Company: SFBC
Filing Date: 2025-08-12
Form Type: 10-Q
Source: 0001541119-25-000034
Chunk: 20

Company: Sound Financial Bancorp, Inc.
Filing Date: 2025-08-12
Form: 10-Q
Item: Item 2
Chunk 20
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 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 average balance of savings and money market accounts. The average cost of total deposits decreased 27 basis points to 2.35% for the six months ended June 30, 2025, from 2.62% for the six months ended June 30, 2024.

Interest expense on borrowings, comprised solely of FHLB advances, was $529 thousand for the six months ended June 30, 2025, compared to $859 thousand for the six months ended June 30, 2024, reflecting the decreased use of FHLB advances to supplement our liquidity needs. The average cost of FHLB advances decreased 5 basis points to 4.27% for the six months ended June 30, 2025, compared to 4.32% for the same period in 2024. The average cost of FHLB advances declined due to same reason note above. The average balance of FHLB advances was $25.0 million for the six months ended June 30, 2025, compared to $40.0 million for the six months ended June 30, 2024 following the payoff of an FHLB advance during the fourth quarter of 2024. Interest expense on subordinated notes was $336 thousand for both the six months ended June 30, 2025 and 2024.

Net Interest Income.   

Q2 2025 vs Q2 2024. Net interest income increased $1.8 million, or 24.3%, to $9.3 million for the three months ended June 30, 2025, from $7.4 million for the three months ended June 30, 2024. The increase in net interest income was mainly the result of decreased funding costs, primarily from lower average rates paid on all categories of interest-bearing deposits and a lower average balance of borrowings, as well as higher average yield on interest-earning assets due