Security Federal Corporation Announces Increase In Third Quarter Earnings
Security Federal Corporation (“Company”) (OTCBB:SFDL.OB), the holding company of Security Federal Bank (“Bank”), today announced earnings for the third quarter of its fiscal year ending March 31, 2011. The Company reported net income available to common shareholders of $344,000 or $0.12 per common share (basic) for the three months ended December 31, 2010, an increase of $24,000 or 7.50% when compared to net income of $320,000 or $0.13 per common share (basic) for the three months ended December 31, 2009. For the nine months ended December 31, 2010, net income available to common shareholders increased $90,000 or 11.44% to $877,000 or $0.34 per common share (basic) compared to $787,000 or $0.32 per common share (basic) for the nine months ended December 31, 2009.
The increases in earnings for the three and the nine month periods are primarily a result of an increase in other income and a decrease in preferred stock dividends. These factors were offset slightly by a decrease in net interest income.
Non-interest income for the current quarter was $1.74 million, an increase of $316,000 or 22.13% compared to $1.43 million for the same quarter in 2009. For the nine months ended December 31, 2010, non-interest income was $4.99 million, an increase of $820,000 or 19.66% compared to $4.17 million for the same period in the prior year. The increase in both periods was primarily the result of increases in the gain on sale of investments and also mortgage loans. General and administrative expenses increased $330,000 or 5.99% to $5.84 million for the three months ended December 31, 2010 and $475,000 or 2.87% to $17.05 million for the nine months ended December 31, 2010 compared to $5.51 million and $16.58 million, respectively, for the same periods in the previous year.
As previously reported, the Company completed a successful capital raise during the quarter. On December 22, 2010 the Company sold 82,906 shares of its common stock through a private placement. This was the final phase in a successful plan to raise capital that began in the quarter ended September 30, 2010. As the Company previously reported on September 29, 2010, it completed a $4.0 million private placement of its common stock simultaneously with the exchange of $18.0 million of its Series A Preferred Stock paying 5% for $22.0 million of Series B preferred stock paying 2%, an exchange that was available through the Company’s participation in the Community Development Capital Initiative (“CDCI”). As a result of this exchange, preferred stock dividends decreased $132,000 or 54.55% to $110,000 for the three months ended December 31, 2010 compared to $242,000 for the same quarter in 2009. For the nine months ended December 31, 2010, preferred stock dividends decreased $154,000 or 21.12% to $575,000 compared to $729,000 for the same period in the previous year.
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