On July 17, 2024, WaFd Inc (WAFD, Financial) released its 8-K filing for the quarter ended June 30, 2024. WaFd Inc, engaged in providing lending, depository, insurance, and other banking services across several states including Washington, Oregon, Arizona, Texas, Utah, New Mexico, Nevada, and Idaho, reported robust financial results that exceeded analyst estimates.
Performance Overview
WaFd Inc reported quarterly earnings of $64.56 million, representing a significant increase of 306% from the previous quarter's net earnings of $15.89 million. This performance also marks a 5% increase from the $61.78 million reported in the same quarter last year. The earnings per diluted share for the quarter stood at $0.75, surpassing the analyst estimate of $0.57. Revenue for the quarter was $177 million, exceeding the estimated $171.99 million.
Key Financial Achievements
WaFd Inc's financial achievements this quarter are noteworthy, particularly in the context of its recent acquisition of Luther Burbank Corporation (LBC). The acquisition has significantly bolstered the company's asset base, with total assets increasing to $28.6 billion as of June 30, 2024, up from $22.5 billion at the end of September 2023. Net loans held for investment rose by $3.4 billion, reflecting a 19.4% increase.
Income Statement Highlights
| Metric | Q2 2024 | Q1 2024 | Q2 2023 |
|---|---|---|---|
| Net Income | $64.56 million | $15.89 million | $61.78 million |
| Earnings Per Share (Diluted) | $0.75 | $0.17 | $0.89 |
| Revenue | $177 million | $158.6 million | $168.7 million |
Balance Sheet and Cash Flow
WaFd Inc's balance sheet reflects the impact of the LBC acquisition, with cash and cash equivalents increasing by $1.5 billion, or 154.2%, since September 2023. Customer deposits grew by 31.8% to $21.2 billion, driven by the addition of LBC's deposit portfolio. The company's borrowings also saw a net increase of $200 million, totaling $3.9 billion as of June 30, 2024.
Operational Efficiency and Credit Quality
The company's efficiency ratio for the quarter was 55.7%, an improvement from 58.5% in the previous quarter. WaFd Inc's credit quality remains strong, with loan delinquencies decreasing from 0.36% to 0.22% and non-performing loans remaining stable. The allowance for credit losses totaled $225 million, representing 1.00% of gross loans outstanding.
Commentary from Management
"We are very pleased to report solid results for the first full quarter following the largest acquisition in our history. In addition to successfully integrating Luther Burbank into our operations, we also executed what we believe to be the largest Commercial Real Estate loan sale ever in US banking, proving the quality and liquidity of our loans," said President and CEO Brent Beardall.
Conclusion
WaFd Inc's strong quarterly performance, driven by strategic acquisitions and effective integration, positions the company well for future growth. The significant increase in net income and earnings per share, along with robust asset growth and improved operational efficiency, underscore the company's resilience and strategic acumen in navigating the current economic landscape.
Explore the complete 8-K earnings release (here) from WaFd Inc for further details.
