Company: NEWTP
Filing Date: 2025-08-08
Form Type: 10-Q
Source: 0001587987-25-000141
Chunk: 173

Company: NewtekOne, Inc.
Filing Date: 2025-08-08
Form: 10-Q
Item: Part I, Item 2
Chunk 173
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 was a large driver of the change described in the section below. The residual in the securitization (represented by the ownership certificate) was then valued resulting in a gain that was netted against the transaction costs. Refer to NOTE 3—SECURITIZATIONS AND VARIABLE INTEREST ENTITIES in the accompanying notes to the consolidated financial statements for additional information.

Net Gain (Loss) on Loans under the Fair Value Option

Net gain (loss) on loans accounted for under the fair value option for the six months ended June 30, 2025 and 2024 were as follows:

For the six months endedJune 30, 2025June 30, 2024ChangeSBA 7(a) Unguaranteed Loans$(7,346)$(5,679)$(1,667)SBA 7(a) Guaranteed Loans18,596 26 18,570 SBA 504 and Non-SBA Loans(4,934)5,557 (10,491)Net Gain (Loss) on Loans Accounted for Under the Fair Value Option$6,316 $(96)$6,412 

Net unrealized gain (loss) on loans accounted for under the fair value option relates to the guaranteed portions of SBA loans made which the Company sells into a secondary market, the unguaranteed portions of SBA loans made which the Company holds, SBA 504 loans that are held for sale, and ALP loans that are held for sale. This unrealized gain (loss) represents the fair value adjustment of loans. The amount of the unrealized gain (loss) is determined by the quantity of loans held for sale at quarter end, the change in secondary market pricing conditions, and the valuation of the loans that are not held for sale. 

During the six months ended June 30, 2025 and 2024, the Company recorded unrealized losses on SBA 7(a) unguaranteed loans accounted for under the fair value option as the portfolio paid down. During the six months ended June 30, 2025 and 2024, the Company recorded unrealized gains on SBA 7(a) guaranteed loans accounted for under the fair value option primarily due to holding guaranteed portions of SBA 7(a) loans for longer periods of time.

The $10.5 million decrease in unrealized gain (loss) on loans accounted for under the fair value option from SBA 504 and Non-SBA loans is primarily volume driven