EX-99.1 2 tfslfy24mar8kexhibits.htm EX-99.1 Document

Contact: Jennifer Rosa         (216) 429-5037 Exhibit 99.1
For release April 30, 2024

TFS FINANCIAL CORPORATION ANNOUNCES SECOND QUARTER EARNINGS
Quarter Reflects Portfolio Strength; Expense Management
(Cleveland, OH - April 30, 2024) - TFS Financial Corporation (NASDAQ: TFSL) (the "Company"), the holding company for Third Federal Savings and Loan Association of Cleveland (the "Association"), today announced results for the quarter and six months ended March 31, 2024.
“We continue to follow the same philosophy my parents did when they started Third Federal more than 85 years ago – structuring the company to survive and thrive in any economic scenario,” said Chairman and CEO Marc A. Stefanski. “Our tier 1 capital ratio is nearly 11 percent. We don’t have commercial loans in our portfolio. It consists of single-family, owner-occupied mortgages with an average credit score of 762 and only 0.19 percent in total delinquencies. Our strong retail deposit base is nearly 100 percent FDIC insured, and deposits have grown $500 million the first six months of the fiscal year. In an effort to offset the challenging rate environment, we are effectively managing both our cost of funds and our expense-to-assets, currently at 1.20 percent, to ensure that Third Federal remains strong, stable, and safe.”
The Company reported net income of $20.7 million for the quarter ended March 31, 2024, consistent with $20.7 million of net income for the quarter ended December 31, 2023. Changes of note included an increase in net interest income offset by an increase in non-interest expenses.
Net interest income increased $2.3 million, or 3%, to $71.4 million for the quarter ended March 31, 2024 from $69.1 million for the quarter ended December 31, 2023. Interest income was higher due to an increase in the average balance and yield of interest-earning cash equivalents and an increase in total yield on loans. The interest rate spread was 1.43% for the quarter ended March 31, 2024 compared to 1.39% for the quarter ended December 31, 2023. The net interest margin was 1.71% for the quarter ended March 31, 2024 compared to 1.68% for the prior quarter.
During each of the quarters ended March 31, 2024 and December 31, 2023, there was a $1.0 million release of provision for credit losses. Recoveries of loan amounts previously charged off and low levels of current loan charge-offs resulted in the release of provision. Net recoveries were $1.3 million for the quarter ended March 31, 2024 compared to $1.0 million for the previous quarter. The total allowance for credit losses increased $0.3 million during the quarter ended March 31, 2024 to $94.8 million, or 0.63% of total loans receivable, from $94.6 million, or 0.62% of total loans receivable, at December 31, 2023. The increase was mainly due to an increase in the liability for unfunded commitments. This change was partially offset by a decrease in the provision for losses on loans, resulting from a decrease in the balance of loans held for investment. The total allowance for credit losses included a liability for unfunded commitments of $26.7 million and $25.5 million at March 31, 2024 and December 31, 2023, respectively.
Total non-interest expenses increased $1.9 million, or 4%, to $52.2 million for the quarter ended March 31, 2024, from $50.3 million for the quarter ended December 31, 2023. The increase was primarily due to a $0.7 million increase in marketing costs, but also included increases of $0.4 million in salaries and employee benefits, $0.5 million in office property, equipment and software, and $0.2 million in federal insurance premium and assessments.
Total assets decreased by $36.6 million, or less than 1%, to $17.02 billion at March 31, 2024 from $17.05 billion at December 31, 2023. The decrease was mainly due to a decrease in loans held for investment and Federal Home Loan Bank ("FHLB") stock partially offset by an increase in cash and cash equivalents.
Cash and cash equivalents increased $42.6 million, or 8%, to $594.3 million at March 31, 2024 from $551.8 million at December 31, 2023 due to normal fluctuations and liquidity management.
FHLB stock decreased $14.3 million to $240.4 million at March 31, 2024 from $254.7 million at December 31, 2023. The decrease is a result of stock redemptions by the FHLB. The FHLB has collateral requirements on funds borrowed that dictate the minimum amount of stock owned at any given time.
Loans held for investment, net of allowance and deferred loan expenses, decreased $57.6 million, or less than 1%, to $15.15 billion at March 31, 2024 from $15.21 billion at December 31, 2023. During the quarter ended March 31, 2024, residential core mortgage loans decreased $178.7 million and the home equity loans and lines of credit portfolio increased
$121.9 million. Repayments and sales of residential mortgage loans held for investment outpaced originations during the quarter ended March 31, 2024. The volume of mortgage loan originations remains lower due to a relatively high interest rate environment, resulting in minimal refinance activity.


Compared to December 31, 2023, deposits increased by $14.6 million to $9.94 billion at March 31, 2024, consisting of a $412.6 million increase in retail certificates of deposit ("CDs"), and decreases of $223.3 million in brokered CDs, $95.3 million in savings accounts, $41.3 million in money market deposit accounts, and $39.6 million in checking accounts.
Borrowed funds decreased $75.1 million to $4.96 billion at March 31, 2024 from $5.03 billion at December 31, 2023, as maturing borrowings were paid off with cash and partially replaced with retail deposits.
Fiscal Year-To-Date 2024
The Company reported net income of $41.4 million for the six months ended March 31, 2024 compared to net income of $38.1 million for the six months ended March 31, 2023. The $3.3 million increase was mainly due to an increase in non-interest income and a decrease in non-interest expenses, partially offset by a decrease in net interest income.
Net interest income decreased by $4.0 million, or 3%, to $140.5 million for the six months ended March 31, 2024 compared to $144.4 million for the six months ended March 31, 2023. The decrease was primarily due to a change in deposit mix, along with growth in the CD portfolio and repricing of existing CDs. This was partially offset by an increase in the average balance and yield of total interest-earning assets. The interest rate spread was 1.40% for the six months ended March 31, 2024, a 26 basis point decrease from 1.66% for the six months ended March 31, 2023. The net interest margin was 1.70% for the six months ended March 31, 2024 compared to 1.86% for the prior year period.
During each of the six months ended March 31, 2024 and March 31, 2023, there was a $2.0 million release of provision for credit losses. Net loan recoveries totaled $2.3 million for the six months ended March 31, 2024 and $2.9 million for the same period in the prior year.
The total allowance for credit losses at March 31, 2024 was $94.8 million, or 0.63% of total loans receivable, compared to $104.8 million, or 0.69% of total loans receivable, at September 30, 2023. The decrease was almost entirely due to the adoption of recently issued accounting guidance related to the accounting for troubled debt restructurings, which resulted in a $10.2 million reduction to the allowance and a $7.9 million adjustment to retained earnings, net of tax. The allowance for credit losses included $26.7 million and $27.5 million in liabilities for unfunded commitments at March 31, 2024 and September 30, 2023, respectively. Total loan delinquencies increased $5.0 million to $28.4 million, or 0.19% of total loans receivable, at March 31, 2024 from $23.4 million, or 0.16% of total loans receivable, at September 30, 2023. Non-accrual loans increased $3.4 million to $35.3 million, or 0.23% of total loans receivable, at March 31, 2024 from $31.9 million, or 0.21% of total loans receivable, at September 30, 2023.
Total non-interest income increased $1.5 million, or 14%, to $12.0 million for the six months ended March 31, 2024 from $10.5 million for the six months ended March 31, 2023. The increase was mainly due to a $1.0 million increase in income and death benefits from life insurance contracts. Additionally, there was a $0.5 million increase in other non-interest income that primarily related to changes in fair value on commitments to originate mortgage loans.
Total non-interest expenses decreased $6.3 million, or 6%, to $102.5 million for the six months ended March 31, 2024, from $108.8 million for the six months ended March 31, 2023 and included decreases of $4.9 million in marketing costs and $4.2 million in salaries and employee benefits, partially offset by increases of $1.6 million in federal ("FDIC") insurance premiums, $0.7 million in other operating expenses and $0.5 million in office property, equipment and software expenses. The decrease in salaries and employee benefits is primarily related to decreases in staffing and accruals for discretionary incentive payments. FDIC premiums increased due to growth in deposits and a two basis point increase in FDIC assessment rates that went into effect on January 1, 2023. The increase in other operating expenses was mainly due to increases in loan subsidy and down payment assistance programs. These programs expand opportunities for borrowers, particularly those working with our community housing partners, to obtain home financing.
Total assets increased by $99.2 million, or 1%, to $17.02 billion at March 31, 2024 from $16.92 billion at September 30, 2023. The increase was mainly the result of an increases in cash and cash equivalents partially offset by a decrease in loans held for investment.
Cash and cash equivalents increased $127.6 million, or 27%, to $594.3 million at March 31, 2024 from $466.7 million at September 30, 2023 due to normal fluctuations and liquidity management.
Loans held for investment, net of allowance and deferred loan expenses, decreased $16.1 million, or less than 1%, to $15.15 billion at March 31, 2024 from $15.17 billion at September 30, 2023. The residential mortgage loan portfolio decreased $307.4 million, to $11.77 billion, and home equity loans and lines of credit increased $289.1 million, to $3.32 billion. Loans originated and purchased during the six months ended March 31, 2024 included $408.8 million of residential mortgage loans and $915.4 million of equity loans and lines of credit compared to $821.9 million of residential mortgage loans and $720.0 million of equity loans and lines of credit originated or purchased during the six months ended March 31, 2023. The decrease in


mortgage loan originations was primarily due to a relatively high interest rate environment, resulting in minimal refinance activity. New mortgage loans included 93% purchases and 24% adjustable rate loans during the six months ended March 31, 2024. There were $115.4 million of long-term fixed-rate mortgage loans sold during the six months ended March 31, 2024.
Deposits increased $485.8 million, or 5%, to $9.94 billion at March 31, 2024 from $9.45 billion at September 30, 2023. The increase was the result of an $868.4 million increase in certificates of deposit, partially offset by a $194.2 million decrease in savings accounts, a $106.6 million decrease in money market deposit accounts and a $92.3 million decrease in checking accounts. There were $1.26 billion in brokered deposits at March 31, 2024 compared to $1.16 billion at September 30, 2023. At March 31, 2024, brokered deposits included $725.0 million of three-month certificates of deposit accounts, aligned with interest rate swap contracts, with a remaining weighted average effective maturity of approximately 3.0 years.
Borrowed funds decreased $318.2 million, or 6%, to $4.96 billion at March 31, 2024 from $5.27 billion at September 30, 2023. The decrease was primarily due to borrowings paid off at maturity. The total balance of borrowed funds at March 31, 2024, all from the FHLB, included $1.83 billion of term advances with a weighted average maturity of approximately 2.2 years, and $3.10 billion of term advances, aligned with interest rate swap contracts, with a remaining weighted average effective maturity of approximately 3.4 years. Additional borrowing capacity at the FHLB was $1.88 billion at March 31, 2024, available for terms less than one year.
Total shareholders' equity decreased $19.9 million, or 1%, to $1.91 billion at March 31, 2024 from $1.93 billion at September 30, 2023. Activity reflects $41.4 million of net income, a $7.9 million adjustment to retained earnings related to a change in accounting principle described above with respect to changes in the allowance for credit losses, a $42.8 million net decrease in accumulated other comprehensive income, dividends paid of $29.4 million and net positive adjustments of $3.0 million related to our stock compensation and employee stock ownership plans. The change in accumulated other comprehensive income is primarily due to a net decrease in unrealized gains and losses on swap contracts. There were no stock repurchases during the six months ended March 31, 2024. The Company's eighth stock repurchase program allows for a total of 10,000,000 shares to be repurchased, with 5,191,951 shares authorized for repurchase at March 31, 2024.
The Company declared and paid a quarterly dividend of $0.2825 per share during each of the quarters in fiscal year 2024. As a result of a mutual member vote, Third Federal Savings and Loan Association of Cleveland, MHC (the "MHC"), the mutual holding company that owns approximately 81% of the outstanding stock of the Company, was able to waive its receipt of its share of the dividend paid. Under Federal Reserve regulations, the MHC is required to obtain the approval of its members every 12 months for the MHC to waive its right to receive dividends. As a result of a July 11, 2023 member vote and the
subsequent non-objection of the Federal Reserve, the MHC has the approval to waive receipt of up to $1.13 per share of possible dividends to be declared on the Company’s common stock during the twelve months subsequent to the members’ approval (i.e., through July 11, 2024), including a total of up to $0.565 remaining. The MHC has conducted the member vote to approve the dividend waiver each of the past ten years under Federal Reserve regulations and for each of those ten years, approximately 97% of the votes cast were in favor of the waiver.
The Company operates under the capital requirements for the standardized approach of the Basel III capital framework
for U.S. banking organizations (“Basel III Rules”). At March 31, 2024 all of the Company's capital ratios substantially exceed the amounts required for the Company to be considered "well capitalized" for regulatory capital purposes. The Company's Tier 1 leverage ratio was 10.72%, its Common Equity Tier 1 and Tier 1 ratios were each 19.05% and its total capital ratio was 19.78%.
Presentation slides as of March 31, 2024 will be available on the Company's website, www.thirdfederal.com, under the Investor Relations link within the "Recent Presentations" menu, beginning May 1, 2024. The Company will not be hosting a conference call to discuss its operating results.
Third Federal Savings and Loan Association is a leading provider of savings and mortgage products, and operates under the values of love, trust, respect, a commitment to excellence and fun. Founded in Cleveland in 1938 as a mutual association by Ben and Gerome Stefanski, Third Federal’s mission is to help people achieve the dream of home ownership and financial security. It became part of a public company in 2007 and celebrated its 85th anniversary in May 2023. Third Federal, which lends in 26 states and the District of Columbia, is dedicated to serving consumers with competitive rates and outstanding service. Third Federal, an equal housing lender, has 21 full service branches in Northeast Ohio, four lending offices in Central and Southern Ohio, and 16 full service branches throughout Florida. As of March 31, 2024, the Company’s assets totaled $17.02 billion.


Forward Looking Statements
     This report contains forward-looking statements, which can be identified by the use of such words as estimate, project, believe, intend, anticipate, plan, seek, expect and similar expressions. These forward-looking statements include, among other things:
●statements of our goals, intentions and expectations;
●statements regarding our business plans and prospects and growth and operating strategies;
●statements concerning trends in our provision for credit losses and charge-offs on loans and off-balance sheet exposures;
●statements regarding the trends in factors affecting our financial condition and results of operations, including credit quality of our loan and investment portfolios; and
●estimates of our risks and future costs and benefits.
     These forward-looking statements are subject to significant risks, assumptions and uncertainties, including, among other things, the following important factors that could affect the actual outcome of future events:
●significantly increased competition among depository and other financial institutions, including with respect to our ability to charge overdraft fees;
●inflation and changes in the interest rate environment that reduce our interest margins or reduce the fair value of financial instruments, or our ability to originate loans;
●general economic conditions, either globally, nationally or in our market areas, including employment prospects, real estate values and conditions that are worse than expected;
●
the strength or weakness of the real estate markets and of the consumer and commercial credit sectors and its impact on the credit quality of our loans and other assets, and changes in estimates of the allowance for credit losses;
●decreased demand for our products and services and lower revenue and earnings because of a recession or other events;
●changes in consumer spending, borrowing and savings habits, including repayment speeds on loans;
●adverse changes and volatility in the securities markets, credit markets or real estate markets;
●our ability to manage market risk, credit risk, liquidity risk, reputational risk, regulatory risk and compliance risk;
●our ability to access cost-effective funding;
●changes in liquidity, including the size and composition of our deposit portfolio and the percentage of uninsured deposits in the portfolio;
●legislative or regulatory changes that adversely affect our business, including changes in regulatory costs and capital requirements and changes related to our ability to pay dividends and the ability of Third Federal Savings, MHC to waive dividends;
●changes in accounting policies and practices, as may be adopted by the bank regulatory agencies, the FASB or the PCAOB;
●the adoption of implementing regulations by a number of different regulatory bodies, and uncertainty in the exact nature, extent and timing of such regulations and the impact they will have on us;
●our ability to enter new markets successfully and take advantage of growth opportunities;
●our ability to retain key employees;
●future adverse developments concerning Fannie Mae or Freddie Mac;
●changes in monetary and fiscal policy of the U.S. Government, including policies of the U.S. Treasury, the Federal Reserve System, Fannie Mae, the OCC, FDIC, and others;
●the continuing governmental efforts to restructure the U.S. financial and regulatory system;
●the ability of the U.S. Government to remain open, function properly and manage federal debt limits;
●changes in policy and/or assessment rates of taxing authorities that adversely affect us or our customers;
●changes in accounting and tax estimates;
●
changes in our organization and changes in expense trends, including but not limited to trends affecting non-performing assets, charge-offs and provisions for credit losses;
●the inability of third-party providers to perform their obligations to us;
●our ability to retain key employees;
●civil unrest;
●cyber-attacks, computer viruses and other technological risks that may breach the security of our websites or other systems to obtain unauthorized access to confidential information, destroy data or disable our systems; and
●the impact of wide-spread pandemic, including COVID-19, and related government action, on our business and the economy.
     Because of these and other uncertainties, our actual future results may be materially different from the results indicated by any forward-looking statements. Any forward-looking statement made by us in this report speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future developments or otherwise, except as may be required by law.


TFS FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CONDITION (unaudited)
(In thousands, except share data)
March 31,
2024		December 31,
2023		September 30,
2023
ASSETS
Cash and due from banks$27,381 $45,858 $29,134 
Other interest-earning cash equivalents566,953 505,910 437,612 
Cash and cash equivalents594,334 551,768 466,746 
Investment securities available for sale520,172 525,175 508,324 
Mortgage loans held for sale 9,698 1,095 3,260 
Loans held for investment, net:
Mortgage loans15,152,032 15,210,653 15,177,844 
Other loans4,709 4,811 4,411 
Deferred loan expenses, net61,047 60,862 60,807 
Allowance for credit losses on loans(68,169)(69,084)(77,315)
Loans, net15,149,619 15,207,242 15,165,747 
Mortgage loan servicing rights, net7,547 7,634 7,400 
Federal Home Loan Bank stock, at cost240,365 254,700 247,098 
Real estate owned, net230 1,070 1,444 
Premises, equipment, and software, net33,885 34,209 34,708 
Accrued interest receivable56,887 55,614 53,910 
Bank owned life insurance contracts313,458 311,848 312,072 
Other assets90,955 103,436 117,270 
TOTAL ASSETS$17,017,150 $17,053,791 $16,917,979 
LIABILITIES AND SHAREHOLDERS’ EQUITY
Deposits$9,935,631 $9,921,056 $9,449,820 
Borrowed funds4,955,438 5,030,561 5,273,637 
Borrowers’ advances for insurance and taxes99,492 109,093 124,417 
Principal, interest, and related escrow owed on loans serviced25,946 29,204 29,811 
Accrued expenses and other liabilities93,146 97,150 112,933 
Total liabilities15,109,653 15,187,064 14,990,618 
Commitments and contingent liabilities
Preferred stock, $0.01 par value, 100,000,000 shares authorized, none issued and outstanding— — — 
Common stock, $0.01 par value, 700,000,000 shares authorized; 332,318,750 shares issued3,323 3,323 3,323 
Paid-in capital1,751,960 1,750,440 1,755,027 
Treasury stock, at cost(772,195)(772,195)(776,101)
Unallocated ESOP shares(24,917)(26,000)(27,084)
Retained earnings—substantially restricted906,908 900,973 886,984 
Accumulated other comprehensive income 42,418 10,186 85,212 
Total shareholders’ equity1,907,497 1,866,727 1,927,361 
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY$17,017,150 $17,053,791 $16,917,979 




TFS FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (unaudited)
(In thousands, except share and per share data)
For the three months ended
 March 31,
2024		December 31,
2023		September 30,
2023		June 30,
2023		March 31,
2023
INTEREST AND DIVIDEND INCOME:
Loans, including fees$162,970 $162,035 $154,763 $144,347 $136,835 
Investment securities available for sale4,476 4,395 4,141 3,712 3,455 
Other interest and dividend earning assets16,047 10,729 9,836 8,598 7,262 
Total interest and dividend income183,493 177,159 168,740 156,657 147,552 
INTEREST EXPENSE:
Deposits72,685 64,326 55,565 48,905 39,876 
Borrowed funds39,430 43,741 42,812 38,973 38,408 
Total interest expense112,115 108,067 98,377 87,878 78,284 
NET INTEREST INCOME71,378 69,092 70,363 68,779 69,268 
PROVISION (RELEASE) FOR CREDIT LOSSES(1,000)(1,000)500 — (1,000)
NET INTEREST INCOME AFTER PROVISION (RELEASE) FOR CREDIT LOSSES72,378 70,092 69,863 68,779 70,268 
NON-INTEREST INCOME:
Fees and service charges, net of amortization1,845 1,748 2,061 1,919 1,924 
Net gain (loss) on the sale of loans442 481 (119)21 579 
Increase in and death benefits from bank owned life insurance contracts2,193 3,191 2,204 2,790 2,123 
Other1,242 895 954 1,113 703 
Total non-interest income5,722 6,315 5,100 5,843 5,329 
NON-INTEREST EXPENSE:
Salaries and employee benefits27,501 27,116 28,660 25,332 30,390 
Marketing services5,099 4,431 3,881 7,023 6,671 
Office property, equipment and software7,303 6,845 6,886 7,246 6,802 
Federal insurance premium and assessments4,013 3,778 3,629 3,574 3,488 
State franchise tax1,238 1,176 1,185 1,230 1,268 
Other expenses7,044 6,931 7,243 8,472 6,955 
Total non-interest expense52,198 50,277 51,484 52,877 55,574 
INCOME BEFORE INCOME TAXES25,902 26,130 23,479 21,745 20,023 
INCOME TAX EXPENSE5,189 5,423 3,933 4,142 4,115 
NET INCOME$20,713 $20,707 $19,546 $17,603 $15,908 
Earnings per share - basic and diluted $0.07 $0.07 $0.07 $0.06 $0.06 
Weighted average shares outstanding
Basic278,183,041 277,841,526 277,589,775 277,472,312 277,361,293 
Diluted279,046,837 279,001,898 278,826,441 278,590,810 278,499,145 



TFS FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (unaudited)
(In thousands, except share and per share data)
 For the Six Months Ended
March 31,
 20242023
INTEREST AND DIVIDEND INCOME:
Loans, including fees$325,005 $266,500 
Investment securities available for sale8,871 6,517 
Other interest and dividend earning assets26,776 13,505 
Total interest and dividend income360,652 286,522 
INTEREST EXPENSE:
Deposits137,011 69,731 
Borrowed funds83,171 72,366 
Total interest expense220,182 142,097 
NET INTEREST INCOME140,470 144,425 
PROVISION (RELEASE) FOR CREDIT LOSSES(2,000)(2,000)
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES142,470 146,425 
NON-INTEREST INCOME:
Fees and service charges, net of amortization3,593 3,860 
Net gain on the sale of loans923 596 
Increase in and death benefits from bank owned life insurance contracts5,384 4,361 
Other2,137 1,669 
Total non-interest income12,037 10,486 
NON-INTEREST EXPENSE:
Salaries and employee benefits54,617 58,793 
Marketing services9,530 14,384 
Office property, equipment and software14,148 13,602 
Federal insurance premium and assessments7,791 6,249 
State franchise tax2,414 2,476 
Other expenses13,975 13,264 
Total non-interest expense102,475 108,768 
INCOME BEFORE INCOME TAXES52,032 48,143 
INCOME TAX EXPENSE10,612 10,042 
NET INCOME$41,420 $38,101 
Earnings per share - basic and diluted$0.15 $0.13 
Weighted average shares outstanding
Basic278,011,351 277,340,877 
Diluted279,019,468 278,472,705 


TFS FINANCIAL CORPORATION AND SUBSIDIARIES
AVERAGE BALANCES AND YIELDS (unaudited)
Three Months EndedThree Months EndedThree Months Ended
March 31, 2024December 31, 2023March 31, 2023
 Average
Balance		Interest
Income/
Expense		Yield/
Cost (1)		Average
Balance		Interest
Income/
Expense		Yield/
Cost (1)		Average
Balance		Interest
Income/
Expense		Yield/
Cost (1)
 (Dollars in thousands)
Interest-earning assets:
  Interest-earning cash
equivalents		$720,657 $9,919 5.51 %$398,506 $5,124 5.14 %$350,437 $3,947 4.51 %
  Investment securities72,091 907 5.03 %64,778 850 5.25 %3,649 11 1.21 %
  Mortgage-backed securities448,653 3,569 3.18 %444,411 3,545 3.19 %475,902 3,444 2.89 %
  Loans (2)15,163,185 162,970 4.30 %15,232,349 162,035 4.26 %14,517,771 136,835 3.77 %
  Federal Home Loan Bank stock244,560 6,128 10.02 %270,540 5,605 8.29 %230,496 3,315 5.75 %
Total interest-earning assets16,649,146 183,493 4.41 %16,410,584 177,159 4.32 %15,578,255 147,552 3.79 %
Noninterest-earning assets505,145 553,461 527,935 
Total assets$17,154,291 $16,964,045 $16,106,190 
Interest-bearing liabilities:
  Checking accounts$887,584 98 0.04 %$937,817 118 0.05 %$1,128,560 2,229 0.79 %
  Savings accounts1,561,331 5,598 1.43 %1,721,466 6,912 1.61 %1,668,115 5,028 1.21 %
  Certificates of deposit7,548,314 66,989 3.55 %6,847,482 57,296 3.35 %6,110,460 32,619 2.14 %
  Borrowed funds5,033,253 39,430 3.13 %5,228,239 43,741 3.35 %5,112,767 38,408 3.00 %
Total interest-bearing liabilities15,030,482 112,115 2.98 %14,735,004 108,067 2.93 %14,019,902 78,284 2.23 %
Noninterest-bearing liabilities212,206 278,801 209,161 
Total liabilities15,242,688 15,013,805 14,229,063 
Shareholders’ equity1,911,603 1,950,240 1,877,127 
Total liabilities and shareholders’ equity$17,154,291 $16,964,045 $16,106,190 
Net interest income$71,378 $69,092 $69,268 
Interest rate spread (1)(3)1.43 %1.39 %1.56 %
Net interest-earning assets (4)$1,618,664 $1,675,580 $1,558,353 
Net interest margin (1)(5)1.71 %1.68 %1.78 %
Average interest-earning assets to average interest-bearing liabilities110.77 %111.37 %111.12 %
Selected performance ratios:
Return on average assets (1)0.48 %0.49 %0.40 %
Return on average equity (1)4.33 %4.25 %3.39 %
Average equity to average assets11.14 %11.50 %11.65 %
 
(1)Annualized.
(2)Loans include both mortgage loans held for sale and loans held for investment.
(3)Interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.
(4)Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
(5)Net interest margin represents net interest income divided by total interest-earning assets.








TFS FINANCIAL CORPORATION AND SUBSIDIARIES
AVERAGE BALANCES AND YIELDS (unaudited)
Six Months EndedSix Months Ended
March 31, 2024March 31, 2023
Average
Balance		Interest
Income/
Expense		Yield/
Cost (1)		Average
Balance		Interest
Income/
Expense		Yield/
Cost (1)
 (Dollars in thousands)
Interest-earning assets:
  Interest-earning cash
  equivalents		$559,581 $15,043 5.38 %$352,325 $7,196 4.08 %
Investment securities68,435 1,757 5.13 %3,634 22 1.21 %
Mortgage-backed securities446,532 7,114 3.19 %469,933 6,495 2.76 %
  Loans (1)15,197,767 325,005 4.28 %14,457,228 266,500 3.69 %
  Federal Home Loan Bank stock257,550 11,733 9.11 %224,889 6,309 5.61 %
Total interest-earning assets16,529,865 360,652 4.36 %15,508,009 286,522 3.70 %
Noninterest-earning assets529,303 506,658 
Total assets$17,059,168 $16,014,667 
Interest-bearing liabilities:
  Checking accounts$912,701 216 0.05 %$1,156,728 4,639 0.80 %
  Savings accounts1,641,398 12,510 1.52 %1,717,235 8,735 1.02 %
  Certificates of deposit7,197,898 124,285 3.45 %6,041,692 56,357 1.87 %
  Borrowed funds5,130,746 83,171 3.24 %4,992,956 72,366 2.90 %
Total interest-bearing liabilities14,882,743 220,182 2.96 %13,908,611 142,097 2.04 %
Noninterest-bearing liabilities245,503 233,257 
Total liabilities15,128,246 14,141,868 
Shareholders’ equity1,930,922 1,872,799 
Total liabilities and shareholders’ equity$17,059,168 $16,014,667 
Net interest income$140,470 $144,425 
Interest rate spread (1)(2)
1.40 %1.66 %
Net interest-earning assets (3)$1,647,122 $1,599,398 
Net interest margin (1)(4)
1.70 %1.86 %
Average interest-earning assets to average interest-bearing liabilities111.07 %111.50 %
Selected performance ratios:
Return on average assets (1)
0.49 %0.48 %
Return on average equity (1)
4.29 %4.07 %
Average equity to average assets11.32 %11.69 %


(1)Annualized
(2)Loans include both mortgage loans held for sale and loans held for investment.
(3)Interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.
(4)Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
(5)Net interest margin represents net interest income divided by total interest-earning assets.