Flagstar Bank, National Association, reported a net loss of $177 million for the fiscal year ending December 31, 2025, a significant improvement compared to a net loss of $1.1 billion in 2024. The loss attributable to common stockholders was $210 million, or $0.50 per diluted share, compared to a loss of $1.2 billion, or $3.49 per diluted share, in the previous year. The bank's total assets decreased to $87.5 billion from $100.2 billion in 2024, primarily due to a strategic reduction in multi-family and commercial real estate (CRE) loans, as well as the sale of its mortgage operations.
Flagstar's net interest income for 2025 was $1.721 billion, down from $2.152 billion in 2024, reflecting a decrease in average total loans and leases. The bank's net interest margin (NIM) also fell to 1.89% from 1.95% in the prior year. The provision for credit losses decreased to $184 million from $1.092 billion, attributed to a stabilization in credit trends and a reduction in the allowance for credit losses (ACL) to $1.030 billion from $1.201 billion. The bank's total loans and leases held for investment decreased to $60.7 billion, with multi-family loans comprising 47.7% of the portfolio.
In terms of operational developments, Flagstar Bank underwent a significant internal corporate reorganization in October 2025, merging with its former holding company, Flagstar Financial, Inc. This move aimed to streamline operations and enhance financial performance. The bank also reported a reduction in its workforce, with a total employee count of 5,631 as of December 31, 2025. The bank operates approximately 340 locations across nine states, with a strong presence in the New York/New Jersey metropolitan area and growing markets in Florida and California.
Looking ahead, Flagstar Bank's management expressed optimism about the bank's strategic transformation plan, which focuses on diversifying its loan portfolio and enhancing operational efficiency. The bank aims to build a customer-centric culture and improve risk management practices. However, challenges remain, particularly in managing interest rate risk and the potential impact of economic conditions on loan performance. The bank's capital ratios continue to exceed regulatory requirements, positioning it as "well capitalized" under federal standards.
About FLAGSTAR FINANCIAL, INC.
Flagstar Financial, Inc. is a bank holding company operating Flagstar Bank, N.A., a regional bank with over 400 locations across ten states. It offers retail banking, private banking, and commercial lending services, focusing on real estate, middle-market, and high-net-worth clients. The company emphasizes deposit gathering, fee-based services, and prudent risk management within a heavily regulated banking environment.
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