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WBS, Webster Financial

Banks financial

A balance-sheet business, read on book value, net interest margin and credit losses rather than an earnings multiple.

Latest annual: FY2025 10-K

WBS · Webster Financial

The business

What it sells, where the money comes from, the kind of company it is.

Revenue · FY2025

$2.9B

+11.9% YoY · 20% 5-yr CAGR

Vital signs · TTM, with 5-yr average

Revenue $2.9B 5-yr avg $2.4B

Return on equity 11% 5-yr avg 10%

Return on tangible equity 16% 5-yr avg 14%

Efficiency ratio 50% 5-yr avg 54%

Equity / assets 11.2% 5-yr avg 11.1%

The business in brief

read the 10-K →

What this business is and what moves its needle, from its own SEC filings.

What moves the needle: Net interest margin, loan losses, and book value. A lender is read on the quality of its balance sheet, not an earnings multiple, and the worst year of credit losses matters more than the best. On its own account, the filing leans hardest on pricing power & competition, set against the numbers in what the filing emphasizes, below.
Is it a good business?: Return on equity has sat below the cost of equity (median 10%, above 12% in only 1 of 10 years). It runs at a 50% efficiency ratio, lean. The cycle and the loan book decide this one; weigh the recession years in the record, not the average, and read the 10-K.

Every line is arithmetic on the company's filings, shown in full in the sections below.

The record

Ten years of arithmetic, read across the cycle.

The record, 2016–2025

realized figures from each filing · older years to the left

2016’16	2017’17	2018’18	2019’19	2020’20	2021’21	2022’22	2023’23	2024’24	2025’25	TTMTTMMar 2026
											Income statement
$983M	$1.1B	$1.2B	$1.2B	$1.2B	$1.2B	$2.5B	$2.7B	$2.6B	$2.9B	$2.9B	RevenueRevenue
$719M	$796M	$907M	$955M	$891M	$901M	$2.0B	$2.3B	$2.3B	$2.5B	$2.5B	Net interest incomeNet int.
$264M	$259M	$283M	$285M	$285M	$323M	$441M	$314M	$252M	$402M	$410M	Noninterest incomeFee inc.
$56M	$41M	$42M	$38M	$138M	($55M)	$281M	$151M	$222M	$210M	$187M	Credit-loss provisionProvision
$207M	$255M	$360M	$383M	$221M	$409M	$644M	$868M	$769M	$1.0B	$1.0B	Net incomeNet inc.
32%	28%	18%	21%	21%	23%	19%	20%	24%	20%	20%	Effective tax rateTax rate
											Cash flow & returns
0.8%	1.0%	1.3%	1.3%	0.7%	1.2%	0.9%	1.2%	1.0%	1.2%	1.2%	Return on assetsROA
8%	9%	12%	12%	7%	12%	8%	10%	8%	11%	11%	Return on equityROE
5%	6%	9%	8%	2%	8%	5%	7%	5%	8%	8%	Retained to equityRetained/eq
11%	12%	16%	14%	8%	14%	12%	15%	13%	16%	16%	Return on tangible equityROTCE
63%	63%	59%	58%	64%	61%	56%	53%	52%	49%	50%	Efficiency ratioEffic.
											Balance sheet
$26.1B	$26.5B	$27.6B	$30.4B	$32.6B	$34.9B	$71.3B	$74.9B	$79.0B	$84.1B	$85.6B	Total assetsAssets
$19.3B	$21.0B	$21.9B	$23.3B	$27.3B	$29.8B	$54.1B	$60.8B	$64.8B	$68.8B	$69.0B	DepositsDeposits
$538M	$538M	$538M	$538M	$538M	$538M	$2.5B	$2.6B	$2.9B	$2.9B	$2.9B	GoodwillGoodwill
$2.5B	$2.7B	$2.9B	$3.2B	$3.2B	$3.4B	$8.1B	$8.7B	$9.1B	$9.5B	$9.6B	Shareholders’ equityEquity
											Per share
91.9M	92.4M	92.2M	91.9M	90.2M	90.2M	168M	172M	170M	165M	160M	Shares out (diluted)Shares
$2.25	$2.77	$3.91	$4.17	$2.45	$4.53	$3.85	$5.05	$4.52	$6.07	$6.39	EPS (diluted)EPS
$0.97	$1.02	$1.25	$1.53	$1.61	$1.61	$1.48	$1.62	$1.61	$1.62	$1.64	Dividends / shareDiv/sh
$27.51	$29.26	$31.30	$34.91	$35.88	$38.12	$48.08	$50.56	$53.66	$57.46	$59.89	Book value / shareBVPS
$21.28	$23.11	$25.18	$28.81	$29.66	$31.95	$31.89	$34.07	$34.85	$38.02	$39.89	Tangible book / shareTBVPS

The diluted share count moved ×1.86 into 2022 — shares issued, not a split the totals corroborate — and the per-share figures carry the counts as filed.

Per-share growththe realized rate an owner's share compounded

	9-yr	5-yr
Revenue / share	+5.7%/yr	+6.1%/yr
Owner earnings / share	+5.1%/yr	+8.9%/yr
EPS	+11.6%/yr	+19.9%/yr
Dividends / share	+5.8%/yr	+0.1%/yr
Capital spending / share	−4.2%/yr	+4.9%/yr
Book value / share	+8.5%/yr	+9.9%/yr

The record, charted

FY2016–2025

Each measure over its full record; the current point and the worst year marked.

Share count

165Mpeak FY2023

Revenue

$2.9Blow FY2016

III

Quality & stewardship

Returns, the balance sheet, capital allocation, and pay.

Owner’s Scorecard

FY2025 10-K · source on SEC EDGAR →

Is it a good business?

Return on equity 11%

Adequate

Net income $1.0B ÷ equity $9.5B

Industry peers: median 10%

What this means
The bank's north star, what it earns on shareholders' capital. Cost of equity is roughly 10%, so a return durably above that builds value and below it destroys it. One year is noisy; the durability across a full credit cycle is what counts.
Return on tangible equity 16%

Strong

Net income ÷ (equity − goodwill $2.9B − intangibles $313M)

Industry peers: median 13%

What this means
The cleaner return, stripping out the goodwill paid for past acquisitions. This is the number a buyer of the whole bank actually earns on the hard capital.
Efficiency ratio 49%

Low cost ratio (<58%)

Noninterest expense $1.4B ÷ (net interest income + fees)

Industry peers: median 62%

What this means
The share of revenue eaten by running costs; lower is better, and below about 60% marks a genuinely efficient operation. A low ratio held for years is the operational side of a moat.

Is it sound?

Capital (equity / assets) 11.3%

Well capitalized

Equity $9.5B ÷ assets $84.1B

What this means
A plain-English leverage read: how much of the balance sheet is the owners' own money. This is a rough proxy; the regulatory figure is the CET1 ratio, which is risk-weighted and reported in the filing. The point is the same, how much loss the bank can absorb before depositors are at risk.
Deposit funding 82%

Deposit-funded

Deposits $68.8B ÷ assets $84.1B

What this means
Low-cost, sticky deposits are a bank's real moat, the cheap raw material it lends out at a spread. A bank funded mostly by deposits earns more durably than one that rents its money in the wholesale market.
Credit cost (provision / NII) 8%

Low

Provision for credit losses $210M ÷ net interest income $2.5B

What this means
What the bank set aside this year against loans going bad, as a share of its lending income. This swings hard with the cycle, low in good years and spiking in recessions, so read it across the record, not in one year. Disciplined underwriting shows up as low, stable provisions through a downturn.

Does AI threaten the moat?

Low contestability

The moat is physical, regulated or balance-sheet-funded, the kind AI cuts costs within but does not contest.

In its own filing Raised, but not as a competitor

The filing raises AI among its risks, but in other terms (security, regulation, energy or the like), not as a competitor to its product.

AI is unlikely to contest a moat that is physical, regulated or balance-sheet-funded; here it reads more as a cost tool than a threat.

Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.

All figures as filed; the source filing is linked above.

Management, ownership & pay

read the proxy →

From the proxy: how much of the business the people running it own, and how they are paid, beside what the business earned for its owners in the same years.

Fiscal year	Pay, as filed	“Actually paid”	Owner earnings
2020	$3.5M	$2.7M	$359M
2021	$4.7M	$5.8M	$672M
2022	$8.1M	$7.0M	$1.3B
2023	$7.7M	$9.2M	$938M
2024	$6.1M	$6.0M	$1.4B

Both pay figures are the company’s own, from the pay-versus-performance table its proxy statement files. “As filed” is the Summary Compensation Table total: salary, bonus, and equity awards at their value on the day of grant. “Actually paid” is the SEC’s prescribed recalculation, which re-marks those equity awards to what they became as they vested; it can swing far above or below the filed figure in either direction, and negative years occur. Owner earnings are the whole business's, from the record above, for the same fiscal years.

Insider ownership<1%
The stake all directors and executive officers hold together, per the 2025 proxy: skin in the game, the first thing Munger reads.
CEO pay ratio66:1
What the chief earns for every dollar the median employee makes, per the 2025 proxy. A high ratio alone settles nothing; some businesses are genuinely top-heavy in scarce skill. A runaway figure is where Buffett starts asking whether the board is doing its job.
Stock-based compensation$57M
The slice of the business handed to employees in shares this year, 2% of revenue, equal to 4% of operating profit. Buffett's oldest accounting fight: this is compensation, compensation is an expense, real whether or not the headline earnings admit it. One trap: the cash-flow statement adds SBC back, so the operating cash, and the owner earnings drawn from it, are flattered by exactly this amount; counted as the cost it is, what an owner keeps is lower.

Peers, Banks

The same industry, side by side on the bank lens. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.

Company	Revenue	ROE	ROTCE	Efficiency	NII / assets
FHNFirst Horizon	$3.4B	10%	14%	63%	2.9%
ZIONZions Bancorporation N.A.	$3.4B	12%	14%	62%	2.9%
WBSWebster Financial	$2.9B	10%	14%	59%	3.0%
UMBFUMB Financial	$2.7B	10%	12%	67%	2.4%
ONBOld National Bancorp	$2.5B	8%	13%	63%	2.8%
CFRCullen/Frost Bankers	$2.2B	12%	14%	62%	2.8%
PNFPPinnacle Financial Partners	$2.1B	9%	10%	57%	2.7%
VLYValley National Bancorp	$2.0B	8%	11%	58%	2.7%
Group median	—	10%	13%	62%	2.8%

The price

What a price has to assume.

What the price implies

price / tangible book

A bank is worth a multiple of its tangible book value, and the multiple it deserves is set by the return it earns on that book. Type today’s price; we show what you would be paying against what Webster Financial’s record justifies.

Today’s price $

The assumptions Cost of equity 10% Long-term growth 3%

Tangible book / share, delivered5%/yr’20→’25

The justified multiple is (return on tangible equity − growth) ÷ (cost of equity − growth). A bank earning exactly its cost of equity is worth about one times tangible book; the premium above that prices each point of durable excess return. A higher cost of equity lowers the justified multiple for a bank.

Enter a price above to run it.

Price / tangible book—

Justified by the return—

Normalized return on tangible equity14%

Price / book—

Earnings yield—

P/E (3-yr avg ’23–’25)—

Graham’s price gate—

Graham applied the same standards to financial enterprises (Intelligent Investor ch.14): the 15× multiple cap on averaged earnings, and P/E times price-to-book at most 22.5. The gate marks the bargain-hunter’s floor, not a verdict.

Tangible book $6.4B on 162M shares, a 14% normalized return on it. The dials set the multiple such a return would justify; your price sets the multiple you are paying. It assumes the bank keeps earning that return; a credit cycle, a rate shock or a bad acquisition changes it, which is what the record and the 10-K are for.

Weigh WBS against another business →

Cite: Owner Scorecard, "Webster Financial (WBS), the owner's record," https://ownerscorecard.com/c/WBS, data as of 2026-07-09.

Manual order: ← WBI its page in the Manual WBTN →

Industry order: ← WASH the Banks chapter WF →