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PenFed Credit Union's Impressive Performance in Q3 2025

PenFed Credit Union, recognized as one of America's leading federal credit unions, has announced a remarkable financial performance through the third quarter of 2025. With an impressive growth trajectory marked by significant earnings, capital, and liquidity, the institution stands out in a competitive financial landscape.

As of the end of Q3 2025, PenFed boasted close to 2.8 million members and an impressive asset base of $29 billion, alongside a substantial net worth exceeding $2.9 billion. This robust state of affairs is underscored by powerful growth metrics across various financial indicators, pointing toward a well-managed credit union that prioritizes its members' interests.

Financial Strength and Liquidity

In terms of capital and liquidity, PenFed demonstrated significant strength. The net worth ratio soared by 32 basis points quarter-over-quarter and 80 basis points year-over-year, demonstrating the credit union's financial stability. By closing the quarter with over $1 billion of capital surpassing the required regulatory minimum, PenFed ensured it remains well-capitalized. This capital increased by 7% compared to the previous quarter and by 14% year-over-year.

Moreover, total cash and investments rose to 15.0% of total assets, reflecting a year-over-year increase of 59 basis points. These figures illustrate PenFed's commitment to maintaining a solid liquidity position while managing risk effectively.

Earnings Growth

PenFed's financial health was further highlighted by its impressive earnings growth. The credit union reported a 21% increase in net income compared to the previous quarter and an astonishing 121% increase year-over-year. By achieving a year-to-date net income of $111.8 million—an increase of 91% from the previous year—PenFed solidified its financial standing.

The improvement in net interest margin also points to effective asset and liability management, climbing 18 basis points year-over-year to reach 3.20%. Such results indicate that PenFed effectively navigates the complexities of the financial market while remaining focused on providing value to its members.

Credit Quality and Risk Management

PenFed's emphasis on sound lending practices is evident in its improved credit quality metrics. The loan loss rates have seen a decline of 7% from the previous quarter and 9% year-over-year, with even better results noted when excluding commercial real estate exposure. The delinquency rate of the loan portfolio decreased by 35 basis points year-over-year to stand at 1.47%, thanks to an effective focus on resilient lending strategies and improved credit performance.

Additionally, the credit union managed to reduce its commercial real estate exposure by 3% quarter-over-quarter and 42% year-over-year, showcasing a proactive approach to risk management.

Growth in Loans and Deposits

PenFed also experienced a thriving demand for its loan products. Year-to-date, auto loan originations grew by 28% year-over-year, reaching $1.4 billion, while home equity line of credit (HELOC) originations rose by 15% year-over-year to $1.0 billion. This growth reflects the increasing reliance on PenFed’s competitive rates among its members.

Moreover, the total of non-maturity deposits surged by 8% year-over-year to $14.6 billion, driven in part by the popularity of premium online savings accounts.

Commitment to Community

PenFed's success goes beyond its financial metrics. The credit union actively invests in its members and the communities it serves, evidenced by the donation of over $1.1 million to 45 charitable organizations within the first nine months of 2025. Support for veterans, military families, and children facing critical health challenges highlights PenFed's commitment to social responsibility alongside its financial objectives.

Outlook

Looking forward to the fourth quarter, CEO James Schenck noted the recent Federal Reserve actions to lower short-term interest rates by 25 basis points, indicating a positive outlook for consumers as borrowing costs decrease. Schenck emphasized PenFed's commitment to supporting its members through various economic environments, reinforcing the institution's position as a reliable partner in achieving their financial goals.

With a foundation built on strong financial performance and community service, PenFed Credit Union continues to position itself as a leader in the credit union sector, focused on empowering its members as they navigate their financial journeys.