Company: SFBC
Filing Date: 2025-03-18
Form Type: 10-K
Source: 0001541119-25-000009
Chunk: 123

Company: Sound Financial Bancorp, Inc.
Filing Date: 2025-03-18
Form: 10-K
Item: Item 7
Chunk 123
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ized leasehold improvements. 

The efficiency ratio for the year ended December 31, 2024 was 84.50%, compared to 77.54% for the year ended December 31, 2023. The deterioration in the efficiency ratio was due to lower interest income and noninterest income in 2024.

Income Tax Expense. The provision for income taxes decreased $555 thousand, or 35.6% to $1.0 million for the year ended December 31, 2024, compared to $1.6 million for the year ended December 31, 2023 due to lower pre-tax income. The effective tax rates for the years ended December 31, 2024 and 2023 were 17.8% and 17.3%, respectively. The effective tax rate was higher in 2024 as a result of nontaxable income related to the BOLI death benefit received in prior year.

Capital and Liquidity

Capital. Stockholders’ equity totaled $103.7 million at December 31, 2024 and $100.7 million at December 31, 2023.  In addition to net income of $4.6 million, other sources of capital during 2024 included $390 thousand related to stock-based compensation and $269 thousand in proceeds from stock option exercises. Uses of capital during 2024 included $56 thousand of other comprehensive income, net of tax, $1.9 million of dividends paid on common stock, $65 thousand of stock repurchases and $218 thousand of stock surrendered to satisfy tax withholding obligations upon the vesting of restricted stock awards.

We paid quarterly dividends aggregating $0.76 per common share during the year ended December 31, 2024 and quarterly dividends aggregating $0.74 per common share during the year ended December 31, 2023. This equates to a dividend payout ratio of 42.0% in 2024 and 25.7% in 2023. The Company expects to continue its current practice of paying quarterly cash dividends on its common stock, subject to the Board of Directors’ discretion to modify or terminate this practice at any time and for any reason. Assuming continued payment of cash dividends during 2025 at the current quarterly dividend rate of $0.19 per share, our total dividend paid each quarter would be approximately $488 thousand based on the number of our outstanding shares at December 31, 2024. The dividends, if any,