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    Pathward Financial, Inc. Announces Results for 2025 Fiscal First Quarter

    1/21/25 4:10:00 PM ET
    $CASH
    Major Banks
    Finance
    Get the next $CASH alert in real time by email

    Pathward Financial, Inc. ("Pathward Financial" or the "Company") (NASDAQ:CASH) reported net income of $31.4 million, or $1.29 per share, for the three months ended December 31, 2024, compared to net income of $27.7 million, or $1.06 per share, for the three months ended December 31, 2023.

    CEO Brett Pharr said, "Fiscal 2025 started out well as we made good progress against the strategy we laid out last year. During the quarter we completed the sale of our insurance premium finance business along with the subsequent sale of debt securities. This move was another large step toward optimizing our balance sheet by giving us the opportunity to put those funds into higher yielding assets or those with optionality. We also extended two contracts with large, existing partners in Partner Solutions and started tax season with 12% more enrolled tax offices than last year."

    Company Highlights and Business Developments

    • On October 31, 2024, Pathward N.A. (the "Bank") completed the sale of substantially all of the assets and liabilities related to the Bank's commercial insurance premium finance business. The purchase price was $603.3 million, plus a $31.2 million premium. The Bank recorded a $16.4 million pre-tax gain on the sale.
    • On November 30, 2024, the Bank sold $160.6 million of debt securities available for sale ("AFS") with a pre-tax loss on the sale of securities of $15.7 million. This loss largely offsets the gain from the sale of the commercial insurance premium finance business.

    Financial Highlights for the 2025 Fiscal First Quarter

    • Total revenue for the first quarter was $173.5 million, an increase of $10.7 million, or 7%, compared to the same quarter in fiscal 2024, driven by an increase in both net interest income and noninterest income.
    • Net interest margin ("NIM") increased 61 basis points to 6.84% for the first quarter from 6.23% during the same period last year, primarily driven by increased yields and balances in the loan and lease portfolio and an improved earning asset mix from the continued balance sheet optimization. When including contractual, rate-related processing expenses associated with deposits on the Company's balance sheet, NIM would have been 5.41% in the fiscal 2025 first quarter compared to 4.76% during the fiscal 2024 first quarter. See non-GAAP reconciliation table below.
    • Total gross loans and leases at December 31, 2024 increased $136.4 million to $4.56 billion compared to December 31, 2023 and increased $487.5 million when compared to September 30, 2024. When excluding the insurance premium finance loans of $671.0 million at December 31, 2023, total gross loans and leases at December 31, 2024 increased $807.4 million, or 22%, when compared to December 31, 2023.
    • During the 2025 fiscal first quarter, the Company repurchased 701,860 shares of common stock at an average share price of $74.05. As of December 31, 2024, there were 6,298,140 shares available for repurchase under the current common stock share repurchase program.

    Net Interest Income

    Net interest income for the first quarter of fiscal 2025 was $116.1 million, an increase of 6% from the same quarter in fiscal 2024. The increase was mainly attributable to increased yields and balances in the loan and lease portfolio and an improved earning asset mix.

    The Company's average interest-earning assets for the first quarter of fiscal 2025 decreased by $296.0 million to $6.74 billion compared to the same quarter in fiscal 2024, due to decreases in average outstanding balances of total investments and interest earning cash balances, partially offset by an increase in total loan and lease balances. The first quarter average outstanding balance of loans and leases increased $107.6 million compared to the same quarter of the prior fiscal year, primarily due to increases in warehouse finance and tax services loans, partially offset by decreases in commercial finance and consumer finance loans. The decrease in the average outstanding balance of commercial finance loans and leases was primarily driven by the sale of the insurance premium finance loans, partially offset by an increase in term lending, asset-based lending, and SBA/USDA loans.

    Fiscal 2025 first quarter NIM increased to 6.84% from 6.23% in the first fiscal quarter of 2024. When including contractual, rate-related processing expenses associated with deposits on the Company's balance sheet, NIM would have been 5.41% in the first quarter compared to 4.76% during the fiscal 2024 first quarter. See non-GAAP reconciliation table below. The overall reported tax-equivalent yield ("TEY") on average interest-earning assets increased 47 basis points to 7.04% compared to the prior year quarter, driven by an improved earning asset mix. The yield on the loan and lease portfolio was 8.78% compared to 8.33% for the comparable period last year and the TEY on the securities portfolio was 3.10% compared to 3.15% over that same period.

    The Company's cost of funds for all deposits and borrowings averaged 0.20% during the fiscal 2025 first quarter, as compared to 0.35% during the prior year quarter. The Company's overall cost of deposits was 0.05% in the fiscal first quarter of 2025, as compared to 0.21% during the prior year quarter. When including contractual, rate-related processing expenses associated with deposits on the Company's balance sheet, the Company's overall cost of deposits was 1.63% in the fiscal 2025 first quarter, as compared to 1.78% during the prior year quarter. See non-GAAP reconciliation table below.

    Noninterest Income

    Fiscal 2025 first quarter noninterest income increased 9% to $57.4 million, compared to $52.8 million for the same period of the prior year. During the first fiscal quarter of 2025, the Company recognized a gain on divestiture of $16.4 million from the sale of its commercial insurance premium finance business. This gain on divestiture was largely offset by a loss on sale of securities of $15.7 million also recognized during the current quarter. The increase in noninterest income when comparing the current period to the same period of the prior year was primarily driven by an increase in gain on sale of loans and leases, other income, tax services product fees, and rental income. The period-over-period increase was partially offset by a decrease in card and deposit fees and a reduction in gain on sale of other. The increase in gain on sale of loans was primarily driven by SBA/USDA loan sales.

    The period-over-period decrease in card and deposit fee income was primarily related to lower servicing fee income due to a reduction in rates following reductions in the Effective Federal Funds Rate ("EFFR"). Servicing fee income on custodial deposits totaled $4.5 million during the 2025 fiscal first quarter, compared to $5.1 million for the same period of the prior year. For the fiscal quarter ended September 30, 2024, servicing fee income on custodial deposits totaled $3.2 million.

    Noninterest Expense

    Noninterest expense increased 4% to $123.6 million for the fiscal 2025 first quarter, from $119.3 million for the same quarter last year. The increase was primarily attributable to increases in compensation and benefits, operating lease depreciation, occupancy and equipment expense, other expense, and legal and consulting expense. The period-over-period increase was partially offset by decreases in card processing expense.

    The card processing expense decrease was due to rate-related agreements with Partner Solutions relationships. 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 EFFR and reprices immediately upon a change in the EFFR. Approximately 60% of the deposit portfolio was subject to these rate-related processing expenses during the fiscal 2025 first quarter. For the fiscal quarter ended December 31, 2024, contractual, rate-related processing expenses were $25.6 million, as compared to $26.3 million for the fiscal quarter ended September 30, 2024, and $26.8 million for the fiscal quarter ended December 31, 2023.

    Income Tax Expense

    The Company recorded an income tax expense of $6.3 million, representing an effective tax rate of 16.6%, for the fiscal 2025 first quarter, compared to an income tax expense of $5.7 million, representing an effective tax rate of 17.0%, for the first quarter last fiscal year. The current quarter increase in income tax expense compared to the prior year quarter was primarily due to an increase in income and a decrease in investment tax credits.

    The Company originated $9.3 million in renewable energy leases during the fiscal 2025 first quarter, resulting in $3.2 million in total net investment tax credits. During the first quarter of fiscal 2024, the Company originated $12.2 million in renewable energy leases resulting in $4.4 million in total net investment tax credits. Investment tax credits related to renewable energy leases are recognized ratably based on income throughout each fiscal year.

    Investments, Loans and Leases

    (Dollars in thousands)

    December 31, 2024

     

    September 30, 2024

     

    June 30, 2024

     

    March 31, 2024

     

    December 31, 2023

    Total investments

    $

    1,512,091

     

     

    $

    1,774,313

     

     

    $

    1,759,486

     

     

    $

    1,814,140

     

     

    $

    1,886,021

     

     

     

     

     

     

     

     

     

     

     

    Loans held for sale

     

     

     

     

     

     

     

     

     

    Term lending

     

    7,860

     

     

     

    4,567

     

     

     

    —

     

     

     

    1,977

     

     

     

    2,500

     

    Lease financing

     

    424

     

     

     

    —

     

     

     

    —

     

     

     

    —

     

     

     

    778

     

    Insurance premium finance

     

    —

     

     

     

    594,359

     

     

     

    —

     

     

     

    —

     

     

     

    —

     

    SBA/USDA

     

    21,786

     

     

     

    65,734

     

     

     

    7,030

     

     

     

    7,372

     

     

     

    —

     

    Consumer finance

     

    42,578

     

     

     

    24,210

     

     

     

    22,350

     

     

     

    16,597

     

     

     

    66,240

     

    Total loans held for sale

     

    72,648

     

     

     

    688,870

     

     

     

    29,380

     

     

     

    25,946

     

     

     

    69,518

     

     

     

     

     

     

     

     

     

     

     

    Term lending

     

    1,735,539

     

     

     

    1,554,641

     

     

     

    1,533,722

     

     

     

    1,489,054

     

     

     

    1,452,274

     

    Asset-based lending

     

    608,261

     

     

     

    471,897

     

     

     

    473,289

     

     

     

    429,556

     

     

     

    379,681

     

    Factoring

     

    364,477

     

     

     

    362,295

     

     

     

    350,740

     

     

     

    336,442

     

     

     

    335,953

     

    Lease financing

     

    138,305

     

     

     

    152,174

     

     

     

    155,044

     

     

     

    168,616

     

     

     

    188,889

     

    Insurance premium finance

     

    —

     

     

     

    —

     

     

     

    617,054

     

     

     

    522,904

     

     

     

    671,035

     

    SBA/USDA

     

    595,965

     

     

     

    568,628

     

     

     

    563,689

     

     

     

    560,433

     

     

     

    546,048

     

    Other commercial finance

     

    174,097

     

     

     

    185,964

     

     

     

    166,653

     

     

     

    149,056

     

     

     

    160,628

     

    Commercial finance

     

    3,616,644

     

     

     

    3,295,599

     

     

     

    3,860,191

     

     

     

    3,656,061

     

     

     

    3,734,508

     

    Consumer finance

     

    280,001

     

     

     

    248,800

     

     

     

    253,358

     

     

     

    267,031

     

     

     

    301,510

     

    Tax services

     

    45,051

     

     

     

    8,825

     

     

     

    43,184

     

     

     

    84,502

     

     

     

    33,435

     

    Warehouse finance

     

    624,251

     

     

     

    517,847

     

     

     

    449,962

     

     

     

    394,814

     

     

     

    349,911

     

    Total loans and leases

     

    4,565,947

     

     

     

    4,071,071

     

     

     

    4,606,695

     

     

     

    4,402,408

     

     

     

    4,419,364

     

    Net deferred loan origination costs (fees)

     

    (3,266

    )

     

     

    4,124

     

     

     

    5,857

     

     

     

    6,977

     

     

     

    6,917

     

    Total gross loans and leases

     

    4,562,681

     

     

     

    4,075,195

     

     

     

    4,612,552

     

     

     

    4,409,385

     

     

     

    4,426,281

     

    Allowance for credit losses

     

    (48,977

    )

     

     

    (45,336

    )

     

     

    (79,836

    )

     

     

    (80,777

    )

     

     

    (53,785

    )

    Total loans and leases, net

    $

    4,513,704

     

     

    $

    4,029,859

     

     

    $

    4,532,716

     

     

    $

    4,328,608

     

     

    $

    4,372,496

     

    The Company's investment security balances at December 31, 2024 totaled $1.51 billion, as compared to $1.77 billion at September 30, 2024 and $1.89 billion at December 31, 2023. The sequential and year-over-year decreases were primarily related to the sale of $160.6 million of investment securities AFS during the first quarter of fiscal 2025.

    Total gross loans and leases totaled $4.56 billion at December 31, 2024, as compared to $4.08 billion at September 30, 2024 and $4.43 billion at December 31, 2023. The driver for the sequential increase was growth across all loan portfolios. The year-over-year increase was primarily due to increases in warehouse finance and tax services loans, partially offset by decreases in commercial finance and consumer finance. When excluding the insurance premium finance loans of $671.0 million at December 31, 2023, total gross loans and leases at December 31, 2024 increased $807.4 million, or 22%, when compared to December 31, 2023.

    Commercial finance loans, which comprised 79% of the Company's loan and lease portfolio, totaled $3.62 billion at December 31, 2024, reflecting an increase of $321.0 million, 10%, from September 30, 2024 and a decrease of $117.9 million, or 3%, from December 31, 2023. The sequential increase was primarily driven by increases of $180.9 million in term lending and $136.4 million in asset-based lending. The year-over-year decrease was primarily related to the sale of insurance premium finance loans during the first quarter of fiscal 2025, partially offset by increases of $283.3 million in term lending, $228.6 million in asset-based lending, and $49.9 million in SBA/USDA. When excluding the insurance premium finance loans of $671.0 million at December 31, 2023, commercial finance loans at December 31, 2024 increased by $553.2 million when compared to December 31, 2023.

    Asset Quality

    The Company's allowance for credit losses ("ACL") totaled $49.0 million at December 31, 2024, an increase compared to $45.3 million at September 30, 2024 and a decrease compared to $53.8 million at December 31, 2023. The increase in the ACL at December 31, 2024, when compared to September 30, 2024, was primarily due to a $2.8 million increase in the allowance related to the consumer finance portfolio due to seasonal activity and a $0.8 million increase in the allowance related to the seasonal tax services portfolio.

    The $4.8 million year-over-year decrease in the ACL was primarily driven by a $6.0 million decrease in the allowance related to the commercial finance portfolio, due in part to the sale of the insurance premium finance loans, partially offset by a $0.6 million increase in the allowance related to the consumer finance portfolio, a $0.3 million increase in the allowance related to the seasonal tax services portfolio, and a $0.3 million increase in the allowance related to the warehouse finance portfolio.

    The following table presents the Company's ACL as a percentage of its total loans and leases.

     

    As of the Period Ended

    (Unaudited)

    December 31, 2024

    September 30, 2024

    June 30, 2024

    March 31, 2024

    December 31, 2023

    Commercial finance

    1.18

    %

    1.29

    %

    1.17

    %

    1.21

    %

    1.30

    %

    Consumer finance

    1.79

    %

    0.90

    %

    2.23

    %

    1.71

    %

    1.45

    %

    Tax services

    1.75

    %

    0.02

    %

    66.35

    %

    37.31

    %

    1.52

    %

    Warehouse finance

    0.10

    %

    0.10

    %

    0.10

    %

    0.10

    %

    0.10

    %

    Total loans and leases

    1.07

    %

    1.11

    %

    1.73

    %

    1.83

    %

    1.22

    %

    Total loans and leases excluding tax services

    1.07

    %

    1.12

    %

    1.12

    %

    1.14

    %

    1.21

    %

    The Company's ACL as a percentage of total loans and leases decreased to 1.07% at December 31, 2024 from 1.11% at September 30, 2024. The decrease in the total loans and leases coverage ratio was primarily driven by the commercial finance portfolio, partially offset by an increase in the seasonal tax services portfolio and consumer finance portfolio. The increase in the tax services and consumer finance portfolios loan coverage ratios was due to seasonal activity.

    Activity in the allowance for credit losses for the periods presented was as follows.

    (Unaudited)

    Three Months Ended

    (Dollars in thousands)

    December 31, 2024

    September 30, 2024

    December 31, 2023

    Beginning balance

    $

    45,336

     

    $

    79,836

     

    $

    49,705

     

    Provision (reversal of) - tax services loans

     

    1,301

     

     

    (297

    )

     

    1,356

     

    Provision (reversal of) - all other loans and leases

     

    10,913

     

     

    1,423

     

     

    8,210

     

    Charge-offs - tax services loans

     

    (741

    )

     

    (28,815

    )

     

    (1,145

    )

    Charge-offs - all other loans and leases

     

    (8,935

    )

     

    (7,912

    )

     

    (5,725

    )

    Recoveries - tax services loans

     

    228

     

     

    461

     

     

    294

     

    Recoveries - all other loans and leases

     

    875

     

     

    640

     

     

    1,090

     

    Ending balance

    $

    48,977

     

    $

    45,336

     

    $

    53,785

     

    The Company recognized a provision for credit losses of $12.0 million for the quarter ended December 31, 2024, compared to $9.9 million for the comparable period in the prior fiscal year. The period-over-period increase in provision for credit losses was primarily due to increases in provision for credit losses in the commercial finance portfolio of $1.9 million, the consumer finance portfolio of $0.7 million, and the warehouse finance portfolio of $0.1 million, partially offset by a decrease of $0.1 million in provision for credit losses tax services portfolio. The Company recognized net charge-offs of $8.6 million for the quarter ended December 31, 2024, compared to net charge-offs of $5.5 million for the quarter ended December 31, 2023. Net charge-offs attributable to the commercial finance and seasonal tax services portfolios for the current quarter were $8.1 million and $0.5 million, respectively. Net charge-offs attributable to the commercial finance, tax services, and consumer finance portfolios for the same quarter of the prior year were $4.6 million, $0.8 million, and $0.1 million, respectively.

    The Company's past due loans and leases were as follows for the periods presented.

    As of December 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

    $

    —

     

    $

    —

     

    $

    —

     

    $

    —

     

    $

    72,648

     

    $

    72,648

     

    $

    —

     

    $

    —

     

    $

    —

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Commercial finance

     

    25,080

     

     

    8,966

     

     

    23,545

     

     

    57,591

     

     

    3,559,053

     

     

    3,616,644

     

     

    5,555

     

     

    27,231

     

     

    32,786

    Consumer finance

     

    4,502

     

     

    2,936

     

     

    2,423

     

     

    9,861

     

     

    270,140

     

     

    280,001

     

     

    2,423

     

     

    —

     

     

    2,423

    Tax services

     

    —

     

     

    —

     

     

    —

     

     

    —

     

     

    45,051

     

     

    45,051

     

     

    —

     

     

    —

     

     

    —

    Warehouse finance

     

    —

     

     

    —

     

     

    —

     

     

    —

     

     

    624,251

     

     

    624,251

     

     

    —

     

     

    —

     

     

    —

    Total loans and leases held for investment

     

    29,582

     

     

    11,902

     

     

    25,968

     

     

    67,452

     

     

    4,498,495

     

     

    4,565,947

     

     

    7,978

     

     

    27,231

     

     

    35,209

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Total loans and leases

    $

    29,582

     

    $

    11,902

     

    $

    25,968

     

    $

    67,452

     

    $

    4,571,143

     

    $

    4,638,595

     

    $

    7,978

     

    $

    27,231

     

    $

    35,209

    As of September 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

    $

    2,266

     

    $

    1,361

     

    $

    1,050

     

    $

    4,677

     

    $

    684,193

     

    $

    688,870

     

    $

    1,050

     

    $

    —

     

    $

    1,050

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Commercial finance

     

    23,381

     

     

    7,671

     

     

    19,975

     

     

    51,027

     

     

    3,244,572

     

     

    3,295,599

     

     

    2,314

     

     

    26,412

     

     

    28,726

    Consumer finance

     

    3,962

     

     

    3,186

     

     

    3,053

     

     

    10,201

     

     

    238,599

     

     

    248,800

     

     

    3,053

     

     

    —

     

     

    3,053

    Tax services

     

    —

     

     

    —

     

     

    8,733

     

     

    8,733

     

     

    92

     

     

    8,825

     

     

    8,733

     

     

    —

     

     

    8,733

    Warehouse finance

     

    —

     

     

    —

     

     

    —

     

     

    —

     

     

    517,847

     

     

    517,847

     

     

    —

     

     

    —

     

     

    —

    Total loans and leases held for investment

     

    27,343

     

     

    10,857

     

     

    31,761

     

     

    69,961

     

     

    4,001,110

     

     

    4,071,071

     

     

    14,100

     

     

    26,412

     

     

    40,512

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Total loans and leases

    $

    29,609

     

    $

    12,218

     

    $

    32,811

     

    $

    74,638

     

    $

    4,685,303

     

    $

    4,759,941

     

    $

    15,150

     

    $

    26,412

     

    $

    41,562

    The Company's nonperforming assets at December 31, 2024 were $37.5 million, representing 0.49% of total assets, compared to $43.0 million, or 0.57% of total assets at September 30, 2024 and $42.4 million, or 0.53% of total assets at December 31, 2023.

    The decrease in the nonperforming assets as a percentage of total assets at December 31, 2024 compared to September 30, 2024, was primarily driven by a decrease in nonperforming loans in the seasonal tax services and consumer finance portfolios, partially offset by an increase in nonperforming loans in the commercial finance portfolio. When comparing the current period to the same period of the prior year, the decrease in nonperforming assets was primarily due to decreases in nonperforming loans in the commercial finance and consumer finance portfolios.

    The Company's nonperforming loans and leases at December 31, 2024, were $35.2 million, representing 0.76% of total gross loans and leases, compared to $41.6 million, or 0.87% of total gross loans and leases at September 30, 2024 and $39.5 million, or 0.88% of total gross loans and leases at December 31, 2023.

    Deposits, Borrowings and Other Liabilities

    The average balance of total deposits and interest-bearing liabilities was $6.25 billion for the three-month period ended December 31, 2024, compared to $6.71 billion for the same period in the prior fiscal year. Total average deposits for the fiscal 2025 first quarter decreased by $477.0 million to $6.08 billion compared to the same period in fiscal 2024. The decrease in average deposits was primarily due to decreases in noninterest bearing deposits and wholesale deposits.

    Total end-of-period deposits decreased 6% to $6.52 billion at December 31, 2024, compared to $6.94 billion at December 31, 2023. The decrease in end-of-period deposits was primarily driven by decreases in noninterest-bearing deposits of $264.9 million and wholesale deposits of $140.6 million.

    As of December 31, 2024, the Company had $416.1 million in deposits related to government stimulus programs.

    As of December 31, 2024, the Company managed $840.5 million of customer deposits at other banks in its capacity as custodian. These deposits provide the Company with the ability to earn servicing fee income, typically reflective of the EFFR. The sequential quarter increase in these customer deposits held at other banks reflects normal seasonal patterns during the first quarter of the fiscal year.

    Regulatory Capital

    The Company and its subsidiary Pathward®, N.A. (the "Bank") remained above the federal regulatory minimum capital requirements at December 31, 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 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

    December 31, 2024(1)

     

    September 30, 2024

     

    June 30,

    2024

     

    March 31,

    2024

     

    December 31,

    2023

    Company

     

     

     

     

     

     

     

     

     

    Tier 1 leverage capital ratio

    9.15

    %

     

    9.26

    %

     

    9.13

    %

     

    7.75

    %

     

    7.96

    %

    Common equity Tier 1 capital ratio

    12.53

    %

     

    12.61

    %

     

    12.44

    %

     

    12.30

    %

     

    11.43

    %

    Tier 1 capital ratio

    12.79

    %

     

    12.86

    %

     

    12.70

    %

     

    12.56

    %

     

    11.69

    %

    Total capital ratio

    14.11

    %

     

    14.08

    %

     

    14.33

    %

     

    14.21

    %

     

    13.12

    %

    Bank

     

     

     

     

     

     

     

     

     

    Tier 1 leverage ratio

    9.42

    %

     

    9.44

    %

     

    9.36

    %

     

    7.92

    %

     

    8.15

    %

    Common equity Tier 1 capital ratio

    13.16

    %

     

    13.12

    %

     

    13.02

    %

     

    12.83

    %

     

    11.97

    %

    Tier 1 capital ratio

    13.16

    %

     

    13.12

    %

     

    13.02

    %

     

    12.83

    %

     

    11.97

    %

    Total capital ratio

    14.10

    %

     

    13.97

    %

     

    14.27

    %

     

    14.09

    %

     

    13.01

    %

    (1)

    December 31, 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)

    December 31,

    2024

     

    September 30,

    2024

     

    June 30,

    2024

     

    March 31,

    2024

     

    December 31,

    2023

    Total stockholders' equity

    $

    776,430

     

     

    $

    839,605

     

     

    $

    765,248

     

     

    $

    739,462

     

     

    $

    729,282

     

    Adjustments:

     

     

     

     

     

     

     

     

     

    LESS: Goodwill, net of associated deferred tax liabilities

     

    286,171

     

     

     

    296,105

     

     

     

    296,496

     

     

     

    296,889

     

     

     

    297,283

     

    LESS: Certain other intangible assets

     

    16,951

     

     

     

    18,018

     

     

     

    18,315

     

     

     

    19,146

     

     

     

    20,093

     

    LESS: Net deferred tax assets from operating loss and tax credit carry-forwards

     

    12,298

     

     

     

    13,253

     

     

     

    11,880

     

     

     

    15,862

     

     

     

    20,253

     

    LESS: Net unrealized (losses) on available for sale securities

     

    (187,834

    )

     

     

    (152,328

    )

     

     

    (206,584

    )

     

     

    (205,460

    )

     

     

    (187,901

    )

    LESS: Noncontrolling interest

     

    (756

    )

     

     

    (277

    )

     

     

    (506

    )

     

     

    (420

    )

     

     

    (510

    )

    ADD: Adoption of Accounting Standards Update 2016-13

     

    672

     

     

     

    1,345

     

     

     

    1,345

     

     

     

    1,345

     

     

     

    1,345

     

    Common Equity Tier 1(1)

     

    650,272

     

     

     

    666,179

     

     

     

    646,992

     

     

     

    614,790

     

     

     

    581,409

     

    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

     

    (462

    )

     

     

    (150

    )

     

     

    (374

    )

     

     

    (311

    )

     

     

    (410

    )

    Total Tier 1 capital

     

    663,471

     

     

     

    679,690

     

     

     

    660,279

     

     

     

    628,140

     

     

     

    594,660

     

    Allowance for credit losses

     

    48,818

     

     

     

    44,687

     

     

     

    65,182

     

     

     

    62,715

     

     

     

    53,037

     

    Subordinated debentures, net of issuance costs

     

    19,719

     

     

     

    19,693

     

     

     

    19,668

     

     

     

    19,642

     

     

     

    19,617

     

    Total capital

    $

    732,008

     

     

    $

    744,070

     

     

    $

    745,129

     

     

    $

    710,497

     

     

    $

    667,314

     

    (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 Tuesday, January 21, 2025. 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 228214.

    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.

    About Pathward Financial, Inc.

    Pathward Financial, Inc. (NASDAQ:CASH) is a U.S.-based financial holding company driven by its purpose to power financial inclusion for all. Through our subsidiary, Pathward®, N.A., we strive to increase financial availability, choice, and opportunity across our Partner Solutions and Commercial Finance business lines. These strategic business lines provide support to individuals and businesses. Learn more at www.pathwardfinancial.com.

    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; 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 Ukraine and the Middle East, weather-related disasters, or public health events, such as pandemics, and any governmental or societal responses thereto; our ability to successfully implement measures designed to reduce expenses and increase efficiencies; changes in trade, monetary, and fiscal policies and laws, including actual changes in interest rates and the Fed Funds rate, and their related impacts on macroeconomic conditions, customer behavior, funding costs and loan and securities portfolios; changes in tax laws; the strength of the United States' economy and the local economies in which the Company operates; adverse developments in the financial services industry generally such as bank failures, responsive measures to mitigate and manage such developments, related supervisory and regulatory actions and costs, and related impacts on customer behavior; inflation, market, and monetary fluctuations; our liquidity and capital positions, including the sufficiency of our liquidity; the timely and efficient development of new products and services offered by the Company or its strategic partners, as well as risks (including reputational and litigation) attendant thereto, and the perceived overall value and acceptance of these products and services by users; the Bank's ability to maintain its Durbin Amendment exemption; the risks of dealing with or utilizing third parties, including, in connection with the Company's prepaid card and tax refund advance businesses, the risk of reduced volume of refund advance loans as a result of reduced customer demand for or usage of the Bank's strategic partners' refund advance products; our relationship with and any actions which may be initiated by our regulators, and any related increases in compliance and other costs; changes in financial services laws and regulations, including laws and regulations relating to the tax refund industry and the insurance premium finance industry; technological changes, including, but not limited to, the protection of our electronic systems and information; the impact of acquisitions and divestitures; litigation risk; the growth of the Company's business, as well as expenses related thereto; continued maintenance by the Bank of its status as a well-capitalized institution; changes in consumer borrowing, spending and saving habits; losses from fraudulent or illegal activity; technological risks and developments and cyber threats, attacks, or events; and the success of the Company at maintaining its high quality asset level and managing and collecting assets of borrowers in default should problem assets increase.

    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, 2024, 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)

    December 31, 2024

     

    September 30, 2024

     

    June 30, 2024

     

    March 31, 2024

     

    December 31, 2023

    ASSETS

     

     

     

     

     

     

     

     

     

    Cash and cash equivalents

    $

    597,396

     

     

    $

    158,337

     

     

    $

    298,926

     

     

    $

    347,888

     

     

    $

    671,630

     

    Securities available for sale, at fair value

     

    1,480,090

     

     

     

    1,741,221

     

     

     

    1,725,460

     

     

     

    1,779,458

     

     

     

    1,850,581

     

    Securities held to maturity, at amortized cost

     

    32,001

     

     

     

    33,092

     

     

     

    34,026

     

     

     

    34,682

     

     

     

    35,440

     

    Federal Reserve Bank and Federal Home Loan Bank Stock, at cost

     

    24,454

     

     

     

    36,014

     

     

     

    24,449

     

     

     

    25,844

     

     

     

    23,694

     

    Loans held for sale

     

    72,648

     

     

     

    688,870

     

     

     

    29,380

     

     

     

    25,946

     

     

     

    69,518

     

    Loans and leases

     

    4,562,681

     

     

     

    4,075,195

     

     

     

    4,612,552

     

     

     

    4,409,385

     

     

     

    4,426,281

     

    Allowance for credit losses

     

    (48,977

    )

     

     

    (45,336

    )

     

     

    (79,836

    )

     

     

    (80,777

    )

     

     

    (53,785

    )

    Accrued interest receivable

     

    35,279

     

     

     

    31,385

     

     

     

    31,755

     

     

     

    30,294

     

     

     

    27,080

     

    Premises, furniture, and equipment, net

     

    38,263

     

     

     

    39,055

     

     

     

    36,953

     

     

     

    37,266

     

     

     

    38,270

     

    Rental equipment, net

     

    206,754

     

     

     

    205,339

     

     

     

    209,544

     

     

     

    215,885

     

     

     

    228,916

     

    Goodwill and intangible assets

     

    313,074

     

     

     

    326,094

     

     

     

    327,018

     

     

     

    328,001

     

     

     

    329,241

     

    Other assets

     

    308,679

     

     

     

    260,070

     

     

     

    280,053

     

     

     

    283,245

     

     

     

    280,571

     

    Total assets

    $

    7,622,342

     

     

    $

    7,549,336

     

     

    $

    7,530,280

     

     

    $

    7,437,117

     

     

    $

    7,927,437

     

     

     

     

     

     

     

     

     

     

     

    LIABILITIES AND STOCKHOLDERS' EQUITY

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    LIABILITIES

     

     

     

     

     

     

     

     

     

    Deposits

     

    6,518,953

     

     

     

    5,875,085

     

     

     

    6,431,516

     

     

     

    6,368,344

     

     

     

    6,936,055

     

    Short-term borrowings

     

    —

     

     

     

    377,000

     

     

     

    —

     

     

     

    31,000

     

     

     

    —

     

    Long-term borrowings

     

    33,380

     

     

     

    33,354

     

     

     

    33,329

     

     

     

    33,373

     

     

     

    33,614

     

    Accrued expenses and other liabilities

     

    293,579

     

     

     

    424,292

     

     

     

    300,187

     

     

     

    264,938

     

     

     

    228,486

     

    Total liabilities

     

    6,845,912

     

     

     

    6,709,731

     

     

     

    6,765,032

     

     

     

    6,697,655

     

     

     

    7,198,155

     

     

     

     

     

     

     

     

     

     

     

    STOCKHOLDERS' EQUITY

     

     

     

     

     

     

     

     

     

    Preferred stock

     

    —

     

     

     

    —

     

     

     

    —

     

     

     

    —

     

     

     

    —

     

    Common stock, $.01 par value

     

    241

     

     

     

    248

     

     

     

    251

     

     

     

    254

     

     

     

    260

     

    Common stock, Nonvoting, $.01 par value

     

    —

     

     

     

    —

     

     

     

    —

     

     

     

    —

     

     

     

    —

     

    Additional paid-in capital

     

    640,422

     

     

     

    638,803

     

     

     

    636,284

     

     

     

    634,415

     

     

     

    629,737

     

    Retained earnings

     

    332,322

     

     

     

    354,474

     

     

     

    343,392

     

     

     

    317,964

     

     

     

    293,463

     

    Accumulated other comprehensive loss

     

    (190,917

    )

     

     

    (153,394

    )

     

     

    (207,992

    )

     

     

    (206,570

    )

     

     

    (188,433

    )

    Treasury stock, at cost

     

    (4,882

    )

     

     

    (249

    )

     

     

    (6,181

    )

     

     

    (6,181

    )

     

     

    (5,235

    )

    Total equity attributable to parent

     

    777,186

     

     

     

    839,882

     

     

     

    765,754

     

     

     

    739,882

     

     

     

    729,792

     

    Noncontrolling interest

     

    (756

    )

     

     

    (277

    )

     

     

    (506

    )

     

     

    (420

    )

     

     

    (510

    )

    Total stockholders' equity

     

    776,430

     

     

     

    839,605

     

     

     

    765,248

     

     

     

    739,462

     

     

     

    729,282

     

    Total liabilities and stockholders' equity

    $

    7,622,342

     

     

    $

    7,549,336

     

     

    $

    7,530,280

     

     

    $

    7,437,117

     

     

    $

    7,927,437

     

    Condensed Consolidated Statements of Operations (Unaudited)

       

     

    Three Months Ended

    (Dollars in Thousands, Except Share and Per Share Data)

    December 31, 2024

     

    September 30, 2024

     

    December 31, 2023

    Interest and dividend income:

     

     

     

     

     

    Loans and leases, including fees

    $

    102,731

     

     

    $

    102,292

     

    $

    94,963

     

    Mortgage-backed securities

     

    8,986

     

     

     

    9,607

     

     

    10,049

     

    Other investments

     

    7,522

     

     

     

    7,851

     

     

    10,886

     

     

     

    119,239

     

     

     

    119,750

     

     

    115,898

     

    Interest expense:

     

     

     

     

     

    Deposits

     

    775

     

     

     

    1,119

     

     

    3,526

     

    FHLB advances and other borrowings

     

    2,331

     

     

     

    2,709

     

     

    2,336

     

     

     

    3,106

     

     

     

    3,828

     

     

    5,862

     

     

     

     

     

     

     

    Net interest income

     

    116,133

     

     

     

    115,922

     

     

    110,036

     

     

     

     

     

     

     

    Provision for credit loss

     

    12,032

     

     

     

    838

     

     

    9,890

     

     

     

     

     

     

     

    Net interest income after provision for credit loss

     

    104,101

     

     

     

    115,084

     

     

    100,146

     

     

     

     

     

     

     

    Noninterest income:

     

     

     

     

     

    Refund transfer product fees

     

    410

     

     

     

    1,703

     

     

    422

     

    Refund advance fee income

     

    459

     

     

     

    229

     

     

    111

     

    Card and deposit fees

     

    29,066

     

     

     

    26,441

     

     

    30,750

     

    Rental income

     

    13,708

     

     

     

    13,199

     

     

    13,459

     

    (Loss) on sale of securities

     

    (15,671

    )

     

     

    —

     

     

    —

     

    Gain on divestitures

     

    16,404

     

     

     

    —

     

     

    —

     

    Gain (loss) on sale of loans and leases

     

    4,378

     

     

     

    2,829

     

     

    (31

    )

    Gain on sale of other

     

    987

     

     

     

    630

     

     

    2,871

     

    Other income

     

    7,637

     

     

     

    6,979

     

     

    5,179

     

    Total noninterest income

     

    57,378

     

     

     

    52,010

     

     

    52,761

     

     

     

     

     

     

     

    Noninterest expense:

     

     

     

     

     

    Compensation and benefits

     

    49,292

     

     

     

    52,298

     

     

    46,652

     

    Refund transfer product expense

     

    108

     

     

     

    168

     

     

    192

     

    Refund advance expense

     

    34

     

     

     

    20

     

     

    30

     

    Card processing

     

    33,314

     

     

     

    33,877

     

     

    34,584

     

    Occupancy and equipment expense

     

    9,706

     

     

     

    9,376

     

     

    8,848

     

    Operating lease equipment depreciation

     

    11,426

     

     

     

    10,445

     

     

    10,423

     

    Legal and consulting

     

    5,225

     

     

     

    8,414

     

     

    4,892

     

    Intangible amortization

     

    812

     

     

     

    924

     

     

    984

     

    Other expense

     

    13,642

     

     

     

    14,348

     

     

    12,669

     

    Total noninterest expense

     

    123,559

     

     

     

    129,870

     

     

    119,274

     

     

     

     

     

     

     

    Income before income tax expense

     

    37,920

     

     

     

    37,224

     

     

    33,633

     

     

     

     

     

     

     

    Income tax expense (benefit)

     

    6,294

     

     

     

    3,052

     

     

    5,719

     

     

     

     

     

     

     

    Net income before noncontrolling interest

     

    31,626

     

     

     

    34,172

     

     

    27,914

     

    Net income attributable to noncontrolling interest

     

    199

     

     

     

    575

     

     

    257

     

    Net income attributable to parent

    $

    31,427

     

     

    $

    33,597

     

    $

    27,657

     

     

     

     

     

     

     

    Less: Allocation of Earnings to participating securities(1)

     

    130

     

     

     

    348

     

     

    220

     

    Net income attributable to common shareholders(1)

     

    31,297

     

     

     

    33,249

     

     

    27,437

     

    Earnings per common share:

     

     

     

     

     

    Basic

    $

    1.29

     

     

    $

    1.35

     

    $

    1.06

     

    Diluted

    $

    1.29

     

     

    $

    1.35

     

    $

    1.06

     

    Shares used in computing earnings per common share:

     

     

     

     

     

    Basic

     

    24,221,697

     

     

     

    24,676,329

     

     

    25,776,845

     

    Diluted

     

    24,280,371

     

     

     

    24,715,021

     

     

    25,801,538

     

    (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 December 31,

    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

    $

    239,614

     

    $

    2,258

     

    3.74

    %

     

    $

    337,975

     

    $

    4,103

     

     

    4.83

    %

    Mortgage-backed securities

     

    1,309,926

     

     

    8,986

     

    2.72

    %

     

     

    1,486,854

     

     

    10,049

     

     

    2.69

    %

    Tax-exempt investment securities

     

    120,707

     

     

    845

     

    3.52

    %

     

     

    136,470

     

     

    930

     

     

    3.43

    %

    Asset-backed securities

     

    188,163

     

     

    2,604

     

    5.49

    %

     

     

    250,172

     

     

    3,565

     

     

    5.67

    %

    Other investment securities

     

    234,087

     

     

    1,815

     

    3.07

    %

     

     

    284,625

     

     

    2,288

     

     

    3.20

    %

    Total investments

     

    1,852,883

     

     

    14,250

     

    3.10

    %

     

     

    2,158,121

     

     

    16,832

     

     

    3.15

    %

    Commercial finance

     

    3,686,450

     

     

    77,430

     

    8.33

    %

     

     

    3,762,910

     

     

    75,345

     

     

    7.97

    %

    Consumer finance

     

    316,402

     

     

    10,405

     

    13.05

    %

     

     

    362,935

     

     

    10,585

     

     

    11.60

    %

    Tax services

     

    36,785

     

     

    132

     

    1.43

    %

     

     

    28,050

     

     

    (11

    )

     

    (0.16

    )%

    Warehouse finance

     

    603,824

     

     

    14,764

     

    9.70

    %

     

     

    381,931

     

     

    9,044

     

     

    9.42

    %

    Total loans and leases

     

    4,643,461

     

     

    102,731

     

    8.78

    %

     

     

    4,535,826

     

     

    94,963

     

     

    8.33

    %

    Total interest-earning assets

    $

    6,735,958

     

    $

    119,239

     

    7.04

    %

     

    $

    7,031,922

     

    $

    115,898

     

     

    6.57

    %

    Noninterest-earning assets

     

    649,450

     

     

     

     

     

     

    543,418

     

     

     

     

    Total assets

    $

    7,385,408

     

     

     

     

     

    $

    7,575,340

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Interest-bearing liabilities:

     

     

     

     

     

     

     

     

     

     

     

    Interest-bearing checking

    $

    685

     

    $

    —

     

    0.21

    %

     

    $

    426

     

    $

    —

     

     

    0.34

    %

    Savings

     

    45,469

     

     

    3

     

    0.03

    %

     

     

    54,783

     

     

    6

     

     

    0.04

    %

    Money markets

     

    180,104

     

     

    385

     

    0.85

    %

     

     

    183,255

     

     

    576

     

     

    1.25

    %

    Time deposits

     

    4,208

     

     

    3

     

    0.25

    %

     

     

    5,517

     

     

    4

     

     

    0.25

    %

    Wholesale deposits

     

    26,892

     

     

    384

     

    5.67

    %

     

     

    211,281

     

     

    2,940

     

     

    5.54

    %

    Total interest-bearing deposits (a)

     

    257,358

     

     

    775

     

    1.19

    %

     

     

    455,262

     

     

    3,526

     

     

    3.08

    %

    Overnight fed funds purchased

     

    131,337

     

     

    1,670

     

    5.05

    %

     

     

    117,153

     

     

    1,656

     

     

    5.62

    %

    Subordinated debentures

     

    19,702

     

     

    355

     

    7.14

    %

     

     

    19,600

     

     

    357

     

     

    7.24

    %

    Other borrowings

     

    13,661

     

     

    306

     

    8.89

    %

     

     

    14,178

     

     

    323

     

     

    9.07

    %

    Total borrowings

     

    164,700

     

     

    2,331

     

    5.62

    %

     

     

    150,931

     

     

    2,336

     

     

    6.16

    %

    Total interest-bearing liabilities

     

    422,058

     

     

    3,106

     

    2.92

    %

     

     

    606,193

     

     

    5,862

     

     

    3.85

    %

    Noninterest-bearing deposits (b)

     

    5,823,877

     

     

    —

     

    —

    %

     

     

    6,102,928

     

     

    —

     

     

    —

    %

    Total deposits and interest-bearing liabilities

    $

    6,245,935

     

    $

    3,106

     

    0.20

    %

     

    $

    6,709,121

     

    $

    5,862

     

     

    0.35

    %

    Other noninterest-bearing liabilities

     

    335,743

     

     

     

     

     

     

    210,468

     

     

     

     

    Total liabilities

     

    6,581,678

     

     

     

     

     

     

    6,919,589

     

     

     

     

    Shareholders' equity

     

    803,730

     

     

     

     

     

     

    655,751

     

     

     

     

    Total liabilities and shareholders' equity

    $

    7,385,408

     

     

     

     

     

    $

    7,575,340

     

     

     

     

    Net interest income and net interest rate spread including noninterest-bearing deposits

     

     

    $

    116,133

     

    6.84

    %

     

     

     

    $

    110,036

     

     

    6.22

    %

     

     

     

     

     

     

     

     

     

     

     

     

    Net interest margin

     

     

     

     

    6.84

    %

     

     

     

     

     

    6.23

    %

    Tax-equivalent effect

     

     

     

     

    0.01

    %

     

     

     

     

     

    0.01

    %

    Net interest margin, tax-equivalent(2)

     

     

     

     

    6.85

    %

     

     

     

     

     

    6.24

    %

     

     

     

     

     

     

     

     

     

     

     

     

    Total cost of deposits (a+b)

     

    6,081,235

     

     

    775

     

    0.05

    %

     

     

    6,558,190

     

     

    3,526

     

     

    0.21

    %

    (1)

    Tax rate used to arrive at the TEY for the three months ended December 31, 2024 and 2023 was 21%.

    (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

    December 31,

    2024

     

    September 30,

    2024

     

    June 30,

    2024

     

    March 31,

    2024

     

    December 31,

    2023

    Equity to total assets

     

    10.19

    %

     

     

    11.12

    %

     

     

    10.16

    %

     

     

    9.94

    %

     

     

    9.20

    %

    Book value per common share outstanding

    $

    32.19

     

     

    $

    33.79

     

     

    $

    30.51

     

     

    $

    29.14

     

     

    $

    28.06

     

    Tangible book value per common share outstanding

    $

    19.21

     

     

    $

    20.67

     

     

    $

    17.47

     

     

    $

    16.21

     

     

    $

    15.39

     

    Common shares outstanding

     

    24,119,416

     

     

     

    24,847,353

     

     

     

    25,085,230

     

     

     

    25,377,986

     

     

     

    25,988,230

     

    Nonperforming assets to total assets

     

    0.49

    %

     

     

    0.57

    %

     

     

    0.61

    %

     

     

    0.50

    %

     

     

    0.53

    %

    Nonperforming loans and leases to total loans and leases

     

    0.76

    %

     

     

    0.87

    %

     

     

    0.96

    %

     

     

    0.78

    %

     

     

    0.88

    %

    Net interest margin

     

    6.84

    %

     

     

    6.66

    %

     

     

    6.56

    %

     

     

    6.23

    %

     

     

    6.23

    %

    Net interest margin, tax-equivalent

     

    6.85

    %

     

     

    6.67

    %

     

     

    6.57

    %

     

     

    6.24

    %

     

     

    6.24

    %

    Return on average assets

     

    1.69

    %

     

     

    1.79

    %

     

     

    2.28

    %

     

     

    3.17

    %

     

     

    1.46

    %

    Return on average equity

     

    15.51

    %

     

     

    16.80

    %

     

     

    22.62

    %

     

     

    35.72

    %

     

     

    16.87

    %

    Return on average tangible equity

     

    25.65

    %

     

     

    28.40

    %

     

     

    40.59

    %

     

     

    64.92

    %

     

     

    33.95

    %

    Full-time equivalent employees

     

    1,170

     

     

     

    1,241

     

     

     

    1,232

     

     

     

    1,204

     

     

     

    1,218

     

    Non-GAAP Reconciliations

       

    Net Interest Margin and Cost of Deposits

    At and For the Three Months Ended

    (Dollars in thousands)

    December 31, 2024

    September 30, 2024

    December 31, 2023

    Average interest earning assets

    $

    6,735,958

     

    $

    6,925,315

     

    $

    7,031,922

     

    Net interest income

    $

    116,133

     

    $

    115,922

     

    $

    110,036

     

    Net interest margin

     

    6.84

    %

     

    6.66

    %

     

    6.23

    %

    Quarterly average total deposits

    $

    6,081,235

     

    $

    6,199,271

     

    $

    6,558,190

     

    Deposit interest expense

    $

    775

     

    $

    1,119

     

    $

    3,526

     

    Cost of deposits

     

    0.05

    %

     

    0.07

    %

     

    0.21

    %

     

     

     

     

    Adjusted Net Interest Margin with contractual, rate-related card expenses associated with deposits on the Company's balance sheet

     

     

     

    Average interest earning assets

    $

    6,735,958

     

    $

    6,925,315

     

    $

    7,031,922

     

    Net interest income

     

    116,133

     

     

    115,922

     

     

    110,036

     

    Less: Contractual, rate-related processing expense

     

    24,241

     

     

    24,631

     

     

    25,891

     

    Adjusted net interest income

    $

    91,892

     

    $

    91,291

     

    $

    84,145

     

    Adjusted net interest margin

     

    5.41

    %

     

    5.24

    %

     

    4.76

    %

    Average total deposits

    $

    6,081,235

     

    $

    6,199,271

     

    $

    6,558,190

     

    Deposit interest expense

     

    775

     

     

    1,119

     

     

    3,526

     

    Add: Contractual, rate-related processing expense

     

    24,241

     

     

    24,631

     

     

    25,891

     

    Adjusted deposit expense

    $

    25,016

     

    $

    25,750

     

    $

    29,417

     

    Adjusted cost of deposits

     

    1.63

    %

     

    1.65

    %

     

    1.78

    %

     

    View source version on businesswire.com: https://www.businesswire.com/news/home/20250121901856/en/

    Investor Relations Contact

    Darby Schoenfeld, CPA

    SVP, Chief of Staff & Investor Relations

    877-497-7497

    [email protected]

    Media Relations Contact

    [email protected]

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      Each project will provide clean energy to distinct clean energy subscription programs in Sonoma, Mendocino, and Fresno counties Renewable Properties, a developer and investor in small-scale utility, community solar, energy storage, and electric vehicle infrastructure projects, has broken ground on three new solar projects in California. Scheduled for completion in 2025, the projects will deliver over 17 MWdc of clean, renewable power to customers through programs offered by Sonoma Clean Power (SCP) and Pacific Gas and Electric (PG&E). Optus Bank, Pathward®, N.A., and BridgePeak Energy Capital are providing two construction loans to fund the three California projects. The first loan, total

      5/5/25 4:07:00 PM ET
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    • Pathward Financial, Inc. Announces Results for 2025 Fiscal Second Quarter

      Pathward Financial, Inc. ("Pathward Financial" or the "Company") (NASDAQ:CASH) reported net income of $74.3 million, or $3.11 per share, for the three months ended March 31, 2025, compared to net income of $65.3 million, or $2.56 per share, for the three months ended March 31, 2024. CEO Brett Pharr said, "At the halfway point for the fiscal year, our businesses are healthy, and we are optimistic about the future. We have made significant progress toward our goals thanks in large part to the successful execution on our balance sheet strategy, which is allowing us to generate revenue above our asset size and means that we do not need to grow our balance sheet to grow revenues. This is eviden

      4/22/25 4:10:00 PM ET
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    • Amendment: SEC Form SC 13G/A filed by Pathward Financial Inc.

      SC 13G/A - PATHWARD FINANCIAL, INC. (0000907471) (Subject)

      11/12/24 5:59:00 PM ET
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    • Amendment: SEC Form SC 13G/A filed by Pathward Financial Inc.

      SC 13G/A - PATHWARD FINANCIAL, INC. (0000907471) (Subject)

      11/12/24 10:34:15 AM ET
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    • SEC Form SC 13G filed by Pathward Financial Inc.

      SC 13G - PATHWARD FINANCIAL, INC. (0000907471) (Subject)

      10/17/24 9:57:53 AM ET
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    • Pathward Financial Inc. filed SEC Form 8-K: Results of Operations and Financial Condition, Regulation FD Disclosure, Financial Statements and Exhibits

      8-K - PATHWARD FINANCIAL, INC. (0000907471) (Filer)

      4/22/25 4:10:49 PM ET
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    • Pathward Financial Inc. filed SEC Form 8-K: Other Events, Financial Statements and Exhibits

      8-K - PATHWARD FINANCIAL, INC. (0000907471) (Filer)

      2/27/25 9:00:51 AM ET
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    • Pathward Financial Inc. filed SEC Form 8-K: Submission of Matters to a Vote of Security Holders, Financial Statements and Exhibits

      8-K - PATHWARD FINANCIAL, INC. (0000907471) (Filer)

      2/26/25 4:15:18 PM ET
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    • Raymond James resumed coverage on Pathward Financial

      Raymond James resumed coverage of Pathward Financial with a rating of Mkt Perform

      1/26/23 7:48:48 AM ET
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    • Pathward Financial downgraded by Keefe Bruyette with a new price target

      Keefe Bruyette downgraded Pathward Financial from Outperform to Mkt Perform and set a new price target of $45.00 from $67.00 previously

      7/28/22 6:12:02 AM ET
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    • Meta Financial downgraded by Raymond James with a new price target

      Raymond James downgraded Meta Financial from Strong Buy to Outperform and set a new price target of $46.00 from $70.00 previously

      7/7/22 9:09:08 AM ET
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    • Pathward Appoints Anjana Berde as Executive Vice President and Chief People and Culture Officer

      Berde brings more than three decades of human resource experience to Pathward. Pathward Financial, Inc. (NASDAQ:CASH) through its subsidiary, Pathward®, N.A. ("Pathward" or "company"), a U.S.-based financial empowerment company driven by its purpose to power financial inclusion, announced that Anjana Berde has joined the company as the Executive Vice President and Chief People and Culture Officer. This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20250206832670/en/Anjana Berde joins Pathward as Executive Vice President and Chief People and Culture Officer. (Photo: Business Wire) In this role, she reports to Pathward CEO Brett Pharr

      2/6/25 4:13:00 PM ET
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    • MoneyLion Appoints Leading Bank Executive Brad Hanson as Director and Audit Committee Chair

      MoneyLion Inc. ("MoneyLion") (NYSE:ML), a digital ecosystem for consumer finance that empowers everyone to make their best financial decisions, today announced that its Board of Directors has elected Brad Hanson, formerly President and Chief Executive Officer of Pathward Financial, Inc. (f/k/a Meta Financial Group, Inc.) (NASDAQ:CASH), to its Board of Directors and as Chair of the Audit Committee, effective as of July 15. Hanson will fill the remaining term of former Audit Committee Chair Jeff Gary, who is stepping down from the Board of Directors. "We are thrilled to welcome Brad to MoneyLion's Board of Directors and as the Chair of the Audit Committee," said John Chrystal, Chair of Mone

      7/16/24 9:00:00 AM ET
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      Finance: Consumer Services
    • Pathward Appoints Neeraj Mehta To Board Of Directors

      Pathward Financial, Inc. (NASDAQ:CASH) and its subsidiary Pathward®, N.A., an industry leading financial empowerment company driven by its purpose to power financial inclusion, today announced that Neeraj Mehta has been appointed as an independent member of the Board of Directors, effective Feb. 27, 2024. Mehta will serve as a member of the Audit Committee and Governance, Nominating and Sustainability Committee of the Pathward Financial, Inc. and Pathward, N.A. boards. "Having held numerous leadership positions at multiple financial services companies, Neeraj has driven revenue for companies and large business lines and determined and directed strategy with measurable results. Neeraj brin

      2/28/24 4:10:00 PM ET
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    • Director Stork Kendall E sold $317,320 worth of shares (4,000 units at $79.33) (SEC Form 4)

      4 - PATHWARD FINANCIAL, INC. (0000907471) (Issuer)

      4/30/25 4:04:03 PM ET
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    • SVP, Chief Accounting Officer Warren Jennifer W. sold $129,976 worth of shares (1,667 units at $77.97), decreasing direct ownership by 25% to 5,019 units (SEC Form 4)

      4 - PATHWARD FINANCIAL, INC. (0000907471) (Issuer)

      4/29/25 4:17:57 PM ET
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    • Chief Executive Officer Pharr Brett L. sold $809,196 worth of shares (10,365 units at $78.07), decreasing direct ownership by 13% to 69,750 units (SEC Form 4)

      4 - PATHWARD FINANCIAL, INC. (0000907471) (Issuer)

      4/29/25 4:16:13 PM ET
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