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LOANS
 12 Months Ended
Jun. 30, 2023
Receivables [Abstract]  
LOANS

4. Loans

A summary of the balances of loans follows:

 

(In thousands)

 

June 30, 2023

 

 

June 30, 2022

 

Mortgage loans on real estate:

 

 

 

 

 

 

Residential:

 

 

 

 

 

 

1-4 family

 

$

140,109

 

 

$

141,073

 

Multifamily

 

 

12,638

 

 

 

14,310

 

Second mortgages and home equity lines of credit

 

 

2,699

 

 

 

1,970

 

Construction

 

 

-

 

 

 

375

 

Commercial

 

 

20,323

 

 

 

14,761

 

Total mortgage loans on real estate

 

 

175,769

 

 

 

172,489

 

Consumer loans:

 

 

 

 

 

 

Consumer

 

 

49

 

 

 

84

 

Home improvement

 

 

2,191

 

 

 

2,116

 

Total other loans

 

 

2,240

 

 

 

2,200

 

Total loans

 

 

178,009

 

 

 

174,689

 

Allowance for loan losses

 

 

(1,747

)

 

 

(1,747

)

Net deferred loan fees

 

 

(351

)

 

 

(349

)

Loans, net

 

$

175,911

 

 

$

172,593

 

There were no loans serviced for others at June 30, 2023 and 2022.

Residential loans are subject to a blanket lien securing FHLB advances. See Note 7 of these consolidated financial statements.

Included in total loans are loans due from directors and other related parties of $2.1 million and $3.0 million at June 30, 2023 and 2022, respectively. All loans made to directors have substantially the same terms and interest rates as other bank borrowers at their origination date. The Board of Directors confirms that collateral requirements, terms and rates are comparable to other borrowers and are in compliance with underwriting policies prior to approving loans to individual directors. The following presents the activity in amount due from directors and other related parties for the years ended June 30, 2023 and 2022:

 

(In thousands)

 

June 30, 2023

 

 

June 30, 2022

 

Outstanding related party loans at July 1,

 

$

3,047

 

 

$

2,544

 

New loans

 

 

-

 

 

 

1,211

 

Draws

 

 

3

 

 

 

-

 

Transfers

 

 

(482

)

 

 

-

 

Repayments

 

 

(490

)

 

 

(708

)

Outstanding related party loans at June 30,

 

$

2,078

 

 

$

3,047

 

 

Activity in the allowance for loan losses and allocation of the allowance to loan segments follows:

(In thousands)

 

Residential 1-4 Family

 

 

Multifamily

 

 

Second Mortgages and Home Equity Lines of Credit

 

 

Construction

 

 

Commercial Real Estate

 

 

Consumer

 

 

Home Improvement

 

 

Unallocated

 

 

Total

 

Balance at June 30, 2022

 

$

986

 

 

$

215

 

 

$

22

 

 

$

4

 

 

$

252

 

 

$

-

 

 

$

61

 

 

$

207

 

 

$

1,747

 

Provision (credit) for loan losses

 

 

(12

)

 

 

(25

)

 

 

7

 

 

 

(4

)

 

 

94

 

 

 

-

 

 

 

3

 

 

 

(63

)

 

 

-

 

Loans charged-off

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Recoveries

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Balance at June 30, 2023

 

$

974

 

 

$

190

 

 

$

29

 

 

$

-

 

 

$

346

 

 

$

-

 

 

$

64

 

 

$

144

 

 

$

1,747

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at June 30, 2021

 

$

967

 

 

$

272

 

 

$

23

 

 

$

-

 

 

$

279

 

 

$

-

 

 

$

58

 

 

$

123

 

 

$

1,722

 

Provision (credit) for loan losses

 

 

19

 

 

 

(57

)

 

 

(1

)

 

 

4

 

 

 

(27

)

 

 

-

 

 

 

4

 

 

 

84

 

 

 

26

 

Loans charged-off

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(1

)

 

 

-

 

 

 

(1

)

Recoveries

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Balance at June 30, 2022

 

$

986

 

 

$

215

 

 

$

22

 

 

$

4

 

 

$

252

 

 

$

-

 

 

$

61

 

 

$

207

 

 

$

1,747

 

 

The allocation of the allowance for loan losses to each category is presented as of June 30, 2023 and 2022.

(In thousands)

 

Residential 1-4 Family

 

 

Multifamily

 

 

Second Mortgages and Home Equity Lines of Credit

 

 

Construction

 

 

Commercial Real Estate

 

 

Consumer

 

 

Home Improvement

 

 

Unallocated

 

 

Total

 

June 30, 2023

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for impaired loans

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

Allowance for non-impaired loans

 

 

974

 

 

 

190

 

 

 

29

 

 

 

-

 

 

 

346

 

 

 

-

 

 

 

64

 

 

 

144

 

 

 

1,747

 

Total allowance for loan losses

 

$

974

 

 

$

190

 

 

$

29

 

 

$

-

 

 

$

346

 

 

$

-

 

 

$

64

 

 

$

144

 

 

$

1,747

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Impaired loans

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

Non-impaired loans

 

 

140,109

 

 

 

12,638

 

 

 

2,699

 

 

 

-

 

 

 

20,323

 

 

 

49

 

 

 

2,191

 

 

 

-

 

 

 

178,009

 

Total loans

 

$

140,109

 

 

$

12,638

 

 

$

2,699

 

 

$

-

 

 

$

20,323

 

 

$

49

 

 

$

2,191

 

 

$

-

 

 

$

178,009

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

June 30, 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for impaired loans

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

Allowance for non-impaired loans

 

 

986

 

 

 

215

 

 

 

22

 

 

 

4

 

 

 

252

 

 

 

-

 

 

 

61

 

 

 

207

 

 

 

1,747

 

Total allowance for loan losses

 

$

986

 

 

$

215

 

 

$

22

 

 

$

4

 

 

$

252

 

 

$

-

 

 

$

61

 

 

$

207

 

 

$

1,747

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Impaired loans

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

Non-impaired loans

 

 

141,073

 

 

 

14,310

 

 

 

1,970

 

 

 

375

 

 

 

14,761

 

 

 

84

 

 

 

2,116

 

 

 

-

 

 

 

174,689

 

Total loans

 

$

141,073

 

 

$

14,310

 

 

$

1,970

 

 

$

375

 

 

$

14,761

 

 

$

84

 

 

$

2,116

 

 

$

-

 

 

$

174,689

 

At June 30, 2023 and 2022 there were no past due loans or loans on non-accrual status and there were no loans past due ninety days or more and still accruing.

There were no impaired loans at June 30, 2023 or 2022.

During the years ended June 30, 2023 and 2022, there were no troubled debt restructurings or troubled debt restructurings that defaulted in the first twelve months after restructuring. Management is required to perform a discounted cash flow calculation to determine the amount of impairment reserve required on any troubled debt restructurings. Any reserve would be recorded through the provision for loan losses.

 

Credit Quality Information

The Company utilizes an internal loan rating system for residential real estate, commercial real estate, and construction loans as follows:

Pass: Loans in this category are considered to pose low to average risk. Passed assets are generally protected by the current net worth and paying capacity of the obligor or by the value of collateral pledged.

Special Mention: Loans in this category possess credit deficiencies or potential weaknesses deserving management’s close attention. If uncorrected, such deficiencies or weaknesses may expose the Company to an increased risk of loss.

Substandard: Loans in this category are considered to be inadequately protected by the current net worth and paying capacity of the obligors and/or the collateral pledged. These assets have a well-defined weakness and are characterized by the distinct possibility that the Company will sustain some loss if the deficiencies are not corrected.

Doubtful: Loans in this category 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.

Loss: Loans in this category are considered uncollectible and continuance as a bankable asset is not warranted. Loans in this category are generally charged-off.

On an annual basis, or more often if needed, the Company formally reviews the ratings on all commercial real estate and construction loans. On a monthly basis, the Company reviews the residential and other loan portfolios for credit quality primarily through the use of delinquency reports.

The following table presents information on the Company’s loans by risk ratings at June 30, 2023 and 2022:

(In thousands)

 

Residential 1-4 Family

 

 

Multifamily

 

 

Second Mortgages and Home Equity Lines of Credit

 

 

Construction

 

 

Commercial Real Estate

 

 

Consumer

 

 

Home Improvement

 

 

Total

 

June 30, 2023

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass

 

$

138,678

 

 

$

12,638

 

 

$

2,699

 

 

$

-

 

 

$

20,323

 

 

$

49

 

 

$

2,191

 

 

$

176,578

 

Special mention

 

 

1,431

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,431

 

Total loans

 

$

140,109

 

 

$

12,638

 

 

$

2,699

 

 

$

-

 

 

$

20,323

 

 

$

49

 

 

$

2,191

 

 

$

178,009

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

June 30, 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass

 

$

141,073

 

 

$

14,310

 

 

$

1,970

 

 

$

375

 

 

$

14,761

 

 

$

84

 

 

$

2,116

 

 

$

174,689

 

Total loans

 

$

141,073

 

 

$

14,310

 

 

$

1,970

 

 

$

375

 

 

$

14,761

 

 

$

84

 

 

$

2,116

 

 

$

174,689

 

At June 30, 2023 and 2022, there were no loans rated substandard, doubtful or loss.