~~Report of Independent Registered Public Accounting Firm~~

~~To the Stockholders and the Board of Directors~~

~~HomeTrust Bancshares, Inc. and Subsidiary~~

~~Opinion on the Consolidated Financial Statements~~

We have audited the accompanying consolidated balance sheets of HomeTrust Bancshares, Inc. and Subsidiary (the "Company") as of June 30, 2020 and 2019, and the related consolidated statements of income, comprehensive income, changes in stockholders’ equity and cash flows for each of the three years in the period ended June 30, 2020, and the related notes (collectively referred to as the "consolidated financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of June 30, 2020 and 2019, and the result of their operations and their cash flows for each of the three years in the period ended June 30, 2020, in conformity with U.S. generally accepted accounting principles.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of June 30, 2020, based on criteria established in Internal Control- Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated September 11, 2020 expressed an unqualified opinion thereon.

~~Basis for Opinion~~

These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

~~/s/ DIXON HUGHES GOODMAN LLP~~

~~We have served as the Company's auditor since 2005.~~

~~Asheville, North Carolina~~

~~September 11, 2020~~

Report of Independent Registered Public Accounting Firm

To the Stockholders and the Board of Directors

HomeTrust Bancshares, Inc. and Subsidiary

~~Opinion~~Opinions on the Consolidated Financial Statements and Internal Control Over Financial Reporting

We have audited the accompanying consolidated balance sheets of HomeTrust Bancshares, Inc. and Subsidiary (the ~~“Company”~~"Company")’s as of June 30, 2022 and 2021, the related consolidated statements of income, comprehensive income, changes in stockholders’ equity, and cash flows, for each of the years in the three-year period ended June 30, 2022, and the related notes (collectively referred to as the "consolidated financial statements"). We have also audited the Company’s internal control over financial reporting as of June 30, ~~2020,~~2022, based on criteria established in Internal ~~Control—~~Control –Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway ~~Commission.~~ Commission ("COSO").

In our opinion, ~~HomeTrust Bancshares, Inc.~~the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of June 30, 2022 and ~~Subsidiary~~2021, and the results of its operations and its cash flows for each of the years in the three-year period ended June 30, 2022, in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of June 30, ~~2020,~~2022, based on criteria established in Internal ~~Control—~~Control –Integrated Framework (2013) issued by ~~the Committee of Sponsoring Organizations of the Treadway Commission.~~COSO.

Change in Accounting Principle

~~We also have audited,~~As discussed in ~~accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”),~~Notes 1 and 5 to the consolidated financial statements, the Company changed its method of ~~HomeTrust Bancshares, Inc. and Subsidiary as~~accounting for credit losses effectiveJuly 1, 2020 due to the adoption of June 30, 2020 and 2019, and for each of the years in the three years ended June 30, 2020, and our report dated September 11, 2020, expressed an unqualified opinion on those consolidated financial statements.

Accounting Standard Codification (“ASC”) Topic 326, Financial Instruments – Credit Losses.

Basis for ~~Opinion~~Opinions

The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, ~~included~~including in the accompanying ~~management’s report~~Report of Management on ~~internal control~~Internal Control over ~~financial reporting.~~Financial Reporting. Our responsibility is to express an opinion on the Company's consolidated financial statements and an opinion on internal control over financial reporting based on our ~~audit.~~ audits.

We are a public accounting firm registered with the ~~PCAOB~~Public Company Accounting Oversight Board (United States "PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our ~~audit~~audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the ~~audit~~audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material ~~respects.~~aspects.

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed ~~risk, and~~risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our ~~audit provides~~audits provide a reasonable basis for our ~~opinion.~~

opinions.

Definition and Limitations of Internal Control Over Financial Reporting

A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of reliable financial statements for external purposes in accordance with generally accepted accounting principles. A ~~company's~~company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the ~~company's~~company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.

Critical Audit Matters

The critical audit matter communicated below is a matter arising from the current-period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Allowance for Credit Losses

As described in Notes 1 and 5 to the consolidated financial statements, the Company’s allowance for credit losses on loans (“ACL”) was $34.7 million as of June 30, 2022. The allowance is estimated by management using information about past events, current conditions and reasonable and supportable forecasts on the collectability of the loan portfolio. The Company collectively evaluates loan pools that share similar risk characteristics which results in the most significant portion of the ACL. A discounted cash flow method is used to evaluate the cash flows for each loan in each collectively evaluated pool which relies on a periodic tendency to default and absolute loss given default applied to a projective model of the pool’s cash flow while considering prepayment and principal curtailment effects. Management has determined that peer loss data provides the best basis for assessing expected credit losses and has incorporated macroeconomic drivers using a statistical regression modeling methodology, where considered appropriate, to adjust historical loss information for current conditions. Included in management’s systematic methodology is consideration of the need to qualitatively adjust the ACL for risks not already incorporated within the loss estimation process. The Company considers qualitative adjustments which can either increase or decrease the quantitative model within their qualitative framework.

We identified the allowance for credit losses as a critical audit matter. The principal considerations for our determination included the high degree of judgment and subjectivity involved in management’s determination of reasonable and supportable forecasts and the identification and measurement of qualitative adjustments. Auditing management’s judgments around those estimates involved a high degree of subjectivity, audit effort, and specialized skills and knowledge.

The primary procedures we performed to address this critical audit matter included:

•We obtained an understanding of the Company’s model and process for determining the ACL, and evaluated the design and operating effectiveness of controls relating to the ACL, including:

◦Controls over the completeness and accuracy of data input into the model used to determine the ACL, and

◦Controls over management’s review and approval of the ACL, including management’s determination of a reasonable and supportable forecast and qualitative factor adjustments applied within the qualitative framework to address risks not already incorporated within the model.

•We evaluated management’s determination of reasonable and supportable forecasts, including comparing key factors to independent sources, as well as involving our valuation specialists in testing the application of forecasts in the model calculation.

•We evaluated the reasonableness and adequacy of management’s qualitative factor adjustment framework, including substantively testing management's identification of risks not already incorporated within the model, the application of qualitative factor adjustments within the framework, and assessing the completeness and accuracy of data utilized in development of the qualitative adjustments.

•We evaluated management’s judgments and assumptions related to the magnitude of qualitative adjustments for reasonableness by assessing relevant trends in credit quality and evaluating the relationship of the trends to the qualitative adjustments applied to the ACL.

/s/ ~~DIXON HUGHES GOODMAN~~FORVIS, LLP (Formerly, Dixon Hughes Goodman LLP)

~~Asheville, North Carolina~~We have served as the Company's auditor since 2005.

Atlanta, Georgia

September ~~11, 2020~~

12, 2022

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Consolidated Balance Sheets

(Dollars in thousands, except per share data)


	June 30,							June 30,
	2020			2019				2022		2021
Assets							Assets
Cash	$	31,908		$	40,909		Cash	$	20,910	$	22,312
Interest-bearing deposits	89,714			30,134			Interest-bearing deposits	84,209		28,678
Cash and cash equivalents	121,622			71,043			Cash and cash equivalents	105,119		50,990
Commercial paper	304,967			241,446
Commercial paper, net							Commercial paper, net	194,427		189,596
Certificates of deposit in other banks	55,689			52,005			Certificates of deposit in other banks	23,551		40,122
Securities available for sale, at fair value	127,537			121,786
Other investments, at cost	38,946			45,378
Debt securities available for sale, at fair value (amortized cost of $130,099 and $154,493 at June 30, 2022 and June 30, 2021, respectively)							Debt securities available for sale, at fair value (amortized cost of $130,099 and $154,493 at June 30, 2022 and June 30, 2021, respectively)	126,978		156,459
FHLB and FRB stock							FHLB and FRB stock	9,326		13,539
SBIC investments, at cost							SBIC investments, at cost	12,758		10,171

Loans held for sale	77,177			18,175			Loans held for sale	79,307		93,539
Total loans, net of deferred loan costs	2,769,119			2,705,190
Allowance for loan losses	(28,072		)	(21,429		)
Net loans	2,741,047			2,683,761
Total loans, net of deferred loan fees and costs							Total loans, net of deferred loan fees and costs	2,769,295		2,733,267
Allowance for credit losses – loans							Allowance for credit losses – loans	(34,690)		(35,468)
Loans, net							Loans, net	2,734,605		2,697,799
Premises and equipment, net	58,462			61,051			Premises and equipment, net	69,094		70,909
Accrued interest receivable	12,312			10,533			Accrued interest receivable	8,573		7,933
Real estate owned (REO)	337			2,929
Deferred income taxes	16,334			26,523
Bank owned life insurance (BOLI)	92,187			90,254

Deferred income taxes, net							Deferred income taxes, net	11,487		16,901
BOLI							BOLI	95,281		93,108
Goodwill	25,638			25,638			Goodwill	25,638		25,638
Core deposit intangibles	1,078			2,499
Core deposit intangibles, net							Core deposit intangibles, net	93		343
Other assets	49,519			23,157			Other assets	52,967		57,676
Total Assets	$	3,722,852		$	3,476,178
Liabilities and Stockholders’ Equity
Total assets							Total assets	$	3,549,204	$	3,524,723
Liabilities and stockholders’ equity							Liabilities and stockholders’ equity
Liabilities							Liabilities
Deposits	$	2,785,756		$	2,327,257		Deposits	$	3,099,761	$	2,955,541
Borrowings	475,000			680,000			Borrowings	—		115,000

Other liabilities	53,833			60,025			Other liabilities	60,598		57,663
Total liabilities	3,314,589			3,067,282			Total liabilities	3,160,359		3,128,204
Stockholders’ Equity
Commitments and contingencies – see Note 16							Commitments and contingencies – see Note 16
Stockholders’ equity							Stockholders’ equity
Preferred stock, $0.01 par value, 10,000,000 shares authorized, none issued or outstanding	—			—			Preferred stock, $0.01 par value, 10,000,000 shares authorized, none issued or outstanding	—		—
Common stock, $0.01 par value, 60,000,000 shares authorized, 17,021,357 shares issued and outstanding at June 30, 2020; 17,984,105 at June 30, 2019	170			180
Common stock, $0.01 par value, 60,000,000 shares authorized, 15,591,466 shares issued and outstanding at June 30, 2022; 16,636,483 at June 30, 2021							Common stock, $0.01 par value, 60,000,000 shares authorized, 15,591,466 shares issued and outstanding at June 30, 2022; 16,636,483 at June 30, 2021	156		167
Additional paid in capital	169,648			190,315			Additional paid in capital	126,106		160,582
Retained earnings	242,776			224,545			Retained earnings	270,276		240,075
Unearned Employee Stock Ownership Plan (ESOP) shares	(6,348		)	(6,877		)
Accumulated other comprehensive income	2,017			733
Unearned ESOP shares							Unearned ESOP shares	(5,290)		(5,819)
Accumulated other comprehensive income (loss)							Accumulated other comprehensive income (loss)	(2,403)		1,514
Total stockholders’ equity	408,263			408,896			Total stockholders’ equity	388,845		396,519
Total Liabilities and Stockholders’ Equity	$	3,722,852		$	3,476,178
Total liabilities and stockholders’ equity							Total liabilities and stockholders’ equity	$	3,549,204	$	3,524,723

June 30,
2020 2019 2018
Operating Activities:
Net income $ 22,783
$ 27,146
$ 8,235
Adjustments to reconcile net income to net cash provided by (used in) operating activities:

Provision for loan losses 8,500
5,700
—
Depreciation 5,856
4,243
3,810
Deferred income tax expense 5,196
5,346
26,121
Net amortization and accretion (5,352 ) (6,828 ) (5,950 )
Gain on sale of premises and equipment —
—
(164 )
Loss on sale and impairment of REO 536
439
127
BOLI income (2,246 ) (2,103 ) (2,117 )
Gain on sale of loans held for sale (9,946 ) (6,218 ) (4,276 )
Origination of loans held for sale (377,741 ) (190,870 ) (143,755 )
Proceeds from sales of loans held for sale 313,967
174,973
143,350
Increase (decrease) in deferred loan fees, net (187 ) (768 ) 181
Increase in accrued interest receivable and other assets (4,584 ) (4,835 ) (1,246 )
Core deposit intangible amortization 1,421
2,029
2,645
ESOP compensation expense 1,195
1,422
1,367
Restricted stock and stock option expense 1,822
1,601
3,027
Increase in other liabilities (3,280 ) (3,649 ) (36 )
Net cash provided by (used in) operating activities (42,060 ) 7,628
31,319
Investing Activities:

Purchase of securities available for sale (77,228 ) (34,675 ) —
Proceeds from maturities of securities available for sale 57,894
38,430
20,675
Purchase of commercial paper, net (57,535 ) (5,824 ) (75,202 )
Purchase of certificates of deposit in other banks (32,949 ) (18,154 ) (17,201 )
Maturities of certificates of deposit in other banks 29,265
33,086
82,538
Principal repayments of mortgage-backed securities 14,512
31,627
20,471
Net redemptions (purchases) of other investments 6,432
(3,447 ) 2,141
Proceeds from sale of loans not originated for sale 154,870
—
—
Net increase in loans (205,693 ) (173,754 ) (168,602 )
Purchase of BOLI (164 ) (137 ) (76 )
Proceeds from redemption of BOLI 477
14
146
Purchase of equipment for operating leases and other assets (13,993 ) (16,578 ) —
Purchase of premises and equipment (2,925 ) (2,124 ) (3,458 )
Proceeds from sale of premises and equipment —
—
923
Capital improvements to REO —
—
(30 )
Proceeds from sale of REO 2,102
1,047
3,883
Acquisition of United Financial of North Carolina, Inc. —
—
(225 )
Net cash used in investing activities (124,935 ) (150,489 ) (134,017 )

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Consolidated Statements of Cash Flows (continued)

(Dollars in thousands)






	Year Ended June 30,
	2022		2021		2020
Financing activities
Net increase in deposits	144,220		169,785		450,291
Net increase (decrease) in short-term borrowings	(115,000)		115,000		(380,000)
Proceeds from long-term borrowings	60,000		—		175,000
Repayment of long-term borrowings	(60,000)		(497,690)		—


Common stock repurchased	(43,348)		(16,155)		(24,484)
Cash dividends paid	(5,452)		(5,018)		(4,552)
Retired stock	(345)		(204)		(222)
Exercised stock options	6,081		4,592		1,541

Net cash provided by (used in) financing activities	(13,844)		(229,690)		217,574
Net increase (decrease) in cash and cash equivalents	54,129		(70,632)		50,579
Cash and cash equivalents at beginning of period	50,990		121,622		71,043
Cash and cash equivalents at end of period	$	105,119	$	50,990	$	121,622

June 30,
2020 2019 2018
Financing Activities:

Net increase in deposits 450,291
131,004
147,802
Net increase (decrease) in borrowings (205,000 ) 45,000
(61,500 )
Common stock repurchased (24,484 ) (30,638 ) —
Cash dividends paid (4,552 ) (3,176 ) —
Retired stock (222 ) (205 ) (494 )
Exercised stock options 1,541
1,173
651
Net cash provided by financing activities 217,574
143,158
86,459
Net Increase (Decrease) in Cash and Cash Equivalents 50,579
297
(16,239 )
Cash and Cash Equivalents at Beginning of Period 71,043
70,746
86,985
Cash and Cash Equivalents at End of Period $ 121,622
$ 71,043
$ 70,746

June 30,
2020 2019 2018
Supplemental Disclosures:
Cash paid during the period for:
Interest $ 33,315
$ 28,997
$ 15,716
Income taxes 1,686
1,549
887
Noncash transactions:

Unrealized gain (loss) in value of securities available for sale, net of income taxes 1,284
2,331
(1,871 )
Transfers of loans to REO 46
731
1,346
Transfers from loans held for sale to total loans held for investment 98,288
—
—
Transfers of loans to held for sale from loans held for investment 240,453
5,794
—
New ROU asset and lease liabilities from adoption of new lease accounting standard 5,296
—
—
Transfer of land from property & equipment to other assets for new finance lease accounting 2,052
—
—


	Year Ended June 30,
	2022		2021		2020
Supplemental disclosures
Cash paid during the period for:
Interest	$	5,312	$	16,446	$	33,315
Income taxes	684		532		1,686
Noncash transactions:
Unrealized gain (loss) in value of debt securities available for sale, net of income taxes	(3,917)		(503)		1,284
Transfers of loans to REO	—		235		46

Transfers of loans held for sale to loans held for investment	43,083		23,106		98,288
Transfers of loans held for investment to loans held for sale	12,825		—		240,453
ROU asset and lease liabilities for operating lease accounting	1,186		2,586		5,296
Transfer of land from premises and equipment to other assets due to the adoption of ASU 2016-02	—		—		2,052
ACL due to the adoption of ASU 2016-13	—		17,347		—
Transfer of premises and equipment to assets held for sale (included in other assets)	3,229		—		—

The accompanying notes are an integral part of these consolidated financial statements.

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

1. Summary of Significant Accounting Policies

~~Business~~Nature of Operations

The consolidated financial statements presented in this report include the accounts of HomeTrust Bancshares, Inc., a Maryland corporation (“HomeTrust”), and its wholly-owned subsidiary, HomeTrust Bank (the “Bank”). As used throughout this report, the term the “Company” refers to HomeTrust and its consolidated subsidiary, unless the context otherwise requires. HomeTrust is a bank holding company primarily engaged in the business of planning, directing, and coordinating the business activities of the Bank. The Bank is a North Carolina state chartered bank and provides a wide range of retail and commercial banking products within its geographic footprint, which includes: North Carolina (the Asheville metropolitan area, Greensboro/"Piedmont" region, Charlotte, and Raleigh/Cary), Upstate South Carolina (Greenville), East Tennessee (Kingsport/Johnson ~~City/Bristol,~~City, Knoxville, and Morristown) and Southwest Virginia (the Roanoke Valley). During the quarter ended September 30, 2021, we closed nine branches located in North Carolina, Tennessee, and Virginia. The Bank operates under a single set of corporate policies and procedures and is recognized as a single banking segment for financial reporting purposes.

~~Operating, Accounting and Reporting Considerations Related to COVID-19~~

The COVID-19 pandemic has negatively impacted the global economy. In response to this crisis, the CARES Act was passed by Congress and signed into law on March 27, 2020. The CARES Act provides an estimated $2.2 trillion to fight the COVID-19 pandemic and stimulate the economy by supporting individuals and businesses through loans, grants, tax changes, and other types of relief. Some of the provisions applicable to the Company include, but are not limited to:

• Accounting for Loan Modifications - The CARES Act provides that a financial institution may elect to suspend (1) the requirements under GAAP for certain loan modifications that would otherwise be categorized as a TDR and (2) any determination that such loan modifications would be considered a TDR, including the related impairment for accounting purposes. The Bank has elected this as a policy change.

~~• PPP - The CARES Act established the PPP, an expansion of the SBA's 7(a) loan program and the Economic Injury Disaster Loan Program, administered directly by the SBA.~~

Also in response to the COVID-19 pandemic, the Federal Reserve, the FDIC, the National Credit Union Administration, the Office of the Comptroller of the Currency, and the Consumer Financial Protection Bureau, in consultation with the state financial regulators (collectively, the “agencies”) issued a joint interagency statement (issued March 22, 2020; revised statement issued April 7, 2020). Some of the provisions applicable to the Company include, but are not limited to:

• Accounting for Loan Modifications - Loan modifications that do not meet the conditions of the CARES Act may still qualify as a modification that does not need to be accounted for as a TDR. The agencies confirmed with FASB staff that short-term modifications made on a good faith basis in response to COVID-19 to borrowers who were current prior to any relief are not TDRs. This includes short-term (e.g., six months) modifications such as payment deferrals, fee waivers, extensions of repayment terms, or insignificant delays in payment.

• Past Due Reporting - With regard to loans not otherwise reportable as past due, financial institutions are not expected to designate loans with deferrals granted due to COVID-19 as past due because of the deferral. A loan’s payment date is governed by the due date stipulated in the legal agreement. If a financial institution agrees to a payment deferral, these loans would not be considered past due during the period of the deferral.

~~• Nonaccrual Status and Charge-offs - While short-term COVID-19 modifications are in effect, these loans generally should not be reported as nonaccrual or as classified.~~

~~See Note 5 Loans for more information on COVID-19 specific loans that have been modified or in deferral.~~

If the negative impact of COVID-19 is sustained into future quarters and years, the Company will be adversely affected. As such, we will maintain our heightened sense of awareness during our review of triggering events that could lead to goodwill impairment.

~~Accounting Principles~~

~~The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States (“US GAAP”).~~

Principles of Consolidation and Subsidiary Activities

The accompanying consolidated financial statements include the accounts of HomeTrust, the Bank, and its wholly-owned subsidiary, WNCSC, at or for the years ended June 30, ~~2020, 2019,~~2022, 2021, and ~~2018.~~2020. WNCSC owns office buildings in Asheville, North Carolina that are leased to the Bank. All intercompany items have been eliminated.

Reclassifications

~~Certain~~To maintain consistency and comparability, certain amounts ~~reported in~~from prior ~~periods’ consolidated financial statements~~periods have been reclassified to conform to ~~the~~ current ~~presentation. Such reclassifications had~~period presentation with no effect on ~~previously reported cash flows,~~net income or stockholders’ equity ~~or net income.~~as previously reported.

Subsequent Events

~~HOMETRUST BANCSHARES, INC. AND SUBSIDIARY~~

~~Notes~~The Company has evaluated subsequent events for recognition and disclosure through September 12, 2022, which is the date the financial statements were available to ~~Consolidated Financial Statements~~

~~(Dollars in thousands, except per share data)~~

be issued.

Use of Estimates in Financial Statements

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Cash ~~and Cash Equivalents~~Flows

Cash and cash equivalents include cash and interest-bearing deposits with initial terms to maturity of 90 days or less. Net cash flows are reported for customer loan and deposit transactions, FHLB and FRB stock, SBIC investments at cost, and short-term borrowings.

Commercial Paper

Commercial paper includes highly liquid short-term debt of investment graded corporations with maturities less than ~~270 days.~~one year. These instruments are typically purchased at a discount based on prevailing interest rates and do not exceed $15,000 per issuer.

Debt Securities

~~The Company classifies debt~~Debt securities ~~as trading, available for sale, or held to maturity.~~

~~Securities~~ available for sale are carried at fair value. These securities are used to execute asset/liability management strategies, manage liquidity, and leverage capital, and therefore may be sold prior to maturity. Adjustments for unrealized gains or losses, net of the income tax effect, are made to accumulated other comprehensive income (loss), a separate component of total stockholders’ equity.

Securities held to maturity are stated at cost, net of unamortized balances of premiums and discounts. When these securities are purchased, the Company intends to and has the ability to hold such securities until maturity.

Declines in the fair value of individual securities available for sale or held to maturity below their cost that are other-than-temporary result in write-downs of the individual securities to their fair value. The related write-downs are included in earnings as realized losses. In estimating other-than-temporary impairment losses, the Company considers among other things, (i) the length of time and the extent to which the fair value has been less than cost, (ii) the financial condition and near-term prospects of the issuer, and (iii) the intent and ability of the Company to retain its investment in the issuer for a period of time sufficient to allow for any anticipated recovery of the unrealized loss, and in the case of debt securities, whether it is more likely than not that the Company will be required to sell the security prior to a recovery.

Premiums and discounts are amortized or accreted over the life of the security as an adjustment to yield. Dividend and interest income are recognized when earned. Gains or losses on the sale of securities are recognized on athe trade date using the specific identification ~~trade date basis.~~method.

~~Loans~~ACL – Available for Sale Securities

~~Portfolio loans are carried at their outstanding principal amount, less unearned~~For available for sale debt securities in an unrealized loss position, the Company evaluates the securities to determine whether the decline in the fair value below the amortized cost basis (impairment) is due to credit-related factors or noncredit-related factors. Any impairment that is not credit related is recognized in other comprehensive income, ~~and deferred nonrefundable loan fees,~~ net of certain origination costs. Interest income is recorded as earned on an accrual basis based on the contractual rate and the outstanding balance, except for nonaccruing loans where interest is recorded as earned on a cash basis. Net deferred loan origination fees/costs are deferred and amortized to interest income over the life of the related loan.

~~Acquired Loans~~

Purchased loans are recorded at their fair value at the acquisition date. Credit discounts are included in the determination of fair value; therefore, an allowance for loan and lease losses is not recorded at the acquisition date. Acquired loans are evaluated upon acquisition and classified as either purchased impaired or purchased non-impaired. Purchased impaired loans reflect credit deterioration since origination such that it is probable at acquisition that the Company will be unable to collect all contractually required payments.

The cash flows expected to be received over the life of the loans were estimated by management. These cash flows were provided to third party analysts to calculate carrying values of the loans, book yields, effective interest income andapplicable taxes. Credit-related impairment if any, based on actual and projected events. Default rates, loss severity, and prepayment speed assumptions will be periodically reassessed to update our expectation of future cash flows. The excess of the cash flows expected to be collected over a loan's carrying value is considered to be the accretable yield and is recognized as ~~interest income over~~an ACL on the ~~estimated life of~~balance sheet, limited to the ~~loan using~~amount by which the ~~effective yield method. The accretable yield may change due to changes in the timing and amounts of expected cash flows. Changes in the accretable yield are disclosed quarterly.~~

The excess of the undiscounted contractual balances due over the cash flows expected to be collected is considered to be the nonaccretable difference. The nonaccretable difference represents our estimate of the credit losses expected to occur and was considered in determiningamortized cost basis exceeds the fair value, with a corresponding adjustment to earnings. Both the ACL and the adjustment to net income may be reversed if conditions change. However, if the Company intends to sell an impaired available for sale debt security, or more likely than not will be required to sell such a security before recovering its amortized cost basis, the entire impairment amount must be recognized in earnings with a corresponding adjustment to the security’s amortized cost basis. Because the security’s amortized cost basis is adjusted to fair value, there is no ACL in such a situation.

In evaluating available for sale debt securities in unrealized loss positions for impairment and the criteria regarding its intent or requirement to sell such securities, the Company considers the extent to which fair value is less than amortized cost, whether the securities are issued by the federal government or its agencies, whether downgrades by bond rating agencies have occurred, and the results of reviews of the loans as of the acquisition date. Subsequent to the acquisition date, any increases in expected cash flows over those expected at purchase date in excess of fair value are adjusted through a change to the accretable yield on a prospective basis. Any subsequent decreases in expected cash flows attributable to credit deterioration are recognized by recording a provision for loan losses. The purchased impaired loans acquired are and will continue to be subject to the Company's internal and external credit review and monitoring.issuers’ financial condition, among other factors.

For purchased non-impaired loans, the difference between the fair value and unpaid principal balance of the loan at the acquisition date is amortized or accreted to interest income over the life of the loans.

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

Changes in the ACL are recorded as provision for (or reversal of) credit loss expense. Losses are charged against the ACL when management believes the uncollectability of an available for sale debt security is confirmed or when either of the criteria regarding intent or requirement to sell is met.

~~Loan Segments and Classes~~Accrued interest receivable is excluded from the estimate of credit losses.

ACL – Held to Maturity Securities

The ~~Company’s loan portfolio~~ACL on held to maturity securities is ~~grouped into two segments (retail consumer loans~~estimated on a collective basis by major security type. Expected credit losses are estimated using a discounted cash flow methodology which considers historical credit loss information that is adjusted for current conditions and ~~commercial loans)~~reasonable and ~~into various classes within each segment. The Company originates, services,~~supportable forecasts.

Accrued interest receivable is excluded from the estimate of credit losses.

FHLB and ~~manages its loans~~FRB Stock

As a requirement for membership, the Bank invests in the stock of both the FHLB of Atlanta and the FRB. No ready market exists for these securities so carrying value, or cost, approximates their fair value based on ~~these segments and classes. The Company’s portfolio segments and classes within those segments are subject to risks that could have an adverse impact on~~ the ~~credit quality~~redemption provisions of the ~~loan portfolio. Management identified~~FHLB of Atlanta and the ~~risks described below~~FRB, respectively. Both cash and stock dividends are reported as ~~significant risks that~~income.

SBIC Investments, At Cost

SBIC investments are ~~generally~~equity securities without a readily determinable fair value and are recorded at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar ~~among~~investment. Adjustments to the ~~loan segments and classes.~~

~~Retail Consumer Loan Segment~~

~~The Company underwrites its retail consumer loans using automated credit scoring and analysis tools. These credit scoring tools take into account factors such~~cost basis occur as ~~payment history, credit utilization, length~~a result of ~~credit history, types of credit currently~~capital contributions, distributions or changes in ~~use, and recent credit inquiries. To the extent that the loan is secured by collateral,~~ the value of the ~~collateral~~Company's equity position. The Company's share of earnings is ~~also evaluated. Common risks to each class of retail consumer loans include general economic conditions within the Company’s markets, such as unemployment~~included in interest and potential declines in collateral values, and the personal circumstances of the borrowers. In addition to these common risks for the Company’s retail consumer loans, various retail consumer loan classes may also have certain risks specific to them.

One-to-four family and construction and land/lot loans are to individuals and are typically secured by one-to-four family residential property, undeveloped land, and partially developed land in anticipation of pending construction ofdividend income with a personal residence. Significant and rapid declines in real estate values can result in residential mortgage loan borrowers having debt levels in excess of the current market value of the collateral, which can lead to higher levels of foreclosures. Construction and land/lot loans may experience delays in completion and cost overruns that exceed the borrower’s financial ability to complete the project. Such cost overruns can result in foreclosure of partially completed and unmarketable collateral.one-quarter lag period.

Originated home equity lines of credit often secured by second liens on residential real estate, thereby making such loans particularly susceptible to declining collateral values. A substantial decline in collateral value could render the Company’s second lien position to be effectively unsecured. Additional risks include lien perfection inaccuracies and disputes with first lien holders that may further weaken collateral positions. Further, the open-end structure of these loans creates the risk that customers may draw on the lines in excess of the collateral value if there have been significant declines since origination. From time to time, the Company purchases certain HELOCs from a third party. The credit risk characteristics are different for these loans since they were not originated by the Company and the collateral is located outside the Company’s market area, primarily in several western states. The Company established an allowance for loan losses based on the historical losses of the portfolio. The Company monitors the performance of these loans and adjusts the allowance for loan losses as necessary.

Indirect auto finance loans are primarily for new and used personal automobiles originated by franchised and independent auto dealers within the Company's geographic footprint. The bank-dealer relationship is governed by contract, which provides warranties and representations, payment schedules, and rights and remedies upon breach. The underwriting process and standards are maintained by the Company and implemented via an automated decision tool, which incorporates the borrower's credit score, loan to value ratio, and terms of the loan to determine the borrower's creditworthiness.

Consumer loans include loans secured by deposit accounts or personal property such as automobiles, boats, and motorcycles, as well as unsecured consumer debt. The value of underlying collateral within this class is especially volatile due to potential rapid depreciation in values since date of loan origination in excess of principal repayment.

~~Commercial Loan Segment~~

The Company’s commercial loans are centrally underwritten based primarily on the customer’s ability to generate the required cash flow to service the debt in accordance with the contractual terms and conditions of the loan agreement. The Company’s commercial lenders and underwriters work to understand the borrower’s businesses and management experiences. The majority of the Company’s commercial loans are secured by collateral, so collateral values are important to the transaction. In commercial loan transactions where the principals or other parties provide personal guarantees, the Company’s commercial lenders and underwriters analyze the relative financial strength and liquidity of each guarantor. Risks that are common to the Company’s commercial loan classes include general economic conditions, demand for the borrowers’ products and services, the personal circumstances of the principals, and reductions in collateral values. In addition to these common risks for the Company’s commercial loans, the various commercial loan classes also have certain risks specific to them.

Construction and development loans are highly dependent on the supply and demand for commercial real estate in the Company’s markets as well as the demand for the newly constructed residential and commercial properties and lots being developed by the Company’s commercial loan customers. Prolonged deterioration in demand could result in significant decreases in the underlying collateral values and make repayment of the outstanding loans more difficult for the Company’s commercial borrowers.

Commercial real estate and commercial and industrial loans are primarily dependent on the ability of the Company’s commercial loan customers to achieve business results consistent with those projected at loan origination resulting in cash flow sufficient to service the debt. To the extent that a borrower’s actual business results significantly underperform the original projections, the ability of that borrower to service the Company’s loan on a basis consistent with the contractual terms may be at risk. While these loans and leases are generally secured by real property, personal property, or business assets such as inventory or accounts receivable, it is possible that the liquidation of the collateral will not fully satisfy the obligation.

~~HOMETRUST BANCSHARES, INC. AND SUBSIDIARY~~

~~Notes to Consolidated Financial Statements~~

~~(Dollars in thousands, except per share data)~~

Municipal leases are primarily made to volunteer fire departments and depend on the tax revenues received from the county or municipality. These leases are mainly secured by vehicles, fire stations, land, or equipment. The underwriting of the municipal leases is based on the cash flows of the fire department as well as projections of future income.

Equipment finance is primarily made up of commercial finance agreements and commercial loans and leases provided by our new Equipment Finance line of business, and primarily for transportation, construction, and manufacturing equipment. The loans have terms on average of five years or less and are secured by the financed equipment.

PPP loans are an expansion of the SBA's 7(a) loan program and the Economic Injury Disaster Loan Program, administered directly by the SBA and as a result of the CARES Act passed by Congress in response to the COVID-19 pandemic. The PPP loans are low interest notes to small business customers to cover payroll expenses and to a lesser extent other various expense ranging from interest on mortgage obligations, rent, utilities, and interest on outstanding debt. The loans are intended to be forgivable if the borrower maintains employees and complies with the CARES Act.

~~Credit Quality Indicators~~

Loans are monitored for credit quality on a recurring basis and the composition of the loans outstanding by credit quality indicator is provided below. Loan credit quality indicators are developed through review of individual borrowers on an ongoing basis. Generally, loans are monitored for performance on a quarterly basis with the credit quality indicators adjusted as needed. The indicators represent the rating for loans as of the date presented based on the most recent assessment performed. These credit quality indicators are defined as follows:

~~Pass—A pass rated asset is not adversely classified because it does not display any of the characteristics for adverse classification.~~

~~Special Mention~~—A special mention asset has potential weaknesses that deserve management’s close attention. If left uncorrected, such potential weaknesses may result in deterioration of the repayment prospects or collateral position at some future date. Special mention assets are not adversely classified and do not warrant adverse classification.

~~Substandard~~—A substandard asset is inadequately protected by the current net worth and paying capacity of the obligor, or of the collateral pledged, if any. Assets classified as substandard generally have a well-defined weakness, or weaknesses, that jeopardize the liquidation of the debt. These assets are characterized by the distinct possibility of loss if the deficiencies are not corrected.

~~Doubtful~~—An asset classified doubtful has all the weaknesses inherent in an asset classified substandard with the added characteristic that the weaknesses make collection or liquidation in full highly questionable and improbable, on the basis of currently existing facts, conditions, and values.

~~Loss~~—Assets classified loss are considered uncollectible and of such little value that their continuing to be carried as an asset is not warranted. This classification is not necessarily equivalent to no potential for recovery or salvage value, but rather that it is not appropriate to defer a full write-off even though partial recovery may be effected in the future.

Loans Held for Sale

Residential mortgages held for sale are ~~valued~~carried at the lower of cost or fair value as determined by outstanding commitments from ~~investors on~~investors. Net unrealized losses, if any, are recorded as a ~~“best efforts” basis or current investor yield requirements, calculated on the aggregate loan basis.~~ valuation allowance and charged to earnings.

The Company originates loans guaranteed by the SBA for the purchase of businesses, business startups, business expansion, equipment, and working capital. All SBA loans are underwritten and documented as prescribed by the SBA. SBA loans are generally fully amortizing and have maturity dates and amortizations of up to 25 years. SBA loans are classified as held for sale and are carried at the lower of cost or fair value. The guaranteed portion of the loan is sold and the servicing rights are retained. At the time of the sale, an asset is recorded for the value of the servicing rights and is amortized over the remaining life of the loan on the effective interest method. The servicing asset is included in other assets and the corresponding servicing fees are recorded in noninterest income. A gain is recorded for any premium received in excess of the carrying value of the net assets transferred in the sale and is ~~also~~ included in noninterest income. The portion of SBA loans that are retained are adjusted to fair value and reclassified to total loans, net of deferred costs (loans held for investment). The net value of the retained loans is included in the appropriate loan classification for disclosure purposes.

~~Beginning in fiscal year 2019, the Company began originating~~ HELOCs held for sale are originated through a third ~~party. These loans are originated~~party in various states outside the Company's geographic footprint, but are underwritten to the Company's underwriting guidelines. The loans are generally held for sale by the Company over a 90 to 180 day period and are serviced by the third party. The loans are marketed by the third party to investors in pools and once sold the Company recognizes a gain or loss on the ~~sale.~~sale in noninterest income.

~~Allowance~~Loans

Loans that management has the intent and ability to hold for ~~Loan Losses~~

~~The allowance for~~the foreseeable future or until maturity or payoff are carried at their outstanding principal amount, less unearned income and deferred nonrefundable loan ~~losses is management’s estimate~~fees, net of probable credit losses that are inherent in the Company’s loan portfolios at the balance sheet date. The allowance increases when the Company provides for loan losses through charges to operating earnings and when the Company recovers amounts from loans previously written down or charged off. The allowance decreases when the Company writes down or charges off loan amounts that are deemed uncollectible.

~~HOMETRUST BANCSHARES, INC. AND SUBSIDIARY~~

~~Notes to Consolidated Financial Statements~~

~~(Dollars in thousands, except per share data)~~

Management determines the allowance for loan losses based on periodic evaluations that are inherently subjective and require substantial judgment because the evaluations require the use of material estimates that are susceptible to significant change.certain origination costs. The Company ~~generally uses two allowance methodologies that are primarily based on management’s determination as~~has made a policy election to ~~whether or not a~~exclude accrued interest from the amortized cost basis of loans and report accrued interest separately from the related loan ~~is considered to be impaired.~~

All classified loans above a certain threshold meeting certain criteria are evaluated for impairment on a loan-by-loan basis and are considered impaired when it is probable, based on current information, that the borrower will be unable to pay contractual interest or principal as required by the loan agreement. Impaired loans below the threshold are evaluated as a pool with additional adjustments to the allowance for loan losses. Loans that experience insignificant payment delays and payment shortfalls are not necessarily considered impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment history, and the amount of the shortfall relative to the principal and interest owed. Impaired loans are measured at their estimated net realizable value based on either the value of the loan’s expected future cash flows discounted at the loan’s effective interest rate orbalance on the ~~collateral value, net of the estimated costs of disposal, if the loan is collateral dependent. For loans considered impaired, an individual allowance for loan losses~~consolidated balance sheets. Interest income is recorded ~~when the loan principal balance exceeds the estimated net realizable value.~~

~~For loans not considered impaired, management determines the allowance for loan losses based~~as earned on estimated loss percentages that are determined by and applied to the various classes of loans that comprise the segments of the Company’s loan portfolio. The estimated loss percentages by loan class are based on a number of factors that include by class (i) average historical losses over the past two years, (ii) levels and trends in delinquencies, impairments, and net charge-offs, (iii) trends in the volume, terms, and concentrations, (iv) trends in interest rates, (v) effects of changes in the Company’s risk tolerance, underwriting standards, lending policies, procedures, and practices, and (vi) national and local business and economic conditions.

~~Future material adjustments to the allowance for loan losses may be necessary due to changing economic conditions or declining collateral values. In addition, bank regulatory agencies, as~~ an integral part of their examination process, periodically review the Company’s allowance for loan losses and may require the Company to make adjustments to the allowance for loan losses based upon judgments that differ significantly from those of management. See "Recent Accounting Pronouncements" for details on the adoption of CECL.

~~Nonperforming Assets~~

~~Nonperforming assets can include loans that are past due 90 days or more~~accrual basis based on the ~~loan’s~~ contractual ~~terms~~rate and ~~continue to accrue interest,~~the outstanding balance, except for nonaccruing loans ~~on which~~where interest is ~~not being accrued,~~recorded as earned on a cash basis. Net deferred loan origination fees/costs are deferred and ~~REO.~~

~~Loans Past Due 90 Days or More, Nonaccruing, Impaired, or Restructured~~amortized to interest income over the life of the related loan.

The Company’s policies related to when loans are placed on nonaccruing status conform to guidelines prescribed by bank regulatory authorities. Generally, the Company suspends the accrual of interest on loans (i) that are maintained on a cash basis because of the deterioration of the financial condition of the borrower, (ii) for which payment in full of principal or interest is not expected (impaired loans), or (iii) on which principal or interest has been in default for a period of 90 days or more, unless the loan is both well secured and in the process of collection. Under the Company’s cost recovery method, interest income is subsequently recognized only to the extent cash payments are received in excess of principal due. Loans are returned to accruing status when all principal and interest amounts contractually due are brought current and concern no longer exists as to the future collectability of principal and interest, which is generally confirmed when the loan demonstrates performance for six consecutive months or payment cycles.

ACL – Loans and Leases

The Company adopted the CECL model under ASU 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,” on July 1, 2020 using the modified retrospective approach. Results for the periods beginning after July 1, 2020 are presented under ASU 2016-13 while prior period amounts are reported in accordance with the incurred loss model previously applicable US GAAP.

The ACL reflects management’s estimate of losses that will result from the inability of its borrowers to make required loan payments. Expected credit losses are reflected in the ACL through a provision for credit losses. Management records loans charged off against the ACL

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

and subsequent recoveries, if any, increase the ACL when they are recognized. Management uses a systematic methodology to determine its ACL for loans held for investment and certain off-balance sheet credit exposures. The ACL is a valuation account that is deducted from the amortized costs basis to present the net amount expected to be collected on the loan portfolio. Management considers the effects of past events, current conditions, and reasonable and supportable forecasts on the collectability of the loan portfolio.

The Company has identified the following loan pools with similar risk characteristics for measuring expected credit losses:

Commercial real estate – This category of loans consists of the following loan types:

Construction and land development – These loans finance the ground up construction, improvement, carrying for sale, and loans secured by raw or improved land. The repayment of construction loans is generally dependent upon the successful completion of the improvements by the builder for the end user, or sale of the property to a third-party.

Commercial real estate – owner and non-owner occupied – These loans include real estate loans for a variety of commercial property types and purposes, including those secured by commercial office or industrial buildings, warehouses, retail buildings, and various special purpose properties.

Multifamily – These are investment real estate loans, primarily secured by non-owner occupied apartment or multifamily residential buildings. Generally, these types of loans are thought to involve a greater degree of credit risk than owner occupied commercial real estate as they are more sensitive to adverse economic conditions.

Commercial – This category of loans consists of the following loan types:

Commercial and industrial – These loans are for commercial, corporate, and business purposes across a variety of industries. These loans include general commercial and industrial loans, loans to purchase capital equipment, and other business loans for working capital and operational purposes. These loans are generally secured by accounts receivable, inventory, and other business assets.

Equipment finance – These loans are primarily made up of commercial finance agreements and commercial leases provided by our Equipment Finance line of business, primarily for transportation, construction, healthcare, and manufacturing equipment. These loans have average terms of five years or less and are secured by the financed equipment.

Municipal leases – These loans are primarily made to fire departments and depend on the tax revenues received from the applicable county or municipality. These leases are mainly secured by vehicles, fire stations, land, or equipment.

PPP loans – With the passage of the PPP, the Company actively participated in assisting its customers with applications for loans through the program. Loans funded through the PPP program are fully guaranteed by the U.S. government subject to certain representations and warranties. This guarantee exists at the inception of the loans and throughout the lives of the loans and was not entered into separately and apart from the loans. ASC 326 requires credit enhancements that mitigate credit losses, such as the U.S. government guarantee on PPP loans, to be considered in estimating credit losses. The guarantee is considered “embedded” and, therefore, is considered when estimating credit loss on the PPP loans. Given that the loans are fully guaranteed by the U.S. government and absent any specific loss information on any of our PPP loans, the Company did not carry an ACL on its PPP loans at June 30, 2022 and 2021.

Residential real estate – This category of loans consists of the following loan types:

Construction and land development – These loans are to individuals and are typically secured by a one-to-four family residential property under construction or undeveloped or partially developed land in anticipation of the construction of a personal residence.

One-to-four family – These loans are to individuals and are typically secured by one-to-four family residential property.

HELOCs – These loans include both loans originated by the Company and those purchased from a third party and are often secured by second liens on residential real estate.

Consumer – Consumer loans include loans secured by deposit accounts or personal property such as automobiles, boats, and motorcycles, as well as unsecured consumer debt.

For collectively evaluated loans, the Company uses a DCF method for each loan in a pool, and the results are aggregated at the pool level. A periodic tendency to default and absolute loss given default are applied to a projective model of the pool’s cash flows while considering prepayment and principal curtailment effects. The analysis produces expected cash flows for each instrument in the pool by pairing loan-level term information (maturity date, payment amount, interest rate, etc.) with top-down pool assumptions (default rates and prepayment speeds).

Management has determined that peer loss experience provides the best basis for its assessment of expected credit losses to determine the ACL. The Company utilized peer call report data to measure historical credit loss experience with similar risk characteristics within the segments over an economic cycle. Management reviewed the historical loss information to appropriately adjust for differences in current asset specific risk characteristics. Management also considered further adjustments to historical loss information for current conditions and reasonable and supportable forecasts that differ from the conditions that existed for the period over which historical information was evaluated. For all segment models for collectively evaluated loans (except for HELOCs), the Company incorporated one macroeconomic driver, the national unemployment rate, using a statistical regression modeling methodology. The HELOC segment incorporated two macroeconomic drivers, the national unemployment rate and one-year percentage change in the national home price index. Due to the low loss rates of municipal leases and the expectation of them remaining low, management has elected to separately pool these loans. Management has elected to use readily available municipal default rates and loss given defaults in order to calculate expected credit losses.

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

Management considers forward-looking information in estimating expected credit losses. The Company uses the Fannie Mae quarterly economic forecast which is a baseline outlook for the United States economy. For the contractual term that extends beyond the reasonable and supportable forecast period, the Company reverts to historical loss information within four quarters using a straight-line approach. Management may apply different reversion techniques depending on the economic environment for the financial asset portfolio and as of the current period has utilized a linear reversion technique.

Included in its systematic methodology to determine its ACL for loans held for investment and certain off-balance sheet credit exposures, management considers the need to qualitatively adjust expected credit losses for risks not already captured in the loss estimation process. These qualitative adjustments can either increase or decrease the quantitative model estimation (i.e. formulaic model results). Each period the Company considers qualitative factors that are relevant within the qualitative framework consistent with the regulatory interagency policy statement on the ACL.

When a loan no longer shares similar risk characteristics with its segment, the asset is assessed to determine whether it should be included in another pool or should be individually evaluated, which includes consideration of the materiality of the loan. Generally, individually evaluated loans other than TDRs are on nonaccrual status. The expected credit losses on individually evaluated loans will be estimated based on a DCF analysis unless the loan meets the criteria for use of the fair value of collateral, either by virtue of an expected foreclosure or through meeting the definition of collateral dependent. Financial assets that have been individually evaluated can be returned to a pool for purposes of estimating the expected credit loss insofar as their credit profile improves and that the repayment terms are not considered to be unique to the asset.

Restructured loans to borrowers who are experiencing financial difficulty, and on which the Company has granted concessions that modify the terms of the loan, are accounted for as ~~troubled debt restructurings (“TDRs”).~~TDRs. These loans remain as TDRs until the loan has been paid in full, modified to its original terms, or charged off. The Company may place these loans on accrual or nonaccrual status depending on the individual facts and circumstances of the borrower. Generally, these loans are put on nonaccrual status until there is adequate performance that evidences the ability of the borrower to make the contractual payments. This period of performance is normally at least six months, and may include performance immediately prior to or after the modification, depending on the specific facts and circumstances of the borrower.

~~Loan Charge-offs~~

Management measures expected credit losses over the contractual term of the loans. When determining the contractual term, the Company considers expected prepayments but is precluded from considering expected extensions, renewals, or modifications, unless the Company reasonably expects it will execute a TDR with a borrower. In the event of a reasonably-expected TDR, the Company factors the reasonably-expected TDR into the current expected credit losses estimate. The effects of a TDR are recorded when an individual asset is specifically identified as a reasonably-expected TDR. The Company ~~charges off loan balances, in whole or in part~~identifies the point at which it offers the modification to ~~net realizable value or~~the borrower as the point at which the TDR is reasonably expected. The Company uses a DCF methodology to calculate the effect of the concession provided to the borrower within the ACL.

Acquired Loans

Acquired loans are recorded at fair value ~~less costs to sell, when available, verifiable,~~at the date of acquisition based on a discounted cash flow methodology that considers various factors including the type of loan and ~~documentable information confirms that specific loans,~~related collateral, classification status, fixed or ~~portions~~variable interest rate, term of ~~specific~~loan and whether or not the loan was amortizing, and a discount rate reflecting the Company’s assessment of risk inherent in the cash flow estimates. Certain larger purchased loans are ~~uncollectible or unrecoverable. For unsecured~~individually evaluated while certain purchased loans ~~losses~~ are ~~confirmed~~grouped together according to similar risk characteristics and are treated in the aggregate when applying various valuation techniques. These cash flow evaluations are inherently subjective as they require material estimates, all of which may be susceptible to significant change.

Prior to July 1, 2020, loans acquired in a business combination that had evidence of deterioration of credit quality since origination and for which it ~~can be determined~~was probable, at acquisition, that the ~~borrower, or any guarantors, are unwilling or~~Company would be unable to ~~pay~~collect all contractually required payments receivable were considered PCI loans. PCI loans were individually evaluated and recorded at fair value at the ~~amounts as agreed. When the borrower, or any guarantor, is unwilling or unable to pay the amounts as agreed~~date of acquisition with no initial valuation allowance based on a discounted cash flow methodology that considered various factors including the type of loan ~~secured by~~and related collateral, classification status, fixed or variable interest rate, term of loan and ~~any recovery will be realized upon the sale of the collateral,~~whether or not the loan ~~is deemed to be collateral dependent. Repayments or recoveries for collateral dependent loans are directly affected by~~was amortizing, and a discount rate reflecting the ~~value~~Company’s assessment of risk inherent in the ~~collateral~~cash flow estimates. The difference between the undiscounted cash flows expected at ~~liquidation. As such, loan repayment can be affected by factors that influence~~acquisition and the ~~amount recoverable, the timing of the recovery, or a combination of the two. Such factors include economic conditions that affect the markets~~investment in ~~which~~ the loan, or ~~its collateral is sold, bankruptcy, repossession~~the “accretable yield,” was recognized as interest income on a level-yield method over the life of the loan. Contractually required payments for interest and ~~foreclosure laws,~~principal that exceed the undiscounted cash flows expected at acquisition, or the “nonaccretable difference,” were not recognized on the balance sheet and ~~consumer banking regulations. Losses are also confirmed when~~did not result in any yield adjustments, loss accruals or valuation allowances. Increases in expected cash flows, including prepayments, subsequent to the initial investment were recognized prospectively through adjustment of the yield on the loan over its remaining life. Decreases in expected cash flows were recognized as impairment. Valuation allowances on PCI loans reflected only losses incurred after the acquisition (meaning the present value of all cash flows expected at acquisition that ultimately were not to be received).

Subsequent to July 1, 2020, loans acquired in a business combination that have experienced more-than-insignificant deterioration in credit quality since origination are considered PCD loans. At the acquisition date, an estimate of expected credit losses is made for groups of PCD loans with similar risk characteristics and individual PCD loans without similar risk characteristics. This initial ACL is allocated to individual PCD loans and added to the purchase price or ~~a portion~~acquisition date fair values to establish the initial amortized cost basis of the ~~loan,~~PCD loans. As the initial ACL is ~~classified as~~added to the purchase price, there is no credit loss ~~resulting from loan reviews conducted by~~expense recognized upon acquisition of a PCD loan. Any difference between the ~~Company~~unpaid principal balance of PCD loans and the amortized cost basis is considered to relate to noncredit factors and results in a discount or ~~its bank regulatory examiners.~~

~~Charge-offs of loans in the commercial loan segment~~premium. Discounts and premiums are recognized ~~when~~through interest income on a level-yield method over the ~~uncollectibility~~life of the ~~loan balance and the inability~~loans. All loans considered to ~~recover sufficient value from the sale of any collateral securing the loan is confirmed. The uncollectibility of the loan balance is evidenced by the inability of the commercial borrower~~be PCI prior to ~~generate cash flows sufficient~~July 1, 2020 were converted to ~~repay the loan as agreed causing the loan to become delinquent. For collateral dependent commercial loans, the Company determines the net realizable value of the collateral based~~PCD on ~~appraisals, current market conditions,~~that date.

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

For acquired loans not deemed purchased credit deteriorated at acquisition, the differences between the initial fair value and ~~estimated costs to sell~~ the ~~collateral. For collateral dependent commercial loans where~~unpaid principal balance are recognized as interest income on a level-yield basis over the ~~loan balance, including any accrued interest, net deferred fees or costs, and unamortized premiums or discounts, exceeds the net realizable value~~lives of the ~~collateral securing~~related loans. At the acquisition date, an initial ACL is estimated and recorded as credit loss expense.

The subsequent measurement of expected credit losses for all acquired loans is the same as the subsequent measurement of expected credit losses for originated loans.

Loan Commitments and ACL on Off-Balance Sheet Credit Exposures

Financial instruments include off-balance sheet credit instruments, such as undisbursed portions of construction loans, commitments to originate loans, unused lines of credit, and standby letters of credit. The Company’s exposure to credit loss in the event of nonperformance by the other party to the financial instrument for off-balance sheet loan commitments is represented by the ~~deficiency~~contractual amount of those instruments. Such financial instruments are recorded when they are funded.

The Company records an ACL on off-balance sheet credit exposures, unless the commitments to extend credit are unconditionally cancelable, through a provision for credit losses charged against earnings. The ACL on these exposures is ~~identified~~estimated by loan segment at each balance sheet date under the CECL model using the same methodologies as ~~unrecoverable, is deemed to be a confirmed loss,~~portfolio loans, taking into consideration the likelihood that funding will occur, and is ~~charged off.~~included in other liabilities on the Company’s consolidated balance sheets.

~~Charge-offs of loans in~~Premises and Equipment

Premises and equipment are stated at cost less accumulated depreciation. Depreciation is computed using the ~~retail consumer loan segment~~straight-line method over the estimated useful lives. Leasehold improvements are ~~generally confirmed and recognized in a manner similar to charge-offs of loans in~~amortized over the ~~commercial loan segment. Secured retail consumer loans that are identified as uncollectible and are deemed to be collateral dependent are confirmed as loss to the extent the net realizable value~~lives of the ~~collateral is insufficient to recover~~respective leases or the ~~loan balance. Consumer loans not secured by real estate that become 90 days past due are charged off to the extent that the fair value of any collateral, less~~ estimated ~~costs to sell the collateral, is insufficient to recover the loan balance. Consumer loans secured by real estate that become 120 days past due are charged off to the extent that the fair value~~useful life of the real estate securing the loan, less estimated costs to sell the collateral, is insufficient to recover the loan balance. Loans to borrowers in bankruptcy are subject to modification by the bankruptcy court and are charged off to the extent that the fair value of any collateral securing the loan, less estimated costs to sell the collateral, is insufficient to recover the loan balance, unless the Company expects repayment is likely to occur. Such loans are charged off within 60 days of the receipt of notification from a bankruptcy court or when the loans become 120 days past due,leasehold improvement, whichever is ~~shorter.~~less. Maintenance and repair costs are expensed as incurred. Capitalized leases are amortized using the same methods as premises and equipment over the estimated useful lives or lease terms, whichever is less. Obligations under capital leases are amortized using the interest method to allocate payments between principal reduction and interest expense.

Real Estate Owned

~~REO consists~~Foreclosed assets are initially recorded at fair value less costs to sell when acquired, establishing a new cost basis. Physical possession of real ~~estate acquired as~~property collateralizing a ~~result~~loan occurs when legal title is obtained upon completion of ~~customers’~~foreclosure or when the borrower conveys all interest in the property to satisfy the loan ~~defaults. REO is stated~~through completion of a deed in lieu of foreclosure or through a similar legal agreement. These assets are subsequently accounted for at lower of cost or fair value less estimated costs to sell. If the fair value ~~of the property net of the estimated costs of disposal with a charge to the allowance for loan losses upon foreclosure, if necessary. Any write-downs~~declines subsequent to foreclosure, a valuation allowance is recorded through expense. Operating costs after acquisition are ~~charged against operating earnings. To~~expensed.

Bank Owned Life Insurance

The Company has purchased life insurance policies on certain key executives. BOLI is recorded at the ~~extent recoverable, costs relating to~~amount that can be realized under the ~~development and improvement of property~~insurance contract at the balance sheet date, which is the cash surrender value adjusted for other charges or other amounts due that are ~~capitalized, whereas those costs relating to holding the property are charged to expense.~~

~~Premises and Equipment~~

~~Premises and equipment are stated~~probable at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives. Leasehold improvements are amortized over the lives of the respective leases or the estimated useful life of the leasehold improvement, whichever is less. Maintenance and repair costs are expensed as incurred. Capitalized leases are amortized using the same methods as premises and equipment over the estimated useful lives or lease terms, whichever is less. Obligations under capital leases are amortized using the interest method to allocate payments between principal reduction and interest expense.

~~Other Investments, At Cost~~

As a requirement for membership, the Bank invests in stock of the FHLB of Atlanta and the FRB. These investments are carried at cost due to the redemption provisions of these entities and the restricted nature of the securities. SBICs are considered equity securities without a readily determinable fair value. Prior to the adoption of ASU 2016-01 in the first quarter of fiscal 2019, SBICs were maintained in other assets. Beginning July 1, 2018, the SBIC investments are accounted for at cost less impairment, plus or minus changes resulting from observable price changes. Management reviews the investments for impairment based on the ultimate recoverability of their cost basis.settlement.

Business Combinations

The Company uses the acquisition method of accounting for all business combinations. An acquirer must be identified for each business combination, and the acquisition date is the date the acquirer achieves control. The acquisition method of accounting requires the Company as acquirer to recognize the fair value of assets acquired and liabilities assumed at the acquisition date as well as recognize goodwill or a gain from a bargain purchase, if appropriate. Any acquisition-related costs and restructuring costs are recognized as period expenses as incurred.

Goodwill

Goodwill represents the excess of the purchase price over the sum of the estimated fair values of the tangible and identifiable intangible assets acquired less the estimated fair value of the liabilities assumed in a business combination. Goodwill has an indefinite useful life and is evaluated for impairment annually in the fourth quarter or more frequently if events and circumstances indicate that the asset might be impaired. ~~An impairment loss is recognized to the extent that the carrying amount exceeds the asset’s fair value.~~

~~In testing goodwill for impairment, we have the option to assess either~~The Company first assesses qualitative ~~or quantitative~~ factors to determine whether ~~the existence of events or circumstances leads to a determination that~~ it is more likely than not that the ~~estimated~~ fair value of a reporting unit is less than its carrying ~~amount. If we elect~~amount as a basis for determining the need to perform athe test for goodwill impairment (the qualitative ~~assessment and determine~~method). If the qualitative method cannot be used or if the Company determines, based on the qualitative method, that ~~an impairment~~the fair value is more likely than not ~~we are then required to perform a quantitative impairment test, otherwise no further analysis is required.~~

~~Under~~less than the ~~quantitative impairment test,~~carrying amount, the ~~evaluation involves comparing~~Company compares the ~~current~~estimated fair value of ~~each~~a reporting unit towith its carrying ~~value,~~amount, including goodwill. If the estimated fair value of a reporting unit exceeds its carrying ~~value,~~amount, goodwill of the reporting unit is ~~considered~~ not ~~to be~~considered impaired. If the carrying ~~value~~amount of a reporting unit exceeds its estimated fair value, the Company will record an impairment charge ~~is recognized~~based on that difference. Our annual goodwill impairment test did not identify any impairment for the ~~difference, but limited by the amount of goodwill allocated to the reporting unit. The Company uses a combination of the market~~years ended June 30, 2022 and income approaches to estimate the fair value of its reporting unit when the quantitative impairment approach is chosen or required. All inputs are evaluated by management at the evaluation date of April 1st and reviewed again each reporting period for triggering events to ensure no significant changes occurred that could indicate impairment. Subsequent reversal of goodwill impairment losses is not permitted.

~~HOMETRUST BANCSHARES, INC. AND SUBSIDIARY~~

~~Notes to Consolidated Financial Statements~~

~~(Dollars in thousands, except per share data)~~

2021.

Core Deposit Intangibles

Core deposit intangibles represent the estimated value of long-term deposit relationships acquired in business combinations. These core deposit premiums are amortized using an accelerated method over the estimated useful lives of the related deposits typically between five and ~~ten~~10 years. The estimated useful lives are periodically reviewed for reasonableness.

Servicing Rights

When loans are sold with servicing retained, servicing rights are initially recorded at fair value with the income statement effect recorded in gains on sales of loans. Fair value is based on market prices for comparable mortgage servicing contracts, when available or alternatively, is

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

based on a valuation model that calculates the present value of estimated future net servicing income. All classes of servicing assets are subsequently measured using the amortization method which requires servicing rights to be amortized into noninterest income in proportion to, and over the period of, the estimated future net servicing income of the underlying loans.

Servicing rights are evaluated for impairment based upon the fair value of the rights as compared to carrying amount. Impairment is determined by stratifying rights into groupings based on predominant risk characteristics, such as interest rate, loan type and investor type. Impairment is recognized through a valuation allowance for an individual grouping, to the extent that fair value is less than the carrying amount. If the Company later determines that all or a portion of the impairment no longer exists for a particular grouping, a reduction of the allowance may be recorded as an increase to income. Changes in valuation allowances are reported within loan income and fees on the income statement. The fair values of servicing rights are subject to significant fluctuations as a result of changes in estimated and actual prepayment speeds and default rates and losses.

Servicing fee income, which is reported on the income statement as loan income and fees, is recorded for fees earned for servicing loans. The fees are based on a contractual percentage of the outstanding principal or a fixed amount per loan and are recorded as income when earned. The amortization of servicing rights is netted against loan servicing fee income. Late fees and ancillary fees related to loan servicing are not material.

Revenue from Contracts with Customers

The Company records revenue from contracts with customers in accordance with ASC Topic 606, “Revenue from Contracts with Customers”. Under Topic 606, the Company must identify the contract with a customer, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to the performance obligations in the contract, and recognize revenue when (or as) the Company satisfies a performance obligation. Significant revenue has not been recognized in the current reporting period that results from performance obligations satisfied in previous periods.

The Company’s primary sources of revenue are derived from interest and dividends earned on loans, investment securities, and other financial instruments that are not within the scope of Topic 606. The Company has evaluated the nature of its contracts with customers and determined that further disaggregation of revenue from contracts with customers into more granular categories beyond what is presented in the Consolidated Statements of Income was not necessary. The Company generally fully satisfies its performance obligations on its contracts with customers as services are rendered and the transaction prices are typically fixed, charged either on a periodic basis or based on activity. Since performance obligations are satisfied as services are rendered and the transaction prices are fixed, the Company has made no significant judgments in applying the revenue guidance prescribed in ASC 606 that affect the determination of the amount and timing of revenue from contracts with customers.

Stock-Based Compensation

The Company issues restricted stock, restricted stock units, and stock options under the HomeTrust Bancshares, Inc. 2013 Omnibus Incentive Plan (“2013 Omnibus Incentive Plan”) to key officers and outside directors. In accordance with the requirements of the FASB ASC 718, "Compensation – Stock Compensation," the Company has adopted a fair value based method of accounting for employee stock compensation plans, whereby compensation cost is measured based on the fair value of the award as of the grant date and recognized over the vesting period. The Company accounts for forfeitures as they occur.

Comprehensive Income

Comprehensive income consists of net income and net unrealized gains (losses) on debt securities available for sale and is presented in the Consolidated Statements of Comprehensive Income.

Income Taxes

The Company accounts for income taxes using the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred tax assets are reduced, if necessary, by the amount of such benefits that are not expected to be realized based upon available evidence. See ~~Note 13~~"Note 11 – Income Taxes" for additional information.

The Company recognizes interest and penalties accrued relative to unrecognized tax benefits in its respective federal or state income taxes accounts. As of June 30, ~~2020~~2022 and ~~2019,~~2021, there were no accruals for uncertain tax ~~positions and no accruals~~positions. As of June 30, 2022, $28,000 was accrued for interest and penalties. ~~The Company is no longer subject to examination for federal and state purposes for tax years prior to 2016.~~

~~Employee Benefit Plans~~

~~The KSOP is comprised of two components, the 401(k) Plan and the ESOP. The KSOP benefits employees with at least 1000 hours of service during a 12-month period and who have attained age 21.~~

Under the 401(k), the Company matches employee contributions at 50% of employee deferrals up to 6% of each employee’s compensation. The Company may also make discretionary profit sharing contributions for the benefit of all eligible participants as long as total contributions do not exceed applicable limitations. Employees become fully vestedNo such accrual was in ~~the Company’s contributions after six years of service.~~

Under the ESOP, the amount of the Bank's annual contribution is discretionary, however it must be sufficient to pay the annual loan payment to the Company. Shares released are allocated to each eligible participant based on the ratio of each participant’s compensation, as defined in the ESOP, to the total compensation of all eligible plan participants. Forfeited shares are reallocated among other participants in the Plan. At the discretion of the Bank, cash dividends, when paid on allocated shares, are distributed to participants’ accounts, paid in cash to the participants, or used to repay the principal and interest on the ESOP loan used to acquire Company stock on which dividends were paid. Cash dividends on unallocated shares are used to repay the outstanding debt of the ESOP. It is anticipated that the Bank will make contributions to the ESOP in amounts necessary to amortize the ESOP loan payable to the Company over a 20-year period. Unearned ESOP shares are shown as a reduction of stockholders’ equity. The Company recognizes compensation expense equal to the fair value of the Company’s ESOP shares during the periods in which they become committed to be released. To the extent that the fair value of the Company’s ESOP shares differs from the cost of such shares, the differential is recognized as additional paid in capital. The Company recognizes a tax deduction equal to the cost of the shares released. Because the ESOP is internally leveraged through a loan from the Company to the ESOP, the loan receivable by the Company from the ESOP is not reported as an asset nor is the debt of the ESOP shown as a liability in the consolidated financial statements.

~~See Note 14 for additional information.~~

~~Equity Incentive Plan~~

The Company issues restricted stock, restricted stock units, and stock options under the HomeTrust Bancshares, Inc. 2013 Omnibus Incentive Plan (“2013 Omnibus Incentive Plan”) to key officers and outside directors. In accordance with the requirements of the FASB ASC 718, Compensation – Stock Compensation, the Company has adopted a fair value based method of accounting for employee stock compensation plans, whereby compensation cost is measured based on the fair value of the awardplace as of ~~the grant date and recognized over the vesting period. The Company accounts for forfeitures as they occur.~~June 30, 2021.

~~Comprehensive Income~~

~~Comprehensive income consists of net income and net unrealized gains (losses) on securities available for sale and is presented in the consolidated statements of comprehensive income.~~

Derivative Instruments and Hedging

The Company recognizes all derivatives as either assets or liabilities in the balance sheet, and measures those instruments at fair value. Changes in the fair value of those derivatives are reported in current earnings or other comprehensive income depending on the purpose for which the derivative is held and whether the derivative qualifies for hedge accounting. Loan commitments related to the origination or acquisition of mortgage loans that will be held for sale must be accounted for as derivative instruments. The Company enters into commitments to originate loans whereby the interest rate on the loan is determined prior to funding (rate lock commitments). The Company also enters into forward sales commitments for the mortgage loans underlying the rate lock commitments. The fair values of these two derivative financial instruments are collectively insignificant to the consolidated financial statements.

~~HOMETRUST BANCSHARES, INC. AND SUBSIDIARY~~

~~Notes to Consolidated Financial Statements~~

~~(Dollars in thousands, except per share data)~~

Net Income ~~Per~~per Share

~~Per the provisions of ASC 260, Earnings Per Share, basic~~Basic EPS ~~are~~is computed by dividing net income by the weighted-average number of common shares outstanding for the year, less the average number of nonvested restricted stock awards. Diluted EPS ~~reflect~~reflects the potential dilution from the issuance of additional shares of common

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

stock caused by the exercise of stock options and restricted stock awards. In addition, nonvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents are considered participating securities and are included in the computation of EPS pursuant to the two-class method. The two-class method is an earnings allocation formula that determines EPS for each class of common stock and participating security according to dividends declared (or accumulated) and participation rights in undistributed earnings. ESOP shares are considered outstanding for basic and diluted EPS when the shares are committed to be released.

Net income is allocated between the common stock and participating securities pursuant to the two-class method, based on their rights to receive dividends, participate in earnings, or absorb losses. See ~~Note 16~~"Note 15 – Net Income per Share" for further discussion on the Company’s EPS.

2. Recent Accounting Pronouncements

Adoption of ~~Lease~~New Accounting ~~Standard~~Standards

~~On July 1, 2019,~~In June 2016, the FASB issued ASU 2016-13 which makes significant changes to the ACL on financial instruments presented on an amortized cost basis and disclosures about them. The CECL impairment model requires an estimate of expected credit losses, measured over the contractual life of an instrument, which considers reasonable and supportable forecasts of future economic conditions in addition to information about past events and current conditions. The standard provides significant flexibility and requires a high degree of judgment with regards to pooling financial assets with similar risk characteristics and adjusting the relevant historical loss information in order to develop an estimate of expected lifetime losses. ASU 2016-13 permits the use of estimation techniques that are practical and relevant to the Company’s circumstances, as long as they are applied consistently over time and faithfully estimate expected credit losses in accordance with the standard. The ASU lists several common credit loss methods that are acceptable such as a DCF method, loss-rate method and roll-rate method. In addition, ASU 2016-13 amends the ACL on debt securities and purchased financial assets with credit deterioration.

The Company adopted ASU ~~2016-02,~~ ~~Leases (“Topic 842”),~~ ~~and subsequent related ASUs. The new leasing standard modifies the accounting, presentation, and disclosures for both lessees and lessors. The Company elected~~2016-13 on July 1, 2020 using the modified retrospective ~~transition option which allows~~approach. Results for ~~application of~~ the ~~Topic 842 guidance at the adoption date. Therefore, comparative~~periods beginning after July 1, 2020 are presented under ASC 326 while prior period ~~financial information was not adjusted and will~~amounts continue to be reported ~~under the previous accounting guidance~~in accordance with previously applicable US GAAP. The Company recorded a net reduction of ~~ASC 840,~~ ~~Leases (ASC 840). No cumulative-effect adjustment to~~ retained earnings of $13,358 upon adoption. The transition adjustment included an increase in the ACL on loans of $14,809, an increase in the ACL on off-balance sheet credit exposures of $2,288, and the establishment of an ACL on commercial paper of $250, net of the corresponding increases in deferred tax assets of $3,989. The adoption of this ASU did not have an effect on AFS debt securities.

The Company adopted ASU 2016-13 using the prospective transition approach for PCD financial assets that were previously classified as PCI and accounted for under ASC 310-30. In accordance with the standard, the Company did not reassess whether PCI assets met the criteria of PCD assets as of ~~July 1, 2019~~the date of adoption. The remaining discount on the PCD assets was ~~necessary~~determined to be related to noncredit factors and will be accreted into interest income on a level-yield method over the life of the loans.

Newly Issued but Not Yet Effective Accounting Standards

ASU 2021-05, "Leases (Topic 842): Lessors—Certain Leases with Variable Lease Payments." This ASU amends the lease classification requirements for lessors to classify as an operating lease any lease that would otherwise be classified as a sales-type or direct financing lease that would result in the recognition of a day-one loss at lease commencement, provided that the lease includes variable lease payments that do not depend on an index or rate. When a lease is classified as operating, the lessor does not recognize a net investment in the lease, does not derecognize the underlying asset and therefore, does not recognize a selling profit or loss. The amendments in this ASU are effective for fiscal years beginning after December 15, 2021, and interim periods within those fiscal years and early adoption is permitted. The adoption of ASU 2021-05 is not expected to have a material impact on the financial statements.

ASU 2022-02, "Financial Instruments—Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures." This ASU eliminates the TDR recognition and measurement guidance and requires that an entity evaluate whether the modification represents a new loan or a continuation of an existing loan. The amendment also adjusts the disclosures related to modifications and requires entities to disclose current-period gross write-offs by year of origination within the existing vintage disclosures. The amendments in this ASU are effective for fiscal years beginning after December 15, 2022, and interim periods within those fiscal years and early adoption is permitted. The Company is currently evaluating the impact of adopting the new ~~standard. The Company elected the “package of practical expedients” permitted under the transition~~ guidance which allows the Company not to reassess its prior conclusions regarding lease identification, classification of existing leases, and treatment of initial direct costs on existing leases. Any lease arrangements and significant modifications entered into subsequent to the adoption date are accounted for in accordance with the new standard.

~~Lessee Topic 842 Accounting~~

~~The new leasing standard requires recognition of operating leases~~ on the consolidated balance sheets as ROU assets and lease liabilities. ROU assets represent our right to use underlying assets for the lease terms and lease liabilities represent our obligation to make lease payments arising from the leases. ROU assets and lease liabilities are recognized at the lease commencement date based on the estimated present value of lease payments over the lease term. We use our estimated incremental borrowing rate in determining the present value of lease payments for operating leases and the implicit rate in the lease for our one finance lease.financial statements.

For operating leases, the Company recognized lease liabilities, with corresponding ROU assets, based on the present value of unpaid lease payments for existing operating leases longer than twelve months as of July 1, 2019. The ROU assets were adjusted per Topic 842 transition guidance for existing lease-related balances of accrued and prepaid rent, and unamortized lease incentives provided by lessors. As a result, the Company recognized ROU assets of approximately $5,300 in other assets and corresponding lease liabilities of approximately $5,300 in other liabilities as of July 1, 2019. The July 1, 2019 incremental borrowing rates determined on a collateralized basis for the remaining lease terms were utilized when determining the present value of lease payments at the date of initial adoption.

For our finance lease, the Company leases land for one of its retail locations. Upon adoption of Topic 842, the Company reclassed $2,100 from land to ROU assets in other assets. In addition, the corresponding liability of $1,900, which was disclosed separately on the balance sheet was reclassified to other liabilities.

The Company elected the lessee practical expedient to not separate lease and non-lease components. The Company also elected the short-term lease recognition exemption and will not recognize ROU assets or lease liabilities for leases with a term less than 12 months.

Operating lease cost is recognized as a single lease cost on a straight-line basis over the lease term and is recorded in net occupancy expense. Variable lease payments for common area maintenance, property taxes and other operating expenses are recognized as expense in the period when the changes in facts and circumstances on which the variable lease payments are based occur.

~~Finance lease cost is recognized as a single lease cost using the effective interest method and is recorded in net occupancy expense.~~

~~Lessee Accounting Prior to Adoption of Topic 842~~

Prior to the adoption of ASC 842, the Company applied the guidance of ASC 840. Under ASC 840, operating lease arrangements were off-balance sheet and ROU assets and lease liabilities were not recognized. Operating lease rent expense was recognized on a straight-line basis over the lease term and recorded in net occupancy expense. Common area maintenance, property taxes, and other operating expenses related to leased premises were also recognized in net occupancy expenses, consistent with similar costs for owned locations.

~~Lessor Topic 842 Accounting~~

Prior to the adoption of Topic 842, we determined the lease classification at commencement date. Leases not classified as sales-type or direct financing leases are classified as operating leases. The primary accounting criteria we use for lease classification are (i) review to determine if the lease transfers ownership of the underlying asset to the lessee by the end of the lease term, (ii) review to determine if the lease grants the lessee a purchase option that the lessee is reasonably certain to exercise, (iii) determine if the lease term is for a major part of the remaining economic life of the underlying asset and (iv) determine if the present value of the sum of the lease payments and any residual value guarantees

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

equals or exceeds substantially all of the fair value of the underlying asset. We do not lease equipment of such a specialized nature that it is expected to have no alternative use to the lessor at the end of the lease term.

The Company elected a lessor accounting policy to exclude from revenue and expenses sales taxes and other similar taxes assessed by a governmental authority on lease revenue-producing transactions and collected by the lessor from a lessee.

~~Operating Leases~~ - Assets leased under an operating lease are carried at cost less accumulated depreciation. These assets are depreciated to their estimated residual value using the straight-line method over the lesser of the lease term or estimated useful life of the asset. Assets received at the end of the lease, which are intended to be sold, are marked to the lower of cost or fair value less selling costs with the adjustment recorded in other noninterest income.

At the inception of each operating lease, we record a residual value for the leased equipment based on our estimate of the future value of the equipment at the end of the lease term or end of the equipment’s estimated useful life as indicated by industry data. O~~perating leases~~ have higher risk because a smaller percentage of the equipment's value is covered by contractual cash flows over the term of the lease. If the market value of leased equipment under operating leases decreases at a rate greater than we projected, whether due to rapid technological or economic obsolescence, unusual wear and tear on the equipment, excessive use of the equipment, recession or other adverse economic conditions, or other factors, it could adversely affect the current values or the residual values of such equipment. The Company seeks to mitigate these risks by maintaining a relatively young fleet of leased assets with wide operator bases, which can facilitate attractive lease and utilization rates. The Company manages and evaluates residual values by performing periodic reviews of estimated residual values and monitoring levels of residual realizations. A change in estimated operating lease residual values would result in a change in future depreciation expense. Any impairments are recognized at the time a change is identified.

~~Rental revenue on operating leases is recognized on a straight-line basis over the lease term and is included in other noninterest income.~~

~~Finance Leases~~ - The Company’s finance leases are classified as direct financing leases under ASC 842. The Company’s finance lease activity primarily relates to leasing of new equipment with the equipment purchase price equal to fair value and therefore there is no selling profit or loss at lease commencement. When there is no selling profit or loss, initial direct costs are deferred at the commencement date and included in the measurement of the net investment in the lease.

A lease receivable is recorded for finance leases at present value discounted using the rate implicit in the lease. The lease receivable includes lease payments not yet paid and the guarantee of the residual value by the lessee or unrelated third party, as applicable. Interest income is recognized over the lease term at a constant periodic discount rate on the remaining balance of the lease net investment using the rate implicit in the lease. After the commencement date, lease payments collected are applied to reduce net investment and recognize interest income.

The recognition of interest income is suspended, and an account is placed on non-accrual status when, in the opinion of management, full collection of all principal and interest due is doubtful. All future interest income accruals, as well as amortization of deferred fees, costs, and purchase premiums or discounts are suspended. Subsequent lease payments received are applied to the outstanding net investment balance until such time as the account is collected, charged-off or returned to accrual status. Finance leases that are nonaccrual do not accrue interest income; however, payments designated by the borrower as interest payments may be recorded as interest income. To qualify for this treatment, the remaining recorded investment in the lease must be deemed fully collectible.

The recognition of interest income on finance leases is suspended, and all previously accrued but uncollected revenue is reversed, when lease payments are contractually delinquent for 90 days or more. Accounts, including accounts that have been modified, are returned to accrual status when, in the opinion of management, collection of remaining lease receivables are reasonably assured, and there is a sustained period of repayment performance, generally for a minimum of six months.

Certain finance leases also have residual values at the inception of the lease which are based on our estimate of the future value of the equipment at the end of the lease term or end of the equipment’s estimated useful life as indicated by industry data. Finance leases bear the least risk because contractual payments usually cover approximately 90% of the equipment's cost at the inception of the lease. A change in estimated finance lease residual values during the lease term may impact the loss allowance as a decrease in the residual value may cause an impairment to be recorded on the finance lease.

~~Lessor Accounting Prior to Adoption of Topic 842~~

Lessor accounting was not fundamentally changed by Topic 842 and remains similar to the prior accounting model, with updates to align with certain changes to the lessee model (e.g., certain definitions, such as initial direct costs, have been updated) and the new revenue recognition standard. The new rules did not have a significant impact on our classification of leases as finance or operating. The new lease guidance has a narrower definition of initial direct costs that may be capitalized and allocated internal costs and professional fees to negotiate and arrange the lease agreement that would have been incurred regardless of lease execution no longer qualify as initial direct cost.

~~Recent Accounting Pronouncements~~

In June 2016, the FASB issued ASU No. 2016-13, "Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments." The ASU significantly changes the impairment model for most financial assets that are measured at amortized cost and certain other instruments from an incurred loss model to an expected loss model. This ASU is effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2019. Early adoption is permitted for all entities beginning after December 15, 2018, including

~~HOMETRUST BANCSHARES, INC. AND SUBSIDIARY~~

~~Notes to Consolidated Financial Statements~~

~~(Dollars in thousands, except per share data)~~

interim periods within those fiscal years. The Company has not early adopted. The Company has selected a third-party vendor to provide ongoing support under the new methodology to apply vendor credit models to its portfolios. The Company has evaluated the impact of the current expected credit loss methodology to identify the necessary modifications in accordance with this standard which will require a change in the processes and procedures to calculate the allowance for loan losses, including changes in assumptions and estimates to consider expected credit losses over the life of the loan versus the current incurred loss methodology. Management does not expect the standard to have a material impact on its commercial paper and investment securities portfolios at adoption. Management has determined that peer loss experience provides the best basis for its assessment of expected credit losses to determine its allowance and has run parallel model results in preparation for adopting the new standard on July 1, 2020. Management continues to finalize documentation on the methodologies utilized as well as the controls, processes, policies, and disclosures. The Company will recognize a cumulative-effect adjustment to the opening retained earnings as of the adoption date. Management currently estimates the~~allowance for credit losses will be in a range of $42,000 to $48,000, increasing the allowance by approximately$14,000~~to$20,000. Management also currently estimates a liability for unfunded commitments in a range of $1,500 to $3,000. The estimated decline in equity, net of tax, will range from $12,000 to $18,000. The actual impact will depend on a number of internal and external factors including: outstanding balances, characteristics of our loan and securities portfolios, macroeconomic conditions, forecast information, and management's judgment. Additionally, adoption of the new ASU could result in higher volatility in our quarterly credit loss provision than the current reserve process and could adversely impact the Company's ongoing earnings.

In August 2017, FASB issued ASU 2017-12, "Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities." This ASU improves the transparency and understandability of disclosures in the financial statements regarding the entities risk management activities and reduces the complexity of hedge accounting. The amendments in this ASU permit hedge accounting for hedging relationships involving nonfinancial risk and interest rate risk by removing certain limitations in cash flow and fair value hedging relationships. In addition, the ASU requires an entity to present the earnings effect of the hedging instrument in the same income statement line item in which the earnings effect of the hedged item is reported. The amendments in this ASU are effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2018 and early adoption is permitted. The Company adopted this ASU on July 1, 2019. The adoption did not have a material effect on the Company's Consolidated Financial Statements.

In August 2018, the FASB issued ASU 2018-13, "Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement." The amendments in this ASU removes, modifies, and adds certain disclosure requirements related to fair value measurements in ASC 820. The amendments in this ASU are effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2019 and early adoption is permitted. The adoption of ASU No. 2018-13 is not expected to have a material impact on the Company's Consolidated Financial Statements.

In November 2018, the FASB issued ASU 2018-19, "Codification Improvements to Topic 326, Financial Instruments-Credit Losses." This update clarifies that receivables arising from operating leases are not within the scope of Subtopic 326-20. Instead, impairment of receivables arising from operating leases should be accounted for in accordance with Topic 842, Leases. The effective date and transition requirements for this ASU are the same as ASU 2016-13. The adoption of ASU No. 2018-19 is not expected to have a material impact on the Company's Consolidated Financial Statements.

In December 2018, the FASB issued ASU 2018-20, "Leases (Topic 842): Narrow-Scope Improvements for Lessors." The amendments in this update permit lessors, as an accounting policy election, to not evaluate whether certain sales taxes and other similar taxes are lessor costs or lessee costs. Instead, those lessors will account for those costs as if they are lessee costs. A lessor making this election will exclude from the consideration in the contract and from variable payments not included in the consideration in the contract all collections from lessees of taxes within the scope of the election and will provide certain disclosures. For certain lessor costs, the lessor must exclude from variable payments, and therefore revenue, lessor costs paid by lessees directly to third parties from variable payments. In addition, the lessor must account for costs excluded from the consideration of a contract that are paid by the lessor and reimbursed by the lessee as variable payments. A lessor will record those reimbursed costs as revenue. The amendments in this ASU related to recognizing variable payments for contracts with lease and nonlease components require lessors to allocate (rather than recognize as currently required) certain variable payments to the lease and nonlease components when the changes in facts and circumstances on which the variable payment is based occur. After the allocation, the amount of variable payments allocated to the lease components will be recognized as income in profit or loss in accordance with Topic 842, while the amount of variable payments allocated to nonlease components will be recognized in accordance with other Topics, such as Topic 606. The Company adopted this ASU on July 1, 2019. The adoption did not have a material effect on the Company's Consolidated Financial Statements.

In March 2019, the FASB issued ASU 2019-01, "Leases (Topic 842): Codification Improvements." The amendments in this update include the following items: i) determining the fair value of the underlying asset by lessors that are not manufacturers or dealers; ii) requiring cash received from lessors from sales-type and direct financing leases to be presented in the cash flow statement within investing activities; and iii) clarifying interim disclosure requirements. The Company adopted this ASU on July 1, 2019. The adoption did not have a material effect on the Company's Consolidated Financial Statements.

In April 2019, the FASB issued ASU 2019-04, "Codification Improvements to Topic 326, Financial Instruments-Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments." The amendments in this update are part of the FASB's ongoing project to improve codification and correcting unintended application. The items within this ASU are not expected to have significant effect on current accounting practice. The effective date and transition requirements for the amendments to Financial Instruments (ASU 2016-01) are effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2019 and early adoption is permitted. The effective date and transition requirements for the amendments to Financial Instruments-Credit Losses (ASU 2016-13) are the same as ASU 2016-13 noted above. The effective date and transition requirements for the amendments to Derivatives and Hedging (ASU 2017-12) are the

~~HOMETRUST BANCSHARES, INC. AND SUBSIDIARY~~

~~Notes to Consolidated Financial Statements~~

~~(Dollars in thousands, except per share data)~~

~~same as ASU 2017-12 noted above.The adoption of ASU No. 2019-04 is not expected to have a material impact on the Company's Consolidated Financial Statements.~~

In May 2019, the FASB issued ASU 2019-05, "Financial Instruments - Credit Losses (Topic 326): Targeted Transition Relief." The amendments in this update allow companies to irrevocably elect, upon the adoption of ASU 2016-13, the fair value option for financial instruments that i) were previously recorded at amortized cost and ii) are within the scope of the credit losses guidance in ASC 326-20, iii) are eligible for the fair value option under ASC 825-10, and iv) are not held-to-maturity debt securities. The effective date and transition requirements for this ASU is the same as ASU 2016-13. The adoption of ASU No. 2019-05 is not expected to have a material impact on the Company's Consolidated Financial Statements.

In July 2019, the FASB issued ASU 2019-07, "Codification Updates to SEC Sections." This ASU amends certain paragraphs in the ASC to reflect the issuance of SEC final rules on Disclosure Update and Simplification and Investment Company Reporting Modernization and other miscellaneous updates. The amendments became effective upon issuance. ~~The adoption did not have a material effect on the Company's Consolidated Financial Statements.~~

In November 2019, the FASB issued ASU 2019-11, "Codification Improvements to Topic 326, Financial Instruments-Credit Losses." This ASU clarifies certain aspects of the amendments in ASU 2016-13 and is part of the FASB's ongoing project to improve codification and correcting unintended application. The items within this ASU are not expected to have a significant effect on current accounting practice. The effective date and transition requirements for this ASU is the same as ASU 2016-13. The adoption of ASU No. 2019-11 is not expected to have a material impact on the Company's Consolidated Financial Statements.

In December 2019, the FASB issued ASU 2019-12, "Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes." This ASU is part of the FASB's simplification initiative to reduce complexity in accounting standards. The items within this ASU are not expected to have a significant effect on current accounting practice. The effective date and transition requirements for the first and second items of this ASU are effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2020 and early adoption is permitted. ~~The adoption of ASU No. 2019-12 is not expected to have a material impact on the Company's Consolidated Financial Statements.~~

In January 2020, the FASB issued ASU 2020-01, "Investment—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815): Clarifying the Interactions between Topic 321, Topic 323, and Topic 815." This ASU clarified the interaction of the accounting for equity securities under Topic 321 and investments accounted for under the equity method of accounting in Topic 323 and the accounting for certain forward contracts and purchased options accounted for under Topic 815. The amendments in this ASU are effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2021 and early adoption is permitted. The adoption of ASU No. 2020-01 is not expected to have a material impact on the Company's Consolidated Financial Statements.

In March 2020, the FASB issued ASU 2020-03, "Codification Improvements to Financial Instruments." This ASU makes certain narrow-scope amendments to the following: i) clarified that all entities are required to provide fair value option disclosures; ii) clarified the applicability of the portfolio exception in ASC 820 to nonfinancial items; iii) aligned disclosures for depository and lending institutions (Topic 942) with guidance in Topic 320; iv) added cross-references to guidance in ASC 470-50 on line-of-credit or revolving-debt arrangements; v) added cross-references to net asset value practical expedient in ASC 820-10; vi) clarified the interaction between ASC 842 and ASC 326; and vii) clarified the interaction between ASC 326 and ASC 860-20. The amendments for issues i, ii, iv, and v became effective upon issuance and did not have a material effect on the Company's Consolidated Financial Statements. The amendment related to issue iii has the same effective date and transition requirements as ASU 2019-04 and is not expected to have a material impact on the Company's Consolidated Financial Statements. The amendments related to issues vi and vii have the same effective date and transition requirements as ASU 2016-13 and is not expected to have a material impact on the Company's Consolidated Financial Statements.

2. 3. Debt Securities

~~Securities~~Debt securities available for sale consist of the following at the dates indicated:


	June 30, 2022
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
U.S. government agencies	$	18,993	$	5	$	(539)	$	18,459
MBS, residential	48,377		3		(1,147)		47,233
Municipal bonds	5,545		31		(18)		5,558
Corporate bonds	57,184		1		(1,457)		55,728

Total	$	130,099	$	40	$	(3,161)	$	126,978

June 30, 2020

Amortized
Cost

Gross
Unrealized
Gains

Gross
Unrealized
Losses

Estimated
Fair
Value
U.S. government agencies $ 3,957
$ 216
$ —
$ 4,173
Residential MBS of U.S. government agencies and GSEs 46,629
1,776
(50 ) 48,355
Municipal bonds 16,090
541
—
16,631
Corporate bonds 58,242
270
(134 ) 58,378
Total $ 124,918
$ 2,803
$ (184 ) $ 127,537

~~HOMETRUST BANCSHARES, INC. AND SUBSIDIARY~~

~~Notes to Consolidated Financial Statements~~

~~(Dollars in thousands, except per share data)~~


	June 30, 2019										June 30, 2021
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value			Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
U.S. government agencies	$	15,099	$	122	$	(11	)	$	15,210	U.S. government agencies	$	18,975	$	135	$	(37)	$	19,073
Residential MBS of U.S. government agencies and GSEs	74,778		586		(184		)	75,180
MBS, residential										MBS, residential	42,119		1,339		(54)		43,404
Municipal bonds	24,896		423		(7		)	25,312		Municipal bonds	9,098		453		—		9,551
Corporate bonds	6,061		43		(20		)	6,084		Corporate bonds	84,301		257		(127)		84,431
Equity securities	—		—					$	—

Total	$	120,834	$	1,174	$	(222	)	$	121,786	Total	$	154,493	$	2,184	$	(218)	$	156,459

Debt securities available for sale by contractual maturity at ~~the dates indicated~~June 30, 2022 and 2021 are shown below. ~~Mortgage-backed securities~~MBS are not included in the maturity categories because the borrowers in the underlying pools may prepay without penalty; therefore, it is unlikely that the securities will pay at their stated maturity schedule.


	June 30, 2022
	Amortized Cost		Estimated Fair Value
Due within one year	$	35,350	$	34,956
Due after one year through five years	40,325		39,018
Due after five years through ten years	6,047		5,771
Due after ten years	—		—
MBS, residential	48,377		47,233
Total	$	130,099	$	126,978


	June 30, 2020					June 30, 2021
	Amortized Cost		Estimated Fair Value			Amortized Cost		Estimated Fair Value
Due within one year	$	29,190	$	29,247	Due within one year	$	34,615	$	34,684
Due after one year through five years	44,881		45,516		Due after one year through five years	73,249		73,633
Due after five years through ten years	2,434		2,630		Due after five years through ten years	4,510		4,738
Due after ten years	1,784		1,789		Due after ten years	—		—
Mortgage-backed securities	46,629		48,355
MBS, residential					MBS, residential	42,119		43,404
Total	$	124,918	$	127,537	Total	$	154,493	$	156,459

Pass
Special
Mention
Substandard Doubtful Loss Total
June 30, 2020
Retail consumer loans:
One-to-four family $ 458,248
$ 1,724
$ 9,042
$ 206
$ —
$ 469,220
HELOCs - originated 134,697
902
1,848
—
—
137,447
HELOCs - purchased 71,119
—
662
—
—
71,781
Construction and land/lots 81,112
—
402
—
—
81,514
Indirect auto finance 130,975
—
1,328

—
132,303
Consumer 9,894
4
361
—
—
10,259
Commercial loans:
Commercial real estate 1,028,709
7,580
10,779
—
16
1,047,084
Construction and development 212,370
2,723
250
1
—
215,344
Commercial and industrial 130,202
20,439
2,622
—
—
153,263
Equipment finance 228,288
150
801
—
—
229,239
Municipal leases 127,706
281
—
—
—
127,987
Paycheck Protection Program 80,697
—
—
—
—
80,697
Total loans $ 2,694,017
$ 33,803
$ 28,095
$ 207
$ 16
$ 2,756,138

Pass
Special
Mention
Substandard Doubtful Loss Total
June 30, 2019
Retail consumer loans:
One-to-four family $ 644,159
$ 2,089
$ 8,072
$ 384
$ 19
$ 654,723
HELOCs - originated 137,001
766
1,434
—
9
139,210
HELOCs - purchased 116,306
—
666
—
—
116,972
Construction and land/lots 79,995
71
164
—
—
80,230
Indirect auto finance 152,393
13
1,042

—
153,448
Consumer 11,375
1
33
3
4
11,416
Commercial loans:
Commercial real estate 901,214
8,066
10,306
—
—
919,586
Construction and development 207,827
790
1,357
1
—
209,975
Commercial and industrial 157,325
877
600
—
—
158,802
Equipment finance 131,674
—
384
—
—
132,058
Municipal leases 111,721
295
—
—
—
112,016
Total loans $ 2,650,990
$ 12,968
$ 24,058
$ 388
$ 32
$ 2,688,436

~~The Company’s total PCI loans by segment, class, and risk grade at the dates indicated follows:~~

Pass
Special
Mention
Substandard Doubtful Loss Total
June 30, 2020
Retail consumer loans:
One-to-four family $ 2,994
$ 465
$ 1,014
$ —
$ —
$ 4,473
Construction and land/lots 108
—
237
—
—
345
Commercial loans:
Commercial real estate 3,181
1,742
899
—
—
5,822
Construction and development 271
—
319
—
—
590
Commercial and industrial 1,556
—
3
—
3
1,562
Total loans $ 8,110
$ 2,207
$ 2,472
$ —
$ 3
$ 12,792

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)


	Term Loans By Origination Fiscal Year
June 30, 2022	2022		2021		2020		2019		2018		Prior		Revolving		Total
Commercial and industrial
Risk rating
Pass	$	70,863	$	21,059	$	11,361	$	9,377	$	6,338	$	20,856	$	43,119	$	182,973
Special mention	—		346		260		364		—		—		1,957		2,927
Substandard	—		770		343		1,152		—		52		4,337		6,654
Doubtful	—		98		—		—		—		—		—		98
Loss	—		—		—		—		—		—		—		—
Total commercial and industrial	70,863		22,273		11,964		10,893		6,338		20,908		49,413		192,652
Equipment finance
Risk rating
Pass	186,139		113,363		64,400		26,467		1,755		—		—		392,124
Special mention	200		331		1,002		547		—		—		—		2,080
Substandard	—		123		18		159		—		—		—		300
Doubtful	32		—		—		5		—		—		—		37
Loss	—		—		—		—		—		—		—		—
Total equipment finance	186,371		113,817		65,420		27,178		1,755		—		—		394,541
Municipal leases
Risk rating
Pass	19,425		24,480		8,962		11,034		13,584		39,529		12,715		129,729
Special mention	—		37		—		—		—		—		—		37
Substandard	—		—		—		—		—		—		—		—
Doubtful	—		—		—		—		—		—		—		—
Loss	—		—		—		—		—		—		—		—
Total municipal leases	19,425		24,517		8,962		11,034		13,584		39,529		12,715		129,766
PPP loans
Risk rating
Pass	—		375		286		—		—		—		—		661
Special mention	—		—		—		—		—		—		—		—
Substandard	—		—		—		—		—		—		—		—
Doubtful	—		—		—		—		—		—		—		—
Loss	—		—		—		—		—		—		—		—
Total PPP loans	—		375		286		—		—		—		—		661
Total commercial
Risk rating
Pass	$	276,427	$	159,277	$	85,009	$	46,878	$	21,677	$	60,385	$	55,834	$	705,487
Special mention	200		714		1,262		911		—		—		1,957		5,044
Substandard	—		893		361		1,311		—		52		4,337		6,954
Doubtful	32		98		—		5		—		—		—		135
Loss	—		—		—		—		—		—		—		—
Total commercial	$	276,659	$	160,982	$	86,632	$	49,105	$	21,677	$	60,437	$	62,128	$	717,620

Pass
Special
Mention
Substandard Doubtful Loss Total
June 30, 2019
Retail consumer loans:
One-to-four family $ 4,124
$ 248
$ 1,496
$ —
$ —
$ 5,868
HELOCs - originated 225
—
—
—
—
225
Construction and land/lots 142
—
230
—
—
372
Commercial loans:
Commercial real estate 4,503
1,903
1,300
—
—
7,706
Construction and development 453
—
488
—
—
941
Commercial and industrial 1,666
—
—
—
3
1,669
Total loans $ 11,113
$ 2,151
$ 3,514
$ —
$ 3
$ 16,781

~~The Company’s total loans by segment, class, and delinquency status at the dates indicated follows:~~

Past Due Total
30-89 Days 90 Days+ Total Current Loans
June 30, 2020
Retail consumer loans:
One-to-four family $ 1,679
$ 3,147
$ 4,826
$ 468,867
$ 473,693
HELOCs - originated 442
310
752
136,695
137,447
HELOCs - purchased 214
47
261
71,520
71,781
Construction and land/lots —
252
252
81,607
81,859
Indirect auto finance 756
285
1,041
131,262
132,303
Consumer 30
25
55
10,204
10,259
Commercial loans:
Commercial real estate 4,528
2,892
7,420
1,045,486
1,052,906
Construction and development 293
341
634
215,300
215,934
Commercial and industrial —
91
91
154,734
154,825
Equipment finance 303
498
801
228,438
229,239
Municipal leases —
—
—
127,987
127,987
Paycheck Protection Program —
—
—
80,697
80,697
Total loans $ 8,245
$ 7,888
$ 16,133
$ 2,752,797
$ 2,768,930

Past Due Total
30-89 Days 90 Days+ Total Current Loans
June 30, 2019
Retail consumer loans:
One-to-four family $ 1,615
$ 1,389
$ 3,004
$ 657,587
$ 660,591
HELOCs - originated 226
231
457
138,978
139,435
HELOCs - purchased —
485
485
116,487
116,972
Construction and land/lots 138
6
144
80,458
80,602
Indirect auto finance 459
237
696
152,752
153,448
Consumer 6
8
14
11,402
11,416
Commercial loans:
Commercial real estate 2,279
516
2,795
924,466
927,261
Construction and development —
1,133
1,133
209,783
210,916
Commercial and industrial 207
99
306
160,165
160,471
Equipment finance 649
384
1,033
131,025
132,058
Municipal leases —
—
—
112,016
112,016
Total loans $ 5,579
$ 4,488
$ 10,067
$ 2,695,119
$ 2,705,186

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)


	Term Loans By Origination Fiscal Year
June 30, 2022	2022		2021		2020		2019		2018		Prior		Revolving		Total
Construction and land development
Risk rating
Pass	$	864	$	—	$	53	$	—	$	—	$	1,783	$	78,775	$	81,475
Special mention	—		—		—		—		—		—		—		—
Substandard	—		—		—		—		—		372		—		372
Doubtful	—		—		—		—		—		—		—		—
Loss	—		—		—		—		—		—		—		—
Total construction and land development	864		—		53		—		—		2,155		78,775		81,847
One-to-four family
Risk rating
Pass	55,415		74,035		47,364		29,075		23,250		113,307		4,077		346,523
Special mention	—		—		—		—		—		835		—		835
Substandard	128		—		1,002		540		430		4,590		—		6,690
Doubtful	—		—		—		—		—		155		—		155
Loss	—		—		—		—		—		—		—		—
Total one-to-four family	55,543		74,035		48,366		29,615		23,680		118,887		4,077		354,203
HELOCs
Risk rating
Pass	1,466		458		282		901		107		7,441		148,526		159,181
Special mention	—		—		—		—		—		—		—		—
Substandard	—		—		—		—		—		879		49		928
Doubtful	—		—		—		—		—		28		—		28
Loss	—		—		—		—		—		—		—		—
Total HELOCs	1,466		458		282		901		107		8,348		148,575		160,137
Total residential real estate
Risk rating
Pass	$	57,745	$	74,493	$	47,699	$	29,976	$	23,357	$	122,531	$	231,378	$	587,179
Special mention	—		—		—		—		—		835		—		835
Substandard	128		—		1,002		540		430		5,841		49		7,990
Doubtful	—		—		—		—		—		183		—		183
Loss	—		—		—		—		—		—		—		—
Total residential real estate	$	57,873	$	74,493	$	48,701	$	30,516	$	23,787	$	129,390	$	231,427	$	596,187


	Term Loans By Origination Fiscal Year
June 30, 2022	2022		2021		2020		2019		2018		Prior		Revolving		Total
Total consumer
Risk rating
Pass	$	25,935	$	20,443	$	15,849	$	11,329	$	8,235	$	2,398	$	277	$	84,466
Special mention	—		—		—		—		—		—		—		—
Substandard	72		169		274		85		182		100		33		915
Doubtful	—		—		—		—		—		—		—		—
Loss	—		—		—		2		—		—		—		2
Total consumer	$	26,007	$	20,612	$	16,123	$	11,416	$	8,417	$	2,498	$	310	$	85,383

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

The ~~Company’s~~following table presents the credit risk profile by risk grade for commercial real estate, commercial, residential real estate, and consumer loans by origination year as of June 30, 2021:


	Term Loans By Origination Fiscal Year
June 30, 2021	2021		2020		2019		2018		2017		Prior		Revolving		Total
Construction and land development
Risk rating
Pass	$	18,262	$	6,523	$	10,349	$	6,008	$	2,693	$	7,153	$	123,843	$	174,831
Special mention	—		—		—		—		—		286		3,827		4,113
Substandard	—		—		—		—		—		482		—		482
Doubtful	—		—		—		—		—		—		—		—
Loss	—		—		—		—		—		1		—		1
Total construction and land development	18,262		6,523		10,349		6,008		2,693		7,922		127,670		179,427
Commercial real estate - owner occupied
Risk rating
Pass	73,353		51,983		57,189		25,837		40,780		57,188		11,248		317,578
Special mention	—		—		—		—		172		2,139		—		2,311
Substandard	—		—		—		630		1,572		1,861		398		4,461
Doubtful	—		—		—		—		—		—		—		—
Loss	—		—		—		—		—		—		—		—
Total commercial real estate - owner occupied	73,353		51,983		57,189		26,467		42,524		61,188		11,646		324,350
Commercial real estate - non-owner occupied
Risk rating
Pass	130,682		107,874		74,430		127,418		112,857		140,111		13,498		706,870
Special mention	—		—		—		16,951		946		952		—		18,849
Substandard	—		—		—		—		—		1,642		—		1,642
Doubtful	—		—		—		—		—		—		—		—
Loss	—		—		—		—		—		—		—		—
Total commercial real estate - non-owner occupied	130,682		107,874		74,430		144,369		113,803		142,705		13,498		727,361
Multifamily
Risk rating
Pass	23,816		17,834		10,787		4,892		4,887		23,535		1,115		86,866
Special mention	—		—		—		—		138		—		—		138
Substandard	—		—		—		—		3,421		140		—		3,561
Doubtful	—		—		—		—		—		—		—		—
Loss	—		—		—		—		—		—		—		—
Total multifamily	23,816		17,834		10,787		4,892		8,446		23,675		1,115		90,565
Total commercial real estate
Risk rating
Pass	$	246,113	$	184,214	$	152,755	$	164,155	$	161,217	$	227,987	$	149,704	$	1,286,145
Special mention	—		—		—		16,951		1,256		3,377		3,827		25,411
Substandard	—		—		—		630		4,993		4,125		398		10,146
Doubtful	—		—		—		—		—		—		—		—
Loss	—		—		—		—		—		1		—		1
Total commercial real estate	$	246,113	$	184,214	$	152,755	$	181,736	$	167,466	$	235,490	$	153,929	$	1,321,703

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)


	Term Loans By Origination Fiscal Year
June 30, 2021	2021		2020		2019		2018		2017		Prior		Revolving		Total
Commercial and industrial
Risk rating
Pass	$	29,606	$	14,010	$	18,826	$	10,759	$	15,346	$	10,589	$	36,165	$	135,301
Special mention	—		21		438		110		32		125		37		763
Substandard	31		33		300		—		—		83		4,829		5,276
Doubtful	—		—		—		—		—		—		—		—
Loss	—		—		—		—		—		1		—		1
Total commercial and industrial	29,637		14,064		19,564		10,869		15,378		10,798		41,031		141,341
Equipment finance
Risk rating
Pass	154,685		104,681		53,178		4,773		—		—		—		317,317
Special mention	—		—		—		—		—		—		—		—
Substandard	—		—		323		—		—		—		—		323
Doubtful	—		—		280		—		—		—		—		280
Loss	—		—		—		—		—		—		—		—
Total equipment finance	154,685		104,681		53,781		4,773		—		—		—		317,920
Municipal leases
Risk rating
Pass	23,358		19,240		14,005		17,979		9,738		47,144		8,700		140,164
Special mention	—		—		—		—		—		257		—		257
Substandard	—		—		—		—		—		—		—		—
Doubtful	—		—		—		—		—		—		—		—
Loss	—		—		—		—		—		—		—		—
Total municipal leases	23,358		19,240		14,005		17,979		9,738		47,401		8,700		140,421
PPP
Risk rating
Pass	29,667		16,983		—		—		—		—		—		46,650
Special mention	—		—		—		—		—		—		—		—
Substandard	—		—		—		—		—		—		—		—
Doubtful	—		—		—		—		—		—		—		—
Loss	—		—		—		—		—		—		—		—
Total PPP loans	29,667		16,983		—		—		—		—		—		46,650
Total commercial
Risk rating
Pass	$	237,316	$	154,914	$	86,009	$	33,511	$	25,084	$	57,733	$	44,865	$	639,432
Special mention	—		21		438		110		32		382		37		1,020
Substandard	31		33		623		—		—		83		4,829		5,599
Doubtful	—		—		280		—		—		—		—		280
Loss	—		—		—		—		—		1		—		1
Total commercial	$	237,347	$	154,968	$	87,350	$	33,621	$	25,116	$	58,199	$	49,731	$	646,332

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)


	Term Loans By Origination Fiscal Year
June 30, 2021	2021		2020		2019		2018		2017		Prior		Revolving		Total
Construction and land development
Risk rating
Pass	$	4,244	$	12,133	$	2,357	$	956	$	—	$	3,558	$	42,267	$	65,515
Special mention	—		—		—		—		—		—		—		—
Substandard	—		—		—		96		—		416		—		512
Doubtful	—		—		—		—		—		—		—		—
Loss	—		—		—		—		—		—		—		—
Total construction and land development	4,244		12,133		2,357		1,052		—		3,974		42,267		66,027
One-to-four family
Risk rating
Pass	72,723		52,987		46,958		40,461		37,361		143,531		4,345		398,366
Special mention	—		—		—		—		27		1,084		—		1,111
Substandard	246		981		—		216		86		5,037		—		6,566
Doubtful	—		—		—		—		—		191		—		191
Loss	—		—		—		—		—		315		—		315
Total one-to-four family	72,969		53,968		46,958		40,677		37,474		150,158		4,345		406,549
HELOCs
Risk rating
Pass	2,767		465		1,294		217		716		9,469		152,571		167,499
Special mention	—		—		—		—		—		12		—		12
Substandard	—		—		159		—		38		935		558		1,690
Doubtful	—		—		—		—		—		—		—		—
Loss	—		—		—		—		—		—		—		—
Total HELOCs	2,767		465		1,453		217		754		10,416		153,129		169,201
Total residential real estate
Risk rating
Pass	$	79,734	$	65,585	$	50,609	$	41,634	$	38,077	$	156,558	$	199,183	$	631,380
Special mention	—		—		—		—		27		1,096		—		1,123
Substandard	246		981		159		312		124		6,388		558		8,768
Doubtful	—		—		—		—		—		191		—		191
Loss	—		—		—		—		—		315		—		315
Total residential real estate	$	79,980	$	66,566	$	50,768	$	41,946	$	38,228	$	164,548	$	199,741	$	641,777


	Term Loans By Origination Fiscal Year
June 30, 2021	2021		2020		2019		2018		2017		Prior		Revolving		Total
Total consumer
Risk rating
Pass	$	43,472	$	28,153	$	21,428	$	19,105	$	7,651	$	2,152	$	288	$	122,249
Special mention	—		—				14		—		—		—		14
Substandard	29		418		214		284		147		85		11		1,188
Doubtful	—		—		—		—		—		—		—		—
Loss	2		1		1		—		—		—		—		4
Total consumer	$	43,503	$	28,572	$	21,643	$	19,403	$	7,798	$	2,237	$	299	$	123,455

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

The following tables present aging analyses of past due loans (including nonaccrual loans) by segment and class for the periods indicated below:


	Past Due								Total
	30-89 Days		90 Days+		Total		Current		Loans
June 30, 2022
Commercial real estate
Construction and land development	$	—	$	—	$	—	$	291,202	$	291,202
Commercial real estate - owner occupied	—		52		52		335,606		335,658
Commercial real estate - non-owner occupied	—		—		—		662,159		662,159
Multifamily	—		—		—		81,086		81,086
Total commercial real estate	—		52		52		1,370,053		1,370,105
Commercial
Commercial and industrial	255		—		255		192,397		192,652
Equipment finance	186		56		242		394,299		394,541
Municipal leases	—		—		—		129,766		129,766
PPP loans	—		—		—		661		661
Total commercial	441		56		497		717,123		717,620
Residential real estate
Construction and land development	115		22		137		81,710		81,847
One-to-four family	910		1,394		2,304		351,899		354,203
HELOCs	283		122		405		159,732		160,137
Total residential real estate	1,308		1,538		2,846		593,341		596,187
Consumer	330		177		507		84,876		85,383
Total loans	$	2,079	$	1,823	$	3,902	$	2,765,393	$	2,769,295


	Past Due								Total
	30-89 Days		90 Days+		Total		Current		Loans
June 30, 2021
Commercial real estate
Construction and land development	$	—	$	37	$	37	$	179,390	$	179,427
Commercial real estate - owner occupied	396		1,680		2,076		322,274		324,350
Commercial real estate - non-owner occupied	—		—		—		727,361		727,361
Multifamily	—		—		—		90,565		90,565
Total commercial real estate	396		1,717		2,113		1,319,590		1,321,703
Commercial
Commercial and industrial	634		19		653		140,688		141,341
Equipment finance	—		347		347		317,573		317,920
Municipal leases	—		—		—		140,421		140,421
PPP loans	—		—		—		46,650		46,650
Total commercial	634		366		1,000		645,332		646,332
Residential real estate
Construction and land development	6		35		41		65,986		66,027
One-to-four family	1,112		1,124		2,236		404,313		406,549
HELOCs	488		265		753		168,448		169,201
Total residential real estate	1,606		1,424		3,030		638,747		641,777
Consumer	677		295		972		122,483		123,455
Total loans	$	3,313	$	3,802	$	7,115	$	2,726,152	$	2,733,267

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

The following table presents recorded investment in loans on nonaccrual status, by segment and class, ~~that are not accruing~~including restructured loans. It also includes interest ~~or are 90 days or more past due and still accruing interest at~~income recognized on nonaccrual loans for the ~~dates indicated follows:~~

June 30, 2020 June 30, 2019
Nonaccruing
90 Days + &
still accruing
Nonaccruing
90 Days + &
still accruing
Retail consumer loans:
One-to-four family $ 3,582
$ —
$ 3,223
$ —
HELOCs - originated 531
—
372
—
HELOCs - purchased 662
—
666
—
Construction and land/lots 37
—
6
—
Indirect auto finance 668
—
463
—
Consumer 49
—
21
—
Commercial loans:
Commercial real estate 8,869
—
3,559
—
Construction and development 465
—
1,357
—
Commercial and industrial 259
—
307
—
Equipment finance 801
—
384
—
Total loans $ 15,923
$ —
$ 10,358
$ —

~~PCI loans totaling $965~~atyear ended June 30, ~~2020 and $1,344 at~~ 2022.


	June 30, 2022		June 30, 2021		90 Days + & Still Accruing as of June 30, 2022		Nonaccrual with No Allowance as of June 30, 2022		Interest Income Recognized
Commercial real estate
Construction and land development	$	67	$	482	$	—	$	—	$	5
Commercial real estate - owner occupied	706		3,265		—		—		23
Commercial real estate - non-owner occupied	5		208		—		—		1
Multifamily	103		3,542		—		—		7
Total commercial real estate	881		7,497		—		—		36
Commercial
Commercial and industrial	1,951		49		—		—		290
Equipment finance	270		630		—		—		17


Total commercial	2,221		679		—		—		307
Residential real estate
Construction and land development	137		22		—		—		4
One-to-four family	1,773		2,625		—		540		49
HELOCs	724		929		—		—		28
Total residential real estate	2,634		3,576		—		540		81
Consumer	384		854		—		—		24
Total loans	$	6,120	$	12,606	$	—	$	540	$	448

The significant decrease in the nonaccrual balance in the above schedule compared to June 30, ~~2019 are excluded from nonaccruing loans~~2021 is mainly due to the ~~accretion~~payoff of ~~discounts established in accordance with~~two commercial real estate loan relationships totaling $5.1 million during the ~~acquisition method of accounting for business combinations.~~period.

TDRs are loans which have renegotiated loan terms to assist borrowers who are unable to meet the original terms of their loans. Such modifications to loan terms may include a lower interest rate, a reduction in principal, or a longer term to maturity. ~~Additionally, all~~The above table excludes $9,818 and $11,088 of TDRs ~~are considered impaired.~~

~~The Company’s loans~~ that were performing under ~~the~~their restructured payment terms as of ~~TDRs that were excluded from nonaccruing loans above at the dates indicated follows:~~June 30, 2022 and June 30, 2021, respectively.

June 30, 2020 June 30, 2019
Performing TDRs included in impaired loans $ 13,153
$ 23,116

~~An analysis~~The following tables present analyses of the ~~allowance for loan losses~~ACL on loans by segment for the ~~periods shown is as follows:~~period indicated below. In addition to the provision (benefit) for credit losses on loans presented below, provisions (benefits) of $981 and $35 for off-balance sheet credit exposures and $(100) and $100 for commercial paper were recorded during the fiscal years ended June 30, 2022 and June 30, 2021, respectively.


	Year Ended June 30, 2022
	Commercial Real Estate		Commercial		Residential Real Estate		Consumer		Total
Balance at beginning of period	$	15,084	$	9,663	$	8,185	$	2,536	$	35,468
Provision (benefit) for credit losses	(2,273)		3,110		(1,423)		(886)		(1,472)
Charge-offs	(485)		(1,728)		(116)		(183)		(2,512)
Recoveries	1,088		991		965		162		3,206
Net recoveries (charge-offs)	603		(737)		849		(21)		694
Balance at end of period	$	13,414	$	12,036	$	7,611	$	1,629	$	34,690


	Year Ended June 30, 2021
	Commercial Real Estate		Commercial		Residential Real Estate		Consumer		Total
Balance at beginning of period	$	15,413	$	5,703	$	5,685	$	1,271	$	28,072
Impact of adoption ASU 2016-13	833		3,240		8,687		2,049		14,809
Benefit for credit losses	(311)		(446)		(6,308)		(205)		(7,270)
Charge-offs	(1,000)		(977)		(611)		(945)		(3,533)
Recoveries	149		2,143		732		366		3,390
Net recoveries (charge-offs)	(851)		1,166		121		(579)		(143)
Balance at end of period	$	15,084	$	9,663	$	8,185	$	2,536	$	35,468

June 30, 2020
PCI
Retail
Consumer
Commercial Total
Balance at beginning of period $ 201
$ 6,419
$ 14,809
$ 21,429
Provision for (recovery of) loan losses (19 ) (137 ) 8,656
8,500
Charge-offs —
(855 ) (2,961 ) (3,816 )
Recoveries —
1,479
480
1,959
Balance at end of period $ 182
$ 6,906
$ 20,984
$ 28,072

June 30, 2019
PCI
Retail
Consumer
Commercial Total
Balance at beginning of period $ 483
$ 7,527
$ 13,050
$ 21,060
Provision for (recovery of) loan losses (282 ) (1,244 ) 7,226
5,700
Charge-offs —
(1,136 ) (6,273 ) (7,409 )
Recoveries —
1,272
806
2,078
Balance at end of period $ 201
$ 6,419
$ 14,809
$ 21,429

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

June 30, 2018
PCI
Retail
Consumer
Commercial Total
Balance at beginning of period $ 727
$ 8,585
$ 11,839
$ 21,151
Provision for (recovery of) loan losses 228
(906 ) 678
—
Charge-offs (472 ) (1,142 ) (1,033 ) (2,647 )
Recoveries —
990
1,566
2,556
Balance at end of period $ 483
$ 7,527
$ 13,050
$ 21,060
The following table presents an analysis of the ALL by segment, prior to the adoption of ASU 2016-13:


	Year Ended June 30, 2020
	PCI		Commercial		Retail Consumer		Total
Balance at beginning of period	$	201	$	14,809	$	6,419	$	21,429
Provision (benefit) for credit losses	(19)		8,656		(137)		8,500
Charge-offs	—		(2,961)		(855)		(3,816)
Recoveries	—		480		1,479		1,959
Net recoveries (charge-offs)	—		(2,481)		624		(1,857)
Balance at end of period	$	182	$	20,984	$	6,906	$	28,072

The ~~Company’s~~following tables present ending balances of loans and the related ~~allowance,~~ACL, by segment and class atfor the ~~dates~~periods indicated ~~follows:~~below:


	Allowance for Credit Losses							Total Loans Receivable
		Loans Individually Evaluated		Loans Collectively Evaluated		Total			Loans Individually Evaluated		Loans Collectively Evaluated		Total
June 30, 2022
Commercial real estate
Construction and land development		$	—	$	4,402	$	4,402		$	—	$	291,202	$	291,202
Commercial real estate - owner occupied		—		3,038		3,038			—		335,658		335,658
Commercial real estate - non-owner occupied		—		5,589		5,589			—		662,159		662,159
Multifamily		—		385		385			—		81,086		81,086
Total commercial real estate		—		13,414		13,414			—		1,370,105		1,370,105
Commercial
Commercial and industrial		2,191		2,892		5,083			2,854		189,798		192,652
Equipment finance		—		6,651		6,651			—		394,541		394,541
Municipal leases		—		302		302			—		129,766		129,766
PPP loans		—		—		—			—		661		661
Total commercial		2,191		9,845		12,036			2,854		714,766		717,620
Residential real estate
Construction and land development		—		1,052		1,052			—		81,847		81,847
One-to-four family		—		4,673		4,673			2,486		351,717		354,203
HELOCs		—		1,886		1,886			—		160,137		160,137
Total residential real estate		—		7,611		7,611			2,486		593,701		596,187
Consumer		—		1,629		1,629			—		85,383		85,383
Total		$	2,191	$	32,499	$	34,690		$	5,340	$	2,763,955	$	2,769,295

Allowance for Loan Losses Total Loans Receivable
PCI
Loans
individually
evaluated for
impairment

Loans
Collectively
Evaluated
Total PCI
Loans
individually
evaluated for
impairment

Loans
Collectively
Evaluated
Total
June 30, 2020
Retail consumer loans:
One-to-four family $ 17
$ 52
$ 2,400
$ 2,469
$ 4,473
$ 4,304
$ 464,916
$ 473,693
HELOCs - originated —
—
1,344
1,344
—
—
137,447
137,447
HELOCs - purchased —
—
430
430
—
—
71,781
71,781
Construction and land/lots 33
—
1,409
1,442
345
296
81,218
81,859
Indirect auto finance —
—
1,136
1,136
—
10
132,293
132,303
Consumer —
—
135
135
—
—
10,259
10,259
Commercial loans:
Commercial real estate 113
961
10,731
11,805
5,822
7,924
1,039,160
1,052,906
Construction and development 4
5
3,599
3,608
590
299
215,045
215,934
Commercial and industrial 15
31
2,153
2,199
1,562
852
152,411
154,825
Equipment finance —
209
2,598
2,807
—
801
228,438
229,239
Municipal leases —
—
697
697
—
—
127,987
127,987
Paycheck Protection Program —
—
—
—
—
—
80,697
80,697
Total $ 182
$ 1,258
$ 26,632
$ 28,072
$ 12,792
$ 14,486
$ 2,741,652
$ 2,768,930
June 30, 2019
Retail consumer loans:
One-to-four family $ 62
$ 74
$ 2,375
$ 2,511
$ 5,868
$ 5,318
$ 649,405
$ 660,591
HELOCs - originated —
7
1,023
1,030
225
7
139,203
139,435
HELOCs - purchased —
—
518
518
—
—
116,972
116,972
Construction and land/lots —
—
1,265
1,265
372
323
79,907
80,602
Indirect auto finance —
—
927
927
—
—
153,448
153,448
Consumer —
4
226
230
—
4
11,412
11,416
Commercial loans:
Commercial real estate 118
28
7,890
8,036
7,706
8,692
910,863
927,261
Construction and development 4
5
3,187
3,196
941
1,397
208,578
210,916
Commercial and industrial 17
2
1,957
1,976
1,669
2
158,800
160,471
Equipment finance —
—
1,305
1,305
—
—
132,058
132,058
Municipal leases —
—
435
435
—
—
112,016
112,016
Total $ 201
$ 120
$ 21,108
$ 21,429
$ 16,781
$ 15,743
$ 2,672,662
$ 2,705,186

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

Loans acquired from acquisitions are initially excluded from the allowance for loan losses in accordance with the acquisition method of accounting for business combinations. The Company records these loans at fair value, which includes a credit discount, therefore, no allowance for loan losses is established for these acquired loans at acquisition. A provision for loan losses is recorded for any further deterioration in these acquired loans subsequent to the acquisition.


	Allowance for Credit Losses							Total Loans Receivable
		Loans Individually Evaluated		Loans Collectively Evaluated		Total			Loans Individually Evaluated		Loans Collectively Evaluated		Total
June 30, 2021
Commercial real estate
Construction and land development		$	—	$	1,801	$	1,801		$	80	$	179,347	$	179,427
Commercial real estate - owner occupied		456		2,839		3,295			2,308		322,042		324,350
Commercial real estate - non-owner occupied		—		9,296		9,296			—		727,361		727,361
Multifamily		—		692		692			3,421		87,144		90,565
Total commercial real estate		456		14,628		15,084			5,809		1,315,894		1,321,703
Commercial
Commercial and industrial		9		2,583		2,592			760		140,581		141,341
Equipment finance		—		6,537		6,537			275		317,645		317,920
Municipal leases		—		534		534			—		140,421		140,421
PPP loans		—		—		—			—		46,650		46,650
Total commercial		9		9,654		9,663			1,035		645,297		646,332
Residential real estate
Construction and land development		—		812		812			—		66,027		66,027
One-to-four family		2		5,407		5,409			1,977		404,572		406,549
HELOCs		—		1,964		1,964			—		169,201		169,201
Total residential real estate		2		8,183		8,185			1,977		639,800		641,777
Consumer		—		2,536		2,536			—		123,455		123,455
Total		$	467	$	35,001	$	35,468		$	8,821	$	2,724,446	$	2,733,267

The ~~Company’s impaired loans and the related allowance, by segment and class, excluding PCI loans that were not individually evaluated for impairment, at the dates indicated follows:~~

Total Impaired Loans
Unpaid Principal Balance Recorded Investment
Related
Recorded
Allowance

With a
Recorded
Allowance

With No
Recorded
Allowance
Total
June 30, 2020
Retail consumer loans:
One-to-four family $ 16,560
$ 10,805
$ 3,374
$ 14,179
$ 412
HELOCs - originated 2,087
1,585
53
1,638
43
HELOCs - purchased 662
662
—
662
3
Construction and land/lots 1,585
749
296
1,045
13
Indirect auto finance 1,075
486
241
727
5
Consumer 297
38
27
65
2
Commercial loans:
Commercial real estate 10,401
8,062
1,068
9,130
976
Construction and development 1,785
818
80
898
11
Commercial and industrial 9,782
1,058
26
1,084
34
Equipment finance 2,631
303
498
801
209
Total impaired loans $ 46,865
$ 24,566
$ 5,663
$ 30,229
$ 1,708
June 30, 2019
Retail consumer loans:
One-to-four family $ 18,302
$ 12,461
$ 3,152
$ 15,613
$ 472
HELOCs - originated 2,410
564
1,219
1,783
46
HELOCs - purchased 666
—
666
666
—
Construction and land/lots 1,917
957
323
1,280
26
Indirect auto finance 601
353
137
490
2
Consumer 379
7
41
48
6
Commercial loans:
Commercial real estate 10,127
6,434
3,404
9,838
36
Construction and development 2,574
940
791
1,731
7
Commercial and industrial 10,173
354
768
1,122
6
Equipment finance 462
—
384
384
—
Total impaired loans $ 47,611
$ 22,070
$ 10,885
$ 32,955
$ 601

~~The~~following table ~~above includes $15,743 and $17,212 of~~presents average recorded investments in impaired loans ~~that were not individually evaluated at June 30, 2020~~ and ~~June 30, 2019, respectively, because these~~interest income recognized on impaired loans, ~~did not meet~~prior to the Company’s threshold for individual impairment evaluation. The recorded allowance above includes $450 and $481 related to these loans that were not individually evaluated at June 30, 2020 and June 30, 2019, respectively.adoption of ASU 2016-13:



	2020
	Average Recorded Investment		Interest Income Recognized
Commercial
Commercial real estate	$	8,661	$	336
Construction and development	1,218		54
Commercial and industrial	868		236
Equipment finance	652		29

Total commercial	11,399		655
Retail consumer
One-to-four family	14,796		687
HELOCs - originated	1,698		99
HELOCs - purchased	533		41
Construction and land/lots	1,149		83
Indirect auto finance	547		53
Consumer	194		7
Total retail consumer	18,917		970
Total loans	$	30,316	$	1,625

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

The ~~Company’s average recorded investment and interest income recognized on impaired loans as of the dates indicated follows:~~

Year Ended
June 30, 2020 June 30, 2019 June 30, 2018

Average
Recorded
Investment

Interest
Income
Recognized

Average
Recorded
Investment

Interest
Income
Recognized

Average
Recorded
Investment

Interest
Income
Recognized
Retail consumer loans:
One-to-four family $ 14,796
$ 687
$ 17,319
$ 950
$ 23,257
$ 1,170
HELOCs - originated 1,698
99
1,005
63
2,304
104
HELOCs - purchased 533
41
320
13
189
15
Construction and land/lots 1,149
83
1,441
94
1,575
109
Indirect auto finance 547
53
373
29
256
23
Consumer 194
7
1,328
67
43
17
Commercial loans:
Commercial real estate 8,661
336
5,026
466
6,496
209
Construction and development 1,218
54
1,779
65
2,703
56
Commercial and industrial 868
236
315
249
1,205
60
Equipment finance 652
29
192
37
—
—
Municipal leases —
—
—
—
75
—
Total loans $ 30,316
$ 1,625
$ 29,098
$ 2,033
$ 38,103
$ 1,763

Afollowing table presents a summary of changes in the accretable yield for PCI loans, prior to the adoption of ASU 2016-13:



	2020
Accretable yield, beginning of period	$	5,259



Reclass from nonaccretable yield (1)	458
Other changes, net (2)	(316)
Interest income	(1,496)
Accretable yield, end of period	$	3,905

(1) Represents changes attributable to expected loss assumptions.

(2) Represents changes in cash flows expected to be collected due to the impact of modifications, changes in prepayment assumptions, and changes in interest rates

In estimating ECL, ASC 326 prescribes that if foreclosure is expected, a CDA is required to be measured at the fair value of collateral, but as a practical expedient, if foreclosure is not probable, fair value measurement is optional. For those CDA loans measured at the fair value of collateral, a credit loss expense is recorded for loan amounts in excess of fair value. The following tables provide a breakdown between loans identified as CDAs and non-CDAs, by segment and class, and securing collateral, as well as collateral coverage for those loans for the periods indicated ~~follows:~~below:


	Type of Collateral and Extent to Which Collateral Secures Financial Assets
June 30, 2022	Residential Property		Investment Property		Commercial Property		Business Assets		Financial Assets Not Considered Collateral Dependent		Total

Commercial real estate
Construction and land development	$	—	$	—	$	—	$	—	$	291,202	$	291,202
Commercial real estate - owner occupied	—		—		—		—		335,658		335,658
Commercial real estate - non-owner occupied	—		—		—		—		662,159		662,159
Multifamily	—		—		—		—		81,086		81,086
Total commercial real estate	—		—		—		—		1,370,105		1,370,105
Commercial
Commercial and industrial	—		—		—		2,594		190,058		192,652
Equipment finance	—		—		—		—		394,541		394,541
Municipal leases	—		—		—		—		129,766		129,766
PPP loans	—		—		—		—		661		661
Total commercial	—		—		—		2,594		715,026		717,620
Residential real estate
Construction and land development	—		—		—		—		81,847		81,847
One-to-four family	1,318		—		—		—		352,885		354,203
HELOCs	—		—		—		—		160,137		160,137
Total residential real estate	1,318		—		—		—		594,869		596,187
Consumer	—		—		—		—		85,383		85,383
Total	$	1,318	$	—	$	—	$	2,594	$	2,765,383	$	2,769,295
Total collateral value	$	2,443	$	—	$	—	$	69

Year Ended June 30, 2020 Year Ended June 30, 2019
Accretable yield, beginning of period $ 5,259
$ 5,734
Reclass from nonaccretable yield ⁽¹⁾
458
576
Other changes, net ⁽²⁾
(316 ) 1,018
Interest income (1,496 ) (2,069 )
Accretable yield, end of period $ 3,905
$ 5,259


~~(1)~~	~~Represents changes attributable to expected losses assumptions.~~


~~(2)~~	~~Represents changes in cash flows expected to be collected due to the impact of modifications, changes in prepayment assumptions, and changes in interest rates.~~

~~The following table presents carrying values and unpaid principal balances for PCI loans at the dates indicated below:~~

June 30, 2020 June 30, 2019
Carrying value of PCI loans $ 12,792
$ 16,750
Unpaid principal balance of PCI loans $ 15,581
$ 20,141

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)


	Type of Collateral and Extent to Which Collateral Secures Financial Assets
June 30, 2021	Residential Property		Investment Property		Commercial Property		Business Assets		Financial Assets Not Considered Collateral Dependent		Total

Commercial real estate
Construction and land development	$	—	$	80	$	—	$	—	$	179,347	$	179,427
Commercial real estate - owner occupied	—		—		2,308		—		322,042		324,350
Commercial real estate - non-owner occupied	—		—		—				727,361		727,361
Multifamily	—		3,421		—		—		87,144		90,565
Total commercial real estate	—		3,501		2,308		—		1,315,894		1,321,703
Commercial
Commercial and industrial	—		—		—		25		141,316		141,341
Equipment finance	—		—		—		275		317,645		317,920
Municipal leases	—		—		—		—		140,421		140,421
PPP loans	—		—		—		—		46,650		46,650
Total commercial	—		—		—		300		646,032		646,332
Residential real estate
Construction and land development	—		—		—		—		66,027		66,027
One-to-four family	807		—		—		—		405,742		406,549
HELOCs	—		—		—		—		169,201		169,201
Total residential real estate	807		—		—		—		640,970		641,777
Consumer	—		—		—		—		123,455		123,455
Total	$	807	$	3,501	$	2,308	$	300	$	2,726,351	$	2,733,267
Total collateral value	$	1,160	$	3,602	$	2,723	$	301

The following table presents a breakdown of the types of concessions made on TDRs by loan class for the periods indicated below:


	Year Ended June 30,
	2022					2021					2020
	Number of Loans	Pre Modification Outstanding Recorded Investment		Post Modification Outstanding Recorded Investment		Number of Loans	Pre Modification Outstanding Recorded Investment		Post Modification Outstanding Recorded Investment		Number of Loans	Pre Modification Outstanding Recorded Investment		Post Modification Outstanding Recorded Investment
Below market interest rate
Commercial real estate


Commercial real estate - non-owner occupied	—	$	—	$	—	—	$	—	$	—	1	$	88	$	86

Commercial
Commercial and industrial	1	275		260		—	—		—		—	—		—


Residential real estate

One-to-four family	1	124		120		—	—		—		—	—		—


Total below market interest rate	2	399		380		—	—		—		1	88		86

Year Ended June 30, 2020 Year Ended June 30, 2019 Year Ended June 30, 2018
Number of Loans Pre Modification Outstanding Recorded Investment Post Modification Outstanding Recorded Investment Number of Loans Pre Modification Outstanding Recorded Investment Post Modification Outstanding Recorded Investment Number of Loans Pre Modification Outstanding Recorded Investment Post Modification Outstanding Recorded Investment
Below market interest rate:
Retail consumer:
One-to-four family —
$ —
$ —
1
$ 85
$ 84
—
$ —
$ —
Commercial:
Commercial real estate 1
$ 88
$ 86
—
$ —
—
—
$ —
—
Total 1
$ 88
$ 86
1
$ 85
$ 84
—
$ —
$ —
Extended payment terms:
Retail consumer:
One-to-four family 2
$ 70
$ 61
1
$ 34
$ 34
4
$ 514
$ 502
Construction and land/lots —
—
—
—
—
—
1
36
32
Consumer —
—
—
2
34
33
—
—
—
Commercial:
Commercial and industrial 1
826
826
—
—
$ —
—
—
$ —
Total 3
$ 896
$ 887
3
$ 68
$ 67
5
$ 550
$ 534
Other TDRs:
Retail consumer:
One-to-four family 5
$ 511
$ 502
18
$ 1,452
$ 1,433
25
$ 3,646
$ 3,747
HELOCs - originated 1
27
27
—
—
—
—
—
—
Construction and land/lots —
—
—
1
29
28
—
—
—
Indirect auto finance 3
63
49
1
33
26
—
—
—
Consumer —
—
—
1
2
2
1
2
2
Commercial:
Commercial real estate 1
30
21
3
5,440
5,427
—
—
—
Construction and development 1
182
79
1
182
182
—
—
—
Total 11
$ 813
$ 678
25
$ 7,138
$ 7,098
26
$ 3,648
$ 3,749
Total 15
$ 1,797
$ 1,651
29
$ 7,291
$ 7,249
31
$ 4,198
$ 4,283

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)


	Year Ended June 30,
	2022					2021					2020
	Number of Loans	Pre Modification Outstanding Recorded Investment		Post Modification Outstanding Recorded Investment		Number of Loans	Pre Modification Outstanding Recorded Investment		Post Modification Outstanding Recorded Investment		Number of Loans	Pre Modification Outstanding Recorded Investment		Post Modification Outstanding Recorded Investment
Extended payment terms
Commercial:
Commercial and industrial	—	—		—		—	—		—		1	826		826
Residential real estate

One-to-four family	1	35		34		—	—		—		2	70		61

Consumer	1	50		51		2	28		27		—	—		—
Total extended payment terms	2	85		85		2	28		27		3	896		887

Other TDRs
Commercial real estate
Construction and land development	—	—		—		—	—		—		1	182		79

Commercial real estate - non-owner occupied	—	—		—		—	—		—		1	30		21
Multifamily	—	—		—		1	4,408		3,421		—	—		—
Commercial
Commercial and industrial	2	840		826		—	—		—		—	—		—


Residential real estate
Construction and land development	—	—		—		1	225		213		—	—		—
One-to-four family	2	93		91		4	269		256		5	511		502
HELOCs	1	18		18		2	53		74		1	27		27
Consumer	6	74		61		14	207		144		3	63		49
Total other TDRs	11	1,025		996		22	5,162		4,108		11	813		678
Total	15	$	1,509	$	1,461	24	$	5,190	$	4,135	15	$	1,797	$	1,651

The following table presents loans that were modified as TDRs within the previous 12 months and for which there was a payment default during the periods indicated below:

Year Ended June 30, 2020 Year Ended June 30, 2019 Year Ended June 30, 2018

Number of
Loans

Recorded
Investment

Number of
Loans

Recorded
Investment

Number of
Loans

Recorded
Investment
Other TDRs:
Retail consumer:
One-to-four family —
$ —
1
$ 72
5
$ 277
Consumer —
—
1
2
—
—
Commercial:
Construction and development 1
79
—
—
—
—
Total Other TDRs 1
$ 79
2
$ 74
5
$ 277
Total 1
$ 79
2
$ 74
5
$ 277


	Year Ended June 30,
	2022			2021			2020
	Number of Loans	Recorded Investment		Number of Loans	Recorded Investment		Number of Loans	Recorded Investment









Other TDRs
Commercial real estate
Construction and land development	—	$	—	—	$	—	1	$	79











Consumer	1	25		1	30		—	—

Total	1	$	25	1	$	30	1	$	79

Other TDRs include TDRs that have a below market interest rate and extended payment terms. The Company does not typically forgive principal when restructuring troubled debt.

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

In the ~~determination of~~determining the ~~allowance for loan losses,~~ACL, management considers TDRs for all loan classes, and the subsequent nonperformance in accordance with their modified terms, by measuring ~~impairment~~a reserve on a loan-by-loan basis based on either the value of the loan’s expected future cash flows discounted at the loan’s original effective interest rate or on the collateral value, net of the estimated costs of disposal, if the loan is collateral dependent.

~~Modifications~~Off-Balance Sheet Credit Exposure

The Company maintains a separate reserve for credit losses on off-balance sheet credit exposures, including unfunded loan commitments, which is included in other liabilities on the consolidated balance sheet. The reserve for credit losses on off-balance sheet credit exposures is adjusted as a provision for credit losses in the consolidated statement of income. The estimate includes consideration of the likelihood that funding will occur and ~~deferrals in response~~an estimate of ECLs on commitments expected to ~~COVID-19~~

~~Beginning in March 2020,~~be funded over its estimated life, utilizing the same models and approaches for the Company's other loan portfolio segments described above, as these unfunded commitments share similar risk characteristics as its loan portfolio segments. The Company has identified the unfunded portion of certain lines of credit as unconditionally cancellable credit exposures, meaning the Company ~~began offering short-term loan modifications to assist borrowers during~~can cancel the ~~COVID-19 pandemic. The CARES Act along with a joint agency statement issued~~unfunded commitment at any time. No credit loss estimate is reported for off-balance sheet credit exposures that are unconditionally cancellable by ~~banking agencies and confirmed by FASB staff that short-term modifications made in response to COVID-19 are not TDRs. Accordingly,~~ the Company ~~does not account~~or for undrawn amounts under such ~~loan modifications~~arrangements that may be drawn prior to the cancellation of the arrangement. At June 30, 2022, the allowance for credit losses on off-balance sheet credit exposures included in other liabilities was $3,304.

6. Premises and Equipment

Premises and equipment as ~~TDRs.~~of the dates indicated consist of the following:


	June 30,
	2022		2021
Land	$	24,332	$	25,488

Office buildings	68,385		68,861
Furniture, fixtures and equipment	16,550		16,244
Total	109,267		110,593
Less: accumulated depreciation	(40,173)		(39,684)
Premises and equipment, net	$	69,094	$	70,909

Depreciation expense associated with premises and equipment was $3,986, $3,634, and $3,462 for the years ended June 30, 2022, 2021, and 2020.

7. Goodwill and Core Deposit Intangibles

The carrying amount of the Company's goodwill was $25,638 as of June 30, 2022 and 2021. Amortization expense related to core deposit intangibles was $250, $735, and $1,421 for the years ended June 30, 2022, 2021, and 2020, respectively. As of June 30, ~~2020, modifications totaling $42,000 and $509,300 had been granted in retail consumer loans and commercial loans, respectively.~~

~~HomeTrust Bank is offering payment and financial relief programs~~2022, the estimated amortization expense for ~~borrowers impacted by COVID-19. These programs include loan payment deferrals for up to 90 days (which can be renewed for another 90 days under certain circumstances) waived late fees, and suspension~~each of ~~foreclosure proceedings and repossessions. We have received numerous requests from borrowers for some type of payment relief. The breakout by loan type~~the next two years is as follows:



2023	$	90
2024	3




Total	$	93

8. Deposit Accounts

Payment Deferrals by Loan Types⁽¹⁾

March 31, 2020 June 30, 2020 August 31, 2020
$ Deferral Percent of Total Loan Portfolio $ Deferral Percent of Total Loan Portfolio $ Deferral Percent of Total Loan Portfolio
Lodging 26,815
1.0 % 108,171
4.0 % 64,686
2.4 %
Other commercial real estate, construction and development, and commercial and industrial 116,198
4.4
367,443
13.7
43,056
1.6
Equipment finance 19,443
0.7
33,693
1.3
4,547
0.2
One-to-four family 10,802
0.4
36,821
1.4
2,360
0.1
Other consumer loans 3,546
0.1
5,203
0.2
589
—
Total $ 176,804
6.6 % $ 551,331
20.5 % $ 115,238
4.3 %
Deposit accounts at the dates indicated consist of the following:

~~(1) �� Modified loans are not included in classified assets or nonperforming asset.~~



	June 30,
	2022		2021
Noninterest-bearing accounts	$	745,746	$	636,414
NOW accounts	654,981		644,958
Money market accounts	969,661		975,001
Savings accounts	238,197		226,391
Certificates of deposit	491,176		472,777
Total	$	3,099,761	$	2,955,541

~~See Note 1 Summary of Significant Accounting Policies for more details.~~Deposits received from executive officers and directors and their associates totaled approximately $1,012 and $4,618 at June 30, 2022 and 2021, respectively.

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

6. ~~Premises and Equipment~~

~~Premises and equipment as of the dates indicated consist of the following:~~

June 30,
2020 2019
Land $ 20,785
$ 19,730
Land held under capital lease⁽¹⁾
—
2,052
Office buildings 59,333
58,952
Furniture, fixtures and equipment 15,724
15,918
Total 95,842
96,652
Less accumulated depreciation (37,380 ) (35,601 )
Premises and equipment, net $ 58,462
$ 61,051

~~(1) Land held under capital lease was reclassed to other assets upon the adoption of ASC 842. See additional details in footnote 1 and 12.~~

7. ~~Accrued Interest Receivable~~

~~Accrued interest receivable as of the dates indicated consists of the following:~~

June 30,
2020 2019
Loans $ 11,360
$ 9,433
Securities available for sale 710
690
Other 242
410
Total $ 12,312
$ 10,533

8. ~~Real Estate Owned~~

~~The activity within REO for the periods shown is as follows:~~

Year Ended
June 30,
2020 2019
Balance at beginning of period $ 2,929
$ 3,684
Transfers from loans 46
731
Sales, net of gain/loss (2,432 ) (1,191 )
Writedowns (206 ) (295 )
Balance at end of period $ 337
$ 2,929

At June 30, 2020 and 2019, the Bank had $97 and $1,018, respectively, of foreclosed residential real estate property in REO. The recorded investment in consumer mortgage loans collateralized by residential real estate in the process of foreclosure totaled $1,318 and $243 for June 30, 2020 and 2019, respectively.

9. ~~Goodwill and Core Deposit Intangibles~~

~~The carrying amount of the Company's goodwill was $25,638 as of June 30, 2020 and 2019.~~

~~Amortization expense related to core deposit intangibles was $1,421, $2,029, and $2,645 for the years ended June 30, 2020, 2019, and 2018, respectively.~~

As of June 30, ~~2020, estimated amortization expense for each of the next five years is as follows:~~

2021 $ 734
2022 251
2023 90
2024 3
2025 —
Total $ 1,078

~~HOMETRUST BANCSHARES, INC. AND SUBSIDIARY~~

~~Notes to Consolidated Financial Statements~~

~~(Dollars in thousands, except per share data)~~

~~10.~~ ~~Deposit Accounts~~

~~Deposit accounts at the dates indicated consist of the following:~~

Weighted Average
Interest Rates
June 30, June 30,
2020 2019 2020 2019
Noninterest-bearing accounts $ 429,901
$ 294,322
— % — %
NOW accounts 582,299
452,295
0.10 % 0.15 %
Money market accounts 836,738
691,172
0.46 % 0.89 %
Savings accounts 197,676
177,278
0.07 % 0.12 %
Certificates of deposit 739,142
712,190
1.45 % 1.99 %
Total $ 2,785,756
$ 2,327,257
0.54 % 0.91 %

Deposits received from executive officers and directors and their associates totaled approximately $4,307 and $4,448 at June 30, 2020 and 2019, respectively. As part of our system conversion, certain escrow and official check accounts are now included in noninterest-bearing accounts. As of June 30, 2019, these accounts totaled $8,208 and were included in other liabilities.

~~As of June 30, 2020,~~2022, scheduled maturities of certificates of deposit are as follows:


2021	$	598,777
2022	97,507
2023	26,833		2023	$	428,734
2024	11,207		2024	33,134
2025	4,818		2025	17,401
2026			2026	6,440
2027			2027	5,467
Thereafter	—		Thereafter	—
Total	$	739,142	Total	$	491,176

Certificates of deposit with balances of $250 or greater totaled ~~$118,308~~$156,558 and ~~$93,654~~$75,447 at June 30, ~~2020~~2022 and ~~2019,~~2021, respectively. Generally, deposit amounts in excess of $250 are not federally insured.

~~Interest expense on deposits at the dates indicated consists of the following:~~

9. Borrowings

June 30,
2020 2019 2018
NOW accounts $ 1,627
$ 1,251
$ 970
Money market accounts 6,910
5,102
2,442
Savings accounts 195
245
295
Certificates of deposit 14,105
9,159
3,051
Total $ 22,837
$ 15,757
$ 6,758

~~11.~~ ~~Borrowings~~

Borrowings consist of the following at the dates indicated:

June 30,
2020 2019
Balance
Weighted Average
Rate
Balance
Weighted Average
Rate
FHLB Advances $ 475,000
1.39 % $ 680,000
2.10 %

~~HOMETRUST BANCSHARES, INC. AND SUBSIDIARY~~

~~Notes to Consolidated Financial Statements~~

~~(Dollars in thousands, except per share data)~~

~~The scheduled maturity dates, call dates, and related interest rates on FHLB advances at June 30, 2020:~~

Maturity Date Interest Rate Call Date Outstanding Amount
3/6/2028 1.73% 9/8/2020 $ 100,000
3/22/2028 1.82% 9/22/2020 50,000
6/5/2028 1.87% 9/8/2020 50,000
9/13/2028 1.76% 9/14/2020 25,000
11/24/2028 2.07% 8/26/2020 25,000
11/24/2028 1.79% 8/26/2020 25,000
7/23/2029 0.99% 7/23/2020 50,000
8/8/2029 0.92% 8/10/2020 50,000
2/27/2030 0.63% 2/26/2021 50,000
3/4/2030 0.72% 3/4/2022 50,000
$ 475,000


	June 30,
	2022				2021
	Balance		Weighted Average Rate		Balance		Weighted Average Rate



FHLB Advances	$	—	—	%	$	115,000	0.16	%

All qualifying one-to-four family ~~first mortgage~~ loans, HELOCs, commercial real estate loans, and FHLB of Atlanta stock ~~and certain investment securities were~~are pledged as collateral to secure outstanding FHLB advances. During the year ended June 30, 2021, the Company paid $22.7 million in prepayment penalties on FHLB advances.

At June 30, ~~2020~~2022 and ~~2019,~~2021, the Company had the ability to borrow ~~$186,222~~$277,561 and ~~$89,499,~~$289,411, respectively, ~~in additional~~through FHLB advances. At ~~June 30, 2020 and 2019,~~these same dates, the Company had an unused line of credit with the FRB ~~for $109,242~~in the amounts of $68,230 and ~~$130,036, respectively. At June 30, 2020~~$92,913 and ~~2019, the Company had~~ unused lines of credit with three unaffiliated banks for ~~$100,000~~$120,000 and ~~$70,000,~~$100,000, respectively.

~~12.~~ 10. Leases

As Lessee - Operating Leases

~~Company~~The Company's operating leases primarily include office space and bank branches. Certain leases include one or more options to renew, with renewal terms that can extend the lease term up to 15 additional years. The exercise of lease renewal options is at ~~our~~management's sole discretion. When it is reasonably certain that wethe Company will exercise our option to renew or extend the lease term, that option is included in estimating the value of the ROU and lease liability. ~~At June 30, 2020, we did not have any leases that had not yet commenced for which we had created a ROU asset and a lease liability. Our~~The Company's lease agreements do not contain any material residual value guarantees or material restrictive covenants. Most of ~~our~~the Company's lease agreements include periodic rate adjustments for inflation. The depreciable life of ROU assets and leasehold improvements are limited to the shorter of the useful life or the expected lease term. Leases with an initial term of 12 months or less are not recorded on ~~our~~the Company's Consolidated Balance ~~Sheets; we recognize~~Sheets. The Company recognizes lease ~~expenses~~expense for these leases over the lease term.

The following tables present supplemental balance sheet information related to operating leases. ROU assets are included in other assets and lease liabilities are included in other liabilities.

Supplemental Balance Sheet Information: June 30, 2020
ROU assets $ 4,601
Lease liabilities 4,590
Weighted-average remaining lease terms 5.02
Weighted-average discount rate 2.97 %

~~The following schedule summarizes aggregate future minimum lease payments under these operating leases at June 30, 2020:~~


	June 30,
	2022			2021
Supplemental balance sheet information
ROU assets	$	5,846		$	5,498

Lease liabilities	$	6,641		$	5,926

Weighted-average remaining lease terms (years)	10.80			9.49
Weighted-average discount rate	2.90		%	3.18		%

Fiscal year ending June 30:
2021 $ 1,242
2022 1,115
2023 1,063
2022 593
2023 287
Thereafter 676
Total of future minimum payments $ 4,976

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

The following schedule summarizes aggregate future minimum lease payments under these operating leases at June 30, 2022:


Fiscal year ending June 30
2023	$	1,425
2024	981
2025	680
2026	555
2027	573
Thereafter	3,772
Total undiscounted minimum lease payments	7,986
Less: amount representing interest	(1,345)
Total lease liability	$	6,641

The following table presents components of operating lease expense ~~for~~as of the ~~year ended June 30, 2020:~~dates indicated:

Year Ended June 30, 2020
Operating lease cost (included in occupancy expense) $ 1,821
Sublease income (included in other, net noninterest income) (242 )
Total operating lease expense, net 1,579


	Year Ended June 30,
	2022		2021
Operating lease cost (included in occupancy expense, net)	$	1,559	$	1,637
Variable lease cost (included in occupancy expense, net)	9		24
Sublease income (included in other noninterest income)	(189)		(207)
Total operating lease expense, net	$	1,379	$	1,454

As Lessee - Finance Lease

The Company currently leases land for one of its branch office locations under a finance ~~lease.~~lease. The ROU asset for the finance lease totaled $2,052 at June 30, ~~2020~~2022 and 2021 and is included in other assets. ~~As of June 30, 2019, the amount was recorded in premises and equipment, net.~~ The corresponding lease liability totaled ~~$1,843~~$1,763 and $1,804 at June 30, ~~2020~~2022 and 2021, respectively, and is included in other liabilities. For the ~~year~~years ended June 30, ~~2020,~~2022 and 2021, interest expense on the lease liability totaled ~~$97.~~$93 and $95, respectively. The finance lease has a maturity date of July 2028 and a discount rate of 5.18%. ~~Upon adoption of ASC 842, the capital lease obligation for June 30, 2019 was also reclassified to other liabilities.~~

The following schedule summarizes aggregate future minimum lease payments under this finance lease obligation at June 30, ~~2020:~~2022:


Fiscal year ending June 30:
2021	$	134
2022	134
2023	134
Fiscal year ending June 30				Fiscal year ending June 30
2023	145			2023	$	134
2024	146			2024	145
2025				2025	146
2026				2026	146
2027				2027	146
Thereafter	1,848			Thereafter	1,557
Total minimum lease payments	2,541
Total undiscounted minimum lease payments				Total undiscounted minimum lease payments	2,274
Less: amount representing interest	(698		)	Less: amount representing interest	(511)
Present value of net minimum lease payments	$	1,843
Total lease liability				Total lease liability	$	1,763

Supplemental lease cash flow information ~~for~~as of the ~~year ended June 30, 2020:~~dates indicated:


				Year Ended June 30,
				2022		2021
ROU assets - noncash additions (operating leases)	$	5,296	ROU assets - noncash additions (operating leases)	$	1,186	$	2,586
ROU assets - noncash addition (finance lease)	2,052

Cash paid for amounts included in the measurement of lease liabilities (operating leases)	2,142		Cash paid for amounts included in the measurement of lease liabilities (operating leases)	1,438		2,036
Cash paid for amounts included in the measurement of lease liabilities (finance leases)	134		Cash paid for amounts included in the measurement of lease liabilities (finance leases)	134		134

As Lessor - General

The Company leases equipment to commercial end users under operating and finance lease arrangements. ~~Our~~The Company's equipment finance leases consist mainly of construction, transportation, ~~medical,~~healthcare, and manufacturing equipment. Many of ~~our~~its operating and finance leases offer the lessee the option to purchase the equipment at fair value or for a nominal fixed purchase option; and most of the leases that do not have a nominal purchase option include renewal provisions resulting in some leases continuing beyond initial contractual terms. ~~Our~~The Company's leases do not include early termination options, and continued rent payments are due if leased equipment is not returned at the end of the lease.

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

As Lessor - Operating Leases

Operating lease income is recognized as a component of noninterest income on a straight-line basis over the lease term. Lease terms range from 1one to 5five years. Assets related to operating leases are included in other assets and the corresponding depreciation expense is recorded on a straight-line basis as a component of other noninterest expense. The net book value of leased assets totaled ~~$21,595~~$20,075 and ~~$9,995~~$25,932 with a residual value of ~~$12,370~~$12,874 and ~~$5,800~~$15,330 as of June 30, ~~2020~~2022 and ~~2019,~~2021, respectively. ~~For the years ended June 30, 2020 and 2019,~~

The following table presents total equipment finance operating lease income ~~totaled $3,356~~ and ~~$936, respectively. For the years ended June 30, 2020 and 2019,~~ depreciation expense ~~totaled $2,394 and $633, respectively.~~as of the dates indicated:

~~HOMETRUST BANCSHARES, INC. AND SUBSIDIARY~~

~~Notes to Consolidated Financial Statements~~

~~(Dollars in thousands, except per share data)~~


	Year Ended June 30,
	2022		2021
Operating lease income	$	6,392	$	5,601
Depreciation expense	5,362		5,864

The following schedule summarizes aggregate future minimum ~~operating~~ lease payments to be received at June 30, ~~2020:~~2022:


Fiscal year ending June 30:
2021	$	4,732
2022	3,643
Fiscal year ending June 30			Fiscal year ending June 30
2023	2,061		2023	$	5,080
2024	649		2024	3,010
2025	104		2025	998
2026			2026	355
2027			2027	113
Thereafter	—		Thereafter	—
Total of future minimum payments	$	11,189	Total of future minimum payments	$	9,556

As Lessor - Finance Leases

Finance lease income is recognized as a component of loan interest income over the lease term. The finance leases are included as a component of the equipment finance class of financing receivables under the commercial loans segment of the loan ~~segment.~~portfolio. For the years ended June 30, ~~2020~~2022 and ~~2019,~~2021, total interest income on equipment finance leases totaled ~~$1,595~~$3,057 and ~~$775,~~$2,444, respectively.

The ~~following table presents components~~lease receivable component of finance lease net investment included within equipment finance class of financing ~~receivables:~~

June 30, 2020
Lease receivables $ 44,927
receivables was $62.2 million and $63.3 million at June 30, 2022 and 2021, respectively.

The following schedule summarizes aggregate future minimum finance lease payments to be received at June 30, ~~2020:~~2022:


Fiscal year ending June 30
2023	$	21,287
2024	18,615
2025	13,772
2026	9,299
2027	4,578
Thereafter	1,047
Total undiscounted minimum payments	68,598
Less: amount representing interest	(6,410)
Total lease receivable	$	62,188

Fiscal year ending June 30:
2021 $ 11,453
2022 11,054
2023 10,697
2024 8,813
2025 4,848
Thereafter 2,667
Total minimum payments 49,532
Less: amount representing interest (4,605 )
Total $ 44,927

~~13.~~ ~~Income Taxes~~

~~Income tax expense as of the dates indicated consisted of:~~

June 30,
2020 2019 2018
Current:
Federal $ 80
$ 755
$ 291
State 748
690
324
Total current expense (benefit) 828
1,445
615
Deferred:
Federal 5,184
5,404
7,909
State 12
267
625
Adjustment due to the Tax Act —
(325 ) 17,587
Total deferred expense 5,196
5,346
26,121
Total income tax expense $ 6,024
$ 6,791
$ 26,736

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

11. Income Taxes

Income tax expense as of the dates indicated consisted of:


	Year Ended June 30,
	2022		2021		2020
Current
Federal	$	2,411	$	(340)	$	80
State	730		188		748
Total current expense (benefit)	3,141		(152)		828
Deferred
Federal	5,992		3,374		5,184
State	592		199		12

Total deferred expense	6,584		3,573		5,196

Total income tax expense	$	9,725	$	3,421	$	6,024

The provision for income taxes differs from the amount of income tax determined by applying the applicable U.S. statutory federal income tax rate to income before income taxes as a result of the following differences for the periods indicated:


	Year Ended June 30,																Year Ended June 30,
	2020					2019					2018						2022				2021				2020
	$			Rate		$			Rate		$			Rate			Amount		Rate		Amount		Rate		Amount		Rate
Tax at federal income tax rate	$	6,049		21	%	$	7,127		21	%	$	9,617		28	%	Tax at federal income tax rate	$	9,529	21	%	$	4,010	21	%	$	6,049	21	%
Increase (decrease) resulting from:
Increase (decrease) resulting from																Increase (decrease) resulting from
Tax exempt income	(872		)	(3	)%	(855		)	(2	)%	(1,075		)	(3	)%	Tax exempt income	(844)		(2)		(911)		(5)		(872)		(3)
Change in valuation allowance for deferred tax assets, allocated to income tax expense	—			—	%	(325		)	(1	)%	87			—	%

State tax, net of federal benefit	600			2	%	756			2	%	688			2	%	State tax, net of federal benefit	818		2		306		2		600		2
Change in deferred tax assets due to the Tax Act	—			—	%	—			—	%	17,587			50	%

Other	247			1	%	88			—	%	(168		)	(1	)%	Other	222		—		16		—		247		1
Total	$	6,024		21	%	$	6,791		20	%	$	26,736		76	%	Total	$	9,725	21	%	$	3,421	18	%	$	6,024	21	%

The sources and tax effects of temporary differences that give rise to significant portions of the deferred tax assets (liabilities) at June 30, ~~2020~~2022 and ~~2019~~2021 are presented below:


	June 30,
	2022		2021
Deferred tax assets

Allowance for credit losses	$	8,796	$	8,158
Deferred compensation and post-retirement benefits	8,407		8,349

Impairments on real estate owned	61		110
Other than temporary impairment on investments	—		2,205
Net operating loss carryforward	3,353		4,489
Discount from business combinations	1,228		2,474
Unrealized loss on securities held for sale	718		—
Share-based compensation expense	1,860		2,166
Other	2,000		1,412
Total deferred tax assets	26,423		29,363


Deferred tax liabilities
Depreciable basis of fixed assets	(8,565)		(6,555)
Deferred loan fees	(774)		(753)
FHLB stock, book basis in excess of tax	(89)		(89)
Unrealized gain on debt securities available for sale	—		(452)
BOLI available for redemption	(4,679)		(3,902)
Other	(829)		(711)
Total deferred tax liabilities	(14,936)		(12,462)
Net deferred tax assets	$	11,487	$	16,901

June 30,
2020 2019
Deferred tax assets:
Alternative minimum tax credit $ —
$ 4,799
Allowance for loan losses 6,456
4,685
Deferred compensation and post-retirement benefits 8,637
8,988
Accrued vacation and sick leave 18
18
Impairments on real estate owned 198
461
Other than temporary impairment on investments 2,207
2,232
Net operating loss carryforward 4,513
5,092
Discount from business combination 2,192
2,373
Stock compensation plans 2,279
2,162
Other 1,256
1,140
Total gross deferred tax assets 27,756
31,950
Deferred tax (liabilities):

Depreciable basis of fixed assets (6,017 ) (1,089 )
Deferred loan fees (603 ) (520 )
FHLB stock, book basis in excess of tax (89 ) (89 )
Unrealized gain on securities available for sale (602 ) (219 )
Other (4,111 ) (3,510 )
Total gross deferred tax liabilities (11,422 ) (5,427 )
Net deferred tax assets $ 16,334
$ 26,523

~~The enactment of the Tax Act and subsequent Internal Revenue Service guidelines reduced the statutory federal corporate income tax rate~~HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to ~~21% effective January 1, 2018, requiring the Company to revalue its DTA. The resulting $17,600~~Consolidated Financial Statements

(Dollars in adjustments were reflected as an increase to the Company's income tax expense with an additional $325 in income tax expense during the fiscal year ended June 30, 2018 to establish a tax valuation allowance on our AMT credits. The valuation allowance of $325 was reversed during the year ended June 30, 2019 and the remaining AMT credit of $4,601 was reclassed to other assets from deferred taxes during the year ended June 30, 2020 based on clarifying guidance released by the Internal Revenue Service. In addition, our June 30, 2018 fiscal year end required the use of a blended federal income tax rate as prescribed by the Internal Revenue Code. The blended federal income tax rate of 27.5% was retroactively effective July 1, 2017 and was used for the entire fiscal year ended June 30, 2018.thousands, except per share data)

The Company had federal NOL carry forwards of ~~$21,488~~$15,967 and ~~$24,248~~$21,377 as of June 30, ~~2020~~2022 and June 30, ~~2019,~~2021, respectively, with a recorded tax benefit of ~~$4,513~~$3,353 and ~~$5,092~~$4,489 included in deferred tax assets. The majority of these NOLs will expire for federal tax purposes from 2028 through 2036, if not previously used.

~~HOMETRUST BANCSHARES, INC. AND SUBSIDIARY~~

~~Notes to Consolidated Financial Statements~~

~~(Dollars in thousands, except per share data)~~

Retained earnings at June 30, ~~2020~~2022 and ~~2019~~2021 include $19,570 representing pre-1988 tax bad debt reserve base year amounts for which no deferred tax liability has been provided since these reserves are not expected to reverse and may never reverse. Circumstances that would require an accrual of a portion or all of this unrecorded tax liability are a failure to meet the definition of a bank, dividend payments in excess of current year or accumulated earnings and profits, or other distributions in dissolution or liquidation of the Bank. The Company is no longer subject to examination for federal and state purposes for tax years prior to ~~2016.~~2018.

~~14.~~ 12. Employee Benefit Plans

The HomeTrust Bank KSOP Plan is comprised of two components, the 401(k) Plan and the ESOP. The KSOP benefits employees ~~with at least 1000 hours of service during a 12-month period and~~ who have attained age ~~21.~~21 and who are employed on the last day of the plan year, or separated during the plan year due to death, disability, or after meeting normal retirement age. Under the 401(k), the Company matches employee contributions at 50% of employee deferrals up to 6% of each employee’s eligible compensation. The Company may also make discretionary profit sharing contributions for the benefit of all eligible participants as long as total contributions do not exceed applicable limitations. Employees become fully vested in the Company’s contributions after ~~six~~four years of service. Under the ESOP, the amount of the Bank's annual contribution is ~~discretionary,~~discretionary; however, it must be sufficient to pay the annual loan payment to the Company.

The Company’s expense for 401(k) contributions to this plan was ~~$782, $810,~~$911, $914, and ~~$737~~$782 for the years ended June 30, ~~2020, 2019,~~2022, 2021, and ~~2018,~~2020, respectively. The Company's expense related to the ESOP for the fiscal ~~year~~years ended June 30, 2022, 2021, and 2020 ~~2019,~~was $1,502, $1,125, and ~~2018 was~~ $1,195, ~~$1,422, and $1,367,~~ respectively.

Shares held by the ESOP at the dates indicated include the following:


	June 30,					June 30,
	2020		2019			2022		2021
Unallocated ESOP shares	634,800		687,700		Unallocated ESOP shares	529,000		581,900
Allocated ESOP shares	370,300		317,400		Allocated ESOP shares	502,550		449,650
ESOP shares committed to be released	52,900		52,900		ESOP shares committed to be released	26,450		26,450
Total ESOP shares	1,058,000		1,058,000		Total ESOP shares	1,058,000		1,058,000
Fair value of unallocated ESOP shares	$	10,157	$	17,289	Fair value of unallocated ESOP shares	$	13,225	$	16,235

June 30,
2020 June 30,
2019
Assets:
Cash and equivalents $ 3,888
$ 8,481
Certificates of deposit in other banks —
746
Total loans —
1,243
Allowance for loan losses —
(4 )
Net loans —
1,239
REO 143
621
Investment in bank subsidiary 396,667
389,926
ESOP loan receivable 6,918
7,412
Other assets 731
510
Total Assets $ 408,347
$ 408,935
Liabilities and Stockholders’ Equity:
Other liabilities 84
39
Stockholders’ Equity 408,263
408,896
Total Liabilities and Stockholders’ Equity $ 408,347
$ 408,935

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)


Condensed Statement of Cash Flows	Year Ended June 30,
	2022		2021		2020
Operating activities
Net income	$	35,653	$	15,675	$	22,783
Adjustments to reconcile net income to net cash provided by operating activities:
Provision (benefit) for credit losses	—		—		(4)
(Gain) loss on sale of REO	(3)		—		249
Increase in other assets	(11)		(435)		(221)
Equity in undistributed bank subsidiary income	(36,281)		(16,246)		(23,522)
ESOP compensation expense	1,502		1,125		1,195
Share-based compensation expense	2,152		2,102		1,822
Increase (decrease) in other liabilities	(37)		(61)		45
Net cash provided by operating activities	2,975		2,160		2,347
Investing activities

Proceeds from maturities of CDs in other banks	—		—		746



Decrease in loans	—		—		1,243


Increase in investment in bank subsidiary	(1,707)		(1,330)		(1,380)
Dividends from bank subsidiary	38,389		21,416		19,445

ESOP principal payments received	511		253		494
Proceeds from sale of REO	146		—		229


Net cash provided by investing activities	37,339		20,339		20,777
Financing activities


Common stock repurchased	(43,348)		(16,155)		(24,484)
Cash dividends paid	(5,452)		(5,018)		(4,552)
Retired stock	(345)		(204)		(222)
Exercised stock options	6,081		4,592		1,541
Net cash used in financing activities	(43,064)		(16,785)		(27,717)
Net increase (decrease) in cash and cash equivalents	(2,750)		5,714		(4,593)
Cash and cash equivalents at beginning of period	9,602		3,888		8,481
Cash and cash equivalents at end of period	$	6,852	$	9,602	$	3,888

~~Condensed statement of income~~

June 30,
2020 June 30,
2019 June 30,
2018
Income:
Interest income $ 217
$ 329
$ 456
Other income 1
54
44
Equity earnings in Bank subsidiary 23,522
27,287
8,427
Total income 23,740
27,670
8,927
Expense:
Management fee expense 399
407
385
REO expense 5
11
34
Loss on sale and impairment of REO 249
114
158
Recovery of loan losses (4 ) (259 ) (131 )
Other expense 258
251
246
Total expense 907
524
692
Income Before Income Taxes 22,833
27,146
8,235
Income Tax Expense 50
—
—
Net Income $ 22,783
$ 27,146
$ 8,235

~~Condensed statement of cash flows~~

June 30,
2020 June 30,
2019 June 30,
2018
Operating Activities:
Net income $ 22,783
$ 27,146
$ 8,235
Adjustments to reconcile net income to net cash provided by operating activities:
Recovery of loan losses

(4 ) (259 ) (131 )
Loss on sale and impairment of REO 249
114
158
Decrease (increase) in other assets (221 ) 52
291
Equity in undistributed income of Bank (23,522 ) (27,287 ) (8,427 )
ESOP compensation expense 1,195
1,422
1,367
Restricted stock and stock option expense 1,822
1,601
3,027
Decrease (increase) in other liabilities 45
—
(48 )
Net cash provided by operating activities 2,347
2,789
4,472
Investing Activities:
Maturities of certificates of deposit in other banks 746
248
6,217
Repayment of loans 1,243
2,796
1,514
Increase in investment in Bank subsidiary (1,380 ) (1,556 ) (1,367 )
Dividend from subsidiary 19,445
13,454
—
ESOP principal payments received 494
484
472
Proceeds from sale of REO 229
70
499
Net cash provided by investing activities 20,777
15,496
7,335
Financing Activities:
Common stock repurchased (24,484 ) (30,638 ) —
Cash dividends paid (4,552 ) (3,176 ) —
Retired stock (222 ) (205 ) (494 )
Exercised stock options 1,541
1,173
651
Net cash provided by (used in) financing activities (27,717 ) (32,846 ) 157
Net Increase (Decrease) in Cash and Cash Equivalents (4,593 ) (14,561 ) 11,964
Cash and Cash Equivalents at Beginning of Period 8,481
23,042
11,078
Cash and Cash Equivalents at End of Period $ 3,888
$ 8,481
$ 23,042

~~HOMETRUST BANCSHARES, INC. AND SUBSIDIARY~~

~~Notes to Consolidated Financial Statements~~

~~(Dollars in thousands, except per share data)~~

~~21.~~ 19. Fair Value of Financial Instruments

~~The Company utilizes fair~~Fair value ~~measurements~~is the exchange price that would be received for an asset or paid to ~~record fair value adjustments to certain assets and to determine fair value disclosures. Securities available~~transfer a liability (exit price) in the principal or most advantageous market for ~~sale~~the asset or liability in an orderly transaction between market participants on the measurement date. There are ~~recorded at fair value on a recurring basis. Additionally, from time to time, the Company~~three levels of inputs that may be ~~required~~used to ~~record at~~measure fair ~~value~~values:

Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

Level 2: Significant other ~~assets on a nonrecurring basis,~~observable inputs other than Level 1 prices such as ~~impaired loans. These nonrecurring fair value adjustments typically involve application of lower of cost~~quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market ~~accounting~~data.

Level 3: Significant unobservable inputs that reflect a company's own assumptions about the assumptions that market participants would use in pricing an asset or ~~write-downs of individual assets. The Company measures~~liability.

A financial instrument's level within the fair value ~~of loans receivable under the exit price notion. The fair value of nonperforming loans~~hierarchy is based on the ~~underlying value~~lowest level of any input that is significant to the ~~collateral.~~

~~Fair Value Hierarchy~~

~~The Company groups assets at~~ fair value ~~in three levels, based on the markets in which the assets are traded and the reliability of the assumptions used to determine fair value. These levels are:~~


~~Level 1:~~	~~Valuation is based upon quoted prices for identical instruments traded in active markets.~~


~~Level 2:~~	Valuation is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market.


~~Level 3:~~	Valuation is generated from model-based techniques that use at least one significant assumption not observable in the market. These unobservable assumptions reflect estimates of assumptions that market participants would use in pricing the asset. Valuation techniques include use of option pricing models, discounted cash flow models and similar techniques.

~~Following~~measurement. The following is a description of valuation methodologies used for assets recorded at fair value. The Company does not have any liabilities recorded at fair value.

~~Investment Securities Available for Sale~~

~~Securities~~

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

Financial Assets Recorded at Fair Value

The following table presents financial assets measured at fair value on a recurring basis at the dates indicated:


	June 30, 2022
	Total		Level 1		Level 2		Level 3
U.S government agencies	$	18,459	$	—	$	18,459	$	—
MBS, residential	47,233		—		47,233		—
Municipal bonds	5,558		—		5,558		—
Corporate bonds	55,728		—		55,728		—

Total	$	126,978��	$	—	$	126,978	$	—


	June 30, 2021
	Total		Level 1		Level 2		Level 3
U.S government agencies	$	19,073	$	—	$	19,073	$	—
MBS, residential	43,404		—		43,404		—
Municipal bonds	9,551		—		9,551		—
Corporate bonds	84,431		—		84,431		—

Total	$	156,459	$	—	$	156,459	$	—

Debt securities available for sale are valued on a recurring basis at quoted market prices where available. If quoted market prices are not available, fair values are based on quoted prices of comparable securities. Level 1 securities include those traded on an active exchange, such as the New York Stock Exchange or U.S. Treasury securities that are traded by dealers or brokers in active over-the-counter markets and money market funds. Level 2 securities include MBS and debentures issued by GSEs, municipal bonds, and corporate debt securities. The Company has no Level 3 securities.

~~Impaired Loans~~There were no transfers between levels during the years ended June 30, 2022 and 2021.

The ~~Company does not record loans~~following table presents financial assets measured at fair value on a ~~recurring basis. From time to time, however, a~~non-recurring basis at the dates indicated:


	June 30, 2022
	Total		Level 1		Level 2		Level 3
Collateral dependent loans





Commercial loans
Commercial and industrial	$	415	$	—	$	—	$	415



Residential real estate loans

One-to-four family	—		—		—		—


Total	$	415	$	—	$	—	$	415


	June 30, 2021
	Total		Level 1		Level 2		Level 3
Collateral dependent loans
Commercial real estate loans

Commercial real estate - owner occupied	$	1,422	$	—	$	—	$	1,422

Multifamily	3,421		—		—		3,421
Commercial loans
Equipment finance	275		—		—		275
Total	$	5,118	$	—	$	—	$	5,118

A loan is considered ~~impaired~~to be collateral dependent when, based on current information and ~~an allowance for loan losses is established. Loans for which it is probable that payment of interest and principal will not be made in accordance with~~events, the ~~contractual terms~~Company expects repayment of the ~~loan agreement are considered impaired. Once a loan~~financial assets to be provided substantially through the operation or sale of the collateral and the Company has determined that the borrower is ~~identified~~experiencing financial difficulty as ~~individually impaired,~~of the ~~fair value is estimated using one of two ways, which include collateral value and discounted cash flows. The Company reviews all impaired~~measurement date. For real estate loans, ~~each quarter to determine if an allowance is necessary. Those impaired loans not requiring an allowance represent loans for which~~ the fair value of the ~~expected repayments or~~loan's collateral ~~exceed~~is determined by a third party appraisal, which is then adjusted for the ~~recorded investments in such loans.~~

Loans are considered collateral dependent if repayment is expected solely from the collateral. For these collateral dependent impaired loans, the Company obtains updated appraisals at least annually. These appraisals are reviewed for appropriatenessestimated selling and ~~then discounted for estimated~~ closing costs related to ~~determine if an allowance is necessary. As part~~liquidation of the ~~quarterly review~~collateral (typically ranging from 8% to 12% of ~~impaired~~the appraised value). For this asset class, the actual valuation methods (income, sales comparable, or cost) vary based on the status of the project or property. Additional discounts of 5% to 15% may be applied depending on the age of the appraisals. The unobservable inputs may vary depending on the age of the appraisals. The unobservable inputs may vary depending on the individual asset with no one of the three methods being the predominant approach. For non-real estate loans, ~~the Company reviews these appraisals to determine if any additional discounts to~~ the fair value are necessary. If a current appraisal is not obtained, the Company determines whether a discount is needed to the value from the original appraisal based on the decline in value of similar properties with recent appraisals. For loans that are not collateral dependent, estimated fair value is based on the present value of expected future cash flows using the interest rate implicit in the original agreement. Impaired loans where a charge-off has occurred or an allowance is established during the period being reported require classification in the fair value hierarchy. The Company records such impaired loans as a nonrecurring Level 3 in the fair value hierarchy.

~~Loans Held for Sale~~

Loans held for sale are adjusted to lower of cost or fair value. Fair value is based on commitments on hand from investors or, if commitments have not yet been obtained, what investors are currently offering for loans with similar characteristics. The Company considers all loans held for sale carried at fair value as nonrecurring Level 3.

~~Real Estate Owned~~

~~REO is considered held for sale and is adjusted to fair value less estimated selling costs upon transfer~~ of the ~~loan to foreclosed assets. Fair~~loan's collateral may be determined using an appraisal, net book value isper the borrower's financial statements, or aging reports, adjusted or discounted based upon independent market prices, appraised value of the collateral or management’s estimation of the value of the collateral. The Company considers all REO that has been charged off or received an allowance during the period as nonrecurring Level 3.on

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

~~Financial Assets Recorded at Fair Value on a Recurring Basis~~management's historical knowledge, changes in market conditions from the time of the valuation, and management's expertise and knowledge of the customer and customer's business.

The ~~following table presents financial assets measured at~~stated carrying value and estimated fair value ~~on a recurring basis at the dates indicated:~~amounts of financial instruments as of June 30, 2022 and June 30, 2021, are summarized below:


	June 30, 2022
	Carrying Value		Fair Value		Level 1		Level 2		Level 3
Assets
Cash and cash equivalents	$	105,119	$	105,119	$	105,119	$	—	$	—
Commercial paper, net	194,427		194,427		194,427		—		—
Certificates of deposit in other banks	23,551		23,551		—		23,551		—
Debt securities available for sale	126,978		126,978		—		126,978		—
Loans held for sale	79,307		80,489		—		—		80,489
Loans, net	2,734,605		2,687,293		—		—		2,687,293
FHLB and FRB stock	9,326		N/A		N/A		N/A		N/A
SBIC investments	12,758		12,758		—		—		12,758

Accrued interest receivable	8,573		8,573		24		580		7,969
Liabilities
Noninterest-bearing and NOW deposits	1,400,727		1,400,727		—		1,400,727		—
Money market accounts	969,661		969,661		—		969,661		—
Savings accounts	238,197		238,197		—		238,197		—
Certificates of deposit	491,176		485,452		—		485,452		—

Accrued interest payable	80		80		—		80		—

June 30, 2020
Description Total Level 1 Level 2 Level 3
U.S government agencies $ 4,173
$ —
$ 4,173
$ —
Residential MBS of U.S. government agencies and GSE 48,355
—
48,355
—
Municipal bonds 16,631
—
16,631
—
Corporate bonds 58,378
—
58,378
—
Total $ 127,537
$ —
$ 127,537
$ —

June 30, 2019
Description Total Level 1 Level 2 Level 3
U.S government agencies $ 15,210
$ —
$ 15,210
$ —
Residential MBS of U.S. government agencies and GSE 75,180
—
75,180
—
Municipal bonds 25,312
—
25,312
—
Corporate bonds 6,084
—
6,084
—
Total $ 121,786
$ —
$ 121,786
$ —

~~Financial Assets Recorded at Fair Value on a Nonrecurring Basis~~


	June 30, 2021
	Carrying Value		Fair Value		Level 1		Level 2		Level 3
Assets
Cash and cash equivalents	$	50,990	$	50,990	$	50,990	$	—	$	—
Commercial paper, net	189,596		189,596		189,596		—		—
Certificates of deposit in other banks	40,122		40,122		—		40,122		—
Debt securities available for sale	156,459		156,459		—		156,459		—
Loans held for sale	93,539		94,779		—		—		94,779
Loans, net	2,697,799		2,668,570		—		—		2,668,570
FHLB and FRB stock	13,521		N/A		N/A		N/A		N/A
SBIC investments	10,171		10,171		—		—		10,171
Accrued interest receivable	7,933		7,933		52		542		7,339
Liabilities
Noninterest-bearing and NOW deposits	1,281,372		1,281,372		—		1,281,372		—
Money market accounts	975,001		975,001		—		975,001		—
Savings accounts	226,391		226,391		—		226,391		—
Certificates of deposit	472,777		474,397		—		474,397		—
Borrowings	115,000		115,000		—		115,000		—
Accrued interest payable	52		52		—		52		—

The ~~following table presents~~Company had off-balance sheet financial ~~assets measured~~commitments, which include approximately $921,239 and $931,568 of commitments to originate loans, undisbursed portions of construction loans, unused lines of credit, and standing letters of credit at ~~fair value on a non-recurring basis at the dates indicated:~~

June 30, 2020
Description Total Level 1 Level 2 Level 3
Impaired loans $ 9,168
$ —
$ —
$ 9,168
REO 97
—
—
97
Total $ 9,265
$ —
$ —
$ 9,265

June 30, 2019
Description Total Level 1 Level 2 Level 3
Impaired loans $ 9,071
$ —
$ —
$ 9,071
REO 1,804
—
—
1,804
Total $ 10,875
$ —
$ —
$ 10,875

~~Quantitative information about Level 3 fair value measurements during the period ended~~ June 30, ~~2020 is shown in~~2022 and 2021, respectively (see "Note 16 - Commitments and Contingencies"). Since these commitments are based on current rates, the ~~table below:~~carrying amount approximates the fair value.

Fair Value at June 30, 2020
Valuation
Techniques

Unobservable
Input
Range
Weighted
Average
Nonrecurring measurements:
Impaired loans, net $ 9,168
Discounted appraisals and discounted cash flows Collateral discounts: Discount spread: 0% - 63% 2% - 3% 27%
REO $ 97
Discounted Appraisals Collateral discounts 8% 8%

HOMETRUST BANCSHARES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

~~The stated carrying value and estimated fair value amounts of financial instruments as of June 30, 2020 and June 30, 2019, are summarized below:~~

June 30, 2020

Carrying
Value

Fair
Value
Level 1 Level 2 Level 3
Assets:
Cash and interest-bearing deposits $ 121,622
$ 121,622
$ 121,622
$ —
$ —
Commercial paper 304,967
304,967
304,967
—
—
Certificates of deposit in other banks 55,689
55,689
—
55,689
—
Securities available for sale 127,537
127,537
—
127,537
—
Loans, net 2,741,047
2,692,265
—
—
2,692,265
Loans held for sale 77,177
78,129
—
—
78,129
FHLB stock 23,309
23,309
23,309
—
—
FRB stock 7,368
7,368
7,368
—
—
SBIC investments 8,269
8,269
—
—
8,269
Accrued interest receivable 12,312
12,312
208
744
11,360
Liabilities:
Noninterest-bearing and NOW deposits 1,012,200
1,012,200
—
1,012,200
—
Money market accounts 836,738
836,738
—
836,738
—
Savings accounts 197,676
197,676
—
197,676
—
Certificates of deposit 739,142
745,078
—
745,078
—
Borrowings 475,000
511,529
—
511,529
—
Accrued interest payable 1,087
1,087
—
1,087
—

June 30, 2019

Carrying
Value

Fair
Value
Level 1 Level 2 Level 3
Assets:
Cash and interest-bearing deposits $ 71,043
$ 71,043
$ 71,043
$ —
$ —
Commercial paper 241,446
241,446
241,446
—
—
Certificates of deposit in other banks 52,005
52,005
—
52,005
—
Securities available for sale 121,786
121,786
—
121,786
—
Loans, net 2,683,761
2,604,827
—
—
2,604,827
Loans held for sale 18,175
18,591
—
—
18,591
FHLB stock 31,969
31,969
31,969
—
—
FRB stock 7,335
7,335
7,335
—
—
SBIC investments 6,074
6,074
—
—
6,074
Accrued interest receivable 10,533
10,533
350
750
9,433
Liabilities:
Noninterest-bearing and NOW deposits 746,617
746,617
—
746,617
—
Money market accounts 691,172
691,172
—
691,172
—
Savings accounts 177,278
177,278
—
177,278
—
Certificates of deposit 712,190
712,485
—
712,485
—
Borrowings 680,000
688,418
—
688,418
—
Accrued interest payable 2,252
2,252
—
2,252
—

The Company had off-balance sheet financial commitments, which include approximately $598,136 and $628,572 of commitments to originate loans, undisbursed portions of interim construction loans, and unused lines of credit at June 30, 2020 and June 30, 2019 (see Note 18). Since these commitments are based on current rates, the carrying amount approximates the fair value.

~~Estimated fair values were determined using the following methods and assumptions:~~

~~Cash and interest-bearing deposits~~ ~~– The stated amounts approximate fair values as maturities are less than 90 days.~~

~~HOMETRUST BANCSHARES, INC. AND SUBSIDIARY~~

~~Notes to Consolidated Financial Statements~~

~~(Dollars in thousands, except per share data)~~

~~Commercial paper~~ ~~– The stated amounts approximate fair value due to the short-term nature of these investments.~~

~~Certificates of deposit in other banks~~ ~~– The stated amounts approximate fair values.~~

~~Securities available for sale~~ ~~– Fair values are based on quoted market prices where available. If quoted market prices are not available, fair values are based on quoted market prices of comparable instruments.~~

~~Loans, net~~ – Fair values for loans are estimated by segregating the portfolio by type of loan and discounting scheduled cash flows using current market interest rates for loans with similar terms and credit quality. A prepayment assumption is used as an estimate of the portion of loans that will be repaid prior to their scheduled maturity. A liquidity premium assumption is used as an estimate for the additional return required by an investor of assets that are potentially considered illiquid.

~~Loans held for sale~~ – The fair value of mortgage loans held for sale is determined by outstanding commitments from investors on a "best efforts" basis or current investor yield requirements, calculated on the aggregate loan basis. The fair value of SBA loans and HELOCs held for sale is based on what investors are currently offering for loans with similar characteristics.

~~FHLB and FRB stock~~ – No ready market exists for these stocks and they have no quoted market value. However, redemption of these stocks has historically been at par value. Accordingly, cost is deemed to be a reasonable estimate of fair value.

~~SBIC~~ – No ready market exists for these investments and they have no quoted market value. SBIC investments are valued at cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions of identical or similar investments. Accordingly, cost is deemed to be a reasonable estimate of fair value.

~~Deposits~~– Fair values for demand deposits, money market accounts, and savings accounts are the amounts payable on demand as of June 30, 2020 and June 30, 2019. The fair value of certificates of deposit is estimated by discounting the contractual cash flows using current market interest rates for accounts with similar maturities.

~~Borrowings~~ ~~– The fair value of advances from the FHLB is estimated based on current rates for borrowings with similar terms.~~

~~Accrued interest receivable and payable~~ ~~– The stated amounts of accrued interest receivable and payable approximate the fair value.~~

~~Limitations~~ – Fair value estimates are made at a specific point in time, based on relevant market information and information about the financial instrument. These estimates do not reflect any premium or discount that could result from offering for sale at one time the Company’s entire holdings of a particular financial instrument. Because no market exists for a significant portion of the Company’s financial instruments, fair value estimates are based on judgments regarding future expected loss experience, current economic conditions, risk characteristics of various financial instruments, and other factors. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimates.

Fair value estimates are based on existing on-and-off balance sheet financial instruments without attempting to estimate the value of anticipated future business and the value of assets and liabilities that are not considered financial instruments. For example, a significant asset not considered a financial asset is premises and equipment. In addition, tax ramifications related to the realization of the unrealized gains and losses can have a significant effect on fair value estimates and have not been considered in any of the estimates.


~~22.~~	~~Revenue~~

On July 1, 2018, the Company adopted ASU 2014-09, “Revenue from Contracts with Customers (Topic 606)” and all subsequent ASUs that modified ASC 606. The adoption of the new standard did not have a material impact on the measurement or recognition of revenue. Results for years ended June 30, 2020 and 2019 are presented under Topic 606, while the year ended June 30, 2018 reflects an offset of $660 of interchange costs against interchange income.

Topic 606 does not apply to revenue associated with financial instruments, including revenue from loans and securities. In addition, certain noninterest income streams such as fees associated with mortgage servicing rights, financial guarantees, and certain credit card fees are also not in scope of the guidance. Topic 606 is applicable to noninterest revenue streams such as deposit related fees, interchange fees, merchant income, and various other service fees. However, the recognition of these revenue streams did not change significantly upon adoption of Topic 606. Substantially all of the Company’s revenue is generated from contracts with customers. The Company has made no significant judgments in applying the revenue guidance prescribed in Topic 606 that affect the determination of the amount and timing of revenue streams with customers.

~~HOMETRUST BANCSHARES, INC. AND SUBSIDIARY~~

~~Notes to Consolidated Financial Statements~~

~~(Dollars in thousands, except per share data)~~

~~The table below presents the Company's sources of noninterest income, segregated by in-scope and out-of-scope revenue streams of Topic 606 for the periods indicated:~~

Year Ended June 30,
2020 2019 2018
In-scope of Topic 606:
Service charges on deposit accounts $ 3,772
$ 3,978
$ 3,674
Fees, interchange, and other service charges 6,332
6,377
5,576
Other 470
775
909
Noninterest income (in-scope of Topic 606) 10,574
11,130
10,159
Noninterest income (out-of-scope of Topic 606) 19,758
11,810
8,813
Total noninterest income $ 30,332
$ 22,940
$ 18,972

~~The following is a description of revenue streams accounted for under Topic 606:~~

~~Service charges on deposit accounts~~

Service charges on deposit accounts consist of account analysis fees (i.e., net fees earned on analyzed business and public checking accounts), monthly service fees, nonsufficient fund fees, check orders, and other deposit account related fees. The Company’s performance obligation for account analysis fees and monthly service fees is generally satisfied, and the related revenue recognized, over the period in which the service is provided. Nonsufficient fund fees, check orders and other deposit account related fees are largely transactional based, and therefore, the Company’s performance obligation is satisfied and related revenue recognized, at a point in time. Payment for service charges on deposit accounts is primarily received immediately or in the following month through a direct charge to customers’ accounts.

~~Fees, interchange, and other service charges~~

Fees, interchange, and other service charges are primarily comprised of debit and credit card income, ATM fees, merchant services income, and other service charges. Debit and credit card income is primarily comprised of interchange fees earned whenever the Company’s debit and credit cards are processed through card payment networks such as Visa. ATM fees are primarily generated when a Company cardholder uses a non-Company ATM or a non-Company cardholder uses a Company ATM. Merchant services income mainly represents fees charged to merchants to process their debit and credit card transactions, in addition to account management fees. Other service charges include revenue from processing wire transfers, cashier’s checks, and other services. The Company’s performance obligation for fees, interchange, and other service charges are largely satisfied, and related revenue recognized, when the services are rendered or upon completion. Payment is typically received immediately or in the following month.

~~Other~~

Other noninterest income consists of safety deposit box rental fees and other miscellaneous revenue streams. Safe deposit box rental fees are charged to the customer on an annual basis and recognized upon receipt of payment. The Company determined that since rentals and renewals occur fairly consistently over time, revenue is recognized on a basis consistent with the duration of the performance obligation.

~~HOMETRUST BANCSHARES, INC. AND SUBSIDIARY~~

~~Notes to Consolidated Financial Statements~~

~~(Dollars in thousands, except per share data)~~

~~23.~~ 20. Unaudited Interim Financial Information

The unaudited statements of income for each of the quarters during the fiscal years ended June 30, ~~2020~~2022, 2021 and ~~2019~~2020 are summarized below:


	Three Months Ended
	June 30, 2022		March 31, 2022		December 31, 2021		September 30, 2021
Interest and dividend income	$	30,126	$	28,195	$	28,488	$	29,305
Interest expense	1,267		1,155		1,320		1,598
Net interest income	28,859		27,040		27,168		27,707
Provision (benefit) for credit losses	3,413		(45)		(2,500)		(1,460)
Net interest income after provision (benefit) for credit losses	25,446		27,085		29,668		29,167
Noninterest income	9,716		8,947		10,180		10,352
Noninterest expense	27,459		25,799		25,909		26,016
Income before income taxes	7,703		10,233		13,939		13,503
Income tax expense	1,678		2,210		2,861		2,976
Net income	$	6,025	$	8,023	$	11,078	$	10,527
Net income per common share
Basic	$	0.40	$	0.51	$	0.70	$	0.66
Diluted	$	0.39	$	0.51	$	0.68	$	0.65


	Three Months Ended
	June 30, 2021		March 31, 2021		December 31, 2020		September 30, 2020
Interest and dividend income	$	28,806	$	29,321	$	30,157	$	30,449
Interest expense	2,808		3,628		4,035		4,940
Net interest income	25,998		25,693		26,122		25,509
Provision (benefit) for credit losses	(955)		(4,100)		(3,030)		950
Net interest income after provision (benefit) for credit losses	26,953		29,793		29,152		24,559
Noninterest income	11,160		10,678		9,344		8,639
Noninterest expense	48,233		30,506		26,443		26,000
Income (loss) before income taxes	(10,120)		9,965		12,053		7,198
Income tax expense (benefit)	(2,712)		2,096		2,592		1,445
Net income (loss)	$	(7,408)	$	7,869	$	9,461	$	5,753
Net income (loss) per common share
Basic	$	(0.46)	$	0.49	$	0.58	$	0.35
Diluted	$	(0.46)	$	0.48	$	0.57	$	0.35


	Three Months Ended
	June 30, 2020		March 31, 2020		December 31, 2019		September 30, 2019
Interest and dividend income	$	31,074	$	33,037	$	35,896	$	36,247
Interest expense	6,386		7,728		8,862		9,174
Net interest income	24,688		25,309		27,034		27,073
Provision for credit losses	2,700		5,400		400		—
Net interest income after provision for credit losses	21,988		19,909		26,634		27,073
Noninterest income	7,223		6,375		9,074		7,660
Noninterest expense	24,652		24,903		24,041		23,533
Income before income taxes	4,559		1,381		11,667		11,200
Income tax expense	964		188		2,476		2,396
Net income	$	3,595	$	1,193	$	9,191	$	8,804
Net income per common share
Basic	$	0.22	$	0.07	$	0.54	$	0.51
Diluted	$	0.22	$	0.07	$	0.52	$	0.49

Three months ended
June 30,
2020 March 31, 2020 December 31, 2019 September 30, 2019
Interest and dividend income $ 31,074
$ 33,037
$ 35,896
$ 36,247
Interest expense 6,386
7,728
8,862
9,174
Net interest income 24,688
25,309
27,034
27,073
Provision for loan losses 2,700
5,400
400
—
Net interest income after provision for loan losses 21,988
19,909
26,634
27,073
Noninterest income 7,223
6,375
9,074
7,660
Noninterest expense 24,652
24,903
24,041
23,533
Net income before income taxes 4,559
1,381
11,667
11,200
Income tax expense 964
188
2,476
2,396
Net income $ 3,595
$ 1,193
$ 9,191
$ 8,804
Net income per common share:

Basic $ 0.22
$ 0.07
$ 0.54
$ 0.51
Diluted $ 0.22
$ 0.07
$ 0.52
$ 0.49

Three months ended
June 30,
2019 March 31, 2019 December 31, 2018 September 30, 2018
Interest and dividend income $ 35,820
$ 34,714
$ 34,400
$ 32,280
Interest expense 8,931
8,145
7,299
6,008
Net interest income 26,889
26,569
27,101
26,272
Provision for loan losses 200
5,500
—
—
Net interest income after provision for loan losses 26,689
21,069
27,101
26,272
Noninterest income 6,846
5,396
5,085
5,613
Noninterest expense 23,415
22,978
21,858
21,883
Net income before income taxes 10,120
3,487
10,328
10,002
Income tax expense 2,107
185
2,287
2,212
Net income $ 8,013
$ 3,302
$ 8,041
$ 7,790
Net income per common share:

Basic $ 0.45
$ 0.19
$ 0.45
$ 0.43
Diluted $ 0.44
$ 0.18
$ 0.43
$ 0.41

21. Subsequent Events

On July 24, 2022, the Company entered into an Agreement and Plan of Merger (the "Merger Agreement") with Quantum Capital Corp., a Georgia corporation (“Quantum”). Pursuant to the terms and conditions set forth in the Merger Agreement, Quantum will merge with and into the Company, with the Company surviving, and Quantum National Bank, the wholly owned subsidiary of Quantum, will merge with and into the Bank with the Bank as the surviving bank. The Merger Agreement was unanimously approved by the Boards of both Quantum and HomeTrust and by the Quantum stockholders. The parties anticipate that the Merger will close in the first quarter of calendar year 2023.

Item 9. Changes In and Disagreements With Accountants on Accounting andFinancial Disclosure

None.

Item 9A. Controls and Procedures

Evaluation of Disclosure Controls and ~~Procedures~~Procedures: An evaluation of the Company’s disclosure controls and procedures (as defined in Section 13a-15(e) of the Securities Exchange Act of 1934 (the “Act”)) was carried out under the supervision and with the participation of the Company’s Chief Executive Officer, Chief Financial Officer, and several other members of the Company’s senior management as of the end of the period covered by this report. The Company’s Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures as of June 30, ~~2020~~2022 were effective in ensuring that the information required to be disclosed by the Company in the reports it files or submits under the Act is (i) accumulated and communicated to the Company’s management (including the Chief Executive Officer and Chief Financial Officer) in a timely manner, and (ii) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.

Report of Management on Internal Control over Financial ~~Reporting~~Reporting: The management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting. The internal control process has been designed under our supervision to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the Company’s financial statements for external reporting purposes in accordance with accounting principles generally accepted in the United States of America.

Management conducted an assessment of the effectiveness of the Company’s internal control over financial reporting as of June 30, ~~2020,~~2022, utilizing the framework established in Internal Control – Integrated Framework 2013 issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO"). Based on this assessment, management has determined that the Company’s internal control over financial reporting as of June 30, ~~2020~~2022 was effective.

Our internal control over financial reporting includes policies and procedures that pertain to the maintenance of records that accurately and fairly reflect, in reasonable detail, transactions and dispositions of assets; and provide reasonable assurances that: (1) transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States; (2) receipts and expenditures are being made only in accordance with authorizations of management and the directors of the Company; and (3) unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on the Company’s financial statements are prevented or timely detected.

All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

~~Dixon Hughes Goodman~~FORVIS, LLP, an independent registered public accounting firm, has audited the consolidated financial statements included in this Annual Report and has issued a report on the effectiveness of our internal control over financial reporting, which report is included in Item 8 of this Form 10-K. The audit report expresses an unqualified opinion on the effectiveness of the Company's internal control over financial reporting as of June 30, ~~2020.~~2022.

Changes in Internal ~~Controls~~Controls: There have been no changes in the Company’s internal control over financial reporting during the quarter ended June 30, ~~2020~~2022 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

The Company intends to continually review and evaluate the design and effectiveness of its disclosure controls and procedures and to improve its controls and procedures over time and to correct any deficiencies that it may discover in the future. The goal is to ensure that senior management has timely access to all material financial and non-financial information concerning the Company's business. While the Company believes the present design of its disclosure controls and procedures is effective to achieve its goal, future events affecting its business may cause the Company to modify its disclosure controls and procedures. The Company does not expect that its disclosure controls and procedures and internal control over financial reporting will prevent every error or instance of fraud. A control procedure, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control procedure are met. Because of the inherent limitations in all control procedures, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns in controls or procedures can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any control procedure is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control procedure, misstatements due to error or fraud may occur and not be detected.

Item 9B. Other Information

None.

Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

Not applicable.

PART III

Item 10. Directors, Executive Officers and Corporate Governance

~~Directors and Executive Officers~~The information ~~concerning our directors required~~called for by this ~~item is incorporated herein by reference from~~Item will be contained in our definitive ~~proxy statement~~Proxy Statement for our 2022 Annual Meeting of ~~Shareholders~~Stockholders being held on November 16, 2020, a copy of which will be filed with the Securities and Exchange Commission not later than 120 days after the end of our fiscal year. Information about our executive officers is contained under the caption “Information About Our Executive Officers” in Part I of this Form 10-K,14, 2022, and is incorporated herein by ~~this~~ reference.

~~Delinquent Section 16(a) Reports~~ The information concerning compliance with the reporting requirements of Section 16(a) of the Securities Exchange Act of 1934 by our directors, officers and ten percent shareholders required by this item is incorporated herein by reference from our definitive proxy statement for our Annual Meeting of Shareholders being held on November 16, 2020, a copy of which will be filed with the Securities and Exchange Commission not later than 120 days after the end of our fiscal year.

~~Code of Ethics~~ We have adopted a code of ethics that applies to our principal executive officer, principal financial officer, principal accounting officer, and persons performing similar functions, and to all of our other employees and our directors. A copy of our code of ethics is available on our Internet website address, http://www.htb.com.

~~Nominating Procedures~~ ~~There have been no material changes to the procedures by which shareholders may recommend nominees to our Board of Directors since last disclosed to shareholders.~~

~~Audit Committee and Audit Committee Financial Experts~~ Information required by this item regarding the audit committee of the Company's Board of Directors, including information regarding the audit committee financial expert serving on the audit committee, is incorporated herein by reference from our definitive proxy statement for our Annual Meeting of Shareholders being held on November 16, 2020, a copy of which will be filed with the Securities and Exchange Commission not later than 120 days after the end of our fiscal year.

Item 11. Executive Compensation

The information ~~concerning compensation required~~called for by this ~~item~~Item will be contained in our definitive Proxy Statement for our 2022 Annual Meeting of Stockholders being held on November 14, 2022, and is incorporated herein by reference from our definitive proxy statement for our Annual Meeting of Shareholders being held on November 16, 2020, a copy of which will be filed with the Securities and Exchange Commission not later than 120 days after the end of our fiscal year.reference.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related ~~Shareholder~~Stockholder Matters

The information ~~concerning security ownership of certain beneficial owners and management required~~called for by this ~~item~~Item will be contained in our definitive Proxy Statement for our 2022 Annual Meeting of Stockholders being held on November 14, 2022, and is incorporated herein by reference from our definitive proxy statement for our Annual Meeting of Shareholders being held on November 16, 2020, a copy of which will be filed with the Securities and Exchange Commission not later than 120 days after the end of our fiscal year. Management is not aware of any arrangements, including any pledge by any person of securities of the Company, the operation of which may at a subsequent date result in a change in control of the Company. The information concerning our equity incentive plan required by this item is set forth below.reference.

Plan Category Number of securities to be issued upon exercise of outstanding options, warrants, and rights Weighted-average exercise price of outstanding options, warrants, and rights Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
(a) (b) (c)
Equity compensation plans approved by security holders 1,615,500
$ 18.12
236,344
⁽¹⁾

~~(1) 132,444 securities remain for issuance of restricted stock and 103,900 securities remain for issuance of stock options.~~

Item 13. Certain Relationships and Related Transactions, and Director Independence

The information ~~concerning certain relationships and related transactions and director independence required~~called for by this ~~item~~Item will be contained in our definitive Proxy Statement for our 2022 Annual Meeting of Stockholders being held on November 14, 2022, and is incorporated herein by reference from our definitive proxy statement for our Annual Meeting of Shareholders being held on November 16, 2020, a copy of which will be filed with the Securities and Exchange Commission not later than 120 days after the end of our fiscal year.reference.

Item 14. Principal Accountant Fees and Services

The information ~~concerning principal accountant fees~~called for by this Item will be contained in our definitive Proxy Statement for our 2022 Annual Meeting of Stockholders being held on November 14, 2022, and ~~services~~ is incorporated herein by reference from our definitive proxy statement for our Annual Meeting of Shareholders being held on November 16, 2020, a copy of which will be filed with the Securities and Exchange Commission not later than 120 days after the end of our fiscal year.

reference.

The Independent Registered Public Accounting Firm is FORVIS, LLP (PCAOB Firm ID No. 686) located in Springfield, Missouri.

PART IV

Item 15. Exhibits and Financial Statement Schedules

(a)(1) Financial Statements: See Part ~~II--Item~~II – Item 8. Financial Statements and Supplementary Data.

(a)(2) Financial Statement Schedules: All financial statement schedules have been omitted as the information is not required under the related instructions or is not applicable.

(a)(3) Exhibits: See Exhibit Index.

(b) Exhibits: The following exhibits are filed as part of this Form 10-K and this list constitutes the Exhibit Index.


Regulation S-K Exhibit Number	Document	Reference to Prior Filing or Exhibit Number Attached Hereto

2.1	Agreement and Plan of Merger, dated as of September 20, 2016, by and between HomeTrust Bancshares, Inc. and TriSummit Bancorp, Inc.	(a)
2.2	Purchase and Assumption Agreement, dated as of June 9, 2014, between Bank of America, National Association and HomeTrust Bank	(b)
2.3	Agreement and Plan of Merger, dated as of January 22, 2014, by and between HomeTrust Bancshares, Inc. and Jefferson Bancshares, Inc.	(c)
2.4	Agreement and Plan of Merger, dated as of July 24, 2022, by and between HomeTrust Bancshares, Inc. and Quantum Capital Corp.	(r)
3.1	Charter of HomeTrust Bancshares, Inc.	(d)
3.2	Amended and Restated Bylaws of HomeTrust Bancshares, Inc.	(f)
4.1	Description of HomeTrust Bancshares, Inc. Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934.	4.1
10.1	HomeTrust Bancshares, Inc. Senior Leadership Incentive Plan (formerly known as Operating Committee Incentive Program)	10.1
10.2	Amended and Restated Employment and Transition Agreement between HomeTrust Bancshares, Inc. and Dana L. Stonestreet	10.2
10.3	Amended and Restated Employment Agreement between HomeTrust Bancshares, Inc. and C. Hunter Westbrook	(g)
10.3A	Amendment No. 1 to Amended and Restated Employment Agreement between HomeTrust Bancshares, Inc. and C. Hunter Westbrook	(s)
10.3B	Amendment No. 2 to Amended and Restated Employment Agreement between HomeTrust Bancshares, Inc. and C. Hunter Westbrook	(h)
10.3C	Amendment No. 3 to Amended and Restated Employment Agreement between HomeTrust Bancshares, Inc. and C. Hunter Westbrook	(q)
10.3D	Amendment No. 4 to Amended and Restated Employment Agreement between HomeTrust Bancshares, Inc. and C. Hunter Westbrook	(e)
10.4	Amended and Restated Employment Agreement between HomeTrust Bancshares, Inc. and Tony J. VunCannon	(g)

Regulation S-K Exhibit Number Document Reference to Prior Filing or Exhibit Number Attached Hereto

2.1
Agreement and Plan of Merger, dated as of September 20, 2016, by and between HomeTrust Bancshares, Inc. and TriSummit Bancorp, Inc.
(a)
2.2
Purchase and Assumption Agreement, dated as of June 9, 2014, between Bank of America, National Association and HomeTrust Bank
(b)
2.3
Agreement and Plan of Merger, dated as of January 22, 2014, by and between HomeTrust Bancshares, Inc. and Jefferson Bancshares, Inc.
(c)
3.1
Charter of HomeTrust Bancshares, Inc.
(d)
3.2
Articles Supplementary to the Charter of HomeTrust Bancshares, Inc. for HomeTrust Bancshares, Inc.’s Junior Participating Preferred Stock, Series A
(e)
3.3
Amended and Restated Bylaws of HomeTrust Banchshares, Inc.
(f)
4.1
Tax Benefits Preservation Plan, dated as of September 25, 2012, between HomeTrust Bancshares, Inc. and Computershare Trust Company, N.A., as successor rights agent to Registrar and Transfer Company
(e)
4.2
Amendment No. 1, dated as of August 31, 2015, to Tax Benefits Preservation Plan, dated as of September 25, 2012, between HomeTrust Bancshares, Inc. and Computershare Trust Company, N.A., as successor rights agent to Registrar and Transfer Company
(o)
4.3
Amendment No. 2, dated as of August 21, 2018, to Tax Benefits Preservation Plan, dated as of September 25, 2012, between HomeTrust Bancshares, Inc. and Computershare Trust Company, N.A., as successor rights agent to Registrar and Transfer Company
(t)
4.4
Description of HomeTrust Bancshares, Inc. Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934.
4.4
10.1
HomeTrust Bancshares, Inc. Strategic Operating Committee Incentive Plan
(s)
10.2
Amended and Restated Employment Agreement entered into between HomeTrust Bancshares, Inc. and Dana L. Stonestreet
(g)
10.3
Amended and Restated Employment Agreement entered into between HomeTrust Bancshares, Inc. and C. Hunter Westbrook
(g)
10.3A
Amendment No. 1 to Amended and Restated Employment Agreement entered into between HomeTrust Bancshares, Inc. and C. Hunter Westbrook
(u)
10.4
Amended and Restated Employment Agreement entered into between HomeTrust Bancshares, Inc. and Tony J. VunCannon
(g)
10.5
Employment Agreement between HomeTrust Bancshares, Inc. and Howard L. Sellinger
(g)
10.6
Employment Agreement between HomeTrust Bank and Sidney A. Biesecker
(d)
10.7
HomeTrust Bank Executive Supplemental Retirement Income Master Agreement (“SERP”)
(d)
10.7A
SERP Joinder Agreement for F. Edward Broadwell, Jr.
(d)
10.7B
SERP Joinder Agreement for Dana L. Stonestreet
(d)
10.7C
SERP Joinder Agreement for Tony J. VunCannon
(d)
10.7D
SERP Joinder Agreement for Howard L. Sellinger
(d)
10.7E
SERP Joinder Agreement for Stan Allen
(d)
10.7F
SERP Joinder Agreement for Sidney A. Biesecker
(d)

10.7G
SERP Joinder Agreement for Peggy C. Melville
(d)
10.7H
SERP Joinder Agreement for William T. Flynt
(d)
10.7I
Amended and Restated Supplemental Income Agreement between HomeTrust Bank, as successor to Industrial Federal Savings Bank, and Sidney Biesecker
(i)
10.8
HomeTrust Bank Director Emeritus Plan (“Director Emeritus Plan”)
(d)
10.8A
Director Emeritus Plan Joinder Agreement for William T. Flynt
(d)
10.8B
Director Emeritus Plan Joinder Agreement for J. Steven Goforth
(d)
10.8C
Director Emeritus Plan Joinder Agreement for Craig C. Koontz
(d)
10.8D
Director Emeritus Plan Joinder Agreement for Larry S. McDevitt
(d)
10.8E
Director Emeritus Plan Joinder Agreement for F.K. McFarland, III
(d)
10.8F
Director Emeritus Plan Joinder Agreement for Peggy C. Melville
(d)
10.8G
Director Emeritus Plan Joinder Agreement for Robert E. Shepherd, Sr.
(d)
10.9
HomeTrust Bank Defined Contribution Executive Medical Care Plan
(d)
10.10
HomeTrust Bank 2005 Deferred Compensation Plan
(d)
10.11
HomeTrust Bank Pre-2005 Deferred Compensation Plan
(d)
10.12
HomeTrust Bancshares, Inc. Strategic Operating Committee Incentive Plan
(r)
10.13
HomeTrust Bancshares, Inc. 2013 Omnibus Incentive Plan (“Omnibus Incentive Plan”)
(j)
10.14
Form of Incentive Stock Option Award Agreement under Omnibus Incentive Plan
(k)
10.15
Form of Non-Qualified Stock Option Award Agreement under Omnibus Incentive Plan
(k)
10.16
Form of Stock Appreciation Right Award Agreement under Omnibus Incentive Plan
(k)
10.17
Form of Restricted Stock Award Agreement under Omnibus Incentive Plan
(k)
10.18
Form of Restricted Stock Unit Award Agreement under Omnibus Incentive Plan
(k)
10.19 Reserved
10.20 Reserved
10.21
Money Purchase Deferred Compensation Agreement, dated as of September 1, 1987, between HomeTrust Bank and F. Edward Broadwell, Jr.
(n)
10.22
Retirement Payment Agreement, dated as of September 1, 1987, between HomeTrust Bank and F. Edward Broadwell, Jr., as amended
(n)
10.23
Retirement Payment Agreement, dated as of September 1, 1987, between HomeTrust Bank and Larry S. McDevitt, as amended
(n)
10.24
Retirement Payment Agreement, dated as of September 1, 1987, between HomeTrust Bank and Peggy C. Melville, as amended
(n)
10.25
Retirement Payment Agreement, dated as of August 1, 1988, between HomeTrust Bank and Robert E. Shepherd, Sr., as amended
(n)
10.26
Retirement Payment Agreement, dated as of May 1, 1991, between HomeTrust Bank and William T. Flynt, as amended
(n)
10.27
Offer Letter between HomeTrust Bank and Keith J. Houghton
(p)
10.28
Form of Relocation Repayment Agreement between HomeTrust Bank and Keith J. Houghton
(p)
10.29
Amended and Restated Change in Control Severance Agreement between HomeTrust Bancshares, Inc. and Keith J. Houghton
(g)
10.30
Amended and Restated Change in Control Severance Agreement between HomeTrust Bancshares, Inc. and R. Parrish Little
(v)
10.31
Change in Control Severance Agreement between HomeTrust Bancshares, Inc. and Marty Caywood
(w)
10.32
Change in Control Severance Agreement between HomeTrust Bancshares, Inc. and Paula C. Labian
(x)
21.0
Subsidiaries of the Registrant
21.0
23.0
Consent of Dixon Hughes Goodman LLP
23.0
31.1
Certification of Chief Executive Officer pursuant to Securities Exchange Act Rules 13a-14(a) and 15d-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.1
31.2
Certification of Chief Financial Officer pursuant to Securities Exchange Act Rules 13a-14(a) and 15d-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2
32.0
Certificate of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.0

101 The following materials from HomeTrust Bancshares’ Annual Report on Form 10-K for the year ended June 30, 2020, formatted in Extensible Business Reporting Language (XBRL): (a) Consolidated Balance Sheets; (b) Consolidated Statements of Income; (c) Consolidated Statements of Comprehensive Income; (d) Consolidated Statements of Changes in Stockholders' Equity; (e) Consolidated Statements of Cash Flows; and (f) Notes to Consolidated Financial Statements. 101

~~_________________~~


~~(a)~~10.4A			~~Attached as Appendix A~~ Amendment No. 1 to ~~the proxy statement/prospectus filed by~~Amended and Restated Employment Agreement between HomeTrust Bancshares, ~~on November 2, 2016 pursuant to Rule 424(b) of the Securities Act of 1933.~~

Inc. and Tony VunCannon	10.4A
~~(b)~~10.5		~~Filed~~ HomeTrust Bank Executive Supplemental Retirement Income Master Agreement (“SERP”)	(d)
10.6		Amendment No. 1 to SERP	(m)
10.7		Amendment No. 2 to SERP	(l)
10.7A		SERP Joinder Agreement for F. Edward Broadwell, Jr.	(d)
10.7B		SERP Joinder Agreement for Dana L. Stonestreet	(d)
10.7C		SERP Joinder Agreement for Tony J. VunCannon	(d)
10.7D		SERP Joinder Agreement for Howard L. Sellinger	(d)
10.7E		SERP Joinder Agreement for Stan Allen	(d)
10.7F		SERP Joinder Agreement for Sidney A. Biesecker	(d)
10.7G		SERP Joinder Agreement for Peggy C. Melville	(d)
10.7H		SERP Joinder Agreement for William T. Flynt	(d)
10.7I		Amended and Restated Supplemental Income Agreement between HomeTrust Bank, as ~~an exhibit~~successor to Industrial Federal Savings Bank, and Sidney Biesecker	(i)
10.8		HomeTrust Bank Director Emeritus Plan (“Director Emeritus Plan”)	(d)
10.8A		Director Emeritus Plan Joinder Agreement for William T. Flynt	(d)
10.8B		Director Emeritus Plan Joinder Agreement for J. Steven Goforth	(d)
10.8C		Director Emeritus Plan Joinder Agreement for Craig C. Koontz	(d)
10.8D		Director Emeritus Plan Joinder Agreement for Larry S. McDevitt	(d)
10.8E		Director Emeritus Plan Joinder Agreement for F.K. McFarland, III	(d)
10.8F		Director Emeritus Plan Joinder Agreement for Peggy C. Melville	(d)
10.8G		Director Emeritus Plan Joinder Agreement for Robert E. Shepherd, Sr.	(d)
10.9		HomeTrust Bank Defined Contribution Executive Medical Care Plan	(d)
10.9A		Amendment No. 1 to HomeTrust ~~Bancshares’s Current Report on Form 8-K filed on June 10, 2014 (File No. 001-35593).~~

Bank Defined Contribution Executive Medical Care Plan	(m)
~~(c)~~10.9B		~~Attached as Appendix A~~ Form of Joinder Agreement Under the HomeTrust Bank Defined Contribution Executive Medical Care Plan	(m)
10.10		HomeTrust Bank 2005 Deferred Compensation Plan	(d)
10.10A		Amendment No. 1 to ~~the joint proxy statement/prospectus filed by~~ HomeTrust Bank 2005 Deferred Compensation Plan	(m)
10.11		HomeTrust Bank Pre-2005 Deferred Compensation Plan	(d)
10.11A		Amendment No. 1 to HomeTrust Bank Pre-2005 Deferred Compensation Plan	(m)
10.12		HomeTrust Bancshares, ~~on April 28, 2014 pursuant to Rule 424(b) of the Securities Act of 1933.~~

Inc. 2013 Omnibus Incentive Plan (“Omnibus Incentive Plan”)	(j)
~~(d)~~10.13			~~Filed as an exhibit to HomeTrust Bancshares’s Registration Statement on~~ Form ~~S-1 (File No. 333-178817) filed on December 29, 2011.~~

of Incentive Stock Option Award Agreement under Omnibus Incentive Plan	(k)
~~(e)~~10.14			~~Filed as an exhibit to HomeTrust Bancshares’s Current Report on~~ Form ~~8-K filed on September 25, 2012 (File No. 001-35593).~~

of Non-Qualified Stock Option Award Agreement under Omnibus Incentive Plan	(k)
~~(f)~~10.15			~~Filed as an exhibit to HomeTrust Bancshares’s Current Report on~~ Form ~~8-K filed on May 1, 2018 (File No. 001-35593).~~

of Stock Appreciation Right Award Agreement under Omnibus Incentive Plan	(k)
~~(g)~~10.16			~~Filed as an exhibit to HomeTrust Bancshares’s Current Report on~~ Form ~~8-K filed on September 11, 2018 (File No. 001-35593).~~

of Restricted Stock Award Agreement under Omnibus Incentive Plan	(k)
~~(h)~~10.17			~~Reserved~~

Form of Restricted Stock Unit Award Agreement under Omnibus Incentive Plan	(k)
~~(i)~~10.18		~~Filed~~ Agreement and General Release between HomeTrust Bancshares, Inc. and Paula C. Labian	(o)
10.19		Retirement Payment Agreement, dated as ~~an exhibit to~~ of September 1, 1987, between HomeTrust Bank and Larry S. McDevitt, as amended	(n)
10.20		Change in Control Severance Agreement between HomeTrust Bancshares, Inc. and Marty Caywood	(t)
10.20A		Amendment No. ~~One~~1 to Change in Control Severance Agreement between HomeTrust ~~Bancshares’s Registration Statement on Form S-1 (File No. 333-178817) filed on March 9, 2012.~~

Bancshares, Inc. and Marty Caywood	10.20A
~~(j)~~10.21			~~Attached as Appendix A to~~ Amended and Restated Change in Control Severance Agreement between HomeTrust ~~Bancshares’s definitive proxy statement filed on December 5, 2012 (File No. 001-35593).~~

Bancshares, Inc. and Keith J. Houghton	(g)
~~(k)~~10.21A			~~Filed as an exhibit~~ Amendment No. 1 to Amended and Restated Change in Control Severance Agreement between HomeTrust ~~Bancshares’s Registration Statement on Form S-8 (File No. 333-186666) filed on February 13, 2013.~~

Bancshares, Inc. and Keith J. Houghton	10.21A
~~(l)~~10.22			~~Filed as an exhibit to~~ Amended and Restated Change in Control Severance Agreement between HomeTrust ~~Bancshares’s Current Report on Form 8-K filed on June 3, 2014 (File No. 001-35593).~~Bancshares, Inc. and R. Parrish Little			(p)


~~(m)~~	~~Filed as an exhibit to Jefferson Bancshares's, Inc.’s Quarterly Report on Form 10-Q for the quarter ended December 31, 2008 (File No. 000-50347).~~


~~(n)~~	~~Filed as an exhibit to HomeTrust Bancshares's Annual Report on Form 10-K for the fiscal year ended June 30, 2014 (File No. 001-35593).~~


~~(o)~~	~~Filed as an exhibit to HomeTrust Bancshares’s Current Report on Form 8-K filed on August 31, 2015 (File No. 001-35593).~~


~~(p)~~	~~Filed as an exhibit to HomeTrust Bancshares's Annual Report on Form 10-K for the fiscal year ended June 30, 2015 (File No. 001-35593).~~


~~(q)~~	~~Reserved~~


~~(r)~~	~~Filed as an exhibit to HomeTrust Bancshares's Annual Report on Form 10-K for the fiscal year ended June 30, 2016 (File No. 001-35593).~~


~~(s)~~	~~Filed as an exhibit to HomeTrust Bancshares's Quarterly Report on Form 10-Q for the quarter ended September 30, 2019 (File No. 001-35593).~~


~~(t)~~	~~Filed as an exhibit to HomeTrust Bancshares’s Current Report on Form 8-K filed on August 21, 2018 (File No. 001-35593).~~


~~(u)~~	~~Filed as an exhibit to HomeTrust Bancshares’s Current Report on Form 8-K filed on September 25, 2018 (File No. 001-35593.~~


~~(v)~~	~~Filed as an exhibit to HomeTrust Bancshares's Annual Report on Form 10-K for the fiscal year ended June 30, 2018 (File No. 001-35593).~~


~~(w)~~	~~Filed as an exhibit to HomeTrust Bancshares's Quarterly Report on Form 10-Q for the quarter ended March 31, 2019 (File No. 001-35593).~~


~~(x)~~	~~Filed as an exhibit to HomeTrust Bancshares's Quarterly Report on Form 10-Q for the quarter ended December 31, 2018 (File No. 001-35593.~~


10.22A	Amendment No. 1 to Amended and Restated Change in Control Severance Agreement between HomeTrust Bancshares, Inc. and R. Parrish Little	10.22A
10.23	Amendment No. 1 to Change in Control Severance Agreement between HomeTrust Bancshares, Inc. and Mark DeMarcus	10.23
10.24	Amendment No. 1 to Change in Control Severance Agreement between HomeTrust Bancshares, Inc. and Kristin Powell	10.24
10.25	Change in Control Severance Agreement between HomeTrust Bancshares, Inc. and Megan Pelletier	10.25
21.0	Subsidiaries of the Registrant	21.0
23.0	Consent of FORVIS, LLP	23.0
31.1	Certification of Chief Executive Officer pursuant to Securities Exchange Act Rules 13a-14(a) and 15d-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	31.1
31.2	Certification of Chief Financial Officer pursuant to Securities Exchange Act Rules 13a-14(a) and 15d-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	31.2
32.0	Certificate of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	32.0
101	The following materials from HomeTrust Bancshares’ Annual Report on Form 10-K for the year ended June 30, 2022, formatted in Extensible Business Reporting Language (XBRL): (a) Consolidated Balance Sheets; (b) Consolidated Statements of Income; (c) Consolidated Statements of Comprehensive Income; (d) Consolidated Statements of Changes in Stockholders' Equity; (e) Consolidated Statements of Cash Flows; and (f) Notes to Consolidated Financial Statements.	101

(a)Attached as Appendix A to the proxy statement/prospectus filed by HomeTrust Bancshares on November 2, 2016 pursuant to Rule 424(b) of the Securities Act of 1933.

(b)Filed as an exhibit to HomeTrust Bancshares’s Current Report on Form 8-K filed on June 10, 2014 (File No. 001-35593).

(c)Attached as Appendix A to the joint proxy statement/prospectus filed by HomeTrust Bancshares on April 28, 2014 pursuant to Rule 424(b) of the Securities Act of 1933.

(d)Filed as an exhibit to HomeTrust Bancshares’s Registration Statement on Form S-1 (File No. 333-178817) filed on December 29, 2011.

(e)Filed as an exhibit to HomeTrust Bancshares's Current Report on Form 8-K filed on May 24, 2022 (File No. 001-35593).

(f)Filed as an exhibit to HomeTrust Bancshares's Quarterly Report on Form 10-Q for the quarter ended March 31, 2021 (File No. 001-35593).

(g)Filed as an exhibit to HomeTrust Bancshares’s Current Report on Form 8-K filed on September 11, 2018 (File No. 001-35593).

(h)Filed as an exhibit to HomeTrust Bancshares's Current Report on Form 8-K filed on October 28, 2020 (File No. 001-35593).

(i)Filed as an exhibit to Amendment No. 1 to HomeTrust Bancshares’s Registration Statement on Form S-1 (File No. 333-178817) filed on March 9, 2012.

(j)Attached as Appendix A to HomeTrust Bancshares’s definitive proxy statement filed on December 5, 2012 (File No. 001-35593).

(k)Filed as an exhibit to HomeTrust Bancshares’s Registration Statement on Form S-8 (File No. 333-186666) filed on February 13, 2013.

(l)Filed as an exhibit to HomeTrust Bancshares's Current Report on Form 8-K filed on February 15, 2022 (File No. 001-35593).

(m)Filed as an exhibit to HomeTrust Bancshares's Quarterly Report on Form 10-Q for the quarter ended March 31, 2022 (File No. 001-35593).

(n)Filed as an exhibit to HomeTrust Bancshares's Annual Report on Form 10-K for the fiscal year ended June 30, 2014 (File No. 001-35593).

(o)Filed as an exhibit to HomeTrust Bancshares's Quarterly Report on Form 10-Q for the quarter ended March 31, 2021 (File No. 001-35593).

(p)Filed as an exhibit to HomeTrust Bancshares's Annual Report on Form 10-K for the fiscal year ended June 30, 2018 (File No. 001-35593).

(q)Filed as an exhibit to HomeTrust Bancshares's Current Report on Form 8-K filed on July 28, 2021 (File No. 001-35593).

(r)Filed as an exhibit to HomeTrust Bancshares's Current Report on Form 8-K filed on July 25, 2022 (File No. 001-35593).

(s)Filed as an exhibit to HomeTrust Bancshares’s Current Report on Form 8-K filed on September 25, 2018 (File No. 001-35593).

(t)Filed as an exhibit to HomeTrust Bancshares's Quarterly Report on Form 10-Q for the quarter ended March 31, 2019 (File No. 001-35593).

Item 16. Form 10-K Summary

None.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


		HOMETRUST BANCSHARES, INC.

Date: September 12, 2022		~~HOMETRUST BANCSHARES, INC.~~By:	/s/ C. Hunter Westbrook
			C. Hunter Westbrook
~~Date: September 11, 2020~~		~~By:~~	~~/s/ Dana L. Stonestreet~~
	~~Dana L. Stonestreet~~
	~~Chairman of the Board,~~
	President and Chief Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

Signature

Title

Date

/s/ C. Hunter Westbrook

President, Chief Executive Officer and Director

September 12, 2022

C. Hunter Westbrook

(Principal Executive Officer)

~~Signature~~

~~Title~~

~~Date~~

~~/s/ Dana L. Stonestreet~~

~~Chairman of the Board, President and Chief Executive Officer~~

~~September 11, 2020~~

~~Dana L. Stonestreet~~

~~(Principal Executive Officer)~~

/s/ Tony J. VunCannon

Executive Vice President, Chief Financial Officer, Corporate Secretary and Treasurer

September ~~11, 2020~~12, 2022

Tony J. VunCannon

(Principal Financial and Accounting Officer)

/s/ Dana L. Stonestreet

Chairman of the Board

September 12, 2022

Dana L. Stonestreet

/s/ Sidney A. Biesecker

Director

September ~~11, 2020~~12, 2022

Sidney A. Biesecker

~~/s/ J. Steven Goforth~~

~~Director~~

~~September 11, 2020~~

~~J. Steven Goforth~~

/s/ Robert E. James

Director

September ~~11, 2020~~12, 2022

Robert E. James

/s/ Laura C. Kendall

Director

September ~~11, 2020~~12, 2022

Laura C. Kendall

/s/ Craig C. Koontz

Director

September ~~11, 2020~~12, 2022

Craig C. Koontz

/s/ Rebekah Lowe

Director

September ~~11, 2020~~12, 2022

Rebekah Lowe

/s/ F.K. McFarland, III

Director

September ~~11, 2020~~12, 2022

F.K. McFarland, III

/s/ John A. Switzer

Director

September ~~11, 2020~~12, 2022

John A. Switzer

/s/ Richard T. Williams

Director

September ~~11, 2020~~12, 2022

Richard T. Williams

~~125~~94



Maryland						45-5055422
(State or ~~Other Jurisdiction~~other jurisdiction of ~~Incorporation~~incorporation or ~~Organization)~~organization)						(I.R.S. Employer Identification No.)

10 Woodfin Street, Asheville, North Carolina						28801
(Address of ~~Principal Executive Offices)~~principal executive offices)						(Zip Code)



Title of Each Class	Trading Symbol	Name of Each Exchange on Which Registered
Common Stock, par value $0.01 per share	HTBI	The NASDAQ Stock Market LLC



Large Accelerated Filer ~~[ ]~~☐						Accelerated Filer ~~[X]~~☒
Non-Accelerated Filer ~~[ ]~~☐						Smaller reporting company ~~[ ]~~☐
Emerging growth company ~~[ ]~~☐


				Page
					~~Page~~PART I
~~PART I~~
Item 1	Business		65
Item 1A.		Risk Factors		3713
Item 1B.		Unresolved Staff Comments		4824
Item 2		Properties		4924
Item 3		Legal Proceedings		4924
Item 4		Mine Safety Disclosures		4924

PART II
Item 5		Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities		4925
Item 6		Selected Financial Data		5126
Item 7		Management’s Discussion and Analysis of Financial Condition and Results of Operations		5226
Item 7A.		Quantitative and Qualitative Disclosures About Market Risk		6743
Item 8		Financial Statements and Supplementary Data		6843
Item 9		Changes in and Disagreements with Accountants on Accounting and Financial Disclosure		~~119~~90
Item 9A.		~~Control~~Controls and Procedures		~~119~~90
Item 9B.		Other Information		~~119~~90
Item 9C.		Disclosure Regarding Foreign Jurisdictions that Prevent Inspections		90
~~PART III~~
PART III
Item 10		Directors, Executive Officers and Corporate Governance		~~120~~90
Item 11		Executive Compensation		~~120~~91
Item 12		Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters		~~120~~91
Item 13		Certain Relationships and Related Transactions, and Director Independence		~~120~~91
Item 14		Principal Accountant Fees and Services		~~120~~91

PART IV
Item 15		Exhibits and Financial Statement Schedules		~~121~~91
Item 16		Form 10-K Summary		~~124~~94
		Signatures		~~124~~94


Term			Definition
ACL			Allowance for Credit Losses
AFS			Available-For-Sale
ALL			Allowance for Loan Losses
AMLA			Anti-Money Laundering Act of 2020
ARRC			Alternative Reference Rates Committee
ASC			Accounting Standards Codification
ASU			Accounting Standards Update

~~Term~~BHCA			~~Definition~~
~~AFS~~	~~Available-For-Sale~~
~~AICPA~~	~~American Institute of Certified Public Accountants~~
~~AMT~~	~~Alternative Minimum Tax~~
~~ASC~~	~~Accounting Standard Codification~~
~~ASU~~	~~Accounting Standard Update~~
~~BHCA~~	Bank Holding Company Act
BOLI			Bank Owned Life Insurance
BSA			Bank Secrecy Act of 1970
CARES Act			Coronavirus Aid, Relief, and Economic Security Act of 2020
CDCBLR			~~Certificates~~Community Bank Leverage Ratio
CD			Certificate of Deposit
CECL			Current Expected Credit ~~Loss~~Losses
CET1			Common Equity Tier 1
CFPB			Consumer Financial Protection Bureau
~~CBLR~~COVID-19			~~Community Bank Leverage Ratio~~Coronavirus Disease 2019
CRA			Community Reinvestment Act
~~COVID-19~~DCF			~~Coronavirus Disease 2019~~Discounted Cash Flows
~~CPI~~		~~Consumer Price Index~~
~~DTA~~	~~Deferred Tax Asset~~
Dodd-Frank Act		Dodd-Frank Wall Street Reform and Consumer Protection Act
~~EPS~~ECL			Expected Credit Losses
EPS			Earnings Per Share
ESOP			Employee Stock Ownership Plan
Exchange Act			Securities Exchange Act of 1934, as amended
FASB			Financial Accounting Standards Board
FDIC			Federal Deposit Insurance Corporation
Federal Reserve			Board of Governors of the Federal Reserve System
FHFA			Federal Housing Finance Agency
FHLB or FHLB of Atlanta			Federal Home Loan Bank
FRB			Federal Reserve Bank of Richmond
~~GAAP~~GSE			Government-Sponsored Enterprises
HELOC			Home Equity Line of Credit
IRC			Internal Revenue Code
KSOP			HomeTrust Bank KSOP Plan
LIBOR			London Interbank Offered Rate
LPO			Loan Production Office
MBS			Mortgage-Backed Security
MSA			Metropolitan Statistical Area
NBV			Net Book Value
NCCOB			North Carolina Office of the Commissioner of Banks
NOL			Net Operating Loss
PCD			Purchased Financial Assets with Credit Deterioration
PCI			Purchased Credit Impaired
PPP			Paycheck Protection Program



~~[X]~~☒			ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIESEXCHANGE ACT OF 1934



~~[ ]~~☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.			~~[ ]~~☐


Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.			☒


PVE			Present Value of Equity
REO			Real Estate Owned
ROU			Right of Use
SBA			U.S. Small Business Administration
SBIC			Small Business Investment Companies
SEC			Securities and Exchange Commission
SOFR			Secured Overnight Financing Rate
SOX Act			Sarbanes-Oxley Act of 2002
TDR			Troubled Debt Restructuring
USDA B&I			United States Department of Agriculture Business & Industry
US GAAP			Generally Accepted Accounting Principles in the United States
~~GSE~~		~~Government-Sponsored Enterprises~~
~~HELOC~~	~~Home Equity Line of Credit~~
~~IRC~~	~~Internal Revenue Code~~
~~KSOP~~	~~HomeTrust Bank KSOP Plan~~
~~LIBOR~~	~~London Interbank Offered Rate~~
~~LPO~~	~~Loan Production Office~~
~~MBS~~	~~Mortgage-Backed Security~~
~~MSA~~	~~Metropolitan Statistical Area~~
~~NOL~~	~~Net Operating Loss~~
~~NCCOB~~	~~North Carolina Office of the Commissioner of Banks~~
~~OTTI~~	~~Other Than Temporary Impairment~~
~~PCI~~	~~Purchase Credit Impaired~~
~~PPP~~	~~Paycheck Protection Program~~


WNCSC
~~PVE~~		~~Present Value of Equity~~
~~REO~~		~~Real Estate Owned~~
~~ROA~~		~~Return on Assets~~
~~ROE~~		~~Return on Equity~~
~~ROU~~		~~Right of Use~~
~~SAS~~		~~Statement of Auditing Standards~~
~~SBA~~		~~U.S. Small Business Administration~~
~~SBIC~~		~~Small Business Investment Companies~~
~~SEC~~		~~Securities and Exchange Commission~~
~~SOX Act~~		~~Sarbanes-Oxley Act of 2002~~
~~Tax Act~~		~~Tax Cuts and Jobs Act~~
~~TDR~~		~~Troubled Debt Restructuring~~
~~USDA B&I~~		~~United States Department of Agriculture Business & Industry~~
~~WNCSC~~		Western North Carolina Service Corporation



	As of June 30,
Location	2020	2019
U.S. National	11.2%	3.8%
North Carolina	7.6%	4.2%
Asheville MSA	8.9%	3.6%
Charlotte/Concord/Gastonia	8.4%	4.1%
Raleigh	7.2%	4.0%
South Carolina	8.7%	3.4%
Greenville	9.7%	3.3%
Tennessee	9.7%	3.5%
Morristown	9.4%	4.5%
Johnson City	8.9%	4.4%
Kingsport-Bristol	9.2%	4.2%
Knoxville	8.2%	3.9%
Virginia	8.4%	2.9%
Roanoke	8.2%	3.0%



~~Location~~	~~Rank~~⁽¹⁾	~~Deposit Market Share~~⁽¹⁾
~~North Carolina~~	~~18th~~	~~0.40%~~
~~Asheville MSA~~	~~5th~~	~~10.15%~~
~~Charlotte/Gastonia~~	~~17th~~	~~0.03%~~
~~Raleigh~~	~~19th~~	~~0.20%~~
~~South Carolina~~	~~61st~~	~~0.07%~~
~~Greenville~~	~~17th~~	~~0.72%~~
~~Tennessee~~	~~48th~~	~~0.30%~~
~~Morristown~~	~~3rd~~	~~18.88%~~
~~Johnson City~~	~~4th~~	~~8.42%~~
~~Kingsport-Bristol~~	~~6th~~	~~4.31%~~
~~Knoxville~~	~~16th~~	~~0.47%~~
~~Virginia~~	~~61st~~	~~0.10%~~
~~Roanoke~~	~~9th~~	~~5.67%~~
~~Bristol~~	~~5th~~	~~3.39%~~



	At June 30,
	2020					2019					2018						2017					2016
	Amount			Percent		Amount			Percent		Amount			Percent			Amount			Percent		Amount			Percent
	(Dollars in thousands)
Retail consumer loans:
One-to-four family	$	473,693		17.11	%	$	660,591		24.42	%	$	664,289		26.29	%		$	684,089		29.08	%	$	623,701		34.04	%
Home equity - originated	137,447			4.96		139,435			5.16		137,564			5.44			157,068			6.68		163,293			8.91
Home equity - purchased	71,781			2.59		116,972			4.32		166,276			6.58			162,407			6.90		144,377			7.88
Construction and land/lots	81,859			2.96		80,602			2.98		65,601			2.60			50,136			2.13		38,102			2.08
Indirect auto finance	132,303			4.78		153,448			5.67		173,095			6.85			140,879			5.99		108,478			5.92
Consumer	10,259			0.37		11,416			0.42		12,379			0.49			7,900			0.34		4,635			0.25
Total retail consumer loans	907,342			32.77	%	1,162,464			42.97	%	1,219,204			48.25	%		1,202,479			51.12	%	1,082,586			59.08	%
Commercial loans:
Commercial real estate	1,052,906			38.03	%	927,261			34.28	%	857,315			33.93	%		730,408			31.04	%	486,561			26.55	%
Construction and development	215,934			7.80		210,916			7.80		192,102			7.60			197,966			8.42		86,840			4.74
Commercial and industrial	154,825			5.59		160,471			5.93		135,336			5.36		��	120,387			5.12		73,289			4.00
Equipment finance ⁽¹⁾	229,239			8.28		132,058			4.88		13,487			0.54			—			—		—			—
Municipal leases	127,987			4.62		112,016			4.14		109,172			4.32			101,175			4.30		103,183			5.63
Paycheck Protection Program	80,697			2.91		—			—		—			—			—			—		—			—
Total commercial loans	1,861,588			67.23	%	1,542,722			57.03	%	1,307,412			51.75	%		1,149,936			48.88	%	749,873			40.92	%
Total loans	2,768,930			100.00	%	2,705,186			100.00	%	2,526,616			100.00	%		2,352,415			100.00	%	1,832,459			100.00	%
Less:
Deferred costs (fees), net	189					4					(764		)				(945		)			372
Allowance for losses	(28,072		)			(21,429		)			(21,060		)				(21,151		)			(21,292		)
Total loans receivable, net	$	2,741,047				$	2,683,761				$	2,504,792					$	2,330,319				$	1,811,539



	Retail Consumer
	Due During Years Ending June 30,
	2021			2022		2023		2024 to 2025		2026 to 2027		2028 to 2032		2033 and following		Total
	(Dollars in thousands)
One-to-four family
Amount	$	14,037		12,574		11,828		31,497		15,401		54,834		333,522		$	473,693
Weighted Average Rate	4.41		%	4.35	%	4.52	%	4.78	%	4.42	%	4.07	%	4.12	%	4.19		%
Home equity - originated
Amount	$	3,604		5,857		7,803		10,418		5,354		7,779		96,632		$	137,447
Weighted Average Rate	5.22		%	4.79	%	3.93	%	3.87	%	4.35	%	4.00	%	4.07	%	4.11		%
Home equity - purchased
Amount	$	—		—		—		—		—		—		71,781		$	71,781
Weighted Average Rate	—		%	—	%	—	%	—	%	—	%	—	%	2.96	%	2.96		%
Construction and land/lots
Amount	$	263		91		237		866		2,049		2,831		75,522		$	81,859
Weighted Average Rate	7.09		%	6.49	%	8.23	%	5.94	%	5.51	%	5.87	%	3.76	%	3.92		%
Indirect auto finance
Amount	$	1,178		7,397		17,059		66,084		40,409		176		—		$	132,303
Weighted Average Rate	3.18		%	3.23	%	3.53	%	4.53	%	4.86	%	5.56	%	—	%	4.42		%
Consumer
Amount	$	118		382		622		7,882		728		26		501		$	10,259
Weighted Average Rate	5.84		%	4.51	%	5.60	%	5.79	%	6.17	%	3.54	%	16.38	%	6.27		%



	2020				2019				2018
	Amount		Percent of Total		Amount		Percent of Total		Amount		Percent of Total
(Dollars in thousands)
Transaction and Savings Deposits:
Interest-bearing accounts	$	582,299	20.90	%	$	452,295	19.43	%	$	471,364	21.46	%
Noninterest-bearing accounts	429,901		15.43		294,322		12.65		317,822		14.47
Savings accounts	197,676		7.10		177,278		7.62		213,250		9.71
Money market accounts	836,738		30.04		691,172		29.70		677,665		30.86
Total non-certificates	$	2,046,614	73.47	%	$	1,615,067	69.40	%	$	1,680,101	76.50	%
Certificates:
0.00-0.99%	$	285,916	10.26	%	$	134,813	5.79	%	$	273,087	12.43	%
1.00-1.99%	229,972		8.26		122,803		5.28		197,875		9.01
2.00-2.99%	215,518		7.74		441,911		18.99		35,707		1.63
3.00-3.99%	3,388		0.12		8,246		0.35		5,066		0.23
4.00-4.99%	4,346		0.16		4,415		0.19		4,415		0.20
5.00% and over	2		—		2		—		2		—
Total certificates	$	739,142	26.53	%	$	712,190	30.60	%	$	516,152	23.50	%
Total deposits	$	2,785,756	100.00	%	$	2,327,257	100.00	%	$	2,196,253	100.00	%



	Maturity
	3 Months or Less		Over 3 to 6 Months		Over 6 to 12 Months		Over 12 Months		Total
	(In thousands)
CDs less than $100,000	$	73,508	$	77,532	$	56,934	$	66,064	$	274,038
CDs of $100,000 or more	139,142		160,591		50,885		72,249		422,867
Public funds⁽¹⁾	19,529		8,971		11,685		2,052		42,237
Total certificates of deposit	$	232,179	$	247,094	$	119,504	$	140,365	$	739,142



	Total
	Amount		Weighted Average Rate
	(Dollars in thousands)
Due During Years Ending June 30,
2021	$	257,638	3.86	%
2022	303,755		2.94
2023	273,088		4.12
2024 to 2025	662,656		4.37
2026 to 2027	259,930		4.18
2028 to 2032	332,664		3.51
2033 and following	679,199		3.98
Total	$	2,768,930	3.93	%


~~(1)~~	~~The weighted average rate of municipal loans is adjusted for a 24% combined federal and state tax rate since the interest income from these leases is tax exempt.~~



	Years Ended June 30,
	2020		2019		2018
Originations:⁽¹⁾
Retail consumer:	(In thousands)
One-to-four family	$	279,469	$	182,483	$	189,562
Home equity - originated	193,520		70,532		57,018
Construction and land/lots	99,767		106,933		100,421
Indirect auto finance	50,380		55,610		99,558
Consumer	1,432		9,096		3,100
Commercial loans:
Commercial real estate	230,456		186,907		257,494
Construction and development	172,618		173,904		234,102
Commercial and industrial	80,928		78,089		57,643
Paycheck Protection Program	80,732		—		—
Equipment finance	164,018		147,225		20,228
Municipal leases	27,458		22,748		21,038
Total loans originated	$	1,380,778	$	1,033,527	$	1,040,164
Purchases:
Retail consumer:
Home equity - purchased	$	—	$	—	$	60,371
Commercial loans:
Commercial real estate	702		1,005		790
Total loans purchased or acquired	$	702	$	1,005	$	61,161
Sales and repayments:
Retail consumer:
One-to-four family	$	358,852	$	121,158	$	125,830
Home equity - originated	61,959		—		—
Commercial loans:
Commercial real estate	15,824		28,759		—
Construction and development	—		—		116
Commercial and industrial	22,256		18,124		13,244
Total sales	458,891		168,041		139,190
Principal repayments	799,658		674,851		787,487
Total reductions	$	1,258,549	$	842,892	$	926,677
Net increase	$	122,931	$	191,640	$	174,648


~~(1)~~	~~Originations include one-to-four family loans, HELOCs, SBA 7(a) loans, and USDA B&I loans originated for sale of $399.1million, $190.9 million, and $143.8 million for years ended June 30, 2020, 2019, and 2018, respectively.~~



	Loans Delinquent For:
											Total Loans Delinquent
	30-89 Days					90 Days and Over					30 Days or More
	Number	Amount		Percent of Loan Category		Number	Amount		Percent of Loan Category		Number	Amount		Percent of Loan Category
	(Dollars in thousands)
Retail consumer loans:
One-to-four family	28	$	1,679	0.35	%	42	$	3,147	0.66	%	70	$	4,826	1.02	%
Home equity - originated	8	442		0.32		7	310		0.23		15	752		0.55
Home equity - purchased	2	214		—		1	47		—		3	261		—
Construction and land/lots	—	—		—		3	252		0.31		3	252		0.31
Indirect auto finance	47	756		0.57		53	285		0.22		100	1,041		0.79
Consumer	12	30		0.29		10	25		0.24		22	55		0.54
Commercial loans:
Commercial real estate	4	4,528		0.43		10	2,892		0.26		14	7,420		0.70
Construction and development	3	293		0.14		9	341		0.16		12	634		0.29
Commercial and industrial	—	—		—		32	91		0.06		32	91		0.06
Equipment finance	2	303		0.13		10	498		0.22		12	801		0.35
Total	106	$	8,245	0.31	%	177	$	7,888	0.29	%	283	$	16,133	0.60	%


~~(1)~~	PCI loans totaling $965 at June 30, 2020, $1,344 at June 30, 2019, $3,353 at June 30, 2018, $6,664 at June 30, 2017, and $6,607 at June 30, 2016 are excluded from nonaccruing loans due to the accretion of discounts established in accordance with the acquisition method of accounting for business combinations.



Amount		Percent of Total Nonaccruing Loans		Collateral Securing the Indebtedness	Geographic Location
$	4,407	27.7	%	1^st lien on mixed use multifamily and retail commercial building	Campbell County, VA
1,572		9.9		1^st lien on medical office building	Knox County, TN
1,156		7.2		1^st lien on 30 acres with single family home and other improvements	Jefferson County, TN
$	7,135	44.8	%


~~(1)~~	Excluding loans acquired, which have been recorded at fair value with an appropriate credit discount, and PPP loans, the allowance for loan losses was 1.11%, 0.85%, 0.91%, 1.03%, and 1.32% of total loans at June 30, 2020, 2019, 2018, 2017, and 2016, respectively.



	June 30, 2020
	1 year or less			Over 1 year to 5 years			Over 5 to 10 years			Over 10 years			Total
Securities available for sale:	(Dollars in thousands)
U.S. government agencies:
Amortized cost	$	—		$	3,957		$	—		$	—		$	3,957
Fair value	—			4,173			—			—			4,173
Weighted average yield	—		%	2.51		%	—		%	—		%	2.51		%
Residential MBS of U.S. government agencies and GSEs
Amortized cost	39			4,196			20,372			22,022			46,629
Fair value	40			4,273			21,378			22,664			48,355
Weighted average yield	1.58		%	1.80		%	2.26		%	2.21		%	2.19		%
Municipal bonds
Amortized cost	4,546			7,326			2,434			1,784			16,090
Fair value	4,568			7,644			2,630			1,789			16,631
Weighted average yield	2.88		%	3.21		%	3.56		%	2.87		%	3.13		%
Corporate bonds
Amortized cost	24,644			33,598			—			—			58,242
Fair value	24,680			33,698			—			—			58,378
Weighted average yield	1.13		%	2.10		%	—		%	—		%	1.69		%
Total securities
Amortized cost	$	29,229		$	49,077		$	22,806		$	23,806		$	124,918
Fair value	$	29,288		$	49,788		$	24,008		$	24,453		$	127,537
Weighted average yield	1.40		%	2.28		%	2.40		%	2.26		%	2.09		%



	0.00- 0.99%			1.00- 1.99%			2.00- 2.99%				3.00- 3.99%			4.00- 4.99%			5.00% or greater			Total			Percent of Total
	(In thousands)
Quarter ending:
September 30, 2020	$	38,032		$	144,650		$	49,495			$	—		$	—		$	2		$	232,179		31.4	%
December 31, 2020	163,248			38,607			45,220			—	19			—			—			247,094			33.4
March 31, 2021	28,379			25,942			17,639				—			—			—			71,960			9.7
June 30, 2021	14,850			8,182			24,512				—			—			—			47,544			6.4
September 30, 2021	18,188			1,852			22,192				—			2,018			—			44,250			6.0
December 31, 2021	6,021			690			24,702				356			—			—			31,769			4.3
March 31, 2022	2,554			416			8,585				30			—			—			11,585			1.6
June 30, 2022	3,960			312			5,631				—			—			—			9,903			1.3
September 30, 2022	2,308			910			6,614				—			2,328			—			12,160			1.6
December 31, 2022	2,244			2,067			1,459				—			—			—			5,770			0.8
March 31, 2023	2,280			1,076			451				—			—			—			3,807			0.5
June 30, 2023	2,468			820			1,777				31			—			—			5,096			0.7
Thereafter	1,384			4,448			7,241				2,952			—			—			16,025			2.2
Total	$	285,916		$	229,972		$	215,518			$	3,388		$	4,346		$	2		$	739,142		100.0	%
Percent of total	38.7		%	31.1		%	29.1		%		0.5		%	0.6		%	—		%	100.0		%


~~(1)~~	~~Deposits from government and other public entities.~~



~~Name~~	~~Age~~⁽¹⁾	~~Position~~
~~Dana L. Stonestreet~~	66	~~Chairman, President and Chief Executive Officer~~
~~C. Hunter Westbrook~~	57	~~Senior Executive Vice President and Chief Operating Officer~~
~~Tony J. VunCannon~~	55	~~Executive Vice President, Chief Financial Officer, Corporate Secretary, and Treasurer~~
~~Marty Caywood~~	48	~~Executive Vice President and Chief Information Officer~~
~~Keith Houghton~~	58	~~Executive Vice President and Chief Credit Officer~~
~~Paula C. Labian~~	62	~~Executive Vice President and Chief Human Resources Officer~~
~~Parrish Little~~	52	~~Executive Vice President and Chief Risk Officer~~



Period	Total Number Of Shares Purchased	Average Price Paid per Share		Total Number Of Shares Purchased as Part of Publicly Announced Plans	Maximum Number of Shares that May Yet Be Purchased Under Publicly Announced Plans
April 1 - April 30, 2020	81,873	$	15.41	81,873	889,123
May 1 - May 31, 2020	—	—		—	889,123
June 1 - June 30, 2020	—	—		—	889,123
Total	81,873	$	15.41	81,873	889,123



	Year Ended June 30,
	2015	2016	2017	2018	2019	2020
HomeTrust Bancshares, Inc.	100.00	110.38	145.58	167.96	150.00	95.47
NASDAQ Bank Index	100.00	94.84	130.28	143.37	121.67	92.47
NASDAQ Composite	100.00	97.11	123.13	150.60	160.55	201.71



	At or For the Years Ended June 30,
	2020			2019			2018		2017		2016
Selected Financial Ratios and Other Data:
Performance ratios:
Return on assets (ratio of net income to average total assets)	0.63		%	0.80		%	0.25	%	0.40	%	0.42	%
Return on equity (ratio of net income to average equity)	5.54			6.62			2.05		3.14		3.16
Tax equivalent yield on earning assets⁽²⁾	4.13			4.39			4.00		3.79		3.62
Rate paid on interest-bearing liabilities	1.18			1.16			0.65		0.37		0.29
Tax equivalent average interest rate spread⁽²⁾	2.95			3.23			3.35		3.42		3.33
Tax equivalent net interest margin⁽²⁾⁽³⁾	3.17			3.43			3.46		3.49		3.37
Noninterest expense to average total assets	2.70			2.65			2.63		3.04		2.88
Average interest-earning assets to average interest-bearing liabilities	122.10			120.39			120.77		120.26		119.25
Efficiency ratio	72.25			69.46			70.93		84.12		82.96
Efficiency ratio - adjusted⁽⁴⁾	71.62			68.83			70.12		75.48		80.43
Asset quality ratios:
Nonperforming assets to total assets⁽⁵⁾	0.44		%	0.38		%	0.44	%	0.62	%	0.90	%
Nonaccruing loans to total loans⁽⁵⁾	0.58			0.38			0.43		0.58		1.01
Total classified assets to total assets	0.84			0.89			1.00		1.57		2.17
Allowance for loan losses to nonaccruing loans⁽⁵⁾	176.30			206.90			192.96		154.77		114.98
Allowance for loan losses to total loans	1.01			0.79			0.83		0.90		1.16
Net charge-offs to average loans	0.07			0.20			—		0.01		0.06
Capital ratios:
Equity to total assets at end of period	10.97		%	11.76		%	12.39	%	12.40	%	13.25	%
Average equity to average assets	11.46			12.06			12.41		12.80		13.24
Dividend payout ratio	19.98			11.70			—		—		—
Dividends declared per common share	$	0.27		$	0.18		—		—		—


~~(1)~~	~~Net of allowances for loan losses and deferred loan costs.~~


~~(2)~~	For the years ended June 30, 2020 and 2019 the weighted average rate for municipal leases is adjusted for a 24% combined federal and state tax rate since the interest from these leases is tax exempt.For 2018 it was adjusted at 30% and all other years were at 37%.


~~(3)~~	~~Net interest income divided by average interest-earning assets.~~


~~(4)~~	~~See Part II, Item 7 - "Non-GAAP Financial Measures" for additional details.~~


~~(5)~~	Nonperforming assets include nonaccruing loans including certain restructured loans and real estate owned. At June 30, 2020, there were $6.3 million of restructured loans included in nonaccruing loans and $2.8 million, or 17.6%, of nonaccruing loans were current on their loan payments.