Pathward Financial, Inc. · NASDAQ:CASH
Pathward Financial — Meta Financial Group — Q1 FY2018 Earnings Presentation
20 slides from Pathward Financial's earnings presentation, 2018
Slide 1: Investor Update First Quarter Fiscal Year 2018
Investor Update First Quarter Fiscal Year 2018 First Quarter 2018 | Nasdaq: CASH
Slide 2: Forward-Looking Statements
Forward-Looking Statements Meta Financial Group, Inc.® (the “Company” or "Meta") 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 Se
Slide 3: Crestmark Transaction Overview
Crestmark Transaction Overview Transaction Merger of Crestmark Bancorp, Inc. with and into Meta Financial Group, Inc., and Crestmark Bank with and into MetaBank Meta to exchange each outstanding share of Crestmark for 2.65 shares of Meta common stock (approximately 3.3 million shares to be issued) C
Slide 4: Crestmark Transaction Highlights
Crestmark Transaction Highlights Superb Strategic Fit Financially Compelling Risk Mitigation Factors • Combines two highly-profitable and • Estimated EPS accretion of • Extensive Diligence: Meta, together high-growth earnings-driven cultures approximately 10% in FY2019, with a third-party national a
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 credits and attractive terms for the Community Bank and National Lending programs LEVERAGE DEPOSITS BROUGHT IN FROM OUR
Slide 6: The Meta Ecosystem
The Meta Ecosystem Banking Payments Community Banking Prepaid/ATM/Other Regional community bank with 10 branch locations A prepaid card industry leader with payments in Iowa and South Dakota diversification Growing, profitable operations Continuing to grow “annuity-like” stream of fee income • Loan
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
Slide 8: Financial Highlights
Financial Highlights First Quarter Ended December 31, 2017 Earnings • Quarterly GAAP net income of $4.7 million(1), 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 NII of $26.2 million, an increase of 32% ov
Slide 9: Loan Portfolio ($MM)
Loan Portfolio ($MM) First Quarter Highlights Loan Receivable Composition(1) Total loans receivable, net of allowance for loan losses ("ALL"), increased 36%, Y/Y • Driven primarily by increases in commercial real estate, consumer loans, $1,511 commercial insurance premium finance, and residential mo
Slide 10: Net Interest Margin ("NIM") ($MM)
Net Interest Margin ("NIM")(1) ($MM) 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 $26.2 • Reported NIM reflects the lower corporate prorated tax rate on the Company's tax ex
Slide 11: Earning Asset Mix ($MM)
Earning Asset Mix ($MM) Interest Earning Assets Q1-17 30% $3,223 Fiscal Quarter Average Q2-17 33% $3,962 Q3-17 33% $3,628 Q4-17 35% $3,675 Q1-18 37% $3,762 Tax-Exempt Investment Securities Mortgage-Backed Securities Loans Cash and Other Securities Continue to improve earning asset mix • Asset divers
Slide 12: Balance Sheet Overview ($MM)
Balance Sheet Overview ($MM) Total Average Assets Total Average Liabilities $4,414 Q1-17 $3,139 Fiscal Quarter Average $4,123 Q2-17 $4,022 $4,000 $4,034 Q3-17 $3,575 $3,491 Q4-17 $3,598 Q1-18 $3,689 Q1-17 Q2-17 Q3-17 Q4-17 Q1-18 Fiscal Quarter Average Non-interest bearing deposits Interest bearing d
Slide 13: Regulatory Capital
Regulatory Capital Regulatory Capital Ratios(1) 16.71% 16.71% 16.99% 17.11% 13.38% 12.93% Minimum Requirement to be Well-Capitalized under 9.61% Prompt Corrective Action 7.68% (PCA) Provisions Tier 1 Leverage Common Equity Tier 1 Tier 1 Risk-Based Total Risk-Based Meta Financial Group, Inc. MetaBank
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 sensitivity (what management 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
Slide 16: Industry Recognition
Industry Recognition #1 Top Growth Bank (May 2016) Named one of Fortune magazine's One of the top performing mid-size Named Top Community Bank 100 Fastest-Growing Companies banks in 2016 (June 2017) (August 2016) (September 2017) Top 40 of ACH originators in 2016 EPS Financial Business of the (April
Slide 17: Appendix
Appendix 17 First Quarter 2018 | Nasdaq: CASH
Slide 18: Income Statement
Income Statement Percent Three Months Ended Change Q1 Q2 Q3 Q4 Q1 Q1-18 vs. (dollars in thousands) Dec. 2016 March 2017 June 2017 Sept. 2017 Dec. 2017 Q1-17 Net Interest Income 19,833 23,966 24,943 24,488 26,196 32 % Card Fee Income 18,414 26,547 23,052 26,694 25,247 37 % RT Product Fee Income 176 3
Slide 19: Average Balance Sheet
Average Balance Sheet Percent Fiscal Quarter Average Change Q1 Q2 Q3 Q4 Q1 Q1-18 vs. (dollars in thousands) Dec. 2016 March 2017 June 2017 Sept. 2017 Dec. 2017 Q1-17 Cash and cash equivalents 195,004 404,688 50,235 85,158 120,491 (38)% Investment securities 1,394,596 1,593,130 1,614,529 1,595,587 1,
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 S-4 with the SEC, which will include a joint proxy statement of Meta and Crestmark, which will also constitute a prospe
Meta Financial Group — Q1 FY2018 Earnings Presentation on 6ix