Live Oak Bancshares (LOB) investor relations material

Executive summary

• Q1 2026 delivered strong earnings momentum, with net income attributable to common shareholders rising to $27.9 million ($0.60 per diluted share), up 187.6% year-over-year but down 36.7% sequentially, driven by higher net interest income and lower provision for credit losses.

• Strong loan production of $1.37 billion and deposit growth of $146.4 million in Q1 2026, with total assets rising 12.5% year-over-year to $15.3 billion.

• Lending businesses showed robust growth, with stable to improving credit trends and significant gains in small dollar SBA lending and checking initiatives.

• Key growth drivers include AI-led innovation, technology investments, and expansion of business checking and small-dollar SBA lending.

• Strategic focus on innovation and customer relationship expansion is driving sustainable profitability.

Financial highlights

• Total revenue was $145.5 million, up 18.4% year-over-year but down 15.9% sequentially; net interest income rose 18.8% year-over-year to $119.4 million, but declined 3.0% sequentially.

• Noninterest expense increased 5.6% year-over-year to $85.3 million, but decreased 4.3% sequentially.

• Provision for credit losses was $20.1 million, down 30.6% year-over-year and 8.0% sequentially.

• Loan book grew 2% sequentially and 14% year-over-year; customer deposits rose 3% sequentially and 13% year-over-year.

• Shareholders' equity reached $1.28 billion, up 2.2% from December 31, 2025.

Outlook and guidance

• Pipeline at an all-time high, supporting confidence in continued loan growth and sustainable momentum.

• Expectation for low- to mid-teens loan growth year-over-year in a stable rate environment.

• Non-interest-bearing deposits targeted to exceed 10% of total deposits over the next three years.

• Future annual loan production target for AI-native origination platform set at $750 million+.

• Management is focused on remediating a material weakness in internal controls related to loan participation accounting.