IMPAIRMENT OF INVESTMENT SECURITIES

9 Months Ended

Jun. 30, 2023

Impairment of Investment Securities [Abstract]

IMPAIRMENT OF INVESTMENT SECURITIES

NOTE I – IMPAIRMENT OF INVESTMENT SECURITIES

The Company recognizes credit-related other-than-temporary impairment on debt securities in earnings while noncredit-related other-than-temporary impairment on debt securities not expected to be sold are recognized in other comprehensive income.

The Company reviews its investment portfolio on a quarterly basis for indications of impairment. This review includes analyzing the length of time and the extent to which the fair value has been lower than the cost, the financial condition and near-term prospects of the issuer, including any specific events which may influence the operations of the issuer and the intent and ability to hold the investment for a period of time sufficient to allow for any anticipated recovery in the market. The Company evaluates its intent and ability to hold debt securities based upon its investment strategy for the particular type of security and its cash flow needs, liquidity position, capital adequacy and interest rate risk position. In addition, the risk of future other-than-temporary impairment may be influenced by prolonged recession in the U.S. economy, changes in real estate values and interest deferrals.

Investment securities with fair values greater than their amortized cost contain unrealized gains. Investment securities with fair values less than their amortized cost contain unrealized losses. Details of securities with unrealized losses at June 30, 2023 and September 30, 2022 are as follows:

			Less Than 12 Months					12 Months Or Greater					Total
	Number of		Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
	Securities		Value		Losses			Value		Losses			Value		Losses
June 30, 2023			(Dollars in thousands)
Obligations of U.S. government agencies:
Mortgage-backed securities - residential		6	$	—	$	—		$	4,567	$	(740	)	$	4,567	$	(740	)
Mortgage-backed securities - commercial		1		—		—			582		(2	)		582		(2	)
Obligations of U.S. government-sponsored enterprises
Mortgage-backed securities - residential		50		442		(18	)		47,521		(8,737	)		47,963		(8,755	)
Debt securities		14		—		—			22,881		(1,954	)		22,881		(1,954	)
Private label mortgage-backed securities residential		1		—		—			200		(11	)		200		(11	)
Obligations of state and political subdivisions		6		522		(6	)		2,245		(392	)		2,767		(398	)
Corporate securities		1		—		—			2,804		(197	)		2,804		(197	)
Total		79	$	964	$	(24	)	$	80,800	$	(12,033	)	$	81,764	$	(12,057	)
September 30, 2022
Obligations of U.S. government agencies:
Mortgage-backed securities - residential		6	$	2,364	$	(140	)	$	2,551	$	(588	)	$	4,915	$	(728	)
Mortgage-backed securities - commercial		1		631		—			—		—			631		—
Obligations of U.S. government-sponsored enterprises
Mortgage-backed securities - residential		49		21,180		(2,795	)		29,088		(6,660	)		50,268		(9,455	)
Debt securities		14		11,664		(660	)		10,763		(1,735	)		22,427		(2,395	)
Private label mortgage-backed securities residential		1		215		(10	)		—		—			215		(10	)
Obligations of state and political subdivisions		7		1,268		(181	)		1,577		(457	)		2,845		(638	)
Corporate securities		2		2,646		(353	)		4,917		(83	)		7,563		(436	)
Total		80	$	39,968	$	(4,139	)	$	48,896	$	(9,523	)	$	88,864	$	(13,662	)

The investment securities listed above currently have fair values less than amortized cost and therefore contain unrealized losses. The Company evaluated these securities and determined that the decline in value was primarily related to fluctuations in the interest rate environment and were not related to any company or industry specific event.

The Company anticipates full recovery of amortized costs with respect to these securities. The Company does not intend to sell these securities and has determined that it is not more likely than not that the Company would be required to sell these securities prior to maturity or market price recovery. Management has considered factors regarding other than temporarily impaired securities and determined that there are no securities with impairment that is other than temporary as of June 30, 2023 and September 30, 2022.