Pathward Financial, Inc. · NASDAQ:CASH
Pathward Financial — Meta Financial Group — Q2 FY2019 Earnings Presentation
18 slides from Pathward Financial's earnings presentation, April 2019
Slide 1: Quarterly Investor Update Second Quarter Fiscal Year 2019
Quarterly Investor Update Second Quarter Fiscal Year 2019
Slide 2: Forward-Looking Statements
Forward-Looking Statements Meta Financial Group, Inc.® (the “Company” or "Meta") 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 Se
Slide 3: Overview
Overview Second Quarter Ended March 31, 2019 Delivered strong second quarter earnings. • Earnings per diluted share was $0.81 for the quarter. • Significant items this quarter included: – $6.1 million, pre-tax, executive transition agreement expense, $0.12 per share after-tax – $6.6 million, after-t
Slide 4: Differentiated Approach to Driving Shareholder Value
Differentiated Approach to Driving Shareholder Value 1 2 3 KEY Increase Percentage of Optimize Earning Asset Improve Operating Funding from Core INITIATIVES Deposits Mix Efficiencies Leverage payments division growth Replace lower yielding loans and opportunities securities with higher yielding loan
Slide 5: Tax Season Update
Tax Season Update 2019 Tax Season shows growth amid Government shutdown • Refund advance originations of $1.49 billion, up 18%, compared to the 2018 tax season – Higher originations driven by increased average loan sizes. – Approximate average loan size of $1,400 compared to $1,100 in 2018. • Launch
Slide 6: Differentiated Approach Creates Long-term Value
Differentiated Approach Creates Long-term Value Aspirational Target Qualitative Metrics • ROA > 2.0% • Efficiency ratio < 65% Long-Term Capital Management Options • Share repurchases – Authorized share repurchase program, up to 2,000,000 shares of outstanding common stock, effective May 1, 2019 - Se
Slide 7: Financial Highlights
Financial Highlights 7 Second Quarter Fiscal Year 2019 | Nasdaq: CASH
Slide 8: Financial Highlights
Financial Highlights Second Quarter Ended March 31, 2019 • Net income of $32.1 million, or $0.81 per diluted share, for the quarter. • Net interest margin increased to 5.06% from 4.60% for the fiscal 2019 first quarter. Net interest margin, tax- equivalent(1), increased to 5.18% from 4.76% over that
Slide 9: Financial Highlights
Financial Highlights Second Quarter Ended March 31, 2019 Aspirational Selected Quarterly Average Earning Asset Mix(1) March 2018 March 2019 Earning Asset Mix Commercial Finance 6% 29% >55% Consumer & Warehouse Finance 5% 9% <15% Community Bank 23% 21% <15% Investments 53% 30% <20% (1) Quarterly aver
Slide 10: Scalable and Diversified Loan Portfolio $3.4 billion
Scalable and Diversified Loan Portfolio National Commercial Lending Platforms Add Further Diversification All amounts presented are as of March 31, 2019 National Commercial Finance Community Banking Tax Services Commercial finance portfolio National Community banking portfolio 2.5% Consumer increase
Slide 11: Asset Quality Remains Strong and Stable
Asset Quality Remains Strong and Stable Disciplined Credit Culture Continues to Drive Strong Asset Quality $0.1 • Allowance for loan and lease losses was $48.7 million at March 31, 2019, compared to $27.1 million at March 31, 2018 – Primarily driven by increases in allowance related to the commercia
Slide 12: Regulatory Capital as of March 31, 2019
Regulatory Capital as of March 31, 2019 Strong capital remains above "well-capitalized" Management targets six-month average Bank capital ratios to reduce seasonality(1) MetaBank Six-Month Average Actual Target Tier 1 Leverage 8.97% >8.0% Total Risk-Based Capital 13.42% >12.0% Authorized share repur
Slide 13: Investment Highlights
Investment Highlights Differentiated Model • Targeted niche commercial and consumer industries provide opportunities for growth Low-Cost Funding Advantage • National payments business drives low-cost deposits • Re-focused on increasing percentage of funding from core deposits Scalable Lending Platfo
Slide 14: Appendix
Appendix 14 Second Quarter Fiscal Year 2019 | Nasdaq: CASH
Slide 15: Quarterly Income Statement
Quarterly Income Statement 2Q19 Change From ($ in millions, except per share data) 2Q18 1Q19 2Q19 1Q19 2Q18 $ % $ % Net Interest Income 27.4 60.3 71.4 11.1 18% 43.9 160% Card & Deposit Fee Income 27.8 21.3 25.1 3.9 18% (2.7) (10)% Refund Transfer Product Fee Income 33.8 0.3 31.6 31.3 NM (2.2) (7)% T
Slide 16: Average Balance Sheet
Average Balance Sheet Fiscal Quarter Average - Quarter Ended March 31, 2018 June 30, 2018 Sept. 30, 2018 Dec. 31, 2018 March 31, 2019 2Q19 Change From ($ in millions) 2Q18 3Q18 4Q18 1Q19 2Q19 1Q19 2Q18 $ % $ % Cash and fed funds sold 132 57 61 45 281 236 519% 149 112% Total Investments 2,263 2,254 2
Slide 17: Tax Services Products
Tax Services Products Offer a wide range of tax products, including: Electronic Return Originator ("ERO") Advances Short-term, small business loan typically utilized by independent tax preparers to purchase tax preparation software and to prepare tax office operations for the upcoming tax season. Ge
Slide 18: Experienced Management Team
Experienced Management Team Industry MetaBank Experience Experience Executive Officers Prior Experience (years) (years) Brad Hanson • President at MetaBank President and Chief Executive Officer • Prior experience in financial services, including numerous banking, payment card 29 15 industry and tech
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