Note 3 - Investment Securities

6 Months Ended

Dec. 31, 2018

Notes to Financial Statements

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

3.

Investment Securities

The following presents a summary of the amortized cost, gross unrealized holding gains and losses, and fair value of investment securities.

	December 31, 2018
	Amortized		Gross Unrealized		Gross Unrealized			Fair
	Cost		Gains		Losses			Value
	(Dollars in thousands)
U.S. Government agency securities	$	57,056	$	79	$	(110	)	$	57,025
Agency mortgage-backed securities		21,853		-		(746	)		21,107
Equity investments measured at net asset value		6,947		-		(236	)		6,711
Total investment securities	$	85,856	$	79	$	(1,092	)	$	84,843

	June 30, 2018
	Amortized		Gross Unrealized		Gross Unrealized			Fair
	Cost		Gains		Losses			Value
	(Dollars in thousands)
U.S. Government agency securities	$	57,129	$	-	$	(242	)	$	56,887
Agency mortgage-backed securities		25,276		-		(1,095	)		24,181
Equity investments measured at net asset value		6,866		-		(247	)		6,619
Total investment securities	$	89,271	$	-	$	(1,584	)	$	87,687

At

December 31, 2018

and

June 30, 2018,

the Company held

no

securities of any single issuer (excluding the U. S. Government and government agencies) with a book value that exceeded

10%

of shareholders’ equity.

When securities are sold, the adjusted cost of the specific security sold is used to compute the gain or loss on sale. There were

no

securities sold during the

three

and

six

months ended

December 31, 2018

or

2017.

At

December 31, 2018,

no

investment securities were pledged as collateral to secure outstanding borrowings.

The following summarizes the Company’s gross unrealized losses and fair values aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position.

	December 31, 2018
	Less than 12 Months					More than 12 Months					Total
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
	Value		Losses			Value		Losses			Value		Losses
	(Dollars in thousands)
U.S. Government agency securities	$	10,914	$	(20	)	$	18,009	$	(90	)	$	28,923	$	(110	)
Agency mortgage-backed securities		-		-			21,107		(746	)		21,107		(746	)
Equity investments measured at net asset value		-		-			5,147		(236	)		5,147		(236	)
Total investment securities	$	10,914	$	(20	)	$	44,263	$	(1,072	)	$	55,177	$	(1,092	)

	June 30, 2018
	Less than 12 Months					More than 12 Months					Total
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
	Value		Losses			Value		Losses			Value		Losses
	(Dollars in thousands)
U.S. Government agency securities	$	25,988	$	(126	)	$	30,899	$	(116	)	$	56,887	$	(242	)
Agency mortgage-backed securities		1,265		(27	)		22,916		(1,068	)		24,181		(1,095	)
Equity investments measured at net asset value		-		-			5,076		(247	)		5,076		(247	)
Total investment securities	$	27,253	$	(153	)	$	58,891	$	(1,431	)	$	86,144	$	(1,584	)

There were

no

other-than-temporary impairment losses on securities during the

three

and

six

months ended

December 31, 2018

or

2017.

At

December 31, 2018,

the Company had

33

securities in an unrealized loss position. At

December 31, 2018,

all of the Company’s available-for-sale securities were issued or guaranteed by either government agencies or government-sponsored enterprises. The decline in fair value of the Company’s investment securities at

December 31, 2018

is attributable to changes in interest rates.

In addition to considering current trends and economic conditions that

may

affect the quality of individual securities within the Company’s investment portfolio, management of the Company also considers the Company’s ability and intent to hold such securities to maturity or recovery of cost. At

December 31, 2018,

the Company does

not

intend to sell and it is

not

more likely than

not

that the Company will be required to sell the investment securities before recovery of its amortized cost. As such, management does

not

believe any of the Company’s investment securities are other-than-temporarily impaired at

December 31, 2018.

The investments measured at net asset value include a fund that seeks to invest in securities either issued or guaranteed by the U.S. government or its agencies, as well as a fund that primarily invests in the federally guaranteed portion of SBA

7

(a) loans that adjust quarterly or monthly and are indexed to the Prime Rate. The underlying composition of these funds is primarily government agencies, other investment-grade investments, or the guaranteed portion of SBA

7

(a) loans, as applicable. As of

December 31, 2018,

the effective duration of the fund that seeks to invest in securities either issued or guaranteed by the U.S. government or its agencies is

4.66

years.

ASU

2016

-

01,

Recognition and Measurements of Financial Assets and Financial Liabilities

, was adopted on

July 1, 2018,

and a cumulative effect adjustment of

$180

thousand was recorded to reclassify the amount of accumulated unrealized losses, net, related to equity securities from accumulated other comprehensive loss to retained earnings. For the

three

and

six

months ended

December 31, 2018,

there were

$50

thousand and

$10

thousand of increases in net unrealized gains on equity securities recognized in the consolidated statements of income, respectively.

The amortized cost and fair values of available-for-sale debt securities by contractual maturity are shown below as of

December 31, 2018.

Actual maturities

may

differ from contractual maturities because borrowers

may

have the right to prepay obligations with or without prepayment penalties.

	Amortized Cost		Fair Value
	(Dollars in thousands)
Due within one year	$	20,094	$	20,003
Due after one year through five years		36,962		37,022
Due after five years through ten years		-		-
Due after ten years		-		-
Total U.S. Government agency securities		57,056		57,025
Agency mortgage-backed securities		21,853		21,107
Total available-for-sale debt securities	$	78,909	$	78,132