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Core Insights - The bank maintained its position as a top 10 SBA 7(a) lender with nearly $580 million in funded originations in 2025 despite industry challenges [1] - The bank's initiatives in banking-as-a-service (BaaS) generated over $1.3 billion in new deposits during 2025, more than tripling the previous year [2] - A strategic sale of approximately $850 million in single-tenant lease financing loans to Blackstone strengthened the bank's capital and improved its rate-risk profile [3] - The company reported strong fourth-quarter results with a 21% increase in quarterly revenue and a 30% year-over-year growth in net interest income for 2025 [4] Financial Performance - Fourth-quarter net income was reported at $5.3 million, or $0.60 per diluted share, with adjusted net income of $5.6 million and adjusted EPS of $0.64 [13] - Adjusted total revenue for the fourth quarter was $42.1 million, reflecting a 21% increase from the same period in 2024 [14] - Non-interest income was $11.8 million, showing growth from the prior year, driven by fintech partnership fee revenue [15] Credit Metrics and Provisions - Credit issues are concentrated in SBA and franchise finance, leading to a higher provision outlook for 2026 of $50 million to $53 million [5][9] - Non-performing loans (NPLs) rose to $58.5 million, with an NPL-to-total loans ratio of 1.56% [16] - The allowance for credit losses (ACL) was 1.49% of total loans, with a small business lending ACL to unguaranteed balances at 7.34% [17] 2026 Outlook - The bank is guiding for net interest income of $30.3 million for 2026, representing a year-over-year increase of about 29% [19] - Loan growth is projected at 15% to 17%, with a net interest margin expected to reach 2.75% to 2.80% by the fourth quarter of 2026 [20] - Management expects gradual improvement in credit quality in the second half of 2026 as problem loans are resolved [9][12]

分组1 - First Internet Bancorp (INBK) reported quarterly earnings of $0.64 per share, exceeding the Zacks Consensus Estimate of $0.59 per share, and showing an increase from $0.41 per share a year ago, resulting in an earnings surprise of +9.40% [1] - The company posted revenues of $41.7 million for the quarter ended December 2025, which was 2.58% below the Zacks Consensus Estimate, and an increase from $39.49 million year-over-year [2] - First Internet has only surpassed consensus EPS estimates once in the last four quarters, indicating challenges in meeting revenue expectations [2] 分组2 - The stock has gained approximately 1.7% since the beginning of the year, underperforming compared to the S&P 500's gain of 1.9% [3] - The current consensus EPS estimate for the upcoming quarter is $0.86 on revenues of $43.4 million, and for the current fiscal year, it is $4.28 on revenues of $188.35 million [7] - The Zacks Industry Rank for Banks - Northeast is in the top 23% of over 250 Zacks industries, suggesting a favorable outlook for the industry [8]

Core Insights - The company reported a strong financial performance for 2025, with a 30% year-over-year growth in net interest income and a consistent expansion of net interest margin throughout the year [1] - The strategic sale of approximately $850 million in single tenant lease financing loans to Blackstone improved the company's capital position and reduced exposure to lower-yielding fixed-rate loans [1] - The banking as a service (BaaS) initiatives generated over $1.3 billion in new deposits for 2025, more than tripling the amount from the previous year [1] Financial Performance - The fourth quarter results showed a 21% increase in quarterly revenue compared to the prior year, with net income of $5.3 million or $0.60 per diluted share [20][21] - Adjusted total revenue for the quarter was $42.1 million, reflecting a 21% increase over 2024, while adjusted pre-provision net revenue totaled $17.9 million, up 66% year over year [20] - Net interest income for the fourth quarter was $30.3 million, up about 27% year over year, with net interest margin improving to 2.22% [21][22] Credit and Risk Management - The company faced credit challenges primarily in two portfolios: SBA and franchise finance, but overall credit quality remained solid across other lending verticals [7][9] - A provision for credit losses of $12 million was recognized in the fourth quarter, with nonperforming loans increasing to $58.5 million, primarily due to SBA guaranteed balances [24][25] - Enhanced risk management processes and prudent underwriting standards are yielding positive results, with expectations for gradual credit improvement in the second half of 2026 [7][9] Strategic Initiatives - The company is focusing on attracting higher credit quality borrowers, anticipating production of approximately $500 million for the year, reflecting a commitment to prudent risk management [12][13] - Investments in technology, including AI-driven solutions for document collection and predictive analytics for risk management, are expected to enhance operational efficiency and credit quality [18][19] - The BaaS platform continues to grow, supporting various fintech partners and demonstrating strong demand for sponsorship and program oversight capabilities [14][15] 2026 Outlook - The company expects loan growth in the range of 15% to 17% for 2026, with net interest margin projected to reach 2.75% to 2.8% [28] - Noninterest income is projected at $33 million to $35 million, reflecting lower SBA originations but offset by continued BaaS growth [29] - The provision for credit losses is estimated at $50 million to $53 million for the full year, with expectations for moderation as problem loans are resolved [30]

Financial Data and Key Metrics Changes - The company reported a quarterly revenue increase of 21% year-over-year, with net interest income growing by 30% year-over-year [4][20] - Adjusted total revenue for the fourth quarter was $42.1 million, reflecting a 21% increase over the same period in 2024 [20] - Net income for the fourth quarter was $5.3 million, or $0.60 per diluted share, with adjusted net income at $5.6 million, or $0.64 per diluted share [20][21] Business Line Data and Key Metrics Changes - The banking-as-a-service (BaaS) initiatives generated over $1.3 billion in new deposits for 2025, more than tripling the amount from the prior year [6] - The SBA business maintained its position as a top 10 SBA 7(a) lender with nearly $580 million in funded originations during 2025 [7] - The company processed over $165 billion in payments volume, an increase of over 225% from 2024 [6] Market Data and Key Metrics Changes - Total loans as of December 31, 2025, were $3.7 billion, an increase of $143 million or 4% compared to the linked quarter [25] - Total deposits as of December 31, 2025, were $4.8 billion, representing a decrease of $76 million, or 2%, compared to September 30, 2025 [25] Company Strategy and Development Direction - The company is focusing on a digital-first banking model, emphasizing operational efficiency and disciplined expense management [4][10] - A strategic sale of approximately $850 million in single-tenant lease financing loans was completed to strengthen capital position and enhance rate risk profile [6] - The company plans to prioritize credit quality over volume in its SBA production, anticipating a more measured approach in 2026 [12][13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to deliver strong financial performance while building long-term shareholder value through disciplined execution of strategic priorities [10][30] - The company expects continued loan growth in the range of 15%-17% for 2026, driven by strong pipelines across commercial lending verticals [27] - A higher provision for credit losses is anticipated for 2026 to address problem loans, with expectations for gradual credit improvement in the second half of the year [9][29] Other Important Information - The company recognized a provision for credit losses of $12 million in the fourth quarter, with non-performing loans increasing to $58.5 million [23][24] - The company executed a share buyback program, purchasing 27,998 shares at an average price of $18.64 per share [8] Q&A Session Summary Question: What is the expected impact of SBA loans on the balance sheet? - Management indicated that they expect to retain a greater percentage of guaranteed originations on the balance sheet, priced at prime plus 1.5 [41] Question: What are the expectations for deposit repricing? - Management expects continued decreases in deposit costs throughout the year, particularly benefiting from maturing CDs [40] Question: What is the outlook for net charge-offs and provisions? - Management expects that about half of the provision for credit losses will be related to charge-offs, with expectations for elevated levels in the first half of the year [60][61]

Financial Data and Key Metrics Changes - The company reported a quarterly revenue increase of 21% year-over-year, with net interest income growing by 30% year-over-year [4][20] - Adjusted net income for the fourth quarter was $5.6 million, translating to adjusted earnings per share of $0.64, reflecting strong operational execution [20] - Net interest margin improved to 2.22%, up 55 basis points year-over-year, driven by higher loan yields and declining deposit costs [21][22] Business Line Data and Key Metrics Changes - The banking-as-a-service (BaaS) initiatives generated over $1.3 billion in new deposits for 2025, more than tripling from the previous year [6] - The SBA business maintained its position as a top 10 SBA 7(a) lender with nearly $580 million in funded originations during 2025 [7] - Payments volume processed exceeded $165 billion, an increase of over 225% from 2024 [6] Market Data and Key Metrics Changes - Total loans as of December 31, 2025, were $3.7 billion, a 4% increase from the linked quarter but a 10% decrease from the previous year [24] - Total deposits were $4.8 billion, reflecting a 2% decrease compared to both the linked quarter and the previous year [25] Company Strategy and Development Direction - The company is focusing on a digital-first banking model, emphasizing operational efficiency and disciplined expense management [4][10] - Strategic initiatives include enhancing underwriting standards and improving servicing capabilities in the SBA business to drive long-term growth [7][13] - The company aims to achieve a 1% return on average assets and is actively managing its balance sheet to optimize asset mix [6][10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to deliver strong financial performance while building long-term shareholder value through disciplined execution of strategic priorities [10][29] - The company anticipates continued net interest margin expansion and robust fintech partnership growth, with credit stabilization expected in the second half of 2026 [10][28] Other Important Information - The company executed a share buyback program, purchasing 27,998 shares at an average price of $18.64 per share [8] - A higher provision for credit losses is expected in 2026 to address problem loans, with an estimated provision of $50 million to $53 million for the full year [28] Q&A Session Summary Question: What is the expected impact of SBA loans on the balance sheet and their yield? - Management indicated that they expect to retain a greater percentage of guaranteed originations on the balance sheet, priced at prime plus 1.5, which will positively impact loan yields [31][41] Question: What are the repricing opportunities on the funding side? - Management expects continued decreases in deposit costs, particularly in the first quarter, due to recent Federal Reserve rate cuts [37][39] Question: What is the outlook for criticized loans, particularly in the SBA and franchise finance buckets? - Criticized loans increased by approximately $16 million, predominantly in the SBA portfolio, with ongoing monitoring and proactive engagement with borrowers [42][44] Question: How does the company model interest reversals in relation to net interest income? - Management confirmed that interest reversals are factored into net interest income forecasts, with an estimated impact of $300,000 to $400,000 in the fourth quarter [54][56] Question: What is the expected tax rate for the EPS guidance? - The tax rate is expected to be around 7% to 8.5% in the first half of the year, ramping up to 10% to 12% in the second half as earnings improve [65][66]

Financial Data and Key Metrics Changes - The company reported a quarterly revenue increase of 21% year-over-year, with net interest income growing by 30% year-over-year [5][21] - Adjusted total revenue for Q4 2025 was $42.1 million, reflecting a 21% increase over Q4 2024 [21] - Net interest margin improved to 2.22%, up 55 basis points year-over-year [22] - Net income for Q4 2025 was $5.3 million, or $0.60 per diluted share, with adjusted net income of $5.6 million, or $0.64 per diluted share [21] Business Line Data and Key Metrics Changes - The banking-as-a-service (BaaS) initiatives generated over $1.3 billion in new deposits for 2025, more than tripling from the previous year [6] - The SBA business maintained a strong position with nearly $580 million in funded originations during 2025, despite industry challenges [7] - The company processed over $165 billion in payments volume, an increase of over 225% from 2024 [6] Market Data and Key Metrics Changes - Total loans as of December 31, 2025, were $3.7 billion, a 4% increase from the linked quarter but a 10% decrease from the previous year [26] - Total deposits as of December 31, 2025, were $4.8 billion, representing a 2% decrease compared to both September 30, 2025, and December 31, 2024 [26] Company Strategy and Development Direction - The company is focused on a digital-first banking model, emphasizing operational efficiency and disciplined expense management [5] - Strategic sale of approximately $850 million in single-tenant lease financing loans to Blackstone improved capital position and reduced exposure to lower-yielding assets [6] - The company aims to enhance credit quality by prioritizing higher credit quality borrowers in its SBA production, projecting a more measured production of approximately $500 million for 2026 [13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to deliver strong financial performance while building long-term shareholder value [11] - The company anticipates continued loan growth of 15%-17% in 2026, driven by strong pipelines across commercial lending verticals [27] - Management expects credit conditions to stabilize as problem loans are resolved and enhanced underwriting standards take effect [10] Other Important Information - The company recognized a provision for credit losses of $12 million in Q4 2025, primarily due to net charge-offs [25] - Non-performing loans increased to $58.5 million, with a ratio of 1.56% of total loans, primarily related to SBA guaranteed balances [25] Q&A Session Summary Question: What is the expected yield on SBA loans retained on the balance sheet? - Management indicated that they expect to hold an additional $94 million of guaranteed SBA loans on the balance sheet, priced at prime plus 1.5 [42] Question: What are the expectations for deposit repricing in the first half of the year? - Management expects continued decreases in deposit costs, particularly in the first quarter, due to maturing CDs and lower market rates [39][40] Question: What is the outlook for net charge-offs relative to the provision guidance? - Management indicated that approximately half of the provision guidance would be for charge-offs, with expectations for elevated levels in the first half of the year [60][61]

January 2026 Forward-Looking Statements & Non-GAAP Financial Measures This presentation contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including statements with respect to the financial condition, results of operations, trends in lending policies and loan programs, plans and prospective business partnerships, objectives, future performance and business of the Company. Forward-looking statements are generally ident ...

Financial Performance - Net income for Q4 2025 was $5.3 million, with diluted EPS of $0.60, while adjusted net income was $5.6 million and adjusted diluted EPS was $0.64[4]. - Net income for the three months ended December 31, 2025, was $5,289,000, a significant improvement from a net loss of $41,593,000 in the previous quarter[17]. - Earnings per share (diluted) increased to $0.60 for the three months ended December 31, 2025, compared to a loss of $4.76 in the prior quarter[17]. - Diluted earnings per share for 2026 are anticipated to be in the range of $2.35 to $2.45[13]. - Adjusted diluted earnings per share for Q4 2025 was $0.64, compared to a loss of $1.43 in Q3 2025[27]. Revenue and Income - Total revenue for Q4 2025 was $41.7 million, with adjusted total revenue increasing 21% year-over-year to $42.1 million[4]. - Total interest income for the three months ended December 31, 2025, was $78,054,000, a decrease from $84,388,000 in the previous quarter[19]. - Noninterest income for the three months ended December 31, 2025, was $11,375,000, a recovery from a loss of $24,647,000 in the previous quarter[19]. - Adjusted total revenue for the twelve months ended December 31, 2025, is $154,706,000, up from $129,989,000 in the previous year[25]. Assets and Loans - Total assets decreased to $5,571,647,000 as of December 31, 2025, from $5,639,174,000 at the end of the previous quarter[18]. - Total loan balances reached $3.7 billion, up $143.2 million, or 4%, from Q3 2025, driven by strong production in single tenant lease financing and construction[6]. - Total loans amounted to $3,746,728 thousand as of December 31, 2025, a decrease of 10.2% from $4,170,646 thousand in December 2024[22]. Deposits and Ratios - Total deposits were $4.8 billion, a slight decrease from $4.9 billion in Q3 2025, with a loans to deposits ratio of 77.4%[6]. - Total deposits decreased to $4,839,813,000 as of December 31, 2025, from $4,915,434,000 at the end of the previous quarter[18]. - Interest-bearing demand deposits increased to $1,120,850 thousand, representing 23.2% of total deposits as of December 31, 2025, up from 18.2% in December 2024[22]. Credit Losses and Provisions - Provision for credit losses for Q4 2025 was $12.0 million, down 66% from Q3 2025, with net charge-offs to average loans improving to 1.68%[6]. - Provision for credit losses increased significantly to $11,984,000 for the three months ended December 31, 2025, from $7,201,000 in the same period last year[19]. - The allowance for credit losses on loans was 1.49% as of December 31, 2025, compared to 1.66% in the previous quarter[17]. Margins and Returns - Net interest income rose 29% year-over-year to $30.3 million, with a fully-taxable equivalent net interest margin of 2.30%, an increase of 55 basis points from the prior year[4]. - The net interest margin increased to 2.22% for the three months ended December 31, 2025, up from 2.04% in the previous quarter[17]. - Return on average assets improved to 0.37% for the three months ended December 31, 2025, compared to a negative return of (2.71%) in the previous quarter[17]. - Return on average shareholders' equity was 5.79% for the three months ended December 31, 2025, compared to (42.11%) in the previous quarter[17]. Future Outlook - The company expects continued loan growth of 15% to 17% in 2026, with FTE net interest margin projected to expand to 2.75% to 2.80% by Q4 2026[13]. - The outlook for FTE net interest income in 2026 is between $155 million and $160 million, with noninterest income expected to be $33 million to $35 million[13]. - Operating expenses for 2026 are projected to be between $111 million and $112 million, with a provision for credit losses expected to be $50 million to $53 million[13].

Core Viewpoint - First Internet Bancorp has declared a quarterly cash dividend of $0.06 per common share, payable on January 15, 2026, to shareholders of record as of December 31, 2025 [1]. Group 1: Dividend Declaration - The Board of Directors has declared a quarterly cash dividend of $0.06 per common share [1]. - Future cash dividends will be at the discretion of the Board and will depend on various factors including the Company's financial condition and operational results [2]. Group 2: Company Overview - First Internet Bancorp is a bank holding company with assets totaling $5.6 billion as of September 30, 2025 [3]. - The Company's subsidiary, First Internet Bank, was established in 1999 and specializes in branchless banking services [3]. - First Internet Bank offers a range of services including consumer and small business deposits, SBA financing, and various types of loans [3]. - The common stock of First Internet Bancorp trades on the Nasdaq Global Select Market under the symbol "INBK" and is part of the Russell 2000® Index [3].