Pathward Financial, Inc. · NASDAQ:CASH
Pathward Financial — Meta Financial Group — Q1 2015 Earnings Presentation
26 slides from Pathward Financial's earnings presentation, Jan 29, 2015
Slide 1: First Quarter 2015 Investor Update
FIRST QUARTER 2015 INVESTOR UPDATE
Slide 2: Forward Looking Statements
FORWARD LOOKING STATEMENTS Meta Financial Group, Inc.®, (“Meta Financial” or “the Company” or “us”) 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 this investor update,
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: MetaBank, Meta Payment Systems, Meta Financial Group
METABANK RETAIL BANK META PAYMENT SYSTEMS META FINANCIAL GROUP LOANS* $590M DEPOSITS* $1,789M STRONG ECONOMY & LOCAL MARKETS > IOWA BUSINESS PARTNERS > NETSPEND> MONEY NETWORK> BLACKHAWK> UNIRUSH> MANY OTHERS > SOUTH DAKOTA * As of 12/31/2014 WHO WE ARE * SPECIALTY LENDING ACCELERATING GROWTH PRODUC
Slide 5: Who We Are
WHO WE ARE GROWING COMMUNITY BANKSTRONG LOCAL ECONOMIES11 BRANCH LOCATIONS IN IOWA AND SOUTH DAKOTASTRONG LOAN GROWTH RETAIL BANK A TOP PREPAID CARD ISSUER IN U.S.ROBUST DEPOSIT GROWTHNEW PARTNERS BEING ADDEDEXISTING PARTNERS EXPANDING NEW PRODUCT INTRODUCTIONS IN 2015 META PAYMENT SYSTEMS * SPECIAL
Slide 6: Retail Bank
> SUCCESSFUL REGIONAL ENTERPRISE60 YEARS IN BUSINESS 11 LOCATIONS IN IOWA AND SOUTH DAKOTAGROWING, PROFITABLE OPERATIONSLOYAL CUSTOMER BASE> DIVERSE CUSTOMER BASE ATTRACTIVE COMBINATION OF COMMERCIAL, AGRICULTURAL & RETAIL> LOAN GROWTH OF 28% ($110.3M) OVER THE LAST 12 MONTHS> EXPECT LOAN GROWTH TO
Slide 7: Retail Bank Locations
RETAIL BANK LOCATIONS > SOUTH DAKOTABROOKINGSSIOUX FALLS> IOWA DES MOINESSTORM LAKE *
Slide 8: Meta Payment Systems
> A LEADER IN THE PREPAID CARD INDUSTRY> PROVIDES MORE THAN $1.45B* IN LOW OR NO-COST DEPOSITS> DEPOSIT GROWTH ~ 21%* OVER THE LAST 12 MONTHS> GROWING EXISTING PARTNER RELATIONSHIPSNETSPENDMONEY NETWORKBLACKHAWKGLOBAL CASH> NEW RELATIONSHIPS DRIVING ACCELERATING GROWTH, STRONG PIPELINEUNIRUSHSTORE F
Slide 9: Deposits and Cost of Funds
DEPOSITS AND COST OF FUNDS AVG. DEPOSITS - $ MILLIONS* COST OF FUNDS * *Quarter Average
Slide 10: AFS / IBEX Asset Acquisition
AFS / IBEX ASSET ACQUISITION * FOUNDED IN 1986, AFS/IBEX WAS ONE OF THE TOP TEN INSURANCE PREMIUM FINANCE COMPANIES IN THE U.S., ORIGINATING LOANS THROUGH A NETWORK OF OVER 1,300 INDEPENDENT INSURANCE AGENCIESFINANCED $230 MILLION OF COMMERCIAL INSURANCE PREMIUMS IN THE TWELVE MONTHS ENDED DECEMBER
Slide 11: 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)SECOND LARGEST PREPAID CARD ISSUER IN THE U.S. RANKED BY PURCHASE VOLUME – THE NILSON REPORT (2
Slide 12: Strategic Goals
STRATEGIC GOALS > GROW MPS DIVISIONSCALABLE, STATE OF THE ART OPERATING INFRASTRUCTURELEVERAGE LOW/NO COST FUNDSROBUST PRODUCT OFFERING RELOADABLE, PAYROLL, GIFT, INCENTIVE, VIRTUAL, AND TRAVELDIVERSIFYING PRODUCT SUITE IN 2015 – PAYMENTS, DEPOSITS, AND CREDITMPS “FINANCIAL INCLUSION” PROGRAMS FOR U
Slide 13: Growing Our Business
> CAPITALIZING ON SYNERGIES: COMMUNITY BANK, MPS, SPECIALTY LENDINGMPS PROVIDES MFG OVER $1.45 BILLION* IN NO-COST FUNDS STRONG LOAN GROWTH IN LOCAL MARKETS AND AFS/IBEXEXPECT MATERIAL BENEFITS WHEN INTEREST RATES RISE> LEVERAGING MPS LEADERSHIP IN PAYMENTS INDUSTRYHIGH-GROWTH INDUSTRY - META HAS LA
Slide 14: Compliance and Oversight Systems
> EARLY ADOPTER OF SOPHISTICATED COMPLIANCE SYSTEMS> OCC CONSENT ORDER REMOVED IN AUGUST 2014> INVESTMENTS IN MPS PROGRAM DESIGN, TRAINING AND TECHNOLOGYIMPLEMENTED ENHANCED BSA/AML TECHNOLOGYENHANCED INFRASTRUCTURE SUPPORTS GROWTH; MODERATING EXPENSES EXPECTEDSHIFTED FOCUS TO BUSINESS DEVELOPMENT O
Slide 15: Positively Leveraged for Higher Rate Environment
> POSITIVELY LEVERAGED FOR HIGHER RATE ENVIRONMENT> OCI VOLATILE RELATIVE TO PEERS GAAP DOES NOT CAPTURE BALANCE SHEET TRUE VALUEMETA MARK INCLUDES ~65% OF ASSETS (SECURITIES) VS. TYPICAL “PEER” AT 20%GAAP OCI DOES NOT RECOGNIZE VALUE OF LOW OR NO-COST DEPOSITS> EXPECTATION FOR CONTINUED, INCREASING
Slide 16: Capital Management
> CAPITAL ENHANCEMENTS$61.0 MILLION IN 2012-13 VIA PRIVATE PLACEMENTS AND AN ATM OFFERINGCURRENT ATM PROCEEDS SUPPORT ORGANIC GROWTH, POSSIBLE ACQUISITIONS AND UPCOMING BASEL III REQUIREMENTS> MAINTAIN STRONG CAPITAL RATIO GOALSCOMMON EQUITY TIER 1 CAPITAL AT LEAST 8%RISK-BASED OVER 15% CAPITAL MANA
Slide 17: MFG Financial Highlights
> NET INCOME$3.6 MILLION IN FISCAL 2015 Q1ADJUSTED $4.8 MILLION, EXCLUDING ITEMS BELOW*, +19% OVER FY14 SAME QUARTER> EARNINGS PROFILEANNUALIZED ROAA OF 0.68% AND ANNUALIZED ROAE OF 8.04% ADJUSTED ANNUALIZED ROAA AND ROAE OF 10.63% AND 0.90% RESPECTIVELY, EXCLUDING ITEMS BELOW*BUSINESS DEVELOPMENT C
Slide 18: Earnings Power While Growing Equity
EARNINGS POWER WHILE GROWING EQUITY *
Slide 19: Balance Sheet ($000s)
BALANCE SHEET ($000S) Q410 Q411 Q412 Q413 Q414 Q114 Q115 CASH AND CASH EQUIVALENTS 94,248 132,149 106,067 73,733 100,159 66,003 89,661 INVESTMENTS AND MBS 511,011 615,320 998,826 1,176,811 1,320,364 1,232,564 1,393,659 LOANS RECEIVABLE NET 369,563 314,484 329,689 364,100 484,690 389,880 527,926 OTHE
Slide 20: Income Statement ($000s)
INCOME STATEMENT ($000S) * Includes $11.4M Gain-on-Sale of GNMA Securities** Includes $2.4M Gain-on-Sale of Securities*** Includes $(1.3)M Loss-on Sale of Securities and $(0.5)M acquisition costs. Adjusting for these amounts, Non-Int. Income for Q115 would have been $13.9M compared to $13.6M for Q11
Slide 21: Total Assets
TOTAL ASSETS 18.6% CAGR $ MILLIONS *
Slide 22: Total Net Loans
TOTAL NET LOANS* *Quarter average Net of ALL $ MILLIONS *
Slide 23: Non-Performing Assets
NON-PERFORMING ASSETS $ MILLIONS OF NON-PERFORMING ASSETS % OF TOTAL ASSETS *
Slide 24: Total Revenue
TOTAL REVENUE * Includes $11.4M Gain-on-Sale of GNMA Securities** Includes $2.4M Gain-on-Sale of Securities*** Includes $(1.3)M Loss-on Sale of Securities and $(0.5)M acquisition costs $ MILLIONS *
Slide 25: Meta Value Proposition
> A LEADING ISSUER OF PREPAID DEBIT CARDSSPRINGBOARD INTO OTHER PRODUCTS AND SERVICES> STRONG CAPITAL POSITIONEARNINGS AND ACCESS TO CAPITAL MARKETS TO FUND OUR GROWTH OBJECTIVESTIER 1 CORE CAPITAL AT DECEMBER 31, 2014 – 8.13%RISK-WEIGHTED CAPITAL AT DECEMBER 31, 2014 – 18.87% > STABLE, LOW COST FUN
Slide 26: Meta Financial Group
Meta® Financial Group’ NASDAQ: CASH