Group 1 - The U.S. Small Business Administration (SBA) has focused on supporting manufacturers to rebuild U.S. production and strengthen domestic supply chains under the Trump administration [3] - The SBA created the Manufacturer's Access to Revolving Credit program, providing up to $5 million for working capital needs, with $3.5 million approved in the first two months [4] - The SBA developed a free tool to connect small businesses with U.S. manufacturers to facilitate onshoring and advanced a bill to double manufacturing loan limits to $10 million, which has passed the House [5] Group 2 - The SBA delivered record capital to small businesses in fiscal year 2025, guaranteeing 85,000 loans totaling $45 billion across various industries [6] - The SBA awarded $3.65 billion in government-backed loans to the manufacturing sector in fiscal year 2025, marking a 16.7% increase from the previous year [8] - A total of 4,456 loans valued at nearly $2.8 billion were provided to manufacturing borrowers through the SBA's 7(a) programs, along with 538 loans worth approximately $852 million via the 504 program [8]

Financial Data and Key Metrics Changes - NewtekOne reported earnings of $0.70 per basic share and $0.69 per diluted share, representing a 43% improvement over the previous year and quarter [11] - Net interest income increased by 36% compared to the same three-month period a year earlier [12] - Shareholders' equity rose to $296 million, a 19% increase [13] Business Line Data and Key Metrics Changes - The Alternative Loan Program (ALP) saw $269 million in loans for the year, with over $83 million in ALP loans for the 12 months [14] - The bank's core business deposits grew to $216 million, an increase of approximately $106 million from the previous year [27] Market Data and Key Metrics Changes - Newtek Bank achieved a Return on Average Assets (ROAA) of 6.3% and a Return on Tangible Common Equity (ROTCE) of 48% [28] - The efficiency ratio for Newtek Bank was reported at 42% [28] Company Strategy and Development Direction - NewtekOne aims to provide technology-enabled financial solutions to over 30 million independent business owners in the U.S. [9] - The company is transitioning from a Business Development Corporation to a financial holding company, focusing on depository solutions and real-time payments [3][10] - NewtekOne positions itself as a disruptor in the banking industry, similar to companies like Uber and Amazon [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to manage credit risk and maintain profitability despite potential increases in charge-offs [40][41] - The company anticipates a range of $2.10 to $2.50 in earnings per share for 2025, with a midpoint of $2.30 [31][36] - Management noted that the first quarter is typically the lowest quarter for earnings, with expectations for a ramp-up throughout the year [78] Other Important Information - NewtekOne's deposits are primarily in the insured category, with 75% to 80% of deposits insured [18] - The company has a significant amount of cash on hand, with over $300 million in deposits at the end of 2024 [58] Q&A Session Summary Question: Can you provide detail on the cadence of earnings throughout 2025? - Management noted that the first quarter is typically lower due to seasonal factors, with expectations for a ramp-up in subsequent quarters [78][80] Question: What drove the markup on loans accounted for under fair value options? - The markup was primarily driven by the fair value of ALP loans, which are securitized with high margins [84] Question: How are charge-off expectations modeled for the bank portfolio? - Charge-off expectations are based on historical patterns, with a projected increase from 1.5% to 2% for 2025 [92][94] Question: What are the drivers of expenses for 2025? - Management indicated plans for continued investment in resources to support growth, including accounting, compliance, and risk management [108]