FAIR VALUE MEASUREMENTS

3 Months Ended

Sep. 30, 2011

FAIR VALUE MEASUREMENTS [Abstract]

FAIR VALUE MEASUREMENTS

10. FAIR VALUE MEASUREMENTS

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for an asset or liability in an orderly transaction between market participants at the measurement date. GAAP established a fair value hierarchy that prioritizes the use of inputs used in valuation methodologies into the following three levels:

Level I:	Quoted prices are available in active markets for identical assets or liabilities as of the reported date.
Level II:	Pricing inputs are other than quoted prices in active markets, which are either directly or indirectly observable as of the reported date. The nature of these assets and liabilities include items for which quoted prices are available but traded less frequently, and items that are fair valued using other financial instruments, the parameters of which can be directly observed.
Level III:	Assets and liabilities that have little to no pricing observability as of the reported date. These items do not have two-way markets and are measured using management's best estimate of fair value, where the inputs into the determination of fair value require significant management judgment or estimation.

The following tables present the assets reported on a recurring basis on the consolidated balance sheet at their fair value as of September 30, 2011 and June 30, 2011, by level within the fair value hierarchy. As required by GAAP, financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.

	September 30, 2011
	Level I		Level II		Level III		Total
Assets Measured on a Recurring Basis:
Investment securities - available for sale:
Corporate securities	$	-	$	21,925	$	-	$	21,925
Foreign debt securities (1)		-		594		-		594
	$	-	$	22,519	$	-	$	22,519

⁽¹⁾  U.S. dollar-denominated investment-grade corporate bonds of large foreign issuers

	June 30, 2011
	Level I		Level II		Level III		Total
Assets Measured on a Recurring Basis:
Investment securities - available for sale:
Corporate securities	$	-	$	1,064	$	-	$	1,064

The Company may be required, from time to time, to measure certain financial assets and financial liabilities at fair value on a nonrecurring basis in accordance with U.S. generally accepted accounting principles. These include assets that are measured at the lower of cost or market value that were recognized at fair value below cost at the end of the period.

The following tables present the assets reported on a non-recurring basis on the consolidated balance sheet at their fair value as of September 30, 2011 and June 30, 2011, by level within the fair value hierarchy. As required by GAAP, financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.

	September 30, 2011
	Level I		Level II		Level III		Total
Assets Measured on a Non-recurring Basis:
Impaired loans	$	-	$	-	$	701	$	701
Real estate owned		-		-		417		417
Mortgage-backed securities held to maturity:
Collateralized mortgage obligations - private-label		-		-		800		800
Total	$	-	$	-	$	1,918	$	1,918

	June 30, 2011
	Level I		Level II		Level III		Total
Assets Measured on a Non-recurring Basis:
Impaired loans	$	-	$	-	$	957	$	957
Real estate owned		-		-		235		235
Total	$	-	$	-	$	1,192	$	1,192

Loans for which it is probable that payment of interest and principal will not be made in accordance with the contractual terms of the loan agreement are considered impaired. Once a loan is identified as individually impaired, management measures impairment in accordance with ASC Topic 310. The fair value of impaired loans is estimated using one of several methods, including collateral value, liquidation value and discounted cash flows. Those impaired loans not requiring an allowance represent loans for which the fair value of the expected repayments or collateral exceed the recorded investments in such loans. Collateral values are estimated using Level II inputs based on observable market data or Level III inputs based on customized discounting criteria. For a majority of impaired real estate related loans, the Company obtains a current external appraisal. Other valuation techniques are used as well, including internal valuations, comparable property analysis and contractual sales information.

Real estate acquired through foreclosure or deed in lieu of foreclosure is carried at fair value less estimated costs to sell. Any reduction from the carrying value of the related loan to fair value at the time of acquisition is accounted for as a loan loss. Any subsequent reduction in fair market value is reflected as a valuation allowance through a charge to income. Costs of significant property improvements are capitalized, whereas costs relating to holding and maintaining the property, are charged to expense.

Fair values for securities available for sale are determined by obtaining quoted prices on nationally recognized securities exchanges or matrix pricing, which is a mathematical technique widely used in the industry to value debt securities without relying exclusively on quoted prices for the specific securities, but rather by relying on the securities' relationship to other benchmark quoted securities.

The Company classifies financial instruments in Level III of the fair-value hierarchy when there is reliance on at least one significant unobservable input to the valuation model. In addition to these unobservable inputs, the valuation model for Level III financial instruments typically also rely on a number of inputs that are readily observable, either directly or indirectly. The following table represents the changes in the Level III fair-value category for the three month period ended September 30, 2011.

	Private-label Mortgage-backed securities Held-to-maturity			Impaired Loans			Real Estate Owned
Beginning balance - July 1, 2011	$	-		$	957		$	235
Total net realized/unrealized gains (losses)
Included in earnings
Net realized losses on securities held-to-maturity		(24	)		-			-
Included in other comprehensive income
Net unrealized gains on securities held-to-maturity		(173	)		-			-
Transfers into Level III		997			-			182
Transfers out of Level III		-			(256	)		-
Other - principal paydowns received		-			-			-
Ending balance - September 30, 2011	$	800		$	701		$	417