Customers Bancorp Reports Results for Fourth Quarter and Full Year 2025

Customers Bancorp, Inc. (NYSE:CUBI):

Fourth Quarter 2025 Highlights

• Q4 2025 net income available to common shareholders was $70.1 million, or $1.98 per diluted share; ROAA was 1.20% and ROCE was 13.28%.
• Q4 2025 core earnings*¹ were $72.9 million, or $2.06 per diluted share; Core ROAA* was 1.19% and Core ROCE* was 13.81%.
• Total deposits increased $373.7 million, or 1.8%, and total loans increased $479.4 million, or 2.9%, in Q4 2025 from Q3 2025.
• Net interest income totaled $204.4 million in Q4 2025, an increase of $2.5 million from Q3 2025 primarily driven by a decrease in interest expense.
• Completed $100 million subordinated debt issuance on December 22, 2025.
• Redeemed all outstanding shares ($85 million) of Series F Preferred Stock on December 15, 2025.

Full Year 2025 Highlights

• 2025 net income available to common shareholders was $209.2 million, or $6.26 per diluted share; ROAA was 0.96% and ROCE was 11.22%.
• 2025 core earnings* were $254.5 million, or $7.61 per diluted share; Core ROAA* was 1.13% and Core ROCE* was 13.65%.
• Total deposits increased $1.9 billion, or 10.3%, and total loans increased $2.1 billion, or 14.5%, from December 31, 2024 to December 31, 2025.
• Net interest income totaled a record $750.5 million in 2025, an increase of $96.1 million, or 14.7%, from 2024.
• CET 1 capital ratio of 13.0%² at December 31, 2025, compared to 12.1% at December 31, 2024.
• Book value per share and tangible book value per share* grew year over year by approximately $7.69 or 14.2%, driven by strong 2025 annual earnings combined with the completed common stock offering and decreased AOCI losses of $42.5 million during the year.
• $278.8 million increase in total shareholders equity, or 15.2%, driven by completed common stock offering and strong organic earnings.

CEO Commentary

"We are pleased with our fourth quarter and full year results that show the company's continued execution of its strategic priorities and underscore our success in growing franchise value," said Customers Bancorp Executive Chairman Jay Sidhu.

"During the quarter, we continued to strategically grow our loan and deposit portfolios as we saw momentum throughout the organization. Total loans and leases grew by 14.5% in 2025 with contributions from multiple verticals allowing us to deliver above industry average growth rates without sacrificing on structure or credit quality.

Our new teams recruited since Q2 2023 continued to shine, adding nearly $600 million of deposits in Q4 2025. These 18 teams now manage over $3.3 billion in deposits across over 8,000 commercial accounts. This has allowed us to deliver over $500 million of non-interest bearing deposit growth in 2025 outside of the benefits of our cubiX platform clients.

Our Q4 2025 GAAP earnings were $70.1 million, or $1.98 per diluted share, and core earnings* were $72.9 million, or $2.06 per diluted share. Asset quality remains strong with our NPA ratio at just 0.29% of total assets and reserve levels are robust at 356% of total non-performing loans at the end of Q4 2025. Our TCE / TA ratio* increased by 10 basis points from September 30, 2025 to 8.5% at December 31, 2025, while our balance sheet grew by 2.6%.

In 2025, we once again delivered exceptionally strong growth in revenue, core earnings, and tangible book value per share of 14.5%, 35.9%*, and 14.2%*, respectively.

We believe that our unique strategy, the investments we are making, and the exceptional talent across our organization position us strongly for continued success. It is because of this positioning that I felt confident in completing the previously announced leadership transition and succession plan with Sam Sidhu becoming Chief Executive Officer of Customers Bancorp, effective January 1, 2026," Jay Sidhu concluded.

Key Balance Sheet Trends

Loans and Leases Held for Investment

Loans and leases held for investment were $16.8 billion at December 31, 2025, up $484 million, or 3.0%, from September 30, 2025. Non-owner occupied commercial real estate loans increased by $156 million, or 9.9% quarter-over-quarter to $1.7 billion. Multifamily loans increased by $134 million, or 5.7% to $2.5 billion. Mortgage finance loans increased by $123 million, or 7.8% to $1.7 billion. Owner-occupied commercial real estate loans increased by $76 million, or 7.2% to $1.1 billion.

Loans and leases held for investment of $16.8 billion at December 31, 2025 were up $2.3 billion, or 16.0%, year-over-year. Specialized lending increased by $1.2 billion, or 21.4%, year-over-year. Non-owner occupied commercial real estate loans increased by $380 million, or 27.9%. Mortgage finance loans increased by $260 million, or 18.0%. Multifamily loans increased by $238 million, or 10.6%. Consumer installment loans increased by $166 million, or 23.3%, inclusive of the transfer from loans held for sale in Q1 2025.

Investment Securities

At December 31, 2025, total investment securities were $2.7 billion, a decrease of $145 million compared to September 30, 2025 and a decrease of $345 million compared to a year ago.

At December 31, 2025, the Available-For-Sale ("AFS") debt securities portfolio had a spot yield of 5.54%, an effective duration of approximately 2.4 years, and approximately 29% are variable rate. Additionally, 69% of the AFS securities portfolio was AAA rated at December 31, 2025.

At December 31, 2025, the Held-To-Maturity ("HTM") debt securities portfolio represented only 2.9% of total assets, had a spot yield of 3.31% and an effective duration of approximately 3.9 years. Additionally, at December 31, 2025, approximately 62% of the HTM securities were AAA rated and $0.3 billion were credit enhanced asset backed securities with no current expectation of credit losses.

Deposits

Total deposits increased $374 million to $20.8 billion at December 31, 2025 as compared to the prior quarter. The total average cost of deposits decreased by 23 basis points to 2.54% in Q4 2025 from 2.77% in the prior quarter. Total estimated uninsured deposits were $6.6 billion¹, or 32% of total deposits at December 31, 2025 with immediately available liquidity covering approximately 161% of these deposits.

Total deposits increased $1.9 billion to $20.8 billion at December 31, 2025 as compared to a year ago. The total average cost of deposits decreased by 53 basis points to 2.54% in Q4 2025 from 3.07% in Q4 2024.

Borrowings

Total borrowings increased $228.1 million, or 15.4% to $1.7 billion at December 31, 2025 as compared to the prior quarter. Total borrowings increased $295 million, or 21.0%, to $1.7 billion at December 31, 2025 as compared to a year ago. This increase primarily resulted from net draws of $130 million in FHLB advances and the issuance of $100 million in Customers Bancorp subordinated notes in Q4 2025.

Capital

Customers Bancorp's common equity increased $72 million to $2.1 billion, and tangible common equity* increased $72 million to $2.1 billion, at December 31, 2025 compared to the prior quarter, respectively, primarily from earnings of $70 million. Customers Bancorp's common equity increased $417 million to $2.1 billion, and tangible common equity* increased $417 million to $2.1 billion, at December 31, 2025 compared to a year ago, respectively, primarily from earnings of $209 million, the issuance of $163 million of common stock on September 5, 2025 and a decrease in AOCI of $43 million (net of taxes), mostly from decreased unrealized losses on investment securities, offset in part by $6 million of common share repurchases. Book value per common share increased to $61.87 from $59.83 and $54.20, and tangible book value per common share* increased to $61.77 from $59.72 and $54.08, at December 31, 2025 from September 30, 2025 and December 31, 2024, respectively.

Credit Quality

The provision for credit losses in Q4 2025 was $22 million, compared to $27 million in Q3 2025 and $21 million in Q4 2024.

Net charge-offs were $14 million in Q4 2025, compared to $15 million in Q3 2025 and Q4 2024.

The allowance for credit losses on loans and leases was $156 million at December 31, 2025, compared to $152 million at September 30, 2025 and $137 million at December 31, 2024.

Non-performing loans at December 31, 2025 increased to 0.26% of total loans and leases, compared to 0.17% at September 30, 2025 and decreased, compared to 0.30% at December 31, 2024. Nonperforming loans include the guaranteed portion of SBA loans. As of December 31, 2025, nonperforming loans totaled $44 million, of which $10 million represents the government-guaranteed portion. Excluding the government-guaranteed portion, nonperforming loans totaled $34 million, representing 0.20% of total loans and leases.

Key Profitability Trends

Net Interest Income

Net interest income totaled $204.4 million in Q4 2025, an increase of $2.5 million from Q3 2025. This increase was driven by a decrease in interest expense primarily due to a favorable shift in deposit mix and lower market interest rates.

"Net interest income continued to increase in the quarter despite a decline in market interest rates as we realized the benefits of loan growth, growth in average non-interest bearing and lower-cost deposits, and well managed funding costs," stated Customers Bancorp CEO Sam Sidhu. "Our full year net interest income reached a record level in 2025. We continue to have positive drivers to net interest income on both sides of the balance sheet. We have a strong loan pipeline and the flywheel from our primarily deposit-focused commercial banking team recruitment strategy continued to gain momentum and our recruitment pipeline remains strong," stated Sam Sidhu.

Net interest income totaled $204.4 million in Q4 2025, an increase of $36.6 million from Q4 2024. This increase was primarily due to higher interest income primarily due to higher average loan balances and higher discount accretion in C&I loans and lower interest expense from a favorable shift in deposit mix and lower market interest rates.

Non-Interest Income

Reported non-interest income totaled $32.5 million for Q4 2025, an increase of $2.3 million compared to $30.2 million for Q3 2025. The increase was primarily due to increases of $2.7 million in commercial lease income and other non-interest income of $3.9 million primarily from an increase of $2.0 million in gain on sale of leased assets and gains on certain derivatives. These increases were partially offset by a decrease of $4.0 million in loan fees mostly associated with the settlement of stock warrants in Q3 2025.

Non-interest income totaled $32.5 million for Q4 2025, an increase of $32.9 million compared to Q4 2024. The increase was primarily due to a decrease in net loss on sale of investment securities of $26.2 million and increases in commercial lease income of $3.6 million and gain on sale of leased assets of $2.6 million included in other non-interest income, partially offset by a decrease of $1.2 million in loan fees.

Non-Interest Expense

Non-interest expenses totaled $117.3 million in Q4 2025, an increase of $12.1 million compared to Q3 2025. The increase was primarily attributable to increases of $3.0 million in salaries and employee benefits primarily due to higher headcount and incentives and $2.2 million in commercial lease depreciation associated with the Bank's continued growth, and within other non-interest expense of $2.8 million in provision for credit losses on unfunded lending commitments and $2.2 million in insurance expenses related to investments in tax credit structures with a corresponding benefit to income tax expense.

"We had a total of $4.8 million of expense that was unique to the quarter including $1.9 million of legal expense associated with a new team onboarding, $2.2 milliion of insurance expense on tax credit purchases with corresponding benefit to income tax expense, and $0.7 million of stock compensation and benefit expense. Additionally we had $2.2 million of higher commercial lease depreciation driven by higher volume which came with corresponding revenues. Even with these costs and investments we continue to make in our future our efficiency ratio remained very strong," stated Customers Bancorp CFO Mark McCollom.

Non-interest expenses totaled $117.3 million in Q4 2025, an increase of $6.9 million compared to Q4 2024. The increase was primarily attributable to increases of $4.6 million in salaries and employee benefits and $2.7 million in commercial lease depreciation associated with the Bank's continued growth, and within other non-interest expense of $2.7 million in provision for credit losses on unfunded lending commitments and $2.2 million in insurance expenses related to investments in tax credit structures with a corresponding benefit to income tax expense. These increases were partially offset by decreases of $2.0 million in technology, communication and bank operations primarily due to lower deposit servicing fees, fees paid to a fintech company related to a consumer installment loan origination program included within other non-interest expense, professional fees and FDIC assessments, non-income taxes and regulatory fees.

Taxes

Income tax expense decreased by $1.8 million to a provision of $22.8 million in Q4 2025 from $24.6 million in Q3 2025 primarily due to lower pre-tax income, and increased by $13.9 million from $8.9 million in Q4 2024 primarily due to higher pre-tax income, partially offset by a lower increase of unrecognized benefits in Q4 2025 as compared to Q4 2024. The effective tax rate was 23.4% for Q4 2025.

Outlook

"We were very pleased with our fourth quarter and full year results and remain focused on executing in those areas which differentiate us from our peers. We believe that truly exceptional service, sophisticated product offerings, recruitment of top talent, exceptional payment capabilities, and a single point of contact service model will deliver sustainable long-term growth.

As we look forward to 2026 our priorities will evolve but broadly remain unchanged. We will look to continue to deliver above industry average loan and deposit portfolio growth. We will build upon our successful team recruitment strategy, with newly recruited teams supporting our future growth. We will seek to deepen and broaden our payments capabilities building upon the incredible foundation our team has laid over the past two years. And we will target increasing our utilization of AI and automation technologies to transform our organization by providing enhanced client experiences and organizational productivity. We will seek to do this while maintaining a strong capital base, liquidity, and credit quality.

For 2026 we are targeting loan growth of 8% to 12% and deposit growth of 8% to 12%, resulting in net interest income growing to $800 to $830 million. We project non-interest expenses of $440 to $460 million as we continue to make investments in our future, largely in people and technology, but remain focused on driving positive operating leverage even with these investments. For capital, we are targeting CET1 of 11.5% to 12.5% and expect a tax rate of 23% to 25%.

We believe we are incredibly well positioned to continue to improve market share, winning new client relationships and that we have the right strategy, the right team, and a client-centric culture to achieve our goals in 2026 and beyond," concluded Sam Sidhu.

Webcast

The live audio webcast, presentation slides, and earnings press release will be made available at https://www.customersbank.com and at the Customers Bancorp 4th Quarter Earnings Webcast.

You may submit questions in advance of the live webcast by emailing our Head of Corporate Communications, Jordan Baucum at [email protected].

The webcast will be archived for viewing on the Customers Bank Investor Relations page and available beginning approximately two hours after the conclusion of the live event.

Institutional Background

Customers Bancorp, Inc. (NYSE:CUBI) is one of the nation's top-performing banking companies with over $24 billion in assets making it one of the 80 largest bank holding companies in the U.S. Customers Bank's commercial and consumer clients benefit from a full suite of technology-enabled tailored product experiences delivered by best-in-class customer service distinguished by a Single Point of Contact approach. In addition to traditional lines such as C&I, commercial real estate, and residential and personal lending, Customers Bank also provides a number of national corporate banking services to clients in businesses including: fund finance, venture banking, healthcare, mortgage finance, and equipment finance. Major accolades include:

• Named a Top 10 Performing Bank by American Banker for five consecutive years (2021-2025), including the #1 spot in 2024 among midsize banks ($10B to $50B in assets)
• No. 72 out of the 100 largest publicly traded banks in 2025 Forbes Best Banks list
• Net Promoter Score of 81 compared to industry average of 41

A member of the Federal Reserve System with deposits insured by the Federal Deposit Insurance Corporation, Customers Bank is an equal opportunity lender. Learn more: www.customersbank.com.

"Safe Harbor" Statement

In addition to historical information, this press release may contain "forward-looking statements" within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements with respect to Customers Bancorp, Inc.'s strategies, goals, beliefs, expectations, estimates, intentions, capital raising efforts, financial condition and results of operations, future performance and business. Statements preceded by, followed by, or that include the words "may," "could," "should," "pro forma," "looking forward," "would," "believe," "expect," "anticipate," "estimate," "intend," "plan," "project," or similar expressions generally indicate a forward-looking statement. These forward-looking statements involve risks and uncertainties that are subject to change based on various important factors (some of which, in whole or in part, are beyond Customers Bancorp, Inc.'s control). Numerous competitive, economic, regulatory, legal and technological events and factors, among others, could cause Customers Bancorp, Inc.'s financial performance to differ materially from the goals, plans, objectives, intentions and expectations expressed in such forward-looking statements, including: a continuation of the recent turmoil in the banking industry, responsive measures taken by us and regulatory authorities to mitigate and manage related risks, regulatory actions taken that address related issues and the costs and obligations associated therewith, such as the FDIC special assessments; the potential for negative consequences resulting from regulatory violations, investigations and examinations, including potential supervisory actions, the assessment of fines and penalties, the imposition of sanctions, the need to undertake remedial actions and possible damage to our reputation; effects of competition on deposit rates and growth, loan rates and growth and net interest margin; failure to identify and adequately and promptly address cybersecurity risks, including data breaches and cyberattacks; public health crises and pandemics and their effects on the economic and business environments in which we operate; geopolitical conditions, including acts or threats of terrorism, actions taken by the United States or other governments in response to acts or threats of terrorism and military conflicts, including the war between Russia and Ukraine and ongoing conflict in the Middle East or South America, which could impact economic conditions in the United States; the impact that changes in the economy have on the performance of our loan and lease portfolio, the market value of our investment securities, the demand for our products and services and the availability of sources of funding; the effects of actions by the federal government, including the Board of Governors of the Federal Reserve System and other government agencies, that affect market interest rates and the money supply; actions that we and our customers take in response to these developments and the effects such actions have on our operations, products, services and customer relationships; higher inflation and its impacts; the effects of changes in U.S. trade policies, including the imposition of tariffs and retaliatory tariffs on its trading partners; and the effects of any changes in accounting standards or policies. Customers Bancorp, Inc. cautions that the foregoing factors are not exclusive, and neither such factors nor any such forward-looking statement takes into account the impact of any future events. All forward-looking statements and information set forth herein are based on management's current beliefs and assumptions as of the date hereof and speak only as of the date they are made. For a more complete discussion of the assumptions, risks and uncertainties related to our business, you are encouraged to review Customers Bancorp, Inc.'s filings with the Securities and Exchange Commission, including its most recent annual report on Form 10-K for the year ended December 31, 2024, subsequently filed quarterly reports on Form 10-Q and current reports on Form 8-K, including any amendments thereto, that update or provide information in addition to the information included in the Form 10-K and Form 10-Q filings, if any. Customers Bancorp, Inc. does not undertake to update any forward-looking statement whether written or oral, that may be made from time to time by Customers Bancorp, Inc. or by or on behalf of Customers Bank, except as may be required under applicable law.