0001381668FALSE00013816682024-01-302024-01-30

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 8-K
 
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) July 30, 2024
TFS FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)
 
United States of America 001-33390 52-2054948
(State or other jurisdiction
of incorporation)		 (Commission
File Number)		 (IRS Employer
Identification No.)
7007 Broadway Ave.,Cleveland,Ohio44105
(Address of principle executive offices)(Zip Code)
Registrant's telephone number, including area code (216) 441-6000
Not applicable
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act
Title of each classTrading Symbol(s)Name of each exchange in which registered
Common Stock, par value $0.01 per shareTFSLThe NASDAQ Stock Market, LLC
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging Growth Company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o


Item 2.02Results of Operations and Financial Condition.
On July 30, 2024, TFS Financial Corporation (the "Company”), the holding company for Third Federal Savings and Loan Association of Cleveland (the "Association"), issued a press release announcing its operating results for the three months and fiscal year ended June 30, 2024. A copy of the press release is attached as Exhibit 99.1 to this Report.
The information contained in this Item 2.02 and in the accompanying exhibit 99.1 shall not be incorporated by reference into any filing of the Company, whether made before or after the date hereof. The information in this report, including the exhibit hereto, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section or Sections 11 and 12(a)(2) of the Securities Act of 1933, as amended.


Item 9.01Financial Statements and Exhibits.

 (d) Exhibits.    
104        Cover Page Interactive Data File (embedded within the Inline XBRL document)



SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
  
TFS FINANCIAL CORPORATION
(Registrant)
Date:July 30, 2024  By: /s/ Meredith S. Weil
   Meredith S. Weil
   Chief Financial Officer



Contact: Jennifer Rosa         (216) 429-5037 Exhibit 99.1
For release July 30, 2024

TFS Financial Sees Positives Continue in Third Fiscal Quarter
(Cleveland, OH - July 30, 2024) - TFS Financial Corporation (NASDAQ: TFSL) (the "Company"), the holding company for Third Federal Savings and Loan Association of Cleveland (the "Association"), today announced results for the quarter and nine months ended June 30, 2024.
The Company reported net income of $20.0 million for the quarter ended June 30, 2024 compared to $20.7 million of net income for the quarter ended March 31, 2024. The change in net income included decreases in net interest income and release of provision for credit losses partially offset by a decrease in non-interest expense.
“Despite higher interest rates and economic uncertainty, our earnings are more than 10% higher this year than last year,” said Chairman and CEO Marc A. Stefanski. “Retail deposit growth of 6% in the last three months is a result of our strong CD product offerings. Our $2.2 billion in loan originations have an average yield of 7.31%, and our ongoing expense management resulted in a 5% reduction from 2023. All of our capital ratios continue to exceed the amounts required to be well capitalized, including a Tier I capital ratio of nearly 11%, further showing that we are strong, stable, and safe.”
Net interest income decreased $2.1 million, or 3%, to $69.3 million for the quarter ended June 30, 2024 from $71.4 million for the quarter ended March 31, 2024. Net interest income was lower as the weighted average cost of interest-bearing liabilities increased. Certificates of deposit and borrowings that were obtained in a lower interest rate environment matured during the quarter and were replaced by instruments with higher costs. The weighted average yield of interest-earning assets, primarily loans, increased during the quarter. The interest rate spread was 1.36% for the quarter ended June 30, 2024 compared to 1.43% for the quarter ended March 31, 2024. The net interest margin was 1.67% for the quarter ended June 30, 2024 compared to 1.71% for the prior quarter.
During the quarter ended June 30, 2024, there was a $0.5 million release of provision for credit losses compared to a $1.0 million release of provision for the quarter ended March 31, 2024. Continued recoveries of loan amounts previously charged off and low levels of current loan charge-offs resulted in the release of provision. Net recoveries were $1.4 million for the quarter ended June 30, 2024 compared to $1.3 million for the previous quarter. The total allowance for credit losses increased $0.9 million during the quarter ended June 30, 2024 to $95.7 million, or 0.63% of total loans receivable from $94.8 million, or 0.63% of total loans receivable, at March 31, 2024. The increase was mainly due to an increase in off- balance sheet commitments related to commitments to originate and undrawn portions of home equity lines of credit. The total allowance for credit losses included a liability for unfunded commitments of $28.2 million and $26.7 million at June 30, 2024 and March 31, 2024, respectively.
Total non-interest expense decreased $1.4 million, or 3%, to $50.8 million for the quarter ended June 30, 2024 from $52.2 million for the quarter ended March 31, 2024. There was a decrease of $0.7 million in both salaries and employee benefits and federal ("FDIC") insurance premium. Contributing to the decrease in salaries and employee benefits was a decrease in expense recognized for the Company's equity incentive plan, as certain grants fully vested during the previous quarter, and an increase in salary deferrals related to loan origination activities during the quarter. The decrease in FDIC premium was primarily due to an amendment to the FDIC's risk-based assessment that incorporated recent changes in accounting for and measurement of troubled debt restructurings ("TDRs").
Total assets increased by $17.8 million, or less than 1%, to $17.03 billion at June 30, 2024 from $17.02 billion at March 31, 2024. The increase was mainly due to increases in loans held for sale and loans held for investment partially offset by decreases in cash and cash equivalents and Federal Home Loan Bank ("FHLB") stock.
Cash and cash equivalents decreased $33.9 million, or less than 1%, to $560.4 million at June 30, 2024 from $594.3 million at March 31, 2024 due to normal fluctuations and liquidity management.
FHLB stock decreased $8.3 million to $232.1 million at June 30, 2024 from $240.4 million at March 31, 2024. The decrease is a result of stock redemptions by the FHLB related to a decrease in the balance of FHLB advances. The FHLB has collateral requirements on funds borrowed that dictate the minimum amount of stock owned at any given time.
Loans held for sale increased $20.7 million, or 213%, to $30.4 million at June 30, 2024 from $9.7 million at March 31, 2024 due to an increase in both loans committed to forward sales and loans identified for future sale.
Loans held for investment, net of allowance and deferred loan expenses, increased $40.3 million, or less than 1%, to $15.19 billion at June 30, 2024 from $15.15 billion at March 31, 2024. During the quarter ended June 30, 2024, the home equity loans and lines of credit portfolio increased $269.2 million and residential core mortgage loans decreased $225.3 million. Repayments and sales of residential mortgage loans held for investment outpaced originations during the quarter ended June 30,


2024. The volume of mortgage loan originations remains low due to a relatively high interest rate environment, resulting in minimal refinance activity.
Deposits increased by $90.3 million to $10.03 billion at June 30, 2024, compared to $9.94 billion at March 31, 2024, consisting of a $226.4 million increase in certificates of deposit ("CDs") and decreases of $79.8 million in savings accounts, $31.5 million in money market deposit accounts, and $25.6 million in checking accounts.
Borrowed funds decreased $126.1 million to $4.83 billion at June 30, 2024 from $4.96 billion at March 31, 2024, as maturing borrowings were paid off with cash and partially replaced with retail deposits.
Fiscal Year-To-Date 2024
The Company reported net income of $61.4 million for the nine months ended June 30, 2024, an increase of $5.7 million compared to net income of $55.7 million for the nine months ended June 30, 2023. The change was primarily due to a decrease in non-interest expense and an increase in the release of provision for credit losses, partially offset by a decrease in net interest income.
Net interest income decreased $3.5 million, or 1.64%, to $209.7 million for the nine months ended June 30, 2024 compared to $213.2 million for the nine months ended June 30, 2023. The decrease in net interest income was primarily due to an increase in the weighted average cost of interest-bearing liabilities, mainly certificates of deposit. The weighted average cost of certificates of deposit increased 141 basis points between the two periods as balances migrated from savings and checking accounts to higher yielding certificates of deposits and accounts established in a lower interest rate environment repriced to higher yields at maturity. The weighted average yield of interest-earning assets, primarily loans, increased between the periods. The interest rate spread was 1.39% for the nine months ended June 30, 2024, a 21 basis point decrease from 1.60% for the nine months ended June 30, 2023. The net interest margin was 1.69% for the nine months ended June 30, 2024 compared to 1.82% for the prior year period.
During the nine months ended June 30, 2024, there was a $2.5 million release of provision for credit losses compared to a release of $2.0 million for the nine months ended June 30, 2023. Continued recoveries of loan amounts previously charged off and low levels of current loan charge-offs resulted in the release of provision. Net loan recoveries totaled $3.6 million for the nine months ended June 30, 2024 and $4.6 million for the same period in the prior year.
The total allowance for credit losses at June 30, 2024 was $95.7 million, or 0.63% of total loans receivable, compared to $104.8 million, or 0.69% of total loans receivable, at September 30, 2023. The decrease was almost entirely due to the adoption of recently issued accounting guidance related to the accounting for troubled debt restructurings, which resulted in a $10.2 million reduction to the allowance and a $7.9 million adjustment to retained earnings, net of tax. The allowance for credit losses included $28.2 million and $27.5 million in liabilities for unfunded commitments at June 30, 2024 and September 30, 2023, respectively. Total loan delinquencies increased to $28.6 million, or 0.19% of total loans receivable, at June 30, 2024 from $28.3 million, or 0.19% of totals loans receivable, at March 31, 2024 and $23.4 million, or 0.15% of total loans receivable, at September 30, 2023. Non-accrual loans increased to $35.4 million, or 0.23% of total loans receivable, at June 30, 2024 from $35.3 million, or 0.23% of total loans receivable, at March 31, 2024 and $31.9 million, or 0.21% of total loans receivable, at September 30, 2023.
Total non-interest expense decreased $8.3 million, or 5%, to $153.3 million for the nine months ended June 30, 2024, from $161.6 million for the nine months ended June 30, 2023 and included decreases of $7.0 million in marketing costs and $2.6 million in salaries and employee benefits, partially offset by an increase of $1.2 million in federal ("FDIC") insurance premiums. The decrease in salaries and employee benefits was primarily related to decreases in staffing and accruals for discretionary incentive payments. FDIC premiums increased due to growth in deposits and a two basis point increase in FDIC assessment rates that went into effect on January 1, 2023, partially offset by a decrease during the third fiscal quarter of 2024 related to recent changes in accounting for TDRs.
Total assets increased by $117.0 million, or 1%, to $17.03 billion at June 30, 2024 from $16.92 billion at September 30, 2023. The increase was mainly the result of increases in cash and cash equivalents, loans held for sale and loans held for investment, partially offset by a decrease in other assets.
Cash and cash equivalents increased $93.7 million, or 20%, to $560.4 million at June 30, 2024 from $466.7 million at September 30, 2023 due to normal fluctuations and liquidity management.
Loans held for sale increased $27.1 million, or 821%, to $30.4 million at June 30, 2024 from $3.3 million at June 30, 2023 due to an increase in both loans committed to forward sales and loans identified for future sale.


Loans held for investment, net of allowance and deferred loan expenses, increased $24.2 million, or less than 1%, to $15.19 billion at June 30, 2024 from $15.17 billion at September 30, 2023. Home equity loans and lines of credit increased $558.3 million to $3.59 billion and the residential mortgage loan portfolio decreased $532.6 million to $11.55 billion. Loans originated and purchased during the nine months ended June 30, 2024 included $598.7 million of residential mortgage loans and $1.62 billion of equity loans and lines of credit compared to $1.31 billion of residential mortgage loans and $1.24 billion of equity loans and lines of credit originated or purchased during the nine months ended June 30, 2023. The decrease in mortgage loan originations was primarily due to a relatively high interest rate environment, resulting in minimal refinance activity. New mortgage loans included 93% purchases and 22% adjustable rate loans during the nine months ended June 30, 2024. There were $190.7 million of residential mortgage loans, primarily long-term fixed-rate loans, sold during the nine months ended June 30, 2024, including those in contracts pending settlement at the end of the period, with a net gain on sale of $1.6 million. During the nine months ended June 30, 2023, $58.1 million of residential mortgage loans were sold with a net gain on sale of $0.6 million.
Other assets decreased $34.2 million, or 29.16%, to $83.1 million at June 30, 2024 from $117.3 million at September 30, 2023. The decrease was mainly due to a decrease in the swap margin receivable related to changes in market values of swap instruments and the impact of those changes on daily settlement transactions.
Deposits increased $576.2 million, or 6%, to $10.03 billion at June 30, 2024 from $9.45 billion at September 30, 2023. The increase was the result of a $1.09 billion increase in certificates of deposit, partially offset by a $274.0 million decrease in savings accounts, a $138.1 million decrease in money market deposit accounts and a $118.0 million decrease in checking accounts. There was $1.21 billion in brokered deposits at June 30, 2024 compared to $1.16 billion at September 30, 2023. At June 30, 2024, brokered deposits included $725.0 million of three-month certificates of deposit accounts, aligned with interest rate swap contracts, with a remaining weighted average effective maturity of approximately 2.8 years.
Borrowed funds decreased $444.3 million, or 8%, to $4.83 billion at June 30, 2024 from $5.27 billion at September 30, 2023. The decrease was primarily due to borrowings paid off at maturity. The total balance of borrowed funds at June 30, 2024, all from the FHLB, included $1.81 billion of term advances with a weighted average maturity of approximately 2.0 years, and $3.00 billion of term advances, aligned with interest rate swap contracts, with a remaining weighted average effective maturity of approximately 3.2 years. Additional borrowing capacity at the FHLB was $2.68 billion at June 30, 2024.
Borrowers’ advances for insurance and taxes decreased $57.7 million, or 46%, to $66.8 million at June 30, 2024 from $124.4 million at September 30, 2023. This decrease was primarily related to the timing of real estate tax payments that are collected from borrowers and remitted to various taxing agencies when due.
Accrued expenses and other liabilities increased $68.0 million, or 60%, to $180.9 million at June 30, 2024 from $112.9 million at September 30, 2023. This increase was mainly due to in-transit real estate tax payments that had not yet cleared at the reporting date, slightly offset by a decrease in deferred tax liability.
Total shareholders' equity decreased $12.3 million, or 1%, to $1.92 billion at June 30, 2024 from $1.93 billion at September 30, 2023. Activity reflects $61.4 million of net income, a $7.9 million adjustment to retained earnings related to a change in accounting principle described above with respect to changes in the allowance for credit losses, a $42.6 million net decrease in accumulated other comprehensive income, dividends paid of $44.2 million and net positive adjustments of $5.2 million related to our stock compensation and employee stock ownership plans. The change in accumulated other comprehensive income was primarily due to a net decrease in unrealized gains and losses on swap contracts. There were no stock repurchases during the nine months ended June 30, 2024. The Company's eighth stock repurchase program allows for a total of 10,000,000 shares to be repurchased, with 5,191,951 shares authorized for repurchase at June 30, 2024.
The Company declared and paid a quarterly dividend of $0.2825 per share during each of the first, second and third quarters of fiscal year 2024. As a result of a mutual member vote, Third Federal Savings and Loan Association of Cleveland, MHC (the "MHC"), the mutual holding company that owns approximately 81% of the outstanding stock of the Company, was able to waive its receipt of its share of the dividend paid. Under Federal Reserve regulations, the MHC is required to obtain the approval of its members every 12 months for the MHC to waive its right to receive dividends. As a result of a July 9, 2024 member vote, the MHC has the approval to waive receipt of up to $1.13 per share of possible dividends to be declared on the Company’s common stock during the twelve months subsequent to the members’ approval (i.e., through July 9, 2025). The MHC has filed a notice with, and a request for non-objection from, the Federal Reserve Bank of Cleveland for the proposed dividend waiver. Both the non-objection from the Federal Reserve Bank and the timing of the non-objection are unknown at this point. The MHC has conducted the member vote to approve the dividend waiver each of the past eleven years under Federal Reserve regulations and for each of those eleven years, approximately 97% of the votes cast were in favor of the waiver.
The Company operates under the capital requirements for the standardized approach of the Basel III capital framework


for U.S. banking organizations (“Basel III Rules”). At June 30, 2024 all of the Company's capital ratios exceed the amounts required for the Company to be considered "well capitalized" for regulatory capital purposes. The Company's Tier 1 leverage ratio was 10.82%, its Common Equity Tier 1 and Tier 1 ratios were each 18.82% and its total capital ratio was 19.55%.
Presentation slides as of June 30, 2024 will be available on the Company's website, www.thirdfederal.com, under the Investor Relations link within the "Recent Presentations" menu, beginning July 31, 2024. The Company will not be hosting a conference call to discuss its operating results.
Third Federal Savings and Loan Association is a leading provider of savings and mortgage products, and operates under the values of love, trust, respect, a commitment to excellence and fun. Founded in Cleveland in 1938 as a mutual association by Ben and Gerome Stefanski, Third Federal’s mission is to help people achieve the dream of home ownership and financial security. It became part of a public company in 2007 and celebrated its 85th anniversary in May 2023. Third Federal, which lends in 26 states and the District of Columbia, is dedicated to serving consumers with competitive rates and outstanding service. Third Federal, an equal housing lender, has 21 full service branches in Northeast Ohio, two lending offices in Central and Southern Ohio, and 16 full service branches throughout Florida. As of June 30, 2024, the Company’s assets totaled $17.03 billion.


Forward Looking Statements
This report contains forward-looking statements, which can be identified by the use of such words as estimate, project, believe, intend, anticipate, plan, seek, expect and similar expressions. These forward-looking statements include, among other things:
●statements of our goals, intentions and expectations;
●statements regarding our business plans and prospects and growth and operating strategies;
●statements concerning trends in our provision for credit losses and charge-offs on loans and off-balance sheet exposures;
●statements regarding the trends in factors affecting our financial condition and results of operations, including credit quality of our loan and investment portfolios; and
●estimates of our risks and future costs and benefits.
These forward-looking statements are subject to significant risks, assumptions and uncertainties, including, among other things, the following important factors that could affect the actual outcome of future events:
●significantly increased competition among depository and other financial institutions, including with respect to our ability to charge overdraft fees;
●inflation and changes in the interest rate environment that reduce our interest margins or reduce the fair value of financial instruments, or our ability to originate loans;
●general economic conditions, either globally, nationally or in our market areas, including employment prospects, real estate values and conditions that are worse than expected;
●
the strength or weakness of the real estate markets and of the consumer and commercial credit sectors and its impact on the credit quality of our loans and other assets, and changes in estimates of the allowance for credit losses;
●decreased demand for our products and services and lower revenue and earnings because of a recession or other events;
●changes in consumer spending, borrowing and savings habits, including repayment speeds on loans;
●adverse changes and volatility in the securities markets, credit markets or real estate markets;
●our ability to manage market risk, credit risk, liquidity risk, reputational risk, regulatory risk and compliance risk;
●our ability to access cost-effective funding;
●changes in liquidity, including the size and composition of our deposit portfolio and the percentage of uninsured deposits in the portfolio;
●legislative or regulatory changes that adversely affect our business, including changes in regulatory costs and capital requirements and changes related to our ability to pay dividends and the ability of Third Federal Savings, MHC to waive dividends;
●changes in accounting policies and practices, as may be adopted by the bank regulatory agencies, the FASB or the PCAOB;
●the adoption of implementing regulations by a number of different regulatory bodies, and uncertainty in the exact nature, extent and timing of such regulations and the impact they will have on us;
●our ability to enter new markets successfully and take advantage of growth opportunities;
●our ability to retain key employees;
●future adverse developments concerning Fannie Mae or Freddie Mac;
●changes in monetary and fiscal policy of the U.S. Government, including policies of the U.S. Treasury, the Federal Reserve System, Fannie Mae, the OCC, FDIC, and others;
●the continuing governmental efforts to restructure the U.S. financial and regulatory system;
●the ability of the U.S. Government to remain open, function properly and manage federal debt limits;
●changes in policy and/or assessment rates of taxing authorities that adversely affect us or our customers;
●changes in accounting and tax estimates;
●
changes in our organization and changes in expense trends, including but not limited to trends affecting non-performing assets, charge-offs and provisions for credit losses;
●the inability of third-party providers to perform their obligations to us;
●our ability to retain key employees;
●civil unrest;
●cyber-attacks, computer viruses and other technological risks that may breach the security of our websites or other systems to obtain unauthorized access to confidential information, destroy data or disable our systems; and
●the impact of wide-spread pandemic, including COVID-19, and related government action, on our business and the economy.
     Because of these and other uncertainties, our actual future results may be materially different from the results indicated by any forward-looking statements. Any forward-looking statement made by us in this report speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future developments or otherwise, except as may be required by law.


TFS FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CONDITION (unaudited)
(In thousands, except share data)
June 30,
2024		March 31,
2024		September 30,
2023
ASSETS
Cash and due from banks$29,411 $27,381 $29,134 
Other interest-earning cash equivalents531,024 566,953 437,612 
Cash and cash equivalents560,435 594,334 466,746 
Investment securities available for sale522,967 520,172 508,324 
Mortgage loans held for sale 30,391 9,698 3,260 
Loans held for investment, net:
Mortgage loans15,189,683 15,152,032 15,177,844 
Other loans5,070 4,709 4,411 
Deferred loan expenses, net62,738 61,047 60,807 
Allowance for credit losses on loans(67,529)(68,169)(77,315)
Loans, net15,189,962 15,149,619 15,165,747 
Mortgage loan servicing rights, net7,591 7,547 7,400 
Federal Home Loan Bank stock, at cost232,083 240,365 247,098 
Real estate owned, net431 230 1,444 
Premises, equipment, and software, net33,665 33,885 34,708 
Accrued interest receivable58,615 56,887 53,910 
Bank owned life insurance contracts315,710 313,458 312,072 
Other assets83,090 90,955 117,270 
TOTAL ASSETS$17,034,940 $17,017,150 $16,917,979 
LIABILITIES AND SHAREHOLDERS’ EQUITY
Deposits$10,025,977 $9,935,631 $9,449,820 
Borrowed funds4,829,365 4,955,438 5,273,637 
Borrowers’ advances for insurance and taxes66,757 99,492 124,417 
Principal, interest, and related escrow owed on loans serviced16,867 25,946 29,811 
Accrued expenses and other liabilities180,910 93,146 112,933 
Total liabilities15,119,876 15,109,653 14,990,618 
Commitments and contingent liabilities
Preferred stock, $0.01 par value, 100,000,000 shares authorized, none issued and outstanding— — — 
Common stock, $0.01 par value, 700,000,000 shares authorized; 332,318,750 shares issued3,323 3,323 3,323 
Paid-in capital1,753,074 1,751,960 1,755,027 
Treasury stock, at cost(772,195)(772,195)(776,101)
Unallocated ESOP shares(23,834)(24,917)(27,084)
Retained earnings—substantially restricted912,082 906,908 886,984 
Accumulated other comprehensive income 42,614 42,418 85,212 
Total shareholders’ equity1,915,064 1,907,497 1,927,361 
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY$17,034,940 $17,017,150 $16,917,979 




TFS FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (unaudited)
(In thousands, except share and per share data)
For the three months ended
 June 30,
2024		March 31,
2024		December 31,
2023		September 30,
2023		June 30,
2023
INTEREST AND DIVIDEND INCOME:
Loans, including fees$166,268 $162,970 $162,035 $154,763 $144,347 
Investment securities available for sale4,663 4,476 4,395 4,141 3,712 
Other interest and dividend earning assets13,975 16,047 10,729 9,836 8,598 
Total interest and dividend income184,906 183,493 177,159 168,740 156,657 
INTEREST EXPENSE:
Deposits75,521 72,685 64,326 55,565 48,905 
Borrowed funds40,112 39,430 43,741 42,812 38,973 
Total interest expense115,633 112,115 108,067 98,377 87,878 
NET INTEREST INCOME69,273 71,378 69,092 70,363 68,779 
PROVISION (RELEASE) FOR CREDIT LOSSES(500)(1,000)(1,000)500 — 
NET INTEREST INCOME AFTER PROVISION (RELEASE) FOR CREDIT LOSSES69,773 72,378 70,092 69,863 68,779 
NON-INTEREST INCOME:
Fees and service charges, net of amortization2,097 1,845 1,748 2,061 1,919 
Net gain (loss) on the sale of loans723 442 481 (119)21 
Increase in and death benefits from bank owned life insurance contracts2,254 2,193 3,191 2,204 2,790 
Other1,171 1,242 895 954 1,113 
Total non-interest income6,245 5,722 6,315 5,100 5,843 
NON-INTEREST EXPENSE:
Salaries and employee benefits26,845 27,501 27,116 28,660 25,332 
Marketing services4,867 5,099 4,431 3,881 7,023 
Office property, equipment and software7,008 7,303 6,845 6,886 7,246 
Federal insurance premium and assessments3,258 4,013 3,778 3,629 3,574 
State franchise tax1,244 1,238 1,176 1,185 1,230 
Other expenses7,566 7,044 6,931 7,243 8,472 
Total non-interest expense50,788 52,198 50,277 51,484 52,877 
INCOME BEFORE INCOME TAXES25,230 25,902 26,130 23,479 21,745 
INCOME TAX EXPENSE5,277 5,189 5,423 3,933 4,142 
NET INCOME$19,953 $20,713 $20,707 $19,546 $17,603 
Earnings per share - basic and diluted $0.07 $0.07 $0.07 $0.07 $0.06 
Weighted average shares outstanding
Basic278,291,376 278,183,041 277,841,526 277,589,775 277,472,312 
Diluted279,221,360 279,046,837 279,001,898 278,826,441 278,590,810 



TFS FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (unaudited)
(In thousands, except share and per share data)
 For the Nine Months Ended
June 30,
 20242023
INTEREST AND DIVIDEND INCOME:
Loans, including fees$491,273 $410,847 
Investment securities available for sale13,534 10,229 
Other interest and dividend earning assets40,751 22,103 
Total interest and dividend income545,558 443,179 
INTEREST EXPENSE:
Deposits212,532 118,636 
Borrowed funds123,283 111,339 
Total interest expense335,815 229,975 
NET INTEREST INCOME209,743 213,204 
PROVISION (RELEASE) FOR CREDIT LOSSES(2,500)(2,000)
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES212,243 215,204 
NON-INTEREST INCOME:
Fees and service charges, net of amortization5,690 5,779 
Net gain on the sale of loans1,646 617 
Increase in and death benefits from bank owned life insurance contracts7,638 7,151 
Other3,308 2,782 
Total non-interest income18,282 16,329 
NON-INTEREST EXPENSE:
Salaries and employee benefits81,462 84,125 
Marketing services14,397 21,407 
Office property, equipment and software21,156 20,848 
Federal insurance premium and assessments11,049 9,823 
State franchise tax3,658 3,706 
Other expenses21,541 21,736 
Total non-interest expense153,263 161,645 
INCOME BEFORE INCOME TAXES77,262 69,888 
INCOME TAX EXPENSE15,889 14,184 
NET INCOME$61,373 $55,704 
Earnings per share - basic and diluted$0.22 $0.20 
Weighted average shares outstanding
Basic278,104,352 277,384,689 
Diluted279,072,087 278,507,602 


TFS FINANCIAL CORPORATION AND SUBSIDIARIES
AVERAGE BALANCES AND YIELDS (unaudited)
Three Months EndedThree Months EndedThree Months Ended
June 30, 2024March 31, 2024June 30, 2023
 Average
Balance		Interest
Income/
Expense		Yield/
Cost (1)		Average
Balance		Interest
Income/
Expense		Yield/
Cost (1)		Average
Balance		Interest
Income/
Expense		Yield/
Cost (1)
 (Dollars in thousands)
Interest-earning assets:
  Interest-earning cash
equivalents		$618,986 $8,500 5.49 %$720,657 $9,919 5.51 %$350,574 $4,481 5.11 %
  Investment securities72,161 906 5.02 %72,091 907 5.03 %24,046 320 5.32 %
  Mortgage-backed securities452,224 3,757 3.32 %448,653 3,569 3.18 %470,457 3,392 2.88 %
  Loans (2)15,175,535 166,268 4.38 %15,163,185 162,970 4.30 %14,676,829 144,347 3.93 %
  Federal Home Loan Bank stock235,755 5,475 9.29 %244,560 6,128 10.02 %235,177 4,117 7.00 %
Total interest-earning assets16,554,661 184,906 4.47 %16,649,146 183,493 4.41 %15,757,083 156,657 3.98 %
Noninterest-earning assets513,931 505,145 543,310 
Total assets$17,068,592 $17,154,291 $16,300,393 
Interest-bearing liabilities:
  Checking accounts$866,170 94 0.04 %$887,584 98 0.04 %$1,064,738 1,317 0.49 %
  Savings accounts1,437,406 4,967 1.38 %1,561,331 5,598 1.43 %1,890,427 8,087 1.71 %
  Certificates of deposit7,654,612 70,460 3.68 %7,548,314 66,989 3.55 %6,042,798 39,501 2.61 %
  Borrowed funds4,892,621 40,112 3.28 %5,033,253 39,430 3.13 %5,175,982 38,973 3.01 %
Total interest-bearing liabilities14,850,809 115,633 3.11 %15,030,482 112,115 2.98 %14,173,945 87,878 2.48 %
Noninterest-bearing liabilities261,741 212,206 264,952 
Total liabilities15,112,550 15,242,688 14,438,897 
Shareholders’ equity1,956,042 1,911,603 1,861,496 
Total liabilities and shareholders’ equity$17,068,592 $17,154,291 $16,300,393 
Net interest income$69,273 $71,378 $68,779 
Interest rate spread (1)(3)1.36 %1.43 %1.50 %
Net interest-earning assets (4)$1,703,852 $1,618,664 $1,583,138 
Net interest margin (1)(5)1.67 %1.71 %1.75 %
Average interest-earning assets to average interest-bearing liabilities111.47 %110.77 %111.17 %
Selected performance ratios:
Return on average assets (1)0.47 %0.48 %0.43 %
Return on average equity (1)4.08 %4.33 %3.78 %
Average equity to average assets11.46 %11.14 %11.42 %
 
(1)Annualized.
(2)Loans include both mortgage loans held for sale and loans held for investment.
(3)Interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.
(4)Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
(5)Net interest margin represents net interest income divided by total interest-earning assets.








TFS FINANCIAL CORPORATION AND SUBSIDIARIES
AVERAGE BALANCES AND YIELDS (unaudited)
Nine Months EndedNine Months Ended
June 30, 2024June 30, 2023
Average
Balance		Interest
Income/
Expense		Yield/
Cost (1)		Average
Balance		Interest
Income/
Expense		Yield/
Cost (1)
 (Dollars in thousands)
Interest-earning assets:
  Interest-earning cash
  equivalents		$579,383 $23,543 5.42 %$351,742 $11,677 4.43 %
Investment securities69,677 2,663 5.10 %10,438 342 4.37 %
Mortgage-backed securities448,429 10,871 3.23 %470,108 9,887 2.80 %
  Loans (2)
15,190,356 491,273 4.31 %14,530,428 410,847 3.77 %
  Federal Home Loan Bank stock250,285 17,208 9.17 %228,318 10,426 6.09 %
Total interest-earning assets16,538,130 545,558 4.40 %15,591,034 443,179 3.79 %
Noninterest-earning assets524,179 518,875 
Total assets$17,062,309 $16,109,909 
Interest-bearing liabilities:
  Checking accounts$897,190 310 0.05 %$1,126,064 5,956 0.71 %
  Savings accounts1,573,401 17,477 1.48 %1,774,965 16,822 1.26 %
  Certificates of deposit7,350,136 194,745 3.53 %6,042,061 95,858 2.12 %
  Borrowed funds5,051,371 123,283 3.25 %5,053,965 111,339 2.94 %
Total interest-bearing liabilities14,872,098 335,815 3.01 %13,997,055 229,975 2.19 %
Noninterest-bearing liabilities250,916 243,823 
Total liabilities15,123,014 14,240,878 
Shareholders’ equity1,939,295 1,869,031 
Total liabilities and shareholders’ equity$17,062,309 $16,109,909 
Net interest income$209,743 $213,204 
Interest rate spread (1)(3)
1.39 %1.60 %
Net interest-earning assets (4)
$1,666,032 $1,593,979 
Net interest margin (1)(5)
1.69 %1.82 %
Average interest-earning assets to average interest-bearing liabilities111.20 %111.39 %
Selected performance ratios:
Return on average assets (1)
0.48 %0.46 %
Return on average equity (1)
4.22 %3.97 %
Average equity to average assets11.37 %11.60 %


(1)Annualized
(2)Loans include both mortgage loans held for sale and loans held for investment.
(3)Interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.
(4)Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
(5)Net interest margin represents net interest income divided by total interest-earning assets.


v3.24.2
Document And Entity Information
Jan. 30, 2024
Cover [Abstract]  
Document Period End Date Jul. 30, 2024
Document Type 8-K
Entity Registrant Name TFS FINANCIAL CORPORATION
Entity Incorporation, State or Country Code X1
Entity File Number 001-33390
Entity Tax Identification Number 52-2054948
Entity Address, Address Line One 7007 Broadway Ave.,
Entity Address, City or Town Cleveland,
Entity Address, State or Province OH
Entity Address, Postal Zip Code 44105
City Area Code (216)
Local Phone Number 441-6000
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Entity Emerging Growth Company false
Title of 12(b) Security Common Stock, par value $0.01 per share
Trading Symbol TFSL
Security Exchange Name NASDAQ
Entity Central Index Key 0001381668
Amendment Flag false
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