TFSL filing — read by section

Item 9A. Controls and Procedures

Item 9A. Controls and Procedures 

 Disclosure Controls and Procedures 
 Under the supervision of and with the participation of the Company’s management, including our principal executive officer and principal financial officer, we have evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this report. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Act is accumulated and communicated to the issuer’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Based upon that evaluation, our principal executive officer and principal financial officer concluded that, as of the end of the period covered by this report, our disclosure controls and procedures were effective to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. 
 Changes in Internal Control Over Financial Reporting 
 No change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) occurred during the most recently completed fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. 
 Management’s Report Regarding Internal Control Over Financial Reporting 
 The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting as such terms are defined in Rule 13a-15(f) of the Exchange Act of 1934. Our system of internal controls is designed to provide reasonable assurance that the financial statements that we provide to the public are fairly presented. 
 Our internal control over financial reporting includes policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect transactions and dispositions of assets, (ii) provide reasonable assurances that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America and that receipts and expenditures are being made only in accordance with authorizations of management and the directors of the Company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on our financial statements. 
 All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Accordingly, absolute assurance cannot be provided that the effectiveness of the internal control systems may not become inadequate in future periods because of changes in conditions, or because the degree of compliance with the policies or procedures may deteriorate. 
 Management assessed the effectiveness of the Company’s internal control over financial reporting as of September 30, 2025. In making this assessment, the criteria set forth by the COSO in Internal Control-Integrated Framework (2013) was utilized. Management concluded that the Company's internal control over financial reporting was effective as of September 30, 2025, based on those criteria. 
 68 

 Table of Contents 

 The effectiveness of the Company's internal control over financial reporting as of September 30, 2025, has been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their report which appears herein. 
 The Sarbanes-Oxley Act Section 302 Certifications have been filed as Exhibit 31.1 and Exhibit 31.2 to this Annual Report on Form 10-K. 
 69 

 
 Table of Contents 

 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM 
 
 
 To the shareholders and the Board of Directors of TFS Financial Corporation 
 
 
 Opinion on Internal Control over Financial Reporting 
 
 
 We have audited the internal control over financial reporting of TFS Financial Corporation and subsidiaries (the “Company”) as of September 30, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of September 30, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO. 
 
 
 We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended September 30, 2025, of the Company and our report dated November 25, 2025, expressed an unqualified opinion on those financial statements. 
 
 
 Basis for Opinion 
 
 
 The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Report Regarding Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. 
 
 
 We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. 
 
 
 Definition and Limitations of Internal Control over Financial Reporting 
 
 
 A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. 
 
 
 Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. 
 
 
 /s/ Deloitte & Touche LLP 
 
 
 Cleveland, Ohio 
 November 25, 2025 
 
 
 70 

 
 Table of Contents 

 
 Item 9B. Other Information 

 Securities Trading Plans of Directors and Executive Officers 
 Transactions in our securities by our executive officers are required to be made in accordance with our Insider Trading Policy and Guidelines with Respect to Certain Transactions in Company Securities, which, among other things, requires that the transaction be in accordance with applicable U.S. federal securities laws that prohibit trading while in the possession of material nonpublic information. Rule 10b5-1 under the Securities Exchange Act of 1934 provides an affirmative defense that enables prearranged transactions in securities in a manner that avoids concerns about initiating transactions at a future date while possibly in possession of material nonpublic information. 
 During the quarter ended September 30, 2025, no trading plans , whether intended to satisfy the affirmative defense of Rule 10b5-1 or not, were terminated or adopted by a director or executive officer of the Company. 
 
 
 Item 9C. 
 Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 
 

 Not applicable. 
 
 
 
 
 PART III 
 
 Item 10. Directors, Executive Officers and Corporate Governance 

 Incorporated by reference from the Notice of Annual Meeting and Proxy Statement for the 2026 Annual Meeting of Shareholders (the “Proxy Statement”) sections entitled “Proposal One: Election of Directors,” “Executive Compensation,” “Delinquent Section 16(a) Reports” and “Corporate Governance.” The Proxy Statement will be filed with the SEC no later than 120 days after the end of the fiscal year covered by this report. 
 The table below sets forth information, as of September 30, 2025, regarding our executive officers other than Marc A. Stefanski and Meredith S. Weil, whose information is set forth under the caption "Proposal One: Election of Directors" of the Proxy Statement. 
 
 Name Title Age 
 Michael J. Carfagna 
 Chief Information Officer, the Association 
 45 
 Deborah (Debbie) L. Hand 
 Chief Risk Officer 51 
 Sandra (Sandy) M. Long 
 Chief Consumer Banking Officer, the Association 
 56 
 Susanne N. Miller Chief Accounting Officer 60 
 Timothy W. Mulhern Chief Innovation Officer, the Association 
 59 
 Andrew J. Rubino Chief Operating Officer, the Association 
 50 
 Bradley T. Stefanski Chief Strategy Officer, the Association 37 
 Gavin B. Stefanski Chief Experience Officer, the Association 
 37 
 Cathy W. Zbanek Chief Synergy Officer, the Association 52 

 The executive officers of the Company and the Association are elected annually and hold office until their respective successors are elected or until death, resignation, retirement or removal by the Board of Directors. 
 The Business Background of Our Executive Officers 
 The business experience for the past five years of each of our executive officers other than Mr. Stefanski and Ms. Weil is set forth below. Unless otherwise indicated, executive officers have held their positions for the past five years. 
 Michael J. Carfagna was named Chief Information Officer in 2025. He joined the organization in 2014 as a project manager on strategic business initiatives. Following that role, he managed marketing research before moving to Information Technology in 2020. As an IT manager, he has had responsibility for software developers working on updated programming and efficient interfaces for both internal and customer audiences, technology project managers directing system enhancements, and most recently, all information systems operations. Mr. Carfagna holds a Bachelor’s degree in Economics from Harvard University and an MSA from the University of Notre Dame. 
 71 

 Table of Contents 

 Deborah (Debbie) L. Hand joined the Association in 2008, and was named Chief Risk Officer in June 2024. Ms. Hand served in several leadership roles throughout the Company, including Default Services Manager, Internet Services Manager, and Escrow Operations Manager, before joining the Risk Management team in 2018. Since that time, she has served in various capacities in Risk Management, most recently as Chief Credit Officer. Ms. Hand holds both a Bachelor of Business Administration ( cum laude ) and Masters in Business Administration with a concentration in Finance from Kent State University. 
 Sandra (Sandy) M. Long joined Third Federal in 1993 in the retail branch system, and was named Chief Consumer Banking Officer in 2024. In her more than 30 years with the Association, she has spent much of her time in Retail Banking, including more than 10 years as a branch manager. Moving to Customer Care, she held various manager roles including Internet Banking, Customer Service, and Customer Outreach before being promoted to the manager of Customer Care. In her current role, Ms. Long leads the Third Federal retail branch system in Ohio and Florida and Customer Care. She holds a BS from the University of Akron. 
 Susanne N. Miller joined the Association in 1998 and was appointed Chief Accounting Officer in 2020. During her time with the Association, Ms. Miller has held various retail and accounting roles, and served on company-wide strategic project teams. Since 2007, she has worked as a manager in the Accounting Department, overseeing procedure implementation, corporate tax reporting and financial statement preparation. Ms. Miller holds a BS in Accounting from the University of Akron. 
 Timothy W. Mulhern was named the Chief Innovation Officer in January 2024. Mr. Mulhern joined the Association in 2003 as a project manager where he led key strategic business initiatives including a state loan expansion project, and IT projects to replace the company’s front-end servicing application, and implementation of an updated loan origination system. Mr. Mulhern moved to IT management, then to operations where he managed various departments including Loan Servicing, Default Servicing and Deposit Operations. He was named the Chief Credit Officer in 2018, and Director of Internal Audit in 2019, where he earned his CIA credentials. Mr. Mulhern joined the Finance Department in February 2021 and served as Chief Financial Officer through 2023. He holds a Bachelor’s Degree in Accounting from John Carroll University and an MBA from the Weatherhead School of Management at Case Western Reserve University. Prior to joining Third Federal, Mr. Mulhern was in public accounting with Coopers & Lybrand where he earned his CPA credentials (no longer active), and spent more than a decade as a small business owner. 
 Andrew J. Rubino h as been with the Association since 2000. He was named Chief Operating Officer in 2025, after serving as Chief Information Officer since 2021. Mr. Rubino has held a variety of leadership positions throughout the company, serving as Information Security Officer and managing several strategic areas of the company, including: Loan Production, Customer Care, Internet Services, Operations Support and Marketing, and serving as Chief Marketing Officer. He holds both a BS in Management Information Systems and an MBA from the University of Akron. 
 Bradley T. Stefanski has been with the Association since 2014, and was named Chief Strategy Officer in March 2022. He began his career at Third Federal in the Risk Management Department, working on the development of the company’s Market Risk Management Program, including modeling and testing; before moving to Loan Production and the branch system, where he spent four years in roles in Underwriting, retail management, and Operations Support project development. Mr. Stefanski then joined the Finance Department in 2021 to help drive strategic initiatives. He holds a BA in Sociology and Economics from Colgate University. Bradley T. Stefanski is the son of our Chairman of the Board, Chief Executive Officer and President, Marc A. Stefanski, and brother of our Vice Chairman of the Board, Ashley H. Williams. 
 Gavin B. Stefanski joined the Association in 2018 in the Management Training Program, supporting the company’s branch system in Southern and Northeast Ohio. Mr. Stefanski was named Underwriting Manager in 2019, Loan Production Manager in 2021, and became Chief Lending Officer in March 2022. He was named Chief Experience Officer in May 2023. Prior to Third Federal, he managed multi-billion dollar and strategic clients for ODW Logistics, a national supply chain solutions company in Hamilton, Ohio, where he was responsible for developing and maintaining customized total freight management solutions driving high revenue growth for ODW. Mr. Stefanski holds a BS in Business from the Farmer School of Business at Miami University. Gavin B. Stefanski is the nephew of our Chairman of the Board, Chief Executive Officer and President, Marc A. Stefanski, and cousin of our Vice Chairman of the Board, Ashley H. Williams. 
 72 

 Table of Contents 

 Cathy W. Zbanek joined the Association in 2001, and was named Chief Synergy Officer in 2020. In her role, Ms. Zbanek is responsible for fostering the internal synergy of the organization as well as customer engagement. She most recently served as Chief Marketing and Human Resources Officer since 2013. Prior to her roles on the executive team, Ms. Zbanek directed several of the company’s key strategic business projects as well as systems design and development. She also managed several Third Federal departments, including Customer Service and Marketing. Before joining the Association, Ms. Zbanek served as a senior consultant with Waterstone Consulting, working in their Management Consulting Group. Her experience also includes working with the consulting group, Price Waterhouse Coopers. She holds a BA in Economics and Psychology from the University of Pennsylvania . 
 The Company has adopted a policy statement entitled CODE OF ETHICS FOR SENIOR FINANCIAL OFFICERS that applies to our chief executive officer and our senior financial officers. A copy of the CODE OF ETHICS FOR SENIOR FINANCIAL OFFICERS is available on our website, www.thirdfederal.com. 
 
 
 
 
 Item 11. Executive Compensation 

 Incorporated by reference from the sections of the Proxy Statement entitled “Executive Compensation”, “Compensation Committee Report”, and “Director Compensation”. The Proxy Statement will be filed with the SEC no later than 120 days after the end of the fiscal year covered by this report. 
 
 
 
 
 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 

 Incorporated by reference from the section of the Proxy Statement entitled “Security Ownership of Certain Beneficial Owners and Management.” The Proxy Statement will be filed with the SEC no later than 120 days after the end of the fiscal year covered by this report. 
 The Company’s only equity compensation program that was not approved by shareholders is its employee stock ownership plan, which was established in conjunction with our initial stock offering completed in 2007. 
 The following table provides information as of September 30, 2025, regarding our Amended and Restated 2008 Equity Incentive Plan that was approved by shareholders on February 22, 2018. The original plan was approved by shareholders on May 29, 2008. 
 
 Plan Category Number of Shares to be
Issued Upon Exercise of
Outstanding Options,
Rights and Warrants Weighted-Average
Exercise Price of
Outstanding Options,
Rights and Warrants Number of Shares
Remaining Available
for Future Issuance
Under the Plan 
 Equity Compensation Plans 
 Approved by Stockholders 2,703,786 $ 7.19 (1) 6,286,393 
 Equity Compensation Plans 
 Not Approved by Stockholders N/A N/A N/A 
 Total 2,703,786 $ 7.19 (1) 6,286,393 

 ______________________ 
 (1) Weighted-Average Exercise Price of Outstanding Options, Rights and Warrants is calculated using 1,185,811 shares of restricted stock awards at $0.00, 288,100 shares of performance share units at $0.00, and 1,229,875 shares of stock option awards at $ 15.81 . 
 
 
 
 
 Item 13. Certain Relationships and Related Transactions, and Director Independence 

 Incorporated by reference from the sections of the Proxy Statement entitled “Certain Relationships and Related Transactions” and “Corporate Governance.” The Proxy Statement will be filed with the SEC no later than 120 days after the end of the fiscal year covered by this report. 
 
 
 
 
 Item 14. Principal Accounting Fees and Services 

 Incorporated by reference from the section of the Proxy Statement entitled “Fees Paid to Deloitte & Touche LLP (PCAOB ID No. 34 ).” The Proxy Statement will be filed with the SEC no later than 120 days after the end of the fiscal year covered by this report. 
 
 
 
 
 
 73 

 
 Table of Contents 

 PART IV 
 
 Item 15. Exhibits and Financial Statement Schedules 

 (a)(1) Financial Statements 
 The following documents are filed as part of this Annual Report on Form 10-K: 
 a. The consolidated financial statements of TFS Financial Corporation and subsidiaries contained in Part II, Item 8 of this Annual Report on Form 10-K: 
 • Consolidated Statements of Condition as of September 30, 2025 and 2024; 
 • Consolidated Statements of Income for the years ended September 30, 2025, 2024 and 2023; 
 • Consolidated Statements of Comprehensive Income for the years ended September 30, 2025, 2024 and 2023; 
 • Consolidated Statements of Shareholders' Equity for the years ended September 30, 2025, 2024 and 2023; 
 • Consolidated Statements of Cash Flows for the years ended September 30, 2025, 2024 and 2023; and 
 • Notes to the Consolidated Financial Statements 
 b. The exhibits listed in the Exhibits Index beginning on Page 126 of this Annual Report on Form 10-K. 
 
 
 
 
 Item 16. Form 10-K Summary 

 Not applicable. 
 74 

 
 Table of Contents 

 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM 
 
 
 To the shareholders and the Board of Directors of TFS Financial Corporation 
 
 
 Opinion on the Financial Statements 
 
 
 We have audited the accompanying consolidated statements of condition of TFS Financial Corporation and subsidiaries (the "Company") as of September 30, 2025 and 2024, the related consolidated statements of income, comprehensive income (loss), shareholders' equity, and cash flows, for each of the three years in the period ended September 30, 2025, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of September 30, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended September 30, 2025, in conformity with accounting principles generally accepted in the United States of America. 
 
 
 We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of September 30, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated November 25, 2025, expressed an unqualified opinion on the Company’s internal control over financial reporting. 
 
 
 Basis for Opinion 
 
 
 These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. 
 
 
 We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. 
 
 
 Critical Audit Matter 
 
 
 The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. 
 
 
 Allowance for Credit Losses – Refer to Notes 1 and 5 to the financial statements 
 
 
 Critical Audit Matter Description 
 
 
 The allowance for credit losses (“ACL”) is management’s estimate of expected credit losses in the loan portfolio, including off-balance sheet commitments. As discussed in Notes 1 and 5 of the consolidated financial statements, the ACL is an amount which represents management’s best estimate of expected credit losses over the contractual life of the Company’s loan portfolio as of the balance sheet date. The ACL for the loan portfolio is comprised of quantitative general valuation allowances for credit losses based on historical loan loss, and qualitative adjustments to the quantitative general valuation allowances to cover uncertainties that affect the estimate of expected credit losses. The ACL for off-balance sheet commitments is comprised of expected lifetime losses on unfunded loan commitments to extend credit where the obligations are not unconditionally cancellable. 
 
 
 The ACL is established using relevant available information, relating to past events, current conditions, and reasonable and supportable forecasts. The Company utilizes loan level regression models with forecasted economic data to derive the probability of default and loss given default factors. These factors are used to calculate the loan level credit loss over a 24-month reasonable and supportable period with an immediate reversion to historical mean loss rates for the remaining life of the loans. Qualitative adjustments are then made to account for factors that management does not believe are captured in the Current Expected Credit Losses (“CECL”) quantitative models. The determination of the appropriate level of the allowance for credit losses inherently involves a high degree of subjectivity and requires significant estimates of current credit risks using both quantitative and qualitative analyses. 
 
 
 Auditing certain aspects of the ACL, including the (1) model methodology, (2) model accuracy, (3) model assumptions, (4) interpretation of the results, and (5) use of qualitative adjustments, involves especially subjective and complex judgment. Given 
 75 

 Table of Contents 

 the significant judgment in determining the ACL estimate, performing audit procedures to evaluate the reasonableness of management’s estimate of the ACL requires a high degree of auditor judgment and an increased extent of effort, including the need to involve our credit specialists. 
 
 
 How the Critical Audit Matter Was Addressed in the Audit 
 
 
 Our audit procedures related to the Allowance for Credit Losses included the following, among others: 
 
 
 • We tested the effectiveness of controls over the Company’s (1) model methodology, (2) model accuracy, (3) model assumptions, (4) interpretation of the results, and (5) use of qualitative adjustments. 
 • With the assistance of our credit specialists, we evaluated the reasonableness of the (1) model methodology, (2) model accuracy, (3) model assumptions, and (4) interpretation of the results. 
 • We evaluated trends in the total ACL for consistency with trends in loan portfolio growth and credit performance. 
 • We tested the accuracy and completeness of key risk characteristics input into the model by agreeing to source information. 
 • We assessed the Company’s method for determining the qualitative factor adjustments and the effect of those factors on the ACL compared with relevant credit risk factors and credit trends. 
 
 
 
 
 /s/ Deloitte & Touche LLP 
 
 
 Cleveland, Ohio 
 November 25, 2025 
 
 
 We have served as the Company's auditor since 2000. 
 
 
 
 
 
 
 
 
 76 

 
 Table of Contents 

 TFS FINANCIAL CORPORATION AND SUBSIDIARIES 
 
 CONSOLIDATED STATEMENTS OF CONDITION 
 As of September 30, 2025 and 2024 
 (In thousands, except share data) 
 
 
 2025 2024 
 ASSETS 
 Cash and due from banks $ 24,176 $ 26,287 
 Other interest-earning cash equivalents 405,263 437,431 
 Cash and cash equivalents 429,439 463,718 
 Investment securities available for sale (amortized cost $ 542,197 and $ 553,559 , respectively) 
 520,659 526,251 
 Mortgage loans held for sale ($ 22,861 and $ 10,713 measured at fair value, respectively) 
 57,662 17,775 
 Loans held for investment, net: 
 Mortgage loans 15,659,460 15,321,400 
 Other loans 8,153 5,705 
 Deferred loan expenses, net 69,943 64,956 
 Allowance for credit losses on loans ( 74,244 ) ( 70,002 ) 
 Loans, net 15,663,312 15,322,059 
 Mortgage loan servicing assets, net 8,549 7,627 
 Federal Home Loan Bank stock, at cost 235,363 228,494 
 Real estate owned, net 1,921 174 
 Premises, equipment, and software, net 40,022 33,187 
 Accrued interest receivable 62,553 59,398 
 Bank owned life insurance contracts 325,149 317,977 
 Other assets 111,687 114,125 
 TOTAL ASSETS $ 17,456,316 $ 17,090,785 
 LIABILITIES AND SHAREHOLDERS’ EQUITY 
 Deposits $ 10,446,968 $ 10,195,079 
 Borrowed funds 4,870,219 4,792,847 
 Borrowers’ advances for insurance and taxes 113,168 113,637 
 Principal, interest, and related escrow owed on loans serviced 30,328 28,753 
 Accrued expenses and other liabilities 101,709 97,845 
 Total liabilities 15,562,392 15,228,161 
 Commitments and contingent liabilities 
 Preferred stock, $ 0.01 par value, 100,000,000 shares authorized, none issued and outstanding 
 — — 
 Common stock, $ 0.01 par value, 700,000,000 shares authorized; 332,318,750 shares issued; 280,590,497 and 280,710,854 outstanding at September 30, 2025 and September 30, 2024, respectively 
 3,323 3,323 
 Paid-in capital 1,757,813 1,754,365 
 Treasury stock, at cost; 51,728,253 and 51,607,896 shares at September 30, 2025 and September 30, 2024, respectively 
 ( 774,340 ) ( 772,195 ) 
 Unallocated ESOP shares ( 18,417 ) ( 22,750 ) 
 Retained earnings—substantially restricted 946,776 915,489 
 Accumulated other comprehensive income (loss) ( 21,231 ) ( 15,608 ) 
 Total shareholders’ equity 1,893,924 1,862,624 
 TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY $ 17,456,316 $ 17,090,785 

 See accompanying notes to consolidated financial statements. 
 77 

 
 Table of Contents 

 TFS FINANCIAL CORPORATION AND SUBSIDIARIES 
 CONSOLIDATED STATEMENTS OF INCOME 
 For each of the three years in the period ended September 30, 2025 
 (In thousands, except share and per share data) 
 
 
 2025 2024 2023 
 INTEREST AND DIVIDEND INCOME: 
 Loans, including fees $ 706,483 $ 663,685 $ 565,610 
 Investment securities available for sale 18,734 18,228 14,370 
 
 Other interest and dividend earning assets 37,963 52,161 31,939 
 Total interest and dividend income 763,180 734,074 611,919 
 INTEREST EXPENSE: 
 Deposits 308,760 292,728 174,201 
 Borrowed funds 161,726 162,888 154,151 
 Total interest expense 470,486 455,616 328,352 
 NET INTEREST INCOME 292,694 278,458 283,567 
 PROVISION (RELEASE) FOR CREDIT LOSSES 2,500 ( 1,500 ) ( 1,500 ) 
 NET INTEREST INCOME AFTER PROVISION (RELEASE) FOR CREDIT LOSSES 290,194 279,958 285,067 
 NON-INTEREST INCOME: 
 Fees and service charges, net of amortization 9,529 8,069 7,840 
 Net gain on the sale of loans 5,342 2,747 498 
 Increase in and death benefits from bank owned life insurance contracts 10,745 9,999 9,355 
 
 Other 3,164 3,887 3,736 
 Total non-interest income 28,780 24,702 21,429 
 NON-INTEREST EXPENSE: 
 Salaries and employee benefits 109,502 107,782 112,785 
 Marketing services 18,633 19,731 25,288 
 Office property, equipment, and software 29,350 28,314 27,734 
 Federal insurance premium and assessments 14,165 14,571 13,452 
 State franchise tax 4,567 4,744 4,891 
 Other expenses 28,042 29,205 28,979 
 Total non-interest expense 204,259 204,347 213,129 
 INCOME BEFORE INCOME TAXES 114,715 100,313 93,367 
 INCOME TAX EXPENSE 23,756 20,725 18,117 
 NET INCOME $ 90,959 $ 79,588 $ 75,250 
 
 Earnings per share 
 Basic $ 0.32 $ 0.28 $ 0.27 
 Diluted $ 0.32 $ 0.28 $ 0.26 
 
 Weighted average shares outstanding 
 Basic 278,715,769 278,178,496 277,436,382 
 Diluted 279,758,525 279,143,524 278,583,454 

 See accompanying notes to consolidated financial statements. 
 
 
 78 

 
 Table of Contents 

 TFS FINANCIAL CORPORATION AND SUBSIDIARIES 
 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) 
 For each of the three years in the period ended September 30, 2025 
 (In thousands) 
 
 2025 2024 2023 
 Net income $ 90,959 $ 79,588 $ 75,250 
 Other comprehensive income (loss), net of tax: 
 Net change in unrealized (losses) gains on securities available for sale 4,469 20,114 ( 7,274 ) 
 Net change in cash flow hedges ( 9,918 ) ( 126,646 ) 66,649 
 Net change in defined benefit plan obligation ( 174 ) 5,712 2,688 
 Total other comprehensive income (loss) ( 5,623 ) ( 100,820 ) 62,063 
 Total comprehensive income (loss) 
 $ 85,336 $ ( 21,232 ) $ 137,313 

 
 
 See accompanying notes to consolidated financial statements. 
 
 
 79 

 
 Table of Contents 

 TFS FINANCIAL CORPORATION AND SUBSIDIARIES 
 CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY 
 For each of the three years in the period ended September 30, 2025 
 (In thousands, except share and per share data) 
 
 Common
stock Paid-in
capital Treasury
stock Unallocated
common stock
held by ESOP Retained
earnings Accumulated other
comprehensive income (loss) Total
shareholders'equity 
 Balance at September 30, 2022 $ 3,323 $ 1,751,223 $ ( 771,986 ) $ ( 31,417 ) $ 870,047 $ 23,149 $ 1,844,339 
 Comprehensive income 
 
 Net income — — — — 75,250 — 75,250 
 Other comprehensive income net of tax — — — — — 62,063 62,063 
 ESOP shares allocated or committed to be released — 1,427 — 4,333 — — 5,760 
 Compensation costs for equity incentive plans — 4,240 — — — — 4,240 
 Purchase of treasury stock ( 361,869 shares) 
 — — ( 5,000 ) — — — ( 5,000 ) 
 Share-based compensation activity 
 — ( 1,863 ) 885 — — — ( 978 ) 
 Dividends declared to common shareholders ($ 1.13 per common share) 
 — — — — ( 58,313 ) — ( 58,313 ) 
 Balance at September 30, 2023 3,323 1,755,027 ( 776,101 ) ( 27,084 ) 886,984 85,212 1,927,361 
 Comprehensive income 
 Cumulative effect from changes in 
 accounting principle, net of tax 1 
 — — — — 7,898 — 7,898 
 Net income — — — — 79,588 — 79,588 
 Other comprehensive income, net of tax — — — — — ( 100,820 ) ( 100,820 ) 
 ESOP shares allocated or committed to be released — 1,294 — 4,334 — — 5,628 
 Compensation costs for equity incentive plans — 3,875 — — — — 3,875 
 
 Share-based compensation activity 
 — ( 5,831 ) 3,906 — — — ( 1,925 ) 
 Dividends declared to common shareholders ($ 1.13 per common share) 
 — — — — ( 58,981 ) — ( 58,981 ) 
 Balance at September 30, 2024 3,323 1,754,365 ( 772,195 ) ( 22,750 ) 915,489 ( 15,608 ) 1,862,624 
 Comprehensive income 
 
 Net income — — — — 90,959 — 90,959 
 Other comprehensive income, net of tax — — — — — ( 5,623 ) ( 5,623 ) 
 ESOP shares allocated or committed to be released — 1,334 — 4,333 — — 5,667 
 Compensation costs for equity incentive plans — 3,979 — — — — 3,979 
 Purchase of treasury stock ( 247,865 shares) 
 — — ( 3,234 ) — — — ( 3,234 ) 
 Share-based compensation activity 
 — ( 1,865 ) 1,089 — — — ( 776 ) 
 Dividends declared to common shareholders ($ 1.13 per common share) 
 — — — — ( 59,672 ) — ( 59,672 ) 
 Balance at September 30, 2025 $ 3,323 $ 1,757,813 $ ( 774,340 ) $ ( 18,417 ) $ 946,776 $ ( 21,231 ) $ 1,893,924 

 1 Related to ASU 2022-02 adopted November 2, 2023 based on September 30, 2023 data. 
 See accompanying notes to consolidated financial statements. 
 80 

 
 Table of Contents 

 TFS FINANCIAL CORPORATION AND SUBSIDIARIES 
 CONSOLIDATED STATEMENTS OF CASH FLOWS 
 For each of the three years in the period ended September 30, 2025 
 
 2025 2024 2023 
 CASH FLOWS FROM OPERATING ACTIVITIES: (In thousands) 
 Net income $ 90,959 $ 79,588 $ 75,250 
 Adjustments to reconcile net income to net cash provided by operating activities: 
 ESOP and stock-based compensation expense 9,646 9,503 10,000 
 Depreciation and amortization 23,048 19,034 18,115 
 Deferred income taxes 1,352 2,702 3,732 
 Provision (release) for credit losses 2,500 ( 1,500 ) ( 1,500 ) 
 Net gain on the sale of loans ( 5,342 ) ( 2,747 ) ( 498 ) 
 
 Other net (gains) losses ( 19 ) 365 ( 199 ) 
 Proceeds from sales of loans held for sale 116,226 114,665 43,124 
 Loans originated, acquired and principal repayments on loans held for sale ( 133,102 ) ( 131,920 ) ( 45,082 ) 
 Increase in bank owned life insurance contracts ( 10,663 ) ( 9,949 ) ( 9,355 ) 
 Net decrease (increase) in interest receivable and other assets 1,039 ( 4,304 ) ( 39,360 ) 
 Net (decrease) increase in accrued expenses and other liabilities ( 13,225 ) 13,163 36,495 
 
 Net cash provided by operating activities 82,419 88,600 90,722 
 CASH FLOWS FROM INVESTING ACTIVITIES: 
 Loans originated or acquired ( 3,786,379 ) ( 2,991,733 ) ( 3,549,306 ) 
 Principal repayments on loans 3,122,822 2,711,908 2,605,262 
 Proceeds from sales, principal repayments and maturities of: 
 Securities available for sale 170,342 141,716 83,567 
 Proceeds from sale of: 
 Loans 284,777 126,182 33,635 
 Real estate owned 193 1,150 484 
 FHLB stock 
 24,582 53,119 — 
 
 Purchases of: 
 
 FHLB stock ( 31,451 ) ( 34,515 ) ( 34,808 ) 
 Securities available for sale ( 160,342 ) ( 133,525 ) ( 144,663 ) 
 Premises, equipment, and software 
 ( 11,453 ) ( 3,064 ) ( 5,101 ) 
 Other 2,927 4,053 2,299 
 Net cash used in investing activities ( 383,982 ) ( 124,709 ) ( 1,008,631 ) 
 CASH FLOWS FROM FINANCING ACTIVITIES: 
 Net increase in deposits 260,619 732,330 520,029 
 Net (decrease) increase in borrowers' advances for insurance and taxes ( 469 ) ( 10,780 ) 7,167 
 Net increase (decrease) in principal and interest owed on loans serviced 1,575 ( 1,058 ) ( 101 ) 
 Net increase (decrease) in short-term borrowed funds 283,000 ( 777,000 ) 417,000 
 Proceeds (repayments) from Fed Funds purchased — — ( 225,000 ) 
 Proceeds from long-term borrowed funds 225,000 725,000 350,000 
 Repayment of long-term borrowed funds ( 427,000 ) ( 427,322 ) ( 77,876 ) 
 Cash collateral/settlements (provided to) received from derivative counterparties 
 ( 11,931 ) ( 147,211 ) 88,144 
 Acquisition or net settlement of treasury shares 
 ( 3,977 ) ( 1,925 ) ( 5,978 ) 
 
 Dividends paid to common shareholders ( 59,533 ) ( 58,953 ) ( 58,294 ) 
 Net cash provided by financing activities 267,284 33,081 1,015,091 
 NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS ( 34,279 ) ( 3,028 ) 97,182 
 CASH AND CASH EQUIVALENTS—Beginning of year 463,718 466,746 369,564 
 CASH AND CASH EQUIVALENTS—End of year $ 429,439 $ 463,718 $ 466,746 
 SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: 
 Cash paid for interest on deposits $ 324,096 $ 295,985 $ 169,153 
 Cash paid for interest on borrowed funds 204,985 236,629 194,601 
 Cash (received)/ paid for interest on interest rate swaps 
 ( 52,027 ) ( 89,418 ) ( 50,416 ) 
 Cash paid for income taxes 16,480 15,681 21,776 
 SUPPLEMENTAL SCHEDULES OF NONCASH INVESTING AND FINANCING ACTIVITIES: 
 Transfer of loans to real estate owned 1,921 247 869 
 Transfer of loans from held for investment to held for sale 308,595 130,221 33,543 
 Transfer of loans from held for sale to held for investment 4,574 8,525 8,433 
 Treasury stock issued for stock benefit plans 1,865 5,831 1,863 

 See accompanying notes to consolidated financial statements. 
 81 

 
 Table of Contents 

 TFS FINANCIAL CORPORATION AND SUBSIDIARIES 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
 As of and for the years ended September 30, 2025, 2024, and 2023 
 (Dollars in thousands unless otherwise indicated) 
 
 
 
 1. DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 
 Business —TFS Financial Corporation, a federally chartered stock holding company, conducts its principal activities through its wholly owned subsidiaries. The principal line of business of the Company is retail consumer banking, including mortgage lending, deposit gathering, and other financial services. Third Federal Savings and Loan Association of Cleveland, MHC, its federally chartered mutual holding company parent, owned 80.94 % of the outstanding shares of common stock of the Company at September 30, 2025. 
 The Company’s primary operating subsidiaries include the Association and Third Capital, Inc. The Association is a federal savings association which provides retail loan and savings products to its customers in Ohio and Florida through its 36 full-service branches, two loan production offices, customer service call center and internet site. The Association also provides savings products, purchase mortgages, first mortgage refinance loans, home equity lines of credit, and home equity loans in states outside of its branch footprint. The Association also acquires first mortgage loans through a correspondent lending partnership. Third Capital, Inc. was formed to hold non-thrift investments and subsidiaries. 
 The accounting and reporting policies of TFS Financial Corporation and its subsidiaries conform to accounting principles generally accepted in the United States of America and to general practices within the banking industry. 
 No material subsequent events have occurred requiring recognition in the consolidated financial statements or disclosure in the notes to the consolidated financial statements. 
 The following is a description of the significant accounting and reporting policies which the Company follows in preparing and presenting its consolidated financial statements. 
 Basis of Consolidation and Reporting —The consolidated financial statements of the Company include the accounts of TFS Financial Corporation and its wholly owned subsidiaries. Intercompany balances and transactions have been eliminated in consolidation. 
 Estimates —The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. 
 Cash and Cash Equivalents —Cash and cash equivalents consist of working cash on hand, and demand and interest-bearing deposits at other financial institutions with maturities of three months or less. For purposes of reporting cash flows, cash and cash equivalents also includes federal funds sold, when applicable. The Company has acknowledged informal agreements with banks where it maintains deposits. Under these agreements, service fees charged to the Company are waived provided certain average compensating balances are maintained throughout each month. 
 Investment Securities —The Company's fixed-maturity securities are accounted for on an available-for-sale basis. Securities held as available-for-sale are reported at fair value, with the corresponding unrealized gains and (losses), net of deferred income taxes, reported in AOCI. Management determines the appropriate classification of investment securities based on its intent and ability to hold at the time of purchase. Purchases of securities are accounted for on a trade-date or settlement-date basis, depending on the settlement terms. 
 Realized gains and (losses) on securities are computed on a specific identification basis. Realized gains and (losses) also include changes in fair value on derivatives not designated as hedging instruments. Sales of securities are accounted for on a trade-date or settlement-date basis, depending on the settlement terms. 
 A decline in the fair value of any available for sale security, below cost, is evaluated for credit loss. Credit loss is recognized in earnings if management intends, or will more likely than not be required, to sell the security before the recovery of its amortized cost basis. If the present value of cash flows expected to be collected is less than the amortized cost basis of the security, then a credit loss exists and an allowance would be recognized as a credit loss expense, limited to the difference between fair value and amortized cost. Non-credit related loss is recognized in OCI, net of applicable deferred income taxes. 
 To determine whether a credit loss exists, the Company considers, among other things, adverse conditions related to the security, industry, geographic area, the payment schedule of the debt security and likelihood that the issuer will be able to make 
 82 

 Table of Contents 

 payments that increase in the future, failure of the issuer to make scheduled payments and all available information relevant to the securities collectability, changes in ratings assigned by a rating agency, and other credit enhancements that affect the securities expected performance. 
 Investment income consists of interest and accretion (net of amortization). Interest is recognized on an accrual basis using the level-yield method. Premiums and discounts are amortized using the level-yield method. 
 Derivative Instruments —Derivative instruments are carried at fair value in the Company's financial statements. For derivative instruments that are designated and qualify as cash flow hedges, changes in the fair value of the derivative instrument are reported as a component of OCI, net of tax, and reclassified into earnings in the same period during which the hedged transaction affects earnings. The earnings effect of the hedging instrument will be presented in the same income statement line item as the earnings effect of the hedged item. AOCI will be adjusted to a balance that reflects the cumulative change in the fair value of the hedging instrument. At the inception of a hedge, the Company documents certain items, including the relationship between the hedging instrument and the hedged item, the risk management objective and the nature of the risk being hedged, a description of how effectiveness will be measured, an evaluation of hedge transaction effectiveness and the benchmark interest rate or contractually specified interest rate being hedged. 
 Hedge accounting is discontinued prospectively when (1) a derivative is no longer highly effective in offsetting changes in the fair value or cash flow of a hedged item, (2) a derivative expires or is sold, (3) a derivative is de-designated as a hedge because it is unlikely that a forecasted transaction will occur, or (4) it is determined that designation of a derivative as a hedge is no longer appropriate. When hedge accounting is discontinued, the Company would continue to carry the derivative on the statement of condition at its fair value; however, changes in its fair value would be recorded in earnings instead of through OCI. 
 For derivative instruments not designated as hedging instruments, the Company recognizes gains and (losses) on the derivative instrument in current earnings during the period of change. 
 Mortgage Banking Activity —Mortgage loans originated or acquired and intended for sale in the secondary market are carried at the lower of cost or estimated fair value in the aggregate. Mortgage loans included in pending agency contracts to sell and securitize loans are carried at fair value. Fair value is based on quoted secondary market pricing for loan portfolios with similar characteristics and includes consideration of deferred fees (costs). Net unrealized gains or losses on loans carried at fair value are recognized in a valuation allowance by charges to income. 
 The Company generally retains servicing on loans that are sold and initially recognizes an asset for mortgage loan servicing rights based on the fair value of the servicing rights. Residential mortgage loans represent the single class of servicing rights and are measured at the lower of cost or fair value on a recurring basis. Mortgage loan servicing rights are reported net of accumulated amortization, which is recorded in proportion to, and over the period of, estimated net servicing revenues. The Company monitors prepayments and changes amortization of mortgage servicing rights accordingly. Fair values are estimated using discounted cash flows based on current interest rates and prepayment assumptions, and impairment is monitored each quarterly reporting period. The impairment analysis is based on predominant risk characteristics of the loans serviced, such as type, fixed- and adjustable-rate loans, original terms and interest rates. The amount of impairment recognized is the amount by which the mortgage loan servicing assets exceed their fair value. 
 Servicing fee income net of amortization and other loan fees collected on loans serviced for others are included in Fees and service charges, net of amortization on the CONSOLIDATED STATEMENTS OF INCOME . 
 Loans and Related Deferred Loan Expenses, net —Loans originated or acquired with the intent to hold into the foreseeable future are carried at unpaid principal balances adjusted for partial charge-offs, the allowance for credit losses and net deferred loan expenses. Interest on loans is accrued and credited to income as earned. Interest on loans is not recognized in income when collectability is uncertain. 
 Loan fees and certain direct loan origination costs are deferred and recognized as an adjustment to interest income using the level-yield method over the contractual lives of related mortgage loans, if the loans are held for investment. If the loans are held for sale, net deferred fees (costs) are generally not amortized, but rather are recognized when the related loans are sold. Equity lines of credit amortize net deferred fees (costs) on a straight-line basis generally over the draw period. 
 A modification granted to a borrower experiencing financial difficulty is defined as an agreement in which, for economic reasons related to a borrower’s financial difficulties, a more than insignificant concession is granted to the borrower that would not otherwise be available. The modifications to the payment terms of a loan may include interest rate reductions, term extensions, significant payment delays, other concessions, or a combination thereof. 
 Allowance for Credit Losses —The allowance for credit losses represents the estimate of lifetime losses in the Company's loan portfolio and off-balance sheet commitments. The allowance for credit losses is assessed on a quarterly basis and 
 83 

 Table of Contents 

 provisions (releases) for credit losses are made accordingly. The allowance is established using relevant available information, relating to past events, current conditions and supportable economic forecasts. Historical credit loss experience provides the basis for the estimation of expected credit losses. Qualitative adjustments to historical loss information are made for differences in current loan-specific risk characteristics such as differences in underwriting standards, portfolio mix, delinquency status or likely recovery of previous loan charge-offs. The allowance for credit losses is increased by recoveries and decreased by charge-offs. Also, qualitative adjustments include expected recovery of loan amounts previously charged-off, beyond what the model is able to project. 
 For further discussion on the allowance for credit losses, non-accrual, and modifications, see Note 5. LOANS AND ALLOWANCE FOR CREDIT LOSSES and Note 15. COMMITMENTS AND CONTINGENT LIABILITIES of the NOTES TO CONSOLIDATED FINANCIAL STATEMENTS . 
 Real Estate Owned, net —Real estate owned, net represents real estate acquired through foreclosure or deed in lieu of foreclosure and is initially recorded at fair value, less estimated costs to sell. Subsequent to acquisition, real estate owned is carried at the lower of cost or fair value, less estimated selling costs. Management performs periodic valuations and a valuation allowance is established by a charge to income for any excess of the carrying value over the fair value, less estimated costs to sell the property. Recoveries in fair value during the holding period are recognized until the valuation allowance is reduced to zero. Costs related to holding and maintaining the property are charged to expense. 
 Premises, Equipment, and Software, net —Depreciation and amortization of premises, equipment and software is computed on a straight-line basis over the estimated useful lives of the related assets. Estimated lives are 31.5 years for office facilities and three to 10 years for equipment and software. Amortization of leasehold or building improvements is computed on a straight-line basis over the lesser of the economic useful life of the improvement or term of the lease, typically 10 years. 
 Leases —At inception, all contracts are evaluated to determine if the arrangement contains a lease based on the terms and conditions. As a lessee, the Company recognizes leases with terms greater than one year on the CONSOLIDATED STATEMENTS OF CONDITION as lease assets (a right-of-use asset) and lease liabilities (a liability to make lease payments), measured on a discounted basis. For further discussion on leases, see Note 8. LEASES . 
 Bank Owned Life Insurance Contracts —Life insurance is provided under both whole and split dollar life insurance agreements. Policy premiums were prepaid and the Company will recover the premiums paid from the proceeds of the policies. The Company recognizes death benefits and growth in the cash surrender value of the policies in other non-interest income. 
 Goodwill —The excess of purchase price over the fair value of net assets of acquired companies is classified as goodwill and reported in Other Assets. Goodwill was $ 9,732 at September 30, 2025 and 2024. Goodwill is reviewed for impairment on an annual basis as of September 30. No impairment was identified as of September 30, 2025 or 2024. 
 Taxes on Income —Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Additional information about policies related to income taxes is included in Note 12. INCOME TAXES . 
 Deposits —Interest on deposits is accrued and charged to expense monthly and is paid or credited in accordance with the terms of the accounts. 
 Treasury Stock— Acquisitions of treasury stock through stock repurchases are recorded at cost using the cost method of accounting. Repurchases may be made through open market purchases, block trades and in negotiated private transactions, subject to the availability of stock, general market conditions, the trading price of the stock, alternative uses for capital, and the Company’s financial performance. Repurchased shares will be available for general corporate purposes. 
 Accumulated Other Comprehensive Income (Loss) —AOCI consists of changes in pension obligations, changes in unrealized gains (losses) on securities available for sale and cash flow hedges, each of which is net of the related income tax effects. The Company's policy is to release income tax effects from AOCI only when the entire portfolio to which the underlying transactions relate to is liquidated, sold or extinguished. 
 Revenue from Contracts with Customers —The core principle of ASC 606 requires an entity to recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to receive in exchange for those goods or services. Three of the Company's revenue streams within scope of Topic 
 84 

 Table of Contents 

 606 are the sales of REO, interchange income, and deposit account and other transaction-based service fee income. Those streams are immaterial and therefore quantitative information regarding these streams is not disclosed. 
 Pension Benefits —The determination of the Company's obligations and expense for pension benefits is dependent upon certain assumptions used in calculating such amounts. Key assumptions used in the actuarial valuations include the discount rate and expected long-term rate of return on plan assets. Actual results could differ from the assumptions and market driven rates may fluctuate. Significant differences in actual experience or significant changes in the assumptions could materially affect future pension obligations and expense. 
 Share-Based Compensation —Compensation expense for awards of equity instruments is recognized on a straight-line basis over the requisite service period based on the grant date fair value estimated in accordance with the provisions of FASB ASC 718 “Compensation—Stock Compensation.” All vested equity instruments are settled in stock. Forfeitures are recognized as they occur. Share-based compensation expense is included in Salaries and employee benefits in the CONSOLIDATED STATEMENTS OF INCOME . Tax benefits or deficiencies recognized for the difference between realized deductions and cumulative book compensation cost on share-based compensation awards are included in operating cash flows on the CONSOLIDATED STATEMENTS OF CASH FLOW . 
 The grant date fair value of stock options is estimated using the Black-Scholes option-pricing model using assumptions for the expected option term, expected stock price volatility, risk-free interest rate, and expected dividend yield. The simplified method is used to estimate expected term of "plain vanilla" options when the Company's historical experience does not provide a reasonable basis for the estimate. 
 Marketing Costs —Marketing costs are expensed as incurred. 
 Earnings per Share —Basic EPS is computed by dividing net income by the weighted-average number of shares of common stock outstanding. Outstanding shares include shares sold to subscribers, shares held by the Third Federal Foundation, shares of the Employee Stock Ownership Plan which have been allocated or committed to be released for allocation to participants, and shares held by Third Federal Savings, MHC. Unvested shares awarded in the Company's share-based compensation plan are treated as participating securities for purposes of the two-class method when they contain non-forfeitable rights to dividends, but are not included in the number of shares in the computation of basic EPS. The two-class method is an earnings allocation that determines EPS for each class of common stock and participating security. 
 Diluted EPS is computed using the same method as basic EPS, but the weighted-average number of shares reflects the potential dilution, if any, of unexercised stock options, unvested shares of performance share units and unvested shares of restricted stock units that could occur if stock options were exercised and performance share units and restricted stock units were issued and converted into common stock. These potentially dilutive shares would then be included in the number of weighted-average shares outstanding for the period using the treasury stock method. At September 30, 2025, 2024 and 2023, potentially dilutive shares include stock options, restricted stock units and performance share units issued through share-based compensation plans. 
 Segment Reporting —The Company operates as a single reportable segment that derives revenues primarily by providing residential mortgage loans and deposit products to customers in the United States. 
 The Company's CODM is the CEO, who regularly assesses performance on a consolidated basis and decides how to allocate resources based on net income as reported in the Company's CONSOLIDATED STATEMENTS OF INCOME. The CODM uses net income to evaluate income generated from segment assets (return on assets), compare performance to peer banks and monitor budget-to-actual results. The CODM is also regularly provided with and reviews expense information at a level consistent with that disclosed in the Company's consolidated financial statements, including its significant expense categories: interest expense, provisions for credit losses, salaries and employee benefits and marketing expense. 
 As the Company consists of one reportable segment, the segment assets are reflected on the CONSOLIDATED STATEMENTS OF CONDITION as "total assets" and the noted significant segment expenses are listed on the CONSOLIDATED STATEMENTS OF INCOME. The Accounting policies for the segment are the same as those described in this Note 1. 
 Reclassification —Certain prior year amounts have been reclassified to conform with the current year presentation. These reclassifications had no effect on the financial position or reported results of operations. 
 
 
 85 

 
 Table of Contents 

 2. STOCK TRANSACTIONS 
 TFS Financial Corporation completed its initial public stock offering on April 20, 2007 and sold 100,199,618 shares, or 30.16 % of its post-offering outstanding common stock, to subscribers in the offering. Third Federal Savings, MHC, the Company’s mutual holding company parent, holds 227,119,132 shares of TFS Financial Corporation’s outstanding common stock. TFS Financial Corporation issued 5,000,000 shares of common stock, or 1.50 % of its post-offering outstanding common stock, to Third Federal Foundation. 
 Pursuant to the eighth repurchase program for the repurchase of 10,000,000 shares authorized by the Board of Directors in October 2016, 247,865 shares were repurchased during the year ended September 30, 2025, no shares were repurchased during the year ended September 30, 2024, and 361,869 shares were repurchased during the year ended September 30, 2023. At September 30, 2025, there were 4,944,086 shares remaining to be purchased under the eighth repurchase program. The Company previously repurchased 51,300,000 shares of the Company’s common stock as part of the previous seven Board of Directors-approved share repurchase programs. In total, the Company has repurchased 56,355,914 shares of the Company's common stock as of September 30, 2025. 
 
 
 
 3. REGULATORY MATTERS 
 The Association is subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the financial statements of the Association. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Association must meet specific capital guidelines that involve quantitative measures of its assets, liabilities, and certain off-balance-sheet items as calculated under regulatory accounting practices. The capital amounts and classifications are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. 
 Quantitative measures established by regulation to ensure capital adequacy require the Association to maintain minimum amounts and ratios (set forth in table below) of Common Equity Tier 1, Tier 1, and Total Capital (as defined in the regulations) to Risk-Weighted Assets (as defined) and Tier 1 Capital (as defined) to Net Average Assets (as defined). The risk-based capital guidelines include both a definition of capital and a framework for calculating risk-weighted assets by assigning balance sheet assets and off-balance sheet assets to broad risk categories. 
 At September 30, 2025 , the Association exceeded all regulatory capital requirements and is considered “well capita lized” under regulatory guidelines. 
 The Association operates under the capital requirements for the standardized approach of the Basel III capital framework for U.S. banking organizations (“Basel III Rules”), which limits capital distributions and certain discretionary bonus payments to management if the institution does not hold a "capital conservation buffer" consisting of 2.5% in addition to the minimum capital requirements. At September 30, 2025, the Association exceeded the fully phased-in regulatory requirement for the "capital conservation buffer." 
 86 

 Table of Contents 

 The following table summarizes the actual capital amounts and ratios of the Association as of September 30, 2025 and 2024, compared to the minimum capital adequacy requirements and the requirements for classification as a well capitalized institution. 
 
 Minimum Requirements 
 Actual For Capital
Adequacy Purposes To be “Well Capitalized”
Under Prompt Corrective
Action Provision 
 Amount Ratio Amount Ratio Amount Ratio 
 September 30, 2025 
 Total Capital to Risk-Weighted Assets $ 1,852,378 17.40 % $ 851,709 8.00 % $ 1,064,637 10.00 % 
 Tier 1 (Leverage) Capital to Net Average Assets 1,759,983 10.11 % 696,354 4.00 % 870,442 5.00 % 
 Tier 1 Capital to Risk-Weighted Assets 1,759,983 16.53 % 638,782 6.00 % 851,709 8.00 % 
 Common Equity Tier 1 Capital to Risk-Weighted Assets
 1,759,983 16.53 % 479,086 4.50 % 692,014 6.50 % 
 September 30, 2024 
 Total Capital to Risk-Weighted Assets $ 1,795,509 17.91 % $ 802,146 8.00 % $ 1,002,682 10.00 % 
 Tier 1 (Leverage) Capital to Net Average Assets 1,721,625 10.11 % 681,298 4.00 % 851,623 5.00 % 
 Tier 1 Capital to Risk-Weighted Assets 1,721,625 17.17 % 601,609 6.00 % 802,146 8.00 % 
 Common Equity Tier 1 Capital to Risk-Weighted Assets
 1,721,625 17.17 % 451,207 4.50 % 651,744 6.50 % 

 The Association paid dividends of $ 40.0 million and $ 0 to the Company during the fiscal years ended September 30, 2025 and 2024, respectively. 
 As permitted under interim final rules issued by the FRS on August 12, 2011, a majority of Third Federal Savings, MHC's members eligible to vote approved Third Federal Savings, MHC waiving dividends aggregating up to $1.13 per share on the common stock of the Company for the 12 months following the special meeting of members held on July 8, 2025. Unless the FRS amends its interim rule, a member vote will be required for Third Federal Savings, MHC to waive its right to receive dividends beyond July 8, 2026. 
 
 
 
 4. INVESTMENT SECURITIES 
 Available-for-sale securities are summarized in the tables below. 
 
 September 30, 2025 
 Amortized
Cost Gross
Unrealized Fair
Value 
 Gains Losses 
 REMICs $ 477,058 $ 2,028 $ ( 23,718 ) $ 455,368 
 Fannie Mae certificates 2,624 98 ( 3 ) 2,719 
 Freddie Mac certificates 8,474 162 ( 19 ) 8,617 
 U.S. Government and agency obligations 54,041 4 ( 90 ) 53,955 
 Total $ 542,197 $ 2,292 $ ( 23,830 ) $ 520,659 

 
 
 
 September 30, 2024 
 Amortized
Cost Gross
Unrealized Fair
Value 
 Gains Losses 
 REMICs $ 476,680 $ 1,202 $ ( 28,481 ) $ 449,401 
 Fannie Mae certificates 2,810 137 ( 2 ) 2,945 
 Freddie Mac certificates 
 1,138 — ( 9 ) 1,129 
 U.S. Government and agency obligations 72,931 29 ( 184 ) 72,776 
 Total $ 553,559 $ 1,368 $ ( 28,676 ) $ 526,251 

 87 

 Table of Contents 

 At September 30, 2025 and September 30, 2024, investment securities included $ 50,032 and $ 68,932 , respectively, of U.S. government obligations pledged as collateral on the Company's open swap positions to meet requirements established by the clearing organization. Accrued interest on investment securities is $ 2,556 and $ 2,399 at September 30, 2025, and September 30, 2024, respectively, and is reported in accrued interest receivable on the CONSOLIDATED STATEMENTS OF CONDITION . 
 The following is a summary of the Company's securities portfolio by remaining period to contractual maturity and by weighted average yield at September 30, 2025 and September 30, 2024. Maturities are based on the final contractual payment dates, and do not reflect the impact of prepayments or early redemptions that may occur. Weighted average yields are not presented on a tax-equivalent basis and are calculated by multiplying each carry value by its yield and dividing the sum of these results by the total carry values. We did not hold any tax-free securities at September 30, 2025 or September 30, 2024. 
 
 September 30, 2025 September 30, 2024 
 Amortized Cost Fair Value Weighted Average Yield Amortized Cost Fair Value Weighted Average Yield 
 Due in one year or less $ 54,131 $ 54,045 4.08 % $ 69,192 $ 69,219 5.25 % 
 Due after one to five years 760 759 3.49 % 7,551 7,332 1.87 % 
 Due after five to 10 years 
 35,600 35,344 3.78 % 27,639 27,162 3.22 % 
 10 years or greater 
 451,706 430,511 3.45 % 449,177 422,538 3.16 % 
 Total $ 542,197 $ 520,659 3.54 % $ 553,559 $ 526,251 3.40 % 

 Gross unrealized losses on available- for- sale securities and the estimated fair value of the related securities, aggregated by the length of time the securities have been in a continuous unrealized loss position, at September 30, 2025 and September 30, 2024, were as follows: 
 
 September 30, 2025 
 Less Than 12 Months 12 Months or More Total 
 Estimated
Fair Value Unrealized
Loss Estimated
Fair Value Unrealized
Loss Estimated
Fair Value Unrealized
Loss 
 Available for sale— 
 REMICs $ 18,513 $ 122 $ 269,958 $ 23,596 $ 288,471 $ 23,718 
 Fannie Mae certificates — — 100 3 100 3 
 Freddie Mac certificates — — 1,115 19 1,115 19 
 U.S. Government and agency obligations — — 3,923 90 3,923 90 
 Total $ 18,513 $ 122 $ 275,096 $ 23,708 $ 293,609 $ 23,830 
 

 
 September 30, 2024 
 Less Than 12 Months 12 Months or More Total 
 Estimated
Fair Value Unrealized
Loss Estimated
Fair Value Unrealized
Loss Estimated
Fair Value Unrealized
Loss 
 Available for sale— 
 REMICs $ 9,393 $ 9 $ 325,660 $ 28,472 $ 335,053 $ 28,481 
 Fannie Mae certificates — — 101 2 101 2 
 Freddie Mac certificates 
 — — 1,129 9 1,129 9 
 
 U.S. Government and agency obligations — — 3,844 184 3,844 184 
 Total $ 9,393 $ 9 $ 330,734 $ 28,667 $ 340,127 $ 28,676 

 The unrealized losses on investment securities were primarily attributable to an increase in market interest rates. The investment portfolio is comprised entirely of securities issued by U.S. government entities and agencies, which support the expectation of zero, other than temporary, loss estimates since principal and interest payments due on these securities carry the full faith and credit guaranty of the U.S. government. In addition, the U.S. Treasury Department established financing agreements in 2008 to ensure Fannie Mae and Freddie Mac meet their obligations to holders of mortgage-backed securities that they have issued or guaranteed. 
 88 

 Table of Contents 

 Since the decline in value is primarily attributable to an increase in market interest rates and not credit quality deterioration, and because the Company has neither the intent to sell the securities nor is it more likely than not the Company will be required to sell the securities prior to recovery of the amortized cost, the Company did not record an allowance for credit losses as of September 30, 2025 or September 30, 2024. 
 
 
 
 5. LOANS AND ALLOWANCE FOR CREDIT LOSSES 
 LOAN PORTFOLIOS 
 Loans held for investment consist of the following: 
 
 September 30, 2025 September 30, 2024 
 Real estate loans: 
 Residential Core $ 10,803,813 $ 11,385,142 
 Residential Home Today 35,933 40,936 
 Home equity lines of credit (1) 
 4,062,798 3,323,381 
 Home equity loans (1) 
 749,548 561,926 
 Construction 12,302 21,701 
 Real estate loans 15,664,394 15,333,086 
 Other loans 8,153 5,705 
 Add (deduct): 
 Deferred loan expenses, net 69,943 64,956 
 Loans-in-process ( 4,934 ) ( 11,686 ) 
 Allowance for credit losses on loans ( 74,244 ) ( 70,002 ) 
 Loans held for investment, net $ 15,663,312 $ 15,322,059 

 (1) At and for the year ended September 30, 2025, balances of and activity related to home equity lines of credit and home equity loans are reported as separate line items. Prior periods have been reclassified to conform to the current presentation. 
 Loans held for investment are carried at amortized cost, which includes outstanding principal balance adjusted for any unamortized premiums or discounts, net of deferred fees and expenses and any applicable loans-in-process. Accrued interest is $ 59,980 and $ 56,982 as of September 30, 2025 and September 30, 2024, respectively, and is reported in accrued interest receivable on the CONSOLIDATED STATEMENTS OF CONDITION. 
 A large concentration of the Company’s lending is in Ohio and Florida. At September 30, 2025 and September 30, 2024, the percentage of aggregate Residential Core, Home Today and Construction loans secured by properties in Ohio was 59 % and 58 %, respectively, and the percentage of loans secured by properties in Florida was 17 % as of both dates. At September 30, 2025 and September 30, 2024, home equity lines of credit were concentrated in the states of Ohio ( 22 % and 23 %, respectively), Florida ( 21 % and 22 %, respectively), and California ( 17 % and 16 %, respectively), and home equity loans were concentrated in Ohio ( 23 % and 26 %, respectively), Florida ( 22 % and 25 %, respectively), and California ( 18 % and 19 %, respectively). 
 Residential Core mortgage loans represent the largest portion of the residential real estate portfolio. The Company believes overall credit risk is low based on the nature, composition, collateral, products, lien position and performance of the portfolio. The portfolio does not include loan types or structures that have experienced severe performance problems at other financial institutions (sub-prime, no documentation or pay-option adjustable-rate mortgages). The portfolio contains "Smart Rate" adjustable-rate mortgage loans whereby the interest rate is locked initially for three or five years then resets annually, subject to periodic rate adjustments caps and various re-lock options available to the borrower. Although the borrower is qualified for its loan at a higher rate than the initial rate offered, the adjustable-rate feature may impact a borrower's ability to afford the higher payments upon rate reset during periods of rising interest rates while this repayment risk may be reduced in a declining or low rate environment. With limited historical loss experience compared to other types of loans in the portfolio, judgment is required by management in assessing the allowance required on adjustable-rate mortgage loans. The principal amount of adjustable-rate mortgage loans included in the Residential Core portfolio was $ 3,944,540 and $ 4,379,132 at September 30, 2025 and September 30, 2024, respectively. 
 Home Today was an affordable housing program targeted to benefit low- and moderate-income home buyers. Most loans under the program were originated prior to 2009. No new loans were originated under the Home Today program after 2016. Home Today loans have greater credit risk than traditional residential mortgage loans. 
 89 

 Table of Contents 

 The Company originates construction loans to individuals for the construction of their personal single-family residence by a qualified builder (construction/permanent loans). The Company’s construction/permanent loans generally provide for disbursements to the builder or sub-contractors during the construction phase as work progresses. During the construction phase, the borrower only pays interest on the drawn balance. Upon completion of construction, the loan converts to a permanent amortizing loan without the expense of a second closing. The Company offers construction/permanent loans with fixed or adjustable-rates, and a current maximum loan-to-completed-appraised value ratio of 85 %. 
 Other loans are comprised of loans secured by certificate of deposit accounts, which are fully recoverable in the event of non-payment, and forgivable down payment assistance loans, which are unsecured loans used as down payment assistance to borrowers qualified through partner housing agencies. The Company records a liability for the down payment assistance loans which are forgiven in equal increments over a pre-determined term, subject to residency requirements. 
 Loans held for sale include loans originated or acquired with the intent to sell which are generally priced in alignment with secondary market pricing and may be subject to loan level pricing adjustments. Additionally, loans originated or acquired for the held for investment portfolio may later be identified for sale and transferred to the held for sale portfolio, which may include loans originated or acquired within the parameters of programs established by Fannie Mae. During the years ended September 30, 2025 and September 30, 2024, reclassifications to the held for sale portfolio included loans that were sold during the period, including those in contracts pending settlement at the end of the period, and loans originated for the held for investment portfolio that were later identified for sale. At September 30, 2025 and September 30, 2024, mortgage loans held for sale totaled $ 57,662 and $ 17,775 , respectively. During the years ended September 30, 2025, September 30, 2024 and September 30, 2023, the principal balance of loans sold (including loans in contracts pending settlement when applicable) was $ 411,284 , $ 247,442 , and $ 77,205 , respectively. During the years ended September 30, 2025, September 30, 2024 and September 30, 2023, the amortized cost of loans classified as held for sale that were subsequently transferred to the held for investment portfolio was $ 4,574 , $ 8,525 and $ 8,433 , respectively. 
 DELINQUENCY and NON-ACCRUAL 
 An aging analysis of the amortized cost in loan receivables that are past due at September 30, 2025 and September 30, 2024, is summarized in the following tables. When a loan is more than one month past due on its scheduled payments, the loan is considered 30 days or more past due, regardless of the number of days in each month. 
 
 30-59 Days
Past Due 60-89 Days
Past Due 90 Days
or More
Past Due Total Past
Due Current Total 
 September 30, 2025 
 Real estate loans: 
 Residential Core $ 6,494 $ 2,855 $ 10,470 $ 19,819 $ 10,810,686 $ 10,830,505 
 Residential Home Today 752 266 560 1,578 33,893 35,471 
 Home equity lines of credit 
 4,791 1,382 5,296 11,469 4,089,196 4,100,665 
 Home equity loans 
 511 339 935 1,785 753,705 755,490 
 Construction — — — — 7,272 7,272 
 Total real estate loans 12,548 4,842 17,261 34,651 15,694,752 15,729,403 
 Other loans — — — — 8,153 8,153 
 Total $ 12,548 $ 4,842 $ 17,261 $ 34,651 $ 15,702,905 $ 15,737,556 

 
 
 90 

 Table of Contents 

 
 30-59 Days 
 Past Due 
 60-89 Days Past Due 
 90 Days
or More
Past Due Total Past
Due Current Total 
 September 30, 2024 
 Real estate loans: 
 Residential Core $ 7,554 $ 4,024 $ 8,881 $ 20,459 $ 11,388,395 $ 11,408,854 
 Residential Home Today 814 307 693 1,814 38,657 40,471 
 Home equity lines of credit 
 3,556 1,014 4,078 8,648 3,351,495 3,360,143 
 Home equity loans 
 578 107 282 967 565,906 566,873 
 Construction — — — — 10,015 10,015 
 Total real estate loans 12,502 5,452 13,934 31,888 15,354,468 15,386,356 
 Other loans — — — — 5,705 5,705 
 Total $ 12,502 $ 5,452 $ 13,934 $ 31,888 $ 15,360,173 $ 15,392,061 

 Loans are placed in non-accrual status when they are contractually 90 days or more past due. The number of days past due is determined by the number of scheduled payments that remain unpaid, assuming a period of 30 days between each scheduled payment. Loans with a partial charge-off are placed in non-accrual and will remain in non-accrual status until, at a minimum, the loss is recovered. Loans modified that were in non-accrual status prior to modification and loans with forbearance plans that were subsequently modified, are reported in non-accrual status for a minimum of six months after modification. Loans modified with a high debt-to-income ratio, per the Company's modification policy, at the time of modification are placed in non-accrual status for a minimum of 12 months. Additionally, home equity loans and lines of credit where the customer has a severely delinquent first mortgage loan (greater than 90 days past due) and loans in Chapter 7 bankruptcy status where all borrowers have filed, and not reaffirmed or been dismissed, are placed in non-accrual status. 
 The amortized cost of loan receivables in non-accrual status is summarized in the following table. Non-accrual with no ACL describes non-accrual loans which have no quantitative allowance, primarily because they have already been subject to collateral review and any required charge-offs have been taken, but may be included in consideration of qualitative allowance factors. There are no loans 90 or more days past due and still accruing at September 30, 2025 or September 30, 2024. 
 
 September 30, 2025 September 30, 2024 
 Non-accrual with No ACL Total 
Non-accrual Non-accrual with No ACL Total 
Non-accrual 
 Real estate loans: 
 Residential Core $ 18,861 $ 23,041 $ 18,937 $ 21,058 
 Residential Home Today 2,858 3,032 3,506 3,672 
 Home equity lines of credit 
 10,071 11,141 7,610 8,361 
 Home equity loans 
 1,280 1,492 460 519 
 
 Total non-accrual loans $ 33,070 $ 38,706 $ 30,513 $ 33,610 
 
 

 At September 30, 2025 and September 30, 2024, respectively, the amortized cost in non-accrual loans includes $ 21,458 and $ 19,704 , which are performing according to the terms of their agreement, of which $ 13,843 and $ 11,532 , are loans in Chapter 7 bankruptcy status, primarily where all borrowers have filed, and have not reaffirmed or been dismissed. At September 30, 2025 and September 30, 2024, real estate loans include $ 9,918 and $ 10,527 , respectively, of loans that were in the process of foreclosure. 
 Interest on loans in accrual status is recognized in interest income as it accrues, on a daily basis. Accrued interest on loans in non-accrual status is written off by a charge to interest income and income is subsequently recognized only to the extent cash payments are received. The Company has elected not to measure an allowance for credit losses on accrued interest receivable amounts since amounts are written off timely. Cash payments on loans in non-accrual status are applied to the oldest scheduled, unpaid payment first. The amount of interest income recognized on non-accrual loans was $ 1,045 and $ 750 for the years ended September 30, 2025 and September 30, 2024, respectively. Cash payments on loans with a partial charge-off are applied fully to principal, then to recovery of the charged off amount prior to interest income being recognized, except cash payments may be applied to interest capitalized in a modification when collection of remaining amounts due is considered probable. A non-accrual loan is generally returned to accrual status when contractual payments are less than 90 days past due. However, a loan may remain in non-accrual status when collectability is uncertain, such as a modification that has not met minimum payment requirements, a loan with a partial charge-off, a home equity loan or line of credit with a delinquent first mortgage greater than 
 91 

 Table of Contents 

 90 days past due, or a loan in Chapter 7 bankruptcy status where all borrowers have filed, and have not reaffirmed or been dismissed. 
 ALLOWANCE FOR CREDIT LOSSES 
 The allowance for credit losses represents the estimate of lifetime losses in the loan portfolio and unfunded loan commitments. The allowance is estimated at each reporting date using relevant available information relating to past events, current conditions and reasonable and supportable forecasts. The Company utilizes loan level regression models with forecasted economic data to derive the probability of default and loss given default factors. These factors are used to calculate the loan level credit loss over a 24-month period with an immediate reversion to historical mean loss rates for the remaining life of the loans. 
 Historical credit loss experience provides the basis for the estimation of expected credit losses. Qualitative adjustments to historical loss information are made for differences in current loan-specific risk characteristics such as differences in underwriting standards, portfolio mix, delinquency status or likely recovery of previous loan charge-offs. Qualitative adjustments for expected changes in environmental conditions, such as changes in unemployment rates, property values or other relevant factors, are recognized when forecasted economic data used in the model differs from management's view or contains a significant level of uncertainty. Identifiable model limitations may also lead to qualitative adjustments, such as those made to reflect the expected recovery of loan amounts previously charged-off, beyond what the model is able to project. The qualitative adjustments resulted in a negative ending balance on the allowance for credit losses for the Home Today portfolio, where recoveries are expected to exceed charge-offs over the remaining life of that portfolio. The net qualitative adjustment at September 30, 2025, was a reduction to the allowance for credit losses of $ 1,801 , compared to a reduction of $ 5,519 at September 30, 2024. Qualitative adjustments are evaluated quarterly, at a minimum, based on current facts and circumstances. 
 Partial or full charge-offs are recognized for the amount of credit losses on loans when the borrower is experiencing financial difficulty. Charge-offs are taken when: 
 • For residential mortgage loans, payments are at least 150 days delinquent, but no later than 180 days delinquent; 
 • For home equity loans and lines of credit and modified residential loans, payments are greater than 90 days delinquent; 
 • For all classes of loan modifications with a high debt-to-income ratio at time of modification; 
 • For all classes of loans, a sheriff sale is scheduled within 60 days to sell the collateral securing the loan; 
 • For all classes of loans, all borrowers have been discharged of their obligation through a Chapter 7 bankruptcy; 
 • For all classes of loans, within 60 days of notification, all borrowers obligated on the loan have filed Chapter 7 bankruptcy and have not reaffirmed or been dismissed; 
 • For all classes of loans, a borrower obligated on a loan has filed bankruptcy and the loan is greater than 30 days delinquent; and 
 • For all classes of loans, it becomes evident that a loss is probable. 
 Charge-offs on residential mortgage loans, home equity loans and lines of credit, and construction loans are also recognized when triggering events, such as foreclosure actions, short sales, or deeds accepted in lieu of repayment, result in less than full repayment of the amortized cost in the loans. 
 For all classes of loans, a loan is considered collateral-dependent when, based on current information and events, the borrower is experiencing financial difficulty and repayment is expected to be provided substantially through the sale of the collateral or foreclosure is probable. Factors considered in determining that a loan is collateral-dependent may include the deteriorating financial condition of the borrower, indicated by missed or delinquent payments, or a pending legal action, such as bankruptcy or foreclosure. 
 Collateral-dependent residential mortgage loans and construction loans are charged-off to the extent the amortized cost in the loan, net of anticipated mortgage insurance claims, exceeds the fair value, less estimated costs to dispose of the underlying property. Management can determine if the loan is uncollectible for reasons such as foreclosures exceeding a reasonable time frame and recommend a full charge-off. Home equity loans or lines of credit are charged-off to the extent the amortized cost in the loan plus the balance of any senior liens exceeds the fair value, less estimated costs to dispose of the underlying property, or management determines the collateral is not sufficient to satisfy the loan. A loan in any portfolio identified as collateral-dependent will continue to be reported as such until it is no longer considered collateral-dependent, is less than 30 days past due and does not have a prior charge-off. A loan in any portfolio that has a partial charge-off will continue to be individually evaluated for credit loss until, at a minimum, the loss has been recovered. 
 92 

 Table of Contents 

 Activity in the allowance for credit losses by portfolio segment is summarized as follows. See Note 15. COMMITMENTS AND CONTINGENT LIABILITIES for further details on the allowance for unfunded commitments. 
 
 For the Year Ended September 30, 2025 
 Beginning
Balance Provisions (Releases) Charge-offs Recoveries Ending
Balance 
 Real estate loans: 
 Residential Core $ 44,402 $ ( 5,604 ) $ ( 18 ) $ 1,159 $ 39,939 
 Residential Home Today ( 2,672 ) ( 1,555 ) ( 15 ) 1,804 ( 2,438 ) 
 Home equity lines of credit 
 16,590 4,400 ( 1,064 ) 2,143 22,069 
 Home equity loans 
 11,642 2,965 ( 17 ) 55 14,645 
 Construction 40 ( 11 ) — — 29 
 Total real estate loans
 $ 70,002 $ 195 $ ( 1,114 ) $ 5,161 $ 74,244 
 Total Unfunded Loan Commitments (1) 
 $ 27,811 $ 2,305 $ — $ — $ 30,116 
 Total Allowance for Credit Losses $ 97,813 $ 2,500 $ ( 1,114 ) $ 5,161 $ 104,360 

 (1) For all periods presented, the total allowance for unfunded loan commitments is recognized in accrued expenses and other liabilities on the CONSOLIDATED STATEMENTS OF CONDITION and primarily relates to undrawn home equity lines of credit. 
 
 
 
 For the Year Ended September 30, 2024 
 Beginning
Balance Adoption of ASU 2022-02 Provisions (Releases) Charge-offs Recoveries Ending
Balance 
 Real estate loans: 
 Residential Core $ 55,375 $ ( 5,896 ) $ ( 6,100 ) $ ( 226 ) $ 1,249 $ 44,402 
 Residential Home Today ( 1,236 ) ( 1,896 ) ( 1,533 ) ( 112 ) 2,105 ( 2,672 ) 
 Home equity lines of credit 
 16,086 ( 2,468 ) 1,311 ( 842 ) 2,503 16,590 
 Home equity loans 
 6,961 ( 2 ) 4,635 ( 33 ) 81 11,642 
 Construction 129 — ( 109 ) — 20 40 
 Total real estate loans
 $ 77,315 ( 10,262 ) $ ( 1,796 ) $ ( 1,213 ) $ 5,958 $ 70,002 
 Total Unfunded Loan Commitments (1) 
 $ 27,515 $ — $ 296 $ — $ — $ 27,811 
 Total Allowance for Credit Losses $ 104,830 $ ( 10,262 ) $ ( 1,500 ) $ ( 1,213 ) $ 5,958 $ 97,813 

 (1) For all periods presented, the total allowance for unfunded loan commitments is recognized in accrued expenses and other liabilities on the CONSOLIDATED STATEMENTS OF CONDITION and primarily relates to undrawn home equity lines of credit. 
 
 For the Year Ended September 30, 2023 
 Beginning
Balance Provisions (Releases) Charge-offs Recoveries Ending
Balance 
 Real estate loans: 
 Residential Core $ 53,506 $ 1,000 $ ( 257 ) $ 1,126 $ 55,375 
 Residential Home Today ( 997 ) ( 2,370 ) ( 320 ) 2,451 ( 1,236 ) 
 Home equity lines of credit 
 15,546 ( 2,784 ) ( 649 ) 3,973 16,086 
 Home equity loans 
 4,486 2,385 ( 16 ) 106 6,961 
 Construction 354 ( 225 ) — — 129 
 Total real estate loans
 $ 72,895 $ ( 1,994 ) $ ( 1,242 ) $ 7,656 $ 77,315 
 Total Unfunded Loan Commitments (1) 
 $ 27,021 $ 494 $ — $ — $ 27,515 
 Total Allowance for Credit Losses $ 99,916 $ ( 1,500 ) $ ( 1,242 ) $ 7,656 $ 104,830 

 (1) For all periods presented, the total allowance for unfunded loan commitments is recognized in accrued expenses and other liabilities on the CONSOLIDATED STATEMENTS OF CONDITION and primarily relates to undrawn home equity lines of credit. 
 
 
 
 
 93 

 Table of Contents 

 CLASSIFIED LOANS 
 The following tables provide the amortized cost and information about the credit quality of residential loan receivables by an internally assigned grade as of the dates presented. Revolving loans reported at amortized cost include home equity lines of credit currently in their draw period. Revolving loans converted to term are home equity lines of credit that are in repayment. Loans, or the portions of loans, classified as loss are fully charged-off in the period in which they are determined to be uncollectible; therefore they are not included in the following tables. No Home Today loans are classified Special Mention and all construction loans are classified Pass for both periods presented. 
 
 Revolving Loans Amortized Cost Basis 
 Revolving Loans Converted to Term 
 
 By fiscal year of origination 
 2025 2024 2023 2022 2021 Prior Total 
 September 30, 2025 
 Real estate loans: 
 Residential Core 
 Pass $ 757,380 $ 468,343 $ 1,373,019 $ 2,660,389 $ 1,626,170 $ 3,914,125 $ — $ — $ 10,799,426 
 Special Mention — — — — — 666 — — 666 
 Substandard — 161 2,024 4,000 3,040 21,188 — — 30,413 
 Total Residential Core 757,380 468,504 1,375,043 2,664,389 1,629,210 3,935,979 — — 10,830,505 
 Residential Home Today (1) 
 
 Pass — — — — — 31,936 — — 31,936 
 
 Substandard — — — — — 3,535 — — 3,535 
 Total Residential Home Today — — — — — 35,471 — — 35,471 
 Home equity lines of credit 
 
 Pass — — — — — — 4,028,977 51,726 4,080,703 
 Special Mention — — — — — — 4,679 370 5,049 
 Substandard — — — — — — 9,678 5,235 14,913 
 Total Home equity lines of credit 
 — — — — — — 4,043,334 57,331 4,100,665 
 Home equity loans 
 
 Pass 317,633 236,210 126,622 43,623 13,831 14,336 — — 752,255 
 Special Mention 197 538 173 113 — 25 — — 1,046 
 Substandard 155 324 1,199 227 106 178 — — 2,189 
 Total Home equity loans 
 317,985 237,072 127,994 43,963 13,937 14,539 — — 755,490 
 
 
 
 Total Construction 4,998 2,274 — — — — — — 7,272 
 Total real estate loans 
 Pass 1,080,011 706,827 1,499,641 2,704,012 1,640,001 3,960,397 4,028,977 51,726 15,671,592 
 Special Mention 197 538 173 113 — 691 4,679 370 6,761 
 Substandard 155 485 3,223 4,227 3,146 24,901 9,678 5,235 51,050 
 Total real estate loans $ 1,080,363 $ 707,850 $ 1,503,037 $ 2,708,352 $ 1,643,147 $ 3,985,989 $ 4,043,334 $ 57,331 $ 15,729,403 

 (1) No new originations of Home Today loans since fiscal 2016. 
 94 

 Table of Contents 

 
 Revolving Loans Amortized Cost Basis 
 Revolving Loans Converted to Term 
 
 By fiscal year of origination 
 2024 2023 2022 2021 2020 Prior Total 
 September 30, 2024 
 Real estate loans: 
 Residential Core 
 Pass $ 573,935 $ 1,500,928 $ 2,934,968 $ 1,841,516 $ 1,205,702 $ 3,323,146 $ — $ — $ 11,380,195 
 Special Mention — — — 1,050 — 795 — — 1,845 
 Substandard 178 1,629 2,416 1,157 1,814 19,620 — — 26,814 
 Total Residential Core 574,113 1,502,557 2,937,384 1,843,723 1,207,516 3,343,561 — — 11,408,854 
 Residential Home Today (1) 
 
 Pass — — — — — 36,116 — — 36,116 
 
 Substandard — — — — — 4,355 — — 4,355 
 Total Residential Home Today — — — — — 40,471 — — 40,471 
 Home equity lines of credit 
 
 Pass — — — — — — 3,290,851 54,190 3,345,041 
 Special Mention — — — — — — 3,735 607 4,342 
 Substandard — — — — — — 5,880 4,880 10,760 
 Total Home equity lines of credit 
 — — — — — — 3,300,466 59,677 3,360,143 
 Home equity loans 
 
 Pass 305,870 163,969 57,254 18,461 5,147 14,621 — — 565,322 
 Special Mention 111 613 101 — — 51 — — 876 
 Substandard — 196 151 141 43 144 — — 675 
 Total Home equity loans 
 305,981 164,778 57,506 18,602 5,190 14,816 — — 566,873 
 
 
 
 Total Construction 7,932 2,083 — — — — — — 10,015 
 Total real estate loans 
 Pass 887,737 1,666,980 2,992,222 1,859,977 1,210,849 3,373,883 3,290,851 54,190 15,336,689 
 Special Mention 111 613 101 1,050 — 846 3,735 607 7,063 
 Substandard 178 1,825 2,567 1,298 1,857 24,119 5,880 4,880 42,604 
 Total real estate loans $ 888,026 $ 1,669,418 $ 2,994,890 $ 1,862,325 $ 1,212,706 $ 3,398,848 $ 3,300,466 $ 59,677 $ 15,386,356 

 (1) No new originations of Home Today loans since fiscal 2016. 
 The following table presents gross charge-offs of residential loan receivables recorded during the fiscal years presented. There were no gross charge-offs in the construction loan portfolio for the periods presented. 
 
 For the Year Ended September 30, 2025 
 Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term 
 By fiscal year of origination 
 2025 2024 2023 2022 2021 Prior Total 
 Real estate loans: 
 Residential Core 
 $ — $ — $ — $ — $ — $ 18 $ — $ — $ 18 
 Residential Home Today 
 — — — — — 15 — — 15 
 Home equity lines of credit 
 — — — — — — 607 457 1,064 
 Home equity loans 
 — — — — 17 — — — 17 
 
 Total real estate loans $ — $ — $ — $ — $ 17 $ 33 $ 607 $ 457 $ 1,114 

 95 

 Table of Contents 

 
 For the Year Ended September 30, 2024 
 Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term 
 By fiscal year of origination 
 2024 2023 2022 2021 2020 Prior Total 
 Real estate loans: 
 Residential Core 
 $ 11 $ — $ 20 $ — $ — $ 195 $ — $ — $ 226 
 Residential Home Today 
 — — — — — 112 — — 112 
 Home equity lines of credit 
 — — — — — — 470 372 842 
 Home equity loans 
 — — 16 17 — — — — 33 
 
 Total real estate loans $ 11 $ — $ 36 $ 17 $ — $ 307 $ 470 $ 372 $ 1,213 

 The home equity lines of credit converted from revolving to term loans during the years ended September 30, 2025 and September 30, 2024, totaled $ 13,705 and $ 10,475 , respectively. The amount of conversions to term loans is expected to remain relatively low for several years since the length of the draw period on new originations changed from five to 10 years in 2016. 
 Residential loans are internally assigned a grade that complies with the guidelines outlined in the OCC’s Handbook for Rating Credit Risk. Pass loans are assets well protected by the current paying capacity of the borrower. Special Mention loans have a potential weakness, as evaluated based on delinquency status or nature of the product, that the Company deems to deserve management’s attention and may result in further deterioration in their repayment prospects and/or the Company’s credit position. Substandard loans are inadequately protected by the current payment capacity of the borrower or the collateral pledged with a defined weakness that jeopardizes the liquidation of the debt. Also included in Substandard are performing home equity loans and lines of credit where the customer has a severely delinquent first mortgage to which the performing home equity loan or line of credit is subordinate and all loans in Chapter 7 bankruptcy status where all borrowers have filed, and have not reaffirmed or been dismissed. Loss loans are considered uncollectible and are charged-off when identified. Loss loans are of such little value that their continuance as bankable assets is not warranted even though partial recovery may be effected in the future. 
 Other loans are internally assigned a grade of non-performing when they become 90 days or more past due. At September 30, 2025 and September 30, 2024, no other loans were graded as non-performing. 
 MODIFICATIONS TO BORROWERS EXPERIENCING FINANCIAL DIFFICULTY 
 To mitigate losses, the Company works with borrowers who are experiencing financial difficulty to identify solutions the borrowers can afford by entering into agreements to modify their loans. These efforts often result in modifications to the payment terms of the loan, which vary by situation and may include interest rate reductions, term extensions (generally including capitalization of delinquent amounts), significant payment delays (including forbearance, partial payments and repayment of delinquent amounts), other, or a combination thereof. The Company does not generally offer principal forgiveness as a type of modification. The Other category includes loans that were modified multiple times during the period with different concessions. 
 If a borrower is experiencing an income curtailment that temporarily has reduced their capacity to repay, such as loss of employment, reduction of work hours, non-paid leave or short-term disability, a temporary modification is considered. If a borrower lacks the capacity to repay the loan at the current terms due to a permanent condition, a permanent modification is considered. Loans may be modified more than once. Among other requirements, a subsequent modification may be available for a borrower upon the expiration of temporary modified terms if the borrower is unable to resume contractually scheduled loan payments. In evaluating the need for a subsequent modification, the borrower’s ability to repay is generally assessed utilizing a debt-to-income and cash flow analysis. 
 96 

 Table of Contents 

 The following tables present the amortized cost of modifications by type in effect during the period presented for borrowers experiencing financial difficulty. For the years ended September 30, 2025 and September 30, 2024, there were no modifications made on construction loans. 
 
 Year Ended September 30, 2025 
 Interest Rate Reduction 
 Term Extension 
 Significant Payment Delay 
 Combination-Rate Reduction & Term Extension 
 Other 
 Total 
 % of Total Class 
 
 Residential Core $ — $ 1,777 $ 1,745 $ 651 $ 334 $ 4,507 0.04 % 
 Residential Home Today — 26 335 156 63 580 1.64 % 
 Home equity lines of credit — 109 284 565 — 958 0.02 % 
 Home equity loans — — 67 — — 67 0.01 % 
 
 Total $ — $ 1,912 $ 2,431 $ 1,372 $ 397 $ 6,112 0.04 % 

 
 Year Ended September 30, 2024 
 Interest Rate Reduction 
 Term Extension 
 Significant Payment Delay 
 Combination-Rate Reduction & Term Extension 
 Other 
 Total 
 % of Total Class 
 
 Residential Core $ 66 $ 1,416 $ 3,074 $ 842 $ 478 $ 5,876 0.05 % 
 Residential Home Today — 103 283 224 — 610 1.51 % 
 Home equity lines of credit — 30 690 305 25 1,050 0.03 % 
 Home equity loans — — 43 91 — 134 0.02 % 
 
 Total $ 66 $ 1,549 $ 4,090 $ 1,462 $ 503 $ 7,670 0.05 % 

 The following tables present the financial effects of the loan modifications presented above based on the type of modification. 
 
 For the Year Ended September 30, 2025 For the Year Ended September 30, 2024 
 Interest Rate Reduction 
 Term Extension 
 Interest Rate Reduction Term Extension 
 Weighted-Average Contractual 
 Interest Rate 
 Weighted-Average Years Added to Life 
 Weighted-Average Contractual
 Interest Rate Weighted-Average Years Added to Life 
 From 
 To 
 From To 
 Residential Core 5.88 % 3.50 % 10.5 3.96 % 2.07 % 10.3 
 Residential Home Today 6.69 % 3.68 % 2.4 3.93 % 2.01 % 14.9 
 Home equity lines of credit 4.90 % 3.89 % 22.3 6.66 % 3.28 % 6.0 
 Home equity loans — % — % 0.0 5.29 % 3.50 % 1.8 

 
 
 The performance of loans modified for borrowers experiencing financial difficulty is closely monitored by the Company to evaluate the effectiveness of modification efforts. Modifications made to borrowers experiencing financial difficulty that subsequently become 90 days or more past due under the modified terms are considered subsequently defaulted. The following tables provide information, by type of modification, about loans that were modified within the last 12 months and subsequently defaulted during the years ended September 30, 2025 and September 30, 2024. There were no home equity loans that subsequently defaulted during the years ended September 30, 2025 and September 30, 2024. 
 
 For the Year Ended September 30, 2025 
 Interest Rate Reduction 
 Term Extension 
 Significant Payment Delay 
 Combination-Rate Reduction & Term Extension Other Total 
 Residential Core $ — $ — $ 275 $ 78 $ 334 $ 687 
 Residential Home Today — — 57 — 63 120 
 Home equity lines of credit — — 64 — — 64 
 
 
 Total $ — $ — $ 396 $ 78 $ 397 $ 871 

 97 

 Table of Contents 

 
 For the Year Ended September 30, 2024 
 Interest Rate Reduction 
 Term Extension 
 Significant Payment Delay 
 Combination-Rate Reduction & Term Extension Other Total 
 Residential Core $ — $ — $ 25 $ 14 $ — $ 39 
 Residential Home Today — 4 18 — — 22 
 Home equity lines of credit — — 190 — — 190 
 
 
 Total $ — $ 4 $ 233 $ 14 $ — $ 251 

 The following table presents performance by loan type during the years ended September 30, 2025 and September 30, 2024, on loans modified during the previous 12 months for borrowers experiencing financial difficulty. The loans in delinquency status primarily consisted of loans with significant payment delays prior to modification, which continue to be reported delinquent based on their original contractual terms. 
 
 September 30, 2025 30-59
Days
Past Due 60-89
Days
Past Due 90 Days or
More Past
Due Total Past
Due Current 
 Total 
 
 Residential Core $ — $ 217 $ 771 $ 988 $ 3,518 $ 4,506 
 Residential Home Today — 54 184 238 342 580 
 Home equity lines of credit — — 106 106 853 959 
 Home equity loans — — 67 67 — 67 
 Total $ — $ 271 $ 1,128 $ 1,399 $ 4,713 $ 6,112 

 
 September 30, 2024 30-59
Days
Past Due 60-89
Days
Past Due 90 Days or
More Past
Due Total Past
Due Current 
 Total 
 
 Residential Core $ 651 $ 355 $ 1,165 $ 2,171 $ 3,705 $ 5,876 
 Residential Home Today 55 70 217 342 268 610 
 Home equity lines of credit 98 — 433 531 518 1,049 
 Home equity loans — — 43 43 92 135 
 Total $ 804 $ 425 $ 1,858 $ 3,087 $ 4,583 $ 7,670 

 
 
 
 6. MORTGAGE LOAN SERVICING RIGHTS 
 The Company sells certain types of loans through whole loan sales and through securitizations. The Company retains a servicing interest in the majority of loans or securitized loans. Certain assumptions and estimates are used to determine the fair value allocated to these retained interests at the date of transfer and at subsequent measurement dates. These assumptions and estimates include loan repayment rates and discount rates. 
 Changes in interest rates can affect the average life of loans and mortgage-backed securities and the related servicing rights. A reduction in interest rates normally results in increased prepayments, as borrowers refinance their debt in order to reduce their borrowing costs. This creates reinvestment risk, which is the risk that the Company may not be able to reinvest the proceeds of loan and securities prepayments at rates that are comparable to the rates earned on the loans or securities prior to receipt of the repayment. 
 98 

 Table of Contents 

 During 2025, 2024 and 2023, $ 397,062 , $ 237,106 and $ 77,206 , respectively, of mortgage loans were securitized and/or sold including accrued interest thereon with servicing retained. Primary economic assumptions used to measure the value of the Company’s retained servicing interests at the date of sale resulting from the completed transactions were as follows (per annum): 
 
 2025 2024 
 Primary prepayment speed assumptions (weighted average annual rate) 14.4 % 15.5 % 
 Weighted average life (years) 28.3 28.4 
 Amortized cost to service loans (weighted average) 0.12 % 0.12 % 
 Weighted average discount rate 12 % 12 % 

 Key economic assumptions and the sensitivity of the current fair value of mortgage loan servicing rights to immediate 10% and 20% adverse changes in those assumptions are as presented in the following table. The three key economic assumptions that impact the valuation of the mortgage loan servicing rights are: (1) the prepayment speed, or how long the mortgage servicing right will be outstanding; (2) the estimate of servicing costs that will be incurred in fulfilling the mortgage servicing right responsibilities; and (3) the discount factor applied to future net cash flows to convert them to present value. The Company established these factors based on independent analysis of its portfolio and reviews these assumptions periodically to ensure that they reasonably reflect current market conditions and its loan portfolio experience. 
 
 September 30, 2025 
 Fair value of mortgage loan servicing rights $ 17,457 
 Prepayment speed assumptions (weighted average annual rate) 10.3 % 
 Impact on fair value of 10% adverse change $ ( 659 ) 
 Impact on fair value of 20% adverse change $ ( 1,258 ) 
 Estimated prospective annual cost to service loans (weighted average) 0.12 % 
 Impact on fair value of 10% adverse change $ ( 1,568 ) 
 Impact on fair value of 20% adverse change $ ( 3,136 ) 
 Discount rate 12.0 % 
 Impact on fair value of 10% adverse change $ ( 622 ) 
 Impact on fair value of 20% adverse change $ ( 1,196 ) 

 These sensitivities are hypothetical and should be used with caution. As indicated in the table above, changes in fair value based on a 10% variation in assumptions generally cannot be extrapolated because the relationship in the change in assumption to the change in fair value may not be linear. Also, the effect of a variation in a particular assumption on the fair value of the retained interest is calculated without changing any other assumption. In reality, changes in one factor may result in changes in another (for example, increases in market interest rates may result in lower prepayments), which could magnify or counteract the sensitivities. 
 Servicing rights are evaluated periodically for impairment based on the fair value of those rights. Nineteen risk tranches are used in evaluating servicing rights for impairment, segregated primarily by interest rate stratum within original term to maturity categories with additional strata for less uniform account types. 
 Activity in mortgage servicing rights is summarized as follows. There was no change in the valuation allowance for the years ended September 30, 2025, 2024 and 2023. 
 
 Year Ended September 30, 
 2025 2024 2023 
 Balance—beginning of year $ 7,627 $ 7,400 $ 7,943 
 Additions from loan securitizations/sales 
 1,925 1,108 322 
 Amortization 
 ( 1,003 ) ( 881 ) ( 865 ) 
 
 Balance—end of year $ 8,549 $ 7,627 $ 7,400 
 Fair value of capitalized amounts $ 17,457 $ 17,093 $ 15,916 

 The Company receives annual servicing fees ranging from 0.02 % to 0.84 % of the outstanding loan balances. Servicing income, net of amortization of capitalized servicing rights, included in non-interest income, amounted to $ 4,301 in 2025, 
 99 

 Table of Contents 

 $ 4,255 in 2024 and $ 4,516 in 2023. The unpaid principal balance of mortgage loans serviced for others was approximately $ 2,134,527 , $ 1,966,634 and $ 1,933,249 at September 30, 2025, 2024 and 2023, respectively. The ratio of capitalized servicing rights to the unpaid principal balance of mortgage loans serviced for others was 0.40 %, 0.39 %, and 0.38 % at September 30, 2025, 2024 and 2023, respectively. 
 
 
 
 7. PREMISES, EQUIPMENT AND SOFTWARE, NET 
 Premises, equipment and software at cost are summarized as follows: 
 
 September 30, 
 2025 2024 
 Land $ 8,619 $ 8,619 
 Office buildings 62,712 61,917 
 Furniture, fixtures and equipment 42,576 41,958 
 Software 1 
 30,401 21,591 
 Leasehold improvements 12,093 12,563 
 156,401 146,648 
 Less: accumulated depreciation and amortization ( 116,379 ) ( 113,461 ) 
 Total $ 40,022 $ 33,187 

 (1) As of September 30, 2025, Software includes $ 8,751 of software in development. 
 During the years ended September 30, 2025, 2024 and 2023, depreciation and amortization expense on premises, equipment, and software was $ 4,620 , $ 4,615 and $ 4,921 , respectively. 
 
 
 
 8. LEASES 
 As a lessee, the Company enters into operating leases of buildings and land. The Company occupies certain banking branches, loan production and customer care call center offices and a disaster recovery site through non-cancellable operating leases with remaining terms from less than one year to 12 years. Most of the leases have fixed payment terms with annual fixed-escalation clauses. Certain leases have annual rent escalations based on subsequent year-to-year changes in the consumer price index. These year-to-year changes in the consumer price index are excluded from the calculation of right-of-use assets and lease liabilities and recognized as expense in the period in which they are incurred. Additionally, all variable lease costs that are not based on an index or rate, such as "common area maintenance" costs, are expensed as incurred. Most of the Company's leases include options to extend for five years. The leases do not have early-termination options. The Company has not included term extensions in the calculation of the lease term, as the Company does not consider it reasonably certain that the options will be exercised. As the interest rate implicit in all of the Company's lease contracts is not readily determinable, the Company utilized its incremental borrowing rate, which is the rate that would be incurred to borrow on a collateralized basis over a similar term on an amount equal to the total contractual lease payments in a similar economic environment. The incremental borrowing rate utilized for all the Company's leases is an FHLB Advance rate based on the lease term at commencement in determining the present value of lease payments. 
 Operating lease expense for the years ended September 30, 2025, 2024 and 2023, totaled $ 5,684 , $ 5,781 and $ 5,573 , respectively. Variable lease expense for the years ended September 30, 2025, 2024 and 2023, totaled $ 1,626 , $ 1,731 and $ 1,514 , respectively. During the years ended September 30, 2025, 2024 and 2023, the Company paid $ 5,623 , $ 5,708 and $ 5,556 , respectively, in cash for amounts included in the measurement of lease liabilities. As of September 30, 2025 and 2024, the Company has not entered into any material leases that have not yet commenced. 
 
 
 100 

 Table of Contents 

 The following table summarizes information relating to the Company's operating leases: 
 
 September 30, 
 2025 2024 
 Right-of-use assets, net of accumulated amortization (a) 
 $ 17,483 $ 17,841 
 Lease liabilities (b) $ 17,992 $ 18,304 
 Weighted Average Remaining Lease Term 5.07 years 5.30 years 
 Weighted Average Discount Rate 3.67 % 3.17 % 

 (a) Included in Other assets in the CONSOLIDATED STATEMENTS OF CONDITION . Effective September 30, 2025, and for all periods presented, right-of-use assets are disclosed net of accumulated amortization. Prior to this date they were presented as the gross amount. At September 30, 2024, the gross right-of-use assets was $ 42,868 and accumulated amortization was $ 25,027 . 
 (b) Included in Accrued expenses and other liabilities in the CONSOLIDATED STATEMENTS OF CONDITION 
 The following table summarizes the maturities of lease liabilities at the periods presented: 
 
 September 30, 
 2025 2024 
 Maturing in: 
 12 months or less $ 5,224 $ 5,495 
 13 to 24 months 4,151 4,388 
 25 to 36 months 3,430 3,093 
 37 to 48 months 2,633 2,359 
 49 to 60 months 1,868 1,548 
 over 60 months 2,437 3,139 
 Total minimum lease payments 19,743 20,022 
 Less imputed interest 1,751 1,718 
 Total lease liabilities $ 17,992 $ 18,304 

 
 
 
 9. DEPOSITS 
 Deposit account balances are summarized by interest rate as follows: 
 
 Stated Interest Rate 
 September 30, 
 2025 2024 
 Amount Percent Amount Percent 
 Checking accounts 0.00 – 1.00 % 
 $ 785,785 7.6 % $ 829,924 8.2 % 
 Savings accounts, excluding money market accounts 0.00 – 2.72 
 1,043,715 10.0 1,127,772 11.1 
 Money market accounts 0.00 – 2.23 
 128,245 1.2 193,074 1.9 
 Subtotal 1,957,745 18.8 2,150,770 21.2 
 Certificates of deposit 0.00 – 0.99 
 33,130 0.3 294,950 2.9 
 1.00 – 1.99 
 389,448 3.7 614,177 6.0 
 2.00 – 2.99 
 692,075 6.6 772,872 7.6 
 3.00 – 3.99 
 4,817,794 46.2 1,852,823 18.2 
 4.00 – 4.99 
 2,541,903 24.4 2,398,387 23.6 
 5.00 and above 
 153 — 2,087,914 20.5 
 
 
 8,474,503 81.2 8,021,123 78.8 
 Subtotal 10,432,248 100.0 10,171,893 100.0 
 Accrued interest 14,720 — 23,186 — 
 Total deposits $ 10,446,968 100.0 % $ 10,195,079 100.0 % 

 101 

 Table of Contents 

 At September 30, 2025 and 2024, the weighted average interest rate was 0.04 % and 0.04 % on checking accounts; 0.65 % and 1.27 % on savings accounts; 1.27 % and 2.10 % on money market accounts; 3.74 % and 4.03 % on certificates of deposit, respectively; and 3.12 % and 3.36 % on total deposits, respectively. 
 The aggregate amount of CD's in denominations of $250 or more was $ 1,533,487 and $ 1,283,719 at September 30, 2025 and 2024, respectively. In accordance with the DFA, the maximum amount of federal deposit insurance is $250 per depositor for each account ownership category. 
 Brokered CD's (exclusive of acquisition costs and subsequent amortization), which are used as an additional funding source, totaled $ 902,083 and $ 1,217,303 at September 30, 2025 and 2024, respectively. The FDIC places restrictions on banks with regard to issuing brokered deposits based on the bank's capital classification. As a well-capitalized institution at September 30, 2025 and 2024, the Association may accept brokered deposits without FDIC restrictions. 
 The scheduled maturity of certificates of deposit is summarized in the table below, which include the effective maturities and fixed interest rates of the $575,000 of brokered CDs that are tied to interest rate swaps discussed in Note 17. DERIVATIVE INSTRUMENTS. 
 
 September 30, 2025 
 Amount Percent Weighted
Average
Rate 
 12 months or less $ 5,637,622 66.5 % 3.70 % 
 13 to 24 months 1,001,024 11.8 % 3.41 % 
 25 to 36 months 1,503,195 17.7 % 3.74 % 
 37 to 48 months 191,785 2.3 % 3.59 % 
 49 to 60 months 131,815 1.6 % 3.60 % 
 Over 60 months 9,062 0.1 % 1.41 % 
 Total 
 $ 8,474,503 100.0 % 3.66 % 

 Interest expense on deposits is summarized as follows: 
 
 Year Ended September 30, 
 2025 2024 2023 
 Certificates of deposit $ 295,681 $ 270,162 $ 143,434 
 Checking accounts 439 401 6,081 
 Savings and money market accounts 
 12,640 22,165 24,686 
 Total 
 $ 308,760 $ 292,728 $ 174,201 

 102 

 
 Table of Contents 

 10. BORROWED FUNDS 
 At September 30, 2025, the Association had a maximum borrowing capacity of $7,898,558, of which $4,870,219 was outstanding. Borrowings from the FHLB of Cincinnati are secured by the Association’s investment in the common stock of the FHLB of Cincinnati, as well as by a blanket pledge of its first lien mortgage portfolio not otherwise pledged. The Association also has the ability to purchase Fed Funds through arrangements with other institutions. Additionally, the ability to borrow from the FRB-Cleveland Discount Window is available to the Association and is secured by a pledge of specific loans in the Association’s mortgage portfolio. 
 Total borrowings at September 30, 2025 are summarized in the table below: 
 
 Borrowing Capacity Borrowings Available Borrowings Outstanding 
 FHLB $ 6,938,119 $ 2,085,581 $ 4,852,538 
 FRB Cleveland 505,439 505,439 — 
 Fed Funds purchased 
 455,000 455,000 — 
 Subtotal $ 7,898,558 $ 3,046,020 4,852,538 
 Accrued interest 
 17,681 
 Total borrowings 
 $ 4,870,219 

 Maturities of borrowings at September 30, 2025 are summarized in the table below: 
 Maturing in: Amount Weighted Average Rate 
 12 months or less $ 1,198,115 3.32 % 
 13 to 24 months 1,025,000 3.27 % 
 25 to 36 months 851,040 3.84 % 
 37 to 48 months 776,739 3.48 % 
 49 to 60 months 
 1,000,000 3.47 % 
 over 60 months 1,644 1.39 % 
 Total advances 
 $ 4,852,538 3.46 % 
 Accrued interest 17,681 
 Total 
 $ 4,870,219 

 All borrowings have fixed rates during their term ranging up to 240 months. The table above reflects the effective maturities and fixed interest rates of the $3,000,000 of short-term FHLB advances that are tied to interest rate swaps discussed in Note 17. DERIVATIVE INSTRUMENTS. Interest is payable monthly for long-term FHLB advances and generally at maturity for FHLB advances with terms of three months or less. 
 For the years ended September 30, 2025, 2024 and 2023, net interest expense related to short-term borrowings was $ 103,008 , $ 105,224 and $ 115,329 , respectively. 
 103 

 
 Table of Contents 

 11. OTHER COMPREHENSIVE INCOME (LOSS) 
 The change in AOCI by component is as follows: 
 
 Fiscal year 2023 activity Unrealized Gains (Losses) on Securities Available for Sale Cash Flow Hedges Defined Benefit Plan Total 
 Balance at September 30, 2022 $ ( 33,899 ) $ 68,883 $ ( 11,835 ) $ 23,149 
 Other comprehensive income (loss) before reclassifications 
 ( 7,274 ) 112,851 1,904 107,481 
 Amounts reclassified 
 — ( 46,202 ) 784 ( 45,418 ) 
 Other comprehensive income (loss), net of tax 
 ( 7,274 ) 66,649 2,688 62,063 
 
 Balance at September 30, 2023 $ ( 41,173 ) $ 135,532 $ ( 9,147 ) $ 85,212 
 Tax expense (benefit) netted in other comprehensive income or loss 
 $ ( 2,427 ) $ 20,338 $ 704 $ 18,615 
 Fiscal year 2024 activity 
 Other comprehensive income (loss) before reclassifications 
 20,114 ( 58,522 ) 5,292 ( 33,116 ) 
 Amounts reclassified 
 — ( 68,124 ) 420 ( 67,704 ) 
 Other comprehensive income (loss), net of tax 
 20,114 ( 126,646 ) 5,712 ( 100,820 ) 
 Balance at September 30, 2024 $ ( 21,059 ) $ 8,886 $ ( 3,435 ) $ ( 15,608 ) 
 Tax expense (benefit) netted in other comprehensive income or loss 
 $ 5,969 $ ( 37,608 ) $ 1,668 $ ( 29,971 ) 
 Fiscal year 2025 activity 
 Other comprehensive income (loss) before reclassifications 
 4,469 25,929 ( 174 ) 30,224 
 Amounts reclassified 
 — ( 35,847 ) — ( 35,847 ) 
 Other comprehensive income (loss), net of tax 
 4,469 ( 9,918 ) ( 174 ) ( 5,623 ) 
 Balance at September 30, 2025 $ ( 16,590 ) $ ( 1,032 ) $ ( 3,609 ) $ ( 21,231 ) 
 Tax expense (benefit) netted in other comprehensive income or loss 
 $ 1,302 $ ( 2,946 ) $ ( 23 ) $ ( 1,667 ) 

 The following table presents the reclassification adjustment out of AOCI included in net income and the corresponding line item on the CONSOLIDATED STATEMENTS OF INCOME for the periods indicated: 
 
 Details about AOCI Components For the Years Ended September 30, Line Item in the Statement of Income 
 2025 2024 2023 
 
 
 
 
 
 Cash flow hedges: 
 Interest (income) expense $ ( 46,503 ) $ ( 88,354 ) $ ( 59,821 ) Interest expense 
 Net income tax effect 10,656 20,230 13,619 Income tax expense 
 Net of income tax expense (benefit) $ ( 35,847 ) $ ( 68,124 ) $ ( 46,202 ) 
 
 Amortization of defined benefit plan: 
 Actuarial loss $ — $ 547 $ 1,020 (a) 
 
 
 
 Net income tax effect — ( 127 ) ( 236 ) Income tax expense 
 Net of income tax expense — 420 784 
 
 Total reclassifications for the period $ ( 35,847 ) $ ( 67,704 ) $ ( 45,418 ) 

 (a) These items are included in the computation of net period pension cost. See Note 13. EMPLOYEE BENEFIT PLANS for additional disclosure . 
 104 

 
 Table of Contents 

 12. INCOME TAXES 
 The components of the income tax provision are as follows: 
 
 Year Ended September 30, 
 2025 2024 2023 
 Current tax expense (benefit): 
 Federal $ 20,497 $ 16,353 $ 13,602 
 State 1,907 1,670 781 
 Deferred tax expense (benefit): 
 Federal 1,278 2,466 3,681 
 State 74 236 53 
 Income tax provision $ 23,756 $ 20,725 $ 18,117 

 Reconciliation from tax at the federal statutory rate to the income tax provision is as follows: 
 
 Year Ended September 30, 
 2025 2024 2023 
 Tax at statutory rate 21.0 % 21.0 % 21.0 % 
 State tax, net 1.4 1.5 0.7 
 Non-taxable income from bank owned life insurance contracts ( 2.0 ) ( 2.1 ) ( 2.1 ) 
 Non-deductible compensation 1.1 1.2 1.0 
 Equity based compensation 0.5 0.4 0.2 
 Employee (Associate) Stock Ownership Plan 
 ( 1.4 ) ( 1.5 ) ( 1.5 ) 
 Other, net 0.1 0.2 0.1 
 Income tax provision 
 20.7 % 20.7 % 19.4 % 

 Temporary differences between the financial statement carrying amounts and tax basis of assets and liabilities that gave rise to significant portions of net deferred taxes relate to the following: 
 
 September 30, 
 2025 2024 
 Deferred tax assets: 
 Impairment and credit loss reserves 
 $ 30,214 $ 27,966 
 
 Deferred compensation 3,132 3,217 
 
 Lease liability 4,255 4,282 
 Property, equipment and software basis difference 947 1,029 
 Fair value adjustment 
 2,641 3,666 
 Other 2,043 2,149 
 Total deferred tax assets 43,232 42,309 
 Deferred tax liabilities: 
 
 Mortgage servicing rights 1,883 1,613 
 Pension 5,023 4,550 
 
 Goodwill 2,172 2,160 
 Lease ROU asset 4,135 4,173 
 
 Deferred loan costs, net of fees 15,568 15,576 
 Other 2,411 2,512 
 Total deferred tax liabilities 31,192 30,584 
 Net deferred tax asset (liability) 
 $ 12,040 $ 11,725 

 In the accompanying CONSOLIDATED STATEMENTS OF CONDITION the net deferred tax asset or liability is included in other assets, and accrued expenses and other liabilities for September 30, 2025 and 2024, respectively. 
 105 

 Table of Contents 

 A valuation allowance is established to reduce deferred tax assets if it is more likely than not that the related tax benefits will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. There was no valuation allowance required at September 30, 2025 or 2024. 
 Retained earnings at September 30, 2025 and 2024 included approximately $ 104,861 , for which no provision for federal or state income tax has been made. This amount represents allocations of income during years prior to 1988 to bad debt deductions for tax purposes only. These qualifying and non-qualifying base year reserves and supplemental reserves will be recaptured into income in the event of certain distributions and redemptions. Such recapture would create income for tax purposes only, which would be subject to the then current corporate income tax rate. However, recapture would not occur upon the reorganization, merger, or acquisition of the Association, nor if the Association is merged or liquidated tax-free into a bank or undergoes a charter change. If the Association fails to qualify as a bank or merges into a non-bank entity, these reserves will be recaptured into income. 
 The provisions of Accounting for Uncertainty in Income Taxes, codified within FASB ASC 740 “Income Taxes,” prescribe a recognition threshold and measurement attribute for the financial statement recognition and measurement for a tax position taken or expected to be taken in a tax return. FASB ASC 740 also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. Tax positions must meet a more-likely-than-not recognition threshold in order for the related tax benefit to be recognized or continue to be recognized. As of September 30, 2025 and 2024, the Company had no unrecognized tax benefits. The Company does not anticipate the total amount of unrecognized tax benefits to significantly change within the next twelve months. 
 The Company recognizes interest and penalties on income tax assessments or income tax refunds, where applicable, in the financial statements as a component of its provision for income taxes. The Company recognized $ 0 , $ 7 , and $ 0 of interest expense or penalties on income tax assessments during the years ended September 30, 2025, 2024 and 2023, respectively. There was no interest related to income tax assessments accrued at September 30, 2025 or 2024. 
 The Company’s effective income tax rate was 20.7 %, 20.7 % and 19.4 % for the years ended September 30, 2025, 2024 and 2023, respectively. 
 The Company and its subsidiaries file income tax returns in the U.S. federal jurisdiction and various state and city jurisdictions. With few exceptions, the Company is no longer subject to income tax examinations in its major jurisdictions for tax years prior to 2022. 
 On July 4, 2025, H.R. 1, commonly referred to as the One Big Beautiful Bill Act, (the "Act"), was signed into law. The Act makes various provisions of the 2017 Tax Cuts and Jobs Act permanent. The Company continues to evaluate the future impacts of these provisions, and does not expect the Act to have a material impact on the Company's financial statements. 
 The Company makes certain investments in limited partnerships which invest in affordable housing projects that qualify for the LIHTC. The Company acts as a limited partner in these investments and does not exert control over the operating or financial policies of the partnership. The Company accounts for its interests in LIHTCs using the proportional amortization method. The impact of the Company's investments in tax credit entities on the provision for income taxes was not material for the years ended September 30, 2025, 2024 and 2023. 
 106 

 
 Table of Contents 

 13. EMPLOYEE BENEFIT PLANS 
 Defined Benefit Plan — The Third Federal Savings Retirement Plan (the “Plan”) is a defined benefit pension plan. Effective December 31, 2002, the Plan was amended to limit participation to employees who met the Plan’s eligibility requirements on that date. Effective December 31, 2011, the Plan was amended to freeze future benefit accruals for participants in the Plan. After December 31, 2002, employees not participating in the Plan, upon meeting the applicable eligibility requirements, and those eligible participants who no longer receive service credits under the Plan, participate in a separate tier of the Company’s defined contribution 401(k) Savings Plan. Benefits under the Plan are based on years of service and the employee’s average annual compensation (as defined in the Plan) through December 31, 2011. The funding policy of the Plan is consistent with the funding requirements of U.S. federal and other governmental laws and regulations. There were no settlement adjustments made during the fiscal years 2025 or 2024. 
 The Company’s Board of Directors approved the termination of the Plan, effective December 31, 2025, with the final transfer of assets expected within nine to 12 months of plan termination. In anticipation of the plan termination, certain assumptions were changed to determine the projected benefit obligation which include the following: 
 • Retirees and 20 % of active and terminated vested participants are valued assuming a group annuity purchase. 
 • The remaining 80 % of active and terminated vested participants are valued assuming lump sum payments, using prescribed lump sum segment rates for August 2025 and the prescribed mortality assumption for 2025. 
 Those assumption changes resulted in a net decrease of $ 3,502 in the benefit obligation at September 30, 2025. The company is in the process of notifying plan participants and the appropriate regulatory bodies. The termination is not expected to have any material impact on the Company's liquidity or capital resources. 
 At September 30, 2025, the Plan continues to use an LDI strategy; however, during fiscal year 2025 the target allocation mix changed to 80 % LDI fixed income and 20 % in cash, from 80 % in LDI fixed income and 20 % in equity at September 30, 2024. This fully derisked structure reduces financial volatility as the plan moves toward termination. 
 The following table sets forth the change in projected benefit obligation for the defined benefit plan: 
 
 September 30, 
 2025 2024 
 Projected benefit obligation at beginning of year $ 62,855 $ 60,435 
 Interest cost 2,960 3,306 
 Actuarial (gain) loss and other ( 3,543 ) 3,365 
 
 Benefits paid ( 5,165 ) ( 4,251 ) 
 Projected benefit obligation at end of year $ 57,107 $ 62,855 

 The following table reconciles the beginning and ending balances of the fair value of Plan assets and presents the funded status of the Plan recognized in the CONSOLIDATED STATEMENTS OF CONDITION at the September 30 measurement dates. There were no employer contributions in the years ending September 30, 2025 and 2024. 
 
 September 30, 
 2025 2024 
 Fair value of plan assets at beginning of year $ 82,310 $ 72,383 
 Actual return on plan assets 1,046 14,178 
 
 Benefits paid ( 5,165 ) ( 4,251 ) 
 
 Fair value of plan assets at end of year $ 78,191 $ 82,310 
 Funded status of the plan—asset (liability) $ 21,084 $ 19,455 

 107 

 Table of Contents 

 The components of net periodic cost recognized in other non-interest expense in the CONSOLIDATED STATEMENTS OF INCOME are as follows: 
 
 Year Ended September 30, 
 2025 2024 2023 
 
 Interest Cost $ 2,960 $ 3,306 $ 3,324 
 Expected return on plan assets ( 4,786 ) ( 3,981 ) ( 3,872 ) 
 Amortization of net loss and other — 547 1,020 
 
 
 
 Net periodic benefit (income) cost 
 $ ( 1,826 ) $ ( 128 ) $ 472 

 There were no contributions, required minimum or voluntary, made during the fiscal year ended September 30, 2025. 
 The following table summarizes Plan assets measured at fair value on a recurring basis as of September 30, 2025 and 2024. See FN 16. FAIR VALUE for more information on how the Company's fair value hierarchy is evaluated: 
 
 Recurring Fair Value Measurements at Reporting Date Using 
 September 30, 2025 Total Fair Value Quoted Prices in
Active Markets for
Identical Assets
(Level 1) Significant Other
Observable Inputs
(Level 2) Significant
Unobservable
Inputs
(Level 3) 
 Cash equivalents 
 $ 7,878 $ 7,878 $ — $ — 
 Fixed income: 
 
 Mutual Bond Fund 
 10,158 10,158 — — 
 
 Corporate debt securities 
 50,728 — 50,728 — 
 Government strips 
 7,782 — 7,782 — 
 Asset-Backed Securities 
 263 — 263 — 
 Total fixed income 
 68,931 10,158 58,773 — 
 
 Total (1) 
 $ 76,809 $ 18,036 $ 58,773 $ — 

 (1) Plan assets measured at fair value on a recurring basis excludes approximately $ 1,382 of net unsettled security transactions. 
 
 
 
 Recurring Fair Value Measurements at Reporting Date Using 
 September 30, 2024 Total Fair Value Quoted Prices in
Active Markets for
Identical Assets
(Level 1) Significant Other
Observable Inputs
(Level 2) Significant
Unobservable
Inputs
(Level 3) 
 Cash equivalents $ 594 $ 594 $ — $ — 
 Fixed income: 
 U.S. government obligations 1,807 1,807 — — 
 Corporate debt securities 52,891 — 52,891 — 
 Government strips 9,024 — 9,024 — 
 Asset-Backed Securities 
 276 — 276 — 
 Total fixed income 63,998 1,807 62,191 — 
 Mutual equity funds 16,624 16,624 — — 
 Total (1) 
 $ 81,216 $ 19,025 $ 62,191 $ — 

 (1) Plan assets measured at fair value on a recurring basis excludes approximately 1,094 of net unsettled security transactions . 
 108 

 Table of Contents 

 There are no redemption restrictions on Plan assets at September 30, 2025. Redemptions may be deferred for a longer period if conditions do not permit an orderly transfer or for certain investments of an illiquid nature. 
 The following additional information is provided with respect to the Plan: 
 
 September 30, 
 2025 2024 2023 
 Assumptions and dates used to determine benefit obligations: 
 Discount rate 5.10 % 4.90 % 5.75 % 
 Rate of compensation increase n/a n/a n/a 
 
 Assumptions used to determine net periodic benefit cost: 
 Discount rate 4.90 % 5.75 % 5.35 % 
 Long-term rate of return on plan assets 6.25 % 5.75 % 5.50 % 
 Rate of compensation increase (graded scale) n/a n/a n/a 

 The expected long-term return on plan assets assumption was developed as a weighted average rate based on the target asset allocation of the Plan and the Long-Term Capital Market Assumptions for the corresponding fiscal year end. Management evaluates the historical performance of the various asset categories, as well as current expectations in determining the adequacy of the assumed rates of return in meeting Plan obligations. If warranted, the assumption is modified. 
 During the termination period, future benefit payments are expected to be $ 9,620 . Since the plan is fully funded, no minimum employer contributions are expected. 
 For the fiscal years ended September 30, 2025, 2024, and 2023, AOCI includes pretax net actuarial losses of $ 4,680 , $ 4,484 , and $ 11,862 , respectively, which have not been recognized as components of net periodic benefit costs as of the measurement date. The Company expects that $ 0 of net actuarial losses will be recognized as AOCI components of net periodic benefit cost during the fiscal year ended September 30, 2026. 
 401(k) Savings Plan — The Company maintains a 401(k) savings plan that is comprised of three tiers. The first tier allows eligible employees to contribute up to 75 % of their compensation to the plan, subject to limitations established by the Internal Revenue Service, with the Company matching 100 % of up to 4 % on funds contributed. The second tier permits the Company to make a profit-sharing contribution at its discretion. The first and second tiers cover substantially all employees who have reached age 18 and have worked 30 days of service within one year. The third tier permits the Company to make discretionary contributions allocable to eligible employees including those eligible employees who are participants, but no longer receiving service credits, under the Company’s defined benefit pension plan. Voluntary contributions made by employees are vested at all times whereas Company contributions and Company matching contributions are subject to various vesting periods which range from immediately vested to fully vesting upon five years of service. 
 The total of the Company’s matching and discretionary contributions related to the 401(k) savings plan for the years ended September 30, 2025, 2024 and 2023 was $ 4,070 , $ 3,404 and $ 4,297 , respectively. 
 Employee (Associate) Stock Ownership Plan — The Company established an ESOP for its employees (associates) effective January 1, 2006. The ESOP is a tax-qualified plan designed to invest primarily in the Company’s common stock and provides employees with an opportunity to receive a funded retirement benefit, based on the value of the Company’s common stock. The ESOP covers all eligible employees of the Company and its wholly-owned subsidiaries. Employees are eligible to participate in the ESOP after attainment of age 18 , completion of 1,000 hours of service, and employment on the last day of the plan’s calendar year. Company contributions to the plan are at the discretion of the Board of Directors. The ESOP is accounted for in accordance with the provisions for stock compensation in FASB ASC 718 . Compensation expense for the ESOP is based on the market price of the Company’s stock and is recognized as shares are committed to be released to participants. The total compensation expense related to this plan in the 2025, 2024 and 2023 fiscal years was $ 5,667 , $ 5,628 and $ 5,761 , respectively. 
 The ESOP was authorized to purchase, and did purchase, 11,605,824 shares of the Company’s common stock at a price of $ 10 per share with a 2006 plan year cash contribution and the proceeds of a loan from the Company to the ESOP. The outstanding loan principal balance as of September 30, 2025 and 2024 was $ 28,571 and $ 33,015 , respectively. Shares of the Company’s common stock pledged as collateral for the loan are released from the pledge for allocation to participants as loan payments are made. At September 30, 2025, 9,439,128 shares have been allocated to participants and 325,005 shares were committed to be released. Shares that are committed to be released will be allocated to participants at the end of the plan year (December 31). ESOP shares that are unallocated or not yet committed to be released totaled 1,841,691 at September 30, 2025, 
 109 

 Table of Contents 

 and had a fair market value of $ 29,974 . Participants have the option to receive dividends on allocated shares in cash or leave the dividend in the ESOP. Dividends are reinvested in Company stock for those participants who choose to leave their dividends in the ESOP or who do not make an election. The purchase of Company stock for reinvestment of dividends is made in the open market on or about the date of the cash disbursement to the participants who opt to take dividends in cash. Dividends on unallocated shares held in the Employer Stock fund were paid to the trustee to be used to make payments on the outstanding loan obligation. 
 
 
 
 14. EQUITY INCENTIVE PLAN 
 The TFS Financial Corporation Amended and Restated 2008 Equity Incentive Plan, approved by shareholders in February 2018 and the 2008 Equity Incentive Plan, approved by shareholders in May 2008, are collectively referred to as the "Equity Plan”. The amended and restated plan is substantially similar to the previous plan, except that the number of future shares eligible to be granted has been reduced to 8,450,000 shares, of which 6,286,393 shares remain available for future award, and the term to grant shares has been extended to February 21, 2028. 
 The following table presents share-based compensation expense and the related tax benefit recognized during the periods presented. The Company recorded excess tax benefits (expense) of $( 618 ), $( 397 ), and $( 224 ) related to share-based compensation awards for the years ended September 30, 2025, 2024 and 2023, respectively. 
 
 Year Ended September 30, 
 2025 2024 2023 
 Restricted stock units expense $ 2,630 $ 2,796 $ 3,366 
 Performance share units expense 1,237 997 874 
 Stock option expense 112 82 — 
 Total stock-based compensation expense $ 3,979 $ 3,875 $ 4,240 
 Tax benefit related to share-based compensation expense $ 620 $ 572 $ 778 

 Restricted stock units vest over a one to 10 year service period. The product of the number of units granted and the grant date market price of the Company’s common stock determines the fair value of restricted stock units under the Equity Plan. The Company recognizes compensation expense for the fair value of restricted stock units on a straight-line basis over the requisite service period. 
 The following is a summary of the status of the Company’s restricted stock units as of September 30, 2025, and changes therein during the year then ended. 
 Number of
Shares
Awarded Weighted Average Grant Date Fair Value 
 
 Outstanding at September 30, 2024 1,139,665 $ 12.49 
 Granted 
 178,700 $ 12.59 
 Released 
 ( 132,354 ) $ 14.25 
 Forfeited 
 ( 200 ) 12.94 
 Outstanding at September 30, 2025 (1) 1,185,811 $ 12.31 

 (1) Includes 765,748 shares with a weighted average grant date fair value of $ 11.87 that have vested but will not be issued until the recipients are no longer employed by the Company. 
 The weighted average grant date fair value of restricted stock units granted during the years ended September 30, 2025, 2024 and 2023 was $ 12.59 , $ 12.97 and $ 13.69 per share, respectively. The total fair value of restricted stock units vested during the years ended September 30, 2025, 2024 and 2023 was $ 1,886 , $ 7,323 , and $ 1,639 , respectively. Expected future compensation expense relating to the non-vested restricted stock units at September 30, 2025, is $ 2,434 over a weighted average period of 1.87 years. 
 Performance share units vest in the form of Company common stock issued at the end of a three -year period, based on the pro-rata achievement of performance based metrics over a two -year period. The range of payout is 0 % to 150 % of the number of share units granted. For performance stock units, fair value is estimated as the product of the number of performance units granted, adjusted for the probability of achievement, and the grant date market price of the Company’s common stock. The Company recognizes compensation expense for the fair value of performance share units on a straight-line basis over the 
 110 

 Table of Contents 

 requisite service period, based on the performance condition that is probable of achievement. Probability of achievement is reassessed at each reporting period and the cumulative effect of a change in estimate, if any, is recognized in the period of change. Cash dividend equivalents are accrued and paid only if and when the underlying units become vested and payable. 
 The following is a summary of the status of the Company’s performance share units as of September 30, 2025, and changes therein during the year then ended. No awards were forfeited during the year ended September 30, 2025. 
 Number of
Shares
Awarded Weighted Average Grant Date Fair Value 
 Outstanding at September 30, 2024 213,445 14.45 
 Granted 
 135,300 12.58 
 Released 
 ( 50,445 ) 17.80 
 Performance adjustment 
 ( 10,200 ) 13.69 
 
 Outstanding at September 30, 2025 288,100 13.01 

 The weighted average grant date fair value of performance share units granted during the year ended September 30, 2025, 2024 and 2023 was $ 12.58 , $ 12.94 , and $ 13.69 , respectively. The total fair value of performance share units vested during the years ended September 30, 2025, 2024 and 2023, totaled $ 898 , $ 1,119 , and $ 1,152 , respectively. Expected future compensation expense relating to the non-vested performance share units at September 30, 2025, is $ 1,760 over a weighted average period of 1.91 years. 
 Stock options have a contractual term of 10 years and vest over a one to seven year service period. The Company recognizes compensation expense for the fair values of these awards, which have installment vesting, on a straight-line basis over the requisite service period of the awards. 
 The following is a summary of the Company’s stock option activity and related information for the Equity Plan for the year ended September 30, 2025. 
 
 Number of
Stock Options Weighted
Average
Exercise
Price Weighted
Average
Remaining
Contractual
Life (years) Aggregate
Intrinsic
Value 
 Outstanding at September 30, 2024 2,189,675 $ 15.40 2.56 $ — 
 Granted 12,000 $ 13.23 
 Exercised 
 ( 107,400 ) $ 14.77 
 Forfeited 
 ( 600 ) $ 12.94 
 Expired 
 ( 863,800 ) $ 14.87 
 Outstanding at September 30, 2025 1,229,875 $ 15.81 2.95 $ 57,951 
 Vested and exercisable, at September 30, 2025 977,875 $ 16.55 1.54 $ 1,551 
 Vested or expected to vest, at September 30, 2025 1,229,875 $ 15.81 2.95 $ 57,951 

 
 
 
 
 
 
 
 

 The fair values of the stock options were estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted average assumptions. There were no stock options granted during the year ended September 30, 2023. 
 
 2025 2024 
 Expected dividend yield 
 8.54 % 8.73 % 
 Expected volatility 
 29.14 % 26.50 % 
 Risk-free interest rate 
 3.95 % 4.18 % 
 Expected option term (in years) 
 5.39 6.38 

 The expected dividend yields for 2025 and 2024 were estimated on the then-current annualized dividend payouts of $ 1.13 per share at both dates, which was the best estimate available on the measurement date. Volatility of the company's stock was used in the estimation of fair value. Management estimated the expected life of the options using the simplified method allowed under SEC Staff Accounting Bulletin No. 110, which expresses the views of the SEC regarding the use of a "simplified" method, as discussed in Staff Accounting Bulletin No. 107. The five and seven year Treasury yield in effect at the time of the grant provides the risk free rate of return for periods within the expected term of the options. 
 111 

 Table of Contents 

 The weighted average grant date fair value of options granted during the years ended September 30, 2025 and 2024 was $ 1.51 and $ 1.22 , respectively. Expected future compensation relating to the non-vested options outstanding as of September 30, 2025 is $ 125 over a weighted average period of 1.16 years. Upon exercise of vested options, management expects to draw on treasury stock as the source of the shares. The total intrinsic value of options exercised during the years ended September 30, 2025, 2024 and 2023 was $ 16 , $ 0 , and $ 820 , respectively. 
 
 
 
 15. COMMITMENTS AND CONTINGENT LIABILITIES 
 In the normal course of business, the Company enters into commitments with off-balance-sheet risk to meet the financing needs of its customers. Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments to originate or acquire loans generally have fixed expiration dates of 60 to 360 days or other termination clauses and may require payment of a fee. Unfunded commitments related to home equity lines of credit generally expire 10 years following the date that the line of credit was established, subject to various conditions including compliance with payment obligation, adequacy of collateral securing the line and maintenance of a satisfactory credit profile by the borrower. Since some of the commitments may expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. 
 Off-balance sheet commitments to extend credit involve elements of credit risk and interest rate risk in excess of the amount recognized in the CONSOLIDATED STATEMENTS OF CONDITION . The Company’s exposure to credit loss in the event of nonperformance by the other party to the commitment is represented by the contractual amount of the commitment. The Company generally uses the same credit policies in making commitments as it does for on-balance-sheet instruments. The allowance for credit losses related to off-balance sheet commitments is recorded in other liabilities in the CONSOLIDATED STATEMENTS OF CONDITION . Refer to Note 5. LOANS AND ALLOWANCES FOR CREDIT LOSSES for discussion on credit loss methodology. Interest rate risk on commitments to extend credit results from the possibility that interest rates may move unfavorably from the position of the Company since the time the commitment was made. 
 At September 30, 2025, the Company had commitments to originate or acquire loans and related allowances as follows: 
 
 Commitment Allowance 
 Fixed-rate mortgage loans $ 94,476 $ 706 
 Adjustable-rate mortgage loans 
 12,118 109 
 Home equity lines of credit 131,348 1,391 
 Home equity loans 90,206 1,905 
 Total $ 328,148 $ 4,111 

 At September 30, 2025, the Company had unfunded commitments outstanding and related allowances as follows: 
 
 Commitment Allowance 
 Home equity lines of credit $ 5,551,788 $ 25,974 
 Construction loans 4,934 30 
 Total $ 5,556,722 $ 26,004 

 At September 30, 2025, the unfunded commitment on home equity lines of credit, including commitments for accounts suspended as a result of material default or a decline in equity, is $ 5,600,845 . 
 At September 30, 2025 and September 30, 2024, the Company had $ 59,340 and $ 17,411 , respectively, in commitments to sell mortgage loans. At September 30, 2025 and September 30, 2024, the Company had $ 28,460 and $ 15,891 , respectively, in commitments to acquire mortgage loans, which are included in mortgage loan commitments above. 
 The above commitments are expected to be funded through normal operations. 
 The Association is undergoing an escheat audit covering Ohio, Kentucky and Florida. Any potential loss that may result from this matter is not reasonably estimable at September 30, 2025. 
 The Company and its subsidiaries are subject to various legal actions arising in the normal course of business. In the opinion of management, the resolution of these legal actions is not expected to have a material adverse effect on the Company’s consolidated financial condition, results of operation, or statements of cash flows. 
 112 

 
 Table of Contents 

 16. FAIR VALUE 
 Under U.S. GAAP, fair value is defined as the price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date under current market conditions. A fair value framework is established whereby assets and liabilities measured at fair value are grouped into three levels of a fair value hierarchy, based on the transparency of inputs and the reliability of assumptions used to estimate fair value. 
 Presented below is a discussion of the methods and significant assumptions used by the Company to estimate fair value. 
 Investment Securities Available for Sale — Investment securities available for sale are recorded at fair value on a recurring basis. At September 30, 2025 and 2024, this includes $ 520,659 and $ 526,251 , respectively, of investments in U.S. government and agency obligations including U.S. Treasury notes and investments in highly liquid collateralized mortgage obligations, that can include items issued by Fannie Mae, Freddie Mac, and Ginnie Mae, measured using the market approach. The fair values of investment securities represent unadjusted price estimates obtained from independent third-party nationally recognized pricing services using pricing models or quoted prices of securities with similar characteristics and are included in Level 2 of the hierarchy. Third party pricing is reviewed on a monthly basis for reasonableness based on the market knowledge and experience of company personnel that interact daily with the markets for these types of securities. 
 Mortgage Loans Held for Sale — The fair value of mortgage loans held for sale is estimated on an aggregate basis using a market approach based on quoted secondary market pricing for loan portfolios with similar characteristics. Loans held for sale are carried at the lower of cost or fair value, with the exception of mortgage loans held for sale subject to pending agency contracts to securitize and sell loans. The Company elects the fair value measurement option for mortgage loans held for sale subject to pending agency contracts to securitize and sell loans, as permitted under the fair value guidance in U.S. GAAP. This election is expected to reduce volatility in earnings related to market fluctuations between the contract trade and settlement dates. At September 30, 2025 and September 30, 2024, there were $ 22,861 and $ 10,713 pending agency contracts held for sale measured at fair value, respectively, with unpaid principal balances of $ 22,306 and $ 10,336 . For the years ended September 30, 2025 and 2024, net gain (loss) on the sale of loans includes $ 28 and $ 337 , respectively, related to unrealized gains or losses during the period due to changes in the fair value of loans held for sale subject to pending agency contracts. At September 30, 2025 and 2024 there were $ 34,801 and $ 7,061 of loans held for sale carried at cost, respectively. Loans held for sale are included in Level 2 of the hierarchy. Interest income on mortgage loans held for sale is recorded in interest income on loans. 
 Collateral-Dependent Loans — Collateral-dependent loans represent certain loans held for investment that are subject to a fair value measurement under U.S. GAAP because they are individually evaluated using a fair value measurement, such as the fair value of the underlying collateral. Credit loss is measured using a market approach based on the fair value of the collateral, less estimated costs to dispose, for loans the Company considers to be collateral-dependent due to a delinquency status or other adverse condition severe enough to indicate that the borrower can no longer be relied upon as the continued source of repayment. These conditions are described more fully in Note 5. LOANS AND ALLOWANCES FOR CREDIT LOSSES . To calculate the credit loss of collateral-dependent loans, the fair market values of the collateral, estimated using third-party appraisals in the majority of instances, are reduced by calculated estimated costs to dispose, derived from historical experience and recent market conditions. Any indicated credit loss is recognized by a charge to the allowance for credit losses. Subsequent increases in collateral values or principal pay downs on loans with recognized credit loss could result in a collateral-dependent loan being carried below its fair value. When no credit loss is indicated, the carrying amount is considered to approximate the fair value of that loan to the Company because contractually that is the maximum repayment the Company can expect. The amortized cost of loans individually evaluated for credit loss based on the fair value of the collateral are included in Level 3 of the hierarchy with assets measured at fair value on a non-recurring basis. The range and weighted average impact of estimated costs to dispose on fair values is determined at the time of credit loss or when additional credit loss is recognized and is included in quantitative information about significant unobservable inputs later in this note. 
 Real Estate Owned — Real estate owned includes real estate acquired as a result of foreclosure or by deed in lieu of foreclosure and is carried at the lower of the cost basis or fair value, less estimated costs to dispose. The carrying amounts of real estate owned at September 30, 2025 and September 30, 2024 were $ 1,921 and $ 174 , respectively. Fair value is estimated under the market approach using independent third party appraisals. As these properties are actively marketed, estimated fair values may be adjusted by management to reflect current economic and market conditions. At September 30, 2025 and 2024, these adjustments were not significant to reported fair values. At September 30, 2025 and 2024, $ 2,355 and $ 220 , respectively, of real estate owned is included in Level 3 of the hierarchy with assets measured at fair value on a non-recurring basis where the cost basis equals or exceeds the estimated fair values, less estimated costs to dispose, of $ 434 and $ 46 , respectively. There was no real estate owned carried at their original or adjusted cost basis at September 30, 2025 and 2024. 
 Derivatives — Derivative instruments include interest rate lock commitments on loans being originated or acquired for the held for sale portfolio, forward commitments on contracts to deliver mortgage loans, and interest rate swaps designated as cash 
 113 

 Table of Contents 

 flow hedges. Derivatives not designated as cash flow hedges are reported at fair value in Other assets or Other liabilities on the CONSOLIDATED STATEMENT OF CONDITION with changes in value recorded in current earnings. Derivatives qualifying as cash flow hedges are settled daily , bringing their fair value to $ 0 . Refer to Note 17. DERIVATIVE INSTRUMENTS for additional information on cash flow hedges and other derivative instruments. Interest rate lock commitments are commitments to lend at interest rates and amounts defined prior to funding. The fair value of interest rate lock commitments is adjusted by a closure rate based on the estimated percentage of commitments that will result in closed loans. The range and weighted average impact of the closure rate is included in quantitative information about significant unobservable inputs later in this note. A significant change in the closure rate may result in a significant change in the ending fair value measurement of these derivatives relative to their total fair value. Because the closure rate is a significantly unobservable assumption, interest rate lock commitments are included in Level 3 of the hierarchy. Forward commitments on contracts to deliver mortgage loans are included in Level 2 of the hierarchy. 
 Assets and liabilities carried at fair value on a recurring basis in the CONSOLIDATED STATEMENTS OF CONDITION at September 30, 2025 and 2024 are summarized below. 
 
 Recurring Fair Value Measurements at Reporting Date Using 
 September 30,
2025 Quoted Prices in
Active Markets for
Identical Assets
(Level 1) Significant Other
Observable Inputs
(Level 2) Significant
Unobservable
Inputs
(Level 3) 
 Assets 
 Investment securities available for sale: 
 
 REMIC’s $ 455,368 $ — $ 455,368 $ — 
 Fannie Mae certificates 2,719 — 2,719 — 
 Freddie Mac certificates 8,617 — 8,617 — 
 U.S. government and agency obligations 53,955 — 53,955 — 
 Mortgage loans held for sale 22,861 — 22,861 — 
 Derivatives: 
 
 Interest rate lock commitments 272 — — 272 
 
 Total $ 543,792 $ — $ 543,520 $ 272 
 Liabilities 
 Derivatives: 
 Forward commitments for the sale of mortgage loans 351 — 351 — 
 
 Total $ 351 $ — $ 351 $ — 

 
 114 

 Table of Contents 

 
 Recurring Fair Value Measurements at Reporting Date Using 
 September 30,
2024 Quoted Prices in
Active Markets for
Identical Assets
(Level 1) Significant Other
Observable Inputs
(Level 2) Significant
Unobservable
Inputs
(Level 3) 
 Assets 
 Investment securities available for sale: 
 REMIC’s $ 449,401 $ — $ 449,401 $ — 
 Fannie Mae certificates 2,945 — 2,945 — 
 Freddie Mac certificates 1,129 — 1,129 — 
 U.S. government and agency obligations 72,776 — 72,776 — 
 Mortgage loans held for sale 
 10,713 $ — 10,713 $ — 
 Derivatives: 
 Interest rate lock commitments 
 $ 395 — — $ 395 
 Total $ 537,359 $ — $ 536,964 $ 395 
 Liabilities 
 Derivatives: 
 Forward commitments for the sale of mortgage loans 
 72 — 72 — 
 Total $ 72 $ — $ 72 $ — 
 
 
 
 

 The table below presents a reconciliation of the beginning and ending balances and the location within the CONSOLIDATED STATEMENTS OF INCOME where gains (losses) due to changes in fair value are recognized on interest rate lock commitments which are measured at fair value on a recurring basis using significant unobservable inputs (Level 3). 
 
 Interest Rate Lock Commitments 
 Year Ended September 30, 
 2025 2024 2023 
 Beginning balance $ 395 $ ( 1 ) $ ( 333 ) 
 Gain during the period due to changes in fair value: 
 Included in other non-interest income ( 123 ) 396 332 
 Ending balance $ 272 $ 395 $ ( 1 ) 
 Change in unrealized gains for the period included in earnings for assets held at end of the reporting date $ 272 $ 395 $ ( 1 ) 

 Summarized in the tables below are those assets measured at fair value on a nonrecurring basis. 
 
 Nonrecurring Fair Value Measurements at Reporting Date Using 
 September 30,
2025 Quoted Prices in
Active Markets for
Identical Assets
(Level 1) Significant Other
Observable Inputs
(Level 2) Significant
Unobservable
Inputs
(Level 3) 
 Collateral-dependent loans, net of allowance $ 45,275 $ — $ — $ 45,275 
 
 Real estate owned (1) 
 2,355 — — 2,355 
 Total $ 47,630 $ — $ — $ 47,630 

 ______________________ 
 (1) Amounts represent fair value measurements of properties before deducting estimated costs to dispose. 
 115 

 Table of Contents 

 
 Nonrecurring Fair Value Measurements at Reporting Date Using 
 September 30,
2024 Quoted Prices in
Active Markets for
Identical Assets
(Level 1) Significant Other
Observable Inputs
(Level 2) Significant
Unobservable
Inputs
(Level 3) 
 Collateral-dependent loans, net of allowance $ 39,577 $ — $ — $ 39,577 
 
 Real estate owned (1) 
 220 — — 220 
 
 Total $ 39,797 $ — $ — $ 39,797 

 ______________________ 
 (1) Amounts represent fair value measurements of properties before deducting estimated costs to dispose. 
 The following provides quantitative information about significant unobservable inputs categorized within Level 3 of the Fair Value Hierarchy. 
 
 Fair Value 
 September 30, 2025 Valuation Technique(s) Unobservable Input Range Weighted Average 
 Collateral-dependent loans, net of allowance $ 45,275 Market comparables of collateral discounted to estimated net proceeds Discount rate applied to appraised value to estimated net proceeds: 
 • Residential Properties 0 - 28 % 3.2 % 
 
 Interest rate lock commitments $ 272 Quoted Secondary Market pricing Closure rate 0 - 100 % 98.7 % 

 
 Fair Value 
 September 30, 2024 Valuation Technique(s) Unobservable Input Range Weighted Average 
 Collateral-dependent loans, net of allowance $ 39,577 Market comparables of collateral discounted to estimated net proceeds Discount rate applied to appraised value to estimated net proceeds: 
 • Residential Properties 0 - 28 % 4.0 % 
 
 Interest rate lock commitments $ 395 Quoted Secondary Market pricing Closure rate 0 - 100 % 90.1 % 

 
 
 116 

 Table of Contents 

 The following tables present the estimated fair value of the Company's financial instruments and their carrying amounts as reported in the CONSOLIDATED STATEMENTS OF CONDITION . 
 
 September 30, 2025 
 Carrying Estimated Fair Value 
 Amount Total Level 1 Level 2 Level 3 
 Assets: 
 Cash and due from banks $ 24,176 $ 24,176 $ 24,176 $ — $ — 
 Interest earning cash equivalents 405,263 405,263 405,263 — — 
 Investment securities available for sale 520,659 520,659 — 520,659 — 
 Mortgage loans held for sale 57,662 58,325 — 58,325 — 
 Loans, net: 
 Mortgage loans held for investment 15,655,159 14,564,394 — — 14,564,394 
 Other loans 8,153 8,153 — — 8,153 
 Federal Home Loan Bank stock 235,363 235,363 N/A — — 
 
 Accrued interest receivable 62,553 62,553 — 62,553 — 
 Cash collateral received from or held by counterparty 6,910 6,910 6,910 — — 
 
 Derivatives 272 272 — — 272 
 Liabilities: 
 Checking and savings accounts $ 1,957,745 $ 1,957,745 $ — $ 1,957,745 $ — 
 Certificates of deposit 8,489,223 8,511,443 — 8,511,443 — 
 Borrowed funds 4,870,219 4,892,273 — 4,892,273 — 
 Borrowers’ advances for taxes and insurance 113,168 113,168 — 113,168 — 
 Principal, interest and escrow owed on loans serviced 30,328 30,328 — 30,328 — 
 
 
 
 Derivatives 351 351 — 351 — 

 117 

 Table of Contents 

 
 September 30, 2024 
 Carrying Estimated Fair Value 
 Amount Total Level 1 Level 2 Level 3 
 Assets: 
 Cash and due from banks $ 26,287 $ 26,287 $ 26,287 $ — $ — 
 Interest earning cash equivalents 437,431 437,431 437,431 — — 
 Investment securities available for sale 526,251 526,251 — 526,251 — 
 
 Mortgage loans held for sale 17,775 17,986 — 17,986 — 
 Loans, net: 
 Mortgage loans held for investment 15,316,354 13,922,944 — — 13,922,944 
 Other loans 5,705 5,705 — — 5,705 
 Federal Home Loan Bank stock 228,494 228,494 N/A — — 
 Accrued interest receivable 59,398 59,398 — 59,398 — 
 
 Cash collateral received from or held by counterparty 7,844 7,844 7,844 — — 
 Derivatives 395 395 — — 395 
 Liabilities: 
 Checking and savings accounts $ 2,150,770 $ 2,150,770 $ — $ 2,150,770 $ — 
 Certificates of deposit 8,044,309 7,989,992 — 7,989,992 — 
 Borrowed funds 4,792,847 4,819,873 — 4,819,873 — 
 Borrowers’ advances for taxes and insurance 113,637 113,637 — 113,637 — 
 Principal, interest and escrow owed on loans serviced 28,753 28,753 — 28,753 — 
 Derivatives 72 72 — 72 — 

 
 
 
 
 17. DERIVATIVE INSTRUMENTS 
 The Company enters into interest rate swaps to add stability to interest expense and manage exposure to interest rate movements as part of an overall risk management strategy. For hedges of the Company's borrowing and deposit program, interest rate swaps designated as cash flow hedges involve the receipt of variable amounts from a counterparty in exchange for the Company making fixed payments. These derivatives are used to hedge the forecasted cash outflows associated with the Company's FHLB borrowings and brokered certificates of deposit. Cash flows from derivatives used to manage interest rate risks are classified as operating activities in the cash flow statement. The Company classifies both the earnings and cash flow impact from these derivatives consistent with the underlying hedged item. 
 Cash flow hedges are initially assessed for effectiveness using regression analysis. Changes in the fair value of derivatives designated and that qualify as cash flow hedges is recorded in OCI and is subsequently reclassified into earnings during the period in which the hedged forecasted transaction affects earnings. Derivatives qualifying as cash flow hedges are settled daily, bringing their fair value to $ 0 . Quarterly, a quantitative analysis is preformed to monitor the ongoing effectiveness of each hedging instrument. All derivative positions continue to be highly effective at September 30, 2025. 
 The Company enters into forward commitments for the sale of mortgage loans primarily to protect against the risk of lost revenue from adverse interest rate movements on net income. The Company recognizes the fair value of such contracts when the characteristics of those contracts meet the definition of a derivative. These derivatives are not designated in a hedging relationship; therefore, gains and losses are recognized immediately in the CONSOLIDATED STATEMENTS OF INCOME . 
 In addition, the Company is party to derivative instruments when it enters into interest rate lock commitments to originate a portion of its loans, which when funded, are classified as held for sale. Such commitments are not designated in a hedging relationship; therefore, gains and losses are recognized immediately in the CONSOLIDATED STATEMENTS OF INCOME . 
 
 
 118 

 Table of Contents 

 The following tables provide the locations within the CONSOLIDATED STATEMENTS OF CONDITION , notional values for all derivative instruments, and fair values for derivatives not designated as hedging instruments, at the reporting dates. 
 
 September 30, 2025 September 30, 2024 
 Weighted Average Weighted Average 
 Notional Value Term (years) Fixed-Rate Payments Notional Value Term (years) Fixed-Rate Payments 
 Derivatives designated as hedging instruments 
 Cash flow hedges: Interest rate swaps 
 Other Assets 
 $ 1,675,000 2.2 2.95 % $ 2,075,000 2.3 2.68 % 
 Other Liabilities 
 1,900,000 3.2 3.66 % 1,575,000 4.1 3.67 % 
 Total cash flow hedges: Interest rate swaps 
 $ 3,575,000 2.7 3.32 % $ 3,650,000 3.1 3.10 % 

 
 
 
 September 30, 2025 September 30, 2024 
 Notional Value Fair Value Notional Value Fair Value 
 Derivatives not designated as hedging instruments 
 Interest rate lock commitments 
 Other Assets 
 $ 11,500 $ 272 11,467 395 
 
 
 Forward Commitments for the sale of mortgage loans 
 
 Other Liabilities 59,340 ( 351 ) 17,411 ( 72 ) 
 Total derivatives not designated as hedging instruments $ 70,840 $ ( 79 ) $ 28,878 $ 323 

 
 
 The following tables present the net gains and losses recorded within the CONSOLIDATED STATEMENTS OF INCOME and the CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME relating to derivative instruments. 
 
 Location of Gain or (Loss) 
Recognized in Income Year Ended September 30, 
 2025 2024 2023 
 Cash flow hedges 
 Amount of gain/(loss) recognized Other comprehensive income $ 33,639 $ ( 75,900 ) $ 146,807 
 Amount of gain reclassified from AOCI 
 Interest expense: Borrowed funds and Deposits 
 46,503 88,354 59,821 
 
 
 
 Derivatives not designated as hedging instruments 
 Interest rate lock commitments Other non-interest income $ ( 123 ) $ 395 $ 332 
 Forward commitments for the sale of mortgage loans Net gain/(loss) on the sale of loans ( 279 ) ( 72 ) 11 
 

 The Company estimates that $ 8,761 of the amounts reported in AOCI will be reclassified as a reduction to interest expense during the fiscal year ending September 30, 2026. 
 Derivatives contain an element of credit risk which arises from the possibility that the Company will incur a loss because a counterparty fails to meet its contractual obligations. The Company's exposure is limited to the replacement value of the contracts rather than the notional or principal amounts. Credit risk is minimized through counterparty margin payments, transaction limits and monitoring procedures. All of the Company's swap transactions are cleared through a registered clearing broker to a central clearing organization. The clearing organization establishes daily cash and upfront cash or securities margin requirements to cover potential exposure in the event of default. This process shifts the risk away from the counterparty, since the clearing organization acts as an intermediary on each cleared transaction. At September 30, 2025 and 2024, there was $ 6,910 and $ 7,844 , respectively, of cash collateral included in other assets, and $ 50,032 and $ 68,932 , respectively, included in investment securities related to initial margin requirements that are held by the central clearing organization. For derivative transactions cleared through certain clearing parties, variation margin payments are recognized as settlements on a daily basis. The fair value of derivative instruments are presented on a gross basis, even when the derivative instruments are subject to master netting arrangements. 
 
 
 119 

 
 Table of Contents 

 18. PARENT COMPANY ONLY FINANCIAL STATEMENTS 
 The following condensed financial statements for TFS Financial Corporation (parent company only) reflect the investments in, and transactions with, its wholly-owned subsidiaries. Intercompany activity is eliminated in the consolidated financial statements. 
 
 September 30, 
 2025 2024 
 Statements of Condition 
 Assets: 
 Cash and due from banks $ 1,679 $ 1,556 
 Investment securities - available for sale 3,923 3,844 
 Other loans: 
 Demand loan due from Third Federal Savings and Loan 111,178 124,683 
 ESOP loan receivable 28,571 33,015 
 Investments in: 
 Third Federal Savings and Loan 1,743,060 1,692,789 
 Non-thrift subsidiaries 8,672 8,440 
 Prepaid federal and state taxes 92 75 
 Deferred income taxes — 80 
 Accrued receivables and other assets 8,662 9,277 
 Total assets $ 1,905,837 $ 1,873,759 
 Liabilities and shareholders’ equity: 
 Line of credit due non-thrift subsidiary $ 8,697 $ 8,439 
 Accrued expenses and other liabilities 3,093 2,696 
 Deferred income taxes 123 — 
 Total liabilities 11,913 11,135 
 Preferred stock, $ 0.01 par value, 100,000,000 shares authorized, none issued and outstanding 
 — — 
 Common stock, $ 0.01 par value, 700,000,000 shares authorized; 332,318,750 shares issued; 280,590,497 and 280,710,854 outstanding at September 30, 2025 and September 30, 2024, respectively 
 3,323 3,323 
 Paid-in capital 1,757,813 1,754,365 
 Treasury stock, at cost; 51,728,253 and 51,607,896 shares at September 30, 2025 and September 30, 2024, respectively 
 ( 774,340 ) ( 772,195 ) 
 Unallocated ESOP shares ( 18,417 ) ( 22,750 ) 
 Retained earnings—substantially restricted 946,776 915,489 
 Accumulated other comprehensive income ( 21,231 ) ( 15,608 ) 
 Total shareholders’ equity 1,893,924 1,862,624 
 Total liabilities and shareholders’ equity $ 1,905,837 $ 1,873,759 

 120 

 Table of Contents 

 
 Years Ended September 30, 
 2025 2024 2023 
 Statements of Comprehensive Income (Loss) 
 Interest income: 
 Demand loan due from Third Federal Savings and Loan $ 6,062 $ 8,401 $ 9,047 
 ESOP loan 2,308 2,805 2,433 
 Other interest income 64 72 54 
 Investment securities available for sale 45 45 45 
 Total interest income 8,479 11,323 11,579 
 Interest expense: 
 Borrowed funds from non-thrift subsidiaries 348 402 351 
 Total interest expense 348 402 351 
 Net interest income 8,131 10,921 11,228 
 Non-interest income: 
 Intercompany service charges 37 30 30 
 Dividend from Third Federal Savings and Loan 40,000 — 40,000 
 
 Total other income 40,037 30 40,030 
 Non-interest expenses: 
 Salaries and employee benefits 5,816 5,331 4,825 
 Professional services 1,742 1,159 1,253 
 Office property and equipment 13 13 13 
 Other operating expenses 133 250 217 
 Total non-interest expenses 7,704 6,753 6,308 
 Income before income tax benefit 40,464 4,198 44,950 
 Income tax benefit ( 1,709 ) ( 1,120 ) ( 1,294 ) 
 Income before undistributed earnings of subsidiaries 42,173 5,318 46,244 
 Equity in undistributed earnings of subsidiaries (dividend in excess of earnings): 
 Third Federal Savings and Loan 48,554 74,097 28,843 
 Non-thrift subsidiaries 232 173 163 
 Net income 90,959 79,588 75,250 
 Change in net unrealized gain (loss) on securities available for sale 4,469 20,114 ( 7,273 ) 
 Change in cash flow hedges ( 9,918 ) ( 126,646 ) 66,649 
 Change in pension obligation ( 174 ) 5,712 2,688 
 Total other comprehensive income (loss) ( 5,623 ) ( 100,820 ) 62,064 
 Total comprehensive income $ 85,336 $ ( 21,232 ) $ 137,314 

 121 

 Table of Contents 

 
 Years Ended September 30, 
 2025 2024 2023 
 Statements of Cash Flows 
 Cash flows from operating activities: 
 Net income $ 90,959 $ 79,588 $ 75,250 
 Adjustments to reconcile net income to net cash provided by operating activities: 
 (Equity in undistributed earnings of subsidiaries) dividend in excess of earnings: 
 Third Federal Savings and Loan ( 48,554 ) ( 74,097 ) ( 28,843 ) 
 Non-thrift subsidiaries ( 232 ) ( 173 ) ( 163 ) 
 Deferred income taxes 183 73 87 
 ESOP and stock-based compensation expense 2,232 2,037 1,863 
 Net decrease (increase) in interest receivable and other assets 613 1,189 ( 1,351 ) 
 Net increase (decrease) in accrued expenses and other liabilities 225 223 ( 273 ) 
 Net cash provided by operating activities 45,426 8,840 46,570 
 Cash flows from investing activities: 
 
 
 Decrease in balances lent to Third Federal Savings and Loan 
 13,505 47,624 12,465 
 
 Net cash provided by investing activities 
 13,505 47,624 12,465 
 Cash flows from financing activities: 
 Principal reduction of ESOP loan 4,444 4,239 4,673 
 Purchase of treasury shares ( 3,201 ) — ( 5,000 ) 
 Dividends paid to common shareholders ( 59,533 ) ( 58,953 ) ( 58,294 ) 
 Acquisition of treasury shares through net settlement ( 776 ) ( 1,925 ) ( 978 ) 
 Net increase in borrowings from non-thrift subsidiaries 
 258 307 647 
 Net cash used in financing activities ( 58,808 ) ( 56,332 ) ( 58,952 ) 
 Net increase in cash and cash equivalents 
 123 132 83 
 Cash and cash equivalents—beginning of year 1,556 1,424 1,341 
 Cash and cash equivalents—end of year $ 1,679 $ 1,556 $ 1,424 

 
 
 
 19. EARNINGS PER SHARE 
 Basic earnings per share is the amount of earnings available to each share of common stock outstanding during the reporting period. Diluted earnings per share is the amount of earnings available to each share of common stock outstanding during the reporting period, adjusted to include the effect of potentially dilutive common shares. For purposes of computing earnings per share amounts, outstanding shares include shares held by the public, shares held by the ESOP that have been allocated to participants or committed to be released for allocation to participants and the 227,119,132 shares held by Third Federal Savings, MHC. For purposes of computing dilutive earnings per share, stock options and restricted and performance share units with a dilutive impact are added to the outstanding shares used in the basic earnings per share calculation. Unvested shares awarded pursuant to the Company's restricted stock plans are treated as participating securities in the computation of EPS pursuant to the two-class method as they contain non-forfeitable rights to dividends. The two-class method is an earnings allocation that determines EPS for each class of common stock and participating security. Performance share units, determined to be contingently issuable and not participating securities, are excluded from the calculation of basic EPS. At September 30, 2025 and 2024, the ESOP held 1,841,691 and 2,275,031 shares, respectively, that were neither allocated to participants nor committed to be released to participants. 
 
 
 122 

 Table of Contents 

 The following is a summary of the Company’s EPS calculations. 
 
 For the Year Ended September 30, 2025 
 Income Shares Per share
 amount 
 (Dollars in thousands, except per share data) 
 Net income $ 90,959 
 Less: income allocated to restricted stock units 1,458 
 Basic earnings per share: 
 Income available to common shareholders 89,501 278,715,769 $ 0.32 
 Diluted earnings per share: 
 Effect of dilutive potential common shares 1,042,756 
 Income available to common shareholders $ 89,501 279,758,525 $ 0.32 

 
 
 For the Year Ended September 30, 2024 
 Income Shares Per share
 amount 
 (Dollars in thousands, except per share data) 
 Net income $ 79,588 
 Less: income allocated to restricted stock units 1,426 
 Basic earnings per share: 
 Income available to common shareholders 78,162 278,178,496 $ 0.28 
 Diluted earnings per share: 
 Effect of dilutive potential common shares 965,028 
 Income available to common shareholders $ 78,162 279,143,524 $ 0.28 

 
 
 For the Year Ended September 30, 2023 
 Income Shares Per share
 amount 
 (Dollars in thousands, except per share data) 
 Net income $ 75,250 
 Less: income allocated to restricted stock units 1,569 
 Basic earnings per share: 
 Income available to common shareholders 73,681 277,436,382 $ 0.27 
 Diluted earnings per share: 
 Effect of dilutive potential common shares 1,147,072 
 Income available to common shareholders $ 73,681 278,583,454 $ 0.26 

 
 
 The following is a summary of outstanding stock options and restricted and performance share units that are excluded from the computation of diluted EPS because their inclusion would be anti-dilutive. 
 
 For the Year Ended September 30, 
 2025 2024 2023 
 Options to purchase shares 1,214,875 2,189,675 1,991,975 
 Restricted and performance share units 20,000 30,000 57,669 

 
 
 
 
 
 
 
 123 

 Table of Contents 

 20. RECENT ACCOUNTING PRONOUNCEMENTS 
 Adopted in fiscal year ended September 30, 2025 
 In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280) – Improvements to Reportable Segment Disclosures . The amendments in this update improve disclosures about a public entity's reportable segments and address requests from investors and other allocators of capital for additional information about a reportable segment's expenses. While the Company only has one reportable segment, the update requires public entities with a single segment to provide all segment disclosures under ASC 280. The amendments in this update are effective for fiscal years beginning after December 15, 2023, or the Company's Form 10-K for the fiscal year ending September 30, 2025, and interim periods within fiscal years beginning after December 15, 2024, or the Company's fiscal year ending September 30, 2026, beginning with the Form 10-Q for the quarter ending December 31, 2025. Retrospective application is required for all prior periods presented in the financial statements. The adoption does not have a material effect on the Company's consolidated financial statements or disclosures. The required disclosures are included in Note 1. DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES. 
 Issued but not yet adopted as of September 30, 2025 
 In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740) . The ASU requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. The update is effective for fiscal years beginning after December 15, 2024, or the Company's fiscal year ending September 30, 2026. Management is currently evaluating the impact of the ASU on the Company's income tax disclosures within the consolidated financial statements and do not expect this ASU to have a material impact. 
 In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40) . The amendments in this update improve the disclosures about a public business entity's expenses and address requests from investors for more detailed information about the types of expenses in commonly presented expense captions. The new guidance is effective for public business entities for annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027. Early adoption is permitted. The amendments in this ASU may be applied either (1) prospectively to financial statements issued for reporting periods after the effective date of this ASU or (2) retrospectively to all prior periods presented in the financial statements. Management is currently evaluating the impact of this standard on the Company's consolidated financial statements and related disclosures. 
 In July 2025, the FASB issued ASU 2025-05, Credit Losses (Topic 326) Measurement of Credit Losses for Accounts Receivable and Contract Assets . The amendments in this update provide a practical expedient permitting an entity to assume that conditions at the balance sheet date remain unchanged over the life of the asset when estimating expected credit losses for current classified accounts receivable and contract assets under ASC 606. The update is effective for fiscal years beginning after December 15, 2025, and interim periods beginning after December 15, 2026. Adoption of this ASU can be applied prospectively for reporting periods after its effective date with early adoption permitted. Management is evaluating the provisions of this ASU and do not expect this ASU to have a material impact on the Company's consolidated financial statements. 
 In September 2025, the FASB issued ASU 2025-06, Intangibles – Goodwill and Other Internal-Use Software (Subtopic 350-40) . The amendments in this update are intended to improve the accounting for internal-use software. The ASU simplifies the capitalization guidance by removing all references to the sequential software development stages throughout ASC 350-40. The amendments in this update are effective for all entities for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods. The amendments in this ASU may be applied either (1) prospectively to financial statements issued for reporting periods after the effective date of this ASU or (2) retrospectively to all prior periods presented in the financial statements or (3) through a modified transition approach that is based on the status of the respective projects. Management is evaluating the provisions of this ASU and do not expect this ASU to have a material impact on the Company's consolidated financial statements. 
 In September 2025, the FASB issued ASU 2025-07, Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606) . The amendments in this update refines the scope of Topic 815 to clarify which contracts are subject to derivative accounting and also clarifies the guidance on share-based payments from a customer in a revenue contract under Topic 606. The new guidance is effective for annual reporting periods beginning after December 15, 2026, with early adoption permitted. Management is evaluating the provisions of this ASU and do not expect this ASU to have a material impact on the Company's consolidated financial statements. 
 124 

 Table of Contents 

 In November 2025, the FASB issued ASU 2025-08, Financial Instruments – Credit Losses (Topic 326) . The amendments in this update expand the use of the gross-up approach to certain acquired loans beyond purchased financial assets with credit deterioration. The new guidance is effective for annual reporting periods beginning after December 15, 2026, with early adoption permitted. The amendments in this update must be adopted prospectively to loans that are acquired on or after the initial application date. Management is evaluating the provisions of this ASU and do not expect this ASU to have a material impact on the Company's consolidated financial statements. 
 The Company has determined that all other recently issued accounting pronouncements will not have a material impact on the Company's consolidated financial statements or do not apply to its operations. 
 
 
 
 21. RELATED PARTY TRANSACTIONS 
 The Company has periodically made loans and extensions of credit, in the ordinary course of business, to certain directors and executive officers. These loans were originated with normal credit terms, including interest rate and collateralization, and do not represent more than the normal risk of collection. The aggregate amount of loans to such related parties at September 30, 2025 and 2024 was $ 451 and $ 0 , respectively. 
 125 

 
 Table of Contents 

 FORM 10-K EXHIBIT INDEX 
 
 Exhibit 
 Number 
 Description of Exhibit If Incorporated by Reference, Documents with 
 Which Exhibit was Previous Filed with SEC 
 
 
 3.1 
 Amended and Restated Charter of TFS Financial Corporation, dated January 16, 2007 
 Amendment No. 2 to Registration Statement on Form S-1 No. 333-139295 (filed with the SEC on February 9, 2006; Exhibit 3.2 therein) 
 
 3.2 
 Amended and Restated Bylaws of TFS Financial Corporation 
 Current Report on Form 8-K No. 001-33390 (filed with the SEC on April 28, 2008; Exhibit 3.2 therein) 
 
 3.3 
 Amendment to Bylaws of TFS Financial Corporation 
 Current Report on Form 8-K No. 001-33390 (filed with the SEC on October 29, 2018; Exhibit 3 therein) 
 
 3.4 
 Amendment to Bylaws of TFS Financial Corporation 
 Current Report on Form 8-K No. 001-33390 (filed with the SEC on July 1, 2022; Exhibit 3 therein) 
 
 3.5 
 A mendment to Bylaws of TFS Financial Corporation 
 Current Report on Form 8-K No. 001-33390 (filed with the SEC on October 24, 2024; Exhibit 3 therein) 
 
 
 4.1 
 Form of Common Stock Certificate of TFS Financial Corporation 
 Registration Statement on Form S-1 No. 333-139295 (filed with the SEC on December 13, 2006; Exhibit 4 therein) 
 
 4.2 
 Description of Registrant's Securities 
 Annual Report on Form 10-K No. 001-33390 (filed with the SEC on November 24, 2020; Exhibit 4.2 therein) 
 
 10.1 [Intentionally omitted] 
 
 10.2 
 Financial, Retirement & Estate Planning Program as amended and restated January 1, 2006 
 Registration Statement on Form S-1 No. 333-139295 (filed with the SEC on December 13, 2006; Exhibit 10.2 therein) 
 
 10.3 
 Resolution Regarding Executive Physical Program, dated May 16, 2002 
 Registration Statement on Form S-1 No. 333-139295 (filed with the SEC on December 13, 2006; Exhibit 10.3 therein) 
 
 10.4 
 Company Car Program, dated February 24, 1995 
 Registration Statement on Form S-1 No. 333-139295 (filed with the SEC on December 13, 2006; Exhibit 10.4 therein) 
 
 10.5 
 Executive Retirement Benefit Plan I, dated January 1, 2006 
 Registration Statement on Form S-1 No. 333-139295 (filed with the SEC on December 13, 2006; Exhibit 10.5 therein) 
 
 10.6 
 Benefit Equalization Plan, dated January 1, 2005 
 Registration Statement on Form S-1 No. 333-139295 (filed with the SEC on December 13, 2006; Exhibit 10.6 therein) 
 
 10.7 
 Split Dollar Agreement, dated January 29, 2002 
 Registration Statement on Form S-1 No. 333-139295 (filed with the SEC on December 13, 2006; Exhibit 10.7 therein) 
 
 10.8 
 Resolution Regarding Supplemental Split Dollar Life Insurance Plan, dated August 22, 2002 
 Registration Statement on Form S-1 No. 333-139295 (filed with the SEC on December 13, 2006; Exhibit 10.8 therein) 
 
 10.9 [Intentionally omitted] 
 
 10.10 
 TFS Financial Corporation Amended and Restated 2008 Equity Incentive Plan (incorporated by reference to Appendix B to the definitive proxy statement for the 2018 Annual Meeting of Stockholders) 
 Proxy Statement on Schedule 14A, No. 001-33390 (filed with the SEC on January 9, 2018) 
 
 10.11 
 TFS Financial Corporation Management Incentive Compensation Plan (incorporated by reference to Appendix A to the definitive proxy statement for the 2018 Annual Meeting of Stockholders) 
 Proxy Statement on Schedule 14A, No. 001-33390 (filed with the SEC on January 9, 2018) 

 126 

 Table of Contents 

 
 Exhibit 
 Number 
 Description of Exhibit If Incorporated by Reference, Documents with 
 Which Exhibit was Previous Filed with SEC 
 
 
 10.12 
 First Amendment to the Restricted Stock Unit Award Agreement (August 11, 2008 award), dated August 9, 2012 
 Current Report on Form 8-K No. 001-33390 (filed with the SEC on August 9, 2012; Exhibit 10.1 therein) 
 
 10.13 
 First Amendment to the Restricted Stock Unit Award Agreement (May 12, 2009 award), dated August 9, 2012 
 Current Report on Form 8-K No. 001-33390 (filed with the SEC on August 9, 2012; Exhibit 10.2 therein) 
 
 
 10.14 
 First Amendment to the Restricted Stock Unit Award Agreement (May 14, 2010 award), dated August 9, 2012 
 Current Report on Form 8-K No. 001-33390 (filed with the SEC on August 9, 2012; Exhibit 10.3 therein) 
 
 
 14 Code of Ethics Available on our website, www.thirdfederal.com 
 
 19 
 Insider trading policies and procedures 
 Current Report on Form 10-K No. 001-33390 (filed with the SEC on November 21, 2024; Exhibit 19 therein) 
 
 
 21.1 
 Subsidiaries of the registrant 
 Filed herewith 
 
 
 23.1 
 Consent of Independent Registered Public Accounting Firm 
 Filed herewith 
 
 31.1 
 Certification of chief executive officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934 
 Filed herewith 
 
 31.2 
 Certification of chief financial officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934 
 Filed herewith 
 
 32 
 Certification of chief executive officer and chief financial officer pursuant to Rule 13a-14(b) of the Securities Exchange Act of 1934 and 18 U.S.C. Section 1350 
 Filed herewith 
 
 97 
 Policy relating to recovery of erroneously awarded compensation 
 Current Report on Form 10-K No. 001-33390 (filed with the SEC on November 21, 2024; Exhibit 97 therein) 
 
 
 100 XBRL related documents The following financial statements from TFS Financial Corporation’s Annual Report on Form 10-K for the year ended September 30, 2025 filed on November 25, 2025 formatted in Inline XBRL (Extensible Business Reporting Language) includes: (i) Consolidated Statements of Condition, (ii) Consolidated Statements of Income, (iii) Consolidated Statements of Comprehensive Income, (iv) Consolidated Statements of Shareholders' Equity, (v) Consolidated Statements of Cash Flows, (vi) Notes to Consolidated Financial Statements. 
 
 101.INS Interactive datafile XBRL Instance Document 
 
 101.SCH Interactive datafile XBRL Taxonomy Extension Schema Document 
 
 101.CAL Interactive datafile XBRL Taxonomy Extension Calculation Linkbase Document 
 
 101.DEF Interactive datafile XBRL Taxonomy Extension Definition Linkbase Document 
 
 101.LAB Interactive datafile XBRL Taxonomy Extension Label Linkbase Document 
 
 101.PRE Interactive datafile XBRL Taxonomy Extension Presentation Linkbase Document 
 
 104 Interactive datafile Cover Page Interactive Datafile (embedded within the Inline XBRL document and included in Exhibit 101) 

 127 

 
 Table of Contents 

 SIGNATURES 
 Pursuant to the requirements of Section 13 or 15(d) the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. 
 
 
 TFS Financial Corporation 
 
 
 Dated: November 25, 2025 /S/ MARC A. STEFANSKI 
 Marc A. Stefanski
Chairman of the Board, President
and Chief Executive Officer
(Principal Executive Officer) 

 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated. 
 
 
 Dated: November 25, 2025 /S/ MARC A. STEFANSKI 
 Marc A. Stefanski
Chairman of the Board, President
and Chief Executive Officer
(Principal Executive Officer) 
 
 Dated: November 25, 2025 /S/ MEREDITH S. WEIL 
 Meredith S. Weil
Chief Financial Officer
(Principal Financial Officer) 
 
 Dated: November 25, 2025 /S/ SUSANNE N. MILLER 
 Susanne N. Miller
Chief Accounting Officer
(Principal Accounting Officer) 
 
 Dated: November 25, 2025 /S/ BARBARA J. ANDERSON 
 Barbara J. Anderson, Director 
 
 Dated: November 25, 2025 /S/ ANTHONY J. ASHER 
 Anthony J. Asher, Director 
 
 Dated: 
 November 25, 2025 /S/ TERRENCE L. BAUER 
 Terrence L. Bauer, Director 
 
 Dated: November 25, 2025 /S/ MARTIN J. COHEN 
 Martin J. Cohen, Director 
 
 Dated: November 25, 2025 /S/ ROBERT A. FIALA 
 Robert A. Fiala, Director 
 
 Dated: November 25, 2025 /S/ WILLIAM C. MULLIGAN 
 William C. Mulligan, Director 
 
 Dated: November 25, 2025 /S/ TERRENCE R. OZAN 
 Terrence R. Ozan, Director 
 
 Dated: November 25, 2025 /S/ JOHN P. RINGENBACH 
 John P. Ringenbach, Director 
 
 Dated: November 25, 2025 /S/ MEREDITH S. WEIL 
 Meredith S. Weil, Director 
 
 Dated: November 25, 2025 /S/ DANIEL F. WEIR 
 Daniel F. Weir, Director 
 
 Dated: November 25, 2025 /S/ ASHLEY H. WILLIAMS 
 Ashley H. Williams, Director 

 128
TFS Financial CORP 10-K

Item 9A. Controls and Procedures
