CASH 2018 Annual Report

27 The variety of deposit accounts offered by the Company has allowed it to be competitive in obtaining funds and to respond with flexibility to changes in consumer demand. The Company endeavors to manage the pricing of its deposits in keeping with its asset/liability management and profitability objectives. Based on its experience, the Company believes that its savings, money market accounts, NOW, regular checking accounts and deposits related to prepaid cards are relatively stable sources of deposits. However, the ability of the Company to attract and maintain certificates of deposit and the rates paid on these deposits has been and will continue to be significantly affected by market conditions. At September 30, 2018, $2.41 billion of the Company’s $4.43 billion deposit portfolio was attributable to the Payments segment. The majority of these deposits represent funds available to spend on prepaid debit cards and other stored value products, of which $2.33 billion are included with non-interest-bearing checking accounts and $81.6 million are included with interest-bearing checking and savings deposits on the Company’s Consolidated Statements of Financial Condition. Generally, these deposits do not pay interest. The Payments segment originates debit card programs through outside sales agents and other financial institutions. As such, these deposits carry a somewhat higher degree of concentration risk than traditional consumer products. If a major client or card program were to leave the Bank, deposit outflows could be more significant than if the Bank were to lose a more traditional customer, although it is considered unlikely that all deposits related to a program would leave the Bank without significant advance notification. As such, and as historical results indicate, the Company believes that its deposit portfolio attributable to the Payments segment is stable. The increase in deposits arising from Payments has allowed the Bank to reduce its reliance on certificates of deposits and public funds, which typically have relatively higher costs. See “Regulation - FDIC Deposit Classification Guidance.” The following table sets forth the deposit flows at the Company during the periods indicated. September 30, 2018 2017 2016 (Dollars in Thousands) Opening Balance $ 3,223,424 $ 2,430,082 $ 1,657,534 Acquired 1,120,666 — — Deposits 418,034,951 418,732,743 418,950,277 Withdrawals (417,955,022) (417,941,472) (418,178,086) Interest Credited 6,968 2,071 357 Ending Balance $ 4,430,987 $ 3,223,424 $ 2,430,082 Net Increase $ 1,207,563 $ 793,342 $ 772,548 Percent Increase 37.46% 32.65% 46.61%