The Bancorp, Inc. Reports Third Quarter 2025 Financial Results

WILMINGTON, Del.--( BUSINESS WIRE)--The Bancorp, Inc. (“The Bancorp” or the “Company” or “we” or “our”) (NASDAQ: TBBK), a financial holding company, today reported its financial results for the third quarter of 2025.

Highlights

“We had another successful quarter as we continue to build new Fintech capabilities and implement and expand partner programs,” said Damian Kozlowski, CEO of The Bancorp. He also noted that “We are lowering guidance from $5.25 to $5.10 earnings per share for 2025, primarily due to lower projected balances for our traditional lending businesses and an increased credit provision for leasing as a result of losses on the disposition of previously identified credits in trucking. In addition, we are not giving specific guidance for 2026 other than we are targeting a minimum $7 earnings per share run-rate by the fourth quarter of 2026. We are initiating preliminary guidance for 2027 of $8.25 earnings per share. We believe that our three major Fintech initiatives of credit sponsorship expansion, embedded finance platform development and new program implementations, plus platform efficiency and productivity gains from platform restructuring and new AI tools, and a continued high level of capital return through share buybacks, will contribute to earnings per share accretion. Earnings per share gains are subject to uncertainty, particularly as it relates to the development and implementation timelines in Fintech, and our stock price for buybacks.”

Conference Call Webcast

You may access the LIVE webcast of The Bancorp’s Quarterly Earnings Conference Call at 8:00 AM ET Friday, October 31, 2025, by clicking on the webcast link on The Bancorp’s homepage at www.thebancorp.com or you may dial 1.800.549.8228, conference ID 37073. You may listen to the replay of the webcast following the live call on The Bancorp’s investor relations website (archived for one year) or telephonically until Friday, November 7, 2025, by dialing 1.888.660.6264, playback code 37073#.

About The Bancorp

The Bancorp, Inc. (NASDAQ: TBBK), headquartered in Wilmington, Delaware, through its subsidiary, The Bancorp Bank, N.A, provides a variety of services including providing non-bank financial companies with the people, processes, and technology to meet their unique banking needs. Through its Fintech Solutions, Institutional Banking, Commercial Lending, and Real Estate Bridge Lending businesses, The Bancorp provides partner-focused solutions paired with cutting-edge technology for companies that range from entrepreneurial startups to Fortune 500 companies. With over 20 years of experience, The Bancorp has become a leader in the financial services industry, earning recognition as the #1 issuer of prepaid cards in the U.S., a nationwide provider of bridge financing for real estate capital improvement plans, an SBA National Preferred Lender, a leading provider of securities-backed lines of credit, with one of the few bank-owned commercial vehicle leasing groups. By its company-wide commitment to excellence, The Bancorp has also been ranked as one of the 100 Fastest-Growing Companies by Fortune, a Top 50 Employer by Equal Opportunity Magazine and was selected to be included in the S&P Small Cap 600. For more about The Bancorp, visit https://thebancorp.com/.

Forward-Looking Statements

Statements in this earnings release regarding The Bancorp’s business that are not historical facts, are “forward-looking statements.” These statements may be identified by the use of forward-looking terminology, including, but not limited to the words “intend,” “may,” “believe,” “will,” “expect,” “look,” “anticipate,” “plan,” “estimate,” “continue,” or similar words. Forward-looking statements include, but are not limited to, statements regarding our anticipated 2025, 2026 and 2027 results, including earnings per share accretion, future growth, productivity and efficiency, the expansion, expected timelines and implementation of our Fintech initiatives, the possible benefits of our platform restructuring and adoption of AI tools, and share repurchases. Such forward-looking statements relate to our current assumptions, projections and expectations about our business and future events, including current expectations about important economic and political factors, among other factors, and are subject to risks and uncertainties, which could cause the actual results, events or achievements to differ materially from those set forth in or implied by the forward-looking statements and related assumptions. Factors that could cause results to differ from those expressed in the forward-looking statements also include, but are not limited to the risks and uncertainties referenced or described in The Bancorp’s filings with the Securities and Exchange Commission, including the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s Annual Report on Form 10-K/A, as amended, for the fiscal year ended December 31, 2024 and other documents that the Company files from time to time with the Securities and Exchange Commission. The forward-looking statements speak only as of the date of this press release. The Bancorp does not undertake any duty to publicly revise or update forward-looking statements in this press release to reflect events or circumstances that arise after the date of this press release, except as may be required under applicable law.

The Bancorp, Inc.

Financial highlights

(unaudited)

Three months ended

Nine months ended

September 30,

Condensed Consolidated Income Statements

2025

2024

2025

2024

(Dollars in thousands, except per share and share data)

Net interest income

94,197

93,732

283,432

281,945

Provision for credit losses on non-consumer fintech loans

5,755

3,476

8,123

7,316

Provision for credit losses on consumer fintech loans

39,790

—

128,891

—

Provision (reversal) for unfunded commitments

(491)

(744)

(340)

Non-interest income

Fintech fees

ACH, card and other payment processing fees

5,077

3,892

15,771

9,856

Prepaid, debit card and related fees

25,513

23,907

77,340

72,948

Consumer credit fintech fees

4,493

1,600

12,063

1,740

Total fintech fees

35,083

29,399

105,174

84,544

Net realized and unrealized gains on commercial

loans, at fair value

1,005

606

1,710

2,205

Leasing related income

1,397

1,072

5,500

2,889

Consumer fintech loan credit enhancement

39,790

—

128,891

—

Other non-interest income (1)

3,141

1,031

6,526

2,574

Total non-interest income

80,416

32,108

247,801

92,212

Non-interest expense

Salaries and employee benefits

37,350

33,821

108,153

97,964

Data processing expense

1,259

1,408

3,691

4,252

Legal expense

1,483

1,055

5,303

2,509

FDIC insurance

905

904

3,160

2,618

Software

5,040

4,561

15,197

13,687

Other non-interest expense

10,367

11,506

31,417

30,383

Total non-interest expense

56,404

53,255

166,921

151,413

Income before income taxes

73,155

69,030

228,042

215,768

Income tax expense

18,228

17,513

56,121

54,136

Net income

54,927

51,517

171,921

161,632

Net income per share - basic

1.20

1.06

3.69

3.18

Net income per share - diluted

1.18

1.04

3.64

3.15

Weighted average shares - basic

45,865,172

48,759,369

46,554,311

50,807,021

Weighted average shares - diluted

46,518,125

49,478,236

47,209,469

51,361,104

(1) For the three and nine months ended September 30, 2025, includes $2.3 million of income from the release of an earnest money deposit related to the termination of an agreement of sale for a $43.0 million other real estate owned apartment complex property.

Condensed Consolidated Balance Sheets

September 30,

June 30,

December 31,

September 30,

2025 (unaudited)

2024

2024 (unaudited)

(Dollars in thousands, except share data)

Assets:

Cash and cash equivalents

Cash and due from banks

10,162

11,637

6,064

8,660

Interest earning deposits at Federal Reserve Bank

74,517

328,628

564,059

47,105

Total cash and cash equivalents

84,679

340,265

570,123

55,765

Investment securities, available-for-sale, at fair value, net of $10.0 million allowance for credit loss as of September 30, 2024, and $0 for all other periods presented

1,384,256

1,481,500

1,502,860

1,588,289

Commercial loans, at fair value

142,658

185,476

223,115

252,004

Loans, net of deferred fees and costs

6,672,637

6,535,432

6,113,628

5,906,616

Allowance for credit losses

(64,152)

(59,393)

(44,853)

(31,004)

Loans, net

6,608,485

6,476,039

6,068,775

5,875,612

Federal Home Loan Bank, Atlantic Central Bankers Bank, and Federal Reserve Bank stock

25,250

16,250

15,642

21,717

Premises and equipment, net

25,947

26,495

27,566

28,091

Accrued interest receivable

43,831

40,607

41,713

42,915

Intangible assets, net

955

1,055

1,254

1,353

Other real estate owned

61,974

66,054

62,025

61,739

Deferred tax asset, net

10,034

12,436

18,874

9,604

Credit enhancement asset

29,318

26,982

12,909

—

Other assets

182,037

166,072

182,687

157,501

Total assets

8,599,424

8,839,231

8,727,543

8,094,590

Liabilities:

Deposits

Demand and interest checking

7,254,896

7,705,813

7,434,212

6,844,128

Savings and money market

75,901

60,122

311,834

81,624

Total deposits

7,330,797

7,765,935

7,746,046

6,925,752

Short-term borrowings

200,000

—

135,000

Senior debt

196,052

96,391

96,214

96,125

Subordinated debenture

13,401

Other long-term borrowings

13,806

13,898

14,081

38,157

Other liabilities

67,206

89,340

68,018

70,829

Total liabilities

7,821,262

7,978,965

7,937,760

7,279,264

Shareholders' equity:

Common stock - authorized, 75,000,000 shares of $1.00 par value (1)

48,404

48,104

47,713

48,231

Additional paid-in capital

19,400

12,608

3,233

26,573

Retained earnings

951,076

896,149

779,155

723,247

Accumulated other comprehensive income (loss)

8,814

1,609

(17,637)

17,275

Treasury stock at cost (2)

(249,532)

(98,204)

(22,681)

—

Total shareholders' equity

778,162

860,266

789,783

815,326

Total liabilities and shareholders' equity

8,599,424

8,839,231

8,727,543

8,094,590

September 30,

June 30,

December 31,

September 30,

2025 (unaudited)

2024

2024 (unaudited)

(1)Common stock

Shares issued

48,404,006

48,104,006

47,713,481

48,230,334

Shares outstanding

44,528,879

46,262,932

47,310,750

48,230,334

(2)Treasury stock

3,875,127

1,841,074

402,731

—

Average balance sheet and net interest income

Three months ended September 30, 2025

Three months ended September 30, 2024

(Dollars in thousands; unaudited)

Average

Assets:

Balance

Interest

Rate

Balance

Interest

Rate

Interest earning assets:

Loans, net of deferred fees and costs (1)

6,681,717

114,841

6.87%

6,017,911

116,367

7.73%

Leases-bank qualified (2)

7,579

179

9.45%

5,151

146

11.34%

Investment securities-taxable

1,418,058

17,354

4.90%

1,575,091

19,767

5.02%

Investment securities-nontaxable (2)

8,385

131

6.25%

2,927

7.52%

Interest earning deposits at Federal Reserve Bank

354,991

3,954

4.46%

247,344

3,387

5.48%

Net interest earning assets

8,470,730

136,459

6.44%

7,848,424

139,722

7.12%

Allowance for credit losses

(59,166)

(28,254)

Other assets

308,654

222,646

8,720,218

8,042,816

Liabilities and Shareholders' Equity:

Deposits:

Demand and interest checking

7,560,744

38,233

2.02%

6,942,029

42,149

2.43%

Savings and money market

64,529

563

3.49%

65,079

549

3.37%

Total deposits

7,625,273

38,796

2.04%

7,007,108

42,698

2.44%

Short-term borrowings

45,067

495

4.39%

73,480

1,030

5.61%

Long-term borrowings

13,866

197

5.68%

38,235

689

7.21%

Subordinated debentures

13,401

259

7.73%

13,401

297

8.87%

Senior debt

140,992

2,450

6.95%

96,071

1,234

5.14%

Total deposits and liabilities

7,838,599

42,197

2.15%

7,228,295

45,948

2.54%

Other liabilities

62,405

18,362

Total liabilities

7,901,004

7,246,657

Shareholders' equity

819,214

796,159

8,720,218

8,042,816

Net interest income on tax equivalent basis (2)

94,262

93,774

Tax equivalent adjustment

Net interest income

94,197

93,732

Net interest margin (2)

4.45%

4.78%

(1) Includes commercial loans, at fair value. All periods include non-accrual loans.

(2) Full taxable equivalent basis, using 21% respective statutory federal tax rates in 2025 and 2024.

Average balance sheet and net interest income

Nine months ended September 30, 2025

Nine months ended September 30, 2024

(Dollars in thousands; unaudited)

Average

Assets:

Balance

Interest

Rate

Balance

Interest

Rate

Interest earning assets:

Loans, net of deferred fees and costs (1)

6,542,172

335,831

6.84%

5,828,938

345,497

7.90%

Leases-bank qualified (2)

7,058

492

9.29%

4,840

379

10.44%

Investment securities-taxable (3)

1,456,402

57,874

5.30%

1,255,532

46,921

4.98%

Investment securities-nontaxable (2)

7,683

367

6.37%

2,905

155

7.11%

Interest earning deposits at Federal Reserve Bank

746,470

24,960

4.46%

486,883

19,948

5.46%

Net interest earning assets

8,759,785

419,524

6.39%

7,579,098

412,900

7.26%

Allowance for credit losses

(52,227)

(27,993)

Other assets

341,661

280,733

9,049,219

7,831,838

Liabilities and Shareholders' Equity:

Deposits:

Demand and interest checking

7,906,597

126,680

2.14%

6,684,671

120,405

2.40%

Savings and money market

88,687

2,454

3.69%

58,777

1,453

3.30%

Total deposits

7,995,284

129,134

2.15%

6,743,448

121,858

2.41%

Short-term borrowings

15,334

500

4.35%

55,820

2,344

5.60%

Repurchase agreements

—

Long-term borrowings

13,957

590

5.64%

38,371

2,060

7.16%

Subordinated debentures

13,401

771

7.67%

13,401

880

8.76%

Senior debt

111,354

4,917

5.89%

95,983

3,701

5.14%

Total deposits and liabilities

8,149,330

135,912

2.22%

6,947,027

130,843

2.51%

Other liabilities

115,916

73,507

Total liabilities

8,265,246

7,020,534

Shareholders' equity

783,973

811,304

9,049,219

7,831,838

Net interest income on tax equivalent basis (2)

283,612

282,057

Tax equivalent adjustment

180

112

Net interest income

283,432

281,945

Net interest margin (2)

4.32%

4.96%

(1) Includes commercial loans, at fair value. All periods include non-accrual loans.

(2) Full taxable equivalent basis, using 21% respective statutory federal tax rates in 2025 and 2024.

(3) The nine months ended September 30, 2025 includes $3.0 million of interest income from a security that was known as “CRE-2” and which relates to the Company’s discontinued commercial real estate securitization business. The CRE-2 interest was repaid in the second quarter of 2025 as a result of the final sale of underlying collateral related to that security. CRE-2 was the last security remaining related to the Company’s discontinued commercial real estate securitization business.

Capital ratios

Tier 1 capital

Total capital

Common equity

to average

to risk-weighted

Tier 1 to risk

assets ratio

weighted assets

As of September 30, 2025

The Bancorp, Inc.

8.74%

12.99%

14.09%

12.99%

The Bancorp Bank, National Association

9.85%

14.66%

15.77%

14.66%

"Well capitalized" institution (under federal regulations-Basel III)

5.00%

8.00%

10.00%

6.50%

As of December 31, 2024

The Bancorp, Inc.

9.41%

13.85%

14.65%

13.85%

The Bancorp Bank, National Association

10.38%

15.25%

16.06%

15.25%

"Well capitalized" institution (under federal regulations-Basel III)

5.00%

8.00%

10.00%

6.50%

Three months ended

Nine months ended

September 30,

2025

2024

2025

2024

Selected operating ratios

Return on average assets (1)

2.50%

2.55%

2.54%

2.76%

Return on average equity (1)

26.60%

25.74%

29.32%

26.61%

Net interest margin

4.45%

4.78%

4.32%

4.96%

(1) Annualized.

Book value per share table

September 30,

June 30,

December 31,

September 30,

2025

2024

Book value per share

17.48

18.60

16.69

16.90

Gross dollar volume (“GDV”) (1)

Three months ended

September 30,

June 30,

December 31,

September 30,

2025

2024

(Dollars in thousands)

Prepaid and debit card GDV

44,037,511

43,649,005

39,656,909

37,898,006

(1) Gross dollar volume represents the total dollar amount spent on prepaid, debit and credit cards issued by The Bancorp Bank, N.A.

Business line quarterly summary:

Quarter ended September 30, 2025

(Dollars in millions)

Balances

% Growth

Major business lines

Average approximate

rates (1)

Total loan

portfolio (2)

Year over

Year

Linked quarter

annualized

Loans

Institutional banking (3)

6.5%

1,895

Small business lending (4)

7.6%

1,059

12%

Direct lease financing

8.1%

693

(3%)

Real estate bridge loans (non-SBA) - recorded at fair value

6.6%

Real estate bridge loans - recorded at amortized cost

8.5%

2,132

(3%)

(1%)

Consumer fintech loans - interest bearing

5.1%

105

Consumer fintech loans - non-interest bearing (5)

—

680

Other loans (6)

5.9%

164

(14%)

Unamortized loan fees and costs

—

Weighted average yield

6.8%

6,815

Non-interest income: Fintech

fees

% Growth

Deposits: Fintech solutions group

Current

quarter

Year over Year

Fintech deposits and fees

2.1%

7,342

10%

35.1

19%

(1) Average rates are for the three months ended September 30, 2025.

(2) Loan and deposit categories are based on period-end and average quarterly balances, respectively. Total loan portfolio includes both loans recorded at amortized cost and loans at fair value.

(3) Institutional Banking loans are comprised of securities-backed lines of credit (“SBLOC’) loans collateralized by marketable securities, insurance-backed lines of credit (“IBLOC”) loans collateralized by the cash surrender value of eligible life insurance policies, and investment advisor financing.

(4) Small Business Lending (“SBL”) is substantially comprised of Small Business Administration (“SBA”)-guaranteed loans and includes SBL loans at fair value. Growth rates exclude the impact of $4 million of loans that do not qualify for true sale accounting at September 30, 2025 compared to $4 million at prior quarter end and $28 million at September 30, 2024.

(5) Income related to non-interest-bearing balances is included in non-interest income.

(6) Includes warehouse financing related to loan sales to third-party purchasers of $122.5 million.

Summary of credit lines available

The Bancorp Bank, N.A. maintains lines of credit exceeding potential liquidity requirements as follows. The Bancorp also has access to other substantial sources of liquidity.

September 30, 2025

(Dollars in thousands)

Federal Reserve Bank

2,064,218

Federal Home Loan Bank

912,186

Total lines of credit capacity

2,976,404

Current balance – Short-term borrowings

200,000

Available capacity

2,776,404

Estimated insured vs. uninsured deposits

The vast majority of The Bancorp Bank, N.A.’s deposits are low balance, insured deposits, and accordingly do not constitute the liquidity risk experienced by certain institutions. The deposit base is comprised as follows:

September 30, 2025

Insured

92%

Low balance accounts (1)

Other uninsured

Total deposits

100%

(1) Comprised of small balances, such as anonymous gift cards and corporate incentive cards for which there is no identified depositor.

Loan Portfolio

September 30,

June 30,

December 31,

September 30,

2025 (unaudited)

2024

2024 (unaudited)

(Dollars in thousands)

SBL non-real estate

222,933

204,087

190,322

179,915

SBL commercial mortgage

729,620

723,754

662,091

665,608

SBL construction

34,518

30,705

34,685

30,158

Small business loans

987,071

958,546

887,098

875,681

Direct lease financing

693,322

698,086

700,553

711,836

SBLOC / IBLOC (1)

1,609,047

1,601,405

1,564,018

1,543,215

Advisor financing

285,531

272,155

273,896

248,422

Real estate bridge loans

2,131,689

2,140,039

2,109,041

2,189,761

Consumer fintech (2)

785,045

680,487

454,357

280,092

Other loans

164,487

169,945

111,328

46,586

6,656,192

6,520,663

6,100,291

5,895,593

Unamortized loan fees and costs

16,445

14,769

13,337

11,023

Total loans, including unamortized fees and costs

6,672,637

6,535,432

6,113,628

5,906,616

(1) SBLOC loans are collateralized by marketable securities, while IBLOC are collateralized by the cash surrender value of insurance policies. At September 30, 2025 and December 31, 2024, IBLOC loans amounted to $471.6 million and $548.1 million, respectively.

(2) At September 30, 2025, consumer fintech loans consisted of $416.0 million of secured credit card loans, with the balance comprised of other short-term extensions of credit.

The Bancorp Bank, N.A. emphasizes safety and soundness, and its balance sheet has a risk profile enhanced by the special nature of the collateral supporting its loan niches, related underwriting, and the characteristics of its funding sources, including those highlighted in the bullets below. Those loan niches and funding sources have contributed to increased earnings levels, even during periods in which markets have experienced various economic stresses.

At September 30, 2025, consumer fintech loans included $416.0 million of secured credit card accounts, which are backed dollar for dollar by cash collateral by each individual cardholder and are required to be repaid in-full monthly. The remaining consumer fintech loans consist of cashflow underwritten short-term liquidity products to individual borrowers ranging in maturities from 30 to 365 days, with The Bancorp Bank, N.A.’s partner(s) providing a full guarantee against losses. The Bancorp Bank, N.A. maintains cash collateral for the expected losses on dollars already lent, as well as right of offset against other revenues generated through those relationships.

The REBL portfolio is largely comprised of rehabilitation bridge loans for apartment buildings. The Company has minimal exposure to non-multifamily commercial real estate such as office buildings. These loans generally have three-year terms with two one-year extension options to allow for the rehabilitation work to be completed and rentals stabilized for an extended period, before being refinanced at lower rates through U.S. Government Sponsored Entities or other lenders.

The REBL portfolio consists primarily of workforce housing, which we consider to be working class apartments at more affordable rental rates. Related collateral values should accordingly be more stable than higher rent properties, even in stressed economies. While the macro-economic environment has challenged the multifamily bridge space, the stability of the Company’s REBL portfolio is evidenced by the estimated values of the underlying collateral. The Company’s $2.13 billion REBL portfolio at September 30, 2025 has a weighted average origination date “as is” loan-to-value ratio of 70%, based on third-party appraisals. Further, the weighted average origination date “as stabilized” loan-to-value ratio (“LTV”), which measures the estimated value of the apartments after the rehabilitation is complete, may provide even greater protection.

As part of the underwriting process, The Bancorp Bank, N.A. reviews prospective borrowers’ previous rehabilitation experience in addition to overall financial wherewithal. These transactions also include significant borrower equity contributions with required performance metrics. Underwriting generally includes, but is not limited to, assessment of local market information relating to vacancy and rental rates, review of post rehabilitation rental rate assumptions against geo-specific affordability indices, negative news searches, lien searches, visitations by bank personnel and/or designated engineers, and other information sources. Rehabilitation progress is monitored through ongoing draw requests and financial reporting covenants. This generally allows for early identification of potential issues and expedited action to address on a timely basis.

Operations and ongoing loan evaluation are overseen by multiple levels of management in addition to the REBL team’s experienced professional staff and third-party consultants utilized during the underwriting and asset management process. This oversight includes a separate loan committee specific to REBL, which is comprised of seasoned and experienced lending professionals who do not directly report to anyone on the REBL team. There is also a separate loan review department, a surveillance committee and additional staff which evaluate potential losses under the current expected credit losses methodology, all of which similarly do not report to anyone on the REBL team.

The SBLOC and IBLOC portfolios are respectively secured by marketable securities and the cash value of life insurance. The majority of SBA 7(a) loans are government guaranteed, while SBA 504 loans are made with 50%-60% LTVs.

Additional details regarding our loan portfolios are included in the following sections of this press release. This press release also discloses in this press release is the summarization of the earnings contributions of our payments businesses, which further enhances The Bancorp’s risk profile. The Company’s risk profile inherent in its loan portfolios, funding, and earnings levels, may present opportunities to further increase stockholder value, while still prudently maintaining capital levels.

Small Business Lending

Small business loans as of September 30, 2025

Loan principal

(Dollars in millions)

Commercial mortgage SBA (1)

378

Construction SBA (2)

Non-guaranteed portion of U.S. government guaranteed 7(a) Program loans (3)

121

Non-SBA SBLs

128

Subtotal - SBL loans, excluding guaranteed portion and Other

648

U.S. government guaranteed portion of SBA loans (4)

407

Other (5)

Total SBL principal

1,059

SBL, at amortized cost

987

SBL, included in loans, at fair value (6)

Total SBL principal

1,059

(1) Substantially all these loans are made under the 504 Program, which dictates origination date LTV percentages, generally 50%-60%, to which The Bancorp Bank, N.A. adheres.

(2) Includes $15 million in 504 Program first mortgages with an origination date LTV of 50%-60%, and $6 million in SBA interim loans with an approved SBA post-construction full takeout/payoff.

(3) Includes the unguaranteed portion of 7(a) Program loans which are 70% or more guaranteed by the U.S. government. SBA 7(a) Program loans are not made on the basis of real estate LTV; however, they are subject to SBA's "All Available Collateral" rule which mandates that to the extent a borrower or its 20% or greater principals have available collateral (including personal residences), the borrower must pledge that available collateral to fully collateralize the loan, after applying SBA-determined liquidation rates. In addition, all 7(a) Program loans and 504 Program loans require the personal guaranty of all 20% or greater owners.

(4) Includes the portion of SBA 7(a) Program loans which have been guaranteed by the U.S. government, and therefore are assumed to have no credit risk.

(5) Comprised of $4 million of loans sold that do not qualify for true sale accounting.

(6) The SBLs held at fair value are comprised of the government guaranteed portion of 7(a) Program loans at the dates indicated.

Small business loans by type as of September 30, 2025

(Excludes government guaranteed portion of SBA 7(a) Program and Other loans)

SBL commercial

mortgage (1)

SBL construction (1)

SBL non-real estate

Total

% Total

(Dollars in millions)

Funeral homes and funeral services

—

13%

Hotels (except casino hotels) and motels

—

13%

Full-service restaurants

Child day care services

—

Car washes

—

Homes for the elderly

—

Gasoline stations with convenience stores

—

Outpatient mental health and substance abuse centers

—

General line grocery merchant wholesalers

—

Plumbing, heating, and air-conditioning companies

—

Fitness and recreational sports centers

—

Caterers

—

Offices of lawyers

—

Limited-service restaurants

—

All other specialty trade contractors

—

Used car dealers

—

Charter bus industry

—

Lessors of nonresidential buildings

—

General warehousing and storage

—

Automotive body, paint, and interior repair

—

Nursing care facilities

—

Appliance repair and maintenance

—

Residential remodelers

—

Offices of dentists

—

Other (2)

179

221

34%

Total

537

648

100%

(1) Of the SBL commercial mortgage and SBL construction loans, $162 million represents the total of the non-guaranteed portion of SBA 7(a) Program loans and non-SBA loans. The balance of those categories represents SBA 504 Program loans with 50%-60% origination date LTVs. SBL Commercial excludes $4 million of loans sold that do not qualify for true sale accounting.

(2) Loan types of less than $5 million are spread over approximately one hundred different business types.

SBL State diversification as of September 30, 2025

(Excludes government guaranteed portion of SBA 7(a) Program loans and Other loans)

SBL commercial

mortgage (1)

SBL construction (1)

SBL non-real estate

Total

% Total

(Dollars in millions)

California

142

158

24%

Florida

15%

North Carolina

—

New York

—

Texas

New Jersey

—

Georgia

Pennsylvania

—

Maine

—

Other states

100

125

21%

Total

537

648

100%

Top 10 SBL loans as of September 30, 2025

(Excludes government guaranteed portion of SBA 7(a) Program loans and Other loans)

Type

State

Balance

(Dollars in millions)

General line grocery merchant wholesalers

Funeral homes and funeral services

Outpatient mental health and substance abuse center

Hotel

Funeral homes and funeral services

Lawyer's office

Hotel

Charter bus industry

Total

Commercial Real Estate Bridge Lending

Commercial real estate bridge lending, excluding SBA loans, are as follows:

Type as of September 30, 2025

Type

# Loans

Balance

Weighted average

origination date

LTV

Weighted average

interest rate

(Dollars in millions)

Real estate bridge loans (multifamily apartment loans recorded at amortized cost) (1)

178

2,132

70%

8.48%

Real estate bridge loans (non-SBA), at fair value

66%

6.60%

Total commercial real estate loans

183

2,203

70%

8.42%

(1) In the third quarter of 2021, we resumed the origination of bridge loans for multi-family apartment rehabilitation which comprise these categories. Such loans held at fair value were originally intended for sale but are now being retained on the balance sheet. In addition to “as is” origination date appraisals, on which the weighted average origination date LTVs are based, third-party appraisers also estimated “as stabilized” values, which represents additional potential collateral value as rehabilitation progresses, and units are re-leased at stabilized rental rates. The weighted average origination date “as stabilized” LTV was estimated at 60%.

State diversification as of September 30, 2025

15 largest loans as of September 30, 2025

State

Balance

Origination

date LTV

State

Balance

Origination

date LTV

(Dollars in millions)

Texas

618

71%

Texas

75%

Georgia

317

70%

Texas

64%

Florida

233

68%

Michigan

62%

New Jersey

138

69%

New Jersey

62%

Indiana

137

71%

Florida

72%

Ohio

120

71%

Pennsylvania

63%

Michigan

64%

Indiana

76%

Other states each <$70 million

565

69%

Texas

67%

Total

2,203

70%

New Jersey

71%

Texas

77%

Georgia

69%

Ohio

74%

Texas

79%

New Jersey

71%

Texas

70%

15 largest commercial real estate loans

495

70%

Institutional Banking

Institutional banking loans outstanding at September 30, 2025

Type

Principal

% of total

(Dollars in millions)

SBLOC

1,137

60%

IBLOC

472

25%

Advisor financing

286

15%

Total

1,895

100%

SBLOC

For SBLOC, we generally lend up to 50% of the value of equities and 80% for investment grade securities. While the value of equities has fallen in excess of 30% in recent years, the reduction in collateral value of brokerage accounts collateralizing SBLOC loans generally has been less, for two reasons. First, many collateral accounts are “balanced” and accordingly have a component of debt securities, which have either not decreased in value as much as equities, or in some cases may have increased in value. Second, many of these accounts have the benefit of professional investment advisors who provided some protection against market downturns, through diversification and other means. Additionally, borrowers often utilize only a portion of collateral value, which lowers the percentage of principal to collateral.

Top 10 SBLOC loans at September 30, 2025

Principal amount

% Principal to

collateral

(Dollars in millions)

10%

34%

35%

83%

10%

46%

20%

33%

37%

Total and weighted average

28%

IBLOC

IBLOC loans are backed by the cash value of eligible life insurance policies which have been assigned to us. We generally lend up to 95% of such cash value. Our underwriting standards require approval of the insurance companies which carry the policies backing these loans. Currently, ten insurance companies have been approved and, as of October 28, 2025, all were rated A- (Excellent) or better by AM BEST.

Direct Lease Financing

Direct lease financing by type as of September 30, 2025

Principal balance (1)

% Total

(Dollars in millions)

Government agencies and public institutions (2)

131

19%

Real estate and rental and leasing

130

19%

Construction

124

18%

Waste management and remediation services

14%

Health care and social assistance

Other services (except public administration)

Professional, scientific, and technical services

Transit and other transportation

Wholesale trade

General freight trucking

Arts, entertainment, and recreation

Finance and insurance

Other

Total

693

100%

(1) Of the total $693 million of direct lease financing, $640 million consisted of vehicle and financing leases with the remaining balance consisting of equipment leases.

(2) Includes public universities as well as school districts.

Direct lease financing by state as of September 30, 2025

State

Principal balance

% Total

(Dollars in millions)

Florida

120

17%

New York

Utah

Connecticut

California

Pennsylvania

Texas

Maryland

New Jersey

North Carolina

Idaho

Alabama

Georgia

Ohio

Tennessee

Other states

136

20%

Total

693

100%

Portfolio Performance

Allowance for credit losses

Nine months ended

Year ended

September 30,

December 31,

2025 (unaudited)

2024 (unaudited)

2024

(Dollars in thousands)

Balance in the allowance for credit losses at beginning of period

44,853

27,378

Loans charged-off:

SBA non-real estate

546

431

708

Direct lease financing

4,416

3,625

4,575

Consumer fintech

142,062

—

19,619

Other loans

924

Total

147,948

4,072

24,920

Recoveries:

SBA non-real estate

102

229

Direct lease financing

575

279

318

Consumer fintech

29,580

—

1,877

Other loans

Total

30,233

382

2,425

Net charge-offs

117,715

3,690

22,495

Provision for credit losses on non-consumer fintech loans

8,123

7,316

9,319

Provision for credit losses on consumer fintech loans

128,891

—

30,651

Balance in allowance for credit losses at end of period

64,152

31,004

44,853

Net charge-offs/average loans

1.85%

0.07%

0.40%

Net charge-offs/average assets

1.30%

0.05%

0.28%

Loan delinquency and Non-accrual

September 30, 2025

30-59 days

60-89 days

90+ days

Total

past due

still accruing

Non-accrual

past due

Current

loans

SBL non-real estate

—

7,125

7,127

215,806

222,933

SBL commercial mortgage

—

16,178

713,442

729,620

SBL construction

—

2,917

31,601

34,518

Direct lease financing

2,422

8,045

251

5,896

16,614

676,708

693,322

SBLOC / IBLOC

3,922

—

1,184

446

5,552

1,603,495

1,609,047

Advisor financing

—

285,531

Real estate bridge loans

—

19,372

17,942

36,677

73,991

2,057,698

2,131,689

Consumer fintech

20,439

1,951

1,163

—

23,553

761,492

785,045

Other loans

—

147

225

164,262

164,487

Unamortized loan fees and costs

—

16,445

26,858

29,368

20,545

69,386

146,157

6,526,480

6,672,637

Other loan information

Of the $55.1 million special mention and $130.2 million substandard loans real estate bridge loans at September 30, 2025, none were modified in the third quarter of 2025.

Other real estate owned year to date activity

Nine months ended

September 30, 2025

Beginning balance

62,025

Transfer from loans, net

2,401

Total realized net gains included in earnings: Non-interest expense - other

594

Sales

(4,926)

Advances

1,880

Ending balance

61,974

Other real estate owned includes a REBL apartment building rehabilitation bridge loan with a balance of $43.0 million and $41.1 million as of September 30, 2025, and December 31, 2024, respectively. As of September 30, 2025, the majority of capital improvements on the property have been completed. Third-party appraisals on the property as of June 30, 2025, for “as stabilized” and "as is" values are $59.1 million and $51.4 million, respectively, or respective LTVs of 73% and 83%.

As previously disclosed, in June 2025, the Company terminated a pending agreement of sale for the property and demanded the escrow agent release to Company all earnest money deposits received to date, totaling $3.0 million. On June 26, 2025, without providing any legal or contractual basis to do so, the purchaser objected to the release of the earnest money deposits. In the third quarter of 2025, the matter was settled for $2.3 million which was recognized in other non-interest income.

Asset Quality Ratios

September 30,

June 30,

December 31,

September 30,

2025

2024

Nonperforming loans to total loans

1.35%

0.96%

0.55%

0.52%

Nonperforming assets to total assets

1.77%

1.45%

1.14%

1.28%

Allowance for credit losses to total loans

0.96%

0.91%

0.73%

0.52%

Non-GAAP Financial Measures

Calculation of efficiency ratio

The efficiency ratio is calculated by dividing GAAP total non-interest expense by the total of GAAP net interest income and non-interest income. This ratio compares revenues generated with the amount of expense required to generate such revenues and may be used as one measure of overall efficiency.

Three months ended

Nine months ended

September 30,

2025

2024

2025

2024

(Dollars in thousands)

Net interest income

94,197

93,732

283,432

281,945

Non-interest income

80,416

32,108

247,801

92,212

Less: Consumer fintech loan credit enhancement

(39,790)

—

(128,891)

—

Adjusted total revenue (1)

134,823

125,840

402,342

374,157

Non-interest expense

56,404

53,255

166,921

151,413

Efficiency ratio

42%

41%

40%

(1) Excludes consumer fintech loan credit enhancement income which represents the amount of consumer fintech loan charge-offs that we expect to recover under third-party contracts. The provision for those loans correlates to a like amount of credit enhancement income.