On July 25, 2024, WSFS Financial Corp (WSFS, Financial) released its 8-K filing for the second quarter of 2024. WSFS Financial Corp is a savings and loan holding company operating in three segments: WSFS Bank, Cash Connect, and Wealth Management. The majority of its revenue is generated from the WSFS Bank segment, which provides loans, leases, and other financial products to commercial and consumer customers.
Performance Overview
WSFS Financial Corp reported a diluted earnings per share (EPS) of $1.16 for Q2 2024, surpassing the analyst estimate of $1.04. The company also reported a net interest margin of 3.85%, reflecting a slight increase from the previous quarter. Total net revenue for the quarter was $266.0 million, up from $251.1 million in Q1 2024.
Key Financial Achievements
WSFS Financial Corp's net income attributable to WSFS was $69.3 million, an increase from $65.8 million in Q1 2024. The company's return on average assets (ROA) was 1.34%, and return on average equity (ROE) was 11.4%. Fee revenue as a percentage of total net revenue increased to 34.4%, up from 30.2% in the previous quarter.
Income Statement Highlights
| Metric | Q2 2024 | Q1 2024 | Q2 2023 |
|---|---|---|---|
| Net Interest Income | $174.4 million | $175.3 million | $181.8 million |
| Fee Revenue | $91.6 million | $75.9 million | $66.9 million |
| Total Net Revenue | $266.0 million | $251.1 million | $248.7 million |
| Provision for Credit Losses | $19.8 million | $15.1 million | $15.8 million |
| Noninterest Expense | $155.8 million | $149.1 million | $141.3 million |
| Net Income Attributable to WSFS | $69.3 million | $65.8 million | $68.7 million |
| Earnings Per Share (EPS) | $1.16 | $1.09 | $1.12 |
Balance Sheet and Cash Flow
WSFS Financial Corp's gross loan and lease portfolio increased by $189.2 million, or 1% (6% annualized), compared to Q1 2024. Customer deposits also saw a 1% increase (3% annualized) from the previous quarter. The company's loan-to-deposit ratio was 80%, indicating continued capacity to fund future loan growth.
Asset Quality and Capital Management
Overall asset quality remained stable, with problem loans seeing a modest increase to 4.76% of total gross loans. Net charge-offs were consistent with recent history at 44 basis points. The company's total stockholders' equity increased by $16.1 million during Q2 2024, primarily due to quarterly earnings of $69.3 million.
CEO Commentary
"We are pleased to report second quarter earnings of a core ROA of 1.25% and accompanying core EPS of $1.08. Our results were highlighted by quarterly core fee revenue growth of 13%, driven by strong performance in our Cash Connect®, Wealth and Trust, Capital Markets, and Mortgage businesses. Solid annualized loan growth of 6% was driven primarily by our commercial and consumer lending portfolios while deposits increased 3% annualized and the net interest margin of 3.85% also increased slightly from the prior quarter. Our strong performance provides momentum as we head into the second half of 2024."
Conclusion
WSFS Financial Corp's strong performance in Q2 2024, driven by loan and deposit growth, as well as diversified fee revenue, positions the company well for the remainder of the year. The company's ability to exceed analyst estimates and maintain stable asset quality metrics underscores its robust financial health and strategic execution.
Explore the complete 8-K earnings release (here) from WSFS Financial Corp for further details.
