FinWise Bancorp reported net income growth of 26% for full-year 2025, driven by multi-year investments translating into sustainable results. In the fourth quarter, the company originated $1.6 billion in loans, surpassing initial guidance of $1.4 billion, and reached $6.1 billion in originations for the year, a 22% increase over 2024. Chairman and CEO Kent Landvatter attributed this performance to robust production from established partners and ramping programs launched in recent years, noting that seasonal fluctuations—particularly in student lending—are expected but that the firm has achieved a higher, more sustainable level of quarterly originations.

FinWise ended the quarter with $118 million in credit-enhanced balances, topping both the $115 million outlook provided in the prior call and initial guidance of $50 million to $100 million. CFO Bob Wahlman linked this growth to higher net interest income—driven by a $76.5 million increase in credit-enhanced assets—and elevated non-interest income from credit enhancement fees. Non-interest expense rose in tandem, reflecting guarantee and servicing costs owed to strategic partners. Management emphasized that fintech partners maintain deposit collateral to cover charge-offs, solidifying this business as a core element of the bank’s lower-risk asset growth strategy.

CEO Jim Noone reported stable overall credit trends but noted that updated SBA servicing standards accelerated classification of certain loans as non-performing, resulting in quarterly net charge-offs of $6.7 million versus $3.1 million in the prior period. Of this total, $1.5 million related to the credit-enhanced portfolio—fully reimbursed by partner cash reserves—and $1.2 million stemmed from the new servicing criteria. Provision for loan losses rose to $17.7 million from $12.8 million, primarily due to credit-enhanced portfolio expansion and higher charge-offs. Non-performing loans increased modestly by less than $1 million to $43.7 million, with 55% government-guaranteed, outperforming prior guidance of $10 million to $12 million migrating to non-performing status.

Management provided baseline modeling for 2026 originations at $1.4 billion per quarter, normalizing for student lending seasonality, and applied a 5% annual growth assumption. Projected organic growth in credit-enhanced balances is $8 million to $10 million per month, with quarterly net charge-offs on traditional loans modeled at approximately $3.5 million. The company expects potential migration of up to $10 million in watchlist loans to non-performing in Q1 2026 and will use a 26% tax rate for modeling. FinWise reiterated confidence in its BIN sponsorship and payments strategy—though meaningful funding benefits may materialize in 2027—and outlined a disciplined approach to AI adoption across compliance, operations automation, cybersecurity and fraud detection, and regulatory support.