WAUWATOSA, Wis., April 23, 2026 (GLOBE NEWSWIRE) -- Waterstone Financial, Inc. $(WSBF)$, holding company for WaterStone Bank, reported net income of $6.0 million, or $0.34 per diluted share, for the quarter ended March 31, 2026, compared to $3.0 million, or $0.17 per diluted share, for the quarter ended March 31, 2025. Net income totaled $7.7 million, or $0.44 per diluted share, for the quarter ended December 31, 2025.
"We started 2026 on a strong note due to continued net interest margin expansion and increased loan origination volumes at the mortgage banking segment," said William Bruss, Chief Executive Officer of Waterstone Financial, Inc. "The community banking segment had a record first quarter net interest income of $15.2 million, which represented a $2.8 million, or 22.8%, increase compared to the quarter ended March 31, 2025, as net interest margin grew to 2.97% for the quarter. The increases were primarily due to continued growth in yield on our loans held for investment and reduction of our cost of funds. We did increase our allowance for credit losses due to certain external qualitative factors even though asset quality metrics continue to stay strong. The mortgage banking segment increased pre-tax income $2.2 million due to an increase in loan origination activity as rates decreased periodically throughout the quarter. We increased our book value per share $0.33 during the quarter with continued strong earnings and the share repurchase program, prior to declaring an increased quarterly dividend of $0.17 per share. In total, $7.3 million was returned to shareholders through buybacks and dividends in the quarter."
Highlights of the Quarter Ended March 31, 2026
Waterstone Financial, Inc. (Consolidated)
-- Consolidated net income of Waterstone Financial, Inc. totaled $6.0
million for the quarter ended March 31, 2026 compared to net income of
$3.0 million for the quarter ended December 31, 2025.
-- Consolidated return on average assets (annualized) was 1.10% for the
quarter ended March 31, 2026 and 0.57% for the quarter ended March 31,
2025.
-- Consolidated return on average equity (annualized) was 6.88% for the
quarter ended March 31, 2026 and 3.61% for the quarter ended March 31,
2025.
-- Dividends declared during the quarter ended March 31, 2026 totaled $0.17
per common share.
-- During the quarter ended March 31, 2026, we repurchased approximately
246,000 shares at a cost (including the federal excise tax) of $4.4
million, or $17.89 per share.
-- Nonperforming assets as a percentage of total assets was 0.35% at March
31, 2026, 0.29% at December 31, 2025, and 0.35% at March 31, 2025.
-- Past due loans as a percentage of total loans was 0.58% at March 31,
2026, 0.86% at December 31, 2025, and 0.67% at March 31, 2025.
-- Book value per share was $19.19 at March 31, 2026 and $19.03 at December
31, 2025.
Community Banking Segment
-- Pre-tax income totaled $7.5 million for the quarter ended March 31, 2026,
which represents a $1.4 million, or 23.7%, increase compared to $6.1
million for the quarter ended March 31, 2025.
-- Net interest income totaled $15.2 million for the quarter ended March 31,
2026, which represents a $2.8 million, or 22.8%, increase compared to
$12.4 million for the quarter ended March 31, 2025.
-- Average loans held for investment totaled $1.68 billion during the
quarter ended March 31, 2026, which represents an increase of $3.8
million, or 0.2%, compared to $1.67 billion for the quarter ended March
31, 2025. The increase was primarily due to increases in multi-family,
construction, and commercial real estate mortgages offset by a decrease
in single-family mortgages. Average loans held for investment decreased
$33.3 million compared to $1.71 billion for the quarter ended December
31, 2025. The decrease was primarily due to a decrease in single-family
real estate mortgages.
-- Net interest margin increased 50 basis points to 2.97% for the quarter
ended March 31, 2026 compared to 2.47% for the quarter ended March 31,
2025, which was primarily driven by an increase in weighted average yield
on loans receivable and held for sale and decreases in the cost of
borrowings and weighted average cost of deposits. Net interest margin
increased eight basis points compared to 2.89% for the quarter ended
December 31, 2025, which was primarily driven by an increase in weighted
average yield on loans receivable and held for sale and decreases in the
cost of borrowings and weighted average cost of deposits.
-- Past due loans at the community banking segment totaled $6.9 million at
March 31, 2026, $10.4 million at December 31, 2025, and $7.6 million at
March 31, 2025.
-- The segment had a provision for credit losses related to funded loans of
$240,000 for the quarter ended March 31, 2026 compared to a negative
provision for credit losses related to funded loans of $314,000 for the
quarter ended March 31, 2025. The current quarter increase was primarily
due to increases in multi-family and construction loan balances along
with an increase in multi-family external qualitative factors. The
provision for credit losses related to unfunded loan commitments was
$44,000 for the quarter ended March 31, 2026 compared to a negative
provision for credit losses related to unfunded loan commitments of
$204,000 for the quarter ended March 31, 2025. The provision for credit
losses related to unfunded loan commitments for the quarter ended March
31, 2026 was due primarily to an increase of the loan pipeline balance at
quarter end.
-- The efficiency ratio, a non-GAAP ratio, was 52.48% for the quarter ended
March 31, 2026, compared to 59.66% for the quarter ended March 31, 2025.
-- Average core retail deposits (excluding brokered and escrow accounts)
totaled $1.33 billion during the quarter ended March 31, 2026, an
increase of $54.8 million, or 4.3%, compared to $1.28 billion during the
quarter ended March 31, 2025 due primarily to increases in money market
and demand deposits balances. Average core retail deposits increased $8.7
million, or 2.6% annualized, compared to $1.32 billion for the quarter
ended December 31, 2025. The segment had an average of $110.2 million in
brokered certificate of deposits during the quarter ended March 31, 2026
compared to $97.1 million during the quarter ended March 31, 2025.
Mortgage Banking Segment
-- Pre-tax income totaled $22,000 for the quarter ended March 31, 2026,
compared to a pre-tax loss of $2.2 million for the quarter ended March
31, 2025.
-- Loan originations increased $120.6 million, or 31.1%, to $508.3 million
during the quarter ended March 31, 2026, compared to $387.7 million
during the quarter ended March 31, 2025. Origination volume relative to
purchase activity accounted for 73.9% of originations for the quarter
ended March 31, 2026 compared to 87.5% of total originations for the
quarter ended March 31, 2025.
-- Mortgage banking non-interest income increased $3.4 million, or 21.5%, to
$19.1 million for the quarter ended March 31, 2026, compared to $15.7
million for the quarter ended March 31, 2025.
-- Gross margin on loans sold totaled 3.65% for the quarter ended March 31,
2026, compared to 3.98% for the quarter ended March 31, 2025.
-- Total compensation, payroll taxes and other employee benefits increased
$2.4 million or 20.1%, to $14.5 million during the quarter ended March
31, 2026 compared to $12.1 million during the quarter ended March 31,
2025. The increase primarily related to increased commission expense,
manager pay expense, production incentive expense, and salary expense.
-- Professional fees decreased $1.2 million, or 88.9%, to $152,000 for the
quarter ended March 31, 2026, compared to $1.4 million for the quarter
ended March 31, 2025. The decrease was primarily related to legal
services and the finalization of a settlement during the three months
ended March 31, 2025.
About Waterstone Financial, Inc.
Waterstone Financial, Inc. is the savings and loan holding company for WaterStone Bank, a community-focused financial institution established in 1921. WaterStone Bank offers a comprehensive suite of personal and business banking products and operates 14 branch locations across southeastern Wisconsin. WaterStone Bank is also the parent company of WaterStone Mortgage Corporation, a national lender licensed in 48 states.
With a long-standing commitment to innovation, integrity, and community service, Waterstone Financial, Inc. supports the financial and homeownership goals of customers nationwide. For more information about WaterStone Bank, go to wsbonline.com.
Forward-Looking Statements
This press release contains statements or information that may constitute forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include, without limitation, statements regarding expected financial and operating activities and results that are preceded by, followed by, or that include words such as "may," "expects," "anticipates," "estimates" or "believes." Any such statements are based upon current expectations that involve a number of risks and uncertainties and are subject to important factors that could cause actual results to differ materially from those anticipated by the forward-looking statements. Factors that might cause such a difference include changes in interest rates; demand for products and services; the degree of competition by traditional and nontraditional competitors; changes in banking regulation or actions by bank regulators; changes in tax laws; the impact of technological advances; governmental and regulatory policy changes; the outcomes of contingencies; trends in customer behavior as well as their ability to repay loans; changes in local real estate values; changes in the national and local economies; and other factors, including risk factors referenced in Item 1A. Risk Factors in Waterstone's most recent Annual Report on Form 10-K and as may be described from time to time in Waterstone's subsequent SEC filings, which factors are incorporated herein by reference. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect only Waterstone's belief as of the date of this press release.
Non-GAAP Financial Measures
Management uses non-GAAP financial information in its analysis of the Company's performance. Management believes that this non-GAAP measure provides a greater understanding of ongoing operations and enhance comparability of results of operations with prior periods. The Company's management believes that investors may use this non-GAAP measure to analyze the Company's financial performance without the impact of unusual items or events that may obscure trends in the Company's underlying performance. This non-GAAP data should be considered in addition to results prepared in accordance with GAAP, and is not a substitute for, or superior to, GAAP results. Limitations associated with non-GAAP financial measures include the risks that persons might disagree as to the appropriateness of items included in this measure and that different companies might calculate this measure differently.
WATERSTONE FINANCIAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
For The Three Months Ended March 31,
2026 2025
(In Thousands, except per share amounts)
Interest income:
Loans $ 25,951 $ 25,078
Mortgage-related
securities 1,454 1,191
Debt securities,
federal funds sold and
short-term
investments 1,610 1,486
Total interest income 29,015 27,755
Interest expense:
Deposits 10,373 11,332
Borrowings 3,179 3,847
Total interest expense 13,552 15,179
Net interest income 15,463 12,576
Provision (credit) for
credit losses 264 (558)
Net interest income
after provision
(credit) for loan
losses 15,199 13,134
Noninterest income:
Service charges on
loans and deposits 374 593
Increase in cash
surrender value of
life insurance 549 481
Mortgage banking income 18,950 15,728
Other 355 295
Total noninterest
income 20,228 17,097
Noninterest expenses:
Compensation, payroll
taxes, and other
employee benefits 19,842 17,047
Occupancy, office
furniture, and
equipment 1,966 1,929
Advertising 617 723
Data processing 1,258 1,212
Communications 258 235
Professional fees 383 1,736
Real estate owned 2 (10)
Loan processing expense 1,029 920
Other 2,520 2,558
Total noninterest
expenses 27,875 26,350
Income before income
taxes 7,552 3,881
Income tax expense 1,555 845
Net income $ 5,997 $ 3,036
Income per share:
Basic $ 0.35 $ 0.17
Diluted $ 0.34 $ 0.17
Weighted average shares
outstanding:
Basic 17,373 18,267
Diluted 17,430 18,280
WATERSTONE FINANCIAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
March 31, December 31,
2026 2025
----------------------- -----------------
(Unaudited)
Assets (In Thousands, except per share amounts)
Cash $ 38,759 $ 63,560
Federal funds sold 5,598 7,255
Interest-earning
deposits in other
financial institutions
and other short term
investments 296 292
---- ----------------- ----------------
Cash and cash
equivalents 44,653 71,107
Securities available
for sale (at fair
value) 237,024 230,848
Loans held for sale (at
fair value) 144,350 145,057
Loans receivable 1,684,312 1,675,552
Less: Allowance for
credit losses ("ACL")
- loans 17,709 17,478
---- ----------------- ----------------
Loans receivable, net 1,666,603 1,658,074
Office properties and
equipment, net 19,273 18,855
Federal Home Loan Bank
stock (at cost) 18,760 19,804
Cash surrender value of
life insurance 77,902 77,353
Real estate owned, net 318 424
Prepaid expenses and
other assets 42,335 37,985
---- ----------------- ----------------
Total assets $ 2,251,218 $ 2,259,507
==== ================= ================
Liabilities and
Shareholders' Equity
Liabilities:
Demand deposits $ 181,758 $ 175,595
Money market and
savings deposits 342,527 329,031
Time deposits 914,502 932,646
---- ----------------- ----------------
Total deposits 1,438,787 1,437,272
Borrowings 413,034 412,258
Advance payments by
borrowers for taxes 11,128 2,996
Other liabilities 40,058 57,589
---- ----------------- ----------------
Total liabilities 1,903,007 1,910,115
Shareholders' equity:
Preferred stock - -
Common stock 182 184
Additional paid-in
capital 74,488 78,014
Retained earnings 296,027 292,957
Unearned ESOP shares (9,199) (9,496)
Accumulated other
comprehensive loss,
net of taxes (13,287) (12,267)
---- ----------------- ----------------
Total shareholders'
equity 348,211 349,392
---- ----------------- ----------------
Total liabilities and
shareholders' equity $ 2,251,218 $ 2,259,507
==== ================= ================
Share Information
Shares outstanding 18,146 18,360
Book value per share $ 19.19 $ 19.03
WATERSTONE FINANCIAL, INC. AND SUBSIDIARIES
SUMMARY OF KEY QUARTERLY FINANCIAL DATA
(Unaudited)
At or For the Three Months Ended
March December September June March
31, 31, 30, 30, 31,
2026 2025 2025 2025 2025
------- --------- ---------- ------- -------
(Dollars in Thousands, except per share amounts)
Condensed
Results of
Operations:
Net interest
income $15,463 $ 15,711 $ 14,739 $13,708 $12,576
Provision
(credit) for
credit
losses 264 (558) (269) (9) (558)
Total
noninterest
income 20,228 21,459 22,302 24,329 17,097
Total
noninterest
expense 27,875 27,677 27,466 28,377 26,350
------ -------- --------- ------ ------
Income before
income taxes 7,552 10,051 9,844 9,669 3,881
Income tax
expense 1,555 2,338 1,918 1,942 845
------ -------- --------- ------ ------
Net income $ 5,997 $ 7,713 $ 7,926 $ 7,727 $ 3,036
====== ======== ========= ====== ======
Income per
share --
basic $ 0.35 $ 0.44 $ 0.45 $ 0.43 $ 0.17
Income per
share --
diluted $ 0.34 $ 0.44 $ 0.45 $ 0.43 $ 0.17
Dividends
declared per
common share $ 0.17 $ 0.15 $ 0.15 $ 0.15 $ 0.15
Performance
Ratios
(annualized):
Return on
average
assets - QTD 1.10% 1.35% 1.42% 1.39% 0.57%
Return on
average
equity - QTD 6.88% 8.74% 9.14% 9.04% 3.61%
Net interest
margin - QTD 2.97% 2.89% 2.76% 2.60% 2.47%
Return on
average
assets - YTD 1.10% 1.19% 1.13% 0.99% 0.57%
Return on
average
equity - YTD 6.88% 7.62% 7.23% 6.32% 3.61%
Net interest
margin - YTD 2.97% 2.68% 2.61% 2.54% 2.47%
Asset Quality
Ratios:
Past due loans
to total
loans 0.58% 0.86% 0.50% 0.69% 0.67%
Nonaccrual
loans to
total loans 0.44% 0.37% 0.35% 0.49% 0.45%
Nonperforming
assets to
total assets 0.35% 0.29% 0.27% 0.37% 0.35%
Allowance for
credit losses
- loans to
loans
receivable 1.05% 1.04% 1.03% 1.07% 1.08%
WATERSTONE FINANCIAL, INC. AND SUBSIDIARIES
SUMMARY OF QUARTERLY AVERAGE BALANCES AND YIELD/COSTS
(Unaudited)
At or For the Three Months Ended
December September
March 31, 31, 30, June 30, March 31,
2026 2025 2025 2025 2025
Average balances (Dollars in Thousands)
Interest-earning
assets
Loans receivable and
held for sale $1,788,736 $1,842,908 $1,809,600 $1,812,065 $1,768,617
Mortgage related
securities 183,980 180,434 178,063 173,220 170,947
Debt securities,
federal funds sold
and short term
investments 137,861 133,781 131,165 131,710 123,004
Total
interest-earning
assets 2,110,577 2,157,123 2,118,828 2,116,995 2,062,568
Noninterest-earning
assets 108,366 107,462 103,434 105,382 105,030
Total assets $2,218,943 $2,264,585 $2,222,262 $2,222,377 $2,167,598
Interest-bearing
liabilities
Demand accounts $ 90,133 $ 92,292 $ 90,015 $ 89,548 $ 87,393
Money market,
savings, and escrow
accounts 343,416 339,368 334,300 320,908 300,686
Certificates of
deposit - retail 817,019 823,586 823,274 830,550 818,612
Certificates of
deposit - brokered 110,192 105,496 61,814 72,533 97,101
Total
interest-bearing
deposits 1,360,760 1,360,742 1,309,403 1,313,539 1,303,792
Borrowings 377,438 419,541 440,968 437,784 397,053
Total
interest-bearing
liabilities 1,738,198 1,780,283 1,750,371 1,751,323 1,700,845
Noninterest-bearing
demand deposits 88,975 89,673 88,799 85,665 80,372
Noninterest-bearing
liabilities 38,073 44,688 39,136 42,669 44,905
Total liabilities 1,865,246 1,914,644 1,878,306 1,879,657 1,826,122
Equity 353,697 349,941 343,956 342,720 341,476
Total liabilities
and equity $2,218,943 $2,264,585 $2,222,262 $2,222,377 $2,167,598
Average Yield/Costs
(annualized)
Loans receivable and
held for sale 5.88% 5.85% 5.84% 5.73% 5.75%
Mortgage related
securities 3.21% 3.09% 3.04% 2.90% 2.83%
Debt securities,
federal funds sold
and short term
investments 4.74% 4.54% 4.74% 4.74% 4.90%
Total
interest-earning
assets 5.58% 5.54% 5.53% 5.43% 5.46%
Demand accounts 0.11% 0.11% 0.11% 0.11% 0.11%
Money market and
savings accounts 2.25% 2.09% 2.04% 2.07% 2.10%
Certificates of
deposit - retail 3.68% 3.78% 3.92% 4.11% 4.33%
Certificates of
deposit - brokered 3.82% 3.89% 4.11% 4.35% 4.18%
Total
interest-bearing
deposits 3.09% 3.12% 3.19% 3.35% 3.52%
Borrowings 3.42% 3.51% 3.86% 3.67% 3.93%
Total
interest-bearing
liabilities 3.16% 3.21% 3.36% 3.43% 3.62%
COMMUNITY BANKING SEGMENT
SUMMARY OF KEY QUARTERLY FINANCIAL DATA
(Unaudited)
At or For the Three Months Ended
March December September June March
31, 31, 30, 30, 31,
2026 2025 2025 2025 2025
(Dollars in Thousands)
Condensed
Results of
Operations:
Net interest
income $15,226 $ 15,521 $ 14,617 $13,640 $12,403
Provision
(credit) for
credit losses 284 (518) (276) (19) (518)
Total
noninterest
income 1,153 1,305 1,359 1,686 1,348
Noninterest
expenses:
Compensation,
payroll taxes,
and other
employee
benefits 5,575 5,646 5,036 5,027 5,212
Occupancy,
office
furniture and
equipment 1,103 1,026 907 920 1,076
Advertising 212 250 213 219 171
Data processing 765 741 733 806 712
Communications 112 103 108 99 100
Professional
fees 228 185 200 196 347
Real estate
owned 2 (298) 4 (8) (10)
Loan processing
expense - - - - -
Other 598 630 617 466 596
Total
noninterest
expense 8,595 8,283 7,818 7,725 8,204
Income before
income taxes 7,500 9,061 8,434 7,620 6,065
Income tax
expense 1,538 2,063 1,518 1,400 1,427
Net income $ 5,962 $ 6,998 $ 6,916 $ 6,220 $ 4,638
Efficiency
ratio - QTD
(non-GAAP) 52.48% 49.23% 48.94% 50.40% 59.66%
Efficiency
ratio - YTD
(non-GAAP) 52.48% 51.76% 52.71% 54.78% 59.66%
MORTGAGE BANKING SEGMENT
SUMMARY OF KEY QUARTERLY FINANCIAL DATA
(Unaudited)
At or For the Three Months Ended
March December September March
31, 31, 30, June 30, 31,
2026 2025 2025 2025 2025
(Dollars in Thousands)
Condensed
Results of
Operations:
Net interest
income $ 214 $ 205 $ 103 $ 53 $ 152
Provision
(credit) for
credit losses (20) (40) 7 10 (40)
Total
noninterest
income 19,121 20,172 20,985 22,643 15,731
Noninterest
expenses:
Compensation,
payroll taxes,
and other
employee
benefits 14,471 15,489 15,716 16,312 12,054
Occupancy,
office
furniture and
equipment 863 798 781 833 853 Advertising 405 446 499 527 552 Data processing 490 465 475 507 498 Communications 146 129 141 158 135 Professional fees 152 33 180 303 1,373 Real estate owned - - - - - Loan processing expense 1,029 571 688 817 920 Other 1,777 1,586 1,271 1,230 1,751 Total noninterest expense 19,333 19,517 19,751 20,687 18,136 Income (loss) before income taxes expense (benefit) 22 900 1,330 1,999 (2,213) Income tax expense (benefit) 10 244 382 531 (588) Net income (loss) $ 12 $ 656 $ 948 $ 1,468 $ (1,625) Efficiency ratio - QTD (non-GAAP) 99.99% 95.78% 93.66% 91.15% 114.18% Efficiency ratio - YTD (non-GAAP) 99.99% 97.56% 98.17% 100.63% 114.18% Loan originations $508,314 $ 534,646 $ 539,404 $588,838 $387,729 Purchase 73.9% 78.9% 90.1% 91.7% 87.5% Refinance 26.1% 21.1% 9.9% 8.3% 12.5% Gross margin on loans sold(1) 3.65% 3.80% 3.87% 3.84% 3.98%
(1) Gross margin on loans sold equals mortgage banking income (excluding the change in interest rate lock value) divided by total loan originations.
Contact:
Mark R. Gerke
Chief Financial Officer
414-459-4012
markgerke@wsbonline.com
(END) Dow Jones Newswires
April 23, 2026 16:01 ET (20:01 GMT)