Company: SFBC
Filing Date: 2025-11-12
Form Type: 10-Q
Source: 0001541119-25-000041
Chunk: 114

Company: Sound Financial Bancorp, Inc.
Filing Date: 2025-11-12
Form: 10-Q
Item: Item 8
Chunk 114
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 increased by $1.6 million and $2.3 million, respectively, or 3.9% and 2.6%, primarily the result of seasonality as it relates to floating homes and affordability of manufactured homes in the current market as well as internal efficiencies in how we process these loans. The growth in these 

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portfolios were partially offset by a $20.3 million, or 27.8%, decline in construction and land loans largely due to project completions and a slowdown in new financing activities amid higher interest rates, as well as the payoff of a $17.0 million loan that had been risk rated as special mention. One-to-four-family loans and commercial business loans declined primarily due to loan repayments exceeding new originations.

At September 30, 2025, our loan portfolio, net of deferred loan fees, remained well-diversified. At that date, commercial and multifamily real estate loans accounted for 44.8% of total loans, one-to-four family loans, including home equity loans, accounted for 31.5% of total loans, commercial business loans accounted for 1.6% of total loans, and consumer loans, consisting of manufactured homes, floating homes, and other consumer loans, accounted for 16.3% of total loans. Construction and land loans accounted for 5.8% of total loans at September 30, 2025. 

Loans held-for-sale totaled $271 thousand at September 30, 2025, compared to $487 thousand at December 31, 2024. The decrease was primarily due to timing of mortgage originations and sales. 

Allowance for Credit Losses.  

The following table reflects the activity in our allowance for credit losses (“ACL”) during the periods indicated (dollars in thousands):

 Three Months Ended September 30,Nine Months Ended September 30, 2025202420252024ACL — Loans:Balance at beginning of period$8,536 $8,493 $8,499 $8,760 Charge-offs(57)(20)(107)(103)Recoveries20 6 28 16 Net charge-offs(37)(14)(79)(87)Provision for (release of) credit losses65 106 144 (88)Balance at end of period$8,564 $8,585 $8,564 $8,585 Reserve for Unfunded Commitments:Balance at beginning of period122