Financial Position - As of March 31, 2025, the company reported total assets of $27,644,637,000, a decrease of $415,693,000 from $28,060,330,000 at September 30, 2024[221]. - Cash and cash equivalents amounted to $1,231,461,000 as of March 31, 2025, providing management with flexibility in managing interest rate risk[222]. - Total borrowings decreased to $2,763,758,000 as of March 31, 2025, down from $3,267,589,000 at September 30, 2024[227]. - Cash and cash equivalents decreased by $1,149,641,000, or 48.3%, to $1,231,461,000 at March 31, 2025[236]. - The Company's shareholders' equity increased by $32,320,000 to $3,032,620,000, or 10.97% of total assets, as of March 31, 2025[228]. - The ratio of tangible capital to tangible assets was 9.51% as of March 31, 2025, indicating a strong equity position[228]. Loan and Asset Performance - The average balance of loans receivable increased to $20,918,986,000 for the three months ended March 31, 2025, compared to $19,696,515,000 for the same period in 2024[219]. - Total gross loans reached $21,122,710,000 as of March 31, 2025, with significant contributions from Washington ($4,867,340,000) and California ($2,979,107,000)[245]. - Loans receivable increased by $3,647,000 to $20,920,001,000 at March 31, 2025, compared to $20,916,354,000 at September 30, 2024[240]. - Non-performing assets decreased by $6,534,000 to $70,884,000, representing 0.26% of total assets, down from 0.28%[249]. - Non-accrual loans totaled $59,886,000, with the largest share in commercial real estate at $29,320,000, accounting for 49.0% of non-accrual loans[251]. - Loans less than 90 days delinquent amounted to $506,938,000, which, if classified as non-performing, would increase the non-performing assets ratio to 2.09%[253]. - The company’s single-family residential loans accounted for 39.1% of total gross loans, indicating a strong focus on this segment[246]. Income and Expenses - The company recorded net income of $56,252,000 for the three months ended March 31, 2025, compared to $15,888,000 for the same period last year, reflecting significant growth due to the effects of the merger[263]. - Net interest income for the three months ended March 31, 2025, was $160,910,000, an increase of $2,313,000 from the prior year, with a net interest margin of 2.55% compared to 2.73% in the same quarter last year[264]. - Non-interest income for the three months ended March 31, 2025, was $18,881,000, an increase of $5,489,000 from the same period last year, primarily due to higher prepayment fees and commission income[270]. - Non-interest expense decreased to $104,832,000 for the three months ended March 31, 2025, down by $28,880,000 from $133,712,000 in the prior year quarter, largely due to reduced merger-related expenses[271]. Capital and Risk Management - The common equity tier 1 capital ratio for the Company was 11.51% as of March 31, 2025, exceeding the minimum requirement of 4.50%[235]. - The total risk-based capital ratio for the Company was 14.49% as of March 31, 2025, above the minimum requirement of 8.00%[235]. - The provision for credit losses was $2,750,000 for the three months ended March 31, 2025, compared to $16,000,000 for the same period last year, reflecting a stable loan receivable balance[269]. - Total allowance for credit losses decreased to $222,709,000 as of March 31, 2025, from $225,253,000 as of September 30, 2024, representing a decline of 1.1%[257]. - The company’s allowance for credit losses composition reflects a proactive approach to managing credit risk amid changing market conditions[256]. Market and Operational Insights - The net interest margin for the quarter ended March 31, 2025, was 2.55%, down from 2.73% for the same quarter in 2024[216]. - The yield on interest-earning assets decreased by 18 basis points to 5.32% for the quarter ended March 31, 2025[216]. - The conditional payment rate (CPR) for single-family mortgages increased to 8.10% as of March 31, 2025, up from 4.80% the previous year[215]. - Commercial loan originations accounted for 74% of total originations during the period[240]. - The effective tax rate for the three months ended March 31, 2025, was 21.88%, down from 24.21% for the same period last year[273]. Legal and Regulatory Matters - There have been no material changes in the Company's quantitative and qualitative information about market risk since September 30, 2024[278]. - No changes in the Company's internal control over financial reporting that have materially affected, or are likely to materially affect, such controls[280]. - The Company and its consolidated subsidiaries are involved in legal proceedings that are believed to be immaterial to the financial statements[282].

Loan Originations and Portfolio - Total loan originations for Q1 2025 reached $1,008,874,000, a year-to-date total of $1,939,563,000[2] - The net loan portfolio as of March 2025 is $20,920,001,000, with single-family residential loans comprising 39.3% of the total[4] - Multi-family loans increased to $4,967,125,000, accounting for 22.4% of the total loan receivables as of March 2025[4] - The total loans receivable as of March 2025 is $22,158,727,000[4] - Total loans as of March 2025 amount to $21,122,710, with a slight decrease from $21,265,022 in December 2024[6] - As of March 31, 2025, the total number of loans reached 41,380 with an average size of $510, resulting in an amortized cost of $21,122,710[17] - The total number of loans decreased from 40,825 on December 31, 2024, to 41,380 on March 31, 2025[17] Loan Performance and Delinquency - The allowance for credit losses (ACL) for loans as of March 2025 is $202,709,000, representing 1.01% of gross loans[2] - Non-performing assets total $70,884, representing 0.26% of total assets as of March 2025, down from 0.29% in December 2024[6] - Total non-accrual loans decreased to $59,886 in March 2025, down from $72,487 in December 2024[6] - Non-accrual loans as a percentage of total net loans decreased to 0.29% in March 2025, compared to 0.34% in December 2024[6] - The delinquency rate for the total loan portfolio was 0.66%, with $57,947 classified as delinquent[17] - The overall delinquency amount increased from $64,442 on December 31, 2024, to $57,947 on March 31, 2025[17] Financial Metrics and Ratios - The weighted average rate on loan originations for Q1 2025 is 7.12%[2] - Efficiency ratio improved to 58.31% in March 2025, compared to 65.04% in December 2024[8] - Tangible common shareholders' book value per share increased to $28.31 as of March 2025, up from $27.93 in December 2024[8] - Operating expenses as a percentage of average assets improved to 1.53% in March 2025, down from 1.62% in December 2024[8] - The net interest margin for the quarter ended March 31, 2025, was 2.55%, compared to 2.39% for the previous quarter[15] - The company reported a net interest income of $160,910 for the quarter ended March 31, 2025[15] Deposits and Funding - Total deposits as of March 31, 2025, amounted to $21,427,426, a slight decrease from $21,438,777 as of December 31, 2024, and $21,373,970 as of September 30, 2024[11] - Non-interest checking deposits were $2,400,172, representing 11.2% of total deposits as of March 31, 2025, down from 11.6% in December 2024[11] - Interest checking deposits increased to $4,625,596, accounting for 21.6% of total deposits, up from 21.2% in December 2024[11] - The company’s uninsured and non-collateralized deposits at the end of the period were $5,490,142, representing 25.6% of total deposits[11] Shareholder Actions and Company Operations - The company repurchased 726,082 shares at an average price of $29.39 during the quarter ending March 2025[8] - The number of employees decreased to 2,018 as of March 2025, down from 2,175 in December 2024[8] Asset Management - The total assets as of March 31, 2025, were $27,371,320, a decrease from $27,504,576 as of December 31, 2024[15] - Agency MBS investments increased to $2,074,672 as of March 2025, up from $1,600,089 in December 2024[9] - The company’s NPV post a 100 bps shock was 9.4% as of March 31, 2025, down from 9.5% in December 2024[13] Loan Segmentation - Single-Family Residential loans accounted for 21,516 loans, averaging $384, with a total amortized cost of $8,264,318[17] - The Commercial & Industrial loan segment had 2,057 loans, averaging $1,159, with a delinquency rate of 1.02%[17] - The Multi-Family loan segment saw an increase in loans to 1,901, with an average size of $2,560 and a delinquency rate of 0.79%[17] - The total number of HELOC loans was 4,473, with an average size of $64 and a delinquency rate of 0.54%[17] - The total amortized cost for Commercial Real Estate loans was $3,639,477, with a delinquency rate of 0.39%[17] - The Consumer loan segment had 8,463 loans, averaging $11, with a delinquency rate of 0.97%[17]

WaFd, Inc.’s (WAFD) second-quarter fiscal 2025 (ended March 31) adjusted earnings of 65 cents per share outpaced the Zacks Consensus Estimate of 60 cents. Also, the bottom line increased significantly year over year.See the Zacks Earnings Calendar to stay ahead of market-making news.Results were primarily aided by a rise in net interest income (NII) and non-interest income. Lower non-interest expenses and provision for credit losses also supported WAFD’s performance. However, the decline in loan balance act ...

Financial Performance - For the quarter ended March 2025, WaFd reported revenue of $179.79 million, which is an increase of 4.5% compared to the same period last year [1] - The EPS for the quarter was $0.65, down from $0.73 in the year-ago quarter [1] - The reported revenue was below the Zacks Consensus Estimate of $184.17 million, resulting in a surprise of -2.38% [1] - The company delivered an EPS surprise of +8.33%, with the consensus EPS estimate being $0.60 [1] Key Metrics - Total Non-performing Assets were reported at $70.88 million, which is better than the two-analyst average estimate of $85.18 million [4] - The average balance of Total interest-earning assets was $25.63 billion, slightly below the estimated $25.64 billion [4] - The Efficiency Ratio was 58.3%, outperforming the average estimate of 61.4% [4] - The Net Interest Margin was reported at 2.6%, matching the average estimate [4] - Total Non-accrual loans were $59.89 million, significantly lower than the average estimate of $78.56 million [4] - Total noninterest income was $18.88 million, exceeding the average estimate of $16.06 million [4] - Net Interest Income was $160.91 million, slightly below the average estimate of $164.28 million [4] Stock Performance - Shares of WaFd have returned -11.9% over the past month, compared to the Zacks S&P 500 composite's -6.1% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating it may perform in line with the broader market in the near term [3]

Company Performance - WaFd reported quarterly earnings of $0.65 per share, exceeding the Zacks Consensus Estimate of $0.60 per share, but down from $0.73 per share a year ago, representing an earnings surprise of 8.33% [1] - The company posted revenues of $179.79 million for the quarter ended March 2025, missing the Zacks Consensus Estimate by 2.38%, compared to year-ago revenues of $171.99 million [2] - Over the last four quarters, WaFd has surpassed consensus EPS estimates three times and topped consensus revenue estimates only once [2] Stock Performance - WaFd shares have declined approximately 24.1% since the beginning of the year, while the S&P 500 has decreased by 10.4% [3] - The current consensus EPS estimate for the upcoming quarter is $0.64 on revenues of $194.36 million, and for the current fiscal year, it is $2.48 on revenues of $755.03 million [7] Industry Outlook - The Zacks Industry Rank for Banks - West is currently in the bottom 46% of over 250 Zacks industries, indicating potential challenges for stock performance [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact investor decisions [5]

Group 1 - The focus is on income investing through common shares, preferred shares, or bonds, with occasional insights on the broader economy or specific company situations [1] - The author has a background in history/political science and an MBA specializing in Finance and Economics, indicating a strong analytical foundation [1] - The author has been investing since 2000 and currently serves as the CEO of an independent living retirement community in Illinois, suggesting practical experience in both investment and management [1] Group 2 - The author holds a beneficial long position in the shares of WAFDP, indicating confidence in the stock's performance [2] - The article expresses the author's personal opinions and is not influenced by compensation from any company mentioned, ensuring an independent perspective [2] - There is no business relationship with any company whose stock is mentioned, reinforcing the impartiality of the analysis [2]

Dividend Increase - WaFd, Inc. (WAFD) increased its quarterly cash dividend by 3.8% to 27 cents per share, payable on March 7, 2025, to shareholders of record as of February 21 [1] - Prior to this increase, WAFD raised its dividend by 4% to 26 cents per share in February 2024, marking the fourth increase in the past five years with an average growth rate of 4.1% [1] Capital Distribution Activities - WaFd has an ongoing share repurchase program, extended in May 2024, increasing the authorization by 10 million shares with no expiration date; approximately 11.5 million shares remain available under the current authorization as of December 31, 2024 [3] - The repurchase plan was initially announced in 1995 and has been extended multiple times, including a previous extension in January 2021 for an additional 10 million shares [3] Financial Position - As of December 31, 2024, WAFD reported total borrowings of $2.9 billion, cash and cash equivalents of $1.5 billion, net loans receivable of $21.1 billion, and total deposits of $2.9 billion [4] - The common equity Tier-1 capital ratio was 11.45%, and the total capital ratio was 14.43%, both exceeding regulatory requirements [4] Shareholder Value - Given its solid capital and liquidity positions, WaFd is expected to maintain its current capital distribution activities and enhance shareholder value [5] - Over the past year, WaFd's shares have increased by 12.6%, compared to the industry's growth of 35.6% [5]

Financial Performance - For the three months ended December 31, 2024, the company recorded net income of $47,267,000, a decrease from $58,453,000 in the prior year quarter[256]. - Net interest income for the same period was $155,431,000, which is $3,194,000 lower than the same quarter of the prior year, with a net interest margin of 2.39% compared to 2.91% a year ago[257]. - Total non-interest income rose to $15,702,000, an increase of $1,535,000 from $14,167,000 in the same period last year[261]. - Total non-interest expense for the three months ended December 31, 2024, was $111,311,000, an increase of $14,771,000 from $96,540,000 in the prior year quarter, primarily due to increased occupancy and compensation costs post-merger[262]. - The effective tax rate for the three months ended December 31, 2024, was 21.55%, compared to 18.46% for the prior year quarter[264]. Interest Rates and Margins - As of December 31, 2024, the net interest margin was 2.39%, down from 2.91% for the same quarter in 2023[210]. - The yield on interest-earning assets decreased by 16 basis points to 5.31%, while the cost of interest-bearing liabilities decreased by 32 basis points to 3.48%[210]. - The potential increase in net interest income for a 200 basis point decrease in interest rates is estimated at $26,825,000 as of December 31, 2024[208]. - The potential decrease in net present value (NPV) for a 200 basis point increase in interest rates is estimated at $(848,408,000) as of December 31, 2024[209]. Assets and Liabilities - Total assets decreased by $375,876,000 to $27,684,454,000 from $28,060,330,000 at September 30, 2024[213]. - Cash and cash equivalents decreased by $873,367,000, or 36.7%, to $1,507,735,000 since September 30, 2024[229]. - Total borrowings decreased to $2,863,675,000 from $3,267,589,000 at September 30, 2024[219]. - The Company has $537,348,000 of mortgage-backed securities designated as HTM, with a net unrealized loss of $52,242,000 as of December 31, 2024[203]. - The Company has $2,743,731,000 of AFS securities carried at fair value, with a net unrealized loss of $69,036,000 as of December 31, 2024[203]. Loans and Credit Quality - Loans receivable increased by $144,147,000 to $21,060,501,000 at December 31, 2024, with commercial loans accounting for 68% of total originations[233]. - Total gross loans increased by $72,640,000, reaching $22,432,036,000, a growth of 0.3% from the previous quarter[235]. - Non-performing assets increased by $1,695,000 to $79,113,000, with non-performing assets as a percentage of total assets at 0.29%[242]. - The allowance for credit losses on loans was $204,522,000, a slight increase of $769,000 from the previous quarter[235]. - Total non-accrual loans increased to $72,487,000, representing 0.29% of total assets, up from $69,541,000 or 0.28% in the previous quarter[245]. Capital and Equity - Shareholders' equity increased by $21,336,000 to $3,021,636,000, representing 10.91% of total assets[221]. - The common equity tier 1 capital ratio for the Company was 11.45% as of December 31, 2024, exceeding the minimum requirement of 4.50%[228]. - The ratio of tangible capital to tangible assets was 9.45% at December 31, 2024, indicating a strong equity position[221]. Operational Changes and Corporate Actions - The Company filed Articles of Amendment to change its name from Washington Federal, Inc. to WaFd, Inc. effective September 29, 2023[200]. - There have been no material changes in the company's internal control over financial reporting during the reporting period[269]. - The company is involved in legal proceedings that are believed to be immaterial to its financial statements[271]. - Management believes there have been no material changes in the company's quantitative and qualitative information about market risk since September 30, 2024[267]. Other Financial Metrics - The geographic distribution of loans shows Washington at 27.7%, Oregon at 11.7%, and California at 14.4%[241]. - Customer accounts increased by $64,807,000, or 0.3%, to $21,438,777,000 at December 31, 2024[252]. - The net gain on real estate owned (REO) for the three months ended December 31, 2024, was $429,000, down from a net gain of $1,826,000 in the prior year quarter[263]. - The estimated total amount of tax benefits from LIHTC investments for the fiscal year is approximately $19.7 million[265]. - The expected total amount of amortization expense recognized during the fiscal year related to LIHTC investments is about $16.1 million[266].

Loan Originations and Portfolio - Total loan originations for Q4 2024 amounted to $930,789, a decrease from $962,393 in Q3 2024[2] - The total net loan portfolio reached $21,060,501 as of December 2024, with single-family residential loans comprising 39.5% of the total[4] - Multi-family loans accounted for 21.5% of the total loan portfolio as of December 2024, up from 20.8% in September 2024[4] - Total loans increased to $21,265,022 thousand as of December 2024, up from $21,120,107 thousand in September 2024, reflecting a growth of 0.69%[6] - The number of loans in the Single-Family Residential category was 21,643, with an average size of $386, resulting in an amortized cost of $8,362,881[14] Financial Performance - The efficiency ratio for Q4 2024 was 65.04%, an increase from 62.13% in Q3 2024[2] - The total interest income for the quarter was $345,117, reflecting a decline from $374,097 in the previous quarter[12] - The company reported a net interest income of $155,431 for the quarter ended December 31, 2024, compared to $172,812 in the previous quarter[12] - The net interest margin for the quarter ended December 31, 2024, was 2.39%, a decrease from 2.62% in the previous quarter[12] - The average interest rate on loans receivable was 5.43% for the quarter ended December 31, 2024, down from 5.78% in the previous quarter[12] Asset and Liability Management - Total assets as of December 2024 were reported at $20,873,919[4] - For the quarter ended December 31, 2024, total assets amounted to $29,703,337, a decrease from $28,000,482 in the previous quarter[12] - The total liabilities were $26,756,281 as of December 31, 2024, down from $25,004,389 in the previous quarter[12] Credit Quality - The allowance for credit losses (ACL) for loans was $204,522, representing 1.00% of gross loans as of December 2024[2] - Non-performing assets rose to $79,113 thousand as of December 2024, compared to $77,418 thousand in September 2024, indicating an increase of 2.19%[6] - Non-accrual loans as a percentage of total net loans increased to 0.34% in December 2024 from 0.33% in September 2024[6] - The company reported net charge-offs of $231 thousand in December 2024, compared to $70 thousand in September 2024, reflecting an increase in charge-offs[6] - The delinquency rate for total loans was 0.73% as of December 31, 2024, compared to 0.69% in the previous quarter[14] Deposits and Shareholder Equity - Total deposits reached $21,438,777 thousand as of December 2024, up from $21,373,970 thousand in September 2024, representing a growth of 0.30%[8] - Time deposits accounted for 44.7% of total deposits as of December 2024, consistent with the previous quarter[8] - Non-interest checking deposits decreased slightly to $2,489,394 thousand, representing 11.6% of total deposits in December 2024[8] - The company had 81,373,760 shares outstanding as of December 2024, with 11,501,005 shares remaining authorized for repurchase[2] - Tangible common shareholders' book value per share increased to $27.93 as of December 2024, up from $27.73 in September 2024[4] Other Financial Metrics - The effective interest rate on borrowings within one year was 5.01% as of June 2024, decreasing to 4.84% by December 2024[8] - The average balance of interest-earning assets was $25,798,443 for the quarter ended December 31, 2024[12] - The conditional payment rate (CPR) for SFR Mortgages was 7.0% for the quarter ended September 30, 2023, and is projected to be 6.6% for December 31, 2023[10] - The net loan fee and discount accretion for Q4 2024 was $10,000[2] - The percentage of uninsured and non-collateralized deposits was 24.8% at the end of December 2024, slightly up from 24.0% in September 2024[8]

Core Viewpoint - WaFd, Inc. (WAFD) experienced a 3.4% decline in after-hours trading due to lower-than-expected first-quarter fiscal 2025 results, with adjusted earnings of 62 cents per share falling short of the Zacks Consensus Estimate of 69 cents and a year-over-year decline of 26.2% [1][4] Financial Performance - The quarterly net revenues were $171.1 million, reflecting a 2.8% increase from the prior-year quarter but below the Zacks Consensus Estimate of $193 million [5] - Net interest income (NII) was reported at $155.4 million, a 2.1% year-over-year growth, while the net interest margin (NIM) contracted by 52 basis points to 2.39% due to valuation adjustments related to the Luther Burbank acquisition [6] - Total non-interest income rose by 10.8% to $15.7 million, although it was below the estimate of $17.8 million [6] - Total non-interest expenses increased by 15.3% to $111.3 million, influenced by a rise in all components except FDIC insurance premiums and product delivery charges, including a restructuring charge of $5.4 million [7] - The efficiency ratio worsened to 65.04%, up from 58.02% in the prior-year quarter, indicating a decline in profitability [7] Strategic Initiatives - The company recorded a restructuring charge of $5.4 million as it shifts focus away from the single-family mortgage lending market, projecting annual cost savings of nearly $17 million by the end of June 2025 [3] - The workforce is expected to reduce by 8% as part of the restructuring, while the company will retain all existing home loans and HELOCs on its books [3] Credit Quality and Loan Performance - As of December 31, 2024, net loans receivable stood at $20.1 billion, showing marginal growth from the prior quarter, while total customer deposits remained stable at $21.4 billion [9] - The allowance for credit losses was 1% of gross loans outstanding, a slight decrease from 1.03% in the prior-year quarter, with no provisions for credit losses recorded in both the reported and last year's quarter [10] Shareholder Actions - During the reported quarter, WAFD repurchased 0.09 million shares at an average price of $38.09 per share [11] Market Outlook - The acquisition of Luther Burbank Corporation is expected to enhance WAFD's presence in the California market and contribute positively to earnings, despite elevated expenses posing a near-term challenge [12]