UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended December 31, 2021

☐ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from ____________ to _______________

Commission File Number: 0-51176

KENTUCKY FIRST FEDERAL BANCORP

(Exact name of registrant as specified in its charter)

United States of America		61-1484858
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

655 Main Street, Hazard, Kentucky 41702

(Address of principal executive offices)(Zip Code)

(502) 223-1638

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading symbol(s)		Name of each exchange on which registered
Common Stock, $0.01 par value per share		KFFB		The NASDAQ Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days: Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definition of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-Accelerated filer	☒	Smaller Reporting Company	☒
		Emerging Growth Company	☐

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 is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: At February 9, 2022, the latest practicable date, the Corporation had 8,218,215 shares of $.01 par value common stock outstanding.

INDEX

			Page
PART I	FINANCIAL INFORMATION		1

	ITEM 1	FINANCIAL STATEMENTS

		Condensed Consolidated Balance Sheets	1

		Condensed Consolidated Statements of Operations	2

		Condensed Consolidated Statements of Comprehensive Income	3

		Consolidated Statements of Changes in Shareholders’ Equity	4

		Condensed Consolidated Statements of Cash Flows	6

		Notes to Condensed Consolidated Financial Statements	8

	ITEM 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	27

	ITEM 3	Quantitative and Qualitative Disclosures About Market Risk	38

	ITEM 4	Controls and Procedures	38

PART II	OTHER INFORMATION		39

SIGNATURES			41

PART I-FINANCIAL INFORMATION

ITEM 1: Financial Statements

Kentucky First Federal Bancorp

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands, except share data)

	December 31,			June 30,
	2021			2021
ASSETS

Cash and due from financial institutions	$	3,035		$	1,834
Fed funds sold		19,006			5,001
Interest-bearing demand deposits		23,251			14,813
Cash and cash equivalents		45,292			21,648

Time deposits in other financial institutions		–			247
Securities available-for-sale		30			33
Securities held-to-maturity, at amortized cost- approximate fair value of $421 and $476 at December 31, 2021 and June 30, 2021, respectively		411			462
Loans held for sale		585			1,307
Loans, net of allowance of $1,603 and $1,622 at December 31, 2021 and June 30, 2021, respectively		276,684			297,902
Real estate owned, net		51			82
Premises and equipment, net		4,646			4,697
Federal Home Loan Bank stock, at cost		6,498			6,498
Accrued interest receivable		649			694
Bank-owned life insurance		2,711			2,672
Goodwill		947			947
Prepaid federal income taxes		208			40
Prepaid expenses and other assets		856			834

Total assets	$	339,568		$	338,063

LIABILITIES AND SHAREHOLDERS’ EQUITY

Deposits	$	236,838		$	226,843
Federal Home Loan Bank advances		48,822			56,873
Advances by borrowers for taxes and insurance		246			838
Accrued interest payable		16			20
Deferred income taxes		579			614
Other liabilities		408			579
Total liabilities		286,909			285,767

Commitments and contingencies		–			–

Shareholders’ equity
Preferred stock, 500,000 shares authorized, $.01 par value; no shares issued and outstanding		–			–
Common stock, 20,000,000 shares authorized, $.01 par value; 8,596,064 shares issued		86			86
Additional paid-in capital		34,893			34,916
Retained earnings		20,718			20,364
Unearned employee stock ownership plan (ESOP), 917 shares and 10,255 shares at December 31, 2021 and June 30, 2021, respectively		(9	)		(102	)
Treasury shares at cost, 377,849 and 369,349 common shares at December 31, 2021 and June 30, 2021, respectively		(3,029	)		(2,968	)
Accumulated other comprehensive income		–			–
Total shareholders’ equity		52,659			52,296

Total liabilities and shareholders’ equity	$	339,568		$	338,063

See accompanying notes to condensed consolidated financial statements.

Kentucky First Federal Bancorp

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(Dollars in thousands, except per share data)

	Six months ended December 31,						Three months ended December 31,
	2021			2020			2021		2020
Interest income
Loans, including fees	$	5,677		$	5,936		$	2,743	$	2,960
Mortgage-backed securities		6			8			3		4
Other securities		--			3			--		--
Interest-bearing deposits and other		72			84			35		38
Total interest income		5,755			6,031			2,781		3,002

Interest expense
Interest-bearing demand deposits		19			15			10		8
Savings		135			125			67		66
Certificates of Deposit		565			800			274		352
Deposits		719			940			351		426
Borrowings		198			228			97		103
Total interest expense		917			1,168			448		529
Net interest income		4,838			4,863			2,333		2,473
Provision for loan losses		--			192			--		108
Net interest income after provision for loan losses		4,838			4,671			2,333		2,365

Non-interest income
Earnings on bank-owned life insurance		40			39			21		20
Net gain on sales of loans		208			155			46		97
Net gain (loss) on sales of real estate owned		(8	)		(18	)		3		(19	)
Valuation adjustment for real estate owned		--			(19	)		--		(19	)
Other		88			94			30		44
Total non-interest income		328			251			100		123
Non-interest expense
Employee compensation and benefits		2,438			2,644			1,096		1,301
Data processing		307			292			186		145
Occupancy and equipment		301			280			150		142
FDIC insurance premiums		26			88			22		31
Voice and data communications		62			57			30		36
Advertising		86			76			43		39
Outside service fees		102			96			75		33
Auditing and accounting		80			79			26		39
Regulatory assessments		52			--			26		--
Foreclosure and real estate owned expenses (net)		44			47			38		30
Franchise and other taxes		91			130			90		65
Other		286			323			112		168
Total non-interest expense		3,875			4,112			1,894		2,029

Income before income taxes		1,291			810			539		459

Income tax expense		241			155			57		89

NET INCOME	$	1,050		$	655		$	482	$	370

EARNINGS PER SHARE
Basic and diluted	$	0.13		$	0.08		$	0.06	$	0.04
DIVIDENDS PER SHARE	$	0.20		$	0.20		$	0.10	$	0.10

See accompanying notes to condensed consolidated financial statements.

Kentucky First Federal Bancorp

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

(In thousands)

	Six months ended December 31,					Three months ended December 31,
	2021		2020			2021		2020
Net income	$	1,050	$	655		$	482	$	370

Other comprehensive gains (losses), net of tax:
Unrealized holding Gains (losses) on securities designated as available-for-sale, net of taxes of $0, $(1), $0 and $0 during the respective periods		--		(2	)		--		--
Comprehensive income	$	1,050	$	653		$	482	$	370

See accompanying notes to condensed consolidated financial statements.

Kentucky First Federal Bancorp

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

For the six months ended

(Dollar amounts in thousands, except per share data)

December 31, 2021

	Common stock		Additional paid-in capital			Retained earnings			Unearned employee stock ownership plan (ESOP)			Treasury shares			Accumulated other comprehensive income		Total
Balance at June 30, 2021	$	86	$	34,916		$	20,364		$	(102	)	$	(2,968	)	$	-	$	52,296

Net income		–		–			1,050			–			–			–		1,050
Allocation of ESOP shares		–		(23	)		–			93			–			–		70
Acquisition of shares for Treasury		–		–			–			–			(61	)		–		(61	)
Cash dividends of $0.20 per common share		–		–			(696	)		–			–			–		(696	)

Balance at December 31, 2021	$	86	$	34,893		$	20,718		$	(9	)	$	(3,029	)	$	–	$	52,659

December 31, 2020

	Common stock		Additional paid-in capital			Retained earnings		Unearned employee stock ownership plan (ESOP)			Treasury shares			Accumulated other comprehensive income		Total
Balance at June 30, 2020	$	86	$	34,981		$	19,932	$	(289	)	$	(2,801	)	$	2	$	51,911

Net income		–		–			655		–			–			–		655
Allocation of ESOP shares		–		(33	)		–		93			–			–		60
Acquisition of shares for Treasury		–		–			–		–			(101	)		–		(101	)
Other comprehensive loss		–		–			–		–

SEC Form 10-Q filed by Kentucky First Federal Bancorp