TFS Financial (TFSL) - 2025 Q1 - Quarterly Results

Financial Performance - The company reported net income of $22.4 million for Q1 FY2025, an increase of 23.08% from $18.2 million in Q4 FY2024[3] - Net income for the three months ended December 31, 2024, was $22,426 thousand, an increase of 23.8% compared to $18,215 thousand for the previous quarter[30] - The company reported a basic earnings per share of $0.08 for the quarter, compared to $0.06 in the previous quarter, marking a 33.3% increase[30] Income and Expenses - Net interest income decreased by $0.4 million, or 0.58%, to $68.3 million compared to the previous quarter, primarily due to a decline in short-term interest rates[4] - Total interest and dividend income for the quarter was $186,768 thousand, a decrease of 0.4% from $188,516 thousand in the prior quarter[30] - Net interest income after provision for credit losses was $69,828 thousand, up from $67,715 thousand in the previous quarter, reflecting a growth of 3.1%[30] - Non-interest income totaled $6,503 thousand, showing a slight increase from $6,420 thousand in the previous quarter[30] - Total non-interest expense decreased by $3.2 million, or 6.26%, to $47.9 million, driven by reductions in marketing costs and other expenses[7] Asset and Liability Management - Total assets decreased by $33.2 million, or less than 1%, to $17.06 billion, primarily due to declines in investment securities[13] - Total liabilities decreased to $15,143,309 thousand from $15,228,161 thousand, a reduction of 0.56%[29] - Total liabilities stood at $15,099,879 thousand, with total shareholders' equity at $1,915,478 thousand[31] Credit Quality and Risk Management - Total loan delinquencies increased to $36.3 million, or 0.24% of total loans receivable, up from $31.9 million, or 0.21% in the prior quarter[6] - The total allowance for credit losses was $97.8 million, or 0.64% of total loans receivable, unchanged from the previous quarter[5] - The allowance for credit losses on loans increased slightly to $(70,559) thousand from $(70,002) thousand, indicating a cautious approach to credit risk management[29] - The company experienced a provision release for credit losses of $(1,500) thousand, compared to a provision of $1,000 thousand in the previous quarter, indicating improved credit quality[30] Capital and Dividends - The company's Tier 1 capital ratio was reported at 10.89%, indicating strong capital adequacy[23] - The company declared a quarterly dividend of $0.2825 per share during the quarter[22] Deposits and Loans - Deposits increased by $12.2 million, or less than 1%, to $10.21 billion, with a significant contribution from a special CD offering that attracted $350 million in deposits[18] - Loans held for investment increased by $20.9 million, or less than 1%, to $15.34 billion, despite a decrease in the portfolio of loans held for sale[15] - Deposits increased to $10,207,257 thousand from $10,195,079 thousand, reflecting a growth of 0.12%[29] Interest Rates and Margins - The yield on loans was 4.49% for the three months ended December 31, 2024, compared to 4.26% for the same period in 2023[31] - The net interest margin for the three months ended December 31, 2024, was 1.66%, down from 1.68% in December 2023[31] - The interest rate spread decreased to 1.34% for the three months ended December 31, 2024, from 1.39% in December 2023[31] Asset Composition - Total assets decreased slightly to $17,057,586 thousand as of December 31, 2024, from $17,090,785 thousand on September 30, 2024, representing a decline of 0.19%[29] - Total interest-earning assets increased to $16,490,723 thousand for the three months ended December 31, 2024, with a net interest income of $68,328 thousand[31] - The average balance of loans was $15,326,120 thousand, showing a slight increase from $15,232,349 thousand in December 2023[31] - The average balance of certificates of deposit increased to $8,058,740 thousand, with an interest expense of $74,499 thousand, yielding 3.70%[31] - Average interest-earning assets to average interest-bearing liabilities ratio was 111.21% for the three months ended December 31, 2024[31]