Company Quick10K Filing
Consumers Bancorp
Price18.43 EPS2
Shares3 P/E9
MCap50 P/FCF16
Net Debt-13 EBIT10
TEV38 TEV/EBIT4
TTM 2019-09-30, in MM, except price, ratios
10-Q 2020-09-30 Filed 2020-11-12
10-K 2020-06-30 Filed 2020-09-23
10-Q 2020-03-31 Filed 2020-05-08
10-Q 2019-12-31 Filed 2020-02-12
10-Q 2019-09-30 Filed 2019-11-08
10-K 2019-06-30 Filed 2019-09-12
10-Q 2019-03-31 Filed 2019-05-15
10-Q 2018-12-31 Filed 2019-02-14
10-Q 2018-09-30 Filed 2018-11-14
10-K 2018-06-30 Filed 2018-09-12
10-Q 2018-03-31 Filed 2018-05-15
10-Q 2017-12-31 Filed 2018-02-14
10-Q 2017-09-30 Filed 2017-11-07
10-K 2017-06-30 Filed 2017-09-21
10-Q 2017-03-31 Filed 2017-05-15
10-Q 2016-12-31 Filed 2017-02-14
10-Q 2016-09-30 Filed 2016-11-14
10-K 2016-06-30 Filed 2016-09-22
10-Q 2016-03-31 Filed 2016-05-16
10-Q 2015-12-31 Filed 2016-02-16
10-Q 2015-09-30 Filed 2015-11-16
10-K 2015-06-30 Filed 2015-09-23
10-Q 2015-03-31 Filed 2015-05-15
10-Q 2014-12-31 Filed 2015-02-17
10-Q 2014-09-30 Filed 2014-11-14
10-K 2014-06-30 Filed 2014-09-24
10-Q 2014-03-31 Filed 2014-05-15
10-Q 2013-12-31 Filed 2014-02-14
10-Q 2013-09-30 Filed 2013-11-14
10-K 2013-06-30 Filed 2013-09-24
10-Q 2013-03-31 Filed 2013-05-15
10-Q 2012-12-31 Filed 2013-02-14
10-Q 2012-09-30 Filed 2012-11-14
10-K 2012-06-30 Filed 2012-09-21
10-Q 2012-03-31 Filed 2012-05-14
10-Q 2011-12-31 Filed 2012-02-13
10-Q 2011-09-30 Filed 2011-11-10
10-K 2011-06-30 Filed 2011-09-16
10-Q 2011-03-31 Filed 2011-05-16
10-Q 2010-12-31 Filed 2011-02-11
10-Q 2010-09-30 Filed 2010-11-15
10-K 2010-06-30 Filed 2010-09-22
10-Q 2010-03-31 Filed 2010-05-17
10-Q 2009-12-31 Filed 2010-02-12
8-K 2020-10-29 Shareholder Vote
8-K 2020-10-21 Earnings, Exhibits
8-K 2020-09-10 Accountant
8-K 2020-08-13 Officers
8-K 2020-08-06 Earnings, Exhibits
8-K 2020-04-22
8-K 2020-03-13
8-K 2020-03-11
8-K 2020-01-16
8-K 2020-01-01
8-K 2019-10-17
8-K 2019-10-16
8-K 2019-10-15
8-K 2019-07-31
8-K 2019-06-14
8-K 2019-04-18
8-K 2019-01-22
8-K 2019-01-22
8-K 2018-10-18
8-K 2018-10-18
8-K 2018-07-26
8-K 2018-06-13
8-K 2018-04-24
8-K 2018-01-26

CBKM 10Q Quarterly Report

Part I - Financial Information
Item 1 - Financial Statements
Note 1 - Summary of Significant Accounting Policies:
Note 2 - Acquisition
Note 3 - Securities
Note 4 - Loans
Note 5 - Fair Value
Note 6 - Earnings per Share
Note 7 - Accumulated Other Comprehensive Income (Loss)
Note 8 - Covid - 19
Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 4 - Controls and Procedures
Part II - Other Information
Item 1 - Legal Proceedings
Item 2 - Unregistered Sales of Equity Securities and Use of Proceeds
Item 3 - Defaults Upon Senior Securities
Item 4 - Mine Safety Disclosures
Item 5 - Other Information
Item 6 - Exhibits
EX-31.1 ex_213054.htm
EX-31.2 ex_213055.htm
EX-32.1 ex_213056.htm

Consumers Bancorp Earnings 2020-09-30

Balance SheetIncome StatementCash Flow
0.60.50.40.20.10.02012201420172020
Assets, Equity
0.10.10.10.00.00.02016201720182020
Rev, G Profit, Net Income
0.10.10.0-0.0-0.1-0.12012201420172020
Ops, Inv, Fin

10-Q 1 cbkm20200930_10q.htm FORM 10-Q cbkm20200930_10q.htm
 

 



 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 10-Q

 

Quarterly Report Pursuant to Section 13 or 15 (d) of the Securities Exchange Act of 1934

 

For the quarterly period ended September 30, 2020

 

Commission File No. 033-79130

 

CONSUMERS BANCORP, INC.

(Exact name of registrant as specified in its charter)

 

OHIO 

34-1771400

(State or other jurisdiction

(I.R.S. Employer Identification No.)

of incorporation or organization)

 

 

614 East Lincoln Way, P.O. Box 256, Minerva, Ohio  

44657

(Address of principal executive offices)  

(Zip Code)

 

(330) 868-7701

(Registrant’s telephone number)

 

Not applicable

(Former name, former address and former fiscal year, if changed since last report)

 

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ☒ No ☐

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☒ No ☐

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer ☐   

Accelerated filer ☐  

Non-accelerated filer ☐  

Smaller reporting company ☒

 

Emerging growth company ☐

         

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).      Yes ☐ No ☒

 

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

None

   

 

There were 3,028,100 shares of Registrant’s common stock, no par value, outstanding as of November 10, 2020.

 

 

 

 

CONSUMERS BANCORP, INC.

FORM 10-Q

QUARTER ENDED September 30, 2020

 

Table of Contents

 

 

Page

Number (s)

Part I – Financial Information

 

 

Item 1 – Financial Statements (Unaudited)

 

Consolidated Balance Sheets at September 30, 2020 and June 30, 2020

1

 

 

Consolidated Statements of Income for the three months ended September 30, 2020 and 2019

2

 

 

Consolidated Statements of Comprehensive Income for the three months ended September 30, 2020 and 2019

3

 

 

Condensed Consolidated Statements of Changes in Shareholders’ Equity for the three months ended September 30, 2020 and 2019

4

 

 

Condensed Consolidated Statements of Cash Flows for the three months ended September 30, 2020 and 2019

5

 

 

Notes to the Consolidated Financial Statements

6-19

 

 

Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations

20-26

 

 

Item 3 – Not Applicable for Smaller Reporting Companies

 

 

 

Item 4 – Controls and Procedures

27

Part II – Other Information

Item 1 – Legal Proceedings

28

 

 

Item 1A – Not Applicable for Smaller Reporting Companies

28

 

 

Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds

28

 

 

Item 3 – Defaults Upon Senior Securities

28

 

 

Item 4 – Mine Safety Disclosure

28

 

 

Item 5 – Other Information

28

 

 

Item 6 – Exhibits

28

 

 

Signatures

29

 

 

 
 

PART I – FINANCIAL INFORMATION

Item 1 – Financial Statements

 

CONSUMERS BANCORP, INC.

CONSOLIDATED BALANCE SHEETS (Unaudited)

 

(Dollars in thousands, except per share data)

 

September 30,

2020

   

June 30,

2020

 

ASSETS

               

Cash on hand and noninterest-bearing deposits in financial institutions

  $ 8,239     $ 8,429  

Federal funds sold and interest-bearing deposits in financial institutions

    269       1,230  

Total cash and cash equivalents

    8,508       9,659  

Certificates of deposit in other financial institutions

    8,872       11,635  

Securities, available-for-sale

    136,903       143,918  

Securities, held-to-maturity (fair value of $3,734 at September 30, 2020 and $3,868 at June 30, 2020)

    3,441       3,541  

Federal bank and other restricted stocks, at cost

    2,472       2,472  

Loans held for sale

    5,729       3,507  

Total loans

    562,138       542,861  

Less allowance for loan losses

    (5,767

)

    (5,678

)

Net loans

    556,371       537,183  

Cash surrender value of life insurance

    9,508       9,442  

Premises and equipment, net

    15,151       14,901  

Goodwill

    836       836  

Core deposit intangible, net

    250       256  

Accrued interest receivable and other assets

    3,229       3,470  

Total assets

  $ 751,270     $ 740,820  
                 

LIABILITIES

               

Deposits

               

Noninterest-bearing demand

  $ 188,130     $ 190,233  

Interest bearing demand

    105,262       99,173  

Savings

    231,440       228,567  

Time

    115,266       115,382  

Total deposits

    640,098       633,355  
                 

Short-term borrowings

    8,414       6,943  

Federal Home Loan Bank advances

    30,899       31,161  

Accrued interest and other liabilities

    6,432       6,121  

Total liabilities

    685,843       677,580  

Commitments and contingent liabilities

               
                 

SHAREHOLDERS’ EQUITY

               

Preferred stock (no par value, 350,000 shares authorized, none outstanding)

           

Common stock (no par value, 8,500,000 shares authorized; 3,124,053 shares issued as of September 30, 2020 and June 30, 2020)

    20,011       19,974  

Retained earnings

    42,424       40,460  

Treasury stock, at cost (95,953 and 108,475 common shares as of September 30, 2020 and June 30, 2020, respectively)

    (1,324

)

    (1,454

)

Accumulated other comprehensive income

    4,316       4,260  

Total shareholders’ equity

    65,427       63,240  

Total liabilities and shareholders’ equity

  $ 751,270     $ 740,820  

 

See accompanying notes to consolidated financial statements

 

1

 

 

CONSUMERS BANCORP, INC.

CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

 

   

Three Months ended

September 30,

 

(Dollars in thousands, except per share amounts)

 

2020

   

2019

 
                 

Interest and dividend income

               

Loans, including fees

  $ 6,489     $ 4,761  

Securities, taxable

    372       510  

Securities, tax-exempt

    420       399  

Federal bank and other restricted stocks

    18       20  

Federal funds sold and other interest-bearing deposits

    47       26  

Total interest and dividend income

    7,346       5,716  

Interest expense

               

Deposits

    577       945  

Short-term borrowings

    4       11  

Federal Home Loan Bank advances

    71       79  

Total interest expense

    652       1,035  

Net interest income

    6,694       4,681  

Provision for loan losses

    130       130  

Net interest income after provision for loan losses

    6,564       4,551  
                 

Noninterest income

               

Service charges on deposit accounts

    307       373  

Debit card interchange income

    456       391  

Gain on sale of mortgage loans

    236       135  

Bank owned life insurance death benefit

          324  

Bank owned life insurance income

    66       68  

Securities gains, net

          106  

Other

    76       72  

Total noninterest income

    1,141       1,469  
                 

Noninterest expenses

               

Salaries and employee benefits

    2,691       2,173  

Occupancy and equipment

    640       532  

Data processing expenses

    186       385  

Debit card processing expenses

    238       201  

Professional and director fees

    237       257  

FDIC assessments

    61       (7

)

Franchise taxes

    109       95  

Marketing and advertising

    134       181  

Telephone and network communications

    84       74  

Amortization of intangible

    6        

Other

    413       414  

Total noninterest expenses

    4,799       4,305  

Income before income taxes

    2,906       1,715  

Income tax expense

    505       212  

Net income

  $ 2,401     $ 1,503  
                 

Basic and diluted earnings per share

  $ 0.80     $ 0.55  

 

See accompanying notes to consolidated financial statements

 

2

 

 

CONSUMERS BANCORP, INC.

Consolidated statements of comprehensive income

(Unaudited)

 

(Dollars in thousands)

               
   

Three Months ended

September 30,

 
   

2020

   

2019

 
                 

Net income

  $ 2,401     $ 1,503  
                 

Other comprehensive income, net of tax:

               

Net change in unrealized gains (losses) on securities available-for-sale:

               

Unrealized gains arising during the period

    70       818  

Reclassification adjustment for gains included in income

          (106

)

Net unrealized gains

    70       712  

Income tax effect

    (14

)

    (149

)

Other comprehensive income

    56       563  
                 

Total comprehensive income

  $ 2,457     $ 2,066  

 

See accompanying notes to consolidated financial statements.

 

3

 

 

CONSUMERS BANCORP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

(Unaudited)

 

 

(Dollars in thousands, except per share data)

 

Common

Stock

   

Retained
Earnings

   

Treasury
Stock

   

Accumulated
Other
Comprehensive
Income (Loss)

   

Total
Shareholders’
Equity

 

Balance, June 30, 2020

  $ 19,974     $ 40,460     $ (1,454

)

  $ 4,260     $ 63,240  

Net income

            2,401                       2,401  

Other comprehensive income

                            56       56  

12,522 shares associated with vested stock awards

    37               130               167  

Cash dividends declared ($0.145 per share)

            (437

)

                    (437

)

Balance, September 30, 2020

  $ 20,011     $ 42,424     $ (1,324

)

  $ 4,316     $ 65,427  
                                         
                                         

Balance, June 30, 2019

  $ 14,656     $ 36,487     $ (1,543

)

  $ 1,566     $ 51,166  

Net income

            1,503                       1,503  

Other comprehensive income

                            563       563  

11,813 shares associated with vested stock awards

    41               89               130  

Cash dividends declared ($0.135 per share)

            (369

)

                    (369

)

Balance, September 30, 2019

  $ 14,697     $ 37,621     $ (1,454

)

  $ 2,129     $ 52,993  

 

See accompanying notes to consolidated financial statements.

 

4

 

 

CONSUMERS BANCORP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

 

(Dollars in thousands)

 

Three Months Ended

September 30,

 
   

2020

   

2019

 

Cash flows from operating activities

               

Net cash from operating activities

  $ 1,041     $ 806  

Cash flow from investing activities

               

Purchases of securities, available-for-sale

    (500

)

    (2,318

)

Maturities, calls and principal pay downs of securities, available-for-sale

    7,355       4,893  

Sale of securities, available-for-sale

          4,460  

Principal pay downs of securities, held-to-maturity

    100       100  

Net decrease in certificate of deposit in other financial institutions

    2,763       490  

Net increase in loans

    (19,327

)

    (14,654

)

Proceeds from BOLI death benefit

          753  

Premises and equipment purchases

    (106

)

    (48

)

Sale of other repossessed assets

    8        

Net cash from investing activities

    (9,707

)

    (6,324

)

Cash flow from financing activities

               

Net increase in deposit accounts

    6,743       15,260  

Net change in short-term borrowings

    1,471       68  

Proceeds from Federal Home Loan Bank advances

    1,300       1,500  

Repayments of Federal Home Loan Bank advances

    (1,562

)

    (7,900

)

Dividends paid

    (437

)

    (369

)

Net cash from financing activities

    7,515       8,559  

Increase (decrease) in cash or cash equivalents

    (1,151

)

    3,041  

Cash and cash equivalents, beginning of period

    9,659       9,461  

Cash and cash equivalents, end of period

  $ 8,508     $ 12,502  

Supplemental disclosure of cash flow information:

               

Cash paid during the period:

               

Interest

  $ 652     $ 1,050  

Federal income taxes

    300        

Non-cash items:

               

Issuance of treasury stock for stock awards

    167       89  

Right of use assets obtained in exchange for lease liabilities

          582  

 

See accompanying notes to consolidated financial statements.

 

5

 

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited)

 

(Dollars in thousands, except per share amounts)

 

 

Note 1 – Summary of Significant Accounting Policies:

 

Nature of Operations: Consumers Bancorp, Inc. (the Corporation) is a bank holding company headquartered in Minerva, Ohio that provides, through its banking subsidiary, Consumers National Bank (the Bank), a broad array of products and services throughout its primary market area of Carroll, Columbiana, Jefferson, Stark, Summit, Wayne and contiguous counties in Ohio. The Bank’s business involves attracting deposits from businesses and individual customers and using such deposits to originate commercial, mortgage and consumer loans in its primary market area.

 

Basis of Presentation: The consolidated financial statements for interim periods are unaudited and reflect all adjustments (consisting of only normal recurring adjustments), which, in the opinion of management, are necessary to present fairly the financial position and results of operations and cash flows for the periods presented. The unaudited financial statements are presented in accordance with the requirements of Form 10-Q and do not include all disclosures normally required by accounting principles generally accepted in the United States of America. The financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Corporation’s Form 10-K for the year ended June 30, 2020. The results of operations for the interim period disclosed herein are not necessarily indicative of the results that may be expected for a full year.

 

The consolidated financial statements include the accounts of the Corporation and the Bank. All significant inter-company transactions and accounts have been eliminated in consolidation.

 

Segment Information: The Corporation is a bank holding company engaged in the business of commercial and retail banking, which accounts for substantially all the revenues, operating income, and assets. Accordingly, all of the Corporation’s operations are recorded in one segment, banking.

 

Acquisition: At the date of acquisition the Corporation records the assets and liabilities of acquired companies on the Consolidated Balance Sheet at their fair value. The results of operations for acquired companies are included in the Corporation’s Consolidated Statements of Income beginning at the acquisition date. Expenses arising from acquisition activities are recorded in the Consolidated Statements of Income during the periods incurred.

 

Reclassifications: Certain items in prior financial statements have been reclassified to conform to the current presentation. Any reclassifications had no impact on prior year net income or shareholders’ equity.

 

Recently Issued Accounting Pronouncements Not Yet Effective: In June 2016, the Financial Accounting Standards Board (FASB) issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. This ASU adds a new Topic 326 to the codification and removes the thresholds that companies apply to measure credit losses on financial instruments measured at amortized cost, such as loans, receivables, and held-to-maturity debt securities. Under current U.S. generally accepted accounting principles, companies generally recognize credit losses when it is probable that the loss has been incurred. The revised guidance will remove all current loss recognition thresholds and will require companies to recognize an allowance for credit losses for the difference between the amortized cost basis of a financial instrument and the amount of amortized cost that the corporation expects to collect over the instrument’s contractual life. ASU 2016-13 also amends the credit loss measurement guidance for available-for-sale debt securities and beneficial interests in securitized financial assets. The guidance in ASU 2016-13 is effective for “public business entities,” as defined in the guidance, that are SEC filers for fiscal years and for interim periods within those fiscal years beginning after December 15, 2019. Early adoption of the guidance is permitted for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. However, during July 2019, FASB unanimously voted for a proposal to delay this ASU to January 2023 for smaller reporting companies. On October 16, 2019, FASB approved a final ASU delaying the effective date. The new guidance is effective for annual and interim periods beginning after December 15, 2022 for certain entities, including smaller reporting companies. The Corporation is a smaller reporting company.

 

6

 

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

 

(Dollars in thousands, except per share amounts)

 

 

Note 2 – Acquisition

 

On June 14, 2019, the Corporation entered into an Agreement and Plan of Merger with Peoples Bancorp of Mt. Pleasant, Inc. (Peoples) and its wholly owned subsidiary, The Peoples National Bank of Mount Pleasant (Peoples Bank). On January 1, 2020, Consumers completed the acquisition by merger of Peoples in a stock and cash transaction for an aggregate consideration of approximately $10,405. In connection with the acquisition, the Corporation issued 269,920 shares of common stock and paid $5,128 in cash to the former shareholders of Peoples. Immediately following the merger, Peoples Bank, was merged into the Corporation’s banking subsidiary, Consumers National Bank.

 

On December 31, 2019, Peoples had approximately $72,016 in total assets, $55,273 in loans and $60,826 in deposits at its three banking centers located in Mt. Pleasant, Adena, and Dillonvale, Ohio. The assets and liabilities of Peoples were recorded on the Corporation’s Balance Sheet at their estimated fair values as of January 1, 2020, the acquisition date, and Peoples’ results of operations are included in the Corporation’s Consolidated Statements of Income beginning on that date.

 

The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the date of acquisition of Peoples. The core deposit intangible will be amortized over ten years on a straight-line basis. Goodwill will not be amortized, but instead will be evaluated for impairment.

 

Consideration Paid

          $ 10,405  

Net assets acquired:

               

Cash and cash equivalents

  $ 833          

Certificates of deposit in other financial institutions

    11,839          

Securities, available-for-sale

    4,051          

Federal bank and other restricted stocks, at cost

    154          

Loans, net

    55,320          

Premises and equipment

    818          

Core deposit intangible

    270          

Accrued interest receivable and other assets

    140          

Noninterest-bearing deposits

    (11,979

)

       

Interest-bearing deposits

    (48,872

)

       

Federal funds purchased

    (2,348

)

       

Federal Home Loan Bank advances

    (491

)

       

Other liabilities

    (166

)

       

Total net assets acquired

            9,569  

Goodwill

          $ 836  

 

The acquired assets and liabilities were measured at estimated fair values. Management made certain estimates and exercised judgement in accounting for the acquisition. The fair value of loans was estimated using discounted contractual cash flows. The book balance of the loans at the time of the acquisition was $55,273 before considering Peoples’ allowance for loan losses, which was not carried over. The fair value disclosed above reflects a credit-related adjustment of $(890) and an adjustment for other factors of $937. Loans evidencing credit deterioration since origination, purchased credit impaired loans, included in loans receivable, were immaterial. Acquisition costs of $827 pre-tax, or $680 after-tax, were recorded during the twelve-month period ended June 30, 2020. The fair value measurements of assets acquired and liabilities assumed are subject to refinement for up to one year after the closing date of the acquisition as additional information relative to closing date fair values becomes available.

 

7

 

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

 

(Dollars in thousands, except per share amounts)

 

 

Note 3 – Securities

Available –for-Sale

 

Amortized
Cost

   

Gross
Unrealized
Gains

   

Gross
Unrealized
Losses

   

Fair
Value

 

September 30, 2020

                               

U.S. Treasury

  $ 749     $ 4     $     $ 753  

Obligations of U.S. government-sponsored entities and agencies

    9,880       372             10,252  

Obligations of state and political subdivisions

    60,795       3,238       (12

)

    64,021  

U.S. Government-sponsored mortgage-backed securities–residential

    44,540       1,588       (10

)

    46,118  

U.S. Government-sponsored mortgage-backed securities– commercial

    7,913       72       (4

)

    7,981  

U.S. Government-sponsored collateralized mortgage obligations– residential

    7,563       225       (10

)

    7,778  

Total available-for-sale securities

  $ 131,440     $ 5,499     $ (36

)

  $ 136,903  

 

Held-to-Maturity

 

Amortized
Cost

   

Gross
Unrecognized
Gains

   

Gross
Unrecognized

Losses

   

Fair
Value

 

September 30, 2020

                               

Obligations of state and political subdivisions

  $ 3,441     $ 293     $     $ 3,734  

Total held-to-maturity securities

  $ 3,441     $ 293     $     $ 3,734  

 

Available–for-Sale

 

Amortized
Cost

   

Gross
Unrealized
Gains

   

Gross
Unrealized
Losses

   

Fair
Value

 

June 30, 2020

                               

U.S. Treasury

  $ 1,248     $ 8     $     $ 1,256  

Obligations of U.S. government-sponsored entities and agencies

    10,133       399             10,532  

Obligations of state and political subdivisions

    60,343       3,149             63,492  

U.S. government-sponsored mortgage-backed securities - residential

    48,645       1,515       (4

)

    50,156  

U.S. government-sponsored mortgage-backed securities - commercial

    8,444       55       (2

)

    8,497  

U.S. government-sponsored collateralized mortgage obligations - residential

    9,712       285       (12

)

    9,985  

Total available-for-sale securities

  $ 138,525     $ 5,411     $ (18

)

  $ 143,918  

 

Held-to-Maturity

 

Amortized
Cost

   

Gross
Unrecognized
Gains

   

Gross
Unrecognized
Losses

   

Fair
Value

 

June 30, 2020

                               

Obligations of state and political subdivisions

  $ 3,541     $ 327     $     $ 3,868  

Total held-to-maturity securities

  $ 3,541     $ 327     $     $ 3,868  

 

Proceeds from the sale and call of available-for-sale securities were as follows:

 

   

Three Months Ended

September 30,

 
   

2020

   

2019

 

Proceeds from sales and calls

  $     $ 4,460  

Gross realized gains

          106  

 

8

 

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

 

(Dollars in thousands, except per share amounts)

 

The income tax provision related to the net realized gains amounted to $22 for the three months ended September 30, 2019.

 

The amortized cost and fair values of debt securities at September 30, 2020, by expected maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date, primarily mortgage-backed securities, are shown separately. 

 

Available-for-Sale

 

Amortized

Cost

   

Estimated Fair

Value

 

Due in one year or less

  $ 6,532     $ 6,558  

Due after one year through five years

    17,026       17,611  

Due after five years through ten years

    15,159       15,865  

Due after ten years

    32,707       34,992  

Total

    71,424       75,026  
                 

U.S. Government-sponsored mortgage-backed and related securities

    60,016       61,877  

Total available-for-sale securities

  $ 131,440     $ 136,903  
                 

Held-to-Maturity

               

Due after five years through ten years

  $ 373     $ 397  

Due after ten years

    3,068       3,337  

Total held-to-maturity securities

  $ 3,441     $ 3,734  

 

The following table summarizes the securities with unrealized losses at September 30, 2020 and June 30, 2020, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position:

 

   

Less than 12 Months

   

12 Months or more

   

Total

 

Available-for-sale

 

Fair
Value

   

Unrealized
Loss

   

Fair
Value

   

Unrealized
Loss

   

Fair
Value

   

Unrealized
Loss

 

September 30, 2020

                                               

Obligations of states and political subdivisions

  $ 1,061     $ (12

)

  $     $     $ 1,061     $ (12

)

U.S. Government-sponsored mortgage-backed securities – residential

    1,306       (10

)

                1,306       (10

)

U.S. Government-sponsored mortgage-backed securities- commercial

    1,654       (4

)

                1,654       (4

)

U.S. Government-sponsored collateralized mortgage obligations - residential

    1,263       (10

)

                1,263       (10

)

Total temporarily impaired

  $ 5,284     $ (36

)

  $     $     $ 5,284     $ (36

)

 

   

Less than 12 Months

   

12 Months or more

   

Total

 

Available-for-sale

 

Fair
Value

   

Unrealized
Loss

   

Fair
Value

   

Unrealized
Loss

   

Fair
Value

   

Unrealized
Loss

 

June 30, 2020

                                               

U.S. Government-sponsored mortgage-backed securities – residential

                625       (4

)

    625       (4

)

U.S. Government-sponsored mortgage-backed securities – commercial

    1,806       (2

)

                1,806       (2

)

U.S. Government-sponsored collateralized mortgage obligations - residential

    1,700       (12

)

                1,700       (12

)

Total temporarily impaired

  $ 3,506     $ (14

)

  $ 625     $ (4

)

  $ 4,131     $ (18

)

 

9

 

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

 

(Dollars in thousands, except per share amounts)

 

Management evaluates securities for other-than-temporary impairment (OTTI) on a quarterly basis, and more frequently when economic or market conditions warrant such an evaluation. The securities portfolio is evaluated for OTTI by segregating the portfolio into two general segments and applying the appropriate OTTI model. Investment securities are generally evaluated for OTTI under FASB ASC Topic 320, Accounting for Certain Investments in Debt and Equity Securities.

 

In determining OTTI under the ASC Topic 320 model, management considers many factors, including: (1) the length of time and the extent to which the fair value has been less than cost, (2) the financial condition and near-term prospects of the issuer, (3) whether the market decline was affected by macroeconomic conditions, and (4) whether the entity has the intent to sell the debt security or more likely than not will be required to sell the debt security before its anticipated recovery. The assessment of whether an other-than-temporary decline exists involves a high degree of subjectivity and judgment and is based on the information available to management at a point in time.

 

The unrealized losses within the securities portfolio as of September 30, 2020 have not been recognized into income because the decline in fair value is not attributed to credit quality and management does not intend to sell, and it is not likely that management will be required to sell, the securities prior to their anticipated recovery. The decline in fair value within the securities portfolio is largely due to increases in mortgage backed and collateralized mortgage obligations prepayment speeds impacting the yield on bonds that were purchased at a premium. The mortgage-backed securities and collateralized mortgage obligations were primarily issued by Fannie Mae, Freddie Mac and Ginnie Mae, institutions which the government has affirmed its commitment to support. The Corporation does not own any private label mortgage-backed securities.

 

 

Note 4 – Loans

 

Major classifications of loans were as follows:

 

   

September 30,

2020

   

June 30,

2020

 

Commercial

  $ 176,838     $ 158,667  

Commercial real estate:

               

Construction

    8,809       16,235  

Other

    239,613       229,029  

1 – 4 Family residential real estate:

               

Owner occupied

    90,311       90,494  

Non-owner occupied

    19,907       19,370  

Construction

    5,860       9,344  

Consumer

    21,765       21,334  

Subtotal

    563,103       544,473  

Net Deferred loan fees and costs

    (965

)

    (1,612

)

Allowance for loan losses

    (5,767

)

    (5,678

)

Net Loans

  $ 556,371     $ 537,183  

 

The above table includes PPP loans of $68,788 as of September 30, 2020 and $66,606 as of June 30, 2020 in the commercial loan category.

 

The following table presents the activity in the allowance for loan losses by portfolio segment for the three months ended September 30, 2020:

 

                   

1-4 Family

                 
           

Commercial

   

Residential

                 
           

Real

   

Real

                 
   

Commercial

   

Estate

   

Estate

   

Consumer

   

Total

 
                                         

Allowance for loan losses:

                                       

Beginning balance

  $ 947     $ 3,623     $ 989     $ 119     $ 5,678  

Provision for loan losses

    15       70       8       37       130  

Loans charged-off

    (22

)

                (44

)

    (66

)

Recoveries

          1             24       25  

Total ending allowance balance

  $ 940     $ 3,694     $ 997     $ 136     $ 5,767  

 

10

 

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

 

(Dollars in thousands, except per share amounts)

 

The following table presents the activity in the allowance for loan losses by portfolio segment for the three months ended September 30, 2019:

 

                   

1-4 Family

                 
           

Commercial

   

Residential

                 
           

Real

   

Real

                 
   

Commercial

   

Estate

   

Estate

   

Consumer

   

Total

 
                                         

Allowance for loan losses:

                                       

Beginning balance

  $ 660     $ 2,575     $ 494     $ 59     $ 3,788  

Provision for loan losses

    (11

)

    69       56       16       130  

Loans charged-off

                      (16

)

    (16

)

Recoveries

          1             6       7  

Total ending allowance balance

  $ 649     $ 2,645     $ 550     $ 65     $ 3,909  

 

The following table presents the balance in the allowance for loan losses and the recorded investment in loans by portfolio segment and based on impairment method as of September 30, 2020. Included in the recorded investment in loans is $1,759 of accrued interest receivable.

 

                   

1-4 Family

                 
           

Commercial

   

Residential

                 
           

Real

   

Real

                 
   

Commercial

   

Estate

   

Estate

   

Consumer

   

Total

 

Allowance for loan losses:

                                       

Ending allowance balance attributable to loans:

                                       

Individually evaluated for impairment

  $ 3     $ 5     $     $     $ 8  

Acquired loans collectively evaluated for impairment

          103       89             192  

Originated loans collectively evaluated for impairment

    937       3,586       908       136       5,567  

Total ending allowance balance

  $ 940     $ 3,694     $ 997     $ 136     $ 5,767  
                                         

Recorded investment in loans:

                                       

Loans individually evaluated for impairment

  $ 154     $ 1,031     $ 914     $     $ 2,099  

Acquired loans collectively evaluated for impairment

    882       8,097       25,553       10,892       45,424  

Originated loans collectively evaluated for impairment

    175,283       239,667       90,513       10,911       516,374  

Total ending loans balance

  $ 176,319     $ 248,795     $ 116,980     $ 21,803     $ 563,897  

 

11

 

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

 

(Dollars in thousands, except per share amounts)

 

The following table presents the balance in the allowance for loan losses and the recorded investment in loans by portfolio segment and based on impairment method as of June 30, 2020. Included in the recorded investment in loans is $1,936 of accrued interest receivable.

 

                   

1-4 Family

                 
           

Commercial

   

Residential

                 
           

Real

   

Real

                 
   

Commercial

   

Estate

   

Estate

   

Consumer

   

Total

 

Allowance for loan losses:

                                       

Ending allowance balance attributable to loans:

                                       

Individually evaluated for impairment

  $ 28     $ 6     $     $     $ 34  

Acquired loans collectively evaluated for impairment

          103       94             197  

Originated loans collectively evaluated for impairment

    919       3,514       895       119       5,447  

Total ending allowance balance

  $ 947     $ 3,623     $ 989     $ 119     $ 5,678  
                                         

Recorded investment in loans:

                                       

Loans individually evaluated for impairment

  $ 179     $ 1,045     $ 699     $     $ 1,923  

Acquired loans collectively evaluated for impairment

    1,095       8,072       27,252       12,550       48,969  

Originated loans collectively evaluated for impairment

    156,054       236,840       92,168       8,843       493,905  

Total ending loans balance

  $ 157,328     $ 245,957     $ 120,119     $ 21,393     $ 544,797  

 

The following table presents information related to unpaid principal balance, recorded investment and interest income associated with loans individually evaluated for impairment by class of loans as of September 30, 2020 and for the three months ended September 30, 2020:

 

   

As of September 30, 2020

   

Three Months ended September 30, 2020

 
   

Unpaid

           

Allowance

for Loan

   

Average

   

Interest

   

Cash Basis

 
   

Principal

   

Recorded

   

Losses

   

Recorded

   

Income

   

Interest

 
   

Balance

   

Investment

   

Allocated

   

Investment

   

Recognized

   

Recognized

 

With no related allowance recorded:

                                               

Commercial real estate:

                                               

Other

  $ 913     $ 825     $     $ 826     $ 1     $ 1  

1-4 Family residential real estate:

                                               

Owner occupied

    830       689             539       6       6  

Non-owner occupied

    279       225             229              

With an allowance recorded:

                                               

Commercial

    152       154       3       171       2       2  

Commercial real estate:

                                               

Other

    205       206       5       206       3       3  

Total

  $ 2,379     $ 2,099     $ 8     $ 1,971     $ 12     $ 12  

 

12

 

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

 

(Dollars in thousands, except per share amounts)

 

The following table presents information related to unpaid principal balance, recorded investment and interest income associated with loans individually evaluated for impairment by class of loans as of June 30, 2020 and for the three months ended September 30, 2019:

 

   

As of June 30, 2020

   

Three Months ended September 30, 2019

 
   

Unpaid

           

Allowance

for Loan

   

Average

   

Interest

   

Cash Basis

 
   

Principal

   

Recorded

   

Losses

   

Recorded

   

Income

   

Interest

 
   

Balance

   

Investment

   

Allocated

   

Investment

   

Recognized

   

Recognized

 

With no related allowance recorded:

                                               

Commercial real estate:

                                               

Other

  $ 922     $ 836     $     $ 362     $ 86     $ 86  

1-4 Family residential real estate:

                                               

Owner occupied

    604       463             39       7       7  

Non-owner occupied

    284       236             257              

With an allowance recorded:

                                               

Commercial

    176       179       28       170       3       3  

Commercial real estate:

                                               

Other

    209       209       6       220       3       3  

Total

  $ 2,195     $ 1,923     $ 34     $ 1,048     $ 99     $ 99  

 

The following table presents the recorded investment in non-accrual and loans past due over 90 days still on accrual by class of loans as of September 30, 2020 and June 30, 2020:

 

   

September 30, 2020

   

June 30, 2020

 
           

Loans Past Due

           

Loans Past Due

 
           

Over 90 Days

           

Over 90 Days

 
           

Still

           

Still

 
   

Non-accrual

   

Accruing

   

Non-accrual

   

Accruing

 

Commercial

  $     $     $ 21     $  

Commercial real estate:

                               

Other

    774             785        

1 – 4 Family residential:

                               

Owner occupied

    369             143       29  

Non-owner occupied

    226             236        

Consumer

                      12  

Total

  $ 1,369     $     $ 1,185     $ 41  

 

Non-accrual loans and loans past due 90 days still on accrual include both smaller balance homogeneous loans that are collectively evaluated for impairment and individually classified impaired loans.

 

13

 

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

 

(Dollars in thousands, except per share amounts)

 

The following table presents the aging of the recorded investment in past due loans as of September 30, 2020 by class of loans:

 

   

Days Past Due

                         
   

30 - 59

   

60 - 89

   

90 Days or

   

Total

   

Loans Not

         
   

Days

   

Days

   

Greater

   

Past Due

   

Past Due

   

Total

 

Commercial

  $     $     $     $     $ 176,319     $ 176,319  

Commercial real estate:

                                               

Construction

                            8,810       8,810  

Other

                629       629       239,356       239,985  

1-4 Family residential:

                                               

Owner occupied

    234             369       603       90,498       91,101  

Non-owner occupied

                            19,934       19,934  

Construction

                            5,945       5,945  

Consumer

    105       16             121       21,682       21,803  

Total

  $ 339     $ 16     $ 998     $ 1,353     $ 562,544     $ 563,897  

 

The above table of past due loans includes the recorded investment in non-accrual loans of $998 in the 90 days or greater category and $371 in the loans not past due category.

 

The following table presents the aging of the recorded investment in past due loans as of June 30, 2020 by class of loans:

 

   

Days Past Due

                         
   

30 - 59

   

60 - 89

   

90 Days or

   

Total

   

Loans Not

         
   

Days

   

Days

   

Greater

   

Past Due

   

Past Due

   

Total

 

Commercial

  $     $     $ 21     $ 21     $ 157,307     $ 157,328  

Commercial real estate:

                                               

Construction

                            16,241       16,241  

Other

          2       628       630       229,086       229,716  

1-4 Family residential:

                                               

Owner occupied

                172       172       91,102       91,274  

Non-owner occupied

                            19,41