• Waterstone Financial, Inc. Announces Results of Operations for the Quarter and Year Ended December 31, 2024

    ソース: Nasdaq GlobeNewswire / 28 1 2025 16:01:00   America/New_York

    WAUWATOSA, Wis., Jan. 28, 2025 (GLOBE NEWSWIRE) -- Waterstone Financial, Inc. (NASDAQ: WSBF), holding company for WaterStone Bank, reported net income of $5.2 million, or $0.28 per diluted share, for the quarter ended December 31, 2024, compared to net loss of $40,000, or less than $0.01 per diluted share, for the quarter ended December 31, 2023. Net income per diluted share was $1.01 for the year ended December 31, 2024, compared to net income per diluted share of $0.46 for the year ended December 31, 2023.

    “We are pleased with the company's performance compared to the prior year and looking to build off of the positives from 2024,” said William Bruss, Chief Executive Officer of Waterstone Financial, Inc. “We achieved loan growth, achieved core deposit growth (excluding brokered certificates of deposit), and continued to maintain strong asset quality metrics. The interest rate environment created challenges for both the Community Banking and Mortgage Banking segments even with the 100 bps cut in the Federal Funds rate during the second half of the year. The Mortgage Banking segment remained profitable due in large part to our continued focus on cost control as funding volumes are still facing headwinds from the higher fixed-rate mortgage rates. Waterstone Financial, Inc. remained active in share repurchases and continued to pay out dividends, as we are committed to shareholder returns.” 

    Highlights of the Quarter Ended December 31, 2024

    Waterstone Financial, Inc. (Consolidated)

    • Consolidated net income of Waterstone Financial, Inc. totaled $5.2 million for the quarter ended December 31, 2024, compared to a net loss of $40,000 for the quarter ended December 31, 2023.
    • Consolidated return on average assets was 0.94% for the quarter ended December 31, 2024, compared to (0.01)% for the quarter ended December 31, 2023.
    • Consolidated return on average equity was 6.05% for the quarter ended December 31, 2024, and (0.05)% for the quarter ended December 31, 2023.
    • Dividends declared during the quarter ended December 31, 2024, totaled $0.15 per common share.
    • During the quarter ended December 31, 2024, we repurchased approximately 194,000 shares at a cost (including the federal excise tax) of $2.8 million, or $14.43 per share.
    • Nonperforming assets as a percentage of total assets was 0.28% at December 31, 2024, 0.25% at September 30, 2024, and 0.23% at December 31, 2023.
    • Past due loans as a percentage of total loans was 0.95% at December 31, 2024, 0.63% at September 30, 2024, and 0.68% at December 31, 2023. 
    • Book value per share was $17.53 at December 31, 2024, and $16.94 at December 31, 2023. 

    Community Banking Segment

    • Pre-tax income totaled $6.7 million for the quarter ended December 31, 2024, which represents a $1.4 million, or 26.0%, increase compared to $5.3 million for the quarter ended December 31, 2023.
    • Net interest income totaled $12.9 million for the quarter ended December 31, 2024, which represents a $830,000, or 6.9%, increase compared to $12.1 million for the quarter ended December 31, 2023.
    • Average loans held for investment totaled $1.68 billion during the quarter ended December 31, 2024, which represents an increase of $21.5 million, or 1.3%, compared to $1.66 billion for the quarter ended December 31, 2023. The increase was primarily due to increases in the construction, commercial real estate, and multi-family mortgages. Average loans held for investment decreased $6.3 million compared to $1.69 billion for the quarter ended September 30, 2024. The decrease was primarily due to decreases in construction and one- to four-family mortgages.
    • Net interest margin increased 17 basis points to 2.42% for the quarter ended December 31, 2024 compared to 2.25% for the quarter ended December 31, 2023, which was primarily driven by an increase in weighted average yield on loans receivable and held for sale offset by a result of an increase in weighted average cost of deposits and borrowings as the federal funds rate increases resulted in increased funding rates. Net interest margin increased 29 basis points compared to 2.13% for the quarter ended September 30, 2024, primarily driven by an increase in weighted average yield on loans receivable and held for sale and a decrease in weighted average cost of borrowings. 
    • Past due loans at the community banking segment totaled $12.8 million at December 31, 2024, $8.0 million at September 30, 2024, and $7.9 million at December 31, 2023.
    • The segment had a provision for credit losses related to funded loans of $61,000 for the quarter ended December 31, 2024, compared to a negative provision for credit losses related to funded loans of $17,000 for the quarter ended December 31, 2023. The current quarter increase was primarily due to an increase in the qualitative factors primarily related to increases in economic risks related to commercial real estate loans during the quarter offset by a decrease in historical loss rates. The provision for credit losses related to unfunded loan commitments was $270,000 for the quarter ended December 31, 2024, compared to a negative provision for credit losses related to unfunded loan commitments of $533,000 for the quarter ended December 31, 2023. The provision for credit losses related to unfunded loan commitments for the quarter ended December 31, 2024, was due primarily to an increase of construction loans that are currently waiting to be funded compared to the prior quarter end.
    • The efficiency ratio, a non-GAAP ratio, was 51.54% for the quarter ended December 31, 2024, compared to 63.26% for the quarter ended December 31, 2023.
    • Average core deposits (excluding brokered and escrow accounts) totaled $1.27 billion during the quarter ended December 31, 2024, an increase of $65.8 million, or 5.4%, compared to $1.21 billion during the quarter ended December 31, 2023. Average deposits increased $28.8 million, or 9.2% annualized, compared to $1.25 billion for the quarter ended September 30, 2024. The increases were primarily due to an increase in certificates of deposit balances. The segment had $94.3 million in brokered certificate of deposits at December 31, 2024.

    Mortgage Banking Segment

    • Pre-tax loss totaled $625,000 for the quarter ended December 31, 2024, compared to a $6.0 million of pre-tax loss for the quarter ended December 31, 2023.
    • Loan originations increased $12.3 million, or 2.7%, to $470.7 million during the quarter ended December 31, 2024, compared to $458.4 million during the quarter ended December 31, 2023. Origination volume relative to purchase activity accounted for 82.1% of originations for the quarter ended December 31, 2024, compared to 95.7% of total originations for the quarter ended December 31, 2023.
    • Mortgage banking non-interest income increased $1.4 million, or 8.9%, to $17.5 million for the quarter ended December 31, 2024, compared to $16.0 million for the quarter ended December 31, 2023.
    • Gross margin on loans sold totaled 3.74% for the quarter ended December 31, 2024, compared to 3.51% for the quarter ended December 31, 2023.
    • Total compensation, payroll taxes and other employee benefits decreased $1.1 million, or 7.4%, to $13.8 million during the quarter ended December 31, 2024, compared to $14.9 million during the quarter ended December 31, 2023. The decrease primarily related to decreased salary expense, health insurance expense, and sign-on incentives driven by reduced employee headcount and fewer new branches added over the past year.

    About Waterstone Financial, Inc.

    Waterstone Financial, Inc. is the savings and loan holding company for WaterStone Bank. WaterStone Bank was established in 1921 and offers a full suite of personal and business banking products. The Bank has branches in Wauwatosa/State St, Brookfield, Fox Point/North Shore, Franklin/Hales Corners, Germantown/Menomonee Falls, Greenfield/Loomis Rd, Milwaukee/Oklahoma Ave, Oak Creek/27th St, Oak Creek/Howell Ave, Oconomowoc/Lake Country, Pewaukee, Waukesha, West Allis/Greenfield Ave, and West Allis/National Ave, Wisconsin. WaterStone Bank is the parent company to Waterstone Mortgage, which has the ability to lend in 48 states. For more information about WaterStone Bank, go to http://www.wsbonline.com.

    Forward-Looking Statements

    This press release contains statements or information that may constitute forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include, without limitation, statements regarding expected financial and operating activities and results that are preceded by, followed by, or that include words such as “may,” “expects,” “anticipates,” “estimates” or “believes.” Any such statements are based upon current expectations that involve a number of risks and uncertainties and are subject to important factors that could cause actual results to differ materially from those anticipated by the forward-looking statements. Factors that might cause such a difference include changes in interest rates; demand for products and services; the degree of competition by traditional and nontraditional competitors; changes in banking regulation or actions by bank regulators; changes in tax laws; the impact of technological advances; governmental and regulatory policy changes; the outcomes of contingencies; trends in customer behavior as well as their ability to repay loans; changes in local real estate values; changes in the national and local economies; and other factors, including risk factors referenced in Item 1A. Risk Factors in Waterstone’s most recent Annual Report on Form 10-K and as may be described from time to time in Waterstone’s subsequent SEC filings, which factors are incorporated herein by reference. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect only Waterstone’s belief as of the date of this press release.

    Non-GAAP Financial Measures 

    Management uses non-GAAP financial information in its analysis of the Company's performance. Management believes that this non-GAAP measure provides a greater understanding of ongoing operations and enhance comparability of results of operations with prior periods. The Company’s management believes that investors may use this non-GAAP measure to analyze the Company's financial performance without the impact of unusual items or events that may obscure trends in the Company’s underlying performance. This non-GAAP data should be considered in addition to results prepared in accordance with GAAP, and is not a substitute for, or superior to, GAAP results. Limitations associated with non-GAAP financial measures include the risks that persons might disagree as to the appropriateness of items included in this measure and that different companies might calculate this measure differently.

    Contact: Mark R. Gerke
    Chief Financial Officer
    414-459-4012
    markgerke@wsbonline.com

    WATERSTONE FINANCIAL, INC. AND SUBSIDIARIES
    CONSOLIDATED STATEMENTS OF INCOME
    (Unaudited)
     
      For The Three Months Ended
    December 31,    		  For The Twelve Months Ended
    December 31,    		 
      2024  2023  2024  2023 
      (In Thousands, except per share amounts) 
    Interest income:                
    Loans $26,391  $24,288  $103,066  $90,148 
    Mortgage-related securities  1,136   1,081   4,496   4,053 
    Debt securities, federal funds sold and short-term investments  1,525   1,325   5,606   5,007 
    Total interest income  29,052   26,694   113,168   99,208 
    Interest expense:                
    Deposits  11,410   8,253   40,573   25,738 
    Borrowings  4,807   6,685   26,427   23,255 
    Total interest expense  16,217   14,938   67,000   48,993 
    Net interest income  12,835   11,756   46,168   50,215 
    Provision (credit) for credit losses  367   (435)  (168)  656 
    Net interest income after provision (credit) for loan losses  12,468   12,191   46,336   49,559 
    Noninterest income:                
    Service charges on loans and deposits  626   328   2,060   1,819 
    Increase in cash surrender value of life insurance  407   337   1,969   1,710 
    Mortgage banking income  17,365   15,830   83,565   75,686 
    Other  607   381   1,708   1,970 
    Total noninterest income  19,005   16,876   89,302   81,185 
    Noninterest expenses:                
    Compensation, payroll taxes, and other employee benefits  18,423   20,061   81,078   84,096 
    Occupancy, office furniture, and equipment  1,579   2,021   7,573   8,323 
    Advertising  727   1,030   3,554   3,779 
    Data processing  1,233   1,212   4,978   4,653 
    Communications  224   269   922   988 
    Professional fees  1,114   907   3,184   2,686 
    Real estate owned  12   1   26   4 
    Loan processing expense  486   756   3,090   3,428 
    Other  1,469   3,405   7,231   11,755 
    Total noninterest expenses  25,267   29,662   111,636   119,712 
    Income (loss) before income taxes (benefit)  6,206   (595)  24,002   11,032 
    Income tax expense (benefit)  996   (555)  5,314   1,657 
    Net income (loss) $5,210  $(40) $18,688  $9,375 
    Income (loss) per share:                
    Basic $0.28  $(0.00) $1.01  $0.47 
    Diluted $0.28  $(0.00) $1.01  $0.46 
    Weighted average shares outstanding:                
    Basic  18,335   19,380   18,556   20,158 
    Diluted  18,396   19,398   18,589   20,196 
     


    WATERSTONE FINANCIAL, INC. AND SUBSIDIARIES
    CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
     
      December 31,  December 31, 
      2024  2023 
      (Unaudited)     
    Assets (In Thousands, except per share amounts) 
    Cash $35,182  $30,667 
    Federal funds sold  4,302   5,493 
    Interest-earning deposits in other financial institutions and other short term investments  277   261 
    Cash and cash equivalents  39,761   36,421 
    Securities available for sale (at fair value)  208,549   204,907 
    Loans held for sale (at fair value)  135,909   164,993 
    Loans receivable  1,680,576   1,664,215 
    Less: Allowance for credit losses ("ACL") - loans  18,247   18,549 
    Loans receivable, net  1,662,329   1,645,666 
             
    Office properties and equipment, net  19,389   19,995 
    Federal Home Loan Bank stock (at cost)  20,295   20,880 
    Cash surrender value of life insurance  74,612   67,859 
    Real estate owned, net  505   254 
    Prepaid expenses and other assets  48,259   52,414 
    Total assets $2,209,608  $2,213,389 
             
    Liabilities and Shareholders' Equity        
    Liabilities:        
    Demand deposits $171,115  $187,107 
    Money market and savings deposits  283,243   273,233 
    Time deposits  905,539   730,284 
    Total deposits  1,359,897   1,190,624 
             
    Borrowings  446,519   611,054 
    Advance payments by borrowers for taxes  5,630   6,607 
    Other liabilities  58,427   61,048 
    Total liabilities  1,870,473   1,869,333 
             
    Shareholders' equity:        
    Preferred stock  -   - 
    Common stock  193   203 
    Additional paid-in capital  91,214   103,908 
    Retained earnings  277,196   269,606 
    Unearned ESOP shares  (10,682)  (11,869)
    Accumulated other comprehensive loss, net of taxes  (18,786)  (17,792)
    Total shareholders' equity  339,135   344,056 
    Total liabilities and shareholders' equity $2,209,608  $2,213,389 
             
    Share Information        
    Shares outstanding  19,343   20,315 
    Book value per share $17.53  $16.94 
     


    WATERSTONE FINANCIAL, INC. AND SUBSIDIARIES
    SUMMARY OF KEY QUARTERLY FINANCIAL DATA
    (Unaudited)
     
      At or For the Three Months Ended 
      December 31,  September 30,  June 30,  March 31,  December 31, 
      2024  2024  2024  2024  2023 
      (Dollars in Thousands, except per share amounts) 
    Condensed Results of Operations:                    
    Net interest income $12,835  $11,517  $10,679  $11,137  $11,756 
    Provision (credit) for credit losses  367   (377)  (225)  67   (435)
    Total noninterest income  19,005   22,552   26,497   21,248   16,876 
    Total noninterest expense  25,267   28,560   30,259   27,550   29,662 
    Income (loss) before income taxes (benefit)  6,206   5,886   7,142   4,768   (595)
    Income tax expense (benefit)  996   1,158   1,430   1,730   (555)
    Net income (loss) $5,210  $4,728  $5,712  $3,038  $(40)
    Income (loss) per share – basic $0.28  $0.26  $0.31  $0.16  $(0.00)
    Income (loss) per share – diluted $0.28  $0.26  $0.31  $0.16  $(0.00)
    Dividends declared per common share $0.15  $0.15  $0.15  $0.15  $0.15 
                         
    Performance Ratios (annualized):                    
    Return on average assets - QTD  0.94%  0.83%  1.02%  0.56%  -0.01%
    Return on average equity - QTD  6.05%  5.55%  6.84%  3.56%  -0.05%
    Net interest margin - QTD  2.42%  2.13%  2.01%  2.15%  2.25%
                         
    Return on average assets - YTD  0.84%  0.81%  0.79%  0.56%  0.44%
    Return on average equity - YTD  5.48%  5.30%  5.17%  3.56%  2.62%
    Net interest margin - YTD  2.17%  2.09%  2.08%  2.15%  2.46%
                         
    Asset Quality Ratios:                    
    Past due loans to total loans  0.95%  0.63%  0.76%  0.64%  0.68%
    Nonaccrual loans to total loans  0.34%  0.32%  0.33%  0.29%  0.29%
    Nonperforming assets to total assets  0.28%  0.25%  0.25%  0.23%  0.23%
    Allowance for credit losses - loans to loans receivable  1.09%  1.07%  1.10%  1.10%  1.11%
     



    WATERSTONE FINANCIAL, INC. AND SUBSIDIARIES
    SUMMARY OF QUARTERLY AVERAGE BALANCES AND YIELD/COSTS
    (Unaudited)
     
      At or For the Three Months Ended 
      December 31,  September 30,  June 30,  March 31,  December 31, 
      2024  2024  2024  2024  2023 
    Average balances (Dollars in Thousands) 
    Interest-earning assets                    
    Loans receivable and held for sale $1,819,574  $1,870,627  $1,859,608  $1,805,102  $1,797,988 
    Mortgage related securities  168,521   170,221   171,895   172,077   172,863 
    Debt securities, federal funds sold and short term investments  124,658   115,270   107,992   110,431   106,504 
    Total interest-earning assets  2,112,753   2,156,118   2,139,495   2,087,610   2,077,355 
    Noninterest-earning assets  100,627   104,600   104,019   103,815   105,073 
    Total assets $2,213,380  $2,260,718  $2,243,514  $2,191,425  $2,182,428 
                         
    Interest-bearing liabilities                    
    Demand accounts $92,247  $89,334  $91,300  $87,393  $91,868 
    Money market, savings, and escrow accounts  306,478   304,116   293,483   281,171   302,121 
    Certificates of deposit - retail  810,340   786,228   758,252   739,543   735,418 
    Certificates of deposit - brokered  59,254   -   -   -   - 
    Total interest-bearing deposits  1,268,319   1,179,678   1,143,035   1,108,107   1,129,407 
    Borrowings  464,964   600,570   622,771   602,724   549,210 
    Total interest-bearing liabilities  1,733,283   1,780,248   1,765,806   1,710,831   1,678,617 
    Noninterest-bearing demand deposits  87,889   91,532   93,637   92,129   102,261 
    Noninterest-bearing liabilities  49,645   49,787   48,315   45,484   56,859 
    Total liabilities  1,870,817   1,921,567   1,907,758   1,848,444   1,837,737 
    Equity  342,563   339,151   335,756   342,981   344,691 
    Total liabilities and equity $2,213,380  $2,260,718  $2,243,514  $2,191,425  $2,182,428 
                         
    Average Yield/Costs (annualized)                    
    Loans receivable and held for sale  5.75%  5.65%  5.54%  5.46%  5.36%
    Mortgage related securities  2.67%  2.66%  2.63%  2.57%  2.48%
    Debt securities, federal funds sold and short term investments  4.85%  5.05%  4.82%  4.82%  4.94%
    Total interest-earning assets  5.46%  5.39%  5.27%  5.18%  5.10%
                         
    Demand accounts  0.11%  0.11%  0.11%  0.11%  0.11%
    Money market and savings accounts  2.00%  1.94%  1.89%  1.79%  1.64%
    Certificates of deposit - retail  4.53%  4.54%  4.41%  4.19%  3.76%
    Certificates of deposit - brokered  4.18%  0.00%  0.00%  0.00%  0.00%
    Total interest-bearing deposits  3.58%  3.53%  3.42%  3.26%  2.90%
    Borrowings  4.11%  4.77%  4.92%  4.54%  4.83%
    Total interest-bearing liabilities  3.72%  3.95%  3.95%  3.71%  3.53%
     


    COMMUNITY BANKING SEGMENT
    SUMMARY OF KEY QUARTERLY FINANCIAL DATA
    (Unaudited)
     
      At or For the Three Months Ended 
      December 31,  September 30,  June 30,  March 31,  December 31, 
      2024  2024  2024  2024  2023 
      (Dollars in Thousands) 
    Condensed Results of Operations:                    
    Net interest income $12,886  $12,250  $11,234  $11,598  $12,056 
    Provision (credit) for credit losses  331   (302)  (279)  105   (550)
    Total noninterest income  1,595   1,227   1,491   990   894 
    Noninterest expenses:                    
    Compensation, payroll taxes, and other employee benefits  4,883   5,326   5,116   5,360   5,397 
    Occupancy, office furniture and equipment  825   904   983   1,000   916 
    Advertising  204   311   229   174   363 
    Data processing  691   720   687   693   626 
    Communications  89   80   72   65   75 
    Professional fees  196   190   177   208   186 
    Real estate owned  12   -   1   13   1 
    Loan processing expense  -   -   -   -   - 
    Other  563   602   672   691   628 
    Total noninterest expense  7,463   8,133   7,937   8,204   8,192 
    Income before income taxes  6,687   5,646   5,067   4,279   5,308 
    Income tax expense  1,399   941   718   1,639   1,234 
    Net income $5,288  $4,705  $4,349  $2,640  $4,074 
                         
    Efficiency ratio - QTD (non-GAAP)  51.54%  60.35%  62.37%  65.17%  63.26%
    Efficiency ratio - YTD (non-GAAP)  59.58%  62.58%  63.77%  65.17%  56.86%
     


    MORTGAGE BANKING SEGMENT
    SUMMARY OF KEY QUARTERLY FINANCIAL DATA
    (Unaudited)
     
      At or For the Three Months Ended 
      December 31,  September 30,  June 30,  March 31,  December 31, 
      2024  2024  2024  2024  2023 
      (Dollars in Thousands) 
    Condensed Results of Operations:                    
    Net interest loss $(92) $(760) $(552) $(541) $(367)
    Provision (credit) for credit losses  36   (75)  54   (38)  115 
    Total noninterest income  17,455   21,386   25,081   20,328   16,028 
    Noninterest expenses:                    
    Compensation, payroll taxes, and other employee benefits  13,781   15,930   16,886   14,756   14,881 
    Occupancy, office furniture and equipment  754   953   1,046   1,108   1,105 
    Advertising  523   615   758   740   667 
    Data processing  542   570   549   508   583 
    Communications  135   152   168   161   194 
    Professional fees  917   379   569   520   704 
    Real estate owned  -   -   -   -   - 
    Loan processing expense  486   697   861   1,046   756 
    Other  814   1,261   1,641   617   2,701 
    Total noninterest expense  17,952   20,557   22,478   19,456   21,591 
    (Loss) income before income taxes (benefit) expense  (625)  144   1,997   369   (6,045)
    Income tax (benefit) expense  (428)  194   684   71   (1,827)
    Net (loss) income $(197) $(50) $1,313  $298  $(4,218)
                         
    Efficiency ratio - QTD (non-GAAP)  103.39%  99.67%  91.64%  98.33%  137.86%
    Efficiency ratio - YTD (non-GAAP)  97.74%  96.23%  94.62%  98.33%  116.99%
                         
    Loan originations $470,650  $558,729  $634,109  $485,109  $458,363 
    Purchase  82.1%  88.9%  92.7%  93.0%  95.7%
    Refinance  17.9%  11.1%  7.3%  7.0%  4.3%
    Gross margin on loans sold(1)  3.74%  3.83%  3.93%  4.10%  3.51%

    (1) Gross margin on loans sold equals mortgage banking income (excluding the change in interest rate lock value) divided by total loan originations


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