What changed in this filing

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Item 1. Business

2025-03-05 compared with 2024-02-28 · 26 added, 32 removed, 283 unchanged (17% of the section changed)

61 unchanged sentences

These include:

FreightPay®, Transdata®, Ratemaker®, Best Rate®, Rate Exchange®, CassPort®, Cass Freight Index®, Cass Truckload Linehaul Index®, Cass Intermodal Price Index® Expense$mart®, ExpenseSmart®, TouchPoint®, Gyve®, Generosity Made Simple®, WasteVision™ and Direct2Carrier Payments™.

The Company holds patents for methods and systems for managing employee-liable expenses and methods and systems for communicating expense management information.

The Company holds patents for methods and systems of the following:

managing employee-liable expenses, communicating expense management information, electronic auditing, and electronically generating and analyzing shipping parameters.

The Company also holds patents for computer readable media for electronic auditing.

The Company and its subsidiaries have a varied client base and are not dependent on any one customer or group of customers for a significant portion of its business.

5 unchanged sentences

Furthering the philosophy to attract and retain a pool of talented and motivated employees who will continue to advance the Company’s purpose and contribute to overall success, compensation and benefits programs include:

a noncontributory profit sharing program for most employees;

a noncontributory profit sharing program for exempt employees;

a defined contribution 401(k) plan to provide retirement benefits to eligible employees;

a performance-based equity compensation program for executive officers and key personnel;

and incentive programs for loan and sales personnel.

and incentive programs for loan

and sales personnel.

Cass also provides comprehensive health, dental, and vision plans to most employees, as well as free employee assistance programs to all employees and members of their families.

4 unchanged sentences

Additionally, the Company supports a number of organizations with annual financial contributions.

The Company recognizes the benefits of building a corporate culture that promotes diversity, equity and inclusion ("DEI") to foster unique ideas and ways of thinking.

In pursuit of the Company's overall DEI mission, Cass focuses on:

a) cultivating an environment that encourages collaboration, flexibility and fairness to enable all employees to contribute to their full potential;

b) promoting diversity in our talent management and succession planning processes and employee development programs;

and c) ensuring leadership commitment in facilitating the Company's DEI efforts.

The Company's DEI Committee was formed after a thorough process of determining a charter and actively looks to expand the Company's DEI vision.

The committee members are passionate about DEI efforts and represent the Company's various business divisions and corporate departments.

The Company continues to promote DEI within its culture and make improvements to human resources programs to support related initiatives.

The Company recognizes the benefits of building a corporate culture that promotes diversity and fosters unique ideas and ways of thinking.

Among other things, Cass focuses on cultivating an environment that encourages collaboration, flexibility and fairness to enable all employees to contribute to their full potential.

As of December 31, 2024, 70% of the Company's U.S.

3 unchanged sentences

The Company also continues its commitment to providing a workplace that is free of harassment and discrimination by taking proactive measures and providing all employees with non-discrimination and sexual harassment prevention training on an annual basis.

The DEI initiatives are supported and promoted to provide all employees a place where they feel welcomed, appreciated and valued.

Initiatives are supported and promoted to provide all employees a place where they feel welcomed, appreciated and valued.

Equal opportunities, anti-harassment, non-discrimination, the health and safety of employees and work-life balance are actively promoted as more fully described in the Company's Environmental, Social, and Governance ("ESG") report.

14 unchanged sentences

A financial holding company’s status will also depend upon it maintaining its status as “well capitalized” and “well managed’ under applicable FRB regulations.

permissible for financial holding companies or acquire a company engaged in such financial activities without prior approval of the FRB.

If a financial holding company ceases to meet these capital and management requirements, the FRB may impose limitations or conditions on the conduct of its activities during the non-compliance period, and the company may not commence any of the broader financial activities permissible for financial holding companies or acquire a company engaged in such financial activities without prior approval of the FRB.

If the company does not return to compliance within 180 days, the FRB may require divestiture of the holding company’s depository institutions.

24 unchanged sentences

In August 2022, the Inflation Reduction Act of 2022 (the “Inflation Reduction Act") was enacted.

Among other things, the Inflation Reduction Act imposes a new 1% excise tax on the fair market value of stock repurchased after December 31,

2022 by publicly traded U.S.

Among other things, the Inflation Reduction Act imposes a new 1% excise tax on the fair market value of stock repurchased after December 31, 2022 by publicly traded U.S.

corporations.

With certain exceptions, the value of stock repurchased is determined net of stock issued in the year, including shares issued pursuant to compensatory arrangements.

Capital Requirements – As a bank holding company, the Company and the Bank are subject to capital requirements pursuant to the FRB’s capital guidelines which include (i) risk-based capital guidelines, which are designed to make capital requirements more sensitive to various risk profiles and account for off-balance sheet exposure;

requirements more sensitive to various risk profiles and account for off-balance sheet exposure;

(ii) guidelines that consider market risk, which is the risk of loss due to change in value of assets and liabilities due to changes in interest rates;

23 unchanged sentences

In December 2017, the Basel Committee published standards that it described as the finalization of the Basel III post-crisis regulatory reforms (commonly referred to as “Basel IV”).

Among other things, these standards revise the Basel Committee's standardized approach for credit risk (including by recalibrating risk weights and introducing new capital requirements for certain “unconditionally cancellable commitments,” such as unused credit card lines of credit) and

provides a new standardized approach for operational risk capital.

Under the Basel framework, these standards went into effect on January 1, 2023, with an aggregate output floor phasing in through January 1, 2027.

13 unchanged sentences

In November 2023, the FDIC issued a final rule to implement a special assessment to recover losses to the DIF incurred as a result of bank failures in early 2023 and the FDIC's use of the systemic risk exception to cover certain deposits that were otherwise uninsured.

The special assessment was based on estimated uninsured deposits as of December 31, 2022 (excluding the first $5.0 billion) and will be assessed at a quarterly rate of 3.36 basis points, over eight quarterly assessment periods, beginning in the first quarter of 2024.

As a result of this final rule, the Company did not accrue expense related to this assessment based on the amount of uninsured deposits at December 31, 2022 of less than $5.0 billion.

The special assessment was based on estimated uninsured deposits as of December 31, 2022 (excluding the first $5.0 billion) and is being assessed at a quarterly rate of 3.36 basis points, over eight quarterly assessment periods, beginning in the first quarter of 2024.

As a result of this final rule, the Company is not accruing expense related to this assessment based on the amount of uninsured deposits at December 31, 2022 of less than $5.0 billion.

Under the final rule, the estimated loss pursuant to the systemic risk determination will be periodically adjusted, and the FDIC has retained the ability to cease collection early, extend the special assessment collection period, and impose a final shortfall special assessment on a one-time basis.

7 unchanged sentences

(ii) “adequately capitalized” if the institution has a total risk-based capital ratio of 8% or greater, a Tier 1 risk-based capital ratio of 6% or greater, a leverage ratio of 4% or greater, a common equity Tier 1 ratio of 4.5% or greater and does not meet the definition of “well capitalized”;

(iii) “undercapitalized” if the institution has a total risk-based capital ratio that is less than 8%, a Tier 1 risk-based capital ratio of less than 6%, a leverage ratio of less

than 4% or a common equity Tier 1 ratio of less than 4.5%;

(iii) “undercapitalized” if the institution has a total risk-based capital ratio that is less than 8%, a Tier 1 risk-based capital ratio of less than 6%, a leverage ratio of less than 4% or a common equity Tier 1 ratio of less than 4.5%;

(iv) “significantly undercapitalized” if the institution has a total risk-based capital ratio of less than 6%, a Tier 1 risk-based capital ratio of less than 4%, a leverage ratio of less than 3% or a common equity Tier 1 ratio of less than 3%;

1 unchanged sentence

An institution may be deemed to be in a capital category that is lower than indicated by its capital ratios if it is determined to be in an unsafe or unsound condition or if it receives an unsatisfactory examination rating with respect to certain matters.

A bank’s capital category is determined solely for the purpose of applying prompt corrective action regulations, and the capital category may not constitute an accurate representation of the bank’s overall financial condition or prospects for other purposes.

A bank’s capital category is

determined solely for the purpose of applying prompt corrective action regulations, and the capital category may not constitute an accurate representation of the bank’s overall financial condition or prospects for other purposes.

Subject to a narrow exception, a receiver or conservator is required to be appointed for an institution that is “critically undercapitalized” within specified time frames.

19 unchanged sentences

Depository institutions are periodically examined for compliance with the CRA and are assigned ratings that must be publicly disclosed.

In order for a financial holding

company to commence any new activity permitted by the BHC Act, or to acquire any company engaged in any new activity permitted by the BHC Act, each insured depository institution subsidiary of the financial holding company must have received a rating of at least “satisfactory” in its most recent examination under the CRA.

In order for a financial holding company to commence any new activity permitted by the BHC Act, or to acquire any company engaged in any new activity permitted by the BHC Act, each insured depository institution subsidiary of the financial holding company must have received a rating of at least “satisfactory” in its most recent examination under the CRA.

The Bank received a rating of “satisfactory” in its most recent CRA exam.

38 unchanged sentences

In 2021, Congress passed the Corporate Transparency Act as part of the National Defense Authorization Act, which enacted the most significant overhaul of the BSA and related AML laws since the USA PATRIOT Act.

Notable amendments include (i) significant changes to the collection of beneficial ownership information and the establishment of a beneficial ownership registry, which requires corporate entities (generally, any corporation, limited liability company or other similar entity with 20 or fewer employees and annual gross income of $5 million or less) to report beneficial ownership information to FinCEN (which information will be maintained by FinCEN and made available upon request to financial institutions);

Notable amendments include (i) significant changes to the collection of beneficial ownership information and the establishment of a beneficial ownership registry, which requires corporate entities (generally, any corporation, limited liability company or other similar entity with 20 or fewer employees and/or annual gross income of $5 million or less) to report beneficial ownership information to FinCEN (which information will be maintained by FinCEN and made available upon request to certain government agencies and financial institutions);

(ii) enhanced whistleblower provisions, which provide that one or more whistleblowers who voluntarily provide original information leading to the successful enforcement of violations of the AML laws in any judicial or administrative action brought by the Secretary of the Treasury or the Attorney General resulting in monetary sanctions exceeding $1 million (including disgorgement and interest but excluding forfeiture, restitution, or compensation to victims) will receive not more than 30 percent of the monetary sanctions collected and will receive increased protections;

7 unchanged sentences

The Access Rule, effective as of February 20, 2024, sets forth the circumstances under which FinCEN can disclose beneficial ownership information to authorized recipients and how FinCEN and recipients of the data will protect that information.

It is expected that FinCEN will issue a third rule, by January 1, 2025, to revise existing customer due diligence requirements and bring them into conformance with the Corporate Transparency Act and the Access Rule.

It is expected that FinCEN will issue a third rule to revise existing customer due diligence requirements and bring them into conformance with the Corporate Transparency Act and the Access Rule.

Climate-Related Regulation and Guidance - In recent years the federal banking agencies have increased their focus on climate-related risks impacting the operations of banks, the communities they serve and the broader financial system.

3 unchanged sentences

account for the effects of climate change in stress testing scenarios and systemic risk assessments;

revise expectations for credit portfolio concentrations based on climate-related factors;

revise expectations for

credit portfolio concentrations based on climate-related factors;

consider investments in climate-related initiatives and lending to communities disproportionately impacted by the effects of climate change;

23 unchanged sentences

Cass files annual, quarterly and current reports with the Securities and Exchange Commission (the “SEC”).

Cass will, as soon as reasonably practicable after they are electronically filed with or furnished to the SEC, make available free of charge

on its website each of its Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, all amendments to those reports, and its definitive proxy statements.

Cass will, as soon as reasonably practicable after they are electronically filed with or furnished to the SEC, make available free of charge on its website each of its Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, all amendments to those reports, and its definitive proxy statements.

The address of Cass’ website is:

4 unchanged sentences

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

What changed 10-K

Item 1. Business