Waterstone Financial, Inc. Announces Results of Operations for the Three Months Ended March 31, 2026

Rhea-AI Summary

Waterstone Financial (NASDAQ: WSBF) reported consolidated net income of $6.0 million ($0.34 diluted EPS) for Q1 2026, up from $3.0 million ($0.17) in Q1 2025. ROAA was 1.10% and ROAE 6.88%. Book value per share rose to $19.19. The company returned $7.3 million to shareholders via buybacks and dividends and declared a quarterly dividend of $0.17.

Community banking NII was $15.2 million and NIM expanded to 2.97%. Mortgage banking originations rose to $508.3 million and pre-tax income improved to a profit.

Positive

• Net income +$3.0M vs Q1 2025
• EPS of $0.34 for Q1 2026
• Net interest income $15.2M (community banking)
• Net interest margin 2.97%
• Mortgage originations $508.3M (+31.1%)
• Returned $7.3M to shareholders

Negative

• Allowance for credit losses increased (external qualitative factors)
• Mortgage banking gross margin fell to 3.65%
• Total compensation expense +20.1% (+$2.4M)
• Nonperforming assets 0.35% of assets

News Market Reaction – WSBF

-0.33%

-0.33% Session close to close

In the Apr 24 session, WSBF declined 0.33%, reflecting a mild negative market reaction.

Data tracked by StockTitan Argus on the day of publication.

Market Context

This announcement details a strong Q1 2026, with net income and diluted EPS up year over year, a hig...

Analysis

This announcement details a strong Q1 2026, with net income and diluted EPS up year over year, a higher 2.97% net interest margin, and record community banking net interest income. Mortgage banking swung from a prior loss to a small pre‑tax profit on higher originations. Management continued returning capital via buybacks and a higher $0.17 dividend. In context of prior quarters with rising margins and earnings, investors may watch future asset quality trends, credit loss provisions, and origination volumes.

Key Figures

Q1 2026 net income: $6.0 million Q1 2026 diluted EPS: $0.34 per share Community bank NII: $15.2 million +5 more

8 metrics

Q1 2026 net income $6.0 million Quarter ended March 31, 2026

Q1 2026 diluted EPS $0.34 per share Quarter ended March 31, 2026

Community bank NII $15.2 million Community banking net interest income, Q1 2026

Net interest margin 2.97% Consolidated NIM for quarter ended March 31, 2026

Dividend per share $0.17 Dividend declared during quarter ended March 31, 2026

Share repurchases 246,000 shares for $4.4 million Quarter ended March 31, 2026, at $17.89 per share

Nonperforming assets ratio 0.35% Nonperforming assets as % of total assets at March 31, 2026

Mortgage originations $508.3 million Mortgage banking loan originations, Q1 2026

Historical Context

4 past events · Latest: Mar 17 (Positive)

Pattern 4 events

Date	Event	Sentiment	24h Move	Catalyst
Mar 17	Dividend increase	Positive	-0.6%	Raised regular quarterly dividend to $0.17 per share, up 13.3%.
Jan 28	Earnings release	Positive	+8.3%	Reported Q4 2025 net income $7.7M, EPS $0.44, higher NIM and buybacks.
Dec 18	Dividend declaration	Neutral	-2.8%	Declared regular quarterly cash dividend of $0.15 per share.
Oct 23	Earnings release	Positive	+3.4%	Q3 2025 earnings showed higher EPS, stronger NIM, and share repurchases.

24h Move is the share-price change in the day after each event; other market factors may also have contributed.

Pattern Detected

Earnings releases have historically seen positive price alignment, while dividend announcements have coincided with modest negative reactions.

Recent Company History

Recent WSBF news centered on earnings strength and shareholder returns. Q3 and Q4 2025 results showed rising net income, EPS, and net interest margin, with buybacks and dividends supporting book value growth. Dividend announcements on Dec 18, 2025 and the Mar 17, 2026 dividend increase to $0.17 per share both saw small next‑day declines. Today’s Q1 2026 results extend this trajectory, with higher net income, improved margins, and continued capital return via repurchases and a higher dividend.

Key Terms

net interest margin, allowance for credit losses, nonperforming assets, efficiency ratio, +4 more

8 terms

net interest margin financial

"The community banking segment had a record first quarter net interest income... as net interest margin grew to 2.97% for the quarter."

Net interest margin measures how much a bank earns from lending and investing compared with what it pays for funding, expressed as a percentage of its interest-earning assets. Think of it like a grocery store’s markup: it shows the gap between buying cost and selling price per dollar of goods — here, the cost is interest paid and the sale is interest received. Investors watch it because a higher margin usually means a bank is more profitable and better at managing interest rate and credit conditions.

allowance for credit losses financial

"We did increase our allowance for credit losses due to certain external qualitative factors..."

Allowance for credit losses is a reserve set aside by a financial institution to cover potential losses from borrowers who may not repay their loans. It acts like a safety net, helping the institution prepare for loans that might turn sour. For investors, it signals how cautious the institution is about the quality of its loans and potential risks to its financial health.

nonperforming assets financial

"Nonperforming assets as a percentage of total assets was 0.35% at March 31, 2026..."

Nonperforming assets are loans or investments that are not generating expected payments or returns because the borrower has fallen behind on payments or the investment has lost value. They matter to investors because a high level of nonperforming assets can indicate financial trouble for a bank or institution, potentially affecting its stability and profitability.

efficiency ratio financial

"The efficiency ratio, a non-GAAP ratio, was 52.48% for the quarter ended March 31, 2026..."

A measure of how much a company spends to produce each dollar of revenue, usually shown as operating expenses divided by revenue and expressed as a percentage. Think of it as a household’s budget: a lower percentage means more of each dollar earned stays as profit, while a higher number means costs are eating into returns. Investors use it to judge cost control and compare how efficiently companies turn revenue into earnings, especially in banks and financial firms.

brokered certificate of deposits financial

"The segment had an average of $110.2 million in brokered certificate of deposits..."

A brokered certificate of deposit is a time‑deposit account sold through a brokerage firm rather than directly from a bank; it pays a fixed interest rate for a set term but can be bought or sold through the broker before the term ends. Think of it like buying a fixed‑rate IOU from a bank at a marketplace — it can offer higher yields or convenience, but resale prices can fluctuate and FDIC protection depends on the issuing bank and the insured amount, so investors should weigh yield, liquidity, and safety.

provision for credit losses financial

"The segment had a provision for credit losses related to funded loans of $240,000..."

Provision for credit losses is an amount set aside by a financial institution to cover potential future losses from borrowers who may not repay their loans. It acts like a safety net, helping the institution manage risks and stay financially healthy. For investors, it signals how cautious a lender is about potential loan defaults and can impact the company's profitability and financial stability.

gross margin on loans sold financial

"Gross margin on loans sold totaled 3.65% for the quarter ended March 31, 2026..."

Gross margin on loans sold measures the percentage difference between the money a lender receives when it sells loans and the lender’s cost to originate or carry those loans. Think of it like a store’s markup: it shows how much the seller keeps after accounting for the loan’s cost. Investors watch it because a higher margin signals healthier profitability, better pricing power and lower likelihood of surprise losses when loans are packaged and sold.

pre-tax income financial

"Pre-tax income totaled $7.5 million for the quarter ended March 31, 2026..."

Pre-tax income is the amount a company earns after subtracting all costs and expenses but before paying income taxes. Think of it like your paycheck before tax withholding: it shows the business’s underlying profit power without the distorting effect of different tax rates or one-time tax events. Investors use it to compare operating performance across companies and to gauge profitability and trends before tax policy or timing alters the bottom line.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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WAUWATOSA, Wis., April 23, 2026 (GLOBE NEWSWIRE) -- Waterstone Financial, Inc. (NASDAQ: 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 31,				December 31,				September 30,				June 30,				March 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
	March 31,				December 31,				September 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 31,				December 31,				September 30,				June 30,				March 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 31,				December 31,				September 30,				June 30,				March 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

FAQ

What did Waterstone Financial (WSBF) report for Q1 2026 net income and EPS?

Net income was $6.0 million, or $0.34 per diluted share. According to Waterstone Financial, consolidated net income improved from $3.0 million ($0.17 per diluted share) in Q1 2025, driven by NIM expansion and higher mortgage originations.

How did Waterstone Financial's net interest margin and community banking performance look in Q1 2026?

NIM expanded to 2.97% and community banking NII was $15.2 million. According to Waterstone Financial, NIM rose 50 basis points year-over-year, supporting a 22.8% increase in community banking net interest income versus Q1 2025.

What were Waterstone Financial's mortgage banking originations and profitability in Q1 2026?

Loan originations were $508.3 million and mortgage pre-tax income turned positive. According to Waterstone Financial, originations rose 31.1% year-over-year and mortgage banking moved to pre-tax income of $22,000 versus a loss in Q1 2025.

How much did Waterstone Financial return to shareholders in Q1 2026 and what dividend was declared?

The company returned $7.3 million via buybacks and dividends and declared a $0.17 quarterly dividend. According to Waterstone Financial, repurchases totaled about 246,000 shares at $17.89 per share during the quarter.

Did Waterstone Financial change its allowance for credit losses in Q1 2026?

The allowance for credit losses was increased due to external qualitative factors. According to Waterstone Financial, asset quality metrics remained strong despite the increase, and funded/unfunded loan provision adjustments reflected higher multi-family and construction balances.

What key expense or margin pressures should WSBF investors note from Q1 2026?

Compensation expense rose 20.1% and mortgage gross margin eased to 3.65%. According to Waterstone Financial, total compensation increased by $2.4 million, driven by commissions and incentives, while loan sale gross margin declined versus prior year.