Q3 2021 Bm Technologies Inc Earnings Call
[music].
Good day, and thank you for standing by welcome to the B M. T X three Q2021 earnings conference call. At this time all participants are in a listen only mode. After the secrets presentation. There will be a question and answer session to ask a question. During the session you will need to press star one on your telephone if you acquired any.
Further assistance press Star Zero I would now like to hand, the conference over to your speaker today, Bob Ramsay CFO. Thank you. Please go ahead.
Thank you and good morning, everyone and thank you for joining us on <unk> technologies third quarter 2021 earnings webcast. Our earnings release merger announcement and Investor presentation were issued earlier. This morning, and all are posted on the Investor Relations page of the company's website at IR.
BMT X and.
C Dot com or Investor presentation includes important details that we will be walking through on this morning's webcast and I encourage everyone to pull up a copy.
Before we begin I would like to remind you that some of the statements. We make today may be considered forward looking these forward looking statements are subject to a number of risks and uncertainties that may cause actual performance results to differ materially from what is currently anticipated.
Please note that these forward looking statements speak only as of the date of this presentation and we undertake no obligation to update these forward looking statements in light of new information or future events, except to the extent required by applicable securities laws. Please refer to our SEC filings, including our Form 10-K, and 10-Q for a more detailed.
A description of the risk factors that may affect our results copies may be obtained from the SEC or by visiting the Investor Relations section of our website.
This morning, I'm joined by beyond Technology, CEO Loveline subdue.
Chief operating officer, Bob Daigle, and CTO, Jamie Donahue at this time, it's my pleasure to turn the call over to locally.
Thank you Bob Good morning, everyone and thank you for joining <unk> technologies third quarter earnings call.
As Bob said joining us today is also our CFO, Bob <unk> and our CTO, Jimmy Donohue, who are on the line and available during the Q&A section we.
We are thrilled to be sharing with you two great accomplishment. This morning.
<unk> a record Q3 results and the second our exciting strategic merger with first sound Bank.
Before we get started diving into both of these significant update.
Those joining us for the first time I wanted to provide a brief overview of who we are.
BMT access is one of the largest digital banking platforms in the country today with over 2 million accounts.
We are on a mission to make banking better for millions of Americans by providing a more affordable transparent and consumer friendly banking experience.
We were one of the first Neal banking fin techs to go public earlier. This year are one of the first to have a profitable business model and are now among the first fintech embracing a bank charter to create an innovative fintech bank with a sustainable profitable business model into the future.
We pursue a beta the b to B to C and in banking as a service strategy, which allows us to acquire bank customers at low cost and high volume.
We are acquiring customers at less than $10. This provides a tremendous competitive edge for us relative to not only traditional banks, but also to most challenger bank whats youre, having to spend an exorbitant amount to acquire a bank customer.
Today, we are leveraging our b to b to C and banking as a service strategy and three main vertical.
First being higher education vertical where we have relationships with approximately 745 campuses across the country, which allows us to touch one in every three college bound students and introduce them to be in technology and offered to them a choice to open a bank verbal vibe checking account.
Through our partner Bank.
Through this vertical that we disburse $11 billion to $12 billion, a year of which approximately 2 billion flow into bank mobile vibe checking account.
And we are opening several hundred thousand new accounts a year through this channel.
The second vertical is our banking as a service business.
Through our proprietary API driven banking as a service platform and our white label interface, we are able to help fintech and brands launch fully branded financial services products to their customers and to their employees at a fraction of the car and at a fraction of the time it would take them to roll back.
<unk> out on their own.
Our offering provides them with a strong point of differentiation that leads to attracting new customers building greater customer loyalty, adding new revenue streams and accessing data to provide an even more personalized experience to their customers.
Additionally, our technology can also be used by community banks and credit unions to accelerate their digital strategies with state of the art mobile and web based banking App and we can also provide back office banking operations compliance fraud, and risk management and customer service support if needed.
Our banking as a service vertical is best exemplified today by our partnership with T mobile and with the launch of our checking account product T. Mobile money, we continue to expand and significantly grow this relationship.
Lastly, our workplace banking vertical where we distribute the bank mobile suite of banking products to employees across the country as a financial wellness offering we continue to make solid progress in all three of these verticals.
As mentioned, we are a mission driven company first and foremost and are dedicated to our vision of making financial services more accessible and affordable and to financially empower millions of Americans.
From a financial standpoint, our vision continues to be to create a company with a market cap of 500 million to a $1 billion over the next three to five years by executing on the strategy that we've laid out and building upon the strong foundation, we already have.
So, let's get started flipping to slide four.
I am delighted to report to you record results for the third quarter and first nine months of 2021.
We are pleased to report Q3, 2021 EBITDA of $7 million.
Up 91% year over year, and Q3 year to date EBITDA of $20 9 million.
Additionally, given our performance to date, we are excited to raise our 2021 EBITDA guidance to 26 million from $24 million.
Q1 revenues improved 20% year over year with Q3 revenues of $22 million.
Additionally, we continue to add new accounts to our portfolio and added approximately 157000, new accounts in Q3, and approximately 350000, new accounts year to date.
Moving on to slide five.
Here, we graphically show our strong year over year growth in revenue and EBITDA.
Revenue for the first nine months of 2021 totaled $69 3 million a 40% increase from the first nine months of 2020.
Core EBITDA for the first nine months of 2021 totaled $20 9 million and 867% increase from the first nine months of 2020.
Yeah.
On slide six you can see that our average service deposits totaled $1 7 billion in Q3, 2021 mm, 128% increase compared to Q3 2020.
I would like to point out that at the ended the quarter service deposits surpassed $2 billion for the first time.
Specifically average new business service deposits increased 433% compared to Q3, 2020, which is a $940 million increase.
As a reminder, our new business segment includes our banking as a service and workplace banking vertical.
And our student business organic deposit and also as a reminder, these are deposits that are above and beyond any school disbursement.
Increased 17% year over year to $1 7 billion for the nine months ending September 32021, indicating strong primary banking behavior.
Additionally, debit card spend was $773 million in Q3 2021.
<unk>, 4% increase compared to Q3 2020.
Our new business debit spend increased 44% compared to Q3 2020.
Lastly, in the higher education vertical, we disbursed $10 $6 billion to students year to date of which $1 4 billion has been deposited into bank mobile vibe accounts held at our partner Bank.
Moving to slide seven.
We continue to see strong performance in the overall business.
Our revenues per active account increased 31% year over year to $47.
Again this is in an annualized third quarter revenue number.
The strong revenue per account metric is driven by healthy average balances and spend across the portfolio.
Again, we couldn't be more excited about our record financial results and now I will pass it on to our CFO, Bob Ramsay for some additional financial details.
Thank you Leanne I'm going to continue on slide seven.
Everyone can see that the average deposit balances per active account and our new business segment increased an impressive 295% year over year to approximately $10000 per day.
Average balances in the student business increased 23% year over year.
They are over $1800. Similarly on the spend side or new business active accounts quarterly spend increased by 7% year over year to approximately <unk> hundred $50.
And students quarterly spend is even higher at over $800, a 13% year over year increase I want to also highlight that on the new business side of our operations. In addition to the strong overall account metrics that I just shared in the third quarter are highly active users.
Are those defined as having both direct deposit and a minimum of five customer driven transactions per month.
Annualized spend of nearly $1600 on their debit cards and average deposit balances of over 4300, that's very attractive cohort makes up approximately 17% of active accounts compared to 12% in the year ago period.
Moving to slide eight.
Slide eight illustrates several of our Kpis you can see here that the average service deposits increased to 128% year over year to $1 $7 billion and I'll remind everyone that on an ending balance basis, we surpassed $2 billion in deposits for the first time.
Debit card spend increased 4% year over year, our year to date financially refund disbursements increased 17% to $4 1 billion and retention of college and universities remains near 100%.
Turning to slide nine.
Slide nine includes our income statement compared to the year ago period, our revenues increased 20% to $22 million with the strongest growth in our deposit servicing fees fueled by strong growth in service deposits are core operating expenses, including excluding depreciation and amortization.
<unk> increased just 2% to $15 million this quarter, we recognized the benefit from wetzel accurate pricing on a vendor whose contract we renegotiated which did benefit expenses and looking to next quarter, we expect our core opex to be somewhere between the second and third quarter amounts.
Our core expenses, excluding depreciation and amortization from revenues and we earned $7 million in core EBITDA This quarter, which is a 91% increase from $3 7 million in the year ago period.
We also updated our full year EBITDA guidance to $26 million, which implies approximately $5 million in the fourth quarter.
With that I will turn it back over to love lean to walk you through slide 10.
Thanks, Bob.
So on slide 10.
I would now like to provide you with a few key business updates.
In the higher education vertical in addition to the positive trend in account level deposits and spend which I have already covered we continue to see additional positive trends for.
For example, we added 12, new partnerships with colleges and universities across the U S year to date.
Over 71000 additional students now have access to bank mobile disbursement and the bank mobile vibe checking accounts.
Additionally, we've retained almost 100% of our higher education institutions. This year and disbursed 10 $6 billion to students year to date of which $1 4 billion has been deposited into bank mobile by checking accounts.
We also continue to expand our product offering and have signed three new colleges and universities up for our new vendor pay offering which creates more stickiness with the schools, we do business with today.
We also announced in August our plans to serve banks and credit unions looking to expand their digital presence through our proprietary banking as a service technology stack.
We also continue to build out an ecosystem of value added services for our higher education account holders to build greater stickiness and engagement.
Most recently, we entered into a partnership with tutor gig, which employees college students as tutors, providing students additional sources of income and driving customer engagement.
Lastly, I am proud to share the BMT Act and T. Mobile were selected as the best Fintech partnerships as innovate 2021, one of the leading fintech organizations for the innovation, we together have demonstrated through the launching of the T mobile money checking accounts.
Next on slide 11.
Yeah.
Now to talk about the most exciting and impactful update of the quarter.
This morning, we announced the signing of a definitive agreement to merge with first sound Bank, the Seattle, Washington based community Bank.
This is a thrilling milestone for <unk> technology and is a major step forward in executing our vision to create a disruptive Fintech bank.
We are joining the life of a few other innovative fintech in the marketplace that have taken a similar step of combining a fintech with a charter such as square.
Lending club.
And so fine.
Similar to these other Fintech. We believe this is a critical step in order to create a sustainable profitable company with numerous growth opportunities in the future.
We believe there are several strategic and financial benefits to this merger.
First.
We create a fintech bank that combines the best of financial technology, including our proprietary banking as a service offering with all that a bank charter has to offer that's combining both the deposit and asset sides of the balance sheet.
Second we accelerate our earnings power by supplementing fee based income with net interest income.
Third we are now able to offer new products and services over time through the addition of new banking product, which will also help us better attract engage and retain customers and help us fulfill our customer for life strategy.
Fourth this move enables us to become a fintech bank that can support other fintech to come to market similar to what cross River Web Bank Medibank and a few other players are doing today.
Fifth this helps us enhance our customer lifetime value by providing access to lending and other banking products, which we can cross sell to our customers.
Overall, our vision over time is to create a fintech bank that combines the best of banking as a service plus a marketplace lender plus personal investing in Robo Advisory services.
Blockchain based payment system to create an unparalleled customer experience.
Flipping to slide 12, I wanted to highlight a few transaction detail.
BMT actual pay up to $7 22 in cash for each share of FSP or first down bank common stock or approximately $23 million in aggregate consideration.
The combined company to be named BMT ex Bank will be led by me as chair and CEO.
I will also be directly responsible for our digital banking initiatives.
Marty steel the current CEO of first sound bank and a veteran banker will serve as CFO of BMT ex bank and will lead the combined company's community banking Division.
The transaction is subject to regulatory approval and other customary closing conditions and is expected to close in the second half of 2022.
I am sure you will have some questions for us about this merger over the coming months, but in closing.
Really for US we have a competitive edge as we were born within a bank and operated as the bank for six years prior to divesting as an independent Fintech company earlier, this year, which provides us with a huge competitive advantage relative to other fintech, hoping to become bank.
Additionally, we strongly believe our bank is the most profitable way for us to operate our model versus a bank partner model, where we need to share and revenues and have less control over our financial future.
Lastly, we will be a texture than fee based Fintech bank, which we believe will also drive strong valuations based on EBITDA and earnings which should provide compelling returns for our shareholders.
I am thrilled to share with you. This huge step forward in the evolution of our company and believe it will be a trend setting strategic merger that other fintech may fall in.
On slide 13.
Want to quickly highlight some of the tremendous growth opportunities in front of us.
In our student business, we continue to work on expanding the number of college relationships that we have which gives us access to more students who can potentially convert.
Bank account customers.
We are also investing in marketing to drive more bank account adoption and retention.
With regards to existing banking as a service partnerships, we continue to enhance our product offering, but T mobile money and further expand into new channels.
Also continue to work on our pipeline for new partners.
Lastly, we are also open to exploring possible strategic M&A opportunities like the one I shared with you today, where one plus one can equal three or more.
On slide 14, we re iterate that we want to continue expanding our product offering. So we can have the best in class digital banking platform that includes banking lending advice crypto investing and ensuring.
We will keep you posted as we continue to add new products and services over the next six to 18 months.
On slide 15.
I would like to end by summarizing our key investment highlights.
We continue to share record results with core EBITDA up 91% year over year and revenue up 20% year over year we.
We have an established customer base with over 2 million accounts.
We have solid account growth and opened 167000, new accounts in Q3, and 350000 accounts a year to date.
We demonstrate deep customer engagement with an annualized revenue per active account up 31% year over year, driven by higher average balances and spend.
We have strong existing partnerships with approximately 745 University partners and T mobile.
We have developed a proprietary banking as a service platform, which is API, driven and ready to rollout quickly and integrate with partners easily.
We have a very attractive valuation, which today is at a deep discount relative to both private and public peers and lastly.
We couldn't be more thrilled and excited about our growth prospects. Once our merger is complete and we become a true Fintech bank.
Once again I want to thank our investors and shareholders for their continued support and also to all the BMT X team members, whose passion and dedication make all of this possible.
Operator, we would now like to open the line for questions.
At this time, if you would like to ask a question. Please press Star then the number one on your telephone keypad again that is star one.
Well pause for just a moment.
Yeah.
Yeah.
Okay.
Yeah.
Your first question comes from the line of Mike Grondahl with Northland Securities.
Hi, Mike how are you hey level.
I'm, well I'm, well and congrats on a nice quarter Loveline and Bob Hey, My first question.
Looking at the trends in new business.
Maybe especially deposits and to a lesser extent spend can you just help us understand you know.
What's driving that specifically in new business and kind of how you're thinking about it in terms of you know kind of an outlook and what kind of growth do you think you could generate going forward.
Yeah.
Yes, so I'll take that one first Mike. So yes, we have seen really nice growth in the new business, particularly on the deposit side of things. So I think that the industry has got excess liquidity and there are excess deposits out there.
Thank God, we did implement in partnership with our partner earlier this year some changes in the way that accounts qualify for interest as we're trying to really incentivize grew.
Growth in usage of use accounts and I think that what we see as metrics overall, we're really happy with the traction.
And we showed you you know that that is a combination of <unk>.
Strong balances and spend them, we did talk about how about 17%.
The portfolio is what we call active trans actors. They are both direct depositors and doing at least five transactions per month and their annualized spend is at about $16000. So again you know our goal is to have nice strong balances in spend and we are demonstrating both.
Got it and is there.
Do you feel good about projecting similar growth or or how do you just think about that over the next six months to 12 months.
So I think the balances per account can't grow to the moon, but I think that what's going to really be the real driver of growth of new business is account growth and so I think we will continue to see good growth in deposits and spend.
And we will continue to see good growth in spend per account and maybe a little more modest in balances per account, but we do expect to see continued growth overall.
Got it got it.
And then flipping to the merger which gives you.
A lot of capabilities it sounds like it's nicely accretive.
Hmm.
Lovely and if you had to pick two things.
That merger acquisition will help you with what are the two things that stick out the most for you.
Sure.
I think what is you know.
Important to acknowledge is that it will accelerate our earnings power I think everyone sort of understands that our model in banking as a service we'd be able to we were able to create a very low cost high volume acquisition model, but what we essentially provide today, our banking products and services checking savings loans products et cetera.
And that today requires us to work with a partner bank.
And obviously when you work with a partner there is sharing in revenues.
But when you have your own charter.
We're able to create more control over your financials into the future and create more sustainable profitable growth by owning.
That entire revenue.
And so that is what number one we are able to accomplish by creating this.
This merger with first bank.
Secondly, we are really excited because it is very obvious as Racine square lending club's sofa and others very innovative.
Fintech players in the marketplace and Grace the charter that once you have a fintech that that also has a charter with it you were able to add new products New services.
That you are able to attract new customers.
And engage with them better cross sell to them and retain them as well that enhances customer lifetime value over time. So those are two very exciting things that bid.
100% helps us to accelerate and create into the future through this really trendsetting, what we believe strategic merger.
Yeah.
Great. Thank you guys.
Thanks, Mike Thanks, Mike.
Your next question comes from Michael Diana with Maxim Group.
Right.
Alright.
Congratulations.
Bank acquisition.
Our London clubs for example.
I think it's a hugely positive thing for you.
So you can.
You said capture all the economics could could you talk we're talking about.
You mentioned the closing is probably the second half of 2022 I'm sure you're probably building in some conservatism there but are there are there any issues you see in getting approved.
Uh huh.
Sorry, I'll take the Ramsey and then you can follow up.
So yes, we have had preliminary conversations with the regulators there are aware of our objectives and what we are trying to create and so.
We really enjoyed this conversation prior to announcement today, which really puts us in a good path going forward to be in a really great position as we.
Submit our application and go through this process over the coming months.
But we are really excited to be in conversations with the FDIC, who is the current primary regulator for first down bank and as you probably read as well.
There.
Opinion.
Very innovative in their mindset as they think strategically about how banks and Fintech can work together and so we feel privileged to be working with them and conservatively.
We'd like to estimate that at closing in the second half of 2022, but given that we've already started the process with them have had conversations you know.
It could potentially be earlier, but we want to be conservative in our estimates.
Yeah.
Okay, great. Thank you very much.
Thanks, Mike Good morning.
Yeah.
Your next question is from Chris Sakai with singular research.
Good morning, Chris.
Hi, good morning.
I guess the start.
Could you talk a little bit about you know.
Interchange revenue.
It seems like it's been in the downtrend.
Wanted to get your take on why why that is and where you guys see it in the future.
Yes, so I'll take that one.
So no I would not describe interchange revenue has been in a down trend there was a bit of a true up of it did impact this quarter, where we had been a little bit over accrued in recent quarters and we corrected that this quarter, but if you normalize that out you really would see the interchange income trap with debit card spend and we provide this.
Debit card spend is up year over year, there is seasonality, particularly on the student side of the business, but we would expect the card and interchange income to grow.
The year over year basis, again to normalize out the seasonality.
Okay.
And then as we go to your guidance.
Revenues, what's been flat, but EBITDA is growing so so what's going on there.
So I'm not sure what you mean by.
Revenue was flat and EBITDA is growing I mean, as we look at the full year I think we see very good growth in revenues and that's driving the growth in EBITDA, our expenses have been reasonably flat.
And the revenue growth is on what's really been driving.
The EBITDA growth.
Maybe do you want to ask it a different way and maybe I'm not understanding your question.
Oh, okay.
Yeah I was just I was just wondering what was driving the EBITDA growth there.
Yes no.
Our EBITDA growth has come from the top line as it was say in the third quarter and you would see similar trends for the year. We've had third quarter, we had 20% growth in top line revenues and our expenses were roughly flat and if you look at full year, we will have a little bit of expense growth, but it's the growth in revenues, what's driving EBITDA.
Okay.
Great and then any sort of.
Color on the.
No new <unk>.
<unk> with Tudor gigs.
How is that going to.
So the top line.
Yeah. So I think this is a really exciting partnership because it is so aligned with what we do.
Core student business, we're offering our customers the opportunity to a partnership to be tutors and have additional sources of income. So we think this is going to benefit our topline primarily by driving greater engagement with those students of those accounts are going to see more value in the accounts. Additionally.
As they have more income we expect that that income will be deposited into a bank mobile by the count so it should benefit our deposit balances and then spend as they spend that money.
And then there also is a small referral fees so.
Several ways that we see this benefiting us financially, but even more importantly, I think this is a great strategic alignment for us and our customers.
Okay, alright, great well thanks.
Thank you.
Your next question is a follow up from Mike Grondahl with Northland Securities.
Maybe a couple more quick.
Couple more questions.
You know.
On the bank yourselves.
Are you able to provide a range of what the savings will be if you don't have to like rent those services or profit share those services.
With your current partner.
Okay.
Yeah, I don't think we're going to provide specific earnings guidance, but I think the real benefit here is the ability to earn greater revenues by deploying those deposits into assets, where we earned a net interest margin that exceeds the deposit servicing fees. So the first benefit is really.
<unk> to revenues and it will ultimately depend on how quickly we deploy those deposits into loans with the loan mix looks like et cetera, and we're still finalizing as we work through the regulatory process, what exactly that looks like but I think you can look at the banking industry and make some reasonable assumptions around what that.
Improved profitability looks like and then as lovely and I think also referred to this does give us more options and control around additional products and services that we may be able to offer as well. So we will get a broader.
Broader options of what we can offer and then the servicing fee. We expect that the margin will do better than what we would otherwise.
And I would also like to clarify here that you know a traditional bank as net interest income driven we are a fintech bank and for US we have fee based income.
Which is a mixture of interchange our banking as a service software fees et cetera.
Our university fees that are all fee based in nature and reflective of a check driven banking institution and on top of that we get benefit which is supplemented by the net interest income.
Got it got it.
Anything to call out in the workplace banking segment or.
Other wins, if you will I know you've been working on a few.
Okay.
Yeah, we continue to have.
I have a strong pipeline in both workplace banking, we've talked a bit about what that pipeline consists of a mix. It HR brokers at other fintech that focus on employee based benefits.
Direct to employer strategy digital benefits provide.
Providers.
And also our white label pipeline remained strong as we've talked about the score. These take a very long sales cycle, but we have continued to say that we are hopeful that we can be able to share with you a win here fairly soon so we will keep you posted on that.
Great. Thanks, guys.
Thanks, Mike.
At this time there are no additional audio questions.
Okay. We do have some questions that have come in through the webcast. So I will read through some of those as we have a little bit more time.
The first one and locally and I'll direct this to you, but feel free to bounce. It back to me. If you want the first one is what drove the decision to purchase a bank versus partnering with another bank also will you be moving your deposits from your current partner banks for the combined new company when the deal closes.
Sure I'll take that.
So the decision to partner versus.
Go through a merger as we have done it with very simple. So we have a partner relationship today, we've talked to you about having to potentially continue in a partner bank relationship into the future and as I explained in our prepared remark.
We believe that a partner bank relationship is less accretive to us because we have to share in the revenue with a partner bank now if you merge and you become a fintech that happens to have a charter those economics remain with you and you had the opportunity over time to actually.
Banned the economics.
Since you now have the deposit side of the balance sheet as well as the asset side of the balance sheet. So to that is to answer number one and I believe number two is will you be moving over the deposits. Yes over time, we will thoughtfully be moving over the deposits onto the balance sheet, which we would then deploy.
Hi.
Into loans.
And that we will.
The timing and the size of that move is still.
It's still being decided and we will keep you guys posted on.
That overall timing.
But we do continue to believe.
That this will be significantly accretive on our revenues and EBITDA on an earnings basis over the next one to three years and we are very excited and confident to be able to share that.
Thanks Jose.
Take another question here ask if.
Given the acquisition will be empty at TX continue to look for banking partners now that its acquiring a bank I'll take it down and when I think that becoming a bank ourselves negates the need for banking partners and so the goal is as low Leno said overtime to bring deposits onto our balance sheet.
Other than work through additional partners.
Another question here.
Will the acquisition result in any changes to the terms of the existing warrants I'll take that one as well.
The warrant agreements as they are written does how provisions for this sort of scenario, but effectively there are no changes in the warrants or the way that they would work based simply would end up becoming warrants and the new security whether than in the current tech.
Technology stock.
Yes.
We have a another question here that talks about the process for bringing in deposits over and capital levels at the bank I think we've said a few times that deposits will migrate over over time, and we're working through that plan and with regulators, we do intend to support.
The balance sheet and those deposits with appropriate levels of capital we want to have strong capital ratios for an institution that is a tech driven bank that has good growth and we will walk through what those ratios look like as we finalized plans with our regulators.
Let's see.
A question here locally and I'll, let you take that talks about some of the new opportunities for new products and it says as we think about things like crypto and investing as pillars of development are these opportunities we will explore through partnerships or develop an in house solution.
Yeah, I think that we've mentioned this on previous calls number one is our digital banking platform and continuing to build it out with products and services that are most compelling to consumers is at highest priority to us.
We'll take our build.
By in our partner mix of strategic moves to be able to accomplish this.
And so for example, we did talk about a partnership move to help us build out the credit monitoring and credit building through a partnership with array that we announced in the previous quarter. So that's an example of a partnership.
And I you know example of a merger is what we announced today to help build out and continue to enhance our banking products and our lending products for example.
And so it's really going to be a mix between build.
My partner as we continue to build out the digital banking platform, which is a strong and high priority for us.
Great. Thank you lovely.
Couple more questions here, we have a question asking how many schools are adopted the vendor pay solution. We're happy that we signed our first three institutions. This quarter. So we are sort of out of the gates, which was great.
A question here about the company name and can be MTX go back to the named Bank mobile with the deal if it chooses.
I would remind everyone that the bank Mobil brands still does exist in our higher education business, we are able to use that with our current partner bank and so the bank mobile Vibe account does still exist as we look forward with the transaction. The plan right now is the name the company BMT ex bank.
That doesn't mean that we wouldn't use the bank mobile brand and the student banking.
And I would just add to that the reason you know BMT ex bank is reflective of really the DNA of what we are trying to create here.
And which not just that we're trying to create but in essence, what it is it is a tech driven fintech first bank and so having our routes and our technology and making sure that we continue to be technology first in everything that we do is that you.
Greatest priority for us and B M. T X helps us continue to reflect that in our name.
Great. Thank you.
Maybe one more ramzi.
Yeah, one more.
There's a question here around for sound and well update you more one asks the first sound does have any branches. They do have one branch and we will continue to maintain that one branch and then there's a question here about what do we plan to invest the deposits Ed on the asset side of the balance sheet.
And I.
And I guess to answer that I'll take that we are looking to have a diversified balance sheet, one that we feel safe and comfortable about we certainly will have an element of securities on the balance sheet, which would have very low credit risk and would help support liquidity. Additionally, <unk> has got a really great community commercial lending.
Asian, and we believe that there is opportunity to grow that business, where they are as they become part of a larger institution with better capital and we also we will be exploring the opportunity to expand or extend credit to our existing consumer customers, which we have talked about as being a part of our roadmap in the past.
And we'll look at other ways to supplement and augment the asset strategy. So we're still finalizing but there are a lot of things that we're looking at and we ultimately are striving to generate a diversified asset strategy.
Anything you would add on that lovely.
Nope that sounds good.
Okay I think that's all we have time for.
Great. Thank you everyone again for your continued support we were so thrilled to be able to share.
Strong quarter results as well as we are so excited to be working with Marty and the rest of his team at first sound bank to really create a fintech bank of the future. So thank you so much and look forward to speaking to you next quarter.
Thank you everyone.
Thank you. This concludes today's conference call you may now disconnect speakers hold the line.