Key points for investors:
- Strong loan growth and profitability: Axos reported over $700 million of net loan growth in the quarter (3.6% linked-quarter, 14.5% annualized), net income of ~$105.2M, diluted EPS of $1.81, 16% return on average common equity and 1.8% return on average assets. Book value per share rose ~19% year-over-year.
- Net interest income and margin: Net interest income was $275M (up 5.3% YoY). Consolidated NIM was 4.78% (down 5 bps YoY); management expects NIM ex FDIC accretion to remain at the high end of its 4.25%–4.35% target range. Excess liquidity was a modest drag on NIM (13 bps this quarter).
- Deposits and funding: Ending deposits were $20.1B (up 5.4% YoY). Demand, money market and savings represent the vast majority of deposits; the company is growing lower-cost deposits through products like Axos ONE and cross-sells into lending verticals. Axos Clearing custody deposits were $1.34B with $900M on-balance-sheet.
- Credit and reserves: Credit metrics improved — nonaccrual loans declined by $66.5M, NPLs down to 0.79% of assets. Net annualized charge-offs remained low (~9 bps including insured autos; 8 bps ex-insured). CECL-driven allowance movement reflected model inputs and macro assumptions; management says credit remains sound and many nonperformers are current or par-sold.
- Capital deployment and buybacks: Management repurchased ~$28M of common stock in the quarter and bought an additional $30.3M (517k shares) in April, citing excess capital and attractive valuation. Capital ratios remain strong.
- Expense management and investments: Noninterest expense was well-controlled (~$146M). Management is focused on operating efficiency and expects to limit personnel cost growth relative to revenue. They continue investing in technology, AI and platform modernization (clearing workstation, Axos Invest), which they expect to drive future operating leverage.
- Guidance and pipeline: Management reiterated expected organic loan growth of high single digits to low teens annually (excluding FDIC purchase portfolio) and noted a healthy pipeline (~$2.1B as of April 25, 2025). They flagged potential quarter-to-quarter volatility driven by prepayments and macro uncertainty.
- Notable risks/other items: Potential California tax apportionment change could reduce deferred tax assets by ~$6–7M (noncash) but lower future effective tax rate by ~3% (~$5M per quarter) if enacted. Management highlighted ongoing volatility in markets (client cash sorting) and the uncertain macro/interest-rate environment but expressed confidence in deposit and loan growth opportunities.
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