PATHWARD FINANCIAL, INC. 10-Q

Item 1. Financial Statements. PATHWARD FINANCIAL, INC. AND SUBSIDIARIES Condensed Consolidated Statements of Financial Condition (Dollars in thousands, except per share data) June 30, 2025 September 30, 2024 ASSETS (Unaudited) (Audited) Cash and cash equivalents $ 258,343 $ 158,337 Securities available for sale, at fair value 1,367,340 1,741,221 Securities held to maturity, at amortized cost (fair value $ 25,771 and $ 30,236 , respectively) 30,273 33,092 Federal Reserve Bank and Federal Home Loan Bank Stock, at cost 29,451 36,014 Loans held for sale 49,767 691,688 Loans and leases 4,743,324 4,075,195 Allowance for credit losses ( 105,995 ) ( 71,765 ) Accrued interest receivable 39,996 31,385 Premises, furniture, and equipment, net 39,799 39,055 Rental equipment, net 181,370 205,339 Goodwill and intangible assets 311,193 326,094 Other assets 284,983 266,362 Total assets $ 7,229,844 $ 7,532,017 LIABILITIES AND STOCKHOLDERS’ EQUITY LIABILITIES Deposits $ 6,005,246 $ 5,875,085 Short-term borrowings 115,000 377,000 Long-term borrowings 33,431 33,354 Accrued expenses and other liabilities 258,019 424,389 Total liabilities 6,411,696 6,709,828 STOCKHOLDERS’ EQUITY 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, 23,023,823 and 24,851,122 shares issued, 22,953,608 and 24,847,353 shares outstanding at June 30, 2025 and September 30, 2024, respectively 230 248 Common stock, Nonvoting, $ 0.01 par value; 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 Retained earnings 337,321 337,058 Accumulated other comprehensive loss ( 159,709 ) ( 153,394 ) Treasury stock, at cost, 70,215 and 3,769 common shares at June 30, 2025 and September 30, 2024, respectively ( 4,882 ) ( 249 ) Total equity attributable to parent 819,004 822,466 Noncontrolling interest ( 856 ) ( 277 ) Total stockholders’ equity 818,148 822,189 Total liabilities and stockholders’ equity $ 7,229,844 $ 7,532,017 See Notes to Condensed Consolidated Financial Statements. 2 Table of Contents PATHWARD FINANCIAL, INC. AND SUBSIDIARIES Condensed Consolidated Statements of Operations (Unaudited) 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: Loans and leases, including fees $ 108,766 $ 107,762 $ 340,370 $ 324,699 Mortgage-backed securities 8,337 9,748 25,903 29,795 Other investments 6,489 8,323 27,679 33,222 123,592 125,833 393,952 387,716 Interest expense: Deposits 287 1,689 5,147 11,900 FHLB advances and other borrowings 992 1,394 4,963 5,505 1,279 3,083 10,110 17,405 Net interest income 122,313 122,750 383,842 370,311 Provision for credit loss 9,278 11,927 63,205 49,429 Net interest income after provision for credit loss 113,035 110,823 320,637 320,882 Noninterest income: Refund transfer product fees 9,846 9,111 42,919 38,475 Refund advance and other tax fee income 307 ( 67 ) 49,416 43,244 Card and deposit fees 37,342 33,408 97,201 99,502 Rental income 12,913 13,779 39,822 40,958 (Loss) on sale of securities — — ( 22,899 ) — Gain (loss) on divestitures — — 15,044 — Secondary market revenue 7,144 1,721 26,900 3,091 Gain on sale of other 394 2,954 2,007 6,119 Other income 5,496 4,965 18,934 16,188 Total noninterest income 73,442 65,871 269,344 247,577 Noninterest expense: Compensation and benefits 48,559 48,449 149,755 149,174 Refund transfer product expense 2,818 2,136 11,401 9,694 Refund advance expense ( 74 ) 47 1,225 1,923 Card processing 36,197 34,314 105,750 104,061 Occupancy and equipment expense 10,633 9,070 30,646 27,211 Operating lease equipment depreciation 11,569 10,465 34,775 31,312 Legal and consulting 11,094 5,410 22,197 16,443 Intangible amortization 798 983 2,693 3,207 Impairment expense 1,077 999 2,590 3,012 Other expense 16,651 13,637 54,264 41,292 Total noninterest expense 139,322 125,510 415,296 387,329 Income before income tax expense 47,155 51,184 174,685 181,130 Income tax expense 4,795 6,103 26,966 30,726 Net income before noncontrolling interest 42,360 45,081 147,719 150,404 Net income attributable to noncontrolling interest 213 212 650 718 Net income attributable to parent $ 42,147 $ 44,869 $ 147,069 $ 149,686 Earnings per common share: Basic $ 1.83 $ 1.78 $ 6.20 $ 5.86 Diluted $ 1.81 $ 1.78 $ 6.17 $ 5.85 See Notes to Condensed Consolidated Financial Statements. 3 Table of Contents PATHWARD FINANCIAL, INC. AND SUBSIDIARIES Condensed Consolidated Statements of Comprehensive Income (Unaudited) 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 Other comprehensive income (loss): Change in net unrealized gain (loss) on debt securities 6,028 ( 1,463 ) ( 30,795 ) 63,659 Net loss realized on debt securities — — 22,899 — 6,028 ( 1,463 ) ( 7,896 ) 63,659 Unrealized gain (loss) on currency translation 2,069 ( 297 ) 30 ( 260 ) Deferred income tax effect 1,495 ( 338 ) ( 1,551 ) 15,948 Total other comprehensive income (loss) 6,602 ( 1,422 ) ( 6,315 ) 47,451 Total comprehensive income 48,962 43,659 141,404 197,855 Total comprehensive income attributable to noncontrolling interest 213 212 650 718 Comprehensive income attributable to parent $ 48,749 $ 43,447 $ 140,754 $ 197,137 See Notes to Condensed Consolidated Financial Statements. 4 Table of Contents PATHWARD FINANCIAL, INC. AND SUBSIDIARIES Condensed Consolidated Statements of Changes in Stockholders' Equity (Unaudited) Three Months Ended (Dollars in thousands, except per share data) Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Treasury Stock Total Pathward Financial, Inc. Stockholders’ Equity Noncontrolling interest Total Stockholders’ Equity 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) — — ( 1,151 ) — — ( 1,151 ) — ( 1,151 ) Repurchases of common stock ( 5 ) 5 ( 45,450 ) — — ( 45,450 ) — ( 45,450 ) Stock compensation — 2,151 — — — 2,151 — 2,151 Total other comprehensive income — — — 6,602 — 6,602 — 6,602 Net income — — 42,147 — — 42,147 213 42,360 Net distribution to noncontrolling interest — — — — — — ( 411 ) ( 411 ) Balance, June 30, 2025 $ 230 $ 646,044 $ 337,321 $ ( 159,709 ) $ ( 4,882 ) $ 819,004 $ ( 856 ) $ 818,148 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 ) Repurchases of common stock ( 3 ) 3 ( 15,150 ) — — ( 15,150 ) — ( 15,150 ) Stock compensation — 1,866 — — — 1,866 — 1,866 Total other comprehensive loss — — — ( 1,422 ) — ( 1,422 ) — ( 1,422 ) Net income (Restated) — — 44,869 — — 44,869 212 45,081 Net distribution to noncontrolling interest — — — — — — ( 298 ) ( 298 ) Balance, June 30, 2024 (As Restated) $ 251 $ 636,284 $ 326,040 $ ( 207,992 ) $ ( 6,181 ) $ 748,402 $ ( 506 ) $ 747,896 Nine Months Ended (Dollars in thousands, except per share data) Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Treasury Stock Total Pathward Financial, Inc. Stockholders’ Equity Noncontrolling interest Total Stockholders’ Equity Balance, September 30, 2024 (As Restated) $ 248 $ 638,803 $ 337,058 $ ( 153,394 ) $ ( 249 ) $ 822,466 $ ( 277 ) $ 822,189 Cash dividends declared on common stock ($ 0.15 per share) — — ( 3,542 ) — — ( 3,542 ) — ( 3,542 ) Repurchases of common stock ( 18 ) 18 ( 143,264 ) — ( 4,633 ) ( 147,897 ) — ( 147,897 ) Stock compensation — 7,223 — — — 7,223 — 7,223 Total other comprehensive loss — — — ( 6,315 ) — ( 6,315 ) — ( 6,315 ) Net income — — 147,069 — — 147,069 650 147,719 Net distribution to noncontrolling interest — — — — — — ( 1,229 ) ( 1,229 ) Balance, June 30, 2025 $ 230 $ 646,044 $ 337,321 $ ( 159,709 ) $ ( 4,882 ) $ 819,004 $ ( 856 ) $ 818,148 Balance, September 30, 2023 (As Restated) $ 262 $ 628,500 $ 246,377 $ ( 255,443 ) $ ( 344 ) $ 619,352 $ ( 1,005 ) $ 618,347 Cash dividends declared on common stock ($ 0.15 per share) — — ( 3,824 ) — — ( 3,824 ) — ( 3,824 ) Issuance of common stock due to restricted stock 3 — — — — 3 — 3 Repurchases of common stock ( 14 ) 14 ( 65,676 ) — ( 5,837 ) ( 71,513 ) — ( 71,513 ) Stock compensation — 7,770 — — — 7,770 — 7,770 Total other comprehensive income — — — 47,451 — 47,451 — 47,451 Joint venture membership interest divestiture — — ( 523 ) — — ( 523 ) — ( 523 ) Net income (Restated) — — 149,686 — — 149,686 718 150,404 Net distribution to noncontrolling interest — — — — — — ( 219 ) ( 219 ) Balance, June 30, 2024 (As Restated) $ 251 $ 636,284 $ 326,040 $ ( 207,992 ) $ ( 6,181 ) $ 748,402 $ ( 506 ) $ 747,896 See Notes to Condensed Consolidated Financial Statements. 5 Table of Contents PATHWARD FINANCIAL, INC. AND SUBSIDIARIES Condensed Consolidated Statements of Cash Flows (Unaudited) Nine Months Ended June 30, (Dollars in thousands) 2025 2024 (As Restated) Cash flows from operating activities: Net income before noncontrolling interest $ 147,719 $ 150,404 Adjustments to reconcile net income to net cash provided by (used in) operating activities: Depreciation and amortization 45,423 43,832 Provision for credit loss 63,205 49,429 Provision for deferred taxes 16,256 12,720 Originations of loans held for sale ( 1,925,438 ) ( 1,426,973 ) Proceeds from sales of loans held for sale 2,014,236 1,468,162 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) on divestitures ( 15,044 ) — Net realized (gain) on other ( 2,007 ) ( 6,119 ) Impairment on rental equipment 2,590 2,013 Net change in accrued interest receivable ( 8,611 ) ( 8,473 ) Net change in other assets ( 29,182 ) ( 13,989 ) Net change in accrued expenses and other liabilities ( 163,623 ) 51,942 Stock compensation 7,223 7,770 Net cash provided by operating activities 146,955 345,689 Cash flows from investing activities: Purchases of securities available for sale ( 2,280 ) — Proceeds from sales of securities available for sale 217,883 — Proceeds from maturities of and principal collected on securities available for sale 127,261 141,801 Proceeds from maturities of and principal collected on securities held to maturity 2,676 2,430 Purchases of Federal Reserve Bank and Federal Home Loan Bank stock ( 210,159 ) ( 276,025 ) Redemption of Federal Reserve Bank and Federal Home Loan Bank stock 216,722 279,787 Purchases of loans and leases ( 193,795 ) ( 229,912 ) Net change in loans and leases ( 587,597 ) 119,964 Purchases of premises, furniture, and equipment ( 8,339 ) ( 5,784 ) Purchases of rental equipment ( 113,018 ) ( 221,681 ) Proceeds from sales of rental equipment 20,692 7,302 Net change in rental equipment 389 408 Proceeds from divestitures, net of transaction costs 608,455 — Proceeds from sale of other assets 408 6,466 Proceeds from loans held for sale previously classified as portfolio loans 146,158 — Net cash provided by (used in) investing activities 225,456 ( 175,244 ) Cash flows from financing activities: Net change in deposits 142,234 ( 157,666 ) Net change in short-term borrowings ( 262,001 ) ( 13,000 ) Principal payments on other liabilities — ( 621 ) Dividends paid on common stock ( 3,542 ) ( 3,824 ) Issuance of common stock due to restricted stock — 3 Repurchases of common stock ( 147,897 ) ( 71,513 ) Investment by (distributions to) noncontrolling interest ( 1,229 ) ( 219 ) Net cash (used in) financing activities ( 272,435 ) ( 246,840 ) Effect of exchange rate changes on cash 30 ( 259 ) Net change in cash and cash equivalents 100,006 ( 76,654 ) Cash and cash equivalents at beginning of fiscal year 158,337 375,580 Cash and cash equivalents at end of fiscal period $ 258,343 $ 298,926 6 Table of Contents 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: Cash paid during the period for: Interest $ 9,939 $ 15,988 Income taxes 14,345 13,996 Franchise and other taxes 580 620 Supplemental schedule of non-cash investing activities: Transfers Held for sale to loans and leases $ 27,155 $ 8,403 Loans and leases to held for sale 130,011 — Loans and leases to rental equipment 3,683 3,847 Rental equipment to loan and leases 83,309 187,505 Recognition of operating lease ROU assets, net of measurements — 654 Joint venture membership interest divestiture — 523 See Notes to Condensed Consolidated Financial Statements. 7 Table of Contents PATHWARD FINANCIAL, INC. AND SUBSIDIARIES Notes to Condensed Consolidated Financial Statements NOTE 1. BASIS OF PRESENTATION The interim unaudited Condensed Consolidated Financial Statements contained herein should be read in conjunction with the audited consolidated financial statements and accompanying notes to the consolidated financial statements for the fiscal year ended September 30, 2024 included in Pathward Financial, Inc.’s ("Pathward Financial" or the “Company") Annual Report on Form 10-K, as amended by Amendment No. 1 thereto, filed with the Securities and Exchange Commission ("SEC") on August 29, 2025 (the "Form 10-K/A"). Accordingly, footnote disclosures which would substantially duplicate the disclosures contained in the audited consolidated financial statements have been omitted. The financial information of the Company included herein has been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial reporting and has been prepared pursuant to the rules and regulations for reporting on Form 10-Q and Rule 10-01 of Regulation S-X. 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 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 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. There were no reclassifications of fiscal year amounts or prior period amounts as a result of this change in financial statement caption description. NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RECENTLY ADOPTED ACCOUNTING STANDARDS UPDATES ("ASU") Significant accounting policies in effect and disclosed within the Company’s most recent audited consolidated financial statements as of September 30, 2024 remain substantially unchanged. The following ASU became effective for the Company on October 1, 2024, and did not have a material impact on the Company’s significant accounting policies or Condensed Consolidated Financial Statements: ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. This ASU improves reportable segment disclosures primarily by enhancing disclosure requirements about significant segment expenses and additional interim disclosure requirements. The amendments will first be applied to the Company's annual financial statements for the year ending September 30, 2025 using a retrospective transition method. This ASU impacts disclosure only, and therefore does not have an impact on our consolidated financial statements. The following ASUs have been issued and are considered applicable to the Company but have not yet been adopted. ASU 2023-09, Income Taxes (ASC 740): Improvements to Income Tax Disclosures . This ASU requires enhanced income tax disclosures primarily related to the rate reconciliation and income taxes paid information to provide further transparency surrounding the Company’s income tax position. The amendments in this ASU will be effective for the Company beginning on October 1, 2025. This ASU impacts annual income tax disclosures only. The Company is currently evaluating the impact of such amendments to our Income Tax disclosures. 8 Table of Contents ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures . This ASU requires entities to disclose specified information about certain costs and expenses within relevant expense captions in both annual and interim financial reporting. If costs and expenses do not fall within one of the disaggregated captions, qualitative description is required. 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. The Company is currently evaluating the impact of this ASU on required annual and interim disclosures. NOTE 3. DIVESTITURES On October 31, 2024, the Company completed the sale of substantially all of the assets and liabilities related to the Bank's commercial insurance premium finance business, a component of the Company's Commercial segment, pursuant to the Asset Purchase and Sale Agreement (the "Purchase Agreement") dated August 28, 2024 with Honor Capital Corporation, a Florida corporation (the "Purchaser"), the successor by assignment to AFS IBEX Financial Services, LLC, and Honor Capital Holdings, LLC as guarantor. The purchase price at closing was based on the net asset value of the assets purchased and liabilities assumed pursuant to the Purchase Agreement plus a $ 31.2 million premium. The Company has summarized the results of the transaction as follows: (Dollars in thousands) December 31, 2024 Settlement Adjustments June 30, 2025 Assets Purchased and Liabilities Assumed Cash and cash equivalents $ 4,686 $ — $ 4,686 Loans 594,541 ( 1,360 ) 593,181 Premises, furniture, and equipment, net 484 — 484 Total assets purchased $ 599,711 $ ( 1,360 ) $ 598,351 Deposits $ 16,760 $ — $ 16,760 Accrued expenses and other liabilities 1,158 120 1,278 Total liabilities assumed $ 17,918 $ 120 $ 18,038 Net assets purchased $ 581,793 $ ( 1,480 ) $ 580,313 Consideration paid at close 603,290 8,223 611,513 Consideration due 9,703 ( 9,703 ) — Purchase price 612,993 ( 1,480 ) 611,513 Premium on transaction 31,200 — 31,200 Other adjustments: Goodwill derecognition ( 11,577 ) — ( 11,577 ) Intangible derecognition ( 631 ) — ( 631 ) Building lease derecognition 471 — 471 Deferred loan origination cost derecognition — ( 1,360 ) ( 1,360 ) Transaction costs ( 3,059 ) — ( 3,059 ) Total other adjustments ( 14,796 ) ( 1,360 ) ( 16,156 ) Gain on divestitures $ 16,404 $ ( 1,360 ) $ 15,044 9 Table of Contents After final settlement adjustments, the sale resulted in an overall gain of $ 15.0 million before tax that was recognized within noninterest income on the Company's Condensed Consolidated Statements of Operations. The settlement adjustments during the three months ended March 31, 2025 resulted in a $ 1.4 million decrease of the previously recognized gain as of December 31, 2024 as a result of certain deferred loan origination costs that were excluded from the final settlement. See Note 8. Goodwill and Intangible Assets and Note 9. Operating Lease Right-of-Use Assets and Liabilities to the Condensed Consolidated Financial Statements for further information on the amounts included in the divestiture. NOTE 4. SECURITIES The amortized cost, gross unrealized gains and losses and estimated fair values of debt securities available for sale ("AFS") and held to maturity ("HTM") are presented below. (Dollars in thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized (Losses) Fair Value Debt Securities AFS June 30, 2025 Corporate securities $ 25,000 $ — $ ( 3,875 ) $ 21,125 SBA securities 11,791 — ( 1,108 ) 10,683 Obligations of states and political subdivisions 162 — ( 1 ) 161 Non-bank qualified obligations of states and political subdivisions 218,328 23 ( 28,806 ) 189,545 Asset-backed securities 142,963 11 ( 2,782 ) 140,192 Mortgage-backed securities 1,180,069 17 ( 174,452 ) 1,005,634 Total debt securities AFS $ 1,578,313 $ 51 $ ( 211,024 ) $ 1,367,340 September 30, 2024 Corporate securities $ 25,000 $ — $ ( 5,250 ) $ 19,750 SBA securities 86,036 — ( 4,101 ) 81,935 Obligations of states and political subdivisions 501 — ( 21 ) 480 Non-bank qualified obligations of states and political subdivisions 246,233 44 ( 28,287 ) 217,990 Asset-backed securities 192,979 337 ( 3,618 ) 189,698 Mortgage-backed securities 1,393,549 84 ( 162,265 ) 1,231,368 Total debt securities AFS $ 1,944,298 $ 465 $ ( 203,542 ) $ 1,741,221 Debt Securities HTM June 30, 2025 Non-bank qualified obligations of states and political subdivisions $ 28,314 $ — $ ( 4,263 ) $ 24,051 Mortgage-backed securities 1,959 — ( 239 ) 1,720 Total debt securities HTM $ 30,273 $ — $ ( 4,502 ) $ 25,771 September 30, 2024 Non-bank qualified obligations of states and political subdivisions $ 31,060 $ — $ ( 2,668 ) $ 28,392 Mortgage-backed securities 2,032 — ( 188 ) 1,844 Total debt securities HTM $ 33,092 $ — $ ( 2,856 ) $ 30,236 10 Table of Contents Gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities have been in a continuous loss position, were as follows: LESS THAN 12 MONTHS OVER 12 MONTHS TOTAL (Dollars in thousands) Fair Value Gross Unrealized (Losses) Fair Value Gross Unrealized (Losses) Fair Value Gross Unrealized (Losses) Debt Securities AFS 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 ) Asset-backed securities 66,794 ( 725 ) 68,015 ( 2,057 ) 134,809 ( 2,782 ) Mortgage-backed securities 13,041 ( 111 ) 990,596 ( 174,341 ) 1,003,637 ( 174,452 ) Total debt securities AFS $ 79,996 $ ( 837 ) $ 1,278,012 $ ( 210,187 ) $ 1,358,008 $ ( 211,024 ) September 30, 2024 Corporate securities $ — $ — $ 19,750 $ ( 5,250 ) $ 19,750 $ ( 5,250 ) SBA securities — — 81,935 ( 4,101 ) 81,935 ( 4,101 ) Obligations of state and political subdivisions — — 280 ( 21 ) 280 ( 21 ) Non-bank qualified obligations of states and political subdivisions — — 215,956 ( 28,287 ) 215,956 ( 28,287 ) Asset-backed securities 52,101 ( 176 ) 88,576 ( 3,442 ) 140,677 ( 3,618 ) Mortgage-backed securities 2,377 ( 15 ) 1,215,781 ( 162,250 ) 1,218,158 ( 162,265 ) Total debt securities AFS $ 54,478 $ ( 191 ) $ 1,622,278 $ ( 203,351 ) $ 1,676,756 $ ( 203,542 ) Debt Securities HTM June 30, 2025 Non-bank qualified obligations of states and political subdivisions $ — $ — $ 24,051 $ ( 4,263 ) $ 24,051 $ ( 4,263 ) Mortgage-backed securities — — 1,720 ( 239 ) 1,720 ( 239 ) Total debt securities HTM $ — $ — $ 25,771 $ ( 4,502 ) $ 25,771 $ ( 4,502 ) September 30, 2024 Non-bank qualified obligations of states and political subdivisions $ — $ — $ 28,392 $ ( 2,668 ) $ 28,392 $ ( 2,668 ) Mortgage-backed securities — — 1,844 ( 188 ) 1,844 ( 188 ) Total debt securities HTM $ — $ — $ 30,236 $ ( 2,856 ) $ 30,236 $ ( 2,856 ) 11 Table of Contents 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. The sale of debt securities AFS in the second quarter of fiscal 2025 stemmed from the decision to offset the gain on the sale of the transportation portfolio within working capital. Individual securities were identified for sale upon close of the transactions in order to reposition the debt securities AFS portfolio. 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 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. Certain securities have call features which allow the issuer to call the security prior to maturity. Expected maturities may differ from contractual maturities in MBS because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Therefore, MBS are not included in the maturity categories in the following maturity summary. The expected maturities of certain SBA securities may differ from contractual maturities because the borrowers may have the right to prepay the obligation. However, certain prepayment penalties may apply. (Dollars in thousands) June 30, 2025 September 30, 2024 Debt Securities AFS Amortized Cost Fair Value Amortized Cost Fair Value Due in one year or less $ 380 $ 382 $ 1,826 $ 1,796 Due after one year through five years 1,712 1,732 14,772 14,211 Due after five years through ten years 27,883 24,013 70,894 63,636 Due after ten years 368,269 335,580 463,257 430,210 398,244 361,707 550,749 509,853 Mortgage-backed securities 1,180,069 1,005,633 1,393,549 1,231,368 Total debt securities AFS $ 1,578,313 $ 1,367,340 $ 1,944,298 $ 1,741,221 Debt Securities HTM Due after ten years $ 28,314 $ 24,051 $ 31,060 $ 28,392 28,314 24,051 31,060 28,392 Mortgage-backed securities 1,959 1,720 2,032 1,844 Total debt securities HTM $ 30,273 $ 25,771 $ 33,092 $ 30,236 Federal Reserve Bank ("FRB") Stock. The Bank is required by federal law to subscribe to capital stock (divided into shares of $100 each) as a member of the FRB of Minneapolis with an amount equal to six per centum of the paid-up capital stock and surplus. 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 June 30, 2025 and September 30, 2024. These equity securities are 'restricted' in that they can only be owned by member banks. Federal Home Loan Bank ("FHLB") Stock. The Company's borrowings from the FHLB are secured by specific investment securities. Such advances can be made pursuant to several different credit programs, each of which has its own interest rate and range of maturities. The investments in the FHLB stock are required investments related to the Company's membership in and current borrowings from the FHLB of Des Moines. The investments in the FHLB of Des Moines could be adversely impacted by the financial operations of the FHLB and actions of their regulator, the Federal Housing Finance Agency. 12 Table of Contents 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 $ 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. Therefore, FRB and FHLB stocks are less liquid than other marketable equity securities, and the cost approximates fair value. Equity Securities. 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 $ 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 nine months ended June 30, 2025. Equity Securities Impairment. The Company evaluates impairment for investments held at cost on at least an annual basis based on the ultimate recoverability of the par value. 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 nine months ended June 30, 2025 and 2024. 13 Table of Contents NOTE 5. LOANS AND LEASES, NET Loans and leases consist of the following: (Dollars in thousands) June 30, 2025 September 30, 2024 Term lending $ 2,003,699 $ 1,554,641 Asset-based lending 610,852 471,897 Factoring 241,024 362,295 Lease financing 134,214 152,174 SBA/USDA 674,902 568,628 Other commercial finance 153,321 185,964 Commercial finance 3,818,012 3,295,599 Consumer finance 226,380 248,800 Tax services 37,419 8,825 Warehouse finance 664,110 517,847 Total loans and leases 4,745,921 4,071,071 Net deferred loan origination costs (fees) ( 2,597 ) 4,124 Total gross loans and leases 4,743,324 4,075,195 Allowance for credit losses ( 105,995 ) ( 71,765 ) Total loans and leases, net $ 4,637,329 $ 4,003,430 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. See Note 3. Divestitures to the Condensed Consolidated Financial Statements for further information on the sale of the Company's commercial insurance premium finance business. 14 Table of Contents Loans purchased and sold by portfolio segment, including participation interests, were as follows: Three Months Ended June 30, Nine Months Ended June 30, (Dollars in thousands) 2025 2024 2025 2024 Loans Purchased Loans held for investment: Commercial finance $ 1,271 $ 11,000 $ 20,811 $ 11,000 Warehouse finance 25,873 55,821 172,984 218,912 Total purchases $ 27,144 $ 66,821 $ 193,795 $ 229,912 Loans Sold Loans held for sale: Commercial finance $ 100,909 $ 24,173 $ 349,378 $ 49,218 Consumer finance 505,779 474,991 1,811,016 1,418,944 Total sales $ 606,688 $ 499,164 $ 2,160,394 $ 1,468,162 Leasing Portfolio. The net investment in direct financing and sales-type leases was comprised of the following: (Dollars in thousands) June 30, 2025 September 30, 2024 Minimum lease payments receivable $ 144,134 $ 162,757 Unguaranteed residual assets 7,284 9,300 Unamortized initial direct costs 72 102 Unearned income ( 17,204 ) ( 19,883 ) Total net investment in direct financing and sales-type leases $ 134,286 $ 152,276 The components of total lease income were as follows: Three Months Ended June 30, Nine Months Ended June 30, (Dollars in thousands) 2025 2024 2025 2024 Interest income - loans and leases Interest income on net investments in direct financing and sales-type leases $ 2,444 $ 2,908 $ 8,431 $ 8,869 Leasing and equipment finance noninterest income Lease income from operating lease payments 12,751 13,589 39,130 40,449 Other (1) 747 1,051 3,193 2,644 Total leasing and equipment finance noninterest income 13,498 14,640 42,323 43,093 Total lease income $ 15,942 $ 17,548 $ 50,754 $ 51,962 (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. 15 Table of Contents 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) Remaining in 2025 $ 15,714 2026 49,550 2027 35,162 2028 22,288 2029 13,579 Thereafter 7,841 Total undiscounted future minimum lease payments receivable for direct financing and sales-type leases 144,134 Third-party residual value guarantees — 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 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. Since early 2025, global markets and the U.S. economy have also experienced disruption and volatility resulting from tariffs and other policies of the U.S. administration, which may continue during the remainder of 2025. Management continues to evaluate the loan and lease portfolio in order to assess the impact on repayment sources and underlying collateral that could result in additional losses and the impact to our customers and businesses as a result of these factors impacting the economy and will refine its estimate as developments occur and more information becomes available. 16 Table of Contents Activity in the allowance for credit losses by portfolio segment was as follows: (Dollars in thousands) Beginning Balance Provision (Reversal) Charge-offs Recoveries Ending Balance Three Months Ended June 30, 2025 Allowance for credit losses: Term lending $ 26,219 $ 3,514 $ ( 1,333 ) $ 976 $ 29,376 Asset-based lending 2,030 5,844 ( 539 ) — 7,335 Factoring 4,934 516 ( 464 ) 391 5,377 Lease financing 1,243 219 ( 344 ) 12 1,130 SBA/USDA 4,021 1,427 ( 421 ) 1 5,028 Other commercial finance 384 ( 195 ) — — 189 Commercial finance 38,831 11,325 ( 3,101 ) 1,380 48,435 Consumer finance 29,635 2,613 ( 6,381 ) 600 26,467 Tax services 33,781 ( 4,728 ) ( 554 ) 1,930 30,429 Warehouse finance 643 21 — — 664 Total loans and leases 102,890 9,231 ( 10,036 ) 3,910 105,995 Unfunded commitments (1) 851 47 — — 898 Total $ 103,741 $ 9,278 $ ( 10,036 ) $ 3,910 $ 106,893 (As Restated) Three Months Ended June 30, 2024 Beginning Balance Provision (Reversal) Charge-offs Recoveries Ending Balance Allowance for credit losses: Term lending $ 28,627 $ 5,962 $ ( 4,628 ) $ 698 $ 30,659 Asset-based lending 1,215 10 — 9 1,234 Factoring 6,814 1,369 ( 2,389 ) 18 5,812 Lease financing 1,551 ( 86 ) — 29 1,494 Insurance premium finance 1,409 480 ( 263 ) 26 1,652 SBA/USDA 2,942 358 ( 456 ) — 2,844 Other commercial finance 1,720 ( 321 ) — — 1,399 Commercial finance 44,278 7,772 ( 7,736 ) 780 45,094 Consumer finance 35,081 7,145 ( 10,009 ) 351 32,568 Tax services 31,528 ( 3,285 ) ( 820 ) 1,230 28,653 Warehouse finance 395 55 — — 450 Total loans and leases 111,282 11,687 ( 18,565 ) 2,361 106,765 Unfunded commitments (1) 743 240 — — 983 Total $ 112,025 $ 11,927 $ ( 18,565 ) $ 2,361 $ 107,748 (1) Reserve for unfunded commitments is recognized within other liabilities on the Condensed Consolidated Statements of Financial Condition. 17 Table of Contents (Dollars in thousands) Beginning Balance Provision (Reversal) Charge-offs Recoveries Ending Balance Nine Months Ended June 30, 2025 Allowance for credit losses: Term lending $ 30,394 $ 12,187 $ ( 15,916 ) $ 2,711 $ 29,376 Asset-based lending 1,356 6,690 ( 711 ) — 7,335 Factoring 5,757 ( 421 ) ( 634 ) 675 5,377 Lease financing 1,189 1,346 ( 1,426 ) 21 1,130 Insurance premium finance — 91 ( 93 ) 2 — SBA/USDA 3,273 3,033 ( 1,327 ) 49 5,028 Other commercial finance 607 ( 418 ) — — 189 Commercial finance 42,576 22,508 ( 20,107 ) 3,458 48,435 Consumer finance 28,669 17,597 ( 21,362 ) 1,563 26,467 Tax services 2 22,751 ( 1,295 ) 8,971 30,429 Warehouse finance 518 146 — — 664 Total loans and leases 71,765 63,002 ( 42,764 ) 13,992 105,995 Unfunded commitments (1) 695 203 — — 898 Total $ 72,460 $ 63,205 $ ( 42,764 ) $ 13,992 $ 106,893 (As Restated) Nine Months Ended June 30, 2024 Beginning Balance Provision (Reversal) Charge-offs Recoveries Ending Balance Allowance for credit losses: Term lending $ 25,686 $ 18,087 $ ( 14,925 ) $ 1,811 $ 30,659 Asset-based lending 2,738 ( 1,754 ) — 250 1,234 Factoring 6,566 1,497 ( 2,424 ) 173 5,812 Lease financing 3,302 ( 1,867 ) ( 125 ) 184 1,494 Insurance premium finance 2,637 ( 291 ) ( 923 ) 229 1,652 SBA/USDA 2,962 338 ( 456 ) — 2,844 Other commercial finance 3,089 ( 1,690 ) — — 1,399 Commercial finance 46,980 14,320 ( 18,853 ) 2,647 45,094 Consumer finance 49,496 11,033 ( 28,932 ) 971 32,568 Tax services 2 23,292 ( 1,965 ) 7,324 28,653 Warehouse finance 377 73 — — 450 Total loans and leases 96,855 48,718 ( 49,750 ) 10,942 106,765 Unfunded commitments (1) 272 711 — — 983 Total $ 97,127 $ 49,429 $ ( 49,750 ) $ 10,942 $ 107,748 (1) Reserve for unfunded commitments is recognized within other liabilities on the Condensed Consolidated Statements of Financial Condition. 18 Table of Contents 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) June 30, 2025 September 30, 2024 Term lending $ 33,789 $ 15,491 Asset-based lending 9,517 — Factoring 1,108 — Lease financing 4,079 5,300 SBA/USDA 6,310 1,419 Commercial finance (1) 54,803 22,210 Total $ 54,803 $ 22,210 (1) For commercial finance, collateral dependent financial assets have collateral in the form of cash, equipment, or other business assets. Management has identified certain structured finance credits for alternative energy projects in which a substantial cash collateral account has been established to mitigate credit risk. 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 $ 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: Pass - A pass asset is of sufficient quality in terms of repayment, collateral and management to preclude a special mention or an adverse rating. Watch - A watch asset is generally a credit performing well under current terms and conditions but with identifiable weakness meriting additional scrutiny and corrective measures. Watch is not a regulatory classification but can be used to designate assets that are exhibiting one or more weaknesses that deserve management’s attention. These assets are of better quality than special mention assets. Special Mention - A special mention asset is a credit with potential weaknesses deserving management’s close attention and, if left uncorrected, may result in deterioration of the repayment prospects for the asset. Special mention assets are not adversely classified and do not expose an institution to sufficient risk to warrant adverse classification. Special mention is a temporary status with aggressive credit management required to garner adequate progress and move to watch or higher. The adverse classifications are as follows: Substandard - A substandard asset is inadequately protected by the net worth and/or repayment ability or by a weak collateral position. Assets so classified will have well-defined weaknesses creating a distinct possibility the Bank will sustain some loss if the weaknesses are not corrected. Loss potential does not have to exist for an asset to be classified as substandard. Doubtful - A doubtful asset has weaknesses similar to those classified substandard, with the degree of weakness causing the likely loss of some principal in any reasonable collection effort. Due to pending factors, the asset’s classification as loss is not yet appropriate. Loss - A loss asset is considered uncollectible and of such little value that the asset’s continuance on the Bank’s balance sheet is no longer warranted. This classification does not necessarily mean an asset has no recovery or salvage value leaving room for future collection efforts. 19 Table of Contents Loans and leases, or portions thereof, are generally charged off when collection of principal becomes doubtful. Typically, this is associated with a delay or shortfall in payments of 120 days or more for consumer credit products and leases, and 90 days or more for commercial finance loans. Action is taken to charge off electronic return originator ("ERO") loans if such loans have not been collected by the end of June and refund advance loans if such loans have not been collected by the end of the calendar year. The Company individually evaluates loans and leases that do not share similar risk characteristics with other financial assets, which generally means loans and leases identified as modifications or loans and leases on nonaccrual status. The Company recognizes that concentrations of credit may naturally occur and may take the form of a large volume of related loans and leases to an individual, a specific industry, or a geographic location. Credit concentration is a direct, indirect, or contingent obligation that has a common bond where the aggregate exposure equals or exceeds a certain percentage of the Company’s Tier 1 Capital plus the allowable Allowance for Credit Losses. The Company has various portfolios of consumer finance 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 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 $ 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: Amortized Cost Basis (Dollars in thousands) Term Loans and Leases by Origination Year Revolving Loans and Leases Total June 30, 2025 2025 2024 2023 2022 2021 Prior Term lending Pass $ 639,497 $ 447,978 $ 307,564 $ 106,578 $ 65,242 $ 43,752 $ — $ 1,610,611 Watch 32,947 49,641 77,918 7,643 17,657 11,035 — 196,841 Special mention — 56,703 5,349 645 8,978 80 — 71,755 Substandard 1,671 19,994 40,877 20,882 14,293 20,438 — 118,155 Doubtful — 229 776 3,647 1,572 113 — 6,337 Total 674,115 574,545 432,484 139,395 107,742 75,418 — 2,003,699 Current period charge-offs — 7,637 4,365 2,704 851 359 — 15,916 Asset-based lending Pass — — — — — — 343,417 343,417 Watch — — — — — — 249,272 249,272 Special mention — — — — — — 7,641 7,641 Substandard — — — — — — 5,643 5,643 Doubtful — — — — — — 4,879 4,879 Total — — — — — — 610,852 610,852 Current period charge-offs — — — — — — 711 711 Factoring Pass — — — — — — 192,550 192,550 Watch — — — — — — 43,120 43,120 Special mention — — — — — — 1,624 1,624 Substandard — — — — — — 2,387 2,387 Doubtful — — — — — — 1,343 1,343 Total — — — — — — 241,024 241,024 Current period charge-offs — — — — — — 634 634 Lease financing Pass 25,064 29,883 38,619 6,140 1,741 5,183 — 106,630 Watch 3,967 6,925 781 1,080 1,812 355 — 14,920 Special mention — — — — 211 — — 211 Substandard — — 5,545 1,607 4,180 970 — 12,302 Doubtful — — 150 — 1 — — 151 Total 29,031 36,808 45,095 8,827 7,945 6,508 — 134,214 20 Table of Contents Current period charge-offs — — 320 — 1,005 101 — 1,426 Insurance premium finance Current period charge-offs — 62 31 — — — — 93 SBA/USDA Pass 71,249 102,629 171,232 155,222 18,905 39,753 — 558,990 Watch 19,885 6,217 241 9,735 998 3,779 — 40,855 Special mention 63 255 — 2,538 329 2,156 — 5,341 Substandard 612 2,048 17,463 12,553 2,864 32,471 — 68,011 Doubtful — 884 693 — — 128 — 1,705 Total 91,809 112,033 189,629 180,048 23,096 78,287 — 674,902 Current period charge-offs — — 171 90 55 1,011 — 1,327 Other commercial finance Pass 8,385 62,895 2,120 127 12,122 64,771 — 150,420 Watch — — 2,436 — — — — 2,436 Substandard — — 465 — — — — 465 Total 8,385 62,895 5,021 127 12,122 64,771 — 153,321 Current period charge-offs — — — — — — — — Warehouse finance Pass — — — — — — 664,110 664,110 Total — — — — — — 664,110 664,110 Current period charge-offs — — — — — — — — Total loans and leases Pass 744,195 643,385 519,535 268,067 98,010 153,459 1,200,077 3,626,728 Watch 56,799 62,783 81,376 18,458 20,467 15,169 292,392 547,444 Special mention 63 56,958 5,349 3,183 9,518 2,236 9,265 86,572 Substandard 2,283 22,042 64,350 35,042 21,337 53,879 8,030 206,963 Doubtful — 1,113 1,619 3,647 1,573 241 6,222 14,415 Total $ 803,340 $ 786,281 $ 672,229 $ 328,397 $ 150,905 $ 224,984 $ 1,515,986 $ 4,482,122 Current period charge-offs $ — $ 7,699 $ 4,887 $ 2,794 $ 1,911 $ 1,471 $ 1,345 $ 20,107 Amortized Cost Basis (Dollars in thousands) Term Loans and Leases by Origination Year Revolving Loans and Leases Total September 30, 2024 2024 2023 2022 2021 2020 Prior Term lending Pass $ 548,597 $ 398,832 $ 117,180 $ 77,585 $ 42,950 $ 24,166 $ — $ 1,209,310 Watch 47,765 52,317 34,964 31,025 2,720 2,312 — 171,103 Special mention 44,617 3,106 9,121 14,772 7,238 2 — 78,856 Substandard 9,798 24,187 18,537 11,660 18,894 2,631 — 85,707 Doubtful 4,314 1,465 2,247 758 114 767 — 9,665 Total 655,091 479,907 182,049 135,800 71,916 29,878 — 1,554,641 Current period charge-offs 114 3,102 8,502 3,576 2,184 715 — 18,193 Asset-based lending Pass — — — — — — 233,268 233,268 Watch — — — — — — 221,521 221,521 Special mention — — — — — — 13,187 13,187 Substandard — — — — — — 3,921 3,921 Total — — — — — — 471,897 471,897 Current period charge-offs — — — — — — — — Factoring Pass — — — — — — 292,436 292,436 Watch — — — — — — 62,270 62,270 Special mention — — — — — — 271 271 Substandard — — — — — — 7,306 7,306 Doubtful — — — — — — 12 12 21 Table of Contents Total — — — — — — 362,295 362,295 Current period charge-offs — — — — — — 2,453 2,453 Lease financing Pass 44,883 48,851 12,862 7,101 7,938 1,733 — 123,368 Watch 1,837 3,537 370 6,264 1,362 40 — 13,410 Special mention — 250 — — 174 — — 424 Substandard — 6,691 2,723 2,717 2,069 603 — 14,803 Doubtful — — — 138 31 — — 169 Total 46,720 59,329 15,955 16,220 11,574 2,376 — 152,174 Current period charge-offs — — — 207 80 — — 287 Insurance premium finance Current period charge-offs 86 890 173 — — — — 1,149 SBA/USDA Pass 60,636 171,136 179,490 20,825 28,588 39,319 — 499,994 Watch 5,244 6,967 — 639 10 3,026 — 15,886 Special mention — — — 156 — 363 — 519 Substandard 1,037 15,923 12,158 2,003 9,519 11,134 — 51,774 Doubtful — 185 55 55 62 98 — 455 Total 66,917 194,211 191,703 23,678 38,179 53,940 — 568,628 Current period charge-offs — 549 79 — 127 — — 755 Other commercial finance Pass 73,330 2,210 6,685 12,351 1,274 70,203 — 166,053 Watch — 2,480 — — — — — 2,480 Substandard — 508 — 16,923 — — — 17,431 Total 73,330 5,198 6,685 29,274 1,274 70,203 — 185,964 Current period charge-offs — — — — — — — — Warehouse finance Pass — — — — — — 517,847 517,847 Total — — — — — — 517,847 517,847 Current period charge-offs — — — — — — — — Total loans and leases Pass 727,446 621,029 316,217 117,862 80,750 135,421 1,043,551 3,042,276 Watch 54,846 65,301 35,334 37,928 4,092 5,378 283,791 486,670 Special mention 44,617 3,356 9,121 14,928 7,412 365 13,458 93,257 Substandard 10,835 47,309 33,418 33,303 30,482 14,368 11,227 180,942 Doubtful 4,314 1,650 2,302 951 207 865 12 10,301 Total $ 842,058 $ 738,645 $ 396,392 $ 204,972 $ 122,943 $ 156,397 $ 1,352,039 $ 3,813,446 Current period charge-offs $ 200 $ 4,541 $ 8,754 $ 3,783 $ 2,391 $ 715 $ 2,453 $ 22,837 22 Table of Contents Past due loans and leases were as follows: Accruing and Nonaccruing Loans and Leases Nonperforming Loans and Leases (Dollars in thousands) 30-59 Days Past Due 60-89 Days Past Due > 89 Days Past Due Total Past Due Current Total Loans and Leases Receivable > 89 Days Past Due and Accruing Nonaccrual Balance Total June 30, 2025 Loans held for sale $ — $ — $ — $ — $ 49,767 $ 49,767 $ — $ — $ — Term lending 23,236 5,910 23,336 52,482 1,951,217 2,003,699 188 39,217 39,405 Asset-based lending — — — — 610,852 610,852 — 9,517 9,517 Factoring — — — — 241,024 241,024 — 1,730 1,730 Lease financing 2,846 1,471 5,160 9,477 124,737 134,214 918 4,286 5,204 SBA/USDA 96 5,900 8,729 14,725 660,177 674,902 2,264 6,774 9,038 Other commercial finance — — — — 153,321 153,321 — — — Commercial finance 26,178 13,281 37,225 76,684 3,741,328 3,818,012 3,370 61,524 64,894 Consumer finance 3,376 2,497 6,402 12,275 214,105 226,380 6,402 — 6,402 Tax services — 37,234 — 37,234 185 37,419 — — — Warehouse finance — — — — 664,110 664,110 — — — Total loans and leases held for investment 29,554 53,012 43,627 126,193 4,619,728 4,745,921 9,772 61,524 71,296 Total loans and leases $ 29,554 $ 53,012 $ 43,627 $ 126,193 $ 4,669,495 $ 4,795,688 $ 9,772 $ 61,524 $ 71,296 September 30, 2024 Loans held for sale $ 2,266 $ 1,361 $ 1,050 $ 4,677 $ 687,011 $ 691,688 $ 1,050 $ — $ 1,050 Term lending 19,776 5,124 17,694 42,594 1,512,047 1,554,641 1,923 23,462 25,385 Asset-based lending — — — — 471,897 471,897 — — — Factoring — — — — 362,295 362,295 — 29 29 Lease financing 3,605 1,595 109 5,309 146,865 152,174 60 746 806 SBA/USDA — 952 2,172 3,124 565,504 568,628 331 2,175 2,506 Other commercial finance — — — — 185,964 185,964 — — — Commercial finance 23,381 7,671 19,975 51,027 3,244,572 3,295,599 2,314 26,412 28,726 Consumer finance 3,962 3,186 3,053 10,201 238,599 248,800 3,053 — 3,053 Tax services — — 8,733 8,733 92 8,825 8,733 — 8,733 Warehouse finance — — — — 517,847 517,847 — — — Total loans and leases held for investment 27,343 10,857 31,761 69,961 4,001,110 4,071,071 14,100 26,412 40,512 Total loans and leases $ 29,609 $ 12,218 $ 32,811 $ 74,638 $ 4,688,121 $ 4,762,759 $ 15,150 $ 26,412 $ 41,562 23 Table of Contents Nonaccrual loans and leases by year of origination were as follows: Amortized Cost Basis (Dollars in thousands) Term Loans and Leases by Origination Year Revolving Loans and Leases Total Nonaccrual with No ACL June 30, 2025 2025 2024 2023 2022 2021 Prior Term lending $ — $ 807 $ 13,395 $ 11,286 $ 13,537 $ 192 $ — $ 39,217 $ 19,152 Asset-based lending — — — — — — 9,517 9,517 — Factoring — — — — — — 1,730 1,730 — Lease financing — — 150 — 3,480 656 — 4,286 4,079 SBA/USDA — 3,537 3,082 — 27 128 — 6,774 — Commercial finance — 4,344 16,627 11,286 17,044 976 11,247 61,524 23,231 Total nonaccrual loans and leases $ — $ 4,344 $ 16,627 $ 11,286 $ 17,044 $ 976 $ 11,247 $ 61,524 $ 23,231 Amortized Cost Basis (Dollars in thousands) Term Loans and Leases by Origination Year Revolving Loans and Leases Total Nonaccrual with No ACL September 30, 2024 2024 2023 2022 2021 2020 Prior Term lending $ 9,281 $ 3,433 $ 5,369 $ 1,386 $ 625 $ 3,368 $ — $ 23,462 $ 2,579 Factoring — — — — — — 29 29 — Lease financing — 577 11 46 2 110 — 746 — SBA/USDA — 738 55 55 742 585 — 2,175 681 Commercial finance 9,281 4,748 5,435 1,487 1,369 4,063 29 26,412 3,260 Total nonaccrual loans and leases $ 9,281 $ 4,748 $ 5,435 $ 1,487 $ 1,369 $ 4,063 $ 29 $ 26,412 $ 3,260 Loans and leases that are 90 days or more delinquent and accruing by year of origination were as follows: Amortized Cost Basis (Dollars in thousands) Term Loans and Leases by Origination Year Revolving Loans and Leases Total 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 Commercial finance — 2,364 149 856 — 1 — 3,370 Consumer finance 4,625 892 763 90 32 — — 6,402 Total loans and leases held for investment 4,625 3,256 912 946 32 1 — 9,772 Total 90 days or more delinquent and accruing $ 4,625 $ 3,256 $ 912 $ 946 $ 32 $ 1 $ — $ 9,772 Amortized Cost Basis (Dollars in thousands) Term Loans and Leases by Origination Year Revolving Loans and Leases Total September 30, 2024 2024 2023 2022 2021 2020 Prior Loans held for sale $ 1,031 $ 19 $ — $ — $ — $ — $ — $ 1,050 Term lending — 621 354 719 217 12 — 1,923 Lease financing — — — 2 58 — — 60 SBA/USDA — — 331 — — — — 331 Commercial finance — 621 685 721 275 12 — 2,314 Consumer finance 736 1,841 388 88 — — — 3,053 Tax services 8,733 — — — — — — 8,733 Total loans and leases held for investment 9,469 2,462 1,073 809 275 12 — 14,100 Total 90 days or more delinquent and accruing $ 10,500 $ 2,481 $ 1,073 $ 809 $ 275 $ 12 $ — $ 15,150 24 Table of Contents Certain loans and leases 90 days or more past due as to interest or principal continue to accrue because they are (1) well-secured and in the process of collection or (2) consumer loans exempt under regulatory rules from being classified as nonaccrual until later delinquency, usually 120 days past due. The following table provides the average recorded investment in nonaccrual loans and leases: Three Months Ended June 30, Nine Months Ended June 30, (Dollars in thousands) 2025 2024 2025 2024 Term lending $ 30,308 $ 20,007 $ 27,012 $ 18,808 Asset-based lending 6,996 — 2,970 4,896 Factoring 1,350 967 1,004 2,631 Lease financing 4,514 635 3,655 1,299 SBA/USDA 7,005 2,853 4,000 2,223 Commercial finance 50,173 24,462 38,641 29,857 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 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 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. NOTE 6. EARNINGS PER COMMON SHARE ("EPS") The Company has granted restricted share awards with dividend rights that are considered to be participating securities. Accordingly, a portion of the Company’s earnings is allocated to those participating securities in the earnings per share calculation under the two-class method. Basic EPS is computed using the two-class method by dividing income available to common stockholders after the allocation of dividends and undistributed earnings to the participating securities by the weighted average number of common shares outstanding for the period. Diluted EPS is calculated using the more dilutive of the two-class method or the treasury stock method. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised, and is computed after giving consideration to the weighted average dilutive effect upon vesting of performance share units ("PSUs") and restricted stock grants, and after the allocation of earnings to the participating securities. Antidilutive securities are disregarded in earnings per share calculations. Diluted EPS shown below reflects the two-class method, as diluted EPS under the two-class method was more dilutive than under the treasury stock method. 25 Table of Contents 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 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: Net income attributable to Pathward Financial, Inc. $ 42,147 $ 44,869 $ 147,069 $ 149,686 Dividends and undistributed earnings allocated to participating securities ( 152 ) ( 464 ) ( 553 ) ( 1,312 ) Basic net earnings available to common stockholders 41,995 44,405 146,516 148,374 Undistributed earnings allocated to nonvested restricted stockholders 148 451 540 1,278 Reallocation of undistributed earnings to nonvested restricted stockholders ( 147 ) ( 450 ) ( 537 ) ( 1,277 ) Diluted net earnings available to common stockholders $ 41,996 $ 44,406 $ 146,519 $ 148,375 Total weighted-average basic common shares outstanding 23,006,454 24,946,085 23,629,565 25,335,621 Effect of dilutive securities (1) PSUs 133,670 33,733 115,521 29,021 Total effect of dilutive securities 133,670 33,733 115,521 29,021 Total weighted-average diluted common shares outstanding 23,140,124 24,979,818 23,745,086 25,364,642 Net earnings per common share: Basic earnings per common share $ 1.83 $ 1.78 $ 6.20 $ 5.86 Diluted earnings per common share (2) $ 1.81 $ 1.78 $ 6.17 $ 5.85 (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 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. NOTE 7. RENTAL EQUIPMENT, NET Rental equipment consists of the following: (Dollars in thousands) June 30, 2025 September 30, 2024 Computers and IT networking equipment $ 12,080 $ 21,308 Motor vehicles and other 145,557 140,920 Other furniture and equipment 34,427 38,755 Solar panels and equipment 124,143 128,296 Total 316,207 329,279 Accumulated depreciation ( 135,595 ) ( 124,987 ) Unamortized initial direct costs 758 1,047 Net book value $ 181,370 $ 205,339 26 Table of Contents Future minimum lease payments expected to be received for operating leases at June 30, 2025 were as follows: (Dollars in thousands) Remaining in 2025 $ 10,039 2026 35,440 2027 26,800 2028 18,324 2029 12,994 Thereafter 6,488 Total $ 110,085 NOTE 8. GOODWILL AND INTANGIBLE ASSETS 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 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. See Note 3. Divestitures to the Condensed Consolidated Financial Statements for further information. The changes in the carrying amount of the Company's goodwill were as follows: (Dollars in thousands) Consumer Commercial Corporate Services/Other Total September 30, 2024 $ 87,145 $ 222,360 $ — $ 309,505 Divestiture — ( 11,577 ) — ( 11,577 ) June 30, 2025 $ 87,145 $ 210,783 $ — $ 297,928 September 30, 2023 $ 87,145 $ 222,360 $ — $ 309,505 June 30, 2024 $ 87,145 $ 222,360 $ — $ 309,505 27 Table of Contents 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. See Note 3. Divestitures to the Condensed Consolidated Financial Statements for further information. (Dollars in thousands) Trademark (1) Non-Compete Customer Relationships (2) All Others (3) Total September 30, 2024 $ 6,422 $ — $ 6,566 $ 3,601 $ 16,589 Amortization during the period ( 806 ) — ( 1,462 ) ( 425 ) ( 2,693 ) Write-offs and disposals during the period — — ( 631 ) — ( 631 ) June 30, 2025 $ 5,616 $ — $ 4,473 $ 3,176 $ 13,265 Gross carrying amount $ 13,774 $ 301 $ 70,338 $ 7,732 $ 92,145 Accumulated amortization ( 8,158 ) ( 301 ) ( 54,947 ) ( 4,403 ) ( 67,809 ) Accumulated impairment — — ( 10,918 ) ( 153 ) ( 11,071 ) 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 ) June 30, 2024 $ 6,687 $ — $ 7,092 $ 3,734 $ 17,513 Gross carrying amount $ 13,774 $ 301 $ 77,578 $ 7,732 $ 99,385 Accumulated amortization ( 7,087 ) ( 301 ) ( 59,568 ) ( 3,845 ) ( 70,801 ) Accumulated impairment — — ( 10,918 ) ( 153 ) ( 11,071 ) June 30, 2024 $ 6,687 $ — $ 7,092 $ 3,734 $ 17,513 (1) Book amortization period of 5 - 15 years. Amortized using the straight line and accelerated methods. (2) Book amortization period of 10 - 30 years. Amortized using the accelerated method. (3) Book amortization period of 3 - 20 years. Amortized using the straight line method. 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 three months of fiscal 2025 and subsequent fiscal years at June 30, 2025 was as follows: (Dollars in thousands) Remaining in 2025 $ 764 2026 3,103 2027 2,483 2028 2,194 2029 1,581 Thereafter 3,140 Total anticipated intangible amortization $ 13,265 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. NOTE 9. OPERATING LEASE RIGHT-OF-USE ASSETS AND LIABILITIES 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. 28 Table of Contents 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. The derecognition of the relevant lease ROU assets and liabilities resulted in a $ 0.5 million gain on remeasurement that was recognized as part of the overall gain on divestitures from the commercial insurance premium finance business sale. See Note 3. 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 June 30, 2025 were as follows: (Dollars in thousands) Remaining in 2025 $ 866 2026 3,391 2027 3,306 2028 3,397 2029 3,436 Thereafter 13,108 Total undiscounted future minimum lease payments 27,504 Discount ( 3,043 ) Total operating lease liabilities $ 24,461 The weighted-average discount rate and remaining lease term for operating leases were as follows: June 30, 2025 September 30, 2024 Weighted-average discount rate 2.67 % 2.45 % Weighted-average remaining lease term (years) 8.22 8.78 The components of total lease costs for operating leases were as follows: Three Months Ended June 30, Nine Months Ended June 30, (Dollars in thousands) 2025 2024 2025 2024 Lease expense $ 987 $ 990 $ 2,904 $ 3,007 Short-term and variable lease cost 18 21 62 44 Sublease income ( 350 ) ( 314 ) ( 1,053 ) ( 953 ) Total lease cost for operating leases $ 655 $ 697 $ 1,913 $ 2,098 NOTE 10. STOCKHOLDERS' EQUITY Repurchase of Common Stock. The Company's Board of Directors authorized the September 3, 2021 share repurchase program to repurchase up to 6,000,000 shares of the Company's outstanding common stock. This authorization was effective from September 3, 2021 through September 30, 2024, with 146,435 shares authorized by this repurchase program not repurchased when it expired. 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 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. The Company accounts for repurchased shares using the par value method under which the repurchase price is credited to paid-in capital up to the par value of those shares. When the repurchase price is greater than the original issue proceeds, the excess is charged to retained earnings. As of June 30, 2025, 5,118,556 shares of common stock remained available for repurchase. 29 Table of Contents 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. The Company accounts for the retirement of repurchased shares, including treasury stock, using the par value method under which the repurchase price is charged to paid-in capital up to the amount of the original proceeds of those shares. 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 nine months ended June 30, 2025 and 2024. NOTE 11. STOCK COMPENSATION On February 27, 2024, the shareholders of the Company voted to approve the Pathward Financial, Inc. 2023 Omnibus Incentive Plan (the "Plan"). The Plan permits the granting of various types of awards including but not limited to nonvested (restricted) shares and PSUs to certain officers and directors of the Company. Awards may be granted by the Compensation Committee of the Board of Directors based on the performance of the award recipients or other relevant factors. Shares have previously been granted each year to executives and senior leadership members under the applicable Company incentive plan. These shares vest at various times ranging from immediately to three years based on circumstances at time of grant. The fair value is determined based on the fair market value of the Company’s stock on the grant date. Director shares are issued to the Company’s directors, and these shares have historically vested from immediately to up to one year from the grant date. The Company also grants selected executives PSU awards. The vesting of these awards is contingent on meeting company-wide performance goals, including earnings per share. PSUs are generally granted at the market value of the underlying share on the date of grant, adjusted for dividends, as PSUs do not participate in dividends. The awards contingently vest over a period of three years and have payout levels ranging from a threshold of 50 % to a maximum of 200 %. Upon vesting, each PSU earned is converted into one share of common stock. The fair value of the PSUs is determined by the dividend-adjusted fair value on the grant date for those awards subject to a performance condition. For those PSUs subject to a market condition, a simulation valuation is performed. In addition, during the first and second quarters of fiscal year 2017, shares were granted to certain executive officers of the Company in connection with their signing of employment agreements with the Company. These stock awards vest in equal installments over eight years . 30 Table of Contents 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 nine months ended June 30, 2025. Number of Shares Weighted Average Fair Value at Grant Restricted Stock Awards Nonvested shares outstanding, September 30, 2024 248,670 $ 41.19 Granted 15,600 77.42 Vested ( 179,669 ) 41.24 Forfeited or expired ( 2,606 ) 47.94 Nonvested shares outstanding, June 30, 2025 81,995 $ 47.77 Restricted Stock Units Nonvested shares outstanding, September 30, 2024 — $ — Granted 88,310 79.47 Vested — — Forfeited or expired ( 3,939 ) 79.35 Nonvested shares outstanding, June 30, 2025 84,371 $ 79.48 Number of Units Weighted Average Fair Value at Grant PSUs PSUs outstanding, September 30, 2024 142,462 $ 47.24 Granted 34,208 79.47 Vested ( 34,304 ) 57.21 Forfeited or expired — — 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. The exercise price of fair value of nonvested (restricted) shares and PSUs granted under the Company’s incentive plans is equal to the fair market value of the underlying stock at the grant date, adjusted for dividends where applicable. The Company has elected to record forfeitures as they occur. 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. NOTE 12. INCOME TAXES 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. statutory rate of 21% primarily because of the effect of investment tax credits during fiscal year 2025. The Company's effective tax rate in the future will depend in part on actual investment tax credits generated from qualified renewable energy property. 31 Table of Contents The table below compares the income tax expense components for the periods presented. Nine Months Ended June 30, 2025 2024 (Dollars in thousands) (As Restated) Provision at statutory rate $ 36,547 $ 37,887 Tax-exempt income ( 480 ) ( 522 ) State income taxes 6,562 7,300 Interim period effective rate adjustment ( 9,971 ) ( 846 ) Tax credit investments, net - federal ( 3,913 ) ( 12,556 ) Research tax credit ( 752 ) ( 602 ) IRC 162(m) nondeductible compensation 1,061 826 Other, net ( 2,088 ) ( 761 ) Income tax expense $ 26,966 $ 30,726 Effective tax rate 15.44 % 16.96 % 32 Table of Contents NOTE 13. REVENUE FROM CONTRACTS WITH CUSTOMERS Topic 606 applies to all contracts with customers unless such revenue is specifically addressed under existing guidance. The table below presents the Company’s revenue by operating segment. For additional descriptions of the Company’s operating segments, including additional financial information and the underlying management accounting process, see Note 14. Segment Reporting to the Condensed Consolidated Financial Statements. (Dollars in thousands) Consumer Commercial Corporate Services/Other Consolidated Company (As Restated) (As Restated) (As Restated) (As Restated) Three Months Ended June 30, 2025 2024 2025 2024 2025 2024 2025 2024 Net interest income (1) $ 67,949 $ 69,328 $ 51,241 $ 52,932 $ 3,123 $ 490 $ 122,313 $ 122,750 Noninterest income: Refund transfer product fees 9,846 9,111 — — — — 9,846 9,111 Refund advance and other tax fee income (1) 307 ( 67 ) — — — — 307 ( 67 ) Card and deposit fees 37,171 33,151 165 250 6 7 37,342 33,408 Rental income (1) — — 12,681 13,615 232 164 12,913 13,779 Secondary market revenue (1) 41 20 7,103 1,701 — — 7,144 1,721 Gain on sale of other (1) — — 330 563 64 2,391 394 2,954 Other income (1) 2,383 2,020 2,023 1,922 1,090 1,023 5,496 4,965 Total noninterest income 49,748 44,235 22,302 18,051 1,392 3,585 73,442 65,871 Revenue $ 117,697 $ 113,563 $ 73,543 $ 70,983 $ 4,515 $ 4,075 $ 195,755 $ 188,621 Nine Months Ended June 30, Net interest income (1) $ 224,644 $ 205,530 $ 136,521 $ 142,631 $ 22,677 $ 22,150 $ 383,842 $ 370,311 Noninterest income: Refund transfer product fees 42,919 38,475 — — — — 42,919 38,475 Refund advance and other tax fee income (1) 49,416 43,244 — — — — 49,416 43,244 Card and deposit fees 96,582 98,755 599 727 20 20 97,201 99,502 Rental income (1) — — 39,180 40,444 642 514 39,822 40,958 (Loss) on sale of securities (1) — — — — ( 22,899 ) — ( 22,899 ) — Gain on divestitures (1) — — — — 15,044 — 15,044 — Secondary market revenue (1) 56 5 13,515 3,086 13,329 — 26,900 3,091 Gain on sale of other (1) — — 1,487 1,147 520 4,972 2,007 6,119 Other income (1) 8,403 6,230 6,878 6,395 3,653 3,563 18,934 16,188 Total noninterest income 197,376 186,709 61,659 51,799 10,309 9,069 269,344 247,577 Revenue $ 422,020 $ 392,239 $ 198,180 $ 194,430 $ 32,986 $ 31,219 $ 653,186 $ 617,888 (1) These revenues are not within the scope of Topic 606. Additional details are included in other footnotes to the accompanying financial statements. The scope of Topic 606 explicitly excludes net interest income as well as many other revenues for financial assets and liabilities, including loans, leases, and securities. Following is a discussion of key revenues within the scope of Topic 606. The Company provides services to customers that have related performance obligations that must be completed to recognize revenue. Revenues are generally recognized immediately upon the completion of the service or over time as services are performed. Any services performed over time generally require that the Company renders services each period; 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 nine months ended June 30, 2025. 33 Table of Contents Refund Transfer Product Fees. Refund transfer fees are specific to the Partner Solutions business line and reflect product fees offered by the Company through third-party tax preparers and tax preparation software providers where the Company acts as the partnering financial institution. A refund transfer allows a taxpayer to pay tax preparation and filing fees directly from their federal or state government tax refund, with the remainder of the refund being disbursed in accordance with the terms and conditions of the taxpayer agreement, which may include satisfaction of other disbursement obligations before going directly to the taxpayer via check, direct deposit, or prepaid card. Refund transfer fees are recognized by the Company immediately after the taxpayer's refund has been disbursed in accordance with the contract and are based on standalone pricing included within the terms and conditions. Certain expenses to tax preparation software providers are netted with refund transfer fee income as the Company is considered the agent in these contractual relationships. All refund transfer fees are recorded within the Consumer reporting segment. Card and Deposit Fees. Card fees relate to the Partner Solutions business line and consist of income from prepaid cards and merchant services, including interchange fees from prepaid cards processed through card association networks, merchant services and other card related services. Interchange rates are generally set by card association networks based on transaction volume and other factors. Since interchange fees are generated by cardholder activity, the Company recognizes the income as transactions occur. Fee income for merchant services and other card related services reflect account management and transaction fees charged to merchants for processing card association network transactions. The associated income is recognized as transactions occur or as services are performed. For the Company's internally managed prepaid card programs, fees are based on standalone pricing within the terms and conditions of the cardholder agreement. The Company is considered the principal of these relationships resulting in all fee income being presented on a gross basis within the Condensed Consolidated Statement of Operations. For the Company's sponsorship prepaid card programs where a third-party is considered the Program Manager, the fees are based on standalone pricing within the terms and conditions of the Program Agreement. For these relationships, the Company is considered the agent and certain expenses with the Program Manager, networks and associations are netted with card fee revenue. All card fee income is included in the Consumer reporting segment. Deposit fees relate to the Partner Solutions and Commercial Finance business lines and consist of income from banking and deposit-related services, including account services, overdraft protection, and wire transfers. Fee income for account services is recognized over the course of the month as the performance obligation is satisfied. Fee income for overdraft protection and wire transfers is recognized at the point in time when such event occurs. For partner solutions, the fees for account services and overdraft protection are based on standalone pricing within the terms and conditions of the Program Agreement with the sponsorship partner. For these relationships, the Company is considered the agent and certain expenses with the partner are netted with deposit fee revenue. For Commercial Finance, fees for wire transfers are based on standalone pricing within the terms and conditions of the customer deposit agreement. Bank and deposit fees for the Partner Solutions and Commercial Finance business lines are included in the Consumer and Commercial reporting segments, respectively. Also included within Card and Deposit Fees for the Consumer reporting segment are servicing fees the Company recognizes for off-balance sheet custodial deposits. This fee income is for services the Bank performs to maintain records of cardholder funds placed at one or more third-party banks insured by the Federal Deposit Insurance Corporation ("FDIC"). The servicing fee is typically reflective of the effective federal funds rate ("EFFR"). NOTE 14. SEGMENT REPORTING An operating segment is generally defined as a component of a business for which discrete financial information is available and whose results are reviewed by the chief operating decision-maker. Operating segments are aggregated into reportable segments if certain criteria are met. The Company reports its results of operations through the following three business segments: Consumer, Commercial, and Corporate Services/Other. The Partner Solutions business line is reported in the Consumer segment. The Commercial Finance business line is reported in the Commercial segment. The Corporate Services/Other segment includes certain shared services as well as treasury related functions such as the investment portfolio, warehouse finance, wholesale deposits, and borrowings. 34 Table of Contents The following table presents segment data for the Company: (Dollars in thousands) Consumer Commercial Corporate Services/Other Total (As Restated) (As Restated) (As Restated) (As Restated) 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 Provision for credit loss ( 2,114 ) 3,859 11,371 8,013 21 55 9,278 11,927 Noninterest income 49,748 44,235 22,302 18,051 1,392 3,585 73,442 65,871 Noninterest expense 56,962 50,964 32,237 33,227 50,123 41,319 139,322 125,510 Income (loss) before income tax expense 62,849 58,740 29,935 29,743 ( 45,629 ) ( 37,299 ) 47,155 51,184 Total assets 419,654 423,116 4,257,971 4,324,946 2,552,219 2,764,968 7,229,844 7,513,030 Total goodwill 87,145 87,145 210,783 222,360 — — 297,928 309,505 Total deposits 5,823,684 6,190,419 87 13,592 181,475 227,505 6,005,246 6,431,516 Nine Months Ended June 30, Net interest income $ 224,644 $ 205,530 $ 136,521 $ 142,631 $ 22,677 $ 22,150 $ 383,842 $ 370,311 Provision for credit loss 40,349 34,325 22,710 15,031 146 73 63,205 49,429 Noninterest income 197,376 186,709 61,659 51,799 10,309 9,069 269,344 247,577 Noninterest expense 177,290 162,543 98,603 106,213 139,403 118,573 415,296 387,329 Income (loss) before income tax expense 204,381 195,371 76,867 73,186 ( 106,563 ) ( 87,427 ) 174,685 181,130 Total assets 419,654 423,116 4,257,971 4,324,946 2,552,219 2,764,968 7,229,844 7,513,030 Total goodwill 87,145 87,145 210,783 222,360 — — 297,928 309,505 Total deposits 5,823,684 6,190,419 87 13,592 181,475 227,505 6,005,246 6,431,516 NOTE 15. FAIR VALUES OF FINANCIAL INSTRUMENTS ASC 820, Fair Value Measurements defines fair value, establishes a framework for measuring the fair value of assets and liabilities using a hierarchy system and requires disclosures about fair value measurement. It clarifies that fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants in the market in which the reporting entity transacts. The fair value hierarchy is as follows: Level 1 Inputs - Valuation is based upon quoted prices for identical instruments traded in active markets that the Company has the ability to access at measurement date. Level 2 Inputs - Valuation is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-based valuation techniques for which significant assumptions are observable in the market. Level 3 Inputs - Valuation is generated from model-based techniques that use significant assumptions not observable in the market and are used only to the extent that observable inputs are not available. These unobservable assumptions reflect the Company’s own estimates of assumptions that market participants would use in pricing the asset or liability. Debt Securities AFS and HTM . Debt securities AFS are recorded at fair value on a recurring basis and debt securities HTM are carried at amortized cost. 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 35 Table of Contents reviews the prices obtained from independent asset pricing services for unusual fluctuations and compares to current market trading activity. Equity Securities. Marketable equity securities and certain non-marketable equity securities are recorded at fair value on a recurring basis. The fair values of marketable equity securities are determined by obtaining quoted prices on nationally recognized securities exchanges (Level 1 inputs). Derivatives . The Bank's use of derivatives is limited to the Consumer Lending Programs. Under these Programs, the Bank has an agreement with a third party to originate consumer loans that are included in the Bank's held for investment or held for sale portfolios. The third party provides a target return to the Company on the portfolio of loans retained by the Bank and all interest received from borrowers on such loans above the target return and after all charge-offs have been covered is paid to the third party as excess interest and servicing. The primary drivers of the derivative value include the Company's ability to settle the loans at par value and the third party partners' rights of first refusal to purchase loans that the Company intends to sell. The Company estimates the fair value of the derivative instrument using a market approach considering primarily the average interest rate on the underlying loans and the credit spread relative to the risk-free rate in order to validate that the value of the loans is in excess of par and thus the derivative could be settled by either party at no cost. 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 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 June 30, 2025 Debt securities AFS Corporate securities $ 21,125 $ — $ 21,125 $ — SBA securities 10,683 — 10,683 — Obligations of states and political subdivisions 161 — 161 — Non-bank qualified obligations of states and political subdivisions 189,545 — 189,545 — Asset-backed securities 140,192 — 140,192 — Mortgage-backed securities 1,005,634 — 1,005,634 — Total debt securities AFS $ 1,367,340 $ — $ 1,367,340 $ — Common equities and mutual funds (1) $ 3,675 $ 3,675 $ — $ — Non-marketable equity securities (2) $ 12,669 $ — $ — $ — September 30, 2024 Debt securities AFS Corporate securities $ 19,750 $ — $ 19,750 $ — SBA securities 81,935 — 81,935 — Obligations of states and political subdivisions 480 — 480 — Non-bank qualified obligations of states and political subdivisions 217,990 — 217,990 — Asset-backed securities 189,698 — 189,698 — Mortgage-backed securities 1,231,368 — 1,231,368 — Total debt securities AFS $ 1,741,221 $ — $ 1,741,221 $ — Common equities and mutual funds (1) $ 3,303 $ 3,303 $ — $ — Non-marketable equity securities (2) $ 11,828 $ — $ — $ — (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. 36 Table of Contents Loans and Leases. The Company does not record loans and leases at fair value on a recurring basis. However, if a loan or lease is individually evaluated for risk of credit loss and repayment is expected to be solely provided by the values of the underlying collateral, the Company measures fair value on a nonrecurring basis. Fair value is determined by the fair value of the underlying collateral less estimated costs to sell. The fair value of the collateral is determined based on the internal estimates and/or assessment provided by third-party appraisers and the valuation relies on discount rates ranging from 3 % to 35 %. The following table summarizes the assets of the Company that are measured at fair value in the Condensed Consolidated Statements of Financial Condition on a nonrecurring basis: (Dollars in thousands) Total Level 1 Level 2 Level 3 June 30, 2025 Loans and leases, net individually evaluated for credit loss Commercial finance $ 20,401 $ — $ — $ 20,401 Total loans and leases, net individually evaluated for credit loss 20,401 — — 20,401 Total $ 20,401 $ — $ — $ 20,401 September 30, 2024 Loans and leases, net individually evaluated for credit loss Commercial finance $ 7,652 $ — $ — $ 7,652 Total loans and leases, net individually evaluated for credit loss 7,652 — — 7,652 Total $ 7,652 $ — $ — $ 7,652 Quantitative Information About Level 3 Fair Value Measurements (Dollars in thousands) Fair Value at June 30, 2025 Fair Value at September 30, 2024 Valuation Technique Unobservable Input Range of Inputs Loans and leases, net individually evaluated for credit loss $ 20,401 $ 7,652 Market approach Appraised values (1) 3 % - 35 % (1) The Company generally relies on external appraisers to develop this information. Management reduced the appraised value by estimating selling costs and other inputs in a range of 3 % to 35 %. 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 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. However, since there is no active market for certain financial instruments of the Company, the estimates of fair value are subjective in nature, involve uncertainties, and include matters of significant judgment. Changes in assumptions as well as tax considerations could significantly affect the estimated values. Accordingly, the aggregate fair value estimates are not intended to represent the underlying value of the Company, on either a going concern or a liquidation basis. 37 Table of Contents The following tables present the carrying amount and estimated fair value of the financial instruments held by the Company: June 30, 2025 (Dollars in thousands) Carrying Amount Estimated Fair Value Level 1 Level 2 Level 3 Financial assets Cash and cash equivalents $ 258,343 $ 258,343 $ 258,343 $ — $ — Debt securities available for sale 1,367,340 1,367,339 — 1,367,339 — Debt securities held to maturity 30,273 25,771 — 25,771 — Common equities and mutual funds (1) 3,675 3,675 3,675 — — Non-marketable equity securities (1)(2) 22,369 22,369 — 9,699 — Loans held for sale 49,767 49,767 — 49,767 — Loans and leases 4,745,921 4,704,600 — — 4,704,600 Federal Reserve Bank and Federal Home Loan Bank stocks 29,451 29,451 — 29,451 — Accrued interest receivable 39,996 39,996 39,996 — — Financial liabilities 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 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. September 30, 2024 (Dollars in thousands) Carrying Amount Estimated Fair Value Level 1 Level 2 Level 3 Financial assets Cash and cash equivalents $ 158,337 $ 158,337 $ 158,337 $ — $ — Debt securities available for sale 1,741,221 1,741,221 — 1,741,221 — Debt securities held to maturity 33,092 30,236 — 30,236 — Common equities and mutual funds (1) 3,303 3,303 3,303 — — Non-marketable equity securities (1)(2) 21,350 21,350 — 9,522 — Loans held for sale 691,688 691,688 — 691,688 — Loans and leases 4,071,071 4,036,490 — — 4,036,490 Federal Reserve Bank and Federal Home Loan Bank stocks 36,014 36,014 — 36,014 — Accrued interest receivable 31,385 31,385 31,385 — — Financial liabilities Deposits 5,875,085 5,874,994 5,845,879 29,115 — Overnight federal funds purchased 377,000 377,000 377,000 — — Other short- and long-term borrowings 33,354 31,787 — 31,787 — Accrued interest payable 571 571 571 — — (1) Equity securities at fair value are included within other assets on the Consolidated Statements of Financial Condition at September 30, 2024. (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. NOTE 16. SUBSEQUENT EVENTS Management has evaluated subsequent events that occurred after June 30, 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 June 30, 2025. 38 Table of Contents NOTE 17. RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS 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 nine months ended June 30, 2024, was restated in the Form 10-K/A for the fiscal year ended September 30, 2024. 39 Table of Contents