Capitol Federal Financial(US:CFFN)2025-10-29 13:21Financial Performance - Total assets reached $9.78 billion, stockholders' equity at $1.05 billion, and net income of $68.0 million for fiscal year 2025, reflecting growth from the previous year[2]. - Net income for the fourth quarter was $18.8 million, up from $18.4 million in the prior quarter, with basic and diluted earnings per share of $0.14[6][15]. - Net income for the year ended September 30, 2025, was $68.0 million, or $0.52 per share, compared to $38.0 million, or $0.29 per share, for the prior year, reflecting a significant increase in profitability[28]. - Net income for 2025 was $68,025,000, a 79.0% increase from $38,010,000 in 2024[43]. - Net income for the three months ended September 30, 2025, was $18,813 thousand, slightly higher than $18,382 thousand in the previous quarter, showing a growth of 2.3%[69]. Asset and Loan Growth - Total assets grew to $9,778,701,000 as of September 30, 2025, a 3.5% increase from $9,692,739,000 on June 30, 2025[47]. - The commercial loan portfolio grew by $607.0 million, or 40.2%, during fiscal year 2025, with commercial loans now comprising 26% of the overall loan portfolio[6][9]. - Total loans receivable increased to $8,126,806 thousand for the three months ended September 30, 2025, from $7,996,493 thousand in the previous quarter, reflecting a growth of 1.6%[70]. - Total commercial loans increased to $1,780,034 thousand in 2025, up from $1,378,421 thousand in 2024, with a yield increase from 5.57% to 5.77%[71]. - The total amount of commercial loans for the year ended September 30, 2025, was $901,897, with a weighted average rate of 6.95%[82]. Income and Expense Management - Cash dividends declared for fiscal year 2025 totaled $44.3 million, with a cash dividend of $0.085 per share announced for payment on November 21, 2025[12][14]. - Salaries and employee benefits rose by 4.3% to $15,936,000, contributing to a total non-interest expense increase of 4.9% to $31,018,000[24]. - Total non-interest income increased to $20,725,000 in 2025 from $5,244,000 in 2024, representing a 295.2% increase[38]. - Total non-interest expense for the year ended September 30, 2025, was $117,270 thousand, compared to $111,943 thousand for the previous year, representing an increase of 4.7%[69]. Efficiency and Ratios - The efficiency ratio improved to 56.84% in the fourth quarter, down from 58.26% in the prior quarter, indicating enhanced operational efficiency[6]. - The efficiency ratio improved to 58.33% in 2025 from 66.91% in 2024, reflecting higher net interest income[41]. - Return on average assets improved to 0.71% in 2025 from 0.40% in 2024, while return on average equity increased from 3.69 to 6.54[72]. Credit Quality and Losses - The provision for credit losses decreased to $745,000 from $1.3 million in the prior year, reflecting improved credit quality[36]. - Non-performing assets totaled $48,260,000, accounting for 0.49% of total assets as of September 30, 2025[101]. - The allowance for credit losses is estimated using a discounted cash flow model, with qualitative factors applied to account for large dollar commercial real estate loan concentrations[108]. - The total net charge-offs for the current fiscal year amounted to $198 thousand, with the majority related to a single-family bulk purchased loan[115]. Deposits and Funding - Deposits increased by $461,500,000 from September 30, 2024, primarily due to the high yield savings account offering[51]. - The deposit portfolio totaled $6.59 billion as of September 30, 2025, with a weighted average rate of 2.26%[124]. - Total retail deposits amounted to $5,961,370 thousand, with an average rate of 2.25%, representing 90.5% of total deposits[127]. - The total amount of certificates of deposit was $3,012,680 thousand, with an average rate of 3.74%, representing 45.7% of total deposits[126]. Securities and Investments - The company sold $1.30 billion of securities, representing 94% of its securities portfolio, and recognized an impairment loss of $192.6 million[30]. - The securities portfolio at amortized cost was $867.2 million as of September 30, 2025, with fixed-rate securities comprising 91% of the portfolio[120]. - The weighted average yield on the securities portfolio was 5.45% as of September 30, 2025, with a weighted average life of 4.8 years[120]. Future Outlook and Strategy - A new suite of private banking products is set to launch in fiscal year 2026, targeting high-net-worth individuals with personal relationships of $5 million or more[12][13]. - The company is committed to ongoing digital transformation, with enhancements to digital banking expected to be implemented in the second quarter of fiscal year 2026[11]. - Management anticipates a 9% increase in salary and employee benefit expenses for fiscal year 2026 due to hiring and merit increases[45]. - The Bank expects to fund approximately $76 million of undisbursed amounts on existing commercial real estate loans during the December 31, 2025 quarter[47].