Exhibit 99

 

		WSFS Bank Center 500 Delaware Avenue, Wilmington, Delaware 19801		1

 

FOR IMMEDIATE RELEASE		Investor Relations Contact: Rodger Levenson
October 29, 2015		(302) 571-7296 rlevenson@wsfsbank.com
		Media Contact: Cortney Klein
		(302) 571-5253 cklein@wsfsbank.com

WSFS REPORTS 3Q 2015 EPS OF $0.51, ROA of 1.14%, ROTCE of 13.27%;

NET REVENUE GROWS 10% OVER THE THIRD QUARTER OF 2014 AND OPERATING

LEVERAGE ACCELERATES;

WSFS COMPLETES CURRENT 5% SHARE BUYBACK, AUTHORIZES ANOTHER 5%

BUYBACK AND INCREASES CASH DIVIDEND 20%

WILMINGTON, Del. — WSFS Financial Corporation (Nasdaq: WSFS), the parent company of WSFS Bank, reported net income of $14.4 million, or $0.51 per diluted common share for the third quarter of 2015 compared to net income of $11.4 million, or $0.41 per share for the third quarter of 2014 and net income of $12.2 million, or $0.43 per share for the second quarter of 2015.

Net income for the first nine months of 2015 was $39.5 million, or $1.39 per diluted common share, as compared to $41.0 million, or $1.49 per share for the same period of 2014. Results for the nine months of 2014 include a one-time tax benefit of $6.7 million, or $0.24 per share.

Highlights for the third quarter of 2015:

 

•

Core(n) earnings per share (EPS) of $0.53 (enumerated below) increased 13% from $0.47 for the third quarter of 2014.

 

•

Core(n) net revenue (excluding securities gains) increased $5.6 million, or 10% from the third quarter of 2014, reflecting strong organic growth and net interest margin improvement, whereas core(n) expenses increased only $1.3 million, or 4% from the third quarter of 2014, resulting in significant positive operating leverage and an improved efficiency ratio.

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		WSFS Bank Center 500 Delaware Avenue, Wilmington, Delaware 19801		2

 

Notable (Non-Core) items:

 

•

WSFS recorded $855,000 (pre-tax) or slightly more than $0.02 per share (after-tax) in expenses related to corporate development activities during the third quarter of 2015, primarily related to the successful acquisition of Alliance Bancorp, Inc. of Pennsylvania (Alliance), which was completed in October 2015.

 

•

WSFS realized $76,000, or well less than $0.01 per share in net gains on securities sales from its investment portfolio.

CEO outlook and commentary:

Mark A. Turner, President and CEO, said, “Our strong third quarter results reflect continued solid performance and growth. While the third quarter is seasonally slower, especially in fee income, we continue to make fundamental progress. Our year-over-year core revenues grew 10%, including strong gains in both our net interest margin and fee income, while core expenses grew at a much slower pace. This resulted in significant positive operating leverage and notable improvements in our efficiency ratio, EPS, ROA and ROTCE. We again showed steady progress towards our strategic goals, including achieving a core and sustainable 1.20% ROA in the fourth quarter of 2015.

“These results and good prospects for the future have allowed us to return greater amounts of capital to our shareholders. This quarter we completed our 5% share repurchase program announced in October 2014, and the Board authorized another 5% share repurchase plan. The Board also authorized a 20% increase in our quarterly cash dividend.

“Also, during the quarter, we ranked highly in The Wilmington News Journal’s ‘2015 Top Workplaces’ survey for the tenth consecutive year, and we were named the ‘Top Bank’ in Delaware for the fifth year in a row. We are honored by and value these accomplishments as evidence of the success of our strategy of ‘Engaged Associates delivering Stellar Service growing Customer Advocates and value for our Owners.’

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		WSFS Bank Center 500 Delaware Avenue, Wilmington, Delaware 19801		3

 

“Moreover, in early October we successfully completed our combination with Alliance Bank and we warmly welcome our new Associates and Customers and we look forward to serving these communities well, as WSFS has been doing for the last 183 years.”

Third Quarter 2015 Discussion of Financial Results

Continued solid growth in net interest income

Net interest income for the third quarter of 2015 was $41.0 million, an increase of $1.9 million or 5% (not annualized) compared to the second quarter of 2015. The net interest margin increased 8 basis points (bps) to 3.79%, including 4bps from positive performance on purchased loans and an additional 4bps from stronger performance in the reverse mortgage portfolio. As previously noted, the yield on both of these assets can be uneven from quarter to quarter. Net interest income also benefited from good growth and an improved balance sheet mix.

Compared to the third quarter of 2014, net interest income increased $4.3 million, or 12%, and net interest margin increased 9bps. Although we remain in a tight and highly competitive rate market, these substantial year-over-year increases in margin dollars and percentages were primarily due to successful organic and acquisition growth and an improving balance sheet mix.

Loan growth continues

At September 30, 2015, WSFS’ net loan portfolio increased $14.4 million, or 2% (annualized) to $3.36 billion when compared to June 30, 2015. This organic loan growth was spread over most loan categories and was muted by strong loan closings in the second quarter of 2015, a very competitive loan rate environment, construction loan pay-offs into the permanent market and the expected decrease in retail mortgage loans held-for-sale from healthy mortgage banking activities.

Compared to the third quarter of 2014, net loans increased $190.0 million, or 6%, reflecting strong organic growth.

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		WSFS Bank Center 500 Delaware Avenue, Wilmington, Delaware 19801		4

 

The following table summarizes loan balances and composition at September 30, 2015 compared to prior periods:

 

		At								At								At
(Dollars in Thousands)		September 30, 2015								June 30, 2015								Sept 30,2014
Commercial & industrial		$	1,748,042				52	%		$	1,728,457				52	%		$	1,689,272				53	%
Commercial real estate			868,002				26				864,053				25				788,189				25
Construction			201,596				6				200,328				6				146,833				5
Total commercial loans			2,817,640				84				2,792,838				83				2,624,294				83
Residential mortgage			234,368				7				261,703				8				256,349				8
Consumer			342,403				10				329,874				10				326,674				10
Allowance for loan losses			(36,412	)			(1	)			(40,845	)			(1	)			(39,484	)			(1	)
Net Loans		$	3,357,999				100	%		$	3,343,570				100	%		$	3,167,833				100	%

Strong trends continue in credit quality

Credit quality remained strong during the third quarter of 2015 despite higher charge-offs which were primarily the result of one large nonaccruing C&I loan, mentioned and provided for in the prior quarter.

Total nonperforming assets were $40.8 million at September 30, 2015, a $5.4 million, or 12% (not annualized) improvement from June 30, 2015. The nonperforming assets to total assets ratio improved to 0.81% from 0.91% at June 30, 2015. Delinquencies remained low at 0.53% of gross loans at September 30, 2015 (this ratio includes nonperforming delinquencies). In addition, classified loans declined by $5.8 million, or 6.0% from June 30, 2015 to $98.0 million, and the ratio of total classified loans to Tier 1 capital plus allowance for loan losses (ALLL) also improved to 17.00% at September 30, 2015 from 18.33% at June 30, 2015 and 28.69% at September 30, 2014.

Net charge-offs for the third quarter of 2015 were $5.9 million, or 70bps of total net loans on an annualized basis. The primary drivers were charge-offs of $3.8 million relating to the nonaccruing C&I relationship mentioned above and provided for last quarter, and $804,000 on one consumer loan.

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		WSFS Bank Center 500 Delaware Avenue, Wilmington, Delaware 19801		5

 

Total credit costs (provision for loan losses, loan workout expenses, OREO expenses and other credit reserves) were $1.6 million during the quarter ended September 30, 2015, a decrease from $4.0 million in the previous quarter (when the provision/reserve for the large C&I loan was taken), and an increase from $900,000 in the third quarter of 2014.

As a result of the charge-offs mentioned above and the overall improved credit quality statistics, the ratio of the ALLL to total gross loans declined to 1.08% at September 30, 2015, compared to 1.22% at June 30, 2015, and improved slightly to 152% of nonaccruing loans.

Total customer funding reflects continued strength in relationship accounts

Total customer funding increased by $75.4 million, or 2% (not annualized) from June 30, 2015 to $3.43 billion at September 30, 2015. The increase was driven by a $117.1 million, or 4% (not annualized) increase in core deposits including a $54.8 million increase in public funding accounts, which is seasonal. This increase was partially offset by a decrease of $39.0 million in time deposits. Time deposits decreased mainly due to allowing older, higher-rate CDs to run-off as a part of continued net interest margin management.

Total customer funding increased $154.7 million, or 5% from September 30, 2014. This was primarily due to a $304.2 million, or 11% increase in core deposits which was partially offset by a decrease of $144.1 million in time deposits, for reasons discussed above.

At September 30, 2015 core deposits represented a strong 88% of total customer funding, and no-cost and low-cost relationship checking deposit accounts represented 47% of total customer funding.

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		WSFS Bank Center 500 Delaware Avenue, Wilmington, Delaware 19801		6

 

The following table summarizes customer funding balances and composition at September 30, 2015 compared to prior periods:

 

		At								At								At
(Dollars in thousands)		September 30, 2015								June 30, 2015								September 30, 2014
Noninterest demand		$	904,896				26	%		$	875,955				26	%		$	814,203				25	%
Interest-bearing demand			727,816				21				697,365				21				689,544				21
Savings			388,213				11				419,864				13				405,157				12
Money market			1,015,985				30				926,583				27				823,781				25
Total core deposits			3,036,910				88				2,919,767				87				2,732,685				83
Customer time			384,110				11				423,066				12				528,258				16
Total customer deposits			3,421,020				99				3,342,833				99				3,260,943				99
Customer sweep accounts			11,621				1				14,433				1				16,978				1
Total customer funding		$	3,432,641				100	%		$	3,357,266				100	%		$	3,277,921				100	%

Fee income reflects strong growth over prior year

Fee income (noninterest income), which based on our mix of businesses can be very seasonal, increased $1.4 million, or 7% when compared to the same period a year ago. This included an increase in investment management and fiduciary revenue of $1.0 million and an increase in credit/debit card and ATM income of $267,000.

When compared to the second quarter of 2015, excluding securities gains, fee income decreased by $392,000, or 2%. The third quarter is typically seasonally lower than the second quarter due to declines in fiduciary income. Additionally, mortgage banking activities declined modestly from the prior quarter due to fluctuations in the rate environment and refinancing activity.

Total fee income for the quarter ended September 30, 2015 was 34% of total revenue and was well diversified among various sources: traditional banking, mortgage banking, wealth management and ATM services.

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		WSFS Bank Center 500 Delaware Avenue, Wilmington, Delaware 19801		7

 

Noninterest expense reflects focus on efficient growth

Noninterest expense for the third quarter of 2015 was $38.7 million, a decrease of $458,000 when compared to the third quarter of 2014. Excluding corporate development costs in both periods⁽ⁿ⁾, noninterest expense increased $1.3 million or only 4%. The increase in expenses reflects costs related to supporting our significant organic and acquisition growth. This modest increase in noninterest expense was more than offset by the year-over-year 10% increase in core⁽ⁿ⁾ net revenues, resulting in improved operating leverage and efficiency.

When compared to the second quarter of 2015, noninterest expense was essentially flat. Excluding corporate development costs, noninterest expense decreased $118,000, which reflects management’s continued focus on operating leverage and efficiency.

Selected Business Segments (included in previous results):

Wealth Management segment fee revenue grew by 24% over the prior year

The Wealth Management segment provides a broad array of fiduciary, investment management, credit and deposit products to clients through four businesses. WSFS Wealth Investments provides insurance and brokerage products primarily to our retail banking clients. Cypress Capital Management, LLC is a registered investment advisor with approximately $615 million in assets under management (AUM). Cypress’ primary market segment is high net worth individuals, offering a ‘balanced’ investment style focused on preservation of capital and providing for current income. Christiana Trust, with $8.8 billion in assets under management and administration, provides fiduciary and investment services to personal trust clients, and trustee, agency, bankruptcy administration, custodial and commercial domicile services to corporate and institutional clients. WSFS Private Banking serves high net worth clients by delivering credit and deposit products and partnering with other business units to deliver investment management and fiduciary products and services.

Total Wealth Management revenue (net interest income, investment management and fiduciary revenue and other fee income) was $8.6 million for the third quarter of 2015. This was an increase of $1.3 million, or 18% compared to the third quarter of 2014 and a decrease of $307,000, or 3% (not annualized) compared to the second quarter of 2015 which is typically seasonally stronger. Included in this increase, fee revenue grew $1.1 million, or 24% compared to the third quarter of 2014. This year-over-year improvement reflects the continued growth in several Wealth business lines, with particular strength in bankruptcy administration, trustee securitization appointments and retail brokerage services.

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		WSFS Bank Center 500 Delaware Avenue, Wilmington, Delaware 19801		8

 

Total noninterest expense (including intercompany allocations and provision for loan losses and credit costs) was $5.9 million during the third quarter of 2015 compared to $4.4 million during the third quarter of 2014 and $5.9 million during the second quarter of 2015. The 2015 increases are due to legal and consulting fees of $680,000 and $806,000 during the second and third quarter of 2015, respectively, as well as increased compensation for higher revenue, and other infrastructure costs necessary to support the significant growth of the business.

Pre-tax income in the third quarter of 2015 was $2.7 million compared to $2.9 million in the third quarter of 2014 and $3.1 million in the second quarter of 2015 and was impacted by the legal and consulting fees discussed above which relate to a small number of legacy trust accounts.

Cash Connect results show meaningful growth over 2014

Cash Connect^® is a premier provider of ATM vault cash and cash logistics services in the United States. Cash Connect^® services over 16,000 non-bank ATMs nationwide with $553 million in vault cash and also operates 452 ATMs for WSFS Bank, which has the largest branded ATM network in Delaware.

Cash Connect^® recorded $6.9 million in net revenue (fee income less funding costs) in the third quarter of 2015, an increase of $479,000, or 7% from the third quarter of 2014, reflecting continued organic growth. Net revenue also increased $71,000 compared to the second quarter of 2015. Noninterest expenses (including intercompany allocations of expense) were $4.9 million during the third quarter of 2015, an increase of $377,000 from the third quarter of 2014 and a decrease of $115,000 compared to the second quarter of 2015. Cash Connect^® reported pre-tax income of $2.0 million for the third quarter of 2015, which was relatively unchanged from the third quarter of 2014. Third quarter 2015 pre-tax income increased $185,000, or 10% when compared to the second quarter of 2015.

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		WSFS Bank Center 500 Delaware Avenue, Wilmington, Delaware 19801		9

 

Last quarter, WSFS retail banking and Cash Connect introduced “WSFS Mobile Cash”, offering security, convenience and speed in digital access to cash. It allows customers to securely withdraw cash from ATMs by using our WSFS Mobile Banking App. WSFS is first in the region and fourth in the United States to provide this service, and was the 2015 recipient of the “Most Innovative ATM Technology” Award by Networld, the publisher of ATM Marketplace and mobile Payments Today. This quarter, Cash Connect officially launched a new smart safe service which leverages Cash Connect‘s cash logistics expertise. Merchants place their cash into a smart safe which communicates the amount of cash deposited to Cash Connect. Cash Connect then provides the merchants with daily cash credits into their operating account and coordinates with carrier services to optimize the pick-up and processing of these deposits. Cash Connect recently moved this smart safe product out of pilot and into production with a strong national pipeline of opportunities in many quick-service, cash-intensive restaurants, gas station/convenience stores, and other retailers.

Income taxes

The Company recorded an $8.1 million income tax provision in the third quarter of 2015, compared to a $6.9 million tax provision in the second quarter of 2015 and a $6.1 million tax provision in the third quarter of 2014.

The effective tax rate was 35.9% in the third quarter of 2015, 36.0% in the second quarter of 2015 and 35.0% in the third quarter of 2014. The small variation in the effective rates is primarily due to certain nondeductible expenses associated with acquisition activity.

Capital management

Strong capital, earnings and prospects allows for greater return to owners

WSFS’ total stockholders’ equity increased $5.2 million to $505.6 million at September 30, 2015 from $500.4 million at June 30, 2015, primarily as a result of earnings and an increase in the market value of investments, partially offset by dividends and the Company’s recently completed stock buyback program.

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		WSFS Bank Center 500 Delaware Avenue, Wilmington, Delaware 19801		10

 

Similarly, WSFS’ tangible common equity⁽ⁿ⁾ increased to $449.3 million at September 30, 2015 from $443.3 million at June 30, 2015. WSFS’ tangible common equity to asset ratio⁽ⁿ⁾ increased by 13 basis points during the quarter to 8.96%. Tangible common book value per share⁽ⁿ⁾ was $16.40 at September 30, 2015, a $0.52 increase from June 30, 2015.

At September 30, 2015, WSFS Bank’s Tier I leverage ratio of 10.81%, Common Equity Tier 1 capital ratio and Tier 1 capital ratio of 12.91%, and total capital ratio of 13.80%, were all substantially in excess of the “well-capitalized” regulatory benchmarks.

In the third quarter of 2015, WSFS repurchased 561,914 shares of common stock at an average price of $27.75, effectively completing our 5% buyback program announced in October 2014.

Reflecting strong capital, earnings and prospects, on October 29, 2015, the Board of Directors approved a new share buyback program of up to an additional 5% of common stock outstanding. At that time the Board of Directors also approved a 20% increase in our quarterly cash dividend to $0.06 per share. This dividend will be paid on November 27, 2015 to shareholders of record as of November 13, 2015.

Third quarter 2015 earnings release conference call

Management will conduct a conference call to review third quarter results at 1:00 p.m. Eastern Time (ET) on Friday, October 30, 2015. Interested parties may listen to this call by dialing 1-877-312-5857. A rebroadcast of the conference call will be available one hour after the completion of the call, until Saturday, November 14, 2015, by dialing 1-855-859-2056 and using Conference ID 59503237.

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		WSFS Bank Center 500 Delaware Avenue, Wilmington, Delaware 19801		11

 

About WSFS Financial Corporation

WSFS Financial Corporation is a multi-billion dollar financial services company. Its primary subsidiary, WSFS Bank, is the oldest, locally-managed bank and trust company headquartered in Delaware and the Delaware Valley. As of September 30, 2015 WSFS Financial Corporation had $5.1 billion in assets on its balance sheet and $9.4 billion in fiduciary assets, including approximately $1.2 billion in assets under management. As of October 29, 2015, WSFS operates from 63 offices located in Delaware (44), Pennsylvania (17), Virginia (1) and Nevada (1) and provides comprehensive financial services including commercial banking, retail banking, cash management and trust and wealth management. Other subsidiaries or divisions include Christiana Trust, WSFS Wealth Investments, Cypress Capital Management, LLC, Cash Connect^®, Array Financial and Arrow Land Transfer. Serving the Delaware Valley since 1832, WSFS Bank is the seventh oldest bank in the United States continuously operating under the same name. For more information, please visit www.wsfsbank.com.

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		WSFS Bank Center 500 Delaware Avenue, Wilmington, Delaware 19801		12

 

Forward-Looking Statement Disclaimer

This press release contains estimates, predictions, opinions, projections and other “forward-looking statements” as that phrase is defined in the Private Securities Litigation Reform Act of 1995. Such statements include, without limitation, references to the Company’s predictions or expectations of future business or financial performance as well as its goals and objectives for future operations, financial and business trends, business prospects, and management’s outlook or expectations for earnings, revenues, expenses, capital levels, liquidity levels, asset quality or other future financial or business performance, strategies or expectations. Such forward-looking statements are based on various assumptions (some of which may be beyond the Company’s control) and are subject to risks and uncertainties (which change over time) and other factors which could cause actual results to differ materially from those currently anticipated. Such risks and uncertainties include, but are not limited to, those related to difficult market conditions and unfavorable economic trends in the United States generally, and particularly in the market areas in which the Company operates and in which its loans are concentrated, including the effects of declines in housing markets, an increase in unemployment levels and slowdowns in economic growth; the Company’s level of nonperforming assets and the costs associated with resolving any problem loans including litigation and other costs; changes in market interest rates may increase funding costs and reduce earning asset yields thus reducing margin; the impact of changes in interest rates and the credit quality and strength of underlying collateral and the effect of such changes on the market value of the Company’s investment securities portfolio; the credit risk associated with the substantial amount of commercial real estate, construction and land development, and commercial and industrial loans in our loan portfolio; the extensive federal and state regulation, supervision and examination governing almost every aspect of the Company’s operations including the changes in regulations affecting financial institutions, including the Dodd-Frank Wall Street Reform and Consumer Protection Act and the rules and regulations being issued in accordance with this statute and potential expenses associated with complying with such regulations; possible additional loan losses and impairment of the collectability of loans; the Company’s ability to comply with applicable capital and liquidity requirements (including the finalized Basel III capital standards), including our ability to generate liquidity internally or raise capital on favorable terms; possible changes in trade, monetary and fiscal policies, laws and regulations and other activities of governments, agencies, and similar organizations; any impairment of the Company’s goodwill or other intangible assets; failure of the financial and operational controls of the Company’s Cash Connect division; conditions in the financial markets that may limit the Company’s access to additional funding to meet its liquidity needs; the success of the Company’s growth plans, including the successful integration of past and future acquisitions; negative perceptions or publicity with respect to the Company’s trust and wealth management business; system failure or cybersecurity breaches of the Company’s network security; the Company’s ability to recruit and retain key employees; the effects of problems encountered by other financial institutions that adversely affect the Company or the banking industry generally; the effects of weather and natural disasters such as floods, droughts, wind, tornadoes and hurricanes as well as effects from geopolitical instability and man-made disasters including terrorist attacks; possible changes in the speed of loan prepayments by the Company’s customers and loan origination or sales volumes; possible acceleration of prepayments of mortgage-backed securities due to low interest rates, and the related acceleration of premium amortization on prepayments on mortgage-backed securities due to low interest rates; regulatory limits on the Company’s ability to receive dividends from its subsidiaries and pay dividends to its shareholders; the effects of any reputational, credit, interest rate, market, operational, legal, liquidity, regulatory and compliance risk resulting from developments related to any of the risks discussed above; and the costs associated with resolving any problem loans, litigation and other risks and uncertainties, discussed in the Company’s Form 10-K for the year ended December 31, 2014 and other documents filed by the Company with the Securities and Exchange Commission from time to time. Forward looking statements are as of the date they are made, and the Company does not undertake to update any forward-looking statement, whether written or oral, that may be made from time to time by or on behalf of the Company.

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		WSFS Bank Center 500 Delaware Avenue, Wilmington, Delaware 19801		13

 

WSFS FINANCIAL CORPORATION

FINANCIAL HIGHLIGHTS

STATEMENTS OF OPERATIONS

 

(Dollars in thousands, except per share data)		Three months ended												Nine months ended
(Unaudited)		September 30,				June 30,				September 30,				September 30,				September 30,
		2015				2015				2014				2015				2014
Interest income:
Interest and fees on loans		$	38,437			$	37,090			$	34,850			$	111,771			$	100,371
Interest on mortgage-backed securities			3,588				3,523				3,317				10,544				10,130
Interest and dividends on investment securities			875				852				837				2,587				2,443
Interest on reverse mortgage loans			1,561				1,166				1,323				3,963				3,917
Other interest income			396				424				472				1,898				1,136
			44,857				43,055				40,799				130,763				117,997
Interest expense:
Interest on deposits			1,587				1,825				1,823				5,354				5,193
Interest on Federal Home Loan Bank advances			868				751				663				2,332				1,850
Interest on trust preferred borrowings			343				339				332				1,009				988
Interest on senior debt			942				941				941				2,825				2,824
Interest on bonds payable			—				—				—				—				15
Interest on other borrowings			120				109				293				339				859
			3,860				3,965				4,052				11,859				11,729
Net interest income			40,997				39,090				36,747				118,904				106,268
Provision for loan losses			1,453				3,773				333				6,012				3,013
Net interest income after provision for loan losses			39,544				35,317				36,414				112,892				103,255
Noninterest income:
Credit/debit card and ATM income			6,486				6,462				6,219				18,975				17,995
Investment management and fiduciary revenue			5,373				5,707				4,332				16,173				12,453
Deposit service charges			4,338				4,099				4,477				12,342				13,092
Mortgage banking activities, net			1,251				1,590				1,229				4,544				3,066
Loan fee income			405				469				466				1,337				1,406
Investment securities gains, net			76				477				36				1,004				979
Bank-owned life insurance income			162				179				185				544				467
Other income			3,574				3,475				3,360				10,299				8,833
			21,665				22,458				20,304				65,218				58,291
Noninterest expense:
Salaries, benefits and other compensation			20,784				20,345				19,292				62,139				56,434
Occupancy expense			3,757				3,637				3,456				11,272				10,754
Equipment expense			2,059				1,959				2,063				6,100				5,610
Professional fees			2,039				1,753				1,762				5,264				5,083
Data processing and operations expense			1,570				1,459				1,609				4,451				4,611
Marketing expense			619				1,007				643				2,210				1,584
FDIC expenses			786				687				666				2,142				2,011
Corporate development expense			855				686				2,620				2,137				3,032
Loan workout and OREO expense			166				330				664				495				1,919
Other operating expenses			6,070				6,791				6,388				20,062				17,234
			38,705				38,654				39,163				116,272				108,272
Income before taxes			22,504				19,121				17,555				61,838				53,274
Income tax provision			8,078				6,887				6,142				22,289				12,225
Net income		$	14,426			$	12,234			$	11,413			$	39,549			$	41,049
Diluted earnings per share of common stock (p):
Net income allocable to common stockholders		$	0.51			$	0.43			$	0.41			$	1.39			$	1.49
Weighted average shares of common stock outstanding for fully diluted EPS			28,231,895				28,604,235				27,926,451				28,502,847				27,591,879
Performance Ratios:
Return on average assets (a)			1.14	%			0.98	%			0.99	%			1.06	%			1.20	%
Return on average equity (a)			11.41				9.61				10.17				10.44				12.91
Return on tangible common equity (a) (n)			13.27				11.18				11.60				12.15				14.58
Net interest margin (a)(b)			3.79				3.71				3.70				3.77				3.66
Efficiency ratio (c)			61.24				62.27				68.01				62.61				65.17
Noninterest income as a percentage of total net revenue (b)			34.28				36.18				35.26				35.12				35.09

See “Notes”

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		WSFS Bank Center 500 Delaware Avenue, Wilmington, Delaware 19801		14

 

WSFS FINANCIAL CORPORATION

FINANCIAL HIGHLIGHTS (Continued)

SUMMARY STATEMENTS OF CONDITION

 

(Dollars in thousands)
(Unaudited)		September 30,				June 30,				September 30,
		2015				2015				2014
Assets:
Cash and due from banks		$	94,756			$	108,928			$	95,473
Cash in non-owned ATMs			434,044				424,238				375,555
Investment securities (d)			169,167				149,750				153,525
Other investments			28,180				32,357				30,054
Mortgage-backed securities (d)			725,624				752,693				689,835
Net loans (e)(f)(l)			3,357,999				3,343,570				3,167,833
Reverse mortgage loans			24,476				25,945				29,392
Bank owned life insurance			77,053				76,891				76,276
Goodwill and intangibles			56,339				57,044				58,176
Other assets			100,304				106,067				106,609
Total assets		$	5,067,942			$	5,077,483			$	4,782,728
Liabilities and Stockholders’ Equity:
Noninterest-bearing deposits		$	904,896			$	875,955			$	814,203
Interest-bearing deposits			2,516,124				2,466,878				2,446,740
Total customer deposits			3,421,020				3,342,833				3,260,943
Brokered deposits			223,582				183,622				243,167
Total deposits			3,644,602				3,526,455				3,504,110
Federal Home Loan Bank advances			643,027				740,681				517,160
Other borrowings			225,352				260,219				240,079
Other liabilities			49,344				49,753				45,055
Total liabilities			4,562,325				4,577,108				4,306,404
Stockholders’ equity			505,617				500,375				476,324
Total liabilities and stockholders’ equity		$	5,067,942			$	5,077,483			$	4,782,728
Capital Ratios:
Equity to asset ratio			9.98	%			9.85	%			9.96	%
Tangible common equity to asset ratio (n)			8.96				8.83				8.85
Common equity Tier 1 capital (g) (required: 4.5%; well capitalized: 6.5%)			12.91				12.60				8.85
Tier 1 leverage (g) (required: 4.00%; well-capitalized: 5.00%)			10.81				10.59				11.01
Tier 1 risk-based capital (g) (required: 6.00%; well-capitalized: 8.00%)			12.91				12.60				13.65
Total Risk-based capital (g) (required: 8.00%; well-capitalized: 10.00%)			13.80				13.60				14.70
Asset Quality Indicators:
Nonperforming Assets:
Nonaccruing loans		$	23,916			$	27,719			$	26,776
Troubled debt restructuring (accruing)			13,616				13,610				14,215
Assets acquired through foreclosure			3,299				4,856				6,307
Total nonperforming assets		$	40,831			$	46,185			$	47,298
Past due loans (h)		$	918			$	208			$	678
Allowance for loan losses		$	36,412			$	40,845			$	39,484
Ratio of nonperforming assets to total assets			0.81	%			0.91	%			0.99	%
Ratio of nonperforming assets (excluding accruing TDRs)			0.54				0.64				0.69
Ratio of allowance for loan losses to total gross loans (i)			1.08				1.22				1.24
Ratio of allowance for loan losses to nonaccruing loans			152				147				147
Ratio of quarterly net charge-offs to average gross loans (a)(e)			0.70				0.29				0.29
Ratio of year-to-date net charge-offs to average gross loans (a)(f)			0.36				0.19				0.21

See “Notes”

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		WSFS Bank Center 500 Delaware Avenue, Wilmington, Delaware 19801		15

 

WSFS FINANCIAL CORPORATION

FINANCIAL HIGHLIGHTS (Continued)

AVERAGE BALANCE SHEET

 

(Dollars in thousands)
(Unaudited)		Three months ended
		September 30, 2015												June 30, 2015												September 30, 2014
		Average				Interest &				Yield/				Average				Interest &				Yield/				Average				Interest &				Yield/
		Balance				Dividends				Rate (a)(b)				Balance				Dividends				Rate (a)(b)				Balance				Dividends				Rate (a)(b)
Assets:
Interest-earning assets:
Loans: (e) (j)
Commercial real estate loans		$	1,076,077			$	12,630				4.69	%		$	1,002,843			$	11,803				4.71	%		$	885,953			$	10,670				4.82	%
Residential real estate loans (l)			249,645				2,516				4.03				255,302				2,510				3.93				245,085				2,345				3.83
Commercial loans			1,738,824				19,484				4.52				1,733,950				19,090				4.44				1,639,318				18,276				4.40
Consumer loans			335,487				3,807				4.50				327,581				3,687				4.51				317,053				3,559				4.45
Total loans (l)			3,400,033				38,437				4.54				3,319,676				37,090				4.49				3,087,409				34,850				4.53
Mortgage-backed securities (d)			743,312				3,588				1.93				751,006				3,523				1.88				689,123				3,317				1.92
Investment securities (d)			152,356				875				3.32				153,742				852				3.19				158,087				837				3.08
Reverse mortgage loans			25,485				1,561				24.50				26,931				1,166				17.32				31,435				1,323				16.83
Other interest-earning assets			31,346				396				5.01				28,715				424				5.92				34,535				472				5.42
Total interest-earning assets			4,352,532				44,857				4.14				4,280,070				43,055				4.08				4,000,589				40,799				4.13
Allowance for loan losses			(40,978	)											(39,924	)											(41,694	)
Cash and due from banks			88,855												88,124												84,647
Cash in non-owned ATMs			415,652												413,977												377,879
Bank owned life insurance			76,947												76,774												67,089
Other noninterest-earning assets			157,811												151,506												133,567
Total assets		$	5,050,819											$	4,970,527											$	4,622,077
Liabilities and Stockholders’ Equity:
Interest-bearing liabilities:
Interest-bearing deposits:
Interest-bearing demand		$	677,665			$	162				0.09	%		$	689,773			$	158				0.09	%		$	640,401			$	155				0.10	%
Money market			961,654				622				0.26				916,666				596				0.26				783,561				374				0.19
Savings			400,275				52				0.05				414,001				54				0.05				400,049				58				0.06
Customer time deposits			395,637				553				0.55				450,997				855				0.76				472,853				1,031				0.87
Total interest-bearing customer deposits			2,435,231				1,389				0.23				2,471,437				1,663				0.27				2,296,864				1,618				0.28
Brokered deposits			212,117				198				0.37				200,940				162				0.32				221,298				205				0.37
Total interest-bearing deposits			2,647,348				1,587				0.24				2,672,377				1,825				0.27				2,518,162				1,823				0.29
FHLB of Pittsburgh advances			693,202				868				0.50				636,327				751				0.47				611,327				663				0.42
Trust preferred borrowings			67,011				343				2.03				67,011				339				2.03				67,011				332				1.94
Senior Debt			55,000				942				6.85				55,000				941				6.84				55,000				941				6.84
Other borrowed funds			138,465				120				0.35				128,126				109				0.34				149,939				293				0.79
Total interest-bearing liabilities			3,601,026				3,860				0.43				3,558,841				3,965				0.45				3,401,439				4,052				0.48
Noninterest-bearing demand deposits			895,711												863,241												734,490
Other noninterest-bearing liabilities			48,405												39,483												37,137
Stockholders’ equity			505,677												508,962												449,011
Total liabilities and stockholders’ equity		$	5,050,819											$	4,970,527											$	4,622,077
Excess of interest-earning assets over interest-bearing liabilities		$	751,506											$	721,229											$	599,150
Net interest and dividend income						$	40,997											$	39,090											$	36,747
Interest rate spread
											3.71	%											3.63	%											3.65	%
Net interest margin(o)
											3.79	%											3.71	%											3.70	%

See “Notes”

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		WSFS Bank Center 500 Delaware Avenue, Wilmington, Delaware 19801		16

 

WSFS FINANCIAL CORPORATION

FINANCIAL HIGHLIGHTS (Continued)

 

(Dollars in thousands, except per share data)
(Unaudited)		Three months ended												Nine months ended
		September 30,				June 30,				September 30,				September 30,				September 30,
Stock Information (p):		2015				2015				2014				2015				2014
Market price of common stock:
High		$	29.15			$	27.81			$	25.22			$	29.15			$	25.87
Low			26.36				23.72				22.90				23.72				21.89
Close			28.81				27.35				23.87				28.81				23.87
Book value per share of common stock			18.46				17.93				16.90
Tangible common book value per share of common stock (n)			16.40				15.88				14.83
Number of shares of common stock outstanding (000s)			27,392				27,909				28,188
Other Financial Data:
One-year repricing gap to total assets (k)			3.55	%			0.62	%			1.32	%
Weighted average duration of the MBS portfolio			4.3 years				4.6 years				4.8 years
Unrealized gains (losses) on securities available-for-sale, net of taxes		$	4,543			$	(1,588	)		$	(3,384	)
Number of Associates (FTEs) (m)			893				900				822
Number of offices (branches, LPO’s, operations centers, etc.)			55				56				55
Number of WSFS owned ATMs			452				453				467

Notes:

(a)	Annualized.

(b)	Computed on a fully tax-equivalent basis.

(c)	Noninterest expense divided by (tax-equivalent) net interest income and noninterest income.

(d)	Includes securities available-for-sale at fair value.

(e)	Net of unearned income.

(f)	Net of allowance for loan losses.

(g)	Represents capital ratios of Wilmington Savings Fund Society, FSB and subsidiaries.

(h)	Accruing loans which are contractually past due 90 days or more as to principal or interest.

(i)	Excludes loans held-for-sale.

(j)	Nonperforming loans are included in average balance computations.

(k)	The difference between projected amounts of interest-sensitive assets and interest-sensitive liabilities repricing within one year divided by total assets, based on a current interest rate scenario.

(l)	Includes loans held-for-sale.

(m)	Includes seasonal Associates, when applicable.

(n)

The Company uses non-GAAP (Generally Accepted Accounting Principles) financial information in its analysis of the Company’s performance. This non-GAAP data should be considered in addition to results prepared in accordance with GAAP, and is not a substitute for, or superior to, GAAP results. See page 17.

(o)	Beginning in 2015, the annualization method used to calculate net interest margin was changed to actual/actual from 30/360. All periods net interest margin calculations were updated to reflect this change.

(p)	All stock information has been adjusted for the 3 for 1 stock dividend completed on May 18, 2015.

---

		WSFS Bank Center 500 Delaware Avenue, Wilmington, Delaware 19801		17

 

WSFS FINANCIAL CORPORATION

FINANCIAL HIGHLIGHTS (Continued)

 

(Dollars in thousands, except per share data)
(Unaudited)
		Three months ended												Nine months ended
		September 30,				June 30,				September 30,				September 30,				September 30,
Non-GAAP Reconciliation (n):		2015				2015				2014				2015				2014
Net interest Income (GAAP)		$	40,997			$	39,090			$	36,747			$	118,904			$	106,268
Less: FHLB Special Dividend			—				—				—				(808	)
Core net interest income			40,997				39,090				36,747				118,096				106,268
Noninterest Income (GAAP)			21,665				22,458				20,304				65,218				58,291
Less: Securities gains			(76	)			(477	)			(36	)			(1,004	)			(979	)
Core fee income (non-GAAP)			21,589				21,981				20,268				64,214				57,312
Core net revenue (non-GAAP)		$	62,586			$	61,071			$	57,015			$	182,310			$	163,580
Noninterest expense (GAAP)		$	38,705			$	38,654			$	39,163			$	116,272			$	108,272
Less: Corporate Development Costs			(855	)			(686	)			(2,620	)			(2,137	)			(3,032	)
Core noninterest expense (non-GAAP)		$	37,850			$	37,968			$	36,543			$	114,135			$	105,240
		End of period
		September 30,				June 30,				September 30,
		2015				2015				2014
Total assets		$	5,067,942			$	5,077,483			$	4,782,728
Less: Goodwill and other intangible assets			(56,339	)			(57,044	)			(58,176	)
Total tangible assets		$	5,011,603			$	5,020,439			$	4,724,552
Total Stockholders’ equity		$	505,617			$	500,375			$	476,324
Less: Goodwill and other intangible assets			(56,339	)			(57,044	)			(58,176	)
Total tangible common equity		$	449,278			$	443,331			$	418,148
Calculation of tangible common book value per share:
Book Value per share (GAAP)		$	18.46			$	17.93			$	16.90
Tangible common book value per share (non-GAAP)			16.40				15.88				14.83
Calculation of tangible common equity to assets:
Equity to asset ratio (GAAP)			9.98	%			9.85	%			9.96	%
Tangible common equity to asset ratio (non-GAAP)			8.96				8.83				8.85
		Three months ended												Nine months ended
		September 30,				June 30,				September 30,				September 30,				September 30,
		2015				2015				2014				2015				2014
GAAP net income		$	14,426			$	12,234			$	11,413			$	39,549			$	41,049
Less: Sec. gains, Special FHLB dividend, corp. dev. costs & income tax benefit, net of taxes			548				266				1,701				572				(5,226	)
Non-GAAP net income		$	14,974			$	12,500			$	13,114			$	40,121			$	35,823
Return on Average Assets (ROA)			1.14	%			0.98	%			0.99	%			1.06	%			1.20	%
Less: Sec. gains, Special FHLB dividend, corp. dev. costs & income tax benefit, net of taxes			0.04				0.02				0.15				0.02				(0.15	)
Non-GAAP ROA			1.18	%			1.00	%			1.14	%			1.08	%			1.05	%
GAAP EPS		$	0.51			$	0.43			$	0.41			$	1.39			$	1.49
Less: Sec. gains, Special FHLB dividend, corp. dev. costs & income tax benefit, net of taxes			0.02				0.01				0.06				0.02				(0.19	)
Core EPS (non-GAAP)		$	0.53			$	0.44			$	0.47			$	1.41			$	1.30