623		-		2,719		22		9
Residential construction		-		-		-		-		-		-
Commercial		-		-		-		-		-		-
Consumer and other		51		51		-		17		3		-
Total impaired with no related allowance		3,071		3,067		-		3,807		29		13
Impaired loans with a valuation allowance:
Real estate:
Residential	$	2,025	$	2,022	$	236	$	1,381	$	58	$	5
Commercial		5,472		5,470		686		3,787		137		49
Residential construction		-		-		-		-		-		-
Commercial		-		-		-		43		-		-
Consumer and other		6		6		6		21		-		-
Total impaired with an allowance recorded		7,503		7,498		928		5,232		195		54
Total impaired loans:
Real estate:
Residential	$	2,420	$	2,415	$	236	$	2,452	$	62	$	9
Commercial		8,097		8,093		686		6,506		159		58
Residential construction		-		-		-		-		-		-
Commercial		-		-		-		43		-		-
Consumer and other		57		57		6		38		3		-
Total impaired loans	$	10,574	$	10,565	$	928	$	9,039	$	224	$	67

Included in certain impaired loan categories are troubled debt restructurings that were classified as impaired.  At June 30, 2012 and 2011, the Company had $8,237,000 and $5,682,000 in loans, respectively, that were modified in troubled debt restructurings and considered impaired.

The following table represents modifications that were deemed to be troubled debt restructures during the year ended June 30, 2012:

			Pre-Modification		Post-Modification
			Outstanding		Outstanding
	Number of		Recorded		Recorded
	Contracts		Investment		Investment
	(Dollars in thousands)
Real estate:
Residential		11	$	1,882	$	1,883
Commercial		16		2,224		2,227
		27	$	4,106	$	4,110

The majority of residential loans were modified to reduce stated interest rates and others were modified to extend maturity dates and change amortization schedules.  The majority of commercial loans were modified to reduce stated interest rates and others were modified to grant interest-only payments on amortizing loans.  Management performs a discounted cash flow calculation to determine the amount of impaired reserve required on each of the troubled debt restructures.  Any reserve is recorded through the provision for loan losses.

The following is a summary of troubled debt restructurings that have subsequently defaulted within one year of modification during the year ended June 30, 2012.

	Number of		Recorded
	Contracts		Investment
	(Dollars in thousands)
Real estate:
Residential		2	$	229
Commercial		1		224
		3	$	453

The defaults on the residential and commercial loans were the result of the borrower’s delinquent loan payments.  As of June 30, 2012, the commercial loan was current, one residential loan was current and the other was past due greater than 90 days and placed on non-accrual.

At June 30, 2012, $567,000 in additional funds are committed to be advanced in connection with TDR’s.

Loans serviced for others are not included in the accompanying consolidated balance sheets.  The unpaid principal balances of mortgage and other loans serviced for others were $30,542,000 and $32,277,000 at June 30, 2012 and 2011, respectively.  A portion of these loans were sold with certain recourse provisions, and at June 30, 2012 the related maximum contingent liability amounted to $445,000 which is not recorded in the consolidated financial statements.  The Company has evaluated mortgage servicing rights related to loans sold with servicing retained and due to their immaterial amount, has not recorded a servicing asset.

Certain directors and executive officers of the Company and companies in which they have significant ownership interest were customers of the Bank during the year ended June 30, 2012 and 2011.  Total loans to such persons and their companies amounted to $61,000 and $80,000 as of June 30, 2012 and 2011, respectively.  During the year ended June 30, 2012 and 2011, principal payments totaled $19,000 and $17,000, and principal advances totaled $0 and $25,000, respectively.

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PREMISES AND EQUIPMENT

12 Months Ended

Jun. 30, 2012

Property, Plant and Equipment [Abstract]

PREMISES AND EQUIPMENT

5.             PREMISES AND EQUIPMENT

The following is a summary of premises and equipment as of June 30:

	2012			2011
	(In thousands)
Land	$	470		$	470
Buildings		6,270			6,266
Equipment		2,770			2,769
		9,510			9,505
Accumulated depreciation and amortization		(4,984	)		(4,656	)
Premises and equipment, net	$	4,526		$	4,849

Depreciation expense amounted to $393,000 and $496,000 for the years ended June 30, 2012 and 2011, respectively.

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DEPOSITS

12 Months Ended

Jun. 30, 2012

Deposit Liabilities [Abstract]

DEPOSITS

7. DEPOSITS

The balances and the rates at which the Company paid interest on deposit accounts at June 30, were as follows:

	2012					2011
	Amount		Weighted Average Rate			Amount		Weighted Average Rate
	(Dollars in thousands)
Demand deposits	$	43,785		-	%	$	36,814		-	%
NOW accounts		92,662		0.67			92,273		0.81
Regular savings		54,495		0.21			50,283		0.34
Money market accounts		16,668		0.48			13,474		0.68
Club accounts		256		0.15			245		0.30
		207,866		0.39			193,089		0.52
Certificate accounts maturing in:
Less than one year		60,699		1.28			71,200		1.84
One to two years		30,251		2.64			24,112		2.43
Two to three years		18,439		2.59			22,182		3.25
Three to five years		25,083		2.29			23,190		2.91
		134,472		1.96			140,684		2.34
Total deposits	$	342,338		1.01	%	$	333,773		1.29	%

The aggregate amount of time deposit accounts in denominations of $100,000 or more as of June 30, 2012 and 2011 was $62,390,000 and $64,650,000, respectively.

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PREMISES AND EQUIPMENT - Summary of Premises and Equipment (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Jun. 30, 2011
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 9,510	$ 9,505
Accumulated depreciation and amortization	(4,984)	(4,656)
Premises and equipment, net	4,526	4,849
Land
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	470	470
Buildings
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	6,270	6,266
Equipment
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 2,770	$ 2,769

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OFF-BALANCE SHEET FINANCIAL INSTRUMENTS - Summary of Notional amounts of commitments with off-balance-sheet credit risk (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Jun. 30, 2011
Line of Credit Facility [Line Items]
Unadvanced portions of loans: Outstanding commitments	$ 18,737	$ 17,961
Commitments to originate loans
Line of Credit Facility [Line Items]
Unadvanced portions of loans: Outstanding commitments	3,646	2,966
Construction loans
Line of Credit Facility [Line Items]
Unadvanced portions of loans: Outstanding commitments	1,559	1,476
Lines of credit
Line of Credit Facility [Line Items]
Unadvanced portions of loans: Outstanding commitments	12,690	12,737
Letters of credit
Line of Credit Facility [Line Items]
Unadvanced portions of loans: Outstanding commitments	$ 842	$ 782

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GOODWILL AND INTANGIBLE ASSETS - Summary of Goodwill and Intangible Assets (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Jun. 30, 2011
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill	$ 6,912	$ 6,912
Core deposit intangible	202	324
Total intangible assets	$ 7,114	$ 7,236

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LOANS (Details Textuals 1) (Loans receivables, USD $)	6 Months Ended		12 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2011 Residential Real Estate Loans_Receivables
Financing Receivable, Recorded Investment, Past Due [Line Items]
Number of residential estate greater than 90 days past due and still accruing interest			1
Financing Receivable, Recorded Investment, 90 Days Past Due and Still Accruing			$ 32,000
Impaired troubled debt restructurings	$ 8,237,000	$ 5,682,000

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BENEFIT PLANS (Details Textuals 1) (USD $)	0 Months Ended	12 Months Ended
	Oct. 04, 2004 Installments	Jun. 30, 2012	Jun. 30, 2011
Compensation and Retirement Disclosure [Abstract]
Cost Recognized		$ 158,000	$ 231,000
Percentage of contribution an employee's deferral		25.00%	25.00%
Percentage of employee's salary		4.00%	4.00%
Contributuion from employer		33,000	33,000
Description of 401(k) Plan		The Bank has a 401(k) plan covering each eligible employee.  Employees must be 21 years of age, work at least 1,000 hours per year, and have at least one year of service with the Bank to be eligible to participate.
Total liability for the arrangements included in other liabilities		162,000	109,000
Expenses under other postretirement benefit plan		53,000	6,000
Number of share purchased	257,062
Amount borrowed by ESOP for purchase of shares	2,600,000
Interest rate	4.75%
Number of substantial equal annual installments	20
Amount of ESOP expenses		60,000	57,000
Number of shares allocated		100,513	87,734
Number of shares unreleased		156,549	169,328
Fair Value of shares unreleased		$ 654,000	$ 879,000

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INCOME TAXES (Tables)

12 Months Ended

Jun. 30, 2012

Income Tax Disclosure [Abstract]

Schedule of the components of income tax expense (benefit)

	2012		2011
	(In thousands)
Current:
Federal	$	18	$	723
State		2		1
Total current		20		724
Deferred:
Federal		195		(187	)
State		-		-
Total deferred		195		(187	)
Income tax expense	$	215	$	537

Schedule of the summary of differences between the statutory federal income tax rate and the effective tax rates

	2012			2011
	(In thousands)
Federal income tax at statutory rates	$	430		$	556
Increase (decrease) in tax resulting from:
State taxes, net of federal benefit		1			1
Qualifying option (benefit) expense		(3	)		9
Dividends received deduction		(112	)		(113	)
Bank-owned life insurance		(111	)		(138	)
Tax-exempt municipal income, net		(14	)		(14	)
Expiration unused contributions		-			92
Other, net		24			144
Income tax expense	$	215		$	537
Effective tax rates		17.0	%		32.8	%

Schedule of gross deferred tax assets and gross deferred tax liabilities

	2012			2011
	(In thousands)
Deferred tax assets:
Allowance for loan losses	$	918		$	985
Net unrealized holding loss on available-for-sale securities		521			652
Deferred compensation		188			190
Stock-based compensation		64			59
Impairment losses on securities available-for-sale		1,093			1,769
Accrued expenses		159			-
Post retirement benefits		55			37
Interest receivable on non-accrual loans		168			134
Federal carryovers		1,516			1,043
Other		68			42
Gross deferred tax asset		4,750			4,911
Deferred tax liabilities:
Depreciation and amortization		(703	)		(630	)
Deferred loan costs		(157	)		(65	)
Gross deferred tax liability		(860	)		(695	)
Net deferred tax asset	$	3,890		$	4,216

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INVESTMENT SECURITIES - Summary of significant assumptions used in valuation of non-agency mortgage-backed securities (Details 5)	12 Months Ended
	Jun. 30, 2012
Maximum
Schedule Of Available-For-Sale Securities and Held-To-Maturity Securities [Line Items]
Prepayment rates	31.10%
Default rates	32.80%
Loss severity	37.90%
Minimum
Schedule Of Available-For-Sale Securities and Held-To-Maturity Securities [Line Items]
Prepayment rates	0.00%
Default rates	5.60%
Loss severity	10.00%
Weighted Average
Schedule Of Available-For-Sale Securities and Held-To-Maturity Securities [Line Items]
Prepayment rates	18.20%
Default rates	21.50%
Loss severity	33.00%

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OFF-BALANCE SHEET FINANCIAL INSTRUMENTS

12 Months Ended

Jun. 30, 2012

Off Balance Sheet Financial Instruments [Abstract]

OFF-BALANCE SHEET FINANCIAL INSTRUMENTS

12.          OFF-BALANCE SHEET FINANCIAL INSTRUMENTS

The Company is party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers.  These financial instruments include commitments to originate loans, standby letters of credit and unadvanced funds on loans.  The instruments involve, to varying degrees, elements of credit risk in excess of the amount recognized in the consolidated balance sheets.  The contract amounts of those instruments reflect the extent of involvement the Company has in particular classes of financial instruments.

The Company’s exposure to credit loss in the event of non-performance by the other party to the financial instrument for loan commitments is represented by the contractual amounts of those instruments.  The Company uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments.

Commitments to originate loans are agreements to lend to a customer provided there is no violation of any condition established in the contract.  Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee.  Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements.  The Company evaluates each customer’s creditworthiness on a case-by-case basis.  The amount of collateral obtained, if deemed necessary by the Company upon extension of credit, is based on management’s credit evaluation of the borrower.  Collateral held varies, but may include secured interests in mortgages, accounts receivable, inventory, property, plant and equipment and income-producing properties.

Standby letters of credit are conditional commitments issued by the Company to guarantee the performance by a customer to a third party.  The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers.  As of June 30, 2012 and 2011, the maximum potential amount of the Company’s obligation was $842,000 and $782,000, respectively, for financial and standby letters of credit.  The Company’s outstanding letters of credit generally have a term of less than one year.  If a letter of credit is drawn upon, the Company may seek recourse through the customer’s underlying line of credit.  If the customer’s line of credit is also in default, the Company may take possession of the collateral, if any, securing the line of credit.

Notional amounts of commitments with off-balance-sheet credit risk are as follows as of June 30:

	2012		2011
	(In thousands)
Commitments to originate loans	$	3,646	$	2,966
Unadvanced portions of loans:
Construction loans		1,559		1,476
Lines of credit		12,690		12,737
Letters of credit		842		782
Outstanding commitments	$	18,737	$	17,961

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

12 Months Ended

Jun. 30, 2012

Accounting Policies [Abstract]

Use of Estimates

Use of Estimates

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change are the allowance for loan losses, other-than-temporary impairment of securities, the valuation of goodwill and the valuation of deferred tax assets.

Basis of Presentation

Basis of Presentation

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, the Bank, and the Bank’s wholly owned subsidiaries, Windham North, LLC, PSB Realty, LLC and Putnam Bank Mortgage Servicing Company. All significant intercompany accounts and transactions have been eliminated in the consolidation.

Cash and Cash Equivalents

Cash and Cash Equivalents

For the purposes of reporting cash flows, cash and cash equivalents include cash, amounts due from depository institutions and interest-bearing deposits with other banks.

Cash and due from banks as of June 30, 2012 and 2011 includes $5,650,000, which is subject to withdrawals and usage restrictions to satisfy the reserve requirements of the Federal Reserve Bank, target balances at Bankers Bank Northeast and for other purposes.

Cash is maintained in bank accounts which, at times may exceed insured limits. The Company has not experienced any issues in such accounts and does not believe it is exposed to any significant credit risk on cash.

Securities

Securities

Investments in debt securities are adjusted for amortization of premiums and accretion of discounts computed so as to approximate the interest method. Gains or losses on sales of investment securities are computed on a specific identification basis. All security transactions are recorded on the trade date.

The Company classifies debt and equity securities into one of three categories: held-to-maturity, available-for-sale, or trading. These security classifications may be modified after acquisition only under certain specified conditions. In general, securities may be classified as held-to-maturity only if the Company has the positive intent and ability to hold them to maturity. Trading securities are defined as those bought and held principally for the purpose of selling them in the near term. All other securities must be classified as available-for-sale.

Held-to-maturity securities are measured at amortized cost in the consolidated balance sheets. Unrealized holding gains and losses are not included in earnings or in other comprehensive income/loss. They are disclosed in the notes to the consolidated financial statements.

Available-for-sale securities are carried at fair value on the consolidated balance sheets. Unrealized holding gains and losses are not included in earnings but are included in other comprehensive income/loss, net of applicable taxes.

Trading securities are carried at fair value on the consolidated balance sheets. Unrealized holding gains and losses for trading securities are included in earnings. The Company held no securities classified as trading at June 30, 2012 and 2011.

Each reporting period, the Company evaluates all securities classified as available-for-sale or held-to-maturity, with a decline in fair value below the amortized cost of the investment to determine whether or not the impairment is deemed to be other-than-temporary (“OTTI”).

OTTI is required to be recognized if (1) the Company intends to sell the security; (2) it is “more likely than not” that the Company will be required to sell the security before recovery of its amortized cost basis; or (3) for debt securities, the present value of expected cash flows is not sufficient to recover the entire amortized cost basis. Marketable equity securities are evaluated for OTTI based on the severity and duration of the impairment and, if deemed to be other than temporary, the declines in fair value are reflected in earnings as realized losses. For impaired debt securities that the Company intends to sell, or more likely than not will be required to sell, the full amount of the depreciation is recognized as OTTI through earnings. For all other impaired debt securities, credit-related OTTI is recognized through earnings and non-credit related OTTI is recognized in other comprehensive income/loss, net of applicable taxes.

Federal Home Loan Bank of Boston Stock, at Cost

Federal Home Loan Bank of Boston Stock, at Cost

The Bank, as a member of the Federal Home Loan Bank (“FHLB”) system, is required to maintain an investment in capital stock of the FHLB of Boston. Based on redemption provisions, the stock has no quoted market value and is carried at cost. At its discretion, the FHLB of Boston may declare dividends on the stock. The Bank reviews for impairment based on the ultimate recoverability of the cost basis in the stock. As of June 30, 2012, no impairment has been recognized.

Loans Held-For-Sale

Loans Held-For-Sale

Loans originated and intended for sale in the secondary market are carried at the lower of cost or estimated fair value in the aggregate. Net unrealized losses, if any, are provided for in a valuation allowance by charges to income.

Interest income on loans held-for-sale is accrued currently and classified as interest on loans.

Loans

Loans

The Company’s loan portfolio includes residential real estate, commercial real estate, residential construction, commercial and consumer/other segments. Loans that management has the intent and ability to hold for the foreseeable future or until maturity or pay-off generally are reported at their outstanding unpaid principal balances adjusted for charge-offs, the allowance for loan losses, and any deferred fees or costs on originated loans. Interest income is accrued on the unpaid principal balance. Loan origination fees, net of certain direct origination costs, are deferred and recognized as an adjustment of the related loan yield using the interest method.

The accrual of interest on all loans is discontinued at the time the loan is 90 days past due unless the credit is well-secured and in process of collection.  Past due status is based on contractual terms of the loan.  In all cases, loans are placed on nonaccrual if collection of principal or interest is considered doubtful.  All interest accrued but not collected for loans that are placed on nonaccrual is reversed against interest income.  The interest on these loans is accounted for on the cash-basis or cost-recovery method, until qualifying for return to accrual.  Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured.

Allowance for Loan Losses

Allowance for Loan Losses

The allowance for loan losses is established as losses are estimated to have occurred through a provision for loan losses charged to earnings. Loan losses are charged against the allowance when management believes the uncollectability of a loan balance is confirmed.

The allowance for loan losses is evaluated on a quarterly basis by management. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available. The allowance consists of general, specific and unallocated components, as further described below.

General component

The general component of the allowance for loan losses is based on historical loss experience adjusted for qualitative factors stratified by the following loan segments: residential real estate, commercial real estate, residential construction, commercial and consumer/other. Management uses a rolling average of historical losses based on a time frame appropriate to capture relevant loss data for each loan segment. This historical loss factor is adjusted for the following qualitative factors: levels/trends in delinquencies; loan concentrations, trends in volume and terms of loans; changes in lending practices and procedures; changes in lending management and staff; changes in the value of underlying collateral; changes in the quality of the loan review system; national and local economic trends and conditions and the effects of other external factors. During the year ended June 30, 2012, the Company changed the allowance for loan loss calculation to add certain qualitative factors and amend loan segment characterization, resulting in a change in accounting estimate. Qualitative factors were added for changes in lending practices and procedures; changes in the value of underlying collateral; changes in lending management and staff; changes in the quality of the loan review system and the effects of other external factors. In addition, loan segments within the allowance were amended to correspond to call report requirements. These changes did not quantitatively impact the dollar amount of the allowance for loan losses at June 30, 2012, as changes relate only to qualitative assessments and methodology in how the allowance is calculated.

The qualitative factors are determined based on the various risk characteristics of each loan segment. Risk characteristics relevant to each portfolio segment are as follows:

Residential real estate - The Company generally does not originate loans with a loan-to-value ratio greater than 80% and does not originate subprime loans. All loans in this segment are collateralized by owner-occupied residential real estate and repayment is dependent on the credit quality of the individual borrower. The overall health of the economy, including unemployment rates and housing prices, will have an effect on the credit quality in this segment.

Commercial real estate - Loans in this segment are primarily income-producing properties throughout New England. The underlying cash flows generated by the properties are adversely impacted by a downturn in the economy as evidenced by increased vacancy rates, which in turn, will have an effect on the credit quality in this segment. Management obtains rent rolls annually and continually monitors the cash flows of these loans.

Residential construction – Loans in this segment primarily include speculative real estate development loans for which payment is derived from sale of the property. Credit risk is affected by cost overruns, time to sell at an adequate price, and market conditions.

Commercial – Loans in this segment are made to businesses and are generally secured by assets of the business. Repayment is expected from the cash flows of the business. A weakened economy, and resultant decreased consumer spending, will have an effect on the credit quality in this segment.

Consumer/other - Loans in this segment are generally secured and repayment is dependent on the credit quality of the individual borrower.

Specific component

The specific component relates to loans that are classified as impaired. Impairment is measured on a loan by loan basis by either the present value of expected future cash flows discounted at the loan’s effective interest rate or the fair value of the collateral if the loan is collateral dependent or foreclosure is probable. An allowance is established when the discounted cash flows (or collateral value) of the impaired loan is lower than the carrying value of that loan. Large groups of smaller balance homogeneous loans are collectively evaluated for impairment. Accordingly, the Company does not separately identify individual consumer and residential real estate loans for impairment disclosures, unless such loans are subject to a troubled debt restructuring (“TDR”) agreement.

A loan is considered impaired when, based on current information and events, it is probable that the Company will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. Factors considered by management in determining impairment include payment status, collateral value, and the probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant payment delays and payment shortfalls generally are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record, and the amount of the shortfall in relation to the principal and interest owed.

The Company periodically may agree to modify the contractual terms of loans. When a loan is modified and a concession is made to a borrower experiencing financial difficulty, the modification is considered a troubled debt restructuring. All TDRs are initially classified as impaired.

Unallocated component

An unallocated component is maintained to cover uncertainties that could affect management’s estimate of probable losses. The unallocated component of the allowance reflects the margin of imprecision inherent in the underlying assumptions used in the methodologies for estimating specific and general reserves in the portfolio.

Premises and Equipment

Premises and Equipment

Premises and equipment are stated at cost, less accumulated depreciation and amortization. Cost and related allowances for depreciation and amortization of premises and equipment retired or otherwise disposed of are removed from the respective accounts with any gain or loss included in income or expense. Depreciation and amortization are calculated principally on the straight-line method over the estimated useful lives of the assets or term of lease if shorter. Estimated lives are 5 to 40 years for buildings and premises, 3 to 20 years for furniture, fixtures and equipment and lease terms range from 1 to 25 years. Expenditures for replacements or major improvements are capitalized; expenditures for normal maintenance and repairs are charged to expense as incurred.

Other Real Estate Owned

Other Real Estate Owned

Other real estate owned includes properties acquired through foreclosure and properties classified as in-substance foreclosures. These properties are carried at the lower of cost or estimated fair value less estimated costs to sell. Any write-down from cost to estimated fair value required at the time of foreclosure or classification as in-substance foreclosure is charged to the allowance for loan losses. Expenses incurred in connection with maintaining these assets, subsequent write-downs and gains or losses recognized upon sale are charged to expense.

Goodwill

Goodwill

Goodwill is measured as the excess of the cost of a business acquisition over the sum of the amounts assigned to identifiable tangible and intangible assets acquired less liabilities assumed. Goodwill is not amortized but is reviewed for impairment annually or more frequently if circumstances warrant. The goodwill impairment analysis is a two-step test.

The first step (“Step 1”) is used to identify potential impairment, and involves comparing the reporting unit’s (the consolidated Company, in our case) estimated fair value to its carrying amount, including goodwill. If the estimated fair value of the reporting unit exceeds its carrying amount, goodwill is not deemed to be impaired. Should the carrying amount of the reporting unit exceed its estimated fair value, an indicator of impairment is deemed to exist and a second step is performed to measure the amount of such impairment, if any. The second step (“Step 2”) involves calculating the implied fair value of goodwill. The implied fair value of goodwill is determined in a manner similar to how the amount of goodwill is determined in a business combination (i.e. by measuring the excess of the

estimated fair value, as determined in Step 1, over the aggregate estimated fair values of the individual assets, liabilities, and identifiable intangibles as of the impairment testing date). If the implied fair value of goodwill exceeds the carrying amount of goodwill assigned to the reporting unit, no impairment exists. If the carrying amount of goodwill exceeds the implied fair value of the goodwill, an impairment loss is recorded in an amount equal to such excess. An impairment loss cannot exceed the carrying amount of goodwill, and the loss (write-down) establishes a new carrying amount for the goodwill. Subsequent reversal of goodwill impairment losses is not permitted. Application of the goodwill impairment test requires significant judgments including estimation of future cash flows, which are dependent on internal forecasts, estimation of the long-term rate of growth, the period over which cash flows will occur, and determination of our cost of capital. Changes in these estimates and assumptions could materially affect the determination of fair value and/or conclusions related to goodwill impairment. For the year ended June 30, 2012, the Company had no goodwill impairment.

Bank-owned Life Insurance

Bank-owned Life Insurance

Bank-owned life insurance policies are reflected on the consolidated balance sheet at cash surrender value. Changes in the net cash surrender value of the policies, as well as insurance proceeds received, are reflected in non-interest income on the consolidated statement of income and are not subject to income taxes.

Fair Value of Financial Instruments

Fair Value of Financial Instruments

The Company uses fair value measurements to record fair value adjustments to certain assets and to determine fair value disclosures. Fair value methods and assumptions used by the Company in estimating its fair value disclosures are as follows:

Cash and Cash Equivalents: The carrying amounts of cash and cash equivalents approximate fair values based on the short-term nature of the assets.

Investment Securities and FHLB Stock: As of June 30, 2012, all fair value measurements on investment securities are obtained from a third party pricing source and are not adjusted by management.The fair value of securities to be held-to-maturity and available-for-sale is estimated based on quoted market prices, where available. If quoted market prices are not available, fair values are based on quoted market prices of comparable instruments. Ownership of FHLB of Boston stock is restricted to member banks; therefore, the stock is not traded. The estimated fair value of FHLB of Boston stock is equal to its carrying value, which represents the price at which the FHLB of Boston is obligated to redeem its stock.

Loans, net: For valuation purposes, the loan portfolio was segregated into its significant categories, which are residential real estate, commercial real estate, residential construction, commercial and consumer/other loans. These categories were further segregated, where appropriate, into components based on significant financial characteristics such as type of interest rate (fixed or adjustable). Fair values were estimated for each component using assumptions developed by management and a valuation model provided by a third party specialist.

The fair values of residential real estate, commercial real estate, residential construction, commercial and consumer and other loans were estimated by discounting the anticipated cash flows from the respective portfolios. Estimates of the timing and amount of these cash flows considered factors such as future loan prepayments. The discount rates reflected current market rates for loans with similar terms to borrowers of similar credit quality. The fair value of home equity lines of credit was based on the outstanding loan balances. Fair values for non-performing loans are estimated using discounted cash flow analyses or underlying collateral values, where applicable.

Loans held for sale: Loans held for sale are accounted for at the lower of cost or market and the fair value of loans held for sale are based on quoted market prices of similar loans sold in conjunction with securitization transactions, adjusted as required for changes in loan characteristics.

Accrued interest: The carrying amounts of accrued interest approximate fair value.

Deposits and Mortgagors’ Escrow: The fair value of deposits with no stated maturity such as demand deposits, NOW, regular savings, and money market deposit accounts, and mortgagors’ escrow accounts, is equal to the amount payable on demand. The fair value estimates do not include the benefit that results from the generally lower cost of funding provided by the deposit liabilities compared to the cost of borrowing funds in the market. The fair value estimate of time deposits is based on the discounted value of contractual cash flows. The discount rate is estimated using market rates currently offered for deposits having similar remaining maturities.

Federal Home Loan Bank Advances: The fair values of the Company’s Federal Home Loan Bank advances are estimated using discounted cash flow analyses based on the current incremental borrowing rates in the market for similar types of borrowing arrangements.

Securities Sold Under Agreements to Repurchase: The Company enters into overnight repurchase agreements with its customers. Since these agreements are short-term instruments, the fair value of these agreements approximates their recorded balance. The fair value of these agreements are determined by discounting the anticipated future cash payments using rates currently available to the Bank for debt with similar terms and remaining maturities.

Off-Balance Sheet Instruments: The fair value of off-balance-sheet mortgage lending commitments are based on fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements and the counterparties’ credit standing. In the case of the commitments discussed in Note 12, the fair value equals the carrying amounts which are not significant.

Earnings per Share (EPS)

Earnings per Share (EPS)

Basic earnings per share represents income available to common stockholders divided by the weighted-average number of common shares outstanding during the period. If rights to dividends on unvested options/awards are non-forfeitable, these unvested awards/options are considered outstanding in the computation of basic earnings per share. Diluted earnings per share reflects additional common shares that would have been outstanding if dilutive potential common shares had been issued, as well as any adjustment to income that would result from the assumed issuance. Potential common shares that may be issued by the Company relate to outstanding stock options and restricted stock awards and are determined using the treasury stock method.

Treasury shares and unallocated ESOP shares are not deemed outstanding for earnings per share calculations.

Earnings per share have been computed based on the following:

	Income			Shares		Per-Share
	(Numerator)			(Denominator)		Amount
Year ended June 30, 2012:
Basic EPS:
Net income	$	1,050,000
Net income and income allocated to common stockholders		1,050,000			6,364,345
Basic EPS						$	0.16
Diluted EPS:
Effect of dilutive securities options					-
Diluted EPS	$	1,050,000			6,364,345	$	0.16
Year ended June 30, 2011:
Basic EPS:
Net income	$	1,098,000
Dividends and undistributed earnings allocated to unvested shares		(2,000	)
Net income and income allocated to common stockholders		1,096,000			6,342,473	$	0.17
Effect of dilutive securities options and warrants					N/A
Diluted EPS:
Income attributable to common stockholders and assumed conversions	$	1,096,000			6,342,473	$	0.17

At June 30, 2012, options for 222,921 shares were not included in the computation of earnings per share as the effects were anti-dilutive.

Transfers of Financial Assets

Transfers of Financial Assets

Transfers of an entire financial asset, a group of entire financial assets, or a participating interest in an entire financial asset are accounted for as sales when control over the assets has been surrendered. Control over transferred assets is deemed to be surrendered when (1) the assets have been isolated from the Company, (2) the transferee obtains the right to pledge or exchange the transferred assets, and (3) the Company does not maintain effective control over the transferred assets.

Advertising

Advertising

The Company directly expenses costs associated with advertising as they are incurred.

Income Taxes

Income Taxes

Deferred income tax assets and liabilities are determined using the liability (or balance sheet) method. Under this method, the net deferred tax asset or liability is determined based on the tax effects of the temporary differences between the book and tax basis of the various balance sheet assets and liabilities and gives current recognition to changes in tax rates and laws. A valuation allowance is established against deferred tax assets when, based upon the available evidence including historical and projected taxable income, it is more likely than not that some or all of the deferred tax assets will not be realized.

Income tax benefits related to stock compensation in excess of grant date fair value less any proceeds on exercise are recognized as an increase to additional paid-in capital upon vesting or exercising and delivery of the stock. Any income tax effects related to stock compensation that are less than grant date fair value less any proceeds on exercise would be recognized as a reduction of additional paid in capital to the extent of previously recognized income tax benefits and then through income tax expense for the remaining amount.

Employee Benefit Plans

Employee Benefit Plans

The Company established an Employee Stock Ownership Plan (the ESOP) as part of its minority stock issuance on October 4, 2004. The ESOP is accounted for in accordance with Accounting Standards Codification (“ASC”) 718-40, “Compensation - Stock Compensation - Employee Stock Ownership Plan.” Under ASC 718-40, unearned ESOP shares are not considered outstanding and are therefore not taken into account when computing earnings per share. Unearned ESOP shares are presented as a reduction to stockholders’ equity and represent shares to be allocated to ESOP participants in future periods for services provided to the Company. As shares are committed to be released, compensation expense is recognized for the fair market value of the stock and stockholders’ equity is increased by a corresponding amount. The loan to the ESOP will be repaid principally from the Bank’s contributions to the ESOP and dividends payable on common stock held by ESOP over a period of 20 years.

As more fully described in Note 14, the Company has a stock-based incentive plan authorizing various types of incentive awards that may be granted to directors, officers and employees. The Company accounts for the plan under ASC 718-10, “Compensation - Stock Compensation - Overall.” In accordance with ASC 718-10, the Company records share-based compensation expense related to outstanding stock option and restricted stock awards based upon the fair value at the date of grant over the vesting period of such awards on a straight-line basis. During the years ended June 30, 2012 and 2011, $24,000 and $121,000, respectively, in stock-based employee compensation was recognized.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In April 2011, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2011-02, Receivables (Topic 310), A Creditor’s Determination of Whether a Restructuring Is a Troubled Debt Restructuring.  This update provides additional guidance and clarification to help creditors in determining whether a creditor has granted a concession and whether a debtor is experiencing financial difficulties for purposes of determining whether a restructuring constitutes a troubled debt restructuring (“TDR”).  This update is effective for the first interim or annual period beginning on or after June 15, 2011, with retrospective application to the beginning of the annual period of adoption.  The measurement of impairment should be done prospectively in the period of adoption for loans that are newly identified as TDRs upon adoption of this update.  In addition, the TDR disclosures required by ASU 2010-20, Receivables (Topic 310), Disclosures about the Credit Quality of Financing Receivables and the Allowance for Credit Losses should be provided beginning in the period of adoption of this update.  This guidance was adopted by the Company as of July 1, 2011 and did not have a material impact on the Company’s consolidated financial statements.

In April 2011, the FASB issued ASU 2011-03, Transfers and Servicing (Topic 860), Reconsideration of Effective Control for Repurchase Agreements.  This update removes from the assessment of effective control for repurchase agreements (1) the criterion used to assess effective control relating to the transferor’s ability to repurchase or redeem financial assets even in the event of a default by the transferee and (2) the collateral maintenance implementation guidance related to that criterion.  This update is effective for the first interim or annual period beginning on or after December 15, 2011 and should be applied prospectively to transactions or modifications of existing transactions that occur on or after the effective date.  This guidance was adopted by the Company as of January 1, 2012, and did not have a material impact on the Company’s consolidated financial statements.

In May 2011, the FASB issued ASU 2011-04, Fair Value Measurement (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRS.  This update clarifies and expands the disclosures pertaining to unobservable inputs in Level 3 fair value measurements.  The guidance also requires, for public companies, disclosure of the level within the fair value hierarchy for assets and liabilities not measured at fair value in the statement of financial position but for which the fair value is disclosed.  The amendments in this update are to be applied prospectively.  For public entities, the amendments are effective during interim and annual periods beginning after December 15, 2011.  This guidance was adopted by the Company as of January 1, 2012, and did not have a material impact on the Company’s consolidated financial statements.

In June 2011, the FASB issued ASU 2011-05, Comprehensive Income (Topic 220), Presentation of Comprehensive Income.  This update amends the disclosure requirements for the presentation of comprehensive income.  The amended guidance eliminates the option to present components of other comprehensive income (OCI) as part of the statement of changes in stockholder’s equity.  Under the amended guidance, all changes in OCI are to be presented either in a single continuous statement of comprehensive income or in two separate but consecutive financial statements.  The changes, as modified by ASU 2011-12, are effective for fiscal years, and interim periods within those years, beginning after December 15, 2011, although early application is permitted.  In December 2011, the FASB issued ASU 2011-12 to defer changes that relate to the presentation of reclassification adjustments but the other requirements of ASU 2011-05 remain in effect.  This amendment will be effective for the Company for annual and interim periods beginning July 1, 2012 and is not expected to have a material impact on the Company’s consolidated financial statements.

In September 2011, the FASB issued ASU 2011-08, Intangibles – Goodwill and Other (Topic 350), Testing Goodwill for Impairment.  This update is intended to reduce the complexity and cost of performing an evaluation of impairment of goodwill.  Under the new guidance, an entity will have the option of first assessing qualitative factors (events and circumstances) to determine whether it is more likely than not (meaning a likelihood of more than 50 percent) that the fair value of a reporting unit is less than its carrying amount.  If, after considering all relevant events and circumstances, an entity determines it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the two-step impairment test will be unnecessary.  The amendments will be effective for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 2011.  This amendment will be effective for the Company for annual and interim periods beginning July 1, 2012 and is not expected to have a material impact on the Company’s consolidated financial statements.

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PARENT COMPANY ONLY FINANCIAL STATEMENTS - Statements of Income (Details 1) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Condensed Financial Statements, Captions [Line Items]
Interest on loan	$ 12,964	$ 13,694
Total interest and dividend income	17,738	19,730
Interest expense	6,655	8,370
Other expense	1,317	1,220
Income tax expense	215	537
Net income	1,050	1,098
PSB Holdings, Inc.
Condensed Financial Statements, Captions [Line Items]
Interest and dividends on investments	20	26
Interest on loan	63	67
Total interest and dividend income	83	93
Interest expense
Net interest and dividend income	83	93
Other expense	220	183
Loss before income tax (benefit) expense and equity in undistributed net income of subsidiary	(137)	(90)
Income tax expense	(56)	71
Loss before equity in undistributed net income of subsidiary	(81)	(161)
Equity in undistributed net income of subsidiary	(1,131)	(1,259)
Net income	$ 1,050	$ 1,098

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INVESTMENT SECURITIES - Summary of aggregate fair value and unrealized losses of securities that have been in continuous unrealized loss position for less than twelve months and for twelve months or more (Details 3) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Jun. 30, 2012		Jun. 30, 2011
Schedule Of Available-For-Sale Securities and Held-To-Maturity Securities [Line Items]
Total other-than-temporary impairment losses	$ 3,522		$ 3,037
Less: unrealized other-than-temporary losses recognized in accumulated other comprehensive income/loss	1,558	[1]	1,972	[1]
Net impairment losses recognized in earnings (2)	1,964	[2]	1,065	[2]
Corporate bonds and other securities
Schedule Of Available-For-Sale Securities and Held-To-Maturity Securities [Line Items]
Total other-than-temporary impairment losses
Less: unrealized other-than-temporary losses recognized in accumulated other comprehensive income/loss		[1]		[1]
Net impairment losses recognized in earnings (2)		[2]		[2]
Non-agency mortgage-backed securities
Schedule Of Available-For-Sale Securities and Held-To-Maturity Securities [Line Items]
Total other-than-temporary impairment losses	3,522		3,037
Less: unrealized other-than-temporary losses recognized in accumulated other comprehensive income/loss	1,558	[1]	1,972	[1]
Net impairment losses recognized in earnings (2)	1,964	[2]	1,065	[2]
Equity securities
Schedule Of Available-For-Sale Securities and Held-To-Maturity Securities [Line Items]
Total other-than-temporary impairment losses
Less: unrealized other-than-temporary losses recognized in accumulated other comprehensive income/loss		[1]		[1]
Net impairment losses recognized in earnings (2)		[2]		[2]

[1] Represents the non-credit component of the other-than-temporary impairment.

[2] Represents the credit component of the other-than-temporary impairment.

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NATURE OF OPERATIONS (Details Textuals)	Jun. 30, 2012	Jun. 30, 2011	Oct. 04, 2004 Putnam Bancorp MHC	Oct. 04, 2004 Eligible depositors and the Putnam Savings Bank Employee Stock Ownership Plan
Related Party Transaction [Line Items]
Percentage of common stock issued			53.72%	44.50%
Common stock, shares issued	6,943,125	6,943,125	3,729,846	6,943,125

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Consolidated Statements of Changes in Stockholders' Equity (USD $) In Thousands, unless otherwise specified	Common Stock	Additional Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive Loss		Unearned ESOP Shares	Unearned Stock Awards	Treasury Stock	Total
Balance at Jun. 30, 2010	$ 694	$ 30,633	$ 21,550	$ (2,776)	[1]	$ (1,821)	$ (212)	$ (4,213)	$ 43,855
Comprehensive income:
Net income			1,098		[1]				1,098
Net change in unrealized holding losses on available-for-sale securities, net of reclassification adjustments and tax effects				1,509	[1]				1,509
Comprehensive income					[1]				2,607
ESOP shares released		(71)			[1]	128			57
Stock-based compensation expense		32			[1]		196		228
Balance at Jun. 30, 2011	694	30,594	22,648	(1,267)		(1,693)	(16)	(4,213)	46,747
Comprehensive income:
Net income			1,050		[1]				1,050
Net change in unrealized holding losses on available-for-sale securities, net of reclassification adjustments and tax effects				254	[1]				254
Comprehensive income					[1]				1,304
ESOP shares released			(68)		[1]	128			60
Stock-based compensation expense		8			[1]		16		24
Balance at Jun. 30, 2012	$ 694	$ 30,602	$ 23,630	$ (1,013)		$ (1,565)		$ (4,213)	$ 48,135

[1] The June 30, 2012 and 2011 ending balances include $1,250,000 and $2,887,000, respectively, of pre-tax unrealized losses in which other-than-temporary impairment has been recognized.

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REGULATORY MATTERS - Summary of reconciliation of Company's total consolidated equity to capital amounts (Details 1) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2010
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items]
Capital under generally accepted accounting principles	$ 48,135	$ 46,747	$ 43,855
Adjustments:
Intangible Assets	(202)	(324)
Unrealized losses on available-for-sale securities	(2,983)	(4,310)
Tier 1 Capital	36,587	35,673
Allowance for loan losses	2,913	3,072
Total Risk-Based capital	39,523	36,465
Parent Company [Member]
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items]
Capital under generally accepted accounting principles	48,135	42,765
Adjustments:
Equity capital of PSB Holdings, Inc.	(3,985)
Intangible Assets	(6,279)	(6,551)
Disallowed deferred tax assets	(1,938)	(1,813)
Unrealized losses on available-for-sale securities	654	1,272
Tier 1 Capital	36,587	35,673
Allowance for loan losses	2,936	2,845
Deduction for low-level recourse and residual interests		(2,053)
Total Risk-Based capital	$ 39,523	$ 36,465

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NATURE OF OPERATIONS

12 Months Ended

Jun. 30, 2012

Accounting Policies [Abstract]

NATURE OF OPERATIONS

1.           NATURE OF OPERATIONS

PSB Holdings, Inc. (the “Company”) is a federally chartered holding company formed on May 27, 2003 for the purpose of acquiring all of the common stock of Putnam Bank (the “Bank”) concurrent with the Bank’s reorganization from a mutual savings institution to the mutual holding company form of organization. No shares were offered to the public as part of this reorganization.

On October 4, 2004, the Company completed a plan of stock issuance pursuant to which 44.5% of its common stock was sold to eligible depositors and the Putnam Savings Bank Employee Stock Ownership Plan (“ESOP”). The Company issued a total of 6,943,125 shares.

3,729,846 shares, representing 53.72% of total shares issued, were issued to Putnam Bancorp MHC in exchange for its ownership of the bank. The sole purpose of Putnam Bancorp MHC is to own a majority of the common stock of PSB Holdings, Inc.

As part of the stock issuance, the Bank established the ESOP, which purchased 257,062 shares of common stock. The ESOP borrowed the necessary funds from the Company. The Bank intends to make annual contributions adequate to meet the debt service requirements of the ESOP.

In connection with the stock offering the Company established The Putnam Savings Foundation and contributed 123,588 shares of common stock, representing 4% of shares sold to the public. The Foundation supports charities in the geographic area the Bank serves.

The Bank is a federally chartered savings bank and provides a full range of banking services to individual and small business customers located primarily in Connecticut. The Bank is subject to competition from other financial institutions throughout the region. There are no concentrations of credit to borrowers that have similar economic characteristics. The majority of the Company’s loan portfolio is comprised of loans collateralized by real estate located in the state of Connecticut.

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LOANS - Summary of past due and non-accrual loans (Details 4) (Loans receivables, USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Jun. 30, 2011
Financing Receivable, Recorded Investment, Past Due [Line Items]
30-59 Days Past Due	$ 522	$ 871
60-89 Days Past Due	162	735
90 days or greater	2,937	4,450
Total Past Due	3,621	6,056
Total non-accrual loans	8,384	6,387
Residential Real Estate
Financing Receivable, Recorded Investment, Past Due [Line Items]
30-59 Days Past Due	363	92
60-89 Days Past Due	162	247
90 days or greater	940	1,126
Total Past Due	1,465	1,465
Total non-accrual loans	3,985	1,752
Commercial Real Estate
Financing Receivable, Recorded Investment, Past Due [Line Items]
30-59 Days Past Due	159	629
60-89 Days Past Due		488
90 days or greater	1,573	3,324
Total Past Due	1,732	4,441
Total non-accrual loans	3,975	4,635
Residential construction
Financing Receivable, Recorded Investment, Past Due [Line Items]
30-59 Days Past Due
60-89 Days Past Due
90 days or greater	424
Total Past Due	424
Total non-accrual loans	424
Commercial
Financing Receivable, Recorded Investment, Past Due [Line Items]
30-59 Days Past Due		150
60-89 Days Past Due
90 days or greater
Total Past Due		150
Total non-accrual loans
Consumer and other
Financing Receivable, Recorded Investment, Past Due [Line Items]
30-59 Days Past Due
60-89 Days Past Due
90 days or greater
Total Past Due
Total non-accrual loans

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FAIR VALUE MEASUREMENTS - Changes in level 3 assets measured at fair value (Details 1) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Balance	$ 10,400	$ 8,457
Total gains or losses (realized/unrealized) included in earnings
Included in other comprehensive income	(764)	1,943
Principal payments on securities
Accretion of securities, net
Transfers out of Level 3
Balance	9,636	10,400
Available-for-sale securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Balance	10,400	8,457
Total gains or losses (realized/unrealized) included in earnings
Included in other comprehensive income	(764)	1,943
Principal payments on securities
Accretion of securities, net
Transfers out of Level 3
Balance	$ 9,636	$ 10,400

XML

GOODWILL AND INTANGIBLE ASSETS (Details Textuals) (USD $)	12 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Goodwill and Intangible Assets Disclosure [Abstract]
Amortization of core deposit intangible	$ 122,000	$ 149,000

XML

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

12 Months Ended

Jun. 30, 2012

Accounting Policies [Abstract]

Schedule of computation of earnings per share

	Income			Shares		Per-Share
	(Numerator)			(Denominator)		Amount
Year ended June 30, 2012:
Basic EPS:
Net income	$	1,050,000
Net income and income allocated to common stockholders		1,050,000			6,364,345
Basic EPS						$	0.16
Diluted EPS:
Effect of dilutive securities options					-
Diluted EPS	$	1,050,000			6,364,345	$	0.16
Year ended June 30, 2011:
Basic EPS:
Net income	$	1,098,000
Dividends and undistributed earnings allocated to unvested shares		(2,000	)
Net income and income allocated to common stockholders		1,096,000			6,342,473	$	0.17
Effect of dilutive securities options and warrants					N/A
Diluted EPS:
Income attributable to common stockholders and assumed conversions	$	1,096,000			6,342,473	$	0.17

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BORROWED FUNDS (Details Textuals) (Federal Home Loan Bank of Boston, USD $)	Jun. 30, 2012	Jun. 30, 2011
Federal Home Loan Bank of Boston
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items]
Loans with a principal balance, pledged to secure available borrowings from the FHLB	$ 84,992,000	$ 122,215,000
Line of credit with Federal Home Loan Bank of Boston	$ 2,354,000

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REGULATORY MATTERS (Tables)

12 Months Ended

Jun. 30, 2012

Commitments and Contingencies Disclosure [Abstract]

Schedule of Bank's actual capital amounts and ratios

	Actual					For Capital Adequacy Purposes					To Be Well Capitalized Under Prompt Corrective Action Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio
	(In thousands)
As of June 30, 2012:
Tangible Equity Capital (to Tangible Assets)	$	36,587		8.24	%	$	6,661		1.50	%		N/A		N/A
Tier 1 Capital (to Adjusted Total Assets)		36,587		8.24	%		17,763		4.00	%	$	22,204		5.00	%
Tier 1 Capital (to Risk-Weighted Assets)		36,587		15.15	%		9,661		4.00	%		14,491		6.00	%
Total Capital (to Risk-Weighted Assets)		39,523		16.36	%		19,322		8.00	%		24,152		10.00	%
As of June 30, 2011:
Tangible Equity Capital (to Tangible Assets)	$	35,673		7.68	%	$	6,967		1.50	%		N/A		N/A
Tier 1 Capital (to Adjusted Total Assets)		35,673		7.68	%		18,578		4.00	%	$	23,222		5.00	%
Tier 1 Capital (to Risk-Weighted Assets)		35,673		14.79	%		9,095		4.00	%		13,643		6.00	%
Total Capital (to Risk-Weighted Assets)		36,465		16.04	%		18,190		8.00	%		22,738		10.00	%

Schedule of reconciliation of the Company's total consolidated equity to the capital amounts for the Bank reflected

	June 30,
	2012
	(In thousands)
Total consolidated equity	$	48,135
Adjustments:
Equity capital of PSB Holdings, Inc.		(3,985	)
Intangible assets		(6,279	)
Disallowed deferred tax assets		(1,938	)
Unrealized losses on available-for-sale securities		654
Tier 1 Capital		36,587
Allowance for loan losses		2,936
Total Risk-Based capital	$	39,523

	2011
	(In thousands)
Capital under generally accepted accounting principles	$	42,765
Intangible Assets		(6,551	)
Disallowed deferred tax assets		(1,813	)
Unrealized losses on available-for-sale securities		1,272
Tier 1 Capital		35,673
Allowance for loan losses		2,845
Deduction for low-level recourse and residual interests		(2,053	)
Total Risk-Based capital	$	36,465

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FAIR VALUE MEASUREMENTS

12 Months Ended

Jun. 30, 2012

Fair Value Disclosures [Abstract]

FAIR VALUE MEASURMENTS

11.         FAIR VALUE MEASURMENTS

The Company groups its assets measured at fair value in three levels, based on the markets in which the assets are traded and the reliability of the assumptions used to determine fair value.

Level 1 – Valuation is based on quoted prices in active markets for identical assets. Valuations are obtained from readily available pricing sources for market transactions involving identical assets.

Level 2 – Valuation is based on observable inputs other than Level 1 prices, such as quoted prices for similar assets; quoted prices in 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.

Level 3 – Valuation is based on unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets. Level 3 assets include financial instruments whose value is determined using unobservable inputs to pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation.

A financial instrument’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. During the years ended June 30, 2012 and 2011, there were no significant transfers between level 1 and level 2 of the fair value hierarchy.

              Assets Measured at Fair Value on a Recurring Basis

The following summarizes assets measured at fair value for the period ending June 30.

	Fair Value Measurements at Reporting Date Using:
			Quoted Prices in		Significant		Significant
			Active Markets for		Other Observable		Unobservable
			Identical Assets		Inputs		Inputs
	Total		Level 1		Level 2		Level 3
	(In thousands)
June 30, 2012
Securities available-for-sale:
U. S. Government and government-sponsored securities	$	459	$	-	$	459	$	-
Corporate bonds and other securities		4,654		-		4,654		-
U.S. Government-sponsored and guaranteed mortgage-backed securities		24,113		-		24,113		-
Non-agency mortgage-backed securities		8,351		-		8,351		-
Equity securities		9,636		-		-		9,636
Total	$	47,213	$	-	$	37,577	$	9,636
	Fair Value Measurements at Reporting Date Using:
			Quoted Prices in		Significant		Significant
			Active Markets for		Other Observable		Unobservable
			Identical Assets		Inputs		Inputs
	Total		Level 1		Level 2		Level 3
	(In thousands)
June 30, 2011
Securities available-for-sale:
U. S. Government agency securities	$	666	$	-	$	666	$	-
Corporate securities		4,905		-		4,905		-
Mortgage-backed securities insured or guaranteed by U.S. Government enterprises		30,316		-		30,316		-
Non-agency mortgage-backed securities		11,722		-		11,722		-
Equity securities		10,400		-		-		10,400
Total	$	58,009	$	-	$	47,609	$	10,400

The table below represent the changes in Level 3 assets measured at fair value on a recurring basis for the years ended June 30, 2012 and 2011:

	Fair Value Measurements
	Using Significant Unobservable
	Inputs (Level 3)
	Available-for-sale
	Securities			Total
	(In thousands)
Beginning balance, July 1, 2010	$	8,457		$	8,457
Total gains or losses (realized/unrealized) included in other comprehensive income		1,943			1,943
Principal payments on securities		-			-
Accretion of securities, net		-			-
Transfers out of Level 3		-			-
Ending balance, June 30, 2011		10,400			10,400
Total gains or losses (realized/unrealized) included in earnings		-			-
Included in other comprehensive income		(764	)		(764	)
Principal payments on securities		-			-
Accretion of securities, net		-			-
Transfers out of Level 3		-			-
Ending balance, June 30, 2012	$	9,636		$	9,636

During the years ended June 30, 2012 and 2011, there were no gains or losses included in earnings attributable to the change in unrealized gains or losses relating to recurring Level 3 assets still held at June 30, 2012 or 2011.

There were no liabilities measured at fair value on a recurring basis at June 30, 2012 and 2011.

Assets Measured at Fair Value on a Non-Recurring Basis

Under certain circumstances the Company makes adjustments to fair value for assets not measured at fair value on an ongoing basis. The following table presents the assets carried on the consolidated balance sheet by caption and by level in the fair value hierarchy at June 30, 2012 and 2011, for which a nonrecurring fair value adjustment has been recorded:

	Fair Value Measurements at Reporting Date Using:
			Quoted Prices in			Significant			Significant			Total Losses
			Active Markets for			Other Observable			Unobservable			for the
			Identical Assets		Inputs			Inputs			Year Ended
	Total		Level 1			Level 2			Level 3			June 30, 2012
	(In thousands)
June 30, 2012
Other real estate owned	$	247	$	-		$	-		$	247		$	56
	Fair Value Measurements at Reporting Date Using:
			Quoted Prices in			Significant			Significant			Total Losses
			Active Markets for			Other Observable			Unobservable			for the
			Identical Assets			Inputs			Inputs			Year Ended
	Total		Level 1			Level 2			Level 3			June 30, 2011
	(In thousands)
June 30, 2011
Impaired loans	$	6,575	$	-		$	-		$	6,575		$	-
Other real estate owned		1,074		-			343			731			95
Totals	$	7,649	$	-		$	343		$	7,306		$	95

The amount of loans represents the carrying value of impaired loans net of related write-downs and valuation allowances for which adjustments are based on the estimated fair value of the underlying collateral. The other real estate owned amount represents the carrying value for which adjustments are also based on the estimated fair value of the property.

Fair value estimates are made at a specific point in time, based on relevant market information and information about the financial instrument. These estimates do not reflect any premium or discount that could result from offering for sale at one time the Company’s entire holdings of a particular financial instrument. Because a market may not readily exist for a significant portion of the Company’s financial instruments, fair value estimates are based on judgments regarding future expected loss experience, current economic conditions, risk characteristics of various financial instruments, and other factors. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimates.

There were no liabilities measured at fair value on a non-recurring basis at June 30, 2012 and 2011.

The estimated fair values and carrying values of the Company’s financial instruments, all of which are held or issued for purposes other than trading, are as follows as of June 30:

	2012
	Carrying Amount		Level 1		Level 2		Level 3		Fair Value
	(In thousands)
Financial assets:
Cash and cash equivalents	$	11,413	$	11,413		-		-	$	11,413
Available-for-sale securities		47,213		-		47,213		-		47,213
Held-to-maturity securities		105,195			108,336		-		108,336
Federal Home Loan Bank Stock		7,536		-		-		7,536		7,536
Loans held-for-sale		776		-		-		794		782
Loans, net		248,572		-		-		255,075		255,074
Accrued interest receivable		1,158		-		-		1,158		1,158
Financial liabilities:
Deposits		342,338		-		-		344,675		344,675
Mortgagors’ escrow accounts		2,034		-		-		2,034		2,034
Federal Home Loan Bank advances		53,500		-		55,340		-		55,340
Securities sold under agreements to repurchase		3,653		-		3,653		-		3,653

	2011
	Carrying Amount		Fair Value
	(In thousands)
Financial assets:
Cash and cash equivalents	$	8,273	$	8,273
Available-for-sale securities		58,009		58,009
Held-to-maturity securities		114,741		115,962
Federal Home Loan Bank Stock		8,056		8,056
Loans held-for-sale		1,567		1,583
Loans, net		253,225		257,835
Accrued interest receivable		1,528		1,528
Financial liabilities:
Deposits		333,773		331,132
Mortgagors’ escrow accounts		1,766		1,766
Federal Home Loan Bank advances		83,500		87,339
Securities sold under agreements to repurchase		4,244		4,244

The carrying amounts of financial instruments shown in the above table are included in the consolidated balance sheets under the indicated captions. Accounting policies related to financial instruments are described in Note 2.