NewtekOne's Digital Edge: High Returns in a Branchless Banking Model

BOCA RATON, FL – December 01, 2025 – In an era where digital transformation is not just an advantage but a necessity, some firms are moving beyond theory and putting radical new models into practice. NewtekOne, Inc. stands out as a compelling case study, demonstrating how a technology-centric, branchless banking strategy can deliver returns that rival and even exceed those of its brick-and-mortar counterparts. With recent announcements confirming strong financial footing and bold capital maneuvers, the company is not just navigating the future of financial services—it appears to be building it.

As the company approaches the three-year anniversary of its transition to a financial holding company, it has provided a fourth-quarter update that underscores the success of its digital-first philosophy. By reaffirming its robust 2025 earnings guidance and announcing its largest-ever loan securitization, NewtekOne is signaling profound confidence in its unique operational blueprint, setting the stage for what could be a pivotal 2026.

The Digital-First Banking Blueprint

At the heart of NewtekOne's strategy is a conscious rejection of the traditional banking infrastructure. The company operates as a “technology-oriented digital bank,” a model that CEO Barry Sloane believes makes it “unlike most, if not all, publicly traded bank holding companies” of its size. This isn't just rhetoric; the operational data paints a clear picture of a successful digital-first ecosystem. Since its transition, NewtekOne has digitally opened nearly 30,000 deposit accounts, a feat achieved without a single physical branch.

The engine driving this growth is the Newtek Advantage®, a comprehensive platform offering a suite of business and financial solutions. This single-source portal provides independent business owners with access to banking, lending, payment processing, insurance, payroll, and even technology consulting. The goal, as the company states, is to create a “frictionless environment” where clients can access a full menu of solutions designed to help them grow sales, control expenses, and mitigate risk.

This model's efficiency is striking. In the third quarter of 2025, NewtekOne reported a sequential increase in business deposits by $52 million (17%) and consumer deposits by $95 million (12%). This growth was achieved organically through its digital platform, without relying on the high overhead costs associated with branches, commercial bankers, or traditional business development officers. By leveraging “software, people, and process,” the company is proving that customer acquisition and service in the small business sector can be effectively scaled through technology.

Translating Digital Strategy into Financial Performance

The most compelling validation of any business strategy lies in its financial results, and here NewtekOne is making a powerful statement. The company reaffirmed its full-year 2025 EPS guidance of $2.10 to $2.50. This projection is backed by strong quarterly performance, with year-to-date diluted EPS reaching $1.54 through the third quarter, indicating the company is well on its way to meeting its target.

Even more telling are the firm’s profitability metrics. NewtekOne projects a return on assets (ROA) of approximately 3% and a return on tangible common equity (ROTCE) of around 20% for the full year. However, its third-quarter results already surpassed these ambitious targets, with an annualized ROAA of 3.06% and a remarkable ROTCE of 23.7%. These figures are exceptionally high for the banking industry and are a direct result of the operational leverage gained from its technology-driven, low-overhead model. By eliminating the fixed costs of a physical footprint, the company can generate superior returns on its assets and equity, a key differentiator for investors.

This performance is particularly notable given the recent economic uncertainties, including a government shutdown that temporarily halted sales of government-guaranteed portions of its SBA 7(a) loans. The company’s ability to absorb this disruption and confidently reiterate its guidance speaks to the resilience and diversification of its business model.

Strategic Capital Maneuvers Signal Confidence

Beyond its strong operational performance, NewtekOne is engaging in sophisticated financial strategies that signal deep confidence from its management team. The company announced it will launch its largest-ever securitization of its Alternative Loan Program (ALP) loans this month. This transaction, its 17th securitization overall, involves bundling these loans and selling them to investors as rated notes.

This move serves multiple strategic purposes. It allows NewtekOne to convert long-term assets into immediate liquidity, better matching its assets and liabilities while optimizing its balance sheet for future lending. The market's appetite for these assets appears strong; a recent ALP securitization yielded a favorable spread of 568 basis points, showcasing the company's ability to execute these complex transactions efficiently and profitably. This ongoing securitization program is a core pillar of its capital management strategy, enabling sustained growth without being overly constrained by its deposit base.

In addition to securitization, NewtekOne has been actively repurchasing its own shares. Quarter-to-date, it has bought back over 100,000 shares at an average price of $10.20. Share buybacks are often interpreted as a signal that a company's leadership believes its stock is undervalued. It is a direct and tax-efficient way to return capital to shareholders and reflects a conviction in the company’s long-term value proposition.

A Look Ahead: The 2026 Vision

With a proven digital model and a track record of strong execution, all eyes are now turning to the future. NewtekOne has scheduled an Investor and Analyst Day for January 8, 2026, at its Boca Raton headquarters. At this event, the company is expected to unveil its operational and financial goals for the coming year. For investors and industry watchers, this will be a crucial moment to gauge the next phase of NewtekOne's growth.

Key questions will revolve around the continued evolution of the Newtek Advantage® platform, potential integration of more advanced AI and data analytics to enhance its offerings, and the specific financial targets for 2026. After demonstrating what its technology-oriented bank can achieve, the market will be keen to understand how NewtekOne plans to scale its operations and cement its position as a dominant force in the financial technology landscape for independent businesses. The company's journey offers a clear lesson: in the digital age, a bank's value may be measured less by the number of its branches and more by the strength of its code.