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- **Record Loan Growth**: $1.6 billion net loan growth, including $1 billion from Verdant, driving 15%+ annualized net interest income growth. 
- **Verdant Synergies**: Expected to add $150-200M quarterly and boost EPS by 2-3% in FY2026. 
- **Strong Credit Metrics**: Nonperforming loans at 74bp, down 5bp linked quarter; net charge-offs at 11bp. 
- **Deposit Expansion**: Total deposits up 11.5% year-over-year to $22.3B, with 94% in low-cost funding. 
- **AI-Driven Efficiency**: Investing in AI to reduce expenses below 30% of revenue growth, with Axos Workstation rolling out to RIAs. 
- **M&A Focus**: Actively pursuing accretive deals in specialty lending, with $1.3B pipeline in floor plan lending.

**【CEO Summary Section】**
- **Revenue Growth and Loan Expansion**: Achieved $1.6 billion net loan growth in Q1 2026, including $1 billion from the Verdant acquisition. Net interest income increased by $11 million linked quarter, driven by growth across single-family mortgage, commercial specialty real estate, and auto lending. 
- **Verdant Acquisition Impact**: Added $1.2 billion in loans and leases, with expectations for $150-200 million quarterly growth. The acquisition is projected to be accretive to EPS by 2-3% in FY2026 and 5-6% in FY2027. 
- **Credit Quality**: Nonperforming loans improved to 74 basis points of total loans, down 5 basis points linked quarter. Net charge-offs declined 5 basis points year-over-year to 11 basis points. 
- **Deposit Growth**: Total deposits reached $22.3 billion, up 6.9% year-over-year, with 94% in low-cost demand, money market, and savings accounts. 
- **AI and Operational Efficiency**: Investing in AI to enhance productivity across risk, compliance, and software development. The Axos Professional Workstation is being rolled out to RIAs and brokers to integrate banking products seamlessly. 

**【CFO Financial Commentary】**
- **Financial Performance**: Net income of $112.4 million, up 1.5% linked quarter. Diluted EPS was $1.94, with adjusted EPS of $2.06 excluding deal-related expenses. 
- **Expense Management**: Noninterest expenses increased by $5.6 million linked quarter, driven by salaries and benefits. Excluding one-time Verdant costs, expenses grew 2.8%. 
- **Tax Rate**: Effective tax rate of 25% for the quarter, benefiting from California tax changes. Forward guidance remains 26-27%. 
- **Loan Pipeline**: $2.2 billion pipeline as of October 24, including $1.1 billion in commercial verticals and $76 million in auto/consumer loans. 

**【Q&A Highlights】**
- **Credit Risk Management**: Emphasized fraud prevention in NDFI (Non-Depository Financial Institutions) lending, with stringent title insurance and lien monitoring. No material losses expected from current nonperforming assets. 
- **Verdant Funding**: $754 million in securitizations with 3.7-year weighted average life and spreads of 2.57-3.07%. Plans to replace with lower-cost deposits over time. 
- **M&A Strategy**: Actively pursuing accretive acquisitions in specialty lending and banking, with focus on cultural fit and financial discipline. 
- **Floor Plan Lending**: New team secured term sheets for several hundred million in lines, leveraging manufacturer repurchase agreements (MBRAs). 
- **Expense Growth Guidance**: Personnel and professional services expenses to grow below 30% of net interest and noninterest income growth, supported by AI-driven efficiency improvements.

Axos Financial, Inc. (AX) Q1 2026 Earnings Call Transcript

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