wfsl-20250930
United States
Securities and Exchange Commission
Washington, D.C. 20549
____________________________________________________________
FORM 10-K
____________________________________________________________
For the fiscal year ended September 30, 2025
OR
For the transition period from to
Commission File Number: 001-34654
____________________________________________________________
WAFD, INC.
(Exact name of registrant as specified in its charter)
____________________________________________________________
(Address of Principal Executive Offices) (Zip Code)
Registrant’s telephone number, including area code: (206) 624-7930
_____________________________________
Securities registered pursuant to Section 12(b) of the Act:
Title of each Class Trading Symbol(s) Name of each exchange on which registered
Common Stock, $1.00 par value per share WAFD NASDAQ Stock Market
Securities registered pursuant to section 12(g) of the Act:
None
____________________________________
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes☒ No ☐
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐No☒
Indicate by check mark whether the registrant (1) has filed all reports required by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the
past 90 days. Yes☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of
Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such
files). Yes☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an
emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and "emerging growth company" in
Rule 12b-2 of the Exchange Act.
Large accelerated filer ☒ Accelerated filer ☐
Non-accelerated filer ☐ Smaller reporting company ☐
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or
revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.☐
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control
over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its
audit report. Yes ☒ No ☐
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing
reflect the correction of an error to previously issued financial statements. ☐
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by
any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒
The aggregate market value of the registrant's common stock ("Common Stock") held on March 31, 2025, the last business day of the registrant's second fiscal
quarter by non-affiliates was $2,276,388,597 based on the NASDAQ Stock Market closing price of $28.58 per share on that date. This is based on 79,649,706
shares of Common Stock that were issued and outstanding on this date, which excludes 1,108,968 shares held by all affiliates.
At November 14, 2025, there were 76,701,002 shares of Common Stock outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
List hereunder the following documents incorporated by reference and the Part of Form 10-K into which the document is incorporated:
(1) Portions of the Registrant’s definitive proxy statement for its Annual Meeting of Shareholders to be held on February 3, 2026 are incorporated into Part III,
Items 10-14 of this Form 10-K.
WAFD, INC. AND SUBSIDIARIES
FORM 10-K ANNUAL REPORT
SEPTEMBER 30, 2025
PART I
Item 1. Business 6
Item 1A. Risk Factors 22
Item 1B. Unresolved Staff Comments 36
Item 1C. Cybersecurity 36
Item 2. Properties 38
Item 3. Legal Proceedings 38
Item 4. Mine Safety Disclosures 38
PART II
Item 6. [Reserved] 41
Item 7A. Quantitative and Qualitative Disclosures about Market Risks 56
Item 8. Financial Statements and Supplementary Data 61
Item 9A. Controls and Procedures 123
Item 9B. Other Information 125
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 125
PART III
Item 10. Directors, Executive Officers and Corporate Governance 125
Item 11. Executive Compensation 125
Item 14. Principal Accountant Fees and Services 126
PART IV
Item 15. Exhibits and Financial Statement Schedules 127
4
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS AND RISK FACTOR SUMMARY
WaFd, Inc. ("we" or the "Company") makes statements in this Annual Report on Form 10-K that constitute forward-
looking statements. Words such as “expects,” “anticipates,” “believes,” “estimates,” “intends,” “forecasts,” “projects” and other
similar expressions or future or conditional verbs such as “will,” “should,” “would” and “could” are intended to help identify
such forward-looking statements. These statements are not historical facts, but instead represent current expectations, plans or
forecasts of the Company and are based on the beliefs and assumptions of the management of the Company and the information
available to management at the time that these disclosures were prepared. The Company intends for all such forward-looking
statements to be covered by the safe harbor provisions for forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995 and the provisions of Section 27A of the Securities Act of 1933 and Section 21E of
the Securities Exchange Act of 1934. These statements are not guarantees of future results or performance and involve certain
risks, uncertainties and assumptions that are difficult to predict and often are beyond the Company's control. Actual outcomes
and results may differ materially from those expressed in, or implied by, the Company's forward-looking statements.
You should not place undue reliance on any forward-looking statement and should consider the following uncertainties
and risks, as well as the risks and uncertainties discussed elsewhere in this report, including under Item 1A. “Risk Factors,” and
in any of the Company's other subsequent Securities and Exchange Commission filings, which could cause the Company's
future results to differ materially from the plans, objectives, goals, estimates, intentions and expectations expressed in forward-
looking statements:
Operational Risks:
•fluctuating interest rates and the impact of inflation on the Company's business and financial results;
•risks associated with cybersecurity incidents and threat actors;
•risks associated with changes in business structure and divestitures of lines of business, including the Bank's exit from
the single family mortgage lending market;
•economic uncertainty or a deterioration in economic conditions or slowdowns in economic growth, including financial
stress on borrowers (consumers and businesses);
•risks associated with changes to monetary policy by the Federal Reserve;
•global economic trends, including developments related to Ukraine and Russia, the Middle East, and related negative
financial impacts on our borrowers, the financial markets and the global economy;
•risks associated with inflationary pressures and rising prices;
•risks associated with the development and use of artificial intelligence;
•risks related to operational, technological, and third-party provided technology infrastructure;
•risks associated with data privacy laws and regulations;
•possible additional provisions for loan losses and charge-offs; credit risks of lending activities and deterioration in
asset or credit quality; and our ability to make accurate assumptions and judgments about the collectability of our loan
portfolio, including the creditworthiness of our borrowers and the value of the assets securing these loans;
•risks associated with failures of our risk management framework;
•risks associated with our failure to retain or attract key employees;
•risks related to the impacts of climate change on our business or reputation;
•the effects of natural or man-made disasters, calamities, or conflicts, including terrorist events and pandemics (such as
the COVID-19 pandemic), related regulations, and potential impacts on the creditworthiness of our customers;
Regulatory and Litigation Risk:
•non-compliance with the Community Reinvestment Act, USA PATRIOT Act, Bank Secrecy Act, Home Mortgage
Disclosure Act, or other laws and regulations;
•legislative and regulatory limitations, and potential limitations in the manner in which the Company conducts its
business and undertakes new investments and activities;
•risks associated with changes in regulation, regulatory capital requirements or regulatory oversight, accounting rules,
and laws;
•risks associated with increases to deposit insurance premiums or special assessments;
•litigation risks resulting in significant expenses, losses and reputational damage;
•environmental risks resulting from our real estate lending business;
Market and Industry Risk:
•eroding confidence in the banking system and regional banks in particular;
•downturns in the real estate market;
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•changes in banking operations, including a shift from retail to online activities;
•risks associated with inadequate or faulty underwriting and loan collection practices;
•risks associated with our geographic concentration, including the effects of a severe economic downturn, including
high unemployment rates and declines in housing prices and both commercial and residential property values, in our
primary market areas;
•impairment of goodwill and other intangible assets;
Competitive Risks:
•competition from other financial institutions and new market participants, offering services similar to those offered by
the Bank, and consolidation in the industry resulting in the creation of larger competitors with greater financial
resources;
•the ability of the Company to obtain external financing to fund its operations or obtain financing on favorable terms,
when needed;
•our ability to grow organically or through acquisitions;
•risks associated with our entry into the California market;
Security Ownership Risks:
•negative effects of activist shareholders;
•our ability to continue to pay dividends, including on our outstanding Series A Preferred Stock; and make stock
repurchases;
•risks related to the volatility of our Common Stock, and future dilution;
•risks related to Washington's anti-takeover statute;
General Risks:
•the success of the Company at managing the risks involved in the foregoing and managing its business; and
•the timing and occurrence or non-occurrence of events that may be subject to circumstances beyond the Company's
control.
For the reasons described above, we caution you against relying on any forward-looking statements. You should not
consider the summary of such factors to be an exhaustive statement of all risks, uncertainties, or potentially inaccurate
assumptions that could cause our current expectations or beliefs to change. Further, all forward-looking statements speak only
as of the date on which such statements are made, and the Company undertakes no obligation to update or revise any forward-
looking statements to reflect changed assumptions, the occurrence of unanticipated events, changes to future operating results
over time, or the impact of circumstances arising after the date the forward-looking statement was made.
6
Item 1. Business
General
WaFd Bank, a federally-insured Washington state chartered commercial bank formerly known as Washington Federal Bank
(the "Bank" or "WaFd Bank"), was founded on April 24, 1917 in Ballard, Washington and is engaged primarily in providing
lending, depository, insurance and other banking services to consumers, small, mid-sized and large businesses, and owners and
developers of commercial real estate. Effective September 25, 2025, the Bank formally changed its name from Washington Federal
Bank to WaFd Bank by filing its Second Amended and Restated Articles of Incorporation with the Washington Secretary of State.
WaFd, Inc., a Washington corporation, was formed as the Bank’s holding company in November, 1994. As used throughout this
document, the terms "WaFd," the "Company" or "we" or "us" and "our" refer to WaFd, Inc. and its consolidated subsidiaries, and
the term "Bank" or "WaFd Bank" refers to its bank operating subsidiary. The Company is headquartered in Seattle, Washington.
On November 9, 1982 the Company listed and began trading on the NASDAQ. Profitable operations have been recorded
every year since going public. As of September 30, 2025, the stock traded at 82 times its original 1982 offering price, has paid 170
consecutive quarterly cash dividends and has returned 14,253% total shareholder return to those who invested 43 years ago.
On February 29, 2024, WaFd, Inc. closed its merger with Luther Burbank Corporation ("Luther Burbank" or "LBC"), a
California corporation, effective as of 12:00am on March 1, 2024. Pursuant to the Merger Agreement, at the Effective Time Luther
Burbank merged with and into the Company (the “Corporate Merger”), with the Company surviving the Corporate Merger.
Promptly following the Corporate Merger, Luther Burbank’s wholly-owned bank subsidiary, Luther Burbank Savings, merged with
and into WaFd Bank with WaFd Bank as the surviving institution (the “Bank Merger”). The Corporate Merger and the Bank Merger
are collectively referred to in this Annual Report on Form 10-K as the “Merger.” The Merger added approximately $7.7 billion of
LBC assets at fair value to the Company's balance sheet, and the Company assumed $50,175,000 in floating rate junior subordinated
debentures, due June 2036 and June 2037, and $93,514,000 in 6.5% senior unsecured term notes which matured and were paid off
on September 30, 2024. The Merger expanded WaFd Bank's footprint to nine western states with the addition of ten California
branches of Luther Burbank.
The Company's fiscal year end is September 30th. All references herein to 2025, 2024 and 2023 represent balances as of
September 30, 2025, September 30, 2024 and September 30, 2023, respectively, or activity for the fiscal years then ended.
The business of the Bank consists primarily of accepting deposits from the general public and investing these funds in loans of
various types, including construction loans, land acquisition and development loans, loans on multi-family, commercial real estate
and other income producing properties, and business loans, including U.S. Small Business Administration (“SBA”) loans. In
January, 2025, the Bank announced it will no longer originate consumer single family home loans and home equity lines of credit.
Our existing consumer home loans still make up a significant portion of our loan portfolio. The Bank also invests in certain United
States government and agency obligations and other investments permitted by applicable laws and regulations. As of September 30,
2025, WaFd Bank has 208 branches located in Washington, Oregon, Idaho, Arizona, Utah, Nevada, New Mexico, California and
Texas. The Bank delivers its financial products and services to customers through both its branch network and digital channels,
including its website and mobile banking application (information contained on our website and mobile application are not
incorporated by reference into this Annual Report on Form 10-K). The Company is also engaged in insurance brokerage activities
through the Bank’s subsidiary, WaFd Insurance Group, Inc., and wealth management products and services through WaFd Wealth,
Inc., a subsidiary of the Company.
The principal sources of funds for the Company's activities are retained earnings, loan repayments, net deposit inflows,
borrowings and repayments and sales of investments. WaFd's principal sources of revenue are interest on loans and interest and
dividends on investments. Its principal expenses are interest paid on deposits, credit costs, general and administrative expenses,
interest on borrowings and income taxes.
The Bank is subject to extensive regulation, supervision and examination by its primary state regulator, the Washington
State Department of Financial Institutions (the "WDFI"), the Federal Deposit Insurance Corporation ("FDIC"), its primary federal
regulator, which insures its deposits up to applicable limits, and the Consumer Financial Protection Bureau (the "CFPB"). The
Company, as a bank holding company, is subject to extensive regulation, supervision and examination by the Board of Governors of
the Federal Reserve System ("Federal Reserve").
The regulatory structure gives the regulatory authorities extensive discretion in connection with their supervisory and
enforcement activities. Any change in such regulation, whether by the WDFI, the FDIC, the Federal Reserve, the CFPB or the U.S.
Congress, could have a significant impact on the Company and its operations. See “WaFd Bank, wholly-owned operating subsidiary
— Regulation” section below.
7
Lending Activities
The Company's net loan portfolio totaled $20,088,618,000 at September 30, 2025 and represents 75.2% of total assets. Lending activities include the origination of
commercial loans secured by real estate, adjustable-rate construction loans, adjustable-rate land development loans, fixed-rate and adjustable-rate multi-family loans, fixed-
rate and adjustable-rate commercial real estate loans and fixed-rate and adjustable-rate business loans. Beginning in January 2025, the Bank announced it will no longer
originate consumer single family home loans and home equity lines of credit, however, existing consumer home loans still make up a significant portion of our loan
portfolio.
The following table is a summary of loans receivable by loan portfolio segment and class.
($ in thousands)
Gross loans by category
Commercial loans
Consumer loans
Less:
__________________
(1) The ACL within the table does not include the reserve for unfunded commitments which was $21,500,000, $21,500,000 and $24,500,000 as of
September 30, 2025, 2024 and 2023, respectively.
8
Lending Programs and Policies. The Bank's lending activities include commercial and consumer loans, including the
following loan categories.
Commercial real estate loans. The Bank makes loans on a variety of commercial real estate (“CRE”) types which are
generally secured by the subject property. Management differentiates multi-family properties from the rest of our CRE
portfolio as these loans have key differences in their risk profile.
The following table provides detail of the amortized cost of non-multi family CRE loans by property type:
($ in thousands)
Within the types listed above, a CRE subject property could be either owner or non-owner occupied. The following table
provides the amortized cost of CRE loans by occupation status:
($ in thousands)
In underwriting, the Bank considers a number of factors, which include the historic and projected net cash flows to the
loan's debt service requirement, the age and condition of the collateral, the financial resources and income level of the borrower
and the borrower's experience in owning or managing similar properties. CRE loans are originated in amounts up to 75% of the
appraised value of the property securing the loan.
With CRE loans, credit risk is a result of several factors, including the concentration of principal in a limited number of
loans and borrowers, the effects of general economic and societal conditions on income-producing properties and the primary
source of cash flow for repayment being spread across multiple tenants (non-owner). Repayment of CRE loans depends upon
the successful operation of the related real estate property. If the cash flow from the property is reduced, the borrower's ability
to repay the loan may be impaired. The Bank seeks to minimize these risks through its underwriting policies, which require
such loans to be qualified at origination on the basis of the property's income and debt service ratio.
Multi-family residential loans. Multi-family residential (five or more dwelling units) loans generally are secured by
multi-family rental properties, such as apartment buildings. In underwriting multi-family residential loans, the Bank considers
the same factors considered for CRE loans. Like CRE, multi-family residential loans are originated in amounts up to 75% of the
appraised value of the property securing the loan.
Loans secured by multi-family residential real estate generally involve different credit risk than single-family residential
loans and carry larger loan balances. This different credit risk is a result of several factors, including the concentration of
principal in a limited number of loans and borrowers, the effects of general economic and societal conditions on income-
9
producing properties, the primary source of cash flow for repayment being spread across multiple tenants, the effects of
government orders such as eviction forbearance and the increased difficulty of evaluating and monitoring these types of loans.
It is the Bank's policy to obtain title insurance ensuring that it has a valid first lien on the mortgaged real estate serving as
collateral for the loan. Borrowers must also obtain hazard insurance prior to closing and, when required by regulation, flood
insurance. Borrowers may be required to advance funds on a monthly basis, together with each payment of principal and
interest, to a mortgage escrow account from which the Bank makes disbursements for items such as real estate taxes, hazard
insurance premiums and private mortgage insurance premiums when due.
Commercial and industrial loans. The Bank makes various types of business loans to customers in its market area for
working capital, acquiring real estate, SBA program financing, financing equipment or other business purposes, such as
acquisitions. The terms of these loans generally range from less than one year to a maximum of ten years. The loans are either
negotiated on a fixed-rate basis or carry adjustable interest rates indexed to the Secured Overnight Funding Rate ("SOFR"),
Prime Rate or another market rate.
Commercial loans are made based upon assessment of the borrower's ability and willingness to repay along with an
evaluation of secondary repayment sources such as the value and marketability of collateral. Most such loans are extended to
closely held businesses and the personal guaranty of the principal is usually obtained. Commercial loans have a relatively high
risk of default compared to residential real estate loans. Pricing of commercial loans is based on the credit risk of the borrower
with consideration given to the overall relationship of the borrower, including deposits and contributed equity/loan-to-value
ratio. The acquisition of business deposits is an important focus of this business line. The Bank provides a full line of treasury
management products to support the depository needs of its customers.
Construction loans. The Bank originates construction loans to finance construction of single-family and multi-family
residences as well as commercial properties. Loans made to builders are generally tied to an interest rate index and normally
have maturities of two years or less or are structured such that they convert to a permanent loan after the completion of
construction or stabilization of the property. Legacy loans made to individuals for construction of their home generally are 30-
year fixed rate loans. The Bank's policies provided that for residential construction loans, loans may be made for 85% or less of
the construction cost or 80% of the appraised value of the property upon completion, whichever is less. As a result of activity
over the past four decades, the Bank believes that builders of single-family residences in its primary market areas consider the
Bank to be a construction lender of choice. Because of this history, the Bank has developed a staff with in-depth land
development and construction experience and working relationships with selected builders based on their operating histories
and financial stability.
Construction lending involves a higher level of risk than single-family residential lending due to the concentration of
principal in a limited number of loans and borrowers and the effects of general economic conditions in the home building
industry. Moreover, a construction loan can involve additional risks because of the complexities of completing the
construction, the inherent difficulty in estimating the cost (including interest) of the project, the future cash flows and the
property's value at completion of the project.
Land development loans. The Bank's land development loans are of a short-term nature and are generally made for 75%
or less of the appraised value of the unimproved property. Funds are disbursed periodically at various stages of completion as
authorized by the Bank's personnel. The interest rate on these loans typically adjust daily or monthly in accordance with a
designated index.
Land development loans involve a higher degree of credit risk than long-term financing on owner-occupied real estate.
Mitigation of risk of loss on a land development loan is dependent largely upon the accuracy of the initial estimate of the
property's value at completion of development compared to the estimated cost (including interest) of development and the
financial strength of the borrower.
Consumer loans. The Bank's non-mortgage consumer loan portfolio consists of prime quality student loans acquired
from an independent financial investment firm that retains 1% of each loan, plus various other non-mortgage consumer loans
including personal lines of credit and credit cards.
Single-family residential loans. In January 2025, the Bank announced its exit from the single-family mortgage lending
market, including home equity lines of credit ("HELOC"). Prior to this exit, the Bank originated 30-year fixed-rate mortgage
loans and HELOCs secured by single-family residences. Mortgage lending prior to exit was subject to written,
nondiscriminatory underwriting standards, loan origination procedures and lending policies approved by the Company's Board
of Directors (the "Board"). Although the Bank is no longer originating these loans, there are currently no plans to sell loans
from the existing portfolio.
10
Property valuations were required on all real estate loans. Appraisals were prepared by independent appraisers, reviewed
by staff of the Bank, and approved by the Bank's management. Property evaluations were sometimes utilized in lieu of
appraisals on single-family real estate loans of $250,000 or less and were reviewed by the Bank's staff. Detailed loan
applications were obtained to determine the borrower's ability to repay and the more significant items on these applications are
verified through the use of credit reports, financial statements or written confirmations.
Depending on the size of the loan involved, a varying number of officers of the Bank must approve the loan application
before the loan could be granted. Federal guidelines limit the amount of a real estate loan made to a specified percentage of the
value of the property securing the loan, as determined by an evaluation at the time the loan is originated. This is referred to as
the loan-to-value ratio. The Board sets the maximum loan-to-value ratios for each type of real estate loan offered by the Bank.
When establishing general reserves for loans with loan-to-value ratios exceeding 80% that are not insured by private
mortgage insurance, the Bank considers the additional risk inherent in these products, as well as their relative loan loss
experience, and provides reserves when deemed appropriate. The total balance for loans with loan-to-value ratios exceeding
80% at origination as of September 30, 2025, was $136,605,000, with allocated reserves of $1,256,000.
Origination and Purchase of Loans. The Bank has general authority to lend anywhere in the United States; however, its
primary lending areas are within the states of Washington, Oregon, Idaho, Arizona, Utah, Nevada, New Mexico, California and
Texas. Loan originations come from a variety of sources, although most business purpose loans are obtained primarily by
direct solicitation of borrowers and ongoing relationships.
The Bank also purchases loans and mortgage-backed securities when lending rates and volume for new loan
originations in its market area do not fulfill its needs.
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The table below shows the Bank's total loan origination, purchase and repayment activities.
(In thousands)
Commercial loan originations (1)
Consumer loan originations (1)
___________________
(1)Includes undisbursed loan in process.
(2)Includes non-cash transactions.
(3)Loans purchased in fiscal 2024 refer to those obtained in the Merger
(4)Loans sold in fiscal 2024 refer to multi-family and single-family residential loans obtained in the Merger and were classified as held
for sale.
Interest Rates, Loan Fees and Service Charges. Interest rates charged by the Bank on loans are primarily determined by the
competitive loan rates offered in its lending areas and in the secondary market. Loan rates reflect factors such as general interest
rates, the supply of money available to the industry and the demand for such loans. General economic conditions, the regulatory
programs and policies of federal and state agencies, including the Federal Reserve Bank’s monetary policies, changes in tax
laws and governmental budgetary programs influence these factors.
The Bank receives fees for originating loans in addition to various fees and charges related to existing loans, including
prepayment charges, late charges and assumption fees. The Bank normally charges an origination fee and as part of the loan
application, the borrower paid the Bank for out-of-pocket costs, such as the appraisal fee, whether or not the borrower closes
the loan. The interest rate charged is normally the prevailing rate at the time the loan application is approved and accepted.
Investment Activities
The Bank is obligated by its regulators to maintain adequate liquidity and does so by holding cash and cash equivalents
and by investing in securities. These investments may include, among other things, certain certificates of deposit, repurchase
agreements, bankers’ acceptances, loans to financial institutions whose deposits are federally-insured, federal funds, corporate
and municipal debt, United States government and agency obligations and mortgage-backed securities.
12
Sources of Funds
General. Deposits are the primary source of the Bank’s funds for use in lending and other general business purposes. In
addition to deposits, the Bank derives funds from loan repayments, advances from the Federal Home Loan Bank of Des Moines
("FHLB - DM"), borrowings from the Federal Reserve Bank ("FRB"), and from investment repayments and sales. Loan
repayments are a relatively stable source of funds influenced by prevailing market rates that drive refinancing activity, while
deposit inflows and outflows are influenced by both market and offered interest rates, money market conditions, the availability
of FDIC insurance and the market perception of the Company’s financial stability. Borrowings may be used on a short-term
basis to compensate for reductions in normal sources of funds, such as deposit inflows at lower than projected levels.
Borrowings may also be used on a longer-term basis to support expanded activities and to manage interest rate risk. Borrowing
capacity and availability is influenced by interest rates, market conditions, availability of collateral and the market's perception
of the Bank's financial stability.
Deposits. The Bank relies on a mix of deposit types, including business and personal checking accounts, term certificates of
deposit, and other savings deposit alternatives that have no fixed term, such as money market accounts and passbook savings
accounts. The Bank offers several consumer checking account products, both interest bearing and non-interest bearing and
several business checking accounts, some of which target small businesses with relatively simple and straightforward banking
needs and some for larger, more complex business depositors with an account that prices monthly based on the volume and type
of activity. Savings and money market accounts are offered to both businesses and consumers, with interest paid after certain
threshold amounts are exceeded.
The Bank’s deposits are obtained primarily from residents of Washington, Oregon, Idaho, Arizona, Utah, Nevada, New
Mexico, California and Texas.
Borrowings. The Bank has a credit line with the FHLB - DM for up to 45% of total assets depending on specific collateral
eligibility. The Bank obtains advances from the FHLB - DM based upon the security of the FHLB capital stock it owns and
certain of its loans, provided certain standards related to credit worthiness have been met. Such advances are made pursuant to
several different credit programs. Each credit program has its own interest rate and range of maturities, and the FHLB - DM
prescribes acceptable uses to which the advances pursuant to each program may be put, as well as limitations on the size of such
advances. Depending on the program, such limitations are based either on a fixed percentage of assets or the Company's credit
worthiness. FHLB advances are used to meet seasonal and other withdrawals of deposit accounts and to fund expansion of the
Bank's lending.
The Bank may need to borrow funds for short periods of time to meet day-to-day financing needs. In these instances,
funds are borrowed from other financial institutions or the Federal Reserve Bank, for periods generally ranging from one to
seven days at the then current borrowing rate.
The Bank also participates in the FRB of San Francisco Borrower-in-Custody program which collateralizes primary credit
borrowings and serves as a backstop for the FHLB - DM credit line. Due to differing program requirements between the FHLB
- DM and FRB of San Francisco, participating in both increases the amount of eligible collateral that may be pledged in support
of contingent liquidity needs.
The Bank Merger with LBC provided a credit line with the Federal Home Loan Bank of San Francisco (FHLB - SF) in
support of LBC borrowings, but the Bank is unable to take down new advances against this line as the Bank is not allowed to
belong to more than one FHLB. The FHLB - SF credit line is secured by a line-item pledge of securities.
For further information on these activities, see Note L to the Consolidated Financial Statements in “Item 8. Financial
Statements and Supplementary Data” of this report.
Subsidiaries
The Company is a bank holding company that conducts its primary business through its wholly-owned subsidiary, WaFd
Bank. The Company has nine active direct and indirect wholly-owned subsidiaries, discussed further below.
WAFD Insurance Group, Inc. is incorporated under the laws of the state of Washington and is an insurance agency that
offers a full line of individual and business insurance policies to customers of the Bank, as well as to the general public. As of
September 30, 2025 and September 30, 2024, WAFD Insurance Group, Inc. had total assets of $22,465,000 and $23,174,000,
respectively.
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Statewide Mortgage Services Company is incorporated under the laws of the state of Washington and it holds and
markets real estate owned. As of September 30, 2025 and September 30, 2024, Statewide Mortgage Services Company had
total assets of $2,472,000 and $2,506,000, respectively.
Washington Services, Inc. is incorporated under the laws of the state of Washington. It acts as a trustee under deeds of
trust as to which the Bank is beneficiary. As of both September 30, 2025 and September 30, 2024, Washington Services, Inc.
had total assets of $13,000.
WAFD Wealth, Inc. is a subsidiary of the Company and is incorporated under the laws of the state of Deleware and offers
personalized financial guidance and investment services. As of September 30, 2025, WAFD Wealth, Inc. had total assets of
$4,784,000. WAFD Wealth was not a subsidiary as of September 30, 2024.
Pike Street Labs, Inc. is incorporated under the laws of the state of Washington. It provides technology and data services
to the Bank. As of September 30, 2025, Pike Street Labs, Inc. had total assets of $4,644,000. Pike Street Labs, Inc. was not a
subsidiary as of September 30, 2024.
The Company also owns Burbank Financial Inc., an inactive real estate investment company, and all the common interests
in Luther Burbank Statutory Trusts I and II, entities created to issue trust preferred securities that were acquired in connection
with the Merger. The Company also obtained in the Merger with LBC a LIHTC investment in Raymond James Housing
Opportunities Fund 76 LLC, a Florida limited liability company. WaFd is the only investor member and is allocated 99.99% of
any tax credits and operating profits and losses from the LLC but the day-today management and control is in the hands of the
management member, and affiliate of Raymond James Financial, Inc.
Human Capital
At WaFd Bank, our culture is defined by our corporate values of integrity, teamwork, ownership, simplicity, service and
discipline. We value our employees by investing in a healthy work-life balance, competitive compensation and benefit packages
and a vibrant, team-oriented environment centered on professional service and open communication amongst employees. We
strive to build and maintain a high-performing culture and be an “employer of choice” by creating a work environment that
attracts and retains outstanding, engaged employees who embody our company mantra of “Love what you do. Make a
difference.”
Demographics. As of September 30, 2025, we employed 2037 full and part time employees. None of these employees
are represented by a collective bargaining agreement. During fiscal year 2025 we hired 441 employees. Our voluntary turnover
rate was 18.12% in fiscal year 2025, an increase from 15.80% in 2024.
As of September 30, 2025, the population of our workforce was as follows:
Headcount by Ethnicity & Gender 2025
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Learning and Development. We invest in the growth and development of our employees by providing a multi-
dimensional approach to learning that empowers, intellectually grows, and professionally develops our colleagues. Our
employees, including leadership, receive continuing education courses that are relevant to the banking industry and their job
function within the Company. All new employees attend our two-day new hire orientation, Welcome to WaFd. In addition, we
offer our Education Tuition Assistance Program, designed to encourage an employee's advancement and growth. We also offer
the Retail Bank Peer Mentor Program and branch banking certifications for our branch employees. These resources provide
employees with the skills they need to achieve their career goals, build management skills and become leaders within our
Company.
Compensation and Benefits.We provide a competitive compensation and benefits program to help meet the needs of
our employees. In addition to salaries, these programs include annual bonuses, stock awards, a 401(k) Plan with an employer
matching contribution in addition to an employer annual contribution, healthcare and insurance benefits, health savings, flexible
spending accounts, paid time off, family leave and an employee assistance program.
Workplace Safety & Wellness. We prioritize the importance of our employees’ health and the health of their families.
We offer healthcare plans where the Company pays a significant portion of the monthly premiums for employees and their
children. Our benefits program also includes a Health Savings Account ("HSA") option in addition to Flexible Spending
Accounts ("FSA"). We believe maintaining a competitive benefits program is a sound investment in attracting newcomers and
retaining loyal, dedicated and enthusiastic colleagues. Benefits we offer to employees include:
•Health insurance including dental & vision.
•Flexible spending plans for healthcare and childcare expenses.
•Employer-paid life insurance & accidental death and dismemberment coverage.
•Long-term disability insurance.
•Employee assistance program to provide access to counseling and support well-being.
Corporate Social and Environmental Responsibility
We recognize the social and environmental responsibility that arises from the impact of our activities on peoples’ lives
and our community. The Company's Corporate and Social Environmental Policy integrates social, environmental and ethical
concerns into our daily business activities and our approach to stakeholder relationships. Through this policy, we strive to carry
out our banking activities in a responsible manner, placing the financial needs of our customers and economic health of our
communities at the core of our focus. Below is a summary of our community activities and financial contributions in 2025.
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The Company
General. The Company is registered as a bank holding company and is subject to regulation, examination, supervision and
reporting requirements of the Federal Reserve Bank.
Regulation. The Company operates in a highly regulated industry. The regulatory structure governing the Company’s
operations is designed primarily for the protection of the deposit insurance funds and consumers, and not to benefit our
shareholders. As part of this regulatory structure, the Company is subject to policies and other guidance developed by the
regulatory agencies with respect to capital levels, the timing and amount of dividend payments, the classification of assets and
the establishment of adequate loan loss reserves for regulatory purposes. Under this structure, regulators have broad discretion
to impose restrictions and limitations on the Company’s operations if they determine, among other things, that such operations
are unsafe or unsound, fail to comply with applicable law or are otherwise inconsistent with laws and regulations or with the
supervisory policies of these agencies.
Failure to comply with applicable laws and regulations can result in a range of sanctions and enforcement actions,
including the imposition of civil money penalties, formal agreements and cease and desist orders. In order to ensure the
Company's programs and operations are in compliance with regulatory requirements, the Company has and will continue to
incur significant costs in order to comply in accordance with its responsibilities.
For further information on regulatory matters, see Note A to the Consolidated Financial Statements in “Item 8. Financial
Statements and Supplementary Data” as well as the "Risk Factors" section of this report and the "USA Patriot Act of 2001"
discussion below.
Sections below include a description of certain laws and regulations that relate to the regulation of the Company and the
Bank. The description of these laws and regulations, and descriptions of laws and regulations contained elsewhere herein, do
not purport to be complete and are qualified in their entirety by reference to applicable laws and regulations.
Restrictions on Activities and Acquisitions. Bank holding companies are subject to a variety of restrictions on their activities
and the acquisitions they can make. Generally, the activities or acquisition of a bank holding company that is not a financial
holding company are limited to those that constitute banking or managing or controlling banks or which are closely related to
banking. In addition, without the prior approval of the FRB, bank holding companies are generally prohibited from acquiring
more than 5% of the outstanding shares of any class of voting securities of a bank or bank holding company, taking any action
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that causes a bank to become a subsidiary of the bank holding company, acquiring all or substantially all of the assets of a bank,
or merging with another bank holding company.
Control of Company or Bank. Pursuant to the Change in Bank Control Act, (the “CIBC Act”) individuals, corporations or
other entities acquiring Company equity interests may, alone or together with other investors, be deemed to control a holding
company or a bank. If an acquisition is deemed to constitute control of the holding company or bank and is not subject to
approval under the Bank Holding Company Act or certain other statutes, such person or group will be required to file a notice
under the CIBC Act. Generally, ownership of, or power to vote, more than 25% of any class of voting securities constitutes
control. In the case of a bank or bank holding company the securities of which are registered with the SEC, ownership of or
power to vote more than 10% of any class of voting securities creates a presumption of control.
Source of Strength. Under long-standing FRB policy, a bank holding company is expected to serve as a source of financial and
management strength to its subsidiary bank. Under this policy, a bank holding company is expected to stand ready to provide
adequate capital funds to its subsidiary bank during periods of financial adversity and to maintain financial flexibility and
capital raising capacity to assist its subsidiary bank. The Dodd-Frank Act codified the source of strength doctrine by adopting a
statutory provision requiring, among other things, that bank holding companies serve as a source of financial strength to their
subsidiary banks.
Restrictions on Company Dividends. The Company’s ability to pay dividends to its shareholders is affected by several
factors. Since the Company is a separate legal entity from the Bank and its subsidiaries and does not have significant operations
of its own, the Company may not be able to pay dividends to its shareholders if the Bank is unable to pay dividends to the
Company. The Bank’s ability to pay dividends is subject to various regulatory restrictions.
In addition, the Company’s ability to pay dividends is subject to rules and policies of the FRB. It is the policy of the
Federal Reserve that bank holding companies should pay cash dividends only out of income available over the past year and
only if prospective earnings retention is consistent with the company’s expected future needs and financial condition. Capital
rules adopted by the Federal Reserve, effective January 2015, may limit the Company’s ability to pay dividends if the Company
fails to meet certain requirements under the rules. In addition, if we do not or are unable to pay quarterly dividends on our
Series A Preferred Stock, we may not pay a dividend to the holders of our Common Stock. See “WaFd Bank, wholly-owned
operating subsidiary - Restrictions on Dividends” below.
Since the Company is a Washington state corporation, it is also subject to restrictions under Washington corporate law
relating to dividends. Generally, under Washington law, a corporation may not pay a dividend if, after giving effect to the
dividend, the corporation would be unable to pay its liabilities as they become due in the ordinary course of business or the
corporation’s total assets would be less than the sum of its total liabilities plus (with some exceptions) the amount that would be
needed, if the corporation were to be dissolved at the time of the dividend payment, to satisfy the dissolution preferences of
senior equity securities.
Enterprise Risk Management. The Company faces a number of risks, including credit risk, interest rate risk, liquidity risk,
operations risk, cybersecurity risk, regulatory risk, compliance and legal risk, strategic risk, and reputational risk. The Risk
Management Committee of the Board (“RMC”) establishes the Company's risk appetite and sets appropriate risk limits and
policies. The RMC is responsible for providing ongoing review, guidance and oversight of the Company's enterprise risk
management function. Management is responsible for managing the Company's risks on a day-to-day basis in accordance with
the policies established by the Board.
The Company's Chief Risk Officer (“CRO”) chairs the Enterprise Risk Management Committee (“ERMC”), a
management-level committee that is responsible for executing the risk management framework adopted by the Board. The
ERMC maintains enterprise-wide oversight of risk assessment, monitoring and reporting. The ERMC meets at least quarterly
to identify, evaluate, monitor, and account for new, existing and emerging risks to the Company. Identified risks are evaluated,
analyzed, prioritized and tracked by the ERMC in a manner to be compatible with effective internal controls, risk management
practices and the policies adopted by the Board. The ERMC develops risk management programs and processes to incorporate
risk considerations into day-to-day business activities across the Company’s risk categories, business lines and functions. To
support the ERMC’s risk management function, certain types of risks are overseen by other management level committees. For
example, the Company’s Asset Liability Committee is responsible for managing interest rate and liquidity risks and the credit
administration department tracks credit risks.
On at least a quarterly basis, the Company’s CRO, Chief Financial Officer, Chief Information Officer, Chief Information
Security Officer, Chief Credit Officer, and other members of management report directly to the RMC to provide reporting on
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risk levels, key risks, emerging risks and the Company’s compliance with the risk management framework, risk limits and risk
appetites adopted by the RMC.
The Company carries out its risk management practices through its “three lines of defense” model, which is designed to
establish effective checks and balances within its risk management framework. The first line of defense is business units and
process owners within the Company which are responsible for maintaining effective internal controls and executing risk and
control procedures on a day to day basis. The second line of defense is the Company’s risk management, compliance and other
control functions which are responsible for ensuring that the first line of defense is properly designed, in place, and operating
effectively. The third line of defense is the Company’s internal audit function, which provides independent assessment and
assurance regarding the effectiveness of governance, risk management and internal controls.
WaFd Bank, wholly-owned operating subsidiary
General. The Bank is a federally-insured Washington state chartered commercial bank. The WDFI is the Bank's primary state
regulator and the FDIC is its primary federal regulatory. The Bank is a member of the FDIC and its deposits are insured up to
applicable limits of the Depository Insurance Fund (“DIF”), which is administered by the FDIC.
Regulation. The WDFI and FDIC have extensive authority over the operations of the Bank. As part of this authority, the Bank
is required to file periodic reports with and is subject to periodic examinations by both the WDFI and FDIC. As a Washington
state chartered commercial bank with branches in the states of Washington, Oregon, Idaho, Utah, Nevada, Arizona, New
Mexico, California and Texas, the Bank is subject not only to the applicable laws and regulations of Washington State, but is
also subject to the applicable laws and regulations of these other states in which it does business. Various laws and regulations
prescribe the investment and lending authority of the Bank, and the Bank is prohibited from engaging in any activities not
permitted by such laws and regulations. While the Bank has broad authority to engage in all types of lending activities, a variety
of restrictions apply to certain other investments by the Bank, as discussed below.
Interstate Banking. Subject to certain limitations and restrictions, a bank holding company, with prior approval of the FRB,
may acquire an out-of-state bank; banks in states that do not prohibit out-of-state mergers may merge with the approval of the
appropriate federal banking agency, and a bank may establish a de novo branch out of state if such branching is permitted by
the other state.
Insurance of Deposit Accounts. Under the Dodd-Frank Act, the maximum amount of federal deposit insurance coverage was
permanently increased from $100,000 to $250,000 per depositor, per institution. The Dodd-Frank Act also broadened the base
for FDIC insurance assessments. Assessments are now based on the average consolidated total assets less tangible equity capital
of a financial institution. In addition, the Dodd-Frank Act raised the minimum designated reserve ratio, which the FDIC is
required to set each year for the DIF, to 1.35%. The Dodd-Frank Act eliminated the requirement that the FDIC pay dividends to
depository institutions when the reserve ratio exceeds certain thresholds. The FDIC has established a higher reserve ratio of 2%
as a long-term goal beyond what is required by statute.
Brokered Deposits. The Federal Deposit Insurance Act prohibits an insured depository institution from accepting brokered
deposits or offering interest rates on any deposits significantly higher than the prevailing rate in the bank’s normal market area
or nationally (depending upon where the deposits are solicited), unless it is well-capitalized or is adequately capitalized and
receives a waiver from the FDIC. A depository institution that is adequately capitalized and accepts brokered deposits under a
waiver from the FDIC may not pay an interest rate on any deposit in excess of national and local rate caps set by the FDIC and
published on its website.
Transactions with Affiliates; Insider Loans. Under current federal law, all transactions between and among a bank and its
affiliates, including holding companies, are subject to Sections 23A and 23B of the Federal Reserve Act and Regulation W
promulgated thereunder. Generally, these requirements limit extensions of credit and certain other such transactions by the bank
to affiliates to a percentage of the institution's capital and generally such transactions must be collateralized. Generally, all
affiliate transactions must be on terms at least as favorable to the bank as transactions with non-affiliates. In addition, a bank
may not lend to any affiliate engaged in non-banking activities that are not permissible for a bank holding company or acquire
shares of any affiliate that is not a subsidiary. Federal law authorizes the imposition of additional restrictions on transactions
with affiliates if necessary to protect the safety and soundness of a bank.
Extensions of credit by a bank to executive officers, directors and principal shareholders are subject to Section 22(h) of
the Federal Reserve Act, which, among other things, generally prohibits loans to any such individual where the aggregate
amount exceeds an amount equal to 15% of an institution's unimpaired capital and surplus plus an additional 10% of
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unimpaired capital and surplus in the case of loans that are fully secured by readily marketable collateral. Section 22(h) permits
loans to directors, executive officers and principal shareholders made pursuant to a benefit or compensation program that is
widely available to employees of a subject bank provided that no preference is given to any officer, director or principal
shareholder, or related interest thereto, over any other employee. In addition, the aggregate amount of extensions of credit by a
bank to all insiders cannot exceed the institution's unimpaired capital and surplus. Furthermore, Section 22(g) places additional
restrictions on loans to executive officers.
The affiliate transaction rules in Sections 23A and 23B of the Federal Reserve Act broaden the definition of affiliate and