- Allowance for credit losses was $51.6 million or 1.26% of gross loans, down from $54.9 million in the prior quarter.
- Earnings for the June quarter were $1.39 diluted, unchanged from the prior quarter but up 17% year-over-year.
- Full year fiscal '25 earnings were $5.18 compared to $4.42 in fiscal '24, driven by stronger net interest income from 7% earning asset growth and net interest margin expansion.
- Net charge-offs totaled $5.3 million for the quarter, primarily from a special purpose CRE loan and a commercial contractor credit.
- Net interest margin for the quarter was 3.46%, up from 3.39% in the prior quarter, benefiting from higher loan yields and deployment of excess cash into loans.
- Noninterest expense rose 2.3% due to $425,000 consulting expenses and increased data processing costs.
- Noninterest income increased 9.2% quarter-over-quarter, driven by an additional card network bonus of $537,000.
- Provision for credit losses increased to $2.5 million from $932,000 in the prior quarter due to net charge-offs and loan growth.
- Quarterly dividend increased by $0.02 or 8.7% to $0.25 per share.
- Return on average assets was 1.21% and return on average equity was 11.4% for fiscal 2025.
- Tangible book value per share increased by $5.19 or just above 14% over the last 12 months to $41.87.
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- Capital allocated to legacy investments reduced by 17% since March 31, 2025.
- Core segment's earnings available for distribution (EAD) was $25 million or $0.18 per share, with a 14.5% annualized ROE, compared to $28 million or $0.20 per share in Q1.
- CoreVest Mortgage Banking achieved $6 million segment net income and a 34% annualized EAD ROE.
- GAAP book value per share declined to $7.49 at June 30, 2025, from $8.39 at March 31, 2025.
- Legacy investments recorded a $104 million loss, driven by negative fair value adjustments and accelerated asset sales.
- Mortgage banking platforms delivered combined returns exceeding 20% and gain on sale margins above target for the fourth consecutive quarter.
- Mortgage banking revenue increased 88% year-over-year.
- Redwood reported a GAAP net loss of $100.2 million or $0.76 per share for Q2 2025, primarily due to accelerated wind down of legacy portfolio and associated fair value changes.
- Sequoia Mortgage Banking generated $22 million segment net income with a 19% annualized ROE; Aspire loan volumes tripled sequentially to $330 million.
- A quarterly cash dividend of $0.20 per common share was approved, marking the 114th consecutive quarterly dividend.
- Asset quality remained strong with classified loans decreasing 3% to $145 million or 1.4% of total loans.
- Capital levels remained robust with a common equity Tier 1 capital ratio of 11% and tangible book value per share of $19.34.
- Commercial and industrial loans increased 8% for the quarter.
- Earnings per share were $0.28 on a fully diluted GAAP basis and $0.31 on a core basis for Q2 2025.
- Net charge-offs were $2.2 million, primarily from two commercial credits and a small sale of nonperforming residential loans.
- Net interest income grew by $1 million with net interest margin expanding by 1 basis point.
- Operating expenses were $71 million, in line with expectations and previous guidance.
- The company repurchased 1 million shares at a weighted average cost of $17.17 and redeemed $57 million of preferred stock.
- Total loans increased by $60 million, representing a 2% annualized growth rate, driven by strong originations of $716 million.
- Average total deposits increased 6% year-over-year and 1% quarter-over-quarter to $7.6 billion.
- Commercial real estate concentration decreased to under 500% for the first time since Q3 2023.
- Criticized and classified loans to total loans improved to 108 basis points from 133 basis points prior quarter.
- GAAP and core net interest margin expanded 3 basis points quarter-over-quarter, with GAAP NIM at 2.54% and core NIM at 2.52%.
- GAAP earnings per share of $0.41 and core earnings per share of $0.32, increases of 128% and 78% year-over-year respectively.
- Net charge-offs totaled 15 basis points for the quarter, down from 27 basis points in the prior quarter.
- Noninterest-bearing deposits grew 6% year-over-year and 2% quarter-over-quarter to $875 million.
- Nonperforming assets stable at 70 to 75 basis points quarter-over-quarter.
- Pre-provision pretax net revenue of $23.1 million and core PPNR of $19 million reached highest levels since late 2022.
- Strong liquidity with $3.6 billion of undrawn lines and resources at quarter end.
- Tangible common equity grew by 25 basis points to 8.04%.
- Book value was nearly unchanged from quarter end after accrued dividends were accounted for.
- Capital raised totaled $560 million this year, primarily through common equity issued above book value, accretive to shareholders.
- Dynex Capital's market capitalization grew nearly 50% year-over-year to over $1.5 billion as of June 30, 2025.
- Liquidity remained strong at $891 million, representing 55% of total equity.
- Net interest income increased due to new investments with attractive yields and positive carry from agency RMBS and swaps.
- ROEs on newly acquired positions, fully hedged, ranged from mid-teens to low 20% range.
- The portfolio grew to $14 billion, a 25% increase from the prior quarter and over 50% from the prior year.
- Adjusted consolidated net operating income was $84.1 million or $1.30 per diluted share.
- Commercial Auto segment had an underlying combined ratio of 90% with 18% PIF growth, despite $19 million adverse prior-year development.
- Kemper reported net income of $72.6 million or $1.12 per diluted share for Q2 2025.
- Life segment showed stable operating results with strong return on capital and distributable cash flows.
- Operating cash flow hit an all-time high of nearly $600 million trailing 12 months.
- Return on adjusted equity was 14.9%, with adjusted book value per share growth of 14.3% year-over-year.
- Specialty Auto segment produced an underlying combined ratio of 93.5% and 8% year-over-year policies in force (PIF) growth.
- The company repurchased $80 million of common stock since April 1 and received board approval for an additional $500 million repurchase authorization.
- Annaly delivered an economic return of 0.7% for Q2 2025, marking the seventh consecutive quarter of positive economic returns.
- Book value per share decreased 3% quarter-over-quarter to $18.45 after accounting for dividends.
- Earnings available for distribution (EAD) per share increased by $0.01 to $0.73, exceeding the dividend of $0.70 for the quarter.
- Higher yields on the investment portfolio at 5.41% compared to 5.23% in the prior quarter contributed to results.
- Lower average repo rates of 4.53% during the quarter, a modest decline of 3 basis points, partially offset gains.
- Net interest spread excluding PAA increased to 1.47% in Q2 from 1.24% a year ago; net interest margin ex PAA rose to 1.71% from 1.58%.
- Residential credit business generated additional income due to growth in accretive OBX securitizations and record issuance activity.
- Total facility capacity for residential credit was $4.2 billion with 40% utilization; MSR business had $2.1 billion capacity with 50% utilization.
- Unencumbered assets ended Q2 at approximately $6 billion, including $4.7 billion in unencumbered Agency MBS.
- Year-to-date economic return reached 3.7% with total shareholder return over 10% through quarter end.
Dafinchi