Slide 1: Q3 2023 Investor Presentation
The Power to Deliver Solutions Around the world, leading enterprises rely on Cass for our vertical expertise, processing power, and global payment network to execute critical financial transactions while driving greater control and efficiency across critical business expenses. Q3 2023 INVESTOR PRESE
Slide 2: Table of Contents
Forward-Looking Statements Cass at a Glance Financial Performance Revenue & Expenses Balance Sheet Capital ESG Highlights Leadership and Shareholder Information TABLE OF CONTENTS 2 3 4 6 9 14 19 20 www.cassinfo.com / © 2023 Cass Information Systems 21
Slide 3: Forward-Looking Statements
This presentation contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements contain words such as “anticipate,” “believe,” “can,” “would,” “should,” “could,” “may,” “predict,” “seek,” “potential,” “will,” “estimate,”
Slide 4: Cass at a Glance
4www.cassinfo.com / © 2023 Cass Information Systems CASS AT A GLANCE
Slide 5: Cass at a Glance
+ Cass is an information services company that processes freight and facility payments for a number of the largest global companies + The information systems business has a 70-year legacy + As a result of its $90B of payments, Cass generates $1B+ of average non-interest bearing float + Cass continue
Slide 6: Financial Performance
6www.cassinfo.com / © 2023 Cass Information Systems FINANCIAL PERFORMANCE
Slide 7: Q3 2023 Financial Highlights
Q3 2023 FINANCIAL HIGHLIGHTS 7www.cassinfo.com / © 2023 Cass Information Systems $8.80M $7.39M Q3 '22 Q3 '23 $0.64 $0.54 Q3 '22 Q3 '23 16.84% 13.80% Q3 '22 Q3 '23 NET INCOME DILUTED EPS RETURN ON EQUITY + Net income of $7.4 million + Diluted EPS of $0.54 + Return on average equity of 13.80% + Quarte
Slide 8: Quarterly Financial Performance
QUARTERLY FINANCIAL PERFORMANCE 8www.cassinfo.com / © 2023 Cass Information Systems $47.2M $48.9M $49.3M $48.2M $49.2M Q3 '22 Q4 '22 Q1 '23 Q2 '23 Q3 '23 $8.80M $9.29M $7.12M $7.14M $7.39M Q3 '22 Q4 '22 Q1 '23 Q2 '23 Q3 '23 16.84% 18.96% 13.76% 13.37% 13.80% Q3 '22 Q4 '22 Q1 '23 Q2 '23 Q3 '23 $0.64
Slide 9: Revenue & Expenses
9www.cassinfo.com / © 2023 Cass Information Systems REVENUE & EXPENSES
Slide 10: Financial Fees
FINANCIAL FEES 10www.cassinfo.com / © 2023 Cass Information Systems + Despite a decline in transportation dollar volumes which led to a lower average balance of payments in advance of funding, financial fees were up over the same period last year due to the increase in short-term interest rates + Tr
Slide 11: Processing Fees
PROCESSING FEES 11www.cassinfo.com / © 2023 Cass Information Systems + The change quarter to quarter is generally correlated to transportation and facility invoice volumes. + Processing fees increased as compared to 3Q 2022 due to an increase in ancillary fees and facility invoice volumes. The Compa
Slide 12: Net Interest Income
NET INTEREST INCOME 12www.cassinfo.com / © 2023 Cass Information Systems + The increase in short-term interest rates has had a positive impact on net interest income and margin, jumping from 2.90% during 3Q 2022 up to 3.24% in 3Q 2023. + Average interest-earning assets have declined as compared to t
Slide 13: Operating Expense
OPERATING EXPENSE 13www.cassinfo.com / © 2023 Cass Information Systems + Salaries and commissions as well as other benefits have increased due to average FTEs being up 8.1% as compared to 3Q 2022, primarily due to technology initiatives. + Despite the pension plan being frozen resulting in no servic
Slide 14: Balance Sheet
14www.cassinfo.com / © 2023 Cass Information Systems BALANCE SHEET
Slide 15: Loans
LOANS 15www.cassinfo.com / © 2023 Cass Information Systems + Cass has opted to be more selective in booking new loans as a result of the decline in deposits during the first half of 2023, focusing solely on new client relationships. + Cass has not incurred a loan charge-off since 2015 Portfolio Comp
Slide 16: Investment Portfolio Composition
INVESTMENT PORTFOLIO COMPOSITION 16www.cassinfo.com / © 2023 Cass Information Systems + All investment securities are classified as available-for-sale. The overall weighted-average repricing term is 4.0 years and the average yield for 3Q2023 was 2.62%. The portfolio had unrealized losses of $80.5 mi
Slide 17: Funding
FUNDING 17www.cassinfo.com / © 2023 Cass Information Systems + For 3Q 2023, 72.4% of average funding was non-interest bearing, a strategic advantage in current rate environment + The Company experienced deposit attrition during the first half of 2023 as larger commercial clients moved their funds to
Slide 18: Key Funding Points
KEY FUNDING POINTS 18www.cassinfo.com / © 2023 Cass Information Systems + Accounts and drafts payable represents float generated by our payments businesses and have proven a very stable source of funding over a long period of time. + Deposits are generated from core Bank and CassPay clients. These d
Slide 19: Capital
CAPITAL 19www.cassinfo.com / © 2023 Cass Information Systems + Repurchased 73,272 shares of Company stock during 3Q2023 + Maintain excess capital to support organic balance sheet growth and opportunistic acquisitions + Quarterly dividend of $0.30 per share and Cass has continuously paid regularly sc
Slide 20: Environmental, Social and Governance (ESG) Highlights
During March 2023, we published our annual ESG report, a copy of which is available on our Investor Relations site. To read more from the Cass ESG report, please follow this link to cassinfo.com ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) HIGHLIGHTS 20www.cassinfo.com / © 2023 Cass Information System
Slide 21: Leadership and Shareholder Information
LEADERSHIP AND SHAREHOLDER INFORMATION 21www.cassinfo.com / © 2023 Cass Information Systems
Slide 22: Board of Directors
BOARD OF DIRECTORS 22 Eric H. Brunngraber Executive Chairman Ralph W. Clermont Retired Managing Partner, KPMG LLP, Saint Louis, Missouri Robert A. Ebel Retired Chief Executive Officer, Universal Printing Company Wendy J. Henry Retired Managing Partner, BKD, LLP James J. Lindemann Retired Executive V
Slide 23: Leadership Council
LEADERSHIP COUNCIL 23 Cory J. Bricker Vice President - CassPay Carl N. Friedholm Vice President and General Manager - Telecom Expense Management Christi A. Reiter Vice President - Human Resources Nicole M. Jennings Vice President - Internal Audit Martin H. Resch President and Chief Executive Officer
Slide 24: Shareholder Information
SHAREHOLDER INFORMATION 24www.cassinfo.com / © 2023 Cass Information Systems CORPORATE HEADQUARTERS Cass Information Systems, Inc. 12444 Powerscourt Drive, Suite 550 Saint Louis, Missouri 63131 314.506.5500 www.cassinfo.com INVESTOR RELATIONS ir@cassinfo.com COMMON STOCK The company’s common stock t
Slide 25: Thank You for Your Time
Thank You for Your Time Cass Information Systems, Inc: