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Image source: The Motley Fool. Friday, July 31, 2026 at 4:00 a.m. ET Director, Investor Relations - Andres Viroslav Chief Executive Officer - Damian Kozlowski Chief Financial Officer - Dominic Canuso Operator: Hello, everyone. Thank you for joining us, and welcome to The Bancorp, Inc. Second Quarter 2026 Earnings Conference Call. [Operator Instructions] I will now hand the conference over to Andres Viroslav. Andres, please go ahead. Andres Viroslav: Thank you, operator. Good morning, and thank you for joining us today for The Bancorp's Second Quarter 2026 Financial Results Conference Call. On the call with me today are Damian Kozlowski, Chief Executive Officer; and Dominic Canuso, our Chief Financial Officer. This morning's call is being webcast on our website at [www.thebancorp.com](https://www.thebancorp.com). There will be a replay of the call available via webcast on our website beginning at approximately 12:00 p.m. Eastern Time today. Before I turn the call over to Damian, I would like to remind everyone that our comments and responses to questions reflect management's view as of today, July 31, 2026. Yesterday, we issued our second quarter earnings release and updated investor presentation. Both are available on our Investor Relations website. We will make certain forward-looking statements on this call, these statements are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and are subject to risks and uncertainties that could cause actual results to differ materially from the expectations and assumptions we mentioned today. These factors and uncertainties are discussed in our reports and filings with the Securities and Exchange Commission. In addition, we will be referring to certain non-GAAP financial measures during this call. Additional details and reconciliations of GAAP to adjusted non-GAAP financial measures are in the earnings release. Please note that the Bancorp undertakes no obligation to publicly release the results of any revisions to forward-looking statements, which may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Now I'd like to turn the call over to The Bancorp's Chief Executive Officer, Damian Kozlowski. Damian? Damian Kozlowski: Thank you, Andres. Good morning, everyone. The Bancorp earned $1.45 a share in the second quarter. EPS growth year-over-year was 14.2%. ROE was 34.7%, continuing on its upward path The Bancorp already has an ROE roughly triple the average of the banking industry, and we expect sizable increases over the next 3 years. Consistent with our capital return philosophy, profitability increases are expected to be returned to our shareholders through share repurchases. In the last 4.5 years, The Bancorp has returned the equivalent of 100% of equity capital based back to shareholders through buybacks. We expect that time frame to decrease to around 3 years over the next 3 years. After that buying back the equivalent of our capital base in 2 years or less is a reasonable forecast. This results in annual EPS accretion of approximately 5% to 10% depending on the price of shares purchased and before our projected increase in net income, which should result in dramatic EPS accretion over the next 5 years. Fintech GDV continue to grow significantly above trend at 22.5% year-over-year for the second quarter of '26. Fintech revenue growth in the quarter, which includes both fee and spread revenue was 21% year-over-year. Our 3 main fintech initiatives that underpin our Apex 2030 strategy continue to progress quickly and are well positioned for substantial long-term success. Our onboarding of new programs and expansion of current programs continues within or exceeding our targets. The Cash App program is now ramping up and should start contributing to GDV growth and profitability over the coming quarters with more material contributions coming in late Q4 and Q1 of '27. Credit sponsorship balances continue to surpass our expectations. We anticipate announcing 2 new programs that subject to implementation timing and other customary factors would be expected to come online next 6 months. Embedded finance platform development continues with significant progress in building a robust integrated platform connected to our one-of-a-kind ecosystem. We should soon make an announcement on our first embedded finance partner. Lastly, we're increasing our full year guidance to a range of $5.95 to $6.05 EPS for '26. We are targeting a range of $1.65 to $1.75 a share in the fourth quarter of '26 and we are maintaining a preliminary guidance for '27 of $8.10 to $8.30 a share. Our guidance in '26 and '27 includes anticipated stock buybacks. 2026 buybacks are forecast to be $200 million in total or $50 million a quarter, and we forecast future share repurchases to be near 100% of annual net income. We expect that our 3 main fintech initiatives along with platform efficiency and productivity gains from restructuring and AI tools, plus a high level of capital returned through buybacks will be the driving forces behind continued EPS accretion. EPS gains are subject to development implementation time lines in fintech and our stock price for any future buybacks. And now I'll turn the call over to our CFO, Dominic Canuso. Dominic? Dominic Canuso: Thank you, Damian. The second quarter was a very strong quarter, topping off record level earnings for the first half of the year and positions us well to achieve our expectations for the second half of '26 and full year '27. While ending loans were down from the first quarter, this was due to a change in month-end customer billing cycle and payment due dates with our lending partner. This does not affect customer performance or our economics. Average loans for the quarter of $7.63 billion increased 5%, not annualized from the first quarter and 16% compared to the second quarter of 2025. Average fintech loans in the quarter were $1.39 billion or 18% of average total loans, up from 15% in the first quarter and 8% in the second quarter of '25. Our strategy is to continue to shift the loan mix towards the higher velocity, higher returning credit sponsorship business. Average deposits increased $97 million or 1.2% not annualized from the first quarter and $357 million or 4.4% from the second quarter of last year. The average cost of deposits decreased 7 basis points in the quarter to 1.63%, which is 55 basis points lower than the second quarter of '25. We ended the quarter with $1.1 billion in net deposits swept off the balance sheet, which is down 16% from the first quarter due to seasonality but up 32% from year-end '25. While there may be quarter-to-quarter fluctuations in our off balance sheet sweeps due to seasonality or other factors, due to the strength of our partnership model and their growth, we expect this to increase over time. NIM of 3.85% in the second quarter was relatively flat with the first quarter and consistent with expectations. Our fintech lending fees, which are recognized as fee revenue generates an equivalent to an additional 28 basis points of NIM compared to 24 basis points in the prior quarter and 18 basis points in the second quarter of '25. In addition, we generated $680,000 in fee revenue from our deposit sweeps, which would equate to 3 basis points of additional NIM. Noninterest income, excluding credit enhancement, was $47.3 million, an 8.2% increase not annualized compared to the first quarter and 16.7% versus prior year quarter. This equates to 34.3% of total revenue with 29.7% of total revenue coming from fintech fees, up 1 percentage point from the first quarter and 4 percentage points from the second quarter of '25. As I mentioned last quarter, growth in credit sponsorship loans is a leading indicator of fintech fees due to the velocity of the portfolio and was demonstrated in the growth in the fintech fees in the quarter, including the 17% nonannualized growth from the first quarter, specifically from the consumer credit fintech fee line. Credit performance was strong across all asset classes with continued improvements in REBL and leasing. REBL criticized loans were down another $13 million or 22% to $46 million the lowest level since mid-'23. When excluding the fintech credit sponsorship loans, which are supported by full credit enhancement, our traditional lending portfolio saw a provision of $0.4 million in the quarter, consistent with the loan growth and overall credit performance from the traditional lending portfolio. Noninterest expense in the quarter was $56.5 million with an efficiency ratio of 41%. Costs continue to be managed prudently, generating continued positive operating leverage driven by our investments in AI, repositioning our revenues towards fintech and the demonstrated scale of our fintech platform. Operator, you may now open the call for questions. Operator: [Operator Instructions] Your first question comes from the line of Joe Yanchunis with Raymond James. Joseph Yanchunis: So I was hoping to start with the fintech loans. Can you provide a little more detail on the payment timing dynamic that you called out that impacted the period-end balances? And I mean, should we think of average balances as a better indicator of the underlying trajectory? And do you expect like the period end balance to kind of normalize over the next couple of quarters? Damian Kozlowski: Yes. So it's -- sure. It doesn't affect our economics and stuff, but Dominic will go into detail. Dominic Canuso: Sure. Thanks, Joe. Yes, I would say, overall, average balances in each quarter are more indicative of our economics because traditionally, the fintech lending products are short term in nature and are affected by seasonality. With that said, this was a onetime change, particularly with the credit -- the fintech lending product where we actually accelerated the payment due date by 1 day to actually align with the terms and conditions with the customer. So there was no contractual changes, no changes with our customer performance and no changes in our economics. And you saw that in both the loans stepping down and deposits on an ending balance basis. From here, it's normalized. So this was a onetime change. So while average balances will be more indicative of economic performance. The ending balance from here forward will also be in line with the change in average balances. Joseph Yanchunis: Got it. I appreciate that. And then you mentioned expecting 2 additional sponsored lending programs to come online over the next couple of quarters. Can you help us think about the characteristics of those programs? Are they going to be similar to like Chime and be balance sheet intensive or something a little more higher velocity than fee income? Damian Kozlowski: No, they will be much higher velocity, our Chime relationship is extremely synergistic. And so it will be less -- it will be -- once again, it will be very structured it will be with partners that you'll know. It will be similar types of loan products, though we'll have changes as we go forward in different categories. But they won't use the balance sheet in the same way that Chime does. Joseph Yanchunis: Got it. So would that volume show up under GDV then? Damian Kozlowski: Well, no, the loans will be loans, of course, and there may be some spend in these programs off the back of the loans in certain cases. But no, they will be booked as loans, and you'll see them in the fintech loan line and may have some ancillary impact on GDV. Joseph Yanchunis: Understood. And then last one for me here. Just kind of want to talk about your outlook for a moment. I mean, you made a couple of tweaks to the 4Q number, reiterated your preliminary 2027 outlook. Can you walk us through some of the factors behind the change in the 4Q number? Damian Kozlowski: Dominic, do you want to handle that? Dominic Canuso: Sure. Yes, I would say this was a minor change in our expectations, and it really comes down to honing in on the timing of that pipeline that we just talked about, which is why we reiterated our 2027 expectations. So from our perspective, we continue to anticipate a ramp-up in profitability from the second quarter to the fourth quarter and ability for that step-off point to hit our 2027 target. So from our perspective, the changes in that -- to that range is really a function of aligning with the phasing of onboarding and the growth anticipated from those programs. Operator: [Operator Instructions] Your next question comes from the line of Tim Switzer with KBW. Timothy Switzer: The first one I have is on net interest margin or maybe more appropriately NII for you guys. But how should we think about the trajectory of NII going forward and the potential impact of Fed rate hikes? And what's the impact of higher rates on your loan yields now that, that portfolio has kind of changed a little bit? Damian Kozlowski: Dominic will go into detail, but the -- we're fairly neutral on the balance sheet. We're slightly maybe a little bit asset sensitive on that side. So rate hikes won't really help us that much, but it won't definitely will not hurt us. Dominic? Dominic Canuso: Sure. And just to hone in on that. We are -- we try to manage to the interest rate neutral position. However, there could be some intra month or intra-quarter impact from the timing of any Fed rate changes due to the timing in which they impact loans versus deposit repricing resets. But over a quarter or 2, it's a very neutral impact, and we've been disciplined in managing to that level. From an NII perspective, as we look through the rest of the year, I would say on a dollar basis, it's relatively neutral. We should see some compression in NIM as we migrate further to the fintech lending, but that should be offset by continued strength in the traditional lending average balance for the second half of the year. On a NIM equivalent, just like you saw this quarter, we may see a slight tick down in that traditional calculation of NIM, but when you normalize for the fintech lending fees like we saw this quarter when incorporating those, it actually blended up a couple of basis points. So in summary, NII should be flat for the -- near flat for the second half of the year with a step down in NIM and a slight flat to up on the equivalent. Timothy Switzer: Very helpful. Okay. And on the card fees, good to see some of the acceleration in GDV. Is there any color on how much was driven by Square, Cash App and the other new programs versus legacy ones? And Damian, in your comments about Cash App making a more significant contribution in late Q4 and Q1 of next year. That seems like it changed from your commentary previously about the second half of this year. So is that a little bit more delayed by other programs? I mean, appear to be making up for it right now? Damian Kozlowski: Cash App is very unique because of the potential volume there because it's an ongoing program is very large compared to for the portfolio. So it can really produce a lot of incremental growth. That's usually not the case where it's that large. And it's really just impacting us now. And will ramp through the end of the year. So it's -- it will have a meaningful impact on GDV as we approach the end of the year. It's not really -- we don't give independent for each program. We'll let the programs give their own dialogue on their growth. But it's very broad-based. It's coming from most of our 15 verticals and it's really -- you see across the virtual, the neobank, the virtual wallet segment, you see it through health care, corporate payments. It's very broad-based. Timothy Switzer: Okay. All right. So if I'm interpreting what you're saying correctly, it sounds like the acceleration would have happened regardless of Chime -- or sorry, Cash App further acceleration over the course of the year, quarter-over-quarter. Damian Kozlowski: Yes, this has nothing -- there's very little of Cash App in there. It's really not impacting your number, maybe up 1 point percent or less at this point, but it's quickly ramping, and it should really start to affect GDV as we approach the end of the year. Timothy Switzer: Okay. Great to hear. And then I know this has been a common discussion point on these calls recently, but you have some prominent partners who have applied for a bank charter. Others who have indicated they will eventually maybe apply. And could you provide some examples of how Bancorp could still provide some BaaS services to companies with an ILC or other type of charter and what those partnerships could look like? Damian Kozlowski: Yes. So we provide a very scalable infrastructure, right? And we're talking about there's many segments we're in that you really never going to be a bank, right? It could be corporate payments, it could be healthcare. In certain cases, they're never going to government payments. There's never going to be a bank, they're never going to become a bank. So you're really talking about the neobank segment. And we're providing an incredibly scalable middle office platform that can't be replicated by these programs, right? That cost to go in to replicate it is enormous. And we are a very small expense on their own financial lines. So there's a lot of value we bring. You enter our ecosystem, you benefit from this incredible scale and sophistication that's very hard to replicate on your own. So we don't think -- first of all, it takes a very long time to build these platforms the right way. It would -- you lose an information, which is, in a lot of cases, a big competitive advantage of us. You lose the sophistication with regulators. So we think that it's not going to impact us especially in the near to the medium term. And as the -- we continue to build our scale and become much more efficient, I think we can add value to those regardless of the license or not, we can add substantial value to these large programs, nevertheless. And so we don't think it's going to impact us. Timothy Switzer: Okay. I mean if they're applying for these charters, they obviously want to do something with it. So like how could these change what your partnership or programs look like? And is there any sense of your product base where we see more risks or more opportunities as this goes on, whether that's deposits, credit sponsorship, the payment side or anywhere else? Damian Kozlowski: Yes. Yes, it depends on what charter they want, but it's usually a funding situation where they want to have, in some way, a deposit. And we're talking about a charter that's consumer base that's not an industrial charter, right? So they become a bank and they are able to self-fund, but we're kind of doing that already, if you think about it with the Chime where they're using our balance sheet. But for some of these programs that are only lending base, they want that capability to self-fund. And that's where it's mostly coming from. Dominic Canuso: And Tim, just to add to that one consideration is if you think about the velocity of the loans generated, particularly by NEOs, having their own balance sheet allows them to be the buyer first choice and control the economics around holding loans. So to the extent there are partners with bank charters that want to hold the loans. We actually see that as a potential benefit because as the velocity increases, we are looking to off-balance sheet these loans over time as we grow that business, and it would be a logical place for that particular partner if they had a charter to hold their own loan after we originate and go through our compliance efficiencies that we bring to the table. So we think there could be a net-net benefit in that particular situation. Timothy Switzer: Okay. Yes. And just to make sure I understand your point here, it would make a lot of sense for Bancorp to still be the originator of these loans for a lot of the neobanks because you guys have the expertise on the regulatory side? And Damian, going back to your comment on my first question about how expensive it is to build this out and you guys have spent a lot of time on infrastructure. I think in the past, you guys have shared the overall investment cost it took to build the robust regulatory compliance infrastructure you guys have over the last, like 5-plus years. Could you go into that just a little bit behind it? [indiscernible]. Damian Kozlowski: It's very expensive. I mean, we've spent I mean, over the last 10 years, well north of $100 million, just $100 million just for the base platform. So -- and that's every year, you're investing in building for the future. So that adds up every year. And it's not just the amount of money, it's the amount of time that it takes to do that. it takes multiple years to build a platform that's robust enough to handle the broad middle office that you need to do in compliance, the regulatory relationships but also the tech stack. And we have that already. We've invested in it to really have the best-in-class over 10 years and to catch up to that in a shorter time frame, just cost more money. So to say you can do it in 3 years, you're going to balloon your costs. And this has been seen when people try to build it out. in other places, the cost -- the shorter time that you take to try to do it, and that's problematic in itself, the cost skyrocket. So if you're going to get your banking license and you want to have everything done in-house. That's -- first of all, it starts with multiyear. It doesn't start with a 6-month project. This is a 3- to 5-year project. It requires you to increase your investment upfront because you're going to want to reduce the time and that is going to have a significant premium to what we're charging, right? So the payback on that investment, and you're going to get less quality, of course, especially over the first part of that until you get sophisticated, it's going to be multitudes of what we charge over any reasonable time. So there is a real value we believe we bring the investment is prohibitive to get to where we are. And at the end of the day, it's a time frame issue. I mean we're talking about long-term commitments, ongoing investment and it will never be at scale. No matter how big you are, you'll never be at our scale, not even close. So you can't -- you'll never get to that unit cost that we can get to across our portfolio. Dominic Canuso: Just to add a finer point to that. There is a significant benefit to all of our partners from what we call the halo effect, right? We're at $200 billion of GDV in the last 12 months. So our ability to see across payment types, across partners, across programs, ongoing fraud financial crimes that we can transfer the benefit across all of our partners that you just can't get with one program or a few programs. And then just to add, again, we have added slides in our investor presentation, particularly Slide 11 that demonstrates the scale and efficiency of our platform on a cost per GDV basis and our ability to improve our operating leverage and increase it over time, which, again, comes down to the inability to replicate. Operator: Your next question comes from the line of Manuel Navas with Piper Sandler. Manuel Navas: Talk about the fintech loan balances. Is the target still the same in terms of growth by the end of the year? And how would you judge kind of the progression of growth so far this year, like it's $1.4 billion on an average basis. Is that the number we should be growing from in the third quarter? Dominic Canuso: I would say -- go ahead. Damian Kozlowski: No. Go ahead, Dominic. Dominic Canuso: We do expect that to continue to improve both with our existing partners and the pipeline. The exact amount is a function of the timing of the launch of partners and the velocity and product that are launched. So we do expect it to increase. We talked about working towards a $2 billion level by the end of this year. We expect to work towards that. However, we could have programs that just have higher velocity and lower average balances, but ultimately deliver the fourth quarter expectations and full year 2027 outlook that we've provided. Manuel Navas: And with just to kind of confirm, on the client side, on the customer side, there was no disruption in any services from this payment date processing shift? Dominic Canuso: Not at all. In fact, it was just an acceleration of a couple of days of the payment from the credit builder Chime card product to align with the actual terms and conditions. So it was seamless and effectively unnoticeable. It just changed the ending balance by 1 or 2 days depending. So again, no change in economics, customer impact, customer terms or performance. Manuel Navas: Okay. And the progression and growth of that program is going as expected outside of this kind of figuring out some nuts and bolts, but the progression of that program continues well? Dominic Canuso: Absolutely. It's on, if not better, and as you've seen in the average balance of growth that we demonstrated in the quarter. Manuel Navas: Yes. And then switching over -- you still have the range on the 2027, based on this quarter's results, your progression with programs that are expected to hit. What are kind of like the updated factors driving the low end or the high end of the '27 EPS guide, please? Dominic Canuso: Sure. At the end of the day, the range that we're talking about is $0.20 on $8. So it's incredibly small range from a percentage perspective and just captures the recognition of significant growth from where we are today to the fourth quarter into a full year of next year. And recognizes the fact that our pipeline is strong and that the exact timing and launch and phasing of those programs have some variability to it, which we're comfortable with because we -- when we launch new products and partners we want to be disciplined to have the right controls around it, the enterprise risk management around it. So the range we're offering is really, really tight and it demonstrates that there could be some phasing, but the overall economics and growth in ROA and ROE hold to be significantly above this year. Operator: The next question comes from Joe Yanchunis with Raymond James. Joseph Yanchunis: I just want to ask a couple more. So as sponsored lending becomes a larger part of the balance sheet, can you discuss how the framework for monitoring fintech counterparties have evolved? Like beyond credit enhancements what ongoing financial liquidity or operational metrics you track to ensure your partners remain capable of supporting their obligation? Damian Kozlowski: Yes. First of all, you got to remember, we're dealing with very large enterprises, many of which are public companies, okay? So the disclosure there is enormous. And we go through a very rigorous process around all our partners and third-party risk management. So we delve into understanding their liquidity, their business plans, their metrics, what they expect to spend on things like marketing. We get a full disclosure of not only their current financial position, but their future forecast. And we test that. And we monitor it very closely and ensure that the partner has the wherewithal to continue business and build its own business. And we do disengage when -- and we do it early. We don't wait. We monitor these things, and we've done smaller programs in the past, and we've disengaged from those programs when they're not successful before you get to a point where there will be a -- some type of impact. So we take very proactive high scrutiny and this is continuous through our third-party risk management process. Joseph Yanchunis: And then I was also hoping you could provide an update on your AI initiatives? Are the productivity gains still tracking in line with your expectations? And where do you see the next opportunities for [indiscernible]? Damian Kozlowski: It's incredibly exciting. It's the improvement in AI has been dramatic over the last year. where it's really impacting us, first of all, is in 2 ways on an enterprise level where our people are getting more empowered through AI to make their jobs more interesting even and vut the -- and get their productivity up substantially. And then secondly, in use cases. One, for example, is the financial crimes where we have AI-empowered narrative writing capability that's improving monthly and making our people much more productive. And this really helps us manage the number of employees and make them much more efficient and productive, make their job better and it's improving rapidly. So we're growing this GDV and in 4, 5, 6x what the market is growing, and we're able to handle that new volume by using some of these tools. So it's very exciting. It's getting better. We really are embedding it in the way we do business in both ways, enterprise level and then use case level. And it's going to have a dramatic impact on our ability to continue to grow and control our expenses going into the future. Operator: Your next question comes from the line of Arif Gangat with [ Cygnus Capital ]. Arif Gangat: I had a question about the debt balance on the balance sheet. It increased meaningfully both sequentially and year-over-year. If you could please kind of share your thinking around funding the business with additional debt and if we should expect that to continue? Damian Kozlowski: Dominic, do you want to handle that? Dominic Canuso: Sure. Yes, when looking over the financials year-over-year, clearly, that's impacted by the upsizing of the debt issuance in late 2025, which was very strategic for us as we saw an opportunistic position to raise debt, repurchase our shares and have an accretive impact to our shareholders, which has played out meaningfully over the past year and aligns with our capital return philosophy, which we talk about. There was an increase quarter-over-quarter in some short-term borrowings, more from a liquidity perspective as we just manage the balance sheet. We're very focused on optimizing our returns and have significant access to borrowing, first of which is the fact that 95% of our deposits are from fintech and FDIC insured. So they're very stable and granular and low cost. We have $1.1 billion of deposits off balance sheet, which we have the ability to pull back and optimize both to fund the business and/or generate revenue. We have more than 50% of our deposit base in readily accessible borrowings at market costs. And most importantly, strategically, we expect our business -- our core business on the fintech side to continue to grow deposits. And so with the fact that we're near maxed out on the asset side of the balance sheet with the run rate to continue to grow deposits, we see ample opportunity to continue to fund the business without taking on any long-term debt and any short-term borrowings would be to fund intra-month or intra-quarter seasonality. Arif Gangat: Got it. That's very helpful. I appreciate it. Just to clarify, sequentially, debt went up ballpark $265 million or so. So from a liquidity point of view, given that the fintech loan book for the reasons you outlined earlier on the call, the onetime change actually shrunk. Can you help us understand what drove the liquidity need? Dominic Canuso: Sure. Well, first, is the first quarter is a seasonally high deposit generating quarter. And so there is an expectation that there's a seasonal step down from first to second quarter, plus the continued average balance growth that we've seen, both on the traditional lending side and the fintech side. The impact from 1Q to 2Q is more seasonal in nature and not business trend. It's -- the long-term trend is our ability to fund the business. And so as I mentioned, we expect for the rest of this year, the deposit growth to outpace our lending growth, so that will bring that amount back lower. And again, we have many levers to pull to be able to optimize that. So when we consider liquidity, the cost and access of liquidity, that's all incorporated in our expectations for continued earnings growth and EPS growth in our guidance that we provided. Arif Gangat: Okay. Very helpful. I appreciate it. And then I do have another question on -- a couple of questions on the REBL portfolio. The 10-Q is not filed yet, but if you could please share how much of the REBL book, just ballpark you expect to mature within the next 12 months? Damian Kozlowski: So we're over -- so we have -- go ahead, Dominic. Dominic Canuso: Sure. Just as a reminder, the REBL portfolio is structured. These are structured loans at 3-year loans with a plus 2 1-year extensions. So in general, they're naturally short term in nature. So we expect any year, 1/3 of the portfolio to churn or redo, and with the continued improvement, the maturation of the investments in the loan portfolio, the properties themselves, the loan to value continues to improve. The sponsors are stronger and so -- and we're comfortable with where pricing is in the market relative to where the pricing -- contractual pricing of the book. So we do not see a credit or price cliff given the short-term nature of that portfolio. We're very comfortable with how it's performing and its expectations to continue to contribute meaningfully on an ROA and ROE basis going forward. Damian Kozlowski: Yes, we did have a bump -- yes, just adding to that, we did have a bump in the past, but we're through that, and that was because we got back into the business in the early 2020s, the '22 vintage, which became a migrated in credit quality due to all the pandemic, that bump we've gotten through. So now it's much more on a normal basis because we're originating kind of as a replacement cycle. So you're getting a much a normal role on the portfolio. Arif Gangat: Got it. Okay. I think if memory serves from the March Q, as of 3/31, roughly just shy of $1 billion was slated to come due. So my question is, is it your expectation that those loans as they mature would be refied out by external third-party lenders generally? Or would you folks look to refinance yourselves out with a new loan to the same sponsor? Damian Kozlowski: We don't do new loans. What we do unless we had an asset that's been repositioned what usually occurs is that it's a 3-year loan with 2 options to extend it depending on if they accomplish their business plan and everything, they -- so there's 2 extensions built in. And that's totally dependent on completion of the project. After that is done, then they go if they choose to, they -- well, they will leave, right? They usually a lot of agency, but the refi with another bank. We don't do the stabilized finance. So that's where the role comes from. And you can be anywhere in that cycle. So when you're looking at that number, that could be somebody that's extended already. It could be somebody who's just finished their project. But we want to keep generally, we want to keep loans when you complete a project and they want to extend a year or even 2, that's a very good stabilized loan. And it's usually at their discretion, even though we obviously have a say in it, but it's their discretion because they want to -- they're waiting for change in interest rates or they're looking out for their own takeout strategy within their portfolio. So we accommodate that and that's built into the structure of the credits. Arif Gangat: Okay. Got it. Very helpful. And then lastly, could we please have an update on the status of the Aubrey stabilization and how are you folks thinking about getting that asset out of OREO? Damian Kozlowski: Yes. So it's past 70% of occupancy, right? We want to -- we're so far along. We have a few buildings. There's a lot of buildings at the site. So we still -- we're down to the last few buildings, and we're in 3 phases of renovation of those buildings. We're way north of 70% of the buildings that are already completed. So we're at the point now that the appraisal is way above 50% and our basis is in the low 40s. So now we're at the point that we're going to get to the stabilized takeout. And so that's a different market than somebody who's going to be a financial sponsor. There's just been so much work done. We're at the breakeven point. And as we continue with the occupancy, we'll actually, it will be a profit positive rather than a drag. So we're just -- we should be able to be completed from the first quarter, and that's where the stabilization will occur. Operator: We have reached the end of the Q&A session. I will now turn the call back to Damian Kozlowski for closing remarks. Damian Kozlowski: Thank you, everyone, for joining us on the call today. We will be attending various investor conferences during the third quarter, and we'll be on the road with investors in the coming weeks. We look forward to meeting with many of you throughout the quarter. Thank you, operator. You may discontinue the call. Operator: This concludes today's call. Thank you for attending. You may now disconnect. Before you buy stock in Bancorp, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Bancorp wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $397,405!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,344,091!* That performance is why people listen. With a track record of beating the S&P 500 by 4x, Stock Advisor offers a distinct advantage. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built for the long haul. See the 10 stocks » *Stock Advisor returns as of August 7, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Bancorp (TBBK) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Achieved 14.2% year-over-year EPS growth and a 34.7% ROE, which management notes is approximately triple the banking industry average. Fintech Gross Dollar Volume (GDV) grew 22.5% year-over-year, significantly above historical trends, driven by broad-based expansion across 15 verticals including neobanking and corporate payments. Strategic loan mix shift continues toward higher-velocity, higher-returning credit sponsorship business, with fintech loans now comprising 18% of average total loans compared to 8% a year ago. Management attributes operational efficiency gains to the integration of AI tools in financial crimes reporting and narrative writing, enabling the platform to scale without proportional headcount increases. The Cash App program has begun ramping up, with management expecting it to contribute more materially to GDV and profitability starting in late Q4 2026 and Q1 2027. Credit performance remains strong with REBL criticized loans decreasing 22% to $46 million, the lowest level since mid-2023, following the successful navigation of the 2022 vintage cycle. Capital allocation remains focused on share repurchases, having returned 100% of equity capital base to shareholders over the last 4.5 years, with plans to accelerate this cycle to every 2 to 3 years. Increased full-year 2026 EPS guidance to a range of $5.95 to $6.05, assuming $200 million in total share buybacks for the year. Maintained preliminary 2027 EPS guidance of $8.10 to $8.30, predicated on the full-year impact of new fintech programs and continued high-velocity credit sponsorship growth. Anticipate announcing two new credit sponsorship programs and the first embedded finance partner within the next six months, subject to customary implementation timelines. Guidance assumes a neutral interest rate position, with management expecting any Fed rate changes to have minimal impact on net interest income over a one-to-two quarter horizon. Future share repurchases are forecast to reach nearly 100% of annual net income, targeting annual EPS accretion of 5% to 10% from buybacks alone. A change in customer billing cycles and payment due dates with a lending partner caused a temporary dip in period-end loan balances, though management clarified this has no impact on economics or customer performance. The Aubrey OREO asset has reached over 70% occupancy with an appraisal value significantly above the bank's basis; stabilization and potential exit are expected by Q1 2027. Management addressed the risk of partners seeking their own bank charters, arguing that The Bancorp's $100 million+ infrastructure investment and 'halo effect' of cross-program fraud data create a prohibitive barrier to entry for partners to move in-house. Net deposits swept off-balance sheet reached $1.1 billion, providing a liquidity lever that can be pulled back to fund growth or optimize revenue as needed. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management explained the period-end balance decline was a one-time 1-day acceleration of payment due dates to align with customer terms. Average balances remain the primary indicator of economic performance due to the short-term nature of fintech lending products. CEO Damian Kozlowski emphasized that replicating The Bancorp's middle-office and regulatory tech stack would take 3-5 years and cost significantly more than their current service fees. Management noted that even if partners obtain charters, they may still use The Bancorp for origination and compliance while using their own balance sheets to hold the resulting loans. NII is expected to remain relatively flat for the second half of 2026 as the bank maintains an interest rate neutral position. Traditional NIM may see slight compression due to the mix shift toward fintech lending, but this is expected to be offset by higher fintech fee revenue. AI is currently being used to automate narrative writing for financial crimes compliance, allowing the bank to handle 4-6x market growth in GDV without increasing staff. Management views AI as a core driver for maintaining a 41% efficiency ratio while scaling the Apex 2030 strategy.

Interested in The Bancorp, Inc.? Here are five stocks we like better. Record earnings and higher guidance: Bancorp’s Q2 2026 EPS rose 14.2% year over year to $1.45, while management raised full-year EPS guidance to $5.95–$6.05. The company plans approximately $200 million in share repurchases during 2026. Fintech expansion is accelerating: Fintech gross dollar volume increased 22.5% and fintech revenue rose 21% year over year. The Cash App program is ramping, with more significant contributions expected in late Q4 2026 and Q1 2027, alongside potential new credit-sponsorship and embedded-finance programs. Loan growth and operating leverage remain key drivers: Average loans grew 16% year over year, fintech loans reached 18% of the portfolio, and deposit costs declined. Management also highlighted strong credit quality, AI-driven productivity gains and a 41% efficiency ratio, though traditional net interest income may remain roughly flat in the second half of 2026. Should The Bancorp Make Your Small-Cap Watchlist for 2023? Bancorp (NASDAQ:TBBK) reported second-quarter 2026 earnings per share of $1.45, up 14.2% from a year earlier, as growth in its fintech business, lending fees and operating leverage supported record earnings for the first half of the year. Chief Executive Officer Damian Kozlowski said the company generated a 34.7% return on equity in the quarter and expects further increases over the next three years. He said Bancorp intends to continue returning capital through share repurchases, forecasting $200 million of buybacks in 2026, or about $50 million per quarter. → Why SK hynix Could Be the Best AI Chip Stock to Buy Now The company raised its full-year 2026 earnings outlook to $5.95 to $6.05 per share. It also set a fourth-quarter target of $1.65 to $1.75 per share and maintained preliminary 2027 guidance of $8.10 to $8.30 per share. The guidance includes the anticipated effect of share repurchases. Fintech gross dollar volume, or GDV, increased 22.5% year over year in the second quarter, while fintech revenue, including fee and spread revenue, rose 21%, Kozlowski said. He cited continued onboarding of new programs and expansions with existing partners across the company’s fintech platform. → Microsoft Just Flipped the AI Spending Narrative Overnight Kozlowski said the Cash App program had begun ramping and should contribute to GDV growth and profitability in coming quarters, with more material contributions expected in late fourth-quarter 2026 and the first quarter of 2027. He said current GDV growth remained broad-based across the company’s verticals, including virtual cards, neobanks, virtual wallets, healthcare and corporate payments, with Cash App accounting for little of the reported growth so far. The company also expects to announce two additional credit-sponsorship programs that could come online within six months, subject to implementation timing and customary factors. Kozlowski described the prospective programs as higher-velocity lending products that would not use the balance sheet in the same way as the company’s Chime relationship. → Carrier Earnings Could Send the Stock to a New All-Time High In addition, Bancorp said development of its embedded-finance platform was progressing and that it expects to soon announce its first embedded-finance partner. Chief Financial Officer Dominic Canuso said average loans rose 5% from the first quarter, on a nonannualized basis, to $7.63 billion, and increased 16% from the prior-year quarter. Average fintech loans totaled $1.39 billion, or 18% of average total loans, compared with 15% in the first quarter and 8% a year earlier. Ending loan balances declined sequentially, but Canuso said the change stemmed from a one-time acceleration of a payment due date associated with a lending partner. The adjustment aligned payment timing with customer terms and conditions and did not change customer performance, contractual terms or Bancorp’s economics, he said. Management said average balances were a better measure of the business’s underlying economic trajectory, although ending balances should align with average-balance changes going forward. Bancorp continues to target a shift in loan mix toward higher-velocity, higher-returning credit-sponsorship lending. Canuso said the company was still working toward approximately $2 billion in fintech loan balances by year-end, though the result could vary depending on the timing and velocity of new programs. Average deposits rose $97 million, or 1.2% from the first quarter, and increased $357 million, or 4.4%, from a year earlier. The average cost of deposits fell seven basis points sequentially to 1.63%, 55 basis points below the year-earlier level. The company ended the quarter with $1.1 billion in deposits swept off its balance sheet. That figure was down 16% from the first quarter due to seasonality but up 32% from year-end 2025. Canuso said the company expects off-balance-sheet sweeps to increase over time despite potential quarterly fluctuations. Net interest margin was 3.85%, relatively unchanged from the first quarter. Fintech lending fees, which are recognized in fee revenue, equated to an additional 28 basis points of margin, up from 24 basis points in the prior quarter and 18 basis points a year earlier. Canuso said net interest income should be roughly flat during the second half of 2026, with some traditional margin compression expected as fintech lending becomes a larger portion of the mix. Noninterest income excluding credit enhancement rose 8.2% sequentially, on a nonannualized basis, and 16.7% year over year to $47.3 million. Fintech fees accounted for 29.7% of total revenue, up one percentage point from the first quarter and four percentage points from the second quarter of 2025. Credit performance remained strong across asset classes, management said. Real estate bridge loan criticized loans declined by $13 million, or 22%, to $46 million, the lowest level since mid-2023. Excluding fintech credit-sponsorship loans supported by full credit enhancement, the traditional lending portfolio recorded a $0.4 million provision during the quarter. Noninterest expense totaled $56.5 million, producing an efficiency ratio of 41%. Kozlowski said investments in artificial intelligence were helping employees handle increasing payment volume and improve productivity, including through AI-supported financial-crimes narrative writing. He said the company expects AI tools, restructuring efforts and fintech platform scale to support expense control and operating leverage. Management also discussed the potential for fintech partners to pursue bank charters, arguing that Bancorp’s scalable compliance, technology and middle-office infrastructure could continue to provide value even to partners with their own charters. Kozlowski said the company has invested hundreds of millions of dollars over roughly a decade in its platform and regulatory capabilities. On its real estate-owned Aubrey asset, Kozlowski said occupancy had surpassed 70% and the property was approaching stabilization. He said Bancorp expects the project to be completed in the first quarter, when it should move from break-even to profitability as occupancy improves further. The Bancorp, Inc (NASDAQ: TBBK) is a Delaware-chartered bank holding company that provides a range of banking and financial services to individuals, businesses, and financial institutions across the United States. Through its subsidiary, The Bancorp Bank, the company offers FDIC-insured deposit accounts, cash management solutions and specialized lending products. Its business model focuses on partnering with fintech firms, asset managers and payment processors to deliver integrated banking-as-a-service (BaaS) capabilities. The company's product suite includes interest-bearing and non-interest-bearing checking accounts, money market accounts, certificates of deposit and debit and credit card services. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Bancorp Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for July 2026.

This article first appeared on GuruFocus. Release Date: July 31, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. The Bancorp Inc (NASDAQ:TBBK) reported strong second-quarter earnings of $1.45 per share, a 14.2% year-over-year increase, with ROE reaching 34.7%, significantly above the industry average. Fintech GDV grew 22.5% year-over-year, with fintech revenue (fees and spread) up 21%, driven by broad-based growth across multiple verticals. The company raised its full-year 2026 EPS guidance to $5.95-$6.05 and reiterated its preliminary 2027 guidance of $8.10-$8.30, reflecting confidence in future growth. The Cash App program is ramping up and is expected to contribute materially to GDV and profitability in late Q4 2026 and Q1 2027, adding a significant new growth driver. The company maintains a strong capital return program, having returned 100% of its equity capital base over the last 4.5 years and forecasting future buybacks near 100% of annual net income, which should drive 5-10% annual EPS accretion. Credit quality improved, with criticized rebel loans down 22% to $46 million, the lowest level since mid-2023, and the traditional lending portfolio saw minimal provision expense. The company is making significant progress on its embedded finance platform and expects to announce its first partner soon, which could open new revenue streams. Management expects to announce two new credit sponsorship programs in the next six months, which should further accelerate fintech loan growth and fee income. The company is leveraging AI tools to improve productivity and manage expenses, contributing to a strong efficiency ratio of 41% and positive operating leverage. The Bancorp Inc (NASDAQ:TBBK) maintains a stable, low-cost deposit base with 95% of deposits from fintech partners and FDIC insured, and its average cost of deposits decreased to 1.63%. Ending loan balances decreased from the first quarter due to a one-time change in the customer billing cycle and payment due dates with a lending partner, which could cause short-term balance sheet volatility. The company's NIM is expected to compress as it shifts its loan mix towards higher-velocity, lower-yielding fintech credit sponsorship loans, although this is partially offset by fee income. The contribution from the Cash App program has been delayed, with material impacts now expected in late Q4 2026 and Q1 2027, rather than earlier in the second half of 2026. The company faces potential competitive pressure as some prominent fintech partners have applied for or indicated interest in obtaining their own bank charters, which could alter future partnership dynamics. There is inherent uncertainty and variability in the timing of new program launches and their phasing, which could impact the ability to hit the higher end of the 2027 EPS guidance range. The company took on additional short-term debt in the second quarter to manage liquidity and seasonal deposit outflows, which could increase funding costs if not managed carefully. The rebel portfolio, while improving, still carries risk, and a significant portion of loans are expected to mature within the next 12 months, requiring successful refinancing or extension to avoid credit issues. The company's heavy reliance on a few large fintech partners, such as Chime, creates concentration risk, and any disruption in these relationships could materially impact financial performance. While the company is investing in AI, there is a risk that these initiatives may not deliver the expected productivity gains or cost savings as quickly as anticipated. The company's aggressive share repurchase program, while accretive, reduces the capital base and could limit flexibility for future organic growth or unexpected opportunities. Warning! GuruFocus has detected 1 Warning Sign with TBBK. Is TBBK fairly valued? Test your thesis with our free DCF calculator. Q: Can you provide more detail on the payment timing dynamic that impacted period-end fintech loan balances, and should we think of average balances as a better indicator of the underlying trajectory?A: Dominic Canuso (CFO): Average balances are more indicative of our economics due to the short-term nature of fintech lending. This was a one-time change where we accelerated the payment due date by one day to align with terms and conditions for the credit sponsorship product. There were no contractual changes, no impact on customer performance, and no changes to our economics. The ending balance is now normalized and will move in line with average balances going forward. Q: You mentioned expecting two additional sponsored lending programs to come online over the next couple of quarters. What are the characteristics of those programs, and will they be balance-sheet intensive like Chime?A: Damien Kozlowski (CEO): The new programs will be much higher velocity and less balance-sheet intensive than our Chime relationship. They will be very structured, with partners that are well-known, and will involve similar types of loan products but in different categories. They will be booked as fintech loans and may have some ancillary impact on GDV. Q: Can you walk us through the factors behind the change to the full-year 2026 EPS guidance and the reiterated 2027 outlook?A: Dominic Canuso (CFO): The change was minor and relates to honing in on the timing of the pipeline for new programs. We continue to anticipate a ramp-up in profitability from Q2 to Q4, which provides the step-off point to hit our 2027 target. The adjustment aligns with the phasing of onboarding and growth anticipated from those programs. Q: How should we think about the trajectory of NII and NIM going forward, and what is the potential impact of Fed rate hikes?A: Dominic Canuso (CFO): We manage to an interest rate neutral position, so Fed rate changes have a neutral impact over a quarter or two. NII should be flat to near-flat for the second half of the year. While the traditional NIM calculation may tick down due to the migration to fintech lending, when normalized for fintech lending fees, the equivalent NIM actually blended up a couple of basis points this quarter. Q: How much of the GDV acceleration is driven by Square, Cash App, and other new programs versus legacy ones? Is the Cash App contribution delayed?A: Damien Kozlowski (CEO): Cash App is a very large program that can produce significant incremental growth, but it's currently contributing less than 0.5% to GDV. The acceleration is very broad-based across most of our 15 verticals, including neobanks, virtual wallets, healthcare, and corporate payments. Cash App will have a meaningful impact on GDV as we approach the end of the year, with more material contributions in late Q4 and Q1 of 2027. Q: Some prominent partners have applied for bank charters. How could Bancorp still provide services to companies with an ILC or other charter, and what could those partnerships look like?A: Damien Kozlowski (CEO): We provide an incredibly scalable middle-office platform that is very expensive to replicate. The cost to build this infrastructure is enormous, and we are a small expense on our partners' financial lines. We bring scale, sophistication, and regulatory expertise that is hard to replicate. Dominic Canuso (CFO) added that if partners with charters want to hold loans, we see that as a potential benefitwe can originate and process loans through our compliance efficiencies, then off-balance-sheet them to the partner, which could be a net benefit. Q: Can you discuss the framework for monitoring fintech counterparties as sponsored lending becomes a larger part of the balance sheet?A: Damien Kozlowski (CEO): We deal with very large enterprises, many of which are public companies with significant disclosure. We go through a rigorous third-party risk management process, delving into their liquidity, business plans, metrics, and marketing spend. We get full disclosure of current financial position and future forecasts, which we test and monitor closely. We proactively disengage from programs early if they are not successful, before any impact occurs. Q: Can you provide an update on your AI initiatives and where you see the next opportunities for efficiency?A: Damien Kozlowski (CEO): AI improvements have been dramatic over the last year. We're using AI at the enterprise level to empower employees and increase productivity, and in specific use cases like financial crimes, where AI-powered narrative writing is making our people much more productive. This helps us manage headcount while growing GDV at 4-5 times the market rate. AI is embedded in our business and will have a dramatic impact on our ability to grow while controlling expenses. Q: The debt balance increased meaningfully. Can you share your thinking around funding the business with additional debt and if we should expect that to continue?A: Dominic Canuso (CFO): The year-over-year increase was from the strategic upsizing of debt issuance in late 2025 to repurchase shares, which has been accretive. The sequential increase was from short-term borrowings for liquidity management. We have significant funding flexibility: 95% of deposits are from fintech and FDIC insured, we have $1.1 billion in off-balance-sheet deposits we can pull back, and we expect deposit growth to outpace lending growth for the rest of the year. We don't expect to need additional long-term debt. Q: How much of the rebel portfolio do you expect to mature within the next 12 months, and will those loans be refinanced by external lenders or by you?A: Dominic Canuso (CFO): The rebel portfolio consists of 3-year structured loans with two 1-year extension options, so roughly a third of the portfolio churns each year. We don't see a credit or price cliff given the short-term nature and improving property values. Damien Kozlowski (CEO) added that we don't do new stabilized loanswhen projects are completed, sponsors typically refinance with agency or other banks. We generally accommodate extensions when sponsors want to wait for better interest rates or takeout strategies. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

ELMER, N.J., July 30, 2026--(BUSINESS WIRE)--ELMER BANCORP, INC. ("Elmer Bancorp" or the "Company") (OTCID: ELMA), the parent company of The First National Bank of Elmer (the "Bank"), announces its operating results for the three and six months ended June 30, 2026. For the three months ended June 30, 2026, Elmer Bancorp reported net income of $809,000, or $0.70 per average diluted common share, compared to $737,000, or $0.64 per average diluted common share for the three months ended June 30, 2025. For the six months ended June 30, 2026, net income totaled $1.409 million or $1.23 per average diluted common share compared to $1.816 million, or $1.59 per average diluted common share for the six months ended June 30, 2025. Net interest income for the three months ended June 30, 2026 totaled $4.261 million, an increase of $260,000 from $4.001 million in the second quarter of 2025. For the six months ended June 30, 2026, net interest income totaled $8.285 million compared to $7.782 million for the six-month period of 2025. This increase in net interest income is the result of higher interest and fees on loans and lower interest paid on deposits partially offset by lower income on our overnight investments. The loan loss provision was increased by $50,000 and $90,000 for the three and six months ended June 30, 2026 compared to an increase of $44,000 and $84,000 for the three and six months ended June 30, 2025. This adjustment was the result of the required loan loss calculation under the Current Expected Credit Loss ("CECL") model. Non-interest income for the three months ended June 30, 2026 was $22,000 higher than the same three-month period a year ago and $498,000 lower than the six-month period last year. Increases in the cash surrender value of Bank Owned Life Insurance ("BOLI") and higher service fee income accounted for the increase in the three-month period. The decrease in the six-month period was the result of the one-time "BOLI" payout of $530,000 received in the first quarter of 2025 partially offset by higher service fee income. Non-interest expenses were higher for the three and six months ended June 30, 2026 versus the prior year periods by $182,000 and $370,000, respectively. Increases in employment costs, occupancy and equipment costs and data processing costs were partially offset by lower professional fees. Elmer Bancorp’s total assets at June 30, 2026 totaled $407.8 million, an increase of $3.2 million from the June 30, 2025 level of $404.6 million. Loans totaled $335.1 million at June 30, 2026, an increase of $12.8 million from the June 30, 2025 total of $322.3 million. At June 30, 2026, the allowance for loan losses was 1.27% of total loans. Deposits totaled $365.2 million at June 30, 2026, compared to the June 30, 2025 total of $365.3 million, reflecting a decrease of $7.3 million in interest bearing deposits and an increase of $7.2 million in non-interest bearing deposits. Stockholders’ equity totaled $40.1 million at June 30, 2026. The book value per share at June 30, 2026 was $34.64 compared to $32.44 per share at June 30, 2025. The Bank met all regulatory capital requirements to be classified as a well-capitalized institution as of June 30, 2026. Brian W. Jones, President and Chief Executive Officer stated, "We are very pleased with our earnings performance for the second quarter mainly driven by our net interest income. Loans have increased $12.8 million year-over-year and our solid deposit base has remained stable. Current economic conditions remain somewhat uncertain with a measurable degree of volatility, but the bank remains strategically placed to manage evolving financial and economic developments. We continue to build shareholder equity while experiencing stable organic growth. We are very appreciative of the support of our loyal customers, shareholders and employees." The First National Bank of Elmer, a nationally chartered bank headquartered in Elmer, New Jersey, has a long history of serving the community since its beginnings in 1903. We are a community bank focused on providing deposit and loan products to retail customers and to small and mid-sized businesses from our six full-service branch offices located in Cumberland, Gloucester and Salem Counties, New Jersey, including our main office located at 10 South Main Street in Elmer, New Jersey. In addition to our branch offices, the bank also operates a loan production office ("LPO") located in Marlton, NJ to service our clients in Burlington County. Deposits at The First National Bank of Elmer are insured up to the legal maximum amount by the Federal Deposit Insurance Corporation ("FDIC"). For more information about Elmer Bank and its products and services, please visit our website at www.ElmerBank.com or call toll free 1-856-358-7000. Forward-Looking StatementsThis press release and other statements made from time to time by the Company’s management contain express and implied statements relating to our future financial condition, results of operations, credit quality, corporate objectives, and other financial and business matters, which are considered forward-looking statements. These forward-looking statements are necessarily speculative and speak only as of the date made, and are subject to numerous assumptions, risks and uncertainties, all of which may change over time. Actual results could differ materially from those expected or implied by such forward-looking statements. Risks and uncertainties which could cause our actual results to differ materially and adversely from such forward-looking statements include economic conditions affecting the financial industry: changes in interest rates and shape of the yield curve, credit risk associated with our lending activities, risks relating to our market area, significant real estate collateral and the real estate market, operating, legal and regulatory risk, fiscal and monetary policy, economic, political and competitive forces affecting our business, our ability to identify and address cyber-security risks, and management’s analysis of these risks and factors being incorrect, and/or the strategies developed to address them being unsuccessful. Any statements made that are not historical facts should be considered forward-looking statements. You should not place undue reliance on any forward-looking statements. We undertake no obligation to update forward-looking statements or to make any public announcement when we consider forward-looking statements to no longer be accurate because of new information of future events, except as may be required by applicable law or regulation. View source version on businesswire.com: https://www.businesswire.com/news/home/20260730314194/en/ Contacts Cynthia L. VolkExecutive Vice PresidentChief Financial Officer1-856-358-8141

The Bancorp (TBBK) came out with quarterly earnings of $1.45 per share, beating the Zacks Consensus Estimate of $1.36 per share. This compares to earnings of $1.27 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +6.62%. A quarter ago, it was expected that this holding company for The Bancorp Bank would post earnings of $1.34 per share when it actually produced earnings of $1.41, delivering a surprise of +5.22%. Over the last four quarters, the company has surpassed consensus EPS estimates two times. The Bancorp, which belongs to the Zacks Banks - Northeast industry, posted revenues of $163.51 million for the quarter ended June 2026, missing the Zacks Consensus Estimate by 1.91%. This compares to year-ago revenues of $181.24 million. The company has not been able to beat consensus revenue estimates over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. The Bancorp shares have added about 0.1% since the beginning of the year versus the S&P 500's gain of 6.9%. While The Bancorp has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for The Bancorp was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $1.42 on $167.68 million in revenues for the coming quarter and $5.95 on $678.77 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Banks - Northeast is currently in the top 21% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. StoneX Group Inc. (SNEX), another stock in the broader Zacks Finance sector, has yet to report results for the quarter ended June 2026. This company is expected to post quarterly earnings of $0.76 per share in its upcoming report, which represents a year-over-year change of +40.7%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. StoneX Group Inc.'s revenues are expected to be $1.32 billion, up 28.5% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report The Bancorp, Inc. (TBBK) : Free Stock Analysis Report StoneX Group Inc. (SNEX) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research