This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Washington Federal Posts In-Line Profit

Stocks in this article: WFSL HCBK BKUT

SEATTLE ( TheStreet) -- Washington Federal (WFSL) on Thursday reported fourth-quarter earnings of $24.5 million, or 22 cents a share.

The fourth-quarter results matched the consensus estimate of analysts polled by Thomson Reuters and the company's shares were down 1% in afternoon trading to $17.34.

In comparison, Washington Federal earned $16 million, or 14 cents a share, in the third quarter, and $7.9 million, or 7 cents a share, during the fourth quarter of 2009.

The quarter-over-quarter improvement mainly reflected a $4.4 million increase in net interest income to $104.7 million, as the company prepaid debt. The net interest margin -- essentially a bank's average yield on loans and investments minus its cost of deposits and borrowings -- was 3.41% during the fourth quarter, improving from 3.18% in the third quarter and 3.08% a year earlier.

The year-over-year earnings improvement was driven by a reduction in credit costs, as the fourth-quarter provision for loan losses was $26 million, the same level as the third quarter but sharply down from $69.8 million in the fourth quarter of 2009.

The company reported that nonperforming assets totaled $443 million, or 3.30% of total assets as of Dec. 31, up slightly from 3.22% in the previous quarter but much-improved from 4.37% at the end of 2009.

Washington Federal's fourth-quarter return on average assets was 0.73% and its tangible common equity ratio was a strong 12.01% as of Dec. 31, increasing slightly from 11.97% in September and 11.91% at the end of 2009.

CEO Roy Whitehead called the improvement in Washington Federal's net interest income "encouraging," and said the company had "a notably positive earnings trend going despite soft housing and the slow economy," adding that "investors are advised that while credit losses are expected to continue at an elevated level, the Company seems well positioned to absorb them and still post reasonably good profits."

Washington Federal's fourth-quarter efficiency ratio was 31.4%, improving from 32.19% the previous quarter, which was third-best among publicly traded U.S. banks and thrifts according to data supplied by SNL Financial, bested only by Hudson City Bancorp (HCBK) which had a third-quarter efficiency ratio of 22.55% and Bank of Utica (BKUT), with a third-quarter efficiency ratio of 23.25%.

Please see TheStreet's 10 Efficient, Stable and Profitable U.S. Banks for a complete discussion on the efficiency ratio and all three companies.


-- Written by Philip van Doorn in Jupiter, Fla.

To contact the writer, click here: Philip van Doorn.

To follow the writer on Twitter, go to

To submit a news tip, send an email to:

Philip W. van Doorn is a member of TheStreet's banking and finance team, commenting on industry and regulatory trends. He previously served as the senior analyst for Ratings, responsible for assigning financial strength ratings to banks and savings and loan institutions. Mr. van Doorn previously served as a loan operations officer at Riverside National Bank in Fort Pierce, Fla., and as a credit analyst at the Federal Home Loan Bank of New York, where he monitored banks in New York, New Jersey and Puerto Rico. Mr. van Doorn has additional experience in the mutual fund and computer software industries. He holds a bachelor of science in business administration from Long Island University.

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,356.87 +288.00 1.69%
S&P 500 2,012.89 +40.15 2.04%
NASDAQ 4,644.3120 +96.4780 2.12%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs