CONSUMERS BANCORP INC /OH/ - FORM 10-Q

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EX-32.1 - EXHIBIT 32.1 - CONSUMERS BANCORP INC /OH/	ex32-1.htm
EX-31.2 - EXHIBIT 31.2 - CONSUMERS BANCORP INC /OH/	ex31-2.htm
EX-31.1 - EXHIBIT 31.1 - CONSUMERS BANCORP INC /OH/	ex31-1.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

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

For the quarterly period ended September 30, 2016

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

for the transition period from

Commission File No. 033-79130

CONSUMERS BANCORP, INC.

(Exact name of registrant as specified in its charter)

OHIO		34-1771400
(State or other jurisdiction		(I.R.S. Employer Identification No.)
of incorporation or organization)

614 East Lincoln Way, P.O. Box 256, Minerva, Ohio		44657
(Address of principal executive offices)		(Zip Code)

(330) 868-7701

(Registrant’s telephone number)

Not applicable

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

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐

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

Large accelerated filer ☐	Accelerated filer ☐
Non-accelerated filer ☐ (Do not check if smaller reporting company)	Smaller reporting company ☒

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

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Common Stock, no par value		Outstanding at November 10, 2016
		2,724,956 Common Shares

CONSUMERS BANCORP, INC.

FORM 10-Q

QUARTER ENDED September 30, 2016

Table of Contents

		Page Number (s)
Part I – Financial Information

Item 1 – Financial Statements (Unaudited)
Consolidated Balance Sheets at September 30, 2016 and June 30, 2016		1

Consolidated Statements of Income for the three months ended September 30, 2016 and 2015		2

Consolidated Statements of Comprehensive Income for the three months ended September 30, 2016 and 2015		3

Consolidated Statements of Changes in Shareholders’ Equity for the three months ended September 30, 2016 and 2015		4

Condensed Consolidated Statements of Cash Flows for the three months ended September 30, 2016 and 2015		5

Notes to the Consolidated Financial Statements		6-25

Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations		26-34

Item 3 – Not Applicable for Smaller Reporting Companies

Item 4 – Controls and Procedures		34
Part II – Other Information
Item 1 – Legal Proceedings		35

Item 1A – Not Applicable for Smaller Reporting Companies

Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds		35

Item 3 – Defaults Upon Senior Securities		35

Item 4 – Mine Safety Disclosure		35

Item 5 – Other Information		35

Item 6 – Exhibits		35

Signatures		36

PART I – FINANCIAL INFORMATION

Item 1 – Financial Statements

CONSUMERS BANCORP, INC.

CONSOLIDATED BALANCE SHEETS (Unaudited)

(Dollars in thousands, except per share data)	September 30, 2016			June 30, 2016
ASSETS
Cash on hand and noninterest-bearing deposits in financial institutions	$	8,526		$	8,164
Federal funds sold and interest-bearing deposits in financial institutions		4,007			2,017
Total cash and cash equivalents		12,533			10,181
Certificates of deposit in other financial institutions		5,656			5,906
Securities, available-for-sale		128,310			133,369
Securities, held-to-maturity (fair value of $4,510 at September 30, 2016 and $3,619 at June 30, 2016)		4,399			3,494
Federal bank and other restricted stocks, at cost		1,396			1,396
Loans held for sale		1,810			1,048
Total loans		260,487			256,278
Less allowance for loan losses		(3,684	)		(3,566	)
Net loans		256,803			252,712
Cash surrender value of life insurance		6,867			6,819
Premises and equipment, net		13,588			13,585
Other real estate owned		10			—
Accrued interest receivable and other assets		2,052			1,880
Total assets	$	433,424		$	430,390

LIABILITIES
Deposits
Non-interest bearing demand	$	104,029		$	98,224
Interest bearing demand		50,338			48,810
Savings		132,584			134,606
Time		66,020			65,008
Total deposits		352,971			346,648

Short-term borrowings		20,546			19,129
Federal Home Loan Bank advances		12,366			17,281
Accrued interest and other liabilities		3,521			3,539
Total liabilities		389,404			386,597
Commitments and contingent liabilities

SHAREHOLDERS’ EQUITY
Preferred stock (no par value, 350,000 shares authorized, none outstanding)		—			—
Common stock (no par value, 3,500,000 shares authorized; 2,854,133 shares issued as of September 30, 2016 and June 30, 2016)		14,630			14,630
Retained earnings		29,006			28,432
Treasury stock, at cost (130,606 and 130,375 common shares as of September 30, 2016 and June 30, 2016, respectively)		(1,658	)		(1,658	)
Accumulated other comprehensive income		2,042			2,389
Total shareholders’ equity		44,020			43,793
Total liabilities and shareholders’ equity	$	433,424		$	430,390

See accompanying notes to consolidated financial statements

CONSUMERS BANCORP, INC.

CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

	Three Months ended September 30,
(Dollars in thousands, except per share amounts)	2016		2015

Interest income
Loans, including fees	$	3,184	$	2,795
Securities, taxable		402		457
Securities, tax-exempt		351		344
Federal funds sold and other interest bearing deposits		30		24
Total interest income		3,967		3,620
Interest expense
Deposits		170		176
Short-term borrowings		12		8
Federal Home Loan Bank advances		58		43
Total interest expense		240		227
Net interest income		3,727		3,393
Provision for loan losses		136		92
Net interest income after provision for loan losses		3,591		3,301

Non-interest income
Service charges on deposit accounts		330		314
Debit card interchange income		251		234
Bank owned life insurance income		49		46
Securities gains, net		103		35
Other		115		106
Total non-interest income		848		735
Non-interest expenses
Salaries and employee benefits		1,738		1,732
Occupancy and equipment		452		342
Data processing expenses		145		144
Professional and director fees		132		97
FDIC assessments		55		58
Franchise taxes		84		82
Marketing and advertising		79		93
Telephone and network communications		81		75
Debit card processing expenses		133		116
Other		387		398
Total non-interest expenses		3,286		3,137
Income before income taxes		1,153		899
Income tax expense		252		172
Net income	$	901	$	727

Basic and diluted earnings per share	$	0.33	$	0.27

See accompanying notes to consolidated financial statements

CONSUMERS BANCORP, INC.

Consolidated statements of comprehensive income

(Unaudited)

(Dollars in thousands)
	Three Months ended September 30,
	2016			2015

Net income	$	901		$	727

Other comprehensive income (loss), net of tax:
Net change in unrealized gains (losses) on securities available-for-sale:

Unrealized gains (losses) arising during the period		(423	)		813
Reclassification adjustment for gains included in income		(103	)		(35	)
Net unrealized gain (losses)		(526	)		778
Income tax effect		179			(264	)
Other comprehensive income (losses)		(347	)		514

Total comprehensive income	$	554		$	1,241

See accompanying notes to consolidated financial statements.

CONSUMERS BANCORP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

(Unaudited)

(Dollars in thousands, except per share data)
	Three Months ended September 30,
	2016			2015

Balance at beginning of period	$	43,793		$	41,466

Net income		901			727
Other comprehensive income (loss)		(347	)		514
231 and 248 Dividend reinvestment plan shares associated with forfeited and expired restricted stock awards retired to treasury stock during the three months ended September 30, 2015 and 2016, respectively		—			—
Common cash dividends		(327	)		(328	)

Balance at the end of the period	$	44,020		$	42,379

Common cash dividends per share	$	0.12		$	0.12

See accompanying notes to consolidated financial statements.

CONSUMERS BANCORP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(Dollars in thousands)	Three Months Ended September 30,
	2016			2015
Cash flows from operating activities
Net cash from operating activities	$	581		$	1,021

Cash flow from investing activities
Securities available-for-sale
Purchases		(3,229	)		(7,438	)
Maturities, calls and principal pay downs		5,796			5,346
Proceeds from sales of available-for-sale securities		1,789			1,990
Securities held-to-maturity
Purchases		(1,000	)		—
Principal pay downs		95			90
Net (increase) decrease in certificates of deposits in other financial institutions		250			(1,443	)
Net increase in loans		(4,237	)		(5,443	)
Acquisition of premises and equipment		(191	)		(962	)
Net cash from investing activities		(727	)		(7,860	)

Cash flow from financing activities
Net increase in deposit accounts		6,323			7,895
Net change in short-term borrowings		1,417			2,391
Proceeds from Federal Home Loan Bank advances		9,700			—
Repayments of Federal Home Loan Bank advances		(14,615	)		(15	)
Dividends paid		(327	)		(328	)
Net cash from financing activities		2,498			9,943

Increase in cash or cash equivalents		2,352			3,104

Cash and cash equivalents, beginning of period		10,181			10,544
Cash and cash equivalents, end of period	$	12,533		$	13,648

Supplemental disclosure of cash flow information:
Cash paid during the period:
Interest	$	242		$	229
Federal income taxes		—			200
Non-cash items:
Transfer from loans to other real estate owned		10			38
Expired and forfeited dividend reinvestment plan shares associated with restricted stock awards that were retired to treasury stock		4			4

See accompanying notes to consolidated financial statements.

CONSUMER BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

Note 1 – Summary of Significant Accounting Policies:

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

Basis of Presentation: The consolidated financial statements for interim periods are unaudited and reflect all adjustments (consisting of only normal recurring adjustments), which, in the opinion of management, are necessary to present fairly the financial position and results of operations and cash flows for the periods presented. The unaudited financial statements are presented in accordance with the requirements of Form 10-Q and do not include all disclosures normally required by accounting principles generally accepted in the United States of America. The financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Corporation’s Form 10-K for the year ended June 30, 2016. The results of operations for the interim period disclosed herein are not necessarily indicative of the results that may be expected for a full year.

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

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

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

Recently Issued Accounting Pronouncements Not Yet Effective: In June 2016, FASB Issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. This ASU adds a new Topic 326 to the Codification and removes the thresholds that companies apply to measure credit losses on financial instruments measured at amortized cost, such as loans, receivables, and held-to-maturity debt securities. Under current U.S. GAAP, companies generally recognize credit losses when it is probable that the loss has been incurred. The revised guidance will remove all current loss recognition thresholds and will require companies to recognize an allowance for credit losses for the difference between the amortized cost basis of a financial instrument and the amount of amortized cost that the corporation expects to collect over the instrument’s contractual life. ASU 2016-13 also amends the credit loss measurement guidance for available-for-sale debt securities and beneficial interests in securitized financial assets. The guidance in ASU 2016-13 is effective for “public business entities,” as defined, that are SEC filers for fiscal years and for interim periods with those fiscal years beginning after December 15, 2019. Early adoption of the guidance is permitted for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Management is currently evaluating the impact of the adoption of this guidance on the Corporation’s consolidated financial statements.

CONSUMER BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

Note 2 – Securities

Available –for-Sale	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
September 30, 2016
Obligations of U.S. government-sponsored entities and agencies	$	10,078	$	250	$	—		$	10,328
Obligations of state and political subdivisions		54,131		1,737		(9	)		55,859
Mortgage-backed securities – residential		54,013		832		(33	)		54,812
Mortgage-backed securities– commercial		1,479		24		—			1,503
Collateralized mortgage obligations– residential		5,360		29		(1	)		5,388
Pooled trust preferred security		154		266		—			420

Total available-for-sale securities	$	125,215	$	3,138	$	(43	)	$	128,310

Held-to-Maturity	Amortized Cost		Gross Unrecognized Gains		Gross Unrecognized Losses		Fair Value
September 30, 2016
Obligations of state and political subdivisions	$	4,399	$	111	$	—	$	4,510

Available–for-Sale	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
June 30, 2016
Obligations of U.S. government-sponsored entities and agencies	$	9,682	$	362	$	—		$	10,044
Obligations of state and political subdivisions		53,952		2,010		(8	)		55,954
Mortgage-backed securities – residential		58,702		920		(26	)		59,596
Mortgage-backed securities – commercial		1,485		41		—			1,526
Collateralized mortgage obligations - residential		5,774		49		(3	)		5,820
Pooled trust preferred security		153		276		—			429

Total available-for-sale securities	$	129,748	$	3,658	$	(37	)	$	133,369

CONSUMER BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

Held-to-Maturity	Amortized Cost		Gross Unrecognized Gains		Gross Unrecognized Losses		Fair Value
June 30, 2016
Obligations of state and political subdivisions	$	3,494	$	125	$	—	$	3,619

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

	Three Months Ended September 30,
	2016		2015
Proceeds from sales	$	1,789	$	1,990
Gross realized gains		103		35
Gross realized losses		—		—

The income tax provision applicable to these net realized gains amounted to $35 for the three months ended September 30, 2016 and $12 for the three months ended September 30, 2015.

The amortized cost and fair values of debt securities at September 30, 2016, by expected maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date, primarily mortgage-backed securities, collateralized mortgage obligations and the pooled trust preferred security are shown separately.

Available-for-Sale	Amortized Cost		Estimated Fair Value
Due in one year or less	$	3,697	$	3,724
Due after one year through five years		14,804		15,287
Due after five years through ten years		27,972		28,917
Due after ten years		17,736		18,259
Total		64,209		66,187

U.S. Government-sponsored mortgage-backed and related securities		60,852		61,703
Pooled trust preferred security		154		420
Total available-for-sale securities	$	125,215	$	128,310

Held-to-Maturity

Due after five years through ten years		674		702
Due after ten years		3,725		3,808
Total held-to-maturity securities	$	4,399	$	4,510

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

The following table summarizes the securities with unrealized losses at September 30, 2016 and June 30, 2016, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position:

	Less than 12 Months					12 Months or more					Total
Available-for-sale	Fair Value		Unrealized Loss			Fair Value		Unrealized Loss			Fair Value		Unrealized Loss
September 30, 2016
Obligations of states and political subdivisions	$	2,018	$	(6	)	$	275	$	(3	)	$	2,293	$	(9	)
Mortgage-backed securities - residential		7,573		(15	)		3,427		(18	)		11,000		(33	)
Collateralized mortgage obligations – residential816(1)——816(1)		—		—			1,103		(1	)		1,103		(1	)

Total temporarily impaired	$	9,591	$	(21	)	$	4,805	$	(22	)	$	14,396	$	(43	)

	Less than 12 Months					12 Months or more					Total
Available-for-sale	Fair Value		Unrealized Loss			Fair Value		Unrealized Loss			Fair Value		Unrealized Loss
June 30, 2016
Obligations of states and political subdivisions	$	572	$	(6	)	$	641	$	(2	)	$	1,213	$	(8	)
Mortgage-backed securities - residential		4,899		(12	)		4,836		(14	)		9,735		(26	)
Collateral mortgage obligation - residential		—		—			1,212		(3	)		1,212		(3	)

Total temporarily impaired	$	5,471	$	(18	)	$	6,689	$	(19	)	$	12,160	$	(37	)

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

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

CONSUMER BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

The unrealized losses within the securities portfolio as of September 30, 2016 have not been recognized into income because the decline in fair value is not attributed to credit quality, management does not intend to sell and it is likely that management will not be required to sell the securities prior to their anticipated recovery. The decline in fair value of the mortgage-backed securities, obligations of state and political subdivisions and collateralized mortgage obligations is largely due to changes in interest rates. The fair value is expected to recover as the securities approach maturity. The mortgage-backed securities and collateralized mortgage obligations were primarily issued by Fannie Mae, Freddie Mac and Ginnie Mae, institutions which the government has affirmed its commitment to support. The Corporation does not own any private label mortgage-backed securities.

Note 3 – Loans

Major classifications of loans were as follows:

	September 30,			June 30,
	2016			2016
Commercial	$	44,855		$	43,156
Commercial real estate:
Construction		7,170			7,755
Other		153,375			152,766
1 – 4 Family residential real estate:
Owner occupied		32,150			31,091
Non-owner occupied		15,093			14,438
Construction		2,348			1,269
Consumer		5,496			5,803
Subtotal		260,487			256,278
Allowance for loan losses		(3,684	)		(3,566	)
Net Loans	$	256,803		$	252,712

CONSUMERS BANCORP, INC.

Notes to Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

Loans presented above are net of deferred loan fees and costs of $342 and $360 for September 30, 2016 and June 30, 2016, respectively.

The following table presents the activity in the allowance for loan losses by portfolio segment for the three months ended September 30, 2016:

					1-4 Family
			Commercial		Residential
			Real		Real
	Commercial		Estate		Estate			Consumer			Total

Allowance for loan losses:
Beginning balance	$	505	$	2,518	$	402		$	141		$	3,566
Provision for loan losses		5		125		27			(21	)		136
Loans charged-off		—		—		(21	)		(4	)		(25	)
Recoveries		—		—		3			4			7
Total ending allowance balance	$	510	$	2,643	$	411		$	120		$	3,684

The following table presents the activity in the allowance for loan losses by portfolio segment for the three months ended September 30, 2015:

						1-4 Family
			Commercial			Residential
			Real			Real
	Commercial		Estate			Estate			Consumer			Total

Allowance for loan losses:
Beginning balance	$	316	$	1,660		$	289		$	167		$	2,432
Provision for loan losses		71		70			(11	)		(38	)		92
Loans charged-off		—		(3	)		—			(18	)		(21	)
Recoveries		—		—			—			11			11
Total ending allowance balance	$	387	$	1,727		$	278		$	122		$	2,514

CONSUMERS BANCORP, INC.

Notes to Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

The following table presents the balance in the allowance for loan losses and the recorded investment in loans by portfolio segment and based on impairment method as of September 30, 2016. Included in the recorded investment in loans is $578 of accrued interest receivable.

					1-4 Family
			Commercial		Residential
			Real		Real
	Commercial		Estate		Estate		Consumer		Total
Allowance for loan losses:
Ending allowance balance attributable to loans:
Individually evaluated for impairment	$	—	$	895	$	6	$	—	$	901
Collectively evaluated for impairment		510		1,748		405		120		2,783
Total ending allowance balance	$	510	$	2,643	$	411	$	120	$	3,684

Recorded investment in loans:
Loans individually evaluated for impairment	$	—	$	2,612	$	510	$	—	$	3,122
Loans collectively evaluated for impairment		44,953		158,277		49,206		5,507		257,943
Total ending loans balance	$	44,953	$	160,889	$	49,716	$	5,507	$	261,065

CONSUMERS BANCORP, INC.

Notes to Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

The following table presents the balance in the allowance for loan losses and the recorded investment in loans by portfolio segment and based on impairment method as of June 30, 2016. Included in the recorded investment in loans is $549 of accrued interest receivable net of deferred loans fees and cost of $360.

					1-4 Family
			Commercial		Residential
			Real		Real
	Commercial		Estate		Estate		Consumer		Total
Allowance for loan losses:
Ending allowance balance attributable to loans:
Individually evaluated for impairment	$	—	$	868	$	6	$	—	$	874
Collectively evaluated for impairment		505		1,650		396		141		2,692
Total ending allowance balance	$	505	$	2,518	$	402	$	141	$	3,566

Recorded investment in loans:
Loans individually evaluated for impairment	$	1,029	$	5,105	$	758	$	—	$	6,892
Loans collectively evaluated for impairment		42,219		155,734		46,166		5,816		249,935
Total ending loans balance	$	43,248	$	160,839	$	46,924	$	5,816	$	256,827

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

The following table presents information related to average recorded investment and interest income associated with loans individually evaluated for impairment by class of loans as of September 30, 2016 and for the three months ended September 30, 2016:

	As of September 30, 2016						Three Months ended September 30, 2016
	Unpaid				Allowance for		Average		Interest		Cash Basis
	Principal		Recorded		Loan Losses		Recorded		Income		Interest
	Balance		Investment		Allocated		Investment		Recognized		Recognized
With no related allowance recorded:
Commercial	$	—	$	—	$	—	$	660	$	80	$	80
Commercial real estate:
Construction		16		16		—		329		6		6
Other		62		62		—		1,555		105		105
1-4 Family residential real estate:
Owner occupied		127		127		—		127		—		—
Non-owner occupied		207		206		—		208		—		—
With an allowance recorded:
Commercial real estate:
Other		2,728		2,534		895		2,449		8		8
1-4 Family residential real estate:
Owner occupied		176		177		6		177		2		2
Total	$	3,316	$	3,122	$	901	$	5,505	$	201	$	201

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

The following table presents information related to loans individually evaluated for impairment by class of loans as of June 30, 2016 and for the three months ended September 30, 2015:

	As of June 30, 2016						Three Months ended September 30, 2015
	Unpaid				Allowance for		Average		Interest		Cash Basis
	Principal		Recorded		Loan Losses		Recorded		Income		Interest
	Balance		Investment		Allocated		Investment		Recognized		Recognized
With no related allowance recorded:
Commercial	$	1,033	$	1,029	$	—	$	—	$	—	$	—
Commercial real estate:
Construction		386		384		—		12		—		—
Other		2,121		2,106		—		2,059		—		—
1-4 Family residential real estate:
Owner occupied		175		174		—		267		—		—
Non-owner occupied		722		407		—		77		—		—
With an allowance recorded:
Commercial real estate:
Other		2,802		2,615		868		894		9		9
1-4 Family residential real estate:
Owner occupied		177		177		6		122		2		2
Non-owner occupied		—		—		—		458		4		4
Total	$	7,416	$	6,892	$	874	$	3,889	$	15	$	15

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

The following table presents the recorded investment in non-accrual and loans past due over 90 days still on accrual by class of loans as of September 30, 2016 and June 30, 2016:

	September 30, 2016				June 30, 2016
			Loans Past Due				Loans Past Due
			Over 90 Days				Over 90 Days
			Still				Still
	Non-accrual		Accruing		Non-accrual		Accruing
Commercial	$	—	$	—	$	1,009	$	—
Commercial real estate:
Construction		16		—		384		—
Other		1,945		—		4,000		—
1 – 4 Family residential:
Owner occupied		187		—		234		—
Non-owner occupied		206		—		407		—
Consumer		—		—		—		—
Total	$	2,354	$	—	$	6,034	$	—

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

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

The following table presents the aging of the recorded investment in past due loans as of September 30, 2016 by class of loans:

	Days Past Due
	30 - 59		60 - 89		90 Days or		Total		Loans Not
	Days		Days		Greater		Past Due		Past Due		Total
Commercial	$	—	$	—	$	—	$	—	$	44,953	$	44,953
Commercial real estate:
Construction		—		—		—		—		7,182		7,182
Other		—		—		1,578		1,578		152,129		153,707
1-4 Family residential:
Owner occupied		11		—		187		198		32,035		32,233
Non-owner occupied		—		—		—		—		15,132		15,132
Construction		—		—		—		—		2,351		2,351
Consumer		5		9		—		14		5,493		5,507
Total	$	16	$	9	$	1,765	$	1,790	$	259,275	$	261,065

The above table of past due loans includes the recorded investment in non-accrual loans of $1,765 in the 90 days or greater category and $589 in the loans not past due category.

The following table presents the aging of the recorded investment in past due loans as of June 30, 2016 by class of loans:

	Days Past Due
	30 - 59		60 - 89		90 Days or		Total		Loans Not
	Days		Days		Greater		Past Due		Past Due		Total
Commercial	$	123	$	—	$	—	$	123	$	43,125	$	43,248
Commercial real estate:
Construction		—		—		—		—		7,764		7,764
Other		59		—		2,110		2,169		150,906		153,075
1-4 Family residential:
Owner occupied		15		—		218		233		30,947		31,180

CONSUMERS BANCORP INC /OH/ - FORM 10-Q - November 14, 2016

Attached files