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Segment Financials
 12 Months Ended
Dec. 31, 2024
Segment Financials [Abstract]  
Segment Financials Note T—Segment Financials

The Company’s operations can be classified under three segments: fintech, specialty finance (three sub-segments), and corporate. The chief operating decision maker for these segments is the Chief Executive Officer. The fintech segment includes the deposit balances and non-interest income generated by prepaid, debit and other card accessed accounts, ACH proccessing and other payments related processing. It also includes loan balances and interest and non-interest income from credit products generated through payment relationships. Specialty finance includes: (i) REBL (real estate bridge lending) comprised primarily of apartment building rehabilitation loans (ii) institutional banking comprised primarily of security-backed lines of credit, cash value insurance policy-backed lines of credit and advisor financing and (iii) commercial loans comprised primarily of SBA loans and direct lease financing. It also includes deposits generated by those business lines. Corporate includes the Company’s investment securities, corporate overhead and expenses which have not been allocated to segments. Expenses not allocated include certain management, board oversight, administrative, legal, IT and technology infrastructure, human resouces, audit, regulatory and CRA, finance and accounting, marketing and other corporate expenses.

In the segment reporting below, a non-GAAP subtotal is shown, captioned “Income before non-interest expense allocation”. That subtotal presents income before consideration of allocated corporate expenses which might be fixed, semi-fixed or otherwise resist changes without regard to a particular line of business. It also reflects a market-based allocation of interest expense to financing segments which utilize funding from deposits generated by the fintech segment, which earns offsetting interest income. That allocation is shown in the “Interest allocation” line item. The rate utilized for the allocation corresponds to an estimated average of the three year FHLB rate. The fintech segment interest expense line item consists of interest expense actually incurred to generate its deposits, which is the Company’s actual cost of funds. That actual cost is allocated to the corporate segment which requires funding for the Company’s investment securities portfolio.

The more significant non-interest expense categories correspond to the Company’s consolidated statements of operations and include salaries and employee benefits, data processing and software expenses that are incurred directly by those segments. Expenses incurred by departments which provide support services to the segments also include those categories of expense and others which are allocated to segments based on estimated usage. Those support department allocations are reflected in the “Risk, financial crimes and compliance” and “Information technology and operations” line items. Other expenses not shown separately are monitored for purposes of expense management, but, unless atypically high, are ordinarily of lesser significance than the categories noted above.

For the fintech segment, deposit growth and the cost thereof and non-interest income growth, are factors in the decision making process and are respectively reported in the consolidated statemens of operations. For specialty finance, loan growth and related yields are factors in decision making. Comparative loan balance information measuring loan growth is presented in Note-E Loans. In addition to consideration of the above profitability and growth aspects of its operations, decision making is focused on the management of current and future potential risks. Such risks include, but are not limited to, credit, interest rate, liquidity, regulatory, and reputation. The loan committee provides support and oversight for credit risk, while the asset liability committee provides support and oversight over pricing, duration and liquidity. The risk committee provides further oversight over those and others including regulatory, reputation and other risks.

The following tables provide segment information for the periods indicated (dollars in thousands):

For the year ended December 31, 2024

Fintech

REBL

Institutional Banking

Commercial

Corporate

Total

Interest income

$

214 

$

207,062 

$

121,522 

$

124,490 

$

98,304 

$

551,592 

Interest allocation

261,484 

(98,064)

(69,942)

(69,960)

(23,518)

—

Interest expense

156,271 

—

3,962 

35 

15,083 

175,351 

Net interest income

105,427 

108,998 

47,618 

54,495 

59,703 

376,241 

Provision for credit losses(1)

19,619 

2,159 

763 

6,416 

(1,615)

27,342 

Non-interest income(1)

136,542 

3,264 

211 

5,541 

924 

146,482 

Direct non-interest expense

Salaries and employee benefits

15,577 

3,996 

9,659 

18,323 

84,042 

131,597 

Data processing expense

1,552 

169 

2,329 

7 

1,609 

5,666 

Software

486

104

2,962

1,777

12,584 

17,913 

Other

9,203 

4,719 

2,093 

7,698 

24,336 

48,049 

Income before non-interest expense allocations

195,532 

101,115 

30,023 

25,815 

(60,329)

292,156 

Non-interest expense allocations

Risk, financial crimes, and compliance

26,922 

2,177 

3,017 

4,921 

(37,037)

—

Information technology and operations

13,732 

723 

5,993 

7,444 

(27,892)

—

Other allocated expenses

15,814 

3,021 

6,574 

7,070 

(32,479)

—

Total non-interest expense allocations

56,468 

5,921 

15,584 

19,435 

(97,408)

—

Income before taxes

139,064 

95,194 

14,439 

6,380 

37,079 

292,156 

Income tax expense

35,516 

24,312 

3,688 

1,629 

9,471 

74,616 

Net income

$

103,548 

$

70,882 

$

10,751 

$

4,751 

$

27,608 

$

217,540 

(1) In 2024, lending agreements related to consumer fintech loans had certain charge-offs accounted for as freestanding credit enhancements which resulted in the Company recording a $19.6 million provision for credit losses and a correlated amount in non-interest income resulting in no impact to net income.

For the year ended December 31, 2023 as restated

Fintech

REBL

Institutional Banking

Commercial

Corporate

Total

Interest income

$

110 

$

194,419 

$

136,069 

$

102,596 

$

76,313 

$

509,507 

Interest allocation

264,820 

(97,941)

(84,807)

(68,487)

(13,585)

—

Interest expense

139,500 

507 

4,355 

—

11,093 

155,455 

Net interest income

125,430 

95,971 

46,907 

34,109 

51,635 

354,052 

Provision for credit losses

—

1,529 

(25)

7,222 

9,604 

18,330 

Non-interest income

99,376 

6,037 

760 

6,881 

(960)

112,094 

Direct non-interest expense

Salaries and employee benefits

13,666 

3,607 

9,680 

16,480 

77,622 

121,055 

Data processing expense

1,309 

153 

2,358 

5 

1,622 

5,447 

Software

552 

99 

2,951 

1,341 

12,406 

17,349 

Other

9,554 

3,693 

1,923 

8,310 

23,711 

47,191 

Income before non-interest expense allocations

199,725 

92,927 

30,780 

7,632 

(74,290)

256,774 

Non-interest expense allocations

Risk, financial crimes, and compliance

25,803 

1,221 

1,741 

2,473 

(31,238)

—

Information technology and operations

13,189 

805 

6,928 

6,488 

(27,410)

—

Other allocated expenses

11,598 

2,284 

5,895 

5,928 

(25,705)

—

Total non-interest expense allocations

50,590 

4,310 

14,564 

14,889 

(84,353)

—

Income before taxes

149,135 

88,617 

16,216 

(7,257)

10,063 

256,774 

Income tax expense

37,449 

22,252 

4,072 

(1,822)

2,527 

64,478 

Net income (loss)

$

111,686 

$

66,365 

$

12,144 

$

(5,435)

$

7,536 

$

192,296 

For the year ended December 31, 2022 as restated

Fintech

REBL

Institutional Banking

Commercial

Corporate

Total

Interest income

$

113 

$

108,934 

$

89,623 

$

74,834 

$

34,791 

$

308,295 

Interest allocation

205,174 

(73,050)

(82,414)

(49,326)

(384)

—

Interest expense

42,883 

1,004 

2,079 

—

13,488 

59,454 

Net interest income

162,404 

34,880 

5,130 

25,508 

20,919 

248,841 

Provision for credit losses

—

2,056 

659 

2,593 

1,800 

7,108 

Non-interest income

86,313 

11,494 

98 

5,200 

2,578 

105,683 

Direct non-interest expense

Salaries and employee benefits

11,553 

1,974 

8,953 

14,440 

68,448 

105,368 

Data processing expense

1,018 

157 

2,164 

5 

1,628 

4,972 

Software

555

99

2,600

1,233

11,724

16,211 

Other

9,463 

1,816 

2,182 

7,457 

22,033 

42,951 

Income before non-interest expense allocations

226,128 

40,272 

(11,330)

4,980 

(82,136)

177,914 

Non-interest expense allocations

Risk, financial crimes, and compliance

23,466 

1,035 

1,474 

2,089 

(28,064)

—

Information technology and operations

12,263 

797 

5,805 

5,247 

(24,112)

—

Other allocated expenses

11,212 

2,150 

4,902 

5,388 

(23,652)

—

Total non-interest expense allocations

46,941 

3,982 

12,181 

12,724 

(75,828)

—

Income (loss) before taxes

179,187 

36,290 

(23,511)

(7,744)

(6,308)

177,914 

Income tax expense (benefit)

48,042 

9,730 

(6,304)

(2,076)

(1,691)

47,701 

Net income (loss)

$

131,145 

$

26,560 

$

(17,207)

$

(5,668)

$

(4,617)

$

130,213 

December 31, 2024

Fintech

REBL

Institutional Banking

Commercial

Corporate

Total

Total assets

$

518,371 

$

2,300,817 

$

1,855,016 

$

1,676,241 

$

2,377,098 

$

8,727,543 

Total liabilities

$

6,885,456 

$

2,116 

$

434,283 

$

8,309 

$

607,596 

$

7,937,760 

December 31, 2023 as restated

Fintech

REBL

Institutional Banking

Commercial

Corporate

Total

Total assets

$

42,769 

$

2,208,030 

$

1,867,702 

$

1,468,654 

$

2,118,540 

$

7,705,695 

Total liabilities

$

6,412,911 

$

3,258 

$

186,503 

$

9,718 

$

286,024 

$

6,898,414