Securities

9 Months Ended

Jun. 30, 2020

SECURITIES

The following tables reflect the amortized cost, estimated fair value, and gross unrealized gains and losses of AFS securities at the dates presented. The majority of the MBS and investment securities portfolios are composed of securities issued by United States government-sponsored enterprises ("GSEs").


	June 30, 2020
			Gross		Gross		Estimated
	Amortized		Unrealized		Unrealized		Fair
	Cost		Gains		Losses		Value
	(Dollars in thousands)

MBS	$	949,348	$	33,304	$	65	$	982,587
GSE debentures	225,020		480		—		225,500

Municipal bonds	11,857		110		—		11,967
	$	1,186,225	$	33,894	$	65	$	1,220,054


	September 30, 2019
			Gross		Gross		Estimated
	Amortized		Unrealized		Unrealized		Fair
	Cost		Gains		Losses		Value
	(Dollars in thousands)

MBS	$	923,256	$	15,571	$	2,340	$	936,487
GSE debentures	249,828		304		178		249,954

Municipal bonds	18,371		52		1		18,422
	$	1,191,455	$	15,927	$	2,519	$	1,204,863

The following tables summarize the estimated fair value and gross unrealized losses of those AFS securities on which an unrealized loss at the dates presented was reported and the continuous unrealized loss position for less than 12 months and equal to or greater than 12 months as of the dates presented.


	June 30, 2020
	Less Than 12 Months						Equal to or Greater Than 12 Months
	Estimated		Unrealized		Estimated		Unrealized
	Fair Value		Losses		Fair Value		Losses


MBS	$	37,115	$	64	$	147	$	1
GSE debentures	—		—		—		—

Municipal bonds	—		—		—		—
	$	37,115	$	64	$	147	$	1


	September 30, 2019
	Less Than 12 Months						Equal to or Greater Than 12 Months
	Estimated		Unrealized		Estimated		Unrealized
	Fair Value		Losses		Fair Value		Losses


MBS	$	111,368	$	126	$	199,442	$	2,214
GSE debentures	—		—		74,812		178

Municipal bonds	1,755		1		—		—
	$	113,123	$	127	$	274,254	$	2,392

The unrealized losses at June 30, 2020 and September 30, 2019 were a result of an increase in market yields from the time the securities were purchased. In general, as market yields rise, the fair value of securities will decrease; as market yields fall, the fair value of securities will increase. Management generally views changes in fair value caused by changes in market yields as temporary. Therefore, these securities have not been classified as other-than-temporarily impaired. The impairment is also considered temporary because scheduled coupon payments have been made, it is anticipated that the entire principal balance will be collected as scheduled, and management neither intends to sell the securities, nor is it more likely than not that the Company will be required to sell the securities, before the recovery of the remaining amortized cost amount, which could be at maturity. As a result of the analysis, management has concluded that no other-than-temporary impairments existed at June 30, 2020 or September 30, 2019.

The amortized cost and estimated fair value of AFS debt securities as of June 30, 2020, by contractual maturity, are shown below. Actual principal repayments may differ from contractual maturities due to prepayment or early call privileges by the issuer. In the case of MBS, borrowers on the underlying loans generally have the right to prepay their loans without prepayment penalty. For this reason, MBS are not included in the maturity categories.



	Amortized		Estimated
	Cost		Fair Value
	(Dollars in thousands)
One year or less	$	5,467	$	5,497
One year through five years	231,410		231,970


	236,877		237,467
MBS	949,348		982,587
	$	1,186,225	$	1,220,054

The following table presents the taxable and non-taxable components of interest income on investment securities for the periods presented.



	For the Three Months Ended						For the Nine Months Ended
	June 30,						June 30,
	2020		2019		2020		2019
	(Dollars in thousands)
Taxable	$	797	$	1,749	$	3,556	$	4,516
Non-taxable	50		86		180		265
	$	847	$	1,835	$	3,736	$	4,781

The following table summarizes the carrying value of securities pledged as collateral for the obligations indicated below as of the dates presented.



	June 30, 2020		September 30, 2019
	(Dollars in thousands)
Public unit deposits	$	340,751	$	381,143
Federal Reserve Bank of Kansas City ("FRB of Kansas City")	315,149		6,636
Repurchase agreements	106,625		108,271

	$	762,525	$	496,050