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Dec 31, 2025
TFS Financial Q1 2026 Earnings Report
TFS Financial reported lower net income in Q1 2026, primarily due to decreased net interest income and increased non-interest expense.
Key Takeaways
TFS Financial posted net income of $22.3 million for Q1 2026, reflecting a modest decline from both the prior quarter and prior year. Despite a decrease in interest margins due to recent Fed rate cuts, net interest income grew YoY, and asset quality remained solid. The company continues to maintain strong capital ratios.
Net income for Q1 2026 was $22.3 million, down from $26.0 million in the prior quarter.
Net interest income reached $75.7 million, up $7.4 million YoY despite recent rate cuts.
Non-interest expense rose 17% YoY to $56.2 million, driven by higher salaries and marketing costs.
Tier 1 leverage ratio stood at 10.75%, indicating strong capital position.
Revenue by Segment
Forward Guidance
The company expects to remain well capitalized and continue to navigate the current interest rate environment, while focusing on attracting deposits and maintaining asset quality.
Positive Outlook
- Maintained capital ratios above regulatory 'well capitalized' thresholds.
- Strong Tier 1 leverage and CET1 ratios.
- Loan growth in home equity portfolios.
- Increased savings account balances offsetting deposit outflows.
- Continued profitability despite margin pressure.
Challenges Ahead
- Net interest income pressured by three Fed rate cuts.
- Rising non-interest expenses, especially marketing and salaries.
- Deposit base declined slightly from prior quarter.
- Decline in investment securities due to maturities.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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