Regional lender WaFd falls as interest income misses expectation

WaFd

17/01/2025 15:48

** Shares of regional lender WaFd  WAFD.O  fall as much as
6%; last down 2.1% at $30.36
    ** WAFD late Thursday posted Q1 adjusted profit of 54
cents/shr, missing Wall Street expectation of 65 cents/shr,
according to data compiled by LSEG
    ** Q1 net interest income came in at $155.4 mln, far beneath
Wall Street estimates of $171.4 mln 
    ** WAFD says Q1 results were impacted by
greater-than-expected margin compression 
    ** Interest rate cuts resulted in variable rate assets
repricing quickly compared to liabilities such as deposits,
causing margin compression - WAFD
    ** Bank also announced a "significant" shift in focus for
its business model, unveiling plans to exit the single-family
mortgage lending market after over 100 years of making home
loans    
    ** Piper Sandler says WAFD's smaller balance sheet
negatively impacted its interest income, adding that buybacks
had dried up 
    ** Stephens expects WAFD shares to underperform, given the
magnitude of the interest income degradation    
    ** WAFD shares fell 2.2% in 2024

 (Reporting by Arasu Kannagi Basil in Bengaluru)
 ((ArasuKannagi.Basil@thomsonreuters.com;))