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Mar 31, 2020
Waterstone Financial Q1 2020 Earnings Report
Net income increased driven by mortgage banking income growth.
Key Takeaways
Waterstone Financial, Inc. reported a net income of $6.9 million, or $0.27 per diluted share, for the quarter ended March 31, 2020, compared to $6.5 million, or $0.24 per diluted share, for the quarter ended March 31, 2019.
Consolidated net income totaled $6.9 million for the quarter ended March 31, 2020, compared to $6.5 million for the quarter ended March 31, 2019.
Consolidated return on average assets was 1.37% for the quarter ended March 31, 2020 compared to 1.39% for the quarter ended March 31, 2019.
Consolidated return on average equity was 7.07% for the quarter ended March 31, 2020 and 6.65% for the quarter ended March 31, 2019.
Dividends declared totaled $0.62 per share and we repurchased $14.2 million of shares during the quarter ended March 31, 2020 as a result of our strong financial position.
Revenue by Segment
Forward Guidance
The COVID-19 pandemic has caused economic and social disruption on an unprecedented scale, and the company is taking measures to address it.
Positive Outlook
- The CARES Act allows for a temporary delay in the adoption of accounting guidance under Accounting Standards Codification Topic 326.
- Loans less than 30 days past due as of December 31, 2019 will be considered current for COVID-19 modifications.
- The Company is executing a payment deferral program for our lending clients that are adversely affected by the pandemic.
- The CARES Act authorized the Small Business Administration (“SBA”) to temporarily guarantee loans under a new loan program call the Paycheck Protection Program (“PPP”).
- The Company deployed a successful remote working strategy, provided timely communication to team members and customers, implemented protocols for team member safety, and initiated strategies for monitoring and responding to local COVID-19 impacts.
Challenges Ahead
- The COVID-19 pandemic has resulted in significant disruption to the mortgage banking market.
- Increased exposure to early payment defaults on loans sold to investors on the secondary market.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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