Pathward Financial Reports $185.9 Million Net Income for Fiscal Year 2025

**Pathward Financial Reports Fiscal Year 2025 Results**

Pathward Financial, Inc., a bank holding company, reported net income attributable to the parent of $185.9 million, or $7.87 per diluted share, for the fiscal year ended September 30, 2025, compared to $183.2 million, or $7.20 per diluted share, for the prior fiscal year. The increase in net income was primarily driven by increases in noninterest income and net interest income, and a decrease in the provision for credit losses, partially offset by an increase in noninterest expense and income tax expense. Total revenue for fiscal year 2025 was $839.9 million, an increase of 5% compared to $797.4 million for the prior fiscal year.

Net interest income for fiscal year 2025 increased by 3% to $511.8 million from $497.8 million in the prior year, mainly attributable to an improved earning asset mix. The net interest margin (NIM) increased 33 basis points to 7.34% from 7.01% in the prior fiscal year. The provision for credit losses decreased to $56.8 million from $58.1 million in the prior year, primarily due to decreases in the consumer finance and tax services portfolios, partially offset by an increase in the commercial finance portfolio. Noninterest income increased by 10% to $328.1 million, driven by increases in secondary market revenue, gain on divestiture, total tax services product fees, and other income, partially offset by a loss on sale of investment securities and decreases in rental income, gain on sale of other, and card and deposit fees.

Key operational developments included a slight increase in total end-of-period deposits to $5.89 billion, with noninterest-bearing checking deposits comprising $5.62 billion of this total. Total gross loans and leases increased to $4.66 billion, with commercial finance loans representing the largest portion at $3.92 billion. The company completed the sale of its commercial insurance premium finance business on October 31, 2024, resulting in a gain of $15.0 million. As of September 30, 2025, the company had $326.0 million in deposits related to government stimulus funds.

Looking ahead, Pathward Financial faces challenges related to managing credit risk, interest rate risk, and regulatory compliance. The company has identified a material weakness in its internal control over financial reporting related to the accounting and financial reporting for certain consumer lending program agreements. Management is taking steps to remediate this weakness, but there is no guarantee that these efforts will be successful. The company's ability to attract and maintain deposits and the rates paid on these deposits will continue to be significantly affected by market conditions.