Flagstar Bank (FLG) Q3 2025 earnings summary

Executive summary

• Net loss attributable to common stockholders narrowed to $45 million ($0.11 per diluted share) in Q3 2025, a 44% improvement from Q2 2025 and 86% better year-over-year; adjusted net loss was $31 million ($0.07 per diluted share), a 50% sequential improvement and 89% better year-over-year.

• Operating results improved with higher pre-provision net revenue, strong C&I loan growth, expanding net interest margin, and reduced operating expenses.

• Completed holding company reorganization in October 2025, simplifying structure and reducing regulatory burden.

• CRE and multifamily portfolios were proactively reduced, with $1.3 billion in payoffs supporting concentration reduction and portfolio diversification.

• Strategic initiatives and cost controls drove improved earnings profile and positioned for near-term profitability.

Financial highlights

• Net interest income for Q3 2025 was $425 million, up 1% sequentially but down 17% year-over-year; net interest margin rose to 1.91%, up 10 bps from Q2 2025 and 12 bps year-over-year.

• Adjusted net loss per diluted share was $0.07, significantly improved from the prior quarter and in line with consensus.

• Adjusted operating expenses fell 30% year-over-year to $457 million, reflecting $800 million in annualized reductions.

• CET1 capital ratio improved to 12.45%, among the highest in the peer group.

• Non-interest income was $94 million, up 22% sequentially due to a $21 million gain on Figure Technology Solutions, Inc.

Outlook and guidance

• Profitability expected in Q4 2025, with ongoing cost reduction, efficiency gains, and continued NIM expansion.

• Full-year 2025 adjusted diluted EPS forecasted at a range of -$0.36 to -$0.41 per share; 2026 and 2027 guidance unchanged.

• Net interest income guidance: $1.7–$1.75B for 2025, rising to $2.9–$3.0B by 2027.

• Balance sheet expected to bottom at $90–$91 billion in Q4 2025, with growth resuming in 2026 and reaching $108–$109 billion by 2027.

• C&I loan originations projected at $1.7–$2.2 billion per quarter, with further growth anticipated as new hires ramp up.