Pathward Financial, Inc. Announces Results for 2024 Fiscal Third Quarter
Pathward Financial (Nasdaq: CASH) reported Q3 2024 net income of $41.8 million ($1.66/share), down from $45.1 million ($1.68/share) YoY. Total revenue rose 7% to $176.7 million, driven by net interest income gains, though offset by reduced noninterest income. Net interest margin improved to 6.56%. Gross loans and leases grew by $539.7 million to $4.61 billion. Noninterest expense rose 8% to $123.7 million, with a 3% decline in noninterest income to $65.9 million. The company repurchased 286,920 shares at an average price of $52.24. Fiscal 2024 nine-month tax services revenue increased 3% to $82.0 million, with net income from these services up 33% to $47.1 million. Pathward's allowance for credit losses stood at $79.8 million and the company remains well-capitalized.
- Total revenue increased by 7% to $176.7 million.
- Net interest margin improved to 6.56%.
- Gross loans and leases increased by $539.7 million to $4.61 billion.
- Net interest income rose 14% to $110.9 million.
- Repurchased 286,920 shares at an average price of $52.24.
- Tax services product income increased 33% to $47.1 million.
- Net income decreased to $41.8 million from $45.1 million YoY.
- Noninterest income decreased by 3% to $65.9 million.
- Noninterest expense increased by 8% to $123.7 million.
Insights
This earnings report from Pathward Financial shows solid financial performance for Q3 2024, with some notable highlights:
- Net income of
$41.8 million ($1.66 per share), down slightly from$45.1 million ($1.68 per share) in Q3 2023 - Total revenue increased
7% year-over-year to$176.7 million - Net interest margin expanded 38 basis points to
6.56% - Total gross loans and leases grew
13.2% year-over-year to$4.61 billion
The company's focus on balance sheet management and product evolution appears to be paying off. The expansion of commercial finance solutions and merchant services offerings to financial institutions demonstrates Pathward's efforts to diversify revenue streams.
However, there are some potential concerns to note:
- Noninterest income decreased
3% year-over-year, primarily due to lower card and deposit fees - Noninterest expenses increased
8% , driven by higher card processing costs - Nonperforming assets increased to
0.61% of total assets, up from0.50% in the previous quarter
Overall, Pathward appears to be navigating the challenging economic environment reasonably well, but investors should monitor expense growth and asset quality trends going forward.
Pathward Financial's Q3 results reveal a bank that's successfully adapting to a changing financial landscape. The 38 basis point increase in net interest margin to
The
Pathward's expansion into Commercial Finance Solutions for financial institutions is a strategic move that could open up new revenue streams. This diversification could help offset potential volatility in other segments.
However, the increase in nonperforming assets to
The bank's capital ratios remain strong, with a Common Equity Tier 1 ratio of
In summary, Pathward Financial appears to be executing well on its strategy, but should remain vigilant about expense management and asset quality in the coming quarters.
CEO Brett Pharr said, “We are very pleased with our results in the first nine months of fiscal 2024 and continue to execute on what we set out to accomplish this year. Our focus on balance sheet management led by risk adjusted returns and continued evolution of our product offerings have helped us deliver solid financial results. We will continue to build on this foundation next year as we execute on our strategy to be the trusted platform that enables our partners to thrive and allows us to grow with them."
Company Highlights
- On April 30, 2024, Pathward Financial was recognized among Keefe, Bruyette & Woods, Inc. (also known as "KBW") honor roll list of the top banks producing "industry-leading and consistent earnings growth for investors."
- During the quarter, Pathward announced the expansion and transformation of its Solutions for Financial Institutions, which previously only provided prepaid cards to banks and credit unions. With this expansion, Pathward can now also provide Commercial Finance Solutions to their business clients that do not qualify for traditional financing or when a product isn’t offered. Pathward also provides Financial Institutions the ability to offer merchant services to business clients.
Financial Highlights for the 2024 Fiscal Third Quarter
-
Total revenue for the third quarter was
$176.7 million $11.5 million 7% , compared to the same quarter in fiscal 2023, driven by an increase in net interest income, partially offset by a reduction in noninterest income. -
Net interest margin ("NIM") increased 38 basis points to
6.56% for the third quarter from6.18% during the same period last year, primarily driven by increased yields on earning assets and an improved earning asset mix from the continued optimization of the portfolio. When including contractual, rate-related processing expense, NIM would have been4.92% in the fiscal 2024 third quarter compared to4.88% during the fiscal 2023 third quarter. Servicing fee income on off-balance sheet custodial deposits is not included in this calculation. See non-GAAP reconciliation table below. -
Total gross loans and leases at June 30, 2024 increased
$539.7 million $4.61 billion $203.2 million -
During the 2024 fiscal third quarter, the Company repurchased 286,920 shares of common stock at an average share price of
$52.24
Tax Season
For the nine months ended June 30, 2024, total tax services product revenue was
Total tax services product income, net of losses and direct product expenses, increased
Net Interest Income
Net interest income for the third quarter of fiscal 2024 was
The Company’s average interest-earning assets for the third quarter of fiscal 2024 increased by
Fiscal 2024 third quarter NIM increased to
The Company's cost of funds for all deposits and borrowings averaged
Noninterest Income
Fiscal 2024 third quarter noninterest income decreased
The period-over-period decrease in card and deposit fee income was primarily related to lower servicing fee income due to a reduction in custodial deposits. Servicing fee totaled
Noninterest Expense
Noninterest expense increased
The card processing expense increase was due to rate-related agreements with BaaS partners. The amount of expense paid under those agreements is based on an agreed upon rate index that varies depending on the deposit levels, floor rates, market conditions, and other performance conditions. Generally, this rate index is based on a percentage of the Effective Federal Funds Rate ("EFFR") and reprices immediately upon a change in the EFFR. Approximately
Income Tax Expense
The Company recorded income tax expense of
The Company originated
Investments, Loans and Leases |
|||||||||||||||||||
(Dollars in thousands) |
June 30, 2024 |
|
March 31, 2024 |
|
December 31, 2023 |
|
September 30, 2023 |
|
June 30, 2023 |
||||||||||
Total investments |
$ |
1,759,486 |
|
|
$ |
1,814,140 |
|
|
$ |
1,886,021 |
|
|
$ |
1,840,819 |
|
|
$ |
1,951,996 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Loans held for sale |
|
|
|
|
|
|
|
|
|
||||||||||
Term lending |
|
— |
|
|
|
1,977 |
|
|
|
2,500 |
|
|
|
— |
|
|
|
3,000 |
|
Lease financing |
|
— |
|
|
|
— |
|
|
|
778 |
|
|
|
— |
|
|
|
— |
|
SBA/USDA |
|
7,030 |
|
|
|
7,372 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Consumer finance |
|
22,350 |
|
|
|
16,597 |
|
|
|
66,240 |
|
|
|
77,779 |
|
|
|
84,351 |
|
Total loans held for sale |
|
29,380 |
|
|
|
25,946 |
|
|
|
69,518 |
|
|
|
77,779 |
|
|
|
87,351 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Term lending |
|
1,533,722 |
|
|
|
1,489,054 |
|
|
|
1,452,274 |
|
|
|
1,308,133 |
|
|
|
1,253,841 |
|
Asset-based lending |
|
473,289 |
|
|
|
429,556 |
|
|
|
379,681 |
|
|
|
382,371 |
|
|
|
373,160 |
|
Factoring |
|
350,740 |
|
|
|
336,442 |
|
|
|
335,953 |
|
|
|
358,344 |
|
|
|
351,133 |
|
Lease financing |
|
155,044 |
|
|
|
168,616 |
|
|
|
188,889 |
|
|
|
183,392 |
|
|
|
201,996 |
|
Insurance premium finance |
|
617,054 |
|
|
|
522,904 |
|
|
|
671,035 |
|
|
|
800,077 |
|
|
|
666,265 |
|
SBA/USDA |
|
563,689 |
|
|
|
560,433 |
|
|
|
546,048 |
|
|
|
524,750 |
|
|
|
422,389 |
|
Other commercial finance |
|
166,653 |
|
|
|
149,056 |
|
|
|
160,628 |
|
|
|
166,091 |
|
|
|
171,954 |
|
Commercial finance |
|
3,860,191 |
|
|
|
3,656,061 |
|
|
|
3,734,508 |
|
|
|
3,723,158 |
|
|
|
3,440,738 |
|
Consumer finance |
|
253,358 |
|
|
|
267,031 |
|
|
|
301,510 |
|
|
|
254,416 |
|
|
|
200,121 |
|
Tax services |
|
43,184 |
|
|
|
84,502 |
|
|
|
33,435 |
|
|
|
5,192 |
|
|
|
47,194 |
|
Warehouse finance |
|
449,962 |
|
|
|
394,814 |
|
|
|
349,911 |
|
|
|
376,915 |
|
|
|
380,458 |
|
Total loans and leases |
|
4,606,695 |
|
|
|
4,402,408 |
|
|
|
4,419,364 |
|
|
|
4,359,681 |
|
|
|
4,068,511 |
|
Net deferred loan origination costs |
|
5,857 |
|
|
|
6,977 |
|
|
|
6,917 |
|
|
|
6,435 |
|
|
|
4,388 |
|
Total gross loans and leases |
|
4,612,552 |
|
|
|
4,409,385 |
|
|
|
4,426,281 |
|
|
|
4,366,116 |
|
|
|
4,072,899 |
|
Allowance for credit losses |
|
(79,836 |
) |
|
|
(80,777 |
) |
|
|
(53,785 |
) |
|
|
(49,705 |
) |
|
|
(81,916 |
) |
Total loans and leases, net |
$ |
4,532,716 |
|
|
$ |
4,328,608 |
|
|
$ |
4,372,496 |
|
|
$ |
4,316,411 |
|
|
$ |
3,990,983 |
|
The Company's investment security balances at June 30, 2024 totaled
Total gross loans and leases totaled
Commercial finance loans, which comprised
Asset Quality
The Company’s allowance for credit losses ("ACL") totaled
The
The following table presents the Company's ACL as a percentage of its total loans and leases.
|
As of the Period Ended |
|||||||||||||
(Unaudited) |
June 30, 2024 |
|
March 31, 2024 |
|
December 31, 2023 |
|
September 30, 2023 |
|
June 30, 2023 |
|||||
Commercial finance |
1.17 |
% |
1.21 |
% |
1.30 |
% |
1.26 |
% |
1.35 |
% |
||||
Consumer finance |
2.23 |
% |
1.71 |
% |
1.45 |
% |
0.92 |
% |
0.92 |
% |
||||
Tax services |
66.35 |
% |
37.31 |
% |
1.52 |
% |
0.04 |
% |
70.20 |
% |
||||
Warehouse finance |
0.10 |
% |
0.10 |
% |
0.10 |
% |
0.10 |
% |
0.10 |
% |
||||
Total loans and leases |
1.73 |
% |
1.83 |
% |
1.22 |
% |
1.14 |
% |
2.01 |
% |
||||
Total loans and leases excluding tax services |
1.12 |
% |
1.14 |
% |
1.21 |
% |
1.14 |
% |
1.21 |
% |
||||
The Company's ACL as a percentage of total loans and leases decreased to
Activity in the allowance for credit losses for the periods presented was as follows.
(Unaudited) |
Three Months Ended |
|
Nine Months Ended |
||||||||||||||||
(Dollars in thousands) |
June 30, 2024 |
|
March 31, 2024 |
|
June 30, 2023 |
|
June 30, 2024 |
|
June 30, 2023 |
||||||||||
Beginning balance |
$ |
80,777 |
|
$ |
53,785 |
|
$ |
84,304 |
|
|
$ |
49,705 |
|
$ |
45,947 |
|
|||
Provision (reversal of) - tax services loans |
|
(3,285 |
) |
|
25,221 |
|
|
(229 |
) |
|
|
23,292 |
|
|
32,830 |
|
|||
Provision (reversal of) - all other loans and leases |
|
8,926 |
|
|
684 |
|
|
2,059 |
|
|
|
17,820 |
|
|
15,549 |
|
|||
Charge-offs - tax services loans |
|
(820 |
) |
|
— |
|
|
(404 |
) |
|
|
(1,965 |
) |
|
(2,135 |
) |
|||
Charge-offs - all other loans and leases |
|
(7,772 |
) |
|
(5,492 |
) |
|
(5,597 |
) |
|
|
(18,990 |
) |
|
(14,931 |
) |
|||
Recoveries - tax services loans |
|
1,230 |
|
|
5,800 |
|
|
671 |
|
|
|
7,324 |
|
|
2,432 |
|
|||
Recoveries - all other loans and leases |
|
780 |
|
|
779 |
|
|
1,112 |
|
|
|
2,650 |
|
|
2,224 |
|
|||
Ending balance |
$ |
79,836 |
|
$ |
80,777 |
|
$ |
81,916 |
|
|
$ |
79,836 |
|
$ |
81,916 |
|
|||
The Company recognized a provision for credit losses of
The Company's past due loans and leases were as follows for the periods presented.
As of June 30, 2024 |
Accruing and Nonaccruing Loans and Leases |
|
Nonperforming Loans and Leases |
|||||||||||||||||||||||
(Dollars in thousands) |
30-59 Days Past Due |
|
60-89 Days Past Due |
|
> 89 Days Past Due |
|
Total Past Due |
|
Current |
|
Total Loans and Leases Receivable |
|
> 89 Days Past Due and Accruing |
|
Nonaccrual Balance |
|
Total |
|||||||||
Loans held for sale |
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
29,380 |
|
$ |
29,380 |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Commercial finance |
|
28,224 |
|
|
7,348 |
|
|
17,071 |
|
|
52,643 |
|
|
3,807,548 |
|
|
3,860,191 |
|
|
8,427 |
|
|
27,613 |
|
|
36,040 |
Consumer finance |
|
4,496 |
|
|
3,534 |
|
|
8,588 |
|
|
16,618 |
|
|
236,740 |
|
|
253,358 |
|
|
8,588 |
|
|
— |
|
|
8,588 |
Tax services |
|
— |
|
|
43,184 |
|
|
— |
|
|
43,184 |
|
|
— |
|
|
43,184 |
|
|
— |
|
|
— |
|
|
— |
Warehouse finance |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
449,962 |
|
|
449,962 |
|
|
— |
|
|
— |
|
|
— |
Total loans and leases held for investment |
|
32,720 |
|
|
54,066 |
|
|
25,659 |
|
|
112,445 |
|
|
4,494,250 |
|
|
4,606,695 |
|
|
17,015 |
|
|
27,613 |
|
|
44,628 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Total loans and leases |
$ |
32,720 |
|
$ |
54,066 |
|
$ |
25,659 |
|
$ |
112,445 |
|
$ |
4,523,629 |
|
$ |
4,636,074 |
|
$ |
17,015 |
|
$ |
27,613 |
|
$ |
44,628 |
As of March 31, 2024 |
Accruing and Nonaccruing Loans and Leases |
|
Nonperforming Loans and Leases |
|||||||||||||||||||||||
(Dollars in thousands) |
30-59 Days Past Due |
|
60-89 Days Past Due |
|
> 89 Days Past Due |
|
Total Past Due |
|
Current |
|
Total Loans and Leases Receivable |
|
> 89 Days Past Due and Accruing |
|
Nonaccrual Balance |
|
Total |
|||||||||
Loans held for sale |
$ |
323 |
|
$ |
546 |
|
$ |
843 |
|
$ |
1,712 |
|
$ |
24,234 |
|
$ |
25,946 |
|
$ |
843 |
|
$ |
— |
|
$ |
843 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Commercial finance |
|
36,482 |
|
|
23,986 |
|
|
15,596 |
|
|
76,064 |
|
|
3,579,997 |
|
|
3,656,061 |
|
|
2,679 |
|
|
27,781 |
|
|
30,460 |
Consumer finance |
|
4,293 |
|
|
3,001 |
|
|
3,093 |
|
|
10,387 |
|
|
256,644 |
|
|
267,031 |
|
|
3,093 |
|
|
— |
|
|
3,093 |
Tax services |
|
1,123 |
|
|
— |
|
|
— |
|
|
1,123 |
|
|
83,379 |
|
|
84,502 |
|
|
— |
|
|
— |
|
|
— |
Warehouse finance |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
394,814 |
|
|
394,814 |
|
|
— |
|
|
— |
|
|
— |
Total loans and leases held for investment |
|
41,898 |
|
|
26,987 |
|
|
18,689 |
|
|
87,574 |
|
|
4,314,834 |
|
|
4,402,408 |
|
|
5,772 |
|
|
27,781 |
|
|
33,553 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Total loans and leases |
$ |
42,221 |
|
$ |
27,533 |
|
$ |
19,532 |
|
$ |
89,286 |
|
$ |
4,339,068 |
|
$ |
4,428,354 |
|
$ |
6,615 |
|
$ |
27,781 |
|
$ |
34,396 |
The Company's nonperforming assets at June 30, 2024 were
The increase in the nonperforming assets as a percentage of total assets at June 30, 2024 compared to March 31, 2024, was primarily driven by an increase in nonperforming loans in the commercial finance portfolio and an increase in nonperforming loans in the consumer finance portfolio due to seasonal activity. When comparing the current period to the same period of the prior year, the increase in nonperforming assets was primarily due to an increase in nonperforming loans in the consumer finance portfolio.
The Company's nonperforming loans and leases at June 30, 2024, were
The Company has various portfolios of consumer lending and tax services loans that present unique risks that are statistically managed. Due to the unique risks associated with these portfolios, the Company monitors other credit quality indicators in their evaluation of the appropriateness of the allowance for credit losses on these portfolios, and as such, these loans are not included in the asset classification table below. The Company's loans and leases held for investment by asset classification were as follows for the periods presented.
|
Asset Classification |
||||||||||||||||
(Dollars in thousands) |
Pass |
|
Watch |
|
Special Mention |
|
Substandard |
|
Doubtful |
|
Total |
||||||
As of June 30, 2024 |
|
|
|
|
|
|
|||||||||||
Commercial finance |
$ |
3,058,737 |
$ |
537,278 |
$ |
63,523 |
$ |
192,473 |
$ |
8,180 |
$ |
3,860,191 |
|||||
Warehouse finance |
|
449,962 |
|
— |
|
— |
|
— |
|
— |
|
449,962 |
|||||
Total loans and leases |
$ |
3,508,699 |
$ |
537,278 |
$ |
63,523 |
$ |
192,473 |
$ |
8,180 |
$ |
4,310,153 |
|||||
|
Asset Classification |
||||||||||||||||
(Dollars in thousands) |
Pass |
|
Watch |
|
Special Mention |
|
Substandard |
|
Doubtful |
|
Total |
||||||
As of March 31, 2024 |
|
||||||||||||||||
Commercial finance |
$ |
2,893,892 |
$ |
447,110 |
$ |
87,657 |
$ |
218,108 |
$ |
9,294 |
$ |
3,656,061 |
|||||
Warehouse finance |
|
394,814 |
|
— |
|
— |
|
— |
|
— |
|
394,814 |
|||||
Total loans and leases |
$ |
3,288,706 |
$ |
447,110 |
$ |
87,657 |
$ |
218,108 |
$ |
9,294 |
$ |
4,050,875 |
|||||
Deposits, Borrowings and Other Liabilities
The average balance of total deposits and interest-bearing liabilities was
Total end-of-period deposits increased
As of June 30, 2024, the Company had
As of June 30, 2024, the Company managed
Regulatory Capital
The Company and its subsidiary Pathward®, N.A. (the "Bank") remained above the federal regulatory minimum capital requirements at June 30, 2024, and continued to be classified as well-capitalized, and in good standing with the regulatory agencies. Regulatory capital ratios of the Company and the Bank are stated in the table below. Regulatory capital is not affected by the unrealized loss on accumulated other comprehensive income (“AOCI”). The securities portfolio is primarily comprised of amortizing securities that should provide consistent cash flow. The Company does not intend to sell these securities, or recognize the unrealized losses on its income statement, to fund future loan growth.
The tables below include certain non-GAAP financial measures that are used by investors, analysts and bank regulatory agencies to assess the capital position of financial services companies. Management reviews these measures along with other measures of capital as part of its financial analysis.
As of the Periods Indicated |
June 30, 2024(1) |
|
March 31, 2024 |
|
December 31, 2023 |
|
September 30, 2023 |
|
June 30, 2023 |
|||||
Company |
|
|
|
|
|
|
|
|
|
|||||
Tier 1 leverage capital ratio |
9.13 |
% |
|
7.75 |
% |
|
7.96 |
% |
|
8.11 |
% |
|
8.40 |
% |
Common equity Tier 1 capital ratio |
12.44 |
% |
|
12.30 |
% |
|
11.43 |
% |
|
11.25 |
% |
|
11.52 |
% |
Tier 1 capital ratio |
12.70 |
% |
|
12.56 |
% |
|
11.69 |
% |
|
11.50 |
% |
|
11.79 |
% |
Total capital ratio |
14.33 |
% |
|
14.21 |
% |
|
13.12 |
% |
|
12.84 |
% |
|
13.45 |
% |
Bank |
|
|
|
|
|
|
|
|
|
|||||
Tier 1 leverage ratio |
9.36 |
% |
|
7.92 |
% |
|
8.15 |
% |
|
8.32 |
% |
|
8.67 |
% |
Common equity Tier 1 capital ratio |
13.02 |
% |
|
12.83 |
% |
|
11.97 |
% |
|
11.81 |
% |
|
12.17 |
% |
Tier 1 capital ratio |
13.02 |
% |
|
12.83 |
% |
|
11.97 |
% |
|
11.81 |
% |
|
12.17 |
% |
Total capital ratio |
14.27 |
% |
|
14.09 |
% |
|
13.01 |
% |
|
12.76 |
% |
|
13.42 |
% |
(1) |
June 30, 2024 percentages are preliminary pending completion and filing of the Company's regulatory reports. Regulatory capital ratios for periods presented reflect the Company's election of the five-year CECL transition for regulatory capital purposes. |
The following table provides the non-GAAP financial measures used to compute certain of the ratios included in the table above, as well as a reconciliation of such non-GAAP financial measures to the most directly comparable financial measure in accordance with GAAP:
|
Standardized Approach(1) |
||||||||||||||||||
As of the Periods Indicated
(Dollars in thousands) |
June 30, 2024 |
|
March 31, 2024 |
|
December 31, 2023 |
|
September 30, 2023 |
|
June 30, 2023 |
||||||||||
Total stockholders' equity |
$ |
765,248 |
|
|
$ |
739,462 |
|
|
$ |
729,282 |
|
|
$ |
650,625 |
|
|
$ |
677,721 |
|
Adjustments: |
|
|
|
|
|
|
|
|
|
||||||||||
LESS: Goodwill, net of associated deferred tax liabilities |
|
296,496 |
|
|
|
296,889 |
|
|
|
297,283 |
|
|
|
297,679 |
|
|
|
298,092 |
|
LESS: Certain other intangible assets |
|
18,315 |
|
|
|
19,146 |
|
|
|
20,093 |
|
|
|
21,228 |
|
|
|
22,372 |
|
LESS: Net deferred tax assets from operating loss and tax credit carry-forwards |
|
11,880 |
|
|
|
15,862 |
|
|
|
20,253 |
|
|
|
19,679 |
|
|
|
12,157 |
|
LESS: Net unrealized (losses) on available for sale securities |
|
(206,584 |
) |
|
|
(205,460 |
) |
|
|
(187,901 |
) |
|
|
(254,294 |
) |
|
|
(207,358 |
) |
LESS: Noncontrolling interest |
|
(506 |
) |
|
|
(420 |
) |
|
|
(510 |
) |
|
|
(1,005 |
) |
|
|
(631 |
) |
ADD: Adoption of Accounting Standards Update 2016-13 |
|
1,345 |
|
|
|
1,345 |
|
|
|
1,345 |
|
|
|
2,017 |
|
|
|
2,017 |
|
Common Equity Tier 1(1) |
|
646,992 |
|
|
|
614,790 |
|
|
|
581,409 |
|
|
|
569,355 |
|
|
|
555,106 |
|
Long-term borrowings and other instruments qualifying as Tier 1 |
|
13,661 |
|
|
|
13,661 |
|
|
|
13,661 |
|
|
|
13,661 |
|
|
|
13,661 |
|
Tier 1 minority interest not included in common equity Tier 1 capital |
|
(374 |
) |
|
|
(311 |
) |
|
|
(410 |
) |
|
|
(826 |
) |
|
|
(454 |
) |
Total Tier 1 capital |
|
660,279 |
|
|
|
628,140 |
|
|
|
594,660 |
|
|
|
582,190 |
|
|
|
568,313 |
|
Allowance for credit losses |
|
65,182 |
|
|
|
62,715 |
|
|
|
53,037 |
|
|
|
47,960 |
|
|
|
60,489 |
|
Subordinated debentures, net of issuance costs |
|
19,668 |
|
|
|
19,642 |
|
|
|
19,617 |
|
|
|
19,591 |
|
|
|
19,566 |
|
Total capital |
$ |
745,129 |
|
|
$ |
710,497 |
|
|
$ |
667,314 |
|
|
$ |
649,741 |
|
|
$ |
648,368 |
|
(1) |
Capital ratios were determined using the Basel III capital rules that became effective on January 1, 2015. Basel III revised the definition of capital, increased minimum capital ratios, and introduced a minimum CET1 ratio; those changes were fully phased in through the end of calendar year 2021. |
Conference Call
The Company will host a conference call and earnings webcast with a corresponding presentation at 4:00 p.m. Central Time (5:00 p.m. Eastern Time) on Wednesday, July 24, 2024. The live webcast of the call can be accessed from Pathward’s Investor Relations website at www.pathwardfinancial.com. Telephone participants may access the conference call by dialing 1-833-470-1428 approximately 10 minutes prior to start time and reference access code 059075.
The Quarterly Investor Update slide presentation prepared for use in connection with the Company's conference call and earnings webcast is available under the Presentations link in the Investor Relations - Events & Presentations section of the Company's website at www.pathwardfinancial.com. A webcast replay will also be archived at www.pathwardfinancial.com for one year.
Upcoming Investor Events
-
Raymond James
U.S. Bank and Banking on Tech Conference, Sept. 5, 2024 |Chicago, IL
About Pathward Financial, Inc.
Pathward Financial, Inc. (Nasdaq: CASH) is a
Forward-Looking Statements
The Company and the Bank may from time to time make written or oral “forward-looking statements,” including statements contained in this press release, the Company’s filings with the Securities and Exchange Commission ("SEC"), the Company’s reports to stockholders, and in other communications by the Company and the Bank, which are made in good faith by the Company pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995.
You can identify forward-looking statements by words such as “may,” “hope,” “will,” “should,” “expect,” “plan,” “anticipate,” “intend,” “believe,” “estimate,” “predict,” “potential,” “continue,” “could,” “future,” "target," or the negative of those terms, or other words of similar meaning or similar expressions. You should carefully read statements that contain these words because they discuss our future expectations or state other “forward-looking” information. These forward-looking statements are based on information currently available to us and assumptions about future events, and include statements with respect to the Company’s beliefs, expectations, estimates, and intentions, which are subject to significant risks and uncertainties, and are subject to change based on various factors, some of which are beyond the Company’s control. Such risks, uncertainties and other factors may cause our actual growth, results of operations, financial condition, cash flows, performance and business prospects and opportunities to differ materially from those expressed in, or implied by, these forward-looking statements. Such statements address, among others, the following subjects: future operating results including our earnings per diluted share guidance, annual effective tax rate and related performance expectations; progress on key strategic initiatives; expected results of our partnerships; impacts of our improved data analytics, underwriting and monitoring processes; expected nonperforming loan resolutions and net charge off rates; the performance of our securities portfolio; the impact of card balances related to government stimulus programs; customer retention; loan and other product demand; new products and services; credit quality; the level of net charge-offs and the adequacy of the allowance for credit losses; and technology. The following factors, among others, could cause the Company's financial performance and results of operations to differ materially from the expectations, estimates, and intentions expressed in such forward-looking statements: maintaining our executive management team; expected growth opportunities may not be realized or may take longer to realize than expected; the potential adverse effects of unusual and infrequently occurring events, including the impact on financial markets from geopolitical conflicts such as the military conflicts in
The foregoing list of factors is not exclusive. We caution you not to place undue reliance on these forward-looking statements. The forward-looking statements included in this press release speak only as of the date hereof. Additional discussions of factors affecting the Company’s business and prospects are reflected under the caption “Risk Factors” and in other sections of the Company’s Annual Report on Form 10-K for the Company’s fiscal year ended September 30, 2023, and in other filings made with the SEC. The Company expressly disclaims any intent or obligation to update, revise or clarify any forward-looking statements, whether written or oral, that may be made from time to time by or on behalf of the Company or its subsidiaries, whether as a result of new information, changed circumstances, or future events or for any other reason.
Condensed Consolidated Statements of Financial Condition (Unaudited) |
|||||||||||||||||||
(Dollars in Thousands, Except Share Data) |
June 30, 2024 |
|
March 31, 2024 |
|
December 31, 2023 |
|
September 30, 2023 |
|
June 30, 2023 |
||||||||||
ASSETS |
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents |
$ |
298,926 |
|
|
$ |
347,888 |
|
|
$ |
671,630 |
|
|
$ |
375,580 |
|
|
$ |
515,271 |
|
Securities available for sale, at fair value |
|
1,725,460 |
|
|
|
1,779,458 |
|
|
|
1,850,581 |
|
|
|
1,804,228 |
|
|
|
1,914,271 |
|
Securities held to maturity, at amortized cost |
|
34,026 |
|
|
|
34,682 |
|
|
|
35,440 |
|
|
|
36,591 |
|
|
|
37,725 |
|
Federal Reserve Bank and Federal Home Loan Bank Stock, at cost |
|
24,449 |
|
|
|
25,844 |
|
|
|
23,694 |
|
|
|
28,210 |
|
|
|
30,890 |
|
Loans held for sale |
|
29,380 |
|
|
|
25,946 |
|
|
|
69,518 |
|
|
|
77,779 |
|
|
|
87,351 |
|
Loans and leases |
|
4,612,552 |
|
|
|
4,409,385 |
|
|
|
4,426,281 |
|
|
|
4,366,116 |
|
|
|
4,072,899 |
|
Allowance for credit losses |
|
(79,836 |
) |
|
|
(80,777 |
) |
|
|
(53,785 |
) |
|
|
(49,705 |
) |
|
|
(81,916 |
) |
Accrued interest receivable |
|
31,755 |
|
|
|
30,294 |
|
|
|
27,080 |
|
|
|
23,282 |
|
|
|
22,332 |
|
Premises, furniture, and equipment, net |
|
36,953 |
|
|
|
37,266 |
|
|
|
38,270 |
|
|
|
39,160 |
|
|
|
38,601 |
|
Rental equipment, net |
|
209,544 |
|
|
|
215,885 |
|
|
|
228,916 |
|
|
|
211,750 |
|
|
|
224,212 |
|
Goodwill and intangible assets |
|
327,018 |
|
|
|
328,001 |
|
|
|
329,241 |
|
|
|
330,225 |
|
|
|
331,335 |
|
Other assets |
|
280,053 |
|
|
|
283,245 |
|
|
|
280,571 |
|
|
|
292,327 |
|
|
|
265,654 |
|
Total assets |
$ |
7,530,280 |
|
|
$ |
7,437,117 |
|
|
$ |
7,927,437 |
|
|
$ |
7,535,543 |
|
|
$ |
7,458,625 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
LIABILITIES |
|
|
|
|
|
|
|
|
|
||||||||||
Deposits |
|
6,431,516 |
|
|
|
6,368,344 |
|
|
|
6,936,055 |
|
|
|
6,589,182 |
|
|
|
6,306,976 |
|
Short-term borrowings |
|
— |
|
|
|
31,000 |
|
|
|
— |
|
|
|
13,000 |
|
|
|
230,000 |
|
Long-term borrowings |
|
33,329 |
|
|
|
33,373 |
|
|
|
33,614 |
|
|
|
33,873 |
|
|
|
34,178 |
|
Accrued expenses and other liabilities |
|
300,187 |
|
|
|
264,938 |
|
|
|
228,486 |
|
|
|
248,863 |
|
|
|
209,750 |
|
Total liabilities |
|
6,765,032 |
|
|
|
6,697,655 |
|
|
|
7,198,155 |
|
|
|
6,884,918 |
|
|
|
6,780,904 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
|
||||||||||
Preferred stock |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Common stock, |
|
251 |
|
|
|
254 |
|
|
|
260 |
|
|
|
262 |
|
|
|
266 |
|
Common stock, Nonvoting, |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Additional paid-in capital |
|
636,284 |
|
|
|
634,415 |
|
|
|
629,737 |
|
|
|
628,500 |
|
|
|
625,825 |
|
Retained earnings |
|
343,392 |
|
|
|
317,964 |
|
|
|
293,463 |
|
|
|
278,655 |
|
|
|
267,100 |
|
Accumulated other comprehensive loss |
|
(207,992 |
) |
|
|
(206,570 |
) |
|
|
(188,433 |
) |
|
|
(255,443 |
) |
|
|
(207,896 |
) |
Treasury stock, at cost |
|
(6,181 |
) |
|
|
(6,181 |
) |
|
|
(5,235 |
) |
|
|
(344 |
) |
|
|
(6,943 |
) |
Total equity attributable to parent |
|
765,754 |
|
|
|
739,882 |
|
|
|
729,792 |
|
|
|
651,630 |
|
|
|
678,352 |
|
Noncontrolling interest |
|
(506 |
) |
|
|
(420 |
) |
|
|
(510 |
) |
|
|
(1,005 |
) |
|
|
(631 |
) |
Total stockholders’ equity |
|
765,248 |
|
|
|
739,462 |
|
|
|
729,282 |
|
|
|
650,625 |
|
|
|
677,721 |
|
Total liabilities and stockholders’ equity |
$ |
7,530,280 |
|
|
$ |
7,437,117 |
|
|
$ |
7,927,437 |
|
|
$ |
7,535,543 |
|
|
$ |
7,458,625 |
|
Condensed Consolidated Statements of Operations (Unaudited) |
||||||||||||||||
|
Three Months Ended |
|
Nine Months Ended |
|||||||||||||
(Dollars in Thousands, Except Share and Per Share Data) |
June 30, 2024 |
|
March 31, 2024 |
|
June 30, 2023 |
|
June 30, 2024 |
|
June 30, 2023 |
|||||||
Interest and dividend income: |
|
|
|
|
|
|
|
|
|
|||||||
Loans and leases, including fees |
$ |
95,871 |
|
|
$ |
102,750 |
|
$ |
81,242 |
|
|
$ |
293,584 |
|
$ |
233,517 |
Mortgage-backed securities |
|
9,748 |
|
|
|
9,998 |
|
|
10,234 |
|
|
|
29,795 |
|
|
30,972 |
Other investments |
|
8,323 |
|
|
|
14,013 |
|
|
7,870 |
|
|
|
33,222 |
|
|
24,604 |
|
|
113,942 |
|
|
|
126,761 |
|
|
99,346 |
|
|
|
356,601 |
|
|
289,093 |
Interest expense: |
|
|
|
|
|
|
|
|
|
|||||||
Deposits |
|
1,689 |
|
|
|
6,685 |
|
|
164 |
|
|
|
11,900 |
|
|
2,402 |
FHLB advances and other borrowings |
|
1,394 |
|
|
|
1,775 |
|
|
1,717 |
|
|
|
5,505 |
|
|
3,764 |
|
|
3,083 |
|
|
|
8,460 |
|
|
1,881 |
|
|
|
17,405 |
|
|
6,166 |
|
|
|
|
|
|
|
|
|
|
|||||||
Net interest income |
|
110,859 |
|
|
|
118,301 |
|
|
97,465 |
|
|
|
339,196 |
|
|
282,927 |
|
|
|
|
|
|
|
|
|
|
|||||||
Provision for credit loss |
|
5,881 |
|
|
|
26,052 |
|
|
1,773 |
|
|
|
41,823 |
|
|
48,312 |
|
|
|
|
|
|
|
|
|
|
|||||||
Net interest income after provision for credit loss |
|
104,978 |
|
|
|
92,249 |
|
|
95,692 |
|
|
|
297,373 |
|
|
234,615 |
|
|
|
|
|
|
|
|
|
|
|||||||
Noninterest income: |
|
|
|
|
|
|
|
|
|
|||||||
Refund transfer product fees |
|
9,111 |
|
|
|
28,942 |
|
|
8,262 |
|
|
|
38,475 |
|
|
39,144 |
Refund advance fee income |
|
(67 |
) |
|
|
43,200 |
|
|
(927 |
) |
|
|
43,244 |
|
|
37,685 |
Card and deposit fees |
|
33,408 |
|
|
|
35,344 |
|
|
39,708 |
|
|
|
99,502 |
|
|
119,513 |
Rental income |
|
13,779 |
|
|
|
13,720 |
|
|
13,980 |
|
|
|
40,958 |
|
|
39,628 |
Gain on sale of trademarks |
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
10,000 |
Gain on sale of other |
|
4,675 |
|
|
|
1,695 |
|
|
821 |
|
|
|
9,210 |
|
|
657 |
Other income |
|
4,965 |
|
|
|
6,044 |
|
|
5,889 |
|
|
|
16,188 |
|
|
13,921 |
Total noninterest income |
|
65,871 |
|
|
|
128,945 |
|
|
67,733 |
|
|
|
247,577 |
|
|
260,548 |
|
|
|
|
|
|
|
|
|
|
|||||||
Noninterest expense: |
|
|
|
|
|
|
|
|
|
|||||||
Compensation and benefits |
|
48,449 |
|
|
|
54,073 |
|
|
47,402 |
|
|
|
149,174 |
|
|
137,966 |
Refund transfer product expense |
|
2,136 |
|
|
|
7,366 |
|
|
1,727 |
|
|
|
9,694 |
|
|
9,695 |
Refund advance expense |
|
47 |
|
|
|
1,846 |
|
|
239 |
|
|
|
1,923 |
|
|
1,869 |
Card processing |
|
34,314 |
|
|
|
35,163 |
|
|
26,342 |
|
|
|
104,061 |
|
|
75,949 |
Occupancy and equipment expense |
|
9,070 |
|
|
|
9,293 |
|
|
8,595 |
|
|
|
27,211 |
|
|
25,417 |
Operating lease equipment depreciation |
|
10,465 |
|
|
|
10,424 |
|
|
10,517 |
|
|
|
31,312 |
|
|
34,864 |
Legal and consulting |
|
5,410 |
|
|
|
6,141 |
|
|
5,089 |
|
|
|
16,443 |
|
|
19,469 |
Intangible amortization |
|
983 |
|
|
|
1,240 |
|
|
1,168 |
|
|
|
3,207 |
|
|
3,861 |
Impairment expense |
|
999 |
|
|
|
2,013 |
|
|
2,749 |
|
|
|
3,012 |
|
|
3,273 |
Other expense |
|
11,806 |
|
|
|
12,872 |
|
|
10,750 |
|
|
|
37,347 |
|
|
34,410 |
Total noninterest expense |
|
123,679 |
|
|
|
140,431 |
|
|
114,578 |
|
|
|
383,384 |
|
|
346,773 |
|
|
|
|
|
|
|
|
|
|
|||||||
Income before income tax expense |
|
47,170 |
|
|
|
80,763 |
|
|
48,847 |
|
|
|
161,566 |
|
|
148,390 |
|
|
|
|
|
|
|
|
|
|
|||||||
Income tax expense |
|
5,123 |
|
|
|
15,246 |
|
|
3,243 |
|
|
|
26,088 |
|
|
18,996 |
|
|
|
|
|
|
|
|
|
|
|||||||
Net income before noncontrolling interest |
|
42,047 |
|
|
|
65,517 |
|
|
45,604 |
|
|
|
135,478 |
|
|
129,394 |
Net income attributable to noncontrolling interest |
|
212 |
|
|
|
249 |
|
|
508 |
|
|
|
718 |
|
|
1,685 |
Net income attributable to parent |
$ |
41,835 |
|
|
$ |
65,268 |
|
$ |
45,096 |
|
|
$ |
134,760 |
|
$ |
127,709 |
|
|
|
|
|
|
|
|
|
|
|||||||
Less: Allocation of Earnings to participating securities(1) |
|
432 |
|
|
|
524 |
|
|
690 |
|
|
|
1,180 |
|
|
1,920 |
Net income attributable to common shareholders(1) |
|
41,403 |
|
|
|
64,744 |
|
|
44,406 |
|
|
|
133,580 |
|
|
125,789 |
Earnings per common share: |
|
|
|
|
|
|
|
|
|
|||||||
Basic |
$ |
1.66 |
|
|
$ |
2.56 |
|
$ |
1.69 |
|
|
$ |
5.27 |
|
$ |
4.63 |
Diluted |
$ |
1.66 |
|
|
$ |
2.56 |
|
$ |
1.68 |
|
|
$ |
5.27 |
|
$ |
4.62 |
Shares used in computing earnings per common share: |
|
|
|
|
|
|
|
|
|
|||||||
Basic |
|
24,946,085 |
|
|
|
25,281,743 |
|
|
26,346,693 |
|
|
|
25,335,621 |
|
|
27,152,773 |
Diluted |
|
24,979,818 |
|
|
|
25,311,144 |
|
|
26,447,032 |
|
|
|
25,364,642 |
|
|
27,238,801 |
(1) |
Amounts presented are used in the two-class earnings per common share calculation. |
Average Balances, Interest Rates and Yields |
|||||||||||||||||
The following table presents, for the periods indicated, the total dollar amount of interest income from average interest-earning assets and the resulting yields, as well as the interest expense on average interest-bearing liabilities, expressed both in dollars and in rates. Only the yield/rate reflects tax-equivalent adjustments. Nonaccruing loans and leases have been included in the table as loans carrying a zero yield. |
|||||||||||||||||
Three Months Ended June 30, |
2024 |
|
2023 |
||||||||||||||
(Dollars in thousands) |
Average Outstanding Balance |
|
Interest Earned / Paid |
|
Yield / Rate(1) |
|
Average Outstanding Balance |
|
Interest Earned / Paid |
|
Yield / Rate(1) |
||||||
Interest-earning assets: |
|
|
|
|
|
|
|
|
|
|
|
||||||
Cash and fed funds sold |
$ |
224,987 |
|
$ |
2,053 |
|
3.67 |
% |
|
$ |
248,865 |
|
$ |
2,441 |
|
3.93 |
% |
Mortgage-backed securities |
|
1,438,683 |
|
|
9,748 |
|
2.73 |
% |
|
|
1,533,122 |
|
|
10,234 |
|
2.68 |
% |
Tax exempt investment securities |
|
128,117 |
|
|
911 |
|
3.62 |
% |
|
|
145,474 |
|
|
989 |
|
3.45 |
% |
Asset-backed securities |
|
220,461 |
|
|
3,148 |
|
5.74 |
% |
|
|
188,039 |
|
|
2,120 |
|
4.52 |
% |
Other investment securities |
|
282,966 |
|
|
2,211 |
|
3.14 |
% |
|
|
292,025 |
|
|
2,320 |
|
3.19 |
% |
Total investments |
|
2,070,227 |
|
|
16,018 |
|
3.16 |
% |
|
|
2,158,660 |
|
|
15,663 |
|
2.96 |
% |
Commercial finance |
|
3,756,152 |
|
|
78,353 |
|
8.39 |
% |
|
|
3,268,780 |
|
|
68,174 |
|
8.37 |
% |
Consumer finance |
|
286,476 |
|
|
6,865 |
|
9.64 |
% |
|
|
225,470 |
|
|
4,665 |
|
8.30 |
% |
Tax services |
|
56,836 |
|
|
55 |
|
0.39 |
% |
|
|
52,477 |
|
|
25 |
|
0.19 |
% |
Warehouse finance |
|
407,210 |
|
|
10,598 |
|
10.47 |
% |
|
|
372,498 |
|
|
8,378 |
|
9.02 |
% |
Total loans and leases |
|
4,506,674 |
|
|
95,871 |
|
8.56 |
% |
|
|
3,919,225 |
|
|
81,242 |
|
8.31 |
% |
Total interest-earning assets |
$ |
6,801,888 |
|
$ |
113,942 |
|
6.75 |
% |
|
$ |
6,326,750 |
|
$ |
99,346 |
|
6.31 |
% |
Noninterest-earning assets |
|
537,525 |
|
|
|
|
|
|
574,840 |
|
|
|
|
||||
Total assets |
$ |
7,339,413 |
|
|
|
|
|
$ |
6,901,590 |
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Interest-bearing liabilities: |
|
|
|
|
|
|
|
|
|
|
|
||||||
Interest-bearing checking |
$ |
684 |
|
$ |
— |
|
0.14 |
% |
|
$ |
339 |
|
$ |
— |
|
0.22 |
% |
Savings |
|
56,565 |
|
|
3 |
|
0.02 |
% |
|
|
69,310 |
|
|
7 |
|
0.04 |
% |
Money markets |
|
178,255 |
|
|
584 |
|
1.32 |
% |
|
|
126,994 |
|
|
76 |
|
0.24 |
% |
Time deposits |
|
4,265 |
|
|
3 |
|
0.32 |
% |
|
|
6,224 |
|
|
3 |
|
0.19 |
% |
Wholesale deposits |
|
74,167 |
|
|
1,099 |
|
5.96 |
% |
|
|
5,794 |
|
|
78 |
|
5.38 |
% |
Total interest-bearing deposits (a) |
|
313,936 |
|
|
1,689 |
|
2.16 |
% |
|
|
208,661 |
|
|
164 |
|
0.32 |
% |
Overnight fed funds purchased |
|
52,374 |
|
|
730 |
|
5.61 |
% |
|
|
78,320 |
|
|
1,057 |
|
5.42 |
% |
Subordinated debentures |
|
19,651 |
|
|
355 |
|
7.26 |
% |
|
|
19,549 |
|
|
355 |
|
7.28 |
% |
Other borrowings |
|
13,705 |
|
|
309 |
|
9.07 |
% |
|
|
14,850 |
|
|
305 |
|
8.24 |
% |
Total borrowings |
|
85,730 |
|
|
1,394 |
|
6.54 |
% |
|
|
112,719 |
|
|
1,717 |
|
6.11 |
% |
Total interest-bearing liabilities |
|
399,666 |
|
|
3,083 |
|
3.10 |
% |
|
|
321,380 |
|
|
1,881 |
|
2.35 |
% |
Noninterest-bearing deposits (b) |
|
5,947,054 |
|
|
— |
|
— |
% |
|
|
5,686,581 |
|
|
— |
|
— |
% |
Total deposits and interest-bearing liabilities |
$ |
6,346,720 |
|
$ |
3,083 |
|
0.20 |
% |
|
$ |
6,007,961 |
|
$ |
1,881 |
|
0.13 |
% |
Other noninterest-bearing liabilities |
|
252,763 |
|
|
|
|
|
|
206,708 |
|
|
|
|
||||
Total liabilities |
|
6,599,483 |
|
|
|
|
|
|
6,214,669 |
|
|
|
|
||||
Shareholders' equity |
|
739,930 |
|
|
|
|
|
|
686,921 |
|
|
|
|
||||
Total liabilities and shareholders' equity |
$ |
7,339,413 |
|
|
|
|
|
$ |
6,901,590 |
|
|
|
|
||||
Net interest income and net interest rate spread including noninterest-bearing deposits |
|
|
$ |
110,859 |
|
6.56 |
% |
|
|
|
$ |
97,465 |
|
6.19 |
% |
||
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Net interest margin |
|
|
|
|
6.56 |
% |
|
|
|
|
|
6.18 |
% |
||||
Tax-equivalent effect |
|
|
|
|
0.01 |
% |
|
|
|
|
|
0.02 |
% |
||||
Net interest margin, tax-equivalent(2) |
|
|
|
|
6.57 |
% |
|
|
|
|
|
6.20 |
% |
||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Total cost of deposits (a+b) |
|
6,260,990 |
|
|
1,689 |
|
0.11 |
% |
|
|
5,895,242 |
|
|
164 |
|
0.01 |
% |
(1) |
Tax rate used to arrive at the TEY for the three months ended June 30, 2024 and 2023 was |
(2) |
Net interest margin expressed on a fully-taxable-equivalent basis ("net interest margin, tax-equivalent") is a non-GAAP financial measure. The tax-equivalent adjustment to net interest income recognizes the estimated income tax savings when comparing taxable and tax-exempt assets and adjusting for federal and state exemption of interest income. The Company believes that it is a standard practice in the banking industry to present net interest margin expressed on a fully taxable equivalent basis and, accordingly, believes the presentation of this non-GAAP financial measure may be useful for peer comparison purposes. |
Selected Financial Information |
|||||||||||||||||||
As of and For the Three Months Ended |
June 30, 2024 |
|
March 31, 2024 |
|
December 31, 2023 |
|
September 30, 2023 |
|
June 30, 2023 |
||||||||||
Equity to total assets |
|
10.16 |
% |
|
|
9.94 |
% |
|
|
9.20 |
% |
|
|
8.63 |
% |
|
|
9.09 |
% |
Book value per common share outstanding |
$ |
30.51 |
|
|
$ |
29.14 |
|
|
$ |
28.06 |
|
|
$ |
24.85 |
|
|
$ |
25.54 |
|
Tangible book value per common share outstanding |
$ |
17.47 |
|
|
$ |
16.21 |
|
|
$ |
15.39 |
|
|
$ |
12.24 |
|
|
$ |
13.05 |
|
Common shares outstanding |
|
25,085,230 |
|
|
|
25,377,986 |
|
|
|
25,988,230 |
|
|
|
26,183,583 |
|
|
|
26,539,272 |
|
Nonperforming assets to total assets |
|
0.61 |
% |
|
|
0.50 |
% |
|
|
0.53 |
% |
|
|
0.77 |
% |
|
|
0.55 |
% |
Nonperforming loans and leases to total loans and leases |
|
0.96 |
% |
|
|
0.78 |
% |
|
|
0.88 |
% |
|
|
1.26 |
% |
|
|
0.93 |
% |
Net interest margin |
|
6.56 |
% |
|
|
6.23 |
% |
|
|
6.23 |
% |
|
|
6.19 |
% |
|
|
6.18 |
% |
Net interest margin, tax-equivalent |
|
6.57 |
% |
|
|
6.24 |
% |
|
|
6.24 |
% |
|
|
6.21 |
% |
|
|
6.20 |
% |
Return on average assets |
|
2.28 |
% |
|
|
3.17 |
% |
|
|
1.46 |
% |
|
|
1.97 |
% |
|
|
2.61 |
% |
Return on average equity |
|
22.62 |
% |
|
|
35.72 |
% |
|
|
16.87 |
% |
|
|
21.12 |
% |
|
|
26.26 |
% |
Full-time equivalent employees |
|
1,232 |
|
|
|
1,204 |
|
|
|
1,218 |
|
|
|
1,193 |
|
|
|
1,186 |
|
| Net Interest Margin and Cost of Deposits | At and For the Three Months Ended |
||||||||||
(Dollars in thousands) |
June 30, 2024 |
|
March 31, 2024 |
|
June 30, 2023 |
||||||
Average interest earning assets |
$ |
6,801,888 |
|
$ |
7,635,842 |
|
$ |
6,326,750 |
|
||
Net interest income |
$ |
110,859 |
|
$ |
118,301 |
|
$ |
97,465 |
|
||
Net interest margin |
|
6.56 |
% |
|
6.23 |
% |
|
6.18 |
% |
||
Quarterly average total deposits |
$ |
6,260,990 |
|
$ |
7,168,673 |
|
$ |
5,895,242 |
|
||
Deposit interest expense |
$ |
1,689 |
|
$ |
6,685 |
|
$ |
164 |
|
||
Cost of deposits |
|
0.11 |
% |
|
0.38 |
% |
|
0.01 |
% |
||
|
|
|
|
||||||||
Adjusted Net Interest Margin and Adjusted Cost of Deposits |
|
|
|
||||||||
Average interest earning assets |
$ |
6,801,888 |
|
$ |
7,635,842 |
|
$ |
6,326,750 |
|
||
Net interest income |
|
110,859 |
|
|
118,301 |
|
|
97,465 |
|
||
Less: Contractual, rate-related processing expense |
|
27,595 |
|
|
30,094 |
|
|
20,528 |
|
||
Adjusted net interest income |
$ |
83,264 |
|
$ |
88,207 |
|
$ |
76,937 |
|
||
Adjusted net interest margin |
|
4.92 |
% |
|
4.65 |
% |
|
4.88 |
% |
||
Average total deposits |
$ |
6,260,990 |
|
$ |
7,168,673 |
|
$ |
5,895,242 |
|
||
Deposit interest expense |
|
1,689 |
|
|
6,685 |
|
|
164 |
|
||
Add: Contractual, rate-related processing expense |
|
27,595 |
|
|
30,094 |
|
|
20,528 |
|
||
Adjusted deposit expense |
$ |
29,284 |
|
$ |
36,779 |
|
$ |
20,692 |
|
||
Adjusted cost of deposits |
|
1.88 |
% |
|
2.06 |
% |
|
1.41 |
% |
||
View source version on businesswire.com: https://www.businesswire.com/news/home/20240724373717/en/
Investor Relations
Darby Schoenfeld, CPA
SVP, Chief of Staff & Investor Relations
877-497-7497
investorrelations@pathward.com
Media Relations
mediarelations@pathward.com
Source: Pathward Financial, Inc
FAQ
What was Pathward Financial's net income for Q3 2024?
How did Pathward Financial's revenue perform in Q3 2024?
What is Pathward Financial's net interest margin for Q3 2024?
How much did Pathward Financial repurchase in shares during Q3 2024?
What was Pathward Financial's noninterest income in Q3 2024?
What was the increase in gross loans and leases for Pathward Financial in Q3 2024?
