Waterstone Financial, Inc. reported a net income of $26.4 million for the fiscal year ending December 31, 2025, a significant increase from $18.7 million in the previous year. This translates to earnings per share of $1.48, up from $1.01 in 2024. The company's total assets grew by 2.3% to $2.26 billion, driven by increases in cash and cash equivalents, loans held for sale, and securities available for sale. Notably, the allowance for credit losses decreased to $17.5 million from $18.2 million, reflecting improved credit quality and a negative provision for credit losses of $1.4 million.
In terms of operational performance, Waterstone Financial's community banking segment saw net income rise to $24.8 million, bolstered by an increase in net interest income, which rose by $8.2 million to $56.2 million. This growth was attributed to higher interest income from loans and mortgage-related securities, despite an increase in interest expenses on deposits. The mortgage banking segment, however, reported stable net income of $1.4 million, with a decrease in loan origination volume to $2.05 billion, down 4.6% from the previous year.
The company also experienced a 5.7% increase in total deposits, reaching $1.44 billion, primarily due to growth in money market and savings accounts. The composition of deposits shifted, with certificates of deposit making up 64.9% of total deposits, which has led to a higher cost of funds. Waterstone Financial's employee headcount decreased to 593 from 600, reflecting a strategic decision to streamline operations amid changing market conditions.
Looking ahead, Waterstone Financial anticipates continued challenges in the mortgage banking sector due to fluctuating interest rates and competitive pressures. The company is focused on enhancing its community banking services and expanding its market presence while managing risks associated with credit quality and operational efficiency. The management remains optimistic about leveraging its strong capital position, with a total capital ratio of 20.49%, to navigate the evolving financial landscape.
About Waterstone Financial, Inc.
Waterstone Financial, Inc. is a community-focused bank providing retail banking, mortgage lending, and investment services. Its primary activities include originating residential and commercial real estate loans, offering deposit products, and managing a diverse securities portfolio. Serving primarily Wisconsin and select states through its bank and mortgage subsidiary, it emphasizes relationship banking, asset quality, and prudent risk management within a competitive financial landscape.
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