0000708781FALSE00007087812025-01-232025-01-23

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________
FORM 8-K
______________________
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (date of earliest event reported): January 23, 2025
______________________
CASS INFORMATION SYSTEMS, INC.
(Exact name of registrant as specified in its charter)
______________________
Missouri000-2082743-1265338
(State or other jurisdiction of
incorporation or organization)		(Commission
File Number)		(I.R.S. Employer
Identification No.)
12444 Powerscourt Drive, Suite 550
St. Louis, Missouri
63131
(Address of principal executive offices)(Zip Code)
(314) 506-5500
(Registrant’s telephone number, including area code)
______________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐
Written communications pursuant to Rule 425 under the Securities Act.
☐
Soliciting material pursuant to Rule 14a-12 under the Exchange Act.
☐
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act.
☐
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act.
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading
Symbol		Name of each exchange
on which registered
Common Stock, par value $0.50 per shareCASSNasdaq Global Select Market
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
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. ☐


Item 2.02.    Results of Operations and Financial Condition.
On January 23, 2025, Cass Information Systems, Inc. (the “Company”) issued a press release announcing its financial results for the fourth quarter of fiscal 2024. A copy of this press release is attached hereto as Exhibit 99.1 and incorporated herein by reference.

Also on January 23, 2025, the Company made available on the Investors section of the Company’s website at www.cassinfo.com, an investor presentation that includes information about the Company’s business and developments and certain financial information relating to the fourth quarter of fiscal 2024. The information contained in the investor presentation is summary information that is intended to be considered in the context of the Company’s Securities and Exchange Commission filings and other public announcements that the Company may make, by press release or otherwise, from time to time. A copy of this investor presentation is attached hereto as Exhibit 99.2 and incorporated herein by reference.

The Company has used, and intends to continue using, the Investors portion of its website to disclose material non-public information and to comply with its disclosure obligations under Regulation FD. Accordingly, investors are encouraged to monitor the Company’s website in addition to following press releases, SEC filings, and public conference calls and webcasts.

The information reported under this Item 2.02 of Form 8-K, including Exhibit 99.1 and Exhibit 99.2, is being furnished and shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of such section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 8.01.    Other Events.
On January 21, 2025, the Company’s Board of Directors declared a first quarter dividend of $0.31 per share payable on March 14, 2025 to shareholders of record on March 4, 2025.
Item 9.01.    Financial Statements and Exhibits.
(d)    Exhibits.
Exhibit NumberDescription
99.1
99.2
104 Cover Page Interactive Data File (embedded within the Inline XBRL document).
2

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 hereunto duly authorized.
Dated: January 23, 2025
CASS INFORMATION SYSTEMS, INC.
By:/s/ Martin H. Resch
Name:Martin H. Resch
Title:President and Chief Executive Officer
By:/s/ Michael J. Normile
Name:Michael J. Normile
Title:Executive Vice President and Chief Financial Officer
3

Exhibit 99.1
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Contact: Cass Investor Relations
ir@cassinfo.com
January 23, 2025
Cass Information Systems Reports Fourth Quarter 2024 Results
Fourth Quarter Results
(All comparisons refer to the fourth quarter of 2023, except as noted)

•Net income of $4.6 million, or $0.33 per diluted common share.
•Successfully terminated defined benefit pension plan resulting in one-time expense of $3.5 million.
•Increase in net interest margin to 3.55% from 3.30%.
•Increase in facility expense transaction volumes of 20.3%.
•Completed acquisition of AcuAudit from Acuitive Solutions LLC.
•Maintained exceptional credit quality, with no non-performing loans or charge-offs.
•Repurchased 79,713 shares of Company stock at weighted average price of $44.02.

ST. LOUIS – Cass Information Systems, Inc. (Nasdaq: CASS), (the Company or Cass) reported fourth quarter 2024 earnings of $0.33 per diluted share, as compared to $0.61 in the fourth quarter of 2023 and $0.21 in the third quarter of 2024. Net income for the period was $4.6 million, a decrease of 45.4% from $8.4 million in the same period in 2023 and an increase of $2.9 million, or 56.4%, as compared to the third quarter of 2024. For the year ended December 31, 2024, the Company reported net income and earnings per diluted share of $19.2 million and $1.39, respectively, as compared to $30.1 million and $2.18, respectively, for the year ended December 31, 2023.

Martin Resch, the Company’s President and Chief Executive Officer, noted, “We closed 2024 operationally on a strong note and have significant momentum for enhanced profitability as we enter 2025. We expect our net interest margin to continue to increase given the current interest rate environment. We see average earning assets returning to the level we had prior to the cyber event at our CassPay client, which resulted in a $100 million balance decrease early in 2024. We have leveraged our new AI enabled technology platforms to gain operating efficiencies in our payments business, and will continue to do so throughout 2025, resulting in lower headcount even as our transaction volumes continue to increase. The launch of Amplify, our partnership with Lupeon and our acquisition of AcuAudit provides us with a unique opportunity to market a best-in-class transportation payments solution, covering all geographies and transportation modes. The termination of the defined benefit pension plan will remove close to $1 million of annual operating costs. Finally, and most importantly, we continue to win new business reflecting our market leadership position and trust that our clients have in our ability to deliver value.”

Resch continued, “Net income during 2024 was negatively impacted by a combination of $7.8 million of bad debt expense on a funding receivable related to a facility client, a pension termination loss of $3.5 million and the cyber event at a CassPay client. These events and their related financial impact are now behind us and we have significant tailwinds as described above. These tailwinds, combined with indications that freight indices are approaching positive territory for the first time since 2022 (refer to the Cass Transportation Index Report), set up for a positive revenue and profitability environment for Cass in coming quarters.”
Fourth Quarter 2024 Highlights

Transportation Dollar Volumes – Transportation dollar volumes were $9.0 billion during the fourth quarter of 2024, a decrease of 0.6% as compared to the fourth quarter of 2023 and a decrease of 1.1% as compared to the third quarter of 2024. The decrease in dollar volumes was due to a decrease in the average dollars per transaction to $1,008 during the fourth quarter of 2024 as compared to $1,036 in the fourth quarter of 2023 and $993 in the third quarter of 2024.


Transportation dollar volumes are key to the Company’s revenue as higher volumes generally lead to an increase in payment float, which generates interest income, as well as an increase in payments in advance of funding, which generates financial fees.

Facility Expense Dollar Volumes – Facility expense dollar volumes totaled $5.3 billion during the fourth quarter of 2024, an increase of 9.1% as compared to the fourth quarter of 2023 and a decrease of 8.4% as compared to the third quarter of 2024. The increase as compared to the fourth quarter of 2023 is largely reflective of new client volume. The decrease as compared to the third quarter of 2024 is largely due to seasonality in client energy usage.

Processing Fees – Processing fees decreased $466,000, or 2.2%, over the same period in the prior year. The decrease in processing fees was largely driven by an decrease in fees in the Company’s Waste division and a decrease in ancillary fees, partially offset by increases in facility and transportation transaction volumes of 20.3% and 2.1%, respectively.

Financial Fees – Financial fees, earned on a transactional level basis for invoice payment services when making customer payments, decreased $753,000, or 6.6%. The decrease in financial fee income was primarily due to the decline in transportation dollar volumes of 0.6% in addition to changes in the manner certain vendors receive payments. The Company has had recent success signing clients for the Amplify by Cass working capital solution which is expected to begin to have a positive impact on financial fees during the second half of 2025.

Net Interest Income – Net interest income increased $730,000, or 4.3%. The increase in net interest income was attributable to an increase in the net interest margin to 3.55% in the fourth quarter of 2024 from 3.30% in the fourth quarter of 2023, partially offset by a decline in average interest-earning assets of $52.8 million, or 2.5%. The expansion in the net interest margin is largely due to an increase in the weighted-average yield on loans to 5.38% from 4.95% in the same quarter last year due to loan growth and fixed rate loans maturing and being re-priced in a higher interest rate environment.

Provision for Credit Losses - The Company recorded a provision for credit losses of $93,000 during the fourth quarter of 2024 as compared to a release of credit losses of $215,000 in the fourth quarter of 2023. The provision for credit losses for the fourth quarter of 2024 was largely driven by an increase in total loans of $3.6 million, or 0.3%, as compared to September 30, 2024 as well as an increase in unfunded commitments on new faith-based construction loans.

Personnel Expenses - Personnel expenses increased $3.5 million, or 11.7%. Salaries and commissions increased $410,000, or 1.7%, as compared to the fourth quarter of 2023 primarily as a result of merit increases. The Company has reduced its FTE count to 1,147 at December 31, 2024 as compared to 1,170 at September 30, 2024 and 1,202 at June 30, 2024. The December 31, 2024 FTE count includes 14 from AcuAudit. Salaries and commissions increased $421,000 as compared to the third quarter of 2024 due to an increase in employee profit sharing of $1.0 million, partially offset by the decline in FTEs.

Net periodic pension cost increased $3.5 million. The Company recorded a one-time non-cash expense of $3.5 million in the fourth quarter of 2024 related to the termination of its noncontributory defined-benefit pension plan. The termination of the plan is expected to reduce run rate operating expense by approximately $1.0 million on an annual basis. Excluding the impact of the one-time pension termination expense, personnel expenses were flat with the same quarter in the prior year.

Non-Personnel Expenses - Non-personnel expenses increased $765,000, or 7.1%. Equipment expense increased $378,000 due to an increase in depreciation expense on software related to recently completed technology initiatives.

Loans - When compared to December 31, 2023, ending loans increased $67.7 million, or 6.7%.

Payments in Advance of Funding – Average payments in advance of funding decreased $8.4 million, or 4.0%, primarily due to a 0.6% decrease in transportation dollar volumes, which led to fewer dollars advanced to freight carriers, as well as the continued consolidation of freight carriers.

Goodwill and Other Intangible Assets - When compared to September 30, 2024, goodwill and other intangible assets increased $6.3 million. In December 2024, the Company acquired AcuAudit, a premier freight audit platform for ocean and international air freight, from Acuitive Solutions LLC. The Asset Purchase Agreement reflects a base purchase price of $3.0 million and an earnout based on annualized recurring revenue at the end of 24 months. Current annualized recurring revenue is approximately $2.5 million. The Company expects the impact of the acquisition to be EBITDA neutral in 2025 and a minimal negative impact to diluted earnings per share driven by intangible amortization.

Deposits – Average deposits decreased $19.0 million, or 1.8%, when compared to the fourth quarter of 2023. The Company has experienced a migration of client funds from non-interest bearing to interest-bearing driven by the higher interest rate environment prior to the recent 100 basis point cumulative decline in the Federal Funds rate from September 2024 to December 2024.



Accounts and Drafts Payable - Average accounts and drafts payable decreased $54.5 million, or 4.9%. The decrease in these balances, which are non-interest bearing, are primarily reflective of a cyber event at a CassPay client during the first quarter of 2024, which decreased average balances by approximately $100.0 million, and a decrease in transportation dollar volumes of 0.6%, partially offset by an increase in facility dollar volumes of 9.1%. Accounts and drafts payable are a significant source of funding generated by payment float from transportation and facility clients.

Shareholders’ Equity - Total shareholders’ equity has decreased $779,000 since December 31, 2023 primarily as a result of dividends of $16.5 million and the repurchase of Company stock of $7.2 million, partially offset by net income of $19.2 million.
About Cass Information Systems
Cass Information Systems, Inc. is a leading provider of integrated information and payment management solutions. Cass enables enterprises to achieve visibility, control and efficiency in their supply chains, communications networks, facilities and other operations. Disbursing over $90 billion annually on behalf of clients, and with total assets of $2.4 billion, Cass is uniquely supported by Cass Commercial Bank. Founded in 1906 and a wholly owned subsidiary, Cass Commercial Bank provides sophisticated financial exchange services to the parent organization and its clients. Cass is part of the Russell 2000®. More information is available at www.cassinfo.com.
Forward Looking Information

This information contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include future financial and operating results, expectations, intentions, and other statements that are not historical facts. Such statements are based on current beliefs and expectations of the Company’s management and are subject to significant risks and uncertainties. These risks and uncertainties include the impact of economic and market conditions, inflationary pressures, risks of credit deterioration, interest rate changes, governmental actions, market volatility, security breaches and technology interruptions, energy prices and competitive factors, among others, as set forth in the Company’s most recent Annual Report on Form 10-K and subsequent reports filed with the Securities and Exchange Commission. Actual results may differ materially from those set forth in the forward-looking statements.

Note to Investors

The Company has used, and intends to continue using, the Investors portion of its website to disclose material non-public information and to comply with its disclosure obligations under Regulation FD. Accordingly, investors are encouraged to monitor Cass’s website in addition to following press releases, SEC filings, and public conference calls and webcasts.



Consolidated Statements of Income (unaudited)

($ and numbers in thousands, except per share data)
 Quarter
Ended
December 31, 2024		Quarter
Ended
September 30, 2024		Quarter
Ended
December 31, 2023		Year Ended December 31, 2024Year Ended December 31, 2023
Processing fees$20,262$20,053$20,728$82,671$79,566
Financial fees10,71411,17711,46743,29745,985
Total fee revenue$30,976$31,230$32,195$125,968$125,551
Interest and fees on loans14,42814,56712,79655,36250,825
Interest and dividends on securities4,1044,0074,35216,93118,215
Interest on federal funds sold and
       other short-term investments		3,8444,2004,57315,75213,720
Total interest income$22,376$22,774$21,721$88,045$82,760
Interest expense4,6125,1564,68720,25816,266
Net interest income$17,764$17,618$17,034$67,787$66,494
(Provision for) release of credit
       losses		(93)140215(447)550
Loss on sale of investment
       securities		(33)—(13)(46)(173)
Other1,7571,5621,3055,9275,089
Total revenues$50,371$50,550$50,736$199,189$197,511
Salaries and commissions24,27123,85023,86196,35693,474
Share-based compensation5708983423,1684,139
Net periodic pension cost3,5881954764,172878
Other benefits4,6324,9244,92119,69520,203
       Total personnel expenses$33,061$29,867$29,600$123,391$118,694
Occupancy8688908903,4463,560
Equipment2,3282,1071,9508,3057,138
Bad debt expense—6,559—7,847—
Other8,3507,4757,94131,98130,763
Total operating expenses$44,607$46,898$40,381$174,970$160,155
Income from operations before
       income taxes		$5,764$3,652$10,355$24,219$37,356
Income tax expense1,1707141,9455,0517,297
Net income$4,594$2,938$8,410$19,168$30,059
Basic earnings per share$.34$.22$.62$1.42$2.22
Diluted earnings per share$.33$.21$.61$1.39$2.18
Share data:
   Weighted-average common
        shares outstanding		13,436 13,504 13,467 13,502 13,530 
   Weighted-average common
        shares outstanding assuming
        dilution		13,718 13,786 13,755 13,778 13,816 




Consolidated Balance Sheets

($ in thousands)
 (unaudited ) December 31, 2024(unaudited ) September 30, 2024December 31, 2023
Assets:
   Cash and cash equivalents$349,728$230,556$372,468
   Securities available-for-sale, at fair value528,021550,756627,117
   Loans1,081,9891,078,3871,014,318
   Less: Allowance for credit losses(13,395)(13,447)(13,089)
Loans, net$1,068,594$1,064,940$1,001,229
   Payments in advance of funding208,530207,202198,861
   Premises and equipment, net34,17434,29530,093
   Investments in bank-owned life insurance50,32549,88549,159
   Goodwill and other intangible assets26,35920,09820,654
   Accounts and drafts receivable from customers66,28130,892110,651
   Other assets63,06972,13668,390
Total assets$2,395,081$2,260,760$2,478,622
Liabilities and shareholders’ equity:
   Deposits
      Non-interest bearing$251,230$392,573$524,359
      Interest-bearing716,686654,750616,455
Total deposits$967,916$1,047,323$1,140,814
   Accounts and drafts payable1,149,276936,4631,071,369
   Other liabilities48,85939,32736,630
Total liabilities$2,166,051$2,023,113$2,248,813
Shareholders’ equity:
   Common stock$7,753$7,753$7,753
   Additional paid-in capital205,593205,026208,007
   Retained earnings148,487148,092145,782
   Common shares in treasury, at cost(87,615)(84,139)(84,264)
   Accumulated other comprehensive loss (45,188)(39,085)(47,469)
Total shareholders’ equity$229,030$237,647$229,809
Total liabilities and shareholders’ equity$2,395,081$2,260,760$2,478,622




Average Balances (unaudited)

($ in thousands)
Quarter
Ended
December 31, 2024		Quarter
Ended
September 30, 2024		Quarter
Ended
December 31, 2023		Year Ended December 31, 2024Year Ended December 31, 2023
Average interest-earning assets$2,022,794$2,001,740$2,075,641$2,011,554$2,076,950
Average loans1,065,9441,072,8241,025,2591,048,7321,055,668
Average securities available-for-sale555,674535,423615,666578,817665,146
Average short-term investments348,632338,464356,887326,233287,243
Average payments in advance of funding200,963202,976209,364202,860234,865
Average assets2,366,9922,340,8702,414,6652,349,3972,419,608
Average non-interest bearing deposits399,778404,364464,924414,711512,608
Average interest-bearing deposits638,180630,204592,055634,581571,067
Average interest-bearing liabilities638,191630,215592,066634,592573,308
Average accounts and drafts payable1,055,9281,033,0701,110,4151,030,5201,081,245
Average shareholders’ equity$231,993$231,785$207,834$228,944$211,069


Consolidated Financial Highlights (unaudited)

($ and numbers in thousands, except ratios)
Quarter
Ended
December 31, 2024		Quarter
Ended
September 30, 2024		Quarter
Ended
December 31, 2023		Year Ended December 31, 2024Year Ended December 31, 2023
Return on average equity7.88%5.04%16.06%8.37%14.24%
Return on average assets0.77%0.50%1.38%0.82%1.24%
Net interest margin (1)
3.55%3.55%3.30%3.42%3.25%
Average interest-earning assets yield (1)
4.46%4.57%4.20%4.43%4.04%
Average loan yield5.38%5.40%4.95%5.28%4.81%
Average investment securities yield (1)
2.87%2.86%2.63%2.82%2.63%
Average short-term investment yield4.39%4.94%5.08%4.83%4.78%
Average cost of total deposits1.77%1.98%1.76%1.93%1.50%
Average cost of interest-bearing deposits2.88%3.25%3.14%3.19%2.85%
Average cost of interest-bearing liabilities2.87%3.25%3.14%3.19%2.84%
Allowance for credit losses to loans1.24%1.25%1.29%1.24%1.29%
Non-performing loans to total loans—%—%—%—%—%
Net loan charge-offs (recoveries) to loans—%—%—%—%—%
Common equity tier 1 ratio13.84%14.54%14.73%13.84%14.73%
Total risk-based capital ratio14.61%15.31%15.49%14.61%15.49%
Leverage ratio10.57%11.05%10.71%10.57%10.71%
Transportation invoice volume8,9199,1608,73335,72935,949
Transportation dollar volume$8,994,440$9,097,739$9,044,772$36,113,169$38,288,478
Facility expense transaction volume4,2184,3163,50517,13513,857
Facility expense dollar volume$5,291,143$5,778,291$4,848,064$21,438,282$19,836,821
(1) Yields are presented on tax-equivalent basis assuming a tax rate of 21%.

The Power to Deliver Solutions Around the world, leading enterprises rely on Cass for our vertical expertise, processing power, and global payment network to execute critical financial transactions while driving greater control and efficiency across critical business expenses. Q4 2024 INVESTOR PRESENTATION

 
Forward-Looking Statements Cass at a Glance Financial Performance Revenue & Expenses Balance Sheet Capital Leadership and Shareholder Information TABLE OF CONTENTS 2 3 4 6 9 14 19 20 www.cassinfo.com / © 2024 Cass Information Systems

 
This presentation contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements contain words such as “anticipate,” “believe,” “can,” “would,” “should,” “could,” “may,” “predict,” “seek,” “potential,” “will,” “estimate,” “target,” “plan,” “project,” “continuing,” “ongoing,” “expect,” “intend” or similar expressions that relate to the Company’s strategy, plans or intentions. Forward-looking statements involve certain important risks, uncertainties, and other factors, any of which could cause actual results to differ materially from those in such statements. Such factors include, without limitation, the “Risk Factors” referenced in our most recent Form 10-K filed with the Securities and Exchange Commission (SEC), other risks and uncertainties listed from time to time in our reports and documents filed with the SEC, and the following factors: ability to execute our business strategy; business and economic conditions; effects of a prolonged government shutdown; economic, market, operational, liquidity, credit and interest rate risks associated with the Company’s business; effects of any changes in trade, monetary and fiscal policies and laws; changes imposed by regulatory agencies to increase capital standards; effects of inflation, as well as, interest rate, securities market and monetary supply fluctuations; changes in the economy or supply-demand imbalances affecting local real estate values; changes in consumer and business spending; the Company's ability to realize anticipated benefits from enhancements or updates to its core operating systems from time to time without significant change in client service or risk to the Company's control environment; the Company's dependence on information technology and telecommunications systems of third-party service providers and the risk of systems failures, interruptions or breaches of security; the Company’s ability to achieve organic fee income, loan and deposit growth and the composition of such growth; changes in sources and uses of funds; increased competition in the payments and banking industries; the effect of changes in accounting policies and practices; the share price of the Company’s stock; the Company's ability to realize deferred tax assets or the need for a valuation allowance; ability to maintain or increase market share and control expenses; costs and effects of changes in laws and regulations and of other legal and regulatory developments; technological changes; the timely development and acceptance of new products and services; the Company’s continued ability to attract, hire and maintain qualified personnel; ability to implement and/or improve operational management and other internal risk controls and processes and reporting system and procedures; regulatory limitations on dividends from the Company's bank subsidiary; changes in estimates of future loan reserve requirements based upon the periodic review thereof under relevant regulatory and accounting requirements; widespread natural and other disasters, pandemics, dislocations, political instability, acts of war or terrorist activities, cyberattacks or international hostilities; impact of reputational risk; and success at managing the risks involved in the foregoing items. The Company can give no assurance that any goal or plan or expectation set forth in forward-looking statements can be achieved, and readers are cautioned not to place undue reliance on such statements. The forward-looking statements are made as of the date of original publication of this presentation, and the Company does not intend, and assumes no obligation, to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events or circumstances, except as required by applicable law. This presentation is a high-level summary of our recent and historical financial results and current business developments. For more detailed information, please refer to our press releases and filings with the SEC. FORWARD LOOKING STATEMENTS 3www.cassinfo.com / © 2024 Cass Information Systems

 
4www.cassinfo.com / © 2024 Cass Information Systems CASS AT A GLANCE

 
+ Cass is an information services company that processes freight and facility payments for a number of the largest global companies + The information systems business has a 70-year legacy + As a result of its $90B of payments, Cass generates $1B+ of average non-interest bearing float + Cass continues to operate a strong and profitable commercial bank founded in 1906 Note: Balance sheet metrics as of December 31, 2024. Income statement metrics are through period ended December 31, 2024 as indicated. Market. Cap. $550M Assets $2.4B YTD ROE 8.37% TTM NI $19.2M YTD % Fees/ Rev. 63.2% % AVG NIB Funding 69.5% INFORMATION SYSTEMS / PAYMENTS + Transportation information systems provides freight invoice audit and payment services + Facilities expense management provides invoice management, payment and business intelligence for all types of utility and facility related expenses + CassPay provides complex treasury management and payment services for fintech and other payment companies COMMERCIAL BANK + Cass Commercial Bank operates in three primary niches ‒ St. Louis C&I market ‒ Faith based organizations across the U.S. ‒ McDonalds’ franchisees + Strong track record of asset quality $90B Annual payments volume 50M Annual invoice volume $126M TTM fee revenue $1.0B YTD average float $1.1B Loans $1.0B Deposits 1.93% YTD cost of deposits $0 Charge-offs OVERVIEW 5www.cassinfo.com / © 2024 Cass Information Systems

 
6www.cassinfo.com / © 2024 Cass Information Systems FINANCIAL PERFORMANCE

 
Q4 2024 FINANCIAL HIGHLIGHTS 7www.cassinfo.com / © 2024 Cass Information Systems $8.41M $4.59M Q4 '23 Q4 '24 $0.61 $0.33 Q4 '23 Q4 '24 16.06% 7.88% Q4 '23 Q4 '24 NET INCOME DILUTED EPS RETURN ON EQUITY + Net income of $4.6 million + Successfully terminated defined benefit pension plan resulting in one-time expense of $3.5 million + Increase in net interest margin to 3.55% from 3.30% + Increase in facility expense transaction volumes of 20.3% + Completed acquisition of AcuAudit from Acuitive Solutions LLC + Repurchased 79,713 shares of Company stock $20.7M $20.3M Q4 '23 Q4 '24 FACILITY TRANSACTION VOLUME PROCESSING FEES 3.30% 3.55% Q4 '23 Q4 '24 NET INTEREST MARGIN 3.51M 4.22M Q4 '23 Q4 '24

 
QUARTERLY FINANCIAL PERFORMANCE 8www.cassinfo.com / © 2024 Cass Information Systems $40.4M $40.7M $42.8M $46.9M $44.6M Q4 '23 Q1 '24 Q2 '24 Q3 '24 Q4 '24 $8.41M $7.15M $4.48M $2.94M $4.59M Q4 '23 Q1 '24 Q2 '24 Q3 '24 Q34'24 16.05% 12.66% 8.01% 5.04% 7.88% Q4 '23 Q1 '24 Q2 '24 Q3 '24 Q4 '24 1.38% 1.20% 0.78% 0.50% 0.77% Q4 '23 Q1 '24 Q2 '24 Q3 '24 Q4 '24 TOTAL OPERATING EXPENSE NET INCOME RETURN ON EQUITY ROAA $50.7M $49.7M $48.6M $50.6M $50.4M Q4 '23 Q1 '24 Q2 '24 Q3 '24 Q4 '24 TOTAL REVENUE $0.61 $0.52 $0.32 $0.21 $0.33 Q4 '23 Q1 '24 Q2 '24 Q3 '24 Q4 '24 DILUTED EPS

 
9www.cassinfo.com / © 2024 Cass Information Systems REVENUE & EXPENSES

 
FINANCIAL FEES 10www.cassinfo.com / © 2024 Cass Information Systems + Financial fees declined $753,000 from Q4 2023 due to a 0.6% decline in transportation dollar volumes, which led to a lower average balance of payments in advance of funding, in addition to changes in the manner certain vendors receive payments. + The Company expects its new working capital solution and other initiatives to increase financial fees in future quarters. $9.0B $8.9B $9.1B $9.1B $9.0B Q4 '23 Q1 '24 Q2 '24 Q3 '24 Q4 '24 $4.85B $5.33B $5.04B $5.78B $5.29B Q4 '23 Q1 '24 Q2 '24 Q3 '24 Q4 '24 $209.4M $194.3M $213.2M $203.0M $201.0M Q4 '23 Q1 '24 Q2 '24 Q3 '24 Q4 '24 TRANSPORTATION DOLLAR VOLUMES FACILITY DOLLAR VOLUMES AVERAGE PAYMENTS IN ADVANCE OF FUNDING $11.5M $10.8M $10.6M $11.2M $10.7M Q4 '23 Q1 '24 Q2 '24 Q3 '24 Q4 '24 FINANCIAL FEES

 
PROCESSING FEES 11www.cassinfo.com / © 2024 Cass Information Systems + The change quarter to quarter is generally correlated to transportation and facility invoice volumes. + Processing fees decreased 2.2% as compared to 4Q 2023 primarily due to a decrease in fees in the Company’s Waste division and a decrease in ancillary fees, partially offset by increases in facility and transportation transaction volumes of 20.3% and 2.1%, respectively. 8.73M 8.77M 8.88M 9.16M 8.92M Q4 '23 Q1 '24 Q2 '24 Q3 '24 Q4 '24 3.51M 4.26M 4.34M 4.32M 4.22M Q4 '23 Q1 '24 Q2 '24 Q3 '24 Q4 '24 $20.7M $21.3M $21.1M $20.1M $20.3M Q4 '23 Q1 '24 Q2 '24 Q3 '24 Q4 '24 TRANSPORTATION INVOICE VOLUMES FACILITY INVOICE VOLUMES PROCESSING FEES

 
NET INTEREST INCOME 12www.cassinfo.com / © 2024 Cass Information Systems + The net interest margin (NIM) improved 25 basis points from Q4 2023 largely driven by an increase in the weighted average yield on loans to 5.38% from 4.95%. The increase in NIM led to a 4.3% increase in net interest income. + Higher 3-10 year U.S. Treasury rates would be expected to benefit the Company over the longer-term as fixed rate loans and investments mature and re-price to current market interest rates. $17.0M $16.5M $15.9M $17.6M $17.8M Q4 '23 Q1 '24 Q2 '24 Q3 '24 Q4 '24 $2.08B $2.06B $1.96B $2.00B $2.02B Q4 '23 Q1 '24 Q2 '24 Q3 '24 Q4 '24 3.30% 3.26% 3.32% 3.55% 3.55% Q4 '23 Q1 '24 Q2 '24 Q3 '24 Q4 '24 NET INTEREST INCOME AVERAGE INTEREST-EARNING ASSETS NET INTEREST MARGIN

 
NET INTEREST INCOME (CONTINUED) 13www.cassinfo.com / © 2024 Cass Information Systems + As can be seen in the graph below, the Company’s net interest margin has historically trended above the average 5-year UST. With the rise in short and long-term bond yields over the last 3 years, the yield on many of the Company’s fixed rate loans and investment securities is below current market interest rates. If mid and longer-term bond yields remain at or close to current levels, as the Company’s interest-earning assets mature and re-price to current market rates over the coming quarters and years, the Company’s NIM should benefit, thereby increasing net interest income. 0.00% 1.00% 2.00% 3.00% 4.00% 5.00% 6.00% 7.00% 8.00% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 CASS NIM Compared to Average 5-Year UST CASS NIM Avg 5-year UST

 
PERSONNEL EXPENSE 14www.cassinfo.com / © 2024 Cass Information Systems + Salaries and commissions have declined in recent quarters as a result of a reduction in the full-time employee count. + Employee profit sharing is tied to the overall level of net income. + The termination of the defined benefit pension plan resulted in a one-time non-cash expense of $3.5 million during Q4 2024 and is expected to decrease run-rate operating expense by approximately $1.0 million on an annual basis. + FTEs have declined 4.6% from June 30, 2024 to December 31, 2024. + The December 31, 2024 FTE count includes 14 from AcuAudit. Expense 4Q2023 1Q2024 2Q2024 3Q2024 4Q2024 Salaries and commissions $22.0 $22.4 $23.2 $23.2 $22.6 Employee profit sharing 1.9 1.6 1.0 0.7 1.6 Share-based compensation 0.3 1.2 0.5 0.9 0.6 Net periodic pension cost 0.5 0.2 0.2 0.2 3.6 Other benefits 4.9 5.2 5.0 4.9 4.6 Total personnel expense $29.6 $30.6 $29.9 $29.9 $33.1 Full-time equivalent employees (FTEs) 1,189 1,202 1,203 1,171 1,147 ($$ in millions)

 
NON-PERSONNEL EXPENSE 15www.cassinfo.com / © 2024 Cass Information Systems + Equipment expense has increased as a result of an increase in depreciation expense related to technology projects now in production. + Bad debt expense relates to a full write-off of a funding receivable related to a facility client. The Company is in the process of litigation to collect the receivable. + Other expense during Q2 2024 included $1.3 million of estimated late fees to be incurred on facility transactions as described in the Q2 2024 earnings release. Expense 4Q2023 1Q2024 2Q2024 3Q2024 4Q2024 Occupancy expense $0.9 $0.9 $0.8 $0.9 $0.9 Equipment expense 2.0 1.9 2.0 2.1 2.3 Bad debt expense 0.0 0.0 1.3 6.6 0.0 Other expense 7.9 7.3 8.9 7.4 8.4 Total non-personnel expense $10.8 $10.1 $13.0 $17.0 $11.6 ($$ in millions)

 
16www.cassinfo.com / © 2024 Cass Information Systems BALANCE SHEET

 
LOANS 17www.cassinfo.com / © 2024 Cass Information Systems + Loans increased 6.7% as compared to December 31, 2023. The Company experienced solid growth in franchise and C&I loans during 2024. + The Company has not incurred a loan charge-off since 2015. Portfolio Composition 12/31/23 3/31/24 6/30/24 9/30/24 12/31/24 Franchise $214.7 $213.9 $229.6 $237.1 $257.8 Faith-Based 389.2 387.5 382.2 401.3 394.5 Leases 121.3 126.1 131.4 118.3 122.1 Other C&I 162.6 186.4 187.6 193.1 179.3 Other CRE 126.6 123.0 131.2 128.6 128.3 Ending Loans $1,014.3 $1,037.0 $1,062.0 $1,078.4 $1,082.0 Loan Yield 4.95% 5.06% 5.26% 5.40% 5.38% ACL/Loans 1.29% 1.28% 1.28% 1.27% 1.24% Net Charge-Offs — — — — — Non-Performing Loans/Loans — — — — — Franchise 24% Faith-Based 37% Leases 11% Commercial and Industrial 18% Commercial Real Estate 12% PORTFOLIO COMPOSITION 12/31/24 ($$ in millions)

 
INVESTMENT PORTFOLIO COMPOSITION 18www.cassinfo.com / © 2024 Cass Information Systems + All investment securities are classified as available-for-sale. The overall weighted-average repricing term is 4.0 years and the average yield for 4Q2024 was 2.87%. The portfolio had unrealized losses of $59.7 million at December 31, 2024 resulting in a total fair value for the portfolio of $528.0 million. + The asset-backed securities are backed by student loans in the FFELP program with a minimum 97% guaranty by the U.S. Department of Education. Theses securities have long maturities but are floating rate assets. + Of the total $95.8 million portfolio of high-quality corporate bonds, $28.0 million are floating rate. + The mortgage-backed securities portfolio has an estimated average life of 4.9 years. + 99% of the municipal securities are an investment grade of “A” or higher. PORTFOLIO COMPOSITION (BOOK VALUE) State and Political $188.9M MBS $267.4M Corporate Bonds $95.8M Asset-Backed $35.6M

 
FUNDING 19www.cassinfo.com / © 2024 Cass Information Systems + For 4Q2024, 69.5% of average funding was non-interest bearing, a strategic advantage in the current interest rate environment. + Average accounts and drafts payable declined during 4Q2024 as a result of a cyber event at a CassPay client during Q1 2024, resulting in the loss of approximately $100.0 million of balances, in addition to a decrease in transportation dollar volumes of 0.6%, partially offset by an increase in facility dollar volumes of 9.1%. AVERAGE DEPOSITS AND ACCOUNTS & DRAFTS PAYABLE FUNDING COMPOSITION $1.4B IN NON- INTEREST FUNDING $1.11B $1.04B $1.00B $1.03B $1.06B $1.06B $1.08B $1.05B $1.03B $1.04B Q4 '23 Q1 '24 Q2 '24 Q3 '24 Q4 '24 AVERAGE DEPOSITS AVERAGE ACCOUNTS & DRAFTS PAYABLE $2.17B $2.12B $2.05B $2.1B $2.06B Int-DDA, MM, Savings $635.2M Non-Interest $251.2M Accts & Drafts Payable $1,149.3M Time Deposits $81.5M

 
KEY FUNDING POINTS 20www.cassinfo.com / © 2024 Cass Information Systems + Accounts and drafts payable represents float generated by our payments businesses and have proven a very stable source of funding over a long period of time. + Deposits are generated from core Bank and CassPay clients. These deposits almost entirely consist of operating accounts from core faith-based and other C&I clients as well as CassPay clients where the Company generates float. + The cost of deposits for the fourth quarter of 2024 was 1.77%. + The Bank participates in the CDARS and ICS programs offered by Promontory Interfinancial Network, LLC, enabling FDIC insurance up to $100 million on money market accounts and $50 million on certificates of deposit. + There are no brokered deposits or wholesale borrowings. + The Bank has a $184 million secured line of credit with the FHLB collateralized by commercial mortgage loans. + The Company has $250.0 million of unused lines of credit collateralized by investment securities.

 
CAPITAL 21www.cassinfo.com / © 2024 Cass Information Systems + The Company maintains excess capital to support organic balance sheet growth and opportunistic acquisitions + Dividend of $0.31 per share + Cass has continuously paid regularly scheduled cash dividends since 1934 + The Company repurchased 79,713 shares of Company stock during Q4 2024 at a weighted average price of $44.02 Tier 1 leverage ratio at 12/31/24 10.57% Common equity tier 1 risk- based ratio at 12/31/24 13.84% Tier 1 risk-based ratio at 12/31/24 13.84% Total risk-based ratio at 12/31/24 14.61%

 
LEADERSHIP AND SHAREHOLDER INFORMATION 22www.cassinfo.com / © 2024 Cass Information Systems

 
BOARD OF DIRECTORS 23 Eric H. Brunngraber Executive Chairman Ralph W. Clermont Retired Managing Partner, KPMG LLP, Saint Louis, Missouri Robert A. Ebel Retired Chief Executive Officer, Universal Printing Company Wendy J. Henry Retired Managing Partner, BKD, LLP James J. Lindemann Retired Executive Vice President, Emerson Sally H. Roth Retired Area President — Upper Midwest, Regions Bank Joseph D. Rupp Lead Director and Retired Chairman, President, and Chief Executive Officer, Olin Corporation Randall L. Schilling Chief Executive Officer, OPO Startups, LLC Franklin D. Wicks, Jr., Ph.D. Retired Executive Vice President and President, Applied Markets, Sigma-Aldrich Benjamin F. (Tad) Edwards, IV Chairman, Chief Executive Officer, and President, Benjamin F. Edwards & Company www.cassinfo.com / © 2024 Cass Information Systems Ann W. Marr Retired Executive Vice President of Global Human Resources, World Wide Technology Martin H. Resch President and Chief Executive Officer

 
LEADERSHIP COUNCIL 24 Cory J. Bricker Senior Vice President and President - CassPay Carl N. Friedholm Senior Vice President and President - Telecom Expense Management Christi A. Reiter Senior Vice President - Human Resources Nicole M. Jennings Vice President - Internal Audit and Risk Management Martin H. Resch President and Chief Executive Officer Mark A. Campbell Senior Vice President and President – Government Payables Jeanne M. Scannell Chief Credit Officer - Cass Commercial Bank James M. Cavellier Executive Vice President and Chief Information Officer Teresa D. Meares Senior Vice President and President - Waste Expense Management Matthew S. Schuckman Executive Vice President, General Counsel, and Corporate Secretary Dwight D. Erdbruegger President and Chief Operating Officer, Cass Commercial Bank Michael J. Normile Executive Vice President and Chief Financial Officer Anthony G. Urban Executive Vice President - Transportation Information Services www.cassinfo.com / © 2024 Cass Information Systems Ross M. Miller Senior Vice President and President - TouchPoint Sean M. Mullins Vice President – Chief Information Security Officer Todd J. Wills Senior Vice President and President - Utility Expense Management

 
SHAREHOLDER INFORMATION 25www.cassinfo.com / © 2024 Cass Information Systems CORPORATE HEADQUARTERS Cass Information Systems, Inc. 12444 Powerscourt Drive, Suite 550 Saint Louis, Missouri 63131 314.506.5500 www.cassinfo.com INVESTOR RELATIONS ir@cassinfo.com COMMON STOCK The company’s common stock trades on the NASDAQ stock market under the symbol CASS. INDEPENDENT AUDITORS KPMG LLP 10 South Broadway, Suite 900 Saint Louis, Missouri 63102 TRANSFER AGENT Shareholder correspondence should be mailed to: Computershare P.O. Box 43006 Providence, RI 02940-3006 Overnight correspondence should be mailed to: Computershare 150 Royall St, Suite 101 Canton, MA 02021 SHAREHOLDER WEBSITE www.computershare.com/investor SHAREHOLDER ONLINE INQUIRIES www-us.computershare.com /investor/Contact TOLL-FREE PHONE 866.323.8170

 
Thank You for Your Time

 
v3.24.4
Cover
Jan. 23, 2025
Cover [Abstract]  
Document Type 8-K
Document Period End Date Jan. 23, 2025
Entity Registrant Name CASS INFORMATION SYSTEMS, INC.
Entity Incorporation, State or Country Code MO
Entity File Number 000-20827
Entity Tax Identification Number 43-1265338
Entity Address, Address Line One 12444 Powerscourt Drive
Entity Address, Address Line Two Suite 550
Entity Address, City or Town St. Louis
Entity Address, State or Province MO
Entity Address, Postal Zip Code 63131
City Area Code 314
Local Phone Number 506-5500
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, par value $0.50 per share
Trading Symbol CASS
Security Exchange Name NASDAQ
Entity Emerging Growth Company false
Entity Central Index Key 0000708781
Amendment Flag false
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