New Waterstone(WSBF) - 2024 Q2 - Quarterly Report

Financial Performance - Net income for the community banking segment decreased to $4.3 million for Q2 2024, down from $5.2 million in Q2 2023, representing a decline of 17.3%[147] - Net interest income for the community banking segment fell by $2.0 million to $11.2 million in Q2 2024, compared to $13.2 million in Q2 2023, a decrease of 15.2%[147] - The mortgage banking segment reported a net income of $1.3 million for Q2 2024, a turnaround from a net loss of $1.2 million in Q2 2023[150] - Net income for the community banking segment totaled $7.0 million for the six months ended June 30, 2024, down from $10.0 million for the same period in 2023[172] - Net interest income decreased by $4.7 million, or 17.6%, to $21.8 million for the six months ended June 30, 2024, compared to $26.5 million for the same period in 2023[186] Mortgage Banking - Mortgage loan originations increased by $10.8 million, or 1.7%, to $634.1 million in Q2 2024 from $623.3 million in Q2 2023[150] - Total mortgage banking noninterest income rose by $2.0 million, or 8.9%, to $25.1 million in Q2 2024 compared to $23.0 million in Q2 2023[150] - The company originated $1.12 billion in mortgage loans held for sale during the six months ended June 30, 2024, representing an increase of $53.2 million, or 5.0%, from the prior year[175] - Total mortgage banking noninterest income increased by $4.4 million, or 10.8%, to $45.4 million for the six months ended June 30, 2024, compared to $41.0 million for the same period in 2023[175] - Mortgage banking income rose by $2.92 million, or 13.3%, to $24.84 million for the three months ended June 30, 2024, compared to $21.91 million for the same period in 2023[166] - Mortgage banking income rose by $6.2 million, or 16.1%, to $44.9 million for the six months ended June 30, 2024, compared to $38.7 million for the same period in 2023[192] Interest Income and Expenses - Interest income on loans increased by $3.5 million, or 15.6%, to $25.6 million, driven by a 49 basis point increase in average yield and a $81.6 million, or 5.1%, increase in average loans held for investment[160] - Interest expense on time deposits rose by $3.5 million, or 71.1%, to $8.3 million, attributed to a 161 basis point increase in average cost of time deposits[160] - Interest expense on time deposits increased by $8.1 million, or 102.0%, to $16.0 million, primarily due to a 192 basis point increase in average cost[187] - Interest expense on borrowings increased by $2.0 million, or 35.7%, to $7.6 million due to an 84 basis point increase in the cost of borrowings[160] Credit Losses and Provisions - The community banking segment experienced a negative provision for credit losses of $279,000 in Q2 2024, compared to a provision of $158,000 in Q2 2023[148] - There was a negative provision for credit losses of $225,000 for the three months ended June 30, 2024, compared to a $186,000 provision for credit losses for the same period in 2023[162] - The provision for credit losses was a negative $158,000 for the six months ended June 30, 2024, compared to a $646,000 provision for credit losses for the same period in 2023[189] - The allowance for credit losses decreased to $18.4 million at June 30, 2024, with a negative provision of $146,000 for the six months ended June 30, 2024[203] Noninterest Income and Expenses - Total noninterest income increased by $3.0 million, or 12.6%, to $26.5 million during the three months ended June 30, 2024, compared to $23.5 million in the same period of 2023[164] - Total noninterest income increased by $5.7 million, or 13.5%, to $47.7 million during the six months ended June 30, 2024, compared to $42.1 million for the same period in 2023[191] - Total noninterest expenses decreased by $663,000, or 2.1%, to $30.26 million for the three months ended June 30, 2024, compared to $30.92 million for the same period in 2023[168] - Total noninterest expenses decreased by $2.2 million, or 3.7%, to $57.8 million for the six months ended June 30, 2024, compared to $60.0 million for the same period in 2023[195] Assets and Liabilities - Total assets increased by $76.2 million, or 3.4%, to $2.29 billion at June 30, 2024, from $2.21 billion at December 31, 2023[199] - Total liabilities increased to $1,877,402 thousand as of June 30, 2024, compared to $1,737,124 thousand as of June 30, 2023[182] - The average balance of borrowings increased by $115.8 million to $612.7 million during the six months ended June 30, 2024[187] - Total deposits increased by $33.3 million to $1.22 billion at June 30, 2024, driven by a $36.3 million increase in time deposits[204] Shareholders' Equity - Shareholders' equity decreased by $9.1 million to $334.9 million at June 30, 2024, primarily due to dividends declared and stock repurchases[206] - The company has a stock repurchase program authorized for 2,000,000 shares, with approximately 1.9 million shares remaining as of June 30, 2024[230] Regulatory and Compliance - The company is considered "well capitalized" under regulatory guidelines as of June 30, 2024[231] - There have been no changes in the Company's internal control over financial reporting during the fiscal quarter[239] - The Company has not identified any material effects on its internal control over financial reporting[239] - Legal proceedings and contingent liabilities are detailed in Part I, Item 1, Note 8[240] Market and Economic Conditions - A 100 basis point increase in interest rates is projected to decrease net interest income by 7.08% over the next 12 months, while a decrease of 100 basis points is expected to increase net interest income by 7.86%[235]