FinWise Bancorp(US:FINW)2023-07-30 03:17Financial Data and Key Metrics Changes - For Q2 2023, the company generated revenue of $21.2 million, with net income of $4.6 million, translating to diluted earnings per share of $0.35 and a return on average equity of 12.8% [11][28] - Net interest income grew 13% to $13.7 million compared to $12.1 million in the previous quarter, and increased 7.1% from $12.8 million in the same quarter last year [21][38] - The company's tangible book value per common share increased to $11.59 from $11.26 in the prior quarter [31] Business Line Data and Key Metrics Changes - Loan originations totaled $1.2 billion for the quarter, up from $0.9 billion in the previous quarter but down from $2.1 billion in the same quarter last year [60] - Non-interest income was $5.3 million, an increase from $4.5 million in the first quarter but a decrease from $8.4 million in the same quarter last year [39] - The efficiency ratio was 52.7%, slightly up from 52.5% in the previous quarter and 52% in the same quarter last year [32][63] Market Data and Key Metrics Changes - Average interest-bearing deposits increased to $219.1 million from $165.2 million in the first quarter and $127.2 million in the same quarter last year [20] - The net charge-off rate decreased to 3.4% compared to 4.5% in the first quarter and the same quarter last year [36] Company Strategy and Development Direction - The company continues to focus on diversifying revenue streams and investing in its team and infrastructure, including expanding its Banking-as-a-Service product line [14][35] - A definitive agreement was made to acquire an additional 10% of BFG's membership interests, which is part of the long-term strategy to increase equity ownership [15] Management's Comments on Operating Environment and Future Outlook - Management expressed a cautious outlook for loan originations for the remainder of 2023 due to tight capital markets and interest rate pressures [30] - The company remains committed to prudent credit underwriting and long-term growth strategies despite current macroeconomic challenges [34] Other Important Information - The company bought back 269,690 shares for approximately $2.2 million during the quarter [40] - The effective tax rate for the second quarter was 26.1%, consistent with the previous quarter [40] Q&A Session Summary Question: What drove the step down in SBA loan servicing fees this quarter? - The decrease was attributed to a couple of SBA loans paying off, affecting accruals and deferrals [77] Question: What is the outlook for operating expenses in the next couple of quarters? - The increase in compensation was due to higher performance bonuses, and the company plans to maintain consistent relationships [79] Question: How many shares were bought back this quarter and what is the remaining authorization? - The company purchased 269,690 shares for about $2.2 million, with plans to remain active in buybacks [80][81]