NewtekOne, Inc.

Previous wording

•our current intent to re-evaluate our business model, which will includes holding larger amounts of guaranteed portions of SBA 7(a) loans on our balance sheet and relying less on the income earned from the sale of guaranteed portions of SBA 7(a) loans in the secondary market, could negatively impact our revenues and business;

Current wording

•our current intent to re-evaluate our business model, which will include holding larger amounts of guaranteed portions of SBA 7(a) loans on our balance sheet and relying less on the income earned from the sale of guaranteed portions of SBA 7(a) loans in the secondary market, could negatively impact our revenues and business;

Previous wording

•changes to the SBA 7(a) loan program, including revisions to SBA Standard Operating Procedure (“SOP”), could materially and adversely affect Newtek Bank’s participation in the SBA 7(a) loan program and could negatively impact our revenues; and

Current wording

•changes to the SBA 7(a) loan program, including revisions to SBA Standard Operating Procedure (“SOP”), could materially and adversely affect Newtek Bank’s participation in the SBA 7(a) loan program and could negatively impact our revenues;

Previous wording

The following discussion should be read in conjunction with our consolidated financial statements and related notes and other financial information appearing elsewhere in this report. In addition to historical information, the following discussion and other parts of this report contain forward-looking information that involves risks and uncertainties. Although we believe that the assumptions on which these forward-looking statements are based are reasonable, any of those assumptions could prove to be inaccurate, and as a result, the forward-looking statements based on those assumptions also could be inaccurate. Important assumptions include the ability of Newtek Bank to originate loans under the SBA 7(a) program, maintain PLP status, sell SBA guaranteed portions of SBA 7(a) loans at premiums and grow deposits; our ability to originate new loans; our subsidiaries’ ability to generate revenue and obtain and maintain certain margins and levels of profitability; and the availability of additional capital. In light of these and other uncertainties, the inclusion of a projection or forward-looking statement in this report, including the documents that we incorporate by reference herein, should not be regarded as a representation by us that our plans and objectives will be achieved. Our actual results could differ materially from those anticipated by such forward-looking information due to the factors discussed under Part II “Item 1A. Risk Factors” of this quarterly report on Form 10-Q and “Item 1A. Risk Factors” of our 2025 Form 10-K, and in any subsequent filings we have made with the SEC that are incorporated by reference into this report.

Current wording

The following discussion should be read in conjunction with our consolidated financial statements and related notes and other financial information appearing elsewhere in this report. In addition to historical information, the following discussion and other parts of this report contain forward-looking information that involves risks and uncertainties. Although we believe that the assumptions on which these forward-looking statements are based are reasonable, any of those assumptions could prove to be inaccurate, and as a result, the forward-looking statements based on those assumptions also could be inaccurate. Important assumptions include the ability of Newtek Bank to originate loans under the SBA 7(a) program, maintain PLP status, sell guaranteed portions of SBA 7(a) loans at premiums and grow deposits; our ability to originate new loans; our subsidiaries’ ability to generate revenue and obtain and maintain certain margins and levels of profitability; and the availability of additional capital. In light of these and other uncertainties, the inclusion of a projection or forward-looking statement in this report, including the documents that we incorporate by reference herein, should not be regarded as a representation by us that our plans and objectives will be achieved. Our actual results could differ materially from those anticipated by such forward-looking information due to the factors discussed under Part II “Item 1A. Risk Factors” of this quarterly report on Form 10-Q and “Item 1A. Risk Factors” of our 2025 Form 10-K, and in any subsequent filings we have made with the SEC that are incorporated by reference into this report.

Previous wording

Our loan products include SBA 7(a), SBA 504, traditional C&I loans, C&I LA loans, CRE loans and ABL loans. Newtek Bank is a national bank and, as a nationally licensed SBA lender under the SBA 7(a) Program, originates, sells and services SBA 7(a) loans. Newtek Bank has been granted PLP status and is authorized to place SBA guarantees on loans without seeking prior SBA review and approval. Being a national SBA 7(a) lender with PLP status allows Newtek Bank to expedite the origination of SBA 7(a) loans since Newtek Bank is not required to present applications to the SBA for concurrent review and approval. A government failure to fund the SBA or the loss of the SBA 7(a) lending license or PLP status would adversely impact our marketing efforts and ultimately our loan origination volume, which would negatively impact our results of operations. See “ITEM 1A. RISK FACTORS - Risks Related to SBA Lending.

Current wording

Our loan products include SBA 7(a), SBA 504, traditional C&I loans, C&I LA loans, CRE loans and ABL loans. Newtek Bank is a national bank and, as a nationally licensed SBA lender under the SBA 7(a) Program, originates, sells and services SBA 7(a) loans. Newtek Bank has been granted PLP status and is authorized to place SBA guarantees on loans without seeking prior SBA review and approval. Being a national SBA 7(a) lender with PLP status allows Newtek Bank to expedite the origination of SBA 7(a) loans since Newtek Bank is not required to present applications to the SBA for concurrent review and approval. A government failure to fund the SBA or the loss of the SBA 7(a) lending license or PLP status would adversely impact our marketing efforts and our loan origination volume, which would negatively impact our results of operations. See “ITEM 1A. RISK FACTORS - Risks Related to SBA Lending.

Previous wording

Our process to extend credit to borrowers begins with technology but finishes with credit committee approval. For SBA7(a) loans, we hold the unguaranteed portion and we both sell portions guaranteed by the SBA for premiums and also hold guaranteed portions on our balance sheet to earn interest income. Unlike traditional financial and bank holding companies, the majority of our income has been historically driven and influenced by noninterest income, specifically gains on sales and market value adjustments on loans. Going forward, we intend to rely less on gain on sales and more on interest income. There can be no guarantee that we will continue to earn revenue from the sales of guaranteed portions of SBA 7(a) loans at the historic levels we have in the past. We sell certain loans servicing retained, in which case we record a servicing asset that could increase our gain on sale and provides a stream of future income to the extent the loan balance continues to be outstanding.

Current wording

Our process to extend credit to borrowers begins with technology but finishes with credit committee approval. For SBA7(a) loans, we hold the unguaranteed portion and we both sell portions guaranteed by the SBA for premiums and also hold guaranteed portions on our balance sheet to earn interest income. Unlike traditional financial and bank holding companies, the majority of our income has been historically driven and influenced by noninterest income, specifically gains on sales and market value adjustments on loans. Going forward, we intend to rely less on gain on sales and more on recurring interest income. There can be no guarantee that we will continue to earn revenue from the sales of guaranteed portions of SBA 7(a) loans at the historic levels we have in the past. We sell certain loans servicing retained, in which case we record a servicing asset that could increase our gain on sale and provides a stream of future income to the extent the loan balance continues to be outstanding.

Previous wording

The migration of our lending activities into Newtek Bank reflects a deliberate transition from capital-markets- and warehouse-funded origination to a deposit-funded model. During the three and six months ended June 30, 2026 our average cost of total deposits was 3.75% and 3.73%, respectively, compared to an average cost of borrowings of 9.13% and 8.90%. We expect this shift toward lower-cost deposit funding to remain a primary driver of our funding profile as the wind-down of NSBF’s legacy portfolio progresses.

Current wording

The migration of our lending activities into Newtek Bank reflects a deliberate transition from capital-markets- and warehouse-funded origination to a deposit-funded model. During the three and nine months ended September 30, 2026 our average cost of total deposits was 3.92% and 3.74%, respectively, compared to an average cost of borrowings of 8.90% and 8.87%. We expect this shift toward lower-cost deposit funding to remain a primary driver of our funding profile as the wind-down of NSBF’s legacy portfolio progresses.

Previous wording

For the quarterly period ended June 30, 2026, we generated income in the form of interest, net gains on the sales of loans originated (which primarily include sales of SBA 7(a) and ALP loans) and related servicing assets on such sales, dividends, electronic payment processing income, servicing income, other fee income generated by loan originations and by our subsidiaries. In some instances, we received payments on our loans based on scheduled amortization of the outstanding balances. In addition, we received repayments of some of our loans prior to their scheduled maturity date. The frequency or volume of these repayments fluctuated significantly from period to period. Our portfolio activity for the quarterly period ended June 30, 2026, also reflects the proceeds of sales of guaranteed portions of SBA 7(a) loans we originated. There can be no assurance that we will continue to earn revenue from the sales of guaranteed portions of SBA 7(a) loans at the historic levels we have in the past. In addition, we received servicing income related to the guaranteed portions of SBA 7(a) loans which we originated and sold into the secondary market as well as on the portfolios of ALP loans owned and then securitized by NCL JV (dissolved in September 2025), TSO JV and Newtek ALP Holdings. These recurring fees are outlined in servicing agreements and were recorded when earned. In addition, we generated revenue in the form of loan origination fees (packaging and legal fees) as well as loan prepayment and late fees. We recorded such fees related to loans held for sale as other income. Distributions of earnings from our joint ventures were evaluated to determine if the distribution was income, return of capital or realized gain.

Current wording

For the quarterly period ended September 30, 2026, we generated income in the form of interest and related servicing assets on such sales, dividends, electronic payment processing income, servicing income, other fee income generated by loan originations and by our subsidiaries. In some instances, we received payments on our loans based on scheduled amortization of the outstanding balances. In addition, we received repayments of some of our loans prior to their scheduled maturity date. The frequency or volume of these repayments fluctuate significantly from period to period. There can be no assurance that we will continue to earn revenue from the sales of guaranteed portions of SBA 7(a) loans at the historic levels we have in the past. In addition, we received servicing income related to the guaranteed portions of SBA 7(a) loans which we originated and sold into the secondary market as well as on the portfolios of ALP loans owned and then securitized by NCL JV (dissolved in September 2025), TSO JV and Newtek ALP Holdings. These recurring fees are outlined in servicing agreements and were recorded when earned. In addition, we generated revenue in the form of loan origination fees (packaging and legal fees) as well as loan prepayment and late fees. We recorded such fees related to loans HFS as other income. Distributions of earnings from our joint ventures were evaluated to determine if the distribution was income, return of capital or realized gain.

Previous wording

We recognized realized gains or losses on loans based on the difference between (1) the net proceeds from the disposition and any servicing assets recognized and (2) the cost basis of the loan without regard to unrealized gains or losses previously recognized. We recorded current period changes in fair value of loans and assets that were measured at fair value as a component of the net change in unrealized appreciation (depreciation) on the loans or servicing assets, as appropriate, as well as amortization and impairment, if any, of LCM servicing rights in the consolidated statements of income.

Current wording

We recognize realized gains or losses on loans based on the difference between (1) the net proceeds from the disposition and any servicing assets recognized and (2) the cost basis of the loan without regard to unrealized gains or losses previously recognized. We record current period changes in fair value of loans and assets that were measured at fair value as a component of the net change in unrealized appreciation (depreciation) on the loans or servicing assets, as appropriate, as well as amortization and impairment, if any, of LCM servicing rights in the consolidated statements of income.

Previous wording

Set forth below is a comparison of the results of operations for the six months ended June 30, 2026 and 2025.

Current wording

Set forth below is a comparison of the results of operations for the nine months ended September 30, 2026 and 2025.

Previous wording

For the six months ended June 30, 2026, the Company reported net income of $28.0 million, or $0.90 per diluted share, compared to net income of $23.1 million, or $0.87 per diluted share, for the six months ended June 30, 2025, an increase of 21.4%. The increase reflects the continued maturation of our bank-funded lending model. Net income in our Banking segment grew to $61.2 million from $20.0 million, total deposits increased $732.1 million during the six months ended June 30, 2026 and our subsidiary Newtek ALP Holdings closed the NALP Business Loan Trust 2026-1 securitization backed by $341.8 million of collateral. Net interest income increased to $32.2 million from $27.9 million, and the provision for credit losses declined to $21.7 million from $22.6 million as our allowance for credit losses stabilized following three years of reserve build associated with our 2023 adoption of CECL. Noninterest expense and noninterest income increased by $4.6 million and $5.2 million, respectively.

Current wording

For the nine months ended September 30, 2026, the Company reported net income of $38.7 million, or $1.24 per diluted share, compared to net income of $41.0 million, or $1.54 per diluted share, for the nine months ended September 30, 2025, a decrease of 5.5%. The decrease reflects that we are holding more guaranteed portions of SBA 7(a) loans on our balance sheet than we have in the past, which is having the anticipated effect of generating net interest income growth and transitioning the mix of revenue away from gain on sale income to recurring net interest income. Net income in our Banking segment grew to $90.5 million from $35.4 million, total deposits increased $1.1 billion during the nine months ended September 30, 2026 and our subsidiary Newtek ALP Holdings closed the NALP Business Loan Trust 2026-1 securitization backed by $341.8 million of collateral. Net interest income increased to $51.1 million from $42.4 million, and the provision for credit losses increased to $37.1 million from $30.3 million given portfolio growth, individually assessed reserves, and an increase in net charge offs as our portfolio seasons. Noninterest income decreased by $2.3 million and noninterest expense increased by $4.6 million.

Previous wording

The net increase in net income was attributable to the following items:

Current wording

The net decrease in net income was attributable to the following items:

Previous wording

Net interest margin decreased to 2.41% for the six months ended June 30, 2026 from 3.06% for the six months ended June 30, 2025.

Current wording

Net interest margin decreased to 2.42% for the nine months ended September 30, 2026 from 3.06% for the nine months ended September 30, 2025.

Previous wording

Interest income increased by $18.1 million for the six months ended June 30, 2026 from $74.4 million to $92.5 million when compared to the six months ended June 30, 2025. The increase was primarily due to an increase in the average balance of interest-earning assets of $857.3 million, partially offset by a decrease in the yield on interest earning assets from 8.17% to 6.92%.

Current wording

Interest income increased by $32.4 million for the nine months ended September 30, 2026 from $113.5 million to $145.9 million when compared to the nine months ended September 30, 2025. The increase was primarily due to an increase in the average balance of interest-earning assets of $966.2 million along with a decrease in the yield on interest earning assets from 8.18% to 6.91%.

Previous wording

Interest expense increased by $13.8 million for the six months ended June 30, 2026 from $46.6 million to $60.3 million when compared to the six months ended June 30, 2025. The increase was primarily due to an increase in the average balance of interest-bearing liabilities of $807.7 million, partially offset by a decrease in the cost on interest earning liabilities from 5.78% to 5.00%.

Current wording

Interest expense increased by $23.7 million for the nine months ended September 30, 2026 from $71.1 million to $94.8 million when compared to the nine months ended September 30, 2025. The increase was primarily due to an increase in the average balance of interest-bearing liabilities of $932.7 million along with a decrease in the cost on interest earning liabilities from 5.74% to 4.89%.

Previous wording

For the six months ended June 30, 2026 and 2025, there was a provision for credit losses of $21.7 million and $22.6 million, respectively.

Current wording

For the nine months ended September 30, 2026 and 2025, there was a provision for credit losses of $37.1 million and $30.3 million, respectively.

Previous wording

The $5.2 million increase in noninterest income when comparing the six months ended June 30, 2026 to six months ended June 30, 2025 was primarily due to a $26.7 million gain on residuals in securitization incurred in the six months ended June 30, 2026, an increase in other noninterest income of $10.4 million, and an increase in net gains on sales of loans of $9.4 million. These were partially offset by additional net losses on loans under the fair value option of $35.2 million.

Current wording

The $2.3 million decrease in noninterest income when comparing the nine months ended September 30, 2026 to nine months ended September 30, 2025 was primarily due to additional net losses on loans under the fair value option of $44.5 million and a decrease in electronic payment processing of $2.0 million. These were partially offset by an increase of $29.6 million in gain on residuals in securitization and an increase in other noninterest income of $16.7 million incurred in the nine months ended September 30, 2026.

Previous wording

The increase in net gain on residuals in securitizations was primarily due to the 2026-1 Securitization Trusts, which closed on January 21, 2026. To consummate transaction, $341.8 million of ALP loans held for sale at fair value were sold into the securitization trust at par. This resulted in $66.4 million of previously recorded gains on ALP loans under the fair value option to be reversed, which was a large driver of the increase in loss on loans under the fair value option. The residual in the securitization (represented by the ownership certificates) was then valued resulting in a gain that was netted against the transaction costs. Refer to NOTE 3—SECURITIZATIONS AND VARIABLE INTEREST ENTITIES in the accompanying notes to the consolidated financial statements for additional information.

Current wording

The increase in net gain on residuals in securitizations was primarily due to the 2026-1 Securitization Trusts, which closed on January 21, 2026. To consummate transaction, $341.8 million of ALP loans HFS at fair value were sold into the securitization trust at par. This resulted in $66.4 million of previously recorded gains on ALP loans under the fair value option to be reversed, which was a large driver of the increase in loss on loans under the fair value option. The residual in the securitization (represented by the ownership certificates) was then valued resulting in a gain that was netted against the transaction costs. Refer to NOTE 3—SECURITIZATIONS AND VARIABLE INTEREST ENTITIES in the accompanying notes to the consolidated financial statements for additional information.

Previous wording

The $4.6 million increase in noninterest expense when comparing the six months ended June 30, 2026 to the six months ended June 30, 2025 was primarily due to a $3.4 million increase in other loan origination and maintenance expense and a $1.9 million increase in salaries and employee benefits expense, partially offset by a decrease in professional services expense of $2.0 million. The increase in other loan origination and maintenance expense was due to the increase in loans originated during the period. The increase in salaries and employee benefits was primarily attributable to higher benefit costs, including medical and other insurance expenses. The decrease in professional fees period over period is primarily attributable to a decrease in audit and legal fees.

Current wording

The $4.6 million increase in noninterest expense when comparing the nine months ended September 30, 2026 to the nine months ended September 30, 2025 was primarily due to a $3.1 million increase in salaries and employee benefits expense, a $2.2 million increase in other loan origination and maintenance expense and an increase in other general and administrative costs of $1.3 million, partially offset by a decrease in professional services expense of $1.8 million. The increase in salaries and employee benefits was primarily attributable to higher benefit costs, including medical and other insurance expenses. The increase in other loan origination and maintenance expense was due to the increase in loans originated during the period. The decrease in professional fees period over period is primarily attributable to a decrease in audit and legal fees.

Previous wording

The banking segment includes Newtek Bank as well as its consolidated subsidiary SBL. The financial results include the origination, sale, and servicing of SBA 7(a) loans, SBA 504 loans, C&I loans, C&I LA loans, CRE loans and ABL loans. In addition, Newtek Bank offers depository services. The results include $40.9 million of net interest income during the six months ended June 30, 2026 compared to $27.3 million of net interest income during the six months ended June 30, 2025.

Current wording

The banking segment includes Newtek Bank as well as its consolidated subsidiaries SBL and PMT. The financial results include the origination, sale, and servicing of SBA 7(a) loans, SBA 504 loans, C&I loans, C&I LA loans, CRE loans and ABL loans. In addition, Newtek Bank offers depository services. The results include $67.1 million of net interest income during the nine months ended September 30, 2026 compared to $43.9 million of net interest income during the nine months ended September 30, 2025.

Previous wording

Net income for the segment declined to $9.1 million for the six months ended June 30, 2026 as compared to $38.1 million for the six months ended June 30, 2025. The decline in the net income reflects the cessation of loan originations at NALH. Because C&I LA loans are now originated at Newtek Bank, the origination fees associated with those loans are recognized in the Banking segment rather than in Alternative Lending. The segment also does not record interest income on newly originated loans. In addition, loans originated in 2026 are carried at fair value at Newtek Bank, so the segment recognizes no fair value premium on new originations.

Current wording

Net income for the segment declined to $8.8 million for the nine months ended September 30, 2026 as compared to $60.4 million for the nine months ended September 30, 2025. The decline in the net income reflects the cessation of loan originations at NALH. Because C&I LA loans are now originated at Newtek Bank, the origination fees associated with those loans are recognized in the Banking segment rather than in Alternative Lending. In addition, loans originated in 2026 are carried at fair value at Newtek Bank, so the segment recognizes no fair value premium on new originations.

Previous wording

Payments includes NMS, POS and Mobil Money. Within the segment’s results are $22.3 million of noninterest income for the six months ended June 30, 2026 resulting from marketing credit and debit card processing services, check approval services, processing equipment, and software, compared to $24.0 million during the six months ended June 30, 2025. The net income also included $14.5 million and $15.5 million of noninterest expense for the six months ended June 30, 2026 and 2025, respectively.

Current wording

Payments includes NMS, POS and Mobil Money. Within the segment’s results are $33.0 million of noninterest income for the nine months ended September 30, 2026 resulting from marketing credit and debit card processing services, check approval services, processing equipment, and software, compared to $35.9 million during the nine months ended September 30, 2025. The net income also included $21.5 million and $23.1 million of noninterest expense for the nine months ended September 30, 2026 and 2025, respectively.

Previous wording

Corporate and Other represents operations not considered to be reportable segments and/or general operating expenses of the Company, and includes the parent company, other non-bank subsidiaries including NIA, PMT, and elimination adjustments to reconcile the results of the operating segments to the consolidated financial statements prepared in conformity with GAAP.

Current wording

Corporate and Other represents operations not considered to be reportable segments and/or general operating expenses of the Company, and includes the parent company, other non-bank subsidiaries including NIA, and elimination adjustments to reconcile the results of the operating segments to the consolidated financial statements prepared in conformity with GAAP.

Previous wording

For the three months ended June 30, 2026, the Company reported net income of $14.6 million, or $0.47 per diluted share, compared to net income of $13.7 million, or $0.52 per diluted share, for the three months ended June 30, 2025. Net interest income increased to $15.0 million from $13.9 million, and the provision for credit losses increased to $12.1 million from $9.1 million as our allowance for credit losses stabilized following three years of reserve build associated with our 2023 adoption of CECL. Noninterest income and noninterest expense increased by $3.8 million and $1.5 million, respectively.

Current wording

For the three months ended September 30, 2026, the Company reported net income of $10.7 million, or $0.34 per diluted share, compared to net income of $17.9 million, or $0.67 per diluted share, for the three months ended September 30, 2025. Net interest income increased to $18.9 million from $14.5 million, and the provision for credit losses increased to $15.4 million from $7.7 million as our allowance for credit losses stabilized following three years of reserve build associated with our 2023 adoption of CECL. Noninterest income decreased by $7.5 million while noninterest expense remained relatively flat.

Previous wording

Net interest margin decreased to 2.15% for the three months ended June 30, 2026 from 2.98% for the three months ended June 30, 2025.

Current wording

Net interest margin decreased to 2.48% for the three months ended September 30, 2026 from 2.86% for the three months ended September 30, 2025.

Previous wording

Interest income increased by $9.8 million for the three months ended June 30, 2026 from $36.5 million to $46.3 million when compared to the three months ended June 30, 2025. The increase was primarily due to an increase in the average balance of interest-earning assets of $920.4 million, partially offset by a decrease in the yield on interest earning assets from 7.81% to 6.64%.

Current wording

Interest income increased by $14.3 million for the three months ended September 30, 2026 from $39.1 million to $53.4 million when compared to the three months ended September 30, 2025. The increase was primarily due to an increase in the average balance of interest-earning assets of $1.0 billion, partially offset by a decrease in the yield on interest earning assets from 7.68% to 7.01%.

Previous wording

Interest expense increased by $8.7 million for the three months ended June 30, 2026 from $22.6 million to $31.3 million when compared to the three months ended June 30, 2025. The increase was primarily due to an increase in the average balance of interest-bearing liabilities of $792.3 million, partially offset by a decrease in the cost on interest earning liabilities from 5.16% to 4.93%.

Current wording

Interest expense increased by $9.9 million for the three months ended September 30, 2026 from $24.5 million to $34.5 million when compared to the three months ended September 30, 2025. The increase was primarily due to an increase in the average balance of interest-bearing liabilities of $1.0 billion, partially offset by a decrease in the cost on interest earning liabilities from 5.34% to 4.89%.

Previous wording

For the three months ended June 30, 2026 and 2025 the provision for credit losses was $12.1 million and $9.1 million, respectively. The increase in provision for credit losses was primarily due to increases in net charge-offs, specific reserves on individually evaluated loans, and balances of loans held for investment at amortized cost, across all products but specifically SBA 7(a) loans.

Current wording

For the three months ended September 30, 2026 and 2025 the provision for credit losses was $15.4 million and $7.7 million, respectively. The increase in provision for credit losses was primarily due to increases in net charge-offs, specific reserves on individually evaluated loans, and balances of loans HFI at amortized cost, across all products but specifically SBA 7(a) loans.

Previous wording

The $3.8 million million increase in noninterest income when comparing the three months ended June 30, 2026 to three months ended June 30, 2025 was primarily due to an increase in net gain on loans under the fair value option of $32.4 million and an increase in other noninterest income of $8.1 million. The increase in net gain on loans under the fair value option was primarily due to the reversal of previous gains on ALP loans to consummate the 2025-1 transaction executed in Q2 2025 and the increase in other noninterest income was primarily due to an increase in realized gains on derivative transactions, income on recoveries and an increase in origination fees. These were partially offset by a decrease in net gain on residuals in securitizations of $29.5 million and a decrease in net gains on sales of loans of $4.3 million. The decrease in net gain on residuals in securitizations was primarily due to Company’s equity interest in the 2025-1 Securitization Trust, which closed in April 2025.

Current wording

The $7.5 million decrease in noninterest income when comparing the three months ended September 30, 2026 to three months ended September 30, 2025 was primarily due to a decrease in net gains on sales of loans of $9.5 million and a decrease in net gain on loans under the fair value option of $9.3 million, which were partially offset by an increase in other noninterest income of $6.3 million and a decrease in net loss on loan servicing assets of $3.2 million. The decrease in net gains on sales of loans was primarily due to holding more loans on our balance sheet, which generates recurring interest income growth.

Previous wording

The banking segment includes Newtek Bank as well as its consolidated subsidiary SBL. The financial results include the origination, sale, and servicing of SBA 7(a) loans, SBA 504 loans, C&I loans, C&I LA loans, CRE loans and ABL loans. In addition, Newtek Bank offers depository services. The results include $22.9 million of net interest income during the three months ended June 30, 2026 compared to $14.6 million of net interest income during the three months ended June 30, 2025.

Current wording

The banking segment includes Newtek Bank as well as its consolidated subsidiaries SBL and PMT. The financial results include the origination, sale, and servicing of SBA 7(a) loans, SBA 504 loans, C&I loans, C&I LA loans, CRE loans and ABL loans. In addition, Newtek Bank offers depository services. The results include $26.3 million of net interest income during the three months ended September 30, 2026 compared to $16.6 million of net interest income during the three months ended September 30, 2025.

Previous wording

Alternative Lending includes NALH (Newtek ALP Holdings) and its subsidiaries. Within the segment’s results are $2.3 million of noninterest income for the three months ended June 30, 2026, compared to $13.1 million during the three months ended June 30, 2025. The net income also included $1.3 million and $2.5 million of noninterest expense for the three months ended June 30, 2026 and 2025, respectively. The reduction in income for the three months ended June 30, 2026 as compared to the three months ended June 30, 2025 resulted from loan originations no longer being originated by NALH subsequent to December 31, 2025.

Current wording

Alternative Lending includes NALH (Newtek ALP Holdings) and its subsidiaries. Within the segment’s results are $0.4 million of noninterest income for the three months ended September 30, 2026, compared to $22.1 million during the three months ended September 30, 2025. The net income also included $1.2 million and $3.2 million of noninterest expense for the three months ended September 30, 2026 and 2025, respectively. The reduction in income for the three months ended September 30, 2026 as compared to the three months ended September 30, 2025 resulted from loan originations no longer being originated by NALH subsequent to December 31, 2025.

Previous wording

Payments includes NMS, POS and Mobil Money. Within the segment’s results are $11.4 million of noninterest income for the three months ended June 30, 2026, resulting from marketing credit and debit card processing services, check approval services, processing equipment, and software, compared to $12.6 million during the three months ended June 30, 2025. The net income also included $7.6 million and $8.4 million of noninterest expense for the three months ended June 30, 2026 and 2025, respectively.

Current wording

Payments includes NMS, POS and Mobil Money. Within the segment’s results are $10.8 million of noninterest income for the three months ended September 30, 2026, resulting from marketing credit and debit card processing services, check approval services, processing equipment, and software, compared to $11.9 million during the three months ended September 30, 2025. The net income also included $7.0 million and $7.6 million of noninterest expense for the three months ended September 30, 2026 and 2025, respectively.

Previous wording

Corporate and Other represents operations not considered to be reportable segments and/or general operating expenses of the Company, and includes the parent company, other non-bank subsidiaries including NIA, PMT, and elimination adjustments to reconcile the results of the operating segments to the consolidated financial statements prepared in conformity with GAAP.

Current wording

Corporate and Other represents operations not considered to be reportable segments and/or general operating expenses of the Company, and includes the parent company, other non-bank subsidiaries including NIA, and elimination adjustments to reconcile the results of the operating segments to the consolidated financial statements prepared in conformity with GAAP.

Previous wording

Total assets at June 30, 2026 were $3.2 billion, an increase of $440.1 million, or 16.0%, compared to total assets of $2.7 billion at December 31, 2025.

Current wording

Total assets at September 30, 2026 were $3.5 billion, an increase of $781.2 million, or 28.5%, compared to total assets of $2.7 billion at December 31, 2025.

Previous wording

Loans HFS, at fair value decreased $471.1 million during the six months ended June 30, 2026. The decrease was primarily attributable to the reclassification of $442.6 million of loans from loans held for sale, at fair value, to loans held for investment, at fair value, as a result of certain modifications made with respect to Newtek Bank’s participation in the SBA Secondary Market.

Current wording

Loans HFS, at fair value decreased $317.6 million during the nine months ended September 30, 2026. The decrease was primarily attributable to the reclassification of $442.6 million of loans from loans HFS, at fair value, to loans HFI, at fair value, in the second quarter of 2026 as a result of certain modifications made with respect to Newtek Bank’s participation in the SBA Secondary Market.

Previous wording

1 As a result of an agreement with the SBA with respect to Newtek Bank’s participation in the SBA Secondary Market, $442.6 million of loans held for sale, at fair value, as of June 30, 2026, were reclassified to loans held for investment, at fair value.

Current wording

1 As a result of an agreement with the SBA with respect to Newtek Bank’s participation in the SBA Secondary Market, $442.6 million of loans HFS, at fair value, as of June 30, 2026, were reclassified to loans HFI, at fair value.

Previous wording

Loans HFS, at LCM decreased $6.1 million during the same period.

Current wording

Loans HFS, at LCM decreased $8.3 million during the same period.

Previous wording

At Fair value: Loans HFI, at fair value were $721.6 million at June 30, 2026 compared to $281.2 million at December 31, 2025. The increase was primarily driven by the reclassification of $442.6 million of loans from loans held for sale, at fair value, to loans held for investment, at fair value, as a result an agreement with the SBA with respect to Newtek Bank’s participation in the SBA Secondary Market. This increase was partially offset principal payments on existing loans held by NSBF, which ceased originating loans in 2023, as previously discussed.

Current wording

At Fair value: Loans HFI, at fair value were $823.7 million at September 30, 2026 compared to $281.2 million at December 31, 2025. The increase was primarily driven by the reclassification of $442.6 million of loans from loans HFS, at fair value, to loans HFI, at fair value, as a result an agreement with the SBA with respect to Newtek Bank’s participation in the SBA Secondary Market.

Previous wording

At Amortized Cost: Loans HFI, at amortized cost, consist of loans originated at or purchased by Newtek Bank. The $242.8 million increase in loans HFI, at amortized cost, is the result of an increase in originations for the six months ended June 30, 2026 over 2025.

Current wording

At Amortized Cost: Loans HFI, at amortized cost, consist of loans originated at or purchased by Newtek Bank. The $412.6 million increase in loans HFI, at amortized cost, is the result of an increase in originations for the nine months ended September 30, 2026 over 2025.

Previous wording

Credit Quality: The increase in nonperforming loans HFI is adequately covered by the allowance for credit losses and in line with the seasoning of the portfolio. Additionally, the increase in nonperforming loans was driven by the repurchase of guaranteed portions of SBA 7(a) loans from the secondary market and the SBA. The Company continues to focus on prudent underwriting and portfolio diversification across its lending activities. The following table presents an analysis of loans HFI with credit metrics, including a breakdown by days aged:

Current wording

Credit Quality: The increase in nonperforming loans was primarily driven by the repurchases of $184.1 million of guaranteed portions of SBA 7(a) loans from the secondary market and the SBA since 2025. In accordance with ASC 326, the zero loss exception is applied and no allowance for credit losses has been recorded on the guaranteed portions given these portions of loans are guaranteed by a government-sponsored entity, the SBA guarantees are in full force and the Company expects to collect the guaranteed amounts in full from the SBA in the event of borrower defaults While the allowance coverage ratio to total loans HFI has declined, when considering the zero loss exception previously described, the allowance coverage ratio has remained consistent during 2026. In addition, the increase in nonperforming loans has been driven by current economic conditions, including rising interest rates and inflation. The Company continues to focus on prudent underwriting and portfolio diversification across its lending activities. The following table presents an analysis of loans HFI with credit metrics, including a breakdown by days aged:

Previous wording

The Company’s loan portfolio consists of loans to independent business owners (SMBs). The Company’s Loans HFI at amortized cost and Loans HFS at LCM include a total of $414.4 million of loans, including unfunded commitments, backed by CRE and considered non-owner occupied as of June 30, 2026. The average loan-to-value for this CRE portfolio was 58.7%. The CRE portfolio is diversified by property type and geography, and management actively monitors concentration levels, loan to value ratios, and debt service coverage metrics as part of its ongoing credit risk management process. Furthermore, there is limited exposure to office space.

Current wording

The Company’s loan portfolio consists of loans to independent business owners (SMBs). The Company’s Loans HFI at amortized cost and Loans HFS at LCM include a total of $432.4 million of loans, including unfunded commitments, backed by CRE and considered non-owner occupied as of September 30, 2026. The average loan-to-value for this CRE portfolio was 59.9%. The CRE portfolio is diversified by property type and geography, and management actively monitors concentration levels, loan to value ratios, and debt service coverage metrics as part of its ongoing credit risk management process. Furthermore, there is limited exposure to office space.