Business Wire | Oct 27, 2021 04:10PM EDT

Meta Financial Group, Inc.(r) Announces Results for Fourth Quarter and Fiscal Year 2021

Oct. 27, 2021

SIOUX FALLS, S.D.--(BUSINESS WIRE)--Oct. 27, 2021--Meta Financial Group, Inc.(r) (Nasdaq: CASH) ("Meta" or the "Company") reported net income of $15.9 million, or $0.50 per share, for the three months ended September 30, 2021, compared to net income of $13.2 million, or $0.38 per share, for the three months ended September 30, 2020. The Company reported record net income of $141.7 million, or $4.38 per share, for the fiscal year ended September 30, 2021, compared to net income of $104.7 million, or $2.94 per diluted share for the fiscal year ended September 30, 2020.

"MetaBank ended fiscal year 2021 on a strong note, as we made significant progress against our three key strategic initiatives, positioning the firm for continued improvement," said CEO Brett Pharr. "As we start the new fiscal year, our Banking-as-a-Service pipeline has never been stronger and we will continue to advance our mission of financial inclusion for all(r)."

"I also want to thank our previous CEO Brad Hanson for his contributions over nearly 20 years. His efforts, together with those of our team, built the leadership position that Meta enjoys today," Pharr added.

"We achieved record earnings this past fiscal year that generated excess capital for our shareholders, as reflected in the Board's confidence in authorizing the new share repurchase program we announced last month," said Executive Vice President and CFO Glen Herrick. "We have a balanced approach to capital deployment and will continue to evaluate strategies that create shareholder value."

Business Development Highlights for the 2021 Fiscal Fourth Quarter and Full Fiscal Year 2021

* Named the Visa card issuer, in conjunction with Blackhawk Network, for the Excluded Workers Fund, a New York State Department of Labor program that provides one-time payments to certain New Yorkers who lost income due to COVID-19. * Recognized a net unrealized gain of $4.1 million on a prior investment in MoneyLion Inc. ("MoneyLion") following the completion of its de-SPAC'ing process and listing on the New York Stock Exchange on September 22, 2021. * Expanded our renewable energy financing, originating $101.1 million for the fiscal year 2021, resulting in $26.5 million in total net investment tax credits. * Announced a new share repurchase program and during the 2021 fiscal fourth quarter repurchased 234,297 shares, at an average price of $51.18, reflecting the momentum of the business and confidence in the Company's strategy and growth trajectory. An additional 636,100 shares were purchased in October 2021 through October 22, 2021. * Bradley C. Hanson, President and Chief Executive Officer of the Company retired from his positions at Meta Financial and MetaBank. He will remain on the Company's Board until the next annual stockholders' meeting, expected to take place in February 2022. He also will serve as a Strategic Advisor to Meta on industry and partner relations until the end of 2022. The Board appointed Brett L. Pharr as Chief Executive Officer and Anthony M. Sharett as President of Meta Financial Group and MetaBank effective October 1, 2021. For additional information, please see the associated press release from September 7, 2021. * Subsequent to September 30, 2021, MetaBank sold $30.2 million in community banking loans to Central Bank and has agreements in place to sell another approximately $161.0 million. Following the sale, the legacy community bank loan portfolio will be less than $8 million. The Company expects community bank balances to be at $0 at the end of the first fiscal quarter of 2022. Included in the sales, are approximately $108.0 million of substandard and doubtful loans, of which $14.9 million are nonaccrual loans, as of September 30, 2021, representing 39% of MetaBank's substandard and doubtful loan and lease balances and 44% of our nonaccrual balances.

Financial Highlights for the 2021 Fiscal Fourth Quarter

* Total revenue for the fourth quarter was $120.2 million, an increase of $14.9 million compared to the same quarter in fiscal 2020 primarily driven by higher net interest income, payments fee income and $4.1 million in other income related to the MoneyLion valuation. * Operating efficiency ratio improved 146 basis points to 62.5% at September 30, 2021 compared to 64.0% at September 30, 2020. See non-GAAP reconciliation table below. * Net interest income for the fourth quarter was $70.7 million, an increase of $6.2 million compared to $64.5 million in the fourth quarter last year. * Net interest margin ("NIM") improved to 4.35% for the fourth quarter from 3.77% during the same period of last year, chiefly due to the decrease in cash associated with the Company's participation in the Economic Impact Program ("EIP") program, as well as an increase in commercial and warehouse finance loans and leases. * Total gross loans and leases at September 30, 2021 increased $293.7 million, to $3.61 billion, or 9%, compared to September 30, 2020 and increased $112.6 million, or 3%, when compared to June 30, 2021. The increase was primarily driven by growth in commercial finance, warehouse finance and consumer finance loans partially offset by a decrease in community bank loans, which was driven by a loan sale of $75.1 million during the quarter.

Net Interest Income

Net interest income for the fourth quarter of fiscal 2021 was $70.7 million, an increase of 10% from the same quarter in fiscal 2020. The increase was mainly attributable to the continued optimization of our earning asset and liability mix, along with increased loan balances.

The fourth quarter average outstanding balance of loans and leases increased $109.3 million compared to the prior year quarter, primarily due to increases in the commercial finance, warehouse finance and consumer finance loan and lease portfolios, partially offset by a decrease in the retained community bank portfolio. The Company's average interest-earning assets for the fourth quarter decreased by $367.8 million to $6.44 billion compared with the same quarter in fiscal 2020, primarily due to the decrease in cash and fed funds sold, partially offset by growth in total investments and total loans and leases.

Fiscal 2021 fourth quarter NIM increased to 4.35% from 3.77% in the fourth quarter of last year. The overall reported tax-equivalent yield ("TEY") on average earning asset yields increased 43 basis points to 4.45% compared to the prior year quarter, primarily driven by a reduction in low-yielding cash held at the Federal Reserve. The TEY on the securities portfolio was 1.50% compared to 1.78% for the comparable period last year.

The Company's cost of funds for all deposits and borrowings averaged 0.09% during the fiscal 2021 fourth quarter, compared to 0.23% during the prior year quarter, primarily driven by a reduction in wholesale deposit balances. The Company's overall cost of deposits was 0.01% in the fiscal fourth quarter of 2021, compared to 0.12% in the same quarter last year.

Noninterest Income

Fiscal 2021 fourth quarter noninterest income increased to $49.5 million, compared to $40.8 million for the same period of the prior year. The significant increase was primarily driven by payments fee income, a net unrealized gain of $4.1 million in the MoneyLion investment and $1.5 million of other income on a student loan insurance recovery, which were partially offset by a net loss on a sale of community bank loans in the quarter of $1.8 million. The payments fee income was aided by an increase in activity related to government stimulus programs.

Noninterest Expense

Noninterest expense increased 17% to $93.6 million for the fiscal 2021 fourth quarter, from $80.3 million for the same quarter last year. The increase in expense was primarily driven by $9.0 million in one-time technology and product investments. CEO transition expenses of $1.3 million related to accelerated vesting of CEO shares and associated professional expenses also contributed to the year-over-year increase.

Income Tax Expense

The Company recorded income tax expense of $1.1 million, representing an effective tax rate of 6.2%, for the fiscal 2021 fourth quarter, compared to $1.8 million, representing an effective tax rate of 11.2%, for the fourth quarter last year.

The Company originated $29.1 million in solar leases during the fiscal 2021 fourth quarter, compared to $41.1 million in last year's fourth quarter. Investment tax credits related to solar leases are recognized ratably based on income throughout each fiscal year. The timing and impact of future solar tax credits are expected to vary from period to period, and Meta intends to undertake only those tax credit opportunities that meet the Company's underwriting and return criteria.

Investments, Loans and Leases

September 30, June 30, March 31, December 31, September 30, 2021 2021 2021 2020 2020

Total $ 1,921,568 $ 1,981,852 $ 1,552,892 $ 1,309,452 $ 1,360,712 investments



Loans held for sale

Consumercredit 23,111 12,582 6,233 234 962 products

SBA/USDA 33,083 57,208 61,402 32,983 52,542

Community - 18,115 - 100,442 130,073 Bank

Total loansheld for 56,194 87,905 67,635 133,659 183,577 sale



Term 961,019 920,279 891,414 881,306 805,323 lending

Asset based 300,225 263,237 248,735 242,298 182,419 lending

Factoring 363,670 320,629 277,612 275,650 281,173

Lease 266,050 282,940 308,169 283,722 281,084 financing

Insurancepremium 428,867 417,652 344,841 338,227 337,940 finance

SBA/USDA 247,756 263,709 331,917 300,707 318,387

Othercommercial 157,908 118,081 103,234 101,209 101,658 finance

Commercial 2,725,495 2,586,527 2,505,922 2,423,119 2,307,984 Finance

Consumercredit 129,251 105,440 104,842 88,595 89,809 products

Otherconsumer 123,606 122,316 130,822 162,423 134,342 finance

Consumer 252,857 227,756 235,664 251,018 224,151 Finance

Tax 10,405 41,268 225,921 92,548 3,066 Services

Warehouse 419,926 335,704 332,456 318,937 293,375 Finance

Community 199,132 303,984 348,065 353,942 485,564 Banking

Total grossloans and 3,607,815 3,495,239 3,648,028 3,439,564 3,314,140 leases

Allowancefor credit (68,281 ) (91,208 ) (98,892 ) (72,389 ) (56,188 )losses

Netdeferredloan and 1,748 1,431 9,503 9,111 8,625 leaseoriginationfees

Total loansand leases, $ 3,541,282 $ 3,405,462 $ 3,558,639 $ 3,376,286 $ 3,266,577 net ofallowance

The Company's investment security balances at September 30, 2021 totaled $1.92 billion, as compared to $1.98 billion at June 30, 2021 and $1.36 billion at September 30, 2020.

Total gross loans and leases totaled $3.61 billion at September 30, 2021, as compared to $3.50 billion at June 30, 2021 and $3.31 billion and as compared to September 30, 2020. The primary drivers for the increase on a prior quarter basis were commercial finance, consumer credit, and warehouse finance loans, partially offset by the decrease in community bank and tax service loans.

At September 30, 2021, commercial finance loans, which comprised 76% of the Company's gross loan and lease portfolio, totaled $2.73 billion, reflecting growth of $139.0 million, or 5%, from June 30, 2021.

As of September 30, 2021, the Company had 370 loans outstanding with total loan balances of $96.0 million originated as part of the Paycheck Protection Program ("PPP"), compared with 458 loans outstanding with total loan balances of $143.3 million for the quarter ended June 30, 2021. In total, 69% of the PPP loan balances were forgiven through September 30, 2021.

Community bank loans held for investment totaled $199.1 million as of September 30, 2021, decreasing as compared to $304.0 million at June 30, 2021 and $485.6 million at September 30, 2020. The Company sold additional loans from the retained Community Bank portfolio in the amount of $75.1 million during the fiscal 2021 fourth quarter, which resulted in a net loss on sale of $1.8 million for the quarter.

Asset Quality

The Company's allowance for credit losses ("ACL") totaled $68.3 million at September 30, 2021, a decrease compared to $91.2 million at June 30, 2021 and an increase compared to $56.2 million at September 30, 2020. The decrease in the ACL at September 30, 2021, when compared to June 30, 2021, was primarily due to a $24.3 million decrease in the allowance for seasonal tax services loan portfolio as we recorded season-end charge-downs, a $1.3 million decrease in consumer lending and a $1.0 million decrease in the retained community banking portfolio, partially offset by a $4.3 million increase in commercial finance and $0.1 million increase in warehouse finance.

The $12.1 million year-over-year increase in the ACL was primarily driven by an $18.3 million increase within the commercial finance portfolio and a $3.7 million increase in the consumer lending portfolio. These increases were driven by the year-over-year loan growth and the adoption of the current expected credit losses ("CECL") accounting standard, which required a day one entry to increase the allowance for credit losses in the amount of $12.8 million effective October 1, 2020. The increases noted above were partially offset by a $10.0 million reduction within the retained community banking portfolio, which decreased year-over-year.

The following table presents the Company's allowance for credit losses as a percentage of its total loans and leases.

As of the Period Ended

September June March December October September(Unaudited) 30, 30, 31, 31, 1, 30, 2021 2021 2021 2020 2020(1) 2020



Commercial finance 1.77 % 1.73 % 1.77 % 1.88 % 1.85 % 1.30 %

Consumer finance 2.91 % 3.80 % 4.70 % 4.39 % 4.31 % 1.64 %

Tax services 0.02 % 58.99 % 12.90 % 1.53 % 0.06 % 0.06 %

Warehouse finance 0.10 % 0.10 % 0.10 % 0.10 % 0.10 % 0.10 %

Community bank 6.16 % 4.36 % 4.03 % 4.01 % 3.37 % 4.59 %

Total loans and 1.89 % 2.61 % 2.71 % 2.10 % 2.08 % 1.70 %leases

(1) Represents the Company's ACL coverage ratio upon the adoption of the Accounting Standards Update 2016-13 using September 30, 2020 loan and lease and allowance balances plus the CECL allowance adjustment.

The Company's ACL as a percentage of total loans and leases decreased to 1.89% at September 30, 2021 from 2.61% at June 30, 2021. The decrease in the total loans and leases coverage ratio reflected a seasonal reduction in the allowance for the tax services loan portfolios along with a reduction in specific reserves. When excluding the seasonal tax services loans, the ACL as a percentage of total loans and leases decreased to 1.90% at September 30, 2021 from 1.94% at June 30, 2021. The coverage ratio for the commercial finance loan category remained relatively similar to the June 30, 2021 quarter. The consumer finance coverage decreased primarily due to an improved overall macroeconomic outlook and the community bank coverage ratio increased as the majority of the remaining loans are in pandemic stressed industries, such as hospitality and movie theaters. The Company expects to continue to diligently monitor the allowance for credit losses and adjust as necessary in future periods to maintain an appropriate and supportable level.

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

(Unaudited) Three Months Ended Year Ended

September June 30, September September September 30, 2021 2021 30, 2020 30, 2021 30, 2020

(Dollars in thousands)

Beginning balance $ 91,208 $ 98,892 $ 65,747 $ 56,188 $ 29,149

Adoption of CECL - - - 12,773 - accounting standard

Provision - tax 457 4,685 1,599 33,276 22,006 services loans

Provision - all other 8,368 (36 ) 7,381 16,663 42,770 loans and leases

Charge-offs - tax (24,849 ) (9,505 ) (13,037 ) (34,354 ) (22,834 )services loans

Charge-offs - all (7,635 ) (5,360 ) (6,015 ) (22,920 ) (18,927 )other loans and leases

Recoveries - tax 51 17 3 1,078 830 services loans

Recoveries - all other 681 2,515 510 5,577 3,194 loans and leases

Ending balance $ 68,281 $ 91,208 $ 56,188 $ 68,281 $ 56,188

Provision for credit losses was $8.8 million for the quarter ended September 30, 2021, compared to $9.0 million for the comparable period in the prior fiscal year. Provision for credit losses was $49.8 million for fiscal year ended September 30, 2021, compared to $64.8 million for the comparable period in the prior fiscal year. The fiscal year-over-year decrease in provision was largely attributable to the ACL build in the prior year stemming from the COVID-19 pandemic. Net charge-offs were $31.8 million for the quarter ended September 30, 2021, compared to $18.5 million for the quarter ended September 30, 2020. The majority of the net charge-offs for the quarter were attributable to seasonal tax-related loan products.

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

As ofSeptember Accruing and Nonaccruing Loans and Leases Nonperforming Loans and Leases30, 2021

60-89 > 89(Dollars 30-59 Days > 89 Total Total Loans Days Non-accrualin Days Past Days Past Current and Leases Past Due balance TotalThousands) Past Due Due Past Due Due Receivable and Accruing



Commercial $ 18,269 $ 7,388 $ 15,439 $ 41,096 $ 2,684,399 $ 2,725,495 $ 12,489 $ 19,330 $ 31,819finance

Consumer 1,676 812 1,236 3,724 249,133 252,857 1,160 - 1,160finance

Tax - - 7,962 7,962 2,443 10,405 7,962 - 7,962services

Warehouse - - - - 419,926 419,926 - - -finance

Community - - - - 199,132 199,132 - 14,915 14,915banking

Totalloans andleases 19,945 8,200 24,637 52,782 3,555,033 3,607,815 21,611 34,245 55,856held forinvestment

As of June 30, 2021

Accruing and Nonaccruing Loans and Leases

Nonperforming Loans and Leases

(Dollars in Thousands)

30-59 DaysPast 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

Non-accrual balance

Total

Commercial finance

$

22,117

$

10,650

$

8,844

$

41,611

$

2,544,916

$

2,586,527

$

4,350

$

17,315

$

21,665

Consumer finance

843

1,009

525

2,377

225,379

227,756

469

-

469

Tax services

-

40,958

-

40,958

310

41,268

-

-

-

Warehouse finance

-

-

-

-

335,704

335,704

-

-

-

Community banking

62

-

1,769

1,831

302,153

303,984

-

19,773

19,773

Total loans and leases held for investment

23,022

52,617

11,138

86,777

3,408,462

3,495,239

4,819

37,088

41,907

The Company's nonperforming assets at September 30, 2021 were $61.8 million, representing 0.92% of total assets, compared to $45.1 million, or 0.64% of total assets at June 30, 2021 and $48.0 million, or 0.79% of total assets at September 30, 2020. The changes in the nonperforming assets as a percentage of total assets at September 30, 2021 were driven in large part by a $10.2 million increase in nonperforming assets in the commercial finance portfolio which is primarily due to an administrative timing item that management believes is not a credit concern, and an increase related to the seasonal tax services portfolio that is also timing and not credit-related, partially offset by a decrease in nonperforming assets in the community bank portfolio when compared to both the linked-quarter and the prior year.

The Company's nonperforming loans and leases at September 30, 2021, were $55.9 million, representing 1.52% of total gross loans and leases, compared to $41.9 million, or 1.17% of total gross loans and leases at June 30, 2021 and $34.0 million, or 0.97% of total gross loans and leases at September 30, 2020. The increases are related to the aforementioned non-credit related increases in nonperforming assets in the commercial finance and tax services portfolios.

Loan and lease balances that were within their active deferment period decreased to $39.1 million at September 30, 2021 from $41.5 million at June 30, 2021.

Meta has revised its credit administration policies and reviewed its loan portfolio to better align with OCC guidance for national banks, a process that began during the quarter ending June 30, 2021 and was substantially completed as of September 30, 2021. These credit policy revisions had an impact on our loan and lease risk ratings, resulting in downgrades of certain credits in several categories. Our loan and collateral management practices have proven effective in managing losses during previous economic cycles; and while we expect this process will result in setting a new baseline for portfolio metrics going forward, it does not indicate a deterioration in our portfolio's expected performance. Further, these changes do not reflect an increase in credit risk for past or future periods and thus we do not anticipate any increase in losses as a result of these one-time administrative adjustments to these credits' risk ratings.

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.

As of June Accruing and Nonaccruing Loans and Leases Nonperforming Loans and Leases30, 2021

> 89 > 89(Dollars 30-59 60-89 Days Total Total Loans Days Non-accrualin Days Days Past Current and Leases Past Due balance TotalThousands) Past Due Past Due Past Due Due Receivable and Accruing



Commercial $ 22,117 $ 10,650 $ 8,844 $ 41,611 $ 2,544,916 $ 2,586,527 $ 4,350 $ 17,315 $ 21,665finance

Consumer 843 1,009 525 2,377 225,379 227,756 469 - 469finance

Tax - 40,958 - 40,958 310 41,268 - - -services

Warehouse - - - - 335,704 335,704 - - -finance

Community 62 - 1,769 1,831 302,153 303,984 - 19,773 19,773banking

Totalloans andleases 23,022 52,617 11,138 86,777 3,408,462 3,495,239 4,819 37,088 41,907held forinvestment

The Company's nonperforming assets at September 30, 2021 were $61.8 million, representing 0.92% of total assets, compared to $45.1 million, or 0.64% of total assets at June 30, 2021 and $48.0 million, or 0.79% of total assets at September 30, 2020. The changes in the nonperforming assets as a percentage of total assets at September 30, 2021 were driven in large part by a $10.2 million increase in nonperforming assets in the commercial finance portfolio which is primarily due to an administrative timing item that management believes is not a credit concern, and an increase related to the seasonal tax services portfolio that is also timing and not credit-related, partially offset by a decrease in nonperforming assets in the community bank portfolio when compared to both the linked-quarter and the prior year.

The Company's nonperforming loans and leases at September 30, 2021, were $55.9 million, representing 1.52% of total gross loans and leases, compared to $41.9 million, or 1.17% of total gross loans and leases at June 30, 2021 and $34.0 million, or 0.97% of total gross loans and leases at September 30, 2020. The increases are related to the aforementioned non-credit related increases in nonperforming assets in the commercial finance and tax services portfolios.

Loan and lease balances that were within their active deferment period decreased to $39.1 million at September 30, 2021 from $41.5 million at June 30, 2021.

Meta has revised its credit administration policies and reviewed its loan portfolio to better align with OCC guidance for national banks, a process that began during the quarter ending June 30, 2021 and was substantially completed as of September 30, 2021. These credit policy revisions had an impact on our loan and lease risk ratings, resulting in downgrades of certain credits in several categories. Our loan and collateral management practices have proven effective in managing losses during previous economic cycles; and while we expect this process will result in setting a new baseline for portfolio metrics going forward, it does not indicate a deterioration in our portfolio's expected performance. Further, these changes do not reflect an increase in credit risk for past or future periods and thus we do not anticipate any increase in losses as a result of these one-time administrative adjustments to these credits' risk ratings.

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 Pass Watch Special Substandard Doubtful TotalClassification Mention

As ofSeptember 30, (Dollars in Thousands)2021

Commercial $ 2,039,324 $ 364,713 $ 170,527 $ 144,414 $ 6,517 $ 2,725,495finance

Warehouse 419,926 - - - - 419,926finance

Community 10,314 27,121 35,916 120,238 5,543 199,132banking

Total Loans $ 2,469,564 $ 391,834 $ 206,443 $ 264,652 $ 12,060 $ 3,344,553and Leases

Asset Classification

Pass

Watch

Special Mention

Substandard

Doubtful

Total

As of June 30, 2021

(Dollars in Thousands)

Commercial finance

$

2,315,437

$

133,124

$

55,869

$

74,930

$

7,166

$

2,586,526

Warehouse finance

335,704

-

-

-

-

335,704

Community banking

195,721

33,494

14,574

60,196

-

303,985

Total Loans and Leases

$

2,846,862

$

166,618

$

70,443

$

135,126

$

7,166

$

3,226,215

Deposits, Borrowings and Other Liabilities

Total average deposits for the fiscal 2021 fourth quarter decreased by $389.7 million to $6.08 billion compared to the same period in fiscal 2020, primarily due to a reduction in wholesale deposits. Average wholesale deposits decreased $485.3 million, while noninterest-bearing deposits decreased $11.1 million, for the fiscal 2021 fourth quarter when compared to the same period in fiscal 2020.

The average balance of total deposits and interest-bearing liabilities was $6.17 billion for the three-month period ended September 30, 2021, compared to $6.66 billion for the same period in the prior fiscal year, representing a decrease of 7%.

Total end-of-period deposits increased 11% to $5.51 billion at September 30, 2021, compared to $4.98 billion at September 30, 2020. The increase in end-of-period deposits was primarily driven by an increase in noninterest-bearing deposits of $661.6 million, partially offset by a decrease in wholesale deposits of $269.1 million. The increase in noninterest-bearing deposits was driven by government stimulus-related dollars loaded on various partner cards.

Of the 16.5 million prepaid cards issued in conjunction with the three EIP stimulus programs, totaling approximately $24.15 billion, $1.64 billion were outstanding as of September 30, 2021, of which only $69.8 million was on Meta's balance sheet with the remainder being held by other banks.

Regulatory Capital

The Company and MetaBank remained above the federal regulatory minimum capital requirements at September 30, 2021, continued to be classified as well-capitalized, and in good standing with the regulatory agencies. A temporary exemption was granted by the Office of the Comptroller of the Currency related to the financial impacts of distributing prepaid debit cards as part of the EIP program. Regulatory capital ratios of the Company and the Bank are stated in the table below.

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.

Asset Pass Watch Special Substandard Doubtful TotalClassification Mention

As of June 30, (Dollars in Thousands)2021

Commercial $ 2,315,437 $ 133,124 $ 55,869 $ 74,930 $ 7,166 $ 2,586,526finance

Warehouse 335,704 - - - - 335,704finance

Community 195,721 33,494 14,574 60,196 - 303,985banking

Total Loans $ 2,846,862 $ 166,618 $ 70,443 $ 135,126 $ 7,166 $ 3,226,215and Leases

Deposits, Borrowings and Other Liabilities

Total average deposits for the fiscal 2021 fourth quarter decreased by $389.7 million to $6.08 billion compared to the same period in fiscal 2020, primarily due to a reduction in wholesale deposits. Average wholesale deposits decreased $485.3 million, while noninterest-bearing deposits decreased $11.1 million, for the fiscal 2021 fourth quarter when compared to the same period in fiscal 2020.

The average balance of total deposits and interest-bearing liabilities was $6.17 billion for the three-month period ended September 30, 2021, compared to $6.66 billion for the same period in the prior fiscal year, representing a decrease of 7%.

Total end-of-period deposits increased 11% to $5.51 billion at September 30, 2021, compared to $4.98 billion at September 30, 2020. The increase in end-of-period deposits was primarily driven by an increase in noninterest-bearing deposits of $661.6 million, partially offset by a decrease in wholesale deposits of $269.1 million. The increase in noninterest-bearing deposits was driven by government stimulus-related dollars loaded on various partner cards.

Of the 16.5 million prepaid cards issued in conjunction with the three EIP stimulus programs, totaling approximately $24.15 billion, $1.64 billion were outstanding as of September 30, 2021, of which only $69.8 million was on Meta's balance sheet with the remainder being held by other banks.

Regulatory Capital

The Company and MetaBank remained above the federal regulatory minimum capital requirements at September 30, 2021, continued to be classified as well-capitalized, and in good standing with the regulatory agencies. A temporary exemption was granted by the Office of the Comptroller of the Currency related to the financial impacts of distributing prepaid debit cards as part of the EIP program. Regulatory capital ratios of the Company and the Bank are stated in the table below.

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.

September June March December SeptemberAs of the dates indicated 30, 30, 31, 31, 30, 2021 ^(1) 2021 2021 2020 2020

Company

Tier 1 leverage capital 7.67 % 6.85 % 4.75 % 7.39 % 6.58 %ratio

Common equity Tier 1 12.12 % 12.76 % 11.29 % 10.72 % 11.78 %capital ratio

Tier 1 capital ratio 12.46 % 13.11 % 11.63 % 11.07 % 12.18 %

Total capital ratio 15.45 % 16.18 % 14.65 % 14.14 % 15.30 %

MetaBank

Tier 1 leverage capital 8.69 % 7.83 % 5.47 % 8.60 % 7.56 %ratio

Common equity Tier 1 14.11 % 14.94 % 13.39 % 12.87 % 13.96 %capital ratio

Tier 1 capital ratio 14.13 % 14.96 % 13.40 % 12.89 % 14.00 %

Total capital ratio 15.38 % 16.22 % 14.66 % 14.14 % 15.26 %

(1) September 30, 2021 amounts are preliminary pending completion and filing of the Company's regulatory reports. Regulatory capital presented for periods in fiscal year 2021 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 September June 30, March 31, December September 30,Approach^(1) 30, 2021 2021 31, 2020 2021 2020

(Dollars in Thousands)

Totalstockholders' $ 871,884 $ 876,633 $ 835,258 $ 813,210 $ 847,308 equity

Adjustments:

LESS: Goodwill,net of associated 300,780 301,179 301,602 301,999 302,396 deferred taxliabilities

LESS: Certainother intangible 33,572 35,100 36,779 39,403 40,964 assets

LESS: Net deferredtax assets fromoperating loss and 22,801 17,753 19,306 24,105 18,361 tax creditcarry-forwards

LESS: Netunrealized gains(losses) on 7,344 14,750 12,458 19,894 17,762 available-for-salesecurities

LESS:Non-controlling 1,155 1,490 1,092 1,536 3,603 interest

ADD: Adoption ofAccounting 8,202 13,913 10,439 10,439 - Standards Update2016-13

Common Equity Tier 514,434 520,274 474,460 436,712 464,222 1^(1)

Long-termborrowings andother instruments 13,661 13,661 13,661 13,661 13,661 qualifying as Tier1

Tier 1 minorityinterest notincluded in common 747 932 690 749 1,894 equity tier 1capital

Total Tier 1 528,842 534,867 488,811 451,122 479,777 Capital

Allowance for 53,159 51,317 53,232 51,070 49,343 credit losses

Subordinateddebentures (net of 73,980 73,936 73,892 73,850 73,807 issuance costs)

Total qualifying $ 655,981 $ 660,119 $ 615,935 $ 576,042 $ 602,927 capital

(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 are being fully phased in through the end of 2021.

The following table provides a reconciliation of tangible common equity and tangible common equity excluding accumulated other comprehensive income ("AOCI"), each of which is used in calculating tangible book value data, to Total Stockholders' Equity. Each of tangible common equity and tangible common equity excluding AOCI is a non-GAAP financial measure that is commonly used within the banking industry.

September June 30, March 31, December September 30, 30, 2021 2021 31, 2020 2021 2020

(Dollars in Thousands)

TotalStockholders' $ 871,884 $ 876,633 $ 835,258 $ 813,210 $ 847,308 Equity

Less: 309,505 309,505 309,505 309,505 309,505 Goodwill

Less:Intangible 33,148 34,898 36,903 39,660 41,692 assets

Tangible 529,231 532,230 488,850 464,045 496,111 common equity

Less:Accumulatedother 7,599 15,222 12,809 20,119 17,542 comprehensiveincome (loss)("AOCI")

Tangiblecommon equity $ 521,632 $ 517,008 $ 476,041 $ 443,926 $ 478,569 excludingAOCI

Conference Call

The Company will host a conference call and earnings webcast at 4:00 p.m. Central Time (5:00 p.m. Eastern Time) on Wednesday, October 27, 2021. The live webcast of the call can be accessed from Meta's Investor Relations website at www.metafinancialgroup.com. Telephone participants may access the conference call by dialing (844) 200-6205 approximately 10 minutes prior to start time and reference access code 483958. A webcast replay will also be archived at www.metafinancialgroup.com for one year.

Upcoming Investor Events

* KBW Financial Services Symposium, February 17, 2022 | Boca Raton, FL * Raymond James Institutional Investors Conference, March 8, 2022 | Orlando, FL

Forward-Looking Statements

The Company and MetaBank 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 SEC, the Company's reports to stockholders, and in other communications by the Company and MetaBank, 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," 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; expectations in connection with the impact of the ongoing COVID-19 pandemic and related government actions on our business, our industry and the capital markets; customer retention; loan and other product demand; expectations concerning acquisitions and divestitures; new products and services, including those offered by Meta Payment Systems, Refund Advantage, EPS Financial and Specialty Consumer Services divisions; credit quality; the level of net charge-offs and the adequacy of the allowance for credit losses; technology; and the Company's employees. 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 the ongoing COVID-19 pandemic and any governmental or societal responses thereto including the deployment and efficacy of the COVID-19 vaccines, or other unusual and infrequently occurring events; actual changes in interest rates and the Fed Funds rate; additional changes in tax laws; the strength of the United States' economy, in general, and the strength of the local economies in which the Company operates; changes in trade, monetary, and fiscal policies and laws, including interest rate policies of the Federal Reserve; inflation, market, and monetary fluctuations; the timely and efficient development of, and acceptance 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 of these products and services by users; the risks of dealing with or utilizing third parties, including, in connection with the Company's refund advance business, the risk of reduced volume of refund advance loans as a result of reduced customer demand for or usage of Meta's strategic partners' refund advance products; our relationship with, and any actions which may be initiated by, our regulators; the impact of changes in financial services laws and regulations, including, but not limited to, 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 MetaBank of its status as a well-capitalized institution; changes in consumer spending and saving habits; the impact of our participation as prepaid card issuer for the EIP program and similar programs in the future; 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, 2020, and in other filings made with the SEC. The Company expressly disclaims any intent or obligation to update 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)

ASSETS September 30, June 30, March 31, December 30, September 30, 2021 2021 2021 2020 2020

Cash and cash $ 314,019 $ 720,243 $ 3,724,242 $ 1,586,451 $ 427,367 equivalents

Investmentsecurities 847,870 854,023 921,947 797,363 814,495 available for sale,at fair value

Mortgage-backedsecurities 1,017,029 1,063,582 558,833 430,761 453,607 available for sale,at fair value

Investmentsecurities held to 52,944 60,228 67,709 76,176 87,183 maturity, at cost

Mortgage-backedsecurities held to 3,725 4,019 4,403 5,152 5,427 maturity, at cost

Loans held for sale 56,194 87,905 67,635 133,659 183,577

Loans and leases 3,609,563 3,496,670 3,657,531 3,448,675 3,322,765

Allowance for (68,281 ) (91,208 ) (98,892 ) (72,389 ) (56,188 ) credit losses

Federal ReserveBank and Federal 28,400 28,433 28,433 27,138 27,138 Home Loan Bankstocks, at cost

Accrued interest 16,254 16,230 17,429 17,133 16,628 receivable

Premises,furniture, and 44,888 44,107 41,510 39,932 41,608 equipment, net

Rental equipment, 213,116 211,368 211,397 206,732 205,964 net

Bank-owned life 94,749 94,142 93,542 92,937 92,315 insurance

Foreclosed realestate and 2,077 1,204 1,483 7,186 9,957 repossessed assets,net

Goodwill 309,505 309,505 309,505 309,505 309,505

Intangible assets 33,148 34,898 36,903 39,660 41,692

Prepaid assets 10,513 7,482 10,201 11,270 8,328

Deferred taxes 25,173 20,072 25,435 24,411 17,723

Other assets 79,764 88,909 110,877 82,763 82,983



Total assets $ 6,690,650 $ 7,051,812 $ 9,790,123 $ 7,264,515 $ 6,092,074



LIABILITIES ANDSTOCKHOLDERS' EQUITY



LIABILITIES

Deposits:

Noninterest-bearing 5,018,233 5,385,569 7,928,235 5,581,597 4,356,630 checking

Interest-bearing 254,721 255,509 416,164 274,504 157,571 checking

Savings deposits 86,356 93,608 126,834 54,080 47,866

Money market 67,204 63,920 55,045 56,440 48,494 deposits

Time certificates 9,091 11,425 12,614 13,522 20,223 of deposit

Wholesale deposits 79,366 78,840 103,521 227,648 348,416

Total deposits 5,514,971 5,888,871 8,642,413 6,207,791 4,979,200

Long-term 92,834 93,634 95,336 96,760 98,224 borrowings

Accrued interest 579 1,853 679 2,068 1,923 payable

Accrued expensesand other 210,382 190,821 216,437 144,686 165,419 liabilities

Total liabilities 5,818,766 6,175,179 8,954,865 6,451,305 5,244,766



STOCKHOLDERS' EQUITY

Preferred stock - - - - -

Common stock, $.01 317 319 319 326 344 par value

Common stock,Nonvoting, $.01 par - - - - - value

Additional paid-in 604,484 602,720 601,222 598,669 594,569 capital

Retained earnings 259,189 262,578 225,471 198,000 234,927

Accumulated othercomprehensive 7,599 15,222 12,809 20,119 17,542 income

Treasury stock, at (860 ) (5,696 ) (5,655 ) (5,440 ) (3,677 ) cost

Total equityattributable to 870,729 875,143 834,166 811,674 843,705 parent

Noncontrolling 1,155 1,490 1,092 1,536 3,603 interest

Total stockholders' 871,884 876,633 835,258 813,210 847,308 equity



Total liabilitiesand stockholders' $ 6,690,650 $ 7,051,812 $ 9,790,123 $ 7,264,515 $ 6,092,074 equity

Consolidated Statements of Operations (Unaudited)

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

Three Months Ended

Year Ended

September 30, 2021

June 30, 2021

September 30, 2020

September 30,2021

September 30,2020

Interest and dividend income:

Loans and leases, including fees

$

63,665

$

62,287

$

62,022

$

256,080

$

261,128

Mortgage-backed securities

3,979

3,446

1,877

12,155

9,028

Other investments

4,412

4,250

4,508

17,619

22,685

72,056

69,983

68,407

285,854

292,841

Interest expense:

Deposits

164

188

1,904

1,593

22,616

FHLB advances and other borrowings

1,225

1,320

1,990

5,270

11,187

1,389

1,508

3,894

6,863

33,803

Net interest income

70,667

68,475

64,513

278,991

259,038

Provision for credit losses

8,775

4,612

8,980

49,766

64,776

Net interest income after provision for credit losses

61,892

63,863

55,533

229,225

194,262

Noninterest income:

Refund transfer product fees

2,567

12,073

2,335

37,967

36,061

Tax advance product fees

226

891

(14

)

47,639

31,826

Payments card and deposit fees

25,541

29,203

21,422

107,182

87,379

Other bank and deposit fees

230

338

228

939

1,310

Rental income

9,709

9,976

10,144

39,416

44,826

Net gain realized on investment securities

-

-

51

6

51

Gain on divestitures

-

-

-

-

19,275

Gain (loss) on sale of other

580

5,955

3,455

11,515

4,425

Other income

10,689

4,017

3,129

26,240

14,641

Total noninterest income

49,542

62,453

40,750

270,904

239,794

Noninterest expense:

Compensation and benefits

36,222

38,604

35,616

151,090

136,247

Refund transfer product expense

3,219

2,435

162

11,861

7,644

Tax advance product expense

30

(25

)

(97

)

2,564

2,723

Card processing

7,063

6,809

6,524

27,201

25,956

Occupancy and equipment expense

8,252

7,381

6,826

29,269

26,995

Operating lease equipment depreciation

7,865

8,122

7,594

30,987

32,831

Legal and consulting

14,369

5,680

5,615

31,341

20,858

Intangible amortization

1,761

2,013

2,283

8,545

10,997

Impairment expense

601

505

1,232

2,818

1,982

Other expense

14,232

9,999

14,528

48,007

52,818

Total noninterest expense

93,614

81,523

80,283

343,683

319,051

Income before income tax expense

17,820

44,793

16,000

156,446

115,005

Income tax expense (benefit)

1,101

4,934

1,791

10,701

5,661

Net income before noncontrolling interest

16,719

39,859

14,209

145,745

109,344

Net income attributable to noncontrolling interest

816

1,158

1,051

4,037

4,624

Net income attributable to parent

$

15,903

$

38,701

$

13,158

$

141,708

$

104,720

Less: Allocation of Earnings to participating securities(1)

297

729

309

2,698

2,414

Net income attributable to common shareholders(1)

15,606

37,972

12,849

139,010

102,306

Earnings per common share

Basic

$

0.50

$

1.21

$

0.38

$

4.38

$

2.94

Diluted

$

0.50

$

1.21

$

0.38

$

4.38

$

2.94

Shares used in computing earnings per common share

Basic

31,280,162

31,320,893

33,783,659

31,729,596

34,829,971

Diluted

31,299,555

31,338,947

33,783,659

31,751,522

34,829,971

(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.

Consolidated Statements of Operations (Unaudited)



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

Three Months Ended Year Ended

September June 30, September September September 30, 2021 30, 30, 30, 2021 2020 2021 2020

Interest anddividend income:

Loans andleases, $ 63,665 $ 62,287 $ 62,022 $ 256,080 $ 261,128including fees

Mortgage-backed 3,979 3,446 1,877 12,155 9,028securities

Other 4,412 4,250 4,508 17,619 22,685investments

72,056 69,983 68,407 285,854 292,841

Interest expense:

Deposits 164 188 1,904 1,593 22,616

FHLB advancesand other 1,225 1,320 1,990 5,270 11,187borrowings

1,389 1,508 3,894 6,863 33,803



Net interest 70,667 68,475 64,513 278,991 259,038income



Provision for 8,775 4,612 8,980 49,766 64,776credit losses



Net interestincome after 61,892 63,863 55,533 229,225 194,262provision forcredit losses



Noninterest income:

Refund transfer 2,567 12,073 2,335 37,967 36,061product fees

Tax advance 226 891 (14 ) 47,639 31,826product fees

Payments cardand deposit 25,541 29,203 21,422 107,182 87,379fees

Other bank and 230 338 228 939 1,310deposit fees

Rental income 9,709 9,976 10,144 39,416 44,826

Net gainrealized on - - 51 6 51investmentsecurities

Gain on - - - - 19,275divestitures

Gain (loss) on 580 5,955 3,455 11,515 4,425sale of other

Other income 10,689 4,017 3,129 26,240 14,641

Totalnoninterest 49,542 62,453 40,750 270,904 239,794income



Noninterest expense:

Compensation 36,222 38,604 35,616 151,090 136,247and benefits

Refund transfer 3,219 2,435 162 11,861 7,644product expense

Tax advance 30 (25 ) (97 ) 2,564 2,723product expense

Card processing 7,063 6,809 6,524 27,201 25,956

Occupancy andequipment 8,252 7,381 6,826 29,269 26,995expense

Operating leaseequipment 7,865 8,122 7,594 30,987 32,831depreciation

Legal and 14,369 5,680 5,615 31,341 20,858consulting

Intangible 1,761 2,013 2,283 8,545 10,997amortization

Impairment 601 505 1,232 2,818 1,982expense

Other expense 14,232 9,999 14,528 48,007 52,818

Totalnoninterest 93,614 81,523 80,283 343,683 319,051expense



Income beforeincome tax 17,820 44,793 16,000 156,446 115,005expense



Income taxexpense 1,101 4,934 1,791 10,701 5,661(benefit)



Net incomebefore 16,719 39,859 14,209 145,745 109,344noncontrollinginterest

Net incomeattributable to 816 1,158 1,051 4,037 4,624noncontrollinginterest

Net incomeattributable to $ 15,903 $ 38,701 $ 13,158 $ 141,708 $ 104,720parent



Less:Allocation ofEarnings to 297 729 309 2,698 2,414participatingsecurities^(1)

Net incomeattributable tocommon 15,606 37,972 12,849 139,010 102,306shareholders^(1)

Earnings per common share

Basic $ 0.50 $ 1.21 $ 0.38 $ 4.38 $ 2.94

Diluted $ 0.50 $ 1.21 $ 0.38 $ 4.38 $ 2.94

Shares used incomputing earnings percommon share

Basic 31,280,162 31,320,893 33,783,659 31,729,596 34,829,971

Diluted 31,299,555 31,338,947 33,783,659 31,751,522 34,829,971

(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 2021 2020September 30,

Average Interest Yield Average Interest Yield(Dollars in / /Thousands) Outstanding Earned / Outstanding Earned / Rate^ Rate^ Balance Paid (1) Balance Paid (1)

Interest-earning assets:

Cash and fed funds $ 852,122 $ 1,248 0.58 % $ 1,960,020 $ 891 0.18 %sold

Mortgage-backed 1,049,258 3,979 1.50 % 394,456 1,877 1.89 %securities

Tax exemptinvestment 232,006 772 1.67 % 374,876 1,347 1.81 %securities

Asset-backed 400,507 1,199 1.19 % 331,939 1,241 1.49 %securities

Other investment 258,367 1,193 1.83 % 208,078 1,029 1.97 %securities

Total investments 1,940,138 7,143 1.50 % 1,309,349 5,494 1.78 %

Total commercial 2,690,064 48,285 7.12 % 2,240,591 42,390 7.53 %finance

Total consumer 258,043 4,308 6.62 % 234,468 3,998 6.78 %finance

Total tax services 37,174 165 1.76 % 16,651 5 0.13 %

Total warehouse 388,477 6,332 6.47 % 287,294 4,378 6.06 %finance

Total community 272,554 4,575 6.66 % 757,993 11,251 5.91 %banking loans

Total loans and 3,646,312 63,665 6.93 % 3,536,997 62,022 6.98 %leases

Totalinterest-earning $ 6,438,572 $ 72,056 4.45 % $ 6,806,366 $ 68,407 4.02 %assets

Noninterest-earning 822,592 866,407 assets

Total assets $ 7,261,164 $ 7,672,773



Interest-bearing liabilities:

Interest-bearing $ 243,005 $ - - % $ 186,952 $ - - %checking^(2)

Savings 89,110 5 0.02 % 52,616 1 0.01 %

Money markets 67,083 58 0.34 % 41,179 32 0.31 %

Time deposits 10,218 21 0.81 % 21,947 92 1.66 %

Wholesale deposits 77,506 80 0.41 % 562,828 1,779 1.26 %

Totalinterest-bearing 486,922 164 0.13 % 865,522 1,904 0.88 %deposits

FHLB advances - - - % 94,457 619 2.61 %

Subordinated 73,951 1,065 5.71 % 73,779 1,147 6.19 %debentures

Other borrowings 19,299 160 3.29 % 25,431 224 3.50 %

Total borrowings 93,250 1,225 5.21 % 193,667 1,990 4.09 %

Totalinterest-bearing 580,172 1,390 0.95 % 1,059,189 3,894 1.46 %liabilities

Noninterest-bearing 5,589,946 - - % 5,601,052 - - %deposits

Total deposits andinterest-bearing $ 6,170,118 $ 1,390 0.09 % $ 6,660,241 $ 3,894 0.23 %liabilities

Othernoninterest-bearing 204,726 164,766 liabilities

Total liabilities 6,374,844 6,825,007

Shareholders' 886,320 847,766 equity

Total liabilitiesand shareholders' $ 7,261,164 $ 7,672,773 equity

Net interest incomeand net interestrate spread $ 70,667 4.36 % $ 64,513 3.79 %includingnoninterest-bearingdeposits



Net interest margin 4.35 % 3.77 %

Tax-equivalent 0.01 % 0.02 %effect

Net interestmargin, 4.37 % 3.79 %tax-equivalent^(3)

(1) Tax rate used to arrive at the TEY for the three months ended September 30, 2021 and 2020 was 21%. (2) Of the total balance, $242.7 million are interest-bearing deposits where interest expense is paid by a third party and not by the Company. (3) 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 September June 30, March 31, December 31, Septemberthe Three 30, 2021 2021 2020 30,Months Ended 2021 2020

Equity to 13.03 % 12.43 % 8.53 % 11.19 % 13.91 %total assets

Book value percommon share $ 27.53 $ 27.46 $ 26.16 $ 24.93 $ 24.66 outstanding

Tangible bookvalue per $ 16.71 $ 16.67 $ 15.31 $ 14.23 $ 14.44 common shareoutstanding

Tangible bookvalue percommon share $ 16.47 $ 16.20 $ 14.91 $ 13.61 $ 13.93 outstandingexcluding AOCI

Common shares 31,669,952 31,919,780 31,926,008 32,620,251 34,360,890 outstanding

Nonperformingassets to 0.92 % 0.64 % 0.48 % 0.73 % 0.79 %total assets

Nonperformingloans andleases to 1.52 % 1.17 % 1.17 % 1.18 % 0.97 %total loansand leases

Net interest 4.35 % 3.75 % 3.07 % 4.65 % 3.77 %margin

Net interestmargin, 4.37 % 3.77 % 3.08 % 4.67 % 3.79 %tax-equivalent

Return on 0.88 % 1.90 % 2.22 % 1.73 % 0.69 %average assets

Return on 7.18 % 18.07 % 28.93 % 13.91 % 6.21 %average equity

Full-timeequivalent 1,124 1,109 1,075 1,038 1,015 employees

Non-GAAP Reconciliation

Efficiency Ratio

For the last twelve months ended

(Dollars in Thousands)

September 30,2021

June 30,2021

March 31,2021

December 31,2020

September 30,2020

Noninterest Expense - GAAP

$

343,683

$

330,352

$

320,070

$

315,828

$

319,051

Net Interest Income

278,991

272,837

266,499

260,386

259,038

Noninterest Income

270,903

262,111

240,706

247,766

239,794

Total Revenue: GAAP

$

549,894

$

534,948

$

507,205

$

508,152

$

498,832

Efficiency Ratio, last twelve months

62.50

%

61.75

%

63.10

%

62.15

%

63.96

%

About Meta Financial Group, Inc.(r)

Meta Financial Group, Inc.(r)("Meta") (Nasdaq: CASH) is a South Dakota-based financial holding company. At Meta, our mission is financial inclusion for all(r). Through our subsidiary, MetaBank(r), N.A., we strive to remove barriers to financial access and promote economic mobility by working with third parties to provide responsible, secure, high quality financial products that contribute to the social and economic benefit of communities at the core of the real economy. Meta works to increase financial availability, choice, and opportunity for all. Additional information can be found by visiting www.metafinancialgroup.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20211027006045/en/

CONTACT: Investor Relations Contact Brittany Kelley Elsasser 605-362-2423 bkelley@metabank.com Media Relations Contact mediarelations@metabank.com