Axos Financial, Inc. (NYSE:AX) Q4 2021 Earnings Conference Call July 29, 2021 5:00 PM ET Company Participants Johnny Lai - IR Greg Garrabrants - President and CEO Andy Micheletti - EVP and CFO Conference Call Participants Andrew Leisch - Piper Sandler Marla Backer - Sidoti Gary Tenner - D.A. Davidson Michael Perito - KBW Steve Moss - B. Riley Securities Tim Coffey - Janney David Hirons - Wedbush Securities Edward Hemmelgarn - Shaker Investments Operator Hello and welcome to Axos Financial Q4 2021 Earnings C ...

Financial Data and Key Metrics Changes - Axos Financial reported a net income of $53.6 million for Q3 2021, with earnings per diluted share of $0.89, reflecting a year-over-year increase in net interest income and fee income by 21.9% and 43.7% respectively [7][8] - The return on average equity for Q3 2021 was 16.12%, and the efficiency ratio was 42.33%, with tangible book value per share increasing by 17.1% year-over-year to $20.44 [9][21] - Ending loan balances increased by approximately $102 million, up 3.5% annualized from Q2 2021 and up 12.9% year-over-year [9][12] Business Line Data and Key Metrics Changes - Total loan originations for Q3 2021 were $1.8 billion, down 36.8% from $2.9 billion in the same period last year, but up 47.9% year-over-year when excluding H&R Block related loans [12] - The mortgage banking segment generated $9 million in income, compared to $10.7 million in Q2 2021, with a decrease in originations due to rising interest rates [13][20] - The net interest margin for the banking business unit was 4.23%, up from 4.11% in the previous quarter [10][14] Market Data and Key Metrics Changes - The efficiency ratio for the banking business segment was 42.33% for Q3 2021, compared to 40.45% in Q2 2021, attributed to higher professional service expenses and marketing costs [10][21] - Non-performing assets decreased to 1.14% of total loans and leases, down from 1.44% in the previous quarter, indicating strong credit quality [11][18] - The company reported no loans in forbearance as of March 31, 2021, with a total allowance for loan loss of $143.8 million, representing 1.16% of total loans and leases [20][21] Company Strategy and Development Direction - Axos Financial aims to grow loans in the high single digits to low double-digit percentages while maintaining a net interest margin in the mid- to high end of the 3.8% to 4.0% target range [24] - The company announced the acquisition of E*TRADE Advisory Services, which is expected to enhance its scale and capabilities in the RIA custody market [26][33] - The integration of EAS is anticipated to be completed by July 31, 2021, with a focus on leveraging technology to enhance service offerings and cross-selling opportunities [46][65] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the loan growth pipeline, particularly in the multifamily and commercial real estate sectors, despite anticipated margin compression [48][49] - The company remains cautious about the economic environment but expects steady improvement and does not anticipate significant changes to loan loss provisions in 2021 [20][40] - Management highlighted the potential for growth in the securities business, particularly through the integration of cryptocurrency trading capabilities into their platform [37][51] Other Important Information - Axos Financial has access to approximately $2.8 billion of Federal Home Loan Bank borrowings and $2.3 billion of liquidity available at the Federal Reserve discount window [23] - The company continues to invest in technology and infrastructure to support growth across its various business lines [21][35] Q&A Session Summary Question: Integration and Market Share Growth of EAS - Management expects the integration with the broker-dealer to be completed by July 31, 2021, and anticipates immediate growth opportunities post-acquisition [46] Question: Loan Growth and Pipeline Strength - Management noted strength in residential projects, particularly multifamily, and expects to maintain loan growth despite potential rate compression [48][49] Question: Interest in Cryptocurrency - Management confirmed plans to incorporate cryptocurrency custody and trading into their platform, allowing clients to trade and monetize crypto assets [51] Question: Sustainability of NII Levels - Management indicated that the current net interest income level is sustainable, with expectations for continued loan growth [52] Question: Cross-Selling Opportunities with EAS - Management highlighted the potential for cross-selling banking products to RIA clients, which was previously limited [61][62]

Financial Data and Key Metrics Changes - Axos Financial reported a record net income of $54.8 million for Q2 2021, a 32.7% increase from $41.3 million in Q2 2020 [8] - Pre-tax pre-provision income rose to $86.5 million, up 38.1% from $62.7 million in the same quarter last year [8] - Diluted earnings per share increased by 35.8% to $0.91 compared to $0.67 in Q2 2020 [8][11] - The efficiency ratio improved to 40.45% from 43.81% year-over-year [11][26] Business Line Data and Key Metrics Changes - Ending loans and leases increased by approximately $684 million, representing a 25% annualized growth from Q1 2021 and a 14.5% year-over-year increase [9] - Total loan originations for Q2 2021 were $2.04 billion, up 14.2% from $1.79 billion in the same period last year [12] - The gain on sale mortgage banking group generated $10.7 million in income, significantly up from $2.2 million in the corresponding quarter last year [13] Market Data and Key Metrics Changes - The net interest margin for the banking business was 4.11%, compared to 3.91% in the previous quarter and 3.94% in Q2 2020 [15] - Interest-bearing checking and savings deposits were at 45 basis points, with an overall cost of interest-bearing deposits at 85 basis points, a 6 basis point improvement from the previous quarter [10][28] - Total client deposits at Axos Clearing were $773 million, up 14.9% from the September 30 ending balance [28] Company Strategy and Development Direction - The company aims to continue organic loan growth, reinvest in growth initiatives, and pursue opportunistic buybacks and accretive M&A [27] - Axos is focusing on enhancing its digital banking platform and integrating various financial services to improve customer experience and retention [33][32] - The company is optimistic about the long-term growth potential of its mortgage banking and digital consumer banking segments [14][65] Management's Comments on Operating Environment and Future Outlook - Management expressed caution regarding potential headwinds in loan growth due to seasonal trends and market uncertainties [39][40] - The company remains confident in its credit quality, with no loans in forbearance and a low percentage of delinquent loans [19][20] - Management anticipates maintaining a net interest margin between 3.8% and 4% in the near term, despite competitive pressures [75] Other Important Information - The company has a strong capital position with a Tier 1 leverage ratio of 9.08% at the bank, well above regulatory requirements [12] - The allowance for loan losses was $136.4 million, representing approximately 1.17% of total loans and leases [22] - Axos Clearing is set to launch a self-clearing model, enhancing scalability and product offerings [31] Q&A Session Summary Question: Loan growth outlook and potential headwinds - Management indicated that while the pipeline looks strong, there are uncertainties regarding warehouse lending and seasonal trends that could impact growth [39][40] Question: Concerns on credit quality - Management noted that most issues are unique to specific borrowers and that overall credit quality remains stable [42][43] Question: Mortgage segment growth and internal limits - Management confirmed that there is an internal limit for the mortgage segment, but it allows for growth beyond current levels [48][49] Question: Impact of recent market events on trading and clearing services - Management discussed the strategic importance of integrating trading and banking services, emphasizing the growth of digital financial services [53][54] Question: Update on lender finance portfolio - Management expects the lender finance portfolio to stabilize and potentially grow, focusing more on real estate and hard asset opportunities [58][59]

Financial Data and Key Metrics Changes - Axos Financial reported a record net income of $53 million for Q1 2021, a 30% increase from $40.8 million in Q1 2020, despite a $9.1 million increase in loan loss provisions [8][11] - The pretax pre-provision income rose to $87.6 million, marking a 47.6% increase compared to $59.4 million in the same quarter last year [8] - Earnings per share increased by 33.3% to $0.88 per diluted share compared to $0.66 in Q1 2020 [11] - The return on average equity for Q1 2021 was 17.26%, with a book value per share of $20.80, up 14.7% year-over-year [9][11] Business Line Data and Key Metrics Changes - Ending loans and leases increased by approximately $294.1 million, up 11.1% annualized from the previous quarter and up 11.7% year-over-year [9] - Total loan originations for Q1 2021 were $1.78 billion, essentially flat from $1.79 billion in the year-ago period, with significant contributions from multifamily and commercial specialty real estate [12] - The gain-on-sale mortgage banking group generated $19.6 million in income, a substantial increase from $2.8 million in the corresponding quarter last year [12] Market Data and Key Metrics Changes - The net interest margin was reported at 3.84%, up 7 basis points from 3.77% in Q1 2020 [10] - Consumer deposits represented approximately 46% of total deposits, with checking, savings, and money market balances increasing by almost $2 billion from September 30, 2019 [16] - The mortgage warehouse portfolio increased by $249.1 million or 52.5% from the previous quarter, benefiting from record low interest rates [13] Company Strategy and Development Direction - The company aims to maintain an annual net interest margin within a range of 3.8% to 4% while reducing excess liquidity on the balance sheet [35] - Axos Financial is focused on enhancing its digital banking capabilities and plans to roll out new features and product enhancements over the next 12 months [37] - The company continues to explore opportunities in the commercial specialty real estate sector while maintaining conservative underwriting standards [62] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to sustain profitable growth despite uncertainties in the economic environment [37] - The outlook for mortgage banking remains strong, with a solid pipeline of single-family agency mortgages and robust demand for refinancing [13][32] - Management noted that while credit quality remains strong, there are concerns regarding certain commercial real estate loans, particularly in densely populated areas [54] Other Important Information - The company adopted the CECL accounting standard, which resulted in an increase in the allowance for loan losses by $53 million [27] - The effective income tax rate for Q1 2021 was 30%, up from 28% in the prior year [44] Q&A Session Summary Question: Margin outlook and cost of funds - Management indicated that the cost of funds is expected to decline further, particularly as higher-rate CDs mature [46][48] Question: Credit quality concerns - Management acknowledged an increase in special mention and substandard loans but emphasized that the risk of loss is limited due to conservative underwriting [51][52] Question: Housing market outlook - Management noted that while the housing market has performed well overall, there are concerns in specific areas like New York City [54] Question: Specialty commercial real estate opportunities - Management highlighted a focus on multifamily and industrial segments, maintaining a conservative loan-to-value ratio [62]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period ended September 30, 2020 ☐ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number: 001-37709 AXOS FINANCIAL, INC. (Exact name of registrant as specified in its charter) Delaware 33-0867444 (State or other jurisdiction of incorporation or organization)(I.R.S. Employer Id ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 __________________________________________________________________________________________ FORM 10-K Large accelerated filer ☒ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☐ Emerging growth company ☐ ☒ ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended June 30, 2020 ☐ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commissio ...

Axos Financial, Inc. (NYSE:AX) Q4 2020 Earnings Conference Call July 29, 2020 5:00 PM ET Company Participants Johnny Lai - VP, Corporate Development and IR Greg Garrabrants - President and CEO Andrew Micheletti - EVP and CFO Conference Call Participants Andrew Liesch - Piper Sandler Michael Perito - KBW Steve Moss - B. Riley FBR Gary Tenner - D.A. Davidson Edward Hemmelgarn - Shaker Investments Operator Greetings, and welcome to the Axos Financial Fourth Quarter 2020 Financial Results. At this time, all par ...