Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Sep. 30, 2013 | Dec. 15, 2013 | Mar. 31, 2013 | |
Entity Registrant Name | 'Magyar Bancorp, Inc. | ' | ' |
Entity Central Index Key | '0001337068 | ' | ' |
Document Type | '10-K | ' | ' |
Document Period End Date | 30-Sep-13 | ' | ' |
Amendment Flag | 'false | ' | ' |
Current Fiscal Year End Date | '--09-30 | ' | ' |
Is Entity a Well-known Seasoned Issuer? | 'No | ' | ' |
Is Entity a Voluntary Filer? | 'No | ' | ' |
Is Entity's Reporting Status Current? | 'Yes | ' | ' |
Entity Filer Category | 'Smaller Reporting Company | ' | ' |
Entity Public Float | ' | ' | $13,400,000 |
Entity Common Stock, Shares Outstanding | ' | 5,811,394 | ' |
Document Fiscal Period Focus | 'FY | ' | ' |
Document Fiscal Year Focus | '2013 | ' | ' |
Magyar Bank, MHC | ' | ' | ' |
Entity Common Stock, Shares Owned by Registrant's mutual holding company | ' | 3,200,450 | ' |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Assets | ' | ' |
Cash | $1,129 | $930 |
Interest earning deposits with banks | 16,663 | 9,114 |
Total cash and cash equivalents | 17,792 | 10,044 |
Investment securities - available for sale, at fair value | 15,774 | 16,786 |
Investment securities - held to maturity, at amortized cost (fair value of $51,802 and $42,130 at September 30, 2013 and 2012, respectively) | 52,558 | 41,068 |
Federal Home Loan Bank of New York stock, at cost | 1,982 | 2,385 |
Loans receivable, net of allowance for loan losses of $3,013 and $3,858 at September 30, 2013 and 2012, respectively | 396,800 | 385,270 |
Bank owned life insurance | 10,342 | 10,010 |
Accrued interest receivable | 1,752 | 1,894 |
Premises and equipment, net | 20,880 | 21,541 |
Other real estate owned ("OREO") | 14,756 | 13,381 |
Other assets | 5,092 | 6,467 |
Total assets | 537,728 | 508,846 |
Liabilities | ' | ' |
Deposits | 453,328 | 416,518 |
Escrowed funds | 1,018 | 769 |
Federal Home Loan Bank of New York advances | 27,100 | 36,503 |
Securities sold under agreements to repurchase | 5,000 | 5,000 |
Accrued interest payable | 141 | 196 |
Accounts payable and other liabilities | 5,821 | 4,855 |
Total liabilities | 492,408 | 463,841 |
Stockholders' equity | ' | ' |
Preferred stock: $.01 Par Value, 1,000,000 shares authorized; none issued | ' | ' |
Common stock: $.01 Par Value, 8,000,000 shares authorized; 5,923,742 issued; 5,811,394 and 5,807,344 shares outstanding at September 30, 2013 and 2012, respectively | 59 | 59 |
Additional paid-in capital | 26,322 | 26,367 |
Treasury stock: 112,348 and 116,398 shares at September 30, 2013 and 2012, respectively, at cost | -1,256 | -1,301 |
Unearned Employee Stock Ownership Plan shares | -1,002 | -1,116 |
Retained earnings | 21,835 | 21,600 |
Accumulated other comprehensive loss | -638 | -604 |
Total stockholders' equity | 45,320 | 45,005 |
Total liabilities and stockholders' equity | $537,728 | $508,846 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, except Share data, unless otherwise specified | ||
Statement of Financial Position [Abstract] | ' | ' |
Fair value of investment securities - held to maturity | $51,802 | $42,130 |
Allowance for loan losses | $3,013 | $3,858 |
Preferred stock; par value | $0.01 | $0.01 |
Preferred stock; shares authorized | 1,000,000 | 1,000,000 |
Preferred stock; shares issued | ' | ' |
Common stock; par value | $0.01 | $0.01 |
Common stock; shares authorized | 8,000,000 | 8,000,000 |
Common stock; shares issued | 5,923,742 | 5,923,742 |
Common stock, shares outstanding | 5,811,394 | 5,807,344 |
Treasury stock, shares | 112,348 | 116,398 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 12 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Interest and dividend income | ' | ' |
Loans, including fees | $17,988 | $18,730 |
Investment securities | ' | ' |
Taxable | 1,580 | 1,968 |
Tax-exempt | 1 | 3 |
Federal Home Loan Bank of New York stock | 105 | 104 |
Total interest and dividend income | 19,674 | 20,805 |
Interest expense | ' | ' |
Deposits | 3,051 | 3,940 |
Borrowings | 1,301 | 1,869 |
Total interest expense | 4,352 | 5,809 |
Net interest and dividend income | 15,322 | 14,996 |
Provision for loan losses | 2,111 | 1,461 |
Net interest and dividend income after provision for loan losses | 13,211 | 13,535 |
Other income | ' | ' |
Service charges | 881 | 997 |
Income on bank owned life insurance | 332 | 350 |
Other operating income | 110 | 67 |
Gains on sales of loans | 406 | 466 |
Gains on sales of investment securities | 121 | 286 |
Total other income | 1,850 | 2,166 |
Other expenses | ' | ' |
Compensation and employee benefits | 7,423 | 7,319 |
Occupancy expenses | 2,805 | 2,874 |
Professional fees | 881 | 978 |
Data processing expenses | 576 | 553 |
OREO expenses | 629 | 810 |
FDIC deposit insurance premiums | 702 | 706 |
Loan servicing expenses | 309 | 342 |
Insurance expense | 228 | 238 |
Other expenses | 1,225 | 1,250 |
Total other expenses | 14,778 | 15,070 |
Income before income tax expense | 283 | 630 |
Income tax expense | 21 | 121 |
Net income | $262 | $509 |
Net income per share-basic and diluted | $0.05 | $0.09 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income (USD $) | 12 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | ||
Statement of Comprehensive Income [Abstract] | ' | ' | ||
Net income | $262 | $509 | ||
Other comprehensive loss: | ' | ' | ||
Net unrealized (loss) gain on securities available for sale | -544 | 276 | ||
Realized gains on sales of securities available for sale | -121 | [1],[2] | -286 | [1],[2] |
Defined benefit pension plan | 697 | -222 | ||
Unrealized loss on derivatives | -54 | -87 | ||
Other comprehensive loss, before tax | -22 | -319 | ||
Deferred income (benefit) tax effect | -12 | 122 | ||
Total other comprehensive loss | -34 | -197 | ||
Total comprehensive income | $228 | $312 | ||
[1] | Realized gains on securities transactions included in gains on sales of investment securities in the accompanying Consolidated Statements of Operations | |||
[2] | Tax effect included in income tax expense in the accompanying Consolidated Statements of Operations |
Consolidated_Statement_of_Chan
Consolidated Statement of Changes in Stockholders' Equity (USD $) | Common Stock | Additional Paid-In Capital | Treasury Stock | Unearned ESOP Shares | Retained Earnings | Accumulated Other Comprehensive Loss | Total |
In Thousands, except Share data | |||||||
Balance, at Sep. 30, 2011 | $59 | $26,496 | ($1,480) | ($1,228) | $21,069 | ($407) | $44,509 |
Balance, shares at Sep. 30, 2011 | 5,801,631 | ' | ' | ' | ' | ' | ' |
Net income | ' | ' | ' | ' | 509 | ' | 509 |
Other comprehensive loss | ' | ' | ' | ' | ' | -197 | -197 |
Purchase of treasury stock | ' | ' | -45 | ' | ' | ' | -45 |
Purchase of treasury stock, shares | -14,030 | ' | ' | ' | ' | ' | ' |
Treasury stock used for restricted stock plan | ' | -246 | 224 | ' | 22 | ' | ' |
Treasury stock used for restricted stock plan, shares | 19,743 | ' | ' | ' | ' | ' | ' |
ESOP shares allocated | ' | -64 | ' | 112 | ' | ' | 48 |
Stock-based compensation expense | ' | 181 | ' | ' | ' | ' | 181 |
Balance, at Sep. 30, 2012 | 59 | 26,367 | -1,301 | -1,116 | 21,600 | -604 | 45,005 |
Balance, shares at Sep. 30, 2012 | 5,807,344 | ' | ' | ' | ' | ' | ' |
Net income | ' | ' | ' | ' | 262 | ' | 262 |
Other comprehensive loss | ' | ' | ' | ' | ' | -34 | -34 |
Treasury stock used for restricted stock plan | ' | -18 | 45 | ' | -27 | ' | ' |
Treasury stock used for restricted stock plan, shares | 4,050 | ' | ' | ' | ' | ' | ' |
ESOP shares allocated | ' | -45 | ' | 114 | ' | ' | 69 |
Stock-based compensation expense | ' | 18 | ' | ' | ' | ' | 18 |
Balance, at Sep. 30, 2013 | $59 | $26,322 | ($1,256) | ($1,002) | $21,835 | ($638) | $45,320 |
Balance, shares at Sep. 30, 2013 | 5,811,394 | ' | ' | ' | ' | ' | ' |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Operating activities | ' | ' |
Net income | $262 | $509 |
Adjustment to reconcile net income to net cash provided by operating activities | ' | ' |
Depreciation expense | 927 | 935 |
Premium amortization on investment securities, net | 231 | 228 |
Provision for loan losses | 2,111 | 1,461 |
Provision for loss on other real estate owned | 42 | 148 |
Proceeds from the sales of loans | 4,957 | 9,209 |
Gains on sale of loans | -406 | -466 |
Gains on sales of investment securities | -121 | -286 |
Losses on the sales of other real estate owned | 78 | 22 |
ESOP compensation expense | 69 | 48 |
Stock-based compensation expense | 18 | 181 |
Deferred income tax expense | 83 | 101 |
Decrease in accrued interest receivable | 142 | 27 |
Increase in surrender value bank owned life insurance | -332 | -350 |
Decrease (increase) in other assets | 1,239 | -145 |
Decrease in accrued interest payable | -55 | -104 |
Increase in accounts payable and other liabilities | 1,663 | 1,307 |
Net cash provided by operating activities | 10,908 | 12,825 |
Investing activities | ' | ' |
Net increase in loans receivable | -22,448 | -20,037 |
Purchases of investment securities held to maturity | -23,777 | -17,210 |
Purchases of investment securities available for sale | -7,075 | -10,156 |
Sales of investment securities available for sale | 4,307 | 14,164 |
Principal repayments on investment securities held to maturity | 12,140 | 21,021 |
Principal repayments on investment securities available for sale | 3,152 | 4,687 |
Purchases of premises and equipment | -266 | -314 |
Investment in other real estate owned | -291 | -1,176 |
Proceeds from the sale of other real estate owned | 3,039 | 8,449 |
Redemption (purchase) of Federal Home Loan Bank stock | 403 | -86 |
Net cash used by investing activities | -30,816 | -658 |
Financing activities | ' | ' |
Net increase (decrease) in deposits | 36,810 | -8,425 |
Net increase (decrease) in escrowed funds | 249 | -274 |
Proceeds from long-term advances | 4,692 | 3,000 |
Repayments of long-term advances | -12,695 | -2,813 |
Net change in short-term advances | -1,400 | 1,400 |
Repayments of securities sold under agreements to repurchase | ' | -10,000 |
Purchase of treasury stock | ' | -45 |
Net cash provided (used) by financing activities | 27,656 | -17,157 |
Net increase (decrease) in cash and cash equivalents | 7,748 | -4,990 |
Cash and cash equivalents, beginning of period | 10,044 | 15,034 |
Cash and cash equivalents, end of period | 17,792 | 10,044 |
Cash paid for | ' | ' |
Interest | 4,407 | 5,914 |
Income taxes | 54 | 8 |
Non-cash investing activities | ' | ' |
Real estate acquired in full satisfaction of loans in foreclosure | 4,256 | 5,817 |
OREO transferred to premises and equipment | ' | $1,588 |
ORGANIZATION
ORGANIZATION | 12 Months Ended |
Sep. 30, 2013 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' |
ORGANIZATION | ' |
NOTE A - ORGANIZATION | |
On January 23, 2006, Magyar Bank (the Bank) completed a reorganization involving a series of transactions by which our corporate structure was changed from a mutual savings bank to the mutual holding company form of ownership. Magyar Bank became a New Jersey-chartered stock savings bank subsidiary of Magyar Bancorp, Inc., a Delaware-chartered mid-tier stock holding company. Magyar Bancorp, Inc. (the “Company”) owns 100% of the outstanding shares of common stock of Magyar Bank. Magyar Bancorp, Inc. is a majority-owned subsidiary of Magyar Bancorp, MHC, a New Jersey-chartered mutual holding company. | |
Magyar Bancorp, MHC, owns 54.0%, or 3,200,450, of the issued shares of common stock of Magyar Bancorp, Inc. Of the remaining shares, 2,610,944, or 44.1%, are held by public stockholders and 112,348, or 1.9%, are held by Magyar Bancorp, Inc. in treasury stock. So long as Magyar Bancorp, MHC exists, it will be required to own a majority of the voting stock of Magyar Bancorp, Inc. Magyar Bancorp, MHC is subject to comprehensive regulation and examination by the Board of Governors of the Federal Reserve System and the New Jersey Department of Banking and Insurance. | |
Magyar Bank (the “Bank”) is subject to regulations issued by the New Jersey Department of Banking and Insurance and the Federal Deposit Insurance Corporation. The Bank’s administrative offices are located in New Brunswick, New Jersey. The Bank has six branch offices which are located in New Brunswick, North Brunswick, South Brunswick, Branchburg, Bridgewater, and Edison, New Jersey. The Bank’s savings deposits are insured by the FDIC through the Deposit Insurance Fund (DIF); also, the Bank is a member of the Federal Home Loan Bank of New York. | |
MagBank Investment Company, a New Jersey investment corporation subsidiary of Magyar Bank, was formed on August 15, 2006 for the purpose of buying, selling and holding investment securities. | |
Hungaria Urban Renewal, LLC is a Delaware limited-liability corporation established in 2002 as a qualified intermediary operating for the purpose of acquiring and developing Magyar Bank’s new main office. The Bank owns a 100% interest in Hungaria Urban Renewal, LLC, which has no other business other than owning the Bank’s main office site. | |
Magyar Service Corporation, a New Jersey corporation, is a wholly owned, non-bank subsidiary of Magyar Bank. Magyar Service Corporation, which also operates under the name Magyar Financial Services, receives commissions from annuity and life insurance sales referred to a licensed, non-bank financial planner. | |
The Bank competes with other banking and financial institutions in its primary market areas. Commercial banks, savings banks, savings and loan associations, credit unions and money market funds actively compete for savings and time certificates of deposit and all types of loans. Such institutions, as well as consumer financial and insurance companies, may be considered competitors of the Bank with respect to one or more of the services it renders. | |
The Bank is subject to regulations of certain state and federal agencies and, accordingly, the Bank is periodically examined by such regulatory authorities. As a consequence of the regulation of commercial banking activities, the Bank’s business is particularly susceptible to future state and federal legislation and regulations. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended | ||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | ||||||||||||||||||||||||
NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||||||||||||||||||||||||
1. Basis of Financial Statement Presentation | |||||||||||||||||||||||||
The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America (US GAAP) and predominant practices within the banking industry. The financial statements include the accounts of the Company and its wholly owned subsidiary, the Bank, and its wholly-owned subsidiaries MagBank Investment Company, Magyar Service Corporation, and Hungaria Urban Renewal, LLC. All intercompany balances and transactions have been eliminated in the financial statements. | |||||||||||||||||||||||||
The Company has evaluated subsequent events and transactions occurring subsequent to the consolidated balance sheet date of September 30, 2013, for items that should potentially be recognized or disclosed in these financial statements. The evaluation was conducted through the date these financial statements were issued. | |||||||||||||||||||||||||
In preparing financial statements in conformity with US GAAP, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. | |||||||||||||||||||||||||
The principal estimates that are particularly susceptible to significant change in the near term relate to the allowance for loan losses and the deferred tax asset. The evaluation of the adequacy of the allowance for loan losses includes an analysis of the individual loans and overall risk characteristics and size of the different loan portfolios, and takes into consideration current economic and market conditions, the capability of specific borrowers to pay specific loan obligations, as well as current loan collateral values. However, actual losses on specific loans, which also are encompassed in the analysis, may vary from estimated losses. | |||||||||||||||||||||||||
The Company records income taxes using the asset and liability method. Accordingly, deferred tax assets and liabilities: (i) are recognized for the expected future tax consequences of events that have been recognized in the financial statements or tax returns; (ii) are attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases; and (iii) are measured using enacted tax rates expected to apply in the years when those temporary differences are expected to be recovered or settled. | |||||||||||||||||||||||||
Where applicable, deferred tax assets are reduced by a valuation allowance for any portions determined not likely to be realized. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income tax expense in the period of enactment. The valuation allowance is adjusted, by a charge or credit to income tax expense, as changes in facts and circumstances warrant. | |||||||||||||||||||||||||
2. Cash and Cash Equivalents | |||||||||||||||||||||||||
For purposes of reporting cash flows, cash and cash equivalents include cash on hand, amounts due from banks, time deposits with original maturities less than three months and overnight deposits. | |||||||||||||||||||||||||
3. Investment Securities | |||||||||||||||||||||||||
The Company classifies its investment securities into one of three portfolios: held to maturity, available for sale or trading. Investments in debt securities that we have the positive intent and ability to hold to maturity are classified as held to maturity securities and reported at amortized cost. Debt and equity securities that are bought and held principally for the purpose of selling them in the near term are classified as trading securities and reported at fair value, with unrealized holding gains and losses included in earnings. Debt and equity securities not classified as trading securities or as held to maturity securities are classified as available for sale securities and reported at fair value, with unrealized holding gains or losses, net of deferred income taxes, reported in the accumulated other comprehensive income (“AOCI”) component of stockholders’ equity. | |||||||||||||||||||||||||
If the fair value of a security is less than its amortized cost, the security is deemed to be impaired. Management evaluates all securities with unrealized losses quarterly to determine if such impairments are “temporary” or “other-than-temporary” in accordance with applicable accounting guidance. The Company accounts for temporary impairments based upon security classification as either available for sale, held to maturity or trading. Temporary impairments on “available for sale” securities are recognized, on a tax-effected basis, through AOCI with offsetting entries adjusting the carrying value of the security and the balance of deferred taxes. Conversely, the Company does not adjust the carrying value of “held to maturity” securities for temporary impairments, although information concerning the amount and duration of impairments on held to maturity securities is generally disclosed in periodic financial statements. The carrying value of securities held in a trading portfolio is adjusted to their fair value through earnings on a daily basis. However, the Company maintained no securities in trading portfolios at or during the periods presented in these financial statements. | |||||||||||||||||||||||||
The Company accounts for other-than-temporary impairments based upon several considerations. First, other-than-temporary impairments on securities that the Company has decided to sell as of the close of a fiscal period, or will, more likely than not, be required to sell prior to the full recovery of the their fair value to a level equal to or exceeding their amortized cost, are recognized in operations. If neither of these criteria apply, then the other-than-temporary impairment is separated into credit-related and noncredit-related components. The credit-related impairment generally represents the amount by which the present value of the cash flows that are expected to be collected on an other-than-temporarily impaired security fall below its amortized cost while the noncredit-related component represents the remaining portion of the impairment not otherwise designated as credit-related. The Company recognizes credit-related, other-than-temporary impairments in earnings, while noncredit-related, other-than-temporary impairments on debt securities are recognized, net of deferred taxes, in AOCI. | |||||||||||||||||||||||||
Federal law requires a member institution of the Federal Home Loan Bank (“FHLB”) system to purchase and hold restricted stock of its district FHLB according to a predetermined formula. This stock is restricted in that it may only be sold to the FHLB and all sales must be at par. Accordingly, the FHLB restricted stock is carried at cost, less any applicable impairment charges. | |||||||||||||||||||||||||
Premiums and discounts on all securities are amortized or accreted to maturity by use of the level-yield method considering the impact of principal amortization and prepayments on mortgage-backed securities. Gain or loss on sales of securities is recognized on the specific identification method. | |||||||||||||||||||||||||
4. Loans and Allowance for Loan Losses | |||||||||||||||||||||||||
Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are stated at the amount of unpaid principal, adjusted for net deferred loan fees and costs, and reduced by an allowance for loan losses. Interest on loans is accrued and credited to operations based upon the principal amounts outstanding. The allowance for loan losses is established through a provision for possible loan losses charged to operations. Loans are charged against the allowance for loan losses when management believes that the collectability of the principal is unlikely. | |||||||||||||||||||||||||
Income recognition of interest is discontinued when, in the opinion of management, the collectability of such interest becomes doubtful. A loan is generally classified as non-accrual when the scheduled payment(s) due on the loan is delinquent for more than three months. Loan origination fees and certain direct origination costs are deferred and amortized over the life of the related loans as an adjustment to the yield on loans receivable using the effective interest method. | |||||||||||||||||||||||||
Management uses a ten point internal risk rating system to monitor the credit quality of the overall loan portfolio. The first six categories are considered not criticized, and are aggregated as “Pass” rated. The criticized rating categories utilized by management generally follow bank regulatory definitions. The Special Mention category includes assets that are currently protected but are potentially weak, resulting in an undue and unwarranted credit risk, but not to the point of justifying a Substandard classification. Loans in the Substandard category have well-defined weaknesses that jeopardize the liquidation of the debt, and have a distinct possibility that some loss will be sustained if the weaknesses are not corrected. All loans greater than three months past due are considered Substandard. Any portion of a loan that has been charged off is placed in the Loss category. | |||||||||||||||||||||||||
To help ensure that risk ratings are accurate and reflect the present and future capacity of borrowers to repay a loan as agreed, the Bank has a structured loan rating process with several layers of internal and external oversight. Generally, consumer and residential mortgage loans are included in the Pass categories unless a specific action, such as severe delinquency, bankruptcy, repossession, or death occurs to raise awareness of a possible credit event. The Bank’s Commercial Loan Officers are responsible for the timely and accurate risk rating of the loans in their portfolios at origination and on an ongoing basis. The Asset Review Committee performs monthly reviews of all commercial relationships internally rated 6 (“Watch”) or worse. Confirmation of the appropriate risk grade is performed by an external loan review company that semi-annually reviews and assesses loans within the portfolio. Generally, the external consultant reviews commercial relationships greater than $500,000 and/or criticized relationships greater than $250,000. Detailed reviews, including plans for resolution, are performed on loans classified as Substandard on a monthly basis. | |||||||||||||||||||||||||
The allowance for loan losses is maintained at an amount management deems adequate to cover estimated losses. In determining the level to be maintained, management evaluates many factors, including current economic trends, industry experience, historical loss experience, industry loan concentrations, the borrowers’ ability to repay and repayment performance, and estimated collateral values. In the opinion of management, the present allowance is adequate to absorb reasonable, foreseeable loan losses. While management uses the best information available to make such evaluations, future adjustments to the allowance may be necessary based on changes in economic conditions or any of the other factors used in management’s determination. In addition, various regulatory agencies, as an integral part of their examination process, periodically review the Company’s allowance for losses on loans. Such agencies may require the Company to recognize additions to the allowance based on their judgments about information available to them at the time of their examination. Charge-offs to the allowance are made when the loan is transferred to other real estate owned or other determination of a confirmed loss. Recoveries on loans previously charged off are also recorded through the allowance. | |||||||||||||||||||||||||
A loan is considered impaired when, based upon current information and events, it is probable that a creditor will be unable to collect all amounts due including principal and interest, according to the contractual terms of the loan agreement. The Company measures impaired loans based on the present value of expected future cash flows discounted at the loan’s effective interest rate or as a practical expedient, at the loan’s current observable market price, or the fair value of the collateral if the loan is collateral dependent. The amount by which the recorded investment of an impaired loan exceeds the measurement value is recognized by creating a valuation allowance through a charge to the provision for loan losses. Impairment criteria generally do not apply to those smaller-balance homogeneous loans that are collectively evaluated for impairment which for the Company includes one- to four-family first mortgage loans and consumer loans, other than those modified in a troubled debt restructuring. | |||||||||||||||||||||||||
The Company records cash receipts on impaired loans that are non-performing as a reduction to principal before applying amounts to interest or late charges unless specifically directed by the Bankruptcy Court to apply payments otherwise. The Company continues to recognize interest income on impaired loans where there is no confirmed loss. | |||||||||||||||||||||||||
5. Premises and Equipment | |||||||||||||||||||||||||
Premises and equipment are carried at cost less accumulated depreciation, and include capitalized expenditures for new facilities, major betterments and renewals. Expenditures for maintenance and repairs are charged to expense as incurred. Depreciation is computed using the straight-line method based upon the estimated useful lives of the related assets for financial reporting purposes and using the mandated methods by asset type for income tax purposes. Leasehold improvements are depreciated using the straight-line method based upon the initial term of the lease. | |||||||||||||||||||||||||
The Company accounts for the impairment of long-lived assets in accordance with US GAAP, which requires recognition and measurement for the impairment of long-lived assets to be held and used or to be disposed of by sale. The Company had no impaired long-lived assets at September 30, 2013 and 2012 | |||||||||||||||||||||||||
6. Derivative Contracts | |||||||||||||||||||||||||
Derivative contracts are carried at fair value with unrealized gains and losses excluded from earnings and reported in a separate component of stockholders’ equity, net of related income tax effects. Gains and losses on derivative contracts are recognized upon realization utilizing the specific identification method. | |||||||||||||||||||||||||
As required by US GAAP, the Company recognizes all derivatives as either assets or liabilities in the statement of financial condition and measures those instruments at fair value. | |||||||||||||||||||||||||
7. Other Real Estate Owned | |||||||||||||||||||||||||
Real estate acquired through foreclosure, or a deed-in-lieu of foreclosure, is recorded at fair value less estimated selling costs at the date of acquisition or transfer, and subsequently at the lower of its new cost or fair value less estimated selling costs. Adjustments to the carrying value at the date of acquisition or transfer are charged to the allowance for loan losses. The carrying value of the individual properties is subsequently adjusted to the extent it exceeds estimated fair value less estimated selling costs, at which time a provision for losses on such real estate is charged to operations. | |||||||||||||||||||||||||
Operating expenses of holding real estate, net of related income, are charged against income as incurred. Gains on sales of real estate are recognized, normally at closing, when down payment and certain other requirements are met; otherwise such gains are deferred and recognized on the installment method of accounting. Losses on the disposition of real estate, including expenses incurred in connection with the disposition, are charged to operations. | |||||||||||||||||||||||||
8. Income Taxes | |||||||||||||||||||||||||
The Company and its subsidiaries file consolidated federal and individual state income tax returns. Income taxes are allocated based on the contribution of their respective income or loss to the consolidated income tax return. | |||||||||||||||||||||||||
The Company records income taxes on the basis of reported income using the asset and liability method. Accordingly, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. To the extent that current available evidence about the future raises doubt about the realization of a deferred tax asset, a valuation allowance is established. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. | |||||||||||||||||||||||||
The Company follows the provisions of FASB ASC Topic 740, which provides clarification on accounting for uncertainty in income taxes recognized in an enterprise’s financial statements. The guidance prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return, and also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. At September 30, 2013 and 2012, no significant income tax uncertainties have been included in the Company’s Consolidated Balance Sheets. The Company’s policy is to recognize interest and penalties on unrecognized tax benefits in income tax expense in the Consolidated Statements of Operations. No interest and penalties were recorded during the years ended September 30, 2013 and 2012. The tax years subject to examination by the taxing authorities are the years ended September 30, 2008 and forward. | |||||||||||||||||||||||||
9. Advertising Costs | |||||||||||||||||||||||||
The Company expenses advertising costs as incurred. | |||||||||||||||||||||||||
10. Earnings Per Share | |||||||||||||||||||||||||
Basic income per share is calculated by dividing income available to common stockholders by the weighted average number of shares of common stock outstanding for the period. The weighted average common shares outstanding include shares held by the Magyar Bancorp, MHC and shares allocated to the Employee Stock Ownership Plan. | |||||||||||||||||||||||||
Diluted income per share is calculated by adjusting the weighted average common shares outstanding to reflect the potential dilution that could occur using the treasury stock method if securities or other contracts to issue common stock, such as stock options and unvested restricted stock, were exercised and converted into common stock. The resulting shares issued would share in the earnings of the Company. Shares issued and shares reacquired during the period are weighted for the portion of the period that they were outstanding. In periods of loss, dilution is not calculated and diluted loss per share is equal to basic loss per share. | |||||||||||||||||||||||||
The following tables illustrate the reconciliation of the numerators and denominators of the basic and diluted earnings per share (EPS) calculations. All options were anti-dilutive at September 30, 2012. | |||||||||||||||||||||||||
For the Years Ended September 30, | |||||||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||||||
Weighted | Per | Weighted | Per | ||||||||||||||||||||||
average | share | average | share | ||||||||||||||||||||||
Income | shares | Amount | Income | shares | Amount | ||||||||||||||||||||
(In thousands, except share and per share data) | |||||||||||||||||||||||||
Basic EPS | |||||||||||||||||||||||||
Net income available to common shareholders | $ | 262 | 5,810,910 | $ | 0.05 | $ | 509 | 5,810,294 | $ | 0.09 | |||||||||||||||
Effect of dilutive securities | |||||||||||||||||||||||||
Options and grants | — | 863 | — | — | — | — | |||||||||||||||||||
Diluted EPS | |||||||||||||||||||||||||
Net income available to common shareholders plus assumed conversion | $ | 262 | 5,811,773 | $ | 0.05 | $ | 509 | 5,810,294 | $ | 0.09 | |||||||||||||||
11 | Comprehensive Income and Accumulated Other Comprehensive Income | ||||||||||||||||||||||||
Comprehensive income includes net income as well as certain other items which result in a change to equity during the period. | |||||||||||||||||||||||||
The other items allocated to comprehensive income, as well as the related income tax effects, for the years ended September 30, 2013 and 2012 were as follows: | |||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||||||
Tax | Net of | Tax | Net of | ||||||||||||||||||||||
Before Tax | (Benefit) | Tax | Before Tax | (Benefit) | Tax | ||||||||||||||||||||
Amount | Expense | Amount | Amount | Expense | Amount | ||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||
Unrealized holding gains (losses) arising | |||||||||||||||||||||||||
during period on: | |||||||||||||||||||||||||
Available-for-sale investments | $ | (544 | ) | $ | 197 | $ | (347 | ) | $ | 276 | $ | (116 | ) | $ | 160 | ||||||||||
Less reclassification adjustment for net gains | |||||||||||||||||||||||||
realized on available-for-sale investments (a) (b) | (121 | ) | 48 | (73 | ) | (286 | ) | 114 | (172 | ) | |||||||||||||||
Defined benefit pension plan | 697 | (278 | ) | 419 | (222 | ) | 89 | (133 | ) | ||||||||||||||||
Interest rate derivatives | (54 | ) | 21 | (33 | ) | (87 | ) | 35 | (52 | ) | |||||||||||||||
Other comprehensive gain (loss), net | $ | (22 | ) | $ | (12 | ) | $ | (34 | ) | $ | (319 | ) | $ | 122 | $ | (197 | ) | ||||||||
(a) | Realized gains on securities transactions included in gains on sales of investment securities in the accompanying Consolidated Statements of Operations | ||||||||||||||||||||||||
(b) | Tax effect included in income tax expense in the accompanying Consolidated Statements of Operations | ||||||||||||||||||||||||
The components of accumulated other comprehensive loss at September 30, 2013 and 2012 were as follows: | |||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||
Available-for-sale investments | $ | (114 | ) | $ | 306 | ||||||||||||||||||||
Defined benefit pension plan | (524 | ) | (943 | ) | |||||||||||||||||||||
Interest rate derivatives | — | 33 | |||||||||||||||||||||||
Total accumulated other comprehensive loss | $ | (638 | ) | $ | (604 | ) | |||||||||||||||||||
12 | Bank-Owned Life Insurance | ||||||||||||||||||||||||
The Company has purchased Bank-Owned Life Insurance policies (“BOLI”). BOLI involves the purchasing of life insurance by the Company on directors and executive officers. The proceeds are used to help defray the costs of non-qualified compensation plans. The Company is the owner and beneficiary of the policies. BOLI is recorded on the consolidated Balance Sheet at its cash surrender value and changes in the cash surrender value are recorded in non-interest income. | |||||||||||||||||||||||||
13 | Segment Reporting | ||||||||||||||||||||||||
The Company acts as an independent, community, financial services provider, and offers traditional banking and related financial services to individual, business and government customers. The Company offers a full array of commercial and retail financial services, including the taking of time, savings and demand deposits; the making of commercial, consumer and home equity loans; and the provision of other financial services. | |||||||||||||||||||||||||
Management does not separately allocate expenses, including the cost of funding loan demand, between the commercial and retail operations of the Company. As such, discrete financial information is not available and segment reporting would not be meaningful. | |||||||||||||||||||||||||
14 | New Accounting Pronouncements | ||||||||||||||||||||||||
In connection with the preparation of quarterly and annual reports in accordance with the Securities and Exchange Commission’s (SEC) Securities Exchange Act of 1934, SEC Staff Accounting Bulletin Topic 11.M requires the disclosure of the impact that recently issued accounting standards will have on financial statements when they are adopted in the future. | |||||||||||||||||||||||||
The FASB issued ASU 2011-04, Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs, to amend FASB ASC Topic 820, Fair Value Measurements, to bring U.S. GAAP for fair value measurements in line with International Accounting Standards. The ASU clarifies existing guidance for items such as: the application of the highest and best use concept to non-financial assets and liabilities; the application of fair value measurement to financial instruments classified in a reporting entity’s stockholder’s equity; and disclosure requirements regarding quantitative information about unobservable inputs used in the fair value measurements of level 3 assets. The ASU also creates an exception to Topic 820 for entities which carry financial instruments within a portfolio or group, under which the entity is now permitted to base the price used for fair valuation upon a price that would be received to sell the net asset position or transfer a net liability position in an orderly transaction. The ASU also allows for the application of premiums and discounts in a fair value measurement if the financial instrument is categorized in level 2 or 3 of the fair value hierarchy. Lastly, the ASU contains new disclosure requirements regarding fair value amounts categorized as level 3 in the fair value hierarchy such as: disclosure of the valuation process used; effects of and relationships between unobservable inputs; usage of nonfinancial assets for purposes other than their highest and best use when that is the basis of the disclosed fair value; and categorization by level of items disclosed at fair value, but not measured at fair value for financial statement purposes. This ASU was effective for interim and annual periods beginning after December 15, 2011. The updates to Topic 820 did not have a material impact on the Company’s consolidated financial statements. | |||||||||||||||||||||||||
In February 2013, the FASB issued ASU No. 2013-02, “Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income,” to improve the transparency of reporting these reclassifications. ASU No. 2013-02 does not amend any existing requirements for reporting net income or other comprehensive income in the financial statements. ASU No. 2013-02 requires an entity to disaggregate the total change of each component of other comprehensive income and separately present reclassification adjustments and current period other comprehensive income. The provisions of ASU No. 2013-02 also require that entities present in a single note or parenthetically on the face of the financial statements, the effect of significant amounts reclassified from each component of accumulated other comprehensive income based on its source and the income statement line item affected by the reclassification. If a component is not required to be reclassified to net income in its entirety, entities would instead cross-reference to the related note to the financial statements for additional information. The Company adopted the provisions of ASU No. 2013-02 effective January 1, 2013. As the Company provided these required disclosures in the notes to the Consolidated Financial Statements, the adoption of ASU No. 2013-02 had no impact on the Company’s consolidated statements of income and condition. See Note B. 11 to the Consolidated Financial Statements for the disclosures required by ASU No. 2013-02. |
STOCKBASED_COMPENSATION
STOCK-BASED COMPENSATION | 12 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Stock-Based Compensation | ' | ||||||||||||||||
STOCK-BASED COMPENSATION | ' | ||||||||||||||||
NOTE C – STOCK-BASED COMPENSATION | |||||||||||||||||
The Company follows FASB Accounting Standards Codification (“ASC”) Section 718, Compensation-Stock Compensation, which covers a wide range of share-based compensation arrangements including share options, restricted share plans, performance-based awards, share appreciation rights, and employee share purchase plans. ASC 718 requires that compensation cost relating to share-based payment transactions be recognized in financial statements. The cost is measured based on the fair value of the equity or liability instruments issued. | |||||||||||||||||
ASC 718 also requires the Company to realize as a financing cash flow rather than an operating cash flow, as previously required, the benefits of realized tax deductions in excess of previously recognized tax benefits on compensation expense. In accordance with SEC Staff Accounting Bulletin (“SAB”) No. 107, the Company classified share-based compensation for employees and outside directors within “compensation and employee benefits” in the consolidated statement of operations to correspond with the same line item as the cash compensation paid. | |||||||||||||||||
Stock options generally vest over a five-year service period and expire ten years from issuance. Management recognizes compensation expense for all option grants over the awards’ respective requisite service periods. The fair values of all option grants were estimated using the Black-Scholes option-pricing model. Since there was limited historical information on the volatility of the Company’s stock, management also considered the average volatilities of similar entities for an appropriate period in determining the assumed volatility rate used in the estimation of fair value. Management estimated the expected life of the options using the simplified method allowed under SAB No. 107. The 7-year Treasury yield in effect at the time of the grant provided the risk-free rate for periods within the contractual life of the option. Management recognizes compensation expense for the fair values of these awards, which have graded vesting, on a straight-line basis over the requisite service period of the awards. Once vested, these awards are irrevocable. Shares will be obtained from either the open market or treasury stock upon share option exercise. | |||||||||||||||||
Restricted shares generally vest over a five-year service period on the anniversary of the grant date. Once vested, these awards are irrevocable. The product of the number of shares granted and the grant date market price of the Company’s common stock determine the fair value of restricted shares under the Company’s restricted stock plans. Management recognizes compensation expense for the fair value of restricted shares on a straight-line basis over the requisite service period. | |||||||||||||||||
The following is a summary of the status of the Company’s stock option activity and related information for its option plan for the two-year period ended September 30, 2013: | |||||||||||||||||
Weighted | |||||||||||||||||
Weighted | Average | Aggregate | |||||||||||||||
Number of | Average | Remaining | Intrinsic | ||||||||||||||
Stock Options | Exercise Price | Contractual Life | Value | ||||||||||||||
Balance at September 30, 2011 | 188,276 | $ | 14.61 | 5.4 years | $ | — | |||||||||||
Granted | — | — | |||||||||||||||
Exercised | — | — | |||||||||||||||
Forfeited | — | $ | — | ||||||||||||||
Balance at September 30, 2012 | 188,276 | $ | 14.61 | 4.4 years | $ | — | |||||||||||
Granted | — | — | |||||||||||||||
Exercised | — | — | |||||||||||||||
Forfeited | — | — | |||||||||||||||
Balance at September 30, 2013 | 188,276 | $ | 14.61 | 3.4 years | $ | — | |||||||||||
Exercisable at September 30, 2013 | 188,276 | $ | 14.61 | 3.4 years | $ | — | |||||||||||
No stock options were granted or exercised during the years ended September 30, 2013 and 2012. | |||||||||||||||||
The following is a summary of the status of the Company’s non-vested restricted shares as of September 30, 2013 and 2012, and changes during those years: | |||||||||||||||||
Weighted | |||||||||||||||||
Average | |||||||||||||||||
Number of | Grant Date | ||||||||||||||||
Stock Awards | Fair Value | ||||||||||||||||
Balance at September 30, 2011 | 33,145 | $ | 9.22 | ||||||||||||||
Granted | — | — | |||||||||||||||
Vested | (19,743 | ) | 12.48 | ||||||||||||||
Forfeited | — | — | |||||||||||||||
Balance at September 30, 2012 | 13,402 | 4.43 | |||||||||||||||
Granted | — | — | |||||||||||||||
Vested | (4,050 | ) | 4.44 | ||||||||||||||
Forfeited | — | — | |||||||||||||||
Balance at September 30, 2013 | 9,352 | $ | 4.42 | ||||||||||||||
Stock option and stock award expenses included with compensation expense were $0 and $18,000, respectively, for the year ended September 30, 2013, and $68,000 and $113,000, respectively, for the year ended September 30, 2012. The Company had no other stock-based compensation plans as of September 30, 2013 except as disclosed below. | |||||||||||||||||
On April 27, 2007 the Company announced its first stock repurchase program and authorized the repurchase of up to 5% of its publicly-held outstanding shares of common stock, or approximately 130,927 shares. The Company completed its first stock repurchase program of 130,927 shares in November 2007 and announced a second repurchase program of up to 5% of its publicly-held outstanding shares of common stock, or 129,924 shares in November 2007. Pursuant to the second repurchase program, the Company had repurchased 81,000 shares of its common stock at an average cost of $8.33 per share through September 30, 2013, leaving 48,924 shares available for repurchase. One of the Company’s intended uses of the repurchased shares is to satisfy awards granted under the 2006 Equity Incentive Plan. | |||||||||||||||||
The Company has an Employee Stock Ownership Plan ("ESOP") for the benefit of employees who meet the eligibility requirements as defined in the plan. The ESOP trust purchased 217,863 shares of common stock in the open market using proceeds of a loan from the Company. The total cost of shares purchased by the ESOP trust was $2.3 million, reflecting an average cost per share of $10.58. The Bank will make cash contributions to the ESOP on an annual basis sufficient to enable the ESOP to make the required loan payments to the Company. The loan bears a variable interest rate that adjusts annually to Prime (3.25% at September 30, 2013) with principal and interest payable annually in equal installments over thirty years. The loan is secured by shares of the Company’s stock. | |||||||||||||||||
As the debt is repaid, shares are released as collateral and allocated to qualified employees. Accordingly, the shares pledged as collateral are reported as unearned ESOP shares in the Consolidated Balance Sheet. The Company accounts for its ESOP in accordance with FASB ASC Topic 718, “Employer’s Accounting for Employee Stock Ownership Plans”. As shares are released from collateral, the Company reports compensation expense equal to the current market price of the shares, and the shares become outstanding for earnings per share computations. The Company's contribution expense for the ESOP was $69,000 and $49,000 for years ended September 30, 2013 and 2012, respectively. | |||||||||||||||||
The following table presents the components of the ESOP shares as of September 30, 2013: | |||||||||||||||||
Unreleased shares at September 30, 2012 | 114,318 | ||||||||||||||||
Shares released for allocation during the year ended September 30, 2013 | (12,445 | ) | |||||||||||||||
Unreleased shares at September 30, 2013 | 101,873 | ||||||||||||||||
Total released shares | 115,990 | ||||||||||||||||
Total ESOP shares | 217,863 | ||||||||||||||||
The aggregate fair value of the unreleased shares at September 30, 2013 was approximately $756,000. |
INVESTMENT_SECURITIES
INVESTMENT SECURITIES | 12 Months Ended | ||||||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||||||
InvestmentSecuritiesAbstract | ' | ||||||||||||||||||||||||||||
INVESTMENT SECURITIES | ' | ||||||||||||||||||||||||||||
NOTE D - INVESTMENT SECURITIES | |||||||||||||||||||||||||||||
The unamortized cost, gross unrealized gains or losses and fair value of the Company’s investment securities available-for-sale and held-to-maturity are as follows: | |||||||||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||||||
Gross | Gross | ||||||||||||||||||||||||||||
Amortized | Unrealized | Unrealized | Fair | ||||||||||||||||||||||||||
Cost | Gains | Losses | Value | ||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||
Securities available-for-sale: | |||||||||||||||||||||||||||||
Obligations of U.S. government agencies: | |||||||||||||||||||||||||||||
Mortgage-backed securities - residential | $ | 1,551 | $ | 5 | $ | — | $ | 1,556 | |||||||||||||||||||||
Obligations of U.S. government-sponsored enterprises: | |||||||||||||||||||||||||||||
Mortgage-backed securities - residential | 9,633 | 9 | (241 | ) | 9,401 | ||||||||||||||||||||||||
Mortgage-backed securities - commercial | 3,963 | 39 | — | 4,002 | |||||||||||||||||||||||||
Private label mortgage-backed securities - residential | 808 | 9 | (2 | ) | 815 | ||||||||||||||||||||||||
Total securities available-for-sale | 15,955 | 62 | (243 | ) | 15,774 | ||||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||||||
Gross | Gross | ||||||||||||||||||||||||||||
Amortized | Unrealized | Unrealized | Fair | ||||||||||||||||||||||||||
Cost | Gains | Losses | Value | ||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||
Securities held-to-maturity: | |||||||||||||||||||||||||||||
Obligations of U.S. government agencies: | |||||||||||||||||||||||||||||
Mortgage-backed securities - residential | $ | 9,455 | $ | 231 | $ | (121 | ) | $ | 9,565 | ||||||||||||||||||||
Mortgage-backed securities - commercial | 1,433 | — | (3 | ) | 1,430 | ||||||||||||||||||||||||
Obligations of U.S. government-sponsored enterprises: | |||||||||||||||||||||||||||||
Mortgage-backed securities - residential | 33,758 | 363 | (975 | ) | 33,146 | ||||||||||||||||||||||||
Debt securities | 4,000 | — | (267 | ) | 3,733 | ||||||||||||||||||||||||
Private label mortgage-backed securities - residential | 901 | 27 | (11 | ) | 917 | ||||||||||||||||||||||||
Obligations of state and political subdivisions | 11 | — | — | 11 | |||||||||||||||||||||||||
Corporate securities | 3,000 | — | — | 3,000 | |||||||||||||||||||||||||
Total securities held-to-maturity | 52,558 | 621 | (1,377 | ) | 51,802 | ||||||||||||||||||||||||
At September 30, 2012 | |||||||||||||||||||||||||||||
Gross | Gross | ||||||||||||||||||||||||||||
Amortized | Unrealized | Unrealized | Fair | ||||||||||||||||||||||||||
Cost | Gains | Losses | Value | ||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||
Securities available-for-sale: | |||||||||||||||||||||||||||||
Obligations of U.S. government agencies: | |||||||||||||||||||||||||||||
Mortgage-backed securities - residential | $ | 1,850 | $ | 11 | $ | — | $ | 1,861 | |||||||||||||||||||||
Obligations of U.S. government-sponsored enterprises: | |||||||||||||||||||||||||||||
Mortgage-backed securities - residential | 8,368 | 207 | — | 8,575 | |||||||||||||||||||||||||
Mortgage-backed securities - commercial | 4,053 | 175 | — | 4,228 | |||||||||||||||||||||||||
Debt securities | 1,000 | 67 | — | 1,067 | |||||||||||||||||||||||||
Private label mortgage-backed securities - residential | 1,031 | 25 | (1 | ) | 1,055 | ||||||||||||||||||||||||
Total securities available-for-sale | $ | 16,302 | $ | 485 | $ | (1 | ) | $ | 16,786 | ||||||||||||||||||||
At September 30, 2012 | |||||||||||||||||||||||||||||
Gross | Gross | ||||||||||||||||||||||||||||
Amortized | Unrealized | Unrealized | Fair | ||||||||||||||||||||||||||
Cost | Gains | Losses | Value | ||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||
Securities held-to-maturity: | |||||||||||||||||||||||||||||
Obligations of U.S. government agencies: | |||||||||||||||||||||||||||||
Mortgage-backed securities - residential | $ | 10,790 | $ | 414 | $ | (8 | ) | $ | 11,196 | ||||||||||||||||||||
Mortgage-backed securities - commercial | 1,522 | 14 | — | 1,536 | |||||||||||||||||||||||||
Obligations of U.S. government-sponsored enterprises: | |||||||||||||||||||||||||||||
Mortgage-backed securities - residential | 18,578 | 722 | (5 | ) | 19,295 | ||||||||||||||||||||||||
Debt securities | 5,770 | 6 | — | 5,776 | |||||||||||||||||||||||||
Private label mortgage-backed securities - residential | 1,367 | 27 | — | 1,394 | |||||||||||||||||||||||||
Obligations of state and political subdivisions | 41 | 1 | — | 42 | |||||||||||||||||||||||||
Corporate securities | 3,000 | — | (109 | ) | 2,891 | ||||||||||||||||||||||||
Total securities held-to-maturity | $ | 41,068 | $ | 1,184 | $ | (122 | ) | $ | 42,130 | ||||||||||||||||||||
The contractual maturities of mortgage-backed securities generally exceed 10 years; however, the effective lives are expected to be shorter due to anticipated prepayments. The amortized cost and fair value of the Company’s securities available-for-sale at September 30, 2013 are summarized in the following table: | |||||||||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||||||
Amortized | Fair | ||||||||||||||||||||||||||||
Cost | Value | ||||||||||||||||||||||||||||
Total debt securities | $ | — | $ | — | |||||||||||||||||||||||||
Mortgage-backed securities: | |||||||||||||||||||||||||||||
Residential(1) | 11,992 | 11,772 | |||||||||||||||||||||||||||
Commercial(2) | 3,963 | 4,002 | |||||||||||||||||||||||||||
Total | $ | 15,955 | $ | 15,774 | |||||||||||||||||||||||||
-1 | Available-for-sale mortgage-backed securities – residential include an amortized cost of $1.6 million and a fair value of $1.6 million for obligations of U.S. government agencies issued by the Government National Mortgage Association and obligations of U.S. government-sponsored enterprises issued by Federal National Mortgage Association and Federal Home Loan Mortgage Corporation which had an amortized cost of $9.6 million and a fair value of $9.4 million. Also included are residential mortgage-backed securities issued by non-U.S. government agencies and government-sponsored enterprises with an amortized cost of $808,000 and fair value of $815,000. | ||||||||||||||||||||||||||||
-2 | Available-for-sale mortgage-backed securities – commercial include an amortized cost of $4.0 million and a fair value of $4.0 million for obligations of U.S. government-sponsored enterprises issued by the Federal National Mortgage Association. | ||||||||||||||||||||||||||||
The maturities of the debt securities and the mortgage-backed securities held to maturity at September 30, 2013 are summarized in the following table: | |||||||||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||||||
Amortized | Fair | ||||||||||||||||||||||||||||
Cost | Value | ||||||||||||||||||||||||||||
Due within 1 year | $ | 11 | $ | 11 | |||||||||||||||||||||||||
Due after 1 but within 5 years | 3,000 | 3,000 | |||||||||||||||||||||||||||
Due after 5 but within 10 years | 1,000 | 921 | |||||||||||||||||||||||||||
Due after 10 years | 3,000 | 2,812 | |||||||||||||||||||||||||||
Total debt securities | 7,011 | 6,744 | |||||||||||||||||||||||||||
Mortgage-backed securities: | |||||||||||||||||||||||||||||
Residential(1) | 44,114 | 43,628 | |||||||||||||||||||||||||||
Commercial(2) | 1,433 | 1,430 | |||||||||||||||||||||||||||
Total | $ | 52,558 | $ | 51,802 | |||||||||||||||||||||||||
-1 | Held-to-maturity mortgage-backed securities – residential include an amortized cost of $9.5 million and a fair value of $9.6 million for obligations of U.S. government agencies issued by the Government National Mortgage Association and obligations of U.S. government-sponsored enterprises issued by Federal National Mortgage Association and Federal Home Loan Mortgage Corporation which had an amortized cost of $33.8 million and a fair value of $33.1 million. Also included are mortgage-backed securities issued by non-U.S. government agencies and government-sponsored enterprises with an amortized cost of $901,000 and a fair value of $917,000. | ||||||||||||||||||||||||||||
-2 | Held-to-maturity mortgage-backed securities – commercial include an amortized cost of $1.4 million and a fair value of $1.4 million for obligations of U.S. government agencies issued by the Small Business Administration. | ||||||||||||||||||||||||||||
There were $4.2 million and $13.9 million in sales of securities from the available-for-sale portfolios during the years ended September 30, 2013 and 2012, respectively. The gross gains on sales of the available-for-sale securities totaled $121,000 and $286,000, respectively. There were no sales from the held-to-maturity portfolio during the years ended September 30, 2013 and 2012. | |||||||||||||||||||||||||||||
As of September 30, 2013 and 2012, securities having an estimated fair value of approximately $9.8 million and $1.7 million, respectively, were pledged to secure public deposits. | |||||||||||||||||||||||||||||
Details of securities with unrealized losses at September 30, 2013 and 2012 are as follows: | |||||||||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||||||
Less Than 12 Months | 12 Months Or Greater | Total | |||||||||||||||||||||||||||
Number of | Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||||||||||
Securities | Value | Losses | Value | Losses | Value | Losses | |||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||
Obligations of U.S. government agencies: | |||||||||||||||||||||||||||||
Mortgage-backed securities - residential | 3 | $ | 1,887 | $ | (57 | ) | $ | 1,099 | $ | (64 | ) | $ | 2,986 | $ | (121 | ) | |||||||||||||
Mortgage-backed securities - commercial | 1 | 1,430 | (3 | ) | — | — | 1,430 | (3 | ) | ||||||||||||||||||||
Obligations of U.S. government-sponsored enterprises | |||||||||||||||||||||||||||||
Mortgage-backed securities - residential | 22 | 30,638 | (1,202 | ) | 626 | (14 | ) | 31,264 | (1,216 | ) | |||||||||||||||||||
Debt securities | 4 | 3,732 | (267 | ) | — | — | 3,732 | (267 | ) | ||||||||||||||||||||
Private label mortgage-backed securities - residential | 2 | 396 | (11 | ) | 21 | (2 | ) | 417 | (13 | ) | |||||||||||||||||||
Corporate securities | 1 | 3,000 | — | — | — | 3,000 | — | ||||||||||||||||||||||
Total | 33 | $ | 41,083 | $ | (1,540 | ) | $ | 1,746 | $ | (80 | ) | $ | 42,829 | $ | (1,620 | ) | |||||||||||||
30-Sep-12 | |||||||||||||||||||||||||||||
Less Than 12 Months | 12 Months Or Greater | Total | |||||||||||||||||||||||||||
Number of | Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||||||||||
Securities | Value | Losses | Value | Losses | Value | Losses | |||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||
Obligations of U.S. government agencies: | |||||||||||||||||||||||||||||
Mortgage-backed securities - residential | 1 | $ | — | $ | — | $ | 1,729 | $ | (8 | ) | $ | 1,729 | $ | (8 | ) | ||||||||||||||
Obligations of U.S. government-sponsored enterprises | |||||||||||||||||||||||||||||
Mortgage-backed securities - residential | 1 | 1,143 | (5 | ) | — | — | 1,143 | (5 | ) | ||||||||||||||||||||
Private label mortgage-backed securities - residential | 3 | — | — | 26 | (1 | ) | 26 | (1 | ) | ||||||||||||||||||||
Corporate securities | 1 | — | — | 2,891 | (109 | ) | 2,891 | (109 | ) | ||||||||||||||||||||
Total | 6 | $ | 1,143 | $ | (5 | ) | $ | 4,646 | $ | (118 | ) | $ | 5,789 | $ | (123 | ) | |||||||||||||
The investment securities listed above currently have fair values less than amortized cost and therefore contain unrealized losses. The Company evaluated these securities and determined that the decline in value was primarily related to fluctuations in the interest rate environment and were not related to any company or industry specific event. | |||||||||||||||||||||||||||||
The Company anticipates full recovery of amortized costs with respect to these securities. The Company does not intend to sell these securities and has determined that it is not more likely than not that the Company would be required to sell these securities prior to maturity or market price recovery. Management has considered factors regarding other than temporarily impaired securities and determined that there are no securities with impairment that is other than temporary as of September 30, 2013 and 2012. | |||||||||||||||||||||||||||||
LOANS_RECEIVABLE_NET
LOANS RECEIVABLE, NET | 12 Months Ended | ||||||||||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||||||||||
Loans Receivable, Net [Abstract] | ' | ||||||||||||||||||||||||||||||||
LOANS RECEIVABLE, NET | ' | ||||||||||||||||||||||||||||||||
NOTE E - LOANS RECEIVABLE, NET | |||||||||||||||||||||||||||||||||
Loans receivable are comprised of the following: | |||||||||||||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
One-to four-family residential | $ | 152,977 | $ | 157,536 | |||||||||||||||||||||||||||||
Commercial real estate | 163,368 | 148,806 | |||||||||||||||||||||||||||||||
Construction | 16,749 | 17,952 | |||||||||||||||||||||||||||||||
Home equity lines of credit | 20,349 | 23,435 | |||||||||||||||||||||||||||||||
Commercial business | 34,492 | 29,930 | |||||||||||||||||||||||||||||||
Other | 11,631 | 11,265 | |||||||||||||||||||||||||||||||
Total loans receivable | 399,566 | 388,924 | |||||||||||||||||||||||||||||||
Net deferred loan costs | 247 | 204 | |||||||||||||||||||||||||||||||
Allowance for loan losses | (3,013 | ) | (3,858 | ) | |||||||||||||||||||||||||||||
Total loans receivable, net | $ | 396,800 | $ | 385,270 | |||||||||||||||||||||||||||||
Certain directors and executive officers of the Company have loans with the Bank. Such loans were made in the ordinary course of business at the Company’s normal credit terms, including interest rate and collateralization, and do not represent more than a normal risk of collection. Total loans receivable from directors and executive officers, and affiliates thereof, were approximately $5.0 million and $5.9 million at September 30, 2013 and 2012, respectively. Total principal additions were approximately $1.3 million and total principal repayments were approximately $2.2 million for the year ended September 30, 2013. | |||||||||||||||||||||||||||||||||
At September 30, 2013 and 2012, the Company was servicing loans for others amounting to approximately $27.0 million and $27.2 million, respectively. The Company held mortgage servicing rights in the amount of $229,000 and $279,000 at September 30, 2013 and 2012, respectively. Servicing loans for others generally consists of collecting mortgage payments, maintaining escrow accounts, disbursing payments to investors, and foreclosure processing. Loan servicing income is recorded on the cash basis and includes servicing fees from investors and certain charges collected from borrowers, such as late payment fees. In connection with loans serviced for others, the Company held borrowers’ escrow balances of approximately $179,000 and $209,000 at September 30, 2013 and 2012, respectively. | |||||||||||||||||||||||||||||||||
The segments of the Bank’s loan portfolio are disaggregated to a level that allows management to monitor risk and performance. The residential mortgage loan segment is further disaggregated into two classes: amortizing term loans, which are primarily first liens, and home equity lines of credit, which are generally second liens. The commercial loan segment is further disaggregated into three classes. Commercial real estate loans include loans secured by multifamily structures, owner-occupied commercial structures, and non-owner occupied nonresidential properties. The construction loan segment consists primarily of developers or investors for the purpose of acquiring, developing and constructing residential or commercial structures and to a lesser extent one-to-four family residential construction loans made to individuals for the acquisition of and/or construction on a lot or lots on which a residential dwelling is to be built. Construction loans to developers and investors have a higher risk profile because the ultimate buyer, once development is completed, is generally not known at the time of the loan. The commercial business loan segment consists of loans made for the purpose of financing the activities of commercial customers and consists primarily of revolving lines of credit. The consumer loan segment consists primarily of stock-secured installment loans, but also includes unsecured personal loans and overdraft lines of credit connected with customer deposit accounts. | |||||||||||||||||||||||||||||||||
Management evaluates individual loans in all segments for possible impairment if the loan either is in nonaccrual status, or is risk rated Substandard and is greater than 90 days past due. Loans are considered to be impaired when, based on current information and events, it is probable that the Company will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. Factors considered by management in evaluating impairment include payment status, collateral value, and the probability of collecting scheduled principal and interest payments when due. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the 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. | |||||||||||||||||||||||||||||||||
Once the determination has been made that a loan is impaired, the recorded investment in the loan is compared to the fair value of the loan using one of three methods: (a) the present value of expected future cash flows discounted at the loan’s effective interest rate; (b) the loan’s observable market price; or (c) the fair value of the collateral securing the loan, less anticipated selling and disposition costs. The method is selected on a loan-by loan basis, with management primarily utilizing the fair value of collateral method. If there is a shortfall between the fair value of the loan and the recorded investment in the loan, the Company charges the difference to the allowance for loan loss as a charge-off and carries the impaired loan on its books at fair value. It is the Company’s policy to evaluate impaired loans on an annual basis to ensure the recorded investment in a loan does not exceed its fair value. | |||||||||||||||||||||||||||||||||
The following tables present impaired loans by class, segregated by those for which a specific allowance was required and those for which a specific allowance was not necessary for the periods presented: | |||||||||||||||||||||||||||||||||
Impaired Loans | |||||||||||||||||||||||||||||||||
Impaired Loans with | with No Specific | ||||||||||||||||||||||||||||||||
Specific Allowance | Allowance | Total Impaired Loans | |||||||||||||||||||||||||||||||
Unpaid | |||||||||||||||||||||||||||||||||
At and for the year ended | Recorded | Related | Recorded | Recorded | Principal | ||||||||||||||||||||||||||||
30-Sep-13 | Investment | Allowance | Investment | Investment | Balance | ||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
One-to four-family residential | $ | 6,192 | $ | 513 | $ | 8,478 | $ | 14,670 | $ | 15,631 | |||||||||||||||||||||||
Commercial real estate | 421 | 7 | 5,599 | 6,020 | 7,179 | ||||||||||||||||||||||||||||
Construction | 600 | 11 | 2,896 | 3,496 | 4,953 | ||||||||||||||||||||||||||||
Home equity lines of credit | — | — | 1,027 | 1,027 | 1,268 | ||||||||||||||||||||||||||||
Commercial business | 11 | 11 | 84 | 95 | 116 | ||||||||||||||||||||||||||||
Other | — | — | — | — | — | ||||||||||||||||||||||||||||
Total impaired loans | $ | 7,224 | $ | 542 | $ | 18,084 | $ | 25,308 | $ | 29,147 | |||||||||||||||||||||||
Impaired Loans | |||||||||||||||||||||||||||||||||
Impaired Loans with | with No Specific | ||||||||||||||||||||||||||||||||
Specific Allowance | Allowance | Total Impaired Loans | |||||||||||||||||||||||||||||||
Unpaid | |||||||||||||||||||||||||||||||||
At and for the year ended | Recorded | Related | Recorded | Recorded | Principal | ||||||||||||||||||||||||||||
30-Sep-12 | Investment | Allowance | Investment | Investment | Balance | ||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
One-to four-family residential | $ | — | $ | — | $ | 7,124 | $ | 7,124 | $ | 7,594 | |||||||||||||||||||||||
Commercial real estate | 3,999 | 798 | 2,425 | 6,424 | 7,204 | ||||||||||||||||||||||||||||
Construction | — | — | 5,141 | 5,141 | 6,927 | ||||||||||||||||||||||||||||
Home equity lines of credit | 1,340 | 122 | 967 | 2,307 | 2,475 | ||||||||||||||||||||||||||||
Commercial business | — | — | 57 | 57 | 57 | ||||||||||||||||||||||||||||
Other | 12 | 12 | — | 12 | 12 | ||||||||||||||||||||||||||||
Total impaired loans | $ | 5,351 | $ | 932 | $ | 15,714 | $ | 21,065 | $ | 24,269 | |||||||||||||||||||||||
The average recorded investment in impaired loans was $22.9 million and $24.0 million for the year ended September 30, 2013 and 2012, respectively. During the year ended September 30, 2013 and 2012, no interest income was recognized while the loans were impaired, and no interest income was recognized using the cash basis method of accounting while these loans were impaired. | |||||||||||||||||||||||||||||||||
The following table presents the classes of the loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the Bank’s internal risk rating system for the period presented: | |||||||||||||||||||||||||||||||||
Special | |||||||||||||||||||||||||||||||||
Pass | Mention | Substandard | Doubtful | Total | |||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||||||||||
One-to four-family residential | $ | 141,881 | $ | 346 | $ | 10,750 | $ | — | $ | 152,977 | |||||||||||||||||||||||
Commercial real estate | 156,511 | 1,128 | 5,729 | — | 163,368 | ||||||||||||||||||||||||||||
Construction | 8,839 | — | 7,910 | — | 16,749 | ||||||||||||||||||||||||||||
Home equity lines of credit | 17,988 | — | 2,361 | — | 20,349 | ||||||||||||||||||||||||||||
Commercial business | 32,905 | 466 | 1,121 | — | 34,492 | ||||||||||||||||||||||||||||
Other | 11,631 | — | — | — | 11,631 | ||||||||||||||||||||||||||||
Total | $ | 369,755 | $ | 1,940 | $ | 27,871 | $ | — | $ | 399,566 | |||||||||||||||||||||||
Special | |||||||||||||||||||||||||||||||||
Pass | Mention | Substandard | Doubtful | Total | |||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
30-Sep-12 | |||||||||||||||||||||||||||||||||
One-to four-family residential | $ | 146,487 | $ | 3,925 | $ | 7,124 | $ | — | $ | 157,536 | |||||||||||||||||||||||
Commercial real estate | 137,616 | 3,063 | 6,448 | 1,679 | 148,806 | ||||||||||||||||||||||||||||
Construction | 8,274 | 4,537 | 5,141 | — | 17,952 | ||||||||||||||||||||||||||||
Home equity lines of credit | 20,295 | 833 | 967 | 1,340 | 23,435 | ||||||||||||||||||||||||||||
Commercial business | 26,057 | 3,151 | 722 | — | 29,930 | ||||||||||||||||||||||||||||
Other | 11,253 | — | 12 | — | 11,265 | ||||||||||||||||||||||||||||
Total | $ | 349,982 | $ | 15,509 | $ | 20,414 | $ | 3,019 | $ | 388,924 | |||||||||||||||||||||||
Management further monitors the performance and credit quality of the loan portfolio by analyzing the age of the portfolio as determined by the length of time a recorded payment is past due. The following table presents the classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans for the period presented: | |||||||||||||||||||||||||||||||||
30-59 | 60-89 | ||||||||||||||||||||||||||||||||
Days | Days | 90 Days + | Total | Non- | Total | ||||||||||||||||||||||||||||
Current | Past Due | Past Due | Past Due | Past Due | Accrual | Loans | |||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||||||||||
One-to four-family residential | $ | 144,084 | $ | — | $ | 378 | $ | 8,515 | $ | 8,893 | $ | 8,515 | $ | 152,977 | |||||||||||||||||||
Commercial real estate | 160,624 | — | — | 2,744 | 2,744 | 2,744 | 163,368 | ||||||||||||||||||||||||||
Construction | 13,223 | — | — | 3,526 | 3,526 | 3,526 | 16,749 | ||||||||||||||||||||||||||
Home equity lines of credit | 19,253 | 250 | — | 846 | 1,096 | 846 | 20,349 | ||||||||||||||||||||||||||
Commercial business | 34,467 | — | — | 25 | 25 | 25 | 34,492 | ||||||||||||||||||||||||||
Other | 11,631 | — | — | — | — | — | 11,631 | ||||||||||||||||||||||||||
Total | $ | 383,282 | $ | 250 | $ | 378 | $ | 15,656 | $ | 16,284 | $ | 15,656 | $ | 399,566 | |||||||||||||||||||
30-59 | 60-89 | ||||||||||||||||||||||||||||||||
Days | Days | 90 Days + | Total | Non- | Total | ||||||||||||||||||||||||||||
Current | Past Due | Past Due | Past Due | Past Due | Accrual | Loans | |||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
30-Sep-12 | |||||||||||||||||||||||||||||||||
One-to four-family residential | $ | 147,749 | $ | 621 | $ | 1,589 | $ | 7,577 | $ | 9,787 | $ | 7,577 | $ | 157,536 | |||||||||||||||||||
Commercial real estate | 141,674 | — | 708 | 6,424 | 7,132 | 6,424 | 148,806 | ||||||||||||||||||||||||||
Construction | 12,811 | — | — | 5,141 | 5,141 | 5,141 | 17,952 | ||||||||||||||||||||||||||
Home equity lines of credit | 22,353 | 160 | 59 | 863 | 1,082 | 863 | 23,435 | ||||||||||||||||||||||||||
Commercial business | 29,761 | 10 | 102 | 57 | 169 | 57 | 29,930 | ||||||||||||||||||||||||||
Other | 11,253 | — | — | 12 | 12 | 12 | 11,265 | ||||||||||||||||||||||||||
Total | $ | 365,601 | $ | 791 | $ | 2,458 | $ | 20,074 | $ | 23,323 | $ | 20,074 | $ | 388,924 | |||||||||||||||||||
The amount of interest income not recognized on non-accrual loans was approximately $763,000 and $2.1 million for the years ended September 30, 2013 and 2012, respectively. At September 30, 2013 and September 30, 2012, there were no commitments to lend additional funds to borrowers whose loans are classified as non-accrual. | |||||||||||||||||||||||||||||||||
An allowance for loan losses (“ALL”) is maintained to absorb losses from the loan portfolio. The ALL is based on management’s continuing evaluation of the risk characteristics and credit quality of the loan portfolio, assessment of current economic conditions, diversification and size of the portfolio, adequacy of collateral, past and anticipated loss experience, and the amount of NPLs. | |||||||||||||||||||||||||||||||||
The Bank’s methodology for determining the ALL is based on the requirements of ASC Section 310-10-35 for loans individually evaluated for impairment (discussed above) and ASC Subtopic 450-20 for loans collectively evaluated for impairment, as well as the Interagency Policy Statements on the Allowance for Loan and Lease Losses and other bank regulatory guidance. | |||||||||||||||||||||||||||||||||
Loans that are collectively evaluated for impairment are analyzed with general allowances being made as appropriate. For general allowances, historical loss trends are used in the estimation of losses in the current portfolio. These historical loss amounts are modified by other qualitative and economic factors. | |||||||||||||||||||||||||||||||||
The loans are segmented into classes based on their inherent varying degrees of risk, as described above. Management tracks the historical net charge-off activity by segment and utilizes this figure, as a percentage of the segment, as the general reserve percentage for pooled, homogenous loans that have not been deemed impaired. Typically, an average of losses incurred over 5 historical years is used. | |||||||||||||||||||||||||||||||||
Non-impaired credits are segregated for the application of qualitative factors. Management has identified a number of additional qualitative factors which it uses to supplement the historical charge-off factor because these factors are likely to cause estimated credit losses associated with the existing loan pools to differ from historical loss experience. The additional factors that are evaluated quarterly and updated using information obtained from internal, regulatory, and governmental sources are: national and local economic trends and conditions; levels of and trends in delinquency rates and non-accrual loans; trends in volumes and terms of loans; effects of changes in lending policies; experience, ability, and depth of lending staff; value of underlying collateral; and concentrations of credit from a loan type, industry and/or geographic standpoint. | |||||||||||||||||||||||||||||||||
Management reviews the loan portfolio on a quarterly basis using a defined, consistently applied process in order to make appropriate and timely adjustments to the ALL. When information confirms all or part of specific loans to be uncollectible, these amounts are promptly charged off against the ALL. Since loans individually evaluated for impairment are promptly written down to their fair value, typically there is no portion of the ALL for loans individually evaluated for impairment. | |||||||||||||||||||||||||||||||||
The following tables summarize the activity in the allowance for loan losses by loan category for the years ended September 30, 2013 and 2012: | |||||||||||||||||||||||||||||||||
One-to Four- | Home Equity | ||||||||||||||||||||||||||||||||
Family | Commercial | Lines of | Commercial | ||||||||||||||||||||||||||||||
Residential | Real Estate | Construction | Credit | Business | Other | Unallocated | Total | ||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
Balance - September 30, 2012 | $ | 610 | $ | 1,929 | $ | 640 | $ | 232 | $ | 383 | $ | 23 | $ | 41 | $ | 3,858 | |||||||||||||||||
Charge-offs | (478 | ) | (576 | ) | (1,374 | ) | (13 | ) | (806 | ) | (13 | ) | — | (3,260 | ) | ||||||||||||||||||
Recoveries | — | 20 | 284 | — | — | — | — | 304 | |||||||||||||||||||||||||
Provision | 712 | (521 | ) | 1,054 | (95 | ) | 875 | (1 | ) | 86 | 2,111 | ||||||||||||||||||||||
Balance-September 30, 2013 | $ | 844 | $ | 852 | $ | 604 | $ | 125 | $ | 452 | $ | 9 | $ | 127 | $ | 3,013 | |||||||||||||||||
One-to Four- | Home Equity | ||||||||||||||||||||||||||||||||
Family | Commercial | Lines of | Commercial | ||||||||||||||||||||||||||||||
Residential | Real Estate | Construction | Credit | Business | Other | Unallocated | Total | ||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
Balance- September 30, 2011 | $ | 734 | $ | 1,266 | $ | 1,043 | $ | 101 | $ | 551 | $ | 13 | $ | 104 | $ | 3,812 | |||||||||||||||||
Charge-offs | (326 | ) | (110 | ) | (880 | ) | (81 | ) | (69 | ) | — | — | (1,466 | ) | |||||||||||||||||||
Recoveries | — | — | 51 | — | — | — | — | 51 | |||||||||||||||||||||||||
Provision | 202 | 773 | 426 | 212 | (99 | ) | 10 | (63 | ) | 1,461 | |||||||||||||||||||||||
Balance - September 30, 2012 | $ | 610 | $ | 1,929 | $ | 640 | $ | 232 | $ | 383 | $ | 23 | $ | 41 | $ | 3,858 | |||||||||||||||||
The following tables summarize the ALL by loan category, segregated into the amount required for loans individually evaluated for impairment and the amount required for loans collectively evaluated for impairment as of September 30, 2013 and September 30, 2012: | |||||||||||||||||||||||||||||||||
One-to Four- | Home Equity | ||||||||||||||||||||||||||||||||
Family | Commercial | Lines of | Commercial | ||||||||||||||||||||||||||||||
Residential | Real Estate | Construction | Credit | Business | Other | Unallocated | Total | ||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
Allowance for Loan Losses: | |||||||||||||||||||||||||||||||||
Balance - September 30, 2013 | $ | 844 | $ | 852 | $ | 604 | $ | 125 | $ | 452 | $ | 9 | $ | 127 | $ | 3,013 | |||||||||||||||||
Individually evaluated | |||||||||||||||||||||||||||||||||
for impairment | 513 | 7 | 11 | — | 11 | — | — | 542 | |||||||||||||||||||||||||
Collectively evaluated | |||||||||||||||||||||||||||||||||
for impairment | 331 | 845 | 593 | 125 | 441 | 9 | 127 | 2,471 | |||||||||||||||||||||||||
Loans receivable: | |||||||||||||||||||||||||||||||||
Balance - September 30, 2013 | $ | 152,977 | $ | 163,368 | $ | 16,749 | $ | 20,349 | $ | 34,492 | $ | 11,631 | $ | 399,566 | |||||||||||||||||||
Individually evaluated | |||||||||||||||||||||||||||||||||
for impairment | 14,670 | 6,020 | 3,496 | 1,027 | 95 | — | 25,308 | ||||||||||||||||||||||||||
Collectively evaluated | |||||||||||||||||||||||||||||||||
for impairment | 138,307 | 157,348 | 13,253 | 19,322 | 34,397 | 11,631 | 374,258 | ||||||||||||||||||||||||||
One-to Four- | Home Equity | ||||||||||||||||||||||||||||||||
Family | Commercial | Lines of | Commercial | ||||||||||||||||||||||||||||||
Residential | Real Estate | Construction | Credit | Business | Other | Unallocated | Total | ||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
Allowance for Loan Losses: | |||||||||||||||||||||||||||||||||
Balance- September 30, 2012 | $ | 610 | $ | 1,929 | $ | 640 | $ | 232 | $ | 383 | $ | 23 | $ | 41 | $ | 3,858 | |||||||||||||||||
Individually evaluated | |||||||||||||||||||||||||||||||||
for impairment | — | 798 | — | 122 | — | 12 | — | 932 | |||||||||||||||||||||||||
Collectively evaluated | |||||||||||||||||||||||||||||||||
for impairment | 610 | 1,131 | 640 | 110 | 383 | 11 | 41 | 2,926 | |||||||||||||||||||||||||
Loans receivable: | |||||||||||||||||||||||||||||||||
Balance - September 30, 2012 | $ | 157,536 | $ | 148,806 | $ | 17,952 | $ | 23,435 | $ | 29,930 | $ | 11,265 | $ | 388,924 | |||||||||||||||||||
Individually evaluated | |||||||||||||||||||||||||||||||||
for impairment | 7,124 | 6,424 | 5,141 | 2,307 | 57 | 12 | 21,065 | ||||||||||||||||||||||||||
Collectively evaluated | |||||||||||||||||||||||||||||||||
for impairment | 150,412 | 142,382 | 12,811 | 21,128 | 29,873 | 11,253 | 367,859 | ||||||||||||||||||||||||||
The allowance for loan losses is based on estimates, and actual losses will vary from current estimates. Management believes that the segmentation of the loan portfolio into homogeneous pools and the related historical loss ratios and other qualitative factors, as well as the consistency in the application of assumptions, result in an ALL that is representative of the risk found in the components of the portfolio at any given date. | |||||||||||||||||||||||||||||||||
The Bank has adopted FASB issue ASU No. 2011-02 on the determination of whether a loan restructuring is considered to be a Troubled Debt Restructuring (“TDR”). A TDR is a loan that has been modified whereby the Bank has agreed to make certain concessions to a borrower to meet the needs of both the borrower and the Bank to maximize the ultimate recovery of a loan. TDR occurs when a borrower is experiencing, or is expected to experience, financial difficulties and the loan is modified using a modification that would otherwise not be granted to the borrower. The types of concessions granted generally included, but are not limited to interest rate reductions, limitations on the accrued interest charged, term extensions, and deferment of principal. | |||||||||||||||||||||||||||||||||
There were eight TDRs during the year ended September 30, 2013. These were classified as TDRs due to financial difficulty of the borrowers and lower than market interest rates. The following table summarizes the TDRs during the twelve month period ended September 30, 2013 and 2012: | |||||||||||||||||||||||||||||||||
Year Ended September 30, 2013 | |||||||||||||||||||||||||||||||||
Number of | Investment Before | Investment After | |||||||||||||||||||||||||||||||
Loans | TDR Modification | TDR Modification | |||||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
One-to four-family residential | 7 | $ | 1,170 | $ | 1,168 | ||||||||||||||||||||||||||||
Commercial real estate | 1 | 693 | 995 | ||||||||||||||||||||||||||||||
Construction | — | — | — | ||||||||||||||||||||||||||||||
Home equity lines of credit | — | — | — | ||||||||||||||||||||||||||||||
Commercial business | — | — | — | ||||||||||||||||||||||||||||||
Other | — | — | — | ||||||||||||||||||||||||||||||
Total | 8 | $ | 1,863 | $ | 2,163 | ||||||||||||||||||||||||||||
Year Ended September 30, 2012 | |||||||||||||||||||||||||||||||||
Number of | Investment Before | Investment After | |||||||||||||||||||||||||||||||
Loans | TDR Modification | TDR Modification | |||||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
One-to four-family residential | 6 | $ | 2,336 | $ | 2,336 | ||||||||||||||||||||||||||||
Commercial real estate | 4 | 3,269 | 2,325 | ||||||||||||||||||||||||||||||
Construction | — | — | — | ||||||||||||||||||||||||||||||
Home equity lines of credit | — | — | — | ||||||||||||||||||||||||||||||
Commercial business | — | — | — | ||||||||||||||||||||||||||||||
Other | — | — | — | ||||||||||||||||||||||||||||||
Total | 10 | $ | 5,605 | $ | 4,661 | ||||||||||||||||||||||||||||
A default on a TDR loan for purposes of this disclosure occurs when a borrower is 90 days past due or a foreclosure or repossession of the applicable collateral has occurred. During the year ended September 30, 2013, no defaults occurred on troubled debt restructured loans that were modified as a TDR within the previous 12 months. | |||||||||||||||||||||||||||||||||
The Company has interest-only mortgage loans with principal balances of $16.9 million and $17.4 million at September 30, 2013 and 2012, respectively. The average interest-only term on these loans is 10 years at which time these loans reset to fully amortize over 20 years, on average. As these loans are collateralized by residential real estate with an average original loan-to-value of 71.1%, management does not anticipate any losses on these loans as of September 30, 2013. | |||||||||||||||||||||||||||||||||
Total loans pledged as collateral against Federal Home Loan Bank of New York borrowings was $97.8 million and $86.3 million as of September 30, 2013 and 2012, respectively. |
ACCRUED_INTEREST_RECEIVABLE
ACCRUED INTEREST RECEIVABLE | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Notes to Financial Statements | ' | ||||||||
ACCRUED INTEREST RECEIVABLE | ' | ||||||||
NOTE F - ACCRUED INTEREST RECEIVABLE | |||||||||
The following is a summary of accrued interest receivable: | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
(Dollars in thousands) | |||||||||
Loans | $ | 1,563 | $ | 1,686 | |||||
Investment securities | 51 | 91 | |||||||
Mortgage-backed securities | 138 | 117 | |||||||
Total accrued interest receivable | $ | 1,752 | $ | 1,894 | |||||
PREMISES_AND_EQUIPMENT
PREMISES AND EQUIPMENT | 12 Months Ended | ||||||||||
Sep. 30, 2013 | |||||||||||
Property, Plant and Equipment [Abstract] | ' | ||||||||||
PREMISES AND EQUIPMENT | ' | ||||||||||
NOTE G - PREMISES AND EQUIPMENT | |||||||||||
Premises and equipment consist of the following: | |||||||||||
Estimated | September 30, | ||||||||||
Useful Lives | 2013 | 2012 | |||||||||
(Dollars in thousands) | |||||||||||
Land | Indefinite | $ | 5,330 | $ | 5,330 | ||||||
Buildings and improvements | 10-40 years | 21,382 | 21,811 | ||||||||
Furniture, fixtures and equipment | 5-10 years | 2,673 | 2,512 | ||||||||
29,385 | 29,653 | ||||||||||
Less accumulated depreciation and amortization | (8,505 | ) | (8,112 | ) | |||||||
$ | 20,880 | $ | 21,541 | ||||||||
For the years ended September 30, 2013 and 2012, depreciation expense included in occupancy expense amounted to approximately $927,000 and $935,000, respectively. | |||||||||||
Hungaria Urban Renewal, LLC was formed in 2002 and its sole purpose was to purchase the land and construct the office building for which the Company is the primary tenant. During the period of construction, the Company had leased the land and building from the entity. The lease payments were structured to equal the debt service on the loans plus a nominal fee. The lease agreement contained an irrevocable purchase option allowing the Company to purchase the land and building from this entity for the aggregated outstanding indebtedness. The Company owns a 100% interest in Hungaria Urban Renewal, LLC, which has no other business other than owning the Bank’s main office site. At September 30, 2013, Hungaria Urban Renewal, LLC accounted for approximately $3.1 million, $11.0 million, and $209,000 of land, building, and furniture, fixtures and equipment, net of depreciation, respectively. At September 30, 2012, Hungaria Urban Renewal, LLC accounted for approximately $3.1 million, $11.4 million, and $314,000 of land, building, and furniture, fixtures and equipment, net of depreciation, respectively. |
OTHER_REAL_ESTATE_OWNED
OTHER REAL ESTATE OWNED | 12 Months Ended |
Sep. 30, 2013 | |
Banking and Thrift [Abstract] | ' |
OTHER REAL ESTATE OWNED | ' |
NOTE H - OTHER REAL ESTATE OWNED | |
The Company held $14.8 million of real estate owned properties at September 30, 2013 and $13.4 million at September 30, 2012. The Company incurred write-downs totaling $42,000 and $148,000 on these properties for the year ended September 30, 2013 and 2012; these amounts were carried as valuation allowances at September 30, 2013 and 2012, respectively. Further declines in real estate values may result in increased foreclosed real estate expense in the future. Routine holding costs are charged to expense as incurred and improvements to real estate owned that enhance the value of the real estate are capitalized. |
DEPOSITS
DEPOSITS | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Deposits [Abstract] | ' | ||||||||
DEPOSITS | ' | ||||||||
NOTE I - DEPOSITS | |||||||||
A summary of deposits by type of account follows: | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
(Dollars in thousands) | |||||||||
Demand accounts | $ | 98,345 | $ | 50,897 | |||||
Savings accounts | 53,291 | 55,293 | |||||||
NOW accounts | 40,500 | 44,312 | |||||||
Money market accounts | 107,351 | 107,555 | |||||||
Certificate of deposit | 125,696 | 129,716 | |||||||
Retirement accounts | 28,145 | 28,745 | |||||||
$ | 453,328 | $ | 416,518 | ||||||
The aggregate amount of deposit accounts with a minimum denomination of $100,000 was approximately $296.0 million and $238.3 million at September 30, 2013 and 2012, respectively. The aggregate amount of certificate deposits with balance of $100,000 or more was $82.6 million at both September 30, 2013 and 2012. | |||||||||
At September 30, 2013, certificates of deposit (including retirement accounts) have contractual maturities as follows (in thousands): | |||||||||
Year Ending September 30, | |||||||||
2014 | $ | 96,684 | |||||||
2015 | 27,727 | ||||||||
2016 | 14,225 | ||||||||
2017 | 7,856 | ||||||||
2018 | 11,606 | ||||||||
Thereafter | 649 | ||||||||
$ | 158,747 |
BORROWINGS
BORROWINGS | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Debt Disclosure [Abstract] | ' | ||||||||
BORROWINGS | ' | ||||||||
NOTE J - BORROWINGS | |||||||||
1. Federal Home Loan Bank of New York Advances | |||||||||
Long term Federal Home Loan Bank of New York (FHLBNY) advances at September 30, 2013 and September 30, 2012 totaled approximately $27.1 million and $36.5 million, respectively. The weighted average interest rate on advances outstanding at September 30, 2013 was 3.21%. The advances were collateralized by unencumbered qualified assets consisting of one-to-four family residential mortgage loans and investment securities. Advances are made pursuant to several different credit programs offered from time to time by the FHLBNY. | |||||||||
Long term FHLBNY advances as of September 30, 2013 mature as follows (in thousands): | |||||||||
Year Ending September 30, | |||||||||
2014 | $ | 8,700 | |||||||
2015 | 5,000 | ||||||||
2016 | 2,260 | ||||||||
2017 | 3,000 | ||||||||
2018 | 4,000 | ||||||||
Thereafter | 4,140 | ||||||||
$ | 27,100 | ||||||||
Additionally, the Company has established an Overnight Line of Credit arrangement with the FHLBNY. The total amount available under the line of credit is based on the amount of eligible collateral pledged to the FHLBNY. At September 30, 2013 and 2012, the Company had available credit from the FHLBNY totaling $61.3 million and $43.6 million, respectively. Information concerning short-term arrangements with the FHLBNY is summarized as follows: | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
(Dollars in thousands) | |||||||||
Balance at end of year | $ | — | $ | 1,400 | |||||
Weighted average balance during the year | $ | 2,721 | $ | 911 | |||||
Maximum month-end balance during the year | $ | 15,500 | $ | 8,750 | |||||
Average interest rate during the year | 0.39% | 0.38% | |||||||
2. Securities Sold Under Reverse Repurchase Agreements | |||||||||
Qualifying repurchase agreements are treated as financings and are reflected as a liability in the consolidated balance sheet. The Company had repurchase agreements of $5.0 million at September 30, 2013 and 2012. The $5.0 million outstanding at September 30, 2013, is at an interest rate of 3.83% maturing in December 2014. These agreements are collateralized by securities underlying the agreements and are held in safekeeping with the transaction’s counter-party. At September 30, 2013, the fair value of the FHLB obligation and mortgage-backed investment security collateral for these agreements totaled approximately $5.8 million. |
SERVICING_POLICY
SERVICING POLICY | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Transfers and Servicing [Abstract] | ' | ||||||||
SERVICING POLICY | ' | ||||||||
NOTE K – SERVICING POLICY | |||||||||
The Company originates and sells loans receivable secured by one-to-four family residential properties and commercial business loans guaranteed by the SBA. The Company has sold loans on a servicing retained basis and on a servicing released basis. Loans sold with servicing released and servicing retained during the year ended September 30, 2013 were $0 and $4.9 million, respectively. Loans sold with servicing released and servicing retained during the year ended September 30, 2012 were $0 and $9.2 million, respectively. The Company accounts for sales in accordance with ASC 860, Transfers and Servicing. Upon sale, the receivables are removed from the balance sheet, mortgage servicing rights are recorded as an asset for servicing rights retained, and a gain on sale, if applicable, is recognized for the difference between the carrying value of the receivables and the sales proceeds, net of origination costs. | |||||||||
Gains on sales of loans, representing the difference between the total sales price received for the loans and the allocated cost of the loans, are recognized when mortgage loans are sold and delivered to the purchasers. Loans have been sold on a servicing released basis and servicing retained basis. Loans are accounted for as sold when control of the mortgage is surrendered. Control over the mortgage loans is deemed surrendered when (1) the mortgage loans have been isolated from the Company, (2) the buyer has the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the mortgage loans and (3) the Company does not maintain effective control over the mortgage loans through either (a) an agreement that entitles and obligates the Company to repurchase or redeem the mortgage loans before maturity, or (b) the ability to unilaterally cause the buyer to return specific mortgage loans. | |||||||||
The Company services one-to-four family residential mortgage loans for investors in the secondary mortgage market, which are not included in the balance sheet. The Company’s fee is a percentage of the principal balance and is recognized as income when received. At September 30, 2013 and 2012, we were servicing such sold loans in the amount of $18.2 million and $20.8 million, respectively. Loan servicing includes collecting and remitting loan payments, accounting for principal and interest, contacting delinquent mortgagors, supervising foreclosures and property dispositions in the event of unremedied defaults, making certain insurance and tax payments on behalf of the borrowers and generally administering the loans. Mortgage servicing rights are amortized in proportion to, and over the period of, estimated net servicing revenues and are included in other assets on the consolidated balance sheet. Activity in mortgage servicing rights during the years ended September 30, 2013 and 2012 are summarized as follows: | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
(Dollars in thousands) | |||||||||
Beginning balance | $ | 279 | $ | 235 | |||||
Origination of mortgage servicing rights | 20 | 141 | |||||||
Amortization | (70 | ) | (97 | ) | |||||
Ending balance | $ | 229 | $ | 279 | |||||
Mortgage servicing rights are carried at the lower of amortized cost or fair value. Fair values are estimated using discounted cash flows based on a current market interest rate. | |||||||||
The Company also services the SBA guaranteed portion of commercial business loans sold to investors in the secondary market, which are not included in the balance sheet. The Company’s fee is a percentage of the principal balance and is recognized as income when received. At September 30, 2013 and 2012, we were servicing SBA loans sold in the amount of $8.8 million and $6.3 million, respectively. Loan servicing includes collecting and remitting loan payments, accounting for principal and interest, contacting delinquent mortgagors, supervising foreclosures and property dispositions in the event of unremedied defaults, making certain insurance and tax payments on behalf of the borrowers and generally administering the loans. |
INCOME_TAXES
INCOME TAXES | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Income Taxes | ' | ||||||||
INCOME TAXES | ' | ||||||||
NOTE L - INCOME TAXES | |||||||||
The income tax expense is comprised of the following components for the years ended September 30, 2013 and 2012: | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
(Dollars in thousands) | |||||||||
Current | $ | (63 | ) | $ | 20 | ||||
Deferred | 84 | 101 | |||||||
Total income tax expense | $ | 21 | $ | 121 | |||||
A reconciliation of income tax at the statutory tax rate to the effective income tax expense for the years ended September 30, 2013 and 2012 is as follows: | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
(Dollars in thousands) | |||||||||
Income tax expense (benefit) at statutory rate | $ | 97 | $ | 214 | |||||
Increase (decrease) resulting from: | |||||||||
State income taxes, net of federal income tax benefit | 5 | 34 | |||||||
Tax-exempt income, net | (108 | ) | (112 | ) | |||||
Nondeductible expenses | 3 | 4 | |||||||
Share based compensation | — | 14 | |||||||
Employee stock ownership plan | (25 | ) | (32 | ) | |||||
Increase (decrease) in valuation allowance | 49 | (26 | ) | ||||||
Other, net | — | 25 | |||||||
Total income tax expense | $ | 21 | $ | 121 | |||||
The major sources of temporary differences and their deferred tax effect at September 30, 2013 and 2012 are as follows: | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
(Dollars in thousands) | |||||||||
Allowance for loan losses | $ | 1,203 | $ | 1,541 | |||||
Deferred loan fees | 1,067 | 1,016 | |||||||
Employee benefits | 295 | 299 | |||||||
Charitable contributions | 18 | 13 | |||||||
Net operating losses | 1,912 | 1,727 | |||||||
Alternative minimum tax credit | 176 | 247 | |||||||
Unrealized loss, minimum pension liability | 348 | 627 | |||||||
Net unrealized losses, investment securities available-for-sale | 67 | — | |||||||
OREO | 297 | 319 | |||||||
Straight line rent | 118 | 93 | |||||||
Gross deferred tax asset | 5,501 | 5,882 | |||||||
Depreciation | (1,469 | ) | (1,573 | ) | |||||
Discount accretion on investments | (95 | ) | (107 | ) | |||||
Net unrealized gains, investment securities available-for-sale | — | (178 | ) | ||||||
Unrealized gain, derivative contracts | — | (22 | ) | ||||||
Mortgage servicing rights | (92 | ) | (111 | ) | |||||
Gross deferred tax liability | (1,656 | ) | (1,991 | ) | |||||
Net deferred tax asset | 3,845 | 3,891 | |||||||
Valuation allowance | (183 | ) | (134 | ) | |||||
Net deferred tax asset, included in other assets | $ | 3,662 | $ | 3,757 | |||||
In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which temporary differences are deductible and carry forwards are available. Due to the uncertainty of the Company's ability to realize the benefit of certain deferred tax assets within statutory time limits, the net deferred tax assets are partially offset by a valuation allowance at September 30, 2013 and 2012. | |||||||||
The net change in the valuation allowance for the year ended September 30, 2013 was an increase of approximately $49,000. This change was based upon management’s assessment of current and projected future operations. Management determined that a deferred tax valuation allowance was necessary on $183,000 of state net operating loss carry forwards. The Company has considered future market growth, forecasted earnings, future taxable income, feasible and permissible tax planning strategies in determining the realizability of deferred tax assets. If the Company was to determine that it would not be able to realize a portion of its net deferred tax asset in the future for which there is currently no valuation allowance, an adjustment to the net deferred tax asset would be charged to earnings in the period such determination was made. Conversely, if the Company was to make a determination that it is more likely than not that the deferred tax assets for which there is a valuation allowance would be realized, the related valuation allowance would be reduced and a benefit to earnings would be recorded. | |||||||||
At September 30, 2013 the Company had approximately $4.2 million of federal and $8.3 million of state net operating loss carry forwards available to offset future taxable income for tax reporting purposes. The Federal net operating loss carry forward will begin to expire in 2029. The state net operating loss carry forward will begin to expire in 2015, if not utilized. At September 30, 2013, there was no valuation allowance against the Federal net operating loss carry forward and an $183,000 valuation allowance against the state net operating loss carry forward. In determining whether or not a valuation allowance was necessary for its federal and state net operating losses, the Company considered forecasted earnings, future taxable income, and tax planning strategies limited to the twelve months following September 30, 2013. | |||||||||
Prior to 1996, savings banks that met certain definitions, tests and other conditions prescribed by the Internal Revenue Code were allowed to deduct, with limitations, a bad debt deduction computed as a percentage of taxable income before such deduction. Currently, the Company employs the direct charge-off method to account for bad debt. The company was required to switch from the reserve method because it now qualifies as a Large Bank as defined under Code Section 585, and is precluded from further using the reserve method. | |||||||||
The Company is not required to provide a deferred tax liability for its tax loss reserve as of December 31, 1987 (the Base Year). The amount of this reserve on which no deferred taxes have been provided is approximately $1,258,000. This reserve could be recognized as taxable income and create a current and/or deferred tax liability using the income tax rates then in effect if one of the following occur: (1) the Company’s retained earnings represented by this reserve is used for purposes other than to absorb losses from bad debts, including dividends or distributions in liquidation, (2) the Company fails to meet the definitions, tests, or other conditions provided by the Internal Revenue Code for a qualified savings and loan association, or (3) there is a change in the Federal tax law. Deferred tax liabilities have been recorded for tax loss reserves in excess of book reserves recorded after the Base Year. | |||||||||
PENSION_PLAN
PENSION PLAN | 12 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Compensation and Retirement Disclosure [Abstract] | ' | ||||||||||||||||
PENSION PLAN | ' | ||||||||||||||||
NOTE M - PENSION PLAN | |||||||||||||||||
On January 26, 2006, the Company’s defined-benefit pension plan was frozen and amended to eliminate future benefit accruals after February 15, 2006. | |||||||||||||||||
The Company had a noncontributory defined benefit pension plan covering all eligible employees. Plan assets are invested in six diversified investment funds of the Pentegra Retirement Trust (the Trust), a no load series open-ended mutual fund. The Trust has been given discretion by the Plan Sponsor to determine the appropriate strategic asset allocation versus plan liabilities, as governed by the Trust’s Statement of Investment Objectives and Guidelines (the Guidelines). | |||||||||||||||||
The long-term investment objective is to be invested 65% in equity securities (equity mutual funds) and 35% in debt securities (bond mutual funds). If the plan is underfunded under the Guidelines, the bond fund portion will be temporarily increased to 50% in order to lessen asset value volatility. When the plan is no longer underfunded, the bond fund portion will be decreased back to 35%. Asset rebalancing is performed at least annually, with interim adjustments made when the investment mix varies more than 5% from the target (i.e., a 10% target range). Risk/volatility is further managed by the distinct investment objectives of each of the Trust funds and the diversification within each fund. | |||||||||||||||||
The following table sets forth the plan’s funded status and amounts recognized in the Company’s consolidated balance sheet at September 30, 2013 and September 30, 2012. | |||||||||||||||||
At September 30, | |||||||||||||||||
2013 | 2012 | ||||||||||||||||
(Dollars in thousands) | |||||||||||||||||
Actuarial present value of benefit obligations | $ | 3,630 | $ | 4,156 | |||||||||||||
Change in benefit obligations | |||||||||||||||||
Projected benefit obligation, beginning | $ | 4,156 | $ | 3,719 | |||||||||||||
Interest cost | 162 | 172 | |||||||||||||||
Actuarial (gain) loss | (507 | ) | 438 | ||||||||||||||
Annuity payments and lump sum distributions | (181 | ) | (173 | ) | |||||||||||||
Projected benefit obligation, end | $ | 3,630 | $ | 4,156 | |||||||||||||
Change in plan assets | |||||||||||||||||
Fair value of assets, beginning | $ | 2,487 | $ | 2,196 | |||||||||||||
Actual return on plan assets | 252 | 296 | |||||||||||||||
Employer contributions | 172 | 168 | |||||||||||||||
Annuity payments and lump sum distributions | (181 | ) | (173 | ) | |||||||||||||
Fair value of assets, end | $ | 2,730 | $ | 2,487 | |||||||||||||
Funded status included with other liabilities | $ | (900 | ) | $ | (1,669 | ) | |||||||||||
Net pension cost for the years ended September 30, 2013 and 2012 included the following components: | |||||||||||||||||
September 30, | |||||||||||||||||
2013 | 2012 | ||||||||||||||||
(Dollars in thousands) | |||||||||||||||||
Service cost benefits earned during the year | $ | — | $ | — | |||||||||||||
Interest cost on projected benefit obligation | 162 | 172 | |||||||||||||||
Expected return on plan assets | (186 | ) | (161 | ) | |||||||||||||
Amortization of unrecognized net loss | 124 | 81 | |||||||||||||||
Net Pension Cost | $ | 100 | $ | 92 | |||||||||||||
For the year ended September 30, 2013, the weighted average discount rate used in determining the actuarial present value of the projected benefit obligation was 5.00%. For the year ended September 30, 2012, the weighted average discount rate used in determining the actuarial present value of the projected benefit obligation was 4.00%. | |||||||||||||||||
The long-term rate-of-return-on-assets assumption was set based on historical returns earned by equities and fixed income securities, adjusted to reflect expectations of future returns as applied to the plan’s target allocation of asset classes. Equities and fixed income securities were assumed to earn rates of return in the ranges of 7-11% and 2-6% for the year ended September 30, 2013, respectively. When these overall return expectations are applied to the plan’s target allocation, the result is an expected rate of return of 6.0% to 10.0%. Accordingly, the expected long-term rate of return on assets was 7.50% for 2013 and 2012. | |||||||||||||||||
Current Asset Allocation | |||||||||||||||||
The Company’s pension plan weighted-average asset allocations at September 30, 2013 and 2012, by asset category are as follows: | |||||||||||||||||
September 30, | |||||||||||||||||
2013 | 2012 | ||||||||||||||||
Equity securities | 62% | 58% | |||||||||||||||
Debt securities (Bond Mutual Funds) | 37% | 42% | |||||||||||||||
Other (Money Market Fund) | 1% | 0% | |||||||||||||||
Total | 100% | 100% | |||||||||||||||
The target asset allocation set for the assets of the plan are in equity securities ranging from 40 percent to 70 percent and in debt securities ranging from 30 percent to 60 percent. In general, the plan assets are investment securities that are well-diversified in terms of industry, capitalization and asset class. The plan assets are mostly a mix of U.S. Treasury security indexed funds, mutual funds indexed to the performance of Fortune 500 U.S. companies, debt securities held in bond funds, domestic and foreign common equity funds, and a money market fund. The plan’s exposure to a concentration of credit risk is limited by the diversification of the investments into various investment options with multiple asset managers. | |||||||||||||||||
Expected Contributions | |||||||||||||||||
For the fiscal year ending September 30, 2014, the Company expects to contribute $111,000 to the Plan. | |||||||||||||||||
Estimated Future Benefit Payments | |||||||||||||||||
The following benefit payments are expected to be paid as follows (in thousands): | |||||||||||||||||
October 1, 2013 through September 30, 2014 | $ | 194 | |||||||||||||||
October 1, 2014 through September 30, 2015 | 197 | ||||||||||||||||
October 1, 2015 through September 30, 2016 | 197 | ||||||||||||||||
October 1, 2016 through September 30, 2017 | 198 | ||||||||||||||||
October 1, 2017 through September 30, 2018 | 198 | ||||||||||||||||
October 1, 2018 through September 30, 2023 | 998 | ||||||||||||||||
$ | 1,982 | ||||||||||||||||
Included in the funded status of the pension plan at September 30, 2013 and 2012, are actuarial losses of $872,000 and $1,570,000, respectively. These amounts are included, net of related income tax effects of $348,000 and $627,000, respectively, in the accumulated other comprehensive loss component of stockholders’ equity. During the year ending September 30, 2014, approximately $54,000 of the actuarial losses is expected to be amortized into net periodic pension expense. | |||||||||||||||||
The following table presents the plan assets that are measured at fair value on a recurring basis by level within the fair value hierarchy under ASC Topic 820. Financial assets are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. See Note R for further detail regarding fair value hierarchy. | |||||||||||||||||
Fair Value Measurements at Reporting Date Using: | |||||||||||||||||
Quoted Prices | Significant | ||||||||||||||||
At | in Active Markets | Other | Significant | ||||||||||||||
September 30, | for Identical | Observable | Unobservable | ||||||||||||||
2013 | Assets (Level 1) | Inputs (Level 2) | Inputs (Level 3) | ||||||||||||||
(In thousands) | |||||||||||||||||
Investment Type | |||||||||||||||||
Mutual Funds- Equity | |||||||||||||||||
Large-Cap Value | $ | 320 | $ | 320 | $ | — | $ | — | |||||||||
Large-Cap Core | 323 | 323 | — | — | |||||||||||||
Mid-Cap Core | 161 | 161 | — | — | |||||||||||||
Small-Cap Core | 165 | 165 | — | — | |||||||||||||
Non-U.S. Core | 717 | 717 | — | — | |||||||||||||
Mutual Funds- Fixed Income | |||||||||||||||||
Intermediate-Term Core | 1,006 | 1,006 | — | — | |||||||||||||
Cash Equivalents | |||||||||||||||||
Money Market | 38 | 38 | — | — | |||||||||||||
Total Investment | $ | 2,730 | $ | 2,730 | $ | — | $ | — | |||||||||
Fair Value Measurements at Reporting Date Using: | |||||||||||||||||
Quoted Prices | Significant | ||||||||||||||||
At | in Active Markets | Other | Significant | ||||||||||||||
September 30, | for Identical | Observable | Unobservable | ||||||||||||||
2012 | Assets (Level 1) | Inputs (Level 2) | Inputs (Level 3) | ||||||||||||||
(In thousands) | |||||||||||||||||
Investment Type | |||||||||||||||||
Mutual Funds- Equity | |||||||||||||||||
Large-Cap Value | $ | 270 | $ | 270 | $ | — | $ | — | |||||||||
Large-Cap Core | 278 | 278 | — | — | |||||||||||||
Mid-Cap Core | 129 | 129 | — | — | |||||||||||||
Small-Cap Core | 130 | 130 | — | — | |||||||||||||
Non-U.S. Core | 628 | 628 | — | — | |||||||||||||
Mutual Funds- Fixed Income | |||||||||||||||||
Intermediate-Term Core | 1,051 | 1,051 | — | — | |||||||||||||
Cash Equivalents | |||||||||||||||||
Money Market | 1 | 1 | — | — | |||||||||||||
Total Investment | $ | 2,487 | $ | 2,487 | $ | — | $ | — | |||||||||
Equity and debt securities are reported at fair value in the table above utilizing exchange quoted prices in active markets for identical instruments (Level 1 inputs). |
NONQUALIFIED_COMPENSATION_PLAN
NONQUALIFIED COMPENSATION PLAN | 12 Months Ended |
Sep. 30, 2013 | |
Postemployment Benefits [Abstract] | ' |
NONQUALIFIED COMPENSATION PLAN | ' |
NOTE N - NONQUALIFIED COMPENSATION PLAN | |
The Company maintains a Supplemental Executive Retirement Plan (SERP) for the benefit of its senior officers. In addition, the Company also adopted voluntary Deferred Income and Emeritus Plans on behalf of its directors and those directors elected by the Board as “Director Emeritus.” The SERP provides the Company with the opportunity to supplement the retirement income of selected officers to achieve equitable wage replacement at retirement while the Deferred Income Plan provides participating directors with an opportunity to defer all or a portion of their fees into a tax deferred accumulation account for future retirement. The Director Emeritus Plan enables the Company to reward its directors for longevity of service in consideration of their availability and consultation at a sum equal to a fifteen year certain annuity based on fifty-percent of last years’ Board fee. The SERP is based upon achieving retirement benefits equal to two percent multiplied by the number of service years multiplied by the final salary. | |
In 2001, the Company adopted a New Director Emeritus Plan (the “New Plan”), which supplemented the prior Director Emeritus Plans. Under the New Plan, the directors will be entitled to a benefit upon attainment of his/her benefit age. The directors will receive an annual amount in monthly installments based on his/her total Board and Committee fees in the twelve months prior to attainment of his/her benefit age. The amount will be ten percent (10%) plus two and one-half percent (2 1/2%) for each year of service as a Director, with a minimum of fifty percent (50%), provided the Director has served for at least five (5) years, and a maximum of sixty percent (60%). The maximum benefit increases for any Director serving as Chairman of the Board to seventy-five percent (75%). | |
The Company funds the plans through a modified endowment contract. Income recorded for the plans represents life insurance income as recorded based on the projected increases in cash surrender values of life insurance policies. As of September 30, 2013 and 2012, the Life Insurance Contracts had cash surrender values of approximately $10,342,000 and $10,010,000, respectively. | |
The Company is recording benefit costs so that the cost of each participant’s retirement benefits is being expensed and accrued over the participant’s active employment so as to result in a liability at retirement date equal to the present value of the benefits expected to be provided. |
401K_EMPLOYEE_CONTRIBUTION_PLA
401(K) EMPLOYEE CONTRIBUTION PLAN | 12 Months Ended |
Sep. 30, 2013 | |
K Employee Contribution Plan | ' |
401(K) EMPLOYEE CONTRIBUTION PLAN | ' |
NOTE O - 401(K) EMPLOYEE CONTRIBUTION PLAN | |
The Company has a defined contribution 401(k) plan covering all employees, as defined under the plan document. Employees may contribute to the plan, as defined under the plan document, and the Company can make discretionary contributions. The Company contributed $38,000 and $0 to the plan for the years ended September 30, 2013 and 2012, respectively. |
COMMITMENTS
COMMITMENTS | 12 Months Ended | ||||
Sep. 30, 2013 | |||||
Commitments and Contingencies Disclosure [Abstract] | ' | ||||
COMMITMENTS | ' | ||||
NOTE P - COMMITMENTS | |||||
1 | Lease Commitments | ||||
Approximate future minimum payments under non-cancelable operating leases are due as follows for the years ending September 30 (in thousands): | |||||
September 30, | |||||
2014 | $ | 568 | |||
2015 | 568 | ||||
2016 | 588 | ||||
2017 | 627 | ||||
2018 | 627 | ||||
Thereafter | 5,011 | ||||
$ | 7,989 | ||||
Total rental expense was approximately $739,000 and $789,000 for the years ended September 30, 2013 and 2012, respectively. | |||||
2 | Contingencies | ||||
The Company and its subsidiaries, from time to time, are a party to routine litigation that arises in the normal course of business. In the opinion of management, the resolution of this litigation, if any, would not have a material adverse effect on the Company’s consolidated financial position or results of operations. |
FINANCIAL_INSTRUMENTS_WITH_OFF
FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Financial Instruments With Off-Balance Sheet Risk | ' | ||||||||
FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK | ' | ||||||||
NOTE Q - FINANCIAL INSTRUMENTS WITH OFF-BALANCE-SHEET RISK | |||||||||
The Company may use derivative financial instruments, such as interest rate floors and collars, as part of its interest rate risk management. Interest rate caps and floors are agreements whereby one party agrees to pay or receive a floating rate of interest on a notional principal amount for a predetermined period of time if certain market interest rate thresholds are met. The Company considers the credit risk inherent in these contracts to be negligible. As of September 30, 2013, the Company did not hold any interest rate floors or collars. | |||||||||
In April 2008, the Company unwound a $10 million interest rate collar with Lehman Brothers Special Financing Inc. and received an $817,000 termination fee. The termination fee was netted against the book value of $112,000, resulting in an unrealized gain of $705,000. In accordance with US GAAP, the unrealized gain remained in other comprehensive income, net of deferred tax expense, and was accreted to income over the contracted life of the interest rate collar, which matured June 24, 2013. At September 30, 2012, the book value of the unwound derivative was $54,000, recorded as $33,000 in other comprehensive loss, net of deferred tax of $21,000. | |||||||||
The Company is a party to financial instruments with off-balance-sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments are commitments to extend credit. Those instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amounts recognized in the balance sheets. | |||||||||
The Company’s exposure to credit loss in the event of nonperformance by the other party to the financial instrument for commitments to extend credit is represented by the contractual notional amount of those instruments. The Company uses the same credit policies in making commitments and conditional obligations as it does for on-balance-sheet instruments. | |||||||||
At September 30, 2013 and 2012, the Company had outstanding commitments (substantially all of which expire within one year) to originate residential mortgage loans, construction loans, commercial real estate and consumer loans. These commitments were comprised of fixed and variable rate loans. | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
(Dollars in thousands) | |||||||||
Financial instruments whose contract amounts | |||||||||
represent credit risk (in thousands) | |||||||||
Letters of credit | $ | 1,450 | $ | 1,450 | |||||
Unused lines of credit | 38,823 | 41,162 | |||||||
Fixed rate loan commitments | 2,546 | 1,988 | |||||||
Variable rate loan commitments | 6,985 | 14,112 | |||||||
$ | 49,804 | $ | 58,712 | ||||||
FAIR_VALUE_DISCLOSURES
FAIR VALUE DISCLOSURES | 12 Months Ended | ||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||||||
FAIR VALUE DISCLOSURES | ' | ||||||||||||||||||||
NOTE R - FAIR VALUE DISCLOSURES | |||||||||||||||||||||
We use fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures. Our securities available-for-sale are recorded at fair value on a recurring basis. Additionally, from time to time, we may be required to record at fair value other assets or liabilities on a non-recurring basis, such as held-to-maturity securities, mortgage servicing rights, loans receivable and other real estate owned, or OREO. These non-recurring fair value adjustments involve the application of lower-of-cost-or-market accounting or write-downs of individual assets. | |||||||||||||||||||||
In accordance with ASC 820, Fair Value Measurements and Disclosures, we group our assets and liabilities at fair value in three levels, based on the markets in which the assets are traded and the reliability of the assumptions used to determine fair value. These levels are: | |||||||||||||||||||||
Level 1- Valuation is based upon quoted prices for identical instruments traded in active markets. | |||||||||||||||||||||
Level 2- Valuation is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-based valuation techniques for which all significant assumptions are observable in the market. | |||||||||||||||||||||
Level 3- Valuation is generated from model-based techniques that use significant assumptions not observable in the market. These unobservable assumptions reflect our own estimates of assumptions that market participants would use in pricing the asset or liability. Valuation techniques include the use of option pricing models, discounted cash flow models and similar techniques. The results cannot be determined with precision and may not be realized in an actual sale or immediate settlement of the asset or liability. | |||||||||||||||||||||
We base our fair values on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC 820 requires us to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. | |||||||||||||||||||||
The following is a description of valuation methodologies used for assets measured at fair value on a recurring basis. | |||||||||||||||||||||
Securities available-for-sale | |||||||||||||||||||||
Our available-for-sale portfolio is carried at estimated fair value on a recurring basis, with any unrealized gains and losses, net of taxes, reported as accumulated other comprehensive income/loss in stockholders’ equity. Our securities available-for-sale portfolio consists of U.S. government and government-sponsored enterprise obligations, municipal bonds, and mortgage-backed securities. The fair values of these securities are obtained from an independent nationally recognized pricing service. Our independent pricing service provides us with prices which are categorized as Level 2, as quoted prices in active markets for identical assets are generally not available for the securities in our portfolio. | |||||||||||||||||||||
Derivative financial instruments | |||||||||||||||||||||
The Company uses interest rate floors to manage its interest rate risk. The valuation of these instruments is based on a third party value of interest rate derivative contracts which are based on the fair market value using market prices provided from brokers trading in such instruments, less their carrying value. The carrying value is the price paid for the derivative contracts less prior amortization of the price paid. There are no remaining derivative financial instruments at September 30, 2013. | |||||||||||||||||||||
The following table provides the level of valuation assumptions used to determine the carrying value of our assets measured at fair value on a recurring basis at September 30, 2013 and 2012: | |||||||||||||||||||||
Fair Value at September 30, 2013 | |||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | ||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||
Securities available for sale: | |||||||||||||||||||||
Obligations of U.S. government agencies: | |||||||||||||||||||||
Mortgage-backed securities - residential | $ | 1,556 | $ | — | $ | 1,556 | $ | — | |||||||||||||
Obligations of U.S. government-sponsored enterprises: | |||||||||||||||||||||
Mortgage-backed securities - residential | 9,401 | — | 9,401 | — | |||||||||||||||||
Mortgage-backed securities - commercial | 4,002 | — | 4,002 | — | |||||||||||||||||
Private label mortgage-backed securities - residential | 815 | — | 815 | — | |||||||||||||||||
Total securities available for sale | $ | 15,774 | $ | — | $ | 15,774 | $ | — | |||||||||||||
Fair Value at September 30, 2012 | |||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | ||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||
Securities available for sale: | |||||||||||||||||||||
Obligations of U.S. government agencies: | |||||||||||||||||||||
Mortgage-backed securities - residential | $ | 1,861 | $ | — | $ | 1,861 | $ | — | |||||||||||||
Obligations of U.S. government-sponsored enterprises: | |||||||||||||||||||||
Mortgage-backed securities - residential | 8,575 | — | 8,575 | — | |||||||||||||||||
Mortgage-backed securities - commercial | 4,228 | — | 4,228 | — | |||||||||||||||||
Debt securities | 1,067 | — | 1,067 | — | |||||||||||||||||
Private label mortgage-backed securities - residential | 1,055 | — | 1,055 | — | |||||||||||||||||
Total securities available for sale | $ | 16,786 | $ | — | $ | 16,786 | $ | — | |||||||||||||
The following is a description of valuation methodologies used for assets measured at fair value on a non-recurring basis. | |||||||||||||||||||||
Mortgage Servicing Rights | |||||||||||||||||||||
Mortgage Servicing Rights (MSR’s) are carried at the lower of amortized cost or estimated fair value. The estimated fair value of MSRs is determined through a calculation of future cash flows, incorporating estimates of assumptions market participants would use in determining fair value including market discount rates, prepayment speeds, servicing income, servicing costs, default rates and other market driven data, including the market’s perception of future interest rate movements and, as such, are classified as Level 3. No valuation write-downs were made to MSR’s during the years ended September 30, 2013 and 2012. | |||||||||||||||||||||
Impaired Loans | |||||||||||||||||||||
Loans which meet certain criteria are evaluated individually for impairment. A loan is impaired when, based on current information and events, it is probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan agreement. All amounts due according to the contractual terms means that both the contractual interest and principal payments of a loan will be collected as scheduled in the loan agreement. Three impairment measurement methods are used, depending upon the collateral securing the asset: 1) the present value of expected future cash flows discounted at the loan’s effective interest rate (the rate of return implicit in the loan); 2) the asset’s observable market price; or 3) the fair value of the collateral if the asset is collateral dependent. The regulatory agencies require this method for loans from which repayment is expected to be provided solely by the underlying collateral. Our impaired loans are generally collateral dependent and, as such, are carried at the estimated fair value of the collateral less estimated selling costs. Fair value is estimated through current appraisals, and adjusted as necessary, by management, to reflect current market conditions and, as such, are generally classified as Level 3. | |||||||||||||||||||||
Appraisals of collateral securing impaired loans are conducted by approved, qualified, and independent third-party appraisers. Such appraisals are ordered via the Bank’s credit administration department, independent from the lender who originated the loan, once the loan is deemed impaired, as described in the previous paragraph. Impaired loans are generally re-evaluated with an updated appraisal within one year of the last appraisal. However, the Company also obtains updated appraisals on performing construction loans that are approaching their maturity date to determine whether or not the fair value of the collateral securing the loan remains sufficient to cover the loan amount prior to considering an extension. The Company discounts the appraised “as is” value of the collateral for estimated selling and disposition costs and compares the resulting fair value of collateral to the outstanding loan amount. If the outstanding loan amount is greater than the discounted fair value, the Company requires a reduction in the outstanding loan balance or additional collateral before considering an extension to the loan. If the borrower is unwilling or unable to reduce the loan balance or increase the collateral securing the loan, it is deemed impaired and the difference between the loan amount and the fair value of collateral, net of estimated selling and disposition costs, is charged off through a reduction of the allowance for loan loss. | |||||||||||||||||||||
Other Real Estate Owned | |||||||||||||||||||||
Other real estate owned is carried at lower of cost or estimated fair value less disposal costs. The estimated fair value of the real estate is determined through current appraisals, and adjusted as necessary, by management, to reflect current market conditions. As such, other real estate owned is generally classified as Level 3. Valuation write-downs totaling $42,000 were made to one properties held as other real estate owned during the year ended September 30, 2013. The property was written down based on an updated appraisal of the real estate. | |||||||||||||||||||||
The following tables provide the level of valuation assumptions used to determine the carrying value of our assets measured at fair value on a non-recurring basis at September 30, 2013 and 2012: | |||||||||||||||||||||
Fair Value at September 30, 2013 | |||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | ||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||
Impaired loans | $ | 8,534 | $ | — | $ | — | $ | 8,534 | |||||||||||||
Other real estate owned | 230 | — | — | 230 | |||||||||||||||||
$ | 8,764 | $ | — | $ | — | $ | 8,764 | ||||||||||||||
Fair Value at September 30, 2012 | |||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | ||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||
Impaired loans | $ | 5,984 | $ | — | $ | — | $ | 5,984 | |||||||||||||
Other real estate owned | 464 | — | — | 464 | |||||||||||||||||
$ | 6,448 | $ | — | $ | — | $ | 6,448 | ||||||||||||||
Impaired loans reported for the period ended September 30, 2013 consisted of 23 loans with aggregate loan balances of $11.6 million reduced by $2.7 million in cumulative charge-offs ($1.8 million in the current year) and $542,000 in specific loss reserves. These loans are all collateralized by real estate. | |||||||||||||||||||||
The following table presents additional quantitative information about assets measured at fair value on a nonrecurring basis and for which Company has utilized Level 3 inputs to determine fair value: | |||||||||||||||||||||
Quantitative Information about Level 3 Fair Value Measurements | |||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||
Fair Value | Valuation | ||||||||||||||||||||
30-Sep-13 | Estimate | Techniques | Unobservable Input | Range (Weighted Average) | |||||||||||||||||
Impaired loans | $ | 8,534 | Appraisal of | Liquidation expenses (2) | 0% to -8.0% (-6.04%) | ||||||||||||||||
collateral (1) | |||||||||||||||||||||
Other real estate owned | $ | 230 | Appraisal of | Appraisal adjustments (2) | 15.40% | ||||||||||||||||
collateral (1), (3) | |||||||||||||||||||||
-1 | Fair value is generally determined through independent appraisals for the underlying collateral, which generally include various level 3 inputs which are not identifiable. | ||||||||||||||||||||
-2 | Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated liquidation expenses. The range and weighted average of liquidation expenses and other appraisal adjustments are presented as a percent of the appraisal. | ||||||||||||||||||||
-3 | Includes qualitative adjustments by management and estimated liquidation expenses. | ||||||||||||||||||||
The following methods and assumptions were used to estimate the fair value of each class of financial instruments for which it is practicable to estimate fair value: | |||||||||||||||||||||
Cash and interest earning deposits with banks: The carrying amounts are a reasonable estimate of fair value. | |||||||||||||||||||||
Held to maturity securities: The fair values of our held to maturity securities are obtained from an independent nationally recognized pricing service. Our independent pricing service provides us with prices which are categorized as Level 2, as quoted prices in active markets for identical assets are generally not available for the securities in our portfolio. | |||||||||||||||||||||
Loans: Fair value for the loan portfolio, excluding impaired loans, is estimated based on discounted cash flow analysis using interest rates currently offered for loans with similar terms to borrowers of similar credit quality. | |||||||||||||||||||||
Bank-owned life insurance: The carrying amounts are based on the cash surrender values of the individual policies, which is a reasonable estimate of fair value. | |||||||||||||||||||||
Deposits: The fair value of savings deposits with no stated maturity, such as money market deposit accounts, interest-bearing checking accounts and savings accounts, is equal to the amount payable on demand. The fair value of certificates of deposit is based on the discounted value of contractual cash flows. The discount rate is equivalent to the rate currently offered by the Bank for deposits of similar size, type and maturity. | |||||||||||||||||||||
Accrued interest receivable and payable: For these short-term instruments, the carrying amount is a reasonable estimate of fair value. | |||||||||||||||||||||
Federal Home Loan Bank of New York advances and securities sold under reverse repurchase agreements: The fair value of borrowings is based on the discounted value of contractual cash flows. The discount rate is equivalent to the rate currently offered by the Federal Home Loan Bank of New York for borrowings of similar maturity and terms. | |||||||||||||||||||||
Interest rate derivatives: The third party value of interest rate derivative contracts are based on the fair market value using market prices provided from brokers trading in such instruments, less their carrying value. The carrying value is the price paid for the derivative contracts less prior amortization of the price paid. | |||||||||||||||||||||
The fair value of commitments to extend credit is estimated based on the amount of unamortized deferred loan commitment fees. The fair value of letters of credit is based on the amount of unearned fees plus the estimated cost to terminate the letters of credit. Fair values of unrecognized financial instruments including commitments to extend credit and the fair value of letters of credit are considered immaterial. | |||||||||||||||||||||
The following presents the carrying amount, fair value, and placement in the fair value hierarchy of the Company’s financial instruments carried at cost or amortized cost as of September 30, 2013 and September 30, 2012. This table excludes financial instruments for which the carrying amount approximates fair value. For short-term financial assets such as cash and cash equivalents, the carrying amount is a reasonable estimate of fair value due to the relatively short time between the origination of the instrument and its expected realization. For financial liabilities such as interest-bearing demand, NOW, and money market savings deposits, the carrying amount is a reasonable estimate of fair value due to these products having no stated maturity. | |||||||||||||||||||||
Carrying | Fair | Fair Value Measurement Placement | |||||||||||||||||||
Value | Value | (Level 1) | (Level 2) | (Level 3) | |||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||
Financial instruments - assets | |||||||||||||||||||||
Investment securities held-to-maturity | $ | 52,558 | $ | 51,802 | $ | — | $ | 51,802 | $ | — | |||||||||||
Loans | 396,800 | 401,064 | — | — | 401,064 | ||||||||||||||||
Financial instruments - liabilities | |||||||||||||||||||||
Certificate of deposit | 153,841 | 155,306 | — | 155,306 | — | ||||||||||||||||
Borrowings | 32,100 | 33,430 | — | 33,430 | — | ||||||||||||||||
30-Sep-12 | |||||||||||||||||||||
Financial instruments - assets | |||||||||||||||||||||
Investment securities held-to-maturity | $ | 41,068 | $ | 42,130 | — | $ | 42,130 | $ | — | ||||||||||||
Loans | 385,270 | 396,111 | — | — | 396,111 | ||||||||||||||||
Financial instruments - liabilities | |||||||||||||||||||||
Certificate of deposit | 158,461 | 160,753 | — | 160,753 | — | ||||||||||||||||
Borrowings | 41,503 | 43,898 | — | 43,898 | — | ||||||||||||||||
REGULATORY_CAPITAL
REGULATORY CAPITAL | 12 Months Ended | ||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||
Banking and Thrift [Abstract] | ' | ||||||||||||||||||||||||
REGULATORY CAPITAL | ' | ||||||||||||||||||||||||
NOTE S - REGULATORY CAPITAL | |||||||||||||||||||||||||
The Company and Bank are required to maintain minimum amounts of capital to total “risk-weighted” assets, as defined by the banking regulators. Failure to meet minimum capital requirements can initiate certain mandatory and possibly discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and Bank must meet specific capital guidelines that involve quantitative measures of the Company’s and Bank’s assets, liabilities, and certain off balance sheet items as calculated under regulatory accounting practices. The capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings and other factors. | |||||||||||||||||||||||||
Quantitative measures established by regulation to ensure capital adequacy require the Company and Bank to maintain minimum ratios of Leverage Capital, Tier I and Total Risk-based Capital. The following table sets forth the Company’s and the Bank’s actual and required capital levels under those measures: | |||||||||||||||||||||||||
To be well-capitalized | |||||||||||||||||||||||||
For capital | under prompt corrective | ||||||||||||||||||||||||
Actual | adequacy purposes | action provisions | |||||||||||||||||||||||
Amount | Ratio | Amount | Ratio | Amount | Ratio | ||||||||||||||||||||
As of September 30, 2013 | |||||||||||||||||||||||||
Total Capital (to risk-weighted assets) | |||||||||||||||||||||||||
Magyar Bancorp, Inc. | 48,948 | 13.24% | 29,584 | > 8.00% | N/A | N/A | |||||||||||||||||||
Magyar Bank | 46,313 | 12.52% | 29,582 | > 8.00% | 36,977 | > 10.00% | |||||||||||||||||||
Tier 1 Capital (to risk-weighted assets) | |||||||||||||||||||||||||
Magyar Bancorp, Inc. | 45,935 | 12.42% | 14,792 | > 4.00% | N/A | N/A | |||||||||||||||||||
Magyar Bank | 43,300 | 11.71% | 14,791 | > 4.00% | 22,186 | > 6.00% | |||||||||||||||||||
Tier 1 Capital (to average assets) | |||||||||||||||||||||||||
Magyar Bancorp, Inc. | 45,935 | 8.61% | 21,341 | > 4.00% | N/A | N/A | |||||||||||||||||||
Magyar Bank | 43,300 | 8.12% | 21,340 | > 4.00% | 26,676 | > 5.00% | |||||||||||||||||||
As of September 30, 2012 | |||||||||||||||||||||||||
Total Capital (to risk-weighted assets) | |||||||||||||||||||||||||
Magyar Bancorp, Inc. | 49,439 | 13.93% | 28,402 | > 8.00% | N/A | N/A | |||||||||||||||||||
Magyar Bank | 46,897 | 13.21% | 28,400 | > 8.00% | 35,500 | > 10.00% | |||||||||||||||||||
Tier 1 Capital (to risk-weighted assets) | |||||||||||||||||||||||||
Magyar Bancorp, Inc. | 45,581 | 12.84% | 14,201 | > 4.00% | N/A | N/A | |||||||||||||||||||
Magyar Bank | 43,039 | 12.12% | 14,200 | > 4.00% | 21,300 | > 6.00% | |||||||||||||||||||
Tier 1 Capital (to average assets) | |||||||||||||||||||||||||
Magyar Bancorp, Inc. | 45,581 | 8.90% | 20,492 | > 4.00% | N/A | N/A | |||||||||||||||||||
Magyar Bank | 43,039 | 8.40% | 20,491 | > 4.00% | 25,614 | > 5.00% | |||||||||||||||||||
On April 22, 2010, Magyar Bank entered into Consent Order agreements with the Federal Deposit Insurance Corporation and the New Jersey Department of Banking and Insurance which required the Bank to develop a written capital plan that details the manner in which the Bank will achieve a Tier 1 capital as a percentage of the Bank's total assets of at least 8.0%, and total qualifying capital as a percentage of risk-weighted assets of at least 12.0%. | |||||||||||||||||||||||||
On March 2, 2012 the Bank was informed in writing by the Federal Deposit Insurance Corporation and the New Jersey Department of Banking and Insurance, that the Consent Order had been terminated. The Bank is required to maintain Tier 1 capital as a percentage of the Bank's total assets of at least 8.0%, and total qualifying capital as a percentage of risk-weighted assets of at least 12.0%. As of September 30, 2013, Magyar Bank’s Tier 1 capital as a percentage of the Bank's total assets was 8.12% and the total qualifying capital as a percentage of risk-weighted assets was 12.52%. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended | ||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||||||||||||||
Basis of Financial Statement Presentation | ' | ||||||||||||||||||||||||
1. Basis of Financial Statement Presentation | |||||||||||||||||||||||||
The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America (US GAAP) and predominant practices within the banking industry. The financial statements include the accounts of the Company and its wholly owned subsidiary, the Bank, and its wholly-owned subsidiaries MagBank Investment Company, Magyar Service Corporation, and Hungaria Urban Renewal, LLC. All intercompany balances and transactions have been eliminated in the financial statements. | |||||||||||||||||||||||||
The Company has evaluated subsequent events and transactions occurring subsequent to the consolidated balance sheet date of September 30, 2013, for items that should potentially be recognized or disclosed in these financial statements. The evaluation was conducted through the date these financial statements were issued. | |||||||||||||||||||||||||
In preparing financial statements in conformity with US GAAP, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. | |||||||||||||||||||||||||
The principal estimates that are particularly susceptible to significant change in the near term relate to the allowance for loan losses and the deferred tax asset. The evaluation of the adequacy of the allowance for loan losses includes an analysis of the individual loans and overall risk characteristics and size of the different loan portfolios, and takes into consideration current economic and market conditions, the capability of specific borrowers to pay specific loan obligations, as well as current loan collateral values. However, actual losses on specific loans, which also are encompassed in the analysis, may vary from estimated losses. | |||||||||||||||||||||||||
The Company records income taxes using the asset and liability method. Accordingly, deferred tax assets and liabilities: (i) are recognized for the expected future tax consequences of events that have been recognized in the financial statements or tax returns; (ii) are attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases; and (iii) are measured using enacted tax rates expected to apply in the years when those temporary differences are expected to be recovered or settled. | |||||||||||||||||||||||||
Where applicable, deferred tax assets are reduced by a valuation allowance for any portions determined not likely to be realized. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income tax expense in the period of enactment. The valuation allowance is adjusted, by a charge or credit to income tax expense, as changes in facts and circumstances warrant. | |||||||||||||||||||||||||
Cash and Cash Equivalents | ' | ||||||||||||||||||||||||
2. Cash and Cash Equivalents | |||||||||||||||||||||||||
For purposes of reporting cash flows, cash and cash equivalents include cash on hand, amounts due from banks, time deposits with original maturities less than three months and overnight deposits. | |||||||||||||||||||||||||
Investment Securities | ' | ||||||||||||||||||||||||
3. Investment Securities | |||||||||||||||||||||||||
The Company classifies its investment securities into one of three portfolios: held to maturity, available for sale or trading. Investments in debt securities that we have the positive intent and ability to hold to maturity are classified as held to maturity securities and reported at amortized cost. Debt and equity securities that are bought and held principally for the purpose of selling them in the near term are classified as trading securities and reported at fair value, with unrealized holding gains and losses included in earnings. Debt and equity securities not classified as trading securities or as held to maturity securities are classified as available for sale securities and reported at fair value, with unrealized holding gains or losses, net of deferred income taxes, reported in the accumulated other comprehensive income (“AOCI”) component of stockholders’ equity. | |||||||||||||||||||||||||
If the fair value of a security is less than its amortized cost, the security is deemed to be impaired. Management evaluates all securities with unrealized losses quarterly to determine if such impairments are “temporary” or “other-than-temporary” in accordance with applicable accounting guidance. The Company accounts for temporary impairments based upon security classification as either available for sale, held to maturity or trading. Temporary impairments on “available for sale” securities are recognized, on a tax-effected basis, through AOCI with offsetting entries adjusting the carrying value of the security and the balance of deferred taxes. Conversely, the Company does not adjust the carrying value of “held to maturity” securities for temporary impairments, although information concerning the amount and duration of impairments on held to maturity securities is generally disclosed in periodic financial statements. The carrying value of securities held in a trading portfolio is adjusted to their fair value through earnings on a daily basis. However, the Company maintained no securities in trading portfolios at or during the periods presented in these financial statements. | |||||||||||||||||||||||||
The Company accounts for other-than-temporary impairments based upon several considerations. First, other-than-temporary impairments on securities that the Company has decided to sell as of the close of a fiscal period, or will, more likely than not, be required to sell prior to the full recovery of the their fair value to a level equal to or exceeding their amortized cost, are recognized in operations. If neither of these criteria apply, then the other-than-temporary impairment is separated into credit-related and noncredit-related components. The credit-related impairment generally represents the amount by which the present value of the cash flows that are expected to be collected on an other-than-temporarily impaired security fall below its amortized cost while the noncredit-related component represents the remaining portion of the impairment not otherwise designated as credit-related. The Company recognizes credit-related, other-than-temporary impairments in earnings, while noncredit-related, other-than-temporary impairments on debt securities are recognized, net of deferred taxes, in AOCI. | |||||||||||||||||||||||||
Federal law requires a member institution of the Federal Home Loan Bank (“FHLB”) system to purchase and hold restricted stock of its district FHLB according to a predetermined formula. This stock is restricted in that it may only be sold to the FHLB and all sales must be at par. Accordingly, the FHLB restricted stock is carried at cost, less any applicable impairment charges. | |||||||||||||||||||||||||
Premiums and discounts on all securities are amortized or accreted to maturity by use of the level-yield method considering the impact of principal amortization and prepayments on mortgage-backed securities. Gain or loss on sales of securities is recognized on the specific identification method. | |||||||||||||||||||||||||
Loans and Allowance for Loan Losses | ' | ||||||||||||||||||||||||
4. Loans and Allowance for Loan Losses | |||||||||||||||||||||||||
Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are stated at the amount of unpaid principal, adjusted for net deferred loan fees and costs, and reduced by an allowance for loan losses. Interest on loans is accrued and credited to operations based upon the principal amounts outstanding. The allowance for loan losses is established through a provision for possible loan losses charged to operations. Loans are charged against the allowance for loan losses when management believes that the collectability of the principal is unlikely. | |||||||||||||||||||||||||
Income recognition of interest is discontinued when, in the opinion of management, the collectability of such interest becomes doubtful. A loan is generally classified as non-accrual when the scheduled payment(s) due on the loan is delinquent for more than three months. Loan origination fees and certain direct origination costs are deferred and amortized over the life of the related loans as an adjustment to the yield on loans receivable using the effective interest method. | |||||||||||||||||||||||||
Management uses a ten point internal risk rating system to monitor the credit quality of the overall loan portfolio. The first six categories are considered not criticized, and are aggregated as “Pass” rated. The criticized rating categories utilized by management generally follow bank regulatory definitions. The Special Mention category includes assets that are currently protected but are potentially weak, resulting in an undue and unwarranted credit risk, but not to the point of justifying a Substandard classification. Loans in the Substandard category have well-defined weaknesses that jeopardize the liquidation of the debt, and have a distinct possibility that some loss will be sustained if the weaknesses are not corrected. All loans greater than three months past due are considered Substandard. Any portion of a loan that has been charged off is placed in the Loss category. | |||||||||||||||||||||||||
To help ensure that risk ratings are accurate and reflect the present and future capacity of borrowers to repay a loan as agreed, the Bank has a structured loan rating process with several layers of internal and external oversight. Generally, consumer and residential mortgage loans are included in the Pass categories unless a specific action, such as severe delinquency, bankruptcy, repossession, or death occurs to raise awareness of a possible credit event. The Bank’s Commercial Loan Officers are responsible for the timely and accurate risk rating of the loans in their portfolios at origination and on an ongoing basis. The Asset Review Committee performs monthly reviews of all commercial relationships internally rated 6 (“Watch”) or worse. Confirmation of the appropriate risk grade is performed by an external loan review company that semi-annually reviews and assesses loans within the portfolio. Generally, the external consultant reviews commercial relationships greater than $500,000 and/or criticized relationships greater than $250,000. Detailed reviews, including plans for resolution, are performed on loans classified as Substandard on a monthly basis. | |||||||||||||||||||||||||
The allowance for loan losses is maintained at an amount management deems adequate to cover estimated losses. In determining the level to be maintained, management evaluates many factors, including current economic trends, industry experience, historical loss experience, industry loan concentrations, the borrowers’ ability to repay and repayment performance, and estimated collateral values. In the opinion of management, the present allowance is adequate to absorb reasonable, foreseeable loan losses. While management uses the best information available to make such evaluations, future adjustments to the allowance may be necessary based on changes in economic conditions or any of the other factors used in management’s determination. In addition, various regulatory agencies, as an integral part of their examination process, periodically review the Company’s allowance for losses on loans. Such agencies may require the Company to recognize additions to the allowance based on their judgments about information available to them at the time of their examination. Charge-offs to the allowance are made when the loan is transferred to other real estate owned or other determination of a confirmed loss. Recoveries on loans previously charged off are also recorded through the allowance. | |||||||||||||||||||||||||
A loan is considered impaired when, based upon current information and events, it is probable that a creditor will be unable to collect all amounts due including principal and interest, according to the contractual terms of the loan agreement. The Company measures impaired loans based on the present value of expected future cash flows discounted at the loan’s effective interest rate or as a practical expedient, at the loan’s current observable market price, or the fair value of the collateral if the loan is collateral dependent. The amount by which the recorded investment of an impaired loan exceeds the measurement value is recognized by creating a valuation allowance through a charge to the provision for loan losses. Impairment criteria generally do not apply to those smaller-balance homogeneous loans that are collectively evaluated for impairment which for the Company includes one- to four-family first mortgage loans and consumer loans, other than those modified in a troubled debt restructuring. | |||||||||||||||||||||||||
The Company records cash receipts on impaired loans that are non-performing as a reduction to principal before applying amounts to interest or late charges unless specifically directed by the Bankruptcy Court to apply payments otherwise. The Company continues to recognize interest income on impaired loans where there is no confirmed loss. | |||||||||||||||||||||||||
Premises and Equipment | ' | ||||||||||||||||||||||||
5. Premises and Equipment | |||||||||||||||||||||||||
Premises and equipment are carried at cost less accumulated depreciation, and include capitalized expenditures for new facilities, major betterments and renewals. Expenditures for maintenance and repairs are charged to expense as incurred. Depreciation is computed using the straight-line method based upon the estimated useful lives of the related assets for financial reporting purposes and using the mandated methods by asset type for income tax purposes. Leasehold improvements are depreciated using the straight-line method based upon the initial term of the lease. | |||||||||||||||||||||||||
The Company accounts for the impairment of long-lived assets in accordance with US GAAP, which requires recognition and measurement for the impairment of long-lived assets to be held and used or to be disposed of by sale. The Company had no impaired long-lived assets at September 30, 2013 and 2012 | |||||||||||||||||||||||||
Derivative Contracts | ' | ||||||||||||||||||||||||
6. Derivative Contracts | |||||||||||||||||||||||||
Derivative contracts are carried at fair value with unrealized gains and losses excluded from earnings and reported in a separate component of stockholders’ equity, net of related income tax effects. Gains and losses on derivative contracts are recognized upon realization utilizing the specific identification method. | |||||||||||||||||||||||||
As required by US GAAP, the Company recognizes all derivatives as either assets or liabilities in the statement of financial condition and measures those instruments at fair value. | |||||||||||||||||||||||||
Other Real Estate Owned | ' | ||||||||||||||||||||||||
7. Other Real Estate Owned | |||||||||||||||||||||||||
Real estate acquired through foreclosure, or a deed-in-lieu of foreclosure, is recorded at fair value less estimated selling costs at the date of acquisition or transfer, and subsequently at the lower of its new cost or fair value less estimated selling costs. Adjustments to the carrying value at the date of acquisition or transfer are charged to the allowance for loan losses. The carrying value of the individual properties is subsequently adjusted to the extent it exceeds estimated fair value less estimated selling costs, at which time a provision for losses on such real estate is charged to operations. | |||||||||||||||||||||||||
Operating expenses of holding real estate, net of related income, are charged against income as incurred. Gains on sales of real estate are recognized, normally at closing, when down payment and certain other requirements are met; otherwise such gains are deferred and recognized on the installment method of accounting. Losses on the disposition of real estate, including expenses incurred in connection with the disposition, are charged to operations. | |||||||||||||||||||||||||
Income Taxes | ' | ||||||||||||||||||||||||
8. Income Taxes | |||||||||||||||||||||||||
The Company and its subsidiaries file consolidated federal and individual state income tax returns. Income taxes are allocated based on the contribution of their respective income or loss to the consolidated income tax return. | |||||||||||||||||||||||||
The Company records income taxes on the basis of reported income using the asset and liability method. Accordingly, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. To the extent that current available evidence about the future raises doubt about the realization of a deferred tax asset, a valuation allowance is established. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. | |||||||||||||||||||||||||
The Company follows the provisions of FASB ASC Topic 740, which provides clarification on accounting for uncertainty in income taxes recognized in an enterprise’s financial statements. The guidance prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return, and also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. At September 30, 2013 and 2012, no significant income tax uncertainties have been included in the Company’s Consolidated Balance Sheets. The Company’s policy is to recognize interest and penalties on unrecognized tax benefits in income tax expense in the Consolidated Statements of Operations. No interest and penalties were recorded during the years ended September 30, 2013 and 2012. The tax years subject to examination by the taxing authorities are the years ended September 30, 2008 and forward. | |||||||||||||||||||||||||
Advertising Costs | ' | ||||||||||||||||||||||||
9. Advertising Costs | |||||||||||||||||||||||||
The Company expenses advertising costs as incurred. | |||||||||||||||||||||||||
Earnings Per Share | ' | ||||||||||||||||||||||||
10. Earnings Per Share | |||||||||||||||||||||||||
Basic income per share is calculated by dividing income available to common stockholders by the weighted average number of shares of common stock outstanding for the period. The weighted average common shares outstanding include shares held by the Magyar Bancorp, MHC and shares allocated to the Employee Stock Ownership Plan. | |||||||||||||||||||||||||
Diluted income per share is calculated by adjusting the weighted average common shares outstanding to reflect the potential dilution that could occur using the treasury stock method if securities or other contracts to issue common stock, such as stock options and unvested restricted stock, were exercised and converted into common stock. The resulting shares issued would share in the earnings of the Company. Shares issued and shares reacquired during the period are weighted for the portion of the period that they were outstanding. In periods of loss, dilution is not calculated and diluted loss per share is equal to basic loss per share. | |||||||||||||||||||||||||
The following tables illustrate the reconciliation of the numerators and denominators of the basic and diluted earnings per share (EPS) calculations. All options were anti-dilutive at September 30, 2012. | |||||||||||||||||||||||||
For the Years Ended September 30, | |||||||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||||||
Weighted | Per | Weighted | Per | ||||||||||||||||||||||
average | share | average | share | ||||||||||||||||||||||
Income | shares | Amount | Income | shares | Amount | ||||||||||||||||||||
(In thousands, except share and per share data) | |||||||||||||||||||||||||
Basic EPS | |||||||||||||||||||||||||
Net income available to common shareholders | $ | 262 | 5,810,910 | $ | 0.05 | $ | 509 | 5,810,294 | $ | 0.09 | |||||||||||||||
Effect of dilutive securities | |||||||||||||||||||||||||
Options and grants | — | 863 | — | — | — | — | |||||||||||||||||||
Diluted EPS | |||||||||||||||||||||||||
Net income available to common shareholders plus assumed conversion | $ | 262 | 5,811,773 | $ | 0.05 | $ | 509 | 5,810,294 | $ | 0.09 | |||||||||||||||
Comprehensive Income and Accumulated Other Comprehensive Income | ' | ||||||||||||||||||||||||
11 | Comprehensive Income and Accumulated Other Comprehensive Income | ||||||||||||||||||||||||
Comprehensive income includes net income as well as certain other items which result in a change to equity during the period. | |||||||||||||||||||||||||
The other items allocated to comprehensive income, as well as the related income tax effects, for the years ended September 30, 2013 and 2012 were as follows: | |||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||||||
Tax | Net of | Tax | Net of | ||||||||||||||||||||||
Before Tax | (Benefit) | Tax | Before Tax | (Benefit) | Tax | ||||||||||||||||||||
Amount | Expense | Amount | Amount | Expense | Amount | ||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||
Unrealized holding gains (losses) arising | |||||||||||||||||||||||||
during period on: | |||||||||||||||||||||||||
Available-for-sale investments | $ | (544 | ) | $ | 197 | $ | (347 | ) | $ | 276 | $ | (116 | ) | $ | 160 | ||||||||||
Less reclassification adjustment for net gains | |||||||||||||||||||||||||
realized on available-for-sale investments (a) (b) | (121 | ) | 48 | (73 | ) | (286 | ) | 114 | (172 | ) | |||||||||||||||
Defined benefit pension plan | 697 | (278 | ) | 419 | (222 | ) | 89 | (133 | ) | ||||||||||||||||
Interest rate derivatives | (54 | ) | 21 | (33 | ) | (87 | ) | 35 | (52 | ) | |||||||||||||||
Other comprehensive gain (loss), net | $ | (22 | ) | $ | (12 | ) | $ | (34 | ) | $ | (319 | ) | $ | 122 | $ | (197 | ) | ||||||||
(a) | Realized gains on securities transactions included in gains on sales of investment securities in the accompanying Consolidated Statements of Operations | ||||||||||||||||||||||||
(b) | Tax effect included in income tax expense in the accompanying Consolidated Statements of Operations | ||||||||||||||||||||||||
The components of accumulated other comprehensive loss at September 30, 2013 and 2012 were as follows: | |||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||
Available-for-sale investments | $ | (114 | ) | $ | 306 | ||||||||||||||||||||
Defined benefit pension plan | (524 | ) | (943 | ) | |||||||||||||||||||||
Interest rate derivatives | — | 33 | |||||||||||||||||||||||
Total accumulated other comprehensive loss | $ | (638 | ) | $ | (604 | ) | |||||||||||||||||||
Bank-Owned Life Insurance | ' | ||||||||||||||||||||||||
12 | Bank-Owned Life Insurance | ||||||||||||||||||||||||
The Company has purchased Bank-Owned Life Insurance policies (“BOLI”). BOLI involves the purchasing of life insurance by the Company on directors and executive officers. The proceeds are used to help defray the costs of non-qualified compensation plans. The Company is the owner and beneficiary of the policies. BOLI is recorded on the consolidated Balance Sheet at its cash surrender value and changes in the cash surrender value are recorded in non-interest income. | |||||||||||||||||||||||||
Segment Reporting | ' | ||||||||||||||||||||||||
13 | Segment Reporting | ||||||||||||||||||||||||
The Company acts as an independent, community, financial services provider, and offers traditional banking and related financial services to individual, business and government customers. The Company offers a full array of commercial and retail financial services, including the taking of time, savings and demand deposits; the making of commercial, consumer and home equity loans; and the provision of other financial services. | |||||||||||||||||||||||||
Management does not separately allocate expenses, including the cost of funding loan demand, between the commercial and retail operations of the Company. As such, discrete financial information is not available and segment reporting would not be meaningful. | |||||||||||||||||||||||||
New Accounting Pronouncements | ' | ||||||||||||||||||||||||
14 | New Accounting Pronouncements | ||||||||||||||||||||||||
In connection with the preparation of quarterly and annual reports in accordance with the Securities and Exchange Commission’s (SEC) Securities Exchange Act of 1934, SEC Staff Accounting Bulletin Topic 11.M requires the disclosure of the impact that recently issued accounting standards will have on financial statements when they are adopted in the future. | |||||||||||||||||||||||||
The FASB issued ASU 2011-04, Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs, to amend FASB ASC Topic 820, Fair Value Measurements, to bring U.S. GAAP for fair value measurements in line with International Accounting Standards. The ASU clarifies existing guidance for items such as: the application of the highest and best use concept to non-financial assets and liabilities; the application of fair value measurement to financial instruments classified in a reporting entity’s stockholder’s equity; and disclosure requirements regarding quantitative information about unobservable inputs used in the fair value measurements of level 3 assets. The ASU also creates an exception to Topic 820 for entities which carry financial instruments within a portfolio or group, under which the entity is now permitted to base the price used for fair valuation upon a price that would be received to sell the net asset position or transfer a net liability position in an orderly transaction. The ASU also allows for the application of premiums and discounts in a fair value measurement if the financial instrument is categorized in level 2 or 3 of the fair value hierarchy. Lastly, the ASU contains new disclosure requirements regarding fair value amounts categorized as level 3 in the fair value hierarchy such as: disclosure of the valuation process used; effects of and relationships between unobservable inputs; usage of nonfinancial assets for purposes other than their highest and best use when that is the basis of the disclosed fair value; and categorization by level of items disclosed at fair value, but not measured at fair value for financial statement purposes. This ASU was effective for interim and annual periods beginning after December 15, 2011. The updates to Topic 820 did not have a material impact on the Company’s consolidated financial statements. | |||||||||||||||||||||||||
In February 2013, the FASB issued ASU No. 2013-02, “Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income,” to improve the transparency of reporting these reclassifications. ASU No. 2013-02 does not amend any existing requirements for reporting net income or other comprehensive income in the financial statements. ASU No. 2013-02 requires an entity to disaggregate the total change of each component of other comprehensive income and separately present reclassification adjustments and current period other comprehensive income. The provisions of ASU No. 2013-02 also require that entities present in a single note or parenthetically on the face of the financial statements, the effect of significant amounts reclassified from each component of accumulated other comprehensive income based on its source and the income statement line item affected by the reclassification. If a component is not required to be reclassified to net income in its entirety, entities would instead cross-reference to the related note to the financial statements for additional information. The Company adopted the provisions of ASU No. 2013-02 effective January 1, 2013. As the Company provided these required disclosures in the notes to the Consolidated Financial Statements, the adoption of ASU No. 2013-02 had no impact on the Company’s consolidated statements of income and condition. See Note B. 11 to the Consolidated Financial Statements for the disclosures required by ASU No. 2013-02. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||||||||||||||
Schedule of reconciliation of the numerators and denominators of basic and diluted earnings per share | ' | ||||||||||||||||||||||||
The following tables illustrate the reconciliation of the numerators and denominators of the basic and diluted earnings per share (EPS) calculations. All options were anti-dilutive at September 30, 2012. | |||||||||||||||||||||||||
For the Years Ended September 30, | |||||||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||||||
Weighted | Per | Weighted | Per | ||||||||||||||||||||||
average | share | average | share | ||||||||||||||||||||||
Income | shares | Amount | Income | shares | Amount | ||||||||||||||||||||
(In thousands, except share and per share data) | |||||||||||||||||||||||||
Basic EPS | |||||||||||||||||||||||||
Net income available to common shareholders | $ | 262 | 5,810,910 | $ | 0.05 | $ | 509 | 5,810,294 | $ | 0.09 | |||||||||||||||
Effect of dilutive securities | |||||||||||||||||||||||||
Options and grants | — | 863 | — | — | — | — | |||||||||||||||||||
Diluted EPS | |||||||||||||||||||||||||
Net income available to common shareholders plus assumed conversion | $ | 262 | 5,811,773 | $ | 0.05 | $ | 509 | 5,810,294 | $ | 0.09 | |||||||||||||||
Schedule of other items allocated to comprehensive income (loss) | ' | ||||||||||||||||||||||||
The other items allocated to comprehensive income, as well as the related income tax effects, for the years ended September 30, 2013 and 2012 were as follows: | |||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||||||
Tax | Net of | Tax | Net of | ||||||||||||||||||||||
Before Tax | (Benefit) | Tax | Before Tax | (Benefit) | Tax | ||||||||||||||||||||
Amount | Expense | Amount | Amount | Expense | Amount | ||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||
Unrealized holding gains (losses) arising | |||||||||||||||||||||||||
during period on: | |||||||||||||||||||||||||
Available-for-sale investments | $ | (544 | ) | $ | 197 | $ | (347 | ) | $ | 276 | $ | (116 | ) | $ | 160 | ||||||||||
Less reclassification adjustment for net gains | |||||||||||||||||||||||||
realized on available-for-sale investments (a) (b) | (121 | ) | 48 | (73 | ) | (286 | ) | 114 | (172 | ) | |||||||||||||||
Defined benefit pension plan | 697 | (278 | ) | 419 | (222 | ) | 89 | (133 | ) | ||||||||||||||||
Interest rate derivatives | (54 | ) | 21 | (33 | ) | (87 | ) | 35 | (52 | ) | |||||||||||||||
Other comprehensive gain (loss), net | $ | (22 | ) | $ | (12 | ) | $ | (34 | ) | $ | (319 | ) | $ | 122 | $ | (197 | ) | ||||||||
(a) | Realized gains on securities transactions included in gains on sales of investment securities in the accompanying Consolidated Statements of Operations | ||||||||||||||||||||||||
(b) | Tax effect included in income tax expense in the accompanying Consolidated Statements of Operations | ||||||||||||||||||||||||
Schedule of components of accumulated other comprehensive loss | ' | ||||||||||||||||||||||||
The components of accumulated other comprehensive loss at September 30, 2013 and 2012 were as follows: | |||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||
Available-for-sale investments | $ | (114 | ) | $ | 306 | ||||||||||||||||||||
Defined benefit pension plan | (524 | ) | (943 | ) | |||||||||||||||||||||
Interest rate derivatives | — | 33 | |||||||||||||||||||||||
Total accumulated other comprehensive loss | $ | (638 | ) | $ | (604 | ) |
STOCKBASED_COMPENSATION_Tables
STOCK-BASED COMPENSATION (Tables) | 12 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Stock-Based Compensation Tables | ' | ||||||||||||||||
Schedule of entity's stock option activity and related information | ' | ||||||||||||||||
The following is a summary of the status of the Company’s stock option activity and related information for its option plan for the two-year period ended September 30, 2013: | |||||||||||||||||
Weighted | |||||||||||||||||
Weighted | Average | Aggregate | |||||||||||||||
Number of | Average | Remaining | Intrinsic | ||||||||||||||
Stock Options | Exercise Price | Contractual Life | Value | ||||||||||||||
Balance at September 30, 2011 | 188,276 | $ | 14.61 | 5.4 years | $ | — | |||||||||||
Granted | — | — | |||||||||||||||
Exercised | — | — | |||||||||||||||
Forfeited | — | $ | — | ||||||||||||||
Balance at September 30, 2012 | 188,276 | $ | 14.61 | 4.4 years | $ | — | |||||||||||
Granted | — | — | |||||||||||||||
Exercised | — | — | |||||||||||||||
Forfeited | — | — | |||||||||||||||
Balance at September 30, 2013 | 188,276 | $ | 14.61 | 3.4 years | $ | — | |||||||||||
Exercisable at September 30, 2013 | 188,276 | $ | 14.61 | 3.4 years | $ | — | |||||||||||
Summary of non-vested restricted shares | ' | ||||||||||||||||
The following is a summary of the status of the Company’s non-vested restricted shares as of September 30, 2013 and 2012, and changes during those years: | |||||||||||||||||
Weighted | |||||||||||||||||
Average | |||||||||||||||||
Number of | Grant Date | ||||||||||||||||
Stock Awards | Fair Value | ||||||||||||||||
Balance at September 30, 2011 | 33,145 | $ | 9.22 | ||||||||||||||
Granted | — | — | |||||||||||||||
Vested | (19,743 | ) | 12.48 | ||||||||||||||
Forfeited | — | — | |||||||||||||||
Balance at September 30, 2012 | 13,402 | 4.43 | |||||||||||||||
Granted | — | — | |||||||||||||||
Vested | (4,050 | ) | 4.44 | ||||||||||||||
Forfeited | — | — | |||||||||||||||
Balance at September 30, 2013 | 9,352 | $ | 4.42 | ||||||||||||||
Schedule of the components of the ESOP shares | ' | ||||||||||||||||
The following table presents the components of the ESOP shares as of September 30, 2013: | |||||||||||||||||
Unreleased shares at September 30, 2012 | 114,318 | ||||||||||||||||
Shares released for allocation during the year ended September 30, 2013 | (12,445 | ) | |||||||||||||||
Unreleased shares at September 30, 2013 | 101,873 | ||||||||||||||||
Total released shares | 115,990 | ||||||||||||||||
Total ESOP shares | 217,863 |
INVESTMENT_SECURITIES_Tables
INVESTMENT SECURITIES (Tables) | 12 Months Ended | ||||||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||||||
Investment Securities Tables | ' | ||||||||||||||||||||||||||||
Schedule amortized cost, gross unrealized gians or losses and fair values of investment securities available for sale and held to maturity | ' | ||||||||||||||||||||||||||||
The unamortized cost, gross unrealized gains or losses and fair value of the Company’s investment securities available-for-sale and held-to-maturity are as follows: | |||||||||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||||||
Gross | Gross | ||||||||||||||||||||||||||||
Amortized | Unrealized | Unrealized | Fair | ||||||||||||||||||||||||||
Cost | Gains | Losses | Value | ||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||
Securities available-for-sale: | |||||||||||||||||||||||||||||
Obligations of U.S. government agencies: | |||||||||||||||||||||||||||||
Mortgage-backed securities - residential | $ | 1,551 | $ | 5 | $ | — | $ | 1,556 | |||||||||||||||||||||
Obligations of U.S. government-sponsored enterprises: | |||||||||||||||||||||||||||||
Mortgage-backed securities - residential | 9,633 | 9 | (241 | ) | 9,401 | ||||||||||||||||||||||||
Mortgage-backed securities - commercial | 3,963 | 39 | — | 4,002 | |||||||||||||||||||||||||
Private label mortgage-backed securities - residential | 808 | 9 | (2 | ) | 815 | ||||||||||||||||||||||||
Total securities available-for-sale | 15,955 | 62 | (243 | ) | 15,774 | ||||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||||||
Gross | Gross | ||||||||||||||||||||||||||||
Amortized | Unrealized | Unrealized | Fair | ||||||||||||||||||||||||||
Cost | Gains | Losses | Value | ||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||
Securities held-to-maturity: | |||||||||||||||||||||||||||||
Obligations of U.S. government agencies: | |||||||||||||||||||||||||||||
Mortgage-backed securities - residential | $ | 9,455 | $ | 231 | $ | (121 | ) | $ | 9,565 | ||||||||||||||||||||
Mortgage-backed securities - commercial | 1,433 | — | (3 | ) | 1,430 | ||||||||||||||||||||||||
Obligations of U.S. government-sponsored enterprises: | |||||||||||||||||||||||||||||
Mortgage-backed securities - residential | 33,758 | 363 | (975 | ) | 33,146 | ||||||||||||||||||||||||
Debt securities | 4,000 | — | (267 | ) | 3,733 | ||||||||||||||||||||||||
Private label mortgage-backed securities - residential | 901 | 27 | (11 | ) | 917 | ||||||||||||||||||||||||
Obligations of state and political subdivisions | 11 | — | — | 11 | |||||||||||||||||||||||||
Corporate securities | 3,000 | — | — | 3,000 | |||||||||||||||||||||||||
Total securities held-to-maturity | 52,558 | 621 | (1,377 | ) | 51,802 | ||||||||||||||||||||||||
At September 30, 2012 | |||||||||||||||||||||||||||||
Gross | Gross | ||||||||||||||||||||||||||||
Amortized | Unrealized | Unrealized | Fair | ||||||||||||||||||||||||||
Cost | Gains | Losses | Value | ||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||
Securities available-for-sale: | |||||||||||||||||||||||||||||
Obligations of U.S. government agencies: | |||||||||||||||||||||||||||||
Mortgage-backed securities - residential | $ | 1,850 | $ | 11 | $ | — | $ | 1,861 | |||||||||||||||||||||
Obligations of U.S. government-sponsored enterprises: | |||||||||||||||||||||||||||||
Mortgage-backed securities - residential | 8,368 | 207 | — | 8,575 | |||||||||||||||||||||||||
Mortgage-backed securities - commercial | 4,053 | 175 | — | 4,228 | |||||||||||||||||||||||||
Debt securities | 1,000 | 67 | — | 1,067 | |||||||||||||||||||||||||
Private label mortgage-backed securities - residential | 1,031 | 25 | (1 | ) | 1,055 | ||||||||||||||||||||||||
Total securities available-for-sale | $ | 16,302 | $ | 485 | $ | (1 | ) | $ | 16,786 | ||||||||||||||||||||
At September 30, 2012 | |||||||||||||||||||||||||||||
Gross | Gross | ||||||||||||||||||||||||||||
Amortized | Unrealized | Unrealized | Fair | ||||||||||||||||||||||||||
Cost | Gains | Losses | Value | ||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||
Securities held-to-maturity: | |||||||||||||||||||||||||||||
Obligations of U.S. government agencies: | |||||||||||||||||||||||||||||
Mortgage-backed securities - residential | $ | 10,790 | $ | 414 | $ | (8 | ) | $ | 11,196 | ||||||||||||||||||||
Mortgage-backed securities - commercial | 1,522 | 14 | — | 1,536 | |||||||||||||||||||||||||
Obligations of U.S. government-sponsored enterprises: | |||||||||||||||||||||||||||||
Mortgage-backed securities - residential | 18,578 | 722 | (5 | ) | 19,295 | ||||||||||||||||||||||||
Debt securities | 5,770 | 6 | — | 5,776 | |||||||||||||||||||||||||
Private label mortgage-backed securities - residential | 1,367 | 27 | — | 1,394 | |||||||||||||||||||||||||
Obligations of state and political subdivisions | 41 | 1 | — | 42 | |||||||||||||||||||||||||
Corporate securities | 3,000 | — | (109 | ) | 2,891 | ||||||||||||||||||||||||
Total securities held-to-maturity | $ | 41,068 | $ | 1,184 | $ | (122 | ) | $ | 42,130 | ||||||||||||||||||||
Schedule of maturities of the debt securities and mortgage-backed securities available-for-sale and held to maturity | ' | ||||||||||||||||||||||||||||
The contractual maturities of mortgage-backed securities generally exceed 10 years; however, the effective lives are expected to be shorter due to anticipated prepayments. The amortized cost and fair value of the Company’s securities available-for-sale at September 30, 2013 are summarized in the following table: | |||||||||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||||||
Amortized | Fair | ||||||||||||||||||||||||||||
Cost | Value | ||||||||||||||||||||||||||||
Total debt securities | $ | — | $ | — | |||||||||||||||||||||||||
Mortgage-backed securities: | |||||||||||||||||||||||||||||
Residential(1) | 11,992 | 11,772 | |||||||||||||||||||||||||||
Commercial(2) | 3,963 | 4,002 | |||||||||||||||||||||||||||
Total | $ | 15,955 | $ | 15,774 | |||||||||||||||||||||||||
-1 | Available-for-sale mortgage-backed securities – residential include an amortized cost of $1.6 million and a fair value of $1.6 million for obligations of U.S. government agencies issued by the Government National Mortgage Association and obligations of U.S. government-sponsored enterprises issued by Federal National Mortgage Association and Federal Home Loan Mortgage Corporation which had an amortized cost of $9.6 million and a fair value of $9.4 million. Also included are residential mortgage-backed securities issued by non-U.S. government agencies and government-sponsored enterprises with an amortized cost of $808,000 and fair value of $815,000. | ||||||||||||||||||||||||||||
-2 | Available-for-sale mortgage-backed securities – commercial include an amortized cost of $4.0 million and a fair value of $4.0 million for obligations of U.S. government-sponsored enterprises issued by the Federal National Mortgage Association. | ||||||||||||||||||||||||||||
The maturities of the debt securities and the mortgage-backed securities held to maturity at September 30, 2013 are summarized in the following table: | |||||||||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||||||
Amortized | Fair | ||||||||||||||||||||||||||||
Cost | Value | ||||||||||||||||||||||||||||
Due within 1 year | $ | 11 | $ | 11 | |||||||||||||||||||||||||
Due after 1 but within 5 years | 3,000 | 3,000 | |||||||||||||||||||||||||||
Due after 5 but within 10 years | 1,000 | 921 | |||||||||||||||||||||||||||
Due after 10 years | 3,000 | 2,812 | |||||||||||||||||||||||||||
Total debt securities | 7,011 | 6,744 | |||||||||||||||||||||||||||
Mortgage-backed securities: | |||||||||||||||||||||||||||||
Residential(1) | 44,114 | 43,628 | |||||||||||||||||||||||||||
Commercial(2) | 1,433 | 1,430 | |||||||||||||||||||||||||||
Total | $ | 52,558 | $ | 51,802 | |||||||||||||||||||||||||
-1 | Held-to-maturity mortgage-backed securities – residential include an amortized cost of $9.5 million and a fair value of $9.6 million for obligations of U.S. government agencies issued by the Government National Mortgage Association and obligations of U.S. government-sponsored enterprises issued by Federal National Mortgage Association and Federal Home Loan Mortgage Corporation which had an amortized cost of $33.8 million and a fair value of $33.1 million. Also included are mortgage-backed securities issued by non-U.S. government agencies and government-sponsored enterprises with an amortized cost of $901,000 and a fair value of $917,000. | ||||||||||||||||||||||||||||
-2 | Held-to-maturity mortgage-backed securities – commercial include an amortized cost of $1.4 million and a fair value of $1.4 million for obligations of U.S. government agencies issued by the Small Business Administration. | ||||||||||||||||||||||||||||
Schedule of securities with unrealized losses | ' | ||||||||||||||||||||||||||||
Details of securities with unrealized losses at September 30, 2013 and 2012 are as follows: | |||||||||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||||||
Less Than 12 Months | 12 Months Or Greater | Total | |||||||||||||||||||||||||||
Number of | Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||||||||||
Securities | Value | Losses | Value | Losses | Value | Losses | |||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||
Obligations of U.S. government agencies: | |||||||||||||||||||||||||||||
Mortgage-backed securities - residential | 3 | $ | 1,887 | $ | (57 | ) | $ | 1,099 | $ | (64 | ) | $ | 2,986 | $ | (121 | ) | |||||||||||||
Mortgage-backed securities - commercial | 1 | 1,430 | (3 | ) | — | — | 1,430 | (3 | ) | ||||||||||||||||||||
Obligations of U.S. government-sponsored enterprises | |||||||||||||||||||||||||||||
Mortgage-backed securities - residential | 22 | 30,638 | (1,202 | ) | 626 | (14 | ) | 31,264 | (1,216 | ) | |||||||||||||||||||
Debt securities | 4 | 3,732 | (267 | ) | — | — | 3,732 | (267 | ) | ||||||||||||||||||||
Private label mortgage-backed securities - residential | 2 | 396 | (11 | ) | 21 | (2 | ) | 417 | (13 | ) | |||||||||||||||||||
Corporate securities | 1 | 3,000 | — | — | — | 3,000 | — | ||||||||||||||||||||||
Total | 33 | $ | 41,083 | $ | (1,540 | ) | $ | 1,746 | $ | (80 | ) | $ | 42,829 | $ | (1,620 | ) | |||||||||||||
30-Sep-12 | |||||||||||||||||||||||||||||
Less Than 12 Months | 12 Months Or Greater | Total | |||||||||||||||||||||||||||
Number of | Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||||||||||
Securities | Value | Losses | Value | Losses | Value | Losses | |||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||
Obligations of U.S. government agencies: | |||||||||||||||||||||||||||||
Mortgage-backed securities - residential | 1 | $ | — | $ | — | $ | 1,729 | $ | (8 | ) | $ | 1,729 | $ | (8 | ) | ||||||||||||||
Obligations of U.S. government-sponsored enterprises | |||||||||||||||||||||||||||||
Mortgage-backed securities - residential | 1 | 1,143 | (5 | ) | — | — | 1,143 | (5 | ) | ||||||||||||||||||||
Private label mortgage-backed securities - residential | 3 | — | — | 26 | (1 | ) | 26 | (1 | ) | ||||||||||||||||||||
Corporate securities | 1 | — | — | 2,891 | (109 | ) | 2,891 | (109 | ) | ||||||||||||||||||||
Total | 6 | $ | 1,143 | $ | (5 | ) | $ | 4,646 | $ | (118 | ) | $ | 5,789 | $ | (123 | ) | |||||||||||||
The investment securities listed above currently have fair values less than amortized cost and therefore contain unrealized losses. The Company evaluated these securities and determined that the decline in value was primarily related to fluctuations in the interest rate environment and were not related to any company or industry specific event. | |||||||||||||||||||||||||||||
The Company anticipates full recovery of amortized costs with respect to these securities. The Company does not intend to sell these securities and has determined that it is not more likely than not that the Company would be required to sell these securities prior to maturity or market price recovery. Management has considered factors regarding other than temporarily impaired securities and determined that there are no securities with impairment that is other than temporary as of September 30, 2013 and 2012. |
LOANS_RECEIVABLE_NET_Tables
LOANS RECEIVABLE, NET (Tables) | 12 Months Ended | ||||||||||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||||||||||
Loans Receivable Net Tables | ' | ||||||||||||||||||||||||||||||||
Schedule of net Loans | ' | ||||||||||||||||||||||||||||||||
Loans receivable are comprised of the following: | |||||||||||||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
One-to four-family residential | $ | 152,977 | $ | 157,536 | |||||||||||||||||||||||||||||
Commercial real estate | 163,368 | 148,806 | |||||||||||||||||||||||||||||||
Construction | 16,749 | 17,952 | |||||||||||||||||||||||||||||||
Home equity lines of credit | 20,349 | 23,435 | |||||||||||||||||||||||||||||||
Commercial business | 34,492 | 29,930 | |||||||||||||||||||||||||||||||
Other | 11,631 | 11,265 | |||||||||||||||||||||||||||||||
Total loans receivable | 399,566 | 388,924 | |||||||||||||||||||||||||||||||
Net deferred loan costs | 247 | 204 | |||||||||||||||||||||||||||||||
Allowance for loan losses | (3,013 | ) | (3,858 | ) | |||||||||||||||||||||||||||||
Total loans receivable, net | $ | 396,800 | $ | 385,270 | |||||||||||||||||||||||||||||
Schedule of impaired loans | ' | ||||||||||||||||||||||||||||||||
The following tables present impaired loans by class, segregated by those for which a specific allowance was required and those for which a specific allowance was not necessary for the periods presented: | |||||||||||||||||||||||||||||||||
Impaired Loans | |||||||||||||||||||||||||||||||||
Impaired Loans with | with No Specific | ||||||||||||||||||||||||||||||||
Specific Allowance | Allowance | Total Impaired Loans | |||||||||||||||||||||||||||||||
Unpaid | |||||||||||||||||||||||||||||||||
At and for the year ended | Recorded | Related | Recorded | Recorded | Principal | ||||||||||||||||||||||||||||
30-Sep-13 | Investment | Allowance | Investment | Investment | Balance | ||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
One-to four-family residential | $ | 6,192 | $ | 513 | $ | 8,478 | $ | 14,670 | $ | 15,631 | |||||||||||||||||||||||
Commercial real estate | 421 | 7 | 5,599 | 6,020 | 7,179 | ||||||||||||||||||||||||||||
Construction | 600 | 11 | 2,896 | 3,496 | 4,953 | ||||||||||||||||||||||||||||
Home equity lines of credit | — | — | 1,027 | 1,027 | 1,268 | ||||||||||||||||||||||||||||
Commercial business | 11 | 11 | 84 | 95 | 116 | ||||||||||||||||||||||||||||
Other | — | — | — | — | — | ||||||||||||||||||||||||||||
Total impaired loans | $ | 7,224 | $ | 542 | $ | 18,084 | $ | 25,308 | $ | 29,147 | |||||||||||||||||||||||
Impaired Loans | |||||||||||||||||||||||||||||||||
Impaired Loans with | with No Specific | ||||||||||||||||||||||||||||||||
Specific Allowance | Allowance | Total Impaired Loans | |||||||||||||||||||||||||||||||
Unpaid | |||||||||||||||||||||||||||||||||
At and for the year ended | Recorded | Related | Recorded | Recorded | Principal | ||||||||||||||||||||||||||||
30-Sep-12 | Investment | Allowance | Investment | Investment | Balance | ||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
One-to four-family residential | $ | — | $ | — | $ | 7,124 | $ | 7,124 | $ | 7,594 | |||||||||||||||||||||||
Commercial real estate | 3,999 | 798 | 2,425 | 6,424 | 7,204 | ||||||||||||||||||||||||||||
Construction | — | — | 5,141 | 5,141 | 6,927 | ||||||||||||||||||||||||||||
Home equity lines of credit | 1,340 | 122 | 967 | 2,307 | 2,475 | ||||||||||||||||||||||||||||
Commercial business | — | — | 57 | 57 | 57 | ||||||||||||||||||||||||||||
Other | 12 | 12 | — | 12 | 12 | ||||||||||||||||||||||||||||
Total impaired loans | $ | 5,351 | $ | 932 | $ | 15,714 | $ | 21,065 | $ | 24,269 | |||||||||||||||||||||||
Schedule of loan portfolio summarized by Bank's internal risk rating system | ' | ||||||||||||||||||||||||||||||||
The following table presents the classes of the loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the Bank’s internal risk rating system for the period presented: | |||||||||||||||||||||||||||||||||
Special | |||||||||||||||||||||||||||||||||
Pass | Mention | Substandard | Doubtful | Total | |||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||||||||||
One-to four-family residential | $ | 141,881 | $ | 346 | $ | 10,750 | $ | — | $ | 152,977 | |||||||||||||||||||||||
Commercial real estate | 156,511 | 1,128 | 5,729 | — | 163,368 | ||||||||||||||||||||||||||||
Construction | 8,839 | — | 7,910 | — | 16,749 | ||||||||||||||||||||||||||||
Home equity lines of credit | 17,988 | — | 2,361 | — | 20,349 | ||||||||||||||||||||||||||||
Commercial business | 32,905 | 466 | 1,121 | — | 34,492 | ||||||||||||||||||||||||||||
Other | 11,631 | — | — | — | 11,631 | ||||||||||||||||||||||||||||
Total | $ | 369,755 | $ | 1,940 | $ | 27,871 | $ | — | $ | 399,566 | |||||||||||||||||||||||
Special | |||||||||||||||||||||||||||||||||
Pass | Mention | Substandard | Doubtful | Total | |||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
30-Sep-12 | |||||||||||||||||||||||||||||||||
One-to four-family residential | $ | 146,487 | $ | 3,925 | $ | 7,124 | $ | — | $ | 157,536 | |||||||||||||||||||||||
Commercial real estate | 137,616 | 3,063 | 6,448 | 1,679 | 148,806 | ||||||||||||||||||||||||||||
Construction | 8,274 | 4,537 | 5,141 | — | 17,952 | ||||||||||||||||||||||||||||
Home equity lines of credit | 20,295 | 833 | 967 | 1,340 | 23,435 | ||||||||||||||||||||||||||||
Commercial business | 26,057 | 3,151 | 722 | — | 29,930 | ||||||||||||||||||||||||||||
Other | 11,253 | — | 12 | — | 11,265 | ||||||||||||||||||||||||||||
Total | $ | 349,982 | $ | 15,509 | $ | 20,414 | $ | 3,019 | $ | 388,924 | |||||||||||||||||||||||
Schedule of aging analysis of past due loans, segregated by class of loans | ' | ||||||||||||||||||||||||||||||||
The following table presents the classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans for the period presented: | |||||||||||||||||||||||||||||||||
30-59 | 60-89 | ||||||||||||||||||||||||||||||||
Days | Days | 90 Days + | Total | Non- | Total | ||||||||||||||||||||||||||||
Current | Past Due | Past Due | Past Due | Past Due | Accrual | Loans | |||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||||||||||
One-to four-family residential | $ | 144,084 | $ | — | $ | 378 | $ | 8,515 | $ | 8,893 | $ | 8,515 | $ | 152,977 | |||||||||||||||||||
Commercial real estate | 160,624 | — | — | 2,744 | 2,744 | 2,744 | 163,368 | ||||||||||||||||||||||||||
Construction | 13,223 | — | — | 3,526 | 3,526 | 3,526 | 16,749 | ||||||||||||||||||||||||||
Home equity lines of credit | 19,253 | 250 | — | 846 | 1,096 | 846 | 20,349 | ||||||||||||||||||||||||||
Commercial business | 34,467 | — | — | 25 | 25 | 25 | 34,492 | ||||||||||||||||||||||||||
Other | 11,631 | — | — | — | — | — | 11,631 | ||||||||||||||||||||||||||
Total | $ | 383,282 | $ | 250 | $ | 378 | $ | 15,656 | $ | 16,284 | $ | 15,656 | $ | 399,566 | |||||||||||||||||||
30-59 | 60-89 | ||||||||||||||||||||||||||||||||
Days | Days | 90 Days + | Total | Non- | Total | ||||||||||||||||||||||||||||
Current | Past Due | Past Due | Past Due | Past Due | Accrual | Loans | |||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
30-Sep-12 | |||||||||||||||||||||||||||||||||
One-to four-family residential | $ | 147,749 | $ | 621 | $ | 1,589 | $ | 7,577 | $ | 9,787 | $ | 7,577 | $ | 157,536 | |||||||||||||||||||
Commercial real estate | 141,674 | — | 708 | 6,424 | 7,132 | 6,424 | 148,806 | ||||||||||||||||||||||||||
Construction | 12,811 | — | — | 5,141 | 5,141 | 5,141 | 17,952 | ||||||||||||||||||||||||||
Home equity lines of credit | 22,353 | 160 | 59 | 863 | 1,082 | 863 | 23,435 | ||||||||||||||||||||||||||
Commercial business | 29,761 | 10 | 102 | 57 | 169 | 57 | 29,930 | ||||||||||||||||||||||||||
Other | 11,253 | — | — | 12 | 12 | 12 | 11,265 | ||||||||||||||||||||||||||
Total | $ | 365,601 | $ | 791 | $ | 2,458 | $ | 20,074 | $ | 23,323 | $ | 20,074 | $ | 388,924 | |||||||||||||||||||
Schedule of activity in the allowance for loan losses by portfolio segment | ' | ||||||||||||||||||||||||||||||||
The following tables summarize the activity in the allowance for loan losses by loan category for the years ended September 30, 2013 and 2012: | |||||||||||||||||||||||||||||||||
One-to Four- | Home Equity | ||||||||||||||||||||||||||||||||
Family | Commercial | Lines of | Commercial | ||||||||||||||||||||||||||||||
Residential | Real Estate | Construction | Credit | Business | Other | Unallocated | Total | ||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
Balance - September 30, 2012 | $ | 610 | $ | 1,929 | $ | 640 | $ | 232 | $ | 383 | $ | 23 | $ | 41 | $ | 3,858 | |||||||||||||||||
Charge-offs | (478 | ) | (576 | ) | (1,374 | ) | (13 | ) | (806 | ) | (13 | ) | — | (3,260 | ) | ||||||||||||||||||
Recoveries | — | 20 | 284 | — | — | — | — | 304 | |||||||||||||||||||||||||
Provision | 712 | (521 | ) | 1,054 | (95 | ) | 875 | (1 | ) | 86 | 2,111 | ||||||||||||||||||||||
Balance-September 30, 2013 | $ | 844 | $ | 852 | $ | 604 | $ | 125 | $ | 452 | $ | 9 | $ | 127 | $ | 3,013 | |||||||||||||||||
One-to Four- | Home Equity | ||||||||||||||||||||||||||||||||
Family | Commercial | Lines of | Commercial | ||||||||||||||||||||||||||||||
Residential | Real Estate | Construction | Credit | Business | Other | Unallocated | Total | ||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
Balance- September 30, 2011 | $ | 734 | $ | 1,266 | $ | 1,043 | $ | 101 | $ | 551 | $ | 13 | $ | 104 | $ | 3,812 | |||||||||||||||||
Charge-offs | (326 | ) | (110 | ) | (880 | ) | (81 | ) | (69 | ) | — | — | (1,466 | ) | |||||||||||||||||||
Recoveries | — | — | 51 | — | — | — | — | 51 | |||||||||||||||||||||||||
Provision | 202 | 773 | 426 | 212 | (99 | ) | 10 | (63 | ) | 1,461 | |||||||||||||||||||||||
Balance - September 30, 2012 | $ | 610 | $ | 1,929 | $ | 640 | $ | 232 | $ | 383 | $ | 23 | $ | 41 | $ | 3,858 | |||||||||||||||||
The following tables summarize the ALL by loan category, segregated into the amount required for loans individually evaluated for impairment and the amount required for loans collectively evaluated for impairment as of September 30, 2013 and September 30, 2012: | |||||||||||||||||||||||||||||||||
One-to Four- | Home Equity | ||||||||||||||||||||||||||||||||
Family | Commercial | Lines of | Commercial | ||||||||||||||||||||||||||||||
Residential | Real Estate | Construction | Credit | Business | Other | Unallocated | Total | ||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
Allowance for Loan Losses: | |||||||||||||||||||||||||||||||||
Balance - September 30, 2013 | $ | 844 | $ | 852 | $ | 604 | $ | 125 | $ | 452 | $ | 9 | $ | 127 | $ | 3,013 | |||||||||||||||||
Individually evaluated | |||||||||||||||||||||||||||||||||
for impairment | 513 | 7 | 11 | — | 11 | — | — | 542 | |||||||||||||||||||||||||
Collectively evaluated | |||||||||||||||||||||||||||||||||
for impairment | 331 | 845 | 593 | 125 | 441 | 9 | 127 | 2,471 | |||||||||||||||||||||||||
Loans receivable: | |||||||||||||||||||||||||||||||||
Balance - September 30, 2013 | $ | 152,977 | $ | 163,368 | $ | 16,749 | $ | 20,349 | $ | 34,492 | $ | 11,631 | $ | 399,566 | |||||||||||||||||||
Individually evaluated | |||||||||||||||||||||||||||||||||
for impairment | 14,670 | 6,020 | 3,496 | 1,027 | 95 | — | 25,308 | ||||||||||||||||||||||||||
Collectively evaluated | |||||||||||||||||||||||||||||||||
for impairment | 138,307 | 157,348 | 13,253 | 19,322 | 34,397 | 11,631 | 374,258 | ||||||||||||||||||||||||||
One-to Four- | Home Equity | ||||||||||||||||||||||||||||||||
Family | Commercial | Lines of | Commercial | ||||||||||||||||||||||||||||||
Residential | Real Estate | Construction | Credit | Business | Other | Unallocated | Total | ||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
Allowance for Loan Losses: | |||||||||||||||||||||||||||||||||
Balance- September 30, 2012 | $ | 610 | $ | 1,929 | $ | 640 | $ | 232 | $ | 383 | $ | 23 | $ | 41 | $ | 3,858 | |||||||||||||||||
Individually evaluated | |||||||||||||||||||||||||||||||||
for impairment | — | 798 | — | 122 | — | 12 | — | 932 | |||||||||||||||||||||||||
Collectively evaluated | |||||||||||||||||||||||||||||||||
for impairment | 610 | 1,131 | 640 | 110 | 383 | 11 | 41 | 2,926 | |||||||||||||||||||||||||
Loans receivable: | |||||||||||||||||||||||||||||||||
Balance - September 30, 2012 | $ | 157,536 | $ | 148,806 | $ | 17,952 | $ | 23,435 | $ | 29,930 | $ | 11,265 | $ | 388,924 | |||||||||||||||||||
Individually evaluated | |||||||||||||||||||||||||||||||||
for impairment | 7,124 | 6,424 | 5,141 | 2,307 | 57 | 12 | 21,065 | ||||||||||||||||||||||||||
Collectively evaluated | |||||||||||||||||||||||||||||||||
for impairment | 150,412 | 142,382 | 12,811 | 21,128 | 29,873 | 11,253 | 367,859 | ||||||||||||||||||||||||||
Schedule of troubled debt restructurings | ' | ||||||||||||||||||||||||||||||||
There were eight TDRs during the year ended September 30, 2013. These were classified as TDRs due to financial difficulty of the borrowers and lower than market interest rates. The following table summarizes the TDRs during the twelve month period ended September 30, 2013 and 2012: | |||||||||||||||||||||||||||||||||
Year Ended September 30, 2013 | |||||||||||||||||||||||||||||||||
Number of | Investment Before | Investment After | |||||||||||||||||||||||||||||||
Loans | TDR Modification | TDR Modification | |||||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
One-to four-family residential | 7 | $ | 1,170 | $ | 1,168 | ||||||||||||||||||||||||||||
Commercial real estate | 1 | 693 | 995 | ||||||||||||||||||||||||||||||
Construction | — | — | — | ||||||||||||||||||||||||||||||
Home equity lines of credit | — | — | — | ||||||||||||||||||||||||||||||
Commercial business | — | — | — | ||||||||||||||||||||||||||||||
Other | — | — | — | ||||||||||||||||||||||||||||||
Total | 8 | $ | 1,863 | $ | 2,163 | ||||||||||||||||||||||||||||
Year Ended September 30, 2012 | |||||||||||||||||||||||||||||||||
Number of | Investment Before | Investment After | |||||||||||||||||||||||||||||||
Loans | TDR Modification | TDR Modification | |||||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
One-to four-family residential | 6 | $ | 2,336 | $ | 2,336 | ||||||||||||||||||||||||||||
Commercial real estate | 4 | 3,269 | 2,325 | ||||||||||||||||||||||||||||||
Construction | — | — | — | ||||||||||||||||||||||||||||||
Home equity lines of credit | — | — | — | ||||||||||||||||||||||||||||||
Commercial business | — | — | — | ||||||||||||||||||||||||||||||
Other | — | — | — | ||||||||||||||||||||||||||||||
Total | 10 | $ | 5,605 | $ | 4,661 |
ACCRUED_INTEREST_RECEIVABLE_Ta
ACCRUED INTEREST RECEIVABLE (Tables) | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Accrued Interest Receivable Tables | ' | ||||||||
Summary of accrued interest receivable | ' | ||||||||
The following is a summary of accrued interest receivable: | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
(Dollars in thousands) | |||||||||
Loans | $ | 1,563 | $ | 1,686 | |||||
Investment securities | 51 | 91 | |||||||
Mortgage-backed securities | 138 | 117 | |||||||
Total accrued interest receivable | $ | 1,752 | $ | 1,894 |
PREMISES_AND_EQUIPMENT_Tables
PREMISES AND EQUIPMENT (Tables) | 12 Months Ended | ||||||||||
Sep. 30, 2013 | |||||||||||
Property, Plant and Equipment [Abstract] | ' | ||||||||||
Schedule of premises and equipment | ' | ||||||||||
Premises and equipment consist of the following: | |||||||||||
Estimated | September 30, | ||||||||||
Useful Lives | 2013 | 2012 | |||||||||
(Dollars in thousands) | |||||||||||
Land | Indefinite | $ | 5,330 | $ | 5,330 | ||||||
Buildings and improvements | 10-40 years | 21,382 | 21,811 | ||||||||
Furniture, fixtures and equipment | 5-10 years | 2,673 | 2,512 | ||||||||
29,385 | 29,653 | ||||||||||
Less accumulated depreciation and amortization | (8,505 | ) | (8,112 | ) | |||||||
$ | 20,880 | $ | 21,541 |
DEPOSITS_Tables
DEPOSITS (Tables) | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Deposits Tables | ' | ||||||||
Schedule of deposits by type of account | ' | ||||||||
A summary of deposits by type of account follows: | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
(Dollars in thousands) | |||||||||
Demand accounts | $ | 98,345 | $ | 50,897 | |||||
Savings accounts | 53,291 | 55,293 | |||||||
NOW accounts | 40,500 | 44,312 | |||||||
Money market accounts | 107,351 | 107,555 | |||||||
Certificate of deposit | 125,696 | 129,716 | |||||||
Retirement accounts | 28,145 | 28,745 | |||||||
$ | 453,328 | $ | 416,518 | ||||||
Schedule of contractual maturities of certificates of deposit | ' | ||||||||
At September 30, 2013, certificates of deposit (including retirement accounts) have contractual maturities as follows (in thousands): | |||||||||
Year Ending September 30, | |||||||||
2014 | $ | 96,684 | |||||||
2015 | 27,727 | ||||||||
2016 | 14,225 | ||||||||
2017 | 7,856 | ||||||||
2018 | 11,606 | ||||||||
Thereafter | 649 | ||||||||
$ | 158,747 |
BORROWINGS_Tables
BORROWINGS (Tables) | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Debt Disclosure [Abstract] | ' | ||||||||
Schedule of maturities of FHLBNY advances | ' | ||||||||
Long term FHLBNY advances as of September 30, 2013 mature as follows (in thousands): | |||||||||
Year Ending September 30, | |||||||||
2014 | $ | 8,700 | |||||||
2015 | 5,000 | ||||||||
2016 | 2,260 | ||||||||
2017 | 3,000 | ||||||||
2018 | 4,000 | ||||||||
Thereafter | 4,140 | ||||||||
$ | 27,100 | ||||||||
Schedule of short-term arrangements with the FHLBNY | ' | ||||||||
Information concerning short-term arrangements with the FHLBNY is summarized as follows: | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
(Dollars in thousands) | |||||||||
Balance at end of year | $ | — | $ | 1,400 | |||||
Weighted average balance during the year | $ | 2,721 | $ | 911 | |||||
Maximum month-end balance during the year | $ | 15,500 | $ | 8,750 | |||||
Average interest rate during the year | 0.39% | 0.38% | |||||||
SERVICING_POLICY_Tables
SERVICING POLICY (Tables) | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Servicing Policy Tables | ' | ||||||||
Schedule of activity in mortgage servicing rights | ' | ||||||||
Activity in mortgage servicing rights during the years ended September 30, 2013 and 2012 are summarized as follows: | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
(Dollars in thousands) | |||||||||
Beginning balance | $ | 279 | $ | 235 | |||||
Origination of mortgage servicing rights | 20 | 141 | |||||||
Amortization | (70 | ) | (97 | ) | |||||
Ending balance | $ | 229 | $ | 279 |
INCOME_TAXES_Tables
INCOME TAXES (Tables) | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Income Taxes Tables | ' | ||||||||
Schedule of components of income tax expense | ' | ||||||||
The income tax expense is comprised of the following components for the years ended September 30, 2013 and 2012: | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
(Dollars in thousands) | |||||||||
Current | $ | (63 | ) | $ | 20 | ||||
Deferred | 84 | 101 | |||||||
Total income tax expense | $ | 21 | $ | 121 | |||||
Schedule of reconciliation of income tax at the statutory rate to effective tax rate | ' | ||||||||
A reconciliation of income tax at the statutory tax rate to the effective income tax expense for the years ended September 30, 2013 and 2012 is as follows: | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
(Dollars in thousands) | |||||||||
Income tax expense (benefit) at statutory rate | $ | 97 | $ | 214 | |||||
Increase (decrease) resulting from: | |||||||||
State income taxes, net of federal income tax benefit | 5 | 34 | |||||||
Tax-exempt income, net | (108 | ) | (112 | ) | |||||
Nondeductible expenses | 3 | 4 | |||||||
Share based compensation | — | 14 | |||||||
Employee stock ownership plan | (25 | ) | (32 | ) | |||||
Increase (decrease) in valuation allowance | 49 | (26 | ) | ||||||
Other, net | — | 25 | |||||||
Total income tax expense | $ | 21 | $ | 121 | |||||
Schedule of major sources of temporary differences and their deferred tax effect | ' | ||||||||
The major sources of temporary differences and their deferred tax effect at September 30, 2013 and 2012 are as follows: | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
(Dollars in thousands) | |||||||||
Allowance for loan losses | $ | 1,203 | $ | 1,541 | |||||
Deferred loan fees | 1,067 | 1,016 | |||||||
Employee benefits | 295 | 299 | |||||||
Charitable contributions | 18 | 13 | |||||||
Net operating losses | 1,912 | 1,727 | |||||||
Alternative minimum tax credit | 176 | 247 | |||||||
Unrealized loss, minimum pension liability | 348 | 627 | |||||||
Net unrealized losses, investment securities available-for-sale | 67 | — | |||||||
OREO | 297 | 319 | |||||||
Straight line rent | 118 | 93 | |||||||
Gross deferred tax asset | 5,501 | 5,882 | |||||||
Depreciation | (1,469 | ) | (1,573 | ) | |||||
Discount accretion on investments | (95 | ) | (107 | ) | |||||
Net unrealized gains, investment securities available-for-sale | — | (178 | ) | ||||||
Unrealized gain, derivative contracts | — | (22 | ) | ||||||
Mortgage servicing rights | (92 | ) | (111 | ) | |||||
Gross deferred tax liability | (1,656 | ) | (1,991 | ) | |||||
Net deferred tax asset | 3,845 | 3,891 | |||||||
Valuation allowance | (183 | ) | (134 | ) | |||||
Net deferred tax asset, included in other assets | $ | 3,662 | $ | 3,757 |
PENSION_PLAN_Tables
PENSION PLAN (Tables) | 12 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Compensation and Retirement Disclosure [Abstract] | ' | ||||||||||||||||
Schedule of plan's funded status and amounts recognized | ' | ||||||||||||||||
The following table sets forth the plan’s funded status and amounts recognized in the Company’s consolidated balance sheet at September 30, 2013 and September 30, 2012. | |||||||||||||||||
At September 30, | |||||||||||||||||
2013 | 2012 | ||||||||||||||||
(Dollars in thousands) | |||||||||||||||||
Actuarial present value of benefit obligations | $ | 3,630 | $ | 4,156 | |||||||||||||
Change in benefit obligations | |||||||||||||||||
Projected benefit obligation, beginning | $ | 4,156 | $ | 3,719 | |||||||||||||
Interest cost | 162 | 172 | |||||||||||||||
Actuarial (gain) loss | (507 | ) | 438 | ||||||||||||||
Annuity payments and lump sum distributions | (181 | ) | (173 | ) | |||||||||||||
Projected benefit obligation, end | $ | 3,630 | $ | 4,156 | |||||||||||||
Change in plan assets | |||||||||||||||||
Fair value of assets, beginning | $ | 2,487 | $ | 2,196 | |||||||||||||
Actual return on plan assets | 252 | 296 | |||||||||||||||
Employer contributions | 172 | 168 | |||||||||||||||
Annuity payments and lump sum distributions | (181 | ) | (173 | ) | |||||||||||||
Fair value of assets, end | $ | 2,730 | $ | 2,487 | |||||||||||||
Funded status included with other liabilities | $ | (900 | ) | $ | (1,669 | ) | |||||||||||
Schedule of net pension costs | ' | ||||||||||||||||
Net pension cost for the years ended September 30, 2013 and 2012 included the following components: | |||||||||||||||||
September 30, | |||||||||||||||||
2013 | 2012 | ||||||||||||||||
(Dollars in thousands) | |||||||||||||||||
Service cost benefits earned during the year | $ | — | $ | — | |||||||||||||
Interest cost on projected benefit obligation | 162 | 172 | |||||||||||||||
Expected return on plan assets | (186 | ) | (161 | ) | |||||||||||||
Amortization of unrecognized net loss | 124 | 81 | |||||||||||||||
Net Pension Cost | $ | 100 | $ | 92 | |||||||||||||
Schedule of weighted-average asset allocations by asset category | ' | ||||||||||||||||
The Company’s pension plan weighted-average asset allocations at September 30, 2013 and 2012, by asset category are as follows: | |||||||||||||||||
September 30, | |||||||||||||||||
2013 | 2012 | ||||||||||||||||
Equity securities | 62% | 58% | |||||||||||||||
Debt securities (Bond Mutual Funds) | 37% | 42% | |||||||||||||||
Other (Money Market Fund) | 1% | 0% | |||||||||||||||
Total | 100% | 100% | |||||||||||||||
Schedule of expected benefit payments | ' | ||||||||||||||||
The following benefit payments are expected to be paid as follows (in thousands): | |||||||||||||||||
October 1, 2013 through September 30, 2014 | $ | 194 | |||||||||||||||
October 1, 2014 through September 30, 2015 | 197 | ||||||||||||||||
October 1, 2015 through September 30, 2016 | 197 | ||||||||||||||||
October 1, 2016 through September 30, 2017 | 198 | ||||||||||||||||
October 1, 2017 through September 30, 2018 | 198 | ||||||||||||||||
October 1, 2018 through September 30, 2023 | 998 | ||||||||||||||||
$ | 1,982 | ||||||||||||||||
Schedule of plan assets that are measured at fair value | ' | ||||||||||||||||
Financial assets are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. See Note R for further detail regarding fair value hierarchy. | |||||||||||||||||
Fair Value Measurements at Reporting Date Using: | |||||||||||||||||
Quoted Prices | Significant | ||||||||||||||||
At | in Active Markets | Other | Significant | ||||||||||||||
September 30, | for Identical | Observable | Unobservable | ||||||||||||||
2013 | Assets (Level 1) | Inputs (Level 2) | Inputs (Level 3) | ||||||||||||||
(In thousands) | |||||||||||||||||
Investment Type | |||||||||||||||||
Mutual Funds- Equity | |||||||||||||||||
Large-Cap Value | $ | 320 | $ | 320 | $ | — | $ | — | |||||||||
Large-Cap Core | 323 | 323 | — | — | |||||||||||||
Mid-Cap Core | 161 | 161 | — | — | |||||||||||||
Small-Cap Core | 165 | 165 | — | — | |||||||||||||
Non-U.S. Core | 717 | 717 | — | — | |||||||||||||
Mutual Funds- Fixed Income | |||||||||||||||||
Intermediate-Term Core | 1,006 | 1,006 | — | — | |||||||||||||
Cash Equivalents | |||||||||||||||||
Money Market | 38 | 38 | — | — | |||||||||||||
Total Investment | $ | 2,730 | $ | 2,730 | $ | — | $ | — | |||||||||
Fair Value Measurements at Reporting Date Using: | |||||||||||||||||
Quoted Prices | Significant | ||||||||||||||||
At | in Active Markets | Other | Significant | ||||||||||||||
September 30, | for Identical | Observable | Unobservable | ||||||||||||||
2012 | Assets (Level 1) | Inputs (Level 2) | Inputs (Level 3) | ||||||||||||||
(In thousands) | |||||||||||||||||
Investment Type | |||||||||||||||||
Mutual Funds- Equity | |||||||||||||||||
Large-Cap Value | $ | 270 | $ | 270 | $ | — | $ | — | |||||||||
Large-Cap Core | 278 | 278 | — | — | |||||||||||||
Mid-Cap Core | 129 | 129 | — | — | |||||||||||||
Small-Cap Core | 130 | 130 | — | — | |||||||||||||
Non-U.S. Core | 628 | 628 | — | — | |||||||||||||
Mutual Funds- Fixed Income | |||||||||||||||||
Intermediate-Term Core | 1,051 | 1,051 | — | — | |||||||||||||
Cash Equivalents | |||||||||||||||||
Money Market | 1 | 1 | — | — | |||||||||||||
Total Investment | $ | 2,487 | $ | 2,487 | $ | — | $ | — |
COMMITMENTS_Tables
COMMITMENTS (Tables) | 12 Months Ended | ||||
Sep. 30, 2013 | |||||
Commitments Tables | ' | ||||
Schedule of future minimum payments of operating leases | ' | ||||
Approximate future minimum payments under non-cancelable operating leases are due as follows for the years ending September 30 (in thousands): | |||||
September 30, | |||||
2014 | $ | 568 | |||
2015 | 568 | ||||
2016 | 588 | ||||
2017 | 627 | ||||
2018 | 627 | ||||
Thereafter | 5,011 | ||||
$ | 7,989 |
FINANCIAL_INSTRUMENTS_WITH_OFF1
FINANCIAL INSTRUMENTS WITH OFF-BALANCE-SHEET RISK (Tables) | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Financial Instruments With Off-Balance-Sheet Risk Tables | ' | ||||||||
Schedule of fair value, off-balance sheet financial instruments | ' | ||||||||
These commitments were comprised of fixed and variable rate loans. | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
(Dollars in thousands) | |||||||||
Financial instruments whose contract amounts | |||||||||
represent credit risk (in thousands) | |||||||||
Letters of credit | $ | 1,450 | $ | 1,450 | |||||
Unused lines of credit | 38,823 | 41,162 | |||||||
Fixed rate loan commitments | 2,546 | 1,988 | |||||||
Variable rate loan commitments | 6,985 | 14,112 | |||||||
$ | 49,804 | $ | 58,712 |
FAIR_VALUE_DISCLOSURES_Tables
FAIR VALUE DISCLOSURES (Tables) | 12 Months Ended | ||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||
Fair Value Disclosures Tables | ' | ||||||||||||||||||||
Schedule of assets measured at fair value on a recurring basis | ' | ||||||||||||||||||||
The following table provides the level of valuation assumptions used to determine the carrying value of our assets measured at fair value on a recurring basis at September 30, 2013 and 2012: | |||||||||||||||||||||
Fair Value at September 30, 2013 | |||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | ||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||
Securities available for sale: | |||||||||||||||||||||
Obligations of U.S. government agencies: | |||||||||||||||||||||
Mortgage-backed securities - residential | $ | 1,556 | $ | — | $ | 1,556 | $ | — | |||||||||||||
Obligations of U.S. government-sponsored enterprises: | |||||||||||||||||||||
Mortgage-backed securities - residential | 9,401 | — | 9,401 | — | |||||||||||||||||
Mortgage-backed securities - commercial | 4,002 | — | 4,002 | — | |||||||||||||||||
Private label mortgage-backed securities - residential | 815 | — | 815 | — | |||||||||||||||||
Total securities available for sale | $ | 15,774 | $ | — | $ | 15,774 | $ | — | |||||||||||||
Fair Value at September 30, 2012 | |||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | ||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||
Securities available for sale: | |||||||||||||||||||||
Obligations of U.S. government agencies: | |||||||||||||||||||||
Mortgage-backed securities - residential | $ | 1,861 | $ | — | $ | 1,861 | $ | — | |||||||||||||
Obligations of U.S. government-sponsored enterprises: | |||||||||||||||||||||
Mortgage-backed securities - residential | 8,575 | — | 8,575 | — | |||||||||||||||||
Mortgage-backed securities - commercial | 4,228 | — | 4,228 | — | |||||||||||||||||
Debt securities | 1,067 | — | 1,067 | — | |||||||||||||||||
Private label mortgage-backed securities - residential | 1,055 | — | 1,055 | — | |||||||||||||||||
Total securities available for sale | $ | 16,786 | $ | — | $ | 16,786 | $ | — | |||||||||||||
Schedule of assets measured at fair value on a non-recurring basis | ' | ||||||||||||||||||||
The following tables provide the level of valuation assumptions used to determine the carrying value of our assets measured at fair value on a non-recurring basis at September 30, 2013 and 2012: | |||||||||||||||||||||
Fair Value at September 30, 2013 | |||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | ||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||
Impaired loans | $ | 8,534 | $ | — | $ | — | $ | 8,534 | |||||||||||||
Other real estate owned | 230 | — | — | 230 | |||||||||||||||||
$ | 8,764 | $ | — | $ | — | $ | 8,764 | ||||||||||||||
Fair Value at September 30, 2012 | |||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | ||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||
Impaired loans | $ | 5,984 | $ | — | $ | — | $ | 5,984 | |||||||||||||
Other real estate owned | 464 | — | — | 464 | |||||||||||||||||
$ | 6,448 | $ | — | $ | — | $ | 6,448 | ||||||||||||||
Schedule of quantitative information about assets measured at fair value on a nonrecurring bassis for which Level 3 inputs were used to determine fair value | ' | ||||||||||||||||||||
The following table presents additional quantitative information about assets measured at fair value on a nonrecurring basis and for which Company has utilized Level 3 inputs to determine fair value: | |||||||||||||||||||||
Quantitative Information about Level 3 Fair Value Measurements | |||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||
Fair Value | Valuation | ||||||||||||||||||||
30-Sep-13 | Estimate | Techniques | Unobservable Input | Range (Weighted Average) | |||||||||||||||||
Impaired loans | $ | 8,534 | Appraisal of | Liquidation expenses (2) | 0% to -8.0% (-6.04%) | ||||||||||||||||
collateral (1) | |||||||||||||||||||||
Other real estate owned | $ | 230 | Appraisal of | Appraisal adjustments (2) | 15.40% | ||||||||||||||||
collateral (1), (3) | |||||||||||||||||||||
-1 | Fair value is generally determined through independent appraisals for the underlying collateral, which generally include various level 3 inputs which are not identifiable. | ||||||||||||||||||||
-2 | Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated liquidation expenses. The range and weighted average of liquidation expenses and other appraisal adjustments are presented as a percent of the appraisal. | ||||||||||||||||||||
-3 | Includes qualitative adjustments by management and estimated liquidation expenses. | ||||||||||||||||||||
Schedule of the carrying amount, fair value, and placement in the fair value hierarchy of financial instruments carried at cost or amortized cost | ' | ||||||||||||||||||||
Carrying | Fair | Fair Value Measurement Placement | |||||||||||||||||||
Value | Value | (Level 1) | (Level 2) | (Level 3) | |||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||
Financial instruments - assets | |||||||||||||||||||||
Investment securities held-to-maturity | $ | 52,558 | $ | 51,802 | $ | — | $ | 51,802 | $ | — | |||||||||||
Loans | 396,800 | 401,064 | — | — | 401,064 | ||||||||||||||||
Financial instruments - liabilities | |||||||||||||||||||||
Certificate of deposit | 153,841 | 155,306 | — | 155,306 | — | ||||||||||||||||
Borrowings | 32,100 | 33,430 | — | 33,430 | — | ||||||||||||||||
30-Sep-12 | |||||||||||||||||||||
Financial instruments - assets | |||||||||||||||||||||
Investment securities held-to-maturity | $ | 41,068 | $ | 42,130 | — | $ | 42,130 | $ | — | ||||||||||||
Loans | 385,270 | 396,111 | — | — | 396,111 | ||||||||||||||||
Financial instruments - liabilities | |||||||||||||||||||||
Certificate of deposit | 158,461 | 160,753 | — | 160,753 | — | ||||||||||||||||
Borrowings | 41,503 | 43,898 | — | 43,898 | — |
REGULATORY_CAPITAL_Tables
REGULATORY CAPITAL (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||
Regulatory Capital Tables | ' | ||||||||||||||||||||||||
Schedule of regulatory capital compliance | ' | ||||||||||||||||||||||||
To be well-capitalized | |||||||||||||||||||||||||
For capital | under prompt corrective | ||||||||||||||||||||||||
Actual | adequacy purposes | action provisions | |||||||||||||||||||||||
Amount | Ratio | Amount | Ratio | Amount | Ratio | ||||||||||||||||||||
As of September 30, 2013 | |||||||||||||||||||||||||
Total Capital (to risk-weighted assets) | |||||||||||||||||||||||||
Magyar Bancorp, Inc. | 48,948 | 13.24% | 29,584 | > 8.00% | N/A | N/A | |||||||||||||||||||
Magyar Bank | 46,313 | 12.52% | 29,582 | > 8.00% | 36,977 | > 10.00% | |||||||||||||||||||
Tier 1 Capital (to risk-weighted assets) | |||||||||||||||||||||||||
Magyar Bancorp, Inc. | 45,935 | 12.42% | 14,792 | > 4.00% | N/A | N/A | |||||||||||||||||||
Magyar Bank | 43,300 | 11.71% | 14,791 | > 4.00% | 22,186 | > 6.00% | |||||||||||||||||||
Tier 1 Capital (to average assets) | |||||||||||||||||||||||||
Magyar Bancorp, Inc. | 45,935 | 8.61% | 21,341 | > 4.00% | N/A | N/A | |||||||||||||||||||
Magyar Bank | 43,300 | 8.12% | 21,340 | > 4.00% | 26,676 | > 5.00% | |||||||||||||||||||
As of September 30, 2012 | |||||||||||||||||||||||||
Total Capital (to risk-weighted assets) | |||||||||||||||||||||||||
Magyar Bancorp, Inc. | 49,439 | 13.93% | 28,402 | > 8.00% | N/A | N/A | |||||||||||||||||||
Magyar Bank | 46,897 | 13.21% | 28,400 | > 8.00% | 35,500 | > 10.00% | |||||||||||||||||||
Tier 1 Capital (to risk-weighted assets) | |||||||||||||||||||||||||
Magyar Bancorp, Inc. | 45,581 | 12.84% | 14,201 | > 4.00% | N/A | N/A | |||||||||||||||||||
Magyar Bank | 43,039 | 12.12% | 14,200 | > 4.00% | 21,300 | > 6.00% | |||||||||||||||||||
Tier 1 Capital (to average assets) | |||||||||||||||||||||||||
Magyar Bancorp, Inc. | 45,581 | 8.90% | 20,492 | > 4.00% | N/A | N/A | |||||||||||||||||||
Magyar Bank | 43,039 | 8.40% | 20,491 | > 4.00% | 25,614 | > 5.00% |
ORGANIZATION_Details_Narrative
ORGANIZATION (Details Narrative) | Sep. 30, 2013 | Sep. 30, 2012 |
Common stock, shares outstanding | 5,811,394 | 5,807,344 |
Treasury stock, shares | 112,348 | 116,398 |
Treasury Stock | ' | ' |
Ownership of Maygar Bancorp, Inc. (percentage) | 1.90% | ' |
Treasury stock, shares | 112,348 | ' |
Hungaria Urban Renewal | ' | ' |
Ownership of Subsidiaries | 100.00% | ' |
Magyar Bank, MHC | ' | ' |
Ownership of Subsidiaries | 100.00% | ' |
Ownership of Maygar Bancorp, Inc. (percentage) | 54.00% | ' |
Common stock, shares outstanding | 3,200,450 | ' |
Magyar Bank | ' | ' |
Ownership of Maygar Bancorp, Inc. (percentage) | 44.10% | ' |
Common stock, shares outstanding | 2,610,944 | ' |
SUMMARY_OF_SIGNIFICANT_ACCOUNT3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) (USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 |
Summary Of Significant Accounting Policies Details Narrative | ' |
Commercial relationships | $500 |
Criticized relationships | $250 |
SUMMARY_OF_SIGNIFICANT_ACCOUNT4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) (USD $) | 12 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Basic EPS | ' | ' |
Net income available to common shareholders | $262 | $509 |
Weighted average number of common shares outstanding - basic | 5,810,910 | 5,810,294 |
Basic earnings (loss) per share | $0.05 | $0.09 |
Effect of dilutive securities | ' | ' |
Options and grants | 863 | ' |
Diluted EPS | ' | ' |
Net income available to common shareholders plus assumed conversion | $262 | $509 |
Weighted average number of common shares and common share equivalents - diluted | 5,811,773 | 5,810,294 |
Diluted earnings (loss) per share | $0.05 | $0.09 |
SUMMARY_OF_SIGNIFICANT_ACCOUNT5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1) (USD $) | 12 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | ||
Unrealized holding gains (losses) arising during period on: | ' | ' | ||
Available-for-sale investments before tax | ($544) | $276 | ||
Tax benefit (expense) | 197 | -116 | ||
Available-for-sale investments after tax | -347 | 160 | ||
Reclassification adjustment for net gains realized on available-for-sale investments before tax | -121 | [1],[2] | -286 | [1],[2] |
Tax benefit (expense) | 48 | [1],[2] | 114 | [1],[2] |
Reclassification adjustment for net gains realized on available-for-sale investments after tax | -73 | [1],[2] | -172 | [1],[2] |
Defined benefit pension plan before tax | 697 | -222 | ||
Tax benefit (expense) | -278 | 89 | ||
Defined benefit pension plan after tax | 419 | -133 | ||
Interest rate derivatives before tax | -54 | -87 | ||
Tax benefit (expense) | 21 | 35 | ||
Interest rate derivatives after tax | -33 | -52 | ||
Other comprehensive gain (loss), net before tax | -22 | -319 | ||
Tax benefit (expense), Total | -12 | 122 | ||
Other comprehensive gain (loss), net | ($34) | ($197) | ||
[1] | Realized gains on securities transactions included in gains on sales of investment securities in the accompanying Consolidated Statements of Operations | |||
[2] | Tax effect included in income tax expense in the accompanying Consolidated Statements of Operations |
SUMMARY_OF_SIGNIFICANT_ACCOUNT6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Summary Of Significant Accounting Policies Details 2 | ' | ' |
Available-for-sale investments | ($114) | $306 |
Defined benefit pension plan | -524 | -943 |
Interest rate derivatives | ' | 33 |
Total accumulated other comprehensive loss | ($638) | ($604) |
STOCKBASED_COMPENSATION_Detail
STOCK-BASED COMPENSATION (Details Narrative) (USD $) | 12 Months Ended | 7 Months Ended | 71 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Nov. 30, 2007 | Sep. 30, 2013 |
First Repurchase Program | Second Repurchase Program | |||
Stock option expenses | $0 | $68 | ' | ' |
Stock award expenses | 18 | 113 | ' | ' |
Maximum stock repurchase authorization (as a percent) | ' | ' | 5.00% | 5.00% |
Stock authorized to be repurchased (in shares) | ' | ' | 130,927 | 129,924 |
Stock repurchased during period (in shares) | ' | ' | ' | 81,000 |
Remaining shares available to be repurchased | ' | ' | ' | 48,924 |
Common stock average cost (in dollars per share) | ' | ' | ' | $8.33 |
Cost of shares repurchased by ESOP trust | 2,300 | ' | ' | ' |
Average cost of shares repurchased (per share) | $10.58 | ' | ' | ' |
Description of loan with respect to employee stock ownership plan | 'The ESOP trust purchased 217,863 shares of common stock in the open market using proceeds of a loan from the Company. The Bank will make cash contributions to the ESOP on an annual basis sufficient to enable the ESOP to make the required loan payments to the Company. The loan bears a variable interest rate that adjusts annually to Prime (3.25% at September 30, 2013) with principal and interest payable annually in equal installments over thirty years. The loan is secured by shares of the Company's stock. | ' | ' | ' |
Interest rate of loan with respect to employee stock ownership plan | 3.25% | ' | ' | ' |
Fair value of unreleased shares | $756 | ' | ' | ' |
STOCKBASED_COMPENSATION_Detail1
STOCK-BASED COMPENSATION (Details) (USD $) | 12 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Options Outstanding | ' | ' |
Balance at the beginning of period | 188,276 | 188,276 |
Balance at the end of period | 188,276 | 188,276 |
Exercisable at the end of period | 188,276 | ' |
Options, Weighted-Average Exercise Price | ' | ' |
Weighted average price at the beginning of period | $14.61 | $14.61 |
Weighted average price at the end of period | $14.61 | $14.61 |
Exercisable at the end of period | $14.61 | ' |
Weighted- Average Remaining Contractual Life of Stock options outstanding at the beginning of period (in years) | '4 years 4 months 24 days | '5 years 4 months 24 days |
Weighted- Average Remaining Contractual Life of Stock options outstanding at the end of period (in years) | '3 years 4 months 24 days | '4 years 4 months 24 days |
Weighted- Average Remaining Contractual Life, Stock options Exercisable at the end of period (in years) | '3 years 4 months 24 days | ' |
STOCKBASED_COMPENSATION_Detail2
STOCK-BASED COMPENSATION (Details 1) (USD $) | 12 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Non Vested Stock Awards Outstanding | ' | ' |
Balance at the beginning of period (in shares) | 13,402 | 33,145 |
Stock Awards vested (in shares) | -4,050 | -19,743 |
Balance at the end of period (in shares) | 9,352 | 13,402 |
Non Vested Stock Awards, Weighted Average Grant Date Fair Value | ' | ' |
Balance at the beginning of period (in dollars per share) | $4.43 | $9.22 |
Stock Awards vested (in dollars per share) | $4.44 | $12.48 |
Balance at the end of period (in dollars per share) | $4.42 | $4.43 |
STOCKBASED_COMPENSATION_Detail3
STOCK-BASED COMPENSATION (Details 2) | Sep. 30, 2013 | Sep. 30, 2012 |
Stock-Based Compensation Details 2 | ' | ' |
Unreleased shares, beginning | 101,873 | 114,318 |
Shares released for allocation during the year | -12,445 | ' |
Unreleased shares, ending | 101,873 | 114,318 |
Total released shares | 115,990 | ' |
Total ESOP shares | 217,863 | ' |
INVESTMENT_SECURITIES_Details_
INVESTMENT SECURITIES (Details Narrative) (USD $) | 12 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | ||
Investment Securities Details Narrative | ' | ' | ||
Sales of investment securities available for sale | $4,307 | $14,164 | ||
Realized gains on sales of securities available for sale | 121 | [1],[2] | 286 | [1],[2] |
Securities pledged to secure public deposits, fair value | $9,800 | $1,700 | ||
[1] | Realized gains on securities transactions included in gains on sales of investment securities in the accompanying Consolidated Statements of Operations | |||
[2] | Tax effect included in income tax expense in the accompanying Consolidated Statements of Operations |
INVESTMENT_SECURITIES_Details
INVESTMENT SECURITIES (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Available for sale securities | ' | ' |
Amortized Cost | $15,955 | $16,302 |
Gross Unrealized Gains | 62 | 485 |
Gross Unrealized Losses | -243 | -1 |
Fair Value | 15,774 | 16,786 |
Held to maturity securities | ' | ' |
Amortized Cost | 52,558 | 41,068 |
Gross Unrealized Gains | 621 | 1,184 |
Gross Unrealized Losses | -1,377 | -122 |
Fair Value | 51,802 | 42,130 |
Obligations of U.S. government agencies Mortgage backed securities - residential | ' | ' |
Available for sale securities | ' | ' |
Amortized Cost | 1,551 | 1,850 |
Gross Unrealized Gains | 5 | 11 |
Fair Value | 1,556 | 1,861 |
Held to maturity securities | ' | ' |
Amortized Cost | 9,455 | 10,790 |
Gross Unrealized Gains | 231 | 414 |
Gross Unrealized Losses | -121 | -8 |
Fair Value | 9,565 | 11,196 |
Obligations of U.S. government agencies Mortgage backed securities -commercial | ' | ' |
Held to maturity securities | ' | ' |
Amortized Cost | 1,433 | 1,522 |
Gross Unrealized Gains | ' | 14 |
Gross Unrealized Losses | -3 | ' |
Fair Value | 1,430 | 1,536 |
Obligations of U.S. government-sponsored enterprises Mortgage backed securities - residential | ' | ' |
Available for sale securities | ' | ' |
Amortized Cost | 9,633 | 8,368 |
Gross Unrealized Gains | 9 | 207 |
Gross Unrealized Losses | -241 | ' |
Fair Value | 9,401 | 8,575 |
Held to maturity securities | ' | ' |
Amortized Cost | 33,758 | 18,578 |
Gross Unrealized Gains | 363 | 722 |
Gross Unrealized Losses | -975 | -5 |
Fair Value | 33,146 | 19,295 |
Obligations of U.S. government-sponsored enterprises Debt securities | ' | ' |
Available for sale securities | ' | ' |
Amortized Cost | ' | 1,000 |
Gross Unrealized Gains | ' | 67 |
Fair Value | ' | 1,067 |
Held to maturity securities | ' | ' |
Amortized Cost | 4,000 | 5,770 |
Gross Unrealized Gains | ' | 6 |
Gross Unrealized Losses | -267 | ' |
Fair Value | 3,733 | 5,776 |
Obligations of U.S. government-sponsored enterprises Mortgage backed securities -commercial | ' | ' |
Available for sale securities | ' | ' |
Amortized Cost | 3,963 | 4,053 |
Gross Unrealized Gains | 39 | 175 |
Fair Value | 4,002 | 4,228 |
Private label mortgage-backed securities-residential | ' | ' |
Available for sale securities | ' | ' |
Amortized Cost | 808 | 1,031 |
Gross Unrealized Gains | 9 | 25 |
Gross Unrealized Losses | -2 | -1 |
Fair Value | 815 | 1,055 |
Held to maturity securities | ' | ' |
Amortized Cost | 901 | 1,367 |
Gross Unrealized Gains | 27 | 27 |
Gross Unrealized Losses | -11 | ' |
Fair Value | 917 | 1,394 |
Obligations of state and political subdivisions | ' | ' |
Held to maturity securities | ' | ' |
Amortized Cost | 11 | 41 |
Gross Unrealized Gains | ' | 1 |
Fair Value | 11 | 42 |
Corporate securities | ' | ' |
Held to maturity securities | ' | ' |
Amortized Cost | 3,000 | 3,000 |
Gross Unrealized Losses | ' | -109 |
Fair Value | $3,000 | $2,891 |
INVESTMENT_SECURITIES_Details_1
INVESTMENT SECURITIES (Details 1) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 | |
In Thousands, unless otherwise specified | |||
Available for Sale Securities, Amortized Cost | ' | ' | |
Mortgage Backed Securities, Residential | $11,992 | [1] | ' |
Mortgage Backed Securities, Commercial | 3,963 | [2] | ' |
Amortized Cost | 15,955 | 16,302 | |
Available for Sale Securities, Fair Value | ' | ' | |
Mortgage Backed Securities, Residential | 11,772 | [1] | ' |
Mortgage Backed Securities, Commercial | 4,002 | [2] | ' |
Fair Value | $15,774 | $16,786 | |
[1] | Available-for-sale mortgage-backed securities - residential include an amortized cost of $1.6 million and a fair value of $1.6 million for obligations of U.S. government agencies issued by the Government National Mortgage Association and obligations of U.S. government-sponsored enterprises issued by Federal National Mortgage Association and Federal Home Loan Mortgage Corporation which had an amortized cost of $9.6 million and a fair value of $9.4 million. Also included are residential mortgage-backed securities issued by non-U.S. government agencies and government-sponsored enterprises with an amortized cost of $808,000 and fair value of $815,000. | ||
[2] | Available-for-sale mortgage-backed securities - commercial include an amortized cost of $4.0 million and a fair value of $4.0 million for obligations of U.S. government-sponsored enterprises issued by the Federal National Mortgage Association. |
INVESTMENT_SECURITIES_Details_2
INVESTMENT SECURITIES (Details 2) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 | |
In Thousands, unless otherwise specified | |||
Held to Maturity Securities, Amortized Cost | ' | ' | |
Due within 1 year | $11 | ' | |
Due after 1 but within 5 years | 3,000 | ' | |
Due after 5 but within 10 years | 1,000 | ' | |
Due after 10 years | 3,000 | ' | |
Total debt securities | 7,011 | ' | |
Mortgage Backed Securities, Residential | 44,114 | [1] | ' |
Mortgage Backed Securities, Commercial | 1,433 | [2] | ' |
Amortized cost | 52,558 | 41,068 | |
Held to Maturity Securities, Fair Value | ' | ' | |
Due within 1 year | 11 | ' | |
Due after 1 but within 5 years | 3,000 | ' | |
Due after 5 but within 10 years | 921 | ' | |
Due after 10 years | 2,812 | ' | |
Total debt securities | 6,744 | ' | |
Mortgage Backed Securities, Residential | 43,628 | [1] | ' |
Mortgage Backed Securities, Commercial | 1,430 | [2] | ' |
Fair value | $51,802 | $42,130 | |
[1] | Held-to-maturity mortgage-backed securities - residential include an amortized cost of $9.5 million and a fair value of $9.6 million for obligations of U.S. government agencies issued by the Government National Mortgage Association and obligations of U.S. government-sponsored enterprises issued by Federal National Mortgage Association and Federal Home Loan Mortgage Corporation which had an amortized cost of $33.8 million and a fair value of $33.1 million. Also included are mortgage-backed securities issued by non-U.S. government agencies and government-sponsored enterprises with an amortized cost of $901,000 and a fair value of $917,000. | ||
[2] | Held-to-maturity mortgage-backed securities - commercial include an amortized cost of $1.4 million and a fair value of $1.4 million for obligations of U.S. government agencies issued by the Small Business Administration. |
INVESTMENT_SECURITIES_Details_3
INVESTMENT SECURITIES (Details 3) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | N | N |
Available For Sale and Held To Maturity Securities | ' | ' |
Number of Securities | 33 | 6 |
Less than 12 Months, Fair Value | $41,083 | $1,143 |
Less than 12 Months, Unrealized Losses | -1,540 | -5 |
12 Months or Longer, Fair Value | 1,746 | 4,646 |
12 Months or Longer, Unrealized Losses | -80 | -118 |
Total, Fair Value | 42,829 | 5,789 |
Total, Unrealized Losses | -1,620 | -123 |
Obligations of U.S. government agencies Mortgage backed securities - residential | ' | ' |
Available For Sale and Held To Maturity Securities | ' | ' |
Number of Securities | 3 | 1 |
Less than 12 Months, Fair Value | 1,887 | ' |
Less than 12 Months, Unrealized Losses | -57 | ' |
12 Months or Longer, Fair Value | 1,099 | 1,729 |
12 Months or Longer, Unrealized Losses | -64 | -8 |
Total, Fair Value | 2,986 | 1,729 |
Total, Unrealized Losses | -121 | -8 |
Obligations of U.S. government agencies Mortgage backed securities -commercial | ' | ' |
Available For Sale and Held To Maturity Securities | ' | ' |
Number of Securities | 1 | ' |
Less than 12 Months, Fair Value | 1,430 | ' |
Less than 12 Months, Unrealized Losses | -3 | ' |
Total, Fair Value | 1,430 | ' |
Total, Unrealized Losses | -3 | ' |
Obligations of U.S. government-sponsored enterprises Mortgage backed securities - residential | ' | ' |
Available For Sale and Held To Maturity Securities | ' | ' |
Number of Securities | 22 | 1 |
Less than 12 Months, Fair Value | 30,638 | 1,143 |
Less than 12 Months, Unrealized Losses | -1,202 | -5 |
12 Months or Longer, Fair Value | 626 | ' |
12 Months or Longer, Unrealized Losses | -14 | ' |
Total, Fair Value | 31,264 | 1,143 |
Total, Unrealized Losses | -1,216 | -5 |
Obligations of U.S. government-sponsored enterprises Debt securities | ' | ' |
Available For Sale and Held To Maturity Securities | ' | ' |
Number of Securities | 4 | ' |
Less than 12 Months, Fair Value | 3,732 | ' |
Less than 12 Months, Unrealized Losses | -267 | ' |
Total, Fair Value | 3,732 | ' |
Total, Unrealized Losses | -267 | ' |
Private label mortgage-backed securities-residential | ' | ' |
Available For Sale and Held To Maturity Securities | ' | ' |
Number of Securities | 2 | 3 |
Less than 12 Months, Fair Value | 396 | ' |
Less than 12 Months, Unrealized Losses | -11 | ' |
12 Months or Longer, Fair Value | 21 | 26 |
12 Months or Longer, Unrealized Losses | -2 | -1 |
Total, Fair Value | 417 | 26 |
Total, Unrealized Losses | -13 | -1 |
Corporate securities | ' | ' |
Available For Sale and Held To Maturity Securities | ' | ' |
Number of Securities | 1 | 1 |
Less than 12 Months, Fair Value | 3,000 | ' |
12 Months or Longer, Fair Value | ' | 2,891 |
12 Months or Longer, Unrealized Losses | ' | -109 |
Total, Fair Value | 3,000 | 2,891 |
Total, Unrealized Losses | ' | ($109) |
LOANS_RECEIVABLE_NET_Details_N
LOANS RECEIVABLE, NET (Details Narrative) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Loans Receivable Net Details Narrative | ' | ' |
Loans receivable from directors, executives, affiliates | $5,000 | $5,900 |
Principal Additions - loans receivable-related parties | 1,300 | ' |
Principal Repayments - loans receivable-related parties | 2,200 | ' |
Value of loans serviced on behalf of others | 27,000 | 27,200 |
Mortgage Servicing Rights | 229 | 279 |
Escrow balance held for loans serviced on behalf of others | 179 | 209 |
Average Recorded Investment | 22,900 | 24,000 |
Interest Income not recognized on non-accrual loans | 763 | 2,100 |
Interest-only mortgage loans | 16,900 | 17,400 |
Loans pledged as collateral against Federal Home Loan Bank of New York borrowings | $97,800 | $86,300 |
LOANS_RECEIVABLE_NET_Details
LOANS RECEIVABLE, NET (Details) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' |
Total loans receivable | $399,566 | $388,924 |
Net deferred loan costs | 247 | 204 |
Allowance for loan losses | -3,013 | -3,858 |
Total loans receivable, net | 396,800 | 385,270 |
One-to four-family residential | ' | ' |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' |
Total loans receivable | 152,977 | 157,536 |
Allowance for loan losses | -844 | -610 |
Commercial real estate | ' | ' |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' |
Total loans receivable | 163,368 | 148,806 |
Allowance for loan losses | -852 | -1,929 |
Construction | ' | ' |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' |
Total loans receivable | 16,749 | 17,952 |
Allowance for loan losses | -604 | -640 |
Home equity lines of credit | ' | ' |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' |
Total loans receivable | 20,349 | 23,435 |
Allowance for loan losses | -125 | -232 |
Commercial business | ' | ' |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' |
Total loans receivable | 34,492 | 29,930 |
Allowance for loan losses | -452 | -383 |
Other | ' | ' |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' |
Total loans receivable | 11,631 | 11,265 |
Allowance for loan losses | ($9) | ($23) |
LOANS_RECEIVABLE_NET_Details_1
LOANS RECEIVABLE, NET (Details 1) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Financing Receivable, Impaired [Line Items] | ' | ' |
Recorded Investment With Specific Allowance | $7,224 | $5,351 |
Related Allowance | 542 | 932 |
Recorded Investment With No Specific Allowance | 18,084 | 15,714 |
Total Recorded Investment | 25,308 | 21,065 |
Total Unpaid Contractual Principal Balance | 29,147 | 24,269 |
One-to four-family residential | ' | ' |
Financing Receivable, Impaired [Line Items] | ' | ' |
Recorded Investment With Specific Allowance | 6,192 | ' |
Related Allowance | 513 | ' |
Recorded Investment With No Specific Allowance | 8,478 | 7,124 |
Total Recorded Investment | 14,670 | 7,124 |
Total Unpaid Contractual Principal Balance | 15,631 | 7,594 |
Commercial real estate | ' | ' |
Financing Receivable, Impaired [Line Items] | ' | ' |
Recorded Investment With Specific Allowance | 421 | 3,999 |
Related Allowance | 7 | 798 |
Recorded Investment With No Specific Allowance | 5,599 | 2,425 |
Total Recorded Investment | 6,020 | 6,424 |
Total Unpaid Contractual Principal Balance | 7,179 | 7,204 |
Construction | ' | ' |
Financing Receivable, Impaired [Line Items] | ' | ' |
Recorded Investment With Specific Allowance | 600 | ' |
Related Allowance | 11 | ' |
Recorded Investment With No Specific Allowance | 2,896 | 5,141 |
Total Recorded Investment | 3,496 | 5,141 |
Total Unpaid Contractual Principal Balance | 4,953 | 6,927 |
Home equity lines of credit | ' | ' |
Financing Receivable, Impaired [Line Items] | ' | ' |
Recorded Investment With Specific Allowance | ' | 1,340 |
Related Allowance | ' | 122 |
Recorded Investment With No Specific Allowance | 1,027 | 967 |
Total Recorded Investment | 1,027 | 2,307 |
Total Unpaid Contractual Principal Balance | 1,268 | 2,475 |
Commercial business | ' | ' |
Financing Receivable, Impaired [Line Items] | ' | ' |
Recorded Investment With Specific Allowance | 11 | ' |
Related Allowance | 11 | ' |
Recorded Investment With No Specific Allowance | 84 | 57 |
Total Recorded Investment | 95 | 57 |
Total Unpaid Contractual Principal Balance | 116 | 57 |
Other | ' | ' |
Financing Receivable, Impaired [Line Items] | ' | ' |
Recorded Investment With Specific Allowance | ' | 12 |
Related Allowance | ' | 12 |
Total Recorded Investment | ' | 12 |
Total Unpaid Contractual Principal Balance | ' | $12 |
LOANS_RECEIVABLE_NET_Details_2
LOANS RECEIVABLE, NET (Details 2) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Total loans receivable | $399,566 | $388,924 |
Pass | ' | ' |
Total loans receivable | 369,755 | 349,982 |
Special Mention | ' | ' |
Total loans receivable | 1,940 | 15,509 |
Substandard | ' | ' |
Total loans receivable | 27,871 | 20,414 |
Doubtful | ' | ' |
Total loans receivable | ' | 3,019 |
One-to four-family residential | ' | ' |
Total loans receivable | 152,977 | 157,536 |
One-to four-family residential | Pass | ' | ' |
Total loans receivable | 141,881 | 146,487 |
One-to four-family residential | Special Mention | ' | ' |
Total loans receivable | 346 | 3,925 |
One-to four-family residential | Substandard | ' | ' |
Total loans receivable | 10,750 | 7,124 |
Commercial real estate | ' | ' |
Total loans receivable | 163,368 | 148,806 |
Commercial real estate | Pass | ' | ' |
Total loans receivable | 156,511 | 137,616 |
Commercial real estate | Special Mention | ' | ' |
Total loans receivable | 1,128 | 3,063 |
Commercial real estate | Substandard | ' | ' |
Total loans receivable | 5,729 | 6,448 |
Commercial real estate | Doubtful | ' | ' |
Total loans receivable | ' | 1,679 |
Construction | ' | ' |
Total loans receivable | 16,749 | 17,952 |
Construction | Pass | ' | ' |
Total loans receivable | 8,839 | 8,274 |
Construction | Special Mention | ' | ' |
Total loans receivable | ' | 4,537 |
Construction | Substandard | ' | ' |
Total loans receivable | 7,910 | 5,141 |
Home equity lines of credit | ' | ' |
Total loans receivable | 20,349 | 23,435 |
Home equity lines of credit | Pass | ' | ' |
Total loans receivable | 17,988 | 20,295 |
Home equity lines of credit | Special Mention | ' | ' |
Total loans receivable | ' | 833 |
Home equity lines of credit | Substandard | ' | ' |
Total loans receivable | 2,361 | 967 |
Home equity lines of credit | Doubtful | ' | ' |
Total loans receivable | ' | 1,340 |
Commercial business | ' | ' |
Total loans receivable | 34,492 | 29,930 |
Commercial business | Pass | ' | ' |
Total loans receivable | 32,905 | 26,057 |
Commercial business | Special Mention | ' | ' |
Total loans receivable | 466 | 3,151 |
Commercial business | Substandard | ' | ' |
Total loans receivable | 1,121 | 722 |
Other | ' | ' |
Total loans receivable | 11,631 | 11,265 |
Other | Pass | ' | ' |
Total loans receivable | 11,631 | 11,253 |
Other | Special Mention | ' | ' |
Total loans receivable | ' | ' |
Other | Substandard | ' | ' |
Total loans receivable | ' | $12 |
LOANS_RECEIVABLE_NET_Details_3
LOANS RECEIVABLE, NET (Details 3) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Aging analysis of past due loans | ' | ' |
Current | $383,282 | $365,601 |
30-59 Days Past Due | 250 | 791 |
60-89 Days Past Due | 378 | 2,458 |
90 Days + Past Due | 15,656 | 20,074 |
Total Past Due | 16,284 | 23,323 |
Non - Accrual | 15,656 | 20,074 |
Total loans receivable | 399,566 | 388,924 |
One-to four-family residential | ' | ' |
Aging analysis of past due loans | ' | ' |
Current | 144,084 | 147,749 |
30-59 Days Past Due | ' | 621 |
60-89 Days Past Due | 378 | 1,589 |
90 Days + Past Due | 8,515 | 7,577 |
Total Past Due | 8,893 | 9,787 |
Non - Accrual | 8,515 | 7,577 |
Total loans receivable | 152,977 | 157,536 |
Commercial real estate | ' | ' |
Aging analysis of past due loans | ' | ' |
Current | 160,624 | 141,674 |
60-89 Days Past Due | ' | 708 |
90 Days + Past Due | 2,744 | 6,424 |
Total Past Due | 2,744 | 7,132 |
Non - Accrual | 2,744 | 6,424 |
Total loans receivable | 163,368 | 148,806 |
Construction | ' | ' |
Aging analysis of past due loans | ' | ' |
Current | 13,223 | 12,811 |
90 Days + Past Due | 3,526 | 5,141 |
Total Past Due | 3,526 | 5,141 |
Non - Accrual | 3,526 | 5,141 |
Total loans receivable | 16,749 | 17,952 |
Home equity lines of credit | ' | ' |
Aging analysis of past due loans | ' | ' |
Current | 19,253 | 22,353 |
30-59 Days Past Due | 250 | 160 |
60-89 Days Past Due | ' | 59 |
90 Days + Past Due | 846 | 863 |
Total Past Due | 1,096 | 1,082 |
Non - Accrual | 846 | 863 |
Total loans receivable | 20,349 | 23,435 |
Commercial business | ' | ' |
Aging analysis of past due loans | ' | ' |
Current | 34,467 | 29,761 |
30-59 Days Past Due | ' | 10 |
60-89 Days Past Due | ' | 102 |
90 Days + Past Due | 25 | 57 |
Total Past Due | 25 | 169 |
Non - Accrual | 25 | 57 |
Total loans receivable | 34,492 | 29,930 |
Other | ' | ' |
Aging analysis of past due loans | ' | ' |
Current | 11,631 | 11,253 |
90 Days + Past Due | ' | 12 |
Total Past Due | ' | 12 |
Non - Accrual | ' | 12 |
Total loans receivable | $11,631 | $11,265 |
LOANS_RECEIVABLE_NET_Details_4
LOANS RECEIVABLE, NET (Details 4) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Activity in the allowance for loan losses by loan category: | ' | ' |
Balance at beginning of period | $3,858 | $3,812 |
Charge-offs | -3,260 | -1,466 |
Recoveries | 304 | 51 |
Provision | 2,111 | 1,461 |
Balance at the end of period | 3,013 | 3,858 |
One-to four-family residential | ' | ' |
Activity in the allowance for loan losses by loan category: | ' | ' |
Balance at beginning of period | 610 | 734 |
Charge-offs | -478 | -326 |
Provision | 712 | 202 |
Balance at the end of period | 844 | 610 |
Commercial real estate | ' | ' |
Activity in the allowance for loan losses by loan category: | ' | ' |
Balance at beginning of period | 1,929 | 1,266 |
Charge-offs | -576 | -110 |
Recoveries | 20 | ' |
Provision | -521 | 773 |
Balance at the end of period | 852 | 1,929 |
Construction | ' | ' |
Activity in the allowance for loan losses by loan category: | ' | ' |
Balance at beginning of period | 640 | 1,043 |
Charge-offs | -1,374 | -880 |
Recoveries | 284 | 51 |
Provision | 1,054 | 426 |
Balance at the end of period | 604 | 640 |
Home equity lines of credit | ' | ' |
Activity in the allowance for loan losses by loan category: | ' | ' |
Balance at beginning of period | 232 | 101 |
Charge-offs | -13 | -81 |
Provision | -95 | 212 |
Balance at the end of period | 125 | 232 |
Commercial business | ' | ' |
Activity in the allowance for loan losses by loan category: | ' | ' |
Balance at beginning of period | 383 | 551 |
Charge-offs | -806 | -69 |
Provision | 875 | -99 |
Balance at the end of period | 452 | 383 |
Other | ' | ' |
Activity in the allowance for loan losses by loan category: | ' | ' |
Balance at beginning of period | 23 | 13 |
Charge-offs | -13 | ' |
Provision | -1 | 10 |
Balance at the end of period | 9 | 23 |
Unallocated | ' | ' |
Activity in the allowance for loan losses by loan category: | ' | ' |
Balance at beginning of period | 41 | 104 |
Provision | 86 | -63 |
Balance at the end of period | $127 | $41 |
LOANS_RECEIVABLE_NET_Details_5
LOANS RECEIVABLE, NET (Details 5) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Allowance for Loan Losses: | ' | ' |
Balance - Allowance for loans losses | $3,013 | $3,858 |
Individually evaluated for impairment | 542 | 932 |
Collectively evaluated for impairment | 2,471 | 2,926 |
Balance - Loans receivable | 399,566 | 388,924 |
Loan balance individually evaluated for impairment | 25,308 | 21,065 |
Loan balance collectively evaluated for impairment | 374,258 | 367,859 |
One-to four-family residential | ' | ' |
Allowance for Loan Losses: | ' | ' |
Balance - Allowance for loans losses | 844 | 610 |
Individually evaluated for impairment | 513 | ' |
Collectively evaluated for impairment | 331 | 610 |
Balance - Loans receivable | 152,977 | 157,536 |
Loan balance individually evaluated for impairment | 14,670 | 7,124 |
Loan balance collectively evaluated for impairment | 138,307 | 150,412 |
Commercial real estate | ' | ' |
Allowance for Loan Losses: | ' | ' |
Balance - Allowance for loans losses | 852 | 1,929 |
Individually evaluated for impairment | 7 | 798 |
Collectively evaluated for impairment | 845 | 1,131 |
Balance - Loans receivable | 163,368 | 148,806 |
Loan balance individually evaluated for impairment | 6,020 | 6,424 |
Loan balance collectively evaluated for impairment | 157,348 | 142,382 |
Construction | ' | ' |
Allowance for Loan Losses: | ' | ' |
Balance - Allowance for loans losses | 604 | 640 |
Individually evaluated for impairment | 11 | ' |
Collectively evaluated for impairment | 593 | 640 |
Balance - Loans receivable | 16,749 | 17,952 |
Loan balance individually evaluated for impairment | 3,496 | 5,141 |
Loan balance collectively evaluated for impairment | 13,253 | 12,811 |
Home equity lines of credit | ' | ' |
Allowance for Loan Losses: | ' | ' |
Balance - Allowance for loans losses | 125 | 232 |
Individually evaluated for impairment | ' | 122 |
Collectively evaluated for impairment | 125 | 110 |
Balance - Loans receivable | 20,349 | 23,435 |
Loan balance individually evaluated for impairment | 1,027 | 2,307 |
Loan balance collectively evaluated for impairment | 19,322 | 21,128 |
Commercial business | ' | ' |
Allowance for Loan Losses: | ' | ' |
Balance - Allowance for loans losses | 452 | 383 |
Individually evaluated for impairment | 11 | ' |
Collectively evaluated for impairment | 441 | 383 |
Balance - Loans receivable | 34,492 | 29,930 |
Loan balance individually evaluated for impairment | 95 | 57 |
Loan balance collectively evaluated for impairment | 34,397 | 29,873 |
Other | ' | ' |
Allowance for Loan Losses: | ' | ' |
Balance - Allowance for loans losses | 9 | 23 |
Individually evaluated for impairment | ' | 12 |
Collectively evaluated for impairment | 9 | 11 |
Balance - Loans receivable | 11,631 | 11,265 |
Loan balance individually evaluated for impairment | ' | 12 |
Loan balance collectively evaluated for impairment | 11,631 | 11,253 |
Unallocated | ' | ' |
Allowance for Loan Losses: | ' | ' |
Balance - Allowance for loans losses | 127 | 41 |
Individually evaluated for impairment | ' | ' |
Collectively evaluated for impairment | $127 | $41 |
LOANS_RECEIVABLE_NET_Details_6
LOANS RECEIVABLE, NET (Details 6) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
N | N | |
Financing Receivable, Modifications [Line Items] | ' | ' |
Number of Loans | 8 | 10 |
Investment Before TDR Modification | $1,863 | $5,605 |
Investment After TDR Modification | 2,163 | 4,661 |
One-to four-family residential | ' | ' |
Financing Receivable, Modifications [Line Items] | ' | ' |
Number of Loans | 7 | 6 |
Investment Before TDR Modification | 1,170 | 2,336 |
Investment After TDR Modification | 1,168 | 2,336 |
Commercial real estate | ' | ' |
Financing Receivable, Modifications [Line Items] | ' | ' |
Number of Loans | 1 | 4 |
Investment Before TDR Modification | 693 | 3,269 |
Investment After TDR Modification | $995 | $2,325 |
ACCRUED_INTEREST_RECEIVABLE_De
ACCRUED INTEREST RECEIVABLE (Details) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Accrued interest receivable | $1,752 | $1,894 |
Loans | ' | ' |
Accrued interest receivable | 1,563 | 1,686 |
Investment Securities | ' | ' |
Accrued interest receivable | 51 | 91 |
Mortgage-backed Securities | ' | ' |
Accrued interest receivable | $138 | $117 |
PREMISES_AND_EQUIPMENT_Details
PREMISES AND EQUIPMENT (Details Narrative) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Depreciation expense | $927 | $935 |
Premises and equipment, net | 20,880 | 21,541 |
Hungaria Urban Renewal | Land | ' | ' |
Premises and equipment, net | 3,100 | 3,100 |
Hungaria Urban Renewal | Buildings and Improvements | ' | ' |
Premises and equipment, net | 11,000 | 11,400 |
Hungaria Urban Renewal | Furniture, Fixtures and Equipment | ' | ' |
Premises and equipment, net | $209 | $314 |
PREMISES_AND_EQUIPMENT_Details1
PREMISES AND EQUIPMENT (Details) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2013 |
In Thousands, unless otherwise specified | Land | Land | Buildings and Improvements | Buildings and Improvements | Buildings and Improvements | Buildings and Improvements | Furniture, Fixtures and Equipment | Furniture, Fixtures and Equipment | Furniture, Fixtures and Equipment | Furniture, Fixtures and Equipment | ||
Minimum | Maximum | Minimum | Maximum | |||||||||
Property, Plant and Equipment, Gross | $29,385 | $29,653 | $5,330 | $5,330 | $21,382 | $21,811 | ' | ' | $2,673 | $2,512 | ' | ' |
Less accumulated depreciation and amortization | -8,505 | -8,112 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Property, Plant and Equipment, Net | $20,880 | $21,541 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated Useful Lives | ' | ' | ' | ' | ' | ' | '10 years | '40 years | ' | ' | '5 years | '10 years |
OTHER_REAL_ESTATE_OWNED_Detail
OTHER REAL ESTATE OWNED (Details Narrative) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Other Real Estate Owned Details Narrative | ' | ' |
Other real estate owned ("OREO") | $14,756 | $13,381 |
Write-downs on other real estate owned | $42 | $148 |
DEPOSITS_Details_Narrative
DEPOSITS (Details Narrative) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Deposits Details Narrative | ' | ' |
Aggregate of deposit accounts with a minimum denomination of $100,000 | $296,000 | $238,300 |
Aggregated of certificate deposits with balance greater than $100,000 | $82,600 | $82,600 |
DEPOSITS_Details
DEPOSITS (Details) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Deposits Details | ' | ' |
Demand accounts | $98,345 | $50,897 |
Savings accounts | 53,291 | 55,293 |
NOW accounts | 40,500 | 44,312 |
Money market accounts | 107,351 | 107,555 |
Certificates of deposit | 125,696 | 129,716 |
Retirement accounts | 28,145 | 28,745 |
Deposits, Total | $453,328 | $416,518 |
DEPOSITS_Details_1
DEPOSITS (Details 1) (USD $) | Sep. 30, 2013 |
In Thousands, unless otherwise specified | |
Deposits Details 1 | ' |
2014 | $96,684 |
2015 | 27,727 |
2016 | 14,225 |
2017 | 7,856 |
2018 | 11,606 |
Thereafter | 649 |
Certificates of deposit (including retirement accounts) | $158,747 |
BORROWINGS_Details_Narrative
BORROWINGS (Details Narrative) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Debt Disclosure [Abstract] | ' | ' |
Long-term Federal Home Loan advances | $27,100 | $36,500 |
Weighted average interest rate | 3.21% | ' |
Available credit from FHLBNY | 61,300 | 43,600 |
Repurchase agreements | 5,000 | 5,000 |
Interest rate of repurchase agreements | 3.83% | ' |
Fair value of security collateral for repurchase agreements | $5,800 | ' |
BORROWINGS_Details
BORROWINGS (Details) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Year Ending September 30, | ' | ' |
2014 | $8,700 | ' |
2015 | 5,000 | ' |
2016 | 2,260 | ' |
2017 | 3,000 | ' |
2018 | 4,000 | ' |
Thereafter | 4,140 | ' |
Long term FHLBNY advances | $27,100 | $36,503 |
BORROWINGS_Details_1
BORROWINGS (Details 1) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Borrowings Details 1 | ' | ' |
Balance at end of year | ' | $1,400 |
Weighted average balance during the year | 2,721 | 911 |
Maximum month-end balance during the year | $15,500 | $8,750 |
Average interest rate during the year | 0.39% | 0.38% |
SERVICING_POLICY_Details_Narra
SERVICING POLICY (Details Narrative) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Servicing Policy Details Narrative | ' | ' |
Loans sold, servicing released | $0 | $0 |
Proceeds from the sales of loans | 4,957 | 9,209 |
Value of loans sold still being serviced | 18,200 | 20,800 |
SBA Loans being serviced | $8,800 | $6,300 |
SERVICING_POLICY_Details
SERVICING POLICY (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Servicing Policy Details | ' | ' |
Mortgage servicing rights, beginning balance | $279 | $235 |
Origination of mortgage servicing rights | 20 | 141 |
Amortization | -70 | -97 |
Mortgage servicing rights, ending balance | $229 | $279 |
INCOME_TAXES_Details_Narrative
INCOME TAXES (Details Narrative) (USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 |
Net change in valuation allowance | $49 |
Federal | ' |
Operating loss carry forwards | 4,200 |
Expiration year of operating loss carryfowards | '2029 |
Tax loss reserves, base year amount | 1,258 |
State | ' |
Operating loss carry forwards | 8,300 |
Expiration year of operating loss carryfowards | '2015 |
Valuation allowance | $183 |
INCOME_TAXES_Details
INCOME TAXES (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Income Taxes Details | ' | ' |
Current | ($63) | $20 |
Deferred | 83 | 101 |
Total income tax expense | $21 | $121 |
INCOME_TAXES_Details_1
INCOME TAXES (Details 1) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Reconciliation of income tax | ' | ' |
Income tax (benefit) expense at statutory tax rate | $97 | $214 |
Increase (decrease) resulting from: | ' | ' |
State income taxes, net of federal income tax benefit | 5 | 34 |
Tax-exempt income, net | -108 | -112 |
Nondeductible expenses | 3 | 4 |
Share based compensation | ' | 14 |
Employee stock ownership plan | -25 | -32 |
Increase (decrease) in valuation allowance | 49 | -26 |
Other, net | ' | 25 |
Total income tax expense | $21 | $121 |
INCOME_TAXES_Details_2
INCOME TAXES (Details 2) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Temporary Differences and Deferred Tax Effect | ' | ' |
Allowance for loan losses | $1,203 | $1,541 |
Deferred loan fees | 1,067 | 1,016 |
Employee benefits | 295 | 299 |
Charitable contributions | 18 | 13 |
Net operating losses | 1,912 | 1,727 |
Alternative minimum tax credit | 176 | 247 |
Unrealized loss, minimum pension liability | 348 | 627 |
Net unrealized losses, investment securities available-for-sale | 67 | ' |
OREO | 297 | 319 |
Straight line rent | 118 | 93 |
Gross deferred tax asset | 5,501 | 5,882 |
Depreciation | -1,469 | -1,573 |
Discount accretion on investments | -95 | -107 |
Net unrealized gains, investment securities available-for-sale | ' | -178 |
Unrealized gain, derivative contracts | ' | -22 |
Mortgage servicing rights | -92 | -111 |
Gross deferred tax liability | -1,656 | -1,991 |
Net deferred tax asset | 3,845 | 3,891 |
Valuation allowance | -183 | -134 |
Net deferred tax asset, included in other assets | $3,662 | $3,757 |
PENSION_PLAN_Details_Narrative
PENSION PLAN (Details Narrative) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Long-term investment objective, equities | 65.00% | ' |
Long-term investment objective, debt | 35.00% | ' |
Funding guidelines, description | ' | ' |
If the plan is underfunded under the Guidelines, the bond fund portion will be temporarily increased to 50% in order to lessen asset value volatility. When the plan is no longer underfunded, the bond fund portion will be decreased back to 35%. Asset rebalancing is performed at least annually, with interim adjustments made when the investment mix varies more than 5% from the target (i.e., a 10% target range). | ||
Weighted average discount rate | 5.00% | 4.00% |
Expected long-term rate of return on assets | 7.50% | 7.50% |
Expected contributions | $111 | ' |
Actuarial losses | 872 | 1,570 |
Acturial losses, income tax effects | 348 | 627 |
Acturial losses expected to be amortized within next year | $54 | ' |
Minimum | ' | ' |
Expected long-term rate of return on assets | 6.00% | ' |
Minimum | Equity Securities | ' | ' |
Expected long-term rate of return on assets | 7.00% | ' |
Target asset allocation | 40.00% | ' |
Minimum | Fixed Income Securities | ' | ' |
Expected long-term rate of return on assets | 2.00% | ' |
Target asset allocation | 30.00% | ' |
Maximum | ' | ' |
Expected long-term rate of return on assets | 10.00% | ' |
Maximum | Equity Securities | ' | ' |
Expected long-term rate of return on assets | 11.00% | ' |
Target asset allocation | 70.00% | ' |
Maximum | Fixed Income Securities | ' | ' |
Expected long-term rate of return on assets | 6.00% | ' |
Target asset allocation | 60.00% | ' |
PENSION_PLAN_Details
PENSION PLAN (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Pension Plan Details | ' | ' |
Projected benefit obligation, beginning | $4,156 | $3,719 |
Interest cost | 162 | 172 |
Actuarial (gain) loss | -507 | 438 |
Annuity payments and lump sum distributions | -181 | -173 |
Projected benefit obligation, end | 3,630 | 4,156 |
Change in plan assets | ' | ' |
Fair value of assets, beginning | 2,487 | 2,196 |
Actual return on plan assets | 252 | 296 |
Employer contributions | 172 | 168 |
Annuity payments and lump sum distributions | -181 | -173 |
Fair value of assets, end | 2,730 | 2,487 |
Funded status included with other liabilities | ($900) | ($1,669) |
PENSION_PLAN_Details_1
PENSION PLAN (Details 1) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Pension Plan Details 1 | ' | ' |
Interest cost on projected benefit obligation | $162 | $172 |
Expected return on plan assets | -186 | -161 |
Amortization of unrecognized net loss | 124 | 81 |
Net Pension Cost | $100 | $92 |
PENSION_PLAN_Details_2
PENSION PLAN (Details 2) | Sep. 30, 2013 | Sep. 30, 2012 |
Weighted average asset allocation (percentage) | 100.00% | 100.00% |
Total securities available for sale | ' | ' |
Weighted average asset allocation (percentage) | 37.00% | 42.00% |
Equity Securities | ' | ' |
Weighted average asset allocation (percentage) | 62.00% | 58.00% |
Other (Money Market Fund) | ' | ' |
Weighted average asset allocation (percentage) | 1.00% | 0.00% |
PENSION_PLAN_Details_3
PENSION PLAN (Details 3) (USD $) | Sep. 30, 2013 |
In Thousands, unless otherwise specified | |
Benefit payments expected to be paid | ' |
October 1, 2013 through September 30, 2014 | $194 |
October 1, 2014 through September 30, 2015 | 197 |
October 1, 2015 through September 30, 2016 | 197 |
October 1, 2016 through September 30, 2017 | 198 |
October 1, 2017 through September 30, 2018 | 198 |
October 1, 2018 through September 30, 2023 | 998 |
Benefit payments expected to be paid, total | $1,982 |
PENSION_PLAN_Details_4
PENSION PLAN (Details 4) (Fair Value, Measurements, Recurring, USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Fair Value | ' | ' |
Investment Type Mutual Funds- Equity | ' | ' |
Large-Cap Value | $320 | $270 |
Large-Cap Core | 323 | 278 |
Mid-Cap Core | 161 | 129 |
Small-Cap Core | 165 | 130 |
Non-U.S. Core | 717 | 628 |
Investment Type Mutual Funds- Fixed Income | ' | ' |
Intermediate-Term Core | 1,006 | 1,051 |
Cash Equivalents | ' | ' |
Money Market | 38 | 1 |
Total Investment | 2,730 | 2,487 |
Level 1 | ' | ' |
Investment Type Mutual Funds- Equity | ' | ' |
Large-Cap Value | 320 | 270 |
Large-Cap Core | 323 | 278 |
Mid-Cap Core | 161 | 129 |
Small-Cap Core | 165 | 130 |
Non-U.S. Core | 717 | 628 |
Investment Type Mutual Funds- Fixed Income | ' | ' |
Intermediate-Term Core | 1,006 | 1,051 |
Cash Equivalents | ' | ' |
Money Market | 38 | 1 |
Total Investment | $2,730 | $2,487 |
NONQUALIFIED_COMPENSATION_PLAN1
NONQUALIFIED COMPENSATION PLAN (Details Narrative) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Nonqualified Compensation Plan Details Narrative | ' | ' |
Director Emeritus Plan description | 'In 2001, the Company adopted a New Director Emeritus Plan (the "New Plan"), which supplemented the prior Director Emeritus Plans. Under the New Plan, the directors will be entitled to a benefit upon attainment of his/her benefit age. The directors will receive an annual amount in monthly installments based on his/her total Board and Committee fees in the twelve months prior to attainment of his/her benefit age. The amount will be ten percent (10%) plus two and one-half percent (2 1/2%) for each year of service as a Director, with a minimum of fifty percent (50%), provided the Director has served for at least five (5) years, and a maximum of sixty percent (60%). The maximum benefit increases for any Director serving as Chairman of the Board to seventy-five percent (75%). | ' |
Life Insurance Contracts, Value | $10,342 | $10,010 |
401K_EMPLOYEE_CONTRIBUTION_PLA1
401(K) EMPLOYEE CONTRIBUTION PLAN (Details Narrative) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
K Employee Contribution Plan Details Narrative | ' | ' |
Employer's contribution to the plan | $38 | $0 |
COMMITMENTS_Details_Narrative
COMMITMENTS (Details Narrative) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Commitments Details Narrative | ' | ' |
Rental Expense | $739 | $789 |
COMMITMENTS_Details
COMMITMENTS (Details) (USD $) | Sep. 30, 2013 |
In Thousands, unless otherwise specified | |
Due September 30, | ' |
2014 | $568 |
2015 | 568 |
2016 | 588 |
2017 | 627 |
2018 | 627 |
Thereafter | 5,011 |
Future minimum payments under non-cancelable operating leases | $7,989 |
FINANCIAL_INSTRUMENTS_WITH_OFF2
FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK (Details Narrative) (USD $) | 1 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Apr. 30, 2008 | Sep. 30, 2012 |
Financial Instruments With Off-Balance Sheet Risk Details Narrative | ' | ' |
Interest rate collar unwound | $10,000 | ' |
Termination fee | 817 | ' |
Book value of interest rate collar | 112 | ' |
Unrealized gain on interest rate collar | 705 | ' |
Book value of unwound derivative | ' | 54 |
Other comprehensive loss - unwound derivative | ' | 33 |
Other comprehensive loss - deferred tax of unwound derivative | ' | $21 |
FINANCIAL_INSTRUMENTS_WITH_OFF3
FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK (Details) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ' | ' |
Financial instruments - contract amounts | $49,804 | $58,712 |
Unused lines of credit | ' | ' |
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ' | ' |
Financial instruments - contract amounts | 38,823 | 41,162 |
Fixed rate loan commitments | ' | ' |
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ' | ' |
Financial instruments - contract amounts | 2,546 | 1,988 |
Letters of credit | ' | ' |
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ' | ' |
Financial instruments - contract amounts | 1,450 | 1,450 |
Variable rate loan commitments | ' | ' |
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ' | ' |
Financial instruments - contract amounts | $6,985 | $14,112 |
FAIR_VALUE_DISCLOSURES_Details
FAIR VALUE DISCLOSURES (Details Narrative) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Total Unpaid Contractual Principal Balance | $29,147 | $24,269 |
Write-down of impaired loans | -3,260 | -1,466 |
Specific loss reserves | 542 | 932 |
Impaired Loans | ' | ' |
Number of impaired loans | 23 | ' |
Total Unpaid Contractual Principal Balance | 11,600 | ' |
Cumulative write-down of impaired loans | 2,700 | ' |
Write-down of impaired loans | 1,800 | ' |
Specific loss reserves | $542 | ' |
FAIR_VALUE_DISCLOSURES_Details1
FAIR VALUE DISCLOSURES (Details) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Fair value measured on recurring basis: | ' | ' |
Securities available for sale | $15,774 | $16,786 |
Obligations of U.S. government agencies Mortgage backed securities - residential | ' | ' |
Fair value measured on recurring basis: | ' | ' |
Securities available for sale | 1,556 | 1,861 |
Obligations of U.S. government-sponsored enterprises Mortgage backed securities - residential | ' | ' |
Fair value measured on recurring basis: | ' | ' |
Securities available for sale | 9,401 | 8,575 |
Obligations of U.S. government-sponsored enterprises Mortgage backed securities -commercial | ' | ' |
Fair value measured on recurring basis: | ' | ' |
Securities available for sale | 4,002 | 4,228 |
Private label mortgage-backed securities-residential | ' | ' |
Fair value measured on recurring basis: | ' | ' |
Securities available for sale | 815 | 1,055 |
Obligations of U.S. government-sponsored enterprises Debt securities | ' | ' |
Fair value measured on recurring basis: | ' | ' |
Securities available for sale | ' | 1,067 |
Fair Value, Measurements, Recurring | Level 2 | ' | ' |
Fair value measured on recurring basis: | ' | ' |
Securities available for sale | 15,774 | 16,786 |
Fair Value, Measurements, Recurring | Level 2 | Obligations of U.S. government agencies Mortgage backed securities - residential | ' | ' |
Fair value measured on recurring basis: | ' | ' |
Securities available for sale | 1,556 | 1,861 |
Fair Value, Measurements, Recurring | Level 2 | Obligations of U.S. government-sponsored enterprises Mortgage backed securities - residential | ' | ' |
Fair value measured on recurring basis: | ' | ' |
Securities available for sale | 9,401 | 8,575 |
Fair Value, Measurements, Recurring | Level 2 | Obligations of U.S. government-sponsored enterprises Mortgage backed securities -commercial | ' | ' |
Fair value measured on recurring basis: | ' | ' |
Securities available for sale | 4,002 | 4,228 |
Fair Value, Measurements, Recurring | Level 2 | Private label mortgage-backed securities-residential | ' | ' |
Fair value measured on recurring basis: | ' | ' |
Securities available for sale | 815 | 1,055 |
Fair Value, Measurements, Recurring | Level 2 | Obligations of U.S. government-sponsored enterprises Debt securities | ' | ' |
Fair value measured on recurring basis: | ' | ' |
Securities available for sale | ' | $1,067 |
FAIR_VALUE_DISCLOSURES_Details2
FAIR VALUE DISCLOSURES (Details 1) (Fair Value Measured on a Nonrecurring Basis, USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Fair Value | ' | ' |
Impaired loans | $8,534 | $5,984 |
Other real estate owned | 230 | 464 |
Assets measured at fair value on a non-recurring basis | 8,764 | 6,448 |
Level 3 | ' | ' |
Impaired loans | 8,534 | 5,984 |
Other real estate owned | 230 | 464 |
Assets measured at fair value on a non-recurring basis | $8,764 | $6,448 |
FAIR_VALUE_DISCLOSURES_Details3
FAIR VALUE DISCLOSURES (Details 2) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | |
Impaired Loans | Weighted Average | ' | |
Fair value input- appraisal of collateral | -6.04% | |
Impaired Loans | Minimum | ' | |
Fair value input- appraisal of collateral | 0.00% | |
Impaired Loans | Maximum | ' | |
Fair value input- appraisal of collateral | -8.00% | |
Impaired Loans | Fair Value Measured on a Nonrecurring Basis | ' | |
Fair value estimate | 8,534 | |
Valuation techniques and Unobservable Input | 'Appraisal of collateral; Liquidation expenses | [1],[2] |
Other Real Estate Owned | Weighted Average | ' | |
Fair value input- appraisal of collateral | 15.40% | |
Other Real Estate Owned | Fair Value Measured on a Nonrecurring Basis | ' | |
Fair value estimate | 230 | |
Valuation techniques and Unobservable Input | 'Appraisal of collateral; Appraisal adjustments | [1],[2],[3] |
[1] | Fair value is generally determined through independent appraisals for the underlying collateral, which generally include various level 3 inputes which are not identifiable. | |
[2] | Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated liquidation expenses. The range and weighted average of liquidation expenses and other appraisal adjustments are presented as a percent of the appraisal. | |
[3] | Includes qualitative adjustments by management and estimated liquidation expenses. |
FAIR_VALUE_DISCLOSURES_Details4
FAIR VALUE DISCLOSURES (Details 3) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Financial instruments - assets | ' | ' |
Fair value of investment securities - held to maturity | $51,802 | $42,130 |
Carrying Amount | ' | ' |
Financial instruments - assets | ' | ' |
Fair value of investment securities - held to maturity | 52,558 | 41,068 |
Loans | 396,800 | 385,270 |
Financial instruments - liabilities | ' | ' |
Certificate of deposit | 153,841 | 158,461 |
Borrowings | 32,100 | 41,503 |
Fair Value | ' | ' |
Financial instruments - assets | ' | ' |
Fair value of investment securities - held to maturity | 51,802 | 42,130 |
Loans | 401,064 | 396,111 |
Financial instruments - liabilities | ' | ' |
Certificate of deposit | 155,306 | 160,753 |
Borrowings | 33,430 | 43,898 |
Level 2 | ' | ' |
Financial instruments - assets | ' | ' |
Fair value of investment securities - held to maturity | 51,802 | 42,130 |
Financial instruments - liabilities | ' | ' |
Certificate of deposit | 155,306 | 160,753 |
Borrowings | 33,430 | 43,898 |
Level 3 | ' | ' |
Financial instruments - assets | ' | ' |
Loans | $401,064 | $396,111 |
REGULATORY_CAPITAL_Details
REGULATORY CAPITAL (Details) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Magyar Bancorp, Inc. | ' | ' |
Total Capital | $48,948 | $49,439 |
Total Capital (to risk-weighted assets) ratio | 13.24% | 13.93% |
Minimum amount of capital for adequacy purposes | 29,584 | 28,402 |
Minimum amount of capital for adequacy purposes, ratio | 8.00% | 8.00% |
Tier 1 Capital (to risk-weighted assets) | ' | ' |
Tier 1 Capital | 45,935 | 45,581 |
Tier 1 Capital (to risk-weighted assets) ratio | 12.42% | 12.84% |
Minimum amount of Tier 1 Capital for adequacy purposes | 14,792 | 14,201 |
Minimum amount of Tier 1 Capital for adequacy purposes, ratio | 4.00% | 4.00% |
Tier 1 Capital | 45,935 | 45,581 |
Tier 1 Capital (to average assets) ratio | 8.61% | 8.90% |
Minimum amount of Tier 1 Capital for adequacy purposes | 21,341 | 20,492 |
Minimum amount of Tier 1 Capital for adequacy purposes, ratio | 4.00% | 4.00% |
Magyar Bank | ' | ' |
Total Capital | 46,313 | 46,897 |
Total Capital (to risk-weighted assets) ratio | 12.52% | 13.21% |
Minimum amount of capital for adequacy purposes | 29,582 | 28,400 |
Minimum amount of capital for adequacy purposes, ratio | 8.00% | 8.00% |
Minimum Capital required to be well-capitalized | 36,977 | 35,500 |
Minimum Capital required to be well-capitalized, ratio | 10.00% | 10.00% |
Tier 1 Capital (to risk-weighted assets) | ' | ' |
Tier 1 Capital | 43,300 | 43,039 |
Tier 1 Capital (to risk-weighted assets) ratio | 11.71% | 12.12% |
Minimum amount of Tier 1 Capital for adequacy purposes | 14,791 | 14,200 |
Minimum amount of Tier 1 Capital for adequacy purposes, ratio | 4.00% | 4.00% |
Minimum Tier 1 Capital required to be well-capitalized | 22,186 | 21,300 |
Minimum Tier 1 Capital required to be well-capitalized, ratio | 6.00% | 6.00% |
Tier 1 Capital | 43,300 | 43,039 |
Tier 1 Capital (to average assets) ratio | 8.12% | 8.40% |
Minimum amount of Tier 1 Capital for adequacy purposes | 21,340 | 20,491 |
Minimum amount of Tier 1 Capital for adequacy purposes, ratio | 4.00% | 4.00% |
Minimum Tier 1 Capital required to be well-capitalized | $26,676 | $25,614 |
Minimum Tier 1 Capital required to be well-capitalized, ratio | 5.00% | 5.00% |