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Investment Securities
 9 Months Ended
Mar. 31, 2020
Investments Debt And Equity Securities [Abstract]  
Investment Securities

Note 3. Investment Securities

The amortized cost, gross unrealized/unrecognized gains and losses and fair value of available for sale and held to maturity debt securities at March 31, 2020 and June 30, 2019 were as follows:

 

 

 

March 31, 2020

 

 

 

Amortized

 

 

Gross Unrealized/Unrecognized

 

 

Fair

 

 

 

Cost

 

 

Gains

 

 

Losses

 

 

Value

 

 

 

 

 

 

 

(in thousands)

 

 

 

 

 

Available for sale:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Government and agency obligations

 

$

19,006

 

 

$

83

 

 

$

-

 

 

$

19,089

 

Corporate and other debt securities

 

 

5,044

 

 

 

71

 

 

 

(89

)

 

 

5,026

 

Mortgage-backed securities – residential

 

 

21,819

 

 

 

149

 

 

 

(91

)

 

 

21,877

 

Total available for sale

 

$

45,869

 

 

$

303

 

 

$

(180

)

 

$

45,992

 

Held to maturity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Government and agency obligations

 

$

33,002

 

 

$

500

 

 

$

-

 

 

$

33,502

 

Corporate and other debt securities

 

 

46,107

 

 

 

90

 

 

 

(2,762

)

 

 

43,435

 

Mortgage-backed securities – residential

 

 

116,666

 

 

 

3,839

 

 

 

(2

)

 

 

120,503

 

Mortgage-backed securities – collateralized mortgage obligations

 

 

47,581

 

 

 

1,589

 

 

 

-

 

 

 

49,170

 

Mortgage-backed securities – commercial

 

 

20,270

 

 

 

826

 

 

 

(2

)

 

 

21,094

 

Total held to maturity

 

$

263,626

 

 

$

6,844

 

 

$

(2,766

)

 

$

267,704

 

 

 

 

June 30, 2019

 

 

 

Amortized

 

 

Gross Unrealized/Unrecognized

 

 

Fair

 

 

 

Cost

 

 

Gains

 

 

Losses

 

 

Value

 

 

 

 

 

 

 

(in thousands)

 

 

 

 

 

Available for sale:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Government and agency obligations

 

$

37,027

 

 

$

5

 

 

$

(121

)

 

$

36,911

 

Corporate and other debt securities

 

 

8,349

 

 

 

20

 

 

 

(9

)

 

 

8,360

 

Mortgage-backed securities – residential

 

 

27,115

 

 

 

23

 

 

 

(181

)

 

 

26,957

 

Total available for sale

 

$

72,491

 

 

$

48

 

 

$

(311

)

 

$

72,228

 

Held to maturity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Government and agency obligations

 

$

96,545

 

 

$

192

 

 

$

(246

)

 

$

96,491

 

Corporate and other debt securities

 

 

34,033

 

 

 

133

 

 

 

(413

)

 

 

33,753

 

Mortgage-backed securities – residential

 

 

133,602

 

 

 

818

 

 

 

(372

)

 

 

134,048

 

Mortgage-backed securities – collateralized mortgage obligations

 

 

52,940

 

 

 

311

 

 

 

(147

)

 

 

53,104

 

Mortgage-backed securities – commercial

 

 

28,425

 

 

 

451

 

 

 

(29

)

 

 

28,847

 

Total held to maturity

 

$

345,545

 

 

$

1,905

 

 

$

(1,207

)

 

$

346,243

 

 

During the three and nine months ended March 31, 2020, the Company sold $4.7 million of securities which resulted in $38,000 of realized gains, which included the disposal of $426,000 of securities classified as held to maturity, resulting in $17,000 of gross realized gains. These held to maturity securities were comprised of seasoned mortgage-backed securities where the Company collected a substantial portion (at least 85%) of the principal outstanding at acquisition due to prepayments or scheduled payments payable in equal installments, comparing both principal and interest over terms. During the nine months ended March 31, 2019, the Company sold $2.1 million of securities resulting in $55,000 of realized gains.

The following table presents the fair value and carrying amount of debt securities at March 31, 2019, by contractual maturity. Expected maturities may differ from contractual maturities if borrowers have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date, primarily mortgage-backed securities, are shown separately.

 

 

 

Held to maturity

 

 

Available for sale

 

 

 

Carrying

 

 

Fair

 

 

Amortized

 

 

Fair

 

 

 

Amount

 

 

Value

 

 

Cost

 

 

Value

 

1 year or less

 

$

22,000

 

 

$

22,088

 

 

$

18,007

 

 

$

18,076

 

1 to 5 years

 

 

19,002

 

 

 

18,963

 

 

 

6,043

 

 

 

6,039

 

5 to 10 years

 

 

34,125

 

 

 

31,814

 

 

 

-

 

 

 

-

 

Mortgage-backed securities and other

 

 

188,499

 

 

 

194,839

 

 

 

21,819

 

 

 

21,877

 

Total

 

$

263,626

 

 

$

267,704

 

 

$

45,869

 

 

$

45,992

 

 

Securities pledged had carrying amounts of $185.0 million and $166.4 million at March 31, 2020 and June 30, 2019, respectively, and were pledged principally to secure FHLB advances and public deposits.

The following table provides information regarding investment securities with unrealized/unrecognized losses, aggregated by investment category and length of time that individual securities had been in a continuous unrealized loss position at March 31, 2020 and June 30, 2019:

 

 

 

March 31, 2020

 

 

 

Less than 12 months

 

 

12 months or greater

 

 

Total

 

 

 

 

 

 

Unrealized/

 

 

 

 

 

Unrealized/

 

 

 

 

 

Unrealized/

 

 

 

Fair

 

 

Unrecognized

 

 

Fair

 

 

Unrecognized

 

 

Fair

 

 

Unrecognized

 

 

 

Value

 

 

Loss

 

 

Value

 

 

Loss

 

 

Value

 

 

Loss

 

 

 

(in thousands)

 

Available for sale:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate and other debt securities

 

$

1,911

 

 

$

(89

)

 

$

-

 

 

$

-

 

 

$

1,911

 

 

$

(89

)

Mortgage-backed securities – residential

 

 

6,412

 

 

 

(40

)

 

 

2,368

 

 

 

(51

)

 

 

8,780

 

 

 

(91

)

Total available for sale

 

$

8,323

 

 

$

(129

)

 

$

2,368

 

 

$

(51

)

 

$

10,691

 

 

$

(180

)

Held to maturity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate and other debt securities

 

$

30,291

 

 

$

(2,334

)

 

$

2,071

 

 

$

(428

)

 

$

32,362

 

 

$

(2,762

)

Mortgage-backed securities – residential

 

 

914

 

 

 

(2

)

 

 

-

 

 

 

-

 

 

 

914

 

 

 

(2

)

Mortgage-backed securities – commercial

 

 

-

 

 

 

-

 

 

 

1,438

 

 

 

(2

)

 

 

1,438

 

 

 

(2

)

Total held to maturity

 

$

31,205

 

 

$

(2,336

)

 

$

3,509

 

 

$

(430

)

 

$

34,714

 

 

$

(2,766

)

 

 

 

 

June 30, 2019

 

 

 

Less than 12 months

 

 

12 months or greater

 

 

Total

 

 

 

 

 

 

Unrealized/

 

 

 

 

 

Unrealized/

 

 

 

 

 

Unrealized/

 

 

 

Fair

 

 

Unrecognized

 

 

Fair

 

 

Unrecognized

 

 

Fair

 

 

Unrecognized

 

 

 

Value

 

 

Loss

 

 

Value

 

 

Loss

 

 

Value

 

 

Loss

 

 

 

(in thousands)

 

Available for sale

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Government and agency obligations

 

$

-

 

 

$

-

 

 

$

32,919

 

 

$

(121

)

 

$

32,919

 

 

$

(121

)

Corporate and other debt securities

 

 

-

 

 

 

-

 

 

 

3,269

 

 

 

(9

)

 

 

3,269

 

 

 

(9

)

Mortgage-backed securities – residential

 

 

-

 

 

 

-

 

 

 

24,000

 

 

 

(181

)

 

 

24,000

 

 

 

(181

)

Total available for sale

 

$

-

 

 

$

-

 

 

$

60,188

 

 

$

(311

)

 

$

60,188

 

 

$

(311

)

Held to maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Government and agency obligations

 

$

-

 

 

$

-

 

 

$

59,306

 

 

$

(246

)

 

$

59,306

 

 

$

(246

)

Corporate and other debt securities

 

 

17,087

 

 

 

(413

)

 

 

-

 

 

 

-

 

 

 

17,087

 

 

 

(413

)

Mortgage-backed securities – residential

 

 

1,666

 

 

 

(26

)

 

 

54,648

 

 

 

(346

)

 

 

56,314

 

 

 

(372

)

Mortgage-backed securities – collateralized

   mortgage obligations

 

 

-

 

 

 

-

 

 

 

29,372

 

 

 

(147

)

 

 

29,372

 

 

 

(147

)

Mortgage-backed securities – commercial

 

 

-

 

 

 

-

 

 

 

6,972

 

 

 

(29

)

 

 

6,972

 

 

 

(29

)

Total held to maturity

 

$

18,753

 

 

$

(439

)

 

$

150,298

 

 

$

(768

)

 

$

169,051

 

 

$

(1,207

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of March 31, 2020, the Company’s securities portfolio consisted of $309.6 million in securities, of which 23 securities with a fair value of $45.4 million were in an unrealized loss position. The majority of unrealized losses are related to the Company’s U.S. Government and agency obligations and mortgage-backed securities.

There were no securities as of March 31, 2020 or June 30, 2019 for which the Company believes it is not probable that it will collect all amounts due according to the contractual terms of the security. Management believes the unrealized losses are primarily a result of changes in interest rates and credit spreads. The Company has determined that it does not intend to sell, or it is not more likely than not that it will be required to sell, its securities that are in an unrealized loss position prior to the recovery of its amortized cost basis. Therefore, the Company did not consider any securities to be other-than-temporarily impaired as of March 31, 2020 or June 30, 2019.