Capitol Federal Financial Q2 Net Income Dips to $20.1M

By Chris Stiles • Wednesday, April 29 12:18 • Permanent Link

Capitol Federal Financial reported second-quarter fiscal 2026 net income of $20.1 million, down from $20.3 million in the prior quarter, while earnings per share held at $0.16.

Net interest income rose to $52.3 million from $51.4 million, an increase of $949,000, marking the company’s seventh straight quarter of growth in that line. Net interest margin widened to 2.24% from 2.19%, a gain of 5 basis points, driven primarily by lower borrowings.

Interest expense fell to $52.3 million from $54.7 million. Deposit interest expense declined to $36.3 million from $37.5 million, and borrowing expense dropped to $16.0 million from $17.2 million.

On the revenue side, interest and dividend income slipped to $104.6 million from $106.0 million. Loan interest income decreased to $89.3 million from $89.8 million, mortgage-backed securities income fell to $10.9 million from $11.3 million, and cash and cash equivalents income declined to $2.5 million from $2.8 million.

The company recorded a provision for credit losses of $2.4 million, up from $1.1 million in the prior quarter.

Noninterest expense was lower, helping support profit. The efficiency ratio improved to 52.45% from 53.66%, while the operating expense ratio was unchanged at 1.24%.

At quarter-end, total assets were $9.83 billion and stockholders’ equity was $1.03 billion. Tangible book value per share was $7.96.

Commercial lending continued to expand. Commercial loans increased by $39.1 million during the quarter to $2.32 billion, and commercial deposits rose by $20.4 million to $548.1 million. Since September 30, 2025, commercial loans were up $201.8 million, or 19.1% annualized, and commercial deposits were up $39.9 million, or 15.7% annualized.

Capital returned to shareholders remained substantial. The company paid $15.9 million in dividends during the quarter, including a $0.040 special dividend, and repurchased 2,155,481 shares at an average price of $7.16. Through the first six months of fiscal 2026, it paid $26.9 million in dividends and repurchased 4,532,114 shares for $31.7 million. Through April 22, it had bought back another 927,964 shares for $7.0 million. Today the company's shares have moved -0.77% to a price of $7.69. For the full picture, make sure to review Capitol Federal Financial's 8-K report.

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