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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):  July 29, 2021

Axos Financial, Inc.

(Exact name of registrant as specified in its charter)

Delaware			001-37709			33-0867444
(State or other jurisdiction of incorporation)			(Commission File Number)			(IRS Employer Identification Number)

 9205 West Russell Road, STE 400, Las Vegas, NV                    89148

(Address of principal executive offices)                        (zip code)

Registrant’s telephone number, including area code: (858) 649-2218          

Securities registered pursuant to Section 12(b) of the Act:
Title of each class			Trading Symbol(s)			Name of each exchange on which registered
Common stock, $.01 par value			AX			New York Stock Exchange

Not Applicable

(Former name or former address, if changed since last report.)

 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 (see General Instruction A.2. below):

 

☐                                    Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

☐                                    Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

☐                                    Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

☐                                    Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

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.  ☐

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Item 2.02     Results of Operations and Financial Condition

On July 29, 2021, Axos Financial, Inc. (the “Registrant”) issued a press release announcing its fourth quarter results of operations for the period ended June 30, 2021. The press release is set forth as Exhibit 99.1 and is incorporated by reference in this Item 2.02.

Pursuant to General Instruction B.2. of Form 8-K, the information in this Item 2.02 of Form 8-K, including Exhibit 99.1, 99.2, 99.3 and 99.4 is being furnished pursuant to Item 2.02 and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise be subject to the liabilities of that section, nor is it incorporated by reference into any filing of the Registrant under the Securities Act of 1933 or the Securities Exchange Act of 1934, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

Item 9.01     Financial Statements and Exhibits.

(d)    Exhibits.

Exhibit						Description
99.1						Press Release of Axos Financial, Inc. dated July 29, 2021
99.2						Financial Schedules
99.3						Press Release Earnings Supplement
99.4						Press Release Earnings Supplement PDF

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SIGNATURE

 

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.

Axos Financial, Inc.

Date:

July 29, 2021

By:

/s/ Andrew J. Micheletti

Andrew J. Micheletti

EVP and Chief Financial Officer

Axos Financial, Inc. Announces Record Net Income of $215.7 million for Fiscal 2021

Earnings Per Share for the Fourth Quarter of Fiscal 2021 up 20.0% Year-over-Year

SAN DIEGO, CA – (BUSINESS WIRE) – July 29, 2021 – Axos Financial, Inc. (NYSE: AX) (“Axos”), parent company of Axos Bank (the “Bank”), today announced unaudited financial results for the fourth fiscal quarter and full fiscal year ended June 30, 2021. Net income for the quarter was $54.3 million, an increase of 19.8% over net income of $45.3 million for the quarter ended June 30, 2020. Earnings attributable to Axos’ common stockholders were $54.3 million or $0.90 per diluted share for the fourth quarter of fiscal 2021, an increase of 20.0% from $45.2 million or $0.75 per diluted share for the fourth quarter ended June 30, 2020.

Adjusted earnings and adjusted earnings per diluted common share (“Adjusted EPS”), non-GAAP measures, which exclude non-cash amortization expenses and other non-recurring costs increased 18.6% to $55.8 million and 17.9% to $0.92, respectively, for the quarter ended June 30, 2021 compared to $47.1 million and $0.78, respectively, for the quarter ended June 30, 2020.

Fourth Quarter Fiscal 2021 Financial Summary:

			Three Months Ended  June 30,
(Dollars in thousands, except per share data)			2021						2020						% Change
Net interest income			$	141,654					$	117,272					20.8		%
Non-interest income			$	16,801					$	28,702					(41.5)		%
Net income			$	54,255					$	45,300					19.8		%
Adjusted Earnings (Non-GAAP)1			$	55,811					$	47,052					18.6		%
Net income attributable to common stockholders			$	54,255					$	45,223					20.0		%
Diluted EPS			$	0.90					$	0.75					20.0		%
Adjusted EPS (Non-GAAP)1			$	0.92					$	0.78					17.9		%

1 See “Use of Non-GAAP Financial Measures”

For the fiscal year ended June 30, 2021, net income was a record $215.7 million, an increase of 17.6% over net income of $183.4 million for the twelve months ended June 30, 2020. Earnings attributable to Axos’ common stockholders were $215.5 million or $3.56 per diluted share for the twelve months ended June 30, 2021, an increase of 17.7% from $183.1 million or $2.98 per diluted share for the twelve months ended June 30, 2020. Record earnings for the fiscal year ended June 30, 2021 were primarily the result of growth in interest-earning assets and reduced cost of interest-earning liabilities. Operating expenses increased to support growth of the Bank due to higher levels of loan originations and deposit activities.

“We finished the year with strong net interest income growth of 4.4% over the linked quarter and 20.8% year-over-year as a result of solid growth in average assets and a stable net interest margin,” stated Greg Garrabrants, President and Chief Executive Officer of Axos. “Our Securities Business generated double-digit growth in margin balances and stock lending, resulting in a $0.5 million pretax income contribution this quarter. We see tremendous opportunities to deliver positive operating leverage in our securities clearing and custody businesses as we expand our product capabilities and scale.”

“We generated solid loan growth of 3.4% over the linked quarter and 20.3% year-over-year excluding single-family jumbo mortgages and single-family warehouse loans,” stated Andy Micheletti, Executive Vice President and Chief Financial Officer of Axos. “Our credit quality remains good, with 7 basis points of net annualized charge-offs to average loans excluding seasonal tax loan products in our fiscal 2021. We had another strong year in returns, with a ROE of 16.51% and a ROA of 1.52% for the twelve months ended June 30, 2021.”

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Other Highlights:

•Net interest margin was 3.92%, up 3 basis points from 3.89% for the three months ended June 30, 2020

•Average funding costs were 61 basis points for the three months ended June 30, 2021 compared to 1.25% for the three months ended June 30, 2020

•Pretax income for the Securities Business was $0.5 million compared to a pretax loss of $1.6 million in the three months ended June 30, 2020

•Average loan balances for the three months ended June 30, 2021 grew $914.4 million, or 8.6%, compared to the three months ended June 30, 2020

•Loan originations for investment for the three months ended June 30, 2021 increased by 38.4% to $1,824.5 million compared to $1,317.8 million for the quarter ended June 30, 2020

•Return on average common stockholders’ equity was 15.56% for the three months ended June 30, 2021

•Total net annualized charge-offs to average loans, excluding seasonal tax loan products, were 0.01% for the three months ended June 30, 2021

•Tangible book value increased to $21.36 per share, up 16.8% compared to June 30, 2020

Fourth Quarter Fiscal 2021 Income Statement Summary

During the quarter ended June 30, 2021, Axos earned $54.3 million or $0.90 per diluted share compared to $45.3 million, or $0.75 per diluted share for the quarter ended June 30, 2020. Net interest income increased $24.4 million or 20.8% for the quarter ended June 30, 2021 compared to June 30, 2020, primarily due to the lower cost of deposits and borrowing resulting from interest rate reductions and increases in non-interest-bearing demand deposits.

The provision for credit losses was $1.3 million for the quarter ended June 30, 2021 compared to $6.5 million for the quarter ended June 30, 2020. The decrease was primarily due to overall loan portfolio decline and changes in the loan mix.

For the fourth quarter ended June 30, 2021, non-interest income was $16.8 million compared to $28.7 million for the three months ended June 30, 2020. The decrease year over year was primarily the result of decreases in mortgage banking fee income of $9.8 million and a decrease in banking and service fees of $3.8 million, partially offset by an increase in prepayment penalty fee income of $1.7 million and an increase in broker-dealer fee income of $0.7 million.

Non-interest expense or operating costs increased $10.3 million to $81.9 million for the quarter ended June 30, 2021 from $71.5 million for the three months ended June 30, 2020. The increase was mainly a result of an increase in data processing of $4.1 million, due to software initiatives and enhancements to the Bank’s core processing system. Additional contributors to the increase in operating expenses were an increase in other general and administrative of $2.9 million, an increase in professional services of $1.7 million, an increase of $1.0 million in broker-dealer clearing charges, an increase in occupancy and equipment related expenses of $1.0 million, and an increase in advertising and promotional expenses of $0.8 million.

Our effective tax rate was 27.99% for the three months ended June 30, 2021 compared to 33.31% for the three months ended June 30, 2020. The decrease in the tax rate for the three months ended June 30, 2021, is primarily due to a tax benefit from stock compensation during the quarter ended June 30, 2021, compared to a write off of a deferred tax asset for stock compensation that wasn’t expected to be realized in the future, which resulted in $2.0 million of additional expense for the three months ended June 30, 2020.

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Full Year Fiscal 2021 Highlights

•Net income reached a record $215.7 million, an increase of 17.6% compared to the fiscal year ended June 30, 2020

•Earnings per diluted share outstanding were $3.56, up 19.5% from $2.98 in the fiscal year ended June 30, 2020

•Loan originations for investment for the fiscal year ended June 30, 2021 were $7,304.4 million, up 7.4% compared to the fiscal year ended June 30, 2020

•Net interest margin for the Banking Business decreased to 4.11% for the fiscal year ended June 30, 2021 compared to 4.19% for the fiscal year ended June 30, 2020

•Mortgage banking income increased by 104.2% to $42.2 million for the twelve months ended June 30, 2021

•Efficiency for the Banking Business was 41.95% for the fiscal year ended June 30, 2021 compared to 39.81% for the fiscal year ended June 30, 2020

•Return on average assets remained strong at 1.52% for the fiscal year ended June 30, 2021

Balance Sheet Summary

Axos’ total assets increased $413.7 million, or 3.0%, to $14,265.6 million, as of June 30, 2021, up from $13,851.9 million at June 30, 2020. The loan portfolio increased $783.5 million or 7.4%on a net basis. Total cash decreased by $912.7 million primarily due to decreased deposits. Total liabilities increased by $243.6 million, or 1.9%, to $12,864.6 million at June 30, 2021, up from $12,621.1 million at June 30, 2020. The increase in total liabilities resulted primarily from growth in securities loaned of $473.0 million, advances from the Federal Home Loan Bank of $111.0 million and customer and broker-dealer payables of $187.8 million, partially offset by decreased deposits of $520.9 million. Stockholders’ equity increased by $170.1 million, or 13.8%, to $1,400.9 million at June 30, 2021 from $1,230.8 million at June 30, 2020. The increase was primarily the result of $215.7 million in net income and $10.0 million of vesting and issuance of RSUs and stock-based compensation expense, partially offset by a $37.0 million adjustment to retained earnings for the adoption of ASC 326, $16.8 million of stock repurchases, $5.2 million for redemption of series-A preferred stock, $3.4 million of unrealized loss in other comprehensive income, net of tax, and $0.1 million of dividends declared on preferred stock.

The Bank’s Tier 1 core capital to adjusted average assets ratio was 9.45% at June 30, 2021.

Conference Call

A conference call and webcast will be held on Thursday, July 29, 2021 at 5:00 PM Eastern / 2:00 PM Pacific. Analysts and investors may dial in and participate in the question/answer session. To access the call, please dial: 877-407-8293. The conference call will be webcast live and may be accessed at Axos’ website, http://www.axosfinancial.com. For those unable to listen to the live broadcast, a replay will be available until, August 29, 2021, at Axos’ website and telephonically by dialing toll-free number 877-660-6853, passcode 13721053.

About Axos Financial, Inc. and subsidiaries

The condensed consolidated financial statements include the accounts of Axos Financial, Inc. (“Axos”) and its wholly owned subsidiaries, Axos Bank (the “Bank”) and Axos Nevada Holding, LLC (“Axos Nevada Holding” and collectively, the “Company”). Axos Nevada Holding wholly owns its subsidiary Axos Securities, LLC, which wholly owns subsidiaries Axos Clearing LLC, a clearing broker-dealer, Axos Invest, Inc., a registered investment advisor, and Axos Invest LLC, an introducing broker-dealer. With approximately $14.3 billion in assets, Axos Bank provides consumer and business banking products through its low-cost distribution channels and affinity partners. Axos Clearing LLC and Axos Invest, Inc. provide comprehensive securities clearing services to introducing broker-dealers and registered investment advisor correspondents, and digital investment advisory services to retail investors, respectively. Axos Financial, Inc.’s common stock is listed on the NYSE under the symbol “AX” and is a component of the Russell 2000® Index and the S&P SmallCap 600® Index. For more information on Axos Bank, please visit axosbank.com.

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SEGMENT REPORTING

The Company determines reportable segments based on the services offered, the significance of the services offered, the significance of those services to the Company’s financial condition and operating results and the CEO’s evaluation of the operating results of those services in deciding how to allocate resources and assess performance. The Company operates through two segments: Banking Business and Securities Business. In order to reconcile the two segments to the consolidated totals, the Company includes parent-only activities and intercompany eliminations.

The following tables present the operating results of the segments and reconciliations:

			For the Three Months Ended June 30, 2021
(Dollars in thousands)			Banking Business						Securities Business						Corporate/Eliminations						Axos Consolidated
Net interest income			$	137,493					$	5,744					$	(1,583)					$	141,654
Provision for loan losses			1,250						—						—						1,250
Non-interest income			10,442						6,902						(543)						16,801
Non-interest expense			66,863						12,149						2,848						81,860
Income (Loss) before income taxes			$	79,822					$	497					$	(4,974)					$	75,345

			For the Three Months Ended June 30, 2020
(Dollars in thousands)			Banking Business						Securities Business						Corporate/Eliminations						Axos Consolidated
Net interest income			$	114,264					$	3,493					$	(485)					$	117,272
Provision for loan losses			6,500						—						—						6,500
Non-interest income			23,100						5,730						(128)						28,702
Non-interest expense			56,348						10,869						4,327						71,544
Income (Loss) before income taxes			$	74,516					$	(1,646)					$	(4,940)					$	67,930

			Twelve Months Ended June 30, 2021
(Dollars in thousands)			Banking Business						Securities Business						Corporate/Eliminations						Axos Consolidated
Net interest income			$	527,760					$	18,746					$	(7,764)					$	538,742
Provision for loan losses			23,750						—						—						23,750
Non-interest income			79,150						27,627						(1,516)						105,261
Non-interest expense			254,596						48,095						11,819						314,510
Income (Loss) before income taxes			$	328,564					$	(1,722)					$	(21,099)					$	305,743

			Twelve Months Ended June 30, 2020
(Dollars in thousands)			Banking Business						Securities Business						Corporate/Eliminations						Axos Consolidated
Net interest income			$	464,448					$	16,630					$	(3,467)					$	477,611
Provision for loan losses			42,200						—						—						42,200
Non-interest income			80,374						24,817						(2,204)						102,987
Non-interest expense			216,895						43,525						15,346						275,766
Income (Loss) before income taxes			$	285,727					$	(2,078)					$	(21,017)					$	262,632

Use of Non-GAAP Financial Measures

In addition to the results presented in accordance with GAAP, this report includes non-GAAP financial measures such as adjusted earnings, adjusted earnings per diluted common share, and tangible book

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value per common share. Non-GAAP financial measures have inherent limitations, may not be comparable to similarly titled measures used by other companies and are not audited. Readers should be aware of these limitations and should be cautious as to their reliance on such measures. Although we believe the non-GAAP financial measures disclosed in this report enhance investors’ understanding of our business and performance, these non-GAAP measures should not be considered in isolation, or as a substitute for GAAP basis financial measures.

We define “adjusted earnings”, a non-GAAP financial measure, as net income without the after-tax impact of non-recurring acquisition-related costs and other costs (unusual or non-recurring charges), as adjusted earnings, a non-GAAP financial measure. Adjusted earnings per diluted common share (“adjusted EPS”), a non-GAAP financial measure, is calculated by dividing non-GAAP adjusted earnings by the average number of diluted common shares outstanding during the period. We believe the non-GAAP measures of adjusted earnings and adjusted EPS provide useful information about the Bank’s operating performance. We believe excluding the non-recurring acquisition related costs and other (unusual or non-recurring) costs provides investors with an alternative understanding of Axos’ core business.

Below is a reconciliation of net income, the nearest compatible GAAP measure, to adjusted earnings and adjusted EPS (Non-GAAP) for the periods shown:

			Three Months Ended												Twelve Months Ended
			June 30,												June 30,
(Dollars in thousands, except per share amounts)			2021						2020						2021						2020
Net income			$	54,255					$	45,300					$	215,707					$	183,438
Acquisition-related costs			2,161						2,627						9,826						10,108
Income taxes			(605)						(875)						(2,894)						(3,048)
Adjusted earnings (Non-GAAP)			$	55,811					$	47,052					$	222,639					$	190,498
Adjusted EPS (Non-GAAP)			$	0.92					$	0.78					$	3.68					$	3.10

We define “tangible book value”, a non-GAAP financial measure, as book value adjusted for goodwill and other intangible assets. Tangible book value is calculated using common stockholders’ equity minus mortgage servicing rights, goodwill and other intangible assets. Tangible book value per common share, a non-GAAP financial measure, is calculated by dividing tangible book value by the common shares outstanding at the end of the period. We believe tangible book value per common share is useful in evaluating the Company’s capital strength, financial condition, and ability to manage potential losses.

Below is a reconciliation of total stockholders’ equity to tangible book value (Non-GAAP) as of the dates indicated:

									June 30,
(Dollars in thousands, except per share amounts)															2021						2020
Total stockholders’ equity															$	1,400,936					$	1,230,846
Less: preferred stock															—						5,063
Common stockholders’ equity															1,400,936						1,225,783
Less: mortgage servicing rights, carried at fair value															17,911						10,675
Less: goodwill and other intangible assets															115,972						125,389
Tangible common stockholders’ equity (Non-GAAP)															$	1,267,053					$	1,089,719
Common shares outstanding at end of period															59,317,944						59,612,635
Tangible book value per common share (Non-GAAP)															$	21.36					$	18.28

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Forward-Looking Safe Harbor Statement

This press release contains forward-looking statements that involve risks and uncertainties, including without limitation statements relating to Axos’ financial prospects and other projections of its performance and asset quality, Axos’ ability to continue to grow profitably and increase its business, following closing, Axos’ ability to integrate E*TRADE Advisor Services and realize the benefits of the transaction, Axos’ ability to continue to diversify its lending and deposit franchises and the anticipated timing and financial performance of other offerings, initiatives, and acquisitions. These forward-looking statements are made on the basis of the views and assumptions of management regarding future events and performance as of the date of this press release. Actual results and the timing of events could differ materially from those expressed or implied in such forward-looking statements as a result of risks and uncertainties, including without limitation uncertainties surrounding the severity, duration, and effects of the COVID-19 pandemic, Axos’ ability to successfully integrate acquisitions and realize the anticipated benefits of the transactions, changes in the interest rate environment, inflation, government regulation, general economic conditions, conditions in the real estate markets in which we operate, risks associated with credit quality, the outcome and effects of pending class action litigation filed against the Company and other factors beyond our control. These and other risks and uncertainties detailed in Axos’ periodic reports filed with the Securities and Exchange Commission could cause actual results to differ materially from those expressed or implied in any forward-looking statements. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. All forward-looking statements are qualified in their entirety by this cautionary statement, and Axos undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this press release.

Investor Relations Contact:

Johnny Lai, CFA

VP, Corporate Development & Investor Relations

1-858-649-2218

[email protected]

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The following tables set forth certain selected financial data concerning the periods indicated:

AXOS FINANCIAL, INC. AND SUBSIDIARIES

SELECTED CONSOLIDATED FINANCIAL INFORMATION

(Unaudited – dollars in thousands)

 

(Dollars in thousands)			June 30, 2021						June 30, 2020						June 30, 2019
Selected Balance Sheet Data:
Total assets			$	14,265,565					$	13,851,900					$	11,220,238
Loans—net of allowance for credit losses			11,414,814						10,631,349						9,382,124
Loans held for sale, carried at fair value			29,768						51,995						33,260
Loans held for sale, lower of cost or fair value			12,294						44,565						4,800
Allowance for credit losses - loans			132,958						75,807						57,085
Securities—trading			1,983						105						—
Securities—available-for-sale			187,335						187,627						227,513
Securities borrowed			619,088						222,368						144,706
Customer, broker-dealer and clearing receivables			369,815						220,266						203,192
Total deposits			10,815,797						11,336,694						8,983,173
Advances from the FHLB			353,500						242,500						458,500
Borrowings, subordinated notes and debentures			221,358						235,789						168,929
Securities loaned			728,988						255,945						198,356
Customer, broker-dealer and clearing payables			535,425						347,614						238,604
Total stockholders’ equity			1,400,936						1,230,846						1,073,050
Capital Ratios:
Equity to assets at end of period			9.82		%				8.89		%				9.56		%
Axos Financial, Inc.:
Tier 1 leverage (core) capital to adjusted average assets			8.82		%				8.97		%				8.75		%
Common equity tier 1 capital (to risk-weighted assets)			11.36		%				11.22		%				11.43		%
Tier 1 capital (to risk-weighted assets)			11.36		%				11.27		%				11.49		%
Total capital (to risk-weighted assets)			13.78		%				12.64		%				12.91		%
Axos Bank:
Tier 1 leverage (core) capital to adjusted average assets			9.45		%				9.25		%				9.21		%
Common equity tier 1 capital (to risk-weighted assets)			12.28		%				11.79		%				12.14		%
Tier 1 capital (to risk-weighted assets)			12.28		%				11.79		%				12.14		%
Total capital (to risk-weighted assets)			13.21		%				12.62		%				12.89		%
Axos Clearing, LLC:
Net capital			$	35,950					$	34,022					$	25,027
Excess capital			$	27,904					$	29,450					$	21,199
Net capital as a percentage of aggregate debit items			8.94		%				14.88		%				13.08		%
Net capital in excess of 5% aggregate debit items			$	15,836					$	22,593					$	15,458

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AXOS FINANCIAL, INC. AND SUBSIDIARIES

SELECTED CONSOLIDATED FINANCIAL INFORMATION

(Unaudited – dollars in thousands, except per share data)

			At or for the Three Months Ended												At or for the Fiscal year ending
			June 30,												June 30,
(Dollars in thousands, except per share data)			2021						2020						2021						2020
Selected Income Statement Data:
Interest and dividend income			$	156,921					$	144,143					$	617,863					$	622,839
Interest expense			15,267						26,871						79,121						145,228
Net interest income			141,654						117,272						538,742						477,611
Provision for credit losses			1,250						6,500						23,750						42,200
Net interest income after provision for loan losses			140,404						110,772						514,992						435,411
Non-interest income			16,801						28,702						105,261						102,987
Non-interest expense			81,860						71,544						314,510						275,766
Income before income tax expense			75,345						67,930						305,743						262,632
Income tax expense			21,090						22,630						90,036						79,194
Net income			$	54,255					$	45,300					$	215,707					$	183,438
Net income attributable to common stock			$	54,255					$	45,223					$	215,518					$	183,129
Per Share Data:
Net income:
Basic			$	0.92					$	0.76					$	3.64					$	3.01
Diluted			$	0.90					$	0.75					$	3.56					$	2.98
Adjusted earnings per common share (Non-GAAP)			$	0.92					$	0.78					$	3.68					$	3.10
Book value per common share			$	23.62					$	20.56					$	23.62					$	20.56
Tangible book value per common share (Non-GAAP)			$	21.36					$	18.28					$	21.36					$	18.28
Weighted average number of shares outstanding:
Basic			59,241,753						59,648,076						59,229,495						60,794,555
Diluted			60,546,574						60,158,545						60,519,611						61,437,635
Common shares outstanding at end of period			59,317,944						59,612,635						59,317,944						59,612,635
Common shares issued at end of period			68,069,321						67,323,053						68,069,321						67,323,053
Performance Ratios and Other Data:
Loan originations for investment			$	1,824,527					$	1,317,826					$	7,304,414					$	6,797,971
Loan originations for sale			$	259,017					$	315,349					$	1,608,700					$	1,601,579
Loan purchases			$	1,435					$	—					$	3,619					$	—
Return on average assets			1.46		%				1.45		%				1.52		%				1.53		%
Return on average common stockholders’ equity			15.56		%				14.71		%				16.51		%				15.65		%
Interest rate spread1			3.73		%				3.53		%				3.70		%				3.65		%
Net interest margin2			3.92		%				3.89		%				3.92		%				4.12		%
Net interest margin2 - Banking Business Segment only			4.16		%				3.95		%				4.11		%				4.19		%
Efficiency ratio3			51.66		%				49.01		%				48.84		%				47.50		%
Efficiency ratio3 - Banking Business Segment only			45.20		%				41.02		%				41.95		%				39.81		%
Asset Quality Ratios:
Net annualized charge-offs to average loans			0.22		%				0.67		%				0.12		%				0.23		%
Net annualized charge-offs to average loans, excluding seasonal tax loan products			0.01		%				0.05		%				0.07		%				0.08		%
Non-performing loans to total loans			1.26		%				0.82		%				1.26		%				0.82		%
Non-performing assets to total assets			1.07		%				0.68		%				1.07		%				0.68		%
Allowance for credit losses to total loans held for investment at end of period			1.15		%				0.71		%				1.15		%				0.71		%
Allowance for credit losses to non-performing loans			91.57		%				86.20		%				91.57		%				86.20		%

1.     Interest rate spread represents the difference between the annualized weighted average yield on interest-earning assets and the annualized weighted average rate paid on interest-bearing liabilities

2.    Net interest margin represents annualized net interest income as a percentage of average interest-earning assets

3. Efficiency ratio represents non-interest expense as a percentage of the aggregate of net interest income and non-interest income.

AXOS FINANCIAL, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Unaudited)

			At June 30,
(Dollars in thousands, except par and stated value)			2021						2020
ASSETS
Cash and due from banks			$	715,624					$	1,756,477
Cash segregated for regulatory purposes			322,153						194,042
Total cash, cash equivalents, cash segregated			1,037,777						1,950,519
Securities:
Trading			1,983						105
Available-for-sale			187,335						187,627
Stock of regulatory agencies			19,995						20,610
Loans held for sale, carried at fair value			29,768						51,995
Loans held for sale, lower of cost or fair value			12,294						44,565
Loans—net of allowance for credit losses of $133.0 million as of June 2021 and $75.8 million as of June 2020			11,414,814						10,631,349
Mortgage servicing rights, carried at fair value			17,911						10,675
Other real estate owned and repossessed vehicles			6,782						6,408
Securities borrowed			619,088						222,368
Customer, broker-dealer and clearing receivables			369,815						220,266
Goodwill and other intangible assets—net			115,972						125,389
Other assets			432,031						380,024
TOTAL ASSETS			$	14,265,565					$	13,851,900
LIABILITIES AND STOCKHOLDERS’ EQUITY
Deposits:
Non-interest bearing			$	2,474,424					$	1,936,661
Interest bearing			8,341,373						9,400,033
Total deposits			10,815,797						11,336,694
Advances from the Federal Home Loan Bank			353,500						242,500
Borrowings, subordinated notes and debentures			221,358						235,789
Securities loaned			728,988						255,945
Customer, broker-dealer and clearing payables			535,425						347,614
Accounts payable and accrued liabilities and other liabilities			209,561						202,512
Total liabilities			12,864,629						12,621,054
STOCKHOLDERS’ EQUITY:
Preferred stock—$0.01 par value; 1,000,000 shares authorized;
Series A—$10,000 stated value and liquidation preference per share; 0 shares issued and outstanding as of June 2021 and 515 shares issued and outstanding as of June 2020			—						5,063
Common stock—$0.01 par value; 150,000,000 shares authorized, 68,069,321 shares issued and 59,317,944 shares outstanding as of June 2021, 67,323,053 shares issued and 59,612,635 shares outstanding as of June 2020			681						673
Additional paid-in capital			432,550						411,873
Accumulated other comprehensive income (loss)—net of tax			2,507						(937)
Retained earnings			1,187,728						1,009,299
Treasury stock, at cost; 8,751,377 shares as of June 2021 and 7,710,418 shares as of June 2020			(222,530)						(195,125)
Total stockholders’ equity			1,400,936						1,230,846
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY			$	14,265,565					$	13,851,900

S-1

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AXOS FINANCIAL, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

			For the Quarters Ended June 30,
(Dollars in thousands, except earnings per share)			2021						2020
INTEREST AND DIVIDEND INCOME:
Loans, including fees			$	147,965					$	137,194
Securities borrowed and customer receivables			6,270						3,560
Investments			2,686						3,389
Total interest and dividend income			156,921						144,143
INTEREST EXPENSE:
Deposits			10,846						23,942
Advances from the Federal Home Loan Bank			982						1,777
Securities loaned			664						115
Other borrowings			2,775						1,037
Total interest expense			15,267						26,871
Net interest income			141,654						117,272
Provision for credit losses			1,250						6,500
Net interest income, after provision for credit losses			140,404						110,772
NON-INTEREST INCOME:
Prepayment penalty fee income			2,877						1,169
Gain on sale - other			(213)						517
Mortgage banking income			2,895						12,673
Broker-dealer fee income			6,386						5,670
Banking and service fees			4,856						8,673
Total non-interest income			16,801						28,702
NON-INTEREST EXPENSE:
Salaries and related costs			37,209						37,409
Data processing			12,947						8,887
Depreciation and amortization			6,211						6,982
Professional services			4,901						3,163
Advertising and promotional			3,612						2,803
Occupancy and equipment			4,163						3,180
Broker-dealer clearing charges			3,166						2,162
FDIC and regulatory fees			2,203						2,395
General and administrative expense			7,448						4,563
Total non-interest expense			81,860						71,544
INCOME BEFORE INCOME TAXES			75,345						67,930
INCOME TAXES			21,090						22,630
NET INCOME			$	54,255					$	45,300
NET INCOME ATTRIBUTABLE TO COMMON STOCK			$	54,255					$	45,223
COMPREHENSIVE INCOME			$	54,469					$	47,089
Basic earnings per share			$	0.92					$	0.76
Diluted earnings per share			$	0.90					$	0.75

S-2

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AXOS FINANCIAL, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

			Year Ended June 30,
(Dollars in thousands, except earnings per share)			2021						2020						2019
INTEREST AND DIVIDEND INCOME:
Loans, including fees			$	584,410					$	582,748					$	525,317
Securities borrowed and customer receivables			20,466						16,585						8,746
Investments			12,987						23,506						30,824
Total interest and dividend income			617,863						622,839						564,887
INTEREST EXPENSE:
Deposits			60,529						126,916						117,080
Advances from the Federal Home Loan Bank			4,672						11,988						32,834
Securities loaned			1,496						679						748
Other borrowings			12,424						5,645						5,620
Total interest expense			79,121						145,228						156,282
Net interest income			538,742						477,611						408,605
Provision for credit losses			23,750						42,200						27,350
Net interest income, after provision for credit losses			514,992						435,411						381,255
NON-INTEREST INCOME:
Realized gain (loss) on sale of securities			—						—						709
Other-than-temporary loss on securities:
Other-than-temporary loss on securities:			—						—						(1,666)
Less: Portion of other temporary impairment losses recognized in OCI			—						—						845
Change to net impairment losses recognized in earnings on securities			—						—						(821)
Total unrealized loss on securities			—						—						(821)
Prepayment penalty fee income			7,166						5,993						5,851
Gain on sale - other			491						6,871						6,160
Mortgage banking income			42,150						20,646						5,267
Broker-dealer fee income			26,317						23,210						11,737
Banking and service fees			29,137						46,267						53,854
Total non-interest income			105,261						102,987						82,757
NON-INTEREST EXPENSE:
Salaries and related costs			152,576						144,341						127,433
Data processing			40,719						30,671						24,150
Depreciation and amortization			24,124						24,443						16,471
Professional services			22,241						11,095						11,916
Advertising and promotional			14,212						14,523						14,710
Occupancy and equipment			13,402						12,059						8,571
Broker-dealer clearing charges			11,152						8,210						2,822
FDIC and regulatory fees			10,603						5,538						9,005
General and administrative expense			25,481						24,886						36,128
Total non-interest expense			314,510						275,766						251,206
INCOME BEFORE INCOME TAXES			305,743						262,632						212,806
INCOME TAXES			90,036						79,194						57,675
NET INCOME			$	215,707					$	183,438					$	155,131
NET INCOME ATTRIBUTABLE TO COMMON STOCK			$	215,518					$	183,129					$	154,822
COMPREHENSIVE INCOME			$	219,151					$	182,485					$	155,760
Basic earnings per share			$	3.64					$	3.01					$	2.50
Diluted earnings per share			$	3.56					$	2.98					$	2.48

S-3

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AXOS FINANCIAL, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

			Year Ended June 30,
(Dollars in thousands)			2021						2020						2019
NET INCOME			$	215,707					$	183,438					$	155,131
Net unrealized gain (loss) from available-for-sale securities, net of tax expense (benefit) of $1,495, $(381), and $562 for the years ended June 30, 2021, 2020 and 2019, respectively.			3,444						(953)						1,741
Other-than-temporary impairment on securities sold, reclassified in other comprehensive income, net of tax expense (benefit) of $0, $0, and $(251) for the years ended June 30, 2021, 2020 and 2019, respectively.			—						—						(594)
Reclassification of net (gain) loss from available-for-sale securities included in income, net of tax expense (benefit) of $0, $0, and $191 for the years ended June 30, 2021, 2020 and 2019, respectively.			—						—						(518)
Other comprehensive income (loss)			$	3,444					$	(953)					$	629
Comprehensive income			$	219,151					$	182,485					$	155,760

S-4

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AXOS FINANCIAL, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited)

			Preferred Stock												Common Stock																								Additional Paid-in Capital						Retained Earnings						Accumulated Other Comprehensive Income (Loss), Net of Income Tax						Treasury Stock						Total
															Number of Shares
(Dollars in thousands)			Shares						Amount						Issued						Treasury						Outstanding						Amount
Balance as of June 30, 2018			515						$	5,063					65,796,060						(3,107,996)						62,688,064						$	658					$	366,515					$	671,348					$	(613)					$	(82,458)					$	960,513
Net income			—						—						—						—						—						—						—						155,131						—						—						155,131
Other comprehensive income (loss)			—						—						—						—						—						—						—						—						629						—						629
Cash dividends on preferred stock			—						—						—						—						—						—						—						(309)						—						—						(309)
Purchase of treasury stock			—						—						—						(2,009,352)						(2,009,352)						—						—						—						—						(56,437)						(56,437)
Stock-based compensation expense and restricted stock unit vesting			—						—						767,862						(317,757)						450,105						8						23,430						—						—						(9,915)						13,523
Balance as of June 30, 2019			515						$	5,063					66,563,922						(5,435,105)						61,128,817						$	666					$	389,945					$	826,170					$	16					$	(148,810)					$	1,073,050
Net income			—						—						—						—						—						—						—						183,438						—						—						183,438
Other comprehensive income (loss)			—						—						—						—						—						—						—						—						(953)						—						(953)
Cash dividends on preferred stock			—						—						—						—						—						—						—						(309)						—						—						(309)
Purchase of treasury stock			—						—						—						(1,970,464)						(1,970,464)						—						—						—						—						(38,858)						(38,858)
Stock-based compensation expense and restricted stock unit vesting			—						—						759,131						(304,849)						454,282						7						21,928						—						—						(7,457)						14,478
Balance as of June 30, 2020			515						$	5,063					67,323,053						(7,710,418)						59,612,635						$	673					$	411,873					$	1,009,299					$	(937)					$	(195,125)					$	1,230,846
Cumulative effect of change in accounting principle net of tax, adoption of ASU No. 2016-13			—						—						—						—						—						—						—						(37,088)						—						—						(37,088)
Net income			—						—						—						—						—						—						—						215,707						—						—						215,707
Other comprehensive income (loss)			—						—						—						—						—						—						—						—						3,444						—						3,444
Cash dividends on preferred stock			—						—						—						—						—						—						—						(103)						—						—						(103)
Preferred stock - Series A redemption			(515)						(5,063)						—						—						—						—						—						(87)						—						—						(5,150)
Purchase of treasury stock			—						—						—						(753,597)						(753,597)						—						—						—						—						(16,757)						(16,757)
Stock-based compensation expense and restricted stock unit vesting			—						—						746,268						(287,362)						458,906						8						20,677						—						—						(10,648)						10,037
Balance as of June 30, 2021			—						$	—					68,069,321						(8,751,377)						59,317,944						$	681					$	432,550					$	1,187,728					$	2,507					$	(222,530)					$	1,400,936

S-5

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AXOS FINANCIAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
			Year Ended June 30,
(Dollars in thousands)			2021						2020						2019
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income			$	215,707					$	183,438					$	155,131
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Accretion and amortization on securities, net			(365)						291						(264)
Net accretion of discounts on loans			(7,050)						(35,493)						(30,176)
Amortization of borrowing costs			1,569						208						208
Amortization of operating lease right of use asset			10,598						10,543						—
Stock-based compensation expense			20,685						21,935						23,439
Trading activity, (net)			(1,878)						1,217						—
Net (gain) loss on sale of investment securities			—						—						(709)
Impairment charge on securities			—						—						821
Provision for credit losses			23,750						42,200						27,350
Broker-dealer reserve for bad debt			—						—						15,298
Deferred income taxes			(8,828)						(6,551)						(8,686)
Origination of loans held for sale			(1,608,700)						(1,601,579)						(1,471,906)
Unrealized (gain) loss on loans held for sale			1,469						(1,360)						(252)
Gain on sales of loans held for sale			(42,641)						(27,517)						(11,427)
Proceeds from sale of loans held for sale			1,671,515						1,614,379						1,481,911
Amortization and change in fair value of mortgage servicing rights			6,319						5,806						3,362
(Gain) loss on sale of other real estate and foreclosed assets			(201)						(449)						(283)
Depreciation and amortization			24,124						24,443						16,471
Net changes in assets and liabilities which provide (use) cash:
Securities borrowed			(396,720)						(77,662)						13,192
Customer, broker-dealer and clearing receivables			(149,549)						(17,074)						13,684
Other assets			(7,259)						(36,979)						(27,564)
Securities loaned			473,043						57,589						(4,685)
Customer, broker-dealer and clearing payables			187,811						109,010						(1,506)
Accounts payable and other liabilities			(817)						17,723						11,012
Net cash provided by operating activities			$	412,582					$	284,118					$	204,421
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of investment securities			(122,338)						(304,930)						(146,886)
Proceeds from sales of securities			3,600						—						15,863
Proceeds from repayment of securities			71,067						325,704						93,779
Purchase of stock of regulatory agencies			(305)						(55,870)						(204,206)
Proceeds from redemption of stock of regulatory agencies			920						55,536						203,611
Origination of loans held for investment			(5,761,303)						(6,573,568)						(6,756,832)
Proceeds from sale of loans and leases held for investment			80,049						37,300						119,881
Mortgage warehouse loans activity, net			(139,806)						(172,319)						(126,491)
Proceeds from sales of other real estate owned and repossessed assets			1,586						2,241						2,202
Cash paid for deposit acquisition			—						—						(14,747)
Acquisition of business activity, net of cash paid			—						—						67,343
Purchases of loans, net of discounts and premiums			(3,619)						—						(11,525)
Principal repayments on loans			5,013,817						5,349,800						5,846,349
Purchases of furniture, equipment, software and intangibles			(10,437)						(12,333)						(20,082)
Net cash used in investing activities			$	(866,769)					$	(1,348,439)					$	(931,741)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net increase (decrease) in deposits			(520,897)						2,353,521						997,823
Proceeds from the Federal Home Loan Bank term advances			—						65,000						—
Repayments of the Federal Home Loan Bank term advances			(70,000)						(55,000)						(147,500)
Net (repayment) proceeds of Federal Home Loan Bank other advances			181,000						(226,000)						149,000
Redemption of subordinated notes			(51,000)						—						—
Repayment of Paycheck Protection Program Liquidity Facility advances			(151,952)						—						—
Proceeds from Paycheck Protection Program Liquidity Facility advances			—						151,952						—
Net (repayment) proceeds of other borrowings			14,700						(85,300)						21,700
Tax payments related to settlement of restricted stock units			(10,648)						(7,457)						(9,916)
Repurchase of treasury stock			(16,757)						(38,858)						(56,437)
Redemption of preferred stock, Series A			(5,150)						—						—
Cash dividends paid on preferred stock			(103)						(386)						(232)
Payment of debt issuance costs			(2,748)						—						—
Proceeds from issuance of subordinated notes			175,000						—						7,400
Net cash provided by financing activities			$	(458,555)					$	2,157,472					$	961,838
NET CHANGE IN CASH AND CASH EQUIVALENTS			(912,742)						1,093,151						234,518
CASH AND CASH EQUIVALENTS—Beginning of year			1,950,519						857,368						622,850
CASH AND CASH EQUIVALENTS—End of year			$	1,037,777					$	1,950,519					$	857,368
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Interest paid on interest-bearing liabilities			$	77,995					$	145,452					$	152,756
Income taxes paid			92,506						80,430						64,117
Transfers to other real estate and repossessed vehicles			1,903						1,315						850
Transfers from loans and leases held for investment to loans held for sale			71,136						141,849						106,911
Transfers from loans held for sale to loans and leases held for investment			29,616						—						1,714
Securities transferred from available-for-sale portfolio to other assets			70,751						17,482						—
Loans held for investment sold, cash not received			—						61,029						—
Operating lease liabilities for obtaining right of use assets			—						82,950						—
Preferred stock dividends declared but not paid			—						—						77
Impact of adoption of ASU No. 2016-13 on retained earnings			37,088						—						—

S-6

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LOANS & ALLOWANCE FOR CREDIT LOSSES

The following table sets forth the composition of the loan portfolio as of the dates indicated:

(Unaudited) (Dollars in thousands)			June 30, 2021						June 30, 2020
Single Family - Mortgage & Warehouse			$	4,359,472					$	4,722,304
Multifamily and Commercial Mortgage			2,470,454						2,263,054
Commercial Real Estate			3,180,453						2,297,920
Commercial & Industrial - Non-RE			1,123,869						885,320
Auto & Consumer			362,180						341,365
Other			58,316						193,479
Total gross loans			11,554,744						10,703,442
Allowance for credit losses - loans			(132,958)						(75,807)
Unaccreted premiums (discounts) and loan and lease fees			(6,972)						3,714
Total net loans			$	11,414,814					$	10,631,349

S-7

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SECURITIES

The amortized cost, carrying amount and fair value for the trading and available for sale securities at June 30, 2021 and June 30, 2020 were:

			June 30, 2021
			Trading						Available for sale
(Unaudited) (Dollars in thousands)			Fair Value						Amortized Cost						Unrealized Gains						Unrealized Losses						Fair Value
Mortgage-backed securities (MBS):
U.S agencies1			$	—					$	23,639					$	420					$	(146)					$	23,913
Non-agency2			—						65,174						2,862						(421)						67,615
Total mortgage-backed securities			—						88,813						3,282						(567)						91,528
Non-MBS:
U.S. agencies1			—						—						—						—						—
Municipal			1,983						3,466						99						—						3,565
Asset-backed securities and structured notes			—						90,549						1,693						—						92,242
Total other debt securities			1,983						94,015						1,792						—						95,807
Total debt securities			$	1,983					$	182,828					$	5,074					$	(567)					$	187,335
			June 30, 2020
			Trading						Available for sale
(Unaudited) (Dollars in thousands)			Fair Value						Amortized Cost						Unrealized Gains						Unrealized Losses						Fair Value
Mortgage-backed securities (MBS):
U.S agencies1			$	—					$	16,192					$	634					$	—					$	16,826
Non-agency2			—						18,180						1,024						(872)						18,332
Total mortgage-backed securities			—						34,372						1,658						(872)						35,158
Non-MBS:
U.S. agencies1			—						1,799						—						—						1,799
Municipal			105						10,550						44						(194)						10,400
Asset-backed securities and structured notes			—						141,338						1						(1,069)						140,270
Total other debt securities			105						153,687						45						(1,263)						152,469
Total debt securities			$	105					$	188,059					$	1,703					$	(2,135)					$	187,627

1 Includes securities guaranteed by Ginnie Mae, a U.S. government agency, and the government sponsored enterprises Fannie Mae and Freddie Mac.

2 Private sponsors of securities collateralized primarily by first - lien mortgage loans on commercial properties or by pools of 1-4 family residential first mortgages. Primarily super senior securities secured by Alt-A or pay-option ARM mortgages.

S-8

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DEPOSITS

The following table sets forth the composition of the deposit portfolio as of the dates indicated:

(Unaudited)			June 30, 2021												June 30, 2020
(Dollars in thousands)			Amount						Rate1						Amount						Rate1
Non-interest bearing			$	2,474,424					—		%				$	1,936,661					—		%
Interest bearing:
Demand			3,369,845						0.15		%				3,456,127						0.37		%
Savings			3,458,687						0.21		%				3,697,188						0.78		%
Total interest-bearing demand and savings			6,828,532						0.18		%				7,153,315						0.58		%
Time deposits:
$250 and under			1,070,139						1.30		%				1,584,034						2.12		%
Greater than $250			442,702						1.03		%				662,684						1.39		%
Total time deposits			1,512,841						1.22		%				2,246,718						1.91		%
Total interest bearing2			8,341,373						0.37		%				9,400,033						0.90		%
Total deposits			$	10,815,797					0.29		%				$	11,336,694					0.75		%

1. Based on weighted-average stated interest rates at end of period.

2. The total interest-bearing includes brokered deposits of $621.4 million and $1,318.0 million as of June 30, 2021 and June 30, 2020, respectively, of which $380.0 million and $603.6 million, respectively, are time deposits classified as $250 and under.

The number of deposit accounts at the end of each of the last five fiscal years is set forth below:

			At June 30,
			2021						2020						2019						2018						2017
Non-interest-bearing, prepaid and other			36,726						3,361,965						3,743,334						3,535,904						3,113,128
Checking and savings accounts			336,068						310,463						311,067						270,082						274,962
Time deposits			12,815						18,450						23,447						2,309						2,748
Total number of deposit accounts			385,609						3,690,878						4,077,848						3,808,295						3,390,838

Our non-interest bearing, prepaid and other accounts contained two omnibus accounts that when condensed for regulatory reporting purposes result in 27,108 accounts, 16,706 accounts, 7,370 accounts, and 5,636 accounts for the years ended June 30, 2020, 2019, 2018, and 2017, respectively. The two omnibus accounts represented $351.9 million, $446.5 million, $402.9 million, and $366.8 million at June 30, 2020, 2019, 2018, and 2017, respectively. The decrease in the number of accounts is the result of the termination of our third-party prepaid card relationships, such as H&R Block, due to the reduction of our interchange fees effective July 1, 2020 as a result of the Durbin Amendment. See the Regulation of Banking Business in our Form 10-K for the year ended June 30, 2020 for additional information.

S-9

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AVERAGE BALANCES, NET INTEREST INCOME, YIELDS EARNED AND RATES PAID

The following table presents information regarding (i) average balances; (ii) the total amount of interest income from interest-earning assets and the weighted average yields on such assets; (iii) the total amount of interest expense on interest-bearing liabilities and the weighted average rates paid on such liabilities; (iv) net interest income; (v) interest rate spread; and (vi) net interest margin:

			For the three months ended June 30,
			2021																		2020
(Unaudited) (Dollars in thousands)			Average Balance2						Interest Income / Expense						Average Yields Earned / Rates Paid1						Average Balance2						Interest Income / Expense						Average Yields Earned / Rates Paid1
Assets:
Loans3,4			$	11,485,248					$	147,965					5.15		%				$	10,570,886					$	137,194					5.19		%
Interest-earning deposits in other financial institutions			1,930,140						703						0.15		%				930,622						365						0.16		%
Securities4			158,221						1,376						3.48		%				231,396						2,858						4.94		%
Securities borrowed and margin lending			864,702						6,270						2.90		%				297,163						3,560						4.79		%
Stock of the regulatory agencies			20,520						607						11.83		%				28,719						166						2.31		%
Total interest-earning assets			14,458,831						156,921						4.34		%				12,058,786						144,143						4.78		%
Non-interest-earning assets			438,287																		411,004
Total assets			$	14,897,118																	$	12,469,790
Liabilities and Stockholders’ Equity:
Interest-bearing demand and savings			$	7,441,814					$	5,118					0.28		%				$	5,092,648					$	10,222					0.80		%
Time deposits			1,632,525						5,728						1.40		%				2,446,915						13,720						2.24		%
Securities loaned			412,385						664						0.64		%				153,573						115						0.30		%
Advances from the FHLB			171,808						982						2.29		%				807,680						1,777						0.88		%
Borrowings, subordinated notes and debentures			274,664						2,775						4.04		%				83,228						1,037						4.98		%
Total interest-bearing liabilities			9,933,196						15,267						0.61		%				8,584,044						26,871						1.25		%
Non-interest-bearing demand deposits			2,586,766																		2,139,803
Other non-interest-bearing liabilities			981,989																		510,889
Stockholders’ equity			1,395,167																		1,235,054
Total liabilities and stockholders’ equity			$	14,897,118																	$	12,469,790
Net interest income									$	141,654																	$	117,272
Interest rate spread5															3.73		%																3.53		%
Net interest margin6															3.92		%																3.89		%

1 Annualized.

2 Average balances are obtained from daily data.

3 Loans include loans held for sale, loan premiums and unearned fees.

4 Interest income includes reductions for amortization of loan and investment securities premiums and earnings from accretion of discounts and loan fees. Loans include average balances of $26.9 million and $27.7 million of Community Reinvestment Act loans which are taxed at a reduced rate for the 2021 and 2020 three-month periods respectively.

5 Interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average rate paid on interest-bearing liabilities.

6 Net interest margin represents net interest income as a percentage of average interest-earning assets.

S-10

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AVERAGE BALANCES, NET INTEREST INCOME, YIELDS EARNED AND RATES PAID

The following tables set forth, for the periods indicated, information regarding (i) average balances; (ii) the total amount of interest income from interest-earning assets and the weighted average yields on such assets; (iii) the total amount of interest expense on interest-bearing liabilities and the weighted average rates paid on such liabilities; (iv) net interest income; (v) interest rate spread; and (vi) net interest margin:

			For the Fiscal Years Ended June 30,
			2021																		2020																		2019
(Unaudited)(Dollars in thousands)			Average Balance1						Interest Income / Expense						Average Yields Earned / Rates Paid						Average Balance1						Interest Income / Expense						Average Yields Earned / Rates Paid						Average Balance1						Interest Income / Expense						Average Yields Earned / Rates Paid
Assets:
Loans2,3			$	11,332,020					$	584,410					5.16		%				$	10,149,867					$	582,748					5.74		%				$	8,974,820					$	525,317					5.85		%
Interest-earning deposits in other financial institutions			1,600,811						2,185						0.14		%				833,612						10,906						1.31		%				631,228						13,495						2.14		%
Securities3			192,420						9,560						4.97		%				217,598						11,061						5.08		%				210,189						13,943						6.63		%
Securities borrowed and margin lending			613,735						20,466						3.33		%				362,063						16,585						4.58		%				173,829						8,746						5.03		%
Stock of the regulatory agencies			20,588						1,242						6.03		%				28,776						1,539						5.35		%				41,078						3,386						8.24		%
Total interest-earning assets			13,759,574						617,863						4.49		%				11,591,916						622,839						5.37		%				10,031,144						564,887						5.63		%
Non-interest-earning assets			394,085																		395,789																		234,993
Total assets			$	14,153,659																	$	11,987,705																	$	10,266,137
Liabilities and Stockholders’ Equity:
Interest-bearing demand and savings			$	7,204,698					$	29,031					0.40		%				$	4,844,700					$	66,883					1.38		%				$	3,906,833					$	61,391					1.57		%
Time deposits			1,825,795						31,498						1.73		%				2,482,151						60,033						2.42		%				2,322,039						55,689						2.40		%
Securities loaned			412,385						1,496						0.36		%				247,420						679						0.27		%				221,469						748						0.34		%
Advances from the FHLB			211,077						4,672						2.21		%				747,358						11,988						1.60		%				1,397,460						32,834						2.35		%
Borrowings, subordinated notes and debentures			340,699						12,424						3.65		%				103,652						5,645						5.45		%				104,287						5,620						5.39		%
Total interest-bearing liabilities			9,994,654						79,121						0.79		%				8,425,281						145,228						1.72		%				7,952,088						156,282						1.97		%
Non-interest-bearing demand deposits			2,182,009																		1,990,005																		1,227,285
Other non-interest-bearing liabilities			671,581																		397,506																		76,651
Stockholders’ equity			1,305,415																		1,174,913																		1,010,113
Total liabilities and stockholders’ equity			$	14,153,659																	$	11,987,705																	$	10,266,137
Net interest income									$	538,742																	$	477,611																	$	408,605
Interest rate spread4															3.70		%																3.65		%																3.66		%
Net interest margin5															3.92		%																4.12		%																4.07		%

1 Average balances are obtained from daily data.

2 Loans include loans held for sale, loan premiums and unearned fees.

3 Interest income includes reductions for amortization of loan and investment securities premiums and earnings from accretion of discounts and loan fees. Loans include average balances of $27.2 million, $28.0 million, and $28.7 million of Community Reinvestment Act loans which are taxed at a reduced rate for the 2021 2020, and 2019 fiscal years respectively.

4 Interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average rate paid on interest-bearing liabilities.

5 Net interest margin represents net interest income as a percentage of average interest-earning assets.

S-11

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AVERAGE BALANCES, NET INTEREST INCOME, YIELDS EARNED AND RATES PAID

BANKING BUSINESS

The following table presents our Banking segment’s information regarding (i) average balances; (ii) the total amount of interest income from interest-earning assets and the weighted average yields on such assets; (iii) the total amount of interest expense on interest-bearing liabilities and the weighted average rates paid on such liabilities; (iv) net interest income; (v) interest rate spread; and (vi) net interest margin for the three months ended June 30, 2021 and 2020:

			For the Three Months Ended
			June 30,
			2021																		2020
(Dollars in thousands)			Average Balance1						Interest Income/ Expense						Average Yields Earned/Rates Paid2						Average Balance1						Interest Income/ Expense						Average Yields Earned/Rates Paid2
Assets:
Loans3, 4			$	11,444,379					$	147,235					5.15		%				$	10,516,828					$	136,532					5.19		%
Interest-earning deposits in other financial institutions			1,579,835						413						0.10		%				763,989						192						0.10		%
Securities4			182,874						1,505						3.29		%				269,288						3,137						4.66		%
Stock of the regulatory agencies			17,250						301						6.98		%				25,474						165						2.59		%
Total interest-earning assets			13,224,338						149,454						4.52		%				11,575,579						140,026						4.84		%
Non-interest-earning assets			217,543																		185,795
Total assets			$	13,441,881																	$	11,761,374
Liabilities and Stockholders’ Equity:
Interest-bearing demand and savings			$	7,553,737					$	5,213					0.28		%				$	5,108,866					$	10,254					0.80		%
Time deposits			1,632,525						5,728						1.40		%				2,446,915						13,720						2.24		%
Advances from the FHLB			171,808						982						2.29		%				807,680						1,777						0.88		%
Borrowings, subordinated notes and debentures			44,983						40						0.36		%				12,416						11						0.35		%
Total interest-bearing liabilities			9,403,053						11,963						0.51		%				8,375,877						25,762						1.23		%
Non-interest-bearing demand deposits			2,629,016																		2,148,671
Other non-interest-bearing liabilities			104,885																		98,020
Stockholders’ equity			1,304,927																		1,138,806
Total liabilities and stockholders’ equity			$	13,441,881																	$	11,761,374
Net interest income									$	137,491																	$	114,264
Interest rate spread5															4.01		%																3.61		%
Net interest margin6															4.16		%																3.95		%

1. Average balances are obtained from daily data.

2. Annualized.

3. Loans include loans held for sale, loan premiums and unearned fees.

4. Interest income includes reductions for amortization of loan and investment securities premiums and earnings from accretion of discounts and loan fees. Loans include average balances of $26.9 million and $27.7 million of Community Reinvestment Act loans which are taxed at a reduced rate for the 2021 and 2020 three-month periods respectively.

5. Interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average rate paid on interest-bearing liabilities.

6. Net interest margin represents annualized net interest income as a percentage of average interest-earning assets.

S-12

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SECURITIES BUSINESS

Selected information concerning Axos Clearing LLC follows as of and for the three months ended:

(Dollars in thousands)			June 30, 2021						June 30, 2020
Compensation as a % of net revenue			32.4		%				39.2		%
FDIC insured program balances at banks (end of period)			$	730,248					$	450,251
Customer margin balances (end of period)			$	327,148					$	206,702
Customer funds on deposit, including short credits (end of period)			$	322,153					$	194,042
Clearing:
Total tickets			2,053,362						1,228,635
Correspondents (end of period)			69						61
Securities lending:
Interest-earning assets – stock borrowed (end of period)			$	619,088					$	222,368
Interest-bearing liabilities – stock loaned (end of period)			$	728,988					$	255,945

S-13

Axos Q4 2021 Earnings Supplement July 29, 2021 NYSE: AX

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Safe Harbor 1 This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (the “Reform Act”). The words “believe,” “expect,” “anticipate,” “estimate,” “project,” or the negation thereof or similar expressions constitute forward-looking statements within the meaning of the Reform Act. These statements may include, but are not limited to, projections of revenues, income or loss, projected consummation of pending acquisitions, including the acquisition of E*TRADE Advisor Services, estimates of capital expenditures, plans for future operations, products or services, the effects of the COVID-19 pandemic, and financing needs or plans, as well as assumptions relating to these matters. Such statements involve risks, uncertainties and other factors that may cause actual results, performance or achievements of the Company and its subsidiaries to be materially different from any future results, performance looking statements. For a discussion of these factors, we refer you to the Company's reports filed with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended June 30, 2020 and our last earnings press release. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by the Company or by any other person or entity that the objectives and plans of the Company will be achieved. For all forward-looking statements, the Company claims the protection of the safe-harbor for forward-looking statements contained in the Reform Act. or achievements expressed or implied by such forward-

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2 Net Loan Growth by Category for Fourth Quarter Ended June 30, 2021 Loans & Leases Single Family Mortgage & Warehouse Multifamily & SB Commercial Mortgage Commercial Real Estate Auto & Consumer Jumbo Mortgage Multifamily Small Balance Commercial Lender Finance RE SF Warehouse Lending SBLOC & Other Auto CRE Specialty Unsecured / OD Equipment Leasing Q4 FY21 $ Millions Other PPP Refund Advance & Other Q3 FY21 $3,745 614 2,020 450 3,090 91 112 300 62 55 4 ($186) (354) 57 (11) 179 (41) (9) 34 4 (6) Inc (Dec) $3,931 968 1,963 461 2,911 132 121 266 58 125 10 Commercial & Industrial Non-RE Lender Finance Non RE 580 523 57 432 387 45 $11,555 $11,856 $(301) (70)

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Change in Allowance for Credit Losses (ACL) & Unfunded Loan Commitments Liability (UCL) ($ in millions) 3

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4 Allowance for Credit Losses (ACL) by Loan and Lease Category at June 30, 2021 Loans & Leases Single Family - Mortgage and Warehouse Multifamily & SB Commercial Mortgage Commercial Real Estate Auto & Consumer Loan Balance $ Millions Other ACL $ $4,359.5 2,470.4 3,180.4 362.2 58.3 ACL % Commercial & Industrial Non-RE 1,123.9 $11,554.7 13.2 57.9 6.5 0.3 28.5 $26.6 $133.0 1.15% 1.82% 0.53% 0.61% 0.51% 1.79% 2.54%

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Credit Quality No Loans in Forbearance 5 3/31/2021 Loans O/S Loans in Forbearance or Deferral % NPAs % Single Family-Mortgage & Warehouse $4,899.2 $0.0 0.00% $85.0 1.74% Multifamily and Commercial Mortgage $2,424.2 $0.0 0.00% $30.8 1.27% Commercial Real Estate $3,042.9 $0.0 0.00% $16.4 0.54% Commercial & Industrial - Non-RE $1,030.9 $0.0 0.00% $3.0 0.29% Auto & Consumer $323.6 $0.0 0.00% $0.4 0.12% Other $135.7 $0.0 0.00% $0.0 0.00% Total $11,856.5 $0.0 0.00% $135.6 1.14% 6/30/2021 Loans O/S Loans in Forbearance or Deferral % NPAs % Single Family-Mortgage & Warehouse $4,359.5 $0.0 0.00% $105.7 2.42% Multifamily and Commercial Mortgage $2,470.4 $0.0 0.00% $20.4 0.83% Commercial Real Estate $3,180.4 $0.0 0.00% $15.8 0.50% Commercial & Industrial - Non-RE $1,123.9 $0.0 0.00% $2.9 0.26% Auto & Consumer $362.2 $0.0 0.00% $0.3 0.08% Other $58.3 $0.0 0.00% $0.0 0.00% Total $11,554.7 $0.0 0.00% $145.1 1.26% Change from 3/31/21 to 6/30/21 Loans O/S Loans in Forbearance or Deferral NPAs Single Family-Mortgage & Warehouse -$539.7 $0.0 $20.7 Multifamily and Commercial Mortgage $46.2 $0.0 -$10.4 Commercial Real Estate $137.5 $0.0 -$0.6 Commercial & Industrial - Non-RE $93.0 $0.0 -$0.1 Auto & Consumer $38.6 $0.0 -$0.1 Other -$77.4 $0.0 $0.0 Total -$301.8 $0.0 $9.5

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6 Greg Garrabrants, President and CEO Andy Micheletti, EVP/CFO [email protected] www.axosfinancial.com Johnny Lai, VP Corporate Development and Investor Relations Phone: 858.649.2218 Mobile: 858.245.1442 [email protected] Contact Information

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