WSFS Efficiency Ratio Falls to 56.1% as Wealth Fees Rise

The Tip Desk · October 24, 2026 · 3 min read

Core EPS was $1.75, up 25% year over year, as Wealth and Trust fees rose 30% and the core efficiency ratio improved to 56.1%.

WSFS Financial Corporation (WSFS), the parent of the Philadelphia-region bank and wealth franchise, reported core earnings of $1.75 a share for the third quarter of 2026, up 25% from a year earlier, as Wealth and Trust fees continued to expand and the core efficiency ratio improved.

Net interest income rose $4.1 million, or 2% (not annualized), to $196.6 million, which the company said was driven by higher average loan balances and higher yields on loans and investment securities, partially offset by higher deposit costs. Net interest margin expanded 1bp to 3.88% from 3.87%. Total client deposit costs rose 4bps to 1.33% and interest-bearing deposit costs rose 5bps to 2.05%, which the company attributed to elevated deposit cost competition and mix shift.

Gross loans and leases grew 5% annualized quarter-over-quarter to $13.663 billion, a $162.6 million, or 1% (not annualized), increase, led by commercial & industrial and commercial small business leases, partially offset by runoff of the Spring EQ portfolio. Home Lending posted 6% growth across mortgages and home equity.

Total client deposits decreased $619.5 million, or 3% (not annualized), to $18.384 billion. The company said the reduction reflected expected outflow of transactional deposits at the end of the prior quarter in WSFS Institutional Services and Commercial, partially offset by growth in interest-bearing demand, money market, and time deposits. Average deposits increased slightly during the quarter. The loan-to-deposit ratio was 73%.

Core fee revenue of $91.0 million decreased $1.2 million, or 1%, from the second quarter. Wealth and Trust fees rose $2.5 million, or 5%, on growth across WSFS Institutional Services and Private Wealth Management. That increase was more than offset by a decline in Capital Markets revenue from lower demand for interest rate swaps and lower Cash Connect revenue from a decrease in cash volume. Year over year, Wealth and Trust fees increased 30%, including 45% growth in WSFS Institutional Services, 22% in BMT of DE, and 14% in Private Wealth Management.

Core noninterest expense of $161.5 million decreased $4.8 million, or 3% (not annualized), primarily due to lower external fraud losses including recoveries, lower medical costs, and lower professional fees from a recovery of legal expenses, partially offset by higher occupancy and an OREO write-down. The core efficiency ratio improved to 56.1% from 58.3%, a 223bps improvement.

Wealth and Trust pre-tax income increased $5.0 million, or 10% (not annualized), to $52.7 million, driven by $3.0 million higher net interest income and $2.3 million higher fee revenue. AUM/AUA increased $7.8 billion to $109.5 billion. Cash Connect pre-tax income was $2.9 million, down slightly, with net revenue down $0.5 million on lower cash volume and fewer units; net profit margin rose to 15.1%.

Net recoveries on loans and leases were $0.6 million, versus net charge-offs of $7.1 million in the second quarter, including $7.6 million of recoveries from NPA payoffs. Total net credit costs increased $4.4 million on an $8.1 million specific reserve on a student housing-related loan and a $2.0 million OREO write-down. Problem assets increased $57.5 million to $530.4 million, driven by downgrades primarily in multifamily and construction. NPAs increased $1.7 million to $82.7 million. The ACL on loans and leases increased $8.0 million to $185.2 million, with coverage up 4bps to 1.36%.

WSFS repurchased $59.6 million of common stock, or 1.5% of outstanding shares, and paid $10.2 million of dividends for $69.8 million of total capital return. Common Equity Tier 1 capital was 13.74%. The board approved a quarterly cash dividend of $0.20 a share, payable November 20, 2026. Chairman, CEO and President Rodger Levenson said the company looks forward to finishing the year out strong in the fourth quarter.