Capitol Federal Financial, Inc. reported a significant increase in financial performance for the six months ending March 31, 2025, with net income reaching $30.8 million, or $0.24 per share, compared to $16.3 million, or $0.12 per share, for the same period in the previous year. This growth was primarily driven by higher net interest income, which increased due to a shift in the loan portfolio from lower-yielding one- to four-family loans to higher-yielding commercial loans. The net interest margin improved from 1.76% to 1.89%, reflecting the company's strategic focus on enhancing profitability through its lending practices.
Total assets rose to $9.72 billion, an increase of $190.6 million from September 30, 2024, largely attributed to higher cash and cash equivalents, as well as an increase in available-for-sale (AFS) securities. However, the loan portfolio saw a decrease, with loans receivable net declining to $7.88 billion, primarily due to a $186.9 million reduction in one- to four-family loans, which was partially offset by a $159.3 million increase in commercial loans. Total deposits also increased by $242.6 million to $6.37 billion, driven by the Bank's high-yield savings account offerings.
Operationally, Capitol Federal Financial has been transitioning towards a more commercial banking-focused model. The company has implemented new technologies and strategies to enhance its commercial banking services, including the introduction of commercial loan pricing software. The efficiency ratio improved to 59.23% from 74.29% in the previous year, indicating better cost management relative to income generation. The Bank's capital ratios remain strong, with stockholders' equity totaling $1.04 billion, exceeding regulatory requirements for well-capitalized institutions.
The company also reported a low level of loan delinquency, with loans 30 to 89 days delinquent at 0.18% of total loans and loans 90 or more days delinquent at 0.12%. The allowance for credit losses (ACL) stood at $23.97 million, reflecting a slight decrease from the previous period, attributed to an increase in prepayment speeds on commercial real estate loans. Looking ahead, Capitol Federal Financial anticipates continued improvement in net interest margins and overall financial performance, contingent on favorable market conditions and effective management of its loan portfolio.
About Capitol Federal Financial, Inc.
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