WEST READING, PA — Customers Bancorp, Inc. (NYSE: CUBI) reported solid second-quarter earnings, highlighting continued momentum in loan growth, improved profitability, and enhanced capital strength. The bank delivered net income of $55.8 million, or $1.73 per diluted share, while core earnings reached $58.1 million, or $1.80 per diluted share.
Return on average assets (ROAA) stood at 1.09%, with return on common equity (ROCE) at 12.79%. On a core basis, ROAA was 1.10% and core ROCE reached 13.32%.
Chairman and CEO Jay Sidhu emphasized the bank’s resilience and growth trajectory. “We are pleased to share our second quarter results that highlight the company’s continued execution of its strategic priorities,” Sidhu said. “We believe the company is extremely well-positioned to continue to strengthen our deposit franchise, improve our profitability, and maintain our already strong capital ratios.”
Loan and Deposit Trends
Loans and leases held for investment grew by $319.0 million during the quarter, a 2.1% increase over Q1, driven by $360.7 million in commercial loan expansion within the bank’s specialized lending verticals. The company reported limited exposure—just 1% of its portfolio—to higher-risk office real estate.
Total deposits rose modestly by $43.1 million, or 0.2%, with a notable boost from teams recruited since early 2023. These deposit-focused teams now manage $2.4 billion, or 13% of total deposits. Since the end of 2022, Customers has increased commercial deposit accounts by roughly 60%, helping drive down deposit costs and increase non-interest-bearing balances.
Margin Expansion and Capital Strength
Net interest margin (NIM) expanded by 14 basis points to 3.27%, up from 3.13% in the prior quarter, fueled by higher-yielding loan originations and prudent expense control.
The bank’s Common Equity Tier 1 (CET1) capital ratio improved to 12.0%, while its tangible common equity to total assets (TCE/TA) ratio rose to 7.9%, up 20 basis points. Tangible book value per share climbed to $56.24, up 2.7% from the prior quarter—or 11% on an annualized basis.
Customers also redeemed all $57.5 million in Series E Preferred Stock on June 16, further simplifying its capital structure.
Credit and Liquidity
Provision for credit losses dropped to $20.8 million from $28.3 million in Q1. The bank’s allowance for credit losses now covers non-performing loans at a ratio of 518%, up from 324% at the end of the first quarter. The non-performing asset ratio remained low at 0.27% of total assets.
Liquidity remains ample, with $8.6 billion in immediately available funds—equivalent to approximately 150% of uninsured deposits. The bank’s loan-to-deposit ratio stood at a conservative 81%.
Looking Ahead
Sidhu signaled confidence in the company’s forward strategy. “This year three new teams have joined the Bank and the recruitment pipeline remains strong,” he said. “We believe that our unique strategy, the investments we have continued to make, and the exceptional talent across our organization position us strongly for continued success in 2025 and beyond.”
With continued focus on high-quality commercial lending, deposit franchise expansion, and disciplined balance sheet management, Customers Bancorp appears set to maintain its upward trajectory through the remainder of the year.
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