Oct 29, 2026 earnings call — Strong loan growth and digital deposit expansion
Loan book grew 24% year-over-year and the digital deposit platform raised over $1 billion last quarter.
Revenue $0.1B (est $0.1B) · EPS $0.41 (est $0.34)
Key quotes
"Our loan book grew 24% year-over-year, up 9.5% this quarter alone."
"The second big theme was around our digital deposit platform, which raised over $1 billion in the last quarter, which represents a 24% increase from the prior quarter."
"Our efficiency ratio improved to 69.6%, down about 8 percentage points or 10% from the second quarter."
Analyst Q&A 7
deposit promotions plans
Q (Moshe Orenbuch · TD Cowen): Analyst asked how management plans to use promotions and how deposit betas might change with future rate hikes given loan growth plans.
A: Management deferred the detailed answer to another executive and passed the question to Aaron to address.
"Thanks, Moshe. I'm going to let Aaron take that one." — John Delaney (CEO·CHAIR)
deposit pricing and loan mix
Q (Aaron Juda · TD Cowen): Analyst asked about deposit promotions, future deposit pricing if rates rise, and whether other verticals will take over loan growth from health care.
A: They said they use promotions when acquisition costs are efficient and will stay disciplined afterward. If rates rise, blended cost on high-yield savings will increase; they will decide later whether to change base rate or use promotions. They expect loan growth across businesses and may modestly widen spreads on new originations while still meeting growth goals.
"I think the key is, Moshe, all of the businesses are seeing very attractive loan growth." — John Delaney (CEO·CHAIR)
Alliance platform integration
Q (Jared David Shaw · Barclays): Analyst asked whether Alliance production can increase, what that entails, and whether there will be expenses to scale it.
A: They moved Alliance into the lending businesses to integrate it more closely and plan to offer more loan products to BancAlliance. Management expects efficiencies from the integration and more distribution outlets for originations, possibly earning fees from partners.
"So we're hoping that this new integration more closely with the lending teams and the ability to offer all of the loan originations that bank -- that the Forbright had." — John Delaney (CEO·CHAIR)
margin expansion and spreads
Q (Ryan Nash · Goldman Sachs): Analyst asked how margin will expand given asset sensitivity, held deposit pricing after the hike, and whether widening spreads would cut growth and be accretive.
A: They said recent tightening of spreads appears to have stabilized and they can explore modestly wider spreads on new originations while still meeting loan growth. They also expect to pick up cost-of-funds improvement via the digital deposit platform and aim to improve NIM over time through higher loan-to-deposit and better funding spreads.
"And I would say less of it has happened than we would have thought. So I think all that gives us some confidence that what we would like to do in '27 is pick up a little bit of spread on new originations, and we'd actually like to continue to pick up a little bit of cost of funds relative to Fed funds by deploying some of these strategies." — John Delaney (CEO·CHAIR)
fee income outlook
Q (Nathan Race · Piper Sandler): Analyst asked how forward fee income will trend, given some noncore recurring items, and about comp costs and run-rate into next year.
A: They said FHA/HUD fee income is lumpy and higher rates can push some activity later, but they expect 2027 to be better than 2026. Solar servicing paydowns slow in higher rates, which extends fees, so the business mix hedges fee trends. Noncore items include gross-up pass-throughs that move revenue and expense dollar-for-dollar and can muddy metrics. Comp stepped up partly due to stronger earnings but remains behind forecast year-to-date.
"Higher long-term rates slows originations in HUD, but it also slows paydowns in the legacy book of loans that we service in solar servicing." — John Delaney (CEO·CHAIR)
virtual card trust and credit losses
Q (Terence McEvoy · Wells Fargo): Analyst asked whether virtual card controls and limits give enough customer trust, and whether the low quarter charge-off rate is sustainable.
A: They said yes: the virtual card has granular controls (limits, merchant codes, transaction counts) and a human-in-the-loop for early use, and those safeguards will extend to future agent features. On credit, they run the business to a 25 bps annualized charge-off forecast and said most credit issues were from legacy portfolios; overall portfolio credit remains strong.
"I would say the two things to keep in mind, I'll kind of walk through how this applies to the card and over time, how it will apply to other AI capabilities over time here, which is granular authorization controls and especially early on, keeping a Human-in-the-Loop, right?" — Donald F. Cole (CEO)
4Q NIM and 2027 expenses
Q (Anthony Elian · JPMorgan): Analyst asked if NIM should widen in 4Q given held deposit costs and loan repricing, and asked for details on expense trajectory for 2027 and 4Q.
A: They expect NIM in the fourth quarter to be wider. For 2027 expenses, ex gross-up pass-throughs they expect expenses largely flat, with efficiency savings and branch sale proceeds redeployed into the digital bank offsetting small new items so the net stays flat.
"And as we sit here today, we would expect our NIM in the fourth quarter to, in fact, be wider." — John Delaney (CEO·CHAIR)