AIKEN, S.C., July 31, 2026 (GLOBE NEWSWIRE) -- Security Federal Corporation (the "Company") (OTCID: SFDL), the holding company for Security Federal Bank (the "Bank"), today announced earnings and financial results for the three and six months ended June 30, 2026.
Second Quarter Financial Highlights
Net income available to common shareholders was $3.7 million, or $1.19 per common share, for the second quarter of 2026, an increase of $1.3 million, or 55.4% from the second quarter of 2025. The increase in net income was driven by higher net interest income (up $1.2 million, or 10.6%) and non-interest income (up $615,000, or 23.7%), which offset increased provision for credit losses (up $240,000, or 100.0%) and non-interest expense (up $181,000, or 1.7%).
| Quarter Ended | |||||
| (Dollars in Thousands, except for Earnings per Share) | 6/30/2026 | 6/30/2025 | |||
| Total interest income | - | 18,926 | - | 19,449 | |
| Total interest expense | 6,417 | 8,137 | |||
| Net interest income | 12,509 | 11,312 | |||
| Provision for credit losses | 240 | - | |||
| Net interest income after provision for credit losses | 12,269 | 11,312 | |||
| Non-interest income | 3,210 | 2,595 | |||
| Non-interest expense | 10,542 | 10,361 | |||
| Income before income taxes | 4,937 | 3,546 | |||
| Provision for income taxes | 832 | 756 | |||
| Net income | 4,105 | 2,790 | |||
| Preferred stock dividends | 415 | 415 | |||
| Net income available to common shareholders | - | 3,690 | - | 2,375 | |
| Earnings per common share (basic) | - | 1.19 | - | 0.75 | |
Year-to-Date (Six Months) Comparative Financial Highlights
Net income available to common shareholders was $6.8 million, or $2.19 per common share, for the first six months of 2026, an increase of $1.8 million, or 36.7% from the first six months of 2025. The increase in net income was driven by higher net interest income (up $2.2 million, or 10.0%) and non-interest income (up $1.1 million, or 21.7%), which offset increased provision for credit losses (up $465,000, or 100.0%) and non-interest expense (up $900,000, or 4.5%).
| For the Six Months Ended | |||||
| (Dollars in Thousands, except for Earnings per Share) | 6/30/2026 | 6/30/2025 | |||
| Total interest income | - | 37,747 | - | 38,682 | |
| Total interest expense | 12,957 | 16,141 | |||
| Net interest income | 24,790 | 22,541 | |||
| Provision for credit losses | 465 | - | |||
| Net interest income after provision for credit losses | 24,325 | 22,541 | |||
| Non-interest income | 6,134 | 5,039 | |||
| Non-interest expense | 21,102 | 20,202 | |||
| Income before income taxes | 9,357 | 7,378 | |||
| Provision for income taxes | 1,737 | 1,582 | |||
| Net income | 7,620 | 5,796 | |||
| Preferred stock dividends | 830 | 830 | |||
| Net income available to common shareholders | - | 6,790 | - | 4,966 | |
| Earnings per common share (basic) | - | 2.19 | - | 1.56 | |
Credit Quality
The Bank recorded a $350,000 provision for credit losses on loans and a $115,000 provision for credit losses on unfunded commitments, resulting in a total provision for credit losses of $465,000 for the first six months of 2026 compared to no provision for credit losses during the same period in 2025. The following table shows the non-performing assets and allowance for credit losses balances at the periods indicated.
| At Period End (dollars in thousands): | 6/30/2026 | 12/31/2025 | 6/30/2025 | |||
| Non-performing assets | - | 5,945 | - | 5,842 | - | 5,954 |
| Non-performing assets to total assets | 0.37% | 0.36% | 0.37% | |||
| Allowance for credit losses | - | 13,685 | - | 13,529 | - | 14,007 |
| Allowance for credit losses to gross loans | 1.98% | 1.97% | 2.00% | |||
Balance Sheet Highlights and Capital Ratios
| Dollars in thousands (except per share amounts) | 6/30/2026 | 12/31/2025 | 6/30/2025 | |||
| Total assets | - | 1,603,495 | - | 1,618,084 | - | 1,625,236 |
| Cash and cash equivalents | 84,678 | 75,335 | 142,190 | |||
| Total loans receivable, net | 677,710 | 676,182 | 685,501 | |||
| Investment securities | 750,698 | 776,285 | 707,609 | |||
| Deposits | 1,360,517 | 1,371,777 | 1,383,201 | |||
| Borrowings | 26,107 | 35,262 | 39,566 | |||
| Total shareholders' equity | 205,219 | 200,455 | 191,279 | |||
| Common shareholders' equity | 122,270 | 117,506 | 108,330 | |||
| Common equity book value per share | - | 39.54 | - | 37.74 | - | 34.02 |
| Total risk based capital to risk weighted assets (1) | 21.23% | 20.56% | 20.46% | |||
| CET1 capital to risk weighted assets (1) | 19.98% | 19.30% | 19.20% | |||
| Tier 1 leverage capital ratio (1) | 10.83% | 10.18% | 10.54% | |||
| (1) - Ratio is calculated using Bank only information and not consolidated information | ||||||
Security Federal has 19 full-service branches located in Aiken, Ballentine, Clearwater, Columbia, Graniteville, Langley, Lexington, North Augusta, Ridge Spring, Wagener and West Columbia, South Carolina and Augusta and Evans, Georgia. A full range of financial services, including trust and investments, are provided by the Bank and insurance services are provided by the Bank's wholly owned subsidiary, Security Federal Insurance, Inc.
