Security Federal Corporation Announces Third Quarter Earnings
Tuesday, November 1st, 2022
Security Federal Corporation, the holding company for Security Federal Bank, today announced earnings and financial results for the three and nine months ended September 30, 2022.
Net income was $3.2 million, or $0.99 per common share, for the quarter ended September 30, 2022 compared to $4.6 million, or $1.43 per common share, for the same quarter last year. Year to date net income was $6.9 million, or $2.13 per common share, for the nine months ended September 30, 2022 compared to $10.7 million, or $3.30 per common share, during the nine months ended September 30, 2021. The decrease in net income was primarily due to the release of $2.3 million in loan loss reserves during the first nine months of 2021 following significantly higher loan loss provisions during 2020 in response to the potential and unknown economic impact of the ongoing COVID-19 pandemic. Decreases in gain on sale of loans and grant income combined with an increase in non-interest expense also contributed to lower net income during the nine months ended September 30, 2022 when compared to the same period last year.
On May 24, 2022, the Company entered into a Letter Agreement with the U.S. Department of Treasury under the Emergency Capital Investment Program (“ECIP”). Established by the Consolidated Appropriations Act, 2021, the ECIP was created to encourage low- and moderate-income community financial institutions and minority depository institutions to provide loans, grants, and forbearance for small businesses, minority-owned businesses, and consumers, especially low-income and underserved communities, including persistent poverty counties, that may be disproportionately impacted by the economic effect of the COVID-19 pandemic by providing direct and indirect capital investments in low- and moderate-income community financial institutions. Pursuant to the Agreement, the Company agreed to issue and sell 82,949 shares of the Company’s Preferred Stock as Senior Non-Cumulative Perpetual Preferred Stock, Series ECIP (the “Preferred Stock”) for an aggregate purchase price of $82.9 million in cash.