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Jun 30, 2020
TFS Financial Q3 2020 Earnings Report
TFS Financial Corporation reported net income, driven by higher net gain on the sale of loans, lower non-interest expense, and a lower effective tax rate, which was partially offset by lower net interest income and an increase in the provision for loan losses.
Key Takeaways
TFS Financial Corporation announced results for the three months ended June 30, 2020, reporting a net income of $26.8 million, compared to $18.3 million for the same period in 2019. The increase was primarily due to higher net gain on the sale of loans, lower non-interest expense, and a lower effective tax rate, partially offset by lower net interest income and an increase in the provision for loan losses. Loan originations reached the highest number in a single quarter in 15 years, with over $1.2 billion in first and second mortgage loans originated.
Net income increased to $26.8 million for the quarter ended June 30, 2020, compared to $18.3 million for the quarter ended June 30, 2019.
Non-interest expense ratio hit the lowest since the company went public in 2007, at 1.20%.
Over $1.2 billion in first and second mortgage loans were originated, marking the highest number of originations in a single quarter in 15 years.
Total assets increased by $292.4 million, or 2.01%, to $14.83 billion at June 30, 2020, from $14.54 billion at September 30, 2019.
Forward Guidance
This report contains forward-looking statements which 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
Positive Outlook
- 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 loan losses and charge-offs
- statements regarding the trends in factors affecting our financial condition and results of operations, including asset quality of our loan and investment portfolios
- estimates of our risks and future costs and benefits
Challenges Ahead
- significantly increased competition among depository and other financial institutions
- inflation and changes in the interest rate environment that reduce our interest margins or reduce the fair value of financial instruments
- general economic conditions, either globally, nationally or in our market areas, including employment prospects, real estate values and conditions that are worse than expected
Historical Earnings Impact
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Avg. Return Before/After Earnings
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