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Fair Value of Financial Instruments (Tables)

6 Months Ended

Dec. 31, 2018

Schedule of Assets Measured At Fair Value on a Recurring Basis

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

	December 31, 2018
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
	(In Thousands)
Assets:
Debt securities available for sale:
U.S. agency securities	$	-	$	3,942	$	-	$	3,942
Obligations of state and political subdivisions		-		26,205		-		26,205
Asset-backed securities		-		180,828		-		180,828
Collateralized loan obligations		-		184,439		-		184,439
Corporate bonds		-		144,692		-		144,692
Trust preferred securities		-		2,726		1,000		3,726
Total debt securities		-		542,832		1,000		543,832

Mortgage-backed securities available for sale:
Collateralized mortgage obligations		-		23,019		-		23,019
Residential pass-through securities		-		91,918		-		91,918
Commercial pass-through securities		-		7,833		-		7,833
Total mortgage-backed securities		-		122,770		-		122,770
Total securities available for sale	$	-	$	665,602	$	1,000	$	666,602
Interest rate swaps		-		22,109		-		22,109

Total assets	$	-	$	687,711	$	1,000	$	688,711

	June 30, 2018
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
	(In Thousands)
Assets:
Debt securities available for sale:
U.S. agency securities	$	-	$	4,411	$	-	$	4,411
Obligations of state and political subdivisions		-		26,088		-		26,088
Asset-backed securities		-		182,620		-		182,620
Collateralized loan obligations		-		226,066		-		226,066
Corporate bonds		-		147,594		-		147,594
Trust preferred securities		-		2,783		1,000		3,783
Total debt securities		-		589,562		1,000		590,562

Mortgage-backed securities available for sale:
Collateralized mortgage obligations		-		24,292		-		24,292
Residential pass-through securities		-		102,359		-		102,359
Commercial pass-through securities		-		7,872		-		7,872
Total mortgage-backed securities		-		134,523		-		134,523
Total securities available for sale		-		724,085		1,000		725,085
Interest rate swaps and caps		-		31,881		-		31,881

Total assets	$	-	$	755,966	$	1,000	$	756,966

Schedule of Assets Measured At Fair Value on a Non-recurring Basis

Those assets measured at fair value on a non-recurring basis are summarized below:

	December 31, 2018
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
	(In Thousands)
Impaired loans:
Residential mortgage	$	-	$	-	$	3,446	$	3,446
Non-residential mortgage		-		-		791		791
Commercial business		-		-		62		62
Total	$	-	$	-	$	4,299	$	4,299

Other real estate owned, net:
Residential mortgage	$	-	$	-	$	288	$	288
Total	$	-	$	-	$	288	$	288

	June 30, 2018
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
	(In Thousands)
Impaired loans:
Residential mortgage	$	-	$	-	$	3,562	$	3,562
Non-residential mortgage		-		-		794		794
Commercial business		-		-		113		113
Total	$	-	$	-	$	4,469	$	4,469

Schedule of Quantitative Information about Level 3 Fair Value Measurements

The following table presents additional quantitative information about assets measured at fair value on a non-recurring basis and for which the Company has utilized adjusted Level 3 inputs to determine fair value:

	December 31, 2018
	Fair Value		Valuation Techniques		Unobservable Input		Range	Weighted Average
	(In Thousands)
Impaired loans:
Residential mortgage	$	3,446	Market valuation of underlying collateral	⁽¹⁾	Adjustments to reflect current conditions/selling costs	⁽²⁾	6% - 21%		9.35	%
Non-residential mortgage		791	Market valuation of underlying collateral	⁽¹⁾	Adjustments to reflect current conditions/selling costs	⁽²⁾	11% - 12%		11.74	%
Commercial business		62	Market valuation of underlying collateral	⁽¹⁾	Adjustments to reflect current conditions/selling costs	⁽²⁾	0% - 10%		6.46	%
Total	$	4,299

Other real estate owned, net:
Residential mortgage	$	288	Market valuation of underlying collateral	⁽³⁾	Adjustments to reflect current conditions/selling costs	⁽²⁾	5.00%		5.00	%
Total	$	288

June 30, 2018

Fair

Value

Valuation

Techniques

Unobservable

Input

Range

Weighted

Average

(In Thousands)

Impaired loans:

Residential mortgage

3,562

Market valuation of

underlying collateral

⁽¹⁾

Adjustments to reflect current

conditions/selling costs

⁽²⁾

6% - 26%

12.34

Non-residential mortgage

794

Market valuation of

underlying collateral

⁽¹⁾

Adjustments to reflect current

conditions/selling costs

⁽²⁾

14% - 15%

14.07

Commercial business

113

Market valuation of

underlying collateral

⁽¹⁾

Adjustments to reflect current

conditions/selling costs

⁽²⁾

10% - 24%

14.54

Total

4,469

(1)	The fair value of impaired loans is generally determined based on an independent appraisal of the fair value of a loan’s underlying collateral.

(2)	The fair value basis of impaired loans and other real estate owned is adjusted to reflect management estimates of selling costs including, but not necessarily limited to, real estate brokerage commissions and title transfer fees.

(3)	The fair value basis of other real estate owned is generally determined based upon the lower of an independent appraisal of the property’s fair value or the applicable listing price or contracted sales price.

Schedule of Carrying Amounts and Fair Values of Financial Instruments

The following presents the carrying amount, fair value, and placement in the fair value hierarchy of the Company’s financial instruments as of December 31, 2018 and June 30, 2018:

	December 31, 2018
	Carrying Amount		Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
	(In Thousands)
Financial assets:
Cash and cash equivalents	$	51,483	$	51,483	$	51,483	$	-	$	-
Investment securities available for sale		666,602		666,602		-		665,602		1,000
Investment securities held to maturity		598,318		592,151		-		592,151		-
Loans held-for-sale		1,001		1,001		-		1,001		-
Net loans receivable		4,719,866		4,588,099		-		-		4,588,099
FHLB Stock		64,514		-		-		-		-
Interest receivable		19,435		19,435		6		5,060		14,369
Interest rate swaps		22,109		22,109		-		22,109		-

Financial liabilities:
Deposits		4,173,434		4,160,515		2,287,548		-		1,872,967
Borrowings		1,310,547		1,314,802		-		-		1,314,802
Interest payable on deposits		1,446		1,446		-		1,446		-
Interest payable on borrowings		3,866		3,866		-		-		3,866

	June 30, 2018
	Carrying Amount		Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
	(In Thousands)
Financial assets:
Cash and cash equivalents	$	128,864	$	128,864	$	128,864	$	-	$	-
Investment securities available for sale		725,085		725,085		-		724,085		1,000
Investment securities held to maturity		589,730		579,499		-		579,499		-
Loans held-for-sale		863		863		-		863		-
Net loans receivable		4,470,483		4,367,150		-		-		4,367,150
FHLB Stock		59,004		-		-		-		-
Interest receivable		18,510		18,510		32		5,252		13,226
Interest rate swaps and caps		31,881		31,881				31,881

Financial liabilities:
Deposits		4,073,604		4,055,543		2,056,966		-		1,998,577
Borrowings		1,198,646		1,199,601		-		-		1,199,601
Interest payable on deposits		675		675		-		675		-
Interest payable on borrowings		2,427		2,427		-		-		2,427