Company: SFBC
Filing Date: 2025-05-13
Form Type: 10-Q
Source: 0001541119-25-000023
Chunk: 99

Company: Sound Financial Bancorp, Inc.
Filing Date: 2025-05-13
Form: 10-Q
Item: Item 8
Chunk 99
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7.2 million, or 2.7%, and $915 thousand, or 5.9%, respectively, primarily due to loan repayments exceeding new originations. These reductions were partially offset by a $21.3 million, or 5.7%, increase in commercial and multifamily loans, driven by the conversion of construction projects to permanent financing. Home equity loans also rose by $1.4 million, or 5.3%, as homeowners likely utilized their home equity lines to access liquidity, particularly in response to 

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elevated living costs and inflationary pressures.

At March 31, 2025, our loan portfolio, net of deferred loan fees, remained well-diversified. At that date, commercial and multifamily real estate loans accounted for 44.2% of total loans, one-to-four family loans, including home equity loans, accounted for 32.6% of total loans, commercial business loans accounted for 1.7% of total loans, and consumer loans, consisting of manufactured homes, floating homes, and other consumer loans, accounted for 16.7% of total loans. Construction and land loans accounted for 4.8% of total loans at March 31, 2025. 

Loans held-for-sale totaled $2.27 million at March 31, 2025, compared to $487 thousand at December 31, 2024. The increase was primarily due to timing of mortgage originations and sales. 

Allowance for Credit Losses.  

The following table reflects the activity in our allowance for credit losses (“ACL”) during the periods indicated (dollars in thousands):

 Three Months Ended March 31, 20252024ACL — Loans:Balance at beginning of period$8,499 $8,760 Charge-offs(27)(62)Recoveries6 6 Net charge-offs(21)(56)(Release of) provision for credit losses(85)(106)Balance at end of period$8,393 $8,598 Reserve for Unfunded Commitments:Balance at beginning of period234 193 (Release of) provision for credit losses(118)73 Balance at end of period116 266 ACL$8,509 $8,864 Ratio of net charge-offs during the period to average loans outstanding during the period(0.01)%(0.03)%

Our ACL — loans decreased $106 thousand, or 1.2%, to $8