WSFS Financial Corporation the parent company of WSFS Bank, reported lowest net income in the first quarter, due to costs related to the acquisition of Beneficial Bank.
Earnings totaled $13 million compared to net income of $37.4 million the same period a year ago.
Net revenue was $124.4 million for the quarter, an increase of $19.3 million from the same period a year ago. Net interest income was $83.3 million, an increase of $25.6 million, or 44 percent from the same period a year earlier, and fee income (noninterest income) was $41.1 million, a decrease of $6.3 million from the same period a year earlier, primarily due to $11.5 million of higher unrealized valuation gains on an equity investment in Visa Class B shares in last year’s first quarter.
Rodger Levenson, WSFS CEO, stated: “During the quarter we successfully closed our combination with Beneficial and we remain on track to complete our branding and systems conversion during the third quarter of 2019.
“Our first quarter results were impacted by the closing of the Beneficial combination on March 1, 2019, including $31 million, or $0.65 per share, of anticipated restructuring and corporate development costs,” Levinson stated. “In addition, as a result of the changes in the overall market, performance of the Beneficial portfolio and interest rate environment since we announced the combination, the transaction metrics improved at closing, including an immediate tangible book value accretion of 1.15 percent.
The combination of the banks has been closely watched by investors. While Philadelphia-based Beneficial was comparable in size to WSFS, its financial performance has not been as strong. WSFS plans to shrink the number of branches of the combined banks and take other steps to reduce costs.
Also sold were a few branches at the edge of the market territory of the combined banks.
At the same time, WSFS will make a big investment in technology as customers move to mobile platforms, such as smartphones.
WSFS is headquartered in Wilmington but will retain a presence at the Beneficial home office in Philadelphia.
The company will be the largest Delaware Valley-based full-service bank.
