Loans | Loans Loans consist of the following at the dates indicated: September 30, 2017 June 30, 2017 Retail consumer loans: One-to-four family $ 684,956 $ 684,089 HELOCs - originated 152,979 157,068 HELOCs - purchased 162,518 162,407 Construction and land/lots 54,969 50,136 Indirect auto finance 142,915 140,879 Consumer 8,814 7,900 Total retail consumer loans 1,207,151 1,202,479 Commercial loans: Commercial real estate 753,857 730,408 Construction and development 209,672 197,966 Commercial and industrial 124,722 120,387 Municipal leases 100,638 101,175 Total commercial loans 1,188,889 1,149,936 Total loans 2,396,040 2,352,415 Deferred loan costs (fees), net (1,285 ) (945 ) Total loans, net of deferred loan fees 2,394,755 2,351,470 Allowance for loan losses (21,997 ) (21,151 ) Loans, net $ 2,372,758 $ 2,330,319 All qualifying one-to-four family first mortgage loans, HELOCs, commercial real estate loans, and FHLB Stock are pledged as collateral by a blanket pledge to secure any outstanding FHLB advances. The Company's total non-purchased and purchased performing loans by segment, class, and risk grade at the dates indicated follow: Pass Special Mention Substandard Doubtful Loss Total September 30, 2017 Retail consumer loans: One-to-four family $ 656,596 $ 4,823 $ 14,403 $ 1,157 $ 130 $ 677,109 HELOCs - originated 149,407 799 2,287 176 22 152,691 HELOCs - purchased 162,327 — 191 — — 162,518 Construction and land/lots 53,703 398 351 — — 54,452 Indirect auto finance 142,671 — 244 — — 142,915 Consumer 8,752 10 23 2 9 8,796 Commercial loans: Commercial real estate 726,440 5,654 6,194 — — 738,288 Construction and development 204,311 508 2,217 — — 207,036 Commercial and industrial 118,314 952 2,876 — 1 122,143 Municipal leases 100,223 309 106 — — 100,638 Total loans $ 2,322,744 $ 13,453 $ 28,892 $ 1,335 $ 162 $ 2,366,586 Pass Special Mention Substandard Doubtful Loss Total June 30, 2017 Retail consumer loans: One-to-four family $ 655,424 $ 4,715 $ 14,769 $ 1,101 $ 11 $ 676,020 HELOCs - originated 153,676 809 2,100 188 7 156,780 HELOCs - purchased 162,215 — 192 — — 162,407 Construction and land/lots 48,728 479 341 60 — 49,608 Indirect auto finance 140,780 — 97 1 1 140,879 Consumer 7,828 12 34 — 8 7,882 Commercial loans: Commercial real estate 700,060 5,847 7,118 — — 713,025 Construction and development 192,025 992 2,320 — — 195,337 Commercial and industrial 113,923 883 2,954 — 1 117,761 Municipal leases 99,811 1,258 106 — — 101,175 Total loans $ 2,274,470 $ 14,995 $ 30,031 $ 1,350 $ 28 $ 2,320,874 The Company's total PCI loans by segment, class, and risk grade at the dates indicated follow: Pass Special Mention Substandard Doubtful Loss Total September 30, 2017 Retail consumer loans: One-to-four family $ 3,036 $ 1,152 $ 3,469 $ 190 $ — $ 7,847 HELOCs - originated 257 — 31 — — 288 Construction and land/lots 475 — 42 — — 517 Consumer 3 15 — — — 18 Commercial loans: Commercial real estate 7,924 1,609 6,036 — — 15,569 Construction and development 335 — 2,301 — — 2,636 Commercial and industrial 2,430 32 117 — — 2,579 Total loans $ 14,460 $ 2,808 $ 11,996 $ 190 $ — $ 29,454 Pass Special Mention Substandard Doubtful Loss Total June 30, 2017 Retail consumer loans: One-to-four family $ 3,115 $ 1,129 $ 3,615 $ 210 $ — $ 8,069 HELOCs - originated 258 — 30 — — 288 Construction and land/lots 487 — 41 — — 528 Consumer 4 14 — — — 18 Commercial loans: Commercial real estate 8,909 2,299 6,175 — — 17,383 Construction and development 338 — 2,291 — — 2,629 Commercial and industrial 2,460 44 122 — — 2,626 Total loans $ 15,571 $ 3,486 $ 12,274 $ 210 $ — $ 31,541 The Company's total loans by segment, class, and delinquency status at the dates indicated follows: Past Due Total 30-89 Days 90 Days+ Total Current Loans September 30, 2017 Retail consumer loans: One-to-four family $ 4,799 $ 3,805 $ 8,604 $ 676,352 $ 684,956 HELOCs - originated 601 941 1,542 151,437 152,979 HELOCs - purchased — — — 162,518 162,518 Construction and land/lots 211 64 275 54,694 54,969 Indirect auto finance 377 6 383 142,532 142,915 Consumer 5 8 13 8,801 8,814 Commercial loans: Commercial real estate 1,091 3,497 4,588 749,269 753,857 Construction and development 141 1,216 1,357 208,315 209,672 Commercial and industrial 84 834 918 123,804 124,722 Municipal leases — — — 100,638 100,638 Total loans $ 7,309 $ 10,371 $ 17,680 $ 2,378,360 $ 2,396,040 The table above includes PCI loans of $898 30-89 days past due and $3,875 90 days or more past due as of September 30, 2017 . Past Due Total 30-89 Days 90 Days+ Total Current Loans June 30, 2017 Retail consumer loans: One-to-four family $ 3,496 $ 3,990 $ 7,486 $ 676,603 $ 684,089 HELOCs - originated 1,037 274 1,311 155,757 157,068 HELOCs - purchased — — — 162,407 162,407 Construction and land/lots 132 129 261 49,875 50,136 Indirect auto finance 96 — 96 140,783 140,879 Consumer 5 14 19 7,881 7,900 Commercial loans: Commercial real estate 809 3,100 3,909 726,499 730,408 Construction and development 385 887 1,272 196,694 197,966 Commercial and industrial 37 831 868 119,519 120,387 Municipal leases — — — 101,175 101,175 Total loans $ 5,997 $ 9,225 $ 15,222 $ 2,337,193 $ 2,352,415 The table above includes PCI loans of $4,772 30-89 days past due and $4,211 90 days or more past due as of June 30, 2017 . The Company's recorded investment in loans, by segment and class, that are not accruing interest or are 90 days or more past due and still accruing interest at the dates indicated follow: September 30, 2017 June 30, 2017 Nonaccruing 90 Days + & still accruing Nonaccruing 90 Days + & still accruing Retail consumer loans: One-to-four family $ 6,557 $ — $ 6,453 $ — HELOCs - originated 1,404 — 1,291 — HELOCs - purchased 191 — 192 — Construction and land/lots 157 — 245 — Indirect auto finance 179 — 1 — Consumer 22 — 29 — Commercial loans: Commercial real estate 2,861 — 2,756 — Construction and development 1,787 — 1,766 — Commercial and industrial 821 — 827 — Municipal leases 106 — 106 — Total loans $ 14,085 $ — $ 13,666 $ — PCI loans totaling $6,491 at September 30, 2017 and $6,664 at June 30, 2017 are excluded from nonaccruing loans due to the accretion of discounts established in accordance with the acquisition method of accounting for business combinations. Troubled debt restructurings ("TDRs") are loans which have renegotiated loan terms to assist borrowers who are unable to meet the original terms of their loans. Such modifications to loan terms may include a lower interest rate, a reduction in principal, or a longer term to maturity. Additionally, all TDRs are considered impaired. The Company had no commitments to lend additional funds on these TDR loans at September 30, 2017 . The Company's loans that were performing under the payment terms of TDRs that were excluded from nonaccruing loans above at the dates indicated follow: September 30, 2017 June 30, 2017 Performing TDRs included in impaired loans $ 26,063 $ 27,043 An analysis of the allowance for loan losses by segment for the periods shown is as follows: Three Months Ended September 30, 2017 Three Months Ended September 30, 2016 PCI Retail Consumer Commercial Total PCI Retail Consumer Commercial Total Balance at beginning of period $ 727 $ 8,585 $ 11,839 $ 21,151 $ 361 $ 11,549 $ 9,382 $ 21,292 Provision for (recovery of) loan losses 470 (412 ) (58 ) — (5 ) (895 ) 900 — Charge-offs — (149 ) (14 ) (163 ) — (419 ) (607 ) (1,026 ) Recoveries — 286 723 1,009 — 211 474 685 Balance at end of period $ 1,197 $ 8,310 $ 12,490 $ 21,997 $ 356 $ 10,446 $ 10,149 $ 20,951 The Company's ending balances of loans and the related allowance, by segment and class, at the dates indicated follows: Allowance for Loan Losses Total Loans Receivable PCI Loans individually evaluated for impairment Loans collectively evaluated Total PCI Loans individually evaluated for impairment Loans collectively evaluated Total September 30, 2017 Retail consumer loans: One-to-four family $ 120 $ 1,008 $ 3,227 $ 4,355 $ 7,847 $ 10,777 $ 666,332 $ 684,956 HELOCs - originated — 58 1,310 1,368 288 43 152,648 152,979 HELOCs - purchased — — 815 815 — — 162,518 162,518 Construction and land/lots — 61 924 985 517 648 53,804 54,969 Indirect auto finance — — 847 847 — 8 142,907 142,915 Consumer — 9 51 60 18 2 8,794 8,814 Commercial loans: Commercial real estate 886 232 6,981 8,099 15,569 7,290 730,998 753,857 Construction and development 176 11 3,270 3,457 2,636 2,188 204,848 209,672 Commercial and industrial 15 380 1,136 1,531 2,579 1,805 120,338 124,722 Municipal leases — — 480 480 — 294 100,344 100,638 Total $ 1,197 $ 1,759 $ 19,041 $ 21,997 $ 29,454 $ 23,055 $ 2,343,531 $ 2,396,040 June 30, 2017 Retail consumer loans: One-to-four family $ 28 $ 863 $ 3,585 $ 4,476 $ 8,069 $ 10,305 $ 665,715 $ 684,089 HELOCs - originated — 44 1,340 1,384 288 12 156,768 157,068 HELOCs - purchased — — 838 838 — — 162,407 162,407 Construction and land/lots — 88 889 977 528 634 48,974 50,136 Indirect auto finance — 1 880 881 — 1 140,878 140,879 Consumer — 8 49 57 18 8 7,874 7,900 Commercial loans: Commercial real estate 512 239 6,600 7,351 17,383 6,284 706,741 730,408 Construction and development 171 13 2,982 3,166 2,629 2,184 193,153 197,966 Commercial and industrial 16 287 1,221 1,524 2,626 1,514 116,247 120,387 Municipal leases — — 497 497 — — 101,175 101,175 Total $ 727 $ 1,543 $ 18,881 $ 21,151 $ 31,541 $ 20,942 $ 2,299,932 $ 2,352,415 Loans acquired from acquisitions are initially excluded from the allowance for loan losses in accordance with the acquisition method of accounting for business combinations. The Company records these loans at fair value, which includes a credit discount, therefore, no allowance for loan losses are established for these acquired loans at acquisition. A provision for loan losses is recorded for any further deterioration in these acquired loans subsequent to the acquisition. The Company's impaired loans and the related allowance, by segment and class, at the dates indicated follows: Total Impaired Loans Unpaid Principal Balance Recorded Investment With a Recorded Allowance Recorded Investment With No Recorded Allowance Total Related Recorded Allowance September 30, 2017 Retail consumer loans: One-to-four family $ 28,064 $ 18,151 $ 6,727 $ 24,878 $ 1,022 HELOCs - originated 4,164 2,369 530 2,899 64 HELOCs - purchased 191 191 — 191 1 Construction and land/lots 2,435 1,104 463 1,567 62 Indirect auto finance 183 173 6 179 1 Consumer 533 10 26 36 9 Commercial loans: Commercial real estate 7,598 4,458 2,782 7,240 244 Construction and development 3,780 1,039 1,628 2,667 15 Commercial and industrial 7,044 1,176 881 2,057 383 Municipal leases 106 106 — 106 — Total impaired loans $ 54,098 $ 28,777 $ 13,043 $ 41,820 $ 1,801 June 30, 2017 Retail consumer loans: One-to-four family $ 28,469 $ 17,353 $ 7,773 $ 25,126 $ 881 HELOCs - originated 4,070 2,270 532 2,802 49 HELOCs - purchased 192 — 192 192 — Construction and land/lots 2,817 1,310 468 1,778 88 Indirect auto finance 22 — 1 1 1 Consumer 552 15 27 42 8 Commercial loans: Commercial real estate 8,307 4,721 3,186 7,907 253 Construction and development 3,768 1,024 1,617 2,641 16 Commercial and industrial 7,757 845 1,231 2,076 288 Municipal leases 400 106 294 400 — Total impaired loans $ 56,354 $ 27,644 $ 15,321 $ 42,965 $ 1,584 Impaired loans above excludes $6,491 at September 30, 2017 and $6,677 at June 30, 2017 in PCI loans due to the accretion of discounts established in accordance with the acquisition method of accounting for business combinations. The June 30, 2017 balance in the preceding sentence was previously disclosed as $13,425 . Based on further review, this amount was determined to be an error and was corrected during the quarter ended September 30, 2017. The error had no effect on the Company’s audited financial statements or other disclosures. The table above includes $18,765 and $22,023 , of impaired loans that were not individually evaluated at September 30, 2017 and June 30, 2017 , respectively, because these loans did not meet the Company's threshold for individual impairment evaluation. The recorded allowance above includes $42 and $41 related to these loans that were not individually evaluated at September 30, 2017 and June 30, 2017 , respectively. The Company's average recorded investment in impaired loans and interest income recognized on impaired loans for the three months ended September 30, 2017 and 2016 was as follows: Three Months Ended September 30, 2017 September 30, 2016 Average Recorded Investment Interest Income Recognized Average Recorded Investment Interest Income Recognized Retail consumer loans: One-to-four family $ 25,002 $ 294 $ 25,992 $ 326 HELOCs - originated 2,851 35 2,909 46 HELOCs - purchased 192 4 — — Construction and land/lots 1,673 28 1,402 32 Indirect auto finance 90 2 56 1 Consumer 39 4 24 5 Commercial loans: Commercial real estate 7,574 75 6,831 69 Construction and development 2,654 15 2,371 13 Commercial and industrial 2,067 20 3,869 45 Municipal leases 253 — 414 12 Total loans $ 42,395 $ 477 $ 43,868 $ 549 A summary of changes in the accretable yield for PCI loans for the three months ended September 30, 2017 and 2016 was as follows: Three Months Ended September 30, 2017 September 30, 2016 Accretable yield, beginning of period $ 7,080 $ 9,532 Reclass from nonaccretable yield (1) 200 887 Other changes, net (2) 27 (459 ) Interest income (610 ) (1,621 ) Accretable yield, end of period $ 6,697 $ 8,339 ______________________________________ (1) Represents changes attributable to expected losses assumptions. (2) Represents changes in cash flows expected to be collected due to the impact of modifications, changes in prepayment assumptions, and changes in interest rates. For the three months ended September 30, 2017 and 2016 , the following table presents a breakdown of the types of concessions made on TDRs by loan class: Three Months Ended September 30, 2017 Three Months Ended September 30, 2016 Number of Loans Pre Modification Outstanding Recorded Investment Post Modification Outstanding Recorded Investment Number of Loans Pre Modification Outstanding Recorded Investment Post Modification Outstanding Recorded Investment Extended term: Retail consumer: One-to-four family — $ — $ — 2 $ 119 $ 119 Total — $ — $ — 2 $ 119 $ 119 Other TDRs: Retail consumer: One-to-four family 10 $ 1,514 $ 1,514 3 $ 105 $ 105 HELOCs - originated — — — 1 3 3 Total 10 $ 1,514 $ 1,514 4 $ 108 $ 108 Total 10 $ 1,514 $ 1,514 6 $ 227 $ 227 The following table presents loans that were modified as TDRs within the previous 12 months and for which there was a payment default during the three months ended September 30, 2017 and 2016 : Three Months Ended September 30, 2017 Three Months Ended September 30, 2016 Number of Loans Recorded Investment Number of Loans Recorded Investment Extended payment terms: Retail consumer: One-to-four family — $ — 1 $ 39 Total — $ — 1 $ 39 Other TDRs: Retail consumer: One-to-four family 3 $ 372 3 $ 57 Commercial: Commercial real estate 1 672 — — Construction and development — — 2 371 Commercial and industrial — — 3 970 Total 4 $ 1,044 8 $ 1,398 Total 4 $ 1,044 9 $ 1,437 Other TDRs include TDRs that have a below market interest rate and extended payment terms. The Company does not typically forgive principal when restructuring troubled debt. In the determination of the allowance for loan losses, management considers TDRs for all loan classes, and the subsequent nonperformance in accordance with their modified terms, by measuring impairment based on either the value of the loan's expected future cash flows discounted at the loan's original effective interest rate or on the collateral value, net of the estimated costs of disposal, if the loan is collateral dependent. |