Provident Financial Services Inc.: Q3 FY2025 earnings call

What management said about Q3 FY2025, from the documents filed with the SEC on 30 October 2025: press release. The quarter’s numbers.

Read the filing

Key takeaways

• Record revenue for second straight quarter: Total revenue was $221.8 million, made up of record net interest income of $194.3 million and non-interest income of $27.4 million, against $214.2 million in the prior quarter. Source
• Net interest income rose $7.2 million: Net interest income rose to $194.3 million from $187.1 million. Management attributed the increase to new loans and securities originated at current market rates, partly offset by lower-costing average deposits. Source
• Deposits rose $387.7 million: Total deposits rose 8.22% annualized to $19.10 billion. Core deposits, which exclude certificates of deposit, rose $290.8 million to $15.73 billion. Source
• Efficiency ratio improved to 51.01%: The adjusted efficiency ratio improved to 51.01% from 53.52%. Adjusted non-interest expense as a percentage of average assets improved to 1.83% from 1.89%. Source
• Provision of $7.0 million: The provision was $4.5 million on loans and $2.5 million on commitments. The prior quarter had a $2.9 million benefit to the provision. Source
• Net charge-offs rose to $5.4 million: Net charge-offs were $5.4 million, or 11 basis points of average loans, against $1.2 million in the prior quarter. Management said the charge-offs related to resolving non-accrual loans largely reserved for earlier. Source
• Tangible book value per share rose: Tangible book value per share rose 3.6% to $15.13, and the tangible common equity ratio rose 19 basis points to 8.22%. Book value per share was $21.18 at September 30, 2025. Source

“Provident continued to make progress on several strategic initiatives and delivered another impressive performance this quarter.”

Anthony J. Labozzetta, President and Chief Executive Officer

Earnings and returns

• Net income flat on prior quarter: Net income was $71.7 million, or $0.55 per diluted share, against $72.0 million, or $0.55, in the prior quarter. Nine-month net income was $207.7 million, or $1.59 per diluted share. Source
• Record revenue for second straight quarter: Total revenue was $221.8 million, made up of record net interest income of $194.3 million and non-interest income of $27.4 million, against $214.2 million in the prior quarter. Source
• Pre-tax, pre-provision returns rose: Annualized adjusted pre-tax, pre-provision return on average assets was 1.76%, up from 1.64%. Return on average equity on that basis was 15.74%, up from 14.88%, and return on average tangible equity was 22.20%, up from 21.26%. Source
• Reported returns on equity and assets: Annualized return on average assets was 1.16%, return on average equity 10.39% and return on average tangible equity 16.01%, compared with 1.19%, 10.76% and 16.79% in the prior quarter. Source

Net interest income and yields

• Net interest income rose $7.2 million: Net interest income rose to $194.3 million from $187.1 million. Management attributed the increase to new loans and securities originated at current market rates, partly offset by lower-costing average deposits. Source
• Asset yields and funding costs rose: The weighted average yield on interest-earning assets rose eight basis points to 5.76%. The weighted average cost of interest-bearing liabilities rose two basis points to 2.96%. Source
• Borrowing costs edged higher: The average cost of borrowed funds was 3.96%, against 3.94% in the prior quarter. The average cost of total deposits, including non-interest-bearing deposits, was 2.14%, against 2.10%. Source

“We again achieved record revenues and pre-tax, pre-provision earnings by responsibly growing earning assets and deposits, while further improving operational efficiency and maintaining strong asset quality.”

Anthony J. Labozzetta, President and Chief Executive Officer

Loans, deposits and pipeline

• Commercial loans grew $149.0 million: Commercial and industrial loans, excluding mortgage warehouse lines, rose 12.61% annualized to $4.84 billion, from $4.69 billion at June 30, 2025. Source
• Deposits rose $387.7 million: Total deposits rose 8.22% annualized to $19.10 billion. Core deposits, which exclude certificates of deposit, rose $290.8 million to $15.73 billion. Source
• Loan pipeline rose to $2.87 billion: The pipeline of work-in-process and approved loans pending closing was $2.87 billion, up from $2.59 billion, with a weighted average rate of 6.15% against 6.30% in the prior quarter. Source
• Total commercial loans grew: Total commercial loans, including mortgage warehouse lines, commercial mortgage, multi-family and construction loans, rose $191.2 million, or 4.59% annualized, to $16.70 billion. Source

Fee and insurance income

• Non-interest income edged up: Non-interest income was $27.4 million, up $344,000. Fee income rose $600,000 to $11.3 million on higher loan prepayment fees, partly offset by lower ATM fees. Source
• Wealth management income rose $401,000: Wealth management income rose to $7.3 million, mainly because the average market value of assets under management increased during the period. Source
• Insurance income fell on seasonality: Insurance agency income fell $1.1 million to $3.9 million, which management attributed to normal seasonality of business activity in the quarter. Source

Expenses and efficiency

• Non-interest expense fell $1.5 million: Non-interest expense was $113.1 million, down from $114.6 million. Other operating expenses fell $1.0 million, data processing fell $497,000 and occupancy fell $238,000, while advertising rose $211,000. Source
• Efficiency ratio improved to 51.01%: The adjusted efficiency ratio improved to 51.01% from 53.52%. Adjusted non-interest expense as a percentage of average assets improved to 1.83% from 1.89%. Source
• Tax expense and effective rate: Income tax expense was $29.9 million, with an effective tax rate of 29.4%, against $30.5 million and 29.7% in the prior quarter. Source

Credit quality and provision

• Provision of $7.0 million: The provision was $4.5 million on loans and $2.5 million on commitments. The prior quarter had a $2.9 million benefit to the provision. Source
• Net charge-offs rose to $5.4 million: Net charge-offs were $5.4 million, or 11 basis points of average loans, against $1.2 million in the prior quarter. Management said the charge-offs related to resolving non-accrual loans largely reserved for earlier. Source
• Non-accrual loans fell $6.8 million: Non-accrual loans were $100.4 million, or 0.52% of total loans. Non-performing assets were 0.41% of total assets. Source
• Allowance coverage of loans: The allowance for credit losses was 0.97% of loans, down from 0.98%. Allowance coverage of non-performing loans rose to 186.21% from 175.32%. Source
• New York multifamily exposure small: Multi-family loans secured by New York City properties totaled $286.7 million. Management said loans collateralized by rent stabilized apartments were under 1.00% of total loans and all performing. Source

Capital and shareholder returns

• Tangible book value per share rose: Tangible book value per share rose 3.6% to $15.13, and the tangible common equity ratio rose 19 basis points to 8.22%. Book value per share was $21.18 at September 30, 2025. Source
• Equity rose on earnings: Stockholders' equity rose $165.8 million in the nine months to $2.77 billion, mainly from net income, partly offset by dividends paid. Source
• Buybacks tied to tax withholding: Repurchases were 1,335 shares in the quarter and 157,905 shares in the nine months, all made to cover income taxes on vesting of stock-based compensation. About 814,634 shares remained eligible for repurchase. Source

Balance sheet and securities

• Securities portfolio grew $344.3 million: Total investment securities were $3.57 billion, up from December 31, 2024, primarily from purchases of mortgage-backed securities. Total assets were $24.83 billion. Source
• Borrowed funds share of assets rose: Borrowed funds were 8.9% of total assets, up from 8.4% at December 31, 2024, and totaled $2.21 billion. Source
• Unfunded loan commitments total: Unfunded loan commitments totaled $3.82 billion, including $2.20 billion in commercial loans, $572.9 million in construction loans and $312.0 million in commercial mortgage loans. Source

Figures management reported

Risks management discussed

• Financial: Net charge-offs rose on resolution of non-accrual loans that had been largely reserved for in earlier periods. Source
• External: Management attributed part of the provision to a modestly weakened economic forecast under the CECL model compared with the prior quarter. Source
• Financial: Mortgage warehouse lines of credit, which are exposure to non-depository financial institutions, totaled $292.1 million. Source

Earlier plans management reported on

• Not stated: Management said it continued to invest in talent and technology. The release gives no status measure for this investment. Source

Other quarters

• Q2 FY2026 earnings call
• Q1 FY2026 earnings call
• Q4 FY2025 earnings call
• Q2 FY2025 results

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.