WaFd Bank delivered a first quarter that exceeded Wall Street’s expectations, with management attributing the strong performance to a meaningful rebound in loan growth and disciplined expense management. CEO Brent Beardall emphasized that "the headline for this quarter is loan growth," noting it was the first expansion in the loan portfolio after several quarters of contraction. The quarter also benefited from a well-controlled cost base and a notable increase in net interest income, aided by favorable repricing of liabilities and successful execution of share repurchases. Additionally, the bank highlighted continued improvements in credit quality, as nonperforming assets and delinquencies trended positively despite lingering economic pressures.
Is now the time to buy WAFD? Find out in our full research report (it’s free for active Edge members).
WaFd Bank (WAFD) Q1 CY2026 Highlights:
- Revenue: $198.3 million vs analyst estimates of $190.5 million (10.5% year-on-year growth, 4% beat)
- Adjusted EPS: $0.83 vs analyst estimates of $0.75 (10.7% beat)
- Adjusted Operating Income: $84.4 million vs analyst estimates of $83.34 million (42.6% margin, 1.3% beat)
- Market Capitalization: $2.59 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From WaFd Bank’s Q1 Earnings Call
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Jeff Rulis (D.A. Davidson) asked about the sustainability of the recent margin improvement. CFO Kelli Holz clarified that the 7-basis-point increase was tied to bringing a large nonperforming credit current and recognized as a one-time benefit, while CEO Brent Beardall described the long-term path to a 3% margin as driven by organic repricing and deposit growth.
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Jeff Rulis (D.A. Davidson) inquired whether active loan growth was an outlier or sustainable. Beardall responded that management is “very bullish” on maintaining the current growth pace, noting robust loan pipelines and continued traction in business banking.
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Matthew Clark (Piper Sandler) asked about the composition of loan growth and the role of club deals. Beardall confirmed that recent growth was primarily from direct originations, with minimal contribution from club deals, and offered to follow up with more details on portfolio composition.
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Matthew Clark (Piper Sandler) questioned the sustainability of noninterest income, particularly insurance commissions. Beardall indicated that the current $20 million quarterly run rate is sustainable, with organic growth expected in insurance and wealth management, though he cautioned that wealth management is not yet profitable.
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Kelly Motta (KBW) asked about deposit funding trends and the impact on margin targets. Beardall explained that while new commercial relationships are opening operating accounts, sizable deposit balances typically build over time, supporting the bank’s broader strategy for low-cost funding growth.
Catalysts in Upcoming Quarters
In upcoming quarters, the StockStory team will be watching (1) whether WaFd can accelerate growth in both business banking relationships and low-cost deposits, (2) the adoption and impact of new digital banking and AI-powered customer service tools, and (3) trends in credit quality, especially as economic and competitive pressures persist. Capital deployment decisions, including share repurchases and responses to potential regulatory changes, will also be key milestones to track.
WaFd Bank currently trades at $35.04, up from $32.51 just before the earnings. Is there an opportunity in the stock?See for yourself in our full research report (it’s free).
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