Company: SFBC
Filing Date: 2025-03-18
Form Type: 10-K
Source: 0001541119-25-000009
Chunk: 122

Company: Sound Financial Bancorp, Inc.
Filing Date: 2025-03-18
Form: 10-K
Item: Item 7
Chunk 122
---
 loans, due to the current interest rate environment. These decreases were partially offset by a $93 thousand increase in service charges and fee income resulting from increases in late fees on loans, interchange income and income related to a new, multi-year agreement with our debit card provider that was effective in 2024. Further, a $215 thousand upward adjustment in the fair value of MSRs was due to a change in prepayment speeds, servicing costs, and discount rate. Finally, other income increased $38 thousand due to an insurance claim on equipment in 2024. 

Noninterest Expense.  Noninterest expense was $30.1 million during the years ended December 31, 2024 and 2023, as reflected below (dollars in thousands):

 Year Ended December 31,AmountChangePercentChange 20242023Salaries and benefits$17,590 $17,135 $455 2.7 %Operations5,894 6,095 (201)(3.3)Regulatory assessments787 688 99 14.4 Occupancy1,665 1,810 (145)(8.0)Data processing4,226 4,388 (162)(3.7)Net loss and expenses on OREO and repossessed assets(31)13 (44)(338.5)Total noninterest expense$30,131 $30,129 $2 — %

61

The increase in noninterest expenses during the year ended December 31, 2024 compared to the year ended December 31, 2023, was primarily driven by a $455 thousand increase in salaries and benefits, largely due to higher incentive compensation expenses, increased medical expenses, and higher commission expenses. This increase was partially offset by a decrease in salaries and contractor expenses. In addition, regulatory assessments increased $99 thousand as a result of a higher deposit insurance assessment rate introduced at the beginning of 2023 and the Company’s increased asset size. Partially offsetting these increases were several decreases in noninterest expenses. Operations expenses decreased by $201 thousand mainly due to reductions in office expenses, loan origination fees, travel expenses, state and local taxes, and charitable contributions, partially offset by higher professional fees (tax and consulting) and increased costs related to deposit products, especially debit card processing expenses. Data processing expenses decreased $162 thousand due to lower costs associated with the Company’s core processor and occupancy expenses decreased by 145 thousand primarily because of fully amort