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LOANS RECEIVABLE, NET (Tables)

12 Months Ended

Sep. 30, 2021

Loans receivable are comprised of the following:

	September 30,
	2021			2020
	(In thousands)

One-to four-family residential	$	203,019		$	210,360
Commercial real estate		280,848			248,134
Construction		20,350			28,242
Home equity lines of credit		17,930			19,373
Commercial business		68,719			100,993
Other		3,751			4,157
Total loans receivable		594,617			611,259
Net deferred loan costs		(1,241	)		(1,749	)
Allowance for loan losses		(8,075	)		(6,400	)

Total loans receivable, net	$	585,301		$	603,110

Schedule of impaired loans

The following table presents impaired loans by class, segregated by those for which a specific allowance was required and those for which a specific allowance was not necessary for the periods presented:

					Impaired Loans
	Impaired Loans with				with No Specific
	Specific Allowance				Allowance		Total Impaired Loans
									Unpaid
At and for the year ended	Recorded		Related		Recorded		Recorded		Principal
September 30, 2021	Investment		Allowance		Investment		Investment		Balance
	(In thousands)

One-to four-family residential	$	—	$	—	$	2,711	$	2,711	$	2,711
Commercial real estate		—		—		2,270		2,270		2,270
Construction		2,835		224		1,745		4,580		4,645
Commercial business		—		—		1,507		1,507		1,507
Total impaired loans	$	2,835	$	224	$	8,233	$	11,068	$	11,133

					Impaired Loans
	Impaired Loans with				with No Specific
	Specific Allowance				Allowance		Total Impaired Loans
									Unpaid
At and for the year ended	Recorded		Related		Recorded		Recorded		Principal
September 30, 2020	Investment		Allowance		Investment		Investment		Balance
	(In thousands)

One-to four-family residential	$	—	$	—	$	2,601	$	2,601	$	2,601
Commercial real estate		599		46		3,806		4,405		4,405
Construction		2,306		175		2,835		5,141		5,206
Commercial business		—		—		2,014		2,014		2,218
Total impaired loans	$	2,905	$	221	$	11,256	$	14,161	$	14,430

Schedule of loan portfolio summarized by Bank's internal risk rating system

The following tables present the classes of the loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard and Doubtful within the Bank’s internal risk rating system for the periods presented:

			Special
	Pass		Mention		Substandard		Doubtful		Total
	(In thousands)
September 30, 2021
One-to four-family residential	$	200,510	$	1,002	$	1,507	$	—	$	203,019
Commercial real estate		272,408		6,679		1,761		—		280,848
Construction		15,770		—		4,580		—		20,350
Home equity lines of credit		17,930		—		—		—		17,930
Commercial business		67,360		10		1,349		—		68,719
Other		3,751		—		—		—		3,751
Total	$	577,729	$	7,691	$	9,197	$	—	$	594,617

			Special
	Pass		Mention		Substandard		Doubtful		Total
	(In thousands)
September 30, 2020
One-to four-family residential	$	208,658	$	—	$	1,702	$	—	$	210,360
Commercial real estate		242,003		2,623		3,508		—		248,134
Construction		23,101		—		5,141		—		28,242
Home equity lines of credit		19,373		—		—		—		19,373
Commercial business		98,967		178		1,848		—		100,993
Other		4,157		—		—		—		4,157
Total	$	596,259	$	2,801	$	12,199	$	—	$	611,259

Schedule of aging analysis of past due loans, segregated by class of loans

Management further monitors the performance and credit quality of the loan portfolio by analyzing the age of the portfolio as determined by the length of time a recorded payment is past due. The following tables present the classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans for the periods presented:

			30-59		60-89
			Days		Days		90 Days +		Total		Non-		Total
	Current		Past Due		Past Due		Past Due		Past Due		Accrual		Loans
	(In thousands)
September 30, 2021
One-to four-family residential	$	201,868	$	—	$	—	$	1,151	$	1,151	$	1,151	$	203,019
Commercial real estate		279,769		—		—		1,079		1,079		1,079		280,848
Construction		15,770		—		—		4,580		4,580		4,580		20,350
Home equity lines of credit		17,930		—		—		—		—		—		17,930
Commercial business		67,370		—		—		1,349		1,349		1,349		68,719
Other		3,751		—		—		—		—		—		3,751
Total	$	586,458	$	—	$	—	$	8,159	$	8,159	$	8,159	$	594,617

Table of Contents

MAGYAR BANCORP, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

September 30, 2021 and 2020

			30-59		60-89
			Days		Days		90 Days +		Total		Non-		Total
	Current		Past Due		Past Due		Past Due		Past Due		Accrual		Loans
	(In thousands)
September 30, 2020
One-to four-family residential	$	209,455	$	—	$	—	$	905	$	905	$	905	$	210,360
Commercial real estate		245,029		—		886		2,219		3,105		2,219		248,134
Construction		23,101		—		—		5,141		5,141		5,141		28,242
Home equity lines of credit		19,373		—		—		—		—		—		19,373
Commercial business		99,397		—		129		1,467		1,596		1,467		100,993
Other		4,157		—		—		—		—		—		4,157
Total	$	600,512	$	—	$	1,015	$	9,732	$	10,747	$	9,732	$	611,259

Schedule of activity in the allowance for loan losses by portfolio segment

The following tables summarize the activity in the allowance for loan losses by loan category for the years ended September 30, 2021 and 2020:

	One-to-Four								Home Equity
	Family		Commercial						Lines of		Commercial
	Residential		Real Estate			Construction			Credit		Business		Other			Unallocated		Total
	(In thousands)

Balance-September 30, 2020	$	1,035	$	3,232		$	672		$	179	$	1,034	$	1		$	247	$	6,400
Charge-offs		—		(51	)		—			—		—		(1	)		—		(52	)
Recoveries		1		—			—			1		96		—			—		98
Provision (credit)		100		563			(78	)		52		916		15			61		1,629
Balance-September 30, 2021	$	1,136	$	3,744		$	594		$	232	$	2,046	$	15		$	308	$	8,075

	One-to-Four							Home Equity
	Family		Commercial					Lines of		Commercial
	Residential		Real Estate		Construction			Credit		Business			Other			Unallocated			Total
	(In thousands)

Balance-September 30, 2019	$	731	$	2,066	$	511		$	138	$	1,184		$	8		$	250		$	4,888
Charge-offs		—		—		(65	)		—		(204	)		—			—			(269	)
Recoveries		11		5		—			—		99			—			—			115
Provision (credit)		293		1,161		226			41		(45	)		(7	)		(3	)		1,666
Balance-September 30, 2020	$	1,035	$	3,232	$	672		$	179	$	1,034		$	1		$	247		$	6,400

The following tables summarize the ALL by loan category, segregated into the amount required for loans individually evaluated for impairment and the amount required for loans collectively evaluated for impairment as of September 30, 2021 and September 30, 2020:

	One-to- Four						Home Equity
	Family		Commercial				Lines of		Commercial
	Residential		Real Estate		Construction		Credit		Business		Other		Unallocated		Total
	(In thousands)
Allowance for Loan Losses:
Balance - September 30, 2021	$	1,136	$	3,744	$	594	$	232	$	2,046	$	15	$	308	$	8,075
Individually evaluated
for impairment		—		—		224		—		—		—		—		224
Collectively evaluated
for impairment		1,136		3,744		370		232		2,046		15		308		7,851

Loans receivable:
Balance - September 30, 2021	$	203,019	$	280,848	$	20,350	$	17,930	$	68,719	$	3,751	$	—	$	594,617
Individually evaluated
for impairment		2,711		2,270		4,580		—		1,507		—		—		11,068
Collectively evaluated
for impairment		200,308		278,578		15,770		17,930		67,212		3,751		—		583,549

Table of Contents

MAGYAR BANCORP, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

September 30, 2021 and 2020

	One-to- Four						Home Equity
	Family		Commercial				Lines of		Commercial
	Residential		Real Estate		Construction		Credit		Business		Other		Unallocated		Total
	(In thousands)
Allowance for Loan Losses:
Balance - September 30, 2020	$	1,035	$	3,232	$	672	$	179	$	1,034	$	1	$	247	$	6,400
Individually evaluated
for impairment		—		46		175		—		—		—		—		221
Collectively evaluated
for impairment		1,035		3,186		497		179		1,034		1		247		6,179

Loans receivable:
Balance - September 30, 2020	$	210,360	$	248,134	$	28,242	$	19,373	$	100,993	$	4,157	$	—	$	611,259
Individually evaluated
for impairment		2,601		4,405		5,141		—		2,014		—		—		14,161
Collectively evaluated
for impairment		207,759		243,729		23,101		19,373		98,979		4,157		—		597,098

Schedule of troubled debt restructurings

There were two TDR loans during the year ended September 30, 2021 and one TDR loan during the year ended September 30, 2020. All TDR loans were performing in accordance with their restructured terms as September 30, 2021. The following tables summarizes the TDRs during the years ended September 30, 2021 and 2020:

	Number of		Investment Before		Investment After
	Loans		TDR Modification		TDR Modification
September 30, 2021	(Dollars in thousands)
One-to four-family residential		2	$	330	$	340

Total		2	$	330	$	340

	Number of		Investment Before		Investment After
	Loans		TDR Modification		TDR Modification
September 30, 2020	(Dollars in thousands)
Commercial business		1	$	252	$	220

Total		1	$	252	$	220

Schedule of actaul loan modifications

The Company offered loan payment deferrals to borrowers affected by COVID-19. Loan payment deferral requests were considered on a case-by-case basis and were approved for up to a six month period for principal and interest payments or for interest only payments, depending on the borrower’s circumstances. Through September 30, 2021, the Company had modified 284 loans aggregating $150.9 million for the deferral of principal and/or interest payments. Of these loans, at September 30, 2021, 227 loans aggregating $121.4 million had resumed making their contractual loan payments, 56 loans totaling $28.1 million repaid their deferred payments, and one loan totaling $1.4 million was delinquent more than 90 days and in the process of foreclosure. Details with respect to those loans that did not pay off or fully pay the deferred payments for the year ended September 30, 2021 and 2020 are as follows:

Table of Contents

MAGYAR BANCORP, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

September 30, 2021 and 2020

September 30, 2021	Number of Loans		Balance		Weighted Average Interest Rate
	(Dollars in thousands)
One-to-four family residential real estate ⁽¹⁾		75	$	17,593	4.09	%
Commercial real estate		122		95,847	4.69	%
Construction		3		2,305	3.53	%
Home equity lines of credit		6		896	4.33	%
Commercial business		22		6,172	6.06	%
Total		228	$	122,813	4.65	%

September 30, 2020
One-to-four family residential real estate ⁽¹⁾	94	$	24,573	4.05	%
Commercial real estate	145		115,358	4.76	%
Construction	4		2,630	3.77	%
Home equity lines of credit	8		1,238	4.24	%
Commercial business	32		6,892	5.88	%
Total	283	$	150,691	4.67	%


	⁽¹⁾	Includes home equity loans.