Pathward Financial, Inc. · NASDAQ:CASH
Pathward Financial — Meta Financial Group — Q1 2018 Earnings Presentation
20 slides from Pathward Financial's earnings presentation, Jan 30, 2018
Slide 1: Investor Update First Quarter Fiscal Year 2018
Investor Update First Quarter Fiscal Year 2018 y Meta @
Slide 2: Forward-Looking Statements
Forward-Looking Statements Meta Financial Group, Inc." (the “Company” or "Meta MetaBank’ (the “Bank” 1 : i C SEC") 1 in oth may," “hope,” I," “expect,” “plan,” “anticipate,” “intend,” “believe,” “estimate, “could,” “future information, ‘pect timates, and intentions, which are subject fl ied by, 3tma
Slide 3: Crestmark Transaction Overview
Crestmark Transaction Overview Merger of Crestmark Bancorp, Inc. with and into Meta Financial Group, Ine., and Crestmark Bank with and Transaction ino Mose {exchange each outstanding share of Crestmark for 2.65 shares of Meta common stock (approximately 3.3 million shares to be issued) Consideration
Slide 4: Crestmark Transaction Highlights
Crestmark Transaction Highlights Superb Strategic Fit Financially Compelling Risk Mitigation Facto! Combines two highly-profitable and high-growth earnings-driven cultures + Combines Meta’s noninterest bearing deposit platform with Crestmark's strong. bibsaine cul nee and nationwide loan generati En
Slide 5: Company Overview
Company Overview Prepaid low-cost deposit base provides Prepaid division generates fee income with competitive advantage to obtain high-quality low-cost, long duration deposit base FS credits and attractive terms for the Community ank and National Lending programs LEVERAGE DEPOSITS BROUGHT IN FROM O
Slide 6: The Meta Ecosystem
The Meta Ecosystem Banking Payments Community Banking Prepaid/ATM/Other Regional cormuriys fare with 10 branch locations prepaid card industry leader with payments in lowa and Sout diversion Gouin, chile ‘operations: a to grow “annuityike” stream of fee income Loan growth of 19-30% YoY each quarter
Slide 7: Tax Season Update
Tax Season Update Tax product fee income was $2.1 million in first fiscal quarter of 2018, an increase of $1.5 million, or 242% compared to the same period last year Increase primarily due to the increase in volume of pre-season tax advance loans originated during the first quarter of fiscal 2018 co
Slide 8: Financial Highlights
Financial Highlights First Quarter Ended December 31, 2017 Earnings Quarterly GAAP net income of $4.7 million“, or $0.48 per diluted share Return on average assets of 0.45% and return on average equity of 4.30% Net interest income ("NII") Quarterly Nil of $26.2 million, an increase of 32% over the s
Slide 9: Loan Portfolio
Loan Portfolio (sum) rst Quarter Highlights Total loans receivable, net of allowance for loan losses ("ALL"), Y/Y Loan Receivable Composition increased 36%, Y, ‘commercial insurance premium finance, and residential mortgage toons” \sumer pl of in October 2017 and pre-season tax advance loans Jan por
Slide 10: Net Interest Margin (NIM)
Net Interest Margin ("NIM")(®) (smm) | . ; First Quarter Highlights Net interest income, loan yield and NIM Net interest income increased 32% and NIM increased 16 basis points, compared to fiscal first quarter 2017 $26.2 2 sb n fenets oe seiats poeta et rate onthe Company's tax exempt municipal port
Slide 11: Earning Asset Mix
Earning Asset Mix (sum) Interest Earning Assets Qat7 247 Qst7 Fiscal Quarter Average quar Ld a Loans [Cash and other Securities Continue to improve earning asset mix + Asset diversification with higher yields Earning Asset Growth © Growing toan portal represented 37% of earning assets at fiscal firs
Slide 12: Balance Sheet Overview
Balance Sheet Overview (sum Total Average Assets Total Average Liabilities sana ‘i $ $4,123 Hy 54,000 $4,034 + 2 ° + S é s3.aod 3 * & naz e247 esa? war 13s Fiscal Quarter Average r] ] TH Ymotesale deposits HE borowings TE Subosdinated debt Bother tiaoittios st Quarter Highlights Average assets for f
Slide 13: Regulatory Capital
Regulatory Capital Regulatory Capital Ratios(®) 16.99% 17.2% 16.71% 16.71% see 13.38% Minimum Requirement >be WelkCaptaized under 61% Prompt Corrective Action 768% (PCA) Provisions Tier 1 Leverage Common Equity Tier 1 Tier 4 RiskBased Total Risk Based Meta Financial Group, Inc. M_ MetaBank Goal: mai
Slide 14: Competitive Landscape
Competitive Landscape Early adopter of sophisticated compliance systems Investments in 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 oppo
Slide 15: Interest Rate Risk Management
Interest Rate Risk Management Interest rate itivity (what believes) Static interest rate risk results do not accurately reflect the Company's true interest rate sensitivity due to the Company's unique and historically predictable deposit base Utilizing quarterly average balances for deposits, cash a
Slide 16: Industry Recognition
Industry Recognition FORTUNE Avanican Boner Named one of Fortune magazine's 100 Fastest-Growing Companies (September 2017) Top 40 of ACH originators in 2016 (April 2017) Top 30 of ACH receivers in 2016 (April 2017) Metabani named one of “7 To Watch One of the top performing mid-size banks in 2016 (J
Slide 17: Appendix
Appendix
Slide 18: Income Statement
Income Statement Net Interest Income Card Fee Income RT Product Fee Income ‘Tax Advance Fee Income Other Income Total Revenue ‘Compensation and Benefits Card Processing Expense RT Product Expense Tax Advance Expense All Other Expense Total Expense Provision for Loan Loss Net Income Before Taxes. Inc
Slide 19: Average Balance Sheet
Average Balance Sheet ‘Cash and cash equivalents Investment securities Mortgage-backed securities Net loans Other assets Total Assets Non terest bearing deposits Imerest bearing deposits Wholesale deposits Shortterm debt Longterm debt Other labiities Total Liabilities Shareholder’ eauity Liabilities
Slide 20: Additional Information About the Proposed Transaction and Where to Find It
Additional Information About the Proposed Transaction and Where to Find It In connection with the proposed merger transaction, Meta intends to file a registration statement on Form $-4 with the SEC, which will include a Joint proxy statement of Meta and Crestmark, which will also constitute a prospe