Waterstone Financial (WSBF) Q1 2025 earnings summary

Executive summary

• Net income was $3.0 million for Q1 2025, flat year-over-year, with EPS of $0.17 (basic and diluted), up from $0.16, aided by share repurchases.

• Community Banking delivered strong results despite a challenging rate environment, while Mortgage Banking posted a net loss due to lower originations and legal expenses.

• Book value per share increased to $17.70 at March 31, 2025, up from $17.53 at year-end 2024.

• Total assets decreased by $34.2 million, or 1.5%, to $2.18 billion at March 31, 2025, mainly due to lower loans receivable and held for sale.

Financial highlights

• Net interest income rose 12.9% year-over-year to $12.6 million, with net interest margin up to 2.47% from 2.15%.

• Annualized return on average assets was 0.57% and return on average equity was 3.61% for Q1 2025.

• Noninterest income fell 19.5% to $17.1 million, mainly due to a 22.6% drop in mortgage banking income as origination volumes and gross margins declined.

• Noninterest expenses decreased 4.4% to $26.4 million, with compensation and benefits down 14.2% due to lower headcount and commissions in mortgage banking.

• Dividends declared were $0.15 per share; 237,000 shares repurchased at $13.37 per share.

Outlook and guidance

• Management expects continued pressure on mortgage banking due to industry competition, higher rates, and economic risks, but stable performance in community banking.

• No material changes in risk factors or forward-looking statements since the last annual report; management continues to monitor economic and market conditions.