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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 10-Q

 

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

 

For the quarterly period ended September 30, 2020

 

Commission File No. 033-79130

 

CONSUMERS BANCORP, INC.

(Exact name of registrant as specified in its charter)

 

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

 

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

 

(330) 868-7701

(Registrant’s telephone number)

 

Not applicable

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

 

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

Yes ☒ No ☐

 

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

Yes ☒ No ☐

 

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

 

Large accelerated filer ☐	Accelerated filer ☐
Non-accelerated filer ☐	Smaller reporting company ☒
	Emerging growth company ☐

         

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

 

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

 

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

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
None

 

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

 

 

 

CONSUMERS BANCORP, INC. FORM 10-Q QUARTER ENDED September 30, 2020

Table of Contents

 

	Page Number (s)
Part I – Financial Information
Item 1 – Financial Statements (Unaudited)
Consolidated Balance Sheets at September 30, 2020 and June 30, 2020	1
Consolidated Statements of Income for the three months ended September 30, 2020 and 2019	2
Consolidated Statements of Comprehensive Income for the three months ended September 30, 2020 and 2019	3
Condensed Consolidated Statements of Changes in Shareholders’ Equity for the three months ended September 30, 2020 and 2019	4
Condensed Consolidated Statements of Cash Flows for the three months ended September 30, 2020 and 2019	5
Notes to the Consolidated Financial Statements	6-19
Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations	20-26
Item 3 – Not Applicable for Smaller Reporting Companies
Item 4 – Controls and Procedures	27
Part II – Other Information
Item 1 – Legal Proceedings	28
Item 1A – Not Applicable for Smaller Reporting Companies	28
Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds	28
Item 3 – Defaults Upon Senior Securities	28
Item 4 – Mine Safety Disclosure	28
Item 5 – Other Information	28
Item 6 – Exhibits	28
Signatures	29

 

 

(Dollars in thousands, except per share data)		September 30, 2020				June 30, 2020
ASSETS
Cash on hand and noninterest-bearing deposits in financial institutions		$	8,239			$	8,429
Federal funds sold and interest-bearing deposits in financial institutions			269				1,230
Total cash and cash equivalents			8,508				9,659
Certificates of deposit in other financial institutions			8,872				11,635
Securities, available-for-sale			136,903				143,918
Securities, held-to-maturity (fair value of $3,734 at September 30, 2020 and $3,868 at June 30, 2020)			3,441				3,541
Federal bank and other restricted stocks, at cost			2,472				2,472
Loans held for sale			5,729				3,507
Total loans			562,138				542,861
Less allowance for loan losses			(5,767	)			(5,678	)
Net loans			556,371				537,183
Cash surrender value of life insurance			9,508				9,442
Premises and equipment, net			15,151				14,901
Goodwill			836				836
Core deposit intangible, net			250				256
Accrued interest receivable and other assets			3,229				3,470
Total assets		$	751,270			$	740,820
LIABILITIES
Deposits
Noninterest-bearing demand		$	188,130			$	190,233
Interest bearing demand			105,262				99,173
Savings			231,440				228,567
Time			115,266				115,382
Total deposits			640,098				633,355
Short-term borrowings			8,414				6,943
Federal Home Loan Bank advances			30,899				31,161
Accrued interest and other liabilities			6,432				6,121
Total liabilities			685,843				677,580
Commitments and contingent liabilities
SHAREHOLDERS’ EQUITY
Preferred stock (no par value, 350,000 shares authorized, none outstanding)			—				—
Common stock (no par value, 8,500,000 shares authorized; 3,124,053 shares issued as of September 30, 2020 and June 30, 2020)			20,011				19,974
Retained earnings			42,424				40,460
Treasury stock, at cost (95,953 and 108,475 common shares as of September 30, 2020 and June 30, 2020, respectively)			(1,324	)			(1,454	)
Accumulated other comprehensive income			4,316				4,260
Total shareholders’ equity			65,427				63,240
Total liabilities and shareholders’ equity		$	751,270			$	740,820

 

		Three Months ended September 30,
(Dollars in thousands, except per share amounts)		2020				2019
Interest and dividend income
Loans, including fees		$	6,489			$	4,761
Securities, taxable			372				510
Securities, tax-exempt			420				399
Federal bank and other restricted stocks			18				20
Federal funds sold and other interest-bearing deposits			47				26
Total interest and dividend income			7,346				5,716
Interest expense
Deposits			577				945
Short-term borrowings			4				11
Federal Home Loan Bank advances			71				79
Total interest expense			652				1,035
Net interest income			6,694				4,681
Provision for loan losses			130				130
Net interest income after provision for loan losses			6,564				4,551
Noninterest income
Service charges on deposit accounts			307				373
Debit card interchange income			456				391
Gain on sale of mortgage loans			236				135
Bank owned life insurance death benefit			—				324
Bank owned life insurance income			66				68
Securities gains, net			—				106
Other			76				72
Total noninterest income			1,141				1,469
Noninterest expenses
Salaries and employee benefits			2,691				2,173
Occupancy and equipment			640				532
Data processing expenses			186				385
Debit card processing expenses			238				201
Professional and director fees			237				257
FDIC assessments			61				(7	)
Franchise taxes			109				95
Marketing and advertising			134				181
Telephone and network communications			84				74
Amortization of intangible			6				—
Other			413				414
Total noninterest expenses			4,799				4,305
Income before income taxes			2,906				1,715
Income tax expense			505				212
Net income		$	2,401			$	1,503
Basic and diluted earnings per share		$	0.80			$	0.55

 

(Dollars in thousands)
		Three Months ended September 30,
		2020				2019
Net income		$	2,401			$	1,503
Other comprehensive income, net of tax:
Net change in unrealized gains (losses) on securities available-for-sale:
Unrealized gains arising during the period			70				818
Reclassification adjustment for gains included in income			—				(106	)
Net unrealized gains			70				712
Income tax effect			(14	)			(149	)
Other comprehensive income			56				563
Total comprehensive income		$	2,457			$	2,066

 

(Dollars in thousands, except per share data)		Common Stock				Retained Earnings				Treasury Stock				Accumulated Other Comprehensive Income (Loss)				Total Shareholders’ Equity
Balance, June 30, 2020		$	19,974			$	40,460			$	(1,454	)		$	4,260			$	63,240
Net income							2,401												2,401
Other comprehensive income															56				56
12,522 shares associated with vested stock awards			37								130								167
Cash dividends declared ($0.145 per share)							(437	)											(437	)
Balance, September 30, 2020		$	20,011			$	42,424			$	(1,324	)		$	4,316			$	65,427
Balance, June 30, 2019		$	14,656			$	36,487			$	(1,543	)		$	1,566			$	51,166
Net income							1,503												1,503
Other comprehensive income															563				563
11,813 shares associated with vested stock awards			41								89								130
Cash dividends declared ($0.135 per share)							(369	)											(369	)
Balance, September 30, 2019		$	14,697			$	37,621			$	(1,454	)		$	2,129			$	52,993

 

(Dollars in thousands)		Three Months Ended September 30,
		2020				2019
Cash flows from operating activities
Net cash from operating activities		$	1,041			$	806
Cash flow from investing activities
Purchases of securities, available-for-sale			(500	)			(2,318	)
Maturities, calls and principal pay downs of securities, available-for-sale			7,355				4,893
Sale of securities, available-for-sale			—				4,460
Principal pay downs of securities, held-to-maturity			100				100
Net decrease in certificate of deposit in other financial institutions			2,763				490
Net increase in loans			(19,327	)			(14,654	)
Proceeds from BOLI death benefit			—				753
Premises and equipment purchases			(106	)			(48	)
Sale of other repossessed assets			8				—
Net cash from investing activities			(9,707	)			(6,324	)
Cash flow from financing activities
Net increase in deposit accounts			6,743				15,260
Net change in short-term borrowings			1,471				68
Proceeds from Federal Home Loan Bank advances			1,300				1,500
Repayments of Federal Home Loan Bank advances			(1,562	)			(7,900	)
Dividends paid			(437	)			(369	)
Net cash from financing activities			7,515				8,559
Increase (decrease) in cash or cash equivalents			(1,151	)			3,041
Cash and cash equivalents, beginning of period			9,659				9,461
Cash and cash equivalents, end of period		$	8,508			$	12,502
Supplemental disclosure of cash flow information:
Cash paid during the period:
Interest		$	652			$	1,050
Federal income taxes			300				—
Non-cash items:
Issuance of treasury stock for stock awards			167				89
Right of use assets obtained in exchange for lease liabilities			—				582

 

Note 1 – Summary of Significant Accounting Policies:

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

 

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

 

(Dollars in thousands, except per share amounts)

 

Note 2 – Acquisition

 

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

 

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

 

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

 

 

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

 

 

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

 

(Dollars in thousands, except per share amounts)

 

Note 3 – Securities

 

 

 

 

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

 

 

 

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

 

(Dollars in thousands, except per share amounts)

 

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

 

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

 

 

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

 

 

 

 

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

 

(Dollars in thousands, except per share amounts)

 

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

 

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

 

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

 

Note 4 – Loans

 

Major classifications of loans were as follows:

 

 

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

 

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

 

 

 

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

 

(Dollars in thousands, except per share amounts)

 

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

 

 

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

 

 

 

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

 

(Dollars in thousands, except per share amounts)

 

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

 

 

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

 

 

 

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

 

(Dollars in thousands, except per share amounts)

 

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

 

 

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

 

 

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, 2020 by class of loans:

 

 

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

 

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

 

 

The above table of past due loans includes the recorded investment in non-accrual loans of $2 in the 60-89 days, $792 in the 90 days or greater category and $391 in the loans not past due category.

 

Troubled Debt Restructurings (TDR):

The Corporation has certain loans that have been modified in order to maximize collection of loan balances that are classified as TDRs. A modified loan is usually classified as a TDR if, for economic reasons, management grants a concession to the original terms and conditions of the loan to a borrower who is experiencing financial difficulties that it would not have otherwise considered. In response to COVID-19, on March 22, 2020 the Corporation adopted a loan modification program to assist borrowers impacted by the virus. The program is available to most borrowers whose loan was not past due on March 22, 2020, the date this loan modification program was adopted. The program offers principal and interest payment deferrals for up to 90 days or interest only payments for up to 90 days. Interest will be deferred but will continue to accrue during the deferment period and the maturity date on amortizing loans will be extended by the number of months the payment was deferred. Consistent with issued regulatory guidance, modifications made under this program in response to COVID-19 will not be classified as TDRs. As of September 30, 2020, payment deferrals under the loan modification program that was adopted in response to COVID-19 were granted on 438 loans which totaled $79,961 and are not classified as TDRs. As of October 31, 2020, 11 loans with an outstanding principal balance of $473 remain in payment deferral status.

 

 

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

 

(Dollars in thousands, except per share amounts)

 

As of September 30, 2020 and June 30, 2020, the Corporation had $956 and $974, respectively, of loans classified as TDRs which are included in impaired loans above. As of September 30, 2020 and 2019, the Corporation had not committed to lend any additional funds to customers with outstanding loans that were classified as troubled debt restructurings. As of September 30, 2020 and June 30, 2020, the Corporation had $8 and $12, respectively, of specific reserve allocated to these loans.

 

During the three-month periods ended September 30, 2020 and 2019, there were no loan modifications completed that were classified as troubled debt restructurings. There were no charge offs from troubled debt restructurings that were completed during the three-month periods ended September 30, 2020 and 2019.

 

There were no loans classified as troubled debt restructurings for which there was a payment default within 12 months following the modification during the three-month periods ended September 30, 2020 and 2019. A loan is considered in payment default once it is 90 days contractually past due under the modified terms.

 

Credit Quality Indicators:

The Corporation 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, current economic trends and other relevant information. The Corporation analyzes loans individually by classifying the loans as to credit risk. This analysis includes loans with a total outstanding loan relationship greater than $100 and non-homogeneous loans, such as commercial and commercial real estate loans. Management monitors the loans on an ongoing basis for any changes in the borrower’s ability to service their debt and affirms the risk ratings for the loans and leases in their respective portfolio on an annual basis. The Corporation uses the following definitions for risk ratings:

 

Special Mention. Loans classified 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 institution’s credit position at some future date.

 

Substandard. Loans classified as substandard are inadequately protected by the current net worth and paying 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.

 

Loans not meeting the criteria above that are analyzed individually as part of the above described process are considered pass rated loans. Loans listed as not rated are either less than $100 or are included in groups of homogeneous loans. Generally, 1-4 Family Residential and Consumer loans are not risk rated, except when collateral is used for a business purpose. These loans are evaluated based on delinquency status, which are disclosed in the previous table within this footnote. Based on the most recent analysis performed, the recorded investment by risk category of loans by class of loans was as follows:

 

 

 

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

 

(Dollars in thousands, except per share amounts)

 

As of June 30, 2020, and based on the most recent analysis performed, the recorded investment by risk category of loans by class of loans is as follows: