1

Security Federal Corporation Annual Meeting of Shareholders

Financial Presentation

$5,676 $6,162 $5,918 $7,207

$7,794

$0

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

$7,000

$8,000

$9,000

2015 2016 2017 2018 2019

Thou

sand

s NET INCOME

SECURITY FEDERAL CORPORATION

+8%

2

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,00020

0020

0120

0220

0320

0420

0520

0620

0720

0820

0920

1020

1120

1220

1320

1420

1520

1620

1720

1820

19

Thou

sand

s NET INCOME

SECURITY FEDERAL CORPORATION

7% AVERAGE ANNUAL OVER 20 YRS

3

$800 $813 $869 $913

$963

$0$100$200$300$400$500$600$700$800$900

$1,000

2015 2016 2017 2018 2019

TOTAL ASSETS SECURITY FEDERAL CORPORATION

Mill

ions

+6%

4

$342 $372 $406

$447 $473

$0$50

$100$150$200$250$300$350$400$450$500

2015 2016 2017 2018 2019

Mill

ions

TOTAL GROSS LOANS

SECURITY FEDERAL CORPORATION +6%

5

6

1.4%

1.0% 0.8% 0.9%

0.4% 0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

2015 2016 2017 2018 2019

Thou

sand

s

Non-Performing Assets % Of Total Assets

NON- PERFORMING ASSETS AS A % OF TOTAL ASSETS

$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$350,000

12/2015 12/2016 12/2017 12/2018 12/2019

Thou

sand

s CHECKING AND SAVINGS DEPOSITS SECURITY FEDERAL CORPORATION

PERSONAL COMM

28.7% of Total

Deposits

40.3% of Total

Deposits

16% Growth

7

$0

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

$35,000

2015 2016 2017 2018 2019

Thou

sand

s NET INTEREST INCOME

SECURITY FEDERAL CORPORATION

+4%

8

0.71%

0.92%

- 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 10,000

0.50%0.55%0.60%0.65%0.70%0.75%0.80%0.85%0.90%0.95%1.00%

2015 2016 2017 2018 2019

Thou

sand

s

NON-INTEREST INCOME SECURITY FEDERAL CORPORATION

Non- Interest Income National Peers SFB

+19%

9

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

US TREASURY RATES (PRIOR YEAR SLIDE)

One Year Ten Year

10

11

0.00%

0.50%

1.00%

1.50%

2.00%

2.50%

3.00%

3.50%

4.00%

US TREASURY RATES SECURITY FEDERAL CORPORATION

ONE YEAR TEN YEAR

0.00%

0.50%

1.00%

1.50%

2.00%

2.50%

3.00%

12/16 06/19 03/20

US TREASURY RATES THROUGH 2020 SECURITY FEDERAL CORPORATION

One Year Ten Year

12

CURRENT ENVIRONMENT (PRIOR YEAR SLIDE)

• How do we prepare for all possible environments? – Diversify Income and Risk – Build Reserves

• Allowance for Loan Losses • Capital

13

BANK CAPITAL RESERVES

– In November 2019, Security Federal Corporation issued $30 million in subordinated debentures.

– Security Federal Corporation took $10 million of the proceeds of this issuance and injected into Security Federal Bank as capital.

– The remaining $20 million can be injected as needed to provide capital to the Bank.

14

15

9.80%

16.20% 17.50%

10.40%

18.20% 19.40%

4%

8%

12%

16%

20%

Leverage Tier 1 Risk Based Total Risk Based

CAPITAL RATIOS SECURITY FEDERAL BANK

2018 2019

WELL CAPITALIZED MINIMUMS

LOCAL PEERS SC/GA

NATIONAL PEERS

SECURITY FEDERAL BANK 19.44%

16.43%

15.85%

10.00%

0.00% 5.00% 10.00% 15.00% 20.00% 25.00%

TOTAL RISK- BASED CAPITAL RATIO (% OF RISK WEIGHTED ASSETS)

WELL CAPITALIZED

NATIONAL PEERS

LOCAL PEERS- SC/ GA

SECURITY FEDERAL BANK

$108 million vs $88 million $20 MILLION IN EXCESS

CAPITAL

16

SECURITY FEDERAL BANK

LOCAL PEERS- SC/GA

NATIONAL PEERS

2.01%

1.27%

1.25%

0.00% 0.50% 1.00% 1.50% 2.00% 2.50%

ALLOWANCE FOR LOAN LOSSES (AS A % OF TOTAL LOANS)

SECURITY FEDERAL BANK

LOCAL PEERS- SC/ GA

NATIONAL PEERS

$9.3 million vs $5.8 million $3.5 MILLION MORE IN

LOAN RESERVES

17

OUR FOCUS IN 2020 • The health and well-being of our employees

and customers • Helping our customers and communities

weather the storm – Participation in the Payroll Protection Program – Staying in communication with customers

• Building reserves • Maintaining a strong liquidity position

18

SHAREHOLDER STATS

19

$0.40

$0.00$0.05$0.10$0.15$0.20$0.25$0.30$0.35$0.40$0.45

ANNUAL DIVIDEND RATE SECURITY FEDERAL CORPORATION

-FIRST DIVIDEND WAS PAID IN MARCH 1991 -NOW $0.40/ SHARE ANNUALLY

-DIVIDEND YIELD ON CURRENT PRICE IS 1.4% 20

21

$28.30 $35.00

$-

$5

$10

$15

$20

$25

$30

$35

$40

STOCK PRICES SECURITY FEDERAL CORPORATION

$2,194

$292

$2,585

$1,153

$1,680

$2,336

$0$500

$1,000$1,500$2,000$2,500$3,000$3,500$4,000$4,500

1 Year Treasury S & P 500 Index Russell 2000 Index Security FederalCorporation Stock

$100 INVESTED ON 10/31/87 WOULD BE AT MARCH 31, 2020

10.2% W/ DIV

9.1% RETURN

RUSSELL 2000 INDEX – 7.3% RETURN S&P 500 INDEX – 7.4% RETURN

1 YR UST– 3.4% RETURN 22