FinWise Bancorp (NASDAQ: FINW) (“FinWise” or the “Company”), parent
company of FinWise Bank (the “Bank”), today announced results for
the quarter and full year ended December 31, 2021. The Company’s
shares began trading publicly on November 19, 2021. The Company’s
results are discussed below.
Fourth Quarter 2021 Highlights
- Loan
originations totaled $2.3 billion, up 26.4% from the quarter ended
September 30, 2021 and more than doubled from the prior year
period
- Net interest
income grew to $15.3 million or 13.4% as compared to the quarter
ended September 30, 2021 and rose 87.1% from the prior year
period
- Net Income was
$10.1 million, compared to $8.4 million for the quarter ended
September 30, 2021 and $4.6 million in the prior year period
- Diluted
earnings per share (“EPS”) were $0.90 in the quarter, flat from the
quarter ended September 30, 2021 and up 69.8% from the prior year
period
- Efficiency
ratio was 34.3%, compared to 33.7% in the quarter ended September
30, 2021 and 48.8% in the prior year period
- Maintained
industry-leading returns with annualized return on average equity
(ROAE) of 43.8%, compared to 52.2% in the quarter ended September
30, 2021 and 42.5% in the prior year period
- Asset quality remained strong with
nonperforming loans to total loans ratio of 0.2%
“We had an outstanding fourth quarter and full
year 2021, capped off by the successful completion of our initial
public offering,” said Kent Landvatter, Chief Executive Officer and
President of FinWise. “We made significant progress in key facets
of our business, including continuing to implement our successful
strategy that has resulted in a highly profitable FinTech lending
model with nationwide reach and profitable growth. We are proud of
our diverse and federally regulated product offerings that provide
millions of dollars in loans to small business owners. We also take
pride in our strategic relationships that provide loans across the
credit spectrum and expand access to credit for more consumers,
particularly those with limited access. Our solid results are a
testament to the unique business model that our team has built.
These efforts put FinWise in a great position to continue to expand
our market share and deliver strong performance for both our
customers and shareholders over the long-term.”
Results of Operations
The Company’s fourth quarter of 2021 was
highlighted by substantial loan originations across its primary
lines of business and substantial earnings growth. The Company
maintained its solid efficiency and industry-leading returns.
Selected Financial Data
|
|
For the Three Months Ended |
|
For the Years Ended |
($s in
thousands, except per share amounts, annualized ratios) |
|
12/31/2021 |
|
9/30/2021 |
|
12/31/2020 |
|
12/31/2021 |
|
12/31/2020 |
Net Income |
|
$ |
10,111 |
|
|
$ |
8,442 |
|
|
$ |
4,616 |
|
|
$ |
31,583 |
|
|
$ |
11,198 |
|
Diluted
EPS |
|
$ |
0.90 |
|
|
$ |
0.90 |
|
|
$ |
0.53 |
|
|
$ |
3.27 |
|
|
$ |
1.28 |
|
Return on
average assets |
|
|
11.3 |
% |
|
|
10.8 |
% |
|
|
5.8 |
% |
|
|
9.1 |
% |
|
|
4.5 |
% |
Return on
average equity |
|
|
43.8 |
% |
|
|
52.2 |
% |
|
|
42.5 |
% |
|
|
39.2 |
% |
|
|
28.4 |
% |
Yield on
loans |
|
|
21.6 |
% |
|
|
23.0 |
% |
|
|
12.6 |
% |
|
|
19.0 |
% |
|
|
14.1 |
% |
Cost of
deposits |
|
|
0.8 |
% |
|
|
1.0 |
% |
|
|
1.7 |
% |
|
|
1.1 |
% |
|
|
1.9 |
% |
Net interest
margin |
|
|
16.6 |
% |
|
|
18.3 |
% |
|
|
10.4 |
% |
|
|
15.1 |
% |
|
|
11.0 |
% |
Efficiency
ratio |
|
|
34.3 |
% |
|
|
33.7 |
% |
|
|
48.8 |
% |
|
|
37.0 |
% |
|
|
51.6 |
% |
Tangible
book value per share |
|
$ |
9.04 |
|
|
$ |
7.91 |
|
|
$ |
5.30 |
|
|
$ |
9.04 |
|
|
$ |
5.30 |
|
Tangible
shareholders' equity to tangible assets |
|
|
30.4 |
% |
|
|
20.4 |
% |
|
|
14.4 |
% |
|
|
30.4 |
% |
|
|
14.4 |
% |
Leverage
Ratio (Bank under CBLR) |
|
|
17.7 |
% |
|
|
19.5 |
% |
|
|
16.6 |
% |
|
|
17.7 |
% |
|
|
16.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
Net Income
Net income was $10.1 million for the fourth
quarter of 2021, compared to $8.4 million for the third quarter of
2021, and more than double the net income for the fourth quarter of
2020. Growth over both prior periods was primarily driven by solid
growth in net interest income due to a substantial increase in loan
originations, as well as solid non-interest income reflecting
substantial strategic program fees, partially offset by an increase
in non-interest expense.
Net Interest Income
Net interest income grew 13.4% to $15.3 million
for the fourth quarter of 2021, from $13.5 million for the third
quarter of 2021, and increased 87.1% from $8.2 million for the
fourth quarter of 2020. Net interest income growth over both prior
periods was primarily due to higher loan balances resulting from
significant loan growth which drove an increase in average interest
earning assets.
Loan originations totaled $2.3 billion for the
fourth quarter 2021, up 26.4% from $1.8 billion for the third
quarter of 2021, and up from $0.9 billion for the fourth quarter of
2020.
Net interest margin for the fourth quarter of
2021 was 16.6% compared to 18.3% for the third quarter of 2021, and
increased significantly from 10.4% for the fourth quarter of 2020.
The net interest margin decline from the third quarter of 2021 was
driven mainly by substantially higher average held for sale loan
balances from strategic programs with lower yielding loans.
Additionally, there was a change in the underlying mix of held for
investment loans driven primarily by an increase in SBA 7(a) loans.
These factors were partially offset by lower rates on the Company’s
deposit portfolio. The net interest margin increase from the fourth
quarter of 2020 was driven mainly by a substantial reduction in
average PPP loans with a notional interest rate of 1.0%
outstanding.
Provision for Loan Losses
The Company’s provision for loan losses was $2.5
million for the fourth quarter of 2021, compared to $3.4 million
for the third quarter of 2021. This decrease from the third quarter
of 2021 was primarily due to a decline in the rate of growth on
held for investment loans. The increase in the Company’s provision
for loan losses for the fourth quarter of 2021 compared to the
fourth quarter of 2020 was due to the Company concluding that a
provision was not needed in the fourth quarter of 2020 when the
Company determined that its loan portfolios were not materially
impacted by the pandemic, particularly as the Company had already
recorded higher than normal provisions to position for the
possibility of elevated losses on loans resulting from the
pandemic.
Non-interest Income
|
|
For the Three Months Ended |
($s in
thousands) |
|
12/31/2021 |
|
9/30/2021 |
|
12/31/2020 |
Non-interest
income: |
|
|
|
|
|
|
Strategic program fees |
|
$ |
6,082 |
|
|
$ |
4,982 |
|
|
$ |
2,713 |
|
Gain on sale of loans |
|
|
1,813 |
|
|
|
2,876 |
|
|
|
289 |
|
SBA loan servicing fees |
|
|
356 |
|
|
|
337 |
|
|
|
283 |
|
Change in fair value on investment in BFG |
|
|
864 |
|
|
|
266 |
|
|
|
137 |
|
Other miscellaneous income |
|
|
14 |
|
|
|
14 |
|
|
|
10 |
|
Total
non-interest income |
|
$ |
9,129 |
|
|
$ |
8,475 |
|
|
$ |
3,432 |
|
|
|
|
|
|
|
|
Non-interest income was $9.1 million for the
fourth quarter of 2021, an increase of 7.7% from $8.5 million for
the third quarter of 2021, and more than doubled from $3.4 million
for the fourth quarter of 2020. The increase compared to the third
quarter of 2021 was driven primarily by an increase in strategic
program fees generated from significant loan origination volume as
well as the change in fair value on investment in Business Funding
Group, LLC (“BFG”). The increase in the latter was primarily due to
BFG’s higher profitability and cash position. The increase compared
to the third quarter of 2021 was partially offset by a decrease in
the gain on sale of loans due primarily to a decrease in the number
of SBA 7(a) loans sold. The increase in non-interest income
compared to the fourth quarter of 2020 was driven mainly by higher
strategic program fees due to significant loan origination volume
and an increase in the number of SBA 7(a) loans sold in the fourth
quarter of 2021.
Non-interest Expense
|
|
|
|
|
|
|
|
|
For the Three Months Ended |
($s in
thousands) |
|
12/31/2021 |
|
9/30/2021 |
|
12/31/2020 |
Non-interest
expense: |
|
|
|
|
|
|
Salaries and employee benefits |
|
$ |
6,052 |
|
|
$ |
5,930 |
|
|
$ |
4,499 |
|
Occupancy and equipment expenses |
|
|
208 |
|
|
|
205 |
|
|
|
181 |
|
Impairment of SBA servicing asset |
|
|
800 |
|
|
|
- |
|
|
|
- |
|
Other operating expenses |
|
|
1,311 |
|
|
|
1,263 |
|
|
|
977 |
|
Total
non-interest expense |
|
$ |
8,371 |
|
|
$ |
7,398 |
|
|
$ |
5,657 |
|
|
|
|
|
|
|
|
Non-interest expense was $8.4 million for the
fourth quarter of 2021, compared to $7.4 million for the third
quarter of 2021 and $5.7 million for the fourth quarter of 2020.
The increase over both prior periods was primarily due to various
factors including increases in the number of employees related to
an increase in strategic program loan volume, the expansion of the
Company’s information technology and security division to support
enhancements to the Company’s infrastructure, contractual bonuses
paid relating to the expansion of the strategic programs, and an
impairment on SBA servicing asset due to the softening of the
secondary market for SBA 7(a) loans.
The Company’s efficiency ratio was 34.3% for the
fourth quarter of 2021 as compared to 33.7% for the third quarter
of 2021 and 48.8% for the fourth quarter of 2020.
Tax Rate
The Company’s effective tax rate was
approximately 25.3% for the fourth quarter of 2021, compared to
24.5% for the third quarter of 2021 and 22.2% for the fourth
quarter of 2020.
Balance Sheet
The Company’s total assets increased 12.4%, from
$338.3 million at September 30, 2021 and increased 19.7%, from
$317.5 million at December 31, 2020 to $380.2 million at December
31, 2021. The increase over both prior periods was mainly due to an
increase in cash from the Company’s public stock offering and
growth in the SBA 7(a) loan portfolio. The increase in total assets
compared to December 31, 2020 was also impacted by an increase in
strategic program loans held-for-sale offset by a substantial
decrease in PPP loans outstanding.
The following table shows the loan portfolio as
of the dates indicated:
|
|
As of |
|
|
12/31/2021 |
|
9/30/2021 |
|
12/31/2020 |
($s in
thousands) |
|
Amount |
|
% of totalloans |
|
Amount |
|
% of totalloans |
|
Amount |
|
% of totalloans |
SBA |
|
$ |
142,392 |
|
|
|
53.6 |
% |
|
$ |
125,192 |
|
|
|
50.2 |
% |
|
$ |
203,317 |
|
|
77.7 |
% |
Commercial, non real estate |
|
|
3,428 |
|
|
|
1.3 |
% |
|
|
3,955 |
|
|
|
1.6 |
% |
|
|
4,020 |
|
|
1.5 |
% |
Residential real estate |
|
|
27,108 |
|
|
|
10.2 |
% |
|
|
25,105 |
|
|
|
10.1 |
% |
|
|
17,740 |
|
|
6.8 |
% |
Strategic Program loans |
|
|
85,850 |
|
|
|
32.3 |
% |
|
|
87,876 |
|
|
|
35.3 |
% |
|
|
28,265 |
|
|
10.8 |
% |
Commercial real estate |
|
|
2,436 |
|
|
|
0.9 |
% |
|
|
2,357 |
|
|
|
0.9 |
% |
|
|
2,892 |
|
|
1.1 |
% |
Consumer |
|
|
4,574 |
|
|
|
1.7 |
% |
|
|
4,729 |
|
|
|
1.9 |
% |
|
|
5,543 |
|
|
2.1 |
% |
Total period
end loans |
|
$ |
265,788 |
|
|
|
100.0 |
% |
|
$ |
249,214 |
|
|
|
100.0 |
% |
|
$ |
261,777 |
|
|
100.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: SBA loans as
of December 31, 2021, September 30, 2021 and December 31, 2020
include $1.1 million, $2.3 million and $107.1 million in PPP loans
respectively. |
Total period end loans receivable increased 6.7%
from $249.2 million at September 30, 2021 and increased 1.5%, from
$261.8 million at December 31, 2020 to $265.8 million at December
31, 2021. The growth in loans receivable in the fourth quarter of
2021 compared to the third quarter of 2021 was due primarily to
increases in SBA 7(a) loans. Year-over-year, the increase in loans
receivable was driven primarily by the growth in SBA 7(a),
strategic program, and residential real estate loans offset by a
substantial decrease in PPP loans due to PPP loan forgiveness
throughout 2021.
The following table shows the deposit composition as of the
dates indicated:
|
|
As of |
|
|
12/31/2021 |
|
9/30/2021 |
|
12/31/2020 |
($s in
thousands) |
|
Total |
|
Percent |
|
Total |
|
Percent |
|
Total |
|
Percent |
Noninterest-bearing demand deposits |
|
$ |
110,548 |
|
|
|
43.9 |
% |
|
$ |
109,459 |
|
|
|
43.4 |
% |
|
$ |
88,067 |
|
|
53.5 |
% |
Interest-bearing deposits: |
|
|
|
|
|
|
|
|
|
|
|
|
Demand |
|
|
5,399 |
|
|
|
2.1 |
% |
|
|
5,398 |
|
|
|
2.1 |
% |
|
|
6,095 |
|
|
3.7 |
% |
Savings |
|
|
6,685 |
|
|
|
2.7 |
% |
|
|
8,146 |
|
|
|
3.2 |
% |
|
|
7,435 |
|
|
4.5 |
% |
Money markets |
|
|
31,076 |
|
|
|
12.3 |
% |
|
|
25,679 |
|
|
|
10.1 |
% |
|
|
17,567 |
|
|
10.7 |
% |
Time certificates of deposit |
|
|
98,184 |
|
|
|
39.0 |
% |
|
|
104,354 |
|
|
|
41.2 |
% |
|
|
45,312 |
|
|
27.6 |
% |
Total period
end deposits |
|
$ |
251,892 |
|
|
|
100.0 |
% |
|
$ |
253,036 |
|
|
|
100.0 |
% |
|
$ |
164,476 |
|
|
100.0 |
% |
Total period end deposits decreased (0.5%), from
$253.0 million at September 30, 2021, and increased 53.1% from
$164.5 million at December 31, 2020 to $251.9 million at December
31, 2021. The decline from the third quarter of 2021 was driven
primarily by a decline in certificates of deposit. The increase
from the fourth quarter of 2020 was driven by a significant
increase in time certificates of deposit, noninterest-bearing
demand deposits, and money market accounts.
Total shareholders’ equity increased $46.3
million, or 67.0%, to $115.4 million at December 31, 2021 from
$69.1 million at September 30, 2021. Year-over-year shareholder’s
equity increased $69.6 million during 2021. The increase in
shareholders’ equity over both prior periods was primarily due to
substantial net income and the Company’s IPO.
Bank Regulatory Capital Ratios
The following table presents the leverage ratios for the Bank as
of the dates indicated:
|
|
As of |
|
|
|
|
12/31/2021 |
|
9/30/2021 |
|
Well-CapitalizedRequirement |
Leverage
Ratio (Bank under CBLR) |
|
17.7% |
|
19.5% |
|
8.5% |
The Bank’s capital levels remain significantly
above well-capitalized guidelines as of the end of the fourth
quarter of 2021.
Asset QualityNonperforming
loans were $0.7 million or 0.2% of total loans receivable at
December 31, 2021, compared to $0.8 million or 0.3% of total loans
receivable at September 30, 2021 and $0.8 million or 0.3% of total
loans receivable at December 31, 2020. As noted above, the
provision for loan losses was $2.5 million for the fourth quarter
of 2021, compared to $3.4 million for the third quarter of 2021.
The Company also determined that a provision for loan losses was
not needed in the fourth quarter of 2020. The Company’s allowance
for loan losses to total loans (less PPP loans) was 3.7% at
December 31, 2021 compared to 3.9% at September 30, 2021 and 4.0%
at December 31, 2020. During the fourth quarter 2021, the Company’s
net charge-offs were $2.3 million, compared to $1.0 million during
the third quarter of 2021 and $0.8 million during the fourth
quarter of 2020. The increase in charge-offs during the fourth
quarter of 2021 compared to both prior periods was predominately
driven by growth in the Company’s held for investment balances
related to two of its strategic programs.
The following table presents a summary of changes in the
allowance for loan losses and asset quality ratios for the periods
indicated:
|
|
For the Three Months Ended |
($s in
thousands) |
|
12/31/2021 |
|
9/30/2021 |
|
12/31/2020 |
Allowance
for Loan & Lease Losses: |
|
|
|
|
|
|
Beginning Balance |
|
$ |
9,640 |
|
|
$ |
7,239 |
|
|
$ |
7,028 |
|
Provision |
|
|
2,502 |
|
|
|
3,368 |
|
|
|
- |
|
Charge offs |
|
|
- |
|
|
|
- |
|
|
|
- |
|
SBA |
|
|
(100 |
) |
|
|
- |
|
|
|
(17 |
) |
Commercial, non real estate |
|
|
- |
|
|
|
- |
|
|
|
(232 |
) |
Residential real estate |
|
|
- |
|
|
|
- |
|
|
|
- |
|
Strategic Program loans |
|
|
(2,379 |
) |
|
|
(1,106 |
) |
|
|
(628 |
) |
Commercial real estate |
|
|
- |
|
|
|
- |
|
|
|
- |
|
Consumer |
|
|
- |
|
|
|
- |
|
|
|
(11 |
) |
Recoveries |
|
|
- |
|
|
|
- |
|
|
|
- |
|
SBA |
|
|
4 |
|
|
|
30 |
|
|
|
- |
|
Commercial, non real estate |
|
|
11 |
|
|
|
10 |
|
|
|
- |
|
Residential real estate |
|
|
- |
|
|
|
- |
|
|
|
- |
|
Strategic Program loans |
|
|
177 |
|
|
|
99 |
|
|
|
58 |
|
Commercial real estate |
|
|
- |
|
|
|
- |
|
|
|
1 |
|
Consumer |
|
|
- |
|
|
|
- |
|
|
|
- |
|
Ending
Balance |
|
$ |
9,855 |
|
|
$ |
9,640 |
|
|
$ |
6,199 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset
Quality Ratios |
|
As of and For the Three Months Ended |
($s in
thousands, annualized ratios) |
|
12/31/2021 |
|
9/30/2021 |
|
12/31/2020 |
Nonperforming loans |
|
$ |
657 |
|
|
$ |
757 |
|
|
$ |
831 |
|
Nonperforming loans to total loans |
|
|
0.2 |
% |
|
|
0.3 |
% |
|
|
0.3 |
% |
Net charge
offs to average loans |
|
|
3.2 |
% |
|
|
1.6 |
% |
|
|
1.2 |
% |
Allowance
for loan losses to loans held for investment |
|
|
4.8 |
% |
|
|
5.2 |
% |
|
|
2.6 |
% |
Allowance
for loan losses to total loans |
|
|
3.7 |
% |
|
|
3.9 |
% |
|
|
2.4 |
% |
Allowance
for loan losses to total loans (less PPP loans) |
|
|
3.7 |
% |
|
|
3.9 |
% |
|
|
4.0 |
% |
Net charge-offs |
|
$ |
2,287 |
|
|
$ |
967 |
|
|
$ |
829 |
|
Webcast and
Conference
Call
Information
FinWise will host a conference call today at
5:00 PM ET to discuss its financial results for the fourth quarter
of 2021. A simultaneous audio webcast of the conference call will
be available on the Company’s investor relations section of the
website at
https://viavid.webcasts.com/viewer/event.jsp?ei=1526843&tp_key=5f9c7ab843
The dial-in number for the conference call is
(877) 423-9813 (toll-free) or (201) 689-8573 (international).
Please dial the number 10 minutes prior to the scheduled start
time.
A webcast replay of the call will be available
on the Company’s website at https://finwisebank.gcs-web.com for six
months following the call.
Website InformationThe Company
intends to use its website, www.finwisebancorp.com, as a means of
disclosing material non-public information and for complying with
its disclosure obligations under Regulation FD. Such disclosures
will be included in the Company’s website’s Investor Relations
section. Accordingly, investors should monitor the Investor
Relations portion of the Company’s website, in addition to
following its press releases, SEC filings, public conference calls,
and webcasts. To subscribe to the Company’s e-mail alert service,
please click the “Email Alerts” link in the Investor Relations
section of its website and submit your email address. The
information contained in, or that may be accessed through, the
Company’s website is not incorporated by reference into or a part
of this document or any other report or document it files with or
furnishes to the SEC, and any references to the Company’s website
are intended to be inactive textual references only.
About FinWise Bancorp
FinWise Bancorp is a Utah bank holding company
headquartered in Murray, Utah. FinWise operates through its
wholly-owned subsidiary, FinWise Bank, a Utah state-chartered
non-member bank. FinWise currently operates one full-service
banking location in Sandy, Utah and a loan production office in
Rockville Centre, New York. FinWise is a nationwide lender to and
takes deposits from consumers and small businesses. Learn more at
www.finwisebancorp.com.
Contacts
investors@finwisebank.com
media@finwisebank.com
"Safe Harbor" Statement Under the Private Securities
Litigation Reform Act of 1995
This release contains forward-looking statements
made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. These forward-looking
statements reflect the Company’s current views with respect to,
among other things, future events and its financial performance.
These statements are often, but not always, made through the use of
words or phrases such as “may,” “might,” “should,” “could,”
“predict,” “potential,” “believe,” “will likely result,” “expect,”
“continue,” “will,” “anticipate,” “seek,” “estimate,” “intend,”
“plan,” “project,” “projection,” “forecast,” “budget,” “goal,”
“target,” “would,” “aim” and “outlook,” or the negative version of
those words or other comparable words or phrases of a future or
forward-looking nature. These forward-looking statements are not
historical facts, and are based on current expectations, estimates
and projections about the Company’s industry and management’s
beliefs and certain assumptions made by management, many of which,
by their nature, are inherently uncertain and beyond the Company’s
control. The inclusion of these forward-looking statements should
not be regarded as a representation by the Company or any other
person that such expectations, estimates and projections will be
achieved. Accordingly, the Company cautions you that any such
forward-looking statements are not guarantees of future performance
and are subject to risks, assumptions and uncertainties that are
difficult to predict. Although the Company believes that the
expectations reflected in these forward-looking statements are
reasonable as of the date made, actual results may prove to be
materially different from the results expressed or implied by the
forward-looking statements.
There are or will be important factors that
could cause the Company’s actual results to differ materially from
those indicated in these forward-looking statements, including, but
not limited to, the following:
- conditions
relating to the Covid-19 pandemic, including the severity and
duration of the associated economic slowdown either nationally or
in the Company’s market areas, and the response of governmental
authorities to the Covid-19 pandemic and the Company’s
participation in Covid-19-related government programs such as the
PPP;
- system failure
or cybersecurity breaches of the Company’s network security;
- the success of
the financial technology industry, the development and acceptance
of which is subject to a high degree of uncertainty, as well as the
continued evolution of the regulation of this industry;
- the Company’s
ability to keep pace with rapid technological changes in the
industry or implement new technology effectively;
- the Company’s
reliance on third-party service providers for core systems support,
informational website hosting, internet services, online account
opening and other processing services;
- general
economic conditions, either nationally or in the Company’s market
areas (including interest rate environment, government economic and
monetary policies, the strength of global financial markets and
inflation and deflation), that impact the financial services
industry and/or the Company’s business;
- increased
competition in the financial services industry, particularly from
regional and national institutions and other companies that offer
banking services;
- the Company’s
ability to measure and manage its credit risk effectively and the
potential deterioration of the business and economic conditions in
the Company’s primary market areas;
- the adequacy of
the Company’s risk management framework;
- the adequacy of
the Company’s allowance for loan losses;
- the financial
soundness of other financial institutions;
- new lines of
business or new products and services;
- changes in SBA
rules, regulations and loan products, including specifically the
Section 7(a) program, changes in SBA standard operating procedures
or changes to the status of the Bank as an SBA Preferred
Lender;
- changes in the
value of collateral securing the Company’s loans;
- possible
increases in the Company’s levels of nonperforming assets;
- potential
losses from loan defaults and nonperformance on loans;
- the Company’s
ability to protect its intellectual property and the risks it faces
with respect to claims and litigation initiated against the
Company;
- the inability
of small- and medium-sized businesses to whom the Company lends to
weather adverse business conditions and repay loans;
- the Company’s
ability to implement aspects of its growth strategy and to sustain
its historic rate of growth;
- the Company’s
ability to continue to originate, sell and retain loans, including
through its Strategic Programs;
- the
concentration of the Company’s lending and depositor relationships
through Strategic Programs in the financial technology industry
generally;
- the Company’s
ability to attract additional merchants and retain and grow its
existing merchant relationships;
- interest rate
risk associated with the Company’s business, including sensitivity
of its interest earning assets and interest-bearing liabilities to
interest rates, and the impact to its earnings from changes in
interest rates;
- the
effectiveness of the Company’s internal control over financial
reporting and its ability to remediate any future material weakness
in its internal control over financial reporting;
- potential
exposure to fraud, negligence, computer theft and cyber-crime and
other disruptions in the Company’s computer systems relating to its
development and use of new technology platforms;
- the Company’s
dependence on its management team and changes in management
composition;
- the sufficiency
of the Company’s capital, including sources of capital and the
extent to which it may be required to raise additional capital to
meet its goals;
- compliance with
laws and regulations, supervisory actions, the Dodd-Frank Act, the
Regulatory Relief Act, capital requirements, the Bank Secrecy Act,
anti-money laundering laws, predatory lending laws, and other
statutes and regulations;
- changes in the
laws, rules, regulations, interpretations or policies relating to
financial institutions, accounting, tax, trade, monetary and fiscal
matters;
- the Company’s
ability to maintain a strong core deposit base or other low-cost
funding sources;
- results of
examinations of the Company by the Company’s regulators, including
the possibility that its regulators may, among other things,
require the Company to increase its allowance for loan losses or to
write-down assets;
- the Company’s
involvement from time to time in legal proceedings, examinations
and remedial actions by regulators;
- further
government intervention in the U.S. financial system;
- the ability of
the Company’s Strategic Program service providers to comply with
regulatory regimes, including laws and regulations applicable to
consumer credit transactions, and the Company’s ability to
adequately oversee and monitor its Strategic Program service
providers;
- the Company’s
ability to maintain and grow its relationships with its Strategic
Program service providers;
- natural
disasters and adverse weather, acts of terrorism, pandemics, an
outbreak of hostilities or other international or domestic
calamities, and other matters beyond the Company’s control;
- future equity
and debt issuances; and
- other factors
listed from time to time in the Company’s filings with the
Securities and Exchange Commission, including, without limitation,
its Registration Statement on Form S-1, as amended (File No.
333-257929) and subsequent reports on Form 10-K, Form 10-Q and Form
8-K.
The foregoing factors should not be construed as
exhaustive. If one or more events related to these or other risks
or uncertainties materialize, or if the Company’s underlying
assumptions prove to be incorrect, actual results may differ
materially from its forward-looking statements. Accordingly, you
should not place undue reliance on any such forward-looking
statements. Any forward-looking statement speaks only as of the
date of this release, and the Company does not undertake any
obligation to publicly update or review any forward-looking
statement, whether because of new information, future developments
or otherwise, except as required by law. New risks and
uncertainties may emerge from time to time, and it is not possible
for the Company to predict their occurrence. In addition, the
Company cannot assess the impact of each risk and uncertainty on
its business or the extent to which any risk or uncertainty, or
combination of risks and uncertainties, may cause actual results to
differ materially from those contained in any forward-looking
statements.
|
FINWISE BANCORP CONDENSED
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION($s
in thousands; unaudited) |
|
|
|
As of |
($s in
thousands) |
|
12/31/2021 |
|
9/30/2021 |
|
12/31/2020 |
ASSETS |
|
|
|
|
|
|
Cash and cash equivalents |
|
|
|
|
|
|
Cash and due from banks |
|
$ |
411 |
|
|
$ |
410 |
|
|
$ |
405 |
|
Interest bearing deposits |
|
|
85,343 |
|
|
|
67,696 |
|
|
|
46,978 |
|
Total cash and cash equivalents |
|
|
85,754 |
|
|
|
68,106 |
|
|
|
47,383 |
|
Investment securities held-to-maturity, at cost |
|
|
11,423 |
|
|
|
4,414 |
|
|
|
1,809 |
|
Investment in Federal Home Loan Bank (FHLB) stock, at cost |
|
|
378 |
|
|
|
377 |
|
|
|
205 |
|
Loans receivable, net |
|
|
198,102 |
|
|
|
178,748 |
|
|
|
232,074 |
|
Strategic Program loans held-for-sale, at lower of cost or fair
value |
|
|
60,748 |
|
|
|
62,702 |
|
|
|
20,948 |
|
Premises and equipment, net |
|
|
3,285 |
|
|
|
2,484 |
|
|
|
1,264 |
|
Accrued interest receivable |
|
|
1,548 |
|
|
|
1,297 |
|
|
|
1,629 |
|
Deferred taxes, net |
|
|
1,823 |
|
|
|
1,597 |
|
|
|
452 |
|
SBA servicing asset, net |
|
|
3,938 |
|
|
|
4,368 |
|
|
|
2,415 |
|
Investment in Business Funding Group (BFG), at fair value |
|
|
5,900 |
|
|
|
5,241 |
|
|
|
3,770 |
|
Investment in FinWise Investments, LLC |
|
|
80 |
|
|
|
- |
|
|
|
- |
|
Other assets |
|
|
7,235 |
|
|
|
8,982 |
|
|
|
5,566 |
|
Total assets |
|
$ |
380,214 |
|
|
$ |
338,316 |
|
|
$ |
317,515 |
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY |
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
Deposits |
|
|
|
|
|
|
Noninterest bearing |
|
$ |
110,548 |
|
|
$ |
109,459 |
|
|
$ |
88,067 |
|
Interest bearing |
|
|
141,344 |
|
|
|
143,577 |
|
|
|
76,409 |
|
Total deposits |
|
|
251,892 |
|
|
|
253,036 |
|
|
|
164,476 |
|
Accrued interest payable |
|
|
48 |
|
|
|
43 |
|
|
|
195 |
|
Income taxes payable, net |
|
|
233 |
|
|
|
823 |
|
|
|
709 |
|
PPP Liquidity Facility |
|
|
1,050 |
|
|
|
2,259 |
|
|
|
101,007 |
|
Other liabilities |
|
|
11,549 |
|
|
|
13,017 |
|
|
|
5,256 |
|
Total liabilities |
|
|
264,772 |
|
|
|
269,178 |
|
|
|
271,643 |
|
|
|
|
|
|
|
|
Shareholders' equity |
|
|
|
|
|
|
Common stock |
|
|
13 |
|
|
|
9 |
|
|
|
9 |
|
Additional paid-in-capital |
|
|
54,836 |
|
|
|
18,647 |
|
|
|
16,853 |
|
Retained earnings |
|
|
60,593 |
|
|
|
50,482 |
|
|
|
29,010 |
|
Total shareholders' equity |
|
|
115,442 |
|
|
|
69,138 |
|
|
|
45,872 |
|
Total liabilities and shareholders' equity |
|
$ |
380,214 |
|
|
$ |
338,316 |
|
|
$ |
317,515 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FINWISE
BANCORPCONDENSED CONSOLIDATED STATEMENTS OF
INCOME ($s in thousands, except per share amounts;
unaudited) |
|
|
|
|
|
|
|
|
|
For the Three Months Ended |
($s in
thousands, except per share amounts) |
|
12/31/2021 |
|
9/30/2021 |
|
12/31/2020 |
Interest income |
|
|
|
|
|
|
Interest and fees on loans |
|
$ |
15,500 |
|
|
$ |
13,726 |
|
|
$ |
8,548 |
|
Interest on securities |
|
|
28 |
|
|
|
7 |
|
|
|
9 |
|
Other interest income |
|
|
25 |
|
|
|
16 |
|
|
|
8 |
|
Total
interest income |
|
|
15,553 |
|
|
|
13,749 |
|
|
|
8,565 |
|
|
|
|
|
|
|
|
Interest expense |
|
|
|
|
|
|
Interest on deposits |
|
|
279 |
|
|
|
271 |
|
|
|
331 |
|
Interest on PPP Liquidity Facility |
|
|
2 |
|
|
|
8 |
|
|
|
73 |
|
Total
interest expense |
|
|
281 |
|
|
|
279 |
|
|
|
404 |
|
Net
interest income |
|
|
15,272 |
|
|
|
13,470 |
|
|
|
8,161 |
|
|
|
|
|
|
|
|
Provision
for loan losses |
|
|
2,503 |
|
|
|
3,367 |
|
|
|
- |
|
Net interest
income after provision for loan losses |
|
|
12,769 |
|
|
|
10,103 |
|
|
|
8,161 |
|
|
|
|
|
|
|
|
Non-interest income |
|
|
|
|
|
|
Strategic Program fees |
|
|
6,082 |
|
|
|
4,982 |
|
|
|
2,713 |
|
Gain on sale of loans |
|
|
1,813 |
|
|
|
2,876 |
|
|
|
289 |
|
SBA loan servicing fees |
|
|
356 |
|
|
|
337 |
|
|
|
283 |
|
Change in fair value on investment in BFG |
|
|
864 |
|
|
|
266 |
|
|
|
137 |
|
Other miscellaneous income |
|
|
14 |
|
|
|
14 |
|
|
|
10 |
|
Total
non-interest income |
|
|
9,129 |
|
|
|
8,475 |
|
|
|
3,432 |
|
|
|
|
|
|
|
|
Non-interest expense |
|
|
|
|
|
|
Salaries and employee benefits |
|
|
6,052 |
|
|
|
5,930 |
|
|
|
4,499 |
|
Occupancy and equipment expenses |
|
|
208 |
|
|
|
205 |
|
|
|
181 |
|
Impairment of SBA servicing asset |
|
|
800 |
|
|
|
- |
|
|
|
- |
|
Other operating expenses |
|
|
1,311 |
|
|
|
1,263 |
|
|
|
977 |
|
Total
non-interest expense |
|
|
8,371 |
|
|
|
7,398 |
|
|
|
5,657 |
|
Income before income tax expense |
|
|
13,527 |
|
|
|
11,180 |
|
|
|
5,936 |
|
|
|
|
|
|
|
|
Provision
for income taxes |
|
|
3,416 |
|
|
|
2,738 |
|
|
|
1,320 |
|
Net
income |
|
$ |
10,111 |
|
|
$ |
8,442 |
|
|
$ |
4,616 |
|
|
|
|
|
|
|
|
Earnings per
share, basic |
|
$ |
0.95 |
|
|
$ |
0.97 |
|
|
$ |
0.53 |
|
Earnings per
share, diluted |
|
$ |
0.90 |
|
|
$ |
0.90 |
|
|
$ |
0.53 |
|
|
|
|
|
|
|
|
Weighted
average shares outstanding, basic |
|
|
10,169,005 |
|
|
|
8,255,953 |
|
|
|
8,035,778 |
|
Weighted
average shares outstanding, diluted |
|
|
10,818,984 |
|
|
|
8,847,606 |
|
|
|
8,081,470 |
|
Shares
outstanding at end of period |
|
|
12,772,010 |
|
|
|
8,746,110 |
|
|
|
8,660,334 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FINWISE
BANCORPCONDENSED CONSOLIDATED STATEMENTS OF
INCOME($s in thousands, except per share amounts;
unaudited) |
|
|
|
|
|
|
|
|
|
For the Years Ended |
|
|
($s in
thousands, except per share amounts) |
|
12/31/2021 |
|
12/31/2020 |
|
|
Interest income |
|
|
|
|
|
|
Interest and fees on loans |
|
$ |
49,135 |
|
|
$ |
29,271 |
|
|
|
Interest on securities |
|
|
47 |
|
|
|
34 |
|
|
|
Other interest income |
|
|
61 |
|
|
|
201 |
|
|
|
Total
interest income |
|
|
49,243 |
|
|
|
29,506 |
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
|
|
|
|
|
Interest on deposits |
|
|
1,138 |
|
|
|
1,583 |
|
|
|
Interest on PPP Liquidity Facility |
|
|
127 |
|
|
|
173 |
|
|
|
Total
interest expense |
|
|
1,265 |
|
|
|
1,756 |
|
|
|
Net
interest income |
|
|
47,978 |
|
|
|
27,750 |
|
|
|
|
|
|
|
|
|
|
Provision
for loan losses |
|
|
8,039 |
|
|
|
5,234 |
|
|
|
Net interest
income after provision for loan losses |
|
|
39,939 |
|
|
|
22,516 |
|
|
|
|
|
|
|
|
|
|
Non-interest income |
|
|
|
|
|
|
Strategic Program fees |
|
|
17,959 |
|
|
|
9,591 |
|
|
|
Gain on sale of loans |
|
|
9,689 |
|
|
|
2,849 |
|
|
|
SBA loan servicing fees |
|
|
1,156 |
|
|
|
1,028 |
|
|
|
Change in fair value on investment in BFG |
|
|
2,991 |
|
|
|
856 |
|
|
|
Other miscellaneous income |
|
|
49 |
|
|
|
49 |
|
|
|
Total
non-interest income |
|
|
31,844 |
|
|
|
14,373 |
|
|
|
|
|
|
|
|
|
|
Non-interest expense |
|
|
|
|
|
|
Salaries and employee benefits |
|
|
22,365 |
|
|
|
16,835 |
|
|
|
Occupancy and equipment expenses |
|
|
810 |
|
|
|
694 |
|
|
|
Impairment of SBA servicing asset |
|
|
800 |
|
|
|
- |
|
|
|
Loss on investment in BFG |
|
|
- |
|
|
|
50 |
|
|
|
Other operating expenses |
|
|
5,536 |
|
|
|
4,170 |
|
|
|
Total
non-interest expense |
|
|
29,511 |
|
|
|
21,749 |
|
|
|
Income before income tax expense |
|
|
42,272 |
|
|
|
15,140 |
|
|
|
|
|
|
|
|
|
|
Provision
for income taxes |
|
|
10,689 |
|
|
|
3,942 |
|
|
|
Net
income |
|
$ |
31,583 |
|
|
$ |
11,198 |
|
|
|
|
|
|
|
|
|
|
Earnings per
share, basic |
|
$ |
3.44 |
|
|
$ |
1.29 |
|
|
|
Earnings per
share, diluted |
|
$ |
3.27 |
|
|
$ |
1.28 |
|
|
|
|
|
|
|
|
|
|
Weighted
average shares outstanding, basic |
|
|
8,669,724 |
|
|
|
8,025,390 |
|
|
|
Weighted
average shares outstanding, diluted |
|
|
9,108,163 |
|
|
|
8,069,634 |
|
|
|
Shares
outstanding at end of period |
|
|
12,772,010 |
|
|
|
8,660,334 |
|
|
|
|
|
|
|
|
|
|
|
FINWISE
BANCORPAVERAGE BALANCES, YIELDS, AND RATES -
QUARTERLY($s in thousands;
unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended |
|
For the Three Months Ended |
|
For the Three Months Ended |
|
|
12/31/2021 |
|
9/30/2021 |
|
12/31/2020 |
($s in thousands, annualized ratios) |
|
AverageBalance |
|
Interest |
|
AverageYield/Rate |
|
Average Balance |
|
Interest |
|
Average Yield/Rate |
|
Average Balance |
|
Interest |
|
Average Yield/Rate |
Interest earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing deposits with the Federal Reserve, non-U.S.
central banks and other banks |
|
$ |
72,746 |
|
|
|
25 |
|
|
|
0.1 |
% |
|
$ |
54,261 |
|
|
|
16 |
|
|
0.1 |
% |
|
$ |
40,155 |
|
|
|
8 |
|
0.1 |
% |
Investment securities |
|
|
8,078 |
|
|
|
28 |
|
|
|
1.4 |
% |
|
|
1,689 |
|
|
|
7 |
|
|
1.7 |
% |
|
|
1,887 |
|
|
|
9 |
|
1.9 |
% |
Loans held for sale |
|
|
87,156 |
|
|
|
7,553 |
|
|
|
34.7 |
% |
|
|
65,273 |
|
|
|
6,293 |
|
|
38.6 |
% |
|
|
29,329 |
|
|
|
3,597 |
|
49.1 |
% |
Loans held for investment |
|
|
199,609 |
|
|
|
7,947 |
|
|
|
15.9 |
% |
|
|
173,092 |
|
|
|
7,433 |
|
|
17.2 |
% |
|
|
241,600 |
|
|
|
4,951 |
|
8.2 |
% |
Total interest earning assets |
|
|
367,589 |
|
|
|
15,553 |
|
|
|
16.9 |
% |
|
|
294,315 |
|
|
|
13,749 |
|
|
18.7 |
% |
|
|
312,971 |
|
|
|
8,565 |
|
10.9 |
% |
Less: allowance for loan losses |
|
|
(9,450 |
) |
|
|
|
|
|
|
(8,083 |
) |
|
|
|
|
|
|
(6,753 |
) |
|
|
|
|
Non-interest earning assets |
|
|
24,379 |
|
|
|
|
|
|
|
18,822 |
|
|
|
|
|
|
|
9,222 |
|
|
|
|
|
Total assets |
|
$ |
382,518 |
|
|
|
|
|
|
$ |
305,054 |
|
|
|
|
|
|
$ |
315,440 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest bearing liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand |
|
$ |
7,411 |
|
|
$ |
15 |
|
|
|
0.8 |
% |
|
$ |
5,007 |
|
|
$ |
11 |
|
|
0.9 |
% |
|
$ |
6,226 |
|
|
$ |
15 |
|
1.0 |
% |
Savings |
|
|
7,573 |
|
|
|
1 |
|
|
|
0.1 |
% |
|
|
8,818 |
|
|
|
3 |
|
|
0.1 |
% |
|
|
6,775 |
|
|
|
4 |
|
0.2 |
% |
Money market accounts |
|
|
28,859 |
|
|
|
21 |
|
|
|
0.3 |
% |
|
|
22,274 |
|
|
|
21 |
|
|
0.4 |
% |
|
|
17,618 |
|
|
|
21 |
|
0.5 |
% |
Certificates of deposit |
|
|
104,135 |
|
|
|
242 |
|
|
|
0.9 |
% |
|
|
76,127 |
|
|
|
236 |
|
|
1.2 |
% |
|
|
48,201 |
|
|
|
292 |
|
2.4 |
% |
Total deposits |
|
|
147,977 |
|
|
|
279 |
|
|
|
0.8 |
% |
|
|
112,226 |
|
|
|
271 |
|
|
1.0 |
% |
|
|
78,820 |
|
|
|
331 |
|
1.7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other borrowings |
|
|
1,437 |
|
|
|
2 |
|
|
|
0.6 |
% |
|
|
9,365 |
|
|
|
8 |
|
|
0.3 |
% |
|
|
82,016 |
|
|
|
73 |
|
0.4 |
% |
Total interest bearing liabilities |
|
|
149,414 |
|
|
|
281 |
|
|
|
0.8 |
% |
|
|
121,591 |
|
|
|
279 |
|
|
0.9 |
% |
|
|
160,836 |
|
|
|
404 |
|
1.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest bearing deposits |
|
|
127,590 |
|
|
|
|
|
|
|
107,342 |
|
|
|
|
|
|
|
106,735 |
|
|
|
|
|
Non-interest bearing liabilities |
|
|
16,315 |
|
|
|
|
|
|
|
13,076 |
|
|
|
|
|
|
|
5,411 |
|
|
|
|
|
Shareholders’ equity |
|
|
89,199 |
|
|
|
|
|
|
|
63,045 |
|
|
|
|
|
|
|
42,458 |
|
|
|
|
|
Total liabilities and shareholders’ equity |
|
$ |
382,518 |
|
|
|
|
|
|
$ |
305,054 |
|
|
|
|
|
|
$ |
315,440 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income and interest rate spread |
|
|
|
$ |
15,272 |
|
|
|
16.2 |
% |
|
|
|
$ |
13,470 |
|
|
17.8 |
% |
|
|
|
$ |
8,161 |
|
9.9 |
% |
Net interest margin |
|
|
|
|
|
|
16.6 |
% |
|
|
|
|
|
18.3 |
% |
|
|
|
|
|
10.4 |
% |
Ratio of average interest-earning assets to average interest-
bearing liabilities |
|
|
|
|
|
|
246.0 |
% |
|
|
|
|
|
242.1 |
% |
|
|
|
|
|
194.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: Average PPP
loans for the three months ended December 31, 2021, September 30,
2021 and December 31, 2020 were $1.5 million, $8.8 million and
$122.7 million, respectively. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FINWISE
BANCORPAVERAGE BALANCES, YIELDS, AND RATES –
YEAR-TO-DATE($s in thousands;
unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Years Ended |
|
For the Years Ended |
|
|
12/31/2021 |
|
12/31/2020 |
($s in thousands, annualized ratios) |
|
AverageBalance |
|
Interest |
|
AverageYield/Rate |
|
AverageBalance |
|
Interest |
|
AverageYield/Rate |
Interest earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing deposits with the Federal Reserve, non-U.S.
central banks and other banks |
|
$ |
55,960 |
|
|
|
61 |
|
|
|
0.1 |
% |
|
$ |
43,892 |
|
|
|
201 |
|
|
0.5 |
% |
Investment securities |
|
|
3,298 |
|
|
|
47 |
|
|
|
1.4 |
% |
|
|
1,622 |
|
|
|
34 |
|
|
2.1 |
% |
Loans held for sale |
|
|
59,524 |
|
|
|
22,461 |
|
|
|
37.7 |
% |
|
|
20,154 |
|
|
|
10,560 |
|
|
52.4 |
% |
Loans held for investment |
|
|
198,992 |
|
|
|
26,674 |
|
|
|
13.4 |
% |
|
|
187,314 |
|
|
|
18,711 |
|
|
10.0 |
% |
Total interest earning assets |
|
|
317,774 |
|
|
|
49,243 |
|
|
|
15.5 |
% |
|
|
252,982 |
|
|
|
29,506 |
|
|
11.7 |
% |
Less: allowance for loan losses |
|
|
(7,548 |
) |
|
|
|
|
|
|
(6,706 |
) |
|
|
|
|
Non-interest earning assets |
|
|
17,002 |
|
|
|
|
|
|
|
8,130 |
|
|
|
|
|
Total assets |
|
$ |
327,228 |
|
|
|
|
|
|
$ |
254,406 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest bearing liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
Demand |
|
$ |
6,060 |
|
|
$ |
53 |
|
|
|
0.9 |
% |
|
$ |
3,237 |
|
|
$ |
62 |
|
|
1.9 |
% |
Savings |
|
|
7,897 |
|
|
|
10 |
|
|
|
0.1 |
% |
|
|
6,234 |
|
|
|
16 |
|
|
0.3 |
% |
Money market accounts |
|
|
21,964 |
|
|
|
75 |
|
|
|
0.3 |
% |
|
|
16,327 |
|
|
|
104 |
|
|
0.6 |
% |
Certificates of deposit |
|
|
72,311 |
|
|
|
1,000 |
|
|
|
1.4 |
% |
|
|
57,496 |
|
|
|
1,401 |
|
|
2.4 |
% |
Total deposits |
|
|
108,232 |
|
|
|
1,138 |
|
|
|
1.1 |
% |
|
|
83,294 |
|
|
|
1,583 |
|
|
1.9 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Other borrowings |
|
|
36,363 |
|
|
|
127 |
|
|
|
0.3 |
% |
|
|
49,044 |
|
|
|
173 |
|
|
0.4 |
% |
Total interest bearing liabilities |
|
|
144,595 |
|
|
|
1,265 |
|
|
|
0.9 |
% |
|
|
132,338 |
|
|
|
1,756 |
|
|
1.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest bearing deposits |
|
|
107,481 |
|
|
|
|
|
|
|
80,537 |
|
|
|
|
|
Non-interest bearing liabilities |
|
|
11,392 |
|
|
|
|
|
|
|
3,941 |
|
|
|
|
|
Shareholders’ equity |
|
|
63,760 |
|
|
|
|
|
|
|
37,590 |
|
|
|
|
|
Total liabilities and shareholders’ equity |
|
$ |
327,228 |
|
|
|
|
|
|
$ |
254,406 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income and interest rate spread |
|
|
|
$ |
47,978 |
|
|
|
14.6 |
% |
|
|
|
$ |
27,750 |
|
|
10.3 |
% |
Net interest margin |
|
|
|
|
|
|
15.1 |
% |
|
|
|
|
|
11.0 |
% |
Ratio of average interest-earning assets to average interest-
bearing liabilities |
|
|
|
|
|
|
219.8 |
% |
|
|
|
|
|
191.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: Average PPP loans for the years ended December 31, 2021 and
December 31, 2020 were $36.6 million and $79.7 million,
respectively. |
|
FINWISE
BANCORPSELECTED HISTORICAL CONSOLIDATED FINANCIAL
AND OTHER DATA ($s in thousands, except per share
amounts; unaudited) |
|
|
|
|
|
|
|
|
|
As of and for the Three Months Ended |
($s in
thousands, except per share amounts, annualized ratios) |
|
12/31/2021 |
|
9/30/2021 |
|
12/31/2020 |
Selected Loan Metrics |
|
|
|
|
|
|
|
|
Amount of loans originated |
|
$ |
2,304,234 |
|
|
$ |
1,822,942 |
|
|
$ |
850,927 |
|
Selected Income Statement Data |
|
|
|
|
|
|
Interest
income |
|
$ |
15,553 |
|
|
$ |
13,749 |
|
|
$ |
8,565 |
|
Interest
expense |
|
|
281 |
|
|
|
279 |
|
|
|
404 |
|
Net interest
income |
|
|
15,272 |
|
|
|
13,470 |
|
|
|
8,161 |
|
Provision
for loan losses |
|
|
2,503 |
|
|
|
3,367 |
|
|
|
- |
|
Net interest
income after provision for loan losses |
|
|
12,769 |
|
|
|
10,103 |
|
|
|
8,161 |
|
Non-interest
income |
|
|
9,129 |
|
|
|
8,475 |
|
|
|
3,432 |
|
Non-interest
expense |
|
|
8,371 |
|
|
|
7,398 |
|
|
|
5,657 |
|
Provision
for income taxes |
|
|
3,416 |
|
|
|
2,738 |
|
|
|
1,320 |
|
Net
income |
|
|
10,111 |
|
|
|
8,442 |
|
|
|
4,616 |
|
Selected Balance Sheet Data |
|
|
|
|
|
|
Total
Assets |
|
$ |
380,214 |
|
|
$ |
338,316 |
|
|
$ |
317,515 |
|
Cash and
cash equivalents |
|
|
85,754 |
|
|
|
68,106 |
|
|
|
47,383 |
|
Investment
securities held-to-maturity, at cost |
|
|
11,423 |
|
|
|
4,414 |
|
|
|
1,809 |
|
Loans
receivable, net |
|
|
198,102 |
|
|
|
178,748 |
|
|
|
232,074 |
|
Strategic
Program loans held-for-sale, at lower of cost or fair value |
|
|
60,748 |
|
|
|
62,702 |
|
|
|
20,948 |
|
SBA
servicing asset, net |
|
|
3,938 |
|
|
|
4,368 |
|
|
|
2,415 |
|
Investment
in Business Funding Group, at fair value |
|
|
5,900 |
|
|
|
5,241 |
|
|
|
3,770 |
|
Deposits |
|
|
251,892 |
|
|
|
253,036 |
|
|
|
164,476 |
|
PPP
Liquidity Facility |
|
|
1,050 |
|
|
|
2,259 |
|
|
|
101,007 |
|
Total
shareholders' equity |
|
|
115,442 |
|
|
|
69,138 |
|
|
|
45,872 |
|
Tangible
shareholders’ equity (1) |
|
|
115,442 |
|
|
|
69,138 |
|
|
|
45,872 |
|
Share and Per Share Data |
|
|
|
|
|
|
Earnings per
share - basic |
|
$ |
0.95 |
|
|
$ |
0.97 |
|
|
$ |
0.53 |
|
Earnings per
share - diluted |
|
$ |
0.90 |
|
|
$ |
0.90 |
|
|
$ |
0.53 |
|
Book value
per share |
|
$ |
9.04 |
|
|
$ |
7.91 |
|
|
$ |
5.30 |
|
Tangible
book value per share |
|
$ |
9.04 |
|
|
$ |
7.91 |
|
|
$ |
5.30 |
|
Weighted avg
outstanding shares - basic |
|
|
10,169,005 |
|
|
|
8,255,953 |
|
|
|
8,035,778 |
|
Weighted avg
outstanding shares - diluted |
|
|
10,818,984 |
|
|
|
8,847,606 |
|
|
|
8,081,470 |
|
Shares
outstanding at end of period |
|
|
12,772,010 |
|
|
|
8,746,110 |
|
|
|
8,660,334 |
|
Asset Quality Ratios |
|
|
|
|
|
|
Nonperforming loans to total loans |
|
|
0.2 |
% |
|
|
0.3 |
% |
|
|
0.3 |
% |
Net charge
offs to average loans |
|
|
3.2 |
% |
|
|
1.6 |
% |
|
|
1.2 |
% |
Allowance
for loan losses to loans held for investment |
|
|
4.8 |
% |
|
|
5.2 |
% |
|
|
2.6 |
% |
Allowance
for loan losses to total loans |
|
|
3.7 |
% |
|
|
3.9 |
% |
|
|
2.4 |
% |
Allowance
for loan losses to total loans (less PPP loans) |
|
|
3.7 |
% |
|
|
3.9 |
% |
|
|
4.0 |
% |
Capital Ratios |
|
|
|
|
|
|
Total
shareholders' equity to total assets |
|
|
30.4 |
% |
|
|
20.4 |
% |
|
|
14.4 |
% |
Tangible
shareholders' equity to tangible assets |
|
|
30.4 |
% |
|
|
20.4 |
% |
|
|
14.4 |
% |
Leverage
Ratio (Bank under CBLR) |
|
|
17.7 |
% |
|
|
19.5 |
% |
|
|
16.6 |
% |
|
|
|
|
|
|
|
(1) Tangible
shareholders’ equity is defined as total shareholders’ equity less
goodwill and other intangible assets. The most directly comparable
GAAP financial measure is total shareholder’s equity. We had no
goodwill or other intangible assets as of any of the dates
indicated. We have not considered loan servicing rights as an
intangible asset for purposes of this calculation. As a result,
tangible shareholders’ equity is the same as total shareholders’
equity as of each of the dates indicated. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP to Non-GAAP
Financial Measures |
|
|
|
|
|
|
|
Efficiency ratio |
|
|
|
|
|
|
|
|
For Three Months Ended |
($s in
thousands, annualized ratios) |
|
12/31/2021 |
|
9/30/2021 |
|
12/31/2020 |
Non-interest
expense |
|
$ |
8,371 |
|
|
$ |
7,398 |
|
|
$ |
5,657 |
|
Net interest
income |
|
$ |
15,272 |
|
|
$ |
13,470 |
|
|
$ |
8,161 |
|
Total
non-interest income |
|
|
9,129 |
|
|
|
8,475 |
|
|
|
3,432 |
|
Adjusted operating revenue |
|
$ |
24,401 |
|
|
$ |
21,945 |
|
|
$ |
11,593 |
|
Efficiency
ratio |
|
|
34.3 |
% |
|
|
33.7 |
% |
|
|
48.8 |
% |
|
|
|
|
|
|
|
Allowance for loan losses to total loans (less PPP
Loans) |
|
|
|
|
|
|
|
|
As of |
|
|
12/31/2021 |
|
9/30/2021 |
|
12/31/2020 |
($s in
thousands) |
|
|
|
|
|
|
Allowance
for loan losses |
|
$ |
9,855 |
|
|
$ |
9,640 |
|
|
$ |
6,199 |
|
Total
Loans |
|
|
265,788 |
|
|
|
249,214 |
|
|
|
261,777 |
|
PPP
Loans |
|
|
1,091 |
|
|
|
2,303 |
|
|
|
107,145 |
|
Total Loans
less PPP Loans |
|
$ |
264,697 |
|
|
$ |
246,911 |
|
|
$ |
154,632 |
|
Allowance
for loan losses to total loans (less PPP Loans) |
|
|
3.7 |
% |
|
|
3.9 |
% |
|
|
4.0 |
% |
|
|
|
|
|
|
|
Total nonperforming assets and troubled debt restructurings
to total assets (less PPP loans) |
|
|
|
|
|
As of |
|
|
12/31/2021 |
|
9/30/2021 |
|
12/31/2020 |
($s in
thousands) |
|
|
|
|
|
|
Total
Assets |
|
$ |
380,214 |
|
|
$ |
338,316 |
|
|
$ |
317,515 |
|
PPP
Loans |
|
|
1,091 |
|
|
|
2,303 |
|
|
|
107,145 |
|
Total Assets
less PPP Loans |
|
$ |
379,123 |
|
|
$ |
336,013 |
|
|
$ |
210,370 |
|
Total
nonperforming assets and troubled debt restructurings |
|
$ |
763 |
|
|
$ |
864 |
|
|
$ |
1,701 |
|
Total
nonperforming assets and troubled debt restructurings to total
assets (less PPP loans) |
|
|
0.2 |
% |
|
|
0.3 |
% |
|
|
0.8 |
% |
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