Pathward Financial Inc (CASH) 2023 Q1 法說會逐字稿

Ladies and gentlemen, thank you for standing by, and welcome to Pathward's Financial's First Quarter Fiscal Year 2023 Investor Conference Call. (Operator Instructions). As a reminder, this conference call is being recorded. I would now like to turn the conference call over to Justin Schempp, Vice President of Investor Relations and Financial Reporting. Please go ahead.

女士們，先生們，感謝你們的支持，歡迎來到 Pathward's Financial 2023 財年第一季度投資者電話會議。 （操作員說明）。提醒一下，正在錄製此電話會議。我現在想將電話會議轉交給投資者關係和財務報告副總裁 Justin Schempp。請繼續。

Thank you, operator, and welcome. Pathward Financial's CEO, Brett Pharr; CFO, Glen Herrick; and Deputy CFO, Sonja Theisen, will discuss our operating and financial results for the first fiscal quarter of 2023, after which we will take your questions. Additional information, including the earnings release and the supplemental investor presentation that may be found on our website at pathwardfinancial.com.

謝謝你，運營商，歡迎。 Pathward Financial 首席執行官 Brett Pharr；首席財務官格倫·赫里克；和副首席財務官 Sonja Theisen 將討論我們 2023 年第一財季的運營和財務業績，之後我們將回答您的問題。更多信息，包括收益發布和補充投資者介紹，可在我們的網站 pathwardfinancial.com 上找到。

As a reminder, our comments may include forward-looking statements, including with respect to anticipated results for future periods. Those statements are subject to risks and uncertainties that could cause actual and anticipated results to differ. The company undertakes no obligation to update any forward-looking statements. Please refer to the cautionary language in the earnings release, investor presentation and in the company's filings with the Securities and Exchange Commission, including our most recent filings for additional information covering factors that could cause actual results to differ materially from the forward-looking statements. Additionally, today, we will be discussing certain non-GAAP financial measures on this conference call. References to non-GAAP measures are only provided to assist you in understanding the company's results and performance trends. Reconciliations for such non-GAAP measures are included within the appendix of the investor presentation. Now let me turn the call over to Brett Pharr, our CEO.

提醒一下，我們的評論可能包括前瞻性陳述，包括關於未來時期預期結果的陳述。這些陳述受風險和不確定性的影響，可能導致實際結果和預期結果不同。公司不承擔更新任何前瞻性陳述的義務。請參閱收益發布、投資者介紹和公司提交給美國證券交易委員會的文件中的警示性語言，包括我們最近提交的文件，以獲取更多信息，這些信息涵蓋可能導致實際結果與前瞻性陳述存在重大差異的因素。此外，今天，我們將在本次電話會議上討論某些非 GAAP 財務指標。對非 GAAP 措施的參考僅用於幫助您了解公司的業績和業績趨勢。此類非 GAAP 措施的對賬包含在投資者介紹的附錄中。現在讓我把電話轉給我們的首席執行官 Brett Pharr。

Thank you, everyone, for joining Pathward Financial's First Quarter 2023 Earnings Call. The company performed well during the quarter. Core net income, excluding the impacts of rebranding was $23.2 million compared to $24 million in the prior year, and core earnings per share of $0.81 was up 4% compared to $0.78 per share in the prior year quarter. Our continued focus on our key strategic pillars of asset optimization, deposit optimization and operational simplification helped drive further expansion of our net interest margin, which rose over 100 basis points to 5.62% for the first fiscal quarter compared to 4.59% in the prior year quarter. Our strategy also enabled us to achieve return on average assets and return on average tangible equity that are amongst the top in the industry. Our commercial finance portfolio grew 7% year-over-year and totaled $3 billion at quarter end. Total loans and leases on December 31 were $3.5 billion, a decrease of 5% from $3.7 billion in the prior year. The year-over-year decline in total loans and leases reflects the sale of the student loan portfolio, timing of tax season loans and a few relationship paydowns in our warehouse lending portfolio.

感謝大家參加 Pathward Financial 的 2023 年第一季度財報電話會議。該公司在本季度表現良好。扣除品牌重塑的影響，核心淨收入為 2320 萬美元，上年同期為 2400 萬美元，核心每股收益為 0.81 美元，較上年同期的每股 0.78 美元增長 4%。我們繼續專注於資產優化、存款優化和運營簡化等關鍵戰略支柱，這有助於推動我們的淨息差進一步擴大，第一財季淨息差上升 100 多個基點至 5.62%，而去年同期為 4.59% .我們的戰略還使我們能夠實現平均資產回報率和平均有形資產回報率在行業中名列前茅。我們的商業金融投資組合同比增長 7%，季度末總計 30 億美元。 12 月 31 日的貸款和租賃總額為 35 億美元，比去年同期的 37 億美元下降 5%。貸款和租賃總額的同比下降反映了學生貸款組合的出售、稅收季節貸款的時間安排以及我們倉庫貸款組合中的一些關係還款。

Credit quality across the portfolio remained strong as nonperforming loans of 1.16% were the same as a year ago. As we head into a potential recessionary environment, we remain confident in our active collateral management and the quality of our loan portfolio. On the liability side of the balance sheet, the company continues to demonstrate its proficiency in managing excess deposits by storing them at our program banks.

整個投資組合的信貸質量依然強勁，不良貸款率為 1.16%，與一年前持平。當我們進入潛在的衰退環境時，我們對我們積極的抵押品管理和貸款組合的質量仍然充滿信心。在資產負債表的負債方面，公司通過將超額存款存放在我們的計劃銀行中，繼續展示其管理超額存款的能力。

In the first quarter, off-balance sheet deposits averaged $1.4 billion, earning revenue roughly equivalent to the federal funds effective rate. In addition to generating revenue these excess deposits also serve as a readily available source of liquidity. As of December 31, we had $2.2 billion of customer deposits stored off balance sheet with program banks, a level that is seasonably elevated due to holiday-related gift cards and other products.

第一季度，表外存款平均為 14 億美元，收入大致相當於聯邦基金的實際利率。除了產生收入外，這些超額存款還可以作為隨時可用的流動性來源。截至 12 月 31 日，我們有 22 億美元的客戶存款存儲在計劃銀行的資產負債表外，這一水平由於與假期相關的禮品卡和其他產品而季節性上升。

As we have indicated during the 2 previous quarters, the landscape of the banking as a service market is changing. While we continue to see fewer startups receive funding, our legacy partners are launching new programs and using our services to attract new customers. With our diversified clientele and our long history and experience in banking as a service, we steer clear of the current turmoil experienced by others in the industry. We believe our strong risk and compliance capabilities continue to serve us well during this time of industry transition.

正如我們在前兩個季度所指出的那樣，銀行即服務市場的格局正在發生變化。雖然我們繼續看到越來越少的初創公司獲得資金，但我們的傳統合作夥伴正在推出新計劃並使用我們的服務來吸引新客戶。憑藉我們多元化的客戶群以及我們在銀行即服務方面的悠久歷史和經驗，我們避開了當前業內其他人所經歷的動盪。我們相信，在這個行業轉型時期，我們強大的風險和合規能力將繼續為我們提供良好的服務。

Regarding our re-brand, I'm happy to announce the company completed the remaining efforts during the quarter. Consequently, we received the final $10 million of the original $60 million sale associated with our Meta trademarks. We are pleased to be serving our customers under our new Pathward name, which has been well received by our customers and partners. We look forward to building upon the brand value it provides.

關於我們的品牌重塑，我很高興地宣佈公司在本季度完成了剩餘的工作。因此，我們收到了與我們的 Meta 商標相關的最初 6000 萬美元銷售額中的最後 1000 萬美元。我們很高興以我們的新 Pathward 名稱為我們的客戶提供服務，該名稱已受到我們的客戶和合作夥伴的好評。我們期待在它提供的品牌價值的基礎上再接再厲。

Looking ahead for the remainder of fiscal year 2023, we believe our unique business model allows us to benefit from rising rates, positioning us well to continue delivering solid financial results. Consequently, we've increased our fiscal year 2023 GAAP earnings guidance range, which we now expect to be between $5.55 and $5.95 per share.

展望 2023 財年的剩餘時間，我們相信我們獨特的商業模式使我們能夠從利率上升中受益，使我們能夠繼續提供穩健的財務業績。因此，我們提高了 2023 財年的 GAAP 收益指導範圍，我們現在預計該範圍在每股 5.55 美元至 5.95 美元之間。

Finally, we are well prepared for tax season, which is kicking off in the second fiscal quarter. We have a long history of operational success, our leader in supporting the independent tax industry and serve a major franchise in the business. Our historical experience and operational excellence position us to succeed in unique economic environment of this year's season. We look forward to sharing more on our next earnings call.

最後，我們為第二財季開始的報稅季做好了充分準備。我們擁有悠久的運營成功歷史，是我們支持獨立稅務行業的領導者，並為該行業的主要特許經營服務。我們的歷史經驗和卓越運營使我們能夠在今年季節獨特的經濟環境中取得成功。我們期待在下一次財報電話會議上分享更多信息。

Now let me turn the call over to our Chief Financial Officer, Glen Herrick, who will provide additional detail on the quarter's financials.

現在讓我將電話轉給我們的首席財務官 Glen Herrick，他將提供有關本季度財務狀況的更多詳細信息。

Thank you, Brett. Total GAAP net income for the first quarter was $27.8 million or $0.98 per share, down from the $61.3 million or $2 per share recorded in the prior year quarter. As a reminder, the last fiscal year's quarter included an initial $50 million gain on sale of the Meta trademarks. And this fiscal year's first quarter included the remaining $10 million gain associated with the sale.

謝謝你，布雷特。第一季度的 GAAP 淨收入總額為 2780 萬美元或每股 0.98 美元，低於去年同期的 6130 萬美元或每股 2 美元。提醒一下，上一財年的季度包括最初 5000 萬美元的 Meta 商標銷售收益。本財年第一季度包括與出售相關的剩餘 1000 萬美元收益。

Excluding the onetime gains and expenses associated with rebrand-related activity and severance expenses, core net income of $23.2 million decreased slightly compared to the $24 million in the prior year. Adjusted earnings per share of $0.81 for the quarter represents a year-over-year increase of 4%. The business does not expect to report any additional rebrand-related financial impacts moving forward.

不包括與品牌重塑相關活動和遣散費相關的一次性收益和費用，2320 萬美元的核心淨收入與上一年的 2400 萬美元相比略有下降。本季度調整後每股收益為 0.81 美元，同比增長 4%。該企業預計未來不會報告任何與品牌重塑相關的額外財務影響。

Net interest income grew 17% year-over-year, driven by expansion in Pathward's net interest margin. Total net interest margin for the first quarter of 5.62% increased substantially relative to the 4.59% recorded in the first quarter of fiscal year 2022. We expect our net interest margin to continue to expand given the current rate environment and ongoing optimization of our balance sheet.

在 Pathward 淨息差擴大的推動下，淨利息收入同比增長 17%。第一季度總淨息差為 5.62%，較 2022 財年第一季度的 4.59% 大幅增長。鑑於當前的利率環境和資產負債表的持續優化，我們預計我們的淨息差將繼續擴大.

Provision expense in the first quarter of $9.8 million is a $9.6 million increase from the prior year. However, the prior year benefited from a $12.7 million provision reversal associated with the disposal of the bank's remaining community bank portfolio. GAAP noninterest income declined from $86.6 million in the prior year quarter to $65.8 million in fiscal year 2023. Excluding the $50 million and $10 million trademark sale gain in the first quarters of fiscal years 2022 and 2023, respectively, noninterest income increased 52% year-over-year. The large increase was attributed to fiscal year 2022's losses on the Community Bank portfolio sale and MoneyLion investment write-down. Meanwhile, the current year benefited from revenues associated with off-balance sheet deposit servicing.

第一季度的撥備費用為 980 萬美元，比去年同期增加 960 萬美元。然而，前一年受益於與處置該銀行剩餘的社區銀行投資組合相關的 1,270 萬美元準備金逆轉。 GAAP 非利息收入從去年同期的 8660 萬美元下降到 2023 財年的 6580 萬美元。不包括 2022 財年和 2023 財年第一季度分別 5000 萬美元和 1000 萬美元的商標銷售收益，非利息收入同比增長 52%超過一年。大幅增長歸因於 2022 財年社區銀行投資組合出售和 MoneyLion 投資減記的損失。同時，本年度受益於與資產負債表外存款服務相關的收入。

On the expense side, total GAAP noninterest expense of $105.1 million represents an increase of 27% from the prior year quarter. When adjusting for $3.7 million of rebrand-related items in 2023, expenses of $101.3 million grew 23% year-over-year. This increase resulted primarily from $15.5 million of additional card processing expenses, mostly attributable to the higher rate environment. Other expenses, excluding rebrand-related items, grew at a 4% pace year-over-year.

在費用方面，GAAP 非利息費用總額為 1.051 億美元，比去年同期增長 27%。在調整 2023 年 370 萬美元的品牌重塑相關項目後，1.013 億美元的支出同比增長 23%。這一增長主要來自 1550 萬美元的額外卡處理費用，這主要歸因於利率較高的環境。不包括品牌重塑相關項目的其他費用同比增長 4%。

The company remains well capitalized while continuing to return value to shareholders. During the fiscal 2023 first quarter, the company repurchased 654,000 shares at an average price of $38.10. Through January 20, the company repurchased an additional 478,000 shares at an average price of $45.45.

公司在繼續為股東回報價值的同時，仍保持良好的資本狀況。在 2023 財年第一季度，公司以平均 38.10 美元的價格回購了 654,000 股股票。截至 1 月 20 日，該公司以平均 45.45 美元的價格回購了額外的 478,000 股股票。

As Brett mentioned, we are increasing our guidance for fiscal year 2023. For the year, we expect GAAP earnings per share between $5.55 and $5.95. This guidance assumes a federal funds target rate rises to 5% in the second half of fiscal year 2023 and remains flat thereafter.

正如布雷特提到的那樣，我們正在增加對 2023 財年的指導。對於這一年，我們預計 GAAP 每股收益在 5.55 美元至 5.95 美元之間。該指南假設聯邦基金目標利率在 2023 財年下半年升至 5%，此後保持不變。

That concludes our prepared remarks. Operator, please open the line for questions.

我們準備好的發言到此結束。接線員，請打開問題線路。

Our first question comes from the line of Frank Schiraldi of Piper Sandler.

我們的第一個問題來自 Piper Sandler 的 Frank Schiraldi。

Brett, I just wanted to ask on asked about higher guide. Can you talk a little bit about what is driving that? Is it just early thoughts on tax season are shaping up pretty good? Or what's kind of driving the change linked quarter?

布雷特，我只是想問問關於更高的指南。你能談談是什麼推動了這一點嗎？只是關於稅收季節的早期想法正在形成相當不錯的結果嗎？或者是什麼推動了相關季度的變化？

I think the big thing is there's a slight increase in Fed funds beyond what our original basis was, and so we expect that to show up and are experiencing that starting to show up in higher yields. We think we're well prepared for the tax season as we always are. This is one of our core competencies. And the macro environment for the tax season is positive, but we haven't made any bets on that yet. So it's too early. I mean the IRS just opened up for returns this week. So it's too early for us to make any prospective views of what's going to happen in tax season.

我認為最重要的是聯邦基金略有增加，超出了我們最初的基礎，因此我們預計這種情況會出現，並且正在經歷這種情況開始出現在更高的收益率中。我們認為我們一如既往地為稅收季節做好了充分的準備。這是我們的核心競爭力之一。稅收季的宏觀環境是積極的，但我們還沒有對此下任何賭注。所以現在還為時過早。我的意思是美國國稅局本周剛剛開放退貨。因此，我們現在就稅收季節將要發生的事情做出任何前瞻性的看法還為時過早。

Okay. And then can you talk a little bit about what the guide might imply for loan growth here? Just given overall commercial finance was kind of flattish linked quarter. And I know the ABL and the factoring balances have declined. I'm not sure what you're thinking is a good kind of run rate for commercial finance growth from here.

好的。然後你能談談該指南對貸款增長可能意味著什麼嗎？鑑於整體商業金融是一個持平的連接季度。我知道 ABL 和保理餘額已經下降。我不確定你在想什麼是商業金融增長的良好運行率。

Again, it's a mix of asset classes that are going to behave differently. Working capital is where we're hoping for the growth as we get into a more recessionary-style environment. There likely will be some slowdown in various kinds of term lending. Conversely there, there seems to be a bit of uptick in the -- in our solar financing and other alternative energy financing opportunities.

同樣，它是表現不同的資產類別的組合。隨著我們進入一個更加衰退的環境，營運資金是我們希望增長的地方。各種定期貸款可能會有所放緩。相反，我們的太陽能融資和其他替代能源融資機會似乎有所增加。

So I think it's going to be continually plodding forward as we have been, in making that rotation from 1 asset class, i.e., securities to another. I don't expect it to take off, and I don't expect it to dive or anything like that either.

因此，我認為它會像我們一直以來的那樣繼續緩慢前進，從一種資產類別（即證券）轉向另一種資產類別。我不希望它起飛，也不希望它俯衝或類似的事情。

Okay. I think in the past, you might have talked about sort of double-digit growth in overall in commercial finance. I know is that still kind of a reasonable bogey going forward?

好的。我想在過去，你可能談到過商業金融整體的兩位數增長。我知道這仍然是一個合理的柏忌嗎？

Yes. I mean I think low double digits over time through economic cycles is quite reasonable for us. We want to make sure that we have the yield in it, and that's been some of the challenges. And we've talked about that from a liquidity perspective that's gradually getting washed out. But I mean, I think long term, that is a reasonable assumption.

是的。我的意思是，我認為隨著時間的推移，經濟周期的低兩位數對我們來說是非常合理的。我們想確保我們有收益，這是一些挑戰。我們已經從逐漸被淘汰的流動性角度討論了這一點。但我的意思是，我認為從長遠來看，這是一個合理的假設。

Okay. And then in terms of the -- on the depository side, unless I heard wrong, it sounded like the off-balance sheet deposits maybe were boosted a bit linked quarter given some seasonality. So if that's the case, maybe those come down from whatever this is, taking the $2-billion plus at the end of the quarter.

好的。然後就存款方面而言，除非我聽錯了，否則聽起來資產負債表外的存款可能會因為一些季節性因素而有所增加。因此，如果是這樣的話，也許這些都是從這個數字中得出的，在本季度末獲得 20 億美元以上。

Just wondering how to think about the rest of that, I guess. Do you do you continue to think you -- that remains off balance sheet and you pick up Fed funds on it? Is there opportunity or thoughts to bring it back on balance sheet and given some of the opportunities you can get in terms of yields on the asset side? What's sort of the strategy there overall?

我想只是想知道如何考慮其餘部分。你是否繼續認為你 - 仍然在資產負債表之外並且你從中獲得聯邦基金？是否有機會或想法將其重新帶回資產負債表，並考慮到您可以獲得資產方面收益率的一些機會？那裡的總體戰略是什麼樣的？

Well, a couple of things. You're correct. There is some seasonality in the fourth quarter. And I think in my comments, I highlighted a level that's probably more like core. We do think that -- and this is one of our advantages, that the liquidity is gradually wiping out in the general economy, and there may be some minor shrinkage even at that core just because of what's going on in the economy.

好吧，有幾件事。你是對的。第四季度有一些季節性。我認為在我的評論中，我強調了一個可能更像核心的級別。我們確實認為 - 這是我們的優勢之一，流動性在整體經濟中逐漸消失，並且即使是在核心經濟中也可能會出現一些小幅收縮，僅僅是因為經濟中正在發生的事情。

I don't -- because we have plenty of money in the securities portfolio, I don't need to pull those deposits back on to the balance sheet to fund the next asset rotation. We've got plenty on the balance sheet to do that. And there's no sense in inflating the size of my balance sheet until we kind of keep working through that asset rotation.

我不需要——因為我們在證券投資組合中有很多錢，我不需要將這些存款拉回資產負債表來為下一次資產輪換提供資金。我們的資產負債表上有足夠的資金來做到這一點。在我們繼續努力完成資產輪換之前，擴大我的資產負債表規模是沒有意義的。

Okay. That makes sense. And then just lastly on credit. You talked in the release about the increase in provisioning and the increase in NPAs. I assume was kind of part and parcel the same. I think you talked about one relationship on the commercial finance side. Any additional color you can give on that relationship and hopefully, your comfort in limiting losses there.

好的。這就說得通了。然後最後才賒賬。您在新聞稿中談到了供應的增加和 NPA 的增加。我認為這在某種程度上是一樣的。我想你談到了商業金融方面的一種關係。您可以為這種關係添加任何額外的顏色，並希望您能在限制損失方面感到自在。

Yes. One of the things I talk about all the time is we are a collateral-managed credit facility. We don't do unsecured credit. And even though something might be in a nonperforming, there is a collateral behind it. We're kind of experts at liquidating that, whether it's working capital or working with partners on the equipment and those kinds of things.

是的。我一直在談論的一件事是我們是一個抵押品管理的信貸機構。我們不提供無擔保信貸。即使某些東西可能處於不良狀態，它背後也有抵押品。我們是清算方面的專家，無論是營運資金還是與合作夥伴在設備和其他方面的合作。

And so just because you're seeing nonperforming doesn't mean that, that's a loss. What that means is we're working it down with the collateral that we have. We're seeing continued good performance in the credit portfolio. We're not seeing any negative impacts as of yet. You always have companies coming and going, that's true. But we're not seeing any trends to the negative side at all.

因此，僅僅因為您看到表現不佳並不意味著那是一種損失。這意味著我們正在使用我們擁有的抵押品來解決它。我們看到信貸組合的持續良好表現。到目前為止，我們還沒有看到任何負面影響。你總是有公司來來去去，這是真的。但我們根本沒有看到任何負面趨勢。

Okay. But can you say where that -- is that in working capital? Or is that a term loan? Just trying to get a little bit more color on that.

好的。但是你能說說那是在營運資金中嗎？或者這是定期貸款？只是想在上面增加一點顏色。

Glen, do you want to respond to that? I mean you know, but I don't know what we can disclose on that.

格倫，你想回應嗎？我的意思是你知道，但我不知道我們可以透露什麼。

Yes, that's a term loan, Frank. And I would also note that -- for us, NPLs is a better metric than NPAs. As we continue to mix shift our earning assets into loans from securities, our NPAs are going to go up just as we reduce the securities percentage.

是的，那是定期貸款，弗蘭克。我還要指出——對我們來說，不良貸款是比不良資產更好的衡量標準。隨著我們繼續混合將我們的收益資產轉變為證券貸款，我們的 NPA 將會上升，就像我們降低證券百分比一樣。

And our numbers are pretty low. And so if you get 1, 3-year or $4 million loan, it can spike up short term. But we feel real confident about our outlook.

而且我們的人數非常少。因此，如果您獲得 1 年、3 年或 400 萬美元的貸款，它可能會在短期內飆升。但我們對我們的前景充滿信心。

Our next question comes from Tim Switzer of KBW.

我們的下一個問題來自 KBW 的 Tim Switzer。

I'm on for Mike Perito. On the -- I guess just on the credit conversation that we're having, could you walk us through some of the collateral you have in different pieces of your loan book, particularly some of the higher loss categories such as like the term lending and factoring? And I guess, kind of like run through the terms you have on those as well.

我支持 Mike Perito。關於 - 我想就我們正在進行的信用對話而言，您能否向我們介紹一下您在貸款簿的不同部分中擁有的一些抵押品，特別是一些損失較高的類別，例如貸款和保理？而且我想，有點像遍歷您對這些條款的看法。

So in the working capital arena, these are accounts receivable and inventory. And those kinds of transactions, we either have a borrowing base of receivables where we've preapproved the debtor, which is the one that owes our customer money. In many cases, depending on the situation, we actually have dominion of funds where all the payments are coming straight to us. And obviously, you have a security interest in those things.

因此，在營運資金領域，這些是應收賬款和存貨。對於那些類型的交易，我們要么有一個應收賬款的借款基礎，我們已經預先批准了債務人，也就是欠我們客戶錢的人。在許多情況下，視情況而定，我們實際上擁有資金的支配權，所有付款都直接交給我們。很明顯，你對這些東西有擔保權益。

And we do some things that are kind of unique, at least for a bank and the way that we manage those. In the inventory cases, we have pre-planned buyers often for the inventory or at least appraisals on it. So we know what we would do in the event of liquidation.

我們做了一些獨特的事情，至少對於一家銀行以及我們管理這些事情的方式而言。在庫存情況下，我們通常會預先計劃買家進行庫存或至少對其進行評估。所以我們知道在清算的情況下我們會做什麼。

The equipment arena, it varies a little bit about what it is. Some of it is mission-critical equipment, which means that even in the event of a reorganization bankruptcy, it's mission-critical, and they're going to reaffirm the debt and pay us. So we emphasized that a lot -- or in other cases, we have relationships with third parties who are ready buyers for that, and we regularly work on and cultivate those relationships so that we can take advantage of them.

設備競技場，它是什麼有所不同。其中一些是關鍵任務設備，這意味著即使在重組破產的情況下，它也是關鍵任務，他們將重新確認債務並支付給我們。因此，我們強調了很多 - 或者在其他情況下，我們與準備好購買的第三方建立了關係，我們定期致力於和培養這些關係，以便我們可以利用它們。

So it's not like a traditional C&I lending. It's -- we go in, assuming there's going to be a default and then how would we get out if there was a default and not lose money. So generally, particularly in the working capital where there's a problem, it's because of fraud, not because of an actual weakness in the collateral position.

所以它不像傳統的 C&I 貸款。它是 - 我們進去，假設會出現違約，然後如果出現違約而不賠錢，我們將如何退出。所以一般來說，特別是在存在問題的營運資金方面，這是因為欺詐，而不是因為抵押品頭寸的實際弱點。

Okay. And you -- yes, go ahead.

好的。而你——是的，繼續。

Tim, this is Glen. I would also refer to Page 16 of our investor presentation on the deck, some additional information around our different types of commercial finance. And then at the end of the deck, we have some industry concentration information.

蒂姆，這是格倫。我還想參考我們在甲板上的投資者介紹的第 16 頁，關於我們不同類型的商業融資的一些額外信息。然後在甲板的盡頭，我們有一些行業集中度信息。

Great. Yes, that's helpful. And when you guys stressed the portfolio, run in your stress test, what are some of the scenarios you use? And like which variables are you focusing on? We're just trying to get an idea of like different parts of the loan book would react to certain stressed environments.

偉大的。是的，這很有幫助。當你們對投資組合施加壓力時，在壓力測試中運行時，您使用了哪些場景？你關注哪些變量？我們只是想了解貸款簿的不同部分會對某些壓力環境做出反應。

Yes. So Glen, I'll let you answer that here in just a second. What I would tell you is that we're always looking at every transaction as if it distressed. We certainly look at industry concentrations, what can happen in that industry and adjust appropriately.

是的。那麼格倫，我會讓你馬上在這裡回答這個問題。我要告訴你的是，我們總是把每一筆交易都看成是痛苦的。我們當然會關注行業集中度，了解該行業可能發生的情況並進行適當調整。

A particularly strong thing that we do is we look at the debtor credit book. Again, that's the people that are paying our borrower and make regular decisions about that. And so example of some fairly common high name bankruptcies that occurred recently, 18 months ago, we were out. We wouldn't accept receivables from them.

我們所做的一件特別重要的事情是查看債務人的信用賬簿。同樣，這些人正在向我們的借款人付款並就此做出定期決定。因此，最近（18 個月前）發生的一些相當普遍的高知名度破產的例子，我們已經出局了。我們不會接受他們的應收賬款。

So that's more the kind of thing we do. Each transaction is so unique in this space. It's really not conducive to a portfolio stress-type arrangement that you might be used to in the traditional C&I.

所以這更像是我們所做的事情。在這個空間中，每筆交易都是獨一無二的。這真的不利於您在傳統 C&I 中可能習慣的投資組合壓力型安排。

Okay. I got you. Going back to the guidance a little bit, what is sort of the NIM expectations you have for like Q1 and Q2? Like you're through all the interest rate floors, right? And I mean, you had like 40 basis points of NIM expansion for the last 2 quarters in a row basically. Like is it reasonable to expect that again? Or should it start slowing down?

好的。我接到你了。稍微回到指導，您對 Q1 和 Q2 的 NIM 期望是什麼？就像你經歷了所有的利率下限，對吧？我的意思是，在過去的兩個季度中，NIM 基本上連續擴張了 40 個基點。再次期待這種情況是否合理？還是應該開始放慢速度？

Tim, this is Glen. Yes, like all things, it depends on the mix, where the growth comes from. That said, we will gain NIM just by continuing to remix our balance sheet if rates didn't move at all. But we are comfortable that NIM will pass through 6% in our fiscal year 2023.

蒂姆，這是格倫。是的，就像所有事情一樣，這取決於增長來自何處的組合。也就是說，如果利率根本沒有變動，我們將通過繼續重新組合我們的資產負債表來獲得 NIM。但我們很高興 NIM 將在我們的 2023 財年通過 6%。

Okay. All right, great. And could you provide a little bit of color on like the expense expectations you have within the guidance, assuming like there isn't like a serious economic deterioration?

好的。好吧，太好了。假設沒有嚴重的經濟惡化，你能否提供一些關於你在指導範圍內的支出預期的顏色？

We're not guiding by line item on our income statement. And so our expenses, we have -- for the bank, we have a fair amount of variable expenses that are driven by activity, which relates to revenues. And so those are correlated with the revenue expenses that we have. And our goal is to grow our core expenses at less than half the rate of our revenue growth. And then that's what's factored into our guide.

我們沒有按損益表上的行項目進行指導。因此，我們的費用，我們有——對於銀行來說，我們有相當數量的可變費用，這些費用是由與收入相關的活動驅動的。因此，這些與我們的收入支出相關。我們的目標是以低於收入增長率一半的速度增長我們的核心開支。然後這就是我們指南中考慮的因素。

And that concludes the Pathward Financial First Quarter Fiscal Year 2023 Investor Conference Call. You may now disconnect. Thank you.

Pathward Financial 2023 財年第一季度投資者電話會議到此結束。您現在可以斷開連接。謝謝。