Security Federal Corp Q2 2024: Assets $138M, Net Income $1M

TL;DR

**SEC FILING: Security Federal Corp Q2 2024 assets $138M, net income $1M. Equity $125M.**

AI Summary

Security Federal Corp reported total assets of $138.2 million and total liabilities of $12.6 million for the quarter ending June 30, 2024. Net income for the three months ended June 30, 2024, was $1.0 million, or $0.01 per diluted share. The company's total equity stood at $125.6 million as of June 30, 2024.

Why It Matters

This filing provides a snapshot of Security Federal Corp's financial health, indicating its asset base, liabilities, and profitability for the second quarter of 2024.

Risk Assessment

Risk Level: low — The filing appears to be a routine quarterly report with no immediately apparent significant negative financial events.

Key Numbers

• $138.2B — Total Assets (As of June 30, 2024, indicating the company's total resources.)
• $12.6B — Total Liabilities (As of June 30, 2024, representing the company's obligations.)
• $1.0B — Net Income (For the three months ended June 30, 2024, showing profitability.)
• $0.01 — Diluted EPS (For the three months ended June 30, 2024, indicating earnings per share.)
• $125.6B — Total Equity (As of June 30, 2024, representing the net worth of the company.)

Key Players & Entities

• Security Federal Corp (company) — Filer of the 10-Q report
• 20240630 (date) — End of the reporting period
• $138,187 (dollar_amount) — Total assets for the period ending 20240630
• $12,569 (dollar_amount) — Total liabilities for the period ending 20240630
• $1,000 (dollar_amount) — Net income for the three months ended 20240630
• $0.01 (dollar_amount) — Earnings per diluted share for the three months ended 20240630
• $125,690 (dollar_amount) — Total equity for the period ending 20240630

FAQ

Key Financial Figures

• $0.01 — AT: SHARES: Common Stock, par value $0.01 per share August 9, 2024 3,196,937

Filing Documents

• sfdl20240630_10q.htm (10-Q) — 3105KB
• ex_674338.htm (EX-31.1) — 14KB
• ex_674339.htm (EX-31.2) — 14KB
• ex_674340.htm (EX-32) — 8KB
• 0001437749-24-025690.txt ( ) — 14282KB
• sfdl-20240630.xsd (EX-101.SCH) — 68KB
• sfdl-20240630_cal.xml (EX-101.CAL) — 67KB
• sfdl-20240630_def.xml (EX-101.DEF) — 531KB
• sfdl-20240630_lab.xml (EX-101.LAB) — 424KB
• sfdl-20240630_pre.xml (EX-101.PRE) — 570KB
• sfdl20240630_10q_htm.xml (XML) — 3864KB

Financial Statements (unaudited)

Financial Statements (unaudited): 3 Consolidated Balance Sheets at June 30, 2024 and December 31, 2023 3 Consolidated Statements of Income for the Three and Six Months Ended June 30, 2024 and 2023 4 Consolidated Statements of Comprehensive Income for the Three and Six Months Ended June 30, 2024 and 2023 5 Consolidated Statements of Changes in Shareholders' Equity for the Three and Six Months Ended June 30, 2024 and 2023 6 Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2024 and 2023 7

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 8 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 28 Item 3.

Quantitative and Qualitative Disclosures about Market Risk

Quantitative and Qualitative Disclosures about Market Risk 36 Item 4.

Controls and Procedures

Controls and Procedures 36 PART II. OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 37 Item 1A.

Risk Factors

Risk Factors 37 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 37 Item 3. Defaults Upon Senior Securities 37 Item 4. Mine Safety Disclosures 37 Item 5. Other Information 37 Item 6. Exhibits 38

Signatures

Signatures 39 SCHEDULES OMITTED All schedules other than those indicated above are omitted because of the absence of the conditions under which they are required or because the information is included in the consolidated financial statements and related notes. 2 Table of Contents SECURITY FEDERAL CORPORATION AND SUBSIDIARIES Part 1. Financial Information

Financial Statements

Item 1. Financial Statements Consolidated Balance Sheets June 30, 2024 December 31, 2023 Dollars in thousands, except per share amounts (Unaudited) (Audited) ASSETS: Cash and Cash Equivalents $ 138,350 $ 128,284 Certificates of Deposit with Other Banks 2,350 2,350 Investments: Available For Sale ("AFS") 519,434 537,640 Held To Maturity ("HTM") Net of Allowance for Credit Losses of $ 0 (Fair Value of $ 138,187 and $ 158,540 at June 30, 2024 and December 31, 2023, Respectively) 142,601 163,072 Total Investments 662,035 700,712 Loans Receivable, Net: Held For Sale 2,141 967 Held For Investment (Net of Allowance for Credit Losses of $ 12,958 and $ 12,569 at June 30, 2024 and December 31, 2023, Respectively) 653,061 621,562 Total Loans Receivable, Net 655,202 622,529 Accrued Interest Receivable 5,465 5,512 Operating Lease Right-of-Use ("ROU") Assets 1,167 1,402 Land Held for Sale 938 938 Premises and Equipment, Net 29,762 28,637 Federal Home Loan Bank ("FHLB") Stock, at Cost 1,041 922 Bank Owned Life Insurance ("BOLI") 28,299 27,954 Goodwill 1,200 1,200 Other Assets 17,292 29,231 Total Assets $ 1,543,101 $ 1,549,671 LIABILITIES: Deposit Accounts $ 1,236,154 $ 1,194,997 Borrowings from Federal Reserve Bank ("FRB") 65,000 119,200 Other Borrowings 21,986 19,180 Junior Subordinated Debentures 5,155 5,155 Subordinated Debentures 26,500 26,500 Operating Lease Liabilities 1,203 1,442 Other Liabilities 11,212 10,835 Total Liabilities 1,367,210 1,377,309 SHAREHOLDERS' EQUITY: Senior Non-Cumulative Perpetual Preferred Stock, Series ECIP, $ 1,000 Par Value; 82,949 Shares Authorized, Issued and Outstanding at June 30, 2024 and December 31, 2023 82,949 82,949 Common Stock, $ 0.01 Par Value; 5,000,000 Shares Authorized; 3,457,212 Shares Issued and 3,196,443 Shares Outstanding at June 30, 2024 and 3,456,136 Shares Issued and 3,228,777 Shares Outstanding at December 31, 2023, Respective

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements NOTE 1 - BASIS OF PRESENTATION The accompanying unaudited consolidated financial statements were prepared in accordance with instructions for Form 10 -Q and accounting principles generally accepted in the United States of America ("GAAP"); therefore, they do not include all disclosures necessary for a complete presentation of financial condition, results of operations, and cash flows. Such statements are unaudited but, in the opinion of management, reflect all adjustments, which are of a normal recurring nature and necessary for a fair presentation of results for the selected interim periods. The information included in Security Federal Corporation's (the "Company") Form 10 -K for the year ended December 31, 2023 (" 2023 Form 10 -K") should be referred to when reviewing interim financial statements. The unaudited consolidated results of operations for the three and six months ended June 30, 2024 are not necessarily indicative of the results that may be expected for the year ending December 31, 2024 or any other period. The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. NOTE 2 - PRINCIPLES OF CONSOLIDATION The accompanying unaudited consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, Security Federal Bank (the "Bank") and the Bank's wholly owned subsidiaries, Security Federal Investments, Inc. ("SFINV") and Security Federal Insurance, Inc. ("SFINS"). SFINV was formed to hold investment securities and allow for better management of the securities portfolio. SFINS is an insurance agency offering auto, business

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements NOTE 5 - STOCK-BASED COMPENSATION Certain officers and directors of the Company participate in incentive and non-qualified stock option plans. Options are granted at exercise prices not less than the fair value of the Company's common stock on the date of the grant. At June 30, 2024 and 2023 , the Company had no options outstanding and there was no activity during the three and six months ended June 30, 2024 and 2023 . At those dates, there were 50,000 options available for grants. NOTE 6 - INVESTMENTS, AVAILABLE FOR SALE ("AFS") AFS securities are recorded at fair market value. There was no allowance for credit losses for AFS securities as of June 30, 2024 and December 31, 2023 . The amortized cost, gross unrealized gains, gross unrealized losses, and fair values of AFS securities at the dates indicated were as follows: June 30, 2024 Dollars in thousands Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Student Loan Pools $ 44,197 $ 109 $ ( 251 ) $ 44,055 Small Business Administration ("SBA") Bonds 67,617 403 ( 2,636 ) 65,384 Tax Exempt Municipal Bonds 20,537 355 ( 1,062 ) 19,830 Taxable Municipal Bonds 64,571 — ( 11,986 ) 52,585 Mortgage-Backed Securities ("MBS") 367,430 119 ( 29,969 ) 337,580 Total AFS Securities $ 564,352 $ 986 $ ( 45,904 ) $ 519,434 December 31, 2023 Dollars in thousands Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Student Loan Pools $ 51,022 $ 72 $ ( 728 ) $ 50,366 SBA Bonds 79,014 416 ( 2,677 ) 76,753 Tax Exempt Municipal Bonds 21,501 643 ( 908 ) 21,236 Taxable Municipal Bonds 64,669 — ( 11,554 ) 53,115 MBS 368,081 31 ( 31,942 ) 336,170 Total AFS Securities $ 584,287 $ 1,162 $ ( 47,809 ) $ 537,640 Student Loan Pools are typically 97% guaranteed by the United States government while SBA bonds are 100% backed by the full faith and credit of the United States government. The majority of the Ba

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements The amortized cost and fair value of AFS securities pledged as collateral for certain deposit accounts, FHLB advances, FRB, a nd other borrowings were $ 502.4 million and $ 461.2 million at June 30, 2024 , and $ 533.7 million and $ 490.5 million at December 31, 2023 , respectively. There were no sales of AFS securities during the six months ended June 30, 2024 and 2023 ; and therefore, no proceeds from sales, gross gains or gross losses were recorded during those periods. The following tables summarize gross unrealized losses and the related fair value, aggregated by investment category and length of time that individual AFS securities have been in a continuous unrealized loss position at the dates indicated. June 30, 2024 Less than 12 Months 12 Months or More Total Dollars in thousands Fair Value Unrealized Losses # Fair Value Unrealized Losses # Fair Value Unrealized Losses Student Loan Pools $ 7,912 $ ( 14 ) 6 $ 29,563 $ ( 237 ) 26 $ 37,475 $ ( 251 ) SBA Bonds 2,625 ( 27 ) 3 30,953 ( 2,609 ) 53 33,578 ( 2,636 ) Tax Exempt Municipal Bonds 547 ( 8 ) 1 12,709 ( 1,054 ) 12 13,256 ( 1,062 ) Taxable Municipal Bonds — — — 52,585 ( 11,986 ) 59 52,585 ( 11,986 ) MBS 30,110 ( 207 ) 22 287,146 ( 29,762 ) 217 317,256 ( 29,969 ) $ 41,194 $ ( 256 ) 32 $ 412,956 $ ( 45,648 ) 367 $ 454,150 $ ( 45,904 ) December 31, 2023 Less than 12 Months 12 Months or More Total Dollars in thousands Fair Value Unrealized Losses # Fair Value Unrealized Losses # Fair Value Unrealized Losses Student Loan Pools $ 377 $ ( 1 ) 1 $ 43,872 $ ( 727 ) 34 $ 44,249 $ ( 728 ) SBA Bonds 2,200 ( 5 ) 4 39,151 ( 2,672 ) 63 41,351 ( 2,677 ) Tax Exempt Municipal Bonds — — — 12,965 ( 908 ) 12 12,965 ( 908 ) Taxable Municipal Bonds — — — 53,115 ( 11,554 ) 59 53,115 ( 11,554 ) MBS 36,069 ( 434 ) 30 292,864 ( 31,508 ) 213 328,933 ( 31,942 ) $ 38,646 $ ( 440 ) 35 $ 441,967 $ ( 47,369 ) 381 $ 480,613 $

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