Flagstar Bank Q1 Profit $13M, C&I Loans Up $1.4B and 9%
Flagstar Bank reported Q1 2026 net income to common of $13M, or $0.03 per share, and adjusted net income per share of $0.04. C&I loans grew $1.4B (9%), core deposits rose $1.1B (2%), non-accrual loans fell 11%, NIM expanded 10bps to 2.15%, and CET1 ratio increased to 13.24%.
1. Net Income and Profitability Performance
Flagstar Bank reported net income attributable to common stockholders of $13 million, or $0.03 per diluted share, in Q1 2026, versus $21 million ($0.05) in the prior quarter and a loss of $108 million ($0.26) a year earlier. Adjusted net income rose to $20 million, or $0.04 per share, excluding a $9 million equity investment loss.
2. Lending and Deposit Growth
Total C&I loans increased by $1.4 billion, or 9%, to $16.6 billion, driven by growth in Specialized Lending and Corporate and Regional Commercial Banking. Core deposits, excluding brokered, rose $1.1 billion (2%), while brokered deposits and wholesale borrowings declined by $298 million (12%) and $1 billion (9%), respectively.
3. Asset Quality and Capital Strength
Non-accrual loans fell $323 million (11%) and criticized/classified loans declined $323 million (3%), while CRE exposures shrank $1.6 billion (4%) with $1.1 billion in payoffs. Net interest margin expanded to 2.15%, up 10 basis points adjusted, operating expenses dropped 5%, and the CET1 ratio strengthened to 13.24% with $1.6 billion in excess capital.