XML 26 R12.htm IDEA: XBRL DOCUMENT v3.26.1
Loans
 6 Months Ended
Jun. 30, 2026
Receivables [Abstract]  
Loans Loans
The Company’s loan portfolios consist of the following:
June 30, 2026December 31, 2025
Loans held for sale at fair value$1,773,052 $1,762,396 
Loans held for investment at fair value2,085,066 473,314 
Total loans at fair value3,858,118 2,235,710 
Loans and leases held for investment at amortized cost, net2,993,252 3,997,069 
Total loans and leases$6,851,370 $6,232,779 

For loans held at fair value, see “Note 5. Fair Value Measurements” for the assumptions used in the Company’s fair value model.

Loans and Leases Held for Investment at Amortized Cost, Net

The Company defines its loans and leases HFI portfolio segments as (i) consumer and (ii) commercial. The following table presents the components of each portfolio segment by class of financing receivable:
June 30, 2026December 31, 2025
Unsecured consumer
$2,207,014 $3,191,430 
Residential mortgages147,460 151,073 
Secured consumer190,778 261,045 
Total consumer loans held for investment at amortized cost
2,545,252 3,603,548 
Equipment finance(1)
33,249 39,757 
Commercial real estate(2)(3)
460,203 472,489 
Commercial and industrial147,441 157,018 
Total commercial loans and leases held for investment at amortized cost
640,893 669,264 
Total loans and leases held for investment at amortized cost(4)
3,186,145 4,272,812 
Allowance for loan and lease losses(192,893)(275,743)
Loans and leases held for investment at amortized cost, net
$2,993,252 $3,997,069 
(1)    Comprised of sales-type leases for equipment. See “Note 16. Leases” for additional information.
(2)    Includes $279.6 million and $286.8 million in loans originated through the Small Business Administration (SBA) as of June 30, 2026 and December 31, 2025, respectively.
(3)    As of both June 30, 2026 and December 31, 2025, the Commercial Real Estate (CRE) office loan balance was under $35 million.
(4)    Accrued interest receivable is excluded from the amortized cost basis of loans and leases HFI and is reported within “Other assets” on the Balance Sheet. Net accrued interest receivable related to loans and leases HFI at amortized cost was $13.4 million and $17.9 million as of June 30, 2026 and December 31, 2025, respectively.
The following table presents the components of the allowance for loan and lease losses (ALLL):
June 30, 2026December 31, 2025
Gross allowance for loan and lease losses(1)
$227,500 $312,667 
Recovery asset value(2)
(34,607)(36,924)
Allowance for loan and lease losses$192,893 $275,743 
(1)    Represents the allowance for future estimated net charge-offs on existing portfolio balances.
(2)    Represents the negative allowance for expected recoveries of amounts previously charged-off.

June 30, 2026ConsumerCommercialTotal
Loans and leases held for investment at amortized cost
$2,545,252 $640,893 $3,186,145 
Allowance for loan and lease losses$176,727 $16,166 $192,893 
Allowance ratio(1)
6.9 %2.5 %6.1 %
Gross allowance for loan and lease losses$211,334 $16,166 $227,500 
Gross allowance ratio(1)
8.3 %2.5 %7.1 %
December 31, 2025ConsumerCommercialTotal
Loans and leases held for investment at amortized cost
$3,603,548 $669,264 $4,272,812 
Allowance for loan and lease losses
$258,811 $16,932 $275,743 
Allowance ratio(1)
7.2 %2.5 %6.5 %
Gross allowance for loan and lease losses
$295,735 $16,932 $312,667 
Gross allowance ratio(1)
8.2 %2.5 %7.3 %
(1)    Calculated as ALLL or gross ALLL, where applicable, to the corresponding portfolio segment balance of loans and leases HFI at amortized cost.
The activity in the ACL by portfolio segment was as follows:
Three Months Ended June 30,
20262025
ConsumerCommercialTotalConsumerCommercialTotal
Allowance for loan and lease losses:
Beginning of period
$221,196 $16,501 $237,697 $227,608 $16,585 $244,193 
Credit loss (benefit) expense
(10,486)(399)(10,885)41,133 (537)40,596 
Charge-offs
(46,395)(32)(46,427)(48,956)(898)(49,854)
Recoveries12,412 96 12,508 17,648 406 18,054 
End of period
$176,727 $16,166 $192,893 $237,433 $15,556 $252,989 
Reserve for unfunded lending commitments:
Beginning of period
$— $830 $830 $— $1,629 $1,629 
Credit loss benefit— (197)(197)— (44)(44)
End of period(1)
$— $633 $633 $— $1,585 $1,585 
Six Months Ended June 30,
20262025
ConsumerCommercialTotalConsumerCommercialTotal
Allowance for loan and lease losses:
Beginning of period
$258,811 $16,932 $275,743 $212,598 $24,136 $236,734 
Credit loss (benefit) expense
(9,085)(954)(10,039)97,081 (103)96,978 
Charge-offs
(99,039)(158)(99,197)(107,300)(9,130)(116,430)
Recoveries26,040 346 26,386 35,054 653 35,707 
End of period
$176,727 $16,166 $192,893 $237,433 $15,556 $252,989 
Reserve for unfunded lending commitments:
Beginning of period
$— $1,009 $1,009 $— $1,183 $1,183 
Credit loss (benefit) expense— (376)(376)— 402 402 
End of period(1)
$— $633 $633 $— $1,585 $1,585 
(1)    Relates to $35.2 million and $103.4 million of unfunded commitments as of June 30, 2026 and 2025, respectively.
As a result of the Company’s election of the fair value option, all loan originations in the first half of 2026 were accounted for at fair value. See “Note 1. Summary of Significant Accounting Policies” for additional information. Accordingly, no originations subsequent to 2025 are presented in the tables below.

The following table presents charge-offs by origination year for the first half of 2026:
Gross Charge-Offs by Origination Year
2025202420232022PriorTotal
Unsecured consumer(1)
$40,631 $28,086 $13,687 $12,900 $2,270 $97,574 
Residential mortgages— — — — — — 
Secured consumer461 214 413 312 65 1,465 
Total consumer loans held for investment at amortized cost
41,092 28,300 14,100 13,212 2,335 99,039 
Equipment finance— — — — — — 
Commercial real estate— — — — — — 
Commercial and industrial— — 32 126 — 158 
Total commercial loans and leases held for investment at amortized cost
— — 32 126 — 158 
Total loans and leases held for investment at amortized cost
$41,092 $28,300 $14,132 $13,338 $2,335 $99,197 
(1)    Unsecured consumer loans are generally charged-off when a borrower is contractually 120 days past due.
Consumer Lending Credit Quality Indicators

The Company evaluates the credit quality of its consumer loan portfolio based on the aging status of the loan and by payment activity. Loan delinquency reporting is based upon borrower payment activity relative to the contractual terms of the loan. The following tables present the classes of financing receivables within the consumer portfolio segment by credit quality indicator based on delinquency status and origination year:
June 30, 2026 Term Loans and Leases by Origination Year
2025202420232022PriorTotal
Unsecured consumer
Current $1,285,108 $501,367 $201,392 $163,284 $11,819 $2,162,970 
30-59 days past due 7,453 4,833 2,130 1,802 340 16,558 
60-89 days past due 6,663 3,628 1,664 1,617 246 13,818 
90 or more days past due 6,145 3,607 1,686 1,522 312 13,272 
Total unsecured consumer(1)
1,305,369 513,435 206,872 168,225 12,717 2,206,618 
Residential mortgages
Current — — — 39,964 106,534 146,498 
30-59 days past due — — — — — — 
60-89 days past due — — — — — — 
90 or more days past due — — — — 962 962 
Total residential mortgages — — — 39,964 107,496 147,460 
Secured consumer
Current103,550 34,012 29,314 16,854 3,999 187,729 
30-59 days past due871 246 413 543 126 2,199 
60-89 days past due308 119 133 121 20 701 
90 or more days past due61 — 22 44 22 149 
Total secured consumer104,790 34,377 29,882 17,562 4,167 190,778 
Total consumer loans held for investment at amortized cost
$1,410,159 $547,812 $236,754 $225,751 $124,380 $2,544,856 
(1)    Excludes basis adjustment for loans previously designated in fair value hedges under the portfolio layer method. As of June 30, 2026, the remaining unamortized basis adjustment totaled $0.4 million and represents an increase to the amortized cost of the previously hedged loans. See “Note 7. Derivative Instruments and Hedging Activities” for additional information.
December 31, 2025 Term Loans and Leases by Origination Year
20252024202320222021PriorTotal
Unsecured consumer
Current $1,741,108 $740,483 $326,147 $283,513 $39,605 $— $3,130,856 
30-59 days past due 9,084 5,680 3,533 3,591 603 — 22,491 
60-89 days past due 6,500 5,447 2,887 3,051 665 — 18,550 
90 or more days past due 4,862 6,049 3,105 3,223 697 — 17,936 
Total unsecured consumer(1)
1,761,554 757,659 335,672 293,378 41,570 — 3,189,833 
Residential mortgages
Current — — — 40,931 50,129 59,039 150,099 
30-59 days past due — — — — — — — 
60-89 days past due — — — — — 888 888 
90 or more days past due — — — — — 86 86 
Total residential mortgages — — — 40,931 50,129 60,013 151,073 
Secured consumer
Current134,255 47,453 42,332 26,961 3,769 2,278 257,048 
30-59 days past due778 261 816 941 210 — 3,006 
60-89 days past due131 128 109 177 51 — 596 
90 or more days past due78 31 133 153 — — 395 
Total secured consumer135,242 47,873 43,390 28,232 4,030 2,278 261,045 
Total consumer loans held for investment at amortized cost
$1,896,796 $805,532 $379,062 $362,541 $95,729 $62,291 $3,601,951 
(1)    Excludes cumulative basis adjustment for loans designated in fair value hedges under the portfolio layer method. As of December 31, 2025, the basis adjustment totaled $1.6 million and represents an increase to the amortized cost of the hedged loans. See “Note 7. Derivative Instruments and Hedging Activities” for additional information.

Commercial Lending Credit Quality Indicators

The Company evaluates the credit quality of its commercial loan portfolio based on regulatory risk ratings. The Company categorizes loans and leases into risk ratings based on relevant information about the quality and realizable value of collateral, if any, and the ability of obligors to service their debts, such as current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. The Company analyzes loans and leases individually by classifying the loans and leases based on their associated credit risk and performs this analysis whenever credit is extended, renewed or modified, or when an observable event occurs indicating a potential decline in credit quality, and no less than annually for large balance loans. Risk rating classifications consist of the following:

Pass – Loans and leases that the Company believes will fully repay in accordance with the contractual loan terms.

Special Mention – Loans and leases with a potential weakness that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or the Company’s credit position at some future date.

Substandard – Loans and leases that are inadequately protected by the current sound worth and paying capacity of the obligor or of the collateral pledged, if any. Loans and leases so classified have a well-defined weakness or weaknesses that jeopardize the repayment and liquidation of the debt. They are characterized by the distinct possibility that the Company will sustain some loss if the deficiencies are not corrected. Normal payment from the borrower is in jeopardy, although loss of principal, while still possible, is not imminent.
Doubtful – Loans and leases that have all the weaknesses inherent in those classified as Substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently known facts, conditions, and values, highly questionable and improbable.

Loss – Loans and leases that are considered uncollectible and of little value.

The following tables present the classes of financing receivables within the commercial portfolio segment by risk rating and origination year:
June 30, 2026 Term Loans and Leases by Origination Year
2025202420232022PriorTotal
Guaranteed Amount(1)
Equipment finance
Pass $— $— $— $18,817 $8,961 $27,778 $— 
Special mention— — — 2,016 33 2,049 — 
Substandard — — — — 2,728 2,728 — 
Doubtful — — — 694 — 694 — 
Loss— — — — — — — 
Total equipment finance— — — 21,527 11,722 33,249 — 
Commercial real estate
Pass 96,288 35,495 63,273 92,421 147,568 435,045 29,645 
Special mention— 520 — 453 5,967 6,940 709 
Substandard — — — 422 15,980 16,402 3,834 
Doubtful — — — — 60 60 — 
Loss— — — 1,121 635 1,756 1,536 
Total commercial real estate96,288 36,015 63,273 94,417 170,210 460,203 35,724 
Commercial and industrial
Pass 23,977 26,420 13,198 12,056 25,422 101,073 68,584 
Special mention— — — 5,876 — 5,876 4,499 
Substandard — 2,635 9,175 11,238 6,872 29,920 20,677 
Doubtful — — — 2,880 1,443 4,323 3,444 
Loss— 751 1,783 3,715 — 6,249 6,249 
Total commercial and industrial23,977 29,806 24,156 35,765 33,737 147,441 103,453 
Total commercial loans and leases held for investment at amortized cost
$120,265 $65,821 $87,429 $151,709 $215,669 $640,893 $139,177 
(1)    Represents loan balances guaranteed by the SBA.
December 31, 2025 Term Loans and Leases by Origination Year
20252024202320222021PriorTotal
Guaranteed Amount(1)
Equipment finance
Pass $— $— $— $21,283 $1,990 $9,762 $33,035 $— 
Special mention— — — 2,587 227 — 2,814 — 
Substandard — — — — 3,212 — 3,212 — 
Doubtful — — — 696 — — 696 — 
Loss— — — — — — — — 
Total equipment finance— — — 24,566 5,429 9,762 39,757 — 
Commercial real estate
Pass 95,736 36,356 63,750 94,771 32,452 121,231 444,296 30,959 
Special mention— — — — — 6,088 6,088 — 
Substandard — — — 428 8,433 11,370 20,231 7,005 
Doubtful — — — — — 61 61 — 
Loss— — — 1,121 271 421 1,813 1,543 
Total commercial real estate95,736 36,356 63,750 96,320 41,156 139,171 472,489 39,507 
Commercial and industrial
Pass 21,987 28,942 16,580 18,108 19,441 7,879 112,937 75,216 
Special mention— — — 8,535 2,959 67 11,561 9,264 
Substandard — 1,438 8,275 5,153 3,126 3,010 21,002 13,790 
Doubtful — — — 3,456 1,348 511 5,315 4,353 
Loss— 751 1,766 3,686 — — 6,203 6,203 
Total commercial and industrial21,987 31,131 26,621 38,938 26,874 11,467 157,018 108,826 
Total commercial loans and leases held for investment at amortized cost
$117,723 $67,487 $90,371 $159,824 $73,459 $160,400 $669,264 $148,333 
(1)    Represents loan balances guaranteed by the SBA.

The following tables present loans and leases HFI at amortized cost within the commercial portfolio segment by delinquency status:
June 30, 2026
Current
30-59
Days		60-89
Days		90 or More
Days
Total
Equipment finance$29,827 $— $— $3,422 $33,249 
Commercial real estate452,065 1,765 — 6,373 460,203 
Commercial and industrial
118,763 2,560 2,888 23,230 147,441 
Total commercial loans and leases held for investment at amortized cost
$600,655 $4,325 $2,888 $33,025 $640,893 
December 31, 2025
Current
30-59
Days		60-89
Days		90 or More
Days
Total
Equipment finance$35,973 $696 $— $3,088 $39,757 
Commercial real estate461,307 — — 11,182 472,489 
Commercial and industrial
133,526 1,540 1,878 20,074 157,018 
Total commercial loans and leases held for investment at amortized cost
$630,806 $2,236 $1,878 $34,344 $669,264 
Loan Modifications

The Company has loan modification programs to assist borrowers experiencing financial difficulty and to mitigate losses and maximize collections for loans serviced by the Company. The table below presents the amortized cost of loans that were modified during the periods presented, by modification type:
Three Months Ended June 30,Six Months Ended June 30,
2026202520262025
Short-term payment reduction
$5,829 $6,892 $10,835 $12,686 
Permanent loan modification
1,384 1,764 3,007 3,286 
Debt settlement
2,373 2,859 2,383 2,903 
Total loan modifications – unsecured consumer loans
$9,586 $11,515 $16,225 $18,875 
% of unsecured consumer loans at amortized cost as of period end
0.4 %0.3 %0.7 %0.6 %

The Company expanded its digital channels to enable borrowers experiencing financial difficulty to qualify for a short-term payment reduction modification program. Under this program, borrowers may receive a temporary payment reduction for three months. If the borrower meets the temporary payment reduction requirements during the first three-month term, they may qualify for a payment reduction for an additional three months. Receiving an additional three months of payment reduction is considered an other-than-insignificant payment delay and becomes a short-term payment reduction modification. The short-term payment reduction modification results in a term extension of four to nine months compared to the original maturity date of the loan and does not include any principal or interest forgiveness. At the time of receiving a payment reduction, a delinquent loan resets to current status. However, if a borrower fails to comply with the modified terms, the delinquency status returns to the original contractual terms of the loan. Borrowers who were in their first three months of temporary payment reduction had a total of $9.9 million of loan balances at amortized cost outstanding as of June 30, 2026, and may subsequently be eligible for a short-term payment reduction modification.

Permanent loan modifications include both a reduction in contractual interest rates and an extension to the contractual maturity date of up to twelve months and do not include any principal forgiveness. To qualify for this modification, borrowers must meet the Company’s debt-to-income ratio requirements. During the second quarter and first half of 2026, the weighted-average interest rate reduction under this program was approximately 8.8% for both periods. During the second quarter and first half of 2025, the weighted-average interest rate reduction under this program was approximately 8.0% and 8.1%, respectively. The weighted-average maturity date extension was approximately twelve months for all periods.

Debt settlement modifications, which include engaging with debt settlement companies, reduce the principal and interest amounts owed by borrowers. The Company typically charges-off such loans within a few months following the modification, as payments under the modified agreement are less than the original contractual amounts.
The following table presents the delinquency status of the amortized cost of loan modifications as of the periods presented below that were modified during the preceding twelve months:
June 30, 2026June 30, 2025
Short-term Payment ReductionPermanent Loan ModificationDebt SettlementShort-term Payment ReductionPermanent Loan ModificationDebt Settlement
Unsecured consumer loans
Current$14,475 $5,244 $7 $17,743 $5,433 $— 
30-59 days1,191 180 10 1,372 135 — 
60-89 days840 143 225 1,240 242 535 
90 or more days575 64 2,145 1,074 153 2,374 
Total loan modifications$17,081 $5,631 $2,387 $21,429 $5,963 $2,909 

A modified loan is generally charged-off in the event of a borrower defaulting at 120 days past due. The table below presents the total amount of charge-offs during the period for loan modifications that were entered into within the preceding twelve months of charge-off:
Three Months Ended June 30,Six Months Ended June 30,
2026202520262025
Short-term payment reduction
$1,944 $2,132 $3,790 $4,718 
Permanent loan modification
228 381 667 903 
Debt settlement
7,343 8,829 16,011 22,165 
Total loan modifications – unsecured consumer loans
$9,515 $11,342 $20,468 $27,786 

Nonaccrual Assets

Nonaccrual loans and leases are those for which accrual of interest has been suspended. Loans and leases are generally placed on nonaccrual status when contractually past due 90 days or more, or earlier if management believes that the probability of collection does not warrant further accrual.

Certain loans on nonaccrual status may be considered collateral-dependent loans if the borrower is experiencing financial difficulty and repayment of the loan is expected to be substantially through sale of the collateral. Such loans are secured by various types of collateral, including real estate, auto and equipment, among others. Expected credit losses for the Company’s collateral-dependent loans are calculated as the difference between the amortized cost basis and the fair value of the underlying collateral less costs to sell, if applicable. The fair value of the underlying collateral is generally based on third-party appraisals, which are updated on a case-by-case basis.
The following table presents nonaccrual loans and leases HFI at amortized cost:
June 30, 2026December 31, 2025
Nonaccrual
Nonaccrual with no related ACL(1)
Nonaccrual
Nonaccrual with no related ACL(1)
Unsecured consumer
$13,272 $— $17,936 $— 
Residential mortgages1,230 1,230 431 431 
Secured consumer149 — 395 — 
Total nonaccrual consumer loans held for investment at amortized cost
14,651 1,230 18,762 431 
Equipment finance3,422 — 3,088 — 
Commercial real estate6,809 1,857 11,253 5,799 
Commercial and industrial30,437 10,997 27,329 10,137 
Total nonaccrual commercial loans and leases held for investment at amortized cost(2)
40,668 12,854 41,670 15,936 
Total nonaccrual loans and leases held for investment at amortized cost
$55,319 $14,084 $60,432 $16,367 
(1)    Subset of total nonaccrual loans and leases HFI at amortized cost.
(2)    Includes $28.3 million and $29.7 million in loan balances guaranteed by the SBA as of June 30, 2026 and December 31, 2025, respectively.

June 30, 2026December 31, 2025
Nonaccrual
Nonaccrual Ratios(1)
Nonaccrual
Nonaccrual Ratios(1)
Total nonaccrual consumer loans held for investment at amortized cost
$14,651 0.6 %$18,762 0.5 %
Total nonaccrual commercial loans and leases held for investment at amortized cost
40,668 6.3 %41,670 6.2 %
Total nonaccrual loans and leases held for investment at amortized cost
$55,319 1.7 %$60,432 1.4 %
(1)    Calculated as the ratio of nonaccrual loans and leases to loans and leases HFI at amortized cost.