Company: AX
Filing Date: 2025-10-30
Form Type: 10-Q
Source: 0001299709-25-000184
Chunk: 137

Company: Axos Financial, Inc.
Filing Date: 2025-10-30
Form: 10-Q
Item: Part I, Item 2
Chunk 137
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52024Efficiency ratio42.89 %39.83 %Return on average assets1.79 %2.17 %Interest rate spread3.96 %4.16 %Net interest margin4.80 %5.21 %

Our Banking Business Segment’s net interest margin exceeds our consolidated net interest margin. Our consolidated net interest margin includes certain items that are not reflected in the calculation of our net interest margin within our Banking Business Segment and reduce our consolidated net interest margin, such as the borrowing costs at our Company and the yields and costs associated with certain items within interest-earning assets and interest-bearing liabilities in our Securities Business Segment, including items related to securities financing operations.

Securities Business Segment

For the three months ended September 30, 2025, our Securities Business Segment had income before income taxes of $8.3 million, compared to income before income taxes of $9.1 million, for the three months ended September 30, 2024.

For the three months ended September 30, 2025, net interest income increased $0.9 million, or 12.8%, compared to net interest income for the three months ended September 30, 2024. The increase for the three months ended September 30, 2025 was primarily attributable to higher interest earned on securities borrowed, as well as deposits in other financial institutions.

For the three months ended September 30, 2025, non-interest income decreased $0.4 million, or 1.5%, compared to the three months ended September 30, 2024. The decrease was primarily driven by lower broker-dealer fee income as a result of lower rates earned on cash sorting balances, partially offset by higher average cash sorting balances. This decrease was partially offset by higher advisory fee income, primarily attributable to increased advisor statement fees and higher mutual fund balances.

For the three months ended September 30, 2025, non-interest expense increased $1.3 million or 4.5%, compared to the three months ended September 30, 2024. The increase reflects higher data and operational processing and professional services expenses.

The following table provides selected information for Axos Clearing:

(Dollars in thousands)September 30, 2025June 30, 2025FDIC insured deposit program balances at banks$1,534,502 $1,444,830 Margin balances$239,067 $229,387 Cash reserves for the benefit of customers