Company: AX
Filing Date: 2025-01-28
Form Type: 10-Q
Source: 0001299709-25-000011
Chunk: 95

Company: Axos Financial, Inc.
Filing Date: 2025-01-28
Form: 10-Q
Item: Part I, Item 1
Chunk 95
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 leverage ratio. At December 31, 2024 and June 30, 2024, our Company and Bank were in compliance with the capital conservation buffer requirement, which sets the common equity tier 1 risk-based, tier 1 risk-based and total risk-based capital ratio minimums to 7.0%, 8.5% and 10.5%, respectively.

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Securities Business

Pursuant to the net capital requirements of the Exchange Act, Axos Clearing is subject to the SEC Uniform Net Capital (Rule 15c3-1 of the Exchange Act). Under this rule, the Company has elected to operate under the alternate method and is required to maintain minimum net capital of $250,000 or 2% of aggregate debit balances arising from client transactions, as defined. Under the alternate method, the Company may not repay subordinated debt, pay cash distributions, or make any unsecured advances or loans to its parent or employees if such payment would result in net capital of less than 5% of aggregate debit balances or less than 120% of its minimum dollar requirement. As part of its capital management, Axos Clearing may make distributions to the Company from time to time.

The net capital position of Axos Clearing was as follows: 

(Dollars in thousands)December 31, 2024June 30, 2024Net capital$83,932 $101,462 Excess Capital$78,282 $96,654 Net capital as a percentage of aggregate debit items29.71 %42.21 %Net capital in excess of 5% aggregate debit items$69,805 $89,442 

Axos Clearing, as a clearing broker, is subject to the SEC Customer Protection Rule (Rule 15c3-3 of the Exchange Act) which requires segregation of funds in a special reserve account for the exclusive benefit of customers (“Customer Reserve Bank Account”) and proprietary accounts of brokers (“PAB Reserve Account”). As of December 31, 2024, Axos Clearing was in compliance with its Customer Reserve Bank Account and PAB Reserve Account deposit requirements.

ITEM 3.       QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

For further discussion of the Company’s market risk, see Item 7A—“Quantitative and Qualitative Disclosures About Market Risk” in the 2024 Form 10-K.

We measure interest rate sensitivity as the difference between