Best Bank Stocks To Watch Right Now

Best Bank Stocks To Watch Right Now: Washi ngton Federal Inc (WAFD)

Washington Federal, Inc., incorporated on November 15, 1994, is a bank holding company, which conducts its operations through a federally-insured savings association subsidiary, Washington Federal (Bank). The Bank is a federal savings association. The business of the Bank consists of attracting deposits from the general public and investing these funds in loans of various types, including first lien mortgages on single-family dwellings, construction loans, land acquisition and development loans, loans on multi-family and other income producing properties, home equity loans and business loans. It also invests in United States government and agency obligations and other investments permitted by applicable laws and regulations. As of September 30, 2013, Washington Federal had 182 full service branches located in Washington, Oregon, Idaho, Arizona, Utah, Nevada, New Mexico and Texas. Through its subsidiaries, the Company is also engaged in real estate investment and insurance brokerage activities. The principal sources of funds for the Company's activities are retained earnings, loan repayments (including prepayments), net deposit inflows, repayments and sales of investments and borrowings. Washington Federal's principal sources of revenue are interest on loans and interest and dividends on investments. Its principal expenses are interest paid on deposits, credit costs, general and administrative expenses, interest on borrowings and income taxes. On October 31, 2012, South Valley Bancorp, Inc. merged with and into the Company, followed by the merger of South Valley's wholly owned subsidiary, South Valley Bank & Trust, into the Bank.

Lending Activities

As of September 30, 2013, the Company's net portfolio of loans totaled $7.5 billion representing approximately 58% of its total assets. The Company concentrates its lend! ing activities on the origination of 30-year, fixed-rate mortgage loans, which are neither insured nor gu aranteed by agencies of the United States government. Washin! gton Federal's lending activity is concentrated on the origination of loans secured by real estate, including long-term fixed-rate mortgage loans, adjustable-rate construction loans, adjustable-rate land development loans, fixed-rate multi-family loans and business loans.

The Company's lending activity is the origination of real estate mortgage loans to purchase or refinance single-family residences. The Company also originates a range of construction and land development loans, along with multi-family residential and commercial loans. As of September 30, 2013, single-family residential loans totaled $5.4 billion, or 67.2% of the Company's gross loan portfolio; construction- speculative loans totaled$131 million, or 1.6% of the Company's gross loan portfolio; construction - custom loans totaled $303 million, or 3.8% of the Company's gross loan portfolio; land acquisition and development loans totaled $82 million, or 1.0% of the Company's gross loan portfolio; la nd - consumer lot loans totaled $125 million, or 1.6% of the Company's gross loan portfolio; multi-family loans totaled $836 million, or 10.5% of the Company's gross loan portfolio; commercial real estate loans totaled $625 million, or 7.8% of the Company's gross loan portfolio; commercial and industrial loans totaled $326 million, or 4.1% of the Company's gross loan portfolio; home equity line of credit (HELOC) loans totaled $134 million, or 1.7% of the Company's gross loan portfolio and consumer loans totaled $55 million, or 0.7% of the Company's gross loan portfolio.

The Company originates 30 year fixed-rate loans secured by single-family residences. The Company originates construction loans to finance construction of single-family and multi-family residences, as well as commercial properties. Loans made to individuals for construction of their home! generall! y are 30 year fixed rate loans. Multi-family residential (five or more dwelling units) loans are secure d by multi-family rental properties, such as apartment build! ings.

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The Company makes various types of business loans to customers in its market area for working capital, acquiring real estate, equipment or other business purposes, such as acquisitions. The terms of these loans range from less than one year to a maximum of 10 years. Consumer loans are home improvement loans made through third party originators that bear interest at rates of 10% and higher.

Investment Activities

As a federal association, the Bank is obligated to maintain adequate liquidity and does so by holding cash and cash equivalents and by investing in securities. These investments include, among other things, certain certificates of deposit, repurchase agreements, bankers' acceptances, loans to financial institutions whose deposits are federally-insured, federal funds, United States government and agency obligations and mortgage-backed securities.

Sources of Funds

Deposits are the source of the Company's funds for use in lending and other general business purposes. In addition to deposits, Washington Federal derives funds from loan repayments, advances from the Federal Home Loan Bank (FHLB) and other borrowings and from investment repayments and sales. The Company's deposits are obtained from residents of Washington, Oregon, Idaho, Arizona, Utah, Nevada, New Mexico and Texas. The Company obtains advances from the FHLB upon the security of the FHLB capital stock it owns and certain of its loans, provided certain standards related to credit worthiness have been met. The Company also uses reverse repurchase agreements as a form of borrowing. Under reverse repurchase agreements, the Company sells an investment security to a dealer for a period of time and agrees to buy back that security at the end of the period and pay the dealer a stated interest rate for! the use ! of the dealer's funds. The Company also offers two forms of repurchase agreements to its customers. One form has an interest rate, which floats like that of a money market d! eposit ac! count. The other form has a fixed rate and is offered in a minimum denomination of $100,000. Both forms are fully collateralized by securities. As of September 30, 2013, the Company had $46.1 million of such agreements outstanding.

Advisors' Opinion:

• [By Eric Volkman]

  Washington Federal (NASDAQ: WAFD  ) is keeping its dividend level even as it effects a corporate transformation by the end of next month. The company has declared a quarterly distribution of $0.09 per share, to be paid on July 19 to shareholders of record as of July 5. That amount matches the firm's previous distribution, which was paid in April. Prior to that, it handed out a penny less at $0.08 per share.

• [By Brian Pacampara]

  What: Shares of financial holding company Washington Federal (NASDAQ: WAFD  ) climbed as high as 10% today after its quarterly results topped Wall Street expectations. 

source from Top Stocks Blog:http://www.topstocksblog.com/best-bank-stocks-to-watch-right-now.html