SoFi Technologies Inc
For the period ended Jun 30, 2024. Filed Aug 6, 2024.
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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, 2024 · Filed Aug 6, 2024
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Noninterest Income and Net Revenue
The following table presents the components of our total noninterest income, as well as total net revenue:
| Three Months EndedJune 30, · 2024 vs 2023 · Six Months EndedJune 30, · 2024 vs 2023 | ||||||||
|---|---|---|---|---|---|---|---|---|
| ($ in thousands) | 2024 | 2023 | $ Change | % Change | 2024 | 2023 | $ Change | % Change |
| Loan origination, sales, and securitizations | $54,872 | $90,164 | $(35,292) | (39)% | $111,872 | $213,498 | $(101,626) | (48)% |
| Servicing | 6,659 | 9,052 | (2,393) | (26)% | 13,633 | 21,794 | (8,161) | (37)% |
| Technology products and solutions | 85,866 | 82,289 | 3,577 | 4% | 171,538 | 155,090 | 16,448 | 11% |
| Other | 38,637 | 25,387 | 13,250 | 52% | 131,268 | 52,658 | 78,610 | 149% |
| Total noninterest income | $186,034 | $206,892 | $(20,858) | (10)% | $428,311 | $443,040 | $(14,729) | (3)% |
| Total net revenue | $598,618 | $498,018 | $100,600 | 20% | $1,243,613 | $970,176 | $273,437 | 28% |
Three Months. Total noninterest income decreased by $20.9 million, or 10%, for the three months ended June 30, 2024 compared to the three months ended June 30, 2023. The decrease was primarily attributable to: (i) higher loan write-offs in the 2024 period, primarily driven by longer loan holding periods and elevated charge off rates, and (ii) the net effect of lower gains in the 2024 period on student and personal loan interest rate swap positions due to smaller increases in interest rates during the 2024 period, lower fair value gains on personal loans in the 2024 period, which were primarily impacted by lower discount rate assumptions and higher prepayment rate assumptions, and fair value gains on student loans in the 2024 period compared to losses during the 2023 period, which were primarily impacted by higher student loan origination volume.
These decreases were partially offset by: (i) higher origination fees primarily related to a product feature offered on personal loans, whereby a borrower may optionally elect to pay origination fees to qualify for a lower annual percentage rate, and (ii) an increase in interchange and referrals revenue.
Six Months. Total noninterest income decreased by $14.7 million, or 3%, for the six months ended June 30, 2024 compared to the six months ended June 30, 2023. The decrease was primarily attributable to: (i) higher loan write-offs in the 2024 period, primarily driven by longer loan holding periods and elevated charge off rates, and (ii) the net effect of fair value losses on personal loans in the 2024 period compared to gains during the 2023 period, which were primarily impacted by higher prepayment and default rate assumptions as well as higher unpaid principal balance, lower fair value gains on student loans in the 2024 period, which were primarily impacted by higher prepayment rate assumptions and higher unpaid principal balance, and higher gains in the 2024 period on student loan, personal loan and risk retention interest rate swap positions primarily driven by larger increases in interest rates during the 2024 period and increased derivative instruments outstanding,
These decreases were partially offset by: (i) higher origination fees primarily related to a product feature offered on personal loans, whereby a borrower may optionally elect to pay origination fees to qualify for a lower annual percentage rate, (ii) gain on extinguishment of debt of $59.2 million during the 2024 period, (iii) growth in technology services fees driven by increased processing and service arrangement activity among our integrated technology solutions clients as well as account growth, and (iv) an increase in interchange and referrals revenue.
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