0001558370-22-013404 | 10-Q | XBRL Viewer

Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Jun. 30, 2022	Jul. 31, 2022
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2022
Current Fiscal Year End Date	--09-30
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q3
Document Transition Report	false
Entity File Number	001-41384
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
Title of 12(b) Security	Common stock
Trading Symbol	HNVR
Security Exchange Name	NASDAQ
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
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		7,293,430

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION - USD ($) $ in Thousands	Jun. 30, 2022	Sep. 30, 2021
ASSETS
Cash and non-interest-bearing deposits due from banks	$ 11,918	$ 8,302
Interest-bearing deposits due from banks	121,651	142,950
Federal funds sold	405	15,292
Total cash and cash equivalents	133,974	166,544
Securities:
Held to maturity (fair value of $4,309 and $8,865, respectively)	4,509	8,611
Available for sale, at fair value	6,740	7,747
Total securities	11,249	16,358
Loans held for investment	1,415,777	1,247,125
Allowance for loan losses	(10,886)	(8,552)
Loans held for investment, net	1,404,891	1,238,573
Premises and equipment, net	14,691	15,003
Accrued interest receivable	7,643	9,363
Prepaid pension	3,784	4,233
Stock in Federal Home Loan Bank ("FHLB"), at cost	3,858	3,714
Goodwill	19,168	19,168
Other intangible assets	418	480
Loan servicing rights	4,120	3,690
Deferred income taxes	2,473	3,558
Other assets	3,488	3,957
TOTAL ASSETS	1,609,757	1,484,641
Deposits:
Non-interest-bearing demand	220,357	191,537
Savings, NOW and money market	830,920	595,289
Time	298,272	377,836
Total deposits	1,349,549	1,164,662
Borrowings	56,963	159,642
Subordinated debentures	24,554	24,513
Accrued interest payable	611	1,290
Other liabilities	10,689	12,005
TOTAL LIABILITIES	1,442,366	1,362,112
STOCKHOLDERS' EQUITY
Common stock (par value $0.01; 17,000,000 shares authorized; issued and outstanding 7,296,624 and 5,563,426, respectively)	73	56
Surplus	126,215	97,246
Retained earnings	41,379	24,971
Accumulated other comprehensive (loss) income, net of tax	(276)	256
TOTAL STOCKHOLDERS' EQUITY	167,391	122,529
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$ 1,609,757	$ 1,484,641

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2022	Sep. 30, 2021
Securities:
Held to maturity, fair value	$ 4,309	$ 8,865
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)	7,296,624	5,563,426
Common stock, shares outstanding (in shares)	7,296,624	5,563,426

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
INTEREST INCOME
Loans	$ 15,842	$ 11,798	$ 47,972	$ 30,189
Taxable securities	98	168	358	523
Other interest income	319	72	486	203
Total interest income	16,259	12,038	48,816	30,915
INTEREST EXPENSE
Savings, NOW and money market deposits	579	269	1,290	543
Time deposits	427	760	1,319	3,129
Borrowings	433	561	1,374	1,666
Total interest expense	1,439	1,590	3,983	5,338
Net interest income	14,820	10,448	44,833	25,577
Provision for loan losses	1,000		2,400	300
Net interest income after provision for loan losses	13,820	10,448	42,433	25,277
NON-INTEREST INCOME
Loan servicing and fee income	779	401	2,203	623
Service charges on deposit accounts	60	34	169	66
Gain on sale of loans held-for-sale	849	212	3,916	688
Gain on sale of investments available for sale			105	240
Other income	140	3	483	11
Total non-interest income	1,828	650	6,876	1,628
NON-INTEREST EXPENSE
Salaries and employee benefits	4,843	3,923	15,400	10,299
Occupancy and equipment	1,394	1,300	4,177	3,680
Data processing	374	419	1,133	934
Advertising and promotion	112	18	298	85
Acquisition costs	250	3,937	250	4,233
Professional fees	579	369	1,718	1,089
Other expenses	1,178	766	3,376	1,727
Total non-interest expense	8,730	10,732	26,352	22,047
Income before income tax expense	6,918	366	22,957	4,858
Income tax expense	1,585	145	5,227	1,063
NET INCOME	$ 5,333	$ 221	$ 17,730	$ 3,795
EARNINGS PER COMMON SHARE - BASIC (in dollars per share)	$ 0.81	$ 0.05	$ 2.97	$ 0.87
EARNINGS PER COMMON SHARE - DILUTED (in dollars per share)	$ 0.80	$ 0.05	$ 2.92	$ 0.85

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)
Net income	$ 5,333	$ 221	$ 17,730	$ 3,795
Other comprehensive (loss) income, net of tax:
Change in unrealized (loss) gain on securities available for sale arising during the period, net of tax of ($65), $11, ($224) and $79, respectively	(241)	27	(451)	288
Reclassification adjustment for gains realized in net income, net of tax of $0, $0, ($24) and ($49) respectively			(81)	(191)
Total other comprehensive (loss) income, net of tax	(241)	27	(532)	97
Total comprehensive income, net of tax	$ 5,092	$ 248	$ 17,198	$ 3,892

- Definition

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

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 220
-Section S99
-Paragraph 1
-Subparagraph (SX 210.9-04(22))
-URI http://asc.fasb.org/extlink&oid=120399700&loc=SL114874048-224260

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (f)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 4
-URI http://asc.fasb.org/extlink&oid=124431687&loc=d3e22595-107794

Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 944
-SubTopic 220
-Section S99
-Paragraph 1
-Subparagraph (SX 210.7-04(18))
-URI http://asc.fasb.org/extlink&oid=120400993&loc=SL114874131-224263

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 40
-Section 65
-Paragraph 1
-Subparagraph (f)
-URI http://asc.fasb.org/extlink&oid=123482062&loc=SL123482106-238011

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
-SubTopic 10
-Section 50
-Paragraph 6
-URI http://asc.fasb.org/extlink&oid=124431353&loc=SL124452729-227067

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(5))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442552-122756

Reference 8: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SX 210.5-03(20))
-URI http://asc.fasb.org/extlink&oid=123367319&loc=SL114868664-224227

Reference 9: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 230
-SubTopic 10
-Section 45
-Paragraph 28
-URI http://asc.fasb.org/extlink&oid=123570139&loc=d3e3602-108585

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 1
-Subparagraph (b)(2)
-URI http://asc.fasb.org/extlink&oid=124431687&loc=d3e22499-107794

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(iv))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442526-122756

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(iii)(A))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442526-122756

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(i))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442552-122756

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(i))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442526-122756

Reference 15: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 9
-URI http://asc.fasb.org/extlink&oid=124431687&loc=d3e22663-107794

Reference 16: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iv))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442552-122756

Reference 17: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(ii))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442526-122756

Reference 18: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 825
-SubTopic 10
-Section 50
-Paragraph 28
-Subparagraph (f)
-URI http://asc.fasb.org/extlink&oid=123596393&loc=d3e14064-108612

Reference 19: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=124431687&loc=d3e22583-107794

Reference 20: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(g)(1)(ii))
-URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

Reference 21: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 260
-SubTopic 10
-Section 45
-Paragraph 60B
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=125511455&loc=SL5780133-109256

Reference 22: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 323
-SubTopic 10
-Section 50
-Paragraph 3
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=114001798&loc=d3e33918-111571

Reference 23: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=124431687&loc=d3e22658-107794

Reference 24: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
-SubTopic 10
-Section 45
-Paragraph 1A
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=124509347&loc=SL7669619-108580

Reference 25: http://www.xbrl.org/2003/role/exampleRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 31
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8924-108599

Reference 26: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 11
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=124431687&loc=d3e22694-107794

Reference 27: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 11
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=124431687&loc=d3e22694-107794

Reference 28: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 205
-SubTopic 20
-Section 50
-Paragraph 7
-URI http://asc.fasb.org/extlink&oid=109222650&loc=SL51721683-107760

Reference 29: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
-SubTopic 10
-Section 45
-Paragraph 1B
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=124509347&loc=SL7669625-108580

Reference 30: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8736-108599

Reference 31: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(5))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442526-122756

Reference 32: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iii)(B))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442552-122756

Reference 33: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iii)(A))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442552-122756

Reference 34: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 30
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8906-108599

Reference 35: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599

+ Details

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) (Parenthetical) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Other comprehensive (loss) income, net of tax:
Change in unrealized (loss) gain on investment securities available for sale, tax	$ (65)	$ 11	$ (224)	$ 79
Reclassification adjustment for gains realized in net income, tax	$ 0	$ 0	$ (24)	$ (49)

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (UNAUDITED) - USD ($) $ in Thousands	Common Stock	Surplus	Retained Earnings	Accumulated Other Comprehensive (Loss) Income, Net	Total
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			1,519		1,519
Other comprehensive income (loss), net of tax				167	167
Stock-based compensation		229			229
Stock-based compensation (in shares)	7,390
Issuance of common stock		66			66
Issuance of common stock (in shares)	3,000
Balance at Dec. 31, 2020	$ 42	64,020	15,639	323	80,024
Balance (in shares) at Dec. 31, 2020	4,185,534
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					3,795
Other comprehensive income (loss), net of tax					97
Balance at Jun. 30, 2021	$ 56	97,014	17,915	253	115,238
Balance (in shares) at Jun. 30, 2021	5,552,457
Balance at Dec. 31, 2020	$ 42	64,020	15,639	323	80,024
Balance (in shares) at Dec. 31, 2020	4,185,534
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income			2,055		2,055
Other comprehensive income (loss), net of tax				(97)	(97)
Stock-based compensation		216			216
Stock-based compensation (in shares)	7,229
Issuance of common stock		47			47
Issuance of common stock (in shares)	2,127
Balance at Mar. 31, 2021	$ 42	64,283	17,694	226	82,245
Balance (in shares) at Mar. 31, 2021	4,194,890
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income			221		221
Other comprehensive income (loss), net of tax				27	27
Savoy acquisition rollover options value		1,269			1,269
Stock-based compensation		224			224
Issuance of common stock	$ 14	31,238			31,252
Issuance of common stock (in shares)	1,357,567
Balance at Jun. 30, 2021	$ 56	97,014	17,915	253	115,238
Balance (in shares) at Jun. 30, 2021	5,552,457
Balance at Sep. 30, 2021	$ 56	97,246	24,971	256	122,529
Balance (in shares) at Sep. 30, 2021	5,563,426
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income			6,537		6,537
Other comprehensive income (loss), net of tax				54	54
Stock-based compensation		217			217
Stock awards granted, net of forfeitures (in shares)	(3,011)
Issuance of common stock in lieu of directors' fees		42			42
Issuance of common stock in lieu of directors' fees (in shares)	2,384
Balance at Dec. 31, 2021	$ 56	97,505	31,508	310	129,379
Balance (in shares) at Dec. 31, 2021	5,562,799
Balance at Sep. 30, 2021	$ 56	97,246	24,971	256	122,529
Balance (in shares) at Sep. 30, 2021	5,563,426
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income					17,730
Other comprehensive income (loss), net of tax					(532)
Balance at Jun. 30, 2022	$ 73	126,215	41,379	(276)	167,391
Balance (in shares) at Jun. 30, 2022	7,296,624
Balance at Dec. 31, 2021	$ 56	97,505	31,508	310	129,379
Balance (in shares) at Dec. 31, 2021	5,562,799
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income			5,860		5,860
Other comprehensive income (loss), net of tax				(345)	(345)
Cash dividends declared			(588)		(588)
Stock-based compensation		462			462
Stock awards granted, net of forfeitures	$ 2	(2)
Stock awards granted, net of forfeitures (in shares)	266,770
Balance at Mar. 31, 2022	$ 58	97,965	36,780	(35)	134,768
Balance (in shares) at Mar. 31, 2022	5,829,569
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income			5,333		5,333
Other comprehensive income (loss), net of tax				(241)	(241)
Cash dividends declared			(734)		(734)
Stock-based compensation		564			564
Shares received related to tax withholding		(28)			(28)
Shares received related to tax withholding (in shares)	(677)
Stock awards granted, net of forfeitures (in shares)	1,482
Issuance of common stock	$ 15	27,714			27,729
Issuance of common stock (in shares)	1,466,250
Balance at Jun. 30, 2022	$ 73	$ 126,215	$ 41,379	$ (276)	$ 167,391
Balance (in shares) at Jun. 30, 2022	7,296,624

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (UNAUDITED) (Parenthetical) - $ / shares	3 Months Ended	9 Months Ended
	Mar. 31, 2022	Jun. 30, 2022
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (UNAUDITED)
Cash dividends declared (in dollars per share)	$ 0.10	$ 0.10

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Thousands	9 Months Ended
	Jun. 30, 2022	Jun. 30, 2021
Cash flows from operating activities:
Net income	$ 17,730	$ 3,795
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for loan losses	2,400	300
Depreciation and amortization	1,243	884
Net gain on sale of securities available for sale	(105)	(240)
Stock-based compensation	1,243	669
Net gain on sale of loans held-for-sale	(3,916)	(688)
Net accretion of premiums, discounts and loan fees and costs	(2,933)	(848)
Amortization of intangible assets	62	10
Amortization of debt issuance costs	41	59
Loan servicing rights valuation adjustments	354	116
Deferred tax expense	1,251	793
Decrease in accrued interest receivable	1,720	1,017
Decrease in other assets	113	647
Decrease in accrued interest payable	(679)	(268)
(Decrease) increase in other liabilities	(1,316)	737
Net cash provided by operating activities	17,208	6,983
Cash flows from investing activities:
Purchases of securities available for sale	(2,000)	(4,683)
Purchases of restricted securities	(1,548)	(346)
Proceeds from sales of securities available for sale	2,105	3,240
Principal repayments of securities held to maturity	4,097	1,727
Principal repayments of securities available for sale	321	294
Redemptions of restricted securities	1,404	1,192
Proceeds from sales of loans	64,851	32,045
Net increase in loans	(227,707)	(21,180)
Purchases of premises and equipment	(931)	(1,299)
Cash acquired in business combination	0	59,155
Cash consideration paid in acquisition	0	(32,991)
Net cash (used in) provided by investing activities	(159,408)	37,154
Cash flows from financing activities:
Net increase in deposits	185,753	152,082
Advances of term FHLB borrowings	20,000	0
Repayments of FHLB advances	(24,000)	(25,044)
Repayments of Federal Reserve Bank borrowings	(98,544)	(90,018)
Proceeds from issuance of subordinated debentures, net of issuance costs	0	24,455
Repayment of note payable	0	(15,000)
Payments related to tax withholding for equity awards	(28)	0
Cash dividends paid	(1,322)	0
Net proceeds from issuance of common stock	27,771	113
Net cash provided by financing activities	109,630	46,588
(Decrease) increase in cash and cash equivalents	(32,570)	90,725
Cash and cash equivalents, beginning of period	166,544	80,209
Cash and cash equivalents, end of period	133,974	170,934
Supplemental cash flow information:
Interest paid	4,662	5,606
Income taxes paid	5,316	1,245
Supplemental non-cash disclosure:
Transfers from portfolio loans to loans held-for-sale	60,935	36,084
Business combination:
Fair value of tangible assets acquired	0	653,380
Fair value of liabilities assumed	0	605,815
Common stock issued in business combination	$ 0	$ 31,252

BASIS OF PRESENTATION, RISKS AND UNCERTAINTIES, ACCOUNTING POLICIES AND RECENT ACCOUNTING DEVELOPMENTS

9 Months Ended

Jun. 30, 2022

BASIS OF PRESENTATION, RISKS AND UNCERTAINTIES, ACCOUNTING POLICIES AND RECENT ACCOUNTING DEVELOPMENTS

BASIS OF PRESENTATION, RISKS AND UNCERTAINTIES, ACCOUNTING POLICIES AND RECENT ACCOUNTING DEVELOPMENTS

1. BASIS OF PRESENTATION, RISKS AND UNCERTAINTIES, ACCOUNTING POLICIES AND RECENT ACCOUNTING DEVELOPMENTS

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 (“FDIC”). The Company is subject to regulation and examination by the Board of Governors of the Federal Reserve System (the “FRB”).

Basis of Presentation

In the opinion of the Company’s management, the preceding unaudited interim consolidated financial statements contain all adjustments, consisting of normal accruals, necessary for a fair presentation of the Company’s consolidated statement of financial condition as of June 30, 2022, its consolidated statements of income for the three and nine months ended June 30, 2022 and 2021, its consolidated statements of comprehensive income for the three and nine months ended June 30, 2022 and 2021, its consolidated statements of changes in stockholders’ equity for the three and nine months ended June 30, 2022 and 2021 and its consolidated statements of cash flows for the nine months ended June 30, 2022 and 2021. Certain prior period amounts have been reclassified to conform to the current period presentation.

In addition, the preceding unaudited interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X, as well as in accordance with predominant practices within the banking industry. They do not include all the information and footnotes required by U.S. GAAP for complete financial statements. The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and the accompanying notes. Actual results could differ from those estimates. The results of operations for the three and nine months ended June 30, 2022 are not necessarily indicative of the results of operations to be expected for the remainder of the year. The unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2021.

All material intercompany accounts and transactions have been eliminated in consolidation. Unless the context otherwise requires, references herein to the Company include the Company and the Bank on a consolidated basis.

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 Coronavirus Aid, Relief, and Economic Security Act (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 ongoing 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, the spread of new variants of the virus, 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.

Accounting Policies

Allowance for Loan Losses – The Company considers the determination of the allowance for loan losses its most critical accounting policy, practice, and use of estimates. The Company 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. The allowance for loan losses is increased by a 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. The adequacy of the allowance to cover any inherent loan losses in the portfolio is evaluated on a quarterly basis.

Loans and Loan Interest Income Recognition - Loans that the Company 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, multi-family, commercial real estate, commercial and industrial, construction and land development, 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.

Loans that are acquired are initially recorded at fair value with no carryover of the related allowance for loan losses. After acquisition, losses are recognized through the allowance for loan losses. Determining the fair value of the loans involves estimating the amount and timing of expected principal and interest cash flows to be collected on the loans and discounting those cash flows at a market interest rate. At June 30, 2022 and September 30, 2021, the Company had loans totaling $1.2 million and $10.2 million, respectively, which at the time of acquisition, showed evidence of credit deterioration since origination.

Loans Held for Sale - Mortgage loans originated and intended for sale in the secondary market are carried at the lower of aggregate cost or estimated fair value as determined by outstanding commitments from investors. Periodically, the Company originates various residential mortgage loans for sale to investors generally on a servicing released basis. The sale of such loans is generally arranged through a master commitment on a best-efforts basis. Net unrealized losses, if any, are recorded as a valuation allowance and charged to earnings. Premiums, discounts, origination fees and costs on loans held for sale are deferred and recognized as a component of the gain or loss on sale. Gains and losses on sales of loans held for sale are included in other income, recognized on settlement date and are determined to be the difference between the sale proceeds and the carrying value of the loans. These transactions are accounted for as sales based on satisfaction of the criteria for such accounting which provides that, as transferor, the Company has surrendered control of the loans.

For liquidity purposes generally, there are instances when loans originated with the intent to hold in the portfolio are subsequently transferred to loans held for sale. At transfer, they are carried at the lower of cost or fair value.

Recent Accounting Developments

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 (“CECL”), 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 standard 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.

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.

BUSINESS COMBINATIONS

9 Months Ended

Jun. 30, 2022

BUSINESS COMBINATIONS

BUSINESS COMBINATIONS

2. BUSINESS COMBINATIONS

On May 26, 2021, the Company completed its previously announced acquisition of Savoy Bank (“Savoy”) pursuant to an Agreement and Plan of Merger (the “Merger Agreement”), dated as of August 27, 2020, as amended, between the Company, the Bank and Savoy. Pursuant to the Merger Agreement, Savoy was merged with and into the Bank, with the Bank surviving, in a two-step transaction (collectively, the “Merger”).

The purchase price in the transaction was based upon the tangible book values of each of the Company and Savoy as of April 30, 2021 and calculated in accordance with the terms of the Merger Agreement. At the effective time of the Merger, each share of Savoy common stock, $1.00 par value was converted into the right to receive (i) $3.246 in cash and (ii) 0.141 shares of the Company’s common stock. The final aggregate purchase price was $65.5 million, or $6.49 per Savoy share.

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


	As Recorded		Fair Value			As Recorded
(in thousands)	by Savoy		Adjustments			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)	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.

(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)	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.

(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.

A summary of total consideration paid is as follows:


(in thousands, except share data)
Common stock issued (1,357,567 shares issued)	$	31,252
Rollover options		1,269
Cash payments to common shareholders		32,991
Total consideration paid	$	65,512

With the Savoy acquisition, the Company significantly expanded its commercial banking and Small Business Administration (“SBA”) lending capabilities. None of the goodwill associated with this acquisition is deductible for income tax purposes. All goodwill related to this acquisition was allocated to the Company’s only reporting unit, which is the Company as a whole.

The Company has determined the above noted acquisition constitutes a business combination as defined by ASC Topic 805, which establishes principles and requirements for how the acquirer of a business recognizes and measures in its financial statements the identifiable assets acquired and the liabilities assumed. The Company has recorded the assets purchased and liabilities assumed at fair value in accordance with ASC Topic 805.

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

EARNINGS PER COMMON SHARE

9 Months Ended

Jun. 30, 2022

EARNINGS PER COMMON SHARE

EARNINGS PER COMMON SHARE

3. EARNINGS PER COMMON SHARE

Basic earnings per common share is computed based on the weighted-average number of shares outstanding. Diluted earnings per common share includes the dilutive effect of additional potential common shares issuable under stock options. For periods in which a loss is reported, the impact of stock options is not considered as the result would be antidilutive.

The computation of earnings per common share for the three and nine months ended June 30, 2022 and 2021 follows. There were no stock options that were antidilutive for the three and nine months ended June 30, 2022 and 2021.


	Three Months Ended June 30,				Nine Months Ended June 30,
(in thousands, except share and per share data)	2022		2021		2022		2021
Basic earnings per common share
Net income	$	5,333	$	221	$	17,730	$	3,795
Weighted average common shares outstanding		6,596,505		4,731,949		5,970,288		4,368,809
Basic earnings per common share	$	0.81	$	0.05	$	2.97	$	0.87
Diluted earnings per common share
Net income	$	5,333	$	221	$	17,730	$	3,795
Weighted average common shares outstanding for basic earnings per common share		6,596,505		4,731,949		5,970,288		4,368,809
Add: dilutive effects of assumed exercises of stock options		99,062		84,311		99,206		84,129
Average shares and dilutive potential common shares		6,695,567		4,816,260		6,069,494		4,452,938
Diluted earnings per common share	$	0.80	$	0.05	$	2.92	$	0.85

SECURITIES

9 Months Ended

Jun. 30, 2022

SECURITIES [Abstract]

SECURITIES

4. SECURITIES

At the time of purchase of a security, the Company designates the security as either available for sale or held to maturity, depending upon investment objectives, liquidity needs and intent.

The following table summarizes the amortized cost and fair value of securities available for sale and securities held to maturity at June 30, 2022 and September 30, 2021 and the corresponding amounts of gross unrealized gains and losses recognized in accumulated other comprehensive income:


	June 30, 2022
	Amortized		Gross Unrealized		Gross Unrealized
(in thousands)	Cost		Gains		Losses		Fair Value
Available for sale:
U.S. GSE residential mortgage-backed securities	$	390	$	—	$	(71)	$	319
Corporate bonds		6,700		—		(279)		6,421
Total available for sale securities	$	7,090	$	—	$	(350)	$	6,740

Held to maturity:
U.S. GSE residential mortgage-backed securities	$	1,858	$	—	$	(117)	$	1,741
U.S. GSE commercial mortgage-backed securities		2,651		—		(83)		2,568
Total held to maturity securities		4,509		—		(200)		4,309
Total investment securities	$	11,599	$	—	$	(550)	$	11,049


	September 30, 2021
			Gross		Gross
	Amortized		Unrealized		Unrealized
(in thousands)	Cost		Gains		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 securities	$	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 securities		8,611		258		(4)		8,865
Total investment securities	$	16,033	$	584	$	(5)	$	16,612

All of the Company’s securities with gross unrealized losses at June 30, 2022 and September 30, 2021 had been in a continuous loss position for less than twelve months, totaling $550 thousand and $5 thousand, respectively. At June 30 2022 and September 30, 2021, investment securities carried at $1.8 million and $5.1 million, respectively, were pledged to secure public deposits and for other purposes required or permitted by law.

The amortized cost and fair value of the Company’s securities portfolio at June 30, 2022 are presented by contractual maturity in the table 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.


	June 30, 2022
	Amortized		Fair
(in thousands)	Cost		Value
Securities available for sale:
Five to ten years	$	6,700	$	6,421
U.S. GSE residential mortgage-backed securities		390		319
Total securities available for sale		7,090		6,740
Securities held to maturity:
One to five years		—		—
Five to ten years		—		—
U.S. GSE residential mortgage-backed securities		1,858		1,741
U.S. GSE commercial mortgage-backed securities		2,651		2,568
Total securities held to maturity		4,509		4,309
Total investment securities	$	11,599	$	11,049

There were $2.1 million of proceeds on sales of securities available for sale with gross gains of $105 thousand for the nine months ended June 30, 2022. For the nine months ended June 30, 2021, proceeds from sales of securities available for sale totaled $3.2 million with gross gains of $240 thousand. There were no sales of securities for the three months ended June 30, 2022 and 2021.

LOANS

9 Months Ended

Jun. 30, 2022

LOANS

LOANS

5. LOANS

The following table sets forth the classification of the Company’s loans by loan portfolio segment for the periods presented.


	June 30, 2022		September 30, 2021
(in thousands)
Residential real estate	$	431,409	$	444,011
Multi-family		478,756		266,294
Commercial real estate		429,953		348,641
Commercial and industrial		56,544		172,274
Construction and land development		17,214		15,374
Consumer		12		11
Gross loans		1,413,888		1,246,605
Net deferred costs (fees)		1,889		520
Total loans		1,415,777		1,247,125
Allowance for loan losses		(10,886)		(8,552)
Total loans, net	$	1,404,891	$	1,238,573

The Company was a participant in the Paycheck Protection Program (“PPP”), administered by the Small Business Administration under the CARES Act, to provide guaranteed loans to qualifying businesses and organizations. These loans carry a fixed rate of 1.00% and a term of two years (loans made before June 5, 2020, subject to extension to five years with the consent of the lender) or five years (loans made on or after June 5, 2020), if not forgiven, in whole or in part. As of June 30, 2022, borrowers had received forgiveness or had made payments on $345.7 million in PPP loans. The Company’s PPP loans outstanding, included in commercial and industrial loans in the table above, totaled $20.4 million and $140.4 million at June 30, 2022 and September 30, 2021, respectively.

At June 30, 2022 and September 30, 2021, the Company was servicing approximately $233.2 million of loans for others. The Company had no loans held for sale at June 30, 2022 and September 30, 2021.

Purchased Credit Impaired Loans

The Company has purchased loans, for which there was, at acquisition, evidence of deterioration of credit quality since origination and it was probable, at acquisition, that all contractually required payments would not be collected. The carrying amount for those loans is as follows:


	June 30,		September 30,
	2022		2021
(in thousands)
Commercial real estate	$	595	$	8,324
Commercial and industrial		642		1,917
Total recorded investment	$	1,237	$	10,241

The Company has not recorded an allowance for loan losses related to these loans at June 30, 2022 and September 30, 2021.

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


	Three Months Ended		Nine Months Ended
(in thousands)	June 30, 2022		June 30, 2022
Balance at beginning of period	$	88	$	346
Accretable differences acquired		—		—
Accretion		(16)		(1,799)
Adjustments to accretable difference due to changes in expected cash flows		—		(381)
Other changes, net		—		1,906
Ending balance	$	72	$	72

For the three months ended June 30, 2022 and 2021, the Company sold loans totaling approximately $9.5 million and $13.5 million, respectively, recognizing net gains of $849 thousand and $212 thousand, respectively. For the nine months ended June 30, 2022 and 2021, the Company sold loans totaling approximately $60.9 million and $31.3 million, respectively, recognizing net gains of $3.9 million and $688 thousand, respectively.

The following summarizes the activity in the allowance for loan losses by portfolio segment for the periods indicated:


	Three Months Ended June 30, 2022
							Commercial		Construction
	Residential		Multi-		Commercial		and		and Land
	Real Estate		Family		Real Estate		Industrial		Development		Consumer
	Loans		Loans		Loans		Loans		Loans		Loans		Total
(in thousands)
Allowance for loan losses:
Beginning balance	$	3,400	$	2,627	$	3,327	$	532	$	—	$	—	$	9,886
Charge-offs		—		—		—		—		—		—		—
Recoveries		—		—		—		—		—		—		—
Provision (credit) for loan losses		(168)		503		479		103		82		1		1,000
Ending Balance	$	3,232	$	3,130	$	3,806	$	635	$	82	$	1	$	10,886


	Three Months Ended June 30, 2021
							Commercial		Construction
	Residential		Multi-		Commercial		and		and Land
	Real Estate		Family		Real Estate		Industrial		Development		Consumer
	Loans		Loans		Loans		Loans		Loans		Loans		Total
(in thousands)
Allowance for loan losses:
Beginning balance	$	4,851	$	1,955	$	1,310	$	62	$	—	$	1	$	8,179
Charge-offs		(267)		(32)		(29)		—		—		—		(328)
Recovories		—		—		—		1		—		—		1
Provision (credit) for loan losses		(209)		(23)		228		4		—		—		—
Ending balance	$	4,375	$	1,900	$	1,509	$	67	$	—	$	1	$	7,852


	Nine Months Ended June 30, 2022
							Commercial		Construction
	Residential		Multi-		Commercial		and		and Land
	Real Estate		Family		Real Estate		Industrial		Development		Consumer
	Loans		Loans		Loans		Loans		Loans		Loans		Total
(in thousands)
Allowance for loan losses:
Beginning Balance	$	4,155	$	2,433	$	1,884	$	79	$	—	$	1	$	8,552
Charge-offs		—		(66)		—		—		—		—		(66)
Recoveries		—		—		—		—		—		—		—
Provision (credit) for loan losses		(923)		763		1,922		556		82		—		2,400
Ending Balance	$	3,232	$	3,130	$	3,806	$	635	$	82	$	1	$	10,886


	Nine Months Ended June 30, 2021
							Commercial		Construction
	Residential		Multi-		Commercial		and		and Land
	Real Estate		Family		Real Estate		Industrial		Development		Consumer
	Loans		Loans		Loans		Loans		Loans		Loans		Total
(in thousands)
Allowance for loan losses:
Beginning Balance	$	5,103	$	1,506	$	1,221	$	38	$	—	$	1	$	7,869
Charge-offs		(267)		(32)		(29)		—		—		—		(328)
Recoveries		—		—		—		11		—		—		11
Provision (credit) for loan losses		(461)		426		317		18		—		—		300
Ending Balance	$	4,375	$	1,900	$	1,509	$	67	$	—	$	1	$	7,852

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. The recorded investment in loans excludes accrued interest receivable due to immateriality.


	June 30, 2022
							Commercial		Construction
	Residential		Multi-		Commercial		and		and Land
(in thousands)	Real Estate		Family		Real Estate		Industrial		Development		Consumer		Total
Allowance for loan losses:
Individually evaluated for impairment	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Collectively evaluated for impairment		3,232		3,130		3,806		635		82		1		10,886
Purchased-credit impaired		—		—		—		—		—		—		—
Total allowance for loan losses	$	3,232	$	3,130	$	3,806	$	635	$	82	$	1	$	10,886
Loans:
Individually evaluated for impairment	$	5,427	$	2,343	$	5,844	$	205	$	—	$	—	$	13,819
Collectively evaluated for impairment		426,421		477,023		423,925		56,085		17,254		13		1,400,721
Purchased-credit impaired		—		—		595		642		—		—		1,237
Total loans held for investment	$	431,848	$	479,366	$	430,364	$	56,932	$	17,254	$	13	$	1,415,777


	September 30, 2021
							Commercial		Construction
	Residential		Multi-		Commercial		and			and Land
(in thousands)	Real Estate		Family		Real Estate		Industrial		Development		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

No allowance was recorded on purchased-credit impaired loans.

The following presents information related to the Company’s impaired loans by portfolio segment for the periods shown.


	June 30, 2022						September 30, 2021
	Unpaid						Unpaid
	Principal		Recorded		Allowance		Principal		Recorded		Allowance
(in thousands)	Balance		Investment		Allocated		Balance		Investment		Allocated
With no related allowance recorded:
Residential real estate	$	5,358	$	5,427	$	—	$	7,382	$	7,198	$	—
Multi-family		2,264		2,343		—		382		458		—
Commercial real estate		5,822		5,844		—		522		517		—
Commercial and industrial		220		205		—		535		500		—
Total	$	13,664	$	13,819	$	—	$	8,821	$	8,673	$	—


	Three Months Ended June 30,								Nine Months Ended June 30,
	2022				2021				2022				2021
	Average		Interest		Average		Interest		Average		Interest		Average		Interest
	Recorded		Income		Recorded		Income		Recorded		Income		Recorded		Income
(in thousands)	Investment		Recognized⁽¹⁾		Investment		Recognized⁽¹⁾		Investment		Recognized⁽¹⁾		Investment		Recognized⁽¹⁾
Residential real estate	$	5,034	$	17	$	5,937	$	35	$	4,400	$	50	$	4,890	$	76
Multi-family		1,058		—		171		3		641		—		85		7
Commercial real estate		5,851		—		193		1		2,883		—		81		2
Commercial and industrial		207		—		181		—		200		—		60		—
Total	$	12,150	$	17	$	6,482	$	39	$	8,124	$	50	$	5,116	$	85

(1)	Accrual basis interest income recognized approximates cash basis income.

At June 30, 2022 and September 30, 2021, past due and non-accrual loans disaggregated by portfolio segment were as follows:


(in thousands)	Past Due and Non-Accrual
					Greater than
	30 - 59 days		60 - 89 days		89 days past					Total past		Purchased-
	past due and		past due and		due and					due and non-		credit
June 30, 2022	accruing		accruing		accruing		Non-accrual			accrual		impaired		Current		Total
Residential real estate	$	1,928	$	—	$	—	$	4,099	(1)	$	6,027	$	—	$	425,821	$	431,848
Multi-family		—		1,230		—		2,342	(2)		3,572		—		475,794		479,366
Commercial real estate		—		—		—		5,844	(3)		5,844		595		423,925		430,364
Commercial and industrial		—		978		—		206	(4)		1,184		642		55,106		56,932
Construction and land development		—		—		—		—			—		—		17,254		17,254
Consumer		—		—		—		—			—		—		13		13
Total	$	1,928	$	2,208	$	—	$	12,491		$	16,627	$	1,237	$	1,397,913	$	1,415,777

(1)	Of the residential real estate non-accrual loans, $2,184 were current and $1,915 were greater than 89 days past due.

(2)	Multi-family non-accrual loans at June 30, 2022 were greater than 89 days past due.

(3)	Commercial real estate non-accrual loans at June 30, 2022 were greater than 89 days past due.

(4)	Commercial and industrial non-accrual loans at June 30, 2022 were greater than 89 days past due.


(in thousands)	Past Due and Non-Accrual
					Greater than
	30 - 59 days		60 - 89 days		89 days past					Total past		Purchased-
	past due and		past due and		due and					due and non-		credit
September 30, 2021	accruing		accruing		accruing		Non-accrual			accrual		Impaired		Current		Total
Residential real estate	$	1,032	$	1,601	$	—	$	5,554	(1)	$	8,187	$	—	$	435,953	$	444,140
Multi-family		—		—		—		458	(2)		458		—		266,256		266,714
Commercial real estate		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 and land development		—		—		—		—			—		—		15,374		15,374
Consumer		—		—		—		—			—		—		13		13
Total	$	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.

Troubled debt restructurings (“TDRs”) are loan modifications where the Company has granted a concession to a borrower in financial difficulty. To assess whether a borrower is experiencing financial difficulty, an evaluation is performed to determine if that borrower is currently in payment default under any of its obligations or whether there is a probability that the borrower will be in payment default in the foreseeable future without the modification. At June 30, 2022 and September 30, 2021, the Company had a recorded investment in TDRs totaling $1.3 million and $1.6 million, consisting solely of residential real estate loans with no specific reserves allocated to such loans and no commitment to lend additional funds under those loans, at either June 30, 2022 or September 30, 2021.

For the three and nine months ended June 30, 2022 and 2021, there were no TDRs for which there was a payment default within twelve months of restructuring. A loan is considered to be in payment default once it is 90 days contractually past due under its modified terms. For the three and nine months ended June 30, 2022 and 2021, the Company had no new TDRs.

The Company continuously monitors the credit quality of its loan receivables. Credit quality is monitored by reviewing certain credit quality indicators. Management has determined that internally assigned credit risk ratings by loan segment are the key credit quality indicators that best assist management in monitoring the credit quality of the Company’s loan receivables.

The Company has adopted a credit risk rating system as part of the risk assessment of its loan portfolio. The Company’s lending officers are required to assign a credit risk rating to each loan in their portfolio at origination. When the lender learns of important financial developments, the risk rating is reviewed and adjusted if necessary. In addition, the Company engages a third-party independent loan reviewer that performs quarterly reviews of a sample of loans, validating the credit risk ratings assigned to such loans. The credit risk ratings play an important role in the establishment of the loan loss provision and to confirm the adequacy of the allowance for loan losses.

The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. The Company analyzes commercial loans individually by classifying the loans as to credit risk. The Company uses the following definitions for risk ratings:

Special Mention: The loan has potential weaknesses that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of repayment prospects for the asset or in the Company’s credit position at some future date.

Substandard: The loan is inadequately protected by current sound worth and paying capacity of the obligor or collateral pledged, if any. Loans classified as Substandard must have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the Company will sustain some loss if the deficiencies are not corrected.

Doubtful: The loan has all the weaknesses inherent in one classified substandard with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing factors, conditions, and values, highly questionable and improbable.

Loans not having a credit risk rating of Special Mention, Substandard or Doubtful are considered pass loans.

At June 30, 2022 and September 30, 2021, the Company’s loan portfolio by credit risk rating disaggregated by portfolio segment were as follows:


	June 30, 2022
			Special
(in thousands)	Pass		Mention		Substandard		Doubtful		Total
Real Estate:
Residential	$	426,257	$	516	$	4,636	$	—	$	431,409
Multi-family		473,592		2,821		2,343		—		478,756
Commercial		412,834		8,818		8,301		—		429,953
Commercial and industrial		53,811		637		2,096		—		56,544
Construction and land development		14,806		2,408		—		—		17,214
Consumer		12		—		—		—		12
Total	$	1,381,312	$	15,200	$	17,376	$	—	$	1,413,888


	September 30, 2021
			Special
(in thousands)	Pass		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 and land development		13,607		1,767		—		—		15,374
Consumer		11		—		—		—		11
Total	$	1,194,732	$	26,548	$	25,322	$	3	$	1,246,605

EQUITY COMPENSATION PLANS

9 Months Ended

Jun. 30, 2022

EQUITY COMPENSATION PLANS

EQUITY COMPENSATION PLANS

6. 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, and 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 274,208 shares remain available for issuance at June 30, 2022. Of the total 346,000 shares of common stock approved for issuance under the 2018 Plan, 32,802 shares remain available for issuance at June 30, 2022. 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.

No stock options were exercised during the three and nine months ended June 30, 2022 and 2021.

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


						Weighted
		Weighted				Average
		Average		Aggregate		Remaining
	Number of	Exercise		Intrinsic		Contractual
	Options	Price		Value		Term
Outstanding, October 1, 2021	227,406	$	9.50	$	2,043	3.51 years
Granted	—		—
Exercised	—		—
Forfeited	—		—
Outstanding, June 30, 2022 ⁽¹⁾	227,406	$	9.50	$	2,400	2.70 years

(1)	All outstanding options are fully vested and exercisable.

There was no compensation expense attributable to stock options for the three and nine months ended June 30, 2022 and 2021.

Restricted Stock Awards

During the nine months ended June 30, 2022, restricted stock awards of 44,642 shares were granted with a three-year vesting period and 230,788 were granted with a five-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.

A summary of restricted stock awards activity follows:


		Weighted-Average
	Number of	Grant Date Fair
	Shares	Value
Unvested, October 1, 2021	75,833	$	19.87
Granted	275,430		19.73
Vested	(41,504)		19.77
Forfeited	(10,189)		19.47
Unvested, June 30, 2022	299,570	$	19.77

Compensation expense attributable to restricted stock awards was $482 thousand and $224 thousand for the three months ended June 30, 2022 and 2021, respectively. Compensation expense attributable to restricted stock was $1.1 million and $669 thousand for the nine months ended June 30, 2022 and 2021, respectively. As of June 30, 2022, there was $5.3 million of total unrealized compensation cost related to unvested restricted stock, expected to be recognized over a weighted-average term of 4.12 years. The total fair value of shares vested during the nine months ended June 30, 2022 and 2021 was $824 thousand and $868 thousand, respectively.

Restricted Stock Units

Long Term Incentive Plan

Restricted stock units (RSUs) represent an obligation to deliver shares to a grantee at a future date if certain vesting conditions are met. RSUs are subject to a time-based vesting schedule, and/or the satisfaction of performance conditions, and are settled in shares of the Company's common stock. RSUs do not provide voting rights and RSUs may accrue dividends from the date of grant.

The following table summarizes the unvested performance-based RSU activity for the nine months ended June 30, 2022:


		Weighted-Average
	Number of	Grant Date Fair
	Shares	Value
Unvested, October 1, 2021	—	$	—
Granted	51,097		19.73
Vested	—		—
Forfeited	—		—
Unvested, June 30, 2022	51,097	$	19.73

During the nine months ended June 30, 2022, the Company granted 51,097 RSUs. These performance-based RSUs cliff vest after three years and are subject to the achievement of the Company's pre-defined performance goals for the three-year period ending December 31, 2024.

Compensation expense attributable to RSUs was $82 thousand and $139 thousand, respectively, for the three and nine months ended June 30, 2022. There was no compensation expense related to RSUs for the three and nine months ended June 30, 2021, as no RSUs were granted in 2021. As of June 30, 2022, there was $869 thousand of total unrecognized compensation cost related to non-vested RSUs. The cost is expected to be recognized over a weighted-average period of 2.7 years.

REGULATORY MATTERS

9 Months Ended

Jun. 30, 2022

REGULATORY MATTERS

REGULATORY MATTERS

7. REGULATORY MATTERS

The Bank is subject to various regulatory capital requirements administered by federal banking agencies. Capital adequacy guidelines and, additionally, 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 June 30, 2022, 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 or worse, 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 June 30, 2022 and September 30, 2021, 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.

Under a policy of the Federal Reserve applicable to bank holding companies with less than $3.0 billion in consolidated assets, the Company is not subject to consolidated regulatory capital requirements.

The following table sets forth the Bank’s capital amounts (in thousands) and ratios under current regulations:


									Minimum Capital				Minimum to Be Well
									Adequacy Requirement				Capitalized Under
					Minimum Capital				with Capital				Prompt Corrective
	Actual Capital				Adequacy Requirement				Conservation Buffer				Action Provisions
	Amount		Ratio		Amount		Ratio		Amount		Ratio		Amount		Ratio
June 30, 2022
Total capital to risk-weighted assets	$	182,811	17.32	%	$	84,444	8.00	%	$	110,833	10.50	%	$	105,555	10.00	%
Tier 1 capital to risk-weighted assets		171,753	16.27	%		63,333	6.00	%		89,722	8.50	%		84,444	8.00	%
Common equity tier 1 capital to risk-weighted assets		171,753	16.27	%		47,500	4.50	%		73,889	7.00	%		68,611	6.50	%
Tier 1 capital to adjusted average assets (leverage)		171,753	11.64	%		59,007	4.00	%		N/A	N/A			73,759	5.00	%

September 30, 2021
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 adjusted average assets (leverage)		123,666	9.45	%		52,338	4.00	%		N/A	N/A			65,423	5.00	%

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 June 30, 2022, the Bank had $46.6 million of retained net income available for dividends to the Company.

- Definition

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.

+ References + Details

FAIR VALUE

9 Months Ended

Jun. 30, 2022

FAIR VALUE

FAIR VALUE

8. FAIR VALUE

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 presents fair value measurements on a recurring basis at June 30, 2022 and September 30, 2021:


	June 30, 2022
			Fair Value Measurements Using:
			Quoted Prices In				Significant
			Active Markets		Significant Other		Unobservable
	Carrying		for Identical Assets		Observable Inputs		Inputs
(In thousands)	Amount		(Level 1)		(Level 2)		(Level 3)
Financial assets:
Available-for-sale securities:
U.S. GSE residential mortgage-backed securities	$	319	$	—	$	319	$	—
Corporate bonds		6,421		—		6,421		—
Mortgage servicing rights		4,120		—		—		4,120
Total	$	10,860	$	—	$	6,740	$	4,120


	September 30, 2021
			Fair Value Measurements Using:
			Quoted Prices In
			Active Markets				Significant
			for Identical		Significant Other		Unobservable
	Carrying		Assets		Observable Inputs		Inputs
(In thousands)	Amount		(Level 1)		(Level 2)		(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

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. The fair value of loan servicing rights related to residential mortgage loans at June 30, 2022 was determined based on discounted expected future cash flows using discount rates ranging from 12.0% to 14.5%, a prepayment speed of 26.25% and a weighted average life ranging from 1.29 to 3.03 years. Fair value at September 30, 2021 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 24.18% to 24.33% and a weighted average life ranging from 1.96 to 3.30 years.

The fair value of loan servicing rights for SBA loans at June 30, 2022 was determined based on discounted expected future cash flows using discount rates ranging from 4.86% to 23.04%, prepayment speeds ranging from 9.20% to 25.84% and a weighted average life ranging from 0.04 to 5.83 years.

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

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


	Three Months Ended June 30,				Nine Months Ended June 30,
(in thousands)	2022		2021		2022		2021
Balance at beginning of period	$	4,028	$	130	$	3,690	$	155
Additions		211		3,776		784		3,776
Adjustment to fair value		(119)		(91)		(354)		(116)
Balance at end of period	$	4,120	$	3,815	$	4,120	$	3,815

Assets Measured at Fair Value on a Non-recurring Basis

The Company had no financial instruments measured at fair value on a non-recurring basis at June 30, 2022 and September 30, 2021. The Company’s impaired loans had no related specific allowances recorded at June 30, 2022 and September 30, 2021.

Financial Instruments Not Measured at Fair Value

The following presents the carrying amounts and estimated fair values of the Company’s financial instruments not carried at fair value at June 30, 2022 and September 30, 2021:


	June 30, 2022
			Fair Value Measurements Using:
			Quoted Prices In
			Active Markets				Significant
			for Identical		Significant Other		Unobservable
	Carrying		Assets		Observable Inputs		Inputs		Total Fair
(In thousands)	Amount		(Level 1)		(Level 2)		(Level 3)		Value
Financial assets:
Cash and cash equivalents	$	133,974	$	133,974	$	—	$	—	$	133,974
Securities held-to-maturity		4,509		—		4,309		—		4,309
Securities available-for-sale		6,740		—		6,740		—		6,740
Loans, net		1,404,891		—		—		1,379,005		1,379,005
FHLB stock		3,858		N/A		N/A		N/A		N/A
Accrued interest receivable		7,643		—		117		7,526		7,643
Financial Liabilities:
Time deposits		298,272		—		291,890		—		291,890
Demand and other deposits		1,051,277		1,051,277		—		—		1,051,277
Borrowings		56,963		—		57,192		—		57,192
Subordinated debentures		24,554		—		24,698		—		24,698
Accrued interest payable		611		1		610		—		611


	September 30, 2021
			Fair Value Measurements Using:
			Quoted Prices In
			Active Markets				Significant
			for Identical		Significant Other		Unobservable
	Carrying		Assets		Observable Inputs		Inputs		Total Fair
(In thousands)	Amount		(Level 1)		(Level 2)		(Level 3)		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
Loans, net		1,238,573		—		—		1,278,056		1,278,056
FHLB stock		3,714		N/A		N/A		N/A		N/A
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

- Definition

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.

+ References + Details

LOSS CONTINGENCIES

9 Months Ended

Jun. 30, 2022

LOSS CONTINGENCIES

LOSS CONTINGENCIES

9. LOSS CONTINGENCIES

Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of a loss is probable and an amount or range of loss can be reasonably estimated. The Company’s management does not believe there now are such matters that will have a material effect on the financial statements.

BORROWINGS

9 Months Ended

Jun. 30, 2022

BORROWINGS

BORROWINGS

10. BORROWINGS

Federal Home Loan Bank (“FHLB”) Advances

At June 30, 2022 and September 30, 2021, FHLB advances outstanding were $37.8 million and $42.0 million, respectively. The advances were all at fixed rates ranging from 0.37% to 2.96%, and with maturities ranging from January 2023 to August 2025 and from October 2021 to August 2025, respectively, at June 30, 2022 and September 30, 2021.

Each advance is payable at its maturity date, with a prepayment penalty for fixed rate advances. The advances were collateralized by $673.5 million and $432.7 million of residential and commercial mortgage loans under a blanket lien arrangement at June 30, 2022 and September 30, 2021, 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 $183.3 million at June 30, 2022.

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 June 30,
	2022
			Weighted
Contractual Maturity	Amount		Average Rate
2022	$	—	—	%
2023		11,905	2.23	%
2024		18,860	0.98	%
2025		7,080	0.58	%
Total	$	37,845	1.30	%


	Balance at September 30,
	2021
			Weighted
Contractual Maturity	Amount		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	%

Federal Reserve Borrowings

At June 30 2022 and September 30, 2021, the Company’s borrowings from the Federal Reserve’s Paycheck Protection Program Liquidity Facility (“PPPLF”) were $18.9 million and $117.7 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 secured by pledged PPP loans as of June 30, 2022 and September 30, 2021.

Correspondent Bank Borrowings

At June 30, 2022, approximately $55 million in unsecured lines of credit extended by correspondent banks were available to be utilized for short-term funding purposes. The Company has $250 thousand in borrowings outstanding under lines of credit with correspondent banks at June 30, 2022 and zero at September 30, 2021.

- Definition

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.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-URI http://asc.fasb.org/topic&trid=2208564

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (h)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(c))
-URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (g)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1E
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495348-112611

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (i)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

+ Details

SUBORDINATED DEBENTURES

9 Months Ended

Jun. 30, 2022

SUBORDINATED DEBENTURES

SUBORDINATED DEBENTURES

11. SUBORDINATED DEBENTURES

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 through maturity, 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. The portion of the proceeds of these subordinated notes contributed to the Bank are included as a component of the Bank’s Tier 1 capital for regulatory reporting.

At June 30, 2022 and September 30, 2021, the unamortized issuance costs of the Notes were $0.4 million and $0.5 million, respectively. For the three and nine months ended June 30, 2022, $21 thousand and $64 thousand, respectively, in issuance costs were recorded in interest expense. For the three and nine months ended June 30, 2021, $16 thousand and $43 thousand, respectively, in issuance costs were recorded in interest expense. The Notes are presented net of unamortized issuance costs in the Company’s Consolidated Statements of Financial Condition.

ACCUMULATED OTHER COMPREHENSIVE INCOME

9 Months Ended

Jun. 30, 2022

ACCUMULATED OTHER COMPREHENSIVE INCOME

ACCUMULATED OTHER COMPREHENSIVE INCOME

12. ACCUMULATED OTHER COMPREHENSIVE INCOME

The following table presents changes in accumulated other comprehensive income (loss) by component, net of tax, for the nine months ended June 30, 2022 and 2021:


	Unrealized Gains and
	Losses on Available-
	for-Sale Debt
(in thousands)	Securities
Balance at October 1, 2021	$	256
Other comprehensive loss, before reclassification		(451)
Amount reclassified from accumulated other comprehensive income		(81)
Net current period other comprehensive loss		(532)
Balance at June 30, 2022	$	(276)



	Unrealized Gains and
	Losses on Available-
	for-Sale Debt
(in thousands)	Securities
Balance at October 1, 2020	$	156
Other comprehensive income, before reclassification		288
Amount reclassified from accumulated other comprehensive income		(191)
Net current period other comprehensive income		97
Balance at June 30, 2021	$	253

The following represents the reclassification out of accumulated other comprehensive income for the three and nine months ended June 30, 2022 and 2021.


	Three Months Ended				Nine Months Ended
	June 30,				June 30,				Affected Line Item in Consolidated
(in thousands)	2022		2021		2022		2021		Statements of Income
Realized gains on securities available-for-sale	$	—	$	—	$	105	$	240	Gain on sale of investment securities available-for-sale, net
Tax effect		—		—		24		49	Income tax expense
Net of tax	$	—	$	—	$	81	$	191

BASIS OF PRESENTATION, RISKS AND UNCERTAINTIES, ACCOUNTING POLICIES AND RECENT ACCOUNTING DEVELOPMENTS (Policies)	9 Months Ended
	Jun. 30, 2022
BASIS OF PRESENTATION, RISKS AND UNCERTAINTIES, ACCOUNTING POLICIES AND RECENT ACCOUNTING DEVELOPMENTS
Basis of Presentation	Basis of Presentation In the opinion of the Company’s management, the preceding unaudited interim consolidated financial statements contain all adjustments, consisting of normal accruals, necessary for a fair presentation of the Company’s consolidated statement of financial condition as of June 30, 2022, its consolidated statements of income for the three and nine months ended June 30, 2022 and 2021, its consolidated statements of comprehensive income for the three and nine months ended June 30, 2022 and 2021, its consolidated statements of changes in stockholders’ equity for the three and nine months ended June 30, 2022 and 2021 and its consolidated statements of cash flows for the nine months ended June 30, 2022 and 2021. Certain prior period amounts have been reclassified to conform to the current period presentation. In addition, the preceding unaudited interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X, as well as in accordance with predominant practices within the banking industry. They do not include all the information and footnotes required by U.S. GAAP for complete financial statements. The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and the accompanying notes. Actual results could differ from those estimates. The results of operations for the three and nine months ended June 30, 2022 are not necessarily indicative of the results of operations to be expected for the remainder of the year. The unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2021. All material intercompany accounts and transactions have been eliminated in consolidation. Unless the context otherwise requires, references herein to the Company include the Company and the Bank on a consolidated basis.
Risks and Uncertainties	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 Coronavirus Aid, Relief, and Economic Security Act (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 ongoing 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, the spread of new variants of the virus, 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.
Allowance for Loan Losses	Allowance for Loan Losses – The Company considers the determination of the allowance for loan losses its most critical accounting policy, practice, and use of estimates. The Company 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. The allowance for loan losses is increased by a 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. The adequacy of the allowance to cover any inherent loan losses in the portfolio is evaluated on a quarterly basis.
Loans and Loan Interest Income Recognition	Loans and Loan Interest Income Recognition - Loans that the Company 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, multi-family, commercial real estate, commercial and industrial, construction and land development, 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. Loans that are acquired are initially recorded at fair value with no carryover of the related allowance for loan losses. After acquisition, losses are recognized through the allowance for loan losses. Determining the fair value of the loans involves estimating the amount and timing of expected principal and interest cash flows to be collected on the loans and discounting those cash flows at a market interest rate. At June 30, 2022 and September 30, 2021, the Company had loans totaling $1.2 million and $10.2 million, respectively, which at the time of acquisition, showed evidence of credit deterioration since origination.
Loans Held for Sale	Loans Held for Sale - Mortgage loans originated and intended for sale in the secondary market are carried at the lower of aggregate cost or estimated fair value as determined by outstanding commitments from investors. Periodically, the Company originates various residential mortgage loans for sale to investors generally on a servicing released basis. The sale of such loans is generally arranged through a master commitment on a best-efforts basis. Net unrealized losses, if any, are recorded as a valuation allowance and charged to earnings. Premiums, discounts, origination fees and costs on loans held for sale are deferred and recognized as a component of the gain or loss on sale. Gains and losses on sales of loans held for sale are included in other income, recognized on settlement date and are determined to be the difference between the sale proceeds and the carrying value of the loans. These transactions are accounted for as sales based on satisfaction of the criteria for such accounting which provides that, as transferor, the Company has surrendered control of the loans. For liquidity purposes generally, there are instances when loans originated with the intent to hold in the portfolio are subsequently transferred to loans held for sale. At transfer, they are carried at the lower of cost or fair value.
Recent Accounting Developments	Recent Accounting Developments 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 (“CECL”), 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 standard 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. 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.

BUSINESS COMBINATIONS (Tables)

9 Months Ended

Jun. 30, 2022

BUSINESS COMBINATIONS

Fair Value of Assets Received and Liabilities Assumed

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


	As Recorded		Fair Value			As Recorded
(in thousands)	by Savoy		Adjustments			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)	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.

(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)	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.

(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 share data)
Common stock issued (1,357,567 shares issued)	$	31,252
Rollover options		1,269
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

EARNINGS PER COMMON SHARE (Tables)

9 Months Ended

Jun. 30, 2022

EARNINGS PER COMMON SHARE

Calculations of Basic and Diluted Earnings Per Share


	Three Months Ended June 30,				Nine Months Ended June 30,
(in thousands, except share and per share data)	2022		2021		2022		2021
Basic earnings per common share
Net income	$	5,333	$	221	$	17,730	$	3,795
Weighted average common shares outstanding		6,596,505		4,731,949		5,970,288		4,368,809
Basic earnings per common share	$	0.81	$	0.05	$	2.97	$	0.87
Diluted earnings per common share
Net income	$	5,333	$	221	$	17,730	$	3,795
Weighted average common shares outstanding for basic earnings per common share		6,596,505		4,731,949		5,970,288		4,368,809
Add: dilutive effects of assumed exercises of stock options		99,062		84,311		99,206		84,129
Average shares and dilutive potential common shares		6,695,567		4,816,260		6,069,494		4,452,938
Diluted earnings per common share	$	0.80	$	0.05	$	2.92	$	0.85

SECURITIES (Tables)

9 Months Ended

Jun. 30, 2022

SECURITIES [Abstract]

Investment Securities Available for Sale and Held to Maturity


	June 30, 2022
	Amortized		Gross Unrealized		Gross Unrealized
(in thousands)	Cost		Gains		Losses		Fair Value
Available for sale:
U.S. GSE residential mortgage-backed securities	$	390	$	—	$	(71)	$	319
Corporate bonds		6,700		—		(279)		6,421
Total available for sale securities	$	7,090	$	—	$	(350)	$	6,740

Held to maturity:
U.S. GSE residential mortgage-backed securities	$	1,858	$	—	$	(117)	$	1,741
U.S. GSE commercial mortgage-backed securities		2,651		—		(83)		2,568
Total held to maturity securities		4,509		—		(200)		4,309
Total investment securities	$	11,599	$	—	$	(550)	$	11,049


	September 30, 2021
			Gross		Gross
	Amortized		Unrealized		Unrealized
(in thousands)	Cost		Gains		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 securities	$	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 securities		8,611		258		(4)		8,865
Total investment securities	$	16,033	$	584	$	(5)	$	16,612

Securities Portfolio by Contractual Maturity


	June 30, 2022
	Amortized		Fair
(in thousands)	Cost		Value
Securities available for sale:
Five to ten years	$	6,700	$	6,421
U.S. GSE residential mortgage-backed securities		390		319
Total securities available for sale		7,090		6,740
Securities held to maturity:
One to five years		—		—
Five to ten years		—		—
U.S. GSE residential mortgage-backed securities		1,858		1,741
U.S. GSE commercial mortgage-backed securities		2,651		2,568
Total securities held to maturity		4,509		4,309
Total investment securities	$	11,599	$	11,049

LOANS (Tables)

9 Months Ended

Jun. 30, 2022

LOANS

Major Classifications of Loans

The following table sets forth the classification of the Company’s loans by loan portfolio segment for the periods presented.


	June 30, 2022		September 30, 2021
(in thousands)
Residential real estate	$	431,409	$	444,011
Multi-family		478,756		266,294
Commercial real estate		429,953		348,641
Commercial and industrial		56,544		172,274
Construction and land development		17,214		15,374
Consumer		12		11
Gross loans		1,413,888		1,246,605
Net deferred costs (fees)		1,889		520
Total loans		1,415,777		1,247,125
Allowance for loan losses		(10,886)		(8,552)
Total loans, net	$	1,404,891	$	1,238,573

Carrying Amount for Purchased Credit Impaired Loans


	June 30,		September 30,
	2022		2021
(in thousands)
Commercial real estate	$	595	$	8,324
Commercial and industrial		642		1,917
Total recorded investment	$	1,237	$	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:


	Three Months Ended		Nine Months Ended
(in thousands)	June 30, 2022		June 30, 2022
Balance at beginning of period	$	88	$	346
Accretable differences acquired		—		—
Accretion		(16)		(1,799)
Adjustments to accretable difference due to changes in expected cash flows		—		(381)
Other changes, net		—		1,906
Ending balance	$	72	$	72

Activity in Allowance for Loan Losses by Portfolio Segment

The following summarizes the activity in the allowance for loan losses by portfolio segment for the periods indicated:


	Three Months Ended June 30, 2022
							Commercial		Construction
	Residential		Multi-		Commercial		and		and Land
	Real Estate		Family		Real Estate		Industrial		Development		Consumer
	Loans		Loans		Loans		Loans		Loans		Loans		Total
(in thousands)
Allowance for loan losses:
Beginning balance	$	3,400	$	2,627	$	3,327	$	532	$	—	$	—	$	9,886
Charge-offs		—		—		—		—		—		—		—
Recoveries		—		—		—		—		—		—		—
Provision (credit) for loan losses		(168)		503		479		103		82		1		1,000
Ending Balance	$	3,232	$	3,130	$	3,806	$	635	$	82	$	1	$	10,886


	Three Months Ended June 30, 2021
							Commercial		Construction
	Residential		Multi-		Commercial		and		and Land
	Real Estate		Family		Real Estate		Industrial		Development		Consumer
	Loans		Loans		Loans		Loans		Loans		Loans		Total
(in thousands)
Allowance for loan losses:
Beginning balance	$	4,851	$	1,955	$	1,310	$	62	$	—	$	1	$	8,179
Charge-offs		(267)		(32)		(29)		—		—		—		(328)
Recovories		—		—		—		1		—		—		1
Provision (credit) for loan losses		(209)		(23)		228		4		—		—		—
Ending balance	$	4,375	$	1,900	$	1,509	$	67	$	—	$	1	$	7,852


	Nine Months Ended June 30, 2022
							Commercial		Construction
	Residential		Multi-		Commercial		and		and Land
	Real Estate		Family		Real Estate		Industrial		Development		Consumer
	Loans		Loans		Loans		Loans		Loans		Loans		Total
(in thousands)
Allowance for loan losses:
Beginning Balance	$	4,155	$	2,433	$	1,884	$	79	$	—	$	1	$	8,552
Charge-offs		—		(66)		—		—		—		—		(66)
Recoveries		—		—		—		—		—		—		—
Provision (credit) for loan losses		(923)		763		1,922		556		82		—		2,400
Ending Balance	$	3,232	$	3,130	$	3,806	$	635	$	82	$	1	$	10,886


	Nine Months Ended June 30, 2021
							Commercial		Construction
	Residential		Multi-		Commercial		and		and Land
	Real Estate		Family		Real Estate		Industrial		Development		Consumer
	Loans		Loans		Loans		Loans		Loans		Loans		Total
(in thousands)
Allowance for loan losses:
Beginning Balance	$	5,103	$	1,506	$	1,221	$	38	$	—	$	1	$	7,869
Charge-offs		(267)		(32)		(29)		—		—		—		(328)
Recoveries		—		—		—		11		—		—		11
Provision (credit) for loan losses		(461)		426		317		18		—		—		300
Ending Balance	$	4,375	$	1,900	$	1,509	$	67	$	—	$	1	$	7,852

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


	June 30, 2022
							Commercial		Construction
	Residential		Multi-		Commercial		and		and Land
(in thousands)	Real Estate		Family		Real Estate		Industrial		Development		Consumer		Total
Allowance for loan losses:
Individually evaluated for impairment	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Collectively evaluated for impairment		3,232		3,130		3,806		635		82		1		10,886
Purchased-credit impaired		—		—		—		—		—		—		—
Total allowance for loan losses	$	3,232	$	3,130	$	3,806	$	635	$	82	$	1	$	10,886
Loans:
Individually evaluated for impairment	$	5,427	$	2,343	$	5,844	$	205	$	—	$	—	$	13,819
Collectively evaluated for impairment		426,421		477,023		423,925		56,085		17,254		13		1,400,721
Purchased-credit impaired		—		—		595		642		—		—		1,237
Total loans held for investment	$	431,848	$	479,366	$	430,364	$	56,932	$	17,254	$	13	$	1,415,777


	September 30, 2021
							Commercial		Construction
	Residential		Multi-		Commercial		and			and Land
(in thousands)	Real Estate		Family		Real Estate		Industrial		Development		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

Impaired Loans by Portfolio Segment

The following presents information related to the Company’s impaired loans by portfolio segment for the periods shown.


	June 30, 2022						September 30, 2021
	Unpaid						Unpaid
	Principal		Recorded		Allowance		Principal		Recorded		Allowance
(in thousands)	Balance		Investment		Allocated		Balance		Investment		Allocated
With no related allowance recorded:
Residential real estate	$	5,358	$	5,427	$	—	$	7,382	$	7,198	$	—
Multi-family		2,264		2,343		—		382		458		—
Commercial real estate		5,822		5,844		—		522		517		—
Commercial and industrial		220		205		—		535		500		—
Total	$	13,664	$	13,819	$	—	$	8,821	$	8,673	$	—


	Three Months Ended June 30,								Nine Months Ended June 30,
	2022				2021				2022				2021
	Average		Interest		Average		Interest		Average		Interest		Average		Interest
	Recorded		Income		Recorded		Income		Recorded		Income		Recorded		Income
(in thousands)	Investment		Recognized⁽¹⁾		Investment		Recognized⁽¹⁾		Investment		Recognized⁽¹⁾		Investment		Recognized⁽¹⁾
Residential real estate	$	5,034	$	17	$	5,937	$	35	$	4,400	$	50	$	4,890	$	76
Multi-family		1,058		—		171		3		641		—		85		7
Commercial real estate		5,851		—		193		1		2,883		—		81		2
Commercial and industrial		207		—		181		—		200		—		60		—
Total	$	12,150	$	17	$	6,482	$	39	$	8,124	$	50	$	5,116	$	85

(1)	Accrual basis interest income recognized approximates cash basis income.

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

At June 30, 2022 and September 30, 2021, past due and non-accrual loans disaggregated by portfolio segment were as follows:


(in thousands)	Past Due and Non-Accrual
					Greater than
	30 - 59 days		60 - 89 days		89 days past					Total past		Purchased-
	past due and		past due and		due and					due and non-		credit
June 30, 2022	accruing		accruing		accruing		Non-accrual			accrual		impaired		Current		Total
Residential real estate	$	1,928	$	—	$	—	$	4,099	(1)	$	6,027	$	—	$	425,821	$	431,848
Multi-family		—		1,230		—		2,342	(2)		3,572		—		475,794		479,366
Commercial real estate		—		—		—		5,844	(3)		5,844		595		423,925		430,364
Commercial and industrial		—		978		—		206	(4)		1,184		642		55,106		56,932
Construction and land development		—		—		—		—			—		—		17,254		17,254
Consumer		—		—		—		—			—		—		13		13
Total	$	1,928	$	2,208	$	—	$	12,491		$	16,627	$	1,237	$	1,397,913	$	1,415,777

(1)	Of the residential real estate non-accrual loans, $2,184 were current and $1,915 were greater than 89 days past due.

(2)	Multi-family non-accrual loans at June 30, 2022 were greater than 89 days past due.

(3)	Commercial real estate non-accrual loans at June 30, 2022 were greater than 89 days past due.

(4)	Commercial and industrial non-accrual loans at June 30, 2022 were greater than 89 days past due.


(in thousands)	Past Due and Non-Accrual
					Greater than
	30 - 59 days		60 - 89 days		89 days past					Total past		Purchased-
	past due and		past due and		due and					due and non-		credit
September 30, 2021	accruing		accruing		accruing		Non-accrual			accrual		Impaired		Current		Total
Residential real estate	$	1,032	$	1,601	$	—	$	5,554	(1)	$	8,187	$	—	$	435,953	$	444,140
Multi-family		—		—		—		458	(2)		458		—		266,256		266,714
Commercial real estate		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 and land development		—		—		—		—			—		—		15,374		15,374
Consumer		—		—		—		—			—		—		13		13
Total	$	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.

Loan Portfolio Based on Internal Rating Category

At June 30, 2022 and September 30, 2021, the Company’s loan portfolio by credit risk rating disaggregated by portfolio segment were as follows:


	June 30, 2022
			Special
(in thousands)	Pass		Mention		Substandard		Doubtful		Total
Real Estate:
Residential	$	426,257	$	516	$	4,636	$	—	$	431,409
Multi-family		473,592		2,821		2,343		—		478,756
Commercial		412,834		8,818		8,301		—		429,953
Commercial and industrial		53,811		637		2,096		—		56,544
Construction and land development		14,806		2,408		—		—		17,214
Consumer		12		—		—		—		12
Total	$	1,381,312	$	15,200	$	17,376	$	—	$	1,413,888


	September 30, 2021
			Special
(in thousands)	Pass		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 and land development		13,607		1,767		—		—		15,374
Consumer		11		—		—		—		11
Total	$	1,194,732	$	26,548	$	25,322	$	3	$	1,246,605

EQUITY COMPENSATION PLANS (Tables)

9 Months Ended

Jun. 30, 2022

EQUITY COMPENSATION PLANS

Summary of Stock Option Activity

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


						Weighted
		Weighted				Average
		Average		Aggregate		Remaining
	Number of	Exercise		Intrinsic		Contractual
	Options	Price		Value		Term
Outstanding, October 1, 2021	227,406	$	9.50	$	2,043	3.51 years
Granted	—		—
Exercised	—		—
Forfeited	—		—
Outstanding, June 30, 2022 ⁽¹⁾	227,406	$	9.50	$	2,400	2.70 years

(1)	All outstanding options are fully vested and exercisable.

Summary of Restricted Stock Activity

A summary of restricted stock awards activity follows:


		Weighted-Average
	Number of	Grant Date Fair
	Shares	Value
Unvested, October 1, 2021	75,833	$	19.87
Granted	275,430		19.73
Vested	(41,504)		19.77
Forfeited	(10,189)		19.47
Unvested, June 30, 2022	299,570	$	19.77

Summary of Restricted Stock Units Activity


		Weighted-Average
	Number of	Grant Date Fair
	Shares	Value
Unvested, October 1, 2021	—	$	—
Granted	51,097		19.73
Vested	—		—
Forfeited	—		—
Unvested, June 30, 2022	51,097	$	19.73

REGULATORY MATTERS (Tables)

9 Months Ended

Jun. 30, 2022

REGULATORY MATTERS

Capital Amounts and Ratios

The following table sets forth the Bank’s capital amounts (in thousands) and ratios under current regulations:


									Minimum Capital				Minimum to Be Well
									Adequacy Requirement				Capitalized Under
					Minimum Capital				with Capital				Prompt Corrective
	Actual Capital				Adequacy Requirement				Conservation Buffer				Action Provisions
	Amount		Ratio		Amount		Ratio		Amount		Ratio		Amount		Ratio
June 30, 2022
Total capital to risk-weighted assets	$	182,811	17.32	%	$	84,444	8.00	%	$	110,833	10.50	%	$	105,555	10.00	%
Tier 1 capital to risk-weighted assets		171,753	16.27	%		63,333	6.00	%		89,722	8.50	%		84,444	8.00	%
Common equity tier 1 capital to risk-weighted assets		171,753	16.27	%		47,500	4.50	%		73,889	7.00	%		68,611	6.50	%
Tier 1 capital to adjusted average assets (leverage)		171,753	11.64	%		59,007	4.00	%		N/A	N/A			73,759	5.00	%

September 30, 2021
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 adjusted average assets (leverage)		123,666	9.45	%		52,338	4.00	%		N/A	N/A			65,423	5.00	%

FAIR VALUE (Tables)

9 Months Ended

Jun. 30, 2022

FAIR VALUE

Assets Measured at Fair Value on Recurring Basis

The following presents fair value measurements on a recurring basis at June 30, 2022 and September 30, 2021:


	June 30, 2022
			Fair Value Measurements Using:
			Quoted Prices In				Significant
			Active Markets		Significant Other		Unobservable
	Carrying		for Identical Assets		Observable Inputs		Inputs
(In thousands)	Amount		(Level 1)		(Level 2)		(Level 3)
Financial assets:
Available-for-sale securities:
U.S. GSE residential mortgage-backed securities	$	319	$	—	$	319	$	—
Corporate bonds		6,421		—		6,421		—
Mortgage servicing rights		4,120		—		—		4,120
Total	$	10,860	$	—	$	6,740	$	4,120


	September 30, 2021
			Fair Value Measurements Using:
			Quoted Prices In
			Active Markets				Significant
			for Identical		Significant Other		Unobservable
	Carrying		Assets		Observable Inputs		Inputs
(In thousands)	Amount		(Level 1)		(Level 2)		(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

Changes in Mortgage Servicing Rights

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


	Three Months Ended June 30,				Nine Months Ended June 30,
(in thousands)	2022		2021		2022		2021
Balance at beginning of period	$	4,028	$	130	$	3,690	$	155
Additions		211		3,776		784		3,776
Adjustment to fair value		(119)		(91)		(354)		(116)
Balance at end of period	$	4,120	$	3,815	$	4,120	$	3,815

Carrying Amounts and Fair Value of Financial Instruments

The following presents the carrying amounts and estimated fair values of the Company’s financial instruments not carried at fair value at June 30, 2022 and September 30, 2021:


	June 30, 2022
			Fair Value Measurements Using:
			Quoted Prices In
			Active Markets				Significant
			for Identical		Significant Other		Unobservable
	Carrying		Assets		Observable Inputs		Inputs		Total Fair
(In thousands)	Amount		(Level 1)		(Level 2)		(Level 3)		Value
Financial assets:
Cash and cash equivalents	$	133,974	$	133,974	$	—	$	—	$	133,974
Securities held-to-maturity		4,509		—		4,309		—		4,309
Securities available-for-sale		6,740		—		6,740		—		6,740
Loans, net		1,404,891		—		—		1,379,005		1,379,005
FHLB stock		3,858		N/A		N/A		N/A		N/A
Accrued interest receivable		7,643		—		117		7,526		7,643
Financial Liabilities:
Time deposits		298,272		—		291,890		—		291,890
Demand and other deposits		1,051,277		1,051,277		—		—		1,051,277
Borrowings		56,963		—		57,192		—		57,192
Subordinated debentures		24,554		—		24,698		—		24,698
Accrued interest payable		611		1		610		—		611


	September 30, 2021
			Fair Value Measurements Using:
			Quoted Prices In
			Active Markets				Significant
			for Identical		Significant Other		Unobservable
	Carrying		Assets		Observable Inputs		Inputs		Total Fair
(In thousands)	Amount		(Level 1)		(Level 2)		(Level 3)		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
Loans, net		1,238,573		—		—		1,278,056		1,278,056
FHLB stock		3,714		N/A		N/A		N/A		N/A
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

BORROWINGS (Tables)

9 Months Ended

Jun. 30, 2022

BORROWINGS

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 June 30,
	2022
			Weighted
Contractual Maturity	Amount		Average Rate
2022	$	—	—	%
2023		11,905	2.23	%
2024		18,860	0.98	%
2025		7,080	0.58	%
Total	$	37,845	1.30	%


	Balance at September 30,
	2021
			Weighted
Contractual Maturity	Amount		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	%

ACCUMULATED OTHER COMPREHENSIVE INCOME (Tables)

9 Months Ended

Jun. 30, 2022

ACCUMULATED OTHER COMPREHENSIVE INCOME

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

The following table presents changes in accumulated other comprehensive income (loss) by component, net of tax, for the nine months ended June 30, 2022 and 2021:


	Unrealized Gains and
	Losses on Available-
	for-Sale Debt
(in thousands)	Securities
Balance at October 1, 2021	$	256
Other comprehensive loss, before reclassification		(451)
Amount reclassified from accumulated other comprehensive income		(81)
Net current period other comprehensive loss		(532)
Balance at June 30, 2022	$	(276)



	Unrealized Gains and
	Losses on Available-
	for-Sale Debt
(in thousands)	Securities
Balance at October 1, 2020	$	156
Other comprehensive income, before reclassification		288
Amount reclassified from accumulated other comprehensive income		(191)
Net current period other comprehensive income		97
Balance at June 30, 2021	$	253

Significant Amounts Reclassified Out of Accumulated Other Comprehensive Income


	Three Months Ended				Nine Months Ended
	June 30,				June 30,				Affected Line Item in Consolidated
(in thousands)	2022		2021		2022		2021		Statements of Income
Realized gains on securities available-for-sale	$	—	$	—	$	105	$	240	Gain on sale of investment securities available-for-sale, net
Tax effect		—		—		24		49	Income tax expense
Net of tax	$	—	$	—	$	81	$	191

BASIS OF PRESENTATION, RISKS AND UNCERTAINTIES, ACCOUNTING POLICIES AND RECENT ACCOUNTING DEVELOPMENTS (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Sep. 30, 2021
Loans and Loan Interest Income Recognition
Loans with evidence of credit deterioration since origination	$ 1,237	$ 10,241
Financial Asset Acquired with Credit Deterioration
Loans and Loan Interest Income Recognition
Loans with evidence of credit deterioration since origination	$ 1,200	$ 10,200

BUSINESS COMBINATIONS - Fair Value of Assets Received and Liabilities Assumed (Details) - USD ($) $ / shares in Units, $ in Thousands	May 26, 2021	Apr. 30, 2021	Jun. 30, 2022	Sep. 30, 2021
Business Combination, Description [Abstract]
Common Stock, Par or Stated Value Per Share			$ 0.01	$ 0.01
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Liabilities [Abstract]
Goodwill			$ 19,168	$ 19,168
Savoy Bank
Business Combination, Description [Abstract]
Total consideration	$ 65,512
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets [Abstract]
Cash and due from banks	59,155
Investment securities available-for-sale	239
Loans held for sale	3,883
Loans held for investment	569,251
Premises and equipment, net	234
Accrued interest receivable	5,171
Other assets	10,432
Total assets acquired	648,365
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Liabilities [Abstract]
Deposits	340,215
Borrowings	258,247
Accrued interest payable	1,050
Other liabilities and accrued expenses	3,817
Total liabilities assumed	603,329
Total Consideration	65,512
Savoy Bank \| Changes Measurement [Member]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets [Abstract]
Loans held for investment	8,612
Premises and equipment, net	(22)
Core deposit intangible	490
Accrued interest receivable	(650)
Other assets	(2,925)
Total assets acquired	5,505
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Liabilities [Abstract]
Deposits	2,527
Borrowings	301
Other liabilities and accrued expenses	(342)
Total liabilities assumed	2,486
Savoy Bank \| As Adjusted
Business Combination, Description [Abstract]
Total consideration	65,512
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets [Abstract]
Cash and due from banks	59,155
Investment securities available-for-sale	239
Loans held for sale	3,883
Loans held for investment	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
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Liabilities [Abstract]
Deposits	342,742
Borrowings	258,548
Accrued interest payable	1,050
Other liabilities and accrued expenses	3,475
Total liabilities assumed	605,815
Net assets acquired	48,055
Total Consideration	65,512
Goodwill	$ 17,457
Savoy Bank \| Common Stock
Business Combination, Description [Abstract]
Common Stock, Par or Stated Value Per Share		$ 1.00
Business Combination, Cash Paid Per Share		$ 3.246
Conversion of Stock, Shares Issued Per Share		0.141
Total consideration		$ 65,500
Business Acquisition, Share Price		$ 6.49
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Liabilities [Abstract]
Total Consideration		$ 65,500

BUSINESS COMBINATIONS - Consideration Paid (Details) - USD ($) $ in Thousands			9 Months Ended
	May 26, 2021	Apr. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Consideration Paid [Abstract]
Cash payments to common shareholders			$ 0	$ 32,991
Savoy Bank
Consideration Paid [Abstract]
Common stock issued (1,357,567 shares issued)	$ 31,252
Rollover Options	1,269
Cash payments to common shareholders	32,991
Total consideration paid	$ 65,512
Business Combination [Abstract]
Goodwill deductible for income tax purposes			$ 0
Savoy Bank \| Common Stock
Consideration Paid [Abstract]
Total consideration paid		$ 65,500
Business Combination [Abstract]
Common stock issued as part of consideration (in shares)	1,357,567

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

EARNINGS PER COMMON SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended						9 Months Ended
	Jun. 30, 2022	Mar. 31, 2022	Dec. 31, 2021	Jun. 30, 2021	Mar. 31, 2021	Dec. 31, 2020	Jun. 30, 2022	Jun. 30, 2021
EARNINGS PER COMMON SHARE
Antidilutive stock options (in shares)	0			0			0	0
Earnings Per Share, Basic [Abstract]
Net income	$ 5,333	$ 5,860	$ 6,537	$ 221	$ 2,055	$ 1,519	$ 17,730	$ 3,795
Weighted average common shares outstanding (in shares)	6,596,505			4,731,949			5,970,288	4,368,809
Basic earnings per common share (in dollars per share)	$ 0.81			$ 0.05			$ 2.97	$ 0.87
Earnings Per Share, Diluted [Abstract]
Net income	$ 5,333	$ 5,860	$ 6,537	$ 221	$ 2,055	$ 1,519	$ 17,730	$ 3,795
Weighted average common shares outstanding for basic earnings per common share (in shares)	6,596,505			4,731,949			5,970,288	4,368,809
Add: dilutive effects of assumed exercises of stock options (in shares)	99,062			84,311			99,206	84,129
Average shares and dilutive potential common shares (in shares)	6,695,567			4,816,260			6,069,494	4,452,938
Diluted earnings per common share (in dollars per share)	$ 0.80			$ 0.05			$ 2.92	$ 0.85

SECURITIES - Investment Securities Available for Sale and Held to Maturity (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Sep. 30, 2021
Available for sale [Abstract]
Amortized cost	$ 7,090	$ 7,422
Gross unrealized gains		326
Gross unrealized losses	(350)	(1)
Fair value	6,740	7,747
Held to maturity [Abstract]
Amortized cost	4,509	8,611
Gross unrealized gains		258
Gross unrealized losses	(200)	(4)
Fair value	4,309	8,865
Investment Securities [Abstract]
Amortized cost	11,599	16,033
Gross unrealized gains		584
Gross unrealized losses	(550)	(5)
Fair value	11,049	16,612
Gross unrealized losses in a continuous loss position for less than twelve months	550	5
Investment securities pledged to secure public deposits	1,800	5,100
U.S. GSE residential mortgage-backed securities
Available for sale [Abstract]
Amortized cost	390	722
Gross unrealized gains		112
Gross unrealized losses	(71)	(1)
Fair value	319	833
Held to maturity [Abstract]
Amortized cost	1,858	2,417
Gross unrealized gains		74
Gross unrealized losses	(117)	0
Fair value	1,741	2,491
U.S. GSE commercial mortgage-backed securities
Held to maturity [Abstract]
Amortized cost	2,651	2,694
Gross unrealized gains		175
Gross unrealized losses	(83)	0
Fair value	2,568	2,869
Corporate Bonds
Available for sale [Abstract]
Amortized cost	6,700	6,700
Gross unrealized gains		214
Gross unrealized losses	(279)	0
Fair value	$ 6,421	6,914
Held to maturity [Abstract]
Amortized cost		3,500
Gross unrealized gains		9
Gross unrealized losses		(4)
Fair value		$ 3,505

SECURITIES - Securities Portfolio Presented by Contractual Maturity (Details) - USD ($)	3 Months Ended	9 Months Ended
	Jun. 30, 2022	Jun. 30, 2022	Jun. 30, 2021	Sep. 30, 2021
Securities Available for Sale, Amortized Cost [Abstract]
Five to ten years	$ 6,700,000	$ 6,700,000
Amortized cost	7,090,000	7,090,000		$ 7,422,000
Securities Available for Sale, Fair Value [Abstract]
Five to ten years	6,421,000	6,421,000
Fair value	6,740,000	6,740,000		7,747,000
Securities Held to Maturity, Amortized Cost [Abstract]
One to five years	0	0
Five to ten years	0	0
Amortized cost	4,509,000	4,509,000		8,611,000
Securities Held to Maturity, Fair Value [Abstract]
One to five years	0	0
Five to ten years	0	0
Fair value	4,309,000	4,309,000		8,865,000
Debt Securities, Available-for-Sale and Held-to-Maturity, after Allowance for Credit Loss [Abstract]
Amortized cost	11,599,000	11,599,000		16,033,000
Fair value	11,049,000	11,049,000		16,612,000
Proceeds from sales		2,105,000	$ 3,240,000
Gain on sale of securities available for sale		105,000	$ 240,000
Sales of securities	0	0
U.S. GSE residential mortgage-backed securities
Securities Available for Sale, Amortized Cost [Abstract]
Amortized cost	390,000	390,000		722,000
Securities Available for Sale, Fair Value [Abstract]
Fair value	319,000	319,000		833,000
Securities Held to Maturity, Amortized Cost [Abstract]
Without single maturity date	1,858,000	1,858,000
Amortized cost	1,858,000	1,858,000		2,417,000
Securities Held to Maturity, Fair Value [Abstract]
Without single maturity date	1,741,000	1,741,000
Fair value	1,741,000	1,741,000		2,491,000
U.S. GSE commercial mortgage-backed securities
Securities Available for Sale, Amortized Cost [Abstract]
Without single maturity date	390,000	390,000
Securities Available for Sale, Fair Value [Abstract]
Without single maturity date	319,000	319,000
Securities Held to Maturity, Amortized Cost [Abstract]
Without single maturity date	2,651,000	2,651,000
Amortized cost	2,651,000	2,651,000		2,694,000
Securities Held to Maturity, Fair Value [Abstract]
Without single maturity date	2,568,000	2,568,000
Fair value	$ 2,568,000	$ 2,568,000		$ 2,869,000

LOANS - Classification of Loans (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021	Sep. 30, 2021	Dec. 31, 2020	Sep. 30, 2020
Classification of Loans by Loan Portfolio Segment [Abstract]
Gross loans	$ 1,413,888		$ 1,413,888			$ 1,246,605
Net deferred costs (fees)	(1,889)		(1,889)			(520)
Total loans	1,415,777		1,415,777			1,247,125
Allowance for loan losses	(10,886)	$ (7,852)	(10,886)	$ (7,852)	$ (9,886)	(8,552)	$ (8,179)	$ (7,869)
Loans held for investment, net	1,404,891		1,404,891			1,238,573
Servicing of loans to others	233,200		233,200
Loans held for sale	0		0			0
Amount from sale of loans	9,500	13,500	60,900	31,300
Recognized net gains amount	$ 849	212	$ 3,916	688
PPP Loans
Classification of Loans by Loan Portfolio Segment [Abstract]
Interest rate	1.00%		1.00%
Amount of loans forgiven	$ 345,700		$ 345,700
PPP Loans \| Maximum
Classification of Loans by Loan Portfolio Segment [Abstract]
Loan term			5 years
Extension to loan term			5 years
PPP Loans \| Minimum
Classification of Loans by Loan Portfolio Segment [Abstract]
Loan term			2 years
Residential real estate
Classification of Loans by Loan Portfolio Segment [Abstract]
Gross loans	431,409		$ 431,409			444,011
Total loans	431,848		431,848			444,140
Allowance for loan losses	(3,232)	(4,375)	(3,232)	(4,375)	(3,400)	(4,155)	(4,851)	(5,103)
Multi-family
Classification of Loans by Loan Portfolio Segment [Abstract]
Gross loans	478,756		478,756			266,294
Total loans	479,366		479,366			266,714
Allowance for loan losses	(3,130)	(1,900)	(3,130)	(1,900)	(2,627)	(2,433)	(1,955)	(1,506)
Commercial real estate
Classification of Loans by Loan Portfolio Segment [Abstract]
Gross loans	429,953		429,953			348,641
Total loans	430,364		430,364			348,807
Allowance for loan losses	(3,806)	(1,509)	(3,806)	(1,509)	(3,327)	(1,884)	(1,310)	(1,221)
Commercial and industrial
Classification of Loans by Loan Portfolio Segment [Abstract]
Gross loans	56,544		56,544			172,274
Total loans	56,932		56,932			172,077
Allowance for loan losses	(635)	(67)	(635)	(67)	$ (532)	(79)	(62)	(38)
Commercial and industrial \| PPP Loans
Classification of Loans by Loan Portfolio Segment [Abstract]
Gross loans	20,400		20,400			140,400
Construction and land development
Classification of Loans by Loan Portfolio Segment [Abstract]
Gross loans	17,214		17,214			15,374
Total loans	17,254		17,254			15,374
Allowance for loan losses	(82)		(82)			0
Consumer
Classification of Loans by Loan Portfolio Segment [Abstract]
Gross loans	12		12			11
Total loans	13		13			13
Allowance for loan losses	$ (1)	$ (1)	$ (1)	$ (1)		$ (1)	$ (1)	$ (1)

LOANS - Carrying Amount for Purchased Credit Impaired Loans (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Sep. 30, 2021
Carrying Amount for Purchased Credit Impaired Loans [Abstract]
Total recorded investment	$ 1,237	$ 10,241
Commercial Real Estate [Member]
Carrying Amount for Purchased Credit Impaired Loans [Abstract]
Total recorded investment	595	8,324
Commercial and Industrial [Member]
Carrying Amount for Purchased Credit Impaired Loans [Abstract]
Total recorded investment	$ 642	$ 1,917

LOANS - Changes in Accretable Difference on Purchased Loans (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Jun. 30, 2022	Jun. 30, 2022
Changes in Accretable Difference on Purchased Loans [Abstract]
Balance at beginning of period	$ 88	$ 346
Accretable differences acquired		0
Accretion	(16)	(1,799)
Adjustments to accretable difference due to changes in expected cash flows		(381)
Other changes, net		1,906
Ending balance	$ 72	$ 72

LOANS - Activity in Allowance for Loan Losses by Portfolio Segment (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Allowance for loan losses by portfolio segment [Roll Forward]
Beginning balance			$ 8,552	$ 7,869
Charge-offs		$ (328)	(66)	(328)
Recoveries		1		11
Provision (credit) for loan losses	$ 1,000		2,400	300
Ending balance	10,886	7,852	10,886	7,852
Residential Real Estate [Member]
Allowance for loan losses by portfolio segment [Roll Forward]
Beginning balance			4,155	5,103
Charge-offs		(267)		(267)
Provision (credit) for loan losses	(168)	(209)	(923)	(461)
Ending balance	3,232	4,375	3,232	4,375
Multi-family
Allowance for loan losses by portfolio segment [Roll Forward]
Beginning balance			2,433	1,506
Charge-offs		(32)	(66)	(32)
Provision (credit) for loan losses	503	(23)	763	426
Ending balance	3,130	1,900	3,130	1,900
Commercial Real Estate [Member]
Allowance for loan losses by portfolio segment [Roll Forward]
Beginning balance			1,884	1,221
Charge-offs		(29)		(29)
Provision (credit) for loan losses	479	228	1,922	317
Ending balance	3,806	1,509	3,806	1,509
Commercial and Industrial [Member]
Allowance for loan losses by portfolio segment [Roll Forward]
Beginning balance			79	38
Recoveries		1		11
Provision (credit) for loan losses	103	4	556	18
Ending balance	635	67	635	67
Construction [Member]
Allowance for loan losses by portfolio segment [Roll Forward]
Beginning balance			0
Provision (credit) for loan losses	82		82
Ending balance	82		82
Consumer [Member]
Allowance for loan losses by portfolio segment [Roll Forward]
Beginning balance			1	1
Provision (credit) for loan losses	1
Ending balance	$ 1	$ 1	$ 1	$ 1

LOANS - Allowance for Loan Losses, Allowance for Loan Losses and Recorded Investment by Portfolio Segment Based on Impairment Method (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021	Sep. 30, 2021	Jun. 30, 2021	Dec. 31, 2020	Sep. 30, 2020
Allowance for Loan Losses [Abstract]
Individually evaluated for impairment			$ 0
Collectively evaluated for impairment	$ 10,886		8,552
Purchased-credit impaired			0
Total allowance for loan losses	10,886	$ 9,886	8,552	$ 7,852	$ 8,179	$ 7,869
Loans [Abstract]
Individually evaluated for impairment	13,819		8,673
Collectively evaluated for impairment	1,400,721		1,228,211
Purchased-credit impaired	1,237		10,241
Total loans	1,415,777		1,247,125
Residential Real Estate [Member]
Allowance for Loan Losses [Abstract]
Individually evaluated for impairment			0
Collectively evaluated for impairment	3,232		4,155
Purchased-credit impaired			0
Total allowance for loan losses	3,232	3,400	4,155	4,375	4,851	5,103
Loans [Abstract]
Individually evaluated for impairment	5,427		7,198
Collectively evaluated for impairment	426,421		436,942
Purchased-credit impaired	0		0
Total loans	431,848		444,140
Multi-family
Allowance for Loan Losses [Abstract]
Individually evaluated for impairment			0
Collectively evaluated for impairment	3,130		2,433
Purchased-credit impaired			0
Total allowance for loan losses	3,130	2,627	2,433	1,900	1,955	1,506
Loans [Abstract]
Individually evaluated for impairment	2,343		458
Collectively evaluated for impairment	477,023		266,256
Purchased-credit impaired	0		0
Total loans	479,366		266,714
Commercial Real Estate [Member]
Allowance for Loan Losses [Abstract]
Individually evaluated for impairment			0
Collectively evaluated for impairment	3,806		1,884
Purchased-credit impaired			0
Total allowance for loan losses	3,806	3,327	1,884	1,509	1,310	1,221
Loans [Abstract]
Individually evaluated for impairment	5,844		517
Collectively evaluated for impairment	423,925		339,966
Purchased-credit impaired	595		8,324
Total loans	430,364		348,807
Commercial and Industrial [Member]
Allowance for Loan Losses [Abstract]
Individually evaluated for impairment			0
Collectively evaluated for impairment	635		79
Purchased-credit impaired			0
Total allowance for loan losses	635	$ 532	79	67	62	38
Loans [Abstract]
Individually evaluated for impairment	205		500
Collectively evaluated for impairment	56,085		169,660
Purchased-credit impaired	642		1,917
Total loans	56,932		172,077
Construction [Member]
Allowance for Loan Losses [Abstract]
Individually evaluated for impairment			0
Collectively evaluated for impairment	82		0
Purchased-credit impaired			0
Total allowance for loan losses	82		0
Loans [Abstract]
Individually evaluated for impairment			0
Collectively evaluated for impairment	17,254		15,374
Purchased-credit impaired	0		0
Total loans	17,254		15,374
Consumer [Member]
Allowance for Loan Losses [Abstract]
Individually evaluated for impairment			0
Collectively evaluated for impairment	1		1
Purchased-credit impaired			0
Total allowance for loan losses	1		1	$ 1	$ 1	$ 1
Loans [Abstract]
Individually evaluated for impairment			0
Collectively evaluated for impairment	13		13
Purchased-credit impaired	0		0
Total loans	$ 13		$ 13

LOANS - Impaired Loans (Details) - USD ($)
$ in Thousands

3 Months Ended

9 Months Ended

Jun. 30, 2022

Jun. 30, 2021

Jun. 30, 2022

Jun. 30, 2021

Sep. 30, 2021

Unpaid principal balance

$ 13,664

$ 8,821

Recorded investment

13,819

8,673

Average recorded investment and interest income recognized [Abstract]

Average recorded investment

12,150

$ 6,482

8,124

$ 5,116

Interest income recognized

^[1]

Residential Real Estate [Member]

Unpaid principal balance

5,358

7,382

Recorded investment

5,427

7,198

Average recorded investment and interest income recognized [Abstract]

Average recorded investment

5,034

5,937

4,400

4,890

Interest income recognized

^[1]

Multi-family

Unpaid principal balance

2,264

382

Recorded investment

2,343

458

Average recorded investment and interest income recognized [Abstract]

Average recorded investment

1,058

171

641

Interest income recognized

Commercial Real Estate [Member]

Unpaid principal balance

5,822

522

Recorded investment

5,844

517

Average recorded investment and interest income recognized [Abstract]

Average recorded investment

5,851

193

2,883

Interest income recognized

Commercial and industrial

Unpaid principal balance

220

535

Recorded investment

205

$ 500

Average recorded investment and interest income recognized [Abstract]

Average recorded investment

$ 207

$ 181

$ 200

$ 60

[1]	Accrual basis interest income recognized approximates cash basis income.

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

Jun. 30, 2022

Sep. 30, 2021

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

Non-accrual

$ 12,491

$ 7,028

Purchased credit impaired loans

1,237

10,241

Total past due and non-accrual

16,627

15,241

Total

1,415,777

1,247,125

30-59 Days Past Due [Member]

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

Recorded total loans

1,928

6,612

60-89 Days Past Due [Member]

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

Recorded total loans

2,208

1,601

Greater than 89 Days Past Due [Member]

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

Recorded total loans

Current [Member]

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

Recorded total loans

1,397,913

1,221,643

Residential real estate

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

Non-accrual

4,099

^[1]

5,554

^[2]

Purchased credit impaired loans

Total past due and non-accrual

6,027

8,187

Total

431,848

444,140

Residential real estate | 30-59 Days Past Due [Member]

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

Recorded total loans

1,928

1,032

Residential real estate | 60-89 Days Past Due [Member]

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

Recorded total loans

1,601

Non-accrual

1,026

Residential real estate | Greater than 89 Days Past Due [Member]

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

Recorded total loans

Non-accrual

1,915

4,528

Residential real estate | Current [Member]

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

Recorded total loans

425,821

435,953

Non-accrual

2,184

Multi-family

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

Non-accrual

2,342

^[3]

458

^[4]

Purchased credit impaired loans

Total past due and non-accrual

3,572

458

Total

479,366

266,714

Multi-family | 30-59 Days Past Due [Member]

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

Recorded total loans

Multi-family | 60-89 Days Past Due [Member]

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

Recorded total loans

1,230

Multi-family | Greater than 89 Days Past Due [Member]

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

Recorded total loans

Multi-family | Current [Member]

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

Recorded total loans

475,794

266,256

Commercial [Member]

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

Non-accrual

5,844

^[5]

1,016

^[6]

Purchased credit impaired loans

595

8,324

Total past due and non-accrual

5,844

2,955

Total

430,364

348,807

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

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

Recorded total loans

1,939

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

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

Recorded total loans

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

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

Recorded total loans

Commercial [Member] | Current [Member]

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

Recorded total loans

423,925

337,528

Commercial and Industrial [Member]

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

Non-accrual

206

^[7]

Purchased credit impaired loans

642

1,917

Total past due and non-accrual

1,184

3,641

Total

56,932

172,077

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

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

Recorded total loans

3,641

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

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

Recorded total loans

978

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

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

Recorded total loans

Commercial and Industrial [Member] | Current [Member]

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

Recorded total loans

55,106

166,519

Construction [Member]

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

Non-accrual

Purchased credit impaired loans

Total past due and non-accrual

Total

17,254

15,374

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

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

Recorded total loans

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

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

Recorded total loans

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

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

Recorded total loans

Construction [Member] | Current [Member]

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

Recorded total loans

17,254

15,374

Consumer [Member]

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

Non-accrual

Purchased credit impaired loans

Total past due and non-accrual

Total

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

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

Recorded total loans

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

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

Recorded total loans

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

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

Recorded total loans

Consumer [Member] | Current [Member]

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

Recorded total loans

$ 13

[1]	Of the residential real estate non-accrual loans, $2,184 were current and $1,915 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 June 30, 2022 were greater than 89 days past due.
[4]	Multi-family non-accrual loans at September 30, 2021 were greater than 89 days past due.
[5]	Commercial real estate non-accrual loans at June 30, 2022 were greater than 89 days past due.
[6]	Commercial real estate non-accrual loans at September 30, 2021 were greater than 89 days past due.
[7]	Commercial and industrial non-accrual loans at June 30, 2022 were greater than 89 days past due.

LOANS - Troubled Debt Restructurings (Details) $ in Millions	3 Months Ended		9 Months Ended
	Jun. 30, 2022 USD ($) loan	Jun. 30, 2021 loan	Jun. 30, 2022 USD ($) loan	Jun. 30, 2021 loan	Sep. 30, 2021 USD ($)
LOANS
Recorded investment in TDRs	$ 1.3		$ 1.3		$ 1.6
Specific reserves allocated to troubled debt restructurings	0.0		0.0		0.0
Commitments to lend additional funds in troubled debt restructurings	$ 0.0		$ 0.0		$ 0.0
TDR's with subsequent payment default \| loan	0	0	0	0
Threshold period for payment default			90 days
Number of newly added TDRs \| loan	0	0	0	0

LOANS - Loan Portfolio by Credit Risk Rating (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Sep. 30, 2021
Loans Portfolio by Credit Risk Rating [Abstract]
Total	$ 1,413,888	$ 1,246,605
Pass [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	1,381,312	1,194,732
Special Mention [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	15,200	26,548
Substandard [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	17,376	25,322
Doubtful [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	0	3
Residential real estate
Loans Portfolio by Credit Risk Rating [Abstract]
Total	431,409	444,011
Residential real estate \| Pass [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	426,257	433,299
Residential real estate \| Special Mention [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	516	5,115
Residential real estate \| Substandard [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	4,636	5,594
Residential real estate \| Doubtful [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	0	3
Multi-family
Loans Portfolio by Credit Risk Rating [Abstract]
Total	478,756	266,294
Multi-family \| Pass [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	473,592	262,984
Multi-family \| Special Mention [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	2,821	2,852
Multi-family \| Substandard [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	2,343	458
Multi-family \| Doubtful [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	0	0
Commercial [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	429,953	348,641
Commercial [Member] \| Pass [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	412,834	316,727
Commercial [Member] \| Special Mention [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	8,818	16,274
Commercial [Member] \| Substandard [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	8,301	15,640
Commercial [Member] \| Doubtful [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	0	0
Commercial and Industrial [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	56,544	172,274
Commercial and Industrial [Member] \| Pass [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	53,811	168,104
Commercial and Industrial [Member] \| Special Mention [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	637	540
Commercial and Industrial [Member] \| Substandard [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	2,096	3,630
Commercial and Industrial [Member] \| Doubtful [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	0	0
Construction [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	17,214	15,374
Construction [Member] \| Pass [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	14,806	13,607
Construction [Member] \| Special Mention [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	2,408	1,767
Construction [Member] \| Substandard [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	0	0
Construction [Member] \| Doubtful [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	0	0
Consumer [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	12	11
Consumer [Member] \| Pass [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	12	11
Consumer [Member] \| Special Mention [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	0	0
Consumer [Member] \| Substandard [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	0	0
Consumer [Member] \| Doubtful [Member]
Loans Portfolio by Credit Risk Rating [Abstract]
Total	$ 0	$ 0

EQUITY COMPENSATION PLANS - 2021 and 2018 Equity Compensation Plans (Details)	9 Months Ended
	Jun. 30, 2022 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)	274,208
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)	32,802
Stock Options [Member]
Equity Compensation Plans [Abstract]
Number of Savoy options converted (in shares)	71,900

EQUITY COMPENSATION PLANS - Stock Options (Details) - Stock Options [Member] - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended		12 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021	Sep. 30, 2021
Equity Compensation Plans [Abstract]
Award vesting period			3 years
Contractual term			10 years
Compensation expenses	$ 0	$ 0	$ 0	$ 0
Number of Options [Roll Forward]
Outstanding, beginning of period (in shares)			227,406
Granted (in shares)			0
Exercised (in shares)	0	0	0	0
Forfeited (in shares)			0
Outstanding, end of period (in shares)	227,406		227,406		227,406
Weighted-Average Exercise Price Per Share [Roll Forward]
Outstanding, beginning of period (in dollars per share)			$ 9.50
Granted (in dollars per share)			0
Exercised (in dollars per share)			0
Forfeited (in dollars per share)			0
Outstanding, end of period (in dollars per share)	$ 9.50		$ 9.50		$ 9.50
Aggregate Intrinsic Value [Abstract]
Aggregate intrinsic value, outstanding	$ 2,400		$ 2,400		$ 2,043
Weighted Average Remaining Contractual Term [Abstract]
Weighted-average remaining contractual term, outstanding			2 years 8 months 12 days		3 years 6 months 3 days

EQUITY COMPENSATION PLANS - Restricted Stock (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Restricted Stock [Member]
Number of Shares [Roll Forward]
Unvested, beginning of period (in shares)			75,833
Granted (in shares)			275,430
Vested (in shares)			(41,504)
Forfeited (in shares)			(10,189)
Unvested, end of period (in shares)	299,570		299,570
Weighted-Average Grant Date Fair Value [Roll Forward]
Unvested, beginning of period (in dollars per share)			$ 19.87
Granted (in dollars per share)			19.73
Vested (in dollars per share)			19.77
Forfeited (in dollars per share)			19.47
Unvested, end of period (in dollars per share)	$ 19.77		$ 19.77
Compensation expenses	$ 482	$ 224	$ 1,100	$ 669
Unrealized compensation cost	$ 5,300		$ 5,300
Weighted-average term for recognizing unrealized compensation cost			4 years 1 month 13 days
Total fair value of shares vested			$ 824	$ 868
Restricted Stock [Member] \| Three-year Vesting Period [Member]
Restricted Stock [Abstract]
Award vesting period			3 years
Number of Shares [Roll Forward]
Granted (in shares)			44,642
Restricted Stock [Member] \| Five-year vesting period [Member]
Restricted Stock [Abstract]
Award vesting period			5 years
Number of Shares [Roll Forward]
Granted (in shares)			230,788
Restricted Stock Units (RSUs) [Member]
Restricted Stock [Abstract]
Award vesting period			3 years
Number of Shares [Roll Forward]
Unvested, beginning of period (in shares)			0
Granted (in shares)			51,097	0
Vested (in shares)			0
Forfeited (in shares)			0
Unvested, end of period (in shares)	51,097		51,097
Weighted-Average Grant Date Fair Value [Roll Forward]
Unvested, beginning of period (in dollars per share)			$ 0
Granted (in dollars per share)			19.73
Vested (in dollars per share)			0
Forfeited (in dollars per share)			0
Unvested, end of period (in dollars per share)	$ 19.73		$ 19.73
Compensation expenses	$ 82	$ 0	$ 139	$ 0
Unrealized compensation cost	$ 869		$ 869
Weighted-average term for recognizing unrealized compensation cost			2 years 8 months 12 days

REGULATORY MATTERS (Details) $ in Thousands	9 Months Ended
REGULATORY MATTERS (Details) $ in Thousands	Jun. 30, 2022 USD ($)	Sep. 30, 2021 USD ($)
Total capital to risk-weighted assets [Abstract]
Actual capital, Amount	$ 182,811	$ 132,554
Actual capital, Ratio	0.1732	0.1559
Minimum capital adequacy requirement, Amount	$ 84,444	$ 68,040
Minimum capital adequacy requirement, Ratio	0.0800	0.0800
Minimum capital adequacy requirement with capital conservation buffer, Amount	$ 110,833	$ 89,303
Minimum capital adequacy requirement with capital conservation buffer, Ratio	0.1050	0.1050
Minimum to be well capitalized under prompt corrective action provisions, Amount	$ 105,555	$ 85,050
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	$ 171,753	$ 123,666
Actual capital, Ratio	0.1627	0.1454
Minimum capital adequacy requirement, Amount	$ 63,333	$ 51,030
Minimum capital adequacy requirement, Ratio	0.0600	0.0600
Minimum capital adequacy requirement with capital conservation buffer, Amount	$ 89,722	$ 72,293
Minimum capital adequacy requirement with capital conservation buffer, Ratio	0.0850	0.0850
Minimum to be well capitalized under prompt corrective action provisions, Amount	$ 84,444	$ 68,040
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	$ 171,753	$ 123,666
Actual capital, Ratio	0.1627	0.1454
Minimum capital adequacy requirement, Amount	$ 47,500	$ 38,273
Minimum capital adequacy requirement, Ratio	0.0450	0.0450
Minimum capital adequacy requirement with capital conservation buffer, Amount	$ 73,889	$ 59,535
Minimum capital adequacy requirement with capital conservation buffer, Ratio	0.0700	0.0700
Minimum to be well capitalized under prompt corrective action provisions, Amount	$ 68,611	$ 55,283
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	$ 171,753	$ 123,666
Actual capital, Ratio	0.1164	0.0945
Minimum capital adequacy requirement, Amount	$ 59,007	$ 52,338
Minimum capital adequacy requirement, Ratio	0.0400	0.0400
Minimum to be well capitalized under prompt corrective action provisions, Amount	$ 73,759	$ 65,423
Minimum to be well capitalized under prompt corrective action provisions, Ratio	0.0500	0.0500
Retained earnings available to pay dividends	$ 46,600

FAIR VALUE - Assets Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Sep. 30, 2021
Financial Assets [Abstract]
Available for sale, at fair value	$ 6,740	$ 7,747
Mortgage servicing rights	4,120	3,690
U.S. GSE residential mortgage-backed securities
Financial Assets [Abstract]
Available for sale, at fair value	319	833
Corporate Bonds
Financial Assets [Abstract]
Available for sale, at fair value	6,421	6,914
Recurring [Member]
Financial Assets [Abstract]
Total	10,860	11,437
Recurring [Member] \| U.S. GSE residential mortgage-backed securities
Financial Assets [Abstract]
Available for sale, at fair value	319	833
Recurring [Member] \| Corporate Bonds
Financial Assets [Abstract]
Available for sale, at fair value	6,421	6,914
Recurring [Member] \| Mortgage Servicing Rights [Member]
Financial Assets [Abstract]
Mortgage servicing rights	4,120	3,690
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 residential mortgage-backed securities
Financial Assets [Abstract]
Available for sale, at fair value	0	0
Recurring [Member] \| Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] \| Corporate Bonds
Financial Assets [Abstract]
Available for sale, at fair value	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	6,740	7,747
Recurring [Member] \| Significant Other Observable Inputs (Level 2) [Member] \| U.S. GSE residential mortgage-backed securities
Financial Assets [Abstract]
Available for sale, at fair value	319	833
Recurring [Member] \| Significant Other Observable Inputs (Level 2) [Member] \| Corporate Bonds
Financial Assets [Abstract]
Available for sale, at fair value	6,421	6,914
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	4,120	3,690
Recurring [Member] \| Significant Unobservable Inputs (Level 3) [Member] \| U.S. GSE residential mortgage-backed securities
Financial Assets [Abstract]
Available for sale, at fair value	0	0
Recurring [Member] \| Significant Unobservable Inputs (Level 3) [Member] \| Corporate Bonds
Financial Assets [Abstract]
Available for sale, at fair value	0	0
Recurring [Member] \| Significant Unobservable Inputs (Level 3) [Member] \| Mortgage Servicing Rights [Member]
Financial Assets [Abstract]
Mortgage servicing rights	$ 4,120	$ 3,690

FAIR VALUE - Significant Inputs Utilized in Cash Flow Models (Details) $ in Thousands	9 Months Ended	12 Months Ended
	Jun. 30, 2022 USD ($)	Sep. 30, 2021 USD ($)
Fair Value Hierarchy [Abstract]
Servicing rights, valuation technique [Extensible List]	us-gaap:ValuationTechniqueDiscountedCashFlowMember	us-gaap:ValuationTechniqueDiscountedCashFlowMember
Nonrecurring [Member]
Fair Value Hierarchy [Abstract]
Financial instruments measured at fair value	$ 0	$ 0
Impaired loans, related specific allowance	$ 0	$ 0
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
Fair Value Hierarchy [Abstract]
Servicing rights, measurement input	0.120	0.120
Significant Unobservable Inputs (Level 3) [Member] \| Discount Rate [Member] \| Minimum \| SBA Loans [Member]
Fair Value Hierarchy [Abstract]
Servicing rights, measurement input	0.0486
Significant Unobservable Inputs (Level 3) [Member] \| Discount Rate [Member] \| Maximum
Fair Value Hierarchy [Abstract]
Servicing rights, measurement input	0.145	0.145
Significant Unobservable Inputs (Level 3) [Member] \| Discount Rate [Member] \| Maximum \| SBA Loans [Member]
Fair Value Hierarchy [Abstract]
Servicing rights, measurement input	0.2304
Significant Unobservable Inputs (Level 3) [Member] \| Prepayment Rate [Member]
Fair Value Hierarchy [Abstract]
Servicing rights, measurement input	0.2625
Significant Unobservable Inputs (Level 3) [Member] \| Prepayment Rate [Member] \| Minimum
Fair Value Hierarchy [Abstract]
Servicing rights, measurement input		0.2418
Significant Unobservable Inputs (Level 3) [Member] \| Prepayment Rate [Member] \| Minimum \| SBA Loans [Member]
Fair Value Hierarchy [Abstract]
Servicing rights, measurement input	0.0920
Significant Unobservable Inputs (Level 3) [Member] \| Prepayment Rate [Member] \| Maximum
Fair Value Hierarchy [Abstract]
Servicing rights, measurement input		0.2433
Significant Unobservable Inputs (Level 3) [Member] \| Prepayment Rate [Member] \| Maximum \| SBA Loans [Member]
Fair Value Hierarchy [Abstract]
Servicing rights, measurement input	0.2584
Significant Unobservable Inputs (Level 3) [Member] \| Weighted Average Life [Member] \| Minimum
Fair Value Hierarchy [Abstract]
Servicing rights, measurement input	1 year 3 months 14 days	1 year 11 months 15 days
Significant Unobservable Inputs (Level 3) [Member] \| Weighted Average Life [Member] \| Minimum \| SBA Loans [Member]
Fair Value Hierarchy [Abstract]
Servicing rights, measurement input	14 days
Significant Unobservable Inputs (Level 3) [Member] \| Weighted Average Life [Member] \| Maximum
Fair Value Hierarchy [Abstract]
Servicing rights, measurement input	3 years 10 days	3 years 3 months 18 days
Significant Unobservable Inputs (Level 3) [Member] \| Weighted Average Life [Member] \| Maximum \| SBA Loans [Member]
Fair Value Hierarchy [Abstract]
Servicing rights, measurement input	5 years 9 months 29 days

FAIR VALUE - Changes in Mortgage Servicing Rights (Details) - Mortgage Servicing Rights [Member] - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Changes in Mortgage Servicing Rights [Roll Forward]
Beginning balance	$ 4,028	$ 130	$ 3,690	$ 155
Additions	211	3,776	784	3,776
Adjustment to fair value	(119)	(91)	(354)	(116)
Ending balance	$ 4,120	$ 3,815	$ 4,120	$ 3,815

FAIR VALUE - Carrying Amount and Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Sep. 30, 2021
Carrying Amount [Member]
Financial Assets [Abstract]
Cash and cash equivalents	$ 133,974	$ 166,544
Securities held to maturity	4,509	8,611
Securities available-for-sale	6,740	7,747
Federal Home Loan Bank stock	3,858	3,714
Loans, net	1,404,891	1,238,573
Accrued interest receivable	7,643	9,363
Financial Liabilities [Abstract]
Time deposits	298,272	377,836
Demand and other deposits	1,051,277	786,826
Borrowings	56,963	159,642
Subordinated debentures	24,554	24,513
Accrued interest payable	611	1,290
As Adjusted
Financial Assets [Abstract]
Cash and cash equivalents	133,974	166,544
Securities held to maturity	4,309	8,865
Securities available-for-sale	6,740	7,747
Loans, net	1,379,005	1,278,056
Accrued interest receivable	7,643	9,363
Financial Liabilities [Abstract]
Time deposits	291,890	378,333
Demand and other deposits	1,051,277	786,826
Borrowings	57,192	159,608
Subordinated debentures	24,698	27,092
Accrued interest payable	611	1,290
As Adjusted \| Quoted Prices in Active Markets for Identical Assets (Level 1) [Member]
Financial Assets [Abstract]
Cash and cash equivalents	133,974	166,544
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	1,051,277	786,826
Borrowings	0	0
Subordinated debentures	0	0
Accrued interest payable	1	1
As Adjusted \| Significant Other Observable Inputs (Level 2) [Member]
Financial Assets [Abstract]
Cash and cash equivalents	0	0
Securities held to maturity	4,309	8,865
Securities available-for-sale	6,740	7,747
Loans, net	0	0
Accrued interest receivable	117	211
Financial Liabilities [Abstract]
Time deposits	291,890	378,333
Demand and other deposits	0	0
Borrowings	57,192	159,608
Subordinated debentures	24,698	27,092
Accrued interest payable	610	713
As Adjusted \| 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	1,379,005	1,278,056
Accrued interest receivable	7,526	9,152
Financial Liabilities [Abstract]
Time deposits	0	0
Demand and other deposits	0	0
Borrowings	0	0
Subordinated debentures	0	0
Accrued interest payable	$ 0	$ 576

BORROWINGS (Details) - USD ($)	1 Months Ended	9 Months Ended
BORROWINGS (Details) - USD ($)	Oct. 31, 2020	Jun. 30, 2022	Sep. 30, 2021
Contractual Maturities of FHLB Advances [Abstract]
2023/2022		$ 11,905,000	$ 4,000,000
2024/2023		18,860,000	12,040,000
2025/2024		7,080,000	18,860,000
2025			7,080,000
FHLB advances		$ 37,845,000	$ 41,980,000
Weighted Average Interest Rates of FHLB Advances [Abstract]
2023/2022		2.23%	2.02%
2024/2023		0.98%	2.23%
2025/2024		0.58%	0.98%
2025			0.58%
Weighted average rate		1.30%	1.37%
Borrowings [Abstract]
Additional eligible borrowings from FHLB		$ 183,300,000
Short-term Debt		56,963,000	$ 159,642,000
Subordinated Notes [Member]
Borrowings [Abstract]
Unamortized debt issuance costs		$ 400,000	$ 500,000
Federal Home Loan Bank Advances
Borrowings [Abstract]
Maturity date, earliest		2023	2021
Maturity date, last		2025	2025
Unsecured Debt [Member]
Borrowings [Abstract]
Line of credit available for borrowing		$ 55,000,000
Borrowings outstanding		$ 250,000	$ 0
Private Placement [Member] \| Subordinated Notes [Member]
Borrowings [Abstract]
Aggregate principal amount	$ 25,000,000.0
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
Minimum
Borrowings [Abstract]
FHLB Interest rate		0.37%
Maximum
Borrowings [Abstract]
FHLB Interest rate		2.96%
PPPLF [Member]
Borrowings [Abstract]
Short-term Debt		$ 18,900,000	$ 117,700,000
Borrowing rate of interest		0.35%	0.35%
PPP Loans [Member] \| Minimum
Borrowings [Abstract]
Debt instrument, term		2 years
PPP Loans [Member] \| Maximum
Borrowings [Abstract]
Debt instrument, term		5 years
Residential and Commercial Mortgage Loans [Member]
Borrowings [Abstract]
Amount of collateral pledged		$ 673,500,000	$ 432,700,000

SUBORDINATED DEBENTURES (Details) - Subordinated Notes [Member] - USD ($) $ in Thousands	1 Months Ended	3 Months Ended		9 Months Ended
	Oct. 31, 2020	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021	Sep. 30, 2021
Debt Instruments [Abstract]
Unamortized issuance costs		$ 400		$ 400		$ 500
Issuance costs		$ 21	$ 16	$ 64	$ 43
Private Placement [Member]
Debt Instruments [Abstract]
Aggregate principal amount	$ 25,000
Debt instrument, maturity date	Dec. 31, 2030
Private Placement [Member] \| Until October 15, 2025 [Member]
Debt Instruments [Abstract]
Borrowing rate of interest	5.00%
Private Placement [Member] \| From and Including October 15, 2025 [Member] \| Secured Overnight Financing Rate [Member]
Debt Instruments [Abstract]
Basis spread on variable rate				4.874%
Term of variable rate				3 months

ACCUMULATED OTHER COMPREHENSIVE INCOME - Changes in Accumulated Other Comprehensive Income by Component, Net of Tax (Details) - USD ($) $ in Thousands	3 Months Ended						9 Months Ended
	Jun. 30, 2022	Mar. 31, 2022	Dec. 31, 2021	Jun. 30, 2021	Mar. 31, 2021	Dec. 31, 2020	Jun. 30, 2022	Jun. 30, 2021
Changes in Other Comprehensive Income by Component, Net of Tax [Roll Forward]
Balance	$ 134,768	$ 129,379	$ 122,529	$ 82,245	$ 80,024	$ 78,043	$ 122,529	$ 78,043
Net current period other comprehensive income (loss)	(241)	(345)	54	27	(97)	167	(532)	97
Balance	167,391	134,768	129,379	115,238	82,245	80,024	167,391	115,238
Accumulated Other Comprehensive Income [Member]
Changes in Other Comprehensive Income by Component, Net of Tax [Roll Forward]
Balance	(35)	310	256	226	323	156	256	156
Net current period other comprehensive income (loss)	(241)	(345)	54	27	(97)	167
Balance	(276)	$ (35)	310	253	$ 226	323	(276)	253
Unrealized Gains and Losses on Available-for-Sale Debt Securities
Changes in Other Comprehensive Income by Component, Net of Tax [Roll Forward]
Balance			$ 256			$ 156	256	156
Other comprehensive income (loss)							(451)	288
Amount reclassified from accumulated other comprehensive income							(81)	(191)
Net current period other comprehensive income (loss)							(532)	97
Balance	$ (276)			$ 253			$ (276)	$ 253

- Definition

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.

+ References

Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(g)(1)(ii))
-URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

Reference 2: http://www.xbrl.org/2003/role/exampleRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 852
-SubTopic 10
-Section 55
-Paragraph 10
-URI http://asc.fasb.org/extlink&oid=84165509&loc=d3e56426-112766

Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 310
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 4.E)
-URI http://asc.fasb.org/extlink&oid=122038336&loc=d3e74512-122707

Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(31))
-URI http://asc.fasb.org/extlink&oid=120391452&loc=d3e13212-122682

Reference 5: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(29))
-URI http://asc.fasb.org/extlink&oid=120391452&loc=d3e13212-122682

Reference 6: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(30))
-URI http://asc.fasb.org/extlink&oid=120391452&loc=d3e13212-122682

Reference 7: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 825
-SubTopic 10
-Section 50
-Paragraph 28
-Subparagraph (f)
-URI http://asc.fasb.org/extlink&oid=123596393&loc=d3e14064-108612

Reference 8: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 323
-SubTopic 10
-Section 50
-Paragraph 3
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=114001798&loc=d3e33918-111571

+ Details

ACCUMULATED OTHER COMPREHENSIVE INCOME - Reclassification Out of Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Significant amounts reclassified out of accumulated other comprehensive income [Abstract]
Realized gains on securities available-for-sale			$ 105	$ 240
Tax effect	$ (1,585)	$ (145)	(5,227)	(1,063)
Unrealized Gains and Losses on Available-for-Sale Debt Securities
Significant amounts reclassified out of accumulated other comprehensive income [Abstract]
Net of tax			81	191
Amount Reclassified from Accumulated Other Comprehensive Income [Member] \| Unrealized Gains and Losses on Available-for-Sale Debt Securities
Significant amounts reclassified out of accumulated other comprehensive income [Abstract]
Realized gains on securities available-for-sale			105	240
Tax effect			(24)	(49)
Net of tax			$ 81	$ 191

- Definition

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

+ References + Details