Live Oak LOB Q4 2025 Earnings Call Transcript

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Thursday, Jan. 22, 2026 astatine 9:00 a.m. ET

• Executive Chairman — Chip Mahan

• Chief Executive Officer — Vijay Moesch

• Chief Financial Officer — Walt Phifer

• Chief Credit Officer — Michael Cairns

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Vijay Moesch: Great. Thanks, Greg. Good morning, everybody. Thanks for joining us. Let's get started connected descent four. 2025 was rather an absorbing year. And present astatine Live Oak, I'm really, truly arrogant of the mode we navigated done those absorbing times. Macro uncertainty persisted passim the year. Whether it was Doge oregon tariffs oregon uncertain system and yet 3 complaint decreases from the Fed precocious successful the year. We proceed to navigate done a tiny concern recognition rhythm and our indebtedness portfolio showed continued recognition stabilization implicit the people of the year. We importantly improved our operating processes and controls. We successfully executed connected our archetypal preferred offering.

And we finished the twelvemonth nicely with immoderate extracurricular task gains from our ventures portfolio. And yet adjacent with that engaged and perchance distracting backdrop, we produced immoderate fantabulous results arsenic you tin spot connected descent five. A fewer of the biggest highlights were grounds indebtedness production, 17% indebtedness growth, 27% halfway PPNR growth, 17% gross growth, and 13% tangible publication worth growth, successful summation to accelerating our momentum successful our cardinal maturation initiatives of Live Oak Express and checking. I'm peculiarly arrogant of this two-year presumption of our accumulation connected descent six. 57% maturation successful indebtedness accumulation crossed some our tiny concern and commercialized groups and importantly, beardown pipelines heading into 2026.

And arsenic arrogant arsenic I americium of those accumulation results, what matters astir is however you construe that into profitable operating leverage. And you tin spot connected descent 7 that those results are simply outstanding. With adjusted PPNR of 27% implicit 2024 and adjusted EPS up 49%. New lawsuit acquisition and maturation similar this doesn't conscionable hap by accident. Our radical and however we present fantabulous lawsuit work marque the difference. Our extremity is to proceed this momentum and present net outcomes that are much accordant and sustainable implicit time. While recognition has been apical of caput for america and for investors implicit the past year, position is ever important.

And connected descent eight, you tin spot our recognition trends implicit 10 years comparative to each different SBA lenders. And portion default rates had moved higher implicit the past 2 years, arsenic PPP and stimulus tailwinds person burned off, and rates roseate rapidly, Live Oak's show has consistently been good up of peers. Thankfully, we cognize tiny businesses and are large recognition managers. We're hopeful that these trends commencement to mean backmost towards the semipermanent inclination lines sooner alternatively than later. Finally, we proceed extending our lawsuit merchandise offerings with checking and tiny dollar SBA indebtedness capabilities. Both of these efforts launched successful aboriginal 2024.