EX-99.1 2 a1q2025earningsrelease.htm EX-99.1 Document


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102 Duffy Avenue, Hicksville, NY 11801 ● Phone: (516) 683-4420 ● flagstar.com

FLAGSTAR FINANCIAL, INC. REPORTS FIRST QUARTER 2025 GAAP NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS OF $0.26 PER DILUTED SHARE AND NON-GAAP ADJUSTED NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS OF $0.23 PER DILUTED SHARE



•C&I LOAN ORIGINATIONS INCREASED OVER 40% ON A LINKED-QUARTER BASIS

•ADJUSTED OPERATING EXPENSES DECLINE 22% YEAR-OVER-YEAR

•MAINTAINED STRONG CAPITAL AND LIQUIDITY POSITIONS

•NET INTEREST MARGIN STABILIZES

•CREDIT COSTS IMPROVE AS PROVISION FOR CREDIT LOSSES AND NET CHARGE-OFFS DECLINED ON A LINKED-QUARTER BASIS

•LOAN SALES AND CONTINUED MANAGEMENT EMPHASIS ON LOAN PAYOFFS DRIVE FURTHER DECLINE IN COMMERCIAL REAL ESTATE EXPOSURE

First Quarter 2025 Summary
Asset QualityLoans, Deposits, and Funding

•Total ACL of $1,215 million or 1.82% of total loans HFI compared to 1.83% in previous quarter
•Multi-family ACL coverage of 1.82% v. 1.87% in Q4'24
•Multi-family with rent-regulated units equal to or greater than 50% ACL at 2.82% v. 2.89% in Q4'24
•Office ACL coverage at 6.88% v. 7.01% in Q4'24
•Par pay-offs totaled $840 million with 59% being substandard loans
•NCOs declined $107 million, or 48% to $115 million
•NCOs on an annualized basis declined 55 basis points to 0.68% of average loans
•Criticized loans declined $885 million or 6%

•Continue to reduce total CRE exposure
•Multi-family loans down $656 million or 2%
•CRE loans down $326 million or 3%

•Commercial lending business building momentum
•Over 4% loan growth in focus areas vs. prior quarter
•New credit commitments totaled $1,046 million, up 32%
•Originations were $769 million, up 42% v. Q4'24
•Q1 deposits reflect further payoffs of brokered deposits
•Brokered deposits declined $1.9 billion or 19%
CapitalLiquidity

•CET1 capital ratio improved to 11.9%, at or above peer group levels
•Book value per common share of $18.43
•Tangible book value per share of $17.33

•Ample total liquidity of $30 billion
•Represents 231% coverage on uninsured deposits
•$18.1 billion of available borrowing capacity and high-quality liquid assets

Flagstar Financial, Inc. Reports First Quarter 2025 Results
Hicksville, N.Y., April 25, 2025 – Flagstar Financial, Inc. (NYSE: FLG) (“the Company”), today reported results for first quarter 2025. First quarter 2025 net loss was $100 million compared to a net loss of $188 million for fourth quarter 2024, and a net loss of $327 million for first quarter 2024. The net loss attributable to common stockholders for first quarter 2025 was $108 million, or $0.26 per diluted share, compared to a net loss attributable to common stockholders of $196 million, or $0.47 per diluted share for fourth quarter 2024, and a net loss attributable to common stockholders of $335 million, or $1.36 per diluted share for first quarter 2024.

CEO COMMENTARY

Commenting on the Company's first quarter 2025 performance, Chairman, President, and Chief Executive Officer, Joseph M. Otting stated, “I am very pleased with our solid financial results and operating performance during the quarter, as we continue to make progress on returning to profitability, executing on our strategic plan, and transforming the Company into a top-25 performing regional bank. In 2024, we successfully built capital, improved liquidity, and enhanced the credit quality of our loan portfolio. As a result, we begin the year in a strong balance sheet position with a CET1 capital ratio of around 12%, ACL reserve coverage of 1.82%, and ample liquidity of about $30 billion.

“Our 2025 focus is improving our earnings profile, executing on our C&I and Private Bank growth strategy, continuing to manage lower our commercial real estate exposure, and on credit normalization. Our first quarter operating trends reflect this focus. We reduced operating expenses and are on pace to meet our $600 million cost savings goal, reduced our credit costs as both the provision for credit losses and net charge-offs declined, our net interest margin was stable compared to the fourth quarter, we continued to reduce our multi-family and commercial real estate portfolios, and made further progress in our C&I business, adding additional talent and originating nearly $770 million in new loans, up over 40% compared to what we originated in the fourth quarter. More importantly, we grew C&I loans in our focus areas by over 4% compared to last quarter.

“During the quarter, we added 15 talented bankers in our commercial lending business bringing the total to 75 since we started expanding this business, and we plan to add another 80 to 90 bankers during the remainder of 2025. Additionally, we announced the hiring of Mark Pittsey to lead our Private Bank and Wealth Management businesses. Mark's extensive background will help drive continued growth in these two core business lines.

“On the credit quality front, criticized loans declined 6% compared to the prior quarter, and although we had a pick-up in non-accrual loans, this was largely due to one credit relationship. Our total allowance for credit losses was 1.82%, virtually unchanged from the previous quarter, while reserve coverage on multi-family loans with rent-regulated units at 50% or more of the total units was 2.82%.

“The significant strides we made in 2024 have laid the groundwork for growth and have established a path to profitability by fourth quarter 2025. While the near-term macro environment is filled with some uncertainties, I remain confident in our ability to execute on our strategic plan and to transform the Company into a high-performing, top-tier regional bank.

“Lastly, I would like to especially thank all of our teammates whose dedication and commitment to the organization and its customers has been unmatched.”

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Flagstar Financial, Inc. Reports First Quarter 2025 Results
BALANCE SHEET SUMMARY AS OF MARCH 31, 2025

At March 31, 2025, total assets were $97.6 billion, down $2.5 billion or 3% versus December 31, 2024. The linked-quarter decline was driven by a decrease in total loans and leases held for investment ("HFI") as the Company continues to reduce its commercial real estate ("CRE") exposure, along with a decrease in cash balances. During the first quarter 2025, we re-deployed some of our liquidity into available-for-sale ("AFS") investment securities. Accordingly, AFS investment securities rose $2.4 billion or 23% to $12.8 billion on a linked-quarter basis.

Total loans and leases held for investment at March 31, 2025 were $66.6 billion, down $1.7 billion or 2% on a linked-quarter basis. The multi-family loan portfolio declined $656 million or 2% to $33.4 billion on a linked-quarter basis while the CRE portfolio decreased $326 million or 3% on a linked-quarter basis to $11.5 billion. The linked-quarter decrease was the result of exiting non-relationship borrowers, par payoffs, and loan sales, at or close to current valuations, that were previously disclosed during the fourth quarter of 2024. The declines in both of these portfolios is a continuation of the Company's overall strategy to diversify the loan portfolio by reducing its multi-family and CRE exposure.

Total commercial and industrial ("C&I") loans declined $634 million or 4% to $14.7 billion on a linked-quarter basis. The linked-quarter decrease is due to the Company's strategy to reduce non-core loans within the specialty finance and leasing portfolios, as well as reducing exposures in the MSR lending business.

We experienced another strong quarter of production from our new C&I lending teams. During first quarter 2025, new credit commitments totaled $1,046 million of which we funded $769 million compared to $789 million and $542 million, respectively, in fourth quarter 2024.

Total deposits at March 31, 2025 were $73.9 billion, a $2.0 billion or 3% linked-quarter decrease. The linked-quarter decline was driven by the sale of our mortgage servicing/sub-servicing and third-party origination business during the fourth quarter of 2024, which included the transfer of mortgage escrow deposits to the buyer. Non-interest-bearing deposits declined $739 million or 5% on a linked-quarter basis due to the sale of the mortgage servicing business.

Certificates of deposit ("CDs") decreased $1.4 billion or 5% to $25.9 billion on a linked-quarter basis. The linked-quarter decline was driven by a decrease in brokered CDs, reflecting our strategy to reduce higher cost funding. During the first quarter, the Company paid off approximately $1.4 billion in brokered CDs.

At March 31, 2025, wholesale borrowings totaled $13.2 billion, down $250 million or 2% on a linked-quarter basis. After rebuilding our liquidity position over the course of 2024 through deposit growth and asset sales, we paid down wholesale borrowings, primarily Federal Home Loan Bank of New York ("FHLB-NY") advances, in the second half of 2024. In first quarter 2025, we paid off $250 million of FHLB-NY advances.

NET INCOME (LOSS) | NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS - AS ADJUSTED

First quarter 2025 results included two notable items. These items include $6 million in lease cost acceleration related to our previously announced branch closures and $5 million in trailing costs related to the sale of our mortgage servicing/sub-servicing and third-party origination business during the fourth quarter of last year. In addition, the Company also incurred $8 million of merger-related expenses during the quarter. As adjusted for these items, the net loss for first quarter 2025 was $86 million and the net loss attributable to common stockholders was $94 million or $0.23 per diluted share. This compares to a fourth quarter 2024 net loss, as adjusted for merger-related expenses and for certain items related to the sale of the servicing/sub-servicing and third-party origination business, severance costs, and long-term asset impairment charges related to various Company-owned or leased properties, of $158 million and a net loss attributable to common stockholders of $166 million or $0.40 per diluted share. First quarter 2024, net loss and net loss attributable to common stockholders, as adjusted for merger-related and restructuring expenses and the bargain purchase gain, was $174 million and $182 million or $0.74 per diluted share, respectively.

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Flagstar Financial, Inc. Reports First Quarter 2025

EARNINGS SUMMARY FOR THE THREE MONTHS ENDED MARCH 31, 2025

Net Interest Income, Net Interest Margin, and Average Balance Sheet

Net Interest Income

Net interest income for the first quarter 2025 totaled $410 million, down $51 million, or 11%, compared to fourth quarter 2024. The linked-quarter decline was driven by a smaller balance sheet partially offset by lower funding costs. Average loan balances decreased over the past five quarters due to several strategic actions that began during early 2024, including the sale of our mortgage warehouse business and mortgage servicing/sub-servicing and third-party origination business, a strategic reduction in the multi-family and commercial real estate portfolios from a combination of par payoffs and strategic loan sales, and lower net C&I balances as our growth was outpaced by the pay-down of certain non-core, non-strategic relationships. During first-quarter 2025, we utilized a portion of our cash position to purchase higher yielding investment securities. The decrease in average loan balances was partially offset by a lower level of average borrowed funds, as the Company paid off a substantial amount of wholesale borrowings, primarily FHLB-NY advances during 2024.

Net Interest IncomeMarch 31, 2025
For the Three Months Ended compared to (%):
(dollars in millions)March 31, 2025December 31, 2024 March 31, 2024December 31, 2024 March 31, 2024
Net interest income$410 $461$624 -11 % -34 %

Net Interest Margin

During first quarter 2025, we stabilized the net interest margin ("NIM") as compared to fourth-quarter 2024. First-quarter 2025 NIM was 1.74%, up 1 basis point compared to fourth quarter 2024, but down 54 basis points compared to first quarter 2024. The linked-quarter improvement was driven by a 25 basis point decrease in the cost of average total interest-bearing liabilities to 4.02% partially offset by a 21 basis point decrease in the average total interest-earnings assets. The average cost of interest-bearing deposits dropped 34 basis points to 3.85% reflecting a decline in market rates, along with a $3.8 billion or 6% decrease in average interest-bearing deposits to $61.7 billion. Additionally, average borrowed funds declined $3.6 billion or 20% to $14.4 billion, while their cost increased 15 basis points to 4.71%.

Average loan balances declined $3.5 billion or 5% to $68.2 billion on a linked-quarter basis, while the average loan yield also declined 22 basis points to 5.06%. Average cash balances declined $7.7 billion or 35% to $14.3 billion as we used a portion of our cash to purchase investment securities and pay down wholesale borrowings. Average investment securities rose modestly, up $720 million or 5.83% to $13.1 billion.

The year-over-year decline in the NIM was due to several factors including lower average total interest-earnings assets due to our strategic actions to sell certain businesses and reduce our commercial real estate concentrations, offset partially by a reduction in average wholesale borrowings, as well as lower overall market interest rates. The average yield on interest-earnings assets declined 61 basis points on a year-over-year basis, while average balances declined $14.4 billion or 13%. This was only partially offset by a 17 basis point decrease in the average cost interest-bearing liabilities, while these average balances decreased $9.2 billion or 11%.

Year-over-year, average loan balances declined $15.9 billion or 19%, while the average loan yield dropped 62 basis points. Average securities balances increased $1.5 billion or 13% along with a corresponding 29 basis point increase in the average yield. This was offset in part by an $11.4 billion or 44% decrease in average borrowings, along with a 28 basis point decrease in the average cost of borrowings. Average deposit balances rose $2.2 billion or 4% on a year-over-year basis, while the average cost of deposits remained unchanged.
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Flagstar Financial, Inc. Reports First Quarter 2025


March 31, 2025
For the Three Months Ended compared to (bp):
Yield/CostMarch 31, 2025December 31, 2024March 31, 2024December 31, 2024March 31, 2024
Mortgage and other loans, net
5.06% 5.28% 5.68% -22 -62
Securities
4.59%4.77%4.30%-1829
Interest-earning cash and cash equivalents
4.42% 4.79% 5.52% -37 -110
Total interest-earning assets4.90%5.11%5.51%-21-61
Total interest-bearing deposits
3.85% 4.19% 3.85% -34 0
Borrowed funds
4.71%4.56%4.99%15-28
Total interest-bearing liabilities4.02% 4.27% 4.19% -25 -17
Net interest margin1.74%1.73%2.28%1-54

Average Balance Sheet
March 31, 2025
For the Three Months Ended compared to:
(dollars in millions)March 31, 2025December 31, 2024March 31, 2024December 31, 2024 March 31, 2024
 Mortgage and other loans, net
$68,212 $71,727$84,123-5 %-19 %
Securities
13,06712,34711,5766 %13 %
Interest-earning cash and cash equivalents
14,344 22,04814,345-35 % — %
Total interest-earning assets95,623 106,122110,044-10 % -13 %
Total interest-bearing deposits
61,72765,57659,539-6 %4 %
Borrowed funds
14,377 17,94025,728-20 % -44 %
Total interest-bearing liabilities76,10483,51685,267-9 %-11 %
Non-interest-bearing deposits$13,068 $15,959$19,355-18 % -32 %



Provision for Credit Losses

For the three months ended March 31, 2025, the provision for credit losses decreased $66 million compared to the three months ended December 31, 2024. This decrease is primarily due to lower net charge-offs, our continued focus on credit reviews, and the receipt of recent appraisals. Additionally, our ACL balance decreased since December 31, 2024, as result of the on-going strategic reduction of our multi-family, CRE and non-core C&I portfolios. The reduction in our ACL balance was partially offset by the negatively trending macro-economic environment.

Net charge-offs for the first quarter 2025 totaled $115 million, down $107 million or 48% compared to fourth quarter 2024, but were up $34 million or 42% compared to first quarter 2024. Net charge-offs on an annualized basis represented 0.68% of average loans outstanding, compared to 1.23% of fourth quarter 2024 and compared to 0.39% during first quarter 2024.


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Flagstar Financial, Inc. Reports First Quarter 2025

Pre-Provision Net Revenue

The table below details the Company’s PPNR and related measures, which are non-GAAP measures, for the periods noted:

March 31, 2025
For the Three Months Ended compared to:
(dollars in millions)March 31, 2025December 31, 2024March 31, 2024December 31, 2024March 31, 2024
Net interest income$410 $461 $624 -11 %-34 %
Non-interest income80 164 9 -51 %789 %
Total revenues$490 $625 $633 -22 %-23 %
Total non-interest expense532 718 699 -26 %-24 %
Pre - provision net loss (non-GAAP)$(42)$(93)$(66)NMNM
Bargain purchase gain— — 121 NMNM
Merger-related and restructuring expenses8 12 43 -33 %-81 %
Net impact of mortgage/servicing sale and related activity— (80)— NMNM
Severance costs— 31 — NMNM
Long term asset impairment— 77 — NMNM
Lease cost acceleration related to closing branches6 — — NMNM
Trailing mortgage sale costs with Mr. Cooper5 — — NMNM
Pre - provision net (loss)/revenue, as adjusted (non-GAAP)$(23)$(53)$98 NMNM

For the first quarter 2025, pre-provision net loss totaled $42 million compared to a pre-provision net loss of $93 million for fourth quarter 2024 and a pre-provision net loss of $66 million for first quarter 2024. First quarter 2025 pre-provision net loss included two notable items including $6 million related to lease cost accelerated related to branch closures and $5 million in trailing costs related to the sale of the mortgage servicing/sub-servicing and third-party originations business. As adjusted for these items and for merger-related expenses, the first quarter pre-provision net loss improved to $23 million compared to a pre-provision net loss of $53 million for fourth quarter 2024 and pre-provision net revenue of $98 million for first quarter 2024.





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Flagstar Financial, Inc. Reports First Quarter 2025

Non-Interest Income

In first quarter 2025, non-interest income totaled $80 million compared to $164 million in fourth quarter 2024 and $9 million in first quarter 2024. Included in fourth quarter 2024 non-interest income was a $89 million gain on the sale of our mortgage servicing/sub-servicing and third-party origination business, while first quarter 2024 non-interest income included a bargain purchase gain of $121 million. As adjusted for these items, first quarter 2025 non-interest income increased $8 million or 11% from $72 million in fourth quarter 2024, but declined $50 million or 38% from $130 million in first-quarter 2024.

The linked-quarter increase was primarily due to higher net gain on loan sales and securitizations, up $8 million to $13 million and higher other income, up $2 million or 7%, partially offset by lower fee income, down $11 million or 33%. The year-over-year decline was due to lower fee income, down $12 million or 35%, lower net gain on loan sales and securitizations, down $7 million or 35%, and lower net loan administration income, down $12 million or 75%; partially offset by a $2 million or 7% increase in other income. Both the linked-quarter and year-over-year declines in our net return on mortgage servicing rights and net loan administration income are due to the sale of our mortgage servicing/sub-servicing and third-party origination business during fourth quarter 2024.

March 31, 2025
For the Three Months Ended compared to:
(dollars in millions)March 31, 2025 December 31, 2024 March 31, 2024December 31, 2024 March 31, 2024
Fee income$22 $33 $34 -33 %-35 %
Bank-owned life insurance101010— %— %
Net return on mortgage servicing rights— (1) 21 NMNM
Net gain on loan sales and securitizations13520160 %-35 %
Net gain on mortgage/servicing sale—89—NMNM
Net loan administration income (loss)4 (1) 16 NM -75 %
Bargain purchase gain——(121)NMNM
Other income31 29 29 7 % 7 %
Total non-interest income$80$164$9-51 %789 %
 
         
Impact of Adjustments:
Bargain purchase gain— — 121 NM NM
Gain on mortgage/servicing sale and related activity—(92)—NMNM
Adjusted noninterest income (non-GAAP)$80$72$13011 %-38 %



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Flagstar Financial, Inc. Reports First Quarter 2025

Non-Interest Expense

First quarter 2025 non-interest expense totaled $532 million, down $186 million or 26% on a linked-quarter basis and down $167 million or 24% on a year-over-year basis. Both first quarter 2025 and fourth-quarter 2024 included a number notable items compared to no such items in first-quarter 2024. Fourth-quarter 2024 included $31 million of severance costs, $77 million of long-term asset impairment costs, and $12 million of costs related to the sale of the mortgage servicing/sub-servicing business. First quarter 2025 included $6 million of lease cost acceleration related to branch closures and $5 million in trailing costs related to the sale of the mortgage servicing/sub-servicing business.

As adjusted for these items and excluding intangible asset amortization and merger-related expenses, first quarter 2025 non-interest expenses totaled $485 million, down $71 million or 13% on a linked-quarter basis and down $136 million or 22% on a year-over-year basis. The linked-quarter decreases were driven by a $27 million or 10% decline in compensation and benefits expense, a $24 million or 32% decrease in FDIC insurance expense, and a $21 million or 13% decline in general and administrative expenses. The year-over-year decline was the result of an $89 million or 27% decrease in compensation and benefits expense and a $44 million or 24% decline in general and administrative expenses.

March 31, 2025
For the Three Months Ended compared to:
(dollars in millions)March 31, 2025 December 31, 2024 March 31, 2024December 31, 2024 March 31, 2024
Operating expenses:         
Compensation and benefits$244$302$333-19 %-27 %
FDIC insurance507450-32 %— %
Occupancy and equipment55485215 %6 %
General and administrative147252186 -42 % -21 %
Total operating expenses496 676 621 -27 %-20 %
Intangible asset amortization
28  31  35  -10 % -20 %
Merger-related and restructuring expenses
8 11 43 -27 %-81 %
Total non-interest expense$532 $718 $699 -26 % -24 %
Impact of Adjustments:
Total operating expenses$496$676$621-27 %-20 %
Severance costs
—(31)—NMNM
Long term asset impairment
—(77)— NMNM
Lease cost acceleration related to closing branches.(6)— — NMNM
Trailing mortgage sale costs with Mr. Cooper(5)— — NMNM
Certain items related to sale of mortgage servicing business—(12)— NMNM
Adjusted noninterest expense (non-GAAP)$485$556$621-13 %-22 %


Income Taxes

For the first quarter 2025, the Company reported a benefit for income taxes of $21 million compared to a benefit for income taxes of $50 million for the fourth quarter 2024 and a benefit of $54 million for the three months ended March 31, 2024. The effective tax rate for the first quarter 2025 was 17.82% compared to 21.32% for the fourth quarter 2024, and 14.32% for the three months ended March 31, 2024.



8
Flagstar Financial, Inc. Reports First Quarter 2025

ASSET QUALITY
March 31, 2025
As ofcompared to:
(dollars in millions)March 31, 2025 December 31, 2024 March 31, 2024December 31, 2024 March 31, 2024
Total non-accrual loans held for investment$3,280$2,615$798 25 %311 %
Non-accrual loans held for sale$21$323$15-93 %NM
NPLs to total loans held for investment4.93 % 3.83 % 0.97 % 110 396
NPAs to total assets3.37 %2.62 %0.72 %75265
Allowance for credit losses on loans and leases$1,168 $1,201 $1,215 (3)% (4)%
Total ACL, including on unfunded commitments$1,215$1,251$1,288(3)%(6)%
ACL % of total loans held for investment1.75 % 1.76 % 1.48 % -1 bps 28 bps
Total ACL % of total loans held for investment1.82 %1.83 %1.56 %-1 bps 26 bps
ACL on loans and leases % of NPLs36%46%152%-10 % -117 %
Total ACL % of NPLs37%48%161%-11 %-124 %
March 31, 2025
For the Three Months Ended compared to:
March 31, 2025December 31, 2024March 31, 2024December 31, 2024March 31, 2024
Net charge-offs
$115$222$81 -48 %42 %
Net charge-offs to average loans (1)
0.68 %1.23 %0.39 %-55 bps30 bps
(1) Three months ended presented on an annualized basis.

Non-Performing Assets

At March 31, 2025, total non-accrual loans, including held-for-sale, were $3,301 million, up $363 million or 12% compared to December 31, 2024. The linked-quarter increase was primarily due to higher non-accrual multi-family loans and a majority of this increase was tied to one borrower relationship. Excluding this relationship, total non-accrual loans would have decreased $35 million or 1.3%. The year-over-year increase was driven by increased multi-family and commercial real estate, mostly office-related, non-accruals, as the Company proactively dealt with potential credit issues throughout 2024.

Total non-accrual loans HFI to total loans HFI were 4.9% at March 31, 2025 compared to 3.8% at December 31, 2024 and 0.97% at March 31, 2024.

Total Allowance for Credit Losses

The total allowance for credit losses was $1,215 million at March 31, 2025 compared to $1,251 million at December 31, 2024 and $1,288 million at March 31, 2024. The total allowance for credit losses on loans and leases at March 31, 2025 was $1,168 million compared to $1,201 million at December 31, 2024 and $1,215 million at March 31, 2024.

The total allowance for credit losses to total loans at March 31, 2025 was 1.82% compared to 1.83% at December 31, 2024 and 1.56% at March 31, 2024. The total allowance for credit losses on loans and leases to total loans held for investment was 1.75% at March 31, 2025 compared to 1.76% at December 31, 2024 and 1.48% at March 31, 2024.

The allowance for credit losses in the first quarter declined slightly as a result of our ongoing focus on credit and declines in total loans, held-or-investment. Additionally, we had a 48% decline in net charge-offs.

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Flagstar Financial, Inc. Reports First Quarter 2025

CAPITAL POSITION

The Company’s regulatory capital ratios continue to exceed regulatory minimums to be classified as “Well Capitalized,” the highest regulatory classification. The table below depicts the Company’s and the Bank’s regulatory capital ratios at those respective periods.

March 31, 2025December 31, 2024
REGULATORY CAPITAL RATIOS: (1)
Flagstar Financial, Inc.
Common equity tier 1 ratio11.90 %11.83 %
Tier 1 risk-based capital ratio12.66 %12.57 %
Total risk-based capital ratio15.25 %15.14 %
Leverage capital ratio8.45 %7.68 %
Flagstar Bank, N.A.
Common equity tier 1 ratio13.36 %13.21 %
Tier 1 risk-based capital ratio13.36 %13.21 %
Total risk-based capital ratio14.62 %14.47 %
Leverage capital ratio8.91 %8.05 %

(1)The minimum regulatory requirements for classification as a well-capitalized institution are a common equity tier 1 capital ratio of 6.5%; a tier one risk-based capital ratio of 8.00%; a total risk-based capital ratio of 10.00%; and a leverage capital ratio of 5.00%.


Flagstar Financial, Inc.

Flagstar Financial, Inc. is the parent company of Flagstar Bank, N.A., one of the largest regional banks in the country. The Company is headquartered in Hicksville, New York. At March 31, 2025, the Company had $97.6 billion of assets, $67.1 billion of loans, deposits of $73.9 billion, and total stockholders’ equity of $8.2 billion. Flagstar Bank, N.A. operates approximately 400 locations across nine states, with strong footholds in the greater New York/New Jersey metropolitan region and in the upper Midwest, along with a significant presence in fast-growing markets in Florida and the West Coast.


Post-Earnings Release Conference Call

The Company will host a conference call on April 25, 2025 at 8:00 a.m. (Eastern Time) to discuss its first quarter 2025 performance. The conference call may be accessed by dialing (888) 596-4144 (for domestic calls) or (646) 968-2525 (for international calls) and providing the following conference ID: 5857240. The live webcast will be available at ir.flagstar.com under Events.

A replay will be available approximately three hours following completion of the call through 11:59 p.m. on April 29, 2025 and may be accessed by calling (800) 770-2030 (domestic) or (609) 800-9909 (international) and providing the following conference ID: 5857240. In addition, the conference call will be webcast at ir.flagstar.com and archived through 5:00 p.m. on May 23, 2025.

Investor Contact: Salvatore J. DiMartino (516) 683-4286
Media Contact: Steven Bodakowski (248) 312-5872

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Flagstar Financial, Inc. Reports First Quarter 2025

Cautionary Statements Regarding Forward-Looking Statements

This earnings release 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) revenues, earnings, loan production, asset quality, liquidity position, capital levels, risk analysis, divestitures, acquisitions, and other material transactions, among other matters; (b) the future costs and benefits of the actions we may take; (c) our assessments of credit risk and probable losses on loans and associated allowances and reserves; (d) our assessments of interest rate and other market risks; (e) our ability to achieve profitability goals within projected timeframes and to execute on our strategic plan, including the sufficiency of our internal resources, procedures and systems; (f) our ability to attract, incentivize, and retain key personnel and the roles of key personnel; (g) our ability to achieve our financial and other strategic goals, including those related to our merger with Flagstar Bancorp, Inc., which was completed in December 2022, our acquisition of substantial portions of the former Signature Bank through an FDIC-assisted transaction, which was completed in March 2023, and our ability to fully and timely implement and maintain the risk management programs institutions greater than $100 billion in assets must maintain; (h) the impact of the $1.05 billion capital raise we completed in March 2024; (i) our previously disclosed material weaknesses in internal control over financial reporting; (j) the conversion or exchange of shares of the Company’s preferred stock; (k) the payment of dividends on shares of the Company’s capital stock, including adjustments to the amount of dividends payable on shares of the Company’s preferred stock; (l) the availability of equity and dilution of existing equity holders associated with future equity awards and stock issuances; (m) the effects of the reverse stock split we effected in July 2024; and (n) the impact of the recent sale of our mortgage servicing operations, third party mortgage loan origination business, and mortgage warehouse business.

Forward‐looking statements are typically identified by such words as “believe,” “expect,” “anticipate,” “intend,” “outlook,” “estimate,” “forecast,” “project,” “should,” "confident," and other similar words and expressions, and are subject to numerous assumptions, risks, and uncertainties, which change over time. Additionally, forward‐looking statements speak only as of the date they are made; the Company does not assume any duty, and does not undertake, to update our forward‐looking statements. Furthermore, because forward‐looking statements are subject to assumptions and uncertainties, actual results or future events could differ, possibly materially, from those anticipated in our statements, and our future performance could differ materially from our historical results.

Our forward‐looking statements are subject to, among others, the following principal risks and uncertainties: general economic conditions and trends, either nationally or locally; conditions in the securities, credit and financial markets; changes in interest rates; changes in deposit flows, and in the demand for deposit, loan, and investment products and other financial services; changes in real estate values; changes in the quality or composition of our loan or investment portfolios, including associated allowances and reserves; changes in future allowance for credit losses, including changes required under relevant accounting and regulatory requirements; the ability to pay future dividends; changes in our capital management and balance sheet strategies and our ability to successfully implement such strategies; recent turnover in our Board of Directors and our executive management team; changes in our strategic plan, including changes in our internal resources, procedures and systems, and our ability to successfully implement such plan; our ability to successfully remediate our previously disclosed material weaknesses in internal control over financial reporting; changes in competitive pressures among financial institutions or from non‐financial institutions; changes in legislation, regulations, and policies; the impacts of tariffs, sanctions and other trade policies of the United States and its global trading counterparts; the imposition of restrictions on our operations by bank regulators; the outcome of pending or threatened litigation, or of investigations or any other matters before regulatory agencies, whether currently existing or commencing in the future; our ability to fully and timely implement and maintain the risk management programs institutions greater than $100 billion in assets must maintain; the restructuring of our mortgage business; our ability to recognize anticipated cost savings and enhanced efficiencies with respect to our balance sheet and expense reduction strategies; the impact of failures or disruptions in or breaches of the Company’s operational or security systems, data or infrastructure, or those of third parties, including as a result of cyberattacks or campaigns; the impact of natural disasters, extreme weather events, civil unrest, international military conflict, terrorism or other geopolitical events; and a variety of other matters which, by their nature, are subject to significant uncertainties and/or are beyond our control. Our forward-looking statements are also subject to the following principal risks and uncertainties with respect to our merger with Flagstar Bancorp, which was completed in December 2022, and our acquisition of substantial portions of the former Signature Bank through an FDIC-assisted transaction, which was completed in March 2023: the possibility that the anticipated benefits of the transactions will not be realized when expected or at all; the possibility of increased legal and compliance costs, including with respect to any litigation or regulatory actions related to the business practices of acquired companies or the combined business; diversion of management’s attention from ongoing business operations and opportunities; the possibility that the Company may be unable to achieve expected synergies and operating efficiencies in or as a result of the transactions within the expected timeframes or at all; and revenues following the transactions may be lower than expected.

More information regarding some of these factors is provided in the Risk Factors section of our Annual Report on Form 10‐K for the year ended December 31, 2024, and in other SEC reports we file. Our forward‐looking statements may also be subject to other risks and uncertainties, including those we may discuss in this news release, on our conference call, during investor presentations, or in our SEC filings, which are accessible on our website and at the SEC’s website, www.sec.gov.

- Financial Statements and Highlights Follow -
11


FLAGSTAR FINANCIAL, INC.
CONSOLIDATED STATEMENTS OF CONDITION (unaudited)
March 31, 2025
compared to
(dollars in millions)March 31, 2025December 31, 2024March 31, 2024December 31, 2024March 31, 2024
Assets
Cash and cash equivalents$12,614 $15,430 $12,890 -18 %-2 %
Securities:
Available-for-sale12,826 10,402 9,336 23 %37 %
Equity investments with readily determinable fair values, at fair value14 14 14 — %— %
Total securities net of allowance for credit losses12,840 10,416 9,350 23 %37 %
Loans held for sale531 899 981 -41 %-46 %
Loans and leases held for investment:
Multi-family33,437 34,093 36,859 -2 %-9 %
Commercial real estate(1)
11,510 11,836 13,530 -3 %-15 %
One-to-four family first mortgage5,187 5,201 5,807 — %-11 %
Commercial and industrial14,742 15,376 24,418 -4 %-40 %
Other loans1,716 1,766 1,713 -3 %— %
Total loans and leases held for investment66,592 68,272 82,327 -2 %-19 %
Less: Allowance for credit losses on loans and leases(1,168)(1,201)(1,215)-3 %-4 %
Total loans and leases held for investment, net65,424 67,071 81,112 -2 %-19 %
Federal Home Loan Bank stock and Federal Reserve Bank stock, at cost1,061 1,146 1,550 -7 %-32 %
Premises and equipment, net486 562 679 -14 %-28 %
Core deposit and other intangibles459 488 590 -6 %-22 %
Mortgage servicing rights— — 1,092 
—%
—%
Bank-owned life insurance1,615 1,605 1,586 1 %2 %
Other assets2,598 2,543 3,070 2 %-15 %
Total assets$97,628 $100,160 $112,900 -3 %-14 %
Liabilities and Stockholders' Equity
Deposits:
Interest-bearing checking and money market accounts$20,809 $20,780 $22,172 — %-6 %
Savings accounts14,465 14,282 8,171 1 %77 %
Certificates of deposit25,887 27,324 26,763 -5 %-3 %
Non-interest-bearing accounts12,745 13,484 17,752 -5 %-28 %
Total deposits73,906 75,870 74,858 -3 %-1 %
Borrowed funds:
Wholesale borrowings13,150 13,400 25,708 -2 %-49 %
Junior subordinated debentures583 582 580 — %1 %
Subordinated notes445 444 439 — %1 %
Total borrowed funds14,178 14,426 26,727 -2 %-47 %
Other liabilities1,390 1,696 2,330 -18 %-40 %
Total liabilities89,474 91,992 103,915 -3 %-14 %
Mezzanine equity:
Preferred stock - Series B1 1 595 — %
—%
Stockholders' equity:
Preferred stock - Series A and D503 503 503 — %— %
Common stock4 4 3 — %33 %
Paid-in capital in excess of par9,286 9,282 8,653 — %7 %
Retained earnings(875)(763)73 15 %NM
Treasury stock, at cost(212)(219)(225)-3 %-6 %
Accumulated other comprehensive loss, net of tax:(553)(640)(617)-14 %-10 %
Total stockholders' equity8,153 8,167 8,390 — %-3 %
Total liabilities, Mezzanine and Stockholders' Equity$97,628 $100,160 $112,900 -3 %-14 %
(1)Includes Acquisition, Development, and Construction loans.

12


FLAGSTAR FINANCIAL, INC.
CONSOLIDATED STATEMENTS OF (LOSS) INCOME (unaudited)

March 31, 2025
For the Three Months Ended compared to
March 31, 2025December 31, 2024March 31, 2024December 31, 2024March 31, 2024
(dollars in millions, except per share data)
Interest Income:
Loans and leases$860 $948 $1,193 -9 %-28 %
Securities and money market investments304 410 320 -26 %-5 %
Total interest income1,164 1,358 1,513 -14 %-23 %
Interest Expense:
Interest-bearing checking and money market accounts167 205 232 -19 %-28 %
Savings accounts111 124 47 -10 %136 %
Certificates of deposit308 362 291 -15 %6 %
Borrowed funds168 206 319 -18 %-47 %
Total interest expense754 897 889 -16 %-15 %
Net interest income410 461 624 -11 %-34 %
Provision for credit losses79 145 315 -46 %-75 %
Net interest income after provision for credit losses331 316 309 5 %7 %
Non-Interest Income:
Fee income22 33 34 -33 %-35 %
Bank-owned life insurance10 10 10 — %— %
Net return on mortgage servicing rights— (1)21 NMNM
Net gain on loan sales and securitizations13 5 20 160 %-35 %
Net gain on mortgage/servicing sale— 89 — NMNM
Net loan administration (loss) income4 (1)16 NM-75 %
Bargain purchase gain— — (121)NMNM
Other income31 29 29 7 %7 %
Total non-interest income80 164 9 -51 %NM
Non-Interest Expense:
Operating expenses:
Compensation and benefits244 302 333 -19 %-27 %
FDIC insurance50 74 50 -32 %— %
Occupancy and equipment55 48 52 15 %6 %
General and administrative147 252 186 -42 %-21 %
Total operating expenses496 676 621 -27 %-20 %
Intangible asset amortization28 31 35 -10 %-20 %
Merger-related and restructuring expenses8 11 43 -27 %-81 %
Total non-interest expense532 718 699 -26 %-24 %
(Loss) income before income taxes(121)(238)(381)NMNM
Income tax (benefit) expense(21)(50)(54)NMNM
Net (loss) income(100)(188)(327)NMNM
Preferred stock dividends8 8 8 — %— %
Net (loss) income attributable to common stockholders$(108)$(196)$(335)NMNM
Basic (loss) earnings per common share$(0.26)$(0.47)$(1.36)NMNM
Diluted (loss) earnings per common share$(0.26)$(0.47)$(1.36)NMNM
Dividends per common share$0.01 $0.01 $0.15 — %-93 %



13

FLAGSTAR FINANCIAL, INC.
RECONCILIATIONS OF CERTAIN GAAP AND NON-GAAP FINANCIAL MEASURES
(dollars in millions)

While stockholders’ equity, total assets, and book value per share are financial measures that are recorded in accordance with U.S. generally accepted accounting principles (“GAAP”), tangible common stockholders’ equity, tangible assets, and tangible book value per share are not. Nevertheless, it is management’s belief that these non-GAAP measures should be disclosed in our earnings releases and other investor communications for the following reasons:

1. Tangible common stockholders’ equity is an important indication of the Company’s ability to grow organically and through business combinations, as well as its ability to pay dividends and to engage in various capital management strategies.
2. Returns on average tangible assets and average tangible common stockholders’ equity are among the profitability measures considered by current and prospective investors, both independent of, and in comparison with, the Company’s peers.
3. Tangible book value per share and the ratio of tangible common stockholders’ equity to tangible assets are among the capital measures considered by current and prospective investors, both independent of, and in comparison with, its peers.

Additionally, while diluted earnings per common share, net income, net income attributable to common stockholders, and total non-interest income are financial measures that are recorded in accordance with GAAP, financial measures that adjust these GAAP measures to exclude merger and restructuring expenses, the bargain purchase gains related to our merger with Flagstar and the Signature transaction, and certain items related to the sale of the mortgage warehouse business, are not. Nevertheless, it is management’s belief that these non-GAAP measures should be disclosed in our earnings release and other investor communications because they are not considered part of recurring operations and are included because the Company believes they may provide useful supplemental information for evaluating the underlying performance trends of the Company.

In addition, while net income is a financial measure that is calculated in accordance with GAAP, PPNR and PPNR excluding merger-related and restructuring expenses, bargain purchase gain and certain items related to the sale of the mortgage warehouse business are non-GAAP financial measures. Nevertheless, it is management’s belief that these non-GAAP measures should be disclosed in our earnings releases and other investor communications because management believes these measures are relevant to understanding the performance of the Company attributable to elements other than the provision for credit losses and the ability of the Company to generate earnings sufficient to cover estimated credit losses. These measures also provide a meaningful basis for comparison to other financial institutions since they are commonly employed and are measures frequently cited by investors and analysts.

Non-GAAP financial measures should not be considered in isolation or as a substitute for comparable measures calculated in accordance with GAAP. Moreover, the manner in which we calculate these non-GAAP measures may differ from that of other companies reporting non-GAAP measures with similar names. The following tables reconcile the above the non-GAAP financial measures we use to their comparable GAAP financial measures for the stated periods:

14


At or for the
Three Months Ended March 31,
(dollars in millions)March 31, 2025December 31, 2024March 31, 2024
Total Stockholders’ Equity$8,153 $8,167 $8,390 
Less: Other intangible assets(459)(488)(590)
Less: Preferred stock - Series A and D (503)(503)(503)
Tangible common stockholders’ equity$7,191 $7,176 $7,297 
Total Assets$97,628 $100,160 $112,900 
Less: Other intangible assets(459)(488)(590)
Tangible Assets$97,169 $99,672 $112,310 
Average common stockholders’ equity$7,700 $8,070 $7,900 
Less: Other intangible assets(478)(508)(613)
Average tangible common stockholders’ equity$7,222 $7,562 $7,287 
Average Assets$99,107 $110,489 $115,726 
Less: Other intangible assets(478)(508)(613)
Average tangible assets$98,629 $109,981 $115,113 
GAAP MEASURES:
(Loss) return on average assets (1)
(0.40)%(0.68)%(1.13)%
(Loss) return on average common stockholders' equity (2)
(5.61)%(9.73)%(16.97)%
Book value per common share$18.43 $18.47 $29.42 
Common stockholders’ equity to total assets7.84 %7.65 %6.99 %
NON-GAAP MEASURES:
(Loss) return on average tangible assets (1)
(0.35)%(0.58)%(0.61)%
(Loss) return on average tangible common stockholders’ equity (2)
(5.23)%(8.82)%(10.02)%
Tangible book value per common share$17.33 $17.30 $27.22 
Tangible common stockholders’ equity to tangible assets7.40 %7.20 %6.50 %

(1)To calculate return on average assets for a period, we divide net income, or non-GAAP net income, generated during that period by average assets recorded during that period. To calculate return on average tangible assets for a period, we divide net income by average tangible assets recorded during that period.
(2)To calculate return on average common stockholders’ equity for a period, we divide net income attributable to common stockholders, or non-GAAP net income attributable to common stockholders, generated during that period by average common stockholders’ equity recorded during that period. To calculate return on average tangible common stockholders’ equity for a period, we divide net income attributable to common stockholders generated during that period by average tangible common stockholders’ equity recorded during that period.

15


For the Three Months Ended
(dollars in millions, except per share data)March 31, 2025December 31, 2024March 31, 2024
Net (loss) income - GAAP$(100)$(188)$(327)
Merger-related and restructuring expenses, net of tax (1)
6932
Net impact of mortgage/servicing sale and related activity, net of tax—(59)—
Severance costs, net of tax—23—
Long term asset impairment, net of tax—57—
Lease cost acceleration related to closing branches - net of tax4——
Trailing mortgage sale costs with Mr. Cooper - net of tax4——
Bargain purchase gain——121
Net (loss) income, as adjusted - non-GAAP$(86)$(158)$(174)
Preferred stock dividends888
Net (loss) income attributable to common stockholders, as adjusted - non-GAAP$(94)$(166)$(182)
Diluted (loss) earnings per common share - GAAP(2)
$(0.26)$(0.47)$(1.36)
Diluted (loss) earnings per common share, as adjusted - non-GAAP(2)
$(0.23)$(0.40)$(0.74)
(1)Certain merger-related items are not taxable or deductible.
(2)On June 27, 2024, the Company announced a 1 for 3 reverse stock split, effective July 11, 2024. This reverse stock split is reflected retroactively in all periods presented.


For the Three Months Ended
March 31, 2025December 31, 2024March 31, 2024
(dollars in millions)
Net interest income$410 $461 $624 
Non-interest income801649
Total revenues$490 $625 $633 
Total non-interest expense532718699
Pre - provision net revenue (non-GAAP)$(42)$(93)$(66)
Bargain purchase gain— —121
Merger-related and restructuring expenses8 1243
Net impact of mortgage/servicing sale and related activity— (80)— 
Severance costs— 31 — 
Long term asset impairment— 77 — 
Lease cost acceleration related to closing branches6 — — 
Trailing mortgage sale costs with Mr. Cooper5 — — 
Pre - provision net revenue excluding merger-related and
restructuring expenses, as adjusted (non-GAAP)		$(23)$(53)$98 
Provision for credit losses(79)(145)(315)
Bargain purchase gain— —(121)
Merger-related and restructuring expenses(8)(12)(43)
Net impact of mortgage/servicing sale and related activity— 80—
Severance costs— (31)—
Long term asset impairment— (77)—
Lease cost acceleration related to closing branches(6)——
Trailing mortgage sale costs with Mr. Cooper(5)——
(Loss) income before taxes$(121)$(238)$(381)
Income tax (benefit) expense(21)(50)(54)
Net (Loss) Income (GAAP)$(100)$(188)$(327)


16

FLAGSTAR FINANCIAL, INC.
NET INTEREST INCOME ANALYSIS
LINKED-QUARTER AND YEAR-OVER-YEAR COMPARISONS (unaudited)
(dollars in millions)

For the Three Months Ended
March 31, 2025December 31, 2024March 31, 2024
(dollars in millions)Average BalanceInterestAverage Yield/CostAverage BalanceInterestAverage Yield/CostAverage BalanceInterestAverage Yield/Cost
Assets:
Interest-earning assets:
Mortgage and other loans, net$68,212 $860 5.06 %$71,727 $948 5.28 %$84,123 $1,193 5.68 %
Securities13,067 148 4.59 12,347 144 4.77 11,576 123 4.30 
Interest-earning cash and cash equivalents14,344 156 4.42 22,048 266 4.79 14,345 197 5.52 
Total interest-earning assets95,623 $1,164 4.90 106,122 $1,358 5.11 110,044 $1,513 5.51 
Non-interest-earning assets3,484 4,367 5,682 
Total assets$99,107 $110,489 $115,726 
Liabilities and Stockholders’ Equity:
Interest-bearing deposits:
Interest-bearing checking and money market accounts$21,023 $167 3.23 %$23,007 $205 3.54 %$26,428 $232 3.54 %
Savings accounts14,349 111 3.14 13,996 124 3.51 8,400 47 2.24 
Certificates of deposit26,355 308 4.74 28,573 362 5.04 24,711 291 4.74 
Total interest-bearing deposits61,727 586 3.85 65,576 691 4.19 59,539 570 3.85 
Borrowed funds14,377 168 4.71 17,940 206 4.56 25,728 319 4.99 
Total interest-bearing liabilities76,104 $754 4.02 83,516 $897 4.27 85,267 $889 4.19 
Non-interest-bearing deposits13,068 15,959 19,355 
Other liabilities1,732 2,440 2,563 
Total liabilities90,904 101,915 107,185 
Stockholders’ and mezzanine equity
8,203 8,574 8,541 
Total liabilities and stockholders’ equity$99,107 $110,489 $115,726 
Net interest income/interest rate spread$410 0.88 %$461 0.84 %$624 1.32 %
Net interest margin1.74 %1.73 %2.28 %
Ratio of interest-earning assets to interest-bearing liabilities1.26 x1.27 x1.29 x




17


FLAGSTAR FINANCIAL, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (unaudited)
(dollars in millions)

For the Three Months Ended
(dollars in millions, except share and per share data)March 31, 2025December 31, 2024March 31, 2024
PROFITABILITY MEASURES:
Net (loss) income$(100)$(188)$(327)
Net (loss) income attributable to common stockholders(108)(196)(335)
Basic (loss) earnings per common share(0.26)(0.47)(1.36)
Diluted (loss) earnings per common share(0.26)(0.47)(1.36)
(Loss) return on average assets(0.40)%(0.68)%(1.13)%
(Loss) return on average tangible assets (1)
(0.35)(0.58)(0.61)
(Loss) return on average common stockholders’ equity(5.61)(9.73)(16.97)
(Loss) return on average tangible common stockholders' equity (1)
(5.23)(8.82)(10.02)
Efficiency ratio108.70 114.98 110.51 
Efficiency ratio, as adjusted (2)
101.25 108.18 82.47 
Operating expenses to average assets2.00 2.45 2.15 
Interest rate spread0.88 0.84 1.32 
Net interest margin1.74 1.73 2.28 
Effective tax rate17.82 21.32 14.32 
Shares used for basic and diluted EPS per common share414,824,158415,089,512246,682,592
Common shares outstanding at the respective period-ends415,021,890414,934,628240,825,252
(1)See the reconciliations of these non-GAAP measures with the comparable GAAP measures under "Reconciliations of Certain GAAP and non-GAAP Financial Measures" above.
(2)We calculate our efficiency ratio by dividing our operating expenses by the sum of our net interest income and non-interest income, excluding the bargain purchase gain.


March 31, 2025December 31, 2024March 31, 2024
CAPITAL MEASURES:
Book value per common share$18.43 $18.47 $29.42 
Tangible book value per common share - as reported (1)
17.33 17.30 27.22 
Common stockholders’ equity to total assets7.84 %7.65 %6.99 %
Tangible common stockholders’ equity to tangible assets (1)
7.40 7.20 6.50 

(1)See the reconciliations of these non-GAAP measures with the comparable GAAP measures under "Reconciliations of Certain GAAP and non-GAAP Financial Measures" above.


18

FLAGSTAR FINANCIAL, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (unaudited)

ASSET QUALITY SUMMARY

The following table presents the Company's asset quality measures at the respective dates:

March 31, 2025
compared to
(dollars in millions)March 31, 2025December 31, 2024March 31, 2024December 31, 2024March 31, 2024
Non-accrual loans held for investment:
Multi-family$2,361 $1,755 $339 35 %NM
Commercial real estate(1)
589 564 267 4 %121 %
One-to-four family first mortgage77 70 98 10 %-21 %
Commercial and industrial231 202 73 14 %216 %
Other non-accrual loans22 24 21 -8 %5 %
Total non-accrual loans held for investment3,280 2,615 798 25 %311 %
Repossessed assets12 14 13 -14 %-8 %
Total non-accrual held for investment loans and repossessed assets$3,292 $2,629 $811 25 %306 %
Non-accrual loans held for sale:
Multi-family$— $51 $— NMNM
Commercial real estate(1)
18 215 15 NMNM
One-to-four family first mortgage3 57 — -95 %NM
Total non-accrual mortgage loans held for sale$21 $323 $15 -93 %NM
(1)Includes Acquisition, Development, and Construction loans.


The following table presents the Company's asset quality measures at the respective dates:
March 31, 2025December 31, 2024March 31, 2024
Non-accrual held for investment loans to total loans held for investment4.93 %3.83 %0.97 %
Non-accrual held for investment loans and repossessed assets to total assets3.37 2.62 0.72 
Allowance for credit losses on loans to non-accrual loans held for investment35.61 45.93 152.11 
Allowance for credit losses on loans to total loans held for investment1.75 1.76 1.48 

19


FLAGSTAR FINANCIAL, INC.
SUPPLEMENTAL FINANCIAL INFORMATION (unaudited)

The following table presents the Company's loans 30 to 89 days past due at the respective dates:

March 31, 2025
compared to
(dollars in millions)March 31, 2025December 31, 2024March 31, 2024December 31, 2024December 31, 2024
Loans 30 to 89 Days Past Due:
Multi-family$806 $749 $103 8 %683 %
Commercial real estate(1)
85 70 15 21 %467 %
One-to-four family first mortgage28 25 26 12 %8 %
Commercial and industrial92 110 60 -16 %53 %
Other loans9 11 8 -18 %13 %
Total loans 30 to 89 days past due$1,020 $965 $212 6 %381 %
(1)Includes Acquisition, Development, and Construction loans.



The following table summarizes the Company’s net charge-offs (recoveries) for the respective periods:

For the Three Months Ended
March 31, 2025December 31, 2024March 31, 2024
(dollars in millions)
Charge-offs:
Multi-family$80 $120 $11 
Commercial real estate(2)
2 51 64 
One-to-four family residential1 — — 
Commercial and industrial34 57 11 
Other7 5 5 
Total charge-offs$124 $233 $91 
Recoveries:
Multi-family$— $(1)$(1)
Commercial real estate(2)
— (2)— 
One-to-four family residential— — — 
Commercial and industrial(6)(6)(7)
Other(3)(2)(2)
Total recoveries$(9)$(11)$(10)
Net charge-offs$115 $222 $81 
Net charge-offs to average loans (1)
0.68 %1.23 %0.39 %

(1)Three months ended presented on an annualized basis.
(2)Includes Acquisition, Development, and Construction loans.
20