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Code of Conduct for Directors, Officers and Employees

I. Introduction

SFSB, Inc. and Slavie Federal Savings Bank (individually and collectively, the “Company”) strive to ensure that all of its directors, officers and employees act with honesty, integrity and fairness in their capacities as directors, officers or employees of the Company. When fulfilling their duties and responsibilities in their positions with the Company, such persons shall always operate under the guidelines provided by this Code of Conduct (the “Code”).

The Company recognizes that the actions of its directors, officers and employees can affect the Company’s customers, shareholders and business partners. The Company expects that its directors, officers and employees will always conduct themselves in a manner consistent with the highest standards of honesty, integrity and fairness when carrying out their responsibilities to the Company.

Depending upon a person’s particular position with the Company, some of the provisions of this Code will not be applicable to every person. Directors, officers and employees should be aware that other Company codes of conduct or ethics, as well as applicable laws, rules and regulations, might govern their actions in addition to this Code of Conduct (this “Code”).

All directors, officers and employees shall familiarize themselves with this Code and shall direct any questions regarding the Code to one of their supervisors. All new employees are given a copy of the Code and sign a confirmation that it was received as part of their orientation. We reserve the right to monitor your continuing compliance with the provisions of this Code and to investigate any suspected violations.

II. Ethical Conduct

In fulfilling their duties to the Company, all directors, officers and employees shall, to the best of their ability:

  1. conduct themselves honestly and ethically, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;
  2. provide for full, fair, accurate, timely and understandable disclosure in communications to the public and reports and documents that are filed with the Securities and Exchange Commission;
  3. promptly report violations of this Code to the appropriate person identified in this Code;
  4. maintain confidentiality with respect to information learned during the course of employment;
  5. act responsibly when using the Company’s assets or other resources; and
  6. Hold them accountable for adherence to this Code.

III. Compliance with Laws and Procedures

At all times, you shall comply with all applicable federal, state and local laws, rules, regulations and Company procedures. You are responsible for knowing the laws, rules, regulations and procedures that apply to your particular position with the Company. You should discuss any questions or concerns regarding this matter with your supervisor or an appropriate member of the Company’s management.

IV. Conflicts of Interest

A conflict of interest arises when a person’s private, personal interests interfere with the interests of the Company. A conflict of interest also arises if the person’s and Company’s interests appear to conflict, even if they do not actually conflict. You should not take any action that directly benefits you or a third party if the action is inconsistent with the interests of the Company. A conflict of interest also arises if you have difficulty performing your duties to the Company due to personal interests.

When faced with a potential conflict of interest, you should ask yourself whether a reasonable, objective observer would believe that the interests of the Company conflict with your interests. As soon as reasonably possible, you must report any transaction that could reasonably result in a conflict of interest to your supervisor or the Chair of the Audit Committee of the Board of Directors, and must obtain written approval from such person before taking part in the transaction.

Examples of situations that may create a conflict of interest include: (i) conducting business on behalf of the Company on the basis of friendship, family connections or gift giving, (ii) making a personal, monetary investment that might affect your ability to make objective business judgments, (iii) accepting employment or a directorship position with another company and (iv) causing the Company to conduct business with a company with which you have an interest or from which you may derive a benefit.

At all times, you should avoid relationships that interfere with (or may interfere with) your ability to act independently, objectively and in the best interests of the Company.

V. Corporate Opportunity

You may not personally take advantage of an opportunity that the Company could take advantage of, nor shall you take advantage of an opportunity discovered through your position with the Company. You may not compete with the Company or use the Company’s property or information for your own personal gain.

VI. Use of Company Equipment

Telephones (including cellular phones), computers, the electronic mail system (e-mail), the Internet and other equipment provided by the Company are property of the Company and you should use these items for business purposes. However, the Company acknowledges that employees may have the need or desire to use Company equipment for personal reasons from time-to-time. You may use Company equipment for personal use, provided the use of Company equipment does not interfere with the performance of your duties to the Company or the Company’s business needs. The Company may monitor your use of Company equipment, including e-mail and the Internet. The Company may discipline you accordingly, up to and including termination of employment, if you abuse the privilege of using Company equipment. Below are some additional conditions that concern the use of the Internet and e-mail:

The Company prohibits employees from visiting websites or circulating e-mail that contain the following content: pornography; hate group content; casinos; or day-trading activities. In addition, there is to be no display, downloading or other transmissions of material that is discriminatory, defamatory, harassing, disruptive or pornographic. In using the Company’s computer system, including e-mail and the Internet, employees must not disclose confidential material or violate copyright law.

In addition, you should report to your supervisor any destruction or misuse of Company property.

VII. Gifts

You should not accept gifts or awards from another company or person related to your service to the Company without first receiving permission from your supervisor or an appropriate member of the Company’s management. You should be aware that receiving gifts from customers and vendors potentially creates the appearance of impropriety.

VIII. Insider Trading

At all times you should comply with the Company’s insider trading policy, a copy of which Management of the Company has delivered to you and is available from the Company’s Chief Financial Officer upon request.

IX. Books and Records

You should keep detailed and accurate books, records and accounts of all Company transactions that you are responsible for recording. You shall not make misleading, false or deceptive entries for any reason.

X. Public Company Reporting

All documents filed with the Securities and Exchange Commission shall be filed in a timely manner and shall contain accurate information. When called upon to do so, you shall provide the information necessary to complete public reports completely and fairly and in accordance with applicable regulations.

XI. Confidentiality of Customer Information

You shall respect the confidentiality of the Company’s customers and shall not disclose customer information to anyone except when necessary and appropriate in the course of fulfilling your responsibilities to the Company.

XII. Unfair Competition

You shall always act honestly and ethically. The Company strives to succeed through the outstanding performance of its employees, and never by taking part in dishonest or unethical actions. You shall never deceive or manipulate others, misrepresent material facts or take part in any other type of unfair dealing. These fairness principles apply to your interactions with customers, competitors, business associate and fellow employees.

XIII. Political Activities

The Company may not require you to contribute to or support a particular political group or candidate. As an employee of the Company, you have the right to participate in the political process, however, you must do so as an individual and not as a representative of the Company.

XIV. Harassment

The Company strictly prohibits sexual harassment or any other form of harassment or intimidation. This includes harassment or intimidation directed by or toward fellow co-workers, supervisors, customers or vendors. The Company will not tolerate any type of harassment, including harassment based upon an individual’s race, gender, color, religion, sexual orientation or other trait or characteristic.

If you believe that you or any other person has been the target of sexual or other unlawful harassment, you should report such conduct immediately to the Human Resources representative. The Human Resources representative will then inform your supervisor of the complaint unless it would be inappropriate to contact that person. The Human Resources representative or supervisor will also contact general counsel.

If the Human Resources representative is unavailable or you believe it would be inappropriate to contact that person, you should immediately contact your supervisor.

If your supervisor is unavailable or you believe it would be inappropriate to contact that person, you should immediately contact the Company’s general counsel.

General counsel should always be a subsequent contact for all complaints received. The contact information for general counsel is as follows:

Mr. Thomas Drechsler
1104 Kenilworth Drive, Suite 400
Towson, MD 21204

The Company will investigate the allegations and take appropriate remedial action if it determines that such action is appropriate. The Company will keep all complaints confidential to the maximum extent possible. The Company will not retaliate against any employee who reports allegations of unlawful harassment or who participates in the investigation of such allegations.

XV. Drug-Free Environment

It is the Company’s intent to create a work environment that is free from the effects of substance abuse. You shall not be under the influence of any substance including drugs, legal or illegal that adversely affects your ability to perform your duties in any way. The use of such substances can have a harmful effect on your health and/or create a dangerous work environment for you and your co-workers.

XVI. Reporting and Investigation

You should report any potential violation of this Code to the Chair of the Audit Committee, who is responsible for presenting information relating to the potential violation to the Board of Directors. To contact the Chair of the Audit Committee, please call Eric E. McLauchlin at 410-420-7992 or contact him at Shaffer, McLauchlin & Stover, LLC, 836 S. Main Street, Suite 102, Bel Air, MD 21014.

If you are not comfortable revealing your identity when making a report, you can also make an anonymous report with the Chair of the Audit Committee. Your complaint will be kept confidential to the maximum extent possible. The Company’s Whistleblower Policy protects employees who report potential violations of this Code.

The Board of Directors or a committee thereof shall promptly investigate the potential violations. On a case-by-case basis, the Board of Directors shall determine and use the investigative methods that are most likely to result in a fair and accurate decision as to whether a violation of the Code has occurred.

XVII. Amendment & Waiver

Only the Board of Directors of the Company may amend this Code or grant waivers of this Code.

XVIII. Accountability

Violators of this Code will be subject to appropriate disciplinary action, including termination.

XVIX. Important Disclaimers

This Code reflects general principles to guide you in making ethical decisions and cannot, and is not intended to address every specific situation in which we may find it appropriate to take disciplinary action. This Code is not intended to create any contract (express or implied) with you, including without limitation any employment contract, or to constitute any promise that your employment will not be terminated except for cause.