EX-99.1 2 lob-20250423exx991.htm EX-99.1

Exhibit 99.1

Live Oak Bancshares, Inc. Reports First Quarter 2025 Results

WILMINGTON, NC, April 23, 2025 - Live Oak Bancshares, Inc. (NYSE: LOB) (“Live Oak” or “the Company”) today reported first quarter of 2025 net income attributable to the Company of $9.7 million, or $0.21 per diluted share.

Live Oak’s performance in the quarter compared to the fourth quarter of 2024, includes these notable items:

•Record first quarter production of $1.40 billion accompanied by strong deposit growth of $635.5 million, with total assets growing by 5.0% to $13.60 billion

•Net interest income increased 3.1% and net interest margin increased 5 basis points from 3.15% to 3.20%

•1.5% decline in revenue and 3.4% increase in noninterest expenses generated 10% decline in pre-provision net revenue1

•Provision expense for credit losses of $29.0 million, principally driven by loan growth amid a challenging macroeconomic environment, where elevated interest rates and inflationary pressures placed financial strain on some small business borrowers

•Two key initiatives saw positive momentum — non-interest bearing deposit growth and small dollar loan production

“Live Oak Bank demonstrated strong growth across our lending and deposit franchises in the first quarter, all while navigating the current small business credit cycle and a backdrop of economic uncertainty,” said Live Oak Chairman and CEO James S. (Chip) Mahan III. “We have an unwavering dedication to small business and staying close to our customers in these turbulent times remains paramount. Small business is the backbone of America, and we continue to support our nation’s entrepreneurs with the capital they need to create jobs, drive innovation, and serve their communities well.”

Conference Call

Live Oak will host a conference call to discuss the Company's financial results and business outlook tomorrow, April 24, 2025, at 9:00 a.m. ET. The call will be accessible by telephone and webcast using Conference ID: 75855. 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.

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First Quarter 2025 Key Measures

(Dollars in thousands, except per share data)															Increase (Decrease)
			1Q 2025						4Q 2024						Dollars						Percent						1Q 2024
Total revenue (1)			$	126,113					$	128,067					$	(1,954)					(1.5)		%				$	116,208
Total noninterest expense			84,017						81,257						2,760						3.4						77,737
Income before taxes			13,132						13,229						(97)						(0.7)						22,107
Effective tax rate			26.4		%				25.6		%				n/a						n/a						(24.8)		%
Net income attributable to Live Oak Bancshares, Inc.			$	9,717					$	9,900					$	(183)					(1.8)		%				$	27,586
Diluted earnings per share			0.21						0.22						(0.01)						(5)						0.60
Loan and lease production:
Loans and leases originated			$	1,396,223					$	1,421,118					$	(24,895)					(1.8)		%				$	805,129
% Fully funded			46.0		%				42.4		%				n/a						n/a						43.8		%
Total loans and leases:			$	11,061,866					$	10,579,376					$	482,490					4.6		%				$	9,223,310
Total assets:			13,595,704						12,943,380						652,324						5.0						11,505,569
Total deposits:			12,395,945						11,760,494						635,451						5.4						10,383,361

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

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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

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Live Oak Bancshares, Inc.

Quarterly Statements of Income (unaudited)

(Dollars in thousands, except per share data)

			Three Months Ended																														1Q 2025 Change vs.
			1Q 2025						4Q 2024						3Q 2024						2Q 2024						1Q 2024						4Q 2024						1Q 2024
Interest income																																	%						%
Loans and fees on loans			$	195,616					$	194,821					$	192,170					$	181,840					$	176,010					0.4						11.1
Investment securities, taxable			11,089						10,490						9,750						9,219						8,954						5.7						23.8
Other interest earning assets			6,400						7,257						7,016						7,389						7,456						(11.8)						(14.2)
Total interest income			213,105						212,568						208,936						198,448						192,420						0.3						10.7
Interest expense
Deposits			110,888						113,357						110,174						105,358						101,998						(2.2)						8.7
Borrowings			1,685						1,737						1,762						1,770						311						(3.0)						441.8
Total interest expense			112,573						115,094						111,936						107,128						102,309						(2.2)						10.0
Net interest income			100,532						97,474						97,000						91,320						90,111						3.1						11.6
Provision for loan and lease credit losses			28,964						33,581						34,502						11,765						16,364						(13.7)						77.0
Net interest income after provision for loan and lease credit losses			71,568						63,893						62,498						79,555						73,747						12.0						(3.0)
Noninterest income
Loan servicing revenue			8,298						8,524						8,040						7,347						7,624						(2.7)						8.8
Loan servicing asset revaluation			(4,728)						(2,326)						(4,207)						(2,878)						(2,744)						(103.3)						(72.3)
Net gains on sales of loans			18,648						18,356						16,646						14,395						11,502						1.6						62.1
Net (loss) gain on loans accounted for under the fair value option			(1,034)						195						2,255						172						(219)						(630.3)						(372.1)
Equity method investments (loss) income			(2,239)						(2,739)						(1,393)						(1,767)						(5,022)						18.3						55.4
Equity security investments (losses) gains, net			20						12						909						161						(529)						66.7						(103.8)
Lease income			2,573						2,456						2,424						2,423						2,453						4.8						4.9
Management fee income			—						—						1,116						3,271						3,271						—						(100.0)
Other noninterest income			4,043						6,115						7,142						11,035						9,761						(33.9)						(58.6)
Total noninterest income			25,581						30,593						32,932						34,159						26,097						(16.4)						(2.0)
Noninterest expense
Salaries and employee benefits			48,008						45,214						44,524						46,255						47,275						6.2						1.6
Travel expense			2,795						2,628						2,344						2,328						2,438						6.4						14.6
Professional services expense			3,024						2,797						3,287						3,061						1,878						8.1						61.0
Advertising and marketing expense			3,665						1,979						2,473						3,004						3,692						85.2						(0.7)
Occupancy expense			2,737						2,558						2,807						2,388						2,247						7.0						21.8
Technology expense			9,251						9,406						9,081						7,996						7,723						(1.6)						19.8
Equipment expense			3,745						3,769						3,472						3,511						3,074						(0.6)						21.8
Other loan origination and maintenance expense			4,585						4,812						4,872						3,659						3,911						(4.7)						17.2
Renewable energy tax credit investment (recovery) impairment			—						1,172						115						170						(927)						(100.0)						(100.0)
FDIC insurance			3,551						3,053						1,933						2,649						3,200						16.3						11.0
Other expense			2,656						3,869						2,681						2,635						3,226						(31.4)						(17.7)
Total noninterest expense			84,017						81,257						77,589						77,656						77,737						3.4						8.1
Income before taxes			13,132						13,229						17,841						36,058						22,107						(0.7)						(40.6)
Income tax expense			3,464						3,386						4,816						9,095						(5,479)						2.3						(163.2)
Net income			9,668						9,843						13,025						26,963						27,586						(1.8)						(65.0)
Net loss attributable to non-controlling interest			49						57						—						—						—						(14.0)						100.0
Net income attributable to Live Oak Bancshares, Inc.			$	9,717					$	9,900					$	13,025					$	26,963					$	27,586					(1.8)						(64.8)
Earnings per share
Basic			$	0.21					$	0.22					$	0.28					$	0.60					$	0.62					(4.5)						(66.1)
Diluted			$	0.21					$	0.22					$	0.28					$	0.59					$	0.60					(4.5)						(65.0)
Weighted average shares outstanding
Basic			45,377,965						45,224,470						45,073,482						44,974,942						44,762,308
Diluted			45,754,499						46,157,979						45,953,947						45,525,082						45,641,210

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Live Oak Bancshares, Inc.

Quarterly Balance Sheets (unaudited)

(Dollars in thousands)

			As of the quarter ended																														1Q 2025 Change vs.
			1Q 2025						4Q 2024						3Q 2024						2Q 2024						1Q 2024						4Q 2024						1Q 2024
Assets																																	%						%
Cash and due from banks			$	744,263					$	608,800					$	666,585					$	615,449					$	597,394					22.3						24.6
Certificates of deposit with other banks			250						250						250						250						250						—						—
Investment securities available-for-sale			1,312,680						1,248,203						1,233,466						1,151,195						1,120,622						5.2						17.1
Loans held for sale			367,955						346,002						359,977						363,632						310,749						6.3						18.4
Loans and leases held for investment (1)			10,693,911						10,233,374						9,831,891						9,172,134						8,912,561						4.5						20.0
Allowance for credit losses on loans and leases			(190,184)						(167,516)						(168,737)						(137,867)						(139,041)						(13.5)						(36.8)
Net loans and leases			10,503,727						10,065,858						9,663,154						9,034,267						8,773,520						4.4						19.7
Premises and equipment, net			259,113						264,059						267,032						267,864						258,071						(1.9)						0.4
Foreclosed assets			2,108						1,944						8,015						8,015						8,561						8.4						(75.4)
Servicing assets			56,911						56,144						52,553						51,528						49,343						1.4						15.3
Other assets			348,697						352,120						356,314						376,370						387,059						(1.0)						(9.9)
Total assets			$	13,595,704					$	12,943,380					$	12,607,346					$	11,868,570					$	11,505,569					5.0						18.2
Liabilities and shareholders’ equity
Liabilities
Deposits:
Noninterest-bearing			$	386,108					$	318,890					$	258,844					$	264,013					$	226,668					21.1						70.3
Interest-bearing			12,009,837						11,441,604						11,141,703						10,443,018						10,156,693						5.0						18.2
Total deposits			12,395,945						11,760,494						11,400,547						10,707,031						10,383,361						5.4						19.4
Borrowings			110,247						112,820						115,371						117,745						120,242						(2.3)						(8.3)
Other liabilities			58,065						66,570						83,672						82,745						74,248						(12.8)						(21.8)
Total liabilities			12,564,257						11,939,884						11,599,590						10,907,521						10,577,851						5.2						18.8
Shareholders’ equity
Preferred stock, no par value, 1,000,000 shares authorized, none issued or outstanding			—						—						—						—						—						—						—
Class A common stock (voting)			370,513						365,607						361,925						356,381						349,648						1.3						6.0
Class B common stock (non-voting)			—						—						—						—						—						—						—
Retained earnings			724,215						715,767						707,026						695,172						669,307						1.2						8.2
Accumulated other comprehensive loss			(67,698)						(82,344)						(61,195)						(90,504)						(91,237)						17.8						25.8
Total shareholders' equity attributed to Live Oak Bancshares, Inc.			1,027,030						999,030						1,007,756						961,049						927,718						2.8						10.7
Non-controlling interest			4,417						4,466						—						—						—						(1.1)						100.0
Total shareholders' equity			1,031,447						1,003,496						1,007,756						961,049						927,718						2.8						11.2
Total liabilities and shareholders’ equity			$	13,595,704					$	12,943,380					$	12,607,346					$	11,868,570					$	11,505,569					5.0						18.2

(1)Includes $316.8 million, $328.7 million, $343.4 million, $363.0 million and $379.2 million measured at fair value for the quarters ended March 31, 2025, December 31, 2024, September 30, 2024, June 30, 2024, and March 31, 2024 respectively.

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Live Oak Bancshares, Inc.

Quarterly Selected Financial Data

(Dollars in thousands, except per share data)

			As of and for the three months ended
			1Q 2025						4Q 2024						3Q 2024						2Q 2024						1Q 2024
Income Statement Data
Net income attributable to Live Oak Bancshares, Inc.			$	9,717					$	9,900					$	13,025					$	26,963					$	27,586
Per Common Share
Net income, diluted			$	0.21					$	0.22					$	0.28					$	0.59					$	0.60
Dividends declared			0.03						0.03						0.03						0.03						0.03
Book value			22.62						22.12						22.32						21.35						20.64
Tangible book value (1)			22.55						22.05						22.24						21.28						20.57
Performance Ratios
Return on average assets (annualized)			0.30		%				0.31		%				0.43		%				0.93		%				0.98		%
Return on average equity (annualized)			3.78						3.85						5.21						11.39						11.93
Net interest margin			3.20						3.15						3.33						3.28						3.33
Efficiency ratio (1)			66.62						63.45						59.72						61.89						66.89
Noninterest income to total revenue			20.28						23.89						25.35						27.22						22.46
Selected Loan Metrics
Loans and leases originated			$	1,396,223					$	1,421,118					$	1,757,856					$	1,171,141					$	805,129
Outstanding balance of sold loans serviced			4,949,962						4,715,895						4,452,750						4,292,857						4,329,097
Asset Quality Ratios
Allowance for credit losses to loans and leases held for investment (3)			1.83		%				1.69		%				1.78		%				1.57		%				1.63		%
Net charge-offs (3)			$	6,774					$	33,566					$	1,710					$	8,253					$	3,163
Net charge-offs to average loans and leases held for investment (2) (3)			0.27		%				1.39		%				0.08		%				0.38		%				0.15		%
Nonperforming loans and leases at historical cost (3)
Unguaranteed			$	99,907					$	81,412					$	49,398					$	37,340					$	43,117
Guaranteed			322,993						222,885						166,177						122,752						105,351
Total			422,900						304,297						215,575						160,092						148,468
Unguaranteed nonperforming historical cost loans and leases, to loans and leases held for investment (3)			0.96		%				0.82		%				0.52		%				0.42		%				0.51		%
Nonperforming loans at fair value (4)
Unguaranteed			$	9,938					$	9,115					$	8,672					$	9,590					$	7,942
Guaranteed			58,100						54,873						49,822						51,570						47,620
Total			68,038						63,988						58,494						61,160						55,562
Unguaranteed nonperforming fair value loans to fair value loans held for investment (4)			3.14		%				2.77		%				2.53		%				2.64		%				2.09		%
Capital Ratios
Common equity tier 1 capital (to risk-weighted assets)			10.70		%				11.04		%				11.19		%				11.85		%				11.89		%
Tier 1 leverage capital (to average assets)			8.03						8.21						8.60						8.71						8.69

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).

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Live Oak Bancshares, Inc.

Quarterly Average Balances and Net Interest Margin

(Dollars in thousands)

			Three Months Ended March 31, 2025																		Three Months Ended December 31, 2024
			Average Balance						Interest						Average Yield/Rate						Average Balance						Interest						Average Yield/Rate
Interest-earning assets:
Interest-earning balances in other banks			$	581,267					$	6,400					4.47		%				$	603,758					$	7,257					4.78		%
Investment securities			1,379,797						11,089						3.26						1,340,027						10,490						3.11
Loans held for sale			407,953						8,612						8.56						339,394						7,361						8.63
Loans and leases held for investment (1)			10,388,872						187,004						7.30						10,030,353						187,460						7.44
Total interest-earning assets			12,757,889						213,105						6.77						12,313,532						212,568						6.87
Less: Allowance for credit losses on loans and leases			(165,320)																		(155,498)
Noninterest-earning assets			534,133																		551,265
Total assets			$	13,126,702																	$	12,709,299
Interest-bearing liabilities:
Interest-bearing checking			$	350,491					$	3,929					4.55		%				$	350,304					$	4,350					4.94		%
Savings			5,540,147						51,604						3.78						5,333,338						52,308						3.90
Money market accounts			127,908						120						0.38						138,021						176						0.51
Certificates of deposit			5,563,004						55,235						4.03						5,376,290						56,523						4.18
Total deposits			11,581,550						110,888						3.88						11,197,953						113,357						4.03
Borrowings			111,919						1,685						6.11						114,561						1,737						6.03
Total interest-bearing liabilities			11,693,469						112,573						3.90						11,312,514						115,094						4.05
Noninterest-bearing deposits			342,482																		281,874
Noninterest-bearing liabilities			58,739																		83,373
Shareholders' equity			1,027,547																		1,028,426
Non-controlling interest			4,465																		3,112
Total liabilities and shareholders' equity			$	13,126,702																	$	12,709,299
Net interest income and interest rate spread									$	100,532					2.87		%										$	97,474					2.82		%
Net interest margin															3.20																		3.15
Ratio of average interest-earning assets to average interest-bearing liabilities															109.10		%																108.85		%

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

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Live Oak Bancshares, Inc.

GAAP to Non-GAAP Reconciliation

(Dollars in thousands)

			As of and for the three months ended
			1Q 2025						4Q 2024						3Q 2024						2Q 2024						1Q 2024
Total shareholders’ equity			$	1,031,447					$	1,003,496					$	1,007,756					$	961,049					$	927,718
Less:
Goodwill			1,797						1,797						1,797						1,797						1,797
Other intangible assets			1,529						1,568						1,606						1,644						1,682
Tangible shareholders’ equity (a)			$	1,028,121					$	1,000,131					$	1,004,353					$	957,608					$	924,239
Shares outstanding (c)			45,589,633						45,359,425						45,151,691						45,003,856						44,938,673
Total assets			$	13,595,704					$	12,943,380					$	12,607,346					$	11,868,570					$	11,505,569
Less:
Goodwill			1,797						1,797						1,797						1,797						1,797
Other intangible assets			1,529						1,568						1,606						1,644						1,682
Tangible assets (b)			$	13,592,378					$	12,940,015					$	12,603,943					$	11,865,129					$	11,502,090
Tangible shareholders’ equity to tangible assets (a/b)			7.56		%				7.73		%				7.97		%				8.07		%				8.04		%
Tangible book value per share (a/c)			$	22.55					$	22.05					$	22.24					$	21.28					$	20.57
Efficiency ratio:
Noninterest expense (d)			$	84,017					$	81,257					$	77,589					$	77,656					$	77,737
Net interest income			100,532						97,474						97,000						91,320						90,111
Noninterest income			25,581						30,593						32,932						34,159						26,097
Total revenue (e)			$	126,113					$	128,067					$	129,932					$	125,479					$	116,208
Efficiency ratio (d/e)			66.62		%				63.45		%				59.72		%				61.89		%				66.89		%
Pre-provision net revenue (e-d)			$	42,096					$	46,810					$	52,343					$	47,823					$	38,471

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.

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