Loans Receivable

9 Months Ended

Mar. 31, 2026

3. Loans Receivable

Loans receivable are summarized as follows:

	March 31, 2026			June 30, 2025
	(In Thousands)
Loans Secured by Mortgages on Real Estate
One-to-Four Family Residential	$	168,590		$	174,978
Commercial		141,409			138,920
Multi-Family Residential		30,801			32,283
Land		55,434			30,054
Construction		6,166			11,226
Equity and Second Mortgage		2,913			2,520
Equity Lines of Credit		21,367			20,354

Total Mortgage Loans		426,680			410,335

Commercial Loans		56,355			54,138
Consumer Loans
Loans on Savings Accounts		450			381
Other Consumer Loans		285			739

Total Consumer Loans		735			1,120
Total Loans		483,770			465,593

Less: Allowance for Credit Losses		(4,750	)		(4,484	)
Unamortized Loan Fees		(95	)		(105	)

Net Loans Receivable	$	478,925		$	461,004

Credit Quality Indicators

The Company segregates loans into risk categories based on the pertinent information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. The Company analyzes loans individually by classifying the loans according to credit risk. Loans classified as substandard or identified as special mention are reviewed quarterly by management to evaluate the level of deterioration, improvement, and impairment, if any, as well as assign the appropriate risk category.

Loans excluded from the scope of the quarterly review process above are generally identified as pass credits until: (a) they become past due; (b) management becomes aware of a deterioration in the credit worthiness of the borrower; or (c) the customer contacts the Company for a modification. In these circumstances, the loan is specifically evaluated for potential classification and the need to allocate reserves or charge-off.

The Company uses the following definitions for risk ratings:

•

Pass - Loans classified as pass are well protected by the current net worth or paying capacity of the obligor or by the fair value, less cost to acquire and sell the underlying collateral in a timely manner.

•

Pass Watch - Loans are considered marginal, meaning some weakness has been identified which could cause future impairment of repayment. However, these relationships are currently protected from any apparent loss by collateral and are still considered a pass.

•

Special Mention - Loans identified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the bank’s credit position at some future date.

•

Substandard - Loans classified as substandard are inadequately protected by the current net worth and payment capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

•

Doubtful - Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

•

Loss - This classification includes those loans which are considered uncollectible and of such little value that their continuance as loans is not warranted. Even though partial recovery may be possible in the future, it is not practical or desirable to defer writing off these basically worthless loans. Accordingly, these loans are charged-off before period end.

The following tables summarize designated internal risk categories by portfolio segment and loan class, by origination year, as of March 31, 2026:

	Term Loans Amortized Cost by Origination Year												Revolving
As of March 31, 2026	2026		2025		2024		2023		2022		Prior		Lines		Total
	(In Thousands)
One-to-four family residential
Risk rating
Pass	$	5,223	$	17,100	$	13,291	$	35,439	$	30,910	$	58,578	$	-	$	160,541
Pass watch		-		73		1,539		774		837		1,727		-		4,950
Special mention		-		-		-		-		-		620		-		620
Substandard	$	-	$	548	$	555	$	70	$	637	$	669	$	-	$	2,479
Total One-to-four family residential	$	5,223	$	17,721	$	15,385	$	36,283	$	32,384	$	61,594	$	-	$	168,590
Current period gross charge-offs		-		-		-		-		-		-		-		-

Commercial
Risk rating
Pass	$	7,377	$	26,012	$	6,220	$	9,523	$	21,762	$	60,552	$	-	$	131,446
Pass watch		-		-		76		98		7,725		107		-		8,006
Special mention		-		-		-		-		-		1,942		-		1,942
Substandard		-		-		-		-		15		-		-		15
Total commercial	$	7,377	$	26,012	$	6,296	$	9,621	$	29,502	$	62,601	$	-	$	141,409
Current period gross charge-offs	$	-	$	-	$	-	$	60	$	-	$	145	$	-	$	205

Multi-family residential
Risk rating
Pass	$	-	$	6,936	$	-	$	-	$	323	$	16,452	$	-	$	23,711
Pass watch		-		-		1,116		1,801		-		4,173		-		7,090
Total multi-family residential	$	-	$	6,936	$	1,116	$	1,801	$	323	$	20,625	$	-	$	30,801
Current period gross charge-offs	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-

Land
Risk rating
Pass	$	3,381	$	19,843	$	11,531	$	2,694	$	3,415	$	14,259	$	-	$	55,123
Pass watch		-		167		-		144		-		-		-		311
Total land	$	3,381	$	20,010	$	11,531	$	2,838	$	3,415	$	14,259	$	-	$	55,434
Current period gross charge-offs	$	-	$	-	$	-	$	-	$	10	$	-	$	-	$	10

Construction
Risk rating
Pass	$	1,016	$	4,310	$	-	$	840	$	-	$	-	$	-	$	6,166
Total construction	$	1,016	$	4,310	$	-	$	840	$	-	$	-	$	-	$	6,166
Current period gross charge-offs	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-

	Term Loans Amortized Cost by Origination Year												Revolving
As of March 31, 2026	2026		2025		2024		2023		2022		Prior		Lines		Total
	(In Thousands)
Equity loans and lines of credit
Risk rating
Pass	$	110	$	568	$	550	$	420	$	610	$	416	$	21,071	$	23,745
Pass watch		-		-		-		10		-		-		-		10
Special mention		-		-		-		-		-		-		71		71
Substandard		-		-		-		229		-		-		225		454
Total home equity and lines of credit	$	110	$	568	$	550	$	659	$	610	$	416	$	21,367	$	24,280
Current period gross charge-offs	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-

Commercial Loans
Risk rating
Pass	$	5,680	$	10,378	$	15,301	$	4,463	$	2,214	$	14,194	$	-	$	52,230
Pass watch		328		17		612		119		129		-		-		1,205
Special mention		319		1,943		134		498		-		-		-		2,894
Substandard		-		-		-		-		18		8		-		26
Total commercial loans	$	6,327	$	12,338	$	16,047	$	5,080	$	2,361	$	14,202	$	-	$	56,355
Current period gross charge-offs	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-
Consumer Loans
Risk rating
Pass	$	34	$	199	$	217	$	80	$	59	$	117	$	-	$	706
Substandard		-		-		24		5		-		-		-		29
Total consumer loans	$	34	$	199	$	241	$	85	$	59	$	117	$	-	$	735
Current period gross charge-offs	$	-	$	1	$	-	$	1	$	-	$	-	$	-	$	2

Total
Risk rating
Pass	$	22,821	$	85,346	$	47,110	$	53,459	$	59,293	$	164,568	$	21,071	$	453,668
Pass watch		328		257		3,343		2,946		8,691		6,007		-		21,572
Special mention		319		1,943		134		498		-		2,562		71		5,527
Substandard		-		548		579		304		670		677		225		3,003
Total	$	23,468	$	88,094	$	51,166	$	57,207	$	68,654	$	173,814	$	21,367	$	483,770
Current period gross charge-offs	$	-	$	1	$	-	$	61	$	10	$	145	$	-	$	217

The following tables summarize designated internal risk categories by portfolio segment and loan class, by origination year, as of June 30, 2025:

	Term Loans Amortized Cost by Origination Year												Revolving
As of June 30, 2025	2025		2024		2023		2022		2021		Prior		Lines		Total
	(In Thousands)
One-to-four family residential
Risk rating
Pass	$	12,456	$	20,344	$	40,116	$	35,296	$	30,282	$	28,952	$	-	$	167,446
Pass watch		1,072		1,358		1,088		1,379		257		629		-		5,783
Special mention		-		40		-		-		379		314		-		733
Substandard		-		-		268		252		496		-		-		1,016
Total One-to-four family residential	$	13,528	$	21,742	$	41,472	$	36,927	$	31,414	$	29,895	$	-	$	174,978
Current period gross charge-offs	$	-	$	-	$	34	$	-	$	-	$	-	$	-	$	34

Commercial
Risk rating
Pass	$	21,880	$	12,736	$	17,394	$	32,791	$	36,221	$	13,823	$	-	$	134,845
Pass watch		114		2,488		98		408		-		-		-		3,108
Substandard		-		-		-		19		948		-		-		967
Total commercial	$	21,994	$	15,224	$	17,492	$	33,218	$	37,169	$	13,823	$	-	$	138,920
Current period gross charge-offs	$	-	$	-	$	154	$	-	$	90	$	-	$	-	$	244

Multi-family residential
Risk rating
Pass	$	498	$	6,854	$	1,969	$	4,871	$	942	$	15,942	$	-	$	31,076
Pass watch		1,207		-		-		-		-		-		-		1,207
Total multi-family residential	$	1,705	$	6,854	$	1,969	$	4,871	$	942	$	15,942	$	-	$	32,283
Current period gross charge-offs	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-

Land
Risk rating
Pass	$	8,405	$	8,380	$	3,044	$	3,262	$	3,505	$	994	$	-	$	27,590
Pass watch		79		2,376		-		-		9		-		-		2,464
Total land	$	8,484	$	10,756	$	3,044	$	3,262	$	3,514	$	994	$	-	$	30,054
Current period gross charge-offs	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-

Construction
Risk rating
Pass	$	7,192	$	3,054	$	-	$	-	$	-	$	-	$	-	$	10,246
Pass watch		-		980		-		-		-		-		-		980
Total construction	$	7,192	$	4,034	$	-	$	-	$	-	$	-	$	-	$	11,226
Current period gross charge-offs	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-

	Term Loans Amortized Cost by Origination Year												Revolving
As of June 30, 2025	2025		2024		2023		2022		2021		Prior		Lines		Total
	(In Thousands)
Equity loans and lines of credit
Risk rating
Pass	$	46	$	582	$	629	$	639	$	96	$	376	$	19,823	$	22,191
Pass watch		-		-		10		-		-		-		234		244
Special mention		-		-		-		-		-		-		72		72
Substandard		-		-		142		-		-		-		225		367
Total home equity and lines of credit	$	46	$	582	$	781	$	639	$	96	$	376	$	20,354	$	22,874
Current period gross charge-offs	$	-	$	-	$	-	$	-	$	7	$	17	$	-	$	24

Commercial Loans
Risk rating
Pass	$	6,742	$	21,685	$	9,317	$	4,100	$	2,973	$	4,756	$	-	$	49,573
Pass watch		762		8		70		70		-		-		-		910
Special mention		2,318		179		917		-		128		-		-		3,542
Substandard		-		-		75		25		13		-		-		113
Total commercial loans	$	9,822	$	21,872	$	10,379	$	4,195	$	3,114	$	4,756	$	-	$	54,138
Current period gross charge-offs	$	-	$	-	$	-	$	2	$	-	$	-	$	-	$	2
Consumer Loans
Risk rating
Pass	$	285	$	328	$	280	$	87	$	1	$	101	$	-	$	1,082
Special mention		-		29		-		-		-		-		-		29
Substandard		-		-		9		-		-		-		-		9
Total consumer loans	$	285	$	357	$	289	$	87	$	1	$	101	$	-	$	1,120
Current period gross charge-offs	$	-	$	1	$	18	$	-	$	-	$	-	$	-	$	19
Total
Risk rating
Pass	$	57,504	$	73,963	$	72,749	$	81,046	$	74,020	$	64,944	$	19,823	$	444,049
Pass watch		3,234		7,210		1,266		1,857		266		629		234		14,696
Special mention		2,318		248		917		-		507		314		72		4,376
Substandard		-		-		494		296		1,457		-		225		2,472
Total	$	63,056	$	81,421	$	75,426	$	83,199	$	76,250	$	65,887	$	20,354	$	465,593
Current period gross charge-offs	$	-	$	1	$	206	$	2	$	97	$	17	$	-	$	323

The following tables present an aging analysis of past due loans, segregated by class of loans, as of March 31, 2026 and June 30, 2025:

March 31, 2026	30-59 Days Past Due		60-89 Days Past Due		90 or More Days Past Due		Total Past Due		Current		Total Loans Receivable		Recorded Investment > 90 Days and Accruing
	(In Thousands)
Real Estate Loans:
One-to-Four Family Residential	$	3,149	$	10	$	2,590	$	5,749	$	162,841	$	168,590	$	273
Commercial		-		-		-		-		141,409		141,409		-
Multi-Family Residential		-		-		-		-		30,801		30,801		-
Land		108		-		-		108		55,326		55,434		-
Construction		-		-		-		-		6,166		6,166		-
Equity and Second Mortgage		-		-		142		142		2,771		2,913		-
Equity Lines of Credit		-		-		225		225		21,142		21,367		-
Commercial Loans		95		-		18		113		56,242		56,355		-
Consumer Loans		16		24		-		40		695		735		-
Total	$	3,368	$	34	$	2,975	$	6,377	$	477,393	$	483,770	$	273

June 30, 2025	30-59 Days Past Due		60-89 Days Past Due		90 or More Days Past Due		Total Past Due		Current		Total Loans Receivable		Recorded Investment > 90 Days and Accruing
	(In Thousands)
Real Estate Loans:
One-to-Four Family Residential	$	174	$	853	$	963	$	1,990	$	172,988	$	174,978	$	252
Commercial		99		-		967		1,066		137,854		138,920		-
Multi-Family Residential		-		-		-		-		32,283		32,283		-
Land		17		-		-		17		30,037		30,054		-
Construction		-		-		-		-		11,226		11,226		-
Equity and Second Mortgage		-		-		142		142		2,378		2,520		-
Equity Lines of Credit		48		-		225		273		20,081		20,354		-
Commercial Loans		8		-		38		46		54,092		54,138		-
Consumer Loans		29		-		-		29		1,091		1,120		-
Total	$	375	$	853	$	2,335	$	3,563	$	462,030	$	465,593	$	252

There was no interest income recognized on non-accrual loans during the Nine months ended March 31, 2026, or the year ended June 30, 2025. If the non-accrual loans had been accruing interest at their original contracted rates, gross interest income that would have been recorded for the Nine months ended March 31, 2026 and the year ended June 30, 2025 was approximately $109,000 and $113,000, respectively.

The change in the allowance for credit losses by loan portfolio class and recorded investment in loans for the Nine months ended March 31, 2026 and year ended June 30, 2025 was as follows:

March 31, 2026	Real Estate Loans
	1-4 Family Residential			Commercial			Multi-Family			Land			Construction			Home Equity Loans and Lines of Credit		Commercial Loans			Consumer Loans			Total
	(In Thousands)
Allowance for credit losses:
Beginning Balances	$	2,202		$	1,202		$	113		$	165		$	74		$	182	$	538		$	8		$	4,484
Charge-Offs		-			(205	)		-			(10	)		-			-		-			(2	)		(217	)
Recoveries		1			41			-			1			-			14		2			3			62
Current Provision		(24	)		227			(5	)		228			(31	)		20		(23	)		29			421
Ending Balances	$	2,179		$	1,265		$	108		$	384		$	43		$	216	$	517		$	38		$	4,750

June 30, 2025	Real Estate Loans

	1-4 Family Residential			Commercial			Multi-Family			Land			Construction			Home Equity Loans and Lines of Credit			Commercial Loans			Consumer Loans			Total
	(In Thousands)
Allowance for credit losses:
Beginning Balances	$	2,346		$	1,088		$	130		$	175		$	103		$	165		$	548		$	19		$	4,574
Charge-Offs		(34	)		(244	)		-			-			-			(24	)		(2	)		(19	)		(323	)
Recoveries		351			-			-			1			-			5			2			-			359
Current Provision		(461	)		358			(17	)		(11	)		(29	)		36			(10	)		8			(126	)
Ending Balances	$	2,202		$	1,202		$	113		$	165		$	74		$	182		$	538		$	8		$	4,484

The Company held loans that were individually evaluated for credit losses at March 31, 2026 and June 30, 2025 for which the repayment, on the basis of our assessment at the reporting date, is expected to be provided substantially through the operation or sale of the collateral and the borrower is experiencing financial difficulty. The ACL for these collateral-dependent loans is primarily based on the fair value of the underlying collateral at the reporting date. The following describes the types of collateral that secure collateral dependent loans:

•

One-to-four-family first mortgages are primarily secured by first liens on residential real estate.

•

Commercial real estate loans are primarily secured by office and industrial buildings, warehouses, retail shopping facilities and various special purpose properties, including self-storage facilities, hotels and restaurants.

•

Multi-family loans are primarily secured by residential property that include five or more housing units.

•

Construction and land loans are primarily secured by residential and commercial properties, which are under construction and/or redevelopment, and by raw land.

•

Home equity loans and lines are primarily secured by first and junior liens on residential real estate.

•

Commercial and industrial loans considered collateral dependent are primarily secured by accounts receivable, inventory and equipment.

•

Consumer loans considered collateral dependent are primarily secured by titled vehicles.

The following table presents loans individually evaluated for impairment, segregated by class of loans, as of March 31, 2026 and June 30, 2025:

	March 31, 2026				June 30, 2025
	Loan Balance		Specific Allocations		Loan Balance		Specific Allocations
	(In Thousands)
Real Estate Loans:
One-to-Four Family Residential	$	3,724	$	298	$	2,234	$	97
Commercial		1,956		-		1,081		102
Multi-Family Residential		-		-		-		-
Land		81		3		115		4
Construction		-		-		-		-
Home Equity Loans and Lines of Credit		455		-		367		-
Commercial Loans		33		2		45		2

Consumer Loans		26		24		15		1
Total	$	6,275	$	327	$	3,857	$	206

The Bank has no commitments to loan additional funds to borrowers whose loans were previously in non-accrual status. As of March 31, 2026, there were no residential loans in the process of foreclosure.

As of March 31, 2026, there were no loans whose terms were modified for borrowers who may be experiencing financial difficulties.

At March 31, 2026 and June 30, 2025, accrued interest receivable on loans was $1.737 million and $1.624 million, respectively, and included within accrued interest receivable on the consolidated balance sheets.

Home Federal Bancorp, Inc. of Louisiana 10-Q