v3.22.4
Fair Value of Financial Instruments
 6 Months Ended
Dec. 31, 2022
Fair Value Disclosures [Abstract]  
Fair Value of Financial Instruments Fair Value of Financial Instruments
Fair value is the exchange price that would be received for an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. There are three levels of inputs that may be used to measure fair values:
Level 1:    Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.
Level 2:    Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.
Level 3:    Significant unobservable inputs that reflect a company's own assumptions about the assumptions that market participants would use in pricing an asset or liability.
A financial instrument's level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The following is a description of valuation methodologies used for assets recorded at fair value. The Company does not have any liabilities recorded at fair value.
The methods of determining the fair value of assets and liabilities presented in this note are consistent with the methodologies disclosed in Note 19 of the 2022 Form 10-K.
Financial Assets Recorded at Fair Value
The following table presents financial assets measured at fair value on a recurring basis at the dates indicated:
December 31, 2022
TotalLevel 1Level 2Level 3
Debt securities available for sale
U.S government agencies$15,399 $— $15,399 $— 
MBS, residential84,447 — 84,447 — 
Municipal bonds4,409 — 4,409 — 
Corporate bonds43,687 — 43,687 — 
Total debt securities available for sale$147,942 $— $147,942 $— 
Loans held for sale$518 $— $518 $— 
June 30, 2022
TotalLevel 1Level 2Level 3
Debt securities available for sale
U.S government agencies$18,459 $— $18,459 $— 
MBS, residential47,233 — 47,233 — 
Municipal bonds5,558 — 5,558 — 
Corporate bonds55,728 — 55,728 — 
Total debt securities available for sale$126,978 $— $126,978 $— 
Loans held for sale carried at fair value are valued at the individual loan level using quoted secondary market prices.
There were no transfers between levels during the six months ended December 31, 2022 and 2021.
The following table presents financial assets measured at fair value on a non-recurring basis at the dates indicated:
December 31, 2022
TotalLevel 1Level 2Level 3
Collateral dependent loans
Commercial loans
Commercial and industrial$169 $— $— $169 
June 30, 2022
TotalLevel 1Level 2Level 3
Collateral dependent loans
Commercial loans
Commercial and industrial$415 $— $— $415 
A loan is considered to be collateral dependent when, based on current information and events, the Company expects repayment of the financial assets to be provided substantially through the operation or sale of the collateral and the Company has determined that the borrower is experiencing financial difficulty as of the measurement date. For real estate loans, the fair value of the loan's collateral is determined by a third party appraisal, which is then adjusted for the estimated selling and closing costs related to liquidation of the collateral (typically ranging from 8% to 12% of the appraised value). For this asset class, the actual valuation methods (income, sales comparable, or cost) vary based on the status of the project or property. Additional discounts of 5% to 15% may be applied depending on the age of the appraisals. The unobservable inputs may vary depending on the individual asset with no one of the three methods being the predominant approach. For non-real estate loans, the fair value of the loan's collateral may be determined using an appraisal, net book value per the borrower's financial statements, or aging reports, adjusted or discounted based on management's historical knowledge, changes in market conditions from the time of the valuation, and management's expertise and knowledge of the customer and customer's business.
The stated carrying value and estimated fair value amounts of financial instruments as of December 31, 2022 and June 30, 2022, are summarized below:
 December 31, 2022
Carrying
Value		Fair
Value		Level 1Level 2Level 3
Assets
Cash and cash equivalents$165,034 $165,034 $165,034 $— $— 
Certificates of deposit in other banks
29,371 29,371 — 29,371 — 
Debt securities available for sale, at fair value147,942 147,942 — 147,942 — 
FHLB and FRB stock13,661 N/AN/AN/AN/A
SBIC investments
12,414 12,414 — — 12,414 
Loans held for sale, at fair value518 518 — 518 — 
Loans held for sale, at the lower of cost
  or fair value
72,777 74,917 — — 74,917 
Loans, net
2,946,764 2,867,148 — — 2,867,148 
Accrued interest receivable
11,076 11,076 — 642 10,434 
Liabilities
Noninterest-bearing and NOW deposits1,365,312 1,365,312 — 1,365,312 — 
Money market accounts
992,083 992,083 — 992,083 — 
Savings accounts
230,896 230,896 — 230,896 — 
Certificates of deposit
459,729 450,270 — 450,270 — 
Borrowings
130,000 130,000 — 130,000 — 
Accrued interest payable
358 358 — 358 — 
 June 30, 2022
Carrying
Value		Fair
Value		Level 1Level 2Level 3
Assets
Cash and cash equivalents$105,119 $105,119 $105,119 $— $— 
Commercial paper, net194,427 194,427 194,427 — — 
Certificates of deposit in other banks
23,551 23,551 — 23,551 — 
Debt securities available for sale126,978 126,978 — 126,978 — 
FHLB and FRB stock9,326 N/AN/AN/AN/A
SBIC investments
12,758 12,758 — — 12,758 
Loans held for sale
79,307 80,489 — — 80,489 
Loans, net
2,734,605 2,687,293 — — 2,687,293 
Accrued interest receivable
8,573 8,573 24 580 7,969 
Liabilities
Noninterest-bearing and NOW deposits1,400,727 1,400,727 — 1,400,727 — 
Money market accounts
969,661 969,661 — 969,661 — 
Savings accounts
238,197 238,197 — 238,197 — 
Certificates of deposit
491,176 485,452 — 485,452 — 
Accrued interest payable
80 80 — 80 — 
The Company had off-balance sheet financial commitments, which included approximately $922,831 and $921,239 of commitments to originate loans, undisbursed portions of construction loans, unused lines of credit, and standby letters of credit at December 31, 2022 and June 30, 2022, respectively (see "Note 9 – Commitments and Contingencies"). Since these commitments are based on current rates, the carrying amount approximates the fair value.