Capitol Federal Financial, Inc 8-K, filed Oct 25, 2023

Capitol Federal Financial, Inc. (CFFN)

8-K 2023-10-25 For: 2023-10-23

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Added on April 08, 2026

About this 8-K

Capitol Federal Financial, Inc filed this 8-K on October 25, 2023, reporting on events of October 23, 2023.

Items reported

Item 2.01: Completed an acquisition or sale of assets
Item 2.02: Financial results
Item 7.01: Regulation FD disclosure
Item 9.01: Financial statements and exhibits

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Maryland	001-34814	27-2631712
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)


700 South Kansas Avenue,	Topeka	Kansas	66603
(Address of principal executive offices)			(Zip Code)


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share	CFFN	The NASDAQ Stock Market LLC



			CAPITOL FEDERAL FINANCIAL, INC.
Date: October 25, 2023			By: /s/ Kent G. Townsend


			Kent G. Townsend, Executive Vice-President,
			Chief Financial Officer, and Treasurer


	For the Three Months Ended
	September 30,		June 30,		Change Expressed in:
	2023		2023		Dollars		Percent
	(Dollars in thousands)
INTEREST AND DIVIDEND INCOME:
Loans receivable	$	74,031	$	71,918	$	2,113	2.9	%
Cash and cash equivalents	6,139		10,009		(3,870)		(38.7)
Mortgage-backed securities ("MBS")	4,399		4,562		(163)		(3.6)
FHLB stock	2,796		3,260		(464)		(14.2)
Investment securities	894		895		(1)		(0.1)
Total interest and dividend income	$	88,259	$	90,644	$	(2,385)	(2.6)


	For the Year Ended
	September 30,				Change Expressed in:
	2023		2022		Dollars		Percent
	(Dollars in thousands)
INTEREST AND DIVIDEND INCOME:
Loans receivable	$	280,087	$	228,531	$	51,556	22.6	%
Cash and cash equivalents	43,796		18,304		25,492		139.3
MBS	18,520		19,406		(886)		(4.6)
FHLB stock	13,821		10,031		3,790		37.8
Investment securities	3,565		3,268		297		9.1
Total interest and dividend income	$	359,789	$	279,540	$	80,249	28.7


							Annualized
	September 30,			June 30,			Percent		September 30,			Percent
	2023			2023			Change		2022			Change
	(Dollars and shares in thousands)
Total assets	$	10,167,372		$	10,294,127		(4.9)	%	$	9,624,897		5.6	%

Available-for-sale ("AFS") securities	1,371,136			1,444,867			(20.4)		1,563,307			(12.3)
Loans receivable, net	7,970,949			7,963,360			0.4		7,464,208			6.8
Deposits	6,051,220			6,092,840			(2.7)		6,194,866			(2.3)
Borrowings	2,879,125			2,986,162			(14.3)		2,132,154			35.0
Stockholders' equity	1,033,965			1,061,285			(10.3)		1,096,499			(5.7)
Equity to total assets at end of period	10.2		%	10.3		%			11.4		%
Average number of basic shares outstanding	133,225			133,199			0.1		135,773			(1.9)
Average number of diluted shares outstanding	133,225			133,199			0.1		135,773			(1.9)


	For the Three Months Ended				For the Year Ended
	September 30, 2023					September 30, 2023
	Amount		Rate				Amount		Rate
	(Dollars in thousands)
Loan originations, purchases, and participations
One- to four-family and consumer:
Originated	$	103,713	6.64	%			$	467,269	5.91	%
Purchased	13,598		5.97				415,797		5.02

Commercial:
Originated	46,191		7.57				463,093		6.01
Participations/Purchased	17,200		6.80				228,275		6.62
	$	180,702	6.84				$	1,574,434	5.81

Deposit Activity
Non-maturity deposits	$	(131,862)					$	(670,085)
Retail/Commercial certificates of deposit	115,200						472,888

Borrowing activity
Maturities and repayments	(107,418)		2.28				(329,672)		2.01
New borrowings	—		—				650,000		4.47
BTFP, net	—		—				500,000		4.70


Total shares outstanding			135,936,375
Less unallocated Employee Stock Ownership Plan ("ESOP") shares and unvested restricted stock			(2,896,810)
Net shares outstanding			133,039,565


Kent Townsend						Investor Relations
Executive Vice President,						(785) 270-6055
Chief Financial Officer and Treasurer						investorrelations@capfed.com
(785) 231-6360
ktownsend@capfed.com



CAPITOL FEDERAL FINANCIAL, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS (Unaudited)
(Dollars in thousands, except per share amounts)



CAPITOL FEDERAL FINANCIAL, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
(Dollars in thousands)



	For the Three Months Ended
	September 30, 2023						June 30, 2023
	Average		Interest				Average		Interest
	Outstanding		Earned/		Yield/		Outstanding		Earned/		Yield/
	Amount		Paid		Rate		Amount		Paid		Rate
Assets:	(Dollars in thousands)
Interest-earning assets:
One- to four-family loans:
Originated	$	4,036,609	$	34,584	3.43	%	$	4,052,906	$	34,224	3.38	%
Correspondent purchased	2,454,407		19,794		3.23		2,491,016		19,937		3.20
Bulk purchased	138,922		524		1.51		141,985		527		1.49
Total one- to four-family loans	6,629,938		54,902		3.31		6,685,907		54,688		3.27
Commercial loans	1,249,498		16,930		5.30		1,180,906		15,172		5.08
Consumer loans	104,252		2,199		8.37		102,390		2,058		8.06
Total loans receivable(1)	7,983,688		74,031		3.69		7,969,203		71,918		3.60
MBS(2)	1,080,611		4,399		1.63		1,126,953		4,562		1.62
Investment securities(2)(3)	525,013		894		0.68		525,012		895		0.68
FHLB stock(4)	120,159		2,796		9.23		146,482		3,260		8.93
Cash and cash equivalents(5)	453,486		6,139		5.30		769,434		10,009		5.15
Total interest-earning assets	10,162,957		88,259		3.45		10,537,084		90,644		3.43
Other non-interest-earning assets	268,871						271,898
Total assets	$	10,431,828					$	10,808,982

Liabilities and stockholders' equity:
Interest-bearing liabilities:
Checking	$	900,526	449		0.20		$	949,909	398		0.17
Savings	492,737		145		0.12		521,831		143		0.11
Money market	1,404,496		6,913		1.95		1,485,672		6,295		1.70
Retail certificates	2,498,839		20,268		3.22		2,339,477		15,685		2.69
Commercial certificates	30,735		273		3.53		44,083		307		2.80
Wholesale certificates	158,598		1,730		4.33		155,157		1,617		4.18
Total deposits	5,485,931		29,778		2.15		5,496,129		24,445		1.78



Borrowings(6)	3,150,179		27,746		3.48		3,520,594		31,449		3.57
Total interest-bearing liabilities	8,636,110		57,524		2.64		9,016,723		55,894		2.48
Non-interest-bearing deposits	540,607						556,682
Other non-interest-bearing liabilities	191,978						161,360
Stockholders' equity	1,063,133						1,074,217
Total liabilities and stockholders' equity	$	10,431,828					$	10,808,982

Net interest income(7)			$	30,735					$	34,750
Net interest-earning assets	$	1,526,847					$	1,520,361
Net interest margin(8)(9)					1.21						1.32
Ratio of interest-earning assets to interest-bearing liabilities					1.18x						1.17x

Selected performance ratios:
Return on average assets (annualized)(9)					(5.77	%)					0.31	%
Return on average equity (annualized)(9)					(56.62)						3.09
Average equity to average assets					10.19						9.94
Operating expense ratio (annualized)(10)					1.08						1.09
Efficiency ratio(9)(11)					(16.55)						72.32
Pre-tax yield on leverage strategy(12)					0.07						0.07


			For the Year Ended September 30,
			2023									2022
			Average		Interest							Average		Interest
			Outstanding		Earned/			Yield/				Outstanding		Earned/			Yield/
			Amount		Paid			Rate				Amount		Paid			Rate
			(Dollars in thousands)
Assets:
Interest-earning assets:
One- to four-family loans:
Originated			$	4,047,209	$	135,873		3.36	%			$	3,985,267	$	129,392		3.25	%
Correspondent purchased			2,428,257		76,335			3.14				2,072,677		55,227			2.66
Bulk purchased			143,105		1,923			1.34				159,152		2,053			1.29
Total one- to four-family loans			6,618,571		214,131			3.24				6,217,096		186,672			3.00
Commercial loans			1,150,831		57,991			4.97				884,126		37,223			4.15
Consumer loans			103,016		7,965			7.73				93,544		4,636			4.96
Total loans receivable(1)			7,872,418		280,087			3.55				7,194,766		228,531			3.17
MBS(2)			1,150,430		18,520			1.61				1,354,080		19,406			1.43
Investment securities(2)(3)			525,030		3,565			0.68				523,170		3,268			0.62
FHLB stock(4)			157,925		13,821			8.75				149,236		10,031			6.72
Cash and cash equivalents(5)			998,793		43,796			4.32				1,562,274		18,304			1.16
Total interest-earning assets			10,704,596		359,789			3.35				10,783,526		279,540			2.59
Other non-interest-earning assets			263,158									343,311
Total assets			$	10,967,754								$	11,126,837

Liabilities and stockholders' equity:
Interest-bearing liabilities:
Checking			$	961,779	1,504			0.16				$	1,056,303	752			0.07
Savings			525,423		488			0.09				543,609		299			0.06
Money market			1,567,540		19,426			1.24				1,840,898		4,578			0.25
Retail certificates			2,266,740		54,724			2.41				2,203,452		27,664			1.26
Commercial certificates			40,258		993			2.47				103,865		666			0.64
Wholesale certificates			134,641		5,132			3.81				150,689		497			0.33
Total deposits			5,496,381		82,267			1.50				5,898,816		34,456			0.58



Borrowings(6)			3,658,015		124,250			3.38				3,288,348		52,490			1.58
Total interest-bearing liabilities			9,154,396		206,517			2.25				9,187,164		86,946			0.94
Non-interest-bearing deposits			562,023									573,954
Other non-interest-bearing liabilities			179,374									178,526
Stockholders' equity			1,071,961									1,187,193
Total liabilities and stockholders' equity	$	10,967,754								$	11,126,837

Net interest income(7)					$	153,272								$	192,594
Net interest-earning assets			$	1,550,200								$	1,596,362
Net interest margin(8)(9)								1.43									1.79

Ratio of interest-earning assets to interest-bearing liabilities					1.17x									1.17x

Selected performance ratios:
Return on average assets(9)					(1.02		%)							0.76		%
Return on average equity(9)					(10.42)									7.11
Average equity to average assets								9.77									10.67
Operating expense ratio(10)					1.04									1.01
Efficiency ratio(9)(11)								(361.38)									52.39
Pre-tax yield on leverage strategy(12)					0.13									0.25


	September 30, 2023						June 30, 2023						September 30, 2022
					% of						% of						% of
	Amount		Rate		Total		Amount		Rate		Total		Amount		Rate		Total
	(Dollars in thousands)
One- to four-family:
Originated	$	3,978,837	3.39	%	49.9	%	$	3,992,730	3.33	%	50.1	%	$	3,988,469	3.20	%	53.4	%
Correspondent purchased	2,405,911		3.44		30.1		2,441,772		3.41		30.6		2,201,886		3.10		29.4
Bulk purchased	137,193		1.85		1.7		139,571		1.60		1.8		147,939		1.24		2.0
Construction	69,974		3.68		0.9		73,166		3.42		0.9		66,164		2.90		0.9
Total	6,591,915		3.38		82.6		6,647,239		3.33		83.4		6,404,458		3.12		85.7
Commercial:
Commercial real estate	995,788		5.29		12.5		924,142		5.00		11.6		745,301		4.30		10.0
Commercial and industrial	112,953		6.36		1.4		106,609		6.07		1.3		79,981		4.30		1.1
Construction	178,746		5.01		2.2		193,308		5.54		2.4		141,062		5.34		1.9
Total	1,287,487		5.35		16.1		1,224,059		5.18		15.3		966,344		4.45		13.0
Consumer loans:
Home equity	95,723		8.83		1.2		94,810		8.60		1.2		92,203		6.28		1.2
Other	9,256		5.20		0.1		8,632		4.96		0.1		8,665		4.21		0.1
Total	104,979		8.51		1.3		103,442		8.30		1.3		100,868		6.10		1.3
Total loans receivable	7,984,381		3.76		100.0	%	7,974,740		3.67		100.0	%	7,471,670		3.33		100.0	%

Less:
ACL	23,759						22,399						16,371
Deferred loan fees/discounts	31,335						31,557						29,736
Premiums/deferred costs	(41,662)						(42,576)						(38,645)
Total loans receivable, net	$	7,970,949					$	7,963,360					$	7,464,208



			SIGNATURES


	For the Three Months Ended
	September 30,		June 30,		Change Expressed in:
	2023		2023		Dollars		Percent
	(Dollars in thousands)
NON-INTEREST EXPENSE:
Salaries and employee benefits	$	11,804	$	13,200	$	(1,396)	(10.6)	%
Information technology and related expense	6,448		6,118		330		5.4
Occupancy, net	3,638		3,556		82		2.3
Regulatory and outside services	1,765		1,436		329		22.9
Federal insurance premium	1,167		1,231		(64)		(5.2)
Advertising and promotional	692		1,447		(755)		(52.2)
Deposit and loan transaction costs	778		615		163		26.5
Office supplies and related expense	689		546		143		26.2

Other non-interest expense	1,213		1,187		26		2.2
Total non-interest expense	$	28,194	$	29,336	$	(1,142)	(3.9)


	For the Year Ended
	September 30,				Change Expressed in:
	2023		2022		Dollars		Percent
	(Dollars in thousands)
NON-INTEREST INCOME:
Deposit service fees	$	12,745	$	13,798	$	(1,053)	(7.6)	%
Insurance commissions	3,487		2,947		540		18.3
Net loss from securities transactions	(205,967)		—		(205,967)		N/A
Other non-interest income	4,935		6,085		(1,150)		(18.9)
Total non-interest income	$	(184,800)	$	22,830	$	(207,630)	(909.5)


	For the Year Ended
	September 30,				Change Expressed in:
	2023		2022		Dollars		Percent
	(Dollars in thousands)
NON-INTEREST EXPENSE:
Salaries and employee benefits	$	51,491	$	56,600	$	(5,109)	(9.0)	%
Information technology and related expense	23,425		18,311		5,114		27.9
Occupancy, net	14,236		14,370		(134)		(0.9)
Regulatory and outside services	6,039		6,192		(153)		(2.5)
Federal insurance premium	4,456		3,020		1,436		47.5
Advertising and promotional	4,305		5,178		(873)		(16.9)
Deposit and loan transaction costs	2,694		2,797		(103)		(3.7)
Office supplies and related expense	2,499		1,951		548		28.1

Other non-interest expense	4,789		4,432		357		8.1
Total non-interest expense	$	113,934	$	112,851	$	1,083	1.0


			% of				Credit			Average
	Amount		Total		Rate		Score	LTV		Balance
	(Dollars in thousands)
Originated	$	3,978,837	61.0	%	3.39	%	772	60	%	$	164
Correspondent purchased	2,405,911		36.9		3.44		767	64		416
Bulk purchased	137,193		2.1		1.85		772	55		288
	$	6,521,941	100.0		3.37		770	61		213


	Count	Amount
	(Dollars in thousands)
Greater than $30 million	9	$	436,940
>$15 to $30 million	20	418,355
>$10 to $15 million	10	122,580
>$5 to $10 million	32	234,433
$1 to $5 million	143	339,856
Less than $1 million	1,217	185,888
	1,431	$	1,738,052


	Loans Delinquent for 30 to 89 Days at:
	September 30, 2023				June 30, 2023				March 31, 2023				December 31, 2022				September 30, 2022
	Number	Amount			Number	Amount			Number	Amount			Number	Amount			Number	Amount
	(Dollars in thousands)
One- to four-family:
Originated	88	$	9,078		67	$	6,377		45	$	4,116		56	$	4,708		48	$	4,134
Correspondent purchased	17	5,192			20	6,704			10	3,436			4	1,216			7	1,104
Bulk purchased	1	149			—	—			3	287			3	865			3	913
Construction	4	1,123			—	—			—	—			—	—			—	—
Commercial	5	94			6	573			5	389			6	191			—	—
Consumer	30	730			22	469			22	352			24	626			24	345
	145	$	16,366		115	$	14,123		85	$	8,580		93	$	7,606		82	$	6,496
30 to 89 days delinquent loans
to total loans receivable, net		0.21		%		0.18		%		0.11		%		0.10		%		0.09		%


	Non-Performing Loans and OREO at:
	September 30, 2023				June 30, 2023				March 31, 2023				December 31, 2022				September 30, 2022
	Number	Amount			Number	Amount			Number	Amount			Number	Amount			Number	Amount
	(Dollars in thousands)
Loans 90 or More Days Delinquent or in Foreclosure:
One- to four-family:
Originated	24	$	2,246		16	$	1,582		15	$	1,084		13	$	1,034		29	$	2,919
Correspondent purchased	9	3,410			8	1,854			7	1,803			14	4,126			12	3,737
Bulk purchased	2	942			3	1,149			3	1,212			4	1,492			3	1,148
Commercial	12	2,183			8	1,225			7	1,152			7	1,152			8	1,167
Consumer	9	113			3	51			7	51			11	126			9	154
	56	8,894			38	5,861			39	5,302			49	7,930			61	9,125

Loans 90 or more days delinquent or in foreclosure
as a percentage of total loans		0.11		%		0.07		%		0.07		%		0.10		%		0.12		%

Nonaccrual loans less than 90 Days Delinquent:(1)
One- to four-family:
Originated	2	$	215		3	$	295		2	$	187		3	$	219		3	$	222
Correspondent purchased	1	282			—	—			—	—			—	—			—	—
Bulk purchased	—	—			1	257			1	257			—	—			—	—
Commercial	1	18			2	29			3	104			2	84			1	77
Consumer	—	—			1	37			—	—			—	—			1	19
	4	515			7	618			6	548			5	303			5	318
Total nonaccrual loans	60	9,409			45	6,479			45	5,850			54	8,233			66	9,443

Nonaccrual loans as a percentage of total loans		0.12		%		0.08		%		0.07		%		0.11		%		0.13		%

OREO:
One- to four-family:
Originated(2)	—	$	—		—	$	—		2	$	160		2	$	161		4	$	307
Correspondent purchased	1	219			—	—			—	—			—	—			—	—



Consumer	—	—			—	—			—	—			1	21			1	21

	1	219			—	—			2	160			3	182			5	328
Total non-performing assets	61	$	9,628		45	$	6,479		47	$	6,010		57	$	8,415		71	$	9,771

Non-performing assets as a percentage of total assets		0.09		%		0.06		%		0.06		%		0.08		%		0.10		%


	Distribution of ACL				Ratio of ACL to Loans Receivable
	September 30,		June 30,		September 30,		June 30,
	2023		2023		2023		2023
	(Dollars in thousands)
One- to four-family	$	5,328	$	5,474	0.08	%	0.08	%
Commercial:
Commercial real estate	15,589		13,436		1.57		1.45
Commercial and industrial	1,104		929		0.98		0.87
Construction	1,487		2,321		0.83		1.20
Total	18,180		16,686		1.41		1.36
Consumer	251		239		0.24		0.23
Total	$	23,759	$	22,399	0.30		0.28


	Amount		Yield		WAL
	(Dollars in thousands)
MBS	$	1,053,600	1.65	%	4.7
U.S. government-sponsored enterprise debentures	519,985		0.64		1.9
Corporate bonds	4,000		5.12		8.6
Municipal bonds	1,029		2.55		6.9
	$	1,578,614	1.33		3.8


Maturity by			Contractual	Effective
Fiscal Year	Amount		Rate	Rate(1)
	(Dollars in thousands)

2024	990,000		4.30	3.79
2025	650,000		3.30	2.96
2026	575,000		2.81	2.95
2027	437,500		3.02	3.13
2028	230,328		4.94	3.91

	$	2,882,828	3.63	3.34


	December 31,			March 31,			June 30,			September 30,
	2023			2024			2024			2024			Total
	(Dollars in thousands)
Retail/Commercial Certificates:
Amount	$	264,988		$	270,160		$	409,119		$	423,970		$	1,368,237
Repricing Rate	2.60		%	2.89		%	3.84		%	4.37		%	3.58		%
Public Unit Certificates:
Amount	$	42,718		$	16,750		$	30,420		$	31,898		$	121,786
Repricing Rate	4.30		%	4.29		%	4.42		%	4.61		%	4.41		%
Term Borrowings:
Amount	$	150,000		$	65,000		$	600,000		$	175,000		$	990,000
Repricing Rate	3.42		%	2.70		%	4.25		%	2.92		%	3.79		%
Total
Amount	$	457,706		$	351,910		$	1,039,539		$	630,868		$	2,480,023
Repricing Rate	3.03		%	2.93		%	4.09		%	3.98		%	3.70		%


Retail certificates of deposit			1.3
Commercial certificates of deposit			1.0
Public unit certificates of deposit			0.6
Total certificates of deposit			1.2


	Amount		Yield/Rate		WAL	% of Category		% of Total
	(Dollars in thousands)
Securities	$	1,371,136	1.33	%	4.2			14.1	%
Loans receivable:
Fixed-rate one- to four-family	5,605,281		3.29		6.9	70.2	%	57.7
Fixed-rate commercial	456,087		4.44		3.1	5.7		4.7
All other fixed-rate loans	78,005		4.48		7.3	1.0		0.8
Total fixed-rate loans	6,139,373		3.39		6.7	76.9		63.2
Adjustable-rate one- to four-family	916,660		3.73		4.5	11.5		9.4
Adjustable-rate commercial	831,400		5.92		7.6	10.4		8.6
All other adjustable-rate loans	96,948		8.26		3.1	1.2		1.0
Total adjustable-rate loans	1,845,008		4.95		5.8	23.1		19.0
Total loans receivable	7,984,381		3.75		6.5	100.0	%	82.2
FHLB stock	110,714		9.22		2.1			1.2
Cash and cash equivalents	245,605		4.70		—			2.5
Total interest-earning assets	$	9,711,836	3.50		5.9			100.0	%

Non-maturity deposits	$	2,762,702	1.06		6.7	50.3	%	33.0	%
Retail certificates of deposit	2,533,954		3.47		1.3	46.1		30.2
Commercial certificates of deposit	48,751		3.56		1.0	0.9		0.6
Public unit certificates of deposit	147,487		4.44		0.6	2.7		1.8
Total interest-bearing deposits	5,492,894		2.28		4.0	100.0	%	65.6
Term borrowings	2,882,828		3.34		1.8			34.4


Total interest-bearing liabilities	$	8,375,722	2.65		3.2			100.0	%



For further information contact:
Kent Townsend						Investor Relations
Executive Vice President,						(785) 270-6055
Chief Financial Officer and Treasurer						investorrelations@capfed.com
(785) 231-6360
ktownsend@capfed.com