What changed in this filing

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Item 1. Financial Statements

2024-11-14 compared with 2024-05-15 · 339 added, 403 removed, 652 unchanged (53% of the section changed)

3 unchanged sentences

(In thousands, except share data)

September 30,

Cash and due from financial institutions

2 unchanged sentences

Cash and cash equivalents

Securities available-for-sale

Securities held-to-maturity, at amortized cost- approximate fair value of $ 210 and $ 259 at March 31, 2024 and June 30, 2023, respectively

Loans, net of allowance for credit loss of $ 2,106 and $ 1,634 at March 31, 2024 and June 30, 2023, respectively 1

Real estate owned, net

Premises and equipment, net

Securities available-for-sale- at fair value

Securities held-to-maturity, at amortized cost-approximate fair value of $ 195 and $ 203 at September 30, 2024 and June 30, 2024, respectively

Loans held for sale

net of allowance for credit losses of $ 2,141 and $ 2,127 at September 30, 2024 and June 30, 2024, respectively

Real estate acquired through foreclosure

Office premises and equipment - at depreciated cost

Federal Home Loan Bank stock - at cost

1 unchanged sentence

Bank-owned life insurance

Prepaid federal income taxes

Prepaid income taxes

Prepaid expenses and other assets

LIABILITIES AND SHAREHOLDERS’ EQUITY

LIABILITIES AND SHAREHOLDERS’

Certificates of deposit

Demand deposit accounts

Federal Home Loan Bank advances

4 unchanged sentences

Total liabilities

Commitments and contingencies

Shareholders’ equity

Preferred stock, 500,000 shares authorized, $ .01 par value;

no shares issued and outstanding

no shares issued

Common stock, 20,000,000 shares authorized, $ .01 par value;

1 unchanged sentence

Additional paid-in capital

Retained earnings

Unearned employee stock ownership plan (ESOP)

Treasury shares at cost, 509,349 common shares at March 31, 2024 and June 30, 2023, respectively

Retained earnings - restricted

Treasury shares at cost, 509,349 common shares at September 30, 2024 and June 30, 2024, respectively

Accumulated other comprehensive loss

Total shareholders’ equity

Total liabilities and shareholders’ equity

1 Beginning July 1, 2023 the ACL was estimated based on current expected credit loss methodology.

Prior to July 1, 2023, the estimate was based on the incurred loss methodology.

See additional discussion in Note 1, Basis of Presentation.

Total liabilities and shareholders’

See accompanying notes to condensed consolidated

3 unchanged sentences

(Dollars in thousands, except per share data)

Nine months ended

Three months ended

September 30,

Interest income

8 unchanged sentences

Net interest income

Provision for (recovery of) credit losses

Provision for credit losses

Net interest income after provision for credit losses

1 unchanged sentence

Earnings on bank-owned life insurance

Net gain on sales of loans

Net gain on sales of real estate owned

Net gain on sale of property and equipment held for sale

Net gain (loss) on sales of loans

Net gain on sale of other real estate owned

Net gain on sale of real estate owned

Total non-interest income

11 unchanged sentences

Total non-interest expense

Income (loss) before income taxes

Income tax expense (benefit)

NET INCOME (LOSS)

EARNINGS PER SHARE

Loss before income taxes

Income tax benefit

LOSS PER SHARE

Basic and diluted

4 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE

INCOME (LOSS)

(In thousands)

Nine months ended

Three months ended

Net income (loss)

Other comprehensive gains (losses), net of tax:

Unrealized holding gains (losses) on securities designated as available-for-sale, net of taxes of $ 11 , $( 119 ), $( 21 ) and $( 6 ) during the respective periods

September 30,

Other comprehensive income (losses), net of tax:

Unrealized gains (losses) on securities designated as available-for-sale, net of taxes (benefits) of $ 80 and $( 46 ) during the respective periods

Comprehensive income (loss)

3 unchanged sentences

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’

For the nine months ended

For the three months ended

(Dollar amounts in thousands, except per share

March 31, 2024

September 30, 2024

comprehensive

1 unchanged sentence

Balance at June 30, 2023

Cumulative impact of adoption of ASC 326

Balance at July 1, 2023

Other comprehensive income

Cash dividends of $ 0.20 per common share

Balance at March 31, 2024

March 31, 2023

Balance at September 30, 2024

September 30, 2023

comprehensive

income (loss)

Balance at June 30, 2023

Allocation of ESOP shares

Acquisition of shares for Treasury

Other comprehensive loss

Cash dividends of $ 0.30 per common share

Balance at March 31, 2023

See accompanying notes to condensed consolidated

financial statements.

Kentucky First Federal Bancorp

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’

For the three months ended

(Dollar amounts in thousands, except per share

March 31, 2024

comprehensive

Balance at December 31, 2023

Other comprehensive loss

Balance at March 31, 2024

March 31, 2023

comprehensive

Balance at December 31, 2022

Allocation of ESOP shares

Acquisition of shares for Treasury

Cumulative impact of adoption of ASC 326

Balance at July 1, 2023

Other comprehensive loss

Cash dividends of $ 0.10 per common share

Balance at March 31, 2023

Balance at September 30, 2023

See accompanying notes to condensed consolidated

3 unchanged sentences

(In thousands)

Nine months ended

Three months ended

September 30,

Cash flows from operating activities:

Net income (loss)

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

Adjustments to reconcile net loss to net cash from operating activities

Accretion of purchased loan credit discount

1 unchanged sentence

Amortization of premiums on investment securities

Net gain on sale of loans

Net loss (gain) on sale of real estate owned

Net gain on sale of property & equipment

ESOP compensation expense

Net (gain) loss on sale of loans

Net (gain) loss on sale of real estate owned

Earnings on bank-owned life insurance

Provision for (recovery of) credit losses

Provision for credit losses

Origination of loans held for sale

Proceeds from loans held for sale

Deferred income tax

Deferred income taxes

Increase (decrease) in cash, due to changes in:

3 unchanged sentences

Other liabilities

Net cash provided by (used in) operating activities

Net cash used in operating activities

Cash flows from investing activities:

Purchase of investments available for sale

Purchase of FHLB stock

Maturities of time deposits in other financial institutions

Securities maturities, prepayments and calls:

1 unchanged sentence

Available for sale

Purchase of FHLB stock

Proceeds from redemption of FHLB stock

Loans originated for investment, net of principal collected

Proceeds from sale of property and equipment held for sale

Proceeds from REO

Proceeds from sale of real estate owned

6 unchanged sentences

Repayments on Federal Home Loan Bank advances

Treasury stock purchased

Dividends paid on common stock

Net cash provided by (used in) financing activities

Net cash provided by financing activities

Net increase (decrease) in cash and cash equivalents

6 unchanged sentences

(In thousands)

Nine months ended

Three months ended

September 30,

Supplemental disclosure of cash flow information:

1 unchanged sentence

Interest on deposits and borrowings

Transfers of loans to real estate owned, net

See accompanying notes to condensed consolidated

2 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

September 30, 2024

The Kentucky First Federal Bancorp (“Kentucky

9 unchanged sentences

In accounting

for the transaction, the assets and liabilities of CKF Bancorp were recorded on the books of First Federal of Kentucky in accordance with

accounting standard ASC 805, Business Combinations.

for the transaction, the assets and liabilities of CKF Bancorp were recorded on the books of First Federal of Kentucky in accordance

with accounting standard ASC 805, Business Combinations.

Basis of Presentation

6 unchanged sentences

of the condensed consolidated financial statements have been included.

The results of operations for the nine-month period ended March

The results of operations for the three-month period ended September

30, 2024, are not necessarily indicative of the results which may be expected for an entire fiscal year.

3 unchanged sentences

disclosures normally included in the Company’s annual financial statements prepared in accordance with U.S.

generally accepted accounting

principles have been condensed or omitted.

These condensed consolidated financial statements should be read in conjunction with the consolidated

financial statements and notes thereto included in the Company’s Form 10-K annual report for 2023 filed with the Securities and

Exchange Commission.

generally accepted

accounting principles have been condensed or omitted.

These condensed consolidated financial statements should be read in conjunction

with the consolidated financial statements and notes thereto included in the Company’s Form 10-K annual report for 2024 filed with

the Securities and Exchange Commission.

Principles of Consolidation - The

3 unchanged sentences

balances have been eliminated in consolidation.

The Company is a majority-owned subsidiary of First Federal MHC.

The accounts of First

Federal MHC are not consolidated in the accompanying consolidated financial statements of the Company.

Critical Accounting Policies and Estimates

3 unchanged sentences

those we have both the intent and ability to hold to maturity and are reported at amortized cost.

Securities that are not considered held-to-maturity

are considered either trading or available-for-sale securities in accordance with Financial Accounting Standards Board Accounting Standards

Codification (“ASC”) 320, Investments – Debt Securities, and are reported at fair value in the statement of financial

Securities that are not considered

held-to-maturity are considered either trading or available-for-sale securities in accordance with Financial Accounting Standards Board

Accounting Standards Codification (“ASC”) 320, Investments – Debt Securities, and are reported at fair value

in the statement of financial position.

We have no trading securities.

The adjustment to fair value for available-for-sale securities for unrealized gains and losses

is included as a separate component of shareholders’ equity, net of tax.

Loans – Loans for which we have the

ability and intent to hold until maturity and/or payoff are reported at the carrying value of the unpaid principal reduced by unearned

The adjustment to fair value for available-for-sale securities

for unrealized gains and losses is included as a separate component of shareholders’ equity, net of tax.

Loans – Loans for which we have

the ability and intent to hold until maturity and/or payoff are reported at the carrying value of the unpaid principal reduced by unearned

interest, an allowance for credit losses and unamortized deferred fees and costs and premiums.

Interest income is accrued on a level yield

In circumstances where management believes that collection of interest income is uncollectible on specific loans, after considering

economic and business conditions, collateral value and collection efforts, interest accrual is discontinued.

Interest income may be recognized

on the cash basis when received unless a determination has been made by management to apply all of the payment against principal.

Interest income is accrued on a level

In circumstances where management believes that collection of interest income is uncollectible on specific loans, after

considering economic and business conditions, collateral value and collection efforts, interest accrual is discontinued.

Interest income

may be recognized on the cash basis when received unless a determination has been made by management to apply all of the payment against

Kentucky First Federal Bancorp

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

September 30, 2024

Basis of Presentation (continued)

14 unchanged sentences

Credits that are nonaccrual status are subject to individual evaluation.

Historical loss rates for loans are adjusted for

significant factors that, in management’s judgment, reflect the impact of any current conditions on loss recognition.

Historical loss rates for loans are adjusted

for significant factors that, in management’s judgment, reflect the impact of any current conditions on loss recognition.

factors used to derive our ACL include delinquency trends, current economic conditions and trends, strength of supervision and administration

5 unchanged sentences

Income Taxes – Income tax expense

is based on the taxes due on the consolidated tax return plus deferred taxes on the expected future tax benefits and consequences of temporary

differences between carrying amounts and tax bases of assets and liabilities, using enacted tax rates.

is based on the taxes due on the consolidated tax return plus deferred taxes on the expected future tax benefits and consequences of

temporary differences between carrying amounts and tax bases of assets and liabilities, using enacted tax rates.

New Accounting Standards

10 unchanged sentences

The allowance for credit losses for purchased financial assets with a more-than-insignificant

amount of credit deterioration since origination (referred to as “PCD assets”), should be determined in a similar manner to

other financial assets measured on an amortized cost basis.

However, upon initial recognition, the allowance for credit losses is added

to the purchase price to determine the initial amortized cost basis.

The subsequent accounting for PCD financial assets is the same expected

loss model described herein.

amount of credit deterioration since origination (referred to as “PCD assets”), should be determined in a similar manner

to other financial assets measured on an amortized cost basis.

However, upon initial recognition, the allowance for credit losses is

added to the purchase price to determine the initial amortized cost basis.

The subsequent accounting for PCD financial assets is the

same expected loss model described herein.

Kentucky First Federal Bancorp

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

September 30, 2024

Basis of Presentation (continued)

8 unchanged sentences

credit deterioration.

The standard was effective for public companies for annual periods and interim periods within those annual periods

beginning after December 15, 2019.

However, the FASB delayed the implementation of the ASU for smaller reporting companies until years

beginning after December 15, 2022, or in the Company’s case the fiscal year beginning July 1, 2023.

ASU 2016-13 was applied through

a cumulative effect adjustment to retained earnings (modified-retrospective approach).

ASU 2016-13 was applied through a cumulative effect adjustment to retained earnings (modified-retrospective approach).

In addition, ASC 326 made changes to the accounting

6 unchanged sentences

the modified retrospective method for all financial assets measured at amortized cost and off-balance sheet (“OBS”) credit

Results for reporting periods beginning after July 1, 2023 are presented under ASC 326, while prior period amounts continue

to be reported in accordance with previously applicable GAAP.

Upon adoption of the ASU we recorded an increase

3 unchanged sentences

a decrease of $ 414,000 to retained earnings and a deferred tax asset of $ 137,000 .

A liability of $ 57,000 is in place at September

30, 2024 to account for off-balance sheet unfunded commitments compared to $ 54,000 at September 30, 2023.

Management considers contractual

commitments, most of which are commitments to complete construction projects or the balance of unfunded lines of credit.

These totaled

approximately $ 23.6 million at September 30, 2024 and $ 26.1 million at September 30, 2023.

To calculate the liability, management applied

a loss criteria similar to that used for funded loans to calculate the ACL.

The following table illustrates the impact of

11 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

September 30, 2024

Basis of Presentation (continued)

25 unchanged sentences

Diluted earnings per share is computed taking

into consideration common shares outstanding and dilutive potential common shares to be issued or released under the Company’s share-based

compensation plans.

into consideration common shares outstanding and dilutive potential common shares to be issued or released under the Company’s

share-based compensation plans.

The factors used in the basic and diluted earnings per share computations follow:

Nine months ended

Three months ended

Net income (loss) allocated to common shareholders, basic and diluted

$ ( 643,000 )

September 30,

Net loss allocated to common shareholders, basic and diluted

$ ( 175,000 )

EARNINGS PER SHARE

Loss per share, basic and diluted

Weighted average common shares outstanding, basic and diluted

There were no stock option shares outstanding

for the nine- or three-month periods ended March 31, 2024 and 2023.

for the three-month periods ended September 30, 2024 and 2023.

Kentucky First Federal Bancorp

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

September 30, 2024

Investment Securities

The following table summarizes the amortized cost

and fair value of securities available-for-sale and securities held-to-maturity at March 31, 2024 and June 30, 2023, the corresponding

The following table summarizes the amortized

cost and fair value of securities available-for-sale and securities held-to-maturity at September 30, 2024 and June 30, 2024, the corresponding

amounts of gross unrealized gains recognized in accumulated other comprehensive income and gross unrecognized gains and losses:

March 31, 2024

September 30, 2024

(in thousands)

9 unchanged sentences

Agency mortgage-backed:

At March 31, 2024 and June 30, 2023 the Company’s

At September 30, 2024 and June 30, 2024 the Company’s

debt securities consisted of mortgage-backed securities, which do not have a single maturity date.

Actual maturities may differ from contractual

maturities, because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

Our pledged securities totaled $ 0 and $ 5.9 million

at March 31, 2024 and June 30, 2023, respectively.

In addition, at March 31, 2024 and June 30, 2023, our pledged assets included overnight

deposits of $ 0 and $ 1.5 million, respectively.

The Banks began utilizing FHLB letters of credit to secure public deposits in the recently

ended quarter.

Actual maturities may differ from

contractual maturities, because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

Our pledged securities totaled $ 0 at both September

30, 2024 and June 30, 2024.

In addition, at both September 30, 2024 and June 30, 2024, pledged overnight deposits totaled $ 0 .

We evaluated securities in unrealized loss positions

for evidence of credit loss, considering duration, severity, financial condition of the issuer, our intention to sell or requirement to

for evidence of credit loss, considering duration, severity, financial condition of the issuer, our intention to sell or requirement

Those securities were agency mortgage-backed securities, which carry a very limited amount of risk.

Also, we have no intention to

sell nor feel that we will be compelled to sell such securities before maturity.

Based on our evaluation, no reserve for credit loss was

considered necessary.

Debt securities in an unrealized loss position as a percent of total debt securities were 100 % and 100 % at March

31, 2024 and June 30, 2023, respectively.

The following table provides the amortized cost, gross unrealized losses, fair value, and length

of time the individual securities have been in a continuous unrealized loss position as of March 31, 2024.

Kentucky First Federal Bancorp

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

Investment Securities (continued)

As of March 31, 2024:

Also, we have no intention

to sell nor feel that we will be compelled to sell such securities before maturity.

Based on our evaluation, no reserve for credit loss

was considered necessary.

Debt securities in an unrealized loss position as a percent of total debt securities were 86.7 % and 100 % at

September 30, 2024 and June 30, 2024, respectively.

The following table provides the amortized cost, gross unrealized losses, fair value,

and length of time the individual securities have been in a continuous unrealized loss position as of September 30, 2024.

September 30, 2024

Available-for-Sale

1 unchanged sentence

Less Than 12 Months

Mortgage-backed securities

Agency mortgage-backed securities

12 Months or More

Mortgage-backed securities

Agency mortgage-backed securities

Total temporarily impaired AFS securities

Kentucky First Federal Bancorp

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2024

Investment Securities (continued)

Held to Maturity

1 unchanged sentence

Less Than 12 Months

Mortgage-backed securities

Agency mortgage-backed securities

12 Months or More

Mortgage-backed securities

Agency mortgage-backed securities

Total temporarily impaired HTM securities

As of June 30, 2023:

June 30, 2024

Available-for-Sale

1 unchanged sentence

Less Than 12 Months

Mortgage-backed securities

Agency mortgage-backed securities

12 Months or More

Mortgage-backed securities

Agency mortgage-backed securities

Total temporarily impaired AFS securities

6 unchanged sentences

Total temporarily impaired HTM securities

Kentucky First Federal Bancorp

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

Loans receivable

4 unchanged sentences

principal balance unless the collectability of the loan is in doubt.

Loan origination fees, net of certain direct origination costs, are

deferred and recognized in interest income using the level-yield method without anticipating prepayments.

Interest income on one- to four-family

residential loans is generally discontinued at the time a loan is 180 days delinquent and on other loans at the time a loan is 90 days

All other loans are moved to non-accrual status in accordance with the Company’s policy, typically 90 days after the

loan becomes delinquent.

Loan origination fees, net of certain direct origination costs,

are deferred and recognized in interest income using the level-yield method without anticipating prepayments.

Interest income on one-

to four-family residential loans is generally discontinued at the time a loan is 180 days delinquent and on other loans at the time a

loan is 90 days delinquent.

All other loans are moved to non-accrual status in accordance with the Company’s policy, typically

90 days after the loan becomes delinquent.

Past due status is based on the contractual terms of the loan.

In all cases, loans are placed on nonaccrual or

charged-off at an earlier date if collection of principal or interest is considered doubtful.

Nonaccrual 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.

The composition of the loan portfolio was as follows:

In all cases, loans are placed

on nonaccrual or charged-off at an earlier date if collection of principal or interest is considered doubtful.

Nonaccrual 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.

Kentucky First Federal Bancorp

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2024

Loans receivable (continued)

All interest accrued but not received for loans

placed on nonaccrual is reversed against interest income.

Interest received on such loans is accounted for on the cash-basis or cost-recovery

method, until qualifying for return to accrual.

Loans are returned to accrual status when all the principal and interest amounts contractually

due are brought current and future payments are reasonably assured.

The composition of the loan portfolio was as

September 30,

(in thousands)

2 unchanged sentences

Nonresidential real estate

Commercial nonmortgage

Commercial and industrial

Consumer and other:

2 unchanged sentences

The amounts above include net deferred loan costs

of $ 312,000 and $ 330,000 as of March 31, 2024 and June 30, 2023, respectively.

of $ 259,000 and $ 288,000 as of September 30, 2024 and June 30, 2024, respectively.

Kentucky First Federal Bancorp

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2024

Loans receivable (continued)

The allowance for credit losses is a valuation

3 unchanged sentences

Management estimates the allowance balance required

using relevant available information, from internal and external sources, relating to past events, current conditions and reasonable and

supportable forecasts.

Historical credit loss experience, derived from the Company’s data, provides the basis for estimation of

expected credit losses, although management also compares the Company’s data with peer group data.

Adjustments to historical loss

information may be made for differences in:

using relevant available information, from internal and external sources, relating to past events, current conditions and reasonable

and supportable forecasts.

Historical credit loss experience, derived from the Company’s data, provides the basis for estimation

of expected credit losses, although management also compares the Company’s data with peer group data.

Adjustments to historical

loss information may be made for differences in:

lending policy, procedures and practice;

economic conditions;

the nature and volume of the

loan portfolio;

the nature and volume

of the loan portfolio;

volume delinquent and problem loans;

the current and anticipated economic conditions in the primary lending area;

other external factors.

Allocations of the allowance may be made for specific loans, but the entire allowance is available for any loan

that, in management’s judgment, should be charged off.

Loans that do not share risk characteristics are

evaluated on an individual basis.

and other external factors.

Allocations of the allowance may be made for specific loans, but the entire allowance is available for any

loan that, in management’s judgment, should be charged off.

Loans that do not share risk characteristics

are evaluated on an individual basis.

Loans evaluated individually are not included in the pool evaluation.

When management determines that

foreclosure is probable or when the borrower is experiencing financial difficulty at the reporting date and repayment is expected to be

provided substantially through the sale of the collateral, the expected credit losses are based on the fair value of the collateral at

the reporting date, less any discounts and selling costs.

When management determines

that foreclosure is probable or when the borrower is experiencing financial difficulty at the reporting date and repayment is expected

to be provided substantially through the sale of the collateral, the expected credit losses are based on the fair value of the collateral

at the reporting date, less any discounts and selling costs.

Management monitors loan performance on a monthly

basis and performs a quarterly evaluation of the adequacy of the ACL.

The Banks begin enhanced monitoring of all loans rated 5-Watch or

worse and obtain a new appraisal or asset valuation for most loans placed on nonaccrual status.

The Banks begin enhanced monitoring of all loans rated 5-Watch

or worse and obtain a new appraisal or asset valuation for most loans placed on nonaccrual status.

New appraisals are usually not obtained

10 unchanged sentences

Management monitors the adequacy of the ACL on an ongoing basis and reports its adequacy quarterly to the Board of Directors.

believes the ACL at March 31, 2024 is adequate.

Management believes the ACL at September 30, 2024 is adequate.

Kentucky First Federal Bancorp

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

Loans receivable

September 30, 2024

Loans receivable (continued)

Expected credit losses are estimated over the

13 unchanged sentences

on the payment status of the loans.

Nonperforming consumer loans are loans that are nonaccrual or 90 days or more past due and still accruing.

Nonperforming consumer loans are loans that are nonaccrual or 90 days or more past due and still

Our portfolio segments include residential real

12 unchanged sentences

of the value with private mortgage insurance.

Alternatively, the borrower may be able to borrow up to 90 % of the value through other programs

offered by the bank.

We offer loans on one- to four-family rental properties

at a maximum of 80 % loan-to-value (“LTV”) ratio and we generally charge a slightly higher interest rate on such loans.

Alternatively, the borrower may be able to borrow up to 90 % of the value through other

programs offered by the bank.

We offer loans on one- to four-family rental

properties at a maximum of 80 % loan-to-value (“LTV”) ratio and we generally charge a slightly higher interest rate on such

We also originate loans to individuals to finance

the construction of residential dwellings for personal use or for use as rental property.

We lend to builders for construction of speculative

or custom residential properties for resale.

Construction loans are generally less than one year in length, do not exceed 80 % of the appraised

value, and provide for the payment of interest only during the construction phase.

Funds are disbursed as progress is made toward completion

of the construction.

We occasionally lend to builders for construction

of speculative or custom residential properties for resale, but on a limited basis.

Construction loans are generally less than one year

in length, do not exceed 80 % of the appraised value, and provide for the payment of interest only during the construction phase.

are disbursed as progress is made toward completion of the construction.

Multi-family Loans

1 unchanged sentence

multi-family (five or more units).

Generally, these loans are originated for 25 years or less and do not exceed 80 % of the appraised value.

Generally, these loans are originated for 25 years or less and do not exceed 80 % of the appraised

Loans secured by multi-family generally have larger balances and involve a greater degree of risk than one- to four-family residential

6 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

Loans receivable

September 30, 2024

Loans receivable (continued)

Nonresidential Loans

3 unchanged sentences

are originated for 25 years or less and do not exceed 80 % of the appraised value.

As with multi-family loans, commercial real estate loans

generally have larger balances and involve a greater degree of risk than one- to four-family residential mortgage loans and these loans

depend on the borrower’s creditworthiness, as well as the feasibility and cash flow potential of the project.

Payments on loans

secured by nonresidential properties often depend on successful operation and management of the properties.

As a result, repayment on

such loans may be subject to a greater extent to adverse conditions in the real estate market or economy than owner-occupied residential

As with multi-family loans, commercial real estate

loans generally have larger balances and involve a greater degree of risk than one- to four-family residential mortgage loans and these

loans depend on the borrower’s creditworthiness, as well as the feasibility and cash flow potential of the project.

loans secured by nonresidential properties often depend on successful operation and management of the properties.

As a result, repayment

on such loans may be subject to a greater extent to adverse conditions in the real estate market or economy than owner-occupied residential

Consumer lending

Our consumer loans include home equity lines of

credit, loans secured by savings deposits, automobile loans, and unsecured loans.

Home equity loans are generally second mortgage loans

subordinate only to first mortgages also held by the bank and do not exceed 80 % of the estimated value of the property.

We do offer home

equity loans up to 90 % of the estimated value to qualified borrowers and these loans carry a premium interest rate.

Loans secured by savings

are originated up to 90 % of the depositor’s savings account balance and bear interest at a rate higher than the rate paid on the

deposit account.

Because the deposit account must be pledged as collateral to secure the loan, the inherent risk of this type of loan

Loans secured by automobiles are made directly to consumers (there are no relationships with dealers) and are based on the

value of the vehicle and the borrower’s creditworthiness.

Vehicle loans present a higher level of risk because of the natural decline

in the value of the property as well as its mobility.

Unsecured loans are based entirely on the borrower’s creditworthiness and

present the highest level of risk to the bank.

Our consumer loans include home equity lines

of credit, loans secured by savings deposits, automobile loans, and unsecured loans.

Home equity loans are generally second mortgage

loans subordinate only to first mortgages also held by the bank and do not exceed 80 % of the estimated value of the property.

home equity loans up to 90 % of the estimated value to qualified borrowers and these loans carry a premium interest rate.

Loans secured

by savings are originated up to 90 % of the depositor’s savings account balance and bear interest at a rate higher than the rate

paid on the deposit account.

Because the deposit account must be pledged as collateral to secure the loan, the inherent risk of this

type of loan is minimal.

Loans secured by automobiles are made directly to consumers (there are no relationships with dealers) and are

based on the value of the vehicle and the borrower’s creditworthiness.

Vehicle loans present a higher level of risk because of

the natural decline in the value of the property as well as its mobility.

Unsecured loans are based entirely on the borrower’s

creditworthiness and present the highest level of risk to the bank.

Impaired loans

The Banks choose the most appropriate method for

accounting for impaired loans.

For secured loans, which make up the vast majority of the loans in the Banks’ portfolio, this method

involves determining the fair value of the collateral, reduced by estimated selling costs.

Where appropriate, the Banks would account

for impaired loans by determining the present value of expected future cash flows discounted at the loan’s effective interest rate.

A loan is considered impaired when, based on current

information and events, it is probable that a creditor will be unable to collect all amounts due according to the contractual terms of

the loan agreement.

Although most of our loans are secured by collateral, we rely heavily on the capacity of our borrowers to generate

sufficient cash flow to service their debt.

As a result, our loans do not become collateral-dependent until there is deterioration in

the borrower’s cash flow and financial condition, which makes it necessary for us to look to the collateral for our sole source

The Banks choose the most appropriate method

for accounting for impaired loans.

For secured loans, which make up the vast majority of the loans in the Banks’ portfolio, this

method involves determining the fair value of the collateral, reduced by estimated selling costs.

Where appropriate, the Banks would

account for impaired loans by determining the present value of expected future cash flows discounted at the loan’s effective interest

A loan is considered impaired when, based on

current information and events, it is probable that a creditor will be unable to collect all amounts due according to the contractual

terms of the loan agreement.

Although most of our loans are secured by collateral, we rely heavily on the capacity of our borrowers to

generate sufficient cash flow to service their debt.

As a result, our loans do not become collateral-dependent until there is deterioration

in the borrower’s cash flow and financial condition, which makes it necessary for us to look to the collateral for our sole source

of repayment.

Collateral-dependent loans which are more than ninety days delinquent are considered to constitute more than a minimum delay

in repayment and are evaluated for impairment under the policy at that time.

We utilize updated independent appraisals to determine

fair value for collateral-dependent loans, adjusted for estimated selling costs, in determining our specific reserve.

In some situations,

management does not secure an updated independent appraisal.

These situations may involve small loan amounts or loans that, in management’s

opinion, have an abnormally low loan-to-value ratio.

Collateral-dependent loans which are more than ninety days delinquent are considered to constitute more than a minimum

delay in repayment and are evaluated for impairment under the policy at that time.

We utilize updated independent appraisals to

determine fair value for collateral-dependent loans, adjusted for estimated selling costs, in determining our specific reserve.

situations, management does not secure an updated independent appraisal.

These situations may involve small loan amounts or loans that,

in management’s opinion, have an abnormally low loan-to-value ratio.

With respect to the Banks’ investment in

6 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

Loans receivable

The following table presents the activity in the

ACL by portfolio segment for the nine months ended March 31, 2024, after restatement of beginning balance for adoption of ASC 326:

March 31, 2024:

September 30, 2024

Loans receivable (continued)

The following table presents the activity in

the ACL by portfolio segment for the three months ended September 30, 2024.

September 30, 2024:

(in thousands)

(recovery of)

credit losses

Credit Losses for Unfunded

for (recovery of) credit losses on loans

Residential real estate

4 unchanged sentences

Loans on deposits

For the nine months ended March 31, 2024,

the provision for (recovery of) credit losses totaled $( 16,000 ) including $ 13,000 of recovery on credit losses on loans and $ 3,000 recovery on credit losses on unfunded commitments.

At March 31, 2024, the allowance for credit losses on unfunded

commitments totaled $ 57,000 .

The following table presents the activity in the

ALLL by portfolio segment for the nine months ended March 31, 2023:

(in thousands)

Residential real estate:

One-to four-family

Nonresidential real estate

Commercial nonmortgage

Consumer and other:

Loans on deposits

Kentucky First Federal Bancorp

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2023

Loans receivable

The following table presents the activity in the

allowance for credit losses by portfolio segment for the three months ended March 31, 2024:

(in thousands)

(recovery of) credit

Residential real estate:

One- to four-family

Nonresidential real estate

Commercial nonmortgage

Consumer and other:

Loans on deposits

The following table presents the activity in the

allowance for loan losses by portfolio segment for the three months ended March 31, 2023:

ACL by portfolio segment for the three months ended September 30, 2023 after restatement of beginning balance for adoption of ASC 326:

September 30, 2023:

(in thousands)

for (recovery of) credit losses on loans

Residential real estate

1 unchanged sentence

Nonresidential real estate

Commercial nonmortgage

Commercial and industrial

Consumer and other

2 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

September 30, 2024

Loans receivable (continued)

The following table presents the amortized cost

basis of collateral-dependent loans by portfolio class as of March 31, 2024.

basis of collateral-dependent loans by portfolio class as of September 30, 2024.

The recorded investment in loans excludes accrued interest

receivable due to immateriality.

March 31, 2024:

September 30, 2024:

(in thousands)

7 unchanged sentences

evaluated for impairment.

The following tables present the balance in the

ALLL and the recorded investment in loans by portfolio class and based on impairment method as of March 31, 2024.

March 31, 2024:

The following table presents the amortized cost

basis of collateral-dependent loans by portfolio class as of June 30, 2024.

The recorded investment in loans excludes accrued interest

receivable due to immateriality.

June 30, 2024:

(in thousands)

Loans acquired

credit quality*

attributed to

Amortized Cost

Loans individually evaluated for impairment:

2 unchanged sentences

Nonresidential real estate

Loans collectively evaluated for impairment:

Residential real estate

One- to four-family

Nonresidential real estate

Commercial and industrial

Consumer and other

Loans on deposits

* These loans were evaluated at acquisition date at their estimated fair value and there has been no subsequent deterioration since acquisition.

Kentucky First Federal Bancorp

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

September 30, 2024

Loans receivable (continued)

The following tables present the balance in the

allowance for loan losses and the recorded investment in loans by portfolio class and based on impairment method as of June 30, 2023.

The following table presents the recorded investment

in nonaccrual and loans past due over 90 days still on accrual by class of loans as of September 30, 2024, and June 30, 2024:

September 30, 2024

June 30, 2024

(in thousands)

Loans acquired

credit quality*

attributed to

Loans individually evaluated for impairment:

Residential real estate

1 unchanged sentence

Nonresidential real estate

Loans collectively evaluated for impairment:

Residential real estate

One- to four-family

Nonresidential real estate

Commercial and industrial

Consumer and other

Loans on deposits

These loans were evaluated at acquisition date at their estimated fair value and there has been no subsequent deterioration since acquisition.

Kentucky First Federal Bancorp

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

Loans receivable (continued)

The following table presents interest income on

loans individually evaluated for impairment by class of loans for the nine months ended March 31:

(in thousands)

With no related allowance recorded:

One- to four-family

Nonresidential real estate

Purchased credit-impaired loans

With an allowance recorded:

One- to four-family

The following

table presents interest income on loans individually evaluated for impairment by class of loans for the three months ended March 31:

(in thousands)

Income Recognized

With no related allowance recorded:

Residential real estate:

One- to four-family

Nonresidential real estate

Purchased credit-impaired loans

With an allowance recorded:

One- to four-family

Kentucky First Federal Bancorp

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

Loans receivable (continued)

The following table presents the recorded investment

in nonaccrual and loans past due over 90 days still on accrual by class of loans as of March 31, 2024 and June 30, 2023:

March 31, 2024

June 30, 2023

(in thousands)

Past Due Over

90 Days Still

Past Due Over

90 Days Still

Residential real estate:

One- to four-family residential real estate

Nonresidential real estate and land

Nonaccrual loans had no related allowance for

credit losses based on individual evaluation at September 30, 2024 or June 30, 2024.

One- to four-family loans in process of foreclosure

totaled $ 1.2 million and $ 766,000 at March 31, 2024 and June 30, 2023, respectively.

Troubled Debt Restructurings:

Prior to the adoption of ASC 326 a Troubled Debt

Restructuring (“TDR”) was the situation where the Bank granted a concession to the borrower that the Banks would not otherwise

have considered due to the borrower’s financial difficulties.

All TDRs are considered “impaired.”

At June 30, 2023, the Company had $ 1.4 million

of loans classified as TDRs.

During the nine months ended March 31, 2024 there were no loans modified

to borrowers experiencing financial difficulty.

totaled $ 883,000 and $ 926,000 at September 30, 2024 and June 30, 2024, respectively.

The above total for loans in process of foreclosure

at September 30, 2024 included a loan of $ 758,462 in foreclosure that was subsequently paid in full, along with past due interest and

fees, on October 22, 2024.

There were no loans modified during the three

months ended September 30, 2024 to borrowers experiencing financial difficulties.

The following table presents the aging of the

principal balance outstanding in past due loans as of March 31, 2024, by class of loans:

principal balance outstanding in past due loans as of September 30, 2024, by class of loans:

September 30, 2024:

(in thousands)

2 unchanged sentences

Nonresidential real estate

Commercial non-mortgage

Commercial and industrial

Consumer and other

2 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

Loans receivable

September 30, 2024

Loans receivable (continued)

The following tables present the aging of the

33 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

September 30, 2024

Loans receivable (continued)

4 unchanged sentences

See the aging of past due loan

As of March 31, 2024, and based on the most recent analysis performed, the risk category of loans by class of loans is as

As of September 30, 2024, and based on the most recent analysis performed, the risk category of loans by class of loans is

(in thousands)

Term Loans Amortized Cost by Origination Fiscal Year

As of March 31, 2024

As of September 30, 2024

Residential real estate:

26 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

September 30, 2024

Loans receivable (continued)

At March 31, 2024, the risk category of loans

As of June 30, 2024, and based on the most recent

analysis performed, the risk category of loans by class of loans is as follows:

(in thousands)

Term Loans Amortized Cost by Origination Fiscal Year

As of June 30, 2024

Residential real estate:

One- to four-family

Special mention

Current period gross charge offs

Special mention

Current period gross charge offs

Special mention

Current period gross charge offs

Special mention

Current period gross charge offs

Special mention

Current period gross charge offs

Nonresidential real estate

Special mention

Current period gross charge offs

Commercial and industrial

Special mention

Current period gross charge offs

Special mention

Current period gross charge offs

Special mention

Current period gross charge offs

Special mention

Current period gross charge offs

Special mention

Current period gross charge offs

Kentucky First Federal Bancorp

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2024

Loans receivable (continued)

At September 30, 2024, the risk category of loans

by class of loans was as follows:

3 unchanged sentences

Nonresidential real estate

Commercial nonmortgage

Commercial and industrial

Consumer and other

Loans on deposits

13 unchanged sentences

The carrying amount of those loans, net of a purchase credit discount

of $ 88,000 and $ 88,000 at March 31, 2024 and June 30, 2023, respectively, is as follows:

of $ 25,000 and $ 25,000 at September 30, 2024 and June 30, 2024, respectively, is as follows:

(in thousands)

September 30,

One- to four-family residential real estate

2 unchanged sentences

(in thousands)

September 30,

Twelve months

3 unchanged sentences

For those purchased loans disclosed above, the

Company made no increase in allowance for loan losses for the year ended June 30, 2023, nor for the nine-month period ended March 31,

Company made no increase in allowance for loan losses for the year ended June 30, 2024, nor for the three-month period ended September

Neither were any allowance for loan losses reversed during those periods.

1 unchanged sentence

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

September 30, 2024

Disclosures About Fair Value of Assets

28 unchanged sentences

Quoted Prices

March 31, 2024

September 30, 2024

Agency mortgage-backed:

2 unchanged sentences

There were no assets or liabilities which were

measured at fair value on a nonrecurring basis at March 31, 2024, and June 30, 2023.

measured at fair value on a nonrecurring basis at September 30, 2024, and June 30, 2024.

The following is a disclosure of the fair value

9 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

September 30, 2024

Disclosures About Fair Value of Assets

1 unchanged sentence

Based on the foregoing methods and assumptions,

the carrying value and fair value of the Company’s financial instruments at March 31, 2024 and June 30, 2023 are as follows:

the carrying value and fair value of the Company’s financial instruments at September 30, 2024 and June 30, 2024 are as follows:

Fair Value Measurements at

March 31, 2024 Using

September 30, 2024 Using

(in thousands)

26 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

September 30, 2024

Other Comprehensive Income (Loss)

The Company’s other comprehensive loss is

comprised solely of unrealized gains and losses on available-for-sale securities.

The following is a summary of the accumulated other

comprehensive loss balances, net of tax:

The Company’s other comprehensive income

(loss) is comprised solely of unrealized gains and losses on available-for-sale securities.

The following is a summary of the accumulated

other comprehensive income balances, net of tax:

(in thousands)

Nine months ended

Three months ended

Balance at beginning of period

Current period change

Balance at end of period

September 30,

Beginning balance

Current year change

Ending balance

Other comprehensive income (loss) components and

related tax effects for the periods indicated were as follows:

Nine months ended

Three months ended

September 30,

(in thousands)

Unrealized holding gains (losses) on available-for-sale securities

Kentucky First Federal

Net-of-tax amount

Formal Written Agreement

Kentucky First Federal Bancorp

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements