Company: SFBC
Filing Date: 2025-08-12
Form Type: 10-Q
Source: 0001541119-25-000034
Chunk: 130

Company: Sound Financial Bancorp, Inc.
Filing Date: 2025-08-12
Form: 10-Q
Item: Item 8
Chunk 130
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interest income decreased $42 thousand, or 3.6%, to $1.1 million for the three months ended June 30, 2025, as compared to $1.2 million for the three months ended June 30, 2024, as reflected below (dollars in thousands):

 Three Months Ended June 30,AmountChangePercentChange 20252024Service charges and fee income$664 $761 $(97)(12.7)%Earnings on BOLI229 134 95 70.9 Mortgage servicing income263 279 (16)(5.7)Fair value adjustment on mortgage servicing rights(80)(116)36 (31.0)Net gain on sale of loans44 74 (30)(40.5)Other income— 30 (30)(100.0)Total noninterest income$1,120 $1,162 $(42)(3.6)%

The lower level of noninterest income for the three months ended June 30, 2025, compared to the same period in 2024, was primarily due to:

•a $97 thousand decrease in service charges and fee income, primarily due to a recovery of potential future lost fee income recorded in the second quarter of 2024 in connection with a vendor error; this decrease was partially offset by an increase in fees associated with new client acquisition in our specialty banking deposit accounts and higher interchange income in the current quarter; 

•a $16 thousand decrease in mortgage servicing income as a result of the portfolio paying down at a faster rate than originations replaced repayments; 

•a $30 thousand decrease in net gain on sale of loans due to fewer loans sold; and 

•a $30 thousand decrease in other income due to gain on disposal of assets due to insurance claims on the loss of fully depreciated assets in same quarter last year.

 These decreases were partially offset by:

•a $95 thousand increase in earnings from BOLI primarily due to the strategic decision to surrender and exchange existing policies into higher yielding policies in the first quarter of 2025, with the benefit of improve yields continuing into the second quarter of 2025, partially offset by fluctuations in financial markets which reduced the values of policies; and 

•a $36 thousand improvement in the adjustment for the fair value of mortgage servicing rights due to higher market value, partially offset by a smaller servicing portfolio.

Noninterest income decreased $42 thousand, or 1.9%, to