Newtek Business Services Corp
NASDAQ:NEWT
Newtek Business Services Corp
Newtek Business Services Corp. is a non-diversified closed-end management investment company. The company is headquartered in Boca Raton, Florida and currently employs 104 full-time employees. The firm's investment objective is to generate both current income and capital appreciation through loans originated by its business finance platform and its equity investments in certain portfolio companies that it controls. The company owns and controls certain portfolio companies under the Newtek brand that provides a range of business and financial solutions to small and medium-sized businesses (SMB). Its products and services include Business Lending, including the Small Business Administration (SBA), Electronic Payment Processing, Managed Technology Solutions, Data Backup, Technology Consulting, eCommerce, Accounts Receivable and Inventory Financing, personal and commercial Insurance Services, Web Services, Data Backup, Storage and Retrieval, and Payroll and Benefits Solutions to SMB accounts nationwide across all industries.
Revenue Growth: Revenue rose 15% year-over-year in Q2 2025 to $70.2 million, up from $61 million in Q2 2024.
EPS Guidance Maintained: Full-year 2024 EPS guidance remains at $2.10 to $2.50 per share, with the midpoint implying about 17% EPS growth.
Deposit Gains & Lower Costs: Business deposits grew by $50 million sequentially, mostly in DDA accounts, helping to lower the bank's cost of funds by 28 basis points to 3.71%.
Operating Efficiency: Efficiency ratio improved from 66.3% to 60.3% year-over-year, with operating expenses up just 4% while the balance sheet grew 37%.
Strong Loan Securitization: The alternative loan program (ALP) completed another securitization, with ALP loans valued at 14% yield and historically low 1% charge-off rates.
Credit Quality Trends: Losses at the runoff NSBF portfolio shrank significantly, and total charge-offs in the held-for-investment portfolio were $5.1 million, flat quarter-over-quarter.
Capital & Book Value: Tangible book value per share rose 3.7% sequentially and 21% year-over-year, while the majority of deposits remain insured.
Digital-First Strategy: Management emphasized their fully digital, tech-driven banking model and ongoing AI adoption as key differentiators.
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