	June 30,
	2021			2020
Mortgage loans:
Residential	$	224,305		$	255,382
Commercial		826,624			807,106
Construction		10,151			11,053
Net deferred loan origination costs		196			739
Total mortgages		1,061,276			1,074,280
Commercial and consumer loans:
Commercial loans⁽¹⁾		150,658			164,257
Home equity lines of credit		25,439			29,838
Consumer and overdrafts		345			481
Net deferred loan origination (fees) costs		(386	)		730
Total commercial and consumer loans		176,056			195,306
Total loans receivable		1,237,332			1,269,586
Allowance for loan losses		(7,881	)		(8,639	)
Loans receivable, net	$	1,229,451		$	1,260,947

⁽¹⁾ Includes PPP loans of $37.0 million and $49.6 million as of June 30, 2021 and 2020, respectively. No allowance for loan loss was established for these loans as they are fully guaranteed by the Small Business Administration.

The following tables present the activity in the allowance for loan losses by portfolio segment for the years ended June 30, 2021 and 2020 (in thousands):

	For the year ended June 30, 2021
	Beginning Allowance		Provision (Benefit)			Charge-offs			Recoveries		Ending Allowance
Residential mortgages	$	373	$	(53	)	$	-		$	17	$	337
Commercial mortgages		6,913		(478	)		-			-		6,435
Construction		165		(63	)		-			-		102
Commercial loans		1,124		(90	)		(258	)		172		948
Home equity lines of credit		60		(14	)		-			8		54
Consumer and overdrafts		4		25			(27	)		3		5
Total	$	8,639	$	(673	)	$	(285	)	$	200	$	7,881

	For the year ended June 30, 2020
	Beginning Allowance		Provision (Benefit)			Charge-offs			Recoveries		Ending Allowance
Residential mortgages	$	446	$	(51	)	$	(31	)	$	9	$	373
Commercial mortgages		3,853		2,935			-			125		6,913
Construction		159		6			-			-		165
Commercial loans		1,130		155			(181	)		20		1,124
Home equity lines of credit		65		(17	)		-			12		60
Consumer and overdrafts		11		36			(51	)		8		4
Total	$	5,664	$	3,064		$	(263	)	$	174	$	8,639

The following tables present the balance in the allowance for loan losses and the recorded investment in loans, excluding net deferred fees and accrued interest, by portfolio segment, and based on impairment method as of June 30, 2021 and 2020 (in thousands):

	June 30, 2021
	Loans								Allowance for loan losses
	Individually Evaluated for Impairment		Collectively Evaluated for Impairment		Acquired With Deteriorated Credit Quality		Total		Individually Evaluated for Impairment		Collectively Evaluated for Impairment		Acquired With Deteriorated Credit Quality		Total
Residential mortgages	$	2,356	$	221,229	$	720	$	224,305	$	113	$	224	$	-	$	337
Commercial mortgages		3,582		822,154		888		826,624		-		6,435		-		6,435
Construction		-		10,151		-		10,151		-		102		-		102
Commercial loans		1,707		148,951		-		150,658		-		948		-		948
Home equity lines of credit		414		24,902		123		25,439		8		46		-		54
Consumer and overdrafts		-		345		-		345		-		5		-		5
Total	$	8,059	$	1,227,732	$	1,731	$	1,237,522	$	121	$	7,760	$	-	$	7,881

	June 30, 2020
	Loans								Allowance for loan losses
	Individually Evaluated for Impairment		Collectively Evaluated for Impairment		Acquired With Deteriorated Credit Quality		Total		Individually Evaluated for Impairment		Collectively Evaluated for Impairment		Acquired With Deteriorated Credit Quality		Total
Residential mortgages	$	2,448	$	252,195	$	739	$	255,382	$	118	$	255	$	-	$	373
Commercial mortgages		-		806,224		882		807,106		-		6,913		-		6,913
Construction		-		11,053		-		11,053		-		165		-		165
Commercial loans		1,921		162,336		-		164,257		1		1,123		-		1,124
Home equity lines of credit		350		29,349		139		29,838		4		56		-		60
Consumer and overdrafts		-		481		-		481		-		4		-		4
Total	$	4,719	$	1,261,638	$	1,760	$	1,268,117	$	123	$	8,516	$	-	$	8,639

The following tables present information related to loans individually evaluated for impairment (excluding loans acquired with deteriorated credit quality) by class of loans as of and for the years ended June 30, 2021 and 2020 (in thousands):


	June 30, 2021						June 30, 2020
	Unpaid Principal Balance		Recorded Investment		Allowance for loan losses		Unpaid Principal Balance		Recorded Investment		Allowance for loan losses
With no related allowance recorded:
Residential mortgages	$	2,044	$	1,931	$	-	$	2,123	$	2,013	$	-
Commercial mortgages		3,582		3,582		-		-		-		-
Commercial loans		1,878		1,707		-		2,067		1,897		-
Home equity lines of credit		358		381		-		326		339		-
With an allowance recorded:
Residential mortgages		363		425		113		372		435		118
Commercial loans		-		-		-		24		24		1
Home equity lines of credit		33		33		8		11		11		4
Total	$	8,258	$	8,059	$	121	$	4,923	$	4,719	$	123

	For the year ended				For the year ended
	June 30, 2021				June 30, 2020
	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
Residential mortgages	$	1,930	$	38	$	2,149	$	48
Commercial mortgages		1,194		30		728		149
Commercial loans		1,769		191		2,163		205
Home equity lines of credit		384		1		468		15
With an allowance recorded:
Residential mortgages		430		14		375		14
Commercial loans		-		-		38		2
Home equity lines of credit		26		-		85		7
Total	$	5,733	$	274	$	6,006	$	440

The following table presents the recorded investment in nonaccrual loans and in loans past due over 90 days still on accrual status, by class of loans as of June 30, 2021 and 2020 (in thousands):

					Loans Past Due Over 90 Days
	Nonaccrual				and Still Accruing
	June 30,		June 30,		June 30,		June 30,
	2021		2020		2021		2020
Residential mortgages	$	1,391	$	1,457	$	-	$	-
Commercial mortgages		3,582		-		411		-
Home equity lines of credit		381		338		-		-
Total	$	5,354	$	1,795	$	411	$	-

Nonperforming loans include both smaller-balance homogeneous loans that are collectively evaluated for impairment and individually classified impaired loans. The table above excludes acquired loans that are accounted for as purchased credit impaired loans totaling $368,000 and $392,000 as of June 30, 2021 and 2020, respectively. Such loans are excluded because the loans are in pools that are considered performing. The discounts arising from recording these loans at fair value upon acquisition were due in part to credit quality and the accretable yield is being recognized as interest income over the life of the loans based on expected cash flows.

The following tables present the aging of the recorded investment in past due loans by class of loans as of June 30, 2021 and 2020 (in thousands):

	June 30, 2021
	30-59		60-89		90 Days or
	Days Past		Days Past		More Past		Total Past
	Due		Due		Due		Due		Current ⁽¹⁾		Total
Residential mortgages	$	198	$	126	$	948	$	1,272	$	223,033	$	224,305
Commercial mortgages		453		-		411		864		825,760		826,624
Construction		-		-		-		-		10,151		10,151
Commercial loans		69		76		-		145		150,513		150,658
Home equity lines of credit		-		19		381		400		25,039		25,439
Consumer and overdrafts		-		-		-		-		345		345
Total	$	720	$	221	$	1,740	$	2,681	$	1,234,841	$	1,237,522

	June 30, 2020
	30-59		60-89		90 Days or
	Days Past		Days Past		More Past		Total Past
	Due		Due		Due		Due		Current ⁽¹⁾		Total
Residential mortgages	$	495	$	10	$	806	$	1,311	$	254,071	$	255,382
Commercial mortgages		-		-		-		-		807,106		807,106
Construction		-		-		-		-		11,053		11,053
Commercial loans		76		-		-		76		164,181		164,257
Home equity lines of credit		44		-		338		382		29,456		29,838
Consumer and overdrafts		-		-		-		-		481		481
Total	$	615	$	10	$	1,144	$	1,769	$	1,266,348	$	1,268,117

The terms of certain loans were modified as troubled debt restructurings. The modification of the terms of such loans included one or a combination of the following: a reduction of the stated interest rate of the loan; an extension of the maturity date at a stated rate of interest lower than the current market rate for new debt with similar risk; or a permanent reduction of the recorded investment in the loan.

As of June 30, 2021 and 2020, the Company had 12 and 14 loans classified as troubled debt restructurings totaling $3.1 million and $3.3 million, respectively, including $2.7 million and $2.9 million, respectively, of loans still accruing. The Company has allocated $121,000 and $123,000, respectively, of specific reserves to customers whose loan terms have been modified in troubled debt restructurings as of June 30, 2021 and 2020. As of June 30, 2021 we have committed to lend an additional $3,000 to one customer with an outstanding loan that is classified as a troubled debt restructuring.

The Company did not modify any loans during the year ended June 30, 2021 that were classified as TDRs. The Company modified two commercial loans classified as troubled debt restructurings during the year ended June 30, 2020. These loans had a carrying amount as of June 30, 2020 of $195,000.

The Company had no troubled debt restructurings for which there was a payment default in the year ended June 30, 2021 that were modified in the twelve months prior to default. The Company had one troubled debt restructuring incur a payment default in the year ended June 30, 2020 that was modified in the twelve months prior to default. This default resulted in no charge-offs or additional provision for loan losses.

In order to determine whether a borrower is experiencing financial difficulty, an evaluation is performed of the probability that the borrower will be in payment default on any of its debt in the foreseeable future without the modification. This evaluation is performed under the Company’s internal underwriting policy.

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was signed into law. Section 4013 of the CARES Act, “Temporary Relief From Troubled Debt Restructurings,” provides banks the option to temporarily suspend certain requirements under U.S. GAAP related to TDRs for a limited period of time to account for the effects of COVID-19. On December 27, 2020, the Consolidated Appropriations Act 2021 was signed into law. Section 541 of this legislation, “Extension of Temporary Relief From Troubled Debt Restructurings and Insurer Clarification,” extends Section 4013 of the CARES Act to the earlier of January 1, 2022 or 60 days after the termination of the national emergency declared relating to COVID-19. Additionally, on April 7, 2020, the banking agencies, including the Board of Governors of the Federal Reserve System and the Federal Deposit Insurance Corporation, issued a statement, “Interagency Statement on Loan Modifications and Reporting for Financial Institutions Working With Customers Affected by the Coronavirus (Revised)” (“Interagency Statement”), to encourage banks to work prudently with borrowers and to describe the agencies’ interpretation of how accounting rules under ASC 310-40, “Troubled Debt Restructurings by Creditors,” apply to certain COVID-19-related modifications.

During the year ended June 30, 2021, the Company granted or extended loan payment deferrals for 31 residential mortgage loans and home equity lines of credit totaling $10.3 million, as well as 35 commercial mortgage, construction and commercial loans totaling $42.1 million. In accordance with either the CARES Act (as amended) or Interagency Statement, these modifications are not considered troubled debt restructurings. The Company had 19 and 293 loans totaling $27.3 million and $200.6 million on loan payment deferral as of June 30, 2021 and June 30, 2020, respectively.

The Company 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, and current economic trends, among other factors. The Company analyzes loans individually by classifying the loans as to credit risk. This analysis includes non-homogeneous loans, such as commercial and commercial real estate loans. This analysis is performed on a monthly basis. The Company utilized the same grading process for acquired loans as it does for originated loans. The Company 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 and loans in groups of homogenous loans are considered to be pass rated loans. These loans are monitored based on delinquency and performance. Based on the most recent analysis performed, the risk category of loans by class of loans is as follows (in thousands):

	June 30, 2021
	Pass		Special Mention		Substandard		Total
Residential mortgages	$	219,901	$	2,480	$	1,924	$	224,305
Commercial mortgages		809,660		1,615		15,349		826,624
Construction		9,038		1,113		-		10,151
Commercial loans		146,275		491		3,892		150,658
Home equity lines of credit		24,400		602		437		25,439
Consumer and overdrafts		345		-		-		345
Total	$	1,209,619	$	6,301	$	21,602	$	1,237,522

	June 30, 2020
	Pass		Special Mention		Substandard		Total
Residential mortgages	$	252,604	$	687	$	2,091	$	255,382
Commercial mortgages		803,048		3,176		882		807,106
Construction		11,053		-		-		11,053
Commercial loans		160,137		201		3,919		164,257
Home equity lines of credit		28,894		498		446		29,838
Consumer and overdrafts		481		-		-		481
Total	$	1,256,217	$	4,562	$	7,338	$	1,268,117

As of June 30, 2021, of the $27.3 million in loans in a COVID-19 related payment deferral, $9.9 million were pass-rated, with $3.2 million and $14.2 million rated special mention and substandard, respectively. As of June 30, 2020, of the $200.6 million in loans on deferral, $195.4 million and $5.2 million were rated pass and substandard, respectively.

The Company has acquired loans for which there was, at acquisition, evidence of deterioration of credit quality since origination and it was probable, at acquisition, that all contractually required payments would not be collected. The carrying amount of those loans is as follows (in thousands):

Accretable yield, or income expected to be collected, for acquired loans is as follows (in thousands):

	Year ended June 30,
	2021			2020
Beginning balance	$	156		$	192
New loans acquired		-			-
Accretion income		(26	)		(36	)
Reclassification from non-accretable difference		-			-
Disposals		-			-
Ending balance	$	130		$	156