0001140361-21-042794 | 10-K | XBRL Viewer

Note 8. Borrowings

The following table sets forth the contractual maturities and weighted average interest rates of the Company’s fixed rate FHLB advances:

(in thousands)	Balance at September 30, 2021
Contractual Maturity	Amount		Weighted Average Rate
2022	$	4,000		2.02	%
2023		12,040		2.23	%
2024		18,860		0.98	%
2025		7,080		0.58	%
Total	$	41,980		1.37	%

	Balance at September 30, 2020
Contractual Maturity	Amount		Weighted Average Rate
2021	$	34,758		1.67	%
2022		4,000		2.02	%
2023		4,300		1.15	%
2024		18,860		0.98	%
Thereafter		7,080		0.58	%
Total	$	68,998		1.36	%

Each advance is payable at its maturity date, with a prepayment penalty for fixed rate advances. The advances were collateralized by $432.7 million and $143.7 million of residential and commercial mortgage loans under a blanket lien arrangement at September 30, 2021 and 2020, respectively. Based on this collateral and the Company’s holdings of FHLB stock, the Company was eligible to borrow up to an additional total of $35.9 million at September 30, 2021.

At September 30, 2021 and 2020, the Company's borrowings from the Federal Reserve’s Paycheck Protection Liquidity Facility (“PPPLF”) were $117.7 million and $16.2 million, respectively. The borrowings have a rate of 0.35% and the maturity date will equal the maturity date of the underlying PPP loan pledged to secure the extension of credit. The maturity date of a PPP loan is either two or five years from origination date. The Company utilized the PPPLF to fund PPP loan production. The borrowings are fully pledged by PPP loans as of September 30, 2021 and 2020.

On December 29, 2017, the Company obtained a $15.0 million loan from another bank. The rate on the loan was fixed at 5.85% for a term of 9 years. The loan was interest only for the first 4 years and then principal and interest for the remaining term using a 10-year amortization schedule with a balloon payment at maturity. The loan was secured by the Bank’s stock. The Company recorded an immaterial amount of debt issuance costs as of September 30, 2020. The loan was paid off in October 2020.

In October 2020, the Company completed the private placement of $25.0 million in aggregate principal amount of fixed-to-floating rate subordinated notes due 2030 (the “Notes”) to certain qualified institutional buyers and accredited investors. The Notes will initially bear interest, payable semi-annually, at the rate of 5.00% per annum, until October 15, 2025. From and including October 15, 2025, the interest rate applicable to the outstanding principal amount due will reset quarterly to the then current three-month secured overnight financing rate (“SOFR”) plus 487.4 basis points. The Company may, at its option, beginning with the interest payment date of October 15, 2025 but not generally prior thereto, and on any scheduled interest payment date thereafter, redeem the Notes, in whole or in part, subject to the receipt of any required regulatory approval. The Notes are not subject to redemption at the option of the holder. These subordinated notes are included as a component of Tier 1 capital for regulatory reporting.

At September 30, 2021, the unamortized issuance costs of the Notes were $0.5 million. For the year ended September 30, 2021, $0.1 million of issuance costs were recorded in interest expense. The Notes are presented net of unamortized issuance costs in the Company’s Consolidated Balance Sheet.

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

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Fair Value of Assets Received and Liabilities Assumed

Equity Compensation Plans, Restricted Stock (Details) - Restricted Stock [Member] - USD ($) $ / shares in Units, $ in Millions	12 Months Ended
	Sep. 30, 2021	Sep. 30, 2020
Number of Shares [Roll Forward]
Unvested, beginning of period (in shares)	95,052
Granted (in shares)	28,727
Vested (in shares)	(46,112)
Forfeited (in shares)	(1,834)
Unvested, end of period (in shares)	75,833	95,052
Weighted-Average Grant Date Fair Value [Roll Forward]
Unvested, beginning of period (in dollars per share)	$ 19.56
Granted (in dollars per share)	19.88
Vested (in dollars per share)	19.16
Forfeited (in dollars per share)	21.85
Unvested, end of period (in dollars per share)	$ 19.87	$ 19.56
Compensation expenses	$ 0.9	$ 0.8
Unrealized compensation cost	$ 1.1
Weighted-average term for recognizing unrealized compensation cost	1 year 8 months 19 days
Total fair value of shares vested	$ 0.9	$ 0.8
Three-year Vesting Period [Member]
Restricted Stock [Abstract]
Award vesting period	3 years
Number of Shares [Roll Forward]
Granted (in shares)	22,727
Four-year Vesting Period [Member]
Restricted Stock [Abstract]
Award vesting period	4 years
Number of Shares [Roll Forward]
Granted (in shares)	6,000

Business Combinations, Loans Acquired in Savoy Acquisition (Details) - Savoy Bank [Member] $ in Thousands	May 26, 2021 USD ($)
Loans Acquired in Acquisition [Abstract]
Contractually required principal and interest at acquisition	$ 14,416
Contractual cash flows not expected to be collected (non-accretable discount)	(3,467)
Expected cash flows at acquisition	10,949
Interest component of expected cash flows (accretable discount)	(540)
Fair value of acquired purchased credit impaired loans	$ 10,409

Business Combinations (Tables)

12 Months Ended

Sep. 30, 2021

Business Combinations [Abstract]

A preliminary summary of the fair value of assets received and liabilities assumed are as follows:

(in thousands)	As Recorded by Savoy		Fair Value Adjustments				As Recorded by Hanover
Assets
Cash and due from banks	$	59,155	$	-			$	59,155
Investment securities available-for-sale		239		-				239
Loans held for sale		3,883		-				3,883
Loans held for investment		569,251		8,612		(a)		577,863
Premises and equipment, net		234		(22	)	(b)		212
Core deposit intangible		-		490		(c)		490
Accrued interest receivable		5,171		(650	)	(d)		4,521
Other assets		10,432		(2,925	)	(e)		7,507
Total assets acquired	$	648,365	$	5,505				653,870
Liabilities
Deposits	$	340,215	$	2,527		(f)	$	342,742
Borrowings		258,247		301		(g)		258,548
Accrued interest payable		1,050		-				1,050
Other liabilities and accrued expenses		3,817		(342	)	(h)		3,475
Total liabilities assumed	$	603,329	$	2,486				605,815
Net assets acquired								48,055
Total consideration								65,512
Goodwill							$	17,457

(a)

(b)

Represents the fair value adjustments to reflect the fair value of premises and equipment.

(c)

Represents the fair value of core deposit intangible recorded, which will be amortized on an accelerated basis over the estimated average life of the deposit base.

(d)

Represents an adjustment to accrued interest receivable acquired.

(e)

(f)

Represents the fair value adjustments on time deposits, which will be treated as a reduction of interest expense over the remaining term of the time deposits.

(g)

Represents the fair value adjustments on an FHLB borrowing, which will be treated as a reduction to interest expense over the life of the borrowing.

(h)

Represents an adjustment to other liabilities assumed.

Consideration Paid

A summary of total consideration paid is as follows:

(in thousands, except shares)
Common stock issued (1,357,567 shares issued)	$	32,521
Cash payments to common shareholders		32,991
Total consideration paid	$	65,512

Loans Acquired in Savoy Acquisition

The following is a summary of the loans accounted for in accordance with ASC 310-30 that were acquired in the Savoy acquisition as of the merger date:

(in thousands)
Contractually required principal and interest at acquisition	$	14,416
Contractual cash flows not expected to be collected (non-accretable discount)		(3,467	)
Expected cash flows at acquisition		10,949
Interest component of expected cash flows (accretable discount)		(540	)
Fair value of acquired purchased credit impaired loans	$	10,409

Unaudited Pro Forma Information

			Pro-Forma for Year Ended September 30,
(in thousands, except share and per share data)	Actual from Acquisition Date through September 30, 2021		2021		2020
Net interest income	$	20,736	$	54,841	$	48,555
Non-interest income		2,171		10,803		5,785
Net income		7,420		24,173		12,770

Pro-forma earnings per share:
Basic	$	1.33	$	4.35	$	2.31
Diluted	$	1.31	$	4.28	$	2.29

Weighted average shares outstanding:
Basic		5,558,008		5,561,449		5,519,847
Diluted		5,643,529		5,651,109		5,584,534

Income Taxes, Components of Income Tax Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2021	Sep. 30, 2020
Current [Abstract]
Federal	$ 2,594	$ 1,303
State	242	116
Total current	2,836	1,419
Deferred [Abstract]
Federal	394	91
State	(383)	(1,200)
Total deferred	11	(1,109)
Change in valuation allowance	354	930
Total income tax expense	$ 3,201	$ 1,240

Investment Securities

12 Months Ended

Sep. 30, 2021

Investment Securities [Abstract]

Investment Securities

Note 3. Investment Securities

The following table summarizes the amortized cost and fair value of securities available for sale and securities held to maturity at September 30, 2021 and 2020 and the corresponding amounts of gross unrealized gains and losses recognized in accumulated other comprehensive income:

	September 30, 2021
(in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Available-for-sale:
U.S. GSE residential mortgage-backed securities	$	722	$	112	$	(1	)	$	833
Corporate bonds		6,700		214		-			6,914
Total available-for-sale	$	7,422	$	326	$	(1	)	$	7,747

Held-to-maturity:
U.S. GSE residential mortgage-backed securities	$	2,417	$	74	$	-		$	2,491
U.S. GSE commercial mortgage-backed securities		2,694		175		-			2,869
Corporate bonds		3,500		9		(4	)		3,505
Total held-to-maturity		8,611		258		(4	)		8,865
Total securities	$	16,033	$	584	$	(5	)	$	16,612

	September 30, 2020
(in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
Available-for-sale:
U.S. GSE residential mortgage-backed securities	$	838	$	124	$	-	$	962
Corporate bonds		5,000		73		-		5,073
Total available-for-sale	$	5,838	$	197	$	-	$	6,035

Held-to-maturity:
U.S. GSE residential mortgage-backed securities	$	4,478	$	118	$	-	$	4,596
U.S. GSE commercial mortgage-backed securities		2,749		253		-		3,002
Corporate bonds		3,500		33		-		3,533
Total held-to-maturity		10,727		404		-		11,131
Total securities	$	16,565	$	601	$	-	$	17,166

The amortized cost and estimated fair value of investment securities at September 30, 2021, by contractual maturity, are shown below. The expected life of mortgage-backed securities will differ from contractual maturities because borrowers may have the right to call or prepay the underlying mortgage loans with or without call or prepayment penalties.

	September 30, 2021
(in thousands)	Amortized Cost		Fair Value
Available-for-sale:
Due in one year or less	$	-	$	-
Due after one year through five years		-		-
Due after five years through ten years		6,700		6,914
Due after ten years		-		-
Residential mortgage-backed securities		722		833
Total available-for-sale	$	7,422	$	7,747

Held-to-maturity:
Due in one year or less	$	-	$	-
Due after one year through five years		1,500		1,496
Due after five years through ten years		2,000		2,009
Due after ten years		-		-
Residential mortgage-backed securities		2,417		2,491
Commercial mortgage-backed securities		2,694		2,869
Total held-to-maturity	$	8,611	$	8,865

At September 30, 2021 and 2020, respectively, investment securities with an estimated fair value of approximately $5.1 million and $5.6 million were pledged to secure public deposits and for other purposes required or permitted by law.

There were no holdings of securities of any one issuer in an amount greater than 10% of stockholders’ equity at September 30, 2021. At September 30, 2020, securities issued by U.S. Government sponsored agencies exceeded 10% of stockholders’ equity.

The following table presents a summary of realized gains and losses from the sale of investment securities:

	Year Ended September 30,
(in thousands)	2021		2020
Proceeds from sales	$	3,240	$	-
Gross realized gains on sales	$	240	$	-
Gross realized losses on sales		-		-
Total realized gains, net⁽¹⁾	$	240	$	-

(1) Amount does not include associated income tax of $49 for year ended September 30, 2021

The following tables detail gross unrealized losses and fair values of investment securities aggregated by investment category and length of time that the individual securities have been in a continuous unrealized loss position at September 30, 2021. There were no securities with gross unrealized losses at September 30, 2020.

	Less than Twelve Months					Twelve Months or Longer				Total
(in thousands, except number of securities)	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses		Number of Securities		Fair Value		Gross Unrealized Losses
Available-for-sale:
U.S. GSE residential mortgage-backed securities	$	143	$	(1	)	$	-	$	-		6	$	143	$	(1	)
Total available-for-sale	$	143	$	(1	)	$	-	$	-		6	$	143	$	(1	)

Held-to-maturity:
Corporate bonds	$	1,496	$	(4	)	$	-	$	-		1	$	1,496	$	(4	)
Total held-to-maturity	$	1,496	$	(4	)	$	-	$	-		1	$	1,496	$	(4	)

Investment Securities, Gross Unrealized Losses and Fair Values of Investment Securities (Details) $ in Thousands	Sep. 30, 2021 USD ($) Security	Sep. 30, 2020 USD ($)
Available for sale [Abstract]
Less than 12 months, Fair value	$ 143
Less than 12 months, Gross unrealized losses	(1)
12 months or longer, Fair value	0
12 months or longer, Gross unrealized losses	$ 0
Number of securities \| Security	6
Total, Fair value	$ 143
Total, Gross unrealized losses	(1)	$ 0
Held to maturity [Abstract]
Less than 12 months, Fair value	1,496
Less than 12 months, Gross unrealized losses	(4)
12 months or longer, Fair value	0
12 months or longer, Gross unrealized losses	$ 0
Number of securities \| Security	1
Total, Fair value	$ 1,496
Total, Gross unrealized losses	(4)	$ 0
U.S. GSE Securities [Member] \| Residential Mortgage Backed Securities [Member]
Available for sale [Abstract]
Less than 12 months, Fair value	143
Less than 12 months, Gross unrealized losses	(1)
12 months or longer, Fair value	0
12 months or longer, Gross unrealized losses	0
Total, Fair value	143
Total, Gross unrealized losses	(1)
Corporate Bonds [Member]
Held to maturity [Abstract]
Less than 12 months, Fair value	1,496
Less than 12 months, Gross unrealized losses	(4)
12 months or longer, Fair value	0
12 months or longer, Gross unrealized losses	$ 0
Number of securities \| Security	1
Total, Fair value	$ 1,496
Total, Gross unrealized losses	$ (4)

Equity Compensation Plans

12 Months Ended

Sep. 30, 2021

Equity Compensation Plans [Abstract]

Equity Compensation Plans

Note 11. Equity Compensation Plans

The Company’s 2021 and 2018 Equity Compensation Plans (“the 2021 Plan” and “the 2018 Plan”, respectively), provide for the grant of stock-based compensation awards to members of management, including employees and management officials, including members of the Board. Under the 2021 Plan, a total of 427,500 shares of the Company’s common stock or equivalents were approved for issuance, of which 427,500 shares remain available for issuance at September 30, 2021. Of the total 346,000 shares of common stock approved for issuance under the 2018 Plan, 195,848 shares remain available for issuance at September 30, 2021. Hanover assumed the 2013 Savoy Bank Stock Option Plan solely in connection with options to purchase Savoy common stock held by the former Chief Executive Officer of Savoy and which, under the terms of the Agreement and Plan of Merger between the Company and Savoy, were converted into options to purchase 71,900 shares of Hanover common stock.

Stock Options

Stock options are granted with an exercise price equal to the fair market value of the Company’s common stock at the date of grant, and generally with vesting periods of three years and contractual terms of ten years. All stock options fully vest upon a change in control.

The fair value of stock options is estimated on the date of grant using a closed form option valuation (Black-Scholes) model. Expected volatilities are based on historical volatilities of the common stock of the Company’s peers. The Company uses historical data to estimate option exercise and post-vesting termination behavior. Expected terms are based on historical data and represent the periods in which the options are expected to be outstanding. The risk-free interest rate for the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of grant.

A summary of stock option activity follows (aggregate intrinsic value in thousands):

	Number of Options		Weighted Average Exercise Price		Aggregate Intrinsic Value		Weighted Average Remaining Contractual Term
Outstanding, October 1, 2020		155,506	$	11.35	$	1,623	4.66 years
Converted in Savoy acquisition		71,900		5.51
Exercised		-		-
Forfeited		-		-
Outstanding, September 30, 2021 ⁽¹⁾		227,406	$	9.50	$	2,043	3.51 years

⁽¹⁾ All outstanding options are fully vested and exercisable

In connection with the Savoy Bank acquisition, the Company assumed fully vested legacy Savoy stock options held by the former Chief Executive Officer of Savoy which were converted into options to purchase 71,900 shares of Hanover common stock at a weighted average exercise price of $5.51 per share and fair value of $17.65 per share.

The Company recorded an immaterial amount of compensation expense attributable to stock options for the years ended September 30, 2021 and 2020, respectively.

Restricted Stock

During the year ended September 30, 2021, restricted stock awards of 22,727 shares were granted with a three-year vesting period and 6,000 shares were granted with a four-year vesting period. Compensation expense is recognized over the vesting period of the awards based on the fair value of the stock at issue date. Since there is no active market for the Company’s stock, the fair value of the restricted stock awards was estimated on the date of grant based on the prices of the most recent transactions in the Company’s common stock.

A summary of restricted stock activity follows:

	Shares			Weighted Average Grant Date Fair Value
Unvested, October 1, 2020		95,052		$	19.56
Granted		28,727			19.88
Vested		(46,112	)		19.16
Forfeited		(1,834	)		21.85
Unvested, September 30, 2021		75,833			19.87

Compensation expense attributable to restricted stock was $0.9 million and $0.8 million for the years ended September 30, 2021 and 2020, respectively. As of September 30, 2021, there was $1.1 million of total unrealized compensation cost related to unvested restricted stock, expected to be recognized over a weighted-average term of 1.72 years. The total fair value of shares vested during the years ended September 30, 2021 and 2020 was $0.9 million and $0.8 million, respectively.

Commitments and Contingent Liabilities, Future Minimum Rental Commitments Non-Cancelable Operating Leases (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2021	Sep. 30, 2020
Non-Cancelable Operating Leases [Abstract]
2022	$ 1,886
2023	1,921
2024	1,948
2025	1,951
2026	1,621
Thereafter	4,729
Total	14,056
Leases [Abstract]
Rent expense	$ 1,700	$ 1,600

Regulatory Matters

12 Months Ended

Sep. 30, 2021

Regulatory Matters [Abstract]

Regulatory Matters

Note 14. Regulatory Matters

The Bank is subject to various regulatory capital requirements administered by federal banking agencies. Capital adequacy guidelines and, additionally for banks, prompt corrective action regulations, involve quantitative measures of assets, liabilities, and certain off-balance sheet items calculated under regulatory accounting practices. Capital amounts and classifications are also subject to qualitative judgments by regulators, Failure to meet minimum capital requirements can initiate regulatory action. The net unrealized gain or loss on available for sale securities is not included in computing regulatory capital. Management believes as of September 30, 2021, the Bank meets all capital adequacy requirements to which it is subject.

Prompt corrective action regulations provide five classifications: well capitalized, adequately capitalized, undercapitalized, significantly undercapitalized, and critically undercapitalized, although these terms are not used to represent overall financial condition. If adequately capitalized, regulatory approval is required to accept brokered deposits. If undercapitalized, capital distributions are limited, as is asset growth and expansion, and capital restoration plans are required. At year-end 2021 and 2020, the most recent regulatory notifications categorized the Bank as well capitalized under the regulatory framework for prompt corrective action. There are no conditions or events since that notification that management believes have changed the institution’s category.

The following table sets forth the Bank’s actual capital amounts and ratios under current regulations:

	September 30, 2021
	Actual Capital					Minimum Capital Adequacy Requirement					Minimum Capital Adequacy Requirement with Capital Conservation Buffer					Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions
(in thousands)	Amount		Ratio			Amount		Ratio			Amount		Ratio			Amount		Ratio
Total capital to risk-weighted assets	$	132,554		15.59	%	$	68,040		8.00	%	$	89,303		10.50	%	$	85,050		10.00	%
Tier 1 capital to risk-weighted assets		123,666		14.54			51,030		6.00			72,293		8.50			68,040		8.00
Common equity tier 1 capital to risk-weighted assets		123,666		14.54			38,273		4.50			59,535		7.00			55,283		6.50
Tier 1 capital to average total assets		123,666		9.45			52,338		4.00			N/A		N/A			65,423		5.00

	September 30, 2020
	Actual Capital					Minimum Capital Adequacy Requirement					Minimum Capital Adequacy Requirement with Capital Conservation Buffer					Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions
(in thousands)	Amount		Ratio			Amount		Ratio			Amount		Ratio			Amount		Ratio
Total capital to risk-weighted assets	$	95,079		20.57	%	$	36,970		8.00	%	$	48,523		10.50	%	$	46,212		10.00	%
Tier 1 capital to risk-weighted assets		89,275		19.32			27,727		6.00			39,281		8.50			36,970		8.00
Common equity tier 1 capital to risk-weighted assets		89,275		19.32			20,796		4.50			32,349		7.00			30,038		6.50
Tier 1 capital to average total assets		89,275		11.22			31,820		4.00			N/A		N/A			39,775		5.00

Due to a FRB policy applicable to bank holding companies with less than $3.0 billion in consolidated assets, the Company is not subject to any consolidated regulatory capital requirements.

Dividend restrictions - The Company’s principal source of funds for dividend payments is dividends received from the Bank. Banking regulations limit the amount of dividends that may be paid without prior approval of regulatory agencies. As of September 30, 2021, $28.4 million of retained earnings is available to pay dividends.

The entire disclosure for regulatory capital requirement for depository and lending institutions. Institutions include, but not are not limited to, finance company, insured depository institution, bank holding company, savings and loan association holding company, bank and savings institution not federally insured, mortgage company, foreign financial institution and credit union.

Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Sep. 30, 2021	Sep. 30, 2020
Earnings Per Share [Abstract]
Net income	$ 10,851	$ 4,974
Weighted-average common shares - basic (in shares)	4,669,009	4,162,280
Add: Dilutive effect of stock options (in shares)	89,660	64,687
Weighted-average common shares - diluted (in shares)	4,758,669	4,226,967
Basic earnings per share (in dollars per share)	$ 2.32	$ 1.20
Diluted earnings per share (in dollars per share)	$ 2.28	$ 1.18
Antidilutive stock options (in shares)	0	0

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

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The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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Assets Measured at Fair Value on Recurring Basis

Fair Value Measurements (Tables)

12 Months Ended

Sep. 30, 2021

Fair Value Measurements [Abstract]

The following table summarizes assets measured at fair value on a recurring basis:

	September 30, 2021
			Fair Value Measurements Using:
(in thousands)	Carrying Amount		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial assets:
Available-for-sale securities:
U.S. GSE residential mortgage-backed securities	$	833	$	-	$	833	$	-
Corporate bonds		6,914		-		6,914		-
Mortgage servicing rights		3,690		-		-		3,690
Total	$	11,437	$	-	$	7,747	$	3,690

	September 30, 2020
			Fair Value Measurements Using:
(in thousands)	Carrying Amount		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial assets:
Available-for-sale securities:
U.S. GSE residential mortgage-backed securities	$	962	$	-	$	962	$	-
Corporate bonds		5,073		-		5,073		-
Mortgage servicing rights		155		-		-		155
Total	$	6,190	$	-	$	6,035	$	155

Changes in Mortgage Servicing Rights

The following table presents the changes in mortgage servicing rights for the periods presented:

	Year Ended September 30,
(in thousands)	2021			2020
Beginning balance	$	155		$	266
Loan servicing rights obtained from acquisition of Savoy		3,777			-
Additions		10			-
Adjustment to fair value		(252	)		(111	)
Ending balance	$	3,690		$	155

Carrying Amounts and Fair Value of Financial Instruments

The following table presents the carrying amount and the fair value of the Company’s financial instruments which are carried at cost and not measured or recorded at fair value at September 30, 2021 and 2020:

	September 30, 2021
			Fair Value Measurements Using:
(in thousands)	Carrying Amount		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Fair Value
Financial assets:
Cash and cash equivalents	$	166,544	$	166,544	$	-	$	-	$	166,544
Securities held-to-maturity		8,611		-		8,865		-		8,865
Securities available-for-sale		7,747		-		7,747		-		7,747
Federal Home Loan Bank stock		3,714		N/A		N/A		N/A		N/A
Loans, net		1,238,573		-		-		1,278,056		1,278,056
Accrued interest receivable		9,363		-		211		9,152		9,363

Financial Liabilities:
Time deposits		377,836		-		378,333		-		378,333
Demand and other deposits		786,826		786,826		-		-		786,826
Borrowings		159,642		-		159,608		-		159,608
Subordinated debentures		24,513		-		27,092		-		27,092
Accrued interest payable		1,290		1		713		576		1,290

	September 30, 2020
			Fair Value Measurements Using:
(in thousands)	Carrying Amount		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Fair Value
Financial assets:
Cash and cash equivalents	$	80,209	$	80,209	$	-	$	-	$	80,209
Securities held-to-maturity		10,727		-		11,131		-		11,131
Securities available-for-sale		6,035		-		6,035		-		6,035
Federal Home Loan Bank stock		4,170		N/A		N/A		N/A		N/A
Loans, net		717,150		-		-		746,969		746,969
Accrued interest receivable		6,766		-		218		6,548		6,766

Financial Liabilities:
Time deposits		394,753		-		397,842		-		397,842
Demand and other deposits		270,007		270,007		-		-		270,007
Borrowings		85,154		-		87,052		-		87,052
Note payable		14,984		-		-		15,329		15,329
Accrued interest payable		374		1		339		34		374

Fair Value Measurements

12 Months Ended

Sep. 30, 2021

Fair Value Measurements [Abstract]

Fair Value Measurements

Note 15. Fair Value Measurements

FASB ASC No. 820-10 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value is best determined using quoted market prices. However, in many instances, quoted market prices are not available. In such instances, fair values are determined using appropriate valuation techniques. Various assumptions and observable inputs must be relied upon in applying these techniques. Accordingly, categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. As such, the fair value estimates may not be realized in an immediate transfer of the respective asset or liability.

FASB ASC 820-10 also establishes a fair value hierarchy and describes three levels of inputs that may be used to measure fair values: The three levels within the fair value hierarchy are as follows:

•

Level 1: Valuation is based upon unadjusted quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date.

•

Level 2: Fair value is calculated using significant inputs other than quoted market prices that are directly or indirectly observable for the asset or liability. The valuation may rely on quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in inactive markets, inputs other than quoted prices that are observable for the asset or liability (such as interest rates, rate volatility, prepayment speeds, credit ratings,) or inputs that are derived principally or corroborated by market data, by correlation, or other means.

•

Level 3: Inputs for determining the fair value of the respective assets or liabilities are not observable. Level 3 valuations are reliant upon pricing models and techniques that require significant management judgment or estimation.

Fair value estimates are made at a specific point in time, based on relevant market information and information about the financial instrument. These estimates do not reflect any premium or discount that could result from offering for sale at one time the Company’s entire holdings of a particular financial instrument. Because no market exists for a significant portion of the Company’s financial instruments, fair value estimates are based on judgments regarding future expected loss experience, current economic conditions, risk characteristics of various financial instruments, and other factors. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates.

Fair value estimates are based on existing on- and off-balance-sheet financial instruments without attempting to estimate the value of anticipated future business and the value of assets and liabilities that are not considered financial instruments. In addition, the tax ramifications related to the realization of the unrealized gains and losses can have a significant effect on fair value estimates and have not been considered in the estimates.

Assets Measured at Fair Value on a Recurring Basis

The following table summarizes assets measured at fair value on a recurring basis:

	September 30, 2021
			Fair Value Measurements Using:
(in thousands)	Carrying Amount		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial assets:
Available-for-sale securities:
U.S. GSE residential mortgage-backed securities	$	833	$	-	$	833	$	-
Corporate bonds		6,914		-		6,914		-
Mortgage servicing rights		3,690		-		-		3,690
Total	$	11,437	$	-	$	7,747	$	3,690

	September 30, 2020
			Fair Value Measurements Using:
(in thousands)	Carrying Amount		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial assets:
Available-for-sale securities:
U.S. GSE residential mortgage-backed securities	$	962	$	-	$	962	$	-
Corporate bonds		5,073		-		5,073		-
Mortgage servicing rights		155		-		-		155
Total	$	6,190	$	-	$	6,035	$	155

The fair value for the securities available-for-sale were obtained from an independent broker based upon matrix pricing, which is a mathematical technique widely used in the industry to value debt securities without relying exclusively on quoted prices for the specific securities but rather by relying on the securities’ relationship to other benchmark quoted securities. The Company has determined these are classified as Level 2 inputs within the fair value hierarchy.

The fair value of mortgage servicing rights are based on a valuation model that calculates the present value of estimated future servicing income. The valuation model utilizes interest rate, prepayment speed, and default rate assumptions that market participants would use in estimating future net servicing income. Fair value of loan servicing rights related to residential mortgage loans at September 30, 2021 was determined based on discounted expected future cash flows using discount rates ranging from 12.0% to 14.5%, prepayment speeds ranging from 24.18% to 24.33% and a weighted average life ranging from 1.96 to 3.3 years. Fair value at September 30, 2020 for mortgage servicing rights was determined based on discounted expected future cash flows using discount rates ranging from 12.0% to 14.5%, prepayment speeds ranging from 23.84% to 23.95% and a weighted average life ranging from 2.5 to 3.3 years.

The fair value of loan servicing rights for SBA loans at September 30, 2021 was determined based on discounted expected future cash flows using discount rates ranging from 4.64% to 21.81%, prepayment speeds ranging from 11.87% to 26.26% and a weighted average life ranging from 0.39 to 5.85 years.

The Company has determined these are mostly unobservable inputs and considers then Level 3 inputs within the fair value hierarchy.

The following table presents the changes in mortgage servicing rights for the periods presented:

	Year Ended September 30,
(in thousands)	2021			2020
Beginning balance	$	155		$	266
Loan servicing rights obtained from acquisition of Savoy		3,777			-
Additions		10			-
Adjustment to fair value		(252	)		(111	)
Ending balance	$	3,690		$	155

Assets Measured at Fair Value on a Non-recurring Basis

There were no assets or liabilities measured at fair value on a non-recurring basis as of September 30, 2021 and 2020 and for the years then ended.

Disclosures about Fair Value of Financial Instruments

	September 30, 2021
			Fair Value Measurements Using:
(in thousands)	Carrying Amount		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Fair Value
Financial assets:
Cash and cash equivalents	$	166,544	$	166,544	$	-	$	-	$	166,544
Securities held-to-maturity		8,611		-		8,865		-		8,865
Securities available-for-sale		7,747		-		7,747		-		7,747
Federal Home Loan Bank stock		3,714		N/A		N/A		N/A		N/A
Loans, net		1,238,573		-		-		1,278,056		1,278,056
Accrued interest receivable		9,363		-		211		9,152		9,363

Financial Liabilities:
Time deposits		377,836		-		378,333		-		378,333
Demand and other deposits		786,826		786,826		-		-		786,826
Borrowings		159,642		-		159,608		-		159,608
Subordinated debentures		24,513		-		27,092		-		27,092
Accrued interest payable		1,290		1		713		576		1,290

	September 30, 2020
			Fair Value Measurements Using:
(in thousands)	Carrying Amount		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Fair Value
Financial assets:
Cash and cash equivalents	$	80,209	$	80,209	$	-	$	-	$	80,209
Securities held-to-maturity		10,727		-		11,131		-		11,131
Securities available-for-sale		6,035		-		6,035		-		6,035
Federal Home Loan Bank stock		4,170		N/A		N/A		N/A		N/A
Loans, net		717,150		-		-		746,969		746,969
Accrued interest receivable		6,766		-		218		6,548		6,766

Financial Liabilities:
Time deposits		394,753		-		397,842		-		397,842
Demand and other deposits		270,007		270,007		-		-		270,007
Borrowings		85,154		-		87,052		-		87,052
Note payable		14,984		-		-		15,329		15,329
Accrued interest payable		374		1		339		34		374

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

Borrowings (Details) - USD ($) $ in Thousands	12 Months Ended
Borrowings (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Oct. 31, 2020	Sep. 30, 2020	Dec. 29, 2017
Contractual Maturities of FHLB Advances [Abstract]
2022/2021	$ 4,000		$ 34,758
2023/2022	12,040		4,000
2024/2023	18,860		4,300
2025/2024	7,080		18,860
Thereafter			7,080
FHLB advances	$ 41,980		$ 68,998
Weighted Average Interest Rates of FHLB Advances [Abstract]
2022/2021	2.02%		1.67%
2023/2022	2.23%		2.02%
2024/2023	0.98%		1.15%
2025/2024	0.58%		0.98%
Thereafter			0.58%
Weighted average rate	1.37%		1.36%
Borrowings [Abstract]
Additional eligible borrowings from FHLB	$ 35,900
Borrowings	159,642		$ 85,154
Subordinated Notes [Member]
Borrowings [Abstract]
Unamortized debt issuance costs	500
Debt issuance costs	$ 100
Private Placement [Member] \| Subordinated Notes [Member]
Borrowings [Abstract]
Aggregate principal amount		$ 25,000
Debt instrument, maturity date	Dec. 31, 2030
Private Placement [Member] \| Subordinated Notes [Member] \| Until October 15, 2025 [Member]
Borrowings [Abstract]
Borrowing rate of interest		5.00%
Private Placement [Member] \| Subordinated Notes [Member] \| From and Including October 15, 2025 [Member] \| Secured Overnight Financing Rate [Member]
Borrowings [Abstract]
Basis spread on variable rate	4.874%
Term of variable rate	3 months
PPPLF [Member]
Borrowings [Abstract]
Borrowings	$ 117,700		16,200
Borrowing rate of interest	0.35%
PPP Loans [Member] \| Minimum [Member]
Borrowings [Abstract]
Debt instrument, term	2 years
PPP Loans [Member] \| Maximum [Member]
Borrowings [Abstract]
Debt instrument, term	5 years
Bank Holding Company Loan [Member]
Borrowings [Abstract]
Maximum borrowing capacity				$ 15,000
Borrowing rate of interest				5.85%
Debt instrument, term	9 years
Interest only payments period	4 years
Principal and interest payments period	10 years
Residential and Commercial Mortgage Loans [Member]
Borrowings [Abstract]
Amount of collateral pledged	$ 432,700		$ 143,700

Document and Entity Information - USD ($)	12 Months Ended
Document and Entity Information - USD ($)	Sep. 30, 2021	Dec. 20, 2021	Mar. 31, 2021
Cover [Abstract]
Document Type	10-K
Amendment Flag	false
Document Annual Report	true
Document Period End Date	Sep. 30, 2021
Current Fiscal Year End Date	--09-30
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	FY
Document Transition Report	false
Entity File Number	333-252262
Entity Registrant Name	Hanover Bancorp, Inc. /NY
Entity Central Index Key	0001828588
Entity Incorporation, State or Country Code	NY
Entity Tax Identification Number	81-3324480
Entity Address, Address Line One	80 East Jericho Turnpike
Entity Address, City or Town	Mineola
Entity Address, State or Province	NY
Entity Address, Postal Zip Code	11501
City Area Code	516
Local Phone Number	548-8500
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
ICFR Auditor Attestation Flag	false
Entity Shell Company	false
Entity Public Float			$ 69,490,146
Entity Common Stock, Shares Outstanding		5,562,923

Earnings Per Share

12 Months Ended

Sep. 30, 2021

Earnings Per Share [Abstract]

Earnings Per Share

Note 17. Earnings Per Share

Basic earnings per common share is computed using the weighted average number of common shares and participating securities outstanding during the reporting period. Diluted earnings per common share is the amount of earnings available to each share of common stock during the reporting period adjusted to include the effect of potentially dilutive common shares. Potentially dilutive common shares include incremental shares issued for stock options. Potentially dilutive common shares are excluded from the computation of dilutive earnings per share in the periods in which the effect would be anti-dilutive.

The Company's basic and diluted earnings per share calculations are presented in the following table:

	Year Ended September 30,
(in thousands, except share and per share data)	2021		2020
Net income	$	10,851	$	4,974

Weighted-average common shares - basic		4,669,009		4,162,280
Add: Dilutive effect of stock options		89,660		64,687
Weighted-average common shares - diluted		4,758,669		4,226,967

Basic earnings per share	$	2.32	$	1.20
Diluted earnings per share	$	2.28	$	1.18

There were no stock options that were antidilutive at September 30, 2021 and 2020.

Business Combinations, Unaudited Pro Forma Information (Details) - Savoy Bank [Member] - USD ($) $ / shares in Units, $ in Thousands	4 Months Ended	12 Months Ended
	Sep. 30, 2021	Sep. 30, 2021	Sep. 30, 2020
Supplemental Unaudited Pro Forma Financial Information [Abstract]
Net interest income	$ 20,736	$ 54,841	$ 48,555
Non-interest income	2,171	10,803	5,785
Net income	$ 7,420	$ 24,173	$ 12,770
Pro-forma earnings per share [Abstract]
Basic (in dollars per share)	$ 1.33	$ 4.35	$ 2.31
Diluted (in dollars per share)	$ 1.31	$ 4.28	$ 2.29
Weighted average shares outstanding [Abstract]
Basic (in shares)	5,558,008	5,561,449	5,519,847
Diluted (in shares)	5,643,529	5,651,109	5,584,534

Loans, Aging of Recorded Investment in Past Due and Non-accrual Loans by Portfolio Segment (Details) - USD ($)
$ in Thousands

Sep. 30, 2021

Sep. 30, 2020

$ 7,028

$ 953

^[1]

10,241

15,241

5,756

30-59 Days Past Due [Member]

1,247,125

725,019

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

60-89 Days Past Due [Member]

6,612

4,507

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

Greater than 89 Days Past Due [Member]

1,601

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

296

Current [Member]

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

1,221,643

719,263

Residential [Member]

Residential [Member] | Real Estate Loans [Member]

444,140

453,760

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

5,554

^[2]

538

^[1]

8,187

5,045

Residential [Member] | Real Estate Loans [Member] | 30-59 Days Past Due [Member]

444,140

453,760

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

Residential [Member] | Real Estate Loans [Member] | 60-89 Days Past Due [Member]

1,032

4,507

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

1,601

Residential [Member] | Real Estate Loans [Member] | Greater than 89 Days Past Due [Member]

1,026

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

Residential [Member] | Real Estate Loans [Member] | Current [Member]

4,528

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

435,953

448,715

Multi-Family [Member]

Multi-Family [Member] | Real Estate Loans [Member]

266,714

136,737

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

458

^[3]

^[1]

458

Multi-Family [Member] | Real Estate Loans [Member] | 30-59 Days Past Due [Member]

266,714

136,737

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

Multi-Family [Member] | Real Estate Loans [Member] | 60-89 Days Past Due [Member]

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

Multi-Family [Member] | Real Estate Loans [Member] | Greater than 89 Days Past Due [Member]

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

Multi-Family [Member] | Real Estate Loans [Member] | Current [Member]

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

266,256

136,690

Commercial [Member]

8,324

Commercial [Member] | Real Estate Loans [Member]

348,807

113,758

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

1,016

^[4]

^[1]

8,324

2,955

330

Commercial [Member] | Real Estate Loans [Member] | 30-59 Days Past Due [Member]

348,807

113,758

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

Commercial [Member] | Real Estate Loans [Member] | 60-89 Days Past Due [Member]

1,939

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

Commercial [Member] | Real Estate Loans [Member] | Greater than 89 Days Past Due [Member]

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

Commercial [Member] | Real Estate Loans [Member] | Current [Member]

296

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

Commercial and Industrial [Member]

337,528

113,428

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

334

^[1]

1,917

3,641

334

Commercial and Industrial [Member] | 30-59 Days Past Due [Member]

172,077

20,738

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

Commercial and Industrial [Member] | 60-89 Days Past Due [Member]

3,641

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

Commercial and Industrial [Member] | Greater than 89 Days Past Due [Member]

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

Commercial and Industrial [Member] | Current [Member]

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

166,519

20,404

Construction [Member]

Construction [Member] | 30-59 Days Past Due [Member]

15,374

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

Construction [Member] | 60-89 Days Past Due [Member]

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

Construction [Member] | Greater than 89 Days Past Due [Member]

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

Construction [Member] | Current [Member]

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

15,374

Consumer [Member]

^[1]

Consumer [Member] | 30-59 Days Past Due [Member]

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

Consumer [Member] | 60-89 Days Past Due [Member]

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

Consumer [Member] | Greater than 89 Days Past Due [Member]

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

Consumer [Member] | Current [Member]

Aging of Recorded Investment in Past Due and Non-accrual Loans [Abstract]

Summary of Significant Accounting Policies [Abstract]

$ 13

$ 26

[1]	Non-accrual loans at September 30, 2020 were greater than 89 days past due.
[2]	Of the residential real estate non-accrual loans, $1,026 were 61 days past due and $4,528 were greater than 89 days past due.
[3]	Multi-family non-accrual loans at September 30, 2021 were greater than 89 days past due.
[4]	Commercial real estate non-accrual loans at September 30, 2021 were greater than 89 days past due.

Summary of Significant Accounting Policies

12 Months Ended

Sep. 30, 2021

Summary of Significant Accounting Policies

Note 1. Summary of Significant Accounting Policies

Nature of Operations

Hanover Bancorp, Inc. (the “Company”) is a New York corporation which became the holding company for Hanover Community Bank (the “Bank”) in 2016. The Bank, headquartered in Mineola, New York, is a New York State chartered bank. The Bank commenced operations on November 4, 2008 and is a full-service bank providing personal and business lending and deposit services. As a New York State chartered, non-Federal Reserve member bank, the Bank is subject to regulation by the New York State Department of Financial Services (“DFS”) and the Federal Deposit Insurance Corporation. The Company is subject to regulation and examination by the Board of Governors of the FRB.

Basis of Presentation

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary. All significant intercompany accounts and transactions have been eliminated in consolidation.

Certain prior period amounts have been reclassified to conform to the current year's presentation. These reclassifications had an immaterial effect on the Company's consolidated financial statements.

Use of Estimates

In preparing the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the balance sheet and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Risks and Uncertainties

In March 2020, the World Health Organization declared the outbreak of COVID-19 a global pandemic. The COVID-19 pandemic has adversely affected, local, national and global economic activity. Various actions taken to help mitigate the spread of COVID-19 included restrictions on travel, quarantines and government mandated closures of various businesses. The outbreak caused significant disruptions to the economy and disrupted banking and other financial activity in the areas in which the Company operates.

The CARES Act was enacted in March 2020 to, among other things, provide emergency assistance to individuals, families and businesses affected by the COVID-19 pandemic. The effects of the COVID-19 pandemic may materially and adversely affect the Company’s financial condition and results of operations in future periods, and it is unknown what the complete financial impact will be to the Company. The extent of such impact will depend on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge concerning the coronavirus, the new “waves” of COVID-19 infections and the distribution of vaccines and vaccination rates, among others. It is possible that estimates made in the financial statements could be materially and adversely impacted due to these conditions.

Significant Group Concentrations of Credit Risk

Most of the Company's activities are with customers located in Nassau, Queens and Kings Counties and surrounding areas of New York State. Note 4 discusses the types of lending that the Company engages in. Although the Company has a diversified loan portfolio, its debtors' ability to honor their contracts is influenced by the region's economy. The Company does not have any significant concentrations to any one industry or customer.

Business Combinations

The Company accounts for its business combinations using the acquisition method of accounting. This method requires the use of fair values in determining the carrying values of the purchased assets and assumed liabilities, which are recorded at fair value at acquisition date, and identifiable intangible assets are recorded at fair value. Costs directly related to the business combinations are recorded as expenses as they are incurred. Fair values are subject to adjustment for up to one year after the closing date of an acquisition as additional information relative to closing date fair values become available.

Cash and Cash Equivalents

For purposes of reporting consolidated cash flows, cash and due from banks includes cash on hand, cash items in process of collection and amounts due from banks. Cash and cash equivalents also include interest-bearing deposits in banks and federal funds sold. Interest-bearing deposits in other financial institutions mature within 90 days and are carried at cost.

Restrictions on Cash

Cash on hand or on deposit with the Federal Reserve Bank was required to meet regulatory reserve and clearing requirements.

Investment Securities

Investment securities are classified as held-to-maturity or available-for-sale at the time of purchase. Investment securities classified as held-to-maturity, which management has the positive intent and ability to hold to maturity, are reported at amortized cost. Investment securities classified as available for sale, which management has the intent and ability to hold for an indefinite period of time, but not necessarily to maturity, are carried at fair value, with unrealized gains and losses, net of related deferred income taxes, included in stockholders’ equity as a separate component of other comprehensive income. Any decision to sell investment securities available for sale would be based on various factors, including, but not limited to, asset / liability management strategies, changes in interest rates or prepayment risks, liquidity needs, or regulatory capital considerations.

Premiums are amortized and discounts accreted using the interest method over the remaining terms of the related securities. Dividend and interest income are recognized when earned. Sales of investment securities are recorded at trade date, with realized gains and losses on sales determined using the specific identification method and included in non-interest income.

The Company evaluates securities for other-than-temporary impairment ("OTTI") on at least a quarterly basis, and more frequently when economic or market conditions warrant such an evaluation. For securities in an unrealized loss position, the Company considers the extent and duration of the unrealized loss, and the financial condition and near-term prospects of the issuer. The Company also assesses whether it intends to sell, or it is more likely than not that it will be required to sell, a security in an unrealized loss position before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the entire difference between amortized cost and fair value is recognized as impairment through earnings. For debt securities that do not meet the aforementioned criteria, the amount of impairment is split into two components as follows: 1) OTTI related to credit loss, which must be recognized in the income statement and 2) OTTI related to other factors, which is recognized in other comprehensive income. The credit loss is defined as the difference between the present value of the cash flows expected to be collected and the amortized cost basis.

Federal Home Loan Bank Stock

As a member of the FHLB of New York, the Company is required to maintain an investment in the stock of the FHLB based upon the amount of outstanding FHLB borrowings. This stock does not have a readily determinable fair value and is carried at cost.

Loans Held for Sale

Loans held for sale are carried at the lower of cost or estimated fair value in the aggregate as determined by outstanding commitments from investors. Gains or losses on loan sales are recognized at the time of sale and are determined by the difference between net sales proceeds and the principal balance of the loans sold, adjusted for net deferred loan fees or costs. Loan origination and commitment fees, net of certain direct loan origination costs, are deferred as an adjustment to the carrying value of the loan until it is sold.

Loans and Loan Interest Income Recognition

Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff, are reported at the principal balance outstanding, net of purchase premiums and discounts, deferred loan fees and costs, and an allowance for loan losses. The loan portfolio is segmented into residential real estate, commercial real estate, multifamily, commercial and industrial, construction, and consumer loans.

Interest income on loans is accrued and credited to income as earned. Net loan origination fees and costs are deferred and accreted/amortized to interest income over the loan’s contractual life using the level-yield method, adjusted for actual prepayments.

Acquired loans are recorded at their fair value at the acquisition date. Credit discounts are included in the determination of fair value; therefore, an allowance for loan losses is not recorded at the acquisition date.

Acquired loans are evaluated upon acquisition and classified as either purchased credit impaired or purchased non-impaired. Purchased credit impaired loans reflect credit deterioration since origination such that it is probable at acquisition that the Company will be unable to collect all contractually required payments. For purchased credit impaired loans, expected cash flows at the acquisition date in excess of the fair value of loans are recorded as interest income over the remaining life of the loans (accretable yield) using a level yield method if the timing and amount of the future cash flows is reasonably estimable. The excess of the loan’s contractual principal and interest over expected cash flows is not recorded (nonaccretable difference).

Subsequent to the acquisition date, increases in cash flows over those expected at the acquisition date are recognized prospectively as interest income. Decreases in expected cash flows after the acquisition date are recognized immediately through the provision for loan losses. For purchased non-impaired loans, the difference between the fair value and unpaid principal balance of the loan at the acquisition date is amortized or accreted to interest income over the economic life of the loans using a method that approximates the interest method.

Lending Risk

The principal business of the Bank is lending in one-to-four family residential mortgage loans, commercial real estate mortgage loans, multi-family mortgage loans, commercial and industrial loans and consumer loans. The Bank considers its primary lending area to be Nassau County and the New York City boroughs. A substantial portion of the Bank's loans is secured by real estate in these areas. Accordingly, the ultimate collectability of the loan portfolio is susceptible to changes in market and economic conditions in this region.

One-to-four family residential mortgage loans involve certain risks such as interest rate risk and risk of nonpayment. Adjustable-rate loans decrease the interest rate risk to the Company that is associated with changes in interest rates but involve other risks, primarily because as interest rates rise, the payment by the borrower rises to the extent permitted by the terms of the loan, thereby increasing the potential for default. At the same time, the marketability of the underlying property may be adversely affected by higher interest rates. Repayment risk can be affected by the overall health of the economy, including unemployment rates and housing prices.

Commercial real estate lending entails significant additional risks as compared with single-family residential property lending. Such loans typically involve large loan balances to single borrowers or groups of related borrowers. Loans in this classification include income producing investment properties and owner-occupied real estate used for business purposes. The underlying properties are located largely in the Bank's primary market area. The cash flows of the income producing investment properties could be adversely impacted by a downturn in the economy as evidenced by increased vacancy rates, which in turn, could have an effect on credit quality. In the case of owner-occupied real estate used for business purposes, a weakened economy and resultant decreased consumer and/or business spending could have an adverse effect on credit quality.

Multifamily lending entails additional risks as compared with single-family residential property lending, but less when compared to commercial real estate lending. Loans in this classification include income producing residential investment properties of five or more families. Loans are made to established owners with a proven and demonstrable record of strong performance. Loans are secured by a first mortgage lien on the subject property. Repayment is derived generally from the rental income generated from the property and may be supplemented by the owners' personal cash flow. Credit risk arises with changes in economic conditions that could cause an increase in vacancy rates.

Commercial and industrial lending is generally considered higher risk due to the concentration of principal in a limited number of loans and borrowers and the effects of general economic conditions on the business. Generally, these loans are primarily secured by inventories and other assets of the business and repayment is expected from the cash flows of the business. A weakened economy, and resultant decreased consumer and/or business spending, will have an effect on the credit quality in this loan class.

The Company’s construction loan portfolio covers the development of commercial properties. Construction loans involve the disbursement of funds during construction with repayment substantially dependent on the success of the ultimate project. These loans are closely monitored by on-site inspections and are considered to have higher risks than other real estate loans because their ultimate repayment depends on the satisfactory completion of construction and is sensitive to interest rate changes, governmental regulation of real property, general economic conditions and the availability of long-term financing. Repayment is dependent on completion of the project and the subsequent financing of the completed project as a commercial real estate loan, and in some instances on the rent or sale of the underlying project.

Consumer loans generally have shorter terms and higher interest rates than other lending but generally involve more credit risk because of the type and nature of the collateral and, in certain cases, the absence of collateral. Repayment is dependent on the credit quality of the individual borrower and, if applicable, sale of the collateral securing the loan. Therefore, the overall health of the economy, including unemployment rates and housing prices, will have an effect on the credit quality in this loan class.

Allowance for Loan Losses

A loan is considered past due when it is not paid in accordance with its contractual terms. The accrual of income on loans, including impaired loans, and other loans in the process of foreclosure, is generally discontinued when a loan becomes 90 days or more delinquent, or when certain factors indicate that the ultimate collection of principal and interest is in doubt. Loans on which the accrual of income has been discontinued are designated as non-accrual loans. All previously accrued interest is reversed against interest income, and income is recognized subsequently only in the period that cash is received, provided no principal payments are due and the remaining principal balance outstanding is deemed collectible. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured.

The Company defines an impaired loan as a loan for which it is probable, based on current information, that the Company will not collect all amounts due in accordance with the contractual terms of the loan agreement. The Company has defined the population of impaired loans to be all non-accrual loans, loans risk rated 9 (Doubtful) or 10 (Loss), and all loans subject to a troubled debt restructuring (“TDR”). Impaired loans are individually assessed to determine that the loan’s carrying value is not in excess of the expected future cash flows, discounted at the loan’s original effective interest rate, or the underlying collateral (less estimated costs to sell) if the loan is collateral dependent. Impairments are recognized through a charge to the allowance for loan losses for the amount that the loan’s carrying value exceeds the discounted cash flow analysis or estimated fair value of collateral (less estimated costs to sell) if the loan is collateral dependent.

The allowance for loan losses is increased by the provision for loan losses charged against income and is decreased by charge-offs, net of recoveries. Loan losses are recognized in the period the loans, or portion thereof, are deemed uncollectible. Generally, the Company will record a loan charge-off (including a partial charge-off) to reduce a loan to the estimated fair value of the underlying collateral, less costs to sell, if it is determined that it is probable that recovery will come primarily from the sale of such collateral. The provision for loan losses is based on management’s evaluation of the adequacy of the allowance which considers, among other things, impaired loans, past loan loss experience, known and inherent risks in the portfolio, existing adverse situations that may affect the borrower’s ability to repay, and estimated fair value of any underlying collateral securing loans. Additionally, management evaluates changes, if any, in underwriting standards, collection, charge-off and recovery practices, the nature or volume of the portfolio, lending staff, concentration of loans, as well as current economic conditions, and other relevant factors. Management believes the allowance for loan losses is adequate to provide for probable and reasonably estimable losses at the statement of condition date.

The allowance for loan losses consists of the following components:

Specific allowances are established for impaired loans, generally defined by the Company to be all nonaccrual loans, loans risk rated 8 (Substandard), 9 (Doubtful) or 10 (Loss), and all loans subject to a TDR. The amount of impairment provided for as an allowance is represented by the deficiency, if any, between the present value of expected future cash flows discounted at the original loan’s effective interest rate or the underlying collateral value (less estimated costs to sell) if the loan is collateral dependent, and the carrying value of the loan. Impaired loans that have no impairment losses are not considered for general valuation allowances described below.

General allowances are established for loan losses on a portfolio basis for loans that do not meet the definition of impaired. The portfolio is grouped into similar risk characteristics, primarily by loan segment and internal credit risk ratings. Historical loss experience is applied to each loan group using a three-year lookback period. The loss experience is adjusted, as appropriate, for the environmental factors discussed below. This evaluation is inherently subjective, as it requires material estimates that may be susceptible to significant revisions based upon changes in economic and market conditions. Actual loan losses may be significantly more than the allowance for loan losses we have established, which could have a material negative effect on the Company’s financial results.

In underwriting a loan secured by real property, the Company requires an appraisal (or an automated valuation model) of the property by an independent licensed appraiser approved by the Company’s Board of Directors. The appraisal is subject to review by an independent third party hired by the Company. Management reviews and inspects properties before disbursement of funds during the term of a construction loan. Generally, management obtains updated appraisals when a loan is deemed impaired. These appraisals may be more limited than those prepared for the underwriting of a new loan. In addition, when the Company acquires other real estate owned, it generally obtains a current appraisal to substantiate the net carrying value of the asset at the time of foreclosure.

As noted above, the adjustments to the Company’s loss experience is based on management’s evaluation of several environmental factors, including:

•

changes in local, regional, national, and international economic and business conditions and developments that affect the collectability of the loan portfolio, including the condition of various market segments;

•

changes in the nature and volume of the Company’s portfolio and in the terms of the Company’s loans;

•

changes in the experience, ability, and depth of lending management and other relevant staff;

•

changes in the volume and severity of past due loans, the volume of nonaccrual loans, and the volume and severity of adversely classified or graded loans;

•

changes in the quality of the Company’s loan review system;

•

changes in lending policies, procedures and strategies;

•

changes in the value of underlying collateral for collateral-dependent loans;

•

the existence and effect of any concentrations of credit, and changes in the level of such concentrations; and

•

the effect of other external factors such as competition and legal and regulatory requirements on the level of estimated credit losses in the Company’s existing portfolio.

While management uses available information to recognize probable and reasonably estimable losses on loans, future additions to the allowance may be necessary based upon changes in economic, market or other conditions. Changes in estimates could result in a material change in the allowance. In addition, various regulatory agencies, as an integral part of their examination process, periodically review the Company’s allowance for loan losses. Such agencies may require the Company to recognize additions to the allowance based on their judgments about information available to them at the time of their examination.

A loan modification is deemed a TDR when two conditions are met: 1) the borrower is experiencing financial difficulty; and 2) a concession is made by the Company that would not otherwise be considered for a borrower or collateral with similar credit risk characteristics. Once an obligation has been restructured, it continues to be considered restructured until paid in full or otherwise settled, sold or charged off. The Company records an impairment charge equal to the difference between the present value of estimated future cash flows under the restructured terms discounted at the original loan’s effective interest rate, or the underlying collateral value less costs to sell, if the loan is collateral dependent.

The allowance for loan and lease losses related to purchased credit impaired loans is based on an analysis that is performed each period to estimate the expected cash flows for each of the loan pools. To the extent that the expected cash flows of a loan pool have decreased since the acquisition date, the Company establishes an allowance for loan losses.

Loan Modifications Under the CARES Act

On March 27, 2020, the President of the United States signed the CARES Act, which provides entities with optional temporary relief from certain accounting and financial reporting requirements under GAAP.

The CARES Act allows financial institutions to suspend application of certain current TDR accounting guidance under ASC 310-40 for loan modifications related to the COVID-19 pandemic made between March 1, 2020 and the earlier of December 31, 2020 or 60 days after the end of the COVID-19 national emergency, provided certain criteria are met. This relief can be applied to loan modifications for borrowers that were not more than 30 days past due as of December 31, 2019 and to loan modifications that defer or delay the payment of principal or interest or change the interest rate on the loan. In April 2020, federal and state banking regulators issued the Interagency Statement on Loan Modifications and Reporting for Financial Institutions Working with Customers Affected by the Coronavirus to provide further interpretation of when a borrower is experiencing financial difficulty, specifically indicating that if the modification is either short-term (e.g., six months) or mandated by a federal or state government in response to the COVID-19 pandemic, the borrower is not experiencing financial difficulty under ASC 310-40. The Company continues to prudently work with borrowers negatively impacted by the COVID-19 pandemic while managing credit risks and recognizing an appropriate allowance for loan and lease losses on its loan portfolio. The Company approved total loan modifications under the CARES Act of $220.4 million, of which $19.5 million remain as of September 30, 2021.

Another key program under the CARES Act is the PPP administered by the SBA which provided funding to qualifying businesses and organizations. Under this program, we have originated approximately $366.1 million in principal amount of PPP loans to local borrowers. As of September 30, 2021, borrowers had applied for and received forgiveness on $225.4 million in PPP loans. These loans are fully guaranteed by the SBA and provide for full forgiveness of the loans during a specified forgiveness period that meet specific guidelines provided by the SBA. Loans that do not meet the forgiveness criteria will enter a repayment period of two or five years.

Mortgage Servicing Rights

The Company originates and sells mortgage loans in the secondary market and may retain the servicing of these loans. When mortgage loans are sold with servicing retained, servicing rights are initially recorded at fair value with the income statement effect recorded in gains on sale of loans. Fair value is based on market prices for comparable mortgage servicing contracts, when available, or alternatively, is based on a valuation model that calculates the present value of estimated future net servicing income. In addition, upon the acquisition of Savoy the Company retains the servicing of the guaranteed portion of SBA loans that are sold in the secondary market.

Under the fair value measurement method, the Company measures servicing rights at fair value at each reporting date and reports changes in fair value of servicing assets in earnings in the period in which the changes occur and are included as a component of non-interest expense on the consolidated income statement. The fair value of servicing rights is subject to significant fluctuations as a result of changes in estimated and actual prepayment speeds and default rates and losses.

Fees earned for servicing loans are reported on the statements of income as loan servicing income when the related mortgage loan payments are collected. The amortization of loan servicing rights is netted against loan servicing fee income. Servicing fees totaled $0.6 million and $0.1 million for the years ended September 30, 2021 and 2020, respectively. Late fees and ancillary fees related to loan servicing are not material.

Transfers of Financial Assets

Transfers of financial assets are accounted for as sales, when control over the assets has been relinquished. Control over transferred assets is deemed to be surrendered 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 assets, and the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity.

Premises and Equipment

Premises and equipment are stated at cost less accumulated depreciation and amortization. Land is carried at cost. Depreciation and amortization are computed using the straight-line method over the estimated useful lives of the respective assets, which are 39 years for buildings and two to 10 years for furniture, fixtures and equipment. Leasehold improvements are amortized over the terms of the respective leases or the estimated useful lives of the improvements, whichever is shorter. Repairs and maintenance costs are recorded as a component of non-interest expense as incurred.

Goodwill and Other Intangible Assets

Goodwill arises from business combinations and is generally determined as the excess of the fair value of the consideration transferred over the fair value of the net assets acquired and liabilities assumed as of the acquisition date. Goodwill and intangible assets acquired in a purchase business combination and determined to have an indefinite useful life are not amortized but tested for impairment at least annually or more frequently if events and circumstances exist that indicate that a goodwill impairment test should be performed. The Company has selected August 31 as the date to perform the annual impairment test. Intangible assets with definite useful lives are amortized over their estimated useful lives to their estimated residual values. Goodwill is the only intangible asset with an indefinite life on the balance sheet.

Other intangible assets with definite useful lives are amortized over their estimated useful lives to their estimated residual values. Core deposit intangible assets are amortized on an accelerated method over their estimated useful life of 10 years.

Debt Issuance Costs

The costs attributable to issuing a debt instrument are reported on the Consolidated Balance Sheet as a deduction from the face amount of the note and amortized as interest expense over the term of the note.

Earnings Per Share

Basic earnings per common share is computed using the weighted average number of common shares outstanding during the reporting period. Diluted earnings per common share is the amount of earnings available to each share of common stock during the reporting period adjusted to include the effect of potentially dilutive common shares. Potentially dilutive common shares are excluded from the computation of dilutive earnings per share in the periods in which the effect would be anti-dilutive.

Comprehensive Income

Comprehensive income consists of net income and other comprehensive income (loss). Other comprehensive income (loss) includes unrealized gains and losses on securities available for sale which are also recognized as separate components of stockholders’ equity.

Income Taxes

Income tax expense is comprised of two components, current and deferred. The current component reflects taxes payable or refundable for a current period based on applicable tax laws, and the deferred component represents the tax effects of temporary differences between amounts recognized for financial accounting and tax purposes. Deferred tax assets and liabilities reflect the tax effects of such differences that are anticipated to result in taxable or deductible amounts in the future, when the temporary differences reverse. Deferred tax assets are recognized if it is more likely than not they will be realized, and may be reduced by a valuation allowance if it is more likely than not that all or some portion will not be realized.

Tax positions that are uncertain but meet a more likely than not recognition threshold are initially and subsequently measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon settlement with a taxing authority that has full knowledge of all relevant information. The determination of whether or not a tax position meets the more likely than not recognition threshold considers the facts, circumstances, and information available at the reporting date and is subject to management's judgment.

The Company recognizes interest expense and penalties on uncertain tax positions as a component of income tax expense and recognizes interest income on refundable income taxes as a component of other non-interest income.

Fair Value Measurements

The Company measures certain assets and liabilities on a fair value basis, in accordance with Accounting Standards Codification (ASC) Topic 820, "Fair Value Measurement." Fair values of financial instruments are estimated using relevant market information and other assumptions, as more fully disclosed in Note 15. Fair value estimates involve uncertainties and matters of significant judgment regarding interest rates, credit risk, prepayments, and other factors, especially in the absence of broad markets for particular items. Changes in assumptions or in market conditions could significantly affect these estimates.

Revenue From Contracts With Customers

Revenue from contracts with customers generally comprises deposit service fees, which are included as a component of other non-interest income in the accompanying Consolidated Statements of Income. The Company identifies the performance obligations included in the contracts with customers, determines the transaction price, allocates the transaction price to the performance obligations, as applicable, and recognizes revenue when performance obligations are satisfied, which is generally at the point services are performed for the customer.

Operating Segments

While management monitors the revenue streams of the Company’s various products and services, the identifiable segments are not material and operations are managed and financial performance is evaluated on a Company-wide basis. Accordingly, all the financial service operations are considered by management to be aggregated in one reportable operating segment.

Stock Compensation Plans

Compensation cost is recognized for stock options and restricted stock awards issued to employees and directors based upon the fair value of these awards at the date of grant. A Black-Scholes model is utilized to estimate the fair value of stock options.

Compensation cost is recognized over the required service period, generally defined as the vesting period. For awards with graded vesting, compensation cost is recognized on a straight-line basis over the requisite service period for the entire award. The Company’s accounting policy is to recognize forfeitures as they occur.

Supplemental Executive Retirement Plan

In connection with the previous acquisition of Chinatown Federal Savings Bank (“CFSB”), the assets of the CFSB Supplemental Executive Retirement Plan (“CFSB SERP”) are included in the Consolidated Statements of Financial Condition. The CFSB SERP provides benefits to two former executives of CFSB and the assets of the CFSB SERP are held in a Rabbi Trust which was fully funded prior to the acquisition of CFSB by the Company. The Company has no further liability or obligation with respect to the CFSB SERP assets other than record keeping. No ongoing valuation of the assets will be obtained and the amount of plan assets will continue to be equal to the liability reflected on the Consolidated Statement of Financial Condition. The SERP liability is included in other liabilities on the Consolidated Statement of Financial Condition.

Accounting Standards Issued But Not Yet Effective

In February 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-02, Leases. The amendments in this update primarily replace the existing accounting requirements for operating leases for lessees. Lessee accounting requirements for finance leases and lessor accounting requirements for operating leases and sales type and direct financing leases (sales-type and direct financing leases were both previously referred to as capital leases) are largely unchanged. The amendments require the lessee of an operating lease to record a balance sheet gross-up upon lease commencement by recognizing a right-of-use asset and lease liability equal to the present value of the lease payments. The right-of-use asset and lease liability should be derecognized in a manner that effectively yields a straight-line lease expense over the lease term. In addition to the changes to the lessee operating lease accounting requirements, the amendments also change the types of costs that can be capitalized related to a lease agreement for both lessees and lessors. The amendments also require additional disclosures for all lease types for both lessees and lessors. The FASB has subsequently issued additional ASUs intended to clarify guidance, provide implementation support, and provide an additional transition election. The amendments are effective on October 1, 2022, with early adoption permitted. The amendments must be applied on a modified retrospective basis, and we anticipate selecting the transition option that will allow us to record a cumulative adjustment as of the adoption date. We are assessing our current population of lease contracts and upon adoption, our balance sheet will include a right-of-use asset and lease liability for our operating leases where we are the lessee, which primarily include our facilities leases. We do not anticipate the adoption of these amendments will have a material impact to our consolidated financial statements. We plan to adopt these amendments on October 1, 2022 and expect to use the modified retrospective approach as currently required.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments. The amendments introduce an impairment model that is based on current expected credit losses, rather than incurred losses, to estimate credit losses on certain types of financial instruments (i.e. loans and held to maturity securities), including certain off-balance sheet financial instruments (i.e. commitments to extend credit and standby letters of credit that are not unconditionally cancellable). The CECL should consider historical information, current information, and reasonable and supportable forecasts, including estimates of prepayments, over the contractual term. An entity must use judgment in determining the relevant information and estimation methods that are appropriate in its circumstances. Financial instruments with similar risk characteristics may be grouped together when estimating credit losses. The allowance for credit losses for purchased financial assets with a more-than-insignificant amount of credit deterioration since origination that are measured at amortized cost basis is determined in a similar manner to other financial assets measured at amortized cost basis; however, the initial estimate of expected credit loss would be recognized through an allowance for credit losses with an offset (i.e. increase) to the purchase price at acquisition. Only subsequent changes in the allowance for credit losses are recorded as provision for loan losses for these assets. The ASU also amends the current available for sale security impairment model for debt securities whereby credit losses relating to available for sale debt securities should be recorded through an allowance for credit losses. The amendments will be applied through a modified retrospective approach, resulting in a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. As the Company is a smaller-reporting company under SEC regulations, the Company will adopt CECL on October 1, 2023 and the future adoption of this ASU may have a material effect on the Company’s consolidated financial statements.

Goodwill and Other Intangible Assets, Activity for Goodwill and Other Intangible Assets (Details) $ in Thousands	12 Months Ended
	Sep. 30, 2021 USD ($) Reportingunit	Sep. 30, 2020 USD ($)
Goodwill [Roll Forward]
Goodwill at beginning of period	$ 1,901	$ 1,482
Acquisition	17,457	0
Measurement period adjustment for previous acquisition	(190)	419
Goodwill at end of period	19,168	1,901
Other Intangible Assets [Abstract]
Amortization	(32)	(5)
Other intangible assets at end of period	$ 480
Impairment of Intangible Assets [Abstract]
Number of reporting units \| Reportingunit	1
Impairment charges	$ 0	0
Core Deposits [Member]
Other Intangible Assets [Abstract]
Other intangible assets at beginning of period	22	27
Acquisition	490	0
Amortization	(32)	(5)
Other intangible assets at end of period	$ 480	$ 22

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2021	Sep. 30, 2020
Other comprehensive income, net of tax:
Change in unrealized gain on investment securities available for sale, tax	$ 77	$ 35
Reclassification adjustment for gains realized in net income, tax	$ 49	$ 0

Allowance for Loan Losses, Allowance for Loan Losses and Recorded Investment by Portfolio Segment Based on Impairment Method (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2019
Allowance for Loan Losses [Abstract]
Individually evaluated for impairment	$ 0	$ 0
Collectively evaluated for impairment	8,552	7,869
Purchased-credit impaired	0	0
Total allowance for loan losses	8,552	7,869	$ 7,143
Loans [Abstract]
Individually evaluated for impairment	8,673	3,231
Collectively evaluated for impairment	1,228,211	721,788
Purchased-credit impaired	10,241	0
Total loans	1,247,125	725,019
Residential Real Estate [Member]
Allowance for Loan Losses [Abstract]
Individually evaluated for impairment	0	0
Collectively evaluated for impairment	4,155	5,103
Purchased-credit impaired	0	0
Total allowance for loan losses	4,155	5,103	4,647
Loans [Abstract]
Individually evaluated for impairment	7,198	2,221
Collectively evaluated for impairment	436,942	451,539
Purchased-credit impaired	0
Total loans	444,140	453,760
Multi-Family [Member]
Allowance for Loan Losses [Abstract]
Individually evaluated for impairment	0	0
Collectively evaluated for impairment	2,433	1,506
Purchased-credit impaired	0	0
Total allowance for loan losses	2,433	1,506	1,215
Loans [Abstract]
Individually evaluated for impairment	458	47
Collectively evaluated for impairment	266,256	136,690
Purchased-credit impaired	0
Total loans	266,714	136,737
Commercial Real Estate [Member]
Allowance for Loan Losses [Abstract]
Individually evaluated for impairment	0	0
Collectively evaluated for impairment	1,884	1,221
Purchased-credit impaired	0	0
Total allowance for loan losses	1,884	1,221	1,193
Loans [Abstract]
Individually evaluated for impairment	517	629
Collectively evaluated for impairment	339,966	113,129
Purchased-credit impaired	8,324
Total loans	348,807	113,758
Commercial and Industrial [Member]
Allowance for Loan Losses [Abstract]
Individually evaluated for impairment	0	0
Collectively evaluated for impairment	79	38
Purchased-credit impaired	0	0
Total allowance for loan losses	79	38	75
Loans [Abstract]
Individually evaluated for impairment	500	334
Collectively evaluated for impairment	169,660	20,404
Purchased-credit impaired	1,917	0
Total loans	172,077	20,738
Construction [Member]
Allowance for Loan Losses [Abstract]
Individually evaluated for impairment	0	0
Collectively evaluated for impairment	0	0
Purchased-credit impaired	0	0
Total allowance for loan losses	0	0	0
Loans [Abstract]
Individually evaluated for impairment	0	0
Collectively evaluated for impairment	15,374	0
Purchased-credit impaired	0	0
Total loans	15,374	0
Consumer [Member]
Allowance for Loan Losses [Abstract]
Individually evaluated for impairment	0	0
Collectively evaluated for impairment	1	1
Purchased-credit impaired	0	0
Total allowance for loan losses	1	1	$ 13
Loans [Abstract]
Individually evaluated for impairment	0	0
Collectively evaluated for impairment	13	26
Purchased-credit impaired	0	0
Total loans	$ 13	$ 26

Parent Company Only Condensed Financial Information, Statements of Cash Flows (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2021	Sep. 30, 2020
Cash flows from operating activities [Abstract]
Net income	$ 10,851	$ 4,974
Adjustments to reconcile net income to net cash used in operating activities [Abstract]
Amortization of debt issuance costs	72	3
Increase in other assets	1,398	(1,180)
Increase in accrued interest payable	(134)	(157)
Increase (decrease) in other liabilities	239	(2,052)
Net cash provided by operating activities	13,192	566
Cash flows from investing activities [Abstract]
Net cash provided by (used in) investing activities	89,850	(7,290)
Cash flows from financing activities [Abstract]
Proceeds from issuance of subordinated debentures, net of issuance costs	24,455	0
Repayment of note payable	(15,000)	0
Net proceeds from stock options exercised	0	107
Net proceeds from issuance of common stock	113	112
Net cash used in financing activities	(16,707)	(898)
Net increase (decrease) in cash and cash equivalents	86,335	(7,622)
Cash and cash equivalents, beginning of period	80,209	87,831
Cash and cash equivalents, end of period	166,544	80,209
Supplemental non-cash disclosures [Abstract]
Common stock issued in acquisition	31,252	0
Stock options rolled over in acquisition	1,269	0
Parent Company [Member]
Cash flows from operating activities [Abstract]
Net income	10,851	4,974
Adjustments to reconcile net income to net cash used in operating activities [Abstract]
Equity in undistributed earnings of the bank	(11,916)	(5,679)
Amortization of debt issuance costs	72	3
Increase in other assets	(295)	(187)
Increase in accrued interest payable	542	29
Increase (decrease) in other liabilities	235	(13)
Net cash provided by operating activities	(511)	(873)
Cash flows from investing activities [Abstract]
Investment in bank	(9,000)	0
Net cash provided by (used in) investing activities	(9,000)	0
Cash flows from financing activities [Abstract]
Proceeds from issuance of subordinated debentures, net of issuance costs	24,455	0
Repayment of note payable	(15,000)	0
Net proceeds from stock options exercised	0	107
Net proceeds from issuance of common stock	113	112
Net cash used in financing activities	9,568	219
Net increase (decrease) in cash and cash equivalents	57	(654)
Cash and cash equivalents, beginning of period	514	1,168
Cash and cash equivalents, end of period	571	514
Supplemental non-cash disclosures [Abstract]
Common stock issued in acquisition	31,252	0
Stock options rolled over in acquisition	$ 1,269	$ 0

Borrowings (Tables)

12 Months Ended

Sep. 30, 2021

Borrowings [Abstract]

Contractual Maturities and Weighted Average Interest Rates of FHLB Advances

The following table sets forth the contractual maturities and weighted average interest rates of the Company’s fixed rate FHLB advances:

(in thousands)	Balance at September 30, 2021
Contractual Maturity	Amount		Weighted Average Rate
2022	$	4,000		2.02	%
2023		12,040		2.23	%
2024		18,860		0.98	%
2025		7,080		0.58	%
Total	$	41,980		1.37	%

	Balance at September 30, 2020
Contractual Maturity	Amount		Weighted Average Rate
2021	$	34,758		1.67	%
2022		4,000		2.02	%
2023		4,300		1.15	%
2024		18,860		0.98	%
Thereafter		7,080		0.58	%
Total	$	68,998		1.36	%

Equity Compensation Plans (Tables)

12 Months Ended

Sep. 30, 2021

Equity Compensation Plans [Abstract]

Summary of Stock Option Activity

A summary of stock option activity follows (aggregate intrinsic value in thousands):

	Number of Options		Weighted Average Exercise Price		Aggregate Intrinsic Value		Weighted Average Remaining Contractual Term
Outstanding, October 1, 2020		155,506	$	11.35	$	1,623	4.66 years
Converted in Savoy acquisition		71,900		5.51
Exercised		-		-
Forfeited		-		-
Outstanding, September 30, 2021 ⁽¹⁾		227,406	$	9.50	$	2,043	3.51 years

⁽¹⁾ All outstanding options are fully vested and exercisable

Summary of Restricted Stock Activity

A summary of restricted stock activity follows:

	Shares			Weighted Average Grant Date Fair Value
Unvested, October 1, 2020		95,052		$	19.56
Granted		28,727			19.88
Vested		(46,112	)		19.16
Forfeited		(1,834	)		21.85
Unvested, September 30, 2021		75,833			19.87

Deposits (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Sep. 30, 2020
Non-interest bearing [Abstract]
Demand	$ 191,537	$ 82,350
Interest-bearing [Abstract]
NOW	353,977	34,086
Money market	181,148	110,353
Savings	60,164	43,218
Time deposits $250,000 and greater	60,242	78,628
Time deposits less than $250,000	317,594	316,125
Total interest-bearing	973,125	582,410
Total deposits	1,164,662	$ 664,760
Maturities of Time Deposits [Abstract]
2022	277,431
2023	49,059
2024	25,248
2025	18,002
2026	7,104
Thereafter	992
Total	$ 377,836

Fair Value Measurements, Significant Inputs Utilized in Cash Flow Models (Details)	12 Months Ended
	Sep. 30, 2021	Sep. 30, 2020
Fair Value Hierarchy [Abstract]
Servicing rights, valuation technique [Extensible List]	us-gaap:ValuationTechniqueDiscountedCashFlowMember	us-gaap:ValuationTechniqueDiscountedCashFlowMember
SBA Loans [Member]
Fair Value Hierarchy [Abstract]
Servicing rights, valuation technique [Extensible List]	us-gaap:ValuationTechniqueDiscountedCashFlowMember
Significant Unobservable Inputs (Level 3) [Member] \| Discount Rate [Member] \| Minimum [Member]
Fair Value Hierarchy [Abstract]
Servicing rights, measurement input	0.120	0.120
Significant Unobservable Inputs (Level 3) [Member] \| Discount Rate [Member] \| Minimum [Member] \| SBA Loans [Member]
Fair Value Hierarchy [Abstract]
Servicing rights, measurement input	0.0464
Significant Unobservable Inputs (Level 3) [Member] \| Discount Rate [Member] \| Maximum [Member]
Fair Value Hierarchy [Abstract]
Servicing rights, measurement input	0.145	0.145
Significant Unobservable Inputs (Level 3) [Member] \| Discount Rate [Member] \| Maximum [Member] \| SBA Loans [Member]
Fair Value Hierarchy [Abstract]
Servicing rights, measurement input	0.2181
Significant Unobservable Inputs (Level 3) [Member] \| Prepayment Rate [Member] \| Minimum [Member]
Fair Value Hierarchy [Abstract]
Servicing rights, measurement input	0.2418	0.2384
Significant Unobservable Inputs (Level 3) [Member] \| Prepayment Rate [Member] \| Minimum [Member] \| SBA Loans [Member]
Fair Value Hierarchy [Abstract]
Servicing rights, measurement input	0.1187
Significant Unobservable Inputs (Level 3) [Member] \| Prepayment Rate [Member] \| Maximum [Member]
Fair Value Hierarchy [Abstract]
Servicing rights, measurement input	0.2433	0.2395
Significant Unobservable Inputs (Level 3) [Member] \| Prepayment Rate [Member] \| Maximum [Member] \| SBA Loans [Member]
Fair Value Hierarchy [Abstract]
Servicing rights, measurement input	0.2626
Significant Unobservable Inputs (Level 3) [Member] \| Weighted Average Life [Member] \| Minimum [Member]
Fair Value Hierarchy [Abstract]
Servicing rights, measurement input	1 year 11 months 15 days	2 years 6 months
Significant Unobservable Inputs (Level 3) [Member] \| Weighted Average Life [Member] \| Minimum [Member] \| SBA Loans [Member]
Fair Value Hierarchy [Abstract]
Servicing rights, measurement input	4 months 20 days
Significant Unobservable Inputs (Level 3) [Member] \| Weighted Average Life [Member] \| Maximum [Member]
Fair Value Hierarchy [Abstract]
Servicing rights, measurement input	3 years 3 months 18 days	3 years 3 months 18 days
Significant Unobservable Inputs (Level 3) [Member] \| Weighted Average Life [Member] \| Maximum [Member] \| SBA Loans [Member]
Fair Value Hierarchy [Abstract]
Servicing rights, measurement input	5 years 10 months 6 days

Income Taxes

12 Months Ended

Sep. 30, 2021

Income Taxes [Abstract]

Income Taxes

Note 10. Income Taxes

The following table details the components of income tax expense:

	Year Ended September 30,
(in thousands)	2021			2020
Current:
Federal	$	2,594		$	1,303
State		242			116
Total current		2,836			1,419
Deferred:
Federal		394			91
State		(383	)		(1,200	)
Total deferred		11			(1,109	)
Change in valuation allowance		354			930
Total income tax expense	$	3,201		$	1,240

The following table reflects a reconciliation of reported income tax expense to the amount that would result from applying the federal statutory rate of 21%:

	Year Ended September 30,
	2021						2020
(in thousands)	Amount			Percentage of Pre-tax Earnings			Amount			Percentage of Pre-tax Earnings
Federal income tax expense computed by applying the statutory rate to income before income taxes	$	2,951			21.0	%		1,305			21.0	%
State taxes, net of federal benefit		48			0.3	%		(646	)		-10.4	%
Non-deductible transaction costs		204			1.5	%		43			0.7	%
Other		(356	)		-2.5	%		(392	)		-6.3	%
Valuation allowance		354			2.5	%		930			15.0	%
Income tax expense	$	3,201			22.8	%	$	1,240			20.0	%

The following table summarizes the composition of deferred tax assets and liabilities:

	September 30,
(in thousands)	2021			2020
Deferred tax assets:
Allowance for loan losses	$	2,602		$	2,468
Organizational costs		76			46
Start-up and other costs		77			115
Net operating loss carryforwards		2,443			1,887
Accrued SERP		1,288			1,462
Purchase accounting fair value adjustments		2,034			-
Other assets		1,984			1,134
Total deferred tax assets		10,504			7,112
Deferred tax liabilities:
Depreciation		(771	)		(734	)
Deferred loan fees/costs		(883	)		(651	)
Purchase accounting fair value adjustments		-			(670	)
Tax bad debt reserve		(204	)		(124	)
Mortgage servicing rights		(1,122	)		(49	)
Unrealized gain on securities AFS		(70	)		(41	)
Total deferred tax liabilities		(3,050	)		(2,269	)
Total		7,454			4,843
Valuation allowance		(3,896	)		(2,765	)
Net deferred tax asset	$	3,558		$	2,078

The Company does not have net operating loss carryforwards available for federal income tax purposes as of September 30, 2021. The Company has net operating loss carryforwards available for state income tax purposes of approximately $29.7 million. For state purposes, $12.4 million expires in 2025 and the remaining $17.3 million will begin to expire in 2026. The Company has net operating loss carryforwards available for city income tax purposes of approximately $9.8 million, of which $1.5 million expires in 2025 and the remaining balance of $8.3 million will begin to expire in 2027.

ASC 740, Income Taxes, provides for the recognition of deferred tax assets if realization of such assets is more likely than not. The Company has recorded a federal deferred tax asset as, based upon an analysis of the evidence, it is more likely than not that such federal deferred tax asset will be recoverable. The federal deferred tax asset is included in other assets on the balance sheet. In March of 2014, New York State adopted legislation that benefited small community banks with less than $8 billion in average assets. Specifically, this legislation provides for a state and city subtraction modification for which the Company qualifies. This subtraction modification causes the Company to consistently generate net operating losses for New York State and New York City purposes and it will continue to do so for the foreseeable future. Accordingly, the Company has recorded a valuation allowance against the New York State and New York City portions of the deferred tax asset, as it is not more likely than not that such deferred tax assets will be recoverable. Management reassesses the need for a valuation allowance on an annual basis, or more frequently if warranted.

The Company and its subsidiaries are subject to U.S. federal income tax as well as income tax of the states of Connecticut, New Jersey and New York and the city of New York. The Company is no longer subject to examination by taxing authorities for years before 2017. A tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination. The Company has no unrecorded tax benefits, and the Company does not expect the total amount of unrecognized income tax benefits to significantly increase in the next twelve months.

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

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Allowance for Loan Losses [Abstract]

Allowance for Loan Losses (Tables)

12 Months Ended

Sep. 30, 2021

Activity in Allowance for Loan Losses by Portfolio Segment

The following tables represent the activity in the allowance for loan losses by portfolio segment for the years ended September 30, 2021 and 2020:

	Year Ended September 30, 2021
(in thousands)	Residential Real Estate			Multi- Family			Commercial Real Estate			Commercial and Industrial		Construction		Consumer		Total
Allowance for loan losses:
Beginning balance	$	5,103		$	1,506		$	1,221		$	38	$	-	$	1	$	7,869
Provision for loan losses		(681	)		959			693			29		-		-		1,000
Loans charged-off		(267	)		(32	)		(30	)		-		-		-		(329	)
Recoveries		-			-			-			12		-		-		12
Ending balance	$	4,155		$	2,433		$	1,884		$	79	$	-	$	1	$	8,552

	Year Ended September 30, 2020
(in thousands)	Residential Real Estate		Multi- Family		Commercial Real Estate			Commercial and Industrial			Construction		Consumer			Total
Allowance for loan losses:
Beginning balance	$	4,647	$	1,215	$	1,193		$	75		$	-	$	13		$	7,143
Provision for loan losses		456		291		252			263			-		(12	)		1,250
Loans charged-off		-		-		(224	)		(300	)		-		-			(524	)
Recoveries		-		-		-			-			-		-			-
Ending balance	$	5,103	$	1,506	$	1,221		$	38		$	-	$	1		$	7,869

Allowance for Loan Losses and Recorded Investment by Portfolio Segment Based on Impairment Method

The following table represents the balance in the allowance for loan losses and the recorded investment in loans by portfolio segment based on impairment evaluation method:

	September 30, 2021
(in thousands)	Residential Real Estate		Multi- Family		Commercial Real Estate		Commercial & Industrial		Construction		Consumer		Total
Allowance for loan losses:
Individually evaluated for impairment	$	-	$	-	$	-	$	-	$	-	$	-	$	-
Collectively evaluated for impairment		4,155		2,433		1,884		79		-		1		8,552
Purchased-credit impaired		-		-		-		-		-		-		-
Total allowance for loan losses	$	4,155	$	2,433	$	1,884	$	79	$	-	$	1	$	8,552
Loans:
Individually evaluated for impairment	$	7,198	$	458	$	517	$	500	$	-	$	-	$	8,673
Collectively evaluated for impairment		436,942		266,256		339,966		169,660		15,374		13		1,228,211
Purchased-credit impaired		-		-		8,324		1,917		-		-		10,241
Total loans held for investment	$	444,140	$	266,714	$	348,807	$	172,077	$	15,374	$	13	$	1,247,125

	September 30, 2020
(in thousands)	Residential Real Estate		Multi- Family		Commercial Real Estate		Commercial & Industrial		Construction		Consumer		Total
Allowance for loan losses:
Individually evaluated for impairment	$	-	$	-	$	-	$	-	$	-	$	-	$	-
Collectively evaluated for impairment		5,103		1,506		1,221		38		-		1		7,869
Purchased-credit impaired		-		-		-		-		-		-		-
Total allowance for loan losses	$	5,103	$	1,506	$	1,221	$	38	$	-	$	1	$	7,869
Loans:
Individually evaluated for impairment	$	2,221	$	47	$	629	$	334	$	-	$	-	$	3,231
Collectively evaluated for impairment		451,539		136,690		113,129		20,404		-		26		721,788
Purchased-credit impaired		-		-		-		-		-		-		-
Total loans held for investment	$	453,760	$	136,737	$	113,758	$	20,738	$	-	$	26	$	725,019

Summary of Significant Accounting Policies, Interest-Bearing Deposits in Other Financial Institutions (Details)	12 Months Ended
	Sep. 30, 2021
Interest-Bearing Deposits in Other Financial Institutions [Abstract]
Maximum period of interest-bearing deposits in other financial institutions to mature	90 days

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2021	Sep. 30, 2020
Securities:
Investment securities, held to maturity, fair value	$ 8,865	$ 11,131
STOCKHOLDERS' EQUITY
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized (in shares)	15,000,000	15,000,000
Preferred stock, shares issued (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	17,000,000	17,000,000
Common stock, shares issued (in shares)	5,563,426	4,175,144
Common stock, shares outstanding (in shares)	5,563,426	4,175,144

Related Party Transactions

12 Months Ended

Sep. 30, 2021

Related Party Transactions

Note 12. Related Party Transactions

The Company has had, and may be expected to have in the future, banking transactions in the ordinary course of business with its executive officers, directors, their immediate families and their affiliated companies (commonly referred to as related parties). Loans to related parties during 2021 were as follows:

(in thousands)
Beginning balance, October 1, 2020	$	2,577
New loans		-
Repayments		(87	)
Ending balance, September 30, 2021	$	2,490

Deposits from principal officers, directors and their affiliates at September 30, 2021 and 2020 were $20.0 million and $4.6 million, respectively.

Accumulated Other Comprehensive Income, Changes in Accumulated Other Comprehensive Income by Component, Net of Tax (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2021	Sep. 30, 2020
Changes in Other Comprehensive Income by Component, Net of Tax [Roll Forward]
Balance	$ 78,043	$ 71,950
Other comprehensive income, before reclassification	291
Amount reclassified from accumulated other comprehensive income	(191)
Other comprehensive income	100	134
Balance	122,529	78,043
Accumulated Other Comprehensive Income [Member]
Changes in Other Comprehensive Income by Component, Net of Tax [Roll Forward]
Balance	156	22
Other comprehensive income	100	134
Balance	256	156
Unrealized Gains and Losses on Available-for-Sale Debt Securities
Changes in Other Comprehensive Income by Component, Net of Tax [Roll Forward]
Balance	156	22
Other comprehensive income, before reclassification	291
Amount reclassified from accumulated other comprehensive income	(191)
Other comprehensive income		134
Balance	$ 256	$ 156

Total of all stockholders' equity (deficit) items, net of receivables from officers, directors, owners, and affiliates of the entity which are attributable to the parent. The amount of the economic entity's stockholders' equity attributable to the parent excludes the amount of stockholders' equity which is allocable to that ownership interest in subsidiary equity which is not attributable to the parent (noncontrolling interest, minority interest). This excludes temporary equity and is sometimes called permanent equity.

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Maturities of Time Deposits

Deposits (Tables)

12 Months Ended

Sep. 30, 2021

Deposits [Abstract]

Components of Deposits

The following table details the components of deposits:

	September 30,
(in thousands)	2021		2020
Non-interest bearing:
Demand	$	191,537	$	82,350
Interest-bearing:
NOW		353,977		34,086
Money market		181,148		110,353
Savings		60,164		43,218
Time deposits $250,000 and greater		60,242		78,628
Time deposits less than $250,000		317,594		316,125
Total interest-bearing		973,125		582,410
Total deposits	$	1,164,662	$	664,760

The scheduled maturities of time deposits are as follows:

	September 30,
(in thousands)	2021
2022	$	277,431
2023		49,059
2024		25,248
2025		18,002
2026		7,104
Thereafter		992
Total	$	377,836

Tabular disclosure of type of deposit liability.

Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (e)

Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (f)
-Subparagraph (2)(i)(ii)

Reference 3: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (a)
-Subparagraph (1)

Reference 4: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (f)
-Subparagraph (1)

Reference 5: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (d)

Reference 6: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (f)
-Subparagraph (2)(i)

Reference 7: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (f)
-Subparagraph (2)(i)(iv)

Reference 8: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (a)
-Subparagraph (5)

Reference 9: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (f)
-Subparagraph (2)(i)(iii)

Reference 10: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (a)
-Subparagraph (4)

Reference 11: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (f)
-Subparagraph (2)

Reference 12: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (c)

Reference 13: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (a)
-Subparagraph (2)

Reference 14: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (a)
-Subparagraph (3)

Reference 15: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (a)

Accumulated Other Comprehensive Income [Abstract]

Accumulated Other Comprehensive Income (Tables)

12 Months Ended

Sep. 30, 2021

Changes in Accumulated Other Comprehensive Income by Component, Net of Tax

The following is changes in accumulated other comprehensive income by component, net of tax, for the years ending September 30, 2021 and 2020:

(in thousands)	Unrealized Gains and Losses on Available- for-Sale Debt Securities			Total
Balance at October 1, 2020	$	156		$	156
Other comprehensive income, before reclassification		291			291
Amount reclassified from accumulated other comprehensive income		(191	)		(191	)
Balance at September 30, 2021	$	256		$	256

(in thousands)	Unrealized Gains and Losses on Available- for-Sale Debt Securities		Total
Balance at October 1, 2019	$	22	$	22
Other comprehensive income		134		134
Balance at September 30, 2020	$	156	$	156

Significant Amounts Reclassified Out of Accumulated Other Comprehensive Income

The following is significant amounts reclassified out of accumulated other comprehensive income for the year ended September 30, 2021:

(in thousands)	Amount Reclassified from Accumulated Other Comprehensive Income			Affected Line Item in Statement of Income
Realized gains on securities available-for-sale	$	240		Gain on sale of investment securities available-for-sale, net
Tax effect		(49	)	Income tax expense
Net of tax	$	191

Investment Securities, Summary of Realized Investment Gains and Losses (Details) - USD ($)
$ in Thousands

12 Months Ended

Sep. 30, 2021

Sep. 30, 2020

Realized Investment Gains (Losses) [Abstract]

Proceeds from sales

$ 3,240

$ 0

Gross realized gains on sales

240

Gross realized losses on sales

Total realized gains, net

^[1]

240

$ 0

Associated income tax

$ 49

[1]	(1) Amount does not include associated income tax of $49 for year ended September 30, 2021

Summary of Significant Accounting Policies, Operating Segments (Details)	12 Months Ended
	Sep. 30, 2021 Segment
Operating Segments [Abstract]
Number of operating segment	1

Goodwill and Other Intangible Assets, Estimated Future Amortization Expense (Details) $ in Thousands	Sep. 30, 2021 USD ($)
Estimated Future Amortization Expense for Other Intangible Assets [Abstract]
2022	$ 81
2023	72
2024	63
2025	55
2026	49
Thereafter	160
Total net book value	$ 480

Loans, Changes in Accretable Difference on Purchased Loans (Details) $ in Thousands	12 Months Ended
	Sep. 30, 2021 USD ($)
Changes in Accretable Difference on Purchased Loans [Abstract]
Balance at beginning of period	$ 0
Accretable differences acquired	540
Accretion	(194)
Adjustments to accretable difference due to changes in expected cash flows	0
Ending balance	$ 346

Allowance for Loan Losses

12 Months Ended

Sep. 30, 2021

Allowance for Loan Losses [Abstract]

Allowance for Loan Losses

Note 5: Allowance for Loan Losses

The following tables represent the activity in the allowance for loan losses by portfolio segment for the years ended September 30, 2021 and 2020:

	Year Ended September 30, 2021
(in thousands)	Residential Real Estate			Multi- Family			Commercial Real Estate			Commercial and Industrial		Construction		Consumer		Total
Allowance for loan losses:
Beginning balance	$	5,103		$	1,506		$	1,221		$	38	$	-	$	1	$	7,869
Provision for loan losses		(681	)		959			693			29		-		-		1,000
Loans charged-off		(267	)		(32	)		(30	)		-		-		-		(329	)
Recoveries		-			-			-			12		-		-		12
Ending balance	$	4,155		$	2,433		$	1,884		$	79	$	-	$	1	$	8,552

	Year Ended September 30, 2020
(in thousands)	Residential Real Estate		Multi- Family		Commercial Real Estate			Commercial and Industrial			Construction		Consumer			Total
Allowance for loan losses:
Beginning balance	$	4,647	$	1,215	$	1,193		$	75		$	-	$	13		$	7,143
Provision for loan losses		456		291		252			263			-		(12	)		1,250
Loans charged-off		-		-		(224	)		(300	)		-		-			(524	)
Recoveries		-		-		-			-			-		-			-
Ending balance	$	5,103	$	1,506	$	1,221		$	38		$	-	$	1		$	7,869

The following table represents the balance in the allowance for loan losses and the recorded investment in loans by portfolio segment based on impairment evaluation method:

	September 30, 2021
(in thousands)	Residential Real Estate		Multi- Family		Commercial Real Estate		Commercial & Industrial		Construction		Consumer		Total
Allowance for loan losses:
Individually evaluated for impairment	$	-	$	-	$	-	$	-	$	-	$	-	$	-
Collectively evaluated for impairment		4,155		2,433		1,884		79		-		1		8,552
Purchased-credit impaired		-		-		-		-		-		-		-
Total allowance for loan losses	$	4,155	$	2,433	$	1,884	$	79	$	-	$	1	$	8,552
Loans:
Individually evaluated for impairment	$	7,198	$	458	$	517	$	500	$	-	$	-	$	8,673
Collectively evaluated for impairment		436,942		266,256		339,966		169,660		15,374		13		1,228,211
Purchased-credit impaired		-		-		8,324		1,917		-		-		10,241
Total loans held for investment	$	444,140	$	266,714	$	348,807	$	172,077	$	15,374	$	13	$	1,247,125

	September 30, 2020
(in thousands)	Residential Real Estate		Multi- Family		Commercial Real Estate		Commercial & Industrial		Construction		Consumer		Total
Allowance for loan losses:
Individually evaluated for impairment	$	-	$	-	$	-	$	-	$	-	$	-	$	-
Collectively evaluated for impairment		5,103		1,506		1,221		38		-		1		7,869
Purchased-credit impaired		-		-		-		-		-		-		-
Total allowance for loan losses	$	5,103	$	1,506	$	1,221	$	38	$	-	$	1	$	7,869
Loans:
Individually evaluated for impairment	$	2,221	$	47	$	629	$	334	$	-	$	-	$	3,231
Collectively evaluated for impairment		451,539		136,690		113,129		20,404		-		26		721,788
Purchased-credit impaired		-		-		-		-		-		-		-
Total loans held for investment	$	453,760	$	136,737	$	113,758	$	20,738	$	-	$	26	$	725,019

Investment Securities (Tables)

12 Months Ended

Sep. 30, 2021

Investment Securities [Abstract]

Investment Securities Available for Sale and Held to Maturity

	September 30, 2021
(in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Available-for-sale:
U.S. GSE residential mortgage-backed securities	$	722	$	112	$	(1	)	$	833
Corporate bonds		6,700		214		-			6,914
Total available-for-sale	$	7,422	$	326	$	(1	)	$	7,747

Held-to-maturity:
U.S. GSE residential mortgage-backed securities	$	2,417	$	74	$	-		$	2,491
U.S. GSE commercial mortgage-backed securities		2,694		175		-			2,869
Corporate bonds		3,500		9		(4	)		3,505
Total held-to-maturity		8,611		258		(4	)		8,865
Total securities	$	16,033	$	584	$	(5	)	$	16,612

	September 30, 2020
(in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
Available-for-sale:
U.S. GSE residential mortgage-backed securities	$	838	$	124	$	-	$	962
Corporate bonds		5,000		73		-		5,073
Total available-for-sale	$	5,838	$	197	$	-	$	6,035

Held-to-maturity:
U.S. GSE residential mortgage-backed securities	$	4,478	$	118	$	-	$	4,596
U.S. GSE commercial mortgage-backed securities		2,749		253		-		3,002
Corporate bonds		3,500		33		-		3,533
Total held-to-maturity		10,727		404		-		11,131
Total securities	$	16,565	$	601	$	-	$	17,166

Securities Portfolio by Contractual Maturity

	September 30, 2021
(in thousands)	Amortized Cost		Fair Value
Available-for-sale:
Due in one year or less	$	-	$	-
Due after one year through five years		-		-
Due after five years through ten years		6,700		6,914
Due after ten years		-		-
Residential mortgage-backed securities		722		833
Total available-for-sale	$	7,422	$	7,747

Held-to-maturity:
Due in one year or less	$	-	$	-
Due after one year through five years		1,500		1,496
Due after five years through ten years		2,000		2,009
Due after ten years		-		-
Residential mortgage-backed securities		2,417		2,491
Commercial mortgage-backed securities		2,694		2,869
Total held-to-maturity	$	8,611	$	8,865

Realized Gains and Losses from Sale of Investment Securities

The following table presents a summary of realized gains and losses from the sale of investment securities:

	Year Ended September 30,
(in thousands)	2021		2020
Proceeds from sales	$	3,240	$	-
Gross realized gains on sales	$	240	$	-
Gross realized losses on sales		-		-
Total realized gains, net⁽¹⁾	$	240	$	-

(1) Amount does not include associated income tax of $49 for year ended September 30, 2021

Gross Unrealized Losses and Fair Values of Investment Securities

	Less than Twelve Months					Twelve Months or Longer				Total
(in thousands, except number of securities)	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses		Number of Securities		Fair Value		Gross Unrealized Losses
Available-for-sale:
U.S. GSE residential mortgage-backed securities	$	143	$	(1	)	$	-	$	-		6	$	143	$	(1	)
Total available-for-sale	$	143	$	(1	)	$	-	$	-		6	$	143	$	(1	)

Held-to-maturity:
Corporate bonds	$	1,496	$	(4	)	$	-	$	-		1	$	1,496	$	(4	)
Total held-to-maturity	$	1,496	$	(4	)	$	-	$	-		1	$	1,496	$	(4	)

Summary of Significant Accounting Policies (Policies)

12 Months Ended

Sep. 30, 2021

Summary of Significant Accounting Policies [Abstract]

Basis of Presentation

Certain prior period amounts have been reclassified to conform to the current year's presentation. These reclassifications had an immaterial effect on the Company's consolidated financial statements.

Use of Estimates

Risks and Uncertainties

Significant Group Concentrations of Credit Risk

Business Combinations

Cash and Cash Equivalents

Restrictions on Cash

Cash on hand or on deposit with the Federal Reserve Bank was required to meet regulatory reserve and clearing requirements.

Investment Securities

Federal Home Loan Bank Stock

Loans Held for Sale

Loans and Loan Interest Income Recognition

Lending Risk

Allowance for Loan Losses

The allowance for loan losses consists of the following components:

As noted above, the adjustments to the Company’s loss experience is based on management’s evaluation of several environmental factors, including:

•

changes in the nature and volume of the Company’s portfolio and in the terms of the Company’s loans;

•

changes in the experience, ability, and depth of lending management and other relevant staff;

•

changes in the volume and severity of past due loans, the volume of nonaccrual loans, and the volume and severity of adversely classified or graded loans;

•

changes in the quality of the Company’s loan review system;

•

changes in lending policies, procedures and strategies;

•

changes in the value of underlying collateral for collateral-dependent loans;

•

the existence and effect of any concentrations of credit, and changes in the level of such concentrations; and

•

the effect of other external factors such as competition and legal and regulatory requirements on the level of estimated credit losses in the Company’s existing portfolio.

Loan Modifications Under the CARES Act

Mortgage Servicing Rights

Transfers of Financial Assets

Premises and Equipment

Goodwill and Other Intangible Assets

Fair Value Measurements

Revenue From Contracts With Customers

Operating Segments

Stock Compensation Plans

Supplemental Executive Retirement Plan

Accounting Standards Issued But Not Yet Effective

Summary of Significant Accounting Policies, Mortgage Servicing Rights (Details) - USD ($) $ in Millions	12 Months Ended
	Sep. 30, 2021	Sep. 30, 2020
Mortgage Servicing Rights [Abstract]
Mortgage servicing fee income	$ 0.6	$ 0.1

Related Party Transactions (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2021	Sep. 30, 2020
Loans and Leases Receivable, Related Parties [Roll Forward]
Beginning balance	$ 2,577
New loans	0
Repayments	(87)
Ending balance	2,490
Deposits from principal officers, directors and affiliates	$ 20,000	$ 4,600

Revenue from Contracts with Customers (Details) - USD ($)
$ in Thousands

12 Months Ended

Sep. 30, 2021

Sep. 30, 2020

Net gain on sale of investments available-for-sale

^[1]

$ 240

$ 0

Net gain on sale of loans held-for-sale

^[1]

1,307

917

Other income

^[2]

468

Total non-interest income

3,349

1,364

Merchant card processing fees

Recoveries on acquired loans, included in other income

457

Loan Fees and Service Charges [Member]

Revenue from contracts with customers outside scope of ASC 606

^[1]

703

301

Loan Servicing Income [Member]

Revenue from contracts with customers outside scope of ASC 606

^[1]

504

Service Charges on Deposit Accounts [Member]

Revenue from contracts with customers in scope of ASC 606

$ 127

$ 62

[1]	Not included within the scope of ASC 606
[2]	Other income for the year ended September 30, 2021 includes $9 of merchant card processing fees, which are included in the scope of ASC 606. The remaining $457 represents recoveries on acquired loans, which are not included in the scope of ASC 606

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION - USD ($) $ in Thousands	Sep. 30, 2021	Sep. 30, 2020
ASSETS
Cash and non-interest-bearing deposits due from banks	$ 8,302	$ 6,239
Interest-bearing deposits due from banks	142,950	73,970
Federal funds sold	15,292	0
Total cash and cash equivalents	166,544	80,209
Investment securities, held-to-maturity (fair value of $8,865 and $11,131 at September 30, 2021 and 2020, respectively)	8,611	10,727
Investment securities, available-for-sale, at fair value	7,747	6,035
Loans held for investment	1,247,125	725,019
Allowance for loan losses	(8,552)	(7,869)
Loans held for investment, net	1,238,573	717,150
Premises and equipment, net	15,003	14,156
Accrued interest receivable	9,363	6,766
Prepaid pension	4,233	4,660
Stock in Federal Home Loan Bank, at cost	3,714	4,170
Goodwill	19,168	1,901
Other intangible assets	480	22
Loan servicing rights	3,690	155
Deferred income taxes	3,558	1,897
Other assets	3,957	3,758
TOTAL ASSETS	1,484,641	851,606
Deposits:
Non-interest bearing demand	191,537	82,350
Savings, NOW and money market	595,289	187,657
Time	377,836	394,753
Total deposits	1,164,662	664,760
Borrowings	159,642	85,154
Note payable	0	14,984
Subordinated debentures	24,513	0
Accrued interest payable	1,290	374
Other liabilities	12,005	8,291
TOTAL LIABILITIES	1,362,112	773,563
STOCKHOLDERS' EQUITY
Preferred stock; par value $0.01; 15,000,000 shares authorized, 0 issued at September 30, 2021 and 2020, respectively	0	0
Common stock; par value $0.01; 17,000,000 shares authorized, 5,563,426 and 4,175,144 shares issued and outstanding at September 30, 2021 and 2020, respectively	56	42
Capital in excess of par	97,246	63,725
Retained earnings	24,971	14,120
Accumulated other comprehensive income, net of tax	256	156
TOTAL STOCKHOLDERS' EQUITY	122,529	78,043
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$ 1,484,641	$ 851,606

Loans, Carrying Amount for Purchased Credit Impaired Loans (Details) $ in Thousands	Sep. 30, 2021 USD ($)
Carrying Amount for Purchased Credit Impaired Loans [Abstract]
Total recorded investment	$ 10,241
Commercial Real Estate [Member]
Carrying Amount for Purchased Credit Impaired Loans [Abstract]
Total recorded investment	8,324
Commercial and Industrial [Member]
Carrying Amount for Purchased Credit Impaired Loans [Abstract]
Total recorded investment	$ 1,917

Earnings Per Share (Tables)

12 Months Ended

Sep. 30, 2021

Earnings Per Share [Abstract]

Calculations of Basic and Diluted Earnings Per Share

The Company's basic and diluted earnings per share calculations are presented in the following table:

	Year Ended September 30,
(in thousands, except share and per share data)	2021		2020
Net income	$	10,851	$	4,974

Weighted-average common shares - basic		4,669,009		4,162,280
Add: Dilutive effect of stock options		89,660		64,687
Weighted-average common shares - diluted		4,758,669		4,226,967

Basic earnings per share	$	2.32	$	1.20
Diluted earnings per share	$	2.28	$	1.18

Revenue from Contracts with Customers

12 Months Ended

Sep. 30, 2021

Revenue from Contracts with Customers [Abstract]

Revenue from Contracts with Customers

Note 19. Revenue from Contracts with Customers

All of the Company’s revenue from contracts with customers in the scope of ASC 606 is recognized within Non-Interest Income. The following table presents the Company’s sources of non-interest income. Items outside the scope of ASC 606 are noted as such.

	Year Ended September 30,
(in thousands)	2021		2020
Loan fees and service charges⁽¹⁾	$	703	$	301
Loan servicing income⁽¹⁾		504		84
Service charges on deposit accounts		127		62
Net gain on sale of investments available-for-sale⁽¹⁾		240		-
Net gain on sale of loans held-for-sale⁽¹⁾		1,307		917
Other income⁽²⁾		468		-
Total non-interest income	$	3,349	$	1,364

(1) Not included within the scope of ASC 606

(2) Other income for the year ended September 30, 2021 includes $9 of merchant card processing fees, which are included in the scope of ASC 606. The remaining $457 represents recoveries on acquired loans, which are not included in the scope of ASC 606

A description of the Company’s revenue streams included in the scope of ASC 606 is as follows:

Service Charges on Deposit Accounts: The Company earns fees from its deposit customers for transaction-based, account maintenance, and overdraft services. Service-based fees, which include services such as ATM use fees, stop payment charges, wire transfers, and ACH fees, are recognized at the time the transaction is executed as that is the point in time the Company fulfills its performance obligation to the customer. Account maintenance fees, which primarily relate to monthly maintenance, are earned over the course of a month, representing the period over which the Company satisfies its performance obligation. Overdraft fees are recognized at the point in time that the overdraft occurs. Service charges on customer accounts are withdrawn from the customer’s account balance.

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-URI http://asc.fasb.org/topic&trid=49130388

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 10
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130551-203045

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (b)(2)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130556-203045

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 9
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130550-203045

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (e)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 15
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130558-203045

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

Summary of Significant Accounting Policies, Allowance for Loan Losses (Details)	12 Months Ended
	Sep. 30, 2021
Allowance For Loan Losses [Abstract]
Historical loss lookback period	3 years

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2021	Sep. 30, 2020
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME [Abstract]
Net income	$ 10,851	$ 4,974
Other comprehensive income, net of tax:
Change in unrealized gain on investment securities available-for-sale, net of tax of $77 and $35, respectively	291	134
Reclassification adjustment for gains realized in net income, net of tax of $49 and $0, respectively	(191)	0
Total other comprehensive income, net of tax	100	134
Total comprehensive income, net of tax	$ 10,951	$ 5,108

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

Components of Premises and Equipment

Summary of Significant Accounting Policies, Loan Modifications Under the CARES Act (Details) $ in Millions	12 Months Ended
	Sep. 30, 2021 USD ($)
Loan Modifications Under the CARES Act [Abstract]
Total loan modifications under CARES Act	$ 220.4
Remaining loan modifications under the CARES Act	19.5
Paycheck Protection Program [Member]
Loan Modifications Under the CARES Act [Abstract]
Amount of loans originated	366.1
Amount of loans forgiven	$ 225.4
Paycheck Protection Program [Member] \| Minimum [Member]
Loan Modifications Under the CARES Act [Abstract]
Repayment period	2 years
Paycheck Protection Program [Member] \| Maximum [Member]
Loan Modifications Under the CARES Act [Abstract]
Repayment period	5 years

Premises and Equipment (Tables)

12 Months Ended

Sep. 30, 2021

Premises and Equipment [Abstract]

The following table details the components of premises and equipment:

	September 30,
(in thousands)	2021			2020
Land	$	1,600		$	1,600
Buildings and improvements		9,974			9,434
Leasehold improvements		2,354			2,001
Furniture, fixtures and equipment		5,269			5,454
Construction in progress		1,124			329
		20,321			18,818
Less: Accumulated depreciation and amortization		(5,318	)		(4,662	)
Premises and equipment, net	$	15,003		$	14,156

Regulatory Matters (Details) $ in Thousands	12 Months Ended
Regulatory Matters (Details) $ in Thousands	Sep. 30, 2021 USD ($)	Sep. 30, 2020 USD ($)
Total capital to risk-weighted assets [Abstract]
Actual capital, Amount	$ 132,554	$ 95,079
Actual capital, Ratio	0.1559	0.2057
Minimum capital adequacy requirement, Amount	$ 68,040	$ 36,970
Minimum capital adequacy requirement, Ratio	0.0800	0.0800
Minimum capital adequacy requirement with capital conservation buffer, Amount	$ 89,303	$ 48,523
Minimum capital adequacy requirement with capital conservation buffer, Ratio	0.1050	0.1050
Minimum to be well capitalized under prompt corrective action provisions, Amount	$ 85,050	$ 46,212
Minimum to be well capitalized under prompt corrective action provisions, Ratio	0.1000	0.1000
Tier 1 capital to risk-weighted assets [Abstract]
Actual capital, Amount	$ 123,666	$ 89,275
Actual capital, Ratio	0.1454	0.1932
Minimum capital adequacy requirement, Amount	$ 51,030	$ 27,727
Minimum capital adequacy requirement, Ratio	0.0600	0.0600
Minimum capital adequacy requirement with capital conservation buffer, Amount	$ 72,293	$ 39,281
Minimum capital adequacy requirement with capital conservation buffer, Ratio	0.0850	0.0850
Minimum to be well capitalized under prompt corrective action provisions, Amount	$ 68,040	$ 36,970
Minimum to be well capitalized under prompt corrective action provisions, Ratio	0.0800	0.0800
Common equity tier 1 capital to risk-weighted assets [Abstract]
Actual capital, Amount	$ 123,666	$ 89,275
Actual capital, Ratio	0.1454	0.1932
Minimum capital adequacy requirement, Amount	$ 38,273	$ 20,796
Minimum capital adequacy requirement, Ratio	0.0450	0.0450
Minimum capital adequacy requirement with capital conservation buffer, Amount	$ 59,535	$ 32,349
Minimum capital adequacy requirement with capital conservation buffer, Ratio	0.0700	0.0700
Minimum to be well capitalized under prompt corrective action provisions, Amount	$ 55,283	$ 30,038
Minimum to be well capitalized under prompt corrective action provisions, Ratio	0.0650	0.0650
Tier 1 capital to average total assets [Abstract]
Actual capital, Amount	$ 123,666	$ 89,275
Actual capital, Ratio	0.0945	0.1122
Minimum capital adequacy requirement, Amount	$ 52,338	$ 31,820
Minimum capital adequacy requirement, Ratio	0.0400	0.0400
Minimum to be well capitalized under prompt corrective action provisions, Amount	$ 65,423	$ 39,775
Minimum to be well capitalized under prompt corrective action provisions, Ratio	0.0500	0.0500
Retained earnings available to pay dividends	$ 28,400

Loans (Tables)

12 Months Ended

Sep. 30, 2021

Loans [Abstract]

Major Classifications of Loans

The following table sets forth the major classifications of loans:

	September 30,
(in thousands)	2021			2020
Real estate:
Residential	$	444,011		$	454,073
Multi-family		266,294			136,539
Commercial		348,641			113,615
Total real estate		1,058,946			704,227
Commercial and industrial		172,274			21,100
Construction		15,374			-
Consumer		11			24
		1,246,605			725,351
Deferred loan fees and costs, net		520			(332	)
Total loans		1,247,125			725,019
Allowance for loan losses		(8,552	)		(7,869	)
Net loans	$	1,238,573		$	717,150

Carrying Amount for Purchased Credit Impaired Loans

(in thousands)
Commercial real estate	$	8,324
Commercial and industrial		1,917
Total recorded investment	$	10,241

Changes in Accretable Difference on Purchased Loans

The following table presents a summary of changes in accretable difference on purchased loans accounted for under ASC 310-30:

(in thousands)	Year Ended September 30, 2021
Balance at beginning of period	$	-
Accretable differences acquired		540
Accretion		(194	)
Adjustments to accretable difference due to changes in expected cash flows		-
Ending balance	$	346

Loan Portfolio Based on Internal Rating Category

The following tables represent loans categorized by class and internally assigned risk grades.

	September 30, 2021
(in thousands)	Pass		Special Mention		Substandard		Doubtful		Total
Real Estate:
Residential	$	433,299	$	5,115	$	5,594	$	3	$	444,011
Multi-family		262,984		2,852		458		-		266,294
Commercial		316,727		16,274		15,640		-		348,641
Commercial and industrial		168,104		540		3,630		-		172,274
Construction		13,607		1,767		-		-		15,374
Consumer		11		-		-		-		11
Total loans	$	1,194,732	$	26,548	$	25,322	$	3	$	1,246,605

	September 30, 2020
(in thousands)	Pass		Special Mention		Substandard		Doubtful		Total
Real Estate:
Residential	$	449,834	$	3,702	$	537	$	-	$	454,073
Multi-family		135,197		1,294		48		-		136,539
Commercial		111,314		893		1,408		-		113,615
Commercial and industrial		20,767		-		333		-		21,100
Construction		-		-		-		-		-
Consumer		24		-		-		-		24
Total loans	$	717,136	$	5,889	$	2,326	$	-	$	725,351

Aging of Recorded Investment in Past Due and Non-accrual Loans by Portfolio Segment

The following table represents the aging of the recorded investment in past due and non-accrual loans as of September 30, 2021 and 2020 by portfolio segment:

	September 30, 2021
(in thousands)	30-59 Days Past Due		60-89 Days Past Due		Greater than 89 days Past Due		Non-accrual			Total past due and Non-accrual		Purchased Credit Impaired		Current		Total Loans
Real Estate:
Residential	$	1,032	$	1,601	$	-	$	5,554	(1)	$	8,187	$	-	$	435,953	$	444,140
Multi-family		-		-		-		458	(2)		458		-		266,256		266,714
Commercial		1,939		-		-		1,016	(3)		2,955		8,324		337,528		348,807
Commercial and industrial		3,641		-		-		-			3,641		1,917		166,519		172,077
Construction		-		-		-		-			-		-		15,374		15,374
Consumer		-		-		-		-			-		-		13		13
Total loans	$	6,612	$	1,601	$	-	$	7,028		$	15,241	$	10,241	$	1,221,643	$	1,247,125

(1)	Of the residential real estate non-accrual loans, $1,026 were 61 days past due and $4,528 were greater than 89 days past due.

(2)	Multi-family non-accrual loans at September 30, 2021 were greater than 89 days past due.

(3)	Commercial real estate non-accrual loans at September 30, 2021 were greater than 89 days past due.

	September 30, 2020
(in thousands)	30-59 Days Past Due		60-89 Days Past Due		Greater than 89 days Past Due		Non-accrual(1)		Total past due and Non-accrual		Purchased Credit Impaired		Current		Total Loans
Real Estate:
Residential	$	4,507	$	-	$	-	$	538	$	5,045	$	-	$	448,715	$	453,760
Multi-family		-		-		-		47		47		-		136,690		136,737
Commercial		-		-		296		34		330		-		113,428		113,758
Commercial and industrial		-		-		-		334		334		-		20,404		20,738
Consumer		-		-		-		-		-		-		26		26
Total loans	$	4,507	$	-	$	296	$	953	$	5,756	$	-	$	719,263	$	725,019

(1)	Non-accrual loans at September 30, 2020 were greater than 89 days past due.

Impaired Loans by Portfolio Segment

The following table presents information related to impaired loans by portfolio segment as of and for the years ended September 30, 2021 and 2020:

	September 30, 2021
(in thousands)	Unpaid Principal Balance			Recorded Investment			Allowance for Loan Losses			Interest Income Recognized			Average Recorded Investment
With no related allowance recorded:
Real estate:
Residential		$	7,382		$	7,198		$	-		$	103		$	4,994
Multi-family			382			458			-			7			177
Commercial			522			517			-			3			197
Commercial and industrial			535			500			-			-			173
Total		$	8,821		$	8,673		$	-		$	113		$	5,541

	September 30, 2020
(in thousands)	Unpaid Principal Balance			Recorded Investment			Allowance for Loan Losses			Interest Income Recognized			Average Recorded Investment
With no related allowance recorded:
Real Estate:
Residential		$	2,221		$	2,221		$	-		$	87		$	2,237
Multi-family			47			47			-			16			66
Commercial			629			629			-			44			651
Commercial and industrial			634			334			-			-			634
Total		$	3,531		$	3,231		$	-		$	147		$	3,588

Income Taxes, Net Operating Loss Carryforwards (Details) $ in Thousands	Sep. 30, 2021 USD ($)
Federal [Member]
Net Operating Loss Carryforwards [Abstract]
Net operating loss carryforwards	$ 0
State [Member]
Net Operating Loss Carryforwards [Abstract]
Net operating loss carryforwards	29,700
Net operating loss begin to expire in 2025	12,400
Net operating loss begin to expire in 2026	17,300
City [Member]
Net Operating Loss Carryforwards [Abstract]
Net operating loss carryforwards	9,800
Net operating loss begin to expire in 2025	1,500
Net operating loss begin to expire in 2027	$ 8,300

Regulatory Matters (Tables)

12 Months Ended

Sep. 30, 2021

Regulatory Matters [Abstract]

Capital Amounts and Ratios

The following table sets forth the Bank’s actual capital amounts and ratios under current regulations:

	September 30, 2021
	Actual Capital					Minimum Capital Adequacy Requirement					Minimum Capital Adequacy Requirement with Capital Conservation Buffer					Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions
(in thousands)	Amount		Ratio			Amount		Ratio			Amount		Ratio			Amount		Ratio
Total capital to risk-weighted assets	$	132,554		15.59	%	$	68,040		8.00	%	$	89,303		10.50	%	$	85,050		10.00	%
Tier 1 capital to risk-weighted assets		123,666		14.54			51,030		6.00			72,293		8.50			68,040		8.00
Common equity tier 1 capital to risk-weighted assets		123,666		14.54			38,273		4.50			59,535		7.00			55,283		6.50
Tier 1 capital to average total assets		123,666		9.45			52,338		4.00			N/A		N/A			65,423		5.00

	September 30, 2020
	Actual Capital					Minimum Capital Adequacy Requirement					Minimum Capital Adequacy Requirement with Capital Conservation Buffer					Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions
(in thousands)	Amount		Ratio			Amount		Ratio			Amount		Ratio			Amount		Ratio
Total capital to risk-weighted assets	$	95,079		20.57	%	$	36,970		8.00	%	$	48,523		10.50	%	$	46,212		10.00	%
Tier 1 capital to risk-weighted assets		89,275		19.32			27,727		6.00			39,281		8.50			36,970		8.00
Common equity tier 1 capital to risk-weighted assets		89,275		19.32			20,796		4.50			32,349		7.00			30,038		6.50
Tier 1 capital to average total assets		89,275		11.22			31,820		4.00			N/A		N/A			39,775		5.00

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)
$ in Thousands

12 Months Ended

Sep. 30, 2021

Sep. 30, 2020

Cash flows from operating activities:

Adjustments to reconcile net income to net cash provided by operating activities:

$ 10,851

$ 4,974

Provision for loan losses

1,000

1,250

Depreciation and amortization

1,444

1,343

Originations of loans held for sale

(5,337)

Proceeds from sales of loans held for sale

5,338

Net gain on sale of loans

^[1]

(1,307)

(917)

Stock-based compensation

901

766

Net gain on sale of securities available for sale

^[1]

(240)

Net accretion of premiums, discounts and loan fees and costs

(3,604)

(282)

Amortization of intangible assets

Amortization of debt issuance costs

Loan servicing rights valuation adjustments

251

111

Deferred tax expense

365

202

Decrease (increase) in accrued interest receivable

1,924

(3,501)

Decrease (increase) in other assets

1,398

(1,180)

Decrease in accrued interest payable

(134)

(157)

Increase (decrease) in other liabilities

239

(2,052)

Net cash provided by operating activities

13,192

566

Cash flows from investing activities:

Purchases of securities available for sale

(4,700)

(5,000)

Purchases of restricted securities

(494)

(1,155)

Principal repayments of securities held to maturity

2,100

1,288

Principal repayments of securities available for sale

338

Redemptions of restricted securities

1,645

2,513

Proceeds from sales of loans

46,640

32,561

Net decrease (increase) in loans

16,996

(36,438)

Proceeds from sales of securities available for sale

3,240

Purchases of premises and equipment

(2,079)

(1,093)

Cash acquired in business combination

59,155

Cash consideration paid in acquisition

(32,991)

Net cash provided by (used in) investing activities

89,850

(7,290)

Cash flows from financing activities:

Net increase in deposits

157,725

14,474

Net decrease in federal funds purchased

Advances of term FHLB borrowings

23,940

Repayments of Federal Home Loan Bank advances

(34,758)

(55,688)

Advances of FRB borrowings

16,255

Repayments of Federal Reserve Bank borrowings

(149,242)

(98)

Proceeds from issuance of subordinated debentures, net of issuance costs

24,455

Repayment of note payable

(15,000)

Net proceeds from stock options exercised

107

Net proceeds from issuance of common stock

113

112

Net cash used in financing activities

(16,707)

(898)

Net increase (decrease) in cash and cash equivalents

86,335

(7,622)

Cash and cash equivalents, beginning of period

80,209

87,831

Cash and cash equivalents, end of period

166,544

80,209

Supplemental cash flow information:

Interest paid

7,101

13,168

Income taxes paid

1,375

1,243

Supplemental noncash disclosures:

Transfers from portfolio loans to loans held-for-sale

47,826

31,668

Transfers from loans held-for-sale to portfolio loans

2,493

Business combination:

Fair value of tangible assets acquired

653,380

Goodwill and other intangible assets

17,947

Liabilities assumed

605,815

Common stock issued in business combination

31,252

Stock options rolled over in acquisition

$ 1,269

$ 0

[1]	Not included within the scope of ASC 606

Summary of Significant Accounting Policies, Goodwill and Other Intangible Assets (Details)	12 Months Ended
	Sep. 30, 2021
Core Deposits [Member]
Goodwill and Other Intangible Assets [Abstract]
Estimated useful life of intangible assets	10 years

Revenue from Contracts with Customers (Tables)

12 Months Ended

Sep. 30, 2021

Revenue from Contracts with Customers [Abstract]

Sources of Non-Interest Income

The following table presents the Company’s sources of non-interest income. Items outside the scope of ASC 606 are noted as such.

	Year Ended September 30,
(in thousands)	2021		2020
Loan fees and service charges⁽¹⁾	$	703	$	301
Loan servicing income⁽¹⁾		504		84
Service charges on deposit accounts		127		62
Net gain on sale of investments available-for-sale⁽¹⁾		240		-
Net gain on sale of loans held-for-sale⁽¹⁾		1,307		917
Other income⁽²⁾		468		-
Total non-interest income	$	3,349	$	1,364

(1) Not included within the scope of ASC 606

CONSOLIDATED STATEMENTS OF INCOME - USD ($)
$ in Thousands

12 Months Ended

Sep. 30, 2021

Sep. 30, 2020

INTEREST INCOME

Interest on loans

$ 47,685

$ 38,641

Interest and dividends on investment securities

685

523

Federal funds sold

107

Other interest income

304

862

Total interest income

48,675

40,133

INTEREST EXPENSE

Savings, NOW and money market deposits

903

1,445

Time deposits

3,822

9,180

Provision for loan losses

2,242

2,386

Total interest expense

6,967

13,011

Net interest income

41,708

27,122

1,000

1,250

Net interest income after provision for loan losses

40,708

25,872

NON-INTEREST INCOME

Loan fees and service charges

703

301

Loan servicing income

504

Service charges on deposit accounts

127

Gain on sale of investment securities available-for-sale, net

^[1]

240

Gain on sale of loans held-for-sale

^[1]

1,307

917

Other income

^[2]

468

Total non-interest income

3,349

1,364

NON-INTEREST EXPENSE

Salaries and employee benefits

15,009

11,182

Occupancy and equipment

4,978

4,462

Data processing

1,280

911

Advertising and promotion

118

296

Acquisition costs

4,430

450

Professional fees

1,706

2,070

Other expenses

2,484

1,651

Total non-interest expense

30,005

21,022

Income before income tax expense

14,052

6,214

Income tax expense

3,201

1,240

Basic (in dollars per share)

$ 10,851

$ 4,974

Earnings per share:

$ 2.32

$ 1.20

Diluted (in dollars per share)

$ 2.28

$ 1.18

Weighted average shares outstanding [Abstract]

Basic (in shares)

4,669,009

4,162,280

Diluted (in shares)

4,758,669

4,226,967

[1]	Not included within the scope of ASC 606
[2]	Other income for the year ended September 30, 2021 includes $9 of merchant card processing fees, which are included in the scope of ASC 606. The remaining $457 represents recoveries on acquired loans, which are not included in the scope of ASC 606

Parent Company Only Condensed Financial Information (Tables)

12 Months Ended

Sep. 30, 2021

Parent Company Only Condensed Financial Information [Abstract]

Balance Sheets

	September 30,
(in thousands)	2021		2020
ASSETS
Cash and deposits due from banks	$	571	$	514
Investment in bank		146,232		91,792
Other assets		1,050		755
Total Assets	$	147,853	$	93,061

LIABILITIES AND STOCKHOLDERS' EQUITY
Note payable	$	-	$	14,984
Subordinated debentures		24,513		-
Accrued interest payable		576		34
Accrued expenses and other liabilities		235		-
Total Liabilities		25,324		15,018
Total Stockholders' equity		122,529		78,043
Total Liabilities and Stockholders' Equity	$	147,853	$	93,061

Statements of Income

	September 30,
(in thousands)	2021			2020
Interest income	$	-		$	3
Interest expense		1,361			895
Loss before income taxes and equity in undistributed earnings of the bank		(1,361	)		(892	)
Income tax benefit		296			187
Equity in undistributed earnings of the bank		11,916			5,679
Net Income	$	10,851		$	4,974

Statements of Cash Flows

	September 30,
(in thousands)	2021			2020
Cash flows from operating activities:
Net income	$	10,851		$	4,974
Adjustments to reconcile net income to net cash used in operating activities:
Equity in undistributed earnings of the bank		(11,916	)		(5,679	)
Amortization of debt issuance costs		72			3
Increase in other assets		(295	)		(187	)
Increase in accrued interest payable		542			29
Increase (decrease) in other liabilities		235			(13	)
Net cash used in operating activities		(511	)		(873	)

Cash flows from investing activities:
Investment in bank		(9,000	)		-
Net cash used in investing activities		(9,000	)		-

Cash flows from financing activities:
Proceeds from issuance of subordinated debentures, net of issuance costs		24,455			-
Repayment of note payable		(15,000	)		-
Net proceeds from stock options exercised		-			107
Net proceeds from issuance of common stock		113			112
Net cash provided by financing activities		9,568			219
Net increase (decrease) in cash and cash equivalents		57			(654	)
Cash and cash equivalents, beginning of period		514			1,168
Cash and cash equivalents, end of period	$	571		$	514

Supplemental non-cash disclosures:
Common stock issued in acquisition	$	31,252		$	-
Stock options rolled over in acquisition		1,269			-

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands	Common Stock [Member]	Capital in Excess of Par [Member]	Retained Earnings [Member]	Accumulated Other Comprehensive Income [Member]	Total
Balance at Sep. 30, 2019	$ 42	$ 62,740	$ 9,146	$ 22	$ 71,950
Balance (in shares) at Sep. 30, 2019	4,162,904
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	$ 0	0	4,974	0	4,974
Other comprehensive income, net of tax	0	0	0	134	134
Stock-based compensation, net	$ 0	766	0	0	766
Stock-based compensation, net (in shares)	(3,597)
Exercise of stock options	$ 0	107	0	0	107
Exercise of stock options (in shares)	10,735
Issuance of common stock	$ 0	112	0	0	112
Issuance of common stock (in shares)	5,102
Balance at Sep. 30, 2020	$ 42	63,725	14,120	156	78,043
Balance (in shares) at Sep. 30, 2020	4,175,144
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	$ 0	0	10,851	0	10,851
Other comprehensive income, net of tax	0	0	0	100	100
Common stock issued in purchase of Savoy	$ 14	31,238	0	0	31,252
Common stock issued in purchase of Savoy (in shares)	1,357,567
Savoy acquisition rollover options value	$ 0	1,269	0	0	1,269
Savoy acquisition rollover options value (in shares)	0
Stock-based compensation, net	$ 0	901	0	0	901
Stock-based compensation, net (in shares)	25,588
Issuance of common stock	$ 0	113	0	0	113
Issuance of common stock (in shares)	5,127
Balance at Sep. 30, 2021	$ 56	$ 97,246	$ 24,971	$ 256	$ 122,529
Balance (in shares) at Sep. 30, 2021	5,563,426

Fair Value Measurements, Assets Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Sep. 30, 2020
Financial Assets [Abstract]
Available-for-sale securities	$ 7,747	$ 6,035
Mortgage servicing rights	3,690	155
U.S. GSE Securities [Member] \| Residential Mortgage Backed Securities [Member]
Financial Assets [Abstract]
Available-for-sale securities	833	962
Corporate Bonds [Member]
Financial Assets [Abstract]
Available-for-sale securities	6,914	5,073
Recurring [Member]
Financial Assets [Abstract]
Total	11,437	6,190
Recurring [Member] \| U.S. GSE Securities [Member] \| Residential Mortgage Backed Securities [Member]
Financial Assets [Abstract]
Available-for-sale securities	833	962
Recurring [Member] \| Corporate Bonds [Member]
Financial Assets [Abstract]
Available-for-sale securities	6,914	5,073
Recurring [Member] \| Mortgage Servicing Rights [Member]
Financial Assets [Abstract]
Mortgage servicing rights	3,690	155
Recurring [Member] \| Quoted Prices in Active Markets for Identical Assets (Level 1) [Member]
Financial Assets [Abstract]
Total	0	0
Recurring [Member] \| Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] \| U.S. GSE Securities [Member] \| Residential Mortgage Backed Securities [Member]
Financial Assets [Abstract]
Available-for-sale securities	0	0
Recurring [Member] \| Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] \| Corporate Bonds [Member]
Financial Assets [Abstract]
Available-for-sale securities	0	0
Recurring [Member] \| Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] \| Mortgage Servicing Rights [Member]
Financial Assets [Abstract]
Mortgage servicing rights	0	0
Recurring [Member] \| Significant Other Observable Inputs (Level 2) [Member]
Financial Assets [Abstract]
Total	7,747	6,035
Recurring [Member] \| Significant Other Observable Inputs (Level 2) [Member] \| U.S. GSE Securities [Member] \| Residential Mortgage Backed Securities [Member]
Financial Assets [Abstract]
Available-for-sale securities	833	962
Recurring [Member] \| Significant Other Observable Inputs (Level 2) [Member] \| Corporate Bonds [Member]
Financial Assets [Abstract]
Available-for-sale securities	6,914	5,073
Recurring [Member] \| Significant Other Observable Inputs (Level 2) [Member] \| Mortgage Servicing Rights [Member]
Financial Assets [Abstract]
Mortgage servicing rights	0	0
Recurring [Member] \| Significant Unobservable Inputs (Level 3) [Member]
Financial Assets [Abstract]
Total	3,690	155
Recurring [Member] \| Significant Unobservable Inputs (Level 3) [Member] \| U.S. GSE Securities [Member] \| Residential Mortgage Backed Securities [Member]
Financial Assets [Abstract]
Available-for-sale securities	0	0
Recurring [Member] \| Significant Unobservable Inputs (Level 3) [Member] \| Corporate Bonds [Member]
Financial Assets [Abstract]
Available-for-sale securities	0	0
Recurring [Member] \| Significant Unobservable Inputs (Level 3) [Member] \| Mortgage Servicing Rights [Member]
Financial Assets [Abstract]
Mortgage servicing rights	$ 3,690	$ 155

Business Combinations, Fair Value of Assets Received and Liabilities Assumed (Details) - USD ($)
$ / shares in Units, $ in Thousands

May 26, 2021

Apr. 30, 2021

Sep. 30, 2021

Sep. 30, 2020

Sep. 30, 2019

Common stock, par value (in dollars per share)

$ 0.01

Goodwill

$ 19,168

$ 1,901

$ 1,482

Savoy Bank [Member]

Final aggregate purchase price

$ 65,512

Assets [Abstract]

Cash and due from banks

59,155

Investment securities available-for-sale

239

Loans held for investment

3,883

569,251

Premises and equipment, net

234

Core deposit intangible

Accrued interest receivable

5,171

Other assets

10,432

Total assets acquired

648,365

340,215

Other liabilities and accrued expenses

258,247

Accrued interest payable

1,050

3,817

Total liabilities assumed

603,329

Total consideration

65,512

Savoy Bank [Member] | Measurement Period Adjustments [Member]

Assets [Abstract]

Cash and due from banks

Investment securities available-for-sale

Loans held for investment

^[1]

8,612

Premises and equipment, net

^[2]

(22)

Core deposit intangible

^[3]

490

Accrued interest receivable

^[4]

(650)

Other assets

^[5]

(2,925)

Total assets acquired

5,505

^[6]

2,527

Other liabilities and accrued expenses

^[7]

301

Accrued interest payable

^[8]

(342)

Total liabilities assumed

2,486

Savoy Bank [Member] | As adjusted [Member]

Final aggregate purchase price

65,512

Assets [Abstract]

Cash and due from banks

59,155

Investment securities available-for-sale

239

Loans held for investment

3,883

577,863

Premises and equipment, net

212

Core deposit intangible

490

Accrued interest receivable

4,521

Other assets

7,507

Total assets acquired

653,870

342,742

Other liabilities and accrued expenses

258,548

Accrued interest payable

1,050

3,475

Total liabilities assumed

605,815

Net assets acquired

48,055

Total consideration

65,512

Goodwill

$ 17,457

Savoy Bank [Member] | Common Stock [Member]

Common stock, par value (in dollars per share)

$ 1.00

Cash paid, per share (in dollars per share)

$ 3.246

Number of shares issued for each share of common stock in conversion of common stock ( in shares)

0.141

Final aggregate purchase price

$ 65,500

Business acquisition share price (in dollars per share)

$ 6.49

Goodwill and Other Intangible Assets [Abstract]

Total consideration

$ 65,500

[1]	Represents the fair value adjustments on net book value of loans, which includes an interest rate mark and credit mark adjustment, the write-off of deferred fees/costs and premiums and the elimination of Savoy’s allowance for loan losses.
[2]	Represents the fair value adjustments to reflect the fair value of premises and equipment.
[3]	Represents the fair value of core deposit intangible recorded, which will be amortized on an accelerated basis over the estimated average life of the deposit base.
[4]	Represents an adjustment to accrued interest receivable acquired.
[5]	Represents an adjustment to other assets acquired. The largest adjustment was the net deferred tax assets resulting from the fair value adjustment related to the acquired assets, liabilities assumed and identifiable intangible assets recorded.
[6]	Represents the fair value adjustments on time deposits, which will be treated as a reduction of interest expense over the remaining term of the time deposits.
[7]	Represents the fair value adjustments on an FHLB borrowing, which will be treated as a reduction to interest expense over the life of the borrowing.
[8]	Represents an adjustment to other liabilities assumed.

Goodwill and Other Intangible Assets, Gross Carrying Amount and Accumulated Amortization (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2019
Other Intangible Assets, Net [Abstract]
Total net book value	$ 480
Weighted-average remaining life of other intangible assets	4 years 4 months 13 days
Core Deposits [Member]
Other Intangible Assets, Net [Abstract]
Gross carrying amount	$ 517	$ 27
Accumulated amortization	(37)	(5)
Total net book value	$ 480	$ 22	$ 27

Summary of Significant Accounting Policies, Supplemental Executive Retirement Plan (Details)	12 Months Ended
	Sep. 30, 2021 FormerExecutive
Supplemental Executive Retirement Plan [Abstract]
Number of former executives benefited	2

Goodwill and Other Intangible Assets

12 Months Ended

Sep. 30, 2021

Goodwill and Other Intangible Assets

Note 9. Goodwill and Other Intangible Assets

FASB ASC 350, Intangibles - Goodwill and Other, requires a company to perform an impairment test on goodwill annually, or more frequently if events or changes in circumstance indicate that the asset might be impaired, by comparing the fair value of such goodwill to its recorded or carrying amount. If the carrying amount of goodwill exceeds the fair value, an impairment charge must be recorded in an amount equal to the excess.

The following table presents activity for goodwill and other intangible assets, which consist of core deposit intangibles:

	September 30,
(in thousands)	2021			2020
Goodwill at beginning of period	$	1,901		$	1,482
Acquisition		17,457			-
Measurement period adjustment for previous acquisition		(190	)		419
Goodwill at end of period	$	19,168		$	1,901

Other intangible assets at beginning of period	$	22		$	27
Acquisition		490			-
Amortization		(32	)		(5	)
Other intangible assets at end of period	$	480		$	22

The Company has identified one reporting units for purposes of testing goodwill for impairment, which is the Company as a whole.

Impairment exists when a reporting unit’s carrying value of goodwill exceeds its fair value. At August 31, 2021, the Company’s reporting unit had positive equity and the Company elected to perform a qualitative assessment to determine if it was more likely than not that the fair value of the reporting unit exceeded its carrying value, including goodwill. The qualitative assessment indicated that it was more likely than not that the fair value of the reporting unit exceeded its carrying value, resulting in no impairment.

The following table presents the gross carrying amount and accumulated amortization for the Company’s other intangible assets, which consists of core deposit intangibles:

	September 30,
(in thousands)	2021			2020
Gross carrying amount	$	517		$	27
Accumulated amortization		(37	)		(5	)
Net book value	$	480		$	22

At September 30, 2021, the weighted-average remaining life of the Company's other intangible assets was 4.37 years.

The following table presents estimated future amortization expense for other intangible assets:

(in thousands)
2022	$	81
2023		72
2024		63
2025		55
2026		49
Thereafter		160
Total	$	480

Accumulated Other Comprehensive Income

12 Months Ended

Sep. 30, 2021

Accumulated Other Comprehensive Income [Abstract]

Accumulated Other Comprehensive Income

Note 18. Accumulated Other Comprehensive Income

The following is changes in accumulated other comprehensive income by component, net of tax, for the years ending September 30, 2021 and 2020:

(in thousands)	Unrealized Gains and Losses on Available- for-Sale Debt Securities			Total
Balance at October 1, 2020	$	156		$	156
Other comprehensive income, before reclassification		291			291
Amount reclassified from accumulated other comprehensive income		(191	)		(191	)
Balance at September 30, 2021	$	256		$	256

(in thousands)	Unrealized Gains and Losses on Available- for-Sale Debt Securities		Total
Balance at October 1, 2019	$	22	$	22
Other comprehensive income		134		134
Balance at September 30, 2020	$	156	$	156

The following is significant amounts reclassified out of accumulated other comprehensive income for the year ended September 30, 2021:

(in thousands)	Amount Reclassified from Accumulated Other Comprehensive Income			Affected Line Item in Statement of Income
Realized gains on securities available-for-sale	$	240		Gain on sale of investment securities available-for-sale, net
Tax effect		(49	)	Income tax expense
Net of tax	$	191

Allowance for Loan Losses, Activity in Allowance for Loan Losses by Portfolio Segment (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2021	Sep. 30, 2020
Allowance for loan losses by portfolio segment [Roll Forward]
Beginning balance	$ 7,869	$ 7,143
Provision for loan losses	1,000	1,250
Loans charged-off	(329)	(524)
Recoveries	12	0
Ending balance	8,552	7,869
Residential Real Estate [Member]
Allowance for loan losses by portfolio segment [Roll Forward]
Beginning balance	5,103	4,647
Provision for loan losses	(681)	456
Loans charged-off	(267)	0
Recoveries	0	0
Ending balance	4,155	5,103
Multi-Family [Member]
Allowance for loan losses by portfolio segment [Roll Forward]
Beginning balance	1,506	1,215
Provision for loan losses	959	291
Loans charged-off	(32)	0
Recoveries	0	0
Ending balance	2,433	1,506
Commercial Real Estate [Member]
Allowance for loan losses by portfolio segment [Roll Forward]
Beginning balance	1,221	1,193
Provision for loan losses	693	252
Loans charged-off	(30)	(224)
Recoveries	0	0
Ending balance	1,884	1,221
Commercial and Industrial [Member]
Allowance for loan losses by portfolio segment [Roll Forward]
Beginning balance	38	75
Provision for loan losses	29	263
Loans charged-off	0	(300)
Recoveries	12	0
Ending balance	79	38
Construction [Member]
Allowance for loan losses by portfolio segment [Roll Forward]
Beginning balance	0	0
Provision for loan losses	0	0
Loans charged-off	0	0
Recoveries	0	0
Ending balance	0	0
Consumer [Member]
Allowance for loan losses by portfolio segment [Roll Forward]
Beginning balance	1	13
Provision for loan losses	0	(12)
Loans charged-off	0	0
Recoveries	0	0
Ending balance	$ 1	$ 1

Loans, Impaired Loans (Details) - USD ($) $ in Thousands	12 Months Ended
Loans, Impaired Loans (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Sep. 30, 2020
With no related allowance recorded [Abstract]
Unpaid principal balance	$ 8,821	$ 3,531
Recorded investment	8,673	3,231
Average recorded investment and interest income recognized [Abstract]
Interest income recognized	113	147
Average recorded investment	5,541	3,588
Residential Real Estate [Member]
With no related allowance recorded [Abstract]
Unpaid principal balance	7,382	2,221
Recorded investment	7,198	2,221
Average recorded investment and interest income recognized [Abstract]
Interest income recognized	103	87
Average recorded investment	4,994	2,237
Multi-Family [Member]
With no related allowance recorded [Abstract]
Unpaid principal balance	382	47
Recorded investment	458	47
Average recorded investment and interest income recognized [Abstract]
Interest income recognized	7	16
Average recorded investment	177	66
Commercial Real Estate [Member]
With no related allowance recorded [Abstract]
Unpaid principal balance	522	629
Recorded investment	517	629
Average recorded investment and interest income recognized [Abstract]
Interest income recognized	3	44
Average recorded investment	197	651
Commercial and Industrial [Member]
With no related allowance recorded [Abstract]
Unpaid principal balance	535	634
Recorded investment	500	334
Average recorded investment and interest income recognized [Abstract]
Interest income recognized	0	0
Average recorded investment	$ 173	$ 634

Equity Compensation Plans, 2021 and 2018 Equity Compensation Plans (Details)	12 Months Ended
	Sep. 30, 2021 shares
2021 Plan [Member]
Equity Compensation Plans [Abstract]
Number of common shares approved for issuance (in shares)	427,500
Number of shares available for issuance (in shares)	427,500
2018 Plan [Member]
Equity Compensation Plans [Abstract]
Number of common shares approved for issuance (in shares)	346,000
Number of shares available for issuance (in shares)	195,848
Stock Options [Member]
Equity Compensation Plans [Abstract]
Number of Savoy options converted (in shares)	71,900

Fair Value Measurements, Changes in Mortgage Servicing Rights (Details) - Mortgage Servicing Rights [Member] - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2021	Sep. 30, 2020
Changes in Mortgage Servicing Rights [Roll Forward]
Beginning balance	$ 155	$ 266
Loan servicing rights obtained from acquisition of Savoy	3,777	0
Additions	10	0
Adjustment to fair value	(252)	(111)
Ending balance	$ 3,690	$ 155

Loans, Troubled Debt Restructurings (Details) $ in Millions	12 Months Ended
Loans, Troubled Debt Restructurings (Details) $ in Millions	Sep. 30, 2021 USD ($) Loan	Sep. 30, 2020 USD ($) Loan
Loans [Abstract]
Number of recorded loans classified as TDR's \| Loan	6	6
Recorded investment in TDRs \| $	$ 1.6	$ 1.7
Specific reserves allocated to troubled debt restructurings \| $	0.0	0.0
Commitments to lend additional funds in troubled debt restructurings \| $	$ 0.0	$ 0.0
TDR's with subsequent payment default \| Loan	0	0
Threshold period for payment default	90 days
Number of newly added TDR's \| Loan	0	0

Income Taxes, Reconciliation of Reported Income Tax Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2021	Sep. 30, 2020
Effective Income Tax Rate Reconciliation, Amount [Abstract]
Federal income tax expense computed by applying the statutory rate to income before income taxes	$ 2,951	$ 1,305
State taxes, net of federal benefit	48	(646)
Non-deductible transaction costs	204	43
Other	(356)	(392)
Valuation allowance	354	930
Total income tax expense	$ 3,201	$ 1,240
Effective Income Tax Rate Reconciliation, Percent of Pre-tax Earnings [Abstract]
Federal income tax expense computed by applying the statutory rate to income before income taxes	21.00%	21.00%
State taxes, net of federal benefit	0.30%	(10.40%)
Non-deductible transaction costs	1.50%	0.70%
Other	(2.50%)	(6.30%)
Valuation allowance	2.50%	15.00%
Income tax expense	22.80%	20.00%

Deposits

12 Months Ended

Sep. 30, 2021

Deposits [Abstract]

Parent Company Only Condensed Financial Information [Abstract]

Note 7. Deposits

The following table details the components of deposits:

	September 30,
(in thousands)	2021		2020
Non-interest bearing:
Demand	$	191,537	$	82,350
Interest-bearing:
NOW		353,977		34,086
Money market		181,148		110,353
Savings		60,164		43,218
Time deposits $250,000 and greater		60,242		78,628
Time deposits less than $250,000		317,594		316,125
Total interest-bearing		973,125		582,410
Total deposits	$	1,164,662	$	664,760

The scheduled maturities of time deposits are as follows:

	September 30,
(in thousands)	2021
2022	$	277,431
2023		49,059
2024		25,248
2025		18,002
2026		7,104
Thereafter		992
Total	$	377,836

Parent Company Only Condensed Financial Information

12 Months Ended

Sep. 30, 2021

Parent Company Only Condensed Financial Information

Note 16. Parent Company Only Condensed Financial Information

Condensed parent company only financial statements of Hanover Bancorp, Inc. are as follows:

Balance Sheets

	September 30,
(in thousands)	2021		2020
ASSETS
Cash and deposits due from banks	$	571	$	514
Investment in bank		146,232		91,792
Other assets		1,050		755
Total Assets	$	147,853	$	93,061

LIABILITIES AND STOCKHOLDERS' EQUITY
Note payable	$	-	$	14,984
Subordinated debentures		24,513		-
Accrued interest payable		576		34
Accrued expenses and other liabilities		235		-
Total Liabilities		25,324		15,018
Total Stockholders' equity		122,529		78,043
Total Liabilities and Stockholders' Equity	$	147,853	$	93,061

Statements of Income

	September 30,
(in thousands)	2021			2020
Interest income	$	-		$	3
Interest expense		1,361			895
Loss before income taxes and equity in undistributed earnings of the bank		(1,361	)		(892	)
Income tax benefit		296			187
Equity in undistributed earnings of the bank		11,916			5,679
Net Income	$	10,851		$	4,974

Statements of Cash Flows

	September 30,
(in thousands)	2021			2020
Cash flows from operating activities:
Net income	$	10,851		$	4,974
Adjustments to reconcile net income to net cash used in operating activities:
Equity in undistributed earnings of the bank		(11,916	)		(5,679	)
Amortization of debt issuance costs		72			3
Increase in other assets		(295	)		(187	)
Increase in accrued interest payable		542			29
Increase (decrease) in other liabilities		235			(13	)
Net cash used in operating activities		(511	)		(873	)

Cash flows from investing activities:
Investment in bank		(9,000	)		-
Net cash used in investing activities		(9,000	)		-

Cash flows from financing activities:
Proceeds from issuance of subordinated debentures, net of issuance costs		24,455			-
Repayment of note payable		(15,000	)		-
Net proceeds from stock options exercised		-			107
Net proceeds from issuance of common stock		113			112
Net cash provided by financing activities		9,568			219
Net increase (decrease) in cash and cash equivalents		57			(654	)
Cash and cash equivalents, beginning of period		514			1,168
Cash and cash equivalents, end of period	$	571		$	514

Supplemental non-cash disclosures:
Common stock issued in acquisition	$	31,252		$	-
Stock options rolled over in acquisition		1,269			-

Loans, Classification of Loans (Details) - USD ($)
$ in Thousands

12 Months Ended

Sep. 30, 2021

Sep. 30, 2020

Sep. 30, 2019

Classification of Loans by Loan Portfolio Segment [Abstract]

Deferred loan fees and costs, net

$ 1,246,605

$ 725,351

520

(332)

1,247,125

725,019

Loans held for investment, net

(8,552)

(7,869)

$ (7,143)

1,238,573

717,150

Servicing of loans to others

233,200

26,800

Amount from sale of loans

46,600

37,000

Recognized net gains amount

^[1]

1,307

917

Real Estate Loans [Member]

Classification of Loans by Loan Portfolio Segment [Abstract]

Classification of Loans by Loan Portfolio Segment [Abstract]

1,058,946

704,227

Residential [Member]

444,140

453,760

Residential [Member] | Real Estate Loans [Member]

(4,155)

(5,103)

(4,647)

Classification of Loans by Loan Portfolio Segment [Abstract]

444,011

454,073

Classification of Loans by Loan Portfolio Segment [Abstract]

444,140

453,760

Multi-Family [Member]

266,714

136,737

Multi-Family [Member] | Real Estate Loans [Member]

(2,433)

(1,506)

(1,215)

Classification of Loans by Loan Portfolio Segment [Abstract]

266,294

136,539

Classification of Loans by Loan Portfolio Segment [Abstract]

266,714

136,737

Commercial [Member]

348,807

113,758

Commercial [Member] | Real Estate Loans [Member]

(1,884)

(1,221)

(1,193)

Classification of Loans by Loan Portfolio Segment [Abstract]

348,641

113,615

Commercial and Industrial [Member]

348,807

113,758

Classification of Loans by Loan Portfolio Segment [Abstract]

172,274

21,100

172,077

20,738

Classification of Loans by Loan Portfolio Segment [Abstract]

(79)

(38)

(75)

Construction [Member]

15,374

15,374

Classification of Loans by Loan Portfolio Segment [Abstract]

Consumer [Member]

Components of Income Tax Expense

$ (1)

$ (13)

[1]	Not included within the scope of ASC 606

Premises and Equipment

12 Months Ended

Sep. 30, 2021

Premises and Equipment [Abstract]

Premises and Equipment

Note 6. Premises and Equipment

The following table details the components of premises and equipment:

	September 30,
(in thousands)	2021			2020
Land	$	1,600		$	1,600
Buildings and improvements		9,974			9,434
Leasehold improvements		2,354			2,001
Furniture, fixtures and equipment		5,269			5,454
Construction in progress		1,124			329
		20,321			18,818
Less: Accumulated depreciation and amortization		(5,318	)		(4,662	)
Premises and equipment, net	$	15,003		$	14,156

Depreciation and amortization was $1.4 million and $1.3 million for the years ended September 30, 2021 and 2020, respectively.

Fair Value Measurements, Assets Measured at Fair Value on Non-recurring Basis (Details) - Nonrecurring [Member] - USD ($) $ in Thousands	Sep. 30, 2021	Sep. 30, 2020
Assets Measured at Fair Value on Non-recurring Basis [Abstract]
Assets measured at fair value	$ 0	$ 0
Liabilities measured at fair value	$ 0	$ 0

Income Taxes (Tables)

12 Months Ended

Sep. 30, 2021

Income Taxes [Abstract]

The following table details the components of income tax expense:

	Year Ended September 30,
(in thousands)	2021			2020
Current:
Federal	$	2,594		$	1,303
State		242			116
Total current		2,836			1,419
Deferred:
Federal		394			91
State		(383	)		(1,200	)
Total deferred		11			(1,109	)
Change in valuation allowance		354			930
Total income tax expense	$	3,201		$	1,240

Reconciliation of Reported Income Tax Expense

The following table reflects a reconciliation of reported income tax expense to the amount that would result from applying the federal statutory rate of 21%:

	Year Ended September 30,
	2021						2020
(in thousands)	Amount			Percentage of Pre-tax Earnings			Amount			Percentage of Pre-tax Earnings
Federal income tax expense computed by applying the statutory rate to income before income taxes	$	2,951			21.0	%		1,305			21.0	%
State taxes, net of federal benefit		48			0.3	%		(646	)		-10.4	%
Non-deductible transaction costs		204			1.5	%		43			0.7	%
Other		(356	)		-2.5	%		(392	)		-6.3	%
Valuation allowance		354			2.5	%		930			15.0	%
Income tax expense	$	3,201			22.8	%	$	1,240			20.0	%

Composition of Deferred Tax Assets and Liabilities

The following table summarizes the composition of deferred tax assets and liabilities:

	September 30,
(in thousands)	2021			2020
Deferred tax assets:
Allowance for loan losses	$	2,602		$	2,468
Organizational costs		76			46
Start-up and other costs		77			115
Net operating loss carryforwards		2,443			1,887
Accrued SERP		1,288			1,462
Purchase accounting fair value adjustments		2,034			-
Other assets		1,984			1,134
Total deferred tax assets		10,504			7,112
Deferred tax liabilities:
Depreciation		(771	)		(734	)
Deferred loan fees/costs		(883	)		(651	)
Purchase accounting fair value adjustments		-			(670	)
Tax bad debt reserve		(204	)		(124	)
Mortgage servicing rights		(1,122	)		(49	)
Unrealized gain on securities AFS		(70	)		(41	)
Total deferred tax liabilities		(3,050	)		(2,269	)
Total		7,454			4,843
Valuation allowance		(3,896	)		(2,765	)
Net deferred tax asset	$	3,558		$	2,078

Parent Company Only Condensed Financial Information, Balance Sheets (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2019
ASSETS [Abstract]
Cash and deposits due from banks	$ 8,302	$ 6,239
Other assets	3,957	3,758
TOTAL ASSETS	1,484,641	851,606
LIABILITIES AND STOCKHOLDERS' EQUITY [Abstract]
Note payable	0	14,984
Subordinated debentures	24,513	0
Accrued interest payable	1,290	374
TOTAL LIABILITIES	1,362,112	773,563
Total Stockholders' equity	122,529	78,043	$ 71,950
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	1,484,641	851,606
Parent Company [Member]
ASSETS [Abstract]
Cash and deposits due from banks	571	514
Investment in bank	146,232	91,792
Other assets	1,050	755
TOTAL ASSETS	147,853	93,061
LIABILITIES AND STOCKHOLDERS' EQUITY [Abstract]
Note payable	0	14,984
Subordinated debentures	24,513	0
Accrued interest payable	576	34
Accrued expenses and other liabilities	235	0
TOTAL LIABILITIES	25,324	15,018
Total Stockholders' equity	122,529	78,043
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$ 147,853	$ 93,061

Investment Securities, Securities Portfolio Presented by Contractual Maturity (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Sep. 30, 2020
Securities Available for Sale, Amortized Cost [Abstract]
Due in one year or less	$ 0
Due after one year through five years	0
Due after five years through ten years	6,700
Due after ten years	0
Amortized cost	7,422	$ 5,838
Securities Available for Sale, Fair Value [Abstract]
Due in one year or less	0
Due after one year through five years	0
Due after five years through ten years	6,914
Due after ten years	0
Fair value	7,747	6,035
Securities Held to Maturity, Amortized Cost [Abstract]
Due in one year or less	0
Due after one year through five years	1,500
Due after five years through ten years	2,000
Due after ten years	0
Amortized cost	8,611	10,727
Securities Held to Maturity, Fair Value [Abstract]
Due in one year or less	0
Due after one year through five years	1,496
Due after five years through ten years	2,009
Due after ten years	0
Fair value	8,865	11,131
Investment securities pledged to secure public deposits	5,100	5,600
Holdings of securities of any one issuer, other than securities issued by U.S. Government sponsored agencies, in amount greater than 10% of shareholders' equity		0
Residential Mortgage Backed Securities [Member]
Securities Available for Sale, Amortized Cost [Abstract]
Without single maturity date	722
Securities Available for Sale, Fair Value [Abstract]
Without single maturity date	833
U.S. GSE Securities [Member] \| Residential Mortgage Backed Securities [Member]
Securities Available for Sale, Amortized Cost [Abstract]
Amortized cost	722	838
Securities Available for Sale, Fair Value [Abstract]
Fair value	833	962
Securities Held to Maturity, Amortized Cost [Abstract]
Without single maturity date	2,417
Amortized cost	2,417	4,478
Securities Held to Maturity, Fair Value [Abstract]
Without single maturity date	2,491
Fair value	2,491	4,596
U.S. GSE Securities [Member] \| Commercial Mortgage Backed Securities [Member]
Securities Held to Maturity, Amortized Cost [Abstract]
Without single maturity date	2,694
Amortized cost	2,694	2,749
Securities Held to Maturity, Fair Value [Abstract]
Without single maturity date	2,869
Fair value	$ 2,869	$ 3,002

Income Taxes, Composition of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Sep. 30, 2020
Deferred tax assets [Abstract]
Allowance for loan losses	$ 2,602	$ 2,468
Organizational costs	76	46
Start-up and other costs	77	115
Net operating loss carryforwards	2,443	1,887
Accrued SERP	1,288	1,462
Purchase accounting fair value adjustments	2,034	0
Other assets	1,984	1,134
Total deferred tax assets	10,504	7,112
Deferred tax liabilities [Abstract]
Depreciation	(771)	(734)
Deferred loan fees/costs	(883)	(651)
Purchase accounting fair value adjustments	0	(670)
Tax bad debt reserve	(204)	(124)
Mortgage servicing rights	(1,122)	(49)
Unrealized gain on securities AFS	(70)	(41)
Total deferred tax liabilities	(3,050)	(2,269)
Total	7,454	4,843
Valuation allowance	(3,896)	(2,765)
Net deferred tax asset	$ 3,558	$ 2,078

Parent Company Only Condensed Financial Information, Statements of Income (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2021	Sep. 30, 2020
Statements of Income [Abstract]
Interest income	$ 48,675	$ 40,133
Interest expense	6,967	13,011
Loss before income taxes and equity in undistributed earnings of the bank	14,052	6,214
Income tax benefit	(3,201)	(1,240)
Net income	10,851	4,974
Parent Company [Member]
Statements of Income [Abstract]
Interest income	0	3
Interest expense	1,361	895
Loss before income taxes and equity in undistributed earnings of the bank	(1,361)	(892)
Income tax benefit	296	187
Equity in undistributed earnings of the Bank	11,916	5,679
Net income	$ 10,851	$ 4,974

Amount of income (loss) from continuing operations, including income (loss) from equity method investments, before deduction of income tax expense (benefit), and income (loss) attributable to noncontrolling interest.

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

Commitments and Contingent Liabilities [Abstract]

Commitments and Contingent Liabilities (Tables)

12 Months Ended

Sep. 30, 2021

Commitments Outstanding

The following represents commitments outstanding:

	September 30,
(in thousands)	2021		2020
Standby letters of credit	$	786	$	159
Loan commitments outstanding		81,040		17,405
Unused lines of credit		24,639		11,218
Total	$	106,465	$	28,782

Future Minimum Rental Commitments Non-Cancelable Operating Leases

The Company is obligated to make minimum annual rental payments under non-cancelable operating leases. Projected minimum rentals under the existing leases are as follows:

(in thousands)	Total
2022	$	1,886
2023		1,921
2024		1,948
2025		1,951
2026		1,621
Thereafter		4,729
Total	$	14,056

Goodwill and Other Intangible Assets (Tables)

12 Months Ended

Sep. 30, 2021

Goodwill and Other Intangible Assets [Abstract]

Goodwill and Other Intangible Assets

The following table presents activity for goodwill and other intangible assets, which consist of core deposit intangibles:

	September 30,
(in thousands)	2021			2020
Goodwill at beginning of period	$	1,901		$	1,482
Acquisition		17,457			-
Measurement period adjustment for previous acquisition		(190	)		419
Goodwill at end of period	$	19,168		$	1,901

Other intangible assets at beginning of period	$	22		$	27
Acquisition		490			-
Amortization		(32	)		(5	)
Other intangible assets at end of period	$	480		$	22

Gross Carrying Amount and Accumulated Amortization for Other Intangible Assets

The following table presents the gross carrying amount and accumulated amortization for the Company’s other intangible assets, which consists of core deposit intangibles:

	September 30,
(in thousands)	2021			2020
Gross carrying amount	$	517		$	27
Accumulated amortization		(37	)		(5	)
Net book value	$	480		$	22

Estimated Future Amortization Expense for Other Intangible Assets

The following table presents estimated future amortization expense for other intangible assets:

(in thousands)
2022	$	81
2023		72
2024		63
2025		55
2026		49
Thereafter		160
Total	$	480

Commitments and Contingent Liabilities, Commitments Outstanding (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Sep. 30, 2020
Commitments outstanding [Abstract]
Total	$ 106,465	$ 28,782
Standby Letters of Credit [Member]
Commitments outstanding [Abstract]
Total	786	159
Loan Commitments Outstanding [Member]
Commitments outstanding [Abstract]
Total	81,040	17,405
Fixed rate loan commitments amount	61,400	400
Variable rate loan commitments amount	19,700	17,000
Unused Lines of Credit [Member]
Commitments outstanding [Abstract]
Total	$ 24,639	$ 11,218

Equity Compensation Plans, Stock Options (Details) - Stock Options [Member] - USD ($)
$ / shares in Units, $ in Thousands

12 Months Ended

Sep. 30, 2021

Sep. 30, 2020

Equity Compensation Plans [Abstract]

Award vesting period

3 years

Contractual term

10 years

Number of Options [Roll Forward]

Outstanding, beginning of period (in shares)

155,506

Converted in Savoy acquisition (in shares)

71,900

Exercised (in shares)

Forfeited (in shares)

Outstanding, end of period (in shares)

227,406

^[1]

155,506

Weighted-Average Exercise Price Per Share [Roll Forward]

Outstanding, beginning of period (in dollars per share)

$ 11.35

Converted in Savoy acquisition (in dollars per share)

5.51

Exercised (in dollars per share)

Forfeited (in dollars per share)

Outstanding, end of period (in dollars per share)

$ 9.50

^[1]

$ 11.35

Aggregate Intrinsic Value [Abstract]

Aggregate intrinsic value, outstanding

$ 2,043

^[1]

$ 1,623

Weighted Average Remaining Contractual Term [Abstract]

Weighted-average remaining contractual term, outstanding

3 years 6 months 3 days

^[1]

4 years 7 months 28 days

Fair value share price (in dollars per share)

$ 17.65

[1]	All outstanding options are fully vested and exercisable

Related Party Transactions (Tables)

12 Months Ended

Sep. 30, 2021

Loans to Related Parties

Loans to related parties during 2021 were as follows:

(in thousands)
Beginning balance, October 1, 2020	$	2,577
New loans		-
Repayments		(87	)
Ending balance, September 30, 2021	$	2,490

Premises and Equipment (Details) - USD ($) $ in Thousands	12 Months Ended
Premises and Equipment (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Sep. 30, 2020
Premises and Equipment [Abstract]
Premises and equipment, gross	$ 20,321	$ 18,818
Less: Accumulated depreciation and amortization	(5,318)	(4,662)
Premises and equipment, net	15,003	14,156
Depreciation and amortization	1,400	1,300
Land [Member]
Premises and Equipment [Abstract]
Premises and equipment, gross	1,600	1,600
Building and Improvements [Member]
Premises and Equipment [Abstract]
Premises and equipment, gross	9,974	9,434
Leasehold Improvements [Member]
Premises and Equipment [Abstract]
Premises and equipment, gross	2,354	2,001
Furniture, Fixtures and Equipment [Member]
Premises and Equipment [Abstract]
Premises and equipment, gross	5,269	5,454
Construction in Progress [Member]
Premises and Equipment [Abstract]
Premises and equipment, gross	$ 1,124	$ 329

Fair Value Measurements, Carrying Amount and Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Sep. 30, 2020
Carrying Amount [Member]
Financial Assets [Abstract]
Cash and cash equivalents	$ 166,544	$ 80,209
Securities held to maturity	8,611	10,727
Securities available-for-sale	7,747	6,035
Federal Home Loan Bank stock	3,714	4,170
Loans, net	1,238,573	717,150
Accrued interest receivable	9,363	6,766
Financial Liabilities [Abstract]
Time deposits	377,836	394,753
Demand and other deposits	786,826	270,007
Borrowings	159,642	85,154
Subordinated debentures	24,513
Note payable		14,984
Accrued interest payable	1,290	374
Fair Value [Member]
Financial Assets [Abstract]
Cash and cash equivalents	166,544	80,209
Securities held to maturity	8,865	11,131
Securities available-for-sale	7,747	6,035
Loans, net	1,278,056	746,969
Accrued interest receivable	9,363	6,766
Financial Liabilities [Abstract]
Time deposits	378,333	397,842
Demand and other deposits	786,826	270,007
Borrowings	159,608	87,052
Subordinated debentures	27,092
Note payable		15,329
Accrued interest payable	1,290	374
Fair Value [Member] \| Quoted Prices in Active Markets for Identical Assets (Level 1) [Member]
Financial Assets [Abstract]
Cash and cash equivalents	166,544	80,209
Securities held to maturity	0	0
Securities available-for-sale	0	0
Loans, net	0	0
Accrued interest receivable	0	0
Financial Liabilities [Abstract]
Time deposits	0	0
Demand and other deposits	786,826	270,007
Borrowings	0	0
Subordinated debentures	0
Note payable		0
Accrued interest payable	1	1
Fair Value [Member] \| Significant Other Observable Inputs (Level 2) [Member]
Financial Assets [Abstract]
Cash and cash equivalents	0	0
Securities held to maturity	8,865	11,131
Securities available-for-sale	7,747	6,035
Loans, net	0	0
Accrued interest receivable	211	218
Financial Liabilities [Abstract]
Time deposits	378,333	397,842
Demand and other deposits	0	0
Borrowings	159,608	87,052
Subordinated debentures	27,092
Note payable		0
Accrued interest payable	713	339
Fair Value [Member] \| Significant Unobservable Inputs (Level 3) [Member]
Financial Assets [Abstract]
Cash and cash equivalents	0	0
Securities held to maturity	0	0
Securities available-for-sale	0	0
Loans, net	1,278,056	746,969
Accrued interest receivable	9,152	6,548
Financial Liabilities [Abstract]
Time deposits	0	0
Demand and other deposits	0	0
Borrowings	0	0
Subordinated debentures	0
Note payable		15,329
Accrued interest payable	$ 576	$ 34

Commitments and Contingent Liabilities

12 Months Ended

Sep. 30, 2021

Commitments and Contingent Liabilities [Abstract]

Commitments and Contingent Liabilities

Note 13. Commitments and Contingent Liabilities

Loan Commitments and Other Related Activities

Some financial instruments such as loan commitments, credit lines, letters of credit, and overdraft protection are issued to meet customer financing needs. These are agreements to provide credit or to support the credit of others, as long as conditions established in the contract are met, and usually have expiration dates. Commitments may expire without being used. Off-balance-sheet risk of credit loss exists up to the face amount of these instruments, although material losses are not anticipated. The same credit policies are used to make such commitments as are used for loans, including obtaining collateral at exercise of the commitment.

The following represents commitments outstanding:

	September 30,
(in thousands)	2021		2020
Standby letters of credit	$	786	$	159
Loan commitments outstanding		81,040		17,405
Unused lines of credit		24,639		11,218
Total	$	106,465	$	28,782

Of the $81.0 million of loan commitments outstanding at September 30, 2021, $61.4 million are fixed rate commitments and $19.7 million are variable rate commitments. Of the $17.4 million of loan commitments outstanding at September 30, 2020, $0.4 million are fixed rate commitments and $17 million are variable rate commitments. All unused lines of credit at September 30, 2021 and 2020 are variable rate commitments.

Leases

The Company is obligated to make minimum annual rental payments under non-cancelable operating leases. Projected minimum rentals under the existing leases are as follows:

(in thousands)	Total
2022	$	1,886
2023		1,921
2024		1,948
2025		1,951
2026		1,621
Thereafter		4,729
Total	$	14,056

The leases contain renewal options and rent escalation clauses. In addition, the leases provide for additional payments based upon real estate taxes, interest and other charges. Rent expense under operating leases for the years ended September 30, 2021 and 2020 approximated $1.7 million and $1.6 million, respectively.

Business Combinations, Consideration Paid (Details) - USD ($) $ in Thousands			3 Months Ended	12 Months Ended
	May 26, 2021	Apr. 30, 2021	Sep. 30, 2021	Sep. 30, 2021	Sep. 30, 2020
Consideration Paid [Abstract]
Cash payments to common shareholders				$ 32,991	$ 0
Business Combination [Abstract]
Acquisition cost				$ 4,430	$ 450
Core Deposits [Member]
Business Combination [Abstract]
Estimated useful life				10 years
Savoy Bank [Member]
Consideration Paid [Abstract]
Common stock issued (1,357,567 shares issued)	$ 32,521
Cash payments to common shareholders	32,991
Total consideration paid	$ 65,512
Business Combination [Abstract]
Goodwill deductible for income tax purposes			$ 0	$ 0
Increase in goodwill			$ 1,100
Acquisition cost				$ 4,400
Savoy Bank [Member] \| Core Deposits [Member]
Business Combination [Abstract]
Estimated useful life				10 years
Savoy Bank [Member] \| Maximum [Member]
Business Combination [Abstract]
Fair value refinement period				1 year
Savoy Bank [Member] \| Common Stock [Member]
Consideration Paid [Abstract]
Total consideration paid		$ 65,500
Business Combination [Abstract]
Common stock issued as part of consideration (in shares)	1,357,567

Accumulated Other Comprehensive Income, Significant Amounts Reclassified Out of Accumulated Other Comprehensive Income (Details) - USD ($)
$ in Thousands

12 Months Ended

Sep. 30, 2021

Sep. 30, 2020

Significant amounts reclassified out of accumulated other comprehensive income [Abstract]

Gain on sale of investment securities available-for-sale, net

^[1]

$ 240

$ 0

Tax effect

(3,201)

(1,240)

Accumulated Other Comprehensive Income [Member]

10,851

4,974

Significant amounts reclassified out of accumulated other comprehensive income [Abstract]

Amount Reclassified from Accumulated Other Comprehensive Income [Member] | Unrealized Gains and Losses on Available-for-Sale Debt Securities

$ 0

Significant amounts reclassified out of accumulated other comprehensive income [Abstract]

Gain on sale of investment securities available-for-sale, net

240

Tax effect

(49)

$ 191

[1]	Not included within the scope of ASC 606

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.