Managing Director - Business Development, Working Capital

What Pathward Financial (CASH) said on its Q4 earnings call. October 21, 2026 Key points. * Fiscal 2026 performance improved through commercial finance growth and higher payments-related fee income. Full-year net income was $175.7 million, or $8.14 per diluted share, while fourth-quarter adjusted net interest margin rose to 5.51%. * Credit problems remain concentrated in previously disclosed loans, including renewable energy projects. Nonperforming loans and leases reached 5.61%, but management expects credit costs to normalize in fiscal 2027 as those assets are resolved. * Pathward reiterated fiscal 2027 earnings guidance of $9.50 to $10 per share, while planning earlier investments in employees, technology and processes. The company also expects its securities portfolio to decline toward an $800 million-to-$1 billion range as capital shifts toward lending. * MarketBeat All Access makes it easier to follow Pathward Financial with alerts, analyst ratings, and deeper research - now $149 a year with your rate locked in. Pathward Financial NASDAQ: CASH said its fourth-quarter and fiscal 2026 performance reflected growth in commercial finance and payments-related fee income, while the company continued to address a group of previously disclosed credit issues tied in part to renewable energy projects. Chief Executive Officer Brett Pharr said fiscal 2026 was a year of execution against the company's strategic priorities, including balance-sheet optimization, investments in technology, risk and compliance, workforce development, and client experience. He said commercial finance growth and reductions in the company's lower-yielding securities portfolio reflected a disciplined approach to capital deployment. Pharr also said Pathward moved into the top 20 lenders in the Small Business Administration's 7(a) program and renewed its relationship with H&R Block through mid-2030. The company had previously announced an extension with earned-wage-access provider Clair. Financial results and balance sheet trends. Chief Financial Officer Greg Sigrist said net interest income from commercial finance increased by nearly $6 million in the fourth quarter. Non-interest income rose by a double-digit percentage, led by an almost $8 million increase in card and deposit fee income, with most of that growth coming from the core payments business. For the full fiscal year, Pathward reported net income of $175.7 million, or $8.14 per diluted share. Interest income from commercial finance increased by nearly $30 million, primarily due to growth in structured finance, Sigrist said. * Return on average assets was 2.30%. * Return on average tangible equity was 32.9%. * Loans and leases increased 9% at Sept. 30. * Adjusted net interest margin improved to 5.51% in the fourth quarter. * Loan originations increased to $2.2 billion from $1.3 billion a year earlier, largely due to credit sponsorship growth from a new contract and expanded existing partnerships. Average custodial deposits increased by more than $400 million from the prior year, even as deposits held on the balance sheet declined modestly. Pathward earns fee income on custodial deposits that is linked to the effective federal funds rate, Sigrist said. Discover more Track Stock Market Invest in Stocks The company had $3.1 billion of liquidity as of Sept. 30. During the quarter, it repurchased about 282,000 shares at an average price of $88.75. Pathward repurchased more than 2 million shares during the fiscal year and had 2.8 million shares remaining under its current authorization. Credit issues remain concentrated. Pathward's nonperforming loans and leases ratio rose modestly from the prior quarter to 5.61%. Net charge-offs were $52 million in the quarter, including $20.3 million related to the commercial finance portfolio. Management said the elevated charge-offs and nonperforming loan levels remain concentrated in credits the company has already discussed, rather than reflecting deterioration across the broader portfolio. Pharr said the company continues to work through renewable energy projects and has "line of sight" to completing them, though the process takes time. Sigrist said charge-offs are tied to specific reserves taken in prior quarters and should be distinguished from the company's ongoing cost of credit. He said Pathward expects credit costs to normalize during fiscal 2027 as it works down nonperforming loans. For the commercial finance portfolio, he described an allowance level of roughly 120 to 130 basis points as a historical normalized range, subject to changes in loan-production mix. Pharr said higher interest rates could create more opportunities in Pathward's asset-based lending and working-capital businesses, as traditional commercial borrowers seek alternatives to bank credit. He also said higher rates could alter the capitalization of energy infrastructure projects but should not prevent projects with strong returns from moving forward. Fiscal 2027 outlook and investment plans. Pathward reiterated fiscal 2027 earnings guidance of $9.50 to $10 per share. The outlook assumes no additional interest-rate changes during the year, an effective tax rate of 18% to 22%, and secondary-market revenue of $5 million to $7 million per quarter. Guidance also incorporates expected share repurchases. Sigrist said the company expects investments in people, processes and technology to begin earlier in fiscal 2027 than in past years. Additional hiring in the December quarter is expected to raise the compensation and benefits run rate earlier in the year, while consulting spending is expected to be modestly elevated during the first half. On interest rates, Sigrist said the company had shifted some new production toward floating-rate loans tied to prime, leaving it slightly asset-sensitive at present. He estimated that a 25-basis-point rate increase could add approximately $2 million pretax for a full year, though he characterized that position as temporary as construction-related lending declines and the balance sheet returns toward a more neutral rate posture. Partnership pipeline and securities portfolio. Pharr said the company's opportunity pipeline spans new and existing partners, as well as multiple products including credit sponsorship, embedded finance and card programs. He emphasized that no individual partner accounts for more than 5% of Pathward revenue. Sigrist said growth in card fee income is expected to continue to be driven primarily by existing partners adding programs and products, though new credit sponsorship and acquiring relationships can ramp more quickly than issuing partnerships. He said issuing programs generally take longer to onboard and scale, making newer partnerships a larger potential contributor in later fiscal years. The company expects its securities portfolio, which was slightly below $1.2 billion, to settle in an $800 million to $1 billion range. Sigrist said the portfolio remains an important source of liquidity and supports seasonal tax-related funding needs, although principal runoff is generally expected to be reinvested into the loan portfolio. He added that Pathward could buy a limited amount of securities to provide balance-sheet protection in a declining-rate environment. About Pathward Financial (NASDAQ:CASH). Pathward Financial, Inc is a financial services holding company that operates primarily through its subsidiary, Pathward, National Association. Based in Sioux Falls, South Dakota, the company provides banking and financial services to consumers and businesses across the United States. Pathward's businesses include consumer banking, commercial finance, payments and tax-related financial solutions. Its offerings include prepaid and debit card programs, account and payment services, tax refund and tax-related products, and financing solutions for businesses. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. 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Pathward selects Thought Machine's Vault Core. The South Dakota-headquartered institution will replace its foundational legacy software with the London vendor's central ledger platform. Tyler Pathe, Senior Reporter, FinTech Futures August 21, 2026 Pathward, a national US bank specialising in payments sponsorship and commercial finance, is migrating its central infrastructure over to the Vault Core system developed by London-headquartered vendor Thought Machine. Vault Core serves as a universal product engine and central ledger for accounts and transactions. The system leverages smart contracts in product design, with options to extend across transaction accounts, savings, loans, mortgages, and credit cards. The migration brings real-time development capabilities to Pathward, and "reinforces Pathward's technical independence to swiftly design and deploy bespoke financial solutions", Thought Machine said in announcing its latest client. Charles Ingram, chief information and operations officer at Pathward, is overseeing the move to Vault Core. He joined Pathward in 2020, following time at Nextiva and Pfizer, and ascended to this current position last year. In comments, Ingram reveals that work to update the company's core has "been underway for some time", with Vault Core to provide "a stronger foundation for responsible innovation and expanding access to financial solutions that can evolve with the market". Pathward, formerly MetaBank, currently operates as an issuing bank, providing infrastructure for business clients to issue prepaid cards, manage digital wallets, and process tax-refund deposits. Alongside its payment sponsorship business, the South Dakota-headquartered bank also runs a commercial lending division that provides structured loans, asset-based lending, and equipment financing directly to businesses. Other regional Vault Core users include Mascoma Bank, Arvest Bank, M1 Finance, and JP Morgan Chase, which is thought to be Thought Machine's most high-profile US client win to date. Senior Reporter, FinTech Futures Tyler Pathe is a financial reporter, moderator and investigator with a specific interest in financial technology, banking and the financial industry's latest innovations.