INCOME TAXES (Tables)

12 Months Ended

Sep. 30, 2024

Income Tax Disclosure [Abstract]

Provision for Income Taxes

The Company and its subsidiaries file a consolidated federal income tax return on a fiscal year basis. The provision for income taxes were as follows:

	Fiscal Year Ended September 30,
(Dollars in thousands)	2024		2023		2022
Federal:
Current	$	9,815	$	8,682	$	5,657
Deferred	9,281		(1,168)		12,900
	19,096		7,514		18,557
State:
Current	8,211		7,817		4,720
Deferred	1,834		993		4,687
	10,045		8,810		9,407
Income tax expense	$	29,141	$	16,324	$	27,964

Components of Net Deferred Tax Asset (Liability)

The tax effects of the Company's temporary differences that give rise to significant portions of its deferred tax assets and liabilities were:

	At September 30,
(Dollars in thousands)	2024		2023
Deferred tax assets:
Allowance for credit losses	$	11,042	$	11,606
Deferred compensation	4,351		3,739
Stock based compensation	2,402		3,916
Valuation adjustments	175		393
General business credits(1)	55,706		59,783
Accrued expenses	2,763		2,558
Lease liability	6,503		7,210
Net unrealized loss on securities available for sale	50,819		84,908
Premises and equipment	3,939		—
Other assets	3,940		4,193
	141,640		178,306
Deferred tax liabilities:
Premises and equipment	—		(2,016)
Intangibles	(7,859)		(5,862)
Leased assets	(76,016)		(66,877)
Right-of-use assets	(6,218)		(6,877)
Other liabilities	(1,346)		(1,349)
	(91,439)		(82,981)
Net deferred tax assets	$	50,201	$	95,325

(1) The general business credits are investment tax credits generated from qualified solar energy property placed in service during the fiscal years ended September 30, 2024 and 2023. These credits will begin to expire on September 30, 2042.

Reconciliation of Total Income Tax Expense

The Company's effective tax rate is calculated by dividing income tax expense by income before income tax expense.

	Fiscal Year Ended September 30,
	2024				2023				2022
(Dollars in thousands)	Amount		Rate		Amount		Rate		Amount		Rate
Statutory federal income tax expense and rate	$	41,746	21.0	%	$	38,248	21.0	%	$	38,714	21.0	%
Change in tax rate resulting from:
State income taxes net of federal benefits	7,875		4.0	%	7,047		3.9	%	7,413		4.0	%
162(m) disallowance	1,874		0.9	%	919		0.5	%	1,125		0.4	%
Tax exempt income	(690)		(0.3)	%	(783)		(0.4)	%	(743)		(0.4)	%
General business credits	(21,132)		(10.6)	%	(28,633)		(15.7)	%	(17,589)		(9.5)	%
Other, net	(532)		(0.3)	%	(474)		(0.3)	%	(956)		(0.3)	%
Income tax expense	$	29,141	14.7	%	$	16,324	9.0	%	$	27,964	15.2	%

Reconciliation of Liabilities Associated with Unrecognized Tax Benefits

A reconciliation of the beginning and ending balances for liabilities associated with unrecognized tax benefits follows:

	At September 30,
(Dollars in thousands)	2024		2023
Balance at beginning of fiscal year	$	521	$	645
Additions (reductions) for tax positions related to prior years	56		(124)
Balance at end of fiscal year	$	577	$	521