Bancorp, Inc.

Previous wording

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) provides information about our results of operations, financial condition, liquidity and asset quality. This information is intended to facilitate your understanding and assessment of significant changes and trends related to our financial condition and results of operations. This MD&A should be read in conjunction with our financial information in our Form 10-K for the fiscal year ended 2025 (the “2025 Form 10-K”) and the interim Condensed Consolidated Financial Statements and notes thereto contained in this Quarterly Report on Form 10-Q.

Current wording

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) provides information about our results of operations, financial condition, liquidity and asset quality. This information is intended to facilitate your understanding and assessment of significant changes and trends related to our financial condition and results of operations. This MD&A should be read in conjunction with our financial information in our Annual Report on Form 10-K for the year ended December, 31, 2025 (the “2025 Form 10-K”) and the interim Condensed Consolidated Financial Statements and notes thereto contained in this Quarterly Report on Form 10-Q.

Previous wording

When used in this Quarterly Report on Form 10-Q, statements regarding The Bancorp’s business, that are not historical facts, are “forward-looking statements.” These statements may be identified by the use of forward-looking terminology, including, but not limited to the words “intend,” “may,” “believe,” “will,” “expect,” “look,” “anticipate,” “plan,” “estimate,” “continue,” or similar words. Forward-looking statements include but are not limited to, statements regarding our annual fiscal 2026 results, increased growth, profitability, and volumes, and our ability to reallocate or reduce resources, and relate to our current assumptions, projections, and expectations about our business and future events, including current expectations about important economic, political, and technological factors, among other factors, and are subject to risks and uncertainties, which could cause the actual results, events, or achievements to differ materially from those set forth in or implied by the forward-looking statements and related assumptions. Factors that could cause results to differ from those expressed in the forward-looking statements also include, but are not limited to, the risks and uncertainties referenced or described in The Bancorp’s filings with the Securities and Exchange Commission, including the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 and other documents that we file from time to time with the Securities and Exchange Commission as well as the following:

Current wording

When used in this Quarterly Report on Form 10-Q, statements regarding The Bancorp’s business, that are not historical facts, are “forward-looking statements.” These statements may be identified by the use of forward-looking terminology, including, but not limited to the words “intend,” “may,” “believe,” “will,” “expect,” “look,” “anticipate,” “plan,” “estimate,” “continue,” or similar words. Forward-looking statements include but are not limited to, statements regarding our annual fiscal 2026 results, increased growth, profitability, and volumes, and our ability to reallocate or reduce resources, and relate to our current assumptions, projections, and expectations about our business and future events, including current expectations about important economic, political, and technological factors, among other factors, and are subject to risks and uncertainties, which could cause the actual results, events, or achievements to differ materially from those set forth in or implied by the forward-looking statements and related assumptions. Factors that could cause results to differ from those expressed in the forward-looking statements also include, but are not limited to, the risks and uncertainties referenced or described in The Bancorp’s filings with the Securities and Exchange Commission, including the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of our 2025 Form 10-K and other documents that we file from time to time with the Securities and Exchange Commission as well as the following:

Previous wording

our focus on growth in fintech solutions and its future potential impact on our operations and financial condition may result in new operational, legal and financial risks;

Current wording

•our focus on growth in fintech solutions and investing in our infrastructure, including through artificial intelligence tools to gain efficiency and productivity, and the future potential impact on our operations and financial condition may result in new operational, legal and financial risks;

Previous wording

We are a Delaware financial holding company, and our primary, wholly-owned subsidiary is The Bancorp Bank, National Association. The Bank is a federally chartered commercial bank located in Sioux Falls, South Dakota and is a FDIC insured institution. Most of our revenue and income is currently generated through the Bank. An overview of our operations follows, including discussion of Fintech Solutions and Credit Solutions.

Current wording

We are a Delaware financial holding company, and our primary, wholly owned subsidiary is The Bancorp Bank, National Association. The Bank is a federally chartered commercial bank located in Sioux Falls, South Dakota and is an FDIC insured institution. Most of our revenue and income is currently generated through the Bank. An overview of our operations follows, including discussion of Fintech Solutions and Credit Solutions.

Previous wording

Deposits generated through these partner relationships are deployed into loan and lease products offered by both Fintech sponsored lending and the Credit Solutions business line. As of March 31, 2026, 93% of our total deposits were sourced from the Fintech Solutions business, primarily from program sponsorship.

Current wording

Deposits generated through these partner relationships are deployed into loan and lease products offered by both Fintech sponsored lending and the Credit Solutions business line. As of June 30, 2026,96% of our total deposits were sourced from the Fintech Solutions business, primarily from program sponsorship.

Previous wording

We remain focused on growing our fintech revenues through new partnerships, products and services. Fintech loans of $1.65 billion as of March 31, 2026 increased 50% compared to the $1.10 billion balance at December 31, 2025 and increased 187% compared to the March 31, 2025 balance of $574.0 million. Certain loan fees on fintech loans are recorded as non-interest income and totaled $5.6 million for the quarter ended March 31, 2026 compared to $3.6 million for the quarter ended March 31, 2025.

Current wording

We remain focused on growing our fintech revenues through new partnerships, products and services. Fintech loans of $901.5 million as of June 30, 2026 increased 32% compared to the June 30, 2025 balance of $680.5 million. Certain loan fees on fintech loans are recorded as non-interest income and totaled $6.5 million for the quarter ended June 30, 2026, a 65% increase compared to $4.0 million for the quarter ended June 30, 2025.

Previous wording

We remain focused on returning capital through share repurchases and repurchased 843,061 shares of our common stock at an average cost of $59.31 per share during the quarter ended March 31, 2026. Primarily driven byshare repurchases, outstanding shares, net of treasury shares at March 31, 2026 decreased 1% to 41.859 million from 42.355 million shares at December 31, 2025.

Current wording

We remain focused on returning capital through share repurchases, and repurchased 870,129 shares of our common stock at an average cost of $57.46 per share during the quarter ended June 30, 2026. Primarily driven by share repurchases, outstanding shares, net of treasury shares at June 30, 2026 decreased 3% to 41.043 million from 42.355 million shares at December 31, 2025.

Previous wording

Our net income increased to $60.1 million in the first quarter of 2026 from $57.2 million in the first quarter of 2025, an increase of $2.9 million, or 5.1%.

Current wording

Our net income increased to $60.7 million in the second quarter of 2026 from $59.8 million in the second quarter of 2025, an increase of $0.9 million, or 1.4%.

Previous wording

Earnings per diluted share increased to $1.41 in the first quarter of 2026 from $1.19 in the first quarter of 2025, an increase of 18%, driven both by the increase in net income and a 5.4 million decrease in weighted average diluted shares, primarily driven by our share repurchase activity during the year.

Current wording

Earnings per diluted share increased to $1.45 in the second quarter of 2026 from $1.27 in the second quarter of 2025, an increase of 14.2%, driven both by the increase in net income and a 5.4 million decrease in weighted average diluted shares, primarily driven by our share repurchase activity during the year.

Previous wording

Non-interest income decreased $11.1 million, to $72.5 million inthe first quarter of 2026 from $83.6 million in the first quarter of 2025. That decrease includes a $17.0 million decrease in Fintech loan credit enhancement income driven by improved performance of fintech loans, partially offset by a $3.6 million increase in total fintech fees primarily driven by volume growth, and a $2.7 million increase in other non-interest income driven by higher other fee income on loans and deposit sweep income.

Current wording

•Non-interest income decreased $10.7 million, to $73.0 million in the second quarter of 2026 from $83.7 million in the second quarter of 2025. That decrease is driven by a $17.4 million decrease in Fintech loan credit enhancement income driven by improved performance of fintech loans, partially offset by a $5.3 million increase in total fintech fees primarily driven by volume growth, and a $2.1 million increase in other non-interest income driven by higher other fee income on loans and deposit sweep income.

Previous wording

Provision for credit losses, total decreased $19.3 million, to $27.6 million in the first quarter of 2026, from $46.9 million in the first quarter of 2025. That decrease includes $17.0 million decrease in provision for fintech loans, which directly relates to the credit enhancement income decrease outlined above. The remaining decrease in total provision between periods was $2.3 million, primarily driven by a recovery booked in the first quarter of 2026 as a result of improved credit in our direct lease financing portfolio.

Current wording

•Provision for credit losses, total decreased $18.3 million, to $26.1 million in the second quarter of 2026, from $44.4 million in the second quarter of 2025. That decrease includes a $17.4 million decrease in provision for fintech loans, which directly relates to the credit enhancement income decrease outlined above. See further discussion of fintech loans and the related credit enhancement in “Financial Condition—Total Loan Portfolio—Fintech Programs” in this MD&A.

Previous wording

Average loans and leases grew to $7.25 billion in the first quarter of 2026 from $6.39 billion in the first quarter of 2025, an increase of $868.5 million or 13.6%, primarily driven by a $648.3 million increase in our average fintech portfolio, reflecting our continued strategic shift towards sponsored lending.

Current wording

Average loans and leases grew to $7.63 billion in the second quarter of 2026 from $6.57 billion in the second quarter of 2025, an increase of $1.06 billion or 16.1%, primarily driven by a $853.9 million increase in our average fintech portfolio, reflecting our continued strategic shift towards sponsored lending.

Previous wording

Non-interest income—consumer credit fintech fees increased to $5.6 million in the first quarter of 2026, up 55.4% from $3.6 million in the first quarter of 2025 which reflected continued organic volume growth with existing partners and products and the impact of new products launched within the past year. Prepaid and debit card gross dollar volume (“GDV”) increased to $52.51 billion, up 17.6% from $44.65 billion in the first quarter of 2025, which directly contributed to a $1.0 million, or 3.7%, increase in Prepaid, debit card and related fees within Non-interest income—fintech fees. GDV growth may not have a direct impact on the related fee income due to the different product fee structures within the total mix.

Current wording

Non-interest income fintech fees increased $5.3 million, or 14.7%, to $40.9 million in the second quarter of 2026, which includes a $2.5 million increase in consumer credit fintech fees and a $2.7 million increase in prepaid, debit card, ACH and other fees. The growth in consumer credit fintech fees reflects continued organic volume growth with existing partners and products and the impact of new products launched within the past year. The growth in prepaid, debit card and related fees is driven by an increase in gross dollar volume (“GDV”) to $53.5 billion, a 22.5% increase from $43.6 billion in the second quarter of 2025. GDV growth may not have a direct impact on the related fee income due to the different product fee structures within the total mix.

Previous wording

Net interest margin decreased to 3.87% in the first quarter of 2026 from 4.07% in the first quarter of 2025, driven by the shift in our loan portfolio to a greater percentage of fintech loans, for which we primarily earn fee income and not interest income, combined with the impact of Federal Reserve rate decreases from the third quarter of 2025. See further discussion of the growth in Fintech lending contributing to margin compression under “Results of Operations—Net Interest Income—Growth of Fintech Lending” in the following section.

Current wording

Net interest margin decreased to 3.85% in the second quarter of 2026 from 4.44% in the second quarter of 2025, driven by the shift in our loan portfolio to a greater percentage of fintech loans, for which we primarily earn fee income and not interest income, combined with the impact of Federal Reserve rate decreases from the third and fourth quarters of 2025. See further discussion of the growth in Fintech lending contributing to margin compression under “Results of Operations—Net Interest Income—Growth of Fintech Lending” in the following section.

Previous wording

Our efforts to return capital to shareholders through share repurchases had an impact on our ratio of equity to assets. At March 31, 2026, the ratio of equity to assets was 7.04%, compared to 7.38% at December 31, 2025, primarily driven by reductions in equity from share repurchases partially offset by an increase in equity capital from retained earnings.

Current wording

Our efforts to return capital to shareholders through share repurchases have had an impact on our ratio of equity to assets. At June 30, 2026, the ratio of equity to assets was 7.65%, compared to 7.38% at December 31, 2025, primarily driven by reductions in equity from share repurchases partially offset by an increase in equity capital from retained earnings.

Previous wording

Growth of Fintech Lending. Our strategy is to continue to drive growth in our Fintech lending business, as seen in the mix shift of our loan portfolio to 15.4% of average loans in the first quarter 2026, compared to 7.3% at the end of the first quarter of 2025. A significant portion of these loans are zero percent interest and, as such, do not recognize interest income, however we do generate fee revenue from these loans, through our partnership agreements. This mix shift to non-interest earning loans results in a reduction of the calculated average rate earned by total loans, average rate earned by our net interest-earning assets, and net interest margin in the above analysis. Offsetting these impacts is the growth in Consumer fintech fee income recognized within non-interest income in our Consolidated Statements of Operations which was $5.6 million and $3.6 million for the first quarters of 2026 and 2025, respectively.

Current wording

Growth of Fintech Lending. Our strategy is to continue to drive growth in our Fintech lending business, as seen by the shift in mix to Fintech representing 18.2% of our total average loan portfolio in the second quarter of 2026, compared to 8.2% for the second quarter of 2025. A significant portion of these loans are zero percent interest and, as such, do not recognize interest income, however we do generate fee revenue from these loans, through our partnership agreements. This mix shift to non-interest earning loans results in a reduction of the calculated average rate earned by total loans, average rate earned by our total interest-earning assets, and net interest margin in the above analysis. Offsetting these impacts is the growth in Consumer fintech fee income recognized within non-interest income in our Consolidated Statements of Operations which was $6.5 million and $4.0 million for the second quarters of 2026 and 2025, respectively.

Previous wording

We expect to continue to increase the proportion of Fintech loans in our portfolio in 2026 and beyond, and therefore we expect to see continued compression in our average rate earned on loans, and net interest margin, as the mix of fintech loans continues to grow. However, we also expect growth in our fintech fees within non-interest income driven by the increase in that portfolio.

Current wording

We expect to continue to increase the proportion of Fintech loans in our portfolio through the remainder of 2026 and beyond, and therefore we expect to see continued compression in our average rate earned on loans, and net interest margin, as the mix of fintech loans continues to grow. However, we also expect growth in our fintech fees within non-interest income driven by the increase in that portfolio.

Previous wording

Interest income for the first quarter of 2026 was $129.8 million, a decrease of $10.0 million from $139.8 million in the first quarter of 2025, primarily driven by $10.5 million lower income on interest-earning deposits. In the first quarter of 2025, average deposits on balance sheet from customers of $1.14 billion was significantly higher than $250.0 million in first quarter of 2026, driven by one-time volumes from wildfire insurance refunds and higher fintech on-balance sheet volumes. This higher interest income on interest earning cash deposits directly correlates to higher interest expense paid on deposits, discussed further below.

Current wording

Interest income for the second quarter of 2026 was $132.0 million, a decrease of $11.1 million from $143.1 million in the second quarter of 2025, primarily drivenby$6.9 million lower income on interest-earning deposits and a one-time gain in 2025 of $3.0 million from a CRE-2 investment security, which was repaid in full. In the second quarter of 2025, average deposits on balance sheet from customers of $756.6 million wassignificantly higher than $155.5 million in second quarter of 2026, driven by higher fintech on-balance sheet volumes.

Previous wording

Interest income from loans was $107.5 million in the first quarter of 2026, $1.4 million lower than $108.9 million in the first quarter of 2025, driven by $3.0 million lower interest earned on non-fintech loans partially offset by $1.6 million higher interest earned on fintech loans. For non-fintech loans, lower interest earned was primarily driven by lower rates, as the average rate decreased to 6.89% for first quarter of 2026, compared to 7.34% for first quarter of 2025, while average balance was 3.7% higher. The loan portfolio is reflecting the impact of Federal Reserve rate decreases which continued in the third quarter of 2025. For fintech loans, higher interest income of $1.6 million was driven by higher volumes of fintech loans. See “Growth of Fintech Lending” discussion above for further information.

Current wording

Interest income from loans was $110.6 million in the second quarter of 2026, $1.7 million lower than $112.3 million in the second quarter of 2025, driven by $4.1 million lower interest earned on non-fintech loans partially offset by $2.3 million higher interest earned on fintech loans. For non-fintech loans, lower interest earned was primarily driven by lower rates, as the average rate decreased to 6.91% for the second quarter of 2026, compared to 7.42% for the second quarter of 2025, while average balance was 3.4% higher. The loan portfolio average rate reflects the impact of Federal Reserve rate decreases which continued in the third and fourth quarters of 2025. For fintech loans, higher interest income of $2.3 million was driven by higher volumes of interest-earning fintech loans. See “Growth of Fintech Lending” discussion above for further information.

Previous wording

For the first quarter of 2026 compared to first quarter of 2025, average interest-earning assets increased $159.4 million, reflecting an $867.5 million increase in average loans and a $177.3 million increase in average investment securities, partially offset by a decrease in average interest-earning deposits of $886.4 million. For those respective periods, average deposits and liabilities increased $250.8 million, primarily driven by a $145.9 million increase in short-term borrowings and a $100.0 million increase in senior debt.

Current wording

For the second quarter of 2026 compared to second quarter of 2025, average interest-earning assets increased $620.5 million, reflecting a $1.06 billion increase in average loans and leases and a $161.4 million increase in average investment securities, partially offset by a decrease in average interest-earning deposits of $601.1 million. For those respective periods, average deposits and liabilities increased $755.3 million, driven by a $357.2 million increase in deposits, $301.8 million increase in short-term borrowings and a $100.1 million increase in senior debt.

Previous wording

Our net interest margin (calculated by dividing net interest income by average interest-earning assets) for the first quarter of 2026 was 3.87% compared to 4.07% for the first quarter of 2025, a decrease of 20 basis points. The average yield on interest-earning assets decreased 54 basis points, due to the shift of our portfolio mix to more fintech loans where we primarily earn fee income as discussed further under “Growth of Fintech Lending”above, plus lower market short-term interest rates. In addition, the cost of deposits and interest-bearing liabilities decreased 39 basis points, or a net change of 15 basis points, driven primarily by a 53 basis point decrease in average rate on deposits primarily due to a lower rate environment in the first quarter of 2026.

Current wording

Our net interest margin (calculated by dividing net interest income by average interest-earning assets) for the second quarter of 2026 was 3.85% compared to 4.44% for the second quarter of 2025, a decrease of 59 basis points. The average yield on interest-earning assets decreased 90 basis points, due to the shift of our portfolio mix to more fintech loans where we primarily earn fee income as discussed further under “Growth of Fintech Lending”above, plus lower market short-term interest rates. In addition, the cost of deposits and interest-bearing liabilities decreased 37 basis points, or a net change of 53 basis points, driven primarily by a 55 basis point decrease in average rate on deposits primarily due to a lower rate environment in the second quarter of 2026.

Previous wording

Our provision for credit losses was $27.6 million for the first quarter of 2026, a decrease of $19.3 million compared to a provision of $46.9 million for the first quarter of 2025. The decrease is primarily attributable to $17.0 million lower provision for fintech loans driven by improved performance of that loan portfolio. The lower fintech loan provision correlates to a lower amount of related non-interest income from a credit enhancement contractually provided by a third party. Accordingly, there have been no related net impact from these amounts. See further discussion of this program in “Financial Condition—Allowance for Credit Loss—Fintech Programs” in MD&A.

Current wording

Our provision for credit losses was $26.1 million for the second quarter of 2026, a decrease of $18.3 million compared to a provision of $44.4 million for the second quarter of 2025. The decrease is primarily attributable to $17.4 million lower provision for fintech loans driven by improved performance of that loan portfolio. The lower fintech loan provision correlates to a lower amount of related non-interest income from a credit enhancement contractually provided by a third party. Accordingly, there was no related net impact from these amounts. See further discussion of this program in “Financial Condition—Allowance for Credit Loss—Fintech Programs” in MD&A.

Previous wording

Non-interest income was $72.5 million in the first quarter of 2026, a decrease of $11.1 million compared to $83.6 million in the first quarter of 2025. The decrease between those respective periods is primarily driven by a $17.0 million decrease infintech loan credit enhancement income, which was partially offset by $3.6 million in higher total fintech fees and $2.7 million of higher other non-interest income.

Current wording

Non-interest income was $73.0 million in the second quarter of 2026, a decrease of $10.7 million compared to $83.7 million in the second quarter of 2025. The decrease between those respective periods is primarily driven by a $17.4 million decrease infintech loan credit enhancement income, which was partially offset by$5.3 million in higher total fintech fees and $2.1 million of higher other non-interest income.

Previous wording

Fintech loan credit enhancement income decreased $17.0 million driven by improved performance of fintech loans, which correlates to a like amount for provision for credit losses on fintech loans. See further discussion above under “Provision for Credit Losses”.

Current wording

Fintech loan credit enhancement income decreased$17.4 million driven by improved performance of fintech loans, which correlates to a like amount for provision for credit losses on fintech loans. See further discussion above under “Provision for Credit Losses.”

Previous wording

Total fintech fees increased $3.6 million, which includes a $1.0 million increase in prepaid, debit card and related fees, or 3.7%, to $26.7 million for the first quarter of 2026, compared to $25.7 million in the first quarter of 2025, driven by higher transaction volume from new clients and organic growth from existing clients. In addition, ACH, card and other payment processing fees increased $0.7 million, or 12.9%, to $5.8 million for the first quarter of 2026, compared to $5.1 million in the first quarter of 2025, reflecting an increase in rapid funds transfer volume. Consumer credit fintech fees increased $2.0 million to $5.6 million for the first quarter of 2026, compared to $3.6 million in the first quarter of 2025, reflecting increased loan volume.

Current wording

Total fintech fees increased $5.3 million, which includes a $1.7 million increase in prepaid, debit card and related fees, or 6.4%, to $27.8 million for the second quarter of 2026, compared to $26.1 million in the second quarter of 2025, driven byhigher transaction volume from new clients and organic growth from existing clients. In addition, ACH, card and other payment processing fees increased $1.0 million, or 17.9%, to $6.6 million for the second quarter of 2026, compared to $5.6 million in the second quarter of 2025, reflecting an increase in rapid funds transfer volume. Consumer credit fintech fees increased $2.5 million, or 64.9%, to $6.5 million for the second quarter of 2026, compared to $4.0 million in the second quarter of 2025, reflecting increased loan volume.

Previous wording

Other non-interest income increased $2.7 million for the first quarter of 2026, compared to the first quarter of 2025, primarily driven by $1.1 million higher other fee income from loans and $0.9 million of fees earned on deposit sweeps.

Current wording

Other non-interest income increased $2.1 million for the second quarter of 2026, compared to the second quarter of 2025, primarily driven by $1.3 million higher other fee income from loans and $0.7 million of fees earned on deposit sweeps.

Previous wording

Income tax expense was $18.6 million for the first quarter of 2026 compared to $18.1 million in the first quarter of 2025. A 23.7% effective tax rate and a 24.0% effective tax rate in the first quarters of 2026 and 2025, respectively, based on a 21% federal tax rate and the impact of various state income taxes. The tax rate in the first quarter of the year is typically lower than our full-year effective rate, which was 24.7% for full year 2025, due to the tax impact of stock-based compensation activity from the first quarter of each year.

Current wording

Income tax expense was $20.3 million for the second quarter of 2026 compared to $19.8 million in the second quarter of 2025. Our effective tax rate was 25.1%, and 24.9% in the second quarters of 2026 and 2025, respectively, based on a 21% federal tax rate and the impact of various state income taxes.

Previous wording

Interest expense for the first quarter of 2026 decreased $7.1 million to $41.0 million from $48.1 million in the first quarter of 2025, driven by $11.1 million lower interest expense on deposits, partially offset by $1.4 million higher interest on short-term borrowings and $2.6 million higher interest expense on senior debt. Interest expense on deposits was $11.1 million higher in 2025 due to the higher on-balance sheet deposits related to wildfire insurance refunds and higher fintech balances, and directly correlates to higher income on interest earning cash deposits as discussed above under interest income. Interest expense on short-term deposits was $1.4 million higher in 2026, as that funding source was utilized to fund higher average loans on balance sheet in the first quarter of 2026 and that funding source was not utilized at all in first quarter 2025. Interest expense on senior debt was $2.6 million higher, due to higher outstanding principal and higher rate on senior debt. In August 2025, $200 million of 7.375% Senior Notes due 2030 were issued, the proceeds of which were used in part to repay at maturity the $100 million of outstanding 4.75% Senior notes due 2025.

Current wording

Interest expense on deposits was $20.7 million lower due to higher average balance of deposits in 2025 related to wildfire insurance refunds, and lower rates in 2026. Interest expense on short-term borrowings was $4.3 million higher in 2026, as that funding source was utilized to fund higher average loans on balance sheet in the six months ended June 30, 2026, compared to limited utilization in 2025. Interest expense on senior debt was $5.3 million higher, due to higher outstanding principal and higher rate on senior debt. In August 2025, $200 million of 7.375% Senior Notes due 2030 were issued, the proceeds of which were used in part to repay at maturity the $100 million of outstanding 4.75% Senior notes due 2025.

Previous wording

In addition, the provision for credit losses on non-fintech loans was a reversal of $1.3 million in the first quarter of 2026 compared to provision expense of $0.9 million in the first quarter of 2025. The provision reversal in the first quarter of 2026 is primarily driven by improvements in credit quality of the direct lease financing portfolio.

Current wording

In addition, the provision for credit losses on non-fintech loans was a release of $1.0 million in the six months ended June 30, 2026 compared to provision expense of $2.4 million in the six months ended June 30, 2025. The provision release in the six months ended June 30, 2026 is primarily driven by improvements in credit quality of the direct lease financing portfolio.

Previous wording

Total non-interest expense was $55.0 million for the first quarter of 2026, an increase of $1.7 million, or 3.2%, compared to $53.3 million for the first quarter of 2025. The increase reflects $3.8 million higher salaries and benefits expense primarily driven by higher costs from incentive compensation accruals and costs related to organization changes, partially offset by a $2.0 million reimbursement from insurance in the first quarter of 2026 related to a legal settlement that was previously expensed in fourth quarter of 2025.

Current wording

Total non-interest expense was $111.5 million for the six months ended June 30, 2026, an increase of $1.0 million, or 0.9%, compared to $110.5 million for the six months ended June 30, 2025. Theincrease reflects$4.1 million higher salaries and benefits expense primarily driven by higher costs from incentive compensation accruals and costs related to organization changes, partially offset by a $2.0 million legal settlement reimbursement from insurance in the first quarter of 2026 related to a legal settlement that was previously expensed in fourth quarter of 2025 and a $1.0 million decrease in legal expense due to higher costs in 2025 for payments related matters and regulatory filings.

Previous wording

Total assets at March 31, 2026 were $9.90 billion, a $546.3 million increase from $9.35 billion at December 31, 2025. The change in total assets was primarily driven by a $637.0 million increase in our total loan portfolio.

Current wording

Total assets at June 30, 2026 were $9.22 billion, a $136.4 million decrease from $9.35 billion at December 31, 2025. The change in total assets was primarily driven by a $40.1 million decrease in our total loan portfolio and a $56.9 million decrease in investment securities.

Previous wording

(1)As of both March 31, 2026 and December 31, 2025, Other loans includes $110.7 million related to warehouse financing related to loan sales to third-party purchasers of real estate bridge loans.

Current wording

(2) As of June 30, 2026 and December 31, 2025, Other loans includes $110.0 million and $110.7 million, respectively, related to warehouse financing of REBL loan sales to third-party purchasers.

Previous wording

The majority of our loan portfolio is loans recorded at amortized cost, which are recognized net of an allowance for credit loss. Loans, net of deferred loan fees and costs increased to $7.75 billion at March 31, 2026 from $7.12 billion at December 31, 2025. This$637.0 million increase is primarily driven by growth in fintech loans of $548.6 million, and a $90.5 million increase in REBL loans.

Current wording

The majority of our loan portfolio is recorded at amortized cost and recognized net of an allowance for credit loss. Loans, net of deferred loan fees and costs decreased to $7.07 billion at June 30, 2026 from $7.12 billion at December 31, 2025. This$42.8 million decrease is primarily driven by a decrease in fintech loans of$196.5 million, partially offset by a $155.3 million increase in SBLOC/IBLOC. The decline in fintech loans was primarily attributable to a change in payment processing, which impacted period-end balances and did not reflect a change in underlying customer activity.

Previous wording

Commercial loans, at fair value are comprised of non-SBA commercial real estate loans and SBA loans which had been originated for sale or securitization through the first quarter of 2020, and which are now being held for investment on the balance sheet. These loans continue to be recognized at fair value, and this portfolio declined $11.1 million from December 31, 2025, as this portfolio continues to runoff. All originations are now being recognized at amortized cost.

Current wording

Commercial loans, at fair value are comprised of non-SBA commercial real estate loans and SBA loans which had been originated for sale or securitization through the first quarter of 2020, and which are now being held for investment on the balance sheet. These loans continue to be recognized at fair value, and this portfolio declined $25.2 million from December 31, 2025, as this portfolio continues to runoff. All originations are now being recognized at amortized cost.

Previous wording

Real estate bridge loans are primarily collateralized by apartment buildings, or other commercial real estate; and

Current wording

•REBL are primarily collateralized by apartment buildings, or other commercial real estate; and

Previous wording

Fintech loans include secured credit card accounts of $1.22 billion and $729.1 million as of March 31, 2026 and December 31, 2025, respectively, which are backed dollar-for-dollar by cash collateral by each individual cardholder that are recognized as deposits on our Condensed Consolidated Balance Sheets, and these loans are required to be repaid in-full monthly. The remaining fintech loans consist of cashflow underwritten short-term liquidity products to individual borrowers ranging in maturities from 30 to 365 days. All fintech loans are covered by credit enhancement agreements, as discussed further below under“Fintech Programs.”

Current wording

Fintech loans include secured credit card accounts of $336.3 million and $729.1 million as of June 30, 2026 and December 31, 2025, respectively, which are backed dollar-for-dollar by cash collateral by each individual cardholder that are recognized as deposits on our Condensed Consolidated Balance Sheets, and these loans are required to be repaid in full monthly. The remaining fintech loans consist of cashflow underwritten short-term liquidity products to individual borrowers ranging in maturity from 30 to 365 days. All fintech loans are covered by credit enhancement agreements, as discussed further below under“Fintech Programs.”

Previous wording

The following table summarizes the concentration by state of our real estate bridge loans as of March 31, 2026 (dollars inthousands):

Current wording

The following table summarizes the concentration by state of our real estate bridge loans (dollars inthousands):

Previous wording

Non-accrual loans increased $17.1 million, primarily driven by a $12.7 million increase in REBL loans and $4.4 million increase in SBL commercial mortgage.

Current wording

Non-accrual loans increased $16.6 million, primarily driven by a $12.7 million increase in REBL loans and $4.9 million increase in SBL commercial mortgage.

Previous wording

Loans past due 90 days or more still accruing interest amounted to $2.2 million at March 31, 2026 and $18.2 million at December 31, 2025. The $16.0 million decrease is primarily driven by a $14.5 million REBL loan that left 90 days or more past due status after we entered into a loan agreement with a new borrower with greater financial capacity.

Current wording

Loans past due 90 days or more still accruing interest amounted to $2.3 million at June 30, 2026 and $18.2 million at December 31, 2025. The $15.9 million decrease is primarily driven by a $14.5 million REBL loan that left 90 days or more past due status after we entered into a loan agreement with a new borrower with greater financial capacity.

Previous wording

We evaluate loans under an internal loan risk rating system as a means of identifying problem loans. At March 31, 2026, there were $163.1 million of loans classified as special mention and substandard in total, a decrease of$31.4 million, or 16%, from $194.5 million at December 31, 2025. The decrease is primarily driven by a $24.4 million decrease in criticized Real estate bridge loans, and a $6.3 million decrease in criticized small business commercial mortgage loans.

Current wording

We evaluate loans under an internal loan risk rating system as a means of identifying problem loans. At June 30, 2026, there were $146.7 million of loans classified as special mention and substandard in total, a decrease of $47.8 million, or 24.6%, from $194.5 million at December 31, 2025. The decrease is primarily driven by a $37.3 million decrease in criticized Real estate bridge loans.