Flagstar Bank, N.a. · NYSE:FLG
Flagstar Bank, N.a — Q2 2025 Earnings Presentation
25 slides from Flagstar Bank, N.a's earnings presentation, Jul 25, 2025
Slide 1: Second Quarter 2025 Results
Second Quarter 2025 Results July 25, 2025
Slide 2: Cautionary Statement
Cautionary Statement Forward-Looking Information This presentation and the associated conference call may include forward‐looking statements by the Company and our authorized officers pertaining to such matters as our goals, beliefs, intentions, and expectations regarding, among other things: (a) re
Slide 3: Flagstar Intends to Eliminate Bank Holding Company
Flagstar Intends to Eliminate Bank Holding Company Current Structure Benefits ◼ Continuation of simplification efforts further driving efficiencies Flagstar Financial, Inc. o Streamline managerial, operational, and (Bank Holding Company) administrative functions throughout the Bank o Simplify organi
Slide 4: Momentum Continued During Second Quarter 2025
Momentum Continued During Second Quarter 2025 Management Focus Areas in 2025 1 2 3 4 Improve Execute on C&I Proactive Credit Earnings and Private Bank Management Improvement Profile Growth Initiatives of CRE Portfolio ▪ NIM expansion; ▪ Grow primary bank ▪ Continue reduction ▪ Lower provision for re
Slide 5: Commercial Banking Overview
Commercial Banking Overview Commercial Loans & Deposits Two-pronged Strategy ◼ 2Q’25 new credit commitments up 80% to $1.9 billion ◼ Specialized Industries - national model focused on serving the ◼ 2Q’25 new loan originations up 57% to $1.2 billion unique needs of specific industries, with fast deci
Slide 6: Commercial Banking Overview | Momentum in Focus Areas
Commercial Banking Overview | Momentum in Focus Areas New and Increased C&I Loan Originations New and Increased C&I Loan Commitments $ in millions $ in millions Strategic focus areas up Strategic focus areas up $362 million, or 81% QoQ $674 million, or 104% QoQ $1,887 Corporate & $243 Regional Comme
Slide 7: Commercial Banking Overview | Momentum in Focus Areas
Commercial Banking Overview | Momentum in Focus Areas C&I Loans HFI at 6/30/2025 Specialized Industries $ in millions New Loan Originations Change Change Change Change 6/30/25 New Credit Commitments ($ in millions) QoQ ($) QoQ (%) YTD ($) YTD (%) Specialized $1,076 Industries & $4,034 $422 11.7% $57
Slide 8: Strengthened Balance Sheet
Strengthened Balance Sheet Key Balance Sheet Metrics Improved Since Beginning of 2024 Common Equity Allowance for Credit Cash & Securities Wholesale Borrowings Tier 1 Ratio Losses to LHFI to Total Assets to Total Assets Target operating range 10.5-11.5% 24.9% 12.3% 1.81% 17.7% 17.4% 9.1% 1.23% 13.2%
Slide 9: Quarterly Performance
Quarterly Performance QUARTERLY PERFORMANCE Reported Notable Adjusted 2Q 2025 Items 2Q 2025 Net interest income $419 $- $419 Non-interest income 77 - 77 Total revenue $496 $- $496 Total non-interest expense 513 (25) 488 Pre-provision net (loss) revenue $(17) $25 $9 Provision for credit losses 64 - 6
Slide 10: Forecast Update
Forecast Update ($ in millions, except per 2025 2026 2027 2025 2026 2027 share data) $1,700 – $2,250 – $2,900 – Diluted Adjusted ($0.40 - Net Interest Income $0.75 – $0.80 $2.10 –$2.20 $1,750 $2,300 $3,000 EPS(1) $0.35) Net Interest Margin 1.85 – 1.95% 2.40 – 2.60% 2.80 – 2.90% Efficiency Ratio(2) 8
Slide 11: Net Interest Margin | Proactively Managing Higher
Net Interest Margin | Proactively Managing Higher Net Interest Margin 5.50% 5.00% Fed Funds Rate 4.50% 4.50% 4.50% Interest-Bearing Deposit Costs 4.37% 4.15% 4.19% 3.85% 3.74% 2.80% - 2.40% - 2.90% 1.85% - 2.60% 1.98% 1.95% 1.79% 1.73% 1.74% 1.81% Reflects NIM Guidance Range 6/30/24 9/30/24 12/31/24
Slide 12: Noninterest Expense | Disciplined Management
Noninterest Expense | Disciplined Management Adjusted Operating Expenses(1) Highlights $ in millions ◼ Linked Year: adjusted operating expenses decreased $178 million, or 28% $656 ◼ Linked Quarter: adjusted operating expenses decreased $25 $638 million, or 5% $556 $485 $460 ◼ Reduction in operating
Slide 13: Capital | Strong Capital Position
Capital | Strong Capital Position CET1 Ratio 12.3% 11.8% 11.9% Target operating 10.8% range 10.5-11.5% 9.5% 6/30/24 9/30/24 12/31/24 3/31/25 6/30/25 Highlights 1. CET1 ratio of 12.3% is top quartile in peer group 2. Significant management action preserved and strengthened capital position 3. Capital
Slide 14: Deposits | Overview
Deposits | Overview Well Diversified Deposit Base by Product Deposit Activity $ in billions Balance ($B) 6/30/25 Noninterest-Bearing Demand $12.5 $73.9 $69.7 Interest-Bearing Demand $12.1 $(2.2) $(2.0) Money Markets $6.4 Savings $14.5 Retail CDs $18.1 Jumbo CDs $6.1 3/31/25 Brokered Mortgage 6/30/25
Slide 15: Commercial Real Estate | Payoffs and CRE Concentration Trends
Commercial Real Estate | Payoffs and CRE Concentration Trends CRE Portfolio Payoffs at Par Total Total 1Q’25 2Q’25 Substandard Substandard Record CRE Payoffs Payoffs (%) (%) payoffs at par of Multi-Family $673 million 62% $1.2 billion 52% $1.5B with 45% of the payoffs Office $14 million --% $44 mill
Slide 16: Multi-Family | Portfolio Overview
Multi-Family | Portfolio Overview Proactively Reducing Multi-Family (MF) Exposure(1) Highlights $ in billions ◼ Multi-Family portfolio ALLL at 1.68%, among the highest relative to peers(2) | MF ALLL reflects the mix of the company’s loans including the rent-regulated loans -12% $33.9 ◼ MF rent regul
Slide 17: Multi-Family | New York City (NYC) Portfolio Details
Multi-Family | New York City (NYC) Portfolio Details NYC Multi-Family Portfolio (as of 6/30/2025) $ in millions Portfolio Characteristics Loan Review Credit Metrics Book Average Occ Current (1) Amort(2) Recent (3) Financials (4) ACL % to Recent Nonaccrual Balance Balance Rate LTV DSCR Appraisal Revi
Slide 18: Asset Quality | Allowance for Credit Loss Detail
Asset Quality | Allowance for Credit Loss Detail 3/31/2025 6/30/2025 Change in ($ in millions) Allowance ALLL % Allowance ALLL % ALLL % Multi-Family $609 1.82% $538 1.68% (14) bps Multi-Family Rent Regulated >=50% (excl. Co-op) $361 2.82% $347 2.88% 6 bps Multi-Family at Market and Rent Regulated <5
Slide 19: Asset Quality
Asset Quality Criticized + Classified Loans(1) Total Non-accrual Loans (including LHFS) $ in billions $ in billions $3.3 $3.2 $14.3 $14.9 $14.0 $12.7 $11.8 -4% -15% 6/30/24 9/30/24 12/31/24 3/31/25 6/30/25 3/31/25 6/30/25 Net Charge-offs to Average Loans(2) Highlights ◼ Criticized + classified loans
Slide 20: Investment Profile
Investment Profile Closing Valuation Gap to Peer Group Presents Significant Upside $28.23 $17.64 Share Price $12.05 Share Reflecting Price Multiple Reflecting of 1.6x Current Multiple TBV/sh Share of 1.0x Price TBV/sh 7/24/2025 12/31/2027 12/31/2027 Adjusted Adjusted for Warrants for Warrants Note:
Slide 21: Appendix
Appendix
Slide 22: Capital and Liquidity Position
Capital and Liquidity Position $50 – 100B Asset Flagstar Flagstar Flagstar Category IV Banks Banks Q2’24 Q1’25 Q2’25 Most Recent Available Most Recent Available CET1 Ratio 9.5% 11.9%(1) 12.3%(1) 10.7% 11.0% CET1 Ratio 9.4% 11.0%(1)(2) 11.4%(1)(2) 8.5% 9.9% (inclusive of AOCI)(1)(2) Loan to Deposit R
Slide 23: Q2 2025 Financial Highlights
Q2 2025 Financial Highlights Flagstar Income Statement Commentary ($ in millions) 6/30/25 Net Interest Income $419 Net Interest Income and Non-interest Income: INCOME STATEMENT SUMMARY Noninterest Income $77 Reflects consistent fee income, along with growth in spread income driven by higher earning
Slide 24: Reconciliations of GAAP and Non-GAAP Measures
Reconciliations of GAAP and Non-GAAP Measures Adjusted Noninterest Expense Three Months Three Months Three Months Three Months Three Months Ended Ended Ended Ended Ended 6/30/2024 9/30/2024 12/31/2024 3/31/2025 6/30/2025 Noninterest expense $705 $716 $718 $532 $513 Less: Intangible asset amortizatio
Slide 25: Peer Groups
Peer Groups Category IV Banks Ticker Banks with $50B - $100B in Assets Ticker Citizens Financial CFG Columbia Banking System COLB Fifth Third Bancorp FITB Comerica CMA First Citizens Banc. FCNC.A Cullen Frost Bankers CFR Huntington Banc. HBAN East West Bancorp EWBC KeyCorp KEY First Horizon FHN M&T