Mortgage Servicing

9 Months Ended

Dec. 31, 2023

Transfers and Servicing [Abstract]

Mortgage Servicing

Note 8 - MORTGAGE SERVICING

Activity for mortgage servicing rights ("MSRs") measured using the amortized cost method was as follows:

(dollars in thousands)	As of December 31, 2023			As of March 31, 2023
Mortgage servicing rights
Balance at beginning of year	$	434		$	563
Additions		103			33
Repayments and amortization		(113	)		(162	)
Balance at end of period	$	424		$	434

At December 31, 2023, no allowance for impairment on the Association’s MSRs was established.

At December 31, 2023 and March 31, 2023, the Association was servicing loans for others amounting to $152,759 and $149,521, respectively. These loans are not reflected in the Association’s financial statements. Servicing loans for others generally consists of collecting mortgage payments, maintaining escrow accounts, disbursing payments to investors, and foreclosure processing. Loan servicing income is recorded on the accrual basis and includes servicing fees from investors and certain charges collected from borrowers, such as late payment fees. In connection with these loans serviced for others, the Association held borrowers’ escrow balances of $2,570 and $3,211 at December 31, 2023 and March 31, 2023, respectively, which are included in interest bearing deposits.

Derivative instruments include interest rate locks on commitments to originate loans for the held for sale portfolio and forward commitments on contracts to deliver mortgage-backed securities. The Association has entered into forward commitments for the sale of mortgage loans principally to protect against the risk of adverse interest rate movements on net income. These derivatives are not designated in a hedging relationship. In addition, the Association has entered into commitments to originate loans, which when funded, are classified as held for sale. Such commitments meet the definition of a derivative and are not designated in a hedging relationship. The notional amount and estimated fair value of all such derivative instruments are immaterial.