Triumph Financial, Inc.
For the period ended Jun 30, 2026. Filed Jul 21, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2026 · Filed Jul 21, 2026
TFIN$61.23-1.6%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-03-31; filed 2026-04-21.
0001539638-26-000016
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-06-30; filed 2026-07-21.
0001539638-26-000029
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 266 previous paragraphs and 367 current paragraphs.
158 unchanged; 86 reworded; 87 added; 21 removed; 1 previous and 36 current paragraphs rearranged.
Tables are not compared: 41 previous and 65 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (87)
Current report
Second Quarter 2026 Overview
Current report
(2)See discussion below regarding mortgage warehouse clients' noninterest bearing servicing deposits.
Current report
(5)Ratios have been annualized.
Current report
Interest expense increased $5.2 million, or 25.3%, primarily driven by $12.3 million of deposit interest expense incurred in the current period from mortgage warehouse earnings interest rebates that exceeded interest earned on a given client's loans (see detailed discussion of this arrangement below). The impact of the excess mortgage warehouse rebates was partially offset by a decrease in total average interest-bearing liabilities of $584.9 million, or 18.2%, period over period, including a decrease in average total interest bearing deposits of $293.7 million, or 10.5% and a decrease in average FHLB borrowings of $292.0 million, or 98.0%. Increases and decrease in interest rates paid on our interest bearing liabilities were mixed. Average noninterest bearing demand deposits grew $1.417 billion primarily due to the recent influx of mortgage warehouse client deposits.
Current report
The decrease in our net interest margin was largely driven by lower short-term interest rates as the target Fed Funds rate was lower in the current period than in the same period in 2025, along with a higher proportion of our earning assets held in cash and cash equivalents.
Current report
Our average cost of interest bearing liabilities increased by 136 basis points. This increase in average cost was caused by the aforementioned excess mortgage warehouse rebates associated with mortgage warehouse client deposits.
Current report
Our mortgage warehouse business is more than self-funded due to the noninterest bearing servicing deposits of its clients. The average balance of such deposits was $2.045 billion and $781.3 million for the three months ended June 30, 2026 and 2025, respectively. Given their legal form, these deposits are classified as noninterest bearing deposits on our balance sheet. Despite their classification, many of these deposits are not truly free of cost as we compensate our clients for these balances in the form of an earnings interest rebate rather than deposit interest. As a result, such noninterest bearing deposits first decrease our loan yield before increasing our deposit rates. Because of the recent influx of these deposits, some clients hold significantly higher deposit balances than loan balances. As a result, we are now, in some cases, paying out more in rebates than we earn in interest on a given client’s loans. In those cases, we are recording that excess rebate as deposit interest expense. Whether recorded as interest expense or an offset to interest income, the effect on net interest income and net income is the same: these are profitable funds as they displace more expensive wholesale funding and can be invested risk-free above their cost. During the three months ended June 30, 2026 and June 30, 2025, deposit interest expense recognized on these deposits was $12.3 million and $0, respectively.
Current report
The following table shows the impact of mortgage warehouse excess rebates:
Current report
(1)Ratios have been annualized.
Current report
Our credit loss expense on loans increased $2.9 million, or 558.1%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025.
Current report
During the three months ended June 30, 2025, the Company acquired a $23.4 million nonperforming equipment finance commercial loan for $3.3 million. The loan was purchased credit deteriorated ("PCD") and a $10.8 million ACL was established on Day 1 resulting in a discount of $9.3 million. Prior to June 30, 2025, the Company determined that the $10.8 million ACL was uncollectible and charged off the entire amount. Such charge-off had no impact on credit loss expense.
Current report
•Net gains (losses) on disposal of premises and equipment. Net gains (losses) on disposal of premises and equipment decreased $1.6 million due to a valuation adjustment on a real estate of a branch we are in the process of closing and a terminated prepaid maintenance agreement.
Current report
•Other. Other noninterest income increased $0.9 million due to a $1.8 million payment tied to a change in control provision on the sale of an unrelated third-party business. There were no other significant changes within the components of other noninterest income.
Current report
•Professional Fees. Professional fees increased $7.4 million, primarily due to the recovery of $7.4 million of previously expensed legal fees through the USPS Settlement during the three months ended June 30, 2025 and $2.0 million of non-recurring consulting fees incurred during the three months ended June 30, 2026 related to our ongoing efficiency initiatives. The increase was partially offset by $3.0 million of professional fees incurred during the three months ended June 30, 2025 as a result of the Greenscreens acquisition that did not recur in the current period.
Current report
•Amortization of Intangible Assets. Amortization of intangible assets decreased $0.9 million, or 26.9%, primarily due to $0.4 million decrease in lease intangible amortization driven by the sale of the building in December 2025 that had been purchased for the purpose of constructing a future headquarters for Triumph.
Current report
See Note 16 – Business Segment Information in the accompanying condensed notes to the consolidated financial statements included elsewhere in this report for a description of our reportable segments.
Current report
Interest income increased $0.5 million, or 0.8%, at our Banking segment primarily as a result of increased interest income from cash deposits driven by an increase in the average balance of cash and cash equivalents period over period as a result of increased noninterest bearing deposit balances. This increase was partially offset by decreases in interest income from loans and securities. Average loans in our Banking segment, excluding intersegment loans, decreased 0.6% from $3.382 billion for the three months ended June 30, 2025 to $3.362 billion for the three months ended June 30, 2026, and our yields on these loans decreased period over period. The average balance of and yield on our debt securities also decreased period over period.
Current report
Interest expense increased $5.3 million, or 27.9%, primarily driven by $12.3 million of deposit interest expense from mortgage warehouse earnings interest rebates that exceeded interest earned on a given client's loans, partially offset by lower average balances and decreased rates on our interest bearing liabilities.
Current report
Noninterest income at our Banking segment decreased period over period due to a $1.1 million decrease in fee income from insurance services and a $0.9 million loss on disposal of premises and equipment during the three months ended June 30, 2026 due to a valuation adjustment on the real estate of a branch we are in the process of closing.
Current report
Noninterest expense at our Banking segment decreased period over period the details of which are illustrated in the table above. For the three months ended June 30, 2026, professional fees, a component of noninterest expense, at our Banking segment includes $2.0 million of non-recurring consulting fees incurred related to our ongoing efficiency initiatives.
Current report
Noninterest expense at our Factoring segment increased period over period the details of which are illustrated in the table above. For the three months ended June 30, 2025, professional fees, a component of noninterest expense, at our Factoring segment reflects a $7.4 million recovery of previously expensed legal fees associated with the USPS Settlement. Other noninterest expense at our Factoring segment for the three months ended June 30, 2025 included $2.0 million of expense driven by settlement of litigation unrelated to the USPS Settlement.
Current report
Noninterest expense at our Intelligence segment decreased period over period the details of which are illustrated in the table above. A majority of the professional fees recognized at our Intelligence segment during the three months ended June 30, 2025 relate to our acquisition of Greenscreens.
Current report
The decreased operating loss was primarily driven by a decrease in noninterest expense period over period, the details of which are illustrated in the table above. Other noninterest expense for the three months ended June 30, 2025 included $1.8 million of lease termination payments related to the building that had been purchased for the purpose of constructing a future headquarters for Triumph.
Current report
Noninterest income for Corporate and other increased period over period due to a $1.8 million payment tied to a change in control provision on the sale of an unrelated third-party business. This gain was partially offset by a $1.0 million loss on a terminated prepaid maintenance agreement.
Current report
Results of Operations
Current report
Six months ended June 30, 2026 compared with six months ended June 30, 2025
Current report
Net Income
Current report
We earned net income of $17.7 million for the six months ended June 30, 2026 compared to $4.4 million for the six months ended June 30, 2025, an increase of $13.3 million or 299.5%.
Current report
Net Interest Income
Current report
(2)See discussion below regarding mortgage warehouse clients' noninterest bearing servicing deposits.
Current report
(5)Ratios have been annualized.
Current report
We earned net interest income of $184.9 million for the six months ended June 30, 2026 compared to $173.1 million for the six months ended June 30, 2025, an increase of $11.8 million, or 6.8%, primarily driven by the following factors.
Current report
Interest income increased $15.8 million, or 7.5%, due to changes in average interest earning assets which increased $703.5 million, or 13.0%, including an increase in average total loans of $496.5 million, or 10.8%. The average balance of our higher yielding Factoring factored receivables increased $326.0 million, or 29.6%, and we experienced an increase in average Payments factored receivables. We experienced an increase in average Banking loans of $65.7 million, or 2.0% due to increases in the average balances of residential real estate, commercial, consumer, and mortgage warehouse loans. Interest income from our Banking loans is impacted by our lower yielding mortgage warehouse lending product. The average mortgage warehouse lending balance was $1.099 billion for the six months ended June 30, 2026 compared to $1.003 billion for the six months ended June 30, 2025.
Current report
Interest expense increased $4.0 million, or 10.3%, primarily driven by $12.3 million of deposit interest expense incurred in the current period from mortgage warehouse earnings interest rebates that exceeded interest earned on a given client's loans (see detailed discussion of this arrangement below). The impact of the excess mortgage warehouse rebates was partially offset by a decrease in average interest-bearing liabilities period over period, including average total interest bearing deposits which decreased $133.7 million, or 4.8%, and decreased rates on our interest bearing liabilities. Average noninterest bearing deposits grew $987.5 million.
Current report
Net interest margin decreased to 6.11% for the six months ended June 30, 2026 from 6.46% for the six months ended June 30, 2025, a decrease of 35 basis points, or 5.4%.
Current report
The decrease in our net interest margin was largely driven by lower short-term interest rates as the target Fed Funds rate was lower in the current period than in the same period in 2025, along with a higher proportion of our earning assets held in cash and cash equivalents.
Current report
Our average cost of interest bearing liabilities increased by 56 basis points. This increase in average cost was caused by the aforementioned excess mortgage warehouse rebates associated with mortgage warehouse client deposits.
Current report
Our mortgage warehouse business is more than self-funded due to the noninterest bearing servicing deposits of its customers. The average balance of such deposits was $1.590 billion and $713.7 million for the six months ended June 30, 2026 and 2025, respectively. Given their legal form, these deposits are classified as noninterest bearing deposits on our balance sheet. Despite their classification, many of these deposits are not truly free of cost as we compensate our clients for these balances in the form of an earnings interest rebate rather than deposit interest. As a result, such noninterest bearing deposits first decrease our loan yield before increasing our deposit rates. Because of the recent influx of these deposits, some clients hold significantly higher deposit balances than loan balances. As a result, we are now, in some cases, paying out more in rebates than we earn in interest on a given client’s loans. In those cases, we are recording that excess rebate as deposit interest expense. Whether recorded as interest expense or an offset to interest income, the effect on net interest income and net income is the same: these are profitable funds as they displace more expensive wholesale funding and can be invested risk-free above their cost. During the six months ended June 30, 2026 and June 30, 2025, deposit interest expense recognized on these deposits was $12.3 million and $0, respectively.
Current report
The following table shows the impact of mortgage warehouse excess rebates:
Current report
(1)Ratios have been annualized.
Showing the first 40 of 87 passages. Open the source sections for the rest.
Removed paragraphs (21)
Previous report
First Quarter 2026 Overview
Previous report
(4)Ratios have been annualized.
Previous report
Interest expense decreased $1.2 million, or 6.9%, primarily driven by a decrease in total average interest-bearing liabilities of $28.5 million, or 0.9%, period over period, despite an increase in average total interest bearing deposits of $28.2 million, or 1.0%. The decrease in interest expense was also driven by decreased rates on our interest bearing liabilities. Average noninterest bearing demand deposits grew $553.7 million.
Previous report
The decrease in our net interest margin was partially offset by a decrease in our average cost of interest bearing liabilities of 15 basis points. This decrease in average cost was caused by decreased rates across the majority of our interest bearing liabilities period over period.
Previous report
Our mortgage warehouse business has nearly self-funded for several quarters due to the servicing deposits of its customers. The average balance of such deposits was $1.135 billion and $646.1 million for the three months ended March 31, 2026 and 2025, respectively. These deposits are noninterest bearing deposits on our balance sheet. Despite their classification, many of these deposits are not truly free of cost as our clients are compensated for these balances in the form of an earnings interest rebate rather than deposit interest. As a result, such noninterest bearing deposits decrease our loan yield rather than increase our deposit rates. It is important to note that our net interest margin is not affected by this arrangement. During the three months ended March 31, 2026, these deposits decreased our overall yield on loans by 74 bps and our overall cost of deposits and cost of funds would have been 68 bps and 65 bps higher, respectively. During the three months ended March 31, 2025, these deposits decreased our overall yield on loans by 52 bps and our overall cost of deposits and cost of funds would have been 49 bps and 46 bps higher, respectively.
Previous report
Our credit loss expense on loans decreased $1.8 million, or 137.8%, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025.
Previous report
•Professional Fees. Professional fees decreased $1.3 million, or 21.5%, primarily due to $1.0 million of transaction costs associated with the Greenscreens acquisition recorded during the three months ended March 31, 2025.
Previous report
•Communication and Technology. Communication and technology increased $0.9 million, or 7.1%, primarily as a result of increases in license and software maintenance costs period over period.
Previous report
Our reportable segments are Banking, Factoring, Payments, and Intelligence, which have been determined based upon their business processes and economic characteristics. This determination also gave consideration to the structure and management of various product lines. The Banking segment includes the operations of TBK Bank. Our Banking segment derives its revenue principally from investments in interest earning assets as well as noninterest income typical for the banking industry. The Factoring segment derives its revenue from factoring services. The Payments segment includes the operations of TBK Bank's presentment, audit, and payment solution to Shipper, Broker, and Factor clients in the trucking industry. The Payments segment derives its revenue from transaction fees and interest income on factored receivables related to invoice payments. These factored receivables consist of both invoices where we offer a Carrier a quickpay opportunity to receive payment at a discount in advance of the standard payment term for such invoice in exchange for the assignment of such invoice to us and from offering Brokers the ability to settle their invoices with us on an extended term following our payment to their Carriers as an additional liquidity option for such Brokers. Our data intelligence segment was launched at the beginning of the fourth quarter of 2024 to turn the over-the-road trucking data collected through our services into actionable insights for our customers. This launch coincided with our acquisition of the assets Isometric Technologies Inc. that provides service and performance scoring and benchmarking capabilities to the over-the-road trucking industry. The operations of this segment were further supplemented with our acquisition of Greenscreens AI, Inc., a pricing solution for the logistics industry that delivers short-term freight market pricing intelligence and business insights, during the quarter ended June 30, 2025. The revenue for Intelligence offerings is derived through access and subscription fees, as well as seat licenses where applicable.
Previous report
The Corporate and Other category consists of other business activities that do not represent a reportable segment.
Previous report
Expenses that are directly attributable to the Company's Banking, Factoring, Payments, and Intelligence segments such as, but not limited to, occupancy, salaries and benefits to employees that are fully dedicated to the segment, and certain technology costs that can be attributed to specific users or functional areas within the segment are allocated as such. The Company continues to make considerable investments in shared services that benefit the entire organization and these expenses are allocated to the Corporate and Other category. The Company allocates such expenses to the Corporate and Other category in order for the Company's chief operating decision maker and investors to have clear visibility into the operating performance of each reportable segment.
Previous report
We allocate intersegment interest expense to the Factoring and Payments segments based on one-month term SOFR for their funding needs. When the Payments segment is self-funded, with customer deposit funding in excess of its factored receivables, intersegment interest income is allocated based on the Federal Funds effective rate. Management believes that such intersegment interest allocations appropriately reflect the current interest rate environment and the relatively quick turn of the underlying receivables.
Previous report
Reported segments and the financial information of the reported segments are not necessarily comparable with similar information reported by other financial institutions. Additionally, because of the interrelationships of the various segments, the information presented is not indicative of how the segments would perform if they operated as independent entities. Changes in management structure or allocation methodologies and procedures may result in future changes to previously reported segment financial data. The accounting policies of the segments are substantially the same as those described in the “Summary of Significant Accounting Policies” in Note 1 of the Company’s 2025 Form 10-K.
Previous report
Transactions between segments consist primarily of borrowed funds, payment network fees, and servicing fees. Intersegment interest expense is allocated to the Factoring and Payments segments as described above. Payment network fees are paid by the Factoring segment to the Payments segment for use of the payments network. Servicing fees are paid by the Payments segment to the Factoring segment for servicing factoring transactions with freight broker clients transferred from our Factoring segment to our Payments segment to align with the supply chain finance product offerings for this business. Servicing fees are paid by the Payments segment to the Factoring segment for servicing such product. The Factoring and Payments segments pay fees to our Banking segment for the Banking segment's execution of various banking services that benefit those segments. Credit loss expense is allocated based on the segment’s ACL determination. Noninterest income and expense directly attributable to a segment are assigned to the related segment. Various shared service costs such as human resources, accounting, finance, risk management and information technology expense are assigned to the Corporate and Other category if they are not directly attributable to a segment. Other segment expense consists of various loan and card related expenses and other insignificant miscellaneous costs not specifically reviewed by the Company's chief operating decision maker. Taxes are paid on a consolidated basis and are not allocated for segment purposes.
Previous report
(2) Net intersegment noninterest income (expense) includes:
Previous report
Interest expense decreased $1.2 million, or 7.2%, primarily driven by decreased rates on our interest bearing liabilities.
Previous report
Noninterest expense at our Factoring segment decreased period over period the details of which are illustrated in the table above.
Previous report
Noninterest expense at our Payments segment decreased period over period the details of which are illustrated in the table above.
Previous report
The increased operating loss was primarily driven by a decrease in noninterest income period over period. Noninterest income at our Corporate segment for the three months ended March 31, 2025 included a $0.6 million gain on sale of an airplane and $0.8 million in rental income from the aforementioned building sold in December 2025.
Previous report
Noninterest expense at our Corporate segment decreased period over period, the details of which are illustrated in the table above. Depreciation and other occupancy expense decreased primarily due to the sale of the building in December 2025 that had been purchased for the purpose of constructing a future headquarters for Triumph.
Previous report
OREO decreased $0.2 million with no material additions or removals during the period.
Reworded paragraphs (86)
Previous wording
We are a financial holding company headquartered in Dallas, Texas and registered under the Bank Holding Company Act, that offers a diversified line of banking, factoring, payments, and intelligence services. Our principal subsidiary is TBK Bank, SSB, a Texas state savings bank and the entity through which we offer substantially all of our products and services. Effective January, 1, 2025, we merged Triumph Financial Services LLC, the entity through which we previously conducted all of our factoring operations, with and into TBK Bank, SSB. As of March 31, 2026, we had consolidated total assets of $6.877 billion, total loans held for investment of $5.189 billion, total deposits of $5.700 billion and total stockholders’ equity of $950.7 million.
Current wording
We are a financial holding company headquartered in Dallas, Texas and registered under the Bank Holding Company Act, that offers a diversified line of banking, factoring, payments, and intelligence services. Our principal subsidiary is TBK Bank, SSB, a Texas state savings bank and the entity through which we offer substantially all of our products and services. Effective January, 1, 2025, we merged Triumph Financial Services LLC, the entity through which we previously conducted all of our factoring operations, with and into TBK Bank, SSB. As of June 30, 2026, we had consolidated total assets of $7.404 billion, total loans held for investment of $5.477 billion, total deposits of $6.217 billion and total stockholders’ equity of $963.3 million.
Previous wording
In addition to our traditional banking operations, we also operate a factoring business focused primarily on serving the over-the-road trucking industry. This business involves the provision of working capital to the trucking industry through the purchase of invoices generated by small to medium sized trucking fleets ("Carriers") at a discount to provide immediate working capital to such Carriers. In 2024, our factoring business also launched its Factoring as a Service ("FaaS") product. As part of our FaaS product, we offer certain back-office factoring services to the over-the-road transportation industry, enabling our FaaS customers to either supplement their own factoring operations or to offer factoring services to their customers wholly supported by our platform. Our factoring business operates in a highly specialized niche with unique processes and earns substantially higher yields on its factored accounts receivable portfolio than our other lending products described above.
Current wording
In addition to our traditional banking operations, we also operate a factoring business focused primarily on serving the over-the-road trucking industry. This business involves the provision of working capital to the trucking industry through the purchase of invoices generated by small to medium sized trucking fleets ("Carriers") at a discount to provide immediate working capital to such Carriers. In 2024, our factoring business also launched its Factoring as a Service ("FaaS") product. As part of our FaaS product, we offer certain back-office or white-labeled factoring services to the over-the-road transportation industry, enabling our FaaS customers to either supplement their own factoring operations or to offer factoring services to their customers wholly supported by our platform. Our factoring business operates in a highly specialized niche with unique processes and earns substantially higher yields on its factored accounts receivable portfolio than our other lending products described above.
Previous wording
As part of our payments business, we also offer our LoadPay product; a digital bank account developed for Carriers. LoadPay provides a user experience and financial products, including small business transactional accounts, tailored to the financial needs of the small trucking companies that are the ultimate payees inside of the network. A key feature of the LoadPay product is our ability to rapidly fund invoices approved for payment through the network or approved for purchase as part of our factoring operations to the LoadPay account without the need for such payments to be processed through traditional payment rails such as ACH transfers. We also offer supply chain finance to Brokers, allowing them to pay their Carriers faster and drive Carrier loyalty. In addition, through the network, we provide tools and services to increase automation, mitigate fraud, create back-office efficiency and improve the payment experience. Our payments business also operates in a highly specialized niche with unique processes and key performance indicators.
Current wording
As part of our payments business, we also offer our LoadPay product; a digital banking platform developed for Carriers. LoadPay provides a user experience and financial products, including small business transactional accounts, tailored to the financial needs of the small trucking companies that are the ultimate payees inside of the network. A key feature of the LoadPay product is our ability to rapidly fund invoices approved for payment through the network or approved for purchase as part of our factoring operations to the LoadPay account without the need for such payments to be processed through traditional payment rails such as ACH transfers. We also offer supply chain finance to Brokers, allowing them to pay their Carriers faster and drive Carrier loyalty. In addition, through the network, we provide tools and services to increase automation, mitigate fraud, create back-office efficiency and improve the payment experience. Our payments business also operates in a highly specialized niche with unique processes and key performance indicators.
Previous wording
We have determined our reportable segments are Banking, Factoring, Payments and Intelligence. For the three months ended March 31, 2026, our Banking segment generated 51% of our total segment revenue (comprised of interest and noninterest income), our Factoring segment generated 33% of our total segment revenue, our Payments segment generated 13% of our total segment revenue, and our Intelligence segment generated 3% of our total segment revenue.
Current wording
We have determined our reportable segments are Banking, Factoring, Payments and Intelligence. For the six months ended June 30, 2026, our Banking segment generated 50% of our total segment revenue (comprised of interest and noninterest income), our Factoring segment generated 35% of our total segment revenue, our Payments segment generated 14% of our total segment revenue, and our Intelligence segment generated 1% of our total segment revenue.
Previous wording
Net income available to common stockholders for the three months ended March 31, 2026 was $5.6 million, or $0.23 per diluted share, compared to a net loss to common stockholders for the three months ended March 31, 2025 of $0.8 million, or $(0.03) per diluted share. For the three months ended March 31, 2026, our return on average common equity was 2.48% and our return on average assets was 0.39%.
Current wording
Net income available to common stockholders for the three months ended June 30, 2026 was $10.6 million, or $0.44 per diluted share, compared to a net income to common stockholders for the three months ended June 30, 2025 of $3.6 million, or $0.15 per diluted share. For the three months ended June 30, 2026, our return on average common equity was 4.59% and our return on average assets was 0.63%.
Previous wording
At March 31, 2026, we had total assets of $6.877 billion, including gross loans held for investment of $5.189 billion, compared to $6.381 billion of total assets and $4.991 billion of gross loans held for investment at December 31, 2025. Total loans held for investment increased $197.8 million during the three months ended March 31, 2026. Our Banking loans, which constitute 67% of our total loan portfolio at March 31, 2026, decreased from $3.525 billion in aggregate as of December 31, 2025 to $3.467 billion as of March 31, 2026, a decrease of 1.6%. Our Factoring factored receivables, which constitute 27% of our total loan portfolio at March 31, 2026, increased from $1.221 billion in aggregate as of December 31, 2025 to $1.405 billion as of March 31, 2026, an increase of 15.1%. Our Payments factored receivables, which constitute 6% of our total loan portfolio at March 31, 2026, increased from $242.1 million in aggregate as of December 31, 2025 to $312.9 million as of March 31, 2026, an increase of 29.2%.
Current wording
At June 30, 2026, we had total assets of $7.404 billion, including gross loans held for investment of $5.477 billion, compared to $6.381 billion of total assets and $4.991 billion of gross loans held for investment at December 31, 2025. Total loans held for investment increased $485.8 million during the six months ended June 30, 2026. Our Banking loans, which constitute 61% of our total loan portfolio at June 30, 2026, decreased from $3.525 billion in aggregate as of December 31, 2025 to $3.337 billion as of June 30, 2026, a decrease of 5.3%. Our Factoring factored receivables, which constitute 32% of our total loan portfolio at June 30, 2026, increased from $1.221 billion in aggregate as of December 31, 2025 to $1.748 billion as of June 30, 2026, an increase of 43.2%. Our Payments factored receivables, which constitute 7% of our total loan portfolio at June 30, 2026, increased from $242.1 million in aggregate as of December 31, 2025 to $387.4 million as of June 30, 2026, an increase of 60.0%.
Previous wording
At March 31, 2026, we had total liabilities of $5.926 billion, including total deposits of $5.700 billion, compared to $5.439 billion of total liabilities and $4.950 billion of total deposits at December 31, 2025. Deposits increased $749.7 million during the three months ended March 31, 2026.
Current wording
At June 30, 2026, we had total liabilities of $6.440 billion, including total deposits of $6.217 billion, compared to $5.439 billion of total liabilities and $4.950 billion of total deposits at December 31, 2025. Deposits increased $1.267 billion during the six months ended June 30, 2026.
Previous wording
At March 31, 2026, we had total stockholders' equity of $950.7 million. During the three months ended March 31, 2026, total stockholders’ equity increased $8.9 million. Capital ratios remained strong with Tier 1 capital and total capital to risk weighted assets ratios of 10.68% and 12.56%, respectively, at March 31, 2026.
Current wording
At June 30, 2026, we had total stockholders' equity of $963.3 million. During the six months ended June 30, 2026, total stockholders’ equity increased $21.5 million. Capital ratios remained strong with Tier 1 capital and total capital to risk weighted assets ratios of 10.47% and 12.28%, respectively, at June 30, 2026.
Previous wording
The total dollar value of invoices purchased by our Factoring segment during the three months ended March 31, 2026 was $3.263 billion with an average invoice size of $1,938. The average transportation invoice size for the three months ended March 31, 2026 was $1,897. This compares to invoice purchase volume of $2.708 billion with an average invoice size of $1,808 and average transportation invoice size of $1,769 during the same period a year ago.
Current wording
The total dollar value of invoices purchased by our Factoring segment during the three months ended June 30, 2026 was $4.117 billion with an average invoice size of $2,201. The average transportation invoice size for the three months ended June 30, 2026 was $2,160. This compares to invoice purchase volume of $2.874 billion with an average invoice size of $1,693 and average transportation invoice size of $1,663 during the same period a year ago.
Previous wording
Our Payments segment processed 8.2 million invoices paying Carriers a total of $11.014 billion during the three months ended March 31, 2026. This compares to processed volume of 7.2 million invoices for a total of $8.778 billion during the same period a year ago.
Current wording
Our Payments segment processed 9.1 million invoices paying Carriers a total of $13.492 billion during the three months ended June 30, 2026. This compares to processed volume of 8.5 million invoices for a total of $10.081 billion during the same period a year ago.
Previous wording
The USPS Settlement had an $11.5 million positive impact on pretax net income for the year ended December 31, 2025 made up of the prior period impacts of the interest and fees, legal expense recovery, and the recovery of the previously charged-off acquired over-formula advances. The $19.4 million Misdirected Payments Receivable balance was legally discharged upon receipt of the settlement proceeds on July 10, 2025.
Current wording
The USPS Settlement had a $12.4 million and $11.5 million positive impact on pretax net income for the three and six months ended June 30, 2025, respectively made up of the prior period impacts of the interest and fees, legal expense recovery, and the recovery of the previously charged-off acquired over-formula advances. The $19.4 million Misdirected Payments Receivable balance was legally discharged upon receipt of the settlement proceeds on July 10, 2025.
Previous wording
Our transportation revenues, particularly in our factoring and payments segments, are highly correlated to fluctuations in the freight markets, particularly in brokered freight, which is priced largely off the spot market (a reflection of real-time balance of carrier supply and shipper demand in the market) and subject to variability in diesel prices. The softness in freight since 2023 was a combination of falling volumes and excess capacity. Throughout those years, average rates per mile have decreased and returned spot rates to levels last seen in 2019. For the spot rate market, the drop was a little higher than the drop in diesel prices over the same period. Spot rates had fallen below the cost per mile to operate for many carriers. As a result, we observed a number of small and medium-sized trucking companies either leave the market by signing on with larger carriers or electing to sell their fleets or companies and move on to other endeavors, though the pace of these exits has slowed recently. The confluence of these circumstances resulted in persistently low invoice prices and decreased prices of new and used equipment in recent years. Beginning in the fourth quarter of 2025 and continuing through the first quarter of 2026, capacity dynamics have begun to shift as increased CDL enforcement for non-domiciled drivers and heightened focus on English proficiency requirements reduced the effective supply of available drivers. This tightening in capacity began to rebalance the freight market, contributing to improved freight availability and rising spot rates. Over the same period, diesel prices also increased, driven primarily by higher crude oil prices and refinery constraints resulting in spot rates and fuel level reaching highs not seen in several years and driving improved revenue performance in our factoring segment.
Current wording
Our transportation revenues, particularly factoring revenue in our Factoring and Payments segments, are highly correlated to fluctuations in the freight markets, particularly in brokered freight, which is priced largely off the spot market (a reflection of real-time balance of carrier supply and shipper demand in the market) and subject to variability in diesel prices. The softness in freight since 2023 was a combination of falling volumes and excess capacity. Throughout those years, average rates per mile decreased and returned spot rates to levels last seen in 2019. For the spot rate market, the drop was a little higher than the drop in diesel prices over the same period. Spot rates had fallen below the cost per mile to operate for many carriers. As a result, we observed a number of small and medium-sized trucking companies either leave the market by signing on with larger carriers or electing to sell their fleets or companies and move on to other endeavors, though the pace of these exits has slowed recently. The confluence of these circumstances resulted in persistently low invoice prices and decreased prices of new and used equipment in recent years. Beginning in the fourth quarter of 2025 and continuing through the first half of 2026, capacity dynamics have shifted as increased CDL enforcement for non-domiciled drivers and heightened focus on English proficiency requirements reduced the effective supply of available drivers. This tightening in capacity began to rebalance the freight market, contributing to improved freight availability and rising spot rates. Over the same period, diesel prices also increased, driven primarily by higher crude oil prices and refinery constraints resulting in spot rates and fuel level reaching highs not seen in several years and driving improved revenue performance in our factoring segment.
Previous wording
Payments segment revenue growth generally has three drivers: winning new relationships, deepening existing relationships, and value-based pricing. Value-based pricing was the largest growth driver in payments revenue during the first quarter of 2026, but we also brought on and ramped up several new relationships while deepening relationships with others through our cross-selling efforts. Further, as fees are generally charged on a per invoice processed basis, an increase in payment invoices processed also drove an increase in Payments segment revenue.
Current wording
Payments segment revenue growth generally has three drivers: winning new relationships, deepening existing relationships, and value-based pricing. Value-based pricing was the largest growth driver in payments revenue during the first half of 2026, but we also brought on and ramped up several new relationships while deepening relationships with others through our cross-selling efforts. Further, as fees are generally charged on a per invoice processed basis, an increase in payment invoices processed also drove an increase in Payments segment revenue.
Previous wording
(3)Net charge-offs to average loans ratios are for the three months ended March 31, 2026 and the year ended December 31, 2025.
Current wording
(3)Net charge-offs to average loans ratios are for the six months ended June 30, 2026 and the year ended December 31, 2025.
Previous wording
We earned net income of $6.4 million for the three months ended March 31, 2026 compared to net income of $17 thousand for the three months ended March 31, 2025, an increase of $6.4 million.
Current wording
We earned net income of $11.4 million for the three months ended June 30, 2026 compared to net income of $4.4 million for the three months ended June 30, 2025, an increase of $7.0 million.
Previous wording
(2)Net interest spread is the yield on average interest earning assets less the rate on interest bearing liabilities.
Current wording
(3)Net interest spread is the yield on average interest earning assets less the rate on interest bearing liabilities.
Previous wording
(3)Net interest margin is the ratio of net interest income to average interest earning assets.
Current wording
(4)Net interest margin is the ratio of net interest income to average interest earning assets.
Previous wording
We earned net interest income of $86.1 million for the three months ended March 31, 2026 compared to $84.4 million for the three months ended March 31, 2025, an increase of $1.7 million, or 2.0%, primarily driven by the following factors.
Current wording
We earned net interest income of $98.8 million for the three months ended June 30, 2026 compared to $88.7 million for the three months ended June 30, 2025, an increase of $10.1 million, or 11.4%, primarily driven by the following factors.
Previous wording
Interest income increased $0.5 million, or 0.5%, due to changes in average interest earning assets which increased $491.8 million, or 9.3%, including an increase in average total loans of $446.4 million, or 10.0%. The average balance of our higher yielding Factoring factored receivables increased $209.2 million, or 19.7%, and our average Payments factored receivables increased $85.3 million, or 49.1%. Average Banking loans increased $151.9 million, or 4.7% due to increases in the average balances of construction, land development, and land, residential real estate, commercial, consumer, and mortgage warehouse loans. Interest income from our Banking loans is impacted by our lower yielding mortgage warehouse lending product. The average mortgage warehouse lending balance was $1.088 billion for the three months ended March 31, 2026 compared to $936.5 million for the three months ended March 31, 2025.
Current wording
Interest income increased $15.3 million, or 14.0%, due to changes in average interest earning assets which increased $912.9 million, or 16.5%, including an increase in average total loans of $546.0 million, or 11.6%. The average balance of our higher yielding Factoring factored receivables increased $441.4 million, or 38.8%, and our average Payments factored receivables increased $124.2 million, or 60.7%. Average Banking loans decreased $19.6 million, or 0.6% due to decreases in the average balances of commercial real estate, construction, land development, and land, and farmland loans. Interest income from our Banking loans is impacted by our lower yielding mortgage warehouse lending product. The average mortgage warehouse lending balance was $1.110 billion for the three months ended June 30, 2026 compared to $1.068 billion for the three months ended June 30, 2025.
Previous wording
Net interest margin decreased to 6.06% for the three months ended March 31, 2026 from 6.49% for the three months ended March 31, 2025, a decrease of 43 basis points or 6.6%.
Current wording
Net interest margin decreased to 6.15% for the three months ended June 30, 2026 from 6.43% for the three months ended June 30, 2025, a decrease of 28 basis points or 4.4%.
Previous wording
The decrease in our net interest margin was most impacted by a decrease in our yield on interest earning assets of 64 basis points to 7.23% for the three months ended March 31, 2026. This decrease was primarily driven by lower yields on loans which decreased 65 basis points to 7.72% for the period. Yield on our Banking loans decreased 102 basis points period over period driving much of the decrease in the yield on our overall loan portfolio. Our yield on Factoring and Payments factored receivables also decreased period over period. That said, our higher yielding Factoring factored receivables as a percentage of the total loan portfolio increased period over period which had an upward impact on our overall loan yield. Non-loan yields were mostly lower period over period.
Current wording
The decrease in our net interest margin was also impacted by a decrease in our yield on interest earning assets of 17 basis points to 7.75% for the three months ended June 30, 2026. This decrease was primarily driven by an increase in lower yielding cash and cash equivalent balances, partially offset by higher yields on loans which increased 15 basis points to 8.56% for the period. Our higher yielding Factoring factored receivables as a percentage of the total loan portfolio increased period over period which had an upward impact on our overall loan yield.
Previous wording
The ACL on held to maturity ("HTM") securities is estimated at each measurement date on a collective basis by major security type. At March 31, 2026 and December 31, 2025, the Company’s held to maturity ("HTM") securities consisted of investments in the subordinated notes of collateralized loan obligation (“CLO”) funds. Expected credit losses for these securities are estimated using a discounted cash flow methodology which considers historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts. At March 31, 2026 and December 31, 2025, the Company carried $3.1 million and $3.2 million, respectively, of these HTM securities at amortized cost. The required ACL on these balances was $2.1 million at March 31, 2026 and $1.6 million at December 31, 2025. We recognized $0.5 million of credit loss expense during the current quarter. Credit loss expense during the three months ended March 31, 2025 was $0.1 million. None of the overcollateralization triggers tied to the CLO securities were tripped as of March 31, 2026. Ultimately, the realized cash flows on CLO securities such as these will be driven by a variety of factors, including credit performance of the underlying loan portfolio, adjustments to the portfolio by the asset manager, and the timing of a potential call.
Current wording
The ACL on held to maturity ("HTM") securities is estimated at each measurement date on a collective basis by major security type. At June 30, 2026 and December 31, 2025, the Company’s held to maturity ("HTM") securities consisted of investments in the subordinated notes of collateralized loan obligation (“CLO”) funds. Expected credit losses for these securities are estimated using a discounted cash flow methodology which considers historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts. At June 30, 2026 and March 31, 2026, the Company carried $3.1 million and $3.1 million, respectively, of these HTM securities at amortized cost. The required ACL on these balances was $2.1 million at June 30, 2026 and $2.1 million at March 31, 2026. We recognized a benefit to credit loss expense of $0.1 million during the current quarter. Credit loss expense during the three months ended June 30, 2025 was also a benefit of $0.1 million. None of the overcollateralization triggers tied to the CLO securities were tripped as of June 30, 2026. Ultimately, the realized cash flows on CLO securities such as these will be driven by a variety of factors, including credit performance of the underlying loan portfolio, adjustments to the portfolio by the asset manager, and the timing of a potential call.
Previous wording
Our ACL on loans was $34.2 million as of March 31, 2026, compared to $36.5 million as of December 31, 2025, representing an ACL to total loans ratio of 0.66% and 0.73%, respectively.
Current wording
Our ACL on loans was $34.8 million as of June 30, 2026, compared to $36.5 million as of December 31, 2025, representing an ACL to total loans ratio of 0.64% and 0.73%, respectively.
Previous wording
The decrease in credit loss expense was primarily driven by net charge-off activity. During the three months ended March 31, 2026, we had net charge-offs of $1.9 million compared to net charge-offs of $5.8 million during the same period a year ago. Changes to projected loss drivers and prepayment speeds that the Company forecasted over the reasonable and supportable forecast periods to calculate expected losses resulted in a benefit to credit loss expense of $1.7 million during the three months ended March 31, 2026 compared to $0.5 million of credit loss expense during the same period a year ago. Further, changes in volume and mix of the loan portfolio resulted in credit loss expense of $0.1 million during the three months ended March 31, 2026 compared to $0.6 million of credit loss expense during the same period a year ago.
Current wording
The increase in credit loss expense was primarily driven by net charge-off activity. During the three months ended June 30, 2026, we had net charge-offs of $1.7 million. Excluding the $10.8 million charge-off on the acquired PCD loan which had no impact on credit loss expense, we had a net recovery of $3.0 million during the three months ended June 30, 2025. Such net charge-offs for the three months ended June 30, 2025 includes the aforementioned $3.8 million recovery resulting from the USPS Settlement. Further, changes in volume and mix of the loan portfolio resulted in credit loss expense of $3.1 million during the three months ended June 30, 2026 compared to $1.2 million of credit loss expense during the same period a year ago. The increase in credit loss expense was partially offset by changes to projected loss drivers and prepayment speeds that the Company forecasted over the reasonable and supportable forecast periods to calculate expected losses which resulted in a benefit to credit loss expense of $2.0 million during the three months ended June 30, 2026 compared to $0.2 million of benefit to credit loss expense during the same period a year ago. The increase in credit loss expense was also partially offset by changes in required specific reserves. Such specific reserves decreased $0.6 million during the three months ended June 30, 2026 compared to an increase of $1.5 million during the same period a year ago.
Previous wording
Credit loss expense for off balance sheet credit exposures decreased$0.5 million, primarily due to changes to outstanding commitments to fund and changes to assumed loss rates period over period.
Current wording
Credit loss expense for off balance sheet credit exposures increased$0.6 million, primarily due to changes to outstanding commitments to fund and changes to assumed loss rates period over period.
Previous wording
Noninterest income increased $2.5 million, or 14.6%. Changes in selected components of noninterest income in the above table are discussed below.
Current wording
Noninterest income increased $2.0 million, or 10.5%. Changes in selected components of noninterest income in the above table are discussed below.
Previous wording
•Fee income. Fee income increased $4.6 million due to a $2.6 million increase in fee income from our Payments segment and a $2.0 million increase in fee income from our Intelligence segment mostly driven by the acquisition of Greenscreens in May 2025. There were no other significant changes within the components of fee income.
Current wording
•Fee income. Fee income increased $2.8 million due to a $3.1 million increase in fee income from our Payments segment and a $0.7 million increase in fee income from our Intelligence segment, partially offset by a $1.1 million decrease in fee income from insurance services. There were no other significant changes within the components of fee income.
Previous wording
•Salaries and Employee Benefits. Salaries and employee benefits expenses decreased $0.6 million, or 0.9%. Our average full-time equivalent employees were 1,443.3 and 1,547.7 for the three months ended March 31, 2026 and 2025, respectively. Employee salaries decreased $2.3 million and commissions expense decreased $0.2 million. These decreases were offset by an increase in bonus expense of $0.4 million and an increase in employee benefits expense such as 401(k) benefits match, employee insurance and stock based compensation of $1.5 million.
Current wording
•Salaries and Employee Benefits. Salaries and employee benefits expenses increased $0.2 million, or 0.3%. Our average full-time equivalent employees were 1,440.3 and 1,576.0 for the three months ended June 30, 2026 and 2025, respectively. Employee salaries decreased $1.3 million, bonus expense decreased $1.4 million, and temporary labor decreased $0.1 million. These decreases were offset by an increase in severance expense of $1.8 million, an increase in commissions expense of $0.5 million, and an increase in employee benefits expense such as 401(k) benefits match, employee insurance and stock based compensation of $0.9 million.
Previous wording
•Occupancy, Furniture and Equipment. Occupancy, furniture and equipment expenses decreased $1.9 million, or 23.0%, primarily due to a $1.1 million decrease in depreciation expense driven by the sale of the building in December 2025 that had been purchased for the purpose of constructing a future headquarters for Triumph and a $0.3 million decrease in building property taxes period over period.
Current wording
•Occupancy, Furniture and Equipment. Occupancy, furniture and equipment expenses decreased $1.8 million, or 21.8%, primarily due to a $1.2 million decrease in depreciation expense and a $0.3 million decrease in building property taxes mostly driven by the sale of the building in December 2025 that had been purchased for the purpose of constructing a future headquarters for Triumph.
Previous wording
•Software Amortization. Software amortization expense increased $1.3 million, or 65.7%, primarily due to additional software assets coming on line during early 2025.
Current wording
•Software Amortization. Software amortization expense increased $0.6 million, or 21.4%, primarily due to additional software assets coming on line during late 2025 and early 2026.
Previous wording
•Other. Other noninterest expense includes loan-related expenses, training and recruiting, postage, insurance, and subscription services. Other noninterest expense decreased $0.5 million, or 7.9%. There were no significant changes within the components of other noninterest expense.
Current wording
•Other. Other noninterest expense, which includes loan-related expenses, training and recruiting, postage, insurance, and subscription services, decreased $3.8 million, or 37.3%. Other noninterest expense for the three months ended June 30, 2025 included a $2.0 million litigation settlement (unrelated to the USPS Settlement) and $1.8 million of lease termination payments related to the building we sold in December 2025. There were no other significant changes within the components of other noninterest expense.
Previous wording
Income tax expense increased $1.7 million, from $0.1 million for the three months ended March 31, 2025 to $1.8 million for the three months ended March 31, 2026. The effective tax rate was 22% for the three months ended March 31, 2026, compared to 76% for the three months ended March 31, 2025. The effective tax rate for the three months ended March 31, 2025 was impacted by the relatively small numbers used to calculate such rate.
Current wording
Income tax expense increased $1.0 million, from $3.5 million for the three months ended June 30, 2025 to $4.5 million for the three months ended June 30, 2026. The effective tax rate was 28% for the three months ended June 30, 2026, compared to 44% for the three months ended June 30, 2025. The effective tax rate for the three months ended June 30, 2025 was impacted by limited restricted stock stock-based compensation deductibility, higher state tax rates, and higher disallowed expenses including some transaction costs paid in connection with the Greenscreens acquisition.
Previous wording
Our Banking segment’s operating income decreased $3.0 million, or 10.9%.
Current wording
Our Banking segment’s operating income decreased $2.1 million, or 8.1%.
Previous wording
Intersegment interest income allocated to our Banking segment increased period over period due to increased funding provided to our Factoring segment resulting in increased intersegment interest allocation from such segment.
Current wording
Intersegment interest income allocated to our Banking segment increased period over period due to increased funding provided to our Factoring segment resulting in increased intersegment interest allocation from such segment, partially offset by a decrease in intersegment interest allocations to our Payments segment.
Previous wording
Credit loss expense at our Banking segment is made up of credit loss expense related to loans and credit loss expense related to off balance sheet commitments to lend. Credit loss expense related to loans was a benefit of $1.8 million for the three months ended March 31, 2026 compared to credit loss expense on loans of $0.6 million for the three months ended March 31, 2025. The decrease in credit loss expense was the result of decreased net charge-offs, a decrease driven by changes to the projected loss drivers and prepayment speeds that the company forecasted over the reasonable and supportable forecast periods, and a decrease driven by changes in volume and mix of our Banking segment's loan portfolio period over period. Such decreases were partially offset by increased required specific reserves at our Banking segment.
Current wording
Credit loss expense at our Banking segment is made up of credit loss expense related to loans and credit loss expense related to off balance sheet commitments to lend. Credit loss expense related to loans was a benefit of $0.5 million for the three months ended June 30, 2026 compared to credit loss expense on loans of $2.3 million for the three months ended June 30, 2025. The decrease in credit loss expense was the result of changes to the projected loss drivers and prepayment speeds that the company forecasted over the reasonable and supportable forecast periods and a decrease in required specific reserves at our Banking segment. The decrease in credit loss expense was partially offset by increases driven by changes in volume and mix of our Banking segment's loan portfolio period over period and increased net charge-offs at our Banking segment.
Previous wording
Credit loss expense for off balance sheet credit exposures decreased $0.5 million, from a benefit of $0.1 million for the three months ended March 31, 2025 to a benefit of $0.6 million for the three months ended March 31, 2026, primarily due to changes to outstanding commitments to fund and changes to assumed loss rates period over period.
Current wording
Credit loss expense for off balance sheet credit exposures at our Banking segment increased $0.6 million, from a benefit of $0.1 million for the three months ended June 30, 2025 to credit loss expense of $0.5 million for the three months ended June 30, 2026, primarily due to changes to outstanding commitments to fund and changes to assumed loss rates period over period.
Previous wording
Year to date, our aggregate outstanding balances for our banking products, excluding intercompany loans, has decreased $58.0 million, or 1.6%, to $3.467 billion as of March 31, 2026. The following table sets forth our banking loans:
Current wording
Year to date, our aggregate outstanding balances for our banking products, excluding intercompany loans, has decreased $188.2 million, or 5.3%, to $3.337 billion as of June 30, 2026. The following table sets forth our banking loans:
Previous wording
(1)Operating margin is a non-GAAP financial measure used as a supplemental measure to evaluate the performance of our Factoring segment. It provides meaningful supplemental information regarding the segment's operational performance and enhances investors' overall understanding of the Factoring segment's profitability and operational efficiency.
Current wording
(1)Operating margin is a non-GAAP financial measure used as a supplemental measure to evaluate the performance of our Factoring segment. It provides meaningful supplemental information regarding the segment's operational performance and enhances investors' overall understanding of the Factoring segment's profitability and operational efficiency. For the three months ended June 30, 2025, operating income and factoring total revenue were impacted by $1.2 million of interest and fees resulting from the USPS Settlement and such settlement further impacted operating income by $7.4 million of legal expense accrual reversal and $3.8 million of recovery of factoring balances charged off in a prior period. Operating income was also impacted by a $2.0 million legal settlement that was unrelated to the USPS Settlement. Such items had a 24.71% impact on operating margin, a 0.43% impact on yield on average receivables, and a 0.46% impact on yield on average net funds employed for the three months ended June 30, 2025.
Previous wording
Our Factoring segment’s operating income increased $7.6 million, or 109.6%.
Current wording
Our Factoring segment’s operating income increased $1.1 million, or 5.7%.
Previous wording
Our average invoice size increased 7.2% from $1,808 for the three months ended March 31, 2025 to $1,938 for the three months ended March 31, 2026. This increase is the result of a broad increase in transportation invoice prices across the industry as capacity exits and rising fuel costs began to impact pricing. Additionally, the number of invoices purchased increased 12.4% period over period.
Current wording
Our average invoice size increased 30.0% from $1,693 for the three months ended June 30, 2025 to $2,201 for the three months ended June 30, 2026. This increase is the result of a broad increase in transportation invoice prices across the industry as capacity exits and rising fuel costs began to impact pricing. Additionally, the number of invoices purchased increased 10.2% period over period.
Showing the first 40 of 86 pairs. Open the source sections for the rest.
Rearranged current paragraphs (36)
Current report — wording carried from elsewhere
Net income available to common stockholders for the six months ended June 30, 2026 was $16.1 million, or $0.67 per diluted share, compared to net income available to common stockholders for the six months ended June 30, 2025 of $2.8 million, or $0.12 per diluted share. For the six months ended June 30, 2026, our return on average common equity was 3.55% and our return on average assets was 0.52%.
Current report — wording carried from elsewhere
Noninterest expense increased $0.8 million, or 0.8%. Details of the more significant changes in the various components of noninterest expense are further discussed below.
Current report — wording carried from elsewhere
Our Intelligence segment's operating loss for the three months ended June 30, 2026 was $3.3 million, compared to an operating loss of $6.0 million for the three months ended June 30, 2025.
Current report — wording carried from elsewhere
Noninterest income at our Intelligence segment increased period over period, primarily due to a full quarter of intelligence fee income in the current period. As previously disclosed, the data intelligence line of business did not have meaningful operations prior to the acquisition of Greenscreens in May 2025.
Current report — wording carried from elsewhere
Details of the changes in the various components of net income are further discussed below.
Current report — wording carried from elsewhere
Our operating results depend primarily on our net interest income, which is the difference between interest income on interest earning assets, including loans and securities, and interest expense incurred on interest bearing liabilities, including deposits and other borrowed funds. Interest rate fluctuations, as well as changes in the amount and type of interest earning assets and interest bearing liabilities, combine to affect net interest income. Our net interest income is affected by changes in the amount and mix of interest earning assets and interest bearing liabilities, referred to as a “volume change.” It is also affected by changes in yields earned on interest earning assets and rates paid on interest bearing liabilities, referred to as a “rate change.”
Current report — wording carried from elsewhere
The following table presents the distribution of average assets, liabilities and equity, as well as interest income and fees earned on average interest earning assets and interest expense paid on average interest bearing liabilities. Average balances and interest are inclusive of assets and deposits classified as held for sale.
Current report — wording carried from elsewhere
(1)Balance totals include respective nonaccrual assets.
Current report — wording carried from elsewhere
(3)Net interest spread is the yield on average interest earning assets less the rate on interest bearing liabilities.
Current report — wording carried from elsewhere
(4)Net interest margin is the ratio of net interest income to average interest earning assets.
Current report — wording carried from elsewhere
The following table presents loan yields earned on our loan portfolios:
Current report — wording carried from elsewhere
The following table shows the effects that changes in average balances (volume) and average interest rates (rate) had on the interest earned on our interest earning assets and the interest incurred on our interest bearing liabilities:
Current report — wording carried from elsewhere
Credit loss expense is the amount of expense that, based on our judgment, is required to maintain the allowances for credit losses (“ACL”) at an appropriate level under the current expected credit loss model. The determination of the amount of the allowance is complex and involves a high degree of judgment and subjectivity. Refer to Note 1 of the Company’s 2025 Form 10-K for detailed discussion regarding ACL methodologies for available for sale debt securities, held to maturity securities and loans held for investment.
Current report — wording carried from elsewhere
The following table presents the major categories of credit loss expense:
Current report — wording carried from elsewhere
For available for sale debt securities in an unrealized loss position, the Company evaluates the securities at each measurement date to determine whether the decline in the fair value below the amortized cost basis (impairment) is due to credit-related factors or noncredit-related factors. Any impairment that is not credit related is recognized in other comprehensive income, net of applicable taxes. Credit-related impairment is recognized as an ACL on the balance sheet, limited to the amount by which the amortized cost basis exceeds the fair value, with a corresponding adjustment to earnings via credit loss expense. At December 31, 2025 and June 30, 2026, the Company determined that all impaired available for sale securities experienced a decline in fair value below the amortized cost basis due to noncredit-related factors. Therefore, the Company carried no ACL at those respective dates and there was no credit loss expense recognized by the Company during the six months ended June 30, 2026. The same was true for the same period in the prior year.
Current report — wording carried from elsewhere
The ACL on held to maturity securities is estimated at each measurement date on a collective basis by major security type. At June 30, 2026 and December 31, 2025, the Company’s held to maturity securities consisted investments in the subordinated notes of collateralized loan obligation (“CLO”) funds. Expected credit losses for these securities are estimated using a discounted cash flow methodology which considers historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts. At June 30, 2026 and December 31, 2025, the Company carried $3.1 million and $3.2 million of these HTM securities at amortized cost, respectively. The ACL on these balances was $2.1 million at June 30, 2026 and $1.6 million at December 31, 2025. During the six months ended June 30, 2025, the Company charged off one of its three investments in these CLO funds in the amount of $2.2 million. The charge-off was fully reserved in a prior period and as a result, there was no impact to credit loss expense during the six months ended June 30, 2025. We recognized credit loss expense of $0.4 million during the six months ended June 30, 2026. During the six months ended June 30, 2025, we recognized credit loss expense of $48 thousand. None of the overcollateralization triggers tied to the CLO securities were tripped as of June 30, 2026. Ultimately, the realized cash flows on CLO securities such as these will be driven by a variety of factors, including credit performance of the underlying loan portfolio, adjustments to the portfolio by the asset manager, and the timing of a potential call.
Current report — wording carried from elsewhere
Our ACL on loans was $34.8 million as of June 30, 2026, compared to $36.5 million as of December 31, 2025, representing an ACL to total loans ratio of 0.64% and 0.73% respectively.
Current report — wording carried from elsewhere
The increase in credit loss expense was partially offset by changes to projected loss drivers and prepayment speeds that the Company forecasted over the reasonable and supportable forecast periods to calculate expected losses resulted in a benefit to credit loss expense of $3.6 million during the six months ended June 30, 2026 compared to $0.3 million of credit loss expense during the same period a year ago.
Current report — wording carried from elsewhere
The following table presents our major categories of noninterest income:
Current report — wording carried from elsewhere
Noninterest income increased $4.5 million, or 12.4%. Changes in selected components of noninterest income in the above table are discussed below.
Current report — wording carried from elsewhere
The following table presents our major categories of noninterest expense:
Current report — wording carried from elsewhere
•Software amortization. Software amortization increased $1.9 million, or 39.5%, primarily due to additional software assets coming on line.
Current report — wording carried from elsewhere
The amount of income tax expense is influenced by the amount of pre-tax income, the amount of tax-exempt income and the effect of changes in valuation allowances maintained against deferred tax benefits.
Current report — wording carried from elsewhere
The following tables present our primary operating results for our operating segments:
Current report — wording carried from elsewhere
(1) Includes revenue and expense from the Company’s holding company, which does not meet the definition of an operating segment. Also includes corporate shared service costs such as the majority of salaries and benefits expense for our executive leadership team, as well as other selling, general, and administrative shared services costs including human resources, accounting, finance, risk management and a significant amount of information technology expense.
Current report — wording carried from elsewhere
Credit loss expense at our Banking segment is made up of credit loss expense related to loans and credit loss expense related to off balance sheet commitments to lend. Credit loss expense related to loans at our Banking segment was a benefit of $2.3 million for the six months ended June 30, 2026 compared to credit loss expense on loans of $2.9 million for the six months ended June 30, 2025. The decrease in credit loss expense was the result of decreased net charge-offs at our banking segment, a decrease driven by changes to the projected loss drivers and prepayment speeds that the Company forecasted over the reasonable and supportable forecast periods, and a decrease driven by changes in the volume and mix of our Banking segment's loan portfolio period over period. The decrease in credit loss expense was partially offset by an increase in required specific reserves at our Banking segment period over period.
Current report — wording carried from elsewhere
Our Factoring segment’s operating income increased $8.7 million, or 32.6%.
Current report — wording carried from elsewhere
Our average invoice size increased 18.8% from $1,747 for the six months ended June 30, 2025 to $2,076 for the six months ended June 30, 2026. This increase is the result of a broad increase in transportation invoice prices across the industry as capacity exits and rising fuel costs began to impact pricing. Additionally, the number of invoices purchased increased 11.2% period over period.
Current report — wording carried from elsewhere
Net interest income at our Factoring segment increased period over period. Overall average net funds employed (“NFE”) increased 34.2% during the six months ended June 30, 2026 compared to the same period in 2025. The increase in average NFE was the result of increased invoice purchase volume and increased average invoice sizes. See further discussion under the Recent Developments: Transportation Update section. We maintained high concentration in transportation factoring balances, which typically generate a higher yield than our non-transportation factoring balances. This concentration was at 96% at June 30, 2025 and 97% at June 30, 2026. Net interest income at our Factoring segment was also impacted by an increase in its intersegment interest allocation charge period over period driven by higher average Factoring balances and partially offset by lower intercompany rates consistent with lower rates in the broader macro economy period over period.
Current report — wording carried from elsewhere
(1)Earnings (losses) before interest, taxes, depreciation, and amortization ("EBITDA") and EBITDA margin are non-GAAP financial measures used as supplemental measures to evaluate the performance of our Payments segment. EBITDA is useful because it provides a clearer view of underlying operating performance by excluding the effects of capital structure, tax regimes, and non-cash depreciation and amortization. EBITDA margin complements EBITDA by illustrating how efficiently revenue is converted into operating profitability.
Current report — wording carried from elsewhere
(2)Payments EBITDA excluding LoadPay and Payments EBITDA Margin excluding LoadPay are non-GAAP financial metrics used as supplemental measures to evaluate the performance of our Payments segment exclusive of the investments associated with LoadPay, which is a relatively new product in its early stages. Such adjusted EBITDA measures provide comparable clarity into the performance of our Payments segment prior to the advent of our LoadPay product.
Current report — wording carried from elsewhere
We began processing network transactions during the first quarter of 2022. When a fully integrated payments customer payor receives an invoice from a fully integrated payments customer payee, we call that a “network transaction.” All network transactions are included in our payment processing volume above. These transactions are facilitated through payments platform APIs with parties on both sides of the transaction using structured data; similar to how a credit card works at a point-of-sale terminal. The integrations largely automate the process and make it cheaper, faster and safer. During the six months ended June 30, 2026, we processed 2,089,125 network invoices representing a network payment volume of $4.218 billion. During the six months ended June 30, 2025, we processed 1,724,134 network invoices representing a network payment volume of $2.747 billion.
Current report — wording carried from elsewhere
Net interest income increased due to an increased average balance of interest earning assets at our Payments segment. The increase was partially offset by decreased average rates at our Payments segment and decreased intersegment interest allocations.
Current report — wording carried from elsewhere
The acquisition of HubTran during the year ended December 31, 2021 allowed us to create a fully integrated payments network for trucking; servicing brokers and factors. Prior to the HubTran acquisition, our payments platform already offered tools and services to increase automation, mitigate fraud, create back-office efficiency and improve the payment experience. Through the acquisition of HubTran, we created additional value through the enhancement of its presentment, audit, and payment capabilities for third party logistics companies (i.e., freight brokers) and their carriers, and factors. The acquisition of HubTran was a meaningful inflection point in the operations of our payments and audit business as our strategy shifted from a capital-intensive on-balance sheet product with a focus on interest income to an open-loop payments network for the trucking industry with an additional focus on fee revenue. It is for this reason that management believes that earnings before interest, taxes, depreciation, and amortization ("EBITDA") enhance investors' overall understanding of the financial performance of the Payments segment. Further, management's investment in the LoadPay product began in earnest during 2025 and has increased over time. We adjust EBITDA and EBITDA margin at our Payments segment so investors can see returns both inclusive and exclusive of the investments associated with the LoadPay product. Because LoadPay is a relatively new product in its early stages, such adjusted EBITDA measures provide comparable clarity into the performance of our Payments segment prior to the advent of our LoadPay product.
Current report — wording carried from elsewhere
(1)Gross margin is a non-GAAP financial measure used as supplemental measure to evaluate the performance of our Intelligence segment. Cost of revenues is comprised primarily of salaries and benefits and communications and technology costs for employees providing services to the Company's customers. This includes the costs of the Company's personnel performing integration, customer support, third-party data center and customer training activities. Cost of revenues also includes the direct costs of third party hosting services. We have elected to exclude amortization expense of capitalized developed software and acquired technology, as well as allocations of fixed asset depreciation expense and occupancy expenses from cost of revenues.
Current report — wording carried from elsewhere
Corporate and other is not a reportable segment, but rather includes certain revenue and expense from the Company's holding company as well as activities not allocated to specific business segments. Corporate and other reported an operating loss of $58.6 million for the six months ended June 30, 2026 compared to an operating loss of $60.4 million for the six months ended June 30, 2025.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
The decrease in credit loss expense was partially offset by changes in required specific reserves. Such specific reserves decreased $0.8 million during the three months ended March 31, 2026 compared to a decrease of $5.6 million during the same period a year ago.