CUBI Customers Bancorp Inc

Customers Bancorp, Inc. (NYSE:CUBI):

Fourth Quarter 2024 Highlights

• Q4 2024 net income available to common shareholders was $23.3 million, or $0.71 per diluted share; ROAA was 0.48% and ROCE was 5.50%.
• Q4 2024 core earnings*1 were $44.2 million, or $1.36 per diluted share; Core ROAA* was 0.86% and Core ROCE* was 10.44%.
• Q4 2024 net income available to common shareholders included $20.0 million of post-tax losses in connection with the securities portfolio repositioning executed to improve structural liquidity, reduce asset sensitivity and benefit margin.
• Total loans and leases held for investment grew by $671.1 million in Q4 2024 from Q3 2024 or 19% annualized.
• Total deposits increased by $777.1 million or 4.3% in Q4 2024 from Q3 2024.
• Non-interest bearing demand deposits increased $937.5 million or 20.1% in Q4 2024 from Q3 2024; non-interest bearing deposits represented 29.7% of total deposits at December 31, 2024.
• Q4 2024 average cost of deposits was 3.07% compared to Q3 2024 of 3.46%, a decrease of 39 basis points.
• Q4 2024 net interest margin, tax equivalent (“NIM”) was 3.11%, compared to Q3 2024 NIM of 3.06%, an increase of 5 basis points primarily due to lower deposit costs.
• Ratio of non-performing assets to total assets was 0.25% at December 31, 2024 compared to 0.22% at September 30, 2024.
• Q4 2024 provision for credit losses on loans and leases was $18.2 million compared to $17.8 million in Q3 2024 and the allowance for credit losses on loans and leases equaled 316% of non-performing loans at December 31, 2024, compared to 281% at September 30, 2024.
• CET 1 ratio of 12.0%2 at December 31, 2024, compared to 12.5% at September 30, 2024.
• TCE / TA ratio* of 7.6% at December 31, 2024, compared to 7.7% at September 30, 2024.
• Q4 2024 book value per share and tangible book value per share* both grew by approximately $1.12, or 2.1% over Q3 2024, or 8.4% annualized, with a tangible book value per share* of $54.08 at December 31, 2024. This was driven by current quarter earnings and a decrease in AOCI losses of $9.5 million.

 

 

 

 

 

 

*

 

Non-GAAP measure. Customers’ reasons for the use of the non-GAAP measure and a detailed reconciliation between the non-GAAP measure and the comparable GAAP amount are included at the end of this document.

1

 

Excludes pre-tax losses on investment securities of $26.7 million, severance expense of $1.6 million, derivative credit valuation adjustment of $0.4 million, unrealized gain on equity method investments of $0.4 million, legal settlement of $0.2 million and unrealized losses on loans held for sale of $0.1 million.

2

 

Regulatory capital ratios as of December 31, 2024 are estimates.

Full Year 2024 Highlights

• 2024 net income available to common shareholders was $166.4 million, or $5.09 per diluted share; ROAA was 0.85% and ROCE was 10.36%.
• 2024 core earnings* were $183.1 million, or $5.60 per diluted share; Core ROAA* was 0.92% and Core ROCE* was 11.40%.
• Total loans and leases held for investment grew by $1.6 billion or 12.3% from December 31, 2023 to December 31, 2024.
• Total deposits increased by $926.2 million or 5.2%, from December 31, 2023 to December 31, 2024.
• Non-interest bearing demand deposits increased $1.2 billion, or 26.8%, from December 31, 2023 to December 31, 2024.
• 2024 NIM was 3.15% compared to 2023 NIM of 3.29%.
• Ratio of non-performing assets to total assets was 0.25% at December 31, 2024 compared to 0.13% at December 31, 2023.
• Allowance for credit losses on loans and leases equaled 316% of non-performing loans at December 31, 2024, compared to 499% at December 31, 2023.
• CET 1 capital ratio of 12.0%1 at December 31, 2024, compared to 12.2% at December 31, 2023.
• TCE / TA ratio* of 7.6% at December 31, 2024, compared to 7.0% at December 31, 2023.
• Book value per share and tangible book value per share* grew year over year by approximately $6.47 or 13.6%, driven by strong 2024 annual earnings combined with the decreased AOCI losses of $40.0 million over the same time period. Tangible book value per share* has grown at a 16% compound annual growth rate (CAGR) over the past 5 years, significantly higher than the regional bank peer median2 of 4%.
• Repurchased 393,303 common shares below book value at a weighted-average price of $48.36 for $19.2 million in 2024.

 

 

 

 

 

 

*

 

Non-GAAP measure. Customers’ reasons for the use of the non-GAAP measure and a detailed reconciliation between the non-GAAP measure and the comparable GAAP amount is included at the end of this document.

1

 

Regulatory capital ratios as of December 31, 2024 are estimates.

2

 

Regional bank peers based on selected 2024 proxy peers with a reporting date on or before January 22, 2025.

CEO Commentary

“We are pleased to share our fourth quarter and full year 2024 results that highlight the company’s continuing incredible deposit transformation and underscore our success in growing franchise value in a competitive market environment. Exceptional client service is the cornerstone of our culture and business model, and is so important it is in our name. To measure customer satisfaction, we recently participated in an annual Net Promoter Score survey, also known as NPS. Our most recent score of 73 is well above the U.S. banking industry average of 411 and is above the scores of many other service-oriented brands across all industries. We are delighted by the positive response from our customers and the trust they place in us. This is a testament to our customer-centric mindset and commitment to service provided by our extraordinary colleagues,” said Customers Bancorp Chairman and CEO Jay Sidhu.

“In the fourth quarter, we once again brought in over $1 billion of gross deposit inflows which we utilized in part to paydown higher-cost and brokered deposits. Non-interest bearing deposits increased by $937.5 million and represented 29.7% of total deposits at December 31, 2024. These efforts, along with proactive management of the cost of our existing deposit portfolio, resulted in a 39 basis point reduction in our cost of deposits during the quarter.

“Our deposit pipelines continue to expand with a significant conversion ratio. In addition, deposit focused teams we have recruited since March 2023 managed $1.7 billion or 9% of total deposits. Enhanced by their efforts, we’ve increased commercial deposit accounts by 48% over the past two years, adding granular and sticky relationships while significantly lowering our cost of deposits, increasing our non-interest bearing deposits, and driving franchise value. During the quarter, we opportunistically repositioned a portion of the securities portfolio to improve structural liquidity, reduce asset sensitivity and benefit margin. Even with the repositioning transaction and balance sheet growth we experienced during the quarter, our TCE / TA ratio* remained roughly flat. 2024 was a year in which we made significant investments in our future. We believe the company is extremely well-positioned to continue to strengthen our deposit franchise, improve our profitability, and maintain our already strong capital ratios,” stated Jay Sidhu.

“Our Q4 2024 GAAP earnings were $23.3 million, or $0.71 per diluted share, and core earnings* were $44.2 million, or $1.36 per diluted share. Fourth quarter GAAP results include losses in connection the accretive securities portfolio repositioning. We maintain a strong liquidity position, with $9.1 billion of liquidity immediately available, which covers approximately 159% of uninsured deposits2 and our loan to deposit ratio was 78%, at December 31, 2024. We continue to focus on loan production where we have a holistic and primary relationship. Total loans and leases held for investment grew by $671.1 million which represent a 19% annualized growth rate, driven by strong commercial loan growth of $683.1 million led by growth in our existing specialized lending verticals. In 2024, total loans and leases held for investment grew by $1.6 billion which represent a 12.3% growth rate. Asset quality remains strong with our NPA ratio at just 0.25% of total assets and reserve levels are robust at 316% of total non-performing loans at the end of Q4 2024. Total net charge-offs declined by $2.4 million. Our exposure to the higher risk commercial real estate office sector is minimal, representing approximately 1% of the loan portfolio. We will remain disciplined, but opportunistic, with our balance sheet capacity to manage risk and maintain robust capital levels. Tangible Book Value per share* grew to $54.08. We believe that our unique strategy and the investments we have and are making, along with the exceptional talent in our organization, will position us for success in 2025 and beyond. We are extremely excited about the future of this company especially in what we expect to be a more favorable banking environment,” Jay Sidhu continued.

 

 

 

 

 

 

*

 

Non-GAAP measure. Customers’ reasons for the use of the non-GAAP measure and a detailed reconciliation between the non-GAAP measure and the comparable GAAP amount are included at the end of this document.

1

 

The Qualtrics U.S. Banking Relational Net Promoter® Score (NPS®) benchmark is derived from Qualtrics' vast Customer Experience dataset. The dataset includes 2022-2023 anonymized results from 50+ U.S. banking organizations, covering 80+ separate relationship surveys, and encompassing 400,000 individual survey respondents.

2

 

Uninsured deposits (estimate) of $7.3 billion to be reported on the Bank’s call report, less deposits of $1.5 billion collateralized by standby letters of credit from the FHLB and from our affiliates of $176.2 million.

Financial Highlights

 

At or Three Months Ended

 

 

(Dollars in thousands, except per share data)

 

December 31, 2024

 

September 30, 2024

 

Increase (Decrease)

Profitability Metrics:

 

 

 

 

 

 

 

 

Net income available for common shareholders

 

$

23,266

 

 

$

42,937

 

 

$

(19,671

)

 

(45.8

)%

Diluted earnings per share

 

$

0.71

 

 

$

1.31

 

 

$

(0.60

)

 

(45.8

)%

Core earnings*

 

$

44,168

 

 

$

43,838

 

 

$

330

 

 

0.8

%

Adjusted core earnings*

 

$

44,168

 

 

$

41,381

 

 

$

2,787

 

 

6.7

%

Core earnings per share*

 

$

1.36

 

 

$

1.34

 

 

$

0.02

 

 

1.5

%

Adjusted core earnings per share*

 

$

1.36

 

 

$

1.26

 

 

$

0.10

 

 

7.9

%

Return on average assets (“ROAA”)

 

 

0.48

%

 

 

0.88

%

 

 

(0.40

)

 

 

Core ROAA*

 

 

0.86

%

 

 

0.89

%

 

 

(0.03

)

 

 

Adjusted core ROAA*

 

 

0.86

%

 

 

0.85

%

 

 

0.01

 

 

 

Return on average common equity (“ROCE”)

 

 

5.50

%

 

 

10.44

%

 

 

(4.94

)

 

 

Core ROCE*

 

 

10.44

%

 

 

10.66

%

 

 

(0.22

)

 

 

Adjusted core ROCE*

 

 

10.44

%

 

 

10.06

%

 

 

0.38

 

 

 

Core pre-tax pre-provision net income*

 

$

84,224

 

 

$

64,824

 

 

$

19,400

 

 

29.9

%

Adjusted core pre-tax pre-provision net income*

 

$

84,224

 

 

$

61,827

 

 

$

22,397

 

 

36.2

%

Net interest margin, tax equivalent

 

 

3.11

%

 

 

3.06

%

 

 

0.05

 

 

 

Yield on loans (Loan yield)

 

 

6.78

%

 

 

6.99

%

 

 

(0.21

)

 

 

Cost of deposits

 

 

3.07

%

 

 

3.46

%

 

 

(0.39

)

 

 

Efficiency ratio

 

 

56.86

%

 

 

62.40

%

 

 

(5.54

)

 

 

Core efficiency ratio*

 

 

56.12

%

 

 

61.69

%

 

 

(5.57

)

 

 

Adjusted core efficiency ratio*

 

 

56.12

%

 

 

63.48

%

 

 

(7.36

)

 

 

Non-interest expense to average total assets

 

 

1.98

%

 

 

1.95

%

 

 

0.03

 

 

 

Core non-interest expense to average total assets*

 

 

1.95

%

 

 

1.94

%

 

 

0.01

 

 

 

Adjusted core non-interest expense to average total assets*

 

 

1.95

%

 

 

1.99

%

 

 

(0.04

)

 

 

Balance Sheet Trends:

 

 

 

 

 

 

 

 

Total assets

 

$

22,308,241

 

 

$

21,456,082

 

 

$

852,159

 

 

4.0

%

Total cash and investment securities

 

$

6,797,562

 

 

$

6,564,528

 

 

$

233,034

 

 

3.5

%

Total loans and leases

 

$

14,653,556

 

 

$

14,053,116

 

 

$

600,440

 

 

4.3

%

Non-interest bearing demand deposits

 

$

5,608,288

 

 

$

4,670,809

 

 

$

937,479

 

 

20.1

%

Total deposits

 

$

18,846,461

 

 

$

18,069,389

 

 

$

777,072

 

 

4.3

%

Capital Metrics:

 

 

 

 

 

 

 

 

Common Equity

 

$

1,698,889

 

 

$

1,663,386

 

 

$

35,503

 

 

2.1

%

Tangible Common Equity*

 

$

1,695,260

 

 

$

1,659,757

 

 

$

35,503

 

 

2.1

%

Common Equity to Total Assets

 

 

7.6

%

 

 

7.8

%

 

 

(0.2

)

 

 

Tangible Common Equity to Tangible Assets*

 

 

7.6

%

 

 

7.7

%

 

 

(0.1

)

 

 

Book Value per common share

 

$

54.20

 

 

$

53.07

 

 

$

1.13

 

 

2.1

%

Tangible Book Value per common share*

 

$

54.08

 

 

$

52.96

 

 

$

1.12

 

 

2.1

%

Common equity Tier 1 capital ratio (1)

 

 

12.0

%

 

 

12.5

%

 

 

(0.5

)

 

 

Total risk based capital ratio (1)

 

 

14.8

%

 

 

15.4

%

 

 

(0.6

)

 

 

 

 

 

 

 

 

 

 

 

(1) Regulatory capital ratios as of December 31, 2024 are estimates.

* Non-GAAP measure. Customers’ reasons for the use of the non-GAAP measure and a detailed reconciliation between the non-GAAP measure and the comparable GAAP amount are included at the end of this document.

Financial Highlights

 

At or Three Months Ended

 

 

 

Twelve Months Ended

 

 

(Dollars in thousands, except per share data)

 

December 31, 2024

 

December 31, 2023

 

Increase (Decrease)

 

December 31, 2024

 

December 31, 2023

 

Increase (Decrease)

Profitability Metrics:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income available for common shareholders

 

$

23,266

 

 

$

58,223

 

 

$

(34,957

)

 

(60.0

)%

 

$

166,429

 

 

$

235,448

 

 

$

(69,019

)

 

(29.3

)%

Diluted earnings per share

 

$

0.71

 

 

$

1.79

 

 

$

(1.08

)

 

(60.3

)%

 

$

5.09

 

 

$

7.32

 

 

$

(2.23

)

 

(30.5

)%

Core earnings*

 

$

44,168

 

 

$

61,633

 

 

$

(17,465

)

 

(28.3

)%

 

$

183,105

 

 

$

248,233

 

 

$

(65,128

)

 

(26.2

)%

Adjusted core earnings*

 

$

44,168

 

 

$

61,633

 

 

$

(17,465

)

 

(28.3

)%

 

$

189,253

 

 

$

248,233

 

 

$

(58,980

)

 

(23.8

)%

Core earnings per share*

 

$

1.36

 

 

$

1.90

 

 

$

(0.54

)

 

(28.4

)%

 

$

5.60

 

 

$

7.72

 

 

$

(2.12

)

 

(27.5

)%

Adjusted core earnings per share*

 

$

1.36

 

 

$

1.90

 

 

$

(0.54

)

 

(28.4

)%

 

$

5.78

 

 

$

7.72

 

 

$

(1.94

)

 

(25.1

)%

Return on average assets (“ROAA”)

 

 

0.48

%

 

 

1.16

%

 

 

(0.68

)

 

 

 

 

0.85

%

 

 

1.16

%

 

 

(0.31

)

 

 

Core ROAA*

 

 

0.86

%

 

 

1.22

%

 

 

(0.36

)

 

 

 

 

0.92

%

 

 

1.22

%

 

 

(0.30

)

 

 

Adjusted core ROAA*

 

 

0.86

%

 

 

1.22

%

 

 

(0.36

)

 

 

 

 

0.95

%

 

 

1.22

%

 

 

(0.27

)

 

 

Return on average common equity (“ROCE”)

 

 

5.50

%

 

 

15.93

%

 

 

(10.43

)

 

 

 

 

10.36

%

 

 

17.33

%

 

 

(6.97

)

 

 

Core ROCE*

 

 

10.44

%

 

 

16.87

%

 

 

(6.43

)

 

 

 

 

11.40

%

 

 

18.27

%

 

 

(6.87

)

 

 

Adjusted core ROCE*

 

 

10.44

%

 

 

16.87

%

 

 

(6.43

)

 

 

 

 

11.78

%

 

 

18.27

%

 

 

(6.49

)

 

 

Core pre-tax pre-provision net income*

 

$

84,224

 

 

$

101,884

 

 

$

(17,660

)

 

(17.3

)%

 

$

321,942

 

 

$

416,563

 

 

$

(94,621

)

 

(22.7

)%

Adjusted core pre-tax pre-provision net income*

 

$

84,224

 

 

$

101,884

 

 

$

(17,660

)

 

(17.3

)%

 

$

330,259

 

 

$

416,563

 

 

$

(86,304

)

 

(20.7

)%

Net interest margin, tax equivalent

 

 

3.11

%

 

 

3.31

%

 

 

(0.20

)

 

 

 

 

3.15

%

 

 

3.29

%

 

 

(0.14

)

 

 

Yield on loans (Loan yield)

 

 

6.78

%

 

 

7.30

%

 

 

(0.52

)

 

 

 

 

6.99

%

 

 

7.16

%

 

 

(0.17

)

 

 

Cost of deposits

 

 

3.07

%

 

 

3.39

%

 

 

(0.32

)

 

 

 

 

3.34

%

 

 

3.27

%

 

 

0.07

 

 

 

Efficiency ratio

 

 

56.86

%

 

 

49.08

%

 

 

7.78

 

 

 

 

 

56.21

%

 

 

46.49

%

 

 

9.72

 

 

 

Core efficiency ratio*

 

 

56.12

%

 

 

46.70

%

 

 

9.42

 

 

 

 

 

56.25

%

 

 

45.45

%

 

 

10.80

 

 

 

Adjusted core efficiency ratio*

 

 

56.12

%

 

 

46.70

%

 

 

9.42

 

 

 

 

 

55.11

%

 

 

45.45

%

 

 

9.66

 

 

 

Non-interest expense to average total assets

 

 

1.98

%

 

 

1.75

%

 

 

0.23

 

 

 

 

 

1.95

%

 

 

1.64

%

 

 

0.31

 

 

 

Core non-interest expense to average total assets*

 

 

1.95

%

 

 

1.67

%

 

 

0.28

 

 

 

 

 

1.92

%

 

 

1.62

%

 

 

0.30

 

 

 

Adjusted core non-interest expense to average total assets*

 

 

1.95

%

 

 

1.67

%

 

 

0.28

 

 

 

 

 

1.88

%

 

 

1.62

%

 

 

0.26

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Regulatory capital ratios as of December 31, 2024 are estimates.

* Non-GAAP measure. Customers’ reasons for the use of the non-GAAP measure and a detailed reconciliation between the non-GAAP measure and the comparable GAAP amount are included at the end of this document.

Financial Highlights

 

At or Three Months Ended

 

 

(Dollars in thousands, except per share data)  

December 31, 2024

 

December 31, 2023

 

Increase (Decrease)

Balance Sheet Trends:

 

 

 

 

 

 

 

 

Total assets

 

$

22,308,241

 

 

$

21,316,265

 

 

$

991,976

 

 

4.7

%

Total cash and investment securities

 

$

6,797,562

 

 

$

7,355,156

 

 

$

(557,594

)

 

(7.6

)%

Total loans and leases

 

$

14,653,556

 

 

$

13,202,084

 

 

$

1,451,472

 

 

11.0

%

Non-interest bearing demand deposits

 

$

5,608,288

 

 

$

4,422,494

 

 

$

1,185,794

 

 

26.8

%

Total deposits

 

$

18,846,461

 

 

$

17,920,236

 

 

$

926,225

 

 

5.2

%

Capital Metrics:

 

 

 

 

 

 

 

 

Common Equity

 

$

1,698,889

 

 

$

1,500,600

 

 

$

198,289

 

 

13.2

%

Tangible Common Equity*

 

$

1,695,260

 

 

$

1,496,971

 

 

$

198,289

 

 

13.2

%

Common Equity to Total Assets

 

 

7.6

%

 

 

7.0

%

 

 

0.6

 

 

 

Tangible Common Equity to Tangible Assets*

 

 

7.6

%

 

 

7.0

%

 

 

0.6

 

 

 

Book Value per common share

 

$

54.20

 

 

$

47.73

 

 

$

6.47

 

 

13.6

%

Tangible Book Value per common share*

 

$

54.08

 

 

$

47.61

 

 

$

6.47

 

 

13.6

%

Common equity Tier 1 capital ratio (1)

 

 

12.0

%

 

 

12.2

%

 

 

(0.2

)

 

 

Total risk based capital ratio (1)

 

 

14.8

%

 

 

15.3

%

 

 

(0.5

)

 

 

 

 

 

 

 

 

 

 

 

(1) Regulatory capital ratios as of December 31, 2024 are estimates.

* Non-GAAP measure. Customers’ reasons for the use of the non-GAAP measure and a detailed reconciliation between the non-GAAP measure and the comparable GAAP amount are included at the end of this document.

Key Balance Sheet Trends

Loans and Leases

The following table presents the composition of total loans and leases as of the dates indicated:

(Dollars in thousands)

 

December 31, 2024

 

% of Total

 

September 30, 2024

 

% of Total

 

December 31, 2023

 

% of Total

Loans and Leases Held for Investment

 

 

 

 

 

 

 

 

 

 

 

 

Commercial:

 

 

 

 

 

 

 

 

 

 

 

 

Commercial & industrial:

 

 

 

 

 

 

 

 

 

 

 

 

Specialized lending

 

$

5,842,420

 

40.4

%

 

$

5,468,507

 

39.7

%

 

$

5,006,693

 

38.9

%

Other commercial & industrial (1)

 

 

1,062,631

 

7.4

 

 

 

1,087,222

 

7.9

 

 

 

1,162,317

 

9.1

 

Mortgage finance

 

 

1,440,847

 

10.0

 

 

 

1,367,617

 

9.9

 

 

 

1,014,742

 

7.9

 

Multifamily

 

 

2,252,246

 

15.6

 

 

 

2,115,978

 

15.4

 

 

 

2,138,622

 

16.6

 

Commercial real estate owner occupied

 

 

1,100,944

 

7.6

 

 

 

981,904

 

7.1

 

 

 

797,319

 

6.2

 

Commercial real estate non-owner occupied

 

 

1,359,130

 

9.4

 

 

 

1,326,591

 

9.6

 

 

 

1,177,650

 

9.2

 

Construction

 

 

147,209

 

1.0

 

 

 

174,509

 

1.3

 

 

 

166,393

 

1.2

 

Total commercial loans and leases

 

 

13,205,427

 

91.4

 

 

 

12,522,328

 

90.9

 

 

 

11,463,736

 

89.1

 

Consumer:

 

 

 

 

 

 

 

 

 

 

 

 

Residential

 

 

496,559

 

3.4

 

 

 

500,786

 

3.6

 

 

 

484,435

 

3.8

 

Manufactured housing

 

 

33,123

 

0.3

 

 

 

34,481

 

0.3

 

 

 

38,670

 

0.3

 

Installment:

 

 

 

 

 

 

 

 

 

 

 

 

Personal

 

 

463,854

 

3.2

 

 

 

453,739

 

3.3

 

 

 

555,533

 

4.3

 

Other

 

 

249,799

 

1.7

 

 

 

266,362

 

1.9

 

 

 

319,393

 

2.5

 

Total installment loans

 

 

713,653

 

4.9

 

 

 

720,101

 

5.2

 

 

 

874,926

 

6.8

 

Total consumer loans

 

 

1,243,335

 

8.6

 

 

 

1,255,368

 

9.1

 

 

 

1,398,031

 

10.9

 

Total loans and leases held for investment

 

$

14,448,762

 

100.0

%

 

$

13,777,696

 

100.0

%

 

$

12,861,767

 

100.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans Held for Sale

 

 

 

 

 

 

 

 

 

 

 

 

Residential

 

$

1,836

 

0.9

%

 

$

2,523

 

0.9

%

 

$

1,215

 

0.3

%

Installment:

 

 

 

 

 

 

 

 

 

 

 

 

Personal

 

 

40,903

 

20.0

 

 

 

55,799

 

20.3

 

 

 

151,040

 

44.4

 

Other

 

 

162,055

 

79.1

 

 

 

217,098

 

78.8

 

 

 

188,062

 

55.3

 

Total installment loans

 

 

202,958

 

99.1

 

 

 

272,897

 

99.1

 

 

 

339,102

 

99.7

 

Total loans held for sale

 

$

204,794

 

100.0

%

 

$

275,420

 

100.0

%

 

$

340,317

 

100.0

%

Total loans and leases portfolio

 

$

14,653,556

 

 

 

$

14,053,116

 

 

 

$

13,202,084

 

 

(1)

 

Includes PPP loans of $22.8 million, $30.5 million and $74.7 million as of December 31, 2024, September 30, 2024 and December 31, 2023, respectively.

Loans and Leases Held for Investment

Loans and leases held for investment were $14.4 billion at December 31, 2024, up $671.1 million, or 4.9%, from September 30, 2024. Specialized lending increased by $373.9 million, or 6.8% quarter-over-quarter, to $5.8 billion. Multifamily loans increased by $136.3 million, or 6.4% to $2.3 billion. Owner-occupied commercial real estate loans increased by $119.0 million, or 12.1% to $1.1 billion. Mortgage finance loans increased by $73.2 million, or 5.4% to $1.4 billion. Non-owner occupied commercial real estate loans increased by $32.5 million, or 2.5% to $1.4 billion. These increases were partially offset by a decrease in other commercial and industrial loans of $24.6 million, or 2.3%, to $1.1 billion.

Loans and leases held for investment of $14.4 billion at December 31, 2024 were up $1.6 billion, or 12.3%, year-over-year. Specialized lending increased by $835.7 million, or 16.7% year-over-year. Mortgage finance loans increased by $426.1 million. Owner-occupied commercial real estate loans increased by $303.6 million. Non-owner occupied commercial real estate loans increased by $181.5 million. Multifamily loans increased by $113.6 million. These increases were partially offset by decreases in consumer installment loans of $161.3 million and other commercial and industrial loans of $99.7 million.

Loans Held for Sale

Loans held for sale decreased $70.6 million quarter-over-quarter, and were $204.8 million at December 31, 2024.

Allowance for Credit Losses on Loans and Leases

The following table presents the allowance for credit losses on loans and leases as of the dates and for the periods presented:

 

 

At or Three Months Ended

 

 

At or Three Months Ended

 

(Dollars in thousands)

 

December 31, 2024

 

September 30, 2024

 

Increase (Decrease)

 

December 31, 2024

 

December 31, 2023

 

Increase (Decrease)

Allowance for credit losses on loans and leases

 

$

136,775

 

 

$

133,158

 

 

$

3,617

 

 

$

136,775

 

 

$

135,311

 

 

$

1,464

 

Provision (benefit) for credit losses on loans and leases

 

$

18,229

 

 

$

17,766

 

 

$

463

 

 

$

18,229

 

 

$

13,420

 

 

$

4,809

 

Net charge-offs from loans held for investment

 

$

14,612

 

 

$

17,044

 

 

$

(2,432

)

 

$

14,612

 

 

$

17,322

 

 

$

(2,710

)

Annualized net charge-offs to average loans and leases

 

 

0.41

%

 

 

0.50

%

 

 

 

 

0.41

%

 

 

0.51

%

 

 

Coverage of credit loss reserves for loans and leases held for investment

 

 

1.04

%

 

 

1.06

%

 

 

 

 

1.04

%

 

 

1.13

%

 

 

Net charge-offs decreased with $14.6 million in Q4 2024, compared to $17.0 million in Q3 2024 and $17.3 million in Q4 2023.

Provision (benefit) for Credit Losses

 

 

Three Months Ended

 

 

Three Months Ended

 

(Dollars in thousands)

 

December 31, 2024

 

September 30, 2024

 

Increase (Decrease)

 

December 31, 2024

 

December 31, 2023

 

Increase (Decrease)

Provision (benefit) for credit losses on loans and leases

 

$

18,229

 

 

$

17,766

 

 

$

463

 

 

$

18,229

 

 

$

13,420

 

 

$

4,809

 

Provision (benefit) for credit losses on available for sale debt securities

 

 

2,965

 

 

 

(700

)

 

 

3,665

 

 

 

2,965

 

 

 

103

 

 

 

2,862

 

Provision for credit losses

 

 

21,194

 

 

 

17,066

 

 

 

4,128

 

 

 

21,194

 

 

 

13,523

 

 

 

7,671

 

Provision (benefit) for credit losses on unfunded commitments

 

 

(664

)

 

 

642

 

 

 

(1,306

)

 

 

(664

)

 

 

(136

)

 

 

(528

)

Total provision for credit losses

 

$

20,530

 

 

$

17,708

 

 

$

2,822

 

 

$

20,530

 

 

$

13,387

 

 

$

7,143

 

The provision for credit losses on loans and leases in Q4 2024 was $18.2 million, compared to $17.8 million in Q3 2024. The higher provision in Q4 2024 was primarily due to slight deterioration in macroeconomic forecasts.

The provision for credit losses on available for sale investment securities in Q4 2024 was a provision of $3.0 million, compared to a benefit to provision of $0.7 million in Q3 2024.

The provision for credit losses on loans and leases in Q4 2024 was $18.2 million, compared to $13.4 million in Q4 2023. The higher provision in Q4 2024 compared to the year ago period was primarily due to higher balances in commercial and industrial loan balances held for investment, partially offset by improvements in macroeconomic forecasts and lower balances in consumer installment loans held for investment.

The provision for credit losses on available for sale investment securities in Q4 2024 was a provision of $3.0 million compared to $0.1 million in Q4 2023.

Asset Quality

The following table presents asset quality metrics as of the dates indicated:

(Dollars in thousands)

 

December 31, 2024

 

September 30, 2024

 

Increase (Decrease)

 

December 31, 2024

 

December 31, 2023

 

Increase (Decrease)

Non-performing assets (“NPAs”):

 

 

 

 

 

 

 

 

 

 

 

 

Nonaccrual / non-performing loans (“NPLs”)

 

$

43,275

 

 

$

47,326

 

 

$

(4,051

)

 

$

43,275

 

 

$

27,110

 

 

$

16,165

 

Non-performing assets

 

$

55,807

 

 

$

47,326

 

 

$

8,481

 

 

$

55,807

 

 

$

27,209

 

 

$

28,598

 

NPLs to total loans and leases

 

 

0.30

%

 

 

0.34

%

 

 

 

 

0.30

%

 

 

0.21

%

 

 

Reserves to NPLs

 

 

316.06

%

 

 

281.36

%

 

 

 

 

316.06

%

 

 

499.12

%

 

 

NPAs to total assets

 

 

0.25

%

 

 

0.22

%

 

 

 

 

0.25

%

 

 

0.13

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans and leases (1) risk ratings:

 

 

 

 

 

 

 

 

 

 

 

 

Commercial loans and leases

 

 

 

 

 

 

 

 

 

 

 

 

Pass

 

$

11,403,930

 

 

$

10,844,500

 

 

$

559,430

 

 

$

11,403,930

 

 

$

9,955,243

 

 

$

1,448,687

 

Special Mention

 

 

175,055

 

 

 

178,026

 

 

 

(2,971

)

 

 

175,055

 

 

 

196,182

 

 

 

(21,127

)

Substandard

 

 

282,563

 

 

 

218,921

 

 

 

63,642

 

 

 

282,563

 

 

 

339,664

 

 

 

(57,101

)

Total commercial loans and leases

 

 

11,861,548

 

 

 

11,241,447

 

 

 

620,101

 

 

 

11,861,548

 

 

 

10,491,089

 

 

 

1,370,459

 

Consumer loans

 

 

 

 

 

 

 

 

 

 

 

 

Performing

 

 

1,227,359

 

 

 

1,240,581

 

 

 

(13,222

)

 

 

1,227,359

 

 

 

1,379,603

 

 

 

(152,244

)

Non-performing

 

 

15,976

 

 

 

14,787

 

 

 

1,189

 

 

 

15,976

 

 

 

18,428

 

 

 

(2,452

)

Total consumer loans

 

 

1,243,335

 

 

 

1,255,368

 

 

 

(12,033

)

 

 

1,243,335

 

 

 

1,398,031

 

 

 

(154,696

)

Loans and leases receivable (1)

 

$

13,104,883

 

 

$

12,496,815

 

 

$

608,068

 

 

$

13,104,883

 

 

$

11,889,120

 

 

$

1,215,763

 

(1)

 

Risk ratings are assigned to loans and leases held for investment, and excludes loans held for sale, loans receivable, mortgage finance, at fair value and eligible PPP loans that are fully guaranteed by the Small Business Administration.

Over the last decade, the Bank has developed a suite of commercial loan products with one particularly important common denominator: a relatively low credit risk assumption. The Bank’s commercial and industrial (“C&I”), mortgage finance, corporate and specialized lending lines of business, and multifamily loans for example, are characterized by conservative underwriting standards and historically low loss rates. Because of this emphasis, the Bank’s credit quality to date has been incredibly healthy despite a challenging economic and rate environment. Maintaining strong asset quality also requires a highly active portfolio monitoring process. In addition to frequent client outreach and monitoring at the individual loan level, management employs a bottom-up data driven approach to analyze the commercial portfolio.

Total consumer installment loans held for investment at December 31, 2024 were less than 4% of total assets and approximately 5% of total loans and leases held for investment, and were supported by an allowance for credit losses of $49.7 million. At December 31, 2024, the consumer installment portfolio had the following characteristics: average original FICO score of 742, average debt-to-income of 20% and average borrower income of $102 thousand.

Non-performing loans at December 31, 2024 decreased to 0.30% of total loans and leases, compared to 0.34% at September 30, 2024 and increased, compared to 0.21% at December 31, 2023.

Investment Securities

The investment securities portfolio, including debt securities classified as available for sale (“AFS”) and held to maturity (“HTM”) provides periodic cash flows through regular maturities and amortization, can be used as collateral to secure additional funding, and is an important component of the Bank’s liquidity position.

The following table presents the composition of the investment securities portfolio as of the dates indicated:

(Dollars in thousands)

 

December 31, 2024

 

September 30, 2024

 

December 31, 2023

Debt securities, available for sale

 

$

1,985,438

 

$

2,377,733

 

$

2,376,860

Equity securities

 

 

34,256

 

 

34,336

 

 

28,780

Investment securities, at fair value

 

 

2,019,694

 

 

2,412,069

 

 

2,405,640

Debt securities, held to maturity

 

 

991,937

 

 

1,064,437

 

 

1,103,170

Total investment securities portfolio

 

$

3,011,631

 

$

3,476,506

 

$

3,508,810

Customers’ securities portfolio is highly liquid, short in duration, and high in yield. At December 31, 2024, the AFS debt securities portfolio had a spot yield of 5.62%, an effective duration of approximately 2.6 years, and approximately 32% are variable rate. Additionally, 66% of the AFS securities portfolio was AAA rated at December 31, 2024.

At December 31, 2024, the HTM debt securities portfolio represented only 4.4% of total assets at December 31, 2024, had a spot yield of 4.13% and an effective duration of approximately 3.5 years. Additionally, at December 31, 2024, approximately 44% of the HTM securities were AAA rated and 52% were credit enhanced asset backed securities with no current expectation of credit losses.

Deposits

The following table presents the composition of our deposit portfolio as of the dates indicated:

(Dollars in thousands)

 

December 31, 2024

 

% of Total

 

September 30, 2024

 

% of Total

 

December 31, 2023

 

% of Total

Demand, non-interest bearing

 

$

5,608,288

 

29.7

%

 

$

4,670,809

 

25.9

%

 

$

4,422,494

 

24.7

%

Demand, interest bearing

 

 

5,553,698

 

29.5

 

 

 

5,606,500

 

31.0

 

 

 

5,580,527

 

31.1

 

Total demand deposits

 

 

11,161,986

 

59.2

 

 

 

10,277,309

 

56.9

 

 

 

10,003,021

 

55.8

 

Savings

 

 

1,131,819

 

6.0

 

 

 

1,399,968

 

7.7

 

 

 

1,402,941

 

7.8

 

Money market

 

 

3,844,451

 

20.4

 

 

 

3,961,028

 

21.9

 

 

 

3,226,395

 

18.0

 

Time deposits

 

 

2,708,205

 

14.4

 

 

 

2,431,084

 

13.5

 

 

 

3,287,879

 

18.4

 

Total deposits

 

$

18,846,461

 

100.0

%

 

$

18,069,389

 

100.0

%

 

$

17,920,236

 

100.0

%

Total deposits increased $777.1 million, or 4.3%, to $18.8 billion at December 31, 2024 as compared to the prior quarter. Non-interest bearing demand deposits increased $937.5 million, or 20.1%, to $5.6 billion and time deposits increased $277.1 million, or 11.4%, to $2.7 billion. These increases were offset by decreases in savings deposits of $268.1 million, or 19.2%, to $1.1 billion, money market deposits of $116.6 million, or 2.9%, to $3.8 billion and interest bearing demand deposits of $52.8 million, or 0.9%, to $5.6 billion. The total average cost of deposits decreased by 39 basis points to 3.07% in Q4 2024 from 3.46% in the prior quarter primarily due to a favorable shift in deposit mix and lower market interest rates. Total estimated uninsured deposits were $5.7 billion1, or 30% of total deposits (inclusive of accrued interest) at December 31, 2024.

Total deposits increased $926.2 million, or 5.2%, to $18.8 billion at December 31, 2024 as compared to a year ago. Non-interest bearing demand deposits increased $1.2 billion, or 26.8%, to $5.6 billion and money market deposits increased $618.1 million, or 19.2%, to $3.8 billion. These increases were offset by decreases in time deposits of $579.7 million, or 17.6% to $2.7 billion, savings deposits of $271.1 million, or 19.3%, to $1.1 billion and interest bearing demand deposits of $26.8 million, or 0.5%, to $5.6 billion. The total average cost of deposits decreased by 32 basis points to 3.07% in Q4 2024 from 3.39% in the prior year primarily due to a favorable shift in deposit mix and lower market interest rates.

1 Uninsured deposits (estimate) of $7.3 billion to be reported on the Bank’s call report, less deposits of $1.5 billion collateralized by standby letters of credit from the FHLB and from our affiliates of $176.2 million.

Borrowings

The following table presents the composition of our borrowings as of the dates indicated:

(Dollars in thousands)

 

December 31, 2024

 

September 30, 2024

 

December 31, 2023

FHLB advances

 

$

1,128,352

 

$

1,117,229

 

$

1,203,207

Senior notes

 

 

99,068

 

 

99,033

 

 

123,840

Subordinated debt

 

 

182,509

 

 

182,439

 

 

182,230

Total borrowings

 

$

1,409,929

 

$

1,398,701

 

$

1,509,277

Total borrowings increased $11.2 million, or 0.8%, to $1.4 billion at December 31, 2024 as compared to the prior quarter. This increase primarily resulted from net draws of $25.0 million in FHLB advances. As of December 31, 2024, Customers’ immediately available borrowing capacity with the FRB and FHLB was approximately $7.9 billion, of which $1.1 billion of available capacity was utilized in borrowings and $1.5 billion was utilized to collateralize deposits.

Total borrowings decreased $99.3 million, or 6.6%, to $1.4 billion at December 31, 2024 as compared to a year ago. This decrease primarily resulted from net repayments of $70.0 million in FHLB advances and $25.0 million in senior notes upon maturity.

Capital

The following table presents certain capital amounts and ratios as of the dates indicated:

(Dollars in thousands except per share data)

 

December 31, 2024

 

September 30, 2024

 

December 31, 2023

Customers Bancorp, Inc.

 

 

 

 

 

 

Common Equity

 

$

1,698,889

 

 

$

1,663,386

 

 

$

1,500,600

 

Tangible Common Equity*

 

$

1,695,260

 

 

$

1,659,757

 

 

$

1,496,971

 

Common Equity to Total Assets

 

 

7.6

%

 

 

7.8

%

 

 

7.0

%

Tangible Common Equity to Tangible Assets*

 

 

7.6

%

 

 

7.7

%

 

 

7.0

%

Book Value per common share

 

$

54.20

 

 

$

53.07

 

 

$

47.73

 

Tangible Book Value per common share*

 

$

54.08

 

 

$

52.96

 

 

$

47.61

 

Common equity Tier 1 (“CET 1”) capital ratio (1)

 

 

12.0

%

 

 

12.5

%

 

 

12.2

%

Total risk based capital ratio (1)

 

 

14.8

%

 

 

15.4

%

 

 

15.3

%

 

 

 

 

 

 

 

(1) Regulatory capital ratios as of December 31, 2024 are estimates.

* Non-GAAP measure. Customers’ reasons for the use of the non-GAAP measure and a detailed reconciliation between the non-GAAP measure and the comparable GAAP amount are included at the end of this document.

Customers Bancorp’s common equity increased $35.5 million to $1.7 billion, and tangible common equity* increased $35.5 million to $1.7 billion, at December 31, 2024 compared to the prior quarter, respectively, primarily from earnings of $23.3 million and decreased unrealized losses on investment securities of $9.5 million (net of taxes) deferred in accumulated other comprehensive income (“AOCI”). These increases were offset in part by $1.0 million of common share repurchases in Q4 2024. Similarly, book value per common share increased to $54.20 from $53.07, and tangible book value per common share* increased to $54.08 from $52.96, at December 31, 2024 and September 30, 2024, respectively.

Customers Bancorp’s common equity increased $198.3 million to $1.7 billion, and tangible common equity* increased $198.3 million to $1.7 billion, at December 31, 2024 compared to a year ago, respectively, primarily from earnings of $166.4 million and decreased unrealized losses on investment securities in AOCI of $40.0 million (net of taxes), offset in part by $19.2 million of common share repurchases. Similarly, book value per common share increased to $54.20 from $47.73, and tangible book value per common share* increased to $54.08 from $47.61, at December 31, 2024 and December 31, 2023, respectively.

At the Customers Bancorp level, the CET 1 ratio (estimate), total risk based capital ratio (estimate), common equity to total assets ratio and tangible common equity to tangible assets ratio* (“TCE / TA ratio”) were 12.0%, 14.8%, 7.6%, and 7.6%, respectively, at December 31, 2024.

At the Customers Bank level, capital levels remained strong and well above regulatory minimums. At December 31, 2024, Tier 1 capital (estimate) and total risk based capital (estimate) were 12.9% and 14.3%, respectively.

Key Profitability Trends

Net Interest Income

Net interest income totaled $167.8 million in Q4 2024, an increase of $9.3 million from Q3 2024. This increase was primarily due to lower interest expense of $11.5 million due to a favorable shift in deposit mix and lower market interest rates. Interest income decreased $2.2 million primarily due to lower interest income from investment securities, partially offset by higher balances in interest-earning deposits.

“Net interest income and net interest margin expanded in the quarter primarily driven by improvements in the liability side of the balance sheet as we lowered interest bearing deposit costs and had higher levels of average non-interest bearing deposits. This is evident in the fact that our total cost of deposits declined by 39 basis points during the quarter. Additionally, robust loan growth late in the quarter should provide a strong foundation for our net interest income in 2025,” stated Customers Bancorp President Sam Sidhu. “We have positive drivers to net interest income on both sides of the balance sheet though we continue to believe the best opportunity remains in reducing our interest expense with continued momentum from our new deposit focused commercial banking teams and across our franchise.”

Net interest income totaled $167.8 million in Q4 2024, a decrease of $4.7 million from Q4 2023. This decrease was primarily due to lower interest income in specialized lending and investment securities, partially offset by lower interest expense from a favorable shift in deposit mix, lower market interest rates and lower balances in other borrowings.

Non-Interest Income

The following table presents details of non-interest income for the periods indicated:

 

 

Three Months Ended

 

 

Three Months Ended

 

(Dollars in thousands)

 

December 31, 2024

 

September 30, 2024

 

Increase (Decrease)

 

December 31, 2024

 

December 31, 2023

 

Increase (Decrease)

Commercial lease income

 

$

10,604

 

 

$

10,093

 

 

$

511

 

 

$

10,604

 

 

$

9,035

 

 

$

1,569

 

Loan fees

 

 

8,639

 

 

 

8,011

 

 

 

628

 

 

 

8,639

 

 

 

5,926

 

 

 

2,713

 

Bank-owned life insurance

 

 

2,125

 

 

 

2,049

 

 

 

76

 

 

 

2,125

 

 

 

2,160

 

 

 

(35

)

Mortgage finance transactional fees

 

 

1,010

 

 

 

1,087

 

 

 

(77

)

 

 

1,010

 

 

 

927

 

 

 

83

 

Net gain (loss) on sale of loans and leases

 

 

(852

)

 

 

(14,548

)

 

 

13,696

 

 

 

(852

)

 

 

(91

)

 

 

(761

)

Net gain (loss) on sale of investment securities

 

 

(26,260

)

 

 

—

 

 

 

(26,260

)

 

 

(26,260

)

 

 

(145

)

 

 

(26,115

)

Unrealized gain on equity method investments

 

 

389

 

 

 

—

 

 

 

389

 

 

 

389

 

 

 

—

 

 

 

389

 

Other

 

 

3,954

 

 

 

1,865

 

 

 

2,089

 

 

 

3,954

 

 

 

860

 

 

 

3,094

 

Total non-interest income

 

$

(391

)

 

$

8,557

 

 

$

(8,948

)

 

$

(391

)

 

$

18,672

 

 

$

(19,063

)

Reported non-interest income totaled a loss of $0.4 million for Q4 2024, a decrease of $8.9 million compared to Q3 2024. The decrease was primarily due to $26.3 million in net realized loss on sale of investment securities, partially offset by a decrease of $13.6 million in loss on leases of commercial clean vehicles that were accounted for as sales-type leases and included within net gain (loss) on sale of loans and leases, and an increase in deposit account fees of $1.9 million. The commercial clean vehicle leases generated the same amount of investment tax credits that were included as a benefit to income tax expense in Q4 2024 and Q3 2024. In Q4 2024, the Bank invested the proceeds from the sale of lower yielding investment securities into higher yielding loans and investment securities.

Non-interest income totaled a loss of $0.4 million for Q4 2024, a decrease of $19.1 million compared to Q4 2023. The decrease was primarily due to $26.3 million in net realized loss on sale of investment securities, partially offset by increases in commercial lease income of $1.6 million, loan fees of $2.7 million primarily resulting from increased unused line of credit fees, and deposit account fees of $1.9 million.

Non-Interest Expense

The following table presents details of non-interest expense for the periods indicated:

 

 

Three Months Ended

 

 

Three Months Ended

 

(Dollars in thousands)

 

December 31, 2024

 

September 30, 2024

 

Increase (Decrease)

 

December 31, 2024

 

December 31, 2023

 

Increase (Decrease)

Salaries and employee benefits

 

$

47,147

 

$

47,717

 

$

(570

)

 

$

47,147

 

$

33,965

 

$

13,182

 

Technology, communication and bank operations

 

 

13,435

 

 

13,588

 

 

(153

)

 

 

13,435

 

 

16,887

 

 

(3,452

)

Commercial lease depreciation

 

 

8,933

 

 

7,811

 

 

1,122

 

 

 

8,933

 

 

7,357

 

 

1,576

 

Professional services

 

 

13,473

 

 

9,048

 

 

4,425

 

 

 

13,473

 

 

9,820

 

 

3,653

 

Loan servicing

 

 

4,584

 

 

3,778

 

 

806

 

 

 

4,584

 

 

3,779

 

 

805

 

Occupancy

 

 

3,335

 

 

2,987

 

 

348

 

 

 

3,335

 

 

2,320

 

 

1,015

 

FDIC assessments, non-income taxes and regulatory fees

 

 

10,077

 

 

7,902

 

 

2,175

 

 

 

10,077

 

 

13,977

 

 

(3,900

)

Advertising and promotion

 

 

1,645

 

 

908

 

 

737

 

 

 

1,645

 

 

850

 

 

795

 

Other

 

 

7,746

 

 

10,279

 

 

(2,533

)

 

 

7,746

 

 

4,812

 

 

2,934

 

Total non-interest expense

 

$

110,375

 

$

104,018

 

$

6,357

 

 

$

110,375

 

$

93,767

 

$

16,608

 

Non-interest expenses totaled $110.4 million in Q4 2024, an increase of $6.4 million compared to Q3 2024. The increase was primarily attributable to increases of $4.4 million in professional fees including continued investment in our risk management infrastructure, and $2.2 million in FDIC assessments, non-income taxes and regulatory fees mainly due to a credit of $3.0 million in non-income taxes recorded in Q3 2024 for periods prior to 2024.

“In the quarter we incurred professional services expense of approximately $5.7 million as we made investments to enhance our risk management infrastructure. We expect these costs to remain elevated for the next quarter or so before tapering down as we seek to build a best-in-class risk management function which we believe can be a competitive advantage for the bank in the future. During the quarter we advanced our operational excellence initiative to provide the capacity for these and other investments which we are, and will continue to make, in our franchise to position us for success in the both the near-term and over the long-term,” stated Sam Sidhu.

Non-interest expenses totaled $110.4 million in Q4 2024, an increase of $16.6 million compared to Q4 2023. The increase was primarily attributable to increases of $13.2 million in salaries and employee benefits primarily due to higher headcount including the addition of new banking teams in 2024, annual merit increases, incentives and severance, $3.7 million in professional fees including the investment in our risk management infrastructure, and fees paid to a fintech company related to consumer installment loans originated and held for sale. These increases were partially offset by decreases in FDIC assessments primarily due to $3.7 million of FDIC special assessment in Q4 2023 and deposit servicing fees.

Taxes

Income tax expense increased by $9.7 million to a provision of $8.9 million in Q4 2024 from a benefit of $0.7 million in Q3 2024 primarily due to lower investment tax credits in Q4 2024, partially offset by lower pre-tax income. The decrease in investment tax credits was primarily due to $0.6 million of investment tax credits generated from commercial clean vehicles in Q4 2024 as compared to $14.3 million in Q3 2024. The investment tax credits from commercial clean vehicle leases were the same amount as the loss on leases of commercial clean vehicles included within net gain (loss) on sale of loans and leases in Q4 2024 and Q3 2024.

Income tax expense decreased by $12.9 million to a provision of $8.9 million in Q4 2024 from a provision of $21.8 million in Q4 2023 primarily due to lower pre-tax income and an increase in income tax credits for 2024, including $14.9 million of investment tax credits generated from commercial clean vehicles in 2024. The investment tax credits from commercial clean vehicle leases were the same amount as the loss on leases of commercial clean vehicles included within net gain (loss) on sale of loans and leases in 2024. The effective tax rate was 24.9% for Q4 2024 and 19.1% for the full year 2024.

Outlook

“Looking forward, our strategy remains unchanged. We are focused on continuing the transformation of our deposit franchise, further strengthening our risk management and compliance infrastructure, improving our profitability and growing net interest income, and maintaining strong capital ratios, liquidity, and credit quality. Our deposit transformation momentum is continuing. As a result, we expect deposit growth of 5% to 9% during 2025 with gross inflows expected to be higher as we continue to remix out less strategic deposits especially in the first half of the year. With strong loan pipelines and attractive opportunities from across our various verticals we are targeting to increase the loan portfolio by about 7% to 10% in 2025. Through the combination of these factors we expect our net interest income to increase between 3% to 7% in 2025. Operating efficiency has been and remains a priority for us even while we continue to make significant investments in our future. We see our core efficiency ratio* for the year in the low to mid 50’s as the execution of our strategic priorities take hold and as we move toward completion of some of our outsized investment. We remain committed to maintaining higher levels of capital with CET 1 ratio target of 11.5% in 2025. We expect an effective tax rate to be between 22% to 25%. We remain focused on executing in those areas which differentiate us from our peers and believe that providing truly exceptional service, sophisticated product offerings and a single-point-of-contact service model will deliver strategic, organic growth. We believe we are incredibly well positioned to continue to win new client relationships and that we have the right strategy, the right team, and a client-centric culture to achieve our goals in 2025 and beyond,” concluded Sam Sidhu.

 

 

 

 

 

 

*

 

Non-GAAP measure. Customers' reasons for the use of the non-GAAP measure and a detailed reconciliation between the non-GAAP measure and the comparable GAAP amount are included at the end of this document.

Webcast

 

 

Date:

 

Friday, January 24, 2025

Time:

 

9:00 AM EDT

The live audio webcast, presentation slides, and earnings press release will be made available at https://www.customersbank.com and at the Customers Bancorp 4th Quarter Earnings Webcast.

You may submit questions in advance of the live webcast by emailing our Head of Corporate Communications, Jordan Baucum at jbaucum@customersbank.com.

The webcast will be archived for viewing on the Customers Bank Investor Relations page and available beginning approximately two hours after the conclusion of the live event.

Institutional Background

Customers Bancorp, Inc. (NYSE:CUBI) is one of the nation’s top-performing banking companies with over $22 billion in assets making it one of the 80 largest bank holding companies in the U.S. Customers Bank’s commercial and consumer clients benefit from a full suite of technology-enabled tailored product experiences delivered by best-in-class customer service distinguished by a Single Point of Contact approach. In addition to traditional lines such as C&I lending, commercial real estate lending and multifamily lending, Customers Bank also provides a number of national corporate banking services to specialized lending clients. Major accolades include:

• No. 1 on American Banker 2024 list of top-performing banks with $10B to $50B in assets
• No. 29 out of the 100 largest publicly traded banks in 2024 Forbes Best Banks list
• No. 52 on Investor’s Business Daily 100 Best Stocks for 2023

A member of the Federal Reserve System with deposits insured by the Federal Deposit Insurance Corporation, Customers Bank is an equal opportunity lender. Learn more: www.customersbank.com.

“Safe Harbor” Statement

In addition to historical information, this press release may contain “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements with respect to Customers Bancorp, Inc.’s strategies, goals, beliefs, expectations, estimates, intentions, capital raising efforts, financial condition and results of operations, future performance and business. Statements preceded by, followed by, or that include the words “may,” “could,” “should,” “pro forma,” “looking forward,” “would,” “believe,” “expect,” “anticipate,” “estimate,” “intend,” “plan,” “project,” or similar expressions generally indicate a forward-looking statement. These forward-looking statements involve risks and uncertainties that are subject to change based on various important factors (some of which, in whole or in part, are beyond Customers Bancorp, Inc.’s control). Numerous competitive, economic, regulatory, legal and technological events and factors, among others, could cause Customers Bancorp, Inc.’s financial performance to differ materially from the goals, plans, objectives, intentions and expectations expressed in such forward-looking statements, including: a continuation of the recent turmoil in the banking industry, responsive measures taken by us and regulatory authorities to mitigate and manage related risks, regulatory actions taken that address related issues and the costs and obligations associated therewith, such as the FDIC special assessments; the potential for negative consequences resulting from regulatory violations, investigations and examinations, including potential supervisory actions, the assessment of fines and penalties, the imposition of sanctions, the need to undertake remedial actions and possible damage to our reputation; effects of competition on deposit rates and growth, loan rates and growth and net interest margin; failure to identify and adequately and promptly address cybersecurity risks, including data breaches and cyberattacks; public health crises and pandemics and their effects on the economic and business environments in which we operate; geopolitical conditions, including acts or threats of terrorism, actions taken by the United States or other governments in response to acts or threats of terrorism and military conflicts, including the war between Russia and Ukraine and escalating conflict in the Middle East, which could impact economic conditions in the United States; the impact that changes in the economy have on the performance of our loan and lease portfolio, the market value of our investment securities, the demand for our products and services and the availability of sources of funding; the effects of actions by the federal government, including the Board of Governors of the Federal Reserve System and other government agencies, that affect market interest rates and the money supply; actions that we and our customers take in response to these developments and the effects such actions have on our operations, products, services and customer relationships; higher inflation and its impacts; and the effects of any changes in accounting standards or policies. Customers Bancorp, Inc. cautions that the foregoing factors are not exclusive, and neither such factors nor any such forward-looking statement takes into account the impact of any future events. All forward-looking statements and information set forth herein are based on management’s current beliefs and assumptions as of the date hereof and speak only as of the date they are made. For a more complete discussion of the assumptions, risks and uncertainties related to our business, you are encouraged to review Customers Bancorp, Inc.’s filings with the Securities and Exchange Commission, including its most recent annual report on Form 10-K for the year ended December 31, 2023, subsequently filed quarterly reports on Form 10-Q and current reports on Form 8-K, including any amendments thereto, that update or provide information in addition to the information included in the Form 10-K and Form 10-Q filings, if any. Customers Bancorp, Inc. does not undertake to update any forward-looking statement whether written or oral, that may be made from time to time by Customers Bancorp, Inc. or by or on behalf of Customers Bank, except as may be required under applicable law.

Q4 2024 Overview

The following table presents a summary of key earnings and performance metrics for the quarter ended December 31, 2024 and the preceding four quarters, and full year 2024 and 2023:

CUSTOMERS BANCORP, INC. AND SUBSIDIARIES

EARNINGS SUMMARY - UNAUDITED

 

 

Q4

 

Q3

 

Q2

 

Q1

 

Q4

 

Twelve Months Ended December 31,

(Dollars in thousands, except per share data and stock price data)  

2024

 

2024

 

2024

 

2024

 

2023

 

2024

 

2023

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP Profitability Metrics:

Net income available to common shareholders

 

 

$

23,266

 

 

$

42,937

 

 

$

54,300

 

 

$

45,926

 

 

$

58,223

 

 

$

166,429

 

 

$

235,448

 

Per share amounts:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per share - basic

 

$

0.74

 

 

$

1.36

 

 

$

1.72

 

 

$

1.46

 

 

$

1.86

 

 

$

5.28

 

 

$

7.49

 

Earnings per share - diluted

 

$

0.71

 

 

$

1.31

 

 

$

1.66

 

 

$

1.40

 

 

$

1.79

 

 

$

5.09

 

 

$

7.32

 

Book value per common share (1)

 

$

54.20

 

 

$

53.07

 

 

$

50.81

 

 

$

49.29

 

 

$

47.73

 

 

$

54.20

 

 

$

47.73

 

CUBI stock price (1)

 

$

48.68

 

 

$

46.45

 

 

$

47.98

 

 

$

53.06

 

 

$

57.62

 

 

$

48.68

 

 

$

57.62

 

CUBI stock price as % of book value (1)

 

 

90

%

 

 

88

%

 

 

94

%

 

 

108

%

 

 

121

%

 

 

90

%

 

 

121

%

Average shares outstanding - basic

 

 

31,346,920

 

 

 

31,567,797

 

 

 

31,649,715

 

 

 

31,473,424

 

 

 

31,385,043

 

 

 

31,509,179

 

 

 

31,435,647

 

Average shares outstanding - diluted

 

 

32,557,621

 

 

 

32,766,488

 

 

 

32,699,149

 

 

 

32,854,534

 

 

 

32,521,787

 

 

 

32,719,134

 

 

 

32,158,788

 

Shares outstanding (1)

 

 

31,346,507

 

 

 

31,342,107

 

 

 

31,667,655

 

 

 

31,521,931

 

 

 

31,440,906

 

 

 

31,346,507

 

 

 

31,440,906

 

Return on average assets (“ROAA”)

 

 

0.48

%

 

 

0.88

%

 

 

1.11

%

 

 

0.94

%

 

 

1.16

%

 

 

0.85

%

 

 

1.16

%

Return on average common equity (“ROCE”)

 

 

5.50

%

 

 

10.44

%

 

 

13.85

%

 

 

12.08

%

 

 

15.93

%

 

 

10.36

%

 

 

17.33

%

Net interest margin, tax equivalent

 

 

3.11

%

 

 

3.06

%

 

 

3.29

%

 

 

3.10

%

 

 

3.31

%

 

 

3.15

%

 

 

3.29

%

Efficiency ratio

 

 

56.86

%

 

 

62.40

%

 

 

51.87

%

 

 

54.58

%

 

 

49.08

%

 

 

56.21

%

 

 

46.49

%

Non-GAAP Profitability Metrics (2):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Core earnings

 

$

44,168

 

 

$

43,838

 

 

$

48,567

 

 

$

46,532

 

 

$

61,633

 

 

$

183,105

 

 

$

248,233

 

Core pre-tax pre-provision net income

 

$

84,224

 

 

$

64,824

 

 

$

89,220

 

 

$

83,674

 

 

$

101,884

 

 

$

321,942

 

 

$

416,563

 

Per share amounts:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Core earnings per share - diluted

 

$

1.36

 

 

$

1.34

 

 

$

1.49

 

 

$

1.42

 

 

$

1.90

 

 

$

5.60

 

 

$

7.72

 

Tangible book value per common share (1)

 

$

54.08

 

 

$

52.96

 

 

$

50.70

 

 

$

49.18

 

 

$

47.61

 

 

$

54.08

 

 

$

47.61

 

CUBI stock price as % of tangible book value (1)

 

 

90

%

 

 

88

%

 

 

95

%

 

 

108

%

 

 

121

%

 

 

90

%

 

 

121

%

Core ROAA

 

 

0.86

%

 

 

0.89

%

 

 

1.00

%

 

 

0.95

%

 

 

1.22

%

 

 

0.92

%

 

 

1.22

%

Core ROCE

 

 

10.44

%

 

 

10.66

%

 

 

12.39

%

 

 

12.24

%

 

 

16.87

%

 

 

11.40

%

 

 

18.27

%

Core pre-tax pre-provision ROAA

 

 

1.51

%

 

 

1.21

%

 

 

1.71

%

 

 

1.58

%

 

 

1.90

%

 

 

1.50

%

 

 

1.94

%

Core pre-tax pre-provision ROCE

 

 

19.04

%

 

 

14.84

%

 

 

21.79

%

 

 

21.01

%

 

 

26.82

%

 

 

19.10

%

 

 

29.58

%

Core efficiency ratio

 

 

56.12

%

 

 

61.69

%

 

 

53.47

%

 

 

54.24

%

 

 

46.70

%

 

 

56.25

%

 

 

45.45

%

Asset Quality:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net charge-offs

 

$

14,612

 

 

$

17,044

 

 

$

18,711

 

 

$

17,968

 

 

$

17,322

 

 

$

68,335

 

 

$

69,035

 

Annualized net charge-offs to average total loans and leases

 

 

0.41

%

 

 

0.50

%

 

 

0.56

%

 

 

0.55

%

 

 

0.51

%

 

 

0.50

%

 

 

0.48

%

Non-performing loans (“NPLs”) to total loans and leases (1)

 

 

0.30

%

 

 

0.34

%

 

 

0.35

%

 

 

0.27

%

 

 

0.21

%

 

 

0.30

%

 

 

0.21

%

Reserves to NPLs (1)

 

 

316.06

%

 

 

281.36

%

 

 

279.52

%

 

 

373.86

%

 

 

499.12

%

 

 

316.06

%

 

 

499.12

%

Non-performing assets (“NPAs”) to total assets

 

 

0.25

%

 

 

0.22

%

 

 

0.23

%

 

 

0.17

%

 

 

0.13

%

 

 

0.25

%

 

 

0.13

%

Customers Bank Capital Ratios (3):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common equity Tier 1 capital to risk-weighted assets

 

 

12.9

%

 

 

13.64

%

 

 

14.17

%

 

 

14.16

%

 

 

13.77

%

 

 

12.9

%

 

 

13.77

%

Tier 1 capital to risk-weighted assets

 

 

12.9

%

 

 

13.64

%

 

 

14.17

%

 

 

14.16

%

 

 

13.77

%

 

 

12.9

%

 

 

13.77

%

Total capital to risk-weighted assets

 

 

14.3

%

 

 

15.06

%

 

 

15.64

%

 

 

15.82

%

 

 

15.28

%

 

 

14.3

%

 

 

15.28

%

Tier 1 capital to average assets (leverage ratio)

 

 

8.7

%

 

 

9.08

%

 

 

9.16

%

 

 

8.82

%

 

 

8.71

%

 

 

8.7

%

 

 

8.71

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Metric is a spot balance for the last day of each quarter presented.

(2) Customers’ reasons for the use of these non-GAAP measures and a detailed reconciliation between the non-GAAP measures and the comparable GAAP amounts are included at the end of this document.

(3) Regulatory capital ratios are estimated for Q4 2024 and actual for the remaining periods. In accordance with regulatory capital rules, Customers elected to apply the CECL capital transition provisions which delayed the effects of CECL on regulatory capital for two years until January 1, 2022, followed by a three-year transition period. The cumulative CECL capital transition impact as of December 31, 2021 which amounted to $61.6 million will be phased in at 25% per year beginning on January 1, 2022 through December 31, 2024. As of December 31, 2024, our regulatory capital ratios reflected 25%, or $15.4 million, benefit associated with the CECL transition provisions.

CUSTOMERS BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS - UNAUDITED

(Dollars in thousands, except per share data)

 

 

 

 

 

 

 

 

 

 

 

Twelve Months Ended

 

 

Q4

 

Q3

 

Q2

 

Q1

 

Q4

 

December 31,

 

 

2024

 

2024

 

2024

 

2024

 

2023

 

2024

 

2023

Interest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans and leases

 

$

230,534

 

 

$

228,659

 

 

$

224,265

 

 

$

217,999

 

 

$

239,453

 

 

$

901,457

 

 

$

996,517

 

Investment securities

 

 

39,638

 

 

 

46,265

 

 

 

47,586

 

 

 

46,802

 

 

 

51,074

 

 

 

180,291

 

 

 

200,659

 

Interest earning deposits

 

 

48,147

 

 

 

44,372

 

 

 

45,506

 

 

 

52,817

 

 

 

44,104

 

 

 

190,842

 

 

 

125,923

 

Loans held for sale

 

 

9,447

 

 

 

10,907

 

 

 

13,671

 

 

 

12,048

 

 

 

8,707

 

 

 

46,073

 

 

 

36,221

 

Other

 

 

2,140

 

 

 

1,910

 

 

 

3,010

 

 

 

2,111

 

 

 

2,577

 

 

 

9,171

 

 

 

8,040

 

Total interest income

 

 

329,906

 

 

 

332,113

 

 

 

334,038

 

 

 

331,777

 

 

 

345,915

 

 

 

1,327,834

 

 

 

1,367,360

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits

 

 

144,974

 

 

 

155,829

 

 

 

148,784

 

 

 

153,725

 

 

 

150,307

 

 

 

603,312

 

 

 

576,437

 

FHLB advances

 

 

12,595

 

 

 

12,590

 

 

 

13,437

 

 

 

13,485

 

 

 

18,868

 

 

 

52,107

 

 

 

80,008

 

FRB advances

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

6,286

 

Subordinated debt

 

 

3,349

 

 

 

3,537

 

 

 

2,734

 

 

 

2,689

 

 

 

2,688

 

 

 

12,309

 

 

 

10,755

 

Other borrowings

 

 

1,167

 

 

 

1,612

 

 

 

1,430

 

 

 

1,493

 

 

 

1,546

 

 

 

5,702

 

 

 

6,425

 

Total interest expense

 

 

162,085

 

 

 

173,568

 

 

 

166,385

 

 

 

171,392

 

 

 

173,409

 

 

 

673,430

 

 

 

679,911

 

Net interest income

 

 

167,821

 

 

 

158,545

 

 

 

167,653

 

 

 

160,385

 

 

 

172,506

 

 

 

654,404

 

 

 

687,449

 

Provision for credit losses

 

 

21,194

 

 

 

17,066

 

 

 

18,121

 

 

 

17,070

 

 

 

13,523

 

 

 

73,451

 

 

 

74,611

 

Net interest income after provision for credit losses

 

 

146,627

 

 

 

141,479

 

 

 

149,532

 

 

 

143,315

 

 

 

158,983

 

 

 

580,953

 

 

 

612,838

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-interest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial lease income

 

 

10,604

 

 

 

10,093

 

 

 

10,282

 

 

 

9,683

 

 

 

9,035

 

 

 

40,662

 

 

 

36,179

 

Loan fees

 

 

8,639

 

 

 

8,011

 

 

 

5,233

 

 

 

5,280

 

 

 

5,926

 

 

 

27,163

 

 

 

20,216

 

Bank-owned life insurance

 

 

2,125

 

 

 

2,049

 

 

 

2,007

 

 

 

3,261

 

 

 

2,160

 

 

 

9,442

 

 

 

11,777

 

Mortgage finance transactional fees

 

 

1,010

 

 

 

1,087

 

 

 

1,058

 

 

 

946

 

 

 

927

 

 

 

4,101

 

 

 

4,395

 

Net gain (loss) on sale of loans and leases

 

 

(852

)

 

 

(14,548

)

 

 

(238

)

 

 

10

 

 

 

(91

)

 

 

(15,628

)

 

 

(1,200

)

Loss on sale of capital call lines of credit

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(5,037

)

Net gain (loss) on sale of investment securities

 

 

(26,260

)

 

 

—

 

 

 

(719

)

 

 

(30

)

 

 

(145

)

 

 

(27,009

)

 

 

(574

)

Unrealized gain on equity method investments

 

 

389

 

 

 

—

 

 

 

11,041

 

 

 

—

 

 

 

—

 

 

 

11,430

 

 

 

—

 

Other

 

 

3,954

 

 

 

1,865

 

 

 

2,373

 

 

 

2,081

 

 

 

860

 

 

 

10,273

 

 

 

4,809

 

Total non-interest income

 

 

(391

)

 

 

8,557

 

 

 

31,037

 

 

 

21,231

 

 

 

18,672

 

 

 

60,434

 

 

 

70,565

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

 

47,147

 

 

 

47,717

 

 

 

44,947

 

 

 

36,025

 

 

 

33,965

 

 

 

175,836

 

 

 

133,275

 

Technology, communication and bank operations

 

 

13,435

 

 

 

13,588

 

 

 

16,227

 

 

 

21,904

 

 

 

16,887

 

 

 

65,154

 

 

 

65,550

 

Commercial lease depreciation

 

 

8,933

 

 

 

7,811

 

 

 

7,829

 

 

 

7,970

 

 

 

7,357

 

 

 

32,543

 

 

 

29,898

 

Professional services

 

 

13,473

 

 

 

9,048

 

 

 

6,104

 

 

 

6,353

 

 

 

9,820

 

 

 

34,978

 

 

 

35,177

 

Loan servicing

 

 

4,584

 

 

 

3,778

 

 

 

3,516

 

 

 

4,031

 

 

 

3,779

 

 

 

15,909

 

 

 

17,075

 

Occupancy

 

 

3,335

 

 

 

2,987

 

 

 

3,120

 

 

 

2,347

 

 

 

2,320

 

 

 

11,789

 

 

 

10,070

 

FDIC assessments, non-income taxes and regulatory fees

 

 

10,077

 

 

 

7,902

 

 

 

10,236

 

 

 

13,469

 

 

 

13,977

 

 

 

41,684

 

 

 

35,036

 

Advertising and promotion

 

 

1,645

 

 

 

908

 

 

 

1,254

 

 

 

682

 

 

 

850

 

 

 

4,489

 

 

 

3,095

 

Legal settlement expense

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

4,096

 

Other

 

 

7,746

 

 

 

10,279

 

 

 

10,219

 

 

 

6,388

 

 

 

4,812

 

 

 

34,632

 

 

 

19,391

 

Total non-interest expense

 

 

110,375

 

 

 

104,018

 

 

 

103,452

 

 

 

99,169

 

 

 

93,767

 

 

 

417,014

 

 

 

352,663

 

Income before income tax expense (benefit)

 

 

35,861

 

 

 

46,018

 

 

 

77,117

 

 

 

65,377

 

 

 

83,888

 

 

 

224,373

 

 

 

330,740

 

Income tax expense (benefit)

 

 

8,946

 

 

 

(725

)

 

 

19,032

 

 

 

15,651

 

 

 

21,796

 

 

 

42,904

 

 

 

80,597

 

Net income

 

 

26,915

 

 

 

46,743

 

 

 

58,085

 

 

 

49,726

 

 

 

62,092

 

 

 

181,469

 

 

 

250,143

 

Preferred stock dividends

 

 

3,649

 

 

 

3,806

 

 

 

3,785

 

 

 

3,800

 

 

 

3,869

 

 

 

15,040

 

 

 

14,695

 

Net income available to common shareholders

 

$

23,266

 

 

$

42,937

 

 

$

54,300

 

 

$

45,926

 

 

$

58,223

 

 

$

166,429

 

 

$

235,448

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per common share

 

$

0.74

 

 

$

1.36

 

 

$

1.72

 

 

$

1.46

 

 

$

1.86

 

 

$

5.28

 

 

$

7.49

 

Diluted earnings per common share

 

 

0.71

 

 

 

1.31

 

 

 

1.66

 

 

 

1.40

 

 

 

1.79

 

 

 

5.09

 

 

 

7.32

 

CUSTOMERS BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEET - UNAUDITED

(Dollars in thousands)

 

 

December 31,

 

September 30,

 

June 30,

 

March 31,

 

December 31,

 

 

2024

 

2024

 

2024

 

2024

 

2023

ASSETS

 

 

 

 

 

 

 

 

 

 

Cash and due from banks

 

$

56,787

 

 

$

39,429

 

 

$

45,045

 

 

$

51,974

 

 

$

45,210

 

Interest earning deposits

 

 

3,729,144

 

 

 

3,048,593

 

 

 

3,003,542

 

 

 

3,649,146

 

 

 

3,801,136

 

Cash and cash equivalents

 

 

3,785,931

 

 

 

3,088,022

 

 

 

3,048,587

 

 

 

3,701,120

 

 

 

3,846,346

 

Investment securities, at fair value

 

 

2,019,694

 

 

 

2,412,069

 

 

 

2,511,650

 

 

 

2,604,868

 

 

 

2,405,640

 

Investment securities held to maturity

 

 

991,937

 

 

 

1,064,437

 

 

 

962,799

 

 

 

1,032,037

 

 

 

1,103,170

 

Loans held for sale

 

 

204,794

 

 

 

275,420

 

 

 

375,724

 

 

 

357,640

 

 

 

340,317

 

Loans and leases receivable

 

 

13,127,634

 

 

 

12,527,283

 

 

 

12,254,204

 

 

 

11,936,621

 

 

 

11,963,855

 

Loans receivable, mortgage finance, at fair value

 

 

1,321,128

 

 

 

1,250,413

 

 

 

1,002,711

 

 

 

962,610

 

 

 

897,912

 

Allowance for credit losses on loans and leases

 

 

(136,775

)

 

 

(133,158

)

 

 

(132,436

)

 

 

(133,296

)

 

 

(135,311

)

Total loans and leases receivable, net of allowance for credit losses on loans and leases

 

 

14,311,987

 

 

 

13,644,538

 

 

 

13,124,479

 

 

 

12,765,935

 

 

 

12,726,456

 

FHLB, Federal Reserve Bank, and other restricted stock

 

 

96,214

 

 

 

95,035

 

 

 

92,276

 

 

 

100,067

 

 

 

109,548

 

Accrued interest receivable

 

 

108,351

 

 

 

115,588

 

 

 

112,788

 

 

 

120,123

 

 

 

114,766

 

Bank premises and equipment, net

 

 

6,668

 

 

 

6,730

 

 

 

7,019

 

 

 

7,253

 

 

 

7,371

 

Bank-owned life insurance

 

 

297,641

 

 

 

295,531

 

 

 

293,108

 

 

 

293,400

 

 

 

292,193

 

Goodwill and other intangibles

 

 

3,629

 

 

 

3,629

 

 

 

3,629

 

 

 

3,629

 

 

 

3,629

 

Other assets

 

 

481,395

 

 

 

455,083

 

 

 

410,916

 

 

 

361,295

 

 

 

366,829

 

Total assets

 

$

22,308,241

 

 

$

21,456,082

 

 

$

20,942,975

 

 

$

21,347,367

 

 

$

21,316,265

 

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

Demand, non-interest bearing deposits

 

$

5,608,288

 

 

$

4,670,809

 

 

$

4,474,862

 

 

$

4,688,880

 

 

$

4,422,494

 

Interest bearing deposits

 

 

13,238,173

 

 

 

13,398,580

 

 

 

13,203,231

 

 

 

13,272,503

 

 

 

13,497,742

 

Total deposits

 

 

18,846,461

 

 

 

18,069,389

 

 

 

17,678,093

 

 

 

17,961,383

 

 

 

17,920,236

 

FHLB advances

 

 

1,128,352

 

 

 

1,117,229

 

 

 

1,018,349

 

 

 

1,195,088

 

 

 

1,203,207

 

Other borrowings

 

 

99,068

 

 

 

99,033

 

 

 

123,970

 

 

 

123,905

 

 

 

123,840

 

Subordinated debt

 

 

182,509

 

 

 

182,439

 

 

 

182,370

 

 

 

182,300

 

 

 

182,230

 

Accrued interest payable and other liabilities

 

 

215,168

 

 

 

186,812

 

 

 

193,328

 

 

 

193,074

 

 

 

248,358

 

Total liabilities

 

 

20,471,558

 

 

 

19,654,902

 

 

 

19,196,110

 

 

 

19,655,750

 

 

 

19,677,871

 

 

 

 

 

 

 

 

 

 

 

 

Preferred stock

 

 

137,794

 

 

 

137,794

 

 

 

137,794

 

 

 

137,794

 

 

 

137,794

 

Common stock

 

 

35,758

 

 

 

35,734

 

 

 

35,686

 

 

 

35,540

 

 

 

35,459

 

Additional paid in capital

 

 

575,333

 

 

 

571,609

 

 

 

567,345

 

 

 

567,490

 

 

 

564,538

 

Retained earnings

 

 

1,326,011

 

 

 

1,302,745

 

 

 

1,259,808

 

 

 

1,205,508

 

 

 

1,159,582

 

Accumulated other comprehensive income (loss), net

 

 

(96,560

)

 

 

(106,082

)

 

 

(131,358

)

 

 

(132,305

)

 

 

(136,569

)

Treasury stock, at cost

 

 

(141,653

)

 

 

(140,620

)

 

 

(122,410

)

 

 

(122,410

)

 

 

(122,410

)

Total shareholders’ equity

 

 

1,836,683

 

 

 

1,801,180

 

 

 

1,746,865

 

 

 

1,691,617

 

 

 

1,638,394

 

Total liabilities and shareholders’ equity

 

$

22,308,241

 

 

$

21,456,082

 

 

$

20,942,975

 

 

$

21,347,367

 

 

$

21,316,265

 

CUSTOMERS BANCORP, INC. AND SUBSIDIARIES

AVERAGE BALANCE SHEET / NET INTEREST MARGIN - UNAUDITED

(Dollars in thousands)

 

 

 

 

Three Months Ended

 

 

December 31, 2024

 

September 30, 2024

 

December 31, 2023

 

 

Average Balance

 

Interest Income or Expense

 

Average Yield or Cost (%)

 

Average Balance

 

Interest Income or Expense

 

Average Yield or Cost (%)

 

Average Balance

 

Interest Income or Expense

 

Average Yield or Cost (%)

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest earning deposits

 

$

3,973,262

 

$

48,147

 

4.82

%

 

$

3,224,940

 

$

44,372

 

5.47

%

 

$

3,191,677

 

$

44,104

 

5.48

%

Investment securities (1)

 

 

3,392,850

 

 

39,638

 

4.65

%

 

 

3,706,974

 

 

46,265

 

4.97

%

 

 

4,007,418

 

 

51,074

 

5.10

%

Loans and leases:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial & industrial:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Specialized lending loans and leases (2)

 

 

6,022,062

 

 

121,818

 

8.05

%

 

 

5,805,389

 

 

124,667

 

8.54

%

 

 

5,574,149

 

 

130,838

 

9.31

%

Other commercial & industrial loans (2)(3)

 

 

1,529,478

 

 

25,514

 

6.64

%

 

 

1,533,057

 

 

24,654

 

6.40

%

 

 

1,666,052

 

 

28,053

 

6.68

%

Mortgage finance loans

 

 

1,316,884

 

 

16,704

 

5.05

%

 

 

1,267,656

 

 

17,723

 

5.56

%

 

 

997,353

 

 

13,726

 

5.46

%

Multifamily loans

 

 

2,162,825

 

 

22,400

 

4.12

%

 

 

2,071,340

 

 

21,147

 

4.06

%

 

 

2,131,750

 

 

22,347

 

4.16

%

Non-owner occupied commercial real estate loans

 

 

1,491,170

 

 

21,770

 

5.81

%

 

 

1,411,533

 

 

21,065

 

5.94

%

 

 

1,392,684

 

 

20,686

 

5.89

%

Residential mortgages

 

 

535,833

 

 

6,301

 

4.68

%

 

 

525,285

 

 

6,082

 

4.61

%

 

 

526,422

 

 

5,942

 

4.48

%

Installment loans

 

 

1,023,569

 

 

25,474

 

9.90

%

 

 

1,029,812

 

 

24,228

 

9.36

%

 

 

1,198,043

 

 

26,568

 

8.80

%

Total loans and leases (4)

 

 

14,081,821

 

 

239,981

 

6.78

%

 

 

13,644,072

 

 

239,566

 

6.99

%

 

 

13,486,453

 

 

248,160

 

7.30

%

Other interest-earning assets

 

 

122,784

 

 

2,140

 

6.93

%

 

 

118,914

 

 

1,910

 

6.39

%

 

 

116,756

 

 

2,577

 

8.75

%

Total interest-earning assets

 

 

21,570,717

 

 

329,906

 

6.09

%

 

 

20,694,900

 

 

332,113

 

6.39

%

 

 

20,802,304

 

 

345,915

 

6.61

%

Non-interest-earning assets

 

 

609,253

 

 

 

 

 

 

535,504

 

 

 

 

 

 

449,969

 

 

 

 

Total assets

 

$

22,179,970

 

 

 

 

 

$

21,230,404

 

 

 

 

 

$

21,252,273

 

 

 

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest checking accounts

 

$

5,597,302

 

$

57,268

 

4.07

%

 

$

5,787,026

 

$

65,554

 

4.51

%

 

$

5,656,212

 

$

62,041

 

4.35

%

Money market deposit accounts

 

 

3,974,776

 

 

42,492

 

4.25

%

 

 

3,676,994

 

 

42,128

 

4.56

%

 

 

2,802,309

 

 

29,990

 

4.25

%

Other savings accounts

 

 

1,258,018

 

 

12,939

 

4.09

%

 

 

1,563,970

 

 

18,426

 

4.69

%

 

 

1,218,118

 

 

13,849

 

4.51

%

Certificates of deposit

 

 

2,612,246

 

 

32,275

 

4.92

%

 

 

2,339,937

 

 

29,721

 

5.05

%

 

 

3,625,311

 

 

44,427

 

4.86

%

Total interest-bearing deposits (5)

 

 

13,442,342

 

 

144,974

 

4.29

%

 

 

13,367,927

 

 

155,829

 

4.64

%

 

 

13,301,950

 

 

150,307

 

4.48

%

Borrowings

 

 

1,364,138

 

 

17,111

 

4.99

%

 

 

1,334,905

 

 

17,739

 

5.29

%

 

 

1,816,047

 

 

23,102

 

5.05

%

Total interest-bearing liabilities

 

 

14,806,480

 

 

162,085

 

4.36

%

 

 

14,702,832

 

 

173,568

 

4.70

%

 

 

15,117,997

 

 

173,409

 

4.55

%

Non-interest-bearing deposits (5)

 

 

5,346,912

 

 

 

 

 

 

4,557,815

 

 

 

 

 

 

4,270,557

 

 

 

 

Total deposits and borrowings

 

 

20,153,392

 

 

 

3.20

%

 

 

19,260,647

 

 

 

3.59

%

 

 

19,388,554

 

 

 

3.55

%

Other non-interest-bearing liabilities

 

 

204,947

 

 

 

 

 

 

195,722

 

 

 

 

 

 

276,198

 

 

 

 

Total liabilities

 

 

20,358,339

 

 

 

 

 

 

19,456,369

 

 

 

 

 

 

19,664,752

 

 

 

 

Shareholders’ equity

 

 

1,821,631

 

 

 

 

 

 

1,774,035

 

 

 

 

 

 

1,587,521

 

 

 

 

Total liabilities and shareholders’ equity

 

$

22,179,970

 

 

 

 

 

$

21,230,404

 

 

 

 

 

$

21,252,273

 

 

 

 

Net interest income

 

 

 

 

167,821

 

 

 

 

 

 

158,545

 

 

 

 

 

 

172,506

 

 

Tax-equivalent adjustment

 

 

 

 

377

 

 

 

 

 

 

392

 

 

 

 

 

 

398

 

 

Net interest earnings

 

 

 

$

168,198

 

 

 

 

 

$

158,937

 

 

 

 

 

$

172,904

 

 

Interest spread

 

 

 

 

 

2.89

%

 

 

 

 

 

2.80

%

 

 

 

 

 

3.06

%

Net interest margin

 

 

 

 

 

3.10

%

 

 

 

 

 

3.05

%

 

 

 

 

 

3.30

%

Net interest margin tax equivalent (6)

 

 

 

 

 

3.11

%

 

 

 

 

 

3.06

%

 

 

 

 

 

3.31

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) For presentation in this table, average balances and the corresponding average yields for investment securities are based upon historical cost, adjusted for amortization of premiums and accretion of discounts.

(2) Includes owner occupied commercial real estate loans.

(3) Includes PPP loans.

(4) Includes non-accrual loans, the effect of which is to reduce the yield earned on loans and leases, and deferred loan fees.

(5) Total costs of deposits (including interest bearing and non-interest bearing) were 3.07%, 3.46% and 3.39% for the three months ended December 31, 2024, September 30, 2024 and December 31, 2023, respectively.

(6) Tax-equivalent basis, using an estimated marginal tax rate of 26% for the three months ended December 31, 2024, September 30, 2024 and December 31, 2023, presented to approximate interest income as a taxable asset.

CUSTOMERS BANCORP, INC. AND SUBSIDIARIES

AVERAGE BALANCE SHEET / NET INTEREST MARGIN - UNAUDITED (CONTINUED)

(Dollars in thousands)

 

 

 

Twelve Months Ended

 

 

December 31, 2024

 

December 31, 2023

 

 

Average Balance

 

Interest Income or Expense

 

Average Yield or Cost (%)

 

Average Balance

 

Interest Income or Expense

 

Average Yield or Cost (%)

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Interest earning deposits

 

$

3,597,260

 

$

190,842

 

5.31

%

 

$

2,375,488

 

$

125,923

 

5.30

%

Investment securities (1)

 

 

3,650,320

 

 

180,291

 

4.94

%

 

 

4,057,564

 

 

200,659

 

4.95

%

Loans and leases:

 

 

 

 

 

 

 

 

 

 

 

 

Commercial & industrial:

 

 

 

 

 

 

 

 

 

 

 

 

Specialized lending loans and leases (2)

 

 

5,637,189

 

 

483,052

 

8.57

%

 

 

5,704,220

 

 

513,976

 

9.01

%

Other commercial & industrial loans (2)(3)

 

 

1,564,167

 

 

102,001

 

6.52

%

 

 

1,976,924

 

 

133,451

 

6.75

%

Mortgage finance loans

 

 

1,192,827

 

 

62,344

 

5.23

%

 

 

1,179,141

 

 

67,660

 

5.74

%

Multifamily loans

 

 

2,116,168

 

 

86,263

 

4.08

%

 

 

2,165,067

 

 

85,204

 

3.94

%

Non-owner occupied commercial real estate loans

 

 

1,412,201

 

 

83,484

 

5.91

%

 

 

1,423,929

 

 

81,970

 

5.76

%

Residential mortgages

 

 

526,133

 

 

24,046

 

4.57

%

 

 

533,213

 

 

23,240

 

4.36

%

Installment loans

 

 

1,104,470

 

 

106,340

 

9.63

%

 

 

1,437,078

 

 

127,237

 

8.85

%

Total loans and leases (4)

 

 

13,553,155

 

 

947,530

 

6.99

%

 

 

14,419,572

 

 

1,032,738

 

7.16

%

Other interest-earning assets

 

 

114,983

 

 

9,171

 

7.98

%

 

 

118,574

 

 

8,040

 

6.78

%

Total interest-earning assets

 

 

20,915,718

 

 

1,327,834

 

6.35

%

 

 

20,971,198

 

 

1,367,360

 

6.52

%

Non-interest-earning assets

 

 

518,472

 

 

 

 

 

 

515,185

 

 

 

 

Total assets

 

$

21,434,190

 

 

 

 

 

$

21,486,383

 

 

 

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

Interest checking accounts

 

$

5,660,890

 

$

248,400

 

4.39

%

 

$

6,048,797

 

$

241,025

 

3.98

%

Money market deposit accounts

 

 

3,559,362

 

 

159,598

 

4.48

%

 

 

2,358,437

 

 

93,434

 

3.96

%

Other savings accounts

 

 

1,595,357

 

 

73,947

 

4.64

%

 

 

1,029,951

 

 

41,556

 

4.03

%

Certificates of deposit

 

 

2,434,622

 

 

121,367

 

4.99

%

 

 

4,401,855

 

 

200,422

 

4.55

%

Total interest-bearing deposits (5)

 

 

13,250,231

 

 

603,312

 

4.55

%

 

 

13,839,040

 

 

576,437

 

4.17

%

Federal funds purchased

 

 

—

 

 

—

 

—

%

 

 

3,781

 

 

188

 

4.97

%

Borrowings

 

 

1,414,583

 

 

70,118

 

4.96

%

 

 

2,073,553

 

 

103,286

 

4.98

%

Total interest-bearing liabilities

 

 

14,664,814

 

 

673,430

 

4.59

%

 

 

15,916,374

 

 

679,911

 

4.27

%

Non-interest-bearing deposits (5)

 

 

4,807,647

 

 

 

 

 

 

3,801,053

 

 

 

 

Total deposits and borrowings

 

 

19,472,461

 

 

 

3.46

%

 

 

19,717,427

 

 

 

3.45

%

Other non-interest-bearing liabilities

 

 

217,172

 

 

 

 

 

 

272,599

 

 

 

 

Total liabilities

 

 

19,689,633

 

 

 

 

 

 

19,990,026

 

 

 

 

Shareholders’ equity

 

 

1,744,557

 

 

 

 

 

 

1,496,357

 

 

 

 

Total liabilities and shareholders’ equity

 

$

21,434,190

 

 

 

 

 

$

21,486,383

 

 

 

 

Net interest income

 

 

 

 

654,404

 

 

 

 

 

 

687,449

 

 

Tax-equivalent adjustment

 

 

 

 

1,556

 

 

 

 

 

 

1,568

 

 

Net interest earnings

 

 

 

$

655,960

 

 

 

 

 

$

689,017

 

 

Interest spread

 

 

 

 

 

2.89

%

 

 

 

 

 

3.07

%

Net interest margin

 

 

 

 

 

3.14

%

 

 

 

 

 

3.28

%

Net interest margin tax equivalent (6)

 

 

 

 

 

3.15

%

 

 

 

 

 

3.29

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) For presentation in this table, average balances and the corresponding average yields for investment securities are based upon historical cost, adjusted for amortization of premiums and accretion of discounts.

(2) Includes owner occupied commercial real estate loans.

(3) Includes PPP loans.

(4) Includes non-accrual loans, the effect of which is to reduce the yield earned on loans and leases, and deferred loan fees.

(5) Total costs of deposits (including interest bearing and non-interest bearing) were 3.34% and 3.27% for the twelve months ended December 31, 2024 and 2023, respectively.

(6) Tax-equivalent basis, using an estimated marginal tax rate of 26% for the twelve months ended December 31, 2024 and 2023, presented to approximate interest income as a taxable asset.

CUSTOMERS BANCORP, INC. AND SUBSIDIARIES

PERIOD END LOAN AND LEASE COMPOSITION - UNAUDITED

(Dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

December 31,

 

September 30,

 

June 30,

 

March 31,

 

December 31,

 

 

2024

 

2024

 

2024

 

2024

 

2023

Loans and leases held for investment

 

 

 

 

 

 

 

 

 

 

Commercial:

 

 

 

 

 

 

 

 

 

 

Commercial & industrial:

 

 

 

 

 

 

 

 

 

 

Specialized lending

 

$

5,842,420

 

$

5,468,507

 

$

5,528,745

 

$

5,104,405

 

$

5,006,693

Other commercial & industrial (1)

 

 

1,062,631

 

 

1,087,222

 

 

1,092,146

 

 

1,113,517

 

 

1,162,317

Mortgage finance

 

 

1,440,847

 

 

1,367,617

 

 

1,122,812

 

 

1,071,146

 

 

1,014,742

Multifamily

 

 

2,252,246

 

 

2,115,978

 

 

2,067,332

 

 

2,123,675

 

 

2,138,622

Commercial real estate owner occupied

 

 

1,100,944

 

 

981,904

 

 

805,779

 

 

806,278

 

 

797,319

Commercial real estate non-owner occupied

 

 

1,359,130

 

 

1,326,591

 

 

1,202,606

 

 

1,182,084

 

 

1,177,650

Construction

 

 

147,209

 

 

174,509

 

 

163,409

 

 

185,601

 

 

166,393

Total commercial loans and leases

 

 

13,205,427

 

 

12,522,328

 

 

11,982,829

 

 

11,586,706

 

 

11,463,736

Consumer:

 

 

 

 

 

 

 

 

 

 

Residential

 

 

496,559

 

 

500,786

 

 

481,503

 

 

482,537

 

 

484,435

Manufactured housing

 

 

33,123

 

 

34,481

 

 

35,901

 

 

37,382

 

 

38,670

Installment:

 

 

 

 

 

 

 

 

 

 

Personal

 

 

463,854

 

 

453,739

 

 

474,481

 

 

492,892

 

 

555,533

Other

 

 

249,799

 

 

266,362

 

 

282,201

 

 

299,714

 

 

319,393

Total installment loans

 

 

713,653

 

 

720,101

 

 

756,682

 

 

792,606

 

 

874,926

Total consumer loans

 

 

1,243,335

 

 

1,255,368

 

 

1,274,086

 

 

1,312,525

 

 

1,398,031

Total loans and leases held for investment

 

$

14,448,762

 

$

13,777,696

 

$

13,256,915

 

$

12,899,231

 

$

12,861,767

Loans held for sale

 

 

 

 

 

 

 

 

 

 

Residential

 

$

1,836

 

$

2,523

 

$

2,684

 

$

870

 

$

1,215

Installment:

 

 

 

 

 

 

 

 

 

 

Personal

 

 

40,903

 

 

55,799

 

 

125,598

 

 

137,755

 

 

151,040

Other

 

 

162,055

 

 

217,098

 

 

247,442

 

 

219,015

 

 

188,062

Total installment loans

 

 

202,958

 

 

272,897

 

 

373,040

 

 

356,770

 

 

339,102

Total loans held for sale

 

$

204,794

 

$

275,420

 

$

375,724

 

$

357,640

 

$

340,317

Total loans and leases portfolio

 

$

14,653,556

 

$

14,053,116

 

$

13,632,639

 

$

13,256,871

 

$

13,202,084

(1)

 

Includes PPP loans.

CUSTOMERS BANCORP, INC. AND SUBSIDIARIES

PERIOD END DEPOSIT COMPOSITION - UNAUDITED

(Dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

December 31,

 

September 30,

 

June 30,

 

March 31,

 

December 31,

 

 

2024

 

2024

 

2024

 

2024

 

2023

 

 

 

 

 

 

 

 

 

 

 

Demand, non-interest bearing

 

$

5,608,288

 

$

4,670,809

 

$

4,474,862

 

$

4,688,880

 

$

4,422,494

Demand, interest bearing

 

 

5,553,698

 

 

5,606,500

 

 

5,894,056

 

 

5,661,775

 

 

5,580,527

Total demand deposits

 

 

11,161,986

 

 

10,277,309

 

 

10,368,918

 

 

10,350,655

 

 

10,003,021

Savings

 

 

1,131,819

 

 

1,399,968

 

 

1,573,661

 

 

2,080,374

 

 

1,402,941

Money market

 

 

3,844,451

 

 

3,961,028

 

 

3,539,815

 

 

3,347,843

 

 

3,226,395

Time deposits

 

 

2,708,205

 

 

2,431,084

 

 

2,195,699

 

 

2,182,511

 

 

3,287,879

Total deposits

 

$

18,846,461

 

$

18,069,389

 

$

17,678,093

 

$

17,961,383

 

$

17,920,236

CUSTOMERS BANCORP, INC. AND SUBSIDIARIES

ASSET QUALITY - UNAUDITED

(Dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of December 31, 2024

 

As of September 30, 2024

 

As of December 31, 2023

Loan type

 

Total loans

 

Allowance for credit losses

 

Total reserves to total loans

 

Total loans

 

Allowance for credit losses

 

Total reserves to total loans

 

Total loans

 

Allowance for credit losses

 

Total reserves to total loans

Commercial:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial & industrial, including specialized lending (1)

 

$

7,024,770

 

$

29,379

 

0.42

%

 

$

6,672,933

 

$

25,191

 

0.38

%

 

$

6,285,840

 

$

23,503

 

0.37

%

Multifamily

 

 

2,252,246

 

 

18,511

 

0.82

%

 

 

2,115,978

 

 

18,090

 

0.85

%

 

 

2,138,622

 

 

16,343

 

0.76

%

Commercial real estate owner occupied

 

 

1,100,944

 

 

10,755

 

0.98

%

 

 

981,904

 

 

10,913

 

1.11

%

 

 

797,319

 

 

9,882

 

1.24

%

Commercial real estate non-owner occupied

 

 

1,359,130

 

 

17,405

 

1.28

%

 

 

1,326,591

 

 

17,303

 

1.30

%

 

 

1,177,650

 

 

16,859

 

1.43

%

Construction

 

 

147,209

 

 

1,250

 

0.85

%

 

 

174,509

 

 

1,606

 

0.92

%

 

 

166,393

 

 

1,482

 

0.89

%

Total commercial loans and leases receivable

 

 

11,884,299

 

 

77,300

 

0.65

%

 

 

11,271,915

 

 

73,103

 

0.65

%

 

 

10,565,824

 

 

68,069

 

0.64

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential

 

 

496,559

 

 

5,968

 

1.20

%

 

 

500,786

 

 

5,838

 

1.17

%

 

 

484,435

 

 

6,586

 

1.36

%

Manufactured housing

 

 

33,123

 

 

3,829

 

11.56

%

 

 

34,481

 

 

4,080

 

11.83

%

 

 

38,670

 

 

4,239

 

10.96

%

Installment

 

 

713,653

 

 

49,678

 

6.96

%

 

 

720,101

 

 

50,137

 

6.96

%

 

 

874,926

 

 

56,417

 

6.45

%

Total consumer loans receivable

 

 

1,243,335

 

 

59,475

 

4.78

%

 

 

1,255,368

 

 

60,055

 

4.78

%

 

 

1,398,031

 

 

67,242

 

4.81

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans and leases receivable held for investment

 

 

13,127,634

 

 

136,775

 

1.04

%

 

 

12,527,283

 

 

133,158

 

1.06

%

 

 

11,963,855

 

 

135,311

 

1.13

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans receivable, mortgage finance, at fair value

 

 

1,321,128

 

 

—

 

—

%

 

 

1,250,413

 

 

—

 

—

%

 

 

897,912

 

 

—

 

—

%

Loans held for sale

 

 

204,794

 

 

—

 

—

%

 

 

275,420

 

 

—

 

—

%

 

 

340,317

 

 

—

 

—

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total loans and leases portfolio

 

$

14,653,556

 

$

136,775

 

0.93

%

 

$

14,053,116

 

$

133,158

 

0.95

%

 

$

13,202,084

 

$

135,311

 

1.02

%

(1)

 

Includes PPP loans.

CUSTOMERS BANCORP, INC. AND SUBSIDIARIES

ASSET QUALITY - UNAUDITED

(Dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of December 31, 2024

 

As of September 30, 2024

 

As of December 31, 2023

Loan type

 

Non accrual /NPLs

 

Total NPLs to total loans

 

Total reserves to total NPLs

 

Non accrual /NPLs

 

Total NPLs to total loans

 

Total reserves to total NPLs

 

Non accrual /NPLs

 

Total NPLs to total loans

 

Total reserves to total NPLs

Commercial:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial & industrial, including specialized lending (1)

 

$

4,041

 

0.06

%

 

727.02

%

 

$

4,615

 

0.07

%

 

545.85

%

 

$

4,436

 

0.07

%

 

529.82

%

Multifamily

 

 

11,834

 

0.53

%

 

156.42

%

 

 

11,834

 

0.56

%

 

152.86

%

 

 

—

 

—

%

 

—

%

Commercial real estate owner occupied

 

 

8,090

 

0.73

%

 

132.94

%

 

 

8,613

 

0.88

%

 

126.70

%

 

 

5,869

 

0.74

%

 

168.38

%

Commercial real estate non-owner occupied

 

 

354

 

0.03

%

 

4916.67

%

 

 

763

 

0.06

%

 

2267.76

%

 

 

—

 

—

%

 

—

%

Construction

 

 

—

 

—

%

 

—

%

 

 

—

 

—

%

 

—

%

 

 

—

 

—

%

 

—

%

Total commercial loans and leases receivable

 

 

24,319

 

0.20

%

 

317.86

%

 

 

25,825

 

0.23

%

 

283.07

%

 

 

10,305

 

0.10

%

 

660.54

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential

 

 

8,714

 

1.75

%

 

68.49

%

 

 

7,997

 

1.60

%

 

73.00

%

 

 

6,802

 

1.40

%

 

96.82

%

Manufactured housing

 

 

1,852

 

5.59

%

 

206.75

%

 

 

1,869

 

5.42

%

 

218.30

%

 

 

2,331

 

6.03

%

 

181.85

%

Installment

 

 

5,613

 

0.79

%

 

885.05

%

 

 

6,328

 

0.88

%

 

792.30

%

 

 

7,211

 

0.82

%

 

782.37

%

Total consumer loans receivable

 

 

16,179

 

1.30

%

 

367.61

%

 

 

16,194

 

1.29

%

 

370.85

%

 

 

16,344

 

1.17

%

 

411.42

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans and leases receivable

 

 

40,498

 

0.31

%

 

337.73

%

 

 

42,019

 

0.34

%

 

316.90

%

 

 

26,649

 

0.22

%

 

507.75

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans receivable, mortgage finance, at fair value

 

 

—

 

—

%

 

—

%

 

 

—

 

—

%

 

—

%

 

 

—

 

—

%

 

—

%

Loans held for sale

 

 

2,777

 

1.36

%

 

—

%

 

 

5,307

 

1.93

%

 

—

%

 

 

461

 

0.14

%

 

—

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total loans and leases portfolio

 

$

43,275

 

0.30

%

 

316.06

%

 

$

47,326

 

0.34

%

 

281.36

%

 

$

27,110

 

0.21

%

 

499.12

%

(1)

 

Includes PPP loans.

CUSTOMERS BANCORP, INC. AND SUBSIDIARIES

NET CHARGE-OFFS/(RECOVERIES) - UNAUDITED

(Dollars in thousands)

 

 

 

 

Q4

 

Q3

 

Q2

 

Q1

 

Q4

 

Twelve Months Ended December 31,

 

 

2024

 

2024

 

2024

 

2024

 

2023

 

2024

 

2023

Loan type

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial & industrial, including specialized lending

 

$

3,653

 

 

$

5,056

 

 

$

5,665

 

 

$

3,672

 

$

5,282

 

 

$

18,046

 

 

$

8,443

 

Multifamily

 

 

—

 

 

 

2,167

 

 

 

1,433

 

 

 

473

 

 

127

 

 

 

4,073

 

 

 

3,574

 

Commercial real estate owner occupied

 

 

339

 

 

 

4

 

 

 

—

 

 

 

22

 

 

—

 

 

 

365

 

 

 

5

 

Commercial real estate non-owner occupied

 

 

145

 

 

 

—

 

 

 

—

 

 

 

—

 

 

(288

)

 

 

145

 

 

 

4,212

 

Construction

 

 

—

 

 

 

(3

)

 

 

(7

)

 

 

—

 

 

—

 

 

 

(10

)

 

 

(116

)

Residential

 

 

(18

)

 

 

(21

)

 

 

(20

)

 

 

18

 

 

(1

)

 

 

(41

)

 

 

34

 

Installment

 

 

10,493

 

 

 

9,841

 

 

 

11,640

 

 

 

13,783

 

 

12,202

 

 

 

45,757

 

 

 

52,883

 

Total net charge-offs (recoveries) from loans held for investment

 

$

14,612

 

 

$

17,044

 

 

$

18,711

 

 

$

17,968

 

$

17,322

 

 

$

68,335

 

 

$

69,035

CUSTOMERS BANCORP, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP MEASURES - UNAUDITED

 

We believe that the non-GAAP measurements disclosed within this document are useful for investors, regulators, management and others to evaluate our core results of operations and financial condition relative to other financial institutions. These non-GAAP financial measures are frequently used by securities analysts, investors, and other interested parties in the evaluation of companies in our industry. These non-GAAP financial measures exclude from corresponding GAAP measures the impact of certain elements that we do not believe are representative of our ongoing financial results, which we believe enhance an overall understanding of our performance and increases comparability of our period to period results. Investors should consider our performance and financial condition as reported under GAAP and all other relevant information when assessing our performance or financial condition. The non-GAAP measures presented are not necessarily comparable to non-GAAP measures that may be presented by other financial institutions. Although non-GAAP financial measures are frequently used in the evaluation of a company, they have limitations as analytical tools and should not be considered in isolation or as a substitute for analysis of our results of operations or financial condition as reported under GAAP.

 

The following tables present reconciliations of GAAP to non-GAAP measures disclosed within this document.

       

 

 

Twelve Months Ended

December 31,

Core Earnings and Adjusted Core Earnings - Customers Bancorp  

Q4 2024

 

Q3 2024

 

Q2 2024

 

Q1 2024

 

Q4 2023

 

2024

 

2023

(Dollars in thousands, except per share data)

 

USD

Per share

 

USD

Per share

 

USD

Per share

 

USD

Per share

 

USD

Per share

 

USD

Per share

 

USD

Per share

GAAP net income to common shareholders

 

$

23,266

 

$

0.71

 

 

$

42,937

 

$

1.31

 

 

$

54,300

 

$

1.66

 

 

$

45,926

$

1.40

 

$

58,223

 

$

1.79

 

$

166,429

 

$

5.09

 

 

$

235,448

$

7.32

Reconciling items (after tax):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Severance expense

 

 

1,198

 

 

0.04

 

 

 

540

 

 

0.02

 

 

 

1,928

 

 

0.06

 

 

 

—

 

—

 

 

473

 

 

0.01

 

 

3,666

 

 

0.11

 

 

 

1,251

 

0.04

Impairments on fixed assets and leases

 

 

—

 

 

—

 

 

 

—

 

 

—

 

 

 

—

 

 

—

 

 

 

—

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

 

98

 

0.00

Loss on sale of capital call lines of credit

 

 

—

 

 

—

 

 

 

—

 

 

—

 

 

 

—

 

 

—

 

 

 

—

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

 

3,914

 

0.12

Legal settlement

 

 

157

 

 

0.00

 

 

 

—

 

 

—

 

 

 

—

 

 

—

 

 

 

—

 

—

 

 

—

 

 

—

 

 

157

 

 

0.00

 

 

 

—

 

—

(Gains) losses on investment securities

 

 

20,035

 

 

0.62

 

 

 

(322

)

 

(0.01

)

 

 

561

 

 

0.02

 

 

 

57

 

0.00

 

 

(85

)

 

0.00

 

 

20,331

 

 

0.62

 

 

 

407

 

0.01

Derivative credit valuation adjustment

 

 

(306

)

 

(0.01

)

 

 

185

 

 

0.01

 

 

 

(44

)

 

0.00

 

 

 

169

 

0.01

 

 

267

 

 

0.01

 

 

4

 

 

0.00

 

 

 

219

 

0.01

Tax on surrender of bank-owned life insurance policies

 

 

—

 

 

—

 

 

 

—

 

 

—

 

 

 

—

 

 

—

 

 

 

—

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

 

4,141

 

0.13

FDIC special assessment

 

 

—

 

 

—

 

 

 

—

 

 

—

 

 

 

138

 

 

0.00

 

 

 

380

 

0.01

 

 

2,755

 

 

0.08

 

 

518

 

 

0.02

 

 

 

2,755

 

0.09

Unrealized (gain) on equity method investments

 

 

(292

)

 

(0.01

)

 

 

—

 

 

—

 

 

 

(8,316

)

 

(0.25

)

 

 

—

 

—

 

 

—

 

 

—

 

 

(8,608

)

 

(0.26

)

 

 

—

 

—

Unrealized losses on loans held for sale

 

 

110

 

 

0.00

 

 

 

498

 

 

0.02

 

 

 

—

 

 

—

 

 

 

—

 

—

 

 

—

 

 

—

 

 

608

 

 

0.02

 

 

 

—

 

—

Core earnings

 

$

44,168

 

$

1.36

 

 

$

43,838

 

$

1.34

 

 

$

48,567

 

$

1.49

 

 

$

46,532

$

1.42

 

$

61,633

 

$

1.90

 

$

183,105

 

$

5.60

 

 

$

248,233

$

7.72

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

One-time non-interest expense items recorded in 2024 (after-tax):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposit servicing fees prior to 2024

 

 

—

 

 

—

 

 

 

—

 

 

—

 

 

 

—

 

 

—

 

 

 

5,405

 

0.16

 

 

—

 

 

—

 

 

5,405

 

 

0.17

 

 

 

—

 

—

FDIC premiums prior to 2024

 

 

—

 

 

—

 

 

 

—

 

 

—

 

 

 

—

 

 

—

 

 

 

3,200

 

0.10

 

 

—

 

 

—

 

 

3,200

 

 

0.10

 

 

 

—

 

—

Non-income taxes prior to 2024

 

 

—

 

 

—

 

 

 

(2,457

)

 

(0.07

)

 

 

—

 

 

—

 

 

 

—

 

—

 

 

—

 

 

—

 

 

(2,457

)

 

(0.08

)

 

 

—

 

—

Total one-time non-interest expense items

 

 

—

 

 

—

 

 

 

(2,457

)

 

(0.07

)

 

 

—

 

 

—

 

 

 

8,605

 

0.26

 

 

—

 

 

—

 

 

6,148

 

 

0.19

 

 

 

—

 

—

Adjusted core earnings (adjusted for one-time non-interest expense items)

 

$

44,168

 

$

1.36

 

 

$

41,381

 

$

1.26

 

 

$

48,567

 

$

1.49

 

 

$

55,137

$

1.68

 

$

61,633

 

$

1.90

 

$

189,253

 

$

5.78

 

 

$

248,233

$

7.72

Core Return on Average Assets and Adjusted Core Return on Average Assets - Customers Bancorp

 

 

 

 

 

 

 

 

 

 

 

Twelve Months Ended

December 31,

(Dollars in thousands, except per share data)

 

Q4 2024

 

Q3 2024

 

Q2 2024

 

Q1 2024

 

Q4 2023

 

2024

 

2023

GAAP net income

 

$

26,915

 

 

$

46,743

 

 

$

58,085

 

 

$

49,726

 

 

$

62,092

 

 

$

181,469

 

 

$

250,143

 

Reconciling items (after tax):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Severance expense

 

 

1,198

 

 

 

540

 

 

 

1,928

 

 

 

—

 

 

 

473

 

 

 

3,666

 

 

 

1,251

 

Impairments on fixed assets and leases

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

98

 

Loss on sale of capital call lines of credit

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

3,914

 

Legal settlement

 

 

157

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

157

 

 

 

—

 

(Gains) losses on investment securities

 

 

20,035

 

 

 

(322

)

 

 

561

 

 

 

57

 

 

 

(85

)

 

 

20,331

 

 

 

407

 

Derivative credit valuation adjustment

 

 

(306

)

 

 

185

 

 

 

(44

)

 

 

169

 

 

 

267

 

 

 

4

 

 

 

219

 

Tax on surrender of bank-owned life insurance policies

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

4,141

 

FDIC special assessment

 

 

—

 

 

 

—

 

 

 

138

 

 

 

380

 

 

 

2,755

 

 

 

518

 

 

 

2,755

 

Unrealized (gain) on equity method investments

 

 

(292

)

 

 

—

 

 

 

(8,316

)

 

 

—

 

 

 

—

 

 

 

(8,608

)

 

 

—

 

Unrealized losses on loans held for sale

 

 

110

 

 

 

498

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

608

 

 

 

—

 

Core net income

 

$

47,817

 

 

$

47,644

 

 

$

52,352

 

 

$

50,332

 

 

$

65,502

 

 

$

198,145

 

 

$

262,928

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

One-time non-interest expense items recorded in 2024 (after-tax):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposit servicing fees prior to 2024

 

 

—

 

 

 

—

 

 

 

—

 

 

 

5,405

 

 

 

—

 

 

 

5,405

 

 

 

—

 

FDIC premiums prior to 2024

 

 

—

 

 

 

—

 

 

 

—

 

 

 

3,200

 

 

 

—

 

 

 

3,200

 

 

 

—

 

Non-income taxes prior to 2024

 

 

—

 

 

 

(2,457

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(2,457

)

 

 

—

 

Total one-time non-interest expense items

 

 

—

 

 

 

(2,457

)

 

 

—

 

 

 

8,605

 

 

 

—

 

 

 

6,148

 

 

 

—

 

Adjusted core net income (adjusted for one-time non-interest expense items)

 

$

47,817

 

 

$

45,187

 

 

$

52,352

 

 

$

58,937

 

 

$

65,502

 

 

$

204,293

 

 

$

262,928

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average total assets

 

$

22,179,970

 

 

$

21,230,404

 

 

$

20,985,203

 

 

$

21,335,229

 

 

$

21,252,273

 

 

$

21,434,190

 

 

$

21,486,383

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Core return on average assets

 

 

0.86

%

 

 

0.89

%

 

 

1.00

%

 

 

0.95

%

 

 

1.22

%

 

 

0.92

%

 

 

1.22

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted core return on average assets (adjusted for one-time non-interest expense items)

 

 

0.86

%

 

 

0.85

%

 

 

1.00

%

 

 

1.11

%

 

 

1.22

%

 

 

0.95

%

 

 

1.22

%

Core Pre-Tax Pre-Provision Net Income and ROAA and Adjusted Core Pre-Tax Pre-Provision Net Income and ROAA - Customers Bancorp

 

 

 

 

 

 

 

 

 

 

 

Twelve Months Ended

December 31,

(Dollars in thousands, except per share data)

 

Q4 2024

 

Q3 2024

 

Q2 2024

 

Q1 2024

 

Q4 2023

 

2024

 

2023

GAAP net income

 

$

26,915

 

 

$

46,743

 

 

$

58,085

 

 

$

49,726

 

 

$

62,092

 

 

$

181,469

 

 

$

250,143

 

Reconciling items:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax expense (benefit)

 

 

8,946

 

 

 

(725

)

 

 

19,032

 

 

 

15,651

 

 

 

21,796

 

 

 

42,904

 

 

 

80,597

 

Provision (benefit) for credit losses

 

 

21,194

 

 

 

17,066

 

 

 

18,121

 

 

 

17,070

 

 

 

13,523

 

 

 

73,451

 

 

 

74,611

 

Provision (benefit) for credit losses on unfunded commitments

 

 

(664

)

 

 

642

 

 

 

1,594

 

 

 

430

 

 

 

(136

)

 

 

2,002

 

 

 

(112

)

Severance expense

 

 

1,595

 

 

 

659

 

 

 

2,560

 

 

 

—

 

 

 

639

 

 

 

4,814

 

 

 

1,630

 

Impairments on fixed assets and leases

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

124

 

Loss on sale of capital call lines of credit

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

5,037

 

Legal settlement

 

 

209

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

209

 

 

 

—

 

(Gains) losses on investment securities

 

 

26,678

 

 

 

(394

)

 

 

744

 

 

 

75

 

 

 

(114

)

 

 

27,103

 

 

 

512

 

Derivative credit valuation adjustment

 

 

(407

)

 

 

226

 

 

 

(58

)

 

 

222

 

 

 

361

 

 

 

(17

)

 

 

298

 

FDIC special assessment

 

 

—

 

 

 

—

 

 

 

183

 

 

 

500

 

 

 

3,723

 

 

 

683

 

 

 

3,723

 

Unrealized (gain) on equity method investments

 

 

(389

)

 

 

—

 

 

 

(11,041

)

 

 

—

 

 

 

—

 

 

 

(11,430

)

 

 

—

 

Unrealized losses on loans held for sale

 

 

147

 

 

 

607

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

754

 

 

 

—

 

Core pre-tax pre-provision net income

 

$

84,224

 

 

$

64,824

 

 

$

89,220

 

 

$

83,674

 

 

$

101,884

 

 

$

321,942

 

 

$

416,563

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

One-time non-interest expense items recorded in 2024 (after-tax):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposit servicing fees prior to 2024

 

 

—

 

 

 

—

 

 

 

—

 

 

 

7,106

 

 

 

—

 

 

 

7,106

 

 

 

—

 

FDIC premiums prior to 2024

 

 

—

 

 

 

—

 

 

 

—

 

 

 

4,208

 

 

 

—

 

 

 

4,208

 

 

 

—

 

Non-income taxes prior to 2024

 

 

—

 

 

 

(2,997

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(2,997

)

 

 

—

 

Total one-time non-interest expense items

 

 

—

 

 

 

(2,997

)

 

 

—

 

 

 

11,314

 

 

 

—

 

 

 

8,317

 

 

 

—

 

Adjusted core pre-tax pre-provision net income (adjusted for one-time non-interest expense items)

 

$

84,224

 

 

$

61,827

 

 

$

89,220

 

 

$

94,988

 

 

$

101,884

 

 

$

330,259

 

 

$

416,563

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average total assets

 

$

22,179,970

 

 

$

21,230,404

 

 

$

20,985,203

 

 

$

21,335,229

 

 

$

21,252,273

 

 

$

21,434,190

 

 

$

21,486,383

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Core pre-tax pre-provision ROAA

 

 

1.51

%

 

 

1.21

%

 

 

1.71

%

 

 

1.58

%

 

 

1.90

%

 

 

1.50

%

 

 

1.94

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted core pre-tax pre-provision ROAA (adjusted for one-time non-interest expense items)

 

 

1.51

%

 

 

1.16

%

 

 

1.71

%

 

 

1.79

%

 

 

1.90

%

 

 

1.54

%

 

 

 

1.94

%

Core Return on Average Common Equity and Adjusted Core Return on Average Common Equity - Customers Bancorp

 

 

 

 

 

 

 

 

 

 

 

Twelve Months Ended

December 31,

(Dollars in thousands, except per share data)

 

Q4 2024

 

Q3 2024

 

Q2 2024

 

Q1 2024

 

Q4 2023

 

2024

 

2023

GAAP net income to common shareholders

 

$

23,266

 

 

$

42,937

 

 

$

54,300

 

 

$

45,926

 

 

$

58,223

 

 

$

166,429

 

 

$

235,448

 

Reconciling items (after tax):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Severance expense

 

 

1,198

 

 

 

540

 

 

 

1,928

 

 

 

—

 

 

 

473

 

 

 

3,666

 

 

 

1,251

 

Impairments on fixed assets and leases

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

98

 

Loss on sale of capital call lines of credit

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

3,914

 

Legal settlement

 

 

157

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

157

 

 

 

—

 

(Gains) losses on investment securities

 

 

20,035

 

 

 

(322

)

 

 

561

 

 

 

57

 

 

 

(85

)

 

 

20,331

 

 

 

407

 

Derivative credit valuation adjustment

 

 

(306

)

 

 

185

 

 

 

(44

)

 

 

169

 

 

 

267

 

 

 

4

 

 

 

219

 

Tax on surrender of bank-owned life insurance policies

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

4,141

 

FDIC special assessment

 

 

—

 

 

 

—

 

 

 

138

 

 

 

380

 

 

 

2,755

 

 

 

518

 

 

 

2,755

 

Unrealized (gain) on equity method investments

 

 

(292

)

 

 

—

 

 

 

(8,316

)

 

 

—

 

 

 

—

 

 

 

(8,608

)

 

 

—

 

Unrealized losses on loans held for sale

 

 

110

 

 

 

498

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

608

 

 

 

—

 

Core earnings

 

$

44,168

 

 

$

43,838

 

 

$

48,567

 

 

$

46,532

 

 

$

61,633

 

 

$

183,105

 

 

$

248,233

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

One-time non-interest expense items recorded in 2024 (after-tax):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposit servicing fees prior to 2024

 

 

—

 

 

 

—

 

 

 

—

 

 

 

5,405

 

 

 

—

 

 

 

5,405

 

 

 

—

 

FDIC premiums prior to 2024

 

 

—

 

 

 

—

 

 

 

—

 

 

 

3,200

 

 

 

—

 

 

 

3,200

 

 

 

—

 

Non-income taxes prior to 2024

 

 

—

 

 

 

(2,457

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(2,457

)

 

 

—

 

Total one-time non-interest expense items

 

 

—

 

 

 

(2,457

)

 

 

—

 

 

 

8,605

 

 

 

—

 

 

 

6,148

 

 

 

—

 

Adjusted core earnings (adjusted for one-time non-interest expense items)

 

$

44,168

 

 

$

41,381

 

 

$

48,567

 

 

$

55,137

 

 

$

61,633

 

 

$

189,253

 

 

$

248,233

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average total common shareholders’ equity

 

$

1,683,838

 

 

$

1,636,242

 

 

$

1,576,595

 

 

$

1,529,211

 

 

$

1,449,728

 

 

$

1,606,764

 

 

$

1,358,564

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Core return on average common equity

 

 

10.44

%

 

 

10.66

%

 

 

12.39

%

 

 

12.24

%

 

 

16.87

%

 

 

11.40

%

 

 

18.27

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted core return on average common equity (adjusted for one-time non-interest expense items)

 

 

10.44

%

 

 

10.06

%

 

 

12.39

%

 

 

14.50

%

 

 

16.87

%

 

 

11.78

%

 

 

18.27

%

Core Pre-Tax Pre-Provision ROCE and Adjusted Core Pre-Tax Pre-Provision ROCE - Customers Bancorp

 

 

 

 

 

 

 

 

 

 

 

Twelve Months Ended

December 31,

(Dollars in thousands, except per share data)

 

Q4 2024

 

Q3 2024

 

Q2 2024

 

Q1 2024

 

Q4 2023

 

2024

 

2023

GAAP net income to common shareholders

 

$

23,266

 

 

$

42,937

 

 

$

54,300

 

 

$

45,926

 

 

$

58,223

 

 

$

166,429

 

 

$

235,448

 

Reconciling items:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax expense (benefit)

 

 

8,946

 

 

 

(725

)

 

 

19,032

 

 

 

15,651

 

 

 

21,796

 

 

 

42,904

 

 

 

80,597

 

Provision (benefit) for credit losses

 

 

21,194

 

 

 

17,066

 

 

 

18,121

 

 

 

17,070

 

 

 

13,523

 

 

 

73,451

 

 

 

74,611

 

Provision (benefit) for credit losses on unfunded commitments

 

 

(664

)

 

 

642

 

 

 

1,594

 

 

 

430

 

 

 

(136

)

 

 

2,002

 

 

 

(112

)

Severance expense

 

 

1,595

 

 

 

659

 

 

 

2,560

 

 

 

—

 

 

 

639

 

 

 

4,814

 

 

 

1,630

 

Impairments on fixed assets and leases

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

124

 

Loss on sale of capital call lines of credit

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

5,037

 

Legal settlement

 

 

209

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

209

 

 

 

—

 

(Gains) losses on investment securities

 

 

26,678

 

 

 

(394

)

 

 

744

 

 

 

75

 

 

 

(114

)

 

 

27,103

 

 

 

512

 

Derivative credit valuation adjustment

 

 

(407

)

 

 

226

 

 

 

(58

)

 

 

222

 

 

 

361

 

 

 

(17

)

 

 

298

 

FDIC special assessment

 

 

—

 

 

 

—

 

 

 

183

 

 

 

500

 

 

 

3,723

 

 

 

683

 

 

 

3,723

 

Unrealized (gain) on equity method investments

 

 

(389

)

 

 

—

 

 

 

(11,041

)

 

 

—

 

 

 

—

 

 

 

(11,430

)

 

 

—

 

Unrealized losses on loans held for sale

 

 

147

 

 

 

607

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

754

 

 

 

—

 

Core pre-tax pre-provision net income available to common shareholders

 

$

80,575

 

 

$

61,018

 

 

$

85,435

 

 

$

79,874

 

 

$

98,015

 

 

$

306,902

 

 

$

401,868

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

One-time non-interest expense items recorded in 2024 (after-tax):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposit servicing fees prior to 2024

 

 

—

 

 

 

—

 

 

 

—

 

 

 

7,106

 

 

 

—

 

 

 

7,106

 

 

 

—

 

FDIC premiums prior to 2024

 

 

—

 

 

 

—

 

 

 

—

 

 

 

4,208

 

 

 

—

 

 

 

4,208

 

 

 

—

 

Non-income taxes prior to 2024

 

 

—

 

 

 

(2,997

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(2,997

)

 

 

—

 

Total one-time non-interest expense items

 

 

—

 

 

 

(2,997

)

 

 

—

 

 

 

11,314

 

 

 

—

 

 

 

8,317

 

 

 

—

 

Adjusted core pre-tax pre-provision net income available to common shareholders

 

$

80,575

 

 

$

58,021

 

 

$

85,435

 

 

$

91,188

 

 

$

98,015

 

 

$

315,219

 

 

$

401,868

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average total common shareholders’ equity

 

$

1,683,838

 

 

$

1,636,242

 

 

$

1,576,595

 

 

$

1,529,211

 

 

$

1,449,728

 

 

$

1,606,764

 

 

$

1,358,564

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Core pre-tax pre-provision ROCE

 

 

19.04

%

 

 

14.84

%

 

 

21.79

%

 

 

21.01

%

 

 

26.82

%

 

 

19.10

%

 

 

29.58

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted core pre-tax pre-provision ROCE (adjusted for one-time non-interest expense items)

 

 

19.04

%

 

 

14.11

%

 

 

21.79

%

 

 

23.98

%

 

 

26.82

%

 

 

19.62

%

 

 

 

29.58

%

Core Efficiency Ratio and Adjusted Core Efficiency Ratio - Customers Bancorp

 

 

 

 

 

 

 

 

 

 

 

Twelve Months Ended

December 31,

(Dollars in thousands, except per share data)

 

Q4 2024

 

Q3 2024

 

Q2 2024

 

Q1 2024

 

Q4 2023

 

2024

 

2023

GAAP net interest income

 

$

167,821

 

 

$

158,545

 

 

$

167,653

 

 

$

160,385

 

 

$

172,506

 

 

$

654,404

 

 

$

687,449

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP non-interest income

 

$

(391

)

 

$

8,557

 

 

$

31,037

 

 

$

21,231

 

 

$

18,672

 

 

$

60,434

 

 

$

70,565

 

Loss on sale of capital call lines of credit

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

5,037

 

(Gains) losses on investment securities

 

 

26,678

 

 

 

(394

)

 

 

744

 

 

 

75

 

 

 

(114

)

 

 

27,103

 

 

 

512

 

Derivative credit valuation adjustment

 

 

(407

)

 

 

226

 

 

 

(58

)

 

 

222

 

 

 

361

 

 

 

(17

)

 

 

298

 

Unrealized (gain) on equity method investments

 

 

(389

)

 

 

—

 

 

 

(11,041

)

 

 

—

 

 

 

—

 

 

 

(11,430

)

 

 

—

 

Unrealized losses on loans held for sale

 

 

147

 

 

 

607

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

754

 

 

 

—

 

Core non-interest income

 

 

25,638

 

 

 

8,996

 

 

 

20,682

 

 

 

21,528

 

 

 

18,919

 

 

 

76,844

 

 

 

76,412

 

Core revenue

 

$

193,459

 

 

$

167,541

 

 

$

188,335

 

 

$

181,913

 

 

$

191,425

 

 

$

731,248

 

 

$

763,861

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP non-interest expense

 

$

110,375

 

 

$

104,018

 

 

$

103,452

 

 

$

99,169

 

 

$

93,767

 

 

$

417,014

 

 

$

352,663

 

Severance expense

 

 

(1,595

)

 

 

(659

)

 

 

(2,560

)

 

 

—

 

 

 

(639

)

 

 

(4,814

)

 

 

(1,630

)

Impairments on fixed assets and leases

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(124

)

FDIC special assessment

 

 

—

 

 

 

—

 

 

 

(183

)

 

 

(500

)

 

 

(3,723

)

 

 

(683

)

 

 

(3,723

)

Legal settlement

 

 

(209

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(209

)

 

 

—

 

Core non-interest expense

 

$

108,571

 

 

$

103,359

 

 

$

100,709

 

 

$

98,669

 

 

$

89,405

 

 

$

411,308

 

 

$

347,186

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

One-time non-interest expense items recorded in 2024:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposit servicing fees prior to 2024

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(7,106

)

 

 

—

 

 

 

(7,106

)

 

 

—

 

FDIC premiums prior to 2024

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(4,208

)

 

 

—

 

 

 

(4,208

)

 

 

—

 

Non-income taxes prior to 2024

 

 

—

 

 

 

2,997

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

2,997

 

 

 

—

 

Total one-time non-interest expense items

 

 

—

 

 

 

2,997

 

 

 

—

 

 

 

(11,314

)

 

 

—

 

 

 

(8,317

)

 

 

—

 

Adjusted core non-interest expense

 

$

108,571

 

 

$

106,356

 

 

$

100,709

 

 

$

87,355

 

 

$

89,405

 

 

$

402,991

 

 

$

347,186

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Core efficiency ratio (1)

 

 

56.12

%

 

 

61.69

%

 

 

53.47

%

 

 

54.24

%

 

 

46.70

%

 

 

56.25

%

 

 

45.45

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted core efficiency ratio (adjusted for one-time non-interest expense items) (2)

 

 

56.12

%

 

 

63.48

%

 

 

53.47

%

 

 

48.02

%

 

 

46.70

%

 

 

55.11

%

 

 

45.45

%

(1)

 

Core efficiency ratio calculated as core non-interest expense divided by core revenue.

(2)

 

Adjusted core efficiency ratio calculated as adjusted core non-interest expense divided by core revenue.

Core Non-Interest Expense to Average Total Assets and Adjusted Core Non-Interest Expense to Average Total Assets- Customers Bancorp

 

 

 

 

 

 

 

 

 

 

 

Twelve Months Ended

December 31,

(Dollars in thousands, except per share data)

 

Q4 2024

 

Q3 2024

 

Q2 2024

 

Q1 2024

 

Q4 2023

 

2024

 

2023

GAAP non-interest expense

 

$

110,375

 

 

$

104,018

 

 

$

103,452

 

 

$

99,169

 

 

$

93,767

 

 

$

417,014

 

 

$

352,663

 

Severance expense

 

 

(1,595

)

 

 

(659

)

 

 

(2,560

)

 

 

—

 

 

 

(639

)

 

 

(4,814

)

 

 

(1,630

)

Impairments on fixed assets and leases

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(124

)

FDIC special assessment

 

 

—

 

 

 

—

 

 

 

(183

)

 

 

(500

)

 

 

(3,723

)

 

 

(683

)

 

 

(3,723

)

Legal settlement

 

 

(209

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(209

)

 

 

—

 

Core non-interest expense

 

$

108,571

 

 

$

103,359

 

 

$

100,709

 

 

$

98,669

 

 

$

89,405

 

 

$

411,308

 

 

$

347,186

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

One-time non-interest expense items recorded in 2024:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposit servicing fees prior to 2024

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(7,106

)

 

 

—

 

 

 

(7,106

)

 

 

—

 

FDIC premiums prior to 2024

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(4,208

)

 

 

—

 

 

 

(4,208

)

 

 

—

 

Non-income taxes prior to 2024

 

 

—

 

 

 

2,997

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

2,997

 

 

 

—

 

Total one-time non-interest expense items

 

 

—

 

 

 

2,997

 

 

 

—

 

 

 

(11,314

)

 

 

—

 

 

 

(8,317

)

 

 

—

 

Adjusted core non-interest expense

 

$

108,571

 

 

$

106,356

 

 

$

100,709

 

 

$

87,355

 

 

$

89,405

 

 

$

402,991

 

 

$

347,186

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average total assets

 

$

22,179,970

 

 

$

21,230,404

 

 

$

20,985,203

 

 

$

21,335,229

 

 

$

21,252,273

 

 

$

21,434,190

 

 

$

21,486,383

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Core non-interest expense to average total assets

 

 

1.95

%

 

 

1.94

%

 

 

1.93

%

 

 

1.86

%

 

 

1.67

%

 

 

1.92

%

 

 

1.62

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted core non-interest expense to average total assets (adjusted for one-time non-interest expense items)

 

 

1.95

%

 

 

1.99

%

 

 

1.93

%

 

 

1.65

%

 

 

1.67

%

 

 

1.88

%

 

 

1.62

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tangible Common Equity to Tangible Assets - Customers Bancorp

 

 

 

 

 

(Dollars in thousands, except per share data)

 

Q4 2024

 

Q3 2024

 

Q2 2024

 

Q1 2024

 

Q4 2023

GAAP total shareholders’ equity

 

$

1,836,683

 

 

$

1,801,180

 

 

$

1,746,865

 

 

$

1,691,617

 

 

$

1,638,394

 

Reconciling items:

 

 

 

 

 

 

 

 

 

 

Preferred stock

 

 

(137,794

)

 

 

(137,794

)

 

 

(137,794

)

 

 

(137,794

)

 

 

(137,794

)

Goodwill and other intangibles

 

 

(3,629

)

 

 

(3,629

)

 

 

(3,629

)

 

 

(3,629

)

 

 

(3,629

)

Tangible common equity

 

$

1,695,260

 

 

$

1,659,757

 

 

$

1,605,442

 

 

$

1,550,194

 

 

$

1,496,971

 

 

 

 

 

 

 

 

 

 

 

 

GAAP total assets

 

$

22,308,241

 

 

$

21,456,082

 

 

$

20,942,975

 

 

$

21,347,367

 

 

$

21,316,265

 

Reconciling items:

 

 

 

 

 

 

 

 

 

 

Goodwill and other intangibles

 

 

(3,629

)

 

 

(3,629

)

 

 

(3,629

)

 

 

(3,629

)

 

 

(3,629

)

Tangible assets

 

$

22,304,612

 

 

$

21,452,453

 

 

$

20,939,346

 

 

$

21,343,738

 

 

$

21,312,636

 

 

 

 

 

 

 

 

 

 

 

 

Tangible common equity to tangible assets

 

 

7.6

%

 

 

7.7

%

 

 

7.7

%

 

 

7.3

%

 

 

7.0

%

Tangible Book Value per Common Share - Customers Bancorp

 

 

 

 

 

(Dollars in thousands, except share and per share data)

 

Q4 2024

 

Q3 2024

 

Q2 2024

 

Q1 2024

 

Q4 2023

GAAP total shareholders’ equity

 

$

1,836,683

 

 

$

1,801,180

 

 

$

1,746,865

 

 

$

1,691,617

 

 

$

1,638,394

 

Reconciling Items:

 

 

 

 

 

 

 

 

 

 

Preferred stock

 

 

(137,794

)

 

 

(137,794

)

 

 

(137,794

)

 

 

(137,794

)

 

 

(137,794

)

Goodwill and other intangibles

 

 

(3,629

)

 

 

(3,629

)

 

 

(3,629

)

 

 

(3,629

)

 

 

(3,629

)

Tangible common equity

 

$

1,695,260

 

 

$

1,659,757

 

 

$

1,605,442

 

 

$

1,550,194

 

 

$

1,496,971

 

 

 

 

 

 

 

 

 

 

 

 

Common shares outstanding

 

 

31,346,507

 

 

 

31,342,107

 

 

 

31,667,655

 

 

 

31,521,931

 

 

 

31,440,906

 

 

 

 

 

 

 

 

 

 

 

 

Tangible book value per common share

 

$

54.08

 

 

$

52.96

 

 

$

50.70

 

 

$

49.18

 

 

$

47.61

 

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20250122783498/en/

Jordan Baucum, Head of Corporate Communications 951-608-8314