Q4 2025 FinWise Bancorp Earnings Call

January 29, 2026

Speaker #1: Greetings,

Operator: Greetings, and welcome to the FinWise Bancorp Q4 2025 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. If anyone should require operator assistance, please press star zero on your telephone keypad. Also, note that this conference is being recorded. It is now my pleasure to turn the conference over to Juan Arias. Thank you, and maybe again.

Speaker #1: and welcome to the Finwise Bancorp Fourth Quarter 2025 earnings conference call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation.

Speaker #1: If anyone should require operator assistance, please press star zero on your telephone keypad. Also note that this conference is being recorded. It is now my pleasure to turn the conference over to Juan Arias.

Speaker #1: Thank you. You may begin.

Speaker #2: Good afternoon, and thank you for joining us today for Finwise Bancorp's Fourth Quarter 2025 earnings conference call. Earlier today, we filed our earnings release and investor deck and posted them to our investor website at investors.finwisebancorp.com.

Operator: Good afternoon, and thank you for joining us today for FinWise Bancorp's Q4 2025 earnings conference call. Earlier today, we filed our earnings release and investor deck and posted them to our investor website at investors.finwisebancorp.com. Today's conference call is being recorded and webcast on the company's investor website, as previously mentioned. On today's call, management's prepared remarks and answers to your questions may contain forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ from those discussed today. Forward-looking statements represent management's current estimates, expectations, and beliefs, and FinWise Bancorp assumes no obligation to update any forward-looking statements in the future. We encourage listeners to review the more detailed discussions related to these forward-looking statements, including factors that may negatively impact them, contained in the company's earnings press release and filings with the Securities and Exchange Commission.

Q4 2025 FinWise Bancorp Earnings Call

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FINW

Finwise Bancorp

Earnings

Q4 2025 FinWise Bancorp Earnings Call

FINW

Thursday, January 29th, 2026 at 10:00 PM

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Juan Arias: Good afternoon, and thank you for joining us today for FinWise Bancorp's Q4 2025 earnings conference call. Earlier today, we filed our earnings release and investor deck and posted them to our investor website at investors.finwisebancorp.com. Today's conference call is being recorded and webcast on the company's investor website, as previously mentioned. On today's call, management's prepared remarks and answers to your questions may contain forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ from those discussed today. Forward-looking statements represent management's current estimates, expectations, and beliefs, and FinWise Bancorp assumes no obligation to update any forward-looking statements in the future. We encourage listeners to review the more detailed discussions related to these forward-looking statements, including factors that may negatively impact them, contained in the company's earnings press release and filings with the Securities and Exchange Commission.

Speaker #2: Today's conference call is being recorded and webcast on the company's investor website as previously mentioned. On today's call, management's prepared remarks and answers to your questions may contain forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ from those discussed today.

Speaker #2: Forward-looking statements represent management's current estimates and expectations and beliefs and Finwise Bancorp assumes no obligation to update any forward-looking statements in the future. We encourage listeners to review the more detailed discussions related to these forward-looking statements including factors that may negatively impact them contained in the company's earnings press release and filings with the securities and exchange commission.

Speaker #2: Posting the call today are Kent Landvatter, Chairman and CEO; Jim Noone, Bank CEO; and Bob Wallman, CFO. Kent, please go

Operator: Hosting the call today are Kent Landvatter, Chairman and CEO, Jim Noone, Bank CEO, and Bob Wahlman, CFO. Kent, please go ahead.

Hosting the call today are Kent Landvatter, Chairman and CEO, Jim Noone, Bank CEO, and Bob Wahlman, CFO. Kent, please go ahead.

Speaker #2: ahead. Good afternoon,

Kent Landvatter: Good afternoon, everyone. FinWise delivered a strong 2025, growing net income 26% and posting a steady fourth quarter that demonstrates how our multi-year investments are gradually translating into tangible, sustainable results. The meaningful progress we've made in expanding and diversifying our revenue streams underscores both the durability of our business model and the momentum behind our long-term strategy. Specifically, during the fourth quarter, we delivered healthy revenue growth driven by balanced contributions from both fee and spread income. Additionally, our disciplined approach to expense management further strengthened profitability and supported continued growth in tangible book value per share, reinforcing the long-term value we are delivering to shareholders. Loan originations totaled a solid $1.6 billion in the fourth quarter, exceeding our initial guidance of $1.4 billion. This brings full-year 2025 originations to $6.1 billion, representing a healthy 22% year-over-year growth.

Speaker #3: everyone. Finwise delivered a strong 2025 growing net income 26% and posting a steady fourth quarter that demonstrates how our multi-year investments are gradually translating into tangible sustainable results.

Speaker #3: The meaningful progress we've made in expanding and diversifying our revenue streams underscores both the durability of our business model and the momentum behind our long-term strategy.

Speaker #3: Specifically, during the fourth quarter, we delivered healthy revenue growth driven by balanced contributions from both fee and spread income. Additionally, our disciplined approach to expense management further strengthened profitability and supported continued growth in tangible book value per share, reinforcing the long-term value we are delivering to shareholders.

Speaker #3: Loan originations totaled a solid $1.6 billion in the fourth quarter, exceeding our initial guidance of $1.4 billion. This brings full-year 2025 originations to $6.1 billion, representing a healthy 22% year-over-year growth.

Speaker #3: Key drivers during the fourth quarter included strong originations from established partners and continued ramp in the maturation of programs launched in recent years. Partly offsetting this was the expected seasonal deceleration from our largest student lending partner.

Kent Landvatter: Key drivers during the fourth quarter included strong originations from established partners and continued ramp in the maturation of programs launched in recent years. Partly offsetting this was the expected seasonal deceleration from our largest student lending partner. While quarterly loan originations will fluctuate with typical seasonality in certain quarters, we believe we have reached a higher and more sustainable level of quarterly production, supported by robust contributions from long-standing partners and newer relationships that continue to scale. We also experienced strong uptake of our credit-enhanced product, ending the quarter with balances of $118 million, exceeding both the $115 million outlook provided on our third-quarter earnings call and our initial guidance of $50 to $100 million. This product is a core component of our lower-risk asset growth strategy, supported by a structure that requires fintech partners to maintain a deposit account at FinWise, against which charge-offs are recovered.

Key drivers during the fourth quarter included strong originations from established partners and continued ramp in the maturation of programs launched in recent years. Partly offsetting this was the expected seasonal deceleration from our largest student lending partner. While quarterly loan originations will fluctuate with typical seasonality in certain quarters, we believe we have reached a higher and more sustainable level of quarterly production, supported by robust contributions from long-standing partners and newer relationships that continue to scale. We also experienced strong uptake of our credit-enhanced product, ending the quarter with balances of $118 million, exceeding both the $115 million outlook provided on our third-quarter earnings call and our initial guidance of $50 to $100 million. This product is a core component of our lower-risk asset growth strategy, supported by a structure that requires fintech partners to maintain a deposit account at FinWise, against which charge-offs are recovered.

Speaker #3: While quarterly loan originations will fluctuate with typical seasonality in certain quarters, we believe we have reached a higher and more sustainable level of quarterly production, supported by robust contributions from longstanding partners and newer relationships that continue to scale.

Speaker #3: We also experienced strong uptake of our credit-enhanced product, ending the quarter with balances of $118 million exceeding both the $115 million outlook provided on our third quarter earnings call and our initial guidance of $50 to $100 million.

Speaker #3: This product is a core component of our lower-risk asset growth strategy, supported by a structure that requires fintech partners to maintain a positive account at Finwise, against which charge-offs are recovered.

Speaker #3: Turning to our BIN and payments business, although ramp-up has been more measured than we initially anticipated, we remain confident in the long-term value proposition.

Kent Landvatter: Turning to our BIN and payments business, although ramp-up has been more measured than we initially anticipated, we remain confident in the long-term value proposition. Integrating these capabilities under one roof enhances our ability to win new partners, expand cross-sell opportunities, and deepen strategic relationships over time. While strategic partnerships with a lending focus remain our most profitable relationships, we are generating increased interest by also offering BIN and payment solutions. For example, some clients use our award-winning payments optimizer, MoneyRails, to process salary deduction repayments on FinWise-originated loans, while others are leveraging MoneyRails to fund transactions through RTP and FedNow, demonstrating the expanding utility and appeal of the platform. Ultimately, these ancillary services enable our partners to innovate faster, operate more efficiently, and compete more effectively, reinforcing FinWise as a true strategic partner, not just a regulatory gateway.

Turning to our BIN and payments business, although ramp-up has been more measured than we initially anticipated, we remain confident in the long-term value proposition. Integrating these capabilities under one roof enhances our ability to win new partners, expand cross-sell opportunities, and deepen strategic relationships over time. While strategic partnerships with a lending focus remain our most profitable relationships, we are generating increased interest by also offering BIN and payment solutions. For example, some clients use our award-winning payments optimizer, MoneyRails, to process salary deduction repayments on FinWise-originated loans, while others are leveraging MoneyRails to fund transactions through RTP and FedNow, demonstrating the expanding utility and appeal of the platform. Ultimately, these ancillary services enable our partners to innovate faster, operate more efficiently, and compete more effectively, reinforcing FinWise as a true strategic partner, not just a regulatory gateway.

Speaker #3: Integrating these capabilities under one roof enhances our ability to win new partners and expand cross-sell opportunities and deepen strategic relationships over time. While strategic partnerships with the lending focus remain our most profitable relationships, we are generating increased interest by also offering BIN and payment solutions.

Speaker #3: For example, some clients use our award-winning payments optimizer, Money Rails, to process salary deduction repayments on FinWise-originated loans, while others are leveraging Money Rails to fund transactions through RTP and FedNow, demonstrating the expanding utility and appeal of the platform.

Speaker #3: Ultimately, these ancillary services enable our partners to innovate faster, operate more efficiently, and compete more effectively, reinforcing Finwise as a true strategic partner, not just a regulatory gateway.

Speaker #3: We are also pleased to share that DreamFi, a strategic program agreement we announced last quarter, has officially launched. DreamFi is a startup financial technology company that will provide financial products and services to underbanked communities.

Kent Landvatter: We are also pleased to share that DreamFi, a strategic program agreement we announced last quarter, has officially launched. DreamFi is a startup financial technology company that will provide financial products and services to underbanked communities. Overall, our pipeline remains healthy, and we remain in active discussions with several additional prospects. As we've mentioned before, the pace of new agreements can appear lumpy, and timing may fluctuate, particularly with larger strategic opportunities. That said, each strategic partnership we secure has the potential to create outsized value. Under this one-to-many framework, a single partnership can drive substantial growth in portfolio balances and revenue, underscoring the inherent scalability and strength of our platform. On the AI front, given the high cost and rapid pace of change associated with early-stage AI development, a disciplined adoption approach remains the most effective strategy for FinWise.

We are also pleased to share that DreamFi, a strategic program agreement we announced last quarter, has officially launched. DreamFi is a startup financial technology company that will provide financial products and services to underbanked communities. Overall, our pipeline remains healthy, and we remain in active discussions with several additional prospects. As we've mentioned before, the pace of new agreements can appear lumpy, and timing may fluctuate, particularly with larger strategic opportunities. That said, each strategic partnership we secure has the potential to create outsized value. Under this one-to-many framework, a single partnership can drive substantial growth in portfolio balances and revenue, underscoring the inherent scalability and strength of our platform. On the AI front, given the high cost and rapid pace of change associated with early-stage AI development, a disciplined adoption approach remains the most effective strategy for FinWise.

Speaker #3: Overall, our pipeline remains healthy and we remain an active discussion with several additional prospects. As we've mentioned before, the pace of new agreements can appear lumpy and timing may fluctuate, particularly with larger strategic opportunities.

Speaker #3: That said, each strategic partnership we secure has the potential to create outsized value. Under this one-to-many framework, a single partnership can drive substantial growth in portfolio balances and revenue.

Speaker #3: Underscoring the inherent scalability and strength of our platform. On the AI front, given the high cost and rapid pace of change associated with early-stage AI development, a disciplined adoption approach remains the most effective strategy for Finwise.

Speaker #3: While we have already been using AI in areas such as coding, quality assurance, and BSA AML, the advances in generative AI are opening new opportunities for efficiency and automation.

Kent Landvatter: While we have already been using AI in areas such as coding, quality assurance, and BSA/AML, the advances in generative AI are opening new opportunities for efficiency and automation. We are actively exploring opportunities to broaden the deployment of these capabilities across a company to drive efficiency and long-term value, with a disciplined focus on safeguarding sensitive data through secure and controlled implementation. Lastly, while we will be disciplined in managing near-term performance, our priority remains building durable long-term growth by pursuing opportunities that significantly enhance the company's future. We are confident in the outlook ahead and in our ability to deliver lasting value for our customers and shareholders. With that, let me turn the call over to Jim Noone, our bank CEO.

While we have already been using AI in areas such as coding, quality assurance, and BSA/AML, the advances in generative AI are opening new opportunities for efficiency and automation. We are actively exploring opportunities to broaden the deployment of these capabilities across a company to drive efficiency and long-term value, with a disciplined focus on safeguarding sensitive data through secure and controlled implementation. Lastly, while we will be disciplined in managing near-term performance, our priority remains building durable long-term growth by pursuing opportunities that significantly enhance the company's future. We are confident in the outlook ahead and in our ability to deliver lasting value for our customers and shareholders. With that, let me turn the call over to Jim Noone, our bank CEO.

Speaker #3: We are actively exploring opportunities to broaden the deployment of these capabilities across the company to drive efficiency and long-term value, with a disciplined focus on safeguarding sensitive data through secure and controlled implementation.

Speaker #3: Lastly, while we will be disciplined in managing near-term performance, our priority remains building durable, long-term growth by pursuing opportunities that significantly enhance the company's future.

Speaker #3: We are confident in the outlook ahead and in our ability to deliver lasting value for our customers and shareholders. With that, let me turn the call over to Jim Noone, our bank CEO.

Speaker #2: Thank you, Kent. I'll shift now to provide an update on our credit quality and our SBA business. Overall, credit trends remain stable with performance aligning with our expectations.

Jim Noone: Thank you, Kent. I'll shift now to provide an update on our credit quality and our SBA business. Overall, credit trends remain stable, with performance aligning with our expectations, and we remain disciplined and proactive in managing the portfolio. On the SBA side, production pipelines remain healthy, secondary market premiums continue to be attractive, and we're executing operationally to support continued growth. Specifically, during the quarter, we further refined our servicing and administrative standards, which resulted in accelerated classification of certain loans to non-performing status and earlier recognition of related charge-offs. As part of this refinement, we increased borrower thresholds required to qualify for a one-time short-term deferment. Management views these adjustments as a prudent, forward-looking enhancement to our risk management framework. Our portfolio continues to be strong and exhibits good performance. Quarterly net charge-offs were $6.7 million in Q4, compared to $3.1 million in the prior quarter.

Speaker #2: We remain disciplined and proactive in managing the portfolio. On the SBA side, production pipelines remain healthy, secondary market premiums continue to be attractive, and we're executing operationally to support continued growth.

Speaker #2: Specifically, during the quarter, we further refined our servicing and administrative standards. Which resulted in accelerated classification of certain loans to non-performing status, and earlier recognition of related charge-offs.

Speaker #2: As part of this refinement, we increased borrower thresholds required to qualify for a one-time short-term deferment. Management views these adjustments as a prudent, forward-looking enhancement to our risk management framework.

Speaker #2: Our portfolio continues to be strong, and exhibits good performance. Quarterly net charge-offs were $6.7 million in Q4, compared to $3.1 million in the prior quarter.

Speaker #2: $1.5 million of the total NCOs were attributable to our credit-enhanced balance sheet program. However, these losses are guaranteed and FinWise is reimbursed for any losses from the cash reserve each partner is required to maintain at FinWise.

Jim Noone: $1.5 million of the total NCOs were attributable to our credit-enhanced balance sheet program. However, these losses are guaranteed, and FinWise is reimbursed for any losses from the cash reserve each partner is required to maintain at FinWise. Of the remaining $5.2 million in NCOs, $1.2 million was due to the updated servicing standards that we implemented in the quarter. Provision for loan losses were $17.7 million for the fourth quarter, compared to $12.8 million for the prior quarter. The increase was driven primarily by growth in the credit-enhanced loan portfolio, as well as higher net charge-offs resulting from our updated servicing standards, which led to the accelerated classification of non-performing loans and charge-offs.

$1.5 million of the total NCOs were attributable to our credit-enhanced balance sheet program. However, these losses are guaranteed, and FinWise is reimbursed for any losses from the cash reserve each partner is required to maintain at FinWise. Of the remaining $5.2 million in NCOs, $1.2 million was due to the updated servicing standards that we implemented in the quarter. Provision for loan losses were $17.7 million for the fourth quarter, compared to $12.8 million for the prior quarter. The increase was driven primarily by growth in the credit-enhanced loan portfolio, as well as higher net charge-offs resulting from our updated servicing standards, which led to the accelerated classification of non-performing loans and charge-offs.

Speaker #2: Of the remaining $5.2 million in NCOs, $1.2 million was due to the updated servicing standards that we implemented in the quarter. Provision for loan losses was $17.7 million for the fourth quarter.

Speaker #2: Compared to $12.8 million for the prior quarter, the increase was driven primarily by growth in the credit-enhanced loan portfolio, as well as higher net charge-offs resulting from our updated servicing standards.

Speaker #2: Which led to the accelerated classification of non-performing loans and charge-offs. As a reminder, the provision for credit losses associated with the credit-enhanced loan portfolio is different from the core portfolio provision.

Jim Noone: As a reminder, the provision for credit losses associated with the credit-enhanced loan portfolio is different from the core portfolio provision because it's fully offset by the recognition of future recoveries, pursuant to the partner guarantee described as credit enhancement income in our non-interest income. This quarter, we included a new table in the earnings press release that breaks out the total provision between the core portfolio and the credit-enhanced portfolio. Positively, during Q4, the net increase to our NPL balance was less than $1 million, bringing our total NPL balance to $43.7 million at the end of the quarter. This modest increase was mostly due to SBA 7(a) watchlist and special mention loans migrating to classified status. In comparison to our guidance on our prior call, the $10 to $12 million in balances could migrate to NPL during Q4.

As a reminder, the provision for credit losses associated with the credit-enhanced loan portfolio is different from the core portfolio provision because it's fully offset by the recognition of future recoveries, pursuant to the partner guarantee described as credit enhancement income in our non-interest income. This quarter, we included a new table in the earnings press release that breaks out the total provision between the core portfolio and the credit-enhanced portfolio. Positively, during Q4, the net increase to our NPL balance was less than $1 million, bringing our total NPL balance to $43.7 million at the end of the quarter. This modest increase was mostly due to SBA 7(a) watchlist and special mention loans migrating to classified status. In comparison to our guidance on our prior call, the $10 to $12 million in balances could migrate to NPL during Q4.

Speaker #2: Because it's fully offset by the recognition of future recoveries. Pursuant to the partner guarantee, described as credit enhancement income in our non-interest income. This quarter, we included a new table in the earnings press release that breaks out the total provision between the core portfolio and the credit-enhanced portfolio.

Speaker #2: Positively, during Q4, the net increase to our NPL balance was less than $1 million, bringing our total NPL balance to $43.7 million at the end of the quarter.

Speaker #2: This modest increase was mostly due to SBA 7A watch list and special mention loans migrating to classified status. In comparison to our guidance on our prior call, the 10 to 12 million dollars in balances could migrate to NPL during Q4.

Speaker #2: The lower than potential migration reflects the team's proactive efforts in disposing of collateral securing NPLs. Of the $43.7 million in total NPL balances, 24.2 million or $55% is guaranteed by the federal government.

Jim Noone: The lower-than-potential migration reflects the team's proactive efforts in disposing of collateral securing NPLs. Of the $43.7 million in total NPL balances, $24.2 million, or 55%, is guaranteed by the federal government, and $19.5 million is unguaranteed. Quarterly, SBA 7(a) loan originations decreased quarter-over-quarter, primarily due to extended SBA processing delays resulting from staffing cuts at the SBA, with additional impact from the government shutdown. During the quarter, we took advantage of attractive secondary market premiums to increase sales of the guaranteed portion of our SBA loans, particularly after the government's reopening in November, which contributed to elevated gain-on-sale income. We will continue to follow our strategy of selling guaranteed portions of our SBA loans as long as market conditions remain favorable. Following the government's reopening in late November, the environment for SBA loan originations has normalized, with turnaround times returning to more typical levels.

The lower-than-potential migration reflects the team's proactive efforts in disposing of collateral securing NPLs. Of the $43.7 million in total NPL balances, $24.2 million, or 55%, is guaranteed by the federal government, and $19.5 million is unguaranteed. Quarterly, SBA 7(a) loan originations decreased quarter-over-quarter, primarily due to extended SBA processing delays resulting from staffing cuts at the SBA, with additional impact from the government shutdown. During the quarter, we took advantage of attractive secondary market premiums to increase sales of the guaranteed portion of our SBA loans, particularly after the government's reopening in November, which contributed to elevated gain-on-sale income. We will continue to follow our strategy of selling guaranteed portions of our SBA loans as long as market conditions remain favorable. Following the government's reopening in late November, the environment for SBA loan originations has normalized, with turnaround times returning to more typical levels.

Speaker #2: And $19.5 million is unguaranteed. Quarterly, SBA 7(a) loan originations decreased quarter over quarter, primarily due to extended SBA processing delays resulting from staffing cuts at the SBA.

Speaker #2: With additional impact from the government shutdown. During the quarter, we took advantage of attractive secondary market premiums to increase sales of the guaranteed portion of our SBA loans.

Speaker #2: Particularly after the government's reopening in November, which contributed to elevated gain on sale income. We will continue to follow our strategy of selling guaranteed portions of our SBA loans as long as market conditions remain favorable.

Speaker #2: Following the government's reopening in late November, the environment for SBA loan originations has normalized. With turnaround times returning to more typical levels. Notably, our SBA guaranteed balances and strategic program loans held for sale—both of which carry lower credit risk—collectively accounted for 34% of the total portfolio at the end of Q4.

Jim Noone: Notably, our SBA guaranteed balances and strategic program loans held for sale, both of which carry lower credit risk, collectively accounted for 34% of the total portfolio at the end of Q4, underscoring the lower-risk composition of our loan book. I will now turn the call over to our CFO, Bob Wahlman, to provide more detail on our financial results.

Notably, our SBA guaranteed balances and strategic program loans held for sale, both of which carry lower credit risk, collectively accounted for 34% of the total portfolio at the end of Q4, underscoring the lower-risk composition of our loan book. I will now turn the call over to our CFO, Bob Wahlman, to provide more detail on our financial results.

Speaker #2: Underscoring the lower risk composition of our loan book. I will now turn the call over to our CFO, Bob Wallman, to provide more detail on our financial

Speaker #2: Underscoring the lower-risk composition of our loan book. I will now turn the call over to our CFO, Robert Wahlman, to provide more detail on our financial results.

Speaker #3: Thanks, Jim. And good afternoon, everyone. Finwise reported net income of $3.9 million for the fourth quarter and diluted earnings per share of $27. Key drivers during the fourth quarter included a notable increase in loan originations and a significant rise in credit-enhanced balances.

Kent Landvatter: Thanks, Jim, and good afternoon, everyone. FinWise reported net income of $3.9 million for the fourth quarter and diluted earnings per share of $0.27. Key drivers during the fourth quarter included a notable increase in loan originations and a significant rise in credit-enhanced balances, both greater than our expectations. Fourth-quarter results were also impacted by an increase in net charge-offs, in part stemming from the previously mentioned refinement of our servicing and administration standards. The higher net charge-offs resulted in a higher provision for credit losses on our traditional banking portfolio, which negatively impacted our Q4 net income by $1.1 million after taxes. Net interest income grew to $24.6 million from the prior quarter's $18.6 million, primarily due to the increase in the bank's credit-enhanced balances in the held-for-investment portfolio of $76.5 million. The credit-enhanced loans carry a higher contractual interest rate.

Bob Wahlman: Thanks, Jim, and good afternoon, everyone. FinWise reported net income of $3.9 million for the fourth quarter and diluted earnings per share of $0.27. Key drivers during the fourth quarter included a notable increase in loan originations and a significant rise in credit-enhanced balances, both greater than our expectations. Fourth-quarter results were also impacted by an increase in net charge-offs, in part stemming from the previously mentioned refinement of our servicing and administration standards. The higher net charge-offs resulted in a higher provision for credit losses on our traditional banking portfolio, which negatively impacted our Q4 net income by $1.1 million after taxes. Net interest income grew to $24.6 million from the prior quarter's $18.6 million, primarily due to the increase in the bank's credit-enhanced balances in the held-for-investment portfolio of $76.5 million. The credit-enhanced loans carry a higher contractual interest rate.

Speaker #3: Both greater than our expectations. Fourth quarter results were also impacted by an increase in net charge-offs in part stemming from the previously mentioned refinement of our servicing and administration standards.

Speaker #3: The higher net charge-offs resulted in a higher provision for credit losses on our traditional banking portfolio, which negatively impacted our Q4 net income by $1.1 million after taxes.

Speaker #3: Net interest income grew to $24.6 million from the prior quarter's $18.6 million, primarily due to the increase in the bank's credit-enhanced balances in the held-for-investment portfolio of $76.5 million.

Speaker #3: The credit-enhanced loans carry a higher contractual interest rate. The higher interest income is partly offset by higher average balances in the certificates of deposits used to fund the loan portfolio growth.

Kent Landvatter: The higher interest income is partly offset by higher average balances in the certificates of deposit used to fund the loan portfolio growth. Net interest margin increased to 11.42% compared to 9.01% in the prior quarter. The increase is largely attributable to the credit-enhanced portfolio growth of $76.5 million. As a reminder, we suggest thinking about our net interest margin in two distinct ways, including and excluding excess credit-enhanced income. When including excess credit-enhanced income, we anticipate the margin to increase, supported by the continued expansion of our credit-enhanced loan portfolio and strategic efforts to lower our cost of funding. Conversely, excluding excess credit-enhanced income, we anticipate a gradual decline in margin consistent with our ongoing risk-reduction strategy. The effect of the credit-enhanced income on net interest margin is included in our gap-to-non-gap disclosures at the end of the earnings release.

The higher interest income is partly offset by higher average balances in the certificates of deposit used to fund the loan portfolio growth. Net interest margin increased to 11.42% compared to 9.01% in the prior quarter. The increase is largely attributable to the credit-enhanced portfolio growth of $76.5 million. As a reminder, we suggest thinking about our net interest margin in two distinct ways, including and excluding excess credit-enhanced income. When including excess credit-enhanced income, we anticipate the margin to increase, supported by the continued expansion of our credit-enhanced loan portfolio and strategic efforts to lower our cost of funding. Conversely, excluding excess credit-enhanced income, we anticipate a gradual decline in margin consistent with our ongoing risk-reduction strategy. The effect of the credit-enhanced income on net interest margin is included in our gap-to-non-gap disclosures at the end of the earnings release.

Speaker #3: Net interest margin increased to 11.42% compared to 9.01% in the prior quarter. The increase is largely attributable to the credit-enhanced portfolio growth of $76.5 million.

Speaker #3: As a reminder, we suggest thinking about our net interest margin in two distinct ways. Including an excluding excess credit-enhanced income. When including excess credit-enhanced income, we anticipate the margin to increase, supported by the continued expansion of our credit-enhanced loan portfolio and strategic efforts to lower our cost of funding.

Speaker #3: Conversely, excluding excess credit-enhanced income, we anticipate a gradual decline in margin, consistent with our ongoing risk reduction strategy. The effect of the credit-enhanced income on net interest margin is included in our GAAP to non-GAAP disclosures at the end of the earnings release.

Speaker #3: We also posted solid non-interest income of $22.3 million compared to the prior quarter's $18.0 million. The growth was primarily due to increases in credit-enhancement income driven by our higher credit-enhanced loan balances outstanding at year-end 2025.

Kent Landvatter: We also posted solid non-interest income of $22.3 million compared to the prior quarter's $18 million. The growth was primarily due to increases in Credit-Enhancement income driven by our higher Credit-Enhanced loan balances outstanding at year-end 2025. Partly offsetting the rise in non-interest income was a decrease in strategic program fees due to lower origination volumes. As a reminder, Credit-Enhancement income offsets the provision for credit losses on Credit-Enhanced loans dollar for dollar. As a result, when the provision expense and the Credit-Enhancement income are considered together, they offset and result in no effect on our profitability. Non-interest expense was $23.7 million compared to $17.4 million in the prior quarter, primarily due to increases in Credit-Enhancement guarantee and servicing expenses resulting from the growth in Credit-Enhanced loan portfolio.

We also posted solid non-interest income of $22.3 million compared to the prior quarter's $18 million. The growth was primarily due to increases in Credit-Enhancement income driven by our higher Credit-Enhanced loan balances outstanding at year-end 2025. Partly offsetting the rise in non-interest income was a decrease in strategic program fees due to lower origination volumes. As a reminder, Credit-Enhancement income offsets the provision for credit losses on Credit-Enhanced loans dollar for dollar. As a result, when the provision expense and the Credit-Enhancement income are considered together, they offset and result in no effect on our profitability. Non-interest expense was $23.7 million compared to $17.4 million in the prior quarter, primarily due to increases in Credit-Enhancement guarantee and servicing expenses resulting from the growth in Credit-Enhanced loan portfolio.

Speaker #3: Partly offsetting the rise in non-interest income was a decrease in strategic program fees due to lower origination volumes. As a reminder, credit-enhancement income offsets the provision for credit losses on credit-enhanced loans dollar for dollar.

Speaker #3: As a result, when the provision expands and the credit-enhancement income are considered together, they offset and result in no effect on our profitability. Non-interest expense was $23.7 million compared to $17.4 million in the prior quarter.

Speaker #3: Primarily due to increases in credit-enhancement guarantee and servicing expenses. Resulting from the growth in credit-enhanced loan portfolio. As a reminder, credit-enhancement guarantee and servicing expenses are amounts Finwise owes to the strategic partners with credit-enhanced programs for their servicing and guarantee activities.

Kent Landvatter: As a reminder, credit-enhancement guarantee and servicing expenses are amounts FinWise owes to the strategic partners with credit-enhanced programs for their servicing and guarantee activities. The reported efficiency ratio for the quarter was 50.5% versus 47.6% in the prior quarter. Importantly, we continue to generate solid balance sheet growth, with total end-of-period assets reaching $977 million. The increase is primarily due to continued growth in the company's cash balances deposited at the Fed, loans held for investment, and an increase in the credit-enhancement asset. Average interest-bearing deposits were $567.4 million compared to $523.9 million in the prior quarter. The increase was primarily in certificates of deposit, which were added to fund loan growth, and an increase in non-interest-bearing demand deposits, primarily related to collateral deposits by certain strategic programs that anticipated increased volumes due to typical seasonality in student loan funding in January 2026, which increased our balance sheet liquidity.

As a reminder, credit-enhancement guarantee and servicing expenses are amounts FinWise owes to the strategic partners with credit-enhanced programs for their servicing and guarantee activities. The reported efficiency ratio for the quarter was 50.5% versus 47.6% in the prior quarter. Importantly, we continue to generate solid balance sheet growth, with total end-of-period assets reaching $977 million. The increase is primarily due to continued growth in the company's cash balances deposited at the Fed, loans held for investment, and an increase in the credit-enhancement asset. Average interest-bearing deposits were $567.4 million compared to $523.9 million in the prior quarter. The increase was primarily in certificates of deposit, which were added to fund loan growth, and an increase in non-interest-bearing demand deposits, primarily related to collateral deposits by certain strategic programs that anticipated increased volumes due to typical seasonality in student loan funding in January 2026, which increased our balance sheet liquidity.

Speaker #3: The reported efficiency ratio for the quarter was 50.5% versus 47.6% in the prior quarter. Importantly, we continue to generate solid balance sheet growth with total end-of-period assets reaching $977 million.

Speaker #3: The increase was primarily due to continued growth in the company's cash balances deposited at the Fed, loans held for investment, and an increase in the credit-enhancement asset.

Speaker #3: Average interest-bearing deposits were $567.4 million, compared to $523.9 million in the prior quarter. The increase was primarily in certificates of deposit, which were added to fund loan growth.

Speaker #3: And an increase in non-interest-bearing demand deposits, primarily related to collateral deposits by certain strategic programs that anticipated increased volumes due to typical seasonality in student loan fundings in January 2026.

Speaker #3: Which increased our balance sheet liquidity. Let me provide forward outlook on some key metrics as we've done in prior quarters. Loan originations for Q1 2026.

Kent Landvatter: Let me provide forward outlook on some key metrics, as we've done in prior quarters. Loan originations for Q1, 2026. Originations through the first four weeks of January are tracking at a quarterly run rate of approximately $1.4 billion. Loan originations for full year 2026. We remain comfortable using $1.4 billion in quarterly originations as our baseline, as it normalizes for student lending seasonality. Annualizing this level and applying a 5% growth rate provides a reasonable outlook for originations for full year 2026. Credit-enhanced balances for full year 2026. We remain comfortable with organic growth in credit-enhanced balances of $8 to $10 million on average per month for 2026, but could see some variability between months. SBA loan sales. While we don't provide a specific outlook, we will continue to follow our strategy of selling guaranteed portions of our SBA loans as long as market conditions remain favorable.

Let me provide forward outlook on some key metrics, as we've done in prior quarters. Loan originations for Q1, 2026. Originations through the first four weeks of January are tracking at a quarterly run rate of approximately $1.4 billion. Loan originations for full year 2026. We remain comfortable using $1.4 billion in quarterly originations as our baseline, as it normalizes for student lending seasonality. Annualizing this level and applying a 5% growth rate provides a reasonable outlook for originations for full year 2026. Credit-enhanced balances for full year 2026. We remain comfortable with organic growth in credit-enhanced balances of $8 to $10 million on average per month for 2026, but could see some variability between months. SBA loan sales. While we don't provide a specific outlook, we will continue to follow our strategy of selling guaranteed portions of our SBA loans as long as market conditions remain favorable.

Speaker #3: Originations through the first four weeks of January are tracking at a quarterly run rate of approximately $1.4 billion. Loan originations for full year 2026.

Speaker #3: We remain comfortable using 1.4 billion in quarterly originations as our baseline, as it normalizes for student lending seasonality. Annualizing this level and applying a 5% growth rate provides a reasonable outlook for originations for full year 2026.

Speaker #3: Credit-enhanced balances for full year 2026. We remain comfortable with organic growth in credit-enhanced balances of $8 to $10 million on average per month for 2026, but could see some variability between months.

Speaker #3: SBA loan sales. While we don't provide a specific outlook, we will continue to follow our strategy of selling guaranteed portions of our SBA loans as long as market conditions remain favorable.

Speaker #3: Quarterly net charge-offs. We anticipate that approximately 3.5 million in net charge-offs for our non-credit-enhanced loans is a good quarterly number to use in your models.

Kent Landvatter: Quarterly net charge-offs. We anticipate that approximately $3.5 million in net charge-offs for our non-credit-enhanced loans is a good quarterly number to use in your models. Non-performing loan balances for Q1, 2026. We think there is potentially as much as $10 million in watchlist loans that could migrate to NPL in Q1, 2026. We continue to expect a gradual moderation in NPL migration as loans underwritten in lower interest rate environments continue to season, though the migration may be lumpy. Net interest margin. We remain comfortable with our prior outlook that when including credit-enhanced balances, the margin is projected to increase, supported by the continued expansion of our credit-enhanced loan portfolio and strategic efforts to lower our cost of funding. This upward trend is expected to persist until growth in these balances begins to moderate.

Quarterly net charge-offs. We anticipate that approximately $3.5 million in net charge-offs for our non-credit-enhanced loans is a good quarterly number to use in your models. Non-performing loan balances for Q1, 2026. We think there is potentially as much as $10 million in watchlist loans that could migrate to NPL in Q1, 2026. We continue to expect a gradual moderation in NPL migration as loans underwritten in lower interest rate environments continue to season, though the migration may be lumpy. Net interest margin. We remain comfortable with our prior outlook that when including credit-enhanced balances, the margin is projected to increase, supported by the continued expansion of our credit-enhanced loan portfolio and strategic efforts to lower our cost of funding. This upward trend is expected to persist until growth in these balances begins to moderate.

Speaker #3: Non-performing loan balances for Q1 ’26. We think there is potentially as much as $10 million in watchlist loans that could migrate to NPL in Q1 ’26.

Speaker #3: We continue to expect a gradual moderation in NPL migration as loans underwritten in lower interest rate environments continue to season though the migration may be lumpy.

Speaker #3: Net interest margin. We remain comfortable with our prior outlook that when including credit-enhanced balances the margin is projected to increase. Supported by the continued expansion of our credit-enhanced loan portfolio and strategic efforts to lower our cost of funding.

Speaker #3: This upward trend is expected to persist until growth in these balances begins to moderate. Conversely, excluding excess credit-enhanced income, we anticipate a gradual decline in margin consistent with our ongoing risk reduction strategy.

Kent Landvatter: Conversely, excluding excess credit-enhanced income, we anticipate a gradual decline in margin consistent with our ongoing risk-reduction strategy. Efficiency ratio. We remain focused on driving sustainable positive operating leverage, with a long-term goal of steadily lowering our core efficiency ratio. That said, there may be periods in which the efficiency ratio may rise. Tax rate. While multiple factors may influence the actual tax rate, we suggest using 26% in your modeling. With that, we would like to open the call for Q&A. Operator.

Conversely, excluding excess credit-enhanced income, we anticipate a gradual decline in margin consistent with our ongoing risk-reduction strategy. Efficiency ratio. We remain focused on driving sustainable positive operating leverage, with a long-term goal of steadily lowering our core efficiency ratio. That said, there may be periods in which the efficiency ratio may rise. Tax rate. While multiple factors may influence the actual tax rate, we suggest using 26% in your modeling. With that, we would like to open the call for Q&A. Operator.

Speaker #3: Efficiency ratio. We remain focused on driving sustainable, positive operating leverage, with a long-term goal of steadily lowering our core efficiency ratio. That said, there may be periods in which the efficiency ratio may rise.

Speaker #3: Tax rate. While multiple factors may influence the actual tax rate, we suggest using 26% in your modeling. With that, we would like to open the call for Q&A.

Speaker #3: Operator?

Speaker #2: Thank you. And with that, we will now be conducting a question and answer session. If you'd like to ask a question, please press star one on your telephone keypad.

Jim Noone: Thank you. And with that, we will now be conducting a question-and-answer session. If you'd like to ask a question, please press Star 1 on your telephone keypad. Confirmation tone will indicate that your line is in the question queue. You may press Star 2 to remove yourself from the queue. For any participants using speaker equipment, it may be necessary to pick up the handset before pressing the Star keys. One moment while we poll for questions. And our first question comes from the line of Brett Rabatin with Hovde Group. Please proceed with your question.

Operator: Thank you. And with that, we will now be conducting a question-and-answer session. If you'd like to ask a question, please press Star 1 on your telephone keypad. Confirmation tone will indicate that your line is in the question queue. You may press Star 2 to remove yourself from the queue. For any participants using speaker equipment, it may be necessary to pick up the handset before pressing the Star keys. One moment while we poll for questions. And our first question comes from the line of Brett Rabatin with Hovde Group. Please proceed with your question.

Speaker #2: Confirmation tone will indicate that your line is in the question queue. You may press star two to remove yourself from the queue. For any participants using speaker equipment, it may be necessary to pick up the handset before pressing the star keys.

Speaker #2: One moment while we poll for questions. And our first question comes from the line of Brett Ravitin with Hopti. Please proceed with your question.

Speaker #2: question. Hey guys, this is Anya

[Analyst] (Hovde Group): Hey, guys. This is Anya speaking on behalf of Brett. You know, I was just wondering if you guys feel there's any opportunities to lower CD funding costs in the next few quarters.

Anya Pelshaw: Hey, guys. This is Anya speaking on behalf of Brett. You know, I was just wondering if you guys feel there's any opportunities to lower CD funding costs in the next few quarters.

Speaker #3: speaking on behalf of Brett. You know, I was just wondering if you guys feel there's any opportunities to lower CD funding costs in the next few quarters?

Speaker #4: In regards to CD funding costs, as we've noted, we are dependent upon wholesale funding. And that wholesale funding cost tends to move with the Fed.

Kent Landvatter: In regards to CD funding costs, as we've noted, we are dependent upon wholesale funding. That wholesale funding cost tends to move with the Fed and the Fed's movement of the interest rate. So as the Fed reduces interest rates, we would expect to see a like-type decrease that will be blended in over time because we tend to run with CD maturities between 3 months and 1 year. So we would expect to benefit from those decreases, but at a gradual rate. We should be blending in some benefit from past rates over the next couple of quarters yet too.

Bob Wahlman: In regards to CD funding costs, as we've noted, we are dependent upon wholesale funding. That wholesale funding cost tends to move with the Fed and the Fed's movement of the interest rate. So as the Fed reduces interest rates, we would expect to see a like-type decrease that will be blended in over time because we tend to run with CD maturities between 3 months and 1 year. So we would expect to benefit from those decreases, but at a gradual rate. We should be blending in some benefit from past rates over the next couple of quarters yet too.

Speaker #4: And the Fed's movement of the interest rate. So, as the Fed reduces interest rates, we would expect to see a like-type decrease that will be blended in over time, because we tend to run with CD maturities between three months and one year.

Speaker #4: So we would expect the benefit from those decreases, but at a gradual rate. And we should be blending in some benefit from past rates over the next couple of quarters yet too.

Speaker #3: Thank you. And, you know, are there—do you guys have any thoughts on the progression of money rails and the BIN sponsorship potential later this year?

[Analyst] (Hovde Group): Thank you. And, you know, are there, do you guys have any thoughts on the progression of MoneyRails' and the BIN sponsorship potential later this year?

Anya Pelshaw: Thank you. And, you know, are there, do you guys have any thoughts on the progression of MoneyRails' and the BIN sponsorship potential later this year?

Speaker #4: Yes, as far as—let me speak first to the deposit, since Bob kind of teased that off. We're still very confident in our strategy on BIN payments.

Kent Landvatter: Yes. As far as, let me speak first to the deposit since Bob kind of teed that up. We're still very confident in our strategy on BIN payments, though the timing may be pushed out beyond our initial expectations. But just as a reminder, we never want to rely or over-rely on just one partner as a source of funding. So regardless of who they are, so our policies limit concentration on funding from one party, which means there were chunks of the broker deposits that we were replacing, but only to a certain concentration limit. So we don't think it's going to be hugely impactful this year. We think more of that will come through next year.

Speaker #4: Though the timing may be pushed out beyond our initial expectations, but just as a reminder, we never want to rely or over-rely on just one partner as a source of funding so regardless of who they are.

Speaker #4: So, our policies limit concentration on funding from one party, which means there were chunks of the broker deposits that we were replacing, but only to a certain concentration limit.

Speaker #4: So, we don't think it's going to be hugely impactful this year. We think more of that will come through next.

Speaker #4: year. Thank you.

[Analyst] (Hovde Group): Thank you. And last one for me, but, you know, any thoughts on the SBA business this year and, you know, whether management might be more or less aggressive with originations given the environment?

Anya Pelshaw: Thank you. And last one for me, but, you know, any thoughts on the SBA business this year and, you know, whether management might be more or less aggressive with originations given the environment?

Speaker #3: And last one for me, but, you know, any thoughts on the SBA business this year and, you know, whether management might be more or less aggressive with originations given the environment?

Speaker #4: Yeah, hey Anya, this is Jim. You know, SBA demand continues to be really solid in the pipeline. And versus last year, originations for us were down a little bit in the quarter.

Jim Noone: Yeah. Hey, Anya. This is Jim. You know, SBA demand continues to be really solid in the pipeline and versus last year. Originations for us were down a little bit in the quarter, but that was really just a timing delay from the shutdown rather than a demand issue. And we had a nice pickup in closings already in January. So overall, I'd say we have good demand from everything we see. Small business confidence is stable to rising. So we feel good about the SBA business right now.

Speaker #4: But that was really just a timing delay from the shutdown, rather than a demand issue. And we had a nice pickup in closings already in January.

Speaker #4: So overall, I'd say we have good demand from everything we see. Small business confidence is stable to rising, so we feel good about the SBA business right now.

Speaker #4: now. Thank

Speaker #3: you. Appreciate it. That's all for me.

[Analyst] (Hovde Group): Thank you. Appreciate it. That's all for me.

Anya Pelshaw: Thank you. Appreciate it. That's all for me.

Speaker #2: Thank you. And our next question comes from the line of Joe Yanchunis with Raymond James. Please proceed with your question.

Jim Noone: Thank you. And our next question comes from the line of Joe Yanchunis with Raymond James. Please proceed with your question.

Speaker #5: Good afternoon.

[Analyst] (Raymond James): Good afternoon.

Joe Yanchunis: Good afternoon.

Robert Wahlman: Hi.

Bob Wahlman: Hi.

Speaker #5: Hey Hi.

[Analyst] (Raymond James): Hey, Joe. So I was hoping to kind of circle back with deposits here. So it looks like period-end non-interest-bearing deposits increased pretty nicely this quarter, while average balances declined a bit. Was this surge in deposits related to credit-enhancement loans kind of coming on at the end of the period?

Kent Landvatter: Hey, Joe.

Speaker #5: Joe, so I was hoping to kind of circle back with—

Joe Yanchunis: So I was hoping to kind of circle back with deposits here. So it looks like period-end non-interest-bearing deposits increased pretty nicely this quarter, while average balances declined a bit. Was this surge in deposits related to credit-enhancement loans kind of coming on at the end of the period?

Speaker #4: The positives here—so it looks like period-end, non-interfering deposits increased pretty nicely this quarter, while average balances declined a bit. Was this surge in deposits related to credit enhancement loans kind of coming on at the end of the period?

Speaker #4: The surge in deposits resulted from at the resulted from certain of our strategic partners that are making student facilitating student loans. In anticipation of increased volume of student loans and the requirement to maintain collateral equal to the hold that we have on those loans, that they deposited significant funds at the end of the quarter.

Robert Wahlman: The surge in deposits resulted from, you know, resulted from certain of our strategic partners that are making student—are facilitating student loans in anticipation of increased volume of student loans and the requirement to maintain collateral equal to the hold that we have on those loans, that they deposited significant funds at the end of the quarter. So those funds will be held during the period of time that they have the higher origination volume. And then as that origination volume goes down, we expect that they will take those funds back away from us.

Bob Wahlman: The surge in deposits resulted from, you know, resulted from certain of our strategic partners that are making student—are facilitating student loans in anticipation of increased volume of student loans and the requirement to maintain collateral equal to the hold that we have on those loans, that they deposited significant funds at the end of the quarter. So those funds will be held during the period of time that they have the higher origination volume. And then as that origination volume goes down, we expect that they will take those funds back away from us.

Speaker #4: So those funds will be held during the period of time that they have the higher origination volume. And then as that origination volume goes down, we expect that they will take those funds back away from us.

Speaker #5: Okay. That's helpful. And then did I hear you correctly on your strategic or I'm sorry, your origination guidance that was, you know, annualized 1.4 billion, which is kind of the quarter to date run rate and kind of growth by

[Analyst] (Raymond James): Okay. That's helpful. And then did I hear you correctly on your strategic—or I'm sorry, your origination guidance? It was, you know, annualized $1.4 billion, which is kind of the quarter-to-date run rate and kind of growth by 5%? Because if so, that kind of points to a decline year-over-year. And I was just wondering what you would kind of attribute that to.

Joe Yanchunis: Okay. That's helpful. And then did I hear you correctly on your strategic—or I'm sorry, your origination guidance? It was, you know, annualized $1.4 billion, which is kind of the quarter-to-date run rate and kind of growth by 5%? Because if so, that kind of points to a decline year-over-year. And I was just wondering what you would kind of attribute that to.

Speaker #1: Five percent—because if so, that kind of points to a decline year over year. And I was just wondering what you would attribute that to.

Speaker #1: Attribute kind of that to?

Jim Noone: Yeah. That's the baseline, Joe, that we've put out as far as modeling guidance was the, you know, once you strip away the seasonality associated with student lending, $1.4 billion is a good baseline, and then apply a 5%, you know, growth factor on that. That's what we put out there because it takes away the seasonality of student lending.

Speaker #2: Yeah , that's the baseline . Joe , that we've put out as far as modeling guidance was the , you know , once you strip away the seasonality associated with student lending , 1.4 billion is is a good baseline and then apply a 5% , you know , growth factor on that .

Speaker #2: And that's what we put out there, because it takes away the seasonality of lending student.

[Analyst] (Raymond James): Is there any reason to think the seasonality in student lending wouldn't return in 2026 where you would get that big Q3 uptick?

Joe Yanchunis: Is there any reason to think the seasonality in student lending wouldn't return in 2026 where you would get that big Q3 uptick?

Speaker #1: Is there any reason to think the seasonality and lending wouldn't return in 2026, where you would get that big Q3 uptick?

Jim Noone: There is no reason to think that the seasonality would not return. So very likely would continue in the same seasonal fashion.

Speaker #2: There is no reason to think that the seasonality would not return, so very likely it would continue in the same seasonal fashion.

[Analyst] (Raymond James): Okay. I appreciate that. Switching over to kind of recontracting, I was hoping you could discuss that a little bit. How has the recontracting process gone with existing partners? And is there any, like, slug of notable contracts up for renegotiation this year?

Joe Yanchunis: Okay. I appreciate that. Switching over to kind of recontracting, I was hoping you could discuss that a little bit. How has the recontracting process gone with existing partners? And is there any, like, slug of notable contracts up for renegotiation this year?

Speaker #1: Okay . appreciate I that . Switching over to kind of I was recontracting , hoping you could discuss that a little bit . How is the recontracting process gone existing with partners and is there any like slug of notable contracts that for renegotiation this year ?

Jim Noone: Yeah. Recontracting, just historically, has gone really well at FinWise. You know, we've got 15 lending partners, I think, you know, since we started this business in 2016, and they've been, you know, operating without interruption, any type of regulatory issues, you know, since that time. I think we've had 3 partners in total that, for one reason or another, kind of matriculated out of their partnership. 2 of them were during COVID. They were commercial lenders that kind of went into COVID, you know, I would say, challenged and closed. So it wasn't anything in the partnership. It was really a business model and a business model issue for them. The third was one of our original partners back in, like, 2017 that we just never saw eye to eye on what the sponsorship relationship looked like.

Speaker #2: Yeah . Recontracting just historically has gone really well at fin wise . You know , we've got 15 lending partners . I think , you know , since we started this business in 2016 and have been , you know , operating without interruption type of any regulatory issues , you know , since that time , I think we've had three partners in total that for one reason or another , kind of matriculated out of their partnership .

Speaker #2: Two of them were during Covid . They were commercial lenders . That kind of went into Covid . You know , I would say challenged and closed .

Speaker #2: So it wasn't anything in the partnership . It was really a business model . And business a model issue for them . The third was one of our original partners back in like 2017 , that that we just never saw eye to eye on , on what the sponsorship relationship looked like .

Jim Noone: So we've been very fortunate in the partners that we've selected and I think have generally had really good relationships with them. You know, those contracts are generally 3- to 4-year initial terms with 2-year, you know, renewal terms on each of them. And so they're staggered. Every year, there's a handful that come up for renewal, but there's nothing I would point you to as far as concerns.

So we've been very fortunate in the partners that we've selected and I think have generally had really good relationships with them. You know, those contracts are generally 3- to 4-year initial terms with 2-year, you know, renewal terms on each of them. And so they're staggered. Every year, there's a handful that come up for renewal, but there's nothing I would point you to as far as concerns.

Speaker #2: So, we've been very fortunate in the partners that we've selected, and I think have generally had really good relationships with them.

Speaker #2: You know , those contracts are generally 3 to 4 year initial terms with two year , renewal terms on each of them . And so they're staggered every year .

Speaker #2: There’s a handful that come up for renewal, but there’s nothing I would point you to as far as concerns.

[Analyst] (Raymond James): Okay. And then last one for me here. There's been a kind of increase in discussions around fintechs hitting around bank charters. And, you know, what's your take on this trend and how it could impact both, you know, FinWise and the sponsor bank industry as a whole?

Joe Yanchunis: Okay. And then last one for me here. There's been a kind of increase in discussions around fintechs hitting around bank charters. And, you know, what's your take on this trend and how it could impact both, you know, FinWise and the sponsor bank industry as a whole?

Speaker #1: Okay . And then last one for me here , there's been an increase in discussions around fintechs getting their own bank charters and , you know , what's your take on this trend and how it could impact both Finwise Bancorp sponsor Bank industry as a whole ?

Robert Wahlman: Yeah. I'll take that one. We watch that pretty closely, actually, as there's a lot of fintech charters out there, as you know. There's also some here in Utah, some applications as well. But as we've said in the past, a banking charter is not really the best option for all fintechs. You know, of course, larger, well-established fintechs would be more interested than smaller fintechs. But any fintech looking at considering a charter would have to go through seriously how that would impact their vision, you know, culture, innovation cycles, and so forth. So but for FinWise specifically, we've always thought of our partners in terms of a bell curve.

Bob Wahlman: Yeah. I'll take that one. We watch that pretty closely, actually, as there's a lot of fintech charters out there, as you know. There's also some here in Utah, some applications as well. But as we've said in the past, a banking charter is not really the best option for all fintechs. You know, of course, larger, well-established fintechs would be more interested than smaller fintechs. But any fintech looking at considering a charter would have to go through seriously how that would impact their vision, you know, culture, innovation cycles, and so forth. So but for FinWise specifically, we've always thought of our partners in terms of a bell curve.

Speaker #2: Yeah , I'll .

Speaker #3: Take that one . We watch that pretty closely , actually . There's a lot of fintech charters out there . As you know .

Speaker #3: There's also some here in Utah , some some applications as well . But as we've said in the past , a banking charter is not really the best option for all fintechs .

Speaker #3: You know , of course , , well established fintechs would be more larger interested than smaller fintechs . But any fintech looking at considering a charter would have to go through seriously how that would impact their vision of culture innovation cycles and so forth .

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Q4 2025 FinWise Bancorp Earnings Call

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