Washington Federal's fourth-quarter fiscal 2014 (ended Sep 30)
earnings outpaced the Zacks Consensus Estimate. Sustained top-line
growth and a benefit from provisions enhanced the quarterly
performance. However, mounting expenses acted as a headwind.
Washington Federal's steady capital deployment activities continue
to impress. Moreover, the company's efforts and focus to stay
aligned with its inorganic growth strategy is expected to be
further assisted by the rising demand for loans. Nonetheless, the
persistent low interest rate environment and weak expense
management make us apprehensive. Also, significant exposure to a
risky loan portfolio remains a matter of concern.
Headquartered in Seattle, WA, Washington Federal Inc. operates
as a non-diversified unitary savings and loan holding company. The
company conducts operations through its federally insured savings
and loan association subsidiary, Washington Federal Savings, with
251 offices across 8 western states.
Washington Federal's business primarily consists of attracting
deposits from general public and investing these funds in various
types of loans, including first-lien mortgages on single-family
dwellings, construction loans, land acquisition and development
loans, loans on multi-family and other income producing properties,
home equity loans and business loans. It also invests in certain
U.S. government and agency obligations, among others.
Washington Federal's deposit products include checking accounts,
passbook and statement accounts, money market accounts and time
deposits or certificate accounts. The company also engages in real
estate investment and insurance brokerage activities.
In 2007, Washington Federal acquired First Federal Banc of the
Southwest Inc. Further, in 2008, the company acquired First Mutual
Bancshares Inc. In 2010, the company acquired all the deposits of
Horizon Bank of Bellingham, Washington. In 2011, Washington Federal
acquired six branches from Charter Bank in New Mexico and three
branches of Phoenix, AZ-based failed Western National Bank.
In 2012, Washington Federal completed the divestiture of two of
its branches located in El Paso, TX. Further, the company acquired
Oregon-based South Valley Bancorp Inc.
In 2013, Washington Federal announced its conversion to a
national bank charter after receiving approval from the Office of
the Comptroller of the Currency (OCC). The company also received
approval from the Federal Reserve Bank of San Francisco to become a
bank holding company. In the same year, the company acquired 51
retail branches of Bank of America Corporation located in
Washington, Idaho, Oregon and New Mexico for $39 million.
In May 2014, Washington Federal completed the acquisition of 23
branches from Bank of America. These branches are located in
Arizona and Nevada.
Washington Federal operates with Sep 30 as its fiscal year-end.
As of Sep 30, 2014, the company had total assets of $14.8 billion,
cash and cash equivalents of $781.8 million and stockholders'
equity of $2.0 billion.
Washington Federal Inc. (WAFD): Read the Full
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