Pathward Financial, Inc. · NASDAQ:CASH
Pathward Financial — Meta Financial Group — Q4 2018 Earnings Presentation
21 slides from Pathward Financial's earnings presentation, 2018
Slide 1: Quarterly Investor Update
Quarterly Investor Update Fourth Quarter and Fiscal Year End 2018 Fourth Quarter & Fiscal Year End 2018 | NASDAQ: CASH
Slide 2: Forward Looking Statements
Forward Looking Statements Meta Financial Group, Inc.® (the “Company”) 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 Securities a
Slide 3: Business Updates
Business Updates(1) Crestmark Bancorp, Inc. Acquisition • On August 1, 2018, Meta completed the previously announced acquisition of Crestmark Bancorp, Inc. and Crestmark Bank. • The fair value of loans and leases receivable acquired on August 1, 2018 pursuant to the Crestmark acquisition was $1.05 b
Slide 4: 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, card industry 25 14 and technology-r
Slide 5: Financial Highlights
Financial Highlights(1) Fourth Quarter Ended September 30, 2018 • Quarterly GAAP net income of $8.7 million and quarterly diluted earnings per share of $0.24. • Fourth quarter fiscal 2018 average assets grew to $5.4 billion, an increase of 33% compared to the 2017 fiscal fourth quarter. • Net intere
Slide 6: Notable Fourth Quarter Impacts
Notable Fourth Quarter Impacts September 30, For the Quarter Ended 2018 Selected Items (pre-tax, unless noted) Loss on sale of securities 6,979 Amended historical tax return of the acquired Crestmark Bancorp entity (tax benefit) 4,644 M&A expenses 3,215 Operational synergies 3,051 Selected Items • $
Slide 7: Selected Financial Data
Selected Financial Data (1) (Dollars in Millions, Except Share and Per Share Data) 2014 2015 2016 2017 2018 At September 30 Total Assets $ 2,054 $ 2,530 $ 4,006 $ 5,228 $ 5,835 Loans and leases receivable, net 493 706 919 1,318 2,932 Deposits 1,367 1,658 2,430 3,223 4,431 Total annual average non-in
Slide 8: Selected Ratios
Selected Ratios(1) For the Fiscal Year Ended or at September 30, (Dollars in Thousands, Except Share and Per Share Data) 2014 2015 2016 2017 2018 Performance Ratios Return on average assets 0.81% 0.78% 1.10% 1.13% 1.12% Return on average equity 10.01% 8.83% 10.80% 11.20% 10.44% Net interest margin,
Slide 9: Lending Divisions Continue Growth Trends
Lending Divisions Continue Growth Trends Driven by Commercial Real Estate and Commercial Insurance Premium Finance (1) Total net loans and leases receivable increased 122%, at September 30, 2018, compared to September 30, 2017 • When excluding Crestmark acquired loans and leases, total net loans and
Slide 10: Diversified Loan Portfolio
Diversified Loan Portfolio National Commercial Lending and Consumer Financing Expected to Further Diversify Portfolio Tax Services <1% National Commercial Finance Community Banking • $1.5 billion national commercial finance • $1.1 billion in community banking portfolio at September 30, 2018 National
Slide 11: Industry Concentrations
Industry Concentrations(1) Crestmark Monitors Loan Concentrations to Specific Industries Industry concentrations in the following graph reflect concentrations in the asset-based lending, factoring, and government guaranteed portfolios, combined. Asset-based Lending • Asset-based lending primarily pr
Slide 12: Asset Quality Remains Strong and Stable
Asset Quality Remains Strong and Stable Disciplined Credit Culture Continues to Drive Strong Asset Quality -$0.3 Combined allowance for loan and lease losses and fair value mark was 0.8%, or $24.4 million, of the total loan portfolio at September 30, 2018, compared to an allowance for loan loss to t
Slide 13: Average Interest Earning Asset Mix Continues to Shift
Average Interest Earning Asset Mix Continues to Shift $4,749 Balance Sheet Restructuring $4,251 During the fiscal 2018 fourth quarter, after the close of the Crestmark $3,762 $3,873 transaction and after board approval, the Company completed a $3,675 balance sheet restructuring to better position th
Slide 14: Net Interest Margin
Net Interest Margin Expansion Bolstered in Fourth Quarter of Fiscal 2018 from Crestmark Acquisition (1) (2) (1) Fiscal 2018 quarterly NIM reflects the lowered corporate prorated tax rate on the Company's tax-exempt municipal portfolio as a result of the Tax Cuts and Jobs Act of 2017. (2) NIM, tax eq
Slide 15: Meta's Funding Advantage
Meta's Funding Advantage Stable, Non-Interest-Bearing Deposit Base Even in a Rising Rate Environment The average balance of total deposits and interest-bearing liabilities was $4.58 billion for the fourth quarter of fiscal 2018, compared to $3.53 billion for the same period in fiscal 2017, represent
Slide 16: Regulatory Capital
Regulatory Capital Strong capital remains well above "well-capitalized" (1) September 30, 2018 Capital Deployment Priorities 1) Growth initiatives 2) Share repurchases 3) Dividend payout Management targets six-month average Bank capital ratios to reduce seasonality(2) • MetaBank six-month average Ti
Slide 17: Goodwill and Intangible Assets
Goodwill and Intangible Assets Majority of intangible amortization expense front-loaded and taken Majority of goodwill resulted from the Crestmark acquisition on August within the next five years. Below table shows expected other intangible 1, 2018. balance. The Company completed an annual goodwill
Slide 18: Appendix
Appendix 18 Fourth Quarter & Fiscal Year End 2018 | NASDAQ: CASH
Slide 19: Quarterly Income Statement
Quarterly Income Statement (1) Percent Three Months Ended Change Q4 Q1 Q2 Q3 Q4 Q4-18 vs. Q4- ($ in thousands) Sept. 2017 Dec. 2017 March 2018 June 2018 Sept. 2018 17 Net Interest Income 24,488 26,196 27,405 28,411 48,537 98% Card Fee Income 26,694 25,247 26,856 22,807 19,536 (27)% RT Product Fee In
Slide 20: Fiscal Year Income Statement
Fiscal Year Income Statement(1) Percent Fiscal Year Ended Change September 30, FY 2018 vs. ($ in thousands) 2014 2015 2016 2017 2018 FY 2017 Net Interest Income 46,262 59,220 77,305 93,230 130,549 40% Card Fee Income 48,738 54,542 70,533 94,707 94,446 —% RT Product Fee Income — — 23,347 38,956 41,87
Slide 21: Average Balance Sheet
Average Balance Sheet Percent Percent Fiscal Year Average Change Fiscal Quarter Average Change FY FY FY FY FY Q4 Q4 FY 2018 vs. Q4-18 vs. ($ in thousands) 2014 2015 2016 2017 2018 FY 2017 2017 2018 Q4-17 Cash and fed funds sold 100,506 127,901 66,759 150,338 87,536 (42)% 73,189 60,946 (17)% Total In