Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q ☒ Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended March 31, 2025 ☐ Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from to . 001-35542 (Commission File number) (Exact name of registrant as specified in its charter) Customers Bancorp, Inc. Pennsylvania 27-2290659 (State or o ...

Customers Bancorp (CUBI) reported $194.28 million in revenue for the quarter ended March 2025, representing a year-over-year increase of 7%. EPS of $1.54 for the same period compares to $1.68 a year ago.The reported revenue compares to the Zacks Consensus Estimate of $186.86 million, representing a surprise of +3.97%. The company delivered an EPS surprise of +20.31%, with the consensus EPS estimate being $1.28.While investors scrutinize revenue and earnings changes year-over-year and how they compare with W ...

Customers Bancorp (CUBI) came out with quarterly earnings of $1.54 per share, beating the Zacks Consensus Estimate of $1.28 per share. This compares to earnings of $1.68 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of 20.31%. A quarter ago, it was expected that this bank holding company would post earnings of $1.24 per share when it actually produced earnings of $1.36, delivering a surprise of 9.68%. While Customers Bancorp h ...

Financial Performance - Q1 2025 net income available to common shareholders was $9.5 million, or $0.29 per diluted share, a decrease of 59.1% from Q4 2024[3] - Core earnings for Q1 2025 were $50.0 million, or $1.54 per diluted share, representing a 13.2% increase from Q4 2024[3] - Net income available for common shareholders decreased to $9.5 million, down 79.3% from $45.9 million year-over-year[12] - GAAP net income for Q1 2025 was $9,523,000, translating to $0.29 per share, a decrease from $23,266,000 ($0.71 per share) in Q4 2024[77] - Core earnings for Q1 2025 increased to $50,002,000, or $1.54 per share, compared to $44,168,000 ($1.36 per share) in Q4 2024, representing a 4% increase[77] Asset and Loan Growth - Total assets increased by $1.1 billion, or 5.0%, to $22.4 billion compared to the previous year[12] - Total loans and leases reached $15.1 billion, up $2.2 billion, or 16.8%, year-over-year[16] - Total loans and leases held for investment grew by $611.7 million, or 4.2%, in Q1 2025 from Q4 2024[3] - Loans and leases receivable, net of allowance for credit losses, reached $14,919,363 thousand as of March 31, 2025, up from $14,311,987 thousand in Q4 2024, marking a growth of 4.2%[66] Deposit Trends - Total deposits increased by $86.5 million, or 0.5%, in Q1 2025 from Q4 2024[3] - Total deposits increased to $18,932,925 thousand as of March 31, 2025, compared to $18,846,461 thousand at the end of Q4 2024, reflecting a growth of 0.5%[66] - Money market deposits rose by $213.0 million, or 5.5%, to $4.1 billion, while savings deposits increased by $196.0 million, or 17.3%, to $1.3 billion[29] Credit Quality and Losses - Provision for credit losses was $28.3 million in Q1 2025, up from $21.2 million in Q4 2024[3] - The allowance for credit losses on loans and leases was $141.1 million, an increase of $4.3 million from the previous quarter[18] - Net charge-offs increased to $17.1 million in Q1 2025, compared to $14.6 million in Q4 2024[18] - Non-performing loans (NPLs) as of March 31, 2025, were $43.5 million, slightly up from $43.3 million at December 31, 2024, and increased from $35.7 million a year ago[22] Capital Ratios - Common Equity Tier 1 (CET 1) ratio was 11.7% at March 31, 2025, down from 12.1% at December 31, 2024[3] - Common equity Tier 1 capital ratio decreased to 11.7%, down from 12.6% year-over-year[12] - The CET 1 capital ratio was estimated at 11.7% and the total risk-based capital ratio at 14.6% as of March 31, 2025[38] Efficiency and Cost Management - The efficiency ratio improved to 52.94%, down from 54.58% year-over-year[12] - Non-interest expenses totaled $102.8 million in Q1 2025, a decrease of $7.6 million compared to Q4 2024, primarily due to lower salaries and employee benefits[47] - The core efficiency ratio improved to 52.69% in Q1 2025 from 56.12% in Q4 2024[84] Interest Income and Margin - Net interest income totaled $167.4 million in Q1 2025, a decrease of $0.4 million from Q4 2024, but an increase of $7.1 million from Q1 2024[39][42] - Net interest margin (NIM) increased by 2 basis points to 3.13% in Q1 2025 from 3.11% in Q4 2024[3] - Total interest income for Q1 2025 was $314,909 thousand, a decrease of 4.5% from Q4 2024's $329,906 thousand[65] Stock Performance - The stock price as a percentage of book value was 92% in Q1 2025, up from 90% in Q4 2024[62] - Book value per common share increased by $5.56, or 11.3%, to $54.85[12] Company Recognition - Customers Bancorp, Inc. ranked No. 1 on American Banker’s 2024 list of top-performing banks with $10B to $50B in assets[59]

Financial Performance - As of December 31, 2024, Customers Bancorp had total assets of $22.3 billion, total loans and leases net of the allowance for credit losses (ACL) of $14.5 billion, total deposits of $18.8 billion, and shareholders' equity of $1.8 billion[26]. - Customers Bank funded $22.1 billion and $20.1 billion of mortgage loans to mortgage originators in 2024 and 2023, respectively[47]. - As of December 31, 2024, Customers Bank had $13.2 billion in commercial loans outstanding, representing approximately 90.1% of its total loan portfolio[50]. - Customers originated $4.0 billion and $2.9 billion of commercial and industrial loans in 2024 and 2023, respectively[50]. - The non-performing loans as of December 31, 2024, were only $43.3 million, or 0.30% of the total loan portfolio[40]. - Customers had $1.4 billion in consumer loans outstanding as of December 31, 2024, comprising 9.9% of its total loan portfolio[54]. - The multifamily loans outstanding were $2.3 billion and $2.1 billion as of December 31, 2024 and 2023, respectively[49]. - Customers' commercial equipment financing group had $675.4 million and $547.0 million of equipment finance loans outstanding as of December 31, 2024 and 2023, respectively[48]. Growth Strategy - In 2023, Customers Bancorp expanded its venture banking client coverage by recruiting teams that originated a venture banking loan portfolio purchased from the FDIC, enhancing services in key markets such as Austin, the Bay Area, Boston, Southern California, Chicago, Denver, Raleigh/Durham, and Washington, D.C.[33]. - Customers Bancorp onboarded 10 experienced commercial and business banking teams in 2024 to accelerate deposit growth, enhancing its presence in New York City, Los Angeles, Orange County, and Reno and Las Vegas, Nevada[34]. - The Bank's strategy focuses on organic core loan and deposit growth, with a commitment to a high-tech/high-touch service model supported by state-of-the-art technology[35]. - Customers Bancorp has not acquired any banks since 2011 but continues to evaluate opportunistic acquisitions and team lift-outs to enhance its market presence[36]. - Customers Bancorp's target markets are characterized by attractive demographic, economic, and competitive dynamics, supporting its growth strategies[35]. Corporate Social Responsibility - Customers Bancorp's corporate social responsibility practices emphasize commitment to team members, customers, shareholders, and the communities it serves[27]. - The company distributed $70,000 among 14 team members' children through the Freedom Scholarship Program in 2024[84]. - More than one-third of team members participated in wellness initiatives during 2024, with 96 successfully maximizing their wellness points[80]. - Customers Bank's commitment to corporate social responsibility includes promoting sound governance and investing in team members[65]. - The company offers a variety of health, life, and disability insurance programs to support team members and their families[81]. Team and Management - The management team, led by CEO Jay Sidhu, has significant experience in building banking organizations and integrating mergers and acquisitions[29]. - The management team has extensive experience, having successfully integrated over 30 institutions and numerous asset acquisitions[40]. - Customers Bank's total team members increased from 714 in 2023 to 793 in 2024, with a voluntary turnover rate of 11.2%[67]. - In 2024, Customers Bank welcomed 247 new team members, focusing on deposit generation and risk compliance[69]. - The bank's succession planning focuses on developing internal talent for key executive positions, ensuring a sustainable leadership pipeline[86]. - The bank is actively identifying high-potential team members for succession, emphasizing technical abilities and leadership attributes[88]. Regulatory Compliance - Customers Bank has assets exceeding $10 billion, subjecting it to higher FDIC premium assessments and regulatory scrutiny from the CFPB[92]. - The minimum capital level requirements under Basel III include a common equity Tier 1 risk-based capital ratio of 4.5% and a total risk-based capital ratio of 8%[106]. - The cumulative CECL capital transition impact as of December 31, 2021, amounted to $61.6 million, with a phased-in benefit of $15.4 million expected by December 31, 2024[109]. - The final rules established a capital conservation buffer of 2.5% for 2019 and thereafter, impacting dividend payments and share repurchases if capital levels fall below minimum requirements[104]. - The prompt corrective action framework requires insured depository institutions to meet increased capital level requirements to qualify as "well capitalized"[107]. - Customers Bank has adopted a Code of Ethics and Business Conduct applicable to its directors and officers, ensuring compliance with governance standards[89]. - Federal banking laws regulate the scope of the bank's business, including mergers and acquisitions, which are subject to concentration limits[94]. - The Federal Reserve Board's leverage ratio rules require a minimum Tier 1 leverage ratio of 4% for banks not rated the highest in capital and asset quality[100]. - Customers Bank and the Bancorp met all capital adequacy requirements as of December 31, 2024 and 2023[111]. - The Dodd-Frank Act requires a common equity Tier 1 capital ratio of 6.5%, a Tier 1 risk-based capital ratio of 8%, and a total risk-based capital ratio of 10%[111]. Interest Rate Risk - The Bank's net interest income is significantly impacted by interest rate sensitivity, with management focused on optimizing income while minimizing interest rate risk[565]. - Estimated net interest income for the twelve months ending December 31, 2025 and 2024 is based on existing assets, liabilities, and off-balance sheet financial instruments[568]. - Under upward rate shocks, the projected net interest income increases by 8.4% for 2024 and 9.9% for 2023 with a 3% increase in rates[570]. - Under downward rate shocks, the projected net interest income decreases by 13.6% for 2024 and 11.2% for 2023 with a 3% decrease in rates[570]. - The estimated change in Economic Value of Equity (EVE) shows a decrease of 5.5% for 2024 and 6.2% for 2023 under a 3% upward rate shock[571]. - Under a 3% downward rate shock, the EVE decreases by 15.8% for 2024 and 23.1% for 2023[571]. - Management believes the assumptions used in evaluating interest rate risk are reasonable, but actual results may vary significantly[571]. - The modeling includes a parallel and sustained shift in interest rates for both upward and downward scenarios[569]. - The analysis considers customer preferences and general market conditions in addition to interest rate changes[568]. - The company uses income scenario modeling to measure interest rate sensitivity and manage interest rate risk[567]. - The estimated percentage changes in net interest income are critical for assessing the impact of interest rate fluctuations on financial performance[570].

Core Viewpoint - Customers Bancorp (CUBI) has been upgraded to a Zacks Rank 2 (Buy), indicating a positive outlook on its earnings estimates, which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Price Movement - The Zacks rating system is based on changes in earnings estimates, which are closely correlated with stock price movements, particularly due to institutional investors adjusting their valuations based on these estimates [4][6]. - An increase in earnings estimates typically leads to higher fair value for a stock, prompting institutional investors to buy or sell, thus affecting stock prices [4]. Company Performance Indicators - Customers Bancorp is projected to earn $6.45 per share for the fiscal year ending December 2025, reflecting a year-over-year increase of 15.2% [8]. - Over the past three months, the Zacks Consensus Estimate for Customers Bancorp has risen by 3.1%, indicating a positive trend in earnings expectations [8]. Zacks Rating System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with only the top 20% receiving a 'Strong Buy' or 'Buy' rating, suggesting superior earnings estimate revisions [9][10]. - The upgrade of Customers Bancorp to a Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, indicating potential for market-beating returns in the near term [10].

Core Viewpoint - An investigation is underway regarding the Board of Directors of Customers Bancorp, Inc. for potential breaches of fiduciary duties to the company and its shareholders [1] Group 1: Investigation Details - Berger Montague is advising shareholders about the investigation into Customers Bancorp's Board of Directors [1] - Shareholders can contact Berger Montague for more information regarding the investigation [2] Group 2: Regulatory Actions - On August 8, 2024, the Federal Reserve announced an enforcement action against Customers Bancorp due to significant deficiencies in risk management practices and compliance with anti-money laundering laws [3] - A consent order from the Commonwealth of Pennsylvania indicated that these deficiencies suggested unsafe or unsound banking practices related to BSA/AML requirements [3] Group 3: Whistleblower Information - Whistleblowers with non-public information about Customers Bancorp are encouraged to assist in the investigation and may receive rewards under the SEC Whistleblower program [3]

Core Viewpoint - Customers Bancorp, Inc. is facing allegations of inadequate anti-money laundering practices, leading to regulatory risks and misleading statements about its business operations and prospects [2]. Group 1: Allegations and Class Period - The class period for the allegations against Customers Bancorp is from March 1, 2024, to August 8, 2024 [2]. - The complaint claims that Customers Bancorp failed to disclose its inadequate anti-money laundering practices, which resulted in non-compliance with legal obligations and increased regulatory risk [2]. Group 2: Shareholder Actions - Shareholders who purchased shares of Customers Bancorp during the class period are encouraged to register for the class action and may seek lead plaintiff status [1][3]. - The deadline for shareholders to register and seek lead plaintiff status is January 31, 2025 [3]. Group 3: Law Firm's Role - The Gross Law Firm is a nationally recognized class action law firm dedicated to protecting investors' rights against deceit and fraud [4]. - The firm aims to recover losses for investors caused by misleading statements or omissions that artificially inflated the company's stock [4].

Core Viewpoint - A securities class action lawsuit has been filed against Customers Bancorp, Inc. for alleged misleading statements and inadequate anti-money laundering practices during the specified Class Period [1][4]. Company Overview - Customers Bancorp is a bank holding company headquartered in West Reading, PA [3]. Lawsuit Details - The lawsuit covers purchasers of Customers Bancorp securities from March 1, 2024, to August 8, 2024 [1]. - Allegations include that Customers Bancorp had inadequate anti-money laundering practices and was not in compliance with legal obligations, leading to increased regulatory risk [4]. Participation Information - Investors who purchased securities during the Class Period can seek to be appointed as lead plaintiff by January 31, 2025 [3]. - A lead plaintiff represents the interests of all class members and selects counsel for the litigation [5].

Core Viewpoint - Rosen Law Firm is reminding investors who purchased Customers Bancorp, Inc. securities between March 1, 2024, and August 8, 2024, of the upcoming lead plaintiff deadline for a securities class action lawsuit [1]. Group 1: Class Action Details - Investors who purchased Customers Bancorp securities during the specified Class Period may be entitled to compensation without any out-of-pocket fees through a contingency fee arrangement [2]. - A class action lawsuit has already been filed, and interested parties must move the Court to serve as lead plaintiff by January 31, 2025 [3]. - The lawsuit alleges that Customers Bancorp made materially false and misleading statements regarding its anti-money laundering practices and regulatory compliance, which led to investor damages when the truth was revealed [5]. Group 2: Rosen Law Firm's Credentials - Rosen Law Firm emphasizes the importance of selecting qualified legal counsel with a successful track record in securities class actions, highlighting its own achievements in this area [4]. - The firm has secured significant settlements for investors, including over $438 million in 2019 alone, and has been consistently ranked among the top firms for securities class action settlements since 2013 [4].