What happened with PFS today?
No read yet
Uses news and trading volume to explain the day’s move and how it relates to the market.
Stop guessing. Get the call, a three-month target price, the best and worst cases, and a source for every claim.
Provident Financial Services is the holding company for Provident Bank, which serves businesses and individuals in New Jersey, Pennsylvania and New York. The bank gathers deposits from local customers and uses that money, supplemented by borrowings, to lend to property owners, businesses and households. Commercial property, including apartment buildings, and business lending make up most of its loan portfolio. Borrowers’ interest payments supply most of its income; securities investments provide additional interest income. Its main earnings source is what remains after paying interest on deposits and borrowings.
The bank also earns account and lending fees. Beacon Trust Company provides wealth management and trust services, with most wealth-management fees tied to the assets it manages. Provident Protection Plus earns commissions by arranging customers’ insurance coverage with insurers.
The business depends on retaining deposits, managing the gap between lending yields and funding costs, and collecting repayments. Its substantial exposure to New Jersey borrowers and property makes local business and real estate conditions especially important. Following the Lakeland merger, the bank must meet additional capital requirements and keep commercial real estate concentrations within regulatory limits for a three-year period. The holding company receives most of its own income as subsidiary dividends, which are subject to capital requirements and other legal and regulatory restrictions.
The risk section is the longest, dullest part of the filing. This keeps only what can really hurt you: where it hits, how hard, when it plays out.
Every company claims an edge. Each one is checked against hard numbers like margins and returns: which hold, and which line gives way first.
Kearny Financial’s Kearny Bank competes with Provident for New Jersey savers and property borrowers, and both have substantial exposure to apartment-building and commercial property mortgages. Watch Kearny’s lending in those two categories as a comparison for Provident’s property-loan business.
Fulton Financial competes with Provident in New Jersey and Pennsylvania for small and medium-sized business borrowers, commercial mortgage customers, deposits and clients paying for wealth services. Its lending to those businesses is a useful comparison for Provident’s efforts to expand commercial customer relationships.
WSFS Financial Corp competes with Provident for business banking, deposits and wealth clients in Greater Philadelphia and eastern Pennsylvania. Watch its commercial loans and leases and its Wealth and Trust business, rather than its nationwide ATM cash services, to compare the businesses that overlap with Provident.
BCB Bancorp Inc’s BCB Community Bank competes with Provident in New Jersey for local deposits and borrowers seeking commercial property, apartment-building and business loans.
BankUnited competes with Provident for commercial borrowers and deposits in metropolitan New York, but Florida is its largest market. Its New York business is the closer comparison for Provident, particularly lending and deposit services for small and middle-market companies.
Ponce Financial Group and Provident both seek depositors and real estate borrowers in New York City and northern New Jersey, though Ponce focuses on immigrant communities. Ponce’s lending and commercial deposits from immigrant property investors and developers offer a narrower view of those shared markets.
Magyar Bancorp competes with Provident for deposits and small-business borrowers in central and northern New Jersey, though Magyar is substantially smaller. Its deposits around New Brunswick and its Middlesex and Somerset County branches are the most direct local comparison.
S&T Bancorp and Provident both provide Pennsylvania individuals and small and medium-sized businesses with loans, deposit accounts and paid wealth services. S&T’s focus on those customers rather than large corporations makes its consumer and business lending the relevant comparison.
Eastern Bankshares is an operating comparison for Provident rather than a local rival: both run similarly sized banks that use customer deposits to fund loans and sell wealth services. Watch the gap between loan interest earned and deposit interest paid, since commercial loan demand and deposit pricing matter to both despite their different local markets.
Hope Bancorp’s Bank of Hope competes with Provident for commercial and real estate borrowers and deposits in New York and New Jersey, though most of its branches are elsewhere. Its lending and deposit business in those two states is the relevant comparison, not its wider branch network.
Fulton Financial Corp earningsFULT
Fulton competes with Provident for business and commercial-property borrowers in New Jersey and Pennsylvania, and its report will show whether those customers are still taking loans from banks.
Read Fulton's business and commercial-property lending alongside its deposit trend. Lending growth with steady deposits would show that it is attracting business borrowers and has funding for them, keeping competition alive for Provident; weaker lending would point to cooling borrowing or tighter bank lending, though the loan figures alone cannot distinguish between them.
Kearny Financial Corporation earningsKRNY
Kearny competes with Provident for New Jersey depositors and property borrowers, and its report will show whether apartment-building and other commercial-property lending there is holding up.
Read Kearny's apartment-building and other commercial-property lending alongside its deposits. Steady property lending with stable deposits would show that borrowers in New Jersey are still seeking loans and banks have funding to provide them; a lending pullback could mean weaker borrowing, tighter credit, or both. It offers a local comparison for Provident's large property-loan business, but cannot by itself establish the cause.
Provident Financial Services, Inc. earningsThis company
Provident uses customer deposits to fund commercial-property and business loans, and its report will show whether loan interest covers funding costs and borrowers keep up with payments.
Read net interest margin—the interest earned on loans and investments after funding costs, relative to earning assets—alongside delinquencies and credit-loss provisions for commercial-property and business loans. A steady or wider margin with contained delinquencies and provisions would show that deposits still fund profitable lending and borrowers are paying; a narrowing margin or weaker loan quality would show funding costs or credit losses squeezing that business.
Fed Interest Rate Decision
The Fed’s rate decision signals whether borrowing costs across the economy are rising or falling, affecting what Provident Bank earns on loans and pays for deposits and other funding.
Expected4.0%Last release4.0%
If it comes in above expectations
If rates rise, costs on deposits and other funding may increase faster than yields on Provident Bank’s loans and investments, squeezing the difference it earns; borrowers may also face higher costs on loans that reprice or new borrowing.
If it comes in below expectations
If rates fall, yields on Provident Bank’s loans and investments may decline faster than its deposit and other funding costs, narrowing the difference it earns; borrowers may also pay less on loans that reprice or new borrowing.
