8-K
Finwise Bancorp (FINW)
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): October 29, 2025
FINWISE BANCORP
(Exact name of registrant as specified in its charter)
| Utah | 001-40721 | 83-0356689 | |||||
|---|---|---|---|---|---|---|---|
| (State or other jurisdiction of incorporation or organization) | (Commission file number) | (I.R.S. employer identification no.) | 756 East Winchester St., Suite 100 | 84107 | |||
| --- | --- | --- | --- | ||||
| Murray, | Utah | ||||||
| (Address of principal executive offices) | (Zip code) |
Registrant’s telephone number, including area code: (801) 501-7200
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:
| ☐ | 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. ☐
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of exchange on which registered |
|---|---|---|
| Common Stock, par value $0.001 per share | FINW | The NASDAQ Stock Market LLC |
Item 2.02Results of Operations and Financial Condition.
Attached and incorporated herein by reference as Exhibit 99.1 is a copy of the press release of FinWise Bancorp (the "Company"), dated October 29, 2025, reporting the Company's financial results for the fiscal quarter ended September 30, 2025.
The information set forth under this “Item 2.02 Results of Operations and Financial Condition,” including Exhibit 99.1 attached hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.
Item 7.01Regulation FD Disclosure.
The Company has prepared materials for presentation to investors. A copy of the materials is furnished as Exhibit 99.2 to this Current Report on Form 8-K and is incorporated herein by reference. The information set forth under “Item 7.01 Regulation FD Disclosure,” including Exhibit 99.2 attached hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Act of 1934, as amended, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.
Item 9.01Financial Statements and Exhibits.
(d)Exhibits
| Exhibit No. | Description |
|---|---|
| 99.1 | Press Release datedOctober 29, 2025 |
| 99.2 | Investor Presentation of FinWise Bancorp datedOctober2025 (furnished pursuant to Regulation FD). |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, FinWise Bancorp has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| DATE: October 29, 2025 | FINWISE BANCORP |
|---|---|
| /s/ Robert Wahlman | |
| Robert Wahlman | |
| Chief Financial Officer and Executive Vice President |
Document
Exhibit 99.1
FINWISE BANCORP REPORTS THIRD QUARTER 2025 RESULTS
Loan Originations of $1.8 Billion -
Net Income of $4.9 Million -
Diluted Earnings Per Share of $0.34 -
MURRAY, UTAH — October 29, 2025 (GLOBE NEWSWIRE) — FinWise Bancorp (NASDAQ: FINW) (“FinWise”, the “Company”, “we”, “our”, or “us”), parent company of FinWise Bank (the “Bank”), today announced results for the quarter ended September 30, 2025.
Third Quarter 2025 Highlights
•Loan originations totaled $1.8 billion, compared to $1.5 billion for the quarter ended June 30, 2025, and $1.4 billion for the third quarter of the prior year
•Net interest income was $18.6 million, compared to $14.7 million for the quarter ended June 30, 2025, and $14.8 million for the third quarter of the prior year
•Net income was $4.9 million, compared to $4.1 million for the quarter ended June 30, 2025, and $3.5 million for the third quarter of the prior year
•Diluted earnings per share (“EPS”) were $0.34 for the quarter, compared to $0.29 for the quarter ended June 30, 2025, and $0.25 for the third quarter of the prior year
•Efficiency ratio1 was 47.6%, compared to 59.5% for the quarter ended June 30, 2025, and 67.5% for the third quarter of the prior year
•Nonperforming loan balances were $42.8 million as of September 30, 2025, compared to $39.7 million as of June 30, 2025, and $30.6 million as of September 30, 2024. Nonperforming loan balances guaranteed by the Small Business Administration (“SBA”) were $23.3 million, $21.2 million, and $17.8 million as of September 30, 2025, June 30, 2025, and September 30, 2024, respectively
“Our strong third quarter results reflect the positive impact of the strategic investments we made over the past two years,” said Kent Landvatter, Chairman and CEO of FinWise Bancorp. “We reported net income of $4.9 million, a 19% increase from the prior quarter and a 42% increase year-over-year. This performance was driven by robust loan originations, a significant increase in credit-enhanced balances, solid revenue growth and disciplined expense management. Total end-of-period assets also reached nearly $900 million for the first time in our Company’s history. Following the end of the quarter, we announced two strategic program agreements, with DreamFi Inc. and Tallied Technologies, and we remain actively engaged in discussions with several potential strategic partners to further expand our strategic initiatives. Overall, we remain confident that our focus on disciplined growth and operational excellence will continue to drive long-term progress and sustainable value creation for our shareholders.”
1 See “Reconciliation of Non-GAAP to GAAP Financial Measures” for a reconciliation of this non-GAAP measure.
Selected Financial and Other Data
| As of and for the Three Months Ended | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| ($ in thousands, except per share amounts) | 9/30/2025 | 6/30/2025 | 9/30/2024 | ||||||
| Amount of loans originated | $ | 1,789,736 | $ | 1,483,179 | $ | 1,448,251 | |||
| Net income | $ | 4,891 | $ | 4,097 | $ | 3,454 | |||
| Diluted EPS(1) | $ | 0.34 | $ | 0.29 | $ | 0.25 | |||
| Return on average assets | 2.2 | % | 2.0 | % | 2.1 | % | |||
| Return on average equity | 10.6 | % | 9.2 | % | 8.3 | % | |||
| Yield on loans | 13.09 | % | 11.70 | % | 14.16 | % | |||
| Cost of interest-bearing deposits | 4.06 | % | 4.07 | % | 4.85 | % | |||
| Net interest margin | 9.01 | % | 7.81 | % | 9.70 | % | |||
| Efficiency ratio(2) | 47.6 | % | 59.5 | % | 67.5 | % | |||
| Tangible book value per share(3) | $ | 13.84 | $ | 13.51 | $ | 12.90 | |||
| Tangible shareholders’ equity to tangible assets(3) | 20.9 | % | 21.6 | % | 24.9 | % | |||
| Leverage ratio (Bank under CBLR) | 17.2 | % | 18.0 | % | 20.3 | % | |||
| Full-time equivalent employees | 194 | 200 | 194 |
(1) FinWise uses the two-class method to calculate basic and diluted EPS as the restricted stock awards are deemed to be participating securities.
(2) Efficiency ratio is a non-GAAP financial measure. The efficiency ratio is defined as total non-interest expense divided by the sum of net interest income and non-interest income. The Company believes this measure is important as an indicator of productivity because it shows the amount of revenue generated for each dollar spent. See “Reconciliation of Non-GAAP to GAAP Financial Measures” for a reconciliation of this measure to its most comparable GAAP measure.
(3) Tangible shareholders’ equity to tangible assets is a non-GAAP financial measure. Tangible shareholders’ equity is defined as total shareholders’ equity less goodwill and other intangible assets. The most directly comparable GAAP financial measure is total shareholder’s equity to total assets. The Company had no goodwill or other intangible assets at the end of any period indicated. The Company has not considered loan servicing rights or loan trailing fee assets as intangible assets for purposes of this calculation. As a result, tangible shareholders’ equity is the same as total shareholders’ equity at the end of each of the periods indicated.
Net Interest Income and Net Interest Margin
Net interest income was $18.6 million for the third quarter of 2025, compared to $14.7 million for the prior quarter and $14.8 million for the prior year period. The increase from the prior quarter was primarily due to an increase in the Bank’s credit enhanced balances in the held-for-investment portfolio of $29.6 million, the higher contractual interest on the credit enhanced balances, and increased average balances in the Strategic Program loans held-for-sale portfolio of $12.9 million, and was offset in part by increased average balances in brokered certificates of deposit accounts. The increase from the prior year period was primarily due to an increase in the Bank’s credit enhanced balances in the held-for-investment portfolio of $40.7 million and increased average balances in the Strategic Program loans held-for-sale portfolio of $62.2 million and was offset in part by growth in the brokered CD portfolio used to fund the loan portfolio growth.
Loan originations totaled $1.8 billion for the third quarter of 2025, an increase from the $1.5 billion recorded in the prior quarter and the $1.4 billion recorded in the prior year period mostly reflecting the expansion of originations from newly onboarded strategic programs, the continued increase in originations by certain established strategic programs, and two strategic programs originating higher volumes of student loans during the quarter.
Net interest margin for the third quarter of 2025 was 9.01%, compared to 7.81% for the prior quarter and 9.70% for the prior year period. The increase in net interest margin from the prior quarter was mainly attributable to growth in the credit enhanced portfolio of $29.6 million offset in part by accrued interest reversals on loans migrating to nonaccrual status during the prior quarter. The decrease in net interest margin from the prior year period was mostly attributable to the Company’s strategy to reduce the average credit risk in the loan portfolio by
increasing its investment in higher quality but lower yielding loans which was offset by the growth in the credit enhanced portfolio of $40.7 million.
Provision for Credit Losses
The Company’s provision for credit losses was $12.8 million for the third quarter of 2025, compared to $4.7 million for the prior quarter and $2.2 million for the prior year period. The increase in the provision for credit losses from the prior quarter and the prior year period resulted primarily from growth of the credit enhanced loan portfolio as well as higher net charge-offs.
Non-interest Income
| Three Months Ended | ||||||
|---|---|---|---|---|---|---|
| ($ in thousands) | 9/30/2025 | 6/30/2025 | 9/30/2024 | |||
| Non-interest income | ||||||
| Strategic Program fees | $ | 6,180 | $ | 5,404 | $ | 4,862 |
| Gain on sale of loans | 1,854 | 1,483 | 393 | |||
| SBA loan servicing fees, net | (242) | (96) | 87 | |||
| Change in fair value on investment in BFG | 200 | 300 | (100) | |||
| Credit enhancement income | 8,762 | 2,275 | 47 | |||
| Other miscellaneous income | 1,298 | 971 | 765 | |||
| Total non-interest income | $ | 18,052 | $ | 10,337 | $ | 6,054 |
The increase in non-interest income from the prior quarter was primarily due to increases in credit enhancement income, Strategic Program fees, gain on sale of loans, and other miscellaneous income. Credit enhancement income mirrors the provision for credit losses on credit enhanced loans and increased principally due to the higher credit enhanced loan balances outstanding at September 30, 2025. The higher Strategic Program fees resulted from increased originations. The gain on sale of loans increased as FinWise increased its sales of the guaranteed portion of SBA 7(a) loan balances to capitalize on favorable market conditions. Other miscellaneous income increased primarily from an increase in dividends received from BFG as well as an increase in operating lease rental income. Offsetting these non-interest income increases in part was a decrease in SBA loan servicing fees due to an increase in the provision for SBA servicing losses due to a change in assumptions used in valuing the SBA servicing asset.
The increase in non-interest income compared to the prior year period was primarily due to higher credit enhanced loan balances, which generated higher credit enhancement income. Additionally, the increased sales of the guaranteed portions of SBA 7(a) loans led to an increase in gains on loan sales, while higher originations resulted in increased Strategic Program fees. Other miscellaneous income also increased, largely because of an increase in dividends received from BFG as well as an increase in operating lease rental income. The decrease in SBA loan servicing fees, net was primarily due to a change in assumptions used in valuing the SBA servicing asset.
Non-interest Expense
| Three Months Ended | ||||||
|---|---|---|---|---|---|---|
| ($ in thousands) | 9/30/2025 | 6/30/2025 | 9/30/2024 | |||
| Non-interest expense | ||||||
| Salaries and employee benefits | $ | 10,814 | $ | 10,491 | $ | 9,659 |
| Professional services | 876 | 949 | 1,331 | |||
| Occupancy and equipment expenses | 456 | 445 | 544 | |||
| Credit enhancement guarantee expense | 1,720 | 78 | 3 | |||
| Other operating expenses | 3,583 | 2,949 | 2,512 | |||
| Total non-interest expense | $ | 17,449 | $ | 14,912 | $ | 14,049 |
The increase in non-interest expense from the prior quarter resulted primarily from increases in credit enhancement guarantee expense largely related to growth in credit enhanced loans. Additionally, other operating expenses increased due to greater servicing costs linked to the balance sheet programs, along with elevated FDIC assessments reflecting our increased deposit balances, data processing services and expenditures on computer software.
The increase in non-interest expense from the prior year period was primarily due to an increase in credit enhancement guarantee expense related to growth in credit enhanced loans, salaries and employee benefits mainly from the amortization of deferred compensation awards incurred to retain and motivate our employees, and increases in other operating expenses due to greater servicing costs linked to the balance sheet programs, operating lease depreciation, elevated FDIC assessments reflecting our increased deposit balances, data processing services and expenditures on computer software.
FinWise’s efficiency ratio was 47.6% for the third quarter, compared to 59.5% for the prior quarter and 67.5% for the prior year period. This reduction in the efficiency ratio was primarily from the increase in credit enhanced income previously mentioned. Looking ahead, it is anticipated that the efficiency ratio is likely to reduce further as revenues are realized in future periods from interest earned on credit enhanced loan balances, along with the contributions from BIN sponsorship offerings and payments initiatives developed throughout 2024 and 2023.
Tax Rate
The Company’s effective tax rate was 23.7% for the third quarter of 2025, compared to 24.5% for the prior quarter and 25.1% for the prior year period. The decrease from the prior quarter and prior year period was principally due to the increase in deferred tax assets related to restricted stock, increased allowances for credit losses, and accrued bonuses. However, these benefits were partially offset by greater deferred tax liabilities associated with other reserves and qualified tax leases as well as an increase in permanent differences, particularly due to non-deductible compensation under Section 162(m) of the Internal Revenue Code.
Net Income
Net income was $4.9 million for the third quarter of 2025, compared to $4.1 million for the prior quarter and $3.5 million for the prior year period. The changes in net income for the three months ended September 30, 2025 compared to the prior quarter and prior year period are generally the result of the factors discussed in the foregoing sections.
Balance Sheet
The Company’s total assets were $899.9 million as of September 30, 2025, an increase from $842.5 million as of June 30, 2025 and $683.0 million as of September 30, 2024. The increase in total assets from June 30, 2025 was primarily due to continued growth in the Company’s net loans held-for-investment of $27.0 million, interest- bearing cash deposits of $14.6 million, loans held-for-sale portfolios of $9.4 million, and an increase in the credit enhancement asset of $8.7 million. The increase in total assets compared to September 30, 2024 was primarily due to increases in the Company’s net loans held-for-investment of $115.5 million, loans held-for-sale portfolio of $72.7 million, an increase in interest-bearing cash deposits of $17.2 million, and an increase in the credit enhancement asset of $11.1 million. The increased loan balances are generally consistent with our strategy to grow the loan portfolio with higher quality lower risk assets.
The following table provides the composition and gross balances of loans held-for-investment (“HFI”) as of the dates indicated:
| 9/30/2025 | 6/30/2025 | 9/30/2024 | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| ($ in thousands) | Amount | % of total loans | Amount | % of total loans | Amount | % of total loans | ||||||
| SBA | $ | 240,060 | 42.2 | % | $ | 246,903 | 46.6 | % | $ | 251,439 | 57.9 | % |
| Commercial leases | 90,413 | 15.8 | % | 88,957 | 16.8 | % | 64,277 | 14.8 | % | |||
| Commercial, non-real estate | 4,827 | 0.9 | % | 5,510 | 1.0 | % | 3,025 | 0.7 | % | |||
| Residential real estate | 60,503 | 10.7 | % | 54,132 | 10.2 | % | 41,391 | 9.5 | % | |||
| Strategic Program loans: | ||||||||||||
| Strategic Program loans - with credit enhancement | 41,369 | 7.3 | % | 11,730 | 2.2 | % | 661 | 0.2 | % | |||
| Strategic Program loans - without credit enhancement | 21,654 | 3.8 | % | 18,969 | 3.6 | % | 18,748 | 4.3 | % | |||
| Commercial real estate: | ||||||||||||
| Owner occupied | 83,302 | 14.7 | % | 77,871 | 14.7 | % | 32,480 | 7.5 | % | |||
| Non-owner occupied | 1,424 | 0.3 | % | 1,417 | 0.3 | % | 2,736 | 0.7 | % | |||
| Consumer | 24,250 | 4.3 | % | 24,555 | 4.6 | % | 19,206 | 4.4 | % | |||
| Total period end loans | $ | 567,802 | 100.0 | % | $ | 530,044 | 100.0 | % | $ | 433,963 | 100.0 | % |
Note: SBA loans as of September 30, 2025, June 30, 2025 and September 30, 2024 include $132.2 million, $144.3 million and $154.5 million, respectively, of SBA 7(a) loan balances that are guaranteed by the SBA. The HFI balance on Strategic Program loans without credit enhancement with annual interest rates below 36% as of September 30, 2025, June 30, 2025 and September 30, 2024 was $3.9 million, $2.3 million and $2.5 million, respectively.
Total gross loans HFI as of September 30, 2025 increased $37.8 million and $133.8 million compared to June 30, 2025 and September 30, 2024, respectively. The Company experienced growth primarily in its commercial real estate loans for owner occupied properties and commercial leases consistent with its strategy to expand its loan portfolio with loans that offer higher quality and lower interest rates. The credit enhanced portfolio of the Strategic Program loans increased $29.6 million in the quarter to $41.4 million consistent with the Company’s strategy to increase the outstanding balance of lower credit risk loans.
The following table presents the Company’s deposit composition as of the dates indicated:
| As of | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 9/30/2025 | 6/30/2025 | 9/30/2024 | ||||||||||
| ($ in thousands) | Amount | Percent | Amount | Percent | Amount | Percent | ||||||
| Noninterest-bearing demand deposits | $ | 130,601 | 19.2 | % | $ | 120,747 | 19.0 | % | $ | 142,785 | 29.2 | % |
| Interest-bearing deposits: | ||||||||||||
| Demand | 89,443 | 13.1 | % | 67,890 | 10.7 | % | 58,984 | 12.1 | % | |||
| Savings | 11,495 | 1.7 | % | 11,623 | 1.8 | % | 9,592 | 1.9 | % | |||
| Money market | 22,634 | 3.3 | % | 21,083 | 3.3 | % | 15,027 | 3.1 | % | |||
| Time certificates of deposit | 428,137 | 62.7 | % | 413,831 | 65.2 | % | 262,271 | 53.7 | % | |||
| Total period end deposits | $ | 682,310 | 100.0 | % | $ | 635,174 | 100.0 | % | $ | 488,659 | 100.0 | % |
The increase in total deposits as of September 30, 2025 from June 30, 2025 and September 30, 2024 was driven primarily by growth in brokered time certificates of deposits, which were added to fund loan growth and enhance the liquidity of the balance sheet. The increase in total deposits from September 30, 2024 was also driven by a higher volume of interest-bearing demand deposits, which resulted largely from new and ongoing customer relationships, partially offset by reductions in noninterest-bearing demand deposits, as customers moved funds into interest-bearing products offering higher yields.
Total shareholders’ equity as of September 30, 2025 increased $5.8 million to $187.8 million from $182.0 million at June 30, 2025. Compared to September 30, 2024, total shareholders’ equity increased by $17.4 million from $170.4 million. The increases from June 30, 2025 and September 30, 2024 were primarily due to net income generated throughout the respective periods.
Bank Regulatory Capital Ratios
The following table presents the leverage ratios for the Bank as of the dates indicated as determined under the Community Bank Leverage Ratio Framework of the Federal Deposit Insurance Corporation:
| As of | ||||
|---|---|---|---|---|
| Capital Ratios | 9/30/2025 | 6/30/2025 | 9/30/2024 | Well-Capitalized Requirement |
| Leverage ratio | 17.2% | 18.0% | 20.3% | 9.0% |
The decrease in the leverage ratio from the prior quarter and prior year period resulted primarily from the growth in the loan portfolio exceeding the relative growth in capital from earnings. The Bank’s capital levels as of September 30, 2025 remain sufficiently above the regulatory well-capitalized guidelines as of September 30, 2025.
Share Repurchase Program
Since the share repurchase program’s inception in March 2024, the Company has repurchased and subsequently retired a total of 44,608 shares for $0.5 million. There were no shares repurchased during the third quarter of 2025.
Asset Quality
The recorded balances of nonperforming loans were $42.8 million, or 7.5% of total loans held-for-investment, as of September 30, 2025, compared to $39.7 million, or 7.5% of total loans held-for-investment, as of June 30, 2025 and $30.6 million, or 7.1% of total loans held-for-investment, as of September 30, 2024. The balances of nonperforming loans guaranteed by the SBA were $23.3 million, $21.2 million, and $17.8 million as of September 30, 2025, June 30, 2025 and September 30, 2024, respectively. The increase in nonperforming loans from the prior quarter and prior year period was primarily attributable to an increase in the SBA 7(a) loan portfolio being classified as nonaccrual mainly due to the negative impact of sustained elevated interest rates on the Company’s small business borrowers. The Company’s allowance for credit losses to total loans held-for-investment was 4.5% as of September 30, 2025 compared to 3.1% as of June 30, 2025 and 2.9% as of September 30, 2024. The increase in the ratio from the prior quarter and prior year period was primarily due to the provision for credit losses related to the growth of the credit enhanced loan balances.
The Company’s net charge-offs were $3.1 million, $2.8 million and $2.4 million for the three months ended September 30, 2025, June 30, 2025, and September 30, 2024, respectively. The increase from the prior quarter was primarily due to an higher charge-offs associated with strategic program loans, while the increase from the prior year period was primarily due to charge-offs on certain held-for-investment balances that were reclassified to nonaccrual status as well as an increase in the charge-offs for strategic program loans.
The following table presents a summary of changes in the allowance for credit losses and credit quality data for the periods indicated:
| Three Months Ended | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| ($ in thousands) | 9/30/2025 | 6/30/2025 | 9/30/2024 | ||||||
| Allowance for credit losses: | |||||||||
| Beginning balance | $ | 16,247 | $ | 14,235 | $ | 13,127 | |||
| Provision for credit losses(1) | 12,658 | 4,796 | 1,944 | ||||||
| Charge-offs | |||||||||
| Construction and land development | — | — | — | ||||||
| Residential real estate | (33) | (210) | (27) | ||||||
| Residential real estate multifamily | — | — | — | ||||||
| Commercial real estate: | |||||||||
| Owner occupied | (258) | (309) | (103) | ||||||
| Non-owner occupied | — | — | (221) | ||||||
| Commercial and industrial | (409) | — | (96) | ||||||
| Consumer | (119) | (210) | (15) | ||||||
| Lease financing receivables | (52) | (133) | (113) | ||||||
| Strategic Program loans | (2,746) | (2,279) | (2,360) | ||||||
| Recoveries | |||||||||
| Construction and land development | — | — | — | ||||||
| Residential real estate | 3 | 3 | 3 | ||||||
| Residential real estate multifamily | — | — | — | ||||||
| Commercial real estate: | |||||||||
| Owner occupied | 90 | 19 | 219 | ||||||
| Non-owner occupied | — | — | — | ||||||
| Commercial and industrial | 1 | — | 2 | ||||||
| Consumer | 3 | 7 | 4 | ||||||
| Lease financing receivables | 52 | 7 | 8 | ||||||
| Strategic Program loans | 341 | 321 | 289 | ||||||
| Ending Balance | $ | 25,778 | $ | 16,247 | $ | 12,661 | |||
| Credit Quality Data | As of and For the Three Months Ended | ||||||||
| ($ in thousands) | 9/30/2025 | 6/30/2025 | 9/30/2024 | ||||||
| Nonperforming loans: | |||||||||
| Guaranteed | $ | 23,333 | $ | 21,178 | $ | 17,804 | |||
| Unguaranteed | 19,445 | 18,561 | 12,844 | ||||||
| Total nonperforming loans | $ | 42,778 | $ | 39,739 | $ | 30,648 | |||
| Allowance for credit losses | $ | 25,778 | $ | 16,247 | $ | 12,661 | |||
| Net charge-offs | $ | 3,127 | $ | 2,784 | $ | 2,409 | |||
| Total loans held-for-investment | $ | 567,802 | $ | 530,043 | $ | 433,963 | |||
| Total loans held-for-investment less guaranteed balances | $ | 435,557 | $ | 385,792 | $ | 279,473 | |||
| Average loans held-for-investment | $ | 550,534 | $ | 514,222 | $ | 422,820 | |||
| Nonperforming loans to total loans held-for-investment | 7.5 | % | 7.5 | % | 7.1 | % | |||
| Net charge-offs to average loans held-for-investment (annualized) | 2.3 | % | 2.2 | % | 2.3 | % | |||
| Allowance for credit losses to loans held-for-investment | 4.5 | % | 3.1 | % | 2.9 | % | |||
| Allowance for credit losses to loans held-for-investment less guaranteed balances | 5.9 | % | 4.2 | % | 4.5 | % |
(1) Excludes the provision for unfunded commitments.
Webcast and Conference Call Information
FinWise will host a conference call today at 5:00 PM ET to discuss its financial results for the third quarter of 2025. A simultaneous audio webcast of the conference call will be available at https://investors.finwisebancorp.com/.
The dial-in number for the conference call is (877) 423-9813 (toll-free) or (201) 689-8573 (international). The conference ID is 13755419. Please dial the number 10 minutes prior to the scheduled start time.
A webcast replay of the call will be available at investors.finwisebancorp.com for six months following the call.
Website Information
The Company intends to use its website, www.finwisebancorp.com, as a means of disclosing material non-public information and for complying with its disclosure obligations under Regulation FD. Such disclosures will be included in the Company’s website’s Investor Relations section. Accordingly, investors should monitor the Investor Relations portion of the Company’s website, in addition to following its press releases, filings with the Securities and Exchange Commission (“SEC”), public conference calls, and webcasts. To subscribe to the Company’s e-mail alert service, please click the “Email Alerts” link in the Investor Relations section of its website and submit your email address. The information contained in, or that may be accessed through, the Company’s website is not incorporated by reference into or a part of this document or any other report or document it files with or furnishes to the SEC, and any references to the Company’s website are intended to be inactive textual references only.
About FinWise Bancorp
FinWise Bancorp is a Utah bank holding company headquartered in Murray, Utah which wholly owns FinWise Bank, a Utah chartered state bank, and FinWise Investment LLC (together “FinWise”). FinWise provides Banking and Payments solutions to fintech brands. Its existing Strategic Program Lending business, conducted through scalable API-driven infrastructure, powers deposit, lending and payments programs for leading fintech brands. As part of Strategic Program Lending, FinWise also provides a Credit Enhanced Balance Sheet Program, which addresses the challenges that lending and card programs face diversifying their funding sources and managing capital efficiency. In addition, FinWise manages other Lending programs such as SBA 7(a), Owner Occupied Commercial Real Estate, and Leasing, which provide flexibility for disciplined balance sheet growth. FinWise is also expanding and diversifying its business model by incorporating Payments (MoneyRails™) and BIN Sponsorship offerings. Through its compliance oversight and risk management-first culture, FinWise is well positioned to guide fintechs through a rigorous process to facilitate regulatory compliance. For more information about FinWise visit https://investors.finwisebancorp.com.
Contacts
investors@finwisebank.com media@finwisebank.com
"Safe Harbor" Statement Under the Private Securities Litigation Reform Act of 1995
This release may contain forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect the Company’s current views with respect to, among other things, the Company’s strategies, goals, beliefs, expectations, estimates, intentions, capital raising efforts, financial condition and results of operations, future performance and business. These statements are often, but not always, made through the use of words or phrases such as “may,” “should,” “could,” “predict,” “believe,” “expect,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “project,” “projection,” “forecast,” “budget,” “goal,” “target,” “would,” “aim” and “outlook,” or similar expressions generally indicate a forward-looking statement.
These forward-looking statements are based on management assumptions and involve risks and uncertainties that are subject to change based on various important factors, some of which are beyond the Company’s control. Numerous competitive, economic, regulatory, legal and technological events and factors, among others, could cause the Company’s actual results to differ materially from those indicated in these forward-looking statements, including: the success of the financial technology and banking-as-a-service industries, as well as the continued evolution of the regulation of these industries; the Company’s ability to maintain and grow its relationships with its service providers and reliance on such providers to comply with regulatory regimes; the Company’s ability to keep pace with rapid technological changes in the industry or implement new technology effectively; ability to effectively manage and remediate system failure or cybersecurity breaches of the Company’s network security; the Company’s ability to measure and manage its credit risk effectively and any deterioration of the business and economic conditions in the Company’s primary market areas; the adequacy of the Company’s allowance for credit losses; changes in Small Business Administration rules, regulations and loan products and the existing regulatory framework for brokered deposits; higher inflation and its impacts; the effects of changes in U.S. trade policies, including the imposition of tariffs and retaliatory tariffs on its trading partners; the value of collateral securing the Company’s loans; the Company’s levels of nonperforming assets; the potential for negative consequences resulting from regulatory violations, investigations and examinations, including potential supervisory actions, the assessment of fines and penalties, the imposition of sanctions, the need to undertake remedial actions and possible damage to the Company’s reputation; natural disasters and adverse weather, acts of terrorism, pandemics, an outbreak of hostilities or other international or domestic calamities; anticipated benefits of new lines of business that the Company may enter or investments or acquisitions the Company may make that are not realized within the expected time frame or at all; further negative ratings outlooks or downgrades of the long-term credit rating of the United States; the ongoing government shutdown and other political impasses, including with respect to the debt ceiling and the federal budget of the United States.
The Company cautions that the foregoing factors are not exclusive, and neither such factors nor any such forward-looking statement takes into account the impact of any future events. All forward-looking statements and information set forth herein are based on management’s current beliefs and assumptions as of the date hereof and speak only as of the date they are made. For a more complete discussion of the assumptions, risks and uncertainties related to our business, you are encouraged to review the Company’s filings with the Securities and Exchange Commission, including its most recent annual report on Form 10-K for the year ended December 31, 2024, subsequently filed quarterly reports on Form 10-Q and current reports on Form 8-K, including any amendments thereto, that update or provide information in addition to the information included in the Form 10-K and Form 10-Q filings, if any. The Company does not undertake to update any forward-looking statement whether written or oral, that may be made from time to time by the Company or by or on behalf of the Company, except as may be required under applicable law.
FINWISE BANCORP
CONSOLIDATED BALANCE SHEETS
($ in thousands; Unaudited)
| 9/30/2025 | 6/30/2025 | 9/30/2024 | ||||
|---|---|---|---|---|---|---|
| ASSETS | ||||||
| Cash and cash equivalents | ||||||
| Cash and due from banks | $ | 10,362 | $ | 9,389 | $ | 7,705 |
| Interest-bearing deposits | 95,265 | 80,711 | 78,063 | |||
| Total cash and cash equivalents | 105,627 | 90,100 | 85,768 | |||
| Investment securities available-for-sale, at fair value | 27,761 | 30,146 | 30,472 | |||
| Investment securities held-to-maturity, at cost | 10,617 | 11,248 | 13,270 | |||
| Investment in Federal Home Loan Bank (“FHLB”) stock, at cost | 440 | 440 | 349 | |||
| Strategic Program loans held-for-sale, at lower of cost or fair value | 156,718 | 147,282 | 84,000 | |||
| Loans held-for-investment, net | 533,549 | 506,503 | 418,065 | |||
| Credit enhancement asset | 11,214 | 2,469 | 86 | |||
| Premises and equipment, net | 2,725 | 2,976 | 3,820 | |||
| Assets subject to operating leases, net | 13,317 | 14,274 | 10,557 | |||
| Accrued interest receivable | 1,959 | 2,380 | 3,098 | |||
| Deferred taxes, net | 1,079 | 279 | — | |||
| SBA servicing asset, net | 3,121 | 3,227 | 3,261 | |||
| Investment in Business Funding Group (“BFG”), at fair value | 8,600 | 8,400 | 7,900 | |||
| Operating lease right-of-use (“ROU”) assets | 3,162 | 3,359 | 3,735 | |||
| Income tax receivable, net | 3,314 | 4,100 | 3,317 | |||
| Other assets | 16,726 | 15,305 | 15,333 | |||
| Total assets | $ | 899,929 | $ | 842,488 | $ | 683,031 |
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||
| Liabilities | ||||||
| Deposits | ||||||
| Noninterest-bearing | $ | 130,601 | $ | 120,747 | $ | 142,785 |
| Interest-bearing | 551,709 | 514,427 | 345,874 | |||
| Total deposits | 682,310 | 635,174 | 488,659 | |||
| Accrued interest payable | 4,518 | 3,746 | 647 | |||
| Income taxes payable, net | 839 | — | — | |||
| Deferred taxes, net | — | — | 1,036 | |||
| Operating lease liabilities | 4,683 | 4,955 | 5,542 | |||
| Other liabilities | 19,814 | 16,654 | 16,777 | |||
| Total liabilities | 712,164 | 660,529 | 512,661 | |||
| Shareholders’ equity | ||||||
| Common stock | 14 | 13 | 13 | |||
| Additional paid-in-capital | 59,417 | 58,135 | 56,214 | |||
| Retained earnings | 128,282 | 123,809 | 113,801 | |||
| Accumulated other comprehensive income, net of tax | 52 | 2 | 342 | |||
| Total shareholders’ equity | 187,765 | 181,959 | 170,370 | |||
| Total liabilities and shareholders’ equity | $ | 899,929 | $ | 842,488 | $ | 683,031 |
FINWISE BANCORP
CONSOLIDATED STATEMENTS OF INCOME
($ in thousands, except per share amounts; Unaudited)
| Three Months Ended | ||||||
|---|---|---|---|---|---|---|
| 9/30/2025 | 6/30/2025 | 9/30/2024 | ||||
| Interest income | ||||||
| Interest and fees on loans | $ | 22,532 | $ | 18,485 | $ | 17,590 |
| Interest on securities | 360 | 390 | 298 | |||
| Other interest income | 1,074 | 867 | 1,036 | |||
| Total interest income | 23,966 | 19,742 | 18,924 | |||
| Interest expense | ||||||
| Interest on deposits | 5,359 | 5,014 | 4,161 | |||
| Total interest expense | 5,359 | 5,014 | 4,161 | |||
| Net interest income | 18,607 | 14,728 | 14,763 | |||
| Provision for credit losses | 12,799 | 4,726 | 2,157 | |||
| Net interest income after provision for credit losses | 5,808 | 10,002 | 12,606 | |||
| Non-interest income | ||||||
| Strategic Program fees | 6,180 | 5,404 | 4,862 | |||
| Gain on sale of loans, net | 1,854 | 1,483 | 393 | |||
| SBA loan servicing fees, net | (242) | (96) | 87 | |||
| Change in fair value on investment in BFG | 200 | 300 | (100) | |||
| Credit enhancement income | 8,762 | 2,275 | 47 | |||
| Other miscellaneous income | 1,298 | 971 | 765 | |||
| Total non-interest income | 18,052 | 10,337 | 6,054 | |||
| Non-interest expense | ||||||
| Salaries and employee benefits | 10,814 | 10,491 | 9,659 | |||
| Professional services | 876 | 949 | 1,331 | |||
| Occupancy and equipment expenses | 456 | 445 | 544 | |||
| Credit enhancement guarantee expense | 1,720 | 78 | 3 | |||
| Other operating expenses | 3,583 | 2,949 | 2,512 | |||
| Total non-interest expense | 17,449 | 14,912 | 14,049 | |||
| Income before income taxes | 6,411 | 5,427 | 4,611 | |||
| Provision for income taxes | 1,520 | 1,330 | 1,157 | |||
| Net income | $ | 4,891 | $ | 4,097 | $ | 3,454 |
| Earnings per share, basic | $ | 0.36 | $ | 0.31 | $ | 0.26 |
| Earnings per share, diluted | $ | 0.34 | $ | 0.29 | $ | 0.25 |
| Weighted average shares outstanding, basic | 12,859,264 | 12,781,508 | 12,658,557 | |||
| Weighted average shares outstanding, diluted | 13,615,354 | 13,472,394 | 13,257,835 | |||
| Shares outstanding at end of period | 13,571,090 | 13,469,725 | 13,211,160 |
FINWISE BANCORP
AVERAGE BALANCES, YIELDS, AND RATES
($ in thousands; Unaudited)
| Three Months Ended | ||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 9/30/2025 | 6/30/2025 | 9/30/2024 | ||||||||||||||||
| Average Balance | Interest | Average Yield/Rate | Average Balance | Interest | Average Yield/Rate | Average Balance | Interest | Average Yield/Rate | ||||||||||
| Interest-earning assets: | ||||||||||||||||||
| Interest-bearing deposits | $ | 97,404 | $ | 1,074 | 4.37 | % | $ | 81,017 | $ | 867 | 4.29 | % | $ | 78,967 | $ | 1,036 | 5.22 | % |
| Investment securities | 39,497 | 360 | 3.61 | % | 41,920 | 390 | 3.73 | % | 33,615 | 298 | 3.53 | % | ||||||
| Strategic Program loans held-for-sale | 132,314 | 6,219 | 18.65 | % | 119,402 | 5,636 | 18.93 | % | 70,123 | 4,913 | 27.87 | % | ||||||
| Loans held-for-investment | 550,534 | 16,313 | 11.76 | % | 514,222 | 12,849 | 10.02 | % | 422,820 | 12,677 | 11.93 | % | ||||||
| Total interest-earning assets | 819,749 | 23,966 | 11.60 | % | 756,561 | 19,742 | 10.47 | % | 605,525 | 18,924 | 12.43 | % | ||||||
| Noninterest-earning assets | 65,084 | 60,638 | 56,290 | |||||||||||||||
| Total assets | $ | 884,833 | $ | 817,199 | $ | 661,815 | ||||||||||||
| Interest-bearing liabilities: | ||||||||||||||||||
| Demand | $ | 69,941 | $ | 630 | 3.57 | % | $ | 64,885 | $ | 579 | 3.58 | % | $ | 55,562 | $ | 547 | 3.92 | % |
| Savings | 12,271 | 54 | 1.75 | % | 10,028 | 15 | 0.60 | % | 9,538 | 18 | 0.76 | % | ||||||
| Money market accounts | 24,629 | 237 | 3.82 | % | 17,920 | 170 | 3.81 | % | 13,590 | 127 | 3.72 | % | ||||||
| Certificates of deposit | 417,059 | 4,438 | 4.22 | % | 400,757 | 4,250 | 4.25 | % | 262,537 | 3,469 | 5.26 | % | ||||||
| Total deposits | 523,900 | 5,359 | 4.06 | % | 493,590 | 5,014 | 4.07 | % | 341,227 | 4,161 | 4.85 | % | ||||||
| Other borrowings | — | — | — | % | 6 | — | 0.45 | % | 112 | — | 0.35 | % | ||||||
| Total interest-bearing liabilities | 523,900 | 5,359 | 4.06 | % | 493,596 | 5,014 | 4.07 | % | 341,339 | 4,161 | 4.85 | % | ||||||
| Noninterest-bearing deposits | 140,499 | 112,627 | 127,561 | |||||||||||||||
| Noninterest-bearing liabilities | 36,552 | 32,753 | 25,536 | |||||||||||||||
| Shareholders’ equity | 183,882 | 178,223 | 167,379 | |||||||||||||||
| Total liabilities and shareholders’ equity | $ | 884,833 | $ | 817,199 | $ | 661,815 | ||||||||||||
| Net interest income and interest rate spread | $ | 18,607 | 7.54 | % | $ | 14,728 | 6.39 | % | $ | 14,763 | 7.58 | % | ||||||
| Net interest margin | 9.01 | % | 7.81 | % | 9.70 | % | ||||||||||||
| Ratio of average interest-earning assets to average interest- bearing liabilities | 156.47 | % | 153.28 | % | 177.40 | % |
Reconciliation of Non-GAAP to GAAP Financial Measures
(Unaudited)
| Efficiency ratio | Three Months Ended | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| ($ in thousands) | 9/30/2025 | 6/30/2025 | 9/30/2024 | ||||||
| Non-interest expense | $ | 17,449 | $ | 14,912 | $ | 14,049 | |||
| Net interest income | 18,607 | 14,728 | 14,763 | ||||||
| Total non-interest income | 18,052 | 10,337 | 6,054 | ||||||
| Adjusted operating revenue | $ | 36,659 | $ | 25,065 | $ | 20,817 | |||
| Efficiency ratio | 47.6 | % | 59.5 | % | 67.5 | % |
The following table presents the impact of the credit enhancement program on our efficiency ratio:
| Adjusted efficiency ratio | Three Months Ended | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| ($ in thousands) | 9/30/2025 | 6/30/2025 | 9/30/2024 | ||||||
| Non-interest expense (GAAP) | $ | 17,449 | $ | 14,912 | $ | 14,049 | |||
| Less: credit enhancement program expenses | 1,968 | 90 | 3 | ||||||
| Adjusted non-interest expense | 15,481 | 14,822 | 14,046 | ||||||
| Net interest income (GAAP) | 18,607 | 14,728 | 14,763 | ||||||
| Less: credit enhancement interest | 1,968 | 90 | 3 | ||||||
| Adjusted net interest income | 16,639 | 14,638 | 14,760 | ||||||
| Total non-interest income (GAAP) | 18,052 | 10,337 | 6,054 | ||||||
| Less: credit enhancement income | 8,762 | 2,275 | 47 | ||||||
| Adjusted non-interest income | 9,290 | 8,062 | 6,007 | ||||||
| Adjusted operating revenue | $ | 25,929 | $ | 22,700 | $ | 20,767 | |||
| Adjusted efficiency ratio | 59.7 | % | 65.3 | % | 67.6 | % |
FinWise has entered into agreements with certain of its Strategic Program service providers pursuant to which they provide credit enhancement on loans which protects the Bank by indemnifying or reimbursing the Bank for incurred credit and fraud losses. We estimate and record a provision for expected losses for these Strategic Program loans in accordance with GAAP, which requires estimation of the provision without consideration of the credit enhancement. When the provision for expected losses over the life of the loans that are subject to such credit enhancement is recorded, a credit enhancement asset reflecting the future recovery of those estimated credit losses pursuant to the strategic partner’s guarantee to assume the Bank’s credit losses on each of the loans in the respective guaranteed portfolio is also recorded on the balance sheet in the form of non-interest income (credit enhancement income). Reimbursement or indemnification for incurred losses is provided for in the form of a deposit reserve account that is replenished periodically by the respective Strategic Program service provider. The credit enhancement asset is reduced as credit enhancement payments and recoveries are received from the Strategic Program service provider or taken from its cash reserve account. If the Strategic Program service provider is unable to fulfill its contracted obligations under its credit enhancement agreement, then the Bank could be exposed to the loss of the reimbursement and credit enhancement income as a result of this counterparty risk. The Bank incurs expenses for the amounts owed to the strategic partner for the credit guarantee and for servicing of the credit enhanced portfolio, if applicable (credit enhancement program expenses). See the following reconciliations of non-GAAP measures for the impact of the credit enhancement on our financial condition and results. Note that these amounts are supplemental and are not a substitute for an analysis based on GAAP measures.
The following non-GAAP measures are presented to illustrate the impact of certain credit enhancement program expenses on total interest income on loans held-for-investment and average yield on loans held-for-investment:
| As of and for the Three Months Ended | As of and for the Three Months Ended | As of and for the Three Months Ended | ||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| ($ in thousands; unaudited) | 9/30/2025 | 6/30/2025 | 9/30/2024 | |||||||||||||||
| Total Average Loans HFI | Total Interest Income on Loans HFI | Average Yield on Loans HFI | Total Average Loans HFI | Total Interest Income on Loans HFI | Average Yield on Loans HFI | Total Average Loans HFI | Total Interest Income on Loans HFI | Average Yield on Loans HFI | ||||||||||
| Before adjustment for credit enhancement | $ | 550,534 | $ | 16,313 | 11.76 | % | $ | 514,222 | $ | 12,849 | 10.02 | % | $ | 422,820 | $ | 12,677 | 11.93 | % |
| Less: credit enhancement program expenses | (1,968) | (90) | (3) | |||||||||||||||
| Net of adjustment for credit enhancement program expenses | $ | 550,534 | $ | 14,345 | 10.34 | % | $ | 514,222 | $ | 12,759 | 9.95 | % | $ | 422,820 | $ | 12,674 | 11.89 | % |
Total interest income on loans held-for-investment net of credit enhancement program expenses and the average yield on loans held-for-investment net of credit enhancement program expenses are non-GAAP measures that include the impact of credit enhancement program expenses on total interest income on loans held-for-investment and the respective average yield on loans held-for-investment, the most directly comparable GAAP measures.
The following non-GAAP measures are presented to illustrate the impact of certain credit enhancement program expenses on net interest income and net interest margin:
| As of and for the Three Months Ended | As of and for the Three Months Ended | As of and for the Three Months Ended | ||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 9/30/2025 | 6/30/2025 | 9/30/2024 | ||||||||||||||||
| ($ in thousands; unaudited) | Total Average Interest-Earning Assets | Net Interest Income | Net Interest Margin | Total Average Interest-Earning Assets | Net Interest Income | Net Interest Margin | Total Average Interest-Earning Assets | Net Interest Income | Net Interest Margin | |||||||||
| Before adjustment for credit enhancement | $ | 819,749 | $ | 18,607 | 9.01 | % | $ | 756,561 | $ | 14,728 | 7.81 | % | $ | 605,525 | $ | 14,763 | 9.70 | % |
| Less: credit enhancement program expenses | (1,968) | (90) | (3) | |||||||||||||||
| Net of adjustment for credit enhancement program expenses | $ | 819,749 | $ | 16,639 | 8.05 | % | $ | 756,561 | $ | 14,638 | 7.76 | % | $ | 605,525 | $ | 14,760 | 9.67 | % |
Net interest income and net interest margin net of credit enhancement program expenses are non-GAAP measures that include the impact of credit enhancement program expenses on net interest income and net interest margin, the most directly comparable GAAP measures.
Non-interest expenses less credit enhancement program expenses is a non-GAAP measure presented to illustrate the impact of credit enhancement program expenses on non-interest expense:
| ($ in thousands; unaudited) | Three Months Ended September 30, 2025 | Three Months Ended June 30, 2025 | Three Months Ended September 30, 2024 | |||
|---|---|---|---|---|---|---|
| Total non-interest expense | $ | 17,449 | $ | 14,912 | $ | 14,049 |
| Less: credit enhancement program expenses | (1,968) | (90) | (3) | |||
| Total non-interest expense less credit enhancement program expenses | $ | 15,481 | $ | 14,823 | $ | 14,046 |
Total non-interest expense less credit enhancement program expenses is a non-GAAP measure that illustrates the impact of credit enhancement program expenses on non-interest expense, the most directly comparable GAAP measure.
Total non-interest income less credit enhancement income is a non-GAAP measure to illustrate the impact of credit enhancement income resulting from credit enhanced loans on non-interest income:
| ($ in thousands; unaudited) | Three Months Ended September 30, 2025 | Three Months Ended June 30, 2025 | Three Months Ended September 30, 2024 | |||
|---|---|---|---|---|---|---|
| Total non-interest income | $ | 18,052 | $ | 10,337 | $ | 6,054 |
| Less: credit enhancement income | (8,762) | (2,275) | (47) | |||
| Total non-interest income less credit enhancement income | $ | 9,290 | $ | 8,062 | $ | 6,007 |
Total non-interest income less indemnification income is a non-GAAP measure that illustrates the impact of credit enhancement income on non-interest income. The most directly comparable GAAP measure is non-interest income.
The following non-GAAP measure is presented to illustrate the effect of the credit enhancement program that creates the credit enhancement on the allowance for credit losses:
| ($ in thousands; unaudited) | As of September 30, 2025 | As of June 30, 2025 | As of September 30, 2024 | |||
|---|---|---|---|---|---|---|
| Allowance for credit losses | $ | 25,778 | $ | 16,247 | $ | 12,661 |
| Less: allowance for credit losses related to credit enhanced loans | (11,214) | (2,469) | (86) | |||
| Allowance for credit losses excluding the effect of the allowance for credit losses related to credit enhanced loans | $ | 14,564 | $ | 13,778 | $ | 12,575 |
The allowance for credit losses excluding the effect of the allowance for credit losses related to credit enhanced loans is a non-GAAP measure that reflects the effect of the credit enhancement program on the allowance for credit losses. The total outstanding balance of loans held-for-investment with credit enhancement as of September 30, 2025, June 30, 2025 and September 30, 2024 was approximately $41.4 million, $11.7 million and $0.7 million, respectively.
16
finw_investorxpresentati
October 2025
2 Disclaimers "Safe Harbor" Statement Under the Private Securities Litigation Reform Act of 1995 This presentation may contain forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect the Company’s current views with respect to, among other things, the Company’s strategies, goals, beliefs, expectations, estimates, intentions, capital raising efforts, financial condition and results of operations, future performance and business. These statements are often, but not always, made through the use of words or phrases such as “may,” “should,” “could,” “predict,” “believe,” “expect,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “project,” “projection,” “forecast,” “budget,” “goal,” “target,” “would,” “aim” and “outlook,” or similar expressions generally indicate a forward- looking statement. These forward-looking statements are based on management assumptions and involve risks and uncertainties that are subject to change based on various important factors, some of which are beyond the Company’s control. Numerous competitive, economic, regulatory, legal and technological events and factors, among others, could cause the Company’s actual results to differ materially from those indicated in these forward-looking statements, including: the success of the financial technology and banking-as-a-service (“BaaS”) industries, as well as the continued evolution of the regulation of these industries; the Company’s ability to maintain and grow its relationships with its service providers and reliance on such providers to comply with regulatory regimes; the Company’s ability to keep pace with rapid technological changes in the industry or implement new technology effectively; ability to effectively manage and remediate system failure or cybersecurity breaches of the Company’s network security; the Company’s ability to measure and manage its credit risk effectively and any deterioration of the business and economic conditions in the Company’s primary market areas; the adequacy of the Company’s allowance for credit losses; changes in Small Business Administration rules, regulations and loan products and the existing regulatory framework for brokered deposits; higher inflation and its impacts; the effects of changes in U.S. trade policies, including the imposition of tariffs and retaliatory tariffs on its trading partners; the value of collateral securing the Company’s loans; the Company’s levels of nonperforming assets; the potential for negative consequences resulting from regulatory violations, investigations and examinations, including potential supervisory actions, the assessment of fines and penalties, the imposition of sanctions, the need to undertake remedial actions and possible damage to the Company’s reputation; natural disasters and adverse weather, acts of terrorism, pandemics, an outbreak of hostilities or other international or domestic calamities; anticipated benefits of new lines of business that the Company may enter or investments or acquisitions the Company may make that are not realized within the expected time frame or at all; further negative ratings outlooks or downgrades of the long-term credit rating of the United States; and the ongoing government shutdown and other political impasses, including with respect to the debt ceiling and the federal budget of the United States. The Company cautions that the foregoing factors are not exclusive, and neither such factors nor any such forward-looking statement takes into account the impact of any future events. All forward-looking statements and information set forth herein are based on management’s current beliefs and assumptions as of the date hereof and speak only as of the date they are made. For a more complete discussion of the assumptions, risks and uncertainties related to our business, you are encouraged to review the Company’s filings with the Securities and Exchange Commission, including its most recent annual report on Form 10-K for the year ended December 31, 2024, subsequently filed quarterly reports on Form 10-Q and current reports on Form 8-K, including any amendments thereto, that update or provide information in addition to the information included in the Form 10-K and Form 10-Q filings, if any. The Company does not undertake to update any forward-looking statement whether written or oral, that may be made from time to time by the Company or by or on behalf of the Company, except as may be required under applicable law. Market and industry data This presentation includes estimates regarding market and industry data. Certain information is based on management estimates, which have been derived from third-party sources, as well as data from our internal research. While we believe the estimated market and industry data included in this presentation is generally reliable as of the date of the presentation, such information, which is derived in part from management’s estimates and beliefs, has not been independently verified and we make no representation as to the adequacy, fairness or completeness of any information obtained from third party sources. Non-GAAP financial measures Some of the financial measures included in this presentation are not measures of financial performance recognized by generally accepted accounting principles in the United States (“GAAP”). These non-GAAP financial measures are “tangible shareholders’ equity,” “tangible book value per share,” and “efficiency ratio.” We believe these non-GAAP financial measures provide useful information to management and investors; however, we acknowledge that our non-GAAP financial measures have limitations and should be considered a supplement to, not a substitute for, the GAAP financial measure. As such, you should not view these measures as a substitute for results determined in accordance with GAAP. A reconciliation of such non-GAAP financial measures to the most directly comparable GAAP financial measures is included in the Appendix to this presentation. Trademarks “FinWise” and its logos and other trademarks referred to and included in this presentation belong to us and are protected by applicable laws. We refer to our trademarks in this presentation without the ® or the ™ or symbols for convenience. Other service marks, trademarks and trade names referred to in this presentation, if any, are the property of their respective owners, although for presentational convenience we may not use the ® or the ™ symbols to identify such trademarks. Certain Terms In this presentation, we use certain defined terms and terms understood within the banking sector and industry. A Glossary of Terms Used is included in the Appendix to this presentation.
FinWise Overview Differentiated Business Model • Banking and payments solutions provider to fintechs • Resilient and profitable model with compelling growth opportunities • Compliance oversight and risk management-first culture • Lower risk loan portfolio with disciplined underwriting and collateral management: • 40% of portfolio at 3Q25 is SBA Guaranteed and Strategic Program HFS1 (HFS loans are typically cash-collateralized and held for less than one week) • Credit Enhanced Balance Sheet2 product incorporates a fintech financed loss reserve account structured to absorb credit losses • Well capitalized significantly above regulatory requirement • Highly experienced team with proven track record 1SBA Guaranteed loans are guaranteed by U.S Small Business Administration and Strategic Program Loans (HFS) are supported by reserve deposit accounts. 2See Glossary slide at end of presentation for definition of Credit Enhanced. 3 • Fintech Banking & Payments Solutions: • Strategic Program Lending (SPL). Through our scalable API-driven infrastructure • SPL - Credit Enhanced Balance Sheet2. Provides opportunity to generate lower risk asset growth and interest income • Payments (MoneyRailsTM) and BIN Sponsorship. Provides opportunity to diversify business model, generate lower-cost deposits and add fee income • Traditional Lending. Provides flexibility for disciplined balance sheet growth: • SBA 7(a), including SBA guaranteed loans • Residential and owner occupied CRE • Equipment leasing programs Key Products
Our Culture - Strong Compliance and Risk Management 4 Consistent Investment in Personnel & Infrastructure Provides Regulatory Oversight Support to Fintechs Note: FTEs shown as of the end of each respective quarter; does not include FTEs in Governance and Operations. 69 (or 36%) of our 194 FTEs at the end of 3Q25 are in IT, Compliance, Risk Mgmt., and BSA functions NOTE: Although the number of FTEs declined in 3Q25, the proportion of FTEs dedicated to regulatory oversight and IT functions remained consistent with prior quarters. This stability reflects our continued focus on operational efficiency and strategic resource allocation.
Equipment Leasing Programs Balance Sheet Strategy: • Originate for Investment • Originations through vendor finance, additional third-party originators, direct channels • Diversify balance sheet Fintech Banking & Payments Solutions (includes Strategic Program Lending) Balance Sheet Strategy: • Mostly originate to sell • Interest Income HFI & HFS • Minimum program & other fees • Programs establish a “reserve” deposit account with FinWise • Credit Enhanced Bal. Sheet SBA 7(a) Balance Sheet Strategy: • Hold or sell guaranteed portion • Retain all servicing rights when guaranteed portion is sold • Leverage relationship with Business Funding Group, LLC for acquiring customers Residential & Owner Occupied CRE Balance Sheet Strategy: • Originate for Investment • Source of core deposits • High-touch, relationship banking • Historically stable and strong profitability Revenue Contribution by Product (ex-Payments & BIN) 3Q25 Gross Revenue Contribution1 1Does not include revenue from POS Lending Program which is an originate to hold strategy, “Other”, “Change in Fair Value on investment in BFG”, "Credit Enhancement", and revenue generated by non-lending activities. Note: SBA Guaranteed loans are guaranteed by U.S Small Business Administration; Strategic Program Loans (HFS) are supported by reserve deposit accounts. 48.1% 15.5% 3.4% 5 6.1% Differentiated and Proven Strategy Offers Solid Foundation for Future Growth As of 9/30/25: • Strategic Platform Loans on Bal. Sheet: $219.7M (71.3% HFS; 28.7% HFI) • 3Q25 Gain on Sale (net) and Strategic Program Fees: $6.4 million or 35.7% of non- interest income As of 9/30/25: • SBA Loans on Bal. Sheet: $240.1 (55.1% Guaranteed; 44.9% Unguaranteed) Product Overview: • Consumer and commercial lending • Construction lending focus on single-family residential Product Overview: • Equipment secured leases/ loans • Interest bearing (generally 60-month fixed rates) • "Aurora" loan origination system provides scalability and automation Target Customer: • Consumers and small to medium-sized businesses (SMBs) via Fintech Platforms Target Customer: • SMBs Target Customer: • Single family residential and SMBs Target Customer: • SMBs via Equipment point of sale TRADITIONAL LENDING PRODUCTS
Review of Strategic Program Lending (SPL): Role of the Bank and Fintech 6 Loan Applications and Approvals Adhere to Credit Models Established by FinWise
Strategic Program Lending (SPL) - Program Diversification Has Improved Note: Strategic Program Lending concentration shown since 1Q22 to highlight longer-term pattern in recent years 7
8 Select Fintech Brands We Currently Support Note: Upstart, Elevate, Reach and FUTR Payments (formerly Hank Payments) are not on MoneyRailsTM, but FinWise does handle Payment Processing for them. Growth Opportunity With Existing Fintechs And As New Programs Are Onboarded
Growth Strategy: Broader Fintech Banking & Payments Solutions Offering 1SBA 7(a) includes Guaranteed and Unguaranteed loans; Guaranteed loans are guaranteed by U.S Small Business Administration. Note: "Fintech Banking & Payments Solutions" is used to describe our target market within the banking as a service ecosystem. 9 Strategic Program Lending (SPL) SBA 7(a)1 Resi. & Owner Occupied CRE Equipment Financing BIN Sponsorship Strategic Program Lending (SPL) + Credit Enhancement SBA 7(a)1 Equipment Financing Resi. & Owner Occupied CRE Incorporating Credit Enhanced, Payments and BIN Products Enhances Revenue Diversification Payments (MoneyRails™) NOTE: Payments and BIN Sponsorship products poised to deliver growth later in 2026/27
Growth Strategy: Potential Long-term Benefits from Our Fintech Banking and Payments Solutions Offering Revenue Expand and diversify sources of revenue Deposits Diversify deposit composition and reduce cost of funds Credit Quality Increase Prime loan exposure Profitability Enhance profitability and oper. leverage via lower cost of funds and use of outsourced solutions Note: "Potential Long-term Benefits" describe the Company's expectations of potential benefits to the overall FinWise business model 10
New Products Offered Under One Platform 1 Credit approval by FinWise is required 11 A Differentiator of Our Fintech Banking & Payments Solutions Offering
12 Interest Income • Monthly fee driven by originated loan volume • On loans held for a few days before sold and on extended held for sale loans • On loans held for investment • Incorporated in Strategic Program Lending (SPL) monthly fee • Contractual interest earned on loans maintained on our bal. sheet • Note: payments to Fintechs of excess spread are mostly expensed. Also, fintechs are required to hold a deposit acct. at FinWise against which charge-offs are recovered, trued up monthly post charge-offs • Monthly fees (including Acct. Mgmt. fees) • Transaction Fees (ACH, Wires, Real Time, etc.) • None • Note: lower cost deposits generated help NII • Monthly fees driven by dollar volume spent • On receivables held for a few days before sold • On receivables held for investment • Monthly fees driven by dollar volume spent • None • Note: lower cost deposits generated help NII • Gain on sale of loans (SBA 7a) • Traditional interest income 1MoneyRailsTM enhances fee revenue opportunity in SPL and Cards. Note: SBA Guaranteed loans are guaranteed by U.S Small Business Administration and Strategic Program Loans (HFS) are supported by reserve deposit accounts. A Deeper Dive Into Our Diversified Revenue Model Strategic Program Lending (SPL) Payments (MoneyRails™)¹ Credit Cards Traditional Lending (SBA 7(a), Residential & Owner Occupied CRE, Equipment Financing) Strategic Program Lending (SPL): Credit Enhanced Bal. Sheet Prepaid & Debit Cards Type of Revenue Generated by Product BIN Sponsorships: Net Interest Income (NII)Fee Income
MoneyRailsTM Overview and Map of Services 13 MoneyRailsTM is an Award Winning, Proprietary, Centralized, Secure Platform and Ledger that Facilitates Money Movement • Highly secured platform built on ZeroTrust architecture, and based on an immutable ledger of transactions • The Ledger provides a strong foundation with controls, standing instructions and connectors for third-party integrations • Fintechs can build their own experience using APIs without dependency on FinWise • Provides tokenized and virtual card servicing capabilities, which enables incoming/ outgoing payments and card mgmt. to be housed in a central hub 1 Cards will be available in 2H 2026. NOTE: Currently Live: Ledgering, ACH, RTP, FedNow, Wires, RPPS, File-based support, KYC/KYB Connector, API enabled, Fraud Monitoring
Components of Model Enable Scaling and Regulatory Oversight Our Technology:Product: Enterprise Data Warehouse -Proprietary and rigorous regulatory process -FinWise controls the data internally Lending programs, including closed and open-ended consumer and commercial • Verify borrower information • Validate loans to models and underwriting criteria, and originate API 2) Payments (MoneyRailsTM) Payments (MoneyRailsTM) ACH, SDA, TCH RTP, FedNow, Wire, Visa Direct and Mastercard Send, Mastercard RPPS • Rules-based money movement configurations and restrictions • Verification, validation and capture of necessary oversight data API 3) BIN Sponsorship Card Processors Credit and Charge Cards Debit cards; prepaid • Capture daily cardholder financial activity and bank-defined data sets necessary for oversight and testing of regulatory compliance Data 14 1) Strategic Program Lending Credit Engine
Intensive Due-Diligence Process and Compliance Assessment Representative Fintech Onboarding - a Thorough Selection Process Including: 15
Disciplined Underwriting Process Mitigates Risk... • Credit risk is managed through combination of policy, data and pricing • Disciplined underwriting process and well collateralized portfolio has helped mitigate net charge-offs, even as credit quality normalized due to an elevated interest rate environment • Remain well-reserved: ACL/Total Gross Loans HFI of 4.5% at end of 3Q25: • SBA guaranteed balances as % of Total Gross Loans HFI have declined as we continue to sell guaranteed portions of SBA loans due to favorable market conditions • Strategic Programs (SP) HFI balances as % of Total Gross Loans HFI, have increased partly driven by higher Credit Enhanced balances 16 *ACL = Allowance for Credit Losses; SP = Strategic Programs; HFI = Held for Investment
...and Leads to a Diversified and Lower Risk Loan Portfolio Key Quarterly Trends: • Combined SBA Guaranteed and Strategic Program Loans Held-for-Sale (HFS) increased to a total of 39.9% of the portfolio as of 3Q25 vs 46.0% as of 3Q24. ◦ Both products carry lower credit risk: SBA Guaranteed loans are guaranteed by the U.S Small Business Administration and Strategic Program Loans (HFS) are supported by reserve deposit accounts • SBA Unguaranteed loans declined from 18.7% of the portfolio as of 3Q24 to 14.9% as of 3Q25 - while the absolute dollar amount of these loans remained relatively stable, the decline as a percent of the portfolio is primarily attributable to overall balance sheet grown, especially in Credit Enhanced loans • SBA Guaranteed balances have declined as we continue to sell amounts of the guaranteed portion of SBA loans 17 1Total Loans includes Held for Investment (HFI) and Held for Sale (HFS) NOTE: Commercial (Non RE) is mostly Equipment Leasing. Portfolio Characteristics: • SBA: Average FICO is 740+. Average time in business is 12+ years. Top 3 industries by Unguaranteed balances: eCommerce, Law Firms and Health Care. Note: Our SBA loss rate has been approximately 73% lower than the SBA 7(a) industry for all originations since 2014. • CRE Non-SBA (11.7% as of 3Q25) is 98.3% Owner Occupied
Deposit Composition 18 As of September 30, 2025, Total Period End Deposits: $682.3 Million Opportunity to enhance profitability by gradually diversifying deposit composition away from higher-cost CDs and reducing cost of funds
Consistent TBV Growth Has Been a Win for Shareholders Tangible Book Value Per Share (Non-GAAP)1 19 1See Appendix at end of presentation for full description of metric and Non-GAAP reconciliation. Amounts are as of the end of each respective period. 2Bank Peers defined as: Oregon Bancorp, Inc., Quaint Oak Bancorp, Inc., University Bancorp, Inc., BayFirst Financial Corp., CF Bankshares Inc., Meridian Corporation, Coastal Financial Corporation, Capital Bancorp, Inc., FS Bancorp, Inc., Blue Ridge Bankshares, Inc., First Internet Bancorp, Nicolet Bankshares, Inc., Triumph Financial, Inc., Live Oak Bancshares, Inc., Merchants Bancorp, The Bancorp, Inc., Cross River Bank, Metropolitan Bank Holding Corp., Capital Community Bank. 3Fintech Peers defined as Atlanticus Holdings Corporation, Oportun Financial Corporation, LendingClub Corporation, Pathward Financial, Inc. Note: Bank level Call Report financial data used where holding company consolidated financials unavailable; 2Q 2025 financial data used where 3Q 2025 holding company consolidated and bank level Call Report financials are unavailable Source: S&P Capital IQ Pro Indexed Change in TBV Since FINW IPO (4Q21) vs Select Bank2 and Fintech Peers3
Industry Recognition as a Top-Performing Bank 20 FinWise Bancorp ranked in top 3 on American Banker's annual list of Top-Performing Publicly Traded Banks with under $2 billion of assets (based on 3-year average ROAE ending 12/31/23) 2022 2023 2022 2023 20242024 Source: https://www.independentbanker.org/article/2024/05/01/icba%27s-best-performing-banks-of-2024; https://www.americanbanker.com/list/the-20-top-performing-publicly-traded-banks-with-under-2b-of-assets FinWise Bancorp ranked #1 in its respective class (for the 3rd year in a row) for Best Performing Banks (based on 3-year average pre-tax ROA) FinWise Bank was ranked as one of the 50 fastest growing companies in Utah based on revenue growth over five years. 2022 2023 2024
Selected Financial Information 21
Solid Originations and Significant Balance Sheet Growth 22 1 HFI = Held for Investment. Note: Total Loan Originations are for the quarterly period. Other amounts are as of the end of each respective period Total Assets at end-of- period 3Q25 reached nearly $900M for the first time in the Company's history.
Growing TBVps and Sustained Historical Profitability 23 1See Appendix for more information and Non-GAAP reconciliation. Tangible Book Value per Share (Non-GAAP) as of the end of each respective period. 2ROAE is negatively affected by high capital levels. Profitability partly impacted by infrastructure investments over the past two years to support organic growth and the build- out of key strategic initiatives. ROAE has also been lower due to high capital levels
Diversified Income Sources 24 1For accounting purposes, Credit Enhancement Income is fully offset by a corresponding credit loss provision related to credit enhanced balances, thus not having a net effect on the Company's net income. 2All Other Non-interest Income includes all other non-interest income items, excluding Strategic Program Fees and Credit Enhancement Income. Net Interest Income and Net Interest Margin (NIM) are impacted by lending activities including growth in the Credit Enhanced portfolio
Disciplined Expense Management While Investing for Growth Increase in Total Non-interest Expense in prior years was been driven largely by business infrastructure spend, including headcount, to support organic growth and key strategic initiatives. Outlook Commentary: Remain focused on positive operating leverage; Expense growth to be correlated to revenue production. NOTE: reported efficiency ratio was 47.6% in 3Q25. Adjusting for credit enhancement related accounting gross ups to net interest income, non-interest income and non-interest expense, the core efficiency ratio was 59.7% for 3Q252 25 3Q24 2Q25 3Q25 Full Time Employees (FTEs) 194 200 194 Efficiency Ratio (Non-GAAP)2 67.5% 59.5% 47.6% 1All Other Non-interest Expense refers to all other expense components within Total Non-interest Expense, excluding Salaries & Employee Benefits and Credit Enhancement Expenses. 2See Appendix at the end of the presentation for Non-GAAP reconciliation
Well Capitalized Above Regulatory Requirements 26 Note: data as of the end of each respective period. Capital levels remain well above the well-capitalized regulatory requirement of 9%, pursuant to the Community Bank Leverage Ratio framework adopted by the Bank in 2020.
Appendix 27
Non-GAAP Reconciliations 28 (1) Tangible shareholders’ equity: This measure is not a measure recognized under GAAP and is therefore considered to be a non-GAAP financial measure. Tangible shareholders’ equity is defined as total shareholders’ equity less goodwill and other intangible assets. The most directly comparable GAAP financial measure is total shareholder’s equity to total assets. The Company had no goodwill or other intangible assets as of any of the dates indicated. The Company has not considered loan servicing rights or loan trailing fee asset as intangible assets for purposes of this calculation. As a result, tangible shareholders’ equity is the same as total shareholders’ equity as of each of the dates indicated. (2) Efficiency Ratio: This measure is not a measure recognized under United States generally accepted accounting principles, or GAAP, and is therefore considered to be a non-GAAP financial measure. The efficiency ratio is defined as total non-interest expense divided by the sum of net interest income and non-interest income. The Company believes this measure is important as an indicator of productivity because it shows the amount of revenue generated for each dollar spent. Tangible Shareholders' Equity and Tangible Book Value Per Share As of ($ in thousands, except per share amounts) September 30, 2025 June 30, 2025 September 30, 2024 Total shareholders' equity $ 187,765 $ 181,959 $ 170,370 Goodwill — — — Other intangibles — — — Less: total intangible assets — — — Tangible shareholders' equity1 $ 187,765 $ 181,959 $ 170,370 Tangible book value per share1 $ 13.84 $ 13.51 $ 12.90 Efficiency Ratio For the Three Month Period Ending ($ in thousands) September 30, 2025 June 30, 2025 September 30, 2024 Non-interest expense $ 17,449 $ 14,912 $ 14,049 Net interest income 18,607 14,728 14,763 Non-interest income 18,052 10,337 6,054 Adjusted operating revenue $ 36,659 $ 25,065 $ 20,817 Efficiency ratio2 47.6 % 59.5 % 67.5 %
Non-GAAP Reconciliations (continued) 29 (3) Adjusted Efficiency Ratio: This measure is not a measure recognized under United States generally accepted accounting principles, or GAAP, and is therefore considered to be a non-GAAP financial measure. The adjusted efficiency ratio is defined as total non-interest expense, adjusted for credit enhancement program expenses, divided by the sum of net interest income and adjusted non-interest income, adjusted for credit enhancement income. Adjusted Efficiency Ratio For the Three Month Period Ending ($ in thousands) September 30, 2025 June 30, 2025 September 30, 2024 Non-interest expense (GAAP) $ 17,449 $ 14,912 $ 14,049 Less: credit enhancement program expenses 1,968 90 3 Adjusted non-interest expense 15,481 14,822 14,046 Net interest income (GAAP) 18,607 14,728 14,763 Less: credit enhancement interest 1,968 90 3 Adjusted net interest income 16,639 14,638 14,760 Total non-interest income (GAAP) 18,052 10,337 6,054 Less: credit enhancement income 8,762 2,275 47 Adjusted non-interest income 9,290 8,062 6,007 Adjusted operating revenue $ 25,929 $ 22,700 $ 20,767 Adjusted efficiency ratio3 59.7 % 65.3 % 67.6 %
Glossary of Terms Used 30 ACH (The Automated Clearing House). Electronic funds-transfer system that facilitates payments in the U.S. and internationally. The ACH is run by Nacha. API (Application Programming Interface). Set of defined rules that enable different applications to communicate with each other. It acts as an intermediary layer that processes data transfers between systems, letting companies open their application data and functionality to external third-party developers, business partners, and internal departments within their companies. Banking-as-a-Service (BaaS). Banking model in which licensed banks integrate their digital banking services directly into the products of other non-bank businesses. This allows non-bank businesses to offer their customers digital banking services such as mobile bank accounts, debit cards, loans and payment services, without needing to acquire a banking license of their own. The bank's system communicates via APIs and webhooks with that of the non-bank's business, enabling the end customer to access banking services directly through the non-bank’s website or app. BIN (Bank Identification Number) Sponsorship. BIN sponsorship allows fintech businesses to quickly gain direct access to the payment processing and card management services provided by the likes of Visa or Mastercard without going through the process of joining a major card scheme. It provides fintechs with quickest way to launch a financial product with a debit, credit or prepaid card attached. Credit Enhanced Balance Sheet. FinWise generates interest income from existing and potential new strategic programs through contractual interest earned on loans maintained on the FinWise balance sheet. Fintech strategic programs using this product are required to hold a deposit account at FinWise against which charge-offs are recovered, and which is trued up monthly post any charge-offs. FedNow. The clearing service for financial institutions to provide immediate end-to-end payments to customers. The key difference between this service and the Fed’s previous system is that FedNow will be online 24/7, processing transactions in real time. HFI (Held for Investment). When a reporting entity holds an originated or purchased loan for which it has the intent and ability to hold for the foreseeable future or to maturity or payoff, the loan should be classified as held-for-investment. Loans held for investment are reported on the balance sheet at their amortized cost basis. HFS (Held for Sale). When a reporting entity originates or purchases a loan with the intent to sell the loan to another entity (e.g., a government sponsored enterprise). Mastercard RPPS (Remote Payment and Presentment Service). Mastercard RPPS optimizes electronic bill payment by connecting banks to billers. It offers a single, reliable connection for electronic payment providers to help with fast & secure consumer bill payments. Mastercard Send. Mastercard’s offering in the real-time personal payments arena. Senders can immediately make “push payments” to bank accounts, mobile wallets, prepaid debit cards, or targeted cash- out locations. The sender can initiate a Mastercard Send transaction with just the recipient’s debit card number. MoneyRailsTM is FinWise's Payments hub, which is a single-window platform through which companies can execute all their payments, and issue virtual cards. MoneyRails also provides the ability to safeguard funds in an array of account types: FBO and subaccounts to satisfy FinTechs’ deposit needs, as well as traditional Savings, Checking, Certificate of Deposits, etc. . Payment hubs increase fund control and visibility, reduce the risk associated with numerous fragmented payment processes, and improve overall operating efficiency. NIM: Net Interest Margin SBA 7(a) loans. Small-business loans issued by a private lender and partially backed by the U.S. Small Business Administration. SMBs. Small to medium-sized businesses. Strategic Program Lending - SPL (sometimes referred as Marketplace Lending). Lending predominately done through fintech platforms that connect borrowers with lenders. TBV: Tangible Book Value The Clearing House RTP. A real-time payments platform that all federally insured U.S. depository institutions are eligible to use for payments innovation. All RTP payments are processed by The Clearing House. When you pay your utility bill for the month using RTP, your bank sends message to network which includes the details of the payment. The Clearing House then processes the message and routes it to utility company's bank, completing the payment. Visa Direct. A type of Original Credit Transaction (OCT) that allows fast and secure payment transfers to customers using their card details. Unlike with other payment methods, where it can typically take up to 24 hours for the funds to be transferred to the customer, Visa Direct transactions normally complete near-instantly.