Pathward Financial, Inc. · NASDAQ:CASH
Pathward Financial — Meta Financial Group — Q4 FY2016 Earnings Presentation
18 slides from Pathward Financial's earnings presentation, April 2016
Slide 1: Investor Update: Fourth Quarter Fiscal Year 2016
Investor Update Fourth Quarter Fiscal Year 2016 April 2016
Slide 2: Forward Looking Statements
Forward Looking Statements Meta Financial Group, Inc.® (the “Company”) and its wholly-owned subsidiary, MetaBank® (the “Bank”), may from time to time make written or oral “forward-looking statements,” including statements contained in this Investor Update, the Company’s filings with the Securities a
Slide 3: Meta's Value Proposition & Growth Drivers
Meta’s Value Proposition & Growth Drivers • Significant growth; current partner relationships expanding, new partners added, and new products implemented with more to come in 2017 and beyond Leverage Payments • MPS 25% average deposit growth in FY16 • Expanded tax payments presence via Refund Advant
Slide 4: Who We Are
Who We Are Meta Financial Group, Inc. (MFG) is the holding company for MetaBank®, a federally chartered savings bank. Headquartered in Sioux Falls, SD, MetaBank operates in both the Banking and Payments industries through: MetaBank, its traditional retail banking operation; Meta Payment Systems, the
Slide 5: Who We Are
Who We Are Retail Bank Meta Payments Systems 60+ 29% • Regional Community Bank, 10 branch locations in Iowa • Prepaid card industry leader with payments diversification and South Dakota • Continuing to grow “annuity”-like stream of fee income Years in Business • Growing, profitable operations • New
Slide 6: Meta Executive Management
Meta Executive Management J. Tyler Haahr, Chairman and Chief Executive Officer Tyler joined Meta in 1997. Previously, he was a partner with the law firm of Lewis and Roca LLP in Phoenix, AZ. He serves as the Secretary and as a member of the Board of Directors of LifeScape. Tyler serves as a director
Slide 7: Revenue Highlights
Revenue Highlights Net Income ($MM) Net Income • Year-over-year growth of 84% from prior fiscal year $6.0 Q1 Q2 Q3 Q4 • 4QFY16 net income totaled $6.0MM versus $4.6MM in 4QFY15 $8.9 Earnings Profile • Sizable and rapidly growing non-interest income $4.6 $3.4 $3.5 $14.3 • Opportunity for net interest
Slide 8: Earning Asset Mix & Net Interest Margin
Earning Asset Mix & Net Interest Margin 2.85% 3.09% 3.09% 24bps NIM Expansion since 2.49% 9/30/2014 2.22% 4Q14 Net Interest Margin Qtr Avg 10 Year Treasury 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 1.56% 4Q16 93bps 10-Year Treasury Yield Declined since 9/30/2014 (Qtr Average) 147% FY12 Earning Asset Mix* F
Slide 9: Balance Sheet Overview – Assets
Balance Sheet Overview – Assets Fiscal year 2016 average assets grew 30% compared to fiscal Total Assets ($MM) At September 30 year 2015 • 4Q16 average assets grew 32% over the same quarter in 2015 30% YoY total loan growth driven by increases in Residential 24.8% Asset Compound Annual Growth Rate (
Slide 10: Asset Quality
Asset Quality Very strong asset quality • NPAs are at 0.03% of total assets, a small fraction of bank industry average¹ No NPAs within the Payments segment Continue to purchase high-quality investments within certain sectors of the municipal market • Many of these new purchases are tax exempt and al
Slide 11: Balance Sheet Overview - Liabilities
Balance Sheet Overview - Liabilities Deposits* ($MM) 0.60% $2,400 Historical Low Cost of Funds 0.26% 0.50% Average Cost of Funds in 4Q16 $2,000 • Issuance of $75MM of Subordinated Debt was the 0.40% driver for the increase in cost of funds over 4QFY15 $1,600 MFG Cost of Funds at MFG, however, MetaBa
Slide 12: Capital Management
Capital Management Capital enhancement history Regulatory Capital Ratios At September 30, 2016¹ • $26.1 million and $11.7 million private placements Meta Financial supporting Refund Advantage acquisition and other Group, Inc. 23.17% 22.35% 21.95% 21.95% growth in 2015-16 MetaBank 17.28% 17.82% • 201
Slide 13: Infrastructure
Infrastructure Early adopter of sophisticated compliance systems Investments in MPS program design, training and technology • Implemented enhanced BSA/AML technology • Enhanced infrastructure supports growth • These prior investments allow more focus on growing current business and new development o
Slide 14: Interest Rate Risk Management
Interest Rate Risk Management Positively leveraged for higher rate environment Interest rate sensitivity (what management believes) Other Comprehensive Income volatile relative to peers Static interest rate risk results do not accurately reflect • We believe GAAP understates balance sheet true value
Slide 15: Industry Recognition
Industry Recognition #1 Top Growth Bank (May 2016) Second largest prepaid card issuer in the U.S. ranked by Top 50 of ACH originators in 2015 purchase volume (2015) Top 30 of ACH receivers in 2015 #44 “More double-digit goodness” (June 2015) based on average ROE over the past three years #48 “Top 20
Slide 16: Appendix
Appendix Fourth Quarter 2016 | NASDAQ: CASH 16
Slide 17: Income Statement
Income Statement Fiscal Year Ended September 30, Three Months Ended September 30, Meta Financial Group 2013 2014 2015 2016 2015 2016 % Change ($000’s) Net Interest Income 36,022 46,262 59,220 77,305 15,703 19,893 26.7% Non-Interest Income 55,503 51,738 58,174 100,770 15,106 19,228 27.3% Total Revenu
Slide 18: Balance Sheet
Balance Sheet Fiscal Year Average Fiscal Quarter Average Meta Financial Group 2013 2014 2015 2016 4Q15 4Q16 % Change ($MM) Cash And Cash Equivalents 77 93 120 52 81 51 -37.0% Investments and MBS 1,214 1,291 1,471 1,966 1,534 2,076 35.3% Loans Receivable, Net 337 435 612 804 684 900 31.6% Other Asset
Meta Financial Group — Q4 FY2016 Earnings Presentation on 6ix