WSFS FINANCIAL CORP Q1 FY2025 earnings call

• WSFS had a solid start to 2025 with improved core metrics. • Core net interest margin expanded, driven by reduced funding costs. • Core fee revenue grew, led by Wealth and Trust, Institutional Services. • Efficiency ratio was 59% due to expense decline from seasonally high levels. • Gross loans and client deposits had specific quarter-over-quarter and year-over-year changes. • Credit costs increased due to a specific non-performing loan, but excluding that, charge-offs were in line. • Capital ratios remained strong with significant regulatory targets exceeded. • Dividends and buybacks were announced, with a 13% increase in quarterly dividend and additional share repurchase authorization.

WSFS had a solid start to 2025. Core earnings per share were $1.13, core ROA was 1.29%, core PPNR was $104.6 million, and core return on tangible common equity was 16.97%. Core net interest margin expanded 8 basis points to 3.88%, with total funding cost reduced 15 basis points. Core fee revenue grew 6% year-over-year, powered by Wealth and Trust (up 19%), Institutional Services, and Bryn Mawr Trust Company of Delaware. Gross loans were down less than 1% linked quarter, commercial loans flat linked quarter. Client deposits declined 1% linked quarter but were up 4% year-over-year. Total net credit costs were $17.6 million, an increase from the previous quarter, with net charge-offs at $24.6 million. Capital ratios remained strong.

• Will provide updated full year outlook after the second quarter. • No immediate guidance update provided in the first quarter. • Net charge-offs excluding a one-time loan were in line with expectations. • Expense run rate was noted to be between the fourth quarter and first quarter levels, with considerations of one-time items and timing factors.

• Macro environment uncertainty impacting loan originations and client investment decisions. • Credit risk from a specific non-performing office-related C&I loan acquired from Bryn Mawr Trust, though other portfolios were behaving as expected. • Volatility in the macroeconomic environment affecting client behavior and business decisions.

Q: Russell Gunther asked about the lack of updated guidance and net charge offs.

A: David Burg stated they typically update guidance after the second quarter, and excluding a one-time loan, net charge-offs were in line with expectations.

Q: Frank Schiraldi inquired about commercial growth and expenses.

A: Rodger Levenson mentioned customers were cautious due to macro volatility, and David Burg discussed expense components like Cash Connect and incentive accruals.

Q: Manuel Navas asked about deposit betas and the 12% CET1 target.

A: David Burg said deposit betas exceeded expectations, and the 12% CET1 target is a two to three year glide path.

Q: Kelly Motta asked about loan portfolio impact from tariffs and net growth.

A: Rodger Levenson said they were monitoring but no changes to underwriting yet, and net growth would require greater certainty on policy matters.