Axos Financial Inc
For the period ended Dec 31, 2023. Filed Jan 30, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Dec 31, 2023 · Filed Jan 30, 2024
Extracted filing text, with the paragraph anchors used by the comparison.
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4. Available-for-Sale Securities
- AVAILABLE-FOR-SALE SECURITIES
The amortized cost and fair value of available-for-sale securities were:
| December 31, 2023 | ||||
|---|---|---|---|---|
| (Dollars in thousands) | AmortizedCost | UnrealizedGains | UnrealizedLosses | FairValue |
| Mortgage-backed securities (MBS): | ||||
| U.S. agencies1 | $31,048 | $238 | $(2,622) | $28,664 |
| Non-agency2 | 209,783 | 911 | (2,986) | 207,708 |
| Total mortgage-backed securities | 240,831 | 1,149 | (5,608) | 236,372 |
| Non-MBS: | ||||
| Municipal | 3,721 | — | (281) | 3,440 |
| Total Non-MBS | 3,721 | — | (281) | 3,440 |
| Total available-for-sale securities | $244,552 | $1,149 | $(5,889) | $239,812 |
| June 30, 2023 | ||||
| (Dollars in thousands) | AmortizedCost | UnrealizedGains | UnrealizedLosses | FairValue |
| Mortgage-backed securities (MBS): | ||||
| U.S. agencies1 | $27,024 | $— | $(3,077) | $23,947 |
| Non-agency2 | 210,271 | 711 | (5,977) | 205,005 |
| Total mortgage-backed securities | 237,295 | 711 | (9,054) | 228,952 |
| Non-MBS: | ||||
| Municipal | 3,656 | — | (258) | 3,398 |
| Total Non-MBS | 3,656 | — | (258) | 3,398 |
| Total available-for-sale securities | $240,951 | $711 | $(9,312) | $232,350 |
2 Private sponsors of securities collateralized primarily by first-lien mortgage loans on commercial properties or by pools of 1-4 family residential first mortgages. Primarily super senior securities secured by Alt-A or pay-option ARM mortgages.
No credit losses were recognized on available-for-sale securities in the three and six months ended December 31, 2023 and December 31, 2022. Based on the underlying government guarantees and other credit protection supporting our securities, no allowance for credit losses for available-for-sale securities was recorded at December 31, 2023 and June 30, 2023. The Company has no allowance for the available-for-sale securities in an unrealized loss position based on an analysis of: (1) the credit characteristics of the securities, including the forecasted cash flows, credit ratings, credit enhancement, and external government backing, as applicable, and (2) whether the Company is intending to sell or is required to sell any securities before recovering the amortized cost basis of the securities. The unrealized losses on available-for-sale securities are primarily driven by the increase in interest rates since the securities were purchased.
The face amounts of available-for-sale securities pledged to secure borrowings at December 31, 2023 and June 30, 2023 were $0.8 million and $0.9 million, respectively.
During the three and six months ended December 31, 2023 and 2022, the Company sold a $4.8 million available-for-sale security withno realized gain or loss.
Securities with unrealized losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, were:
| December 31, 2023 | ||||||
|---|---|---|---|---|---|---|
| Available-for-sale securities in loss position for | ||||||
| Less Than12 Months | More Than12 Months | Total | ||||
| (Dollars in thousands) | FairValue | GrossUnrealizedLosses | FairValue | GrossUnrealizedLosses | FairValue | GrossUnrealizedLosses |
| MBS: | ||||||
| U.S. agencies | $25 | $— | $20,762 | $(2,622) | $20,787 | $(2,622) |
| Non-agency | 42,324 | (71) | 133,670 | (2,915) | 175,994 | (2,986) |
| Total MBS | 42,349 | (71) | 154,432 | (5,537) | 196,781 | (5,608) |
| Non-MBS: | ||||||
| Municipal | — | — | 3,440 | (281) | 3,440 | (281) |
| Total Non-MBS | — | — | 3,440 | (281) | 3,440 | (281) |
| Total available-for-sale securities | $42,349 | $(71) | $157,872 | $(5,818) | $200,221 | $(5,889) |
| June 30, 2023 | ||||||
| Available-for-sale securities in loss position for | ||||||
| Less Than12 Months · More Than12 Months · Total | ||||||
| (Dollars in thousands) | FairValue | GrossUnrealizedLosses | FairValue | GrossUnrealizedLosses | FairValue | GrossUnrealizedLosses |
| MBS: | ||||||
| U.S. agencies | $3,182 | $(16) | $20,642 | $(3,061) | $23,824 | $(3,077) |
| Non-agency | 107,982 | (1,808) | 95,385 | (4,169) | 203,367 | (5,977) |
| Total MBS | 111,164 | (1,824) | 116,027 | (7,230) | 227,191 | (9,054) |
| Non-MBS: | ||||||
| Municipal | — | — | 3,398 | (258) | 3,398 | (258) |
| Total Non-MBS | — | — | 3,398 | (258) | 3,398 | (258) |
| Total available-for-sale securities | $111,164 | $(1,824) | $119,425 | $(7,488) | $230,589 | $(9,312) |
The components of the Company’s accumulated other comprehensive income (loss) are as follows:
| (Dollars in thousands) | December 31, 2023 | June 30, 2023 |
|---|---|---|
| Available-for-sale securities—net unrealized gains (losses) | $(4,740) | $(8,601) |
| Available-for-sale securities—non-credit related | (845) | (845) |
| Subtotal | (5,585) | (9,446) |
| Tax benefit (expense) | 1,666 | 2,836 |
| Net unrealized gain (loss) on investment securities in accumulated other comprehensive income (loss) | $(3,919) | $(6,610) |
The following table sets forth the expected maturity distribution of our mortgage-backed securities, which is based on assumed prepayment rates, and the maturity distribution of our non-MBS, which is based on the contractual maturity:
| As of December 31, 2023 | |||||
|---|---|---|---|---|---|
| (Dollars in thousands) | Total Amount | Due Within One Year | Due after One but within Five Years | Due after Five but within Ten Years | Due After Ten Years |
| MBS: | |||||
| Agency1 | $31,048 | $6,907 | $14,543 | $7,222 | $2,376 |
| Non-Agency2 | $209,783 | $163,929 | $43,425 | $1,534 | $895 |
| Total MBS | $240,831 | $170,836 | $57,968 | $8,756 | $3,271 |
| Non-MBS: | |||||
| Municipal | $3,721 | $— | $— | $— | $3,721 |
| Total Non-MBS | $3,721 | $— | $— | $— | $3,721 |
| Available-for-sale—Amortized cost | $244,552 | $170,836 | $57,968 | $8,756 | $6,992 |
| Available-for-sale—Fair value | $239,812 | $168,400 | $56,864 | $8,181 | $6,367 |
2 Private sponsors of securities collateralized primarily by pools of 1-4 family residential, Alt-A or pay-option ARM mortgages and commercial mortgages.
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.