What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2024-02-29 compared with 2023-02-28 · 380 added, 489 removed, 2048 unchanged (30% of the section changed)

3 unchanged sentences

Consolidated Statements of Income

Consolidated Statements of Comprehensive Income

Consolidated Statements of Comprehensive Income (Loss)

Consolidated Statements of Financial Condition

5 unchanged sentences

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated statements of financial condition of WSFS Financial Corporation and subsidiaries (the Company) as of December 31, 2022 and 2021, , the related consolidated statements of income, comprehensive income, changes in stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2022, a, and the related notes (collectively, the consolidated financial statements).

We have audited the accompanying consolidated statements of financial condition of WSFS Financial Corporation and subsidiaries (the Company) as of December 31, 2023 and 2022, the related consolidated statements of income, comprehensive income (loss), changes in stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2023, and the related notes (collectively, the consolidated financial statements).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2023, in conformity with U.S.

17 unchanged sentences

Assessment of the Allowance for Credit Losses for Loans and Leases Evaluated on a Collective Basis

As discussed in Note 8 to the consolidated financial statements, the Company’s total allowance for credit losses as of December 31, 2022 was $151.9 million, of which $149.4 million related to the allowance for credit losses on loans and leases evaluated on a collective basis (the collective ACL).

As discussed in Footnotes 2 and 7 to the consolidated financial statements, the Company’s total allowance for credit losses as of December 31, 2023 was $186.1 million, of which $184.5 million related to the allowance for credit losses on loans and leases evaluated on a collective basis (the collective ACL).

The collective ACL includes the measure of expected credit losses on a collective (pooled) basis for those loans and leases that share similar risk characteristics.

2 unchanged sentences

The historical rate of credit loss is determined based on internally assessed risk ratings and loan segments and then adjusted for the economic forecast scenario and macroeconomic assumptions over reasonable and supportable forecast periods.

For the retail portfolio, the Company uses a base loss rate methodology which calculates historical loss rates based on average net loss rates over the LBP that incorporates the economic forecast assigned to that loan.

For the retail and leasing portfolios, the Company uses a base loss rate methodology which calculates historical loss rates based on average net loss rates over the LBP that incorporates the economic forecast assigned to that loan.

After the reasonable and supportable forecast periods, the Company reverts on a straight-line basis over the reversion period to its historical loss rates, evaluated over the LBP, for the remaining life of both commercial and retail loans and leases.

14 unchanged sentences

• identification and determination of the significant assumptions used in the quantitative model

• development of certain qualitative factors

• application of certain qualitative factors

• analysis of the collective ACL results, trends, and ratios.

47 unchanged sentences

Unrealized gains on equity investments, net 329 5,980 5,141

Realized (loss) gain on sale of equity investment, net — ( 706 ) 22,052

Realized gain (loss) on sale of equity investment, net 9,493 — ( 706 )

Bank owned life insurance income 4,642 1,804 1,251

19 unchanged sentences

Net income $ 269,025 $ 222,648 $ 271,605

Net income (loss) attributable to noncontrolling interest 273 163 ( 1,454 )

Net (loss) income attributable to noncontrolling interest ( 131 ) 273 163

Net income attributable to WSFS $ 269,156 $ 222,375 $ 271,442

4 unchanged sentences

The accompanying notes are an integral part of these Consolidated Financial Statements

CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME(LOSS)

Year Ended December 31,

1 unchanged sentence

Net income $ 269,025 $ 222,648 $ 271,605

Net gain (loss) attributable to noncontrolling interest 273 163 ( 1,454 )

Net (loss) gain attributable to noncontrolling interest ( 131 ) 273 163

Net income attributable to WSFS $ 269,156 $ 222,375 $ 271,442

Other comprehensive (loss) income:

Net change in unrealized (losses) gains on investment securities available-for-sale

Net unrealized (losses) gains arising during the period, net of tax (benefit) expense of $( 167,261 ), $( 29,523 ), and $ 12,585 , respectively

Other comprehensive income (loss):

Net change in unrealized gains (losses) on investment securities available-for-sale

Net unrealized gains (losses) arising during the period, net of tax expense (benefit) of $ 20,085 , $( 167,261 ), and $( 29,523 ), respectively

63,601 ( 529,660 ) ( 93,503 )

1 unchanged sentence

63,601 ( 529,660 ) ( 93,755 )

( 529,660 ) ( 93,755 ) 32,955

Net change in securities held-to-maturity

Net change in unrealized losses on securities reclassified to held-to-maturity, net of tax expense of $ 34,319 , $ 32 , and $ 60 , respectively (1)(2)

Net change in unrealized gains (losses) on securities reclassified to held-to-maturity, net of tax (benefit) expense of $( 5,361 ), $ 34,319 , and $ 32 , respectively (1)(2)

16,980 ( 108,678 ) ( 101 )

Net change in unfunded pension liability

Change in unfunded pension liability related to unrealized gain (loss), prior service cost and transition obligation, net of tax (benefit) expense of $( 5 ), $ 50 , and $( 585 ), respectively

209 97 ( 1,683 )

Pension settlement, net of tax expense of $ — , $ — and $ 67 , respectively

Change in unfunded pension liability related to unrealized (loss) gain and prior service cost, net of tax expense (benefit) of $ 1 , $( 5 ), and $ 50 , respectively

( 132 ) 209 97

6 unchanged sentences

Net change in equity method investments

Net change in other comprehensive income (loss) of equity method investments, net of tax expense (benefit) of $ 67 , $ 114 , and $( 3 ), respectively

Net change in other comprehensive (loss) income of equity method investments, net of tax (benefit) expense of $( 27 ), $ 67 , and $ 114 , respectively

( 85 ) 213 362

Total other comprehensive (loss) income ( 638,076 ) ( 93,775 ) 32,506

Total comprehensive (loss) income $ ( 415,701 ) $ 177,667 $ 147,280

(1) Includes $ 119.8 million, net of tax benefit, of unrealized losses on transferred investment securities with a book value of $ 1.1 billion from available-for-sale to held-to-maturity for the year ended December 31, 2022 .

Total other comprehensive income (loss) 81,853 ( 638,076 ) ( 93,775 )

Total comprehensive income (loss) $ 351,009 $ ( 415,701 ) $ 177,667

(2) Includes amortization of unrealized gains and losses on securities reclassified to held-to-maturity.

38 unchanged sentences

Capital in excess of par value 1,984,746 1,974,210

Accumulated other comprehensive (loss) income ( 675,844 ) ( 37,768 )

Accumulated other comprehensive loss ( 593,991 ) ( 675,844 )

Retained earnings 1,643,657 1,411,243

16 unchanged sentences

Balance, December 31, 2020 57,575,783 $ 576 $ 1,053,022 $ 56,007 $ 977,414 $ ( 295,293 ) $ 1,791,726 $ ( 2,246 ) $ 1,789,480

Cumulative change in

accounting principle — — — — ( 30,368 ) — ( 30,368 ) — ( 30,368 )

Balance, January 1, 2020 (as adjusted for change in accounting principle) 57,435,658 575 1,049,064 23,501 887,009 ( 140,211 ) 1,819,938 ( 815 ) 1,819,123

Net income (loss) — — — — 114,774 — 114,774 ( 1,454 ) 113,320

Other comprehensive income — — — 32,506 — — 32,506 — 32,506

Net income — — — — 271,442 — 271,442 163 271,605

Other comprehensive loss — — — ( 93,775 ) — — ( 93,775 ) — ( 93,775 )

Cash dividend, $ 0.51 per share

2 unchanged sentences

options 119,893 1 1,521 — — — 1,522 — 1,522

Contributions from noncontrolling shareholders — — — — — — — 23 23

Stock-based compensation expense — — 5,694 — — — 5,694 — 5,694

6 unchanged sentences

— — — — ( 35,746 ) — ( 35,746 ) — ( 35,746 )

Distributions to noncontrolling shareholders — — — — — — — ( 504 ) ( 504 )

Issuance of common stock including proceeds from exercise of common stock options 109,473 1 3,178 — — — 3,179 — 3,179

Issuance of common stock in acquisition of BMT 18,116,848 181 907,835 — — — 908,016 — 908,016

Noncontrolling interest assumed in acquisition — — — — — — — ( 913 ) ( 913 )

Stock-based compensation expense — — 6,349 — — — 6,349 — 6,349

3 unchanged sentences

Net income — — — — 269,156 — 269,156 ( 131 ) 269,025

Other comprehensive loss — — — ( 638,076 ) — — ( 638,076 ) — ( 638,076 )

Other comprehensive income — — — 81,853 — — 81,853 — 81,853

Cash dividend, $ 0.60 per share

— — — — ( 36,742 ) — ( 36,742 ) — ( 36,742 )

Contributions from noncontrolling shareholders — — — — — — — ( 504 ) ( 504 )

Distributions to noncontrolling shareholders — — — — — — — ( 4,463 ) ( 4,463 )

Issuance of common stock including proceeds from exercise of common stock options 173,097 2 3,296 — — — 3,298 — 3,298

Issuance of common stock in acquisition of BMT 18,116,848 181 907,835 — — — 908,016 — 908,016

Noncontrolling interest assumed in acquisition — — — — — — — ( 913 ) ( 913 )

Stock-based compensation expense — — 9,605 — — — 9,605 — 9,605

18 unchanged sentences

Gain on sale of securities, net — — ( 331 )

Gain on sale of other real estate owned and valuation adjustments, net ( 221 ) ( 385 ) ( 25 )

Loss (gain) on sale of other real estate owned and valuation adjustments, net 195 ( 221 ) ( 385 )

Stock-based compensation expense 9,605 6,349 5,694

Unrealized gains on equity investments, net ( 329 ) ( 5,980 ) ( 5,141 )

Realized loss (gain) on sale of equity investment, net — 706 ( 22,052 )

Realized (gain) loss on sale of equity investment, net ( 9,493 ) — 706

Deferred income tax (benefit) expense ( 5,397 ) ( 4,005 ) 39,838

4 unchanged sentences

Increase (decrease) in accrued interest payable 41,510 1,196 ( 714 )

Increase (decrease) in other liabilities 315,065 ( 4,807 ) 24,675

Increase in value of bank-owned life insurance ( 1,311 ) ( 1,048 ) ( 1,757 )

(Decrease) increase in other liabilities ( 60,781 ) 315,065 ( 4,807 )

Decrease (increase) in value of bank-owned life insurance ( 2,053 ) ( 1,311 ) ( 1,048 )

Increase in capitalized interest, net ( 1,738 ) ( 2,078 ) ( 3,014 )

7 unchanged sentences

Proceeds from bank-owned life insurance death benefit 3,772 1,437 —

Proceeds from bank-owned life insurance surrender 51,981 — —

Net proceeds from sale of equity investments 17,946 — 4,899

Net cash from business combinations 573,745 — —

Net cash (paid for) from business combinations ( 3,000 ) 573,745 —

Net (increase) decrease in loans and leases ( 486,819 ) ( 41,324 ) 1,453,471

12 unchanged sentences

Net (decrease) increase in demand and saving deposits $ ( 358,115 ) $ ( 1,123,468 ) $ 1,760,031

Decrease in time deposits ( 94,251 ) ( 169,871 ) ( 197,765 )

Increase (decrease) in brokered deposits 61,705 ( 202,625 ) ( 29,474 )

Increase (decrease) in time deposits 681,484 ( 94,251 ) ( 169,871 )

(Decrease) increase in brokered deposits ( 70,915 ) 61,705 ( 202,625 )

Receipts from FHLB advances 7,195,000 1,873,100 1,000

2 unchanged sentences

Repayments of federal funds purchased ( 7,713,000 ) ( 2,730,001 ) —

Contribution from noncontrolling shareholders ( 504 ) — 23

Receipts from Bank Term Funding Program 565,000 — —

Distributions to noncontrolling shareholders ( 4,463 ) ( 504 ) —

Cash dividend ( 36,742 ) ( 35,746 ) ( 24,242 )

Issuance of common stock and exercise of common stock options 3,298 3,179 1,522

Redemption of senior debt — ( 100,000 ) —

Issuance of senior debt, net of costs — — 147,780

Redemption of senior and subordinated debt ( 30,000 ) — ( 100,000 )

Repurchase of common shares ( 54,647 ) ( 200,083 ) ( 13,268 )

Net cash (used in) provided by financing activities $ ( 1,039,168 ) $ 1,244,924 $ 1,942,785

(Decrease) increase in cash, cash equivalents, and restricted cash $ ( 695,681 ) $ ( 121,796 ) $ 1,082,983

Net cash provided by (used in) financing activities $ 344,900 $ ( 1,039,168 ) $ 1,244,924

Increase (decrease) in cash, cash equivalents, and restricted cash $ 255,642 $ ( 695,681 ) $ ( 121,796 )

Cash, cash equivalents, and restricted cash at beginning of period 837,258 1,532,939 1,654,735

8 unchanged sentences

Available-for-sale securities purchased, not settled — — 34,489

Receivable for bank-owned life insurance surrender proceeds 4,731 — —

Receivable for bank-owned life insurance death benefit proceeds 742 — —

Fair value of assets acquired, net of cash received 7,993 4,713,544 —

Fair value of liabilities assumed 4,993 4,379,273 —

Impact of ASC 326 Adoption:

Allowance for credit losses on held-to-maturity debt securities — — ( 8 )

Allowance for credit losses on loans and leases — — ( 35,855 )

Deferred tax assets — — 8,461

Allowance for credit losses on unfunded lending commitments — — ( 2,966 )

Retained earnings — — 30,368

The accompanying notes are an integral part of these Consolidated Financial Statements

3 unchanged sentences

Substantially all of the Company's assets are held by its subsidiary, Wilmington Savings Fund Society, FSB (WSFS Bank or the Bank), is a federal savings bank organized under the laws of the United States (U.S.).

The Consolidated Financial Statements include the accounts of the Company, WSFS Bank, WSFS Wealth Management, LLC (Powdermill ® ), WSFS Capital Management, LLC (West Capital), Cypress Capital Management, LLC (Cypress), WSFS SPE Services, LLC, The Bryn Mawr Trust Company of Delaware (BMT-DE), and 601 Perkasie, LLC.

The Consolidated Financial Statements include the accounts of the Company, WSFS Bank, The Bryn Mawr Trust Company of Delaware (BMT-DE), Bryn Mawr Capital Management, LLC (BMCM), WSFS Wealth Management, LLC (Powdermill ® ), WSFS SPE Services, LLC, and 601 Perkasie, LLC.

The Company also has three unconsolidated subsidiaries, WSFS Capital Trust III (the Trust), Royal Bancshares Capital Trust I, and Royal Bancshares Capital Trust II .

1 unchanged sentence

Beneficial Equipment Finance Corporation (BEFC) and 1832 Holdings, Inc., and one majority-owned subsidiary, NewLane Finance Company (NewLane Finance ® ).

Additionally, WSFS and the Bank acquired certain subsidiaries in the merger of Bryn Mawr Bank Corporation (BMBC) with and into WSFS on January 1, 2022, and the merger of The Bryn Mawr Trust Company with and into the Bank (collectively, the BMBC Merger), pursuant to the agreement and plan of merger, by and between WSFS and BMBC, dated as of March 9, 2021 (the BMBC Merger Agreement) that are not named herein as they are not integral or significant to our business.

On April 1, 2022, WSFS completed the merger of Christiana Trust Company of Delaware ® and BMT-DE.

The combined organization will retain and operate under The Bryn Mawr Trust Company of Delaware name.

Additionally on April 1, 2022, Bryn Mawr Equipment Finance, Inc.

merged with and into BEFC.

On April 29, 2022, the portfolio of KCMI Capital, Inc.

(KCMI), a specialized commercial lending unit acquired in the BMBC merger and not core to our overall lending strategy, was sold at par value for $ 55.5 million .

Finally, on June 30, 2022, the business of BMT Insurance Advisors (BMTIA), was sold to Patriot Growth Services, LLC.

On January 1, 2023, WSFS completed the merger and brand conversion of West Capital and Cypress and has renamed the combined entity Bryn Mawr Capital Management, LLC.

Bryn Mawr Capital Management, LLC is registered as an investment advisor with the U.S.

Securities and Exchange Commission and is a wholly-owned subsidiary of WSFS.

Founded in 1832, the Bank is one of the ten oldest bank and trust companies continuously operating under the same name in the U.S.

The Company provides residential and commercial mortgage, commercial and consumer lending services, as well as retail deposit and cash management services.

The Company provides residential and commercial mortgage, commercial and consumer lending services, as well as retail deposit and treasury management services.

The Company's core banking business is commercial lending funded primarily by customer-generated deposits.

1 unchanged sentence

The Federal Deposit Insurance Corporation (FDIC) insures the Company's customers’ deposits to their legal maximums.

The Company serves its Customers primarily from 119 offices located in Pennsylvania ( 61 ), Delaware ( 39 ), New Jersey ( 17 ), Virginia ( 1 ), and Nevada ( 1 ), its ATM network, website at www.wsfsbank.com , and mobile apps.

The Company serves its Customers primarily from 114 offices located in Pennsylvania ( 57 ), Delaware ( 40 ) , New Jersey ( 14 ), Florida ( 1 ), Nevada ( 1 ) and Virginia ( 1 ) , its ATM network, website at www.wsfsbank.com , and mobile app.

Information on the Company's website is not incorporated by reference into this Annual Report on Form 10-K.

8 unchanged sentences

Among other effects, changes to these estimates could result in future impairments of investment securities, goodwill and intangible assets, the establishment of additional allowance and lending-related commitment reserves, changes in the fair value of financial instruments, as well as increased post-retirement benefits and income tax expense.

Certain reclassifications have been made to the prior year’s Consolidated Financial Statements to conform to the current year’s presentation.

All significant intercompany accounts and transactions were eliminated in consolidation.

2 unchanged sentences

Cash, Cash Equivalents and Restricted Cash

For purposes of reporting cash flows, cash, cash equivalents and restricted cash include cash, cash in non-owned ATMs, amounts due from banks, federal funds sold and securities purchased under agreements to resell and cash collateral held for a financial derivative related to the sale of certain Visa Class B shares.

For purposes of reporting cash flows, cash, cash equivalents and restricted cash include cash, cash in non-owned ATMs, amounts due from banks, federal funds sold and securities purchased under agreements to resell and cash collateral held for derivatives, including a financial derivative related to the sale of certain Visa Class B shares.

Debt Securities

18 unchanged sentences

The Company classifies the held-to-maturity debt securities into the following major security types:

state and political subdivisions, and foreign bonds.

mortgage backed securities, state and political subdivisions, and foreign bonds.

These securities are highly rated with a history of no credit losses, and are assigned ratings based on the most recent data from ratings agencies depending on the availability of data for the security.

21 unchanged sentences

Any dividends received are recorded in interest income.

The fair value of equity investments with readily determinable fair values is primarily obtained from third-party pricing services.

For equity investments without readily determinable fair values, when an orderly transaction for the identical or similar investment of the same issuer is identified, the Company uses valuation techniques permitted under ASC 820, Fair Value Measurement, to evaluate the observed transaction(s) and adjust the carrying value.

22 unchanged sentences

Subsequent cash receipts are applied either to the outstanding principal balance or recorded as interest income, depending on the Company’s assessment of the ultimate collectability of principal and interest.

Loans are returned to accrual status when the Company assesses that the borrower has the ability to make all principal and interest payments in accordance with the terms of the loan (i.e.

a consistent repayment record, generally six consecutive payments, has been demonstrated).

Unless loans are well-secured and collection is imminent, for loans greater than 90 days past due their respective reserves are generally charged off once the loss has been confirmed.

Loans are returned to accrual status when the Company assesses that the borrower has the ability to make all principal and interest payments in accordance with the terms of the loan (i.e., a consistent repayment record, generally six consecutive payments, has been demonstrated).

For loans greater than 90 days past due, unless loans are well-secured and collection is imminent, their respective reserves are generally charged off once the loss has been confirmed.

Expected recoveries do not exceed the aggregate of amounts previously charged off and expected to be charged off.

A loan, for which the terms have been modified resulting in a concession to the borrower experiencing financial difficulty, is considered a TDR.

Principal balances are generally not forgiven when a loan is modified as a TDR.

Nonaccruing restructured loans remain in nonaccrual status until there has been a period of sustained repayment performance demonstrated, as noted above, and repayment is reasonably assured.

A loan, for which the terms have been modified in the current reporting period in the form of principal forgiveness, an interest rate reduction, an other than-insignificant payment delay, or a term extension to a borrower experiencing financial difficulty, is considered a troubled loan.

The assessment of whether a borrower is experiencing financial difficulty is made on the date of a modification.

Principal balances are generally not forgiven when a loan is modified as a troubled loan.

Nonaccruing troubled loans remain in nonaccrual status until there has been a period of sustained repayment performance demonstrated and repayment is reasonably assured.

Since the effect of most troubled loans are already included in the Company’s estimate of expected credit losses, a change to the allowance for credit losses is generally not recorded upon modification.

For additional detail regarding past due and nonaccrual loans, see Note 7.

3 unchanged sentences

The Company's portfolio segments, established based on similar risk characteristics and loss behaviors, are:

• Commercial and industrial - real estate secured, commercial and industrial - non-real estate secured, owner-occupied commercial, commercial mortgages, construction and commercial small business leases (collectively, commercial loans), and

• Residential, equity secured lines and loans, installment loans, unsecured lines of credit, originated education loans and previously acquired education loans (collectively, retail loans).

• Commercial Loans and Leases:

Commercial and industrial - real estate secured, commercial and industrial - non-real estate secured, owner-occupied commercial, commercial mortgages, construction and commercial small business leases, and

• Residential and Consumer Loans:

Residential mortgage, equity secured lines and loans, installment loans, unsecured lines of credit, originated education loans and previously acquired education loans.

Expected credit losses are net of expected recoveries and estimated over the contractual term, adjusted for expected prepayments.

The contractual term excludes any extensions, renewals and modifications unless the Company has reasonable expectations at the reporting date that it will result in a troubled debt restructuring (TDR) or they are not unconditionally cancellable.

The contractual term excludes any extensions, renewals and modifications unless they are not unconditionally cancellable.

Expected recoveries do not exceed the aggregate of amounts previously charged-off and expected to be charged-off.

3 unchanged sentences

Loans that share similar risk characteristics are collectively reviewed for credit loss and are evaluated based on historical loss experience, adjusted for current economic conditions and future economic forecasts.

Estimated losses are determined differently for commercial and retail loans, and each portfolio segment is further segmented by internally assessed risk ratings.

Estimated losses are determined differently for commercial and residential and consumer loans, and each commercial segment is further segmented by internally assessed risk ratings.

The Company uses a single scenario third-party economic forecast to adjust the calculated historical loss rates of the portfolio segments to incorporate the effects of current and future economic conditions.

4 unchanged sentences

The probability of default is calculated based on the historical rate of migration to an event of credit loss during the look-back period.

The historical loss rates for retail loans is calculated based on average net loss rates over the same look-back period.

The historical loss rates for consumer loans are calculated based on average net loss rates over the same look-back period.

The current look-back period is 52 quarters which ensures historical loss rates are adequately considering losses within a full credit cycle.

Loans that do not share similar risk characteristics with any loan segments are evaluated on an individual basis.

These loans, which may include TDRs, are not included in the collective basis evaluation.

These loans, which may include troubled loans, are not included in the collective basis evaluation.

When it is probable the Company will not collect all principal and interest due according to their contractual terms, which is assessed based on the credit characteristics of the loan and/or payment status, these loans are individually reviewed and measured for potential credit loss.

4 unchanged sentences

If the measured fair value of the loan is less than the amortized cost basis of the loan, an allowance for credit loss is recorded.

For collateral dependent loans, the expected credit losses at the individual asset level is the difference between the collateral's fair value (less cost to sell) and the amortized cost.

For collateral dependent loans, the expected credit losses at the individual asset level are the difference between the collateral's fair value (less cost to sell) and the amortized cost.

Qualitative adjustment factors consider various internal and external conditions which are allocated among loan segments and take into consideration:

• Current underwriting policies, staff and portfolio concentrations,

• Risk rating accuracy, credit and administration,

• Current underwriting policies, staffing and portfolio concentrations,

• Risk rating accuracy and credit administration,

• Internal risk emergence (including internal trends of delinquency, and criticized loans by segment),

5 unchanged sentences

In addition, various regulatory agencies periodically review the Company's loan ratings and allowance for credit losses and the Bank's internal loan review department performs recurring loan reviews.

Accrued interest receivable on loans is excluded from the estimate of credit losses and is included in Accrued interest receivable on the Consolidated Statements of Financial Condition.

Accrued interest receivable on loans is excluded from the estimate of credit losses and is included in Accrued interest receivable on the unaudited Consolidated Statements of Financial Condition.

For additional detail regarding the allowance for credit losses and the provision for credit losses, see Note 7.

78 unchanged sentences

The following accounting pronouncements were adopted by the Company during the year ended December 31, 2023, but do not have a material impact on the Consolidated Financial Statements:

2021-05, Leases (Topic 842), Lessors – Certain Leases with Variable Lease Payments:

In July 2021, the FASB issued ASU 2021-0 5 to amend ASC 842 to clarify the classification of certain leases with variable lease payments for lessors.

2022-06, Reference Rate Reform (Topic 848):

Deferral of the Sunset Date of Topic 848:

In December 2022, the FASB issued ASU No.

2022-06 which extended the period of time to ease the reference rate reform transition period to through December 31, 2024.

This pronouncement supersedes the original transition period end date as referenced in ASU No.

2020-04, Reference Rate Reform (Topic 848):

Facilitation of the Effects of Reference Rate Reform on Financial Reporting .

Accounting Guidance Pending Adoption as of December 31, 2022

2022-02, Financial Instruments – Credit Losses (Topic 326):

3 unchanged sentences

Troubled Debt Restructurings and Vintage Disclosures.

The guidance eliminates the accounting guidance for troubled debt restructurings (TDRs) by creditors (ASC 310-40) while enhancing disclosure requirements for certain loan refinancings and restructurings by creditors when a borrower is experiencing financial difficulty.

The guidance eliminates the accounting guidance for troubled debt restructurings by creditors (ASC 310-40) while enhancing disclosure requirements for certain loan refinancings and restructurings by creditors when a borrower is experiencing financial difficulty.

The guidance also requires that an entity disclose current-period write-offs by year of origination for financing receivables and net investments in leases within the scope of Topic 326.

The guidance is effective for annual periods beginning after December 15, 2022, which will be applicable to the Company in the first quarter of 2023.

Adoption is required on a prospective basis, except for the transition method related to the recognition and measurement of TDRs where the entity has to apply on a modified-retrospective basis.

BUSINESS COMBINATIONS

Bryn Mawr Bank Corporation.

On January 1, 2022, WSFS closed its acquisition of BMBC and acquired 100 % of the outstanding common stock of BMBC.

In accordance with the terms of the merger agreement, dated March 9, 2021, by and between WSFS and BMBC, each share of BMBC common stock was exchanged for 0.90 shares of WSFS common stock (with cash paid in lieu of fractional shares).

The total value of consideration paid was $ 908.0 million based on 19,903,230 shares of BMBC common stock outstanding as of December 31, 2021, the vesting of 226,643 BMBC restricted stock awards, and the closing price per share of WSFS common stock of $ 50.12 on December 31, 2021.

Results of the combined Company’s operations are included in the Consolidated Financial Statements since the date of the acquisition.

BMBC was the holding company for The Bryn Mawr Trust Company (Bryn Mawr Bank), a Pennsylvania chartered bank and wholly-owned subsidiary.

BMBC and Bryn Mawr Bank were headquartered in Bryn Mawr, Pennsylvania, a western suburb of Philadelphia, and served primarily the Greater Philadelphia region.

BMBC and its direct and indirect subsidiaries was a locally managed, premier financial services company providing retail and commercial banking;

trust administration and wealth management;

and insurance and risk management solutions.

Following the BMBC Merger, WSFS Bank is the oldest and largest, locally headquartered bank and trust company in the Greater Philadelphia and Delaware region with a full-service product suite and a balance sheet to compete with larger regional and national banks.

The BMBC Merger also allows WSFS to accelerate our long-term strategic objectives, including scale to continue to invest in our delivery and talent transformations.

The acquisition of BMBC was accounted for as a business combination using the acquisition method of accounting and, accordingly, the assets acquired, liabilities assumed and consideration transferred were recorded at their estimated fair values as of the acquisition date.

The excess of consideration transferred over the fair value of net assets acquired was recorded as goodwill, which is not amortizable nor deductible for tax purposes.

The Company allocated goodwill to its WSFS Bank segment and Wealth Management segment.

The following table summarizes the consideration transferred and the fair values of identifiable assets acquired and liabilities assumed and is considered final:

(Dollars in thousands)

Consideration Transferred:

Common shares issued ( 18,116,848 )

Cash paid to BMBC stock and option holders 16

Value of consideration 908,032

Assets acquired:

Cash and due from banks 573,761

Investment securities 500,400

Loans and leases, net 3,456,748

Premises and equipment 44,842

Deferred income taxes 6,563

Bank owned life insurance 67,525

Intangible assets 73,065

Other assets 153,592

Total assets 4,876,496

Liabilities assumed:

Deposits 4,110,122

Other borrowings 145,512

Other liabilities 124,552

Noncontrolling interest ( 913 )

Total liabilities and noncontrolling interest 4,379,273

Net assets acquired:

Goodwill resulting from acquisition of BMBC $ 410,809

The following table details the changes to goodwill recorded subsequent to acquisition:

(Dollars in thousands) Fair Value

Goodwill resulting from the acquisition of BMBC as of January 1, 2022 $ 414,337

Effects of adjustments to:

Deferred income taxes 1,870

Intangibles 1,500

Deposits ( 149 )

Other liabilities 1,352

Effect of sale of BMTIA business ( 8,101 )

Goodwill resulting from the acquisition of BMBC as of December 31, 2022

Adjustments to Goodwill were primarily related to the fair value of Wealth Management intangible assets, the subsequent sale of the BMTIA business, and the related deferred tax impacts.

Fair value estimates related to the assets and liabilities from BMBC are subject to adjustment for up to one year after the closing date of the acquisition as additional information becomes available.

Changes to the preliminary valuation of acquired assets and liabilities were recognized as adjustments to identified intangibles and goodwill.

All remeasurement adjustments were completed prior to the expiration of the remeasurement period on December 31, 2022, one year after the closing date.

The amount of goodwill recorded reflects the increased market share and related synergies that are expected to result from the acquisition, and represents the excess purchase price over the estimated fair value of the net assets acquired from BMBC.

The following is a description of the valuation methodologies used to estimate the fair values of major categories of assets acquired and liabilities assumed.

In many cases, the fair values of the assets acquired and liabilities assumed were determined by estimating the cash flows expected to result from those assets and liabilities and applying the appropriate market discount rates.

Cash and due from banks :

The estimated fair values of cash and due from banks approximate their stated value.

Investment Securities :

The acquired investment portfolio had a fair value of $ 500.4 million, primarily consisting of short-term U.S.

Treasury bills that matured subsequent to closing on January 6, 2022.

The estimated fair value approximated the stated value at maturity.

Loans and Leases :

The Company recorded $ 3.5 billion of acquired loans, which were initially recorded at their fair values as of the acquisition date.

Fair value for loans was based on a discounted cash flow methodology that considered credit loss and prepayment expectations, market interest rates and other market factors, such as liquidity, from the perspective of a market participant.

Loan cash flows were generated on an individual loan basis.

The probability of default, loss given default, exposure at default and prepayment assumptions are the key factors driving credit losses which are embedded into the estimated cash flows.

The table below presents information with respect to the fair value and unpaid principal balance of acquired loans and leases at the acquisition date.

January 1, 2022

(Dollars in thousands) Book Balance Fair Value

Commercial and industrial $ 613,197 $ 586,643

Owner-occupied commercial 513,267 503,182

Commercial mortgages 1,564,234 1,549,515

Construction 209,928 208,288

Commercial small business leases 125,770 119,119

310,092 315,454

Consumer 178,247 174,547

Total acquired loans and leases $ 3,514,735 $ 3,456,748

The table below presents the carrying amount of loans for which, at the date of acquisition, there was evidence of more than insignificant deterioration of credit quality since origination:

(Dollars in thousands) January 1, 2022

Book balance of loans at acquisition $ 235,791

Allowance for credit losses at acquisition ( 26,103 )

Non-credit related discount ( 1,421 )

Total purchase credit deteriorated (PCD) loans acquired $ 208,267

The BMBC Merger resulted in the addition of $ 49.6 million in allowance for credit losses, including the $ 26.1 million identified in the table above for PCD loans, and $ 23.5 million for non-PCD loans recorded through the provision for credit losses at the date of acquisition.

Deferred Income Taxes :

The Company recorded a deferred income tax asset (DTA) of $ 6.6 million related to tax attributes of BMBC along with the effects of fair value adjustments resulting from acquisition accounting for the combination.

The DTA’s recorded were based on the expected federal and state tax benefits of when the acquired tax attributes and purchase accounting adjustments will reverse.

In recording the DTA, consideration was given to potential limitations on the realizability of such acquired tax attributes.

There was no material change to the valuation allowance as a result of the BMBC Merger.

Trust preferred borrowings and subordinated debt :

The fair value of trust preferred borrowings and subordinated debt were determined by present valuing the expected cash flows using current market rates for similar instruments.

A fair value discount of $ 2.5 million was recognized for the trust preferred borrowings and will be recognized as an increase to interest expense over the remaining life of the borrowings.

A fair value premium of $ 0.7 million was recognized for the subordinated debt and will be recognized as a decrease to interest expense over the remaining life of the debt.

Intangible Assets :

The Company recorded $ 10.9 million of core deposit intangible (CDI) which is being amortized over ten years using a straight-line amortization methodology.

The fair value of the core deposit intangible was determined using the cost savings approach.

The cost savings approach is defined as the difference between cost of funds on deposits and the cost of an equal amount of funds from an alternative source.

The CDI fair value was determined by projecting net cash flow benefits, including assumptions related to customer attrition, discount rates, deposit interest rates, and alternative costs of funds.

Certificates of deposit accounts were valued by segregating the portfolio into pools based on remaining maturity and comparing the contractual cost of the portfolio to an identical portfolio bearing current market rates.

The valuation adjustment will be accreted or amortized to interest expense over the remaining maturities of the respective pools.

WSFS recorded $ 56.1 million of Wealth Management intangible assets that consisted of $ 53.0 million for customer relationships in our wealth management, trust and insurances lines of business, $ 2.9 million for the Bryn Mawr Trust tradename, and $ 0.2 million in non-compete agreements.

Fair value for these Wealth Management intangible assets was based on a discounted cash flow methodology projecting net cash flow benefits, including assumptions related to customer attrition, discount rates, income projections and applicable growth rate assumptions.

Corporate development expenses and Restructuring expenses

For acquisitions, the Company develops comprehensive integration plans under which it has incurred direct costs, which are expensed as incurred.

These direct costs include costs that are primarily related to:

(i) terminated contracts, (ii) consolidated facilities (including lease termination expenses), (iii) severance, (iv) marketing, and (v) professional and legal fees.

Costs related to the acquisition and restructuring are included in the Corporate development expense and Restructuring expense line items, respectively, on the Consolidated Statements of Income.

The following table details the costs identified and classified as corporate development and restructuring expenses, which are primarily related to the BMBC Merger:

Twelve months ended December 31,

(dollars in thousands) 2022

Salaries, benefits and other compensation $ 12,541

Occupancy expense 9,356

Equipment expense 20,950

Professional fees 13,025

Data processing and operations expenses 121

Marketing expense 3,133

Other operating expense, net 6,097

Total corporate development and restructuring expenses $ 65,223

During the second quarter of 2021, WSFS announced a retail banking office optimization plan that included the planned consolidation of Bryn Mawr Trust and WSFS Bank banking offices.

Most of the consolidations and rebranding of the banking offices were completed during the first quarter of 2022, which included the consolidation of 22 Bryn Mawr Trust and 12 WSFS Bank banking offices.

Costs related to this plan are included in the Corporate development expense line item on the Consolidated Statements of Income.

In addition, the Company had $ 7.5 million of premises and equipment as held-for-sale as of December 31, 2022, which is included in the Other assets line item on the Consolidated Statement of Financial Condition.

Pro Forma Income Statement (unaudited)

The following pro forma income statement for the twelve months ended December 31, 2021 presents the pro forma results of operations of the combined institution (BMBC and the Corporation) as if the BMBC Merger occurred on January 1, 2021.

The pro forma income statement adjustments are limited to the effects of fair value mark amortization and accretion and intangible asset amortization.

No cost savings or additional merger expenses have been included in the pro forma results of operations.

Twelve months ended December 31,

(dollars in thousands, except share and per share data) 2021

Net interest income $ 567,183

(Recovery of) provision for credit losses ( 115,212 )

Net interest income after provision for credit losses 682,395

Total noninterest income 271,576

Total noninterest expenses 556,524

Income before income taxes 397,447

Income tax provision 100,009

Net income $ 297,438

Per share data:

Weighted-average basic shares outstanding 65,445,251

Dilutive shares 332,765

Adjusted weighted-average diluted shares 65,778,016

Basic earnings per common share $ 4.54

Diluted earnings per common share $ 4.52

Due to the various conversions of BMBC systems since the date of acquisition, as well as other streamlining and continuing integration of BMBC's operating activities into those of the Company, reporting for revenue and net income of the former BMBC operations for the period subsequent to the acquisition is impracticable.

The Company adopted this guidance prospectively on January 1, 2023.

For further details on the impact of the adoption and accounting policies, see updated Significant Accounting Policies, as described above, and troubled loans disclosures in Note 7 - Allowance for Credit Losses and Credit Quality Information .

Accounting Guidance Pending Adoption as of December 31, 2023

2023-01, Leases (Topic 842:) Common Control Agreements :

In March 2023, the FASB issued ASU No.

2023-01, Leases (Topic 842) Common Control Agreements.

The amendment clarifies the accounting for leasehold improvements associated with common control leases by allowing the lessee to amortize the leasehold improvements over the useful life of the common control group’s use of the underlying asset, regardless of the lease term.

The guidance is effective for fiscal years beginning after December 15, 2023.

Early adoption is permitted.

Adoption is required on a modified retrospective basis, consistent with the Company's adoption of Topic 842.

The Company does not expect this update to have a material impact on the Consolidated Financial Statements.

2023-02, Investments—Equity Method and Joint Ventures (Topic 323):

Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method:

In March 2023, The FASB issued ASU 2023-02, Investments—Equity Method and Joint Ventures (Topic 323) Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method.

The amendments permit reporting entities to elect to account for any equity investments in a tax credit program using the proportional amortization method if certain conditions are met.

The amendments are effective for fiscal years beginning after December 15, 2023.

Early adoption is permitted.

Adoption is required on a prospective, modified retrospective, or retrospective basis depending on the amendment.

The Company does not expect this update to have a material impact on the Consolidated Financial Statements.

2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures:

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures.

The amendments are intended to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss.

The amendments are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

Early adoption is permitted.

Adoption is required retrospectively to all prior periods presented in the financial statements.

The Company is currently evaluating this update to determine the impact on the Company’s disclosures.

2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures:

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures.

The amendments further enhance income tax disclosures, primarily through standardization and disaggregation of rate reconciliation categories and income taxes paid by jurisdiction.

The amendments are effective for fiscal years beginning after December 15, 2024, and interim periods within fiscal years beginning after December 15, 2025.

Early adoption is permitted and should be applied either prospectively or retrospectively.

The Company is currently evaluating this update to determine the impact on the Company’s disclosures .

NONINTEREST INCOME

33 unchanged sentences

This revenue stream primarily generates fee income through monthly, quarterly and annual billings for services provided.

Wealth management and advisory fees consists of fees from Bryn Mawr Trust ® , Cypress, West Capital, Powdermill ® , and WSFS Wealth ® Investments.

Wealth management and advisory fees consists of fees from Bryn Mawr Trust ® , BMCM, Powdermill ® , and WSFS Wealth ® Investments.

Wealth management and advisory fees are based on revenue earned from services including asset management, financial planning, family office, and brokerage.

11 unchanged sentences

The Company generates fee revenues from deposit service charges primarily through service charges and overdraft fees.

Service charges consist primarily of monthly account maintenance fees, cash management fees, foreign ATM fees and other maintenance fees.

Service charges consist primarily of monthly account maintenance fees, treasury management fees, foreign ATM fees and other maintenance fees.

All of these revenue streams generate fee income through service charges for monthly account maintenance and similar items, transfer fees, late fees, overlimit fees, and stop payment fees.

12 unchanged sentences

The BMTIA business was sold during the second quarter of 2022.

Other income consists of managed service fees, which are primarily courier fees related to cash management, currency preparation, ATM loss protection, capital markets revenue, and other miscellaneous products and services offered by the Bank.

Other income consists of managed service fees, which are primarily courier fees related to treasury management, currency preparation, ATM loss protection, capital markets revenue, and other miscellaneous products and services offered by the Bank.

These fees are primarily generated through monthly billings or at the time of the transaction.

Through its subsidiary BMTIA, the Bank earned commissions from the sale of insurance policies, which are generally calculated as a percentage of the policy premium, and contingent income, which is calculated based on the volume and performance of the policies held by each carrier.

Obligations for the sale of insurance policies are generally satisfied at the point in time which the policy is executed and are recognized at the point in time in which the amounts are known and collection is reasonably assured.

Performance metrics for contingent income are generally satisfied over time, not exceeding one year, and are recognized at the point in time in which the amounts are known and collection is reasonably assured.

Capital markets revenue consists of fees related to interest rate swaps, risk participation agreements, foreign exchange contracts, letters of credit, and trade finance products and services offered by the Bank.

Arrangements with multiple performance obligations

36 unchanged sentences

State and political subdivisions 185,912 2,665 959 8 187,610

Foreign bonds 500 2 — — 502

$ 1,058,565 $ 2,665 $ 75,291 $ 8 $ 985,931

(1) Held-to-maturity securities transferred from available-for-sale are included in held-to-maturity at amortized cost basis at the time of transfer.

The amortized cost of transferred held-to-maturity securities included net unrealized losses of $ 142.8 million at December 31, 2022, which are offset in Accumulated other comprehensive income (loss) .

The amortized cost of transferred held-to-maturity securities included net unrealized losses of $ 120.4 million at December 31, 2023, which are offset in Accumulated other comprehensive loss .

At the time of transfer, there was no allowance for credit loss on the available-for-sale securities.

12 unchanged sentences

Held-to-Maturity Debt Securities (1)

FNMA MBS $ 909,498 $ — $ 68,677 $ — $ 840,821

State and political subdivisions 201,631 532 3,372 10 198,781

1 unchanged sentence

$ 1,111,629 $ 534 $ 72,049 $ 10 $ 1,040,104

(1) Held-to–maturity securities transferred from available-for-sale are included in held-to-maturity at fair value at the time of transfer.

The amortized cost of transferred held-to-maturity securities included net unrealized gains of $ 0.2 million at December 31, 2021, which are offset in Accumulated other comprehensive income (loss) .

(1) Held-to–maturity securities transferred from available-for-sale are included in held-to-maturity at amortized cost basis at the time of transfer.

The amortized cost of transferred held-to-maturity securities included net unrealized losses of $ 142.8 million at December 31, 2022, which are offset in Accumulated other comprehensive loss .

At the time of transfer, there was no allowance for credit loss on the available-for-sale securities.

17 unchanged sentences

As of December 31, 2023, the Company’s available-for-sale investment securities consisted of 966 securities, 957 of which were in an unrealized loss position.

As of December 31, 2022, substantially all of the Corporation’s available-for-sale investment securities were mortgage-backed securities or collateral mortgage obligations which were issued or guaranteed by U.S.

As of December 31, 2023, substantially all of the Company’s available-for-sale investment securities were mortgage-backed securities or collateral mortgage obligations which were issued or guaranteed by U.S.

government-sponsored entities and agencies.

26 unchanged sentences

Investment securities with fair market values aggregating $ 3.3 billion and $ 2.8 billion were pledged as collateral for investment sweep repurchase agreements, municipal deposits, and other obligations as of December 31, 2023 and December 31, 2022, respectively.

During the year ended December 31, 2022, the Company had no sales of debt securities categorized as available-for-sale.

During the year ended December 31, 2021, the Company sold $ 14.1 million of debt securities categorized as available-for-sale, resulting in $ 0.3 million of realized gains and no realized losses.

During the year ended December 31, 2020, the Company sold $ 305.8 million, resulting in realized gains of $ 9.1 million and no realized losses.

During the years ended December 31, 2023 and December 31, 2022, the Company had no sales of debt securities categorized as available-for-sale.

During the year ended December 31, 2021, the Company sold $ 14.1 million of debt securities categorized as available-for-sale, resulting in realized gains of $ 0.3 million and no realized losses.

As of December 31, 2023 and December 31, 2022, the Company's debt securities portfolio had remaining unamortized premiums of $ 56.9 million and $ 66.6 million, respectively, and unaccreted discounts of $ 20.9 million and $ 25.2 million, respectively.

27 unchanged sentences

As a result, there is no allowance for credit losses recorded for available-for-sale debt securities as of December 31, 2023.

At December 31, 2022 and December 31, 2021, held-to-maturity debt securities had an amortized cost basis of $ 1.1 billion and $ 90.6 million, respectively.

At December 31, 2023 and December 31, 2022, held-to-maturity debt securities had an amortized cost basis of $ 1.1 billion.

The held-to-maturity debt security portfolio primarily consists of mortgage-backed securities which were issued or guaranteed by U.S.

2 unchanged sentences

The following table summarizes the amortized cost of debt securities held-to-maturity as of December 31, 2023, aggregated by credit quality indicator:

(Dollars in thousands) FNMA MBS State and political subdivisions Foreign bonds

(Dollars in thousands) FNMA MBS State and political subdivisions

A+ rated or higher $ — $ 185,912

2 unchanged sentences

The following table summarizes the amortized cost of debt securities held-to-maturity as of December 31, 2022, aggregated by credit quality indicator:

(Dollars in thousands) State and political subdivisions Foreign bonds

(Dollars in thousands) FNMA MBS State and political subdivisions Foreign bonds

A+ rated or higher $ — $ 201,631 $ 500

14 unchanged sentences

The Company had equity investments with a fair value of $ 17.4 million and $ 26.1 million as of December 31, 2023 and December 31, 2022, respectively.

During the twelve months ended December 31, 2022, total net gains on equity investments of $ 6.0 million were recorded from the Company's investment in Cred.ai in June 2022.

During the year ended December 31, 2023, total net gains on equity investments of $ 9.8 million were recorded, driven by a realized gain on the Company's investment in Spring EQ presented within Realized gain (loss) on sale of equity investment, net in the Consolidated Statements of Income.

During the year ended December 31, 2023, the Company recognized $ 2.5 million of net gains related to our equity method investments within Other income on the Consolidated Statements of Income.

During the year ended December 31, 2022, total net gains on equity investments of $ 6.0 million were recorded, driven by an unrealized gain on the Company's investment in cred.ai presented within Unrealized gain on equity investment, net in the Consolidated Statements of Income.

During the year ended December 31, 2022, the Company recognized $ 5.4 million of net gains related to our equity method investments within Other income on the Consolidated Statements of Income.

During the twelve months ended December 31, 2021, total net gains on equity investments of $ 4.4 million were recorded from the sale of the Company's investment in Social Finance, Inc.

(SoFi) in July 2021.

This included a net realized loss of $ 0.7 million which was recorded in Realized loss (gain) on equity investments, net in the Consolidated Statements of Income at the time of sale.

During the twelve months ended December 31, 2020, total net gains on equity investments of $ 22.8 million were recorded in the Company's Consolidated Statements of Income.

This included a net realized gain of $ 22.1 million which was recorded in Realized loss (gain) on equity investments, net for the sale of Visa Class B shares in June 2020.

This included a net realized loss of $ 0.7 million which was recorded in Realized gain (loss) on sale of equity investment, net in the Consolidated Statements of Income at the time of sale.

LOANS AND LEASES

2 unchanged sentences

Commercial and industrial $ 2,540,070 $ 2,575,345

$ 2,575,345 $ 1,918,043

Owner-occupied commercial 1,886,087 1,809,582

8 unchanged sentences

Net loans and leases $ 12,583,202 $ 11,759,992

(1) Includes PPP loans of $ 3.8 million and $ 31.5 million at December 31, 2022 and 2021, respectively.

(1) Includes reverse mortgages, at fair value of $ 2.8 million and $ 2.4 million at December 31, 2023 and 2022, respectively .

2 unchanged sentences

ALLOWANCE FOR CREDIT LOSSES AND CREDIT QUALITY INFORMATION

The following tables provide the activity of the Company's allowance for credit losses and loan and lease balances for the years ended December 31, 2022, December 31, 2021, and December 31, 2020.

During 2022, the increase was primarily due to an initial ACL of $ 49.6 million recorded in connection with the BMBC Merger and loan growth during the year.

The initial $ 49.6 million ACL recorded includes $ 23.5 million related to non-PCD loans, or the initial provision for credit loss recorded, and $ 26.1 million related to PCD loans, which does not have an initial income statement impact, but adjusts the amortized cost basis of the loans at acquisition (i.e., a balance sheet gross-up).

The following tables provide the activity of the Company's allowance for credit losses and loan and lease balances for the years ended December 31, 2023, 2022, and 2021.

During 2023, the increase was primarily due to net loan growth in our commercial mortgage, commercial small business leasing, and Upstart portfolios and higher provision on our commercial small business leasing, Upstart, commercial mortgage and elder care (subset of C&I) portfolios.

(Dollars in thousands) Commercial and Industrial (1)

3 unchanged sentences

Beginning balance $ 59,394 $ 6,019 $ 21,473 $ 6,987 $ 4,668 $ 53,320 $ 151,861

Initial allowance on acquired PCD loans 22,614 595 2,684 71 61 78 26,103

Charge-offs ( 42,294 ) ( 184 ) ( 300 ) ( 794 ) ( 41 ) ( 22,394 ) ( 66,007 )

Recoveries 9,721 54 7 532 260 1,625 12,199

(Credit) provision (4)

( 295 ) 751 7,524 2,446 776 36,881 48,083

Provision 37,743 4,830 14,875 4,037 596 25,992 88,073

Ending balance $ 64,564 $ 10,719 $ 36,055 $ 10,762 $ 5,483 $ 58,543 $ 186,126

8 unchanged sentences

Ending balance $ 3,163,692 $ 1,886,087 $ 3,801,180 $ 1,035,530 $ 867,895 $ 2,012,134 $ 12,766,518

(1) Includes commercial small business leases and PPP loans.

(1) Includes commercial small business leases.

(2) Period-end loan balance excludes reverse mortgages at fair value of $ 2.8 million.

(3) Includes home equity lines of credit, installment loans, unsecured lines of credit and education loans.

(4) Includes $ 23.5 million initial provision for credit losses on non-PCD loans.

(Dollars in thousands) Commercial and Industrial (1)

4 unchanged sentences

Beginning balance $ 49,967 $ 4,574 $ 11,623 $ 1,903 $ 3,352 $ 23,088 $ 94,507

Initial allowance on acquired PCD loans 22,614 595 2,684 71 61 78 26,103

Charge-offs ( 19,004 ) ( 179 ) ( 581 ) — ( 186 ) ( 7,520 ) ( 27,470 )

1 unchanged sentence

(Credit) provision (4)

( 295 ) 751 7,524 2,446 776 36,881 48,083

Ending balance $ 59,394 $ 6,019 $ 21,473 $ 6,987 $ 4,668 $ 53,320 $ 151,861

7 unchanged sentences

Ending balance $ 3,134,326 $ 1,809,582 $ 3,351,084 $ 1,044,049 $ 759,465 $ 1,810,930 $ 11,909,436

(1) Includes commercial small business leases and PPP loans.

(1) Includes commercial small business leases.

(2) Period-end loan balance excludes reverse mortgages at fair value of $ 2.4 million.

(3) Includes home equity lines of credit, installment loans, unsecured lines of credit and education loans.

(4) Includes $ 23.5 million initial provision for credit losses on non-PCD loans.

(Dollars in thousands) Commercial and Industrial (1)

2 unchanged sentences

Allowance for loan and lease losses

Beginning balance, prior to adoption of ASC 326 $ 22,849 $ 4,616 $ 7,452 $ 3,891 $ 1,381 $ 7,387 $ 47,576

Impact of adoption ASC 326 (4)

19,747 ( 1,472 ) 1,662 681 7,522 7,715 35,855

Beginning balance $ 150,875 $ 9,615 $ 31,071 $ 12,190 $ 6,893 $ 18,160 $ 228,804

Charge-offs ( 23,592 ) ( 83 ) ( 73 ) ( 2,473 ) — ( 2,094 ) ( 28,315 )

Recoveries 8,756 160 269 — 789 1,131 11,105

Provision (credit) 114,412 6,665 21,903 7,582 ( 2,011 ) 4,629 153,180

(Credit) provision ( 86,072 ) ( 5,118 ) ( 19,644 ) ( 7,814 ) ( 4,330 ) 5,891 ( 117,087 )

Ending balance $ 49,967 $ 4,574 $ 11,623 $ 1,903 $ 3,352 $ 23,088 $ 94,507

10 unchanged sentences

(3) Includes home equity lines of credit, installment loans, unsecured lines of credit and education loans.

(4) Includes $ 0.1 million for the initial allowance on loans purchased with credit deterioration.

The following tables show nonaccrual and past due loans presented at amortized cost at the date indicated:

3 unchanged sentences

Still Accruing

Nonaccrual Loans With No Allowance (1)

Nonaccrual Loans With An Allowance Total

Commercial and industrial (2)

8 unchanged sentences

% of Total Loans 0.28 % 0.09 % 0.37 % 99.13 % 0.46 % 0.04 % 100.00 %

(1) There were no nonaccrual loans with an allowance as of December 31, 2022.

(2) Includes commercial small business leases and PPP loans.

(1) Excludes nonaccruing loans held-for-sale.

(2) Includes commercial small business leases.

(3) Residential accruing current balances exclude reverse mortgages at fair value of $ 2.8 million.

15 unchanged sentences

% of Total Loans 0.26 % 0.14 % 0.40 % 99.41 % 0.19 % 100.00 %

(1) Nonaccrual loans with an allowance totaled less than $ 0.1 million.

(2) Includes commercial small business leases and PPP loans.

(1) There were no nonaccrual loans with an allowance as of December 31, 2022.

(2) Includes commercial small business leases.

(3) Residential accruing current balances exclude reverse mortgages at fair value of $ 2.4 million.

14 unchanged sentences

(1) Includes commercial small business leases.

(2) Excludes nonaccruing loans held-for-sale.

(3) Excludes reverse mortgages at fair value.

(4) Includes home equity lines of credit, installment loans, unsecured lines of credit and education loans .

Interest income of $ 1.0 million was recognized on individually reviewed loans during 2022 compared to $ 0.8 million during 2021 and 2020.

As of December 31, 2023, there were 31 residential loans and 9 commercial loans in the process of foreclosure.

33 unchanged sentences

Commercial and industrial (2) :

$ 1,123,803 $ 501,761 $ 387,225 $ 211,310 $ 153,713 $ 276,588 $ 8,099 $ 250,486 $ 2,912,985

Pass $ 977,196 $ 682,680 $ 283,771 $ 251,848 $ 105,933 $ 395,601 $ 8,785 $ 237,786 $ 2,943,600

Special mention 7,209 11,860 2,804 463 735 743 — 1,649 25,463

1 unchanged sentence

72,993 54,024 5,951 10,224 22,046 17,906 — 11,485 194,629

$ 1,057,398 $ 748,564 $ 292,526 $ 262,535 $ 128,714 $ 414,250 $ 8,785 $ 250,920 $ 3,163,692

Current-period gross writeoffs $ 1,528 $ 7,818 $ 9,661 $ 3,201 $ 8,302 $ 11,784 $ — $ — $ 42,294

Owner-occupied commercial:

3 unchanged sentences

$ 350,789 $ 286,875 $ 267,790 $ 220,257 $ 213,174 $ 354,690 $ — $ 192,512 $ 1,886,087

Current-period gross writeoffs $ — $ — $ — $ — $ 184 $ — $ — $ — $ 184

Commercial mortgages:

3 unchanged sentences

$ 877,631 $ 466,048 $ 527,394 $ 481,028 $ 511,873 $ 631,660 $ — $ 305,546 $ 3,801,180

Current-period gross writeoffs $ — $ 83 $ — $ 217 $ — $ — $ — $ — $ 300

Construction:

3 unchanged sentences

$ 463,471 $ 339,727 $ 122,868 $ 11,628 $ 2,522 $ 7,016 $ — $ 88,298 $ 1,035,530

Current-period gross writeoffs $ — $ — $ 794 $ — $ — $ — $ — $ — $ 794

Residential (4) :

2 unchanged sentences

$ 188,644 $ 67,528 $ 103,695 $ 57,759 $ 34,750 $ 415,519 $ — $ — $ 867,895

$ 64,500 $ 111,237 $ 61,127 $ 37,117 $ 47,077 $ 438,407 $ — $ — $ 759,465

Current-period gross writeoffs $ 33 $ — $ — $ — $ — $ 8 $ — $ — $ 41

Consumer (5) :

2 unchanged sentences

$ 391,580 $ 568,919 $ 154,065 $ 104,600 $ 45,172 $ 245,879 $ 496,025 $ 5,894 $ 2,012,134

$ 595,158 $ 195,397 $ 126,806 $ 54,449 $ 220,518 $ 71,478 $ 541,563 $ 5,561 $ 1,810,930

Current-period gross writeoffs $ 1,790 $ 15,227 $ 4,411 $ 313 $ 198 $ 455 $ — $ — $ 22,394

(1) Origination date represent the most recent underwriting of the loan which includes new relationships, renewals and extensions.

(2) Includes commercial small business leases.

(2) Includes $ 3.8 million of PPP loans

(3) Excludes nonacrruing loans held-for-sale.

(4) Excludes reverse mortgages at fair value.

(4) Includes troubled debt restructured mortgages performing in accordance with the loans' modified terms and are accruing interest.

(5) Includes home equity lines of credit, installment loans, unsecured lines of credit and education loans.

(6) Includes troubled debt restructured home equity installment loans performing in accordance with the loans' modified terms and are accruing interest.

The following table provides an analysis of loans by portfolio segment based on the credit quality indicators used to determine the allowance for credit losses as of December 31, 2022.

4 unchanged sentences

Commercial and industrial (1) :

$ 556,896 $ 420,698 $ 329,354 $ 273,345 $ 139,800 $ 148,809 $ 5,551 $ 176,006 $ 2,050,459

Pass $ 1,123,803 $ 501,761 $ 387,225 $ 211,310 $ 153,713 $ 276,588 $ 8,099 $ 250,486 $ 2,912,985

Special mention 28,672 27,689 7,585 9,451 347 1,010 — 2,596 77,350

20 unchanged sentences

$ 64,500 $ 111,237 $ 61,127 $ 37,117 $ 47,077 $ 438,407 $ — $ — $ 759,465

$ 59,977 $ 28,538 $ 13,570 $ 32,871 $ 45,032 $ 362,745 $ — $ — $ 542,733

Consumer (3) :

2 unchanged sentences

$ 595,158 $ 195,397 $ 126,806 $ 54,449 $ 220,518 $ 71,478 $ 541,563 $ 5,561 $ 1,810,930

$ 219,918 $ 170,069 $ 74,048 $ 204,119 $ 39,184 $ 60,952 $ 384,373 $ 5,910 $ 1,158,573

(1) Includes commercial small business leases.

(2) Includes $ 31.5 million of PPP loans

(2) Excludes reverse mortgages at fair value.

(4) Includes troubled debt restructured mortgages performing in accordance with the loans' modified terms and are accruing interest.

(3) Includes home equity lines of credit, installment loans, unsecured lines of credit and education loans.

(6) Includes troubled debt restructured home equity installment loans performing in accordance with the loans' modified terms and are accruing interest.

Troubled Debt Restructurings (TDR)

The following table presents the balance of TDRs as of the indicated dates:

(Dollars in thousands) December 31, 2022 December 31, 2021

Troubled Loans

The Company offers loan modifications to commercial and consumer borrowers that may result in a payment delay, interest rate reduction, term extension, principal forgiveness, or combination thereof.

Loan modifications are offered on a case-by-case basis and are generally term extension, payment delay, and interest rate reduction modification types.

Forbearance (due to hardship) programs result in modification types including payment delay and/or term extension.

In addition, certain reorganization bankruptcy judgments may result in interest rate reduction, term extension, or principal forgiveness modification types.

The following table shows the amortized cost basis at the end of the reporting period of troubled loans, disaggregated by portfolio segment and type of modification granted.

December 31, 2023

(Dollars in thousands) Term Extension More-Than-Insignificant Payment Delay Combination- Term Extension and Payment Delay Combination- Term Extension and Interest Rate Reduction Combination - Payment Delay and Interest Rate Reduction Total % of Total Loan Category

Commercial and industrial (1)(2)

$ 44,123 $ 10,523 $ 5,568 $ 27 $ — $ 60,241 1.90 %

Owner-occupied commercial 66 — — 138 — 204 0.01 %

Commercial mortgages 9,386 — — — — 9,386 0.25 %

Construction 15,411 — — — — 15,411 1.49 %

Residential 561 216 — — — 777 0.09 %

1,782 1,937 5,092 156 194 9,161 0.46 %

Total $ 71,329 $ 12,676 $ 10,660 $ 321 $ 194 $ 95,180 0.75 %

(1) Includes commercial small business leases.

(2) Excludes troubled loan held-for-sale.

(3) Includes home equity lines of credit, installment loans, unsecured lines of credit and education loans.

The following table describes the financial effect of the modifications made to troubled loans as of December 31, 2023:

Term Extension ( 1)

Interest Rate Reduction (2)

More-Than-Insignificant Payment Delay (3)

Commercial and industrial (4)

1.34 4.00 % 0.13 %

Owner-occupied commercial 0.95 2.59 —

Commercial mortgages 1.33 — —

Construction 1.00 — —

Residential 20.18 — —

Consumer 3.08 2.65 0.06

(1) Represents the weighted-average increase in the life of modified loans measured in years, which reduces monthly payment amounts for borrowers.

(2) Represents the weighted-average decrease in the contractual interest rate on the modified loans.

(3) Represents the percentage of loans deferred over the total loan portfolio excluding reverse mortgages at fair value.

(4) Excludes troubled loan held-for-sale.

As of December 31, 2023, the Company had commitments to extend credit of $ 18.4 million to borrowers experiencing financial difficulty whose terms had been modified.

Upon the Company’s determination that a modified loan (or portion of a loan) has subsequently been deemed uncollectible, the loan (or a portion of the loan) is written off.

Therefore, the amortized cost basis of the loan is reduced by the uncollectible amount and the allowance for credit losses is adjusted by the same amount.

The following table shows the amortized cost of loans that received a term extension modification that had a payment default during the period and were modified in the 12 months before default to borrowers experiencing financial difficulty as of December 31, 2023.

More-Than-Insignificant Payment Delay Combination Term Extension & Payment Delay Total

Commercial and industrial $ — $ 5,568 $ 5,568

Consumer 98 — 98

Total $ 98 $ 5,568 $ 5,666

The Company closely monitors the performance of troubled loans to understand the effectiveness of its modification efforts.

The following table shows the performance of loans that have been modified in the last 12 months:

December 31, 2023

(Dollars in thousands) 30-89 Days Past Due and Still Accruing 90+ Days Past Due and Still Accruing Accruing Current Balances Nonaccrual Loans Total

Commercial and industrial (1)(2)

$ 21 $ 293 $ 53,989 $ 5,938 $ 60,241

Owner-occupied commercial — — — 204 204

Commercial mortgages — — 9,386 — 9,386

Construction — — 15,411 — 15,411

Residential — — 607 170 777

1,021 205 7,539 396 9,161

Total $ 1,042 $ 498 $ 86,932 $ 6,708 $ 95,180

(1) Includes commercial small business leases.

(2) Excludes troubled loan held-for-sale.

(3) Includes home equity lines of credit, installment loans, unsecured lines of credit and education loans.

Troubled Debt Restructurings (TDRs) under ASC 326 for periods prior to adoption of ASU 2022-02

The following table presents the balance of TDRs as of the indicated date:

(Dollars in thousands) December 31, 2022

Performing TDRs $ 19,737

1 unchanged sentence

Total TDRs $ 21,743

Approximately $ 0.6 million and $ 0.2 million in related reserves have been established for these loans at December 31, 2022 and December 31, 2021, respectively.

The following tables present information regarding the types of loan modifications made and the balances of loans modified as TDRs during the years ended December 31, 2022 and 2021:

December 31, 2022 December 31, 2021

Total Contractual

Approximately $ 0.6 million in related reserves have been established for these loans at December 31, 2022.

The following tables present information regarding the types of loan modifications made and the balances of loans modified as TDRs during the year ended and December 31, 2022:

December 31, 2022

reduction Maturity

11 unchanged sentences

(Dollars in thousands) 2022

Modification Post

Modification Pre

Commercial $ 1,067 $ 1,067

1 unchanged sentence

Commercial mortgages 2,380 2,380

Construction — — — —

Residential 302 302

Consumer 4,178 4,178

Total (1)(2)(3)

$ 10,014 $ 10,014

1 unchanged sentence

During the year ended December 31, 2022, no TDRs defaulted that had received troubled debt modification during the past twelve months.

(2) During the year ended December 31, 2021 the TDRs in the table above resulted in a less than $ 0.1 million increase in the allowance for credit losses, and no additional charge-offs.

During the year ended December 31, 2021, no TDRs defaulted that had received troubled debt modification during the past twelve months.

(2) The TDRs in the table above did not occur as a result of the loan forbearance program under the CARES Act.

12 unchanged sentences

As a lessor, the Company primarily provides financing through its equipment leasing business.

The Company's ongoing leases have remaining lease terms of less than 1 year to 39 years, which includes renewal options that are exercised at its discretion.

The Company's ongoing leases have remaining lease terms of less than one year to 22 years, which includes renewal options that are exercised at its discretion.

The Company's lease terms to calculate the lease liability and right-of-use asset include options to extend the lease when it is reasonably certain that the Company will exercise the option.

32 unchanged sentences

Right of use assets obtained in exchange for new operating lease liabilities (non-cash) — 13,707 —

As of December 31, 2023, the Company had not entered into any material leases that have not yet commenced.

Lessor Equipment Leasing

The Company provides equipment and small business lease financing through its leasing subsidiary, NewLane Finance ® , acquired from its Beneficial acquisition.

The Company provides equipment and small business lease financing through its leasing subsidiary, NewLane Finance ® .

Interest income from direct financing leases where the Company is a lessor is recognized in Interest and fees on loans and leases on the Consolidated Statements of Income.

5 unchanged sentences

Interest income on lease receivable $ 53,572 $ 42,542 $ 21,947

(Amortization)/accretion of deferred fees and costs ( 3,718 ) ( 1,963 ) 433

Amortization of deferred fees and costs ( 6,301 ) ( 3,718 ) ( 1,963 )

Total direct financing lease income $ 47,271 $ 38,824 $ 19,984

14 unchanged sentences

WSFS performs its annual goodwill impairment test on October 1 or more frequently if events and circumstances indicate that the fair value of a reporting unit is less than its carrying value.

In between annual tests, management performs a qualitative review of goodwill quarterly as part of the Company's review of the overall business to ensure no events or circumstances have occurred that would impact its goodwill evaluation.

During the year ended December 31, 2022, management determined based on its qualitative assessment that it is not more likely than not that the fair values of our reporting units are less than their carrying values.

No goodwill impairment exists during the year ended December 31, 2022.

Between annual tests, management performs a qualitative review of goodwill quarterly as part of the Company's review of the overall business to ensure no events or circumstances have occurred that would impact its goodwill evaluation.

During the year ended December 31, 2023, management determined that the fair values of our reporting units exceeded their carrying values, and no goodwill impairment existed during the year ended December 31, 2023.

The following table shows the allocation of goodwill to the reportable operating segments for purposes of goodwill impairment testing:

1 unchanged sentence

December 31, 2021 $ 452,629 $ 20,199 $ 472,828

Goodwill from business combinations 297,646 116,691 414,337

Goodwill adjustments 3,311 ( 6,839 ) ( 3,528 )

1 unchanged sentence

Goodwill from business combinations (1)

Goodwill adjustments (1)

— 2,261 2,261

December 31, 2023 $ 753,586 $ 132,312 $ 885,898

(1) Goodwill adjustments include the remeasurements as noted in Note 3 and Wealth Management includes the impact of the sale of the BMTIA business.

(1) During the third quarter of 2023, BMCM acquired the business of a registered investment advisory firm.

ASC 350 requires that an acquired intangible asset be separately recognized if the benefit of the intangible asset is obtained through contractual or other legal rights, or if the asset can be sold, transferred, licensed, rented or exchanged, regardless of the acquirer’s intent to do so.

5 unchanged sentences

Customer relationships 73,880 ( 18,153 ) 55,727 7 - 15 years

Non-compete agreements 200 ( 200 ) — 1 year

Tradename 2,900 — 2,900 indefinite

5 unchanged sentences

Customer relationships 68,281 ( 12,937 ) 55,344 7 - 15 years

Non-compete agreements 200 ( 200 ) — 1 year

Tradename 2,900 — 2,900 indefinite

Loan servicing rights (2)

1 unchanged sentence

Total intangible assets $ 187,250 $ ( 58,655 ) $ 128,595

(1) Includes impairment losses of less than $ 0.1 million for the year ended December 31, 2023.

(2) Includes impairment losses of $ 0.3 million for the year ended December 31, 2022.

(2) Includes reversal of impairment losses of $ 0.3 million for the year ended December 31, 2021.

In connection with the BMBC Merger on January 1, 2022, the Company recorded $ 10.9 million of core deposit intangibles, $ 53.0 million of customer relationships, $ 2.9 million for the Bryn Mawr Trust tradename, $ 0.2 million in non-compete agreements, and $ 3.3 million of loan servicing rights.

See Note 3 to the Consolidated Financial Statements for additional information on intangible assets recorded in connection with the BMBC Merger.

The Company recognized amortization expense on other intangible assets of $ 15.5 million, $ 15.7 million and $ 10.6 million for the years ended December 31, 2023, 2022 and 2021, respectively.

11 unchanged sentences

The value of the Company's mortgage servicing rights was $ 1.7 million and $ 2.1 million at December 31, 2023 and 2022, respectively, and the value of its SBA loan servicing rights was $ 4.3 million and $ 4.0 million at December 31, 2023 and 2022, respectively.

In connection with the BMBC Merger, the Company acquired $ 2.0 million of mortgage servicing rights and $ 1.3 million of SBA loan servicing rights.

Changes in the value of these servicing rights resulted in impairment losses of $ 0.3 million during 2022 and a reversal of impairment losses of $ 0.3 million during 2021.

Changes in the value of these servicing rights resulted in impairment losses of less than $ 0.1 million during 2023 and impairment losses of $ 0.3 million during 2022.

Revenues from originating, marketing and servicing mortgage loans as well as valuation adjustments related to capitalized mortgage servicing rights are included in Mortgage Banking Activities, Net in the Consolidated Statements of Income and revenues from the Company's SBA loan servicing rights are included in Loan fee income, in the Consolidated Statements of Income.

57 unchanged sentences

Other borrowed funds 38,283 0.10 38,283 35,473 0.10

Federal Funds Purchased and Securities Sold Under Agreements to Repurchase

During 2022 and 2021, the Company purchased federal funds as a short-term funding source.

The Company had no securities sold under agreements to repurchase at December 31, 2022 and December 31, 2021.

Federal Home Loan Bank Advances

As of December 31, 2022, advances from the FHLB totaled $ 350.0 million with rates ranging from 4.45 % to 4.50 %.

All FHLB advances had original maturities of less than one year.

As of December 31, 2023, there were no advances from the FHLB.

Pursuant to collateral agreements with the FHLB, advances are secured by qualifying loan collateral, qualifying fixed-income securities, FHLB stock and an interest-bearing demand deposit account with the FHLB.

4 unchanged sentences

Trust Preferred Borrowings

In 2005, the Company issued $ 67.0 million of aggregate principal amount of Pooled Floating Rate Securities at a variable interest rate of 177 basis points over the three-month LIBOR rate.

In 2005, the Trust issued Pooled Floating Rate Securities at a variable interest rate of 177 basis points over the three-month LIBOR rate with a scheduled maturity of June 1, 2035.

The reference rate on these securities was updated to three-month term SOFR upon the discontinuation of LIBOR on June 30th, 2023.

These securities are currently callable and have a maturity date of June 1, 2035.

In connection with the BMBC Merger, WSFS acquired Royal Bancshares Capital Trust I (Trust I) and Royal Bancshares Capital Trust II (Trust II) (collectively, the Trusts), which were utilized for the sole purpose of issuing and selling capital securities representing preferred beneficial interests.

Although WSFS owns an aggregate of $ 774.0 thousand of the common securities of Trust I and Trust II, the Trusts are not consolidated into the Corporation’s Consolidated Financial Statements as the Corporation is not deemed to be the primary beneficiary of these entities.

Inclusive of the fair value marks, WSFS assumed junior subordinated debentures to the Trusts with a carrying value of $ 11.7 million each, totaling $ 23.4 million.

Royal Bancshares Capital Trust I (Trust I) and Royal Bancshares Capital Trust II (Trust II) (collectively, the RBC Trusts), which were acquired from Bryn Mawr Bank Corporation, were utilized for the sole purpose of issuing and selling capital securities representing preferred beneficial interests.

Although WSFS owns an aggregate of $ 0.8 million of the common securities of Trust I and Trust II, the RBC Trusts are not consolidated into the Company’s Consolidated Financial Statements as the Company is not deemed to be the primary beneficiary of these entities.

Inclusive of the fair value marks, WSFS assumed junior subordinated debentures to the RBC Trusts with a current carrying value of $ 11.8 million each, totaling $ 23.6 million.

The junior subordinated debentures incur interest at a coupon rate of 7.80 % as of December 31, 2023.

The rate resets quarterly based on 3-month LIBOR plus 2.15 %.

Each of Trust I and Trust II issued an aggregate principal amount of $ 12.5 million of capital securities initially bearing fixed and/or fixed/floating interest rates corresponding to the debt securities held by each Trust to an unaffiliated investment vehicle and an aggregate principal amount of $ 387.0 thousand of common securities bearing fixed and/or fixed/floating interest rates corresponding to the debt securities held by each Trust to the Company.

The Company has fully and unconditionally guaranteed all of the obligations of the Trusts, including any distributions and payments on liquidation or redemption of the capital securities.

The rights of holders of common securities of the Trusts are subordinate to the rights of the holders of capital securities only in the event of a default;

The rate resets quarterly based on three-month term SOFR plus 2.41 %.

Each of Trust I and Trust II issued an aggregate principal amount of $ 12.5 million of capital securities initially bearing fixed and/or fixed/floating interest rates corresponding to the debt securities held by each Trust to an unaffiliated investment vehicle and an aggregate principal amount of $ 0.4 million of common securities bearing fixed and/or fixed/floating interest rates corresponding to the debt securities held by each Trust to the Company.

The Company has fully and unconditionally guaranteed all of the obligations of the RBC Trusts, including any distributions and payments on liquidation or redemption of the capital securities.

The rights of holders of common securities of the RBC Trusts are subordinate to the rights of the holders of capital securities only in the event of a default;

otherwise, the common securities’ economic and voting rights are pari passu with the capital securities.

The capital and common securities of the Trusts are subject to mandatory redemption upon the maturity or call of the junior subordinated debentures held by each.

Unless earlier dissolved, the Trusts will dissolve on December 15, 2034.

The capital and common securities of the RBC Trusts are subject to mandatory redemption upon the maturity or call of the junior subordinated debentures held by each.

Unless earlier dissolved, the RBC Trusts will dissolve on December 15, 2034.

The junior subordinated debentures are the sole assets of Trusts, mature on December 15, 2034, and may be called at par by the Company any time.

The Company records its investments in the Trusts’ common securities of $ 387.0 thousand each as investments in unconsolidated entities and records dividend income upon declaration by Trust I and Trust II.

The Company records its investments in the RBC Trusts’ common securities of $ 0.4 million each as investments in unconsolidated entities and records dividend income upon declaration by Trust I and Trust II.

Federal Funds Purchased and Securities Sold Under Agreements to Repurchase

During 2023 and 2022, the Company purchased federal funds as a short-term funding source.

The Company had no securities sold under agreements to repurchase at December 31, 2023 and December 31, 2022.

Senior and Subordinated Debt

6 unchanged sentences

The remaining net proceeds from the issuance of the 2030 Notes are being used for general corporate purposes, including, but not limited to, financing organic growth, acquisitions, repurchases of common stock, and redemption of outstanding indebtedness.

The carrying value of the 2030 Notes, inclusive of deferred issuance costs, was $ 148.2 million as of December 31, 2022.

In connection with the BMBC Merger, the Company assumed $ 30.0 million in aggregate principal amount of fixed-to-floating rate subordinated notes due 2025 (the 2025 Notes) which were issued in a private placement to institutional accredited investors on August 6, 2015.

The 2025 Notes mature on August 15, 2025, and currently bear interest at a variable rate that resets quarterly to a level equal to the then-current three-month LIBOR rate plus 3.068 % until August 15, 2025, or any early redemption date.

The interest rate of the 2025 Notes was 7.837 % as of December 31, 2022.

The carrying value of the 2025 Notes, inclusive of purchase accounting marks, was $ 30.0 million as of December 31, 2022.

In connection with the BMBC Merger, the Company assumed $ 70.0 million in aggregate principal amount of fixed-to-floating rate subordinated notes due 2027 (the 2027 Notes) which were issued by BMBC in an underwritten public offering on December 13, 2017.

The 2027 Notes mature on December 15, 2027, and currently bear interest at an annual fixed rate of 6.82 % until and including December 14, 2022, and will thereafter bear interest at a variable rate that will reset quarterly to a level equal to the then-current three-month LIBOR rate plus 2.05 % until December 15, 2027, or any early redemption date.

The carrying value of the 2027 Notes, inclusive of purchase accounting marks, was $ 70.0 million as of December 31, 2022.

The carrying value of the 2030 Notes, inclusive of deferred issuance costs, was $ 148.4 million as of December 31, 2023 and $ 148.2 million as of December 31, 2022.

The Company assumed $ 30.0 million in aggregate principal amount of fixed-to-floating rate subordinated notes due 2025 (the 2025 Notes) from Bryn Mawr Bank Corporation, which were issued in a private placement to institutional accredited investors on August 6, 2015.

Effective February 15, 2023, the Company redeemed all remaining outstanding principal amount of the 2025 Notes.

The 2025 Notes bore interest at a variable rate that reset quarterly to a level equal to the then-current three-month LIBOR plus an issuance spread of 3.068 %.

The Company assumed $ 70.0 million in aggregate principal amount of fixed-to-floating rate subordinated notes due 2027 (the 2027 Notes) from Bryn Mawr Bank Corporation, which were issued by Bryn Mawr Bank Corporation in an underwritten public offering on December 13, 2017.

The 2027 Notes mature on December 15, 2027, and had a fixed annual interest of 4.25 % until and including December 14, 2022, and currently bear interest at a variable rate of 7.70 %.

The variable rate will reset quarterly to a level equal to the three-month term SOFR rate plus 2.31 % until December 15, 2027, or any early redemption date.

The carrying value of the 2027 Notes was $ 70.0 million as of December 31, 2023 and December 31, 2022.

Other Borrowed Funds

Included in other borrowed funds are collateralized borrowings of $ 38.3 million and $ 24.5 million at December 31, 2022 and 2021, respectively, consisting of outstanding retail repurchase agreements, contractual arrangements under which portions of certain securities are sold overnight to retail customers under agreements to repurchase.

Included in other borrowed funds are collateralized borrowings of $ 586.0 million and $ 38.3 million at December 31, 2023 and 2022, respectively, primarily consisting of Bank Term Funding Program (BTFP) borrowings of $ 565.0 million borrowed in 2023 as well as outstanding retail repurchase agreements, contractual arrangements under which portions of certain securities are sold overnight to retail customers under agreements to repurchase.

Such borrowings were collateralized by mortgage-backed securities.

Borrower in Custody

The Company had $ 737.7 million and $ 282.1 million of loans and securities pledged to the Federal Reserve of Philadelphia (FRB) at December 31, 2022 and December 31, 2021, respectively.

The Company did no t borrow funds from the FRB during 2022 or 2021.

The Company had $ 2.1 billion and $ 0.7 billion of loans and securities pledged to the Federal Reserve of Philadelphia (FRB) at December 31, 2023 and December 31, 2022, respectively.

The Company borrowed $ 565.0 million from the FRB during 2023.

The Company did no t borrow funds from the FRB during 2022.

STOCKHOLDERS' EQUITY AND REGULATORY CAPITAL

41 unchanged sentences

In 2005, the Trust issued Pooled Floating Rate Securities at a variable interest rate of 177 basis points over the three-month LIBOR rate with a scheduled maturity of June 1, 2035.

The reference rate on these securities was updated to three-month term SOFR upon the discontinuation of LIBOR on June 30th, 2023.

The par value of these securities is $ 2.0 million and the aggregate principal is $ 67.0 million.

2 unchanged sentences

The effective rate will vary due to fluctuations in interest rates.

Inclusive of the fair value marks, WSFS assumed junior subordinated debentures to the Trusts with a carrying value of $ 11.7 million each, totaling $ 23.4 million.

Inclusive of the fair value marks, WSFS assumed junior subordinated debentures to the RBC Trusts with a current carrying value of $ 11.8 million each, totaling $ 23.6 million.

The junior subordinated debentures incur interest at a coupon rate of 7.80 % as of December 31, 2023.

The rate resets quarterly based on 3-month LIBOR plus 2.15 %.

The rate resets quarterly based on three-month term SOFR plus 2.41 %.

These securities are treated as borrowings with interest included in Interest on trust preferred borrowings on the Consolidated Statements of Income and included in Trust preferred borrowings in the Consolidated Statements of Financial Condition.

The Trust preferred borrowings issued in 2005 and acquired through the BMBC Merger qualify as Tier 2 capital.

The Trust preferred borrowings issued in 2005 were previously Tier 1 capital, but migrated to Tier 2 capital following the BMBC Merger and impacts of 12 C.F.R.

The Trust preferred borrowings qualify as Tier 2 capital.

The Trust preferred borrowings issued in 2005 were previously Tier 1 capital, but migrated to Tier 2 capital following the acquisition of Bryn Mawr Bank Corporation and impacts of 12 C.F.R.

§ 217.300(c)(2)(i).

3 unchanged sentences

During the year ended December 31, 2023, the Company repurchased 1,247,178 common shares at an average price of $ 41.52 per share as part of its share buy-back program approved by the Board of Directors.

The program is consistent with the Company's intent to return a minimum of 35 % of annual core net income to stockholders through dividends and share repurchases while maintaining capital ratios in excess of regulatory minimums, and in the case of the Bank, the “well-capitalized” benchmarks.

The program is consistent with the Company's intent to return a minimum of 35 % of annual net income to stockholders through dividends and share repurchases while maintaining capital ratios in excess of regulatory minimums, and in the case of the Bank, the “well-capitalized” benchmarks.

ASSOCIATE BENEFIT PLANS

31 unchanged sentences

Interest cost 65 51 54

Actuarial (gain) loss ( 833 ) ( 216 ) 80

Actuarial gain ( 68 ) ( 833 ) ( 216 )

Benefits paid ( 50 ) ( 77 ) ( 55 )

34 unchanged sentences

The Company estimates that it will contribute approximately $ 4,496 per retiree to the plan during fiscal 2024.

Alliance Associate Pension Plan

During the fourth quarter of 2015, the Company completed the acquisition of Alliance.

At the time of the acquisition the Company assumed the Alliance pension plan offered to current Alliance associates.

During the fourth quarter of 2018, the Company notified the Alliance pension plan participants, the Internal Revenue Service (IRS), and the Pension Benefit Guaranty Corporation (PBGC) of its intention to terminate the plan and received IRS and PBGC approval in the first quarter of 2020.

The Company completed the termination and contributed $ 0.5 million to the plan to settle the obligation during the three months ended June 30, 2020.

The following disclosures relating to Alliance pension benefits were measured at:

(Dollars in thousands) June 30, 2020

Change in benefit obligation:

Benefit obligation at beginning of year $ 6,893

Interest cost 105

Settlements ( 7,272 )

Actuarial loss 274

Benefit obligation at end of period $ —

Change in plan assets:

Fair value of plan assets at beginning of year $ 7,431

Actual return on plan assets ( 159 )

Settlements ( 7,272 )

Fair value of plan assets at end of period $ —

Funded status $ —

Amounts recognized in accumulated other comprehensive income (1) :

Components of net periodic cost:

Service cost $ 17

Interest cost 105

Expected return on plan assets ( 196 )

Plan settlement loss 1,431

Net periodic cost $ 1,357

(1) Before tax effects

Beneficial Associate Pension and other postretirement benefit plans

3 unchanged sentences

The following disclosures relating to Beneficial pension benefits and other postretirement benefit plans were measured at December 31, 2023:

(Dollars in thousands) Pension Benefits Other Postretirement Benefits Pension Benefits Other Postretirement Benefits

2023 2022 2021

(Dollars in thousands) Pension Benefits Other Postretirement Benefits Pension Benefits Other Postretirement Benefits Pension Benefits Other Postretirement Benefits

Change in benefit obligation:

4 unchanged sentences

Amendments — — — — ( 83 ) —

Actuarial gain ( 26,233 ) ( 3,346 ) ( 4,420 ) ( 442 )

Actuarial loss (gain) 1,604 256 ( 26,233 ) ( 3,346 ) ( 4,420 ) ( 442 )

Benefits paid ( 4,336 ) ( 1,415 ) ( 5,736 ) ( 1,336 ) ( 5,185 ) ( 1,171 )

62 unchanged sentences

Large cap $ 3,721 $ — $ — $ 3,721 4.7 %

Mid cap 75 — — 75 0.1

Small cap 59 — — 59 0.1

International 6,651 — — 6,651 8.4

3 unchanged sentences

Government Agencies — 17,259 — 17,259 21.8

Pooled Separate Accounts 123 — — 123 0.2

Accrued Income 161 — — 161 0.1

11 unchanged sentences

(2) an Early Retirement Window Plan with a corresponding liability of $ 0.1 million for both December 31, 2023 and 2022;

(3) a Supplemental Executive Retirement Plan with a corresponding liability of $ 1.3 million and $ 1.4 million for December 31, 2022 and 2021, respectively, and;

(3) a Supplemental Executive Retirement Plan with a corresponding liability of $ 1.3 million for both December 31, 2023 and 2022, and;

(4) a Post-Retirement Medical Plan with a corresponding liability of $ 0.1 million for both December 31, 2023 and 2022.

20 unchanged sentences

Derivatives 2,806 3,521

Employee benefit plans 181 1,340

Lease liabilities 31,835 33,236

2 unchanged sentences

Deferred tax liabilities:

Legal settlement — ( 3,150 )

Accelerated depreciation ( 5,790 ) ( 5,994 )

Right of use assets ( 27,426 ) ( 28,859 )

Deferred loan costs ( 53 ) ( 230 )

Intangibles ( 33,675 ) ( 35,610 )

2 unchanged sentences

Net deferred tax asset $ 230,262 $ 250,756

(1) Other deferred tax assets includes deferred gains and tax credits in 2022 and 2021, and reverse mortgages in 2022.

(2) Other deferred tax liabilities includes derivatives and partnership investments in 2022 and 2021, and reverse mortgages in 2021.

Included in the table above are deferred taxes recorded in accumulated OCI.

(1) Other deferred tax assets includes deferred gains, tax credits, and reverse mortgages in 2023 and 2022, and employee benefit plans in 2022.

(2) Other deferred tax liabilities includes deferred loan costs, derivatives and partnership investments in 2023 and 2022, and employee benefit plans in 2023.

Included in the table above are deferred taxes recorded in accumulated other comprehensive income (loss).

At December 31, 2023, such items consisted primarily of deferred tax assets of $ 186.8 million of unrealized losses on certain investments in debt securities accounted for under ASC 320 and $ 1.5 million of unrealized losses related to postretirement benefit obligations accounted for under ASC 715.

5 unchanged sentences

This assessment considers, among other matters, the generation of future profitability, the reversal of deferred tax liabilities, and tax planning strategies.

The Company has $ 15.8 million of remaining Federal NOLs.

The Company has $ 13.0 million of remaining Federal net operating losses (NOLs).

Such NOLs expire beginning in 2030 and, due to Internal Revenue Service (IRS) limitations, $ 2.8 million are being utilized each year.

8 unchanged sentences

State tax, net of federal tax benefit 4.4 5.1 3.9

Adjustment to net deferred tax asset for enacted changes in tax laws and rates — — ( 1.2 )

Tax-exempt interest ( 0.6 ) ( 0.5 ) ( 0.2 )

5 unchanged sentences

Nondeductible goodwill — 0.5 —

Surrender of bank-owned life insurance policies 1.9 — —

Other 0.1 ( 0.1 ) ( 0.1 )

Effective tax rate 26.3 % 25.9 % 24.1 %

Section 2303(b) of the CARES act provides the Company with an opportunity to carry back net operating losses (NOLs) arising from 2018, 2019 and 2020 to the prior five tax years.

The Company has such NOLs reflected on its balance sheet as a portion of its current tax receivables, which were previously valued at the federal corporate income tax rate of 21%.

However, the provisions of the CARES Act provide for NOL carryback claims to be calculated based on a rate of 35%, which was the federal corporate tax rate in effect for the carryback years.

Consequently, effective March 31, 2020, the Company has revalued the benefit from its NOLs to reflect a 35% tax rate, which resulted in the recognition of an additional $ 1.7 million income tax benefit and deferred tax asset on the Company's Consolidated Statements of Financial Condition.

ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return.

4 unchanged sentences

ASC 740 also provides guidance on the accounting for and disclosure of unrecognized tax benefits, interest and penalties.

Based on recent changes in the interest rate environment lowering our yields on our Bank Owned Life Insurance (BOLI) policies and the termination of a stable value protection wrap policy, we surrendered $ 65.5 million of previously acquired BOLI policies.

This resulted in a taxable gain of $ 22.6 million and corresponding income tax charge of $ 7.1 million

There were no unrecognized tax benefits as of December 31, 2023.

8 unchanged sentences

The Company's stock incentive plans provide for the granting of stock options, stock appreciation rights, performance awards, restricted stock, restricted stock units (RSUs), performance-based restricted stock units (PSUs) and other stock based awards or cash incentives that are consistent with the purpose of the incentive plans and interests of the Company.

Generally, all time-based awards become fully vested and outstanding stock options and stock appreciation rights become exercisable immediately in the event of a change in control, as defined in the plans.

Upon stockholder approval in 2018, the 2013 Incentive Plan (2013 Plan) was replaced by the 2018 Incentive Plan (2018 Plan).

1 unchanged sentence

The 2018 Plan was amended in 2023 to increase the number of shares of Common Stock available for issuance.

The 2018 Plan will terminate on the tenth anniversary of its effective date, after which no awards may be granted.

The 2018 Plan also includes 261,709 shares from the Bryn Mawr Incentive Plan and the Bryn Mawr Retainer Plan, which were assumed by the Company in connection with the acquisition of Bryn Mawr Bank Corporation.

The number of shares reserved for issuance under the 2018 Plan is 6,261,709 .

In addition, in connection with the BMBC Merger, an additional 261,709 shares were transferred into the 2018 Plan from the Bryn Mawr Incentive Plan and the Bryn Mawr Retainer Plan, which were assumed by the Company.

The 2018 Plan will terminate on the tenth anniversary of its effective date, after which no awards may be granted.

At December 31, 2023, 3,313,543 shares were available for future grants under the 2018 Plan.

During February 2022, the Board of Directors and the Personnel and Compensation Committee (the Committee) approved the Executive Leadership Team Incentive Plan (ELTIP), which provides for new cash and equity awards designed to recognize the rewards and efforts of the Company's executive leadership team for the Company's achievement of certain key measures of short-term success and the value of such success to the Company's longer-term performance.

During February 2022, the Board of Directors and the Leadership and Compensation Committee (the Committee) approved the Executive Leadership Team Incentive Plan (ELTIP), which provides for new cash and equity awards designed to recognize the rewards and efforts of the Company's executive leadership team for the Company's achievement of certain key measures of short-term success and the value of such success to the Company's longer-term performance.

Awards under the ELTIP include short-term incentive (STI) cash bonus awards and long-term incentive (LTI) awards of RSUs and PSUs that will be issued under the Company's 2018 Incentive Plan.

LTI awards under the ELTIP will be awarded to the CEO and Executive Vice Presidents that directly report to the Chairman, CEO and President in the form of RSUs that vest in equal annual installments over a three-year service period, and PSUs that vest based on a service condition defined as the achievement of a three-year service period and a performance condition based on the Company's cumulative core ROA performance over a three-year period relative to the KBW Nasdaq Regional Bank Index (the KRX Index) for the same period.

LTI awards under the ELTIP will be awarded to the CEO and Executive Vice Presidents that directly report to the CEO in the form of RSUs that vest in equal annual installments over a three-year service period, and PSUs that vest based on a service condition defined as the achievement of a three-year service period and a performance condition based on the Company's cumulative core ROA performance over a three-year period relative to the KBW Nasdaq Regional Bank Index (the KRX Index) for the same period.

Total stock-based compensation expense recognized was $ 10.0 million ($ 7.6 million after tax) for 2023, $ 9.0 million ($ 6.7 million after tax) for 2022, and $ 6.3 million ($ 4.8 million after tax) for 2021.

1 unchanged sentence

Stock-based compensation expense related to awards granted to Associates is recorded in Salaries, benefits and other compensation ;

expense related to awards granted to directors is recorded in Other operating expense in the Company's Consolidated Statements of Income.

expense related to awards granted to directors and advisory board members is recorded in Other operating expense in the Company's Consolidated Statements of Income.

Stock Options

Stock options are granted with an exercise price not less than the fair market value of the Company's common stock on the date of the grant.

No stock options were granted during 2022.

All stock options granted during 2021 and 2020 vest in 25 % per annum increments, start to become exercisable in April of the year following the year of grant, and expire between five and seven years from the grant date.

No stock options were granted during 2023 or 2022.

All stock options granted during 2021 vest in 25 % per annum increments, start to become exercisable in April of the year following the year of grant, and expire between five and seven years from the grant date.

New shares are issued upon the exercise of options.

1 unchanged sentence

The model requires the use of numerous assumptions, many of which are subjective.

Significant assumptions used to determine 2021 and 2020 grant date fair value included expected term, which was derived from historical exercise patterns and represents the amount of time that stock options granted are expected to be outstanding;

Significant assumptions used to determine 2021 grant date fair value included expected term, which was derived from historical exercise patterns and represents the amount of time that stock options granted are expected to be outstanding;

volatility, measured using the fluctuation in month end closing stock prices over a period which corresponds with the average expected option life;

1 unchanged sentence

and a dividend yield indicative of the Company's current dividend rate.

The assumptions used to determine the grant date fair value for options issued during 2021 and 2020 are presented below:

The assumptions used to determine the grant date fair value for options issued during 2021 are presented below:

Expected term (in years) 5.5

13 unchanged sentences

Exercisable at end of year 202,994 42.99 2.28 909

The weighted-average fair value of options granted was $ 10.44 in 2021 and $ 7.19 in 2020.

The weighted-average fair value of options granted was $ 10.44 in 2021.

The aggregate intrinsic value of options exercised was $ 0.5 million in 2023, $ 0.8 million in 2022, and $ 1.9 million in 2021.

19 unchanged sentences

The weighted-average period over which the cost is expected to be recognized is 2.02 years.

During 2022, the Company recognized $ 7.5 million of compensation cost related to these awards.

During 2023, the Company recognized $ 6.3 million of compensation expense related to these awards.

The following table summarizes the Company’s RSUs and changes during the year:

20 unchanged sentences

The weighted-average period over which the cost is expected to be recognized is 1.85 years.

During 2022, the Company recognized $ 0.9 million of compensation cost related to these awards.

During 2023, the Company recognized $ 1.6 million of compensation expense related to these awards.

The following table summarizes the Company’s PSUs and changes during the year:

12 unchanged sentences

Thus, 20 % of the restricted stock units subject to the Integration Awards will performance vest and become subject to service-based vesting conditions.

During 2023, the Company recognized $ 0.1 million of compensation expense related to these awards.

Beneficial Acquisition Success Plan:

On December 10, 2020, the Board of Directors approved the Beneficial Acquisition Success Plan (the Success Plan), which was designed to recognize and reward the Company’s achievement of certain key measures of near-term success related to Beneficial and the efforts of the Company’s senior leaders and the value of such success to the Company’s longer term performance.

On December 10, 2020, the Board of Directors approved the Beneficial Acquisition Success Plan (the Success Plan) and granted 66,703 RSUs, vesting in equal installments over three years .

The Success Plan was designed to recognize and reward the Company’s achievement of certain key measures of near-term success related to Beneficial and the efforts of the Company’s senior leaders and the value of such success to the Company’s longer term performance.

The key measures of success related to Beneficial include acquisition economics, one-time acquisition costs, banking location integration and optimization, customer deposit retention, and cost synergies.

Awards under the Success Plan were awarded as RSUs vesting in equal annual installments over three years .

The Company granted 66,703 RSUs under the Success Plan on December 10, 2020.

During 2022, the Company recognized $ 0.7 million of compensation expense related to these awards.

During 2023, the Success Plan awards fully vested and the Company recognized $ 0.6 million of compensation expense related to these awards.

Awards from the Integration Plan and the Success Plan were issued under the Company’s 2018 Incentive Plan.

18 unchanged sentences

Consumer loan commitments (2)

1,363,458 1,011,739

Total $ 4,119,193 $ 2,804,379

At December 31, 2022, the Company had total commitments to extend credit of $ 2.8 billion.

Commitments for consumer lines of credit were $ 1.0 billion of which, $ 913.0 million were secured by real estate.

Residential loan commitments generally have closing dates within a one month period but can be extended to six months .

(1) Not reflected in the table above are commitments to sell residential loans of $ 16.3 million and $ 15.3 million at December 31, 2023 and 2022, respectively.

(2) Consumer loan commitments of $ 633.8 million were secured by real estate.

Commitments provide for financing on predetermined terms as long as the customer continues to meet specific criteria.

15 unchanged sentences

Repurchases and losses have been rare and no provision is made for losses at the time of sale.

There were two repurchases for $ 0.8 million during the year ended December 31, 2022 and no repurchases during the same period in 2021.

There was one repurchase for $ 0.8 million during the year ended December 31, 2023 and two repurchases for $ 0.8 million during the same period in 2022.

Unfunded Lending Commitments

At December 31, 2023 and December 31, 2022, the allowance for credit losses of unfunded lending commitments was $ 12.1 million and $ 11.9 million, respectively.

A provision expense for unfunded lending commitments of $ 0.3 million was recognized during the year ended December 31, 2022, and a provision release for unfunded lending commitments of $ 0.8 million was recognized during year ended December 31, 2021.

A provision expense for unfunded lending commitments of $ 0.2 million was recognized during the year ended December 31, 2023, and a provision expense for unfunded lending commitments of $ 0.3 million was recognized during year ended December 31, 2022.

FAIR VALUE DISCLOSURES OF FINANCIAL ASSETS AND LIABILITIES

127 unchanged sentences

Financial instruments measured at fair value using significant unobservable inputs (Level 3)

The following table provides a description of the valuation techniques and significant unobservable inputs for the Company's financial instruments classified as Level 3:

The following table provides a description of the valuation techniques and significant unobservable inputs for the Company's financial instruments classified as Level 3 as of December 31, 2023 and December 31, 2022:

(Dollars in thousands) December 31, 2023

Financial Instrument Fair Value Valuation Technique(s) Unobservable Input Range (Weighted Average)

Other investments $ 26,120 Observed market comparable transactions Period of observed transactions May 2022

Other investments $ 17,434 Observed market comparable transactions Period of observed transactions December 2023

Other real estate owned 1,569 Fair market value of collateral Costs to sell 10.0 %- 20.0 % ( 18.1 %)

5 unchanged sentences

Other liabilities 14,023 Discounted cash flow Timing of Visa litigation resolution 1.00 - 4.75 years ( 3.06 years or 4Q 2025)

(Dollars in thousands) December 31, 2022

Financial Instrument Fair Value Valuation Technique(s) Unobservable Input Range

(Weighted Average)

Other investments $ 26,120 Observed market comparable transactions Period of observed transactions May 2022

Other real estate owned 833 Fair market value of collateral Costs to sell 10.0 %

Other assets (Risk participation agreements purchased) 81 Credit Value Adjustment

CDS Spread and Loss Given Default (LGD) CDS spread:

110 - 250 bps ( 205 bps)

– % - 30 % ( 30 %)

Other liabilities (Risk participation agreements sold) 2 Credit Value Adjustment

CDS Spread and Loss Given Default (LGD) CDS spread:

1 - 250 bps ( 158 bps)

Other liabilities (Financial derivative related to

sales of certain Visa Class B shares) 17,100 Discounted cash flow Timing of Visa litigation resolution 1.00 - 5.75 years ( 3.61 years or 4Q 2025)

The book value and estimated fair value of the Company's financial instruments are as follows:

28 unchanged sentences

Fair Values of Derivative Instruments

(Dollars in thousands) Notional Balance Sheet Location Derivatives

(Dollars in thousands) Count Notional Balance Sheet Location Derivatives

Derivatives designated as hedging instruments:

Interest rate products 9 $ 750,000 Other assets $ 15,578

Total $ 750,000 $ 15,578

Derivatives not designated as hedging instruments:

2 unchanged sentences

Interest rate lock commitments with customers 34,651 Other assets 637

Interest rate lock commitments with customers 1,179 Other liabilities ( 7 )

Forward sale commitments 1,000 Other assets 1

4 unchanged sentences

Risk participation agreements purchased 116,804 Other assets 78

Financial derivative related to sales of certain Visa Class B shares 113,177 Other liabilities ( 17,100 )

Financial derivative related to sales of

certain Visa Class B shares 113,177 Other liabilities ( 14,023 )

Total derivatives $ 5,997,253 $ 2,005

9 unchanged sentences

Forward sale commitments 20,719 Other liabilities ( 54 )

Risk participation agreements 4,214 Other liabilities ( 3 )

FX forwards 4,177 Other assets 38

FX forwards 3,052 Other liabilities ( 45 )

Risk participation agreements sold 68,459 Other liabilities ( 2 )

Risk participation agreements purchased 87,168 Other assets 81

Financial derivative related to sales of certain Visa Class B shares 113,177 Other liabilities ( 17,100 )

Total derivatives $ 3,921,032 $ ( 16,629 )

Effect of Derivative Instruments on the Income Statement

The table below presents the effect of the derivative financial instruments on the unaudited Consolidated Statements of Income for the years ended December 31, 2023 and December 31, 2022.

Amount of Gain Recognized in OCI on Derivative (Effective Portion) Location of Gain Reclassified from Accumulated OCI into Income (Effective Portion)

(Dollars in thousands) Year Ended December 31,

Derivatives in Cash Flow Hedging Relationships 2023 2022 2021

Interest Rate Products $ 1,596 $ — $ — Interest income

Total $ 1,596 $ — $ —

Amount of (Loss) or Gain Recognized in Income Location of Gain (Loss) Recognized in Income

(Dollars in thousands) Year Ended December 31,

Derivatives Not Designated as a Hedging Instrument 2023 2022 2021

Interest rate products $ 10,294 $ 7,576 $ — Other income

Interest rate lock commitments with customers 274 ( 2,072 ) ( 6,218 ) Mortgage banking activities, net

Forward sale commitments 65 4,863 3,263 Mortgage banking activities, net

FX forwards 130 80 — Other income

Risk participation agreements ( 5 ) ( 195 ) — Other income

Total $ 10,758 $ 10,252 $ ( 2,955 )

Derivatives designated as hedging instruments:

Cash Flow Hedges of Interest Rate Risk

The Company's objectives in using interest rate derivatives are to add stability to interest income and to manage its exposure to interest rate movements.

To accomplish this objective, the Company primarily uses interest rate options, including floors, caps, collars, or swaps as part of its interest rate risk management strategy.

Interest rate options designated as cash flow hedges involve the receipt of fixed amounts from a counterparty in exchange for the Company making variable-rate payments over the life of the agreements without exchange of the underlying notional amount.

The Company has agreements with certain derivative counterparties that contain a provision under which, if it defaults on any of its indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender, then the Company could also be declared in default on its derivative obligations.

The Company also has agreements with certain derivative counterparties that contain a provision where if it fails to maintain its status as a well-capitalized or adequately capitalized institution, then the counterparty could terminate the derivative positions and the Company would be required to settle its obligations under the agreements.

During 2023, the Company purchased nine interest rate floors at a premium of $ 14.7 million with an aggregate notional amount of $ 750.0 million to hedge variable cash flows associated with a variable rate loan pool through the fourth quarter of 2026.

Changes to the fair value of derivatives designated and that qualify as cash flow hedges are recorded in accumulated other comprehensive income (loss) and is subsequently reclassified into earnings in the period that the hedged forecast transaction affects earnings.

If the Company determines that a cash flow hedge is no longer highly effective, future changes in the fair value of the hedging instrument would be reported in earnings.

As of December 31, 2023, the Company determined the cash flow hedges remain highly effective.

During the year ended December 31, 2023, $ 1.2 million of amortization expense on the premium was reclassified into interest income.

The Company does not expect any unrealized gains or losses related to cash flow hedges to be reclassified into earnings in the next twelve months.

In 2020, the Company terminated its three interest rate derivatives that were designated as cash flow hedges for a net gain of $ 1.3 million, recognized in accumulated other comprehensive income (loss).

1 unchanged sentence

As the underlying hedged transaction continues to be probable, the $ 1.3 million net gain will be recognized into earnings on a straight-line basis over each derivative's original contract term.

During the next twelve months, the Company estimates that $ 0.1 million will be reclassified as an increase to interest income.

During the year ended December 31, 2023, $ 0.1 million was reclassified into interest income compared to $ 0.2 million during the same period in 2022.

The table below presents the effect of the cash flow hedges on the Consolidated Statements of Income for the year ended December 31, 2020.

Amount of Gain Recognized in OCI on Derivative (Effective Portion) Location of Gain Reclassified from Accumulated OCI into Income (Effective Portion)

(Dollars in thousands) Year Ended December 31,

Derivatives in Cash Flow Hedging Relationships 2020

Interest Rate Products $ 1,560 Interest income

Total $ 1,560

As of December 31, 2023, this gain has been fully recognized and reclassified to interest income.

Derivatives not designated as hedging instruments:

10 unchanged sentences

The Company may also enter into forward sale commitments to sell loans to investors at a fixed price at a future date and trade asset-backed securities to mitigate interest rate risk.

The table below presents the effect of the derivative financial instruments on the Consolidated Statements of Income for the years ended December 31, 2022, 2021 and 2020.

Amount of (Loss) or Gain Recognized in Income Location of (Loss) or Gain Recognized in Income

(Dollars in thousands) Year Ended December 31,

Derivatives Not Designated as a Hedging Instrument 2022 2021 2020

Interest Rate Lock Commitments $ ( 2,072 ) $ ( 6,218 ) $ 6,490 Mortgage banking activities, net

Forward Sale Commitments 4,863 3,263 ( 12,226 ) Mortgage banking activities, net

Total $ 2,791 $ ( 2,955 ) $ ( 5,736 )

Foreign Exchange Forward Contracts

The Company enters into foreign exchange forward contracts (FX forwards) with customers to exchange one currency for another on an agreed date in the future at an agreed exchange rate.

The Corporation then enters into corresponding FX forwards with swap dealer counterparties to economically hedge its exposure on the exchange rate component of the customer agreements.

The Company then enters into corresponding FX forwards with swap dealer counterparties to economically hedge its exposure on the exchange rate component of the customer agreements.

The FX forwards with both the customers and third parties are not designated as hedges under ASC 815 and are marked to market through earnings.

5 unchanged sentences

The Company may enter into a risk participation agreement (RPA) with another institution as a means to assume a portion of the credit risk associated with a loan structure which includes a derivative instrument, in exchange for fee income commensurate with the risk assumed.

This type of derivative is referred to as an “RPA sold.” In addition, in an effort to reduce the credit risk associated with an interest rate swap agreement with a borrower for whom the Corporation has provided a loan structured with a derivative, the Corporation may purchase an RPA from an institution participating in the facility in exchange for a fee commensurate with the risk shared.

This type of derivative is referred to as an “RPA sold.” In addition, in an effort to reduce the credit risk associated with an interest rate swap agreement with a borrower for whom the Company has provided a loan structured with a derivative, the Company may purchase an RPA from an institution participating in the facility in exchange for a fee commensurate with the risk shared.

This type of derivative is referred to as an “RPA purchased.”

9 unchanged sentences

At December 31, 2023, none of these customer swaps were in a paying position to third parties, with our swap guarantees having a fair value of $ 7.3 million.

At December 31, 2021, 193 of these customer swaps were in a paying position to third parties for $ 35.8 million, with the Company's swap guarantees having a fair value of $ 13.1 million.

However, for both periods, none of the Company's customers were in default of the swap agreements.

At December 31, 2022, none of these customer swaps were in a paying position to third parties, with the Company's swap guarantees having a fair value of $ 10.4 million.

For both periods, none of the Company's customers were in default of the swap agreements.

Credit-risk-related Contingent Features

1 unchanged sentence

The Company has minimum collateral posting thresholds with certain of its derivative counterparties, and has posted collateral of $ 4.7 million in cash against its obligations under these agreements.

The Company has minimum collateral posting thresholds with certain of its derivative counterparties, and has posted collateral of $ 4.3 million in cash against its obligations under these agreements which meets or exceeds the minimum collateral posting requirements.

If the Company had breached any of these provisions at December 31, 2023, it could have been required to settle its obligations under the agreements at the termination value.

3 unchanged sentences

Any related party loans exceeding $ 0.5 million require review and approval by the Board of Directors.

There was no related party loan exceeding $ 0.5 million originated during the year ended December 31, 2022 as compared to one related party loans exceeding $ 0.5 million originated and sold during the year ended December 31, 2021.

There was one extension of credit to related parties exceeding $ 0.5 million originated during the year ended December 31, 2023 and no extensions of credit to related parties originated during the year ended December 31, 2022.

During 2023, all new loans and credit line advances to related parties were $ 4.0 million and repayments were $ 5.6 million.

The outstanding balances of loans to related parties at December 31, 2023 and 2022 were $ 0.4 million and $ 3.9 million, respectively.

Total deposits from related parties at December 31, 2022 and 2021 were $ 5.8 million.

Total deposits from related parties at December 31, 2023 and 2022 were $ 9.7 million and $ 5.8 million.

SEGMENT INFORMATION

11 unchanged sentences

The balance sheet category Cash in non-owned ATMs includes cash from which fee income is earned through bailment arrangements with customers of Cash Connect ® .

The Wealth Management segment provides a broad array of planning and advisory services, investment management, trust services, and credit and deposit products to individual, corporate, and institutional clients through multiple integrated businesses.

Bryn Mawr Trust ® is our predominant Private Wealth Management brand, providing advisory, investment management and trustee services to institutions, affluent and high-net-worth individuals.

The Bryn Mawr Trust Company of Delaware, formed by the merger of BMT-DE and Christiana Trust DE on April 1, 2022, provides personal trust and fiduciary services to families and individuals across the U.S.

and internationally.

WSFS Institutional Services ® provides trustee, agency, bankruptcy administration, custodial and commercial domicile services to institutional, corporate clients and special purpose vehicles.

Private Wealth Management serves high-net-worth clients and institutions by providing trustee and advisory services, financial planning, customized investment strategies, brokerage products such as annuities and traditional banking services such as credit and deposit products tailored to its clientele.

Private Wealth Management, which includes Private Banking, serves high-net-worth clients and institutions by providing trustee and advisory services, financial planning, customized investment strategies, brokerage products such as annuities and customized banking services including credit and deposit products tailored to its clientele.

Private Wealth Management includes businesses that operate under the bank’s charter, through a broker/dealer and as a registered investment advisor (RIA).

1 unchanged sentence

Powdermill® is a multi-family office specializing in providing independent solutions to high-net-worth individuals, families and corporate executives through a coordinated, centralized approach.

BMTIA was a full-service insurance agency, through which the Bank offered insurance and related products and services to its customer base.

This included casualty, property and allied insurance lines, as well as life insurance, annuities, medical insurance and accident and health insurance for groups and individuals.

The BMTIA business was sold to Patriot Growth Insurance Services, LLC in June 2022.

The Bryn Mawr Trust Company of Delaware provides personal trust and fiduciary services to families and individuals across the U.S.

and internationally.

WSFS Institutional Services ® provides trustee, agency, bankruptcy administration, custodial and commercial domicile services to institutional, corporate clients and special purpose vehicles.

The following tables show segment results for the years ended December 31, 2023, 2022, and 2021:

43 unchanged sentences

Noninterest expenses 465,999 36,777 71,550 574,326

Recovery of credit losses ( 113,715 ) — ( 3,372 ) ( 117,087 )

Provision for credit losses 47,921 — 168 48,089

Total external customer expenses 551,313 36,777 75,250 663,340

26 unchanged sentences

Noninterest expenses 328,277 29,465 20,774 378,516

Provision for credit losses 149,453 — 3,727 153,180

Recovery of credit losses ( 113,715 ) — ( 3,372 ) ( 117,087 )

Total external customer expenses 236,620 29,465 18,064 284,149

24 unchanged sentences

Interest income $ 817 $ 374 $ 357

Realized loss on sale of equity investment — ( 706 ) —

Unrealized gains (losses) on equity investments, net 5,379 5,389 ( 1,617 )

Realized gain (loss) on sale of equity investment 9,493 — ( 706 )

Unrealized gains on equity investments, net 2,489 5,379 5,389

Other noninterest income 98,067 251,382 4,759

4 unchanged sentences

Income (loss) before equity in undistributed income of subsidiaries 87,291 233,883 ( 5,480 )

Equity in undistributed (loss) income of subsidiaries ( 12,672 ) 276,208 ( 84,346 )

Equity in undistributed income (loss) of subsidiaries 182,396 ( 12,672 ) 276,208

Income before taxes 269,687 221,211 270,728

Income tax benefit ( 1,164 ) ( 714 ) ( 920 )

Income tax expense (benefit) 531 ( 1,164 ) ( 714 )

Net income attributable to WSFS $ 269,156 $ 222,375 $ 271,442

26 unchanged sentences

Adjustments to reconcile net income to net cash provided by (used for) operating activities:

Equity in undistributed loss (income) of subsidiaries 12,672 ( 276,208 ) 84,346

Realized loss on sale of equity investments — 706 —

Unrealized (gains) losses on equity investments ( 5,379 ) ( 5,389 ) 1,617

Decrease (increase) in other assets 2,569 10,910 ( 4,537 )

Equity in undistributed (income) loss of subsidiaries ( 182,396 ) 12,672 ( 276,208 )

Realized (gain) loss on sale of equity investments ( 9,493 ) — 706

Unrealized gains on equity investments ( 2,489 ) ( 5,379 ) ( 5,389 )

Decrease in other assets 31,254 2,569 10,910

Increase (decrease) in other liabilities 3,488 812 ( 6,690 )

5 unchanged sentences

Issuance of common stock and exercise of common stock options $ 3,298 $ 3,179 $ 1,522

Issuance of senior debt — — 147,780

Redemption of senior debt — ( 100,000 ) —

Redemption of senior and subordinated debt ( 30,000 ) — ( 100,000 )

Purchase of treasury stock ( 54,647 ) ( 200,083 ) ( 13,268 )

1 unchanged sentence

Net cash used for financing activities $ ( 118,091 ) $ ( 232,650 ) $ ( 135,988 )

Increase (decrease) in cash and cash equivalents $ 102,133 $ ( 141,217 ) $ 173,495

Decrease (increase) in cash and cash equivalents $ ( 8,571 ) $ 102,133 $ ( 141,217 )

Cash and cash equivalents at beginning of period 205,841 103,708 244,925

1 unchanged sentence

CHANGE IN ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Accumulated other comprehensive income (loss) includes unrealized gains and losses on available-for-sale investments, unrealized gains and losses on cash flow hedges, as well as unrecognized prior service costs, transition costs, and actuarial gains and losses on defined benefit pension plans.

Accumulated other comprehensive income (loss) includes unrealized gains and losses on available-for-sale investments, unrealized gains and losses on cash flow hedges, as well as unrecognized prior service costs, and actuarial gains and losses on defined benefit post-retirement plans.

Changes to accumulated other comprehensive income (loss) are presented net of tax as a component of stockholders' equity.

12 unchanged sentences

Balance, December 31, 2020 $ 59,882 $ 276 $ ( 4,788 ) $ 646 $ ( 9 ) $ 56,007

Other comprehensive income (loss) before reclassifications 39,853 — ( 1,445 ) 1,560 ( 9 ) 39,959

Amounts reclassified from accumulated other comprehensive (loss) income ( 6,898 ) ( 192 ) ( 26 ) ( 337 ) — ( 7,453 )

Net current-period other comprehensive income (loss) 32,955 ( 192 ) ( 1,471 ) 1,223 ( 9 ) 32,506

Balance, December 31, 2020 $ 59,882 $ 276 $ ( 4,788 ) $ 646 ( 9 ) $ 56,007

Other comprehensive (loss) income before reclassifications ( 93,503 ) — 162 — 362 ( 92,979 )

7 unchanged sentences

Balance, December 31, 2022 $ ( 563,533 ) $ ( 108,503 ) $ ( 4,482 ) $ 108 $ 566 $ ( 675,844 )

(1) Cash flow hedges were terminated as of April 1, 2020.

Other comprehensive income (loss) before reclassifications 63,601 — 132 1,596 ( 85 ) 65,244

Amounts reclassified from accumulated other comprehensive income (loss) — 16,980 ( 264 ) ( 107 ) — 16,609

Net current-period other comprehensive income (loss) 63,601 16,980 ( 132 ) 1,489 ( 85 ) 81,853

Balance, December 31, 2023 $ ( 499,932 ) $ ( 91,523 ) $ ( 4,614 ) $ 1,597 $ 481 $ ( 593,991 )

(1) Includes amortization of net gain for cash flow hedges terminated as of April 1, 2020.

(2) Includes $ 119.8 million, net of tax, of unrealized losses on transferred investment securities from available-for-sale to held-to-maturity.

7 unchanged sentences

Net of tax $ — $ — $ ( 252 )

Net unrealized holding gains on securities transferred between available-for-sale and held-to-maturity:

Amortization of net unrealized gains to income during the period $ 14,593 $ ( 133 ) $ ( 251 ) Interest and dividends on

Net unrealized holding losses (gains) on securities transferred between available-for-sale and held-to-maturity:

Amortization of net unrealized losses (gains) to income during the period $ 22,343 $ 14,593 $ ( 133 ) Interest and dividends on

investment securities

8 unchanged sentences

Net of tax $ ( 264 ) $ ( 109 ) $ ( 65 )

Defined benefit pension plan settlement:

Realized losses on plan settlement $ — $ — $ 279 Other operating expense

Income taxes — — ( 67 ) Income tax provision

Net of tax $ — $ — $ 212

Net unrealized gains on terminated cash flow hedges:

8 unchanged sentences

There were no material changes or additions to other significant pending legal or other proceedings involving the Company other than those arising out of routine operations.

SUBSEQUENT EVENTS

The Company evaluated subsequent events in accordance with ASC Topic 855 and determined that the following qualifies as a non-recognized subsequent event:

Extinguishment of Debt

On February 15, 2023, the Company completed the redemption of the $ 30.0 million of fixed-to-floating rate subordinated notes due 2025 (the 2025 Notes) acquired from Bryn Mawr Trust.

The 2025 Notes were redeemed at a price of 100 %, plus accrued and unpaid interest through the date of redemption.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data