The following is a summary of the FinWise Bancorp (FINW) Q3 2024 Earnings Call Transcript:

Financial Performance:

• FinWise Bancorp reported a net income of $3.5 million, or $0.25 per diluted common share.

• Average loan balances rose to $492.9 million, reflecting solid growth in their commercial lease programs, SBA 7(a), and strategic program loans.

• Net interest income for Q3 was $14.8 million, up from $14.6 million in the previous quarter.

• The bank's net interest margin was 9.7% for the quarter.

• Noninterest income reached $6.1 million, driven mainly by increased origination fees from strategic programs.

Business Progress:

• Increased loan originations to $1.4 billion in Q3, up from an average of $1.1 billion over the past five quarters.

• Announced a new lending partnership with PowerPay addressing consumer loans for home improvement and elective health care.

• The bank's tangible book value per common share increased to $12.90 from $12.61 in the prior quarter.

• Ongoing buildout of strategic initiatives and organic growth facilitates.

• Focus on diversifying and expanding the loan portfolio, particularly with SBA 7(a) and commercial real estate loans.

Opportunities:

• Expansion of market share through new and existing strategic programs as well as through product cross-selling.

• Potentially reduced interest rates could favorably impact future SBA volumes and improve NPL metrics over time.

Risks:

• An expected deceleration in student loan originations from Earnest in Q4 could impact revenue.

• Potential increase in non-performing loans (NPLs) in the upcoming quarters due to sustained high rates, anticipated to affect net interest margin (NIM).

• Observing a negative trend in residual value of the investment in BFG, primarily linked to reduced SBA loan generation.

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