10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

FORM 10-Q

☒  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2019

☐  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from            to

Commission File Number:  0-22140

META FINANCIAL GROUP INC.®

(Exact name of registrant as specified in its charter)

Delaware	42-1406262
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

5501 South Broadband Lane, Sioux Falls, South Dakota 57108

(Address of principal executive offices and Zip Code)

(605) 782-1767

(Registrant’s telephone number, including area code)

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes ☒  No☐

Indicate by check mark whether the Registrant has submitted electronically and posted on its corporate web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the Registrant was required to submit and post such files).  Yes ☒  No ☐

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or an emerging growth company See the definitions of "large accelerated filer." "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act:

Large accelerated filer	☒	Accelerated filer	☐	Non-accelerated filer	☐	Smaller Reporting Company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).   ☐ YES  ☒ NO

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $.01 par value	CASH	The NASDAQ Stock Market LLC

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Class:	Outstanding at August 2, 2019:
Common Stock, $.01 par value	37,879,833	Shares
Nonvoting Common Stock, $.01 par value	0	Nonvoting shares

META FINANCIAL GROUP, INC.

FORM 10-Q

Table of Contents

PART I - FINANCIAL INFORMATION		2
Item 1.	Financial Statements (Unaudited)	2
	Condensed Consolidated Statements of Financial Condition as of June 30, 2019 and September 30, 2018	2
	Condensed Consolidated Statements of Operations for the Three and Nine Months Ended June 30, 2019 and 2018	3
	Condensed Consolidated Statements of Comprehensive Income for the Three and Nine Months Ended June 30, 2019 and 2018	4
	Condensed Consolidated Statements of Changes in Stockholders’ Equity for the Three and Nine Months Ended June 30, 2019 and 2018	5
	Condensed Consolidated Statements of Cash Flows for the Nine Months Ended June 30, 2019 and 2018	7
	Notes to Condensed Consolidated Financial Statements	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	50
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	63
Item 4.	Controls and Procedures	66
PART II - OTHER INFORMATION		68
Item 1.	Legal Proceedings	68
Item 1A.	Risk Factors	68
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	70
Item 6.	Exhibits	70
SIGNATURES		71

i

PART I - FINANCIAL INFORMATION

Item 1.    Financial Statements.

META FINANCIAL GROUP, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Financial Condition

(Dollars in Thousands, Except Share Data(1))	(Unaudited)
ASSETS	June 30, 2019			September 30, 2018
Cash and cash equivalents	$	100,732		$	99,977
Investment securities available for sale, at fair value	961,897			1,484,160
Mortgage-backed securities available for sale, at fair value	395,201			364,065
Investment securities held to maturity, at cost	138,128			163,893
Mortgage-backed securities held to maturity, at cost	7,414			7,850
Loans held for sale	62,839			15,606
Loans and leases	3,631,031			2,944,739
Allowance for loan and lease losses	(43,505		)	(13,040		)
Federal Home Loan Bank Stock, at cost	17,236			23,400
Accrued interest receivable	19,722			22,016
Premises, furniture, and equipment, net	46,360			40,458
Rental equipment, net	184,732			107,290
Bank-owned life insurance	89,193			87,293
Foreclosed real estate and repossessed assets	29,514			31,638
Goodwill	307,941			303,270
Intangible assets	56,153			70,719
Prepaid assets	22,023			27,906
Deferred taxes	21,630			18,737
Other assets	52,831			35,090
Total assets	$	6,101,072		$	5,835,067
LIABILITIES AND STOCKHOLDERS’ EQUITY
LIABILITIES
Noninterest-bearing checking	$	2,751,931		$	2,405,274
Interest-bearing checking	157,802			111,587
Savings deposits	52,179			54,765
Money market deposits	68,604			51,995
Time certificates of deposit	116,698			276,180
Wholesale deposits	1,628,000			1,531,186
Total deposits	4,775,214			4,430,987
Short-term borrowings	146,613			425,759
Long-term borrowings	209,765			88,963
Accrued interest payable	12,350			7,794
Accrued expenses and other liabilities	134,229			133,838
Total liabilities	5,278,171			5,087,341
STOCKHOLDERS’ EQUITY
Preferred stock, 3,000,000 shares authorized, no shares issued or outstanding at June 30, 2019 and September 30, 2018, respectively	—			—
Common stock, $.01 par value; 90,000,000 and 90,000,000 shares authorized, 37,878,694 and 39,192,063 shares issued, 37,878,205 and 39,167,280 shares outstanding at June 30, 2019 and September 30, 2018, respectively	379			393
Common stock, Nonvoting, $.01 par value; 3,000,000 shares authorized, no shares issued or outstanding at June 30, 2019 and September 30, 2018, respectively	—			—
Additional paid-in capital	578,715			565,811
Retained earnings	238,004			213,048
Accumulated other comprehensive income (loss)	2,308			(33,111		)
Treasury stock, at cost, 489 and 24,783 common shares at June 30, 2019 and September 30, 2018, respectively	(13		)	(1,989		)
Total equity attributable to parent	819,393			744,152
Noncontrolling interest	3,508			3,574
Total stockholders’ equity	822,901			747,726
Total liabilities and stockholders’ equity	$	6,101,072		$	5,835,067

See Notes to Condensed Consolidated Financial Statements.

⁽¹⁾All share and per share data has been adjusted to reflect the 3-for-1 forward stock split effected by the Company on October 4, 2018.

2

META FINANCIAL GROUP, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Operations (Unaudited)

(Dollars in Thousands, Except Share and Per Share Data(1))	Three Months Ended June 30,						Nine Months Ended June 30,
	2019			2018			2019			2018
Interest and dividend income:
Loans and leases, including fees	$	69,732		$	19,056		$	203,900		$	53,344
Mortgage-backed securities	3,063			3,950			8,622			11,755
Other investments	8,837			11,098			32,380			33,234
	81,632			34,104			244,902			98,333
Interest expense:
Deposits	10,395			2,264			35,731			7,106
FHLB advances and other borrowings	4,269			3,429			10,581			9,215
	14,664			5,693			46,312			16,321
Net interest income	66,968			28,411			198,590			82,012
Provision for loan and lease losses	9,112			5,315			51,529			24,726
Net interest income after provision for loan and lease losses	57,856			23,096			147,061			57,286
Noninterest income:
Refund transfer product fees	6,697			7,358			38,559			41,353
Tax advance product fees	34			(46		)	34,757			35,739
Card fees	19,537			22,807			61,939			74,910
Rental income	9,386			—			30,167			—
Loan and lease fees	1,012			1,111			3,185			3,445
Bank-owned life insurance	628			633			1,901			1,952
Deposit fees	2,335			1,134			6,365			2,964
Gain (loss) on sale of securities available-for-sale, net (Includes $440 and ($22) reclassified from accumulated other comprehensive income (loss) for net gains (losses) on available for sale securities for the three months ended June 30, 2019 and 2018, respectively and $649 and ($1,198) for the nine months ended June 30, 2019 and 2018, respectively)	440			(22		)	649			(1,198		)
Gain on sale of loans and leases	1,913			—			3,865			—
Loss on foreclosed real estate	—			—			(185		)	(19		)
Other income	1,808			250			5,363			766
Total noninterest income	43,790			33,225			186,565			159,912
Noninterest expense:
Compensation and benefits	35,176			24,439			117,350			78,951
Refund transfer product expense	287			1,694			7,478			11,665
Tax advance product expense	425			(19		)	3,101			1,736
Card processing	4,613			7,068			18,670			20,798
Occupancy and equipment	7,136			4,720			20,806			14,087
Operating lease equipment depreciation	6,029			—			18,280			—
Legal and consulting	4,065			2,781			12,341			8,436
Marketing	368			416			1,493			1,637
Data processing	260			301			1,018			958
Intangible amortization	4,374			1,664			14,352			6,077
Impairment expense	—			—			9,660			—
Other expense	9,735			5,988			32,467			17,247
Total noninterest expense	72,468			49,053			257,016			161,592
Income before income tax expense	29,178			7,268			76,610			55,606
Income tax (benefit) expense (Includes $110 and ($6) reclassified from accumulated other comprehensive loss for the three months ended June 30, 2019 and 2018, respectively and $162 and ($335) for the nine months ended June 30, 2019 and 2018, respectively)	(1,158		)	476			(3,244		)	12,708
Net income before noncontrolling interest	30,336			6,792			79,854			42,898
Net income attributable to noncontrolling interest	1,045			—			3,045			—
Net income attributable to parent	$	29,291		$	6,792		$	76,809		$	42,898
Earnings per common share
Basic	$	0.75		$	0.23		$	1.96		$	1.48
Diluted	$	0.75		$	0.23		$	1.95		$	1.47

See Notes to Condensed Consolidated Financial Statements.

⁽¹⁾All share and per share data has been adjusted to reflect the 3-for-1 forward stock split effected by the Company on October 4, 2018.

3

META FINANCIAL GROUP, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Comprehensive Income (Unaudited)

(Dollars in Thousands)	Three Months Ended June 30,						Nine Months Ended June 30,
	2019			2018			2019			2018
Net income before noncontrolling interest	$	30,336		$	6,792		$	79,854		$	42,898
Other comprehensive income (loss):
Change in net unrealized gain (loss) on debt securities	16,897			(9,905		)	48,157			(53,377		)
(Gain) loss realized in net income	(440		)	22			(649		)	1,198
	16,457			(9,883		)	47,508			(52,179		)
Unrealized gain (loss) on currency translation	221			—			(24		)	—
Deferred income tax effect	4,106			(2,447		)	11,590			(14,412		)
Total other comprehensive income (loss)	12,572			(7,436		)	35,894			(37,767		)
Total comprehensive income (loss)	42,908			(644		)	115,748			5,131
Total comprehensive income attributable to noncontrolling interest	1,045			—			3,045			—
Comprehensive income (loss) attributable to parent	$	41,863		$	(644	)	$	112,703		$	5,131

See Notes to Condensed Consolidated Financial Statements.

4

META FINANCIAL GROUP, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Changes in Stockholders' Equity (Unaudited)

(Dollars in Thousands, Except Share and Per Share Data⁽¹⁾)

	Meta Financial Group, Inc. Stockholders' Equity
Three Months Ended June 30, 2019	Common Stock			Additional Paid-in Capital		Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock			Total Stockholders’ Equity			Noncontrolling Interest			Total Equity
Balance, March 31, 2019	$	395		$	576,406	$	258,600		$	(10,264	)	$	(4,956	)	$	820,181		$	3,528		$	823,709
Cash dividends declared on common stock ($0.05 per share)	—			—		(1,931		)	—			—			(1,931		)	—			(1,931		)
Issuance of common shares due to exercise of stock options	—			37		—			—			—			37			—			37
Share repurchases	(16		)	16		(43,000		)	—			(13		)	(43,013		)	—			(43,013		)
Retirement of treasury stock	—			—		(4,956		)	—			4,956			—						—
Stock compensation	—			2,256		—			—			—			2,256			—			2,256
Total other comprehensive income	—			—		—			12,572			—			12,572			—			12,572
Net income	—			—		29,291			—			—			29,291			1,045			30,336
Net investment by (distribution to) noncontrolling interests	—			—		—			—			—			—			(1,065		)	(1,065		)
Balance, June 30, 2019	$	379		$	578,715	$	238,004		$	2,308		$	(13	)	$	819,393		$	3,508		$	822,901
Nine Months Ended June 30, 2019
Balance, September 30, 2018	$	393		$	565,811	$	213,048		$	(33,111	)	$	(1,989	)	$	744,152		$	3,574		$	747,726
Adoption of Accounting Standards Update 2014-09, net of income taxes	—			—		1,502			—			—			1,502			—			1,502
Adoption of Accounting Standards Update 2016-01	—			—		475			(475		)	—			—			—			—
Cash dividends declared on common stock ($0.15 per share)	—			—		(5,874		)	—			—			(5,874		)	—			(5,874		)
Issuance of common shares due to exercise of stock options	—			92		—			—			—			92			—			92
Issuance of common shares due to restricted stock	3			—		—			—			—			3			—			3
Issuance of common shares due to ESOP	—			2,010		—			—			—			2,010			—			2,010
Share repurchases	(17		)	17		(43,000		)	—			(2,980		)	(45,980		)	—			(45,980		)
Retirement of treasury stock	—			—		(4,956		)	—			4,956			—			—			—
Stock compensation	—			10,785		—			—			—			10,785			—			10,785
Total other comprehensive income	—			—		—			35,894			—			35,894			—			35,894
Net income	—			—		76,809			—			—			76,809			3,045			79,854
Net investment by (distribution to) noncontrolling interests	—			—		—			—			—			—			(3,111		)	(3,111		)
Balance, June 30, 2019	$	379		$	578,715	$	238,004		$	2,308		$	(13	)	$	819,393		$	3,508		$	822,901

5

	Meta Financial Group, Inc. Stockholders' Equity
Three Months Ended June 30, 2018	Common Stock		Additional Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock			Total Stockholders’ Equity			Noncontrolling Interest		Total Equity
Balance, March 31, 2018	$	291	$	265,491		$	200,753		$	(21,166	)	$	(1,666	)	$	443,703		$	—	$	443,703
Cash dividends declared on common stock ($0.04 per share)	—		—			(1,261		)	—			—			(1,261		)	—		(1,261		)
Shares repurchased	—		—			—			—			(5		)	(5		)	—		(5		)
Stock compensation	—		2,119			—			—			—			2,119			—		2,119
Total other comprehensive (loss)	—		—			—			(7,435		)	—			(7,435		)	—		(7,435		)
Net income	—		—			6,792			—			—			6,792			—		6,792
Balance, June 30, 2018	$	291	$	267,610		$	206,284		$	(28,601	)	$	(1,671	)	$	443,913		$	—	$	443,913
Nine Months Ended June 30, 2018
Balance, September 30, 2017	$	288	$	258,144		$	167,164		$	9,166		$	(266	)	$	434,496		$	—	$	434,496
Cash dividends declared on common stock ($0.12 per share)	—		—			(3,778		)	—			—			(3,778		)	—		(3,778		)
Issuance of common shares due to exercise of stock options	—		147			—			—			—			147			—		147
Issuance of common shares due to restricted stock	2		—			—			—			—			2			—		2
Issuance of common shares due to ESOP	1		1,605			—			—			—			1,606			—		1,606
Shares repurchased	—		(726		)	—			—			(1,405		)	(2,131		)	—		(2,131		)
Stock compensation	—		8,440			—			—			—			8,440			—		8,440
Total other comprehensive (loss)	—		—			—			(37,767		)	—			(37,767		)	—		(37,767		)
Net income	—		—			42,898			—			—			42,898			—		42,898
Balance, June 30, 2018	$	291	$	267,610		$	206,284		$	(28,601	)	$	(1,671	)	$	443,913		$	—	$	443,913

See Notes to Condensed Consolidated Financial Statements.

⁽¹⁾All share and per share data has been adjusted to reflect the 3-for-1 forward stock split effected by the Company on October 4, 2018.

6

META FINANCIAL GROUP, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows (Unaudited)

	Nine Months Ended June 30,
(Dollars in Thousands)	2019			2018
Cash flows from operating activities:
Net income	$	79,854		$	42,898
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation, amortization and accretion, net	41,290			27,995
Stock compensation	10,785			8,440
Provision (recovery):
Loan and lease losses	51,529			24,726
Deferred taxes	(14,468		)	488
Loans held for sale:
Originations	(104,121		)	—
Purchases	(12,643		)	—
Proceeds from sales	95,663			—
Net change	15,925			—
Fair value adjustment of foreclosed real estate	139			29
Net realized (gain) loss:
Other assets	(54		)	(1		)
Foreclosed real estate or other assets	185			19
Available for sale securities, net	(649		)	1,198
Loans held for sale	(3,650		)	—
Leases receivable and rental equipment	(2,598		)	—
Net change:
Other assets	(15,957		)	577
Accrued interest payable	4,556			1,425
Accrued expenses and other liabilities	18,785			4,879
Accrued interest receivable	2,294			1,555
Change in bank-owned life insurance value	(1,900		)	(1,952		)
Impairment on rental equipment	6,194			—
Impairment of intangibles	111			—
Net cash provided by operating activities	171,270			112,276
Cash flows from investing activities:
Available for sale securities:
Purchases	(297,548		)	(418,699		)
Proceeds from sales	720,376			312,863
Proceeds from maturities and principal repayments	110,810			115,878
Held to maturity:
Proceeds from maturities and principal repayments	24,809			29,752
Loans and leases:
Purchases	(219,551		)	(95,169		)
Proceeds from sales	13,069			19,961
Net change	(530,215		)	(238,679		)
Proceeds from sales of foreclosed real estate or other assets	1,905			244
Federal Home Loan Bank stock:
Purchases	(606,756		)	(713,444		)
Redemption	612,920			767,120
Rental equipment:
Purchases	(111,150		)	—
Proceeds from sales	6,551			—
Net change	1,868			—
Premises and equipment:
Purchases	(11,944		)	(5,176		)
Proceeds from sales	101			—
Net cash (used in) investing activities	(284,755		)	(225,349		)
Cash flows from financing activities:
Net change:
Checking, savings, and money market deposits	408,951			219,909
Time deposits	(159,611		)	(66,486		)
Wholesale deposits	96,763			144,786
FHLB and other borrowings	110,000			(415,000		)
Federal funds	(287,000		)	(963,000		)
Securities sold under agreements to repurchase	(36		)	754

7

Net investment by (distribution to) noncontrolling interests	(3,111		)	—
Proceeds from other liabilities	7,525
Principal payments:
Other liabilities	(9,404		)	—
Capital lease obligations	(64		)	(46		)
Cash dividends paid	(5,874		)	(3,778		)
Purchase of shares by ESOP	2,010			1,606
Issuance of restricted stock	3			2
Proceeds from exercise of stock options and issuance of common stock	92			147
Shares repurchased	(45,980		)	(2,131		)
Net cash provided by (used in) financing activities	114,264			(1,083,237		)
Effect of exchange rate changes on cash	(24		)	—
Net change in cash and cash equivalents	755			(1,196,310		)
Cash and cash equivalents at beginning of year	99,977			1,267,586
Cash and cash equivalents at end of year	$	100,732		$	71,276

META FINANCIAL GROUP, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows (Con't.)

	Nine Months Ended June 30,
	2019			2018
Supplemental disclosure of cash flow information
Cash paid during the period for:
Interest	$	19,220		$	17,746
Income taxes	(247		)	8,211
Franchise taxes	184			199
Other taxes	539			129
Supplemental schedule of non-cash investing activities:
Transfers
Loans and leases to foreclosed real estate or other assets	105			29,922
Loans and leases to rental equipment	229			—
Loans transferred to held for sale	39,452			—
Purchases/Sales of investment securities accrued, not settled
Purchases - Available for sale	1,721			4,117
Securities transferred from held-to-maturity to available-for-sale	—			306,000
Short- and long-term borrowings transferred from other liabilities	20,026			—

See Notes to Condensed Consolidated Financial Statements.

8

NOTE 1. BASIS OF PRESENTATION

The interim unaudited Condensed Consolidated Financial Statements contained herein should be read in conjunction with the audited consolidated financial statements and accompanying notes to the consolidated financial statements for the fiscal year ended September 30, 2018 included in Meta Financial Group, Inc.’s (“Meta” or the “Company”) Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on November 29, 2018.  Accordingly, footnote disclosures which would substantially duplicate the disclosures contained in the audited consolidated financial statements have been omitted.

The financial information of the Company included herein has been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial reporting and has been prepared pursuant to the rules and regulations for reporting on Form 10-Q and Rule 10-01 of Regulation S-X.  Such information reflects all adjustments (consisting of normal recurring adjustments) that are, in the opinion of management, necessary for a fair presentation of the financial position and results of operations for the periods presented. The results of the three- and nine-month periods ended June 30, 2019 are not necessarily indicative of the results expected for the fiscal year ending September 30, 2019.

All share and per share data reported in this Form 10-Q has been adjusted to reflect the 3-for-1 forward stock split of the Company's common stock effected by the Company on October 4, 2018.

Certain prior year amounts have been reclassified to conform to the current year financial statement presentation. These changes and reclassifications did not impact previously reported net income or comprehensive income.

Certain amounts in the Recorded Investment table presented in Note 4 to the consolidated financial statements have been restated from what was previously reported as of September 30, 2018 on Form 10-K.

Loan and lease tables have been conformed to be consistent with the Company's updated presentation of its lending portfolio. The new presentation includes expanding the commercial and consumer finance portfolio to present the lending categories that are included in each, presenting the warehouse finance portfolio as its own category, and condensing the community bank loan categories. Warehouse finance loans were previously included in the consumer finance portfolio. All current and prior period numbers are reflective of this new presentation and total loan and lease balances remained unchanged.

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RECENTLY ADOPTED ACCOUNTING STANDARDS UPDATES ("ASU")

Significant accounting policies in effect and disclosed within the Company’s most recent audited consolidated financial statements as of September 30, 2018 remain substantially unchanged with the exception of the policies impacted by the adoption of noted ASUs below.

Adopted ASUs

Revenue Recognition - The Company adopted ASU 2014-09, Revenue from Contracts with Customers (Topic 606), subsequent related Updates (collectively, ASU 2014-09), and ASU 2016-04, Liabilities - Extinguishments of Liabilities (Subtopic 405-20): Recognition of Breakage of Certain Prepaid Stored-Value Products on October 1, 2018. ASU 2014-09 modifies the guidance used to recognize revenue from contracts with customers for transfers of goods or services and transfers of non-financial assets, unless those contracts are within the scope of other guidance. Upon adoption, the Company recorded a cumulative-effect adjustment of $1.5 million to retained earnings, net of tax, due to changes in timing of revenue recognition from breakage of unregistered, unused prepaid cards in the Company’s Meta Payment Systems (MPS) division. Refer to Note 13. Revenue from Contracts with Customers for additional information.

9

Financial Instruments - The Company adopted ASU 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Liabilities and related Updates (collectively, ASU 2016-01) on October 1, 2018. ASU 2016-01 makes several revisions to Subtopic 825-10, including that ASU 2016-01: (1) requires equity investments to be measured at fair value with changes in fair value recognized in net income, (2) simplifies impairment assessment of equity investments without readily determinable fair value, (3) eliminates requirement to disclose methods and significant assumptions used to estimate fair value of financial instruments measured at amortized cost, (4) requires the use of an exit price notion when measuring fair value of financial instruments for disclosure purposes, and (5) requires separate presentation of financial assets and liabilities by measurement category and form of financial asset on the balance sheet and accompanying notes. Upon adoption, the Company recorded a cumulative-effect adjustment that reclassed $0.5 million, net of tax, from accumulated other comprehensive income to retained earnings, due to the Company’s cumulative change in fair value of equity securities with readily determinable fair value. Refer to Note 6. Securities for additional information.

The Company also adopted the following ASUs on October 1, 2018, none of which had a material impact on the Company’s consolidated financial statements.

– ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments

– ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash

– ASU 2017-01, Clarifying the Definition of a Business

– ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment

– ASU 2017-05, Other Income - Gains and Losses from Derecognition of Non-Financial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and accounting for Partial Sales of Non-Financial Assets

– ASU 2018-07, Compensation - Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting

ASUs to be Adopted

Leases - ASU 2016-02, Leases (Topic 842), and related Updates (collectively Topic 842) will become effective for the Company on October 1, 2019. For lessees, Topic 842 establishes a right-of-use (ROU) model that requires a lessee to recognize a ROU asset and lease liability on the balance sheet for all leases with a term longer than 12 months. Leases will be classified as finance or operating, with such classification affecting the pattern and classification of expense recognition in the income statement. For lessors, the guidance with Topic 842 is largely unchanged from current guidance.

A modified retrospective transition approach is required. An entity may choose to use either (1) the standard’s effective date or (2) the beginning of the earliest comparative period presented in the financial statements, as the date of initial application. The Company expects to adopt Topic 842 using the effective date, October 1, 2019, as the date of initial application. Consequently, financial information will not be updated and disclosures required under Topic 842 will not be provided for dates and periods before October 1, 2019.

FASB has released several updates to Topic 842 through subsequent ASUs, many of which allow for practical expedients in transition. The Company expects to elect the ‘package of practical expedients’, which permits the Company to not reassess under the new standard the Company’s prior conclusions about lease identification, lease classification and initial direct costs. The Company does not expect to elect the use-of-hindsight or the practical expedient pertaining to land easements, with the latter not being applicable to the Company. The new standard also provides practical expedients for a lessee’s and lessor’s ongoing accounting. The Company expects to elect the short-term lease recognition exemption for all leases that qualify.

Management has evaluated the Company’s leasing contracts and activities and is developing methodologies and processes to estimate and account for right-of-use assets and lease liabilities based on the present value of future lease payments. While the recognition of right-of-use assets will increase total consolidated assets as well as the Company’s risk-weighted assets, management does not expect the impact to capital ratios to be material. The adoption of this guidance is not expected to result in a material change to lessee expense recognition. Management expects the changes in lessor accounting to result in earlier recognition of expense due to a narrower definition of initial direct costs and presentation changes on the income statement due to costs excluded from contract consideration that are reimbursed by the lessee, in addition to other operational impacts.

Other Upcoming ASUs - Refer to the Company’s most recently audited consolidated financial statements for the year ended September 30, 2018 for the latest update on other ASUs relevant to the Company and not yet adopted as of June 30, 2019.

NOTE 3. ACQUISITIONS

The Company acquired Crestmark Bancorp, Inc. ("Crestmark") and its bank subsidiary, Crestmark Bank, on August 1, 2018 for a purchase price of $295.8 million paid by issuance of 9,919,512 shares of Meta common stock. The initial accounting for certain liabilities and goodwill were incomplete and the amounts recorded were considered provisional. The Company recognized certain measurement period adjustments, discussed below, as of June 30, 2019. The amount of goodwill recorded remains provisional, as well as the other assets and liabilities noted in the table below. The measurement period remains open for the Crestmark acquisition until August 1, 2019. The following table summarizes the allocation of the purchase price to net assets of Crestmark as of the August 1, 2018 acquisition date.

(Dollars in Thousands)	Estimated fair value as previously reported(a)		Measurement period adjustments			Fair value as adjusted
Rental Equipment	$	98,977	$	(3,355	)	$	95,622
Intangible assets	28,253		(117		)	28,136
Goodwill	204,547		4,671			209,218
Accrued expenses and other liabilities	88,301		1,199			89,500
Net other assets	55,464		—			55,464
Noncontrolling interest	3,167		—			3,167
Purchase price	295,773		—			295,773

^(a) As previously reported in the Company's Annual Report on Form 10-K for the fiscal year ended September 30, 2018

Measurement Period Adjustments and Impairment - DC Solar

The Company previously purchased a portfolio of mobile solar generators ("MSGs") from DC Solar Solutions, Inc. and certain of its affiliates, a relationship in the Company's solar leasing business, and, in turn, leased the MSGs to DC Solar Distribution, Inc., an affiliate of DC Solar Solutions. During the second fiscal quarter of 2019, the Company became aware that the DC Solar entities and their affiliates filed for bankruptcy and the entities, including their principals, are subjects of ongoing federal investigations involving allegations of fraudulent misconduct. The Company had three separate operating leases with DC Solar - two of the transactions were included in the acquired Crestmark balances on August 1, 2018. The third transaction was originated in August 2018 after the Crestmark acquisition date. The Company considered the bankruptcy filing and fraud allegations as new facts and circumstances and concluded the alleged fraud existed at the acquisition date for the acquired DC Solar transactions. As a result, the identified impairment for the acquired DC Solar transactions and other related adjustments were recorded as measurement period adjustments to the acquired assets and liability amounts recognized and were offset through provisional goodwill. The impairment and related adjustments for the DC Solar transaction originated post-acquisition are reflected in current earnings.

The Company has repossessed 173 of the 176 underlying assets and is in the process of performing repairs and general maintenance to the assets where needed to ensure they are in prime condition for re-lease. As of June 30, 2019 the Company is continuing its repossession efforts with respect to the remaining three units. The timing and extent to which the Company will be able to re-lease the underlying assets remains uncertain as the Company is actively marketing the units. The adjustments to goodwill and impairment recognized for the DC Solar events reflect the Company's best estimate of the potential loss incurred, based on the Company's present understanding of the relevant facts. Assumptions utilized in the estimate included recoverability of the MSGs and the Company's ability to re-lease them, contractual rents, and residual values. As new facts and circumstances become available, the Company will assess any remaining exposure with respect to these DC Solar matters to determine whether additional adjustments to goodwill and/or impairment loss are necessary. As long as the required criteria under GAAP are met, the Company will continue to account for adjustments to the acquired DC Solar transactions as adjustments to goodwill until the measurement period closes, which will not extend beyond August 1, 2019. During the fiscal quarter ended March 31, 2019, the Company recognized a net decrease in net income of $6.6 million and a net decrease of $8.5 million in regulatory capital as a result of the DC Solar bankruptcy and ongoing federal investigation. There were no additional adjustments recorded due to the DC Solar events in the three months ended June 30, 2019.

Measurement Period Adjustments - Other

The Company recorded additional measurement period adjustments in the second and third fiscal quarters of 2019 for provisional tax and compensation liabilities assumed through the Crestmark acquisition. The Company obtained additional information about facts and circumstances existing at the Crestmark acquisition date that resulted in an increase to liabilities and goodwill recognized of $2.2 million.

NOTE 4. LOANS AND LEASES, NET

Loan and lease tables have been conformed to be consistent with the Company's updated categorization of its lending portfolio between National Lending and Community Banking.

Loans and leases at June 30, 2019 and September 30, 2018 were as follows:

	June 30, 2019			September 30, 2018
National Lending	(Dollars in Thousands)
Asset based lending	$	615,309		$	477,917
Factoring	320,344			284,221
Lease financing	341,957			265,315
Insurance premium finance	358,772			337,877
SBA/USDA	99,791			59,374
Other commercial finance	99,677			85,145
Commercial finance	1,835,850			1,509,849
Consumer credit products	155,539			80,605
Other consumer finance	164,727			189,756
Consumer finance(1)	320,266			270,361
Tax services	24,410			1,073
Warehouse finance(1)	250,003			65,000
Total National Lending	2,430,529			1,846,283
Community Banking
Commercial real estate and operating	877,412			790,890
Consumer one-to-four family real estate and other	256,853			247,318
Agricultural real estate and operating	61,169			60,498
Total Community Banking	1,195,434			1,098,706
Total gross loans and leases	3,625,963			2,944,989
Allowance for loan and lease losses	(43,505		)	(13,040		)
Net deferred loan origination fees (costs)	5,068			(250		)
Total loans and leases, net(2)	$	3,587,526		$	2,931,699

⁽¹⁾ Warehouse finance loans are presented in their own line. Previously these balances were included with consumer finance loans. Prior period balances have also been adjusted to reflect this change.

⁽²⁾ As of June 30, 2019, the remaining balance of acquired loans and leases from the Crestmark acquisition was $402.4 million and the remaining balances of the credit and interest rate mark discounts related to the acquired loans and leases held for investment were $6.8 million and $3.2 million, respectively, while the remaining balance of the interest rate mark premium related to the acquired loans held for sale was $0.7 million. On August 1, 2018, the Company acquired loans and leases from the Crestmark acquisition totaling $1.06 billion and recorded related credit and interest rate mark discounts of $12.3 million and $6.0 million, respectively.

During the nine months ended June 30, 2019, the Company transferred $39.5 million of consumer credit product loans to held for sale and originated $104.1 million of SBA/USDA and consumer credit product loans as held for sale. The Company sold held for sale loans resulting in proceeds of $95.7 million and gains on sale of $3.7 million during the nine months ended June 30, 2019. During the nine months ended June 30, 2018, the Company did not designate any loans as held for sale or sell any held for sale loans.

Loans purchased and sold by portfolio segment, including participation interests, for the three and nine months ended June 30, 2019 and 2018 were as follows:

	Three Months Ended				Nine Months Ended
	June 30, 2019		June 30, 2018		June 30, 2019		June 30, 2018
Loans Purchased	(Dollars in Thousands)
Loans held for sale	$	6,703	$	—	$	12,643	$	—
Loans held for investment:
Total National Lending	72,737		—		198,328		72,751
Total Community Banking	2,710		6,183		21,223		22,418
Total purchases	82,150		6,183		232,194		95,169
Loans Sold
Loans held for sale	57,661		—		92,565		—
Loans held for investment:
Total Community Banking	2,212		10,379		13,069		19,961
Total sales	$	59,873	$	10,379	$	105,634	$	19,961

The net investment in direct financing and sales-type leases was comprised of the following as of June 30, 2019 and September 30, 2018.

	June 30, 2019			September 30, 2018
	(Dollars in Thousands)
Minimum lease payments receivable	$	388,291		$	301,835
Estimated residual value of leased equipment	12,128			12,406
Unamortized initial direct costs	5,173			1,806
Premium on acquired leases	3			26
Unearned income	(58,450		)	(48,949		)
Net investment in direct financing and sales-type leases	$	347,145		$	267,124

Future minimum lease payments receivable on noncancelable direct financing and sales-type leases were as follows as of June 30, 2019.

	As of June 30, 2019
	(Dollars in thousands)
Remaining in 2019	$	36,473
2020	129,577
2021	104,805
2022	67,262
2023	37,753
2024 and thereafter	12,421
Total	$	388,291

The Company did not record any contingent rental income from sales-type and direct financing leases in the nine months ended June 30, 2019.

13

Activity in the allowance for loan and lease losses and balances of loans and leases by portfolio segment for each of the three and nine months ended June 30, 2019 and 2018 was as follows:

Allowance for loan and lease losses:	Beginning balance		Provision (recovery) for loan and lease losses			Charge-offs			Recoveries		Ending balance
Three Months Ended June 30, 2019	(Dollars in Thousands)
National Lending
Asset based lending	$	3,499	$	2,685		$	(1,380	)	$	3	$	4,807
Factoring	1,761		2,747			(1,335		)	31		3,204
Lease financing	1,965		(13		)	(736		)	203		1,419
Insurance premium finance	919		201			(275		)	171		1,016
SBA/USDA	474		449			—			—		923
Other commercial finance	525		432			—			—		957
Commercial finance	9,143		6,501			(3,726		)	408		12,326
Consumer credit products	1,314		142			—			—		1,456
Other consumer finance	5,130		1,890			(1,398		)	28		5,650
Consumer finance	6,444		2,032			(1,398		)	28		7,106
Tax services	24,102		914			(9,627		)	36		15,425
Warehouse finance	185		65			—			—		250
Total National Lending	39,874		9,512			(14,751		)	472		35,107
Community Banking
Commercial real estate and operating	6,673		(249		)	—			—		6,424
Consumer one-to-four family real estate and other	958		(65		)	—			—		893
Agricultural real estate and operating	1,167		(86		)	—			—		1,081
Total Community Banking	8,798		(400		)	—			—		8,398
Total	$	48,672	$	9,112		$	(14,751	)	$	472	$	43,505

14

Allowance for loan and lease losses:	Beginning balance		Provision (recovery) for loan and lease losses			Charge-offs			Recoveries		Ending balance
Nine Months Ended June 30, 2019	(Dollars in Thousands)
National Lending
Asset based lending	$	107	$	6,213		$	(1,642	)	$	129	$	4,807
Factoring	64		5,769			(2,711		)	82		3,204
Lease financing	59		1,529			(2,198		)	2,029		1,419
Insurance premium finance	1,031		2,091			(2,359		)	253		1,016
SBA/USDA	13		910			—			—		923
Other commercial finance	28		929			—			—		957
Commercial finance	1,302		17,441			(8,910		)	2,493		12,326
Consumer credit products	785		671			—			—		1,456
Other consumer finance	2,820		8,249			(5,477		)	58		5,650
Consumer finance	3,605		8,920			(5,477		)	58		7,106
Tax services	—		24,883			(9,670		)	212		15,425
Warehouse finance	65		185			—			—		250
Total National Lending	4,972		51,429			(24,057		)	2,763		35,107
Community Banking
Commercial real estate and operating	6,220		204			—			—		6,424
Consumer one-to-four family real estate and other	632		281			(20		)	—		893
Agricultural real estate and operating	1,216		(385		)	—			250		1,081
Total Community Banking	8,068		100			(20		)	250		8,398
Total	$	13,040	$	51,529		$	(24,077	)	$	3,013	$	43,505

Allowance for loan and lease losses:	Beginning balance		Provision (recovery) for loan and lease losses			Charge-offs			Recoveries		Ending balance
Three Months Ended June 30, 2018	(Dollars in Thousands)
National Lending
Insurance premium finance	$	746	$	304		$	(243	)	$	99	$	906
Other commercial finance	4		8			—			—		12
Commercial finance	750		312			(243		)	99		918
Consumer credit products	—		264			—			—		264
Other consumer finance	—		3,000			—			—		3,000
Consumer finance	—		3,264			—			—		3,264
Tax services	19,573		1,189			(10,507		)	1		10,256
Total National Lending	20,323		4,765			(10,750		)	100		14,438
Community Banking
Commercial real estate and operating	4,100		687			—			—		4,787
Consumer one-to-four family real estate and other	901		(218		)	—			—		683
Agricultural real estate and operating	765		(51		)	—			207		921
Unallocated	989		132			—			—		1,121
Total Community Banking	6,755		550			—			207		7,512
Total	$	27,078	$	5,315		$	(10,750	)	$	307	$	21,950

15

Allowance for loan and lease losses:	Beginning balance		Provision (recovery) for loan and lease losses			Charge-offs			Recoveries		Ending balance
Nine Months Ended June 30, 2018	(Dollars in Thousands)
National Lending
Insurance premium finance	$	796	$	569		$	(711	)	$	252	$	906
Other commercial finance	4		8			—			—		12
Commercial finance	800		577			(711		)	252		918
Consumer credit products	—		264			—			—		264
Other consumer finance	—		3,000			—			—		3,000
Consumer finance	—		3,264			—			—		3,264
Tax services	5		20,335			(10,507		)	423		10,256
Total National Lending	805		24,176			(11,218		)	675		14,438
Community Banking
Commercial real estate and operating	2,820		1,967			—			—		4,787
Consumer one-to-four family real estate and other	809		(98		)	(31		)	3		683
Agricultural real estate and operating	2,574		(1,914		)	—			261		921
Unallocated	526		595			—			—		1,121
Total Community Banking	6,729		550			(31		)	264		7,512
Total	$	7,534	$	24,726		$	(11,249	)	$	939	$	21,950

The following tables provide details regarding the allowance for loan and lease losses and balance by type of allowance as of June 30, 2019 and September 30, 2018.

	Allowance						Loans and Leases
Recorded Investment	Ending balance: individually evaluated for impairment		Ending balance: collectively evaluated for impairment		Total		Ending balance: individually evaluated for impairment		Ending balance: collectively evaluated for impairment		Total
As of June 30, 2019	(Dollars in Thousands)
National Lending
Asset based lending	$	12	$	4,795	$	4,807	$	8,119	$	607,190	$	615,309
Factoring	255		2,949		3,204		7,795		312,549		320,344
Lease financing	—		1,419		1,419		5,455		336,502		341,957
Insurance premium finance	—		1,016		1,016		—		358,772		358,772
SBA/USDA	—		923		923		1,276		98,515		99,791
Other commercial finance	—		957		957		—		99,677		99,677
Commercial finance	267		12,059		12,326		22,645		1,813,205		1,835,850
Consumer credit products	—		1,456		1,456		—		155,539		155,539
Other consumer finance	—		5,650		5,650		1,039		163,688		164,727
Consumer finance	—		7,106		7,106		1,039		319,227		320,266
Tax services	—		15,425		15,425		—		24,410		24,410
Warehouse finance	—		250		250		—		250,003		250,003
Total National Lending	267		34,840		35,107		23,684		2,406,845		2,430,529
Community Banking
Commercial real estate and operating	—		6,424		6,424		319		877,093		877,412
Consumer one-to-four family real estate and other	—		893		893		290		256,563		256,853
Agricultural real estate and operating	—		1,081		1,081		1,237		59,932		61,169
Total Community Banking	—		8,398		8,398		1,846		1,193,588		1,195,434
Total	$	267	$	43,238	$	43,505	$	25,530	$	3,600,433	$	3,625,963

16

	Allowance						Loans and Leases
Recorded Investment	Ending balance: individually evaluated for impairment(1)		Ending balance: collectively evaluated for impairment(1)		Total		Ending balance: individually evaluated for impairment		Ending balance: collectively evaluated for impairment		Total
As of September 30, 2018	(Dollars in Thousands)
National Lending
Asset based lending	$	—	$	107	$	107	$	1,404	$	476,513	$	477,917
Factoring	—		64		64		3,331		280,890		284,221
Lease financing	—		59		59		8,877		256,438		265,315
Insurance premium finance	—		1,031		1,031		—		337,877		337,877
SBA/USDA	—		13		13		—		59,374		59,374
Other commercial finance	—		28		28		—		85,145		85,145
Commercial finance	—		1,302		1,302		13,612		1,496,237		1,509,849
Consumer credit products	—		785		785		—		80,605		80,605
Other consumer finance	—		2,820		2,820		—		189,756		189,756
Consumer finance	—		3,605		3,605		—		270,361		270,361
Tax services	—		—		—		—		1,073		1,073
Warehouse finance	—		65		65		—		65,000		65,000
Total National Lending	—		4,972		4,972		13,612		1,832,671		1,846,283
Community Banking
Commercial real estate and operating	—		6,220		6,220		451		790,439		790,890
Consumer one-to-four family real estate and other	—		632		632		94		247,224		247,318
Agricultural real estate and operating	—		1,216		1,216		1,454		59,044		60,498
Total Community Banking	—		8,068		8,068		1,999		1,096,707		1,098,706
Total	$	—	$	13,040	$	13,040	$	15,611	$	2,929,378	$	2,944,989

⁽¹⁾ Balances have been restated from what was previously reported as of September 30, 2018 on the Company's Annual Report on Form 10-K for its fiscal year ended September 30, 2018.

Federal regulations provide for the classification of loans and other assets such as debt and equity securities considered by the Bank's primary regulator, the Office of the Comptroller of the Currency (the “OCC”), to be of lesser quality as “substandard,” “doubtful” or “loss.”  The loan and lease classification and risk rating definitions are as follows:

Pass- A pass asset is of sufficient quality in terms of repayment, collateral and management to preclude a special mention or an adverse rating.

Watch- A watch asset is generally a credit performing well under current terms and conditions but with identifiable weakness meriting additional scrutiny and corrective measures.  Watch is not a regulatory classification but can be used to designate assets that are exhibiting one or more weaknesses that deserve management’s attention.  These assets are of better quality than special mention assets.

Special Mention- Special mention assets are a credit with potential weaknesses deserving management’s close attention and, if left uncorrected, may result in deterioration of the repayment prospects for the asset.  Special mention assets are not adversely classified and do not expose an institution to sufficient risk to warrant adverse classification.  Special mention is a temporary status with aggressive credit management required to garner adequate progress and move to watch or higher.

The adverse classifications are as follows:

Substandard- A substandard asset is inadequately protected by the net worth and/or repayment ability or by a weak collateral position.  Assets so classified will have well-defined weaknesses creating a distinct possibility the Bank will sustain some loss if the weaknesses are not corrected.  Loss potential does not have to exist for an asset to be classified as substandard.

17

Doubtful- A doubtful asset has weaknesses similar to those classified substandard, with the degree of weakness causing the likely loss of some principal in any reasonable collection effort.  Due to pending factors, the asset’s classification as loss is not yet appropriate.

Loss- A loss asset is considered uncollectible and of such little value that the asset’s continuance on the Bank’s balance sheet is no longer warranted.  This classification does not necessarily mean an asset has no recovery or salvage value leaving room for future collection efforts.

General allowances represent loss allowances which have been established to recognize the inherent risk associated with lending activities, but which, unlike specific allowances, have not been allocated to particular problem assets.  When assets are classified as “loss,” the Company is required either to establish a specific allowance for losses equal to 100% of that portion of the asset so classified or to charge-off such amount.  The Company's determinations as to the classification of its assets and the amount of its valuation allowances are subject to review by its regulatory authorities, which may order the establishment of additional general or specific loss allowances.

The Company recognizes that concentrations of credit may naturally occur and may take the form of a large volume of related loans and leases to an individual, a specific industry, or a geographic location.  Credit concentration is a direct, indirect, or contingent obligation that has a common bond where the aggregate exposure equals or exceeds a certain percentage of the Company’s Tier 1 Capital plus the Allowance for Loan and Lease Losses.

The asset classification of loans and leases at June 30, 2019 and September 30, 2018 were as follows:

Asset Classification	Pass		Watch		Special Mention		Substandard		Total
June 30, 2019	(Dollars in Thousands)
National Lending
Asset based lending	$	539,623	$	—	$	67,567	$	8,119	$	615,309
Factoring	272,589		—		39,960		7,795		320,344
Lease financing	323,539		—		12,963		5,455		341,957
Insurance premium finance	358,772		—		—		—		358,772
SBA/USDA	90,110		—		8,405		1,276		99,791
Other commercial finance	99,108		—		569		—		99,677
Commercial finance	1,683,741		—		129,464		22,645		1,835,850
Consumer credit products	155,539		—		—		—		155,539
Other consumer finance	164,727		—		—		—		164,727
Consumer finance	320,266		—		—		—		320,266
Tax services	24,410		—		—		—		24,410
Warehouse finance	250,003		—		—		—		250,003
Total National Lending	2,278,420		—		129,464		22,645		2,430,529
Community Banking
Commercial real estate and operating	866,255		3,962		3,487		3,708		877,412
Consumer one-to-four family real estate and other	254,959		1,403		462		29		256,853
Agricultural real estate and operating	42,808		4,148		5,615		8,598		61,169
Total Community Banking	1,164,022		9,513		9,564		12,335		1,195,434
Total loans and leases	$	3,442,442	$	9,513	$	139,028	$	34,980	$	3,625,963

18

Asset Classification	Pass		Watch		Special Mention		Substandard		Total
September 30, 2018	(Dollars in Thousands)
National Lending
Asset based lending	$	418,635	$	—	$	57,877	$	1,405	$	477,917
Factoring	248,246		—		32,644		3,331		284,221
Lease financing	252,487		—		3,951		8,877		265,315
Insurance premium finance	336,296		—		1,581		—		337,877
SBA/USDA	39,093		—		20,281		—		59,374
Other commercial finance	85,145		—		—		—		85,145
Commercial finance	1,379,902		—		116,334		13,613		1,509,849
Consumer credit products	80,605		—		—		—		80,605
Other consumer finance	189,756		—		—		—		189,756
Consumer finance	270,361		—		—		—		270,361
Tax services	1,073		—		—		—		1,073
Warehouse finance	65,000		—		—		—		65,000
Total National Lending	1,716,336		—		116,334		13,613		1,846,283
Community Banking
Commercial real estate and operating	778,445		12,251		194		—		790,890
Consumer one-to-four family real estate and other	246,463		537		239		79		247,318
Agricultural real estate and operating	42,292		2,447		4,872		10,887		60,498
Total Community Banking	1,067,200		15,235		5,305		10,966		1,098,706
Total loans and leases	$	2,783,536	$	15,235	$	121,639	$	24,579	$	2,944,989

National Lending (Commercial Finance, Consumer Finance, Tax Services and Warehouse Finance)

Commercial Finance

The Company's commercial finance product lines include asset-based lending, factoring, leasing, commercial insurance premium finance, and other commercial finance products offered on a nationwide basis. Asset-based lending and factoring primarily service small businesses that are startups, distressed and/or generally that may not otherwise qualify for traditional bank financing. Leasing focuses on providing equipment finance solutions to mid-market companies. These product offerings supplement the asset generation capacity in our community bank and tax services divisions and enhance the overall yield of our loan and lease portfolio, enabling us to earn attractive risk-adjusted net interest margins.

Asset-Based Lending. Through its Crestmark division, the Bank provides asset-based loans secured by short-term assets such as inventory, accounts receivable, and work-in-process. Asset-based loans may also be secured by real estate and equipment. The primary sources of repayment are the operating income of the borrower, the collection of the receivables securing the loan, and/or the sale of the inventory securing the loan. Loans are typically revolving lines of credit with terms of one to three years, whereby the Bank withholds a contingency reserve representing the difference between the amount advanced and the fair value of the invoice amount or other collateral value. Credit risk is managed through advance rates appropriate for the collateral, standardized loan policies, established and authorized credit limits, attentive portfolio management and the use of lock box agreements and similar arrangements that result in the Company receiving and controlling the debtors' cash receipts. The Bank also originates collateralized term loans and notes receivable, with terms ranging from three to 25 years.

Factoring. Through its Crestmark division, the Bank provides factoring lending where clients provide detailed inventory, accounts receivable, and work-in-process reports for lending arrangements. The factoring clients are diversified as to industry and geography. With these loans, the Crestmark division withholds a contingency reserve, which is the difference between the fair value of the invoice amount or other collateral value and the amount advanced. This reserve is withheld for nonpayment of factored receivables, service fees and other adjustments. Credit risk is managed through standardized advance policies, established and authorized credit limits, verification of receivables, attentive portfolio management and the use of lock box agreements and similar arrangements that result in the Company receiving and controlling the client's cash receipts. In addition, clients generally guarantee the payment of purchased accounts receivable.

19

Lease Financing. Through its Crestmark division, the Bank provides creative, flexible lease solutions for technology, capital equipment and select transportation assets like tractors and trailers. Direct financing leases and sales-type leases substantially transfer the benefits and risks of equipment ownership to the lessee.  The lease may contain provisions that transfer ownership to the lessee at the end of the initial term, contain a bargain purchase option or allow for purchase of the equipment at fair market value.  Residual values are estimated at the inception of the lease.  Lease maturities are generally no greater than 84 months. The focus in this lease financing category is to support middle market companies by providing a variety of financing products to help them meet their business objectives.

Insurance Premium Finance. Through its AFS/IBEX division the Bank provides, on a national basis, short-term, primarily collateralized financing to facilitate the commercial customers’ purchase of insurance for various forms of risk, otherwise known as insurance premium financing. This includes, but is not limited to, policies for commercial property, casualty and liability risk.  Premiums are advanced either directly to the insurance carrier or through an intermediary/broker and repaid by the policyholder with interest during the policy term.  The policyholder generally makes a 20% to 25% down payment to the insurance broker and finances the remainder over nine to 10 months on average.  The down payment is set such that if the policy is canceled, the unearned premium is typically sufficient to cover the loan balance and accrued interest. The AFS/IBEX division markets itself to the insurance community as a competitive option based on service, reputation, competitive terms, cost and ease of operation.

Small Business Administration ("SBA") and United States Department of Agriculture ("USDA"). The Bank originates loans through programs partially guaranteed by the SBA or USDA. These loans are made to small businesses and professionals with what the Bank believes are lower risk characteristics.

Other Commercial Finance. Included in this category of loans are the Company's healthcare receivables loan portfolio primarily comprised of loans to individuals for medical services received. The majority of these loans are guaranteed by the hospital providing the service to the debtor and this guarantee serves to reduce credit risk as the guarantors agree to repurchase severely delinquent loans. Credit risk is minimized on these loans based on the guarantor’s repurchase agreement. This loan category also includes commercial real estate loans to customers of the Crestmark division.

Consumer Finance

Consumer Credit Products. Through the acquisition of Specialty Consumer Services, the Bank acquired a platform that provides a total solution for marketplace lending, including underwriting and loan management in the direct-to-consumer credit business. The acquired platform allows the Bank to provide innovative lending solutions through consumer credit products. The Company designs and structures its credit programs in an effort to insulate the Company from program losses and to potentially increase the liquidity attributes of such lending programs' marketability to potential bank or other purchasers. While each program is different, all contain one or more types of credit enhancements, loss protections, or trigger events. When determining the applicable program enhancement, generally, the Company uses proprietary data provided by the Company’s partner, with respect to such program, supplemented with public data to design and shape appropriate loss curves, as well as implement stresses significantly higher than base to provide protection in changing credit cycles. Credit enhancements are typically built through holding excess program interest and fees in a reserve account to pay program credit losses. Cash flow waterfall positioning allows for losses and Company program principal and interest to be paid, under certain circumstances, before servicing or other program expenses. Trigger events allow programs and originations to be suspended if certain vintage loss limits, during a specific period of time, are triggered or if cumulative loss percentages are triggered. These triggers are designed to allow the Company to address potential issues quickly. Other trigger events in certain programs provide for excess credit or reserve enhancements, which could be beyond excess interest amounts, if certain loss triggers are breached. The Bank applies a reserve for loan losses of approximately 1% on outstanding loan balances within each of the consumer credit product programs.

Through June 30, 2019, the Bank has launched two consumer credit programs. During the second quarter of fiscal 2018, the Bank entered into a three years program agreement with Liberty Lending, LLC ("Liberty Lending") whereby the Bank provides personal loans to Liberty Lending customers. The Bank and Liberty Lending market the program jointly through a wide variety of marketing channels. The loan products under the agreement with Liberty Lending are closed-end installment loans ranging from $3,500 to $45,000 in initial principal amount with durations between 13 months and 60 months.

20

The Bank entered into an agreement for 3 years with Health Credit Services ("HCS") during the third quarter of fiscal 2018. The Bank approves and originates loans for elective medical procedures for select HCS provider offices throughout the United States. HCS works with its provider partners to market the loans, as well as provide servicing for them. The loan products offered are unsecured, closed-end installment loans with terms between 12 months and 84 months and revolving lines of credit with durations between six months and 60 months.

Other Consumer Finance. The Bank's purchased student loan portfolios are seasoned, floating rate, private portfolios that are serviced by a third-party servicer. The portfolio purchased during the first quarter of fiscal year 2018 is indexed to one-month LIBOR, while the portfolio purchased in the first quarter of fiscal year 2017 is indexed to three-month LIBOR plus various margins. The Company received written notification on June 18, 2018 from ReliaMax Surety Company ("ReliaMax"), the company that provided insurance coverage for the student loan portfolios, which informed policy holders that the South Dakota Division of Insurance filed a petition to have ReliaMax declared insolvent and to adopt a plan of liquidation. An Order of Liquidation was entered on June 27, 2018 by the Sixth Circuit Court in Hughes County, South Dakota, declaring ReliaMax insolvent and appointing the South Dakota Division of Insurance as liquidator to adopt a plan of liquidation. The Company expects to ultimately recover a portion of the unearned premiums, though the Company can provide no assurance as to the timing and amount of any such recovery.

Tax Services

The Bank's tax services division provides short-term taxpayer advance loans. Taxpayers are underwritten to determine eligibility for these unsecured loans. Due to the nature of taxpayer advance loans, it typically takes no more than three e-file cycles (the period of time between scheduled IRS payments) from when the return is accepted by the IRS to collect from the borrower. In the event of default, the Bank has no recourse against the tax consumer. The Bank will charge off the balance of a taxpayer advance loan if there is a balance at the end of the calendar year, or when collection of principal becomes doubtful.

Through its tax services division, the Bank provides short-term electronic return originator ("ERO") advance loans on a nationwide basis. These loans are typically utilized by tax preparers to purchase tax preparation software and to prepare tax office operations for the upcoming tax season. EROs go through an underwriting process to determine eligibility for the unsecured advances. ERO loans are not collateralized. Collection on ERO advances begins once the ERO begins to process refund transfers. Generally, the Bank will charge off the balance of an ERO advance loan if there is a balance at the end of June, or when collection of principal becomes doubtful.

Warehouse Finance

In fiscal 2018, the Bank entered into a first-out participation agreement in a consumer receivable asset-backed warehouse line of credit, with the Bank holding a senior collateral position enhanced by a subordinate party structure. During the first quarter of fiscal 2019, the Bank entered into two additional first-out participation agreements in asset-backed warehouse lines of credit, including consumer loan receivables and small business loan receivables. The senior collateral position of the Bank is supported by a subordinate party position. During the third quarter of fiscal 2019, the Bank entered into a first-out participation agreement in a consumer receivable asset-backed warehouse line of credit, with the Bank holding a senior collateral position enhanced by a subordinate party structure.

Community Banking

Commercial Real Estate and Operating. The Company engages in commercial and multi-family real estate lending in the community bank's primary market areas and surrounding areas. These loans are secured primarily by apartment buildings, office buildings, and hotels.  Commercial and multi-family real estate loans generally are underwritten with terms not exceeding 20 years, have loan-to-value ratios of up to 80% of the appraised value of the property securing the loan, and are typically secured by guarantees of the borrowers.  The Company has a variety of rate adjustment features and other terms in its commercial and multi-family real estate loan portfolio.  Commercial and multi-family real estate loans provide for a margin over a number of different indices.  In underwriting these loans, the Company analyzes the financial condition of the borrower, the borrower’s credit history, and the reliability and predictability of the cash flow generated by the property securing the loan.  Appraisals on properties securing commercial real estate loans originated by the Company are performed by independent appraisers.

The repayment of loans secured by commercial and multi-family real estate is typically dependent upon the successful operation of the related real estate project.  If the cash flow from the project is reduced (for example, if leases are not obtained or renewed, or a bankruptcy court modifies a lease term, or a major tenant is unable to fulfill its lease obligations), the borrower’s ability to repay the loan may be impaired.

21

The Company originates its community banking commercial operating loans primarily in the community bank's market areas.  Most of these commercial operating loans have been extended to finance local and regional businesses and include short-term loans to finance machinery and equipment purchases, inventory and accounts receivable.  Commercial loans also may involve the extension of revolving credit for a combination of equipment acquisitions and working capital in expanding companies. The maximum term for loans extended on machinery and equipment is based on the projected useful life of such machinery and equipment.  Generally, the maximum term on non-mortgage lines of credit is one year. 

The Company’s commercial operating lending policy includes credit file documentation and analysis of the borrower’s management ability, capacity to repay the loan, the adequacy of the borrower’s capital and collateral as well as an evaluation of conditions affecting the borrower.  Analysis of the borrower’s past, present and future cash flows is also an important aspect of the Company’s current credit analysis. Commercial operating loans typically are made on the basis of the borrower’s ability to make repayment from the cash flow of the borrower’s business.  As a result, the availability of funds for the repayment of commercial operating loans may be substantially dependent on the success of the business itself (which, in turn, is likely to be dependent upon the general economic environment).  The Company’s commercial operating loans are usually secured by business assets and personal guarantees.  However, the collateral securing the loans may depreciate over time, may be difficult to appraise and may fluctuate in value based on the success of the business.

Consumer One-to-Four Family Real Estate and Other. One-to-four family real estate loan originations are typically generated by the Company’s marketing efforts, its present customers, walk-in customers and referrals. The Company offers fixed-rate loans and adjustable-rate mortgage ("ARM") loans for both permanent structures and those under construction. The Company’s one-to-four family real estate loan originations are secured primarily by properties located in the community bank's primary market areas and surrounding areas.

The Company originates one-to-four family real estate loans with terms up to a maximum of 30 years and with loan-to-value ratios up to 100% of the lesser of the appraised value of the property securing the loan or the contract price. However, the vast majority of these loans are originated with loan-to-value ratios below 80%. The Company generally requires that private mortgage insurance be obtained in an amount sufficient to reduce the Company’s exposure to at or below the 80% loan‑to‑value level. Due to consumer demand, the Company also offers fixed-rate mortgage loans with terms up to 30 years, which may conform to secondary market standards such as those imposed by Fannie Mae, Ginnie Mae, and Freddie Mac. The Company typically holds all fixed-rate mortgage loans and does not engage in secondary market sales. The Company also offers ARM loans with terms up to five years and ten years.

In underwriting one-to-four family real estate loans, the Company evaluates both the borrower’s ability to make monthly payments and the value of the property securing the loan.  Properties securing real estate loans made by the Company are appraised by independent appraisers approved by the Board of Directors of the Company.  The Company generally requires borrowers to obtain an attorney’s title opinion or title insurance, as well as fire and property insurance (including flood insurance, if necessary) in an amount not less than the amount of the loan.  Real estate loans originated by the Company generally contain a “due on sale” clause that allows the Company to declare the unpaid principal balance due and payable upon the sale of the security property.  The Company has not engaged in sub-prime residential mortgage originations.

The Company originates a variety of secured consumer loans, including home equity, home improvement, automobile and boat loans, as well as loans secured by savings deposits in its primary market areas and surrounding areas. Substantially all of the Company’s home equity loans and lines of credit are secured by second mortgages on principal residences.  The Bank will lend amounts that, together with all prior liens, may be up to 90% of the appraised value of the property securing the loan.  Home equity loans and lines of credit generally have maximum terms of five years.

Consumer loan terms vary according to the type and value of collateral, length of contract and creditworthiness of the borrower.  The underwriting standards employed by the Bank for consumer loans include an application, a determination of the applicant’s payment history on other debts and an assessment of ability to meet existing obligations and payments on the proposed loan.  Although creditworthiness of the applicant is a primary consideration, the underwriting process also may include a comparison of the value of the security, if any, in relation to the proposed loan amount.

22

Agricultural Real Estate and Operating. The Company originates loans to finance the purchase of farmland, livestock, farm machinery and equipment, seed, fertilizer, and other farm-related products, primarily in its market areas. Agricultural operating loans are originated at either an adjustable- or fixed-rate of interest for up to a 1 year term or, in the case of livestock, are due upon sale. Agricultural real estate loans are frequently originated with adjustable rates of interest.  Generally, such loans provide for a fixed rate of interest for the first 5 years to 10 years, after which the loan will balloon or the interest rate will adjust annually. These loans generally amortize over a period of 20 to 25 years. Fixed-rate agricultural real estate loans typically have terms up to 10 years. Agricultural real estate loans are generally limited to 75% of the value of the property securing the loan.

Payments on loans are dependent on the successful operation or management of the farm property securing the loan or for which an operating loan is utilized. The success of the loan may also be affected by many factors outside the control of the borrower such as weather, government support programs and grain and livestock prices. These risks may be reduced, by the farmer, with the use of crop insurance coverage and futures contracts or options to mitigate price risk, both of which the Company frequently requires of the borrowers to help ensure loan repayment. Many farms are also dependent on a limited number of key individuals whose injury or death may result in an inability to successfully operate the farm.

Past due loans and leases at June 30, 2019 and September 30, 2018 were as follows:

	Accruing and Non-accruing Loans and Leases												Non-performing Loans and Leases
Past Due Loans and Leases	30-59 Days Past Due		60-89 Days Past Due		> 89 Days Past Due		Total Past Due		Current		Total Loans and Leases Receivable		> 89 Days Past Due and Accruing		Non-accrual balance		Total
June 30, 2019	(Dollars in Thousands)
National Lending
Asset based lending	$	1,701	$	428	$	2,890	$	5,019	$	610,290	$	615,309	$	180	$	5,654	$	5,834
Factoring	—		—		20		20		320,324		320,344		—		4,846		4,846
Lease financing	2,080		1,816		5,408		9,304		332,653		341,957		4,225		1,936		6,161
Insurance premium finance	2,233		1,081		1,679		4,993		353,779		358,772		1,679		—		1,679
SBA/USDA	85		—		259		344		99,447		99,791		—		259		259
Other commercial finance	—		—		—		—		99,677		99,677		—		—		—
Commercial finance	6,099		3,325		10,256		19,680		1,816,170		1,835,850		6,084		12,695		18,779
Consumer credit products	1,454		1,039		703		3,196		152,343		155,539		703		—		703
Other consumer finance	996		614		1,083		2,693		162,034		164,727		1,083		—		1,083
Consumer finance	2,450		1,653		1,786		5,889		314,377		320,266		1,786		—		1,786
Tax services	—		24,410		—		24,410		—		24,410		—		—		—
Warehouse finance	—		—		—		—		250,003		250,003		—		—		—
Total National Lending	8,549		29,388		12,042		49,979		2,380,550		2,430,529		7,870		12,695		20,565
Community Banking
Commercial real estate and operating	—		—		—		—		877,412		877,412		—		—		—
Consumer one-to-four family real estate and other	54		36		233		323		256,530		256,853		—		233		233
Agricultural real estate and operating	1,745		—		—		1,745		59,424		61,169		—		—		—
Total Community Banking	1,799		36		233		2,068		1,193,366		1,195,434		—		233		233
Total Loans and Leases	$	10,348	$	29,424	$	12,275	$	52,047	$	3,573,916	$	3,625,963	$	7,870	$	12,928	$	20,798

23

	Accruing and Non-accruing Loans and Leases												Non-performing Loans and Leases
Past Due Loans and Leases	30-59 Days Past Due		60-89 Days Past Due		> 89 Days Past Due		Total Past Due		Current		Total Loans and Leases Receivable		> 89 Days Past Due and Accruing		Non-accrual balance		Total
September 30, 2018	(Dollars in Thousands)
National Lending
Asset based lending	$	1,235	$	2,151	$	94	$	3,480	$	474,437	$	477,917	$	94	$	—	$	94
Factoring	—		—		—		—		284,221		284,221		—		—		—
Lease financing	16,542		532		2,921		19,995		245,320		265,315		726		2,864		3,590
Insurance premium finance	1,864		1,019		2,981		5,864		332,013		337,877		2,981		—		2,981
SBA/USDA	1,067		—		—		1,067		58,307		59,374		—		—		—
Other commercial finance	—		—		—		—		85,145		85,145		—		—		—
Commercial finance	20,708		3,702		5,996		30,406		1,479,443		1,509,849		3,801		2,864		6,665
Consumer credit products	532		284		147		963		79,642		80,605		147		—		147
Other consumer finance	2,677		1,311		2,237		6,225		183,531		189,756		2,237		—		2,237
Consumer finance	3,209		1,595		2,384		7,188		263,173		270,361		2,384		—		2,384
Tax services	—		—		1,073		1,073		—		1,073		1,073		—		1,073
Warehouse finance	—		—		—		—		65,000		65,000		—		—		—
Total National Lending	23,917		5,297		9,453		38,667		1,807,616		1,846,283		7,258		2,864		10,122
Community Banking
Commercial real estate and operating	—		—		—		—		790,890		790,890		—		—		—
Consumer one-to-four family real estate and other	105		—		79		184		247,134		247,318		79		—		79
Agricultural real estate and operating	—		—		—		—		60,498		60,498		—		—		—
Total Community Banking	105		—		79		184		1,098,522		1,098,706		79		—		79
Total Loans and Leases	$	24,022	$	5,297	$	9,532	$	38,851	$	2,906,138	$	2,944,989	$	7,337	$	2,864	$	10,201

Certain loans and leases 89 days or more past due as to interest or principal continue to accrue because they are (1) well-secured and in the process of collection or (2) one-to-four family real estate loans or consumer loans exempt under regulatory rules from being classified as non-accrual until later delinquency, usually 120 days past due.

When analysis of borrower or lessee operating results and financial condition indicates that underlying cash flows of the borrower’s business are not adequate to meet its debt service requirements, the loan or lease is evaluated for impairment.  Often, this is associated with a delay or shortfall in scheduled payments, as described above.

24

Impaired loans and leases at June 30, 2019 and September 30, 2018 were as follows:

June 30, 2019	Recorded Balance		Unpaid Principal Balance		Specific Allowance
Loans and leases without a specific valuation allowance	(Dollars in Thousands)
National Lending
Asset based lending	$	8,024	$	9,362	$	—
Factoring	3,580		4,655		—
Lease financing	5,455		5,455		—
SBA/USDA	1,276		1,276		—
Commercial finance	18,335		20,748		—
Other consumer finance	1,039		1,089		—
Consumer finance	1,039		1,089		—
Total National Lending	19,374		21,837		—
Community Banking
Commercial real estate and operating	319		319		—
Consumer one-to-four family real estate and other	290		290		—
Agricultural real estate and operating	1,237		1,237		—
Total Community Banking	1,846		1,846		—
Total	$	21,220	$	23,683	$	—
Loans and leases with a specific valuation allowance
National Lending
Asset based lending	$	95	$	107	$	12
Factoring	4,215		5,555		255
Commercial finance	4,310		5,662		267
Total National Lending	4,310		5,662		267
Total	$	4,310	$	5,662	$	267

September 30, 2018	Recorded Balance		Unpaid Principal Balance		Specific Allowance
Loans and leases without a specific valuation allowance	(Dollars in Thousands)
National Lending
Asset based lending	$	1,325	$	1,325	$	—
Factoring	1,383		1,713		—
Lease financing	5,491		5,491		—
Commercial finance	8,199		8,529		—
Total National Lending	8,199		8,529		—
Community Banking
Commercial real estate and operating	405		405		—
Consumer one-to-four family real estate and other	140		140		—
Agricultural real estate and operating	1,454		1,454		—
Total Community Banking	1,999		1,999		—
Total	$	10,198	$	10,528	$	—
Loans and leases with a specific valuation allowance
National Lending
Asset based lending	$	79	$	79	$	22
Factoring	1,948		2,198		49
Lease financing	3,386		3,386		517
Commercial finance	5,413		5,663		588
Total National Lending	5,413		5,663		588
Total	$	5,413	$	5,663	$	588

25

The following table provides the average recorded investment in impaired loans and leases for the three- and nine-month periods ended June 30, 2019 and 2018.

Three Months Ended June 30,	2019				2018
	Average Recorded Investment		Recognized Interest Income		Average Recorded Investment		Recognized Interest Income
	(Dollars in Thousands)
National Lending
Asset based lending	$	6,683	$	88	$	—	$	—
Factoring	6,621		—		—		—
Lease financing	3,351		—		—		—
SBA/USDA	425		—		—		—
Commercial finance	17,080		88		—		—
Other consumer finance	1,190		28		—		—
Consumer finance	1,190		28		—		—
Total National Lending	18,270		116		—		—
Community Banking
Commercial real estate and operating	106		5		604		4
Consumer one-to-four family real estate and other	186		1		342		2
Agricultural real estate and operating	1,226		28		2,670		42
Total Community Banking	1,518		34		3,616		48
Total loans and leases	$	19,788	$	150	$	3,616	$	48

Nine Months Ended June 30,	2019				2018
	Average Recorded Investment		Recognized Interest Income		Average Recorded Investment		Recognized Interest Income
	(Dollars in Thousands)
National Lending
Asset based lending	$	3,993	$	262	$	—	$	—
Factoring	4,178		5		—		—
Lease financing	5,012		17		—		—
SBA/USDA	142		—		—		—
Commercial finance	13,325		284		—		—
Other consumer finance	1,215		38		—		—
Consumer finance	1,215		38		—		—
Total National Lending	14,540		322		—		—
Community Banking
Commercial real estate and operating	259		9		761		14
Consumer one-to-four family real estate and other	154		3		224		11
Agricultural real estate and operating	1,371		63		1,567		106
Total Community Banking	1,784		75		2,552		131
Total loans and leases	$	16,324	$	397	$	2,552	$	131

The Company’s troubled debt restructurings ("TDRs") typically involve forgiving a portion of interest or principal on existing loans, making loans at a rate materially less than current market rates, or extending the term of the loan. There were $0.7 million of Community Banking loans and $0.1 million of National Lending loans that were modified in a TDR during the three months ended June 30, 2019, all of which were modified to extend the term of the loan. No loans and leases were modified in a TDR during the three months ended June 30, 2018.

26

There were $1.7 million of National Lending loans and leases and $0.7 million of Community Banking loans that were modified in a TDR during the nine months ended June 30, 2019, all of which were modified to extend the term of the loan. There were $3.8 million of Community Banking loans that were modified in a TDR during the nine months ended June 30, 2018. During the nine months ended June 30, 2019, the Company had $0.9 million of Community Banking loans that were modified in a TDR within the previous 12 months and for which there was a payment default. During the nine months ended June 30, 2018, the Company had $0.1 million of Community Banking loans that were modified in a TDR within the previous 12 months and for which there was a payment default.

At June 30, 2019, foreclosed and repossessed assets totaled $29.5 million, compared to $31.6 million at September 30, 2018. At June 30, 2019, the Company had established a valuation allowance of $0.1 million for repossessed assets. The Company did not have a valuation allowance established for any foreclosed and repossessed assets at September 30, 2018. There were no impairments on any foreclosed and repossessed assets at either date. The Company had $0.2 million of Community Banking loans in the process of foreclosure at June 30, 2019 and none at September 30, 2018.

NOTE 5. EARNINGS PER COMMON SHARE

Earnings per common share is computed after deducting any preferred dividends, if applicable. The Company has granted restricted share awards with dividend rights that are considered to be participating securities. Accordingly, a portion of the Company’s earnings is allocated to those participating securities in the earnings per share calculation. Basic earnings per common share is computed by dividing income available to common stockholders after the allocation of dividends and undistributed earnings to the participating securities by the weighted average number of common shares outstanding for the period. Diluted earnings per common share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised, and is computed after giving consideration to the weighted average dilutive effect of the Company’s stock options and after the allocation of earnings to the participating securities. Antidilutive options are disregarded in earnings per share calculations. The share and per share amounts for fiscal year 2018 have been restated to reflect the 3-for-1 forward stock split of the Company's common stock that was effected by the Company on October 4, 2018.

27

A reconciliation of net income and common stock share amounts used in the computation of basic and diluted earnings per share for the three and nine months ended June 30, 2019 and 2018 is presented below.

Three Months Ended June 30,	2019		2018
(Dollars in Thousands, Except Share and Per Share Data)
Basic income per common share:
Net income attributable to Meta Financial Group, Inc.	$	29,291	$	6,792
Weighted average common shares outstanding	38,903,266		29,099,472
Basic income per common share	0.75		0.23
Diluted income per common share:
Net income attributable to Meta Financial Group, Inc.	$	29,291	$	6,792
Weighted average common shares outstanding	38,903,266		29,099,472
Outstanding options - based upon the two-class method	74,424		119,508
Weighted average diluted common shares outstanding	38,977,690		29,218,980
Diluted income per common share	0.75		0.23

Nine Months Ended June 30,	2019		2018
(Dollars in Thousands, Except Share and Per Share Data)
Basic income per common share:
Net income attributable to Meta Financial Group, Inc.	$	76,809	$	42,898
Weighted average common shares outstanding	39,220,793		29,043,309
Basic income per common share	1.96		1.48
Diluted income per common share:
Net income attributable to Meta Financial Group, Inc.	$	76,809	$	42,898
Weighted average common shares outstanding	39,220,793		29,043,309
Outstanding options - based upon the two-class method	68,218		116,676
Weighted average diluted common shares outstanding	39,289,011		29,159,985
Diluted income per common share	1.95		1.47

NOTE 6. SECURITIES

On October 1, 2018, the Company adopted ASU 2016-01 on a prospective basis, which redefined the definition of equity securities and required their segregation from available for sale debt securities. While changes in the fair value of debt securities continue to be recorded in the equity category of accumulated other comprehensive income, the new guidance requires that changes in fair value of equity securities with readily determinable fair value be recorded in current earnings. As required by the new guidance, the unrealized gain in fair value on equity securities with readily determinable fair value (recorded in accumulated other comprehensive income at September 30, 2018) was reclassified to retained earnings on October 1, 2018. The amount of the reclassification was $0.5 million, net of tax. Equity securities with readily determinable fair value include mutual funds of $1.8 million at cost and $1.9 million at fair value at June 30, 2019.

28

The amortized cost, gross unrealized gains and losses and estimated fair values of available for sale ("AFS") and held to maturity ("HTM") debt securities at June 30, 2019 and September 30, 2018 are presented below.

At June 30, 2019	AMORTIZED COST		GROSS UNREALIZED GAINS		GROSS UNREALIZED (LOSSES)			FAIR VALUE
	(Dollars in Thousands)
Debt securities AFS
SBA securities	$	189,816	$	3,271	$	(21	)	$	193,066
Obligations of states and political subdivisions	858		17		—			875
Non-bank qualified obligations of states and political subdivisions	459,551		3,456		(2,347		)	460,660
Asset-backed securities	308,711		753		(2,168		)	307,296
Mortgage-backed securities	395,059		2,838		(2,696		)	395,201
Total debt securities AFS	$	1,353,995	$	10,335	$	(7,232	)	$	1,357,098
Common equities and mutual funds(1)(2)	$	3,593	$	826	$	—		$	4,419

⁽¹⁾ Equity securities at fair value are included within other assets on the consolidated statement of financial condition at June 30, 2019 and September 30, 2018.

⁽²⁾ ASU 2016-01 adopted on October 1, 2018, on a prospective basis, removed equity securities from AFS category at June 30, 2019.

At September 30, 2018	AMORTIZED COST		GROSS UNREALIZED GAINS		GROSS UNREALIZED (LOSSES)			FAIR VALUE
	(Dollars in Thousands)
Debt securities AFS
SBA securities	$	45,591	$	1	$	(1,255	)	$	44,337
Obligations of states and political subdivisions	17,154		49		(293		)	16,910
Non-bank qualified obligations of states and political subdivisions	1,140,884		826		(31,825		)	1,109,885
Asset-backed securities	310,700		2,585		(257		)	313,028
Mortgage-backed securities	378,301		—		(14,236		)	364,065
Total debt securities AFS	$	1,892,630	$	3,461	$	(47,866	)	$	1,848,225
Common equities and mutual funds(1)	3,172		635		(7		)	3,800
Total AFS securities(1)	$	1,895,802	$	4,096	$	(47,873	)	$	1,852,025

⁽¹⁾ Equity securities at fair value are included within other assets on the consolidated statement of financial condition at June 30, 2019 and September 30, 2018.

At June 30, 2019	AMORTIZED COST		GROSS UNREALIZED GAINS		GROSS UNREALIZED (LOSSES)			FAIR VALUE
	(Dollars in Thousands)
Debt securities HTM
Non-bank qualified obligations of states and political subdivisions	$	138,128	$	15	$	(2,500	)	$	135,643
Mortgage-backed securities	7,414		—		(119		)	7,295
Total held to maturity securities	$	145,542	$	15	$	(2,619	)	$	142,938

29

At September 30, 2018	AMORTIZED COST		GROSS UNREALIZED GAINS		GROSS UNREALIZED (LOSSES)			FAIR VALUE
	(Dollars in Thousands)
Debt securities HTM
Non-bank qualified obligations of states and political subdivisions	$	163,893	$	—	$	(10,758	)	$	153,135
Mortgage-backed securities	7,850		—		(422		)	7,428
Total held to maturity securities	$	171,743	$	—	$	(11,180	)	$	160,563

Management has implemented a process to identify securities with potential credit impairment that are other-than-temporary.  This process involves evaluation of the length of time and extent to which the fair value has been less than the amortized cost basis, review of available information regarding the financial position of the issuer, monitoring the rating, watch, and outlook of the security, monitoring changes in value, cash flow projections, and the Company’s intent to sell a security or whether it is more likely than not the Company will be required to sell the security before the recovery of its amortized cost which, in some cases, may extend to maturity.  To the extent the Company determines that a security is deemed to be other-than-temporarily impaired, an impairment loss is recognized.

For all securities considered temporarily impaired, the Company does not intend to sell these securities, and it is not more likely than not that the Company will be required to sell the security before recovery of its amortized cost, which may occur at maturity.  The Company believes it will collect all principal and interest due on all investments with amortized cost in excess of fair value and considered only temporarily impaired.

GAAP requires that, at acquisition, an enterprise classify debt securities into one of three categories: AFS, HTM or trading. AFS securities are carried at fair value on the consolidated statements of financial condition, and unrealized holding gains and losses are excluded from earnings and recognized as a separate component of equity in accumulated other comprehensive income (“AOCI”). HTM debt securities are measured at amortized cost. Both AFS and HTM are subject to review for other-than-temporary impairment. The Company had no trading securities at June 30, 2019 or September 30, 2018.

Gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at June 30, 2019 and September 30, 2018, were as follows:

	LESS THAN 12 MONTHS					OVER 12 MONTHS					TOTAL
At June 30, 2019	Fair Value		Unrealized (Losses)			Fair Value		Unrealized (Losses)			Fair Value		Unrealized (Losses)
	(Dollars in Thousands)
Debt securities AFS
SBA securities	$	13,785	$	(21	)	$	—	$	—		$	13,785	$	(21	)
Obligations of states and political subdivisions	—		—			—		—			—		—
Non-bank qualified obligations of states and political subdivisions	—		—			230,117		(2,347		)	230,117		(2,347		)
Asset-backed securities	134,246		(1,230		)	62,450		(938		)	196,696		(2,168		)
Mortgage-backed securities	—		—			172,718		(2,696		)	172,718		(2,696		)
Total debt securities AFS	$	148,031	$	(1,251	)	$	465,285	$	(5,981	)	$	613,316	$	(7,232	)
Common equities and mutual funds(1)(2)	—		—			—		—			—		—

⁽¹⁾ Equity securities at fair value are included within other assets on the consolidated statement of financial condition at June 30, 2019 and September 30, 2018.

⁽²⁾ ASU 2016-01 adopted on October 1, 2018, on a prospective basis, removed equity securities from AFS category at June 30, 2019.

30

	LESS THAN 12 MONTHS					OVER 12 MONTHS					TOTAL
At September 30, 2018	Fair Value		Unrealized (Losses)			Fair Value		Unrealized (Losses)			Fair Value		Unrealized (Losses)
	(Dollars in Thousands)
Debt securities AFS
SBA securities	$	43,097	$	(1,255	)	$	—	$	—		$	43,097	$	(1,255	)
Obligations of state and political subdivisions	11,036		(279		)	881		(14		)	11,917		(293		)
Non-bank qualified obligations of states and political subdivisions	626,693		(13,539		)	358,095		(18,286		)	984,788		(31,825		)
Asset-backed securities	146,638		(257		)	—		—			146,638		(257		)
Mortgage-backed securities	121,217		(3,292		)	242,849		(10,944		)	364,066		(14,236		)
Total debt securities AFS	$	948,681	$	(18,622	)	$	601,825	$	(29,244	)	$	1,550,506	$	(47,866	)
Common equities and mutual funds(1)	1,818		(7		)	—		—			1,818		(7		)
Total debt AFS securities(1)	$	950,499	$	(18,629	)	$	601,825	$	(29,244	)	$	1,552,324	$	(47,873	)

⁽¹⁾Equity securities at fair value are included within other assets on the consolidated statement of financial condition at June 30, 2019 and September 30, 2018.

	LESS THAN 12 MONTHS				OVER 12 MONTHS					TOTAL
At June 30, 2019	Fair Value		Unrealized (Losses)		Fair Value		Unrealized (Losses)			Fair Value		Unrealized (Losses)
	(Dollars in Thousands)
Debt securities HTM
Non-bank qualified obligations of states and political subdivisions	$	—	$	—	$	129,424	$	(2,500	)	$	129,424	$	(2,500	)
Mortgage-backed securities	—		—		7,295		(119		)	7,295		(119		)
Total held to maturity securities	$	—	$	—	$	136,719	$	(2,619	)	$	136,719	$	(2,619	)

	LESS THAN 12 MONTHS					OVER 12 MONTHS					TOTAL
At September 30, 2018	Fair Value		Unrealized (Losses)			Fair Value		Unrealized (Losses)			Fair Value		Unrealized (Losses)
	(Dollars in Thousands)
Debt securities HTM
Non-bank qualified obligations of states and political subdivisions	$	5,767	$	(287	)	$	147,368	$	(10,471	)	$	153,135	$	(10,758	)
Mortgage-backed securities	—		—			7,428		(422		)	7,428		(422		)
Total held to maturity securities	$	5,767	$	(287	)	$	154,796	$	(10,893	)	$	160,563	$	(11,180	)

At June 30, 2019, the investment portfolio included securities with current unrealized losses that have existed for longer than one year.  All of these securities are considered to be acceptable credit risks. Because (i) the declines in fair value were due to changes in market interest rates, not in estimated cash flows, (ii) the Company does not intend or has not made a decision to sell these securities and (iii) it is not more likely than not that the Company will be required to sell the securities before recovery of their amortized cost basis, which may occur at maturity, no other-than-temporary impairment was recorded at June 30, 2019.

31

The amortized cost and fair value of debt securities by contractual maturity as of the dates set forth below are shown below.  Certain securities have call features which allow the issuer to call the security prior to maturity.  Expected maturities may differ from contractual maturities in mortgage-backed securities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.  Therefore, mortgage-backed securities are not included in the maturity categories in the following maturity summary.  The expected maturities of certain housing related municipal securities, SBA and asset-backed securities may differ from contractual maturities because the borrowers may have the right to prepay the obligation. However, certain prepayment penalties may apply.

AFS Securities at Fair Value	AMORTIZED COST		FAIR VALUE
At June 30, 2019	(Dollars in Thousands)
Due in one year or less	$	—	$	—
Due after one year through five years	11,336		11,711
Due after five years through ten years	62,337		64,221
Due after ten years	885,263		885,965
	958,936		961,897
Mortgage-backed securities	395,059		395,201
Total securities at fair value	$	1,353,995	$	1,357,098

	AMORTIZED COST		FAIR VALUE
At September 30, 2018	(Dollars in Thousands)
Due in one year or less	$	2,532	$	2,529
Due after one year through five years	41,415		41,504
Due after five years through ten years	352,099		350,143
Due after ten years	1,118,283		1,089,984
	1,514,329		1,484,160
Mortgage-backed securities	378,301		364,065
Common equities and mutual funds(1)	3,172		3,800
Total securities at fair value	$	1,895,802	$	1,852,025

⁽¹⁾Equity securities at fair value are included within other assets on the consolidated statement of financial condition at June 30, 2019 and September 30, 2018.

HTM Securities at Fair Value	AMORTIZED COST		FAIR VALUE
At June 30, 2019	(Dollars in Thousands)
Due after ten years	$	138,128	$	135,643
	138,128		135,643
Mortgage-backed securities	7,414		7,295
Total held to maturity securities at cost	$	145,542	$	142,938

32

	AMORTIZED COST		FAIR VALUE
At September 30, 2018	(Dollars in Thousands)
Due after ten years	$	163,893	$	153,135
	163,893		153,135
Mortgage-backed securities	7,850		7,428
Total held to maturity securities at cost	$	171,743	$	160,563

Other investments, at cost, which are included in other assets on the consolidated statement of financial condition, include equity securities without a readily determinable fair value and shares of stock in the Federal Home Loan Bank ("FHLB") of Des Moines. Equity securities without a readily determinable fair value totaled $2.5 million at June 30, 2019 and $2.0 million at September 30, 2018. FHLB of Des Moines stock at June 30, 2019 and September 30, 2018 totaled $17.2 million and $23.4 million, respectively. The decrease in FHLB stock directly correlates with lower short-term borrowings balances at June 30, 2019 compared to September 30, 2018. The Company’s wholly-owned subsidiary, MetaBank, is required by federal law to maintain FHLB stock as a member of FHLB of Des Moines. These equity securities are ‘restricted’ in that they can only be sold back to the respective institution from which they were acquired or another member institution at par. Therefore, FHLB stock is less liquid than other marketable equity securities, and the fair value approximates cost. The Company evaluates impairment for investments held at cost on at least an annual basis based on the ultimate recoverability of the par value. No impairment was recognized for such investments for the nine months ended June 30, 2019.

NOTE 7. RENTAL EQUIPMENT, NET

Rental equipment was as follows as of June 30, 2019 and September 30, 2018.

	June 30, 2019			September 30, 2018
	(Dollars in thousands)
Computers and IT networking equipment	$	38,360		$	53,035
Motor vehicles and other	56,359			43,505
Office furniture and equipment	3,233			3,590
Solar panels and equipment	140,532			57,242
Total	238,484			157,372
Accumulated depreciation	(53,752		)	(50,082		)
Net book value	$	184,732		$	107,290

During the second quarter of fiscal year 2019, an impairment was recorded related to solar panels and equipment. Please refer to Note 3 for further discussion.

Future minimum lease payments receivable on equipment under operating leases was as follows as of June 30, 2019.

	June 30, 2019
	(Dollars in thousands)
Remaining in 2019	$	7,829
2020	26,938
2021	22,527
2022	15,911
2023	13,516
2024 and thereafter	28,309
Total	$	115,030

33

NOTE 8. GOODWILL AND INTANGIBLE ASSETS

The Company held a total of $307.9 million of goodwill as of June 30, 2019. The recorded goodwill is a result of multiple business combinations that have occurred since fiscal year 2015, the most recent being the merger with Crestmark pursuant to the Crestmark acquisition that closed on August 1, 2018. Goodwill is assessed for impairment at a reporting unit level, which is one level below the operating segments.

The changes in the carrying amount of the Company’s goodwill and intangible assets for the nine months ended June 30, 2019 and 2018 were as follows:

	Payments		Banking		Corporate Services/Other		Total
Goodwill	(Dollars in Thousands)
September 30, 2018	$	87,145	$	216,125	$	—	$	303,270
Acquisitions	—		—		—		—
Measurement Period Adjustments (1)	—		4,671		—		4,671
Impairment	—		—		—		—
June 30, 2019	$	87,145	$	220,796	$	—	$	307,941
September 30, 2017	$	87,145	$	11,578	$	—	$	98,723
Acquisitions	—		—		—		—
Impairment	—		—		—		—
June 30, 2018	$	87,145	$	11,578	$	—	$	98,723

⁽¹⁾ The Company recognized measurement period adjustments on provisional goodwill during the second and third fiscal quarters of 2019 related to the Crestmark acquisition. Refer to Note 3. Acquisitions.

	Trademark(1)			Non-Compete(2)			Customer Relationships(3)			All Others(4)			Total
Intangibles	(Dollars in Thousands)
Balance as of September 30, 2018	$	12,987		$	1,297		$	48,455		$	7,980		$	70,719
Acquisitions during the period	—			—			—			100			100
Amortization during the period	(771		)	(353		)	(12,504		)	(724		)	(14,352		)
Write-offs during the period	—			—			—			(314		)	(314		)
Balance as of June 30, 2019	$	12,216		$	944		$	35,951		$	7,042		$	56,153
Gross carrying amount	$	14,624		$	2,480		$	82,088		$	10,688		$	109,880
Accumulated amortization	(2,408		)	(1,536		)	(35,889		)	(2,987		)	(42,820		)
Accumulated impairment	—			—			(10,248		)	(659		)	(10,907		)
Balance as of June 30, 2019	$	12,216		$	944		$	35,951		$	7,042		$	56,153

⁽¹⁾ Book amortization period of 5-15 years. Amortized using the straight line and accelerated methods.

⁽²⁾ Book amortization period of 3-5 years. Amortized using the straight line method.

⁽³⁾ Book amortization period of 10-30 years. Amortized using the accelerated method.

⁽⁴⁾ Book amortization period of 3-20 years. Amortized using the straight line method.

34

	Trademark(1)			Non-Compete(2)			Customer Relationships(3)			All Others(4)			Total
Intangibles	(Dollars in Thousands)
Balance as of September 30, 2017	$	10,051		$	1,782		$	31,707		$	8,638		$	52,178
Acquisitions during the period	—			—			—			85			85
Amortization during the period	(477		)	(367		)	(4,548		)	(685		)	(6,077		)
Write-offs during the period	—			—			—			(88		)	(88		)
Balance as of June 30, 2018	$	9,574		$	1,415		$	27,159		$	7,950		$	46,098
Gross carrying amount	$	10,990		$	2,480		$	57,810		$	10,587		$	81,867
Accumulated amortization	(1,416		)	(1,065		)	(20,403		)	(2,020		)	(24,904		)
Accumulated impairment	—			—			(10,248		)	(617		)	(10,865		)
Balance as of June 30, 2018	$	9,574		$	1,415		$	27,159		$	7,950		$	46,098

⁽¹⁾ Book amortization period of 15 years. Amortized using the straight line and accelerated methods.

⁽²⁾ Book amortization period of 3 years. Amortized using the straight line method.

⁽³⁾ Book amortization period of 10-30 years. Amortized using the accelerated method.

⁽⁴⁾ Book amortization period of 3-20 years. Amortized using the straight line method.

The estimated amortization expense of intangible assets assumes no activities, such as acquisitions, which would result in additional amortizable intangible assets. Estimated amortization expense of intangible assets in the remaining three months of fiscal 2019 and subsequent fiscal years is as follows:

	(Dollars in Thousands)
Remaining in 2019	$	3,357
2020	10,986
2021	8,527
2022	6,402
2023	5,084
2024	4,367
Thereafter	17,430
Total anticipated intangible amortization	$	56,153

The Company tests intangible assets for impairment at least annually or more often if conditions indicate a possible impairment.  There was $0.1 million in impairments to intangible assets during the nine months ended June 30, 2019 and no impairments to intangible assets during the three months ended June 30, 2019 or the three and nine months ended June 30, 2018.

NOTE 9. STOCKHOLDERS' EQUITY

Retirement of Treasury Stock

On June 25, 2019, Meta retired $5.0 million, or 114,558 shares, of common stock held in treasury. The Company accounts for the retirement of repurchased shares, including treasury stock, using the par value method under which the repurchase price is charged to paid-in capital up to the amount of the original proceeds of those shares. When the repurchase price is greater than the original issue proceeds, the excess is charged to retained earnings.

Repurchase of Common Stock

On March 26, 2019, Meta announced a share repurchase program of up to 2.0 million of its outstanding shares of common stock, or approximately 5% of its outstanding shares. The program became effective on May 1, 2019 and is scheduled to expire on September 30, 2021. During the third quarter of fiscal 2019, Meta repurchased under the program a total of $43.0 million, or 1,574,734 shares of its common stock, at an average price of $27.31 per share. Under the repurchase program, repurchased shares were retired and designated as authorized but unissued shares, and the value of the shares reduced retained earnings. As of June 30, 2019, the remaining number of shares available for repurchase under this program was 425,266 shares of common stock.

35

For the nine months ended June 30, 2019, and 2018, the Company also repurchased 90,264 and 17,155 shares, or $3.0 million and $1.4 million, of common stock, respectively, in settlement of employee tax withholding obligations due upon the vesting of restricted stock.

NOTE 10. STOCK COMPENSATION

The Company maintains the amended and restated Meta Financial Group, Inc. 2002 Omnibus Incentive Plan, as amended (the "2002 Omnibus Incentive Plan"), which, among other things, provides for the awarding of stock options and nonvested (restricted) shares to certain officers and directors of the Company. Awards are granted by the Compensation Committee of the Board of Directors based on the performance of the award recipients or other relevant factors.

Compensation expense for share-based awards is recorded over the vesting period at the fair value of the award at the time of the grant. The exercise price of options or fair value of non-vested (restricted) shares granted under the Company’s incentive plan is equal to the fair market value of the underlying stock at the grant date. The Company has elected, with the adoption of ASU 2016-09, to record forfeitures as they occur.

The following tables show the activity of options and nonvested (restricted) shares granted, exercised, or forfeited under the 2002 Omnibus Incentive Plan for the nine months ended June 30, 2019:

	Number of Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Yrs)	Aggregate Intrinsic Value
	(Dollars in Thousands, Except Per Share Data (1))
Options outstanding, September 30, 2018	155,961		$	8.48	1.78	$	2,974
Granted	—		—		—	—
Exercised	(48,678	)	9.07		—	802
Forfeited or expired	(3,027	)	10.60		—	33
Options outstanding, June 30, 2019	104,256		$	8.14	1.22	$	2,075
Options exercisable, June 30, 2019	104,256		$	8.14	1.22	$	2,075

	Number of Shares		Weighted Average Fair Value at Grant
(Dollars in Thousands, Except Per Share Data (1))
Nonvested (restricted) shares outstanding, September 30, 2018	1,005,813		$	29.89
Granted	296,302		24.84
Vested	(352,218	)	26.77
Forfeited or expired	(2,679	)	26.14
Nonvested (restricted) shares outstanding, June 30, 2019	947,218		$	29.48

⁽¹⁾ All share and per share data has been adjusted to reflect the 3-for-1 forward stock split effected by the Company on October 4, 2018.

At June 30, 2019, stock-based compensation expense not yet recognized in income totaled $13.5 million, which is expected to be recognized over a weighted average remaining period of 3.09 years.

NOTE 11. INCOME TAXES

The Company recorded an income tax benefit of $3.2 million for the nine months ended June 30, 2019, resulting in an effective tax rate of (4.20%), compared to an income tax expense of $12.7 million, or an effective tax rate of 22.90%, for the nine months ended June 30, 2018. The Company’s effective tax rate is lower than the U.S. statutory rate of 21% primarily because of the anticipated effect of investment tax credits during fiscal year 2019. The Company’s effective tax rate in the future will depend in part on actual investment tax credits earned as part of its financing of solar energy projects.

36

The table below compares the income tax expense components for the periods presented.

Nine Months Ended June 30,	2019			2018
(Dollars in Thousands)
Provision at statutory rate	$	15,449		$	13,639
Tax-exempt income	(2,360		)	(5,506		)
State income taxes	3,243			2,314
Interim period effective rate adjustment	1,397			(1,070		)
Tax credit investments, net - federal	(22,484		)	—
Tax Reform rate adjustment	—			3,635
IRC 162(m) nondeductible compensation	1,612			—
Other, net	(101		)	(304		)
Income tax expense	$	(3,244	)	$	12,708
Effective tax rate	(4.2		%)	22.9		%

NOTE 12. COMMITMENTS AND CONTINGENCIES

In the normal course of business, the Bank makes various commitments to extend credit that are not reflected in the accompanying Consolidated Financial Statements.

At June 30, 2019 and September 30, 2018, unfunded loan commitments approximated $1.01 billion and $748.8 million, respectively, excluding undisbursed portions of loans in process. Commitments, which are disbursed subject to certain limitations, extend over various periods of time.  Generally, unused commitments are canceled upon expiration of the commitment term as outlined in each individual contract.

The Company had $1.7 million and $1.4 million in commitments to purchase securities at June 30, 2019 and September 30, 2018, respectively. The Company had no commitments to sell securities at June 30, 2019 or September 30, 2018.

The exposure to credit loss in the event of non-performance by other parties to financial instruments for commitments to extend credit is represented by the contractual amount of those instruments.  The same credit policies and collateral requirements are used in making commitments and conditional obligations as are used for on-balance-sheet instruments. At June 30, 2019 and at September 30, 2018, the Company had an allowance for credit losses on off-balance sheet credit exposures of $0.1 million. This amount is maintained as a separate liability account within other liabilities.

Since certain commitments to make loans and to fund lines of credit and loans in process expire without being used, the amount does not necessarily represent future cash commitments.  In addition, commitments used to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract.

As disclosed in Note 3. Acquisitions, the Company continues to monitor the bankruptcy proceedings and federal investigations of DC Solar. As of the date of the filing of this quarterly report, the Company has not accrued for any additional loss contingencies related to DC Solar as of June 30, 2019.

37

Legal Proceedings

The Bank was served on April 15, 2013, with a lawsuit captioned Inter National Bank v. NetSpend Corporation, MetaBank, BDO USA, LLP d/b/a BDO Seidman, Cause No. C-2084-12-I filed in the District Court of Hidalgo County, Texas. The Plaintiff’s Second Amended Original Petition and Application for Temporary Restraining Order and Temporary Injunction added both MetaBank and BDO Seidman to the original causes of action against NetSpend. NetSpend acts as a prepaid card program manager and processor for both Inter National Bank and MetaBank. The parties entered into a settlement agreement with respect to the litigation in May 2019, and the court dismissed the litigation in June 2019.

The Bank was served, on October 14, 2016, with a lawsuit captioned Card Limited, LLC v. MetaBank dba Meta Payment Systems, Civil No. 2:16-cv-00980 in the United States District Court for the District of Utah. This action was initiated by a former prepaid program manager of the Bank, which was terminated by the Bank in fiscal year 2016. Card Limited alleges that after all of the programs were wound down, there were two accounts with a positive balance to which they are entitled. The Bank’s position is that Card Limited is not entitled to the funds contained in said accounts. The total amount to which Card Limited claims it is entitled is $4.0 million. The Bank intends to vigorously defend this claim. An estimate of a range of reasonably possible loss cannot be made at this stage of the litigation because discovery is still being conducted.

On February 9, 2018, the Bank’s AFS/IBEX division filed a lawsuit in the United States District Court for the Eastern District of New York captioned AFS/IBEX, a division of MetaBank v. Aegis Managing Agency Limited ("AMA"), Aegis Syndicate 1225 (together with AMA, the "Aegis defendants"), CRC Insurance Services, Inc. ("CRC"), and Transportation Underwriters, Inc. The suit was filed against commercial insurance underwriters and brokers that facilitated the issuance of commercial insurance policies to Red Hook Construction Group-II, LLC (“Red Hook”). The Bank’s position is that both CRC and Transportation Underwriters represented to the Bank that, upon cancellation of the insurance policies prior to their stated terms, any unearned premiums would be refunded. The Bank then provided insurance premium financing to Red Hook, and Red Hook executed a written premium finance agreement pursuant to which Red Hook assigned its rights to any unearned premiums to the Bank. After the policies were cancelled, the Aegis defendants failed to return the unearned insurance premiums totaling just over $1.6 million owed to the Bank under the insurance policies and the premium finance agreement. The Bank is seeking recovery of all amounts to which it is entitled at law or equity and intends to vigorously pursue its claims against the defendants.

The Bank was served on December 24, 2018, with a lawsuit captioned The Ohio Valley Bank Company v. MetaBank dba Refund Advantage, Case No. 18 CV 134 in the Court of Common Pleas, Gallia County, Ohio. This action alleges that MetaBank breached a contract with The Ohio Valley Bank Company by terminating the contract before the term expired, resulting in over $3.0 million in damages. The Bank intends to vigorously defend this claim. The Company has established an accrual for this related claim.

From time to time, the Company or its subsidiaries are subject to certain legal proceedings and claims in the ordinary course of business. Accruals have been recorded when the outcome is probable and can be reasonably estimated. While management currently believes that the ultimate outcome of these proceedings will not have a material adverse effect on the Company’s financial position or its results of operations, legal proceedings are inherently uncertain and unfavorable resolution of some or all of these matters could, individually or in the aggregate, have a material adverse effect on the Company’s and its subsidiaries’ respective businesses, financial condition or results of operations.

38

NOTE 13. REVENUE FROM CONTRACTS WITH CUSTOMERS

On October 1, 2018, the Company adopted Topic 606 on a modified retrospective basis. Prior period amounts have not been adjusted to reflect the adoption of Topic 606 and continue to be reported in accordance with the Company’s historical accounting policies. The impact of the Company’s adoption of Topic 606 was limited to the MPS division within the Payments reporting segment. Upon adoption, Meta recorded a cumulative-effect adjustment that increased retained earnings by $1.5 million, net of tax.

Topic 606 applies to all contracts with customers unless such revenue is specifically addressed under existing guidance. The table below presents the Company’s revenue by operating segment. For additional descriptions of the Company’s operating segments, including additional financial information and the underlying management accounting process, see Note 15. Segment Reporting to the Consolidated Financial Statements.

(Dollars in thousands)	Payments					Banking				Corporate Services/Other						Consolidated Company
Three Months Ended June 30,	2019		2018			2019		2018		2019			2018			2019		2018
Net interest income(1)	$	15,232	$	6,298		$	60,043	$	18,077	$	(8,307	)	$	4,036		$	66,968	$	28,411
Noninterest income:
Refund transfer product fees	6,697		7,358			—		—		—			—			6,697		7,358
Tax advance product fees(1)	34		(46		)	—		—		—			—			34		(46		)
Card fees	19,445		22,717			92		90		—			—			19,537		22,807
Rental income(1)	4		—			9,382		—		—			—			9,386		—
Loan and lease fees(1)	—		—			1,012		1,111		—			—			1,012		1,111
Bank-owned life insurance(1)	—		—			—		—		628			633			628		633
Deposit fees	1,932		1,027			403		107		—			—			2,335		1,134
Gain (loss) on sale of securities available-for-sale, net(1)	—		—			—		—		440			(22		)	440		(22		)
Gain on sale of loans and leases(1)	—		—			1,913		—		—			—			1,913		—
Other income(1)	290		251			781		10		737			(11		)	1,808		250
Total noninterest income	28,402		31,307			13,583		1,318		1,805			600			43,790		33,225
Revenue	$	43,634	$	37,605		$	73,626	$	19,395	$	(6,502	)	$	4,636		$	110,758	$	61,636

⁽¹⁾ These revenues are not within the scope of Topic 606. Additional details are included in other footnotes to the accompanying financial statements. The scope of Topic 606 explicitly excludes net interest income as well as many other revenues for financial assets and liabilities, including loans, leases, and securities.

39

(Dollars in thousands)	Payments				Banking						Corporate Services/Other						Consolidated Company
Nine Months Ended June 30,	2019		2018		2019			2018			2019			2018			2019			2018
Net interest income(1)	$	38,238	$	15,900	$	168,107		$	49,794		$	(7,755	)	$	16,318		$	198,590		$	82,012
Noninterest income:
Refund transfer product fees	38,559		41,353		—			—			—			—			38,559			41,353
Tax advance product fees(1)	34,757		35,739		—			—			—			—			34,757			35,739
Card fees	61,678		74,662		261			248			—			—			61,939			74,910
Rental income(1)	5		—		30,162			—			—			—			30,167			—
Loan and lease fees(1)	—		—		3,185			3,445			—			—			3,185			3,445
Bank-owned life insurance(1)	—		—		—			—			1,901			1,952			1,901			1,952
Deposit fees	5,177		2,634		1,188			330			—			—			6,365			2,964
Gain (loss) on sale of securities available-for-sale, net(1)	—		—		—			—			649			(1,198		)	649			(1,198		)
Gain on sale of loans and leases(1)	—		—		3,865			—			—			—			3,865			—
Loss on foreclosed real estate(1)	—		—		(185		)	(19		)	—			—			(185		)	(19		)
Other income(1)	804		694		3,323			40			1,236			32			5,363			766
Total noninterest income	140,980		155,082		41,799			4,044			3,786			786			186,565			159,912
Revenue	$	179,218	$	170,982	$	209,906		$	53,838		$	(3,969	)	$	17,104		$	385,155		$	241,924

⁽¹⁾ These revenues are not within the scope of Topic 606. Additional details are included in other footnotes to the accompanying financial statements. The scope of Topic 606 explicitly excludes net interest income as well as many other revenues for financial assets and liabilities, including loans, leases, and securities.

Following is a discussion of key revenues within the scope of Topic 606. The Company provides services to customers that have related performance obligations that must be completed to recognize revenue. Revenues are generally recognized immediately upon the completion of the service or over time as services are performed. Any services performed over time generally require that the Company renders services each period, therefore the Company measures progress in completing these services based upon the passage of time. Revenue from contracts with customers did not generate significant contract assets and liabilities.

Refund Transfer Product Fees

Refund transfer fees are specific to the tax products offered by Refund Advantage and EPS. These fees are for products, services such as payment processing, and product referral commissions. Software partner fees paid and/or incurred are recorded on a net basis. The Company’s obligation for product fees and commissions is satisfied at the time of the product delivery and obligation for payment processing is satisfied at the time of processing. The transaction price for such activity is based upon stand-alone fees within the terms and conditions. As of June 30, 2019, there were no receivables related to refund transfer fees, which reflect earned revenue with unconditional rights to payment for product fee income, while as of September 30, 2018, there were $827,039 of such receivables. All refund transfer fees are recorded within the Payments reporting segment.

40

Card Fees

Card fees relate to MPS, retail bank, Refund Advantage and EPS products. These fees are for products and services such as card activation, product support, processing, and servicing. The Company earns these fees based upon the underlying terms and conditions with each cardholder over the contract term. Agreements with the Company’s cardholders are considered daily service contracts as they are not fixed in duration. The Company’s obligation for card activation and product support fees is satisfied at the time of product delivery, while the obligation for processing and servicing is satisfied over the course of each month. The transaction price for such activity is based upon the stand-alone fees within the terms and conditions of the cardholder agreements. Card fee revenue also includes income from sponsorships, associations and networks, and interchange income. Sponsorship income relates to fees charged to the Company’s ATM sponsorship partners, where the obligation is satisfied over the course of each month. Association and network income reflect incentives, performance bonuses and rebates with MasterCard and Visa. The obligation for such income is satisfied at the time when certain thresholds of transaction volume have been met. Interchange income is generated by cardholder activity, and therefore the Company’s obligations are satisfied as activity occurs. The transaction price for such activity is based on underlying rates and activity thresholds within the terms and conditions of the applicable agreements. Card fee revenue also includes breakage revenue. Breakage represents the estimated amount that will not be redeemed by the holder of unregistered, unused prepaid cards for goods or services. Breakage revenue is recognized ratably over the expected customer usage period and is an estimate based on cardholder behavior and breakage rates. Breakage is also impacted by escheatment laws. Card fees are recorded within the Payments and Banking reporting segments.

Deposit Fees

Fees are earned on depository accounts for commercial and consumer customers and include fees for account services, overdraft services, safety deposit box rentals, and event-driven services (i.e. returned checks, ATM surcharge, card replacement, wire transfers, and stop pays). The Company’s obligation for event-driven services is satisfied at the time of the event when the service is delivered, while its obligation for account services is satisfied over the course of each month. The Company’s obligation for overdraft services is satisfied at the time of overdraft. The transaction price for such activity is based upon stand-alone fees within the terms and conditions of the deposit agreements. Deposit fees are recorded within the Payments and Banking reporting segment.

Principal vs Agent

The Payments reporting segment includes principal/agent relationships. Within this segment, MPS relationships are recorded on a gross basis within the income statement, as Meta is the principal in the contract, with the exception of association/network contracts and partner/processer contracts for prepaid cards, which are recorded on a net basis within the income statement as Meta is the agent in these contracts. Also within this segment, Tax service relationships are recorded on a gross basis within the income statement, as Meta is the principal in the contract, with the exception of contracts with software providers and merchants, which are recorded on a net basis within the income statement as Meta is the agent in these contracts.

41

NOTE 14. FAIR VALUE MEASUREMENTS

Accounting Standards Codification (“ASC”) 820, Fair Value Measurements defines fair value, establishes a framework for measuring the fair value of assets and liabilities using a hierarchy system and requires disclosures about fair value measurement.  It clarifies that fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants in the market in which the reporting entity transacts.

The fair value hierarchy is as follows:

Level 1 Inputs - Valuation is based upon quoted prices for identical instruments traded in active markets that the Company has the ability to access at measurement date.

Level 2 Inputs - Valuation is based upon (1) quoted prices for similar instruments in active markets, (2) quoted prices for identical or similar instruments in markets that are not active and (3) model-based valuation techniques for which significant assumptions are observable in the market.

Level 3 Inputs - Valuation is generated from model-based techniques that use significant assumptions not observable in the market and are used only to the extent that observable inputs are not available. These unobservable assumptions reflect the Company’s own estimates of assumptions that market participants would use in pricing the asset or liability.  Valuation techniques include use of option pricing models, discounted cash flow models and similar techniques.

Debt Securities Available for Sale and Equity Securities. Debt securities available for sale and equity securities are recorded at fair value on a recurring basis and securities held to maturity are carried at amortized cost.  Fair value measurement is based upon quoted prices, if available.  If quoted prices are not available, fair values are measured using an independent pricing service. For both Level 1 and Level 2 securities, management uses various methods and techniques to corroborate prices obtained from the pricing service, including but not limited to reference to dealer or other market quotes, and by reviewing valuations of comparable instruments. The Company’s Level 1 securities include equity securities and mutual funds. Level 2 securities include U.S. Government agency and instrumentality securities, U.S. Government agency and instrumentality mortgage-backed securities, municipal bonds and corporate debt securities.  The Company had no Level 3 securities at June 30, 2019 or September 30, 2018.

The fair values of securities are determined by obtaining quoted prices on nationally recognized securities exchanges (Level 1 inputs), or valuation based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model based valuation techniques for which significant assumptions are observable in the market (Level 2 inputs). The Company considers these valuations supplied by a third party provider which utilizes several sources for valuing fixed-income securities. These sources include Interactive Data Corporation, Reuters, Standard and Poor’s, Bloomberg Financial Markets, Street Software Technology, and the third party provider’s own matrix and desk pricing.  The Company, no less than annually, reviews the third party’s methods and source’s methodology for reasonableness and to ensure an understanding of inputs utilized in determining fair value. Sources utilized by the third party provider include but are not limited to pricing models that vary based by asset class and include available trade, bid, and other market information. This methodology includes but is not limited to broker quotes, proprietary models, descriptive terms and conditions databases, as well as extensive quality control programs. Monthly, the Company receives and compares prices provided by multiple securities dealers and pricing providers to validate the accuracy and reasonableness of prices received from the third party provider. On a monthly basis, the Investment Committee reviews mark-to-market changes in the securities portfolio for reasonableness.

42

The following table summarizes the fair values of debt securities available for sale and equity securities at June 30, 2019 and September 30, 2018, as they are measured at fair value on a recurring basis.

	Fair Value At June 30, 2019
(Dollars in Thousands)	Total		Level 1		Level 2		Level 3
Debt securities AFS
SBA securities	$	193,066	$	—	$	193,066	$	—
Obligations of states and political subdivisions	875		—		875		—
Non-bank qualified obligations of states and political subdivisions	460,660		—		460,660		—
Asset-backed securities	307,296		—		307,296		—
Mortgage-backed securities	395,201		—		395,201		—
Total debt securities AFS	$	1,357,098	$	—	$	1,357,098	$	—
Common equities and mutual funds(1)(2)	$	4,419	$	4,419	$	—	$	—

⁽¹⁾ Equity securities at fair value are included within other assets on the consolidated statement of financial condition at June 30, 2019 and September 30, 2018.

⁽²⁾ ASU 2016-01 adopted on October 1, 2018, on a prospective basis, removed equity securities from AFS category at June 30, 2019.

	Fair Value At September 30, 2018
(Dollars in Thousands)	Total		Level 1		Level 2		Level 3
Debt securities AFS
SBA securities	$	44,337	$	—	$	44,337	$	—
Obligations of states and political subdivisions	16,910		—		16,910		—
Non-bank qualified obligations of states and political subdivisions	1,109,885		—		1,109,885		—
Asset-backed securities	313,028		—		313,028		—
Mortgage-backed securities	364,065		—		364,065		—
Total debt securities AFS	1,848,225		—		1,848,225		—
Common equities and mutual funds(1)	3,800		3,800		—		—
Total securities	$	1,852,025	$	3,800	$	1,848,225	$	—

⁽¹⁾ Equity securities at fair value are included within other assets on the consolidated statement of financial condition at June 30, 2019 and September 30, 2018.

The Company did not transfer any AFS debt securities or equity securities between fair value hierarchy categories at June 30, 2019 or September 30, 2018.

Loans and Leases.  The Company does not record loans and leases at fair value on a recurring basis.  If a loan or lease is identified as individually impaired, management then measures impairment in accordance with ASC 310, Receivables. See Note 4 Loans and Leases, Net for further information.

The following table summarizes the assets of the Company that were measured at fair value in the consolidated statements of financial condition on a non-recurring basis as of June 30, 2019 and September 30, 2018.

	Fair Value At June 30, 2019
(Dollars in Thousands)	Total		Level 1		Level 2		Level 3
Impaired Loans and Leases, net
Asset based lending	$	83	$	—	$	—	$	83
Factoring	3,960		—		—		3,960
Commercial finance	4,043		—		—		4,043
Total National Lending	4,043		—		—		4,043
Total impaired loans and leases	4,043		—		—		4,043
Foreclosed assets, net	29,514		—		—		29,514
Total	$	33,557	$	—	$	—	$	33,557

43

	Fair Value At September 30, 2018
(Dollars in Thousands)	Total		Level 1		Level 2		Level 3
Impaired loans and leases, net
Asset based lending	$	57	$	—	$	—	$	57
Factoring	1,899		—		—		1,899
Lease financing	2,869		—		—		2,869
Commercial finance	4,825		—		—		4,825
Total National Lending	4,825		—		—		4,825
Total impaired loans and leases	4,825		—		—		4,825
Foreclosed assets, net	31,638		—		—		31,638
Total	$	36,463	$	—	$	—	$	36,463

	Quantitative Information About Level 3 Fair Value Measurements
(Dollars in Thousands)	Fair Value at June 30, 2019		Fair Value at September 30, 2018	Valuation Technique	Unobservable Input	Range of Inputs
Impaired loans and leases, net	$	4,043	4,825	Market approach	Appraised values(1)	4.00 - 10.00%
Foreclosed assets, net	$	29,514	31,638	Market approach	Appraised values(1)	4.00 - 30.00%

⁽¹⁾ The Company generally relies on external appraisers to develop this information. Management reduced the appraised value by estimating selling costs and other inputs in a range of 4% to 30%.

The following table discloses the Company’s estimated fair value amounts of its financial instruments as of the dates set forth below.  It is management’s belief that the fair values presented below are reasonable based on the valuation techniques and data available to the Company as of June 30, 2019 and September 30, 2018, as more fully described below.  The operations of the Company are managed from a going concern basis and not a liquidation basis.  As a result, the ultimate value realized for the financial instruments presented could be substantially different when actually recognized over time through the normal course of operations.  Additionally, a substantial portion of the Company’s inherent value is the Bank’s capitalization and franchise value.  Neither of these components have been given consideration in the presentation of fair values below.

44

The following presents the carrying amount and estimated fair value of the financial instruments held by the Company at June 30, 2019 and September 30, 2018.

	June 30, 2019
(Dollars in Thousands)	Carrying Amount		Estimated Fair Value		Level 1		Level 2		Level 3
Financial assets
Cash and cash equivalents	$	100,732	$	100,732	$	100,732	$	—	$	—
Debt securities available for sale	1,357,098		1,357,098		—		1,357,098		—
Debt securities held to maturity	145,542		142,938		—		142,938		—
Equity securities(1)	4,419		4,419		4,419		—		—
Total securities	1,507,059		1,504,455		4,419		1,500,036		—
Loans held for sale	62,839		62,839		—		62,839		—
Loans and leases:
Asset based lending	615,309		599,664		—		—		599,664
Factoring	320,344		316,278		—		—		316,278
Lease financing	341,957		338,804		—		—		338,804
Insurance premium finance	358,772		358,401		—		—		358,401
SBA/USDA	99,791		94,391		—		—		94,391
Other commercial finance	99,677		101,145		—		—		101,145
Commercial finance	1,835,850		1,808,683		—		—		1,808,683
Consumer credit products	155,539		156,539		—		—		156,539
Other consumer finance	164,727		160,239		—		—		160,239
Consumer finance	320,266		316,778		—		—		316,778
Tax services	24,410		8,985		—		—		8,985
Warehouse finance	250,003		250,053		—		—		250,053
Total National Lending	2,430,529		2,384,499		—		—		2,384,499
Commercial real estate and operating	877,412		867,725		—		—		867,725
Consumer one to four family real estate and other	256,853		258,359		—		—		258,359
Agricultural real estate and operating	61,169		59,270		—		—		59,270
Total Community Banking	1,195,434		1,185,354		—		—		1,185,354
Total loans and leases	3,625,963		3,569,853		—		—		3,569,853
Federal Home Loan Bank stock	17,236		17,236		—		17,236		—
Accrued interest receivable	19,722		19,722		19,722		—		—
Financial liabilities
Noninterest-bearing demand deposits	2,751,931		2,751,931		2,751,931		—		—
Interest-bearing demand deposits, savings, and money markets	278,585		278,585		278,585		—		—
Time certificates of deposits	116,698		116,657		—		116,657		—
Wholesale non-maturing deposits	216,598		216,598		216,598		—		—
Wholesale time certificates of deposits	1,411,402		1,412,931		—		1,412,931		—
Total deposits	4,775,214		4,776,702		3,247,114		1,529,588		—
Overnight federal funds purchased	135,000		135,000		135,000		—		—
Long-term Federal Home Loan Bank advances	110,000		110,578		—		110,578		—
Securities sold under agreements to repurchase	3,658		3,658		—		3,658		—
Capital leases	1,972		1,972		—		1,972		—
Trust preferred securities	13,661		13,879		—		13,879		—
Subordinated debentures	73,605		76,875		—		76,875		—
Other borrowings	18,482		18,307		—		18,307		—
Accrued interest payable	12,350		12,350		12,350		—		—

⁽¹⁾ Equity securities at fair value are included within other assets on the consolidated statement of financial condition at June 30, 2019 and September 30, 2018.

45

	September 30, 2018
(Dollars in Thousands)	Carrying Amount		Estimated Fair Value		Level 1		Level 2		Level 3
Financial assets
Cash and cash equivalents	$	99,977	$	99,977	$	99,977	$	—	$	—
Securities available for sale	1,852,025		1,852,025		3,800		1,848,225		—
Securities held to maturity	172,154		160,974		—		160,974		—
Total securities	2,024,179		2,012,999		3,800		2,009,199		—
Loans held for sale	15,606		15,606		—		15,606		—
Loans and leases:
Asset based lending	477,917		477,471		—		—		477,471
Factoring	284,221		283,424		—		—		283,424
Lease financing	265,315		264,679		—		—		264,679
Insurance premium finance	337,877		337,212		—		—		337,212
SBA/USDA	59,374		61,072		—		—		61,072
Other commercial finance	85,145		83,111		—		—		83,111
Commercial finance	1,509,849		1,506,969		—		—		1,506,969
Consumer credit products	80,605		80,633		—		—		80,633
Other consumer finance	189,756		197,320		—		—		197,320
Consumer finance	270,361		277,953		—		—		277,953
Tax services	1,073		1,073		—		—		1,073
Warehouse finance	65,000		64,978		—		—		64,978
Total National Lending	1,846,283		1,850,973		—		—		1,850,973
Commercial real estate and operating	790,890		773,203		—		—		773,203
Consumer one to four family real estate and other	247,318		244,730		—		—		244,730
Agricultural real estate and operating	60,498		58,849		—		—		58,849
Total Community Banking	1,098,706		1,076,782		—		—		1,076,782
Total loans and leases	2,944,989		2,927,755		—		—		2,927,755
Federal Home Loan Bank stock	23,400		23,400		—		23,400		—
Accrued interest receivable	22,016		22,016		22,016		—		—
Financial liabilities
Noninterest-bearing demand deposits	2,405,274		2,405,274		2,405,274		—		—
Interest-bearing demand deposits, savings, and money markets	218,347		218,347		218,347		—		—
Time certificates of deposits	276,180		273,800		—		273,800		—
Wholesale non-maturing deposits	94,384		94,384		94,384		—		—
Wholesale time certificates of deposits	1,436,802		1,432,146		—		1,432,146		—
Total deposits	4,430,987		4,423,951		2,718,005		1,705,946		—
Overnight federal funds purchased	422,000		422,000		422,000		—		—
Securities sold under agreements to repurchase	3,694		3,694		—		3,694		—
Capital leases	1,876		1,876		—		1,876		—
Trust preferred securities	13,661		13,866		—		13,866		—
Subordinated debentures	73,491		75,563		—		75,563		—
Accrued interest payable	7,794		7,794		7,794		—		—

46

The following sets forth the methods and assumptions used in determining the fair value estimates for the Company’s financial instruments at June 30, 2019 and September 30, 2018.

CASH AND CASH EQUIVALENTS

The carrying amount of cash and short-term investments is assumed to approximate the fair value.

DEBT SECURITIES AVAILABLE FOR SALE AND EQUITY SECURITIES

Debt securities available for sale and equity securities are recorded at fair value on a recurring basis. Fair values for these investment securities are based on obtaining quoted prices on nationally recognized securities exchanges, or matrix pricing, which is a mathematical technique widely used in the industry to value debt securities without relying exclusively on quoted prices for the specific securities, but rather by relying on the securities’ relationship to other benchmark quoted securities.

LOANS HELD FOR SALE

The carrying amount of loans held for sale is assumed to approximate the fair value.

LOANS AND LEASES, NET

Upon adoption of ASU 2016-01, the fair value of loans and leases were estimated using an exit price methodology. The exit price estimation of fair value is based on the present value of expected cash flows, which are based on the contractual terms of the loans, adjusted for prepayments and a discount rate based on the relative risk of the cash flows. Other considerations include the loan type, remaining life of the loan and credit risk. In comparison, loan and lease fair values as of September 30, 2018 were estimated on an entrance price methodology, which discounts future cash flows using the then-current rates at which a similar loan would be made to borrowers with similar credit ratings and for the same remaining maturities. The fair value of non-impaired loans and leases as of June 30, 2019 and September 30, 2018 are not comparable.

FEDERAL HOME LOAN BANK (“FHLB”) STOCK

The fair value of FHLB stock is assumed to approximate book value since the Company is only able to redeem this stock at par value.

ACCRUED INTEREST RECEIVABLE

The carrying amount of accrued interest receivable is assumed to approximate the fair value.

DEPOSITS

The carrying values of noninterest-bearing checking deposits, interest-bearing checking deposits, savings, money markets, and wholesale non-maturing deposits are assumed to approximate fair value since deposits are immediately withdrawable without penalty. The fair value of time certificate deposits and wholesale certificate deposits are estimated using a discounted cash flows calculation that applies the FHLB Des Moines curve to aggregated expected maturities of time deposits. In accordance with Subtopic 825-10, Financial Instruments, no value has been assigned to the Company’s long-term relationships with its deposit customers (core value of deposits intangible) since such intangible is not a financial instrument as defined under Subtopic 825-10.

ADVANCES FROM FHLB

The fair value of such advances was estimated by discounting the expected future cash flows using current interest rates for advances with similar terms and remaining maturities.

FEDERAL FUNDS PURCHASED

The carrying amount of federal funds purchased is assumed to approximate the fair value.

SECURITIES SOLD UNDER AGREEMENTS TO REPURCHASE, SUBORDINATED DEBENTURES AND OTHER BORROWINGS

The fair value of these instruments was estimated by discounting the expected future cash flows using derived interest rates approximating market over the contractual maturity of such borrowings.

ACCRUED INTEREST PAYABLE

The carrying amount of accrued interest payable is assumed to approximate the fair value.

47

LIMITATIONS

Fair value estimates are made at a specific point in time and are based on relevant market information about the financial instrument.  Additionally, fair value estimates are based on existing on- and off-balance sheet financial instruments without attempting to estimate the value of anticipated future business, customer relationships and the value of assets and liabilities that are not considered financial instruments.  These estimates do not reflect any premium or discount that could result from offering the Company’s entire holdings of a particular financial instrument for sale at one time.  Furthermore, since no market exists for certain of the Company’s financial instruments, fair value estimates may be based on judgments regarding future expected loss experience, current economic conditions, risk characteristics of various financial instruments and other factors.  These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with a high level of precision.  Changes in assumptions as well as tax considerations could significantly affect the estimates.  Accordingly, based on the limitations described above, the aggregate fair value estimates are not intended to represent the underlying value of the Company, on either a going concern or a liquidation basis.

NOTE 15. SEGMENT REPORTING

An operating segment is generally defined as a component of a business for which discrete financial information is available and whose results are reviewed by the chief operating decision-maker. Operating segments are aggregated into reportable segments if certain criteria are met.

The Company reports its results of operations through the following three business segments: Payments, Banking, and Corporate Services/Other. The Meta Payment Systems and Tax Services divisions are reported in the Payments segment. The Community Banking, Commercial Finance and Consumer Finance divisions are reported in the Banking segment. Certain shared services, including the investment portfolio, wholesale deposits and borrowings, are included in the Corporate Services/Other segment.

The following tables present segment data for the Company for the three and nine months ended June 30, 2019 and 2018, respectively.

	Payments		Banking		Corporate Services/Other			Total
Three Months Ended June 30, 2019
Net interest income (expense)	$	15,232	$	60,043	$	(8,307	)	$	66,968
Provision for loan and lease losses	914		8,198		—			9,112
Noninterest income	28,402		13,583		1,805			43,790
Noninterest expense	17,559		33,233		21,676			72,468
Income (loss) before income tax expense (benefit)	25,161		32,195		(28,178		)	29,178
Total assets	196,257		4,169,351		1,735,464			6,101,072
Total goodwill	87,145		220,796		—			307,941
Total deposits	2,795,009		297,861		1,682,344			4,775,214

	Payments		Banking		Corporate Services/Other			Total
Nine Months Ended June 30, 2019
Net interest income (expense)	$	38,238	$	168,107	$	(7,755	)	$	198,590
Provision for loan and lease losses	24,883		26,646		—			51,529
Noninterest income	140,980		41,799		3,786			186,565
Noninterest expense	71,098		109,598		76,320			257,016
Income (loss) before income tax expense (benefit)	83,237		73,662		(80,289		)	76,610
Total assets	196,257		4,169,351		1,735,464			6,101,072
Total goodwill	87,145		220,796		—			307,941
Total deposits	2,795,009		297,861		1,682,344			4,775,214

48

	Payments		Banking		Corporate Services/Other			Total
Three Months Ended June 30, 2018
Net interest income	$	6,298	$	18,077	$	4,036		$	28,411
Provision for loan losses	1,189		4,126		—			5,315
Noninterest income	31,307		1,318		600			33,225
Noninterest expense	27,796		7,172		14,085			49,053
Income (loss) before income tax expense (benefit)	8,620		8,097		(9,449		)	7,268
Total assets	190,437		1,623,715		2,355,007			4,169,159
Total goodwill	87,145		11,578		—			98,723
Total deposits	2,641,838		241,572		638,223			3,521,633

	Payments		Banking		Corporate Services/Other			Total
Nine Months Ended June 30, 2018
Net interest income	$	15,900	$	49,794	$	16,318		$	82,012
Provision for loan losses	20,335		4,391		—			24,726
Noninterest income	155,082		4,044		786			159,912
Noninterest expense	99,592		20,723		41,277			161,592
Income (loss) before income tax expense (benefit)	51,055		28,724		(24,173		)	55,606
Total assets	190,437		1,623,715		2,355,007			4,169,159
Total goodwill	87,145		11,578		—			98,723
Total deposits	2,641,838		241,572		638,223			3,521,633

NOTE 16. SUBSEQUENT EVENTS

Management has evaluated subsequent events that occurred after June 30, 2019. During this period, up to the filing date, management did not identify any material subsequent events that would require recognition or disclosure in our consolidated financial statements as of or for the quarter ended June 30, 2019.

49

Item 2.    Management’s Discussion and Analysis of Financial Condition and Results of Operations.

META FINANCIAL GROUP, INC®.

AND SUBSIDIARIES

FORWARD LOOKING STATEMENTS

Meta Financial Group, Inc.®, (“Meta” or “the Company” or “us”) and its wholly-owned subsidiary, MetaBank® (the “Bank” or “MetaBank”), may from time to time make written or oral “forward-looking statements,” including statements contained in this Quarterly Report on Form 10-Q, in the Company's other filings with the Securities and Exchange Commission (“SEC”), in its reports to stockholders, and in other communications by the Company and the Bank, which are made in good faith by the Company pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995.

You can identify forward-looking statements by words such as “may,” “hope,” “will,” “should,” “expect,” “plan,” “anticipate,” “intend,” “believe,” “estimate,” “predict,” “potential,” “continue,” “could,” “future,” or the negative of those terms, or other words of similar meaning or similar expressions. You should carefully read statements that contain these words because they discuss our future expectations or state other “forward-looking” information. These forward-looking statements are based on information currently available to us and assumptions about future events, and include statements with respect to the Company’s beliefs, expectations, estimates, and intentions, which are subject to significant risks and uncertainties, and are subject to change based on various factors, some of which are beyond the Company’s control. Such risks, uncertainties and other factors may cause our actual growth, results of operations, financial condition, cash flows, performance and business prospects and opportunities to differ materially from those expressed in, or implied by, these forward-looking statements. Such statements may address, among others, the following subjects: future operating results; our ability to remediate the material weakness in our internal controls over financial reporting and otherwise maintain effective internal controls over financial reporting; customer retention; loan and other product demand; important components of the Company's statements of financial condition and operations; growth and expansion; new products and services, such as those offered by MetaBank or the Company's Payments divisions (which include Meta Payment Systems, Refund Advantage, EPS Financial and Specialty Consumer Services); credit quality and adequacy of reserves; technology; and the Company's employees. The following factors, among others, could cause the Company's financial performance and results of operations to differ materially from the expectations, estimates, and intentions expressed in such forward-looking statements: maintaining our executive management team; the expected growth opportunities, beneficial synergies and/or operating efficiencies from the Crestmark acquisition may not be fully realized or may take longer to realize than expected; customer losses and business disruption related to the Crestmark acquisition; unanticipated or unknown losses and liabilities may be incurred by the Company following the Crestmark acquisition; the costs, risks and effects on the Company of the ongoing federal investigation and bankruptcy proceedings involving DC Solar Solutions, Inc., DC Solar Distribution, Inc., and their affiliates, including the potential financial impact of those matters on the net book value of Company assets leased to DC Solar Distribution and the Company’s ability to recognize certain investment tax credits associated with such assets, and the results of the Company’s review of its due diligence processes with respect to the Company’s alternative energy assets; factors relating to the Company’s share repurchase program; actual changes in interest rates and the Fed Funds rate; additional changes in tax laws; the strength of the United States' economy, in general, and the strength of the local economies in which the Company conducts operations; risks relating to the recent U.S. government shutdown and any potential future government shutdown, including any adverse impact on our ability to originate or sell SBA/USDA loans and any delay by the Internal Revenue Service in processing taxpayer refunds, thereby increasing the cost to us of our refund advance loans; the effects of, and changes in, trade, monetary, and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System (the “Federal Reserve”), as well as efforts of the United States Congress and the United States Treasury in conjunction with bank regulatory agencies to stimulate the economy and protect the financial system; inflation, market, and monetary fluctuations; the timely and efficient development of, and acceptance of, new products and services offered by the Company or its strategic partners, as well as risks (including reputational and litigation) attendant thereto, and the perceived overall value of these products and services by users; the risks of dealing with or utilizing third parties, including, in connection with the Company’s refund advance business, the risk of reduced volume of refund advance loans as a result of reduced customer demand for or acceptance of usage of Meta’s strategic partners’ refund advance products; any actions which may be initiated by our regulators in the future; the impact of changes in financial services laws and regulations, including, but not limited to, laws and regulations relating to the tax refund industry and the insurance premium finance industry; our relationship with our primary regulators, the Office of the Comptroller of the Currency and the Federal Reserve, as well as the Federal Deposit Insurance Corporation, which insures MetaBank’s deposit accounts up to applicable limits; technological changes, including, but not limited to, the protection of electronic files or databases; acquisitions; litigation risk, in general, including, but not limited to, those risks involving MetaBank's divisions; the growth of the Company’s business, as well as expenses related thereto; continued maintenance by MetaBank of its status as a well-capitalized institution, particularly in light of our growing deposit base, a portion of which has been characterized as “brokered;” changes in consumer spending and saving habits; and the success of the Company at maintaining its high quality asset level and managing and collecting assets of borrowers in default should problem assets increase.

The foregoing list of factors is not exclusive.  We caution you not to place undue reliance on these forward-looking statements. The forward-looking statements included in this Quarterly Report speak only as of the date hereof.  All subsequent written and oral forward-looking statements attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this section.  Additional discussions of factors affecting the Company’s business and prospects are included under the caption "Risk Factors" and in other sections of the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2018 and in other filings made with the SEC.  The Company expressly disclaims any intent or obligation to update any forward-looking statements, whether written or oral, that may be made from time to time by or on behalf of the Company or its subsidiaries, whether as a result of new information, changed circumstances or future events or for any other reason.

50

GENERAL

The Company, a registered unitary savings and loan holding company, is a Delaware corporation, the principal assets of which are all the issued and outstanding shares of the Bank, a federal savings bank.  Unless the context otherwise requires, references herein to the Company include Meta and the Bank, and all direct or indirect subsidiaries of Meta on a consolidated basis.

The Company’s common stock trades on the NASDAQ Global Select Market under the symbol “CASH.”

The following discussion focuses on the consolidated financial condition of the Company at June 30, 2019, compared to September 30, 2018, and the consolidated results of operations for the three and nine months ended June 30, 2019 and 2018.  This discussion should be read in conjunction with the Company’s consolidated financial statements, and notes thereto, for the year ended September 30, 2018 and the related management's discussion and analysis of financial condition and results of operations contained in the Company's Annual Report on Form 10-K for the fiscal year ended September 30, 2018.

EXECUTIVE SUMMARY

In January 2019, the Company announced three key elements to its near-term plan that management expects will enhance long-term value for shareholders. The three key initiatives within the plan are as follows:

1) Increase the percentage of balance sheet funding from core deposits;

2) Optimize the interest-earning asset mix of the balance sheet; and

3) Improve operating efficiencies.

The Company recorded net income of $29.3 million, or $0.75 per diluted share, for the quarter ended June 30, 2019, comparing favorably to net income of $6.8 million, or $0.23 per diluted share, that was recorded for the fiscal 2018 third quarter. Total revenue for the fiscal 2019 third quarter was $110.8 million, compared to $61.6 million for the same quarter in fiscal 2018, an increase of 80%. The improvement in revenue and net income was driven primarily by the Company's improved earning asset mix in connection with the acquisition of Crestmark in the fourth quarter of fiscal 2018.

The continued growth in loans and leases during the third quarter of fiscal 2019, along with the continued optimization of the earning asset mix of the balance sheet, led to net interest income of $67.0 million and net interest margin ("NIM") of 5.07% and net interest margin, tax-equivalent ("NIM, TE") of 5.15%. The Company's average gross loans and leases increased by $2.04 billion, or 131%, while average noninterest-bearing deposits increased by $244.5 million, or 10%, when compared to the same period in fiscal 2018. Management anticipates that NIM will continue to expand over time as the Company continues to grow and optimize the loan and lease portfolio along with leveraging growth from its Payments division's low-cost deposits.

Noninterest income for the quarter ended June 30, 2019 increased to $43.8 million. Contributing to the increase were increases in rental income, gain on sale of loans and leases, other income, and deposit fees. For the quarter ended June 30, 2019, noninterest expense was $72.5 million. The increase in noninterest expense over the prior year fiscal third quarter was primarily due to the addition of the Crestmark division as a result of the Crestmark acquisition, which was not present in the comparable quarter in the prior fiscal year.

The Company announced during the second quarter of fiscal 2019 that its Board of Directors authorized a share repurchase program to repurchase up to 2,000,000 shares of the Company's outstanding common stock. During the third quarter of fiscal 2019, the Company repurchased 1,574,734 shares under the share repurchase program at an average price of $27.31, for a total of $43.0 million. The program became effective May 1, 2019 and is scheduled to expire on September 30, 2021.

51

FINANCIAL CONDITION

At June 30, 2019, the Company’s total assets increased by $266.0 million, or 5%, to $6.10 billion compared to $5.84 billion at September 30, 2018, primarily due to an increase in loans and leases, while partially being offset by a decrease in the investment portfolio.

Total cash and cash equivalents was $100.7 million at June 30, 2019, an increase of 1%, from $100.0 million at September 30, 2018. The Company maintains its cash investments primarily in interest-bearing overnight deposits with the FHLB of Des Moines and the Federal Reserve Bank.

The total investment portfolio decreased $517.3 million, or 26%, to $1.50 billion at June 30, 2019, compared to $2.02 billion at September 30, 2018, as maturities, sales, and principal pay downs exceeded purchases. The Company’s portfolio of securities customarily consists primarily of MBS, which have expected lives much shorter than the stated final maturity, non-bank qualified obligations of states and political subdivisions (“NBQ”), which mature in approximately 15 years or less, and other tax exempt municipal mortgage related pass through securities which have average lives much shorter than their stated final maturities. All MBS held by the Company at June 30, 2019 were issued by a U.S. Government agency or instrumentality. Of the total MBS, $395.2 million, at fair value, were classified as available for sale, and $7.4 million, at cost, were classified as held to maturity. Of the total investment securities, $961.9 million, at fair value, were classified as available for sale and $138.1 million, at cost, were classified as held to maturity. During the nine-month period ended June 30, 2019, the Company purchased $297.5 million of investment securities available for sale and no investment securities held to maturity or MBS securities.

The Company’s portfolio of gross loans and leases increased by $681.0 million, or 23%, to $3.63 billion at June 30, 2019, from $2.94 billion at September 30, 2018.

National Lending loans and leases increased $584.2 million, or 32% to $2.43 billion at June 30, 2019 compared to September 30, 2018. Within the National Lending portfolios, commercial finance loans and leases increased $326.0 million, warehouse finance portfolio increased $185.0 million, consumer finance portfolio increased $49.9 million, and the tax services loans increased $23.3 million at June 30, 2019 compared to September 30, 2018. Community Banking loans grew $96.7 million, or 9%, at June 30, 2019 compared to September 30, 2018, primarily due to growth in commercial real estate loans.

As of June 30, 2019, the remaining balance of acquired loans and leases from the Crestmark acquisition was $402.4 million and the remaining balances of the credit and interest rate mark discounts related to the acquired loans and leases held for investment were $6.8 million and $3.2 million, respectively, while the remaining balance of the interest rate mark premium related to the acquired loans held for sale was $0.7 million. On August 1, 2018, the Company acquired loans and leases from the Crestmark acquisition totaling $1.06 billion and recorded related credit and interest rate mark discounts of $12.3 million and $6.0 million, respectively.

Through the Bank, the Company owns stock in the FHLB due to the Bank’s membership and participation in this banking

system. The FHLB requires a level of stock investment based on a pre-determined formula. The Company’s investment in such stock decreased $6.2 million, or 26%, to $17.2 million at June 30, 2019, from $23.4 million at September 30, 2018. The decrease in FHLB stock directly correlates with lower short-term borrowings balances at June 30, 2019 compared to September 30, 2018.

Total end-of-period deposits increased $344.2 million, or 8%, at June 30, 2019 to $4.78 billion as compared to September 30, 2018, primarily related to increases of $346.7 million in noninterest-bearing deposits, $96.8 million in wholesale deposits and $46.2 million in interest-bearing checking deposits. The increase in total deposits was partially offset by a decrease of $159.5 million in certificates of deposit.

The average balance of total deposits and interest-bearing liabilities was $5.37 billion for the nine-month period ended June 30, 2019, compared to $3.83 billion for the same period of the prior fiscal year. The average balance of noninterest-bearing deposits for the nine-month period ended June 30, 2019 increased by $233.6 million, or 9%, to $2.72 billion compared to the same period in the prior year.

52

The Company's total borrowings decreased $158.3 million, or 31%, from $514.7 million at September 30, 2018 to $356.4 million at June 30, 2019, primarily due to a decrease in short-term borrowings. During the third quarter of fiscal 2019, the Company replaced a portion of its short-term borrowings with new long-term borrowings of $110.0 million. The Company’s short-term borrowings fluctuate on a daily basis due to the nature of a portion of its noninterest-bearing deposit base, primarily related to payroll processing timing with a higher volume of short-term borrowings on Monday and Tuesday, which are typically paid down throughout the week. This predictable fluctuation may be augmented near a month-end by a prefunding of certain programs. The Company also has an available no-fee line of credit with JP Morgan of $25.0 million with no funds advanced at June 30, 2019.

At June 30, 2019, the Company’s stockholders’ equity totaled $822.9 million, an increase of $75.2 million, from $747.7 million at September 30, 2018.  The increase was attributable to net earnings, an increase in additional paid-in capital and a change in accumulated other comprehensive income. At June 30, 2019, the Bank continued to exceed all regulatory requirements for classification as a well‑capitalized institution.  See “Liquidity and Capital Resources” for further information.

Non-performing Assets and Allowance for Loan and Lease Losses

Generally, when a loan or lease becomes delinquent 90 days or more or when the collection of principal or interest becomes doubtful, the Company will place the loan or lease on a non-accrual status and, as a result, previously accrued interest income on the loan or lease is reversed against current income. The loan or lease will generally remain on a non-accrual status until six months of good payment history has been established or management believes the financial status of the borrower has been significantly restored. Certain relationships in the table below are over 90 days past due and still accruing. The Company considers these relationships as being in the process of collection. Insurance premium finance loans, consumer finance and tax services loans are generally not placed on non-accrual status, but are instead written off when the collection of principal and interest become doubtful.

Loans and leases, or portions thereof, are charged off when collection of principal becomes doubtful. Generally, this is associated with a delay or shortfall in payments of greater than 210 days for insurance premium finance, 180 days for tax and other specialty lending loans, 120 days for consumer credit products and 90 days for other loans. Action is taken to charge off ERO loans if such loans have not been collected by the end of June and taxpayer advance loans if such loans have not been collected by the end of the calendar year. Non-accrual loans and troubled debt restructurings are generally considered impaired.

The Company believes that the level of allowance for loan and lease losses at June 30, 2019 was appropriate and reflected probable losses related to these loans and leases; however, there can be no assurance that all loans and leases will be fully collectible or that the present level of the allowance will be adequate in the future. See “Allowance for Loan and Lease Losses” below.

53

The table below sets forth the amounts and categories of non-performing assets in the Company’s portfolio as of the dates set forth below. Foreclosed assets include assets acquired in settlement of loans.

	Non-Performing Assets As Of
	June 30, 2019			September 30, 2018
	(Dollars in Thousands)
Non-performing loans and leases
Non-accruing loans and leases:
Asset based lending	$	5,654		$	—
Factoring	4,846			—
Lease financing	1,936			2,864
SBA/USDA	259			—
Commercial finance	12,695			2,864
Total National Lending	12,695			2,864
Consumer one-to-four family real estate and other	233			—
Total Community Banking	233			—
Total	12,928			2,864
Accruing loans and leases delinquent 90 days or more:
Asset based lending	180			94
Lease financing	4,225			726
Insurance premium finance	1,679			2,981
Commercial finance	6,084			3,801
Consumer credit products	703			147
Other consumer finance	1,083			2,237
Consumer finance	1,786			2,384
Tax services	—			1,073
Total National Lending	7,870			7,258
Consumer one-to-four family real estate and other	—			79
Total Community Banking	—			79
Total	7,870			7,337
Total non-performing loans and leases	20,798			10,201
Other assets
Non-performing operating leases	703			—
Foreclosed and repossessed assets:
Commercial finance	1,392			1,626
Consumer one-to-four family real estate and other	—			90
Agricultural real estate and operating	28,122			29,922
Total	29,514			31,638
Total other assets	30,217			31,638
Total non-performing assets	$	51,015		$	41,839
Total as a percentage of total assets	0.84		%	0.72		%

 

At June 30, 2019, non-performing loans and leases totaled $20.8 million, representing 0.57% of total loans and leases, compared to $10.2 million, or 0.35% of total loans and leases at September 30, 2018.

54

Classified Assets. Federal regulations provide for the classification of loans, leases, and other assets such as debt and equity securities considered by our primary regulator, the OCC, to be of lesser quality as “substandard,” “doubtful” or “loss,” with each such classification dependent on the facts and circumstances surrounding the assets in question. An asset is considered “substandard” if it is inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. “Substandard” assets include those characterized by the “distinct possibility” that the Bank will sustain “some loss” if the deficiencies are not corrected. Assets classified as “doubtful” have all of the weaknesses inherent in those classified “substandard,” with the added characteristic that the weaknesses present make “collection or liquidation in full,” on the basis of currently existing facts, conditions and values, “highly questionable and improbable.” Assets classified as “loss” are those considered “uncollectible” and of such minimal value that their continuance as assets without the establishment of a specific loss reserve is not warranted.

General allowances represent loss allowances which have been established to recognize the inherent risk associated with lending activities, but which, unlike specific allowances, have not been allocated to particular problem assets. When assets are classified as “loss,” the Bank is required either to establish a specific allowance for losses equal to 100% of that portion of the asset so classified or to charge off such amount. The Bank’s determinations as to the classification of its assets and the amount of its valuation allowances are subject to review by its regulatory authorities, which may order the establishment of additional general or specific loss allowances.

On the basis of management’s review of its loans, leases, and other assets, at June 30, 2019, the Company had classified $35.0 million of its assets as substandard and did not classify any assets as doubtful or loss. At September 30, 2018, the Company classified $24.6 million of its assets as substandard and did not classify any assets as doubtful or loss.

Allowance for Loan and Lease Losses. The allowance for loan and lease losses is established through a provision for loan and lease losses based on management’s evaluation of the risk inherent in its loan and lease portfolio and changes in the nature and volume of its loan and lease activity, including those loans and leases that are being specifically monitored by management. Such evaluation, which includes a review of loans and leases for which full collectability may not be reasonably assured, includes consideration of, among other matters, the estimated fair value of the underlying collateral, economic conditions, historical loan and lease loss experience and other factors that warrant recognition in providing for an appropriate loan and lease loss allowance.

Management closely monitors economic developments both regionally and nationwide, and considers these factors when assessing the appropriateness of its allowance for loan and lease losses. The current economic environment continues to show signs of stability in the Bank’s markets. The Bank’s average loss rates over the past three years were low relative to industry averages for such years, offset, in the case of fiscal 2016, with a higher agricultural loss rate driven by the charge-off of one relationship. The Bank does not believe it is likely these low loss conditions will continue indefinitely. Each loan and lease segment is evaluated using both historical loss factors as well as other qualitative factors, in order to determine the amount of risk the Company believes exists within that segment.

Management believes that, based on a detailed review of the loan and lease portfolio, historic loan and lease losses, current economic conditions, the size of the loan and lease portfolio and other factors, the level of the allowance for loan and lease losses at June 30, 2019 reflected an appropriate allowance against probable losses from the lending portfolio. Although the Company maintains its allowance for loan and lease losses at a level it considers to be appropriate, investors and others are cautioned that there can be no assurance that future losses will not exceed estimated amounts, or that additional provisions for loan and lease losses will not be required in future periods. In addition, the Company’s determination of the allowance for loan and lease losses is subject to review by the OCC, which can require the establishment of additional general or specific allowances.

At June 30, 2019, the Company had established an allowance for loan and lease losses totaling $43.5 million, compared to $13.0 million at September 30, 2018. The increase in the Company's allowance for loan and lease losses was driven primarily by increases in the allowance of $15.4 million in tax services loans, $11.0 million in the commercial finance portfolio, and $3.5 million in consumer finance loans. The change in the tax services portfolio was driven by additional provision expense related to loan originations by the Company's tax services division. Growth in the commercial finance portfolio was largely attributable to the Crestmark division while the increase in consumer finance is related to the Company now taking on all of the risk of the student loan portfolio, as the portfolio is no longer insured.

55

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The Company’s financial statements are prepared in accordance with GAAP. The financial information contained within these financial statements is, to a significant extent, based on approximate measures of the financial effects of transactions and events that have already occurred. Management has identified its critical accounting policies, which are those policies that, in management's view, are most important in the portrayal of our financial condition and results of operations, and include those for the allowance for loan and lease losses, goodwill and identifiable intangible assets. These policies involve complex and subjective decisions and assessments. Some of these estimates may be uncertain at the time they are made, could change from period to period, and could have a material impact on the financial statements. A discussion of the Company’s critical accounting policies and estimates can be found in the Company's Annual Report on Form 10-K for the year ended September 30, 2018. There were no significant changes to these critical accounting policies and estimates during the first nine months of fiscal year 2019.

RESULTS OF OPERATIONS

General. The Company recorded net income of $29.3 million, or $0.75 per diluted share, for the three months ended June 30, 2019, compared to net income of $6.8 million, or $0.23 per diluted share, for the three months ended June 30, 2018. Total revenue for the fiscal 2019 third quarter was $110.8 million, compared to $61.6 million for the same quarter in fiscal 2018, an increase of 80%. The increase in net income and revenue was primarily due to the improvement in net interest income, attributable to the acquisition of Crestmark in the fourth quarter of fiscal 2018, along with an enhanced interest-earning asset mix.

The Company recorded net income of $76.8 million, or $1.95 per diluted share, for the nine months ended June 30, 2019, compared to $42.9 million, or $1.47 per diluted share, for the same period in fiscal year 2018. Total revenue for the nine months ended June 30, 2019 was $385.2 million, compared to $241.9 million for the same period of the prior year, an increase of 59%.

Net Interest Income.  Net interest income for the fiscal 2019 third quarter increased by $38.6 million, or 136%, to $67.0 million from $28.4 million for the same quarter in fiscal 2018, primarily due to growth in loan and lease balances as well as an increase in loan and lease yields. The quarterly average outstanding balance of loans and leases as a percentage of interest-earning assets for the quarter ended June 30, 2019 increased to 68%, from 40% for the quarter ended June 30, 2018, while the quarterly average balance of total investments as a percentage of interest-earning assets decreased to 31% from 58% over that same period.

For the nine months ended June 30, 2019, net interest income was $198.6 million compared to $82.0 million for the same period in the prior year. This increase was primarily due to an enhanced interest-earning asset mix related to the acquired loans and leases in the Crestmark division, along with continued growth in the National Lending and Community Banking loan and lease portfolios.

Net interest margin was 5.07% in the fiscal 2019 third quarter, an increase of 213 basis points from 2.94% in the fiscal 2018 third quarter. NIM,TE was 5.15% in the fiscal 2019 third quarter, an increase of 192 basis points from 3.23% in the fiscal 2018 third quarter. The increases in NIM and NIM, TE in the fiscal 2019 third quarter, compared to the same period of the prior year, were primarily attributable to higher net loan and lease yields attained through the Crestmark division.

For the nine months ended June 30, 2019, NIM was 4.90%, increasing 213 basis points from 2.77% during the comparable prior year period. NIM, TE for the nine months ended June 30, 2019 was 5.02%, an increase of 196 basis points for the same period of the prior year.

The overall reported tax equivalent yield (“TEY”) on average earning assets increased by 244 basis points to 6.26% when comparing the fiscal 2019 third quarter to the same period of the prior fiscal year. The improvement was driven primarily by the Company's improved earning asset mix, which reflects increased balances in the National Lending portfolio. The fiscal 2019 third quarter TEY on the securities portfolio decreased by two basis points to 3.09% compared to the same period of the prior year TEY of 3.11%.

56

The Company’s average interest-earning assets for the fiscal 2019 third quarter increased by $1.43 billion, or 37%, to $5.30 billion, from the comparable quarter in 2018. The increase was primarily attributable to growth in the Company's average loan and lease portfolio of $2.04 billion, of which $1.88 billion was related to an increase in National Lending loans and leases and $159.9 million was related to Community Banking loans. This increase was partially offset by a decrease in total investment securities of $633.3 million, which decreased as the Company continued to utilize sales of securities and cash flow from its amortizing securities portfolio to fund loan growth.

The Company’s average balance of total deposits and interest-bearing liabilities was $5.14 billion for the three-month period ended June 30, 2019, compared to $3.70 billion for the same period in the prior year, representing an increase of 39%. This increase was primarily due to increases in average wholesale deposits of $1.07 billion, average noninterest-bearing deposits of $244.5 million, average time deposits of $67.8 million, average interest-bearing checking of $39.7 million, and the average balance of total borrowings of $20.5 million.

Overall, the Company's cost of funds for all deposits and borrowings averaged 1.14% during the fiscal 2019 third quarter, compared to 0.62% for the 2018 third fiscal quarter. This increase was primarily due to a rise in short-term interest rates affecting overnight borrowing rates, other wholesale funding, and the interest-bearing time deposits acquired by the Company in connection with the Crestmark acquisition in the fourth quarter of fiscal 2018. The Company's overall cost of deposits was 0.90% in the 2019 fiscal third quarter, compared to 0.29% in the same quarter of 2018.

The following tables present, for the periods indicated, the Company’s total dollar amount of interest income from average interest-earning assets and the resulting yields, as well as the interest expense on average interest-bearing liabilities, expressed both in dollars and rates.  Tax-equivalent adjustments have been made in yield on interest-bearing assets and net interest margin.  Non-accruing loans and leases have been included in the table as loans carrying a zero yield.

57

Three Months Ended June 30,	2019						2018
(Dollars in Thousands)	Average Outstanding Balance		Interest Earned / Paid		Yield / Rate(1)		Average Outstanding Balance		Interest Earned / Paid		Yield / Rate(2)
Interest-earning assets:
Cash & fed funds sold	$	80,100	$	521	2.61	%	$	57,164	$	388	2.72	%
Mortgage-backed securities	421,725		3,063		2.91	%	617,815		3,950		2.56	%
Tax exempt investment securities	690,732		4,058		2.98	%	1,373,444		8,635		3.34	%
Asset-backed securities	307,581		2,701		3.52	%	189,389		1,537		3.25	%
Other investment securities	199,681		1,557		3.13	%	72,381		538		2.98	%
Total investments	1,619,719		11,379		3.09	%	2,253,029		14,660		3.11	%
Total commercial finance	1,775,905		44,332		10.01	%	299,676		3,813		5.10	%
Total consumer finance	364,633		8,178		9.00	%	208,937		3,717		7.13	%
Total tax services	45,142		—		—	%	22,268		—		—	%
Total warehouse finance	223,546		3,491		6.26	%	—		—		—	%
National Lending loans and leases	2,409,226		56,001		9.32	%	530,881		7,530		5.69	%
Community Banking loans	1,189,912		13,731		4.63	%	1,030,016		11,526		4.49	%
Total loans and leases	3,599,138		69,732		7.77	%	1,560,897		19,056		4.90	%
Total interest-earning assets	5,298,957		$	81,632	6.26	%	3,871,090		$	34,104	3.82	%
Noninterest-earning assets	820,474						369,200
Total assets	$	6,119,431					$	4,240,290
Interest-bearing liabilities:
Interest-bearing checking	$	137,950	$	85	0.25	%	$	98,235	$	54	0.22	%
Savings	54,247		9		0.07	%	59,546		10		0.07	%
Money markets	58,782		107		0.73	%	46,742		28		0.24	%
Time deposits	128,165		633		1.98	%	60,373		167		1.11	%
Wholesale deposits	1,521,594		9,561		2.52	%	453,885		2,005		1.77	%
Total interest-bearing deposits	1,900,738		10,395		2.19	%	718,781		2,264		1.26	%
Overnight fed funds purchased	363,857		2,368		2.61	%	402,088		2,041		2.04	%
FHLB advances	54,341		324		2.39	%	—		—		—	%
Subordinated debentures	73,583		1,163		6.34	%	73,430		1,102		6.02	%
Other borrowings	40,653		414		4.08	%	36,408		286		3.15	%
Total borrowings	532,434		4,269		3.22	%	511,926		3,429		2.69	%
Total interest-bearing liabilities	2,433,172		14,664		2.42	%	1,230,707		5,693		1.86	%
Noninterest-bearing deposits	2,710,288		—		—	%	2,465,750		—		—	%
Total deposits and interest-bearing liabilities	5,143,460		$	14,664	1.14	%	3,696,457		$	5,693	0.62	%
Other noninterest-bearing liabilities	149,207						98,973
Total liabilities	5,292,667						3,795,430
Shareholders' equity	826,764						444,860
Total liabilities and shareholders' equity	$	6,119,431					$	4,240,290
Net interest income and net interest rate spread including noninterest-bearing deposits			$	66,968	5.12	%			$	28,411	3.21	%
Net interest margin					5.07	%					2.94	%
Tax-equivalent effect					0.08	%					0.29	%
Net interest margin, tax-equivalent(3)					5.15	%					3.23	%

⁽¹⁾ Tax rate used to arrive at the TEY for the three months ended June 30, 2019 was 21%.

⁽²⁾ Tax rate used to arrive at the TEY for the three months ended June 30, 2018 was 24.53%.

⁽³⁾ Net interest margin expressed on a fully-taxable-equivalent basis ("Net interest margin, tax-equivalent") is a non-GAAP financial measure. The tax-equivalent adjustment to net interest income recognizes the estimated income tax savings when comparing taxable and tax-exempt assets and adjusting for federal and state exemption of interest income. We believe that it is a standard practice in the banking industry to present net interest margin expressed on a fully-taxable-equivalent basis, and accordingly believe the presentation of this non-GAAP financial measure may be useful for peer comparison purposes.

58

Nine Months Ended June 30,	2019						2018
(Dollars in Thousands)	Average Outstanding Balance		Interest Earned / Paid		Yield / Rate (1)		Average Outstanding Balance		Interest Earned / Paid		Yield / Rate(2)
Interest-earning assets:
Cash & fed funds sold	$	148,751	$	2,989	2.69	%	$	96,496	$	1,717	2.38	%
Mortgage-backed securities	392,395		8,622		2.94	%	644,578		11,755		2.44	%
Tax exempt investment securities	952,501		17,999		3.20	%	1,404,571		26,333		3.32	%
Asset-backed securities	297,316		8,090		3.64	%	131,705		3,522		3.58	%
Other investment securities	150,888		3,301		2.93	%	75,877		1,662		2.93	%
Total investments	1,793,101		38,012		3.19	%	2,256,731		43,272		3.07	%
Total commercial finance	1,662,322		125,566		10.10	%	266,310		9,691		4.87	%
Total consumer finance	327,700		21,697		8.85	%	206,263		10,043		6.51	%
Total tax services	140,515		8,206		7.81	%	146,071		833		0.76	%
Total warehouse finance	168,081		7,912		6.29	%	—		—		—	%
National Lending loans and leases	2,298,618		163,382		9.50	%	618,644		20,567		4.44	%
Community Banking loans	1,175,667		40,519		4.61	%	986,902		32,777		4.44	%
Total loans and leases	3,474,285		203,900		7.85	%	1,605,546		53,344		4.44	%
Total interest-earning assets	5,416,137		$	244,902	6.16	%	3,958,773		$	98,333	3.61	%
Noninterest-earning assets	877,130						394,451
Total assets	$	6,293,267					$	4,353,224
Interest-bearing liabilities:
Interest-bearing checking	$	129,656	$	220	0.23	%	$	90,055	$	155	0.23	%
Savings	54,643		28		0.07	%	57,397		27		0.06	%
Money markets	56,987		263		0.62	%	47,814		82		0.23	%
Time deposits	160,740		2,229		1.85	%	102,636		877		1.14	%
Wholesale deposits	1,832,237		32,990		2.41	%	540,193		5,965		1.48	%
Total interest-bearing deposits	2,234,264		35,731		2.14	%	838,095		7,106		1.13	%
Overnight fed funds purchased	287,985		5,485		2.55	%	315,359		4,244		1.80	%
FHLB advances	18,114		324		2.39	%	91,392		947		1.39	%
Subordinated debentures	73,543		3,486		6.34	%	73,394		3,329		6.07	%
Other borrowings	43,690		1,286		3.93	%	26,343		695		3.53	%
Total borrowings	423,332		10,581		3.34	%	506,488		9,215		2.43	%
Total interest-bearing liabilities	2,657,595		46,312		2.33	%	1,344,583		16,321		1.62	%
Noninterest-bearing deposits	2,715,870		—		—	%	2,482,274		—		—	%
Total deposits and interest-bearing liabilities	5,373,465		$	46,312	1.15	%	3,826,857		$	16,321	0.57	%
Other noninterest-bearing liabilities	128,924						85,626
Total liabilities	5,502,389						3,912,483
Shareholders' equity	790,878						440,741
Total liabilities and shareholders' equity	$	6,293,267					$	4,353,224
Net interest income and net interest rate spread including noninterest-bearing deposits			$	198,590	5.01	%			$	82,012	3.04	%
Net interest margin					4.90	%					2.77	%
Tax-equivalent effect					0.12	%					0.29	%
Net interest margin, tax-equivalent(3)					5.02	%					3.06	%

(1) Tax rate used to arrive at the TEY for the nine months ended June 30, 2019 was 21%.

(2) Tax rate used to arrive at the TEY for the nine months ended June 30, 2018 was 24.53%.

(3) Net interest margin expressed on a fully-taxable-equivalent basis ("Net interest margin, tax-equivalent") is a non-GAAP financial measure. The tax-equivalent adjustment to net interest income recognizes the estimated income tax savings when comparing taxable and tax-exempt assets and adjusting for federal and state exemption of interest income. We believe that it is a standard practice in the banking industry to present net interest margin expressed on a fully-taxable-equivalent basis, and accordingly believe the presentation of this non-GAAP financial measure may be useful for peer comparison purposes.

59

Provision for Loan and Lease Losses.  The Company recorded a $9.1 million and a $51.5 million provision for loan and lease losses for the three- and nine-month periods ended June 30, 2019, respectively, as compared to a $5.3 million and a $24.7 million provision for loan and lease losses for the three- and nine-month periods ended June 30, 2018, respectively. Also see Note 4 to the Condensed Consolidated Financial Statements included in this quarterly report.

Noninterest Income.  Noninterest income for the fiscal 2019 third quarter increased by $10.6 million, or 32%, to $43.8 million from $33.2 million for the same period in the prior fiscal year, largely due to increases in rental income of $9.4 million, gain on sale of loans and leases of $1.9 million, other income of $1.6 million, and deposit fees of $1.2 million. Partially offsetting the increase in noninterest income, card fee income decreased $3.3 million and total tax product fee income decreased $0.6 million from the same quarter of the prior fiscal year. The increases in rental income, other income and gain on sale of loans and leases were largely attributable to the Crestmark acquisition.

Noninterest income for the nine months ended June 30, 2019 was $186.6 million, an increase of $26.7 million, or 17%, from the same period in the prior fiscal year. This increase was primarily due to an increase in rental income, other income, deposit fees, and an increase in gain on sale of investment securities.

Noninterest Expense.  Noninterest expense increased $23.4 million, or 48%, to $72.5 million for the 2019 fiscal third quarter, compared to the same quarter in 2018. This increase was primarily caused by increases of $10.7 million in compensation and benefits expense, $6.0 million in operating lease equipment depreciation expense, and $3.7 million in other expense. Increases in intangible amortization expense, occupancy and equipment, and legal and consulting also contributed to the increase in noninterest expense. The increase in compensation and benefits expense was primarily due to the addition of Crestmark division employees, and new hires in the second half of fiscal 2018 in support of Meta's National Lending and other business initiatives.

Noninterest expense for the nine months ended June 30, 2019 increased by $95.4 million, or 59%, to $257.0 million compared to the same period in the prior fiscal year. This increase was primarily caused by increases in compensation and benefits expense, other expense, impairment expense, intangible amortization expense, occupancy and equipment, and legal and consulting expense.

Income Tax. The Company recorded an income tax benefit for the fiscal 2019 third quarter of $1.2 million, resulting in an effective tax rate of (3.97%), compared to an income tax expense of $0.5 million, or an effective tax rate of 6.55%, for the fiscal 2018 third quarter. Investment tax credits related to solar leases and future originations in fiscal 2019 will be recognized ratably based on income over the duration of the current fiscal year. The timing and impact of future solar tax credits are expected to vary from period to period, and Meta intends to undertake only those tax credit opportunities that meet the Company's underwriting and return criteria.

LIQUIDITY AND CAPITAL RESOURCES

The Company’s primary sources of funds are deposits, derived principally through its Payments divisions, and to a lesser extent through its Community Banking division borrowings, principal and interest payments on loans and mortgage-backed securities, and maturing investment securities. In addition, the Company utilizes wholesale deposit sources to provide temporary funding when necessary or when favorable terms are available. While scheduled loan repayments and maturing investments are relatively predictable, deposit flows and early loan repayments are influenced by the level of interest rates, general economic conditions and competition. The Company uses its capital resources principally to meet ongoing commitments to fund maturing certificates of deposits and loan commitments, to maintain liquidity, and to meet operating expenses.  At June 30, 2019, the Company had commitments to originate and purchase loans and unused lines of credit totaling $1.01 billion. The Company believes that loan repayments and other sources of funds will be adequate to meet its foreseeable short- and long-term liquidity needs.

60

In July 2013, the Company’s primary federal regulator, the Federal Reserve and the Bank’s primary federal regulator, the OCC, approved final rules (the “Basel III Capital Rules”) establishing a new comprehensive capital framework for U.S. banking organizations, which replaced earlier frameworks adopted in 1988 ("Basel I") and 2004 (Basel II). The Basel III Capital Rules generally implement the Basel Committee on Banking Supervision’s (the “Basel Committee”) December 2010 final capital framework referred to as “Basel III” for strengthening international capital standards. The Basel III Capital Rules substantially revised the risk-based capital requirements applicable to financial institution holding companies and their depository institution subsidiaries, including us and the Bank, as compared to U.S. general risk-based capital rules. The Basel III Capital Rules revised the definitions and the components of regulatory capital, as well as addressed other issues affecting the numerator in banking institutions’ regulatory capital ratios. In addition, the Basel III Capital Rules implemented certain provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act, including the requirements of Section 939A to remove references to credit ratings from the federal agencies’ rules. The Basel III Capital Rules became effective for us and the Bank on January 1, 2015, subject to phase-in periods for certain of their components and other provisions.

Pursuant to the Basel III Capital Rules, the Company and the Bank, respectively, are subject to regulatory capital adequacy requirements promulgated by the Federal Reserve and the OCC. Failure by the Company or Bank to meet minimum capital requirements could result in certain mandatory and discretionary actions by our regulators that could have a material adverse effect on our consolidated financial statements. Under the capital requirements and the regulatory framework for prompt corrective action, the Company and the Bank must meet specific capital guidelines that involve quantitative measures of the Company’s and the Bank’s assets, liabilities and certain off-balance-sheet items as calculated under regulatory accounting practices. The Company’s and the Bank’s capital amounts and classifications are also subject to qualitative judgments by regulators about components, risk weightings and other factors.

Quantitative measures established by regulation to ensure capital adequacy require the Company and the Bank to maintain minimum ratios (set forth in the table below) of total risk-based capital and Tier 1 capital (as defined in the regulations) to risk-weighted assets (as defined), and a leverage ratio consisting of Tier 1 capital (as defined) to average assets (as defined). At June 30, 2019, both the Bank and the Company exceeded federal regulatory minimum capital requirements to be classified as well-capitalized under the prompt corrective action requirements.  The Company and the Bank took the accumulated other comprehensive income (“AOCI”) opt-out election; under the rule, non-advanced approach banking organizations were given a one-time option to exclude certain AOCI components. 

The tables below include certain non-GAAP financial measures that are used by investors, analysts and bank regulatory agencies to assess the capital position of financial services companies.  Management reviews these measures along with other measures of capital as part of its financial analysis.

					Minimum to be		Minimum to be
					Adequately		Well Capitalized
					Capitalized Under		Under Prompt
					Prompt Corrective		Corrective Action
At June 30, 2019	Company		Bank		Action Provisions		Provisions
Tier 1 leverage capital ratio	8.05	%	9.37	%	4.00	%	5.00	%
Common equity Tier 1 capital ratio	10.19		12.22		4.50		6.50
Tier 1 capital ratio	10.55		12.27		6.00		8.00
Total capital ratio	13.22		13.26		8.00		10.00

61

The following table provides certain non-GAAP financial measures used to compute certain of the ratios included in the table above, as well as a reconciliation of such non-GAAP financial measures to the most directly comparable financial measure in accordance with GAAP:

	Standardized Approach(1) June 30, 2019
	(Dollars in Thousands)
Total stockholders' equity	$	822,901
Adjustments:
LESS: Goodwill, net of associated deferred tax liabilities	302,850
LESS: Certain other intangible assets	53,249
LESS: Net deferred tax assets from operating loss and tax credit carry-forwards	13,858
LESS: Net unrealized gains (losses) on available-for-sale securities	2,329
LESS: Noncontrolling interest	3,508
Common Equity Tier 1 Capital (1)	447,107
Long-term borrowings and other instruments qualifying as Tier 1	13,661
Tier 1 minority interest not included in common equity tier 1 capital	2,119
Total Tier 1 Capital	462,887
Allowance for loan and lease losses	43,641
Subordinated debentures (net of issuance costs)	73,605
Total Capital	580,133

⁽¹⁾ Capital ratios were determined using the Basel III capital rules that became effective on January 1, 2015. Basel III revised the definition of capital, increased minimum capital ratios, and introduced a minimum common equity tier 1 capital ratio; those changes are being fully phased in through the end of 2021.

The following table provides a reconciliation of tangible common equity and tangible common equity excluding AOCI, each of which is used in calculating tangible book value data, to Total Stockholders' Equity at June 30, 2019. Each of tangible common equity and tangible common equity excluding AOCI is a non-GAAP financial measure that is commonly used within the banking industry.

	June 30, 2019
	(Dollars in Thousands)
Total Stockholders' Equity	$	822,901
LESS: Goodwill	307,941
LESS: Intangible assets	56,153
Tangible common equity	458,807
LESS: AOCI	2,308
Tangible common equity excluding AOCI	456,499

Since January 1, 2016, the Company and the Bank have been required to maintain a capital conservation buffer above the minimum risk-based capital requirements in order to avoid certain limitations on capital distributions, stock repurchases and discretionary bonus payments to executive officers. The capital conservation buffer is exclusively composed of Common Equity Tier 1 capital, and it applies to each of the three risk-based capital ratios but not the leverage ratio. The implementation of the capital conservation buffer by annual increments finished on January 1, 2019, so that the required Common Equity Tier 1 risk-based, Tier 1 risk-based and total risk-based capital ratios with the buffer are currently 7.0%, 8.5% and 10.5%, respectively.

Based on current and expected continued profitability and subject to continued access to capital markets, we believe that the Company and the Bank will continue to meet the capital conservation buffer of 2.5% in addition to required minimum capital ratios.

62

CONTRACTUAL OBLIGATIONS

See "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations-Contractual Obligations" in the Company’s Annual Report on Form 10-K for its fiscal year ended September 30, 2018 for a summary of our contractual obligations as of September 30, 2018. There were no material changes outside the ordinary course of our business in contractual obligations from September 30, 2018 through June 30, 2019.

OFF-BALANCE SHEET FINANCING ARRANGEMENTS

For discussion of the Company’s off-balance sheet financing arrangements as of June 30, 2019, see Note 12 to our consolidated financial statements included in Part I, Item 1 “Financial Statements” of this Quarterly Report on Form 10-Q. Depending on the extent to which the commitments or contingencies described in Note 12 occur, the effect on the Company’s capital and net income could be significant.

Item 3.    Quantitative and Qualitative Disclosures About Market Risk.

MARKET RISK

The Company derives a portion of its income from the excess of interest collected over interest paid. The rates of interest the Company earns on assets and pays on liabilities generally are established contractually for a period of time. Market interest rates change over time. Accordingly, the Company’s results of operations, like those of most financial institutions, are impacted by changes in interest rates and the interest rate sensitivity of its assets and liabilities. The risk associated with changes in interest rates and the Company’s ability to adapt to these changes is known as interest rate risk and is the Company’s only significant “market” risk.

The Company monitors and measures its exposure to changes in interest rates in order to comply with applicable government regulations and risk policies established by the Board of Directors, and in order to preserve stockholder value. In monitoring interest rate risk, the Company analyzes assets and liabilities based on characteristics including size, coupon rate, repricing frequency, maturity date and likelihood of prepayment.

The Company’s primary objective for its investment portfolio is to provide a source of liquidity for the Company. In addition, the investment portfolio may be used in the management of the Company’s interest rate risk profile. The investment policy generally calls for funds to be invested among various categories of security types and maturities based upon the Company’s need for liquidity, desire to achieve a proper balance between minimizing risk while maximizing yield, the need to provide collateral for borrowings, and the need to fulfill the Company’s asset/liability management goals.

The Company’s cost of funds responds to changes in interest rates due to the relatively short-term nature of its wholesale deposit portfolio and the relatively short-term nature of its borrowed funds. The Company believes that its growing portfolio of longer duration, low-cost deposits generated from its prepaid division provides a stable and profitable funding vehicle, but also subjects the Company to greater risk in a falling interest rate environment than it would otherwise have without this portfolio. This risk is due to the fact that, while asset yields may decrease in a falling interest rate environment, the Company cannot significantly reduce interest costs associated with these deposits, which thereby compress the Company’s net interest margin.

The Board of Directors and relevant government regulations establish limits on the level of acceptable interest rate risk at the Company, to which management adheres. There can be no assurance, however, that, in the event of an adverse change in interest rates, the Company’s efforts to limit interest rate risk will be successful.

63

Interest Rate Risk (“IRR”)

Overview. The Company actively manages interest rate risk, as changes in market interest rates can have a significant impact on reported earnings. The Bank, like other financial institutions, is subject to interest rate risk to the extent that its interest-bearing liabilities mature or reprice more rapidly than its interest-earning assets. The Company's interest rate risk analysis is designed to compare income and economic valuation simulations in market scenarios designed to alter the direction, magnitude and speed of interest rate changes, as well as the slope of the yield curve. The Company does not currently engage in trading activities to control interest rate risk although it may do so in the future, if deemed necessary, to help manage interest rate risk.

Earnings at risk and economic value analyses. As a continuing part of its financial strategy, the Bank considers methods of managing an asset/liability mismatch consistent with maintaining acceptable levels of net interest income. In order to monitor interest rate risk, the Board of Directors has created an Asset Liability Committee whose principal responsibilities are to assess the Bank’s asset/liability mix and implement strategies that will enhance income while managing the Bank’s vulnerability to changes in interest rates.

The Company uses two approaches to model interest rate risk: Earnings at Risk (“EAR analysis”) and Economic Value of Equity (“EVE analysis”). Under EAR analysis, net interest income is calculated for each interest rate scenario to the net interest income forecast in the base case. EAR analysis measures the sensitivity of interest-sensitive earnings over a one-year minimum time horizon. The results are affected by projected rates, prepayments, caps and floors. Management exercises its best judgment in making assumptions regarding events that management can influence, such as non-contractual deposit re-pricing, as well as events outside of management's control, such as customer behavior on loan and deposit activity and the effect that competition has on both loan and deposit pricing. These assumptions are subjective and, as a result, net interest income simulation results will differ from actual results due to the timing, magnitude, and frequency of interest rate changes, changes in market conditions, customer behavior and management strategies, among other factors. We perform various sensitivity analyses on assumptions of deposit attrition and deposit re-pricing, as well as market-implied forward rates and various likely and extreme interest rate scenarios, including rapid and gradual interest rate ramps, rate shocks and yield curve twists.

The EAR analysis used in the following table reflects the required analysis used no less than quarterly by management. It models -200, -100, +100, +200, +300, and +400 basis point parallel shifts in market interest rates over the next one-year period. Due to the current low level of interest rates, only -100 and -200 basis point parallel shifts are represented.

The Company was within Board policy limits for all interest rate scenarios as of June 30, 2019.  The table below shows the results of the scenarios as of June 30, 2019:

Net Sensitive Earnings at Risk
		Change in Interest Income/Expense for a given change in interest rates
		Over / (Under) Base Case Parallel Shift
(Dollars in thousands)	Book Value	-200		-100		Base		100		200		300		400
Total Interest-Sensitive Income	5,161,411	263,554		284,232		306,880		329,113		350,310		370,893		391,473
Total Interest-Sensitive Expense	2,292,395	23,527		35,702		48,132		60,551		72,664		84,779		96,897
Net Interest-Sensitive Income	2,869,016	240,027		248,530		258,748		268,562		277,646		286,114		294,576
Percentage Change from Base	—	-7.2	%	-3.9	%	—	%	3.8	%	7.3	%	10.6	%	13.8	%
Board Policy Limits	—	-12.0	%	-8.0	%	—	%	-8.0	%	-10.0	%	-15.0	%	-20.0	%

The EAR analysis reported at June 30, 2019, shows that in all rising rate scenarios, more assets than liabilities would reprice over the modeled one-year period.

64

IRR is a snapshot in time. The Company’s business and deposits are very predictably cyclical on a weekly, monthly and yearly basis. The Company’s static IRR results could vary depending on which day of the week and timing in relation to certain payrolls, as well as time of the month in regard to early funding of certain programs, when this snapshot is taken. The Company’s overnight federal funds purchased fluctuates on a predictable daily and monthly basis due to fluctuations in a portion of its noninterest-bearing deposit base, primarily related to payroll processing and timing of when certain programs are prefunded and when the funds are received.

The Company believes that its growing portfolio of noninterest-bearing deposits provides a stable and profitable funding vehicle and a significant competitive advantage in a rising interest rate environment, as the Company’s cost of funds would likely remain low, with less of an increase in the cost of funds expected relative to many other banks.

Under EVE analysis, the economic value of financial assets, liabilities and off-balance sheet instruments, is derived under each rate scenario. The economic value of equity is calculated as the difference between the estimated market value of assets and liabilities, net of the impact of off-balance sheet instruments.

The EVE analysis used in the following table reflects the required analysis used no less than quarterly by management. It models immediate -200, -100, +100, +200, +300 and +400 basis point parallel shifts in market interest rates. Due to the current low level of interest rates, only -100 and -200 basis point parallel shifts are represented.

The Company was within Board policy limits for all scenarios. The table below shows the results of the scenarios as of June 30, 2019:

Economic Value Sensitivity as of June 30, 2019

	Standard (Parallel Shift)
	Economic Value of Equity at Risk%
	-200		-100		100		200		300		400
Percentage Change from Base	-12.9	%	-5.2	%	2.5	%	3.5	%	3.6	%	3.6	%
Board Policy Limits	-20.0	%	-10.0	%	-10.0	%	-20.0	%	-25.0	%	-35.0	%

The EVE at risk reported at June 30, 2019 shows that as interest rates increase, the economic value of equity position will be relatively neutral. When viewing total asset versus total liability economic value, projected total assets are affected similarly on a percentage basis as compared to projected total liabilities in a rising rate environment.

65

Item 4.    Controls and Procedures.

CONTROLS AND PROCEDURES

Any control system, no matter how well designed and operated, can provide only reasonable (not absolute) assurance that its objectives will be met.  Furthermore, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in a cost-effective control system, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected.

DISCLOSURE CONTROLS AND PROCEDURES

The Company’s management, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Company’s “disclosure controls and procedures”, as such term is defined in Rules 13a - 15(e) and 15d - 15(e) of the Securities Exchange Act of 1934 (“Exchange Act”) as of the end of the period covered by this quarterly report.

Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, at June 30, 2019, the Company’s disclosure controls and procedures were not effective to provide reasonable assurance that (i) the information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and (ii) information required to be disclosed by us in our reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. The ineffectiveness of the Company's disclosure controls and procedures was due to a material weakness identified in the Company's internal controls over financial reporting, which is described below. A material weakness is a deficiency, or a combination of deficiencies, in internal controls over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company's annual or interim financial statements will not be prevented or detected on a timely basis.

In the third fiscal quarter of 2019, the Company identified a material weakness in the control environment of the Crestmark division, which was acquired by the Company on August 1, 2018. Several deficiencies were identified in the Company's control environment that were primarily related to inappropriate user access specific to information technology ("IT") applications used by the Crestmark division and lack of completeness of certain review procedures with respect to such user access. The user access issues included untimely completion of user access reviews on certain systems, instances of users having access rights beyond what appeared to be needed, and instances of user access not being appropriately added or removed from certain systems. The lack of completeness of certain review procedures was, in many cases, due to a completeness control not being documented, meaning that subject reports had not been compared to the source document to determine all required data was included in the report. These deficiencies did not result in any known material misstatement to the Company's annual or interim financial statements to date following the Crestmark acquisition. Accordingly, management determined the aggregation of these deficiencies represents a material weakness in internal controls over financial reporting on the basis that they could result in a misstatement potentially impacting the Company's financial statement accounts and disclosures that would not be prevented or detected on a timely basis. Also, the IT deficiencies could impact maintaining effective segregation of duties, as well as the effectiveness of IT-dependent controls relating to the financial statements. In addition, these deficiencies could affect the IT controls and underlying data that support the effectiveness of system-generated reports.

66

REMEDIATION PLAN FOR REPORTED MATERIAL WEAKNESS

The Company is engaged in implementing a remediation plan to address the material weakness described above and is committed to maintaining a strong internal controls environment. To address the material weakness, the Company is in the process of re-evaluating IT governance and controls, updating procedures related to access management, and training IT personnel, with a focus on controls related to user access over IT systems. The Company is also ensuring review procedures at the Crestmark division are being performed with complete populations of data. Management believes that the measures described above will effectively remediate the identified material weakness and strengthen the Company’s internal controls over financial reporting. However, we cannot assure you that these steps will remediate such weakness or whether additional actions will be required or the timing or costs of any such additional actions. Because the reliability of the internal controls process requires repeatable execution, the successful remediation of this material weakness will require review and evidence of effectiveness prior to management concluding that the controls are effective. Management believes that remediation efforts will be completed during the fourth quarter of fiscal 2019.  If not remediated, however, these deficiencies could result in material misstatements to the Company's consolidated financial statements.

INTERNAL CONTROLS OVER FINANCIAL REPORTING

With the participation of the Company’s management, including its Chief Executive Officer and Chief Financial Officer, the Company conducted an evaluation of the Company’s internal controls over financial reporting to determine whether any changes occurred during the Company’s fiscal quarter ended June 30, 2019, that have materially affected, or are reasonably likely to materially affect, the Company’s internal controls over financial reporting.  Based on such evaluation, management concluded that, as of the end of the period covered by this report, there have not been any changes in the Company’s internal controls over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, the Company’s internal controls over financial reporting except as set forth above.

67

META FINANCIAL GROUP, INC.

PART II - OTHER INFORMATION

FORM 10-Q

Item 1. Legal Proceedings. - See “Legal Proceedings” under Note 12 to the Notes to Condensed Consolidated Financial Statements, which is incorporated herein by reference.

Item 1A. Risk Factors. - A description of our risk factors can be found in "Item 1A. Risk Factors" included in our Annual Report on Form 10-K for the fiscal year ended September 30, 2018. There were no material changes to those risk factors during the nine months ended June 30, 2019, except that the first risk factor is hereby added and the remaining risk factors are hereby amended and restated in their entirety as follows:

Our investments in certain tax-advantaged projects may not generate returns as anticipated and may have an adverse impact on our results of operations.

We invest in certain tax-advantaged investments that support renewable energy resources. Our investments in these projects are designed to generate a return in part through the realization of federal and state income tax credits, and other tax benefits, over specified time periods. We are subject to the risk that previously recorded tax credits, which remain subject to recapture by taxing authorities based on compliance features required to be met at the project level, may fail to meet certain government compliance requirements and may not be able to be realized. For example, as previously disclosed, we previously recognized $7.9 million of investment tax credits between fiscal year 2017 and 2018 associated with the MSGs subject to the transactions with the DC Solar entities. We are aware that the DC Solar entities, including their principals, are subjects of ongoing federal investigations involving allegations of fraudulent misconduct. While we continue to gather information about the situation, there can be no assurances that such tax credits will not be subject to recapture in the future. See Note 3. Acquisitions to the Condensed Consolidated Financial Statements included herein for further information regarding the transactions with these DC Solar entities and related matters.

The risk of not being able to realize, or of subsequently incurring a recapture of, the tax credits and other tax benefits depends on various factors, some of which are outside our control, including changes in the applicable tax code, as well as the continued economic viability of the project and project operator.  Further, while we engage in due diligence review both prior to the initial investment and on an ongoing basis, our due diligence review may not identify relevant issues or risks that may adversely impact our ability to realize these tax credits or other tax benefits. The possible inability to realize these tax credits and other tax benefits may have a negative impact on our financial results.

We incur significant costs and demands upon management and accounting and finance resources as a result of complying with the laws and regulations affecting public companies; if we fail to maintain proper and effective internal controls, our ability to produce accurate and timely financial statements could be impaired, which could harm our operating results, our ability to operate our business and our reputation.

As an SEC reporting company, we are required to, among other things, maintain a system of effective internal control over financial reporting, which requires annual management and independent registered public accounting firm assessments of the effectiveness of our internal controls. Ensuring that we have adequate internal financial and accounting controls and procedures in place so that we can produce accurate financial statements on a timely basis is a costly and time-consuming effort that needs to be re-evaluated frequently. We have historically dedicated a significant amount of time and resources to implement our internal financial and accounting controls and procedures. Substantial work may continue to be required to further implement, document, assess, test, and, if necessary, remediate our system of internal controls. We may also need to retain additional finance and accounting personnel in the future.

Control failures, including failures in our controls over financial reporting, could result from human error, fraud, breakdowns in information and computer systems, lapses in operating processes, or natural or man-made disasters. If a significant control failure or business interruption were to occur, it could materially damage our financial condition and results of operations. We may not be able to foresee, prevent, mitigate, reverse, or repair the negative effects of such failures or interruptions.

68

Moreover, we rely heavily upon information systems and other operating technologies to conduct and manage our business. To the extent that our technology fails to keep up with our changing environment, we may be unable to conduct and manage our business effectively. Any technical failure or interruption could harm our risk management and profitability and could adversely impact our financial condition and results of operations.

We identified control deficiencies in our internal controls over financial reporting related to the Crestmark division's information technology control environment. Specifically, these control deficiencies were in the areas of user access to applications used by the Crestmark division and lack of completeness of certain review procedures with respect to such user access. These control deficiencies were evaluated, both individually and in the aggregate, and management identified the aggregation of these deficiencies as a material weakness in our internal controls, as described more fully in “Item 4. Controls and Procedures” of Part I of this quarterly report. These control deficiencies could result in a misstatement of any of our financial statement accounts and disclosures that, in turn, could result in a material misstatement of our annual or interim final statements that may not be prevented or detected. In addition, other control deficiencies of this or a similar nature may be identified in the future.

If we are unable to correct the material weakness or deficiencies in internal controls over financial reporting in a timely manner or if future instances of an ineffective control environment exist, our ability to record, process, summarize and report financial information accurately and within the time periods specified in the rules and forms of the SEC could be adversely affected, and we may be unable to comply with the periodic reporting requirements of the SEC. This failure, which could cause our investors to lose confidence in our reported financial information, could subject us to investigation and sanction by the SEC or other regulatory authorities and to claims by stockholders, which could impose significant additional costs on us, divert our management's attention and generally, materially, and adversely impact our business and financial condition. Additionally, our common stock listing on the NASDAQ Global Select Market could be suspended or terminated, and our stock price could materially suffer. See also Item 4. Controls and Procedures in Part I of this quarterly report.

Crestmark’s business presents a heightened degree of operational and credit risks to the Bank.

Crestmark’s focus on asset-based loans and other forms of commercial financing subjects Crestmark and, therefore, the Bank to the potential for fraud by borrowers regarding the value of underlying collateral. As a result, the Bank may assume different or greater lending risks than other commercial lenders in connection with the commercial products and services offered through the Crestmark division. Even routine funding transactions expose the Bank to credit risk in the event of default of its counterparty or client. In addition, credit risk related to products and services offered by the Crestmark division may be exacerbated when the collateral held by the Bank cannot be realized upon or is liquidated at prices insufficient to recover the full amount due under the financial instrument. Lastly, the use of and reliance on information systems specific to Crestmark’s business increases the operational risk of this recently acquired business. We define operational risk as the risk arising from inadequate or failed processes, people, and/or systems, including those emanating from external sources. While operational risk is inherent in all of our business activities, processes, and systems, the operational risk of the Crestmark division is elevated due to the material weakness identified during the quarter ended June 30, 2019, which is described in Item 4. Controls and Procedures in Part I of this quarterly report.

69

Item 2. Unregistered Sales of Securities and Use of Proceeds.

(a) None

(b) None

(c) Issuer Purchases of Equity Securities

Meta's Board of Directors authorized a 2,000,000 share repurchase program that is scheduled to expire on September 30, 2021. The share repurchase program was announced on March 26, 2019 and became effective on May 1, 2019. The table below sets forth information regarding repurchases of our common stock during the third fiscal quarter of 2019.

Period	Total Number of Shares Repurchased(1)	Average Price Paid per Share(1)(2)		Total Number of Shares Repurchased as Part of Publicly Announced Plans or Programs	Maximum Number of Shares that may yet be Repurchased Under the Program
April 1 to 30	—	$	—	—	—
May 1 to 31	820,251	26.80		820,098	1,179,902
June 1 to 30	754,972	27.73		754,636	425,266
Total	1,575,223			1,574,734

⁽¹⁾ These columns also reflect shares acquired in satisfaction of the tax withholding obligations of holders of restricted stock unit awards, which vested during the quarter, and shares repurchased pursuant to Rule 10b5-1 under the Securities Exchange Act of 1934.

⁽²⁾ The average price paid per share is calculated on a trade date basis for all open market transactions and excludes commissions and other transaction expenses.

Item 6. Exhibits.

Exhibit Number	Description
31.1	Section 302 certification of Chief Executive Officer.
31.2	Section 302 certification of Chief Financial Officer.
32.1	Section 906 certification of Chief Executive Officer.
32.2	Section 906 certification of Chief Financial Officer.
101.INS	Instance Document
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document

70

META FINANCIAL GROUP, INC.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	META FINANCIAL GROUP, INC.
Date: August 7, 2019	By:	/s/ Bradley C. Hanson
		Bradley C. Hanson,
		President, Chief Executive Officer and Director
Date: August 7, 2019	By:	/s/ Glen W. Herrick
		Glen W. Herrick, Executive Vice President
		and Chief Financial Officer

71

EX-31.1

Exhibit 31.1

CERTIFICATION PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Bradley C. Hanson, certify that:

1.    I have reviewed this quarterly report on Form 10-Q of Meta Financial Group, Inc.;

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.    The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)    Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)    Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)    Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)    Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report), that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.    The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)    All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)    Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 7, 2019	/s/ Bradley C. Hanson
	President and Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Glen W. Herrick, certify that:

1.    I have reviewed this quarterly report on Form 10-Q of Meta Financial Group, Inc.;

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.    The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)    Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)    Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)    Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)    Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report), that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.    The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)    All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)    Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 7, 2019	/s/ Glen W. Herrick
	Executive Vice President and Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Meta Financial Group, Inc. (the “Company”) for the quarterly period ended June 30, 2019 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Bradley C. Hanson, the Chief Executive Officer of the Company, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)    the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)    the information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

By:/s/ Bradley C. Hanson

Name: Bradley C. Hanson

President and Chief Executive Officer

August 7, 2019

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Meta Financial Group, Inc. (the “Company”) for the quarterly period ended June 30, 2019 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Glen W. Herrick, Chief Financial Officer of the Company, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)    the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)    the information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

By:/s/ Glen W. Herrick

Name: Glen W. Herrick

Executive Vice President and Chief Financial Officer

August 7, 2019

XML

Cover Page - shares	9 Months Ended
	Jun. 30, 2019	Aug. 02, 2019
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2019
Document Transition Report	false
Entity File Number	0-22140
Entity Registrant Name	META FINANCIAL GROUP INC
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	42-1406262
Entity Address, Address Line One	5501 South Broadband Lane
Entity Address, City or Town	Sioux Falls
Entity Address, State or Province	SD
Entity Address, Postal Zip Code	57108
City Area Code	605
Local Phone Number	782-1767
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Title of 12(b) Security	Common Stock, $.01 par value
Trading Symbol	CASH
Security Exchange Name	NASDAQ
Entity Common Stock, Shares Outstanding		37,879,833
Entity Central Index Key	0000907471
Current Fiscal Year End Date	--09-30
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q3
Amendment Flag	false

XML

Condensed Consolidated Statements of Financial Condition (Unaudited) - USD ($) $ in Thousands	Jun. 30, 2019	Sep. 30, 2018
ASSETS
Cash and cash equivalents	$ 100,732	$ 99,977
Investment securities available for sale, at fair value	961,897	1,484,160
Mortgage-backed securities available for sale, at fair value	395,201	364,065
Investment securities held to maturity, at cost	138,128	163,893
Mortgage-backed securities held to maturity, at cost	7,414	7,850
Loans held for sale	62,839	15,606
Loans and leases	3,631,031	2,944,739
Allowance for loan and lease losses	(43,505)	(13,040)
Federal Home Loan Bank Stock, at cost	17,236	23,400
Accrued interest receivable	19,722	22,016
Premises, furniture, and equipment, net	46,360	40,458
Rental equipment, net	184,732	107,290
Bank-owned life insurance	89,193	87,293
Foreclosed real estate and repossessed assets	29,514	31,638
Goodwill	307,941	303,270
Intangible assets	56,153	70,719
Prepaid assets	22,023	27,906
Deferred taxes	21,630	18,737
Other assets	52,831	35,090
Total assets	6,101,072	5,835,067
LIABILITIES
Noninterest-bearing checking	2,751,931	2,405,274
Interest-bearing checking	157,802	111,587
Savings deposits	52,179	54,765
Money market deposits	68,604	51,995
Time certificates of deposit	116,698	276,180
Wholesale deposits	1,628,000	1,531,186
Total deposits	4,775,214	4,430,987
Short-term borrowings	146,613	425,759
Long-term borrowings	209,765	88,963
Accrued interest payable	12,350	7,794
Accrued expenses and other liabilities	134,229	133,838
Total liabilities	5,278,171	5,087,341
STOCKHOLDERS’ EQUITY
Preferred stock, 3,000,000 shares authorized, no shares issued or outstanding at June 30, 2019 and September 30, 2018, respectively	0	0
Additional paid-in capital	578,715	565,811
Retained earnings	238,004	213,048
Accumulated other comprehensive income (loss)	2,308	(33,111)
Treasury stock, at cost, 489 and 24,783 common shares at June 30, 2019 and September 30, 2018, respectively	(13)	(1,989)
Total equity attributable to parent	819,393	744,152
Noncontrolling interest	3,508	3,574
Total stockholders’ equity	822,901	747,726
Total liabilities and stockholders’ equity	6,101,072	5,835,067
Common stock, $.01 par value; 90,000,000 and 90,000,000 shares authorized, 37,878,694 and 39,192,063 shares issued, 37,878,205 and 39,167,280 shares outstanding at June 30, 2019 and September 30, 2018, respectively
STOCKHOLDERS’ EQUITY
Common stock	379	393
Common stock, Nonvoting, $.01 par value; 3,000,000 shares authorized, no shares issued or outstanding at June 30, 2019 and September 30, 2018, respectively
STOCKHOLDERS’ EQUITY
Common stock	$ 0	$ 0

XML

Condensed Consolidated Statements of Financial Condition (Unaudited) (Parenthetical) - $ / shares	Jun. 30, 2019	Sep. 30, 2018
STOCKHOLDERS’ EQUITY
Preferred stock, shares authorized (in shares)	3,000,000	3,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common Stock
STOCKHOLDERS’ EQUITY
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	90,000,000	90,000,000
Common stock, shares issued (in shares)	37,878,694	39,192,063
Common stock, shares outstanding (in shares)	37,878,205	39,167,280
Common Stock, Nonvoting
STOCKHOLDERS’ EQUITY
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	3,000,000	3,000,000
Common stock, shares issued (in shares)	0	0
Common stock, shares outstanding (in shares)	0	0
Treasury stock (in shares)	489	24,783

XML

Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
		Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Interest and dividend income:
Loans and leases, including fees		$ 69,732	$ 19,056	$ 203,900	$ 53,344
Mortgage-backed securities		3,063	3,950	8,622	11,755
Other investments		8,837	11,098	32,380	33,234
Total interest and dividend income		81,632	34,104	244,902	98,333
Interest expense:
Deposits		10,395	2,264	35,731	7,106
FHLB advances and other borrowings		4,269	3,429	10,581	9,215
Total interest expense		14,664	5,693	46,312	16,321
Net interest income		66,968	28,411	198,590	82,012
Provision for loan and lease losses		9,112	5,315	51,529	24,726
Net interest income after provision for loan and lease losses		57,856	23,096	147,061	57,286
Noninterest income:
Bank-owned life insurance		628	633	1,901	1,952
Gain (loss) on sale of securities available-for-sale, net (Includes $440 and ($22) reclassified from accumulated other comprehensive income (loss) for net gains (losses) on available for sale securities for the three months ended June 30, 2019 and 2018, respectively and $649 and ($1,198) for the nine months ended June 30, 2019 and 2018, respectively)		440	(22)	649	(1,198)
Gain on sale of loans and leases		1,913	0	3,865	0
Loss on foreclosed real estate		0	0	(185)	(19)
Other income		1,808	250	5,363	766
Total noninterest income		43,790	33,225	186,565	159,912
Noninterest expense:
Compensation and benefits		35,176	24,439	117,350	78,951
Refund transfer product expense		287	1,694	7,478	11,665
Tax advance product expense		425	(19)	3,101	1,736
Card processing		4,613	7,068	18,670	20,798
Occupancy and equipment		7,136	4,720	20,806	14,087
Operating lease equipment depreciation		6,029	0	18,280	0
Legal and consulting		4,065	2,781	12,341	8,436
Marketing		368	416	1,493	1,637
Data processing		260	301	1,018	958
Intangible amortization		4,374	1,664	14,352	6,077
Impairment expense		0	0	9,660	0
Other expense		9,735	5,988	32,467	17,247
Total noninterest expense		72,468	49,053	257,016	161,592
Income before income tax expense		29,178	7,268	76,610	55,606
Income tax (benefit) expense (Includes $110 and ($6) reclassified from accumulated other comprehensive loss for the three months ended June 30, 2019 and 2018, respectively and $162 and ($335) for the nine months ended June 30, 2019 and 2018, respectively)		(1,158)	476	(3,244)	12,708
Net income before noncontrolling interest		30,336	6,792	79,854	42,898
Net income attributable to noncontrolling interest		1,045	0	3,045	0
Net income attributable to parent		$ 29,291	$ 6,792	$ 76,809	$ 42,898
Earnings per common share
Basic (in dollars per share)	[1]	$ 0.75	$ 0.23	$ 1.96	$ 1.48
Diluted (in dollars per share)	[1]	$ 0.75	$ 0.23	$ 1.95	$ 1.47
Refund transfer product fees
Noninterest income:
Revenue from contract with customer		$ 6,697	$ 7,358	$ 38,559	$ 41,353
Tax advance product fees
Noninterest income:
Revenue from contract with customer		34	(46)	34,757	35,739
Card fees
Noninterest income:
Revenue from contract with customer		19,537	22,807	61,939	74,910
Rental income
Noninterest income:
Revenue from contract with customer		9,386	0	30,167	0
Total noninterest income		9,386	0	30,167	0
Loan and lease fees
Noninterest income:
Revenue from contract with customer		1,012	1,111	3,185	3,445
Deposit fees
Noninterest income:
Revenue from contract with customer		$ 2,335	$ 1,134	$ 6,365	$ 2,964

[1] All share and per share data has been adjusted to reflect the 3-for-1 forward stock split effected by the Company on October 4, 2018.

XML

Condensed Consolidated Statements of Operations (Unaudited) (Parenthetical) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Noninterest income:
Net gain (losses) on available for sale securities reclassified from accumulated other comprehensive income (loss)	$ 440	$ (22)	$ 649	$ (1,198)
Income tax expense (benefit) reclassified from accumulated other comprehensive income (loss)	$ 110	$ (6)	$ 162	$ (335)

XML

Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Statement of Comprehensive Income [Abstract]
Net income before noncontrolling interest	$ 30,336	$ 6,792	$ 79,854	$ 42,898
Other comprehensive income (loss):
Change in net unrealized gain (loss) on debt securities	16,897	(9,905)	48,157	(53,377)
(Gain) loss realized in net income	(440)	22	(649)	1,198
Total	16,457	(9,883)	47,508	(52,179)
Unrealized gain (loss) on currency translation	221	0	(24)	0
Deferred income tax effect	4,106	(2,447)	11,590	(14,412)
Total other comprehensive income (loss)	12,572	(7,436)	35,894	(37,767)
Total comprehensive income (loss)	42,908	(644)	115,748	5,131
Total comprehensive income attributable to noncontrolling interest	1,045	0	3,045	0
Comprehensive income (loss) attributable to parent	$ 41,863	$ (644)	$ 112,703	$ 5,131

XML

Condensed Consolidated Statements of Changes in Stockholders' Equity (Unaudited) - USD ($) $ in Thousands	Total	Parent [Member]	Common Stock	Additional Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive Income (Loss)	Treasury Stock	Noncontrolling Interest
Beginning Balance at Sep. 30, 2017	$ 434,496	$ 434,496	$ 288	$ 258,144	$ 167,164	$ 9,166	$ (266)	$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Cash dividends declared on common stock	(3,778)	(3,778)			(3,778)
Issuance of common shares due to exercise of stock options	147	147		147
Issuance of common shares due to restricted stock	2	2	2
Issuance of common shares due to ESOP	1,606	1,606	1	1,605
Share repurchases	(2,131)	(2,131)		(726)			(1,405)
Stock compensation	8,440	8,440		8,440
Total other comprehensive income	(37,767)	(37,767)				(37,767)
Net income	42,898	42,898			42,898
Ending Balance at Jun. 30, 2018	443,913	443,913	291	267,610	206,284	(28,601)	(1,671)	0
Beginning Balance at Mar. 31, 2018	443,703	443,703	291	265,491	200,753	(21,166)	(1,666)	0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Cash dividends declared on common stock	(1,261)	(1,261)			(1,261)
Share repurchases	(5)	(5)		0			(5)
Stock compensation	2,119	2,119		2,119
Total other comprehensive income	(7,435)	(7,435)				(7,435)
Net income	6,792	6,792			6,792
Ending Balance at Jun. 30, 2018	443,913	443,913	291	267,610	206,284	(28,601)	(1,671)	0
Beginning Balance at Sep. 30, 2018	747,726	744,152	393	565,811	213,048	(33,111)	(1,989)	3,574
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Cash dividends declared on common stock	(5,874)	(5,874)			(5,874)
Issuance of common shares due to exercise of stock options	92	92		92
Issuance of common shares due to restricted stock	3	3	3
Issuance of common shares due to ESOP	2,010	2,010		2,010
Share repurchases	(45,980)	(45,980)	(17)	17	(43,000)		(2,980)
Stock compensation	10,785	10,785		10,785
Total other comprehensive income	35,894	35,894				35,894
Net income	79,854	76,809			76,809			3,045
Net investment by (distribution to) noncontrolling interests	(3,111)							(3,111)
Ending Balance at Jun. 30, 2019	822,901	819,393	379	578,715	238,004	2,308	(13)	3,508
Beginning Balance at Mar. 31, 2019	823,709	820,181	395	576,406	258,600	(10,264)	(4,956)	3,528
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Cash dividends declared on common stock	(1,931)	(1,931)			(1,931)
Issuance of common shares due to exercise of stock options	37	37		37
Share repurchases	(43,013)	(43,013)	(16)	16	(43,000)		(13)
Stock repurchased and retired during period					(4,956)		4,956
Stock compensation	2,256	2,256		2,256
Total other comprehensive income	12,572	12,572				12,572
Net income	30,336	29,291			29,291			1,045
Net investment by (distribution to) noncontrolling interests	(1,065)							(1,065)
Ending Balance at Jun. 30, 2019	$ 822,901	$ 819,393	$ 379	$ 578,715	$ 238,004	$ 2,308	$ (13)	$ 3,508

XML

Condensed Consolidated Statements of Changes in Stockholders' Equity (Unaudited) (Parenthetical) - $ / shares		9 Months Ended
		Jun. 30, 2019	Jun. 30, 2018
Statement of Stockholders' Equity [Abstract]
Cash dividends declared on common stock (in dollars per share)	[1]	$ 0.05	$ 0.04

[1] See Notes to Condensed Consolidated Financial Statements. ⁽¹⁾All share and per share data has been adjusted to reflect the 3-for-1 forward stock split effected by the Company on October 4, 2018.

XML

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Jun. 30, 2019	Jun. 30, 2018
Cash flows from operating activities:
Net income	$ 79,854	$ 42,898
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation, amortization and accretion, net	41,290	27,995
Stock compensation	10,785	8,440
Provision (recovery):
Loan and lease losses	51,529	24,726
Deferred taxes	(14,468)	488
Loans held for sale:
Originations	(104,121)	0
Purchases	(12,643)	0
Proceeds from sales	95,663	0
Net change	15,925	0
Fair value adjustment of foreclosed real estate	139	29
Net realized (gain) loss:
Other assets	(54)	(1)
Foreclosed real estate or other assets	185	19
Available for sale securities, net	(649)	1,198
Loans held for sale	(3,650)	0
Leases receivable and rental equipment	(2,598)	0
Net change:
Other assets	(15,957)	577
Accrued interest payable	4,556	1,425
Accrued expenses and other liabilities	18,785	4,879
Accrued interest receivable	2,294	1,555
Change in bank-owned life insurance value	(1,900)	(1,952)
Impairment on rental equipment	6,194	0
Impairment of intangibles	111	0
Net cash provided by operating activities	171,270	112,276
Available for sale securities:
Purchases	(297,548)	(418,699)
Proceeds from sales	720,376	312,863
Proceeds from maturities and principal repayments	110,810	115,878
Held to maturity:
Proceeds from maturities and principal repayments	24,809	29,752
Loans and leases:
Purchases	(219,551)	(95,169)
Proceeds from sales	13,069	19,961
Net change	(530,215)	(238,679)
Proceeds from sales of foreclosed real estate or other assets	1,905	244
Federal Home Loan Bank stock:
Purchases	(606,756)	(713,444)
Redemption	612,920	767,120
Rental equipment:
Purchases	(111,150)	0
Proceeds from sales	6,551	0
Net change	1,868	0
Premises and equipment:
Purchases	(11,944)	(5,176)
Proceeds from sales	101	0
Net cash (used in) investing activities	(284,755)	(225,349)
Cash flows from financing activities:
Checking, savings, and money market deposits	408,951	219,909
Time deposits	(159,611)	(66,486)
Wholesale deposits	96,763	144,786
FHLB and other borrowings	110,000	(415,000)
Federal funds	(287,000)	(963,000)
Securities sold under agreements to repurchase	(36)	754
Net investment by (distribution to) noncontrolling interests	(3,111)	0
Proceeds from other liabilities	7,525
Other liabilities	(9,404)	0
Capital lease obligations	(64)	(46)
Cash dividends paid	(5,874)	(3,778)
Purchase of shares by ESOP	2,010	1,606
Issuance of restricted stock	3	2
Proceeds from exercise of stock options and issuance of common stock	92	147
Shares repurchased	(45,980)	(2,131)
Net cash provided by (used in) financing activities	114,264	(1,083,237)
Effect of exchange rate changes on cash	(24)	0
Net change in cash and cash equivalents	755	(1,196,310)
Cash and cash equivalents at beginning of year	99,977	1,267,586
Cash and cash equivalents at end of year	100,732	71,276
Supplemental disclosure of cash flow information
Interest	19,220	17,746
Income taxes	(247)	8,211
Franchise taxes	184	199
Other taxes	539	129
Supplemental schedule of non-cash investing activities:
Loans and leases to foreclosed real estate or other assets	105	29,922
Loans and leases to rental equipment	229	0
Loans transferred to held for sale	39,452	0
Purchases - Available for sale	1,721	4,117
Securities transferred from held-to-maturity to available-for-sale	0	306,000
Short- and long-term borrowings transferred from other liabilities	$ 20,026	$ 0

XML

BASIS OF PRESENTATION

9 Months Ended

Jun. 30, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

BASIS OF PRESENTATION

BASIS OF PRESENTATION

The interim unaudited Condensed Consolidated Financial Statements contained herein should be read in conjunction with the audited consolidated financial statements and accompanying notes to the consolidated financial statements for the fiscal year ended September 30, 2018 included in Meta Financial Group, Inc.’s (“Meta” or the “Company”) Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on November 29, 2018.  Accordingly, footnote disclosures which would substantially duplicate the disclosures contained in the audited consolidated financial statements have been omitted.

The financial information of the Company included herein has been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial reporting and has been prepared pursuant to the rules and regulations for reporting on Form 10-Q and Rule 10-01 of Regulation S-X.  Such information reflects all adjustments (consisting of normal recurring adjustments) that are, in the opinion of management, necessary for a fair presentation of the financial position and results of operations for the periods presented. The results of the three- and nine-month periods ended June 30, 2019 are not necessarily indicative of the results expected for the fiscal year ending September 30, 2019.

All share and per share data reported in this Form 10-Q has been adjusted to reflect the 3-for-1 forward stock split of the Company's common stock effected by the Company on October 4, 2018.

Certain prior year amounts have been reclassified to conform to the current year financial statement presentation. These changes and reclassifications did not impact previously reported net income or comprehensive income.

Certain amounts in the Recorded Investment table presented in Note 4 to the consolidated financial statements have been restated from what was previously reported as of September 30, 2018 on Form 10-K.

Loan and lease tables have been conformed to be consistent with the Company's updated presentation of its lending portfolio. The new presentation includes expanding the commercial and consumer finance portfolio to present the lending categories that are included in each, presenting the warehouse finance portfolio as its own category, and condensing the community bank loan categories. Warehouse finance loans were previously included in the consumer finance portfolio. All current and prior period numbers are reflective of this new presentation and total loan and lease balances remained unchanged.

XML

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RECENTLY ADOPTED ACCOUNTING STANDARDS UPDATES ("ASU")

9 Months Ended

Jun. 30, 2019

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RECENTLY ADOPTED ACCOUNTING STANDARDS UPDATES (ASU)

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RECENTLY ADOPTED ACCOUNTING STANDARDS UPDATES ("ASU")

Significant accounting policies in effect and disclosed within the Company’s most recent audited consolidated financial statements as of September 30, 2018 remain substantially unchanged with the exception of the policies impacted by the adoption of noted ASUs below.

Adopted ASUs

Revenue Recognition - The Company adopted ASU 2014-09, Revenue from Contracts with Customers (Topic 606), subsequent related Updates (collectively, ASU 2014-09), and ASU 2016-04, Liabilities - Extinguishments of Liabilities (Subtopic 405-20): Recognition of Breakage of Certain Prepaid Stored-Value Products on October 1, 2018. ASU 2014-09 modifies the guidance used to recognize revenue from contracts with customers for transfers of goods or services and transfers of non-financial assets, unless those contracts are within the scope of other guidance. Upon adoption, the Company recorded a cumulative-effect adjustment of $1.5 million to retained earnings, net of tax, due to changes in timing of revenue recognition from breakage of unregistered, unused prepaid cards in the Company’s Meta Payment Systems (MPS) division. Refer to Note 13. Revenue from Contracts with Customers for additional information.

Financial Instruments - The Company adopted ASU 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Liabilities and related Updates (collectively, ASU 2016-01) on October 1, 2018. ASU 2016-01 makes several revisions to Subtopic 825-10, including that ASU 2016-01: (1) requires equity investments to be measured at fair value with changes in fair value recognized in net income, (2) simplifies impairment assessment of equity investments without readily determinable fair value, (3) eliminates requirement to disclose methods and significant assumptions used to estimate fair value of financial instruments measured at amortized cost, (4) requires the use of an exit price notion when measuring fair value of financial instruments for disclosure purposes, and (5) requires separate presentation of financial assets and liabilities by measurement category and form of financial asset on the balance sheet and accompanying notes. Upon adoption, the Company recorded a cumulative-effect adjustment that reclassed $0.5 million, net of tax, from accumulated other comprehensive income to retained earnings, due to the Company’s cumulative change in fair value of equity securities with readily determinable fair value. Refer to Note 6. Securities for additional information.

The Company also adopted the following ASUs on October 1, 2018, none of which had a material impact on the Company’s consolidated financial statements.

– ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments

– ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash

– ASU 2017-01, Clarifying the Definition of a Business

– ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment

– ASU 2017-05, Other Income - Gains and Losses from Derecognition of Non-Financial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and accounting for Partial Sales of Non-Financial Assets

– ASU 2018-07, Compensation - Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting

ASUs to be Adopted

Leases - ASU 2016-02, Leases (Topic 842), and related Updates (collectively Topic 842) will become effective for the Company on October 1, 2019. For lessees, Topic 842 establishes a right-of-use (ROU) model that requires a lessee to recognize a ROU asset and lease liability on the balance sheet for all leases with a term longer than 12 months. Leases will be classified as finance or operating, with such classification affecting the pattern and classification of expense recognition in the income statement. For lessors, the guidance with Topic 842 is largely unchanged from current guidance.

A modified retrospective transition approach is required. An entity may choose to use either (1) the standard’s effective date or (2) the beginning of the earliest comparative period presented in the financial statements, as the date of initial application. The Company expects to adopt Topic 842 using the effective date, October 1, 2019, as the date of initial application. Consequently, financial information will not be updated and disclosures required under Topic 842 will not be provided for dates and periods before October 1, 2019.

FASB has released several updates to Topic 842 through subsequent ASUs, many of which allow for practical expedients in transition. The Company expects to elect the ‘package of practical expedients’, which permits the Company to not reassess under the new standard the Company’s prior conclusions about lease identification, lease classification and initial direct costs. The Company does not expect to elect the use-of-hindsight or the practical expedient pertaining to land easements, with the latter not being applicable to the Company. The new standard also provides practical expedients for a lessee’s and lessor’s ongoing accounting. The Company expects to elect the short-term lease recognition exemption for all leases that qualify.

Management has evaluated the Company’s leasing contracts and activities and is developing methodologies and processes to estimate and account for right-of-use assets and lease liabilities based on the present value of future lease payments. While the recognition of right-of-use assets will increase total consolidated assets as well as the Company’s risk-weighted assets, management does not expect the impact to capital ratios to be material. The adoption of this guidance is not expected to result in a material change to lessee expense recognition. Management expects the changes in lessor accounting to result in earlier recognition of expense due to a narrower definition of initial direct costs and presentation changes on the income statement due to costs excluded from contract consideration that are reimbursed by the lessee, in addition to other operational impacts.

Other Upcoming ASUs - Refer to the Company’s most recently audited consolidated financial statements for the year ended September 30, 2018 for the latest update on other ASUs relevant to the Company and not yet adopted as of June 30, 2019.

XML

ACQUISITIONS

9 Months Ended

Jun. 30, 2019

Business Combinations [Abstract]

ACQUISITIONS

ACQUISITIONS

The Company acquired Crestmark Bancorp, Inc. ("Crestmark") and its bank subsidiary, Crestmark Bank, on August 1, 2018 for a purchase price of $295.8 million paid by issuance of 9,919,512 shares of Meta common stock. The initial accounting for certain liabilities and goodwill were incomplete and the amounts recorded were considered provisional. The Company recognized certain measurement period adjustments, discussed below, as of June 30, 2019. The amount of goodwill recorded remains provisional, as well as the other assets and liabilities noted in the table below. The measurement period remains open for the Crestmark acquisition until August 1, 2019. The following table summarizes the allocation of the purchase price to net assets of Crestmark as of the August 1, 2018 acquisition date.

(Dollars in Thousands)	Estimated fair value as previously reported(a)		Measurement period adjustments			Fair value as adjusted
Rental Equipment	$	98,977	$	(3,355	)	$	95,622
Intangible assets	28,253		(117		)	28,136
Goodwill	204,547		4,671			209,218
Accrued expenses and other liabilities	88,301		1,199			89,500
Net other assets	55,464		—			55,464
Noncontrolling interest	3,167		—			3,167
Purchase price	295,773		—			295,773

^(a) As previously reported in the Company's Annual Report on Form 10-K for the fiscal year ended September 30, 2018

Measurement Period Adjustments and Impairment - DC Solar

The Company previously purchased a portfolio of mobile solar generators ("MSGs") from DC Solar Solutions, Inc. and certain of its affiliates, a relationship in the Company's solar leasing business, and, in turn, leased the MSGs to DC Solar Distribution, Inc., an affiliate of DC Solar Solutions. During the second fiscal quarter of 2019, the Company became aware that the DC Solar entities and their affiliates filed for bankruptcy and the entities, including their principals, are subjects of ongoing federal investigations involving allegations of fraudulent misconduct. The Company had three separate operating leases with DC Solar - two of the transactions were included in the acquired Crestmark balances on August 1, 2018. The third transaction was originated in August 2018 after the Crestmark acquisition date. The Company considered the bankruptcy filing and fraud allegations as new facts and circumstances and concluded the alleged fraud existed at the acquisition date for the acquired DC Solar transactions. As a result, the identified impairment for the acquired DC Solar transactions and other related adjustments were recorded as measurement period adjustments to the acquired assets and liability amounts recognized and were offset through provisional goodwill. The impairment and related adjustments for the DC Solar transaction originated post-acquisition are reflected in current earnings.

The Company has repossessed 173 of the 176 underlying assets and is in the process of performing repairs and general maintenance to the assets where needed to ensure they are in prime condition for re-lease. As of June 30, 2019 the Company is continuing its repossession efforts with respect to the remaining three units. The timing and extent to which the Company will be able to re-lease the underlying assets remains uncertain as the Company is actively marketing the units. The adjustments to goodwill and impairment recognized for the DC Solar events reflect the Company's best estimate of the potential loss incurred, based on the Company's present understanding of the relevant facts. Assumptions utilized in the estimate included recoverability of the MSGs and the Company's ability to re-lease them, contractual rents, and residual values. As new facts and circumstances become available, the Company will assess any remaining exposure with respect to these DC Solar matters to determine whether additional adjustments to goodwill and/or impairment loss are necessary. As long as the required criteria under GAAP are met, the Company will continue to account for adjustments to the acquired DC Solar transactions as adjustments to goodwill until the measurement period closes, which will not extend beyond August 1, 2019. During the fiscal quarter ended March 31, 2019, the Company recognized a net decrease in net income of $6.6 million and a net decrease of $8.5 million in regulatory capital as a result of the DC Solar bankruptcy and ongoing federal investigation. There were no additional adjustments recorded due to the DC Solar events in the three months ended June 30, 2019.

Measurement Period Adjustments - Other

The Company recorded additional measurement period adjustments in the second and third fiscal quarters of 2019 for provisional tax and compensation liabilities assumed through the Crestmark acquisition. The Company obtained additional information about facts and circumstances existing at the Crestmark acquisition date that resulted in an increase to liabilities and goodwill recognized of $2.2 million.

XML

LOANS AND LEASES, NET

9 Months Ended

Jun. 30, 2019

Loans and Leases Receivable Disclosure [Abstract]

LOANS AND LEASES, NET

LOANS AND LEASES, NET

Loan and lease tables have been conformed to be consistent with the Company's updated categorization of its lending portfolio between National Lending and Community Banking.

Loans and leases at June 30, 2019 and September 30, 2018 were as follows:

	June 30, 2019			September 30, 2018
National Lending	(Dollars in Thousands)
Asset based lending	$	615,309		$	477,917
Factoring	320,344			284,221
Lease financing	341,957			265,315
Insurance premium finance	358,772			337,877
SBA/USDA	99,791			59,374
Other commercial finance	99,677			85,145
Commercial finance	1,835,850			1,509,849
Consumer credit products	155,539			80,605
Other consumer finance	164,727			189,756
Consumer finance(1)	320,266			270,361
Tax services	24,410			1,073
Warehouse finance(1)	250,003			65,000
Total National Lending	2,430,529			1,846,283
Community Banking
Commercial real estate and operating	877,412			790,890
Consumer one-to-four family real estate and other	256,853			247,318
Agricultural real estate and operating	61,169			60,498
Total Community Banking	1,195,434			1,098,706
Total gross loans and leases	3,625,963			2,944,989
Allowance for loan and lease losses	(43,505		)	(13,040		)
Net deferred loan origination fees (costs)	5,068			(250		)
Total loans and leases, net(2)	$	3,587,526		$	2,931,699

⁽¹⁾ Warehouse finance loans are presented in their own line. Previously these balances were included with consumer finance loans. Prior period balances have also been adjusted to reflect this change.

⁽²⁾ As of June 30, 2019, the remaining balance of acquired loans and leases from the Crestmark acquisition was $402.4 million and the remaining balances of the credit and interest rate mark discounts related to the acquired loans and leases held for investment were $6.8 million and $3.2 million, respectively, while the remaining balance of the interest rate mark premium related to the acquired loans held for sale was $0.7 million. On August 1, 2018, the Company acquired loans and leases from the Crestmark acquisition totaling $1.06 billion and recorded related credit and interest rate mark discounts of $12.3 million and $6.0 million, respectively.

During the nine months ended June 30, 2019, the Company transferred $39.5 million of consumer credit product loans to held for sale and originated $104.1 million of SBA/USDA and consumer credit product loans as held for sale. The Company sold held for sale loans resulting in proceeds of $95.7 million and gains on sale of $3.7 million during the nine months ended June 30, 2019. During the nine months ended June 30, 2018, the Company did not designate any loans as held for sale or sell any held for sale loans.

Loans purchased and sold by portfolio segment, including participation interests, for the three and nine months ended June 30, 2019 and 2018 were as follows:

	Three Months Ended				Nine Months Ended
	June 30, 2019		June 30, 2018		June 30, 2019		June 30, 2018
Loans Purchased	(Dollars in Thousands)
Loans held for sale	$	6,703	$	—	$	12,643	$	—
Loans held for investment:
Total National Lending	72,737		—		198,328		72,751
Total Community Banking	2,710		6,183		21,223		22,418
Total purchases	82,150		6,183		232,194		95,169
Loans Sold
Loans held for sale	57,661		—		92,565		—
Loans held for investment:
Total Community Banking	2,212		10,379		13,069		19,961
Total sales	$	59,873	$	10,379	$	105,634	$	19,961

The net investment in direct financing and sales-type leases was comprised of the following as of June 30, 2019 and September 30, 2018.

	June 30, 2019			September 30, 2018
	(Dollars in Thousands)
Minimum lease payments receivable	$	388,291		$	301,835
Estimated residual value of leased equipment	12,128			12,406
Unamortized initial direct costs	5,173			1,806
Premium on acquired leases	3			26
Unearned income	(58,450		)	(48,949		)
Net investment in direct financing and sales-type leases	$	347,145		$	267,124

Future minimum lease payments receivable on noncancelable direct financing and sales-type leases were as follows as of June 30, 2019.

	As of June 30, 2019
	(Dollars in thousands)
Remaining in 2019	$	36,473
2020	129,577
2021	104,805
2022	67,262
2023	37,753
2024 and thereafter	12,421
Total	$	388,291

The Company did not record any contingent rental income from sales-type and direct financing leases in the nine months ended June 30, 2019.

Activity in the allowance for loan and lease losses and balances of loans and leases by portfolio segment for each of the three and nine months ended June 30, 2019 and 2018 was as follows:

Allowance for loan and lease losses:	Beginning balance		Provision (recovery) for loan and lease losses			Charge-offs			Recoveries		Ending balance
Three Months Ended June 30, 2019	(Dollars in Thousands)
National Lending
Asset based lending	$	3,499	$	2,685		$	(1,380	)	$	3	$	4,807
Factoring	1,761		2,747			(1,335		)	31		3,204
Lease financing	1,965		(13		)	(736		)	203		1,419
Insurance premium finance	919		201			(275		)	171		1,016
SBA/USDA	474		449			—			—		923
Other commercial finance	525		432			—			—		957
Commercial finance	9,143		6,501			(3,726		)	408		12,326
Consumer credit products	1,314		142			—			—		1,456
Other consumer finance	5,130		1,890			(1,398		)	28		5,650
Consumer finance	6,444		2,032			(1,398		)	28		7,106
Tax services	24,102		914			(9,627		)	36		15,425
Warehouse finance	185		65			—			—		250
Total National Lending	39,874		9,512			(14,751		)	472		35,107
Community Banking
Commercial real estate and operating	6,673		(249		)	—			—		6,424
Consumer one-to-four family real estate and other	958		(65		)	—			—		893
Agricultural real estate and operating	1,167		(86		)	—			—		1,081
Total Community Banking	8,798		(400		)	—			—		8,398
Total	$	48,672	$	9,112		$	(14,751	)	$	472	$	43,505

Allowance for loan and lease losses:	Beginning balance		Provision (recovery) for loan and lease losses			Charge-offs			Recoveries		Ending balance
Nine Months Ended June 30, 2019	(Dollars in Thousands)
National Lending
Asset based lending	$	107	$	6,213		$	(1,642	)	$	129	$	4,807
Factoring	64		5,769			(2,711		)	82		3,204
Lease financing	59		1,529			(2,198		)	2,029		1,419
Insurance premium finance	1,031		2,091			(2,359		)	253		1,016
SBA/USDA	13		910			—			—		923
Other commercial finance	28		929			—			—		957
Commercial finance	1,302		17,441			(8,910		)	2,493		12,326
Consumer credit products	785		671			—			—		1,456
Other consumer finance	2,820		8,249			(5,477		)	58		5,650
Consumer finance	3,605		8,920			(5,477		)	58		7,106
Tax services	—		24,883			(9,670		)	212		15,425
Warehouse finance	65		185			—			—		250
Total National Lending	4,972		51,429			(24,057		)	2,763		35,107
Community Banking
Commercial real estate and operating	6,220		204			—			—		6,424
Consumer one-to-four family real estate and other	632		281			(20		)	—		893
Agricultural real estate and operating	1,216		(385		)	—			250		1,081
Total Community Banking	8,068		100			(20		)	250		8,398
Total	$	13,040	$	51,529		$	(24,077	)	$	3,013	$	43,505

Allowance for loan and lease losses:	Beginning balance		Provision (recovery) for loan and lease losses			Charge-offs			Recoveries		Ending balance
Three Months Ended June 30, 2018	(Dollars in Thousands)
National Lending
Insurance premium finance	$	746	$	304		$	(243	)	$	99	$	906
Other commercial finance	4		8			—			—		12
Commercial finance	750		312			(243		)	99		918
Consumer credit products	—		264			—			—		264
Other consumer finance	—		3,000			—			—		3,000
Consumer finance	—		3,264			—			—		3,264
Tax services	19,573		1,189			(10,507		)	1		10,256
Total National Lending	20,323		4,765			(10,750		)	100		14,438
Community Banking
Commercial real estate and operating	4,100		687			—			—		4,787
Consumer one-to-four family real estate and other	901		(218		)	—			—		683
Agricultural real estate and operating	765		(51		)	—			207		921
Unallocated	989		132			—			—		1,121
Total Community Banking	6,755		550			—			207		7,512
Total	$	27,078	$	5,315		$	(10,750	)	$	307	$	21,950

Allowance for loan and lease losses:	Beginning balance		Provision (recovery) for loan and lease losses			Charge-offs			Recoveries		Ending balance
Nine Months Ended June 30, 2018	(Dollars in Thousands)
National Lending
Insurance premium finance	$	796	$	569		$	(711	)	$	252	$	906
Other commercial finance	4		8			—			—		12
Commercial finance	800		577			(711		)	252		918
Consumer credit products	—		264			—			—		264
Other consumer finance	—		3,000			—			—		3,000
Consumer finance	—		3,264			—			—		3,264
Tax services	5		20,335			(10,507		)	423		10,256
Total National Lending	805		24,176			(11,218		)	675		14,438
Community Banking
Commercial real estate and operating	2,820		1,967			—			—		4,787
Consumer one-to-four family real estate and other	809		(98		)	(31		)	3		683
Agricultural real estate and operating	2,574		(1,914		)	—			261		921
Unallocated	526		595			—			—		1,121
Total Community Banking	6,729		550			(31		)	264		7,512
Total	$	7,534	$	24,726		$	(11,249	)	$	939	$	21,950

The following tables provide details regarding the allowance for loan and lease losses and balance by type of allowance as of June 30, 2019 and September 30, 2018.

	Allowance						Loans and Leases
Recorded Investment	Ending balance: individually evaluated for impairment		Ending balance: collectively evaluated for impairment		Total		Ending balance: individually evaluated for impairment		Ending balance: collectively evaluated for impairment		Total
As of June 30, 2019	(Dollars in Thousands)
National Lending
Asset based lending	$	12	$	4,795	$	4,807	$	8,119	$	607,190	$	615,309
Factoring	255		2,949		3,204		7,795		312,549		320,344
Lease financing	—		1,419		1,419		5,455		336,502		341,957
Insurance premium finance	—		1,016		1,016		—		358,772		358,772
SBA/USDA	—		923		923		1,276		98,515		99,791
Other commercial finance	—		957		957		—		99,677		99,677
Commercial finance	267		12,059		12,326		22,645		1,813,205		1,835,850
Consumer credit products	—		1,456		1,456		—		155,539		155,539
Other consumer finance	—		5,650		5,650		1,039		163,688		164,727
Consumer finance	—		7,106		7,106		1,039		319,227		320,266
Tax services	—		15,425		15,425		—		24,410		24,410
Warehouse finance	—		250		250		—		250,003		250,003
Total National Lending	267		34,840		35,107		23,684		2,406,845		2,430,529
Community Banking
Commercial real estate and operating	—		6,424		6,424		319		877,093		877,412
Consumer one-to-four family real estate and other	—		893		893		290		256,563		256,853
Agricultural real estate and operating	—		1,081		1,081		1,237		59,932		61,169
Total Community Banking	—		8,398		8,398		1,846		1,193,588		1,195,434
Total	$	267	$	43,238	$	43,505	$	25,530	$	3,600,433	$	3,625,963

	Allowance						Loans and Leases
Recorded Investment	Ending balance: individually evaluated for impairment(1)		Ending balance: collectively evaluated for impairment(1)		Total		Ending balance: individually evaluated for impairment		Ending balance: collectively evaluated for impairment		Total
As of September 30, 2018	(Dollars in Thousands)
National Lending
Asset based lending	$	—	$	107	$	107	$	1,404	$	476,513	$	477,917
Factoring	—		64		64		3,331		280,890		284,221
Lease financing	—		59		59		8,877		256,438		265,315
Insurance premium finance	—		1,031		1,031		—		337,877		337,877
SBA/USDA	—		13		13		—		59,374		59,374
Other commercial finance	—		28		28		—		85,145		85,145
Commercial finance	—		1,302		1,302		13,612		1,496,237		1,509,849
Consumer credit products	—		785		785		—		80,605		80,605
Other consumer finance	—		2,820		2,820		—		189,756		189,756
Consumer finance	—		3,605		3,605		—		270,361		270,361
Tax services	—		—		—		—		1,073		1,073
Warehouse finance	—		65		65		—		65,000		65,000
Total National Lending	—		4,972		4,972		13,612		1,832,671		1,846,283
Community Banking
Commercial real estate and operating	—		6,220		6,220		451		790,439		790,890
Consumer one-to-four family real estate and other	—		632		632		94		247,224		247,318
Agricultural real estate and operating	—		1,216		1,216		1,454		59,044		60,498
Total Community Banking	—		8,068		8,068		1,999		1,096,707		1,098,706
Total	$	—	$	13,040	$	13,040	$	15,611	$	2,929,378	$	2,944,989

⁽¹⁾ Balances have been restated from what was previously reported as of September 30, 2018 on the Company's Annual Report on Form 10-K for its fiscal year ended September 30, 2018.

Federal regulations provide for the classification of loans and other assets such as debt and equity securities considered by the Bank's primary regulator, the Office of the Comptroller of the Currency (the “OCC”), to be of lesser quality as “substandard,” “doubtful” or “loss.”  The loan and lease classification and risk rating definitions are as follows:

Pass- A pass asset is of sufficient quality in terms of repayment, collateral and management to preclude a special mention or an adverse rating.

Watch- A watch asset is generally a credit performing well under current terms and conditions but with identifiable weakness meriting additional scrutiny and corrective measures.  Watch is not a regulatory classification but can be used to designate assets that are exhibiting one or more weaknesses that deserve management’s attention.  These assets are of better quality than special mention assets.

Special Mention- Special mention assets are a credit with potential weaknesses deserving management’s close attention and, if left uncorrected, may result in deterioration of the repayment prospects for the asset.  Special mention assets are not adversely classified and do not expose an institution to sufficient risk to warrant adverse classification.  Special mention is a temporary status with aggressive credit management required to garner adequate progress and move to watch or higher.

The adverse classifications are as follows:

Substandard- A substandard asset is inadequately protected by the net worth and/or repayment ability or by a weak collateral position.  Assets so classified will have well-defined weaknesses creating a distinct possibility the Bank will sustain some loss if the weaknesses are not corrected.  Loss potential does not have to exist for an asset to be classified as substandard.

Doubtful- A doubtful asset has weaknesses similar to those classified substandard, with the degree of weakness causing the likely loss of some principal in any reasonable collection effort.  Due to pending factors, the asset’s classification as loss is not yet appropriate.

Loss- A loss asset is considered uncollectible and of such little value that the asset’s continuance on the Bank’s balance sheet is no longer warranted.  This classification does not necessarily mean an asset has no recovery or salvage value leaving room for future collection efforts.

General allowances represent loss allowances which have been established to recognize the inherent risk associated with lending activities, but which, unlike specific allowances, have not been allocated to particular problem assets.  When assets are classified as “loss,” the Company is required either to establish a specific allowance for losses equal to 100% of that portion of the asset so classified or to charge-off such amount.  The Company's determinations as to the classification of its assets and the amount of its valuation allowances are subject to review by its regulatory authorities, which may order the establishment of additional general or specific loss allowances.

The Company recognizes that concentrations of credit may naturally occur and may take the form of a large volume of related loans and leases to an individual, a specific industry, or a geographic location.  Credit concentration is a direct, indirect, or contingent obligation that has a common bond where the aggregate exposure equals or exceeds a certain percentage of the Company’s Tier 1 Capital plus the Allowance for Loan and Lease Losses.

The asset classification of loans and leases at June 30, 2019 and September 30, 2018 were as follows:

Asset Classification	Pass		Watch		Special Mention		Substandard		Total
June 30, 2019	(Dollars in Thousands)
National Lending
Asset based lending	$	539,623	$	—	$	67,567	$	8,119	$	615,309
Factoring	272,589		—		39,960		7,795		320,344
Lease financing	323,539		—		12,963		5,455		341,957
Insurance premium finance	358,772		—		—		—		358,772
SBA/USDA	90,110		—		8,405		1,276		99,791
Other commercial finance	99,108		—		569		—		99,677
Commercial finance	1,683,741		—		129,464		22,645		1,835,850
Consumer credit products	155,539		—		—		—		155,539
Other consumer finance	164,727		—		—		—		164,727
Consumer finance	320,266		—		—		—		320,266
Tax services	24,410		—		—		—		24,410
Warehouse finance	250,003		—		—		—		250,003
Total National Lending	2,278,420		—		129,464		22,645		2,430,529
Community Banking
Commercial real estate and operating	866,255		3,962		3,487		3,708		877,412
Consumer one-to-four family real estate and other	254,959		1,403		462		29		256,853
Agricultural real estate and operating	42,808		4,148		5,615		8,598		61,169
Total Community Banking	1,164,022		9,513		9,564		12,335		1,195,434
Total loans and leases	$	3,442,442	$	9,513	$	139,028	$	34,980	$	3,625,963

Asset Classification	Pass		Watch		Special Mention		Substandard		Total
September 30, 2018	(Dollars in Thousands)
National Lending
Asset based lending	$	418,635	$	—	$	57,877	$	1,405	$	477,917
Factoring	248,246		—		32,644		3,331		284,221
Lease financing	252,487		—		3,951		8,877		265,315
Insurance premium finance	336,296		—		1,581		—		337,877
SBA/USDA	39,093		—		20,281		—		59,374
Other commercial finance	85,145		—		—		—		85,145
Commercial finance	1,379,902		—		116,334		13,613		1,509,849
Consumer credit products	80,605		—		—		—		80,605
Other consumer finance	189,756		—		—		—		189,756
Consumer finance	270,361		—		—		—		270,361
Tax services	1,073		—		—		—		1,073
Warehouse finance	65,000		—		—		—		65,000
Total National Lending	1,716,336		—		116,334		13,613		1,846,283
Community Banking
Commercial real estate and operating	778,445		12,251		194		—		790,890
Consumer one-to-four family real estate and other	246,463		537		239		79		247,318
Agricultural real estate and operating	42,292		2,447		4,872		10,887		60,498
Total Community Banking	1,067,200		15,235		5,305		10,966		1,098,706
Total loans and leases	$	2,783,536	$	15,235	$	121,639	$	24,579	$	2,944,989

National Lending (Commercial Finance, Consumer Finance, Tax Services and Warehouse Finance)

Commercial Finance

The Company's commercial finance product lines include asset-based lending, factoring, leasing, commercial insurance premium finance, and other commercial finance products offered on a nationwide basis. Asset-based lending and factoring primarily service small businesses that are startups, distressed and/or generally that may not otherwise qualify for traditional bank financing. Leasing focuses on providing equipment finance solutions to mid-market companies. These product offerings supplement the asset generation capacity in our community bank and tax services divisions and enhance the overall yield of our loan and lease portfolio, enabling us to earn attractive risk-adjusted net interest margins.

Asset-Based Lending. Through its Crestmark division, the Bank provides asset-based loans secured by short-term assets such as inventory, accounts receivable, and work-in-process. Asset-based loans may also be secured by real estate and equipment. The primary sources of repayment are the operating income of the borrower, the collection of the receivables securing the loan, and/or the sale of the inventory securing the loan. Loans are typically revolving lines of credit with terms of one to three years, whereby the Bank withholds a contingency reserve representing the difference between the amount advanced and the fair value of the invoice amount or other collateral value. Credit risk is managed through advance rates appropriate for the collateral, standardized loan policies, established and authorized credit limits, attentive portfolio management and the use of lock box agreements and similar arrangements that result in the Company receiving and controlling the debtors' cash receipts. The Bank also originates collateralized term loans and notes receivable, with terms ranging from three to 25 years.

Factoring. Through its Crestmark division, the Bank provides factoring lending where clients provide detailed inventory, accounts receivable, and work-in-process reports for lending arrangements. The factoring clients are diversified as to industry and geography. With these loans, the Crestmark division withholds a contingency reserve, which is the difference between the fair value of the invoice amount or other collateral value and the amount advanced. This reserve is withheld for nonpayment of factored receivables, service fees and other adjustments. Credit risk is managed through standardized advance policies, established and authorized credit limits, verification of receivables, attentive portfolio management and the use of lock box agreements and similar arrangements that result in the Company receiving and controlling the client's cash receipts. In addition, clients generally guarantee the payment of purchased accounts receivable.

Lease Financing. Through its Crestmark division, the Bank provides creative, flexible lease solutions for technology, capital equipment and select transportation assets like tractors and trailers. Direct financing leases and sales-type leases substantially transfer the benefits and risks of equipment ownership to the lessee.  The lease may contain provisions that transfer ownership to the lessee at the end of the initial term, contain a bargain purchase option or allow for purchase of the equipment at fair market value.  Residual values are estimated at the inception of the lease.  Lease maturities are generally no greater than 84 months. The focus in this lease financing category is to support middle market companies by providing a variety of financing products to help them meet their business objectives.

Insurance Premium Finance. Through its AFS/IBEX division the Bank provides, on a national basis, short-term, primarily collateralized financing to facilitate the commercial customers’ purchase of insurance for various forms of risk, otherwise known as insurance premium financing. This includes, but is not limited to, policies for commercial property, casualty and liability risk.  Premiums are advanced either directly to the insurance carrier or through an intermediary/broker and repaid by the policyholder with interest during the policy term.  The policyholder generally makes a 20% to 25% down payment to the insurance broker and finances the remainder over nine to 10 months on average.  The down payment is set such that if the policy is canceled, the unearned premium is typically sufficient to cover the loan balance and accrued interest. The AFS/IBEX division markets itself to the insurance community as a competitive option based on service, reputation, competitive terms, cost and ease of operation.

Small Business Administration ("SBA") and United States Department of Agriculture ("USDA"). The Bank originates loans through programs partially guaranteed by the SBA or USDA. These loans are made to small businesses and professionals with what the Bank believes are lower risk characteristics.

Other Commercial Finance. Included in this category of loans are the Company's healthcare receivables loan portfolio primarily comprised of loans to individuals for medical services received. The majority of these loans are guaranteed by the hospital providing the service to the debtor and this guarantee serves to reduce credit risk as the guarantors agree to repurchase severely delinquent loans. Credit risk is minimized on these loans based on the guarantor’s repurchase agreement. This loan category also includes commercial real estate loans to customers of the Crestmark division.

Consumer Finance

Consumer Credit Products. Through the acquisition of Specialty Consumer Services, the Bank acquired a platform that provides a total solution for marketplace lending, including underwriting and loan management in the direct-to-consumer credit business. The acquired platform allows the Bank to provide innovative lending solutions through consumer credit products. The Company designs and structures its credit programs in an effort to insulate the Company from program losses and to potentially increase the liquidity attributes of such lending programs' marketability to potential bank or other purchasers. While each program is different, all contain one or more types of credit enhancements, loss protections, or trigger events. When determining the applicable program enhancement, generally, the Company uses proprietary data provided by the Company’s partner, with respect to such program, supplemented with public data to design and shape appropriate loss curves, as well as implement stresses significantly higher than base to provide protection in changing credit cycles. Credit enhancements are typically built through holding excess program interest and fees in a reserve account to pay program credit losses. Cash flow waterfall positioning allows for losses and Company program principal and interest to be paid, under certain circumstances, before servicing or other program expenses. Trigger events allow programs and originations to be suspended if certain vintage loss limits, during a specific period of time, are triggered or if cumulative loss percentages are triggered. These triggers are designed to allow the Company to address potential issues quickly. Other trigger events in certain programs provide for excess credit or reserve enhancements, which could be beyond excess interest amounts, if certain loss triggers are breached. The Bank applies a reserve for loan losses of approximately 1% on outstanding loan balances within each of the consumer credit product programs.

Through June 30, 2019, the Bank has launched two consumer credit programs. During the second quarter of fiscal 2018, the Bank entered into a three years program agreement with Liberty Lending, LLC ("Liberty Lending") whereby the Bank provides personal loans to Liberty Lending customers. The Bank and Liberty Lending market the program jointly through a wide variety of marketing channels. The loan products under the agreement with Liberty Lending are closed-end installment loans ranging from $3,500 to $45,000 in initial principal amount with durations between 13 months and 60 months.

The Bank entered into an agreement for 3 years with Health Credit Services ("HCS") during the third quarter of fiscal 2018. The Bank approves and originates loans for elective medical procedures for select HCS provider offices throughout the United States. HCS works with its provider partners to market the loans, as well as provide servicing for them. The loan products offered are unsecured, closed-end installment loans with terms between 12 months and 84 months and revolving lines of credit with durations between six months and 60 months.

Other Consumer Finance. The Bank's purchased student loan portfolios are seasoned, floating rate, private portfolios that are serviced by a third-party servicer. The portfolio purchased during the first quarter of fiscal year 2018 is indexed to one-month LIBOR, while the portfolio purchased in the first quarter of fiscal year 2017 is indexed to three-month LIBOR plus various margins. The Company received written notification on June 18, 2018 from ReliaMax Surety Company ("ReliaMax"), the company that provided insurance coverage for the student loan portfolios, which informed policy holders that the South Dakota Division of Insurance filed a petition to have ReliaMax declared insolvent and to adopt a plan of liquidation. An Order of Liquidation was entered on June 27, 2018 by the Sixth Circuit Court in Hughes County, South Dakota, declaring ReliaMax insolvent and appointing the South Dakota Division of Insurance as liquidator to adopt a plan of liquidation. The Company expects to ultimately recover a portion of the unearned premiums, though the Company can provide no assurance as to the timing and amount of any such recovery.

Tax Services

The Bank's tax services division provides short-term taxpayer advance loans. Taxpayers are underwritten to determine eligibility for these unsecured loans. Due to the nature of taxpayer advance loans, it typically takes no more than three e-file cycles (the period of time between scheduled IRS payments) from when the return is accepted by the IRS to collect from the borrower. In the event of default, the Bank has no recourse against the tax consumer. The Bank will charge off the balance of a taxpayer advance loan if there is a balance at the end of the calendar year, or when collection of principal becomes doubtful.

Through its tax services division, the Bank provides short-term electronic return originator ("ERO") advance loans on a nationwide basis. These loans are typically utilized by tax preparers to purchase tax preparation software and to prepare tax office operations for the upcoming tax season. EROs go through an underwriting process to determine eligibility for the unsecured advances. ERO loans are not collateralized. Collection on ERO advances begins once the ERO begins to process refund transfers. Generally, the Bank will charge off the balance of an ERO advance loan if there is a balance at the end of June, or when collection of principal becomes doubtful.

Warehouse Finance

In fiscal 2018, the Bank entered into a first-out participation agreement in a consumer receivable asset-backed warehouse line of credit, with the Bank holding a senior collateral position enhanced by a subordinate party structure. During the first quarter of fiscal 2019, the Bank entered into two additional first-out participation agreements in asset-backed warehouse lines of credit, including consumer loan receivables and small business loan receivables. The senior collateral position of the Bank is supported by a subordinate party position. During the third quarter of fiscal 2019, the Bank entered into a first-out participation agreement in a consumer receivable asset-backed warehouse line of credit, with the Bank holding a senior collateral position enhanced by a subordinate party structure.

Community Banking

Commercial Real Estate and Operating. The Company engages in commercial and multi-family real estate lending in the community bank's primary market areas and surrounding areas. These loans are secured primarily by apartment buildings, office buildings, and hotels.  Commercial and multi-family real estate loans generally are underwritten with terms not exceeding 20 years, have loan-to-value ratios of up to 80% of the appraised value of the property securing the loan, and are typically secured by guarantees of the borrowers.  The Company has a variety of rate adjustment features and other terms in its commercial and multi-family real estate loan portfolio.  Commercial and multi-family real estate loans provide for a margin over a number of different indices.  In underwriting these loans, the Company analyzes the financial condition of the borrower, the borrower’s credit history, and the reliability and predictability of the cash flow generated by the property securing the loan.  Appraisals on properties securing commercial real estate loans originated by the Company are performed by independent appraisers.

The repayment of loans secured by commercial and multi-family real estate is typically dependent upon the successful operation of the related real estate project.  If the cash flow from the project is reduced (for example, if leases are not obtained or renewed, or a bankruptcy court modifies a lease term, or a major tenant is unable to fulfill its lease obligations), the borrower’s ability to repay the loan may be impaired.

The Company originates its community banking commercial operating loans primarily in the community bank's market areas.  Most of these commercial operating loans have been extended to finance local and regional businesses and include short-term loans to finance machinery and equipment purchases, inventory and accounts receivable.  Commercial loans also may involve the extension of revolving credit for a combination of equipment acquisitions and working capital in expanding companies. The maximum term for loans extended on machinery and equipment is based on the projected useful life of such machinery and equipment.  Generally, the maximum term on non-mortgage lines of credit is one year. 

The Company’s commercial operating lending policy includes credit file documentation and analysis of the borrower’s management ability, capacity to repay the loan, the adequacy of the borrower’s capital and collateral as well as an evaluation of conditions affecting the borrower.  Analysis of the borrower’s past, present and future cash flows is also an important aspect of the Company’s current credit analysis. Commercial operating loans typically are made on the basis of the borrower’s ability to make repayment from the cash flow of the borrower’s business.  As a result, the availability of funds for the repayment of commercial operating loans may be substantially dependent on the success of the business itself (which, in turn, is likely to be dependent upon the general economic environment).  The Company’s commercial operating loans are usually secured by business assets and personal guarantees.  However, the collateral securing the loans may depreciate over time, may be difficult to appraise and may fluctuate in value based on the success of the business.

Consumer One-to-Four Family Real Estate and Other. One-to-four family real estate loan originations are typically generated by the Company’s marketing efforts, its present customers, walk-in customers and referrals. The Company offers fixed-rate loans and adjustable-rate mortgage ("ARM") loans for both permanent structures and those under construction. The Company’s one-to-four family real estate loan originations are secured primarily by properties located in the community bank's primary market areas and surrounding areas.

The Company originates one-to-four family real estate loans with terms up to a maximum of 30 years and with loan-to-value ratios up to 100% of the lesser of the appraised value of the property securing the loan or the contract price. However, the vast majority of these loans are originated with loan-to-value ratios below 80%. The Company generally requires that private mortgage insurance be obtained in an amount sufficient to reduce the Company’s exposure to at or below the 80% loan‑to‑value level. Due to consumer demand, the Company also offers fixed-rate mortgage loans with terms up to 30 years, which may conform to secondary market standards such as those imposed by Fannie Mae, Ginnie Mae, and Freddie Mac. The Company typically holds all fixed-rate mortgage loans and does not engage in secondary market sales. The Company also offers ARM loans with terms up to five years and ten years.

In underwriting one-to-four family real estate loans, the Company evaluates both the borrower’s ability to make monthly payments and the value of the property securing the loan.  Properties securing real estate loans made by the Company are appraised by independent appraisers approved by the Board of Directors of the Company.  The Company generally requires borrowers to obtain an attorney’s title opinion or title insurance, as well as fire and property insurance (including flood insurance, if necessary) in an amount not less than the amount of the loan.  Real estate loans originated by the Company generally contain a “due on sale” clause that allows the Company to declare the unpaid principal balance due and payable upon the sale of the security property.  The Company has not engaged in sub-prime residential mortgage originations.

The Company originates a variety of secured consumer loans, including home equity, home improvement, automobile and boat loans, as well as loans secured by savings deposits in its primary market areas and surrounding areas. Substantially all of the Company’s home equity loans and lines of credit are secured by second mortgages on principal residences.  The Bank will lend amounts that, together with all prior liens, may be up to 90% of the appraised value of the property securing the loan.  Home equity loans and lines of credit generally have maximum terms of five years.

Consumer loan terms vary according to the type and value of collateral, length of contract and creditworthiness of the borrower.  The underwriting standards employed by the Bank for consumer loans include an application, a determination of the applicant’s payment history on other debts and an assessment of ability to meet existing obligations and payments on the proposed loan.  Although creditworthiness of the applicant is a primary consideration, the underwriting process also may include a comparison of the value of the security, if any, in relation to the proposed loan amount.

Agricultural Real Estate and Operating. The Company originates loans to finance the purchase of farmland, livestock, farm machinery and equipment, seed, fertilizer, and other farm-related products, primarily in its market areas. Agricultural operating loans are originated at either an adjustable- or fixed-rate of interest for up to a 1 year term or, in the case of livestock, are due upon sale. Agricultural real estate loans are frequently originated with adjustable rates of interest.  Generally, such loans provide for a fixed rate of interest for the first 5 years to 10 years, after which the loan will balloon or the interest rate will adjust annually. These loans generally amortize over a period of 20 to 25 years. Fixed-rate agricultural real estate loans typically have terms up to 10 years. Agricultural real estate loans are generally limited to 75% of the value of the property securing the loan.

Payments on loans are dependent on the successful operation or management of the farm property securing the loan or for which an operating loan is utilized. The success of the loan may also be affected by many factors outside the control of the borrower such as weather, government support programs and grain and livestock prices. These risks may be reduced, by the farmer, with the use of crop insurance coverage and futures contracts or options to mitigate price risk, both of which the Company frequently requires of the borrowers to help ensure loan repayment. Many farms are also dependent on a limited number of key individuals whose injury or death may result in an inability to successfully operate the farm.

Past due loans and leases at June 30, 2019 and September 30, 2018 were as follows:

	Accruing and Non-accruing Loans and Leases												Non-performing Loans and Leases
Past Due Loans and Leases	30-59 Days Past Due		60-89 Days Past Due		> 89 Days Past Due		Total Past Due		Current		Total Loans and Leases Receivable		> 89 Days Past Due and Accruing		Non-accrual balance		Total
June 30, 2019	(Dollars in Thousands)
National Lending
Asset based lending	$	1,701	$	428	$	2,890	$	5,019	$	610,290	$	615,309	$	180	$	5,654	$	5,834
Factoring	—		—		20		20		320,324		320,344		—		4,846		4,846
Lease financing	2,080		1,816		5,408		9,304		332,653		341,957		4,225		1,936		6,161
Insurance premium finance	2,233		1,081		1,679		4,993		353,779		358,772		1,679		—		1,679
SBA/USDA	85		—		259		344		99,447		99,791		—		259		259
Other commercial finance	—		—		—		—		99,677		99,677		—		—		—
Commercial finance	6,099		3,325		10,256		19,680		1,816,170		1,835,850		6,084		12,695		18,779
Consumer credit products	1,454		1,039		703		3,196		152,343		155,539		703		—		703
Other consumer finance	996		614		1,083		2,693		162,034		164,727		1,083		—		1,083
Consumer finance	2,450		1,653		1,786		5,889		314,377		320,266		1,786		—		1,786
Tax services	—		24,410		—		24,410		—		24,410		—		—		—
Warehouse finance	—		—		—		—		250,003		250,003		—		—		—
Total National Lending	8,549		29,388		12,042		49,979		2,380,550		2,430,529		7,870		12,695		20,565
Community Banking
Commercial real estate and operating	—		—		—		—		877,412		877,412		—		—		—
Consumer one-to-four family real estate and other	54		36		233		323		256,530		256,853		—		233		233
Agricultural real estate and operating	1,745		—		—		1,745		59,424		61,169		—		—		—
Total Community Banking	1,799		36		233		2,068		1,193,366		1,195,434		—		233		233
Total Loans and Leases	$	10,348	$	29,424	$	12,275	$	52,047	$	3,573,916	$	3,625,963	$	7,870	$	12,928	$	20,798

	Accruing and Non-accruing Loans and Leases												Non-performing Loans and Leases
Past Due Loans and Leases	30-59 Days Past Due		60-89 Days Past Due		> 89 Days Past Due		Total Past Due		Current		Total Loans and Leases Receivable		> 89 Days Past Due and Accruing		Non-accrual balance		Total
September 30, 2018	(Dollars in Thousands)
National Lending
Asset based lending	$	1,235	$	2,151	$	94	$	3,480	$	474,437	$	477,917	$	94	$	—	$	94
Factoring	—		—		—		—		284,221		284,221		—		—		—
Lease financing	16,542		532		2,921		19,995		245,320		265,315		726		2,864		3,590
Insurance premium finance	1,864		1,019		2,981		5,864		332,013		337,877		2,981		—		2,981
SBA/USDA	1,067		—		—		1,067		58,307		59,374		—		—		—
Other commercial finance	—		—		—		—		85,145		85,145		—		—		—
Commercial finance	20,708		3,702		5,996		30,406		1,479,443		1,509,849		3,801		2,864		6,665
Consumer credit products	532		284		147		963		79,642		80,605		147		—		147
Other consumer finance	2,677		1,311		2,237		6,225		183,531		189,756		2,237		—		2,237
Consumer finance	3,209		1,595		2,384		7,188		263,173		270,361		2,384		—		2,384
Tax services	—		—		1,073		1,073		—		1,073		1,073		—		1,073
Warehouse finance	—		—		—		—		65,000		65,000		—		—		—
Total National Lending	23,917		5,297		9,453		38,667		1,807,616		1,846,283		7,258		2,864		10,122
Community Banking
Commercial real estate and operating	—		—		—		—		790,890		790,890		—		—		—
Consumer one-to-four family real estate and other	105		—		79		184		247,134		247,318		79		—		79
Agricultural real estate and operating	—		—		—		—		60,498		60,498		—		—		—
Total Community Banking	105		—		79		184		1,098,522		1,098,706		79		—		79
Total Loans and Leases	$	24,022	$	5,297	$	9,532	$	38,851	$	2,906,138	$	2,944,989	$	7,337	$	2,864	$	10,201

Certain loans and leases 89 days or more past due as to interest or principal continue to accrue because they are (1) well-secured and in the process of collection or (2) one-to-four family real estate loans or consumer loans exempt under regulatory rules from being classified as non-accrual until later delinquency, usually 120 days past due.

When analysis of borrower or lessee operating results and financial condition indicates that underlying cash flows of the borrower’s business are not adequate to meet its debt service requirements, the loan or lease is evaluated for impairment.  Often, this is associated with a delay or shortfall in scheduled payments, as described above.

Impaired loans and leases at June 30, 2019 and September 30, 2018 were as follows:

June 30, 2019	Recorded Balance		Unpaid Principal Balance		Specific Allowance
Loans and leases without a specific valuation allowance	(Dollars in Thousands)
National Lending
Asset based lending	$	8,024	$	9,362	$	—
Factoring	3,580		4,655		—
Lease financing	5,455		5,455		—
SBA/USDA	1,276		1,276		—
Commercial finance	18,335		20,748		—
Other consumer finance	1,039		1,089		—
Consumer finance	1,039		1,089		—
Total National Lending	19,374		21,837		—
Community Banking
Commercial real estate and operating	319		319		—
Consumer one-to-four family real estate and other	290		290		—
Agricultural real estate and operating	1,237		1,237		—
Total Community Banking	1,846		1,846		—
Total	$	21,220	$	23,683	$	—
Loans and leases with a specific valuation allowance
National Lending
Asset based lending	$	95	$	107	$	12
Factoring	4,215		5,555		255
Commercial finance	4,310		5,662		267
Total National Lending	4,310		5,662		267
Total	$	4,310	$	5,662	$	267

September 30, 2018	Recorded Balance		Unpaid Principal Balance		Specific Allowance
Loans and leases without a specific valuation allowance	(Dollars in Thousands)
National Lending
Asset based lending	$	1,325	$	1,325	$	—
Factoring	1,383		1,713		—
Lease financing	5,491		5,491		—
Commercial finance	8,199		8,529		—
Total National Lending	8,199		8,529		—
Community Banking
Commercial real estate and operating	405		405		—
Consumer one-to-four family real estate and other	140		140		—
Agricultural real estate and operating	1,454		1,454		—
Total Community Banking	1,999		1,999		—
Total	$	10,198	$	10,528	$	—
Loans and leases with a specific valuation allowance
National Lending
Asset based lending	$	79	$	79	$	22
Factoring	1,948		2,198		49
Lease financing	3,386		3,386		517
Commercial finance	5,413		5,663		588
Total National Lending	5,413		5,663		588
Total	$	5,413	$	5,663	$	588

The following table provides the average recorded investment in impaired loans and leases for the three- and nine-month periods ended June 30, 2019 and 2018.

Three Months Ended June 30,	2019				2018
	Average Recorded Investment		Recognized Interest Income		Average Recorded Investment		Recognized Interest Income
	(Dollars in Thousands)
National Lending
Asset based lending	$	6,683	$	88	$	—	$	—
Factoring	6,621		—		—		—
Lease financing	3,351		—		—		—
SBA/USDA	425		—		—		—
Commercial finance	17,080		88		—		—
Other consumer finance	1,190		28		—		—
Consumer finance	1,190		28		—		—
Total National Lending	18,270		116		—		—
Community Banking
Commercial real estate and operating	106		5		604		4
Consumer one-to-four family real estate and other	186		1		342		2
Agricultural real estate and operating	1,226		28		2,670		42
Total Community Banking	1,518		34		3,616		48
Total loans and leases	$	19,788	$	150	$	3,616	$	48

Nine Months Ended June 30,	2019				2018
	Average Recorded Investment		Recognized Interest Income		Average Recorded Investment		Recognized Interest Income
	(Dollars in Thousands)
National Lending
Asset based lending	$	3,993	$	262	$	—	$	—
Factoring	4,178		5		—		—
Lease financing	5,012		17		—		—
SBA/USDA	142		—		—		—
Commercial finance	13,325		284		—		—
Other consumer finance	1,215		38		—		—
Consumer finance	1,215		38		—		—
Total National Lending	14,540		322		—		—
Community Banking
Commercial real estate and operating	259		9		761		14
Consumer one-to-four family real estate and other	154		3		224		11
Agricultural real estate and operating	1,371		63		1,567		106
Total Community Banking	1,784		75		2,552		131
Total loans and leases	$	16,324	$	397	$	2,552	$	131

The Company’s troubled debt restructurings ("TDRs") typically involve forgiving a portion of interest or principal on existing loans, making loans at a rate materially less than current market rates, or extending the term of the loan. There were $0.7 million of Community Banking loans and $0.1 million of National Lending loans that were modified in a TDR during the three months ended June 30, 2019, all of which were modified to extend the term of the loan. No loans and leases were modified in a TDR during the three months ended June 30, 2018.

There were $1.7 million of National Lending loans and leases and $0.7 million of Community Banking loans that were modified in a TDR during the nine months ended June 30, 2019, all of which were modified to extend the term of the loan. There were $3.8 million of Community Banking loans that were modified in a TDR during the nine months ended June 30, 2018. During the nine months ended June 30, 2019, the Company had $0.9 million of Community Banking loans that were modified in a TDR within the previous 12 months and for which there was a payment default. During the nine months ended June 30, 2018, the Company had $0.1 million of Community Banking loans that were modified in a TDR within the previous 12 months and for which there was a payment default.

At June 30, 2019, foreclosed and repossessed assets totaled $29.5 million, compared to $31.6 million at September 30, 2018. At June 30, 2019, the Company had established a valuation allowance of $0.1 million for repossessed assets. The Company did not have a valuation allowance established for any foreclosed and repossessed assets at September 30, 2018. There were no impairments on any foreclosed and repossessed assets at either date. The Company had $0.2 million of Community Banking loans in the process of foreclosure at June 30, 2019 and none at September 30, 2018.

XML

EARNINGS PER COMMON SHARE

9 Months Ended

Jun. 30, 2019

Earnings Per Share [Abstract]

EARNINGS PER COMMON SHARE

EARNINGS PER COMMON SHARE

Earnings per common share is computed after deducting any preferred dividends, if applicable. The Company has granted restricted share awards with dividend rights that are considered to be participating securities. Accordingly, a portion of the Company’s earnings is allocated to those participating securities in the earnings per share calculation. Basic earnings per common share is computed by dividing income available to common stockholders after the allocation of dividends and undistributed earnings to the participating securities by the weighted average number of common shares outstanding for the period. Diluted earnings per common share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised, and is computed after giving consideration to the weighted average dilutive effect of the Company’s stock options and after the allocation of earnings to the participating securities. Antidilutive options are disregarded in earnings per share calculations. The share and per share amounts for fiscal year 2018 have been restated to reflect the 3-for-1 forward stock split of the Company's common stock that was effected by the Company on October 4, 2018.

A reconciliation of net income and common stock share amounts used in the computation of basic and diluted earnings per share for the three and nine months ended June 30, 2019 and 2018 is presented below.

Three Months Ended June 30,	2019		2018
(Dollars in Thousands, Except Share and Per Share Data)
Basic income per common share:
Net income attributable to Meta Financial Group, Inc.	$	29,291	$	6,792
Weighted average common shares outstanding	38,903,266		29,099,472
Basic income per common share	0.75		0.23
Diluted income per common share:
Net income attributable to Meta Financial Group, Inc.	$	29,291	$	6,792
Weighted average common shares outstanding	38,903,266		29,099,472
Outstanding options - based upon the two-class method	74,424		119,508
Weighted average diluted common shares outstanding	38,977,690		29,218,980
Diluted income per common share	0.75		0.23

Nine Months Ended June 30,	2019		2018
(Dollars in Thousands, Except Share and Per Share Data)
Basic income per common share:
Net income attributable to Meta Financial Group, Inc.	$	76,809	$	42,898
Weighted average common shares outstanding	39,220,793		29,043,309
Basic income per common share	1.96		1.48
Diluted income per common share:
Net income attributable to Meta Financial Group, Inc.	$	76,809	$	42,898
Weighted average common shares outstanding	39,220,793		29,043,309
Outstanding options - based upon the two-class method	68,218		116,676
Weighted average diluted common shares outstanding	39,289,011		29,159,985
Diluted income per common share	1.95		1.47

XML

SECURITIES

9 Months Ended

Jun. 30, 2019

Investments, Debt and Equity Securities [Abstract]

SECURITIES

SECURITIES

On October 1, 2018, the Company adopted ASU 2016-01 on a prospective basis, which redefined the definition of equity securities and required their segregation from available for sale debt securities. While changes in the fair value of debt securities continue to be recorded in the equity category of accumulated other comprehensive income, the new guidance requires that changes in fair value of equity securities with readily determinable fair value be recorded in current earnings. As required by the new guidance, the unrealized gain in fair value on equity securities with readily determinable fair value (recorded in accumulated other comprehensive income at September 30, 2018) was reclassified to retained earnings on October 1, 2018. The amount of the reclassification was $0.5 million, net of tax. Equity securities with readily determinable fair value include mutual funds of $1.8 million at cost and $1.9 million at fair value at June 30, 2019.

The amortized cost, gross unrealized gains and losses and estimated fair values of available for sale ("AFS") and held to maturity ("HTM") debt securities at June 30, 2019 and September 30, 2018 are presented below.

At June 30, 2019	AMORTIZED COST		GROSS UNREALIZED GAINS		GROSS UNREALIZED (LOSSES)			FAIR VALUE
	(Dollars in Thousands)
Debt securities AFS
SBA securities	$	189,816	$	3,271	$	(21	)	$	193,066
Obligations of states and political subdivisions	858		17		—			875
Non-bank qualified obligations of states and political subdivisions	459,551		3,456		(2,347		)	460,660
Asset-backed securities	308,711		753		(2,168		)	307,296
Mortgage-backed securities	395,059		2,838		(2,696		)	395,201
Total debt securities AFS	$	1,353,995	$	10,335	$	(7,232	)	$	1,357,098
Common equities and mutual funds(1)(2)	$	3,593	$	826	$	—		$	4,419

⁽¹⁾ Equity securities at fair value are included within other assets on the consolidated statement of financial condition at June 30, 2019 and September 30, 2018.

⁽²⁾ ASU 2016-01 adopted on October 1, 2018, on a prospective basis, removed equity securities from AFS category at June 30, 2019.

At September 30, 2018	AMORTIZED COST		GROSS UNREALIZED GAINS		GROSS UNREALIZED (LOSSES)			FAIR VALUE
	(Dollars in Thousands)
Debt securities AFS
SBA securities	$	45,591	$	1	$	(1,255	)	$	44,337
Obligations of states and political subdivisions	17,154		49		(293		)	16,910
Non-bank qualified obligations of states and political subdivisions	1,140,884		826		(31,825		)	1,109,885
Asset-backed securities	310,700		2,585		(257		)	313,028
Mortgage-backed securities	378,301		—		(14,236		)	364,065
Total debt securities AFS	$	1,892,630	$	3,461	$	(47,866	)	$	1,848,225
Common equities and mutual funds(1)	3,172		635		(7		)	3,800
Total AFS securities(1)	$	1,895,802	$	4,096	$	(47,873	)	$	1,852,025

⁽¹⁾ Equity securities at fair value are included within other assets on the consolidated statement of financial condition at June 30, 2019 and September 30, 2018.

At June 30, 2019	AMORTIZED COST		GROSS UNREALIZED GAINS		GROSS UNREALIZED (LOSSES)			FAIR VALUE
	(Dollars in Thousands)
Debt securities HTM
Non-bank qualified obligations of states and political subdivisions	$	138,128	$	15	$	(2,500	)	$	135,643
Mortgage-backed securities	7,414		—		(119		)	7,295
Total held to maturity securities	$	145,542	$	15	$	(2,619	)	$	142,938

At September 30, 2018	AMORTIZED COST		GROSS UNREALIZED GAINS		GROSS UNREALIZED (LOSSES)			FAIR VALUE
	(Dollars in Thousands)
Debt securities HTM
Non-bank qualified obligations of states and political subdivisions	$	163,893	$	—	$	(10,758	)	$	153,135
Mortgage-backed securities	7,850		—		(422		)	7,428
Total held to maturity securities	$	171,743	$	—	$	(11,180	)	$	160,563

Management has implemented a process to identify securities with potential credit impairment that are other-than-temporary.  This process involves evaluation of the length of time and extent to which the fair value has been less than the amortized cost basis, review of available information regarding the financial position of the issuer, monitoring the rating, watch, and outlook of the security, monitoring changes in value, cash flow projections, and the Company’s intent to sell a security or whether it is more likely than not the Company will be required to sell the security before the recovery of its amortized cost which, in some cases, may extend to maturity.  To the extent the Company determines that a security is deemed to be other-than-temporarily impaired, an impairment loss is recognized.

For all securities considered temporarily impaired, the Company does not intend to sell these securities, and it is not more likely than not that the Company will be required to sell the security before recovery of its amortized cost, which may occur at maturity.  The Company believes it will collect all principal and interest due on all investments with amortized cost in excess of fair value and considered only temporarily impaired.

GAAP requires that, at acquisition, an enterprise classify debt securities into one of three categories: AFS, HTM or trading. AFS securities are carried at fair value on the consolidated statements of financial condition, and unrealized holding gains and losses are excluded from earnings and recognized as a separate component of equity in accumulated other comprehensive income (“AOCI”). HTM debt securities are measured at amortized cost. Both AFS and HTM are subject to review for other-than-temporary impairment. The Company had no trading securities at June 30, 2019 or September 30, 2018.

Gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at June 30, 2019 and September 30, 2018, were as follows:

	LESS THAN 12 MONTHS					OVER 12 MONTHS					TOTAL
At June 30, 2019	Fair Value		Unrealized (Losses)			Fair Value		Unrealized (Losses)			Fair Value		Unrealized (Losses)
	(Dollars in Thousands)
Debt securities AFS
SBA securities	$	13,785	$	(21	)	$	—	$	—		$	13,785	$	(21	)
Obligations of states and political subdivisions	—		—			—		—			—		—
Non-bank qualified obligations of states and political subdivisions	—		—			230,117		(2,347		)	230,117		(2,347		)
Asset-backed securities	134,246		(1,230		)	62,450		(938		)	196,696		(2,168		)
Mortgage-backed securities	—		—			172,718		(2,696		)	172,718		(2,696		)
Total debt securities AFS	$	148,031	$	(1,251	)	$	465,285	$	(5,981	)	$	613,316	$	(7,232	)
Common equities and mutual funds(1)(2)	—		—			—		—			—		—

⁽¹⁾ Equity securities at fair value are included within other assets on the consolidated statement of financial condition at June 30, 2019 and September 30, 2018.

⁽²⁾ ASU 2016-01 adopted on October 1, 2018, on a prospective basis, removed equity securities from AFS category at June 30, 2019.

	LESS THAN 12 MONTHS					OVER 12 MONTHS					TOTAL
At September 30, 2018	Fair Value		Unrealized (Losses)			Fair Value		Unrealized (Losses)			Fair Value		Unrealized (Losses)
	(Dollars in Thousands)
Debt securities AFS
SBA securities	$	43,097	$	(1,255	)	$	—	$	—		$	43,097	$	(1,255	)
Obligations of state and political subdivisions	11,036		(279		)	881		(14		)	11,917		(293		)
Non-bank qualified obligations of states and political subdivisions	626,693		(13,539		)	358,095		(18,286		)	984,788		(31,825		)
Asset-backed securities	146,638		(257		)	—		—			146,638		(257		)
Mortgage-backed securities	121,217		(3,292		)	242,849		(10,944		)	364,066		(14,236		)
Total debt securities AFS	$	948,681	$	(18,622	)	$	601,825	$	(29,244	)	$	1,550,506	$	(47,866	)
Common equities and mutual funds(1)	1,818		(7		)	—		—			1,818		(7		)
Total debt AFS securities(1)	$	950,499	$	(18,629	)	$	601,825	$	(29,244	)	$	1,552,324	$	(47,873	)

⁽¹⁾Equity securities at fair value are included within other assets on the consolidated statement of financial condition at June 30, 2019 and September 30, 2018.

	LESS THAN 12 MONTHS				OVER 12 MONTHS					TOTAL
At June 30, 2019	Fair Value		Unrealized (Losses)		Fair Value		Unrealized (Losses)			Fair Value		Unrealized (Losses)
	(Dollars in Thousands)
Debt securities HTM
Non-bank qualified obligations of states and political subdivisions	$	—	$	—	$	129,424	$	(2,500	)	$	129,424	$	(2,500	)
Mortgage-backed securities	—		—		7,295		(119		)	7,295		(119		)
Total held to maturity securities	$	—	$	—	$	136,719	$	(2,619	)	$	136,719	$	(2,619	)

	LESS THAN 12 MONTHS					OVER 12 MONTHS					TOTAL
At September 30, 2018	Fair Value		Unrealized (Losses)			Fair Value		Unrealized (Losses)			Fair Value		Unrealized (Losses)
	(Dollars in Thousands)
Debt securities HTM
Non-bank qualified obligations of states and political subdivisions	$	5,767	$	(287	)	$	147,368	$	(10,471	)	$	153,135	$	(10,758	)
Mortgage-backed securities	—		—			7,428		(422		)	7,428		(422		)
Total held to maturity securities	$	5,767	$	(287	)	$	154,796	$	(10,893	)	$	160,563	$	(11,180	)

At June 30, 2019, the investment portfolio included securities with current unrealized losses that have existed for longer than one year.  All of these securities are considered to be acceptable credit risks. Because (i) the declines in fair value were due to changes in market interest rates, not in estimated cash flows, (ii) the Company does not intend or has not made a decision to sell these securities and (iii) it is not more likely than not that the Company will be required to sell the securities before recovery of their amortized cost basis, which may occur at maturity, no other-than-temporary impairment was recorded at June 30, 2019.

The amortized cost and fair value of debt securities by contractual maturity as of the dates set forth below are shown below.  Certain securities have call features which allow the issuer to call the security prior to maturity.  Expected maturities may differ from contractual maturities in mortgage-backed securities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.  Therefore, mortgage-backed securities are not included in the maturity categories in the following maturity summary.  The expected maturities of certain housing related municipal securities, SBA and asset-backed securities may differ from contractual maturities because the borrowers may have the right to prepay the obligation. However, certain prepayment penalties may apply.

AFS Securities at Fair Value	AMORTIZED COST		FAIR VALUE
At June 30, 2019	(Dollars in Thousands)
Due in one year or less	$	—	$	—
Due after one year through five years	11,336		11,711
Due after five years through ten years	62,337		64,221
Due after ten years	885,263		885,965
	958,936		961,897
Mortgage-backed securities	395,059		395,201
Total securities at fair value	$	1,353,995	$	1,357,098

	AMORTIZED COST		FAIR VALUE
At September 30, 2018	(Dollars in Thousands)
Due in one year or less	$	2,532	$	2,529
Due after one year through five years	41,415		41,504
Due after five years through ten years	352,099		350,143
Due after ten years	1,118,283		1,089,984
	1,514,329		1,484,160
Mortgage-backed securities	378,301		364,065
Common equities and mutual funds(1)	3,172		3,800
Total securities at fair value	$	1,895,802	$	1,852,025

⁽¹⁾Equity securities at fair value are included within other assets on the consolidated statement of financial condition at June 30, 2019 and September 30, 2018.

HTM Securities at Fair Value	AMORTIZED COST		FAIR VALUE
At June 30, 2019	(Dollars in Thousands)
Due after ten years	$	138,128	$	135,643
	138,128		135,643
Mortgage-backed securities	7,414		7,295
Total held to maturity securities at cost	$	145,542	$	142,938

	AMORTIZED COST		FAIR VALUE
At September 30, 2018	(Dollars in Thousands)
Due after ten years	$	163,893	$	153,135
	163,893		153,135
Mortgage-backed securities	7,850		7,428
Total held to maturity securities at cost	$	171,743	$	160,563

Other investments, at cost, which are included in other assets on the consolidated statement of financial condition, include equity securities without a readily determinable fair value and shares of stock in the Federal Home Loan Bank ("FHLB") of Des Moines. Equity securities without a readily determinable fair value totaled $2.5 million at June 30, 2019 and $2.0 million at September 30, 2018. FHLB of Des Moines stock at June 30, 2019 and September 30, 2018 totaled $17.2 million and $23.4 million, respectively. The decrease in FHLB stock directly correlates with lower short-term borrowings balances at June 30, 2019 compared to September 30, 2018. The Company’s wholly-owned subsidiary, MetaBank, is required by federal law to maintain FHLB stock as a member of FHLB of Des Moines. These equity securities are ‘restricted’ in that they can only be sold back to the respective institution from which they were acquired or another member institution at par. Therefore, FHLB stock is less liquid than other marketable equity securities, and the fair value approximates cost. The Company evaluates impairment for investments held at cost on at least an annual basis based on the ultimate recoverability of the par value. No impairment was recognized for such investments for the nine months ended June 30, 2019.

XML

RENTAL EQUIPMENT, NET

9 Months Ended

Jun. 30, 2019

Property, Plant and Equipment [Abstract]

RENTAL EQUIPMENT, NET

RENTAL EQUIPMENT, NET

Rental equipment was as follows as of June 30, 2019 and September 30, 2018.

	June 30, 2019			September 30, 2018
	(Dollars in thousands)
Computers and IT networking equipment	$	38,360		$	53,035
Motor vehicles and other	56,359			43,505
Office furniture and equipment	3,233			3,590
Solar panels and equipment	140,532			57,242
Total	238,484			157,372
Accumulated depreciation	(53,752		)	(50,082		)
Net book value	$	184,732		$	107,290

During the second quarter of fiscal year 2019, an impairment was recorded related to solar panels and equipment. Please refer to Note 3 for further discussion.

Future minimum lease payments receivable on equipment under operating leases was as follows as of June 30, 2019.

	June 30, 2019
	(Dollars in thousands)
Remaining in 2019	$	7,829
2020	26,938
2021	22,527
2022	15,911
2023	13,516
2024 and thereafter	28,309
Total	$	115,030

XML

GOODWILL AND INTANGIBLE ASSETS

9 Months Ended

Jun. 30, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND INTANGIBLE ASSETS

GOODWILL AND INTANGIBLE ASSETS

The Company held a total of $307.9 million of goodwill as of June 30, 2019. The recorded goodwill is a result of multiple business combinations that have occurred since fiscal year 2015, the most recent being the merger with Crestmark pursuant to the Crestmark acquisition that closed on August 1, 2018. Goodwill is assessed for impairment at a reporting unit level, which is one level below the operating segments.

The changes in the carrying amount of the Company’s goodwill and intangible assets for the nine months ended June 30, 2019 and 2018 were as follows:

	Payments		Banking		Corporate Services/Other		Total
Goodwill	(Dollars in Thousands)
September 30, 2018	$	87,145	$	216,125	$	—	$	303,270
Acquisitions	—		—		—		—
Measurement Period Adjustments (1)	—		4,671		—		4,671
Impairment	—		—		—		—
June 30, 2019	$	87,145	$	220,796	$	—	$	307,941
September 30, 2017	$	87,145	$	11,578	$	—	$	98,723
Acquisitions	—		—		—		—
Impairment	—		—		—		—
June 30, 2018	$	87,145	$	11,578	$	—	$	98,723

⁽¹⁾ The Company recognized measurement period adjustments on provisional goodwill during the second and third fiscal quarters of 2019 related to the Crestmark acquisition. Refer to Note 3. Acquisitions.

	Trademark(1)			Non-Compete(2)			Customer Relationships(3)			All Others(4)			Total
Intangibles	(Dollars in Thousands)
Balance as of September 30, 2018	$	12,987		$	1,297		$	48,455		$	7,980		$	70,719
Acquisitions during the period	—			—			—			100			100
Amortization during the period	(771		)	(353		)	(12,504		)	(724		)	(14,352		)
Write-offs during the period	—			—			—			(314		)	(314		)
Balance as of June 30, 2019	$	12,216		$	944		$	35,951		$	7,042		$	56,153
Gross carrying amount	$	14,624		$	2,480		$	82,088		$	10,688		$	109,880
Accumulated amortization	(2,408		)	(1,536		)	(35,889		)	(2,987		)	(42,820		)
Accumulated impairment	—			—			(10,248		)	(659		)	(10,907		)
Balance as of June 30, 2019	$	12,216		$	944		$	35,951		$	7,042		$	56,153

⁽¹⁾ Book amortization period of 5-15 years. Amortized using the straight line and accelerated methods.

⁽²⁾ Book amortization period of 3-5 years. Amortized using the straight line method.

⁽³⁾ Book amortization period of 10-30 years. Amortized using the accelerated method.

⁽⁴⁾ Book amortization period of 3-20 years. Amortized using the straight line method.

	Trademark(1)			Non-Compete(2)			Customer Relationships(3)			All Others(4)			Total
Intangibles	(Dollars in Thousands)
Balance as of September 30, 2017	$	10,051		$	1,782		$	31,707		$	8,638		$	52,178
Acquisitions during the period	—			—			—			85			85
Amortization during the period	(477		)	(367		)	(4,548		)	(685		)	(6,077		)
Write-offs during the period	—			—			—			(88		)	(88		)
Balance as of June 30, 2018	$	9,574		$	1,415		$	27,159		$	7,950		$	46,098
Gross carrying amount	$	10,990		$	2,480		$	57,810		$	10,587		$	81,867
Accumulated amortization	(1,416		)	(1,065		)	(20,403		)	(2,020		)	(24,904		)
Accumulated impairment	—			—			(10,248		)	(617		)	(10,865		)
Balance as of June 30, 2018	$	9,574		$	1,415		$	27,159		$	7,950		$	46,098

⁽¹⁾ Book amortization period of 15 years. Amortized using the straight line and accelerated methods.

⁽²⁾ Book amortization period of 3 years. Amortized using the straight line method.

⁽³⁾ Book amortization period of 10-30 years. Amortized using the accelerated method.

⁽⁴⁾ Book amortization period of 3-20 years. Amortized using the straight line method.

The estimated amortization expense of intangible assets assumes no activities, such as acquisitions, which would result in additional amortizable intangible assets. Estimated amortization expense of intangible assets in the remaining three months of fiscal 2019 and subsequent fiscal years is as follows:

	(Dollars in Thousands)
Remaining in 2019	$	3,357
2020	10,986
2021	8,527
2022	6,402
2023	5,084
2024	4,367
Thereafter	17,430
Total anticipated intangible amortization	$	56,153

The Company tests intangible assets for impairment at least annually or more often if conditions indicate a possible impairment.  There was $0.1 million in impairments to intangible assets during the nine months ended June 30, 2019 and no impairments to intangible assets during the three months ended June 30, 2019 or the three and nine months ended June 30, 2018.

XML

STOCK COMPENSATION

9 Months Ended

Jun. 30, 2019

Share-based Payment Arrangement [Abstract]

STOCK COMPENSATION

STOCK COMPENSATION

The Company maintains the amended and restated Meta Financial Group, Inc. 2002 Omnibus Incentive Plan, as amended (the "2002 Omnibus Incentive Plan"), which, among other things, provides for the awarding of stock options and nonvested (restricted) shares to certain officers and directors of the Company. Awards are granted by the Compensation Committee of the Board of Directors based on the performance of the award recipients or other relevant factors.

Compensation expense for share-based awards is recorded over the vesting period at the fair value of the award at the time of the grant. The exercise price of options or fair value of non-vested (restricted) shares granted under the Company’s incentive plan is equal to the fair market value of the underlying stock at the grant date. The Company has elected, with the adoption of ASU 2016-09, to record forfeitures as they occur.

The following tables show the activity of options and nonvested (restricted) shares granted, exercised, or forfeited under the 2002 Omnibus Incentive Plan for the nine months ended June 30, 2019:

	Number of Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Yrs)	Aggregate Intrinsic Value
	(Dollars in Thousands, Except Per Share Data (1))
Options outstanding, September 30, 2018	155,961		$	8.48	1.78	$	2,974
Granted	—		—		—	—
Exercised	(48,678	)	9.07		—	802
Forfeited or expired	(3,027	)	10.60		—	33
Options outstanding, June 30, 2019	104,256		$	8.14	1.22	$	2,075
Options exercisable, June 30, 2019	104,256		$	8.14	1.22	$	2,075

	Number of Shares		Weighted Average Fair Value at Grant
(Dollars in Thousands, Except Per Share Data (1))
Nonvested (restricted) shares outstanding, September 30, 2018	1,005,813		$	29.89
Granted	296,302		24.84
Vested	(352,218	)	26.77
Forfeited or expired	(2,679	)	26.14
Nonvested (restricted) shares outstanding, June 30, 2019	947,218		$	29.48

⁽¹⁾ All share and per share data has been adjusted to reflect the 3-for-1 forward stock split effected by the Company on October 4, 2018.

At June 30, 2019, stock-based compensation expense not yet recognized in income totaled $13.5 million, which is expected to be recognized over a weighted average remaining period of 3.09 years.

XML

STOCKHOLDERS' EQUITY

9 Months Ended

Jun. 30, 2019

Equity [Abstract]

STOCKHOLDERS' EQUITY

STOCKHOLDERS' EQUITY

Retirement of Treasury Stock

On June 25, 2019, Meta retired $5.0 million, or 114,558 shares, of common stock held in treasury. The Company accounts for the retirement of repurchased shares, including treasury stock, using the par value method under which the repurchase price is charged to paid-in capital up to the amount of the original proceeds of those shares. When the repurchase price is greater than the original issue proceeds, the excess is charged to retained earnings.

Repurchase of Common Stock

On March 26, 2019, Meta announced a share repurchase program of up to 2.0 million of its outstanding shares of common stock, or approximately 5% of its outstanding shares. The program became effective on May 1, 2019 and is scheduled to expire on September 30, 2021. During the third quarter of fiscal 2019, Meta repurchased under the program a total of $43.0 million, or 1,574,734 shares of its common stock, at an average price of $27.31 per share. Under the repurchase program, repurchased shares were retired and designated as authorized but unissued shares, and the value of the shares reduced retained earnings. As of June 30, 2019, the remaining number of shares available for repurchase under this program was 425,266 shares of common stock.

For the nine months ended June 30, 2019, and 2018, the Company also repurchased 90,264 and 17,155 shares, or $3.0 million and $1.4 million, of common stock, respectively, in settlement of employee tax withholding obligations due upon the vesting of restricted stock.

XML

INCOME TAXES

9 Months Ended

Jun. 30, 2019

Income Tax Disclosure [Abstract]

INCOME TAXES

INCOME TAXES

The Company recorded an income tax benefit of $3.2 million for the nine months ended June 30, 2019, resulting in an effective tax rate of (4.20%), compared to an income tax expense of $12.7 million, or an effective tax rate of 22.90%, for the nine months ended June 30, 2018. The Company’s effective tax rate is lower than the U.S. statutory rate of 21% primarily because of the anticipated effect of investment tax credits during fiscal year 2019. The Company’s effective tax rate in the future will depend in part on actual investment tax credits earned as part of its financing of solar energy projects.

The table below compares the income tax expense components for the periods presented.

Nine Months Ended June 30,	2019			2018
(Dollars in Thousands)
Provision at statutory rate	$	15,449		$	13,639
Tax-exempt income	(2,360		)	(5,506		)
State income taxes	3,243			2,314
Interim period effective rate adjustment	1,397			(1,070		)
Tax credit investments, net - federal	(22,484		)	—
Tax Reform rate adjustment	—			3,635
IRC 162(m) nondeductible compensation	1,612			—
Other, net	(101		)	(304		)
Income tax expense	$	(3,244	)	$	12,708
Effective tax rate	(4.2		%)	22.9		%

XML

COMMITMENTS AND CONTINGENCIES

9 Months Ended

Jun. 30, 2019

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

In the normal course of business, the Bank makes various commitments to extend credit that are not reflected in the accompanying Consolidated Financial Statements.

At June 30, 2019 and September 30, 2018, unfunded loan commitments approximated $1.01 billion and $748.8 million, respectively, excluding undisbursed portions of loans in process. Commitments, which are disbursed subject to certain limitations, extend over various periods of time.  Generally, unused commitments are canceled upon expiration of the commitment term as outlined in each individual contract.

The Company had $1.7 million and $1.4 million in commitments to purchase securities at June 30, 2019 and September 30, 2018, respectively. The Company had no commitments to sell securities at June 30, 2019 or September 30, 2018.

The exposure to credit loss in the event of non-performance by other parties to financial instruments for commitments to extend credit is represented by the contractual amount of those instruments.  The same credit policies and collateral requirements are used in making commitments and conditional obligations as are used for on-balance-sheet instruments. At June 30, 2019 and at September 30, 2018, the Company had an allowance for credit losses on off-balance sheet credit exposures of $0.1 million. This amount is maintained as a separate liability account within other liabilities.

Since certain commitments to make loans and to fund lines of credit and loans in process expire without being used, the amount does not necessarily represent future cash commitments.  In addition, commitments used to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract.

As disclosed in Note 3. Acquisitions, the Company continues to monitor the bankruptcy proceedings and federal investigations of DC Solar. As of the date of the filing of this quarterly report, the Company has not accrued for any additional loss contingencies related to DC Solar as of June 30, 2019.

Legal Proceedings

The Bank was served on April 15, 2013, with a lawsuit captioned Inter National Bank v. NetSpend Corporation, MetaBank, BDO USA, LLP d/b/a BDO Seidman, Cause No. C-2084-12-I filed in the District Court of Hidalgo County, Texas. The Plaintiff’s Second Amended Original Petition and Application for Temporary Restraining Order and Temporary Injunction added both MetaBank and BDO Seidman to the original causes of action against NetSpend. NetSpend acts as a prepaid card program manager and processor for both Inter National Bank and MetaBank. The parties entered into a settlement agreement with respect to the litigation in May 2019, and the court dismissed the litigation in June 2019.

The Bank was served, on October 14, 2016, with a lawsuit captioned Card Limited, LLC v. MetaBank dba Meta Payment Systems, Civil No. 2:16-cv-00980 in the United States District Court for the District of Utah. This action was initiated by a former prepaid program manager of the Bank, which was terminated by the Bank in fiscal year 2016. Card Limited alleges that after all of the programs were wound down, there were two accounts with a positive balance to which they are entitled. The Bank’s position is that Card Limited is not entitled to the funds contained in said accounts. The total amount to which Card Limited claims it is entitled is $4.0 million. The Bank intends to vigorously defend this claim. An estimate of a range of reasonably possible loss cannot be made at this stage of the litigation because discovery is still being conducted.

On February 9, 2018, the Bank’s AFS/IBEX division filed a lawsuit in the United States District Court for the Eastern District of New York captioned AFS/IBEX, a division of MetaBank v. Aegis Managing Agency Limited ("AMA"), Aegis Syndicate 1225 (together with AMA, the "Aegis defendants"), CRC Insurance Services, Inc. ("CRC"), and Transportation Underwriters, Inc. The suit was filed against commercial insurance underwriters and brokers that facilitated the issuance of commercial insurance policies to Red Hook Construction Group-II, LLC (“Red Hook”). The Bank’s position is that both CRC and Transportation Underwriters represented to the Bank that, upon cancellation of the insurance policies prior to their stated terms, any unearned premiums would be refunded. The Bank then provided insurance premium financing to Red Hook, and Red Hook executed a written premium finance agreement pursuant to which Red Hook assigned its rights to any unearned premiums to the Bank. After the policies were cancelled, the Aegis defendants failed to return the unearned insurance premiums totaling just over $1.6 million owed to the Bank under the insurance policies and the premium finance agreement. The Bank is seeking recovery of all amounts to which it is entitled at law or equity and intends to vigorously pursue its claims against the defendants.

The Bank was served on December 24, 2018, with a lawsuit captioned The Ohio Valley Bank Company v. MetaBank dba Refund Advantage, Case No. 18 CV 134 in the Court of Common Pleas, Gallia County, Ohio. This action alleges that MetaBank breached a contract with The Ohio Valley Bank Company by terminating the contract before the term expired, resulting in over $3.0 million in damages. The Bank intends to vigorously defend this claim. The Company has established an accrual for this related claim.

From time to time, the Company or its subsidiaries are subject to certain legal proceedings and claims in the ordinary course of business. Accruals have been recorded when the outcome is probable and can be reasonably estimated. While management currently believes that the ultimate outcome of these proceedings will not have a material adverse effect on the Company’s financial position or its results of operations, legal proceedings are inherently uncertain and unfavorable resolution of some or all of these matters could, individually or in the aggregate, have a material adverse effect on the Company’s and its subsidiaries’ respective businesses, financial condition or results of operations.

XML

REVENUE FROM CONTRACTS WITH CUSTOMERS

9 Months Ended

Jun. 30, 2019

Revenue from Contract with Customer [Abstract]

REVENUE FROM CONTRACTS WITH CUSTOMERS

REVENUE FROM CONTRACTS WITH CUSTOMERS

On October 1, 2018, the Company adopted Topic 606 on a modified retrospective basis. Prior period amounts have not been adjusted to reflect the adoption of Topic 606 and continue to be reported in accordance with the Company’s historical accounting policies. The impact of the Company’s adoption of Topic 606 was limited to the MPS division within the Payments reporting segment. Upon adoption, Meta recorded a cumulative-effect adjustment that increased retained earnings by $1.5 million, net of tax.

Topic 606 applies to all contracts with customers unless such revenue is specifically addressed under existing guidance. The table below presents the Company’s revenue by operating segment. For additional descriptions of the Company’s operating segments, including additional financial information and the underlying management accounting process, see Note 15. Segment Reporting to the Consolidated Financial Statements.

(Dollars in thousands)	Payments					Banking				Corporate Services/Other						Consolidated Company
Three Months Ended June 30,	2019		2018			2019		2018		2019			2018			2019		2018
Net interest income(1)	$	15,232	$	6,298		$	60,043	$	18,077	$	(8,307	)	$	4,036		$	66,968	$	28,411
Noninterest income:
Refund transfer product fees	6,697		7,358			—		—		—			—			6,697		7,358
Tax advance product fees(1)	34		(46		)	—		—		—			—			34		(46		)
Card fees	19,445		22,717			92		90		—			—			19,537		22,807
Rental income(1)	4		—			9,382		—		—			—			9,386		—
Loan and lease fees(1)	—		—			1,012		1,111		—			—			1,012		1,111
Bank-owned life insurance(1)	—		—			—		—		628			633			628		633
Deposit fees	1,932		1,027			403		107		—			—			2,335		1,134
Gain (loss) on sale of securities available-for-sale, net(1)	—		—			—		—		440			(22		)	440		(22		)
Gain on sale of loans and leases(1)	—		—			1,913		—		—			—			1,913		—
Other income(1)	290		251			781		10		737			(11		)	1,808		250
Total noninterest income	28,402		31,307			13,583		1,318		1,805			600			43,790		33,225
Revenue	$	43,634	$	37,605		$	73,626	$	19,395	$	(6,502	)	$	4,636		$	110,758	$	61,636

⁽¹⁾ These revenues are not within the scope of Topic 606. Additional details are included in other footnotes to the accompanying financial statements. The scope of Topic 606 explicitly excludes net interest income as well as many other revenues for financial assets and liabilities, including loans, leases, and securities.

(Dollars in thousands)	Payments				Banking						Corporate Services/Other						Consolidated Company
Nine Months Ended June 30,	2019		2018		2019			2018			2019			2018			2019			2018
Net interest income(1)	$	38,238	$	15,900	$	168,107		$	49,794		$	(7,755	)	$	16,318		$	198,590		$	82,012
Noninterest income:
Refund transfer product fees	38,559		41,353		—			—			—			—			38,559			41,353
Tax advance product fees(1)	34,757		35,739		—			—			—			—			34,757			35,739
Card fees	61,678		74,662		261			248			—			—			61,939			74,910
Rental income(1)	5		—		30,162			—			—			—			30,167			—
Loan and lease fees(1)	—		—		3,185			3,445			—			—			3,185			3,445
Bank-owned life insurance(1)	—		—		—			—			1,901			1,952			1,901			1,952
Deposit fees	5,177		2,634		1,188			330			—			—			6,365			2,964
Gain (loss) on sale of securities available-for-sale, net(1)	—		—		—			—			649			(1,198		)	649			(1,198		)
Gain on sale of loans and leases(1)	—		—		3,865			—			—			—			3,865			—
Loss on foreclosed real estate(1)	—		—		(185		)	(19		)	—			—			(185		)	(19		)
Other income(1)	804		694		3,323			40			1,236			32			5,363			766
Total noninterest income	140,980		155,082		41,799			4,044			3,786			786			186,565			159,912
Revenue	$	179,218	$	170,982	$	209,906		$	53,838		$	(3,969	)	$	17,104		$	385,155		$	241,924

⁽¹⁾ These revenues are not within the scope of Topic 606. Additional details are included in other footnotes to the accompanying financial statements. The scope of Topic 606 explicitly excludes net interest income as well as many other revenues for financial assets and liabilities, including loans, leases, and securities.

Following is a discussion of key revenues within the scope of Topic 606. The Company provides services to customers that have related performance obligations that must be completed to recognize revenue. Revenues are generally recognized immediately upon the completion of the service or over time as services are performed. Any services performed over time generally require that the Company renders services each period, therefore the Company measures progress in completing these services based upon the passage of time. Revenue from contracts with customers did not generate significant contract assets and liabilities.

Refund Transfer Product Fees

Refund transfer fees are specific to the tax products offered by Refund Advantage and EPS. These fees are for products, services such as payment processing, and product referral commissions. Software partner fees paid and/or incurred are recorded on a net basis. The Company’s obligation for product fees and commissions is satisfied at the time of the product delivery and obligation for payment processing is satisfied at the time of processing. The transaction price for such activity is based upon stand-alone fees within the terms and conditions. As of June 30, 2019, there were no receivables related to refund transfer fees, which reflect earned revenue with unconditional rights to payment for product fee income, while as of September 30, 2018, there were $827,039 of such receivables. All refund transfer fees are recorded within the Payments reporting segment.

Card Fees

Card fees relate to MPS, retail bank, Refund Advantage and EPS products. These fees are for products and services such as card activation, product support, processing, and servicing. The Company earns these fees based upon the underlying terms and conditions with each cardholder over the contract term. Agreements with the Company’s cardholders are considered daily service contracts as they are not fixed in duration. The Company’s obligation for card activation and product support fees is satisfied at the time of product delivery, while the obligation for processing and servicing is satisfied over the course of each month. The transaction price for such activity is based upon the stand-alone fees within the terms and conditions of the cardholder agreements. Card fee revenue also includes income from sponsorships, associations and networks, and interchange income. Sponsorship income relates to fees charged to the Company’s ATM sponsorship partners, where the obligation is satisfied over the course of each month. Association and network income reflect incentives, performance bonuses and rebates with MasterCard and Visa. The obligation for such income is satisfied at the time when certain thresholds of transaction volume have been met. Interchange income is generated by cardholder activity, and therefore the Company’s obligations are satisfied as activity occurs. The transaction price for such activity is based on underlying rates and activity thresholds within the terms and conditions of the applicable agreements. Card fee revenue also includes breakage revenue. Breakage represents the estimated amount that will not be redeemed by the holder of unregistered, unused prepaid cards for goods or services. Breakage revenue is recognized ratably over the expected customer usage period and is an estimate based on cardholder behavior and breakage rates. Breakage is also impacted by escheatment laws. Card fees are recorded within the Payments and Banking reporting segments.

Deposit Fees

Fees are earned on depository accounts for commercial and consumer customers and include fees for account services, overdraft services, safety deposit box rentals, and event-driven services (i.e. returned checks, ATM surcharge, card replacement, wire transfers, and stop pays). The Company’s obligation for event-driven services is satisfied at the time of the event when the service is delivered, while its obligation for account services is satisfied over the course of each month. The Company’s obligation for overdraft services is satisfied at the time of overdraft. The transaction price for such activity is based upon stand-alone fees within the terms and conditions of the deposit agreements. Deposit fees are recorded within the Payments and Banking reporting segment.

Principal vs Agent

The Payments reporting segment includes principal/agent relationships. Within this segment, MPS relationships are recorded on a gross basis within the income statement, as Meta is the principal in the contract, with the exception of association/network contracts and partner/processer contracts for prepaid cards, which are recorded on a net basis within the income statement as Meta is the agent in these contracts. Also within this segment, Tax service relationships are recorded on a gross basis within the income statement, as Meta is the principal in the contract, with the exception of contracts with software providers and merchants, which are recorded on a net basis within the income statement as Meta is the agent in these contracts.

XML

FAIR VALUE MEASUREMENTS

9 Months Ended

Jun. 30, 2019

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

Accounting Standards Codification (“ASC”) 820, Fair Value Measurements defines fair value, establishes a framework for measuring the fair value of assets and liabilities using a hierarchy system and requires disclosures about fair value measurement.  It clarifies that fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants in the market in which the reporting entity transacts.

The fair value hierarchy is as follows:

Level 1 Inputs - Valuation is based upon quoted prices for identical instruments traded in active markets that the Company has the ability to access at measurement date.

Level 2 Inputs - Valuation is based upon (1) quoted prices for similar instruments in active markets, (2) quoted prices for identical or similar instruments in markets that are not active and (3) model-based valuation techniques for which significant assumptions are observable in the market.

Level 3 Inputs - Valuation is generated from model-based techniques that use significant assumptions not observable in the market and are used only to the extent that observable inputs are not available. These unobservable assumptions reflect the Company’s own estimates of assumptions that market participants would use in pricing the asset or liability.  Valuation techniques include use of option pricing models, discounted cash flow models and similar techniques.

Debt Securities Available for Sale and Equity Securities. Debt securities available for sale and equity securities are recorded at fair value on a recurring basis and securities held to maturity are carried at amortized cost.  Fair value measurement is based upon quoted prices, if available.  If quoted prices are not available, fair values are measured using an independent pricing service. For both Level 1 and Level 2 securities, management uses various methods and techniques to corroborate prices obtained from the pricing service, including but not limited to reference to dealer or other market quotes, and by reviewing valuations of comparable instruments. The Company’s Level 1 securities include equity securities and mutual funds. Level 2 securities include U.S. Government agency and instrumentality securities, U.S. Government agency and instrumentality mortgage-backed securities, municipal bonds and corporate debt securities.  The Company had no Level 3 securities at June 30, 2019 or September 30, 2018.

The fair values of securities are determined by obtaining quoted prices on nationally recognized securities exchanges (Level 1 inputs), or valuation based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model based valuation techniques for which significant assumptions are observable in the market (Level 2 inputs). The Company considers these valuations supplied by a third party provider which utilizes several sources for valuing fixed-income securities. These sources include Interactive Data Corporation, Reuters, Standard and Poor’s, Bloomberg Financial Markets, Street Software Technology, and the third party provider’s own matrix and desk pricing.  The Company, no less than annually, reviews the third party’s methods and source’s methodology for reasonableness and to ensure an understanding of inputs utilized in determining fair value. Sources utilized by the third party provider include but are not limited to pricing models that vary based by asset class and include available trade, bid, and other market information. This methodology includes but is not limited to broker quotes, proprietary models, descriptive terms and conditions databases, as well as extensive quality control programs. Monthly, the Company receives and compares prices provided by multiple securities dealers and pricing providers to validate the accuracy and reasonableness of prices received from the third party provider. On a monthly basis, the Investment Committee reviews mark-to-market changes in the securities portfolio for reasonableness.

The following table summarizes the fair values of debt securities available for sale and equity securities at June 30, 2019 and September 30, 2018, as they are measured at fair value on a recurring basis.

	Fair Value At June 30, 2019
(Dollars in Thousands)	Total		Level 1		Level 2		Level 3
Debt securities AFS
SBA securities	$	193,066	$	—	$	193,066	$	—
Obligations of states and political subdivisions	875		—		875		—
Non-bank qualified obligations of states and political subdivisions	460,660		—		460,660		—
Asset-backed securities	307,296		—		307,296		—
Mortgage-backed securities	395,201		—		395,201		—
Total debt securities AFS	$	1,357,098	$	—	$	1,357,098	$	—
Common equities and mutual funds(1)(2)	$	4,419	$	4,419	$	—	$	—

⁽¹⁾ Equity securities at fair value are included within other assets on the consolidated statement of financial condition at June 30, 2019 and September 30, 2018.

⁽²⁾ ASU 2016-01 adopted on October 1, 2018, on a prospective basis, removed equity securities from AFS category at June 30, 2019.

	Fair Value At September 30, 2018
(Dollars in Thousands)	Total		Level 1		Level 2		Level 3
Debt securities AFS
SBA securities	$	44,337	$	—	$	44,337	$	—
Obligations of states and political subdivisions	16,910		—		16,910		—
Non-bank qualified obligations of states and political subdivisions	1,109,885		—		1,109,885		—
Asset-backed securities	313,028		—		313,028		—
Mortgage-backed securities	364,065		—		364,065		—
Total debt securities AFS	1,848,225		—		1,848,225		—
Common equities and mutual funds(1)	3,800		3,800		—		—
Total securities	$	1,852,025	$	3,800	$	1,848,225	$	—

⁽¹⁾ Equity securities at fair value are included within other assets on the consolidated statement of financial condition at June 30, 2019 and September 30, 2018.

The Company did not transfer any AFS debt securities or equity securities between fair value hierarchy categories at June 30, 2019 or September 30, 2018.

Loans and Leases.  The Company does not record loans and leases at fair value on a recurring basis.  If a loan or lease is identified as individually impaired, management then measures impairment in accordance with ASC 310, Receivables. See Note 4 Loans and Leases, Net for further information.

The following table summarizes the assets of the Company that were measured at fair value in the consolidated statements of financial condition on a non-recurring basis as of June 30, 2019 and September 30, 2018.

	Fair Value At June 30, 2019
(Dollars in Thousands)	Total		Level 1		Level 2		Level 3
Impaired Loans and Leases, net
Asset based lending	$	83	$	—	$	—	$	83
Factoring	3,960		—		—		3,960
Commercial finance	4,043		—		—		4,043
Total National Lending	4,043		—		—		4,043
Total impaired loans and leases	4,043		—		—		4,043
Foreclosed assets, net	29,514		—		—		29,514
Total	$	33,557	$	—	$	—	$	33,557

	Fair Value At September 30, 2018
(Dollars in Thousands)	Total		Level 1		Level 2		Level 3
Impaired loans and leases, net
Asset based lending	$	57	$	—	$	—	$	57
Factoring	1,899		—		—		1,899
Lease financing	2,869		—		—		2,869
Commercial finance	4,825		—		—		4,825
Total National Lending	4,825		—		—		4,825
Total impaired loans and leases	4,825		—		—		4,825
Foreclosed assets, net	31,638		—		—		31,638
Total	$	36,463	$	—	$	—	$	36,463

	Quantitative Information About Level 3 Fair Value Measurements
(Dollars in Thousands)	Fair Value at June 30, 2019		Fair Value at September 30, 2018	Valuation Technique	Unobservable Input	Range of Inputs
Impaired loans and leases, net	$	4,043	4,825	Market approach	Appraised values(1)	4.00 - 10.00%
Foreclosed assets, net	$	29,514	31,638	Market approach	Appraised values(1)	4.00 - 30.00%

⁽¹⁾ The Company generally relies on external appraisers to develop this information. Management reduced the appraised value by estimating selling costs and other inputs in a range of 4% to 30%.

The following table discloses the Company’s estimated fair value amounts of its financial instruments as of the dates set forth below.  It is management’s belief that the fair values presented below are reasonable based on the valuation techniques and data available to the Company as of June 30, 2019 and September 30, 2018, as more fully described below.  The operations of the Company are managed from a going concern basis and not a liquidation basis.  As a result, the ultimate value realized for the financial instruments presented could be substantially different when actually recognized over time through the normal course of operations.  Additionally, a substantial portion of the Company’s inherent value is the Bank’s capitalization and franchise value.  Neither of these components have been given consideration in the presentation of fair values below.

The following presents the carrying amount and estimated fair value of the financial instruments held by the Company at June 30, 2019 and September 30, 2018.

	June 30, 2019
(Dollars in Thousands)	Carrying Amount		Estimated Fair Value		Level 1		Level 2		Level 3
Financial assets
Cash and cash equivalents	$	100,732	$	100,732	$	100,732	$	—	$	—
Debt securities available for sale	1,357,098		1,357,098		—		1,357,098		—
Debt securities held to maturity	145,542		142,938		—		142,938		—
Equity securities(1)	4,419		4,419		4,419		—		—
Total securities	1,507,059		1,504,455		4,419		1,500,036		—
Loans held for sale	62,839		62,839		—		62,839		—
Loans and leases:
Asset based lending	615,309		599,664		—		—		599,664
Factoring	320,344		316,278		—		—		316,278
Lease financing	341,957		338,804		—		—		338,804
Insurance premium finance	358,772		358,401		—		—		358,401
SBA/USDA	99,791		94,391		—		—		94,391
Other commercial finance	99,677		101,145		—		—		101,145
Commercial finance	1,835,850		1,808,683		—		—		1,808,683
Consumer credit products	155,539		156,539		—		—		156,539
Other consumer finance	164,727		160,239		—		—		160,239
Consumer finance	320,266		316,778		—		—		316,778
Tax services	24,410		8,985		—		—		8,985
Warehouse finance	250,003		250,053		—		—		250,053
Total National Lending	2,430,529		2,384,499		—		—		2,384,499
Commercial real estate and operating	877,412		867,725		—		—		867,725
Consumer one to four family real estate and other	256,853		258,359		—		—		258,359
Agricultural real estate and operating	61,169		59,270		—		—		59,270
Total Community Banking	1,195,434		1,185,354		—		—		1,185,354
Total loans and leases	3,625,963		3,569,853		—		—		3,569,853
Federal Home Loan Bank stock	17,236		17,236		—		17,236		—
Accrued interest receivable	19,722		19,722		19,722		—		—
Financial liabilities
Noninterest-bearing demand deposits	2,751,931		2,751,931		2,751,931		—		—
Interest-bearing demand deposits, savings, and money markets	278,585		278,585		278,585		—		—
Time certificates of deposits	116,698		116,657		—		116,657		—
Wholesale non-maturing deposits	216,598		216,598		216,598		—		—
Wholesale time certificates of deposits	1,411,402		1,412,931		—		1,412,931		—
Total deposits	4,775,214		4,776,702		3,247,114		1,529,588		—
Overnight federal funds purchased	135,000		135,000		135,000		—		—
Long-term Federal Home Loan Bank advances	110,000		110,578		—		110,578		—
Securities sold under agreements to repurchase	3,658		3,658		—		3,658		—
Capital leases	1,972		1,972		—		1,972		—
Trust preferred securities	13,661		13,879		—		13,879		—
Subordinated debentures	73,605		76,875		—		76,875		—
Other borrowings	18,482		18,307		—		18,307		—
Accrued interest payable	12,350		12,350		12,350		—		—

⁽¹⁾ Equity securities at fair value are included within other assets on the consolidated statement of financial condition at June 30, 2019 and September 30, 2018.

	September 30, 2018
(Dollars in Thousands)	Carrying Amount		Estimated Fair Value		Level 1		Level 2		Level 3
Financial assets
Cash and cash equivalents	$	99,977	$	99,977	$	99,977	$	—	$	—
Securities available for sale	1,852,025		1,852,025		3,800		1,848,225		—
Securities held to maturity	172,154		160,974		—		160,974		—
Total securities	2,024,179		2,012,999		3,800		2,009,199		—
Loans held for sale	15,606		15,606		—		15,606		—
Loans and leases:
Asset based lending	477,917		477,471		—		—		477,471
Factoring	284,221		283,424		—		—		283,424
Lease financing	265,315		264,679		—		—		264,679
Insurance premium finance	337,877		337,212		—		—		337,212
SBA/USDA	59,374		61,072		—		—		61,072
Other commercial finance	85,145		83,111		—		—		83,111
Commercial finance	1,509,849		1,506,969		—		—		1,506,969
Consumer credit products	80,605		80,633		—		—		80,633
Other consumer finance	189,756		197,320		—		—		197,320
Consumer finance	270,361		277,953		—		—		277,953
Tax services	1,073		1,073		—		—		1,073
Warehouse finance	65,000		64,978		—		—		64,978
Total National Lending	1,846,283		1,850,973		—		—		1,850,973
Commercial real estate and operating	790,890		773,203		—		—		773,203
Consumer one to four family real estate and other	247,318		244,730		—		—		244,730
Agricultural real estate and operating	60,498		58,849		—		—		58,849
Total Community Banking	1,098,706		1,076,782		—		—		1,076,782
Total loans and leases	2,944,989		2,927,755		—		—		2,927,755
Federal Home Loan Bank stock	23,400		23,400		—		23,400		—
Accrued interest receivable	22,016		22,016		22,016		—		—
Financial liabilities
Noninterest-bearing demand deposits	2,405,274		2,405,274		2,405,274		—		—
Interest-bearing demand deposits, savings, and money markets	218,347		218,347		218,347		—		—
Time certificates of deposits	276,180		273,800		—		273,800		—
Wholesale non-maturing deposits	94,384		94,384		94,384		—		—
Wholesale time certificates of deposits	1,436,802		1,432,146		—		1,432,146		—
Total deposits	4,430,987		4,423,951		2,718,005		1,705,946		—
Overnight federal funds purchased	422,000		422,000		422,000		—		—
Securities sold under agreements to repurchase	3,694		3,694		—		3,694		—
Capital leases	1,876		1,876		—		1,876		—
Trust preferred securities	13,661		13,866		—		13,866		—
Subordinated debentures	73,491		75,563		—		75,563		—
Accrued interest payable	7,794		7,794		7,794		—		—

The following sets forth the methods and assumptions used in determining the fair value estimates for the Company’s financial instruments at June 30, 2019 and September 30, 2018.

CASH AND CASH EQUIVALENTS

The carrying amount of cash and short-term investments is assumed to approximate the fair value.

DEBT SECURITIES AVAILABLE FOR SALE AND EQUITY SECURITIES

Debt securities available for sale and equity securities are recorded at fair value on a recurring basis. Fair values for these investment securities are based on obtaining quoted prices on nationally recognized securities exchanges, or matrix pricing, which is a mathematical technique widely used in the industry to value debt securities without relying exclusively on quoted prices for the specific securities, but rather by relying on the securities’ relationship to other benchmark quoted securities.

LOANS HELD FOR SALE

The carrying amount of loans held for sale is assumed to approximate the fair value.

LOANS AND LEASES, NET

Upon adoption of ASU 2016-01, the fair value of loans and leases were estimated using an exit price methodology. The exit price estimation of fair value is based on the present value of expected cash flows, which are based on the contractual terms of the loans, adjusted for prepayments and a discount rate based on the relative risk of the cash flows. Other considerations include the loan type, remaining life of the loan and credit risk. In comparison, loan and lease fair values as of September 30, 2018 were estimated on an entrance price methodology, which discounts future cash flows using the then-current rates at which a similar loan would be made to borrowers with similar credit ratings and for the same remaining maturities. The fair value of non-impaired loans and leases as of June 30, 2019 and September 30, 2018 are not comparable.

FEDERAL HOME LOAN BANK (“FHLB”) STOCK

The fair value of FHLB stock is assumed to approximate book value since the Company is only able to redeem this stock at par value.

ACCRUED INTEREST RECEIVABLE

The carrying amount of accrued interest receivable is assumed to approximate the fair value.

DEPOSITS

The carrying values of noninterest-bearing checking deposits, interest-bearing checking deposits, savings, money markets, and wholesale non-maturing deposits are assumed to approximate fair value since deposits are immediately withdrawable without penalty. The fair value of time certificate deposits and wholesale certificate deposits are estimated using a discounted cash flows calculation that applies the FHLB Des Moines curve to aggregated expected maturities of time deposits. In accordance with Subtopic 825-10, Financial Instruments, no value has been assigned to the Company’s long-term relationships with its deposit customers (core value of deposits intangible) since such intangible is not a financial instrument as defined under Subtopic 825-10.

ADVANCES FROM FHLB

The fair value of such advances was estimated by discounting the expected future cash flows using current interest rates for advances with similar terms and remaining maturities.

FEDERAL FUNDS PURCHASED

The carrying amount of federal funds purchased is assumed to approximate the fair value.

SECURITIES SOLD UNDER AGREEMENTS TO REPURCHASE, SUBORDINATED DEBENTURES AND OTHER BORROWINGS

The fair value of these instruments was estimated by discounting the expected future cash flows using derived interest rates approximating market over the contractual maturity of such borrowings.

ACCRUED INTEREST PAYABLE

The carrying amount of accrued interest payable is assumed to approximate the fair value.

LIMITATIONS

Fair value estimates are made at a specific point in time and are based on relevant market information about the financial instrument.  Additionally, fair value estimates are based on existing on- and off-balance sheet financial instruments without attempting to estimate the value of anticipated future business, customer relationships and the value of assets and liabilities that are not considered financial instruments.  These estimates do not reflect any premium or discount that could result from offering the Company’s entire holdings of a particular financial instrument for sale at one time.  Furthermore, since no market exists for certain of the Company’s financial instruments, fair value estimates may be based on judgments regarding future expected loss experience, current economic conditions, risk characteristics of various financial instruments and other factors.  These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with a high level of precision.  Changes in assumptions as well as tax considerations could significantly affect the estimates.  Accordingly, based on the limitations described above, the aggregate fair value estimates are not intended to represent the underlying value of the Company, on either a going concern or a liquidation basis.

XML

SEGMENT REPORTING

9 Months Ended

Jun. 30, 2019

Segment Reporting [Abstract]

SSEGMENT REPORTING

SEGMENT REPORTING

An operating segment is generally defined as a component of a business for which discrete financial information is available and whose results are reviewed by the chief operating decision-maker. Operating segments are aggregated into reportable segments if certain criteria are met.

The Company reports its results of operations through the following three business segments: Payments, Banking, and Corporate Services/Other. The Meta Payment Systems and Tax Services divisions are reported in the Payments segment. The Community Banking, Commercial Finance and Consumer Finance divisions are reported in the Banking segment. Certain shared services, including the investment portfolio, wholesale deposits and borrowings, are included in the Corporate Services/Other segment.

The following tables present segment data for the Company for the three and nine months ended June 30, 2019 and 2018, respectively.

	Payments		Banking		Corporate Services/Other			Total
Three Months Ended June 30, 2019
Net interest income (expense)	$	15,232	$	60,043	$	(8,307	)	$	66,968
Provision for loan and lease losses	914		8,198		—			9,112
Noninterest income	28,402		13,583		1,805			43,790
Noninterest expense	17,559		33,233		21,676			72,468
Income (loss) before income tax expense (benefit)	25,161		32,195		(28,178		)	29,178
Total assets	196,257		4,169,351		1,735,464			6,101,072
Total goodwill	87,145		220,796		—			307,941
Total deposits	2,795,009		297,861		1,682,344			4,775,214

	Payments		Banking		Corporate Services/Other			Total
Nine Months Ended June 30, 2019
Net interest income (expense)	$	38,238	$	168,107	$	(7,755	)	$	198,590
Provision for loan and lease losses	24,883		26,646		—			51,529
Noninterest income	140,980		41,799		3,786			186,565
Noninterest expense	71,098		109,598		76,320			257,016
Income (loss) before income tax expense (benefit)	83,237		73,662		(80,289		)	76,610
Total assets	196,257		4,169,351		1,735,464			6,101,072
Total goodwill	87,145		220,796		—			307,941
Total deposits	2,795,009		297,861		1,682,344			4,775,214

	Payments		Banking		Corporate Services/Other			Total
Three Months Ended June 30, 2018
Net interest income	$	6,298	$	18,077	$	4,036		$	28,411
Provision for loan losses	1,189		4,126		—			5,315
Noninterest income	31,307		1,318		600			33,225
Noninterest expense	27,796		7,172		14,085			49,053
Income (loss) before income tax expense (benefit)	8,620		8,097		(9,449		)	7,268
Total assets	190,437		1,623,715		2,355,007			4,169,159
Total goodwill	87,145		11,578		—			98,723
Total deposits	2,641,838		241,572		638,223			3,521,633

	Payments		Banking		Corporate Services/Other			Total
Nine Months Ended June 30, 2018
Net interest income	$	15,900	$	49,794	$	16,318		$	82,012
Provision for loan losses	20,335		4,391		—			24,726
Noninterest income	155,082		4,044		786			159,912
Noninterest expense	99,592		20,723		41,277			161,592
Income (loss) before income tax expense (benefit)	51,055		28,724		(24,173		)	55,606
Total assets	190,437		1,623,715		2,355,007			4,169,159
Total goodwill	87,145		11,578		—			98,723
Total deposits	2,641,838		241,572		638,223			3,521,633

XML

SUBSEQUENT EVENTS

9 Months Ended

Jun. 30, 2019

Subsequent Events [Abstract]

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS

Management has evaluated subsequent events that occurred after June 30, 2019. During this period, up to the filing date, management did not identify any material subsequent events that would require recognition or disclosure in our consolidated financial statements as of or for the quarter ended June 30, 2019.

XML

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RECENTLY ADOPTED ACCOUNTING STANDARDS UPDATES ("ASU") (Policies)

9 Months Ended

Jun. 30, 2019

Accounting Policies [Abstract]

New Accounting Pronouncements, Policy

Adopted ASUs

Revenue Recognition - The Company adopted ASU 2014-09, Revenue from Contracts with Customers (Topic 606), subsequent related Updates (collectively, ASU 2014-09), and ASU 2016-04, Liabilities - Extinguishments of Liabilities (Subtopic 405-20): Recognition of Breakage of Certain Prepaid Stored-Value Products on October 1, 2018. ASU 2014-09 modifies the guidance used to recognize revenue from contracts with customers for transfers of goods or services and transfers of non-financial assets, unless those contracts are within the scope of other guidance. Upon adoption, the Company recorded a cumulative-effect adjustment of $1.5 million to retained earnings, net of tax, due to changes in timing of revenue recognition from breakage of unregistered, unused prepaid cards in the Company’s Meta Payment Systems (MPS) division. Refer to Note 13. Revenue from Contracts with Customers for additional information.

Financial Instruments - The Company adopted ASU 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Liabilities and related Updates (collectively, ASU 2016-01) on October 1, 2018. ASU 2016-01 makes several revisions to Subtopic 825-10, including that ASU 2016-01: (1) requires equity investments to be measured at fair value with changes in fair value recognized in net income, (2) simplifies impairment assessment of equity investments without readily determinable fair value, (3) eliminates requirement to disclose methods and significant assumptions used to estimate fair value of financial instruments measured at amortized cost, (4) requires the use of an exit price notion when measuring fair value of financial instruments for disclosure purposes, and (5) requires separate presentation of financial assets and liabilities by measurement category and form of financial asset on the balance sheet and accompanying notes. Upon adoption, the Company recorded a cumulative-effect adjustment that reclassed $0.5 million, net of tax, from accumulated other comprehensive income to retained earnings, due to the Company’s cumulative change in fair value of equity securities with readily determinable fair value. Refer to Note 6. Securities for additional information.

The Company also adopted the following ASUs on October 1, 2018, none of which had a material impact on the Company’s consolidated financial statements.

– ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments

– ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash

– ASU 2017-01, Clarifying the Definition of a Business

– ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment

– ASU 2017-05, Other Income - Gains and Losses from Derecognition of Non-Financial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and accounting for Partial Sales of Non-Financial Assets

–

ASU 2018-07, Compensation - Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting

XML

ACQUISITIONS (Tables)

9 Months Ended

Jun. 30, 2019

Business Combinations [Abstract]

Schedule of Purchase Price to Net Assets

The following table summarizes the allocation of the purchase price to net assets of Crestmark as of the August 1, 2018 acquisition date.

(Dollars in Thousands)	Estimated fair value as previously reported(a)		Measurement period adjustments			Fair value as adjusted
Rental Equipment	$	98,977	$	(3,355	)	$	95,622
Intangible assets	28,253		(117		)	28,136
Goodwill	204,547		4,671			209,218
Accrued expenses and other liabilities	88,301		1,199			89,500
Net other assets	55,464		—			55,464
Noncontrolling interest	3,167		—			3,167
Purchase price	295,773		—			295,773

^(a) As previously reported in the Company's Annual Report on Form 10-K for the fiscal year ended September 30, 2018

XML

LOANS AND LEASES, NET (Tables)

9 Months Ended

Jun. 30, 2019

Loans and Leases Receivable Disclosure [Abstract]

Schedule of Loans Receivable

Loans and leases at June 30, 2019 and September 30, 2018 were as follows:

	June 30, 2019			September 30, 2018
National Lending	(Dollars in Thousands)
Asset based lending	$	615,309		$	477,917
Factoring	320,344			284,221
Lease financing	341,957			265,315
Insurance premium finance	358,772			337,877
SBA/USDA	99,791			59,374
Other commercial finance	99,677			85,145
Commercial finance	1,835,850			1,509,849
Consumer credit products	155,539			80,605
Other consumer finance	164,727			189,756
Consumer finance(1)	320,266			270,361
Tax services	24,410			1,073
Warehouse finance(1)	250,003			65,000
Total National Lending	2,430,529			1,846,283
Community Banking
Commercial real estate and operating	877,412			790,890
Consumer one-to-four family real estate and other	256,853			247,318
Agricultural real estate and operating	61,169			60,498
Total Community Banking	1,195,434			1,098,706
Total gross loans and leases	3,625,963			2,944,989
Allowance for loan and lease losses	(43,505		)	(13,040		)
Net deferred loan origination fees (costs)	5,068			(250		)
Total loans and leases, net(2)	$	3,587,526		$	2,931,699

⁽¹⁾ Warehouse finance loans are presented in their own line. Previously these balances were included with consumer finance loans. Prior period balances have also been adjusted to reflect this change.

⁽²⁾ As of June 30, 2019, the remaining balance of acquired loans and leases from the Crestmark acquisition was $402.4 million and the remaining balances of the credit and interest rate mark discounts related to the acquired loans and leases held for investment were $6.8 million and $3.2 million, respectively, while the remaining balance of the interest rate mark premium related to the acquired loans held for sale was $0.7 million. On August 1, 2018, the Company acquired loans and leases from the Crestmark acquisition totaling $1.06 billion and recorded related credit and interest rate mark discounts of $12.3 million and $6.0 million, respectively.

Schedule of Loans Purchased and Sold by Portfolio Segment

Loans purchased and sold by portfolio segment, including participation interests, for the three and nine months ended June 30, 2019 and 2018 were as follows:

	Three Months Ended				Nine Months Ended
	June 30, 2019		June 30, 2018		June 30, 2019		June 30, 2018
Loans Purchased	(Dollars in Thousands)
Loans held for sale	$	6,703	$	—	$	12,643	$	—
Loans held for investment:
Total National Lending	72,737		—		198,328		72,751
Total Community Banking	2,710		6,183		21,223		22,418
Total purchases	82,150		6,183		232,194		95,169
Loans Sold
Loans held for sale	57,661		—		92,565		—
Loans held for investment:
Total Community Banking	2,212		10,379		13,069		19,961
Total sales	$	59,873	$	10,379	$	105,634	$	19,961

Sales-type Lease, Lease Income

The net investment in direct financing and sales-type leases was comprised of the following as of June 30, 2019 and September 30, 2018.

	June 30, 2019			September 30, 2018
	(Dollars in Thousands)
Minimum lease payments receivable	$	388,291		$	301,835
Estimated residual value of leased equipment	12,128			12,406
Unamortized initial direct costs	5,173			1,806
Premium on acquired leases	3			26
Unearned income	(58,450		)	(48,949		)
Net investment in direct financing and sales-type leases	$	347,145		$	267,124

Sales-type and Direct Financing Leases, Lease Receivable, Maturity

Future minimum lease payments receivable on noncancelable direct financing and sales-type leases were as follows as of June 30, 2019.

	As of June 30, 2019
	(Dollars in thousands)
Remaining in 2019	$	36,473
2020	129,577
2021	104,805
2022	67,262
2023	37,753
2024 and thereafter	12,421
Total	$	388,291

Annual Activity in Allowance for Loan Losses, Allowance for Loan Losses and Recorded Investment in Loans

Activity in the allowance for loan and lease losses and balances of loans and leases by portfolio segment for each of the three and nine months ended June 30, 2019 and 2018 was as follows:

Allowance for loan and lease losses:	Beginning balance		Provision (recovery) for loan and lease losses			Charge-offs			Recoveries		Ending balance
Three Months Ended June 30, 2019	(Dollars in Thousands)
National Lending
Asset based lending	$	3,499	$	2,685		$	(1,380	)	$	3	$	4,807
Factoring	1,761		2,747			(1,335		)	31		3,204
Lease financing	1,965		(13		)	(736		)	203		1,419
Insurance premium finance	919		201			(275		)	171		1,016
SBA/USDA	474		449			—			—		923
Other commercial finance	525		432			—			—		957
Commercial finance	9,143		6,501			(3,726		)	408		12,326
Consumer credit products	1,314		142			—			—		1,456
Other consumer finance	5,130		1,890			(1,398		)	28		5,650
Consumer finance	6,444		2,032			(1,398		)	28		7,106
Tax services	24,102		914			(9,627		)	36		15,425
Warehouse finance	185		65			—			—		250
Total National Lending	39,874		9,512			(14,751		)	472		35,107
Community Banking
Commercial real estate and operating	6,673		(249		)	—			—		6,424
Consumer one-to-four family real estate and other	958		(65		)	—			—		893
Agricultural real estate and operating	1,167		(86		)	—			—		1,081
Total Community Banking	8,798		(400		)	—			—		8,398
Total	$	48,672	$	9,112		$	(14,751	)	$	472	$	43,505

Allowance for loan and lease losses:	Beginning balance		Provision (recovery) for loan and lease losses			Charge-offs			Recoveries		Ending balance
Nine Months Ended June 30, 2019	(Dollars in Thousands)
National Lending
Asset based lending	$	107	$	6,213		$	(1,642	)	$	129	$	4,807
Factoring	64		5,769			(2,711		)	82		3,204
Lease financing	59		1,529			(2,198		)	2,029		1,419
Insurance premium finance	1,031		2,091			(2,359		)	253		1,016
SBA/USDA	13		910			—			—		923
Other commercial finance	28		929			—			—		957
Commercial finance	1,302		17,441			(8,910		)	2,493		12,326
Consumer credit products	785		671			—			—		1,456
Other consumer finance	2,820		8,249			(5,477		)	58		5,650
Consumer finance	3,605		8,920			(5,477		)	58		7,106
Tax services	—		24,883			(9,670		)	212		15,425
Warehouse finance	65		185			—			—		250
Total National Lending	4,972		51,429			(24,057		)	2,763		35,107
Community Banking
Commercial real estate and operating	6,220		204			—			—		6,424
Consumer one-to-four family real estate and other	632		281			(20		)	—		893
Agricultural real estate and operating	1,216		(385		)	—			250		1,081
Total Community Banking	8,068		100			(20		)	250		8,398
Total	$	13,040	$	51,529		$	(24,077	)	$	3,013	$	43,505

Allowance for loan and lease losses:	Beginning balance		Provision (recovery) for loan and lease losses			Charge-offs			Recoveries		Ending balance
Three Months Ended June 30, 2018	(Dollars in Thousands)
National Lending
Insurance premium finance	$	746	$	304		$	(243	)	$	99	$	906
Other commercial finance	4		8			—			—		12
Commercial finance	750		312			(243		)	99		918
Consumer credit products	—		264			—			—		264
Other consumer finance	—		3,000			—			—		3,000
Consumer finance	—		3,264			—			—		3,264
Tax services	19,573		1,189			(10,507		)	1		10,256
Total National Lending	20,323		4,765			(10,750		)	100		14,438
Community Banking
Commercial real estate and operating	4,100		687			—			—		4,787
Consumer one-to-four family real estate and other	901		(218		)	—			—		683
Agricultural real estate and operating	765		(51		)	—			207		921
Unallocated	989		132			—			—		1,121
Total Community Banking	6,755		550			—			207		7,512
Total	$	27,078	$	5,315		$	(10,750	)	$	307	$	21,950

Allowance for loan and lease losses:	Beginning balance		Provision (recovery) for loan and lease losses			Charge-offs			Recoveries		Ending balance
Nine Months Ended June 30, 2018	(Dollars in Thousands)
National Lending
Insurance premium finance	$	796	$	569		$	(711	)	$	252	$	906
Other commercial finance	4		8			—			—		12
Commercial finance	800		577			(711		)	252		918
Consumer credit products	—		264			—			—		264
Other consumer finance	—		3,000			—			—		3,000
Consumer finance	—		3,264			—			—		3,264
Tax services	5		20,335			(10,507		)	423		10,256
Total National Lending	805		24,176			(11,218		)	675		14,438
Community Banking
Commercial real estate and operating	2,820		1,967			—			—		4,787
Consumer one-to-four family real estate and other	809		(98		)	(31		)	3		683
Agricultural real estate and operating	2,574		(1,914		)	—			261		921
Unallocated	526		595			—			—		1,121
Total Community Banking	6,729		550			(31		)	264		7,512
Total	$	7,534	$	24,726		$	(11,249	)	$	939	$	21,950

The following tables provide details regarding the allowance for loan and lease losses and balance by type of allowance as of June 30, 2019 and September 30, 2018.

	Allowance						Loans and Leases
Recorded Investment	Ending balance: individually evaluated for impairment		Ending balance: collectively evaluated for impairment		Total		Ending balance: individually evaluated for impairment		Ending balance: collectively evaluated for impairment		Total
As of June 30, 2019	(Dollars in Thousands)
National Lending
Asset based lending	$	12	$	4,795	$	4,807	$	8,119	$	607,190	$	615,309
Factoring	255		2,949		3,204		7,795		312,549		320,344
Lease financing	—		1,419		1,419		5,455		336,502		341,957
Insurance premium finance	—		1,016		1,016		—		358,772		358,772
SBA/USDA	—		923		923		1,276		98,515		99,791
Other commercial finance	—		957		957		—		99,677		99,677
Commercial finance	267		12,059		12,326		22,645		1,813,205		1,835,850
Consumer credit products	—		1,456		1,456		—		155,539		155,539
Other consumer finance	—		5,650		5,650		1,039		163,688		164,727
Consumer finance	—		7,106		7,106		1,039		319,227		320,266
Tax services	—		15,425		15,425		—		24,410		24,410
Warehouse finance	—		250		250		—		250,003		250,003
Total National Lending	267		34,840		35,107		23,684		2,406,845		2,430,529
Community Banking
Commercial real estate and operating	—		6,424		6,424		319		877,093		877,412
Consumer one-to-four family real estate and other	—		893		893		290		256,563		256,853
Agricultural real estate and operating	—		1,081		1,081		1,237		59,932		61,169
Total Community Banking	—		8,398		8,398		1,846		1,193,588		1,195,434
Total	$	267	$	43,238	$	43,505	$	25,530	$	3,600,433	$	3,625,963

	Allowance						Loans and Leases
Recorded Investment	Ending balance: individually evaluated for impairment(1)		Ending balance: collectively evaluated for impairment(1)		Total		Ending balance: individually evaluated for impairment		Ending balance: collectively evaluated for impairment		Total
As of September 30, 2018	(Dollars in Thousands)
National Lending
Asset based lending	$	—	$	107	$	107	$	1,404	$	476,513	$	477,917
Factoring	—		64		64		3,331		280,890		284,221
Lease financing	—		59		59		8,877		256,438		265,315
Insurance premium finance	—		1,031		1,031		—		337,877		337,877
SBA/USDA	—		13		13		—		59,374		59,374
Other commercial finance	—		28		28		—		85,145		85,145
Commercial finance	—		1,302		1,302		13,612		1,496,237		1,509,849
Consumer credit products	—		785		785		—		80,605		80,605
Other consumer finance	—		2,820		2,820		—		189,756		189,756
Consumer finance	—		3,605		3,605		—		270,361		270,361
Tax services	—		—		—		—		1,073		1,073
Warehouse finance	—		65		65		—		65,000		65,000
Total National Lending	—		4,972		4,972		13,612		1,832,671		1,846,283
Community Banking
Commercial real estate and operating	—		6,220		6,220		451		790,439		790,890
Consumer one-to-four family real estate and other	—		632		632		94		247,224		247,318
Agricultural real estate and operating	—		1,216		1,216		1,454		59,044		60,498
Total Community Banking	—		8,068		8,068		1,999		1,096,707		1,098,706
Total	$	—	$	13,040	$	13,040	$	15,611	$	2,929,378	$	2,944,989

⁽¹⁾ Balances have been restated from what was previously reported as of September 30, 2018 on the Company's Annual Report on Form 10-K for its fiscal year ended September 30, 2018.

Asset Classification of Loans and Leases

The asset classification of loans and leases at June 30, 2019 and September 30, 2018 were as follows:

Asset Classification	Pass		Watch		Special Mention		Substandard		Total
June 30, 2019	(Dollars in Thousands)
National Lending
Asset based lending	$	539,623	$	—	$	67,567	$	8,119	$	615,309
Factoring	272,589		—		39,960		7,795		320,344
Lease financing	323,539		—		12,963		5,455		341,957
Insurance premium finance	358,772		—		—		—		358,772
SBA/USDA	90,110		—		8,405		1,276		99,791
Other commercial finance	99,108		—		569		—		99,677
Commercial finance	1,683,741		—		129,464		22,645		1,835,850
Consumer credit products	155,539		—		—		—		155,539
Other consumer finance	164,727		—		—		—		164,727
Consumer finance	320,266		—		—		—		320,266
Tax services	24,410		—		—		—		24,410
Warehouse finance	250,003		—		—		—		250,003
Total National Lending	2,278,420		—		129,464		22,645		2,430,529
Community Banking
Commercial real estate and operating	866,255		3,962		3,487		3,708		877,412
Consumer one-to-four family real estate and other	254,959		1,403		462		29		256,853
Agricultural real estate and operating	42,808		4,148		5,615		8,598		61,169
Total Community Banking	1,164,022		9,513		9,564		12,335		1,195,434
Total loans and leases	$	3,442,442	$	9,513	$	139,028	$	34,980	$	3,625,963

Asset Classification	Pass		Watch		Special Mention		Substandard		Total
September 30, 2018	(Dollars in Thousands)
National Lending
Asset based lending	$	418,635	$	—	$	57,877	$	1,405	$	477,917
Factoring	248,246		—		32,644		3,331		284,221
Lease financing	252,487		—		3,951		8,877		265,315
Insurance premium finance	336,296		—		1,581		—		337,877
SBA/USDA	39,093		—		20,281		—		59,374
Other commercial finance	85,145		—		—		—		85,145
Commercial finance	1,379,902		—		116,334		13,613		1,509,849
Consumer credit products	80,605		—		—		—		80,605
Other consumer finance	189,756		—		—		—		189,756
Consumer finance	270,361		—		—		—		270,361
Tax services	1,073		—		—		—		1,073
Warehouse finance	65,000		—		—		—		65,000
Total National Lending	1,716,336		—		116,334		13,613		1,846,283
Community Banking
Commercial real estate and operating	778,445		12,251		194		—		790,890
Consumer one-to-four family real estate and other	246,463		537		239		79		247,318
Agricultural real estate and operating	42,292		2,447		4,872		10,887		60,498
Total Community Banking	1,067,200		15,235		5,305		10,966		1,098,706
Total loans and leases	$	2,783,536	$	15,235	$	121,639	$	24,579	$	2,944,989

Past Due Loans and Leases

Past due loans and leases at June 30, 2019 and September 30, 2018 were as follows:

	Accruing and Non-accruing Loans and Leases												Non-performing Loans and Leases
Past Due Loans and Leases	30-59 Days Past Due		60-89 Days Past Due		> 89 Days Past Due		Total Past Due		Current		Total Loans and Leases Receivable		> 89 Days Past Due and Accruing		Non-accrual balance		Total
June 30, 2019	(Dollars in Thousands)
National Lending
Asset based lending	$	1,701	$	428	$	2,890	$	5,019	$	610,290	$	615,309	$	180	$	5,654	$	5,834
Factoring	—		—		20		20		320,324		320,344		—		4,846		4,846
Lease financing	2,080		1,816		5,408		9,304		332,653		341,957		4,225		1,936		6,161
Insurance premium finance	2,233		1,081		1,679		4,993		353,779		358,772		1,679		—		1,679
SBA/USDA	85		—		259		344		99,447		99,791		—		259		259
Other commercial finance	—		—		—		—		99,677		99,677		—		—		—
Commercial finance	6,099		3,325		10,256		19,680		1,816,170		1,835,850		6,084		12,695		18,779
Consumer credit products	1,454		1,039		703		3,196		152,343		155,539		703		—		703
Other consumer finance	996		614		1,083		2,693		162,034		164,727		1,083		—		1,083
Consumer finance	2,450		1,653		1,786		5,889		314,377		320,266		1,786		—		1,786
Tax services	—		24,410		—		24,410		—		24,410		—		—		—
Warehouse finance	—		—		—		—		250,003		250,003		—		—		—
Total National Lending	8,549		29,388		12,042		49,979		2,380,550		2,430,529		7,870		12,695		20,565
Community Banking
Commercial real estate and operating	—		—		—		—		877,412		877,412		—		—		—
Consumer one-to-four family real estate and other	54		36		233		323		256,530		256,853		—		233		233
Agricultural real estate and operating	1,745		—		—		1,745		59,424		61,169		—		—		—
Total Community Banking	1,799		36		233		2,068		1,193,366		1,195,434		—		233		233
Total Loans and Leases	$	10,348	$	29,424	$	12,275	$	52,047	$	3,573,916	$	3,625,963	$	7,870	$	12,928	$	20,798

	Accruing and Non-accruing Loans and Leases												Non-performing Loans and Leases
Past Due Loans and Leases	30-59 Days Past Due		60-89 Days Past Due		> 89 Days Past Due		Total Past Due		Current		Total Loans and Leases Receivable		> 89 Days Past Due and Accruing		Non-accrual balance		Total
September 30, 2018	(Dollars in Thousands)
National Lending
Asset based lending	$	1,235	$	2,151	$	94	$	3,480	$	474,437	$	477,917	$	94	$	—	$	94
Factoring	—		—		—		—		284,221		284,221		—		—		—
Lease financing	16,542		532		2,921		19,995		245,320		265,315		726		2,864		3,590
Insurance premium finance	1,864		1,019		2,981		5,864		332,013		337,877		2,981		—		2,981
SBA/USDA	1,067		—		—		1,067		58,307		59,374		—		—		—
Other commercial finance	—		—		—		—		85,145		85,145		—		—		—
Commercial finance	20,708		3,702		5,996		30,406		1,479,443		1,509,849		3,801		2,864		6,665
Consumer credit products	532		284		147		963		79,642		80,605		147		—		147
Other consumer finance	2,677		1,311		2,237		6,225		183,531		189,756		2,237		—		2,237
Consumer finance	3,209		1,595		2,384		7,188		263,173		270,361		2,384		—		2,384
Tax services	—		—		1,073		1,073		—		1,073		1,073		—		1,073
Warehouse finance	—		—		—		—		65,000		65,000		—		—		—
Total National Lending	23,917		5,297		9,453		38,667		1,807,616		1,846,283		7,258		2,864		10,122
Community Banking
Commercial real estate and operating	—		—		—		—		790,890		790,890		—		—		—
Consumer one-to-four family real estate and other	105		—		79		184		247,134		247,318		79		—		79
Agricultural real estate and operating	—		—		—		—		60,498		60,498		—		—		—
Total Community Banking	105		—		79		184		1,098,522		1,098,706		79		—		79
Total Loans and Leases	$	24,022	$	5,297	$	9,532	$	38,851	$	2,906,138	$	2,944,989	$	7,337	$	2,864	$	10,201

Impaired Loans and Leases

Impaired loans and leases at June 30, 2019 and September 30, 2018 were as follows:

June 30, 2019	Recorded Balance		Unpaid Principal Balance		Specific Allowance
Loans and leases without a specific valuation allowance	(Dollars in Thousands)
National Lending
Asset based lending	$	8,024	$	9,362	$	—
Factoring	3,580		4,655		—
Lease financing	5,455		5,455		—
SBA/USDA	1,276		1,276		—
Commercial finance	18,335		20,748		—
Other consumer finance	1,039		1,089		—
Consumer finance	1,039		1,089		—
Total National Lending	19,374		21,837		—
Community Banking
Commercial real estate and operating	319		319		—
Consumer one-to-four family real estate and other	290		290		—
Agricultural real estate and operating	1,237		1,237		—
Total Community Banking	1,846		1,846		—
Total	$	21,220	$	23,683	$	—
Loans and leases with a specific valuation allowance
National Lending
Asset based lending	$	95	$	107	$	12
Factoring	4,215		5,555		255
Commercial finance	4,310		5,662		267
Total National Lending	4,310		5,662		267
Total	$	4,310	$	5,662	$	267

September 30, 2018	Recorded Balance		Unpaid Principal Balance		Specific Allowance
Loans and leases without a specific valuation allowance	(Dollars in Thousands)
National Lending
Asset based lending	$	1,325	$	1,325	$	—
Factoring	1,383		1,713		—
Lease financing	5,491		5,491		—
Commercial finance	8,199		8,529		—
Total National Lending	8,199		8,529		—
Community Banking
Commercial real estate and operating	405		405		—
Consumer one-to-four family real estate and other	140		140		—
Agricultural real estate and operating	1,454		1,454		—
Total Community Banking	1,999		1,999		—
Total	$	10,198	$	10,528	$	—
Loans and leases with a specific valuation allowance
National Lending
Asset based lending	$	79	$	79	$	22
Factoring	1,948		2,198		49
Lease financing	3,386		3,386		517
Commercial finance	5,413		5,663		588
Total National Lending	5,413		5,663		588
Total	$	5,413	$	5,663	$	588

The following table provides the average recorded investment in impaired loans and leases for the three- and nine-month periods ended June 30, 2019 and 2018.

Three Months Ended June 30,	2019				2018
	Average Recorded Investment		Recognized Interest Income		Average Recorded Investment		Recognized Interest Income
	(Dollars in Thousands)
National Lending
Asset based lending	$	6,683	$	88	$	—	$	—
Factoring	6,621		—		—		—
Lease financing	3,351		—		—		—
SBA/USDA	425		—		—		—
Commercial finance	17,080		88		—		—
Other consumer finance	1,190		28		—		—
Consumer finance	1,190		28		—		—
Total National Lending	18,270		116		—		—
Community Banking
Commercial real estate and operating	106		5		604		4
Consumer one-to-four family real estate and other	186		1		342		2
Agricultural real estate and operating	1,226		28		2,670		42
Total Community Banking	1,518		34		3,616		48
Total loans and leases	$	19,788	$	150	$	3,616	$	48

Nine Months Ended June 30,	2019				2018
	Average Recorded Investment		Recognized Interest Income		Average Recorded Investment		Recognized Interest Income
	(Dollars in Thousands)
National Lending
Asset based lending	$	3,993	$	262	$	—	$	—
Factoring	4,178		5		—		—
Lease financing	5,012		17		—		—
SBA/USDA	142		—		—		—
Commercial finance	13,325		284		—		—
Other consumer finance	1,215		38		—		—
Consumer finance	1,215		38		—		—
Total National Lending	14,540		322		—		—
Community Banking
Commercial real estate and operating	259		9		761		14
Consumer one-to-four family real estate and other	154		3		224		11
Agricultural real estate and operating	1,371		63		1,567		106
Total Community Banking	1,784		75		2,552		131
Total loans and leases	$	16,324	$	397	$	2,552	$	131

XML

EARNINGS PER COMMON SHARE (Tables)

9 Months Ended

Jun. 30, 2019

Earnings Per Share [Abstract]

Reconciliation of Net Income and Common Stock Share Amounts Used in Computation of Basic and Diluted EPS

A reconciliation of net income and common stock share amounts used in the computation of basic and diluted earnings per share for the three and nine months ended June 30, 2019 and 2018 is presented below.

Three Months Ended June 30,	2019		2018
(Dollars in Thousands, Except Share and Per Share Data)
Basic income per common share:
Net income attributable to Meta Financial Group, Inc.	$	29,291	$	6,792
Weighted average common shares outstanding	38,903,266		29,099,472
Basic income per common share	0.75		0.23
Diluted income per common share:
Net income attributable to Meta Financial Group, Inc.	$	29,291	$	6,792
Weighted average common shares outstanding	38,903,266		29,099,472
Outstanding options - based upon the two-class method	74,424		119,508
Weighted average diluted common shares outstanding	38,977,690		29,218,980
Diluted income per common share	0.75		0.23

Nine Months Ended June 30,	2019		2018
(Dollars in Thousands, Except Share and Per Share Data)
Basic income per common share:
Net income attributable to Meta Financial Group, Inc.	$	76,809	$	42,898
Weighted average common shares outstanding	39,220,793		29,043,309
Basic income per common share	1.96		1.48
Diluted income per common share:
Net income attributable to Meta Financial Group, Inc.	$	76,809	$	42,898
Weighted average common shares outstanding	39,220,793		29,043,309
Outstanding options - based upon the two-class method	68,218		116,676
Weighted average diluted common shares outstanding	39,289,011		29,159,985
Diluted income per common share	1.95		1.47

XML

SECURITIES (Tables)

9 Months Ended

Jun. 30, 2019

Investments, Debt and Equity Securities [Abstract]

Securities Available for Sale

The amortized cost, gross unrealized gains and losses and estimated fair values of available for sale ("AFS") and held to maturity ("HTM") debt securities at June 30, 2019 and September 30, 2018 are presented below.

At June 30, 2019	AMORTIZED COST		GROSS UNREALIZED GAINS		GROSS UNREALIZED (LOSSES)			FAIR VALUE
	(Dollars in Thousands)
Debt securities AFS
SBA securities	$	189,816	$	3,271	$	(21	)	$	193,066
Obligations of states and political subdivisions	858		17		—			875
Non-bank qualified obligations of states and political subdivisions	459,551		3,456		(2,347		)	460,660
Asset-backed securities	308,711		753		(2,168		)	307,296
Mortgage-backed securities	395,059		2,838		(2,696		)	395,201
Total debt securities AFS	$	1,353,995	$	10,335	$	(7,232	)	$	1,357,098
Common equities and mutual funds(1)(2)	$	3,593	$	826	$	—		$	4,419

⁽¹⁾ Equity securities at fair value are included within other assets on the consolidated statement of financial condition at June 30, 2019 and September 30, 2018.

⁽²⁾ ASU 2016-01 adopted on October 1, 2018, on a prospective basis, removed equity securities from AFS category at June 30, 2019.

At September 30, 2018	AMORTIZED COST		GROSS UNREALIZED GAINS		GROSS UNREALIZED (LOSSES)			FAIR VALUE
	(Dollars in Thousands)
Debt securities AFS
SBA securities	$	45,591	$	1	$	(1,255	)	$	44,337
Obligations of states and political subdivisions	17,154		49		(293		)	16,910
Non-bank qualified obligations of states and political subdivisions	1,140,884		826		(31,825		)	1,109,885
Asset-backed securities	310,700		2,585		(257		)	313,028
Mortgage-backed securities	378,301		—		(14,236		)	364,065
Total debt securities AFS	$	1,892,630	$	3,461	$	(47,866	)	$	1,848,225
Common equities and mutual funds(1)	3,172		635		(7		)	3,800
Total AFS securities(1)	$	1,895,802	$	4,096	$	(47,873	)	$	1,852,025

⁽¹⁾ Equity securities at fair value are included within other assets on the consolidated statement of financial condition at June 30, 2019 and September 30, 2018.

Securities Held to Maturity

At June 30, 2019	AMORTIZED COST		GROSS UNREALIZED GAINS		GROSS UNREALIZED (LOSSES)			FAIR VALUE
	(Dollars in Thousands)
Debt securities HTM
Non-bank qualified obligations of states and political subdivisions	$	138,128	$	15	$	(2,500	)	$	135,643
Mortgage-backed securities	7,414		—		(119		)	7,295
Total held to maturity securities	$	145,542	$	15	$	(2,619	)	$	142,938

At September 30, 2018	AMORTIZED COST		GROSS UNREALIZED GAINS		GROSS UNREALIZED (LOSSES)			FAIR VALUE
	(Dollars in Thousands)
Debt securities HTM
Non-bank qualified obligations of states and political subdivisions	$	163,893	$	—	$	(10,758	)	$	153,135
Mortgage-backed securities	7,850		—		(422		)	7,428
Total held to maturity securities	$	171,743	$	—	$	(11,180	)	$	160,563

Debt Securities, Trading, and Equity Securities, FV-NI

Gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at June 30, 2019 and September 30, 2018, were as follows:

	LESS THAN 12 MONTHS					OVER 12 MONTHS					TOTAL
At June 30, 2019	Fair Value		Unrealized (Losses)			Fair Value		Unrealized (Losses)			Fair Value		Unrealized (Losses)
	(Dollars in Thousands)
Debt securities AFS
SBA securities	$	13,785	$	(21	)	$	—	$	—		$	13,785	$	(21	)
Obligations of states and political subdivisions	—		—			—		—			—		—
Non-bank qualified obligations of states and political subdivisions	—		—			230,117		(2,347		)	230,117		(2,347		)
Asset-backed securities	134,246		(1,230		)	62,450		(938		)	196,696		(2,168		)
Mortgage-backed securities	—		—			172,718		(2,696		)	172,718		(2,696		)
Total debt securities AFS	$	148,031	$	(1,251	)	$	465,285	$	(5,981	)	$	613,316	$	(7,232	)
Common equities and mutual funds(1)(2)	—		—			—		—			—		—

⁽¹⁾ Equity securities at fair value are included within other assets on the consolidated statement of financial condition at June 30, 2019 and September 30, 2018.

⁽²⁾ ASU 2016-01 adopted on October 1, 2018, on a prospective basis, removed equity securities from AFS category at June 30, 2019.

	LESS THAN 12 MONTHS					OVER 12 MONTHS					TOTAL
At September 30, 2018	Fair Value		Unrealized (Losses)			Fair Value		Unrealized (Losses)			Fair Value		Unrealized (Losses)
	(Dollars in Thousands)
Debt securities AFS
SBA securities	$	43,097	$	(1,255	)	$	—	$	—		$	43,097	$	(1,255	)
Obligations of state and political subdivisions	11,036		(279		)	881		(14		)	11,917		(293		)
Non-bank qualified obligations of states and political subdivisions	626,693		(13,539		)	358,095		(18,286		)	984,788		(31,825		)
Asset-backed securities	146,638		(257		)	—		—			146,638		(257		)
Mortgage-backed securities	121,217		(3,292		)	242,849		(10,944		)	364,066		(14,236		)
Total debt securities AFS	$	948,681	$	(18,622	)	$	601,825	$	(29,244	)	$	1,550,506	$	(47,866	)
Common equities and mutual funds(1)	1,818		(7		)	—		—			1,818		(7		)
Total debt AFS securities(1)	$	950,499	$	(18,629	)	$	601,825	$	(29,244	)	$	1,552,324	$	(47,873	)

⁽¹⁾Equity securities at fair value are included within other assets on the consolidated statement of financial condition at June 30, 2019 and September 30, 2018.

Schedule of Unrealized Loss on Investments

	LESS THAN 12 MONTHS				OVER 12 MONTHS					TOTAL
At June 30, 2019	Fair Value		Unrealized (Losses)		Fair Value		Unrealized (Losses)			Fair Value		Unrealized (Losses)
	(Dollars in Thousands)
Debt securities HTM
Non-bank qualified obligations of states and political subdivisions	$	—	$	—	$	129,424	$	(2,500	)	$	129,424	$	(2,500	)
Mortgage-backed securities	—		—		7,295		(119		)	7,295		(119		)
Total held to maturity securities	$	—	$	—	$	136,719	$	(2,619	)	$	136,719	$	(2,619	)

	LESS THAN 12 MONTHS					OVER 12 MONTHS					TOTAL
At September 30, 2018	Fair Value		Unrealized (Losses)			Fair Value		Unrealized (Losses)			Fair Value		Unrealized (Losses)
	(Dollars in Thousands)
Debt securities HTM
Non-bank qualified obligations of states and political subdivisions	$	5,767	$	(287	)	$	147,368	$	(10,471	)	$	153,135	$	(10,758	)
Mortgage-backed securities	—		—			7,428		(422		)	7,428		(422		)
Total held to maturity securities	$	5,767	$	(287	)	$	154,796	$	(10,893	)	$	160,563	$	(11,180	)

Amortized Cost and Fair Value of Debt Securities by Contractual Maturity

The amortized cost and fair value of debt securities by contractual maturity as of the dates set forth below are shown below.  Certain securities have call features which allow the issuer to call the security prior to maturity.  Expected maturities may differ from contractual maturities in mortgage-backed securities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.  Therefore, mortgage-backed securities are not included in the maturity categories in the following maturity summary.  The expected maturities of certain housing related municipal securities, SBA and asset-backed securities may differ from contractual maturities because the borrowers may have the right to prepay the obligation. However, certain prepayment penalties may apply.

AFS Securities at Fair Value	AMORTIZED COST		FAIR VALUE
At June 30, 2019	(Dollars in Thousands)
Due in one year or less	$	—	$	—
Due after one year through five years	11,336		11,711
Due after five years through ten years	62,337		64,221
Due after ten years	885,263		885,965
	958,936		961,897
Mortgage-backed securities	395,059		395,201
Total securities at fair value	$	1,353,995	$	1,357,098

	AMORTIZED COST		FAIR VALUE
At September 30, 2018	(Dollars in Thousands)
Due in one year or less	$	2,532	$	2,529
Due after one year through five years	41,415		41,504
Due after five years through ten years	352,099		350,143
Due after ten years	1,118,283		1,089,984
	1,514,329		1,484,160
Mortgage-backed securities	378,301		364,065
Common equities and mutual funds(1)	3,172		3,800
Total securities at fair value	$	1,895,802	$	1,852,025

⁽¹⁾Equity securities at fair value are included within other assets on the consolidated statement of financial condition at June 30, 2019 and September 30, 2018.

HTM Securities at Fair Value	AMORTIZED COST		FAIR VALUE
At June 30, 2019	(Dollars in Thousands)
Due after ten years	$	138,128	$	135,643
	138,128		135,643
Mortgage-backed securities	7,414		7,295
Total held to maturity securities at cost	$	145,542	$	142,938

	AMORTIZED COST		FAIR VALUE
At September 30, 2018	(Dollars in Thousands)
Due after ten years	$	163,893	$	153,135
	163,893		153,135
Mortgage-backed securities	7,850		7,428
Total held to maturity securities at cost	$	171,743	$	160,563

XML

RENTAL EQUIPMENT, NET (Tables)

9 Months Ended

Jun. 30, 2019

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment

Rental equipment was as follows as of June 30, 2019 and September 30, 2018.

	June 30, 2019			September 30, 2018
	(Dollars in thousands)
Computers and IT networking equipment	$	38,360		$	53,035
Motor vehicles and other	56,359			43,505
Office furniture and equipment	3,233			3,590
Solar panels and equipment	140,532			57,242
Total	238,484			157,372
Accumulated depreciation	(53,752		)	(50,082		)
Net book value	$	184,732		$	107,290

Schedule of Future Minimum Rental Payments for Operating Leases

Future minimum lease payments receivable on equipment under operating leases was as follows as of June 30, 2019.

	June 30, 2019
	(Dollars in thousands)
Remaining in 2019	$	7,829
2020	26,938
2021	22,527
2022	15,911
2023	13,516
2024 and thereafter	28,309
Total	$	115,030

XML

GOODWILL AND INTANGIBLE ASSETS (Tables)

9 Months Ended

Jun. 30, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Goodwill

The changes in the carrying amount of the Company’s goodwill and intangible assets for the nine months ended June 30, 2019 and 2018 were as follows:

	Payments		Banking		Corporate Services/Other		Total
Goodwill	(Dollars in Thousands)
September 30, 2018	$	87,145	$	216,125	$	—	$	303,270
Acquisitions	—		—		—		—
Measurement Period Adjustments (1)	—		4,671		—		4,671
Impairment	—		—		—		—
June 30, 2019	$	87,145	$	220,796	$	—	$	307,941
September 30, 2017	$	87,145	$	11,578	$	—	$	98,723
Acquisitions	—		—		—		—
Impairment	—		—		—		—
June 30, 2018	$	87,145	$	11,578	$	—	$	98,723

⁽¹⁾ The Company recognized measurement period adjustments on provisional goodwill during the second and third fiscal quarters of 2019 related to the Crestmark acquisition. Refer to Note 3. Acquisitions.

Schedule of Finite-Lived Intangible Assets

	Trademark(1)			Non-Compete(2)			Customer Relationships(3)			All Others(4)			Total
Intangibles	(Dollars in Thousands)
Balance as of September 30, 2018	$	12,987		$	1,297		$	48,455		$	7,980		$	70,719
Acquisitions during the period	—			—			—			100			100
Amortization during the period	(771		)	(353		)	(12,504		)	(724		)	(14,352		)
Write-offs during the period	—			—			—			(314		)	(314		)
Balance as of June 30, 2019	$	12,216		$	944		$	35,951		$	7,042		$	56,153
Gross carrying amount	$	14,624		$	2,480		$	82,088		$	10,688		$	109,880
Accumulated amortization	(2,408		)	(1,536		)	(35,889		)	(2,987		)	(42,820		)
Accumulated impairment	—			—			(10,248		)	(659		)	(10,907		)
Balance as of June 30, 2019	$	12,216		$	944		$	35,951		$	7,042		$	56,153

⁽¹⁾ Book amortization period of 5-15 years. Amortized using the straight line and accelerated methods.

⁽²⁾ Book amortization period of 3-5 years. Amortized using the straight line method.

⁽³⁾ Book amortization period of 10-30 years. Amortized using the accelerated method.

⁽⁴⁾ Book amortization period of 3-20 years. Amortized using the straight line method.

	Trademark(1)			Non-Compete(2)			Customer Relationships(3)			All Others(4)			Total
Intangibles	(Dollars in Thousands)
Balance as of September 30, 2017	$	10,051		$	1,782		$	31,707		$	8,638		$	52,178
Acquisitions during the period	—			—			—			85			85
Amortization during the period	(477		)	(367		)	(4,548		)	(685		)	(6,077		)
Write-offs during the period	—			—			—			(88		)	(88		)
Balance as of June 30, 2018	$	9,574		$	1,415		$	27,159		$	7,950		$	46,098
Gross carrying amount	$	10,990		$	2,480		$	57,810		$	10,587		$	81,867
Accumulated amortization	(1,416		)	(1,065		)	(20,403		)	(2,020		)	(24,904		)
Accumulated impairment	—			—			(10,248		)	(617		)	(10,865		)
Balance as of June 30, 2018	$	9,574		$	1,415		$	27,159		$	7,950		$	46,098

⁽¹⁾ Book amortization period of 15 years. Amortized using the straight line and accelerated methods.

⁽²⁾ Book amortization period of 3 years. Amortized using the straight line method.

⁽³⁾ Book amortization period of 10-30 years. Amortized using the accelerated method.

⁽⁴⁾ Book amortization period of 3-20 years. Amortized using the straight line method.

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense

Estimated amortization expense of intangible assets in the remaining three months of fiscal 2019 and subsequent fiscal years is as follows:

	(Dollars in Thousands)
Remaining in 2019	$	3,357
2020	10,986
2021	8,527
2022	6,402
2023	5,084
2024	4,367
Thereafter	17,430
Total anticipated intangible amortization	$	56,153

XML

STOCK COMPENSATION (Tables)

9 Months Ended

Jun. 30, 2019

Share-based Payment Arrangement [Abstract]

Activity of Options

The following tables show the activity of options and nonvested (restricted) shares granted, exercised, or forfeited under the 2002 Omnibus Incentive Plan for the nine months ended June 30, 2019:

	Number of Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Yrs)	Aggregate Intrinsic Value
	(Dollars in Thousands, Except Per Share Data (1))
Options outstanding, September 30, 2018	155,961		$	8.48	1.78	$	2,974
Granted	—		—		—	—
Exercised	(48,678	)	9.07		—	802
Forfeited or expired	(3,027	)	10.60		—	33
Options outstanding, June 30, 2019	104,256		$	8.14	1.22	$	2,075
Options exercisable, June 30, 2019	104,256		$	8.14	1.22	$	2,075

Schedule of Nonvested Share Activity

	Number of Shares		Weighted Average Fair Value at Grant
(Dollars in Thousands, Except Per Share Data (1))
Nonvested (restricted) shares outstanding, September 30, 2018	1,005,813		$	29.89
Granted	296,302		24.84
Vested	(352,218	)	26.77
Forfeited or expired	(2,679	)	26.14
Nonvested (restricted) shares outstanding, June 30, 2019	947,218		$	29.48

⁽¹⁾ All share and per share data has been adjusted to reflect the 3-for-1 forward stock split effected by the Company on October 4, 2018.

XML

INCOME TAXES (Tables)

9 Months Ended

Jun. 30, 2019

Income Tax Disclosure [Abstract]

Schedule of Effective Income Tax Rate Reconciliation

The Company’s effective tax rate in the future will depend in part on actual investment tax credits earned as part of its financing of solar energy projects.

The table below compares the income tax expense components for the periods presented.

Nine Months Ended June 30,	2019			2018
(Dollars in Thousands)
Provision at statutory rate	$	15,449		$	13,639
Tax-exempt income	(2,360		)	(5,506		)
State income taxes	3,243			2,314
Interim period effective rate adjustment	1,397			(1,070		)
Tax credit investments, net - federal	(22,484		)	—
Tax Reform rate adjustment	—			3,635
IRC 162(m) nondeductible compensation	1,612			—
Other, net	(101		)	(304		)
Income tax expense	$	(3,244	)	$	12,708
Effective tax rate	(4.2		%)	22.9		%

XML

REVENUE FROM CONTRACTS WITH CUSTOMERS (Tables)

9 Months Ended

Jun. 30, 2019

Revenue from Contract with Customer [Abstract]

Schedule of Revenue by Major Customers by Reporting Segments

The table below presents the Company’s revenue by operating segment. For additional descriptions of the Company’s operating segments, including additional financial information and the underlying management accounting process, see Note 15. Segment Reporting to the Consolidated Financial Statements.

(Dollars in thousands)	Payments					Banking				Corporate Services/Other						Consolidated Company
Three Months Ended June 30,	2019		2018			2019		2018		2019			2018			2019		2018
Net interest income(1)	$	15,232	$	6,298		$	60,043	$	18,077	$	(8,307	)	$	4,036		$	66,968	$	28,411
Noninterest income:
Refund transfer product fees	6,697		7,358			—		—		—			—			6,697		7,358
Tax advance product fees(1)	34		(46		)	—		—		—			—			34		(46		)
Card fees	19,445		22,717			92		90		—			—			19,537		22,807
Rental income(1)	4		—			9,382		—		—			—			9,386		—
Loan and lease fees(1)	—		—			1,012		1,111		—			—			1,012		1,111
Bank-owned life insurance(1)	—		—			—		—		628			633			628		633
Deposit fees	1,932		1,027			403		107		—			—			2,335		1,134
Gain (loss) on sale of securities available-for-sale, net(1)	—		—			—		—		440			(22		)	440		(22		)
Gain on sale of loans and leases(1)	—		—			1,913		—		—			—			1,913		—
Other income(1)	290		251			781		10		737			(11		)	1,808		250
Total noninterest income	28,402		31,307			13,583		1,318		1,805			600			43,790		33,225
Revenue	$	43,634	$	37,605		$	73,626	$	19,395	$	(6,502	)	$	4,636		$	110,758	$	61,636

⁽¹⁾ These revenues are not within the scope of Topic 606. Additional details are included in other footnotes to the accompanying financial statements. The scope of Topic 606 explicitly excludes net interest income as well as many other revenues for financial assets and liabilities, including loans, leases, and securities.

(Dollars in thousands)	Payments				Banking						Corporate Services/Other						Consolidated Company
Nine Months Ended June 30,	2019		2018		2019			2018			2019			2018			2019			2018
Net interest income(1)	$	38,238	$	15,900	$	168,107		$	49,794		$	(7,755	)	$	16,318		$	198,590		$	82,012
Noninterest income:
Refund transfer product fees	38,559		41,353		—			—			—			—			38,559			41,353
Tax advance product fees(1)	34,757		35,739		—			—			—			—			34,757			35,739
Card fees	61,678		74,662		261			248			—			—			61,939			74,910
Rental income(1)	5		—		30,162			—			—			—			30,167			—
Loan and lease fees(1)	—		—		3,185			3,445			—			—			3,185			3,445
Bank-owned life insurance(1)	—		—		—			—			1,901			1,952			1,901			1,952
Deposit fees	5,177		2,634		1,188			330			—			—			6,365			2,964
Gain (loss) on sale of securities available-for-sale, net(1)	—		—		—			—			649			(1,198		)	649			(1,198		)
Gain on sale of loans and leases(1)	—		—		3,865			—			—			—			3,865			—
Loss on foreclosed real estate(1)	—		—		(185		)	(19		)	—			—			(185		)	(19		)
Other income(1)	804		694		3,323			40			1,236			32			5,363			766
Total noninterest income	140,980		155,082		41,799			4,044			3,786			786			186,565			159,912
Revenue	$	179,218	$	170,982	$	209,906		$	53,838		$	(3,969	)	$	17,104		$	385,155		$	241,924

⁽¹⁾ These revenues are not within the scope of Topic 606. Additional details are included in other footnotes to the accompanying financial statements. The scope of Topic 606 explicitly excludes net interest income as well as many other revenues for financial assets and liabilities, including loans, leases, and securities.

XML

FAIR VALUE MEASUREMENTS (Tables)

9 Months Ended

Jun. 30, 2019

Fair Value Disclosures [Abstract]

Summary of Fair Values of Securities Available for Sale and Held to Maturity

The following table summarizes the fair values of debt securities available for sale and equity securities at June 30, 2019 and September 30, 2018, as they are measured at fair value on a recurring basis.

	Fair Value At June 30, 2019
(Dollars in Thousands)	Total		Level 1		Level 2		Level 3
Debt securities AFS
SBA securities	$	193,066	$	—	$	193,066	$	—
Obligations of states and political subdivisions	875		—		875		—
Non-bank qualified obligations of states and political subdivisions	460,660		—		460,660		—
Asset-backed securities	307,296		—		307,296		—
Mortgage-backed securities	395,201		—		395,201		—
Total debt securities AFS	$	1,357,098	$	—	$	1,357,098	$	—
Common equities and mutual funds(1)(2)	$	4,419	$	4,419	$	—	$	—

⁽¹⁾ Equity securities at fair value are included within other assets on the consolidated statement of financial condition at June 30, 2019 and September 30, 2018.

⁽²⁾ ASU 2016-01 adopted on October 1, 2018, on a prospective basis, removed equity securities from AFS category at June 30, 2019.

	Fair Value At September 30, 2018
(Dollars in Thousands)	Total		Level 1		Level 2		Level 3
Debt securities AFS
SBA securities	$	44,337	$	—	$	44,337	$	—
Obligations of states and political subdivisions	16,910		—		16,910		—
Non-bank qualified obligations of states and political subdivisions	1,109,885		—		1,109,885		—
Asset-backed securities	313,028		—		313,028		—
Mortgage-backed securities	364,065		—		364,065		—
Total debt securities AFS	1,848,225		—		1,848,225		—
Common equities and mutual funds(1)	3,800		3,800		—		—
Total securities	$	1,852,025	$	3,800	$	1,848,225	$	—

⁽¹⁾ Equity securities at fair value are included within other assets on the consolidated statement of financial condition at June 30, 2019 and September 30, 2018.

Assets Measured at Fair Value on Nonrecurring Basis

The following table summarizes the assets of the Company that were measured at fair value in the consolidated statements of financial condition on a non-recurring basis as of June 30, 2019 and September 30, 2018.

	Fair Value At June 30, 2019
(Dollars in Thousands)	Total		Level 1		Level 2		Level 3
Impaired Loans and Leases, net
Asset based lending	$	83	$	—	$	—	$	83
Factoring	3,960		—		—		3,960
Commercial finance	4,043		—		—		4,043
Total National Lending	4,043		—		—		4,043
Total impaired loans and leases	4,043		—		—		4,043
Foreclosed assets, net	29,514		—		—		29,514
Total	$	33,557	$	—	$	—	$	33,557

	Fair Value At September 30, 2018
(Dollars in Thousands)	Total		Level 1		Level 2		Level 3
Impaired loans and leases, net
Asset based lending	$	57	$	—	$	—	$	57
Factoring	1,899		—		—		1,899
Lease financing	2,869		—		—		2,869
Commercial finance	4,825		—		—		4,825
Total National Lending	4,825		—		—		4,825
Total impaired loans and leases	4,825		—		—		4,825
Foreclosed assets, net	31,638		—		—		31,638
Total	$	36,463	$	—	$	—	$	36,463

Quantitative Information about Level 3 Fair Value Measurements

	Quantitative Information About Level 3 Fair Value Measurements
(Dollars in Thousands)	Fair Value at June 30, 2019		Fair Value at September 30, 2018	Valuation Technique	Unobservable Input	Range of Inputs
Impaired loans and leases, net	$	4,043	4,825	Market approach	Appraised values(1)	4.00 - 10.00%
Foreclosed assets, net	$	29,514	31,638	Market approach	Appraised values(1)	4.00 - 30.00%

⁽¹⁾ The Company generally relies on external appraisers to develop this information. Management reduced the appraised value by estimating selling costs and other inputs in a range of 4% to 30%.

Carrying Amount and Estimated Fair Value of Financial Instruments

The following presents the carrying amount and estimated fair value of the financial instruments held by the Company at June 30, 2019 and September 30, 2018.

	June 30, 2019
(Dollars in Thousands)	Carrying Amount		Estimated Fair Value		Level 1		Level 2		Level 3
Financial assets
Cash and cash equivalents	$	100,732	$	100,732	$	100,732	$	—	$	—
Debt securities available for sale	1,357,098		1,357,098		—		1,357,098		—
Debt securities held to maturity	145,542		142,938		—		142,938		—
Equity securities(1)	4,419		4,419		4,419		—		—
Total securities	1,507,059		1,504,455		4,419		1,500,036		—
Loans held for sale	62,839		62,839		—		62,839		—
Loans and leases:
Asset based lending	615,309		599,664		—		—		599,664
Factoring	320,344		316,278		—		—		316,278
Lease financing	341,957		338,804		—		—		338,804
Insurance premium finance	358,772		358,401		—		—		358,401
SBA/USDA	99,791		94,391		—		—		94,391
Other commercial finance	99,677		101,145		—		—		101,145
Commercial finance	1,835,850		1,808,683		—		—		1,808,683
Consumer credit products	155,539		156,539		—		—		156,539
Other consumer finance	164,727		160,239		—		—		160,239
Consumer finance	320,266		316,778		—		—		316,778
Tax services	24,410		8,985		—		—		8,985
Warehouse finance	250,003		250,053		—		—		250,053
Total National Lending	2,430,529		2,384,499		—		—		2,384,499
Commercial real estate and operating	877,412		867,725		—		—		867,725
Consumer one to four family real estate and other	256,853		258,359		—		—		258,359
Agricultural real estate and operating	61,169		59,270		—		—		59,270
Total Community Banking	1,195,434		1,185,354		—		—		1,185,354
Total loans and leases	3,625,963		3,569,853		—		—		3,569,853
Federal Home Loan Bank stock	17,236		17,236		—		17,236		—
Accrued interest receivable	19,722		19,722		19,722		—		—
Financial liabilities
Noninterest-bearing demand deposits	2,751,931		2,751,931		2,751,931		—		—
Interest-bearing demand deposits, savings, and money markets	278,585		278,585		278,585		—		—
Time certificates of deposits	116,698		116,657		—		116,657		—
Wholesale non-maturing deposits	216,598		216,598		216,598		—		—
Wholesale time certificates of deposits	1,411,402		1,412,931		—		1,412,931		—
Total deposits	4,775,214		4,776,702		3,247,114		1,529,588		—
Overnight federal funds purchased	135,000		135,000		135,000		—		—
Long-term Federal Home Loan Bank advances	110,000		110,578		—		110,578		—
Securities sold under agreements to repurchase	3,658		3,658		—		3,658		—
Capital leases	1,972		1,972		—		1,972		—
Trust preferred securities	13,661		13,879		—		13,879		—
Subordinated debentures	73,605		76,875		—		76,875		—
Other borrowings	18,482		18,307		—		18,307		—
Accrued interest payable	12,350		12,350		12,350		—		—

⁽¹⁾ Equity securities at fair value are included within other assets on the consolidated statement of financial condition at June 30, 2019 and September 30, 2018.

	September 30, 2018
(Dollars in Thousands)	Carrying Amount		Estimated Fair Value		Level 1		Level 2		Level 3
Financial assets
Cash and cash equivalents	$	99,977	$	99,977	$	99,977	$	—	$	—
Securities available for sale	1,852,025		1,852,025		3,800		1,848,225		—
Securities held to maturity	172,154		160,974		—		160,974		—
Total securities	2,024,179		2,012,999		3,800		2,009,199		—
Loans held for sale	15,606		15,606		—		15,606		—
Loans and leases:
Asset based lending	477,917		477,471		—		—		477,471
Factoring	284,221		283,424		—		—		283,424
Lease financing	265,315		264,679		—		—		264,679
Insurance premium finance	337,877		337,212		—		—		337,212
SBA/USDA	59,374		61,072		—		—		61,072
Other commercial finance	85,145		83,111		—		—		83,111
Commercial finance	1,509,849		1,506,969		—		—		1,506,969
Consumer credit products	80,605		80,633		—		—		80,633
Other consumer finance	189,756		197,320		—		—		197,320
Consumer finance	270,361		277,953		—		—		277,953
Tax services	1,073		1,073		—		—		1,073
Warehouse finance	65,000		64,978		—		—		64,978
Total National Lending	1,846,283		1,850,973		—		—		1,850,973
Commercial real estate and operating	790,890		773,203		—		—		773,203
Consumer one to four family real estate and other	247,318		244,730		—		—		244,730
Agricultural real estate and operating	60,498		58,849		—		—		58,849
Total Community Banking	1,098,706		1,076,782		—		—		1,076,782
Total loans and leases	2,944,989		2,927,755		—		—		2,927,755
Federal Home Loan Bank stock	23,400		23,400		—		23,400		—
Accrued interest receivable	22,016		22,016		22,016		—		—
Financial liabilities
Noninterest-bearing demand deposits	2,405,274		2,405,274		2,405,274		—		—
Interest-bearing demand deposits, savings, and money markets	218,347		218,347		218,347		—		—
Time certificates of deposits	276,180		273,800		—		273,800		—
Wholesale non-maturing deposits	94,384		94,384		94,384		—		—
Wholesale time certificates of deposits	1,436,802		1,432,146		—		1,432,146		—
Total deposits	4,430,987		4,423,951		2,718,005		1,705,946		—
Overnight federal funds purchased	422,000		422,000		422,000		—		—
Securities sold under agreements to repurchase	3,694		3,694		—		3,694		—
Capital leases	1,876		1,876		—		1,876		—
Trust preferred securities	13,661		13,866		—		13,866		—
Subordinated debentures	73,491		75,563		—		75,563		—
Accrued interest payable	7,794		7,794		7,794		—		—

XML

SEGMENT REPORTING (Tables)

9 Months Ended

Jun. 30, 2019

Segment Reporting [Abstract]

Segment Information of Entity

The following tables present segment data for the Company for the three and nine months ended June 30, 2019 and 2018, respectively.

	Payments		Banking		Corporate Services/Other			Total
Three Months Ended June 30, 2019
Net interest income (expense)	$	15,232	$	60,043	$	(8,307	)	$	66,968
Provision for loan and lease losses	914		8,198		—			9,112
Noninterest income	28,402		13,583		1,805			43,790
Noninterest expense	17,559		33,233		21,676			72,468
Income (loss) before income tax expense (benefit)	25,161		32,195		(28,178		)	29,178
Total assets	196,257		4,169,351		1,735,464			6,101,072
Total goodwill	87,145		220,796		—			307,941
Total deposits	2,795,009		297,861		1,682,344			4,775,214

	Payments		Banking		Corporate Services/Other			Total
Nine Months Ended June 30, 2019
Net interest income (expense)	$	38,238	$	168,107	$	(7,755	)	$	198,590
Provision for loan and lease losses	24,883		26,646		—			51,529
Noninterest income	140,980		41,799		3,786			186,565
Noninterest expense	71,098		109,598		76,320			257,016
Income (loss) before income tax expense (benefit)	83,237		73,662		(80,289		)	76,610
Total assets	196,257		4,169,351		1,735,464			6,101,072
Total goodwill	87,145		220,796		—			307,941
Total deposits	2,795,009		297,861		1,682,344			4,775,214

	Payments		Banking		Corporate Services/Other			Total
Three Months Ended June 30, 2018
Net interest income	$	6,298	$	18,077	$	4,036		$	28,411
Provision for loan losses	1,189		4,126		—			5,315
Noninterest income	31,307		1,318		600			33,225
Noninterest expense	27,796		7,172		14,085			49,053
Income (loss) before income tax expense (benefit)	8,620		8,097		(9,449		)	7,268
Total assets	190,437		1,623,715		2,355,007			4,169,159
Total goodwill	87,145		11,578		—			98,723
Total deposits	2,641,838		241,572		638,223			3,521,633

	Payments		Banking		Corporate Services/Other			Total
Nine Months Ended June 30, 2018
Net interest income	$	15,900	$	49,794	$	16,318		$	82,012
Provision for loan losses	20,335		4,391		—			24,726
Noninterest income	155,082		4,044		786			159,912
Noninterest expense	99,592		20,723		41,277			161,592
Income (loss) before income tax expense (benefit)	51,055		28,724		(24,173		)	55,606
Total assets	190,437		1,623,715		2,355,007			4,169,159
Total goodwill	87,145		11,578		—			98,723
Total deposits	2,641,838		241,572		638,223			3,521,633

XML

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RECENTLY ADOPTED ACCOUNTING STANDARDS UPDATES ("ASU") (Details) $ in Thousands	Oct. 01, 2018 USD ($)
Accounting Standards Update 2014-09
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Adoption of accounting standards update	$ 1,502
Retained Earnings | Accounting Standards Update 2014-09
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Adoption of accounting standards update	1,502
Retained Earnings | Accounting Standards Update 2016-01
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Adoption of accounting standards update	$ 475

XML

ACQUISTIONS - Narrative (Details) $ in Thousands		3 Months Ended		9 Months Ended
	Aug. 01, 2018 USD ($) shares	Jun. 30, 2019 USD ($)	Mar. 31, 2019 USD ($)	Jun. 30, 2019 USD ($) repossessed_assets	Sep. 30, 2018 USD ($)	Jun. 30, 2018 USD ($)	Sep. 30, 2017 USD ($)
Business Acquisition [Line Items]
Number of assets repossessed | repossessed_assets				173
Number of assets in underlying asset class, identified for repossession | repossessed_assets				176
Goodwill		$ 307,941		$ 307,941	$ 303,270	$ 98,723	$ 98,723
Crestmark Bancorp, Inc.
Business Acquisition [Line Items]
Total consideration paid	$ 295,800
Equity interest issued (in shares) | shares	9,919,512
Receivables acquired		402,400		402,400
Goodwill	$ 204,547	209,218		209,218
DC Solar
Business Acquisition [Line Items]
Goodwill, period increase (decrease)		$ 2,200
Stockholders' Equity, Total | DC Solar
Business Acquisition [Line Items]
Goodwill, period increase (decrease)				$ (6,600)
Other Regulatory Assets (Liabilities) | DC Solar
Business Acquisition [Line Items]
Goodwill, period increase (decrease)			$ (8,500)

XML

LOANS AND LEASES, NET - Summary of Loans (Details) - USD ($) $ in Thousands	Jun. 30, 2019	Sep. 30, 2018	Aug. 01, 2018	Jun. 30, 2018
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans receivable	$ 3,625,963	$ 2,944,989
Allowance for loan and lease losses	(43,505)	(13,040)
Net deferred loan origination fees	5,068	(250)
Total loans and leases, net	3,587,526	2,931,699
Interest rate mark discounts				$ 700
Financing Receivable | Asset based lending
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans receivable	615,309	477,917
Financing Receivable | Factoring
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans receivable	320,344	284,221
Financing Receivable | Lease financing
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans receivable	341,957	265,315
Financing Receivable | Insurance premium finance
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans receivable	358,772	337,877
Financing Receivable | SBA/USDA
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans receivable	99,791	59,374
Financing Receivable | Other commercial finance
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans receivable	99,677	85,145
Financing Receivable | Commercial finance
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans receivable	1,835,850	1,509,849
Financing Receivable | Consumer credit products
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans receivable	155,539	80,605
Financing Receivable | Other consumer finance
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans receivable	164,727	189,756
Financing Receivable | Consumer finance
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans receivable	320,266	270,361
Financing Receivable | Tax services
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans receivable	24,410	1,073
Financing Receivable | Warehouse finance
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans receivable	250,003	65,000
Financing Receivable | Total National Lending
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans receivable	2,430,529	1,846,283
Loans Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans receivable	1,195,434	1,098,706
Loans Receivable | Commercial real estate and operating
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans receivable	877,412	790,890
Loans Receivable | Consumer one to four family real estate and other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans receivable	256,853	247,318
Loans Receivable | Agricultural real estate and operating
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans receivable	61,169	$ 60,498
Crestmark Bancorp, Inc.
Accounts, Notes, Loans and Financing Receivable [Line Items]
Receivables acquired	402,400
Acquired loans and leases from Crestmark acquisition			$ 1,060,000
Credit discounts	$ (6,800)		(12,300)
Interest rate mark discounts			$ (6,000)	$ (3,200)

XML

ACQUISITIONS - Purchase Price Allocation (Details) - USD ($) $ in Thousands	9 Months Ended
	Jun. 30, 2019	Sep. 30, 2018	Aug. 01, 2018	Jun. 30, 2018	Sep. 30, 2017
Business Acquisition [Line Items]
Goodwill	$ 307,941	$ 303,270		$ 98,723	$ 98,723
Crestmark Bancorp, Inc.
Business Acquisition [Line Items]
Rental Equipment	95,622		$ 98,977
Measurement period adjustments, Rental Equipment	(3,355)
Intangible assets	28,136		28,253
Measurement period adjustments, Intangible assets	(117)
Goodwill	209,218		204,547
Measurement period adjustments, Goodwill	4,671
Accrued expenses and other liabilities	89,500		88,301
Measurement period adjustments, Accrued expenses and other liabilities	1,199
Net other assets	55,464		55,464
Noncontrolling interest	3,167		3,167
Purchase price	$ 295,773		$ 295,773

XML

LOANS AND LEASES, NET - Schedule of Loans Purchased and Sold, by Portfolio Segment (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Accounts, Notes, Loans and Financing Receivable [Line Items]
Purchases	$ 6,703	$ 0	$ 12,643	$ 0
Loans held for investment			219,551	95,169
Total purchases	82,150	6,183	232,194	95,169
Loans held for sale			95,663	0
Total sales	59,873	10,379	105,634	19,961
Financing Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans held for investment	72,737	0	198,328	72,751
Loans held for sale	57,661	0	92,565	0
Loans Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans held for investment	2,710	6,183	21,223	22,418
Loans held for investment: Total Community Banking	$ 2,212	$ 10,379	$ 13,069	$ 19,961

XML

LOANS AND LEASES, NET - Direct Financing and Sales-type Leases, and Lease Receivable Maturity (Details) - USD ($) $ in Thousands	Jun. 30, 2019	Sep. 30, 2018
Net Investment in Lease [Abstract]
Minimum lease payments receivable	$ 388,291	$ 301,835
Estimated residual value of leased equipment	12,128	12,406
Unamortized initial direct costs	5,173	1,806
Premium on acquired leases	3	26
Unearned income	(58,450)	(48,949)
Net investment in direct financing and sales-type leases	347,145	$ 267,124
Sales-type and Direct Financing Leases, Lease Receivable, Fiscal Year Maturity [Abstract]
Remaining in 2019	36,473
2020	129,577
2021	104,805
2022	67,262
2023	37,753
2024 and thereafter	12,421
Total	$ 388,291

XML

LOANS AND LEASES, NET - Allowance for Loan Losses and Recorded Investment in Loans (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Sep. 30, 2018
Allowance for Credit Losses [Roll Forward]
Beginning balance	$ 48,672	$ 27,078	$ 13,040	$ 7,534
Provision (recovery) for loan losses	9,112	5,315	51,529	24,726
Charge offs	(14,751)	(10,750)	(24,077)	(11,249)
Recoveries	472	307	3,013	939
Ending balance	43,505	21,950	43,505	21,950
Ending balance: individually evaluated for impairment					$ 267	$ 0
Ending balance: collectively evaluated for impairment					43,238	13,040
Total	48,672	27,078	43,505	21,950	43,505	13,040
Loans:
Ending balance: individually evaluated for impairment					25,530	15,611
Ending balance: collectively evaluated for impairment					3,600,433	2,929,378
Total loans and leases					3,625,963	2,944,989
Financing Receivable
Loans:
Total loans and leases					2,430,529	1,846,283
Financing Receivable | Asset based lending
Allowance for Credit Losses [Roll Forward]
Beginning balance	3,499		107
Provision (recovery) for loan losses	2,685		6,213
Charge offs	(1,380)		(1,642)
Recoveries	3		129
Ending balance	4,807		4,807
Ending balance: individually evaluated for impairment					12	0
Ending balance: collectively evaluated for impairment					4,795	107
Total	3,499		4,807		4,807	107
Loans:
Ending balance: individually evaluated for impairment					8,119	1,404
Ending balance: collectively evaluated for impairment					607,190	476,513
Total loans and leases					615,309	477,917
Financing Receivable | Factoring
Allowance for Credit Losses [Roll Forward]
Beginning balance	1,761		64
Provision (recovery) for loan losses	2,747		5,769
Charge offs	(1,335)		(2,711)
Recoveries	31		82
Ending balance	3,204		3,204
Ending balance: individually evaluated for impairment					255	0
Ending balance: collectively evaluated for impairment					2,949	64
Total	1,761		3,204		3,204	64
Loans:
Ending balance: individually evaluated for impairment					7,795	3,331
Ending balance: collectively evaluated for impairment					312,549	280,890
Total loans and leases					320,344	284,221
Financing Receivable | Lease financing
Allowance for Credit Losses [Roll Forward]
Beginning balance	1,965		59
Provision (recovery) for loan losses	(13)		1,529
Charge offs	(736)		(2,198)
Recoveries	203		2,029
Ending balance	1,419		1,419
Ending balance: individually evaluated for impairment					0	0
Ending balance: collectively evaluated for impairment					1,419	59
Total	1,965		1,419		1,419	59
Loans:
Ending balance: individually evaluated for impairment					5,455	8,877
Ending balance: collectively evaluated for impairment					336,502	256,438
Total loans and leases					341,957	265,315
Financing Receivable | Insurance premium finance
Allowance for Credit Losses [Roll Forward]
Beginning balance	919	746	1,031	796
Provision (recovery) for loan losses	201	304	2,091	569
Charge offs	(275)	(243)	(2,359)	(711)
Recoveries	171	99	253	252
Ending balance	1,016	906	1,016	906
Ending balance: individually evaluated for impairment					0	0
Ending balance: collectively evaluated for impairment					1,016	1,031
Total	919	746	1,031	906	1,016	1,031
Loans:
Ending balance: individually evaluated for impairment					0	0
Ending balance: collectively evaluated for impairment					358,772	337,877
Total loans and leases					358,772	337,877
Financing Receivable | SBA/USDA
Allowance for Credit Losses [Roll Forward]
Beginning balance	474		13
Provision (recovery) for loan losses	449		910
Charge offs	0		0
Recoveries	0		0
Ending balance	923		923
Ending balance: individually evaluated for impairment					0	0
Ending balance: collectively evaluated for impairment					923	13
Total	474		923		923	13
Loans:
Ending balance: individually evaluated for impairment					1,276	0
Ending balance: collectively evaluated for impairment					98,515	59,374
Total loans and leases					99,791	59,374
Financing Receivable | Other commercial finance
Allowance for Credit Losses [Roll Forward]
Beginning balance	525	4	28	4
Provision (recovery) for loan losses	432	8	929	8
Charge offs	0	0	0	0
Recoveries	0	0	0	0
Ending balance	957	12	957	12
Ending balance: individually evaluated for impairment					0	0
Ending balance: collectively evaluated for impairment					957	28
Total	525	4	957	4	957	28
Loans:
Ending balance: individually evaluated for impairment					0	0
Ending balance: collectively evaluated for impairment					99,677	85,145
Total loans and leases					99,677	85,145
Financing Receivable | Commercial finance
Allowance for Credit Losses [Roll Forward]
Beginning balance	9,143	750	1,302	800
Provision (recovery) for loan losses	6,501	312	17,441	577
Charge offs	(3,726)	(243)	(8,910)	(711)
Recoveries	408	99	2,493	252
Ending balance	12,326	918	12,326	918
Ending balance: individually evaluated for impairment					267	0
Ending balance: collectively evaluated for impairment					12,059	1,302
Total	9,143	750	12,326	918	12,326	1,302
Loans:
Ending balance: individually evaluated for impairment					22,645	13,612
Ending balance: collectively evaluated for impairment					1,813,205	1,496,237
Total loans and leases					1,835,850	1,509,849
Financing Receivable | Consumer credit products
Allowance for Credit Losses [Roll Forward]
Beginning balance	1,314	0	785	0
Provision (recovery) for loan losses	142	264	671	264
Charge offs	0	0	0	0
Recoveries	0	0	0	0
Ending balance	1,456	264	1,456	264
Ending balance: individually evaluated for impairment					0	0
Ending balance: collectively evaluated for impairment					1,456	785
Total	1,314	0	785	264	1,456	785
Loans:
Ending balance: individually evaluated for impairment					0	0
Ending balance: collectively evaluated for impairment					155,539	80,605
Total loans and leases					155,539	80,605
Financing Receivable | Other consumer finance
Allowance for Credit Losses [Roll Forward]
Beginning balance	5,130	0	2,820	0
Provision (recovery) for loan losses	1,890	3,000	8,249	3,000
Charge offs	(1,398)	0	(5,477)	0
Recoveries	28	0	58	0
Ending balance	5,650	3,000	5,650	3,000
Ending balance: individually evaluated for impairment					0	0
Ending balance: collectively evaluated for impairment					5,650	2,820
Total	5,130	0	5,650	0	5,650	2,820
Loans:
Ending balance: individually evaluated for impairment					1,039	0
Ending balance: collectively evaluated for impairment					163,688	189,756
Total loans and leases					164,727	189,756
Financing Receivable | Consumer finance
Allowance for Credit Losses [Roll Forward]
Beginning balance	6,444	0	3,605	0
Provision (recovery) for loan losses	2,032	3,264	8,920	3,264
Charge offs	(1,398)	0	(5,477)	0
Recoveries	28	0	58	0
Ending balance	7,106	3,264	7,106	3,264
Ending balance: individually evaluated for impairment					0	0
Ending balance: collectively evaluated for impairment					7,106	3,605
Total	6,444	0	3,605	0	7,106	3,605
Loans:
Ending balance: individually evaluated for impairment					1,039	0
Ending balance: collectively evaluated for impairment					319,227	270,361
Total loans and leases					320,266	270,361
Financing Receivable | Tax services
Allowance for Credit Losses [Roll Forward]
Beginning balance	24,102	19,573	0	5
Provision (recovery) for loan losses	914	1,189	24,883	20,335
Charge offs	(9,627)	(10,507)	(9,670)	(10,507)
Recoveries	36	1	212	423
Ending balance	15,425	10,256	15,425	10,256
Ending balance: individually evaluated for impairment					0	0
Ending balance: collectively evaluated for impairment					15,425	0
Total	24,102	19,573	0	10,256	15,425	0
Loans:
Ending balance: individually evaluated for impairment					0	0
Ending balance: collectively evaluated for impairment					24,410	1,073
Total loans and leases					24,410	1,073
Financing Receivable | Warehouse finance
Allowance for Credit Losses [Roll Forward]
Beginning balance	185		65
Provision (recovery) for loan losses	65		185
Charge offs	0		0
Recoveries	0		0
Ending balance	250		250
Ending balance: individually evaluated for impairment					0	0
Ending balance: collectively evaluated for impairment					250	65
Total	185		250		250	65
Loans:
Ending balance: individually evaluated for impairment					0	0
Ending balance: collectively evaluated for impairment					250,003	65,000
Total loans and leases					250,003	65,000
Financing Receivable | Total National Lending
Allowance for Credit Losses [Roll Forward]
Beginning balance	39,874	20,323	4,972	805
Provision (recovery) for loan losses	9,512	4,765	51,429	24,176
Charge offs	(14,751)	(10,750)	(24,057)	(11,218)
Recoveries	472	100	2,763	675
Ending balance	35,107	14,438	35,107	14,438
Ending balance: individually evaluated for impairment					267	0
Ending balance: collectively evaluated for impairment					34,840	4,972
Total	39,874	20,323	35,107	14,438	35,107	4,972
Loans:
Ending balance: individually evaluated for impairment					23,684	13,612
Ending balance: collectively evaluated for impairment					2,406,845	1,832,671
Total loans and leases					2,430,529	1,846,283
Loans Receivable
Allowance for Credit Losses [Roll Forward]
Beginning balance	8,798	6,755	8,068	6,729
Provision (recovery) for loan losses	(400)	550	100	550
Charge offs	0	0	(20)	(31)
Recoveries	0	207	250	264
Ending balance	8,398	7,512	8,398	7,512
Ending balance: individually evaluated for impairment					0	0
Ending balance: collectively evaluated for impairment					8,398	8,068
Total	8,798	6,755	8,398	7,512	8,398	8,068
Loans:
Ending balance: individually evaluated for impairment					1,846	1,999
Ending balance: collectively evaluated for impairment					1,193,588	1,096,707
Total loans and leases					1,195,434	1,098,706
Loans Receivable | Unallocated
Allowance for Credit Losses [Roll Forward]
Beginning balance		989		526
Provision (recovery) for loan losses		132		595
Charge offs		0		0
Recoveries		0		0
Ending balance		1,121		1,121
Total		989		526
Loans Receivable | Commercial real estate and operating
Allowance for Credit Losses [Roll Forward]
Beginning balance	6,673	4,100	6,220	2,820
Provision (recovery) for loan losses	(249)	687	204	1,967
Charge offs	0	0	0	0
Recoveries	0	0	0	0
Ending balance	6,424	4,787	6,424	4,787
Ending balance: individually evaluated for impairment					0	0
Ending balance: collectively evaluated for impairment					6,424	6,220
Total	6,673	4,100	6,220	2,820	6,424	6,220
Loans:
Ending balance: individually evaluated for impairment					319	451
Ending balance: collectively evaluated for impairment					877,093	790,439
Total loans and leases					877,412	790,890
Loans Receivable | Consumer one to four family real estate and other
Allowance for Credit Losses [Roll Forward]
Beginning balance	958	901	632	809
Provision (recovery) for loan losses	(65)	(218)	281	(98)
Charge offs	0	0	(20)	(31)
Recoveries	0	0	0	3
Ending balance	893	683	893	683
Ending balance: individually evaluated for impairment					0	0
Ending balance: collectively evaluated for impairment					893	632
Total	958	901	893	683	893	632
Loans:
Ending balance: individually evaluated for impairment					290	94
Ending balance: collectively evaluated for impairment					256,563	247,224
Total loans and leases					256,853	247,318
Loans Receivable | Agricultural real estate and operating
Allowance for Credit Losses [Roll Forward]
Beginning balance	1,167	765	1,216	2,574
Provision (recovery) for loan losses	(86)	(51)	(385)	(1,914)
Charge offs	0	0	0	0
Recoveries	0	207	250	261
Ending balance	1,081	921	1,081	921
Ending balance: individually evaluated for impairment					0	0
Ending balance: collectively evaluated for impairment					1,081	1,216
Total	$ 1,167	$ 765	$ 1,081	$ 2,574	1,081	1,216
Loans:
Ending balance: individually evaluated for impairment					1,237	1,454
Ending balance: collectively evaluated for impairment					59,932	59,044
Total loans and leases					$ 61,169	$ 60,498

XML

LOANS AND LEASES, NET - Asset Classification of Loans (Details) - USD ($) $ in Thousands	Jun. 30, 2019	Sep. 30, 2018
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	$ 3,625,963	$ 2,944,989
Pass
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	3,442,442	2,783,536
Watch
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	9,513	15,235
Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	139,028	121,639
Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	34,980	24,579
Financing Receivable
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	2,430,529	1,846,283
Financing Receivable | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	2,278,420	1,716,336
Financing Receivable | Watch
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	0	0
Financing Receivable | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	129,464	116,334
Financing Receivable | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	22,645	13,613
Financing Receivable | Asset based lending
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	615,309	477,917
Financing Receivable | Asset based lending | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	539,623	418,635
Financing Receivable | Asset based lending | Watch
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	0	0
Financing Receivable | Asset based lending | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	67,567	57,877
Financing Receivable | Asset based lending | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	8,119	1,405
Financing Receivable | Factoring
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	320,344	284,221
Financing Receivable | Factoring | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	272,589	248,246
Financing Receivable | Factoring | Watch
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	0	0
Financing Receivable | Factoring | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	39,960	32,644
Financing Receivable | Factoring | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	7,795	3,331
Financing Receivable | Lease financing
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	341,957	265,315
Financing Receivable | Lease financing | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	323,539	252,487
Financing Receivable | Lease financing | Watch
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	0	0
Financing Receivable | Lease financing | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	12,963	3,951
Financing Receivable | Lease financing | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	5,455	8,877
Financing Receivable | Insurance premium finance
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	358,772	337,877
Financing Receivable | Insurance premium finance | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	358,772	336,296
Financing Receivable | Insurance premium finance | Watch
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	0	0
Financing Receivable | Insurance premium finance | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	0	1,581
Financing Receivable | Insurance premium finance | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	0	0
Financing Receivable | SBA/USDA
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	99,791	59,374
Financing Receivable | SBA/USDA | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	90,110	39,093
Financing Receivable | SBA/USDA | Watch
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	0	0
Financing Receivable | SBA/USDA | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	8,405	20,281
Financing Receivable | SBA/USDA | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	1,276	0
Financing Receivable | Other commercial finance
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	99,677	85,145
Financing Receivable | Other commercial finance | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	99,108	85,145
Financing Receivable | Other commercial finance | Watch
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	0	0
Financing Receivable | Other commercial finance | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	569	0
Financing Receivable | Other commercial finance | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	0	0
Financing Receivable | Commercial finance
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	1,835,850	1,509,849
Financing Receivable | Commercial finance | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	1,683,741	1,379,902
Financing Receivable | Commercial finance | Watch
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	0	0
Financing Receivable | Commercial finance | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	129,464	116,334
Financing Receivable | Commercial finance | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	22,645	13,613
Financing Receivable | Consumer credit products
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	155,539	80,605
Financing Receivable | Consumer credit products | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	155,539	80,605
Financing Receivable | Consumer credit products | Watch
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	0	0
Financing Receivable | Consumer credit products | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	0	0
Financing Receivable | Consumer credit products | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	0	0
Financing Receivable | Other consumer finance
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	164,727	189,756
Financing Receivable | Other consumer finance | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	164,727	189,756
Financing Receivable | Other consumer finance | Watch
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	0	0
Financing Receivable | Other consumer finance | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	0	0
Financing Receivable | Other consumer finance | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	0	0
Financing Receivable | Consumer finance
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	320,266	270,361
Financing Receivable | Consumer finance | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	320,266	270,361
Financing Receivable | Consumer finance | Watch
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	0	0
Financing Receivable | Consumer finance | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	0	0
Financing Receivable | Consumer finance | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	0	0
Financing Receivable | Tax services
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	24,410	1,073
Financing Receivable | Tax services | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	24,410	1,073
Financing Receivable | Tax services | Watch
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	0	0
Financing Receivable | Tax services | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	0	0
Financing Receivable | Tax services | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	0	0
Financing Receivable | Warehouse finance
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	250,003	65,000
Financing Receivable | Warehouse finance | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	250,003	65,000
Financing Receivable | Warehouse finance | Watch
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	0	0
Financing Receivable | Warehouse finance | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	0	0
Financing Receivable | Warehouse finance | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	0	0
Loans Receivable
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	1,195,434	1,098,706
Loans Receivable | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	1,164,022	1,067,200
Loans Receivable | Watch
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	9,513	15,235
Loans Receivable | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	9,564	5,305
Loans Receivable | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	12,335	10,966
Loans Receivable | Commercial real estate and operating
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	877,412	790,890
Loans Receivable | Commercial real estate and operating | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	866,255	778,445
Loans Receivable | Commercial real estate and operating | Watch
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	3,962	12,251
Loans Receivable | Commercial real estate and operating | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	3,487	194
Loans Receivable | Commercial real estate and operating | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	3,708	0
Loans Receivable | Consumer one-to-four family real estate and other
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	256,853	247,318
Loans Receivable | Consumer one-to-four family real estate and other | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	254,959	246,463
Loans Receivable | Consumer one-to-four family real estate and other | Watch
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	1,403	537
Loans Receivable | Consumer one-to-four family real estate and other | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	462	239
Loans Receivable | Consumer one-to-four family real estate and other | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	29	79
Loans Receivable | Agricultural real estate and operating
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	61,169	60,498
Loans Receivable | Agricultural real estate and operating | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	42,808	42,292
Loans Receivable | Agricultural real estate and operating | Watch
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	4,148	2,447
Loans Receivable | Agricultural real estate and operating | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	5,615	4,872
Loans Receivable | Agricultural real estate and operating | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans and leases	$ 8,598	$ 10,887

XML

LOANS AND LEASES, NET - Past Due Loans (Details) - USD ($) $ in Thousands	Jun. 30, 2019	Sep. 30, 2018
Financing Receivable, Past Due [Line Items]
Total loans and leases	$ 3,625,963	$ 2,944,989
Performing Financial Instruments
Financing Receivable, Past Due [Line Items]
Total past due	52,047	38,851
Current	3,573,916	2,906,138
Total loans and leases	3,625,963	2,944,989
Performing Financial Instruments | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	10,348	24,022
Performing Financial Instruments | 60-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	29,424	5,297
Performing Financial Instruments | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total past due	12,275	9,532
Nonperforming Financial Instruments
Financing Receivable, Past Due [Line Items]
Total loans and leases	20,798	10,201
Non-accrual balance	12,928	2,864
Nonperforming Financial Instruments | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Non-accrual balance	7,870	7,337
Financing Receivable
Financing Receivable, Past Due [Line Items]
Total loans and leases	2,430,529	1,846,283
Financing Receivable | Asset based lending
Financing Receivable, Past Due [Line Items]
Total loans and leases	615,309	477,917
Financing Receivable | Factoring
Financing Receivable, Past Due [Line Items]
Total loans and leases	320,344	284,221
Financing Receivable | Lease financing
Financing Receivable, Past Due [Line Items]
Total loans and leases	341,957	265,315
Financing Receivable | Insurance premium finance
Financing Receivable, Past Due [Line Items]
Total loans and leases	358,772	337,877
Financing Receivable | SBA/USDA
Financing Receivable, Past Due [Line Items]
Total loans and leases	99,791	59,374
Financing Receivable | Other commercial finance
Financing Receivable, Past Due [Line Items]
Total loans and leases	99,677	85,145
Financing Receivable | Commercial finance
Financing Receivable, Past Due [Line Items]
Total loans and leases	1,835,850	1,509,849
Financing Receivable | Consumer credit products
Financing Receivable, Past Due [Line Items]
Total loans and leases	155,539	80,605
Financing Receivable | Other consumer finance
Financing Receivable, Past Due [Line Items]
Total loans and leases	164,727	189,756
Financing Receivable | Consumer finance
Financing Receivable, Past Due [Line Items]
Total loans and leases	320,266	270,361
Financing Receivable | Tax services
Financing Receivable, Past Due [Line Items]
Total loans and leases	24,410	1,073
Financing Receivable | Warehouse finance
Financing Receivable, Past Due [Line Items]
Total loans and leases	250,003	65,000
Financing Receivable | Performing Financial Instruments
Financing Receivable, Past Due [Line Items]
Total past due	49,979	38,667
Current	2,380,550	1,807,616
Total loans and leases	2,430,529	1,846,283
Financing Receivable | Performing Financial Instruments | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	8,549	23,917
Financing Receivable | Performing Financial Instruments | 60-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	29,388	5,297
Financing Receivable | Performing Financial Instruments | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total past due	12,042	9,453
Financing Receivable | Performing Financial Instruments | Asset based lending
Financing Receivable, Past Due [Line Items]
Total past due	5,019	3,480
Current	610,290	474,437
Total loans and leases	615,309	477,917
Financing Receivable | Performing Financial Instruments | Asset based lending | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	1,701	1,235
Financing Receivable | Performing Financial Instruments | Asset based lending | 60-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	428	2,151
Financing Receivable | Performing Financial Instruments | Asset based lending | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total past due	2,890	94
Financing Receivable | Performing Financial Instruments | Factoring
Financing Receivable, Past Due [Line Items]
Total past due	20	0
Current	320,324	284,221
Total loans and leases	320,344	284,221
Financing Receivable | Performing Financial Instruments | Factoring | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	0	0
Financing Receivable | Performing Financial Instruments | Factoring | 60-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	0	0
Financing Receivable | Performing Financial Instruments | Factoring | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total past due	20	0
Financing Receivable | Performing Financial Instruments | Lease financing
Financing Receivable, Past Due [Line Items]
Total past due	9,304	19,995
Current	332,653	245,320
Total loans and leases	341,957	265,315
Financing Receivable | Performing Financial Instruments | Lease financing | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	2,080	16,542
Financing Receivable | Performing Financial Instruments | Lease financing | 60-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	1,816	532
Financing Receivable | Performing Financial Instruments | Lease financing | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total past due	5,408	2,921
Financing Receivable | Performing Financial Instruments | Insurance premium finance
Financing Receivable, Past Due [Line Items]
Total past due	4,993	5,864
Current	353,779	332,013
Total loans and leases	358,772	337,877
Financing Receivable | Performing Financial Instruments | Insurance premium finance | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	2,233	1,864
Financing Receivable | Performing Financial Instruments | Insurance premium finance | 60-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	1,081	1,019
Financing Receivable | Performing Financial Instruments | Insurance premium finance | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total past due	1,679	2,981
Financing Receivable | Performing Financial Instruments | SBA/USDA
Financing Receivable, Past Due [Line Items]
Total past due	344	1,067
Current	99,447	58,307
Total loans and leases	99,791	59,374
Financing Receivable | Performing Financial Instruments | SBA/USDA | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	85	1,067
Financing Receivable | Performing Financial Instruments | SBA/USDA | 60-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	0	0
Financing Receivable | Performing Financial Instruments | SBA/USDA | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total past due	259	0
Financing Receivable | Performing Financial Instruments | Other commercial finance
Financing Receivable, Past Due [Line Items]
Total past due	0	0
Current	99,677	85,145
Total loans and leases	99,677	85,145
Financing Receivable | Performing Financial Instruments | Other commercial finance | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	0	0
Financing Receivable | Performing Financial Instruments | Other commercial finance | 60-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	0	0
Financing Receivable | Performing Financial Instruments | Other commercial finance | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total past due	0	0
Financing Receivable | Performing Financial Instruments | Commercial finance
Financing Receivable, Past Due [Line Items]
Total past due	19,680	30,406
Current	1,816,170	1,479,443
Total loans and leases	1,835,850	1,509,849
Financing Receivable | Performing Financial Instruments | Commercial finance | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	6,099	20,708
Financing Receivable | Performing Financial Instruments | Commercial finance | 60-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	3,325	3,702
Financing Receivable | Performing Financial Instruments | Commercial finance | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total past due	10,256	5,996
Financing Receivable | Performing Financial Instruments | Consumer credit products
Financing Receivable, Past Due [Line Items]
Total past due	3,196	963
Current	152,343	79,642
Total loans and leases	155,539	80,605
Financing Receivable | Performing Financial Instruments | Consumer credit products | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	1,454	532
Financing Receivable | Performing Financial Instruments | Consumer credit products | 60-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	1,039	284
Financing Receivable | Performing Financial Instruments | Consumer credit products | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total past due	703	147
Financing Receivable | Performing Financial Instruments | Other consumer finance
Financing Receivable, Past Due [Line Items]
Total past due	2,693	6,225
Current	162,034	183,531
Total loans and leases	164,727	189,756
Financing Receivable | Performing Financial Instruments | Other consumer finance | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	996	2,677
Financing Receivable | Performing Financial Instruments | Other consumer finance | 60-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	614	1,311
Financing Receivable | Performing Financial Instruments | Other consumer finance | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total past due	1,083	2,237
Financing Receivable | Performing Financial Instruments | Consumer finance
Financing Receivable, Past Due [Line Items]
Total past due	5,889	7,188
Current	314,377	263,173
Total loans and leases	320,266	270,361
Financing Receivable | Performing Financial Instruments | Consumer finance | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	2,450	3,209
Financing Receivable | Performing Financial Instruments | Consumer finance | 60-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	1,653	1,595
Financing Receivable | Performing Financial Instruments | Consumer finance | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total past due	1,786	2,384
Financing Receivable | Performing Financial Instruments | Tax services
Financing Receivable, Past Due [Line Items]
Total past due	24,410	1,073
Current	0	0
Total loans and leases	24,410	1,073
Financing Receivable | Performing Financial Instruments | Tax services | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	0	0
Financing Receivable | Performing Financial Instruments | Tax services | 60-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	24,410	0
Financing Receivable | Performing Financial Instruments | Tax services | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total past due	0	1,073
Financing Receivable | Performing Financial Instruments | Warehouse finance
Financing Receivable, Past Due [Line Items]
Total past due	0	0
Current	250,003	65,000
Total loans and leases	250,003	65,000
Financing Receivable | Performing Financial Instruments | Warehouse finance | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	0	0
Financing Receivable | Performing Financial Instruments | Warehouse finance | 60-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	0	0
Financing Receivable | Performing Financial Instruments | Warehouse finance | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total past due	0	0
Financing Receivable | Nonperforming Financial Instruments
Financing Receivable, Past Due [Line Items]
Total loans and leases	20,565	10,122
Non-accrual balance	12,695	2,864
Financing Receivable | Nonperforming Financial Instruments | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Non-accrual balance	7,870	7,258
Financing Receivable | Nonperforming Financial Instruments | Asset based lending
Financing Receivable, Past Due [Line Items]
Total loans and leases	5,834	94
Non-accrual balance	5,654	0
Financing Receivable | Nonperforming Financial Instruments | Asset based lending | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Non-accrual balance	180	94
Financing Receivable | Nonperforming Financial Instruments | Factoring
Financing Receivable, Past Due [Line Items]
Total loans and leases	4,846	0
Non-accrual balance	4,846	0
Financing Receivable | Nonperforming Financial Instruments | Factoring | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Non-accrual balance	0	0
Financing Receivable | Nonperforming Financial Instruments | Lease financing
Financing Receivable, Past Due [Line Items]
Total loans and leases	6,161	3,590
Non-accrual balance	1,936	2,864
Financing Receivable | Nonperforming Financial Instruments | Lease financing | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Non-accrual balance	4,225	726
Financing Receivable | Nonperforming Financial Instruments | Insurance premium finance
Financing Receivable, Past Due [Line Items]
Total loans and leases	1,679	2,981
Non-accrual balance	0	0
Financing Receivable | Nonperforming Financial Instruments | Insurance premium finance | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Non-accrual balance	1,679	2,981
Financing Receivable | Nonperforming Financial Instruments | SBA/USDA
Financing Receivable, Past Due [Line Items]
Total loans and leases	259	0
Non-accrual balance	259	0
Financing Receivable | Nonperforming Financial Instruments | SBA/USDA | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Non-accrual balance	0	0
Financing Receivable | Nonperforming Financial Instruments | Other commercial finance
Financing Receivable, Past Due [Line Items]
Total loans and leases	0	0
Non-accrual balance	0	0
Financing Receivable | Nonperforming Financial Instruments | Other commercial finance | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Non-accrual balance	0	0
Financing Receivable | Nonperforming Financial Instruments | Commercial finance
Financing Receivable, Past Due [Line Items]
Total loans and leases	18,779	6,665
Non-accrual balance	12,695	2,864
Financing Receivable | Nonperforming Financial Instruments | Commercial finance | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Non-accrual balance	6,084	3,801
Financing Receivable | Nonperforming Financial Instruments | Consumer credit products
Financing Receivable, Past Due [Line Items]
Total loans and leases	703	147
Non-accrual balance	0	0
Financing Receivable | Nonperforming Financial Instruments | Consumer credit products | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Non-accrual balance	703	147
Financing Receivable | Nonperforming Financial Instruments | Other consumer finance
Financing Receivable, Past Due [Line Items]
Total loans and leases	1,083	2,237
Non-accrual balance	0	0
Financing Receivable | Nonperforming Financial Instruments | Other consumer finance | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Non-accrual balance	1,083	2,237
Financing Receivable | Nonperforming Financial Instruments | Consumer finance
Financing Receivable, Past Due [Line Items]
Total loans and leases	1,786	2,384
Non-accrual balance	0	0
Financing Receivable | Nonperforming Financial Instruments | Consumer finance | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Non-accrual balance	1,786	2,384
Financing Receivable | Nonperforming Financial Instruments | Tax services
Financing Receivable, Past Due [Line Items]
Total loans and leases	0	1,073
Non-accrual balance	0	0
Financing Receivable | Nonperforming Financial Instruments | Tax services | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Non-accrual balance	0	1,073
Financing Receivable | Nonperforming Financial Instruments | Warehouse finance
Financing Receivable, Past Due [Line Items]
Total loans and leases	0	0
Non-accrual balance	0	0
Financing Receivable | Nonperforming Financial Instruments | Warehouse finance | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Non-accrual balance	0	0
Loans Receivable
Financing Receivable, Past Due [Line Items]
Total loans and leases	1,195,434	1,098,706
Loans Receivable | Commercial real estate and operating
Financing Receivable, Past Due [Line Items]
Total loans and leases	877,412	790,890
Loans Receivable | Consumer one to four family real estate and other
Financing Receivable, Past Due [Line Items]
Total loans and leases	256,853	247,318
Loans Receivable | Agricultural real estate and operating
Financing Receivable, Past Due [Line Items]
Total loans and leases	61,169	60,498
Loans Receivable | Performing Financial Instruments
Financing Receivable, Past Due [Line Items]
Total past due	2,068	184
Current	1,193,366	1,098,522
Total loans and leases	1,195,434	1,098,706
Loans Receivable | Performing Financial Instruments | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	1,799	105
Loans Receivable | Performing Financial Instruments | 60-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	36	0
Loans Receivable | Performing Financial Instruments | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total past due	233	79
Loans Receivable | Performing Financial Instruments | Commercial real estate and operating
Financing Receivable, Past Due [Line Items]
Total past due	0	0
Current	877,412	790,890
Total loans and leases	877,412	790,890
Loans Receivable | Performing Financial Instruments | Commercial real estate and operating | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	0	0
Loans Receivable | Performing Financial Instruments | Commercial real estate and operating | 60-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	0	0
Loans Receivable | Performing Financial Instruments | Commercial real estate and operating | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total past due	0	0
Loans Receivable | Performing Financial Instruments | Consumer one to four family real estate and other
Financing Receivable, Past Due [Line Items]
Total past due	323	184
Current	256,530	247,134
Total loans and leases	256,853	247,318
Loans Receivable | Performing Financial Instruments | Consumer one to four family real estate and other | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	54	105
Loans Receivable | Performing Financial Instruments | Consumer one to four family real estate and other | 60-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	36	0
Loans Receivable | Performing Financial Instruments | Consumer one to four family real estate and other | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total past due	233	79
Loans Receivable | Performing Financial Instruments | Agricultural real estate and operating
Financing Receivable, Past Due [Line Items]
Total past due	1,745	0
Current	59,424	60,498
Total loans and leases	61,169	60,498
Loans Receivable | Performing Financial Instruments | Agricultural real estate and operating | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	1,745	0
Loans Receivable | Performing Financial Instruments | Agricultural real estate and operating | 60-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total past due	0	0
Loans Receivable | Performing Financial Instruments | Agricultural real estate and operating | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total past due	0	0
Loans Receivable | Nonperforming Financial Instruments
Financing Receivable, Past Due [Line Items]
Total loans and leases	233	79
Non-accrual balance	233	0
Loans Receivable | Nonperforming Financial Instruments | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Non-accrual balance	0	79
Loans Receivable | Nonperforming Financial Instruments | Commercial real estate and operating
Financing Receivable, Past Due [Line Items]
Total loans and leases	0	0
Non-accrual balance	0	0
Loans Receivable | Nonperforming Financial Instruments | Commercial real estate and operating | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Non-accrual balance	0	0
Loans Receivable | Nonperforming Financial Instruments | Consumer one to four family real estate and other
Financing Receivable, Past Due [Line Items]
Total loans and leases	233	79
Non-accrual balance	233	0
Loans Receivable | Nonperforming Financial Instruments | Consumer one to four family real estate and other | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Non-accrual balance	0	79
Loans Receivable | Nonperforming Financial Instruments | Agricultural real estate and operating
Financing Receivable, Past Due [Line Items]
Total loans and leases	0	0
Non-accrual balance	0	0
Loans Receivable | Nonperforming Financial Instruments | Agricultural real estate and operating | Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Non-accrual balance	$ 0	$ 0

XML

LOANS AND LEASES, NET - Impaired Loans (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018	Sep. 30, 2018
Loans without a specific valuation allowance
Recorded Balance	$ 21,220		$ 21,220		$ 10,198
Unpaid Principal Balance	23,683		23,683		10,528
Loans with a specific valuation allowance [Abstract]
Recorded investment	4,310		4,310		5,413
Unpaid principal balance	5,662		5,662		5,663
Specific allowance	267		267		588
Average Recorded Investment	19,788	$ 3,616	16,324	$ 2,552
Recognized Interest Income	150	48	397	131
Financing Receivable
Loans without a specific valuation allowance
Recorded Balance	19,374		19,374		8,199
Unpaid Principal Balance	21,837		21,837		8,529
Loans with a specific valuation allowance [Abstract]
Recorded investment	4,310		4,310		5,413
Unpaid principal balance	5,662		5,662		5,663
Specific allowance	267		267		588
Average Recorded Investment	18,270	0	14,540	0
Recognized Interest Income	116	0	322	0
Financing Receivable | Asset based lending
Loans without a specific valuation allowance
Recorded Balance	8,024		8,024		1,325
Unpaid Principal Balance	9,362		9,362		1,325
Loans with a specific valuation allowance [Abstract]
Recorded investment	95		95		79
Unpaid principal balance	107		107		79
Specific allowance	12		12		22
Average Recorded Investment	6,683	0	3,993	0
Recognized Interest Income	88	0	262	0
Financing Receivable | Factoring
Loans without a specific valuation allowance
Recorded Balance	3,580		3,580		1,383
Unpaid Principal Balance	4,655		4,655		1,713
Loans with a specific valuation allowance [Abstract]
Recorded investment	4,215		4,215		1,948
Unpaid principal balance	5,555		5,555		2,198
Specific allowance	255		255		49
Average Recorded Investment	6,621	0	4,178	0
Recognized Interest Income	0	0	5	0
Financing Receivable | Lease financing
Loans without a specific valuation allowance
Recorded Balance	5,455		5,455		5,491
Unpaid Principal Balance	5,455		5,455		5,491
Loans with a specific valuation allowance [Abstract]
Recorded investment					3,386
Unpaid principal balance					3,386
Specific allowance					517
Average Recorded Investment	3,351	0	5,012	0
Recognized Interest Income	0	0	17	0
Financing Receivable | SBA/USDA
Loans without a specific valuation allowance
Recorded Balance	1,276		1,276
Unpaid Principal Balance	1,276		1,276
Loans with a specific valuation allowance [Abstract]
Average Recorded Investment	425	0	142	0
Recognized Interest Income	0	0	0	0
Financing Receivable | Commercial finance
Loans without a specific valuation allowance
Recorded Balance	18,335		18,335		8,199
Unpaid Principal Balance	20,748		20,748		8,529
Loans with a specific valuation allowance [Abstract]
Recorded investment	4,310		4,310		5,413
Unpaid principal balance	5,662		5,662		5,663
Specific allowance	267		267		588
Average Recorded Investment	17,080	0	13,325	0
Recognized Interest Income	88	0	284	0
Financing Receivable | Other consumer finance
Loans without a specific valuation allowance
Recorded Balance	1,039		1,039
Unpaid Principal Balance	1,089		1,089
Loans with a specific valuation allowance [Abstract]
Average Recorded Investment	1,190	0	1,215	0
Recognized Interest Income	28	0	38	0
Financing Receivable | Consumer finance
Loans without a specific valuation allowance
Recorded Balance	1,039		1,039
Unpaid Principal Balance	1,089		1,089
Loans with a specific valuation allowance [Abstract]
Average Recorded Investment	1,190	0	1,215	0
Recognized Interest Income	28	0	38	0
Loans Receivable
Loans without a specific valuation allowance
Recorded Balance	1,846		1,846		1,999
Unpaid Principal Balance	1,846		1,846		1,999
Loans with a specific valuation allowance [Abstract]
Average Recorded Investment	1,518	3,616	1,784	2,552
Recognized Interest Income	34	48	75	131
Loans Receivable | Commercial real estate and operating
Loans without a specific valuation allowance
Recorded Balance	319		319		405
Unpaid Principal Balance	319		319		405
Loans with a specific valuation allowance [Abstract]
Average Recorded Investment	106	604	259	761
Recognized Interest Income	5	4	9	14
Loans Receivable | Consumer one to four family real estate and other
Loans without a specific valuation allowance
Recorded Balance	290		290		140
Unpaid Principal Balance	290		290		140
Loans with a specific valuation allowance [Abstract]
Average Recorded Investment	186	342	154	224
Recognized Interest Income	1	2	3	11
Loans Receivable | Agricultural real estate and operating
Loans without a specific valuation allowance
Recorded Balance	1,237		1,237		1,454
Unpaid Principal Balance	1,237		1,237		$ 1,454
Loans with a specific valuation allowance [Abstract]
Average Recorded Investment	1,226	2,670	1,371	1,567
Recognized Interest Income	$ 28	$ 42	$ 63	$ 106

XML

LOANS AND LEASES, NET - Narrative and Additional Information (Details)	3 Months Ended		9 Months Ended
	Jun. 30, 2019 USD ($)	Jun. 30, 2018 USD ($)	Jun. 30, 2019 USD ($) Credit_programs	Jun. 30, 2018 USD ($)	Sep. 30, 2018 USD ($)
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans transferred to held for sale			$ 39,452,000	$ 0
Originations			(104,121,000)	0
Proceeds from sales			95,663,000	0
Gain on sale of loan			$ (3,650,000)	0
Percentage of specific allowance for losses			100.00%
Foreclosed real estate and repossessed assets	$ 29,514,000		$ 29,514,000		$ 31,638,000
TDR valuation allowance	100,000		100,000
Financing Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Proceeds from sales	57,661,000	$ 0	$ 92,565,000	0
Maturity period of loans receivable			1 year
TDRs recorded investment			$ 1,700,000
Loans Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
TDRs recorded investment		$ 0	700,000	3,800,000
TDRs subsequent default, recorded investment			$ 900,000	$ 100,000
Total National Lending | Financing Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
TDRs recorded investment	100,000
Consumer one to four family real estate and other | Residential Mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loan-to-value ratio threshold maximum exposure			80.00%
Consumer finance | Financing Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
TDRs recorded investment	$ 700,000
Minimum | Consumer one to four family real estate and other | Adjustable Rate Residential Mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Maturity period of loans receivable			5 years
Minimum | Agricultural real estate and operating | Fixed Rate Residential Mortgage | Financing Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Maturity period of loans receivable			5 years
Minimum | Agricultural real estate and operating | Adjustable Rate Residential Mortgage | Financing Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Maturity period of loans receivable			20 years
Maximum
Accounts, Notes, Loans and Financing Receivable [Line Items]
Financing lease, term (no greater than)	84 months		84 months
Maximum | Consumer one to four family real estate and other | Residential Mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Maturity period of loans receivable			30 years
Loan-to-value ratio, appraised value			100.00%
Loan-to-value, actual majority of loans			80.00%
Maximum | Consumer one to four family real estate and other | Fixed Rate Residential Mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Maturity period of loans receivable			30 years
Maximum | Consumer one to four family real estate and other | Adjustable Rate Residential Mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Maturity period of loans receivable			10 years
Maximum | Agricultural real estate and operating | Fixed Rate Residential Mortgage | Financing Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Maturity period of loans receivable			1 year
Maximum | Agricultural real estate and operating | Fixed Rate Residential Mortgage | Financing Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Maturity period of loans receivable			10 years
Loan-to-value ratio, appraised value			75.00%
Maximum | Agricultural real estate and operating | Adjustable Rate Residential Mortgage | Financing Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Maturity period of loans receivable			25 years
Liberty Lending, LLC | Loans Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Number of consumer credit programs | Credit_programs			2
Consumer credit program agreement, term			3 years
Liberty Lending, LLC | Minimum | Loans Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Closed-end installment loan amounts			$ 3,500
Closed-end installment loan, repayment period			13 months
Liberty Lending, LLC | Maximum | Loans Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Closed-end installment loan amounts			$ 45,000
Closed-end installment loan, repayment period			60 months
Health Credit Services | Loans Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Consumer credit program agreement, term			3 years
Health Credit Services | Minimum | Loans Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Closed-end installment loan, repayment period			12 months
Revolving lines of credit, repayment period			6 months
Health Credit Services | Maximum | Loans Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Closed-end installment loan, repayment period			84 months
Revolving lines of credit, repayment period			60 months

XML

LOANS AND LEASES, NET - Troubled Debt Restructured Loans (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018	Sep. 30, 2018
Financing Receivable, Troubled Debt Restructuring [Line Items]
Foreclosed real estate and repossessed assets		$ 29,514		$ 31,638
Community Banking Loans
Financing Receivable, Troubled Debt Restructuring [Line Items]
Loans in process of foreclosure, amount		200		$ 0
Loans Receivable
Financing Receivable, Troubled Debt Restructuring [Line Items]
TDRs recorded investment	$ 0	700	$ 3,800
TDRs subsequent default, recorded investment		900	$ 100
Financing Receivable
Financing Receivable, Troubled Debt Restructuring [Line Items]
TDRs recorded investment		$ 1,700

XML

EARNINGS PER COMMON SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands		3 Months Ended		9 Months Ended
		Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Earnings Per Common Share, Basic and Diluted [Abstract]
Net income attributable to Meta Financial Group, Inc.		$ 29,291	$ 6,792	$ 76,809	$ 42,898
Weighted average common shares outstanding (in shares)		38,903,266	29,099,472	39,220,793	29,043,309
Basic income per common share (in dollars per share)	[1]	$ 0.75	$ 0.23	$ 1.96	$ 1.48
Outstanding options - based upon the two-class method (in shares)		74,424	119,508	68,218	116,676
Weighted average common and dilutive potential common shares outstanding (in shares)		38,977,690	29,218,980	39,289,011	29,159,985
Diluted income per common share (in dollars per share)	[1]	$ 0.75	$ 0.23	$ 1.95	$ 1.47

[1] All share and per share data has been adjusted to reflect the 3-for-1 forward stock split effected by the Company on October 4, 2018.

XML

SECURITIES - Narrative (Details) - USD ($)	9 Months Ended
	Jun. 30, 2019	Oct. 01, 2018	Sep. 30, 2018
Item Effected [Line Items]
Equity securities cost	$ 1,800,000
Equity securities fair value	1,900,000
Equity Securities without readily determinable fair value, amount	2,500,000		$ 2,000,000.0
Federal Home Loan Bank Stock, at cost	17,236,000		$ 23,400,000
Impairment recognized	$ 0
Accounting Standards Update 2016-01 | Retained Earnings
Item Effected [Line Items]
Adoption of accounting standards update		$ 475,000

XML

SECURITIES - Available for Sale (Details) - USD ($) $ in Thousands	Jun. 30, 2019	Sep. 30, 2018
Available-for-sale debt securities [Abstract]
Fair Value	$ 395,201	$ 364,065
LESS THAN 12 MONTHS, Fair Value		950,499
LESS THAN 12 MONTHS, Unrealized (Losses)		(18,629)
OVER 12 MONTHS, Fair Value		601,825
OVER 12 MONTHS, Unrealized (Losses)		(29,244)
TOTAL, Fair Value		1,552,324
TOTAL, Unrealized (Losses)		(47,873)
AMORTIZED COST
Due in one year or less	0	2,532
Due after one year through five years	11,336	41,415
Due after five years through ten years	62,337	352,099
Due after ten years	885,263	1,118,283
Total	958,936	1,514,329
Mortgage-backed securities	395,059	378,301
Common equities and mutual funds		3,172
Amortized cost	1,353,995	1,895,802
FAIR VALUE
Due in one year or less	0	2,529
Due after one year through five years	11,711	41,504
Due after five years through ten years	64,221	350,143
Due after ten years	885,965	1,089,984
Total	961,897	1,484,160
Mortgage-backed securities	395,201	364,065
Common equities and mutual funds(1)		3,800
Total available for sale securities	1,357,098	1,852,025
Available-for-sale Securities [Member]
Available-for-sale debt securities [Abstract]
Amortized cost		1,895,802
Gross unrealized gains		4,096
Gross unrealized (losses)		(47,873)
Fair Value		1,852,025
Small Business Administration Securities
Available-for-sale debt securities [Abstract]
Amortized cost	189,816	45,591
Gross unrealized gains	3,271	1
Gross unrealized (losses)	(21)	(1,255)
Fair Value	193,066	44,337
LESS THAN 12 MONTHS, Fair Value	13,785	43,097
LESS THAN 12 MONTHS, Unrealized (Losses)	(21)	(1,255)
OVER 12 MONTHS, Fair Value	0	0
OVER 12 MONTHS, Unrealized (Losses)	0	0
TOTAL, Fair Value	13,785	43,097
TOTAL, Unrealized (Losses)	(21)	(1,255)
Obligations of States and Political Subdivisions
Available-for-sale debt securities [Abstract]
Amortized cost	858	17,154
Gross unrealized gains	17	49
Gross unrealized (losses)	0	(293)
Fair Value	875	16,910
LESS THAN 12 MONTHS, Fair Value	0	11,036
LESS THAN 12 MONTHS, Unrealized (Losses)	0	(279)
OVER 12 MONTHS, Fair Value	0	881
OVER 12 MONTHS, Unrealized (Losses)	0	(14)
TOTAL, Fair Value	0	11,917
TOTAL, Unrealized (Losses)	0	(293)
Non-bank Qualified Obligations of States and Political Subdivisions
Available-for-sale debt securities [Abstract]
Amortized cost	459,551	1,140,884
Gross unrealized gains	3,456	826
Gross unrealized (losses)	(2,347)	(31,825)
Fair Value	460,660	1,109,885
LESS THAN 12 MONTHS, Fair Value	0	626,693
LESS THAN 12 MONTHS, Unrealized (Losses)	0	(13,539)
OVER 12 MONTHS, Fair Value	230,117	358,095
OVER 12 MONTHS, Unrealized (Losses)	(2,347)	(18,286)
TOTAL, Fair Value	230,117	984,788
TOTAL, Unrealized (Losses)	(2,347)	(31,825)
Asset-backed Securities
Available-for-sale debt securities [Abstract]
Amortized cost	308,711	310,700
Gross unrealized gains	753	2,585
Gross unrealized (losses)	(2,168)	(257)
Fair Value	307,296	313,028
LESS THAN 12 MONTHS, Fair Value	134,246	146,638
LESS THAN 12 MONTHS, Unrealized (Losses)	(1,230)	(257)
OVER 12 MONTHS, Fair Value	62,450	0
OVER 12 MONTHS, Unrealized (Losses)	(938)	0
TOTAL, Fair Value	196,696	146,638
TOTAL, Unrealized (Losses)	(2,168)	(257)
Mortgage-backed Securities
Available-for-sale debt securities [Abstract]
Amortized cost	395,059	378,301
Gross unrealized gains	2,838	0
Gross unrealized (losses)	(2,696)	(14,236)
Fair Value	395,201	364,065
LESS THAN 12 MONTHS, Fair Value	0	121,217
LESS THAN 12 MONTHS, Unrealized (Losses)	0	(3,292)
OVER 12 MONTHS, Fair Value	172,718	242,849
OVER 12 MONTHS, Unrealized (Losses)	(2,696)	(10,944)
TOTAL, Fair Value	172,718	364,066
TOTAL, Unrealized (Losses)	(2,696)	(14,236)
Debt Securities
Available-for-sale debt securities [Abstract]
Amortized cost	1,353,995	1,892,630
Gross unrealized gains	10,335	3,461
Gross unrealized (losses)	(7,232)	(47,866)
Fair Value	1,357,098	1,848,225
LESS THAN 12 MONTHS, Fair Value	148,031	948,681
LESS THAN 12 MONTHS, Unrealized (Losses)	(1,251)	(18,622)
OVER 12 MONTHS, Fair Value	465,285	601,825
OVER 12 MONTHS, Unrealized (Losses)	(5,981)	(29,244)
TOTAL, Fair Value	613,316	1,550,506
TOTAL, Unrealized (Losses)	(7,232)	(47,866)
Common Equities and Mutual Funds
Available-for-sale debt securities [Abstract]
Amortized cost	3,593	3,172
Gross unrealized gains	826	635
Gross unrealized (losses)	0	(7)
Fair Value	4,419	3,800
LESS THAN 12 MONTHS, Fair Value	0	1,818
LESS THAN 12 MONTHS, Unrealized (Losses)	0	(7)
OVER 12 MONTHS, Fair Value	0	0
OVER 12 MONTHS, Unrealized (Losses)	0	0
TOTAL, Fair Value	0	1,818
TOTAL, Unrealized (Losses)	$ 0	$ (7)

XML

SECURITIES - Held to Maturity (Details) - USD ($) $ in Thousands	Jun. 30, 2019	Sep. 30, 2018
Debt Securities, Held-to-maturity, Fair Value to Amortized Cost [Abstract]
Gross unrealized gains	$ 15	$ 0
Gross unrealized (losses)	(2,619)	(11,180)
Securities held to maturity	142,938	160,563
Debt Securities, Held-to-maturity, Continuous Unrealized Loss Position [Abstract]
LESS THAN 12 MONTHS, Fair Value	0	5,767
LESS THAN 12 MONTHS, Unrealized (Losses)	0	(287)
OVER 12 MONTHS, Fair Value	136,719	154,796
OVER 12 MONTHS, Unrealized (Losses)	(2,619)	(10,893)
TOTAL, Fair Value	136,719	160,563
TOTAL, Unrealized (Losses)	(2,619)	(11,180)
AMORTIZED COST
Due after ten years	138,128	163,893
Total	138,128	163,893
Mortgage-backed securities	7,414	7,850
Total held to maturity securities at cost	145,542	171,743
FAIR VALUE
Due after ten years	135,643	153,135
Total	135,643	153,135
Mortgage-backed securities	7,295	7,428
Total held to maturity securities	142,938	160,563
Non-bank Qualified Obligations of States and Political Subdivisions
Debt Securities, Held-to-maturity, Fair Value to Amortized Cost [Abstract]
Gross unrealized gains	15	0
Gross unrealized (losses)	(2,500)	(10,758)
Securities held to maturity	135,643	153,135
Debt Securities, Held-to-maturity, Continuous Unrealized Loss Position [Abstract]
LESS THAN 12 MONTHS, Fair Value	0	5,767
LESS THAN 12 MONTHS, Unrealized (Losses)	0	(287)
OVER 12 MONTHS, Fair Value	129,424	147,368
OVER 12 MONTHS, Unrealized (Losses)	(2,500)	(10,471)
TOTAL, Fair Value	129,424	153,135
TOTAL, Unrealized (Losses)	(2,500)	(10,758)
AMORTIZED COST
Total held to maturity securities at cost	138,128	163,893
FAIR VALUE
Total held to maturity securities	135,643	153,135
Mortgage-backed Securities
Debt Securities, Held-to-maturity, Fair Value to Amortized Cost [Abstract]
Gross unrealized gains	0	0
Gross unrealized (losses)	(119)	(422)
Securities held to maturity	7,295	7,428
Debt Securities, Held-to-maturity, Continuous Unrealized Loss Position [Abstract]
LESS THAN 12 MONTHS, Fair Value	0	0
LESS THAN 12 MONTHS, Unrealized (Losses)	0	0
OVER 12 MONTHS, Fair Value	7,295	7,428
OVER 12 MONTHS, Unrealized (Losses)	(119)	(422)
TOTAL, Fair Value	7,295	7,428
TOTAL, Unrealized (Losses)	(119)	(422)
AMORTIZED COST
Total held to maturity securities at cost	7,414	7,850
FAIR VALUE
Total held to maturity securities	$ 7,295	$ 7,428

XML

RENTAL EQUIPMENT, NET Schedule of Rental Equipment (Details) - USD ($) $ in Thousands	Jun. 30, 2019	Sep. 30, 2018
Property, Plant and Equipment [Line Items]
Rental equipment, gross	$ 238,484	$ 157,372
Accumulated depreciation	(53,752)	(50,082)
Rental equipment, Net book value	184,732	107,290
Computers and IT networking equipment
Property, Plant and Equipment [Line Items]
Rental equipment, gross	38,360	53,035
Motor vehicles and other
Property, Plant and Equipment [Line Items]
Rental equipment, gross	56,359	43,505
Office furniture and equipment
Property, Plant and Equipment [Line Items]
Rental equipment, gross	3,233	3,590
Solar panels and equipment
Property, Plant and Equipment [Line Items]
Rental equipment, gross	$ 140,532	$ 57,242

XML

RENTAL EQUIPMENT, NET Schedule of Operating Leases, Future Minimum Payments (Details) $ in Thousands	Jun. 30, 2019 USD ($)
Property, Plant and Equipment [Abstract]
Remaining in 2019	$ 7,829
2020	26,938
2021	22,527
2022	15,911
2023	13,516
2024 and thereafter	28,309
Total	$ 115,030

XML

GOODWILL AND INTANGIBLE ASSETS Schedule of Goodwill (Details) - USD ($) $ in Thousands	9 Months Ended
	Jun. 30, 2019	Jun. 30, 2018
Goodwill [Roll Forward]
Beginning balance	$ 303,270	$ 98,723
Acquisitions	0	0
Measurement Period Adjustments	4,671
Impairment	0	0
Ending balance	307,941	98,723
Meta Payment Systems
Goodwill [Roll Forward]
Beginning balance	87,145	87,145
Acquisitions	0	0
Measurement Period Adjustments	0
Impairment	0	0
Ending balance	87,145	87,145
Banking
Goodwill [Roll Forward]
Beginning balance	216,125	11,578
Acquisitions	0	0
Measurement Period Adjustments	4,671
Impairment	0	0
Ending balance	220,796	11,578
Corporate Services/Other
Goodwill [Roll Forward]
Beginning balance	0	0
Acquisitions	0	0
Measurement Period Adjustments	0
Impairment	0	0
Ending balance	$ 0	$ 0

XML

GOODWILL AND INTANGIBLE ASSETS Schedule of Intangible Asses (Details) - USD ($)	3 Months Ended		9 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Finite-lived Intangible Assets [Roll Forward]
Balance as of September 30, 2018			$ 70,719,000	$ 52,178,000
Acquisitions during the period			100,000	85,000
Amortization during the period			(14,352,000)	(6,077,000)
Impairment on rental equipment			(314,000)	(88,000)
Balance as of June 30, 2019	$ 56,153,000	$ 46,098,000	56,153,000	46,098,000
Gross carrying amount					$ 109,880,000	$ 81,867,000
Accumulated amortization					(42,820,000)	(24,904,000)
Accumulated impairment					(10,907,000)	(10,865,000)
Balance as of June 30, 2019	56,153,000	46,098,000	70,719,000	52,178,000	56,153,000	46,098,000
Asset impairment charges	100,000	0		0
Other Intangible Assets
Finite-lived Intangible Assets [Roll Forward]
Balance as of September 30, 2018			7,980,000	8,638,000
Acquisitions during the period			100,000	85,000
Amortization during the period			(724,000)	(685,000)
Impairment on rental equipment			(314,000)	(88,000)
Balance as of June 30, 2019	7,042,000	7,950,000	7,042,000	7,950,000
Gross carrying amount					10,688,000	10,587,000
Accumulated amortization					(2,987,000)	(2,020,000)
Accumulated impairment					(659,000)	(617,000)
Balance as of June 30, 2019	7,042,000	7,950,000	7,980,000	8,638,000	7,042,000	7,950,000
Customer Relationships
Finite-lived Intangible Assets [Roll Forward]
Balance as of September 30, 2018			48,455,000	31,707,000
Acquisitions during the period			0	0
Amortization during the period			(12,504,000)	(4,548,000)
Impairment on rental equipment			0	0
Balance as of June 30, 2019	35,951,000	27,159,000	35,951,000	27,159,000
Gross carrying amount					82,088,000	57,810,000
Accumulated amortization					(35,889,000)	(20,403,000)
Accumulated impairment					(10,248,000)	(10,248,000)
Balance as of June 30, 2019	35,951,000	27,159,000	48,455,000	31,707,000	35,951,000	27,159,000
Noncompete Agreements
Finite-lived Intangible Assets [Roll Forward]
Balance as of September 30, 2018			1,297,000	1,782,000
Acquisitions during the period			0	0
Amortization during the period			(353,000)	(367,000)
Impairment on rental equipment			0	0
Balance as of June 30, 2019	944,000	1,415,000	944,000	1,415,000
Gross carrying amount					2,480,000	2,480,000
Accumulated amortization					(1,536,000)	(1,065,000)
Accumulated impairment					0	0
Balance as of June 30, 2019	944,000	1,415,000	1,297,000	1,782,000	944,000	1,415,000
Trademarks
Finite-lived Intangible Assets [Roll Forward]
Balance as of September 30, 2018			12,987,000	10,051,000
Acquisitions during the period			0	0
Amortization during the period			(771,000)	(477,000)
Impairment on rental equipment			0	0
Balance as of June 30, 2019	12,216,000	9,574,000	12,216,000	9,574,000
Gross carrying amount					14,624,000	10,990,000
Accumulated amortization					(2,408,000)	(1,416,000)
Accumulated impairment					0	0
Balance as of June 30, 2019	$ 12,216,000	$ 9,574,000	$ 12,987,000	$ 10,051,000	$ 12,216,000	$ 9,574,000
Refund Advantage Financial Services Inc | Noncompete Agreements
Finite-lived Intangible Assets [Roll Forward]
Useful life			3 years
Refund Advantage Financial Services Inc | Trademarks
Finite-lived Intangible Assets [Roll Forward]
Useful life			15 years
Minimum | Refund Advantage Financial Services Inc | Other Intangible Assets
Finite-lived Intangible Assets [Roll Forward]
Useful life			3 years
Minimum | Refund Advantage Financial Services Inc | Customer Relationships
Finite-lived Intangible Assets [Roll Forward]
Useful life			10 years
Maximum | Refund Advantage Financial Services Inc | Other Intangible Assets
Finite-lived Intangible Assets [Roll Forward]
Useful life			20 years
Maximum | Refund Advantage Financial Services Inc | Customer Relationships
Finite-lived Intangible Assets [Roll Forward]
Useful life			30 years

XML

GOODWILL AND INTANGIBLE ASSETS Schedule of Future Amortization (Details) - USD ($) $ in Thousands	Jun. 30, 2019	Sep. 30, 2018	Jun. 30, 2018	Sep. 30, 2017
Goodwill and Intangible Assets Disclosure [Abstract]
Remaining in 2019	$ 3,357
2020	10,986
2021	8,527
2022	6,402
2023	5,084
2024	4,367
Thereafter	17,430
Balance as of June 30, 2019	$ 56,153	$ 70,719	$ 46,098	$ 52,178

XML

STOCKHOLDERS' EQUITY (Details) - USD ($) $ / shares in Units, $ in Thousands		9 Months Ended
	Jun. 25, 2019	Jun. 30, 2019	Jun. 30, 2018	Mar. 26, 2019
Class of Stock [Line Items]
Stock repurchased during the period (in shares)		90,264	17,155
Stock repurchased during the period, value		$ 3,000	$ 1,400
Treasury Stock
Class of Stock [Line Items]
Stock repurchased and retired during period	$ 4,956	$ 43,000
Stock repurchased and retired during period (in shares)	114,558,000	1,574,734
Number of shares authorized to be repurchased (in shares)				2,000,000.0
Percent of outstanding shares authorized for repurchase				5.00%
Average cost per share (in dollars per share)		$ 27.31
Remaining number of shares authorized to be repurchased		425,266

XML

STOCK COMPENSATION (Details) - USD ($) $ / shares in Units, $ in Thousands	9 Months Ended	12 Months Ended
	Jun. 30, 2019	Sep. 30, 2018
Number of Shares
Options outstanding, beginning of period (in shares)	155,961
Granted (in shares)	0
Exercised (in shares)	(48,678)
Forfeited or expired (in shares)	(3,027)
Options outstanding, end of period (in shares)	104,256	155,961
Options exercisable, end of period (in shares)	104,256
Weighted Average Exercise Price
Options outstanding, beginning of period (in dollars per share)	$ 8.48
Granted (in dollars per share)	0
Exercised (in dollars per share)	9.07
Forfeited or expired (in dollars per share)	10.60
Options outstanding, end of period (in dollars per share)	8.14	$ 8.48
Options exercisable, end of period (in dollars per share)	$ 8.14
Weighted Average Remaining Contractual Term
Options outstanding	1 year 2 months 19 days	1 year 9 months 10 days
Options exercisable	1 year 2 months 19 days
Aggregate Intrinsic Value
Options outstanding, beginning of period	$ 2,974
Granted	0
Exercised	802
Forfeited or expired	33
Options outstanding, end of period	2,075	$ 2,974
Options exercisable, end of period	$ 2,075
Number of Shares
Nonvested shares outstanding, beginning of period (in shares)	1,005,813
Granted (in shares)	296,302
Vested (in shares)	(352,218)
Forfeited or expired (in shares)	(2,679)
Nonvested shares outstanding, end of period (in shares)	947,218	1,005,813
Weighted Average Fair Value at Grant
Nonvested shares outstanding, beginning of period (in dollars per share)	$ 29.89
Granted (in dollars per share)	24.84
Vested (in dollars per share)	26.77
Forfeited or expired (in dollars per share)	26.14
Nonvested shares outstanding, end of period (in dollars per share)	$ 29.48	$ 29.89
Stock based compensation expense not yet recognized in income	$ 13,500
Weighted average remaining period for unrecognized stock based compensation	3 years 1 month 2 days

XML

INCOME TAXES - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Income Tax Disclosure [Abstract]
Income tax expense	$ (1,158)	$ 476	$ (3,244)	$ 12,708
Effective tax rate			(4.20%)	22.90%

XML

INCOME TAXES - Schedule of Effective Income Tax Rate Reconciliation (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Income Tax Disclosure [Abstract]
Provision at statutory rate			$ 15,449	$ 13,639
Tax-exempt income			(2,360)	(5,506)
State income taxes			3,243	2,314
Interim period effective rate adjustment			1,397	(1,070)
Tax credit investments, net - federal			(22,484)	0
Tax Reform rate adjustment			0	3,635
IRC 162(m) nondeductible compensation			1,612	0
Other, net			(101)	(304)
Income tax expense	$ (1,158)	$ 476	$ (3,244)	$ 12,708
Effective tax rate			(4.20%)	22.90%

XML

COMMITMENTS AND CONTINGENCIES (Details)	Feb. 09, 2018 USD ($)	Jun. 30, 2019 USD ($) commitment	Dec. 24, 2018 USD ($)	Sep. 30, 2018 USD ($) commitment	Oct. 14, 2016 USD ($)
Loss Contingencies [Line Items]
Unfunded loan commitments		$ 1,010,000,000.00		$ 748,800,000
Number of investment commitments | commitment		1,700,000		1,400,000
Securities, buy (sell) obligations		$ 0		$ 0
Off-balance sheet credit exposures		$ 100,000		$ 100,000
Card Limited, LLC v. MetaBank dba Meta Payment Systems [Member]
Loss Contingencies [Line Items]
Estimate of possible loss					$ 4,000,000.0
AFS/IBEX, A Division of MetaBank V. Aegis Managing Agency Limited [Member]
Loss Contingencies [Line Items]
Damages sought amount	$ 1,600,000
Ohio Valley Bank Company V. Metabank dba Refund Advantage, Case No. 18 CV 134 [Member]
Loss Contingencies [Line Items]
Estimate of possible loss			$ 3,000,000.0

XML

REVENUE FROM CONTRACTS WITH CUSTOMERS - Narrative (Details) - USD ($)	Jun. 30, 2019	Oct. 01, 2018	Sep. 30, 2018
Disaggregation of Revenue [Line Items]
Retained earnings	$ 238,004,000		$ 213,048,000
Accounting Standards Update 2014-09
Disaggregation of Revenue [Line Items]
Adoption of accounting standards update		$ 1,502,000
Refund Transfer Fees
Disaggregation of Revenue [Line Items]
Accounts Receivable, before Allowance for Credit Loss, Current	$ 0		$ 827,039
Retained Earnings | Accounting Standards Update 2014-09
Disaggregation of Revenue [Line Items]
Adoption of accounting standards update		$ 1,502,000

XML

REVENUE FROM CONTRACTS WITH CUSTOMERS - Schedule of Revenue From Contracts with Customers by Segment (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Disaggregation of Revenue [Line Items]
Net interest income	$ 66,968	$ 28,411	$ 198,590	$ 82,012
Noninterest income	43,790	33,225	186,565	159,912
Revenues	110,758	61,636	385,155	241,924
Refund Transfer Fees
Disaggregation of Revenue [Line Items]
Noninterest income	6,697	7,358	38,559	41,353
Tax Advance Product Fees
Disaggregation of Revenue [Line Items]
Noninterest income	34	(46)	34,757	35,739
Credit Card
Disaggregation of Revenue [Line Items]
Noninterest income	19,537	22,807	61,939	74,910
Rental income
Disaggregation of Revenue [Line Items]
Noninterest income	9,386	0	30,167	0
Loan and Lease Fees
Disaggregation of Revenue [Line Items]
Noninterest income	1,012	1,111	3,185	3,445
Bank Owned Life Insurance
Disaggregation of Revenue [Line Items]
Noninterest income	628	633	1,901	1,952
Deposit Account
Disaggregation of Revenue [Line Items]
Noninterest income	2,335	1,134	6,365	2,964
Loss on Sale of Securities, Available for Sale
Disaggregation of Revenue [Line Items]
Noninterest income	440	(22)	649	(1,198)
Gain on Loans and Leases
Disaggregation of Revenue [Line Items]
Noninterest income	1,913	0	3,865	0
Loss on foreclosed real estate
Disaggregation of Revenue [Line Items]
Noninterest income			(185)	(19)
Other Revenues for Financial Assets and Liabilities
Disaggregation of Revenue [Line Items]
Noninterest income	1,808	250	5,363	766
Meta Payment Systems
Disaggregation of Revenue [Line Items]
Noninterest income	28,402	31,307	140,980	155,082
Corporate Services/Other
Disaggregation of Revenue [Line Items]
Noninterest income	1,805	600	3,786	786
Operating Segments | Meta Payment Systems
Disaggregation of Revenue [Line Items]
Net interest income	15,232	6,298	38,238	15,900
Noninterest income	28,402	31,307	140,980	155,082
Revenues	43,634	37,605	179,218	170,982
Operating Segments | Meta Payment Systems | Refund Transfer Fees
Disaggregation of Revenue [Line Items]
Noninterest income	6,697	7,358	38,559	41,353
Operating Segments | Meta Payment Systems | Tax Advance Product Fees
Disaggregation of Revenue [Line Items]
Noninterest income	34	(46)	34,757	35,739
Operating Segments | Meta Payment Systems | Credit Card
Disaggregation of Revenue [Line Items]
Noninterest income	19,445	22,717	61,678	74,662
Operating Segments | Meta Payment Systems | Rental income
Disaggregation of Revenue [Line Items]
Noninterest income	4	0	5	0
Operating Segments | Meta Payment Systems | Loan and Lease Fees
Disaggregation of Revenue [Line Items]
Noninterest income	0	0	0	0
Operating Segments | Meta Payment Systems | Bank Owned Life Insurance
Disaggregation of Revenue [Line Items]
Noninterest income	0	0	0	0
Operating Segments | Meta Payment Systems | Deposit Account
Disaggregation of Revenue [Line Items]
Noninterest income	1,932	1,027	5,177	2,634
Operating Segments | Meta Payment Systems | Loss on Sale of Securities, Available for Sale
Disaggregation of Revenue [Line Items]
Noninterest income	0	0	0	0
Operating Segments | Meta Payment Systems | Gain on Loans and Leases
Disaggregation of Revenue [Line Items]
Noninterest income	0	0	0	0
Operating Segments | Meta Payment Systems | Loss on foreclosed real estate
Disaggregation of Revenue [Line Items]
Noninterest income			0	0
Operating Segments | Meta Payment Systems | Other Revenues for Financial Assets and Liabilities
Disaggregation of Revenue [Line Items]
Noninterest income	290	251	804	694
Operating Segments | Banking
Disaggregation of Revenue [Line Items]
Net interest income	60,043	18,077	168,107	49,794
Noninterest income	13,583	1,318	41,799	4,044
Revenues	73,626	19,395	209,906	53,838
Operating Segments | Banking | Refund Transfer Fees
Disaggregation of Revenue [Line Items]
Noninterest income	0	0	0	0
Operating Segments | Banking | Tax Advance Product Fees
Disaggregation of Revenue [Line Items]
Noninterest income	0	0	0	0
Operating Segments | Banking | Credit Card
Disaggregation of Revenue [Line Items]
Noninterest income	92	90	261	248
Operating Segments | Banking | Rental income
Disaggregation of Revenue [Line Items]
Noninterest income	9,382	0	30,162	0
Operating Segments | Banking | Loan and Lease Fees
Disaggregation of Revenue [Line Items]
Noninterest income	1,012	1,111	3,185	3,445
Operating Segments | Banking | Bank Owned Life Insurance
Disaggregation of Revenue [Line Items]
Noninterest income	0	0	0	0
Operating Segments | Banking | Deposit Account
Disaggregation of Revenue [Line Items]
Noninterest income	403	107	1,188	330
Operating Segments | Banking | Loss on Sale of Securities, Available for Sale
Disaggregation of Revenue [Line Items]
Noninterest income	0	0	0	0
Operating Segments | Banking | Gain on Loans and Leases
Disaggregation of Revenue [Line Items]
Noninterest income	1,913	0	3,865	0
Operating Segments | Banking | Loss on foreclosed real estate
Disaggregation of Revenue [Line Items]
Noninterest income			(185)	(19)
Operating Segments | Banking | Other Revenues for Financial Assets and Liabilities
Disaggregation of Revenue [Line Items]
Noninterest income	781	10	3,323	40
Operating Segments | Corporate Services/Other
Disaggregation of Revenue [Line Items]
Net interest income	(8,307)	4,036	(7,755)	16,318
Noninterest income	1,805	600	3,786	786
Revenues	(6,502)	4,636	(3,969)	17,104
Operating Segments | Corporate Services/Other | Refund Transfer Fees
Disaggregation of Revenue [Line Items]
Noninterest income	0	0	0	0
Operating Segments | Corporate Services/Other | Tax Advance Product Fees
Disaggregation of Revenue [Line Items]
Noninterest income	0	0	0	0
Operating Segments | Corporate Services/Other | Credit Card
Disaggregation of Revenue [Line Items]
Noninterest income	0	0	0	0
Operating Segments | Corporate Services/Other | Rental income
Disaggregation of Revenue [Line Items]
Noninterest income	0	0	0	0
Operating Segments | Corporate Services/Other | Loan and Lease Fees
Disaggregation of Revenue [Line Items]
Noninterest income	0	0	0	0
Operating Segments | Corporate Services/Other | Bank Owned Life Insurance
Disaggregation of Revenue [Line Items]
Noninterest income	628	633	1,901	1,952
Operating Segments | Corporate Services/Other | Deposit Account
Disaggregation of Revenue [Line Items]
Noninterest income	0	0	0	0
Operating Segments | Corporate Services/Other | Loss on Sale of Securities, Available for Sale
Disaggregation of Revenue [Line Items]
Noninterest income	440	(22)	649	(1,198)
Operating Segments | Corporate Services/Other | Gain on Loans and Leases
Disaggregation of Revenue [Line Items]
Noninterest income	0	0	0	0
Operating Segments | Corporate Services/Other | Loss on foreclosed real estate
Disaggregation of Revenue [Line Items]
Noninterest income			0	0
Operating Segments | Corporate Services/Other | Other Revenues for Financial Assets and Liabilities
Disaggregation of Revenue [Line Items]
Noninterest income	$ 737	$ (11)	$ 1,236	$ 32

XML

FAIR VALUE MEASUREMENTS - Assets Measured at Fair Value on Recurring and Non-recurring Basis (Details) - USD ($) $ in Thousands	Jun. 30, 2019	Sep. 30, 2018
Available-for-sale debt securities [Abstract]
Mortgage-backed securities available for sale, at fair value	$ 395,201	$ 364,065
Total available for sale securities	1,357,098	1,852,025
Debt Securities, Held-to-maturity, Fair Value to Amortized Cost [Abstract]
Total held to maturity securities	142,938	160,563
Level 1
Fair Value, Assets Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value	0	0
Available-for-sale debt securities [Abstract]
Total available for sale securities	0	3,800
Debt Securities, Held-to-maturity, Fair Value to Amortized Cost [Abstract]
Total held to maturity securities	0	0
Level 2
Fair Value, Assets Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value	0	0
Available-for-sale debt securities [Abstract]
Total available for sale securities	1,357,098	1,848,225
Debt Securities, Held-to-maturity, Fair Value to Amortized Cost [Abstract]
Total held to maturity securities	142,938	160,974
Level 3
Fair Value, Assets Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value	3,569,853	2,927,755
Available-for-sale debt securities [Abstract]
Total available for sale securities	0	0
Debt Securities, Held-to-maturity, Fair Value to Amortized Cost [Abstract]
Total held to maturity securities	0	0
Nonrecurring
Fair Value, Assets Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value	33,557	36,463
Nonrecurring | Level 1
Fair Value, Assets Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value	0	0
Nonrecurring | Level 2
Fair Value, Assets Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value	0	0
Nonrecurring | Level 3
Fair Value, Assets Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value	33,557	36,463
Recurring
Available-for-sale debt securities [Abstract]
Small business administration securities	193,066	44,337
Obligations of states and political subdivisions	875	16,910
Non-bank qualified obligations of states and political subdivisions	460,660	1,109,885
Asset-baked securities	307,296	313,028
Mortgage-backed securities	395,201	364,065
Mortgage-backed securities available for sale, at fair value	1,357,098	1,848,225
Common equities and mutual funds	4,419	3,800
Total available for sale securities		1,852,025
Recurring | Level 1
Available-for-sale debt securities [Abstract]
Small business administration securities	0	0
Obligations of states and political subdivisions	0	0
Non-bank qualified obligations of states and political subdivisions	0	0
Asset-baked securities	0	0
Mortgage-backed securities	0	0
Mortgage-backed securities available for sale, at fair value	0	0
Common equities and mutual funds	4,419	3,800
Total available for sale securities		3,800
Recurring | Level 2
Available-for-sale debt securities [Abstract]
Small business administration securities	193,066	44,337
Obligations of states and political subdivisions	875	16,910
Non-bank qualified obligations of states and political subdivisions	460,660	1,109,885
Asset-baked securities	307,296	313,028
Mortgage-backed securities	395,201	364,065
Mortgage-backed securities available for sale, at fair value	1,357,098	1,848,225
Common equities and mutual funds	0	0
Total available for sale securities		1,848,225
Recurring | Level 3
Available-for-sale debt securities [Abstract]
Small business administration securities	0	0
Obligations of states and political subdivisions	0	0
Non-bank qualified obligations of states and political subdivisions	0	0
Asset-baked securities	0	0
Mortgage-backed securities	0	0
Mortgage-backed securities available for sale, at fair value	0	0
Common equities and mutual funds	0	0
Total available for sale securities		0
Asset based lending | Nonrecurring
Fair Value, Assets Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value	83	57
Asset based lending | Nonrecurring | Level 1
Fair Value, Assets Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value	0	0
Asset based lending | Nonrecurring | Level 2
Fair Value, Assets Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value	0	0
Asset based lending | Nonrecurring | Level 3
Fair Value, Assets Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value	83	57
Factoring | Nonrecurring
Fair Value, Assets Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value	3,960	1,899
Factoring | Nonrecurring | Level 1
Fair Value, Assets Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value	0	0
Factoring | Nonrecurring | Level 2
Fair Value, Assets Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value	0	0
Factoring | Nonrecurring | Level 3
Fair Value, Assets Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value	3,960	1,899
Lease financing | Nonrecurring
Fair Value, Assets Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value		2,869
Lease financing | Nonrecurring | Level 1
Fair Value, Assets Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value		0
Lease financing | Nonrecurring | Level 2
Fair Value, Assets Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value		0
Lease financing | Nonrecurring | Level 3
Fair Value, Assets Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value		2,869
Commercial Portfolio Segment | Nonrecurring
Fair Value, Assets Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value	4,043	4,825
Commercial Portfolio Segment | Nonrecurring | Level 1
Fair Value, Assets Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value	0	0
Commercial Portfolio Segment | Nonrecurring | Level 2
Fair Value, Assets Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value	0	0
Commercial Portfolio Segment | Nonrecurring | Level 3
Fair Value, Assets Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value	$ 4,043	$ 4,825

XML

SEGMENT REPORTING (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2019 USD ($)	Jun. 30, 2018 USD ($)	Jun. 30, 2019 USD ($) segment	Jun. 30, 2018 USD ($)	Sep. 30, 2018 USD ($)	Sep. 30, 2017 USD ($)
Segment Reporting Information [Line Items]
Number of reportable segments | segment			3
Segment data [Abstract]
Net interest income	$ 66,968	$ 28,411	$ 198,590	$ 82,012
Provision for loan and lease losses	9,112	5,315	51,529	24,726
Noninterest income	43,790	33,225	186,565	159,912
Noninterest expense	72,468	49,053	257,016	161,592
Income (loss) before income tax expense (benefit)	29,178	7,268	76,610	55,606
Total assets	6,101,072	4,169,159	6,101,072	4,169,159	$ 5,835,067
Goodwill	307,941	98,723	307,941	98,723	303,270	$ 98,723
Total deposits	4,775,214	3,521,633	4,775,214	3,521,633	4,430,987
Meta Payment Systems
Segment data [Abstract]
Net interest income	15,232	6,298	38,238	15,900
Provision for loan and lease losses	914	1,189	24,883	20,335
Noninterest income	28,402	31,307	140,980	155,082
Noninterest expense	17,559	27,796	71,098	99,592
Income (loss) before income tax expense (benefit)	25,161	8,620	83,237	51,055
Total assets	196,257	190,437	196,257	190,437
Goodwill	87,145	87,145	87,145	87,145	87,145	87,145
Total deposits	2,795,009	2,641,838	2,795,009	2,641,838
Banking
Segment data [Abstract]
Net interest income	60,043	18,077	168,107	49,794
Provision for loan and lease losses	8,198	4,126	26,646	4,391
Noninterest income	13,583	1,318	41,799	4,044
Noninterest expense	33,233	7,172	109,598	20,723
Income (loss) before income tax expense (benefit)	32,195	8,097	73,662	28,724
Total assets	4,169,351	1,623,715	4,169,351	1,623,715
Goodwill	220,796	11,578	220,796	11,578	216,125	11,578
Total deposits	297,861	241,572	297,861	241,572
Corporate Services/Other
Segment data [Abstract]
Net interest income	(8,307)	4,036	(7,755)	16,318
Provision for loan and lease losses	0	0	0	0
Noninterest income	1,805	600	3,786	786
Noninterest expense	21,676	14,085	76,320	41,277
Income (loss) before income tax expense (benefit)	(28,178)	(9,449)	(80,289)	(24,173)
Total assets	1,735,464	2,355,007	1,735,464	2,355,007
Goodwill	0	0	0	0	$ 0	$ 0
Total deposits	$ 1,682,344	$ 638,223	$ 1,682,344	$ 638,223

XML

FAIR VALUE MEASUREMENTS - Quantitative Information (Details) - USD ($) $ in Thousands	9 Months Ended
	Jun. 30, 2019	Sep. 30, 2018
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Foreclosed assets, net	$ 29,514	$ 31,638
Minimum
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Range of estimated selling cost	4.00%
Maximum
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Range of estimated selling cost	30.00%
Level 1
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	$ 0	0
Level 2
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	0	0
Level 3
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	3,569,853	2,927,755
Impaired Loans [Member] | Level 3 | Valuation, Market Approach
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	4,043	4,825
Foreclosed Assets | Level 3 | Valuation, Market Approach
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	29,514	31,638
Nonrecurring
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	33,557	36,463
Nonrecurring | Level 1
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	0	0
Nonrecurring | Level 2
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	0	0
Nonrecurring | Level 3
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	33,557	36,463
Nonrecurring | Lease financing
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value		2,869
Nonrecurring | Lease financing | Level 1
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value		0
Nonrecurring | Lease financing | Level 2
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value		0
Nonrecurring | Lease financing | Level 3
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value		2,869
Nonrecurring | Commercial Portfolio Segment
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	4,043	4,825
Nonrecurring | Commercial Portfolio Segment | Level 1
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	0	0
Nonrecurring | Commercial Portfolio Segment | Level 2
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	0	0
Nonrecurring | Commercial Portfolio Segment | Level 3
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	4,043	4,825
Nonrecurring | Total National Lending
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	4,043	4,825
Nonrecurring | Total National Lending | Level 1
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	0	0
Nonrecurring | Total National Lending | Level 2
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	0	0
Nonrecurring | Total National Lending | Level 3
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	4,043	4,825
Nonrecurring | Agricultural Operating
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value		4,825
Nonrecurring | Agricultural Operating | Level 1
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value		0
Nonrecurring | Agricultural Operating | Level 2
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value		0
Nonrecurring | Agricultural Operating | Level 3
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value		4,825
Nonrecurring | Impaired Loans [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	4,043
Nonrecurring | Impaired Loans [Member] | Level 1
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	0
Nonrecurring | Impaired Loans [Member] | Level 2
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	0
Nonrecurring | Impaired Loans [Member] | Level 3
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	4,043
Nonrecurring | Asset based lending
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	83	57
Nonrecurring | Asset based lending | Level 1
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	0	0
Nonrecurring | Asset based lending | Level 2
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	0	0
Nonrecurring | Asset based lending | Level 3
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	83	57
Nonrecurring | Factoring
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	3,960	1,899
Nonrecurring | Factoring | Level 1
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	0	0
Nonrecurring | Factoring | Level 2
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	0	0
Nonrecurring | Factoring | Level 3
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Fair value	3,960	1,899
Nonrecurring | Foreclosed Assets
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Foreclosed assets, net	29,514	31,638
Nonrecurring | Foreclosed Assets | Level 1
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Foreclosed assets, net	0	0
Nonrecurring | Foreclosed Assets | Level 2
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Foreclosed assets, net	0	0
Nonrecurring | Foreclosed Assets | Level 3
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31)
Foreclosed assets, net	$ 29,514	$ 31,638

XML

FAIR VALUE MEASUREMENTS - Balance Sheet Grouping (Details) - USD ($) $ in Thousands	Jun. 30, 2019	Sep. 30, 2018
Financial assets [Abstract]
Securities available for sale	$ 1,357,098	$ 1,852,025
Securities held to maturity	142,938	160,563
Equity Securities, FV-NI	1,900
Financial liabilities [Abstract]
Long-term borrowings	209,765	88,963
Subordinated debentures	146,613	425,759
Level 1
Financial assets [Abstract]
Cash and cash equivalents	100,732	99,977
Securities available for sale	0	3,800
Securities held to maturity	0	0
Equity Securities, FV-NI	4,419
Total securities	4,419	3,800
Trade and Loans Receivables Held-for-sale, Net, Not Part of Disposal Group	0	0
Loans receivable [Abstract]
Total loans receivable	0	0
Federal Home Loan Bank stock	0	0
Accrued interest receivable, fair value disclosure	19,722	22,016
Financial liabilities [Abstract]
Noninterest bearing demand deposits	2,751,931	2,405,274
Interest bearing demand deposits, savings, and money markets	278,585	218,347
Certificates of deposit	0	0
Wholesale non-maturing deposits	216,598	94,384
Wholesale time certificates of deposits	0	0
Total deposits	3,247,114	2,718,005
Overnight federal funds purchased	135,000
Federal fund purchased	0	422,000
Securities sold under agreements to repurchase	0	0
Long-term borrowings	0	0
Trust preferred securities	0	0
Subordinated debentures	0	0
Other borrowings	0
Accrued interest payable	12,350	7,794
Level 2
Financial assets [Abstract]
Cash and cash equivalents	0	0
Securities available for sale	1,357,098	1,848,225
Securities held to maturity	142,938	160,974
Equity Securities, FV-NI	0
Total securities	1,500,036	2,009,199
Trade and Loans Receivables Held-for-sale, Net, Not Part of Disposal Group	62,839	15,606
Loans receivable [Abstract]
Total loans receivable	0	0
Federal Home Loan Bank stock	17,236	23,400
Accrued interest receivable, fair value disclosure	0	0
Financial liabilities [Abstract]
Noninterest bearing demand deposits	0	0
Interest bearing demand deposits, savings, and money markets	0	0
Certificates of deposit	116,657	273,800
Wholesale non-maturing deposits	0	0
Wholesale time certificates of deposits	1,412,931	1,432,146
Total deposits	1,529,588	1,705,946
Overnight federal funds purchased	0
Federal fund purchased	110,578	0
Securities sold under agreements to repurchase	3,658	3,694
Long-term borrowings	1,972	1,876
Trust preferred securities	13,879	13,866
Subordinated debentures	76,875	75,563
Other borrowings	18,307
Accrued interest payable	0	0
Level 3
Financial assets [Abstract]
Cash and cash equivalents	0	0
Securities available for sale	0	0
Securities held to maturity	0	0
Equity Securities, FV-NI	0
Total securities	0	0
Trade and Loans Receivables Held-for-sale, Net, Not Part of Disposal Group	0	0
Loans receivable [Abstract]
Total loans receivable	3,569,853	2,927,755
Federal Home Loan Bank stock	0	0
Accrued interest receivable, fair value disclosure	0	0
Financial liabilities [Abstract]
Noninterest bearing demand deposits	0	0
Interest bearing demand deposits, savings, and money markets	0	0
Certificates of deposit	0	0
Wholesale non-maturing deposits	0	0
Wholesale time certificates of deposits	0	0
Total deposits	0	0
Overnight federal funds purchased	0
Federal fund purchased	0	0
Securities sold under agreements to repurchase	0	0
Long-term borrowings	0	0
Trust preferred securities	0	0
Subordinated debentures	0	0
Other borrowings	0
Accrued interest payable	0	0
Carrying Amount
Financial assets [Abstract]
Cash and cash equivalents	100,732	99,977
Securities available for sale	1,357,098	1,852,025
Securities held to maturity	145,542	172,154
Equity Securities, FV-NI	4,419
Total securities	1,507,059	2,024,179
Trade and Loans Receivables Held-for-sale, Net, Not Part of Disposal Group	62,839	15,606
Loans receivable [Abstract]
Total loans receivable	3,625,963	2,944,989
Federal Home Loan Bank stock	17,236	23,400
Accrued interest receivable, fair value disclosure	19,722	22,016
Financial liabilities [Abstract]
Noninterest bearing demand deposits	2,751,931	2,405,274
Interest bearing demand deposits, savings, and money markets	278,585	218,347
Certificates of deposit	116,698	276,180
Wholesale non-maturing deposits	216,598	94,384
Wholesale time certificates of deposits	1,411,402	1,436,802
Total deposits	4,775,214	4,430,987
Overnight federal funds purchased	135,000
Federal fund purchased	110,000	422,000
Securities sold under agreements to repurchase	3,658	3,694
Long-term borrowings	1,972	1,876
Trust preferred securities	13,661	13,661
Subordinated debentures	73,605	73,491
Other borrowings	18,482
Accrued interest payable	12,350	7,794
Estimated Fair Value
Financial assets [Abstract]
Cash and cash equivalents	100,732	99,977
Securities available for sale	1,357,098	1,852,025
Securities held to maturity	142,938	160,974
Equity Securities, FV-NI	4,419
Total securities	1,504,455	2,012,999
Trade and Loans Receivables Held-for-sale, Net, Not Part of Disposal Group	62,839	15,606
Loans receivable [Abstract]
Total loans receivable	3,569,853	2,927,755
Federal Home Loan Bank stock	17,236	23,400
Accrued interest receivable, fair value disclosure	19,722	22,016
Financial liabilities [Abstract]
Noninterest bearing demand deposits	2,751,931	2,405,274
Interest bearing demand deposits, savings, and money markets	278,585	218,347
Certificates of deposit	116,657	273,800
Wholesale non-maturing deposits	216,598	94,384
Wholesale time certificates of deposits	1,412,931	1,432,146
Total deposits	4,776,702	4,423,951
Overnight federal funds purchased	135,000
Federal fund purchased	110,578	422,000
Securities sold under agreements to repurchase	3,658	3,694
Long-term borrowings	1,972	1,876
Trust preferred securities	13,879	13,866
Subordinated debentures	76,875	75,563
Other borrowings	18,307
Accrued interest payable	12,350	7,794
Loans Receivable | Level 1
Loans receivable [Abstract]
Total loans receivable	0	0
Loans Receivable | Level 2
Loans receivable [Abstract]
Total loans receivable	0	0
Loans Receivable | Level 3
Loans receivable [Abstract]
Total loans receivable	1,185,354	1,076,782
Loans Receivable | Carrying Amount
Loans receivable [Abstract]
Total loans receivable	1,195,434	1,098,706
Loans Receivable | Estimated Fair Value
Loans receivable [Abstract]
Total loans receivable	1,185,354	1,076,782
Loans Receivable | SBA/USDA | Level 1
Loans receivable [Abstract]
Total loans receivable	0	0
Loans Receivable | SBA/USDA | Level 2
Loans receivable [Abstract]
Total loans receivable	0	0
Loans Receivable | SBA/USDA | Level 3
Loans receivable [Abstract]
Total loans receivable	94,391	61,072
Loans Receivable | SBA/USDA | Carrying Amount
Loans receivable [Abstract]
Total loans receivable	99,791	59,374
Loans Receivable | SBA/USDA | Estimated Fair Value
Loans receivable [Abstract]
Total loans receivable	94,391	61,072
Loans Receivable | Other commercial finance | Level 1
Loans receivable [Abstract]
Total loans receivable	0	0
Loans Receivable | Other commercial finance | Level 2
Loans receivable [Abstract]
Total loans receivable	0	0
Loans Receivable | Other commercial finance | Level 3
Loans receivable [Abstract]
Total loans receivable	101,145	83,111
Loans Receivable | Other commercial finance | Carrying Amount
Loans receivable [Abstract]
Total loans receivable	99,677	85,145
Loans Receivable | Other commercial finance | Estimated Fair Value
Loans receivable [Abstract]
Total loans receivable	101,145	83,111
Loans Receivable | Commercial finance | Level 1
Loans receivable [Abstract]
Total loans receivable	0	0
Loans Receivable | Commercial finance | Level 2
Loans receivable [Abstract]
Total loans receivable	0	0
Loans Receivable | Commercial finance | Level 3
Loans receivable [Abstract]
Total loans receivable	1,808,683	1,506,969
Loans Receivable | Commercial finance | Carrying Amount
Loans receivable [Abstract]
Total loans receivable	1,835,850	1,509,849
Loans Receivable | Commercial finance | Estimated Fair Value
Loans receivable [Abstract]
Total loans receivable	1,808,683	1,506,969
Loans Receivable | Consumer credit products | Level 1
Loans receivable [Abstract]
Total loans receivable	0	0
Loans Receivable | Consumer credit products | Level 2
Loans receivable [Abstract]
Total loans receivable	0	0
Loans Receivable | Consumer credit products | Level 3
Loans receivable [Abstract]
Total loans receivable	156,539	80,633
Loans Receivable | Consumer credit products | Carrying Amount
Loans receivable [Abstract]
Total loans receivable	155,539	80,605
Loans Receivable | Consumer credit products | Estimated Fair Value
Loans receivable [Abstract]
Total loans receivable	156,539	80,633
Loans Receivable | Other consumer finance | Level 1
Loans receivable [Abstract]
Total loans receivable	0	0
Loans Receivable | Other consumer finance | Level 2
Loans receivable [Abstract]
Total loans receivable	0	0
Loans Receivable | Other consumer finance | Level 3
Loans receivable [Abstract]
Total loans receivable	160,239	197,320
Loans Receivable | Other consumer finance | Carrying Amount
Loans receivable [Abstract]
Total loans receivable	164,727	189,756
Loans Receivable | Other consumer finance | Estimated Fair Value
Loans receivable [Abstract]
Total loans receivable	160,239	197,320
Loans Receivable | Consumer finance | Level 1
Loans receivable [Abstract]
Total loans receivable	0	0
Loans Receivable | Consumer finance | Level 2
Loans receivable [Abstract]
Total loans receivable	0	0
Loans Receivable | Consumer finance | Level 3
Loans receivable [Abstract]
Total loans receivable	316,778	277,953
Loans Receivable | Consumer finance | Carrying Amount
Loans receivable [Abstract]
Total loans receivable	320,266	270,361
Loans Receivable | Consumer finance | Estimated Fair Value
Loans receivable [Abstract]
Total loans receivable	316,778	277,953
Loans Receivable | Tax services | Level 1
Loans receivable [Abstract]
Total loans receivable	0	0
Loans Receivable | Tax services | Level 2
Loans receivable [Abstract]
Total loans receivable	0	0
Loans Receivable | Tax services | Level 3
Loans receivable [Abstract]
Total loans receivable	8,985	1,073
Loans Receivable | Tax services | Carrying Amount
Loans receivable [Abstract]
Total loans receivable	24,410	1,073
Loans Receivable | Tax services | Estimated Fair Value
Loans receivable [Abstract]
Total loans receivable	8,985	1,073
Loans Receivable | Warehouse finance | Level 1
Loans receivable [Abstract]
Total loans receivable	0	0
Loans Receivable | Warehouse finance | Level 2
Loans receivable [Abstract]
Total loans receivable	0	0
Loans Receivable | Warehouse finance | Level 3
Loans receivable [Abstract]
Total loans receivable	250,053	64,978
Loans Receivable | Warehouse finance | Carrying Amount
Loans receivable [Abstract]
Total loans receivable	250,003	65,000
Loans Receivable | Warehouse finance | Estimated Fair Value
Loans receivable [Abstract]
Total loans receivable	250,053	64,978
Loans Receivable | Total National Lending | Level 1
Loans receivable [Abstract]
Total loans receivable	0	0
Loans Receivable | Total National Lending | Level 2
Loans receivable [Abstract]
Total loans receivable	0	0
Loans Receivable | Total National Lending | Level 3
Loans receivable [Abstract]
Total loans receivable	2,384,499	1,850,973
Loans Receivable | Total National Lending | Carrying Amount
Loans receivable [Abstract]
Total loans receivable	2,430,529	1,846,283
Loans Receivable | Total National Lending | Estimated Fair Value
Loans receivable [Abstract]
Total loans receivable	2,384,499	1,850,973
Loans Receivable | Commercial real estate and operating | Level 1
Loans receivable [Abstract]
Total loans receivable	0	0
Loans Receivable | Commercial real estate and operating | Level 2
Loans receivable [Abstract]
Total loans receivable	0	0
Loans Receivable | Commercial real estate and operating | Level 3
Loans receivable [Abstract]
Total loans receivable	867,725	773,203
Loans Receivable | Commercial real estate and operating | Carrying Amount
Loans receivable [Abstract]
Total loans receivable	877,412	790,890
Loans Receivable | Commercial real estate and operating | Estimated Fair Value
Loans receivable [Abstract]
Total loans receivable	867,725	773,203
Loans Receivable | Consumer one to four family real estate and other | Level 1
Loans receivable [Abstract]
Total loans receivable	0	0
Loans Receivable | Consumer one to four family real estate and other | Level 2
Loans receivable [Abstract]
Total loans receivable	0	0
Loans Receivable | Consumer one to four family real estate and other | Level 3
Loans receivable [Abstract]
Total loans receivable	258,359	244,730
Loans Receivable | Consumer one to four family real estate and other | Carrying Amount
Loans receivable [Abstract]
Total loans receivable	256,853	247,318
Loans Receivable | Consumer one to four family real estate and other | Estimated Fair Value
Loans receivable [Abstract]
Total loans receivable	258,359	244,730
Loans Receivable | Agricultural real estate and operating | Level 1
Loans receivable [Abstract]
Total loans receivable	0	0
Loans Receivable | Agricultural real estate and operating | Level 2
Loans receivable [Abstract]
Total loans receivable	0	0
Loans Receivable | Agricultural real estate and operating | Level 3
Loans receivable [Abstract]
Total loans receivable	59,270	58,849
Loans Receivable | Agricultural real estate and operating | Carrying Amount
Loans receivable [Abstract]
Total loans receivable	61,169	60,498
Loans Receivable | Agricultural real estate and operating | Estimated Fair Value
Loans receivable [Abstract]
Total loans receivable	59,270	58,849
Financing Receivable | Asset based lending | Level 1
Loans receivable [Abstract]
Total loans receivable	0	0
Financing Receivable | Asset based lending | Level 2
Loans receivable [Abstract]
Total loans receivable	0	0
Financing Receivable | Asset based lending | Level 3
Loans receivable [Abstract]
Total loans receivable	599,664	477,471
Financing Receivable | Asset based lending | Carrying Amount
Loans receivable [Abstract]
Total loans receivable	615,309	477,917
Financing Receivable | Asset based lending | Estimated Fair Value
Loans receivable [Abstract]
Total loans receivable	599,664	477,471
Financing Receivable | Factoring | Level 1
Loans receivable [Abstract]
Total loans receivable	0	0
Financing Receivable | Factoring | Level 2
Loans receivable [Abstract]
Total loans receivable	0	0
Financing Receivable | Factoring | Level 3
Loans receivable [Abstract]
Total loans receivable	316,278	283,424
Financing Receivable | Factoring | Carrying Amount
Loans receivable [Abstract]
Total loans receivable	320,344	284,221
Financing Receivable | Factoring | Estimated Fair Value
Loans receivable [Abstract]
Total loans receivable	316,278	283,424
Financing Receivable | Lease financing | Level 1
Loans receivable [Abstract]
Total loans receivable	0	0
Financing Receivable | Lease financing | Level 2
Loans receivable [Abstract]
Total loans receivable	0	0
Financing Receivable | Lease financing | Level 3
Loans receivable [Abstract]
Total loans receivable	338,804	264,679
Financing Receivable | Lease financing | Carrying Amount
Loans receivable [Abstract]
Total loans receivable	341,957	265,315
Financing Receivable | Lease financing | Estimated Fair Value
Loans receivable [Abstract]
Total loans receivable	338,804	264,679
Financing Receivable | Insurance premium finance | Level 1
Loans receivable [Abstract]
Total loans receivable	0	0
Financing Receivable | Insurance premium finance | Level 2
Loans receivable [Abstract]
Total loans receivable	0	0
Financing Receivable | Insurance premium finance | Level 3
Loans receivable [Abstract]
Total loans receivable	358,401	337,212
Financing Receivable | Insurance premium finance | Carrying Amount
Loans receivable [Abstract]
Total loans receivable	358,772	337,877
Financing Receivable | Insurance premium finance | Estimated Fair Value
Loans receivable [Abstract]
Total loans receivable	$ 358,401	$ 337,212

XML

Label	Element	Value
Retained Earnings [Member]
Stock Repurchased and Retired During Period, Value	us-gaap_StockRepurchasedAndRetiredDuringPeriodValue	$ (4,956,000)
Accounting Standards Update 2014-09 [Member] | Parent [Member]
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	1,502,000
Accounting Standards Update 2016-01 [Member] | AOCI Attributable to Parent [Member]
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	$ (475,000)