SOUND FINANCIAL BANCORP, INC., 10-K filed on 3/14/2023
Annual Report
v3.22.4
Cover - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Mar. 10, 2023
Jun. 30, 2022
Cover [Abstract]      
Document Type 10-K    
Document Annual Report true    
Document Period End Date Dec. 31, 2022    
Current Fiscal Year End Date --12-31    
Document Transition Report false    
Entity File Number 001-35633    
Entity Registrant Name Sound Financial Bancorp, Inc.    
Entity Incorporation, State or Country Code MD    
Entity Tax Identification Number 45-5188530    
Entity Address, Address Line One 2400 3rd Avenue,    
Entity Address, Address Line Two Suite 150,    
Entity Address, City or Town Seattle,    
Entity Address, State or Province WA    
Entity Address, Postal Zip Code 98121    
City Area Code 206    
Local Phone Number 448-0884    
Title of 12(b) Security Common Stock, par value $0.01 per share    
Trading Symbol SFBC    
Security Exchange Name NASDAQ    
Entity Well-known Seasoned Issuer No    
Entity Voluntary Filers No    
Entity Current Reporting Status Yes    
Entity Interactive Data Current Yes    
Entity Filer Category Non-accelerated Filer    
Entity Small Business true    
Entity Emerging Growth Company false    
ICFR Auditor Attestation Flag false    
Entity Shell Company false    
Entity Public Float     $ 55.3
Entity Common Stock, Shares Outstanding   2,601,647  
Documents Incorporated by Reference PART III of Form 10-K – Portions of the Registrant's Proxy Statement for its 2023 Annual Meeting of Stockholders. The 2023 Proxy Statement will be filed with the U.S. Securities and Exchange Commission within 120 days after the end of the fiscal year to which this report relates.    
Entity Central Index Key 0001541119    
Document Fiscal Year Focus 2022    
Document Fiscal Period Focus FY    
Amendment Flag false    
v3.22.4
Audit Information
 12 Months Ended
Dec. 31, 2022
Audit Information [Abstract]  
Auditor Name Moss Adams LLP
Auditor Location Everett, Washington
Auditor Firm ID 659
v3.22.4
Consolidated Balance Sheets - USD ($)
$ in Thousands
Dec. 31, 2022
Dec. 31, 2021
ASSETS    
Cash and cash equivalents $ 57,836 $ 183,590
Available-for-sale securities, at fair value 10,207 8,419
Held-to-maturity securities, at amortized cost (fair value of $1,810 at December 31, 2022) 2,199 0
Loans held-for-sale 0 3,094
Total Loans 865,981 686,398
Allowance for loan losses (7,599) (6,306)
Total loans held-for-portfolio, net 858,382 680,092
Accrued interest receivable 3,083 2,217
Bank-owned life insurance ("BOLI"), net 21,314 21,095
Other real estate owned ("OREO") and repossessed assets, net 659 659
Mortgage servicing rights ("MSR"), at fair value 4,687 4,273
Federal Home Loan Bank ("FHLB") stock, at cost 2,832 1,046
Premises and equipment, net 5,513 5,819
Operating lease right of use assets, net 5,102 5,811
Other assets 4,537 3,576
Total assets 976,351 919,691
Deposits    
Interest-bearing 635,567 607,854
Noninterest-bearing demand 173,196 190,466
Total deposits 808,763 798,320
Borrowings 43,000 0
Accrued interest payable 395 200
Operating lease liabilities 5,448 6,242
Other liabilities 8,318 8,571
Advance payments from borrowers for taxes and insurance 1,046 1,366
Subordinated notes, net 11,676 11,634
Total liabilities 878,646 826,333
COMMITMENTS AND CONTINGENCIES (Notes 12 and 18)
STOCKHOLDERS' EQUITY    
Preferred stock, $0.01 par value, 10,000,000 shares authorized, none issued or outstanding 0 0
Common stock, $0.01 par value, 40,000,000 shares authorized, 2,583,619 and 2,613,768 issued and outstanding at December 31, 2022 and 2021, respectively 26 26
Additional paid-in capital 28,004 27,956
Retained earnings 70,792 65,237
Accumulated other comprehensive (loss) income, net of tax (1,117) 139
Total stockholders' equity 97,705 93,358
Total liabilities and stockholders' equity $ 976,351 $ 919,691
v3.22.4
Consolidated Balance Sheets (Parenthetical) - USD ($)
$ in Thousands
Dec. 31, 2022
Dec. 31, 2021
STOCKHOLDERS' EQUITY    
Held-to-maturity securities $ 1,810  
Preferred stock, par value (in dollars per share) $ 0.01 $ 0.01
Preferred stock, shares authorized (in shares) 10,000,000 10,000,000
Preferred stock, shares issued (in shares) 0 0
Preferred stock, shares outstanding (in shares) 0 0
Common stock, par value (in dollars per share) $ 0.01 $ 0.01
Common stock, shares authorized (in shares) 40,000,000 40,000,000
Common stock, shares issued (in shares) 2,583,619 2,613,768
Common stock, shares outstanding (in shares) 2,583,619 2,613,768
v3.22.4
Consolidated Statements of Income - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
INTEREST INCOME    
Loans, including fees $ 38,177 $ 33,389
Interest and dividends on investments, cash and cash equivalents 1,618 485
Total interest income 39,795 33,874
INTEREST EXPENSE    
Deposits 2,950 3,282
Borrowings 878 0
Subordinated notes 672 672
Total interest expense 4,500 3,954
Net interest income 35,295 29,920
PROVISION FOR LOAN LOSSES 1,225 425
Net interest income after provision for loan losses 34,070 29,495
NONINTEREST INCOME    
Service charges and fee income 2,368 2,247
Earnings on cash surrender value of BOLI 219 416
Mortgage servicing income 1,242 1,284
Fair value adjustment on MSRs 207 (808)
Net gain on sale of loans 546 4,190
Total noninterest income 4,582 7,329
NONINTEREST EXPENSE    
Salaries and benefits 16,415 14,257
Operations 5,812 5,765
Regulatory assessments 452 379
Occupancy 1,737 1,748
Data processing 3,360 3,263
Net (gain)/loss and expenses on OREO and repossessed assets 0 (16)
Total noninterest expense 27,776 25,396
Income before provision for income taxes 10,876 11,428
Provision for income taxes 2,072 2,272
Net income $ 8,804 $ 9,156
Earnings per common share:    
Basic (in dollars per share) $ 3.39 $ 3.52
Diluted (in dollars per share) $ 3.35 $ 3.46
Weighted average number of common shares outstanding:    
Basic (in shares) 2,578,496 2,582,775
Diluted (in shares) 2,613,414 2,626,516
v3.22.4
Consolidated Statements of Comprehensive Income - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Statement of Comprehensive Income [Abstract]    
Net income $ 8,804 $ 9,156
Available for sale securities:    
Unrealized losses arising during the year (1,590) (128)
Income tax benefit related to unrealized losses 334 27
Other comprehensive loss, net of tax (1,256) (101)
Comprehensive income $ 7,548 $ 9,055
v3.22.4
Consolidated Statements of Stockholders' Equity - USD ($)
$ in Thousands
Total
Common Stock
Additional Paid-in Capital
Unearned ESOP Shares
Retained Earnings
Accumulated Other Comprehensive Income (Loss), net of tax
Balance, beginning of period (in shares) at Dec. 31, 2020   2,592,587        
Balance, beginning of period at Dec. 31, 2020 $ 85,484 $ 25 $ 27,106 $ (113) $ 58,226 $ 240
Increase (Decrease) in Stockholders' Equity [Roll Forward]            
Net income 9,156       9,156  
Other comprehensive loss, net of tax benefit (101)         (101)
Share-based compensation 360   360      
Restricted stock awards issued (in shares)   10,168        
Cash dividends on common stock $ (2,039)       (2,039)  
Common stock repurchased (in shares) (3,657) (3,657)        
Common stock repurchased $ (152)   (46)   (106)  
Common stock surrendered (in shares)   (4,091)        
Restricted shares forfeited (in shares)   (1,890)        
Common stock options exercised (in shares)   20,651        
Common stock options exercised 182   181      
Allocation of ESOP shares $ 468   355 113    
Balance, end of period (in shares) at Dec. 31, 2021 2,613,768 2,613,768        
Balance, end of period at Dec. 31, 2021 $ 93,358 $ 26 27,956 0 65,237 139
Increase (Decrease) in Stockholders' Equity [Roll Forward]            
Net income 8,804       8,804  
Other comprehensive loss, net of tax benefit (1,256)         (1,256)
Share-based compensation 475   475      
Restricted stock awards issued (in shares)   9,700        
Cash dividends on common stock $ (2,031)       (2,031)  
Common stock repurchased (in shares) (46,799) (46,799)        
Common stock repurchased $ (1,734)   (516)   (1,218)
Common stock surrendered (in shares)   (3,541)        
Common stock surrendered (134)   (134)      
Restricted shares forfeited (in shares)   (930)        
Common stock options exercised (in shares)   11,421        
Common stock options exercised $ 223   223      
Balance, end of period (in shares) at Dec. 31, 2022 2,583,619 2,583,619        
Balance, end of period at Dec. 31, 2022 $ 97,705 $ 26 $ 28,004 $ 0 $ 70,792 $ (1,117)
v3.22.4
Consolidated Statements of Stockholders' Equity (Parenthetical) - $ / shares
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Statement of Stockholders' Equity [Abstract]    
Cash dividends on common stock (in dollars per share) $ 0.78 $ 0.78
v3.22.4
Consolidated Statements of Cash Flows - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
CASH FLOWS FROM OPERATING ACTIVITIES:    
Net income $ 8,804 $ 9,156
Adjustments to reconcile net income to net cash from operating activities:    
Amortization of net discounts on investments 73 134
Provision for loan losses 1,225 425
Depreciation and amortization 704 676
Compensation expense related to stock options and restricted stock 475 360
Fair value adjustment on mortgage servicing rights (207) 808
Right of use assets amortization 895 911
Lease liabilities (980) (892)
Increase in cash surrender value of BOLI (219) (416)
Advances from borrowers for taxes and insurance (320) 198
Deferred income tax (149) (43)
Net gain on sale of loans (546) (4,190)
Proceeds from sale of loans held-for-sale 21,251 150,325
Originations of loans held-for-sale (19,550) (138,926)
Net gain on OREO and repossessed assets 0 (16)
Change in operating assets and liabilities:    
Accrued interest receivable (866) 37
Other assets (478) (202)
Accrued interest payable 195 (169)
Other liabilities (253) 897
Net cash provided by operating activities 10,054 19,073
CASH FLOWS FROM INVESTING ACTIVITIES:    
Purchase of available-for-sale securities (4,380) (1,950)
Proceeds from principal payments, maturities and sales of available-for-sale securities 972 3,529
Purchase of HTM investments (2,226) 0
Proceeds from principal payments, maturities and sales of HTM securities 27 0
FHLB stock purchased (1,786) (169)
Net increase in loans (177,784) (73,238)
Purchase of BOLI 0 (6,091)
Purchases of premises and equipment, net (398) (225)
Proceeds from sale of OREO and other repossessed assets 0 35
Net cash used in investing activities (185,575) (78,109)
CASH FLOWS FROM FINANCING ACTIVITIES:    
Net increase in deposits 10,443 50,339
Proceeds from borrowings 43,000 0
Common stock repurchases (1,734) (152)
Allocation of ESOP shares 0 468
Dividends paid on common stock (2,031) (2,039)
Purchase of stock surrendered to pay tax liability (134) 0
Proceeds from common stock option exercises 223 182
Net cash provided by financing activities 49,767 48,798
Net change in cash and cash equivalents (125,754) (10,238)
Cash and cash equivalents, beginning of period 183,590 193,828
Cash and cash equivalents, end of period 57,836 183,590
SUPPLEMENTAL CASH FLOW INFORMATION:    
Cash paid for income taxes 2,010 2,895
Interest paid on deposits, borrowings and subordinated debt 4,305 4,123
Loans transferred from loans held-for-portfolio to OREO and repossessed assets 0 84
ROU assets obtained in exchange for new operating lease liabilities $ 186 $ 0
v3.22.4
Organization and Significant Accounting Policies
 12 Months Ended
Dec. 31, 2022
Accounting Policies [Abstract]  
Organization and Significant Accounting Policies Organization and Significant Accounting Policies
Sound Financial Bancorp, a Maryland corporation (“Sound Financial Bancorp”), is the parent holding company for its wholly owned subsidiary, Sound Community Bank (the “Bank”) and the Bank's wholly-owned subsidiary, Sound Community Insurance Agency, Inc. Substantially all of Sound Financial Bancorp's business is conducted through Sound Community Bank, a Washington state-chartered commercial bank. As a Washington commercial bank that is not a member of the Federal Reserve System, the Bank's regulators are the Washington State Department of Financial Institutions (“WDFI”) and the Federal Deposit Insurance Corporation (“FDIC”). As a bank holding company, Sound Financial Bancorp is regulated by the Board of Governors of the Federal Reserve System ("Federal Reserve"). Sound Financial Bancorp’s business activities generally are limited to passive investment activities and oversight of its investment in the Bank. Accordingly, the information set forth in this report relates primarily to the Bank. References to the “Company,” “we,” “us,” and “our” mean Sound Financial Bancorp and the Bank unless the context otherwise requires.
Subsequent events – The Company has evaluated subsequent events for potential recognition and disclosure. See “Note 21—Subsequent Events” for further information.
Basis of Presentation and Use of Estimates – The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the allowance for loan losses, the fair value of MSRs, valuations of impaired loans and OREO, and the realization of deferred taxes.
The accompanying consolidated financial statements include the accounts of Sound Financial Bancorp and its wholly-owned subsidiaries, Sound Community Bank and Sound Community Insurance Agency, Inc. All significant intercompany balances and transactions between Sound Financial Bancorp and its subsidiaries have been eliminated in consolidation.
Cash and cash equivalents – For purposes of reporting cash flows, cash and cash equivalents include cash on hand and in banks and interest-bearing deposits. All have original maturities of three months or less and may exceed federally insured limits.
Investment securities – Investment securities are classified as either held-to-maturity (“HTM”) or available-for-sale (“AFS”). Securities classified as HTM are those that the Company has the positive intent and ability to hold until maturity. These securities are carried at amortized cost, adjusted for the amortization or accretion of premiums or discounts. Securities not classified as HTM or trading are considered AFS securities. AFS securities may be sold to implement the Company's asset/liability management strategies and/or in response to changes in interest rates and similar factors. AFS securities are reported at fair value. Dividend and interest income on investment securities are recognized when earned.
Unrealized gains and losses, net of the related deferred tax effect, are reported as a net amount in accumulated other comprehensive income (loss) on AFS securities in the consolidated balance sheets. Realized gains and losses on AFS securities, determined using the specific identification method, are included in earnings. Amortization of premiums and accretion of discounts are recognized as adjustments to interest income using the interest method over the period to the earlier of call date or maturity.
The Company reviews investment securities on an ongoing basis for the presence of other-than-temporary impairment (“OTTI”) or permanent impairment, taking into consideration current market conditions, fair value in relation to cost, extent and nature of the change in fair value, issuer rating changes and trends, whether the Company intends to sell a security or if it is likely that the Company will be required to sell the security before recovery of its amortized cost basis of the investment, which may be maturity, and other factors. For debt securities, if the Company intends to sell the security or it is likely that it will be required to sell the security before recovering its cost basis, the entire impairment loss would be recognized in earnings as an OTTI. If the Company does not intend to sell the security and it is not likely that we will be required to sell the security but we do not expect to recover the entire amortized cost basis of the security, only the portion of the impairment loss representing credit losses would be recognized in earnings. The credit loss on a security is measured as the difference between the amortized cost basis and the present value of the cash flows expected to be collected. Projected cash flows are discounted by the original or current effective interest rate depending on the nature of the security being measured for potential OTTI.
The remaining impairment related to all other factors, the difference between the present value of the cash flows expected to be collected and the fair value, is recognized as a charge to other comprehensive income. The Company does not intend to sell these securities and it is more likely than not that it will not be required to sell the securities before anticipated recovery of the remaining amortized cost basis. The Company closely monitors its investment securities for changes in credit risk.
Loans held-for-sale – To mitigate interest-rate sensitivity, from time to time, certain fixed-rate mortgage loans are identified as held-for-sale in the secondary market. Accordingly, such loans are classified as held-for-sale in the consolidated balance sheets and are carried at the lower of cost or estimated fair market value in the aggregate. Net unrealized losses, if any, are recognized through a valuation allowance by charges to income. Mortgage loans held-for-sale are generally sold with the mortgage servicing rights retained by the Company. Gains or losses on sales of loans are recognized based on the difference between the selling price and the carrying value of the related loans sold based on the specific identification method.
Loans held-for-portfolio – The Company originates mortgage, commercial, and consumer loans to clients. A substantial portion of the loan portfolio is represented by loans secured by real estate located throughout the Puget Sound region, especially King, Snohomish and Pierce Counties, and in Clallam and Jefferson Counties of Washington State. The ability of the Company's debtors to honor their contracts is dependent upon employment, real estate and general economic conditions in these areas.
Loans that management has the intent and ability to hold for the foreseeable future or until maturity or pay-off generally are reported at their outstanding unpaid principal balance adjusted for any charge-offs, allowance for loan losses, and any deferred fees or costs on origination of loans. Interest income is accrued on the unpaid principal balance. Loan origination fees, net of certain direct origination costs, are deferred and recognized as an adjustment of the related loan yield using the interest method over the contractual life of the loan for term loans or the straight-line method for open-ended loans.
The accrual of interest is discontinued at the time the loan is 90 days past due or if, in management's opinion, the borrower may be unable to meet payment of obligations as they become due, as well as when required by regulatory provisions. Loans are typically charged off no later than 120 days past due, unless secured by collateral. Past due status is based on contractual terms of the loan. In all cases, loans are placed on nonaccrual or charged off at an earlier date if collection of principal or interest is considered doubtful.
All interest accrued but not collected for loans that are placed on nonaccrual or charged-off is reversed against interest income. The interest on these loans is accounted for on the cash-basis or cost-recovery method, until qualifying for return to accrual. Loans are returned to accrual status when all of the principal and interest amounts contractually due are brought current, future payments are reasonably assured and payments have been received for six consecutive months.
A loan is considered impaired when it is probable that the Company will be unable to collect all amounts (principal and interest) due according to the contractual terms of the original loan agreement. When a loan has been identified as being impaired, the amount of the impairment is measured by using discounted cash flows, except when, as a practical expedient, the current fair value of the collateral, reduced by costs to sell, is used. When the measurement of the impaired loan is less than the recorded investment in the loan (including accrued interest), impairment is recognized by charging off the impaired portion or creating or adjusting a specific allocation of the allowance for loan losses. The Company recognizes interest income on impaired loans, including cash receipts, based on its existing methods of recognizing interest income on nonaccrual loans.
A loan is classified as a troubled debt restructuring ("TDR") when certain concessions have been made to the contractual terms, such as reductions of interest rates or deferrals of interest or principal payments due to the borrower's deteriorated financial condition. All TDRs are reported and accounted for as impaired loans.
Allowance for loan losses – The allowance for loan losses is a reserve established through a provision for loan losses charged to expense and represents management's best estimate of probable incurred losses within the existing loan portfolio as of the balance sheet date. The level of the allowance reflects management's view of trends in loan loss activity, current loan portfolio quality and present economic, political and regulatory conditions. Portions of the allowance may be allocated for specific loans; however, the allowance is available for any loan that is charged off. The allowance is increased by provisions charged to earnings and by recoveries of amounts previously charged off, and is reduced by charge-offs on loans (or portions thereof) deemed to be uncollectible. Loan charge-offs are recognized when management believes the collectability of the principal balance outstanding is unlikely. Full or partial charge-offs on collateral dependent impaired loans are generally recognized when the collateral is deemed to be insufficient to support the carrying value of the loan.
The allowance for loan losses is maintained at a level sufficient to provide for probable credit losses based upon evaluating known and inherent risks in the loan portfolio. The allowance is provided based upon management's continuing analysis of the pertinent factors underlying the quality of the loan portfolio. These factors include changes in the size and composition of the loan portfolio, delinquency levels, actual loan loss experience, current economic conditions, and detailed analysis of individual loans for which full collectability may not be assured. The detailed analysis includes techniques to estimate the fair value of
loan collateral and the existence of potential alternative sources of repayment. The allowance consists of specific, general and unallocated components.
The general component of the allowance for loan losses covers non-impaired loans and is determined using a formula-based approach. The formula first incorporates either the historical loss rates of the Company or the historical loss rates of its peer group if minimal loss history exists. This historical loss rate factor is then adjusted for qualitative factors. Qualitative factors are used to estimate losses related to factors that are not captured in the historical loss rates and are based on management’s evaluation of available internal and external data and involve significant management judgement. Qualitative factors include changes in lending standards, changes in economic conditions, changes in the nature and volume of loans, changes in lending management, changes in delinquencies, changes in the loan review system, changes in the value of collateral, the existence of concentrations, and the impact of other external factors. Finally, the general component of the allowance for loan losses is adjusted for changes in the assigned grades of loans, which include the following: pass, watch, special mention, substandard, doubtful, and loss. As loans are downgraded from watch to the lower categories, they are assigned an additional factor to account for the increased credit risk. Loan grades involve significant management judgment.
For such loans that are also classified as impaired, a specific component within the allowance is established when the discounted cash flows (or collateral value or observable market price) of the impaired loan are lower than the carrying value of that loan.
An unallocated component is maintained to cover uncertainties that could affect management's estimate of probable losses. The unallocated component of the allowance reflects the margin of imprecision inherent in the underlying assumptions used in the methodologies for estimating specific and general losses in the portfolio.
The Company considers installment loans to be pools of smaller balance, homogenous loans that are collectively evaluated for impairment, unless such loans are subject to a TDR agreement.
The appropriateness of the allowance for loan losses is estimated based upon those factors and trends identified by management at the time consolidated financial statements are prepared. When available information confirms that specific loans or portions thereof are uncollectible, identified amounts are charged against the allowance for loan losses.
The existence of some or all of the following criteria will generally confirm that a loss has been incurred: the loan is significantly delinquent and the borrower has not demonstrated the ability or intent to bring the loan current; the Company has no recourse to the borrower, or if it does, the borrower has insufficient assets to pay the debt; the estimated fair value of the loan collateral is significantly below the current loan balance, and there is little or no near-term prospect for improvement.
The ultimate recovery of all loans is susceptible to future market factors beyond the Company's control. These factors may result in losses or recoveries differing significantly from those provided in the consolidated financial statements.
Transfers of financial assets – Transfers of an entire financial asset, or a participating interest in an entire financial asset, are accounted for as sales when control over the assets has been surrendered. Control over transferred assets is deemed to be surrendered when: (1) a group of financial assets or a participating interest in an entire financial asset has been isolated from the Company, (2) the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets, and (3) the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity.
Mortgage servicing rights – MSRs represent the value associated with servicing residential mortgage loans, when the mortgage loans have been sold into the secondary market and the related servicing has been retained by the Company. The Company may also purchase MSRs. The value is determined through a discounted cash flow analysis, which uses interest rates, prepayment speeds and delinquency rate assumptions as inputs. All of these assumptions require a significant degree of management judgment. The Company measures its mortgage servicing assets at fair value and reports changes in fair value through earnings under the caption fair value adjustment on MSRs in other income in the period in which the change occurs. The fair values of servicing rights are subject to significant fluctuations as a result of changes in estimates and actual prepayment speeds and default rates and losses. Currently, we do not hedge the effects of changes in fair value of our servicing assets.
Premises and equipment – Premises, leasehold improvements and furniture and equipment are carried at cost, less accumulated depreciation and amortization. Furniture and equipment are depreciated using the straight-line method over the estimated useful lives of the assets, which range from 1 to 10 years. The cost of leasehold improvements is amortized using the straight-line method over the terms of the related leases. The cost of premises is amortized using the straight-line method over the estimated useful life of the building, up to 39 years. Management reviews premises, leasehold improvements and furniture and equipment for impairment when factors exist indicating potential impairment.
Bank-owned life insurance, net – The carrying amount of BOLI approximates its fair value, and is estimated using the cash surrender value, net of any surrender charges.
Federal Home Loan Bank stock – The Company is a member of the FHLB of Des Moines. FHLB stock represents the Company's investment in the FHLB and is carried at par value, which reasonably approximates its fair value. As a member of the FHLB, the Company is required to maintain a minimum level of investment in FHLB stock based on specific percentages of its outstanding mortgages, total assets, or FHLB advances. At December 31, 2022 and 2021, the Company's minimum required investment in FHLB stock was $2.8 million and $1.0 million, respectively. Typically, the Company may request redemption at par value of any stock in excess of the minimum required investment. Stock redemptions are at the discretion of the FHLB.
Other real estate owned and repossessed assets – OREO and repossessed assets represent real estate and other assets which the Company has taken control of in partial or full satisfaction of loans. At the time of foreclosure, OREO and repossessed assets are recorded at fair value less estimated costs to sell, which becomes the new basis. Any write-downs based on the asset's fair value at the date of acquisition are charged to the allowance for loan and lease losses. After foreclosure, management periodically performs valuations such that the property is carried at the lower of its new cost basis or fair value, net of estimated costs to sell. Revenue and expenses from operations and subsequent adjustments to the carrying amount of the property are included in other noninterest expense in the consolidated statements of income.
In some instances, the Company may make loans to facilitate the sales of OREO. Management reviews all sales for which it is the lending institution. Any gains related to sales of other real estate owned may be deferred until the buyer has a sufficient investment in the property.
Leases – We determine if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use assets and operating lease liabilities in our consolidated balance sheets. Right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease right-of-use assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, we generally use our incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. The operating lease right-of-use asset also includes any lease payments made and excludes lease incentives. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. Additionally, for equipment leases, we apply a portfolio approach to effectively account for the operating lease right-of-use assets and liabilities. The Company has not entered into leases that meet the definition of a financing lease.
Income Taxes – Income taxes are accounted for using the asset and liability method. Under this method a deferred tax asset or liability is determined based on the enacted tax rates which will be in effect when the differences between the financial statement carrying amounts and tax basis of existing assets and liabilities are expected to be reported in the Company's income tax returns. The effect on deferred taxes of a change in tax rates is recognized in income in the period that includes the enactment date. Valuation allowances are established to reduce the net carrying amount of deferred tax assets if it is determined to be more likely than not, that all or some portion of the potential deferred tax asset will not be realized.
Segment reporting – The Company operates in one segment and makes management decisions based on consolidated results. The Company's operations are solely in the financial services industry and include providing to its clients traditional banking and other financial services.
Off-balance-sheet credit-related financial instruments – In the normal course of operations, the Company engages in a variety of financial transactions that are not recorded in our financial statements. These transactions involve varying degrees of off-balance sheet credit, interest rate and liquidity risks. These transactions are used primarily to manage customers' requests for funding and take the form of loan commitments, letters of credit and lines of credit. Such financial instruments are recorded when they are funded. The Company also maintains a separate allowance for off-balance sheet credit commitments. Management estimates anticipated losses using historical data and utilization assumptions. The allowance for off-balance sheet credit commitments totaled $336 thousand and $405 thousand at December 31, 2022 and 2021, respectively, and is included in other liabilities on the consolidated balance sheets.
Advertising costs – The Company expenses advertising costs as they are incurred. Advertising costs, including other marketing expenses were $390 thousand and $415 thousand for the years ended December 31, 2022 and 2021, respectively.
Comprehensive income – Accounting principles generally require that recognized revenue, expenses, gains, and losses be included in net income. Certain changes in assets and liabilities, such as unrealized gains and losses on available-for-sale investments, are reported as a separate component of the equity section of the consolidated balance sheets, net of tax. Such items, along with net income, are components of comprehensive income.
Intangible assets – At December 31, 2022 and 2021, the Company had $67 thousand and $97 thousand, respectively, of identifiable intangible assets included in other assets as a result of the acquisition of deposits from other institutions. These assets are amortized using the straight-line method over a period of eight to ten years and have a remaining weighted average life of 2.3 years. Management reviews intangible assets for impairment on an annual basis, or whenever events occur or circumstances change indicating the carrying amount of the intangible asset may not be recoverable. No impairment losses have been recognized in the periods presented.
Employee stock ownership plan – The Company sponsors an internally-leveraged ESOP. As shares are committed to be released, compensation expense is recorded equal to the market price of the shares, and the shares become outstanding for purposes of earnings per share calculations. Cash dividends on allocated shares (those credited to ESOP participants' accounts) are recorded as a reduction of stockholders' equity and distributed directly to participants' accounts. Cash dividends on unallocated shares (those held by the ESOP not yet credited to participants' accounts) are used to pay administrative expenses and debt service requirements of the ESOP. See "Note 14—Employee Benefits" for further information.
Unearned ESOP shares are shown as a reduction of stockholders' equity. When the shares are released, unearned common shares held by the ESOP are reduced by the cost of the ESOP shares released and the differential between the fair value and the cost is charged to additional paid in capital. The loan receivable from the ESOP to the Company is not reported as an asset nor is the debt of the ESOP reported as a liability on the Company's consolidated statements of condition.
Earnings Per Common Share – Earnings per share is computed using the two-class method. Basic earnings per share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding during the period, excluding any participating securities. Participating securities include unvested restricted shares. Unvested restricted shares are considered participating securities because holders of these securities receive non-forfeitable dividends at the same rate as the holders of the Company's common stock. Diluted earnings per share is computed by dividing net income available to common stockholders adjusted for reallocation of undistributed earnings of unvested restricted shares by the weighted average number of common shares determined for the basic earnings per share plus the dilutive effect of common stock equivalents using the treasury stock method based on the average market price for the period. Some stock options are anti-dilutive and therefore are not included in the calculation of diluted earnings per share.
Fair value – Fair value is the price that would be received when an asset is sold or a liability is transferred in an orderly transaction between market participants at the measurement date.
Fair values of the Company's financial instruments are based on the fair value hierarchy which requires an entity to maximize the use of observable inputs, typically market data obtained from third parties, and minimize the use of unobservable inputs, which reflects its estimates for market assumptions, when measuring fair value.
Three levels of valuation inputs are ranked in accordance with the prescribed fair value hierarchy as follows:
Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets.
Level 2: Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active.
Level 3: Assets or liabilities whose significant value drivers are unobservable.
In determining the appropriate levels, the Company performs a detailed analysis of the assets and liabilities that are subject to fair value measurements. In certain cases, the inputs used to measure fair value of an asset or liability may fall into different levels of the fair value hierarchy. The level within which the fair value measurement is categorized is based on the lowest level unobservable input that is significant to the fair value measurement in its entirety. Therefore, an item may be classified in Level 3 even though there may be some significant inputs that are readily observable.
Share-Based Compensation – The Company measures the cost of employee services received in exchange for an award of equity instruments based on the grant date fair value of the award. These costs are recognized on a straight-line basis over the vesting period during which an employee is required to provide services in exchange for the award, also known as the requisite service period. The Company uses the Black-Scholes option pricing model to estimate the fair value of stock options granted. When determining the estimated fair value of stock options granted, the Company utilizes various assumptions regarding the expected volatility of the stock price, the risk-free interest rate for periods within the contractual life of the stock option, and the expected dividend yield that the Company expects over the expected life of the options granted. Reductions in compensation expense associated with forfeited options are expensed based on actual forfeiture experience. The Company measures the fair value of the restricted stock using the closing market price of the Company's common stock on the date of grant. The Company expenses the grant date fair value of the Company's stock options and restricted stock with a corresponding increase in equity. When shares are required to be issued under share-based awards, it is typically the Company’s policy to issue new shares of stock.
Reclassifications – Certain amounts reported in prior years consolidated financial statements may be reclassified to conform to the current presentation. The results of the reclassifications are typically not considered material and have no effect on previously reported net income, earnings per share or stockholders' equity. There were no reclassifications to prior year amounts in the current year.
v3.22.4
Accounting Pronouncements Recently Issued or Adopted
 12 Months Ended
Dec. 31, 2022
Accounting Standards Update and Change in Accounting Principle [Abstract]  
Accounting Pronouncements Recently Issued or Adopted Accounting Pronouncements Recently Issued or Adopted
On March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2020-04, "Reference Rate Reform" ("Topic 848"). This ASU provides optional guidance for a limited period of time to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting. The amendments in this update apply to modifications to eligible contracts (e.g., loans, debt securities, derivatives, borrowings) that replace a reference rate affected by reference rate reform (including rates referenced in fallback provisions) and contemporaneous modifications of other contract terms related to the replacement of the reference rate (including contract modifications to add or change fallback provisions). The following optional expedients for applying the requirements of certain Topics or Industry Subtopics in the Codification are permitted for contracts that are modified because of reference rate reform and that meet certain scope guidance: 1) Modifications of contracts within the scope of Topics 310, Receivables, and 470, Debt, should be accounted for by prospectively adjusting the effective interest rate; 2) Modifications of contracts within the scope of Topics 840, Leases, and 842, Leases, should be accounted for as a continuation of the existing contracts with no reassessments of the lease classification and the discount rate (for example, the incremental borrowing rate) or remeasurements of lease payments that otherwise would be required under those Topics for modifications not accounted for as separate contracts; and 3) Modifications of contracts do not require an entity to reassess its original conclusion about whether that contract contains an embedded derivative that is clearly and closely related to the economic characteristics and risks of the host contract under Subtopic 815-15, Derivatives and Hedging— Embedded Derivatives. In January 2021, ASU 2021-01 updated amendments in the new ASU to clarify that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition. The ASU also amends the expedients and exceptions in Topic 848 to capture the incremental consequences of the scope clarification. The amendments in this ASU have differing effective dates, beginning with interim period including and subsequent to March 12, 2020 through December 31, 2022. The Company does not expect the adoption of ASU 2020-04 to have a material impact on its consolidated financial statements.
In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments and subsequent amendments to the initial guidance in November 2018, ASU No. 2018-19, April 2019, ASU 2019-04, May 2019, ASU 2019-05, November 2019, ASU 2019-11, February 2020, ASU 2020-02, and March 2020, ASU 2020-03, all of which clarifies codification and corrects unintended application of the guidance. This ASU replaces the existing incurred loss impairment methodology that recognizes credit losses when a probable loss has been incurred with new methodology where loss estimates are based upon lifetime expected credit losses. The amendments in this ASU require a financial asset that is measured at amortized cost to be presented at the net amount expected to be collected. The income statement would then reflect the measurement of credit losses for newly recognized financial assets as well as changes to the expected credit losses that have taken place during the reporting period. Financial assets that this guidance will apply to include loans receivable, held-to-maturity debt securities, unfunded loan commitments, and certain other financial assets measured at amortized cost. Under this ASU, available-for-sale debt securities are evaluated for impairment if fair value is less than amortized cost, with any estimated credit losses recorded through a credit loss expense and an allowance, rather than a write-down of the investment. Changes in fair value that are not credit-related will continue to be recorded in other comprehensive income. The change in allowance recognized as a result of adoption will occur using a modified retrospective approach through a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the ASU is adopted. The FASB issued ASU No. 2019-10, Financial Instruments - Credit Losses (Topic 326), delaying implementation of ASU No. 2016-13 for SEC smaller reporting company filers until fiscal years beginning after December 15, 2022. The Company meets the requirements of a smaller reporting company and delayed implementation of ASU No. 2016-13. This guidance became effective on January 1, 2023. The Company currently intends to phase the impact of Topic 326 into regulatory capital over three years in accordance with a final ruling effective April 2019 adopted by the Federal Reserve and other U.S. banking agencies.
In March 2022, the FASB issued ASU 2022-02, Financial Instruments - Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures. The ASU eliminates the accounting guidance for troubled debt restructured loans (“TDRs”) by creditors while enhancing disclosure requirements for certain loan refinancings and restructurings by creditors when a borrower is experiencing financial difficulty. Additionally, the ASU requires public business entities to disclose current-period gross write-offs by year of origination for financing receivables and net investments in leases. This ASU will be effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years, upon the Company’s adoption of the amendments in ASU 2016-13, which is commonly referred to as the current expected credit loss methodology. The Company adopted this standard on January 1, 2023.
v3.22.4
Restricted Cash
 12 Months Ended
Dec. 31, 2022
Cash and Cash Equivalents [Abstract]  
Restricted Cash Restricted CashFederal Reserve System ("Federal Reserve") regulations previously required that the Company maintain certain minimum reserve balances either as cash on hand or on deposit with the Federal Reserve Bank, based on a percentage of deposits. In March 2020, the Federal Reserve announced that it would be reducing the reserve requirement for all depository institutions to zero percent effective March 26, 2020; therefore, there was no reserve requirement at December 31, 2022 and 2021.
v3.22.4
Investments
 12 Months Ended
Dec. 31, 2022
Investments, Debt and Equity Securities [Abstract]  
Investments Investments
The amortized cost and fair value of available-for-sale securities and the corresponding amounts of gross unrealized gains and losses at December 31, 2022 and 2021 were as follows (in thousands):
 Amortized
Cost		Gross
Unrealized Gains		Gross
Unrealized Losses		Estimated
Fair Value
December 31, 2022    
Treasury bills$1,596 $— $(2)$1,594 
Municipal bonds6,434 16 (1,029)5,421 
Agency mortgage-backed securities3,591 1 (400)3,192 
Total available-for-sale securities$11,621 $17 $(1,431)$10,207 
December 31, 2021
Municipal bonds$5,931 $148 $(13)$6,066 
Agency mortgage-backed securities2,312 53 (12)2,353 
Total available-for-sale securities$8,243 $201 $(25)$8,419 
The amortized cost and fair value of our HTM securities and the corresponding amounts of gross unrealized gains and losses at December 31, 2022 are shown in the table below (in thousands). There were no HTM securities at December 31, 2021.
 Amortized
Cost		Gross
Unrealized
Gains		Gross
Unrealized
Losses		Estimated
Fair Value
December 31, 2022
Municipal bonds$705 $— $(169)$536 
Agency mortgage-backed securities1,494 — (219)1,274 
Total$2,199 $— $(388)$1,810 
The amortized cost and fair value of AFS and HTM securities at December 31, 2022, by contractual maturity, are shown below (in thousands). Expected maturities of AFS securities may differ from contractual maturities because borrowers may have the
right to call or prepay obligations with or without call or prepayment penalties. Investments not due at a single maturity date, primarily mortgage-backed investments, are shown separately.
 December 31, 2022
Available-for-saleHeld-to-maturity
 Amortized
Cost		Fair
Value		Weighted-Average YieldAmortized
Cost		Fair
Value		Weighted-Average Yield
Due within one year$1,596 $1,594 2.86 %$— $— — %
Due in one to five years151 151 3.57 — — — 
Due after five to ten years1,226 1,235 5.26 — — — 
Due after ten years5,057 4,035 2.73 705 536 3.04 
Mortgage-backed securities3,591 3,192 3.07 1,494 1,274 2.51 
Total$11,621 $10,207 3.14 %$2,199 $1,810 2.68 %
There were no pledged securities at December 31, 2022 and 2021. There were no sales of AFS securities during the years ended December 31, 2022 and 2021. There were no sales of HTM securities during the years ended December 31, 2022 and 2021.
The following tables summarize the aggregate fair value and gross unrealized loss by length of time of those investments that have been in a continuous unrealized loss position at December 31, 2022 and 2021 (in thousands).
 December 31, 2022
 Less Than 12 Months12 Months or LongerTotal
 Fair
Value		Unrealized
Loss		Fair
Value		Unrealized
Loss		Fair
Value		Unrealized
Loss
Available-for-sale securities
Treasury bills$1,594 $(2)$— $— $1,594 $(2)
Municipal bonds2,506 (641)1,246 (388)3,752 (1,029)
Agency mortgage-backed securities2,666 (314)292 (86)2,958 (400)
Total available-for-sale securities$6,766 $(957)$1,538 $(474)$8,304 $(1,431)
Held-to-maturity securities
Municipal bonds$536 $(169)$— $— $536 $(169)
Agency mortgage-backed securities1,274 (219)— — 1,274 (219)
Total held-to-maturity securities$1,810 $(388)$— $— $1,810 $(388)
 December 31, 2021
 Less Than 12 Months12 Months or LongerTotal
 Fair
Value		Unrealized
Loss		Fair
Value		Unrealized
Loss		Fair
Value		Unrealized
Loss
Municipal bonds$1,632 $(13)$— $— $1,632 $(13)
Agency mortgage-backed securities— — 402 (12)402 (12)
Total$1,632 $(13)$402 $(12)$2,034 $(25)

There were no credit losses recognized in earnings during the years ended December 31, 2022 and 2021 relating to the Company's securities.
At December 31, 2022, the total securities portfolio consisted of one treasury bill security, 11 municipal bonds and 12 agency mortgage-backed securities with a total portfolio fair value of $12.0 million. At December 31, 2021, the securities portfolio consisted of 10 agency mortgage-backed securities and 10 municipal bonds with a fair value of $8.4 million. At December 31, 2022, there were 16 securities in an unrealized loss position for less than 12 months, and three securities in an unrealized loss position for more than 12 months. At December 31, 2021, there were two securities in an unrealized loss position for less than 12 months, and one security in an unrealized loss position for more than 12 months. For both the 2022 and 2021 periods, the
unrealized losses were caused by changes in market interest rates or the widening of market spreads subsequent to the initial purchase of these securities, and not related to the underlying credit of the issuers or the underlying collateral. It is expected that these securities will not be settled at a price less than the amortized cost of each investment. The unrealized losses on these investments are not considered OTTI losses during the years ended December 31, 2022 and 2021, because the decline in fair value is not attributable to credit quality and because we do not intend, and it is not likely that we will be required, to sell these securities before recovery of their amortized cost basis.
v3.22.4
Loans
 12 Months Ended
Dec. 31, 2022
Receivables [Abstract]  
Loans Loans
The composition of the loan portfolio, excluding loans held-for-sale, at December 31, 2022 and 2021 is as follows (in thousands):
December 31,
20222021
Real estate loans:
One-to-four family$274,638 $207,660 
Home equity19,548 13,250 
Commercial and multifamily313,358 278,175 
Construction and land116,878 63,105 
Total real estate loans724,422 562,190 
Consumer loans:
Manufactured homes26,953 21,636 
Floating homes74,443 59,268 
Other consumer17,923 16,748 
Total consumer loans119,319 97,652 
Commercial business loans23,815 28,026 
Total loans867,556 687,868 
Premiums for purchased loans(1)
973 897 
Deferred fees(2,548)(2,367)
Total loans, gross865,981 686,398 
Allowance for loan losses(7,599)(6,306)
Total loans, net$858,382 $680,092 
(1)Includes premiums resulting from purchased loans of $507 thousand related to one-to-four family loans, $320 thousand related to commercial and multifamily loans, and $146 thousand related to commercial business loans as of December 31, 2022. Includes premiums resulting from purchased loans of $556 thousand related to one-to-four family loans, $181 thousand related to commercial and multifamily loans, and $160 thousand related to commercial business loans as of December 31, 2021.

The Company was automatically authorized to participate in the U.S. Small Business Administration (“SBA”) Paycheck Protection Program (“PPP”), as a qualified lender since the inception of the program. As of December 31, 2022, the Bank had funded PPP loans totaling $119.2 million, $17 thousand of which remained outstanding at December 31, 2022 compared to $4.2 million outstanding at December 31, 2021. PPP loans are included in commercial business loans above. PPP loans are 100% guaranteed by the SBA. The PPP ended May 31, 2021.
The Company purchased $2.6 million of commercial business loan participations with United States Department of Agriculture guarantees during the year ended December 31, 2022. During the year ended December 31, 2021, the Company purchased $24.1 million of one-to-four family real estate loans and $4.3 million of commercial business loan participations with United States Department of Agriculture guarantees.
The following table presents the balance in the allowance for loan losses and the unpaid principal balance in loans, net of partial charge-offs by portfolio segment and based on impairment method at December 31, 2022 and 2021 (in thousands):
December 31, 2022
 Allowance: Individually Evaluated for ImpairmentAllowance: Collectively Evaluated for ImpairmentEnding BalanceLoans Held for Investment: Individually Evaluated for ImpairmentLoans Held for Investment: Collectively Evaluated for ImpairmentEnding Balance
One-to-four family$102 $1,669 $1,771 $3,746 $270,892 $274,638 
Home equity5 127 132 210 19,338 19,548 
Commercial and multifamily— 2,501 2,501 — 313,358 313,358 
Construction and land3 1,206 1,209 358 116,520 116,878 
Manufactured homes52 410 462 187 26,766 26,953 
Floating homes— 456 456 — 74,443 74,443 
Other consumer22 302 324 343 17,580 17,923 
Commercial business— 256 256 — 23,815 23,815 
Unallocated— 488 488 — — — 
Total$184 $7,415 $7,599 $4,844 $862,712 $867,556 
December 31, 2021
 Allowance: Individually Evaluated for ImpairmentAllowance: Collectively Evaluated for ImpairmentEnding BalanceLoans Held for Investment: Individually Evaluated for ImpairmentLoans Held for Investment: Collectively Evaluated for ImpairmentEnding Balance
One-to-four family$112 $1,290 $1,402 $4,066 $203,594 $207,660 
Home equity7 86 93 215 13,035 13,250 
Commercial and multifamily— 2,340 2,340 2,380 275,795 278,175 
Construction and land4 646 650 68 63,037 63,105 
Manufactured homes144 331 475 221 21,415 21,636 
Floating homes— 372 372 493 58,775 59,268 
Other consumer26 284 310 106 16,642 16,748 
Commercial business— 269 269 176 27,850 28,026 
Unallocated— 395 395 — — — 
Total$293 $6,013 $6,306 $7,725 $680,143 $687,868 
The following tables summarize the activity in the allowance for loan losses for the years ended December 31, 2022 and 2021 (in thousands):
Year ended December 31, 2022
Beginning
Allowance		Charge-offsRecoveriesProvision/(Recapture)Ending
Allowance
One-to-four family$1,402 $— $99 $270 $1,771 
Home equity93 — 58 (19)132 
Commercial and multifamily2,340 — — 161 2,501 
Construction and land650 — — 559 1,209 
Manufactured homes475 — 12 (25)462 
Floating homes372 — — 84 456 
Other consumer310 (118)17 115 324 
Commercial business269 (6)6 (13)256 
Unallocated395 — — 93 488 
$6,306 $(124)$192 $1,225 $7,599 
Year ended December 31, 2021
 Beginning
Allowance		Charge-offsRecoveriesProvision/(Recapture)Ending
Allowance
One-to-four family$1,063 $(76)$— $415 $1,402 
Home equity147 (8)6 (52)93 
Commercial and multifamily2,370 — — (30)2,340 
Construction and land578 — — 72 650 
Manufactured homes529 (2)3 (55)475 
Floating homes328 — — 44 372 
Other consumer288 (50)6 66 310 
Commercial business291 — 2 (24)269 
Unallocated406 — — (11)395 
 $6,000 $(136)$17 $425 $6,306 
Credit Quality Indicators. Federal regulations provide for the classification of lower quality loans and other assets (such as OREO and repossessed assets), debt and equity securities considered as "substandard," "doubtful" or "loss." An asset is considered "substandard" if it is inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. "Substandard" assets include those characterized by the "distinct possibility" that the insured institution will sustain "some loss" if the deficiencies are not corrected. Assets classified as "doubtful" have all of the weaknesses in those classified "substandard," with the added characteristic that the weaknesses present make "collection or liquidation in full," on the basis of currently existing facts, conditions and values, "highly questionable and improbable." Assets classified as "loss" are those considered "uncollectible" and of such little value that their continuance as assets without the establishment of a specific loss reserve is not warranted.
When the Company classifies problem loans as either substandard or doubtful, it may establish a specific allowance in an amount we deem prudent to address the risk specifically (if the loan is impaired) or it may allow the loss to be addressed in the general allowance (if the loan is not impaired). General allowances represent loss reserves which have been established to recognize the inherent risk associated with lending activities, but which, unlike specific allowances, have not been specifically allocated to particular problem assets. When the Company classifies problem loans as a loss, it charges-off such loans in the period in which they are deemed uncollectible. Assets that do not currently expose the Company to sufficient risk to warrant classification as substandard or doubtful, but possess identified weaknesses are classified as either watch or special mention loans. Determination as to the classification of our assets and the amount of our valuation allowances is subject to review by the FDIC, the Bank's federal regulator, and the WDFI, the Bank's state banking regulator, both of whom can order the establishment of additional loss allowances. Pass rated loans are loans that are not otherwise classified or criticized.
The following tables represent the internally assigned grades at December 31, 2022 and 2021, by type of loan (in thousands):
December 31, 2022
One-to-four
Family		Home
Equity		Commercial
and Multifamily		Construction
and Land		Manufactured
Homes		Floating
Homes		Other
Consumer		Commercial
Business		Total
Grade:
Pass$271,295 $19,230 $291,677 $109,484 $26,583 $74,443 $17,661 $22,853 $833,226 
Watch279 2 7,538 4,037 134 — — 161 12,151 
Special Mention— — 4,096 — — — — — 4,096 
Substandard3,064 316 10,047 3,357 236 — 262 801 18,083 
Total$274,638 $19,548 $313,358 $116,878 $26,953 $74,443 $17,923 $23,815 $867,556 
December 31, 2021
One-to-four
Family		Home
Equity		Commercial
and Multifamily		Construction
and Land		Manufactured
Homes		Floating
Homes		Other
Consumer		Commercial
Business		Total
Grade:
Pass$203,883 $12,904 $233,300 $56,310 $21,137 $58,171 $16,728 $23,713 $626,146 
Watch363 23 32,770 4,347 305 — — 3,561 41,369 
Special Mention— — 4,553 830 — 604 — 211 6,198 
Substandard3,414 323 7,552 1,618 194 493 20 541 14,155 
Total$207,660 $13,250 $278,175 $63,105 $21,636 $59,268 $16,748 $28,026 $687,868 
Nonaccrual and Past Due Loans. Loans are considered past due if the required principal and interest payments have not been received as of the date such payments were due. Loans are placed on nonaccrual once the loan is 90 days past due or sooner if, in management's opinion, the borrower may be unable to meet payment of obligations as they become due, as well as when required by regulatory provisions.
The following table presents the recorded investment in nonaccrual loans at December 31, 2022 and 2021, by type of loan (in thousands):
December 31,
 20222021
One-to-four family$2,135 $2,207 
Home equity142 140 
Commercial and multifamily— 2,380 
Construction and land324 33 
Manufactured homes96 122 
Floating homes— 493 
Other consumer262 — 
Commercial business— 176 
Total$2,959 $5,552 
The following table represents the aging of the recorded investment in past due loans at December 31, 2022, by type of loan (in thousands):
 30-59 Days
Past Due		60-89 Days
Past Due		Greater than 90
Days Past Due		Recorded Investment
> 90 Days and Accruing		Total
Past Due		CurrentTotal
Loans
One-to-four family$393 $289 $1,934 $— $2,616 $272,022 $274,638 
Home equity115 — 116 — 231 19,317 19,548 
Commercial and multifamily7,198 — — — 7,198 306,160 313,358 
Construction and land1,210 — 296 — 1,506 115,372 116,878 
Manufactured homes261 155 52 — 468 26,485 26,953 
Floating homes— — — — — 74,443 74,443 
Other consumer360 5 — — 365 17,558 17,923 
Commercial business4 — — — 4 23,811 23,815 
Total$9,542 $449 $2,398 $— $12,389 $855,167 $867,556 
The following table represents the aging of the recorded investment in past due loans at December 31, 2021, by type of loan (in thousands):
 30-59 Days
Past Due		60-89 Days
Past Due		Greater Than 90
Days Past Due		Recorded Investment
> 90 Days and Accruing		Total
Past Due		CurrentTotal
Loans
One-to-four family$1,805 $58 $87 $— $1,950 $205,710 $207,660 
Home equity— — 140 — 140 13,110 13,250 
Commercial and multifamily— — — — — 278,175 278,175 
Construction and land837 — — — 837 62,268 63,105 
Manufactured homes123 — 59 — 182 21,454 21,636 
Floating homes— — 244 — 244 59,024 59,268 
Other consumer2 76 — — 78 16,670 16,748 
Commercial business6 — 176 — 182 27,844 28,026 
Total$2,773 $134 $706 $— $3,613 $684,255 $687,868 
Nonperforming Loans. Loans are considered nonperforming when they are placed on nonaccrual, or are greater than 90 days past due and still accruing.
The following table represents the credit risk profile based on payment activity as of the dates indicated, by type of loan (in thousands):
December 31, 2022
One-to-four
Family		Home
Equity		Commercial
and Multifamily		Construction
and Land		Manufactured
Homes		Floating
Homes		Other
Consumer		Commercial
Business		Total
Performing$272,503 $19,406 $313,358 $116,554 $26,857 $74,443 $17,661 $23,815 $864,597 
Nonperforming2,135 142 — 324 96 — 262 — 2,959 
Total$274,638 $19,548 $313,358 $116,878 $26,953 $74,443 $17,923 $23,815 $867,556 

December 31, 2021
 One-to-four
Family		Home
Equity		Commercial
and Multifamily		Construction
and Land		Manufactured
Homes		Floating
Homes		Other
Consumer		Commercial
Business		Total
Performing$205,453 $13,110 $275,795 $63,072 $21,514 $58,775 $16,748 $27,850 $682,316 
Nonperforming2,207 140 2,380 33 122 493 — 176 5,552 
Total$207,660 $13,250 $278,175 $63,105 $21,636 $59,268 $16,748 $28,026 $687,868 
Impaired Loans. A loan is considered impaired when it is determined that the Company may not be able to collect payments of principal or interest when due under the terms of the loan. In the process of identifying loans as impaired, the Company takes into consideration factors which include payment history and status, collateral value, financial condition of the borrower, and the probability of collecting scheduled payments in the future. Minor payment delays and insignificant payment shortfalls typically do not result in a loan being classified as impaired. The significance of payment delays and shortfalls is considered on a case-by-case basis, after taking into consideration the totality of circumstances surrounding the loan and the borrower, including payment history. Impairment is measured on a loan-by-loan basis for all loans in the portfolio. All TDRs are also classified as impaired loans and are included in the loans individually evaluated for impairment in the calculation of the allowance for loan losses.
Impaired loans at December 31, 2022 and 2021, by type of loan were as follows (in thousands):
December 31, 2022
 Recorded Investment 
Unpaid Principal
Balance		Without
Allowance		With
Allowance		Total
Recorded
Investment		Related
Allowance
One-to-four family$3,758 $3,038 $708 $3,746 $102 
Home equity210 142 68 210 5 
Construction and land358 324 34 358 3 
Manufactured homes187 93 94 187 52 
Other consumer343 261 82 343 22 
Total$4,856 $3,858 $986 $4,844 $184 
 December 31, 2021
  Recorded Investment 
 Unpaid Principal
Balance		Without
Allowance		With
Allowance		Total
Recorded
Investment		Related
Allowance
One-to-four family$4,177 $3,109 $957 $4,066 $112 
Home equity215 140 75 215 7 
Commercial and multifamily2,380 2,380 — 2,380 — 
Construction and land68 33 35 68 4 
Manufactured homes221 44 177 221 144 
Floating homes493 493 — 493 — 
Other consumer106 — 106 106 26 
Commercial business176 176 — 176 — 
Total$7,836 $6,375 $1,350 $7,725 $293 
The following table provides the average recorded investment and interest income on impaired loans for the year ended December 31, 2022 and 2021, by type of loan (in thousands):
 
Year Ended
December 31, 2022
Year Ended
December 31, 2021
 Average
Recorded
Investment		Interest Income
Recognized		Average
Recorded
Investment		Interest Income
Recognized
One-to-four family$3,628 $106 $3,471 $198 
Home equity216 16 287 16 
Commercial and multifamily1,405 — 617 138 
Construction and land124 20 111 4 
Manufactured homes202 15 239 17 
Floating homes98 — 508 18 
Other consumer299 17 110 5 
Commercial business69 — 318 2 
Total$6,041 $174 $5,661 $398 

Forgone interest on nonaccrual loans was $174 thousand and $138 thousand for the year ended December 31, 2022 and 2021, respectively.
Troubled debt restructurings. TDRs, accounted for under ASC 310-40, are loans which have renegotiated loan terms to assist borrowers who are unable to meet the original terms of their loans. Such modifications to loan terms may include a lower interest rate, a reduction in principal, or a longer term to maturity. Once a TDR has performed according to its modified terms for six months and the collection of principal and interest under the revised terms is deemed probable, we remove the TDR from nonperforming status. Loans classified as TDRs totaled $2.0 million and $2.6 million at December 31, 2022 and 2021, respectively, and are included in impaired loans. The Company has granted, in its TDRs, a variety of concessions to borrowers in the form of loan modifications. The modifications granted can generally be described in the following categories:
Rate Modification: A modification in which the interest rate is changed.
Term Modification: A modification in which the maturity date, timing of payments or frequency of payments is changed.
Payment Modifications: A modification in which the dollar amount of the payment is changed. Interest only modifications in which a loan is converted to interest only payments for a period of time are included in this category.
Combination Modification: Any other type of modification, including the use of multiple categories above.
There were two loans totaling $155 thousand that were modified as a TDR during the year ended December 31, 2022. The following TDR loans were paid off during the year ended December 31, 2022: two one-to-four family loans totaling $597
thousand, one commercial loan totaling $176 thousand, one consumer loan totaling $17 thousand, and one manufactured home loan totaling $15 thousand.
There were no TDRs for which there was a payment default within the first 12 months of modification during the year ended December 31, 2022 and 2021.
There were no TDRs that were charged off during the year ended December 31, 2022 and one commercial business TDR loan totaling $45 thousand that was charged off during the year ended December 31, 2021.
The Company had no commitments to extend additional credit to borrowers owing receivables whose terms have been modified into TDRs.
Related Parties and Regulatory Matters. In the ordinary course of business, the Company makes loans to its employees, officers and directors. Certain loans to employees, officers and directors are offered at discounted rates as compared to other clients as permitted by federal regulations. Employees, officers, and directors are eligible for mortgage loans with an adjustable rate that resets annually to 1.0% - 1.5% over the Bank's rolling cost of funds. Employees, officers and directors are also eligible for consumer loans that are 1.00% below the market loan rate at the time of origination. Director and officer loans are summarized as follows (in thousands):
 December 31,
 20222021
Balance, beginning of period$4,365 $3,995 
Advances100 — 
New / (reclassified) loans, net(822)551 
Repayments(315)(181)
Balance, end of period$3,328 $4,365 
At December 31, 2022 and 2021, loans totaling $16.4 million and $7.3 million, respectively, represented real estate secured loans that had current loan-to-value ratios above supervisory guidelines.
v3.22.4
Mortgage Servicing Rights
 12 Months Ended
Dec. 31, 2022
Transfers and Servicing [Abstract]  
Mortgage Servicing Rights Mortgage Servicing RightsThe unpaid principal balances underlying the Company’s MSR portfolio totaled $472.5 million at December 31, 2022, compared to $508.1 million at December 31, 2021. Of this total balance, the unpaid principal balance of loans serviced for Federal National Mortgage Association (“Fannie Mae”) at December 31, 2022 and 2021 was $470.3 million and $504.1 million, respectively. The unpaid principal balances of loans serviced for other financial institutions at December 31, 2022 and 2021, totaled $2.2 million and $4.0 million, respectively. Loans serviced for Fannie Mae and others are not included in the Company’s financial statements as they are not assets of the Company. 
A summary of the change in the balance of mortgage servicing assets at December 31, 2022 and 2021 were as follows (in thousands):
December 31,
20222021
Beginning balance, at fair value$4,273 $3,780 
Servicing rights that result from transfers and sale of financial assets207 1,301 
Changes in fair value:
Due to changes in model inputs or assumptions(1)
207 (808)
Ending balance, at fair value$4,687 $4,273 
(1) Includes changes due to collection/realization of expected cash flows and curtailments.
The key economic assumptions used in determining the fair value of MSRs at December 31, 2022 and 2021 are as follows:
 December 31,
 20222021
Prepayment speed (Public Securities Association "PSA" model)132 %205 %
Weighted-average life7.5 years5.8 years
Yield to maturity discount rate12.5 %12.5 %
The amount of contractually specified servicing, late and ancillary fees earned on the MSRs are included in “Mortgage servicing income” on the Consolidated Statements of Income and totaled $1.2 million and $1.3 million for the years ended December 31, 2022 and 2021, respectively.
See "Note 1—Organization and Significant Accounting Policies" and "Note 11— Fair Measurements" for additional information on MSRs.
v3.22.4
Premises and Equipment
 12 Months Ended
Dec. 31, 2022
Property, Plant and Equipment [Abstract]  
Premises and Equipment Premises and Equipment
Premises and equipment at December 31, 2022 and 2021 are summarized as follows (in thousands):
 December 31,
 20222021
Land$920 $920 
Buildings and improvements7,168 7,059 
Furniture and equipment6,092 5,804 
14,180 13,783 
Less: Accumulated depreciation and amortization(8,667)(7,964)
Premises and equipment, net$5,513 $5,819 
Depreciation and amortization expense was $704 thousand and $676 thousand for the years ended December 31, 2022 and 2021, respectively.
The Company leases office space in several buildings as well as certain equipment. See "Note 12—Leases" for additional information on our leased facilities and equipment.
v3.22.4
Other Real Estate Owned and Repossessed Assets
 12 Months Ended
Dec. 31, 2022
Real Estate [Abstract]  
Other Real Estate Owned and Repossessed Assets Other Real Estate Owned and Repossessed Assets
The following table presents activity related to OREO and other repossessed assets for the years ended December 31, 2022 and 2021 (in thousands).
 Year Ended December 31,
 20222021
Beginning balance, January 1$659 $594 
Additions to OREO and repossessed assets— 84 
Sales— (19)
Ending balance, December 31$659 $659 
As of December 31, 2022, there were four one-to-four family loans totaling $1.6 million that were in process of foreclosure.
v3.22.4
Deposits
 12 Months Ended
Dec. 31, 2022
Deposits [Abstract]  
Deposits Deposits
A summary of deposit accounts with the corresponding weighted-average cost of funds at December 31, 2022 and 2021, are presented below (dollars in thousands):
 December 31, 2022December 31, 2021
 Deposit
Balance		Wtd. Avg
Rate		Deposit
Balance		Wtd. Avg
Rate
Noninterest-bearing demand$170,549 — %$187,684 — %
Interest-bearing demand254,982 0.21 307,061 0.19 
Savings95,641 0.05 103,401 0.08 
Money market74,639 0.28 91,670 0.21 
Certificates210,305 0.97 105,722 1.57 
Escrow (1)
2,647 — 2,782 — 
Total$808,763 0.37 %$798,320 0.41 %
(1)Escrow balances shown in “Noninterest-bearing deposits” on the Consolidated Balance Sheets.
Scheduled maturities of time deposits at December 31, 2022, are as follows (in thousands):
Year Ending December 31,Amount
2023$169,273 
202433,138 
20255,042 
20262,049 
2027791 
Thereafter12 
 $210,305 
Savings, demand, and money market accounts have no contractual maturity. Certificates of deposit have maturities of six years or less.
The aggregate amount of time deposits in denominations of more than $250 thousand at December 31, 2022 and 2021, totaled $56.1 million and $19.1 million, respectively. Deposits in excess of $250 thousand are not federally insured. There were no brokered deposits outstanding at December 31, 2022 and 2021.
Deposits from related parties held by the Company were $8.1 million and $4.9 million at December 31, 2022 and 2021, respectively.
v3.22.4
Borrowings, FHLB Stock and Subordinated Notes
 12 Months Ended
Dec. 31, 2022
Debt Disclosure [Abstract]  
Borrowings, FHLB Stock and Subordinated Notes Borrowings, FHLB Stock and Subordinated Notes
The Company utilizes a loan agreement with the FHLB of Des Moines, the terms of which call for a blanket pledge of a portion of the Company's mortgage and commercial and multifamily portfolios based on the outstanding balance. At December 31, 2022 and 2021, the maximum amount available to borrow under this credit facility was $442.1 million and $417.7 million, respectively, subject to eligible pledged collateral. At December 31, 2022, the credit facility was collateralized as follows: one-to-four family mortgage loans with an advance equivalent of $204.1 million, commercial and multifamily mortgage loans with an advance equivalent of $45.4 million and home equity loans with an advance equivalent of $505 thousand. At December 31, 2021, the credit facility was collateralized as follows: one-to-four family mortgage loans with an advance equivalent of $59.7 million, commercial and multifamily mortgage loans with an advance equivalent of $52.9 million and home equity loans with an advance equivalent of $482 thousand. The Company had $43.0 million of outstanding overnight borrowings under this arrangement at December 31, 2022 and none at December 31, 2021. The weighted-average interest rate of the Company's borrowings under this arrangement was 2.14% and 0.00% for the years ended December 31, 2022 and 2021, respectively. The maximum amount outstanding from FHLB advances during 2022 was $114.0 million and during 2021 was zero. The average balance outstanding was $27.3 million during 2022 and zero during 2021.
The Company had outstanding letters of credit from the FHLB of Des Moines with a notional amount of $8.0 million and $11.5 million at December 31, 2022 and 2021, respectively, to secure public deposits. At December 31, 2022 and 2021, the remaining amount available to borrow from the FHLB of Des Moines was $199.0 million and $101.5 million, respectively. 
As a member of the FHLB system, the Bank is required to maintain a minimum level of investment in the FHLB of Des Moines stock based on specific percentages of its outstanding FHLB advances. At December 31, 2022 and 2021, the Company had an investment of $2.8 million and $1.0 million, respectively, in FHLB of Des Moines stock.
The Company participates in the Federal Reserve Bank Borrower-in-Custody program, which gives the Company access to the discount window. The terms of the program call for a pledge of specific assets. The Company pledges commercial and consumer loans as collateral for this borrower-in-custody line of credit. The Company had unused borrowing capacity of $20.8 million and $22.4 million under the borrower-in-custody program at December 31, 2022 and 2021, respectively. The Company had no outstanding borrowings under the program at December 31, 2022 and 2021.
The Company has access to an unsecured Fed Funds line of credit from the Pacific Coast Banker's Bank. The line has a one-year term maturing on June 30, 2023 and is renewable annually. At December 31, 2022, the amount available under this line of credit was $20.0 million. There was no balance on this line of credit at December 31, 2022 or 2021.
Sound Financial Bancorp completed a private placement of $12.0 million in aggregate principal of 5.25% Fixed-to-Floating Rate Subordinated Notes (the "subordinated notes") due 2030 resulting in net proceeds, after placement fees and offering expenses, of approximately $11.6 million during the year ended December 31, 2020. The subordinated notes have a stated maturity of October 1, 2030 and bear interest at a fixed rate of 5.25% per year until October 1, 2025. From October 1, 2025 to the maturity date or early redemption date, the interest rate will reset quarterly at a variable rate equal to the then current three-month term secured overnight financing rate (“SOFR”), plus 513 basis points. As provided in the subordinated notes, the interest rate on the subordinated notes during the applicable floating rate period may be determined based on a rate other than three-month term SOFR. Prior to October 1, 2025, Sound Financial Bancorp may redeem the subordinated notes, in whole but not in part, only under certain limited circumstances set forth in the subordinated notes. On or after October 1, 2025, Sound Financial Bancorp may redeem the subordinated notes, in whole or in part, at its option, on any interest payment date. Any redemption by Sound Financial Bancorp would be at a redemption price equal to 100% of the principal amount of the subordinated notes being redeemed, together with any accrued and unpaid interest on the subordinated notes being redeemed to but excluding the date of redemption. The subordinated notes are unsecured obligations and are subordinated in right of payment to all existing and future indebtedness, deposits and other liabilities of Sound Financial Bancorp 's current and future subsidiaries, including the Bank’s deposits as well as Sound Financial Bancorp 's subsidiaries' liabilities to general creditors and liabilities arising during the ordinary course of business. The subordinated notes may be included in Tier 2 capital for Sound Financial Bancorp under current regulatory guidelines and interpretations. At December 31, 2022 and 2021, subordinated notes included $324 thousand and $366 thousand of unamortized debt issuance costs.
v3.22.4
Fair Value Measurements
 12 Months Ended
Dec. 31, 2022
Fair Value Disclosures [Abstract]  
Fair Value Measurements Fair Value Measurements
The Company determines the fair values of its financial instruments based on the requirements established in ASC 820, Fair Value Measurements, which provides a framework for measuring fair value in accordance with U.S. GAAP and requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 defines fair values for financial instruments as the exit price, the price that would be received for an asset or paid to transfer a liability, in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date under current market conditions. The Company’s fair values for financial instruments at December 31, 2022 and 2021 were determined based on these requirements.
The following methods and assumptions were used to estimate the fair value of other financial instruments:
Cash and cash equivalents - The estimated fair value is equal to the carrying amount.
Available-for-sale securities – AFS securities are recorded at fair value based on quoted market prices, if available.  If quoted market prices are not available, management utilizes third-party pricing services or broker quotations from dealers in the specific instruments.  Level 2 securities include those traded on an active exchange, as well as U.S. government securities.  
Held-to-maturity securities – The fair value is based on quoted market prices, if available.  If quoted market prices are not available, management utilizes third-party pricing services or broker quotations from dealers in the specific instruments.  Level 2 securities include those traded on an active exchange, as well as U.S. government securities.  
Loans held-for-sale - The fair value of fixed-rate one-to-four family loans is based on whole loan forward prices obtained from government sponsored enterprises. At December 31, 2022 and December 31, 2021, loans held-for-sale were carried at cost, as no impairment was required.
Loans held-for-portfolio - The estimated fair value of loans-held-for portfolio consists of a credit adjustment to reflect the estimated adjustment to the carrying value of the loans due to credit-related factors and a yield adjustment, to reflect the estimated adjustment to the carrying value of the loans due to a differential in yield between the portfolio loan yields and estimated current market rate yields on loans with similar characteristics. The estimated fair values of loans held-for-portfolio reflect exit price assumptions. The liquidity premium/discounts are part of the valuation for exit pricing.
Mortgage servicing rights –The fair value of MSRs is determined through a discounted cash flow analysis, which uses interest rates, prepayment speeds, discount rates, and delinquency rate assumptions as inputs.
FHLB stock - The estimated fair value is equal to the par value of the stock.
Non-maturity deposits - The estimated fair value is equal to the carrying amount.
Time deposits - The estimated fair value of time deposits is based on the difference between interest costs paid on the Company’s time deposits and current market rates for time deposits with comparable characteristics.
Borrowings - The fair value of borrowings are estimated using the contractual cash flows of each debt instrument discounted using the Company’s current incremental borrowing rates for similar types of borrowing arrangements.
Subordinated notes - The fair value of subordinated notes is estimated using discounted cash flows based on current lending rates for similar long-term debt instruments with similar terms and remaining time to maturity.
A description of the valuation methodologies used for impaired loans and OREO is as follows:
Impaired loans - The fair value of collateral dependent loans is based on the current appraised value of the collateral less estimated costs to sell, or internally developed models utilizing a calculation of expected discounted cash flows which contain management’s assumptions.
OREO and repossessed assets – The fair value of OREO and repossessed assets is based on the current appraised value of the collateral less estimated costs to sell. 
Off-balance sheet financial instruments - The fair value for the Company’s off-balance sheet loan commitments is estimated based on fees charged to others to enter into similar agreements taking into account the remaining terms of the agreements and credit standing of the Company’s clients. The estimated fair value of these commitments is not significant.
In certain cases, the inputs used to measure fair value may fall into different levels of the hierarchy. In such cases, the lowest level of inputs that is significant to the measurement is used to determine the hierarchy for the entire asset or liability. Transfers between levels of the fair value hierarchy are recognized on the actual date of the event or circumstances that caused the transfer, which generally coincides with the Company’s quarterly valuation process. There were no transfers between levels during the years ended December 31, 2022 and 2021.
The following tables present information about the level in the fair value hierarchy for the Company’s financial assets and liabilities, whether or not recognized or recorded at fair value, as of December 31, 2022 and 2021 (in thousands):
 December 31, 2022Fair Value Measurements Using:
 Carrying
Value		Estimated
Fair Value		Level 1Level 2Level 3
FINANCIAL ASSETS:     
Cash and cash equivalents$57,836 $57,836 $57,836 $— $— 
Available for sale securities10,207 10,207 — 10,207 — 
Held-to-maturity securities2,199 1,810 — 1,810 — 
Loans held-for-portfolio, net 858,382 801,153 — — 801,153 
Mortgage servicing rights4,687 4,687 — — 4,687 
FHLB Stock2,832 2,832 — 2,832 — 
FINANCIAL LIABILITIES:
Non-maturity deposits598,458 598,458 — 598,458 — 
Time deposits210,305 209,965 — 209,965 — 
Borrowings43,000 43,000 — 43,000 — 
Subordinated notes11,676 10,420 — 10,420 — 
 December 31, 2021Fair Value Measurements Using:
 Carrying
Value		Estimated
Fair Value		Level 1Level 2Level 3
FINANCIAL ASSETS:     
Cash and cash equivalents$183,590 $183,590 $183,590 $— $— 
Available for sale securities8,419 8,419 — 8,419 — 
Loans held-for-sale3,094 3,094 — 3,094 — 
Loans held-for-portfolio, net680,092 675,154 — — 675,154 
Mortgage servicing rights4,273 4,273 — — 4,273 
FHLB Stock1,046 1,046 — 1,046 — 
FINANCIAL LIABILITIES:
Non-maturity deposits692,598 692,598 — 692,598 — 
Time deposits105,722 106,834 — 106,834 — 
Subordinated notes11,634 11,634 — 11,634 — 
The following tables present the balance of assets measured at fair value on a recurring basis at December 31, 2022 and 2021 (in thousands):
 Fair Value at December 31, 2022
DescriptionTotalLevel 1Level 2Level 3
Treasury bills$1,594 $— $1,594 $— 
Municipal bonds5,421 — 5,421 — 
Agency mortgage-backed securities3,192 — 3,192 — 
MSRs4,687 — — 4,687 
 Fair Value at December 31, 2021
DescriptionTotalLevel 1Level 2Level 3
Municipal bonds$6,066 $— $6,066 $— 
Agency mortgage-backed securities2,353 — 2,353 — 
MSRs4,273 — — 4,273 
The following table provides a description of the valuation technique, unobservable input, and qualitative information about the unobservable inputs for the Company's assets and liabilities classified as Level 3 and measured at fair value on a recurring basis at December 31, 2022:
Financial
Instrument		 Valuation
Technique		 Unobservable Input(s) Range
(Weighted Average)
MSRs Discounted cash flow Prepayment speed assumption 
119%-461% (132%)
    Discount rate 
10.5%-14.5% (12.5%)
The following table provides a description of the valuation technique, unobservable input, and qualitative information about the unobservable inputs for the Company's assets and liabilities classified as Level 3 and measured at fair value on a recurring basis at December 31, 2021:
Financial
Instrument		 Valuation
Technique		 Unobservable Input(s) Range
(Weighted Average)
MSRs Discounted cash flow Prepayment speed assumption 
204%-344% (205%)
    Discount rate 
10.5%-14.5% (12.5%)
Generally, any significant increases in the constant prepayment rate and discount rate utilized in the fair value measurement of the MSRs will result in a negative fair value adjustment (and decrease in the fair value measurement). Conversely, a decrease in the constant prepayment rate and discount rate will result in a positive fair value adjustment (and increase in the fair value measurement). An increase in the weighted average life assumptions will result in a decrease in the constant prepayment rate and conversely, a decrease in the weighted average life will result in an increase of the constant prepayment rate. As a result of the difficulty in observing certain significant valuation inputs affecting our “Level 3” fair value assets, we are required to make judgments regarding these items’ fair values. Different persons in possession of the same facts may reasonably arrive at different conclusions as to the inputs to be applied in valuing these assets and their fair values. Such differences may result in significantly different fair value measurements.
There were no assets or liabilities (excluding MSRs) measured at fair value using significant unobservable inputs (Level 3) on a recurring basis during the years ended December 31, 2022 and 2021.
MSRs are measured at fair value using significant unobservable input (Level 3) on a recurring basis and a reconciliation of this asset can be found in "Note 6—Mortgage Servicing Rights."
The following table presents the balance of assets measured at fair value on a nonrecurring basis (in thousands):
 Fair Value at December 31, 2022
DescriptionTotalLevel 1Level 2Level 3
OREO and repossessed assets$659 $— $— $659 
Impaired loans4,844 — — 4,844 
 Fair Value at December 31, 2021
DescriptionTotalLevel 1Level 2Level 3
OREO and repossessed assets$659 $— $— $659 
Impaired loans7,725 — — 7,725 
There were no liabilities carried at fair value, measured on a recurring or nonrecurring basis, at December 31, 2022 and 2021.
The following table provides a description of the valuation technique, observable input, and qualitative information about the unobservable inputs for the Company's assets classified as Level 3 and measured at fair value on a nonrecurring basis at December 31, 2022:
December 31, 2022
Financial
Instrument		 Valuation Technique(s) Unobservable Input(s) Range (Weighted Average)
OREO Third Party Appraisals No discounts N/A
Impaired loans(1)
 Discounted Cash FlowDiscount Rate 
0-12.75% (5%)
Impaired loans(2)
Third Party AppraisalsNo discountsN/A
(1) Represents TDRs included within impaired loans.
(2) Excludes TDRs.
December 31, 2021
Financial
Instrument		 Valuation Technique(s) Unobservable Input(s) Range
(Weighted Average)
OREO Third Party AppraisalsNo discounts N/A
Impaired loans(1)
Discounted Cash FlowDiscount Rate 
0-10% (4%)
Impaired loans(2)
Third Party AppraisalsNo discountsN/A
(1) Represents TDRs included within impaired loans.
(2) Excludes TDRs.
v3.22.4
Leases
 12 Months Ended
Dec. 31, 2022
Leases [Abstract]  
Leases Leases
We have operating leases for branch locations, loan production offices, and our corporate office. The lease term for our leases begins on the date we become legally obligated for the rent payments or we take possession of the building, whichever is earlier. Generally, our real estate leases have initial terms of three to 10 years and typically include one renewal option. Our leases have remaining terms of five months to 6.5 years. The operating leases require us to pay property taxes and operating expenses for the properties.
The following table represents the Consolidated Balance Sheet classification of the Company’s lease right of use assets and lease liabilities at December 31, 2022 and 2021 (in thousands):
December 31,
20222021
Operating lease right of use assets$5,102 $5,811 
Operating lease liabilities5,448 6,242 
The following table represents the components of lease expense for the years ended December 31, 2022 and 2021 (in thousands):
Year Ended December 31,
20222021
Operating lease expense:
Office leases$1,119 $1,134 
Sublease income(11)(11)
Net lease expense$1,108 $1,123 
The following table represents the maturity of lease liabilities at December 31, 2022 (in thousands):
December 31, 2022
Office
Leases
Operating Lease Commitments
2022$1,051 
20231,031 
2024884 
2025864 
2026881 
Thereafter1,196 
Total lease payments5,907 
Less: Present value discount459 
Present value of lease liabilities$5,448 
Lease term and discount rate by lease type at December 31, 2022 and 2021 consist of the following:
December 31,
20222021
Weighted-average remaining lease term:
Office leases6.1 years7.0 years
Weighted-average discount rate (annualized):
Office leases2.63 %2.67 %
Supplemental cash flow information related to leases for the years ended December 31, 2022 and 2021 was as follows (in thousands):
Year Ended December 31,
20222021
Cash paid for amounts included in the measurement of lease liabilities for operating leases:
Operating cash flows
Office leases$1,067 $1,042 
v3.22.4
Earnings Per Share
 12 Months Ended
Dec. 31, 2022
Earnings Per Share [Abstract]  
Earnings Per Share Earnings Per Share
Earnings per share are summarized for the years ended December 31, 2022 and 2021 as follows (in thousands, except per share data):
 Year Ended December 31,
 20222021
Net income$8,804 $9,156 
LESS: Participating dividends - Unvested RSAs(14)(14)
LESS: Income allocated to participating securities - Unvested RSAs(47)(49)
Net income available to common stockholders - basic8,743 9,093 
ADD BACK: Income allocated to participating securities - Unvested RSAs47 49 
LESS: Income reallocated to participating securities - Unvested RSAs(47)(48)
Net income available to common stockholders - diluted$8,743 $9,094 
Weighted average number of shares outstanding, basic2,578,496 2,582,775 
Effect of potentially dilutive common shares34,918 43,741 
Weighted average number of shares outstanding, diluted2,613,414 2,626,516 
Earnings per share, basic$3.39 $3.52 
Earnings per share, diluted$3.35 $3.46 
There were 2,612 anti-dilutive securities for the year ended December 31, 2022. There were no anti-dilutive securities for the year ended December 31, 2021.
v3.22.4
Employee Benefits
 12 Months Ended
Dec. 31, 2022
Share-Based Payment Arrangement [Abstract]  
Employee Benefits Employee Benefits
The Company has a 401(k) retirement plan that allows employees to defer a portion of their salary into the 401(k) plan. The Company matches a portion of employees' salary deferrals. 401(k) plan costs are accrued and funded on a current basis. The Company contributed $259 thousand and $230 thousand to the plan for the years ended December 31, 2022 and 2021, respectively.
The Bank maintains a deferred compensation account for the benefit of Ms. Stewart, established in 1994 in connection with an incentive plan which is no longer active. Ms. Stewart was fully vested in her benefits under this plan as of January 2005. Pursuant to the terms of the plan, payments in an amount equal to the fair market value of the assets in the deferred compensation account shall be made to Ms. Stewart (or to her designated beneficiary in the event of her death) in 120 equal monthly installments commencing on the last day of the month following the month in which her employment with the Bank is terminated. In the event of the death of Ms. Stewart and her designated beneficiary prior to the account being fully paid, the remaining value of the account shall be paid in a lump sum to the beneficiary’s estate. The assets in the deferred compensation account consist of cash, which is held in a certificate of deposit at the Bank and earns interest at market rates. At both December 31, 2022 and 2021, the amount held in the certificates of deposit at the Bank was $111 thousand.
The Bank maintains a nonqualified deferred compensation plan (the “NQDC Plan”), which became effective on January 1, 2017. The purpose of the NQDC Plan is to provide a select group of management or highly-compensated employees of the Bank with an opportunity to defer the receipt of up to eighty percent (80%) of their annual base salary, bonus, performance-based compensation and any commission income and to assist the Company in attracting, retaining and motivating employees of high caliber and experience. In addition to elective deferrals, the Bank may make discretionary and other contributions to be credited to the account of any or all participants, subject to the vesting requirements set forth in the NQDC Plan. Discretionary contributions by the Bank become 100% vested upon the completion of three years of service from a participant’s effective date of participation in the NQDC Plan (with accelerated vesting upon death, disability or a change in control), while other Bank contributions (including matching contributions) vest at the rate of 20% per year, beginning with the participant’s two-year anniversary of his or her date of hire. During the years ended December 31, 2022, and 2021, the Bank made discretionary contributions to the NQDC Plan of $205 thousand and $93 thousand, respectively.
Each participant’s deferred compensation account is credited with an investment return determined as if the account was invested in one or more investment funds. Each participant elects the investment funds in which his or her account shall be
deemed to be invested. Distributions of vested account balances are made upon death, disability, separation from service, or a specified in-service date unforeseeable emergency. Distributions shall be made in a single cash payment or, at the election of the participant, in annual installments for a period of up to ten (10) years in the case of a separation from service and in annual installments for a period of up to five (5) years in the case of an in-service distribution.
The obligations of the Bank under the NQDC Plan are general unsecured obligations of the Bank to pay deferred compensation in the future to eligible participants in accordance with the terms of the NQDC Plan from the general assets of the Bank, although the Bank may establish a trust to hold amounts which the Bank may use to satisfy NQDC Plan distributions from time to time. Distributions from the NQDC Plan are governed by the Internal Revenue Code and the NQDC Plan. The Company may, at any time, in its sole discretion, terminate the NQDC Plan or amend or modify the NQDC Plan, in whole or in part, except that no such termination, amendment or modification shall have any retroactive effect to reduce any amounts deemed to be accrued and vested prior to such amendment.
Supplemental Executive Retirement Plans.
The Company maintains two supplemental executive retirement plans for the benefit of Ms. Stewart, which are intended to be unfunded, non-contributory defined benefit plans maintained primarily to provide her with supplemental retirement income. The first supplemental executive retirement plan ("SERP 1") was effective as of August 14, 2007. The second supplemental executive retirement plan ("SERP 2") was effective as of December 30, 2011, at which time the benefits under SERP 1 were frozen.
Under the terms of SERP 1, as amended, Ms. Stewart is entitled to receive $53,320 per year for life commencing on the first day of the month following her separation from service (as defined in SERP 1) for any reason from Sound Community Bank, subject to a six-month delay if required by Section 409A of the Internal Revenue Code. No payments will be made under SERP 1 in the event of Ms. Stewart's death and any payments that have commenced will cease upon death. In the event Ms. Stewart is involuntarily terminated in connection with a change in control (as defined in SERP 1), she will be entitled to receive the annual benefit described in the first sentence of this paragraph commencing upon such termination, subject to a six-month delay if required by Section 409A of the Internal Revenue Code.
Under the terms of SERP 2, as amended, upon Ms. Stewart's termination of employment with Sound Community Bank for any reason other than death, she will be entitled to receive additional retirement benefits each month for life commencing on the first day of the month following her separation from service (as defined in SERP 2) from Sound Community Bank, subject to a six-month delay if required by Section 409A of the Internal Revenue Code. The additional retirement benefits will equal the amount payable from the annuity underlying SERP 2, which benefits would equal $99,450 per year as of December 31, 2022. In the event of Ms. Stewart's death prior to the commencement of the additional retirement benefits, her beneficiary will be entitled to a single lump sum payment within 90 days thereafter in an amount equal to the Bank's accrual for her retirement benefit under SERP 2 as of the date of death, or approximately $1.1 million at December 31, 2022. If a change in control occurs (as defined in SERP 2), Ms. Stewart will receive her full retirement benefit under SERP 2 commencing upon the first day of the month following her separation from service from Sound Community Bank, subject to a six-month delay if required by Section 409A of the Internal Revenue Code.
Stock Options and Restricted Stock
The Company currently has one active stockholder approved equity incentive plan, the Amended and Restated 2013 Equity Incentive Plan (the "2013 Plan"). The 2013 Plan permits the grant of restricted stock, restricted stock units, stock options, and stock appreciation rights. The equity incentive plan approved by stockholders in 2008 (the "2008 Plan") expired in November 2018 and no further awards may be made under the 2008 Plan; provided, however, all awards outstanding under the 2008 Plan remain outstanding in accordance with their terms. Under the 2013 Plan, 181,750 shares of common stock were approved for awards for stock options and stock appreciation rights and 116,700 shares of common stock were approved for awards for restricted stock and restricted stock units.
At December 31, 2022, awards for stock options totaling 283,484 shares and awards for restricted stock totaling 150,971 shares of Company common stock have been granted in the aggregate, net of any forfeitures, under the 2008 Plan and 2013 Plan to participants. During the years ended December 31, 2022 and 2021, share-based compensation expense totaled $475 thousand and $360 thousand, respectively.
Stock Option Awards
All stock option awards granted under the 2008 Plan vest in 20 percent annual increments commencing one year from the grant date in accordance with the requirements of the 2008 Plan. The stock option awards granted to date under the 2013 Plan provide for immediate vesting of a portion of the award with the balance of the award vesting on the anniversary date of each grant date
in equal annual installments over periods of one-to-four years subject to the continued service of the participant with the Company. All of the options granted under the 2008 Plan and the 2013 Plan are exercisable for a period of 10 years from the date of grant, subject to vesting.
The following is a summary of the Company's stock option plan award activity during the period ended December 31, 2022:
 SharesWeighted-Average
Exercise Price		Weighted-Average
Remaining Contractual
Term In Years		Aggregate
Intrinsic Value
Outstanding at January 1, 2022
91,316 $24.59 4.77$1,772,667 
Granted12,800 42.85 
Exercised(11,421)19.52 
Forfeited(918)34.92 
Expired(252)35.13 
Outstanding at December 31, 2022
91,525 27.64 4.651,109,392 
Exercisable70,559 24.57 3.591,046,742 
Expected to vest, assuming a 0% forfeiture rate over the vesting term
91,525 $27.64 4.65$1,109,392 
At December 31, 2022, there was $112 thousand of total unrecognized compensation cost related to non-vested stock options granted under the Plan. The cost is expected to be recognized over the remaining weighted-average vesting period of 2.5 years. The total intrinsic value of the shares exercised during the years ended December 31, 2022 and 2021 was $207 thousand and $447 thousand, respectively.
The fair value of each option grant is estimated as of the grant date using the Black-Scholes option-pricing model. The fair value of options granted in 2022 and 2021 were determined using the following weighted-average assumptions as of the grant date.
Year Ended December 31,
 20222021
Annual dividend yield1.59 %1.60 %
Expected volatility26.48 %21.67 %
Risk-free interest rate1.64 %0.60 %
Expected term6.00 years6.50 years
Weighted-average grant date fair value per option granted$9.95 $5.64 
Restricted Stock Awards
The fair value of the restricted stock awards is equal to the fair value of the Company's common stock at the date of grant. Compensation expense is recognized over the vesting period that the awards are based. The restricted stock awards granted under the 2008 Plan vest in 20% annual increments commencing one year from the grant date. The restricted stock awards granted to date under the 2013 Plan provide for immediate vesting of a portion of the award with the balance of the award vesting on the anniversary date of each of the grant date in equal annual installments over periods of one to four years subject to the continued service of the participant with the Company.
The following is a summary of the Company's non-vested restricted stock awards for the year ended December 31, 2022:
Non-vested SharesSharesWeighted-Average
Grant-Date Fair Value
Per Share		Aggregate
Intrinsic Value
Per Share
Non-vested at January 1, 2022
17,586 $34.02 
Granted9,700 42.85 
Vested(8,477)36.34 
Forfeited(930)35.58 
Expired— — 
Non-vested at December 31, 2022
17,879 37.63 $39.27 
Expected to vest assuming a 0% forfeiture rate over the vesting term
17,879 $37.63 $39.27 
At December 31, 2022, there was $403 thousand of unrecognized compensation cost related to non-vested restricted stock granted under the Plan. The cost is expected to be recognized over the weighted-average vesting period of 2.4 years. The total fair value of shares vested for the years ended December 31, 2022 and 2021 was $308 thousand and $265 thousand, respectively.
Employee Stock Ownership Plan
In January 2008, the ESOP borrowed $1.2 million from the Company to purchase common stock of the Company, which was paid in full in 2017. In August 2012, in conjunction with the Company's conversion to a full stock company from the mutual holding company structure, the ESOP borrowed an additional $1.1 million from the Company to purchase common stock of the Company. The loan for $1.1 million was being repaid principally by the Bank through contributions to the ESOP over a period of 10 years. The interest rate on the loan is fixed at 2.25%, per annum. At December 31, 2022, the remaining balance of the ESOP loan was zero.
Neither the loan balance nor the related interest expense is reflected on the consolidated financial statements.
For the year ended December 31, 2021, the ESOP was committed to release 11,340 shares of the Company's common stock to participants. There were no unallocated ESOP shares remaining to be released subsequent to December 31, 2021. The funds to purchase shares in the ESOP come from contributions the Bank makes up to twice a year to the Plan. For the years ended December 31, 2022 and 2021, the ESOP trustee purchased 19,438 shares and 7,343 shares of the Company's common stock for inclusion in the Plan. The number of allocated shares was 155,135 and 131,805 at December 31, 2022 and 2021, respectively. The fair value of the 155,135 restricted shares held by the ESOP trust was $6.4 million at December 31, 2022. ESOP compensation expense included in salaries and benefits was $820 thousand and $781 thousand for the years ended December 31, 2022 and 2021, respectively.
v3.22.4
Income Taxes
 12 Months Ended
Dec. 31, 2022
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
The provision for income taxes at December 31, 2022 and 2021 was as follows (in thousands):
 December 31,
 20222021
Current$2,221 $2,315 
Deferred(149)(43)
Total tax expense$2,072 $2,272 
A reconciliation of the provision for income taxes for the years ended December 31, 2022 and 2021, with amounts determined by applying the statutory U.S. federal income tax rate to income before income taxes, is as follows (dollars in thousands):
 Year Ended December 31,
 20222021
Provision at statutory rate$2,282 $2,400 
Tax-exempt income(169)(203)
Other(41)75 
 $2,072 $2,272 
Federal Tax Rate21.0 %21.0 %
Tax exempt rate(1.6)(1.8)
Other(0.3)0.7 
Effective tax rate19.1 %19.9 %
The following table reflects the temporary differences that gave rise to the components of the Company's deferred tax assets at December 31, 2022 and 2021 (in thousands):
 December 31,
 20222021
Deferred tax assets  
Deferred compensation and supplemental retirement$401 $381 
Equity based compensation159 120 
Intangible assets38 46 
Lease liabilities1,075 1,311 
Unrealized loss on securities297 — 
Allowance for loan losses1,596 1,324 
Other, net109 71 
Total deferred tax assets3,675 3,253 
Deferred tax liabilities
Prepaid expenses(159)(100)
FHLB stock dividends(40)(40)
Unrealized gain on securities— (37)
Depreciation(108)(165)
Mortgage servicing rights(493)(568)
Deferred loan costs(952)(739)
Right of use assets(1,056)(1,220)
Total deferred tax liabilities(2,808)(2,869)
Net deferred tax asset$867 $384 
At December 31, 2022 and 2021, the Company had no unrecognized tax benefits. The Company recognizes interest accrued and penalties related to unrecognized tax benefits in "Provision for income taxes" in the Consolidated Statements of Income. During the years ended December 31, 2022 and 2021, the Company recognized no interest and penalties related to income taxes.
The Company or its subsidiary files an income tax return in the U.S. federal jurisdiction. With few exceptions, the Company is no longer subject to U.S. federal income tax examinations by tax authorities for years before 2019.
v3.22.4
Capital
 12 Months Ended
Dec. 31, 2022
Broker-Dealer [Abstract]  
Capital Capital Sound Financial Bancorp is a bank holding company under the supervision of the Federal Reserve. Bank holding companies are subject to capital adequacy requirements of the Federal Reserve under the Bank Holding Company Act of 1956, as amended, and the regulations of the Federal Reserve, except that, pursuant to the Economic Growth, Regulatory Relief and Consumer
Protection Act, effective August 30, 2018, a bank holding company with consolidated assets of less than $3.0 billion is generally not subject to the Federal Reserve’s capital regulations, which parallel the FDIC’s capital regulations.The Bank is a state-chartered, federally insured institution and thereby is subject to the capital requirements established by the FDIC. Failure to meet minimum capital requirements can initiate certain mandatory and, possibly, additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet specific capital regulations that involve quantitative measures of their assets, liabilities, and certain off-balance-sheet items as calculated under regulatory accounting practices.
The capital amounts and classifications are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. Prompt corrective action provisions are not applicable to bank holding companies.
At December 31, 2022, according to the most recent notification from the FDIC, the Bank was categorized as "well capitalized" under the regulatory framework for prompt corrective action. There are no conditions or events since the notification that management believes have changed the Bank’s category.
As of January 1, 2020, the Bank elected to use the Community Bank Leverage Ratio (“CBLR”) framework as provided for in the Economic Growth, Regulatory Relief and Consumer Protection Act. To be eligible to utilize the CBLR, the Bank must have total consolidated assets of less than $10 billion, off-balance sheet exposures of 25% or less of its total consolidated assets, and trading assets and trading liabilities of 5.0% or less of its total consolidated assets, all as of the end of the most recent quarter. Under the CBLR framework, a bank will generally be considered well-capitalized and to have met the risk-based and leverage capital requirements of the capital regulations if it has a CBLR greater than 9.0%. A bank electing the framework that ceases to meet any qualifying criteria in a future period and that has a leverage ratio greater than 8% will be allowed a grace period of two reporting periods to satisfy the CBLR qualifying criteria or comply with the generally applicable capital requirements. A bank may opt out of the framework at any time, without restriction, by reverting to the generally applicable risk-based capital rule. At December 31, 2022, the Bank’s CBLR was 10.83%.
For a bank holding company with less than $3.0 billion in assets, the capital guidelines apply on a bank-only basis and the Federal Reserve expects the holding company's subsidiary banks to be well-capitalized under the prompt corrective action regulations. If Sound Financial Bancorp was subject to regulatory guidelines for bank holding companies with $3.0 billion or more in assets, at December 31, 2022, Sound Financial Bancorp would have exceeded all regulatory capital requirements. The estimated CBLR calculated for Sound Financial Bancorp at December 31, 2022 was 9.86%
During the years ended December 31, 2022 and 2021, the Company repurchased a total of 46,799 and 3,657 shares of Company common stock at an average price of $37.05 and $41.68 per share pursuant to the Company’s stock repurchase program, leaving $2.1 million available for future repurchase under the existing program.
v3.22.4
Concentrations of Credit Risk
 12 Months Ended
Dec. 31, 2022
Risks and Uncertainties [Abstract]  
Concentrations of Credit Risk Concentrations of Credit RiskMost of the Company's business activity is with clients located in the state of Washington. A substantial portion of the loan portfolio is represented by real estate loans throughout western Washington. The ability of the Company's debtors to honor their contracts is dependent upon the real estate and general economic conditions in the area. Loans to one borrower are generally limited by federal banking regulations to 15% of the Company's unimpaired capital and surplus.
v3.22.4
Commitments and Contingencies
 12 Months Ended
Dec. 31, 2022
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies Commitments and Contingencies
The Company is a party to financial instruments with off-balance-sheet risk in the normal course of business to meet the financing needs of its clients. These financial instruments generally represent a commitment to extend credit in the form of loans. The instruments involve, to varying degrees, elements of credit- and interest-rate risk in excess of the amount recognized in the consolidated balance sheets.
The Company's exposure to credit loss, in the event of nonperformance by the other party to the financial instrument for commitments to extend credit, is represented by the contractual notional amount of those instruments. The Company uses the same credit policies in making commitments as it does for on-balance-sheet instruments.
Commitments to extend credit are agreements to lend to a client as long as there is no violation of any condition established by the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Because many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. These commitments are not reflected in the consolidated financial statements.
The Company evaluates each client's creditworthiness on a case-by-case basis. The amount of collateral obtained, if it is deemed necessary by the Company, is based on management's credit evaluation of the client.
Financial instruments whose contract amount represents credit risk were as follow (in thousands):
 December 31,
 20222021
Residential mortgage commitments$3,184 $6,663 
Unfunded construction commitments65,072 89,797 
Unused lines of credit32,793 35,036 
Irrevocable letters of credit275 151 
Total loan commitments$101,323 $131,647 
At December 31, 2022, fixed-rate loan commitments totaled $3.2 million and had a weighted-average interest rate of 7.60%. At December 31, 2021, fixed-rate loan commitments totaled $6.7 million and had a weighted-average interest rate of 4.27%.
At December 31, 2022 and 2021, the Company had letters of credit issued by the FHLB with a notional amount of $8.0 million and $11.5 million, respectively, in order to secure Washington State Public Funds.
In the ordinary course of business, the Company sells loans without recourse that may have to be subsequently repurchased due to defects that occurred during the origination of the loan. The defects are categorized as documentation errors, underwriting errors, early payment defaults, and fraud. When a loan sold to an investor without recourse fails to perform, the investor will typically review the loan file to determine whether defects in the origination process occurred. If a defect is identified, the Company may be required to either repurchase the loan or indemnify the investor for losses sustained. If there are no defects, the Company has no commitment to repurchase the loan. At December 31, 2022 and 2021, the maximum amount of these guarantees totaled $472.5 million and $508.1 million, respectively. These amounts represent the unpaid principal balances of the Company's loans serviced for others' portfolios. There were no loans repurchased during the year ended December 31, 2022 and $284 thousand of loans repurchased during the year ended 2021.
The Company pays certain medical, dental, prescription, and vision claims for its employees, on a self-insured basis. The Company has purchased stop-loss insurance to cover claims that exceed stated limits and has recorded estimated reserves for the ultimate costs for both reported claims and claims incurred but not reported, which were not considered significant at December 31, 2022. At December 31, 2022, the Company recorded $227 thousand of stop loss medical insurance claims exceeding stated coverage limits which offset our medical expense during the year ended December 31, 2022.
At various times, the Company may be the defendant in various legal proceedings arising in connection with its business. It is the opinion of management that the financial position and the results of operations of the Company will not be materially adversely affected by the outcome of any currently pending legal proceedings and that adequate provision has been made in the accompanying consolidated balance sheets.
v3.22.4
Parent Company Financial Information
 12 Months Ended
Dec. 31, 2022
Condensed Financial Information Disclosure [Abstract]  
Parent Company Financial Information Parent Company Financial Information
The Balance Sheets, Statements of Income, and Statements of Cash Flows for Sound Financial Bancorp (Parent Only) are presented below (dollars in thousands):
Balance sheetsDecember 31,
 20222021
Assets  
Cash and cash equivalents$2,152 $4,215 
Investment in Sound Community Bank107,467 100,986 
Other assets85 58 
Total assets$109,704 $105,259 
Liabilities and Stockholders' Equity
Subordinated notes, net$11,676 $11,634 
Other liabilities323 267 
Total liabilities11,999 11,901 
Stockholders' equity97,705 93,358 
Total liabilities and stockholders' equity$109,704 $105,259 
Statements of IncomeYear Ended December 31,
 20222021
Dividend from subsidiary$2,623 $— 
Interest expense on subordinated notes(672)(673)
Other expenses(715)(550)
Income (loss) before income tax benefit and equity in undistributed net income of subsidiary1,236 (1,223)
Income tax benefit306 257 
Equity in undistributed earnings of subsidiary7,232 9,690 
Net income$8,774 $8,724 
Statements of Cash FlowsYear Ended December 31,
 20222021
Cash flows from operating activities:  
Net income$8,774 $8,724 
Adjustments to reconcile net income to net cash provided by operating activities:
Other, net71 (78)
Expense allocation to holding company(134)— 
Equity in undistributed earnings of subsidiary(7,232)(9,690)
Net cash used in operating activities1,479 (1,044)
Cash flows from investing activities:
ESOP shares released— 431 
Net cash provided by investing activities— 431 
Cash flows from financing activities:
Dividends paid(2,031)(2,039)
Repurchase of stock(1,734)(152)
Stock options exercised223 182 
Net cash used in financing activities(3,542)(2,009)
Net decrease in cash(2,063)(2,622)
Cash and cash equivalents at beginning of year4,215 6,837 
Cash and cash equivalents at end of year$2,152 $4,215 
v3.22.4
Revenue from Contracts with Customers
 12 Months Ended
Dec. 31, 2022
Revenue from Contract with Customer [Abstract]  
Revenue from Contracts with Customers Revenue from Contracts with Customers
All of the Company's revenue from contracts with customers in the scope of ASC 606—Revenue from Contracts with Customers ("ASC 606") is recognized in Noninterest Income with the exception of the net loss on OREO and repossessed assets, which is included in Noninterest Expense. The following table presents the Company's sources of Noninterest Income for the year ended December 31, 2022 and 2021 (in thousands). Items outside of the scope of ASC 606 are noted as such.
Year Ended December 31,
 20222021
Noninterest income:  
Service charges and fee income
Account maintenance fees$324 $311 
Transaction-based and overdraft service charges446 356 
Debit/ATM interchange fees1,394 1,322 
Credit card interchange fees40 27 
Loan fees (a)119 178 
Other fees (a)45 53 
Total service charges and fee income2,368 2,247 
Earnings on cash surrender value of bank-owned life insurance (a)219 416 
Mortgage servicing income (a)1,242 1,284 
Fair value adjustment on MSRs (a)207 (808)
Net gain on sale of loans (a)546 4,190 
Total noninterest income$4,582 $7,329 
(a) Not within scope of ASC 606
Account maintenance fees and transaction-based and overdraft service charges
The Company earns fees from its customers for account maintenance, transaction-based and overdraft services. Account maintenance fees consist primarily of account fees and analyzed account fees charged on deposit accounts on a monthly basis.The performance obligation is satisfied and fees are recognized on a monthly basis as the service period is completed. Transaction-based fees and overdraft service fees on deposit accounts are charged to deposit customers for specific services provided to the customer, such as non-sufficient funds, overdraft, and wire services. The performance obligation is completed as the transaction occurs and the fees are recognized at the time each specific service is provided to the customer.
Debit/ATM and credit card interchange income
Debit/ATM interchange income represent fees earned when a debit card issued by the Bank is used for a transaction. The Bank earns interchange fees from debit cardholder transactions through the MasterCard payment network. Interchange fees from cardholder transactions represent a percentage of the underlying transaction value and are recognized daily, concurrently with the transaction processing services provided to the cardholder. The performance obligation is satisfied and the fees are earned when the cost of the transaction is charged to the cardholders' account. Certain expenses directly associated with the debit card are recorded on a net basis with the interchange income.
The Company utilizes a third-party agency relationship to brand credit cards with fees for originating new accounts paid by the issuing bank. Credit card interchange income represents fees earned when a credit card is issued by the third-party agent. Similar to debit card interchange fees, the Bank earns an interchange fee for each transaction made with Sound Community Bank's branded credit cards. The performance obligation is satisfied and the fees are earned when the cost of the transaction is charged to the cardholders' credit card. Certain expenses and rebates directly related to the credit card interchange contract are recorded net of the interchange income.
Net loss on OREO and repossessed assets
We record a gain or loss from the sale of other real estate owned when control of the property transfers to the buyer, which generally occurs at the time of an executed deed of trust. When the Bank finances the sale of OREO to the buyer, the Company assesses whether the buyer is committed to perform their obligations under the contract and whether collectability of the transaction price is probable. Once these criteria are met, the OREO asset is derecognized and the gain or loss on sale is recorded upon the transfer of control of the property to the buyer. In determining the gain or loss on sale, we adjust the transaction price and related gain or loss on sale if a significant financing component is present. The Company generated income/incurred expenses, net of gain/losses on sale of OREO, on our OREO properties of $0 and $(16) thousand for the years ended December 31, 2022 and 2021, respectively, included under noninterest expense on the Consolidated Statements of Income.
v3.22.4
Subsequent Events
 12 Months Ended
Dec. 31, 2022
Subsequent Events [Abstract]  
Subsequent Events Subsequent EventsOn January 27, 2023, the Company declared on Company common stock a quarterly cash dividend of $0.17 per common share, payable on February 23, 2023 to stockholders of record at the close of business February 9, 2023.
v3.22.4
Organization and Significant Accounting Policies (Policies)
 12 Months Ended
Dec. 31, 2022
Accounting Policies [Abstract]  
Subsequent events Subsequent events – The Company has evaluated subsequent events for potential recognition and disclosure.
Basis of Presentation and Use of Estimates
Basis of Presentation and Use of Estimates – The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the allowance for loan losses, the fair value of MSRs, valuations of impaired loans and OREO, and the realization of deferred taxes.
The accompanying consolidated financial statements include the accounts of Sound Financial Bancorp and its wholly-owned subsidiaries, Sound Community Bank and Sound Community Insurance Agency, Inc. All significant intercompany balances and transactions between Sound Financial Bancorp and its subsidiaries have been eliminated in consolidation.
Cash and cash equivalents Cash and cash equivalents – For purposes of reporting cash flows, cash and cash equivalents include cash on hand and in banks and interest-bearing deposits. All have original maturities of three months or less and may exceed federally insured limits.
Investment securities
Investment securities – Investment securities are classified as either held-to-maturity (“HTM”) or available-for-sale (“AFS”). Securities classified as HTM are those that the Company has the positive intent and ability to hold until maturity. These securities are carried at amortized cost, adjusted for the amortization or accretion of premiums or discounts. Securities not classified as HTM or trading are considered AFS securities. AFS securities may be sold to implement the Company's asset/liability management strategies and/or in response to changes in interest rates and similar factors. AFS securities are reported at fair value. Dividend and interest income on investment securities are recognized when earned.
Unrealized gains and losses, net of the related deferred tax effect, are reported as a net amount in accumulated other comprehensive income (loss) on AFS securities in the consolidated balance sheets. Realized gains and losses on AFS securities, determined using the specific identification method, are included in earnings. Amortization of premiums and accretion of discounts are recognized as adjustments to interest income using the interest method over the period to the earlier of call date or maturity.
The Company reviews investment securities on an ongoing basis for the presence of other-than-temporary impairment (“OTTI”) or permanent impairment, taking into consideration current market conditions, fair value in relation to cost, extent and nature of the change in fair value, issuer rating changes and trends, whether the Company intends to sell a security or if it is likely that the Company will be required to sell the security before recovery of its amortized cost basis of the investment, which may be maturity, and other factors. For debt securities, if the Company intends to sell the security or it is likely that it will be required to sell the security before recovering its cost basis, the entire impairment loss would be recognized in earnings as an OTTI. If the Company does not intend to sell the security and it is not likely that we will be required to sell the security but we do not expect to recover the entire amortized cost basis of the security, only the portion of the impairment loss representing credit losses would be recognized in earnings. The credit loss on a security is measured as the difference between the amortized cost basis and the present value of the cash flows expected to be collected. Projected cash flows are discounted by the original or current effective interest rate depending on the nature of the security being measured for potential OTTI.
The remaining impairment related to all other factors, the difference between the present value of the cash flows expected to be collected and the fair value, is recognized as a charge to other comprehensive income. The Company does not intend to sell these securities and it is more likely than not that it will not be required to sell the securities before anticipated recovery of the remaining amortized cost basis. The Company closely monitors its investment securities for changes in credit risk.
Loans held-for-sale Loans held-for-sale – To mitigate interest-rate sensitivity, from time to time, certain fixed-rate mortgage loans are identified as held-for-sale in the secondary market. Accordingly, such loans are classified as held-for-sale in the consolidated balance sheets and are carried at the lower of cost or estimated fair market value in the aggregate. Net unrealized losses, if any, are recognized through a valuation allowance by charges to income. Mortgage loans held-for-sale are generally sold with the mortgage servicing rights retained by the Company. Gains or losses on sales of loans are recognized based on the difference between the selling price and the carrying value of the related loans sold based on the specific identification method.
Loans held-for-portfolio and Allowance for loan losses
Loans held-for-portfolio – The Company originates mortgage, commercial, and consumer loans to clients. A substantial portion of the loan portfolio is represented by loans secured by real estate located throughout the Puget Sound region, especially King, Snohomish and Pierce Counties, and in Clallam and Jefferson Counties of Washington State. The ability of the Company's debtors to honor their contracts is dependent upon employment, real estate and general economic conditions in these areas.
Loans that management has the intent and ability to hold for the foreseeable future or until maturity or pay-off generally are reported at their outstanding unpaid principal balance adjusted for any charge-offs, allowance for loan losses, and any deferred fees or costs on origination of loans. Interest income is accrued on the unpaid principal balance. Loan origination fees, net of certain direct origination costs, are deferred and recognized as an adjustment of the related loan yield using the interest method over the contractual life of the loan for term loans or the straight-line method for open-ended loans.
The accrual of interest is discontinued at the time the loan is 90 days past due or if, in management's opinion, the borrower may be unable to meet payment of obligations as they become due, as well as when required by regulatory provisions. Loans are typically charged off no later than 120 days past due, unless secured by collateral. Past due status is based on contractual terms of the loan. In all cases, loans are placed on nonaccrual or charged off at an earlier date if collection of principal or interest is considered doubtful.
All interest accrued but not collected for loans that are placed on nonaccrual or charged-off is reversed against interest income. The interest on these loans is accounted for on the cash-basis or cost-recovery method, until qualifying for return to accrual. Loans are returned to accrual status when all of the principal and interest amounts contractually due are brought current, future payments are reasonably assured and payments have been received for six consecutive months.
A loan is considered impaired when it is probable that the Company will be unable to collect all amounts (principal and interest) due according to the contractual terms of the original loan agreement. When a loan has been identified as being impaired, the amount of the impairment is measured by using discounted cash flows, except when, as a practical expedient, the current fair value of the collateral, reduced by costs to sell, is used. When the measurement of the impaired loan is less than the recorded investment in the loan (including accrued interest), impairment is recognized by charging off the impaired portion or creating or adjusting a specific allocation of the allowance for loan losses. The Company recognizes interest income on impaired loans, including cash receipts, based on its existing methods of recognizing interest income on nonaccrual loans.
A loan is classified as a troubled debt restructuring ("TDR") when certain concessions have been made to the contractual terms, such as reductions of interest rates or deferrals of interest or principal payments due to the borrower's deteriorated financial condition. All TDRs are reported and accounted for as impaired loans.
Allowance for loan losses – The allowance for loan losses is a reserve established through a provision for loan losses charged to expense and represents management's best estimate of probable incurred losses within the existing loan portfolio as of the balance sheet date. The level of the allowance reflects management's view of trends in loan loss activity, current loan portfolio quality and present economic, political and regulatory conditions. Portions of the allowance may be allocated for specific loans; however, the allowance is available for any loan that is charged off. The allowance is increased by provisions charged to earnings and by recoveries of amounts previously charged off, and is reduced by charge-offs on loans (or portions thereof) deemed to be uncollectible. Loan charge-offs are recognized when management believes the collectability of the principal balance outstanding is unlikely. Full or partial charge-offs on collateral dependent impaired loans are generally recognized when the collateral is deemed to be insufficient to support the carrying value of the loan.
The allowance for loan losses is maintained at a level sufficient to provide for probable credit losses based upon evaluating known and inherent risks in the loan portfolio. The allowance is provided based upon management's continuing analysis of the pertinent factors underlying the quality of the loan portfolio. These factors include changes in the size and composition of the loan portfolio, delinquency levels, actual loan loss experience, current economic conditions, and detailed analysis of individual loans for which full collectability may not be assured. The detailed analysis includes techniques to estimate the fair value of
loan collateral and the existence of potential alternative sources of repayment. The allowance consists of specific, general and unallocated components.
The general component of the allowance for loan losses covers non-impaired loans and is determined using a formula-based approach. The formula first incorporates either the historical loss rates of the Company or the historical loss rates of its peer group if minimal loss history exists. This historical loss rate factor is then adjusted for qualitative factors. Qualitative factors are used to estimate losses related to factors that are not captured in the historical loss rates and are based on management’s evaluation of available internal and external data and involve significant management judgement. Qualitative factors include changes in lending standards, changes in economic conditions, changes in the nature and volume of loans, changes in lending management, changes in delinquencies, changes in the loan review system, changes in the value of collateral, the existence of concentrations, and the impact of other external factors. Finally, the general component of the allowance for loan losses is adjusted for changes in the assigned grades of loans, which include the following: pass, watch, special mention, substandard, doubtful, and loss. As loans are downgraded from watch to the lower categories, they are assigned an additional factor to account for the increased credit risk. Loan grades involve significant management judgment.
For such loans that are also classified as impaired, a specific component within the allowance is established when the discounted cash flows (or collateral value or observable market price) of the impaired loan are lower than the carrying value of that loan.
An unallocated component is maintained to cover uncertainties that could affect management's estimate of probable losses. The unallocated component of the allowance reflects the margin of imprecision inherent in the underlying assumptions used in the methodologies for estimating specific and general losses in the portfolio.
The Company considers installment loans to be pools of smaller balance, homogenous loans that are collectively evaluated for impairment, unless such loans are subject to a TDR agreement.
The appropriateness of the allowance for loan losses is estimated based upon those factors and trends identified by management at the time consolidated financial statements are prepared. When available information confirms that specific loans or portions thereof are uncollectible, identified amounts are charged against the allowance for loan losses.
The existence of some or all of the following criteria will generally confirm that a loss has been incurred: the loan is significantly delinquent and the borrower has not demonstrated the ability or intent to bring the loan current; the Company has no recourse to the borrower, or if it does, the borrower has insufficient assets to pay the debt; the estimated fair value of the loan collateral is significantly below the current loan balance, and there is little or no near-term prospect for improvement.
The ultimate recovery of all loans is susceptible to future market factors beyond the Company's control. These factors may result in losses or recoveries differing significantly from those provided in the consolidated financial statements.
Transfers of financial assets Transfers of financial assets – Transfers of an entire financial asset, or a participating interest in an entire financial asset, are accounted for as sales when control over the assets has been surrendered. Control over transferred assets is deemed to be surrendered when: (1) a group of financial assets or a participating interest in an entire financial asset has been isolated from the Company, (2) the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets, and (3) the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity.
Mortgage servicing rights Mortgage servicing rights – MSRs represent the value associated with servicing residential mortgage loans, when the mortgage loans have been sold into the secondary market and the related servicing has been retained by the Company. The Company may also purchase MSRs. The value is determined through a discounted cash flow analysis, which uses interest rates, prepayment speeds and delinquency rate assumptions as inputs. All of these assumptions require a significant degree of management judgment. The Company measures its mortgage servicing assets at fair value and reports changes in fair value through earnings under the caption fair value adjustment on MSRs in other income in the period in which the change occurs. The fair values of servicing rights are subject to significant fluctuations as a result of changes in estimates and actual prepayment speeds and default rates and losses. Currently, we do not hedge the effects of changes in fair value of our servicing assets.
Premises and equipment Premises and equipment – Premises, leasehold improvements and furniture and equipment are carried at cost, less accumulated depreciation and amortization. Furniture and equipment are depreciated using the straight-line method over the estimated useful lives of the assets, which range from 1 to 10 years. The cost of leasehold improvements is amortized using the straight-line method over the terms of the related leases. The cost of premises is amortized using the straight-line method over the estimated useful life of the building, up to 39 years. Management reviews premises, leasehold improvements and furniture and equipment for impairment when factors exist indicating potential impairment.
Bank-owned life insurance, net Bank-owned life insurance, net – The carrying amount of BOLI approximates its fair value, and is estimated using the cash surrender value, net of any surrender charges.
Federal Home Loan Bank stock Federal Home Loan Bank stock – The Company is a member of the FHLB of Des Moines. FHLB stock represents the Company's investment in the FHLB and is carried at par value, which reasonably approximates its fair value. As a member of the FHLB, the Company is required to maintain a minimum level of investment in FHLB stock based on specific percentages of its outstanding mortgages, total assets, or FHLB advances. Typically, the Company may request redemption at par value of any stock in excess of the minimum required investment. Stock redemptions are at the discretion of the FHLB.
Other real estate owned and repossessed assets
Other real estate owned and repossessed assets – OREO and repossessed assets represent real estate and other assets which the Company has taken control of in partial or full satisfaction of loans. At the time of foreclosure, OREO and repossessed assets are recorded at fair value less estimated costs to sell, which becomes the new basis. Any write-downs based on the asset's fair value at the date of acquisition are charged to the allowance for loan and lease losses. After foreclosure, management periodically performs valuations such that the property is carried at the lower of its new cost basis or fair value, net of estimated costs to sell. Revenue and expenses from operations and subsequent adjustments to the carrying amount of the property are included in other noninterest expense in the consolidated statements of income.
In some instances, the Company may make loans to facilitate the sales of OREO. Management reviews all sales for which it is the lending institution. Any gains related to sales of other real estate owned may be deferred until the buyer has a sufficient investment in the property.
Leases Leases – We determine if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use assets and operating lease liabilities in our consolidated balance sheets. Right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease right-of-use assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, we generally use our incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. The operating lease right-of-use asset also includes any lease payments made and excludes lease incentives. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. Additionally, for equipment leases, we apply a portfolio approach to effectively account for the operating lease right-of-use assets and liabilities. The Company has not entered into leases that meet the definition of a financing lease.
Income Taxes Income Taxes – Income taxes are accounted for using the asset and liability method. Under this method a deferred tax asset or liability is determined based on the enacted tax rates which will be in effect when the differences between the financial statement carrying amounts and tax basis of existing assets and liabilities are expected to be reported in the Company's income tax returns. The effect on deferred taxes of a change in tax rates is recognized in income in the period that includes the enactment date. Valuation allowances are established to reduce the net carrying amount of deferred tax assets if it is determined to be more likely than not, that all or some portion of the potential deferred tax asset will not be realized.
Segment reporting Segment reporting – The Company operates in one segment and makes management decisions based on consolidated results. The Company's operations are solely in the financial services industry and include providing to its clients traditional banking and other financial services.
Off-balance-sheet credit-related financial instruments Off-balance-sheet credit-related financial instruments – In the normal course of operations, the Company engages in a variety of financial transactions that are not recorded in our financial statements. These transactions involve varying degrees of off-balance sheet credit, interest rate and liquidity risks. These transactions are used primarily to manage customers' requests for funding and take the form of loan commitments, letters of credit and lines of credit. Such financial instruments are recorded when they are funded. The Company also maintains a separate allowance for off-balance sheet credit commitments. Management estimates anticipated losses using historical data and utilization assumptions. The allowance for off-balance sheet credit commitments totaled $336 thousand and $405 thousand at December 31, 2022 and 2021, respectively, and is included in other liabilities on the consolidated balance sheets.
Advertising costs Advertising costs – The Company expenses advertising costs as they are incurred.
Comprehensive income Comprehensive income – Accounting principles generally require that recognized revenue, expenses, gains, and losses be included in net income. Certain changes in assets and liabilities, such as unrealized gains and losses on available-for-sale investments, are reported as a separate component of the equity section of the consolidated balance sheets, net of tax. Such items, along with net income, are components of comprehensive income.
Intangible assets Intangible assets – At December 31, 2022 and 2021, the Company had $67 thousand and $97 thousand, respectively, of identifiable intangible assets included in other assets as a result of the acquisition of deposits from other institutions. These assets are amortized using the straight-line method over a period of eight to ten years and have a remaining weighted average life of 2.3 years. Management reviews intangible assets for impairment on an annual basis, or whenever events occur or circumstances change indicating the carrying amount of the intangible asset may not be recoverable.
Employee stock ownership plan
Employee stock ownership plan – The Company sponsors an internally-leveraged ESOP. As shares are committed to be released, compensation expense is recorded equal to the market price of the shares, and the shares become outstanding for purposes of earnings per share calculations. Cash dividends on allocated shares (those credited to ESOP participants' accounts) are recorded as a reduction of stockholders' equity and distributed directly to participants' accounts. Cash dividends on unallocated shares (those held by the ESOP not yet credited to participants' accounts) are used to pay administrative expenses and debt service requirements of the ESOP. See "Note 14—Employee Benefits" for further information.
Unearned ESOP shares are shown as a reduction of stockholders' equity. When the shares are released, unearned common shares held by the ESOP are reduced by the cost of the ESOP shares released and the differential between the fair value and the cost is charged to additional paid in capital. The loan receivable from the ESOP to the Company is not reported as an asset nor is the debt of the ESOP reported as a liability on the Company's consolidated statements of condition.
Earnings Per Common Share Earnings Per Common Share – Earnings per share is computed using the two-class method. Basic earnings per share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding during the period, excluding any participating securities. Participating securities include unvested restricted shares. Unvested restricted shares are considered participating securities because holders of these securities receive non-forfeitable dividends at the same rate as the holders of the Company's common stock. Diluted earnings per share is computed by dividing net income available to common stockholders adjusted for reallocation of undistributed earnings of unvested restricted shares by the weighted average number of common shares determined for the basic earnings per share plus the dilutive effect of common stock equivalents using the treasury stock method based on the average market price for the period. Some stock options are anti-dilutive and therefore are not included in the calculation of diluted earnings per share.
Fair value
Fair value – Fair value is the price that would be received when an asset is sold or a liability is transferred in an orderly transaction between market participants at the measurement date.
Fair values of the Company's financial instruments are based on the fair value hierarchy which requires an entity to maximize the use of observable inputs, typically market data obtained from third parties, and minimize the use of unobservable inputs, which reflects its estimates for market assumptions, when measuring fair value.
Three levels of valuation inputs are ranked in accordance with the prescribed fair value hierarchy as follows:
Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets.
Level 2: Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active.
Level 3: Assets or liabilities whose significant value drivers are unobservable.
In determining the appropriate levels, the Company performs a detailed analysis of the assets and liabilities that are subject to fair value measurements. In certain cases, the inputs used to measure fair value of an asset or liability may fall into different levels of the fair value hierarchy. The level within which the fair value measurement is categorized is based on the lowest level unobservable input that is significant to the fair value measurement in its entirety. Therefore, an item may be classified in Level 3 even though there may be some significant inputs that are readily observable.
Share-Based Compensation Share-Based Compensation – The Company measures the cost of employee services received in exchange for an award of equity instruments based on the grant date fair value of the award. These costs are recognized on a straight-line basis over the vesting period during which an employee is required to provide services in exchange for the award, also known as the requisite service period. The Company uses the Black-Scholes option pricing model to estimate the fair value of stock options granted. When determining the estimated fair value of stock options granted, the Company utilizes various assumptions regarding the expected volatility of the stock price, the risk-free interest rate for periods within the contractual life of the stock option, and the expected dividend yield that the Company expects over the expected life of the options granted. Reductions in compensation expense associated with forfeited options are expensed based on actual forfeiture experience. The Company measures the fair value of the restricted stock using the closing market price of the Company's common stock on the date of grant. The Company expenses the grant date fair value of the Company's stock options and restricted stock with a corresponding increase in equity. When shares are required to be issued under share-based awards, it is typically the Company’s policy to issue new shares of stock.
Reclassifications Reclassifications – Certain amounts reported in prior years consolidated financial statements may be reclassified to conform to the current presentation. The results of the reclassifications are typically not considered material and have no effect on previously reported net income, earnings per share or stockholders' equity. There were no reclassifications to prior year amounts in the current year.
Accounting pronouncements recently issued or adopted Accounting Pronouncements Recently Issued or Adopted
On March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2020-04, "Reference Rate Reform" ("Topic 848"). This ASU provides optional guidance for a limited period of time to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting. The amendments in this update apply to modifications to eligible contracts (e.g., loans, debt securities, derivatives, borrowings) that replace a reference rate affected by reference rate reform (including rates referenced in fallback provisions) and contemporaneous modifications of other contract terms related to the replacement of the reference rate (including contract modifications to add or change fallback provisions). The following optional expedients for applying the requirements of certain Topics or Industry Subtopics in the Codification are permitted for contracts that are modified because of reference rate reform and that meet certain scope guidance: 1) Modifications of contracts within the scope of Topics 310, Receivables, and 470, Debt, should be accounted for by prospectively adjusting the effective interest rate; 2) Modifications of contracts within the scope of Topics 840, Leases, and 842, Leases, should be accounted for as a continuation of the existing contracts with no reassessments of the lease classification and the discount rate (for example, the incremental borrowing rate) or remeasurements of lease payments that otherwise would be required under those Topics for modifications not accounted for as separate contracts; and 3) Modifications of contracts do not require an entity to reassess its original conclusion about whether that contract contains an embedded derivative that is clearly and closely related to the economic characteristics and risks of the host contract under Subtopic 815-15, Derivatives and Hedging— Embedded Derivatives. In January 2021, ASU 2021-01 updated amendments in the new ASU to clarify that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition. The ASU also amends the expedients and exceptions in Topic 848 to capture the incremental consequences of the scope clarification. The amendments in this ASU have differing effective dates, beginning with interim period including and subsequent to March 12, 2020 through December 31, 2022. The Company does not expect the adoption of ASU 2020-04 to have a material impact on its consolidated financial statements.
In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments and subsequent amendments to the initial guidance in November 2018, ASU No. 2018-19, April 2019, ASU 2019-04, May 2019, ASU 2019-05, November 2019, ASU 2019-11, February 2020, ASU 2020-02, and March 2020, ASU 2020-03, all of which clarifies codification and corrects unintended application of the guidance. This ASU replaces the existing incurred loss impairment methodology that recognizes credit losses when a probable loss has been incurred with new methodology where loss estimates are based upon lifetime expected credit losses. The amendments in this ASU require a financial asset that is measured at amortized cost to be presented at the net amount expected to be collected. The income statement would then reflect the measurement of credit losses for newly recognized financial assets as well as changes to the expected credit losses that have taken place during the reporting period. Financial assets that this guidance will apply to include loans receivable, held-to-maturity debt securities, unfunded loan commitments, and certain other financial assets measured at amortized cost. Under this ASU, available-for-sale debt securities are evaluated for impairment if fair value is less than amortized cost, with any estimated credit losses recorded through a credit loss expense and an allowance, rather than a write-down of the investment. Changes in fair value that are not credit-related will continue to be recorded in other comprehensive income. The change in allowance recognized as a result of adoption will occur using a modified retrospective approach through a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the ASU is adopted. The FASB issued ASU No. 2019-10, Financial Instruments - Credit Losses (Topic 326), delaying implementation of ASU No. 2016-13 for SEC smaller reporting company filers until fiscal years beginning after December 15, 2022. The Company meets the requirements of a smaller reporting company and delayed implementation of ASU No. 2016-13. This guidance became effective on January 1, 2023. The Company currently intends to phase the impact of Topic 326 into regulatory capital over three years in accordance with a final ruling effective April 2019 adopted by the Federal Reserve and other U.S. banking agencies.
In March 2022, the FASB issued ASU 2022-02, Financial Instruments - Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures. The ASU eliminates the accounting guidance for troubled debt restructured loans (“TDRs”) by creditors while enhancing disclosure requirements for certain loan refinancings and restructurings by creditors when a borrower is experiencing financial difficulty. Additionally, the ASU requires public business entities to disclose current-period gross write-offs by year of origination for financing receivables and net investments in leases. This ASU will be effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years, upon the Company’s adoption of the amendments in ASU 2016-13, which is commonly referred to as the current expected credit loss methodology. The Company adopted this standard on January 1, 2023.
Fair value of financial instruments
The Company determines the fair values of its financial instruments based on the requirements established in ASC 820, Fair Value Measurements, which provides a framework for measuring fair value in accordance with U.S. GAAP and requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 defines fair values for financial instruments as the exit price, the price that would be received for an asset or paid to transfer a liability, in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date under current market conditions. The Company’s fair values for financial instruments at December 31, 2022 and 2021 were determined based on these requirements.
The following methods and assumptions were used to estimate the fair value of other financial instruments:
Cash and cash equivalents - The estimated fair value is equal to the carrying amount.
Available-for-sale securities – AFS securities are recorded at fair value based on quoted market prices, if available.  If quoted market prices are not available, management utilizes third-party pricing services or broker quotations from dealers in the specific instruments.  Level 2 securities include those traded on an active exchange, as well as U.S. government securities.  
Held-to-maturity securities – The fair value is based on quoted market prices, if available.  If quoted market prices are not available, management utilizes third-party pricing services or broker quotations from dealers in the specific instruments.  Level 2 securities include those traded on an active exchange, as well as U.S. government securities.  
Loans held-for-sale - The fair value of fixed-rate one-to-four family loans is based on whole loan forward prices obtained from government sponsored enterprises. At December 31, 2022 and December 31, 2021, loans held-for-sale were carried at cost, as no impairment was required.
Loans held-for-portfolio - The estimated fair value of loans-held-for portfolio consists of a credit adjustment to reflect the estimated adjustment to the carrying value of the loans due to credit-related factors and a yield adjustment, to reflect the estimated adjustment to the carrying value of the loans due to a differential in yield between the portfolio loan yields and estimated current market rate yields on loans with similar characteristics. The estimated fair values of loans held-for-portfolio reflect exit price assumptions. The liquidity premium/discounts are part of the valuation for exit pricing.
Mortgage servicing rights –The fair value of MSRs is determined through a discounted cash flow analysis, which uses interest rates, prepayment speeds, discount rates, and delinquency rate assumptions as inputs.
FHLB stock - The estimated fair value is equal to the par value of the stock.
Non-maturity deposits - The estimated fair value is equal to the carrying amount.
Time deposits - The estimated fair value of time deposits is based on the difference between interest costs paid on the Company’s time deposits and current market rates for time deposits with comparable characteristics.
Borrowings - The fair value of borrowings are estimated using the contractual cash flows of each debt instrument discounted using the Company’s current incremental borrowing rates for similar types of borrowing arrangements.
Subordinated notes - The fair value of subordinated notes is estimated using discounted cash flows based on current lending rates for similar long-term debt instruments with similar terms and remaining time to maturity.
A description of the valuation methodologies used for impaired loans and OREO is as follows:
Impaired loans - The fair value of collateral dependent loans is based on the current appraised value of the collateral less estimated costs to sell, or internally developed models utilizing a calculation of expected discounted cash flows which contain management’s assumptions.
OREO and repossessed assets – The fair value of OREO and repossessed assets is based on the current appraised value of the collateral less estimated costs to sell. 
Off-balance sheet financial instruments - The fair value for the Company’s off-balance sheet loan commitments is estimated based on fees charged to others to enter into similar agreements taking into account the remaining terms of the agreements and credit standing of the Company’s clients. The estimated fair value of these commitments is not significant.
In certain cases, the inputs used to measure fair value may fall into different levels of the hierarchy. In such cases, the lowest level of inputs that is significant to the measurement is used to determine the hierarchy for the entire asset or liability. Transfers between levels of the fair value hierarchy are recognized on the actual date of the event or circumstances that caused the transfer, which generally coincides with the Company’s quarterly valuation process. There were no transfers between levels during the years ended December 31, 2022 and 2021.
v3.22.4
Investments (Tables)
 12 Months Ended
Dec. 31, 2022
Investments, Debt and Equity Securities [Abstract]  
Schedule of Amortized Cost and Fair Value of AFS Securities
The amortized cost and fair value of available-for-sale securities and the corresponding amounts of gross unrealized gains and losses at December 31, 2022 and 2021 were as follows (in thousands):
 Amortized
Cost		Gross
Unrealized Gains		Gross
Unrealized Losses		Estimated
Fair Value
December 31, 2022    
Treasury bills$1,596 $— $(2)$1,594 
Municipal bonds6,434 16 (1,029)5,421 
Agency mortgage-backed securities3,591 1 (400)3,192 
Total available-for-sale securities$11,621 $17 $(1,431)$10,207 
December 31, 2021
Municipal bonds$5,931 $148 $(13)$6,066 
Agency mortgage-backed securities2,312 53 (12)2,353 
Total available-for-sale securities$8,243 $201 $(25)$8,419 
Schedule of Amortized Cost and Fair Value of HTM Securities
The amortized cost and fair value of our HTM securities and the corresponding amounts of gross unrealized gains and losses at December 31, 2022 are shown in the table below (in thousands). There were no HTM securities at December 31, 2021.
 Amortized
Cost		Gross
Unrealized
Gains		Gross
Unrealized
Losses		Estimated
Fair Value
December 31, 2022
Municipal bonds$705 $— $(169)$536 
Agency mortgage-backed securities1,494 — (219)1,274 
Total$2,199 $— $(388)$1,810 
Schedule of Amortized Cost and Fair Value of Mortgage-backed Securities by Contractual Maturity The amortized cost and fair value of AFS and HTM securities at December 31, 2022, by contractual maturity, are shown below (in thousands). Expected maturities of AFS securities may differ from contractual maturities because borrowers may have the
right to call or prepay obligations with or without call or prepayment penalties. Investments not due at a single maturity date, primarily mortgage-backed investments, are shown separately.
 December 31, 2022
Available-for-saleHeld-to-maturity
 Amortized
Cost		Fair
Value		Weighted-Average YieldAmortized
Cost		Fair
Value		Weighted-Average Yield
Due within one year$1,596 $1,594 2.86 %$— $— — %
Due in one to five years151 151 3.57 — — — 
Due after five to ten years1,226 1,235 5.26 — — — 
Due after ten years5,057 4,035 2.73 705 536 3.04 
Mortgage-backed securities3,591 3,192 3.07 1,494 1,274 2.51 
Total$11,621 $10,207 3.14 %$2,199 $1,810 2.68 %
Schedule of Aggregate Fair Value and Gross Unrealized Loss by Length of Time
The following tables summarize the aggregate fair value and gross unrealized loss by length of time of those investments that have been in a continuous unrealized loss position at December 31, 2022 and 2021 (in thousands).
 December 31, 2022
 Less Than 12 Months12 Months or LongerTotal
 Fair
Value		Unrealized
Loss		Fair
Value		Unrealized
Loss		Fair
Value		Unrealized
Loss
Available-for-sale securities
Treasury bills$1,594 $(2)$— $— $1,594 $(2)
Municipal bonds2,506 (641)1,246 (388)3,752 (1,029)
Agency mortgage-backed securities2,666 (314)292 (86)2,958 (400)
Total available-for-sale securities$6,766 $(957)$1,538 $(474)$8,304 $(1,431)
Held-to-maturity securities
Municipal bonds$536 $(169)$— $— $536 $(169)
Agency mortgage-backed securities1,274 (219)— — 1,274 (219)
Total held-to-maturity securities$1,810 $(388)$— $— $1,810 $(388)
 December 31, 2021
 Less Than 12 Months12 Months or LongerTotal
 Fair
Value		Unrealized
Loss		Fair
Value		Unrealized
Loss		Fair
Value		Unrealized
Loss
Municipal bonds$1,632 $(13)$— $— $1,632 $(13)
Agency mortgage-backed securities— — 402 (12)402 (12)
Total$1,632 $(13)$402 $(12)$2,034 $(25)
v3.22.4
Loans (Tables)
 12 Months Ended
Dec. 31, 2022
Receivables [Abstract]  
Schedule of Composition of the Loan Portfolio, Excluding Loans Held-for-sale
The composition of the loan portfolio, excluding loans held-for-sale, at December 31, 2022 and 2021 is as follows (in thousands):
December 31,
20222021
Real estate loans:
One-to-four family$274,638 $207,660 
Home equity19,548 13,250 
Commercial and multifamily313,358 278,175 
Construction and land116,878 63,105 
Total real estate loans724,422 562,190 
Consumer loans:
Manufactured homes26,953 21,636 
Floating homes74,443 59,268 
Other consumer17,923 16,748 
Total consumer loans119,319 97,652 
Commercial business loans23,815 28,026 
Total loans867,556 687,868 
Premiums for purchased loans(1)
973 897 
Deferred fees(2,548)(2,367)
Total loans, gross865,981 686,398 
Allowance for loan losses(7,599)(6,306)
Total loans, net$858,382 $680,092 
(1)Includes premiums resulting from purchased loans of $507 thousand related to one-to-four family loans, $320 thousand related to commercial and multifamily loans, and $146 thousand related to commercial business loans as of December 31, 2022. Includes premiums resulting from purchased loans of $556 thousand related to one-to-four family loans, $181 thousand related to commercial and multifamily loans, and $160 thousand related to commercial business loans as of December 31, 2021.
Schedule of Allowance For Loan Losses and Unpaid Principal Balance in Loans
The following table presents the balance in the allowance for loan losses and the unpaid principal balance in loans, net of partial charge-offs by portfolio segment and based on impairment method at December 31, 2022 and 2021 (in thousands):
December 31, 2022
 Allowance: Individually Evaluated for ImpairmentAllowance: Collectively Evaluated for ImpairmentEnding BalanceLoans Held for Investment: Individually Evaluated for ImpairmentLoans Held for Investment: Collectively Evaluated for ImpairmentEnding Balance
One-to-four family$102 $1,669 $1,771 $3,746 $270,892 $274,638 
Home equity5 127 132 210 19,338 19,548 
Commercial and multifamily— 2,501 2,501 — 313,358 313,358 
Construction and land3 1,206 1,209 358 116,520 116,878 
Manufactured homes52 410 462 187 26,766 26,953 
Floating homes— 456 456 — 74,443 74,443 
Other consumer22 302 324 343 17,580 17,923 
Commercial business— 256 256 — 23,815 23,815 
Unallocated— 488 488 — — — 
Total$184 $7,415 $7,599 $4,844 $862,712 $867,556 
December 31, 2021
 Allowance: Individually Evaluated for ImpairmentAllowance: Collectively Evaluated for ImpairmentEnding BalanceLoans Held for Investment: Individually Evaluated for ImpairmentLoans Held for Investment: Collectively Evaluated for ImpairmentEnding Balance
One-to-four family$112 $1,290 $1,402 $4,066 $203,594 $207,660 
Home equity7 86 93 215 13,035 13,250 
Commercial and multifamily— 2,340 2,340 2,380 275,795 278,175 
Construction and land4 646 650 68 63,037 63,105 
Manufactured homes144 331 475 221 21,415 21,636 
Floating homes— 372 372 493 58,775 59,268 
Other consumer26 284 310 106 16,642 16,748 
Commercial business— 269 269 176 27,850 28,026 
Unallocated— 395 395 — — — 
Total$293 $6,013 $6,306 $7,725 $680,143 $687,868 
The following tables summarize the activity in the allowance for loan losses for the years ended December 31, 2022 and 2021 (in thousands):
Year ended December 31, 2022
Beginning
Allowance		Charge-offsRecoveriesProvision/(Recapture)Ending
Allowance
One-to-four family$1,402 $— $99 $270 $1,771 
Home equity93 — 58 (19)132 
Commercial and multifamily2,340 — — 161 2,501 
Construction and land650 — — 559 1,209 
Manufactured homes475 — 12 (25)462 
Floating homes372 — — 84 456 
Other consumer310 (118)17 115 324 
Commercial business269 (6)6 (13)256 
Unallocated395 — — 93 488 
$6,306 $(124)$192 $1,225 $7,599 
Year ended December 31, 2021
 Beginning
Allowance		Charge-offsRecoveriesProvision/(Recapture)Ending
Allowance
One-to-four family$1,063 $(76)$— $415 $1,402 
Home equity147 (8)6 (52)93 
Commercial and multifamily2,370 — — (30)2,340 
Construction and land578 — — 72 650 
Manufactured homes529 (2)3 (55)475 
Floating homes328 — — 44 372 
Other consumer288 (50)6 66 310 
Commercial business291 — 2 (24)269 
Unallocated406 — — (11)395 
 $6,000 $(136)$17 $425 $6,306 
Schedule of Credit Quality Indicators
The following tables represent the internally assigned grades at December 31, 2022 and 2021, by type of loan (in thousands):
December 31, 2022
One-to-four
Family		Home
Equity		Commercial
and Multifamily		Construction
and Land		Manufactured
Homes		Floating
Homes		Other
Consumer		Commercial
Business		Total
Grade:
Pass$271,295 $19,230 $291,677 $109,484 $26,583 $74,443 $17,661 $22,853 $833,226 
Watch279 2 7,538 4,037 134 — — 161 12,151 
Special Mention— — 4,096 — — — — — 4,096 
Substandard3,064 316 10,047 3,357 236 — 262 801 18,083 
Total$274,638 $19,548 $313,358 $116,878 $26,953 $74,443 $17,923 $23,815 $867,556 
December 31, 2021
One-to-four
Family		Home
Equity		Commercial
and Multifamily		Construction
and Land		Manufactured
Homes		Floating
Homes		Other
Consumer		Commercial
Business		Total
Grade:
Pass$203,883 $12,904 $233,300 $56,310 $21,137 $58,171 $16,728 $23,713 $626,146 
Watch363 23 32,770 4,347 305 — — 3,561 41,369 
Special Mention— — 4,553 830 — 604 — 211 6,198 
Substandard3,414 323 7,552 1,618 194 493 20 541 14,155 
Total$207,660 $13,250 $278,175 $63,105 $21,636 $59,268 $16,748 $28,026 $687,868 
Schedule of Investment in Nonaccrual Loans
The following table presents the recorded investment in nonaccrual loans at December 31, 2022 and 2021, by type of loan (in thousands):
December 31,
 20222021
One-to-four family$2,135 $2,207 
Home equity142 140 
Commercial and multifamily— 2,380 
Construction and land324 33 
Manufactured homes96 122 
Floating homes— 493 
Other consumer262 — 
Commercial business— 176 
Total$2,959 $5,552 
Summary of Recorded Investment Aging In Past Due Loans
The following table represents the aging of the recorded investment in past due loans at December 31, 2022, by type of loan (in thousands):
 30-59 Days
Past Due		60-89 Days
Past Due		Greater than 90
Days Past Due		Recorded Investment
> 90 Days and Accruing		Total
Past Due		CurrentTotal
Loans
One-to-four family$393 $289 $1,934 $— $2,616 $272,022 $274,638 
Home equity115 — 116 — 231 19,317 19,548 
Commercial and multifamily7,198 — — — 7,198 306,160 313,358 
Construction and land1,210 — 296 — 1,506 115,372 116,878 
Manufactured homes261 155 52 — 468 26,485 26,953 
Floating homes— — — — — 74,443 74,443 
Other consumer360 5 — — 365 17,558 17,923 
Commercial business4 — — — 4 23,811 23,815 
Total$9,542 $449 $2,398 $— $12,389 $855,167 $867,556 
The following table represents the aging of the recorded investment in past due loans at December 31, 2021, by type of loan (in thousands):
 30-59 Days
Past Due		60-89 Days
Past Due		Greater Than 90
Days Past Due		Recorded Investment
> 90 Days and Accruing		Total
Past Due		CurrentTotal
Loans
One-to-four family$1,805 $58 $87 $— $1,950 $205,710 $207,660 
Home equity— — 140 — 140 13,110 13,250 
Commercial and multifamily— — — — — 278,175 278,175 
Construction and land837 — — — 837 62,268 63,105 
Manufactured homes123 — 59 — 182 21,454 21,636 
Floating homes— — 244 — 244 59,024 59,268 
Other consumer2 76 — — 78 16,670 16,748 
Commercial business6 — 176 — 182 27,844 28,026 
Total$2,773 $134 $706 $— $3,613 $684,255 $687,868 
Schedule of Credit Risk Profile Based on Payment Activity
The following table represents the credit risk profile based on payment activity as of the dates indicated, by type of loan (in thousands):
December 31, 2022
One-to-four
Family		Home
Equity		Commercial
and Multifamily		Construction
and Land		Manufactured
Homes		Floating
Homes		Other
Consumer		Commercial
Business		Total
Performing$272,503 $19,406 $313,358 $116,554 $26,857 $74,443 $17,661 $23,815 $864,597 
Nonperforming2,135 142 — 324 96 — 262 — 2,959 
Total$274,638 $19,548 $313,358 $116,878 $26,953 $74,443 $17,923 $23,815 $867,556 

December 31, 2021
 One-to-four
Family		Home
Equity		Commercial
and Multifamily		Construction
and Land		Manufactured
Homes		Floating
Homes		Other
Consumer		Commercial
Business		Total
Performing$205,453 $13,110 $275,795 $63,072 $21,514 $58,775 $16,748 $27,850 $682,316 
Nonperforming2,207 140 2,380 33 122 493 — 176 5,552 
Total$207,660 $13,250 $278,175 $63,105 $21,636 $59,268 $16,748 $28,026 $687,868 
Schedule of Impaired Loans
Impaired loans at December 31, 2022 and 2021, by type of loan were as follows (in thousands):
December 31, 2022
 Recorded Investment 
Unpaid Principal
Balance		Without
Allowance		With
Allowance		Total
Recorded
Investment		Related
Allowance
One-to-four family$3,758 $3,038 $708 $3,746 $102 
Home equity210 142 68 210 5 
Construction and land358 324 34 358 3 
Manufactured homes187 93 94 187 52 
Other consumer343 261 82 343 22 
Total$4,856 $3,858 $986 $4,844 $184 
 December 31, 2021
  Recorded Investment 
 Unpaid Principal
Balance		Without
Allowance		With
Allowance		Total
Recorded
Investment		Related
Allowance
One-to-four family$4,177 $3,109 $957 $4,066 $112 
Home equity215 140 75 215 7 
Commercial and multifamily2,380 2,380 — 2,380 — 
Construction and land68 33 35 68 4 
Manufactured homes221 44 177 221 144 
Floating homes493 493 — 493 — 
Other consumer106 — 106 106 26 
Commercial business176 176 — 176 — 
Total$7,836 $6,375 $1,350 $7,725 $293 
The following table provides the average recorded investment and interest income on impaired loans for the year ended December 31, 2022 and 2021, by type of loan (in thousands):
 
Year Ended
December 31, 2022
Year Ended
December 31, 2021
 Average
Recorded
Investment		Interest Income
Recognized		Average
Recorded
Investment		Interest Income
Recognized
One-to-four family$3,628 $106 $3,471 $198 
Home equity216 16 287 16 
Commercial and multifamily1,405 — 617 138 
Construction and land124 20 111 4 
Manufactured homes202 15 239 17 
Floating homes98 — 508 18 
Other consumer299 17 110 5 
Commercial business69 — 318 2 
Total$6,041 $174 $5,661 $398 
Schedule of Related Party Loans Director and officer loans are summarized as follows (in thousands):
 December 31,
 20222021
Balance, beginning of period$4,365 $3,995 
Advances100 — 
New / (reclassified) loans, net(822)551 
Repayments(315)(181)
Balance, end of period$3,328 $4,365 
v3.22.4
Mortgage Servicing Rights (Tables)
 12 Months Ended
Dec. 31, 2022
Transfers and Servicing [Abstract]  
Schedule of Change in the Balance of Mortgage Servicing Assets
A summary of the change in the balance of mortgage servicing assets at December 31, 2022 and 2021 were as follows (in thousands):
December 31,
20222021
Beginning balance, at fair value$4,273 $3,780 
Servicing rights that result from transfers and sale of financial assets207 1,301 
Changes in fair value:
Due to changes in model inputs or assumptions(1)
207 (808)
Ending balance, at fair value$4,687 $4,273 
(1) Includes changes due to collection/realization of expected cash flows and curtailments.
Schedule of Mortgage Service Rights Assumptions
The key economic assumptions used in determining the fair value of MSRs at December 31, 2022 and 2021 are as follows:
 December 31,
 20222021
Prepayment speed (Public Securities Association "PSA" model)132 %205 %
Weighted-average life7.5 years5.8 years
Yield to maturity discount rate12.5 %12.5 %
v3.22.4
Premises and Equipment (Tables)
 12 Months Ended
Dec. 31, 2022
Property, Plant and Equipment [Abstract]  
Schedule of Premises and Equipment
Premises and equipment at December 31, 2022 and 2021 are summarized as follows (in thousands):
 December 31,
 20222021
Land$920 $920 
Buildings and improvements7,168 7,059 
Furniture and equipment6,092 5,804 
14,180 13,783 
Less: Accumulated depreciation and amortization(8,667)(7,964)
Premises and equipment, net$5,513 $5,819 
v3.22.4
Other Real Estate Owned and Repossessed Assets (Tables)
 12 Months Ended
Dec. 31, 2022
Real Estate [Abstract]  
Schedule of Activity Related to OREO and Repossessed Assets
The following table presents activity related to OREO and other repossessed assets for the years ended December 31, 2022 and 2021 (in thousands).
 Year Ended December 31,
 20222021
Beginning balance, January 1$659 $594 
Additions to OREO and repossessed assets— 84 
Sales— (19)
Ending balance, December 31$659 $659 
v3.22.4
Deposits (Tables)
 12 Months Ended
Dec. 31, 2022
Deposits [Abstract]  
Summary of Deposits Accounts with the Corresponding Weighted Average Cost of Funds
A summary of deposit accounts with the corresponding weighted-average cost of funds at December 31, 2022 and 2021, are presented below (dollars in thousands):
 December 31, 2022December 31, 2021
 Deposit
Balance		Wtd. Avg
Rate		Deposit
Balance		Wtd. Avg
Rate
Noninterest-bearing demand$170,549 — %$187,684 — %
Interest-bearing demand254,982 0.21 307,061 0.19 
Savings95,641 0.05 103,401 0.08 
Money market74,639 0.28 91,670 0.21 
Certificates210,305 0.97 105,722 1.57 
Escrow (1)
2,647 — 2,782 — 
Total$808,763 0.37 %$798,320 0.41 %
(1)Escrow balances shown in “Noninterest-bearing deposits” on the Consolidated Balance Sheets.
Schedule of Maturities of Time Deposits
Scheduled maturities of time deposits at December 31, 2022, are as follows (in thousands):
Year Ending December 31,Amount
2023$169,273 
202433,138 
20255,042 
20262,049 
2027791 
Thereafter12 
 $210,305 
v3.22.4
Fair Value Measurements (Tables)
 12 Months Ended
Dec. 31, 2022
Fair Value Disclosures [Abstract]  
Schedule of Fair Value Hierarchy for Financial Instruments
The following tables present information about the level in the fair value hierarchy for the Company’s financial assets and liabilities, whether or not recognized or recorded at fair value, as of December 31, 2022 and 2021 (in thousands):
 December 31, 2022Fair Value Measurements Using:
 Carrying
Value		Estimated
Fair Value		Level 1Level 2Level 3
FINANCIAL ASSETS:     
Cash and cash equivalents$57,836 $57,836 $57,836 $— $— 
Available for sale securities10,207 10,207 — 10,207 — 
Held-to-maturity securities2,199 1,810 — 1,810 — 
Loans held-for-portfolio, net 858,382 801,153 — — 801,153 
Mortgage servicing rights4,687 4,687 — — 4,687 
FHLB Stock2,832 2,832 — 2,832 — 
FINANCIAL LIABILITIES:
Non-maturity deposits598,458 598,458 — 598,458 — 
Time deposits210,305 209,965 — 209,965 — 
Borrowings43,000 43,000 — 43,000 — 
Subordinated notes11,676 10,420 — 10,420 — 
 December 31, 2021Fair Value Measurements Using:
 Carrying
Value		Estimated
Fair Value		Level 1Level 2Level 3
FINANCIAL ASSETS:     
Cash and cash equivalents$183,590 $183,590 $183,590 $— $— 
Available for sale securities8,419 8,419 — 8,419 — 
Loans held-for-sale3,094 3,094 — 3,094 — 
Loans held-for-portfolio, net680,092 675,154 — — 675,154 
Mortgage servicing rights4,273 4,273 — — 4,273 
FHLB Stock1,046 1,046 — 1,046 — 
FINANCIAL LIABILITIES:
Non-maturity deposits692,598 692,598 — 692,598 — 
Time deposits105,722 106,834 — 106,834 — 
Subordinated notes11,634 11,634 — 11,634 — 
Schedule of Fair value of Assets Measured on Recurring Basis
The following tables present the balance of assets measured at fair value on a recurring basis at December 31, 2022 and 2021 (in thousands):
 Fair Value at December 31, 2022
DescriptionTotalLevel 1Level 2Level 3
Treasury bills$1,594 $— $1,594 $— 
Municipal bonds5,421 — 5,421 — 
Agency mortgage-backed securities3,192 — 3,192 — 
MSRs4,687 — — 4,687 
 Fair Value at December 31, 2021
DescriptionTotalLevel 1Level 2Level 3
Municipal bonds$6,066 $— $6,066 $— 
Agency mortgage-backed securities2,353 — 2,353 — 
MSRs4,273 — — 4,273 
Schedule of Quantitative Information
The following table provides a description of the valuation technique, unobservable input, and qualitative information about the unobservable inputs for the Company's assets and liabilities classified as Level 3 and measured at fair value on a recurring basis at December 31, 2022:
Financial
Instrument		 Valuation
Technique		 Unobservable Input(s) Range
(Weighted Average)
MSRs Discounted cash flow Prepayment speed assumption 
119%-461% (132%)
    Discount rate 
10.5%-14.5% (12.5%)
The following table provides a description of the valuation technique, unobservable input, and qualitative information about the unobservable inputs for the Company's assets and liabilities classified as Level 3 and measured at fair value on a recurring basis at December 31, 2021:
Financial
Instrument		 Valuation
Technique		 Unobservable Input(s) Range
(Weighted Average)
MSRs Discounted cash flow Prepayment speed assumption 
204%-344% (205%)
    Discount rate 
10.5%-14.5% (12.5%)
The following table provides a description of the valuation technique, observable input, and qualitative information about the unobservable inputs for the Company's assets classified as Level 3 and measured at fair value on a nonrecurring basis at December 31, 2022:
December 31, 2022
Financial
Instrument		 Valuation Technique(s) Unobservable Input(s) Range (Weighted Average)
OREO Third Party Appraisals No discounts N/A
Impaired loans(1)
 Discounted Cash FlowDiscount Rate 
0-12.75% (5%)
Impaired loans(2)
Third Party AppraisalsNo discountsN/A
(1) Represents TDRs included within impaired loans.
(2) Excludes TDRs.
December 31, 2021
Financial
Instrument		 Valuation Technique(s) Unobservable Input(s) Range
(Weighted Average)
OREO Third Party AppraisalsNo discounts N/A
Impaired loans(1)
Discounted Cash FlowDiscount Rate 
0-10% (4%)
Impaired loans(2)
Third Party AppraisalsNo discountsN/A
(1) Represents TDRs included within impaired loans.
(2) Excludes TDRs.
Schedule of Fair value of Assets Measured on Nonrecurring Basis
The following table presents the balance of assets measured at fair value on a nonrecurring basis (in thousands):
 Fair Value at December 31, 2022
DescriptionTotalLevel 1Level 2Level 3
OREO and repossessed assets$659 $— $— $659 
Impaired loans4,844 — — 4,844 
 Fair Value at December 31, 2021
DescriptionTotalLevel 1Level 2Level 3
OREO and repossessed assets$659 $— $— $659 
Impaired loans7,725 — — 7,725 
v3.22.4
Leases (Tables)
 12 Months Ended
Dec. 31, 2022
Leases [Abstract]  
Schedule of Balance Sheet Information Related to Leases
The following table represents the Consolidated Balance Sheet classification of the Company’s lease right of use assets and lease liabilities at December 31, 2022 and 2021 (in thousands):
December 31,
20222021
Operating lease right of use assets$5,102 $5,811 
Operating lease liabilities5,448 6,242 
Schedule of Components of the Leases and Supplemental Cash Flow Information
The following table represents the components of lease expense for the years ended December 31, 2022 and 2021 (in thousands):
Year Ended December 31,
20222021
Operating lease expense:
Office leases$1,119 $1,134 
Sublease income(11)(11)
Net lease expense$1,108 $1,123 
Lease term and discount rate by lease type at December 31, 2022 and 2021 consist of the following:
December 31,
20222021
Weighted-average remaining lease term:
Office leases6.1 years7.0 years
Weighted-average discount rate (annualized):
Office leases2.63 %2.67 %
Supplemental cash flow information related to leases for the years ended December 31, 2022 and 2021 was as follows (in thousands):
Year Ended December 31,
20222021
Cash paid for amounts included in the measurement of lease liabilities for operating leases:
Operating cash flows
Office leases$1,067 $1,042 
Schedule of Lease Liability Maturities
The following table represents the maturity of lease liabilities at December 31, 2022 (in thousands):
December 31, 2022
Office
Leases
Operating Lease Commitments
2022$1,051 
20231,031 
2024884 
2025864 
2026881 
Thereafter1,196 
Total lease payments5,907 
Less: Present value discount459 
Present value of lease liabilities$5,448 
v3.22.4
Earnings Per Share (Tables)
 12 Months Ended
Dec. 31, 2022
Earnings Per Share [Abstract]  
Schedule of Earnings per Common Share
Earnings per share are summarized for the years ended December 31, 2022 and 2021 as follows (in thousands, except per share data):
 Year Ended December 31,
 20222021
Net income$8,804 $9,156 
LESS: Participating dividends - Unvested RSAs(14)(14)
LESS: Income allocated to participating securities - Unvested RSAs(47)(49)
Net income available to common stockholders - basic8,743 9,093 
ADD BACK: Income allocated to participating securities - Unvested RSAs47 49 
LESS: Income reallocated to participating securities - Unvested RSAs(47)(48)
Net income available to common stockholders - diluted$8,743 $9,094 
Weighted average number of shares outstanding, basic2,578,496 2,582,775 
Effect of potentially dilutive common shares34,918 43,741 
Weighted average number of shares outstanding, diluted2,613,414 2,626,516 
Earnings per share, basic$3.39 $3.52 
Earnings per share, diluted$3.35 $3.46 
v3.22.4
Employee Benefits (Tables)
 12 Months Ended
Dec. 31, 2022
Share-Based Payment Arrangement [Abstract]  
Schedule of Stock Option Plan Award Activity
The following is a summary of the Company's stock option plan award activity during the period ended December 31, 2022:
 SharesWeighted-Average
Exercise Price		Weighted-Average
Remaining Contractual
Term In Years		Aggregate
Intrinsic Value
Outstanding at January 1, 2022
91,316 $24.59 4.77$1,772,667 
Granted12,800 42.85 
Exercised(11,421)19.52 
Forfeited(918)34.92 
Expired(252)35.13 
Outstanding at December 31, 2022
91,525 27.64 4.651,109,392 
Exercisable70,559 24.57 3.591,046,742 
Expected to vest, assuming a 0% forfeiture rate over the vesting term
91,525 $27.64 4.65$1,109,392 
Schedule of Weighted-average Assumptions Used in Determining Fair Value of Options Granted
The fair value of each option grant is estimated as of the grant date using the Black-Scholes option-pricing model. The fair value of options granted in 2022 and 2021 were determined using the following weighted-average assumptions as of the grant date.
Year Ended December 31,
 20222021
Annual dividend yield1.59 %1.60 %
Expected volatility26.48 %21.67 %
Risk-free interest rate1.64 %0.60 %
Expected term6.00 years6.50 years
Weighted-average grant date fair value per option granted$9.95 $5.64 
Schedule of Nonvested Restricted Stock Awards
The following is a summary of the Company's non-vested restricted stock awards for the year ended December 31, 2022:
Non-vested SharesSharesWeighted-Average
Grant-Date Fair Value
Per Share		Aggregate
Intrinsic Value
Per Share
Non-vested at January 1, 2022
17,586 $34.02 
Granted9,700 42.85 
Vested(8,477)36.34 
Forfeited(930)35.58 
Expired— — 
Non-vested at December 31, 2022
17,879 37.63 $39.27 
Expected to vest assuming a 0% forfeiture rate over the vesting term
17,879 $37.63 $39.27 
v3.22.4
Income Taxes (Tables)
 12 Months Ended
Dec. 31, 2022
Income Tax Disclosure [Abstract]  
Schedule of Provision for Income Taxes
The provision for income taxes at December 31, 2022 and 2021 was as follows (in thousands):
 December 31,
 20222021
Current$2,221 $2,315 
Deferred(149)(43)
Total tax expense$2,072 $2,272 
Schedule of Reconciliation of Provision for Income Taxes
A reconciliation of the provision for income taxes for the years ended December 31, 2022 and 2021, with amounts determined by applying the statutory U.S. federal income tax rate to income before income taxes, is as follows (dollars in thousands):
 Year Ended December 31,
 20222021
Provision at statutory rate$2,282 $2,400 
Tax-exempt income(169)(203)
Other(41)75 
 $2,072 $2,272 
Federal Tax Rate21.0 %21.0 %
Tax exempt rate(1.6)(1.8)
Other(0.3)0.7 
Effective tax rate19.1 %19.9 %
Schedule of Components of Deferred Tax Assets
The following table reflects the temporary differences that gave rise to the components of the Company's deferred tax assets at December 31, 2022 and 2021 (in thousands):
 December 31,
 20222021
Deferred tax assets  
Deferred compensation and supplemental retirement$401 $381 
Equity based compensation159 120 
Intangible assets38 46 
Lease liabilities1,075 1,311 
Unrealized loss on securities297 — 
Allowance for loan losses1,596 1,324 
Other, net109 71 
Total deferred tax assets3,675 3,253 
Deferred tax liabilities
Prepaid expenses(159)(100)
FHLB stock dividends(40)(40)
Unrealized gain on securities— (37)
Depreciation(108)(165)
Mortgage servicing rights(493)(568)
Deferred loan costs(952)(739)
Right of use assets(1,056)(1,220)
Total deferred tax liabilities(2,808)(2,869)
Net deferred tax asset$867 $384 
v3.22.4
Commitments and Contingencies (Tables)
 12 Months Ended
Dec. 31, 2022
Commitments and Contingencies Disclosure [Abstract]  
Schedule of Financial Instruments whose Contract Amount Represents Credit Risk
Financial instruments whose contract amount represents credit risk were as follow (in thousands):
 December 31,
 20222021
Residential mortgage commitments$3,184 $6,663 
Unfunded construction commitments65,072 89,797 
Unused lines of credit32,793 35,036 
Irrevocable letters of credit275 151 
Total loan commitments$101,323 $131,647 
v3.22.4
Parent Company Financial Information (Tables)
 12 Months Ended
Dec. 31, 2022
Condensed Financial Information Disclosure [Abstract]  
Schedule of Balance Sheets
Balance sheetsDecember 31,
 20222021
Assets  
Cash and cash equivalents$2,152 $4,215 
Investment in Sound Community Bank107,467 100,986 
Other assets85 58 
Total assets$109,704 $105,259 
Liabilities and Stockholders' Equity
Subordinated notes, net$11,676 $11,634 
Other liabilities323 267 
Total liabilities11,999 11,901 
Stockholders' equity97,705 93,358 
Total liabilities and stockholders' equity$109,704 $105,259 
Schedule of Statements of Income
Statements of IncomeYear Ended December 31,
 20222021
Dividend from subsidiary$2,623 $— 
Interest expense on subordinated notes(672)(673)
Other expenses(715)(550)
Income (loss) before income tax benefit and equity in undistributed net income of subsidiary1,236 (1,223)
Income tax benefit306 257 
Equity in undistributed earnings of subsidiary7,232 9,690 
Net income$8,774 $8,724 
Schedule of Statements of Cash Flows
Statements of Cash FlowsYear Ended December 31,
 20222021
Cash flows from operating activities:  
Net income$8,774 $8,724 
Adjustments to reconcile net income to net cash provided by operating activities:
Other, net71 (78)
Expense allocation to holding company(134)— 
Equity in undistributed earnings of subsidiary(7,232)(9,690)
Net cash used in operating activities1,479 (1,044)
Cash flows from investing activities:
ESOP shares released— 431 
Net cash provided by investing activities— 431 
Cash flows from financing activities:
Dividends paid(2,031)(2,039)
Repurchase of stock(1,734)(152)
Stock options exercised223 182 
Net cash used in financing activities(3,542)(2,009)
Net decrease in cash(2,063)(2,622)
Cash and cash equivalents at beginning of year4,215 6,837 
Cash and cash equivalents at end of year$2,152 $4,215 
v3.22.4
Revenue from Contracts with Customers (Tables)
 12 Months Ended
Dec. 31, 2022
Revenue from Contract with Customer [Abstract]  
Schedule of Noninterest Income The following table presents the Company's sources of Noninterest Income for the year ended December 31, 2022 and 2021 (in thousands). Items outside of the scope of ASC 606 are noted as such.
Year Ended December 31,
 20222021
Noninterest income:  
Service charges and fee income
Account maintenance fees$324 $311 
Transaction-based and overdraft service charges446 356 
Debit/ATM interchange fees1,394 1,322 
Credit card interchange fees40 27 
Loan fees (a)119 178 
Other fees (a)45 53 
Total service charges and fee income2,368 2,247 
Earnings on cash surrender value of bank-owned life insurance (a)219 416 
Mortgage servicing income (a)1,242 1,284 
Fair value adjustment on MSRs (a)207 (808)
Net gain on sale of loans (a)546 4,190 
Total noninterest income$4,582 $7,329 
(a) Not within scope of ASC 606
v3.22.4
Organization and Significant Accounting Policies (Details)
 12 Months Ended
Dec. 31, 2022
USD ($)
segment
Dec. 31, 2021
USD ($)
Property, Plant and Equipment [Line Items]    
Minimum past due period after which accrual of interest is discontinued 90 days  
Loans charge off period, maximum 120 days  
Period of consecutive monthly loan payments for loan to return to accrual status 6 months  
Minimum required investment in Federal Home Loan Bank Stock $ 2,800,000 $ 1,000,000
Number of operating segments | segment 1  
Allowance for off-balance sheet credit commitments $ 336,000 405,000
Advertising costs $ 390,000 415,000
Minimum | Furniture and equipment    
Property, Plant and Equipment [Line Items]    
Useful life 1 year  
Maximum | Furniture and equipment    
Property, Plant and Equipment [Line Items]    
Useful life 10 years  
Maximum | Building    
Property, Plant and Equipment [Line Items]    
Useful life 39 years  
Core Deposits    
Property, Plant and Equipment [Line Items]    
Intangible asset $ 67,000 97,000
Remaining weighted average life 2 years 3 months 18 days  
Impairment loss on intangible assets $ 0 $ 0
Core Deposits | Minimum    
Property, Plant and Equipment [Line Items]    
Amortization period 8 years  
Core Deposits | Maximum    
Property, Plant and Equipment [Line Items]    
Amortization period 10 years  
v3.22.4
Investments -Schedule of Amortized Cost and Fair Value of AFS Securities (Details) - USD ($)
$ in Thousands
Dec. 31, 2022
Dec. 31, 2021
Debt Securities, Available-for-sale [Line Items]    
Amortized Cost $ 11,621 $ 8,243
Gross Unrealized Gains 17 201
Gross Unrealized Losses (1,431) (25)
Available-for-sale securities, at fair value 10,207 8,419
Treasury bills    
Debt Securities, Available-for-sale [Line Items]    
Amortized Cost 1,596  
Gross Unrealized Gains 0  
Gross Unrealized Losses (2)  
Available-for-sale securities, at fair value 1,594  
Municipal bonds    
Debt Securities, Available-for-sale [Line Items]    
Amortized Cost 6,434 5,931
Gross Unrealized Gains 16 148
Gross Unrealized Losses (1,029) (13)
Available-for-sale securities, at fair value 5,421 6,066
Agency mortgage-backed securities    
Debt Securities, Available-for-sale [Line Items]    
Amortized Cost 3,591 2,312
Gross Unrealized Gains 1 53
Gross Unrealized Losses (400) (12)
Available-for-sale securities, at fair value $ 3,192 $ 2,353
v3.22.4
Investments - Schedule of Amortized Cost and Fair Value of HTM Securities (Details)
$ in Thousands
Dec. 31, 2022
USD ($)
Schedule of Held-to-maturity Securities [Line Items]  
Amortized Cost $ 2,199
Gross Unrealized Gains 0
Gross Unrealized Losses (388)
Estimated Fair Value 1,810
Municipal bonds  
Schedule of Held-to-maturity Securities [Line Items]  
Amortized Cost 705
Gross Unrealized Gains 0
Gross Unrealized Losses (169)
Estimated Fair Value 536
Agency mortgage-backed securities  
Schedule of Held-to-maturity Securities [Line Items]  
Amortized Cost 1,494
Gross Unrealized Gains 0
Gross Unrealized Losses (219)
Estimated Fair Value $ 1,274
v3.22.4
Investments -Schedule of Amortized Cost and Fair Value of Mortgage-backed Securities by Contractual Maturity (Details) - USD ($)
$ in Thousands
Dec. 31, 2022
Dec. 31, 2021
Amortized Cost    
Due within one year $ 1,596  
Due in one to five years 151  
Due after five to ten years 1,226  
Due after ten years 5,057  
Mortgage-backed securities 3,591  
Amortized Cost 11,621 $ 8,243
Fair Value    
Due within one year 1,594  
Due in one to five years 151  
Due after five to ten years 1,235  
Due after ten years 4,035  
Mortgage-backed securities 3,192  
Total $ 10,207 8,419
Weighted-Average Yield    
Due within one year 2.86%  
Due in one to five years 3.57%  
Due after five to ten years 5.26%  
Due after ten years 2.73%  
Mortgage-backed securities 3.07%  
Total 3.14%  
Amortized Cost    
Due within one year $ 0  
Due in one to five years 0  
Due after five to ten years 0  
Due after ten years 705  
Mortgage-backed securities 1,494  
Total 2,199 $ 0
Fair Value    
Due within one year 0  
Due in one to five years 0  
Due after five to ten years 0  
Due after ten years 536  
Mortgage-backed securities 1,274  
Total $ 1,810  
Weighted-Average Yield    
Due within one year 0.00%  
Due in one to five years 0.00%  
Due after five to ten years 0.00%  
Due after ten years 3.04%  
Mortgage-backed securities 2.51%  
Total 2.68%  
v3.22.4
Investments - Narrative (Details)
 12 Months Ended
Dec. 31, 2022
USD ($)
security
Dec. 31, 2021
USD ($)
security
Debt Securities, Available-for-sale [Line Items]    
Pledged securities $ 0 $ 0
Sale of AFS securities 0 0
Proceeds from principal payments, maturities and sales of HTM securities 0  
Debt securities, available-for-sale, allowance for credit loss $ 0 $ 0
Number of securities in unrealized loss position for less than 12 months | security 16 2
Number of securities in unrealized loss position for more than 12 months | security 3 1
Treasury bills    
Debt Securities, Available-for-sale [Line Items]    
Number of portfolio securities | security 1  
Agency mortgage-backed securities    
Debt Securities, Available-for-sale [Line Items]    
Number of portfolio securities | security 12 10
Investments $ 12,000,000  
Municipal bonds    
Debt Securities, Available-for-sale [Line Items]    
Number of portfolio securities | security 11 10
Investments   $ 8,400,000
v3.22.4
Investments -Summary of Aggregate Fair Value and Gross Unrealized Loss by Length of Time (Details) - USD ($)
$ in Thousands
Dec. 31, 2022
Dec. 31, 2021
Fair Value    
Less Than 12 Months $ 6,766 $ 1,632
12 Months or Longer 1,538 402
Total 8,304 2,034
Unrealized Loss    
Less Than 12 Months (957) (13)
12 Months or Longer (474) (12)
Total (1,431) (25)
Fair Value    
Less Than 12 Months 1,810  
12 Months or Longer 0  
Total 1,810  
Unrealized Loss    
Less Than 12 Months (388)  
12 Months or Longer 0  
Total (388)  
Treasury bills    
Fair Value    
Less Than 12 Months 1,594  
12 Months or Longer 0  
Total 1,594  
Unrealized Loss    
Less Than 12 Months (2)  
12 Months or Longer 0  
Total (2)  
Municipal bonds    
Fair Value    
Less Than 12 Months 2,506 1,632
12 Months or Longer 1,246 0
Total 3,752 1,632
Unrealized Loss    
Less Than 12 Months (641) (13)
12 Months or Longer (388) 0
Total (1,029) (13)
Fair Value    
Less Than 12 Months 536  
12 Months or Longer 0  
Total 536  
Unrealized Loss    
Less Than 12 Months (169)  
12 Months or Longer 0  
Total (169)  
Agency mortgage-backed securities    
Fair Value    
Less Than 12 Months 2,666 0
12 Months or Longer 292 402
Total 2,958 402
Unrealized Loss    
Less Than 12 Months (314) 0
12 Months or Longer (86) (12)
Total (400) $ (12)
Fair Value    
Less Than 12 Months 1,274  
12 Months or Longer 0  
Total 1,274  
Unrealized Loss    
Less Than 12 Months (219)  
12 Months or Longer 0  
Total $ (219)  
v3.22.4
Loans - Composition of the Loan Portfolio, Excluding Loans Held-for-sale (Details) - USD ($)
$ in Thousands
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Accounts, Notes, Loans and Financing Receivable [Line Items]      
Total loans $ 867,556 $ 687,868  
Premiums for purchased loans 973 897  
Deferred fees (2,548) (2,367)  
Total loans, gross 865,981 686,398  
Allowance for loan losses (7,599) (6,306) $ (6,000)
Total loans held-for-portfolio, net 858,382 680,092  
PPP loans      
Accounts, Notes, Loans and Financing Receivable [Line Items]      
Total loans 17 4,200  
Amount of loans funded 119,200    
Real estate loans:      
Accounts, Notes, Loans and Financing Receivable [Line Items]      
Total loans 724,422 562,190  
Real estate loans: | One-to-four family      
Accounts, Notes, Loans and Financing Receivable [Line Items]      
Total loans 274,638 207,660  
Premiums for purchased loans (507) 556  
Allowance for loan losses (1,771) (1,402) (1,063)
Real estate loans: | Home equity      
Accounts, Notes, Loans and Financing Receivable [Line Items]      
Total loans 19,548 13,250  
Allowance for loan losses (132) (93) (147)
Real estate loans: | Commercial and multifamily      
Accounts, Notes, Loans and Financing Receivable [Line Items]      
Total loans 313,358 278,175  
Premiums for purchased loans (320) 181  
Allowance for loan losses (2,501) (2,340) (2,370)
Real estate loans: | Construction and land      
Accounts, Notes, Loans and Financing Receivable [Line Items]      
Total loans 116,878 63,105  
Allowance for loan losses (1,209) (650) (578)
Consumer loans:      
Accounts, Notes, Loans and Financing Receivable [Line Items]      
Total loans 119,319 97,652  
Consumer loans: | Manufactured homes      
Accounts, Notes, Loans and Financing Receivable [Line Items]      
Total loans 26,953 21,636  
Allowance for loan losses (462) (475) (529)
Consumer loans: | Floating homes      
Accounts, Notes, Loans and Financing Receivable [Line Items]      
Total loans 74,443 59,268  
Allowance for loan losses (456) (372) (328)
Consumer loans: | Other consumer      
Accounts, Notes, Loans and Financing Receivable [Line Items]      
Total loans 17,923 16,748  
Allowance for loan losses (324) (310) (288)
Commercial business loans      
Accounts, Notes, Loans and Financing Receivable [Line Items]      
Total loans 23,815 28,026  
Premiums for purchased loans (146) 160  
Allowance for loan losses $ (256) $ (269) $ (291)
v3.22.4
Loans - Narrative (Details)
$ in Thousands
 12 Months Ended
Dec. 31, 2022
USD ($)
loan
Dec. 31, 2021
USD ($)
loan
Accounts, Notes, Loans and Financing Receivable [Line Items]    
Total loans $ 867,556 $ 687,868
Forgone interest on nonaccrual loans 174 138
Loans classified as TDRs $ 2,000 $ 2,600
Number of contracts | loan 2  
Total modifications $ 155  
Number of loans for which there was payment default within first 12 months of modification | loan 0 0
Discount on market loan rate for consumer loans to employees and officers 1.00%  
Real estate secured loans with current loan-to-value ratios above supervisory guidelines $ 16,400 $ 7,300
Performing    
Accounts, Notes, Loans and Financing Receivable [Line Items]    
Total loans $ 864,597 682,316
Minimum    
Accounts, Notes, Loans and Financing Receivable [Line Items]    
Annual adjustable rate over rolling cost of funds 1.00%  
Maximum    
Accounts, Notes, Loans and Financing Receivable [Line Items]    
Period past due for loans to be automatically placed on nonaccrual 90 days  
Annual adjustable rate over rolling cost of funds 1.50%  
Commercial business loans    
Accounts, Notes, Loans and Financing Receivable [Line Items]    
Total loans $ 23,815 28,026
Loans purchased $ 2,600 $ 4,300
Number of contracts paid off during the period | loan 1  
TDR loans paid off during the period $ 176  
Number of TDR loans charged off | loan 0 1
TDR charged off   $ 45
Commercial business loans | Performing    
Accounts, Notes, Loans and Financing Receivable [Line Items]    
Total loans $ 23,815 27,850
Consumer loans:    
Accounts, Notes, Loans and Financing Receivable [Line Items]    
Total loans $ 119,319 97,652
Number of contracts paid off during the period | loan 1  
TDR loans paid off during the period $ 17  
Consumer loans: | Manufactured homes    
Accounts, Notes, Loans and Financing Receivable [Line Items]    
Total loans $ 26,953 21,636
Number of contracts paid off during the period | loan 1  
TDR loans paid off during the period $ 15  
Consumer loans: | Manufactured homes | Performing    
Accounts, Notes, Loans and Financing Receivable [Line Items]    
Total loans 26,857 21,514
Real estate loans:    
Accounts, Notes, Loans and Financing Receivable [Line Items]    
Total loans 724,422 562,190
Real estate loans: | One-to-four family    
Accounts, Notes, Loans and Financing Receivable [Line Items]    
Total loans $ 274,638 207,660
Loans purchased   24,100
Number of contracts paid off during the period | loan 2  
TDR loans paid off during the period $ 597  
Real estate loans: | One-to-four family | Performing    
Accounts, Notes, Loans and Financing Receivable [Line Items]    
Total loans 272,503 205,453
PPP loans    
Accounts, Notes, Loans and Financing Receivable [Line Items]    
Amount of loans funded 119,200  
Total loans $ 17 $ 4,200
v3.22.4
Loans -Schedule of Allowance For Loan Losses and Unpaid Principal Balance in Loans (Details) - USD ($)
$ in Thousands
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Allowance for loan losses      
Allowance: Individually Evaluated for Impairment $ 184 $ 293  
Allowance: Collectively Evaluated for Impairment 7,415 6,013  
Ending Balance 7,599 6,306 $ 6,000
Loans held for investment      
Loans Held for Investment: Individually Evaluated for Impairment 4,844 7,725  
Loans Held for Investment: Collectively Evaluated for Impairment 862,712 680,143  
Ending Balance 867,556 687,868  
Real estate loans:      
Loans held for investment      
Ending Balance 724,422 562,190  
Consumer loans:      
Loans held for investment      
Ending Balance 119,319 97,652  
Commercial business loans      
Allowance for loan losses      
Allowance: Individually Evaluated for Impairment 0 0  
Allowance: Collectively Evaluated for Impairment 256 269  
Ending Balance 256 269 291
Loans held for investment      
Loans Held for Investment: Individually Evaluated for Impairment 0 176  
Loans Held for Investment: Collectively Evaluated for Impairment 23,815 27,850  
Ending Balance 23,815 28,026  
Unallocated      
Allowance for loan losses      
Allowance: Individually Evaluated for Impairment 0 0  
Allowance: Collectively Evaluated for Impairment 488 395  
Ending Balance 488 395 406
Loans held for investment      
Loans Held for Investment: Individually Evaluated for Impairment 0 0  
Loans Held for Investment: Collectively Evaluated for Impairment 0 0  
Ending Balance 0 0  
One-to-four family | Real estate loans:      
Allowance for loan losses      
Allowance: Individually Evaluated for Impairment 102 112  
Allowance: Collectively Evaluated for Impairment 1,669 1,290  
Ending Balance 1,771 1,402 1,063
Loans held for investment      
Loans Held for Investment: Individually Evaluated for Impairment 3,746 4,066  
Loans Held for Investment: Collectively Evaluated for Impairment 270,892 203,594  
Ending Balance 274,638 207,660  
Home equity | Real estate loans:      
Allowance for loan losses      
Allowance: Individually Evaluated for Impairment 5 7  
Allowance: Collectively Evaluated for Impairment 127 86  
Ending Balance 132 93 147
Loans held for investment      
Loans Held for Investment: Individually Evaluated for Impairment 210 215  
Loans Held for Investment: Collectively Evaluated for Impairment 19,338 13,035  
Ending Balance 19,548 13,250  
Commercial and multifamily | Real estate loans:      
Allowance for loan losses      
Allowance: Individually Evaluated for Impairment 0 0  
Allowance: Collectively Evaluated for Impairment 2,501 2,340  
Ending Balance 2,501 2,340 2,370
Loans held for investment      
Loans Held for Investment: Individually Evaluated for Impairment 0 2,380  
Loans Held for Investment: Collectively Evaluated for Impairment 313,358 275,795  
Ending Balance 313,358 278,175  
Construction and land | Real estate loans:      
Allowance for loan losses      
Allowance: Individually Evaluated for Impairment 3 4  
Allowance: Collectively Evaluated for Impairment 1,206 646  
Ending Balance 1,209 650 578
Loans held for investment      
Loans Held for Investment: Individually Evaluated for Impairment 358 68  
Loans Held for Investment: Collectively Evaluated for Impairment 116,520 63,037  
Ending Balance 116,878 63,105  
Manufactured homes | Consumer loans:      
Allowance for loan losses      
Allowance: Individually Evaluated for Impairment 52 144  
Allowance: Collectively Evaluated for Impairment 410 331  
Ending Balance 462 475 529
Loans held for investment      
Loans Held for Investment: Individually Evaluated for Impairment 187 221  
Loans Held for Investment: Collectively Evaluated for Impairment 26,766 21,415  
Ending Balance 26,953 21,636  
Floating homes | Consumer loans:      
Allowance for loan losses      
Allowance: Individually Evaluated for Impairment 0 0  
Allowance: Collectively Evaluated for Impairment 456 372  
Ending Balance 456 372 328
Loans held for investment      
Loans Held for Investment: Individually Evaluated for Impairment 0 493  
Loans Held for Investment: Collectively Evaluated for Impairment 74,443 58,775  
Ending Balance 74,443 59,268  
Other consumer | Consumer loans:      
Allowance for loan losses      
Allowance: Individually Evaluated for Impairment 22 26  
Allowance: Collectively Evaluated for Impairment 302 284  
Ending Balance 324 310 $ 288
Loans held for investment      
Loans Held for Investment: Individually Evaluated for Impairment 343 106  
Loans Held for Investment: Collectively Evaluated for Impairment 17,580 16,642  
Ending Balance $ 17,923 $ 16,748  
v3.22.4
Loans -Summary of Activity in Allowance for Loan Losses (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Financing Receivable, Excluding Accrued Interest, Allowance for Credit Loss [Roll Forward]    
Beginning Allowance $ 6,306 $ 6,000
Charge-offs (124) (136)
Recoveries 192 17
Provision/(Recapture) 1,225 425
Ending Allowance 7,599 6,306
Real estate loans: | One-to-four family    
Financing Receivable, Excluding Accrued Interest, Allowance for Credit Loss [Roll Forward]    
Beginning Allowance 1,402 1,063
Charge-offs 0 (76)
Recoveries 99 0
Provision/(Recapture) 270 415
Ending Allowance 1,771 1,402
Real estate loans: | Home equity    
Financing Receivable, Excluding Accrued Interest, Allowance for Credit Loss [Roll Forward]    
Beginning Allowance 93 147
Charge-offs 0 (8)
Recoveries 58 6
Provision/(Recapture) (19) (52)
Ending Allowance 132 93
Real estate loans: | Commercial and multifamily    
Financing Receivable, Excluding Accrued Interest, Allowance for Credit Loss [Roll Forward]    
Beginning Allowance 2,340 2,370
Charge-offs 0 0
Recoveries 0 0
Provision/(Recapture) 161 (30)
Ending Allowance 2,501 2,340
Real estate loans: | Construction and land    
Financing Receivable, Excluding Accrued Interest, Allowance for Credit Loss [Roll Forward]    
Beginning Allowance 650 578
Charge-offs 0 0
Recoveries 0 0
Provision/(Recapture) 559 72
Ending Allowance 1,209 650
Consumer loans: | Manufactured homes    
Financing Receivable, Excluding Accrued Interest, Allowance for Credit Loss [Roll Forward]    
Beginning Allowance 475 529
Charge-offs 0 (2)
Recoveries 12 3
Provision/(Recapture) (25) (55)
Ending Allowance 462 475
Consumer loans: | Floating homes    
Financing Receivable, Excluding Accrued Interest, Allowance for Credit Loss [Roll Forward]    
Beginning Allowance 372 328
Charge-offs 0 0
Recoveries 0 0
Provision/(Recapture) 84 44
Ending Allowance 456 372
Consumer loans: | Other consumer    
Financing Receivable, Excluding Accrued Interest, Allowance for Credit Loss [Roll Forward]    
Beginning Allowance 310 288
Charge-offs (118) (50)
Recoveries 17 6
Provision/(Recapture) 115 66
Ending Allowance 324 310
Commercial business    
Financing Receivable, Excluding Accrued Interest, Allowance for Credit Loss [Roll Forward]    
Beginning Allowance 269 291
Charge-offs (6) 0
Recoveries 6 2
Provision/(Recapture) (13) (24)
Ending Allowance 256 269
Unallocated    
Financing Receivable, Excluding Accrued Interest, Allowance for Credit Loss [Roll Forward]    
Beginning Allowance 395 406
Charge-offs 0 0
Recoveries 0 0
Provision/(Recapture) 93 (11)
Ending Allowance $ 488 $ 395
v3.22.4
Loans -Schedule of Credit Quality Indicators (Details) - USD ($)
$ in Thousands
Dec. 31, 2022
Dec. 31, 2021
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans $ 867,556 $ 687,868
Pass    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 833,226 626,146
Watch    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 12,151 41,369
Special Mention    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 4,096 6,198
Substandard    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 18,083 14,155
Real estate loans:    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 724,422 562,190
Real estate loans: | One-to-four Family    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 274,638 207,660
Real estate loans: | One-to-four Family | Pass    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 271,295 203,883
Real estate loans: | One-to-four Family | Watch    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 279 363
Real estate loans: | One-to-four Family | Special Mention    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 0 0
Real estate loans: | One-to-four Family | Substandard    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 3,064 3,414
Real estate loans: | Home Equity    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 19,548 13,250
Real estate loans: | Home Equity | Pass    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 19,230 12,904
Real estate loans: | Home Equity | Watch    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 2 23
Real estate loans: | Home Equity | Special Mention    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 0 0
Real estate loans: | Home Equity | Substandard    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 316 323
Real estate loans: | Commercial and Multifamily    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 313,358 278,175
Real estate loans: | Commercial and Multifamily | Pass    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 291,677 233,300
Real estate loans: | Commercial and Multifamily | Watch    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 7,538 32,770
Real estate loans: | Commercial and Multifamily | Special Mention    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 4,096 4,553
Real estate loans: | Commercial and Multifamily | Substandard    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 10,047 7,552
Real estate loans: | Construction and Land    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 116,878 63,105
Real estate loans: | Construction and Land | Pass    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 109,484 56,310
Real estate loans: | Construction and Land | Watch    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 4,037 4,347
Real estate loans: | Construction and Land | Special Mention    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 0 830
Real estate loans: | Construction and Land | Substandard    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 3,357 1,618
Consumer loans:    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 119,319 97,652
Consumer loans: | Manufactured Homes    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 26,953 21,636
Consumer loans: | Manufactured Homes | Pass    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 26,583 21,137
Consumer loans: | Manufactured Homes | Watch    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 134 305
Consumer loans: | Manufactured Homes | Special Mention    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 0 0
Consumer loans: | Manufactured Homes | Substandard    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 236 194
Consumer loans: | Floating Homes    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 74,443 59,268
Consumer loans: | Floating Homes | Pass    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 74,443 58,171
Consumer loans: | Floating Homes | Watch    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 0 0
Consumer loans: | Floating Homes | Special Mention    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 0 604
Consumer loans: | Floating Homes | Substandard    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 0 493
Consumer loans: | Other Consumer    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 17,923 16,748
Consumer loans: | Other Consumer | Pass    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 17,661 16,728
Consumer loans: | Other Consumer | Watch    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 0 0
Consumer loans: | Other Consumer | Special Mention    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 0 0
Consumer loans: | Other Consumer | Substandard    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 262 20
Commercial business    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 23,815 28,026
Commercial business | Pass    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 22,853 23,713
Commercial business | Watch    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 161 3,561
Commercial business | Special Mention    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 0 211
Commercial business | Substandard    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans $ 801 $ 541
v3.22.4
Loans -Schedule of Investment in Nonaccrual Loans (Details) - USD ($)
$ in Thousands
Dec. 31, 2022
Dec. 31, 2021
Financing Receivable, Past Due [Line Items]    
Nonaccrual loans $ 2,959 $ 5,552
Real estate loans: | One-to-four family    
Financing Receivable, Past Due [Line Items]    
Nonaccrual loans 2,135 2,207
Real estate loans: | Home equity    
Financing Receivable, Past Due [Line Items]    
Nonaccrual loans 142 140
Real estate loans: | Commercial and multifamily    
Financing Receivable, Past Due [Line Items]    
Nonaccrual loans 0 2,380
Real estate loans: | Construction and land    
Financing Receivable, Past Due [Line Items]    
Nonaccrual loans 324 33
Consumer loans: | Manufactured homes    
Financing Receivable, Past Due [Line Items]    
Nonaccrual loans 96 122
Consumer loans: | Floating homes    
Financing Receivable, Past Due [Line Items]    
Nonaccrual loans 0 493
Consumer loans: | Other consumer    
Financing Receivable, Past Due [Line Items]    
Nonaccrual loans 262 0
Commercial business    
Financing Receivable, Past Due [Line Items]    
Nonaccrual loans $ 0 $ 176
v3.22.4
Loans -Summary of Recorded Investment Aging In Past Due Loans (Details) - USD ($)
$ in Thousands
Dec. 31, 2022
Dec. 31, 2021
Financing Receivable, Past Due [Line Items]    
Total Loans $ 867,556 $ 687,868
30-59 Days Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 9,542 2,773
60-89 Days Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 449 134
Greater than 90 Days Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 2,398 706
Recorded Investment > 90 Days and Accruing 0 0
Total Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 12,389 3,613
Current    
Financing Receivable, Past Due [Line Items]    
Total Loans 855,167 684,255
Real estate loans: | One-to-four family    
Financing Receivable, Past Due [Line Items]    
Total Loans 274,638 207,660
Real estate loans: | One-to-four family | 30-59 Days Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 393 1,805
Real estate loans: | One-to-four family | 60-89 Days Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 289 58
Real estate loans: | One-to-four family | Greater than 90 Days Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 1,934 87
Recorded Investment > 90 Days and Accruing 0 0
Real estate loans: | One-to-four family | Total Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 2,616 1,950
Real estate loans: | One-to-four family | Current    
Financing Receivable, Past Due [Line Items]    
Total Loans 272,022 205,710
Real estate loans: | Home equity    
Financing Receivable, Past Due [Line Items]    
Total Loans 19,548 13,250
Real estate loans: | Home equity | 30-59 Days Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 115 0
Real estate loans: | Home equity | 60-89 Days Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 0 0
Real estate loans: | Home equity | Greater than 90 Days Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 116 140
Recorded Investment > 90 Days and Accruing 0 0
Real estate loans: | Home equity | Total Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 231 140
Real estate loans: | Home equity | Current    
Financing Receivable, Past Due [Line Items]    
Total Loans 19,317 13,110
Real estate loans: | Commercial and multifamily    
Financing Receivable, Past Due [Line Items]    
Total Loans 313,358 278,175
Real estate loans: | Commercial and multifamily | 30-59 Days Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 7,198 0
Real estate loans: | Commercial and multifamily | 60-89 Days Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 0 0
Real estate loans: | Commercial and multifamily | Greater than 90 Days Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 0 0
Recorded Investment > 90 Days and Accruing 0 0
Real estate loans: | Commercial and multifamily | Total Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 7,198 0
Real estate loans: | Commercial and multifamily | Current    
Financing Receivable, Past Due [Line Items]    
Total Loans 306,160 278,175
Real estate loans: | Construction and land    
Financing Receivable, Past Due [Line Items]    
Total Loans 116,878 63,105
Real estate loans: | Construction and land | 30-59 Days Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 1,210 837
Real estate loans: | Construction and land | 60-89 Days Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 0 0
Real estate loans: | Construction and land | Greater than 90 Days Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 296 0
Recorded Investment > 90 Days and Accruing 0 0
Real estate loans: | Construction and land | Total Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 1,506 837
Real estate loans: | Construction and land | Current    
Financing Receivable, Past Due [Line Items]    
Total Loans 115,372 62,268
Consumer loans: | Manufactured homes    
Financing Receivable, Past Due [Line Items]    
Total Loans 26,953 21,636
Consumer loans: | Manufactured homes | 30-59 Days Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 261 123
Consumer loans: | Manufactured homes | 60-89 Days Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 155 0
Consumer loans: | Manufactured homes | Greater than 90 Days Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 52 59
Recorded Investment > 90 Days and Accruing 0 0
Consumer loans: | Manufactured homes | Total Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 468 182
Consumer loans: | Manufactured homes | Current    
Financing Receivable, Past Due [Line Items]    
Total Loans 26,485 21,454
Consumer loans: | Floating homes    
Financing Receivable, Past Due [Line Items]    
Total Loans 74,443 59,268
Consumer loans: | Floating homes | 30-59 Days Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 0 0
Consumer loans: | Floating homes | 60-89 Days Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 0 0
Consumer loans: | Floating homes | Greater than 90 Days Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 0 244
Recorded Investment > 90 Days and Accruing 0 0
Consumer loans: | Floating homes | Total Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 0 244
Consumer loans: | Floating homes | Current    
Financing Receivable, Past Due [Line Items]    
Total Loans 74,443 59,024
Consumer loans: | Other consumer    
Financing Receivable, Past Due [Line Items]    
Total Loans 17,923 16,748
Consumer loans: | Other consumer | 30-59 Days Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 360 2
Consumer loans: | Other consumer | 60-89 Days Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 5 76
Consumer loans: | Other consumer | Greater than 90 Days Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 0 0
Recorded Investment > 90 Days and Accruing 0 0
Consumer loans: | Other consumer | Total Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 365 78
Consumer loans: | Other consumer | Current    
Financing Receivable, Past Due [Line Items]    
Total Loans 17,558 16,670
Commercial business    
Financing Receivable, Past Due [Line Items]    
Total Loans 23,815 28,026
Commercial business | 30-59 Days Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 4 6
Commercial business | 60-89 Days Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 0 0
Commercial business | Greater than 90 Days Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 0 176
Recorded Investment > 90 Days and Accruing 0 0
Commercial business | Total Past Due    
Financing Receivable, Past Due [Line Items]    
Total Loans 4 182
Commercial business | Current    
Financing Receivable, Past Due [Line Items]    
Total Loans $ 23,811 $ 27,844
v3.22.4
Loans -Schedule of Credit Risk Profile Based on Payment Activity (Details) - USD ($)
$ in Thousands
Dec. 31, 2022
Dec. 31, 2021
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans $ 867,556 $ 687,868
Performing    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 864,597 682,316
Nonperforming    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 2,959 5,552
Real estate loans:    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 724,422 562,190
Real estate loans: | One-to-four Family    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 274,638 207,660
Real estate loans: | One-to-four Family | Performing    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 272,503 205,453
Real estate loans: | One-to-four Family | Nonperforming    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 2,135 2,207
Real estate loans: | Home Equity    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 19,548 13,250
Real estate loans: | Home Equity | Performing    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 19,406 13,110
Real estate loans: | Home Equity | Nonperforming    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 142 140
Real estate loans: | Commercial and Multifamily    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 313,358 278,175
Real estate loans: | Commercial and Multifamily | Performing    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 313,358 275,795
Real estate loans: | Commercial and Multifamily | Nonperforming    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 0 2,380
Real estate loans: | Construction and Land    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 116,878 63,105
Real estate loans: | Construction and Land | Performing    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 116,554 63,072
Real estate loans: | Construction and Land | Nonperforming    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 324 33
Consumer loans:    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 119,319 97,652
Consumer loans: | Manufactured Homes    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 26,953 21,636
Consumer loans: | Manufactured Homes | Performing    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 26,857 21,514
Consumer loans: | Manufactured Homes | Nonperforming    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 96 122
Consumer loans: | Floating Homes    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 74,443 59,268
Consumer loans: | Floating Homes | Performing    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 74,443 58,775
Consumer loans: | Floating Homes | Nonperforming    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 0 493
Consumer loans: | Other Consumer    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 17,923 16,748
Consumer loans: | Other Consumer | Performing    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 17,661 16,748
Consumer loans: | Other Consumer | Nonperforming    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 262 0
Commercial business loans    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 23,815 28,026
Commercial business loans | Performing    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans 23,815 27,850
Commercial business loans | Nonperforming    
Financing Receivable, Credit Quality Indicator [Line Items]    
Total loans $ 0 $ 176
v3.22.4
Loans -Schedule of Impaired Loans (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Financing receivable Impaired    
Unpaid Principal Balance $ 4,856 $ 7,836
Without Allowance 3,858 6,375
With Allowance 986 1,350
Total Recorded Investment 4,844 7,725
Related Allowance 184 293
Average Recorded Investment 6,041 5,661
Interest Income Recognized 174 398
Real estate loans: | One-to-four family    
Financing receivable Impaired    
Unpaid Principal Balance 3,758 4,177
Without Allowance 3,038 3,109
With Allowance 708 957
Total Recorded Investment 3,746 4,066
Related Allowance 102 112
Average Recorded Investment 3,628 3,471
Interest Income Recognized 106 198
Real estate loans: | Home equity    
Financing receivable Impaired    
Unpaid Principal Balance 210 215
Without Allowance 142 140
With Allowance 68 75
Total Recorded Investment 210 215
Related Allowance 5 7
Average Recorded Investment 216 287
Interest Income Recognized 16 16
Real estate loans: | Commercial and multifamily    
Financing receivable Impaired    
Unpaid Principal Balance   2,380
Without Allowance   2,380
With Allowance   0
Total Recorded Investment   2,380
Related Allowance   0
Average Recorded Investment 1,405 617
Interest Income Recognized 0 138
Real estate loans: | Construction and land    
Financing receivable Impaired    
Unpaid Principal Balance 358 68
Without Allowance 324 33
With Allowance 34 35
Total Recorded Investment 358 68
Related Allowance 3 4
Average Recorded Investment 124 111
Interest Income Recognized 20 4
Consumer loans: | Manufactured homes    
Financing receivable Impaired    
Unpaid Principal Balance 187 221
Without Allowance 93 44
With Allowance 94 177
Total Recorded Investment 187 221
Related Allowance 52 144
Average Recorded Investment 202 239
Interest Income Recognized 15 17
Consumer loans: | Floating homes    
Financing receivable Impaired    
Unpaid Principal Balance   493
Without Allowance   493
With Allowance   0
Total Recorded Investment   493
Related Allowance   0
Average Recorded Investment 98 508
Interest Income Recognized 0 18
Consumer loans: | Other consumer    
Financing receivable Impaired    
Unpaid Principal Balance 343 106
Without Allowance 261 0
With Allowance 82 106
Total Recorded Investment 343 106
Related Allowance 22 26
Average Recorded Investment 299 110
Interest Income Recognized 17 5
Commercial business loans    
Financing receivable Impaired    
Unpaid Principal Balance   176
Without Allowance   176
With Allowance   0
Total Recorded Investment   176
Related Allowance   0
Average Recorded Investment 69 318
Interest Income Recognized $ 0 $ 2
v3.22.4
Loans -Schedule of Related Party Loans (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Loans and Leases Receivable, Related Parties [Roll Forward]    
Balance, beginning of period $ 4,365 $ 3,995
Advances 100 0
New / (reclassified) loans, net (822) 551
Repayments (315) (181)
Balance, end of period $ 3,328 $ 4,365
v3.22.4
Mortgage Servicing Rights -Narrative (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Servicing Assets at Fair Value [Line Items]    
Mortgage servicing rights portfolio $ 472.5 $ 508.1
Contractually specified servicing, late and ancillary fees earned on the mortgage servicing rights 1.2 1.3
Federal National Mortgage Association    
Servicing Assets at Fair Value [Line Items]    
Loans serviced for others 470.3 504.1
Other financial institutions    
Servicing Assets at Fair Value [Line Items]    
Loans serviced for others $ 2.2 $ 4.0
v3.22.4
Mortgage Servicing Rights -Summary of Change in the Balance of Mortgage Servicing Assets (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Servicing Asset at Fair Value, Amount [Roll Forward]    
Beginning balance, at fair value $ 4,273 $ 3,780
Servicing rights that result from transfers and sale of financial assets 207 1,301
Changes in fair value:    
Due to changes in model inputs or assumptions 207 (808)
Ending balance, at fair value $ 4,687 $ 4,273
v3.22.4
Mortgage Servicing Rights -Mortgage Service Rights Assumptions (Details)
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Transfers and Servicing [Abstract]    
Prepayment speed (Public Securities Association "PSA" model) 132.00% 205.00%
Weighted-average life 7 years 6 months 5 years 9 months 18 days
Yield to maturity discount rate 12.50% 12.50%
v3.22.4
Premises and Equipment (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Property, Plant and Equipment [Line Items]    
Premises and equipment, gross $ 14,180 $ 13,783
Less: Accumulated depreciation and amortization (8,667) (7,964)
Premises and equipment, net 5,513 5,819
Depreciation and amortization 704 676
Land    
Property, Plant and Equipment [Line Items]    
Premises and equipment, gross 920 920
Buildings and improvements    
Property, Plant and Equipment [Line Items]    
Premises and equipment, gross 7,168 7,059
Furniture and equipment    
Property, Plant and Equipment [Line Items]    
Premises and equipment, gross $ 6,092 $ 5,804
v3.22.4
Other Real Estate Owned and Repossessed Assets (Details)
$ in Thousands
 12 Months Ended
Dec. 31, 2022
USD ($)
loan
Dec. 31, 2021
USD ($)
Other Real Estate [Roll Forward]    
Beginning balance $ 659 $ 594
Additions to OREO and repossessed assets 0 84
Sales 0 (19)
Ending balance $ 659 $ 659
Number of loans in process of foreclosure | loan 4  
Mortgage loans in process of foreclosure, amount $ 1,600  
v3.22.4
Deposits - Corresponding Weighted-average Cost of Funds & Maturities of Time Deposits (Details) - USD ($)
$ in Thousands
Dec. 31, 2022
Dec. 31, 2021
Deposit Balance    
Noninterest-bearing demand $ 170,549 $ 187,684
Interest-bearing demand 254,982 307,061
Savings 95,641 103,401
Money market 74,639 91,670
Certificates 210,305 105,722
Escrow 2,647 2,782
Total deposits $ 808,763 $ 798,320
Wtd. Avg Rate    
Noninterest-bearing demand 0.00% 0.00%
Interest-bearing demand 0.21% 0.19%
Savings 0.05% 0.08%
Money market 0.28% 0.21%
Certificates 0.97% 1.57%
Escrow 0.00% 0.00%
Total 0.37% 0.41%
Time Deposits, Fiscal Year Maturity [Abstract]    
2023 $ 169,273  
2024 33,138  
2025 5,042  
2026 2,049  
2027 791  
Thereafter 12  
Total time deposits $ 210,305  
v3.22.4
Deposits - Narrative (Details) - USD ($)
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Deposits [Abstract]    
Maximum time to maturity of certificate accounts 6 years  
Time deposits in denominations of $250,000 or more $ 56,100,000 $ 19,100,000
Brokered deposits 0 0
Related party deposits 8,100,000 4,900,000
Maximum federal insurability of time deposits $ 250,000 $ 250,000
v3.22.4
Borrowings, FHLB Stock and Subordinated Notes (Details) - USD ($)
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Short-term Debt [Line Items]      
Loans used as collateral for credit facility $ 865,981,000 $ 686,398,000  
Minimum required investment in Federal Home Loan Bank Stock 2,800,000 1,000,000  
Subordinated notes      
Short-term Debt [Line Items]      
Aggregate principal     $ 12,000,000
Interest rate     5.25%
Proceeds from subordinated notes, net     $ 11,600,000
Redemption price, percentage of principal amount redeemed     100.00%
Unamortized debt issuance cost (324,000) (366,000)  
Subordinated notes | Period before October 1, 2025      
Short-term Debt [Line Items]      
Interest rate     5.25%
Subordinated notes | After October 1, 2025      
Short-term Debt [Line Items]      
Incremental term     3 months
Subordinated notes | After October 1, 2025 | SOFR      
Short-term Debt [Line Items]      
Basis spread on variable rate     5.13%
FHLB      
Short-term Debt [Line Items]      
Average balance outstanding 27,300,000 0  
Minimum required investment in Federal Home Loan Bank Stock 2,800,000 1,000,000  
FHLB | Asset Pledged as Collateral      
Short-term Debt [Line Items]      
Maximum borrowing capacity 442,100,000 417,700,000  
Outstanding borrowings $ 43,000,000 $ 0  
Weighted-average interest rate of borrowings 2.14% 0.00%  
Maximum amount outstanding $ 114,000,000 $ 0  
One-to-four family | FHLB | Asset Pledged as Collateral      
Short-term Debt [Line Items]      
Loans used as collateral for credit facility 204,100,000 59,700,000  
Commercial and multifamily | FHLB | Asset Pledged as Collateral      
Short-term Debt [Line Items]      
Loans used as collateral for credit facility 45,400,000 52,900,000  
Home equity | FHLB | Asset Pledged as Collateral      
Short-term Debt [Line Items]      
Loans used as collateral for credit facility 505,000 482,000  
Line of Credit | Pacific Coast Banker's Bank      
Short-term Debt [Line Items]      
Outstanding borrowings $ 0 0  
Term period 1 year    
Current borrowing capacity $ 20,000,000    
Irrevocable letters of credit | FHLB      
Short-term Debt [Line Items]      
Letters of credit to secure public deposits 8,000,000 11,500,000  
Net remaining amount available 199,000,000 101,500,000  
Federal Reserve Bank      
Short-term Debt [Line Items]      
Outstanding borrowings 0 0  
Unused borrowing capacity $ 20,800,000 $ 22,400,000  
v3.22.4
Fair Value Measurements -Schedule of Fair Value Hierarchy for Financial Instruments (Details) - USD ($)
$ in Thousands
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
FINANCIAL ASSETS:      
Available for sale securities $ 10,207 $ 8,419  
Held-to-maturity securities 1,810    
Mortgage servicing rights 4,687 4,273 $ 3,780
FINANCIAL LIABILITIES:      
Accrued interest payable 395 200  
Level 1      
FINANCIAL ASSETS:      
Cash and cash equivalents 57,836 183,590  
Available for sale securities 0 0  
Held-to-maturity securities 0    
Loans held-for-sale   0  
Loans held-for-portfolio, net 0 0  
Mortgage servicing rights 0 0  
FHLB Stock 0 0  
FINANCIAL LIABILITIES:      
Non-maturity deposits 0 0  
Time deposits 0 0  
Borrowings 0    
Subordinated notes 0 0  
Level 2      
FINANCIAL ASSETS:      
Cash and cash equivalents 0 0  
Available for sale securities 10,207 8,419  
Held-to-maturity securities 1,810    
Loans held-for-sale   3,094  
Loans held-for-portfolio, net 0 0  
Mortgage servicing rights 0 0  
FHLB Stock 2,832 1,046  
FINANCIAL LIABILITIES:      
Non-maturity deposits 598,458 692,598  
Time deposits 209,965 106,834  
Borrowings 43,000    
Subordinated notes 10,420 11,634  
Level 3      
FINANCIAL ASSETS:      
Cash and cash equivalents 0 0  
Available for sale securities 0 0  
Held-to-maturity securities 0    
Loans held-for-sale   0  
Loans held-for-portfolio, net 801,153 675,154  
Mortgage servicing rights 4,687 4,273  
FHLB Stock 0 0  
FINANCIAL LIABILITIES:      
Non-maturity deposits 0 0  
Time deposits 0 0  
Borrowings 0    
Subordinated notes 0 0  
Carrying Value      
FINANCIAL ASSETS:      
Cash and cash equivalents 57,836 183,590  
Available for sale securities 10,207 8,419  
Held-to-maturity securities 2,199    
Loans held-for-sale   3,094  
Loans held-for-portfolio, net 858,382 680,092  
Mortgage servicing rights 4,687 4,273  
FHLB Stock 2,832 1,046  
FINANCIAL LIABILITIES:      
Non-maturity deposits 598,458 692,598  
Time deposits 210,305 105,722  
Borrowings 43,000    
Subordinated notes 11,676 11,634  
Estimated Fair Value      
FINANCIAL ASSETS:      
Cash and cash equivalents 57,836 183,590  
Available for sale securities 10,207 8,419  
Held-to-maturity securities 1,810    
Loans held-for-sale   3,094  
Loans held-for-portfolio, net 801,153 675,154  
Mortgage servicing rights 4,687 4,273  
FHLB Stock 2,832 1,046  
FINANCIAL LIABILITIES:      
Non-maturity deposits 598,458 692,598  
Time deposits 209,965 106,834  
Borrowings 43,000    
Subordinated notes $ 10,420 $ 11,634  
v3.22.4
Fair Value Measurements - Schedule of Fair value of Assets Measured on Recurring and Nonrecurring Basis (Details) - USD ($)
$ in Thousands
Dec. 31, 2022
Dec. 31, 2021
Recurring    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Treasury bills $ 1,594  
Municipal bonds 5,421 $ 6,066
Agency mortgage-backed securities 3,192 2,353
MSRs 4,687 4,273
Recurring | Level 1    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Treasury bills 0  
Municipal bonds 0 0
Agency mortgage-backed securities 0 0
MSRs 0 0
Recurring | Level 2    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Treasury bills 1,594  
Municipal bonds 5,421 6,066
Agency mortgage-backed securities 3,192 2,353
MSRs 0 0
Recurring | Level 3    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Treasury bills 0  
Municipal bonds 0 0
Agency mortgage-backed securities 0 0
MSRs 4,687 4,273
Nonrecurring    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
OREO and repossessed assets 659 659
Impaired loans 4,844 7,725
Nonrecurring | Level 1    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
OREO and repossessed assets 0 0
Impaired loans 0 0
Nonrecurring | Level 2    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
OREO and repossessed assets 0 0
Impaired loans 0 0
Nonrecurring | Level 3    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
OREO and repossessed assets 659 659
Impaired loans $ 4,844 $ 7,725
v3.22.4
Fair Value Measurements -Summary of Quantitative Information (Details) - Level 3 - Discounted cash flow
Dec. 31, 2022
Dec. 31, 2021
Prepayment speed assumption | Recurring | Mortgage Servicing Rights | Minimum    
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)    
MSRs 1.19 2.04
Prepayment speed assumption | Recurring | Mortgage Servicing Rights | Maximum    
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)    
MSRs 4.61 3.44
Prepayment speed assumption | Recurring | Mortgage Servicing Rights | Weighted average    
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)    
MSRs 1.32 2.05
Discount rate | Recurring | Mortgage Servicing Rights | Minimum    
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)    
MSRs 0.105 0.105
Discount rate | Recurring | Mortgage Servicing Rights | Maximum    
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)    
MSRs 0.145 0.145
Discount rate | Recurring | Mortgage Servicing Rights | Weighted average    
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)    
MSRs 0.125 0.125
Discount rate | Nonrecurring | Impaired loans | Minimum    
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)    
OREO and repossessed assets 0 0
Discount rate | Nonrecurring | Impaired loans | Maximum    
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)    
OREO and repossessed assets 0.1275 0.10
Discount rate | Nonrecurring | Impaired loans | Weighted average    
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)    
OREO and repossessed assets 0.05 0.04
v3.22.4
Leases - Narrative (Details)
 12 Months Ended
Dec. 31, 2022
segment
Lessee, Lease, Description [Line Items]  
Number of renewal options 1
Minimum  
Lessee, Lease, Description [Line Items]  
Initial lease term 3 years
Remaining lease term 5 months
Maximum  
Lessee, Lease, Description [Line Items]  
Initial lease term 10 years
Remaining lease term 6 years 6 months
v3.22.4
Leases - Summary of Balance Sheet Information Related to Leases (Details) - USD ($)
$ in Thousands
Dec. 31, 2022
Dec. 31, 2021
Leases [Abstract]    
Operating lease right of use assets $ 5,102 $ 5,811
Operating lease liabilities $ 5,448 $ 6,242
v3.22.4
Leases - Summary of Components of the Leases and Supplemental Cash Flow Information (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Property, Plant and Equipment [Line Items]    
Sublease income $ (11) $ (11)
Net lease expense 1,108 1,123
Office Leases    
Property, Plant and Equipment [Line Items]    
Operating lease expense: $ 1,119 $ 1,134
Weighted-average remaining lease term: 6 years 1 month 6 days 7 years
Weighted-average discount rate (annualized): 2.63% 2.67%
Operating cash flows $ 1,067 $ 1,042
v3.22.4
Leases - Schedule of Lease Liability Maturities (Details) - USD ($)
$ in Thousands
Dec. 31, 2022
Dec. 31, 2021
Property, Plant and Equipment [Line Items]    
Present value of lease liabilities $ 5,448 $ 6,242
Office Leases    
Property, Plant and Equipment [Line Items]    
2022 1,051  
2023 1,031  
2024 884  
2025 864  
2026 881  
Thereafter 1,196  
Total lease payments 5,907  
Less: Present value discount 459  
Present value of lease liabilities $ 5,448  
v3.22.4
Earnings Per Share (Details) - USD ($)
$ / shares in Units, $ in Thousands
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Earnings Per Share [Abstract]    
Net income $ 8,804 $ 9,156
LESS: Participating dividends - Unvested RSAs (14) (14)
LESS: Income allocated to participating securities - Unvested RSAs (47) (49)
Net income available to common stockholders - basic 8,743 9,093
ADD BACK: Income allocated to participating securities - Unvested RSAs 47 49
LESS: Income reallocated to participating securities - Unvested RSAs (47) (48)
Net income available to common stockholders - diluted $ 8,743 $ 9,094
Weighted average number of shares outstanding, basic (in shares) 2,578,496 2,582,775
Effect of potentially dilutive common shares (in shares) 34,918 43,741
Weighted average number of shares outstanding, diluted (in shares) 2,613,414 2,626,516
Earnings per share, basic (in dollars per share) $ 3.39 $ 3.52
Earnings per share, diluted (in dollars per share) $ 3.35 $ 3.46
Anti-dilutive securities not included in computation of diluted earnings per common share (in shares) 2,612 0
v3.22.4
Employee Benefits -401(K) Plan and Deferred Compensation Plan Narrative (Details)
$ in Thousands
 12 Months Ended
Dec. 31, 2022
USD ($)
monthly_installment
Dec. 31, 2021
USD ($)
Deferred Compensation Liability [Abstract]    
Employer contribution amount $ 259 $ 230
Equal monthly installment | monthly_installment 120  
Deferred compensation liability $ 111 111
Nonqualified deferred compensation plan    
Deferred Compensation Liability [Abstract]    
Percentage of annual compensation to be deferred 80.00%  
Percentage of employer discretionary contribution 100.00%  
Deferred compensation, requisite service period 3 years  
Annual vesting rate 20.00%  
Deferred compensation, service period for vesting to commence 2 years  
Employer discretionary contribution $ 205 $ 93
Nonqualified deferred compensation plan | Maximum    
Deferred Compensation Liability [Abstract]    
Period of distribution in case of separation from service in annual installments 10 years  
Period of in-service distributions in annual installments 5 years  
v3.22.4
Employee Benefits -Supplemental Executive Retirement Plans Narrative (Details) - Ms. Stewart
 12 Months Ended
Dec. 31, 2022
USD ($)
plan
SERP  
Defined Benefit Plan Disclosure [Line Items]  
Number of supplemental executive retirement plans | plan 2
SERP 1  
Defined Benefit Plan Disclosure [Line Items]  
Annual benefit payment related to supplemental executive retirement benefit plans $ 53,320
SERP 2  
Defined Benefit Plan Disclosure [Line Items]  
Annual benefit payment related to supplemental executive retirement benefit plans $ 99,450
Period to pay single lump sum amount 90 days
Lump sum amount eligible for beneficiary $ 1,100,000
v3.22.4
Employee Benefits -Stock Options and Restricted Stock Narrative (Details)
$ in Thousands
 12 Months Ended
Dec. 31, 2022
USD ($)
plan
shares
Dec. 31, 2021
USD ($)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Number of existing Equity Incentive Plans | plan 1  
Share-based compensation | $ $ 475 $ 360
Employee stock option    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Cumulative number of shares issued (in shares) 283,484  
Restricted stock    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Cumulative number of shares issued (in shares) 150,971  
2013 Plan | Stock options and stock appreciation rights    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Number of shares authorized (in shares) 181,750  
2013 Plan | Restricted stock and restricted stock units    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Number of shares authorized (in shares) 116,700  
v3.22.4
Employee Benefits -Stock Option Awards Narrative (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Shares exercised intrinsic value $ 207 $ 447
Employee stock option    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Term of awards 10 years  
Unrecognized compensation cost $ 112  
Remaining weighted-average vesting period 2 years 6 months  
Employee stock option | 2008 Plan    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Award annual vesting rights 20.00%  
Vesting commencement period from grant date 1 year  
Employee stock option | 2013 Plan | Minimum    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Award vesting period 1 year  
Employee stock option | 2013 Plan | Maximum    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Award vesting period 4 years  
v3.22.4
Employee Benefits -Summary of Stock Option Plan Award Activity (Details) - Employee stock option - USD ($)
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Shares    
Outstanding at the beginning of the year (in shares) 91,316  
Granted (in shares) 12,800  
Exercised (in shares) (11,421)  
Forfeited (in shares) (918)  
Expired (in shares) (252)  
Outstanding at the end of the year (in shares) 91,525 91,316
Exercisable (in shares) 70,559  
Expected to vest, assuming a 0% forfeiture rate over the vesting term (in shares) 91,525  
Weighted-Average Exercise Price    
Outstanding, beginning of the year (in dollars per share) $ 24.59  
Granted (in dollars per share) 42.85  
Exercised (in dollars per share) 19.52  
Forfeited (in dollars per share) 34.92  
Expired (in dollars per share) 35.13  
Outstanding, end of the year (in dollars per share) 27.64 $ 24.59
Exercisable (in dollars per share) 24.57  
Expected to vest, assuming a 0% forfeiture rate over the vesting term (in dollars per share) $ 27.64  
Weighted-Average Remaining Contractual Term In Years and Aggregate Instrinsic Value    
Outstanding, contractual term 4 years 7 months 24 days 4 years 9 months 7 days
Exercisable, contractual term 3 years 7 months 2 days  
Expected to vest, assuming a 0% forfeiture rate over the vesting term, contractual term 4 years 7 months 24 days  
Outstanding, aggregate intrinsic value $ 1,109,392 $ 1,772,667
Exercisable, aggregate intrinsic value 1,046,742  
Expected to vest, assuming a 0% forfeiture rate over the vesting term, aggregate intrinsic value $ 1,109,392  
Forfeiture rate 0.00%  
Summary of Weighted-average Assumptions Used in Determining Fair Value of Options Granted    
Annual dividend yield 1.59% 1.60%
Expected volatility 26.48% 21.67%
Risk-free interest rate 1.64% 0.60%
Expected term 6 years 6 years 6 months
Weighted-average grant date fair value per option granted (in dollars per share) $ 9.95 $ 5.64
v3.22.4
Employee Benefits -Restricted Stock Awards Narrative (Details) - Restricted stock - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Unrecognized compensation cost $ 403  
Remaining weighted-average vesting period 2 years 4 months 24 days  
Total fair value of shares vested $ 308 $ 265
2008 Plan    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Award annual vesting rights 20.00%  
Vesting commencement period from grant date 1 year  
2013 Plan | Minimum    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Award vesting period 1 year  
2013 Plan | Maximum    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Award vesting period 4 years  
v3.22.4
Employee Benefits -Summary of Nonvested Restricted Stock Awards (Details) - Restricted stock
 12 Months Ended
Dec. 31, 2022
$ / shares
shares
Shares  
Non-vested, beginning of period (in shares) | shares 17,586
Granted (in shares) | shares 9,700
Vested (in shares) | shares (8,477)
Forfeited (in shares) | shares (930)
Expired (in shares) | shares 0
Non-vested, end of period (in shares) | shares 17,879
Expected to vest assuming a 0% forfeiture rate over the vesting term (in shares) | shares 17,879
Weighted-Average Grant-Date Fair Value Per Share  
Non-vested, beginning of period (in dollars per share) $ 34.02
Granted (in dollars per share) 42.85
Vested (in dollars per share) 36.34
Forfeited (in dollars per share) 35.58
Non-vested, end of period (in dollars per share) 37.63
Expected to vest assuming a 0% forfeiture rate over the vesting term (in dollars per share) 37.63
Aggregate Intrinsic Value Per Share  
Aggregate intrinsic value per share (in dollars per share) 39.27
Expected to vest assuming a 0% forfeiture rate over the vesting term, aggregate intrinsic value per share (in dollars per share) $ 39.27
Forfeiture rate 0.00%
v3.22.4
Employee Benefits - Employee Stock Ownership Plan Narrative (Details) - USD ($)
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Jan. 01, 2022
Aug. 31, 2012
Jan. 31, 2008
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items]          
Shares released (in shares)   11,340      
Unallocated shares (in shares)     0    
Shares purchased by ESOP (in shares) 19,438 7,343      
Number of allocated shares (in shares) 155,135 131,805      
Number of restricted shares held by the trust (in shares) 155,135        
Fair value of shares held by ESOP trust $ 6,400,000        
ESOP compensation expense 820,000 $ 781,000      
ESOP Borrowing 2008          
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items]          
Amount borrowed by ESOP to purchase common stock         $ 1,200,000
ESOP Borrowing 2012          
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items]          
Amount borrowed by ESOP to purchase common stock $ 1,100,000     $ 1,100,000  
Repayment period 10 years        
ESOP loan interest rate 2.25%        
ESOP remaining loan balance from shares purchased $ 0        
v3.22.4
Income Taxes - Provision for Income Taxes (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Income Tax Disclosure [Abstract]    
Current $ 2,221 $ 2,315
Deferred (149) (43)
Total tax expense $ 2,072 $ 2,272
v3.22.4
Income Taxes - Reconciliation of Provision for Income Taxes (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Income Tax Disclosure [Abstract]    
Provision at statutory rate $ 2,282 $ 2,400
Tax-exempt income (169) (203)
Other (41) 75
Total tax expense $ 2,072 $ 2,272
Federal Tax Rate 21.00% 21.00%
Tax exempt rate (1.60%) (1.80%)
Other (0.30%) 0.70%
Effective tax rate 19.10% 19.90%
v3.22.4
Income Taxes - Components of Deferred Tax Assets (Details) - USD ($)
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Deferred tax assets    
Deferred compensation and supplemental retirement $ 401,000 $ 381,000
Equity based compensation 159,000 120,000
Intangible assets 38,000 46,000
Lease liabilities 1,075,000 1,311,000
Unrealized loss on securities 297,000 0
Allowance for loan losses 1,596,000 1,324,000
Other, net 109,000 71,000
Total deferred tax assets 3,675,000 3,253,000
Deferred tax liabilities    
Prepaid expenses (159,000) (100,000)
FHLB stock dividends (40,000) (40,000)
Unrealized gain on securities 0 (37,000)
Depreciation (108,000) (165,000)
Mortgage servicing rights (493,000) (568,000)
Deferred loan costs (952,000) (739,000)
Right of use assets (1,056,000) (1,220,000)
Total deferred tax liabilities (2,808,000) (2,869,000)
Net deferred tax asset 867,000 384,000
Unrecognized tax benefits 0 0
Income tax penalties and interest expense $ 0 $ 0
v3.22.4
Capital - Narrative (Details)
$ / shares in Units, $ in Millions
 12 Months Ended
Dec. 31, 2022
USD ($)
$ / shares
shares
Dec. 31, 2021
$ / shares
shares
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items]    
Community bank leverage ratio 0.1083  
Common stock repurchased (in shares) | shares 46,799 3,657
Stock repurchase program, average price (in dollars per share) | $ / shares $ 37.05 $ 41.68
Stock repurchase program, remaining authorized repurchase amount | $ $ 2.1  
Sound Financial Bancorp    
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items]    
Community bank leverage ratio 0.0986  
v3.22.4
Concentrations of Credit Risk (Details)
 12 Months Ended
Dec. 31, 2022
Accounts receivable | Customer concentration risk | Maximum  
Concentration Risk [Line Items]  
Loans to any borrower as a percent of unimpaired capital and surplus 15.00%
v3.22.4
Commitments and Contingencies -Summary of Financial Instruments whose Contract Amount Represents Credit Risk (Details) - USD ($)
$ in Thousands
Dec. 31, 2022
Dec. 31, 2021
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items]    
Financial instruments whose contract amount represents a credit risk $ 101,323 $ 131,647
Residential mortgage commitments    
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items]    
Financial instruments whose contract amount represents a credit risk 3,184 6,663
Unfunded construction commitments    
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items]    
Financial instruments whose contract amount represents a credit risk 65,072 89,797
Unused lines of credit    
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items]    
Financial instruments whose contract amount represents a credit risk 32,793 35,036
Irrevocable letters of credit    
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items]    
Financial instruments whose contract amount represents a credit risk $ 275 $ 151
v3.22.4
Commitments and Contingencies -Narrative (Details) - USD ($)
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Guarantor Obligations [Line Items]    
Fixed rate loan commitments $ 3,200,000 $ 6,700,000
Weighted average interest rate on fixed rate loan commitments 7.60% 4.27%
Notional amount on letters of credit to secure Washington State Public Funds $ 8,000,000 $ 11,500,000
Medical insurance claims 227,000  
Loan Repurchase Guarantee    
Guarantor Obligations [Line Items]    
Maximum amounts of guarantees on loans sold without recourse 472,500,000 508,100,000
Loans repurchased $ 0 $ 284,000
v3.22.4
Parent Company Financial Information -Balance Sheets (Details) - USD ($)
$ in Thousands
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Assets      
Cash and cash equivalents $ 57,836 $ 183,590  
Other assets 4,537 3,576  
Total assets 976,351 919,691  
Liabilities and Stockholders' Equity      
Subordinated notes, net 11,676 11,634  
Other liabilities 8,318 8,571  
Total liabilities 878,646 826,333  
Stockholders' equity 97,705 93,358 $ 85,484
Total liabilities and stockholders' equity 976,351 919,691  
Parent Company      
Assets      
Cash and cash equivalents 2,152 4,215  
Investment in Sound Community Bank 107,467 100,986  
Other assets 85 58  
Total assets 109,704 105,259  
Liabilities and Stockholders' Equity      
Subordinated notes, net 11,676 11,634  
Other liabilities 323 267  
Total liabilities 11,999 11,901  
Stockholders' equity 97,705 93,358  
Total liabilities and stockholders' equity $ 109,704 $ 105,259  
v3.22.4
Parent Company Financial Information -Statements of Income (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Condensed Income Statements, Captions [Line Items]    
Income tax benefit $ (2,072) $ (2,272)
Net income 8,804 9,156
Parent Company    
Condensed Income Statements, Captions [Line Items]    
Dividend from subsidiary 2,623 0
Interest expense on subordinated notes (672) (673)
Other expenses (715) (550)
Income (loss) before income tax benefit and equity in undistributed net income of subsidiary 1,236 (1,223)
Income tax benefit 306 257
Equity in undistributed earnings of subsidiary 7,232 9,690
Net income $ 8,774 $ 8,724
v3.22.4
Parent Company Financial Information -Statements of Cash Flows (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Cash flows from operating activities:    
Net income $ 8,804 $ 9,156
Adjustments to reconcile net income to net cash provided by operating activities:    
Net cash provided by operating activities 10,054 19,073
Cash flows from investing activities:    
Net cash used in investing activities (185,575) (78,109)
Cash flows from financing activities:    
Dividends paid (2,031) (2,039)
Repurchase of stock (1,734) (152)
Stock options exercised 223 182
Net cash provided by financing activities 49,767 48,798
Net change in cash and cash equivalents (125,754) (10,238)
Cash and cash equivalents, beginning of period 183,590 193,828
Cash and cash equivalents, end of period 57,836 183,590
Parent Company    
Cash flows from operating activities:    
Net income 8,774 8,724
Adjustments to reconcile net income to net cash provided by operating activities:    
Other, net 71 (78)
Expense allocation to holding company (134) 0
Equity in undistributed earnings of subsidiary (7,232) (9,690)
Net cash provided by operating activities 1,479 (1,044)
Cash flows from investing activities:    
ESOP shares released 0 431
Net cash used in investing activities 0 431
Cash flows from financing activities:    
Dividends paid (2,031) (2,039)
Repurchase of stock (1,734) (152)
Stock options exercised 223 182
Net cash provided by financing activities (3,542) (2,009)
Net change in cash and cash equivalents (2,063) (2,622)
Cash and cash equivalents, beginning of period 4,215 6,837
Cash and cash equivalents, end of period $ 2,152 $ 4,215
v3.22.4
Revenue from Contracts with Customers (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Service charges and fee income    
Loan fees $ 119 $ 178
Other fees 45 53
Total service charges and fee income 2,368 2,247
Earnings on cash surrender value of BOLI 219 416
Mortgage servicing income 1,242 1,284
Fair value adjustment on MSRs 207 (808)
Net gain on sale of loans 546 4,190
Total noninterest income 4,582 7,329
Net (loss) gain on OREO 0 (16)
Account maintenance fees    
Service charges and fee income    
Service charges and fee income within scope of ASC 606 324 311
Transaction-based and overdraft service charges    
Service charges and fee income    
Service charges and fee income within scope of ASC 606 446 356
Debit/ATM interchange fees    
Service charges and fee income    
Service charges and fee income within scope of ASC 606 1,394 1,322
Credit card interchange fees    
Service charges and fee income    
Service charges and fee income within scope of ASC 606 $ 40 $ 27
v3.22.4
Subsequent Events (Details)
Jan. 27, 2023
$ / shares
Subsequent Event | Dividend Declared  
Subsequent Event [Line Items]  
Dividends declared (in dollars per share) $ 0.17