Security Midwest Bancorp Reports Q3 2025 Financial Results with Decrease in Net Income

Security Midwest Bancorp, Inc. reported its financial results for the third quarter and the first nine months of 2025, revealing a net income of $281,057 for the three months ended September 30, 2025, a decrease of 24.3% compared to $371,263 for the same period in 2024. For the nine months ended September 30, 2025, net income increased to $1,032,150, up 13.7% from $907,822 in the prior year. The company’s total interest income for the third quarter was $2.51 million, down 3.6% from $2.61 million in the previous year, while total interest income for the nine months rose to $7.51 million, a slight increase from $7.38 million.

The company experienced a significant decrease in total assets, which fell to $203.87 million as of September 30, 2025, down 5% from $214.54 million at the end of 2024. This decline was primarily attributed to a $19.62 million drop in total deposits, which decreased to $179.75 million. The decrease in deposits was largely due to a reduction in demand deposits, which fell by $15.15 million. In contrast, the company’s loans held for sale increased to $338,453, reflecting a growing focus on originating loans for sale in the secondary market.

In terms of operational developments, Security Midwest Bancorp completed a common stock offering in July 2025, raising approximately $8.9 million in gross proceeds. This capital infusion contributed to a 66.5% increase in shareholders' equity, which rose to $23.25 million by the end of September 2025. The company also reported a slight increase in gross loans, which rose to $115.23 million, driven by growth in construction and development loans and commercial and industrial loans.

The company’s provision for credit losses was notably lower, with no provision recorded for the third quarter of 2025, compared to $27,884 in the same quarter of 2024. The allowance for credit losses stood at $1.15 million, representing 1% of total loans, a decrease from 1.22% a year earlier. This reduction in provisions reflects improved asset quality, as nonperforming loans decreased to $679,000 from $1.23 million at the end of 2024.

Looking ahead, Security Midwest Bancorp plans to continue its strategy of expanding its loan portfolio, particularly in owner-occupied residential real estate and commercial loans. The company is also focused on enhancing its deposit base through improved product offerings and services, including mobile banking capabilities. Management remains optimistic about the potential for growth, despite the challenges posed by market conditions and competition in the financial services sector.