SCYT Security Bancorp Inc (PK)

Security Bancorp, Inc. (�Company�) (OTCBB:SCYT) today announced consolidated earnings for the second quarter of its fiscal year ended December 31, 2007. The Company is the holding company for Security Federal Savings Bank of McMinnville, Tennessee (�Bank�). Net income for the three months ended June 30, 2007 was $368,000, or $0.86 per share, compared to $421,000, or $1.01 per share, for the same quarter last year. For the six months ended June 30, 2007, the Company�s net income was $720,000, or $1.69 per share, compared to $745,000, or $1.78 per share, for the same period in 2006. Net interest income after provision for loan losses for the three months ended June 30, 2007 increased 8.9% to $1.4 million from $1.3 million for the same period last year. For the six months ended June 30, 2007, net interest income increased 11.7% to $2.8 million from $2.5 million for the comparable period in 2006. The increase in net interest income was attributable to the increase in loan balances during the quarter and the six months ended June 30, 2007. Non-interest income for the three months ended June 30, 2007 was $514,000 compared to $502,000 for the same quarter of 2006, an increase of 2.4%. For the six months ended June 30, 2007, non-interest income increased 0.1% to $993,000 from $992,000 for the comparable period in 2006. The increases during the quarter and the six months ended June 30, 2007 was attributable to an increase in the trust and loan servicing fee income and deposit service charges and fees. Non-interest expense for the three months ended June 30, 2007 was $1.4 million compared to $1.1 million for the same quarter of 2006, an increase of 18.2%. For the six months ended June 30, 2007, non-interest expense increased 14.5% to $2.7 million from $2.3 million for the comparable period in 2006. The increases during the quarter and the six months ended June 30, 2007 were primarily a result of an increase in data processing fees attributable to a system conversion. The new processing system was installed during the quarter and put into service on June 18, 2007. Consolidated assets of the Company were $144.1 million at June 30, 2007, compared to $140.2 million at December 31, 2006. Loans receivable, net, increased from $91.6 million at December 31, 2006 to $92.6 million at June 30, 2007. The 1.1% increase in loans receivable was primarily a result of an increase in commercial real estate loans. The provision for loan losses decreased 43.5% to $35,000 for the three months ended June 30, 2007 from $62,000 for the same quarter last year. Non-performing assets decreased 27.7% from $260,000 at December 31, 2006 to $188,000 at June 30, 2007. Non-performing assets to total assets were 0.13% at June 30, 2007, compared to 0.19% at December 31, 2006. Investment and mortgage-backed securities available-for-sale increased from $27.8 million at December 31, 2006 to $33.2 million at June 30, 2007. The 19.3% increase was a result of the purchase of securities pledged against public funds. Deposits increased $2.0 million, or 1.9%, from $108.0 million at December 31, 2006 to $110.0 million at June 30, 2007. The increase was primarily attributable to an increase in commercial checking account balances. Stockholders� equity at June 30, 2007 was $14.3 million, or 9.9% of total assets, compared to $13.5 million, or 9.6% of total assets, at December 31, 2006. 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 Six months ended OPERATING DATA June 30, June 30, � 2007 2006 2007 2006 Interest income $2,518 $2,226 $4,916 $4,282 Interest expense 1,043 842 2,014 1,613 Provision for loan losses 35 62 67 132 Net interest income after provision for loan losses 1,440 1,322 2,835 2,537 Non-interest income 514 502 993 992 Non-interest expense 1,358 1,149 2,655 2,318 Income before income tax expense 596 675 1,173 1,211 Income tax expense 228 254 453 466 Net income $368 $421 $720 $745 � � � � � � FINANCIAL CONDITION DATA At June 30, 2007 At December 31, 2006 Total assets $144,111 $140,242 Investment and mortgage backed securities available-for-sale 33,222 27,845 Investment and mortgage backed securities held-to-maturity 0 0 Loans receivable, net 92,607 91,628 Deposits 110,084 108,043 FHLB advances 3,000 3,000 Stockholders' equity 14,272 13,499 Non-performing assets 188 260 Non-performing assets to total assets 0.13% 0.19% Allowance for loan losses 1,172 1,166 Allowance for loan losses to total loans receivable 1.25% 1.26%