WSFS Financial (WSFS)2025-04-25 23:37Financial Data and Key Metrics Changes - WSFS Financial Corporation reported core earnings per share of 104.6 million, and core return on tangible common equity of 16.97%, all showing improvements from the prior quarter [5][6][14] - The core net interest margin expanded by 8 basis points to 3.88%, with total funding costs reduced by 15 basis points to 1.77% [6][7] - Year-over-year, the net interest margin increased by 4 basis points despite absorbing 100 basis points of interest rate cuts [7] Business Line Data and Key Metrics Changes - Core fee revenue grew by 6% year-over-year, driven by a 19% increase in Wealth and Trust services [7] - Institutional Services and Bryn Mawr Trust Company of Delaware showed strong year-over-year growth, attributed to higher deal flow [8] - Client deposits declined by 1% linked quarter but increased by 4% year-over-year, with non-interest bearing deposits up 6% year-over-year [11][12] Market Data and Key Metrics Changes - The loan to deposit ratio remained stable at 77%, providing flexibility for future growth [12] - Total net credit costs increased to 24.6 million, primarily due to a charge-off of a non-performing office-related loan [12][13] Company Strategy and Development Direction - The company announced a 13% increase in the quarterly dividend to 62.6 million of capital in the first quarter, including 8.8 million in dividends [14] - The capital ratios remain strong, with a CET1 of 14.1% and a tangible common equity (TCE) of 8.63% [14] Q&A Session Summary Question: Why was there no updated guidance in the presentation? - Management stated that it is typical to update guidance after the second quarter due to the volatility of the environment [22][23] Question: What is the outlook for net charge-offs? - Management indicated that the increase in charge-offs was due to a one-off item and that the overall portfolio is performing as expected [24][26] Question: How should expenses be viewed going forward? - Management noted that the first quarter expenses were lower than the run rate, estimating a future run rate around $160 million [33] Question: What is the outlook for commercial growth? - Management observed that clients are cautious about expansion due to market volatility, but the pipeline remains consistent [40][42] Question: How are deposit beta expectations evolving? - Management exceeded their initial goal for deposit beta, reaching 38% this quarter, and will continue to push for higher rates [56][63] Question: What is the timeframe for the CET1 target? - Management indicated a two to three-year glide path for the CET1 target, depending on macroeconomic conditions [66][68] Question: How is the company addressing potential impacts from new tariff policies? - Management is monitoring the situation closely but has not made changes to underwriting criteria yet due to the uncertainty [78][79] Question: What needs to happen for net growth to resume? - Management emphasized that greater certainty in the macro environment would help spur net growth, as clients are currently in a holding pattern [83][84]