Live Oak Bancshares, Inc. Reports Second Quarter 2025 Results

WILMINGTON, N.C., July 23, 2025 (GLOBE NEWSWIRE) -- Live Oak Bancshares, Inc. (NYSE:LOB) ("Live Oak" or "the Company") today reported second quarter of 2025 net income attributable to the Company of $23.4 million, or $0.51 per diluted share.

Live Oak's performance in the quarter, compared to the first quarter of 2025, includes these notable items:

• Record second quarter production of $1.53 billion accompanied by strong deposit growth of $198.8 million, with total assets growing by 1.7% to $13.83 billion
• Net interest income increased 8.6% and net interest margin increased eight basis points from 3.20% to 3.28%
• 14.0% increase in revenue and 6.3% increase in noninterest expenses generated 29.4% increase in pre-provision net revenue¹
• Provision expense for credit losses of $23.3 million, a decrease of $5.7 million, driven by moderating credit trends, loan growth, and the current macroeconomic environment

"Live Oak Bank delivered an outstanding quarter in Q2, driven by excellent growth, healthy revenue, and lower provision expense," said Live Oak Chairman and CEO James S. (Chip) Mahan III. "We remain focused on supporting our nation's entrepreneurs as they continue to navigate a backdrop of uncertainty while also providing the service, technology and financial guidance they need to succeed."

Conference Call

Live Oak will host a conference call to discuss the Company's financial results and business outlook tomorrow, July 24, 2025, at 9:00 a.m. ET. The call will be accessible by telephone and webcast using Conference ID: 25229. A supplementary slide presentation will be posted to the website prior to the event, and a replay will be available for 12 months following the event. The conference call details are as follows:

Live Telephone Dial-In

U.S.: 800.549.8228

International: +1 646.564.2877

Pass Code: None Required

Live Webcast Log-In

Webcast Link: investor.liveoakbank.com

Registration: Name and Email Required

Multi-Factor Code: Provided After Registration

(1)	See accompanying GAAP to Non-GAAP Reconciliation.

Second Quarter 2025 Key Measures

(Dollars in thousands, except per share data)									Increase (Decrease)
	2Q 2025				1Q 2025				Dollars			Percent			2Q 2024
Total revenue(1)	$	143,747			$	126,113			$	17,634		14.0	%		$	125,479
Total noninterest expense		89,293				84,017				5,276		6.3				77,656
Income before taxes		31,202				13,132				18,070		137.6				36,058
Effective tax rate		25.0	%			26.4	%		n/a			n/a				25.2	%
Net income attributable to Live Oak Bancshares, Inc.	$	23,428			$	9,717			$	13,711		141.1	%		$	26,963
Diluted earnings per share		0.51				0.21				0.30		142.9				0.59
Loan and lease production:
Loans and leases originated	$	1,526,592			$	1,396,223			$	130,369		9.3	%		$	1,171,141
% Fully funded		39.7	%			46.0	%		n/a			n/a				38.2	%
Total loans and leases:	$	11,364,846			$	11,061,866			$	302,980		2.7	%		$	9,535,766
Total assets:		13,831,208				13,595,704				235,504		1.7				11,868,570
Total deposits:		12,594,790				12,395,945				198,845		1.6				10,707,031

(1)	Total revenue consists of net interest income and total noninterest income.

Important Note Regarding Forward-Looking Statements

Statements in this press release that are based on other than historical data or that express the Company's plans or expectations regarding future events or determinations are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. Statements based on historical data are not intended and should not be understood to indicate the Company's expectations regarding future events. Forward-looking statements provide current expectations or forecasts of future events or determinations. These forward-looking statements are not guarantees of future performance or determinations, nor should they be relied upon as representing management's views as of any subsequent date. Forward-looking statements involve significant risks and uncertainties, and actual results may differ materially from those presented, either expressed or implied, in this press release. Factors that could cause actual results to differ materially from those expressed in the forward-looking statements include changes in Small Business Administration ("SBA") rules, regulations or loan products, including the Section 7(a) program, changes in SBA standard operating procedures or changes in Live Oak Banking Company's status as an SBA Preferred Lender; changes in rules, regulations or procedures for other government loan programs, including those of the United States Department of Agriculture; the impacts of any pandemic or public health situation on trade (including supply chains and export levels), travel, employee productivity and other economic activities that may have a destabilizing and negative effect on financial markets, economic activity and customer behavior; adverse developments in the banking industry highlighted by high-profile bank failures and the potential impact of such developments on customer confidence, liquidity, and regulatory responses to these developments; a reduction in or the termination of the Company's ability to use the technology-based platform that is critical to the success of its business model, including a failure in or a breach of operational or security systems or those of its third-party service providers; risks relating to the material weakness we identified in our internal control over financial reporting; technological risks and developments, including cyber threats, attacks, or events; competition from other lenders; the Company's ability to attract and retain key personnel; market and economic conditions and the associated impact on the Company; operational, liquidity and credit risks associated with the Company's business; changes in political and economic conditions, including any prolonged U.S. government shutdown; the impact of heightened regulatory scrutiny of financial products and services and the Company's ability to comply with regulatory requirements and expectations; changes in tariffs and trade barriers, including potential changes in U.S. and international trade policies and the resulting impact on the Company and its customers; a deterioration of the credit rating for U.S. long-term sovereign debt, actions that the U.S. government may take to avoid exceeding the debt ceiling, and uncertainties surrounding the debt ceiling and the federal budget; adverse results, including related fees and expenses, from pending or future lawsuits, government investigations or private actions; and the other factors discussed in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission ("SEC") and available at the SEC's Internet site (http://www.sec.gov). Except as required by law, the Company specifically disclaims any obligation to update any factors or to publicly announce the result of revisions to any of the forward-looking statements included herein to reflect future events or developments.

About Live Oak Bancshares, Inc.

Live Oak Bancshares, Inc. (NYSE:LOB) is a financial holding company and the parent company of Live Oak Bank. Live Oak Bancshares and its subsidiaries partner with businesses that share a groundbreaking focus on service and technology to redefine banking. To learn more, visit www.liveoak.bank. 

Contacts:

Walter J. Phifer | CFO | Investor Relations | 910.202.6926

Claire Parker | Corporate Communications | Media Relations | 910.597.1592

Live Oak Bancshares, Inc.

Quarterly Statements of Income (unaudited)

(Dollars in thousands, except per share data)

	Three Months Ended																				2Q 2025 Change vs.
	2Q 2025				1Q 2025				4Q 2024				3Q 2024				2Q 2024				1Q 2025			2Q 2024
Interest income																					%			%
Loans and fees on loans	$	204,513			$	195,616			$	194,821			$	192,170			$	181,840			4.5			12.5
Investment securities, taxable		11,648				11,089				10,490				9,750				9,219			5.0			26.3
Other interest earning assets		8,123				6,400				7,257				7,016				7,389			26.9			9.9
Total interest income		224,284				213,105				212,568				208,936				198,448			5.2			13.0
Interest expense
Deposits		113,380				110,888				113,357				110,174				105,358			2.2			7.6
Borrowings		1,683				1,685				1,737				1,762				1,770			(0.1	)		(4.9	)
Total interest expense		115,063				112,573				115,094				111,936				107,128			2.2			7.4
Net interest income		109,221				100,532				97,474				97,000				91,320			8.6			19.6
Provision for credit losses		23,252				28,964				33,581				34,502				11,765			(19.7	)		97.6
Net interest income after provision for credit losses		85,969				71,568				63,893				62,498				79,555			20.1			8.1
Noninterest income
Loan servicing revenue		8,565				8,298				8,524				8,040				7,347			3.2			16.6
Loan servicing asset revaluation		(3,057	)			(4,728	)			(2,326	)			(4,207	)			(2,878	)		35.3			(6.2	)
Net gains on sales of loans		21,641				18,648				18,356				16,646				14,395			16.0			50.3
Net gain (loss) on loans accounted for under the fair value option		1,082				(1,034	)			195				2,255				172			204.6			529.1
Equity method investments (loss) income		(2,716	)			(2,239	)			(2,739	)			(1,393	)			(1,767	)		(21.3	)		(53.7	)
Equity security investments gains, net		1,004				20				12				909				161			4,920.0			523.6
Lease income		3,103				2,573				2,456				2,424				2,423			20.6			28.1
Management fee income		—				—				—				1,116				3,271			—			(100.0	)
Other noninterest income		4,904				4,043				6,115				7,142				11,035			21.3			(55.6	)
Total noninterest income		34,526				25,581				30,593				32,932				34,159			35.0			1.1
Noninterest expense
Salaries and employee benefits		49,137				48,008				45,214				44,524				46,255			2.4			6.2
Travel expense		2,576				2,795				2,628				2,344				2,328			(7.8	)		10.7
Professional services expense		2,874				3,024				2,797				3,287				3,061			(5.0	)		(6.1	)
Advertising and marketing expense		4,420				3,665				1,979				2,473				3,004			20.6			47.1
Occupancy expense		2,369				2,737				2,558				2,807				2,388			(13.4	)		(0.8	)
Technology expense		10,066				9,251				9,406				9,081				7,996			8.8			25.9
Equipment expense		3,685				3,745				3,769				3,472				3,511			(1.6	)		5.0
Other loan origination and maintenance expense		4,190				4,585				4,812				4,872				3,659			(8.6	)		14.5
Renewable energy tax credit investment impairment		270				—				1,172				115				170			100.0			58.8
FDIC insurance		3,545				3,551				3,053				1,933				2,649			(0.2	)		33.8
Other expense		6,161				2,656				3,869				2,681				2,635			132.0			133.8
Total noninterest expense		89,293				84,017				81,257				77,589				77,656			6.3			15.0
Income before taxes		31,202				13,132				13,229				17,841				36,058			137.6			(13.5	)
Income tax expense		7,815				3,464				3,386				4,816				9,095			125.6			(14.1	)
Net income		23,387				9,668				9,843				13,025				26,963			141.9			(13.3	)
Net loss attributable to non-controlling interest		41				49				57				—				—			(16.3	)		100.0
Net income attributable to Live Oak Bancshares, Inc.	$	23,428			$	9,717			$	9,900			$	13,025			$	26,963			141.1			(13.1	)
Earnings per share
Basic	$	0.51			$	0.21			$	0.22			$	0.28			$	0.60			142.9			(15.0	)
Diluted	$	0.51			$	0.21			$	0.22			$	0.28			$	0.59			142.9			(13.6	)
Weighted average shares outstanding
Basic		45,634,741				45,377,965				45,224,470				45,073,482				44,974,942
Diluted		45,795,608				45,754,499				46,157,979				45,953,947				45,525,082

Live Oak Bancshares, Inc.

Quarterly Balance Sheets (unaudited)

(Dollars in thousands)

	As of the quarter ended																				2Q 2025 Change vs.
	2Q 2025				1Q 2025				4Q 2024				3Q 2024				2Q 2024				1Q 2025			2Q 2024
Assets																					%			%
Cash and due from banks	$	662,755			$	744,263			$	608,800			$	666,585			$	615,449			(11.0	)		7.7
Certificates of deposit with other banks		250				250				250				250				250			—			—
Investment securities available-for-sale		1,325,206				1,312,680				1,248,203				1,233,466				1,151,195			1.0			15.1
Loans held for sale		350,791				367,955				346,002				359,977				363,632			(4.7	)		(3.5	)
Loans and leases held for investment(1)		11,014,055				10,693,911				10,233,374				9,831,891				9,172,134			3.0			20.1
Allowance for credit losses on loans and leases		(182,231	)			(190,184	)			(167,516	)			(168,737	)			(137,867	)		4.2			(32.2	)
Net loans and leases		10,831,824				10,503,727				10,065,858				9,663,154				9,034,267			3.1			19.9
Premises and equipment, net		246,493				259,113				264,059				267,032				267,864			(4.9	)		(8.0	)
Foreclosed assets		6,318				2,108				1,944				8,015				8,015			199.7			(21.2	)
Servicing assets		60,359				56,911				56,144				52,553				51,528			6.1			17.1
Other assets		347,212				348,697				352,120				356,314				376,370			(0.4	)		(7.7	)
Total assets	$	13,831,208			$	13,595,704			$	12,943,380			$	12,607,346			$	11,868,570			1.7			16.5
Liabilities and shareholders' equity
Liabilities
Deposits:
Noninterest-bearing	$	393,393			$	386,108			$	318,890			$	258,844			$	264,013			1.9			49.0
Interest-bearing		12,201,397				12,009,837				11,441,604				11,141,703				10,443,018			1.6			16.8
Total deposits		12,594,790				12,395,945				11,760,494				11,400,547				10,707,031			1.6			17.6
Borrowings		107,659				110,247				112,820				115,371				117,745			(2.3	)		(8.6	)
Other liabilities		61,494				58,065				66,570				83,672				82,745			5.9			(25.7	)
Total liabilities		12,763,943				12,564,257				11,939,884				11,599,590				10,907,521			1.6			17.0
Shareholders' equity
Preferred stock, no par value, 1,000,000 shares authorized, none issued or outstanding		—				—				—				—				—			—			—
Class A common stock (voting)		377,953				370,513				365,607				361,925				356,381			2.0			6.1
Class B common stock (non-voting)		—				—				—				—				—			—			—
Retained earnings		746,450				724,215				715,767				707,026				695,172			3.1			7.4
Accumulated other comprehensive loss		(61,514	)			(67,698	)			(82,344	)			(61,195	)			(90,504	)		9.1			32.0
Total shareholders' equity attributed to Live Oak Bancshares, Inc.		1,062,889				1,027,030				999,030				1,007,756				961,049			3.5			10.6
Non-controlling interest		4,376				4,417				4,466				—				—			(0.9	)		100.0
Total shareholders' equity		1,067,265				1,031,447				1,003,496				1,007,756				961,049			3.5			11.1
Total liabilities and shareholders' equity	$	13,831,208			$	13,595,704			$	12,943,380			$	12,607,346			$	11,868,570			1.7			16.5

(1)	Includes $303.8 million, $316.8 million, $328.7 million, $343.4 million and $363.0 million loans measured at fair value for the quarters ended June 30, 2025, March 31, 2025, December 31, 2024, September 30, 2024, and June 30, 2024, respectively.

Live Oak Bancshares, Inc.

Statements of Income (unaudited)

(Dollars in thousands, except per share data)

	Six Months Ended
	June 30, 2025				June 30, 2024
Interest income
Loans and fees on loans	$	400,129			$	357,850
Investment securities, taxable		22,737				18,173
Other interest earning assets		14,523				14,845
Total interest income		437,389				390,868
Interest expense
Deposits		224,268				207,356
Borrowings		3,368				2,081
Total interest expense		227,636				209,437
Net interest income		209,753				181,431
Provision for credit losses		52,216				28,129
Net interest income after provision for credit losses		157,537				153,302
Noninterest income
Loan servicing revenue		16,863				14,971
Loan servicing asset revaluation		(7,785	)			(5,622	)
Net gains on sales of loans		40,289				25,897
Net gain (loss) on loans accounted for under the fair value option		48				(47	)
Equity method investments (loss) income		(4,955	)			(6,789	)
Equity security investments gain (losses), net		1,024				(368	)
Lease income		5,676				4,876
Management fee income		—				6,542
Other noninterest income		8,947				20,796
Total noninterest income		60,107				60,256
Noninterest expense
Salaries and employee benefits		97,145				93,530
Travel expense		5,371				4,766
Professional services expense		5,898				4,939
Advertising and marketing expense		8,085				6,696
Occupancy expense		5,106				4,635
Technology expense		19,317				15,719
Equipment expense		7,430				6,585
Other loan origination and maintenance expense		8,775				7,570
Renewable energy tax credit investment impairment (recovery)		270				(757	)
FDIC insurance		7,096				5,849
Other expense		8,817				5,861
Total noninterest expense		173,310				155,393
Income before taxes		44,334				58,165
Income tax expense		11,279				3,616
Net income		33,055				54,549
Net loss attributable to non-controlling interest		90				—
Net income attributable to Live Oak Bancshares, Inc.	$	33,145			$	54,549
Earnings per share
Basic	$	0.72			$	1.22
Diluted	$	0.72			$	1.20
Weighted average shares outstanding
Basic		45,556,842				44,868,625
Diluted		45,825,543				45,583,146

Live Oak Bancshares, Inc.

Quarterly Selected Financial Data

(Dollars in thousands, except per share data)

	As of and for the three months ended
	2Q 2025				1Q 2025				4Q 2024				3Q 2024				2Q 2024
Income Statement Data
Net income attributable to Live Oak Bancshares, Inc.	$	23,428			$	9,717			$	9,900			$	13,025			$	26,963
Per Common Share
Net income, diluted	$	0.51			$	0.21			$	0.22			$	0.28			$	0.59
Dividends declared		0.03				0.03				0.03				0.03				0.03
Book value		23.36				22.62				22.12				22.32				21.35
Tangible book value (1)		23.29				22.55				22.05				22.24				21.28
Performance Ratios
Return on average assets (annualized)		0.68	%			0.30	%			0.31	%			0.43	%			0.93	%
Return on average equity (annualized)		8.85				3.78				3.85				5.21				11.39
Net interest margin		3.28				3.20				3.15				3.33				3.28
Efficiency ratio (1)		62.12				66.62				63.45				59.72				61.89
Noninterest income to total revenue		24.02				20.28				23.89				25.35				27.22
Selected Loan Metrics
Loans and leases originated	$	1,526,592			$	1,396,223			$	1,421,118			$	1,757,856			$	1,171,141
Outstanding balance of sold loans serviced		5,321,284				4,949,962				4,715,895				4,452,750				4,292,857
Asset Quality Ratios
Allowance for credit losses to loans and leases held for investment (3)		1.70	%			1.83	%			1.69	%			1.78	%			1.57	%
Net charge-offs (3)	$	31,445			$	6,774			$	33,566			$	1,710			$	8,253
Net charge-offs to average loans and leases held for investment (2) (3)		1.19	%			0.27	%			1.39	%			0.08	%			0.38	%
Nonperforming loans and leases at historical cost (3)
Unguaranteed	$	59,555			$	99,907			$	81,412			$	49,398			$	37,340
Guaranteed		336,777				322,993				222,885				166,177				122,752
Total		396,332				422,900				304,297				215,575				160,092
Unguaranteed nonperforming historical cost loans and leases, to loans and leases held for investment (3)		0.56	%			0.96	%			0.82	%			0.52	%			0.42	%
Nonperforming loans at fair value (4)
Unguaranteed	$	8,873			$	9,938			$	9,115			$	8,672			$	9,590
Guaranteed		60,453				58,100				54,873				49,822				51,570
Total		69,326				68,038				63,988				58,494				61,160
Unguaranteed nonperforming fair value loans to fair value loans held for investment (4)		2.92	%			3.14	%			2.77	%			2.53	%			2.64	%
Capital Ratios
Common equity tier 1 capital (to risk-weighted assets)		10.67	%			10.67	%			11.04	%			11.19	%			11.85	%
Tier 1 leverage capital (to average assets)		7.90				8.03				8.21				8.60				8.71

Notes to Quarterly Selected Financial Data

(1) See accompanying GAAP to Non-GAAP Reconciliation.

(2) Quarterly net charge-offs as a percentage of quarterly average loans and leases held for investment, annualized.

(3) Loans and leases at historical cost only (excludes loans measured at fair value).

(4) Loans accounted for under the fair value option only (excludes loans and leases carried at historical cost).

Live Oak Bancshares, Inc.

Quarterly Average Balances and Net Interest Margin

(Dollars in thousands)

	Three Months Ended June 30, 2025										Three Months Ended March 31, 2025
	Average Balance				Interest			Average Yield/Rate			Average Balance				Interest			Average Yield/Rate
Interest-earning assets:
Interest-earning balances in other banks	$	727,715			$	8,123		4.48	%		$	581,267			$	6,400		4.47	%
Investment securities		1,408,942				11,648		3.32				1,379,797				11,089		3.26
Loans held for sale		381,531				8,008		8.42				407,953				8,612		8.56
Loans and leases held for investment(1)		10,843,303				196,505		7.27				10,388,872				187,004		7.30
Total interest-earning assets		13,361,491				224,284		6.73				12,757,889				213,105		6.77
Less: Allowance for credit losses on loans and leases		(186,022	)									(165,320	)
Noninterest-earning assets		539,485										534,133
Total assets	$	13,714,954									$	13,126,702
Interest-bearing liabilities:
Interest-bearing checking	$	350,978			$	3,969		4.54	%		$	350,491			$	3,929		4.55	%
Savings		6,241,053				56,529		3.63				5,540,147				51,604		3.78
Money market accounts		128,757				93		0.29				127,908				120		0.38
Certificates of deposit		5,392,494				52,789		3.93				5,563,004				55,235		4.03
Total deposits		12,113,282				113,380		3.75				11,581,550				110,888		3.88
Borrowings		109,463				1,683		6.17				111,919				1,685		6.11
Total interest-bearing liabilities		12,222,745				115,063		3.78				11,693,469				112,573		3.90
Noninterest-bearing deposits		375,503										342,482
Noninterest-bearing liabilities		53,717										58,739
Shareholders' equity		1,058,572										1,027,547
Non-controlling interest		4,417										4,465
Total liabilities and shareholders' equity	$	13,714,954									$	13,126,702
Net interest income and interest rate spread					$	109,221		2.95	%						$	100,532		2.87	%
Net interest margin								3.28										3.20
Ratio of average interest-earning assets to average interest-bearing liabilities								109.32	%									109.10	%

(1)	Average loan and lease balances include non-accruing loans and leases.

Live Oak Bancshares, Inc.

GAAP to Non-GAAP Reconciliation

(Dollars in thousands)

	As of and for the three months ended
	2Q 2025				1Q 2025				4Q 2024				3Q 2024				2Q 2024
Total shareholders' equity	$	1,067,265			$	1,031,447			$	1,003,496			$	1,007,756			$	961,049
Less:
Goodwill		1,797				1,797				1,797				1,797				1,797
Other intangible assets		1,491				1,529				1,568				1,606				1,644
Tangible shareholders' equity (a)	$	1,063,977			$	1,028,121			$	1,000,131			$	1,004,353			$	957,608
Shares outstanding (c)		45,686,081				45,589,633				45,359,425				45,151,691				45,003,856
Total assets	$	13,831,208			$	13,595,704			$	12,943,380			$	12,607,346			$	11,868,570
Less:
Goodwill		1,797				1,797				1,797				1,797				1,797
Other intangible assets		1,491				1,529				1,568				1,606				1,644
Tangible assets (b)	$	13,827,920			$	13,592,378			$	12,940,015			$	12,603,943			$	11,865,129
Tangible shareholders' equity to tangible assets (a/b)		7.69	%			7.56	%			7.73	%			7.97	%			8.07	%
Tangible book value per share (a/c)	$	23.29			$	22.55			$	22.05			$	22.24			$	21.28
Efficiency ratio:
Noninterest expense (d)	$	89,293			$	84,017			$	81,257			$	77,589			$	77,656
Net interest income		109,221				100,532				97,474				97,000				91,320
Noninterest income		34,526				25,581				30,593				32,932				34,159
Total revenue (e)	$	143,747			$	126,113			$	128,067			$	129,932			$	125,479
Efficiency ratio (d/e)		62.12	%			66.62	%			63.45	%			59.72	%			61.89	%
Pre-provision net revenue (e-d)	$	54,454			$	42,096			$	46,810			$	52,343			$	47,823

This press release presents non-GAAP financial measures. The adjustments to reconcile from the non-GAAP financial measures to the applicable GAAP financial measure are included where applicable in financial results presented in accordance with GAAP. The Company considers these adjustments to be relevant to ongoing operating results. The Company believes that excluding the amounts associated with these adjustments to present the non-GAAP financial measures provides a meaningful base for period-to-period comparisons, which will assist regulators, investors, and analysts in analyzing the operating results or financial position of the Company. The non-GAAP financial measures are used by management to assess the performance of the Company's business for presentations of Company performance to investors, and for other reasons as may be requested by investors and analysts. The Company further believes that presenting the non-GAAP financial measures will permit investors and analysts to assess the performance of the Company on the same basis as that applied by management. Non-GAAP financial measures have inherent limitations, are not required to be uniformly applied, and are not audited. Although non-GAAP financial measures are frequently used by shareholders to evaluate a company, they have limitations as an analytical tool and should not be considered in isolation or as a substitute for analysis of results reported under GAAP.