UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

FORM 10-Q
(Mark One)
☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended:	September 30, ~~2021~~2022
or

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from		to

Commission file number:

001-35019

HOME FEDERAL BANCORP, INC. OF LOUISIANA
(Exact name of registrant as specified in its charter)

Louisiana		02-0815311
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

624 Market Street, Shreveport, Louisiana		71101
(Address of principal executive offices)		(Zip Code)
(318) 222-1145
(Registrant’s telephone number, including area code)
N/A
(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock (par value $0.01 per share)	HFBL	Nasdaq Stock Market, LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check One):

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

☐ Yes

☒ No

Shares of common stock, par value $0.01 per share, outstanding as of November 11 ~~2021:~~, 2022: The registrant had ~~3,352,356~~3,111,745 shares of common stock outstanding.

HOME FEDERAL BANCORP, INC. OF LOUISIANA

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

September 30, 2022 (Unaudited) June 30, 2022 (Audited) (In thousands except share and per share data)

	September 30, 2021 (Unaudited)			June 30, 2021
	(In Thousands)						September 30, 2022			June 30, 2022
							(unaudited)			(audited)
ASSETS
Cash and Cash Equivalents (Includes Interest-Bearing Deposits with Other Banks of $91,713 and $94,325 September 30, 2021 and June 30, 2021, Respectively)	$	101,256		$	104,405

Cash and Cash Equivalents (Includes Interest-Bearing Deposits with Other Banks of $26,710 and $42,531 September 30, 2022 and June 30, 2022, Respectively)							$	37,531		$	64,078
Securities Available-for-Sale		26,974			29,550			30,765			28,099
Securities Held-to-Maturity (Fair Value of $61,775 and $54,608, Respectively)		61,969			54,706
Securities Held-to-Maturity (fair value September 30, 2022: $63,988; June 30, 2022: $69,513, Respectively)								78,073			79,950
Loans Held-for-Sale		10,573			14,427			1,988			3,978
Loans Receivable, Net of Allowance for Loan Losses of $4,127 and $4,122, Respectively		339,424			336,394
Loans Receivable, Net of Allowance for Loan Losses (September 30, 2022: $4,844; June 30, 2022: $4,451, Respectively)								406,373			387,873
Accrued Interest Receivable		1,044			1,163			1,250			1,124
Premises and Equipment, Net		15,811			14,915			16,137			16,249
Bank Owned Life Insurance		7,242			7,214			6,623			6,597
Deferred Tax Asset		554			819			1,466			1,143
Foreclosed Assets		383			383
Other Real Estate Owned								93			-
Other Assets		1,585			1,755			1,286			1,389

Total Assets	$	566,815		$	565,731		$	581,585		$	590,480

LIABILITIES AND STOCKHOLDERS’ EQUITY

LIABILITIES

Deposits:
Non-interest bearing	$	145,214		$	131,014		$	154,740		$	161,142
Interest-bearing		362,369			375,582			369,020			370,849
Total Deposits		507,583			506,596			523,760			531,991
Advances from Borrowers for Taxes and Insurance		527			426			490			354
Short-term Federal Home Loan Bank Advances		35			35			823			832
Long-term Federal Home Loan Bank Advances		824			832
Other Borrowings		1,100			2,400			6,350			2,350
Other Accrued Expenses and Liabilities		3,062			2,717			3,037			2,606

Total Liabilities		513,131			513,006			534,460			538,133

STOCKHOLDERS’ EQUITY
Preferred Stock – $0.01 Par Value; 10,000,000 Shares Authorized; NaN Issued and Outstanding		0			0
Common Stock – $0.01 Par Value; 40,000,000 Shares Authorized; 3,359,856 and 3,350,966 Shares Issued and Outstanding (split adjusted) at September 30, 2021 and June 30, 2021, Respectively		34			34

Preferred Stock – $0.01 Par Value; 10,000,000 Shares Authorized; None Issued and Outstanding								-			-
Common Stock – $0.01 Par Value; 40,000,000 Shares Authorized: 3,108,145 and 3,387,839 Shares Issued and Outstanding at September 30, 2022 and June 30, 2022, Respectively								31			34
Additional Paid-in Capital		37,974			37,583			40,400			40,145
Unearned ESOP Stock		(725	)		(754	)		(610	)		(639	)
Retained Earnings		16,153			15,587			9,881			14,506
Accumulated Other Comprehensive Income		248			275
Accumulated Other Comprehensive Loss								(2,577	)		(1,699	)

Total Stockholders’ Equity		53,684			52,725			47,125			52,347

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	566,815		$	565,731		$	581,585		$	590,480

See accompanying notes to unaudited consolidated financial statements.

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited) (In thousands except share and per share data)

For the Three Months Ended
September 30,

2021

2020

(In Thousands, Except per Share Data)
INTEREST INCOME
Loans, Including Fees $ 4,397 $ 4,647
Investment Securities 0 2
Mortgage-Backed Securities 341 317
Other Interest-Earning Assets 36 18
Total Interest Income 4,774 4,984

INTEREST EXPENSE
Deposits 529 971
Other Borrowings 10 14
Federal Home Loan Bank Borrowings 11 12
Total Interest Expense 550 997
Net Interest Income 4,224 3,987

PROVISION FOR LOAN LOSSES 0 700
Net Interest Income after Provision for Loan Losses 4,224 3,287

NON-INTEREST INCOME
Gain on Sale of Loans 709 1,411
Income on Bank Owned Life Insurance 28 34
Service Charges on Deposit Accounts 268 248
Other Income 11 13
Total Non-Interest Income 1,016 1,706

NON-INTEREST EXPENSE
Compensation and Benefits 2,210 2,214
Occupancy and Equipment 429 376
Data Processing 207 194
Audit and Examination Fees 72 66
Franchise and Bank Shares Tax 130 108
Advertising 74 26
Legal Fees 100 131
Loan and Collection 72 94
Deposit Insurance Premium 38 30
Other Expense 203 184
Total Non-Interest Expense 3,535 3,423
Income Before Income Taxes 1,705 1,570

PROVISION FOR INCOME TAX EXPENSE 352 323
Net Income $ 1,353 $ 1,247
EARNINGS PER COMMON SHARE:
Basic $ 0.42 $ 0.38
Diluted $ 0.38 $ 0.37
DIVIDENDS DECLARED $ 0.10 $ 0.08

	Three Months Ended September 30,
	2022		2021

INTEREST-INCOME
Loans, including fees	$	5,028	$	4,397
Investment securities		2		-
Mortgage-backed securities		489		341
Other interest-earning assets		262		36
Total interest income		5,781		4,774
INTEREST EXPENSE
Deposits		400		529
Federal Home Loan Bank borrowings		10		10
Other bank borrowings		66		11
Total interest expense		476		550
Net interest income		5,305		4,224

PROVISION FOR LOAN LOSSES		418		-
Net interest income after provision for loan losses		4,887		4,224

NON-INTEREST INCOME
Gain on sale of loans		175		709
Income on bank owned life insurance		26		28
Service charges on deposit accounts		335		268
Other income		10		11

Total non-interest income		546		1,016

NON-INTEREST EXPENSE
Compensation and benefits		2,282		2,210
Occupancy and equipment		501		429
Data processing		181		207
Audit and examination fees		75		72
Franchise and bank shares tax		119		130
Advertising		74		74
Legal fees		126		100
Loan and collection		52		72
Deposit insurance premium		47		38
Other expenses		296		203

Total non-interest expense		3,753		3,535

Income before income taxes		1,680		1,705
PROVISION FOR INCOME TAX EXPENSE		9		352

NET INCOME	$	1,671	$	1,353

EARNINGS PER SHARE

Basic	$	0.55	$	0.42
Diluted	$	0.52	$	0.38
DIVIDENDS DECLARED	$	0.12	$	0.10

See accompanying notes to unaudited consolidated financial statements.

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

	For the Three Months Ended September 30,						For the Three Months Ended September 30,
	2021			2020			2022			2021
	(In Thousands)						(In Thousands)

Net Income	$	1,353		$	1,247		$	1,671		$	1,353

Other Comprehensive (Loss) Net of Tax
Other Comprehensive Loss, Net of Tax
Investment securities available-for-sale:
Net unrealized (Losses) Gains		(35	)		(256	)
Income Tax Effect		7			54
Reclassification adjustments for net (gains) losses realized in net income		0			0
Net unrealized losses								(1,109	)		(35	)
Income tax effect		0			0			231			7
Other Comprehensive Loss		(28	)		(202	)		(878	)		(28	)
Total Comprehensive Income	$	1,325		$	1,045		$	793		$	1,325

See accompanying notes to unaudited consolidated financial statements.

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

THREE MONTHS ENDED SEPTEMBER 30, ~~2021~~2022 AND ~~2020~~2021

(Unaudited)

	Common Stock		Additional Paid-in Capital		Unearned ESOP Stock			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Total Stockholders’ Equity			Common Stock			Additional Paid-in Capital		Unearned ESOP Stock			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Total Stockholders’ Equity
								(In Thousands)														(In Thousands)
BALANCE – June 30, 2020	$	22	$	36,531	$	(870	)	$	13,937		$	915		$	50,535
BALANCE – June 30, 2021																	$	34		$	37,701	$	(754	)	$	15,469		$	275		$	52,725

Net Income		0		0		0			1,247			0			1,247			-			-		-			1,353			-			1,353

Changes in Unrealized Gain on Securities Available-for-Sale, Net of Tax Effects		0		0		0			0			(202	)		(202	)		-			-		-			-			(27	)		(27	)

Share Awards Earned		0		0		0			0			0			0

Stock Options Vested		0		34		0			0			0			34			-			26		-			-			-			26

Common Stock Issuance for Stock Option Exercises – Split Adjusted		0		38		0			0			0			38			-			166		-			-			-			166

ESOP Compensation Earned		0		40		29			0			0			69			-			81		29			-			-			110

Company Stock Purchased		0		0		0			(387	)		0			(387	)		-			-		-			(334	)		-			(334	)

Dividends Declared		0		0		0			(282	)		0			(282	)		-			-		-			(335	)		-			(335	)

BALANCE – September 30, 2020	$	22	$	36,643	$	(841	)	$	14,515		$	713		$	51,052
BALANCE – September 30, 2021																	$	34		$	37,974	$	(725	)	$	16,153		$	248		$	53,684

BALANCE – June 30, 2021	$	34	$	37,701	$	(754	)	$	15,469		$	275		$	52,725
BALANCE – June 30, 2022																	$	34		$	40,145	$	(639	)	$	14,506		$	(1,699	)	$	52,347

Net Income		0		0		0			1,353			0			1,353			-			-		-			1,671			-			1,671

Changes in Unrealized Gain on Securities Available-for-Sale, Net of Tax Effects		0		0		0			0			(27	)		(27	)

Share Awards Earned		0		0		0			0			0			0

Stock Split		0		0		0			0			0			0
Changes in Unrealized Loss on Securities Available-for-Sale, Net of Tax Effects																		-			-		-			-			(878	)		(878	)

Stock Options Vested		0		26		0			0			0			26			-			26		-			-			-			26

Common Stock Issuance for Stock Option Exercises		0		166		0			0			0			166			-			147		-			-			-			147

ESOP Compensation Earned		0		81		29			0			0			110			-			82		29			-			-			111

Company Stock Purchased		0		0		0			(334	)		0			(334	)		(3	)		-		-			(5,889	)		-			(5,892	)

Dividends Declared		0		0		0			(335	)		0			(335	)		-			-		-			(407	)		-			(407	)

BALANCE – September 30, 2021	$	34	$	37,856	$	(725	)	$	16,271		$	248		$	53,684
BALANCE – September 30, 2022																	$	31		$	40,400	$	(610	)	$	9,881		$	(2,577	)	$	47,125

See accompanying notes to unaudited consolidated financial statements.

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Three Months Ended						Three Months Ended
	September 30,						September 30,
	2021			2020			2022			2021
	(In Thousands)						(In Thousands)
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income	$	1,353		$	1,247		$	1,671		$	1,353
Adjustments to Reconcile Net Income to Net
Cash (Used in) Provided by Operating Activities
Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities
Bad Debt Recovery		6			52			1			6
Federal Home Loan Bank Stock Certificate		0			(2	)		1			-
Net Amortization and Accretion on Securities		41			44			3			41
Gain on Sale of Loans		(709	)		(1,411	)		(175	)		(709	)
Amortization of Deferred Loan Fees		(426	)		(216	)		(194	)		(426	)
Depreciation of Premises and Equipment		182			168			218			182
ESOP Expense		110			69			111			110
Stock Option Expense		26			34			26			26
Deferred Income Tax		265			(188	)		(323	)		265
Provision for Loan Losses		0			700			418			-
Increase in Cash Surrender Value on Bank Owned Life Insurance		(28	)		(34	)		(26	)		(28	)
Share Awards Expense		32			37			31			32
Changes in Assets and Liabilities:
Loans Held-for-Sale – Originations and Purchases		(28,495	)		(60,258	)		(9,932	)		(28,495	)
Loans Held-for-Sale – Sale and Principal Repayments		33,058			48,625			12,097			33,058
Accrued Interest Receivable		119			238			(126	)		119
Other Operating Assets		170			(264	)		103			170
Other Operating Liabilities		345			429			431			345

Net Cash (Used in) Provided by Operating Activities		6,049			(10,730	)
Net Cash Provided by Operating Activities								4,335			6,049

CASH FLOWS FROM INVESTING ACTIVITIES
Loan Originations and Purchases, Net of Principal Collections		(2,653	)		4,586			(18,717	)		(2,653	)
Deferred Loan Fees Collected		20			67			93			20
Acquisition of Premises and Equipment		(1,078	)		(851	)		(106	)		(1,078	)
Proceeds from Sale of Real Estate		0			0
Activity in Available-for-Sale Securities:
Principal Payments on Mortgage-Backed Securities		2,528			8,488
Principal Payments on Securities								1,610			2,528
Purchase of Securities		0			(5,090	)		(5,376	)		-
Activity in Held-to-Maturity Securities:
Principal Payments on Mortgage-Backed Securities		2,652			2,496
Principal Payments on Securities								1,870			2,652
Purchase of Securities		(9,943	)		0			-			(9,943	)

Net Cash (Used in) Provided by Investing Activities		(8,474	)		9,696
Net Cash Used in Investing Activities								(20,626	)		(8,474	)

See accompanying notes to unaudited consolidated financial statements.

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)

(Unaudited)

	Three Months Ended						Three Months Ended
	September 30,						September 30,
	2021			2020			2022			2021
	(In Thousands)						(In Thousands)
CASH FLOWS FROM FINANCING ACTIVITIES
Net Increase in Deposits	$	987		$	22,895
Net (Decrease)/Increase in Deposits							$	(8,231	)	$	987
Repayments of Advances from Federal Home Loan Bank		(9	)		(77	)		(9	)		(9	)
Proceeds from Other Borrowings		200			700			4,000			200
Repayments of Other Borrowings		(1,500	)		(1,500	)		-			(1,500	)
Net Decrease in Advances from Borrowers for Taxes and Insurance		101			404
Net Increase in Advances from Borrowers for Taxes and Insurance								136			101
Dividends Paid		(335	)		(282	)		(407	)		(335	)
Company Stock Purchased		(334	)		(387	)		(5,892	)		(334	)
Proceeds from Stock Options Exercised		166			38			147			166
Plan Share Distributions		0			0

Net Cash (Used in) Provided by Financing Activities		(724	)		21,791
Net Cash Used in by Financing Activities								(10,256	)		(724	)

NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS		(3,149	)		20,757
NET DECREASE IN CASH AND CASH EQUIVALENTS								(26,547	)		(3,149	)

CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD	$	104,405		$	54,871		$	64,078		$	104,405

CASH AND CASH EQUIVALENTS - END OF PERIOD	$	101,256		$	75,628		$	37,531		$	101,256

SUPPLEMENTARY CASH FLOW INFORMATION
Interest Paid on Deposits and Borrowed Funds	$	553		$	1,008		$	468		$	553
Income Taxes Paid		0			275
Market Value Adjustment for (Loss)/Gain on Debt Securities Available-for-Sale		(35	)		(256	)
Market Value Adjustment for Loss on Securities Available-for-Sale								(1,109	)		(35	)
Transfer from Loans to Other Real Estate Owned								93			-

See accompanying notes to unaudited consolidated financial statements.

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

1. Summary of Accounting Policies

Basis of Presentation

The consolidated financial statements include the accounts of Home Federal Bancorp, Inc. of Louisiana (the “Company”) and its subsidiary, Home Federal Bank (“Home Federal Bank” or the “Bank”). These consolidated financial statements were prepared in accordance with instructions for Form 10-Q and Regulation S-X and do not include information or footnotes necessary for a complete presentation of financial condition, results of operations, and cash flows in conformity with accounting principles generally accepted in the United States of America. However, in the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of the financial statements have been included. The results of operations for the three month period ended September 30, ~~2021~~2022 are not necessarily indicative of the results which may be expected for the fiscal year ending June 30, ~~2022.~~2023.

The Company follows accounting standards set by the Financial Accounting Standards Board (the “FASB”). The FASB sets generally accepted accounting principles (“GAAP”) that we follow to ensure we consistently report our financial condition, results of operations, and cash flows. References to GAAP issued by the FASB in these footnotes are to the FASB Accounting Standards Codification (the “Codification” or the “ASC”).

In accordance with the subsequent events topic of the ASC, the Company evaluates events and transactions that occur after the ~~balance sheet~~statement of financial condition date for potential recognition in the consolidated financial statements. The effect of all subsequent events that provide additional evidence of conditions that existed at the ~~balance sheet~~statement of financial condition date are recognized in the consolidated financial statements as of September 30, ~~2021.~~2022.�� In preparing these consolidated financial statements, the Company evaluated the events and transactions that occurred through the date these consolidated financial statements were issued.

Use of Estimates

In preparing consolidated financial statements in conformity with accounting principles generally accepted in the United States of America, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the Consolidated Statements of Financial Condition and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to the allowance for loan losses.

Nature of Operations

Home Federal Bancorp, Inc. of Louisiana, a Louisiana corporation, is the fully public stock holding company for Home Federal Bank located in Shreveport, Louisiana. The Bank is a federally chartered stock savings and loan association and is subject to federal regulation by the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency. The Company is a savings and loan holding company regulated by the Board of Governors of the Federal Reserve System. Services are provided to the Bank’s customers by 7nine full-service banking offices and home office, located in Caddo, Bossier and ~~Bossier~~Webster Parishes, Louisiana. The area served by the Bank is primarily the Shreveport-Bossier ~~City metropolitan~~City-Minden combined statistical area; however, loan and deposit customers are found dispersed in a wider geographical area covering much of northwest Louisiana. As of September 30, ~~2021,~~2022, the Bank had 1one wholly-owned subsidiary, Metro Financial Services, Inc., which previously engaged in the sale of annuity contracts and does not currently engage in a meaningful amount of business.

Cash and Cash Equivalents

For purposes of the Consolidated Statements of Cash Flows, cash and cash equivalents include cash on hand, balances due from banks, and federal funds sold, all of which mature within ninety days.

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)~~

1. Summary of Accounting Policies (continued)

Securities

Securities are being accounted for in accordance with ~~Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC)~~FASB ASC 320’s, Investments, whichrequires the classification of securities into one of three categories: Trading, Available-for-Sale, or Held-to-Maturity. Management determines the appropriate classification of debt securities at the time of purchase and re-evaluates this classification periodically.

Investments in non-marketable equity securities and debt securities, in which the Company has the positive intent and ability to hold to maturity, are classified as held-to-maturity and carried at cost, adjusted for amortization of the related premiums and accretion of discounts, using the interest method. Investments in debt securities that are not classified as held-to-maturity and marketable equity securities that have readily determinable fair values are classified as either trading or available-for-sale securities.

Securities that are acquired and held principally for the purpose of selling in the near term are classified as trading securities. Investments in securities not classified as trading or held-to-maturity are classified as available-for-sale. Trading account and available-for-sale securities are carried at fair value. Unrealized holding gains and losses on trading securities are included in earnings, while net unrealized holding gains and losses on available-for-sale debt securities are excluded from earnings and reported in other comprehensive income.

The Company held 0no trading securities as of September 30, ~~2021~~2022 and June 30, ~~2021.~~2022.

Purchase premiums and discounts are recognized in interest income using the interest method over the term of the securities.Securities are periodically reviewed for other-than-temporary impairment. For debt securities, management considers whether the present value of future cash flows expected to be collected are less than the security’s amortized cost basis (the difference defined as the credit loss), the magnitude and duration of the decline, the reasons underlying the decline and the Company’s intent to sell the security or whether it is more likely than not that the Company would be required to sell the security before its anticipated recovery in market value, to determine whether the loss in value is other than temporary. If a decline in value is determined to be other than temporary, if the Company does not intend to sell the security, and it is more-likely-than-not that it will not be required to sell the security before recovery of the security’s amortized cost basis, the charge to earnings is limited to the amount of credit loss. Any remaining difference between fair value and amortized cost (the difference defined as the non-credit portion) is recognized in other comprehensive ~~income,~~loss, net of applicable taxes. A decline in value that is considered to be other-than-temporary is recorded as a loss within noninterest income in the consolidated ~~statement~~statements of income.

The Bank has invested in Federal Home Loan Bank (“FHLB”) stock, and other similar correspondent banks, which is reflected at cost in these consolidated financial statements. As a member of the FHLB System, the Bank is required to purchase and maintain stock in an amount determined by the FHLB. The FHLB stock is redeemable at par value at the discretion of the FHLB.

Loans Held-for-Sale

Loans originated and intended for sale in the secondary market are carried at the lower of cost or estimated fair value in the aggregate. Net unrealized losses, if any, are recognized through a valuation allowance by charges to income.

Loans

Loans receivable are stated as unpaid principal balances less allowances for loan losses and unamortized deferred loan fees. Net nonrefundable fees (loan origination fees, commitment fees, discount points) and costs associated with lending activities are being deferred and subsequently amortized into income as an adjustment of yield on the related interest earning assets using the interest method. Interest income on contractual loans receivable is recognized on the accrual method. Unearned discount on property improvement and automobile loans is deferred and amortized on the interest method over the life of the loan.

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)~~

1. Summary of Accounting Policies (continued)

Allowance for Loan Losses

The allowance for loan losses is established as losses are estimated to have occurred through a provision for loan losses charged to earnings. Loan losses are charged against the allowance for loan losses when management believes the uncollectability of a loan balance is confirmed. Subsequent recoveries, if any, are credited to the ~~allowance.~~allowance for loan losses.

The allowance for loan losses is evaluated on a regular basis by management and is based upon management’s periodic review of the collectability of the loans in light of historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of the underlying collateral, and prevailing economic conditions. The evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available. A loan is considered impaired when, based on current information or events, it is probable that the Bank will be unable to collect the scheduled payments of principal and interest when due according to the contractual terms of the loan agreement. When a loan is impaired, the measurement of such impairment is based upon the present value of future cash flows or fair value of the collateral of the loan. If the fair value of the collateral is less than the recorded investment in the loan, the Bank will recognize the impairment by creating a valuation allowance with a corresponding charge against earnings. A loan is considered a troubled debt restructuring (“TDR”) if the Company, for economic or legal reasons related to a debtor’s financial difficulties, grants a concession to the debtor that it would not otherwise consider. Concessions granted under a TDR typically involve a temporary or permanent reduction in payments or interest rate or an extension of a loan’s stated maturity date at less than a current market rate of interest. Loans identified as TDRs are designated as impaired.

An allowance is also established for uncollectible interest on loans classified as substandard. The allowance is established by a charge to interest income equal to all interest previously accrued and income is subsequently recognized only to the extent that cash payments are received. When, in management’s judgment, the borrower’s ability to make periodic interest and principal payments is back to normal, the loan is returned to accrual status.

It should be understood that estimates of future loan losses involve an exercise of judgment. While it is possible that in particular periods the Company may sustain losses which are substantial relative to the allowance for loan losses, it is the judgment of management that the allowance for loan losses reflected in the accompanying consolidated statements of condition is adequate to absorb known and inherent losses in the existing loan portfolio both probable and reasonable to estimate. All loans greater than 90 days past due are generally placed on nonaccrual status.

Off-Balance Sheet Credit Related Financial Instruments

In the ordinary course of business, the Bank has entered into commitments to extend credit. Such financial instruments are recorded when they are funded.

Foreclosed Assets

Assets acquired through, or in lieu of, loan foreclosure are held-for-sale and are transferred to other real estate owned at the lower of cost or current fair value minus estimated ~~cost~~costs to sell as of the date of foreclosure. Cost is defined as the lower of the fair value of the property or the recorded investment in the loan. Subsequent to foreclosure, valuations are periodically performed by management and the assets are carried at the lower of carrying amount or fair value less cost to sell.

Premises and Equipment

Land is carried at cost. Buildings and equipment are carried at cost less accumulated depreciation computed on the straight-line method over the estimated useful lives of the assets. Estimated useful lives are as follows:

Buildings and Improvements		10 - 40 Years
Furniture and Equipment		3 - 10 Years

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)~~

1. Summary of Accounting Policies (continued)

Bank-Owned Life Insurance

The ~~Company~~Bank has purchased life insurance contracts on the lives of certain key employees. The Bank is the beneficiary of these policies. These contracts are reported at their cash surrender value and changes in the cash surrender value are included in non-interest income.

Income Taxes

The Company and its wholly-owned subsidiary file a consolidated Federal income tax return on a fiscal year basis. Each entity pays its pro-rata share of income taxes in accordance with a written tax-sharing agreement.

The Company accounts for income taxes on the asset and liability method. Deferred tax assets and liabilities are recorded based on the difference between the tax basis of assets and liabilities and their carrying amounts for financial reporting purposes, computed using enacted tax rates. A valuation allowance, if needed, reduces deferred tax assets to the expected amount most likely to be realized. Realization of deferred tax assets is dependent upon the generation of a sufficient level of future taxable income and recoverable taxes paid in prior years. Although realization is not assured, management believes it is more likely than not that all of the deferred tax assets will be realized. Current taxes are measured by applying the provisions of enacted tax laws to taxable income to determine the amount of taxes receivable or payable.

The Company follows the provisions of the Income Taxes Topic of the ~~Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC)~~FASB ASC 740. ASC 740 prescribes a recognition threshold and measurement attribute for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return and also provides guidance on various related matters such as derecognition, interest, penalties, and disclosures required. The Company recognizes interest and penalties, if any, related to unrecognized tax benefits in income tax expense.

While the ~~Bank~~Company is exempt from Louisiana income tax, it is subject to the Louisiana Ad Valorem Tax, commonly referred to as the Louisiana Shares Tax, which is based on stockholders’ equity and net income.

Earnings per Share

Earnings per share are computed based upon the weighted average number of common shares outstanding during the period. The Company’s basic and diluted earnings per share were $0.55 and $0.52, respectively, for the three months ended September 30, 2022 compared to basic and diluted earnings per share of $0.42 and $0.38, respectively, for the three months ended September 30, ~~2021 compared to basic and diluted earnings per share (split adjusted) of $0.38 and $0.37, respectively, for the three months ended September 30, 2020.~~

2021.

~~Non-Direct Response Advertising~~

The Company expenses all advertising costs, except for direct-response advertising, as incurred. Non-direct response advertising costs were $74,000 and $26,000 for the three months ended September 30, 2021 and 2020, respectively.

In the event the Company incurs expense for material direct-response advertising, it will be amortized over the estimated benefit period. Direct-response advertising consists of advertising whose primary purpose is to elicit sales to customers who could be shown to have responded specifically to the advertising and results in probable future benefits. For the three months ended September 30, 2021 and 2020, the Company did 0t incur any amount of direct-response advertising.

Stock-Based Compensation

GAAP requires all share-based payments to employees, including grants of employee stock options and recognition and retention share awards, to be recognized as expense in the ~~statement~~consolidated statements of ~~operations~~income based on their fair values. The amount of compensation is measured at the fair value of the options or recognition and retention share awards when granted, and this cost is expensed over the required service period, which is normally the vesting period of the options or recognition and retention awards.

~~Index~~

~~HOME FEDERAL BANCORP, INC. OF LOUISIANA~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)~~

~~1. Summary of Accounting Policies (continued)~~

Reclassification

Certain financial statement balances included in the prior year consolidated financial statements have been reclassified to conform to the current period presentation.

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

1. Summary of Accounting Policies (continued)

Comprehensive Income

Accounting principles generally accepted in the United States of America require that recognized revenue, expenses, gains, and losses be included in net income. Although certain changes in assets and liabilities, such as unrealized gains and losses on available-for-sale debt securities, are reported as a separate component of the equity section of the consolidated ~~balance sheets~~statements of financial conditions along with net income, they are components of comprehensive ~~income (loss).~~income.

Recent Accounting Pronouncements

In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The amendments in this Update replace the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. For public business entities that are SEC filers, the amendments in this Update are effective for fiscal years beginning after December 15, 2022, including interim periods with those fiscal years. The extent of the impact upon adoption is not known and will depend on the characteristics of the Company’s loan portfolio and economic conditions on that date as well as forecasted conditions thereafter. ~~The Company has established an implementation team and are in the process of engaging third-party consultants who have jointly developed a project plan to provide implementation oversight.~~ The Company is in the process of developing and implementing current expected credit loss model that satisfy the requirements of ASU 2016-13. The future adoption of this ASU may have a material effect on the Company’s consolidated financial statements.

~~In December 2019,~~ASU 2022-02, “Financial Instruments - Credit Losses (Topic 326)” (“ASU 2022-02”) eliminates the ~~FASB issued~~guidance on troubled debt restructurings and requires entities to evaluate all loan modifications to determine if they result in a new loan or a continuation of the existing loan. ASU ~~No. 2019-12, "Simplifying the Accounting~~2022-02 also requires that entities disclose current-period gross charge-offs by year of origination for ~~Income Taxes (Topic 740)." The amendments in this~~loans and leases. ASU ~~simplified the accounting for income taxes by removing certain exceptions~~2022-02 is effective January 1, 2023 and is not expected to the general principles in Topic 740. The amendments also improved the consistent application of and simplified GAAP for other areas of Topic 740 by clarifying and amending existing guidance. The amendments in the ASU are effective for fiscal years and interim periods beginning after December 15, 2020. The Company does not expect the adoption of this ASU tohave a significant impact ~~the consolidated~~on our financial ~~statements.~~statement disclosures.

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)~~

2. Securities

The amortized cost and fair value of securities with gross unrealized gains and losses follows:

	September 30, 2021									September 30, 2022
				Gross		Gross						Gross		Gross
	Amortized			Unrealized		Unrealized		Fair		Amortized		Unrealized		Unrealized		Fair
Securities Available-for-Sale	Cost			Gains		Losses		Value		Cost		Gains		Losses		Value
				(In Thousands)								(In Thousands)
Debt Securities
FHLMC Mortgage-Backed Certificates	$	3,761		$	24	$	0	$	3,785	$	12,015	$	-	$	858	$	11,157
FNMA Mortgage-Backed Certificates		16,892			439		28		17,303		16,691		-		1,607		15,084
GNMA Mortgage-Backed Certificates		6,007			1		122		5,886		4,751		-		772		3,979
Debt Securities

Total Debt Securities		26,660			464		150		26,974		33,457		-		3,237		30,220

Municipals											569		-		24		545

Total Securities Available-for-Sale	$	26,660		$	464	$	150	$	26,974	$	34,026	$	-	$	3,261	$	30,765

Securities Held-to-Maturity

Debt Securities
GNMA Mortgage-Backed Certificates	$	778	��	$	10	$	0	$	788	$	636	$	-	$	68	$	568
FHLMC Mortgage-Backed Certificates		19,603			59		198		19,464		31,718		-		6,175		25,543
FNMA Mortgage-Backed Certificates		39,707			562		651		39,618		43,847		-		7,711		36,136

Total Debt Securities		60,088			631		849		59,870		76,201		-		13,954		62,247

Municipals		1,354			24		0		1,378		1,330		-		131		1,199

Other Securities (Non-Marketable)
27,770 Shares – Federal Home Loan Bank		277			0		0		277
Equity Securities (Non-Marketable)
2,920 Shares – Federal Home Loan Bank											292		-		-		292
630 Shares – First National Bankers Bankshares, Inc.		250			0		0		250		250		-		-		250

Total Other Securities		527			0		0		527
Total Equity Securities											542		-		-		542

Total Securities Held-to-Maturity	$	61,969		$	655	$	849	$	61,775	$	78,073	$	-	$	14,085	$	63,988

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)~~

2. Securities (continued)

June 30, 2021
Gross Gross
Amortized Unrealized Unrealized Fair
Securities Available-for-Sale
Cost Gains Losses Value
(In Thousands)
Debt Securities
FHLMC Mortgage-Backed Certificates $ 4,188
$ 33
$ 0
$ 4,221

FNMA Mortgage-Backed Certificates 18,666
486
0
19,152

GNMA Mortgage-Backed Certificates 6,347
1
171
6,177

Total Debt Securities 29,201
520
171
29,550

Total Securities Available-for-Sale $ 29,201
$ 520
$ 171
$ 29,550

Securities Held-to-Maturity

Debt Securities

GNMA Mortgage-Backed Securities $
782
$
17
$
0
$
799

FHLMC Mortgage-Backed Certificates
9,876

0

277

9,599
FNMA Mortgage-Backed Securities
42,160

641

500

42,301

Total Debt Securities
52,818

658

777

52,699

Municipals
1,361

21

0

1,382

Equity Securities (Non-Marketable)
2,766 Shares – Federal Home Loan Bank
277

0

0

277

630 Shares – First National Bankers Bankshares, Inc.
250

0

0

250

Total Equity Securities 527

0

0

527

Total Securities Held-to-Maturity $
54,706
$
679
$
777
$
54,608

	June 30, 2022
			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
Securities Available-for-Sale	Cost		Gains		Losses		Value
	(In Thousands)
Debt Securities
FHLMC Mortgage-Backed Certificates	$	7,513	$	1	$	482	$	7,032
FNMA Mortgage-Backed Certificates		17,753		-		1,067		16,686
GNMA Mortgage-Backed Certificates		4,984		-		603		4,381

Total Debt Securities		30,250		1		2,152		28,099

Total Securities Available-for-Sale	$	30,250	$	1	$	2,152	$	28,099

Securities Held-to-Maturity

Debt Securities
GNMA Mortgage-Backed Certificates	$	640	$	-	$	40	$	600
FHLMC Mortgage-Backed Certificates		32,485		-		4,602		27,883
FNMA Mortgage-Backed Certificates		44,947		-		5,693		39,254

Total Debt Securities		78,072		-		10,335		67,737

Municipals		1,336		-		102		1,234

Equity Securities (Non-Marketable)
2,919 Shares – Federal Home Loan Bank		292		-		-		292
630 Shares – First National Bankers Bankshares, Inc.		250		-		-		250

Total Equity Securities		542		-		-		542

Total Securities Held-to-Maturity	$	79,950	$	-	$	10,437	$	69,513

The amortized cost and fair value of securities by contractual maturity at September 30, ~~2021~~2022 follows:

	Available-for-Sale				Held-to-Maturity				Available-for-Sale				Held-to-Maturity
	Amortized		Fair		Amortized		Fair		Amortized		Fair		Amortized		Fair
	Cost		Value		Cost		Value		Cost		Value		Cost		Value
			(In Thousands)								(In Thousands)

Debt Securities
Within One Year or Less	$	0	$	0	$	0	$	0	$	-	$	-	$	-	$	-
One through Five Years		861		868		0		0		5		5		-		-
After Five through Ten Years		51		55		0		0		1,274		1,196		-		-
Over Ten Years		25,748		26,051		60,088		59,870		32,178		29,019		76,201		62,247
		26,660		26,974		60,088		59,870		33,457		30,220		76,201		62,247

Municipals
Within One Year or Less	$	0	$	0	$	0	$	0	$	-	$	-	$	-	$	-
One through Five Years		0		0		234		239		-		-		227		213
After Five through Ten Years		0		0		0		0		-		-		-		-
Over Ten Years		0		0		1,120		1,139		569		545		1,103		986
		0		0		1,354		1,378		569		545		1,330		1,199

Other Equity Securities		0		0		527		527		-		-		542		542

Total	$	26,660	$	26,974	$	61,969	$	61,775	$	34,026	$	30,765	$	78,073	$	63,988

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)~~

2. Securities (continued)

Securities ~~held-to-maturity~~available-for-sale totaling ~~$9.9~~$5.4 million were purchased during the three months ~~ending~~ended September 30, ~~2021.~~

2022. There were no securities sold during the three months ended September 30, 2022.The following tables show information pertaining to gross unrealized losses on securities available-for-sale at September 30, ~~2021~~2022 and June 30, ~~2021~~2022 aggregated by investment category and length of time that individual securities have been in a continuous loss position.

	September 30, 2021								September 30, 2022
	Less Than Twelve Months				Over Twelve Months				Less Than Twelve Months				Over Twelve Months
	Gross				Gross				Gross				Gross
	Unrealized		Fair		Unrealized		Fair		Unrealized		Fair		Unrealized		Fair
	Losses		Value		Losses		Value		Losses		Value		Losses		Value
	(In Thousands)								(In Thousands)
Securities Available-for-Sale

Mortgage-Backed Securities	$	122	$	6,732	$	28	$	1,504	$	2,030	$	24,515	$	1,207	$	5,693

Municipals										24		544		-		-

Total Securities Available-for-Sale	$	122	$	6,732	$	28	$	1,504	$	2,054	$	25,059	$	1,207	$	5,693

September 30, 2021
Less Than Twelve Months Over Twelve Months
Gross Gross
Unrealized Fair Unrealized Fair
Losses Value Losses Value
(In Thousands)
Securities Held-to-Maturity

Mortgage-Backed Securities $ 849 $ 49,887 $ 0 $ 0

Total Securities Held-to-Maturity
$ 849 $ 49,887 $ 0 $ 0

June 30, 2021
Less Than Twelve Months Over Twelve Months
Gross Gross
Unrealized Fair Unrealized Fair
Losses Value Losses Value
(In Thousands)
Securities Available-for-Sale

Mortgage-Backed Securities $ 139 $ 4,522 $ 32 $ 1,633

Total Securities Available-for-Sale
$ 139 $ 4,522 $ 32 $ 1,633

June 30, 2021
Less Than Twelve Months Over Twelve Months
Gross Gross
Unrealized Fair Unrealized Fair
Losses Value Losses Value
(In Thousands)
Securities Held-to-Maturity

Mortgage-Backed Securities $ 777 $ 41,154 $ 0 $ 0

Total Securities Held-to-Maturity
$ 777 $ 41,154 $ 0 $ 0

	September 30, 2022
	Less Than Twelve Months				Over Twelve Months
	Gross				Gross
	Unrealized		Fair		Unrealized		Fair
	Losses		Value		Losses		Value
	(In Thousands)
Securities Held-to-Maturity

Mortgage-Backed Securities	$	5,831	$	29,257	$	8,123	$	32,990

Municipals		-		-		131		1,199

Total Securities Held-to-Maturity	$	5,831	$	29,257	$	8,254	$	34,189

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)~~

2. Securities (continued)

	June 30, 2022
	Less Than Twelve Months				Over Twelve Months
	Gross				Gross
	Unrealized		Fair		Unrealized		Fair
	Losses		Value		Losses		Value
	(In Thousands)
Securities Available-for-Sale

Mortgage-Backed Securities	$	1,335	$	21,813	$	816	$	6,286

Total Securities Available-for-Sale	$	1,335	$	21,813	$	816	$	6,286

	June 30, 2022
	Less Than Twelve Months				Over Twelve Months
	Gross				Gross
	Unrealized		Fair		Unrealized		Fair
	Losses		Value		Losses		Value
	(In Thousands)
Securities Held-to-Maturity

Mortgage-Backed Securities	$	4,591	$	35,930	$	5,744	$	31,807

Municipals	$	102	$	1,234	$	-	$	-

Total Securities Held-to-Maturity	$	4,693	$	37,164	$	5,744	$	31,807

The unrealized losses on the Company’s investment in mortgage-backed securities at September 30, ~~2021~~2022 and June 30, ~~2021~~2022 were caused by interest rate changes. The contractual cash flows of these investments are guaranteed by agencies of the U.S. Government. Accordingly, it is expected that these securities would not be settled at a price less than the amortized cost of the Company’s investment. Because the decline in market value is attributable to changes in interest rates and not credit quality and because the Company has the ability and intent to hold these investments until a recovery of fair value, which may be maturity, the Company does not consider these investments to be other-than-temporarily impaired at September 30, ~~2021.~~2022.

The Company’s investment in equity securities consists primarily of FHLB stock and shares of First National Bankers Bankshares, Inc. (“FNBB”). Management monitors its investment portfolio to determine whether any investment securities which have unrealized losses should be considered other than temporarily impaired.

At September 30, ~~2021,~~2022, securities with a carrying value of ~~$800,000~~$563,000 were pledged to secure public deposits and securities and mortgage loans with a carrying value of ~~$159.4~~$215.4 million were pledged to secure FHLB advances.

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)~~

3. Loans Receivable

Loans receivable are summarized as follows:

	September 30, 2021			June 30, 2021			September 30, 2022			June 30, 2022
	(In Thousands)						(In Thousands)
Loans Secured by Mortgages on Real Estate
One-to-Four Family Residential	$	108,804		$	97,607		$	126,511		$	120,014
Commercial		106,033			96,180			141,465			127,589
Multi-Family Residential		30,409			31,015			28,618			30,411
Land		14,354			16,260			22,752			22,127
Construction		15,552			15,337			26,913			27,884
Equity and Second Mortgage		1,232			1,267			1,630			1,587
Equity Lines of Credit		12,436			12,788			18,965			17,831

Total Mortgage Loans		288,820			270,454			366,854			347,443

Commercial Loans		54,184			69,891			43,868			44,487
Consumer Loans
Loans on Savings Accounts		414			430			209			266
Other Consumer Loans		471			485			497			439

Total Consumer Other Loans		885			915			706			705
Total Loans		343,889			341,260			411,428			392,635

Less: Allowance for Loan Losses		(4,127	)		(4,122	)		(4,844	)		(4,451	)
Unamortized Loan Fees		(338	)		(744	)		(211	)		(311	)

Net Loans Receivable	$	339,424		$	336,394		$	406,373		$	387,873

Following is a summary of changes in the allowance for loan losses:

	Three Months Ended September 30,
	2021		2020			September 30, 2022			June 30, 2022
	(In Thousands)					(In Thousands)

Balance - Beginning of Period	$	4,122	$	4,081		$	4,451		$	4,122
Provision for Loan Losses		0		700			418			336
Loan Charge-Offs		0		(280	)		(26	)		(31	)
Recoveries		5		52			1			24
Balance - End of Period	$	4,127	$	4,553		$	4,844		$	4,451

Credit Quality Indicators

The Company segregates loans into risk categories based on the pertinent information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. The Company analyzes loans individually by classifying the loans according to credit risk. Once a loan has been classified as substandard or identified as special mention, management will conduct a quarterly review to evaluate the level of deterioration, improvement, and impairment, if any, as well as assign the appropriate risk category. The delinquent loan report is monitored monthly to determine if any loan needs to be evaluated for classification or impairment.

Loans excluded from the scope of the quarterly review process above are generally identified as pass credits until: (a) they become past due; (b) management becomes aware of deterioration in the credit worthiness of the borrower; or (c) the customer contacts the Company for a modification. In these circumstances, the loan is specifically evaluated for potential classification and the need to allocate reserves or charge-off. All loans greater than 90 days past due are generally placed on nonaccrual status. The Company uses the following definitions for risk ratings:

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)~~

3. Loans Receivable (continued)

Credit Quality Indicators (continued)

Pass - Loans classified as pass are well protected by the current net worth or paying capacity of the obligor or by the fair value, less ~~cost~~costs to acquire and sell the underlying collateral in a timely manner.

Pass Watch - Loans are considered marginal, meaning some weakness has been identified which could cause future impairment of repayment. However, these relationships are currently protected from any apparent loss by collateral.

Special Mention - Loans identified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the ~~institution’s~~Bank’s credit position at some future date.

Substandard - Loans classified as substandard are inadequately protected by the current net worth and payment capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the ~~institution~~Bank will sustain some loss if the deficiencies are not corrected.

Doubtful - Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

Loss - This classification includes those loans which are considered uncollectible and of such little value that their continuance as loans is not warranted. Even though partial recovery may be possible in the future, it is not practical or desirable to defer writing off these basically worthless loans. Accordingly, these loans are charged-off before period end.

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

3. Loans Receivable (continued)

Credit Quality Indicators (continued)

The following tables present the grading of loans, segregated by class of loans, as of September 30, ~~2021~~2022 and June 30, ~~2021:~~2022:

September 30, 2021	Pass and Pass Watch			Special Mention		Substandard		Doubtful		Total
	(In Thousands)
September 30, 2022												Pass and Pass Watch		Special Mention		Substandard		Doubtful		Total
												(In Thousands)
Real Estate Loans:			��
One-to-Four Family Residential	$	108,317		$	357	$	130	$	0	$	108,804	$	124,041	$	348	$	2,122	$	-	$	126,511
Commercial		103,353			0		2,680		0		106,033		137,098		2,652		1,715		-		141,465
Multi-Family Residential		30,409			0		0		0		30,409		28,618		-		-		-		28,618
Land		14,354			0		0		0		14,354		22,752		-		-		-		22,752
Construction		15,552			0		0		0		15,552		26,913		-		-		-		26,913
Equity and Second Mortgage		1,232			0		0		0		1,232		1,630		-		-		-		1,630
Equity Lines of Credit		12,436			0		0		0		12,436		18,965		-		-		-		18,965
Commercial Loans		51,440			2,744		0		0		54,184		43,868		-		-		-		43,868
Consumer Loans		885			0		0		0		885		706		-		-		-		706

Total	$	337,978		$	3,101	$	2,810	$	0	$	343,889	$	404,591	$	3,000	$	3,837	$	-	$	411,428

~~Index~~

~~HOME FEDERAL BANCORP, INC. OF LOUISIANA~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)~~

~~3. Loans Receivable (continued)~~

~~Credit Quality Indicators (continued)~~

June 30, 2021	Pass and Pass Watch		Special Mention		Substandard		Doubtful		Total
June 30, 2022											Pass and Pass Watch		Special Mention		Substandard		Doubtful		Total
	(In Thousands)										(In Thousands)
Real Estate Loans:
One-to-Four Family Residential	$	97,115	$	358	$	134	$	0	$	97,607	$	117,464	$	352	$	2,198	$	-	$	120,014
Commercial		93,468		0		2,712		0		96,180		123,292		2,548		1,749		-		127,589
Multi-Family Residential		31,015		0		0		0		31,015		30,411		-		-		-		30,411
Land		16,260		0		0		0		16,260		22,127		-		-		-		22,127
Construction		15,337		0		0		0		15,337		27,884		-		-		-		27,884
Equity and Second Mortgage		1,267		0		0		0		1,267		1,587		-		-		-		1,587
Equity Lines of Credit		12,788		0		0		0		12,788		17,831		-		-		-		17,831
Commercial Loans		67,087		2,804		0		0		69,891		44,275		212		-		-		44,487
Consumer Loans		915		0		0		0		915		705		-		-		-		705

Total	$	335,252	$	3,162	$	2,846	$	0	$	341,260	$	385,576	$	3,112	$	3,947	$	-	$	392,635

Factors considered by management in determining impairment include payment status, collateral value, and the probability of collecting scheduled principal and interest payments when contractually due. Loans that experience insignificant payment delays or payment shortfalls are generally not classified as impaired. On a case-by-case basis, management determines the significance of payment delays and payment shortfalls, taking into consideration all of the circumstances related to the loan, including the length of the payment delay, the reasons for the delay, the borrower’s prior payment record, and the amount of the shortfall in relation to the principal and interest owed.

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

3. Loans Receivable (continued)

Credit Quality Indicators (continued)

The following tables present an aging analysis of past due loans, segregated by class of loans, as of September 30, ~~2021~~2022 and June 30, ~~2021:~~2022:

September 30, 2021	30-59 Days Past Due		60-89 Days Past Due		90 Days or More		Total Past Due		Current		Total Loans Receivable		Recorded Investment >90 Days and Accruing
September 30, 2022															30-59 Days Past Due		60-89 Days Past Due		90 Days or More		Total Past Due		Current		Total Loans Receivable		Recorded Investment > 90 Days and Accruing
	(In Thousands)														(In Thousands)
Real Estate Loans:
One-to-Four Family Residential	$	0	$	427	$	139	$	566	$	108,238	$	108,804	$	139	$	191	$	655	$	1,850	$	2,696	$	123,815	$	126,511	$	-
Commercial		0		0		837		837		105,196		106,033		837		-		-		-		-		141,465		141,465		-
Multi-Family Residential		0		0		0		0		30,409		30,409		0		-		-		-		-		28,618		28,618		-
Land		0		0		0		0		14,354		14,354		0		-		-		-		-		22,752		22,752		-
Construction		0		0		0		0		15,552		15,552		0		-		-		-		-		26,913		26,913		-
Equity and Second Mortgage		0		0		0		0		1,232		1,232		0		-		-		-		-		1,630		1,630		-
Equity Lines of Credit		15		0		0		15		12,421		12,436		0		-		-		-		-		18,965		18,965		-
Commercial Loans		0		0		0		0		54,184		54,184		0		-		208		-		208		43,660		43,868		-
Consumer Loans		0		0		0		0		885		885		0		-		-		-		-		706		706		-

Total	$	15	$	427	$	976	$	1,418	$	342,471	$	343,889	$	976	$	191	$	863	$	1,850	$	2,904	$	408,524	$	411,428	$	-

~~Index~~

~~HOME FEDERAL BANCORP, INC. OF LOUISIANA~~

June 30, 2022	30-59 Days Past Due		60-89 Days Past Due		90 Days or More		Total Past Due		Current		Total Loans Receivable		Recorded Investment > 90 Days and Accruing
	(In Thousands)
Real Estate Loans:
One-to-Four Family Residential	$	-	$	1,923	$	387	$	2,310	$	117,704	$	120,014	$	26
Commercial		-		-		-		-		127,589		127,589		-
Multi-Family Residential		-		-		-		-		30,411		30,411		-
Land		-		-		-		-		22,127		22,127		-
Construction		-		-		-		-		27,884		27,884		-
Equity and Second Mortgage		-		-		-		-		1,587		1,587		-
Equity Lines of Credit		24		-		-		24		17,807		17,831		-
Commercial Loans		-		-		-		-		44,487		44,487		-
Consumer Loans		-		-		-		-		705		705		-

Total	$	24	$	1,923	$	387	$	2,334	$	390,301	$	392,635	$	26

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)~~

~~3. Loans Receivable (continued)~~

~~Credit Quality Indicators (continued)~~

June 30, 2021
30-59 Days
Past Due

60-89 Days
Past Due

90 Days or
More

Total
Past Due

Current

Total
Loans
Receivable

Recorded
Investment
> 90 Days
and
Accruing

(In Thousands)
Real Estate Loans:
One-to-Four Family Residential $
0 $ 30 $ 176 $ 206 $ 97,401 $ 97,607 $ 33
Commercial 0 0 837 837 95,343 96,180 0
Multi-Family Residential 0 0 0 0 31,015 31,015 0
Land 0 0 0 0 16,260 16,260 0
Construction 0 0 0 0 15,337 15,337 0
Equity and Second Mortgage 0 0 0 0 1,267 1,267 0
Equity Lines of Credit 0 0 0 0 12,788 12,788 0
Commercial Loans 0 0 0 0 69,891 69,891 0
Consumer Loans 0 0 0 0 915 915 0

Total $ 0
$ 30
$ 1,013
$ 1,043
$ 340,217
$ 341,260
$ 33

There was 0no interest income recognized on non-accrual loans during the three months ended September 30, ~~2021~~2022 or the year ended June 30, ~~2021.~~2022. If the non-accrual loans had been accruing interest at their original contracted rates, gross interest income that would have been recorded for the three months ended September 30, ~~2021~~2022 and the year ended June 30, ~~2021~~2022 was approximately ~~$10,000~~$2,000 and ~~$63,000,~~$54,000, respectively.

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

3. Loans Receivable (continued)

Credit Quality Indicators (continued)

The change in the allowance for loan losses by loan portfolio class and recorded investment in loans for the three months ended September 30, ~~2021~~2022 and year ended June 30, ~~2021~~2022 was as follows:

	Real Estate Loans																						Real Estate Loans
September 30, 2021	1-4 Family Residential		Commercial		Multi- Family			Land			Construction			Home Equity Loans and Lines of Credit			Commercial Loans		Consumer Loans		Total
September 30, 2022																							1-4 Family Residential		Commercial		Multi- Family			Land		Construction			Home Equity Loans and Lines of Credit			Commercial Loans			Consumer Loans		Total
								(In Thousands)																						(In Thousands)
Allowance for loan losses:
Beginning Balances	$	894	$	1,630	$	346		$	407		$	160		$	193		$	489	$	3	$	4,122	$	1,367	$	1,295	$	357		$	305	$	282		$	197		$	646		$	2	$	4,451
Charge-Offs		0		0		0			0			0			0			0		0		0		-		-		-			-		-			(26	)		-			-		(26	)
Recoveries		1		0		0			0			0			4			0		0		5		1		-		-			-		-			-			-			-		1
Current Provision		73		24		(20	)		(72	)		(4	)		(19	)		18		0		0		139		342		(86	)		13		(8	)		51			(33	)		-		418
Ending Balances	$	968	$	1,654	$	326		$	335		$	156		$	178		$	507	$	3	$	4,127	$	1,507	$	1,637	$	271		$	318	$	274		$	222		$	613		$	2	$	4,844

Evaluated for Impairment:
Individually		0		301		0			0			0			0			232		0		533		222		127		-			-		-			-			132			-		481
Collectively		968		1,353		326			335			156			178			275		3		3,594		1,285		1,510		271			318		274			222			481			2		4,363

Loans Receivable:
Ending Balances – Total	$	108,804	$	106,033	$	30,409		$	14,354		$	15,552		$	13,668		$	54,184	$	885	$	343,889	$	126,511	$	141,465	$	28,618		$	22,752	$	26,913		$	20,595		$	43,868		$	706	$	411,428
Ending Balances:
Evaluated for Impairment:
Individually		487		2,680		0			0			0			0			2,744		0		5,911		2,471		4,159		-			-		-			-			208			-		6,838
Collectively	$	108,317	$	103,353	$	30,409		$	14,354		$	15,552		$	13,668		$	51,440	$	885	$	337,978	$	124,040	$	137,306	$	28,618		$	22,752	$	26,913		$	20,595		$	43,660		$	706	$	404,590

1-4 Family

Residential

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)~~

3. Loans Receivable (continued)

Credit Quality Indicators (continued)

Real Estate Loans

June 30, 2021

1-4 Family
Residential

Commercial

Multi-
Family

Land

Construction

Home
Equity
Loans And
Lines of
Credit

Commercial
Loans

Consumer
Loans

Total

(In Thousands)
Allowance for loan losses:
Beginning Balances $ 966 $ 568 $ 364 $ 1,024 $ 80 $ 126 $ 949 $ 4 $ 4,081
Charge-Offs (40 ) 0 0 (907 ) 0 0 (1,014 ) 0 (1,961 )
Recoveries 3 0 0 120 0 5 74 0 202
Current Provision (35 ) 1,062
(18 ) 170
80
62
480
(1 ) 1,800

Ending Balances $ 894 $ 1,630 $ 346 $ 407 $ 160 $ 193 $ 489 $ 3 $ 4,122

Evaluated for Impairment:
Individually 0 317 0 0 0 0 251 0 568
Collectively 894 1,313 346 407 160 193 238 3 3,554

Loans Receivable:
Ending Balances – Total $ 97,607 $ 96,180 $ 31,015 $ 16,260 $ 15,337 $ 14,055 $ 69,891 $ 915 $ 341,260
Ending Balances:
Evaluated for Impairment:
Individually 492 2,712 0 0 0 0
2,804 0 6,008

Collectively $ 97,115 $ 93,468 $ 31,015 $ 16,260 $ 15,337 $ 14,055 $ 67,087 $ 915 $ 335,252

The following tables present loans individually evaluated for impairment, segregated by class of loans, as of September 30, ~~2021~~2022 and June 30, ~~2021:~~2022:

Unpaid

Principal

Balance

Recorded

Investment With

No Allowance

Recorded

Investment With

Allowance

Total

Recorded

Investment

Average Recorded

Investment

Unpaid

Principal

Balance

Recorded

Investment With

No Allowance

Recorded

Investment With

Allowance

Total

Recorded

Investment

Average Recorded

Investment

~~HOME FEDERAL BANCORP, INC. OF LOUISIANA~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)~~

~~3. Loans Receivable (continued)~~

~~Credit Quality Indicators (continued)~~

The Bank has no commitments to loan additional funds to borrowers whose loans were previously in non-accrual status. As of September 30, ~~2021,~~2022, there were 0no residential loans in the process of foreclosure.

HOME FEDERAL BANCORP, INC. OF LOUISIANA

Credit Quality Indicators (continued)

A troubled debt restructuring (“TDR”) is a restructuring of a debt made by the Company to a debtor for economic or legal reasons related to the debtor’s financial difficulties that it would not otherwise consider. The Company grants the concession in an attempt to protect as much of its investment as possible.

Information about the Company’s TDRs is as follows (in thousands):

September 30, 2021
Current
Past Due Greater
Than 30 Days

Nonaccrual
TDRs
Total TDRs
Commercial real estate $
0 $
837 $
837 $
837

	September 30, 2022
	Current		Past Due Greater Than 30 Days		Nonaccrual TDRs		Total TDRs
One-to-Four Family	$	-	$	1,751	$	1,751	$	1,751
Commercial Loans		-		208		-		208

June 30, 2021
Current
Past Due Greater
Than 30 Days

Nonaccrual
TDRs
Total TDRs
Commercial business $ 0
$ 837
$ 837
$ 837

	June 30, 2022
	Current		Past Due Greater Than 30 Days		Nonaccrual TDRs		Total TDRs
One-to-Four Family	$	-	$	1,818	$	1,818	$	1,818
Commercial Loans		212		-		212		212

For purposes of the determination of an allowance for loan losses on these TDRs, as an identified TDR, the Company considers a loss probable on the loan and, as a result, the loan is reviewed for specific impairment in accordance with the Company’s allowance for loan loss methodology. If it is determined losses are probable on such TDRs, either because of delinquency or other credit quality indicator, the Company establishes specific reserves for these loans. As of September 30, ~~2021,~~2022, there were 0no commitments to lend additional funds to debtors owing sums to the Company whose terms have been modified in TDRs. The Company had ~~0 trouble debt restructuring~~no TDR that has subsequently ~~defaulted~~defaulted in the last 12 months.There was one loan secured by real estate in foreclosure.

~~Loan Modifications/Troubled Debt Restructurings~~. Under the CARES Act, loans less than 30 days past due as of December 31, 2019 will be considered current for COVID-19 modifications. A financial institution can then suspend the requirements under GAAP for loan modifications related to COVID-19 that would otherwise be categorized as a troubled debt restructuring (“TDR”), and suspend any determination of a loan modified as a result of COVID-19 as being a TDR, including the requirement to determine impairment for accounting purposes. Financial institutions wishing to utilize this authority must make a policy election, which applies to any COVID-19 modification made between March 1, 2020 and the earlier of either January 1, 2022 or the 60th day after the end of the COVID-19 national emergency. Home Federal Bank has made that election. Similarly, the Financial Accounting Standards Board has confirmed that short-term modifications made on a good-faith basis in response to COVID-19 to loan customers who were current prior to any relief will not be considered TDRs.

Prior to the enactment of the CARES Act, the banking regulatory agencies provided guidance as to how certain short-term modifications would not be considered TDRs, and have subsequently confirmed that such guidance could be applicable for loans that do not qualify for favorable accounting treatment under Section 4013 of the CARES Act.

HOME FEDERAL BANCORP, INC. OF LOUISIANA

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)~~

4. Deposits

Deposits at September 30, ~~2021~~2022 and June 30, ~~2021~~2022 consist of the following classifications:

	September 30, 2021		June 30, 2021		September 30, 2022		June 30, 2022
	(In Thousands)				(In Thousands)
Non-Interest Bearing	$	145,214	$	131,014	$	154,740	$	161,142
NOW Accounts		47,698		49,262		64,525		58,957
Money Markets		85,120		88,181		96,477		98,627
Passbook Savings		134,711		129,130		119,896		132,981
		412,743		397,587		435,638		451,707

Certificates of Deposit		94,840		109,009		88,122		80,284

Total Deposits	$	507,583	$	506,596	$	523,760	$	531,991

5. Earnings Per Share

Home Federal Bank announced that its Board of Directors declared a 2-for-one stock split in the form of a 100% stock dividend, payable March 31, 2021, to stockholders of record as of March 22, 2021. Under the terms of the stock split, the Company’s stockholders received a dividend of 1 share for every share held on the record date. The dividend was paid in authorized but unissued shares of common stock of the Company. The par value of the Company's stock was not affected by the split and will remain at $0.01 per share. The outstanding shares of stock after the split increased from approximately 1.7 million shares to 3.4 million shares.

Basic earnings per common share ~~are~~is computed based on the weighted average number of shares outstanding. Diluted earnings per share is computed based on the weighted average number of shares outstanding and common share equivalents that would arise from the exercise of dilutive securities. Earnings per share for the three months ended September 30, ~~2021~~2022 and ~~2020~~2021 were calculated as follows:

	Three Months Ended September 30,				Three Months Ended September 30,
	2021		2020		2022		2021
	(In Thousands, Except Per Share Data)				(In Thousands, Except Per Share Data)

Net income	$	1,353	$	1,247	$	1,671	$	1,353

Weighted average shares outstanding – basic		3,204		3,262		3,066		3,204
Effect of dilutive common stock equivalents		310		128		162		310
Adjusted weighted average shares outstanding – diluted		3,514		3,390		3,228		3,514

Basic earnings per share	$	0.42	$	0.38	$	0.55	$	0.42
Diluted earnings per share	$	0.38	$	0.37	$	0.52	$	0.38

For the three months ended September 30, ~~2021~~2022 and ~~2020,~~2021, there were outstanding options to purchase ~~626,132~~389,616 and ~~520,322~~626,132 shares, respectively, at a weighted average exercise price of ~~$9.96~~$11.81 and ~~$9.18~~$9.96 per share, respectively. For the quarter ended September 30, 2022 and 2021, ~~and 2020, 310,552~~161,866 options and ~~127,762~~310,552 options, respectively, were included in the computation of diluted earnings per share.

~~Index~~

~~HOME FEDERAL BANCORP, INC. OF LOUISIANA~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)~~

~~5. Earnings Per Share (continued)~~

The following table presents the components of weighted average outstanding shares for purposes of calculating earnings per share:

	Three Months Ended September 30,						Three Months Ended September 30,
	2021			2020			2022			2021
	(In Thousands)						(In Thousands)

Average common shares issued		6,125			6,125			6,125			6,125
Average unearned ESOP shares		(148	)		(171	)		(125	)		(148	)
Average unearned RRP shares		0			0
Average Company stock purchased		(2,773	)		(2,692	)		(2,934	)		(2,773	)

Weighted average shares outstanding		3,204			3,262			3,066			3,204

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

6. Stock-Based Compensation

Stock Option ~~Plan~~Plans

On August 10, 2005, the ~~shareholders~~stockholders of the Company approved the establishment of the Home Federal Bancorp, Inc. of Louisiana 2005 Stock Option Plan (the “2005 Option Plan”) for the benefit of directors, officers, and other key employees. The aggregate number of shares of common stock reserved for issuance under the 2005 Option Plan totaled 317,736 (as adjusted). Both incentive stock options and non-qualified stock options may be granted under the 2005 Option Plan. The 2005 Stock Option Plan terminated on June 8, ~~2015,~~2015; however, the ~~866~~4,266 outstanding options as of September 30, ~~2021~~2022 will remain in effect for the remainder of their original ten year terms.

On December 23, 2011, the ~~shareholders~~stockholders of the Company approved the establishment of the Home Federal Bancorp, Inc. of Louisiana 2011 Stock Option Plan (the “2011 Option Plan,” together with the 2005 Option Plan, the “Option Plans”) for the benefit of directors, officers, and other key employees. The aggregate number of shares of common stock reserved for issuance under the 2011 Option Plan totaled ~~389,044. Both incentive stock options and non-qualified stock options may be granted under the~~389,044 (as adjusted). The 2011 Option ~~Plan. As~~Plan terminated on December 23, 2021; however, the 38,350 outstanding options as of September 30, ~~2021, there were 778 stock options available~~2022 will remain in effect for ~~future grant under~~ the ~~2011 Option Plan.~~remainder of their original ten year term.

Incentive stock options and non-qualified stock options granted under the Option Plans become vested and exercisable at a rate of 20% per year over five years, commencing one year from the date of the grant, with an additional 20% vesting on each successive anniversary of the date the option was granted. No vesting shall occur after an employee’s employment or service as a director is terminated. In the event of death or disability of an employee or director or change in control of the Company, the unvested options shall become vested and exercisable. The Company recognizes compensation expense during the vesting period based on the fair value of the option on the date of the grant.

Stock Incentive ~~Plan~~Plans

On November 12, 2014, the ~~shareholders~~stockholders of the Company approved the adoption of the Company’s 2014 Stock Incentive Plan (the “2014 Stock Incentive Plan”) for the benefit of employees and non-employee directors as an incentive to contribute to the success of the Company and reward employees for outstanding performance and the attainment of targeted goals. The 2014 Stock Incentive Plan covers a total of 300,000 shares (as adjusted), of which no more than 74,000 shares (as adjusted), or 25% of the plan, may be share rewards. The balance of the plan is reserved for stock option awards which would total 225,000 stock options (as adjusted), assuming all the share awards are issued. All incentive stock options granted under the 2014 Stock Incentive Plan are intended to comply with the requirements of Section 422 of the Internal Revenue Code. On ~~October 26, 2015,~~July 21, 2022 and August 15, 2022, the Company granted a total of ~~69,000 plan share awards and 207,000~~8,000 stock options to directors, officers, and other key employees vesting ratably over five years. On February 5, 2019, the Company granted a total of 6,000 plan share awards and 27,000 stock options (which includes 9,000 stock options forfeited from the October 26, 2015 grants) to key employees vesting ratably over five years.

~~Index~~

~~HOME FEDERAL BANCORP, INC. OF LOUISIANA~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)~~

~~6. Stock-Based Compensation (continued)~~

~~Stock Incentive Plan (continued)~~

On November 13, 2019, the ~~shareholders~~stockholders of the Company approved the adoption of the Company’s 2019 Stock Incentive Plan (the “2019 Stock Incentive Plan,” together with the 2014 Stock Incentive Plan, the “Stock Incentive Plans”) which provides for a total of 250,000 shares (as adjusted) reserved for future issuance as stock awards or stock options. No more than 62,500 shares (as adjusted), or 25%, may be granted as stock awards. The balance of the plan is reserved for stock option awards. On November 11, 2020, the Company granted a total of 62,500 plan share awards and 187,500 stock options to directors, officers and other key employees vesting ratably over five years. The Stock Incentive Plans costs are recognized over the five year vesting period. As of September 30, ~~2021,~~2022, there are 0 1,200 plan share awards ~~or stock~~and 10,000 stock options available for future grants under the Stock Incentive Plans.

~~Compensation expense pertaining to the 2011 Recognition Plan and the share awards under the Stock Incentive Plans was 0 and $106,000 for~~For both the three months ended September 30, ~~2021~~2022 and ~~2020, respectively. For the three months ended September 30,~~ 2021, ~~and 2020,~~ compensation expense charged to operations for stock options granted under the 2011 Option Plan and the Stock Incentive Plans was ~~$26,000 and $34,000, respectively.~~$26,000.

7. Related Party Transactions

Certain directors and executive officers were indebted to the Bank in the approximate aggregate ~~amounts~~amount of ~~$3.1 million and $3.4~~$4.2 million at both September 30, ~~2021~~2022 and June 30, ~~2021, respectively.~~2022.

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

8. Fair Value Disclosures

The following disclosure is made in accordance with the requirements of ASC 825, Financial Instruments. Financial instruments are defined as cash and contractual rights and obligations that require settlement, directly or indirectly, in cash. In cases where quoted market prices are not available, fair values have been estimated using the present value of future cash flows or other valuation techniques. The results of these techniques are highly sensitive to the assumptions used, such as those concerning appropriate discount rates and estimates of future cash flows, which require considerable judgment. Accordingly, estimates presented herein are not necessarily indicative of the amounts the Company could realize in a current settlement of the underlying financial instruments.

ASC 825 excludes certain financial instruments and all nonfinancial instruments from its disclosure requirements. These disclosures should not be interpreted as representing an aggregate measure of the underlying value of the Company.

The following methods and assumptions were used by the Company in estimating fair values of financial instruments:

Cash and Cash Equivalents

The carrying amount approximates the fair value of cash and cash equivalents.

Investment Securities

Fair values for investment securities, including mortgage-backed securities, are based on quoted market prices, where available. If quoted market prices are not available, fair values are based on quoted market prices of comparable instruments. The carrying values of restricted or non-marketable equity securities approximate their fair values. The carrying amount of accrued investment income approximates its fair value.

Mortgage Loans Held-for-Sale

Because these loans are normally disposed of within ninety days of origination, their carrying value closely approximates the fair value of such loans.

~~Index~~

~~HOME FEDERAL BANCORP, INC. OF LOUISIANA~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)~~

~~8. Fair Value Disclosures (continued)~~

Loans Receivable

For variable-rate loans that re-price frequently and with no significant changes in credit risk, fair value approximates the carrying value. Fair values for other loans are estimated using the discounted value of expected future cash flows. Interest rates used are those being offered currently for loans with similar terms to borrowers of similar credit quality. The carrying amount of accrued interest receivable approximates its fair value.

Deposit Liabilities

The fair values for demand deposit accounts are, by definition, equal to the amount payable on demand at the reporting date, that is, their carrying amounts. Fair values for other deposit accounts are estimated using the discounted value of expected future cash flows. The discount rate is estimated using the rates currently offered for deposits of similar maturities.

Advances from Federal Home Loan Bank

The carrying amount of short-term borrowings approximates their fair value. The fair value of long-term debt is estimated using discounted cash flow analyses based on current incremental borrowing rates for similar borrowing arrangements.

Off-Balance Sheet Credit-Related Instruments

Fair values for outstanding mortgage loan commitments to lend are based on fees currently charged to enter into similar agreements, taking into account the remaining term of the agreements, customer credit quality, and changes in lending rates.

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

8. Fair Value Disclosures (continued)

The fair value of interest rate floors and caps contained in some loan servicing agreements and variable rate mortgage loan contracts are considered immaterial within the context of fair value disclosure requirements. Accordingly, no fair value estimate is provided for these instruments.

At September 30, ~~2021~~2022 and June 30, ~~2021,~~2022, the carrying amount and estimated fair values of the Company’s financial instruments were as follows:

	September 30, 2021				June 30, 2021				September 30, 2022				June 30, 2022
	Carrying		Estimated		Carrying		Estimated		Carrying		Estimated		Carrying		Estimated
	Value		Fair Value		Value		Fair Value		Value		Fair Value		Value		Fair Value
	(In Thousands)								(In Thousands)
Financial Assets
Cash and Cash Equivalents	$	101,256	$	101,256	$	104,405	$	104,405	$	37,531	$	37,531	$	64,078	$	64,078
Securities Available-for-Sale		26,974		26,974		29,550		29,550		30,765		30,765		28,099		28,099
Securities to be Held-to-Maturity		61,969		61,775		54,706		54,608		78,073		63,988		79,950		69,513
Loans Held-for-Sale		10,573		10,573		14,427		14,427		1,988		1,988		3,978		3,978
Loans Receivable		339,424		340,330		336,394		336,865		406,373		374,712		387,873		369,728

Financial Liabilities
Deposits	$	507,583	$	496,289	$	506,596	$	492,492	$	523,760	$	436,459	$	531,991	$	490,789
Advances from FHLB		859		907		867		924		823		827		832		844

Off-Balance Sheet Items
Mortgage Loan Commitments	$	9,886	$	9,886	$	9,677	$	9,677	$	13,618	$	13,618	$	11,365	$	11,365

The estimated fair values presented above could be materially different than net realizable value and are only indicative of the individual financial instrument’s fair value. Accordingly, these estimates should not be considered an indication of the fair value of the Company taken as a whole.

~~Index~~

~~HOME FEDERAL BANCORP, INC. OF LOUISIANA~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)~~

~~8. Fair Value Disclosures (continued)~~

The Company follows the guidance of FASB ASC Topic 820, Fair Value Measurements and Disclosures ("(“ASC ~~820"~~820”). ASC 820 affirms a framework for measuring fair value and expands disclosures about fair value measurements. ASC 820 was issued to establish a uniform definition of fair value. The definition of fair value is market-based as opposed to company-specific and includes the following:

Defines fair value as the price that would be received to sell an asset or paid to transfer a liability, in either case, through an orderly transaction between market participants at a measurement date and establishes a framework for measuring fair value;

Establishes a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date;

Nullifies the guidance in EITF 02-3, which required the deferral of profit at inception of a transaction involving a derivative financial instrument in the absence of observable data supporting the valuation technique;

Eliminates large position discounts for financial instruments quoted in active markets and requires consideration of the company’s creditworthiness when valuing liabilities; and

Expands disclosures about instruments that are measured at fair value.

The standard establishes a three-level valuation hierarchy for disclosure of fair value measurements. The valuation hierarchy favors the transparency of inputs to the valuation of an asset or liability as of the measurement date. The three levels are defined as follows:

Level 1 – Fair value is based upon quoted prices (unadjusted) for identical assets or liabilities in active markets in which the Company can participate.

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

8. Fair Value Disclosures (continued)

•

Level 2 – Fair value is based upon (a) quoted prices for similar assets or liabilities in active markets; (b) quoted prices for identical or similar assets or liabilities in markets that are not active, that is, markets in which there are few transactions for the asset or liability, the prices are not current, or price quotations vary substantially either over time or among market makers, or in which little information is released publicly; (c) inputs other than quoted prices that are observable for the asset or liability; or (d) inputs that are derived principally from or corroborated by observable market data by correlation or other means.

•

Level 3 – Fair value is based upon inputs that are unobservable for the asset or liability. These inputs reflect the Company’s own assumptions about the assumptions that market participants would use in pricing the asset or liability (including assumptions about risk). These inputs are developed based on the best information available in the circumstances, which include the Company’s own data. The Company’s own data used to develop unobservable inputs are adjusted if information indicates that market participants would use different assumptions.

A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

The preceding methods described may produce a fair value calculation that may not be indicative of the net realizable value or reflective of future fair values. Furthermore, although the Company believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date. There have been no changes in the methodologies used during the three months ended September 30, ~~2021.~~

~~Index~~

~~HOME FEDERAL BANCORP, INC. OF LOUISIANA~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)~~

~~8. Fair Value Disclosures (continued)~~2022.

Fair values of assets and liabilities measured on a recurring basis at September 30, ~~2021~~2022 and June 30, ~~2021~~2022 are as follows: ~~see table~~

	Fair Value Measurements Using:												Fair Value Measurements
September 30, 2021	Quoted Prices in Active Markets for Identical Assets (Level 1)			Significant Other Observable Inputs (Level 2)			Unobservable Inputs (Level 3)			Total
September 30, 2022													(Level 1)			(Level 2)			(Level 3)			Total
	(In Thousands)												(In Thousands)
Available-for-Sale
Debt Securities
FHLMC		$	0		$	3,785		$	0		$	3,785		$	-		$	11,157		$	-		$	11,157
FNMA			0			17,303			0			17,303			-			15,084			-			15,084
GNMA			0			5,886			0			5,886			-			3,979			-			3,979
															-			30,220			-			30,220

Municipals															-			545			-			545

Total		$	0		$	26,974		$	0		$	26,974		$	-		$	30,765		$	-		$	30,765

	Fair Value Measurements Using:												Fair Value Measurements
June 30, 2021	Quoted Prices in Active Markets for Identical Assets (Level 1)			Significant Other Observable Inputs (Level 2)			Unobservable Inputs (Level 3)			Total
June 30, 2022													(Level 1)			(Level 2)			(Level 3)			Total
				(In Thousands)												(In Thousands)
Available-for-Sale
Debt Securities
FHLMC		$	0		$	4,221		$	0		$	4,221		$	-		$	7,032		$	-		$	4,221
FNMA			0			19,152			0			19,152			-			16,686			-			19,152
GNMA			0			6,177			0			6,177			-			4,381			-			6,177

Total		$	0		$	29,550		$	0		$	29,550		$	-		$	28,099		$	-		$	29,550

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

9. Leases

A lease is defined as a contract, or part of a contract, that conveys the right to control the use of identified property, plant or equipment for a period of time in exchange for consideration. On July 1, 2019, the Company adopted ASU No. 2016-02 “Leases” (Topic 842) and all subsequent ASUs that modified Topic 842. For the Company, Topic 842 primarily affected the accounting treatment for operating lease agreements in which the Company is the lessee. Substantially all of the leases in which the Company is the lessee are comprised of real estate property for branches with terms extending through 2058. Substantially all of the Company’s leases are classified as operating leases, and therefore, were previously not recognized on the Company’s consolidated statements of condition. With the adoption of Topic 842, operating lease agreements are required to be recognized on the consolidated statements of condition as right-of-use (“ROU”) assets and corresponding lease liabilities. See table

(In Thousands)		September 30, 2021		June 30, 2021			September 30, 2022		June 30, 2022
Lease Right-of-Use Assets	Classification					Classification
Operating lease right-of-use assets	Other Assets	$	855	$	858	Other Assets	$	840	$	844
Total Lease Right-of-Use Assets		$	855	$	858		$	840	$	844

Lease Liabilities
Operating lease liabilities	Other Accrued Expenses and Liabilities	$	875	$	876	Other Accrued Expenses and Liabilities	$	870	$	871
Total Lease Liabilities		$	875	$	876		$	870	$	871

~~Index~~

~~HOME FEDERAL BANCORP, INC. OF LOUISIANA~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)~~

9.~~Leases (continued)~~

The calculated amount of the ROU assets and lease liabilities in the table above are impacted by the length of the lease term and the discount rate used to present value the minimum lease payments. The Company’s lease agreements often include one or more options to renew at the Company’s discretion. If at lease inception, the Company considers the exercising of a renewal option to be reasonably certain, the Company will include the extended term in the calculation of the ROU asset and lease liability. Regarding the discount rate, Topic 842 requires the use of the rate implicit in the lease whenever this rate is readily determinable. As this rate is rarely determinable, the Company utilizes its incremental borrowing rate at lease inception, on a collateralized basis, over a similar term. For operating leases existing prior to July 1, 2019, the rate for the remaining lease term as of July 1, 2019, was the Company’s only finance lease, the Company utilized its incremental borrowing rate at lease inception.

	September 30, 2021			June 30, 2021			September 30, 2022			June 30, 2022
Weighted-average remaining lease term
Operating leases	37.1 years			37.4 years			36.1 years			36.4 years

Weighted-average discount rate
Operating leases		3.00	%		3.00	%		3.00	%		3.00	%

10. Subsequent Events

~~There have been no subsequent events that have occurred after September 30, 2021, through~~On October 4, 2022, the ~~date~~Company announced the signing of a definitive Agreement and Plan of Merger (“Merger Agreement”) pursuant to which the Company will acquire Northwest Bancshares Corporation (“Northwest Bancshares”), the holding company of the First National Bank of Benton (“FNB Benton”) in an all cash acquisition. Under the terms of the Merger Agreement, stockholders of Northwest Bancshares will receive their pro rata portion of aggregate merger consideration equal to $4.25 million, plus the sum of 8.0% of total assets of Northwest Bancshares as of the month-end immediately prior to the closing of the merger after giving effect to a special distribution (the “Special Distribution”) to be paid, less the amount, if any, that Northwest Bancshares’ total unaccrued and unpaid transaction expenses exceed $125,000. Based on financial ~~statements,~~data as of August 31, 2022, the Company currently estimates that ~~would require disclosure or have~~the aggregate merger consideration will be approximately $10.1 million. In addition to the merger consideration, the Merger Agreement provides that, prior to consummation of the merger, Northwest Bancshares will pay the Special Distribution in cash to its stockholders in an ~~adverse impact~~aggregate amount which will reduce the ratio of Northwest Bancshares’ total stockholders’ equity to total consolidated assets to 8.0%. Based on financial data at August 31, 2022, the ~~financial statement.~~Company estimates that the amount of Special Distribution will be approximately $8.4 million. The Merger Agreement provides that FNB Benton’s loan loss reserve shall be no less than 1.3% of total loans as of the month-end preceding the closing of the merger. Based on current estimates, the Bank expects that it will continue to exceed its regulatory capital requirements following consummation of the transaction.

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

ITEM 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

General

The Company’s results of operations are primarily dependent on the results of Home Federal Bank (the “Bank”), its wholly owned subsidiary. The Bank’s results of operations depend, to a large extent, on net interest income, which is the difference between the income earned on its loan and investment portfolios and the cost of funds, consisting of the interest paid on deposits and borrowings. Results of operations are also affected by provisions for loan losses and loan sale activities. Non-interest expense principally consists of compensation and employee benefits, office occupancy and equipment expense, data processing, and other expenses. Our results of operations are also significantly affected by general economic and competitive conditions, particularly changes in interest rates, government policies, and actions of regulatory authorities. Future changes in applicable law, regulations, or government policies may materially impact our financial ~~conditions~~condition and results of operations.

The Bank operates from its main office in Shreveport, Louisiana and ~~seven~~nine full service branch offices located in Shreveport, ~~and~~ Bossier City and Minden, Louisiana. The Company’s primary market area is the Shreveport-Bossier ~~City metropolitan~~City-Minden combined statistical area.

Critical Accounting Policies

Allowance for Loan Losses. The Company has identified the calculation of the allowance for loan losses as a critical accounting policy, due to the higher degree of judgment and complexity than its other significant accounting policies. Provisions for loan losses are based upon management’s periodic valuation and assessment of the overall loan portfolio and the underlying collateral, trends in non-performing loans, current economic conditions, and other relevant factors in order to maintain the allowance for loan losses at a level believed by management to represent all known and inherent losses in the portfolio that are both probable and reasonably estimable. Although management uses the best information available, the level of the allowance for loan losses remains an estimate which is subject to significant judgment and short-term change.

Income Taxes. Deferred income tax assets and liabilities are determined using the liability (or balance sheet) method. Under this method, the net deferred tax asset or liability is determined based on the tax effects of the temporary differences between the book and tax basis of the various assets and liabilities and gives current recognition to changes in tax rates and laws. The realization of our deferred tax assets principally depends upon our achieving projected future taxable income. We may change our judgments regarding future profitability due to future market conditions and other factors. We may adjust our deferred tax asset balances, if our judgments change.

Discussion of Financial Condition Changes from June 30, ~~2021~~2022 to September 30, ~~2021~~2022

General

At September 30, ~~2021,~~2022, the Company reported total assets of ~~$566.8~~$581.6 million, ~~an increase~~a decrease of ~~$1.1~~$8.9 million, or ~~0.2%~~1.5%, compared to total assets of ~~$565.7~~$590.5 million at June 30, ~~2021.~~2022. The ~~increase~~decrease in assets was comprised primarily of increases in investment securities of $4.7 million, or 5.6%, from $84.3 million at June 30, 2021 to $88.9 million at September 30, 2021, loans receivable, net of $3.0 million, or 0.9%, from $336.4 million at June 30, 2021 to $339.4 million at September 30, 2021, and premises and equipment of $896,000, or 6.0%, from $14.9 million at June 30, 2021 to $15.8 million at September 30, 2021. These increases were partially offset by decreases in ~~loans held-for-sale of $3.9, or 26.7%, from $14.4 million at June 30, 2021 to $10.6 million at September 30, 2021,~~ cash and cash equivalents of ~~$3.1~~$26.5 million, or ~~3.0%~~41.4%, from ~~$104.4~~$64.1 million at June 30, ~~2021~~2022 to ~~$101.3~~$37.5 million at September 30, ~~2021, deferred tax assets~~2022, loans held for sale of ~~$265,000,~~$2.0 million, or ~~32.4%~~50.0%, from ~~$819,000 at June 30, 2021 to $554,000 at September 30, 2021, other assets of $170,000, or 9.7%, from $1.8~~$4.0 million at June 30, ~~2021~~2022 to ~~$1.6~~$2.0 million at September 30, ~~2021,~~2022, premises and equipment of $112,000, or 0.7%, from $16.2 million at June 30, 2022 to $16.1 million at September 30, 2022, and other assets of $103,000, or 7.4%, from $1.4 million at June 30, 2022 to $1.3 million at September 30, 2022. These decreases were partially offset by increases in loans receivable, net of $18.5 million, or 4.8%, from $387.9 million at June 30, 2022 to $406.4 million at September 30, 2022, investment securities of $789,000, or 0.7%, from $108.0 million at June 30, 2022 to $108.8 million at September 30, 2022, deferred tax asset of $323,000, or 28.3%, from $1.1 million at June 30, 2022 to $1.5 million at September 30, 2022, accrued interest receivable of ~~$119,000,~~$126,000, or ~~10.2%~~11.2%, from ~~$1.2~~$1.1 million at June 30, ~~2021~~2022 to ~~$1.0~~$1.3 million at September 30, ~~2021.~~2022, real estate owned of $93,000, or 100.0%, from none at June 30, 2022 to $93,000 at September 30, 2022, and bank owned life insurance of $26,000, or 0.4%, from $6.60 million at June 30, 2022 to $6.62 million at September 30, 2022. The decrease in cash and cash equivalents was primarily due to the funding of additional loan growth and purchases of securities with excess liquidity. The increase in loans receivable, net, was primarily due to an increase of $13.9 million in commercial real estate loans. The increase in investment securities was primarily due to security purchases of ~~$9.9~~$5.4 million offset by principal repayments on mortgage backed securities of ~~$5.2 million.~~$3.4 million and a $1.1 million increase in market value losses on available-for-sale securities. The decrease in loans held-for-sale primarily reflected a reduction in loans originated for sale during the three months ended September 30, 2022 due mainly to a decrease in mortgage refinance activity likely attributable to the increase in interest rates.

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

Discussion of Financial Condition Changes from June 30, ~~2021~~2022 to September 30, ~~2021~~2022 (continued)

Cash and Cash Equivalents

Cash and cash equivalents decreased ~~$3.1~~$26.5 million, or ~~3.0%~~41.4%, from ~~$104.4~~$64.1 million at June 30, ~~2021~~2022 to ~~$101.3~~$37.5 million at September 30, ~~2021.~~2022. The decrease in cash and cash equivalents was primarily due to ~~the purchases of investment securities.~~commercial loan originations.

Loans Receivable, Net

Loans receivable, net, ~~decreased~~increased by ~~$3.0~~$18.5 million, or ~~0.9%~~4.8%, to ~~$339.4~~$406.4 million at September 30, ~~2021~~2022 compared to ~~$336.4~~$387.9 million at June 30, ~~2021.~~2022. The ~~decrease~~increase in loans receivable, net was primarily due to ~~decreases~~increases in commercial ~~non-real~~real estate loans of ~~$15.7~~$13.9 million, one-to-four-family residential loans of $6.5 million, equity line-of-credit loans of $1.1 million, land loans of ~~$1.9 million, multi-family residential loans of $606,000, equity line-of-credit loans of $352,000,~~$625,000, equity and second mortgage loans of ~~$35,000,~~$43,000, and consumer loans of ~~$30,000,~~$1,000, partially offset by ~~increases~~decreases in ~~one-to-four-family~~multi-family residential loans of ~~$11.2~~$1.8 million, construction loans of $971,000, and commercial ~~real~~non-real estate loans of ~~$9.9 million, and construction loans of $215,000.~~$619,000.

Loans Held-for-Sale

Loans held-for-sale decreased ~~$3.9~~$2.0 million, or ~~26.7%~~50.0%, from ~~$14.4~~$4.0 million at June 30, ~~2021~~2022 to ~~$10.6~~$2.0 million at September 30, ~~2021.~~2022. The decrease in loans held-for-sale results primarily from the decrease in the origination volume during the first three months of fiscal ~~2022.~~year end 2023.

Investment Securities

Investment securities amounted to ~~$88.9~~$108.8 million at September 30, ~~2021~~2022 compared to ~~$84.3~~$108.0 million at June 30, ~~2021,~~2022, an increase of ~~$4.7 million,~~$789,000, or ~~5.6%~~0.7%. The increase in investment securities was primarily due to security purchases of ~~$9.9~~$5.4 million offset by principal repayments on mortgage backed securities of ~~$5.2 million.~~$3.4 million and a $1.1 million increase in market value losses on available-for-sale securities.

Premises and Equipment, Net

Premises and equipment, net ~~increased $896,000,~~decreased $112,000, or ~~6.0%~~0.7%, to ~~$15.8~~$16.1 million at September 30, ~~2021~~2022 compared to ~~$14.9~~$16.2 million at June 30, ~~2021.~~2022. The ~~increase~~decrease in premises and equipment was primarily due to depreciation expense for the ~~construction of the Company’s new Huntington branch on Pines Road.~~three month period.

Asset Quality

At ~~both~~ September 30, ~~2021 and June 30, 2021,~~2022, the Company had ~~$1.4~~$2.2 million of non-performing assets (defined as non-accruing loans, accruing loans 90 days or more past due, and other real estate owned), compared to $2.2 million of non-performing assets at June 30, 2022, consisting of six ~~commercial real estate loans to one borrower, two~~ single-family residential loans ~~and one commercial real estate property~~ and one single family residence in other real estate owned at September 30, ~~2021,~~2022, compared to six ~~commercial real estate loans to one borrower, three~~ single-family residential loans and one ~~commercial real estate property and one single family residence in other real estate owned~~line of credit loan at June 30, ~~2021.~~2022. At both September 30, ~~2021,~~2022 and June 30, 2022, the Company had ~~one~~five single family residential ~~loan~~loans and ~~eight~~two commercial real estate loans classified as ~~substandard compared to two single family residential loans and eightcommercial real estate loans classified as substandard at June 30, 2021.~~substandard. There were no loans classified as doubtful at September 30, ~~2021~~2022 or June 30, ~~2021.~~2022.

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

Discussion of Financial Condition Changes from June 30, ~~2021~~2022 to September 30, ~~2021~~2022 (continued)

Total Liabilities

Total liabilities ~~increased $125,000,~~decreased $3.7 million, or ~~0.02%~~0.7%, from ~~$513.0~~$538.1 million at June 30, ~~2021~~2022 to ~~$513.1~~$534.5 million at September 30, ~~2021~~2022 primarily due to ~~increases~~decreases in total deposits of ~~$987,000,~~$8.2 million, or ~~0.2%~~1.5%, to ~~$507.6~~$523.8 million at September 30, ~~2021~~2022 compared to ~~$506.6~~$532.0 million at June 30, ~~2021,~~2022, and $345,000, or 12.7%, in other liabilities from $2.7 million at June 30, 2021 to $3.1 million at September 30, 2021, partially offset by a decrease of $1.3 million, or 54.2%, in other borrowings from $2.4 million at June 30, 2021 to $1.1 million at September 30, 2021, and a decrease of $8,000, or 0.9%, inshort-term advances from the Federal Home Loan Bank ~~from $867,000~~of $9,000, or 1.1%, to $823,000 at September 30, 2022 compared to $832,000 at June 30, ~~2021~~2022, partially offset by increases in other borrowings of $4.0 million, or 170.2%, to ~~$859,000~~$6.4 million at September 30, ~~2021.~~2022 compared to $2.4 million at June 30, 2022, other accrued expenses and liabilities of $431,000, or 16.5%, to $3.0 million at September 30, 2022 compared to $2.6 million at June 30, 2022, and advances from borrowers for taxes and insurance of $136,000, or 38.4%, to $490,000 at September 30, 2022 compared to $354,000 at June 30, 2022. The ~~increase~~decrease in deposits was primarily due to a ~~$14.2~~$13.1 million, or ~~10.8%~~9.8%, ~~increase~~decrease in savings deposits from $133.0 million at June 30, 2022 to $119.9 million at September 30, 2022, a $6.4 million, or 4.0%, decrease in non-interest bearing deposits from ~~$131.0~~$161.1 million at June 30, ~~2021~~2022 to ~~$145.2~~$154.7 million at September 30, ~~2021, and~~2022, a ~~$5.6~~$2.2 million, or 4.3%, increase in savings deposits from $129.1 million at June 30, 2021 to $134.7 million at September 30, 2021, partially offset by a decrease of $14.2 million, or 13.0%, in certificates of deposit from $109.0 million at June 30, 2021 to $94.8 million at September 30, 2021, a $3.1 million, or 3.5%2.2%, decrease in money market deposits from ~~$88.2~~$98.6 million at June 30, ~~2021~~2022 to ~~$85.1~~$96.5 million at September 30, ~~2021, and a decrease in NOW accounts~~2022, partially offset by an increase of ~~$1.6~~$7.8 million, or ~~3.2%~~9.8%, in certificates of deposit from ~~$49.3~~$80.3 million at June 30, ~~2021~~2022 to ~~$47.7~~$88.1 million at September 30, ~~2021.~~2022, and an increase of $5.6 million, or 9.4% in NOW accounts from $59.0 million at June 30, 2022 compared to $64.5 million at September 30, 2022. The Company had ~~$9.1~~$3.0 million in brokered deposits at September 30, ~~2021~~2022 compared to ~~$10.7~~$6.0 million at June 30, ~~2021.~~2022. The decrease in short-term advances from the Federal Home Loan Bank was primarily due to principal paydowns on amortizing advances. The entire balance in advances from the Federal Home Loan Bank are now short-term due to our only advance with a balloon maturity in January 2023.

~~Shareholders’~~Stockholders’ Equity

~~Shareholders’~~Stockholders’ equity ~~increased $959,000,~~decreased $5.2 million, or ~~1.8%~~10.0%, to ~~$53.7~~$47.1 million at September 30, ~~2021~~2022 from ~~$52.7~~$52.3 million at June 30, ~~2021.~~2022. The primary reasons for the changes in ~~shareholders’~~stockholders’ equity from June 30, ~~2021~~2022 were the repurchase of Company stock of $5.9 million, a decrease in the Company’s accumulated other comprehensive income (loss) of $878,000, and dividends paid totaling $407,000, partially offset by net income of ~~$1.4~~$1.7 million, ~~the vesting of share awards, stock options, and the release of employee stock ownership plan shares totaling $168,000, and~~ proceeds from the issuance of common stock from the exercise of stock options of ~~$166,000, partially offset by~~$147,000, and the vesting of restricted stock awards, stock options, and the release of employee stock ownership plan shares totaling $137,000.

The Company repurchased 289,900 shares of its common stock during the three months ended September 30, 2022 at an average price per share of $20.00. On February 16, 2022, the Company announced that its Board of Directors approved an eleventh stock repurchase program for the repurchase of ~~Company~~up to 170,000 shares. The eleventh stock ~~of $334,000, dividends paid totaling $335,000, and a decrease in the Company’s accumulated other comprehensive income of $27,000.~~repurchase program was completed on August 2, 2022.

Regulatory Capital

The Bank is required to meet minimum capital standards promulgated by the Office of the Comptroller of the Currency (“OCC”). At September 30, ~~2021,~~2022, Home Federal Bank’s regulatory capital was well in excess of the minimum capital requirements. At September 30, ~~2021,~~2022, Home Federal Bank exceeded each of its regulatory capital requirements with tangible equity, common equity Tier 1, core, and total risk-based capital ratios of ~~9.57%~~9.50%, ~~15.97%~~13.85%, ~~9.57%~~9.50%, and ~~17.19%~~15.06%, respectively.

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

Comparison of Operating Results for the Three Months Ended September 30, ~~2021~~2022 and ~~2020~~2021

General

The increase in net income for the three months ended September 30, ~~2021,~~2022, as compared to the prior year quarter resulted primarily from an increase of $1.1 million, or 25.6%, in net interest income, and a ~~$700,000,~~decrease of $343,000, or 97.4%, in provision for income taxes, partially offset by a decrease of $470,000, or 46.3%, in non-interest income, an increase of $418,000, or 100.0%, ~~decrease~~ in provision for loan losses, and an increase of ~~$237,000,~~$218,000, or ~~5.9%~~6.2%, in non-interest expense. The increase in net interest income ~~partially offset by~~for the three months ended September 30, 2022 was due to a $1.0 million, or 21.1%, increase in total interest income, and a $74,000, or 13.5%, decrease ~~of $690,000, or 40.4%,~~ in ~~non-interest~~total interest expense. The increase in total interest income was primarily due to an increase of ~~$112,000, or 3.3%,~~68 basis points in ~~non-interest expense, and a $29,000, or 9.0%, increase in provision~~the average rate on total interest-earning assets. The Company’s average interest rate spread was 3.74% for ~~income taxes.~~the three months ended September 30, 2022 compared to 2.98% for the three months ended September 30, 2021. The Company’s net interest margin was 3.90% for the three months ended September 30, 2022 compared to 3.16% for the three months ended September 30, 2021. The decrease in provision for ~~loan losses is mainly~~income taxes was due to ~~improved economic quality factors along with~~ an ~~improvement~~adjustment in ~~our overall credit quality.~~

~~Index~~

~~HOME FEDERAL BANCORP, INC. OF LOUISIANA~~

~~Comparison of Operating Results~~taxes due for ~~the Three Months Ended September~~fiscal year ended June 30, ~~2021 and 2020 (continued)~~2022 related to stock option exercises.

Net Interest Income

The increase in net interest income for the three months ended September 30, ~~2021~~2022 was ~~primarily~~ due to a ~~$447,000,~~$1.0 million, or ~~44.8%~~21.1%, increase in total interest income, and a $74,000, or 13.5%, decrease in total interest ~~expense, partially offset by a $210,000, or 4.2%, decrease~~expense. The increase in total interest ~~income. The decrease in total interest expense~~income was primarily due to ~~a decrease~~an increase of 5068 basis points in the average rate on total ~~interest-bearing deposits.~~interest-earning assets. The Company’s average interest rate spread was 3.74% for the three months ended September 30, 2022 compared to 2.98% for the three months ended September 30, ~~2021 compared to 2.92%~~2021. The Company’s net interest margin was 3.90% for the three months ended September 30, ~~2020. The Company’s net interest margin was~~2022 compared to 3.16% for the three months ended September 30, ~~2021 compared to 3.21% for the three months ended September 30, 2020.~~2021.

Provision for Loan Losses ~~on Loans~~

Based on an analysis of historical experience, the volume and type of lending conducted by ~~Home Federal~~the Bank, the status of past due principal and interest payments, general economic conditions, particularly as such conditions relate to our market area, and other factors related to the collectability of Home Federal Bank’s loan portfolio, the provision for loan losses was ~~none~~$418,000 during the three months ended September 30, ~~2021,~~2022, compared to ~~a $700,000 provision~~none made during the three months ended September 30, ~~2020.~~2021. The allowance for loan losses was $4.8 million, or 1.18% of total loans receivable, at September 30, 2022 compared to $4.1 million, or 1.20% of total loans receivable, at September 30, ~~2021 compared to $4.5 million, or 1.26% of total loans receivable, at~~2021. At September 30, ~~2020.~~2022, the Bank had $2.1 in non-performing loans and $93,000 in foreclosed assets which totaled $2.2 million in non-performing assets. At September 30, 2021, Home Federal Bank had $976,000 in non-performing loans and $383,000 in foreclosed assets which totaled $1.4 million in non-performing assets.

Non-interest Income

The ~~$690,000~~$470,000 decrease in non-interest income for the three months ended September 30, ~~2021,~~2022, compared to the prior year quarterly period, was primarily due to a decrease of ~~$702,000~~$534,000 in gain on sale of loans, ~~and~~ a ~~$6,000~~$2,000 decrease in income from bank owned life insurance, and a $1,000 decrease in other income, partially offset by a ~~$20,000~~$67,000 increase in service charges on deposit accounts. The Company sells most of its long-term fixed rate residential mortgage loan originations primarily in order to manage interest rate risk. The decrease in gain on sale of loans was due to a reduction in loans originated for sale reflecting a decrease in mortgage refinancing activity.

Non-interest Expense

The ~~$112,000~~$218,000 increase in non-interest expense for the three months ended September 30, ~~2021,~~2022, compared to the same period in ~~2020,~~2021, is primarily attributable to increases of ~~$53,000~~$93,000 in other non-operating expense, $72,000 in compensation and benefits expense, $72,000 in occupancy and equipment expense, ~~$48,000~~$26,000 in ~~advertising expense, $22,000 in franchise and bank shares tax expense, $19,000 in other non-interest expenses, $13,000 in data processing expense, $8,000~~legal fees, $9,000 in deposit insurance ~~premiums~~ expense, and ~~$6,000~~$3,000 in audit and examination fees. The increases were partially offset by decreases of ~~$31,000~~$26,000 in ~~legal fees, $22,000~~data processing expense, $20,000 in loan and collection expense, and ~~$4,000~~$11,000 in ~~compensation~~franchise and ~~benefits~~bank shares tax expense. The decrease in other non-operating expense was primarily due to communication expense, correspondent bank fees, and fraud expense related to deposit checking accounts.

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

Comparison of Operating Results for the Three Months Ended September 30, 2022 and 2021 (continued)

The aggregate compensation expense recognized by the Company for its Stock ~~Option,~~Options, Share ~~Award, ESOP,~~Awards and ~~Recognition and Retention Plans~~employee stock ownership plan, amounted to $168,000 ~~and $140,000~~ for both the three months ended September 30, ~~2021~~2022 and September 30, ~~2020, respectively.~~2021.

The Louisiana bank shares tax is assessed on the Bank’s equity and earnings. For the three months ended September 30, ~~2021,~~2022, the Company recognized franchise and bank shares tax expense of ~~$130,000~~$119,000 compared to ~~$108,000,~~$130,000, for the same period in ~~2020.~~2021.

Income Taxes

Income taxes amounted to $9,000 for the three months ended September 30, 2022, resulting in an effective tax rate of 0.5%. Income taxes amounted to $352,000 for the three months ended September 30, 2021, ~~respectively,~~ resulting in an effective tax rate of 20.6%. ~~Income~~The decrease in provision for income taxes ~~amounted~~was due to ~~$323,000 for the three months ended September 30, 2020, resulting~~an adjustment in ~~an effective tax rate of 18.3%.~~taxes related to stock option exercises.

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

Comparison of Operating Results for the Three Months Ended September 30, ~~2021~~2022 and ~~2020~~2021 (continued)

Average Balances, Net Interest Income, Yields Earned, and Rates Paid. The following tables show for the periods indicated the total dollar amount of interest from average interest-earning assets and the resulting yields, as well as the interest expense on average interest-bearing liabilities, expressed both in dollars and rates, and the net interest margin. Tax-exempt income and yields have not been adjusted to a tax-equivalent basis. All average balances are based on monthly balances. Management does not believe that the monthly averages differ significantly from what the daily averages would be.

	Three Months Ended September 30,
	2022							2021
	Average Balance		Interest		Average Yield/ Rate			Average Balance		Interest		Average Yield/ Rate
	(Dollars In Thousands)
Interest-earning assets:
Loans receivable	$	396,768	$	5,028		5.03	%	$	342,942	$	4,397		5.09	%
Investment securities		110,602		491		1.76			86,350		341		1.57
Interest-earning deposits		32,706		262		3.18			101,732		36		0.14
Total interest-earning assets		540,076		5,781		4.25	%		531,024		4,774		3.57	%
Non-interest-earning assets		45,074							36,089
Total assets	$	585,150						$	567,113
Interest-bearing liabilities:
Savings accounts	$	128,749		84		0.26	%	$	133,140		108		0.32	%
NOW accounts		58,658		17		0.11			48,389		14		0.11
Money market accounts		94,694		35		0.15			86,991		25		0.12
Certificate accounts		84,715		264		1.24			101,364		382		1.50
Total interest-bearing deposits		366,816		400		0.43			369,884		529		0.57
Other Borrowings		4,915		66		5.33			1,376		11		3.17
FHLB advances		826		10		4.80			861		10		4.61
Total interest-bearing liabilities	$	372,557		476		0.51	%	$	372,121		550		0.59	%
Non-interest-bearing liabilities:
Non-interest-bearing demand accounts		161,907							139,885
Other liabilities		3,294							2,938
Total liabilities		537,758							514,944
Total Stockholders’ Equity(1)		47,392							52,169

Total liabilities and stockholders’ equity	$	585,150						$	567,113

Net interest-earning assets	$	167,519						$	158,903

Net interest income; average interest rate spread(2)			$	5,305		3.74	%			$	4,224		2.98	%
Net interest margin(3)						3.90	%						3.16	%
Average interest-earning assets to average interest-bearing liabilities						144.96	%						142.70	%

Three Months Ended September 30,
2021 2020

Average
Balance
Interest
Average
Yield/
Rate

Average
Balance
Interest
Average
Yield/
Rate

(Dollars In Thousands)
Interest-earning assets:
Loans receivable
$
342,942

$
4,397

5.09
%

$
373,311

$
4,647

4.94
%
Investment securities
86,350

341

1.57

58,881

319

2.15

Interest-earning deposits
101,732

36

0.14

60,651

18

0.12

Total interest-earning assets
531,024

4,774

3.57
%

492,843

4,984

4.01
%
Non-interest-earning assets
36,089

35,121

Total assets
$
567,113

$
527,964

Interest-bearing liabilities:
Savings accounts
$
133,140

108

0.32
%

$
90,621

158

0.69
%
NOW accounts
48,389

14

0.11

40,611

32

0.31

Money market accounts
86,991

25

0.12

73,180

75

0.41

Certificate accounts
101,364

382

1.50

156,320

706

1.79

Total interest-bearing deposits
369,884

529

0.57

360,732

971

1.07

Other Borrowings
1,376

11

3.17

1,752

14

3.17

FHLB advances
861

10

4.61

1,010

12

4.71

Total interest-bearing liabilities
$
372,121

550
0.59 %
$
363,494

997
1.09 %
Non-interest-bearing liabilities:
Non-interest-bearing demand accounts
139,885

111,352

Other liabilities
2,938

3,498

Total liabilities
514,944

478,344

Total Stockholders’ Equity(1)
52,169

49,620

Total liabilities and equity
$
567,113

$
527,964

Net interest-earning assets
$
158,903

$
129,349

Net interest income; average interest rate spread(2)
$
4,224

2.98
%

$
3,987

2.92
%
Net interest margin(3)
3.16
%

3.21
%
Average interest-earning assets to average interest-bearing liabilities 142.70 % 135.58 %

(1)	Includes retained earnings and accumulated other comprehensive loss.

(2)	Interest rate spread represents the difference between the weighted-average yield on interest-earning assets and the weighted-average rate on interest-bearing liabilities.

(3)	Net interest margin is net interest income divided by net average interest-earning assets.

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

Comparison of Operating Results for the Three Months Ended September 30, ~~2021~~2022 and ~~2020~~2021 (continued)

Liquidity and Capital Resources

~~Home Federal~~The Bank maintains levels of liquid assets deemed adequate by management. The Bank adjusts its liquidity levels to fund deposit outflows, repay its borrowings, and to fund loan commitments. ~~Home Federal~~The Bank also adjusts liquidity as appropriate to meet asset and liability management objectives.

~~Home Federal~~The Bank’s primary sources of funds are deposits, amortization and prepayment of loans and mortgage-backed securities, maturities of investment securities and other short-term investments, loan sales, and earnings and funds provided from operations. While scheduled principal repayments on loans and mortgage-backed securities are a relatively predictable source of funds, deposit flows and loan prepayments are greatly influenced by general interest rates, economic conditions, and competition. The Bank sets the interest rates on its deposits to maintain a desired level of total deposits. In addition, ~~Home Federal~~the Bank invests excess funds in short-term interest-earning accounts and other assets which provide liquidity to meet lending requirements. ~~Home Federal~~The Bank’s deposit accounts with the Federal Home Loan Bank of Dallas amounted to ~~$34.5~~$6.4 million at September 30, ~~2021.~~2022.

A significant portion of ~~Home Federal~~the Bank’s liquidity consists of securities classified as available-for-sale and cash and cash equivalents. ~~Home Federal~~The Bank’s primary sources of cash are net income, principal repayments on loans and mortgage-backed securities, and increases in deposit accounts. If ~~Home Federal~~the Bank requires funds beyond its ability to generate them internally, borrowing agreements exist with the Federal Home Loan Bank of Dallas which provides an additional source of funds. At September 30, ~~2021, Home Federal~~2022, The Bank had ~~$859,000~~$823,000 in advances from the Federal Home Loan Bank of Dallas and had ~~$178.9~~$159.4 million in additional borrowing capacity. Additionally, at September 30, ~~2021, Home Federal~~2022, the Bank was a party to a Master Purchase Agreement with First National Bankers Bank whereby Home Federal Bank may purchase Federal Funds from First National Bankers Bank in an amount not to exceed $20.4 million. There were no amounts purchased under this agreement as of September 30, ~~2021.~~2022. In addition, the Company had available a ~~$5.0~~$10.0 million line of credit agreement at September 30, ~~2021~~2022 with First National Bankers Bank. At September 30, ~~2021~~2022, there was a ~~$1.5~~$6.4 million balance in the credit line.

At September 30, ~~2021, Home Federal~~2022, the Bank had outstanding loan commitments of ~~$53.0~~$58.9 million to originate loans and commitments under unused lines of credit of ~~$9.9~~$13.6 million. At September 30, ~~2021,~~2022, certificates of deposit scheduled to mature in less than one year totaled ~~$73.8~~$59.2 million. Based on prior experience, management believes that a significant portion of such deposits will remain with us, although there can be no assurance that this will be the case. In addition, the cost of such deposits could be significantly higher upon renewal in a rising interest rate environment. ~~Home Federal~~The Bank intends to utilize its high levels of liquidity to fund its lending activities. If additional funds are required to fund lending activities, Home Federal Bank intends to sell its securities classified as available-for-sale, as needed.

At September 30, ~~2021, Home Federal~~2022, the Bank exceeded each of its regulatory capital requirements with tangible equity, common equity Tier 1, core, and total risk-based capital ratios of ~~9.57%~~9.50%, ~~15.97%~~13.85%, ~~9.57%~~9.50%, and ~~17.19%~~15.06%, respectively.

Off-Balance Sheet Arrangements

At September 30, ~~2021,~~2022, the Company did not have any off-balance sheet arrangements as defined by Securities and Exchange Commission rules.

Impact of Inflation and Changing Prices

The financial statements and related financial data presented herein have been prepared in accordance with instructions to Form 10-Q which require the measurement of financial position and operating results in terms of historical dollars without considering changes in relative purchasing power over time due to inflation.

Unlike most industrial companies, virtually all of the Company’s assets and liabilities are monetary in nature. As a result, interest rates generally have a more significant impact on a financial institution’s performance than does the effect of inflation.

Index

HOME FEDERAL BANCORP, INC. OF LOUISIANA

Purchases of Equity Securities

Under the Plans or
Programs (a)

Average

Price Paid
per Share

Maximum Number

of Shares that May

Yet Be Purchased

Under the Plans or

Programs (a)

Notes to this table:

On ~~November 18, 2020,~~February 16, 2022, the Company announced that its Board of Directors approved ~~a tenth~~the eleventh stock repurchase program for the repurchase of up to 170,000 ~~shares (split adjusted), or approximately 5.0% of its then outstanding shares of common stock.~~shares. The eleventh stock repurchase program ~~does not have an expiration date.~~was completed on August 2, 2022.

ITEM 5.

OTHER INFORMATION

HOME FEDERAL BANCORP, INC. OF LOUISIANA

No.		Description
31.1		Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer
31.2		Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer
32.0		Certification Pursuant to 18 U.S.C Section 1350
101.INS		Inline XBRL Instance Document
101.SCH		Inline XBRL Taxonomy Extension Schema Document
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF		Inline XBRL Taxonomy Extension Definitions Linkbase Document
104		Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

3738

Index

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	HOME FEDERAL BANCORP, INC. OF LOUISIANA

Date: November ~~12, 2021~~14, 2022	By:	/s/ Glen W. Brown
		Glen W. Brown
		Senior Vice President and Chief Financial Officer
		(Duly authorized officer and principal financial and accounting officer)

		Page
PART I	FINANCIAL INFORMATION

Item 1:	Financial Statements (Unaudited)

	Consolidated Statements of Financial Condition	1

	Consolidated Statements of Income	2

	Consolidated Statements of Comprehensive Income	3

	Consolidated Statements of Changes in ~~Stockholders'~~Stockholders’ Equity	4

	Consolidated Statements of Cash Flows	5

	Notes to Consolidated Financial Statements	7

Item 2:	~~Management's~~Management’s Discussion and Analysis of Financial Condition and Results of Operations	29

Item 3:	Quantitative and Qualitative Disclosures About Market Risk	3536

Item 4:	Controls and Procedures	3536

PART II	OTHER INFORMATION

Item 1:	Legal Proceedings	3637

Item 1A:	Risk Factors	3637

Item 2:	Unregistered Sales of Equity Securities and Use of Proceeds	3637

Item 3:	Defaults Upon Senior Securities	36 37

Item 4:	Mine Safety Disclosures	36 37

Item 5:	Other Information	36 37

Item 6:	Exhibits	37 38

SIGNATURES

September 30, 2021	Unpaid Principal Balance		Recorded Investment With No Allowance		Recorded Investment With Allowance		Total Recorded Investment		Related Allowance		Average Recorded Investment
September 30, 2022													Unpaid Principal Balance		Recorded Investment With No Allowance		Recorded Investment With Allowance		Total Recorded Investment		Related Allowance		Average Recorded Investment
	(In Thousands)												(In Thousands)
Real Estate Loans:
One-to-Four Family Residential	$	487	$	487	$	0	$	487	$	0	$	531	$	2,471	$	161	$	2,310	$	2,471	$	222	$	2,512
Commercial		2,680		1,580		1,100		2,680		301		2,726		1,715		-		1,715		1,715		127		1,732
Multi-Family Residential		0		0		0		0		0		0		-		-		-		-		-		-
Land		0		0		0		0		0		0		-		-		-		-		-		-
Construction		0		0		0		0		0		0		-		-		-		-		-		-
Equity and Second Mortgage		0		0		0		0		0		0		-		-		-		-		-		-
Equity Lines of Credit		0		0		0		0		0		0		-		-		-		-		-		-
Commercial Loans		2,744		0		2,744		2,744		232		2,803		2,652		-		2,652		2,652		132		2,698
Consumer Loans		0		0		0		0		0		0		-		-		-		-		-		-

Total	$	5,911	$	2,067	$	3,844	$	5,911	$	533	$	6,060	$	6,838	$	161	$	6,677	$	6,838	$	481	$	6,942

Period	Total Number of Shares Purchased		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs (a)
July 1, 2021 – July 31, 2021		--	$	--		--		134,000
August 1, 2020 – August 31, 2021		--		--		--		134,000
September 1, 2020 – September 30, 2021		17,672	$	18.89		17,672		116,328
Total		17,672	$	18.89		17,672		116,328