Company: SFBC
Filing Date: 2025-11-12
Form Type: 10-Q
Source: 0001541119-25-000041
Chunk: 87

Company: Sound Financial Bancorp, Inc.
Filing Date: 2025-11-12
Form: 10-Q
Item: Item 8
Chunk 87
---
segment) basis when similar risk characteristics exist. Historical credit loss experience for both the Company and segment-specific peers provides the basis for the estimate of expected credit losses. Segments are based upon federal call report segmentation. The reserve was applied on a loan-by-loan basis and condensed into the applicable segments reported below.  The ACL is determined using quantitative and qualitative analysis. The quantitative analysis utilizes macroeconomic variables to establish a quantitative relationship between economic conditions and loan performance through an economic cycle. Qualitative adjustments include but are not limited to changes in lending policies; changes in the nature and volume of the portfolio; changes in staff experience levels; changes in the volume or trends of classified loans, delinquencies, and nonaccrual loans; concentration risk; value of underlying collateral; competitive, legal, and regulatory factors; changes in the loan review system; and economic conditions. We evaluate our ACL policy and judgments on an ongoing basis and update them as necessary based on changing conditions.   See “Note 1—Organization and Significant Accounting Policies” in the Company’s 2024 Form 10-K for further information on the Company’s ACL accounting policy.  

13

The following tables summarize the activity in the ACL - loans for the periods indicated (in thousands): Three Months Ended September 30, 2025 BeginningAllowanceCharge-offsRecoveriesProvision for (Release of) Credit LossesEndingAllowanceOne-to-four family$3,327 $— $— $(47)$3,280 Home equity360 — — (6)354 Commercial and multifamily1,236 — — 74 1,310 Construction and land269 — — 64 333 Manufactured homes(1)1,395 (47)— 31 1,379 Floating homes1,410 — — (47)1,363 Other consumer(2)451 (10)20 (21)440 Commercial business88 — — 17 105 Total$8,536 $(57)$20 $65 $8,564 (1)During the three months ended September 30,2025, there was one manufactured loan for $47 thousand originated in 2023 that was charged off.(2)During the three months ended September 30,2025, there was one automobile loan for $1 thousand originated in 2021 that was charged off, with the remainder of the gross charge-offs of other