Company: NEWTP
Filing Date: 2025-11-07
Form Type: 10-Q
Source: 0001628280-25-050582
Chunk: 184

Company: NewtekOne, Inc.
Filing Date: 2025-11-07
Form: 10-Q
Item: Part I, Item 2
Chunk 184
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1, 2024.

6    On September 16, 2024, the Company completed a public offering of $75.0 million aggregate principal amount of 8.625% notes due 2029. The Notes will mature on October 15, 2029. The Notes bear interest at a rate of 8.625% per year, payable quarterly on January 15, April 15, July 15, and October 15 each year, commencing on January 15, 2025.

7    On March 19, 2025, the Company completed an exempt offering of $30.0 million aggregate principal amount of notes due 2030. The Notes will mature on April 1, 2030. The Notes bear interest at a rate of 8.375% per year, payable semiannually on April 1 and October 1 each year, commencing on October 1, 2025.

The increase in interest expense period over period is primarily due to the Company’s continued growth in deposits that increased interest expense by $3.6 million. In addition, there was additional interest expense on the 2027, 2029 8.625% Notes and 2030 Notes of $1.0 million, $1.4 million and $0.7 million, respectively and an increase in interest expense on bank and FHLB borrowings of $1.5 million. The increase was partially offset by a reduction in Notes payable - Securitization Trusts of $2.1 million, and the 2025 8.125% Notes of $1.1 million.

86

Provision for Credit Losses

The provision for loan and lease credit losses represents the amount necessary to be charged against the current period’s earnings to maintain the ACL on loans at a level that the Company believes is appropriate in relation to the estimated losses inherent in the loan portfolio.

For the three months ended September 30, 2025 and 2024, there was a provision for loan credit losses of $7.7 million and $6.9 million, respectively. The increase was due to an increase in loans held for investment at amortized cost, specifically SBA 7(a) loans, as well as a sequential build of the provision year over year.

Net Interest Income and Margin

Average Balances and Yields. The following table presents information regarding average balances for assets and liabilities, the total dollar amounts of interest income and dividends from average interest