FinWise Bancorp (FINW) investor relations material

Executive summary

• Loan originations reached $1.6 billion in Q2 2026, up 10% year-over-year but down sequentially due to student lending seasonality, reflecting a diversified partner base.

• Net income for Q2 2026 was $2.1 million, down from $2.7 million in Q1 2026 and $4.1 million in Q2 2025, impacted by higher provision expenses on loans with retained credit risk.

• Diluted EPS was $0.15, below expectations and down from $0.20 in Q1 2026 and $0.29 in Q2 2025.

• Credit quality improved with non-performing loan balances declining from $50 million to $38 million, mainly due to resolutions and paydowns in SBA 7 loans.

• Announced a new strategic partnership with a prepaid card provider, expected to go live in Q4 2026, and completed the acquisition of Tallied Technologies' credit card platform.

Financial highlights

• Net interest income was $28.7 million, up from $28.1 million in Q1 2026 and $14.7 million in Q2 2025, driven by credit-enhanced loan growth and fewer non-performing loans.

• Net interest margin rose to 13.69% from 12.90% in Q1 2026 and 7.81% in Q2 2025.

• Non-interest income increased to $25.6 million, mainly due to higher credit enhancement income and new interchange revenue.

• Non-interest expense was $28.9 million, up slightly due to credit enhancement guarantee and servicing costs.

• Efficiency ratio improved to 53.1% from 66.3% in Q1 2026 and 59.5% in Q2 2025.

• Total assets grew to $925.3 million, and deposits increased to $693.8 million.

Outlook and guidance

• Loan originations expected at $1.6 billion in Q3 and $1.4 billion in Q4 2026.

• Net charge-offs for non-credit enhanced loans guided at $4 million-$5 million per quarter for the rest of 2026.

• Net interest margin expected to increase with credit-enhanced balances; core margin to decline gradually.

• Efficiency ratio targeted for steady improvement, though may fluctuate.

• Provisioning in Q2 was an outlier; expects lower provisioning in the second half of 2026.

• Pipeline includes new and existing fintech partnerships expected to launch through 2027, supporting diversified revenue growth.