Kentucky First Federal Bancorp
For the period ended Jun 30, 2024. Filed Oct 3, 2024.
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FY2024 · Filed Oct 3, 2024
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EX-13 · Credit Quality Indicators:
Credit Quality Indicators:
The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. The Company analyzes loans individually by classifying the loans as to credit risk. This analysis is performed on an annual basis. The Company uses the following definitions for risk ratings:
Special Mention. Loans classified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date.
**Substandard.**Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.
**Doubtful.**Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions and values, highly questionable and improbable.
Loans not meeting the criteria above that are analyzed individually as part of the above-described process are considered to be pass rated loans. Loans listed that are not rated are included in groups of homogeneous loans and are evaluated for credit quality based on performing status. See the aging of past due loan table above. As of June 30, 2024, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows:
| Revolving | ||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (in thousands) · Term Loans Amortized Cost by Origination Fiscal Year · Loans Amortized | ||||||||||||||||
| As of March 31, 2024 · 2024 · 2023 · 2022 · 2021 · 2020 · Prior · Cost Basis · Total | ||||||||||||||||
| Residential real estate: | ||||||||||||||||
| One- to four-family | ||||||||||||||||
| Risk Rating: | ||||||||||||||||
| Pass | $29,792 | $50,814 | $47,346 | $42,943 | $26,794 | $52,616 | $ | - | $250,485 | |||||||
| Special mention | - | - | - | - | - | 667 | - | 667 | ||||||||
| Substandard | - | - | -- | 81 | 110 | 4,873 | - | 5,064 | ||||||||
| Doubtful | - | - | - | - | - | - | - | - | ||||||||
| Total | $29,792 | $50,814 | $47,346 | $43,024 | $26,904 | $58,156 | $ | - | $256,216 | |||||||
| Current period gross charge offs | $ | - | $ | - | $ | - | $ | - | $ | - | $16 | $ | - | $16 | ||
| Multi-family | ||||||||||||||||
| Risk Rating: | ||||||||||||||||
| Pass | $400 | $6,076 | $5,907 | $1,239 | $ | - | $2,193 | $ | - | $15,815 | ||||||
| Special mention | - | - | - | - | - | - | - | - | ||||||||
| Substandard | - | - | - | - | - | - | - | - | ||||||||
| Doubtful | - | - | - | - | - | - | - | - | ||||||||
| Total | $400 | $6,076 | $5,907 | $1,239 | $ | - | $2,193 | $ | - | $15,815 | ||||||
| Current period gross charge offs | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - |
| Construction | ||||||||||||||||
| Risk Rating: | ||||||||||||||||
| Pass | $8,230 | $5,562 | $23 | $ | - | $ | - | $ | - | $ | - | $13,815 | ||||
| Special mention | - | - | - | - | - | - | - | - | ||||||||
| Substandard | - | - | - | - | - | - | - | - | ||||||||
| Doubtful | - | - | - | - | - | - | - | - | ||||||||
| Total | $8,230 | $5,562 | $23 | $ | - | $ | - | $ | - | $ | - | $13,815 | ||||
| Current period gross charge offs | $ | - | $6 | $ | - | $ | - | $ | - | $ | - | $ | - | $6 | ||
| Land | ||||||||||||||||
| Risk Rating: | ||||||||||||||||
| Pass | $401 | $252 | $213 | $ | - | $ | - | $70 | $ | - | $936 | |||||
| Special mention | - | - | - | - | - | - | - | - | ||||||||
| Substandard | - | - | - | - | - | 28 | - | - | ||||||||
| Doubtful | - | - | - | - | - | - | - | - | ||||||||
| Total | $401 | $252 | $213 | $ | - | $ | - | $98 | $ | - | $964 | |||||
| Current period gross charge offs | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - |
| Farm | ||||||||||||||||
| Risk Rating: | ||||||||||||||||
| Pass | $ | - | $ | - | $221 | $ | - | $ | - | $948 | $ | - | $1,169 | |||
| Special mention | - | - | - | - | - | - | - | - | ||||||||
| Substandard | - | - | - | - | - | - | - | - | ||||||||
| Doubtful | - | - | - | - | - | - | - | - | ||||||||
| Total | $ | - | $ | - | $221 | $ | - | $ | - | $948 | $ | - | $1,169 | |||
| Current period gross charge offs | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - |
| Nonresidential real estate | ||||||||||||||||
| Risk Rating: | ||||||||||||||||
| Pass | $7,828 | $1,561 | $3,099 | $3,406 | $5,711 | $10,648 | $ | - | $32,253 | |||||||
| Special mention | - | - | - | - | - | 130 | - | 130 | ||||||||
| Substandard | - | 1,017 | - | - | - | 908 | - | 1,925 | ||||||||
| Doubtful | - | - | - | - | - | - | - | - | ||||||||
| Total | $7,828 | $2,578 | $3,099 | $3,406 | $5,711 | $11,686 | $ | - | $34,308 | |||||||
| Current period gross charge offs | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - |
| Commercial and industrial | ||||||||||||||||
| Risk Rating: | ||||||||||||||||
| Pass | $482 | $214 | $ | - | $4 | $ | - | $ | - | $ | - | $700 | ||||
| Special mention | - | - | - | - | - | - | - | - | ||||||||
| Substandard | - | - | - | - | - | - | - | - | ||||||||
| Doubtful | - | - | - | - | - | - | - | - | ||||||||
| Total | $482 | $214 | $ | - | $4 | $ | - | $ | - | $ | - | $700 | ||||
| Current period gross charge offs | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - |
| Share Loans | ||||||||||||||||
| Risk Rating: | ||||||||||||||||
| Pass | $116 | $113 | $20 | $15 | $176 | $379 | $ | - | $819 | |||||||
| Special mention | - | - | - | - | - | - | - | - | ||||||||
| Substandard | - | - | - | - | - | - | - | - | ||||||||
| Doubtful | - | - | - | - | - | - | - | - | ||||||||
| Total | $116 | $113 | $20 | $15 | $176 | $379 | $ | - | $819 | |||||||
| Current period gross charge offs | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - |
| Home Equity | ||||||||||||||||
| Risk Rating: | ||||||||||||||||
| Pass | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $10,490 | $10,490 | ||
| Special mention | - | - | - | - | - | - | - | - | ||||||||
| Substandard | - | - | - | - | - | - | 154 | 154 | ||||||||
| Doubtful | - | - | - | - | - | - | - | - | ||||||||
| Total | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $10,644 | $10,644 | ||
| Current period gross charge offs | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - |
| Auto | ||||||||||||||||
| Risk Rating: | ||||||||||||||||
| Pass | $68 | $9 | $30 | $3 | $2 | $5 | $ | - | $117 | |||||||
| Special mention | - | - | - | - | - | - | - | - | ||||||||
| Substandard | - | - | - | - | - | - | - | - | ||||||||
| Doubtful | - | - | - | - | - | - | - | - | ||||||||
| Total | $68 | $9 | $30 | $3 | $2 | $5 | $ | - | $117 | |||||||
| Current period gross charge offs | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - |
| Unsecured | ||||||||||||||||
| Risk Rating: | ||||||||||||||||
| Pass | $285 | $34 | $24 | $174 | $13 | $55 | $ | - | $585 | |||||||
| Special mention | - | - | - | - | - | - | - | - | ||||||||
| Substandard | - | - | - | - | - | - | - | - | ||||||||
| Doubtful | - | - | - | - | - | - | - | - | ||||||||
| Total | $285 | $34 | $24 | $174 | $13 | $55 | $ | - | $585 | |||||||
| Current period gross charge offs | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - |
As of June 30, 2024, and 2023, and based on the most recent analysis performed, the risk category of loans by class of loans was as follows:
| (in thousands) · Pass · Special Mention · Substandard · Doubtful | |||||
|---|---|---|---|---|---|
| Residential real estate | |||||
| One- to four-family | $250,485 | $667 | $5,064 | $ | - |
| Multi-family | 15,815 | - | - | - | |
| Construction | 13,815 | - | - | - | |
| Land | 936 | - | 28 | - | |
| Farm | 1,169 | - | - | - | |
| Nonresidential real estate | 32,253 | 130 | 1,925 | - | |
| Commercial and industrial | 700 | - | - | - | |
| Consumer and other | |||||
| Loans on deposits | 819 | - | - | - | |
| Home equity | 10,490 | - | 154 | - | |
| Automobile | 117 | - | - | - | |
| Unsecured | 585 | - | - | - | |
| $327,184 | $797 | $7,171 | $ | - | |
| (in thousands) · Pass · Special Mention · Substandard · Doubtful | |||||
|---|---|---|---|---|---|
| Residential real estate | |||||
| One- to four-family | $234,765 | $170 | $5,141 | $ | - |
| Multi-family | 19,067 | - | - | - | |
| Construction | 12,294 | - | - | - | |
| Land | 470 | - | - | - | |
| Farm | 1,346 | - | - | - | |
| Nonresidential real estate | 27,816 | 684 | 1,717 | - | |
| Commercial and industrial | 1,184 | - | - | - | |
| Consumer and other | |||||
| Loans on deposits | 855 | - | - | - | |
| Home equity | 8,879 | - | 338 | - | |
| Automobile | 104 | - | - | - | |
| Unsecured | 611 | - | - | - | |
| $307,391 | $854 | $7,196 | $ | - | |
The following tables present the activity in the allowance for loan losses by portfolio segment for the years ended June 30, 2024 and 2023:
| (in thousands) · Pre-ASC 326 Adoption · Impact of ASC 326 Adoption · As Reported Under ASC 326 · Provision for (recovery of) credit losses on loans · Loans charged off · Recoveries · Credit Losses for Unfunded Liabilities · Ending balance | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Residential real estate | ||||||||||
| One- to four-family | $857 | $740 | $1,597 | $82 | $(18) | $ | - | $ | - | $1,661 |
| Multi-family | 278 | (145) | 133 | (33) | - | - | - | 100 | ||
| Construction | 41 | 97 | 138 | (12) | - | - | (4) | 122 | ||
| Land | 1 | 14 | 15 | 13 | - | - | - | 28 | ||
| Farm | 4 | 2 | 6 | (2) | - | - | - | 4 | ||
| Nonresidential real estate | 405 | (221) | 184 | 8 | - | - | - | 192 | ||
| Commercial and industrial | 23 | (18) | 5 | (2) | - | - | - | 3 | ||
| Consumer and other | ||||||||||
| Loans on deposits | 1 | (1) | - | - | - | - | - | - | ||
| Home equity | 23 | 28 | 51 | (31) | (8) | 4 | (2) | 14 | ||
| Automobile | - | 1 | 1 | (1) | - | - | - | - | ||
| Unsecured | 1 | - | 1 | 2 | - | - | - | 3 | ||
| $1,634 | $497 | $2,131 | $24 | $(26) | $4 | $(6) | $2,127 | |||
| (in thousands) | Beginning balance | Provision (credit) for loan losses | Loans charged off | Recoveries | Ending balance |
|---|---|---|---|---|---|
| Residential real estate | |||||
| One- to four-family | $800 | $73 | $(29) | $13 | $857 |
| Multi-family | 231 | 47 | - | - | 278 |
| Construction | 4 | 37 | - | - | 41 |
| Land | 3 | (2) | - | - | 1 |
| Farm | 5 | (1) | - | - | 4 |
| Nonresidential real estate | 461 | (64) | - | 8 | 405 |
| Commercial and industrial | 2 | 21 | - | - | 23 |
| Consumer and other | |||||
| Loans on deposits | 1 | - | - | - | 1 |
| Home equity | 21 | 2 | - | - | 23 |
| Automobile | - | - | - | - | |
| Unsecured | 1 | - | - | - | 1 |
| $1,529 | $113 | $(29) | $21 | $1,634 | |
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.