Security Federal Corporation Reports Increased Net Income and Stable Assets as of September 30, 2025

Security Federal Corporation reported a slight increase in total assets, reaching $1.61 billion as of September 30, 2025, compared to $1.61 billion at the end of 2024. This stability was primarily driven by a significant increase in available-for-sale (AFS) securities, which rose by $148.7 million, or 28.3%, to $674.3 million. However, cash and cash equivalents saw a substantial decline of $126.5 million, or 70.9%, attributed to the repayment of borrowings from the Federal Reserve Bank of Richmond. The company’s total loans receivable decreased by $9.5 million, or 1.3%, to $677.1 million, reflecting a drop in construction and commercial loans, offset by growth in residential and consumer loans.

For the third quarter of 2025, Security Federal reported net income available to common shareholders of $3.2 million, a 59.1% increase from $2.0 million in the same period of 2024. This growth was fueled by a rise in net interest income, which increased by $1.7 million, or 16.0%, to $12.1 million, alongside a reduction in the provision for credit losses. The company’s net interest margin improved to 3.17%, up from 2.87% a year earlier, driven by higher yields on loans and a decrease in interest expenses on borrowings.

The company’s non-interest income remained stable at $2.6 million for both the third quarters of 2025 and 2024. However, for the nine months ended September 30, 2025, non-interest income increased by $273,000, or 3.7%, to $7.7 million, primarily due to a rise in other non-interest income. Non-interest expenses also rose, increasing by $1.0 million, or 11.1%, to $10.4 million, largely due to higher compensation and employee benefits costs, which were up 12.1% as the company expanded its workforce to support growth.

In terms of operational metrics, total deposits increased by $41.4 million, or 3.1%, to $1.37 billion, driven by growth in higher-cost certificates of deposit and money market accounts. The company had no outstanding borrowings from the Federal Reserve as of September 30, 2025, compared to $50 million at the end of 2024, reflecting improved liquidity. Shareholders’ equity also saw an increase of $12.4 million, or 0.1%, to $194.8 million, supported by net income and a reduction in accumulated other comprehensive loss.

Looking ahead, Security Federal Corporation remains focused on maintaining its capital position and managing its liquidity effectively. The company is well-capitalized, exceeding all regulatory capital requirements, with a Common Equity Tier 1 Capital ratio of 18.7% as of September 30, 2025. Management continues to monitor market conditions and is prepared to adapt its strategies to ensure sustained growth and profitability in the evolving economic landscape.