Middle Coast Investing, an investment advisor firm, released its third-quarter 2025 investor letter. A copy of the letter can be downloaded here. The third quarter was favorable for Middle Coast Investing. Its collective portfolio outperformed the S&P 500 and is ahead of benchmarks year to date. In Q3 2025, the US Portfolios returned 9.6% compared to 7.8% for the S&P 500. It’s Core U.S. portfolios returned 10% while the Russell 2000 returned 12%, the S&P 600 returned 8.7% and the Nasdaq generated 11.2% for ...

[Glossary of Terms](index=3&type=section&id=Glossary%20of%20Terms) This section provides a list of acronyms and defined terms used throughout the document to assist the reader in understanding the financial report [PART I – FINANCIAL INFORMATION](index=4&type=section&id=PART%20I%20%E2%80%93%20FINANCIAL%20INFORMATION) This part presents the unaudited interim consolidated financial statements and management's discussion and analysis of the company's financial condition and operating results [Item 1. Financial Statements (unaudited)](index=4&type=section&id=Item%201.%20Financial%20Statements%20(unaudited)) This section presents the unaudited interim consolidated financial statements of TFS Financial Corporation and its subsidiaries, including the Statements of Condition, Income, Comprehensive Income (Loss), Shareholders' Equity, and Cash Flows, along with detailed notes explaining the basis of presentation, key accounting policies, and financial instrument details [Consolidated Statements of Condition](index=4&type=section&id=Consolidated%20Statements%20of%20Condition) This statement provides a snapshot of the company's assets, liabilities, and shareholders' equity at specific points in time | Metric | June 30, 2025 (in thousands) | September 30, 2024 (in thousands) | | :--------------------------------- | :----------------------------- | :-------------------------------- | | **ASSETS** | | | | Cash and cash equivalents | $452,581 | $463,718 | | Investment securities available for sale | $525,212 | $526,251 | | Loans, net | $15,595,997 | $15,322,059 | | Total Assets | $17,375,666 | $17,090,785 | | **LIABILITIES AND SHAREHOLDERS' EQUITY** | | | | Deposits | $10,341,499 | $10,195,079 | | Borrowed funds | $4,882,993 | $4,792,847 | | Total Liabilities | $15,487,660 | $15,228,161 | | Total Shareholders' Equity | $1,888,006 | $1,862,624 | | Total Liabilities and Shareholders' Equity | $17,375,666 | $17,090,785 | [Consolidated Statements of Income](index=5&type=section&id=Consolidated%20Statements%20of%20Income) This statement details the company's revenues, expenses, and net income over specific reporting periods | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Nine Months Ended June 30, 2025 (in thousands) | Nine Months Ended June 30, 2024 (in thousands) | | :--------------------------------- | :------------------------------------ | :------------------------------------ | :----------------------------------- | :----------------------------------- | | Total interest and dividend income | $191,407 | $184,906 | $564,127 | $545,558 | | Total interest expense | $116,413 | $115,633 | $348,756 | $335,815 | | NET INTEREST INCOME | $74,994 | $69,273 | $215,371 | $209,743 | | Provision (release) for credit losses | $1,500 | $(500) | $1,500 | $(2,500) | | Total non-interest income | $7,048 | $6,245 | $20,619 | $18,282 | | Total non-interest expense | $53,185 | $50,788 | $152,214 | $153,263 | | INCOME BEFORE INCOME TAXES | $27,357 | $25,230 | $82,276 | $77,262 | | INCOME TAX EXPENSE | $5,844 | $5,277 | $17,316 | $15,889 | | NET INCOME | $21,513 | $19,953 | $64,960 | $61,373 | | Earnings per share—basic and diluted | $0.08 | $0.07 | $0.23 | $0.22 | [Consolidated Statements of Comprehensive Income (Loss)](index=6&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)) This statement presents net income and other comprehensive income items, reflecting the total change in equity from non-owner sources | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Nine Months Ended June 30, 2025 (in thousands) | Nine Months Ended June 30, 2024 (in thousands) | | :--------------------------------- | :------------------------------------ | :------------------------------------ | :----------------------------------- | :----------------------------------- | | Net income | $21,513 | $19,953 | $64,960 | $61,373 | | Total other comprehensive income (loss) | $(16,797) | $196 | $(397) | $(42,598) | | Total comprehensive income | $4,716 | $20,149 | $64,563 | $18,775 | [Consolidated Statements of Shareholders' Equity](index=7&type=section&id=Consolidated%20Statements%20of%20Shareholders'%20Equity) This statement tracks changes in the company's equity accounts, including net income, dividends, and other comprehensive income | Metric | June 30, 2025 (in thousands) | September 30, 2024 (in thousands) | | :--------------------------------- | :----------------------------- | :-------------------------------- | | Balance at beginning of period (Sept 30, 2024) | $1,862,624 | $1,927,361 (Sept 30, 2023) | | Net Income | $64,960 | $61,373 | | Other comprehensive income (loss), net of tax | $(397) | $(42,598) | | Dividends declared to common shareholders | $(44,707) | $(44,173) | | Balance at end of period (June 30, 2025) | $1,888,006 | $1,915,064 (June 30, 2024) | [Consolidated Statements of Cash Flows](index=9&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) This statement categorizes cash inflows and outflows from operating, investing, and financing activities over a period | Metric | Nine Months Ended June 30, 2025 (in thousands) | Nine Months Ended June 30, 2024 (in thousands) | | :--------------------------------- | :------------------------------------ | :------------------------------------ | | Net cash provided by operating activities | $93,522 | $147,280 | | Net cash used in investing activities | $(310,366) | $(12,839) | | Net cash provided by (used in) financing activities | $205,707 | $(40,752) | | NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS | $(11,137) | $93,689 | | CASH AND CASH EQUIVALENTS—End of period | $452,581 | $560,435 | [Notes to Unaudited Interim Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Unaudited%20Interim%20Consolidated%20Financial%20Statements) These notes provide essential details and explanations for the figures presented in the interim consolidated financial statements [1. Basis of Presentation](index=11&type=section&id=1.%20BASIS%20OF%20PRESENTATION) This section outlines the company's primary business activities and the accounting principles and estimates used in preparing the financial statements - TFS Financial Corporation operates primarily in retail consumer banking, including mortgage lending and deposit gathering, with Third Federal Savings, MHC owning approximately **80.9%** of its outstanding shares as of June 30, 2025[21](index=21&type=chunk) - The financial statements adhere to U.S. GAAP, requiring management estimates and assumptions, particularly for the allowance for credit losses, deferred tax assets, and pension obligations[22](index=22&type=chunk) [2. Earnings Per Share](index=11&type=section&id=2.%20EARNINGS%20PER%20SHARE) This section details the calculation of basic and diluted earnings per share, including the shares outstanding | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Nine Months Ended June 30, 2025 | Nine Months Ended June 30, 2024 | | :--------------------------------- | :------------------------------- | :------------------------------- | :------------------------------ | :------------------------------ | | Basic EPS | $0.08 | $0.07 | $0.23 | $0.22 | | Diluted EPS | $0.08 | $0.07 | $0.23 | $0.22 | | Basic Weighted Average Shares Outstanding | 278,832,875 | 278,291,376 | 278,699,423 | 278,104,352 | | Diluted Weighted Average Shares Outstanding | 279,873,274 | 279,221,360 | 279,716,745 | 279,072,087 | - Outstanding shares for EPS calculation include public shares, allocated ESOP shares, and shares held by Third Federal Savings, MHC. Diluted EPS also accounts for dilutive stock options and restricted/performance share units[26](index=26&type=chunk) [3. Investment Securities](index=12&type=section&id=3.%20INVESTMENT%20SECURITIES) This section provides a breakdown of the company's investment securities portfolio, including fair values and unrealized gains or losses | Category | Amortized Cost (June 30, 2025) | Fair Value (June 30, 2025) | Amortized Cost (Sept 30, 2024) | Fair Value (Sept 30, 2024) | | :--------------------------------- | :----------------------------- | :------------------------- | :----------------------------- | :------------------------- | | REMICs | $483,774 | $459,937 | $476,680 | $449,401 | | Fannie Mae certificates | $2,658 | $2,739 | $2,810 | $2,945 | | Freddie Mac certificates | $8,477 | $8,533 | $1,138 | $1,129 | | U.S. government and agency obligations | $54,129 | $54,003 | $72,931 | $72,776 | | Total | $549,038 | $525,212 | $553,559 | $526,251 | - The investment portfolio consists entirely of U.S. government entities and agencies securities. Unrealized losses are primarily due to increased market interest rates, not credit quality deterioration, and no allowance for credit losses was recorded as there is no intent to sell prior to recovery[35](index=35&type=chunk)[36](index=36&type=chunk) [4. Loans and Allowance for Credit Losses](index=14&type=section&id=4.%20LOANS%20AND%20ALLOWANCE%20FOR%20CREDIT%20LOSSES) This section details the composition of the loan portfolio and the methodology and balances of the allowance for credit losses [Loan Portfolios](index=14&type=section&id=LOAN%20PORTFOLIOS) This section provides a detailed breakdown of the company's loan portfolio by type and geographic concentration | Loan Type | June 30, 2025 (in thousands) | September 30, 2024 (in thousands) | | :--------------------------------- | :----------------------------- | :-------------------------------- | | Residential Core | $10,969,930 | $11,385,142 | | Home equity lines of credit | $3,881,132 | $3,323,381 | | Home equity loans | $695,004 | $561,926 | | Construction | $14,506 | $21,701 | | Total Loans held for investment, net | $15,595,997 | $15,322,059 | - A significant portion of the Company's lending is concentrated in Ohio (**59%** of residential/construction loans) and Florida (**17%** of residential/construction loans). Home equity loans and lines of credit are also concentrated in Ohio, Florida, and California[39](index=39&type=chunk)[40](index=40&type=chunk) - Adjustable-rate mortgage (ARM) loans, specifically 'Smart Rate' loans, constituted **$4.06 billion** at June 30, 2025, representing a key component of the residential real estate portfolio with inherent interest rate risk management features[41](index=41&type=chunk) [Delinquency and Non-Accrual](index=16&type=section&id=DELINQUENCY%20and%20NON-ACCRUAL) This section reports on the status of delinquent and non-accrual loans, including criteria for non-accrual classification and related interest income | Delinquency Status | June 30, 2025 (in thousands) | September 30, 2024 (in thousands) | | :--------------------------------- | :----------------------------- | :-------------------------------- | | 30-59 Days Past Due | $14,105 | $12,502 | | 60-89 Days Past Due | $4,363 | $5,452 | | 90 Days or More Past Due | $15,800 | $13,934 | | Total Past Due | $34,268 | $31,888 | | Total Non-accrual loans | $37,254 | $33,610 | - Loans are placed in non-accrual status when they are **90 days or more past due**, or under specific conditions like partial charge-offs, high debt-to-income modifications, or Chapter 7 bankruptcy filings[47](index=47&type=chunk) - Interest income recognized on non-accrual loans was **$757 thousand** for the nine months ended June 30, 2025, an increase from **$507 thousand** for the same period in 2024[50](index=50&type=chunk) [Allowance for Credit Losses](index=17&type=section&id=ALLOWANCE%20FOR%20CREDIT%20LOSSES) This section details the methodology for estimating the allowance for credit losses and presents its components and changes over time - The allowance for credit losses (ACL) is estimated using loan-level regression models with forecasted economic data to determine probability of default and loss given default over a **24-month period**, reverting to historical mean loss rates thereafter[51](index=51&type=chunk) - Qualitative adjustments are made to historical loss information for current loan-specific risk characteristics and expected changes in environmental conditions, resulting in a net reduction to ACL of **$3.38 million** at June 30, 2025, compared to **$5.52 million** at September 30, 2024[52](index=52&type=chunk) | Metric | June 30, 2025 (in thousands) | June 30, 2024 (in thousands) | | :--------------------------------- | :----------------------------- | :----------------------------- | | Beginning Balance (Nine Months) | $70,002 | $77,315 | | Provision (Release) for Credit Losses on Loans | $(520) | $(3,148) | | Charge-offs on real estate loans | $(817) | $(1,014) | | Recoveries on real estate loans | $3,875 | $4,638 | | Ending Balance (Loans) | $72,540 | $67,529 | | Ending Balance (Unfunded Commitments) | $29,831 | $28,163 | | Total Allowance for Credit Losses | $102,371 | $95,692 | [Classified Loans](index=20&type=section&id=CLASSIFIED%20LOANS) This section categorizes loans based on internal credit risk grades and reports on the volume of home equity lines of credit converted to term loans | Loan Classification | June 30, 2025 (in thousands) | September 30, 2024 (in thousands) | | :--------------------------------- | :----------------------------- | :-------------------------------- | | Pass | $15,603,677 | $15,336,689 | | Special Mention | $8,359 | $7,063 | | Substandard | $48,756 | $42,604 | | Total Real Estate Loans | $15,660,792 | $15,386,356 | - Loans are internally graded as Pass, Special Mention (potential weakness), or Substandard (inadequately protected). Loss loans are charged off when uncollectible[74](index=74&type=chunk) - Home equity lines of credit converted from revolving to term loans totaled **$11.33 million** for the nine months ended June 30, 2025, an increase from **$6.56 million** for the same period in 2024[73](index=73&type=chunk) [Modifications to Borrowers Experiencing Financial Difficulty](index=22&type=section&id=MODIFICATIONS%20TO%20BORROWERS%20EXPERIENCING%20FINANCIAL%20DIFFICULTY) This section outlines the types of loan modifications offered to financially distressed borrowers and reports on subsequent default rates | Modification Type (Nine Months Ended June 30, 2025) | Total (in thousands) | % of Total Class | | :-------------------------------------------------- | :------------------- | :--------------- | | Term Extension | $1,068 | | | Significant Payment Delay | $2,381 | | | Combination-Rate Reduction & Term Extension | $1,274 | | | Other | $336 | | | Total Modifications | $5,059 | 0.03% | - The Company offers temporary and permanent loan modifications, such as term extensions and significant payment delays, to borrowers experiencing financial difficulty, but generally does not offer principal forgiveness[76](index=76&type=chunk)[77](index=77&type=chunk) | Subsequent Default (Nine Months Ended June 30, 2025) | Total (in thousands) | | :--------------------------------------------------- | :------------------- | | Residential Core | $630 | | Residential Home Today | $46 | | Home equity lines of credit | $31 | | Total | $707 | [5. Deposits](index=26&type=section&id=5.%20DEPOSITS) This section provides a breakdown of the company's deposit portfolio by type and details the use of brokered certificates of deposit | Deposit Type | June 30, 2025 (in thousands) | September 30, 2024 (in thousands) | | :--------------------------------- | :----------------------------- | :-------------------------------- | | Checking accounts | $810,629 | $829,924 | | Savings accounts | $1,101,088 | $1,127,772 | | Money market accounts | $143,339 | $193,074 | | Certificates of deposit | $8,271,633 | $8,021,123 | | Total deposits | $10,341,499 | $10,195,079 | - Brokered CDs, used as a cost-effective funding alternative, totaled **$977.5 million** at June 30, 2025, down from **$1.22 billion** at September 30, 2024. The Association, as a well-capitalized institution, can accept brokered deposits without FDIC restrictions[90](index=90&type=chunk) [6. Borrowed Funds](index=26&type=section&id=6.%20BORROWED%20FUNDS) This section outlines the company's borrowing capacity and outstanding balances from various sources, including maturity profiles | Borrowing Source | Borrowing Capacity (June 30, 2025, in thousands) | Borrowings Outstanding (June 30, 2025, in thousands) | | :--------------------------------- | :--------------------------------------- | :------------------------------------- | | FHLB | $6,633,552 | $4,865,018 | | FRB Cleveland | $530,799 | — | | Fed Funds Purchased | $455,000 | — | | Total Borrowings | $7,619,351 | $4,882,993 | | Maturity Period | Amount (June 30, 2025, in thousands) | Weighted Average Rate | | :--------------------------------- | :----------------------------------- | :-------------------- | | 12 months or less | $1,435,163 | 3.43% | | 13 to 24 months | $950,000 | 3.14% | | 25 to 36 months | $926,162 | 3.76% | | 37 to 48 months | $600,870 | 3.53% | | 49 to 60 months | $951,090 | 3.43% | | Over 60 months | $1,733 | 1.40% | | Total Advances | $4,865,018 | 3.45% | [7. Other Comprehensive Income (Loss)](index=27&type=section&id=7.%20OTHER%20COMPREHENSIVE%20INCOME%20(LOSS)) This section details the components of other comprehensive income (loss) and their reclassification expectations | Component | Three Months Ended June 30, 2025 (in thousands) | Nine Months Ended June 30, 2025 (in thousands) | | :--------------------------------- | :------------------------------------ | :----------------------------------- | | Net change in unrealized gain on securities available for sale | $2,918 | $2,686 | | Net change in cash flow hedges | $(19,715) | $(3,083) | | Total other comprehensive income (loss) | $(16,797) | $(397) | | Balance at end of period | $(16,005) | $(16,005) | - The Company estimates that **$17.56 million** of the amounts reported in Accumulated Other Comprehensive Income (AOCI) will be reclassified as a reduction to interest expense during the twelve months ending June 30, 2026[135](index=135&type=chunk) [8. Income Taxes](index=28&type=section&id=8.%20INCOME%20TAXES) This section reports on the company's effective income tax rate and the impact of Low Income Housing Tax Credit investments - The Company's combined federal and state effective income tax rate was **21.0%** for the nine months ended June 30, 2025, up from **20.6%** for the same period in 2024[97](index=97&type=chunk) - The impact of the Company's investments in Low Income Housing Tax Credit (LIHTC) entities on the provision for income taxes was not material during the nine months ended June 30, 2025 and 2024[99](index=99&type=chunk) [9. Defined Benefit Plan](index=29&type=section&id=9.%20DEFINED%20BENEFIT%20PLAN) This section details the net periodic benefit cost of the company's defined benefit plan and its frozen status | Component of Net Periodic Cost | Three Months Ended June 30, 2025 (in thousands) | Nine Months Ended June 30, 2025 (in thousands) | | :--------------------------------- | :------------------------------------ | :----------------------------------- | | Interest cost | $740 | $2,220 | | Expected return on plan assets | $(1,197) | $(3,590) | | Amortization of net loss | — | — | | Net periodic (benefit) cost | $(457) | $(1,370) | - The Plan was amended to freeze future benefit accruals for participants after December 31, 2011, with no required minimum employer contributions expected for the remainder of fiscal year 2025[100](index=100&type=chunk)[101](index=101&type=chunk) [10. Equity Incentive Plan](index=29&type=section&id=10.%20EQUITY%20INCENTIVE%20PLAN) This section reports on stock-based compensation expenses and the grants made under the company's equity incentive plan | Expense Type | Three Months Ended June 30, 2025 (in thousands) | Nine Months Ended June 30, 2025 (in thousands) | | :--------------------------------- | :------------------------------------ | :----------------------------------- | | Stock option expense | $28 | $84 | | Restricted stock units expense | $654 | $1,973 | | Performance share units expense | $265 | $745 | | Total stock-based compensation expense | $947 | $2,802 | - During the nine months ended June 30, 2025, the Company granted **178,700** restricted stock units, **135,300** performance share units, and **12,000** stock options under the Amended and Restated 2008 Equity Incentive Plan[102](index=102&type=chunk) [11. Commitments and Contingent Liabilities](index=29&type=section&id=11.%20COMMITMENTS%20AND%20CONTINGENT%20LIABILITIES) This section details the company's commitments to originate or acquire loans, unfunded commitments, and potential legal liabilities | Commitment Type | Commitment (June 30, 2025, in thousands) | Allowance (June 30, 2025, in thousands) | | :--------------------------------- | :--------------------------------------- | :-------------------------------------- | | Fixed-rate mortgage loans | $213,030 | $1,105 | | Adjustable-rate mortgage loans | $18,652 | $101 | | Home equity lines of credit | $123,772 | $1,267 | | Home equity loans | $70,989 | $1,490 | | Total Commitments to originate or acquire loans | $426,443 | $3,963 | | Unfunded Commitment Type | Commitment (June 30, 2025, in thousands) | Allowance (June 30, 2025, in thousands) | | :--------------------------------- | :--------------------------------------- | :-------------------------------------- | | Home equity lines of credit | $5,515,011 | $25,828 | | Construction loans | $6,771 | $40 | | Total Unfunded Commitments | $5,521,782 | $25,868 | - The Company is undergoing an escheat audit for Ohio, Kentucky, and Florida, with any potential loss not reasonably estimable as of June 30, 2025. Management believes other legal actions will not have a material adverse effect[109](index=109&type=chunk)[110](index=110&type=chunk) [12. Fair Value](index=30&type=section&id=12.%20FAIR%20VALUE) This section defines fair value, outlines the three-level hierarchy for inputs, and presents fair value measurements for various assets and liabilities - Fair value is defined as the price to sell an asset or transfer a liability in an orderly transaction between market participants. Assets and liabilities are grouped into a **three-level hierarchy** based on input transparency[111](index=111&type=chunk) | Asset/Liability | June 30, 2025 (in thousands) | September 30, 2024 (in thousands) | | :--------------------------------- | :----------------------------- | :-------------------------------- | | Investment securities available for sale | $525,212 | $526,251 | | Mortgage loans held for sale | $29,303 | $10,713 | | Interest rate lock commitments | $597 | $395 | | Forward commitments for the sale of mortgage loans | $(160) | $(72) | - Collateral-dependent loans and real estate owned (REO) are measured at fair value on a nonrecurring basis, primarily using third-party appraisals, and are categorized as **Level 3** due to significant unobservable inputs[115](index=115&type=chunk)[116](index=116&type=chunk) [13. Derivative Instruments](index=35&type=section&id=13.%20DERIVATIVE%20INSTRUMENTS) This section describes the company's use of interest rate swaps for cash flow hedging and other derivatives not designated as hedging instruments - The Company uses interest rate swaps as cash flow hedges to manage interest rate risk on borrowings and brokered CDs, aiming to stabilize interest expense. These derivatives are settled daily, bringing their fair value to **$0**[129](index=129&type=chunk)[130](index=130&type=chunk) | Derivative Type | Notional Value (June 30, 2025, in thousands) | Notional Value (Sept 30, 2024, in thousands) | | :--------------------------------- | :--------------------------------------- | :--------------------------------------- | | Total cash flow hedges: Interest rate swaps | $3,650,000 | $3,650,000 | | Total derivatives not designated as hedging instruments | $85,737 | $28,878 | - Derivatives not designated as hedges, such as interest rate lock commitments and forward commitments for loan sales, have gains and losses recognized immediately in the Consolidated Statements of Income[131](index=131&type=chunk)[132](index=132&type=chunk) [14. Recent Accounting Pronouncements](index=38&type=section&id=14.%20RECENT%20ACCOUNTING%20PRONOUNCEMENTS) This section discusses the adoption of new accounting standards and the assessment of their potential impact on the company's financial disclosures - The Company adopted ASU 2023-07, 'Segment Reporting,' effective for fiscal years beginning after December 15, 2023, which did not materially affect its financial statements[138](index=138&type=chunk) - ASU 2023-09, 'Income Taxes,' and ASU 2024-03, 'Expense Disaggregation Disclosures,' have been issued but not yet adopted, with the Company currently assessing their potential impact on disclosures[139](index=139&type=chunk)[140](index=140&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=36&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the Company's financial condition and operating results, discussing key trends, strategies, and critical accounting policies. It covers changes in assets, liabilities, equity, and income statement components for the reported periods, along with an overview of liquidity and capital resources [Forward Looking Statements](index=38&type=section&id=Forward%20Looking%20Statements) This section highlights that the report contains forward-looking statements subject to various risks and uncertainties - The report contains forward-looking statements regarding goals, business plans, growth strategies, credit loss trends, and financial condition, which are subject to significant risks and uncertainties[142](index=142&type=chunk)[143](index=143&type=chunk) - Key risk factors include increased competition, inflation, interest rate changes, general economic conditions, real estate market strength, and regulatory changes[146](index=146&type=chunk) [Overview](index=39&type=section&id=Overview) This section outlines the company's business strategy, strong capital position, and key factors for managing financial risks and operations - TFS Financial Corporation's business strategy focuses on operating as a well-capitalized and profitable financial institution, emphasizing exceptional personal service and core values[145](index=145&type=chunk) - The Company's capital ratios remain strong, exceeding 'Well Capitalized' regulatory requirements, with a Common Equity Tier 1 Capital ratio of **17.75%** at June 30, 2025[149](index=149&type=chunk)[156](index=156&type=chunk) - Key success factors include controlling interest rate risk (through adjustable-rate loans, duration extension of funding, and interest rate swaps), monitoring credit risk, maintaining liquidity, and controlling operating expenses[153](index=153&type=chunk)[160](index=160&type=chunk) [Critical Accounting Policies and Estimates](index=46&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) This section identifies the most critical accounting policies and estimates, emphasizing the significant judgment involved in their application - The most critical accounting policies and estimates involve significant judgments and uncertainties, with the allowance for credit losses being paramount to the Company's financial condition and results of operations[183](index=183&type=chunk) [Allowance for Credit Losses](index=46&type=section&id=Allowance%20for%20Credit%20Losses) This section explains the methodology for the allowance for credit losses and reports on its balance and key related ratios - The allowance for credit losses (ACL) is based on a life-of-loan methodology, comprising quantitative general valuation allowances (GVAs) for loans and off-balance sheet exposures, and qualitative adjustments for uncertainties[184](index=184&type=chunk) - The total allowance for credit losses increased to **$102.4 million** at June 30, 2025, from **$99.9 million** at March 31, 2025, driven by growth in home equity loan portfolios and higher mortgage loss dollars[193](index=193&type=chunk)[194](index=194&type=chunk) | Ratio | June 30, 2025 | September 30, 2024 | | :--------------------------------- | :------------ | :----------------- | | Allowance for credit losses on loans to non-accrual loans | 194.72% | 190.93% | | Allowance for credit losses on loans to total amortized cost in loans | 0.46% | 0.44% | [Lending Activities](index=51&type=section&id=Lending%20Activities) This section provides an overview of the company's loan portfolio, including composition, delinquency trends, and non-performing assets [Loan Portfolio Composition](index=51&type=section&id=Loan%20Portfolio%20Composition) This section details the breakdown of the loan portfolio by type and geographic concentration, including home equity lines of credit | Loan Type | June 30, 2025 (in thousands) | September 30, 2024 (in thousands) | | :--------------------------------- | :----------------------------- | :-------------------------------- | | Residential Core | $10,969,930 | $11,385,142 | | Home equity lines of credit | $3,881,132 | $3,323,381 | | Home equity loans | $695,004 | $561,926 | | Construction loans | $14,506 | $21,701 | | Total loans receivable | $15,605,791 | $15,338,791 | - The Company's loan portfolio shows a high concentration in Ohio and Florida for residential and construction loans, and in Ohio, Florida, and California for home equity products[198](index=198&type=chunk) | Home Equity Lines of Credit in Draw Period (June 30, 2025) | Principal Balance (in thousands) | Percent Delinquent 90 Days or More | Mean CLTV Percent at Origination | Current Mean CLTV Percent | | :--------------------------------------------------------- | :------------------------------- | :--------------------------------- | :------------------------------- | :------------------------ | | Ohio | $835,783 | 0.10% | 60% | 42% | | Florida | $826,838 | 0.12% | 56% | 45% | | California | $648,651 | 0.09% | 59% | 50% | | Other | $1,511,486 | 0.10% | 63% | 51% | | Total | $3,822,758 | 0.10% | 59% | 47% | [Delinquent Loans](index=55&type=section&id=Delinquent%20Loans) This section reports on the trends in delinquent loans, particularly those 90 days or more past due, and attributes increases to economic factors | Delinquency Status | June 30, 2025 (in thousands) | September 30, 2024 (in thousands) | | :--------------------------------- | :----------------------------- | :-------------------------------- | | Total 30-89 Days Delinquent | $18,468 | $17,954 | | Total 90 Days or More Delinquent | $15,800 | $13,934 | | Total Delinquent | $34,268 | $31,888 | - Total loans seriously delinquent (**90 days or more**) were **0.10%** of total net loans at June 30, 2025, slightly up from **0.09%** at September 30, 2024[214](index=214&type=chunk) - An upward trend in delinquencies in the home equity lines of credit portfolio is noted, attributed to recent economic trends and elevated interest rates tied to the prime rate, leading to higher monthly payments for some borrowers[217](index=217&type=chunk) [Non-Performing Assets](index=57&type=section&id=Non-Performing%20Assets) This section presents the company's non-performing assets, including non-accrual loans and real estate owned, and their reconciliation | Non-Performing Asset | June 30, 2025 (in thousands) | September 30, 2024 (in thousands) | | :--------------------------------- | :----------------------------- | :-------------------------------- | | Total non-accrual loans | $37,254 | $33,610 | | Real estate owned | $1,240 | $174 | | Total non-performing assets | $38,494 | $33,784 | | Reconciliation | June 30, 2025 (in thousands) | September 30, 2024 (in thousands) | | :--------------------------------- | :----------------------------- | :-------------------------------- | | Non-Accrual Loans | $37,254 | $33,610 | | Accruing Collateral-Dependent Loans | $11,474 | $9,064 | | Less: Loans Collectively Evaluated | $(5,317) | $(3,097) | | Total Collateral-Dependent loans | $43,411 | $39,577 | [Comparison of Financial Condition at June 30, 2025 and September 30, 2024](index=57&type=section&id=Comparison%20of%20Financial%20Condition%20at%20June%2030%2C%202025%20and%20September%2030%2C%202024) This section analyzes changes in the company's total assets, deposits, and shareholders' equity between the two reporting periods - Total assets increased by **$284.9 million** (**1.7%**) to **$17.38 billion** at June 30, 2025, primarily due to a **$273.9 million** increase in loans held for investment, net[223](index=223&type=chunk)[226](index=226&type=chunk) - Deposits increased by **$146.4 million** (**1.4%**) to **$10.34 billion**, with a **$250.5 million** increase in certificates of deposit partially offset by decreases in other deposit types[230](index=230&type=chunk) - Total shareholders' equity increased by **$25.4 million** (**1.4%**) to **$1.89 billion**, reflecting **$65.0 million** in net income, offset by **$44.7 million** in dividends and a **$0.4 million** net decrease in AOCI[234](index=234&type=chunk) [Comparison of Operating Results for the Three Months Ended June 30, 2025 and 2024](index=59&type=section&id=Comparison%20of%20Operating%20Results%20for%20the%20Three%20Months%20Ended%20June%2030%2C%202025%20and%202024) This section compares the company's net income, net interest income, and provision for credit losses for the three-month periods - Net income increased by **$1.5 million** (**7.5%**) to **$21.5 million**, driven by higher net interest income and non-interest income, partially offset by increased non-interest expense and provision for credit losses[239](index=239&type=chunk) - Net interest income rose by **$5.7 million** to **$75.0 million**, primarily due to a **14 basis point** increase in the yield on interest-earning assets to **4.61%**, while the net interest margin also increased by **14 basis points** to **1.81%**[246](index=246&type=chunk)[248](index=248&type=chunk) - A provision for credit losses of **$1.5 million** was recorded, compared to a release of **$0.5 million** in the prior year, mainly due to growth in equity loan and line of credit portfolios[249](index=249&type=chunk) [Comparison of Operating Results for the Nine Months Ended June 30, 2025 and 2024](index=63&type=section&id=Comparison%20of%20Operating%20Results%20for%20the%20Nine%20Months%20Ended%20June%2030%2C%202025%20and%202024) This section compares the company's net income, net interest income, and non-interest income for the nine-month periods - Net income increased by **$3.6 million** to **$65.0 million**, primarily from higher net interest income and non-interest income, and lower non-interest expense, partially offset by an increased provision for credit losses[257](index=257&type=chunk) - Net interest income increased by **$5.7 million** (**2.7%**) to **$215.4 million**, with the yield on average interest-earning assets rising by **15 basis points** to **4.55%**. The net interest margin was **1.74%** for the current nine months[264](index=264&type=chunk)[265](index=265&type=chunk) - Non-interest income increased by **$2.3 million** (**12.6%**) to **$20.6 million**, mainly due to a **$1.4 million** increase in net gain on loan sales and a **$1.2 million** increase in loan fees and service charges[268](index=268&type=chunk) [Liquidity and Capital Resources](index=65&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses the company's funding sources, liquidity management, and capital ratios, highlighting its well-capitalized status - Primary funding sources include deposit inflows, loan repayments, FHLB advances, FRB-Cleveland Discount Window borrowings, Fed Funds, brokered CDs, and sales of loans and securities[271](index=271&type=chunk)[272](index=272&type=chunk) - The Company maintains a liquidity ratio averaging **5.50%** for the three months ended June 30, 2025, and has sufficient liquidity to meet short- and long-term obligations[273](index=273&type=chunk) | Capital Ratio (Association) | Actual Ratio (June 30, 2025) | Well Capitalized Level | | :--------------------------------- | :--------------------------- | :--------------------- | | Total Capital to Risk-Weighted Assets | 17.37% | 10.00% | | Tier 1 (Leverage) Capital to Net Average Assets | 10.10% | 5.00% | | Tier 1 Capital to Risk-Weighted Assets | 16.51% | 8.00% | | Common Equity Tier 1 Capital to Risk-Weighted Assets | 16.51% | 6.50% | [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=64&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) This section details the Company's management of market risk, primarily interest rate risk, through various strategies and analytical models like Economic Value of Equity (EVE) and Net Interest Income (NII) sensitivity analysis. It outlines the methodologies, assumptions, and estimated impacts of hypothetical interest rate changes on the Company's financial position [General](index=68&type=section&id=General) This section identifies interest rate risk as the company's most significant market risk, managed by the Asset/Liability Management Committee - The Company's most significant market risk is interest rate risk, managed by the Asset/Liability Management Committee and overseen by the Board of Directors, with established risk parameter limits[290](index=290&type=chunk) [Economic Value of Equity](index=68&type=section&id=Economic%20Value%20of%20Equity) This section explains the use of customized modeling software to estimate changes in Economic Value of Equity (EVE) under various interest rate scenarios - The Company uses customized modeling software to estimate changes in the Economic Value of Equity (EVE) under various hypothetical market interest rate changes, using a discounted cash flow and option-based pricing approach[291](index=291&type=chunk) [Net Interest Income](index=68&type=section&id=Net%20Interest%20Income) This section describes the simulation model used to analyze the sensitivity of Net Interest Income (NII) to instantaneous interest rate changes - The simulation model also analyzes the sensitivity of Net Interest Income (NII) to interest rate changes for prospective **12 and 24-month periods**, assuming instantaneous adjustments to market interest rates[293](index=293&type=chunk) [Other Considerations](index=69&type=section&id=Other%20Considerations) This section differentiates between EVE and NII models and presents the estimated impact of hypothetical interest rate changes on both metrics - EVE is a stochastic model providing a long-term, liquidation view of the Company, while NII is based on flat balance sheet projections for one to two years, assuming static volume and pricing[296](index=296&type=chunk) | Change in Interest Rates (basis points) | Estimated EVE (Amount, in thousands) | Estimated EVE (Percentage Change) | Estimated NII (Amount, in thousands) | Estimated NII (Percentage Change) | | :-------------------------------------- | :----------------------------------- | :-------------------------------- | :----------------------------------- | :-------------------------------- | | +200 | $1,098,262 | (25.68)% | $372,089 | 9.40% | | +100 | $1,300,981 | (11.96)% | $356,656 | 4.86% | | 0 | $1,477,771 | —% | $340,127 | —% | | -100 | $1,590,301 | 7.61% | $317,343 | (6.70)% | | -200 | $1,635,863 | 10.70% | $289,144 | (14.99)% | - At June 30, 2025, a **200 basis point** increase in interest rates would result in a **25.68%** decrease in the Company's EVE, while a **200 basis point** decrease would lead to a **10.70%** increase[304](index=304&type=chunk) [Item 4. Controls and Procedures](index=67&type=section&id=Item%204.%20Controls%20and%20Procedures) This section confirms the effectiveness of the Company's disclosure controls and procedures and reports no material changes in internal control over financial reporting during the most recently completed fiscal quarter [Evaluation of Disclosure Controls and Procedures](index=71&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) This section confirms the effectiveness of the company's disclosure controls and procedures as of the reporting date - The Company's principal executive and financial officers concluded that disclosure controls and procedures were effective as of June 30, 2025, ensuring timely and accurate reporting of required information[309](index=309&type=chunk) [Changes in Internal Control over Financial Reporting](index=71&type=section&id=Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) This section states that no material changes occurred in internal control over financial reporting during the most recent fiscal quarter - No material changes in internal control over financial reporting occurred during the most recently completed fiscal quarter[310](index=310&type=chunk) [Part II — OTHER INFORMATION](index=67&type=section&id=Part%20II%20%E2%80%94%20OTHER%20INFORMATION) This part covers legal proceedings, risk factors, equity security sales, and other miscellaneous disclosures [Item 1. Legal Proceedings](index=67&type=section&id=Item%201.%20Legal%20Proceedings) Management's opinion on legal actions indicates no expected material adverse effect on the Company's consolidated financial condition or results of operations - The Company and its subsidiaries are subject to various legal actions in the normal course of business, but management does not expect their resolution to have a material adverse effect on financial condition or results of operations[311](index=311&type=chunk) [Item 1A. Risk Factors](index=67&type=section&id=Item%201A.%20Risk%20Factors) No material changes to the previously disclosed risk factors were identified during the quarter ended June 30, 2025 - There have been no material changes to the risk factors previously disclosed in the Company's Annual Report on Form 10-K for the fiscal year ended September 30, 2024[312](index=312&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=68&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section details the Company's stock repurchase activity and the mutual holding company's dividend waiver approval | Period | Total Number of Shares Purchased | Average Price Paid per Share | | :--------------------------------- | :------------------------------- | :--------------------------- | | June 1, 2025 through June 30, 2025 | 57,500 | $12.87 | - The Company's eighth stock repurchase program, approved on October 27, 2016, authorized the repurchase of up to **10,000,000 shares**, with **5,134,451 shares** remaining to be repurchased at June 30, 2025[314](index=314&type=chunk) - Third Federal Savings, MHC, the mutual holding company and **81%** majority shareholder, approved a waiver of dividends aggregating up to **$1.13 per share** for the twelve months subsequent to July 8, 2025[315](index=315&type=chunk) [Item 3. Defaults Upon Senior Securities](index=68&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This item is not applicable to the Company - This section is marked as 'Not applicable'[317](index=317&type=chunk) [Item 4. Mine Safety Disclosures](index=68&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the Company - This section is marked as 'Not applicable'[317](index=317&type=chunk) [Item 5. Other Information](index=69&type=section&id=Item%205.%20Other%20Information) This section provides information on securities trading plans of directors and executive officers [Securities Trading Plans of Directors and Executive Officers](index=73&type=section&id=Securities%20Trading%20Plans%20of%20Directors%20and%20Executive%20Officers) This section reports on the termination of Rule 10b5-1 trading plans for certain executive officers during the quarter - Two Rule 10b5-1 trading plans, for the Chief Financial Officer and Chief Synergy Officer, were terminated during the quarter ended June 30, 2025, with no new plans adopted[319](index=319&type=chunk)[320](index=320&type=chunk) [Item 6. Exhibits](index=69&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Quarterly Report on Form 10-Q, including financial statements in Inline XBRL format and certifications - The report includes unaudited financial statements formatted in Inline XBRL, along with certifications from the Chief Executive Officer and Chief Financial Officer pursuant to the Sarbanes-Oxley Act[322](index=322&type=chunk)[324](index=324&type=chunk) [SIGNATURES](index=70&type=section&id=SIGNATURES) This section contains the official signatures of the company's principal executive and financial officers, certifying the report - The report is signed by Marc A. Stefanski, Chairman of the Board, President and Chief Executive Officer, and Meredith S. Weil, Chief Financial Officer, on August 7, 2025[327](index=327&type=chunk)

[Executive Summary](index=1&type=section&id=Executive%20Summary) TFS Financial Corporation reported strong third-quarter and year-to-date fiscal 2025 results, driven by increased net interest income and robust loan origination activity, particularly in equity lines of credit. The company maintained a strong capital position, exceeding regulatory requirements [Highlights](index=1&type=section&id=Highlights) TFS Financial Corporation reported strong third-quarter and year-to-date fiscal 2025 results, driven by increased net interest income and robust loan origination activity, particularly in equity lines of credit. The company maintained a strong capital position, exceeding regulatory requirements - Equity lines of credit originations grew **17%** from 2024, indicating strong demand in this segment[2](index=2&type=chunk) - Net interest margin (NIM) improved **six basis points** this quarter to **1.81%**, reaching a nine-quarter high[2](index=2&type=chunk) - The company's Tier 1 capital ratio of nearly **11%** demonstrates a well-capitalized and stable financial position[2](index=2&type=chunk) Key Financial Performance (Q3 2025 & YTD Q3 2025) | Metric | Q3 2025 (Millions) | YTD Q3 2025 (Millions) | | :--------------------- | :------------------ | :-------------------- | | Net Income | $21.5 | $65.0 | [Operating Results](index=1&type=section&id=Operating%20Results) The company's operating results show improved net income and net interest margin across both quarterly and year-to-date comparisons, driven by increased interest income and effective expense management [Operating Results (Q3 2025 vs. Q2 2025)](index=1&type=section&id=Operating%20Results%20for%20the%20Quarter%20Ended%20June%2030%2C%202025) The company reported an increase in net income for the quarter ended June 30, 2025, primarily driven by higher net interest income, despite an increase in non-interest expenses. The net interest margin saw a notable improvement Quarterly Operating Performance (Q3 2025 vs. Q2 2025) | Metric | Q3 2025 (Millions) | Q2 2025 (Millions) | Change (Millions) | Change (%) | | :---------------------- | :----------------- | :----------------- | :---------------- | :--------- | | Net Income | $21.5 | $21.0 | $0.5 | 2.4% | | Net Interest Income | $75.0 | $72.0 | $3.0 | 4.2% | | Provision for Credit Losses | $1.5 | $1.5 | $0.0 | 0.0% | | Non-Interest Expense | $53.2 | $51.1 | $2.1 | 4.1% | - The net interest margin increased by **six basis points** to **1.81%** in Q3 2025, driven by a **ten basis point** increase in the weighted average yield of interest-bearing assets, partially offset by a **five basis point** increase in the cost of interest-bearing liabilities[4](index=4&type=chunk) - The increase in non-interest expense was mainly due to a **$1.2 million** increase in marketing services and a **$1.0 million** increase in other expenses, including loan origination costs[6](index=6&type=chunk) [Operating Results (YTD Q3 2025 vs. YTD Q3 2024)](index=2&type=section&id=Operating%20Results%20for%20the%20Nine%20months%20ended%20June%2030%2C%202025) For the nine months ended June 30, 2025, the company achieved higher net income compared to the prior year, primarily due to increases in net interest income and non-interest income, coupled with a decrease in non-interest expense, despite a higher provision for credit losses Year-to-Date Operating Performance (YTD Q3 2025 vs. YTD Q3 2024) | Metric | YTD Q3 2025 (Millions) | YTD Q3 2024 (Millions) | Change (Millions) | Change (%) | | :---------------------- | :--------------------- | :--------------------- | :---------------- | :--------- | | Net Income | $65.0 | $61.4 | $3.6 | 5.9% | | Net Interest Income | $215.4 | $209.7 | $5.7 | 2.7% | | Provision for Credit Losses | $1.5 | ($2.5) (Release) | $4.0 | N/A | | Non-Interest Income | $20.6 | $18.3 | $2.3 | 12.6% | | Non-Interest Expense | $152.2 | $153.3 | ($1.1) | (0.7)% | - The net interest margin improved to **1.74%** for YTD Q3 2025 from **1.69%** in the prior year, as the yield on interest-earning assets increased more than the cost of interest-bearing liabilities[12](index=12&type=chunk) - The total allowance for credit losses increased by **$4.6 million** to **$102.4 million** (**0.66%** of total loans receivable) at June 30, 2025, primarily due to growth in equity lines of credit and a slight deterioration in economic factors[14](index=14&type=chunk) - Non-interest income growth was mainly driven by a **$1.2 million** increase in fees and service charges (net of amortization) and a **$1.4 million** increase in net gain on the sale of loans[15](index=15&type=chunk) [Financial Condition](index=1&type=section&id=Financial%20Condition) The company's financial condition shows growth in total assets and the loan portfolio, primarily funded by increased borrowed funds and deposits, with a notable shift towards home equity loans [Financial Condition (Q3 2025 vs. Q2 2025)](index=1&type=section&id=Financial%20Condition%20at%20June%2030%2C%202025%20compared%20to%20March%2031%2C%202025) The company's total assets grew quarter-over-quarter, primarily fueled by an increase in loans held for investment and loans held for sale. This growth was funded by an increase in borrowed funds, as deposits experienced a slight decrease Key Balance Sheet Changes (Q3 2025 vs. Q2 2025) | Metric | June 30, 2025 (Billions) | March 31, 2025 (Billions) | Change (Millions) | Change (%) | | :-------------------------- | :----------------------- | :------------------------ | :---------------- | :--------- | | Total Assets | $17.38 | $17.11 | $263.9 | 1.5% | | Loans Held for Investment, net | $15.60 | $15.36 | $235.9 | 1.5% | | Loans Held for Sale | $0.031 | $0.0058 | $25.2 | 434.5% | | Deposits | $10.34 | $10.40 | ($56.1) | (0.5)% | | Borrowed Funds | $4.88 | $4.59 | $295.7 | 6.4% | - Within loans held for investment, home equity loans and lines of credit increased by **$260.9 million** to **$4.58 billion**, while residential core mortgage loans decreased by **$25.0 million** to **$10.97 billion**[8](index=8&type=chunk) - The decrease in deposits was mainly due to decreases in money market, checking, and savings accounts, partially offset by a **$20.4 million** increase in certificates of deposit[9](index=9&type=chunk) [Financial Condition (YTD Q3 2025 vs. FYE 2024)](index=2&type=section&id=Financial%20Condition%20at%20June%2030%2C%202025%20compared%20to%20September%2030%2C%202024) Comparing to the fiscal year-end 2024, total assets increased, primarily driven by growth in the loan portfolio. Deposits also saw an increase, mainly from retail certificates of deposit, while borrowed funds increased to support loan growth Key Balance Sheet Changes (YTD Q3 2025 vs. FYE 2024) | Metric | June 30, 2025 (Billions) | September 30, 2024 (Billions) | Change (Millions) | Change (%) | | :-------------------------- | :----------------------- | :---------------------------- | :---------------- | :--------- | | Total Assets | $17.38 | $17.09 | $284.9 | 1.7% | | Loans Held for Investment, net | $15.60 | $15.32 | $273.9 | 1.8% | | Deposits | $10.34 | $10.20 | $146.4 | 1.4% | | Borrowed Funds | $4.88 | $4.79 | $90.1 | 1.9% | - Home equity loans and lines of credit increased significantly by **$690.8 million** to **$4.58 billion**, while the residential core mortgage loan portfolio decreased by **$415.2 million** to **$10.97 billion**[18](index=18&type=chunk) - Loans originated and acquired during the nine months ended June 30, 2025, included **$760.2 million** of residential mortgage loans and **$1.87 billion** of equity loans and lines of credit[18](index=18&type=chunk) - The increase in deposits was primarily due to a **$250.5 million** increase in retail certificates of deposit, partially offset by decreases in savings, checking, and money market deposit accounts. Brokered deposits decreased from **$1.22 billion** to **$976.5 million**[19](index=19&type=chunk) [Shareholders' Equity and Capital](index=3&type=section&id=Shareholders'%20Equity%20and%20Capital) The company's shareholders' equity increased due to net income, while maintaining strong regulatory capital ratios well above 'well capitalized' thresholds, supported by consistent dividends and a dividend waiver from its MHC [Shareholders' Equity Activity](index=3&type=section&id=Shareholders'%20Equity%20Activity) Total shareholders' equity increased, reflecting net income generation, partially offset by dividends paid and stock repurchases. The company continued its stock repurchase program Shareholders' Equity Activity (YTD Q3 2025) | Metric | June 30, 2025 (Billions) | September 30, 2024 (Billions) | Change (Millions) | Change (%) | | :-------------------------- | :----------------------- | :---------------------------- | :---------------- | :--------- | | Total Shareholders' Equity | $1.89 | $1.86 | $25.4 | 1.4% | | Net Income | $65.0 (YTD) | N/A | N/A | N/A | | Dividends Paid | $44.7 (YTD) | N/A | N/A | N/A | | Stock Repurchases | $0.7 (YTD) | N/A | N/A | N/A | - During the nine months ended June 30, 2025, **57,500 shares** of common stock were repurchased at an average cost of **$12.87 per share**. The company has **5,134,451 shares** remaining authorized for repurchase under its eighth stock repurchase program[21](index=21&type=chunk) [Dividends and MHC Waiver](index=3&type=section&id=Dividends%20and%20MHC%20Waiver) The company declared consistent quarterly dividends, and its mutual holding company (MHC) successfully obtained member approval to waive its share of dividends for the upcoming year, pending Federal Reserve non-objection - A quarterly dividend of **$0.2825 per share** was declared and paid during each of the first three fiscal quarters of 2025[22](index=22&type=chunk) - MHC members approved the waiver of dividends aggregating up to **$1.13 per share** for the twelve months subsequent to July 8, 2025, continuing a twelve-year trend of approximately **97% approval**[22](index=22&type=chunk) [Regulatory Capital Ratios](index=3&type=section&id=Regulatory%20Capital%20Ratios) TFS Financial Corporation continues to maintain capital ratios well above the amounts required to be considered 'well capitalized' under the Basel III capital framework Regulatory Capital Ratios (June 30, 2025) | Capital Ratio | Percentage | | :---------------------- | :--------- | | Tier 1 Leverage Ratio | 10.86% | | Common Equity Tier 1 Ratio | 17.75% | | Tier 1 Ratio | 17.75% | | Total Capital Ratio | 18.61% | - All capital ratios exceed the amounts required for the company to be considered 'well capitalized' for regulatory capital purposes[23](index=23&type=chunk) [Company Information](index=3&type=section&id=Company%20Information) This section provides an overview of TFS Financial Corporation's mission, operational footprint, and investor communication plans, including the availability of presentation slides [About TFS Financial Corporation](index=3&type=section&id=About%20TFS%20Financial%20Corporation) Third Federal Savings and Loan Association, founded in 1938, is a leading provider of savings and mortgage products, operating with a mission to help people achieve home ownership and financial security. It serves customers across 27 states and the District of Columbia - Third Federal Savings and Loan Association operates under values of love, trust, respect, a commitment to excellence, and fun, with a mission to help people achieve home ownership and financial security[25](index=25&type=chunk) - The company lends in **27 states** and the District of Columbia, with **21 full-service branches** in Northeast Ohio, **two lending offices** in Central and Southern Ohio, and **16 full-service branches** throughout Florida[25](index=25&type=chunk) - As of June 30, 2025, the Company's total assets were **$17.38 billion**[25](index=25&type=chunk) [Investor Information](index=3&type=section&id=Investor%20Information) The company will make presentation slides available online for investors but will not host a conference call to discuss its operating results - Presentation slides as of June 30, 2025, will be available on thirdfederal.com under the Investor Relations link beginning July 31, 2025[24](index=24&type=chunk) - The company will not be hosting a conference call to discuss its operating results[24](index=24&type=chunk) [Forward-Looking Statements](index=4&type=section&id=Forward%20Looking%20Statements) This section provides a cautionary statement regarding forward-looking statements, outlining the types of such statements and the significant risks, assumptions, and uncertainties that could cause actual future results to differ materially from those projected - Forward-looking statements include those regarding goals, intentions, expectations, business plans, growth strategies, trends in credit losses, financial condition, and estimates of risks and future costs/benefits[26](index=26&type=chunk)[28](index=28&type=chunk) - Significant risks and uncertainties include increased competition, inflation and interest rate changes, general economic conditions, real estate market strength, demand for products, consumer habits, securities market volatility, risk management, funding access, legislative/regulatory changes, accounting policy changes, new market entry, Fannie Mae/Freddie Mac developments, government policy, cyber-attacks, and the impact of pandemics[27](index=27&type=chunk)[28](index=28&type=chunk) [Financial Statements](index=5&type=section&id=Financial%20Statements) This section presents the company's consolidated financial statements, including the balance sheet, income statements for various periods, and detailed average balances and yields, providing a comprehensive view of its financial performance and position [Consolidated Statements of Condition (Balance Sheet)](index=5&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20CONDITION) This statement provides a snapshot of the company's financial position at various reporting dates, detailing its assets, liabilities, and shareholders' equity Consolidated Statements of Condition (In thousands) | Item | June 30, 2025 | March 31, 2025 | September 30, 2024 | | :------------------------------------ | :------------ | :------------- | :----------------- | | **ASSETS** | | | | | Cash and cash equivalents | $452,581 | $463,583 | $463,718 | | Loans, net | $15,595,997 | $15,360,143 | $15,322,059 | | TOTAL ASSETS | $17,375,666 | $17,111,720 | $17,090,785 | | **LIABILITIES AND SHAREHOLDERS' EQUITY** | | | | | Deposits | $10,341,499 | $10,397,645 | $10,195,079 | | Borrowed funds | $4,882,993 | $4,587,327 | $4,792,847 | | Total liabilities | $15,487,660 | $15,215,063 | $15,228,161 | | Total shareholders' equity | $1,888,006 | $1,896,657 | $1,862,624 | [Consolidated Statements of Income (Income Statement)](index=6&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20INCOME) These statements present the company's revenues, expenses, and net income for both quarterly and year-to-date periods, illustrating its profitability trends [Quarterly Consolidated Statements of Income](index=6&type=section&id=For%20the%20Three%20Months%20Ended) Detailed income statement for the three-month periods, showing revenue and expense components contributing to net income Quarterly Consolidated Statements of Income (In thousands) | Item | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :---------------------------- | :------------ | :------------- | :------------ | | Total interest and dividend income | $191,407 | $185,952 | $184,906 | | Total interest expense | $116,413 | $113,903 | $115,633 | | NET INTEREST INCOME | $74,994 | $72,049 | $69,273 | | PROVISION (RELEASE) FOR CREDIT LOSSES | $1,500 | $1,500 | ($500) | | Total non-interest income | $7,048 | $7,068 | $6,245 | | Total non-interest expense | $53,185 | $51,088 | $50,788 | | NET INCOME | $21,513 | $21,021 | $19,953 | | Earnings per share - basic and diluted | $0.08 | $0.07 | $0.07 | [Nine Months Ended Consolidated Statements of Income](index=7&type=section&id=For%20the%20Nine%20Months%20Ended) Cumulative income statement for the nine-month periods, providing a year-to-date view of financial performance Nine Months Ended Consolidated Statements of Income (In thousands) | Item | June 30, 2025 | June 30, 2024 | | :---------------------------- | :------------ | :------------ | | Total interest and dividend income | $564,127 | $545,558 | | Total interest expense | $348,756 | $335,815 | | NET INTEREST INCOME | $215,371 | $209,743 | | PROVISION (RELEASE) FOR CREDIT LOSSES | $1,500 | ($2,500) | | Total non-interest income | $20,619 | $18,282 | | Total non-interest expense | $152,214 | $153,263 | | NET INCOME | $64,960 | $61,373 | | Earnings per share - Basic | $0.23 | $0.22 | | Earnings per share - Diluted | $0.23 | $0.22 | [Average Balances and Yields](index=8&type=section&id=AVERAGE%20BALANCES%20AND%20YIELDS) These tables provide a detailed breakdown of average balances for interest-earning assets and interest-bearing liabilities, along with their respective yields and costs, offering insights into the company's net interest margin and interest rate sensitivity [Quarterly Average Balances and Yields](index=8&type=section&id=Three%20Months%20Ended) Analysis of average balances and yields for the three-month periods, highlighting key metrics such as interest rate spread and net interest margin Quarterly Average Balances and Yields | Metric | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :-------------------------- | :------------ | :------------- | :------------ | | Total interest-earning assets (Avg. Balance) | $16,615,086 | $16,508,486 | $16,554,661 | | Yield on interest-earning assets | 4.61% | 4.51% | 4.47% | | Total interest-bearing liabilities (Avg. Balance) | $14,978,080 | $14,875,775 | $14,850,809 | | Cost of interest-bearing liabilities | 3.11% | 3.06% | 3.11% | | Net interest income | $74,994 | $72,049 | $69,273 | | Interest rate spread | 1.50% | 1.45% | 1.36% | | Net interest margin | 1.81% | 1.75% | 1.67% | | Return on average assets | 0.50% | 0.49% | 0.47% | | Return on average equity | 4.49% | 4.35% | 4.08% | [Nine Months Ended Average Balances and Yields](index=10&type=section&id=Nine%20Months%20Ended) Analysis of average balances and yields for the nine-month periods, providing insights into year-to-date trends in interest rate spread and net interest margin Nine Months Ended Average Balances and Yields | Metric | June 30, 2025 | June 30, 2024 | | :-------------------------- | :------------ | :------------ | | Total interest-earning assets (Avg. Balance) | $16,538,099 | $16,538,130 | | Yield on interest-earning assets | 4.55% | 4.40% | | Total interest-bearing liabilities (Avg. Balance) | $14,894,032 | $14,872,098 | | Cost of interest-bearing liabilities | 3.12% | 3.01% | | Net interest income | $215,371 | $209,743 | | Interest rate spread | 1.43% | 1.39% | | Net interest margin | 1.74% | 1.69% | | Return on average assets | 0.51% | 0.48% | | Return on average equity | 4.51% | 4.22% |

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or ...

Capital and Liquidity - As of March 31, 2025, the company's Common Equity Tier 1 Capital ratio is 18.13%, exceeding the regulatory requirement for being considered "Well Capitalized" [149] - The Association's Tier 1 (leverage) capital ratio was 10.04% as of March 31, 2025, indicating a well-capitalized status [177] - The company exceeded all regulatory capital requirements to be considered "Well Capitalized" as of March 31, 2025, with total capital to risk-weighted assets at 17.58% [282] - The liquidity ratio averaged 5.60% for the three months ended March 31, 2025, exceeding the minimum target of 5% [268] - The company has a combined additional borrowing capacity of $3.06 billion as of March 31, 2025, from various sources [151] - As of March 31, 2025, the company had the ability to borrow a maximum of $6.67 billion from the FHLB of Cincinnati and $565.0 million from the FRB-Cleveland Discount Window [179] Loan Portfolio and Performance - As of March 31, 2025, total loans receivable amounted to $15.37 billion, with a weighted average yield of 4.60% [163] - The balance of first mortgage loans held for investment is $11.03 billion as of March 31, 2025, compared to $11.43 billion as of September 30, 2024 [161] - The company’s ARM loans (primarily Smart Rate) account for 37.7% of the total first mortgage loans held for investment as of March 31, 2025 [161] - The average credit score for first mortgage loans originated during the current quarter was 777, with an average loan-to-value (LTV) ratio of 68% [175] - The total residential Core loan portfolio amounted to $10,994.9 million, representing 71.6% of total loans as of March 31, 2025 [199] - The home equity lines of credit portfolio increased by 10.5% to $3,671.4 million as of March 31, 2025 [199] - The total unpaid principal balance of home equity loans was $643.9 million, and home equity lines of credit amounted to $3.67 billion [205] - The total home equity lines of credit in the draw period had a principal balance of $3.61 billion, with 0.12% delinquent for 90 days or more [207] Delinquencies and Credit Losses - As of March 31, 2025, 0.2% of loans originated or acquired, totaling $31.6 million, were delinquent [175] - The percentage of loans seriously delinquent (90 days or more) was 0.10% of total net loans as of March 31, 2025, showing a slight increase from 0.09% at September 30, 2024 [213] - The total allowance for credit losses on loans was $70.5 million as of March 31, 2025, compared to $70.0 million at September 30, 2024 [197] - The allowance for credit losses increased to $99.9 million as of March 31, 2025, from $97.8 million at December 31, 2024 [193] - The total charge-offs for the six months ended March 31, 2025, were $597,000, compared to $751,000 for the same period in 2024 [192] - The total allowance for home equity lines of credit increased by 7.0% to $19.5 million, from $18.2 million at December 31, 2024 [195] Income and Expenses - Net income increased by $0.3 million, or 1%, to $21.0 million for the quarter ended March 31, 2025 [236] - Interest and dividend income increased by $2.5 million, or 1%, to $186.0 million during the current quarter [238] - Non-interest income rose by $1.4 million, or 24%, to $7.1 million, primarily due to increases in net gain on loan sales and cash surrender value from bank-owned life insurance contracts [247] - Non-interest expense decreased by $1.1 million, or 2%, to $51.1 million, driven by reductions in marketing and other operating expenses [248] - Net interest income increased by $0.6 million to $72.0 million, mainly due to an increase in the yield of interest-earning assets [243] Interest Rate Sensitivity - The estimated Economic Value of Equity (EVE) for TFS Financial Corporation would decrease by 27.19% to $993,310 in the event of a 200 basis point increase in interest rates [297] - For Third Federal Savings and Loan Association, a 200 basis point increase in interest rates would result in a 31.32% decrease in EVE to $812,351 [299] - The estimated Net Interest Income (NII) for TFS Financial Corporation would increase by 11.85% to $324,206 with a 200 basis point increase in interest rates [297] - The estimated NII for Third Federal Savings and Loan Association would increase by 11.10% to $312,510 under the same interest rate scenario [299] - The simulation model used for EVE and NII sensitivity analyses incorporates numerous assumptions regarding market interest rates, loan prepayments, and deposit decay [290] Operational Efficiency - The ratio of annualized non-interest expense to average assets was 1.16% for the six months ended March 31, 2025, down from 1.20% for the same period in 2024 [181] - Average deposits per full-time employee were $11.1 million as of March 31, 2025, with average assets per full-time employee at $18.2 million [181] - Non-interest expense decreased by $3.5 million, or 3%, to $99.0 million during the six months ended March 31, 2025, from $102.5 million in the prior year [264] Market and Strategic Initiatives - The company actively markets home equity lines of credit to manage interest rate risk and increase loan portfolio yield [165] - The company has extended its lending activities to 25 other states and the District of Columbia to reduce concentration risk in Ohio and Florida [176] - The company plans to continue dividend payments and strategic stock repurchases as part of its future capital deployment activities [285]

Core Viewpoint - TFS Financial (TFSL) shows potential as a strong investment opportunity due to significant revisions in earnings estimates, indicating an improving earnings outlook [1][2]. Earnings Estimate Revisions - Analysts have become increasingly optimistic about TFS Financial's earnings prospects, leading to a rising trend in estimate revisions, which is expected to positively impact the stock price [2]. - The consensus earnings estimate for the current quarter is projected at $0.08 per share, reflecting a year-over-year increase of +14.29% [7]. - For the full year, the earnings estimate is expected to be $0.31 per share, representing a +10.71% change from the previous year [8]. Zacks Rank and Performance - TFS Financial has achieved a Zacks Rank of 2 (Buy), indicating favorable estimate revisions that suggest strong future performance [9]. - Historically, stocks with a Zacks Rank of 1 (Strong Buy) and 2 (Buy) have significantly outperformed the S&P 500 [9]. Recent Stock Performance - TFS Financial shares have increased by 15.2% over the past four weeks, indicating investor confidence in the company's earnings growth prospects [10].

分组1 - TFS Financial (TFSL) reported quarterly earnings of $0.07 per share, matching the Zacks Consensus Estimate, and the same as the previous year [1] - The company posted revenues of $79.12 million for the quarter ended March 2025, exceeding the Zacks Consensus Estimate by 4.65%, compared to $77.1 million in the same quarter last year [2] - TFS Financial shares have increased approximately 4.3% since the beginning of the year, while the S&P 500 has declined by 5.5% [3] 分组2 - The current consensus EPS estimate for the upcoming quarter is $0.07 on revenues of $77.4 million, and for the current fiscal year, it is $0.29 on revenues of $305.8 million [7] - The Zacks Industry Rank for Financial - Savings and Loan is in the top 23% of over 250 Zacks industries, indicating a favorable outlook for the industry [8]

Financial Performance - The company reported net income of $21.0 million for Q2 2025, a decrease from $22.4 million in Q1 2025, primarily due to increased provision for credit losses and non-interest expenses [2]. - Net income for the six months ended March 31, 2025, was $43,447,000, representing an increase of 4.9% compared to $41,420,000 in the same period of 2024 [30]. - The net income for the first quarter of 2025 was $21.02 million, a decrease from $22.43 million in the previous quarter, representing a decline of 6.3% [29]. - The earnings per share for the first quarter of 2025 were $0.07, consistent with the previous quarter [29]. - Basic and diluted earnings per share remained stable at $0.15 for both the six months ended March 31, 2025, and 2024 [30]. Income and Expenses - Total non-interest expense increased by $3.2 million, or 6.7%, to $51.1 million for Q2 2025, with notable increases in salaries, marketing services, and office expenses [5]. - Total non-interest income increased by $1.6 million, or 13.3%, to $13.6 million for the six months ended March 31, 2025, primarily due to a rise in net gain on the sale of loans [14]. - Non-interest income for the first quarter of 2025 was $7.07 million, an increase from $6.50 million in the previous quarter, showing an 8.7% growth [29]. - Total non-interest expense decreased to $99,029,000 for the six months ended March 31, 2025, down 3.0% from $102,475,000 in 2024 [30]. Assets and Liabilities - Total assets increased by $54.1 million to $17.11 billion at March 31, 2025, mainly due to increases in investment securities and loans held for investment [6]. - The company's total liabilities stood at $15.22 billion as of March 31, 2025, up from $15.14 billion at the end of 2024, reflecting a 0.5% increase [28]. - Total deposits increased to $10.40 billion as of March 31, 2025, up from $10.21 billion at the end of 2024, indicating a growth of 1.8% [28]. - Borrowed funds decreased by $69.0 million to $4.59 billion at March 31, 2025, as maturing borrowings were replaced with retail deposits [9]. Credit Losses - The provision for credit losses was $1.5 million for Q2 2025, compared to a $1.5 million release in Q1 2025, with total allowance for credit losses rising to $99.9 million, or 0.65% of total loans [4]. - The provision for credit losses was $1.50 million for the first quarter of 2025, compared to a release of $1.50 million in the previous quarter [29]. - The allowance for credit losses on loans remained stable at $70.55 million as of March 31, 2025, compared to $70.56 million at the end of 2024 [28]. Capital Ratios - The Tier 1 leverage ratio improved to 10.92% at March 31, 2025, exceeding the threshold for being considered well-capitalized [22]. - Return on average assets for the three months ended March 31, 2025, was 0.49%, slightly down from 0.53% in the previous quarter [31]. - Return on average equity for the three months ended March 31, 2025, was 4.35%, compared to 4.68% in the previous quarter [31]. - Average equity to average assets ratio was 11.30% for the six months ended March 31, 2025 [33]. Interest Income and Margin - Net interest income increased by $3.7 million, or 5.4%, to $72.0 million for Q2 2025, driven by a decrease in the weighted average cost of interest-bearing liabilities [3]. - The net interest income for the three months ended March 31, 2025, was $72.05 million, compared to $68.33 million in the previous quarter, reflecting a 3.5% increase [29]. - Total interest and dividend income for the six months ended March 31, 2025, was $372,720,000, an increase of 3.0% from $360,652,000 in the same period of 2024 [30]. - Net interest margin remained stable at 1.70% for both periods ended March 31, 2025, and March 31, 2024 [33].

Core Viewpoint - TFS Financial Corporation is a community bank with a presence in Ohio and Florida, serving additional states through online operations, founded in 1938 [1] Company Overview - TFS Financial Corporation operates as a community bank with physical locations in Ohio and Florida [1] - The bank also provides services to twenty-seven other states and the District of Columbia through its online platform [1] Investment Perspective - The company is characterized by small capitalization and presents high optionality to the upside compared to relative downside risk [1]

Capital Ratios and Financial Health - The company's Common Equity Tier 1 Capital ratio is 18.32%, exceeding regulatory requirements for being classified as "Well Capitalized" [135] - The company’s Tier 1 (leverage) capital totaled $1.85 billion, representing 10.89% of net average assets as of December 31, 2024 [144] - The Tier 1 (leverage) capital ratio was 9.96% as of December 31, 2024, indicating a well-capitalized status [163] - As of December 31, 2024, the Company reported total capital to risk-weighted assets of $1,940,628, representing a ratio of 19.15% [259] - The Company maintained tier 1 (leverage) capital to net average assets at $1,854,832, with a ratio of 10.89% [259] - The Company’s tier 1 capital to risk-weighted assets was reported at $1,854,832, with a ratio of 18.32% [259] - The Company’s common equity tier 1 capital to risk-weighted assets was also reported at $1,854,832, with a ratio of 18.31% [259] Loan Originations and Portfolio Composition - The total first mortgage loan originations for the three months ended December 31, 2024, amounted to $176.49 million, a decrease from $272.95 million in the same period of 2023 [147] - The balance of first mortgage loans held for investment as of December 31, 2024, was $11.21 billion, compared to $11.43 billion as of September 30, 2024 [148] - Total loans receivable amounted to $15.36 billion, with a weighted average yield of 4.52% as of December 31, 2024 [150] - As of December 31, 2024, 90% of the company's assets consisted of residential real estate loans and home equity loans and lines of credit [160] - The total residential core loans reached $11,170,777,000, accounting for 72.8% of the loan portfolio, down from 74.2% in the prior quarter [187] - Home equity lines of credit totaled $3.51 billion, with an average yield of 6.60% [152] - Home equity loans totaled $608,454,000, which is 4.0% of total loans, up from 3.6% in the previous quarter [187] - The company has extended its lending activities to 25 other states and the District of Columbia to reduce concentration risk in Ohio and Florida [162] Interest Rate Management and Risk Exposure - The company’s marketing strategy includes promoting adjustable-rate loans and shorter-term fixed-rate loans to manage interest rate risk [145] - The yield on ARM loans scheduled for interest rate reset in 2025 is 3.94% with a total current balance of $730.49 million [148] - The Company’s interest rate risk management strategy includes monitoring and managing its net interest income sensitivity to changes in market interest rates [261] - In the event of a 200 basis point increase in interest rates, the Company would experience a 26.35% decrease in estimated economic value of equity (EVE) [271] - A 100 basis point decrease in interest rates would lead to an 8.89% increase in the Company's EVE [274] - The overall interest rate risk exposure is indicated by the EVE measurements, which are not precise forecasts of actual results [276] Credit Quality and Allowance for Losses - The allowance for credit losses on loans at the end of the period was $70.6 million, with a total allowance for credit losses of $97.8 million [180] - The allowance for credit losses on loans was $70,559,000, representing 100% of total loans, consistent with the previous quarter [187] - The percentage of loans seriously delinquent (90 days or more) was 0.10% of total net loans as of December 31, 2024, reflecting a slight increase from 0.09% at September 30, 2024 [204] - Serious delinquencies in the home equity lines of credit portfolio remained stable at 0.03% for both periods [206] - The total charge-offs for the three months ended December 31, 2024, were $317, down from $510 in the same period of 2023 [176] - The company recorded a $1.5 million net release of allowance for credit losses for the period, consisting of a $0.9 million release of provision on loans [180] Income and Expense Trends - Net income increased by $1.7 million, or 8%, to $22.4 million for the quarter ended December 31, 2024 [227] - Interest and dividend income increased by $9.6 million, or 5%, to $186.8 million during the current quarter [230] - Interest expense increased by $10.3 million, or 10%, to $118.4 million during the current quarter, compared to $108.1 million for the quarter ended December 31, 2023 [232] - Non-interest income increased by $0.2 million, or 3%, to $6.5 million during the current quarter, primarily due to an increase in net gain on the sale of loans [239] - Non-interest expense decreased by $2.4 million, or 5%, to $47.9 million during the current quarter, compared to $50.3 million for the quarter ended December 31, 2023 [240] Asset and Deposit Management - Total assets decreased by $33.2 million, or less than 1%, to $17.06 billion at December 31, 2024, from $17.09 billion at September 30, 2024 [213] - Total deposits increased by $12.2 million, or less than 1%, to $10.21 billion at December 31, 2024 [220] - Average deposits per full-time employee were $11.0 million, with average deposits held at branch offices amounting to $246.2 million as of December 31, 2024 [168] - The company retains additional borrowing capacity totaling $3.12 billion under arrangements with the FHLB of Cincinnati and the FRB Cleveland [137] - The company had $158.8 million in cash and a demand loan from the Association available for its operations as of December 31, 2024 [259]