Pathward Financial, Inc. · NASDAQ:CASH
Pathward Financial — Meta Financial Group — Q4 FY2017 Earnings Presentation
19 slides from Pathward Financial's earnings presentation, Oct 30, 2017
Slide 1: Investor Update: Fourth Quarter and Fiscal Year End 2017
Investor Update Fourth Quarter and Fiscal Year End 2017 Meta®
Slide 2: Forward Looking Statements
Forward Looking Statements “Company” staBank’ (the “Bank"), may “forward-looking statements,” bees gt i in ot provisions of the Private Securities Litigation Reform Act of 1995. “should,” “expect,” “plan,” “anticipate,” “intend,” “believe,” “estimate,” “predict,” “may,” “hops “potential,” “continue,
Slide 3: 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 (ES credits and attractive terms for the Retail Bank ‘and Specialty Finance divisions LEVERAGE DEPOSITS BROUGHT IN FROM
Slide 4: The Meta Ecosystem
The Meta Ecosystem Banking Payments Retail Banking Prepaid/ATM/Other Regional community Be with 10 branch locations A prepaid cor industry leader with payments, in lowa and South Dakote diversification Growing, profitable operations Continuing to seer “annuitysike” stream of fee + Loan growth a 19-3
Slide 5: Financial Highlights
Financial Highlights Record breaking fiscal year earnings Fiscal year 2017 (FY 2017) GAAP net income of $44.9 million, an increase of 35% over fiscal year 2016+ Quarterly GAAP net income of $1.7 million? Quarterly and FY 2017 diluted earnings per share of $0.19 and $4.83, respectively 2017 return on
Slide 6: Income Growth
Income Growth (smu Non-interest income grew 71% in FY 2017 compared to FY 2016 + Card fee income continues to accelerate year over year, adding $95 million to nor-interest income in FY 2017 $1722 Growth was driven y synergies with our tax business wth in our core payments business, and ceca care ees
Slide 7: Net Interest Margin
Net Interest Margin (smm Net Interest Income and NIM Fourth Quarter Highlights $24.94 Net interest income increased 23%, compared to Q4 Fy 2016 Issuance of subordinated debt in Q4 FY 2016 (12 bps) Continued to employ balance sheet leverage strategy to utilize the excess capital the Co mpany continue
Slide 8: Net Interest Income and Yields
Net Inter Fiscal Quarter Average Total Loans and Yield Total Investments and Yield $2,383 $2,358 : 4.56% sas qua? a7 37 417 gaas qua7 oar 347 qaa7 Excluding refund advance loans, total loan yield for Q4 FY 2017 was 4.55% ned to increase with rising rate Interest Bearing Liabilities and Total Cost of
Slide 9: Earning Asset Mix
Earning Asset Mix (sum) Interest Earning Asset Mix Fiscal Quarter Average Lt i | Loans TH Cash and other Seourties Continue to improve earning asset mix + Asset diversification with higher yields Earning Asset Growth + Increased balances of high-quality specialty Q4 2016 to Q4 2017 finance and retai
Slide 10: Loan Portfolio
Loan Portfolio (sum) Loans Receivable Composition Total loans receivable increased 43%, YoY Primarily driven by increases in Consumer, Commercial Real Estate, Premium Finance, and Residential Mortgage loans Consumer loan growth puta driven by purchase of student loan portfolio in December 201 Exclud
Slide 11: Loan Portfolio/Credit Quality
Loan Portfolio/Credit Quality ‘fourth Quarter Highlight: \dvance loans from the Allowance for loan losses (ALL) was $7.5 million, or 0.6% of total loans, at September 30, 2017 + Recovery of $0.1 million was recorded es the fourth quarter primarily due to continued collections and recoveries on tax a
Slide 12: Balance Sheet Overview
Balance Sheet Overview (sum Total Average Assets Total Average Liabilities anna y e $4,034 3 $4,000 Ds 2 s3.49u é . a $3,235 Hy cs sts qua7 gear gsr gear Fiscal Quarter Average 1] a TE Wrotesae deposits HE eoronings Subordinated debt Fourth Quarter Highlights Average assets for Q4 FY 2017 grew 25% c
Slide 13: Regulatory Capital
Regulatory Capital Regulatory Capital Ratios* 18.22% 18.22% inimum Requirement be WelkCaptaized under Prompt Corrective Action (PCA) Provisions Total Risk Based Tier 4 Leverage Common Equity Tier 1 Tier 4 RiskBased Regulatory ratios ae estimated Period Ending Meta Financial Group, Inc. | MetaBank Go
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 developmen
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 our unique and historically predictable deposit base Utilizing quarterly average balances for deposits, cash and borrowi
Slide 16: Industry Recognition
Industry Recognition FORTUNE AMeRicavBawKer §Bank Director #1 Top Growth Bank (May 2016) Named Top Community Bank (August 2016) Named one of Fortune magazine's 4.00 Fastest-Growing Companies (September 2017) "REPORT One of the top performing mid-size banks in 2016 (June 2017) Top 40 of ACH originato
Slide 17: Appendix
Appendix Meta®
Slide 18: Income Statement
Income Statement ‘Three Months Ended Fiscal Year Ended Change RE Net interest Income 19,893 19,833 93,230 21% Card Fee Income 47,920 18,414 94,707 34% RT Product Fee Income 285 176 38,956 67% ‘Tax Advance Fee Income - 44931119 453 NA 31,913 1.926% ‘ther income 4,023 310 2.017 2,178 113% 5315 6,596 2
Slide 19: Average Balance Sheet
Average Balance Sheet Fiscal Quarter Average Fiscal Year Average FY A sept 17 _ Sept 2016 2017 Cash and cash equivalents: 50,976 195,004 404,688 85,158 52,421 182,927 249 % Investment securties, 1,374,288 1,394,596 1,593,130 ‘ 1,595,587 16% 1,238,284 1,549,043 25% Mortgage-backed securities 701,312
Meta Financial Group — Q4 FY2017 Earnings Presentation on 6ix