First Internet Bancorp Reports Third Quarter 2025 Results

"Our third quarter results demonstrated strong operational momentum with solid growth in net interest income and continued improvement in our net interest margin," said David Becker, CEO and Chairman of First Internet Bancorp. "We have now achieved eight consecutive quarters of increasing net interest income, attributable to higher yields on our earning assets and reduced funding costs, both of which have materially enhanced our operating efficiency. Additionally, we attained significant growth in fintech deposits, which has enabled us to maintain strong balance sheet liquidity, as evidenced by our favorable loans-to-deposits ratio. We also completed a major loan sale and moved deposits off balance sheet which will enhance our regulatory capital ratios and provide balance sheet flexibility."

"In the third quarter, we took decisive action to address credit issues in our small business lending and franchise finance portfolios, which provides us with a cleaner credit profile and sets the stage for improved performance in future quarters. Entering the fourth quarter, we see encouraging signs in both portfolios with asset quality improving and delinquencies at their lowest level in a year. Our loan pipelines remain robust, and we are now well-positioned to grow earnings and accelerate our ability to achieve a ROAA of 1%. I wish to express my sincere appreciation for the dedication and diligence of our team as we worked extremely hard this quarter to position the Company for success going forward and enhance shareholder value."

Key Business Update

• Revenue and Profitability Momentum
  Adjusted total revenue grew 30% sequentially, leading to adjusted pre-tax, pre-provision income of $18.1 million¹, up over 50% from the previous quarter. Net interest margin improved to 2.04%, with fully-taxable equivalent net interest margin of 2.12%¹.

• Proactive Credit Risk Management
  Company took decisive credit related actions that have resulted in notable progress in resolving problem loans as delinquencies have declined significantly. Additionally, the Company recognized a provision for credit losses of $34.8 million, primarily related to small business lending and franchise finance.

• Solid Capital Position
  Completed the previously announced sale of $836.9 million of single tenant lease financing loans which enhanced regulatory capital ratios and balance sheet flexibility. Regulatory capital ratios improved, with a Common Equity Tier 1 ratio of 9.24%, a Total Risk-Based Capital ratio of 13.11%, and a tangible common equity to tangible assets ratio of 6.17%.

Third Quarter 2025 Financial Performance

• Adjusted total revenue of $43.5 million¹ increased 30% from the prior quarter
• Net interest income of $30.4 million and fully-taxable net interest income of $31.5 million¹, both increasing 8%, from the second quarter of 2025
• Net interest margin of 2.04% and fully-taxable equivalent net interest margin of 2.12%¹, both increasing 8 basis points (“bps”), from the second quarter of 2025
• Adjusted pre-tax, pre-provision income (“PTPP”) of $18.1 million¹ increased 54% from the prior quarter
• Loan balances decreased $732.2 million, or 17%, from the second quarter of 2025
  • Excluding the impact of the loan sale, total loan balances increased $104.7 million, or 2.4%, from the second quarter of 2025
• Net loss of $41.6 million and diluted loss per share of ($4.76)
  • Quarterly results included a pre-tax loss of $37.8 million on the sale of the single tenant lease financing loans
• Excluding the impact of the loan sale, adjusted net loss was $12.5 million¹ and diluted loss per share was $1.43
• Deposits decreased $383.4 million, or 7%, reflecting over $700 million moved off-balance sheet; loans to deposits ratio of 73.9%
• Nonperforming loans to total loans of 1.47%; net charge-offs to average loans of 1.89%; allowance for credit losses to total loans of 1.65%
• Tangible common equity to tangible assets of 6.17%¹, and 7.20%¹ ex-AOCI and adjusted for normalized cash balances
• Tangible book value per share of $39.88¹, compared to $44.25 in the second quarter of 2025

¹ This information represents a non-GAAP financial measure. For a discussion of non-GAAP financial measures, see the section below entitled "Non-GAAP Financial Measures."

Conference Call and Webcast

The Company will host a conference call and webcast at 2:00 p.m. Eastern Time on Thursday, October 23, 2025, to discuss its quarterly financial results. The call can be accessed via telephone at (800) 549-8228; access code: 74806. A recorded replay can be accessed through October 30, 2025, by dialing (888) 660-6264; access code: 74806#.

Additionally, interested parties can listen to a live webcast of the call on the Company's website at www.firstinternetbancorp.com. An archived version of the webcast will be available in the same location shortly after the live call has ended.

About First Internet Bancorp

First Internet Bancorp is a bank holding company with assets of $5.6 billion as of September 30, 2025. The Company’s subsidiary, First Internet Bank, opened for business in 1999 as an industry pioneer in the branchless delivery of banking services. First Internet Bank provides consumer and small business deposit, SBA financing, franchise finance, consumer loans, and specialty finance services nationally as well as commercial real estate loans, construction loans, commercial and industrial loans, and treasury management services on a regional basis. First Internet Bancorp’s common stock trades on the Nasdaq Global Select Market under the symbol “INBK” and is a component of the Russell 2000® Index. Additional information about the Company is available at www.firstinternetbancorp.com and additional information about First Internet Bank, including its products and services, is available at www.firstib.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including statements with respect to the financial condition, results of operations, trends in lending policies and loan programs, plans and prospective business partnerships, objectives, future performance and business of the Company. Forward-looking statements are generally identifiable by the use of words such as “anticipate,” “believe,” “continue,” “could,” “drive,” “enhance,” “estimate,” “expanding,” “expect,” “future,” “going forward,” “growth,” ”improve,” “increase,” “looking ahead,” “maintain,” “may,” “ongoing,” “opportunities,” “pending,” “plan,” “position,” “preliminary,” “remain,” “setting the stage,” “should,” “stable,” “thereafter,” “well-positioned,” “will,” or other similar expressions. Forward-looking statements are not a guarantee of future performance or results, are based on information available at the time the statements are made and involve known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from the information in the forward-looking statements. Such statements are subject to certain risks and uncertainties including: our business and operations and the business and operations of our vendors and customers: general economic conditions, whether national or regional, and conditions in the lending markets in which we participate that may have an adverse effect on the demand for our loans and other products; our credit quality and related levels of nonperforming assets and loan losses, and the value and salability of the real estate that is the collateral for our loans. Other factors that may cause such differences include: failures or breaches of or interruptions in the communications and information systems on which we rely to conduct our business; failure of our plans to grow our commercial and industrial, construction, and SBA loan portfolios; competition with national, regional and community financial institutions; the loss of key members of senior management; the anticipated impacts of inflation and rising interest rates on the general economy; risks relating to the regulation of financial institutions; and other factors identified in reports we file with the U.S. Securities and Exchange Commission. All statements in this press release, including forward-looking statements, speak only as of the date they are made, and the Company undertakes no obligation to update any statement in light of new information or future events.

Non-GAAP Financial Measures

This press release contains financial information determined by methods other than in accordance with U.S. generally accepted accounting principles (“GAAP”). Non-GAAP financial measures, specifically tangible common equity, tangible assets, tangible book value per common share, tangible common equity to tangible assets, average tangible common equity, return on average tangible common equity, total interest income – FTE, net interest income – FTE, net interest margin – FTE, pre-tax, pre-provision (loss) income, adjusted pre-tax, pre-provision income, adjusted noninterest income, adjusted noninterest expense, adjusted (loss) income before income taxes, adjusted income tax (benefit) provision, adjusted net (loss) income, adjusted diluted (loss) earnings per share, adjusted return on average assets, adjusted return on average shareholders’ equity and adjusted return on average tangible common equity are used by the Company’s management to measure the strength of its capital and analyze profitability, including its ability to generate earnings on tangible capital invested by its shareholders. Although management believes these non-GAAP measures are useful to investors by providing a greater understanding of its business, they should not be considered a substitute for financial measures determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures are included in the table at the end of this release under the caption “Reconciliation of Non-GAAP Financial Measures.”