Axos Financial(AX)2023-08-28 16:00Securities Portfolio - As of June 30, 2023, the total securities portfolio was 264.3 million in 2022, representing a decline of approximately 11.8%[49] - The available-for-sale securities portfolio comprised 17.1 billion, with 92.3% in demand and savings accounts and 7.7% in time deposits[52] - The number of total deposit accounts increased to 479,279 in 2023, up from 395,699 in 2022, marking an increase of approximately 21%[60] - Interest-bearing checking and savings accounts rose to 427,299 in 2023, driven by enhanced marketing efforts[60] - Total deposits increased to 13,946,422 in the previous year[62] - Total interest-bearing deposits reached 8,912,452 and 0.85% respectively[62] - Demand deposits amounted to 3,611,889 in the previous year[62] - Savings deposits increased to 4,245,555 and 0.95% in the prior year[62] - Time deposits totaled 1,055,008 and 1.25% in the previous year[62] Capital and Regulatory Compliance - As of June 30, 2023, the Company and the Bank's capital ratios exceeded the minimums necessary to be considered "well-capitalized" under regulatory requirements[91] - The Regulatory Capital Rules require a minimum "common equity Tier 1" (CET1) ratio of 4.5%, a Tier 1 risk-based capital ratio of 6.0%, and a total risk-based capital ratio of 8.0%[88] - The Company and the Bank elected the current expected credit losses (CECL) five-year transition guidance for calculating regulatory capital ratios, which allows adding back 100% of the capital impact from the day one CECL transition adjustment[90] - The capital regulations require savings associations to maintain tangible capital of at least 1.5% of total adjusted assets[108] - The capital conservation buffer of 2.5% is required for banking institutions to avoid restrictions on capital distributions[88] - The Company is not subject to enhanced stress test regulations as it has total consolidated assets below 4,648,597, representing 24.41% of total interest-earning assets, highlighting the company's exposure to interest rate changes[358] - The projected net interest income for the next 12 months is 1,843,498, with a sensitivity to interest rate changes showing a decrease of 1.4% with a 200 basis point increase[363] Employee and Competitive Landscape - The company had 1,455 full-time employees as of June 30, 2023, with no labor union representation[76] - The competitive landscape for banking and financial services is intensifying, with the company focusing on superior service and competitive rates to attract deposits[78] Securities Business Regulations - The Bank is subject to extensive laws and regulations governing its securities business, including compliance with the Dodd-Frank Act, which may increase operational costs[135] - The Bank's ability to make capital distributions, such as cash dividends, is limited by OCC regulations, which may affect its financial flexibility[116] - The Bank must disclose its privacy policy under the Gramm-Leach-Bliley Act, informing consumers of their rights regarding information sharing[124] - The Bank is required to comply with U.S. Treasury's Office of Foreign Assets Control sanctions, which could have serious legal and reputational consequences if violated[130] - The broker-dealers are subject to the SEC's customer protection rule, requiring maintenance of physical possession or control of fully-paid securities and certain cash reserves[140] - The Securities Investor Protection Corporation (SIPC) provides protection for customers up to 250,000 in cash[140]