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Capitol Federal Financial, Inc.

For the period ended Jun 30, 2026. Filed Aug 7, 2026.

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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.

Jun 30, 2026 · Filed Aug 7, 2026

CFFN$8.60+2.0%Stored close · as of Nov 9, 2026

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Financial Condition - Asset Quality

Asset Quality

Delinquent and nonaccrual loans and OREO. The following table presents the Bank's 30 to 89 day delinquent loans at the dates indicated. The amounts in the table represent the unpaid principal balance of the loans less related charge-offs, if any. Of the loans 30 to 89 days delinquent at June 30, 2026, approximately 81% were 59 days or less delinquent.

June 30, · March 31, · December 31,
202620262025
CountAmountCountAmountCountAmount
(Dollars in thousands)
One- to four-family:
Originated63$7,06365$6,62483$9,351
Purchased92,209102,366215,767
Commercial:
Commercial real estate42,04071,55462,584
Commercial and industrial102,132877151,039
Consumer194992257029635
105$13,943112$11,885144$19,376
Loans 30 to 89 days delinquent
to total loans receivable, net0.17%0.15%0.24%

The following table presents the Bank's nonaccrual loans and OREO at the dates indicated. Non-performing assets consist of nonaccrual loans and OREO. The amounts in the table represent the unpaid principal balance of the loans less related charge-offs, if any. Nonaccrual loans are loans that are 90 or more days delinquent or in foreclosure and other loans required to be reported as nonaccrual pursuant to the Bank's internal policies, even if the loans are current. At all dates presented, there were no loans 90 or more days delinquent that were still accruing interest.

June 30, · March 31, · December 31,
2026 · 2026 · 2025
Count · Amount · Count · Amount · Count · Amount
(Dollars in thousands)
Loans 90 or More Days Delinquent or in Foreclosure:
One- to four-family:
Originated33$3,98031$4,13029$3,223
Purchased123,694155,60661,469
Commercial:
Commercial real estate102,821122,634123,358
Commercial and industrial414449992199
Consumer917697214218
6810,8157113,441638,467
Loans 90 or more days delinquent or in foreclosure
as a percentage of total loans0.13%0.17%0.10%
Nonaccrual loans less than 90 Days Delinquent:(1)
Commercial:
Commercial real estate5$39,9696$41,0574$40,338
Commercial and industrial85007410177
1340,4691341,467540,415
Total nonaccrual loans8151,2848454,9086848,882
Nonaccrual loans as a percentage of total loans0.63%0.68%0.60%
OREO:
One- to four-family:
Originated(2)—$——$—2$291
Consumer——11351135
——11353426
Total non-performing assets81$51,28485$55,04371$49,308
Non-performing assets as a percentage
of total assets0.53%0.56%0.50%

(1)Includes loans required to be reported as nonaccrual pursuant to internal policies, even if the loans are current.

(2)Real estate-related consumer loans where we also hold the first mortgage are included in the one- to four-family category as the underlying collateral is one- to four-family property.

The following table presents the states where the properties securing ten percent or more of the total amount of the Bank's one- to four-family loans, excluding construction loans, are located and the corresponding balance of loans 30 to 89 days delinquent, 90 or more days delinquent or in foreclosure, and weighted average LTV for loans 90 or more days delinquent or in foreclosure at June 30, 2026. The amounts in the table represent the unpaid principal balance of the loans, less related charge-offs, if any. The LTVs were based on the current loan balance and either the lesser of the purchase price or original appraisal, or the most recent Bank appraisal, if available.

Loans 30 to 89 · Loans 90 or More Days Delinquent
One- to Four-Family · Days Delinquent · or in Foreclosure
StateAmount% of TotalAmount% of TotalAmount% of TotalLTV
(Dollars in thousands)
Kansas$3,182,98156.8%$6,12966.1%$3,84650.1%51%
Missouri955,64917.11,68918.21,01313.266
Other states1,463,62626.11,45415.72,81536.750
$5,602,256100.0%$9,272100.0%$7,674100.0%53

The following table presents the unpaid principal balance of commercial real estate loans, aggregated by state, that were 30 to 89 days delinquent or 90 or more days delinquent or in foreclosure, and the weighted average LTV and weighted average DSCR for loans 90 or more days delinquent or in foreclosure at June 30, 2026. See additional discussion regarding the Bank's commercial real estate loan DSCRs and LTVs in the "Management's Discussion and Analysis of Financial Condition and Results of Operation - Loans Receivable - Commercial Loans" section above.

Loans 30 to 89 · Loans 90 or More Days Delinquent
Days Delinquent · or in Foreclosure
StateAmount% of TotalAmount% of TotalLTVDSCR
(Dollars in thousands)
Kansas$2,040100.0%$2,821100.0%48%1.74x
Other states——————
$2,040100.0%$2,821100.0%481.74

Classified Loans. The following table presents the amortized cost of loans classified as special mention or substandard at the dates presented. The decrease in commercial real estate special mention loans at June 30, 2026 compared to September 30, 2025 was due mainly to a hotel participation loan being upgraded to a "pass" classification as a result of an improvement in the hotel's financial results. The majority of the substandard commercial real estate loan balance for the periods presented in the table below relates to one borrowing relationship. During the March 31, 2026 quarter, an updated appraisal was received related to the collateral securing the lending relationship. The updated appraisal was lower than the appraisal received in the prior year and as a result, a $4.0 million specific valuation allowance was recorded as of March 31, 2026 related to this lending relationship which was still in place at June 30, 2026. The loans associated with this lending relationship were on nonaccrual at all dates presented in the table below.

June 30, 2026March 31, 2026September 30, 2025
Special MentionSubstandardSpecial MentionSubstandardSpecial MentionSubstandard
(Dollars in thousands)
One- to four-family$11,839$22,620$12,498$24,023$13,055$20,616
Commercial:
Commercial real estate15,62644,79822,35245,77359,99345,550
Commercial and industrial1126483641,414399473
Consumer142356166213326322
$27,719$68,422$35,380$71,423$73,773$66,961

Allowance for Credit Losses. The Bank utilizes a discounted cash flow model for estimating expected credit losses for pooled loans and loan commitments. Expected credit losses are determined by calculating projected future loss rates, which are dependent upon forecasted economic indices, and applying qualitative factors when deemed appropriate by management. At June 30, 2026, management applied qualitative factors to account for large dollar commercial real estate loan concentrations and potential risk of loss in market value for newer one- to four-family loans. These qualitative factors were applied to account for credit risks not fully reflected in the discounted cash flow model.

See "Part II, Item 8. Financial Statements and Supplementary Data - Notes to Consolidated Financial Statements - Note 1. Summary of Significant Accounting Policies" in the Company's Annual Report on Form 10-K for the fiscal year ended September 30, 2025 and "Part I, Item 1. Note 4. Loans Receivable and Allowance for Credit Losses" within this Quarterly Report on Form 10-Q for additional information related to the key assumptions used in the discounted cash flow model and the qualitative factors.

The distribution of our ACL and the ratio of ACL to loans receivable, by loan type, at the dates indicated is summarized below. The decrease in the ACL to loans receivable ratio as of June 30, 2026 compared to March 31, 2026, was due primarily to an update to the ACL model's regression analyses. The update entailed incorporating additional historical loss time periods for all loan categories within the ACL model and resulted in a decrease in the ACL of approximately $800 thousand, mainly within the commercial construction loan category. The historical loss experience for commercial construction loans continued to show lower historical losses resulting in a lower loss rate for this loan category. The increase in the ACL to loans receivable ratio as of June 30, 2026 compared to September 30, 2025, was due primarily to establishing a $4.0 million specific valuation related to a commercial real estate lending relationship during the March 31, 2026 quarter which continued to be in place at June 30, 2026, partially offset by improvement between periods in some of the commercial-related forecasted economic indices and an update to the ACL model's regression analyses (as discussed above). Based on management's evaluation of the credit risk within the Bank's commercial loan portfolio, taking into consideration DSCRs and LTVs, management believes the Bank's ACL ratio for commercial loans is appropriate for the credit risk. See additional discussion regarding the Bank's commercial real estate loan DSCRs and LTVs in the "Financial Condition - Loans Receivable - Commercial Loans" section above.

Distribution of ACLRatio of ACL to Loans Receivable
June 30,March 31,September 30,June 30,March 31,September 30,
202620262025202620262025
(Dollars in thousands)
One- to four-family:
Originated$1,299$1,587$1,7300.04%0.04%0.05%
Purchased9141,0581,2980.050.050.06
Construction1118180.100.110.11
One- to four-family2,2242,6633,0460.040.050.05
Commercial:
Commercial real estate18,70118,97315,8090.931.000.92
Commercial and industrial2,8102,0462,4991.030.881.19
Commercial construction2,1852,7162,4681.131.441.26
Total23,69623,73520,7760.961.020.98
Consumer1832012170.160.180.19
Total$26,103$26,599$24,0390.320.330.30

Historically, the Bank has maintained very low delinquency ratios and NCO rates. Over the past two years, the Bank's highest ratio of commercial loans 90 days or more delinquent to total commercial loans at a quarter end was 0.22%. The highest such ratio for one- to four-family originated and correspondent loans, combined, was 0.17%. During the 10-year period ended June 30, 2026, the Bank recognized total NCOs of $1.2 million. As of June 30, 2026, the ACL balance was $26.1 million and the reserve for off-balance sheet credit exposures totaled $6.2 million, which management believes is adequate for the credit risk characteristics in our loan portfolio.

The following table presents ACL activity and related ratios at the dates and for the periods indicated.

At or For the Nine Months Ended
June 30, 2026June 30, 2025
(Dollars in thousands)
Balance at beginning of period$24,039$23,035
Charge-offs(314)(169)
Recoveries1037
Net (charge-offs) recoveries(304)(132)
Provision for credit losses2,368(95)
Balance at end of period$26,103$22,808
Ratio of NCOs during the period
to average non-performing assets0.61%0.45%
ACL to nonaccrual loans at end of period50.9047.07
ACL to loans receivable, net at end of period0.320.28
ACL at end of period to NCOs
during the period (annualized)65x129x

The ratio of NCOs during the period to average non-performing assets was higher in the current year period compared to the prior year period due to an increase in NCOs during the current year period. The ratio of ACL to nonaccrual loans was higher at the end of the current year period compared to the prior year period due to a higher ACL balance at June 30, 2026. The increase in the ratio of the ACL to total loans as of June 30, 2026 from June 30, 2025 was due primarily to an increase in the commercial loan portfolio which has a higher ACL to loans receivable ratio than one- to four-family loans and establishing a $4.0 million specific valuation related to a commercial real estate lending relationship during the current year period, partially offset by improvement between periods in some of the commercial-related forecasted economic indices and an update to the ACL model's regression analyses. ACL at the end of the period to NCOs during the current year period (annualized) was lower compared to the prior year period due primarily to higher NCOs in the current year period. Additional information related to ACL activity by specific loan categories for the current year period can be found in "Part I, Item 1. Financial Statements and Supplementary Data - Notes to Consolidated Financial Statements - Note 4. Loans Receivable and Allowance for Credit Losses" within this Quarterly Report on Form 10-Q.

The following table presents NCOs, average loans, and NCOs as a percentage of average loans, by loan type, for the periods indicated.

For the Nine Months Ended
June 30, 2026June 30, 2025
NCOsAverage Loans% of Average LoansNCOsAverage Loans% of Average Loans
(Dollars in thousands)
One- to four-family:
Originated$10$3,687,336—%$(7)$3,863,012—%
Purchased—2,059,731—1132,286,491—
Construction—13,763——18,126—
Total105,760,830—1066,167,629—
Commercial:
Commercial real estate501,869,222—(20)1,379,009—
Commercial and industrial173232,8440.07(3)135,511—
Commercial construction—188,627——174,518—
Total2232,290,6930.01(23)1,689,038—
Consumer:
Home equity53107,5580.0545101,1780.04
Other187,6900.2349,3560.04
Total71115,2480.0649110,5340.04
$304$8,166,771—$132$7,967,201—

While management utilizes its best judgment and information available, the adequacy of the ACL and reserve for off-balance sheet credit exposures is determined by certain factors outside of the Company's control, such as the performance of our loan portfolio, changes in the economic environment, including economic uncertainty, changes in interest rates, and the view of regulatory authorities toward classification of assets and the level of ACL and reserve for off-balance sheet credit exposures. Additionally, the level of ACL and reserve for off-balance sheet credit exposures may fluctuate based on the balance and mix of the loan portfolio and off-balance sheet credit exposures. If actual results differ significantly from our assumptions, our ACL and reserve for off-balance sheet credit exposures may not be sufficient to cover inherent losses in our loan portfolio, resulting in additions to our ACL and an increase in the provision for credit losses.

Securities. The following table presents the distribution of our securities portfolio, at amortized cost, at the dates indicated. The majority of our securities are government guaranteed or issued by GSEs. Overall, fixed-rate securities comprised 91% of our securities portfolio at June 30, 2026. The WAL is the estimated remaining maturity (in years) after three-month historical prepayment speeds and projected call option assumptions have been applied. During the current fiscal year, the Bank reinvested cash flows from the securities portfolio into commercial loan growth and to pay down maturing FHLB borrowings.

June 30, 2026March 31, 2026September 30, 2025
AmountYieldWALAmountYieldWALAmountYieldWAL
(Dollars in thousands)
MBS$770,7575.42%3.4$791,6595.44%4.0$843,3695.45%4.8
Corporate bonds4,0005.125.94,0005.126.14,0005.126.6
$774,7575.423.4$795,6595.444.0$847,3695.454.8

The following table summarizes the activity in our securities portfolio based on the estimated fair value, which is also the carrying value, for the periods presented. The weighted average yields for the beginning and ending balances are as of the first and last days of the periods presented and are generally derived from recent prepayment activity on the securities in the portfolio. The beginning and ending WALs are the estimated remaining principal repayment terms (in years) after three-month historical prepayment speeds and projected call option assumptions have been applied.

For the Nine Months Ended
June 30, 2026 · June 30, 2025
Amount · Yield · WAL · Amount · Yield · WAL
(Dollars in thousands)
Beginning balance - carrying value$867,2165.45%4.8$856,2665.63%5.2
Maturities and repayments(113,127)(147,190)
Net amortization of (premiums)/discounts2,7292,491
Purchases37,7864.226.5248,2074.977.5
Change in valuation on AFS securities(11,045)(3,545)
Ending balance - carrying value$783,5595.423.4$956,2295.474.6
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