Green Dot Corp (GDOT) 2011 Q4 法說會逐字稿

Good afternoon, and welcome to the Green Dot Corporation Fourth Quarter 2011 Earnings Conference Call. All participants will be in listen only mode.

(Operator Instructions)

After today's presentation, there will be opportunities to ask questions.

(Operator Instructions)

Please note this event is being recorded. I would now like to turn the conference over to Chris Mammone, Vice President of Investor Relations. Please go ahead.

Thank you and good afternoon. By now everyone should have access to our fourth-quarter 2011 press release. You can find it at www.greendot.com under the Investor Relations section.

Throughout this conference call, we will be presenting non-GAAP financial information, including non-GAAP total operating revenues, adjusted EBITDA, non-GAAP net income, non-GAAP diluted earnings per share, and free-cash flow. This information is not calculated in accordance with GAAP and may be calculated differently than other companies' similarly titled "non-GAAP information."

Quantitative reconciliations of our non-GAAP financial information to their most directly comparable GAAP financial information appears in today's press release and in the appendix of the presentation that accompanies this call.

Also, we are providing 2012 guidance on a non-GAAP basis with a reconciliation to GAAP, which appears in the financial-information section of our Investor Relations Website.

Finally, before we begin our formal remarks, we need to remind everyone that part of our discussion today will include forward-looking statements. These statements are subject to numerous risks and uncertainties that can cause actual results to differ materially from what we expect; and you should, therefore, not put undue reliance on them.

Some of those risks are mentioned in today's Form 8K filing with the Securities and Exchange Commission. Others are discussed in our quarterly report on Form 10Q for the third quarter, which is available at sec.gov.

And with those formalities out of the way, I would like to turn the call over to Steve Streit, Founder, Chairman and Chief Executive Officer of Green Dot Corporation. Steve?

Great. Thank you, Chris. And welcome, everyone, to our Q4 earnings call. Also with me this afternoon is Green Dot's CFO, John Keatley. And after my section, John will walk you through some of the financial highlights for the quarter, and will also provide our 2012 financial outlook.

Q4 was a solid quarter. And 2011 was another strong year for Green Dot. Our Q4 non-GAAP revenue grew 26% year over year, to $123 million. And our full-year non-GAAP revenue grew 29% versus 2010 to $485 million. Q4 non-GAAP earnings grew 40% year over year to $17.8 million. And for the full year we grew non-GAAP earnings by 26% to $68.7 million.

Active cards grew to $4.2 million as of December 31, representing year-over-year growth of 24%. We're very pleased to continue our track record of high growth during 2011, and as outlined in the guidance portion of this call a little bit later, we believe there is much more to come in 2012.

Clearly, one of the year's biggest achievements was receiving approval from the Federal Reserve Board of Governors to purchase Bonneville Bank in Provo, Utah, and become a bank-holding company. This is a huge milestone for Green Dot. And as you can imagine, we're very proud. We believe that owning a bank and becoming a bank-holding company will provide some very important benefits for our company, our customers and our shareholders.

First, Green Dot, as a bank-holding company, is now overseen directly by the Board of Governors of the Federal Reserve System. And our subsidiary bank, Green Dot Bank, is now regulated directly by the Federal Reserve in the state of Utah, with the FDIC providing deposit insurance.

In the long run, we believe that being directly supervised by regulators who understand our business top to bottom will provide a sustainable advantage versus our structure as a non-bank entity with multiple regulators at the state and federal level, and subject to the review and consent of third-party bank-issuing partners and their regulators.

Second, we now have greater creative freedom -- of course, subject to applicable banking rules -- to develop and launch new products and services. Our goal is to always be an innovation machine at Green Dot, and we believe that the bank will provide increased flexibility and speed the market as we roll out a wider range of products to meet the needs of new and existing Green Dot customers.

Third, becoming a bank-holding company strengthens our competitive advantage, as our experience has been that many public-sector entities and other institutions are only allowed to contract directly with a bank for financial services. For example, the United States Treasury and many state governments have regulations that require them to contract directly only with banks. We believe that having a bank that can deal directly with our clients will mitigate many risks inherent in the non-bank-contracting structure and can help open new doors for us with government accounts and other organizations that have similar bank requirements.

Fourth, we expect that acquiring the bank will result in cost savings, as Green Dot accounts migrate to our bank from Synovus Bank. Our bank team, led by Lew Goodwin, is busy beginning the migration of accounts currently on file at Synovus bank onto the new Green Dot Bank, and we expect a substantial majority of the Green Dot branded card portfolio to be issued out of Green Dot Bank by the end of 2012.

Over time, we believe our bank will also contribute to our Company's consolidated revenue and earnings via float income. Finally, we believe the level of regulatory accountability and financial transparency required to be a publicly traded bank-holding company is a good thing for the long-term growth and long-term sustainability of our Company, and that should benefit our investors.

On the topic of vertical integration, we are pleased to tell you about the acquisition of certain assets of eCommLink, also known as ECL. ECL was a card-transaction processor located in Nevada that specialized in prepaid-card processing for a number of programs. We have purchased their technology assets, including their processing platform. Our technology team, headed by [John McElwain], will build upon that platform in order to customize it and make it enterprise-ready for Green Dot's full array of offering.

That build-out will cost us some money, of course. But once in production, we expect this investment to generate significant cost savings and margin expansion. John Keatley will share more financial color on this acquisition in his section of today's broadcast.

So, this now means that Green Dot is the only prepaid company in the space, and one of the few bank-holding companies in all of America that owns and operates all the key assets needed to become a vertically integrated company. For example, going forward, we'll issue the cards from our own bank; process those cards on our own processing platform; create, design and distribute these products to our distribution footprint of 59,000 retailers. We'll sell them via our direct I.T. connectivity into our retailers' POS systems. We load those accounts to our own proprietary Green Dot reload network. And we'll service those customers through Green Dot Websites, phone apps and Green Dot managed call centers in the US and abroad.

Our focus on quality control and efficiency is key to our ability to produce great consumer-financial products at the lowest possible cost. This philosophy is how we sell our products for much less than most of our competitors. It consistently delivers solid revenue growth year on year as we have illustrated in this call.

Okay. Now let's talk about some business developments. We are pleased to report some newly inked renewals with major retail-distribution partners. We have secured new multiyear exclusive agreements with Rite Aid and Kmart. These renewals call for expanded and more prominent in-store placement. And in the case of Kmart, involves a complete re-launch of their prepaid category.

Staying with the distribution theme, you may have seen that we released more detail about our soon-to-launch AARP Foundation product. The AARP Foundation prepaid MasterCard is particularly timely given the federal government March 2013 deadline, when all remaining Social Security Benefit recipients will be required to receive those payments through ACH electronically.

Initially, the card will be available online and at Walgreen's locations nationwide, with rollouts to more Green Dot retailers planned throughout the year.

Okay. Now, I'll hand the call over to John Keatley, with more color on our strong Q4 financial performance; and he'll have an overview of our 2012 guidance. And then after John's report, we'll begin the Q&A section. John?

Thanks, Steve. In Q4, we continued to show strong top-line growth and significant margin expansion, hitting the high end of our revised full-year adjusted EBITDA guidance and growing our adjusted net income by 40% year over year. We also showed strong growth in terms of our operating metrics, with new-card activations up 29% year over year in the quarter and first-time re-loaders growing even faster at 32% year over year.

The first topic that I'd like to discuss is our revenue growth in Q4. As you can see on slide nine, our non-GAAP total operating revenues grew 26% year over year in Q4. Clearly, this is a high rate of growth and it's consistent with our historical growth rate. But it fell short of our revised guidance for the year. The biggest reason for the revenue miss versus guidance was that we misjudged the retention of cards acquired by customers getting tax refunds -- a segment of customers that grew considerably this year.

Our forecasts have been adjusted to accurately reflect the revenues associated with these cards going forward. We also showed strong margin expansion in Q4. Our adjusted EBITDA margin increased nearly three percentage points year over year, from 23.1% last year to 25.9% this year.

We saw efficiency gains in each major expense category, with the exception of other general and administrative expenses, where we incurred higher expenses primarily related to the closing of our bank acquisition.

Q4 was the second quarter that provides a clean year-over-year comparison with respect to our Wal-Mart commission. Looking at Q3 and Q4 together, we saw an increase in our EBITDA margin of approximately 140 basis points in the second half of 2011 versus the second half of 2010. Our non-GAAP net income, shown on slide 11, was $17.8 million; an increase of 40% for the quarter. And our non-GAAP EPS came in at $0.40, a 38% year-over-year increase.

In terms of our key operating metrics, we saw strong growth across the board. Active cards grew 24% year over year to 4.2 million actives as of December 31. Our gross dollar volume, as shown on page three, grew to $3.8 billion, an increase of 41% year over year. And our full-year GDV was $16 billion, an increase of 55% year over year.

The faster growth in GDV relative to active cards is primarily the result of our higher direct-deposit penetration this year. A portion of our GDV from direct deposit grew to 46%, compared to 38% last year. And total funds from direct deposit grew 69% year over year. Cash transfers grew 26% to $9.1 million, drive by both increased reloads from our portfolio of cardholders and more reloads from our network partners' portfolios.

The portion of cash-transfer revenue from third-party reloads increased to 19% during the quarter versus 15% in the year-ago period. New card activations increased 29% year over year to $2 million, with first-time re-loaders growing even faster at 32% year over year. Returning customers continued to be an important source of activation, accounting for 36% of all new-card activations.

We generated very strong cash flows in 2011. We ended the year with $270 million of total cash in investment securities, including $225 million of unrestricted cash and cash equivalents; $31 million of investment securities; $13 million of restricted cash; and no debt. This is an increase of $97 million versus the end of 2010. Clearly, our balance sheet remains a source of strength for the business.

I'd like to talk a little bit about our expectations regarding the financial impact of two recent acquisitions -- Bonneville Bank and the processing assets of eCommLink, a prepaid processor. As Steve mentioned, these two acquisitions and the subsequent integration of these assets into our business are two important components of our vertical-integration strategy that we expect will deliver meaningful cost savings over time. The fees that we pay to Synovus and TSYS account for approximately one-third of the processing expenses on our income statement. We expect that these acquisitions will allow us to significantly reduce these expenses over the next several years as we build out our own in-house card-issuing and processing capabilities.

In terms of our 2012 guidance, we expect another year of very strong top-line and bottom-line growth. Our non-GAAP total operating revenues are expected to grow 20% to 24% based on these key assumptions -- improvement in average active cards over the year of greater than 20%; growth in cash transfers of greater than 20%; and GDV growth in excess of 30% year over year.

Recall that this guidance reflects the fact that we no longer have the Intuit program, which contributed approximately 5% of revenue in 2011. The implied top-line growth on our business, excluding Intuit, is 25% to 29%. Also, I'd like to point out that this revenue was heavily concentrated in the first quarter of the year. So the grow-over in Q1 will be roughly $8 million. And the margin on this revenue was roughly consistent with the rest of our business.

We project adjusted EBITDA growth of 20% to 24%, which implies that our margins will stay roughly flat in 2012, at approximately 25%. This guidance reflects the fact that 2012 adjusted EBITDA growth will be impacted by the investments we continue to make in new growth initiatives.

We expect non-GAAP EPS to grow to approximately $1.85 to $1.90 per share, an increase of 19% to 22% year over year, reflecting higher depreciation costs associated with the heavy CapEx investments in our infrastructure. And with that, I'd like to turn the call back over to Steve. Steve?

Great. Thank you, John; and, Operator, let's go ahead and open the phone lines to receive questions.

(Operator Instructions)

Our first question comes from Glen Fodor at Morgan Stanley.

Hi. Thanks for taking my question. Congratulations on the renewals. Were these early -- just remind me -- were these early renegotiations, or where they up for just a scheduled renewal?

That's a good question. My understanding is -- and I could probably get something more precise -- is they were roughly up for renegotiation, but we never wait until the last day to renew something. So I guess a little bit of both -- they were before the renewal date, but were at -- coming toward the natural conclusion, I guess.

Got it. Okay, understood. And then, as far as financial incentives or changes to the pricing agreement that you had with these retailers, can you give us any sort of color of changes to the contract? Is it in line with what you've seen historically, or is anything (inaudible)?

John can comment better, but they're similar to what we've had historically. And, John?

Yes, that's right -- no dramatic changes in terms. We generally don't discuss individual-retailer economics specifically -- but nothing dramatic.

Okay. Okay, great. And then just on the promos that -- people taking advantage of promotions last quarter -- there were no big areas upside to our estimates and metrics this quarter, so I just want to see from your perspective -- was that taking advantage of promos last quarter or was it additive to your numbers this quarter, or are you seeing any sort of benefits from that yet? Or is this more of, "We'll see it over the next couple quarters"?

Well, a little of both, Glen. We did have some new initiatives in Q4 that were successful and helped drive that new-card-activation number up to 29% and help lift our number of first-time re-loaders up over 30%. We also had some promotions that were delayed until next year. And we also have some promotions that result in contra revenue. And that was the case, again, in Q4. We have our direct-deposit incentives. We also offered incentives for customers to activate online, resulting in some contra revenue. So we saw some impact -- some benefit in Q4. And some of those initiatives were delayed until next year.

All right. Thanks for the color. I appreciate it.

The next question comes from David Scharf at JMP Securities.

Great. Thanks for taking my question.

You bet.

General question about the margin outlook next -- well, I guess, this year, John -- and, particularly your comment about more investment initiatives -- keeping margins flat. I mean, is a fair amount of this associated with just some of the startup or integration costs associated with Bonneville and eComm? Or are we talking about, on average, expectations for more sales-and-marketing expense on a sort of per-new-activation basis?

Yes. I think in terms of the general trend on margins, if you look at the second half of 2011, we saw about a 1.5 point margin expansion over 2010. I think that's a pretty good kind of steady-state run rate -- kind of margin expansion we expect to see in the business.

2012 is an exception for a couple of reasons. As you mentioned, we do have some overlap expenses related to the bank and to building out the processor. We'll be continuing to pay TSYS in 2012 at the same time we're building out our own processing platform. Same with the bank -- we'll be continuing to pay licensing and fees to our -- to Synovus -- while, at the same time we're ramping up our bank and our own issuing capability.

We have a similar issue with our office move. We're taking possession of our new office space in Pasadena right about now, and we'll have to recognize rent expense on it even though we don't actually pay rent or move into the building until the end of the year. And that will result in a negative hit of about $1 million this year as well. So we have some overlap issues this year.

Sales-and-marketing, in general, we do expect some increased advertising cost. As we've mentioned before, we expect online to continue to become a more important channel to us, and we'll allocate a significant amount of advertising dollars to that channel. So those are some of the factor that are kind of impacting our margin expansion next year.

Got it. Just a couple other quick ones -- first, as you look at cash-transfer revenue, in particularly the ATM surcharging -- I know last quarter there was some discussion of the impact of kind of adding the free-ATM network at Wal-Mart. Is there anything you can expand upon there? Was that something that was meaningfully impactful in the quarter?

No. We don't really have anything new to share on that. As we mentioned before, there is a requirement in -- around the middle, in July of 2012 -- that we begin to offer free ATMs on the Wal-Mart portfolio. But we haven't disclosed exactly how we'll do that or the timing. But as we've mentioned before, we expect a retention-and-usage benefit that will largely offset any lost revenue from those ATM transactions.

Got you. And then, lastly, I just want to make sure I understood your commentary related to -- kind of, I think, in your words --misjudging the retention of cards by a lot of those kind of late-tax-refund customers. I mean are you implying that the money wasn't spent as quickly as typically the tax-refund accounts do spend that money, and that's why, perhaps, GDV was down sequentially?

Well, it's -- I'd say, at the higher level, it's a general comment about 2012. We had a strong first quarter -- very strong new-card activations and GDV. And we raised our guidance at that time. One of the things we misjudged and didn't fully appreciate here until the end of the year was just how much shorter the tax-refund cards are in terms of their life and their lifetime revenue. And that impacted us throughout the rest of the year and into Q4.

You mean 2011, though, right?

Oh, sorry. I meant 2011.

Yes, it was just the modeling. I mean the best way to look at it, to be blunt -- it was a modeling mistake. We thought those cards would retain similarly to other kinds of direct-deposit cards, but they don't. So they were not nearly as productive as a regular direct-deposit card. And we fixed the model going forward, but I think you can chalk that one up to a mistake on the model.

Got you.

Is there anything in that that I can tie into the sequential decrease in GDV in the fourth quarter?

You can tie it -- well --

I mean my understanding is a lot of those typically, for tax refunds --

Yes. Yes.

-- they take it out of an ATM. You usually don't rack up GDV. And maybe there's some other explanations for the decrease on the Gross Dollar Volume number.

Yes, that's right. I mean Q4 is a quarter that's largely clean of tax activity in general. The late filing date is October 15. So Q4 is basically a clean quarter with very little activity from tax refunds or tax activity in general. So that would explain sort of the slower growth -- year-over-year growth in GDV in Q4.

Okay, great. Thank you very much.

The next question comes from [Ramsay Elasila] at Jefferies.

Hi, guys.

Hi, Ramsay.

You mentioned float income from Green Dot Bank potentially coming on line at some point. Is that something that you expect in '12? I would assume, if you were migrating some accounts over, given the interest-rate environment, it's probably not going to provide a whole lot of upside there. But I was just wondering if that source of fund is accounted for in your guidance.

After the Fed's speech yesterday, we minimized our return on -- no, it's -- we've always said that the float is minimal. But the balances can get fairly significant. And, John, what did we contribute last year from float? It's like 40, 50 basis points a year or something?

Yes, it's about $1 million of revenue on our average balances. Cash balances were in the neighborhood of [$200,000] over the year. So, yes, about 0.5%.

So if you -- so as those balances grow in the bank, then that $1 million and growing would accrue to us. And so that's a part of that float. But, yes, with interest rates at 40, 50 basis points a year for the kinds of investments we use, it's not going to make anybody rich. But it is an add over time and it is a positive. And if the interest-rate environment increases over time, it could be more positive.

Thanks. On the -- congratulations on the AARP deal as well. I saw that Bancorp bank was the issuer there, rather than Green Dot Bank. And I was just wondering what the reasoning was there. Was it that Green Dot Bank was still sort of tied up in the approval process while the deal was getting structured or --?

Yes, that's very good. That's exactly right. Yes, we sort of had a date by which we had to pick a bank. And, literally, that date was a week before we received approval in November. So Bancorp's a fine bank. Frank Mastrangelo and his team over there are personal friends and good partners. And so we're using them for that card. That's exactly right.

Okay. And one quick last one -- so some of the promotional expenses such as the direct-deposit incentive and the 2% deal with Wal-Mart -- some of your accounting is contra revenue. When do those promotions end? And when they end, do you expect an uptick there in terms of -- maybe those consumers have been incented properly so they might continue spending -- continue being customers? Is that something that -- have those deals rolled off yet, or are they in the process of rolling off? Or what's the timing there?

In most of the deals -- and there are really a number of promotions that fall in that bucket. Most of them are continuing, although on a somewhat restricted basis. We're changing the terms under which we -- or the criteria under which we offer the $10 direct-deposit incentive, just to get more targeted with it and make sure we're really incentivizing the right kind of direct-deposit behavior. So we expect it to ramp down somewhat gradually. But it will always be -- it'll be an ongoing part of our promotion model.

All right. Great. Thanks a lot. That's helpful.

Yes, you bet. Thank you.

Our next question comes from Sanjay Sakhrani at KBW.

Thank you. Good evening. Just a couple of questions -- first, I was just hoping to get some color on your pipeline of distribution deals. And then, just secondly, on the outlook -- I was wondering, one, if that includes the economics related to the renewals and, two, whether or not you assumed any --?

Sanjay, I can't -- I heard the first question about pipeline. I apologize, but I can't hear the call.

Oh, I'm sorry. Can you hear me now?

That's a little better. Thanks.

Okay, great. Sorry about that. So the second question is just on the outlook. I was wondering, one, does that include the economics related to the renewals? And, two, do you assume any pipeline wins out to this year? Thanks.

I can answer the -- well, you want to take a look, John?

Why don't you do pipeline and I'll talk about --?

We'll split it up. So the answer is the pipeline looks good. We're always cautious to count our chickens before they're hatched internally, let alone on a conference call. But I feel like we'll have some good wins this year, and when it's appropriate to talk about them, we will. But I think a pipeline can never be full enough. But I think we have some good opportunities in there. And, then, in terms of whether or not those pipeline opportunities are baked into the forecast -- I'll let John talk about that.

Yes. And, first, in terms of the renewals being reflected in the outlook -- yes, they are. All of our current deal terms are reflected in our outlook for next year. And then in terms of the pipeline -- we put a range -- we have a revenue-growth range of 20% to 24%. We don't need any additional partnership deals or new products to hit the low end of the range. New announcements either in terms of distribution or new products would push us towards the high end of the range.

Okay. And then just -- I'm sorry -- one final one. Just on the bank acquisition -- I was wondering, are there any kind of -- you guys did a good job of explaining some of the areas where you can get some efficiencies and gains. But are there any longer-term opportunities from the bank, such as with your larger partners, in becoming their issuer?

Oh, gosh, you know, possibly. We've had a lot of inbound calls about, hey, gosh, can your bank help us with our programs? It's not something we're interested in doing now. It's not a specific part of our business plan for the bank. If, at some point, we thought there was a strategic reason to issue a card or a program that was not a Green Dot sponsored program, and there was a compelling enough reason, I suppose we would take it under consideration -- meet with our regulators about it and talk it through.

But I wouldn't count on that being any part of our business model anytime soon.

Okay, great. Thank you.

Thank you.

The next question comes from Julio Quinteros at Goldman Sachs.

Hi. It's actually Roman Leal here, in for Julio. Two quick questions on the -- I guess on the margin outlook and, then, kind of your overall outlook. I know you mentioned that in 2012 you're still going to be kind of in this hybrid model where you're still paying total and your bank -- at the same time, doing you're -- you're kind of working towards doing everything in-house. What's the -- can you help us kind of walk through the trajectory there? I mean can 50% of your own processing be done by 2012? Is it less? Is it more? Same thing with the issuance side?

Yes. I think you mentioned, too, though -- you mentioned the bank and the processor. The transition to the bank will be -- will happen quite a bit faster. Our goal is, really, by the end of 2012 to be largely, if not entirely, removed from Synovus over to our own bank.

Building out our processor will take quite a bit longer. That transition will really happen at the end of 2013 -- beginning of 2014, and into 2014 -- as we want to make sure that everything is working appropriately before we ship those accounts over to our own platform.

Okay. And can you help us understand the Wal-Mart relationship with, I believe, two competing tax-refund prepaid cards? What do you think the impact of that has on your business -- particularly in your 1Q outlook?

Well, we talked with the Wal-Mart team, headed up by Kostas Sgoutas, who is one of our new EVPs of revenue, about that question before the call to make sure that we had the latest and best thinking on the matter.

The thought is that it may be that for somebody who elects to have their tax returns done by Jackson Hewitt or H&R Block in the lobby of a Wal-Mart -- and they may, in fact, take the Jackson Hewitt card or the H&R card to get their refund.

At the same time, the Wal-Mart Money Card is being promoted more heavily this year than ever for taxes with entire front-end displays about getting your taxes loaded, and this is a great way to get your tax refund faster and safer, and so forth and so on. And there's a belief that that will drive sales above what they've been historically for that tax product.

So their conclusion was that it's -- at the end of the day -- that they didn't expect it to be a material change in our performance one way or the other, and that with the displays and the promotion, a net positive by the end of the day. So we'll wait and find out, but we're not expecting anything materially negative about it.

Okay, thanks.

The next question comes from Bryan Keane at Deutsche Bank.

Hi, guys. I just had a couple follow-up questions. I guess -- do you expect any other contract renewals in 2012 to impact guidance? In other words, I mean is it possible we'll see other renewals that could move the guidance around a little bit in terms of more margin pressure or expense associated with that renewal?

I wouldn't think so. John's better at the economics, but we've been with our retailers many years. We sell a tremendous amount of product to our retailers. And the relationships are fairly well established. So there could be some minor changes left to right. But the renewals we've had over the years have been fairly consistent. And so we don't see anything radical happening.

Okay. Yes, because I'd think the fear would be if you had any other future renewals that would impact guidance going forward in 2012. So that's good to know.

I guess another question -- just on the tax-refund accounts -- how much revenue does that generate? And how can we get comfortable with the fact that that's not going to be an issue in 2012? I know it's come up a few quarters in a row now, in 2011, that it surprised you guys. Maybe you could just help us get comfortable with that in 2012.

Yes. And the learning there was really that these cards, while they drive a lot of GDV, they account for a lot of direct-deposit volume and -- not that impactful in terms of revenue, and even less impactful in terms of EBITDA. In fact, that's part of the reason that, in Q4, the EBITDA came in in line with plan even though revenue fell a bit short.

We've now gone through a full year. But tax as a portion of our business roughly doubled from 2010 to 2011. And so we've now gone through a full year with that accounting for such a large portion of our business and have a pretty good understanding of it and have fully baked it into our numbers going forward.

There was a real lesson in modeling for it. And you learn as you go. We're a young industry and we try to be an open-minded company. And we do our best to call BS on ourselves when appropriate. So we learned a lot in terms of what kinds of promotions to incent and what kind of behavior. And the tax cards were expensive in that we were paying people $10 to do direct deposit in some cases, and they would have done it anyhow. So we don't need to keep doing that. That was one of the lessons learned. That was expensive.

And they use it, really, as a disbursement card, and they're out of the product almost as quickly as they can run to their nearest ATM. And so that was a lesson. We're glad to have the business. Conversely, by the way, when someone uses a Wal-Mart Money Card or a Green Dot Card, which is where a tremendous amount of our taxes come -- it's not just on programs like Intuit or tax programs. Just in the same way that you may use your bank account and your checking account to receive your taxes, our customers do the same thing with our cards. Those guys are fabulous. They do stay around for a long time, and they're using their cards as part of their long-term financial solution.

So we've learned a lot about how to segment tax customers and how to look at different kinds of segments of acquisition. And that's how you learn and grow. And so that caused the modeling hiccup. But you live and learn.

Okay. Any idea what percentage of revenue the tax portion is, just so we can get a sense of that -- and for 2012?

We have not broken that out specifically yet, no.

Okay. And then, just last question for me -- there are a lot of exciting things going on with the bank, but I guess I'm just curious on any new major product releases expected for 2012. Thanks so much.

Yes. Thank you for the questions. Oh, gosh. I'd love to talk about a lot of them. I can give you a heads up since we're on a public call here. We've been working for quite a bit -- about a year -- behind the scenes on a product that we think will be pretty cool that will not be a prepaid product at all that we think will have tremendous adoption and acceptance from customers. And that'll be part of our new bank. And so as soon as we can roll that out and make sure that it's working great and looking great, we'll share it with all of our investors and the public.

But no question there is a number of product initiatives that have kind of been put on hold, or were put on hold, until the approval of the bank. And now, with the approval of the bank, we've been able to meet with our regulators and discuss some plans and move a little bit more quickly in terms of our new-product-rollout initiative. So I think it's a good question, and one that you should keep an eye out for.

Okay, great. But that is 2012 for that new product?

That'll be 2012 unless I.T. lets me down. And they promise me they won't.

Okay, super. Thanks so much.

Yes, okay.

The next question comes from [Jim Kissane] at Credit Suisse.

Thanks a lot, guys. And not to beat a dead horse, John, but can you give us a better sense of maybe what the cost of building out the processing platform will be over the next couple years? And will you be capitalizing any of those costs, or mostly expensed?

Yes, sure. We announced that we've purchased the assets of the processing platform from eCommLink for about $2.5 million. So that's already done. There will be additional expenses of approximately $10 million, most of which will be capitalized going forward, as we build out the platform. And then there will be ongoing operating costs once the platform has been built out, to operate the platform. So it won't be -- we won't be saving all of the expenses on processing. We'll be spending less on it as we bring it in-house, but we'll continue to have ongoing expenses associated with it as well. So hopefully that gives you a ballpark sense.

Yes, that's great.

So, from a longer-term perspective -- say, 2014, 2015 -- what do you think the margin impact is -- the incremental margins from running your own processing platform? Can you give us a sense there?

Yes. We've shared a couple of numbers in terms of the size of the expense line items we're going after here. If you think of our total processing line item on our P&L, about one-third of that are the fees that we pay to TSYS and Synovus. And it would be heavily weighted towards TSYS -- the processing piece is more expensive. And I'm not planning to give a specific percentage, but a very significant piece of that bucket of expenses will go away once we've brought these functions in-house.

Great. And one last question -- any sense on the outlook for direct deposit, maybe as a percentage of GDV -- any targets there, for this year? Thanks.

We expect it continues to go up. It's part of the reason that GDV will continue to grow faster than active cards. It obviously grew pretty significantly throughout 2011. As I mentioned before, there's really very little tax-refund volume in Q4. So that kind of gives you the year-over-year growth. And the direct-deposit volume gives you a good sense of the growth of the really high-quality portion of the -- of direct deposit. And we expect that trend to continue next year.

Perfect. Thank you.

The next question comes from Tien-Tsin Huang at JPMorgan.

Hi, thanks. Sorry. Good afternoon. Hi, guys.

What can we do for you?

Good, good. Just a few questions, if you don't mind. Just, I guess, first, on the pricing side -- I'm curious about the outlook for both the Wal-Mart and the Green Dot branded cards. Any need to tweak some of the consumer fees in light of what's happening competitively?

Well, we think we're in good shape. You're right that competitors have brought prices down. But they've brought them down to our level or higher. So there was a RushCard announcement today that is more expensive than Green Dot. The Suze Orman Card -- with all due respect to Suze Orman -- and I would never want to peak the ire of a consumer advocate -- but there's a lot of fees on there that we would never charge. And the card itself would certainly not rank among the lowest-priced cards on the market by a long shot.

And the Amex card, as you know, has no monthly fee, but for anyone who uses that card to do just more than one ATM a month, it's way more expensive than the Green Dot product, and it's not an FDIC-insured card; not issued by a bank and you cannot use it for direct deposit.

So when you look at actual true FDIC-insured general-purpose reloadable cards, Tien-Tsin, I'm pretty confident that we're still at the bottom of the market. And I think most consumer reviews report that. So I think what it's done is our pricing both in Wal-Mart and nationwide with our Green Dot brand has forced competitors to come down to our level. But we've not seen anything of any competitor of size that has been below that in a sustainable way.

So we feel good that we're in good shape; having said that, we always reserve the right to look at our marketplace and to look at opportunities for additional retention or for better acquisition, or to do different kinds of promotions with retailers. And we use our pricing power liberally to make sure that we're always number one in the hearts and minds of our consumers.

All right, good. Thanks for that. Just, I guess, in light of so much activity that's happening in the world, I'm curious just in terms of visibility for revenue, card growth -- as you look to 2012 -- is it -- has it changed a lot relative to 2011, because I'm just trying to get a sense of if you've changed your philosophy at all around guidance; if maybe you're letting in a little bit more conservatism given what's happening.

We'd never say that even if we felt it. John, why don't you take that?

Well, I think, Tien-Tsin, the world may not have changed as much as it might seem from reading the media reports and the press releases out there. I think in the retail environment we're finding that things that have worked in the past continue to work. The way customers use our cards has stayed mostly the same. I mean they're doing different things. They're downloading our mobile apps and finding reload locations and ATMs using their cell phone. And they're engaging with the product in a little bit of a different way. And they're more likely to enroll in direct deposit.

But essentially the way they use the product has not changed a whole lot. So we don't think the world has changed quite as much as it might seem from the outside. And so I'd say our visibility is probably about the same as it was in the past.

I think, Tien-Tsin -- to point out something that's interesting -- I thought about that in hearing John's answer -- if you had to pick a point in time when everything should have hit the fan, so to speak, it would have been 2011. I mean, we had the implementation of Durbin. And you had concerns over, "Oh my gosh; Bill Pay was being altered in this way or that way."

And new competitors came on the scene. If you recall, Amex had a big, big splash and Target had a big splash. And there were articles every day about how each article made it sound like the Earth was coming to an end for prepaid. And, in fact, there was, again, just another really significant year of growth off a huge customer base, again, for us -- not to say we take articles of legislation or anything lightly. We don't. As you know, we're very active in making sure that we're always on the right side of those issues. But 2012 looks to be a lot more calm, if you will. There's always going to be things that pop out -- but a lot more calm and a lot more certain, certainly, than 2011. I think that would be a fair statement.

All right, good. And I hope you appreciate why I'm asking, because obviously there's a lot of things that are moving --

Well, yes, I mean -- the guidance is what the guidance is.

Sure.

We don't want to be over-exuberant. We don't want to be overly cautious. And we're trying to strike a balance. 2011 was our first full year as a public company. We thought it was a year where we delivered quite a lot of our promise from the IPO Road Show to our investors and anyone who invested long. And a lot of our investors are long investors.

We did what we told them we'd do. I can't say we've been well rewarded by the market for doing that. And so it's fair to say that as we learn going forward and we look at guidance as a way that we can maybe help make sure we're doing better in our communications.

Okay. No, it's all good. Two more, if you don't mind -- just given the complexity of Q1, is there -- John, can you give us a little bit of help in terms -- you gave us some sense on the revenue in the first quarter, but how about some of the other metrics, given the tough comps with Intuit, and particularly around activations and active card. Anything you can provide -- not to put you on the spot?

Yes. I mean we're really only prepared to give the revenue number now. But, as you can imagine, it certainly impacts the loss of Intuit and the fact that tax-refund volume is heavily concentrated in Q1. We mentioned in the prepared remarks that it's about an $8 million grow over -- or we think that there is about $8 million of revenue from Q1 of 2011 that goes away as a result of not having that program.

And you can expect a similar impact on new-card activation and on active cards. The impact to cash transfers is quite a bit less just because a lot of those tax-refund cards don't reload. But you could expect a roughly similar kind of impact on those two other metrics and a much smaller impact on cash transfers.

Okay, perfect. Last one, I promise, and I'll jump off -- just the use of cash going forward -- obviously it's building up pretty heavily here. I know you did a couple small things, but any limitations that we should consider on use of cash, like acquisitions or even buybacks, things like that? Thanks.

Limitations, meaning things we're allowed to do? Or things that [intend] to do?

Yes, I guess, given the bank license --

Oh, I see. Well --

-- and the charter, and some of the other things that you're aiming to do. I'm curious if there's any kind of limitation there that we should be aware of.

Well, there always are restrictions on minimum liquidity and capital requirements for both the holding company and the bank, but we're radically well above that today.

Right.

So, no. We've been -- maybe it's a personal bent, but we feel like, Tien-Tsin, that -- we get the cash question all the time -- that it's just the right time to have a lot of cash on the balance sheet and the fact that we throw off such a large amount of cash, we think is a high-class problem. Our industry is young. The competitors are being forced to lower prices, as we're seeing -- we mentioned earlier. Investors, private equity and [BCs] aren't investing in growth companies in the prepaid space like they used to. And we think the right time will be coming to make strategic acquisitions and to invest in our own organic new initiatives that will provide way better value for investors than simply paying the dividend or doing something quickly to address a concern.

So we understand the question and we're respectful of it, but we really are resolute in our belief that lots of cash is a good thing at this stage of our Company's development. And as we look at making cool acquisitions, we'll certainly tell you all about it.

All right. Good stuff. Thanks for the time.

You bet. Thanks.

The next question comes from John Rowan at Sidoti & Company.

Good evening.

Hi, John.

Hi, John.

John, I just wanted to make sure I understood the first-quarter guidance. You're not saying that revenue is going to be up $8 million year over year. But there is an $8 million, basically, haircut, if you will, on a comparable basis to 2011 first quarter. Am I understanding that right?

That's right.

Okay. And the card lifetimes -- was there any shift in the typical card lifetime?

We actually did see a little bit of a decline in our average card lifetime, which we attribute to the high proportion of cards coming through the tax-refund channel. A lot of these cards were very short-lived. They get their tax refunds and they're gone.

So over the course of 2011, we saw a little bit -- not a really big movement -- but we did see a little bit of a decline in the average. Now, when you pull out those tax cards, the average lifetime was constant. And on certain segments of customers we saw an increase.

Okay. And then, just one last question -- on the operating margin -- you said it -- relatively flat year over year for 2011? But how does that trend throughout the year? I mean do you see better margins in the first quarter? Just maybe give me a sense of how it trends.

Yes. We typically shy away from that kind of specific, quarter-by-quarter margin commentary. The way we time our promotional and advertising spend can change from year to year. So my comment was really more of an average across the year rather than for any specific quarter.

Okay. And that was -- essentially that -- the operating margin would stay roughly 18% -- what it was in 2011?

Yes. Or we typically talk about our adjusted EBITDA margin; so adjusted EBITDA divided by adjusted non-GAAP revenues -- that would be around 25%.

Okay, fair enough. Thank you.

Thanks.

The next question comes from Greg Smith at Sterne, Agee.

Hey, guys. Just first one -- a quick modeling question on the guidance -- what's your expectation for the tax-rate-share count in 2012?

No real change in tax rights, so around 38% for the year -- very modest increases in the average share count; fairly consistent with what you've seen in the past. I think it's been on the order of 1% per -- or a little less than 1% per quarter, roughly, is where it's been.

Okay. And then the -- this came up briefly -- the AARP business going to the Bancorp was a little bit of a surprise. But is there any possibility that the Wal-Mart business could move either to Green Dot Bank or to the Bancorp possibly, prior to 2015?

Well, it would be inappropriate, Greg, to comment. That's a contract between GE and Wal-Mart and Green Dot. And without GE on the call or others, it would be unfair to even speculate.

Okay, fine. Fair enough. And then, just -- are you seeing -- with all the increased bank fees, there's obviously the expectation that that's going to create a wider population of potential Green Dot customers. Are you seeing any of that? Is there anything tangible that you can talk to, where you're seeing new customers? Any way you can tell where they're coming from? Is this, in fact, happening; and can you provide any color data to convince us of it, I guess?

It's so hard to pin down because if I were to look in your shopping basket and ask why you bought a certain brand of product or a certain product, you may have trouble giving me a definite answer. You may not say, because I saw a commercial last night at 8 pm. It's just -- you just did.

And so people don't always know exactly. We know that greater than half of our customers are banked today. So they're certainly no stranger to banks. But that's been consistent for some time. It's up historically over 11 years. But I mean over the last few years, that's been consistent.

We know our direct-deposit enrollment is skyrocketing. That's probably indicative of a more mainstream bank-familiar customer, because the direct-deposit enrollment process is not fast or easy. You probably had to do it at your job, and other places. You have to fill out a form and take it to your H.R. clerk and go through a process.

So if you've never done that before, it's kind of a hard process to learn. So the fact that we're up so much in direct deposit would lead us to believe that our customers have done it before at another bank or are understanding of how that process works.

And you can see the GDV climbing so dramatically year over year over the past few years, far faster than it did in the old days. And that would also indicate a higher income level and a higher trust and familiarity for the product.

So it's hard to say exactly that Joe Smith came for this reason and Sally Jones came for that reason. But directionally, we see the mainstreaming of the product. And that would be indicative of a product that's having a wider appeal.

Okay, great. Thanks, guys.

Thank you.

Thanks.

The next question comes from Gil Luria at Wedbush Securities.

Good afternoon. Can you help us understand how retailers that have to decide what reload cards they want to put up on a shelf make that decision -- what the role is of the brand on the card? So, specifically, if you have a retailer that has to decide which cards to put on their shelf, how big of a component in that decision is the brand? So you bring to the table the NASCAR brand, the AARP brand, and even the Green Dot brand has a broad value. And you're competing with a card that brings to floor the PayPal brand.

Is that going to be what the retailer decides on? If they like the PayPal brand better, they'll just put that one on the shelf or they'll put both of them on the shelf? Or are there other considerations the retailers -- before they make that decision?

Well, you never know. Well, there's a lot of considerations, so -- and the buyer at the retailer may have one opinion, and by the time it runs up through legal and compliance of the retailer, it may be another opinion. But in general, buyers have different philosophies. The larger the retailer and the more conservative the retailer, the more they are concerned with FinCEN regulations, compliance, customer service, and those kinds of things -- not to imply that all retailers aren't. But they're -- the bigger companies tend to have a more conservative view on infrastructure.

And so the first thing nowadays that retailers need to consider is, if I'm having multiple brands of cards on different networks or multiple reload chits, for lack of a better phrase -- reload [tacks] of different brands -- then it becomes the retailers' obligation to aggregate those loads.

For example, at Green Dot, if we're the only product on the shelf or if we're reloading 100-some-odd bank programs, we can perform that compliance on behalf of the retailer because we see all those transactions and are able to stand in for compliance. If we're not seeing the transactions, that burden of compliance falls completely to the retailer. So those are some of the concerns and issues that rise up in some of the larger retailers who have concerns over compliance issues and money-laundering issues. And then you have the customer-service and variety issues.

But to be fair, we see retailers of different kinds. There are some who feel strongly that this is a financial-service product. They want it highly regulated. They want it iron-clad. They want to make sure that the compliance won't get them into trouble or cause them headline risk. And they've been with Green Dot for years, and continue to be. It's also fair to say that we have other great retailers -- 7-11, being one of them -- who has never been exclusive. And they sell us and a NetSpend product and a Western Union product. And they had a First Data product for a long time, and all kinds of things. And their view is that, "The more the merrier; and let's see how it goes." And we're supportive of all those philosophies because, at the end of the day, we support our retailers' initiatives, whatever they may be.

But putting a regulated financial product on the shelf is different than putting a different brand of chewing gum or a different brand of cola. It involves I.T. connectivity. It involves a heavy compliance burden. And it -- and you're dealing with people's money so you need to be cautious of the company you're dealing with. But I don't know if that answers your question. But all those things are considerations when you walk into a retailer.

Sounds good. Thank you.

The next question comes from Bob Napoli at William Blair.

Thank you. I was hoping you could give a feel for same-store sales growth, if you will. What areas -- what distribution channels are growing fastest for you? How is the direct channel -- what percentage of the business is a direct channel now, and how fast is it growing?

Sure. Hey, Bob. In general, I think, if you look at 2011, the vast majority of our card-sales growth was same-store sales growth. Our main distribution channels and our main retailers at the beginning of the year remained our main retailers at the end of the year, so most of the growth there is same-store growth. We did have some new retail launches. Some of them were smaller retailers. And probably the most significant one, Blackhawk, didn't happen until towards the end of the year. So it didn't have a -- didn't really start to impact the numbers until very late in the year.

Our online channel continues to grow in terms of its significance. And we expect it to continue to grow in 2012. Maybe at some point in the future, we'll break it out specifically. But, for the moment, we haven't done that.

Also, I just wanted to follow up on Greg's earlier question. Sorry, Bob. But the number of diluted share counts for -- that we've assumed for 2012 is around $45.5 million. So I just wanted to give you that number.

Okay.

The Blackhawk, John -- I mean how -- what kind of early signs are you seeing out of Blackhawk -- that network?

Our understanding is it's going fairly well and the rollout continues and sales have been, on a per-store basis, at or above our projections. So we feel good about that.

Steve, I mean were you surprised by Mark leaving? What are your thoughts around -- and maybe a little -- just a little more color on your confidence in the depth of the management team?

Yes. Yes -- happy to talk about it. No, the answer is it was not a surprise for any of us. And, first of all, let me say -- because you knew him and you met him on the Road Show. Mark is a great guy and a good friend to me and our whole executive team. And we thank him for all of his contributions over the years. We had a great party for him last week and had a lot of fun, and got to have some nice closure.

But Green Dot is a different company now than it was nine years ago. And Mark, if you knew him -- for those of you on the call that knew him -- is a startup guy at heart. He likes the feel of a small startup. And it's fair to say that this move wasn't a surprise to anyone internally. And we've done a good job in putting together a very seasoned and senior revenue team over the past year, as well as promoting some long-time internal candidates into leadership positions in revenue, in anticipation that one day this would be the case. And Mark was very helpful and participatory in that.

So the transition of responsibility has been smooth and orderly. And I think it's fair to say we all feel pretty good about our prospects going forward. The team is humming. Mark's been awesome in the transition and very helpful. And life goes on. But he's been a huge contributor and a good friend. And he will be for years to come.

I just -- I missed the number. What was the percentage of the business in the fourth quarter that was direct deposit? And what was it a year ago?

Oh, I think it was 46% in Q4 of our total GDV, which was up from 38% in Q4 of last year.

Okay. And then just your reload network -- the third-party utilization of that network -- how is the growth of that? And do you think that'll remain? Is that a significant competitive advantage for you? Do you view it as such?

Yes we do, actually. The third-party portion of our cash transfer of revenues continues to grow. In Q4 it was 19% of our cash-transfer revenues -- came from third-party programs like RushCard, American Express, PayPal. And that was up from 15% in Q4 of the previous year.

So it continues to account for a larger and larger portion of our cash-transfer volume. And that really is something that sets us apart both with new-card issuers who are -- that are looking for a reload network -- and for retailers that want to hook up with one reliable reload network. We can bring them almost the entire industry of volume into their store.

Thanks. And are there like -- the AARP card -- I mean are there -- how many programs are -- market-moving types of programs are out there? Are you seeing more opportunities or less opportunities? And are there things out there that move the needle? What types of programs would move the needle more than others?

Well, we're very proud of the AARP Foundation program for a couple of reasons. It's unclear what it'll do in sales. That will have to -- listen, I've been in sales a long time. And you never know until you know, and -- no matter what the research says. But we're hopeful it'll do well. But we're very proud to be associated with such a great organization. I'm turning 50 in four weeks. So I'll be an AARP member.

But it's hard to know how it'll sell. But the fact is that we continue to be able to track the Green Dot enterprise-level governmental or pseudo-governmental partnerships of the highest quality, the highest caliber and the highest reputation. And that's sort of a Green Dot thing, if you will.

So we're proud of the relationship and we'll need to see how it sells in the stores. But they're a fabulous organization. And we're proud to be with them. In terms of the other part of your question -- what market-moving programs are out there, whether it's Suze Orman or this one or that one?

Our belief at Green Dot is that the best helping hand we have is sewn to the end of our own arm. The reality is that with our distribution and with our ability to innovate and build new products, and our cash-transfer network that can do all kinds of things besides reloads -- and the fact that we now have a bank that gives us a platform for innovation of new kinds of products that have nothing to do with prepaid, but that attract a segment of Americans that, today, are not attracted to prepaid -- and you put all that together -- we get most excited about the programs that originate within the four walls of Green Dot's palatial facilities here in Monrovia.

So I don't know if you've ever been to our facilities -- you'll know that's a joke. So that's sort of how we view it. But listen, there's a lot of programs out there. And we love being partners with ones that are high-caliber and high-quality like AARP. But we're obviously most excited about the ones that we're able to control.

Thank you.

The next question comes from Andrew Jeffrey at SunTrust.

Hi, guys. Thanks for taking the question.

Sure.

So I understand the dynamic around the need to invest for -- to bring in the bank and to scale the processing platform, and the result on 2012 margin. And I'm not asking to give '13 guidance -- but when we think about the ultimate gains, it sounds like '12 is an investment year, but then -- is it reasonable to think that, then, when you get those investments behind you and you scale the platform and shift volume to Green Dot Bank, that then '13 is kind of a year that looks more normalized and, hence, could be kind of a margin catch-up year? In other words, '12 almost feels like it's a little bit of a transition period for you on the margin side.

Yes. Look, I think that's a reasonable way to look at it. I mentioned that it is going to take some time to complete the processor and start that transition there. It could happen faster. Our hope is that it will happen faster than what I mentioned earlier which would be having the bulk of the transition happening in 2014, really. We'd like to hit a faster timeline than that and see more of that benefit in 2013, and then 2014 becomes the year where you see the full benefit of our own processor being on board, and the bank.

Now, those are the opportunities that we've called out. There are other margin opportunities that we're pursuing. There's also just sort of natural-scale efficiency in the business too. But I think that, in general, that's a fair way to look at it.

Okay. So to be clear, the true period of absolute duplicative costs is '12?

No. You'll have some in '13 for the processor, but the bank will be --

Some, but the full overlap occurs in '12 and you start to gain some of the incremental benefit in '13?

Yes. And then it accelerates more in '14 with the processor.

Okay.

I think that's a good way to look at it. Yes. And I think it also is a clue -- you didn't ask the question, but it occurred to me as I was hearing John respond -- that it's sort of indicative of the way we're thinking about the business. Everything we do about Green Dot -- whether it's the bank or a new product or a processing platform -- is about long-term sustainability. It's the reason why we have a Washington, D.C. presence. And it's the reason why we invest so much on the compliance-and-regulatory side, and work closely with consumer advocates.

We really view ourselves as a long-term, high-quality, high-growth public company. And so we make moves that may not pay off in any give quarter or any given two quarters, but that are essential for the long-term stability and sustainability of the business.

Okay. Fair enough. And then just a couple housekeeping questions -- John, I think you said 45.5 million shares for '12. Did you mean 44.5 million shares?

I believe we've assumed 45.5 million; and if that turns out not to be the case, let me follow up with you.

Okay. It looked like 44.5 million in the supplemental materials.

Oh, in 2012?

Yes.

Okay. Let me follow up to confirm. I believe we assume 45.5 million.

Okay. And then you mentioned an uptick in CapEx. Could you quantify that for us?

Well, I've mentioned the biggest piece of it which is the CapEx associated with shifting to our own processor. And that's about --

That's $10 million.

-- $10 million of spend, of which the vast majority will be capitalized.

Okay. All right, thanks.

Our last question comes from [Mike Grondahl] at Piper Jaffray.

Yes. Thanks for taking my questions. Real quick -- do you think your market share is expanding or declining? And then, secondly, on the AARP business -- how big of an opportunity do you think that is? And of your current customers today, what percent are over the age of 50 or 55? Thank you.

So we know that about 25% of our customers are over the age of 50. So we know that. Next question about market share is a good one. There's only two public companies in the space -- us and NetSpend. And Amex doesn't report any prepaid card sales at all, with any kind of numerical backing. So when you don't know what anyone else is selling, it's hard to know.

So the only thing we know is our relative position to NetSpend and our market share between the two of us. We made some assumptions of what RushCard and some of the other smaller, private programs do. But they're just that -- assumptions.

So given that our growth has been significantly faster -- and this is not in any way meant to be a negative statement, but just a factual statement on reporting -- given that our growth has been so significantly higher than NetSpend's over the past year and a half, it's fair to say that maybe our market share has increased relative to the only public company we have as a comp.

But I couldn't tell you what's going to happen with a Suze Orman or a -- who knows, right? So I guess I don't know. But our growth is certainly not slowing down, and it's certainly significantly higher than the only competitor we're able to see.

Okay. Thank you.

That concludes our question-and-answer session. I would like to turn the conference back over to management for any closing remarks.

No closing remarks per say, except we appreciate everyone hanging in there for the last hour and ten. This has been the album version of the Green Dot Conference Call. We went kind of a little bit long. And we appreciate your time today and look forward to seeing you. We had a number of conferences that we're hitting in San Francisco and New York, and a lot of travel in February. So we look forward to hopefully seeing you all there in person.

The conference is now concluded. Thank you for attending today's event. You may now disconnect.