Webster Financial: 2Q‘26 Earnings: Mixed Quarter as Softer NIM Weighs on NII

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Webster Financial: 2Q‘26 Earnings: Mixed Quarter as Softer NIM Weighs on NII

USA | Large-Cap & Mid-Cap Banks

Webster Financial EquityJulyResearch22, 2026

TARGET CHANGE2Q'26 Earnings: Mixed Quarter as Softer NIM

RATING HOLDWeighs on NII

PRICE $76.07^

Webster posted a mixed quarter as it awaits the close of its pending acquisition

by Banco Santander, still expected in 2H'26. Core EPS came in modestly below PRICE TARGET | % TO PT $77.00 ($78.00) | +1%

expectations, driven largely by a lower than expected NIM (reflecting a modest 52W HIGH-LOW $77.69 - $52.69

Q/Q decline in asset yields and modestly higher deposit costs) which pressured FLOAT (%) | ADV MM (USD) 99.2% | 283.54

NII. Expenses were also higher than expected, but this was partially offset by a MARKET CAP $12.3B

lower provision and better than expected fees. TICKER WBS ^Prior trading day's closing price unless otherwise

noted.

Key trends. Core EPS of $1.60 was below our estimate of $1.62 and consensus estimates of

$1.64. Core PPNR of $380 mn missed our estimate of $400 mn and consensus estimate of $397

FY (Dec) CHANGE TO JEFe JEF vs CONS

mn. Webster reported loan (avg) growth of 3% annualized, below our 5% forecast, as strength in

2026 2027 2026 2027

commercial non-mortgage lending was largely offset by flat commercial real estate and residential

mortgage balances and modest declines in asset-based lending and consumer loans. Deposit EPS* -2% -2% -2% -3%

(avg) growth of 2% annualized came in above our forecast for flat growth, though the mix shifted REV* <-1% <-1% -1% NM

unfavorably as NIB deposits declined. Net interest income fell short of expectations, driven by a

lower-than-expected NIM, which compressed 10 bps Q/Q to 3.26% (vs. our 3.36% forecast and 2026 ($) Q1A Q2A Q3 Q4 FY