Document and Entity Information
Document and Entity Information | 3 Months Ended |
Mar. 31, 2024 shares | |
Document and Entity Information | |
Document Type | 10-Q |
Document Quarterly Report | true |
Document Period End Date | Mar. 31, 2024 |
Document Transition Report | false |
Entity File Number | 333-4028-LA |
Entity Registrant Name | MINISTRY PARTNERS INVESTMENT COMPANY, LLC |
Entity Incorporation, State or Country Code | CA |
Entity Tax Identification Number | 26-3959348 |
Entity Address, Address Line One | 915 West Imperial Highway |
Entity Address, Address Line Two | Suite 120 |
Entity Address, City or Town | Brea |
Entity Address, State or Province | CA |
Entity Address, Postal Zip Code | 92821 |
City Area Code | (714) |
Local Phone Number | 671-5720 |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Filer Category | Non-accelerated Filer |
Entity Small Business | true |
Entity Emerging Growth Company | false |
Entity Shell Company | false |
Entity Common Stock, Shares Outstanding | 146,522 |
Entity Central Index Key | 0000944130 |
Current Fiscal Year End Date | --12-31 |
Document Fiscal Year Focus | 2024 |
Document Fiscal Period Focus | Q1 |
Amendment Flag | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Assets: | ||
Cash and cash equivalents | $ 11,193 | $ 10,854 |
Restricted cash | 1,760 | 1,757 |
Certificates of deposit | 1,251 | 1,279 |
Loans receivable, net of allowance for expected credit losses of $1,449 and $1,501 as of March 31, 2024 and December 31, 2023, respectively | 99,901 | 98,573 |
Accrued interest receivable | 464 | 432 |
Investment in joint venture | 870 | 871 |
Other investments | 1,053 | 1,052 |
Property and equipment, net | 95 | 56 |
Foreclosed assets, net | 301 | 301 |
Servicing assets | 88 | 98 |
Other assets | 971 | 1,374 |
Total assets | 117,947 | 116,647 |
Liabilities: | ||
Lines of credit | 7,500 | 4,500 |
Other secured borrowings | 7 | 7 |
Debt certificates payable, net of debt issuance costs of $130 and $52 as of March 31, 2024 and December 31, 2023, respectively | 95,590 | 96,979 |
Accrued interest payable | 361 | 383 |
Other liabilities | 1,896 | 1,683 |
Total liabilities | 105,354 | 103,552 |
Members' Equity: | ||
Series A preferred units, 1,000,000 units authorized, 117,100 units issued and outstanding at March 31, 2024 and December 31, 2023 (liquidation preference of $100 per unit); See Note 13 | 11,715 | 11,715 |
Class A common units, 1,000,000 units authorized, 146,522 units issued and outstanding at March 31, 2024 and December 31, 2023; See Note 13 | 1,509 | 1,509 |
Net assets of Ministry Partners for Christ, with donor restrictions | 1,700 | |
Accumulated deficit | (2,331) | (129) |
Total members' equity | 12,593 | 13,095 |
Total liabilities and members' equity | $ 117,947 | $ 116,647 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Consolidated Balance Sheets | ||
Allowance for expected credit losses | $ 1,449 | $ 1,501 |
Debt securities payable, debt issuance costs | $ 130 | $ 52 |
Preferred units - Series A, units authorized | 1,000,000 | 1,000,000 |
Preferred units - Series A, units issued | 117,100 | 117,100 |
Preferred units - Series A, units outstanding | 117,100 | 117,100 |
Preferred units - Series A, liquidation preference per unit | $ 100 | $ 100 |
Common units - Class A, units authorized | 1,000,000 | 1,000,000 |
Common units - Class A, units issued | 146,522 | 146,522 |
Common units - Class A, units outstanding | 146,522 | 146,522 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Interest income: | ||
Interest on loans | $ 1,660 | $ 1,297 |
Interest on interest-bearing accounts | 151 | 88 |
Total interest income | 1,811 | 1,385 |
Interest expense: | ||
Debt certificates | 1,182 | 860 |
Other debt | 83 | 58 |
Total interest expense | 1,265 | 918 |
Net interest income | 546 | 467 |
Provision (credit) for expected credit loss | (52) | (162) |
Net interest income after credit for expected credit losses | 598 | 629 |
Non-interest income: | ||
Broker-dealer commissions and fees | 175 | 215 |
Other income | 36 | 63 |
Charitable contributions, with donor restrictions | 400 | |
Total non-interest income | 211 | 678 |
Non-interest expenses: | ||
Salaries and benefits | 527 | 762 |
Marketing and promotion | 21 | 27 |
Office occupancy | 47 | 47 |
Office operations and other expenses | 393 | 412 |
Foreclosed assets, net | 10 | 4 |
Legal and accounting | 155 | 118 |
Total non-interest expenses | 1,153 | 1,370 |
Loss before provision for income taxes | (344) | (63) |
Provision for income taxes and state LLC fees | 5 | 5 |
Net loss | $ (349) | $ (68) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net Income (Loss) | $ (349) | $ (68) |
Adjustments to reconcile net loss to net cash provided (used) by operating activities: | ||
Depreciation | 17 | 11 |
Amortization of deferred loan fees | (23) | (14) |
Amortization of debt issuance costs | 17 | 20 |
Credit for expected credit losses | (52) | (162) |
Accretion of loan discount | (3) | (3) |
Gain on sale of loans | (7) | |
Loss on retirement of fixed assets | 2 | |
Gain on other investments | (1) | (1) |
Adoption of new accounting standard | (112) | |
Changes in: | ||
Accrued interest receivable | (32) | 93 |
Other assets | 415 | (119) |
Accrued interest payable | (21) | 33 |
Other liabilities | 207 | (331) |
Net cash provided (used) by operating activities | 177 | (660) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Loan purchases | (10) | (2,545) |
Loan originations | (3,126) | (25) |
Loan sales | 7 | |
Loan principal collections | 1,886 | 2,014 |
Purchase of certificates of deposit | 27 | |
Purchase of property and equipment | (58) | |
Net cash (used) by investing activities | (1,281) | (549) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Borrowings, net of repayments on lines of credit | 3,000 | |
Net change in debt certificates payable | (1,311) | 8,966 |
Debt issuance costs | (95) | (24) |
Dividends paid on preferred units | (148) | (182) |
Net cash provided by financing activities | 1,446 | 8,760 |
Net increase in cash and restricted cash | 342 | 7,551 |
Cash, cash equivalents, and restricted cash at beginning of period | 12,611 | 9,564 |
Cash, cash equivalents, and restricted cash at end of period | 12,953 | 17,115 |
Supplemental disclosures of cash flow information | ||
Interest paid | 1,286 | 885 |
Income taxes paid | 12 | |
Supplemental disclosures of non-cash transactions | ||
Servicing assets recorded | 9 | |
Leased assets obtained in exchange of new operating lease liabilities | 387 | |
Lease liabilities recorded | 387 | |
Dividends declared to preferred unit holders | $ 153 | $ 160 |
Nature of Business and Summary
Nature of Business and Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2024 | |
Accounting Policies [Abstract] | |
Nature of Business and Summary of Significant Accounting Policies | MINISTRY PARTNERS INVESTMENT COMPANY, LLC NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The accounting and financial reporting policies of MINISTRY PARTNERS INVESTMENT COMPANY, LLC and its wholly owned subsidiaries, Ministry Partners Funding, LLC, MP Realty Services, Inc., Ministry Partners Securities, LLC, and Ministry Partners for Christ, Inc. conform to accounting principles generally accepted in the United States and general financial industry practices. The accompanying interim consolidated financial statements have not been audited. The Company’s 2023 annual report filed on Form 10-K provides a more detailed description of its accounting policies. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, and cash flows as of March 31, 2024, and for the three months ended March 31, 2024 and 2023, have been made. Certain information and note disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. The results of operations for the periods ended March 31, 2024 and 2023 are not necessarily indicative of the results for the full year. Note 1: Nature of Business and Summary of Significant Accounting Policies Nature of Business Throughout these notes to consolidated financial statements, we refer to Ministry Partners Investment Company, LLC and its subsidiaries as “the Company.” Formed in California in 1991, the Company is a financial services organization specializing in both financing ministries through funding commercial real property secured loans and providing investment services to the Christian community. The Company funds its investments in ministry loans primarily through the sale of debt certificates. The Company’s wholly-owned subsidiaries are: ● Ministry Partners Funding, LLC, a Delaware limited liability company (“ MPF ”); ● MP Realty Services, Inc., a California corporation (“ MP Realty ”); ● Ministry Partners Securities, LLC, a Delaware limited liability company (“ MP Securities ”); and ● Ministry Partners for Christ, Inc., a not-for-profit Delaware corporation (“ MPC ”). The Company formed MPF in 2007 and then deactivated the subsidiary on November 30, 2009. In December 2014, the Company reactivated MPF to enable it to serve as collateral agent for loans held as collateral for its Secured Investment Certificates. The Company formed MP Realty in November 2009, and obtained a license to operate as a corporate real estate broker through the California Department of Real Estate on February 23, 2010. MP Realty has conducted limited operations to date. The Company formed MP Securities on April 26, 2010, to provide investment and financial planning solutions for individuals, churches, charitable institutions, and faith-based organizations. MP Securities acts as the selling agent for the Company’s public and private placement notes. The Company formed MPC on December 28, 2018, to be used exclusively for religious and charitable purposes within the meaning of Section 501(c)(3) of the U.S. Internal Revenue Code of 1986 (“ IRC ”). MPC is a not-for-profit corporation formed and organized under Delaware law. MPC makes charitable grants to Christian educational organizations, and provides accounting, consulting, and financial expertise to aid Christian ministries. On August 23, 2019, the Internal Revenue Service granted MPC tax-exempt status as a private foundation under Section 501(c)(3) of the IRC. The MPC Board of Directors approved its first charitable grants during the year ended December 31, 2020. Principles of Consolidation The consolidated financial statements include the accounts of Ministry Partners Investment Company, LLC and its wholly-owned subsidiaries. Management eliminates all significant inter-company balances and transactions in consolidation. Conversion to LLC Effective December 31, 2008, the Company converted from a corporation organized under California law to a California limited liability company. After this conversation, the separate existence of Ministry Partners Investment Corporation ceased and the entity continued by operation of law under the name Ministry Partners Investment Company, LLC. As an LLC, a group of managers provides oversight of the Company’s affairs. The managers have full, exclusive, and complete discretion, power, and authority to oversee the management of Company affairs. An Operating Agreement governs the Company’s management structure and governance procedures. Risks and Uncertainties COVID-19, a global pandemic, adversely impacted the broad economy, affecting most industries, including businesses, schools, hospitality-, and travel-based employers, and disrupted the supply and distribution networks that deliver products to the consuming public. While the pandemic has ended, we cannot know at this time if there will be any negative long-term effects to in-person attendance and giving trends at faith-based organizations and churches. Negative attendance and giving trends impacting the organizations that the Company serves could have a material financial impact on the Company. In addition, Russia’s invasion of Ukraine, increasing current levels of inflation, the disruption of global supply chains, rising interest rates, and recent bank failures are putting strain on the U.S. economy and the U.S. consumer. While it is not possible to know the full extent of the long-term impact of these current events, the Company is disclosing potentially material factors that could impact our business of which it is aware. Cash, and Cash Equivalents Cash equivalents include time deposits, and all highly liquid debt instruments with original maturities of three months or less. The Company had demand deposits and money market deposit accounts as of March 31, 2024 and December 31, 2023. The National Credit Union Share Insurance Fund insures a portion of the Company’s cash held at credit unions, and the Federal Deposit Insurance Corporation insures a portion of cash held by the Company at other financial institutions. The Company holds cash deposits that may exceed insured limits. Management does not expect to incur losses in these cash accounts. The Company maintains cash accounts with Royal Bank of Canada Dain Rauscher (“ RBC Dain CRD ACCU Certificates of Deposit Certificates of deposit include investments in certificates of deposit held at financial institutions that carry original maturities of greater than three months. The Company had $1.3 million in certificates with terms of greater than three months as of March 31, 2024, and December 31, 2023. Use of Estimates The Company’s creation of consolidated financial statements that conform to United States Generally Accepted Accounting Principles (" GAAP ") requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. These estimates govern areas such as the allowance for credit losses and the fair value of financial instruments and foreclosed assets. Actual results could differ from these estimates. Investments in Joint Venture In 2016, the Company entered into a joint venture agreement to develop and sell property we acquired as part of a Deed in Lieu of Foreclosure agreement reached with one of our borrowers. The joint venture owns a property located in Santa Clarita, California. The Company accounts for its investment in the joint venture using the equity method of accounting. Under this method, the Company records its proportionate share of the joint venture’s net income or loss in the statement of operations. On a periodic basis, or whenever events or circumstances arise that would necessitate analysis, management analyzes the Company’s investment in the joint venture for impairment. In this analysis, management compares the carrying value of the investment to the estimated value of the underlying real property. The Company records any impairment charges as a valuation allowance against the value of the asset. Management records these valuation changes as realized gains or losses on investment on the Company’s consolidated statements of operations. Management determined that investment in the joint venture was not impaired as of March 31, 2024. Other Investments In June 2022, MP Securities purchased two ten-year fixed annuities from insurance companies. These annuities each carry unique features, including guaranteed fixed income components, variable income components, premium bonuses, and potential withdrawal charges. The Company carries these investments at cost and adjusts for guaranteed income when such income is realized. The principal balances of these annuities are guaranteed but are not insured; however, management determined that the annuities were not impaired as of March 31, 2024, and December 31, 2023, and does not anticipate losses. Loans Receivable The Company reports loans that management has the intent and ability to hold for the foreseeable future at their outstanding unpaid principal balance adjusted for an allowance for expected credit losses, deferred loan fees and costs, and loan discounts. Interest Accrual on Loans Receivable The Company accrues loan interest income daily. Management defers loan origination fees and costs generated in making a loan. The Company amortizes these fees and costs as an adjustment to the related loan yield using the interest method. Loan discounts can arise from interest accrued and unpaid which the Company adds to loan principal balances when it modifies the loan. The Company does not accrete discounts to income on impaired loans. However, when management determines that a previously impaired loan is no longer impaired, the Company begins accreting loan discounts to interest income over the term of the modified loan. For loans purchased from third parties, loan discounts include differences between the purchase price and the recorded principal balance of the loan. The Company accretes these discounts to interest income over the term of the loan using the interest method. Management considers a loan impaired if it concludes that the collection of principal or interest according to the terms of the loan agreement is doubtful. The Company stops the accrual of interest when management determines the loan is impaired. For loans that the Company places on non-accrual status, management reverses all uncollected accrued interest against interest income. Management accounts for the interest on these loans on the cash basis or cost-recovery method until the loan qualifies for return to accrual status. It is not until all the principal and interest amounts contractually due are brought current and future payments are reasonably assured that the Company returns a loan to accrual status. Allowance for Expected Credit Losses The Company sets aside an allowance for expected credit losses by charging the provision for expected credit losses account on the Company’s consolidated statements of operations. This charge decreases the Company’s earnings. Management charges off the part of loan balances it believes it will not collect against the allowance. The Company credits subsequent recoveries, if any, to the allowance. Loan Portfolio Segments and Classes Management separates the loan portfolio into portfolio segments for purposes of evaluating the allowance for expected credit losses. A portfolio segment is defined as the level at which the Company develops and documents a systematic method for determining its allowance for expected credit losses. The Company segments the loan portfolio based on loan types and the underlying risk factors present in each loan type. Management periodically reviews and revises such risk factors, as it considers appropriate. The Company’s loan portfolio comprises two segments: ministry-related non-profit loans and commercial loans. The risk characteristics of the Company’s portfolio segments are as follows: Non-profit Commercial Loans For-profit Commercial Loans The Company has also segregated its portfolio into the following classes, which are a subsets of segments: Management has segregated the loan portfolio into the following portfolio classes: Loan Class Class Description Wholly Owned First Collateral Position, Amortizing Wholly owned loans and the retained portion of loans originated by the Company and sold for which the Company possesses a senior lien on the collateral underlying the loan. This class contains only those loans that amortize based on an agreed upon contractual principal and interest payments. Wholly Owned Other Collateral Position, Amortizing Wholly owned loans and the retained portion of loans originated by the Company and sold for which the Company possesses a lien on the underlying collateral that is superseded by another lien on the same collateral or that is secured by collateral other than real property. This class contains only those loans that amortize based on an agreed upon contractual principal and interest payments. These loans present higher credit risk than loans for which the Company possesses a senior lien due to the increased risk of loss should the loan default. Wholly Owned Unsecured, Amortizing Wholly owned loans and the retained portion of loans originated by the Company and sold for which the Company does not possess an interest in collateral securing the loan. This class contains only those loans that amortize based on an agreed upon contractual principal and interest payments. These loans present higher credit risk than loans for which the Company possesses a lien due to the increased risk of loss should the loan default. Wholly Owned Other Collateral Position, Lines of Credit Wholly owned loans and the retained portion of loans originated by the Company and sold for which the Company possesses a lien on the underlying collateral that is superseded by another lien on the same collateral or that is secured by collateral other than real property. This class contains only line of credit agreements. Wholly Owned Unsecured, Lines of Credit Wholly owned loans and the retained portion of loans originated by the Company and sold for which the Company does not possess an interest in collateral securing the loan. This class contains only line of credit agreements. Wholly Owned, Construction Wholly owned loans and the retained portion of loans originated by the Company and sold which have been made for the purpose of constructing real property to be used for the borrower’s ministry. These loans present different risks due to the nature of construction projects and the underlying collateral. Participations First Collateral Position Participated loans purchased from another financial entity for which the Company possesses a senior lien on the collateral underlying the loan. Loan participations purchased may present higher credit risk than wholly owned loans because disposition and direction of actions regarding the management and collection of the loans must be coordinated and negotiated with the other participants, whose best interests regarding the loan may not align with those of the Company. Participations Construction Loan participations purchased in loans made for the purpose of constructing commercial real property and where the collateral securing the property comprises the construction project. These loans present different risks due to the nature of construction projects and the underlying collateral. Finally, the Company segregates each class by risk rating, as loans determined to have lower credit quality present different and greater risk than those of higher credit quality. The Company’s credit quality grading system is described in detail below in the section titled “ Credit Quality Indicators Allowance for Expected Credit Loss Evaluation The Company adopted FASB Accounting Standards Update (ASU) No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments CECL In accordance with FASB Accounting Standards Update (ASU) No. 2019-04, Codification Improvements to Topic 326, Financial Instruments-Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments CECL Model The CECL methodology does not prescribe any specific model for determining expected losses. Management has determined that, due to the nature of the borrowings in its portfolio and the nature of the collateral securing a significant portion of its borrowings, it would use a “probability of default” calculation as the basis for estimating expected losses. This methodology uses information about the borrower, the loan, and the collateral securing the loan to determine a borrower’s ability to meet the contractual requirements of the loan agreement. It then applies a calculated probability that the borrower will default to the estimated amount of loss the Company would incur in a default scenario. To perform this calculation, the methodology requires management to collect and analyze certain data for the loans in its portfolio including: ● the value of collateral securing the loan, as supported by third-party appraisals or other valuations; ● adjustments to the collateral value related to geographical and economic trends, and estimated costs to sell; and ● the borrower’s ability to meet its contractual obligations as determined by financial information collected regularly from borrowers. All loans that the Company does not individually review use the probability of default calculation described above. In addition, management has determined that there are qualitative factors affecting expected credit losses for which the probability of default model cannot account. These qualitative factors represent significant issues that management considers likely to cause estimated credit losses associated with the Company’s existing portfolio to differ from the probability of default calculation. These factors are applied in varying degrees depending on a loan’s segment, class, and credit quality. Management adjusts these factors on an on-going basis, some of which include: ● changes in national, regional, and local economic and industry conditions that affect the collectability of the portfolio; ● changes in the volume and severity of past due loans, the volume of non-accrual loans, and the volume and severity of adversely classified loans; ● changes in the value of collateral, including the limitations of using commercial price indices to adjust collateral value; ● the inherent risk in borrowings with high loan-to-value figures; and ● broad trends in the Christian church industry in which the Company primarily lends. Loans that management has classified as non-performing and impaired receive a specific reserve. For such loans, an allowance is established when the carrying value of that loan is higher than the amount management expects to collect. Management uses multiple approaches to determine the amount the Company expects to collect. These include the discounted cash flow method, using the loan’s underlying collateral value reduced by expected selling costs, or using the observable market price of the impaired loan. Individually Reviewed The Company reviews its loan portfolio monthly by examining several data points. This process includes reviewing delinquency reports, any new information related to the financial condition of its borrowers, and any new appraisal or other collateral valuation. Throughout this process, the Company identifies potential impaired loans. Management generally deems a loan is impaired when current facts and circumstances indicate that it is probable a borrower will be unable to make payments according to the loan agreement. If management has not already deemed a loan impaired, it will classify the loan as non-accrual when it becomes 90 days or more past due. All loans in the loan portfolio are subject to impairment analysis. The Company monitors impaired loans on an ongoing basis as part of management’s loan review and work out process. Any loans that management has determined are non-performing and impaired are individually analyzed for potential losses. These loans include non-accrual loans, loans 90 days or more past due and still accruing, non-performing modified loans, and loans where the borrowers have defaulted on contractual terms of their loan agreement. ● Non-accrual loans are loans on which management has discontinued interest accruals. ● Modified loans are loans in which the Company has granted the borrower a concession due to financial distress. Concessions are usually a reduction of the interest rate or a change in the original repayment terms. ● Loans that have defaulted on other contractual terms could include loans where the borrower has failed to provide required financial information, has violated a covenant, or has otherwise failed to comply with the terms of the loan agreement. Management considers several factors when determining impairment status. These factors include the loan’s payment status, the value of any secured collateral, and the probability of collecting scheduled payments when due. Management generally does not classify loans that experience minor payment delays or shortfalls as impaired. Management determines the significance of payment delays or shortfalls on a case-by-case basis, taking into consideration all the circumstances surrounding the loan and the borrower. These circumstances include the length and reasons for the delay, the borrower’s payment history, and the amount of the shortfall in relation to the principal and interest owed. Management measures impairment on a loan-by-loan basis using one of three methods: ● the present value of expected future cash flows discounted at the loan’s effective interest rate; ● the obtainable market price; or ● the fair value of the collateral if the loan is collateral-dependent. A loan modification is a loan for which the Company, for reasons related to a borrower’s financial difficulties, grants a concession to a borrower that the Company would not otherwise consider. A modification of a loan usually involves an interest rate reduction, extension of the maturity date, payment reduction, or reduction of accrued interest owed on the loan on a contingent or absolute basis. Management considers loans that it renews at below-market terms to be loan modifications if the below-market terms represent a concession due to the borrower’s troubled financial condition. The Company classifies loan modifications as impaired loans. For the loans that are not considered to be collateral-dependent, management measures loan modifications at the present value of estimated future cash flows using the loan’s effective rate prior to the loan’s initial modification. The Company reports the change in the present value of cash flows related to the passage of time as interest income. If management considers the loan to be collateral-dependent, impairment is measured based on the fair value of the collateral. In accordance with industry standards, the Company classifies a loan as impaired if management has modified it as part of a loan modification. However, loan modifications, upon meeting certain performance conditions, are eligible to receive non-classified loan ratings (pass or watch) and to be moved out of non-accrual status. These loans continue to be classified as impaired loans but not necessarily as non-accrual or collateral-dependent loans. Modified loans can be included in the collectively reviewed pool of loans if they return to performing status. Loan Charge-offs Management charges off loans or portions thereof when it determines the loans or portions of the loans are uncollectible. The Company evaluates collectability periodically on all loans classified as “Loans of Lesser Quality.” Key factors management uses in assessing a loan’s collectability are the financial condition of the borrower, the value of any secured collateral, and the terms of any workout agreement between the Company and the borrower. In workout situations, the Company charges off the amount deemed uncollectible due to the terms of the workout, the inability of the borrower to make agreed upon payments, and the value of the collateral securing the loan. Credit Quality Indicators The Company has established a loan grading system to assist its management in analyzing and monitoring the loan portfolio. The Company classifies loans it considers lesser quality (“ classified loans Pass: The borrower has sufficient cash to fund debt services. The borrower may be able to obtain similar financing from other lenders with comparable terms. The risk of default is considered low. Watch: These loans exhibit potential or developing weaknesses that deserve extra attention from credit management personnel. If the developing weakness is not corrected or mitigated, there may be deterioration in the ability of the borrower to repay the debt in the future. Management must report loans graded Watch to executive management and the Board of Managers (“ Board Special mention: These credit facilities exhibit potential or actual weaknesses that present a higher potential for loss under adverse circumstances and deserve management’s close attention. If uncorrected, these weaknesses may result in deterioration of the repayment prospects for the loan at some future date. Substandard: Management considers loans and other credit extensions bearing this grade to be inadequately protected by the current net worth and debt service capacity of the borrower or of any pledged collateral. These obligations, even if apparently protected by collateral value, have well-defined weaknesses related to adverse financial, managerial, economic, ministry, or environmental conditions which have clearly jeopardized repayment of principal and interest as originally intended. Furthermore, there is the possibility that some future loss will be sustained if such weaknesses are not corrected. Doubtful: This classification consists of loans that display the properties of substandard loans with the added characteristic that the severity of the weaknesses makes collection or liquidation in full highly questionable or improbable based upon currently existing facts, conditions, and values. The probability of some loss is very high, but because of certain important and reasonably specific factors, the amount of loss cannot be exactly determined. Such pending factors could include a merger or liquidation, additional capital injection, refinancing plans, or perfection of liens on additional collateral. Loss: Loans in this classification are considered uncollectible and cannot be justified as a viable asset. This classification does not mean the loan has absolutely no recovery value, but that it is neither practical nor desirable to defer writing off this loan even though partial recovery may be obtained in the future. Revenue Recognition The Company recognizes two primary types of revenue: interest income and non-interest income. Interest Income The Company’s principal source of revenue is interest income from loans, which is not within the scope of ASU 2014-09, Revenue from Contracts with Customers and all subsequent amendments to the ASU (collectively, "ASC 606"). Refer to the discussion in “Loans Receivable” above to understand the Company’s recognition of interest income. Non-interest Income Non-interest income includes revenue from various types of transactions and services provided to customers. Contracts with customers can include multiple services, which are accounted for as separate “performance obligations” if they are determined to be distinct. Our performance obligations to our customers are generally satisfied when we transfer the promised good or service to our customer, either at a point in time or over time. Revenue from a performance obligation transferred at a point in time is recognized at the time that the customer obtains control over the promised good or service. Revenue from our performance obligations satisfied over time are recognized in a manner that depicts our performance in transferring control of the good or service, which is generally measured based on time elapsed, as our customers simultaneously receive and consume the benefit of our services as they are provided. Payment for the majority of our services is variable consideration, as the amount of revenues we expect to receive is subject to factors outside of our control, including market conditions. Variable consideration is only included in revenue when amounts are not subject to significant reversal, which is generally when uncertainty around the amount of revenue to be received is resolved. Wealth advisory fees Generally, management recognizes wealth advisory fees over time as the Company renders services to its clients. The Company receives these fees either based on a percentage of the market value of the assets under management, or as a fixed fee based on the services the Company provides to the client. The Company’s delivery of these services represents its related performance obligations. The Company typically collects the wealth advisory fees at the beginning of each quarter from the client’s account. Management recognizes these fees ratably over the related billing period as the Company fulfills its performance obligation. In addition, management recognizes any commissions or referral fees paid related to this revenue ratably over the related billing period as the Company fulfills its performance obligation. Investment brokerage fees Investment brokerage fees arise from the selling, distribution, and trade execution services. The Company’s execution of these services fulfills its related performance obligations. The Company also offers sales and distribution services and earns commissions through the sale of annuity and mutual fund products. The Company acts as an agent in these transactions and recognizes revenue at a point in time when the customer executes a contract with a product carrier. The Company may also receive trailing commissions and 12b-1 fees related to mutual fund and annuity products. Management recognizes this revenue in the period when it is earned, estimating the revenue, if necessary, based on the balance of the investment and the commission rate on the product. The Company earns and recognizes trade execution commissions on the trade date, which is when the Company fulfills its performance obligation. Payment for the trade execution is due on the settlement date. Lending Fees Lending fees represent charges earned for services we provide as part of the lending process, such as late charges, servicing fees, and documentation fees. The Company recognizes late charges as earned when they are paid. The Company recognizes revenue on other lending fees in the period in which the Company has performed the service. Gains on sales of loans receivable From time to time, the Company sells participation interests in loans receivable that it services. Upon completion of the loan sale, the Company recognizes a gain based on certain factors including the maturity date of the loan, the percentage of the loan sold and retained, and the servicing rate charged to the participant on the sold portion. Charitable contributions Charitable contributions include amounts that were donated by a not-for-profit charitable ministry to the Company’s not-for-profit subsidiary, MPC. This revenue comprises donations analyzed by management and determined to be unconditional, non-exchange transactions. Contributions are measured at their fair value at the date of contribution. All contributions are considered to be available for unrestricted use unless specifically restricted by the donor. Amounts received that are designated for future periods or restricted by the donor for specific purposes are reported as carrying donor restrictions. The $1.7 million in charitable contributions recognized during 2023, were permanently restricted by the donor as part of a designated fund agreement that allows for limited annual distributions. These funds are included in the restricted net assets of MPC and are presented on the balance sheet as part of retained earnings. Gains/losses on sales of foreclosed assets The Company records a gain or loss from the sale of foreclosed assets when control of the property transfers to the buyer, which generally occurs at the time of an executed deed. When the Company finances the sale of |
Pledged Cash and Restricted Cas
Pledged Cash and Restricted Cash | 3 Months Ended |
Mar. 31, 2024 | |
Cash and Cash Equivalents [Abstract] | |
Pledged Cash and Restricted Cash | Note 2: Pledged Cash and Restricted Cash Under the terms of its debt agreements, the Company can pledge cash as collateral for its borrowings. On March 31, 2024 and December 31, 2023, the Company had cash of $7 thousand pledged as collateral for its secured borrowings. See “Note 3: Related Party Transactions” The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the statement of financial position to the amounts reported in the statements of cash flows (dollars in thousands): March 31, December 31, 2024 2023 2023 Cash and cash equivalents $ 11,193 $ 17,057 $ 10,854 Restricted cash 1,760 58 1,757 Total cash, cash equivalents, and restricted cash shown in the statement of cash flows $ 12,953 $ 17,115 $ 12,611 Restricted cash includes $1.7 million donated to MPC as permanently restricted funds under a designated fund agreement. The agreement allows for limited annual distributions of the funds. Other amounts included in restricted cash represent those required to be set aside in the CRD account with Financial Industry Regulation Authority (“ FINRA |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2024 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 3: Related Party Transactions Transactions with Equity Owners Transactions with AdelFi Credit Union, a California state chartered credit union (“AdelFi”) The tables below summarize transactions the Company conducts with AdelFi, (formerly Evangelical Christian Credit Union), the Company’s largest equity owner. Related party balances pertaining to the assets of the Company (dollars in thousands): March 31, December 31, 2024 2023 Total funds held on deposit at AdelFi $ 3,135 $ 3,457 Loan participations purchased from and serviced by AdelFi 1,284 1,298 Related party transactions of the Company (dollars in thousands): Three months ended March 31, 2024 2023 Interest earned on funds held with AdelFi $ 39 $ — Interest income earned on loans purchased from AdelFi 21 1 Fees paid to AdelFi from MP Securities Networking Agreement 3 2 Loan participation interests purchased: The tables above show the number of loans purchased from Adelfi and the balance of loans serviced by Adelfi. For these loans, management negotiated the pass-through interest rates on a loan-by-loan basis and believes these negotiated terms were equivalent to those that would prevail in an arm’s length transaction. MP Securities Networking Agreement with AdelFi: MP Securities has entered into a Networking Agreement with AdelFi pursuant to which MP Securities agreed to offer investment and insurance products and services to AdelFi’s members that: (1) AdelFi or its Board of Directors has approved; (2) comply with applicable investor suitability standards required by federal and state securities laws and regulations; (3) are offered in accordance with National Credit Union Administration (“ NCUA ”) rules and regulations; and (4) comply with its membership agreement with FINRA. The agreement provides that MP Securities will pay AdelFi a percentage of total revenue received by MP Securities from transactions conducted for or on behalf of AdelFi members. Either AdelFi or MP Securities may terminate the Networking Agreement without cause upon thirty days prior written notice. Transactions with America’s Christian Credit Union, a California state chartered credit union (“ACCU”) The Company has several related party agreements with ACCU, one of the Company’s equity owners. The following describes the nature and dollar amounts of the material related party transactions with ACCU. Related party balances pertaining to the assets of the Company (dollars in thousands): March 31, December 31, 2024 2023 Total funds held on deposit at ACCU $ 82 $ 164 Dollar amount of outstanding loan participations sold to ACCU and serviced by the Company 935 941 Amount owed on ACCU secured borrowings 7 7 Amount owed on ACCU line of credit 3,000 4,500 Loans pledged on ACCU line of credit 7,121 7,167 Related party transactions of the Company (dollars in thousands): Three months ended March 31, 2024 2023 Interest earned on funds held with ACCU $ — $ 1 Dollar amount of net draws (payments) made on ACCU line of credit (1,500) — Interest expense on ACCU borrowings 70 20 Income from broker services provided to ACCU by MPS 8 9 Fees paid based on MP Securities Networking Agreement with ACCU 24 36 Loan participation interests sold: From time to time, the Company sells loan participation interests in loans it originates and services to ACCU. The Company negotiates pass-through interest rates on loan participation interests sold to ACCU on a loan-by-loan basis. Management believes these terms are equivalent to those that prevail in arm’s length transactions. Effective August 9, 2021, the Company entered into a Master Loan Participation Purchase and Sale Agreement (“ the Master LP Agreement Sales made under the Master LP Agreement are done on a recourse basis, requiring the Company to repurchase the participation interest in the event of default by the borrower. Under a separate Deposit Control Agreement reached in conjunction with the Master LP Agreement, the Company deposited cash on a one-to-one basis as collateral to secure the participation interest sold to ACCU. This cash is considered restricted cash. The Company retains the ability to sell loan participation interests to ACCU outside of the Master LP Agreement. As of March 31, 2024 and December 31, 2023, $7 thousand in participation interests had been sold and were outstanding under this agreement. These have been classified as secured borrowings on our balance sheet. The Company has deposited equal amounts of cash in an account at ACCU as collateral for these borrowings. These funds are considered restricted cash. MP Securities Networking Agreement with ACCU: MP Securities has entered into a Networking Agreement with ACCU pursuant to which MP Securities has agreed to offer investment and insurance products and services to ACCU’s members that: (1) ACCU or its Board of Directors has approved; (2) comply with applicable investor suitability standards required by federal and state securities laws and regulations; (3) are offered in accordance with NCUA rules and regulations; and (4) comply with its membership agreement with FINRA. The agreement provides that MP Securities will pay ACCU a percentage of total revenue received by MP Securities from transactions conducted for or on behalf of ACCU members. Either ACCU or MP Securities may terminate the Networking Agreement without cause upon thirty days prior written notice. Line of Credit: On September 23, 2021, the Company entered into a Loan and Security Agreement with ACCU. The ACCU line of credit (“ ACCU LOC “Note 10: Credit Facilities and Other Debt” Transactions with Kane County Teachers Credit Union (“KCT”) Our Board Chairperson, R. Michael Lee, serves as the Chief Executive Officer and President of KCT, an Illinois state chartered financial institution. Related party balances pertaining to the assets of the Company (dollars in thousands): March 31, December 31, 2024 2023 Total funds held on deposit at KCT $ 3,251 $ 1,308 Amount owed on KCT line of credit 4,500 — Loans pledged on KCT lines of credit 11,932 10,962 Certificates of deposit pledged on KCT Warehouse LOC 1,250 1,250 Outstanding loan participations sold to KCT and serviced by the Company 3,365 3,455 Related party transactions of the Company (dollars in thousands): Three months ended March 31, 2024 2023 Interest earned on funds held with KCT $ 8 $ 10 Dollar amount of draws on KCT line of credit 4,500 — Interest expense on KCT line of credit 13 — Fees paid based on MP Securities Networking Agreement with KCT 5 8 Funds on deposit with KCT: On March 15, 2024, the Company purchased a $1.3 million certificate of deposit Lines of credit: On June 6, 2022, the Company terminated the existing $7.0 million Loan and Security Agreement with KCT. It replaced this agreement with two short-term demand credit facilities, a $5.0 million warehouse line of credit (“ KCT Warehouse LOC KCT Operating LOC”). “Note 10: Credit Facilities and Other Debt” MP Securities Networking Agreement MP Securities, the Company’s wholly owned subsidiary, has entered into a Networking Agreement with KCT pursuant to which MP Securities agreed to offer investment and insurance products and services to KCT’s members that: (1) KCT or its Board of Directors has approved; (2) comply with applicable investor suitability standards required by federal and state securities laws and regulations; (3) are offered in accordance with NCUA rules and regulations; and (4) comply with its membership agreement with FINRA. The agreement provides that MP Securities pay KCT a percentage of total revenue received by MP Securities from transactions conducted for or on behalf of KCT members. Either KCT or MP Securities may terminate the Networking Agreement without cause upon thirty days prior written notice. Loan Participation Interests Sold Occasionally the Company sells loan participation interests to KCT in the normal course of business. The Company retains the right to service these participation loans sold to KCT, and charges KCT a customary fee for servicing the loan. As of March 31, 2024 and December 31, 2023, respectively, the Company serviced $3.4 million and $3.5 million in loan participations that it has sold to KCT. Transactions with Other Equity Owners From time to time the Company will engage in transactions with other owners or related parties. Related party balances pertaining to the assets of the Company (dollars in thousands): March 31, December 31, 2024 2023 Outstanding loan participations sold to NFCU and serviced by the Company $ 4,712 $ 4,745 Outstanding notes payable to officers and managers 2,781 2,871 Loan Participation Interests The Company has entered into a Loan Participation Agreement with Navy Federal Credit Union (“ NFCU From time to time, the Company may purchase a loan participation interest from a related party. The Company and its related party will negotiate in good faith the terms and conditions of such a purchase and in accordance with the Company’s related party procedures and governance practices. Each party must approve such a purchase after full disclosure of the related party transaction and must include terms and conditions that would normally be included in arm’s length transactions conducted by independent parties. Debt Certificates Sold From time to time, the Company’s Board and members of its executive management team have purchased debt certificates from the Company or have purchased investment products through MP Securities. Debt certificates payable owned by related parties totaled $2.8 million and $2.9 million as of March 31, 2024 and December 31, 2023, respectively. Transactions with Subsidiaries The Company has entered into several agreements with its subsidiary, MP Securities. The Company eliminates the income and expense related to these agreements in the consolidated financial statements. MP Securities serves as the managing broker for the Company’s public and private placement note offerings. MP Securities receives compensation related to these broker dealer services ranging from 0.25% to 5.50% over the life of a note. The amount of the compensation depends on the length of the note and the terms of the offering under which MP Securities sold the note. The Company has also entered into an Administrative Services Agreement with MP Securities. The Administrative Services Agreement provides services such as the use of office space, use of equipment, including computers and phones, and payroll and personnel services. The agreement stipulates that MP Securities will provide ministerial, compliance, marketing, operational, and investor relations-related services in relation to the Company’s debt certificates program. As stated above, the Company eliminates all intercompany transactions related to this agreement in its consolidated financial statements. Related Party Transaction Policy The Board has adopted a Related Party Transaction Policy to assist in evaluating transactions the Company may enter into with a related party. Under this policy, a majority of the members of the Company’s Board and majority of its independent Board members must approve a material transaction that it enters into with a related party. As a result, all transactions that the Company undertakes with an affiliate, or a related party are entered into on terms believed by management to be no less favorable than are available from unaffiliated third parties. In addition, a majority of the Company’s independent Board members must approve these transactions. |
Loans Receivable and Allowance
Loans Receivable and Allowance for Expected Credit Losses | 3 Months Ended |
Mar. 31, 2024 | |
Receivables [Abstract] | |
Loans Receivable and Allowance for Expected Credit Losses | Note 4: Loans Receivable and Allowance for Expected Credit Losses The Company’s loan portfolio comprises two segments, Non-profit commercial loans to Christian churches and ministries, and for-profit commercial loans. See “Note 1 – Loan Portfolio Segments and Classes” to Part I “Financial Information” ● wholly owned amortizing loans for which the Company possesses the first collateral position; ● wholly owned amortizing loans for which the Company possesses security other than a first collateral position on real property; ● wholly owned amortizing loans that are unsecured; ● wholly owned lines of credit for which the Company possesses security other than a first collateral position on real property; ● wholly owned lines of credit that are unsecured; ● wholly owned construction loans ● participated amortizing loans purchased for which the Company possesses the first collateral position; and ● participated construction loans purchased. Prior to January 1, 2023, the Company’s loan portfolio comprised one segment – commercial loans – and four classes. Prior period data has been reclassified in the following tables to conform to current period presentation. The Company primarily originates or purchases participations in loans that are made to Christian non-profit organizations and churches. The purpose of these loans is to purchase, construct, or improve facilities. Occasionally the Company purchases for-profit commercial loans to meet the Company’s revenue and yield goals, as well as to diversify the Company’s loan portfolio. Maturities on the loan portfolio extend through 2038. The loan portfolio had weighted average interest rate of 6.68% and 6.42% as of March 31, 2024 and December 31, 2023, respectively. The table below is a summary of the Company’s mortgage loans owned (dollars in thousands): March 31, December 31, 2024 2023 Non-profit commercial loans: Real estate secured $ 88,799 $ 87,524 Unsecured 68 74 Total non-profit commercial loans: 88,867 87,598 For-profit commercial loans: Real estate secured 12,787 12,783 Total loans 101,654 100,381 Deferred loan fees, net (139) (139) Loan discount (165) (168) Allowance for expected credit losses (1,449) (1,501) Loans, net $ 99,901 $ 98,573 Allowance for expected credit losses Management believes it has properly calculated the allowance for expected credit losses using CECL methodology as of March 31, 2024 and December 31, 2023. The following table shows the changes in the allowance for expected credit losses for the three months ended March 31, 2024 and the year ended December 31, 2023 (dollars in thousands): Three months ended March 31, 2024 Segment: Non-profit Commercial For-profit Commercial Total Balance, beginning of period $ 1,471 $ 30 $ 1,501 Provision (credit) for expected credit loss (53) 1 (52) Charge-offs — — — Recoveries — — — Balance, end of period $ 1,418 $ 31 $ 1,449 Year ended December 31, 2023 Segment: Non-profit Commercial For-profit Commercial Total Balance, beginning of period $ 1,530 $ 21 $ 1,551 Adjustment related to implementation of CECL model 129 (16) 113 Provision (credit) for expected credit loss (167) 25 (142) Charge-offs (21) — (21) Recoveries — — — Balance, end of period $ 1,471 $ 30 $ 1,501 In the course of its lending operations, the Company has made loans that include commitments to fund additional amounts over the remaining term of the loan. These include construction loans and lines of credit, both revolving and non-revolving. The Company has established an allowance for losses on these unfunded commitments. See "Note 12: Commitments and Contingencies" The table below presents loans by portfolio segment and the related allowance for expected credit losses. In addition, the table segregates loans and the allowance for expected credit losses by impairment methodology (dollars in thousands). Loans and Allowance for Expected Credit Losses (by segment) As of March 31, 2024 December 31, 2023 Non-profit Commercial Loans: Individually evaluated for impairment $ 16,767 $ 16,792 Collectively evaluated for impairment 72,100 70,806 Total Non-profit Commercial Loans 88,867 87,598 For-profit Commercial Loans: Individually evaluated for impairment — — Collectively evaluated for impairment 12,787 12,783 Total For-profit Commercial Loans 12,787 12,783 Balance $ 101,654 $ 100,381 Allowance for expected credit losses: Non-profit Commercial Loans: Individually evaluated for impairment $ 675 $ 669 Collectively evaluated for impairment 743 802 Total Non-profit Commercial Loan Allowance 1,418 1,471 For-profit Commercial Loans: Individually evaluated for impairment — — Collectively evaluated for impairment 31 30 Total For-profit Commercial Loan Allowance 31 30 Balance $ 1,449 $ 1,501 The Company has established a loan grading system to assist management in their analysis and supervision of the loan portfolio. The following tables summarize the credit quality indicators by loan class (dollars in thousands): Credit Quality Indicators (by class) As of March 31, 2024 Pass Watch Special Mention Substandard Doubtful Loss Total Non-profit Commercial Loans Wholly Owned First Amortizing $ 46,589 $ 22,675 $ 5,408 $ 9,881 $ — $ — $ 84,553 Wholly Owned Other Amortizing 1,393 — — 1,478 — — 2,871 Wholly Owned Unsecured Amortizing 24 28 — — — — 52 Wholly Owned Unsecured LOC 40 — — — — — 40 Participation First 1,284 — — — — — 1,284 Total Non-profit Commercial Loans 49,397 22,703 5,408 11,359 — — 88,867 For-profit Commercial Loans — Wholly Owned First Amortizing 6,771 2,800 — — — — 9,571 Participation First 1,641 132 — — — — 1,773 Participation Construction 1,443 — — — — — 1,443 Total For-profit Commercial Loans 9,855 2,932 — — — — 12,787 Total Loans $ 59,252 $ 25,635 $ 5,408 $ 11,359 $ — $ — $ 101,654 Credit Quality Indicators (by class) As of December 31, 2023 Pass Watch Special Mention Substandard Doubtful Loss Total Non-profit Commercial Loans Wholly Owned First Amortizing $ 35,106 $ 32,891 $ 5,408 $ 9,882 $ — $ — $ 83,287 Wholly Owned Other Amortizing 1,405 — — 1,502 — — 2,907 Wholly Owned Unsecured Amortizing 25 28 — — — — 53 Wholly Owned Unsecured LOC 46 — — — — — 46 Wholly Owned Construction 7 — — — — — 7 Participation First 1,298 — — — — — 1,298 Total Non-profit Commercial Loans 37,887 32,919 5,408 11,384 — — 87,598 For-profit Commercial Loans Participation First 1,776 — — — — — 1,776 Participation Construction 1,433 — — — — — 1,433 Total For-profit Commercial Loans 12,783 — — — — — 12,783 Total Loans $ 50,670 $ 32,919 $ 5,408 $ 11,384 $ — $ — $ 100,381 The following table sets forth certain information with respect to the Company’s loan portfolio delinquencies by loan class and amount (dollars in thousands): Age Analysis of Past Due Loans (by class) As of March 31, 2024 30-59 Days Past Due 60-89 Days Past Due Greater Than 90 Days Total Past Due Current Total Loans Recorded Investment 90 Days or More and Still Accruing Non-profit Commercial Loans Wholly Owned First Amortizing $ 1,002 $ 6,749 $ 1,831 $ 9,582 $ 74,971 $ 84,553 $ — Wholly Owned Other Amortizing — — — — 2,871 2,871 — Wholly Owned Unsecured Amortizing — — — — 52 52 — Wholly Owned Unsecured LOC — — — — 40 40 — Participation First — — — — 1,284 1,284 — Total Non-profit Commercial Loans 1,002 6,749 1,831 9,582 79,285 88,867 — For-profit Commercial Loans Wholly Owned First Amortizing — — — — 9,571 9,571 — Participation First 344 — — 344 1,429 1,773 — Participation Construction — — — — 1,443 1,443 — Total For-profit Commercial Loans 344 — — 344 12,443 12,787 — Total Loans $ 1,346 $ 6,749 $ 1,831 $ 9,926 $ 91,728 $ 101,654 $ — Age Analysis of Past Due Loans (by class) As of December 31, 2023 30-59 Days Past Due 60-89 Days Past Due Greater Than 90 Days Total Past Due Current Total Loans Recorded Investment 90 Days or More and Still Accruing Non-profit Commercial Loans Wholly Owned First Amortizing $ 7,020 $ 143 $ 875 $ 8,038 $ 75,249 $ 83,287 $ — Wholly Owned Other Amortizing — — — — 2,907 2,907 — Wholly Owned Unsecured Amortizing — — — — 53 53 — Wholly Owned Unsecured LOC — — — — 46 46 — Wholly Owned Construction — — — — 7 7 — Participation First — — — — 1,298 1,298 — Total Non-profit Commercial Loans 7,020 143 875 8,038 79,560 87,598 — For-profit Commercial Loans Participation First — — — — 1,776 1,776 — Participation Construction — — — — 1,433 1,433 — Total For-profit Commercial Loans — — — — 12,783 12,783 — Total Loans $ 7,020 $ 143 $ 875 $ 8,038 $ 92,343 $ 100,381 $ — Impaired Loans The following tables are summaries of impaired loans by loan class. The unpaid principal balance reflects the contractual principal outstanding on the loan. Included in the balance of impaired loans are loan modifications that performed according to contractual terms and that the Company has upgraded to pass or watch since the date of the modification. The recorded investment reflects the unpaid principal balance less any interest payments that management has recorded against principal and less discounts taken. No loans in the Company’s commercial loan segment were classified as impaired or non-accrual at December 31, 2023, nor were there any loan modifications during the three months ended March 31, 2024. The tables below represent the breakdown by class of the non-profit loan portfolio segment only (dollars in thousands): As of As of March 31, December 31, Impaired Non-profit commercial Loans (by class) 2024 2023 Wholly Owned First Amortizing Recorded investment with specific allowance $ 8,241 $ 8,238 Recorded with no specific allowance 13,838 15,166 Total recorded investment $ 22,079 $ 23,404 Unpaid principal balance $ 22,539 $ 23,870 Wholly Owned Other Amortizing Recorded investment with specific allowance $ 1,478 $ 1,502 Recorded with no specific allowance — — Total recorded investment $ 1,478 $ 1,502 Unpaid principal balance $ 1,685 $ 1,685 Total Impaired Loans Recorded investment with specific allowance $ 9,719 $ 9,740 Recorded with no specific allowance 13,838 15,166 Total recorded investment $ 23,557 $ 24,906 Unpaid principal balance $ 24,224 $ 25,555 For the three months ended March 31, March 31, Impaired Non-profit Commercial Loans (by class) 2024 2023 Wholly Owned First Amortizing Average recorded investment $ 22,845 $ 25,132 Interest income recognized 317 303 Wholly Owned Other Amortizing Average recorded investment 1,490 1,579 Interest income recognized — — Total Impaired Loans Average recorded investment $ 24,335 $ 26,711 Interest income recognized 317 303 A summary of nonaccrual loans by loan class is as follows (dollars in thousands): Loans on Nonaccrual Status (by class) as of March 31, 2024 December 31, 2023 Non-profit Commercial Loans: Wholly Owned First Amortizing $ 9,881 $ 9,882 Wholly Owned Other Amortizing 1,478 1,502 Total $ 11,359 $ 11,384 The Company did not modify any loans during the three-month periods ended March 31, 2024 and March 31, 2023. The Company has one modified loan that is past maturity as of March 31, 2024. This loan has been completely written off as of March 31, 2024. When loans are modified, the Company monitors borrower performance according to the terms of the modifications to determine whether there are any early indicators for future default. Management regularly evaluates loan modifications for potential further impairment and will adjust the risk ratings and specific reserves associated with loan modifications as deemed necessary. As of March 31, 2024, the Company has made no commitments to advance additional funds in connection with loan modifications. |
Investments
Investments | 3 Months Ended |
Mar. 31, 2024 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investments | Note 5: Investments Joint Venture In December 2015, the Company finalized an agreement with Intertex Property Management, Inc., a California corporation, to enter into a joint venture to form Tesoro Hills, LLC (the “ Valencia Hills Project As of March 31, 2024 and December 31, 2023, the value of the Company’s investment in the joint venture was $870 thousand and $871 thousand, respectively. Management’s impairment analysis of the investment as of March 31, 2024, has determined that the investment is not impaired. Certificates of Deposit The Company held an investment in certificates of deposit with an original maturity greater than three months on March 31, 2024 and December 31, 2023. Details of certificates with original maturities of greater than three months owned by the Company as of March 31, 2024, are as follows (dollars in thousands): As of March 31, 2024 Certificate Open Date Certificate Amount Interest Rate Maturity Date CD 1 3/15/2024 $ 1,251 2.25% 3/15/2025 The certificate identified above was purchased from KCT and is pledged as a compensating balance under the terms of the KCT Warehouse LOC. See “Note 10: Credit Facilities and Other Debt” Other Investments In June 2022, the Company entered into two indexed annuity insurance contracts whereby an insurance company guarantees a fixed rate of return in exchange for holding a deposit from the Company for the contracted period of ten years. Additional information related to these investments is as follows (dollars in thousands): Income for the three months ended Investment Type Maturity Date Original Cost Net Carrying Amount March 31, 2024 March 31, 2023 Fixed annuity June 2032 $ 1,000 $ 1,053 $ 1 $ 1 |
Revenue Recognition
Revenue Recognition | 3 Months Ended |
Mar. 31, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Note 6: Revenue Recognition The Company recognizes two primary types of revenue: interest income and non-interest income. The following tables reflect the Company’s non-interest income disaggregated by financial statement line item. Items outside of the scope of ASC 606 are noted as such (dollars in thousands): Three months ended March 31, 2024 2023 Non-interest income, in scope of ASC 606 Broker-dealer fees and commissions $ 175 $ 215 Gains on loan sales — 7 Other investment income 1 1 Other non-interest income — 5 Non-interest income, out of scope, ASC 606 Lending fees 35 50 Charitable contributions, with donor restrictions — 400 Total non-interest income $ 211 $ 678 In accordance with our accounting policies as governed by ASC 606, Revenue from Contracts with Customers, the following table separates revenue from contracts with customers into categories that are based on the nature, amount, timing, and uncertainty of revenue and cash flows associated with each product and distribution channel. Non-interest revenue earned by the Company’s broker-dealer subsidiary, MP Securities, comprises securities commissions, sale of investment company shares, insurance product revenue, and advisory fee income. Securities commission revenue represents the sale of over-the-counter stock, unit investment trusts, and variable annuities. The Company recognizes the revenue earned from the sale of these products upon satisfaction of performance obligations, which occur on the trade date, and is considered transactional revenue. The Company also earns revenue from the management of invested assets, which management recognizes monthly, as earned, based on the average asset value. We refer to this revenue as assets under management revenue (“ AUM For the three months ended (dollars in thousands) March 31, 2024 March 31, 2023 Broker-dealer revenue Securities commissions Transactional $ 39 $ 15 AUM 15 12 54 27 Sale of investment company products Transactional 2 3 AUM 22 17 24 20 Other insurance product revenue Transactional — 78 AUM 11 12 11 90 Advisory fee income Transactional — — AUM 86 78 86 78 Total broker-dealer revenue Transactional 41 96 AUM 134 119 $ 175 $ 215 |
Loan Sales
Loan Sales | 3 Months Ended |
Mar. 31, 2024 | |
Transfers and Servicing of Financial Assets [Abstract] | |
Loan Sales | Note 7: Loan Sales A summary of loan participation sales and servicing assets are as follows (dollars in thousands): As of and for the Three months ended Year ended March 31, December 31, 2024 2023 2023 Loan participation interests sold by the Company $ — $ 7 $ 502 Total participation interests sold and serviced by the Company 31,200 34,006 31,466 Servicing income 32 37 134 Servicing Assets Balance, beginning of period $ 98 $ 123 $ 123 Additions: Servicing obligations from sale of loan participations — 9 18 Subtractions: Amortization (10) (10) (43) Balance, end of period $ 88 $ 122 $ 98 ACCU Loan Participation Agreement (Secured Borrowings) As detailed in “Note 3: Related Party Transactions,” effective August 9, 2021, the Company entered into a Master Loan Participation Purchase and Sale Agreement with ACCU. Under the Master LP Agreement, the Company makes sales on a recourse basis, requiring the Company to repurchase the participation interest in the event of default by the borrower. During the three months ended March 31, 2023, the Company sold two loan participations for $7 thousand to ACCU under the provisions of the Master LP Agreement. Due to the recourse provisions of the agreement, these participation sales are classified as secured borrowings and are presented as part of other secured borrowings on the Company’s consolidated balance sheets. The Company did not sell any loan participations to ACCU under the provisions of the Master LP Agreement during the three months ended March 31, 2024. |
Foreclosed Assets
Foreclosed Assets | 3 Months Ended |
Mar. 31, 2024 | |
Repossessed Assets [Abstract] | |
Foreclosed Assets | Note 8: Foreclosed Assets The Company’s investment in foreclosed assets consisted of one property that management valued at $301 thousand at March 31, 2024 and December 31, 2023. There was no allowance for losses on foreclosed assets at March 31, 2024 and December 31, 2023. The Company did not record any provision for losses on foreclosed assets during the three months ended March 31, 2024 and 2023. Expenses applicable to foreclosed assets include the following (dollars in thousands): For the three months ended March 31, Foreclosed Asset Expenses 2024 2023 Provision for losses $ — $ — Operating expenses 10 4 Total foreclosed asset expenses $ 10 $ 4 |
Premises and Equipment
Premises and Equipment | 3 Months Ended |
Mar. 31, 2024 | |
Property, Plant and Equipment [Abstract] | |
Premises and Equipment | Note 9: Premises and Equipment The table below summarizes our premises and equipment (dollars in thousands): As of March 31, December 31, 2024 2023 Furniture and office equipment $ 449 $ 440 Computer system 226 221 Leasehold improvements 43 43 Total premises and equipment 718 704 Less accumulated depreciation and amortization (623) (648) Premises and equipment, net $ 95 $ 56 For the three months ended March 31, March 31, 2024 2023 Depreciation and amortization expense $ 17 $ 11 |
Credit Facilities and Other Deb
Credit Facilities and Other Debt | 3 Months Ended |
Mar. 31, 2024 | |
Debt Disclosure [Abstract] | |
Credit Facilities and Other Debt | Note 10: Credit Facilities and Other Debt Details of the Company’s debt facilities as of March 31, 2024, are as follows (dollars in thousands): Nature of Borrowing Interest Rate Interest Rate Type Amount Outstanding Amount Available to Borrow Maturity Date Amount of Loan Collateral Pledged Other Assets Pledged* KCT Warehouse LOC 9.00% Variable $ — $ 5,000 6/6/2024 $ 6,940 $ 1,250 KCT Operating LOC 9.00% Variable 4,500 500 6/6/2024 4,993 — ACCU LOC 9.25% Variable 3,000 2,000 9/23/2024 7,121 — ACCU Secured Various Fixed 7 — Various — 7 *Represents cash or certificates of deposit KCT Lines of Credit On September 30, 2020, Ministry Partners Investment Company, LLC, entered into a Loan and Security Agreement with KCT Credit Union, an Illinois state chartered financial institution. On June 6, 2022, the Company and KCT mutually agreed to terminate this facility and entered into two new facilities. The first facility, the KCT Warehouse LOC, is a $5.0 million short-term demand credit facility with a one-year maturity date ending on June 6, 2024. The KCT Warehouse LOC will automatically renew for another one-year term unless either party furnishes written notice at least 30 days prior to the termination date that it does not intend to renew the agreement. The Company has secured the KCT Warehouse LOC with certain of its mortgage loan investments. The Company may draw funds on the KCT Warehouse LOC at any time until the line is fully drawn. Repayment of each advance is due 120 days after the advance is made or earlier if a collateral loan becomes more than 60 days delinquent, and the Company fails to cure such deficiency. The interest rate on the KCT Warehouse LOC is equal to the prime rate at the time of the draw plus 0.50%. At March 31, 2024, the interest rate on the KCT Warehouse LOC was 9.00%. To secure its obligations under the KCT Warehouse LOC, the Company has agreed to grant a priority first lien and security interest in certain of its mortgage loan investments and maintain a minimum collateralization ratio measured by taking outstanding balance of mortgage notes pledged under the facility as compared to the total amount of principal owed on the KCT Warehouse LOC. The minimum ratio must equal at least 120%. The KCT Warehouse LOC also requires the Company to maintain a deposit of 25% of the total line limit to borrow on the facility. In September 2022, the Company purchased a $1.25 million certificate of deposit from KCT that satisfies this requirement. A total of $6.9 million in loans were pledged on this facility as of March 31, 2024. A total of $6.0 million in loans were pledged on this facility as of December 31, 2023. At March 31, 2024 and December 31, 2023, there were no outstanding borrowings on the KCT Warehouse LOC. In addition, on June 6, 2022, the Company entered into an Operating Line of Credit Loan and Security Agreement with the KCT, the KCT Operating LOC. The KCT Operating LOC is a $5.0 million short-term demand credit facility with a one-year maturity date ending on June 6, 2024. The KCT Operating LOC will automatically renew for another one-year term unless The Company may draw funds on the KCT Operating LOC at any time until the line is fully drawn. Repayment by the termination date or earlier if a collateral loan becomes more than 60 days delinquent, and the Company fails to cure such deficiency. The interest rate on the KCT Warehouse LOC is equal to the prime rate at the time of the draw plus 0.50%. At March 31, 2024, the interest rate on the KCT Warehouse LOC was 9.00%. To secure its obligations under the KCT Operating LOC, the Company has agreed to grant a priority first lien and security interest in certain of its mortgage loan investments and maintain a minimum collateralization ratio measured by taking the outstanding balance of mortgage notes pledged under the facility as compared to the total amount of principal owed less the secured cash on the KCT Operating LOC. The minimum ratio must equal at least 120%. A total of $5.0 million in loans were pledged on this facility as of March 31, 2024. A total of $4.6 million in loans were pledged on this facility as of December 31, 2023. At March 31, 2024, there were $4.5 million in borrowings on the KCT Operating LOC. At December 31, 2023, there were no outstanding borrowings on the KCT Operating LOC. The KCT Operating LOC and the KCT Warehouse LOC both contain typical affirmative covenants for a credit facility of this nature, including requiring that the Company maintain the pledged collateral free of liens and encumbrances, timely pay the amounts due under the facility and provide KCT with current financial statements and monthly reports. The Company will also be required to comply with certain financial covenants including maintaining a net worth of at least $5.0 million dollars, ensuring that its net worth is equal to at least 5% of its total liabilities and that it will maintain minimum liquidity that equals or exceeds 120% of the outstanding amount owed under the KCT Operating LOC and the KCT Warehouse LOC at the end of each calendar month. ACCU Line of Credit On September 23, 2021, Ministry Partners Investment Company, LLC, entered into a Loan and Security Agreement with ACCU. The ACCU LOC is a revolving $5.0 million short-term demand credit facility with an initial one-year maturity date of September 23, 2022. The facility was automatically renewed for an additional one-year term and now matures on September 23, 2024. The ACCU LOC will automatically renew for one The Company may draw funds on the ACCU LOC at any time until the line is fully drawn. All outstanding principal and interest amounts are due on the maturity date. To secure its obligations under the ACCU LOC, the Company has agreed to grant a priority first lien and security interest in certain of its mortgage loan investments and maintain a minimum collateralization ratio measured by taking outstanding balance of mortgage notes pledged under the facility as compared to the total amount of principal owed on the ACCU LOC. The minimum ratio must equal at least 120%. The Company must also maintain minimum liquidity that always equals or exceeds $10.0 million during the term of the loan. The ACCU LOC contains typical affirmative covenants for a credit facility of this nature. The Company was in compliance with these covenants at March 31, 2024. A total of $7.1 million and $7.2 million in loans were pledged on this facility as of March 31, 2024 and December 31, 2023, respectively. ACCU Secured Borrowings As detailed in “Note 3: Related Party Transactions,” on August 9, 2021, the Company entered into a Master Loan Participation Purchase and Sale Agreement with ACCU. The participations sold under the Master LP Agreement are considered secured borrowings and are presented as such on the Company’s balance sheet. $7 thousand in secured borrowings were outstanding under the Master LP Agreement as of March 31, 2024 and December 31, 2023. These borrowings have various contractual maturities ranging from 2028 to 2032. |
Debt Certificates Payable
Debt Certificates Payable | 3 Months Ended |
Mar. 31, 2024 | |
Debt Disclosure [Abstract] | |
Debt Certificates Payable | Note 11: Debt Certificates Payable The table below provides information on the Company’s debt certificates payable (dollars in thousands): As of As of March 31, 2024 December 31, 2023 SEC Registered Public Offerings Offering Type Amount Weighted Average Interest Rate Amount Weighted Average Interest Rate Class 1A Offering Unsecured $ 10,142 4.04 % $ 12,555 4.19 % 2021 Class A Offering Unsecured 66,240 4.96 % 69,421 4.95 % 2024 Class A Offering Unsecured 4,799 5.01 % — — % Public Offering Total $ 81,181 4.55 % $ 81,976 4.83 % Private Offerings Offering Type Subordinated Notes Unsecured $ 14,539 4.83 % $ 15,055 4.76 % Private Offering Total $ 14,539 4.83 % $ 15,055 4.76 % Total Debt Certificates Payable $ 95,720 4.60 % $ 97,031 4.82 % Future maturities for the Company’s debt certificates during the twelve-month periods ending March 31, are as follows (dollars in thousands): 2025 $ 46,638 2026 22,958 2027 18,359 2028 3,860 2029 3,905 Total $ 95,720 Debt issuance costs 130 Debt certificates payable, net of debt issuance costs $ 95,590 Debt issuance costs related to the Company’s debt certificates payable, net of amortization, were $130 thousand and $52 thousand at March 31, 2024 and December 31, 2023, respectively. The debt certificates are payable to investors who have purchased the securities. Debt certificates pay interest at stated spreads over an index rate. At their option, the investor may reinvest the interest or have the interest paid to them. The Company may repurchase all or a portion of an outstanding debt certificate at any time at its sole discretion. In addition, the Company may permit an investor to redeem all or a portion of a debt certificate prior to maturity at its sole discretion. SEC Registered Public Offerings Class 1A Offering In February 2018, the Company launched its Class 1A Notes Offering. Pursuant to a Registration Statement declared effective on February 27, 2018, the Company registered $90 million of its Class 1A Notes in two series – fixed and variable notes. The Class 1A Notes are unsecured. The interest rate paid on the Fixed Series Notes is determined in reference to a Constant Maturity Treasury Index published by the U.S. Department of Treasury (“ CMT Index Class 1A Notes under a Trust Indenture entered into by and between the Company and U.S. Bank. The Class 1A Offering expired on December 31, 2020. 2021 Class A Offering In January 2021, the Company launched its 2021 Class A Notes Offering. Pursuant to a Registration Statement declared effective on January 8, 2021, the Company registered $125 million of its 2021 Class A Notes in two series – fixed and variable notes. The 2021 Class A Notes are unsecured. Like the Class 1A Notes Offering, the interest rate paid on the Fixed Series Notes is determined in reference to a CMT Index published by the U.S. Department of Treasury in effect on the date that the note is issued plus a rate spread as described in the Company’s 2021 Class A Prospectus. The variable index in effect on the date the interest rate is set determines the interest rate paid on a Variable Series Note. The CMT Index refers to the Constant Maturity Treasury rates published by the U.S. Department of Treasury for actively traded Treasury securities. The variable index is equal to the 3-month LIBOR rate but was replaced by the Secured Overnight Financing Rate (“ SOFR 2024 Class A Offering In February 2024, the Company launched its 2024 Class A Debt Certificates Offering. Pursuant to a Registration Statement declared effective on February 5, 2024, the Company registered $200 million of its 2024 Class A Debt Certificates in two series – fixed and variable debt certificates. The 2024 Class A Debt Certificates are unsecured. The interest rate paid on the Fixed Series Debt Certificates is determined in reference to a CMT Index published by the U.S. Department of Treasury in effect as of the first business day of the month in which the note is issued plus a rate spread as described in the Company’s 2024 Class A Prospectus. The CMT Index refers to the Constant Maturity Treasury rates published by the U.S. Department of Treasury for actively traded Treasury securities. The variable index in effect on the date the interest rate is set determines the interest rate paid on a Variable Series Debt Certificate. The variable index is equal to the SOFR for three-month financial obligations. The 2024 Class A Certificates contain restrictive covenants pertaining to paying dividends, making redemptions, acquiring, purchasing, or making certain payments, requiring the maintenance of minimum tangible net worth, limitations on the issuance of additional notes, and incurring of indebtedness. The Company is in compliance with these covenants as of March 31, 2024. The Company issued the 2024 Class A Debt Certificates under a Trust Indenture entered into between the Company and U.S. Bank. Private Offerings Series 1 Subordinated Capital Notes (“Subordinated Notes”) In July 2022, the Company renewed the offer and sale of its Subordinated Notes initially launched in February 2013. The Company offers the notes pursuant to a limited private offering to qualified investors that meet the requirements of Rule 506 of Regulation D. The Company offers the Subordinated Notes with maturity terms from 12 to 60 months at an interest rate fixed on the date of issuance, as determined by the then current seven-day Under the Subordinated Notes offering, the Company is subject to certain covenants, including limitations on restricted payments, limitations on the dollar amount of notes that it can sell, restrictions on mergers and acquisitions, and proper maintenance of books and records. The Company was in compliance with these covenants as of March 31, 2024 and December 31, 2023. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2024 | |
Commitments and Contingencies [Abstract] | |
Commitments and Contingencies | Note 12: Commitments and Contingencies Unfunded Commitments The Company is a party to credit-related financial instruments with off-balance-sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include un-advanced lines of credit and standby letters of credit. Such commitments may involve elements of credit and interest rate risk that is greater than the amount stated on the balance sheet. The contractual amount of these commitments represents the Company’s exposure to credit loss. The Company uses the same credit policies in making commitments as it does for on-balance-sheet instruments. The table below shows the outstanding financial instruments whose contract amounts represent credit risk (dollars in thousands): Contract Amount at: March 31, 2024 December 31, 2023 Undisbursed loans $ 478 $ 221 Standby letter of credit 2,000 — Undisbursed loans are commitments for potential future extensions of credit to existing customers. These loans are sometimes unsecured, and the borrower may not necessarily draw upon the line the total amount of the commitment. Commitments to extend credit generally carry variable rates. Upon the adoption of CECL on January 1, 2023, the Company made an adjustment to retained earnings of $1 thousand based on its calculation of the estimated losses in its undisbursed loan commitments. This calculation includes an analysis of the risk presented by the loans on which there exist unfunded commitments as well as the probability that those funds will be disbursed. This estimate is subject to change as the commitments mature or are drawn upon. The balance of the allowance for credit losses on off-balance sheet commitments is recorded in other liabilities on the Company’s consolidated balance sheet. The following table details activity in the allowance for credit losses on off-balance sheet commitments (dollars in thousands): Three months ended Year ended March 31, 2024 December 31, 2023 Balance, beginning of period $ 2 $ — Adjustment related to implementation of CECL model — 1 Provision for losses on unfunded commitments — 1 Balance, end of period $ 2 $ 2 Operating Leases The Company has a lease agreement for its offices in Brea, California and a vehicle used by executive management. In February 2024, the Company reached an agreement with Olen Pointe Brea Corp. to lease new office space in Brea. The lease agreement commenced on March 15, 2024, with a provision for early possession of the premises effective February 29, 2024. The agreement expires on July 31, 2029. The agreement provides for rent payments beginning at $6,790 per month with annual increases, as well as provisions for a proportional share of operating costs. The agreement also includes one option to extend the lease for an additional five-year term. The calculation of the right-of-use asset for this lease agreement did not include this option to extend, as the Company has not determined that it is likely it will exercise the option. The Company recorded $387 thousand in right-of-use assets and lease liabilities In April 2022, the Company signed a three-year lease renewal agreement for its Fresno office beginning May 1, 2022, and terminating April 30, 2025. The agreement does not contain any options to renew. The lease payments associated with the renewal have been included in the future minimum lease payments table below. The Company has determined that all of its leases are operating leases. The table below presents information regarding our existing operating leases (dollars in thousands): For the Three months ended Year ended March 31, December 31, 2024 2023 2023 Lease cost Operating lease cost $ 45 $ 44 $ 176 Other information Cash paid for operating leases 13 51 190 Right-of-use assets obtained in exchange for operating lease liabilities 387 — — Lease liabilities recorded 387 — — Weighted average remaining lease term (in years) 4.80 1.27 1.24 Weighted-average discount rate 4.60 % 4.28 % 3.64 % Future minimum lease payments and lease costs for the twelve months ending March 31, are as follows (dollars in thousands): Lease Payments Lease Costs 2025 $ 89 $ 117 2026 87 84 2027 87 82 2028 89 82 2029 92 82 Thereafter 31 27 Total $ 475 $ 474 |
Preferred and Common Units unde
Preferred and Common Units under LLC Structure | 3 Months Ended |
Mar. 31, 2024 | |
Stockholders' Equity Note [Abstract] | |
Preferred and Common Units under LLC Structure | Note 13: Preferred and Common Units under LLC Structure Holders of the Series A Preferred Units are entitled to receive a quarterly cash The Series A Preferred Units have a liquidation preference of $100 per unit and have no voting rights. They are also subject to redemption in whole or in part at the Company’s election on December 31 of any year for an amount equal to the liquidation preference of each unit, plus any accrued and declared but unpaid quarterly dividends and preferred distributions on such units. The Series A Preferred Units have priority as to earnings and distributions over the Common Units. The resale of the Company’s Series A Preferred Units and Common Units are subject to the Company’s first right of refusal to purchase units proposed to be transferred. Upon the Company’s failure to pay quarterly dividends for four consecutive quarters, the holders of the Series A Preferred Units have the right to appoint two managers to the Company’s Board of Managers. The Class A Common Units have voting rights, but have no liquidation preference or rights to dividends, unless declared. |
Retirement Plans
Retirement Plans | 3 Months Ended |
Mar. 31, 2024 | |
Retirement Benefits [Abstract] | |
Retirement Plans | Note 14: Retirement Plans 401(k) All the Company’s employees are eligible to participate in the Automated Data Processing, Inc. (“ ADP No Profit Sharing The profit-sharing plan is for all employees who, at the end of the calendar year, are at least 21 years old, still employed, and have at least 900 Supplemental Executive Retirement Plan On March 30, 2022, the Company entered into a SERP with its former President and Chief Executive Officer, Joseph W. Turner, Jr. The SERP is an unfunded non-qualified plan that is intended to provide Mr. Turner with a fixed benefit over a ten-year period after Mr. Turner incurs a separation from service with the Company. The SERP has been established as a supplemental retirement and death benefits arrangement that conforms with the provisions of Section 409(A) of the Internal Revenue Code. For purposes of the SERP, Mr. Turner’s accrued benefit is subject to a maximum sum of $600,000, with payments made annually in equal monthly installments over a ten-year period. The agreement was amended in 2023 to change the vesting date of the benefits to December 2023. When Mr. Turner retired on December 15, 2023, the entire amount of this benefit had vested. Mr. Turner is entitled to receive $60,000 per year over a ten-year period, payable in equal monthly installments commencing the first day of the month following his separation from service. As Mr. Turner is currently performing consulting services for the Company, the Company does not expect his separation from service to occur until July 2024. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2024 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 15: Fair Value Measurements Fair Value Measurements Using Fair Value Hierarchy The Company classifies measurements of fair value within a hierarchy based upon inputs that give the highest priority to quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The fair value hierarchy is as follows: ● Level 1 inputs are quoted prices (unadjusted) for identical assets or liabilities in active markets. ● Level 2 inputs include: o quoted prices for similar assets and liabilities in active markets, o quoted prices for identical assets and liabilities in inactive markets, o inputs that are observable for the asset or liability (such as interest rates, prepayment speeds, credit risks, etc.); or o inputs that are derived principally from or corroborated by observable market data by correlation or by other means. ● Level 3 inputs are unobservable and reflect an entity’s own assumptions about the assumptions that market participants would use in pricing the assets or liabilities. In certain cases, the inputs used to measure fair value of an asset or liability may fall into multiple levels of the fair value hierarchy. However, in these cases, the asset or liability is classified to only one level of the hierarchy. To determine which level of the hierarchy the asset or liability is classified as a whole, the Company uses the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. Fair Value of Financial Instruments The following tables show the carrying amounts and estimated fair values of the Company’s financial instruments (dollars in thousands): Fair Value Measurements at March 31, 2024 using Carrying Value Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Fair Value FINANCIAL ASSETS: Cash and restricted cash $ 12,953 $ 12,953 $ — $ — $ 12,953 Certificates of deposit 1,251 — 1,251 — 1,251 Loans, net 99,901 — — 97,407 97,407 Investment in joint venture 870 — — 870 870 Other investments 1,053 — — 1,053 1,053 Accrued interest receivable 464 — — 464 464 Servicing assets 88 — — 88 88 FINANCIAL LIABILITIES: Lines of credit $ 7,500 $ — $ — $ 7,500 $ 7,500 Other secured borrowings 7 — — 7 7 Debt certificates payable 95,590 — — 95,624 95,624 Other financial liabilities 514 — — 514 514 Fair Value Measurements at December 31, 2023 using Carrying Value Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Fair Value FINANCIAL ASSETS: Cash and restricted cash $ 12,611 $ 12,611 $ — $ — $ 12,611 Certificates of deposit 1,279 — 1,275 — 1,275 Loans, net 98,573 — — 95,913 95,913 Investments in joint venture 871 — — 871 871 Other investments 1,052 — — 1,052 1,052 Accrued interest receivable 432 — — 432 432 Servicing assets 98 — — 98 98 FINANCIAL LIABILITIES: Lines of credit $ 4,500 $ — $ — $ 4,501 $ 4,501 Other secured borrowings 7 — — 7 7 Debt certificates payable 96,979 — — 97,399 97,399 Other financial liabilities 531 — — 531 531 Management uses judgment in estimating the fair value of the Company’s financial instruments; however, there are inherent weaknesses in any estimation technique. Therefore, for substantially all financial instruments, the fair value estimates presented herein are not necessarily indicative of the amounts the Company could have realized in a sales transaction at March 31, 2024 and December 31, 2023. The Company used the following methods and assumptions to estimate the fair value of financial instruments: Cash and restricted cash – The carrying amounts reported in the balance sheets approximate fair value for cash. Certificates of deposit – Management estimates fair value by using a present value discounted cash flow with a discount rate approximating the current market rate for similar assets. Management classifies certificates of deposits as Level 2 of the fair value hierarchy. Loans (other than collateral-dependent impaired loans) – Management estimates fair value by discounting the future cash flows of the loans. The discount rate the Company uses is the current average rates at which it would make loans to borrowers with similar credit ratings and for the same remaining maturities. Investments in joint venture – Management estimates fair value by analyzing the operations and marketability of the underlying investment to determine if the investment is other-than-temporarily impaired. Other investments – Management estimates fair value by determining whether there is an indication of potential lack of performance on the part of the insurance companies in which the investments are made, and whether those indications would impair the investments. Accrued interest receivable - The carrying amounts reported in the balance sheets approximate fair value for accrued interest receivable. The Company has made the accounting policy election not to measure an allowance for credit losses on accrued interest receivable amounts as the Company writes off accrued interest receivable when a loan is 90 days past due or interest is otherwise considered uncollectible. Servicing assets – Servicing assets are included in other assets on the balance sheets. The carrying amounts reported in the balance sheets approximate fair value for servicing assets. Debt certificates payable – Management estimates the fair value of fixed maturity notes by discounting the future cash flows of the notes. The discount rate the Company uses is the rates currently offered for debt certificates payable of similar remaining maturities. Company management estimates the discount rate by using market rates that reflect the interest rate risk inherent in the notes. Lines of Credit, Term-debt, Other Secured Borrowings – Management estimates the fair value of borrowings from financial institutions discounting the future cash flows of the borrowings. The discount rate the Company uses is the current incremental borrowing rate for similar types of borrowing arrangements. Off-Balance Sheet Instruments – Management determines the fair value of loan commitments on fees currently charged to enter into similar agreements, taking into account the remaining term of the agreements and the counterparties’ credit standing. The fair value of loan commitments is insignificant at March 31, 2024 and December 31, 2023. Fair Value Measured on a Nonrecurring Basis The Company measures certain assets at fair value on a nonrecurring basis. On these assets, the Company only makes fair value adjustments in certain circumstances (for example, when there is evidence of impairment). The following table presents the fair value of assets measured on a nonrecurring basis (dollars in thousands): Fair Value Measurements Using: Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Assets at March 31, 2024: Collateral-dependent impaired loans (net of allowance and discount) $ — $ — $ 2,870 $ 2,870 Investment in joint venture — — 870 870 Other investments — — 1,053 1,053 Foreclosed assets (net of allowance) — — 301 301 Total $ — $ — $ 5,094 $ 5,094 Assets at December 31, 2023: Collateral-dependent loans (net of allowance and discount) $ — $ — $ 2,896 $ 2,896 Investments in joint venture — — 871 871 Other investments — — 1,052 1,052 Foreclosed assets (net of allowance) — — 301 301 Total $ — $ — $ 5,120 $ 5,120 Impaired Loans The Company measures impaired loans at fair value on a nonrecurring basis. Once a loan is considered impaired, the fair value is measured using one of several methods, including collateral liquidation value, the market value of similar debt, or discounted cash flows. Most often management uses the fair value of the underlying real estate collateral to value impaired loans. Such fair values are obtained using independent appraisals, which the Company considers to be Level 3 inputs. The range of these discounts is shown in the table below. Foreclosed Assets The Company initially records real estate acquired through foreclosure or other proceedings (foreclosed assets) at fair value at the date of foreclosure less estimated costs of disposal, which establishes a new cost. After foreclosure, management periodically performs valuations on foreclosed assets. The Company carries foreclosed assets held for sale at the lower of cost or fair value, less estimated costs of disposal. The fair values of real properties initially are determined based on appraisals. Management may adjust the appraised values for a range of factors including age of the appraisal, age of comparable properties included in the appraisal, and known changes in the market or in the collateral. The Company makes subsequent valuations of the real properties based either on management estimates or on updated appraisals. If management makes significant adjustments to appraised values based on unobservable inputs, the Company categorizes foreclosed assets under Level 3. Otherwise, if management bases the foreclosed assets’ value on recent appraisals and the only adjustments made are for known contractual selling costs, the Company will categorize the foreclosed assets under Level 2. Other Investments Other investments comprise two indexed annuity insurance contracts. The Company measures fair value on its annuity investments on a nonrecurring basis. On these assets, the Company only makes fair value adjustments when there is evidence of impairment. As the principal amounts and recognized income on the annuities is guaranteed, only impairment of the assets would indicate a degradation in their fair value. The Company concluded that no impairment of the annuity investments existed at March 31, 2024 and December 31, 2023. As such, the Company has determined that the carrying value of its other investments equals its fair value at March 31, 2024 and December 31, 2023. The table below summarizes the valuation methodologies used to measure the fair value adjustments for Level 3 assets recorded at fair value on a nonrecurring basis (dollars in thousands): March 31, 2024 Assets Fair Value (in thousands) Valuation Techniques Unobservable Input Range (Weighted Average) Impaired Loans $ 2,870 Discounted appraised value Selling cost / Estimated market decrease 10% (10%) Investment in joint venture 870 Internal evaluations Estimated future market value 0% (0%) Other investments 1,053 Internal evaluations Indications of non-performance by insurance companies 0% (0%) Foreclosed Assets 301 Internal evaluations Selling cost 6% (6%) December 31, 2023 Assets Fair Value (in thousands) Valuation Techniques Unobservable Input Range (Weighted Average) Impaired loans $ 2,896 Discounted appraised value Selling cost / Estimated market decrease 10% (10%) Investments in joint venture 871 Internal evaluations Estimated future market value 0% (0%) Other investments 1,052 Internal evaluations Indications of non-performance by insurance companies 0% (0%) Foreclosed assets 301 Internal evaluations Selling cost 6% (6%) |
Income Taxes and State LLC Fees
Income Taxes and State LLC Fees | 3 Months Ended |
Mar. 31, 2024 | |
Income Tax Disclosure [Abstract] | |
Income Taxes and State LLC Fees | Note 16: Income Taxes and State LLC Fees MPIC is subject to a California gross receipts LLC fee of approximately $12,000 per year, and the state minimum franchise tax of $800 per year. MP Securities is subject to a California gross receipts LLC fee of approximately $6,000 and the state minimum franchise tax of $800 per year. MP Realty incurred a tax loss for the years ended December 31, 2023, and 2022, and recorded a provision of $800 per year for the state minimum franchise tax. For the years ended December 31, 2022, and 2021, MP Realty had federal and state net operating loss carryforwards of approximately $432 thousand and $422 thousand, respectively, which begin to expire in the year 2032 MPC is a private foundation that is subject to a federal excise tax on net investment income. It may reduce its federal excise tax rate from 2% to 1% by exceeding a certain payout target for the year. MPC’s provision for current federal excise tax is based on a 1% rate on net investment income. Each year the current federal excise tax is levied on interest and dividend income and net realized gains (if any). In addition, MPC may become subject to current federal and state unrelated business income (“ UBI Tax years ended December 31, 2020, through December 31, 2023, remain subject to examination by the Internal Revenue Service and the tax years ended December 31, 2019, through December 31, 2023, remain subject to examination by the California Franchise Tax Board and various other state jurisdictions. |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2024 | |
Segment Reporting [Abstract] | |
Segment Information | Note 17: Segment Information The Company’s reportable segments are strategic business units that each offer a unique set of products and services that differ from each other. The Company manages the segments separately because each business requires different management, personnel skills, and marketing strategies. The Company has three reportable segments that represent the primary businesses reported in the consolidated financial statements: the finance company (the parent company), the broker-dealer (MP Securities), and the charitable organization (Ministry Partners for Christ). The finance company segment uses funds from the sale of debt certificates, income from operations, and the sale of loan participations to originate or purchase mortgage loans. The finance company also services loans. MP Securities generates fee income by selling debt certificates and other investment and insurance products, as well as providing investment advisory and financial planning services. The charitable organization, MPC, accepts contributions and makes charitable grants to Christian educational organizations. The accounting policies applied to determine the segment information are the same as those described in the summary of significant accounting policies. Management accounts for intersegment revenues and expenses at amounts that assume the Company entered into the transaction with unrelated third parties at the current market prices at the time of the transaction. Management evaluates the performance of each segment based on net income or loss before provision for income taxes and LLC fees. Financial information with respect to the reportable segments is as follows (dollars in thousands): Three months ended March 31, 2024 March 31, 2023 Revenue from external sources Finance Company* $ 1,774 $ 1,416 Broker-Dealer 300 247 Charitable Organization 20 400 Adjustments / Eliminations (72) — Total $ 2,022 $ 2,063 Revenue from internal sources Finance Company $ — $ — Broker-Dealer 159 461 Charitable Organization — — Adjustments / Eliminations (159) (461) Total $ — $ — Interest expense Finance Company $ 1,609 $ 1,252 Broker-Dealer — — Charitable Organization — — Adjustments / Eliminations (344) (334) Total $ 1,265 $ 918 Total non-interest expense and provision for tax Finance Company $ 750 $ 961 Broker-Dealer 407 414 Charitable Organization 31 — Adjustments / Eliminations (30) — Total $ 1,158 $ 1,375 Net profit (loss) Finance Company $ (533) $ (636) Broker-Dealer 50 295 Charitable Organization (10) 400 Adjustments / Eliminations 144 (127) Total $ (349) $ (68) March 31, December 31, 2024 2023 (Unaudited) (Audited) Total assets Finance Company $ 110,859 $ 109,724 Broker-Dealer 5,020 4,977 Charitable Organization 2,097 2,108 Other Segments 57 56 Adjustments / Eliminations (86) (218) Total $ 117,947 $ 116,647 |
Not-for-profit Subsidiary Activ
Not-for-profit Subsidiary Activities | 3 Months Ended |
Mar. 31, 2024 | |
Not-for-profit Subsidiary Activities | |
Not-for-profit Subsidiary Activities | Note 18: Not-for-profit Subsidiary Activities The following represent required disclosures related to the activities of MPC, the Company’s wholly owned, not-for-profit organization. At March 31, 2024 and December 31, 2023, the Company had $341 thousand and $304 thousand, respectively in cash held in a checking account available to meet general expenditure needs for the next twelve months. This does not include $1.7 million in cash that carries permanent donor restrictions. There were no board-designated funds as of March 31, 2024 and December 31, 2023. Management believes the cash available for use by MPC is sufficient to cover its expenses. At March 31, 2024, MPC had $2.1 million in net assets, $1.7 million of which is permanently restricted by donors. MPC earned interest income of $20 thousand during the three months ended March 31, 2024. MPC earned less than $1 thousand in interest income during the three months ended March 31, 2023. At March 31, 2024 and December 31, 2023, respectively, MPC had $358 thousand and $368 thousand, respectively, in net assets, none of which was permanently restricted by donors. A breakdown of expenses for MPC for the three-month periods ended March 31, 2024 and 2023, is as follows: Three months ended March 31, 2024 March 31, 2023 Expenses Charitable grants $ 30 $ — General and administrative expenses 1 — Total $ 31 $ — The change in net assets for MPC for the three-month periods ended March 31, 2024 and 2023 is as follows: Three months ended March 31, 2024 March 31, 2023 Change in net assets $ (10) $ 400 |
Nature of Business and Summar_2
Nature of Business and Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2024 | |
Accounting Policies [Abstract] | |
Nature of Business | Nature of Business Throughout these notes to consolidated financial statements, we refer to Ministry Partners Investment Company, LLC and its subsidiaries as “the Company.” Formed in California in 1991, the Company is a financial services organization specializing in both financing ministries through funding commercial real property secured loans and providing investment services to the Christian community. The Company funds its investments in ministry loans primarily through the sale of debt certificates. The Company’s wholly-owned subsidiaries are: ● Ministry Partners Funding, LLC, a Delaware limited liability company (“ MPF ”); ● MP Realty Services, Inc., a California corporation (“ MP Realty ”); ● Ministry Partners Securities, LLC, a Delaware limited liability company (“ MP Securities ”); and ● Ministry Partners for Christ, Inc., a not-for-profit Delaware corporation (“ MPC ”). The Company formed MPF in 2007 and then deactivated the subsidiary on November 30, 2009. In December 2014, the Company reactivated MPF to enable it to serve as collateral agent for loans held as collateral for its Secured Investment Certificates. The Company formed MP Realty in November 2009, and obtained a license to operate as a corporate real estate broker through the California Department of Real Estate on February 23, 2010. MP Realty has conducted limited operations to date. The Company formed MP Securities on April 26, 2010, to provide investment and financial planning solutions for individuals, churches, charitable institutions, and faith-based organizations. MP Securities acts as the selling agent for the Company’s public and private placement notes. The Company formed MPC on December 28, 2018, to be used exclusively for religious and charitable purposes within the meaning of Section 501(c)(3) of the U.S. Internal Revenue Code of 1986 (“ IRC ”). MPC is a not-for-profit corporation formed and organized under Delaware law. MPC makes charitable grants to Christian educational organizations, and provides accounting, consulting, and financial expertise to aid Christian ministries. On August 23, 2019, the Internal Revenue Service granted MPC tax-exempt status as a private foundation under Section 501(c)(3) of the IRC. The MPC Board of Directors approved its first charitable grants during the year ended December 31, 2020. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of Ministry Partners Investment Company, LLC and its wholly-owned subsidiaries. Management eliminates all significant inter-company balances and transactions in consolidation. |
Conversion to LLC | Conversion to LLC Effective December 31, 2008, the Company converted from a corporation organized under California law to a California limited liability company. After this conversation, the separate existence of Ministry Partners Investment Corporation ceased and the entity continued by operation of law under the name Ministry Partners Investment Company, LLC. As an LLC, a group of managers provides oversight of the Company’s affairs. The managers have full, exclusive, and complete discretion, power, and authority to oversee the management of Company affairs. An Operating Agreement governs the Company’s management structure and governance procedures. |
Risks and Uncertainties | Risks and Uncertainties COVID-19, a global pandemic, adversely impacted the broad economy, affecting most industries, including businesses, schools, hospitality-, and travel-based employers, and disrupted the supply and distribution networks that deliver products to the consuming public. While the pandemic has ended, we cannot know at this time if there will be any negative long-term effects to in-person attendance and giving trends at faith-based organizations and churches. Negative attendance and giving trends impacting the organizations that the Company serves could have a material financial impact on the Company. In addition, Russia’s invasion of Ukraine, increasing current levels of inflation, the disruption of global supply chains, rising interest rates, and recent bank failures are putting strain on the U.S. economy and the U.S. consumer. While it is not possible to know the full extent of the long-term impact of these current events, the Company is disclosing potentially material factors that could impact our business of which it is aware. |
Cash, and Cash Equivalents | Cash, and Cash Equivalents Cash equivalents include time deposits, and all highly liquid debt instruments with original maturities of three months or less. The Company had demand deposits and money market deposit accounts as of March 31, 2024 and December 31, 2023. The National Credit Union Share Insurance Fund insures a portion of the Company’s cash held at credit unions, and the Federal Deposit Insurance Corporation insures a portion of cash held by the Company at other financial institutions. The Company holds cash deposits that may exceed insured limits. Management does not expect to incur losses in these cash accounts. The Company maintains cash accounts with Royal Bank of Canada Dain Rauscher (“ RBC Dain CRD ACCU |
Certificates of Deposit | Certificates of Deposit Certificates of deposit include investments in certificates of deposit held at financial institutions that carry original maturities of greater than three months. The Company had $1.3 million in certificates with terms of greater than three months as of March 31, 2024, and December 31, 2023. |
Use of Estimates | Use of Estimates The Company’s creation of consolidated financial statements that conform to United States Generally Accepted Accounting Principles (" GAAP ") requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. These estimates govern areas such as the allowance for credit losses and the fair value of financial instruments and foreclosed assets. Actual results could differ from these estimates. |
Investments in Joint Venture | Investments in Joint Venture In 2016, the Company entered into a joint venture agreement to develop and sell property we acquired as part of a Deed in Lieu of Foreclosure agreement reached with one of our borrowers. The joint venture owns a property located in Santa Clarita, California. The Company accounts for its investment in the joint venture using the equity method of accounting. Under this method, the Company records its proportionate share of the joint venture’s net income or loss in the statement of operations. On a periodic basis, or whenever events or circumstances arise that would necessitate analysis, management analyzes the Company’s investment in the joint venture for impairment. In this analysis, management compares the carrying value of the investment to the estimated value of the underlying real property. The Company records any impairment charges as a valuation allowance against the value of the asset. Management records these valuation changes as realized gains or losses on investment on the Company’s consolidated statements of operations. Management determined that investment in the joint venture was not impaired as of March 31, 2024. |
Other investments | Other Investments In June 2022, MP Securities purchased two ten-year fixed annuities from insurance companies. These annuities each carry unique features, including guaranteed fixed income components, variable income components, premium bonuses, and potential withdrawal charges. The Company carries these investments at cost and adjusts for guaranteed income when such income is realized. The principal balances of these annuities are guaranteed but are not insured; however, management determined that the annuities were not impaired as of March 31, 2024, and December 31, 2023, and does not anticipate losses. |
Loans Receivable | Loans Receivable The Company reports loans that management has the intent and ability to hold for the foreseeable future at their outstanding unpaid principal balance adjusted for an allowance for expected credit losses, deferred loan fees and costs, and loan discounts. |
Interest Accrual on Loans Receivable | Interest Accrual on Loans Receivable The Company accrues loan interest income daily. Management defers loan origination fees and costs generated in making a loan. The Company amortizes these fees and costs as an adjustment to the related loan yield using the interest method. Loan discounts can arise from interest accrued and unpaid which the Company adds to loan principal balances when it modifies the loan. The Company does not accrete discounts to income on impaired loans. However, when management determines that a previously impaired loan is no longer impaired, the Company begins accreting loan discounts to interest income over the term of the modified loan. For loans purchased from third parties, loan discounts include differences between the purchase price and the recorded principal balance of the loan. The Company accretes these discounts to interest income over the term of the loan using the interest method. Management considers a loan impaired if it concludes that the collection of principal or interest according to the terms of the loan agreement is doubtful. The Company stops the accrual of interest when management determines the loan is impaired. For loans that the Company places on non-accrual status, management reverses all uncollected accrued interest against interest income. Management accounts for the interest on these loans on the cash basis or cost-recovery method until the loan qualifies for return to accrual status. It is not until all the principal and interest amounts contractually due are brought current and future payments are reasonably assured that the Company returns a loan to accrual status. |
Allowance for Expected Credit Losses | Allowance for Expected Credit Losses The Company sets aside an allowance for expected credit losses by charging the provision for expected credit losses account on the Company’s consolidated statements of operations. This charge decreases the Company’s earnings. Management charges off the part of loan balances it believes it will not collect against the allowance. The Company credits subsequent recoveries, if any, to the allowance. Loan Portfolio Segments and Classes Management separates the loan portfolio into portfolio segments for purposes of evaluating the allowance for expected credit losses. A portfolio segment is defined as the level at which the Company develops and documents a systematic method for determining its allowance for expected credit losses. The Company segments the loan portfolio based on loan types and the underlying risk factors present in each loan type. Management periodically reviews and revises such risk factors, as it considers appropriate. The Company’s loan portfolio comprises two segments: ministry-related non-profit loans and commercial loans. The risk characteristics of the Company’s portfolio segments are as follows: Non-profit Commercial Loans For-profit Commercial Loans The Company has also segregated its portfolio into the following classes, which are a subsets of segments: Management has segregated the loan portfolio into the following portfolio classes: Loan Class Class Description Wholly Owned First Collateral Position, Amortizing Wholly owned loans and the retained portion of loans originated by the Company and sold for which the Company possesses a senior lien on the collateral underlying the loan. This class contains only those loans that amortize based on an agreed upon contractual principal and interest payments. Wholly Owned Other Collateral Position, Amortizing Wholly owned loans and the retained portion of loans originated by the Company and sold for which the Company possesses a lien on the underlying collateral that is superseded by another lien on the same collateral or that is secured by collateral other than real property. This class contains only those loans that amortize based on an agreed upon contractual principal and interest payments. These loans present higher credit risk than loans for which the Company possesses a senior lien due to the increased risk of loss should the loan default. Wholly Owned Unsecured, Amortizing Wholly owned loans and the retained portion of loans originated by the Company and sold for which the Company does not possess an interest in collateral securing the loan. This class contains only those loans that amortize based on an agreed upon contractual principal and interest payments. These loans present higher credit risk than loans for which the Company possesses a lien due to the increased risk of loss should the loan default. Wholly Owned Other Collateral Position, Lines of Credit Wholly owned loans and the retained portion of loans originated by the Company and sold for which the Company possesses a lien on the underlying collateral that is superseded by another lien on the same collateral or that is secured by collateral other than real property. This class contains only line of credit agreements. Wholly Owned Unsecured, Lines of Credit Wholly owned loans and the retained portion of loans originated by the Company and sold for which the Company does not possess an interest in collateral securing the loan. This class contains only line of credit agreements. Wholly Owned, Construction Wholly owned loans and the retained portion of loans originated by the Company and sold which have been made for the purpose of constructing real property to be used for the borrower’s ministry. These loans present different risks due to the nature of construction projects and the underlying collateral. Participations First Collateral Position Participated loans purchased from another financial entity for which the Company possesses a senior lien on the collateral underlying the loan. Loan participations purchased may present higher credit risk than wholly owned loans because disposition and direction of actions regarding the management and collection of the loans must be coordinated and negotiated with the other participants, whose best interests regarding the loan may not align with those of the Company. Participations Construction Loan participations purchased in loans made for the purpose of constructing commercial real property and where the collateral securing the property comprises the construction project. These loans present different risks due to the nature of construction projects and the underlying collateral. Finally, the Company segregates each class by risk rating, as loans determined to have lower credit quality present different and greater risk than those of higher credit quality. The Company’s credit quality grading system is described in detail below in the section titled “ Credit Quality Indicators Allowance for Expected Credit Loss Evaluation The Company adopted FASB Accounting Standards Update (ASU) No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments CECL In accordance with FASB Accounting Standards Update (ASU) No. 2019-04, Codification Improvements to Topic 326, Financial Instruments-Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments CECL Model The CECL methodology does not prescribe any specific model for determining expected losses. Management has determined that, due to the nature of the borrowings in its portfolio and the nature of the collateral securing a significant portion of its borrowings, it would use a “probability of default” calculation as the basis for estimating expected losses. This methodology uses information about the borrower, the loan, and the collateral securing the loan to determine a borrower’s ability to meet the contractual requirements of the loan agreement. It then applies a calculated probability that the borrower will default to the estimated amount of loss the Company would incur in a default scenario. To perform this calculation, the methodology requires management to collect and analyze certain data for the loans in its portfolio including: ● the value of collateral securing the loan, as supported by third-party appraisals or other valuations; ● adjustments to the collateral value related to geographical and economic trends, and estimated costs to sell; and ● the borrower’s ability to meet its contractual obligations as determined by financial information collected regularly from borrowers. All loans that the Company does not individually review use the probability of default calculation described above. In addition, management has determined that there are qualitative factors affecting expected credit losses for which the probability of default model cannot account. These qualitative factors represent significant issues that management considers likely to cause estimated credit losses associated with the Company’s existing portfolio to differ from the probability of default calculation. These factors are applied in varying degrees depending on a loan’s segment, class, and credit quality. Management adjusts these factors on an on-going basis, some of which include: ● changes in national, regional, and local economic and industry conditions that affect the collectability of the portfolio; ● changes in the volume and severity of past due loans, the volume of non-accrual loans, and the volume and severity of adversely classified loans; ● changes in the value of collateral, including the limitations of using commercial price indices to adjust collateral value; ● the inherent risk in borrowings with high loan-to-value figures; and ● broad trends in the Christian church industry in which the Company primarily lends. Loans that management has classified as non-performing and impaired receive a specific reserve. For such loans, an allowance is established when the carrying value of that loan is higher than the amount management expects to collect. Management uses multiple approaches to determine the amount the Company expects to collect. These include the discounted cash flow method, using the loan’s underlying collateral value reduced by expected selling costs, or using the observable market price of the impaired loan. Individually Reviewed The Company reviews its loan portfolio monthly by examining several data points. This process includes reviewing delinquency reports, any new information related to the financial condition of its borrowers, and any new appraisal or other collateral valuation. Throughout this process, the Company identifies potential impaired loans. Management generally deems a loan is impaired when current facts and circumstances indicate that it is probable a borrower will be unable to make payments according to the loan agreement. If management has not already deemed a loan impaired, it will classify the loan as non-accrual when it becomes 90 days or more past due. All loans in the loan portfolio are subject to impairment analysis. The Company monitors impaired loans on an ongoing basis as part of management’s loan review and work out process. Any loans that management has determined are non-performing and impaired are individually analyzed for potential losses. These loans include non-accrual loans, loans 90 days or more past due and still accruing, non-performing modified loans, and loans where the borrowers have defaulted on contractual terms of their loan agreement. ● Non-accrual loans are loans on which management has discontinued interest accruals. ● Modified loans are loans in which the Company has granted the borrower a concession due to financial distress. Concessions are usually a reduction of the interest rate or a change in the original repayment terms. ● Loans that have defaulted on other contractual terms could include loans where the borrower has failed to provide required financial information, has violated a covenant, or has otherwise failed to comply with the terms of the loan agreement. Management considers several factors when determining impairment status. These factors include the loan’s payment status, the value of any secured collateral, and the probability of collecting scheduled payments when due. Management generally does not classify loans that experience minor payment delays or shortfalls as impaired. Management determines the significance of payment delays or shortfalls on a case-by-case basis, taking into consideration all the circumstances surrounding the loan and the borrower. These circumstances include the length and reasons for the delay, the borrower’s payment history, and the amount of the shortfall in relation to the principal and interest owed. Management measures impairment on a loan-by-loan basis using one of three methods: ● the present value of expected future cash flows discounted at the loan’s effective interest rate; ● the obtainable market price; or ● the fair value of the collateral if the loan is collateral-dependent. A loan modification is a loan for which the Company, for reasons related to a borrower’s financial difficulties, grants a concession to a borrower that the Company would not otherwise consider. A modification of a loan usually involves an interest rate reduction, extension of the maturity date, payment reduction, or reduction of accrued interest owed on the loan on a contingent or absolute basis. Management considers loans that it renews at below-market terms to be loan modifications if the below-market terms represent a concession due to the borrower’s troubled financial condition. The Company classifies loan modifications as impaired loans. For the loans that are not considered to be collateral-dependent, management measures loan modifications at the present value of estimated future cash flows using the loan’s effective rate prior to the loan’s initial modification. The Company reports the change in the present value of cash flows related to the passage of time as interest income. If management considers the loan to be collateral-dependent, impairment is measured based on the fair value of the collateral. In accordance with industry standards, the Company classifies a loan as impaired if management has modified it as part of a loan modification. However, loan modifications, upon meeting certain performance conditions, are eligible to receive non-classified loan ratings (pass or watch) and to be moved out of non-accrual status. These loans continue to be classified as impaired loans but not necessarily as non-accrual or collateral-dependent loans. Modified loans can be included in the collectively reviewed pool of loans if they return to performing status. |
Loan Charge-offs | Loan Charge-offs Management charges off loans or portions thereof when it determines the loans or portions of the loans are uncollectible. The Company evaluates collectability periodically on all loans classified as “Loans of Lesser Quality.” Key factors management uses in assessing a loan’s collectability are the financial condition of the borrower, the value of any secured collateral, and the terms of any workout agreement between the Company and the borrower. In workout situations, the Company charges off the amount deemed uncollectible due to the terms of the workout, the inability of the borrower to make agreed upon payments, and the value of the collateral securing the loan. |
Credit Quality Indicators | Credit Quality Indicators The Company has established a loan grading system to assist its management in analyzing and monitoring the loan portfolio. The Company classifies loans it considers lesser quality (“ classified loans Pass: The borrower has sufficient cash to fund debt services. The borrower may be able to obtain similar financing from other lenders with comparable terms. The risk of default is considered low. Watch: These loans exhibit potential or developing weaknesses that deserve extra attention from credit management personnel. If the developing weakness is not corrected or mitigated, there may be deterioration in the ability of the borrower to repay the debt in the future. Management must report loans graded Watch to executive management and the Board of Managers (“ Board Special mention: These credit facilities exhibit potential or actual weaknesses that present a higher potential for loss under adverse circumstances and deserve management’s close attention. If uncorrected, these weaknesses may result in deterioration of the repayment prospects for the loan at some future date. Substandard: Management considers loans and other credit extensions bearing this grade to be inadequately protected by the current net worth and debt service capacity of the borrower or of any pledged collateral. These obligations, even if apparently protected by collateral value, have well-defined weaknesses related to adverse financial, managerial, economic, ministry, or environmental conditions which have clearly jeopardized repayment of principal and interest as originally intended. Furthermore, there is the possibility that some future loss will be sustained if such weaknesses are not corrected. Doubtful: This classification consists of loans that display the properties of substandard loans with the added characteristic that the severity of the weaknesses makes collection or liquidation in full highly questionable or improbable based upon currently existing facts, conditions, and values. The probability of some loss is very high, but because of certain important and reasonably specific factors, the amount of loss cannot be exactly determined. Such pending factors could include a merger or liquidation, additional capital injection, refinancing plans, or perfection of liens on additional collateral. Loss: Loans in this classification are considered uncollectible and cannot be justified as a viable asset. This classification does not mean the loan has absolutely no recovery value, but that it is neither practical nor desirable to defer writing off this loan even though partial recovery may be obtained in the future. |
Revenue Recognition | Revenue Recognition The Company recognizes two primary types of revenue: interest income and non-interest income. |
Interest Income | Interest Income The Company’s principal source of revenue is interest income from loans, which is not within the scope of ASU 2014-09, Revenue from Contracts with Customers and all subsequent amendments to the ASU (collectively, "ASC 606"). Refer to the discussion in “Loans Receivable” above to understand the Company’s recognition of interest income. |
Non-interest Income | Non-interest Income Non-interest income includes revenue from various types of transactions and services provided to customers. Contracts with customers can include multiple services, which are accounted for as separate “performance obligations” if they are determined to be distinct. Our performance obligations to our customers are generally satisfied when we transfer the promised good or service to our customer, either at a point in time or over time. Revenue from a performance obligation transferred at a point in time is recognized at the time that the customer obtains control over the promised good or service. Revenue from our performance obligations satisfied over time are recognized in a manner that depicts our performance in transferring control of the good or service, which is generally measured based on time elapsed, as our customers simultaneously receive and consume the benefit of our services as they are provided. Payment for the majority of our services is variable consideration, as the amount of revenues we expect to receive is subject to factors outside of our control, including market conditions. Variable consideration is only included in revenue when amounts are not subject to significant reversal, which is generally when uncertainty around the amount of revenue to be received is resolved. Wealth advisory fees Generally, management recognizes wealth advisory fees over time as the Company renders services to its clients. The Company receives these fees either based on a percentage of the market value of the assets under management, or as a fixed fee based on the services the Company provides to the client. The Company’s delivery of these services represents its related performance obligations. The Company typically collects the wealth advisory fees at the beginning of each quarter from the client’s account. Management recognizes these fees ratably over the related billing period as the Company fulfills its performance obligation. In addition, management recognizes any commissions or referral fees paid related to this revenue ratably over the related billing period as the Company fulfills its performance obligation. Investment brokerage fees Investment brokerage fees arise from the selling, distribution, and trade execution services. The Company’s execution of these services fulfills its related performance obligations. The Company also offers sales and distribution services and earns commissions through the sale of annuity and mutual fund products. The Company acts as an agent in these transactions and recognizes revenue at a point in time when the customer executes a contract with a product carrier. The Company may also receive trailing commissions and 12b-1 fees related to mutual fund and annuity products. Management recognizes this revenue in the period when it is earned, estimating the revenue, if necessary, based on the balance of the investment and the commission rate on the product. The Company earns and recognizes trade execution commissions on the trade date, which is when the Company fulfills its performance obligation. Payment for the trade execution is due on the settlement date. Lending Fees Lending fees represent charges earned for services we provide as part of the lending process, such as late charges, servicing fees, and documentation fees. The Company recognizes late charges as earned when they are paid. The Company recognizes revenue on other lending fees in the period in which the Company has performed the service. Gains on sales of loans receivable From time to time, the Company sells participation interests in loans receivable that it services. Upon completion of the loan sale, the Company recognizes a gain based on certain factors including the maturity date of the loan, the percentage of the loan sold and retained, and the servicing rate charged to the participant on the sold portion. Charitable contributions Charitable contributions include amounts that were donated by a not-for-profit charitable ministry to the Company’s not-for-profit subsidiary, MPC. This revenue comprises donations analyzed by management and determined to be unconditional, non-exchange transactions. Contributions are measured at their fair value at the date of contribution. All contributions are considered to be available for unrestricted use unless specifically restricted by the donor. Amounts received that are designated for future periods or restricted by the donor for specific purposes are reported as carrying donor restrictions. The $1.7 million in charitable contributions recognized during 2023, were permanently restricted by the donor as part of a designated fund agreement that allows for limited annual distributions. These funds are included in the restricted net assets of MPC and are presented on the balance sheet as part of retained earnings. Gains/losses on sales of foreclosed assets The Company records a gain or loss from the sale of foreclosed assets when control of the property transfers to the buyer, which generally occurs at the time of an executed deed. When the Company finances the sale of a foreclosed asset to the buyer, the Company assesses whether the buyer is committed to perform their obligation under the contract and whether collectability of the transaction price is probable, among other factors. Once these criteria are met, the foreclosed asset is derecognized and the gain or loss on sale is recorded upon the transfer of control of the property to the buyer. In determining the gain or loss on the sale, the Company adjusts the transaction price and related gain (loss) on sale if a significant financing component is present. Other non-interest income Other non-interest income includes fees earned based on service contracts the Company has entered into with credit unions. The Company recognizes the revenue monthly based on the terms of the contracts, which require monthly payments for services the Company performs. Other non-interest income also includes realized income and gains on other investments. |
Foreclosed Assets | Foreclosed Assets Management records assets acquired through foreclosure or other proceedings at fair market value less estimated costs of disposal. Management determines the fair value at the date of foreclosure, which establishes a new cost for the asset. After foreclosure, the Company carries the asset at the lower of cost or fair value, less estimated costs of disposal. Management evaluates these real estate assets regularly to ensure that the asset’s fair value supports the recorded amount. If necessary, management also ensures that valuation allowances reduce the carrying amount to fair value less estimated costs of disposal. Revenue and expense from the operation of the Company’s foreclosed assets and changes in the valuation allowance are included in net expenses from foreclosed assets. When the Company sells the foreclosed property, it recognizes a gain or loss on the sale equal to the difference between the net sales proceeds received and the carrying amount of the property. |
Transfers of Financial Assets | Transfers of Financial Assets Management accounts for transfers of financial assets as sales when the Company has surrendered control over the asset. Management deems the Company has surrendered control over transferred assets when: ● the assets have been isolated from the Company; ● the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred asset; and ● the Company does not maintain effective control over the transferred asset through an agreement to repurchase it before its maturity. The Company, from time to time, sells participation interests in mortgage loans it has originated or acquired. To recognize the transfer of a portion of a financial asset as a sale, the transferred portion, and any portion that the transferor continues to hold must represent a participating interest. In addition, the transfer of the participating interest must meet the conditions for surrender of control. To qualify as a participating interest: ● each portion of a financial asset must represent a proportionate ownership interest in an entire financial asset; ● from the date of transfer, all cash flows received from the entire financial asset must be divided proportionately among the participating interest holders in an amount equal to their respective share of ownership; ● the transfer must be made on a non-recourse basis (other than standard representations and warranties made under the loan participation sale agreement); ● the transfer may not be subordinate to any other participating interest holder; and ● no party has the right to pledge or exchange the entire financial asset. If the transaction does not meet either the participating interest or surrender of control criteria, management accounts for it as a secured borrowing arrangement. Under some circumstances, when the Company sells a participation in a wholly owned loan receivable that it services, it retains loan-servicing rights, and records a servicing asset that is initially measured at fair value. As quoted market prices are generally not available for these assets, the Company estimates fair value based on the present value of future expected cash flows associated with the loan receivable. The Company amortizes servicing assets over the life of the associated receivable using the interest method. Any gain or loss recognized on the sale of a loan receivable depends in part on both the previous carrying amount of the financial asset involved in the sale, allocated between the asset sold and the interest that continues to be held by the Company based on its relative fair value at the date of transfer, and the proceeds received. |
Property and Equipment | Property and Equipment The Company states its furniture, fixtures, equipment, and leasehold improvements at cost, less accumulated depreciation and amortization. Management computes depreciation on a straight-line basis over the estimated useful lives of the assets. The useful lives of the Company’s assets range from three |
Debt Issuance Costs | Debt Issuance Costs The Company’s debt consists of borrowings from financial institutions and obligations to investors incurred through the sale of debt certificates. Management presents debt net of debt issuance costs and amortizes debt issuance costs into interest expense over the contractual terms of the debt using the straight-line method. |
Employee Benefit Plans | Employee Benefit Plans The Company records contributions to the qualified employee retirement plan as compensation cost in the period incurred. The Company has also entered into a Supplemental Executive Retirement Plan (the “ SERP |
Leases | Leases We recognize right-of-use (“ROU”) assets and lease liabilities on the balance sheet for leases with lease terms longer than 12 months. The recognition, measurement and presentation of lease expenses and cash flows depend on the lease classification as a finance or operating lease. The Company has operating leases for real estate and a vehicle. Its leases have remaining lease terms of one Some leasing arrangements require variable payments that are dependent on usage or may vary for other reasons, such as payments for insurance and tax payments. The Company does not include the variable part of lease payments its ROU assets or lease liabilities. Rather, variable payments, other than those dependent upon an index or rate, are expensed when the obligation for those payments is incurred and are included in lease expenses recorded in selling and administrative expenses on the Consolidated Statements of Operations. If any of the lease agreements have both lease and non-lease components, we treat those as a single lease component for all underlying asset classes. Accordingly, we account for all expenses associated with a lease contract as lease expenses. Leases with a term of 12 months or less are not recognized on the balance sheet, but rather expensed on a straight-line basis over the lease term. |
Income Taxes | Income Taxes The Company has elected to be treated as a partnership for income tax purposes. Therefore, the Company passes through its income and expenses to its members for tax reporting purposes. Tesoro Hills, LLC, is a joint venture in which the Company has an investment. Tesoro Hills, according to its operating agreement, has elected to be treated as a partnership for income tax purposes. The Company and MP Securities are subject to a California LLC fee. The Company uses a recognition threshold and a measurement attribute for the consolidated financial statement recognition and measurement of a tax position taken in a tax return. The Company recognizes benefits from tax positions in the consolidated financial statements only when it is more likely than not that the tax position will be sustained upon examination by the appropriate taxing authority that would have full knowledge of all relevant information. A tax position that meets the more-likely-than-not recognition threshold is measured at the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate settlement. Tax positions that previously failed to meet the more-likely-than-not recognition threshold are recognized in the first subsequent financial reporting period in which that threshold is met. Management derecognizes previously recognized tax positions that no longer meet the more-likely-than-not recognition threshold in the first subsequent financial reporting period in which that threshold is no longer met. |
Related Party Transaction Policy | Related Party Transaction Policy The Board has adopted a Related Party Transaction Policy to assist in evaluating transactions the Company may enter into with a related party. Under this policy, a majority of the members of the Company’s Board and majority of its independent Board members must approve a material transaction that it enters into with a related party. As a result, all transactions that the Company undertakes with an affiliate, or a related party are entered into on terms believed by management to be no less favorable than are available from unaffiliated third parties. In addition, a majority of the Company’s independent Board members must approve these transactions. |
Pledged Cash and Restricted C_2
Pledged Cash and Restricted Cash (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Cash and Cash Equivalents [Abstract] | |
Schedule of reconciliation of cash, cash equivalents, and restricted cash | The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the statement of financial position to the amounts reported in the statements of cash flows (dollars in thousands): March 31, December 31, 2024 2023 2023 Cash and cash equivalents $ 11,193 $ 17,057 $ 10,854 Restricted cash 1,760 58 1,757 Total cash, cash equivalents, and restricted cash shown in the statement of cash flows $ 12,953 $ 17,115 $ 12,611 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
AdelFi | |
Related Party Transaction [Line Items] | |
Summary of Related Party Balances | Related party balances pertaining to the assets of the Company (dollars in thousands): March 31, December 31, 2024 2023 Total funds held on deposit at AdelFi $ 3,135 $ 3,457 Loan participations purchased from and serviced by AdelFi 1,284 1,298 |
Schedule of Related Party Transactions | Related party transactions of the Company (dollars in thousands): Three months ended March 31, 2024 2023 Interest earned on funds held with AdelFi $ 39 $ — Interest income earned on loans purchased from AdelFi 21 1 Fees paid to AdelFi from MP Securities Networking Agreement 3 2 |
ACCU | |
Related Party Transaction [Line Items] | |
Summary of Related Party Balances | Related party balances pertaining to the assets of the Company (dollars in thousands): March 31, December 31, 2024 2023 Total funds held on deposit at ACCU $ 82 $ 164 Dollar amount of outstanding loan participations sold to ACCU and serviced by the Company 935 941 Amount owed on ACCU secured borrowings 7 7 Amount owed on ACCU line of credit 3,000 4,500 Loans pledged on ACCU line of credit 7,121 7,167 |
Schedule of Related Party Transactions | Related party transactions of the Company (dollars in thousands): Three months ended March 31, 2024 2023 Interest earned on funds held with ACCU $ — $ 1 Dollar amount of net draws (payments) made on ACCU line of credit (1,500) — Interest expense on ACCU borrowings 70 20 Income from broker services provided to ACCU by MPS 8 9 Fees paid based on MP Securities Networking Agreement with ACCU 24 36 |
KCT Credit Union | |
Related Party Transaction [Line Items] | |
Summary of Related Party Balances | Related party balances pertaining to the assets of the Company (dollars in thousands): March 31, December 31, 2024 2023 Total funds held on deposit at KCT $ 3,251 $ 1,308 Amount owed on KCT line of credit 4,500 — Loans pledged on KCT lines of credit 11,932 10,962 Certificates of deposit pledged on KCT Warehouse LOC 1,250 1,250 Outstanding loan participations sold to KCT and serviced by the Company 3,365 3,455 |
Schedule of Related Party Transactions | Related party transactions of the Company (dollars in thousands): Three months ended March 31, 2024 2023 Interest earned on funds held with KCT $ 8 $ 10 Dollar amount of draws on KCT line of credit 4,500 — Interest expense on KCT line of credit 13 — Fees paid based on MP Securities Networking Agreement with KCT 5 8 |
Other Related Parties [Member] | |
Related Party Transaction [Line Items] | |
Summary of Related Party Balances | Related party balances pertaining to the assets of the Company (dollars in thousands): March 31, December 31, 2024 2023 Outstanding loan participations sold to NFCU and serviced by the Company $ 4,712 $ 4,745 Outstanding notes payable to officers and managers 2,781 2,871 |
Loans Receivable and Allowanc_2
Loans Receivable and Allowance for Expected Credit Losses (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Receivables [Abstract] | |
Summary of Loans | March 31, December 31, 2024 2023 Non-profit commercial loans: Real estate secured $ 88,799 $ 87,524 Unsecured 68 74 Total non-profit commercial loans: 88,867 87,598 For-profit commercial loans: Real estate secured 12,787 12,783 Total loans 101,654 100,381 Deferred loan fees, net (139) (139) Loan discount (165) (168) Allowance for expected credit losses (1,449) (1,501) Loans, net $ 99,901 $ 98,573 |
Schedule of Changes in Allowance for Loan Losses | Three months ended March 31, 2024 Segment: Non-profit Commercial For-profit Commercial Total Balance, beginning of period $ 1,471 $ 30 $ 1,501 Provision (credit) for expected credit loss (53) 1 (52) Charge-offs — — — Recoveries — — — Balance, end of period $ 1,418 $ 31 $ 1,449 Year ended December 31, 2023 Segment: Non-profit Commercial For-profit Commercial Total Balance, beginning of period $ 1,530 $ 21 $ 1,551 Adjustment related to implementation of CECL model 129 (16) 113 Provision (credit) for expected credit loss (167) 25 (142) Charge-offs (21) — (21) Recoveries — — — Balance, end of period $ 1,471 $ 30 $ 1,501 |
Schedule of Loans and Allowance for Loan Losses by Impairment Methodology | Loans and Allowance for Expected Credit Losses (by segment) As of March 31, 2024 December 31, 2023 Non-profit Commercial Loans: Individually evaluated for impairment $ 16,767 $ 16,792 Collectively evaluated for impairment 72,100 70,806 Total Non-profit Commercial Loans 88,867 87,598 For-profit Commercial Loans: Individually evaluated for impairment — — Collectively evaluated for impairment 12,787 12,783 Total For-profit Commercial Loans 12,787 12,783 Balance $ 101,654 $ 100,381 Allowance for expected credit losses: Non-profit Commercial Loans: Individually evaluated for impairment $ 675 $ 669 Collectively evaluated for impairment 743 802 Total Non-profit Commercial Loan Allowance 1,418 1,471 For-profit Commercial Loans: Individually evaluated for impairment — — Collectively evaluated for impairment 31 30 Total For-profit Commercial Loan Allowance 31 30 Balance $ 1,449 $ 1,501 |
Schedule of Loan Portfolio Credit Quality Indicators by Class | Credit Quality Indicators (by class) As of March 31, 2024 Pass Watch Special Mention Substandard Doubtful Loss Total Non-profit Commercial Loans Wholly Owned First Amortizing $ 46,589 $ 22,675 $ 5,408 $ 9,881 $ — $ — $ 84,553 Wholly Owned Other Amortizing 1,393 — — 1,478 — — 2,871 Wholly Owned Unsecured Amortizing 24 28 — — — — 52 Wholly Owned Unsecured LOC 40 — — — — — 40 Participation First 1,284 — — — — — 1,284 Total Non-profit Commercial Loans 49,397 22,703 5,408 11,359 — — 88,867 For-profit Commercial Loans — Wholly Owned First Amortizing 6,771 2,800 — — — — 9,571 Participation First 1,641 132 — — — — 1,773 Participation Construction 1,443 — — — — — 1,443 Total For-profit Commercial Loans 9,855 2,932 — — — — 12,787 Total Loans $ 59,252 $ 25,635 $ 5,408 $ 11,359 $ — $ — $ 101,654 Credit Quality Indicators (by class) As of December 31, 2023 Pass Watch Special Mention Substandard Doubtful Loss Total Non-profit Commercial Loans Wholly Owned First Amortizing $ 35,106 $ 32,891 $ 5,408 $ 9,882 $ — $ — $ 83,287 Wholly Owned Other Amortizing 1,405 — — 1,502 — — 2,907 Wholly Owned Unsecured Amortizing 25 28 — — — — 53 Wholly Owned Unsecured LOC 46 — — — — — 46 Wholly Owned Construction 7 — — — — — 7 Participation First 1,298 — — — — — 1,298 Total Non-profit Commercial Loans 37,887 32,919 5,408 11,384 — — 87,598 For-profit Commercial Loans Participation First 1,776 — — — — — 1,776 Participation Construction 1,433 — — — — — 1,433 Total For-profit Commercial Loans 12,783 — — — — — 12,783 Total Loans $ 50,670 $ 32,919 $ 5,408 $ 11,384 $ — $ — $ 100,381 |
Schedule of Age Analysis of Past Due Loans by Class | Age Analysis of Past Due Loans (by class) As of March 31, 2024 30-59 Days Past Due 60-89 Days Past Due Greater Than 90 Days Total Past Due Current Total Loans Recorded Investment 90 Days or More and Still Accruing Non-profit Commercial Loans Wholly Owned First Amortizing $ 1,002 $ 6,749 $ 1,831 $ 9,582 $ 74,971 $ 84,553 $ — Wholly Owned Other Amortizing — — — — 2,871 2,871 — Wholly Owned Unsecured Amortizing — — — — 52 52 — Wholly Owned Unsecured LOC — — — — 40 40 — Participation First — — — — 1,284 1,284 — Total Non-profit Commercial Loans 1,002 6,749 1,831 9,582 79,285 88,867 — For-profit Commercial Loans Wholly Owned First Amortizing — — — — 9,571 9,571 — Participation First 344 — — 344 1,429 1,773 — Participation Construction — — — — 1,443 1,443 — Total For-profit Commercial Loans 344 — — 344 12,443 12,787 — Total Loans $ 1,346 $ 6,749 $ 1,831 $ 9,926 $ 91,728 $ 101,654 $ — Age Analysis of Past Due Loans (by class) As of December 31, 2023 30-59 Days Past Due 60-89 Days Past Due Greater Than 90 Days Total Past Due Current Total Loans Recorded Investment 90 Days or More and Still Accruing Non-profit Commercial Loans Wholly Owned First Amortizing $ 7,020 $ 143 $ 875 $ 8,038 $ 75,249 $ 83,287 $ — Wholly Owned Other Amortizing — — — — 2,907 2,907 — Wholly Owned Unsecured Amortizing — — — — 53 53 — Wholly Owned Unsecured LOC — — — — 46 46 — Wholly Owned Construction — — — — 7 7 — Participation First — — — — 1,298 1,298 — Total Non-profit Commercial Loans 7,020 143 875 8,038 79,560 87,598 — For-profit Commercial Loans Participation First — — — — 1,776 1,776 — Participation Construction — — — — 1,433 1,433 — Total For-profit Commercial Loans — — — — 12,783 12,783 — Total Loans $ 7,020 $ 143 $ 875 $ 8,038 $ 92,343 $ 100,381 $ — |
Schedule of Impaired Loans by Class | As of As of March 31, December 31, Impaired Non-profit commercial Loans (by class) 2024 2023 Wholly Owned First Amortizing Recorded investment with specific allowance $ 8,241 $ 8,238 Recorded with no specific allowance 13,838 15,166 Total recorded investment $ 22,079 $ 23,404 Unpaid principal balance $ 22,539 $ 23,870 Wholly Owned Other Amortizing Recorded investment with specific allowance $ 1,478 $ 1,502 Recorded with no specific allowance — — Total recorded investment $ 1,478 $ 1,502 Unpaid principal balance $ 1,685 $ 1,685 Total Impaired Loans Recorded investment with specific allowance $ 9,719 $ 9,740 Recorded with no specific allowance 13,838 15,166 Total recorded investment $ 23,557 $ 24,906 Unpaid principal balance $ 24,224 $ 25,555 For the three months ended March 31, March 31, Impaired Non-profit Commercial Loans (by class) 2024 2023 Wholly Owned First Amortizing Average recorded investment $ 22,845 $ 25,132 Interest income recognized 317 303 Wholly Owned Other Amortizing Average recorded investment 1,490 1,579 Interest income recognized — — Total Impaired Loans Average recorded investment $ 24,335 $ 26,711 Interest income recognized 317 303 |
Schedule of Loans on Non-accrual Status by Class | Loans on Nonaccrual Status (by class) as of March 31, 2024 December 31, 2023 Non-profit Commercial Loans: Wholly Owned First Amortizing $ 9,881 $ 9,882 Wholly Owned Other Amortizing 1,478 1,502 Total $ 11,359 $ 11,384 |
Investments (Tables)
Investments (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Details of certificates with original maturities of greater than three months owned | Details of certificates with original maturities of greater than three months owned by the Company as of March 31, 2024, are as follows (dollars in thousands): As of March 31, 2024 Certificate Open Date Certificate Amount Interest Rate Maturity Date CD 1 3/15/2024 $ 1,251 2.25% 3/15/2025 |
Indexed annuity insurance contracts | Additional information related to these investments is as follows (dollars in thousands): Income for the three months ended Investment Type Maturity Date Original Cost Net Carrying Amount March 31, 2024 March 31, 2023 Fixed annuity June 2032 $ 1,000 $ 1,053 $ 1 $ 1 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregated Revenue | Three months ended March 31, 2024 2023 Non-interest income, in scope of ASC 606 Broker-dealer fees and commissions $ 175 $ 215 Gains on loan sales — 7 Other investment income 1 1 Other non-interest income — 5 Non-interest income, out of scope, ASC 606 Lending fees 35 50 Charitable contributions, with donor restrictions — 400 Total non-interest income $ 211 $ 678 |
Schedule of Revenue by Transaction and Assets Under Management | For the three months ended (dollars in thousands) March 31, 2024 March 31, 2023 Broker-dealer revenue Securities commissions Transactional $ 39 $ 15 AUM 15 12 54 27 Sale of investment company products Transactional 2 3 AUM 22 17 24 20 Other insurance product revenue Transactional — 78 AUM 11 12 11 90 Advisory fee income Transactional — — AUM 86 78 86 78 Total broker-dealer revenue Transactional 41 96 AUM 134 119 $ 175 $ 215 |
Loan Sales (Tables)
Loan Sales (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Transfers and Servicing of Financial Assets [Abstract] | |
Schedule of summary of loan participation sales and servicing assets | A summary of loan participation sales and servicing assets are as follows (dollars in thousands): As of and for the Three months ended Year ended March 31, December 31, 2024 2023 2023 Loan participation interests sold by the Company $ — $ 7 $ 502 Total participation interests sold and serviced by the Company 31,200 34,006 31,466 Servicing income 32 37 134 Servicing Assets Balance, beginning of period $ 98 $ 123 $ 123 Additions: Servicing obligations from sale of loan participations — 9 18 Subtractions: Amortization (10) (10) (43) Balance, end of period $ 88 $ 122 $ 98 |
Foreclosed Assets (Tables)
Foreclosed Assets (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Repossessed Assets [Abstract] | |
Schedule of expenses applicable to foreclosed assets | Expenses applicable to foreclosed assets include the following (dollars in thousands): For the three months ended March 31, Foreclosed Asset Expenses 2024 2023 Provision for losses $ — $ — Operating expenses 10 4 Total foreclosed asset expenses $ 10 $ 4 |
Premises and Equipment (Tables)
Premises and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Property, Plant and Equipment [Abstract] | |
Schedule of summary of premises and equipment | The table below summarizes our premises and equipment (dollars in thousands): As of March 31, December 31, 2024 2023 Furniture and office equipment $ 449 $ 440 Computer system 226 221 Leasehold improvements 43 43 Total premises and equipment 718 704 Less accumulated depreciation and amortization (623) (648) Premises and equipment, net $ 95 $ 56 For the three months ended March 31, March 31, 2024 2023 Depreciation and amortization expense $ 17 $ 11 |
Credit Facilities and Other D_2
Credit Facilities and Other Debt (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Debt Disclosure [Abstract] | |
Summary of Principal Terms of Term Debt | Nature of Borrowing Interest Rate Interest Rate Type Amount Outstanding Amount Available to Borrow Maturity Date Amount of Loan Collateral Pledged Other Assets Pledged* KCT Warehouse LOC 9.00% Variable $ — $ 5,000 6/6/2024 $ 6,940 $ 1,250 KCT Operating LOC 9.00% Variable 4,500 500 6/6/2024 4,993 — ACCU LOC 9.25% Variable 3,000 2,000 9/23/2024 7,121 — ACCU Secured Various Fixed 7 — Various — 7 *Represents cash or certificates of deposit |
Debt Certificates Payable (Tabl
Debt Certificates Payable (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Debt Instrument [Line Items] | |
Schedule of Investor debt securities Payable | As of As of March 31, 2024 December 31, 2023 SEC Registered Public Offerings Offering Type Amount Weighted Average Interest Rate Amount Weighted Average Interest Rate Class 1A Offering Unsecured $ 10,142 4.04 % $ 12,555 4.19 % 2021 Class A Offering Unsecured 66,240 4.96 % 69,421 4.95 % 2024 Class A Offering Unsecured 4,799 5.01 % — — % Public Offering Total $ 81,181 4.55 % $ 81,976 4.83 % Private Offerings Offering Type Subordinated Notes Unsecured $ 14,539 4.83 % $ 15,055 4.76 % Private Offering Total $ 14,539 4.83 % $ 15,055 4.76 % Total Debt Certificates Payable $ 95,720 4.60 % $ 97,031 4.82 % |
Notes Payable [Member] | |
Debt Instrument [Line Items] | |
Schedule of Maturities of debt securities | 2025 $ 46,638 2026 22,958 2027 18,359 2028 3,860 2029 3,905 Total $ 95,720 Debt issuance costs 130 Debt certificates payable, net of debt issuance costs $ 95,590 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Commitments and Contingencies [Abstract] | |
Unfunded Commitments | The table below shows the outstanding financial instruments whose contract amounts represent credit risk (dollars in thousands): Contract Amount at: March 31, 2024 December 31, 2023 Undisbursed loans $ 478 $ 221 Standby letter of credit 2,000 — |
Credit losses on off-balance sheet | The following table details activity in the allowance for credit losses on off-balance sheet commitments (dollars in thousands): Three months ended Year ended March 31, 2024 December 31, 2023 Balance, beginning of period $ 2 $ — Adjustment related to implementation of CECL model — 1 Provision for losses on unfunded commitments — 1 Balance, end of period $ 2 $ 2 |
Information About Existing Operating Leases | For the Three months ended Year ended March 31, December 31, 2024 2023 2023 Lease cost Operating lease cost $ 45 $ 44 $ 176 Other information Cash paid for operating leases 13 51 190 Right-of-use assets obtained in exchange for operating lease liabilities 387 — — Lease liabilities recorded 387 — — Weighted average remaining lease term (in years) 4.80 1.27 1.24 Weighted-average discount rate 4.60 % 4.28 % 3.64 % |
Future Minimum Lease Payments and Lease Costs | Lease Payments Lease Costs 2025 $ 89 $ 117 2026 87 84 2027 87 82 2028 89 82 2029 92 82 Thereafter 31 27 Total $ 475 $ 474 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Fair Value Disclosures [Abstract] | |
Schedule of Carrying Amounts and Estimated Fair Values of Financial Instruments | The following tables show the carrying amounts and estimated fair values of the Company’s financial instruments (dollars in thousands): Fair Value Measurements at March 31, 2024 using Carrying Value Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Fair Value FINANCIAL ASSETS: Cash and restricted cash $ 12,953 $ 12,953 $ — $ — $ 12,953 Certificates of deposit 1,251 — 1,251 — 1,251 Loans, net 99,901 — — 97,407 97,407 Investment in joint venture 870 — — 870 870 Other investments 1,053 — — 1,053 1,053 Accrued interest receivable 464 — — 464 464 Servicing assets 88 — — 88 88 FINANCIAL LIABILITIES: Lines of credit $ 7,500 $ — $ — $ 7,500 $ 7,500 Other secured borrowings 7 — — 7 7 Debt certificates payable 95,590 — — 95,624 95,624 Other financial liabilities 514 — — 514 514 Fair Value Measurements at December 31, 2023 using Carrying Value Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Fair Value FINANCIAL ASSETS: Cash and restricted cash $ 12,611 $ 12,611 $ — $ — $ 12,611 Certificates of deposit 1,279 — 1,275 — 1,275 Loans, net 98,573 — — 95,913 95,913 Investments in joint venture 871 — — 871 871 Other investments 1,052 — — 1,052 1,052 Accrued interest receivable 432 — — 432 432 Servicing assets 98 — — 98 98 FINANCIAL LIABILITIES: Lines of credit $ 4,500 $ — $ — $ 4,501 $ 4,501 Other secured borrowings 7 — — 7 7 Debt certificates payable 96,979 — — 97,399 97,399 Other financial liabilities 531 — — 531 531 |
Schedule of Fair Value Measured on a Nonrecurring Basis | The following table presents the fair value of assets measured on a nonrecurring basis (dollars in thousands): Fair Value Measurements Using: Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Assets at March 31, 2024: Collateral-dependent impaired loans (net of allowance and discount) $ — $ — $ 2,870 $ 2,870 Investment in joint venture — — 870 870 Other investments — — 1,053 1,053 Foreclosed assets (net of allowance) — — 301 301 Total $ — $ — $ 5,094 $ 5,094 Assets at December 31, 2023: Collateral-dependent loans (net of allowance and discount) $ — $ — $ 2,896 $ 2,896 Investments in joint venture — — 871 871 Other investments — — 1,052 1,052 Foreclosed assets (net of allowance) — — 301 301 Total $ — $ — $ 5,120 $ 5,120 |
Schedule of Valuation Methodologies Used to Measure the Fair Value Adjustments for Level 3 Assets Recorded at Fair Value on a Nonrecurring Basis | The table below summarizes the valuation methodologies used to measure the fair value adjustments for Level 3 assets recorded at fair value on a nonrecurring basis (dollars in thousands): March 31, 2024 Assets Fair Value (in thousands) Valuation Techniques Unobservable Input Range (Weighted Average) Impaired Loans $ 2,870 Discounted appraised value Selling cost / Estimated market decrease 10% (10%) Investment in joint venture 870 Internal evaluations Estimated future market value 0% (0%) Other investments 1,053 Internal evaluations Indications of non-performance by insurance companies 0% (0%) Foreclosed Assets 301 Internal evaluations Selling cost 6% (6%) December 31, 2023 Assets Fair Value (in thousands) Valuation Techniques Unobservable Input Range (Weighted Average) Impaired loans $ 2,896 Discounted appraised value Selling cost / Estimated market decrease 10% (10%) Investments in joint venture 871 Internal evaluations Estimated future market value 0% (0%) Other investments 1,052 Internal evaluations Indications of non-performance by insurance companies 0% (0%) Foreclosed assets 301 Internal evaluations Selling cost 6% (6%) |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Segment Reporting [Abstract] | |
Schedule of Financial Information by Reportable Segments | Three months ended March 31, 2024 March 31, 2023 Revenue from external sources Finance Company* $ 1,774 $ 1,416 Broker-Dealer 300 247 Charitable Organization 20 400 Adjustments / Eliminations (72) — Total $ 2,022 $ 2,063 Revenue from internal sources Finance Company $ — $ — Broker-Dealer 159 461 Charitable Organization — — Adjustments / Eliminations (159) (461) Total $ — $ — Interest expense Finance Company $ 1,609 $ 1,252 Broker-Dealer — — Charitable Organization — — Adjustments / Eliminations (344) (334) Total $ 1,265 $ 918 Total non-interest expense and provision for tax Finance Company $ 750 $ 961 Broker-Dealer 407 414 Charitable Organization 31 — Adjustments / Eliminations (30) — Total $ 1,158 $ 1,375 Net profit (loss) Finance Company $ (533) $ (636) Broker-Dealer 50 295 Charitable Organization (10) 400 Adjustments / Eliminations 144 (127) Total $ (349) $ (68) March 31, December 31, 2024 2023 (Unaudited) (Audited) Total assets Finance Company $ 110,859 $ 109,724 Broker-Dealer 5,020 4,977 Charitable Organization 2,097 2,108 Other Segments 57 56 Adjustments / Eliminations (86) (218) Total $ 117,947 $ 116,647 |
Not-for-profit Subsidiary Act_2
Not-for-profit Subsidiary Activities (Tables) - MPC | 3 Months Ended |
Mar. 31, 2024 | |
Not-for-profit Disclosures | |
Schedule of breakdown of expenses | Three months ended March 31, 2024 March 31, 2023 Expenses Charitable grants $ 30 $ — General and administrative expenses 1 — Total $ 31 $ — |
Schedule of change in net assets | Three months ended March 31, 2024 March 31, 2023 Change in net assets $ (10) $ 400 |
Nature of Business and Summar_3
Nature of Business and Summary of Significant Accounting Policies - Narrative (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 item | Mar. 31, 2024 USD ($) item segment | Mar. 31, 2023 USD ($) | Dec. 31, 2023 USD ($) | Mar. 15, 2024 | |
Significant Accounting Policies [Line Items] | |||||
Investment, Type [Extensible Enumeration] | us-gaap:CertificatesOfDepositMember | ||||
Number of fixed annuities purchased | item | 2 | ||||
Term of fixed annuities insurance | 10 years | ||||
Number of loan portfolio segments | segment | 2 | ||||
Types of revenue, number | item | 2 | ||||
Charitable contributions, with donor restrictions | $ | $ 400 | $ 1,700 | |||
Minimum | |||||
Significant Accounting Policies [Line Items] | |||||
Estimated useful lives of property and equipment | 3 years | ||||
Operating lease, remaining lease term | 1 year | ||||
Maximum | |||||
Significant Accounting Policies [Line Items] | |||||
Investments in certificates of deposit | $ | $ 1,300 | $ 1,300 | |||
Estimated useful lives of property and equipment | 7 years | ||||
Operating lease, remaining lease term | 3 years |
Pledged Cash and Restricted C_3
Pledged Cash and Restricted Cash - Narrative (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 | Mar. 31, 2023 |
Restricted Cash and Cash Equivalents Items [Line Items] | |||
Restricted cash | $ 1,760 | $ 1,757 | $ 58 |
Secured Borrowings | |||
Restricted Cash and Cash Equivalents Items [Line Items] | |||
Amount of Collateral Pledged | 7 | $ 7 | |
MPC | |||
Restricted Cash and Cash Equivalents Items [Line Items] | |||
Restricted cash | $ 1,700 |
Pledged Cash and Restricted C_4
Pledged Cash and Restricted Cash - Reconciliation of Cash, Cash Equivalents, and Restricted Cash (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 | Mar. 31, 2023 | Dec. 31, 2022 |
Cash and Cash Equivalents [Abstract] | ||||
Cash and cash equivalents | $ 11,193 | $ 10,854 | $ 17,057 | |
Restricted cash | 1,760 | 1,757 | 58 | |
Total cash, cash equivalents, and restricted cash shown in the statements of cash flows | $ 12,953 | $ 12,611 | $ 17,115 | $ 9,564 |
Related Party Transactions - Na
Related Party Transactions - Narrative (Details) | 3 Months Ended | 12 Months Ended | ||||||
Jun. 06, 2022 USD ($) | Aug. 09, 2021 | Mar. 20, 2020 USD ($) loan | Mar. 31, 2024 USD ($) | Mar. 31, 2023 USD ($) | Dec. 31, 2023 USD ($) | Mar. 15, 2024 USD ($) | Sep. 23, 2021 USD ($) | |
Related Party Transaction [Line Items] | ||||||||
Debt facilities | $ 95,720,000 | $ 97,031,000 | ||||||
Interest rate | 2.25% | |||||||
Investment, Type [Extensible Enumeration] | us-gaap:CertificatesOfDepositMember | |||||||
Successor Servicing Agreement | ||||||||
Related Party Transaction [Line Items] | ||||||||
Collateralization ratio | 1 | |||||||
ACCU | Master LP Agreement | ||||||||
Related Party Transaction [Line Items] | ||||||||
Loans sold to related party | $ 7,000 | $ 7,000 | 7,000 | |||||
MP Securities | Networking Agreement | ||||||||
Related Party Transaction [Line Items] | ||||||||
Minimum cancellation notice | 30 days | |||||||
NFCU | ||||||||
Related Party Transaction [Line Items] | ||||||||
Number of loans sold to related party | loan | 1 | |||||||
Loans sold to related party | $ 5,000,000 | |||||||
KCT Credit Union | ||||||||
Related Party Transaction [Line Items] | ||||||||
Interest rate | 2.25% | |||||||
Investments in certificates of deposit | $ 1,300,000 | |||||||
Maturity Date | Mar. 15, 2025 | |||||||
Loan and Security Agreement terminated | $ 7,000,000 | |||||||
Serviced loan participations sold | $ 3,400,000 | 3,500,000 | ||||||
Board and Executive Management | ||||||||
Related Party Transaction [Line Items] | ||||||||
Debt certificates | $ 2,800,000 | 2,900,000 | ||||||
Minimum | MP Securities | ||||||||
Related Party Transaction [Line Items] | ||||||||
Related party servicing fee | 0.25% | |||||||
Maximum | ||||||||
Related Party Transaction [Line Items] | ||||||||
Investments in certificates of deposit | $ 1,300,000 | 1,300,000 | ||||||
Maximum | MP Securities | ||||||||
Related Party Transaction [Line Items] | ||||||||
Related party servicing fee | 5.50% | |||||||
MP Securities | ACCU | Networking Agreement | ||||||||
Related Party Transaction [Line Items] | ||||||||
Notice period for termination of agreement | 30 days | |||||||
ACCU Line of Credit. 9.00% maturing September 23, 2024 | ||||||||
Related Party Transaction [Line Items] | ||||||||
Maximum borrowing capacity | $ 5,000,000 | |||||||
Minimum cancellation notice | 90 days | |||||||
Interest rate | 9.25% | |||||||
ACCU Line of Credit. 9.00% maturing September 23, 2024 | Minimum | ||||||||
Related Party Transaction [Line Items] | ||||||||
Interest rate | 4% | |||||||
KCT Warehouse LOC [Member] | ||||||||
Related Party Transaction [Line Items] | ||||||||
Maximum borrowing capacity | 5,000,000 | |||||||
KCT Warehouse LOC [Member] | KCT Credit Union | ||||||||
Related Party Transaction [Line Items] | ||||||||
Debt facilities | $ 0 | 0 | ||||||
Maximum borrowing capacity | 5,000,000 | |||||||
Interest rate | 9% | |||||||
KCT Operating LOC [Member] | ||||||||
Related Party Transaction [Line Items] | ||||||||
Debt facilities | $ 4,500,000 | |||||||
Maximum borrowing capacity | 5,000,000 | |||||||
KCT Operating LOC [Member] | KCT Credit Union | ||||||||
Related Party Transaction [Line Items] | ||||||||
Debt facilities | $ 4,500,000 | 0 | ||||||
Maximum borrowing capacity | $ 5,000,000 | |||||||
Interest rate | 9% | |||||||
ACCU Line of Credit. 9.00% maturing September 23, 2024 | ||||||||
Related Party Transaction [Line Items] | ||||||||
Debt facilities | $ 3,000,000 | $ 4,500,000 | ||||||
ACCU Line of Credit. 9.00% maturing September 23, 2024 | ACCU | ||||||||
Related Party Transaction [Line Items] | ||||||||
Maximum borrowing capacity | $ 5,000,000 | |||||||
Maturity Date | Sep. 23, 2024 |
Related Party Transactions - Su
Related Party Transactions - Summary of Related Party Balances (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Related Party Transaction [Line Items] | ||
Amount owed to related party | $ 1,896 | $ 1,683 |
AdelFi | ||
Related Party Transaction [Line Items] | ||
Total funds held on deposit | 3,135 | 3,457 |
Loan participations purchased from and serviced by related party | 1,284 | 1,298 |
ACCU | ||
Related Party Transaction [Line Items] | ||
Total funds held on deposit | 82 | 164 |
Outstanding loan participations sold to related party and serviced by the Company | 935 | 941 |
ACCU | Line Of Credit [Member] | ||
Related Party Transaction [Line Items] | ||
Amount owed to related party | 3,000 | 4,500 |
Loans pledged on line of credit | $ 7,121 | $ 7,167 |
Financial Instrument, Owned, Pledging Purpose [Extensible Enumeration] | Lines of credit | Lines of credit |
ACCU | Secured Borrowings [Member] | ||
Related Party Transaction [Line Items] | ||
Amount owed to related party | $ 7 | $ 7 |
KCT Credit Union | ||
Related Party Transaction [Line Items] | ||
Total funds held on deposit | 3,251 | 1,308 |
Amount owed to related party | 4,500 | |
Loans pledged on line of credit | $ 11,932 | $ 10,962 |
Financial Instrument, Owned, Pledging Purpose [Extensible Enumeration] | Lines of credit | Lines of credit |
Certificates of deposit pledged on KCT Warehouse LOC | $ 1,250 | $ 1,250 |
Outstanding loan participations sold to related party and serviced by the Company | 3,365 | 3,455 |
NFCU | ||
Related Party Transaction [Line Items] | ||
Outstanding loan participations sold to related party and serviced by the Company | 4,712 | 4,745 |
Officers And Managers [Member] | ||
Related Party Transaction [Line Items] | ||
Debt certificates payable | $ 2,781 | $ 2,871 |
Related Party Transactions - Sc
Related Party Transactions - Schedule of Related Party Transactions (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Related Party Transaction [Line Items] | ||
Interest expensed on line of credit | $ 1,265 | $ 918 |
Income from related parties | 211 | 678 |
AdelFi Credit Union [Member] | ||
Related Party Transaction [Line Items] | ||
Interest earned on funds held with related party | 39 | |
Interest income earned on loans purchased from related party | 21 | 1 |
AdelFi Credit Union [Member] | Networking Agreement | ||
Related Party Transaction [Line Items] | ||
Operating Costs and Expenses | 3 | 2 |
ACCU | ||
Related Party Transaction [Line Items] | ||
Interest earned on funds held with related party | 1 | |
Dollar amount of draws taken on line of credit | (1,500) | |
Interest expensed on line of credit | 70 | 20 |
ACCU | MP Securities | ||
Related Party Transaction [Line Items] | ||
Income from related parties | 8 | 9 |
ACCU | Networking Agreement | MP Securities | ||
Related Party Transaction [Line Items] | ||
Operating Costs and Expenses | 24 | 36 |
KCT Credit Union | ||
Related Party Transaction [Line Items] | ||
Interest earned on funds held with related party | 8 | 10 |
Dollar amount of draws taken on line of credit | 4,500 | |
Interest expensed on line of credit | 13 | |
KCT Credit Union | MP Securities | ||
Related Party Transaction [Line Items] | ||
Operating Costs and Expenses | $ 5 | $ 8 |
Loans Receivable and Allowanc_3
Loans Receivable and Allowance for Expected Credit Losses - Narrative (Details) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2024 USD ($) loan segment item | Mar. 31, 2023 USD ($) | Dec. 31, 2023 loan | |
Loans and Leases Receivable Disclosure [Line Items] | |||
Number of loan portfolio segments | segment | 2 | ||
Number of loan categories | item | 8 | ||
Loan interest rate | 6.68% | 6.42% | |
Modified loan amount | $ | $ 0 | $ 0 | |
Commitments to advance additional funds in connection with loan modifications | $ | $ 0 | ||
Loans modified that are past maturity, write off | loan | 1 | ||
profit Commercial Loans | |||
Loans and Leases Receivable Disclosure [Line Items] | |||
Number of modified loans | loan | 0 | 0 |
Loans Receivable and Allowanc_4
Loans Receivable and Allowance for Expected Credit Losses - Summary of Mortgage Loans (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 | Dec. 31, 2022 |
Financing Receivable, Allowance for Credit Losses [Line Items] | |||
Total loans | $ 101,654 | $ 100,381 | |
Deferred loan fees, net | (139) | (139) | |
Loan discount | (165) | (168) | |
Allowance for expected credit losses | (1,449) | (1,501) | $ (1,551) |
Loans, net | 99,901 | 98,573 | |
Non-profit Commercial Loans | |||
Financing Receivable, Allowance for Credit Losses [Line Items] | |||
Total loans | 88,867 | 87,598 | |
Allowance for expected credit losses | (1,418) | (1,471) | (1,530) |
Non-profit Commercial Loans | Real Estate Secured | |||
Financing Receivable, Allowance for Credit Losses [Line Items] | |||
Total loans | 88,799 | 87,524 | |
Non-profit Commercial Loans | Unsecured | |||
Financing Receivable, Allowance for Credit Losses [Line Items] | |||
Total loans | 68 | 74 | |
profit commercial loans | |||
Financing Receivable, Allowance for Credit Losses [Line Items] | |||
Total loans | 12,787 | 12,783 | |
Allowance for expected credit losses | (31) | (30) | $ (21) |
profit commercial loans | Real Estate Secured | |||
Financing Receivable, Allowance for Credit Losses [Line Items] | |||
Total loans | $ 12,787 | $ 12,783 |
Loans Receivable and Allowanc_5
Loans Receivable and Allowance for Expected Credit Losses - Schedule of Changes in Allowance for Loan Losses (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Financing Receivable, Allowance for Credit Losses [Line Items] | |||
Balance, beginning of period | $ 1,501 | $ 1,551 | $ 1,551 |
Provision (credit) for expected credit loss | (52) | (162) | (142) |
Charge-offs | (21) | ||
Balance, end of period | 1,449 | 1,501 | |
Non-profit Commercial Loans | |||
Financing Receivable, Allowance for Credit Losses [Line Items] | |||
Balance, beginning of period | 1,471 | 1,530 | 1,530 |
Provision (credit) for expected credit loss | (53) | (167) | |
Charge-offs | (21) | ||
Balance, end of period | 1,418 | 1,471 | |
profit Commercial Loans | |||
Financing Receivable, Allowance for Credit Losses [Line Items] | |||
Balance, beginning of period | 30 | $ 21 | 21 |
Provision (credit) for expected credit loss | 1 | 25 | |
Balance, end of period | 31 | 30 | |
Cumulative Effect, Period of Adoption, Adjustment [Member] | Accounting Standards Update 2016-13 [Member] | |||
Financing Receivable, Allowance for Credit Losses [Line Items] | |||
Balance, beginning of period | 113 | ||
Balance, end of period | 113 | ||
Cumulative Effect, Period of Adoption, Adjustment [Member] | Accounting Standards Update 2016-13 [Member] | Non-profit Commercial Loans | |||
Financing Receivable, Allowance for Credit Losses [Line Items] | |||
Balance, beginning of period | 129 | ||
Balance, end of period | 129 | ||
Cumulative Effect, Period of Adoption, Adjustment [Member] | Accounting Standards Update 2016-13 [Member] | profit Commercial Loans | |||
Financing Receivable, Allowance for Credit Losses [Line Items] | |||
Balance, beginning of period | $ (16) | ||
Balance, end of period | $ (16) |
Loans Receivable and Allowanc_6
Loans Receivable and Allowance for Expected Credit Losses - Schedule of Loans and Allowance for Loan Losses by Impairment Methodology (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 | Dec. 31, 2022 |
Financing Receivable, Allowance for Credit Losses [Line Items] | |||
Loans: Balance | $ 101,654 | $ 100,381 | |
Allowance for loan losses: Balance | 1,449 | 1,501 | $ 1,551 |
Non-profit Commercial Loans | |||
Financing Receivable, Allowance for Credit Losses [Line Items] | |||
Loans: Individually evaluated for impairment | 16,767 | 16,792 | |
Loans: Collectively evaluated for impairment | 72,100 | 70,806 | |
Loans: Balance | 88,867 | 87,598 | |
Allowance for loan losses: Individually evaluated for impairment | 675 | 669 | |
Allowance for loan losses: Collectively evaluated for impairment | 743 | 802 | |
Allowance for loan losses: Balance | 1,418 | 1,471 | 1,530 |
profit Commercial Loans | |||
Financing Receivable, Allowance for Credit Losses [Line Items] | |||
Loans: Collectively evaluated for impairment | 12,787 | 12,783 | |
Loans: Balance | 12,787 | 12,783 | |
Allowance for loan losses: Collectively evaluated for impairment | 31 | 30 | |
Allowance for loan losses: Balance | $ 31 | $ 30 | $ 21 |
Loans Receivable and Allowanc_7
Loans Receivable and Allowance for Expected Credit Losses - Schedule of Loan Portfolio Credit Quality Indicators by Class (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | $ 101,654 | $ 100,381 |
Non-profit Commercial Loans | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 88,867 | 87,598 |
Non-profit Commercial Loans | Wholly-Owned First Amortizing | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 84,553 | 83,287 |
Non-profit Commercial Loans | Wholly Owned Other Amortizing | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 2,871 | 2,907 |
Non-profit Commercial Loans | Wholly Owned Unsecured Amortizing | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 52 | 53 |
Non-profit Commercial Loans | Wholly Owned Unsecured LOC | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 40 | 46 |
Non-profit Commercial Loans | Wholly Owned Construction | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 7 | |
Non-profit Commercial Loans | Participation First | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 1,284 | 1,298 |
profit Commercial Loans | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 12,787 | 12,783 |
profit Commercial Loans | Wholly-Owned First Amortizing | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 9,571 | |
profit Commercial Loans | Participation First | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 1,773 | 1,776 |
profit Commercial Loans | Participation Construction | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 1,443 | 1,433 |
Pass | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 59,252 | 50,670 |
Pass | Non-profit Commercial Loans | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 49,397 | 37,887 |
Pass | Non-profit Commercial Loans | Wholly-Owned First Amortizing | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 46,589 | 35,106 |
Pass | Non-profit Commercial Loans | Wholly Owned Other Amortizing | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 1,393 | 1,405 |
Pass | Non-profit Commercial Loans | Wholly Owned Unsecured Amortizing | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 24 | 25 |
Pass | Non-profit Commercial Loans | Wholly Owned Unsecured LOC | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 40 | 46 |
Pass | Non-profit Commercial Loans | Wholly Owned Construction | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 7 | |
Pass | Non-profit Commercial Loans | Participation First | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 1,284 | 1,298 |
Pass | profit Commercial Loans | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 9,855 | 12,783 |
Pass | profit Commercial Loans | Wholly-Owned First Amortizing | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 6,771 | |
Pass | profit Commercial Loans | Participation First | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 1,641 | 1,776 |
Pass | profit Commercial Loans | Participation Construction | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 1,443 | 1,433 |
Watch | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 25,635 | 32,919 |
Watch | Non-profit Commercial Loans | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 22,703 | 32,919 |
Watch | Non-profit Commercial Loans | Wholly-Owned First Amortizing | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 22,675 | 32,891 |
Watch | Non-profit Commercial Loans | Wholly Owned Unsecured Amortizing | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 28 | 28 |
Watch | profit Commercial Loans | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 2,932 | |
Watch | profit Commercial Loans | Wholly-Owned First Amortizing | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 2,800 | |
Watch | profit Commercial Loans | Participation First | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 132 | |
Special Mention | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 5,408 | 5,408 |
Special Mention | Non-profit Commercial Loans | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 5,408 | 5,408 |
Special Mention | Non-profit Commercial Loans | Wholly-Owned First Amortizing | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 5,408 | 5,408 |
Substandard | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 11,359 | 11,384 |
Substandard | Non-profit Commercial Loans | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 11,359 | 11,384 |
Substandard | Non-profit Commercial Loans | Wholly-Owned First Amortizing | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | 9,881 | 9,882 |
Substandard | Non-profit Commercial Loans | Wholly Owned Other Amortizing | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total loans | $ 1,478 | $ 1,502 |
Loans Receivable and Allowanc_8
Loans Receivable and Allowance for Expected Credit Losses - Schedule of Age Analysis of Past Due Loans by Class (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | $ 101,654 | $ 100,381 |
30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 1,346 | 7,020 |
60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 6,749 | 143 |
Greater Than 90 Days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 1,831 | 875 |
Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 9,926 | 8,038 |
Current | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 91,728 | 92,343 |
Non-profit Commercial Loans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 88,867 | 87,598 |
Non-profit Commercial Loans | 30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 1,002 | 7,020 |
Non-profit Commercial Loans | 60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 6,749 | 143 |
Non-profit Commercial Loans | Greater Than 90 Days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 1,831 | 875 |
Non-profit Commercial Loans | Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 9,582 | 8,038 |
Non-profit Commercial Loans | Current | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 79,285 | 79,560 |
Non-profit Commercial Loans | Wholly-Owned First Amortizing | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 84,553 | 83,287 |
Non-profit Commercial Loans | Wholly-Owned First Amortizing | 30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 1,002 | 7,020 |
Non-profit Commercial Loans | Wholly-Owned First Amortizing | 60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 6,749 | 143 |
Non-profit Commercial Loans | Wholly-Owned First Amortizing | Greater Than 90 Days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 1,831 | 875 |
Non-profit Commercial Loans | Wholly-Owned First Amortizing | Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 9,582 | 8,038 |
Non-profit Commercial Loans | Wholly-Owned First Amortizing | Current | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 74,971 | 75,249 |
Non-profit Commercial Loans | Wholly Owned Other Amortizing | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 2,871 | 2,907 |
Non-profit Commercial Loans | Wholly Owned Other Amortizing | Current | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 2,871 | 2,907 |
Non-profit Commercial Loans | Wholly Owned Unsecured Amortizing | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 52 | 53 |
Non-profit Commercial Loans | Wholly Owned Unsecured Amortizing | Current | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 52 | 53 |
Non-profit Commercial Loans | Wholly Owned Unsecured LOC | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 40 | 46 |
Non-profit Commercial Loans | Wholly Owned Unsecured LOC | Current | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 40 | 46 |
Non-profit Commercial Loans | Wholly Owned Construction | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 7 | |
Non-profit Commercial Loans | Wholly Owned Construction | Current | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 7 | |
Non-profit Commercial Loans | Participation First | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 1,284 | 1,298 |
Non-profit Commercial Loans | Participation First | Current | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 1,284 | 1,298 |
profit Commercial Loans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 12,787 | 12,783 |
profit Commercial Loans | 30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 344 | |
profit Commercial Loans | Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 344 | |
profit Commercial Loans | Current | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 12,443 | 12,783 |
profit Commercial Loans | Wholly-Owned First Amortizing | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 9,571 | |
profit Commercial Loans | Wholly-Owned First Amortizing | Current | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 9,571 | |
profit Commercial Loans | Participation First | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 1,773 | 1,776 |
profit Commercial Loans | Participation First | 30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 344 | |
profit Commercial Loans | Participation First | Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 344 | |
profit Commercial Loans | Participation First | Current | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 1,429 | 1,776 |
profit Commercial Loans | Participation Construction | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | 1,443 | 1,433 |
profit Commercial Loans | Participation Construction | Current | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total loans | $ 1,443 | $ 1,433 |
Loans Receivable and Allowanc_9
Loans Receivable and Allowance for Expected Credit Losses - Impaired Loans by Class (Details) - Non-profit Commercial Loans - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Impaired Financing Receivable, Recorded Investment [Abstract] | |||
Recorded investment with specific allowance | $ 9,719 | $ 9,740 | |
Recorded with no specific allowance | 13,838 | 15,166 | |
Total Recorded Investment | 23,557 | 24,906 | |
Unpaid Principal Balance | 24,224 | 25,555 | |
Impaired Financing Receivable, Average Recorded Investment [Abstract] | |||
Average Recorded Investment | 24,335 | $ 26,711 | |
Impaired Financing Receivable, Interest Income, Cash Basis Method [Abstract] | |||
Interest Income Recognized | 317 | 303 | |
Wholly-Owned First Amortizing | |||
Impaired Financing Receivable, Recorded Investment [Abstract] | |||
Recorded investment with specific allowance | 8,241 | 8,238 | |
Recorded with no specific allowance | 13,838 | 15,166 | |
Total Recorded Investment | 22,079 | 23,404 | |
Unpaid Principal Balance | 22,539 | 23,870 | |
Impaired Financing Receivable, Average Recorded Investment [Abstract] | |||
Average Recorded Investment | 22,845 | 25,132 | |
Impaired Financing Receivable, Interest Income, Cash Basis Method [Abstract] | |||
Interest Income Recognized | 317 | 303 | |
Wholly Owned Other Amortizing | |||
Impaired Financing Receivable, Recorded Investment [Abstract] | |||
Recorded investment with specific allowance | 1,478 | 1,502 | |
Total Recorded Investment | 1,478 | 1,502 | |
Unpaid Principal Balance | 1,685 | $ 1,685 | |
Impaired Financing Receivable, Average Recorded Investment [Abstract] | |||
Average Recorded Investment | $ 1,490 | $ 1,579 |
Loans Receivable and Allowan_10
Loans Receivable and Allowance for Expected Credit Losses - Schedule of Loans on Non-accrual Status by Class (Details) - Non-profit Commercial Loans - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Nonaccrual loans | $ 11,359 | $ 11,384 |
Wholly-Owned First Amortizing | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Nonaccrual loans | 9,881 | 9,882 |
Wholly Owned Other Amortizing | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Nonaccrual loans | $ 1,478 | $ 1,502 |
Investments - Narrative (Detail
Investments - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2024 | Dec. 31, 2023 | Dec. 31, 2015 | |
Schedule of Equity Method Investments [Line Items] | |||
Investment in joint venture | $ 870 | $ 871 | $ 900 |
Respective contributions balance reduced to zero | |||
Schedule of Equity Method Investments [Line Items] | |||
Percentage of profit entitled | 30% | ||
Tesoro Hills | Ministry Partners Investment Company | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership percentage held | 73% | 74% | 100% |
Investments - Certificates of D
Investments - Certificates of Deposit (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Mar. 15, 2024 |
Equity Method Investments and Joint Ventures [Abstract] | ||
Investment, Type [Extensible Enumeration] | us-gaap:CertificatesOfDepositMember | |
Interest-Bearing Domestic Deposit, Certificates of Deposits | $ 1,251 | |
Interest rate | 2.25% |
Investments - Other Investments
Investments - Other Investments (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | |
Jun. 30, 2022 USD ($) contract | Mar. 31, 2024 USD ($) | Mar. 31, 2023 USD ($) | |
Equity Method Investments and Joint Ventures [Abstract] | |||
Number of indexed annuity contracts contracts | contract | 2 | ||
Contracted period | 10 years | ||
Original Cost | $ 1,000 | ||
Net Carrying Amount | $ 1,053 | ||
Investment income recognized | $ 1 | $ 1 |
Revenue Recognition - Schedule
Revenue Recognition - Schedule of Disaggregated Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Disaggregation of Revenue [Line Items] | ||
Total income | $ 211 | $ 678 |
Broker-Dealer Fees and Commissions | ||
Disaggregation of Revenue [Line Items] | ||
Servicing income | 175 | 215 |
Gain on Loan Sales | ||
Disaggregation of Revenue [Line Items] | ||
Servicing income | 7 | |
Other investment income | ||
Disaggregation of Revenue [Line Items] | ||
Servicing income | 1 | 1 |
Other Non-Interest Income | ||
Disaggregation of Revenue [Line Items] | ||
Servicing income | 5 | |
Lending Fees | ||
Disaggregation of Revenue [Line Items] | ||
Non-interest income, out of scope, ASC 606 | $ 35 | 50 |
Charitable contributions, with donor restrictions | ||
Disaggregation of Revenue [Line Items] | ||
Non-interest income, out of scope, ASC 606 | $ 400 |
Revenue Recognition - Revenue f
Revenue Recognition - Revenue from Management Of Invested Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Securities commissions | ||
Disaggregation of Revenue [Line Items] | ||
Income from related party | $ 54 | $ 27 |
Securities commissions, Transactional | ||
Disaggregation of Revenue [Line Items] | ||
Income from related party | 39 | 15 |
Securities commissions, AUM | ||
Disaggregation of Revenue [Line Items] | ||
Income from related party | 15 | 12 |
Sale of investment company shares | ||
Disaggregation of Revenue [Line Items] | ||
Income from related party | 24 | 20 |
Sale of investment company shares, Transactional | ||
Disaggregation of Revenue [Line Items] | ||
Income from related party | 2 | 3 |
Sale of investment company shares, AUM | ||
Disaggregation of Revenue [Line Items] | ||
Income from related party | 22 | 17 |
Other insurance product revenue | ||
Disaggregation of Revenue [Line Items] | ||
Income from related party | 11 | 90 |
Other insurance product revenue, Transactional | ||
Disaggregation of Revenue [Line Items] | ||
Income from related party | 78 | |
Other insurance product revenue, AUM | ||
Disaggregation of Revenue [Line Items] | ||
Income from related party | 11 | 12 |
Advisory fee income | ||
Disaggregation of Revenue [Line Items] | ||
Income from related party | 86 | 78 |
Advisory fee income, AUM | ||
Disaggregation of Revenue [Line Items] | ||
Income from related party | 86 | 78 |
Broker-dealer revenue | ||
Disaggregation of Revenue [Line Items] | ||
Income from related party | 175 | 215 |
Broker-dealer revenue, Transactional | ||
Disaggregation of Revenue [Line Items] | ||
Income from related party | 41 | 96 |
Broker-dealer revenue, AUM | ||
Disaggregation of Revenue [Line Items] | ||
Income from related party | $ 134 | $ 119 |
Loan Sales - Summary of Loan Pa
Loan Sales - Summary of Loan Participation Sales and Servicing Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Loan participation interests sold by the Company | $ 7 | $ 502 | |
Total participation interests sold and serviced by the Company | $ 31,200 | 34,006 | 31,466 |
Balance, beginning of period | 98 | 123 | 123 |
Additions: Servicing obligations from sale of loan participations | 9 | 18 | |
Subtractions: Amortization | (10) | (10) | (43) |
Balance, end of period | 88 | 122 | 98 |
Servicing | |||
Servicing income | $ 32 | $ 37 | $ 134 |
Loan Sales - Narrative (Details
Loan Sales - Narrative (Details) - ACCU - Master LP Agreement | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2024 USD ($) | Mar. 31, 2023 USD ($) loan | Dec. 31, 2023 USD ($) | |
Number of loans sold | 0 | 2 | |
Loans sold to related party | $ 7,000 | $ 7,000 | $ 7,000 |
Foreclosed Assets - Narrative (
Foreclosed Assets - Narrative (Details) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2024 USD ($) property | Mar. 31, 2023 USD ($) | Dec. 31, 2023 USD ($) property | |
Repossessed Assets [Abstract] | |||
Number of foreclosed assets | property | 1 | 1 | |
Foreclosed assets, net | $ 301,000 | $ 301,000 | |
Allowance for losses on foreclosed assets | 0 | $ 0 | |
Provision for losses on foreclosed assets | $ 0 | $ 0 |
Foreclosed Assets - Foreclosed
Foreclosed Assets - Foreclosed Asset Expenses (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Repossessed Assets [Abstract] | ||
Operating expenses | $ 10 | $ 4 |
Total foreclosed asset expenses | $ 10 | $ 4 |
Premises and Equipment - Summar
Premises and Equipment - Summary of Premises and Equipment (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Property, Plant and Equipment [Line Items] | |||
Total premises and equipment | $ 718 | $ 704 | |
Less accumulated depreciation and amortization | (623) | (648) | |
Premises and equipment, net | 95 | 56 | |
Depreciation and amortization expense | 17 | $ 11 | |
Furniture and office equipment | |||
Property, Plant and Equipment [Line Items] | |||
Total premises and equipment | 449 | 440 | |
Computer system | |||
Property, Plant and Equipment [Line Items] | |||
Total premises and equipment | 226 | 221 | |
Leasehold improvements | |||
Property, Plant and Equipment [Line Items] | |||
Total premises and equipment | $ 43 | $ 43 |
Credit Facilities and Other D_3
Credit Facilities and Other Debt - Summary of Principal Terms of Term Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Line of Credit Facility [Line Items] | ||
Interest Rate, Line of Credit | 2.25% | |
Debt facilities | $ 95,720 | $ 97,031 |
ACCU Line of Credit. 9.00% maturing September 23, 2024 | ||
Line of Credit Facility [Line Items] | ||
Interest Rate, Line of Credit | 9.25% | |
KCT Warehouse LOC, 9.00% maturing on June 6, 2024 | ||
Line of Credit Facility [Line Items] | ||
Amount Available to Borrow | $ 5,000 | |
KCT Operating LOC, 9.00% maturing on June 6, 2024 | ||
Line of Credit Facility [Line Items] | ||
Debt facilities | 4,500 | |
Amount Available to Borrow | 500 | |
ACCU Line of Credit. 9.00% maturing September 23, 2024 | ||
Line of Credit Facility [Line Items] | ||
Debt facilities | 3,000 | 4,500 |
Amount Available to Borrow | $ 2,000 | |
ACCU line of credit | KCT Warehouse LOC, 9.00% maturing on June 6, 2024 | ||
Line of Credit Facility [Line Items] | ||
Interest Rate, Line of Credit | 9% | |
ACCU line of credit | KCT Operating LOC, 9.00% maturing on June 6, 2024 | ||
Line of Credit Facility [Line Items] | ||
Interest Rate, Line of Credit | 9% | |
ACCU line of credit | ACCU Line of Credit. 9.00% maturing September 23, 2024 | ||
Line of Credit Facility [Line Items] | ||
Interest Rate, Line of Credit | 9.25% | |
Secured term-debt | ||
Line of Credit Facility [Line Items] | ||
Amount of Collateral Pledged | $ 7 | 7 |
Secured term-debt | ACCU Secured, Various Interest Rate, Maturing on various dates | ||
Line of Credit Facility [Line Items] | ||
Debt facilities | 7 | |
Loans Receivable [Member] | ACCU Line of Credit. 9.00% maturing September 23, 2024 | ||
Line of Credit Facility [Line Items] | ||
Amount of Collateral Pledged | 7,100 | $ 7,200 |
Loans Receivable [Member] | ACCU line of credit | KCT Warehouse LOC, 9.00% maturing on June 6, 2024 | ||
Line of Credit Facility [Line Items] | ||
Amount of Collateral Pledged | 6,940 | |
Loans Receivable [Member] | ACCU line of credit | KCT Operating LOC, 9.00% maturing on June 6, 2024 | ||
Line of Credit Facility [Line Items] | ||
Amount of Collateral Pledged | 4,993 | |
Loans Receivable [Member] | ACCU line of credit | ACCU Line of Credit. 9.00% maturing September 23, 2024 | ||
Line of Credit Facility [Line Items] | ||
Amount of Collateral Pledged | 7,121 | |
Cash [Member] | Secured term-debt | KCT Warehouse LOC, 9.00% maturing on June 6, 2024 | ||
Line of Credit Facility [Line Items] | ||
Amount of Collateral Pledged | 1,250 | |
Cash [Member] | Secured term-debt | ACCU Secured, Various Interest Rate, Maturing on various dates | ||
Line of Credit Facility [Line Items] | ||
Amount of Collateral Pledged | $ 7 |
Credit Facilities and Other D_4
Credit Facilities and Other Debt - Narrative (Details) | 3 Months Ended | 9 Months Ended | ||||
Jun. 06, 2022 USD ($) item | Sep. 23, 2021 USD ($) | Mar. 31, 2024 USD ($) | Sep. 30, 2022 USD ($) | Mar. 15, 2024 | Dec. 31, 2023 USD ($) | |
Line of Credit Facility [Line Items] | ||||||
Debt facilities | $ 95,720,000 | $ 97,031,000 | ||||
Interest rate | 2.25% | |||||
Other secured borrowings | $ 7,000 | 7,000 | ||||
ACCU Secured, Various Interest Rate, Maturing on various dates | ||||||
Line of Credit Facility [Line Items] | ||||||
Other secured borrowings | $ 7,000 | 7,000 | ||||
ACCU Line of Credit. 9.00% maturing September 23, 2024 | ||||||
Line of Credit Facility [Line Items] | ||||||
Minimum collateralization ratio | 120% | |||||
Interest rate | 9.25% | |||||
Minimum Liquidity | $ 10,000,000 | |||||
Maximum borrowing capacity | $ 5,000,000 | |||||
Facility maturity date | Sep. 23, 2022 | |||||
Spread over prime rate | 0.75% | |||||
Facility renewal period | 1 year | |||||
Minimum cancellation notice | 90 days | |||||
Maturity period | 1 year | |||||
ACCU Line of Credit. 9.00% maturing September 23, 2024 | Minimum | ||||||
Line of Credit Facility [Line Items] | ||||||
Interest rate | 4% | |||||
Kct Warehousing And Operating Line Of Credit [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Minimum Net Worth to be maintained | $ 5,000,000 | |||||
Percentage of total liabilities equal to Net worth | 5% | |||||
Kct Warehousing And Operating Line Of Credit [Member] | Minimum | ||||||
Line of Credit Facility [Line Items] | ||||||
Minimum collateralization ratio | 120% | |||||
KCT Warehouse LOC, 9.00% maturing on June 6, 2024 | ||||||
Line of Credit Facility [Line Items] | ||||||
Maximum borrowing capacity | $ 5,000,000 | |||||
KCT Operating LOC, 9.00% maturing on June 6, 2024 | ||||||
Line of Credit Facility [Line Items] | ||||||
Debt facilities | $ 4,500,000 | |||||
Maximum borrowing capacity | $ 5,000,000 | |||||
ACCU Line of Credit. 9.00% maturing September 23, 2024 | ||||||
Line of Credit Facility [Line Items] | ||||||
Debt facilities | 3,000,000 | 4,500,000 | ||||
ACCU Line of Credit. 9.00% maturing September 23, 2024 | Loans Receivable [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Collateral pledged | 7,100,000 | 7,200,000 | ||||
KCT Credit Union | ||||||
Line of Credit Facility [Line Items] | ||||||
Interest rate | 2.25% | |||||
Number of short-term demand credit facilities | item | 2 | |||||
Debt repaid | $ 7,000,000 | |||||
KCT Credit Union | KCT Warehouse LOC, 9.00% maturing on June 6, 2024 | ||||||
Line of Credit Facility [Line Items] | ||||||
Debt facilities | $ 0 | 0 | ||||
Interest rate | 9% | |||||
Maximum borrowing capacity | $ 5,000,000 | |||||
Spread over prime rate | 0.50% | |||||
Percentage of deposits on borrowing limit | 25% | |||||
Due period of repayment of each advance | 120 days | |||||
Maturity period | 1 year | |||||
Delinquency period | 60 days | |||||
Collateral pledged | $ 6,900,000 | 6,000,000 | ||||
Certificate of Deposit Acquired | $ 1,250,000 | |||||
KCT Credit Union | KCT Warehouse LOC, 9.00% maturing on June 6, 2024 | Does Not Intend To Renew Agreement [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Facility renewal period | 1 year | |||||
Minimum cancellation notice | 30 days | |||||
KCT Credit Union | KCT Warehouse LOC, 9.00% maturing on June 6, 2024 | Minimum | ||||||
Line of Credit Facility [Line Items] | ||||||
Minimum collateralization ratio | 120% | |||||
KCT Credit Union | KCT Operating LOC, 9.00% maturing on June 6, 2024 | ||||||
Line of Credit Facility [Line Items] | ||||||
Debt facilities | $ 4,500,000 | 0 | ||||
Interest rate | 9% | |||||
Secured by cash | 25% | |||||
Maximum borrowing capacity | $ 5,000,000 | |||||
Spread over prime rate | 0.50% | |||||
Maturity period | 1 year | |||||
Delinquency period | 60 days | |||||
Collateral pledged | $ 5,000,000 | $ 4,600,000 | ||||
KCT Credit Union | KCT Operating LOC, 9.00% maturing on June 6, 2024 | Does Not Intend To Renew Agreement [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Facility renewal period | 1 year | |||||
Minimum cancellation notice | 30 days | |||||
KCT Credit Union | KCT Operating LOC, 9.00% maturing on June 6, 2024 | Minimum | ||||||
Line of Credit Facility [Line Items] | ||||||
Minimum collateralization ratio | 120% | |||||
ACCU | ACCU Line of Credit. 9.00% maturing September 23, 2024 | ||||||
Line of Credit Facility [Line Items] | ||||||
Maximum borrowing capacity | $ 5,000,000 |
Debt Certificates Payable- Narr
Debt Certificates Payable- Narrative (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||
Mar. 31, 2024 USD ($) | Dec. 31, 2023 USD ($) | Feb. 05, 2024 USD ($) series | Jan. 08, 2021 USD ($) item | Feb. 27, 2018 USD ($) | Feb. 18, 2018 item | |
Debt Instrument [Line Items] | ||||||
Debt certificates payable, debt issuance costs | $ 130 | $ 52 | ||||
Class 1A Offering | ||||||
Debt Instrument [Line Items] | ||||||
Number of series in class of notes | item | 2 | |||||
Notes authorized, maximum | $ 90,000 | |||||
Debt Instrument, Covenant Compliance | The Company is in compliance with these covenants as of March 31, 2024 and December 31, 2023. | The Company is in compliance with these covenants as of March 31, 2024 and December 31, 2023. | ||||
2021 Class A Offering | ||||||
Debt Instrument [Line Items] | ||||||
Number of series in class of notes | item | 2 | |||||
Notes authorized, maximum | $ 125,000 | |||||
Debt Instrument, Covenant Compliance | The Company is in compliance with these covenants as of March 31, 2024 and December 31, 2023. | The Company is in compliance with these covenants as of March 31, 2024 and December 31, 2023. | ||||
2024 Class A Offering | ||||||
Debt Instrument [Line Items] | ||||||
Number of series in class of notes | series | 2 | |||||
Notes authorized, maximum | $ 200,000 | |||||
Debt Instrument, Covenant Compliance | The Company is in compliance with these covenants as of March 31, 2024. | The Company is in compliance with these covenants as of March 31, 2024. | ||||
Subordinated Notes [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt Instrument, Covenant Compliance | The Company was in compliance with these covenants as of March 31, 2024 and December 31, 2023 | The Company was in compliance with these covenants as of March 31, 2024 and December 31, 2023 | ||||
Subordinated Notes [Member] | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Maturity period | 12 months | |||||
Subordinated Notes [Member] | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Maturity period | 60 months | |||||
Subordinated Notes [Member] | Swap Index Rate [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate measurement period | 7 days |
Debt Certificates Payable - Sch
Debt Certificates Payable - Schedule of Debt Securities Payable (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Debt Instrument [Line Items] | ||
Total debt certificates payable | $ 95,720 | $ 97,031 |
Weighted Average Interest Rate | 4.60% | 4.82% |
Public Offerings [Member] | ||
Debt Instrument [Line Items] | ||
Total debt certificates payable | $ 81,181 | $ 81,976 |
Weighted Average Interest Rate | 4.55% | 4.83% |
Public Offerings [Member] | 2021 Class A Offering | ||
Debt Instrument [Line Items] | ||
Total debt certificates payable | $ 66,240 | $ 69,421 |
Weighted Average Interest Rate | 4.96% | 4.95% |
Public Offerings [Member] | Class 1A Offering | ||
Debt Instrument [Line Items] | ||
Total debt certificates payable | $ 10,142 | $ 12,555 |
Weighted Average Interest Rate | 4.04% | 4.19% |
Public Offerings [Member] | 2024 Class A Offering | ||
Debt Instrument [Line Items] | ||
Total debt certificates payable | $ 4,799 | |
Weighted Average Interest Rate | 5.01% | |
Private Offerings [Member] | ||
Debt Instrument [Line Items] | ||
Total debt certificates payable | $ 14,539 | $ 15,055 |
Weighted Average Interest Rate | 4.83% | 4.76% |
Private Offerings [Member] | Subordinated Notes [Member] | ||
Debt Instrument [Line Items] | ||
Total debt certificates payable | $ 14,539 | $ 15,055 |
Weighted Average Interest Rate | 4.83% | 4.76% |
Debt Certificates Payable - S_2
Debt Certificates Payable - Schedule of Maturities of Debt Securities (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Debt Instrument [Line Items] | ||
Total | $ 95,720 | $ 97,031 |
Debt issuance costs | 130 | 52 |
Debt certificates payable, net of debt issuance costs | 95,590 | $ 96,979 |
Notes Payable [Member] | ||
Debt Instrument [Line Items] | ||
2025 | 46,638 | |
2026 | 22,958 | |
2027 | 18,359 | |
2028 | 3,860 | |
2029 | 3,905 | |
Total | 95,720 | |
Debt issuance costs | 130 | |
Debt certificates payable, net of debt issuance costs | $ 95,590 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 USD ($) Option | Apr. 30, 2022 | |
Commitments And Contingencies [Line Items] | ||
Lease liabilities recorded | $ 387 | |
Right-of-use assets obtained in exchange for operating lease liabilities | 387 | |
Fresno [Member] | ||
Commitments And Contingencies [Line Items] | ||
Lease renewal | 3 years | |
Olen Pointe Brea Corp | Brea [Member] | ||
Commitments And Contingencies [Line Items] | ||
Monthly rental payments | 6,790 | |
Lease liabilities recorded | 387 | |
Right-of-use assets obtained in exchange for operating lease liabilities | $ 387 | |
Lease renewal | 5 years | |
Number of lease extension options remaining | Option | 1 |
Commitments and Contingencies_2
Commitments and Contingencies - Unfunded Commitments (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Undisbursed Loans [Member] | ||
Commitments And Contingencies [Line Items] | ||
Undisbursed loans | $ 478 | $ 221 |
Standby Letters of Credit [Member] | ||
Commitments And Contingencies [Line Items] | ||
Undisbursed loans | $ 2,000 |
Commitments and Contingencies_3
Commitments and Contingencies - Allowance for credit losses on off-balance sheet commitments (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Jan. 01, 2023 | Mar. 31, 2024 | Dec. 31, 2023 | |
Off-Balance-Sheet, Credit Loss, Liability [Roll Forward] | |||
Balance, beginning of period | $ 0 | $ 2 | $ 0 |
Provision for losses on unfunded commitments | 0 | 1 | |
Balance, end of period | 2 | 2 | |
Cumulative Effect, Period of Adoption, Adjustment [Member] | Accounting Standards Update 2016-13 [Member] | |||
Off-Balance-Sheet, Credit Loss, Liability [Roll Forward] | |||
Balance, beginning of period | 1 | $ 0 | 1 |
Provision for losses on unfunded commitments | $ 1 | ||
Balance, end of period | $ 0 |
Commitments and Contingencies_4
Commitments and Contingencies - Information About Existing Operating Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Commitments and Contingencies [Abstract] | |||
Operating lease cost | $ 45 | $ 44 | $ 176 |
Cash paid for operating leases | 13 | $ 51 | $ 190 |
Right-of-use assets obtained in exchange for operating lease liabilities | 387 | ||
Lease liabilities recorded | $ 387 | ||
Weighted average remaining lease term (in years) | 4 years 9 months 18 days | 1 year 3 months 7 days | 1 year 2 months 26 days |
Weighted-average discount rate | 4.60% | 4.28% | 3.64% |
Commitments and Contingencies_5
Commitments and Contingencies - Future Minimum Lease Payments and Lease Costs (Details) $ in Thousands | Mar. 31, 2024 USD ($) |
Commitments and Contingencies [Abstract] | |
Lease Payments, 2025 | $ 89 |
Lease Payments, 2026 | 87 |
Lease Payments, 2027 | 87 |
Lease Payments, 2028 | 89 |
Lease Payments, 2029 | 92 |
Lease Payments, Thereafter | 31 |
Lease Payments, Total | 475 |
Lease Costs, 2025 | 117 |
Lease Costs, 2026 | 84 |
Lease Costs, 2027 | 82 |
Lease Costs, 2028 | 82 |
Lease Costs, 2029 | 82 |
Lease Costs, Thereafter | 27 |
Lease Costs, Total | $ 474 |
Preferred and Common Units un_2
Preferred and Common Units under LLC Structure - Narrative (Details) | 3 Months Ended | |
Mar. 31, 2024 item / shares item $ / shares | Dec. 31, 2023 $ / shares | |
Class of Stock [Line Items] | ||
Liquidation preference, per share | $ / shares | $ 100 | $ 100 |
Preferred Stock [Member] | ||
Class of Stock [Line Items] | ||
Spread over LIBOR | 0.25% | |
Interest rate measurement period | 1 year | |
Preferred stock, dividend payment rate | 10% | |
Liquidation preference, per share | $ / shares | $ 100 | |
Number of voting rights | item / shares | 0 | |
Threshold of number of consecutive quarters without paid preferred return for appointment of managers | item | 4 | |
Number of managers that can be appointed after threshold for period of unpaid preferred returns reached | item | 2 |
Retirement Plans - Narrative (D
Retirement Plans - Narrative (Details) - USD ($) | 3 Months Ended | ||
Mar. 30, 2022 | Mar. 31, 2024 | Mar. 31, 2023 | |
401(k) plan [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Minimum age restriction for participation | 21 years | ||
Maximum voluntary percentage contributions of salary (as a percent) | 86% | ||
Contribution percentage, company match as percent of employee contribution | 3% | ||
Contribution percentage, percent of company match after initial threshold | 50% | ||
Contribution percentage, initial threshold for change in company matching contribution | 3% | ||
Matching contributions by employer | $ 16,000 | $ 29,000 | |
Minimum service period | 0 years | ||
401(k) plan [Member] | Maximum | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Contribution percentage, company match as percent of employee contribution | 5% | ||
Profit Sharing [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Minimum age restriction for participation | 21 years | ||
Matching contributions by employer | $ 0 | $ 0 | |
Minimum number of service hours required in plan year to be eligible under plan | 900 hours | ||
Supplemental Executive Retirement Plan [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Retirement plan term | 10 years | ||
Retirement plan annual benefit payment | $ 60,000 | ||
Retirement plan maximum benefit payment | $ 600,000 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Carrying Amounts and Estimated Fair Values of Financial Instruments (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Carrying Value | ||
FINANCIAL ASSETS: | ||
Cash and restricted cash | $ 12,953 | $ 12,611 |
Certificates of deposit | 1,251 | 1,279 |
Loans, net | 99,901 | 98,573 |
Investment in joint venture | 870 | 871 |
Other investments | 1,053 | 1,052 |
Accrued interest receivable | 464 | 432 |
Servicing assets | 88 | 98 |
FINANCIAL LIABILITIES: | ||
Lines of credit | 7,500 | 4,500 |
Other secured borrowings | 7 | 7 |
Debt certificates payable | 95,590 | 96,979 |
Other financial liabilities | 514 | 531 |
Fair Value | ||
FINANCIAL ASSETS: | ||
Cash and restricted cash | 12,953 | 12,611 |
Certificates of deposit | 1,251 | 1,275 |
Loans, net | 97,407 | 95,913 |
Investment in joint venture | 870 | 871 |
Other investments | 1,053 | 1,052 |
Accrued interest receivable | 464 | 432 |
Servicing assets | 88 | 98 |
FINANCIAL LIABILITIES: | ||
Lines of credit | 7,500 | 4,501 |
Other secured borrowings | 7 | 7 |
Debt certificates payable | 95,624 | 97,399 |
Other financial liabilities | 514 | 531 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
FINANCIAL ASSETS: | ||
Cash and restricted cash | 12,953 | 12,611 |
Significant Other Observable Inputs (Level 2) | ||
FINANCIAL ASSETS: | ||
Certificates of deposit | 1,251 | 1,275 |
Significant Unobservable Inputs (Level 3) | ||
FINANCIAL ASSETS: | ||
Loans, net | 97,407 | 95,913 |
Investment in joint venture | 870 | 871 |
Other investments | 1,053 | 1,052 |
Accrued interest receivable | 464 | 432 |
Servicing assets | 88 | 98 |
FINANCIAL LIABILITIES: | ||
Lines of credit | 7,500 | 4,501 |
Other secured borrowings | 7 | 7 |
Debt certificates payable | 95,624 | 97,399 |
Other financial liabilities | $ 514 | $ 531 |
Fair Value Measurements - Sch_2
Fair Value Measurements - Schedule of Fair Value Measured on a Nonrecurring Basis (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Foreclosed assets (net of allowance) | $ 301 | $ 301 |
Significant Unobservable Inputs (Level 3) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Collateral-dependent impaired loans (net of allowance and discount) | 97,407 | 95,913 |
Investment in joint venture | 870 | 871 |
Other investments | 1,053 | 1,052 |
Fair Value Measured on a Nonrecurring Basis | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Collateral-dependent impaired loans (net of allowance and discount) | 2,870 | 2,896 |
Investment in joint venture | 870 | 871 |
Other investments | 1,053 | 1,052 |
Foreclosed assets (net of allowance) | 301 | 301 |
Total | 5,094 | 5,120 |
Fair Value Measured on a Nonrecurring Basis | Significant Unobservable Inputs (Level 3) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Collateral-dependent impaired loans (net of allowance and discount) | 2,870 | 2,896 |
Investment in joint venture | 870 | 871 |
Other investments | 1,053 | 1,052 |
Foreclosed assets (net of allowance) | 301 | 301 |
Total | $ 5,094 | $ 5,120 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 USD ($) contract | Dec. 31, 2023 USD ($) | |
Fair Value Disclosures [Abstract] | ||
Number of indexed annuity insurance contracts | contract | 2 | |
Impairment of the annuity investments | $ | $ 0 | $ 0 |
Fair Value Measurements - Sch_3
Fair Value Measurements - Schedule of Valuation Methodologies Used to Measure the Fair Value Adjustments for Level 3 Assets Recorded at Fair Value on a Nonrecurring Basis (Details) $ in Thousands | Mar. 31, 2024 USD ($) item | Dec. 31, 2023 USD ($) item | Dec. 31, 2015 USD ($) |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis, Valuation Techniques [Line Items] | |||
Investment in joint venture | $ | $ 870 | $ 871 | $ 900 |
Foreclosed assets, net | $ | 301 | 301 | |
Discounted appraised value | Significant Unobservable Inputs (Level 3) | Impaired Loans | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis, Valuation Techniques [Line Items] | |||
Impaired Loans | $ | 2,870 | $ 2,896 | |
Impaired loans, measurement input | 0.10 | ||
Internal evaluations | Significant Unobservable Inputs (Level 3) | Investment in joint venture | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis, Valuation Techniques [Line Items] | |||
Investment in joint venture | $ | $ 870 | $ 871 | |
Investment in joint venture, measurement input | 0 | 0 | |
Internal evaluations | Significant Unobservable Inputs (Level 3) | Other Investments | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis, Valuation Techniques [Line Items] | |||
Other investments | $ | $ 1,053 | $ 1,052 | |
Other investments, measurement input | 0 | 0 | |
Internal evaluations | Significant Unobservable Inputs (Level 3) | Foreclosed Assets | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis, Valuation Techniques [Line Items] | |||
Foreclosed assets, net | $ | $ 301 | $ 301 | |
Foreclosed assets. measurement input | 0.06 | 0.06 | |
Minimum | Discounted appraised value | Significant Unobservable Inputs (Level 3) | Impaired Loans | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis, Valuation Techniques [Line Items] | |||
Impaired loans, measurement input | 0.10 | ||
Maximum | Discounted appraised value | Significant Unobservable Inputs (Level 3) | Impaired Loans | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis, Valuation Techniques [Line Items] | |||
Impaired loans, measurement input | (0.10) | ||
Weighted Average | Discounted appraised value | Significant Unobservable Inputs (Level 3) | Impaired Loans | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis, Valuation Techniques [Line Items] | |||
Impaired loans, measurement input | (0.10) | ||
Weighted Average | Internal evaluations | Significant Unobservable Inputs (Level 3) | Investment in joint venture | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis, Valuation Techniques [Line Items] | |||
Investment in joint venture, measurement input | 0 | 0 | |
Weighted Average | Internal evaluations | Significant Unobservable Inputs (Level 3) | Other Investments | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis, Valuation Techniques [Line Items] | |||
Other investments, measurement input | 0 | 0 | |
Weighted Average | Internal evaluations | Significant Unobservable Inputs (Level 3) | Foreclosed Assets | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis, Valuation Techniques [Line Items] | |||
Foreclosed assets. measurement input | 0.06 | 0.06 |
Income Taxes and State LLC Fe_2
Income Taxes and State LLC Fees - Narrative (Details) - USD ($) | 3 Months Ended | |||
Mar. 31, 2024 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Line Items] | ||||
Operating loss carryforward expiration | Dec. 31, 2032 | |||
Percentage of net investment income to calculate provision for federal excise tax | 1% | |||
Maximum | ||||
Income Tax Disclosure [Line Items] | ||||
Federal excise tax rate | 2% | |||
Minimum | ||||
Income Tax Disclosure [Line Items] | ||||
Federal excise tax rate | 1% | |||
California Franchise Tax Board | ||||
Income Tax Disclosure [Line Items] | ||||
Gross receipt fee based on turnover | $ 12,000 | |||
State minimum franchise tax | 800 | |||
MP Securities | California Franchise Tax Board | ||||
Income Tax Disclosure [Line Items] | ||||
Gross receipt fee based on turnover | 6,000 | |||
State minimum franchise tax | $ 800 | |||
MP Realty | ||||
Income Tax Disclosure [Line Items] | ||||
Recorded provision | $ 800 | $ 800 | ||
Operating loss carryforwards | $ 432,000 | $ 422,000 | ||
Valuation allowance, percentage | 100% | 100% |
Segment Information - Narrative
Segment Information - Narrative (Details) | 3 Months Ended |
Mar. 31, 2024 segment | |
Segment Reporting [Abstract] | |
Number of segments | 3 |
Segment Information - Schedule
Segment Information - Schedule of Financial Information by Reportable Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Segment Reporting Information [Line Items] | |||
Revenue | $ 211 | $ 678 | |
Interest expense | 1,265 | 918 | |
Total non-interest expense and provision for tax | 1,158 | 1,375 | |
Net profit (loss) | (349) | (68) | |
Total assets | 117,947 | $ 116,647 | |
External Sources | |||
Segment Reporting Information [Line Items] | |||
Revenue | 2,022 | 2,063 | |
Adjustments / Eliminations | |||
Segment Reporting Information [Line Items] | |||
Interest expense | (344) | (334) | |
Total non-interest expense and provision for tax | (30) | ||
Net profit (loss) | 144 | (127) | |
Total assets | (86) | (218) | |
Adjustments / Eliminations | External Sources | |||
Segment Reporting Information [Line Items] | |||
Revenue | (72) | ||
Adjustments / Eliminations | Internal Sources | |||
Segment Reporting Information [Line Items] | |||
Revenue | (159) | (461) | |
Finance Company | Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Interest expense | 1,609 | 1,252 | |
Total non-interest expense and provision for tax | 750 | 961 | |
Net profit (loss) | (533) | (636) | |
Total assets | 110,859 | 109,724 | |
Finance Company | Operating Segments | External Sources | |||
Segment Reporting Information [Line Items] | |||
Revenue | 1,774 | 1,416 | |
Broker-Dealer | Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Total non-interest expense and provision for tax | 407 | 414 | |
Net profit (loss) | 50 | 295 | |
Total assets | 5,020 | 4,977 | |
Broker-Dealer | Operating Segments | External Sources | |||
Segment Reporting Information [Line Items] | |||
Revenue | 300 | 247 | |
Broker-Dealer | Operating Segments | Internal Sources | |||
Segment Reporting Information [Line Items] | |||
Revenue | 159 | 461 | |
Charitable Organization | Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Total non-interest expense and provision for tax | 31 | ||
Net profit (loss) | (10) | 400 | |
Total assets | 2,097 | 2,108 | |
Charitable Organization | Operating Segments | External Sources | |||
Segment Reporting Information [Line Items] | |||
Revenue | 20 | $ 400 | |
Other Segments | Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Total assets | $ 57 | $ 56 |
Not-for-profit Subsidiary Act_3
Not-for-profit Subsidiary Activities (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Not-for-profit Disclosures | |||
Interest Income | $ 1,811 | $ 1,385 | |
MPC | |||
Not-for-profit Disclosures | |||
Cash held in checking account | 341 | $ 304 | |
Cash that carries permanent donor restrictions | 1,700 | 1,700 | |
Net assets | 2,100 | ||
Net assets permanently restricted by donors | 1,700 | ||
Net assets that are unrestricted by donors | 358 | 368 | |
Interest Income | 20 | ||
MPC | Maximum | |||
Not-for-profit Disclosures | |||
Interest Income | $ 1 | ||
MPC | Board | |||
Not-for-profit Disclosures | |||
Cash held in checking account | $ 0 | $ 0 |
Not-for-profit Subsidiary Act_4
Not-for-profit Subsidiary Activities - Breakdown of expenses (Details) - MPC $ in Thousands | 3 Months Ended |
Mar. 31, 2024 USD ($) | |
Not-for-profit Disclosures | |
Charitable grants | $ 30 |
General and administrative expenses | 1 |
Total | $ 31 |
Not-for-profit Subsidiary Act_5
Not-for-profit Subsidiary Activities - Change in net assets (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
MPC | ||
Not-for-profit Disclosures | ||
Change in net assets | $ (10) | $ 400 |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Pay vs Performance Disclosure | ||
Net Income (Loss) | $ (349) | $ (68) |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Mar. 31, 2024 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |