WaFd, Inc. Reports Q3 2025 Financial Results with Decrease in Net Income

WaFd, Inc. reported its financial results for the third quarter of fiscal year 2025, revealing a net income of $61.95 million, a decrease from $64.56 million in the same quarter of the previous year. For the nine months ending June 30, 2025, the company achieved a net income of $165.47 million, compared to $138.90 million for the same period in 2024. The decrease in quarterly net income was attributed to a decline in net interest income, which fell to $167.99 million from $177.19 million year-over-year, primarily due to reduced loan volumes and lower interest-earning asset balances.

Total assets decreased to $26.73 billion as of June 30, 2025, down from $28.06 billion at the end of the previous fiscal year. This decline was largely driven by a reduction in loans receivable, which fell to $20.28 billion from $20.92 billion. The company reported a decrease in loans due to principal repayments outpacing new originations, with commercial loans accounting for 77% of total originations. The allowance for credit losses on loans was $198.77 million, a slight decrease from $203.75 million at the end of September 2024.

In terms of operational metrics, WaFd's customer accounts increased marginally by $12.6 million to $21.39 billion, while total borrowings decreased significantly to $1.94 billion from $3.27 billion. The company’s shareholders' equity rose to $3.01 billion, representing 11.28% of total assets, an increase from 10.69% at the end of the previous fiscal year. The company also repurchased 1.66 million shares of its common stock during the quarter at an average price of $29.08 per share.

Strategically, WaFd continues to focus on its commercial lending operations while managing its interest rate risk through various hedging strategies. The company has entered into interest rate swaps to mitigate risks associated with rising interest rates. Additionally, WaFd is navigating regulatory challenges, including a "Needs to Improve" rating under the Community Reinvestment Act, which may restrict its operational flexibility.

Looking ahead, WaFd's management remains cautious about the economic environment, particularly regarding interest rates and inflation, which could impact credit quality and loan performance. The company is committed to maintaining its capital adequacy and liquidity while adapting to changing market conditions.