What changed in this filing

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Item 1. Financial Statements

2025-09-16 compared with 2025-09-10 · 136 added, 137 removed, 1140 unchanged (19% of the section changed)

3 unchanged sentences

Condensed Consolidated Statements of Financial Condition

(Dollars in thousands, except per share data) March 31, 2025 September 30, 2024

(Dollars in thousands, except per share data) June 30, 2025 September 30, 2024

ASSETS (Unaudited) (Audited)

20 unchanged sentences

STOCKHOLDERS’ EQUITY

Preferred stock, 3,000,000 shares authorized, no shares issued, none outstanding at March 31, 2025 and September 30, 2024, respectively

Preferred stock, 3,000,000 shares authorized, no shares issued, none outstanding at June 30, 2025 and September 30, 2024, respectively

Common stock, $ 0.01 par value;

90,000,000 shares authorized, 23,629,154 and 24,851,122 shares issued, 23,558,939 and 24,847,353 shares outstanding at March 31, 2025 and September 30, 2024, respectively

90,000,000 shares authorized, 23,023,823 and 24,851,122 shares issued, 22,953,608 and 24,847,353 shares outstanding at June 30, 2025 and September 30, 2024, respectively

Common stock, Nonvoting, $ 0.01 par value;

3,000,000 shares authorized, no shares issued, none outstanding at March 31, 2025 and September 30, 2024, respectively

3,000,000 shares authorized, no shares issued, none outstanding at June 30, 2025 and September 30, 2024, respectively

Additional paid-in capital 646,044 638,803

1 unchanged sentence

Accumulated other comprehensive loss ( 159,709 ) ( 153,394 )

Treasury stock, at cost, 70,215 and 3,769 common shares at March 31, 2025 and September 30, 2024, respectively

Treasury stock, at cost, 70,215 and 3,769 common shares at June 30, 2025 and September 30, 2024, respectively

( 4,882 ) ( 249 )

7 unchanged sentences

Condensed Consolidated Statements of Operations (Unaudited)

Three Months Ended March 31, Six Months Ended March 31,

(Dollars in thousands, except per share data) 2025 2024 2025 2024

(As Restated) (As Restated)

Three Months Ended June 30, Nine Months Ended June 30,

2025 2024 2025 2024

(Dollars in thousands, except per share data) (As Restated) (As Restated)

Interest and dividend income:

45 unchanged sentences

Condensed Consolidated Statements of Comprehensive Income (Unaudited)

Three Months Ended March 31, Six Months Ended March 31,

(Dollars in thousands) 2025 2024 2025 2024

(As Restated) (As Restated)

Three Months Ended June 30, Nine Months Ended June 30,

2025 2024 2025 2024

(Dollars in thousands) (As Restated) (As Restated)

Net income before noncontrolling interest $ 42,360 $ 45,081 $ 147,719 $ 150,404

24 unchanged sentences

Stockholders’

Balance, December 31, 2024 (As Restated) $ 241 $ 640,422 $ 313,446 $ ( 190,917 ) $ ( 4,882 ) $ 758,310 $ ( 756 ) $ 757,554

Balance, March 31, 2025 $ 235 $ 643,888 $ 341,775 $ ( 166,311 ) $ ( 4,882 ) $ 814,705 $ ( 658 ) $ 814,047

Cash dividends declared on common stock ($ 0.05 per share)

5 unchanged sentences

Net distribution to noncontrolling interest — — — — — — ( 411 ) ( 411 )

Balance, March 31, 2025

Balance, June 30, 2025

$ 230 $ 646,044 $ 337,321 $ ( 159,709 ) $ ( 4,882 ) $ 819,004 $ ( 856 ) $ 818,148

Balance, December 31, 2023 (As Restated) $ 260 $ 629,737 $ 268,427 $ ( 188,433 ) $ ( 5,235 ) $ 704,756 $ ( 510 ) $ 704,246

Balance, March 31, 2024 (As Restated) $ 254 $ 634,415 $ 297,578 $ ( 206,570 ) $ ( 6,181 ) $ 719,496 $ ( 420 ) $ 719,076

Cash dividends declared on common stock ($ 0.05 per share)

— — ( 1,257 ) — — ( 1,257 ) — ( 1,257 )

Issuance of common stock due to restricted stock 2 — — — — 2 — 2

Repurchases of common stock ( 3 ) 3 ( 15,150 ) — — ( 15,150 ) — ( 15,150 )

3 unchanged sentences

Net distribution to noncontrolling interest — — — — — — ( 298 ) ( 298 )

Balance, March 31, 2024 (As Restated)

Balance, June 30, 2024 (As Restated)

$ 251 $ 636,284 $ 326,040 $ ( 207,992 ) $ ( 6,181 ) $ 748,402 $ ( 506 ) $ 747,896

Six Months Ended

Nine Months Ended

(Dollars in thousands, except per share data) Common

17 unchanged sentences

Net distribution to noncontrolling interest — — — — — — ( 1,229 ) ( 1,229 )

Balance, March 31, 2025

Balance, June 30, 2025

$ 230 $ 646,044 $ 337,321 $ ( 159,709 ) $ ( 4,882 ) $ 819,004 $ ( 856 ) $ 818,148

10 unchanged sentences

Net distribution to noncontrolling interest — — — — — — ( 219 ) ( 219 )

Balance, March 31, 2024 (As Restated)

Balance, June 30, 2024 (As Restated)

$ 251 $ 636,284 $ 326,040 $ ( 207,992 ) $ ( 6,181 ) $ 748,402 $ ( 506 ) $ 747,896

3 unchanged sentences

Condensed Consolidated Statements of Cash Flows (Unaudited)

Six Months Ended March 31,

Nine Months Ended June 30,

(Dollars in thousands) 2025 2024

Cash flows from operating activities:

(As Restated)

Cash flows from operating activities:

Net income before noncontrolling interest $ 147,719 $ 150,404

6 unchanged sentences

Net change in loans held for sale ( 1,791 ) 18,062

Net realized (gain) on loans held for sale ( 26,900 ) ( 3,091 )

Net realized loss (gain) on securities available for sale 22,899 —

Net realized (gain) loss on loans held for sale ( 19,755 ) ( 1,370 )

Net realized (gain) loss on divestitures ( 15,044 ) —

Net realized (gain) on divestitures ( 15,044 ) —

Net realized (gain) on other ( 2,007 ) ( 6,119 )

30 unchanged sentences

Investment by (distributions to) noncontrolling interest ( 1,229 ) ( 219 )

Net cash provided by (used in) financing activities ( 526,458 ) ( 262,236 )

Net cash (used in) financing activities ( 272,435 ) ( 246,840 )

Effect of exchange rate changes on cash 30 ( 259 )

2 unchanged sentences

Cash and cash equivalents at end of fiscal period $ 258,343 $ 298,926

Six Months Ended March 31,

PATHWARD FINANCIAL, INC.

AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows (Unaudited)

Nine Months Ended June 30,

(Dollars in thousands) 2025 2024

Supplemental disclosure of cash flow information (As Restated)

Supplemental disclosure of cash flow information:

Cash paid during the period for:

20 unchanged sentences

Such information reflects all adjustments (consisting of normal recurring adjustments) that are, in the opinion of management, necessary for a fair presentation of the financial position and results of operations for the periods presented.

The results of the three and six months ended March 31, 2025 are not necessarily indicative of the results expected for the fiscal year ending September 30, 2025.

The results of the three and nine months ended June 30, 2025 are not necessarily indicative of the results expected for the fiscal year ending September 30, 2025.

Certain prior fiscal year amounts have been reclassified to conform to the current year financial statement presentation.

These reclassifications did not impact previously reported net income, comprehensive income or the statement of financial condition.

Additionally, the Company began using "Secondary Market Revenue" on the Condensed Consolidated Statement of Operations for the interim period ending March 31, 2025 versus the previous caption of "Gain (Loss) on Sale of Loans and Leases".

Additionally, the Company began using "Secondary Market Revenue" on the Condensed Consolidated Statement of Operations for the interim period ending March 31, 2025 and June 30, 2025 versus the previous caption of "Gain (Loss) on Sale of Loans and Leases".

This line item exclusively comprises gains or losses realized from the sale of loans and leases, including any adjustments to record loans held for sale at the lower of amortized cost basis or fair value in accordance with ASC 860-20-50-5.

19 unchanged sentences

The amendments in this ASU will be effective for the Company beginning October 1, 2027.

This ASU impacts disclosure only, and therefore will not impact our

consolidated financial statements.

This ASU impacts disclosure only, and therefore will not impact our consolidated financial statements.

The Company is currently evaluating the impact of this ASU on required annual and interim disclosures.

3 unchanged sentences

(Dollars in thousands) December 31, 2024 Settlement

Adjustments March 31, 2025

Adjustments June 30, 2025

Assets Purchased and Liabilities Assumed

26 unchanged sentences

Debt Securities AFS

March 31, 2025

June 30, 2025

Corporate securities $ 25,000 $ — $ ( 3,875 ) $ 21,125

14 unchanged sentences

Debt Securities HTM

March 31, 2025

June 30, 2025

Non-bank qualified obligations of states and political subdivisions $ 28,314 $ — $ ( 4,263 ) $ 24,051

12 unchanged sentences

Debt Securities AFS

March 31, 2025

June 30, 2025

Corporate securities $ — $ — $ 21,125 $ ( 3,875 ) $ 21,125 $ ( 3,875 )

SBA securities — — 10,683 ( 1,108 ) 10,683 ( 1,108 )

Obligations of state and political subdivisions 161 ( 1 ) — — 161 ( 1 )

Non-bank qualified obligations of states and political subdivisions — — 187,593 ( 28,806 ) 187,593 ( 28,806 )

11 unchanged sentences

Debt Securities HTM

March 31, 2025

June 30, 2025

Non-bank qualified obligations of states and political subdivisions $ — $ — $ 24,051 $ ( 4,263 ) $ 24,051 $ ( 4,263 )

5 unchanged sentences

Total debt securities HTM $ — $ — $ 30,236 $ ( 2,856 ) $ 30,236 $ ( 2,856 )

The decrease in the fair value of investment securities balances when comparing March 31, 2025 to September 30, 2024 was primarily driven by the sale of $ 217.9 million debt securities AFS and principal pay downs during the six months.

The decrease in the fair value of investment securities balances when comparing June 30, 2025 to September 30, 2024 was primarily driven by the sale of $ 217.9 million debt securities AFS and principal pay downs during the nine months.

The sale of debt securities AFS in the first quarter of fiscal 2025 stemmed from the decision to offset the gain on the sale of the commercial insurance premium finance business.

1 unchanged sentence

Individual securities were identified for sale upon close of the transactions in order to reposition the debt securities AFS portfolio.

At March 31, 2025, there were 152 debt securities AFS in an unrealized loss position.

At June 30, 2025, there were 153 debt securities AFS in an unrealized loss position.

Management assessed each investment security with unrealized losses for credit loss by evaluating qualitative factors, including materiality of loss position as a percentage of book value, credit ratings, outstanding principal and interest payments, and changes in the underlying implicit or explicit guarantee of the security, and determined all unrealized losses on these securities were due to adverse market conditions and/or change in interest rates versus credit loss.

As part of that assessment, management evaluated and concluded that it is more-likely-than-not that the Company will not be required and does not intend to sell any of the securities prior to recovery of the amortized cost.

At March 31, 2025, there was no allowance for credit losses ("ACL") for debt securities AFS.

At June 30, 2025, there was no allowance for credit losses ("ACL") for debt securities AFS.

The amortized cost and fair value of debt securities by contractual maturity are shown below.

4 unchanged sentences

However, certain prepayment penalties may apply.

(Dollars in thousands) March 31, 2025 September 30, 2024

(Dollars in thousands) June 30, 2025 September 30, 2024

Debt Securities AFS Amortized Cost Fair

15 unchanged sentences

One-half of the subscription is paid at time of application, and one-half is subject to call of the Board of Governors of the Federal Reserve System.

FRB of Minneapolis stock held by the Bank totaled $ 19.7 million at March 31, 2025 and September 30, 2024.

FRB of Minneapolis stock held by the Bank totaled $ 19.7 million at June 30, 2025 and September 30, 2024.

These equity securities are 'restricted' in that they can only be owned by member banks.

5 unchanged sentences

The FHLB stock is carried at cost since it is generally redeemable at par value.

The carrying value of the stock held at the FHLB was $ 4.6 million and $ 16.3 million at March 31, 2025 and at September 30, 2024, respectively.

The carrying value of the stock held at the FHLB was $ 9.8 million and $ 16.3 million at June 30, 2025 and at September 30, 2024, respectively.

These equity securities are ‘restricted’ in that they can only be sold back to the respective institution from which they were acquired or another member institution at par.

1 unchanged sentence

Equity Securities.

The Company held $ 3.6 million and $ 3.3 million in marketable equity securities within other assets on the Condensed Consolidated Statements of Financial Condition at March 31, 2025 and September 30, 2024, respectively.

The Company recognized $ 0.1 million unrealized losses and no unrealized gains on marketable equity securities during the six months ended March 31, 2025 and 2024, respectively.

No such securities were sold during the six months ended March 31, 2025.

Non-marketable equity securities with a readily determinable fair value totaled $ 12.8 million and $ 11.8 million at March 31, 2025 and September 30, 2024, respectively.

The Company held $ 3.7 million and $ 3.3 million in marketable equity securities within other assets on the Condensed Consolidated Statements of Financial Condition at June 30, 2025 and September 30, 2024, respectively.

The Company recognized $ 0.1 million and $ 0.2 million in unrealized losses on marketable equity securities during the nine months ended June 30, 2025 and 2024, respectively.

No such securities were sold during the nine months ended June 30, 2025.

Non-marketable equity securities with a readily determinable fair value totaled $ 12.7 million and $ 11.8 million at June 30, 2025 and September 30, 2024, respectively.

These securities are held within other assets on the Condensed Consolidated Statements of Financial Condition.

The Company recognized $ 0.8 million and $ 0.4 million in unrealized gains during the six months ended March 31, 2025 and 2024, respectively.

No such securities were sold during the six months ended March 31, 2025.

Non-marketable equity securities without readily determinable fair value totaled $ 14.7 million and $ 13.6 million at March 31, 2025 and September 30, 2024, respectively, reflecting Company ownership interests in other entities through its Pathward Venture Capital, LLC, a wholly-owned service corporation subsidiary of the Bank that was formed in 2017 for the purpose of making minority equity investments and other corporate investments.

During the six months ended March 31, 2025, the Company recognized a $ 0.4 million gain on Visa shares which were carried at a cost basis of $0.

The Company recognized $ 1.1 million and $ 0.6 million in unrealized gains during the nine months ended June 30, 2025 and 2024, respectively.

No such securities were sold during the nine months ended June 30, 2025.

Non-marketable equity securities without readily determinable fair value totaled $ 14.7 million and $ 13.6 million at June 30, 2025 and September 30, 2024, respectively, reflecting Company ownership interests in other entities through its Pathward Venture Capital, LLC, a wholly-owned service corporation subsidiary of the Bank that was formed in 2017 for the purpose of making minority equity investments and other corporate investments.

During the nine months ended June 30, 2025, the Company recognized a $ 0.4 million gain on Visa shares which were carried at a cost basis of $0.

This gain was recognized within the gain on sale of other on the Condensed Consolidated Statements of Operations.

There were no additional such securities sold during the six months ended March 31, 2025.

There were no additional such securities sold during the nine months ended June 30, 2025.

Equity Securities Impairment.

1 unchanged sentence

All other equity investments, including those under the equity method, are reviewed for other-than-temporary impairment on at least a quarterly basis.

The Company recognized no impairment for such investments for the six months ended March 31, 2025 and 2024.

The Company recognized no impairment for such investments for the nine months ended June 30, 2025 and 2024.

LOANS AND LEASES, NET

Loans and leases consist of the following:

(Dollars in thousands) March 31, 2025 September 30, 2024

(Dollars in thousands) June 30, 2025 September 30, 2024

Term lending $ 2,003,699 $ 1,554,641

13 unchanged sentences

Total loans and leases, net $ 4,637,329 $ 4,003,430

During the six months ended March 31, 2025 and 2024, the Company originated $ 1.38 billion and $ 933.8 million of commercial finance and consumer finance as held for sale, respectively.

The Company sold held for sale loans resulting in proceeds of $ 1.15 billion and a $ 19.8 million gain on sale during the six months ended March 31, 2025.

The Company sold held for sale loans resulting in proceeds of $ 969.0 million and a $ 1.4 million gain on sale during the six months ended March 31, 2024.

During the nine months ended June 30, 2025 and 2024, the Company originated $ 1.93 billion and $ 1.43 billion of commercial finance and consumer finance as held for sale, respectively.

The Company sold held for sale loans resulting in proceeds of $ 2.16 billion and a $ 26.9 million gain on sale during the nine months ended June 30, 2025.

The Company sold held for sale loans resulting in proceeds of $ 1.47 billion and a $ 3.1 million gain on sale during the nine months ended June 30, 2024 .

Gains and losses from the sale of loans and leases are included in secondary market revenue on the Condensed Consolidated Statements of Operations.

1 unchanged sentence

Loans purchased and sold by portfolio segment, including participation interests, were as follows:

Three Months Ended March 31, Six Months Ended March 31,

Three Months Ended June 30, Nine Months Ended June 30,

(Dollars in thousands) 2025 2024 2025 2024

10 unchanged sentences

The net investment in direct financing and sales-type leases was comprised of the following:

(Dollars in thousands) March 31, 2025 September 30, 2024

(Dollars in thousands) June 30, 2025 September 30, 2024

Minimum lease payments receivable $ 144,134 $ 162,757

4 unchanged sentences

The components of total lease income were as follows:

Three Months Ended March 31, Six Months Ended March 31,

Three Months Ended June 30, Nine Months Ended June 30,

(Dollars in thousands) 2025 2024 2025 2024

7 unchanged sentences

(1) Other leasing and equipment finance noninterest income consists of gains (losses) on sales of leased equipment, fees and service charges on leases and gains (losses) on sales of leases.

Undiscounted future minimum lease payments receivable for direct financing and sales-type leases, and a reconciliation to the carrying amount recorded at March 31, 2025 were as follows:

Undiscounted future minimum lease payments receivable for direct financing and sales-type leases, and a reconciliation to the carrying amount recorded at June 30, 2025 were as follows:

(Dollars in thousands)

4 unchanged sentences

Total carrying amount of minimum lease payments for direct financing and sales-type leases $ 144,134

The Company did not record any contingent rental income from direct financing and sales-type leases in the six months ended March 31, 2025.

The Company did not record any contingent rental income from direct financing and sales-type leases in the nine months ended June 30, 2025.

A number of factors that began to affect the economic environment in 2023 have continued into 2025, including economic uncertainty, inflation, increased interest rates, with the Federal Reserve beginning to lower the target federal funds rate at the end of 2024, and geopolitical conflict.

5 unchanged sentences

(Dollars in thousands) Beginning Balance Provision (Reversal) Charge-offs Recoveries Ending Balance

Three Months Ended March 31, 2025

Three Months Ended June 30, 2025

Allowance for credit losses:

14 unchanged sentences

(As Restated)

Beginning Balance Provision (Reversal) Charge-offs Recoveries Ending Balance

Three Months Ended March 31, 2024

Three Months Ended June 30, 2024 Beginning Balance Provision (Reversal) Charge-offs Recoveries Ending Balance

Allowance for credit losses:

16 unchanged sentences

(Dollars in thousands) Beginning Balance Provision (Reversal) Charge-offs Recoveries Ending Balance

Six Months Ended March 31, 2025

Nine Months Ended June 30, 2025

Allowance for credit losses:

15 unchanged sentences

(As Restated)

Beginning Balance Provision (Reversal) Charge-offs Recoveries Ending Balance

Six Months Ended March 31, 2024

Nine Months Ended June 30, 2024 Beginning Balance Provision (Reversal) Charge-offs Recoveries Ending Balance

Allowance for credit losses:

16 unchanged sentences

Information on loans and leases that are deemed to be collateral dependent and are evaluated individually for the ACL was as follows:

(Dollars in thousands) March 31, 2025 September 30, 2024

(Dollars in thousands) June 30, 2025 September 30, 2024

Term lending $ 33,789 $ 15,491

9 unchanged sentences

Due to the nature of the transactions and significant cash collateral positions, these credits are evaluated individually.

The balance of these pass rated cash collateral loans totaled $ 117.5 million and $ 105.1 million at March 31, 2025 and at September 30, 2024, respectively.

The balance of these pass rated cash collateral loans totaled $ 111.0 million and $ 105.1 million at June 30, 2025 and at September 30, 2024, respectively.

Federal regulations provide for the classification of loans and other assets such as debt and equity securities considered by the Bank's primary regulator, the OCC, to be of lesser quality as “substandard,” “doubtful” or “loss.” The loan classification and risk rating definitions are as follows:

22 unchanged sentences

Due to the unique risks associated with these portfolios, the Company monitors other credit quality indicators in its evaluation of the appropriateness of the ACL on these portfolios, and as such, these loans are not included in the asset classification table below.

The outstanding balances of consumer finance loans and tax services loans were $ 246.2 million and $ 56.0 million at March 31, 2025, respectively, and $ 248.8 million and $ 8.8 million at September 30, 2024, respectively.

The outstanding balances of consumer finance loans and tax services loans were $ 226.4 million and $ 37.4 million at June 30, 2025, respectively, and $ 248.8 million and $ 8.8 million at September 30, 2024 , respectively.

The amortized cost basis of loans and leases by asset classification and year of origination was as follows:

1 unchanged sentence

(Dollars in thousands) Term Loans and Leases by Origination Year Revolving Loans and Leases Total

March 31, 2025 2025 2024 2023 2022 2021 Prior

June 30, 2025 2025 2024 2023 2022 2021 Prior

Pass $ 639,497 $ 447,978 $ 307,564 $ 106,578 $ 65,242 $ 43,752 $ — $ 1,610,611

117 unchanged sentences

(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

March 31, 2025

June 30, 2025

Loans held for sale $ — $ — $ — $ — $ 49,767 $ 49,767 $ — $ — $ —

28 unchanged sentences

(Dollars in thousands) Term Loans and Leases by Origination Year Revolving Loans and Leases Total Nonaccrual with No ACL

March 31, 2025 2025 2024 2023 2022 2021 Prior

June 30, 2025 2025 2024 2023 2022 2021 Prior

Term lending $ — $ 807 $ 13,395 $ 11,286 $ 13,537 $ 192 $ — $ 39,217 $ 19,152

17 unchanged sentences

(Dollars in thousands) Term Loans and Leases by Origination Year Revolving Loans and Leases Total

March 31, 2025 2025 2024 2023 2022 2021 Prior

June 30, 2025 2025 2024 2023 2022 2021 Prior

Term lending $ — $ — $ — $ 187 $ — $ 1 $ — $ 188

Lease financing — 100 149 669 — — — 918

SBA/USDA — 2,264 — — — — — 2,264

17 unchanged sentences

The following table provides the average recorded investment in nonaccrual loans and leases:

Three Months Ended March 31, Six Months Ended March 31,

Three Months Ended June 30, Nine Months Ended June 30,

(Dollars in thousands) 2025 2024 2025 2024

6 unchanged sentences

Total loans and leases $ 50,173 $ 24,462 $ 38,641 $ 29,857

The recognized interest income on the Company's nonaccrual loans and leases for the three and six months ended March 31, 2025 and 2024 was not significant.

Modifications made to borrowers experiencing financial difficulty during the three and six months ended March 31, 2025 were $ 5.9 million and $ 9.1 million, respectively, in the commercial finance loan portfolio.

The recognized interest income on the Company's nonaccrual loans and leases for the three and nine months ended June 30, 2025 and 2024 was not significant.

Modifications made to borrowers experiencing financial difficulty during the three and nine months ended June 30, 2025 were none and $ 9.1 million, respectively, in the commercial finance loan portfolio.

The types of modifications granted were term extensions.

Modifications made to borrowers experiencing financial difficulty during the three and six months ended March 31, 2024 were $ 1.6 million in the commercial finance loan portfolio.

During the six months ended March 31, 2025, the Company had $ 6.1 million of commercial finance loans where a modification was granted in the previous 12 months in which there was a payment default.

As of March 31, 2025, no modifications granted during the current six month period were in the 60-89 days past due category.

During the six months ended March 31, 2024, the Company had no modifications granted in the previous 12 months in which there was a payment default.

Modifications made to borrowers experiencing financial difficulty during the three and nine months ended June 30, 2024 were $ 6.1 million and $ 7.6 million in the commercial finance loan portfolio, respectively.

During the nine months ended June 30, 2025, the Company had $ 7.2 million of commercial finance loans where a modification was granted in the previous 12 months in which there was a payment default.

As of June 30, 2025, no modifications granted during the current nine month period were in the 60-89 days past due category.

During the nine months ended June 30, 2024, the Company had $ 1.5 million of commercial finance loans where a modification was granted in the previous 12 months in which there was a payment default.

EARNINGS PER COMMON SHARE ("EPS")

7 unchanged sentences

A reconciliation of net income and common stock share amounts used in the computation of basic and diluted earnings per share is presented below.

Three Months Ended March 31, Six Months Ended March 31,

(Dollars in thousands, except per share data) 2025 2024 2025 2024

(As Restated) (As Restated)

Three Months Ended June 30, Nine Months Ended June 30,

2025 2024 2025 2024

(Dollars in thousands, except per share data) (As Restated) (As Restated)

Basic income per common share:

16 unchanged sentences

(1) Represents the effect of the assumed vesting of PSUs and restricted stock, as applicable, utilizing the treasury stock method.

(2) Excluded from the computation of diluted earnings per share for the three months ended March 31, 2025 and 2024, respectively, were 83,665 and 204,877 weighted average share of nonvested restricted stock because their inclusion would be anti-dilutive.

Excluded from the computation of diluted earnings per share for the six months ended March 31, 2025 and 2024, respectively, were 92,172 and 206,060 weighted average shares of nonvested restricted stock because their inclusion would be anti-dilutive.

(2) Excluded from the computation of diluted earnings per share for the three months ended June 30, 2025 and 2024, respectively, were 83,151 and 260,415 weighted average share of nonvested restricted stock because their inclusion would be anti-dilutive.

Excluded from the computation of diluted earnings per share for the nine months ended June 30, 2025 and 2024, respectively, were 89,175 and 224,035 weighted average shares of nonvested restricted stock because their inclusion would be anti-dilutive.

RENTAL EQUIPMENT, NET

Rental equipment consists of the following:

(Dollars in thousands) March 31, 2025 September 30, 2024

(Dollars in thousands) June 30, 2025 September 30, 2024

Computers and IT networking equipment $ 12,080 $ 21,308

6 unchanged sentences

Net book value $ 181,370 $ 205,339

Future minimum lease payments expected to be received for operating leases at March 31, 2025 were as follows:

Future minimum lease payments expected to be received for operating leases at June 30, 2025 were as follows:

(Dollars in thousands)

3 unchanged sentences

GOODWILL AND INTANGIBLE ASSETS

The Company held a total of $ 297.9 million of goodwill at March 31, 2025.

The Company held a total of $ 297.9 million of goodwill at June 30, 2025.

The recorded goodwill is a result of multiple business combinations that occurred from 2015 to 2018.

During the six months ended March 31, 2025, the Company closed on the sale of the commercial insurance premium finance business and derecognized the goodwill associated with that reporting unit.

During the nine months ended June 30, 2025, the Company closed on the sale of the commercial insurance premium finance business and derecognized the goodwill associated with that reporting unit.

The goodwill was included in the carrying amount of the disposed business.

4 unchanged sentences

Divestiture — ( 11,577 ) — ( 11,577 )

March 31, 2025 $ 87,145 $ 210,783 $ — $ 297,928

June 30, 2025 $ 87,145 $ 210,783 $ — $ 297,928

September 30, 2023 $ 87,145 $ 222,360 $ — $ 309,505

March 31, 2024 $ 87,145 $ 222,360 $ — $ 309,505

The changes in the carrying amount of the Company’s intangible assets during the six months ended March 31, 2025 include certain intangibles disposed of as part of the commercial insurance premium finance business sale.

June 30, 2024 $ 87,145 $ 222,360 $ — $ 309,505

The changes in the carrying amount of the Company’s intangible assets during the nine months ended June 30, 2025 include certain intangibles disposed of as part of the commercial insurance premium finance business sale.

The relevant intangibles were included in the carrying amount of the disposed business.

6 unchanged sentences

Write-offs and disposals during the period — — ( 631 ) — ( 631 )

March 31, 2025 $ 5,884 $ — $ 4,871 $ 3,309 $ 14,064

June 30, 2025 $ 5,616 $ — $ 4,473 $ 3,176 $ 13,265

Gross carrying amount $ 13,774 $ 301 $ 70,338 $ 7,732 $ 92,145

1 unchanged sentence

Accumulated impairment — — ( 10,918 ) ( 153 ) ( 11,071 )

March 31, 2025 $ 5,884 $ — $ 4,871 $ 3,309 $ 14,064

June 30, 2025 $ 5,616 $ — $ 4,473 $ 3,176 $ 13,265

September 30, 2023 $ 7,477 $ — $ 9,110 $ 4,133 $ 20,720

Amortization during the period ( 790 ) — ( 2,018 ) ( 399 ) ( 3,207 )

March 31, 2024 $ 6,950 $ — $ 7,679 $ 3,867 $ 18,496

June 30, 2024 $ 6,687 $ — $ 7,092 $ 3,734 $ 17,513

Gross carrying amount $ 13,774 $ 301 $ 77,578 $ 7,732 $ 99,385

1 unchanged sentence

Accumulated impairment — — ( 10,918 ) ( 153 ) ( 11,071 )

March 31, 2024 $ 6,950 $ — $ 7,679 $ 3,867 $ 18,496

June 30, 2024 $ 6,687 $ — $ 7,092 $ 3,734 $ 17,513

(1) Book amortization period of 5 - 15 years.

5 unchanged sentences

The estimated amortization expense of intangible assets assumes no activities, such as acquisitions, which would result in additional amortizable intangible assets.

Estimated amortization expense of intangible assets in the remaining six months of fiscal 2025 and subsequent fiscal years at March 31, 2025 was as follows:

Estimated amortization expense of intangible assets in the remaining three months of fiscal 2025 and subsequent fiscal years at June 30, 2025 was as follows:

(Dollars in thousands)

2 unchanged sentences

Total anticipated intangible amortization $ 13,265

There were no impairments to intangible assets during the six months ended March 31, 2025 and 2024.

There were no impairments to intangible assets during the nine months ended June 30, 2025 and 2024.

Intangible impairment expense is recorded within the impairment expense line of the Condensed Consolidated Statements of Operations.

OPERATING LEASE RIGHT-OF-USE ASSETS AND LIABILITIES

Operating lease right-of-use ("ROU") assets, included in other assets , were $ 24.1 million and $ 24.4 million at March 31, 2025 and September 30, 2024, respectively.

Operating lease liabilities, included in accrued expenses and other liabilities , were $ 25.2 million and $ 26.0 million at March 31, 2025 and September 30, 2024, respectively.

The decreases in lease ROU assets and liabilities relate to normal amortization and lease payments made during the six months ended March 31, 2025, but also include adjustments for lease assignments that occurred as a result of the commercial insurance premium finance business sale during the first quarter.

Operating lease right-of-use ("ROU") assets, included in other assets , were $ 23.2 million and $ 24.4 million at June 30, 2025 and September 30, 2024, respectively.

Operating lease liabilities, included in accrued expenses and other liabilities , were $ 24.5 million and $ 26.0 million at June 30, 2025 and September 30, 2024, respectively.

The decreases in lease ROU assets and liabilities relate to normal amortization and lease payments made during the nine months ended June 30, 2025, but also include adjustments for lease assignments that occurred as a result of the commercial insurance premium finance business sale during the first quarter.

Two office locations, Newport Beach, California and Addison, Texas, were included in the sale of the commercial insurance premium finance business and the relevant lease ROU assets and liabilities are no longer reflected in the Company's Condensed Consolidated Financial Statements after the transaction closed.

1 unchanged sentence

Divestitures to the Condensed Consolidated Financial Statements for further information.

Undiscounted future minimum operating lease payments and a reconciliation to the amount recorded as operating lease liabilities at March 31, 2025 were as follows:

Undiscounted future minimum operating lease payments and a reconciliation to the amount recorded as operating lease liabilities at June 30, 2025 were as follows:

(Dollars in thousands)

5 unchanged sentences

The weighted-average discount rate and remaining lease term for operating leases were as follows:

March 31, 2025 September 30, 2024

June 30, 2025 September 30, 2024

Weighted-average discount rate 2.67 % 2.45 %

1 unchanged sentence

The components of total lease costs for operating leases were as follows:

Three Months Ended March 31, Six Months Ended March 31,

Three Months Ended June 30, Nine Months Ended June 30,

(Dollars in thousands) 2025 2024 2025 2024

8 unchanged sentences

On August 25, 2023, the Company's Board of Directors announced a share repurchase program to repurchase up to an additional 7,000,000 shares of the Company's outstanding common stock on or before September 30, 2028.

During the six months ended March 31, 2025 and 2024, the Company repurchased 1,277,664 and 996,773 shares, respectively, as part of the share repurchase programs.

During the nine months ended June 30, 2025 and 2024, the Company repurchased 1,881,444 and 1,283,693 shares, respectively, as part of the share repurchase programs.

Under the repurchase programs, repurchased shares were retired and designated as authorized but unissued shares.

1 unchanged sentence

When the repurchase price is greater than the original issue proceeds, the excess is charged to retained earnings.

As of March 31, 2025, 5,722,336 shares of common stock remained available for repurchase.

For the six months ended March 31, 2025 and 2024, the Company also repurchased 66,446 and 122,452 shares, or $ 4.6 million and $ 5.8 million, of common stock, respectively, in settlement of employee tax withholding obligations due upon the vesting of restricted stock.

As of June 30, 2025, 5,118,556 shares of common stock remained available for repurchase.

For the nine months ended June 30, 2025 and 2024, the Company also repurchased 66,446 and 122,452 shares, or $ 4.6 million and $ 5.8 million, of common stock, respectively, in settlement of employee tax withholding obligations due upon the vesting of restricted stock.

Retirement of Treasury Stock.

1 unchanged sentence

When the repurchase price is greater than the original issue proceeds, the excess is charged to retained earnings.

The Company retired no shares of common stock held in treasury during the six months ended March 31, 2025 and 2024.

The Company retired no shares of common stock held in treasury during the nine months ended June 30, 2025 and 2024.

STOCK COMPENSATION

16 unchanged sentences

These stock awards vest in equal installments over eight years .

The following tables show the activity of share awards (including shares of restricted stock subject to vesting, fully-vested restricted stock, and PSUs) granted, exercised or forfeited under all of the Company's incentive plans during the six months ended March 31, 2025.

Number of Shares Weighted Average Fair Value at Grant

4 unchanged sentences

Forfeited or expired ( 2,606 ) 47.94

Nonvested shares outstanding, March 31, 2025 83,546 $ 47.75

Nonvested shares outstanding, June 30, 2025 81,995 $ 47.77

Restricted Stock Units

2 unchanged sentences

Forfeited or expired ( 3,939 ) 79.35

Nonvested shares outstanding, March 31, 2025 85,628 $ 79.51

Nonvested shares outstanding, June 30, 2025 84,371 $ 79.48

Number of Units Weighted Average Fair Value at Grant

3 unchanged sentences

Forfeited or expired — —

PSUs outstanding, March 31, 2025 142,366 $ 52.59

PSUs outstanding, June 30, 2025 142,366 $ 52.59

Compensation expense for share-based awards is recorded over the vesting period at the fair value of the award at the time of the grant.

1 unchanged sentence

The Company has elected to record forfeitures as they occur.

As of March 31, 2025, stock-based compensation expense not yet recognized in income totaled $ 11.7 million, which is expected to be recognized over a weighted average remaining period of 1.78 years.

The Company recorded an income tax expense of $ 22.2 million for the six months ended March 31, 2025, resulting in an effective tax rate of 17.38 %, compared to an income tax expense of $ 24.6 million, or an effective tax rate of 18.95 %, for the six months ended March 31, 2024.

As of June 30, 2025, stock-based compensation expense not yet recognized in income totaled $ 9.4 million, which is expected to be recognized over a weighted average remaining period of 1.65 years.

The Company recorded an income tax expense of $ 27.0 million for the nine months ended June 30, 2025, resulting in an effective tax rate of 15.44 %, compared to an income tax expense of $ 30.7 million, or an effective tax rate of 16.96 %, for the nine months ended June 30, 2024.

The Company’s effective tax rate was lower than the U.S.

2 unchanged sentences

The table below compares the income tax expense components for the periods presented.

Six Months Ended March 31,

Nine Months Ended June 30,

(Dollars in thousands) (As Restated)

4 unchanged sentences

Tax credit investments, net - federal ( 3,913 ) ( 12,556 )

Research tax credit ( 752 ) ( 602 )

IRC 162(m) nondeductible compensation 1,061 826

9 unchanged sentences

(As Restated) (As Restated) (As Restated) (As Restated)

Three Months Ended March 31, 2025 2024 2025 2024 2025 2024 2025 2024

Three Months Ended June 30, 2025 2024 2025 2024 2025 2024 2025 2024

Net interest income (1)

7 unchanged sentences

— — 12,681 13,615 232 164 12,913 13,779

(Loss) on sale of securities (1)

— — — — ( 7,228 ) — ( 7,228 ) —

(Loss) on divestitures (1)

— — — — ( 1,360 ) — ( 1,360 ) —

Secondary market revenue (1)

6 unchanged sentences

Revenue $ 117,697 $ 113,563 $ 73,543 $ 70,983 $ 4,515 $ 4,075 $ 195,755 $ 188,621

Six Months Ended March 31,

Nine Months Ended June 30,

Net interest income (1)

27 unchanged sentences

therefore, the Company measures progress in completing these services based upon the passage of time.

Revenue from contracts with customers did not generate significant contract assets and liabilities for the six months ended March 31, 2025.

Revenue from contracts with customers did not generate significant contract assets and liabilities for the nine months ended June 30, 2025.

Refund Transfer Product Fees.

36 unchanged sentences

(As Restated) (As Restated) (As Restated) (As Restated)

Three Months Ended March 31, 2025 2024 2025 2024 2025 2024 2025 2024

Three Months Ended June 30, 2025 2024 2025 2024 2025 2024 2025 2024

Net interest income $ 67,949 $ 69,328 $ 51,241 $ 52,932 $ 3,123 $ 490 $ 122,313 $ 122,750

6 unchanged sentences

Total deposits 5,823,684 6,190,419 87 13,592 181,475 227,505 6,005,246 6,431,516

Six Months Ended March 31,

Nine Months Ended June 30,

Net interest income $ 224,644 $ 205,530 $ 136,521 $ 142,631 $ 22,677 $ 22,150 $ 383,842 $ 370,311

17 unchanged sentences

The fair value of debt securities AFS, categorized primarily as Level 2, is recorded using prices obtained from independent asset pricing services that are based on observable transactions, but not quoted markets.

Management reviews the prices obtained from independent asset pricing services for unusual fluctuations and compares to current market trading activity.

reviews the prices obtained from independent asset pricing services for unusual fluctuations and compares to current market trading activity.

Equity Securities.

8 unchanged sentences

The Company considers this derivative instrument to be within Level 3 of the fair value hierarchy, as it utilizes inputs from sales or securitization transactions involving similar loans.

As of March 31, 2025 and September 30, 2024, the Company determined the derivatives had no fair value, respectively, thus eliminating the need for further disclosures regarding Level 3 inputs as outlined in ASC 820.

As of June 30, 2025 and September 30, 2024, the Company determined the derivatives had no fair value, respectively, thus eliminating the need for further disclosures regarding Level 3 inputs as outlined in ASC 820.

The following table summarizes the fair values of debt securities AFS and equity securities as they are measured at fair value on a recurring basis.

(Dollars in thousands) Total Level 1 Level 2 Level 3

March 31, 2025

June 30, 2025

Debt securities AFS

23 unchanged sentences

$ 11,828 $ — $ — $ —

(1) Equity securities at fair value are included within other assets on the Condensed Consolidated Statements of Financial Condition at March 31, 2025 and September 30, 2024.

(1) Equity securities at fair value are included within other assets on the Condensed Consolidated Statements of Financial Condition at June 30, 2025 and September 30, 2024.

(2) Consists of certain non-marketable equity securities that are measured at fair value using net asset value ("NAV") per share (or its equivalent) as a practical expedient and are excluded from the fair value hierarchy.

6 unchanged sentences

(Dollars in thousands) Total Level 1 Level 2 Level 3

March 31, 2025

June 30, 2025

Loans and leases, net individually evaluated for credit loss

9 unchanged sentences

(Dollars in thousands) Fair Value at

March 31, 2025

June 30, 2025

Fair Value at

5 unchanged sentences

Management discloses the estimated fair value of financial instruments, including assets and liabilities on and off the Condensed Consolidated Statements of Financial Condition, for which it is practicable to estimate fair value.

These fair value estimates were made at March 31, 2025 and September 30, 2024 based on relevant market information and information about financial instruments.

These fair value estimates were made at June 30, 2025 and September 30, 2024 based on relevant market information and information about financial instruments.

Fair value estimates are intended to represent the price at which an asset could be sold or a liability could be settled.

3 unchanged sentences

The following tables present the carrying amount and estimated fair value of the financial instruments held by the Company:

March 31, 2025

June 30, 2025

(Dollars in thousands) Carrying

15 unchanged sentences

Deposits 6,005,246 6,005,178 6,002,610 2,568 —

Overnight federal funds purchased 115,000 115,000 115,000 — —

Other short- and long-term borrowings 33,431 33,077 — 33,077 —

Accrued interest payable 742 742 742 — —

(1) Equity securities at fair value are included within other assets on the Condensed Consolidated Statements of Financial Condition at March 31, 2025.

(1) Equity securities at fair value are included within other assets on the Condensed Consolidated Statements of Financial Condition at June 30, 2025.

(2) Includes certain non-marketable equity securities that are measured at fair value using NAV per share (or its equivalent) as a practical expedient and are excluded from the fair value hierarchy.

23 unchanged sentences

SUBSEQUENT EVENTS

Management has evaluated subsequent events that occurred after March 31, 2025.

During this period, up to the filing date of this Quarterly Report on Form 10-Q, management did not identify any material subsequent events that would require recognition or disclosure in our Condensed Consolidated Financial Statements as of or for the quarter ended March 31, 2025.

Management has evaluated subsequent events that occurred after June 30, 2025.

RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS

The Company has restated its unaudited historical condensed consolidated financial statements as of March 31, 2024 and for the three and six months ended March 31, 2024 to correct for identified errors in its accounting for allowance for credit losses, interest income, provision for credit losses, and noninterest expense.

The Company has restated its unaudited historical condensed consolidated financial statements as of June 30, 2024 and for the three and nine months ended June 30, 2024 to correct for identified errors in its accounting for allowance for credit losses, interest income, provision for credit losses, and noninterest expense.

In addition, the Company has corrected other unrelated immaterial errors which were previously not recorded or not recorded in the appropriate period.

Prior period financial information restated for the three and six months ended March 31, 2024, was restated in the Form 10-K/A for the fiscal year ended September 30, 2024.

Prior period financial information restated for the three and nine months ended June 30, 2024, was restated in the Form 10-K/A for the fiscal year ended September 30, 2024.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements