TFS Financial Corporation Declares Dividend

Rhea-AI Summary

TFS Financial Corporation (TFSL) declares a quarterly cash dividend of $0.2825 per share, payable on March 21, 2024, to stockholders of record on March 7, 2024. Third Federal Savings and Loan Association of Cleveland, MHC, waives its right to receive the dividend on its shares. Third Federal is a leading provider of savings and mortgage products, with assets totaling $17.05 billion as of December 31, 2023.

Insights

Financial Analyst

The declaration of a quarterly cash dividend by TFS Financial Corporation is a significant signal to investors about the company's profitability and financial health. The dividend of $0.2825 per share represents a return of capital to shareholders and can be indicative of the company's confidence in its ongoing cash flows and earnings stability. The waiver of dividend rights by the mutual holding company, which owns a substantial portion of the common stock, effectively concentrates the dividend distribution to the minority shareholders, potentially increasing the attractiveness of the stock to income-focused investors.

It's important to consider the historical dividend yield and payout ratio in relation to the company's earnings to assess the sustainability of the dividends. Additionally, the impact of such a dividend declaration on the company's stock price should be monitored, as it may lead to an increase in the stock's demand, especially among dividend investors. However, it is also crucial to evaluate the opportunity cost of the dividends, as the funds could alternatively be used for reinvestment in the business or for debt reduction.

Market Research Analyst

From a market perspective, TFS Financial Corporation's dividend declaration may reflect its competitive position in the savings and mortgage industry. The company's dedication to offering competitive rates and outstanding service, as well as its geographical expansion into 25 states and the District of Columbia, suggests a robust business model capable of generating sufficient earnings to support regular dividends. This move could potentially signal to the market that TFS Financial Corporation is a stable player in the financial sector, which might attract or retain investors looking for reliable income streams in their portfolios.

Furthermore, the approval by the Federal Reserve Bank of Cleveland for the mutual holding company to waive its dividend rights indicates regulatory confidence in the company's financial practices. This non-objection is a subtle yet important detail that provides an additional layer of assurance to investors about the company's regulatory standing and governance practices.

Economist

The economic implications of a dividend declaration and the waiver by the mutual holding company are multifaceted. On one hand, it injects liquidity into the market by redistributing corporate earnings to shareholders, who may then reinvest or spend the capital, potentially stimulating economic activity. On the other hand, the company's decision to distribute dividends rather than reinvesting back into the company could be seen as an indication that the company is in a mature phase with fewer high-return investment opportunities internally.

It is also pertinent to examine the broader economic environment, including interest rate trends and housing market dynamics, as they can influence the performance of savings and loan associations like TFS Financial Corporation. The state of the economy can affect consumer savings rates, borrowing behavior and ultimately, the profitability of financial institutions specializing in mortgage products.

CLEVELAND--(BUSINESS WIRE)-- TFS Financial Corporation (NASDAQ: TFSL) (the "Company"), the holding company for Third Federal Savings and Loan Association of Cleveland (the "Association"), today announced that the Board of Directors declared a quarterly cash dividend of $0.2825 per share, payable on March 21, 2024, to stockholders of record on March 7, 2024.

Chairman and CEO Marc A. Stefanski (Photo: Business Wire)

Third Federal Savings and Loan Association of Cleveland, MHC (the "MHC"), the mutual holding company of the Company and owner of 227,119,132 shares, or 80.9% of the Company's common stock outstanding, has waived its right to receive the dividend on its shares.

On July 11, 2023, the MHC received the approval of its members (depositors and certain loan customers of the Association) with respect to the waiver of dividends, and subsequently received the non-objection of the Federal Reserve Bank of Cleveland, to waive receipt of dividends on the Company's common stock the MHC owns up to an aggregate amount of $1.13 per share during the twelve months subsequent to the members' approval (ie., through July 11, 2024). The MHC previously waived the receipt of dividends paid by the Company in an aggregate amount of $0.5650 per share during the quarters ending September 30, 2023 and December 31, 2023.

Third Federal is a leading provider of savings and mortgage products, and operates under the values of love, trust, respect, a commitment to excellence and fun. Founded in Cleveland in 1938 as a mutual association by Ben and Gerome Stefanski, Third Federal's mission is to help people achieve the dream of home ownership and financial security. It became part of a public company in 2007 and celebrated its 85th anniversary in May 2023.

Third Federal, which lends in 25 states and the District of Columbia, is dedicated to serving consumers with competitive rates and outstanding service. Third Federal, an equal housing lender, has 21 full service branches in Northeast Ohio, four lending offices in Central and Southern Ohio, and 16 full service branches throughout Florida. As of December 31, 2023, the Company's assets totaled $17.05 billion.

This news release contains forward-looking statements as defined in the Securities Exchange Act of 1934 and is subject to the safe harbors created therein. The forward-looking statements contained herein include, but are not limited to, the Company's plans regarding its dividends. These forward-looking statements involve risks and uncertainties that could cause the Company's results to differ materially from management's current expectations. The Company's risks and uncertainties are detailed in its filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the fiscal year ended September 30, 2023. Forward-looking statements are based on the beliefs and assumptions of our management and on currently available information. The Company undertakes no responsibility to publicly update or revise any forward-looking statement.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240222671788/en/

Jennifer Rosa (216) 429-5037

Source: Third Federal Savings and Loan

FAQ

What is the dividend per share declared by TFS Financial Corporation (TFSL)?

TFS Financial Corporation declared a quarterly cash dividend of $0.2825 per share.

When is the dividend payable to stockholders of TFS Financial Corporation (TFSL)?

The dividend is payable on March 21, 2024, to stockholders of record on March 7, 2024.

What is the total assets value of TFS Financial Corporation (TFSL) as of December 31, 2023?

As of December 31, 2023, the Company's assets totaled $17.05 billion.

How many full-service branches does Third Federal have in Northeast Ohio?

Third Federal has 21 full-service branches in Northeast Ohio.