Document

“The fundamental story at Live Oak is that our franchise is getting stronger. Our operating leverage is improving, Live Oak Express continues to accelerate, and our deposit franchise is marching with gaining momentum,” said Live Oak Chairman and CEO James S. (Chip) Mahan III. “The earnings power of this business is expanding because revenue growth is meaningfully outpacing expenses, our loan origination engine is running strong, and our strategic initiatives are delivering results. This operating leverage momentum has aided in absorbing the elevated provision expense in the quarter, which primarily supported record loan growth while also our continued efforts to decisively act to address stress in our distillery-related portfolio. As I think about our operating earnings model, strong loan pipeline, and the possibilities that AI may unlock for both our customers and our employees, I am truly excited about Live Oak’s future.”


(Dollars in thousands, except per share data)										3Q 2026 Change vs.
										2Q 2026				3Q 2025
	3Q 2026			2Q 2026			3Q 2025			$		%		$		%
Total revenue (1)	$	175,646		$	156,145		$	142,330		$	19,501	12.5	%	$	33,316	23.4	%
Total noninterest expense	85,720			84,525			83,516			1,195		1.4		2,204		2.6
Provision for credit losses	54,700			25,800			22,242			28,900		112.0		32,458		145.9
Income before taxes	35,226			45,820			36,572			(10,594)		(23.1)		(1,346)		(3.7)
Effective tax rate	25.4		%	19.9		%	27.6		%	n/a		n/a		n/a		n/a
Net income attributable to common shareholders	$	24,260		$	34,701		$	25,562		$	(10,441)	(30.1)	%	$	(1,302)	(5.1)	%
Diluted earnings per common share	0.52			0.74			0.55			(0.22)		(29.7)		(0.03)		(5.5)
Loan and lease production	2,133,637			1,548,432			1,648,711			585,205		37.8		484,926		29.4

Total loans and leases	13,869,854			13,142,671			11,915,511			727,183		5.5		1,954,343		16.4

Total assets	16,965,575			16,038,141			14,665,902			927,434		5.8		2,299,673		15.7
Total deposits	15,468,175			14,547,526			13,290,723			920,649		6.3		2,177,452		16.4

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; 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; 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; risks relating to the deployment and use of artificial intelligence by the Company, its customers, and counterparties; 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.


	Three Months Ended										3Q 2026 Change vs.
	3Q 2026		2Q 2026		1Q 2026		4Q 2025		3Q 2025		2Q 2026	3Q 2025
Interest income											%	%
Loans and fees on loans	$	237,270	$	221,705	$	214,129	$	218,852	$	211,599	7.0	12.1
Investment securities, taxable	14,254		13,411		13,009		12,679		12,175		6.3	17.1
Other interest earning assets	7,953		6,601		6,726		8,124		7,654		20.5	3.9
Total interest income	259,477		241,717		233,864		239,655		231,428		7.3	12.1
Interest expense
Deposits	124,850		114,776		112,847		114,879		114,266		8.8	9.3
Borrowings	1,618		1,603		1,617		1,656		1,677		0.9	(3.5)
Total interest expense	126,468		116,379		114,464		116,535		115,943		8.7	9.1
Net interest income	133,009		125,338		119,400		123,120		115,485		6.1	15.2
Provision for credit losses	54,700		25,800		20,100		21,845		22,242		112.0	145.9
Net interest income after provision for credit losses	78,309		99,538		99,300		101,275		93,243		(21.3)	(16.0)
Noninterest income
Loan servicing revenue	9,710		9,194		9,094		9,227		8,812		5.6	10.2
Loan servicing asset revaluation	(2,605)		(4,278)		(3,487)		(3,932)		(4,360)		39.1	40.3
Net gains on sales of loans	20,893		17,554		15,425		12,313		17,099		19.0	22.2
Net (loss) gain on loans accounted for under the fair value option	(66)		291		(1,165)		1,518		(350)		(122.7)	81.1
Equity method investments income (loss)	553		74		(817)		23,812		(1,470)		647.3	137.6
Equity security investments (losses) gains, net	(2,573)		—		—		4,691		18		(100.0)	(14,394.4)
Lease income	2,088		2,238		2,135		2,196		2,179		(6.7)	(4.2)

Other noninterest income	14,637		5,734		4,889		(38)		4,917		155.3	197.7
Total noninterest income	42,637		30,807		26,074		49,787		26,845		38.4	58.8
Noninterest expense
Salaries and employee benefits	46,918		48,776		49,354		47,988		49,910		(3.8)	(6.0)
Travel expense	1,756		1,933		1,463		1,715		1,618		(9.2)	8.5
Professional services expense	2,924		2,938		2,516		2,855		1,999		(0.5)	46.3
Advertising and marketing expense	2,314		2,734		3,051		2,298		1,839		(15.4)	25.8
Occupancy expense	2,384		2,364		2,410		2,317		2,339		0.8	1.9
Technology expense	10,263		9,608		9,749		13,397		10,234		6.8	0.3
Equipment expense	3,595		3,662		3,693		3,677		3,320		(1.8)	8.3
Other loan origination and maintenance expense	5,101		4,864		5,919		4,917		4,777		4.9	6.8
Renewable energy tax credit investment impairment	310		26		—		129		336		1,092.3	(7.7)
FDIC insurance	4,197		4,788		4,401		3,933		3,643		(12.3)	15.2

Other expense	5,958		2,832		2,737		5,927		3,501		110.4	70.2
Total noninterest expense	85,720		84,525		85,293		89,153		83,516		1.4	2.6
Income before taxes	35,226		45,820		40,081		61,909		36,572		(23.1)	(3.7)
Income tax expense	8,961		9,116		10,134		15,787		10,106		(1.7)	(11.3)
Net income	26,265		36,704		29,947		46,122		26,466		(28.4)	(0.8)
Net loss attributable to non-controlling interest	88		91		93		88		50		(3.3)	76.0
Net income attributable to Live Oak Bancshares, Inc.	26,353		36,795		30,040		46,210		26,516		(28.4)	(0.6)
Preferred stock dividends	2,093		2,094		2,094		2,094		954		—	119.4
Net income attributable to common shareholders	$	24,260	$	34,701	$	27,946	$	44,116	$	25,562	(30.1)	(5.1)
Earnings per common share
Basic	$	0.52	$	0.75	$	0.61	$	0.96	$	0.56	(30.7)	(7.1)
Diluted	$	0.52	$	0.74	$	0.60	$	0.95	$	0.55	(29.7)	(5.5)
Weighted average shares outstanding
Basic	46,325,262		46,265,757		46,138,609		45,906,268		45,780,794
Diluted	46,869,123		46,594,482		46,509,040		46,298,408		46,216,958


	As of the quarter ended										3Q 2026 Change vs.
	3Q 2026		2Q 2026		1Q 2026		4Q 2025		3Q 2025		2Q 2026	3Q 2025
Assets											%	%
Cash and due from banks	$	1,099,902	$	927,630	$	816,135	$	864,904	$	892,445	18.6	23.2

Certificates of deposit with other banks	250		250		250		250		250		—	—
Investment securities available-for-sale	1,500,709		1,467,855		1,434,538		1,427,401		1,373,219		2.2	9.3
Loans held for sale	496,807		511,812		435,313		420,055		360,693		(2.9)	37.7
Loans and leases held for investment (1)	13,373,047		12,630,859		12,158,216		11,973,622		11,554,818		5.9	15.7
Allowance for credit losses on loans and leases	(213,630)		(193,417)		(193,279)		(192,264)		(185,700)		(10.5)	(15.0)
Net loans and leases	13,159,417		12,437,442		11,964,937		11,781,358		11,369,118		5.8	15.7
Premises and equipment, net	220,894		231,198		235,329		240,203		241,140		(4.5)	(8.4)
Foreclosed assets	8,484		11,017		12,005		8,208		11,024		(23.0)	(23.0)
Servicing assets	71,215		66,733		64,677		63,155		62,491		6.7	14.0
Other assets	407,897		384,204		336,849		329,244		355,522		6.2	14.7
Total assets	$	16,965,575	$	16,038,141	$	15,300,033	$	15,134,778	$	14,665,902	5.8	15.7
Liabilities and shareholders’ equity
Liabilities
Deposits:
Noninterest-bearing	$	638,332	$	605,237	$	510,917	$	515,051	$	494,019	5.5	29.2
Interest-bearing	14,829,843		13,942,289		13,324,141		13,173,608		12,796,704		6.4	15.9
Total deposits	15,468,175		14,547,526		13,835,058		13,688,659		13,290,723		6.3	16.4
Borrowings	99,793		99,766		99,746		102,404		105,045		—	(5.0)
Other liabilities	85,373		73,931		83,468		89,609		67,585		15.5	26.3
Total liabilities	15,653,341		14,721,223		14,018,272		13,880,672		13,463,353		6.3	16.3
Shareholders’ equity
Preferred stock	96,266		96,266		96,266		96,266		96,266		—	—
Class A common stock (voting)	404,119		399,396		392,258		388,389		383,288		1.2	5.4

Retained earnings	892,626		869,757		836,444		809,885		770,820		2.6	15.8
Accumulated other comprehensive loss	(84,743)		(52,555)		(47,352)		(44,672)		(52,151)		(61.2)	(62.5)
Total shareholders' equity attributed to Live Oak Bancshares, Inc.	1,308,268		1,312,864		1,277,616		1,249,868		1,198,223		(0.4)	9.2
Non-controlling interest	3,966		4,054		4,145		4,238		4,326		(2.2)	(8.3)
Total shareholders' equity	1,312,234		1,316,918		1,281,761		1,254,106		1,202,549		(0.4)	9.1
Total liabilities and shareholders’ equity	$	16,965,575	$	16,038,141	$	15,300,033	$	15,134,778	$	14,665,902	5.8	15.7


	Nine Months Ended
	September 30, 2026		September 30, 2025
Interest income
Loans and fees on loans	$	673,104	$	611,728
Investment securities, taxable	40,674		34,912
Other interest earning assets	21,280		22,177
Total interest income	735,058		668,817
Interest expense
Deposits	352,473		338,534
Borrowings	4,838		5,045
Total interest expense	357,311		343,579
Net interest income	377,747		325,328
Provision for credit losses	100,600		74,458
Net interest income after provision for credit losses	277,147		250,780
Noninterest income
Loan servicing revenue	27,998		25,675
Loan servicing asset revaluation	(10,370)		(12,145)
Net gains on sales of loans	53,872		50,107
Net loss on loans accounted for under the fair value option	(940)		(302)
Equity method investments (loss) income	(190)		(6,425)
Equity security investments gain (losses), net	(2,573)		1,042
Lease income	6,461		7,855

Other noninterest income	25,260		13,864
Total noninterest income	99,518		79,671
Noninterest expense
Salaries and employee benefits	145,048		141,447
Travel expense	5,152		5,316
Professional services expense	8,378		7,897
Advertising and marketing expense	8,099		9,924
Occupancy expense	7,158		7,445
Technology expense	29,620		29,551
Equipment expense	10,950		10,750
Other loan origination and maintenance expense	15,884		13,552
Renewable energy tax credit investment impairment	336		606
FDIC insurance	13,386		10,739

Other expense	11,527		12,318
Total noninterest expense	255,538		249,545
Income before taxes	121,127		80,906
Income tax expense	28,211		21,385
Net income	92,916		59,521
Net loss attributable to non-controlling interest	272		140
Net income attributable to Live Oak Bancshares, Inc.	93,188		59,661
Preferred stock dividends	6,281		954
Net income attributable to common shareholders	$	86,907	$	58,707
Earnings per common share
Basic	$	1.88	$	1.29
Diluted	$	1.86	$	1.28
Weighted average shares outstanding
Basic	46,243,893		45,632,313
Diluted	46,658,232		45,956,835


	As of and for the three months ended
	3Q 2026			2Q 2026			1Q 2026			4Q 2025			3Q 2025
Income Statement Data
Net income attributable to common shareholders	$	24,260		$	34,701		$	27,946		$	44,116		$	25,562
Per Common Share
Net income, diluted	$	0.52		$	0.74		$	0.60		$	0.95		$	0.55
Dividends declared - common	0.03			0.03			0.03			0.03			0.03
Book value per common share	26.13			26.29			25.55			25.06			24.03
Tangible book value per common share (1)	26.05			26.20			25.46			24.97			23.96
Performance Ratios
Return on average assets (annualized)	0.59		%	0.90		%	0.74		%	1.19		%	0.72		%
Return on average common equity (annualized)	7.70			11.36			9.39			15.25			9.32
Net interest margin	3.30			3.33			3.27			3.38			3.33
Efficiency ratio (1)	48.80			54.13			58.63			51.56			58.68
Noninterest income to total revenue	24.27			19.73			17.92			28.79			18.86
Selected Loan Metrics
Loans and leases originated	$	2,133,637		$	1,548,432		$	1,368,311		$	1,638,113		$	1,648,711
Outstanding balance of sold loans serviced	6,338,443			5,991,590			5,943,787			5,599,724			5,563,363
Asset Quality Ratios
Allowance for credit losses to loans and leases held for investment (3)	1.62		%	1.56		%	1.62		%	1.64		%	1.65		%
Net charge-offs (3)	$	32,087		$	24,162		$	18,585		$	13,739		$	16,816
Net charge-offs to average loans and leases held for investment (2) (3)	1.00		%	0.80		%	0.63		%	0.48		%	0.61		%

Nonperforming loans and leases at historical cost (3)
Unguaranteed	$	138,422		$	124,336		$	116,791		$	101,371		$	76,887
Guaranteed	370,267			346,419			327,409			399,786			379,381
Total	508,689			470,755			444,200			501,157			456,268
Unguaranteed nonperforming historical cost loans and leases, to loans and leases held for investment (3)	1.05		%	1.00		%	0.98		%	0.87		%	0.68		%

Nonperforming loans at fair value (4)
Unguaranteed	$	11,607		$	6,623		$	6,884		$	7,715		$	6,775
Guaranteed	46,300			52,695			54,679			53,887			54,887
Total	57,907			59,318			61,563			61,602			61,662
Unguaranteed nonperforming fair value loans to fair value loans held for investment (4)	5.36		%	2.85		%	2.81		%	2.96		%	2.42		%

Capital Ratios
Common equity tier 1 capital (to risk-weighted assets)	9.94		%	10.42		%	10.63		%	10.53		%	10.51		%
Tier 1 leverage capital (to average assets)	8.23			8.59			8.47			8.48			8.57

Notes to Quarterly Selected Financial Data


	Three Months Ended September 30, 2026						Three Months Ended June 30, 2026						Three Months Ended September 30, 2025
	Average Balance		Interest		Average Yield/Rate		Average Balance		Interest		Average Yield/Rate		Average Balance		Interest		Average Yield/Rate
Interest-earning assets:
Interest-earning balances in other banks	$	818,936	$	7,953	3.85	%	$	710,110	$	6,601	3.73	%	$	701,059	$	7,654	4.33	%

Investment securities	1,577,763		14,254		3.58		1,519,670		13,411		3.54		1,418,810		12,175		3.40
Loans held for sale	571,358		11,460		7.96		527,857		10,441		7.93		396,084		8,103		8.12
Loans and leases held for investment (1)	13,022,914		225,810		6.88		12,322,003		211,264		6.88		11,249,234		203,496		7.18
Total interest-earning assets	15,990,971		259,477		6.44		15,079,640		241,717		6.43		13,765,187		231,428		6.67
Less: Allowance for credit losses on loans and leases	(192,700)						(193,304)						(182,001)
Noninterest-earning assets	586,176						537,352						530,529
Total assets	$	16,384,447					$	15,423,688					$	14,113,715
Interest-bearing liabilities:

Savings	$	7,661,348	$	64,020	3.32	%	$	7,170,652	$	58,289	3.26	%	$	6,608,380	$	58,657	3.52	%

Certificates of deposit	5,856,418		55,322		3.75		5,637,001		51,968		3.70		5,272,818		51,443		3.87
Other interest-bearing deposits	747,469		5,508		2.92		629,105		4,519		2.88		498,455		4,166		3.32
Total deposits	14,265,235		124,850		3.47		13,436,758		114,776		3.43		12,379,653		114,266		3.66
Borrowings	99,761		1,618		6.43		99,743		1,603		6.45		106,744		1,677		6.23
Total interest-bearing liabilities	14,364,996		126,468		3.49		13,536,501		116,379		3.45		12,486,397		115,943		3.68
Noninterest-bearing deposits	594,809						536,054						401,916
Noninterest-bearing liabilities	64,497						29,222						63,133
Shareholders' equity	1,356,092						1,317,767						1,157,893
Non-controlling interest	4,053						4,144						4,376
Total liabilities and shareholders' equity	$	16,384,447					$	15,423,688					$	14,113,715
Net interest income and interest rate spread			$	133,009	2.95	%			$	125,338	2.98	%			$	115,485	2.99	%
Net interest margin					3.30						3.33						3.33
Ratio of average interest-earning assets to average interest-bearing liabilities					111.32	%					111.40	%					110.24	%


	As of and for the three months ended
	3Q 2026			2Q 2026			1Q 2026			4Q 2025			3Q 2025
Total shareholders’ equity	$	1,312,234		$	1,316,918		$	1,281,761		$	1,254,106		$	1,202,549
Less:
Preferred stock	96,266			96,266			96,266			96,266			96,266
Non-controlling interest	3,966			4,054			4,145			4,238			4,326
Total common shareholders' equity	$	1,212,002		$	1,216,598		$	1,181,350		$	1,153,602		$	1,101,957
Less:
Goodwill	1,797			1,797			1,797			1,797			1,797
Other intangible assets	1,937			2,013			2,089			2,165			1,453
Tangible common shareholders’ equity (a)	$	1,208,268		$	1,212,788		$	1,177,464		$	1,149,640		$	1,098,707
Shares outstanding (c)	46,377,874			46,283,620			46,240,691			46,032,402			45,855,739
Total assets	$	16,965,575		$	16,038,141		$	15,300,033		$	15,134,778		$	14,665,902
Less:
Goodwill	1,797			1,797			1,797			1,797			1,797
Other intangible assets	1,937			2,013			2,089			2,165			1,453
Tangible assets (b)	$	16,961,841		$	16,034,331		$	15,296,147		$	15,130,816		$	14,662,652
Tangible common shareholders’ equity to tangible assets (a/b)	7.12		%	7.56		%	7.70		%	7.60		%	7.49		%
Tangible book value per common share (a/c)	$	26.05		$	26.20		$	25.46		$	24.97		$	23.96
Efficiency ratio:
Noninterest expense (d)	$	85,720		$	84,525		$	85,293		$	89,153		$	83,516
Net interest income	133,009			125,338			119,400			123,120			115,485
Noninterest income	42,637			30,807			26,074			49,787			26,845
Total revenue (e)	$	175,646		$	156,145		$	145,474		$	172,907		$	142,330
Efficiency ratio (d/e)	48.80		%	54.13		%	58.63		%	51.56		%	58.68		%
Pre-provision net revenue (e-d)	$	89,926		$	71,620		$	60,181		$	83,754		$	58,814

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.