Thank you very much. Good afternoon, and thank you for joining our third quarter 2026 earnings call.

Our earnings release and earnings release supplement, which we will refer to on today's call, can be found in the Investor Relations section of our company website. With me on this call is Rodger Levenson, Chairman, President, and CEO.

Prior to reviewing our financial results, I would like to read our safe harbor statement. Our discussion today will include information about our management's view of future expectations, plans, and prospects that constitute forward-looking statements.

Actual results may differ materially from historical results or those indicated by these forward-looking statements due to risks and uncertainties, including, but not limited to, the risk factors in our annual report on Form 10-K and our most recent quarterly report on Form 10-Q, as well as other documents we periodically file with the Securities and Exchange Commission. All comments made during today's call are subject to the safe harbor statement.

I will now turn to our financial results. During the third quarter, WSFS's performance continued to demonstrate the strength of our franchise and diverse business model.

Results included a core EPS of $1.75, core ROA of 1.58%, and core return on tangible common equity of 20.7%, which are all above the prior-quarter level. On a year-over-year basis, core PPNR increased 15%, and core net income increased 14%, resulting in core EPS growth of 25%.

Net interest margin expanded by 1 basis point linked-quarter to 3.88%, reflecting the benefit of loan growth and higher investment securities yields, partially offset by a 4-basis-point increase in client deposit costs. We exited the rate cycle with a cumulative interest-bearing deposit beta of 41% and experienced an 18% deposit beta in the September rate hike.

We continue to see deposit pricing pressure in the market and expect our beta to drift up over time. We expect to exit 2026 with an up-cycle beta of 35% across the September rate increase and another rate increase in December.

Core fee revenue, which represents nearly a third of total revenue, declined 1% linked-quarter and increased 3% year-over-year. The growth in our fee revenue was led by Wealth and Trust, which increased 30% year-over-year and now represents approximately 60% of our total fee revenue.

Our Wealth and Trust business has delivered double-digit year-over-year growth for eight consecutive quarters, demonstrating our ability to generate growth through various interest rate and market environments. Wealth and Trust's growth was broad-based, with corporate trust, global capital markets, the Bryn Mawr Trust Company of Delaware, and private wealth all delivering double-digit growth year-over-year.

Within WSFS Institutional Services, corporate trust and global capital markets increased 45% and 48% year-over-year, respectively, reflecting continued success in winning new mandates and capturing market share. Our personal trust business, the Bryn Mawr Trust Company of Delaware, grew 22% year-over-year, driven by continued new account growth, while private wealth increased 14% year-over-year, driven by higher AUM.

Cash Connect fees declined year-over-year due to the impact of the 2025 interest rate cuts and lower volumes, but the business delivered another quarter with a profit margin of 15%, which is up meaningfully from the prior year. Gross loans grew 1% linked-quarter, or 5% annualized.

Excluding the continued run-off of the Spring EQ portfolio, loans grew 2% linked-quarter and 7% year-over-year. In commercial, we continue to see momentum in C&I, which grew 1% linked-quarter and is up 9% year-over-year.

While C&I fundings moderated from the elevated levels in recent quarters, client activity remains healthy and is supported by solid pipelines. In consumer, home lending delivered another strong origination quarter despite the interest rate environment.

Residential mortgage and home equity loans were up 6% linked-quarter and 24% year-over-year. Client deposits declined 3% linked-quarter, primarily reflecting the expected outflow of elevated transactional deposits at the end of the prior quarter within Institutional Services and commercial.

Average deposits, which are a better measure of client activity, were up slightly linked-quarter. On a year-over-year basis, average core deposits were up 10%, with average non-interest deposits growing 20%.

Non-interest deposits now represent 35% of our total average deposits. Core non-interest expenses decreased 3% linked-quarter and were generally flat year-over-year, as our efficiency ratio declined to 56.1%.

While our expenses benefited from several non-recurring items this quarter, we continue to focus on expense discipline while investing in the franchise. Turning to asset quality, most credit metrics remain stable, and we had a net recovery this quarter for the second time this year.

Year-to-date, net charge-offs totaled 3 basis points of average gross loans. Delinquencies decreased 3% linked-quarter and 11% year-over-year, reaching their lowest level in two years.

Problem assets increased by $57.5 million, or 12% linked-quarter, primarily driven by several downgrades across multifamily, construction, and C&I. Despite the linked-quarter increase, problem assets are down 16% compared to a year ago.

Non-performing assets were generally flat linked-quarter, as an increase from a student housing-related loan was offset by other payoffs. Our credit costs for the quarter included an $8 million specific reserve related to this loan.

During the quarter, we continued to execute on our capital return framework, returning $70 million of capital to shareholders, including $60 million through share repurchases. Year-to-date, we have repurchased 5.6% of our outstanding shares and returned over 90% of net income to shareholders.

We are pleased with these results and remain committed to delivering high performance. We will now open the line for questions.

Thank you. Hey, good afternoon, guys.

Good afternoon, Russell.

Hey, David. I wanted to just start, please, on the loan growth.

You guys typically talk to a mid-single-digit type of result, and that's what we saw this quarter. Just curious to get your sense for how you're thinking about the fourth quarter from both an order of magnitude and mix perspective.

C&I seems like it's still tracking really well. Then, David, broader bigger picture, with the recent backup in rates and anticipated future Fed hikes, is there an absolute level of rates where demand destruction occurs and your internal target of mid-single digits is at risk?

Russell, I would say this quarter we, as you saw, continued to kind of maintain the performance, and we got growth out of the areas where we've gotten growth over the last few quarters over the year. On the commercial side, we continue to see solid momentum within our C&I book, which is our primary area of focus, and we continue to grow that portfolio.

While fundings this quarter were a little bit weaker than what we saw in the first half of the year, the last couple of quarters, I would say they're back down to a more normalized level, consistent with where activity has been over the last couple of years versus the first half of the year, this year, which was exceptionally strong. I think this is a more normalized level and where we would expect to be.

On the consumer side, as our strategy has been to really focus on real estate secured lending, and our growth really has been coming from our mortgage portfolio and our home equity portfolio. Despite the high interest rate environment, we continue to see really good growth in that portfolio in our footprint this quarter.

The pipeline there has been coming down because of the rate environment. Clearly, with mortgages above 7%, that definitely has an impact on origination demand, we don't expect to see the kind of growth that we've been seeing over the course of the year there going forward.

On a competitive basis, we still feel like we have a differentiated origination strategy, and we still feel good about our ability to compete and grow in this market, but most likely at a slower rate there.

Okay.

Helpful. Assuming rates stay elevated.

Yeah. No, understood.

Thank you. Then switching gears to your deposit beta commentary and the slide in the deck, the 35% IB beta where you'd expect to be in fourth quarter, that is a step down or a better result than the experience in the recent rate down-cycle.

I guess my question is, sort of through the cycle with incremental hikes, would you expect to retrace to that 40%-ish level, or given your kind of well-above-peer non-interest-bearing mix and below-peer loan-to-deposit ratio, would you expect to be able to outperform kind of prior-cycle experience, and this 35% is something we should contemplate as sustainable going forward?

Yeah. Maybe just to provide a little bit more context.

In the previous rate-increasing cycle, our cumulative beta at the end of that cycle was about 50%. Then, as you indicated, on the down-cycle with the cuts that we had last year, we basically were about low 40s, 41%.

The 35% that we show here is we're assuming a December rate hike here, there's a partial month, and the normalized beta always lags a little bit. I would expect we do see continued deposit pressure and competition in the market and pricing pressure, and really we've been seeing that over the course of the year, and it's certainly continuing.

I would expect that our normalized beta would be about 45% to 50% through this increase cycle, which would be consistent with a prior increase cycle, maybe a little bit better, but not a bit higher than the 35%.

Thank you for the clarification. I appreciate it, David.

Then I guess just last one quickly if I could, in terms of Cash Connect, profit margin in that vertical up really nicely as you mentioned. Can you just remind us of the estimated impact to revenue in a rising rate environment, as well as the overall profitability profile of that vertical as the Fed hikes, and if there's anything strategically you could do to minimize kind of the negative impact of higher rates on the cash in transit?

Yeah. In terms of the numbers, for a rate increase of 25 basis points, we would have about a $2.7, $2.8 million increase to fees over the course of a year, and a similar, maybe, yeah, $2.5 million, call it, and a similar increase to expenses, maybe a little bit more.

We would have a little bit of pressure margin in a rising rate environment because of the non-interest-earning cash that you mentioned, but both would essentially go up by about $2.5 million over the course of a year. We've taken steps to really try to optimize in-transit cash, try to minimize non-interest-earning cash so that we can mitigate that impact, but the profitability impact would be several hundred thousand dollars per 25-basis-point rate hike over a year.

It shouldn't be a significant impact, and we'll look to offset it with other levers. Okay.

Got it. All right.

That's very helpful. Thank you, guys, for taking my questions.

Thanks, Russell.

Thanks. Good afternoon.

Wanted to ask about the pace of deposits and if they will track loans or if you think deposits could be faster as time passes next several quarters.

Yeah. Chris, generally, I think the way we think about it through the cycle is generally deposits tracking loans.

Our expectation is probably mid-single digits across both generally. What we've seen in the last year is deposit growth outpacing loan growth.

If you look at our loan growth has been mid-single digits, about 5%. Our deposit growth has been If you look at our core deposits, about 10% over the last year.

We really had good momentum in a couple of businesses, Institutional Services and commercial. In Institutional Services, we had a growing market, and we were able to continue to take share, and that was an important driver of the growth.

I think that's something that will normalize, and that's why we would say mid-single digit is kind of the right growth rate, probably.

Then, in general, with interest rates where they are, do you do more with the securities portfolio than you have here historically? I'm more curious if just the relative attraction of rates makes you just be even more selective on the loan side and, therefore, do more elsewhere.

Yeah. On the securities portfolio, before this year, for the last couple of years, we've been bringing down our portfolio and running it down to about the low 20s percent of assets.

When we got to this year, and we got to that level, especially with the rate increase that we've seen, we've started to reinvest proceeds, principal and interest reinvestment into new securities and taking advantage of the higher yields. That's why you've seen our portfolio yield kind of tick up over the last few quarters.

That has been an opportunity and has been a contributor to our NIM. I think it will continue to do that, but we're not anticipating growing our securities portfolio much beyond the current level.

We want to keep it in the low 20s percent of assets generally. I think we've been disciplined in not doing any restructurings.

We've been taking advantage of the opportunity to reinvest at higher yields. That securities portfolio yields about 2.80% now, and whether we reinvested in other securities at around 5% or loans at 6% or even higher, clearly we have some NIM pick-up from that, probably 4 to 5 basis points a year of NIM pick-up from the securities portfolio.

Great. That's very helpful.

Thank you for that. Just a last one for me is if interest rates were to stay high for a while, would that have any impact on the capital target that I know is 12% on a medium term?

Just curious if that would change at all.

Yeah. Generally our target still remains 12% over the medium term, but as you're alluding to, it's not a one-dimensional target, and we look at a couple different factors.

One of them, an important one, is interest rate volatility and RTC ratio. Our goal was as we get to 12%, we continue to have run-off in our AOCI, and so we continue to have our TC ratio creep up as well.

When interest rates increased this quarter, we're definitely keeping an eye on that, and so we decided to just reduce the pace of buybacks a little bit there. We did about 80% of our net income in terms of return to shareholders this quarter versus about 100% in the prior quarters.

I'd say we just took our foot off the gas a little bit and would likely stay there for this coming up quarter as well. It does have an impact.

I think the trajectory, Chris, is still towards that 12%. In any given quarter, we may deviate, but the longer-term trajectory is still towards that 12%.

Great, David. Thank you very much for taking our questions.

Thanks, Chris.

Hey, good afternoon. How does the Institutional Services and Trust business react to higher rates?

Could that slow activity there, or are the market share gains more than offset that? I'm just kind of wondering if that would have any impact on your non-interest-bearing deposits.

Yeah. Manuel, I'll talk about this quarter and then maybe going forward.

This quarter, we continue to see very healthy deal activity in that business, even though the end-of-period deposits, because of the transactional deposits that built up that we mentioned at the end of the second quarter, even though we did see that outflow, it's important to remember that that business has throughout the quarter on any given day a lot of inflow and outflow just based on the transactional activity that happens. Point-to-point is not a great measure of activity, and that's why we kind of tend to look at averages.

When we look at market share, we don't necessarily have league tables for the third quarter, but certainly in the first half of the year relative to prior year, we gained meaningful share. When you look at fee growth quarter-over-quarter, the fee growth in that business grew about 5%.

When we look at the number of deals and the deal activity quarter-over-quarter increased about 4%. All of our indicators are pointing to the fact that we're continuing to perform well and continuing to compete well in that business.

In terms of your question of just broader activity in that market, the securitization, the kind of ABS and MBS market, has consistently been very resilient. It's a broad market.

The market's grown through different rate environments, and so certainly I think if rates stay higher for longer or go up, there may be asset classes there where securitization activity is down maybe a little bit, but they're broad asset classes there, and we anticipate continued growth from that market across asset classes.

Just a quick follow-up on that, is the kind of the average non-interest-bearing deposit levels that have really had strong growth this year, is that pace of growth going to continue? Was that related to certain types of transactions that maybe you did more this year than other years in this business, or is this now maybe a better trajectory for the non-interest-bearing mix because you're having so many market share gains in this business?

If you look at year-over-year, our non-interest-bearing deposits for the company grew 20%, and certainly that's not a pace that I would expect to continue. Our goal is to, again, grow deposits mid-single digits and for us to maintain and grow non-interest-bearing at the same rate so that we overall maintain the composition of deposits that we have.

The growth that we had was actually driven across businesses. We had meaningful growth from Institutional Services.

We also had growth in commercial, and we had some non-interest-bearing growth in our consumer business as well. It wasn't a one-dimensional growth, but clearly Institutional Services had a big impact, and those transactional deposits are non-interest-bearing, and as we continue to take share, we've had outsized growth.

Again, certainly would not expect the level that we've seen over the past year to continue.

Switching gears for a second, I appreciate the commentary. Switching gears, you indicated there's an exit September NIM of 3.89%.

That's broadly positive for the fourth quarter. Could you just kind of talk about expectations going forward?

That NIM was for the whole month, right? It doesn't even have much of the impact of the rate increase.

Is that correct? Thoughts on what rate increases could do to the NIM going forward?

Yep, so, yeah, you're right. It's correct that NIM is for the month, it's got a partial month of a rate increase.

In terms of go-forward NIM, generally we remain asset-sensitive. Just as a reminder, as we had a hedging program in place to mitigate interest rate impact on the way down, but the tool that we used for that program were really floor options.

The reason why we used that tool was to maintain our upside for if the rate cycle changed and for increasing rates. We feel good strategically about that decision.

We remain asset-sensitive. I would say for every 25-basis-point increase, we would expect kind of a 2-to-3-basis-point increase in our net interest margin, but it's very dependent on the deposit beta as you would expect.

As we're seeing more elevated deposit competition, it may put some pressure on that, which we are seeing. I think somewhere in the order of maybe 2 basis points is a good way to think about it.

We obviously want to make sure that we're growing market share, we're defending our turf, and so we will be competitive on deposit pricing to do that, and that may put some pressure on that upside.

Thank you. I'll step back into the queue.

I appreciate the commentary.

Thanks, Manuel.

Hi. Thank you so much for the question.

Maybe I'll stay on the topic of margin. As you said, you are tilted asset-sensitive.

Just wondering, with loan yields in the quarter at 6.26%, I would think that new originations would be still overall accretive to the book as well. David, can you provide kind of what the yield on new loans was and how that trended versus maybe the last quarter or year-over-year?

Thanks.

I would say, Kelly, when you look at the fixed-rate loans that are maturing, there's not a material pick-up on those. I would say it's fairly neutral.

When you look at some of our new originations, clearly, when you look at mortgage, when you look at NewLane, you look at small business, they are accretive. It's a mix.

Our variable-rate loans obviously reset. Yep.

Got it. That's helpful.

Your credit sensitivity has come down after you've exited some of those higher charge-off portfolios that you've had. Obviously, with rates higher, though, maybe some deals aren't penciling, or there could be some incremental headwinds for borrowers.

I know it's early. Are you seeing anything new to watch?

I know you specifically called out the student housing credit that migrated, but just interested to hear more high-level thoughts on that. Thank you.

Hey, Kelly. It's Rodger.

The short answer to your question is we really haven't. As you recall, we have been doing a process looking forward 24 months on all maturing CRE loans and REITs, resizing those at a 7.5% coupon to see where there's potential areas of stress, and at this point, that process has not seen any kind of material impact.

Hard to predict the future, especially with how high rates might go, but at this point, we haven't seen anything, and I would just say that one particular loan that went to NPA this quarter, I would call that very one-off in a small portfolio for us with some unique circumstances.

Great. Thanks for the color, Rodger.

I appreciate it. Last one for me, I know maybe it's best to address it as part of the three separate businesses, but obviously Wealth and Trust has just been a tremendous source of growth and contribution to profitability that you have, obviously double-digit pace.

Just wondering, as you look at your opportunity for further market share gains ahead, what do you think is a sustainable intermediate-term pace of growth?

Our goal, Kelly, is to grow that business double digits. I think would not kind of expect 30% that we had this year to continue at that level, or this quarter rather, but I think double digit continues to be our goal.

I would say we benefited from good market trends and an ability to take some share on top of that, and that's really been powering the growth. When you think about Institutional Services and the securitization activity, the amount of capital that's being deployed into the capital markets, our ability to take advantage of that has been a big benefit.

When you think about our personal trust business and a lot of changes that are happening on the tax side between different states and some of the political changes that have been happening, there's been a lot of thought and a lot of movement from trusts into Delaware, and so we've been able to take advantage of that, and again, we continue to take share because we're one of the leading players in doing that. I think we've had some underlying tailwinds, and we hope that continues.

We think there's runway, but double digits is our goal on a sustained period, or sustained period of time.

Thank you so much. Nice quarter.

I'll step back.

Thanks, Kelly.

Hey, thanks for having me back. What drove the linked-quarter salary and other opex declines?

Just kind of thinking of the pretty strong efficiency ratio this quarter, how much can that sustain? I think a positive expense story is relatively newer to you, I would love to kind of understand that more.

Yeah. When you look at salaries and benefits, that was really the quarter-over-quarter the decline was was related to medical expenses.

We had some elevated more elevated medical expenses in the in the second quarter, and so you saw that decline. More broadly, Manuel, I would say this quarter benefited from maybe $2 to $3 million of favorable non-recurring items, but so maybe the run rate is, a little bit higher than what you're seeing this quarter.

Generally, our goal has been to continue to take down our efficiency ratio, and and that's both through growing the revenue as well as controlling the expense base while continuing to invest in the business. We've been able to take it down from, a little bit over 60% to now 56%, and and our goal is to continue to to gradually bring it down, but but I would say in a moderate way that allows us to to invest in the business.

I appreciate that. Again, switching gears, any commentary around the targets put out last quarter?

Credit and NIM seem to be trending better, for example. Your normal cadence is to update midyear and end of year, but just kind of thoughts on a mid-quarter another mid-quarter update as as I try for it.

Yeah. No, like you said, we typically don't update outlook at this point, but if you look at our credit trends and two out of three quarters this year, we've had recoveries.

Certainly, we did not expect it. The environment continues to be strong, our processes are good.

I think our expectation is that we would come in a bit better than our net charge-off guidance. We're not seeing, as Rodger mentioned, any major risks over the next few months that would expect us to deviate significantly to that older number.

I think our expectation is that we probably come in a little bit better on the credit side, net charge-offs.

I appreciate it. Thank you for the questions.

Hello.

Hey, Janet.

On the non-interest-bearing deposit side, this quarter, it seems like the outflows were really concentrated in what you identified as the transactional outflows. I guess it doesn't really have a seasonality component to it, or is there any identifiable trend where you have visibility into where there could be transactional outflows?

Just kind of trying to get a little more context around what that just entailed.

Yeah. Janet, this business, when you think about Institutional Services, it is a transaction-based business, and when you look across the quarter, there are meaningful flows that are coming in and out every day, really depending on the timing of the deposits.

In the last quarter, we had that inflow at the end of the quarter. It kind of coincided with the end of the quarter, but really the much more meaningful measure is the average, and that's why I think that's a more meaningful measure of client activity.

You're always going to have some volatility above that, but looking at the quarter-over-quarter and year-over-year growth in the average is a far better measure of activity. In terms of seasonality, I would say not really.

I think there are other places where there is some seasonality of deposits. For example, in our commercial business, we tend to have municipal inflows in the third quarter, which tend to come out in the fourth quarter.

In consumer, we've seen some kind of build-up into the end of the year. There are some seasonality effects that happen in other businesses, but within Institutional Services, again, last year, we had a little bit of a build-up into year-end, but it's not a pattern that I would count on.

Okay. Got it.

In terms of the lending environment, you've gave color on still solid momentum in C&I, but maybe a little weaker sentiment. Are you seeing your clients being a little bit more hesitant just given the rising rates, or is there a change in activity or sentiment you're seeing on either side of C&I or CRE, where you may have a little bit more tempered growth outlook going forward, or?

Yeah. Kind of to put it in two parts, in CRE, Janet, there is definitely some projects that people are working on which are becoming harder to pencil out to get to the debt service coverage.

I think that's something to watch. It's not been a huge driver of new originations, but it's definitely part of more of the flow that we hear being talked about, as well as maturing loans and their ability to get refinanced, whether it's with us or somebody else.

On C&I, not aware of any conversations that I've had with clients or when we're out and about that the rate environment is changing their appetite to invest. I think they're being thoughtful about investment, but I wouldn't say there's a change in appetite.

What I do think is occurring is there's a lot of competition out there, especially for C&I, and so we would expect to see some potential pressure, particularly for existing clients who are being approached by other folks. As David said, we're going to defend our turf.

At this point, I would put that still in the characterization of kind of on the margin, pretty modest, but it's definitely something we will continue to watch, especially if for some reason rates were to go a little bit higher than where they are today.

Got it. Thanks for the color.

Maybe I missed it. You alluded to the double-digit investment management and fiduciary revenue.

It seems like the double-digit is obviously in place for 2026. What could derail that trajectory maybe beyond?

Do you think the sustainability of that gives a good line of sight into sustainability of that business being able to grow in that double-digit pace even in this current environment? Cuz looks like a bulk of that is also market share gains.

Looks like that was your message, but just wanted to hear it for me again.

Yeah. Janet, I think when you look at that business, it's important to just recognize that broadly speaking, about 70% of that business is not AUM-based, and about 30% of that business is AUM-based.

On the 70% that is not AUM-based, it really is transactional activity. It's not market-driven, and they're different drivers in each of those businesses.

That's one of the benefits here is that since they're different underlying drivers, you have the capital markets and securitization markets on one side, you have personal trust activity, which is driven by policy and tax, on the other side, and then you've got the AUM activity and the markets on the third side. They're different drivers, and that's what gives us confidence that even if one of the engines is slowing down, we can have pick-up elsewhere.

I think the important thing that we want to emphasize is, again, when you look at Institutional Services, which is more than half of that business, half of the Wealth and Trust business, we're continuing to gain share in that business. You may have a slowdown in those markets, certainly if rates stay higher.

Securitization markets are not immune to that, and there will be some impact. Over the medium term, those markets are going to continue to grow, and we expect to continue to be able to perform well and pick up share in that market.

That's when we look at our indicators such as deal activity, when we look at fees, and the things that we're participating in, we continue to see signs that our performance is strong despite some volatility in the deposit side and in the market. I think it comes down to the diversity of businesses that we have there and the diversity of drivers underlying those businesses.

Okay. Thank you so much for all the color.

Okay. Thank you very much for joining our call today.

If you have any specific follow-up questions, please reach out to Andrew at Investor Relations or me. Have a great day, everyone.

Thank you.