COMMITMENTS AND CONTINGENCIES

6 Months Ended

Dec. 31, 2014

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

Credit-Related Financial Instruments. The Company is a party to credit-related financial instruments with off-balance-sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments are commitments to extend credit. Such commitments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the consolidated balance sheets.

The Company’s exposure to credit loss is represented by the contractual amount of these commitments. The Company follows the same credit policies in making commitments as it does for on-balance-sheet instruments.

At December 31, 2014, the Company had commitments to originate $37,929 in fixed rate loans and $110,617 in variable rate loans, totaling an aggregate outstanding principal balance of $148,546. Our fixed rate loan commitments to originate had rates ranging from 2.88% to 8.32%. At December 31, 2014, the Company also had commitments to sell $46,199 in fixed rate loans and $7,283 in variable rate loans, totaling an aggregate outstanding principal balance of $53,482.

Commitments to extend credit are agreements to lend to a customer so long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. The commitments for equity lines of credit may expire without being drawn upon. Therefore, the total commitment amounts do not necessarily represent future cash requirements. The amount of collateral obtained, if it is deemed necessary by the Company, is based on management’s credit evaluation of the customer.

Deposits. The Bank entered into a purchase and assumption agreement to assume approximately $125,000 of FDIC-insured deposits including individual checking, money market savings, and CD accounts. Under the Agreement, the Bank will receive approximately $125,000 in cash at the closing date and will assume deposits at par with no purchase premium. The deposit transfer transaction is subject to prior approval by the Office of the Comptroller of the Currency and to other standard closing conditions. The closing of the transaction is targeted for the second calendar quarter of fiscal 2015.