Pathward Financial, Inc. · NASDAQ:CASH
Pathward Financial — Meta Financial Group — Q2 2022 Earnings Presentation
18 slides from Pathward Financial's earnings presentation, Apr 28, 2022
Slide 1: Quarterly Investor Update Second Quarter Fiscal Year 2022
QUARTERLY INVESTOR UPDATE SECOND QUARTER FISCAL YEAR 2022
Slide 2: Forward Looking Statements
FORWARD LOOKING STATEMENTS 2 This investor update contains “forward-looking statements” which are made in good faith by the Company pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. You can identify forward-looking statements by words such as “may,” “h
Slide 3: We strive to increase financial availability, choice, and opportunity
3 WE STRIVE TO INCREASE FINANCIAL AVAILABILITY, CHOICE, AND OPPORTUNITY THROUGH FINANCIAL EMPOWERMENT. We work to disrupt traditional banking norms by developing partnerships with fintechs, affinity groups, government agencies, and other banks to make a range of quality financial products and servic
Slide 4: Second Quarter Business Highlights
Optimize Interest-Earning Assets Optimize Deposits Optimize Operating Efficiencies Efficiency ratio of 59.83% compared to 63.10% as of March 31, 2021.1 • Drive long-term simplification and optimization of existing business platforms. • Investing in technology to help drive efficiencies and operating
Slide 5: Other Business Developments
OTHER BUSINESS DEVELOPMENTS SECOND QUARTER ENDED MARCH 31, 2022 5Meta Financial Group, Inc. (Nasdaq: CASH) | Quarterly Investor Presentation • On March 29, 2022, the Company announced it is changing its name to Pathward Financial, Inc.TM, and its bank subsidiary, MetaBank, N.A., will be changing its
Slide 6: Summary Financial Results
SUMMARY FINANCIAL RESULTS SECOND QUARTER ENDED MARCH 31, 2022 6 1 Amounts presented are used in the two-class earnings per common share calculation. INCOME STATEMENT ($ in thousands, except per share data) 2Q21 1Q22 2Q22 Net interest income 73,850 71,613 83,800 Provision for credit losses 30,290 186
Slide 7: 2022 Tax Season Update
2022 TAX SEASON UPDATE 7 Refund advances (“RAs”) and refund-transfers (“RTs”) leverage banking-as-a-service (“BaaS”) infrastructure and are core to MetaBank’s mission, as they allow consumers quicker access to their money. • RA originations of $1.83 billion compared to $1.79 billion in the 2021 tax
Slide 8: BaaS Capabilities Generate Increasing Low-Cost Deposits and Revenue
$- $20.0 $40.0 $60.0 $80.0 $100.0 $120.0 2Q21 1Q22 2Q22 Payments Tax Services Consumer Lending BaaS CAPABILITIES GENERATE INCREASING LOW-COST DEPOSITS AND REVENUE 8 Growth in BaaS revenue Average Payments Deposits* ($ in billions) 59% 22% 58% % of Total Revenue % of Payments Revenue ($ in millions)
Slide 9: Balance Sheet Highlights
BALANCE SHEET HIGHLIGHTS SECOND QUARTER ENDED MARCH 31, 2022 9 BALANCE SHEET PERIOD ENDING ($ in thousands) 2Q21 1Q22 2Q22 Cash and cash equivalents 3,724,242 1,230,100 237,680 Investments 1,552,892 1,833,733 2,090,765 Loans held for sale 67,635 36,182 31,410 Loans and leases (HFI)1 3,657,531 3,684,
Slide 10: Quarterly Average Earning Asset Mix
Quarterly Average Earning Asset Mix % in charts represent % of total interest earning assetsAt the Quarter Ended MAR 31, 2021 MAR 31, 2022 ($ in thousands) 2 Q 2 1 2 Q 2 2 Y/Y Δ COMMERCIAL FINANCE 2,505,922 2,914,829 16% Term lending 891,414 1,111,076 25% Asset-based lending 248,735 382,355 54% Fact
Slide 11: Overview of Loan Portfolio
OVERVIEW OF LOAN PORTFOLIO 11 ($ in millions) Business Line Balance Sheet Category 2Q21 1Q22 2Q22 MRQ Yield Commercial Finance Commercial Finance Guaranteed portion of US govt SBA/USDA loans SBA/USDA 68.5 44.6 61.7 Unguaranteed portion of US govt SBA/USDA loans SBA/USDA 54.8 101.1 109.5 Paycheck pro
Slide 12: Key Credit Metrics
$3.8 $2.8 $7.0 $3.4 $11.4 0.44% 0.32% 0.77% 0.37% 1.25% 2Q21 3Q21 4Q21 1Q22 2Q22 Period Ended Adj. NCOs Adj. NCOs / Adj. Average Loans Adjusted Net Charge-Offs (“NCOs”)¹ Excludes Tax Services NCOs and Related Seasonal Average Loans ($ in millions) KEY CREDIT METRICS • Annualized adjusted net charge-
Slide 13: Interest Rate Risk Management
-10% 5% 20% 35% -100 +100 +200 +300 Parallel Shock Ramp 1 Fixed rate securities, loans and leases are shown for contractual periods. -2,000 0 2,000 4,000 Month 1-12 Month 13-36 Month 37-60 Month 61-180 V o lu m e ( $ M M ) Period Variance Total Assets Total Liabilities INTEREST RATE RISK MANAGEMENT
Slide 14: Capital and Sources of Liquidity
4.75% 6.85% 7.67% 7.39% 6.80% 5.47% 7.83% 8.69% 8.52% 7.79% 2Q21 3Q21 4Q21 1Q22 2Q22 CAPITAL AND SOURCES OF LIQUIDITY REGULATORY CAPITAL AS OF MARCH 31, 2022 Minimum Requirement to be Well-Capitalized under Prompt Corrective Action Provisions Meta Financial Group, Inc. MetaBank, N.A. Capital Ratio T
Slide 15: Appendix
APPENDIX 15Meta Financial Group, Inc. (Nasdaq: CASH) | Quarterly Investor Presentation
Slide 16: Non-GAAP Reconciliation: Adjusted Net Income and Adjusted EPS
NON-GAAP RECONCILIATION 16Meta Financial Group, Inc. (Nasdaq: CASH) | Quarterly Investor Presentation Adjusted Net Income and Adjusted Earnings Per Share ($ in thousands, except per share data) 2Q21 1Q22 2Q22 Net income - GAAP 59,067 61,324 49,251 Less: Gain on sale of trademarks - 50,000 - Less: Re
Slide 17: Non-GAAP Reconciliation: Adjusted Net Charge-offs
1 Tax Services NCOs and average loans are excluded to adjust for the cyclicality of activity related to the overall economics of the Company's tax services business line. 17 For the quarter ended ($ in thousands) Mar 31, 2021 Jun 30, 2021 Sep 30, 2021 Dec 31, 2021 Mar 31, 2022 Net Charge-offs 3,696
Slide 18: Financial Measure Reconciliations
FINANCIAL MEASURE RECONCILIATIONS 18Meta Financial Group, Inc. (Nasdaq: CASH) | Quarterly Investor Presentation For the last twelve months ended ($ in thousands) Mar 31, 2021 Jun 30, 2021 Sep 30, 2021 Dec 31, 2021 Mar 31, 2022 Noninterest Expense - GAAP 320,070 330,352 343,683 353,544 360,733 Net In