Finwise Bancorp

Previous wording

There have been no material changes during the six months ended June 30, 2026 to the methods we used and judgments we made relating to critical accounting estimates from those disclosed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the 2025 Form 10-K.

Current wording

There have been no material changes during the nine months ended September 30, 2026 to the methods we used and judgments we made relating to critical accounting estimates from those disclosed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the 2025 Form 10-K.

Previous wording

Our lending focuses on two main lending areas: (1) traditional lending which includes SBA 7(a) loans, residential and commercial real estate, and commercial leasing; and (2) Strategic Programs lending which includes held-for-sale, credit enhanced, and retained loans. For a description and analysis of the Company’s loan categories, see “Financial Condition.”

Current wording

Our lending focuses on two main lending areas: (1) traditional lending which includes SBA 7(a) loans, residential and commercial real estate, and commercial leasing; and (2) Strategic Programs lending which includes held-for-sale, credit enhanced, and retained loans. For a description and analysis of our loan categories, see “Financial Condition.”

Previous wording

•For the three months ended June 30, 2026, originations increased to $1.6 billion from $1.5 billion when compared to the three months ended June 30, 2025. For the six months ended June 30, 2026, originations increased to $3.4 billion from $2.7 billion when compared to the six months ended June 30, 2025. New strategic programs and organic growth through certain established strategic programs contributed to the increase in loan originations.

Current wording

•For the three months ended September 30, 2026, originations increased to $2.1 billion from $1.8 billion when compared to the three months ended September 30, 2025. For the nine months ended September 30, 2026, originations increased to $5.4 billion from $4.5 billion when compared to the nine months ended September 30, 2025. The growth in originations in 2026 compared to 2025 primarily reflects the rapid growth of a credit enhancement lending relationship, and an increase in volume from certain established strategic programs.

Previous wording

•Net interest margin (“NIM”) was 13.69% for the three months ended June 30, 2026, compared to 7.81% for the three months ended June 30, 2025. NIM was 13.29% for the six months ended June 30, 2026, compared to 8.03% for the six months ended June 30, 2025. NIM is impacted by income earned from interest-earning assets and interest costs incurred on interest-bearing liabilities and increased significantly for the three and six months ended June 30, 2026 compared to the same periods in 2025 due to the growth of the credit enhanced loan program.

Current wording

•Net interest margin (“NIM”) was 19.58% for the three months ended September 30, 2026, compared to 9.09% for the three months ended September 30, 2025. NIM was 15.50% for the nine months ended September 30, 2026, compared to 8.44% for the nine months ended September 30, 2025. NIM is impacted by income earned from interest-earning assets and interest costs incurred on interest-bearing liabilities and increased significantly for the three and nine months ended September 30, 2026 compared to the same periods in 2025 due to the growth of the credit enhanced loan program.

Previous wording

Net interest income increased for the three months ended June 30, 2026, compared to the same period in 2025, primarily due to the increase in the credit enhanced loans and a change in estimate, based on additional information and experience, on the allocation of interest received on credit enhanced loans in excess of the amount we retain. We now estimate that all excess interest is attributable to servicing and credit guarantee expense, whereas in the prior year it had been estimated that a portion was attributable to origination costs, or finders' fees, and was reported in net interest income.

Current wording

Net interest income increased for the three months ended September 30, 2026, compared to the same period in 2025, primarily due to growth in credit enhanced loans, as well as a change in estimate, based on additional information and experience, regarding the allocation of interest received on credit enhanced loans in excess of the amount we retain. We now estimate that all excess interest is attributable to servicing and credit guarantee expense. In the prior year, it had estimated that a portion was attributable to origination costs, or finders’ fees, which was reported in net interest income.

Previous wording

Net interest income increased for the six months ended June 30, 2026, compared to the same period in 2025, primarily due to an increase in average interest-earning assets of $133.8 million, partially offset by lower yields on interest-earning assets, and an increase in the average interest-bearing liabilities of $94.2 million mainly attributable to the increase in brokered deposits used to fund our loan growth.

Current wording

Net interest income increased for the nine months ended September 30, 2026, compared to the same period in 2025, primarily due to growth in credit-enhanced loans which drove the increase in average interest-earning assets of $102.9 million, higher yields on interest-earning assets, partially offset by an increase in the average interest-bearing liabilities of $67.3 million mainly attributable to the increase in brokered deposits used to fund our loan growth.

Previous wording

NIM increased to 13.69% for the three months ended June 30, 2026 from 7.81% for the three months ended June 30, 2025 and increased to 13.29% for the six months ended June 30, 2026 from 8.03% for the six months ended June 30, 2025, primarily from the growth in the higher yielding credit-enhanced portfolio average balance and higher yields on loans held for investment, the change in estimated allocation of excess interest as previously described, and slightly lower rates paid on deposits.

Current wording

NIM increased to 19.58% for the three months ended September 30, 2026 from 9.09% for the three months ended September 30, 2025 and increased to 15.50% for the nine months ended September 30, 2026 from 8.44% for the nine months ended September 30, 2025, primarily from growth in the higher-yielding credit-enhanced loan portfolio and higher yields on loans held-for-investment, the change in estimated allocation of excess interest as previously described, and lower rates paid on deposits.

Previous wording

The increase in total non-interest income for the six months ended June 30, 2026, compared to the six months ended June 30, 2025 was primarily due to increases in credit enhanced loan balances which resulted in growth in the provision for credit losses which in turn resulted in higher credit enhancement income as a reciprocal to the provision for credit losses on credit enhanced loans. Additionally, the increased sales of the guaranteed portions of SBA 7(a) loans led to an increase in gains on loan sales of $0.6 million, an increase in loan origination volume led to higher Strategic Program fees of $0.6 million, and the acquisition of a credit card portfolio in November 2025 introduced interchange income to FinWise.

Current wording

The increases in total non-interest income for the three and nine months ended September 30, 2026, compared to the same periods in 2025, were primarily due to an increase in credit enhancement income, driven by growth in credit-enhanced loan balances, and the $6.5 million bargain purchase gain recognized in connection with the Tallied acquisition. These increases were partially offset by a decrease in the fair value of our investment in BFG. Additionally, during the nine months ended September 30, 2026, the increased sales of the guaranteed portions of SBA 7(a) loans led to an increase in gains on loan sales of $0.6 million and an increase in loan origination volume led to higher Strategic Program fees of $0.9 million.

Previous wording

The increase in total non-interest expense for the three and six months ended June 30, 2026, compared to the same period in 2025, was primarily due to an increase in credit enhancement servicing and guarantee expenses resulting from growth in credit enhanced loans and salaries and employee benefits mainly from increased headcount.

Current wording

The increase in total non-interest expense for the three and nine months ended September 30, 2026, compared to the same period in 2025, was primarily due to an increase in credit enhancement guarantee and servicing expenses resulting from growth in credit-enhanced loans, and higher salaries and employee benefits, principally from increased headcount, including employees added in connection with the Tallied acquisition.

Previous wording

Our provision for income taxes for the three and six months ended June 30, 2026 and 2025 resulted in an effective income tax rate of 24.0%, 24.5%, 26.3% and 26.1% respectively. The effective tax rate differed from the federal statutory rate of 21.0% for the three and six months ended June 30, 2026 principally due tostate and local income taxes and certain non-deductible executive compensation.

Current wording

Our provision for income taxes for the three and nine months ended September 30, 2026 and 2025 resulted in an effective income tax rate of 21.0%, 23.7%, 22.8% and 25.2% respectively. The effective tax rate differed from the federal statutory rate of 21.0% for the three and nine months ended September 30, 2026 principally due to state and local income taxes and certain non-deductible executive compensation, offset in part by the effect of presenting the bargain purchase gain net of deferred taxes.

Previous wording

The changes in net income for the three and six months ended June 30, 2026, compared to the same periods in 2025, were primarily the result of the factors discussed in the foregoing sections.

Current wording

Net income was $10.0 million and $4.9 million for the three months ended September 30, 2026 and 2025, respectively, and $14.9 million and $12.2 million for the nine months ended September 30, 2026 and 2025, respectively. Net income from continuing operations was $10.4 million and $4.9 million for the three months ended September 30, 2026 and 2025, respectively and $14.3 million and $12.2 million for the nine months ended September 30, 2026 and 2025, respectively. The three and nine months ended September 30, 2026 included a non-recurring, bargain purchase gain net of deferred taxes of $6.5 million recognized in connection with the Tallied acquisition; this gain was exempt from income tax as the related deferred taxes were recorded in acquisition accounting. Discontinued operations resulted in a loss, net of tax, of $0.4 million and income, net of tax of $0.6 million for the three and nine months ended September 30, 2026, respectively. The remaining changes in net income for the three and nine months ended September 30, 2026, compared to the same periods in 2025, were primarily the result of the factors discussed in the foregoing sections.

Previous wording

As further described in Note 14, Segments, in Part I, Item 1 of this Report, during the third quarter of 2025, we implemented segment reporting following the completion of a technology initiative to capture segment-specific financial data and develop reports used by our chief operating decision maker (“CODM”) to review our financial performance and determine how to allocate resources. Our operations are comprised of three reportable segments: traditional banking, banking as a service and treasury and administration.

Current wording

As further described in Note 16, Segments, in Part I, Item 1 of this Report, our operations are comprised of three reportable segments: traditional banking, banking as a service and treasury and administration.

Previous wording

For periods prior to July 1, 2025, our operations were managed and reported as a single segment, and historical financial data by segment was not maintained. Accordingly, it is not practicable to present segment information for prior periods. In the segment reporting below, a non-GAAP subtotal is shown, captioned “Income (loss) before other operating expense allocation”. That subtotal presents an income (loss) subtotal before consideration of allocated corporate expenses which might be fixed, semi-fixed or otherwise resist changes without regard to a particular line of business. The following tables provide segment information for the periods indicated (in thousands):

Current wording

In the tables below, a non-GAAP subtotal is shown, captioned “Income (loss) before other operating expense allocation”. That subtotal presents an income (loss) subtotal before consideration of allocated corporate expenses which might be fixed, semi-fixed or otherwise resist changes without regard to a particular line of business. The following tables provide segment information for the periods indicated (in thousands):

Previous wording

The decrease in interest-bearing deposits in other banks from December 31, 2025 to June 30, 2026, was primarily due to funding our Strategic Program loans held-for-sale portfolio. Aside from minimal balances held with our correspondent banks, the majority of our interest-bearing deposits are held at the Federal Reserve.

Current wording

The decrease in interest-bearing deposits in other banks from December 31, 2025 to September 30, 2026, was primarily due to excess cash carried at year end 2025 and lower funding requirements for the Strategic Program loans held-for-investment portfolio. Aside from minimal balances held with our correspondent banks, the majority of our interest-bearing deposits are held at the Federal Reserve.

Previous wording

There were no sales or transfers of investment securities between classifications during the six months ended June 30, 2026 and 2025.

Current wording

There were no sales or transfers of investment securities between classifications during the nine months ended September 30, 2026 and 2025.

Previous wording

At June 30, 2026, we had a total of eighteen securities in an unrealized loss position, consisting of eight collateralized mortgage obligations and ten mortgage-backed securities. At December 31, 2025, we had a total of seventeen securities in an unrealized loss position, consisting of eight collateralized mortgage obligations and nine mortgage-backed securities.

Current wording

At September 30, 2026, we had a total of twenty securities in an unrealized loss position, consisting of nine collateralized mortgage obligations,ten mortgage-backed securities and one U.S. Treasury security. At December 31, 2025, we had a total of seventeen securities in an unrealized loss position, consisting of eight collateralized mortgage obligations and nine mortgage-backed securities.

Previous wording

Our Strategic Program loans held-for-sale increased $28.7 million as of June 30, 2026 compared to December 31, 2025, primarily as a result of higher originations for certain programs.

Current wording

Our Strategic Program loans held-for-sale decreased $11.8 million as of September 30, 2026 compared to December 31, 2025, primarily as a result of lower originations for certain programs.

Previous wording

The following table summarizes our gross loan portfolio held-for-investment by loan program as of the dates indicated:

Current wording

The following table summarizes our loan portfolio held-for-investment by loan program as of the dates indicated:

Previous wording

(1)SBA loans as of June 30, 2026 and December 31, 2025 include $66.1 million and $102.7 million, respectively, of SBA 7(a) loan balances that are guaranteed by the SBA.

Current wording

(1)SBA loans as of September 30, 2026 and December 31, 2025 include $44.0 million and $102.5 million, respectively, of SBA 7(a) loan balances that are guaranteed by the SBA.

Previous wording

As of June 30, 2026 and December 31, 2025, we had total SBA 7(a) loans of $164.0 million and $205.6 million, respectively, representing 28.7% and 35.1% of our total loans held-for-investment, respectively. Loans are sourced primarily through our referral relationship with BFG. Although BFG actively markets throughout the United States, we have developed a lending presence in the New York and New Jersey geographies due to its physical location in New York. The maximum SBA 7(a) loan amount is $5.0 million. Underwriting is generally based on commercial credit metrics where the primary repayment source is borrower cash flow, secondary is personal guarantor cash flow and tertiary is the sale of collateral pledged. These loans may be secured by commercial and residential mortgages as well as liens on business assets. In addition to typical underwriting metrics, we review the nature of the business, use of proceeds, length of time in business and management experience to help us target loans that we believe have lower credit risk. The SBA 7(a) program generally provides 50%, 75%, 85% and 90% guarantees for eligible SBA 7(a) loans. The guaranty is conditional and covers a portion of the risk of payment default by the borrower, but not the risk of improper underwriting, closing or servicing by the lender. As such, prudent underwriting, closing and servicing processes are essential to effective utilization of the SBA 7(a) program. We will sell interests in the SBA-guaranteed portion (typically 75% of the principal balance) of a majority of the loans we originate at a premium in the secondary market while retaining all servicing rights and the unguaranteed portion when market pricing for SBA loans are favorable. We will retain both the guaranteed portion and unguaranteed portion on our balance sheet when market pricing for SBA loans is less favorable and to season the new SBA loans to obtain optimal pricing. During the six months ended June 30, 2026, the Company sold $50.9 million of the guaranteed principal balances of SBA loans.

Current wording

As of September 30, 2026 and December 31, 2025, we had total SBA 7(a) loans of $135.8 million and $205.3 million, respectively, representing 23.2% and 38.7% of our total loans held-for-investment, respectively. Loans are sourced primarily through our referral relationship with BFG. Although BFG actively markets throughout the United States, we have developed a lending presence in the New York and New Jersey geographies due to its physical location in New York. The maximum SBA 7(a) loan amount is $5.0 million. Underwriting is generally based on commercial credit metrics where the primary repayment source is borrower cash flow, secondary is personal guarantor cash flow and tertiary is the sale of collateral pledged. These loans may be secured by commercial and residential mortgages as well as liens on business assets. In addition to typical underwriting metrics, we review the nature of the business, use of proceeds, length of time in business and management experience to help us target loans that we believe have lower credit risk. The SBA 7(a) program generally provides 50%, 75%, 85% and 90% guarantees for eligible SBA 7(a) loans. The guaranty is conditional and covers a portion of the risk of payment default by the borrower, but not the risk of improper underwriting, closing or servicing by the lender. As such, prudent underwriting, closing and servicing processes are essential to effective utilization of the SBA 7(a) program. We will sell interests in the SBA-guaranteed portion (typically 75% of the principal balance) of a majority of the loans we originate at a premium in the secondary market while retaining all servicing rights and the unguaranteed portion when market pricing for SBA loans are favorable. We will retain both the guaranteed portion and unguaranteed portion on our balance sheet when market pricing for SBA loans is less favorable and to season the new SBA loans to obtain optimal pricing. During the nine months ended September 30, 2026, we sold $78.5 million of the guaranteed principal balances of SBA loans.

Previous wording

As of June 30, 2026 and December 31, 2025, we had total commercial leases of $83.1 million and $78.7 million, respectively, representing 14.5% and 13.4% of our total loans held-for-investment, respectively. Underwriting for smaller credit requests from customers is generally based on an internal credit scorecard, incorporating several customer and structure attributes including: severity and aging of delinquency; number of credit inquiries; loan-to-value ratio; term; and payment-to-income ratio. We periodically update our underwriting scorecard, which can have an impact on our credit tier scoring. Underwriting for larger credit requests from customers is generally based on commercial credit metrics where the primary repayment source considered is borrower cash flow, secondary is personal guarantor cash flow (when applicable) and tertiary is the sale of collateral pledged. The nature of the business, use of proceeds, length of time in business, management experience, repayment ability, credit history, ratio calculations and assessment of collateral adequacy are also underwriting considerations. These leases are generally secured by liens on business assets leased or purchased with Company funds. Historically, we have retained these leases on our balance sheet for investment; however, we may sell leases to certain purchasers from time to time.

Current wording

As of September 30, 2026 and December 31, 2025, we had total commercial leases of $79.1 million and $68.8 million, respectively, representing 13.5% and 13.0% of our total loans held-for-investment, respectively. Underwriting for smaller credit requests from customers is generally based on an internal credit scorecard, incorporating several customer and structure attributes including: severity and aging of delinquency; number of credit inquiries; loan-to-value ratio; term; and payment-to-income ratio. We periodically update our underwriting scorecard, which can have an impact on our credit tier scoring. Underwriting for larger credit requests from customers is generally based on commercial credit metrics where the primary repayment source considered is borrower cash flow, secondary is personal guarantor cash flow (when applicable) and tertiary is the sale of collateral pledged. The nature of the business, use of proceeds, length of time in business, management experience, repayment ability, credit history, ratio calculations and assessment of collateral adequacy are also underwriting considerations. These leases are generally secured by liens on business assets leased or purchased with Company funds. Historically, we have retained these leases on our balance sheet for investment; however, we may sell leases to certain purchasers from time to time.

Previous wording

Commercial non-real estate loans consist of loans and leases made to commercial enterprises that are not secured by real estate. As of June 30, 2026 and December 31, 2025, we had total commercial non-real estate loans of $3.5 million and $4.2 million, respectively, representing 0.6% and 0.7% of our total loans held-for-investment, respectively. Any loan, lease, line of credit, or letter of credit (including any unfunded commitments) and any interest obtained in such loans made by another lender to individuals, sole proprietorships, partnerships, corporations, or other business enterprises for commercial, industrial, agricultural, or professional purposes, not secured by real estate, but not for personal expenditure purposes are included in this category. For example, commercial vehicle term loans and commercial working capital term loans are included in this product loan category. Underwriting is generally based on commercial credit metrics where the primary repayment source is borrower cash flow, secondary is personal guarantor cash flow (when applicable) and tertiary is the sale of collateral pledged. The nature of the business, use of proceeds, length of time in business, management experience, repayment ability, credit history, ratio calculations and assessment of collateral adequacy are all considerations. These loans are generally secured by liens on business assets. Historically, we have retained these loans on our balance sheet for investment.

Current wording

Commercial non-real estate loans consist of loans and leases made to commercial enterprises that are not secured by real estate. As of September 30, 2026 and December 31, 2025, we had total commercial non-real estate loans of $3.2 million and $4.3 million, respectively, representing 0.5% and 0.8% of our total loans held-for-investment, respectively. Any loan, lease, line of credit, or letter of credit (including any unfunded commitments) and any interest obtained in such loans made by another lender to individuals, sole proprietorships, partnerships, corporations, or other business enterprises for commercial, industrial, agricultural, or professional purposes, not secured by real estate, but not for personal expenditure purposes are included in this category. For example, commercial vehicle term loans and commercial working capital term loans are included in this product loan category. Underwriting is generally based on commercial credit metrics where the primary repayment source is borrower cash flow, secondary is personal guarantor cash flow (when applicable) and tertiary is the sale of collateral pledged. The nature of the business, use of proceeds, length of time in business, management experience, repayment ability, credit history, ratio calculations and assessment of collateral adequacy are all considerations. These loans are generally secured by liens on business assets. Historically, we have retained these loans on our balance sheet for investment.

Previous wording

Residential real estate loans include construction, lot and land development loans that are for the purpose of acquisition and development of property to be improved through the construction of residential buildings, and loans secured by other residential real estate. As of June 30, 2026 and December 31, 2025, we had total residential real estate loans of $70.5 million and $59.6 million, respectively, representing 12.3% and 10.2% of our total loans held-for-investment, respectively. Construction loans are usually paid off through the conversion to permanent financing from third-party lending institutions. Lot loans may be paid off as the borrower converts to a construction loan. At the completion of the construction project, if the loan is converted to permanent financing by us or if scheduled loan amortization begins, it is then reclassified from construction to single-family dwelling. Underwriting of construction and development loans typically includes analysis of the general market conditions associated with the area and type of project being funded in addition to the borrower’s financial condition and ability to meet the required debt obligation. These loans are generally secured by mortgages for residential property located primarily in the Salt Lake City, Utah MSA, and we obtain guarantees from responsible parties. Historically, we have retained these loans on our balance sheet for investment.

Current wording

Residential real estate loans include construction, lot and land development loans that are for the purpose of acquisition and development of property to be improved through the construction of residential buildings, and loans secured by other residential real estate. As of September 30, 2026 and December 31, 2025, we had total residential real estate loans of $79.9 million and $60.5 million, respectively, representing 13.7% and 11.4% of our total loans held-for-investment, respectively. Construction loans are usually paid off through the conversion to permanent financing from third-party lending institutions. Lot loans may be paid off as the borrower converts to a construction loan. At the completion of the construction project, if the loan is converted to permanent financing by us or if scheduled loan amortization begins, it is then reclassified from construction to single-family dwelling. Underwriting of construction and development loans typically includes analysis of the general market conditions associated with the area and type of project being funded in addition to the borrower’s financial condition and ability to meet the required debt obligation. These loans are generally secured by mortgages for residential property located primarily in the Salt Lake City, Utah MSA, and we obtain guarantees from responsible parties. Historically, we have retained these loans on our balance sheet for investment.

Previous wording

Through our Strategic Program service providers, we issue unsecured and secured consumer and business loans to borrowers within certain approved credit profiles nationwide. Although we have generally sold most of these loans, we may choose to hold more of the funded loans and/or receivables based on a number of factors including the amount of our available capital. As of June 30, 2026 and December 31, 2025, we had total Strategic Program loans held-for-investment of $144.6 million and $129.7 million, respectively, representing 25.3% and 22.2% of our total loans held-for-investment, respectively. Loans originated through the Strategic Program are limited to predetermined Bank underwriting criteria, which has been approved by our board of directors. The primary form of repayment on these loans is from the borrower’s personal or business cash flow. Secured loans are secured by liens on consumer or business assets, as applicable. We reserve the right to sell any portion of funded loans and/or receivables directly to the Strategic Program service providers or other investors. We generally retain the legal right to service all these loans, but contract with the Strategic Program service provider or another approved sub-servicer to service these loans on our behalf.

Current wording

Through our Strategic Program service providers, we issue unsecured and secured consumer and business loans to borrowers within certain approved credit profiles nationwide. Although we have generally sold most of these loans, we may choose to hold more of the funded loans and/or receivables based on a number of factors including the amount of our available capital. As of September 30, 2026 and December 31, 2025, we had total Strategic Program loans held-for-investment of $183.1 million and $81.8 million, respectively, representing 31.3% and 15.4% of our total loans held-for-investment, respectively. Loans originated through the Strategic Program are limited to predetermined Bank underwriting criteria, which has been approved by our board of directors. The primary form of repayment on these loans is from the borrower’s personal or business cash flow. Secured loans are secured by liens on consumer or business assets, as applicable. We reserve the right to sell any portion of funded loans and/or receivables directly to the Strategic Program service providers or other investors. We generally retain the legal right to service all these loans, but contract with the Strategic Program service provider or another approved sub-servicer to service these loans on our behalf.

Previous wording

The Strategic Program loans with credit enhancement are distinct from our traditional loan portfolio. A specified percentage of the outstanding Strategic Program loan balances, representing interest and potentially other revenue sources associated with the program, is retained in a restricted deposit account, from which FinWise recovers its share of any charged-off principal and interest on the related loans. Interest and fees collected in excess of the amounts needed to maintain the deposit balance at the required level are paid to the fintech. In addition, the sponsoring fintech company guarantees that FinWise is reimbursed for the credit and fraud losses associated with these loans. Credit enhanced Strategic Program loans totaled $120.8 million and $108.1 million as of June 30, 2026 and December 31, 2025, representing 21.1% and 18.5% of our total loans held-for-investment, respectively. This significant increase reflects the expansion of the credit enhanced program and its impact on our balance sheet. The Reconciliations of Non-GAAP Financial Measures section of this report below further details the impact of the credit enhancement program on our allowance for credit losses and related non-GAAP financial measures.

Current wording

The Strategic Program loans with credit enhancement are distinct from our traditional loan portfolio. A specified percentage of the outstanding Strategic Program loan balances, representing interest and potentially other revenue sources associated with the program, is retained in a restricted deposit account, from which FinWise recovers its share of any charged-off principal and interest on the related loans. Interest and fees collected in excess of the amounts needed to maintain the deposit balance at the required level are paid to the fintech. In addition, the sponsoring fintech company guarantees that FinWise is reimbursed for the credit and fraud losses associated with these loans. Credit enhanced Strategic Program loans totaled $146.2 million and $59.9 million as of September 30, 2026 and December 31, 2025, representing 25.0% and 11.3% of our total loans held-for-investment, respectively. This significant increase reflects the expansion of the credit enhanced program and its impact on our balance sheet. The Reconciliations of Non-GAAP Financial Measures section of this report below further details the impact of the credit enhancement program on our allowance for credit losses and related non-GAAP financial measures.

Previous wording

Strategic Program loans without credit enhancement totaled $23.9 million and $21.6 million as of June 30, 2026 and December 31, 2025, representing 4.2% and 3.7% of our total loans held-for-investment, respectively. Unlike the credit enhanced loans, these non-credit enhanced loans do not benefit from a third-party guarantee or indemnification of credit and fraud losses by the Strategic Program service provider. As a result, the Bank retains the full interest and fee income as well as the credit and fraud losses associated with these loans, and they are subject to our standard credit risk management, monitoring, and allowance for credit losses under the CECL model. The accounting for non-credit enhanced Strategic Program loans is consistent with our other held-for-investment loan portfolios. While the non-credit enhanced Strategic Program loans represent a smaller portion of our overall loan portfolio, they provide additional diversification and support our broader fintech strategy.

Current wording

Strategic Program loans without credit enhancement totaled $36.9 million and $21.9 million as of September 30, 2026 and December 31, 2025, representing 6.3% and 4.1% of our total loans held-for-investment, respectively. Unlike the credit enhanced loans, these non-credit enhanced loans do not benefit from a third-party guarantee or indemnification of credit and fraud losses by the Strategic Program service provider. As a result, the Bank retains the full interest and fee income as well as the credit and fraud losses associated with these loans, and they are subject to our standard credit risk management, monitoring, and allowance for credit losses under the CECL model. The accounting for non-credit enhanced Strategic Program loans is consistent with our other held-for-investment loan portfolios. While the non-credit enhanced Strategic Program loans represent a smaller portion of our overall loan portfolio, they provide additional diversification and support our broader fintech strategy.

Previous wording

Commercial real estate loans include loans to individuals, sole proprietors, partnerships, corporations, or other business enterprises for commercial, industrial, agricultural, or professional purposes, secured by real estate, but not for personal expenditure purposes. As of June 30, 2026 and December 31, 2025, we had total commercial real estate loans of $88.7 million and $85.7 million, respectively, representing 15.5% and 14.6% of our total loans held-for-investment, respectively. Of these amounts, $86.6 million and $84.0 million represented owner occupied properties as of June 30, 2026 and December 31, 2025, respectively. Underwriting is generally based on commercial credit metrics where the primary repayment source is borrower cash flow, secondary is personal guarantor cash flow (when applicable) and tertiary is the sale of collateral pledged. The nature of the business, use of proceeds, length of time in business, management experience, repayment ability, credit history, ratio calculations and assessment of collateral adequacy are all considerations. In addition to real estate, these loans may also be secured by liens on business assets. Historically, we have retained these loans on our balance sheet for investment.

Current wording

Commercial real estate loans include loans to individuals, sole proprietors, partnerships, corporations, or other business enterprises for commercial, industrial, agricultural, or professional purposes, secured by real estate, but not for personal expenditure purposes. As of September 30, 2026 and December 31, 2025, we had total commercial real estate loans of $89.7 million and $87.0 million, respectively, representing 15.3% and 16.4% of our total loans held-for-investment, respectively. Of these amounts, $87.5 million and $85.3 million represented owner occupied properties as of September 30, 2026 and December 31, 2025, respectively. Underwriting is generally based on commercial credit metrics where the primary repayment source is borrower cash flow, secondary is personal guarantor cash flow (when applicable) and tertiary is the sale of collateral pledged. The nature of the business, use of proceeds, length of time in business, management experience, repayment ability, credit history, ratio calculations and assessment of collateral adequacy are all considerations. In addition to real estate, these loans may also be secured by liens on business assets. Historically, we have retained these loans on our balance sheet for investment.

Previous wording

Consumer lending provides financing for personal, family, or household purposes on a nationwide basis. Most of these loans are originated through our loan origination system platform and come from a variety of sources, including other approved merchant or dealer relationships and lending platforms. As of June 30, 2026 and December 31, 2025, we had total consumer loans of $17.0 million and $21.9 million, respectively, representing 3.0% and 3.8% of our total loans held-for-investment, respectively. We use a debt-to-income (“DTI”) ratio test to determine whether an applicant will be able to service the debt. The DTI ratio compares the applicant’s anticipated monthly expenses and total monthly obligations to the applicant’s monthly gross income. Our policy is to limit the DTI ratio to 45% after calculating interest payments related to the new loan. Loan officers, at their discretion, may make exceptions to this ratio if the loan is within their authorized lending limit. DTI ratios of no more than 50% may be approved subject to an increase in interest rate. Strong offsetting factors such as higher discretionary income or large down payments are used to justify exceptions to these guidelines. All exceptions are documented and reported. While the loans are generally for the purchase of goods which may afford us a purchase money security interest, these loans are underwritten as if they were unsecured. On larger loans, we may file a Uniform Commercial Code (“UCC”) financing form. Historically, we have retained these loans on our balance sheet for investment.

Current wording

Consumer lending provides financing for personal, family, or household purposes on a nationwide basis. Most of these loans are originated through our loan origination system platform and come from a variety of sources, including other approved merchant or dealer relationships and lending platforms. As of September 30, 2026 and December 31, 2025, we had total consumer loans of $14.3 million and $22.2 million, respectively, representing 2.5% and 4.3% of our total loans held-for-investment, respectively. We use a debt-to-income (“DTI”) ratio test to determine whether an applicant will be able to service the debt. The DTI ratio compares the applicant’s anticipated monthly expenses and total monthly obligations to the applicant’s monthly gross income. Our policy is to limit the DTI ratio to 45% after calculating interest payments related to the new loan. Loan officers, at their discretion, may make exceptions to this ratio if the loan is within their authorized lending limit. DTI ratios of no more than 50% may be approved subject to an increase in interest rate. Strong offsetting factors such as higher discretionary income or large down payments are used to justify exceptions to these guidelines. All exceptions are documented and reported. While the loans are generally for the purchase of goods which may afford us a purchase money security interest, these loans are underwritten as if they were unsecured. On larger loans, we may file a Uniform Commercial Code financing form. Historically, we have retained these loans on our balance sheet for investment.

Previous wording

We had a total of $37.7 million in nonperforming assets as of June 30, 2026, which included $19.0 million of SBA 7(a) loan balances that are guaranteed by the SBA. We had $43.7 million in nonperforming assets which included $0.5 million in material loan modifications at December 31, 2025. The amount of nonperforming assets as of December 31, 2025 includes $24.2 million of SBA 7(a) loan balances that are guaranteed by the SBA. The decrease in nonperforming assets from the prior year was primarily attributable to a decrease in the SBA 7(a) loan portfolio being classified as nonaccrual mainly due to paydowns.

Current wording

We had a total of $37.1 million in nonperforming assets as of September 30, 2026, which included $17.7 million of SBA 7(a) loan balances that are guaranteed by the SBA. We had $43.9 million in nonperforming assets which included $0.5 million in material loan modifications at December 31, 2025. The amount of nonperforming assets as of December 31, 2025 includes $24.4 million of SBA 7(a) loan balances that are guaranteed by the SBA. The decrease in nonperforming assets from the prior year was primarily attributable to a decrease in the SBA 7(a) loan portfolio being classified as nonaccrual mainly due to paydowns.

Previous wording

Our Strategic Program service providers also provide for loan modifications to borrowers. The service providers are authorized to make the loan modifications consistent with modification program terms previously approved by FinWise but without prior FinWise consent on the specific loans in order to react to immediately to borrower contact and optimize collections. As of June 30, 2026 the balance of outstanding loan modifications was approximately $0.2 million.

Current wording

Our Strategic Program service providers also provide for loan modifications to borrowers. The service providers are authorized to make the loan modifications consistent with modification program terms previously approved by FinWise but without prior FinWise consent on the specific loans in order to react to immediately to borrower contact and optimize collections. As of September 30, 2026 the balance of outstanding loan modifications was approximately $0.3 million.

Previous wording

(1) Recoveries related to Strategic Program loans that were reimbursed fully on the credit enhanced portfolio totaled $7.8 million and $1.0 thousand for the three months ended June 30, 2026 and June 30, 2025, respectively, and $12.7 million and $2.0 thousand for the six months ended June 30, 2026 and June 30, 2026, respectively.

Current wording

(1) Recoveries related to Strategic Program loans that were reimbursed fully on the credit enhanced portfolio totaled $9.5 million and $1.0 thousand for the three months ended September 30, 2026 and September 30, 2025, respectively, and $20.5 million and $2.0 thousand for the nine months ended September 30, 2026 and September 30, 2025, respectively.

Previous wording

The following table shows the allocation of the ACL and the percentage of loans in each category to total loans as of June 30, 2026 and December 31, 2025. The ACL related to Strategic Programs constitutes 78.9% and 77.0% of the total ACL while comprising 25.3% and 22.2%, respectively, of total loans held-for-investment as of June 30, 2026 and December 31, 2025, respectively. The percentage of ACL related to Strategic Program loans retained reflects the increased credit risks associated with certain retained Strategic Program loans.

Current wording

The following table shows the allocation of the ACL and the percentage of loans in each category to total loans as of September 30, 2026 and December 31, 2025. The ACL related to Strategic Programs constitutes 88.2% and 74.2% of the total ACL while comprising 31.3% and 15.4%, respectively, of total loans held-for-investment as of September 30, 2026 and December 31, 2025, respectively. The percentage of ACL related to Strategic Program loans retained reflects the increased credit risks associated with certain retained Strategic Program loans.

Previous wording

When comparing June 30, 2026 to December 31, 2025, the increase in ACL to total loans held-for-investment was primarily due to the increase of the credit enhanced loan portfolio ACL resulting from the change in portfolio composition. The decrease in nonaccrual loans to total loans held-for-investment as shown above was primarily driven by a decline in nonaccrual loan balances, which more than offset the decrease in total loans held-for-investment during the period. The increase in the ACL to nonaccrual loans ratio as shown above primarily pertained to growth in the credit enhanced loans included in the Strategic Program loans held-for-investment offset in part by the decrease in nonaccrual loan balances during the period.

Current wording

When comparing September 30, 2026 to December 31, 2025, the increase in ACL to total loans held-for-investment was primarily due to the increase of the credit enhanced loan portfolio ACL resulting from the change in portfolio composition. The decrease in nonaccrual loans to total loans held-for-investment as shown above was primarily driven by a decline in nonaccrual loan balances and growth in the total loans held-for-investment portfolio during the period. The increase in the ACL to nonaccrual loans ratio as shown above primarily pertained to growth in the credit enhanced loans included in the Strategic Program loans held-for-investment offset in part by the decrease in nonaccrual loan balances during the period.

Previous wording

The following tables summarize net charge-offs (“NCO”), average loans and the ratio of annualized NCO to average loans for the periods indicated:

Current wording

The following tables summarize net charge-offs (“NCO”), average loans from continuing operations and the ratio of annualized NCO to average loans for the periods indicated:

Previous wording

The total ratio of annualized NCO to average loans outstanding was higher during the six months ended June 30, 2026, as compared to the same prior year period, primarily due to higher charge-off activity across the commercial real estate owner-occupied, commercial and industrial, and residential real estate portfolios, as the Company recognized losses in connection with the liquidation of non-performing loans and increased provisioning on loans with characteristics common to those migrating to nonperforming status over the prior 18 months.

Current wording

The total ratio of annualized NCO to average loans outstanding was higher during the nine months ended September 30, 2026, as compared to the same prior year period, primarily due to higher charge-off activity across the commercial real estate owner-occupied, commercial and industrial, and Strategic Program loans related to the credit enhanced program. We recognized losses in connection with the liquidation of non-performing loans and increased provisioning on loans with characteristics common to those migrating to nonperforming status.

Previous wording

The decrease in total deposits as of June 30, 2026 compared to December 31, 2025 of $60.8 million was primarily due to reductions in noninterest-bearing demand deposits and certificates of deposit, as excess funds were not required to support the lower level of assets.

Current wording

The decrease in total deposits as of September 30, 2026 compared to December 31, 2025 of $47.0 million was primarily due to reductions in noninterest-bearing demand deposits and certificates of deposit, as excess funds were not required to support the lower level of assets.

Previous wording

As an FDIC-insured institution, our deposits are insured up to $250,000 per depositor, per insured bank, for each account ownership category. Our total estimated uninsured deposits were $174.4 million and $204.1 million as of June 30, 2026 and December 31, 2025, respectively. Estimated uninsured deposits at the Bank as of June 30, 2026 include $29.0 million of total deposits contractually required to be maintained at the Bank pursuant to our Strategic Program agreements and an additional $52.1 million of total deposits associated with accounts owned by the parent holding company or the Bank. The maturity profile of our uninsured time deposits, those amounts that exceed the FDIC insurance limit, at June 30, 2026 is as follows:

Current wording

As an FDIC-insured institution, our deposits are insured up to $250,000 per depositor, per insured bank, for each account ownership category. Our total estimated uninsured deposits were $180.2 million and $204.1 million as of September 30, 2026 and December 31, 2025, respectively. Estimated uninsured deposits at the Bank as of September 30, 2026 include $47.2 million of total deposits contractually required to be maintained at the Bank pursuant to our Strategic Program agreements and an additional $38.2 million of total deposits associated with accounts owned by the parent holding company or the Bank. The maturity profile of our uninsured time deposits, those amounts that exceed the FDIC insurance limit, at September 30, 2026 is as follows:

Previous wording

Total liabilities decreased to $726.1 million, or 7.4%, as of June 30, 2026 from $783.9 million as of December 31, 2025 primarily due to a decrease in deposits as discussed above.

Current wording

Total liabilities decreased to $750.3 million, or 4.3%, as of September 30, 2026 from $783.9 million as of December 31, 2025 primarily due to a decrease in deposits as discussed above.

Previous wording

We primarily utilize short-term and long-term borrowings to supplement deposits to fund our lending and investment activities. At June 30, 2026, we had the ability to access $177.0 million from the Federal Reserve Bank on a collateralized basis. The Bank had an available unsecured line of credit with three correspondent banks to borrow up to$16.1 million in overnight funds. We also maintain a $10.8 million line of credit with Federal Home Loan Bank, secured by specific pledged loans. We had no outstanding balances on any unsecured or secured lines of credit as of June 30, 2026.

Current wording

We primarily utilize short-term and long-term borrowings to supplement deposits to fund our lending and investment activities. At September 30, 2026, we had the ability to access $168.4 million from the Federal Reserve Bank on a collateralized basis. The Bank had an available unsecured line of credit with three correspondent banks to borrow up to$16.1 million in overnight funds. We also maintain a $7.0 million line of credit with Federal Home Loan Bank, secured by specific pledged loans. We had no outstanding balances on any unsecured or secured lines of credit as of September 30, 2026.

Previous wording

Our most liquid assets are cash and cash equivalents. The levels of these assets depend on our operating, financing, lending and investing activities during any given period. At June 30, 2026, liquid assets (defined as cash and due from banks and interest-bearing deposits) totaled $93.6 million and constituted 10.1% of total assets. We believe that our liquid assets combined with the available lines of credit and our ability to generate core and non-core funding provides adequate liquidity to meet our current financial obligations for at least the next 12 months.

Current wording

Our most liquid assets are cash and cash equivalents. The levels of these assets depend on our operating, financing, lending and investing activities during any given period. At September 30, 2026, liquid assets (defined as cash and due from banks and interest-bearing deposits) totaled $92.6 million and constituted 9.7% of total assets. We believe that our liquid assets combined with the available lines of credit and our ability to generate core and non-core funding provides adequate liquidity to meet our current financial obligations for at least the next 12 months.