11 unchanged sentences
government agency MBS and U.S.
−Removed: government sponsored enterprise MBS with contractual maturities of up to 30 years that reprice frequently or have a relatively short-average life.
−Removed: The Corporation relies on retail deposits as its primary source of funds while utilizing FHLB - San Francisco advances as a secondary source of funding.
+Added: government sponsored enterprise MBS and CMOs with contractual maturities of up to 30 years that reprice frequently or have a relatively short-average life.
+Added: The Corporation relies on retail deposits as its primary source of funds while utilizing FHLB - San Francisco
+Added: advances as a secondary source of funding.
Management believes retail deposits, unlike brokered deposits, reduce the effects of interest rate fluctuations because they generally represent a more stable source of funds.
24 unchanged sentences
Change in NPV Ratio
−Removed: The pre-shock NPV ratio increased 61 basis points to 12.54 percent at June 30, 2021 from 11.93 percent at June 30, 2020 and the post-shock NPV ratio increased 68 basis points to 11.25 percent at June 30, 2021 from 10.57 percent at June 30, 2020.
−Removed: The increase of the NPV ratios was primarily attributable to the net income in fiscal 2021, amortization of stock-based compensation expense and exercise of stock options, partly offset by a $5.0 million cash dividend distribution from the Bank to the Corporation in September 2020 and stock repurchases.
+Added: The pre-shock NPV ratio decreased 367 basis points to 8.87 percent at June 30, 2022 from 12.54 percent at June 30, 2021 and the post-shock NPV ratio decreased 271 basis points to 8.54 percent at June 30, 2022 from 11.25 percent at June 30, 2021.
+Added: The decrease of the NPV ratios was primarily attributable to increases in market interest rates and a $7.5 million cash dividend distribution from the Bank to the Corporation in September 2021, partly offset by the net income in fiscal 2022 and amortization of stock-based compensation expense.
As with any method of measuring interest rate risk, certain shortcomings are inherent in the method of analysis presented in the foregoing tables.
3 unchanged sentences
Further, in the event of a change in interest rates, expected rates of prepayments on loans and early withdrawals from time deposits could likely deviate significantly from those assumed when calculating the results described in the tables above.
−Removed: It is also possible that, as a result of an interest rate increase, the higher mortgage payments required from ARM borrowers could result in an increase in delinquencies and defaults.
+Added: It is also possible that,
+Added: as a result of an interest rate increase, the higher mortgage payments required from ARM borrowers could result in an increase in delinquencies and defaults.
Accordingly, the data presented in the tables in this section should not be relied upon as indicative of actual results in the event of changes in interest rates.
36 unchanged sentences
Interest-bearing checking deposits are considered more sensitive, followed by increased sensitivity for savings and money market deposits.
−Removed: For the purpose of calculating gap, a portion of these interest-
−Removed: bearing deposit balances are assumed to be subject to estimated repricing as follows:
+Added: For the purpose of calculating gap, a portion of these interest-bearing deposit balances are assumed to be subject to estimated repricing as follows:
interest-bearing checking deposits at 15% per year, savings deposits at 20% per year and money market deposits at 50% in the first and second years.
13 unchanged sentences
● Loan prepayment estimates for each type of loan;
−Removed: ● Immediate, permanent and parallel movements in interest rates of plus 300, 200 and 100 and minus 100 basis points.
+Added: ● Immediate, permanent and parallel movements in interest rates of plus 300, 200 and 100, minus 100 and minus 200 basis points.
The following table describes the results of the analysis at June 30, 2022 and 2021:
9 unchanged sentences
Therefore, in a rising interest rate environment, the model projects an increase in net interest income over the subsequent 12-month period.
−Removed: In a falling interest rate environment, the results project a decrease in net interest income over the subsequent 12-month period, except for minus 100 basis-point scenario at June 30, 2021.
+Added: In a falling interest rate environment, the results project a decrease in net interest income over the subsequent 12-month period, except for the -100 and -200 basis point scenarios at June 30, 2021.
Management believes that the assumptions used to complete the analysis described in the table above are reasonable.
−Removed: However, past experience has shown that immediate, permanent and parallel movements in interest rates will not necessarily occur.
+Added: However, past experience has shown that immediate, permanent and parallel movements in interest rates will not
+Added: necessarily occur.
Additionally, while the analysis provides a tool to evaluate the projected net interest income to changes in interest rates, actual results may be substantially different if actual experience differs from the assumptions used to complete the analysis, particularly with respect to the 12-month business plan when asset growth is forecast.
4 unchanged sentences
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.