WaFd, Inc. Reports Decrease in Net Income to $47.3 Million for Quarter Ending December 31, 2024

WaFd, Inc. reported its financial results for the quarter ending December 31, 2024, revealing a net income of $47.3 million, a decrease from $58.5 million in the same period last year. The company's net interest income was $155.4 million, slightly down from $158.6 million year-over-year. The decline in profitability is attributed to a decrease in net interest margin, which fell to 2.39% from 2.91% a year earlier, primarily due to a greater increase in interest-bearing liabilities compared to interest-earning assets.

Total assets decreased to $27.7 billion from $28.1 billion at the end of the previous quarter, with cash and cash equivalents dropping significantly by 36.7% to $1.5 billion. Loans receivable increased by 0.7% to $21.1 billion, driven by $930.8 million in originations, while the allowance for credit losses remained stable at $204.5 million. The company did not record any provision for credit losses during the quarter, consistent with the previous year, reflecting stable credit performance.

In terms of strategic developments, WaFd completed its merger with Luther Burbank Corporation on March 1, 2024, which has significantly impacted its financial results. The merger has led to an increase in the average balance of interest-earning assets by 23.75% compared to the previous year. The company also announced its exit from the single-family mortgage lending market, a decision aimed at reducing credit risk and improving profitability, which involved a restructuring charge of $5.4 million.

Operationally, WaFd's customer accounts increased by 0.3% to $21.4 billion, with transaction accounts rising slightly. The company reported a total of 210 bank branches across several states, including Washington, Oregon, and California. The non-performing assets increased to $79.1 million, or 0.29% of total assets, reflecting a slight uptick in non-accrual loans. The company continues to focus on commercial lending, which accounted for 68% of total loan originations during the quarter.

Looking ahead, WaFd's management expressed confidence in its ability to navigate the current economic landscape, emphasizing its strong capital position with shareholders' equity at $3.0 billion, or 10.91% of total assets. The company remains committed to enhancing its operational efficiency and managing interest rate risk effectively, particularly in light of the ongoing economic uncertainties.