Customers Bancorp(CUBI) - 2025 Q4 - Annual Results

Financial Performance - Q4 2025 net income available to common shareholders was $70.1 million, or $1.98 per diluted share; core earnings were $72.9 million, or $2.06 per diluted share[3] - 2025 net income available to common shareholders was $209.2 million, or $6.26 per diluted share; core earnings were $254.5 million, or $7.61 per diluted share[3] - Net income available to common shareholders for Q4 2025 was $70,088,000, a decrease of 5.4% from Q3 2025's $73,726,000[42] - Diluted earnings per share for Q4 2025 was $1.98, down from $2.20 in Q3 2025, representing a 10% decline[42] - Core earnings for Q4 2025 were $72,851,000, slightly down from $73,473,000 in Q3 2025[42] - Net income for the twelve months ended December 31, 2025, was $224,088,000, an increase from $181,469,000 in the previous year, marking a growth of 23.4%[45] - The company reported a total of $254,473 thousand in core earnings for the year 2025, compared to $183,105 thousand in 2024[62] Asset and Loan Growth - Total deposits increased by $373.7 million, or 1.8%, and total loans increased by $479.4 million, or 2.9%, in Q4 2025 from Q3 2025[3] - Total deposits increased by $1.9 billion, or 10.3%, and total loans increased by $2.1 billion, or 14.5%, from December 31, 2024 to December 31, 2025[3] - Loans and leases held for investment were $16.8 billion at December 31, 2025, up $2.3 billion, or 16.0%, year-over-year[12] - Total loans and leases reached $16,782,516,000 in Q4 2025, a 2.9% increase from $16,303,147,000 in Q3 2025[42] - Total loans and leases for the twelve months ended December 31, 2025, were $1,024,760,000, an increase from $901,457,000 in the previous year, reflecting a growth of 13.7%[45] - Specialized lending loans and leases increased to $7,090,259 thousand in December 2025, up from $5,842,420 thousand in December 2024, a growth of 21.36%[53] Deposits and Liabilities - Total deposits increased to $20,778,704,000 in Q4 2025, up from $20,405,023,000 in Q3 2025, showing growth in customer deposits[42] - Total liabilities grew to $22,780,351 thousand, an increase of 2.9% from $22,134,104 thousand in the previous quarter[46] - Non-interest-bearing deposits totaled $6,303,748 thousand in December 2025, compared to $5,608,288 thousand in December 2024, an increase of 12.38%[54] Income and Expense Analysis - Net interest income totaled a record $750.5 million in 2025, an increase of $96.1 million, or 14.7%, from 2024[3] - Non-interest income totaled $32.5 million for Q4 2025, an increase of $2.3 million compared to Q3 2025[24] - Non-interest expenses totaled $117.3 million in Q4 2025, an increase of $12.1 million compared to Q3 2025[26] - Total non-interest expense for Q4 2025 was $117,309,000, compared to $110,375,000 in Q4 2024, representing an increase of 6.5%[45] - GAAP non-interest expense increased to $117,309 thousand in Q4 2025 from $105,217 thousand in Q3 2025, with a total of $431,923 thousand for 2025 compared to $417,014 thousand in 2024[65] Credit Quality and Provisions - Non-performing loans at December 31, 2025 were 0.26% of total loans and leases, compared to 0.17% at September 30, 2025[20] - Provision for credit losses for Q4 2025 was $22,337,000, compared to $21,194,000 in Q4 2024, indicating a slight increase in credit loss provisions[45] - The total allowance for credit losses on loans and leases was $155,656 thousand, slightly up from $151,809 thousand, indicating a 2.5% increase[46] - The net charge-offs for Q4 2025 were $13,749, compared to $15,371 in Q3 2025, indicating a decrease in charge-offs[57] Capital and Efficiency Ratios - CET 1 capital ratio was 13.0% at December 31, 2025, compared to 12.1% at December 31, 2024[3] - Common equity to total assets ratio improved to 8.5% in Q4 2025, up from 8.4% in Q3 2025[43] - The efficiency ratio for Q4 2025 was 49.52%, an increase from 45.39% in Q3 2025, reflecting higher operational costs[42] - Tangible common equity to tangible assets ratio increased to 8.5% in Q4 2025 from 8.4% in Q3 2025, reflecting a steady improvement in capital efficiency[66] Future Outlook - For 2026, Customers Bancorp is targeting loan growth of 8% to 12% and deposit growth of 8% to 12%, with net interest income projected to reach $800 to $830 million[32] - Non-interest expenses are expected to be between $440 to $460 million as the company continues to invest in people and technology[32] - The company aims to maintain a Common Equity Tier 1 (CET1) ratio of 11.5% to 12.5% and anticipates a tax rate of 23% to 25%[32] Recognition and Client Focus - Customers Bancorp has been recognized as a Top 10 Performing Bank by American Banker for five consecutive years (2021-2025), achieving the 1 spot in 2024 among midsize banks[39] - The company reported a Net Promoter Score of 81, significantly higher than the industry average of 41[39] - Customers Bancorp emphasizes a client-centric culture and a Single Point of Contact service model to differentiate itself from peers[30] - Customers Bancorp is focused on enhancing its payments capabilities and increasing the utilization of AI and automation technologies to improve client experiences and productivity[31]