STOCKHOLDERS' EQUITY AND REGULATORY CAPITAL

12 Months Ended

Dec. 31, 2024

STOCKHOLDERS’ EQUITY AND REGULATORY CAPITAL

13. STOCKHOLDERS' EQUITY AND REGULATORY CAPITAL

Savings associations such as the Bank are subject to regulatory capital requirements administered by various banking regulators. Failure to meet minimum capital requirements could result in certain actions by regulators that could have a material effect on the Company’s Consolidated Financial Statements. Risk-based capital requirements applicable to bank holding companies and depository institutions include a minimum common equity Tier 1 capital ratio of 4.50% of risk-weighted assets, a minimum Tier 1 capital ratio of 6.00% of risk-weighted assets, and a current minimum total capital ratio of 8.00% of risk-weighted assets and a minimum Tier 1 leverage capital ratio of 4.00% of average assets.

As of December 31, 2024 and 2023, the Bank was in compliance with regulatory capital requirements and exceeded the levels necessary for the Bank to be considered “well-capitalized” as defined in the regulations.

The following table presents the capital position of the Bank and the Company as of December 31, 2024 and 2023:


	Consolidated Capital				Minimum For Capital Adequacy Purposes				To Be Well-Capitalized Under Prompt Corrective Action Provisions
(Dollars in thousands)	Amount		Percent		Amount		Percent		Amount		Percent
December 31, 2024
Total Capital (to risk-weighted assets)
Wilmington Savings Fund Society, FSB	$	2,470,183	15.13	%	$	1,306,507	8.00	%	$	1,633,133	10.00	%
WSFS Financial Corporation	2,575,170		15.77		1,306,677		8.00		1,633,346		10.00
Tier 1 Capital (to risk-weighted assets)
Wilmington Savings Fund Society, FSB	2,265,995		13.88		979,880		6.00		1,306,507		8.00
WSFS Financial Corporation	2,254,907		13.81		980,008		6.00		1,306,677		8.00
Common Equity Tier 1 Capital (to risk-weighted assets)
Wilmington Savings Fund Society, FSB	2,265,995		13.88		734,910		4.50		1,061,537		6.50
WSFS Financial Corporation	2,254,907		13.81		735,006		4.50		1,061,675		6.50
Tier 1 Leverage Capital
Wilmington Savings Fund Society, FSB	2,265,995		11.03		822,045		4.00		1,027,556		5.00
WSFS Financial Corporation	2,254,907		10.96		822,637		4.00		1,028,296		5.00

December 31, 2023
Total Capital (to risk-weighted assets)
Wilmington Savings Fund Society, FSB	$	2,382,514	14.96	%	$	1,273,856	8.00	%	$	1,592,320	10.00	%
WSFS Financial Corporation	2,426,577		15.23		1,274,611		8.00		1,593,264		10.00
Tier 1 Capital (to risk-weighted assets)
Wilmington Savings Fund Society, FSB	2,184,193		13.72		955,392		6.00		1,273,856		8.00
WSFS Financial Corporation	2,098,403		13.17		955,958		6.00		1,274,611		8.00
Common Equity Tier 1 Capital (to risk-weighted assets)
Wilmington Savings Fund Society, FSB	2,184,193		13.72		716,544		4.50		1,035,008		6.50
WSFS Financial Corporation	2,098,403		13.17		716,969		4.50		1,035,621		6.50
Tier 1 Leverage Capital
Wilmington Savings Fund Society, FSB	2,184,193		10.92		800,021		4.00		1,000,026		5.00
WSFS Financial Corporation	2,098,403		10.48		800,934		4.00		1,001,168		5.00

The Holding Company

As of December 31, 2024, the Company's capital structure includes one class of stock, $0.01 par common stock outstanding with each share having equal voting rights.

In 2005, the Trust issued Pooled Floating Rate Securities at a variable interest rate of 177 basis points over the three-month LIBOR rate with a scheduled maturity of June 1, 2035. The reference rate on these securities was updated to three-month term SOFR upon the discontinuation of LIBOR on June 30, 2023. The par value of these securities is $2.0 million and the aggregate principal is $67.0 million. The proceeds from the issue were invested in junior subordinated debentures issued by the Company. At December 31, 2024, the coupon rate of the Trust securities was 6.53%. The effective rate will vary due to fluctuations in interest rates.

The RBC Trusts, which were acquired from Bryn Mawr Bank Corporation, were utilized for the sole purpose of issuing and selling capital securities representing preferred beneficial interests. Although WSFS owns an aggregate of $0.8 million of the common securities of Trust I and Trust II, the RBC Trusts are not consolidated into the Company’s Consolidated Financial Statements as the Company is not deemed to be the primary beneficiary of these entities. Inclusive of the fair value marks, WSFS assumed junior subordinated debentures to the RBC Trusts with a current carrying value of $11.9 million each, totaling $23.8 million. The junior subordinated debentures incur interest at a coupon rate of 6.77% as of December 31, 2024. The rate resets quarterly based on three-month term SOFR plus 2.41%.

These securities are treated as borrowings with interest included in Interest on trust preferred borrowings on the Consolidated Statements of Income and included in Trust preferred borrowings in the Consolidated Statements of Financial Condition.

The Trust preferred borrowings qualify as Tier 2 capital. The Trust preferred borrowings issued in 2005 were previously Tier 1 capital, but migrated to Tier 2 capital following the acquisition of Bryn Mawr Bank Corporation and impacts of 12 C.F.R. § 217.300(c)(2)(i). The Bank is prohibited from paying any dividend or making any other capital distribution if, after making the distribution, the Bank would be under-capitalized within the meaning of the Prompt Corrective Action regulations.

At December 31, 2024, $275.4 million in cash remains at the holding company to support the parent company’s needs.

Pursuant to federal laws and regulations, the Company's ability to engage in transactions with affiliated corporations, including the loan of funds to, or guarantee of the indebtedness of, an affiliate, is limited.

During the year ended December 31, 2024, the Company repurchased 2,049,739 common shares at an average price of $46.55 per share as part of its share buy-back program approved by the Board of Directors. The program is consistent with the Company's intent to return 35% of annual net income to stockholders through routine share repurchases and common equity dividends, along with incremental capital return as appropriate through additional share repurchases, while maintaining capital ratios in excess of the “well-capitalized” benchmarks.