- Capitol Federal Financial, Inc. (CFFN, Financial) reported net income of $15.4 million for Q2 of fiscal year 2025.
- Basic and diluted earnings per share were $0.12, with a net interest margin increase to 1.92%.
- A dividend of $0.085 per share was announced, payable on May 16, 2025.
Capitol Federal Financial, Inc. (CFFN), parent company of Capitol Federal Savings Bank, disclosed its financial results for the quarter ending March 31, 2025. The company maintained stable net income of $15.4 million or $0.12 per share, consistent with the previous quarter.
The net interest margin experienced a rise, reaching 1.92%, a six basis point increase from the prior quarter, largely driven by a reduction in deposit costs. Despite a growth in net interest income after provisions for credit losses, higher non-interest expenses offset these gains.
Interest and dividend income totaled $98.2 million, showing a moderate increase from $97.6 million in the previous quarter. This was mainly attributed to a higher income from mortgage-backed securities and cash equivalents, despite a decrease in income from loans receivable.
The company's interest expense on deposits decreased by 4.0% to $35.9 million. This decline was mostly due to lower rates on retail certificates of deposit and money market accounts. Meanwhile, borrowings interest expense rose slightly due to higher average rates.
The provision for credit losses remained neutral for this quarter as a decrease in the allowance for credit losses was balanced by a rise in reserves for off-balance sheet credit exposures.
Non-interest income improved by 5.5% to $5.0 million, driven by an increase in insurance commissions and other non-interest income. However, non-interest expenses increased significantly by 8.8%, totaling $29.5 million, attributed to rising salaries, IT expenses, and regulatory service costs.
A cash dividend of $0.085 per share was announced, set to be distributed on May 16, 2025, to shareholders recorded by May 2, 2025. Looking forward, the company anticipates further improvements in its net interest margin and continues its strategic shift towards enhancing its commercial loan portfolio.
