Security Bancorp, Inc. Announces Fourth Quarter Earnings

  
    
  
  
    
      Security Bancorp, Inc. (OTCBB:SCYT) today announced consolidated 
      earnings for the fourth quarter ended December 31, 2006. The Company is 
      the holding company for Security Federal Savings Bank of McMinnville, 
      Tennessee (“Bank”).
    
    
      Net income for the three months ended December 31, 2006 was $440,000, or 
      $1.03 per share, compared to $355,000, or $0.85 per share, for the same 
      quarter the previous year. Net income for the year ended December 31, 
      2006 was $1.6 million, or $3.90 per share, compared to $1.2 million or 
      $3.08 per share, for the same period a year ago.
    
    
      Net interest income after provision for loan losses for the three months 
      ended December 31, 2006 increased 18.1% to $1.3 million from $1.1 
      million for the same period the prior year. Net interest income after 
      provision for loan losses for the year ended December 31, 2006 increased 
      to $5.5 million compared to $4.6 million for the same period a year ago. 
      The increase in net interest income was attributable to the increase in 
      total interest income offset to a lesser degree by an increase in total 
      interest expense.
    
    
      Non-interest income for the three months ended December 31, 2006 was 
      $516,000 compared to $500,000 for the same quarter of 2005. The 3.2% 
      increase for the quarter was primarily attributable to an increase in 
      trust service fee income. Non-interest income for the year ended 
      December 31, 2006 remained at $1.8 million, unchanged from the 
      comparable period in 2006.
    
    
      Non-interest expense for the three months ended December 31, 2006 was 
      $1.1 million compared to $1.0 million for the same quarter of 2005. 
      Non-interest expense for the year ended December 31, 2006 increased to 
      $4.7 million compared to $4.3 million for the same period a year ago. 
      The increase was primarily a result of salary increases and increased 
      occupancy expenses.
    
    
      Consolidated assets of the Company increased 4.77% to $140.2 million at 
      December 31, 2006 from $133.8 million at December 31, 2005. Loans 
      receivable, net, increased 3.3% from $88.6 million at December 31, 2005 
      to $91.6 million at December 31, 2006. The increase in consolidated 
      assets was primarily a result of an increase in deposits and commercial 
      loans.
    
    
      The provision for loan losses increased to $65,000 for the three months 
      ended December 31, 2006 from $59,000 for the three months ended December 
      31, 2005. Non-performing assets decreased from $660,000 at December 31, 
      2005 to $260,000 at December 31, 2006. Non-performing assets to total 
      assets were 0.19% at December 31, 2006, compared to 0.49% at December 
      31, 2005.
    
    
      Investments and mortgage-backed securities available-for-sale decreased 
      from $28.0 million at December 31, 2005 to $27.8 million at December 31, 
      2006.
    
    
      Investments and mortgage-backed securities held-to-maturity decreased 
      from $1,000 at December 31, 2005 to zero at December 31, 2006 as a 
      result of the repayment of principal on mortgage-backed securities.
    
    
      Deposits increased $2.1 million from $105.9 million at December 31, 2005 
      to $108.0 million at December 31, 2006. The increase was primarily 
      attributable to an increase in certificates of deposit.
    
    
      Stockholders’ equity at December 31, 2006 was 
      $13.5 million, or 9.6% of total assets, compared to $12.0 million, or 
      8.9% of total assets, at December 31, 2005.
    
    
      Safe-Harbor Statement
    
    
      Certain matters in this News Release may constitute forward-looking 
      statements within the meaning of the Private Securities Litigation 
      Reform Act of 1995. These forward-looking statements may relate 
      to, among others, expectations of the business environment in which the 
      Company operates and projections of future performance. These 
      forward-looking statements are based upon current management 
      expectations, and may, therefore, involve risks and uncertainties. The 
      Company’s actual results, performance, or 
      achievements may differ materially from those suggested, expressed, or 
      implied by forward-looking statements as a result of a wide range of 
      factors including, but not limited to, the general business environment, 
      interest rates, competitive conditions, regulatory changes, and other 
      risks.
    
    
      
        
          SECURITY BANCORP, INC.

          
            CONSOLIDATED FINANCIAL HIGHLIGHTS
          
          
            (unaudited) (dollars in thousands)
          
        
      
      
        
        
        
          Three months ended
        
        
          Year ended
        
      
      
        
          OPERATING DATA
        
        
          December 31,
        
        
          December 31,
        
      
      
        
           
        
        
          2006 
        
        
          2005 
        
        
          2006 
        
        
          2005 
        
      
      
        
          Interest income
        
        
          $2,304 
        
        
          $1,917 
        
        
          $9,147 
        
        
          $7,432 
        
      
      
        
          Interest expense
        
        
          899 
        
        
          723 
        
        
          3,371 
        
        
          2,568 
        
      
      
        
          Provision for loan losses
        
        
          65 
        
        
          59 
        
        
          261 
        
        
          247 
        
      
      
        
          Net interest income after provision for loan losses
        
        
          1,340 
        
        
          1,135 
        
        
          5,515 
        
        
          4,617 
        
      
      
        
          Non-Interest income
        
        
          516 
        
        
          500 
        
        
          1,813 
        
        
          1,762 
        
      
      
        
          Non-Interest expense
        
        
          1,137 
        
        
          1,055 
        
        
          4,741 
        
        
          4,335 
        
      
      
        
          Income before income tax expense
        
        
          719 
        
        
          580 
        
        
          2,587 
        
        
          2,044 
        
      
      
        
          Income tax expense
        
        
          279 
        
        
          225 
        
        
          990 
        
        
          791 
        
      
      
        
          Net income
        
        
          $440 
        
        
          $355 
        
        
          $1,597 
        
        
          $1,253 
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
           
        
        
           
        
        
           
        
        
           
        
        
           
        
      
      
        
          
            FINANCIAL CONDITION DATA
          
        
        
          
            At December 31, 2006
          
        
        
          
            At December 31, 2005
          
        
      
      
        
           
        
        
           
        
        
           
        
      
      
        
          Total Assets
        
        
          $140,242 
        
        
          $133,855 
        
      
      
        
          
            Investments and mortgage-backed securities available for sale
          
        
        
          
            27,845 
          
        
        
          
            27,966 
          
        
      
      
        
          
            Investments and mortgage-backed securities held to maturity
          
        
        
          
            0 
          
        
        
          
            1 
          
        
      
      
        
          Loans receivable, net
        
        
          91,628 
        
        
          88,652 
        
      
      
        
          Deposits
        
        
          108,043 
        
        
          105,900 
        
      
      
        
          FHLB advances
        
        
          3,000 
        
        
          3,000 
        
      
      
        
          Stockholders' equity
        
        
          13,499 
        
        
          12,021 
        
      
      
        
          Non-performing assets
        
        
          260 
        
        
          660 
        
      
      
        
          Non-performing assets to total assets
        
        
          0.19%
        
        
          0.49%
        
      
      
        
          Allowance for loan losses
        
        
          1,166 
        
        
          1,022 
        
      
      
        
          Allowance for loan losses to total loans receivable, net
        
        
          1.26%
        
        
          1.14%