Bancorp (TBBK) Increases Provision For Consumer Fintech Loan Credit Losses, Acknowledges Internal Control Weaknesses– Hagens Berman

Core Viewpoint - The Bancorp, Inc. has filed an amended annual report revealing previously omitted critical information, raising investor concerns amid ongoing asset quality issues and a securities class action lawsuit [1][2]. Financial Disclosures - The amended annual report on Form 10-K/A was filed on April 7, 2025, revising financial statements and disclosures from the original report filed on March 3, 2025 [2]. - The original report was deemed unreliable, and neither the former auditor Grant Thornton LLP nor the current auditor Crowe LLP provided final approval for their audit opinions [2][5]. Legal Issues - A securities class action lawsuit, Linden v. The Bancorp, Inc., was filed following the March 4 disclosure, alleging false and misleading statements by the company [1][3]. - The lawsuit seeks to represent investors who purchased Bancorp securities between January 25, 2024, and March 4, 2025 [2]. Asset Quality Concerns - Culper Research issued a report on March 21, 2024, accusing Bancorp of misrepresenting the quality of its real estate bridge loan portfolio and under-reserving for potential loan losses [3]. - The company reported disappointing Q3 2024 results, attributing a $1.5 million after-tax reduction in net income to a new CECL factor affecting REBL loans [4]. Internal Control and Financial Reporting - The amended report indicated that the provision for credit losses for consumer fintech loans was revised from$19.6 million to $30.7 million [4]. - The company acknowledged that its internal control over financial reporting was not effective, contradicting earlier statements [4][5]. Investigations and Whistleblower Information - Hagens Berman is investigating the claims against Bancorp, focusing on whether the financial statements accurately reflected the loan portfolios and adhered to accounting standards [6][7]. - Whistleblowers with non-public information regarding Bancorp are encouraged to assist in the investigation, with potential rewards under the SEC Whistleblower program [7].