Company: SFBC
Filing Date: 2025-08-12
Form Type: 10-Q
Source: 0001541119-25-000034
Chunk: 126

Company: Sound Financial Bancorp, Inc.
Filing Date: 2025-08-12
Form: 10-Q
Item: Item 8
Chunk 126
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 as higher rates offered on some of these products as compared to new certificate accounts, partially offset by a lower average rate paid on these accounts, which declined 21 basis points to 2.61% from 2.82%. The rate decrease reflects competitive repricing strategies implemented to manage overall funding costs in a stabilizing rate environment. 

Interest expense on borrowings, comprised solely of FHLB advances, decreased $162 thousand , primarily due to a $15.0 million decline in average borrowings following the payoff of an FHLB advance during the fourth quarter of 2024. The average balance of FHLB advances was $25.0 million for the three months ended June 30, 2025, compared to $40.0 million for the three months ended June 30, 2024. The average rate paid on borrowings decreased three basis points to 4.28% for the quarter ended June 30, 2025, compared to 4.31% for the same quarter in 2024. Interest expense on subordinated notes was $168 thousand for both the three months ended June 30, 2025 and June 30, 2024, with no material changes in the average balance or rate paid. 

Six Months Ended June 30,AmountChangePercent                        Change20252024Deposit$10,430 $11,696 $(1,266)(10.8)%Borrowings529 859 (330)(38.4)Subordinated notes336 336 — —   Total interest expense$11,295 $12,891 $(1,596)(12.4)%

YTD 2025 vs. YTD 2024. Interest expense decreased $1.6 million, or 12.4%, to $11.3 million for the six months ended June 30, 2025, from $12.9 million for the six months ended June 30, 2024. Interest expense on deposits decreased $1.3 million, or 10.8%, to $10.4 million for the six months ended June 30, 2025, compared to $11.7 million for the six months ended June 30, 2024. The decrease was primarily the result of lower average rates paid on all categories of interest-bearing deposits and borrowings, as well as a lower average balance of demand and NOW accounts, certificate accounts, and borrowings, partially offset by an increase in the