Sound Financial Bancorp (SFBC) investor relations material

Executive summary

• Net income for Q1 2026 was $1.6 million ($0.61 EPS), up 35.0% year-over-year and up from $1.2 million in Q1 2025, but down from $2.2 million in Q4 2025.

• Total assets increased 1.8% to $1.11 billion at March 31, 2026, driven by higher loan balances and a new $5.0 million equity investment.

• Loans and deposits both increased, with deposits up $19.6 million sequentially and $58.2 million year-over-year.

• Board declared a $0.21 per share cash dividend for Q2 2026, payable May 26, 2026.

• Nonperforming assets increased 22.1% to $7.5 million, or 0.67% of total assets, mainly due to new nonaccrual loans.

Financial highlights

• Net interest income grew 12.1% year-over-year to $9.0 million, with a 4.4% sequential increase.

• Net interest margin improved to 3.51% from 3.25% year-over-year and 3.49% from 3.36% sequentially.

• Provision for credit losses was $123 thousand, compared to a release of $203 thousand in Q1 2025.

• Noninterest income fell 17.1% year-over-year but increased 5.0% sequentially.

• Noninterest expense remained flat year-over-year at $7.9 million but rose 15.1% sequentially, mainly due to higher salaries and regulatory assessments.

• Deposits increased 2.1% to $968.5 million; uninsured deposits rose to 20.4% of total deposits.

Outlook and guidance

• Management expects continued payment of quarterly cash dividends at $0.21 per share, subject to board discretion.

• Liquidity position remains strong, with $145.5 million in cash and securities and significant borrowing capacity.

• The bank's CBLR of 10.62% exceeds current and forthcoming regulatory minimums.

• Management remains focused on sustainable long-term performance amid economic uncertainty and elevated interest rates.

• Improving funding dynamics and a healthy capital position provide flexibility to support loan demand.