Pathward Financial, Inc. · NASDAQ:CASH
Pathward Financial — Meta Financial Group — Q4 2014 Earnings Presentation
24 slides from Pathward Financial's earnings presentation, Oct 30, 2014
Slide 1: Fourth Quarter 2014 Investor Update
FOURTH QUARTER 2014 INVESTOR UPDATE
Slide 2: Forward Looking Statements
FORWARD LOOKING STATEMENTS Corporate Profile: Meta Financial Group, Inc.®, (“Meta Financial” or the “Company”) and its wholly-owned subsidiary, MetaBank™ (the “Bank” or “MetaBank”), may from time to time make written or oral “forward-looking statements,” including statements contained in its filings
Slide 3: Meta Management
META MANAGEMENT Chairman and Chief Executive Officer, Meta Financial GroupTyler Haahr has been with Meta Financial Group since March 1997. Previously he was a partner with the law firm of Lewis and Roca LLP, Phoenix, Arizona. Tyler received his B.S. degree with honors at the University of South Dako
Slide 4: Who We Are: MetaBank, Retail Bank and Meta Payment Systems
METABANK RETAIL BANK META PAYMENT SYSTEMS META FINANCIAL GROUP LOANS* $493M DEPOSITS** $1,541M STRONG ECONOMY & LOCAL MARKETS > IOWA BUSINESS PARTNERS > NETSPEND> MONEY NETWORK> BLACKHAWK> SEVERAL DOZEN OTHERS > SOUTH DAKOTA * Quarter End – Net of Allowance for Loan Losses (ALL) ** Quarter Average W
Slide 5: Who We Are
WHO WE ARE GROWING COMMUNITY BANKSTRONG LOCAL ECONOMY11 BRANCH LOCATIONS IN IOWA AND SOUTH DAKOTA31% YEAR-OVER-YEAR LOAN GROWTH (FYE) RETAIL BANK DYNAMIC PAYMENT SYSTEMS DIVISIONA TOP PREPAID CARD ISSUER IN USSTRONG DEPOSIT GROWTH NATIONALLY FOCUSED META PAYMENT SYSTEMS *
Slide 6: Recognition
RECOGNITION #68 IN AMERICAN BANKER MAGAZINE “TOP 200 COMMUNITY BANKS AND THRIFTS” (JUNE 2014) TOP 1% BASED ON 3 YEAR ROETOP 100 IN ABA BANKING JOURNAL’S ANNUAL PERFORMANCE RANKING FOR $1B-$10B BANKS (2014)2ND LARGEST PREPAID CARD ISSUER IN THE U.S. RANKED BY PURCHASE VOLUME – THE NILSON REPORT (2014
Slide 7: Strategic Goals
STRATEGIC GOALS > GROW MPS DIVISIONSCALABLE, STATE OF THE ART OPERATING INFRASTRUCTURELEVERAGE LOW/NO COST FUNDSDIVERSE PRODUCT SET: RELOADABLE, PAYROLL, GIFT, INCENTIVE, VIRTUAL, TRAVELMPS “FINANCIAL INCLUSION” PROGRAMS FOR UNBANKED, UNDERBANKED> EXERCISE “EARLY ADOPTER” ADVANTAGE IN REGULATORY COM
Slide 8: Compliance and Competitive Barriers to Entry
> EARLY ADOPTER OF SOPHISTICATED COMPLIANCE SYSTEMS> OCC CONSENT ORDER REMOVED IN AUGUST, 2014> INVESTMENTS IN PROGRAM DESIGN, TRAINING AND TECHNOLOGYIMPLEMENTED ENHANCED BSA/AML TECHNOLOGYENHANCED INFRASTRUCTURE TO SUPPORT GROWTH WITH MODERATING EXPENSESSHIFTING FOCUS TO BUSINESS DEVELOPMENT OPPORT
Slide 9: Growing Our Business
> CAPITALIZING ON SYNERGIES: COMMUNITY BANKING, MPSMPS PROVIDES MFG OVER $1.28 BILLION IN NO-COST FUNDS HIGH GROWTH INDUSTRY SEGMENTEXPECT MATERIAL BENEFITS WHEN INTEREST RATES RISE> LEVERAGING MPS LEADERSHIP IN PREPAID CARD SEGMENTHIGH GROWTH INDUSTRY WITH META HAVING LARGE MARKET SHAREMETA SPONSOR
Slide 10: Deposits and Cost of Funds
DEPOSITS AND COST OF FUNDS AVG. DEPOSITS - $ MILLIONS* COST OF FUNDS *Fourth Quarter Avg. *
Slide 11: Retail Bank
> SUCCESSFUL REGIONAL ENTERPRISE60 YEARS IN BUSINESS 11 LOCATIONS IN IOWA AND SOUTH DAKOTAGROWING, PROFITABLE OPERATIONSSTRONG, LOYAL CUSTOMER BASE> DIVERSE CUSTOMER BASE ATTRACTIVE COMBINATION OF COMMERCIAL, AGRICULTURAL & RETAIL> LOAN GROWTH OF 31% OVER THE LAST YEAR (FYE)> EXPECT LOAN GROWTH TO B
Slide 12: Locations
LOCATIONS > SOUTH DAKOTABROOKINGSSIOUX FALLS> IOWA DES MOINESSTORM LAKE *
Slide 13: Financial Highlights
> NET INCOME$15.71 MILLION IN FISCAL 2014, +17% OVER 2013 AND +33% EXCLUDING SECURITIES GAINS IN 2013> STRONG EARNINGS PROFILEANNUALIZED ROAA OF 0.81% AND ANNUALIZED ROAE OF 10.01% > VERY STRONG ASSET QUALITYNPAS MARKEDLY LOWER THAN PEER GROUP AT 0.05% OF TOTAL ASSETS> PRUDENT CAPITAL MANAGEMENT WIT
Slide 14: Interest Rate Risk Management
> POSITIVELY LEVERAGED FOR HIGHER RATE ENVIRONMENT> OCI VOLATILE RELATIVE TO PEERS GAAP DOES NOT CAPTURE BALANCE SHEET TRUE VALUEMETA MARK INCLUDES ~75% OF ASSETS (SECURITIES) VS. TYPICAL “PEER” AT 20%UNRECOGNIZED VALUE OF LOW OR ZERO COST DEPOSITS> EXPECT NET INTEREST MARGIN (NIM) TO CONTINUE TO IN
Slide 15: Capital Management
> SUCCESSFULLY RAISED $61.0 MILLION IN NEW CAPITAL IN 2012-13 VIA PRIVATE PLACEMENTS AND AN ATM OFFERING> MAINTAIN STRONG CAPITAL RATIOSCOMMON EQUITY TIER 1 CAPITAL AT LEAST 8%RISK-BASED OVER 20%> SUPPORT GROWTH AND ACQUISITION OPPORTUNITIES CAPITAL MANAGEMENT *
Slide 16: Earnings Power While Growing Equity
EARNINGS POWER WHILE GROWING EQUITY Fiscal year end of September 30 *
Slide 17: Balance Sheet ($000s)
BALANCE SHEET ($000S) SEP10 SEP11 SEP12 SEP13 SEP14 CASH AND CASH EQUIVALENTS 94,248 132,149 106,067 73,733 100,159 INVESTMENTS AND MBS 511,011 615,320 998,826 1,176,811 1,320,364 LOANS RECEIVABLE NET 369,563 314,484 329,689 364,100 484,690 OTHER ASSETS 64,037 64,825 61,412 98,760 96,555 ASSETS 1,03
Slide 18: Income Statement ($000s)
INCOME STATEMENT ($000S) * Includes $11.4MM Gain-on-Sale of GNMA Securities** Includes $2.4M Gain-on-Sale of Securities Fiscal Year End of September 30 Meta Financial Group 2010 2011 2012* 2013** 2014 Net Interest Income After Provision 17,299 34,034 32,685 36,022 45,112 Total Non Interest Income 97
Slide 19: Total Assets
TOTAL ASSETS Fiscal Year End of September 30 18.3% CAGR $ MILLIONS *
Slide 20: Total Net Loans
TOTAL NET LOANS* *Net of ALL $ MILLIONS Fiscal Year End September 30 *
Slide 21: Non-Performing Assets
NON-PERFORMING ASSETS Fiscal Year End of September 30 $ MILLIONS OF NON-PERFORMING ASSETS % OF TOTAL ASSETS *
Slide 22: Total Revenue
TOTAL REVENUE * Includes $11.4M Gain-on-Sale of GNMA Securities**Includes $2.4M Gain-on-Sale of Securities $ MILLIONS Fiscal Year End September 30 *
Slide 23: Meta Value Proposition
> LEADING ISSUER OF PREPAID DEBIT CARDSSPRINGBOARD INTO OTHER PRODUCTS AND SERVICES> STRONG CAPITAL POSITIONCAPACITY TO FUND OUR GROWTH OBJECTIVES > STABLE, LOW COST FUNDING ADVANTAGE> STEADY DIVIDEND POLICY > POTENTIAL FOR UPWARD TREND IN EARNINGSHIGHER/NORMALIZED INTEREST RATES ASSET DIVERSIFICATI
Slide 24: Meta Financial Group
Meta® Financial Group’ NASDAQ: CASH