Newtek Business Services Corp. (NEWT): History, Ownership, Mission, How It Works & Makes Money

Do you really understand how a financial holding company like Newtek Business Services Corp. (now NewtekOne, Inc.) manages to be a one-stop shop for small- and medium-sized businesses across all 50 states?

This firm isn't just a lender; it's a full-stack digital partner, evidenced by its Year-to-Date 2025 pre-provision net revenue (PPNR) hitting approximately $85.8 million, a 39.1% jump year-over-year, showing serious growth in its core business. You need to know how they've achieved a 3Q25 Return on Average Tangible Common Equity (ROTCE) of 23.7% by combining banking, lending, and tech solutions into one platform, especially as they prepare for their largest-ever securitization of Alternative Lending Program loans in 4Q25. Let's dig into the history, mission, and mechanics that drive this kind of performance.

Newtek Business Services Corp. (NEWT) History

If you're looking at Newtek Business Services Corp., now NewtekOne, Inc., you need to understand its twenty-five-year journey from a specialized investment vehicle to a full-fledged financial holding company. The story is one of constant, strategic evolution, moving from a niche focus on Certified Capital Companies (Capcos) to owning a nationally chartered bank. This wasn't a linear path, but a series of calculated shifts to serve the small- and medium-sized business (SMB) market more comprehensively.

The biggest takeaway is that the company has fundamentally changed its business model twice, culminating in the 2023 bank acquisition, which dramatically altered its financial structure and growth potential. Honestly, the old Business Development Company (BDC) metrics are defintely less relevant now; you should focus on the new consolidated banking metrics like Return on Average Tangible Common Equity (ROTCE), which hit an impressive 23.7% in the third quarter of 2025.

Given Company's Founding Timeline

Year established

The company was founded in 1998 as Newtek Business Services, Inc. to capitalize on state-level Certified Capital Company (Capco) programs.

Original location

The original base of operations was in New York, NY. Filings from the Newtek Business Services Corp. era list the corporate address as 212 West 35th Street.

Founding team members

The key driving force and long-time leader of the company is Barry Sloane, who serves as the Chairman, President, and Chief Executive Officer.

Initial capital/funding

Initial capital came from seed money provided by organizers like Newtek, but the core funding mechanism involved the Capco programs. These programs saw the Capcos issue debt and equity to insurance companies, generating substantial capital. For perspective, approximately $70.1 million in Capco debt was repaid in 2009 alone, illustrating the scale of the early funding structure.

Given Company's Evolution Milestones

Given Company's Transformative Moments

The company's trajectory is defined by two major, deliberate restructurings aimed at optimizing capital and regulatory efficiency. The initial focus on Capcos, which are Certified Capital Companies, provided the early investment platform, but that model was phased out as investment requirements were met.

The most crucial shift was the move to a bank-centric model in 2023. This was a game-changer for capital deployment, allowing the company to retain more earnings and operate with a more stable, lower-cost funding source-deposits-instead of relying on high-cost commercial funding and BDC debt.

• 2014 BDC Conversion: Electing BDC status allowed the company to raise capital more easily and distribute most of its income as dividends, attracting a specific investor base.
• 2023 Bank Acquisition: Acquiring a national bank and becoming a financial holding company eliminated the BDC requirement to distribute 90% of taxable income, allowing the company to retain capital for internal growth.
• Technology Integration: The rollout of the Newtek Advantage platform, a proprietary technology, was critical, enabling cost-effective customer acquisition and cross-selling of services like lending, payment processing, and payroll.
• 2025 Financial Strength: Year-to-date 2025 net income before taxes reached approximately $55.5 million, a 23.5% increase over the prior year, showing the new model's financial leverage.

If you want to dive deeper into who is investing in this new structure, you should read Exploring Newtek Business Services Corp. (NEWT) Investor Profile: Who's Buying and Why?

Newtek Business Services Corp. (NEWT) Ownership Structure

The company, now officially NewtekOne, Inc., operates as a publicly traded financial holding company, a significant shift from its former structure as a Business Development Company (BDC). This structure means its ownership is dispersed among institutional investors, company insiders, and the public, with a clear regulatory framework governing its operations as the parent of Newtek Bank, National Association.

NewtekOne, Inc.'s Current Status

You need to know that the corporate entity you're analyzing is no longer Newtek Business Services Corp., but NewtekOne, Inc. (NASDAQ: NEWT). This change became official in January 2023, following the acquisition of National Bank of New York City and the conversion to a financial holding company (FHC). This new status means the company is regulated differently and consolidates its bank and non-bank subsidiaries in its financial statements, shifting the focus to after-tax net income instead of the BDC metrics like Net Investment Income.

The company remains publicly traded on the NASDAQ, retaining the ticker symbol NEWT. It's a hybrid model, combining a nationally chartered bank, Newtek Bank, N.A., with a technology-enabled platform for small- and medium-sized businesses (SMBs). The company is defintely unique in the banking space because it primarily uses a digital, non-branch model to acquire clients and deposits.

For a deeper dive into the numbers, you should check out Breaking Down Newtek Business Services Corp. (NEWT) Financial Health: Key Insights for Investors.

NewtekOne, Inc.'s Ownership Breakdown

As of the 2025 fiscal year data, institutional investors hold the largest block of shares, which is typical for a publicly traded financial company. This concentration means large asset managers and pension funds have a substantial say in governance and strategy.

Here's the quick math: Institutional ownership sits near the halfway mark at 46.7%, while insider holdings are a focused 7.13%. The remaining 46.17% is held by the general public, including you and other individual investors. This insider stake is small, but it's enough to keep the executive team directly invested in the stock's performance and the company's long-term success.

NewtekOne, Inc.'s Leadership

The company is steered by a veteran leadership team, many of whom have been with the organization for decades, guiding it through the major transition from a BDC to a financial holding company. The core leadership is focused on the dual mandate of banking and technology services for the SMB market.

• Barry Sloane: President, Chairman, and Chief Executive Officer of NewtekOne, Inc., and Newtek Bank, National Association. He is the founder and primary architect of the company's unique business model.
• Frank M. DeMaria: Chief Financial Officer of NewtekOne, Inc., the publicly traded holding company.
• Scott Price: Chief Financial Officer of Newtek Bank, National Association. His focus is on the bank's capital ratios and deposit growth.
• Peter Downs: President of Newtek Small Business Finance, Chief Lending Officer, and Director. He's a 22-year company veteran, crucial for the SBA lending segment.
• Justine Martin: Chief Revenue Officer of Newtek Merchant Solutions, hired in November 2025, bringing over 30 years of payments processing experience. This hire signals a push to improve integration across the payments, banking, and lending functions.

The leadership structure is designed to manage the complexity of a financial holding company that owns a bank, ensuring regulatory compliance while driving growth in its non-bank services like payment processing, which is expected to contribute $16.5 million of pretax income in the 2025 fiscal year.

Newtek Business Services Corp. (NEWT) Mission and Values

Newtek Business Services Corp. (now operating as NewtekOne, Inc.) centers its mission on being the essential, single-source financial and business solution for independent business owners, which is the cultural DNA that drives its growth strategy.

The company's core values-Professionalism, Customer Fixation, Teamwork, and Innovation-are the pillars supporting its goal to help small- and medium-sized businesses (SMBs) across the US grow sales and manage risk, a strategy that yielded a 3Q25 Return on Average Tangible Common Equity (ROTCE) of 23.7%.

Newtek Business Services Corp.'s Core Purpose

You're looking past the stock ticker to understand the company's long game, and honestly, the mission is simple: be the one-stop digital partner for the backbone of the US economy-the independent business owner. This focus is why the firm is a top-tier Small Business Administration (SBA) lender, projecting $1 billion in SBA 7(a) originations for 2025.

Official Mission Statement

The mission is to provide a comprehensive suite of business and financial solutions to independent business owners to help them grow their sales, control their expenses, and reduce their risk.

This isn't corporate fluff; it's a structural commitment. They aim to replace the disconnected products and outdated workflows that plague SMBs with a single, real-time platform, the Newtek Advantage.

• Provide state-of-the-art, cost-efficient products.
• Deliver efficient business strategies to SMBs across all 50 states.
• Act as a financial holding company with both bank and non-bank subsidiaries.

Vision Statement

While NewtekOne doesn't publish a single, formal vision statement, its strategic moves and CEO commentary clearly map out a long-term goal: to be the financial institution of the future for independent business owners.

The vision is to use its technology-enabled platform to achieve industry-leading profitability and scale, like its goal to have its Alternative Loan Program (ALP) surpass its flagship SBA 7(a) lending in size. Here's the quick math: the company is maintaining a 2025 GAAP EPS target range of $2.10 to $2.50, a clear sign of confidence in this growth trajectory.

• Be the single, real-time solution for all client transactions and analytics.
• Expand the technology-enabled platform to support balance sheet growth well in excess of the banking industry average.
• Achieve a broader revenue stream, reducing reliance on any single business line.

If you want to dig into how this vision translates to the balance sheet, you should check out Breaking Down Newtek Business Services Corp. (NEWT) Financial Health: Key Insights for Investors.

Newtek Business Services Corp. Slogan/Tagline

The company uses a few taglines that capture its positioning in the market, all of which reflect its core purpose of consolidation and service for the SMB client.

• Your Business Solutions Company®
• One Solution for All Your Business Needs®
• We Do It Better™

The 'One Solution' tagline is defintely the most descriptive of the firm's strategy, especially since its 3Q25 total revenue hit $74.9 million, up 19.3% year-over-year, showing that the consolidated solution approach is working.

Newtek Business Services Corp. (NEWT) How It Works

Newtek Business Services Corp., now operating as NewtekOne, Inc., functions as a technology-driven financial holding company that owns and operates a nationally chartered digital bank, Newtek Bank, N.A.. It delivers an integrated suite of business solutions-banking, lending, payments, and technology-to small and medium-sized businesses (SMBs) across the US, acting as a single, centralized financial partner.

NewtekOne's Product/Service Portfolio

NewtekOne targets a vast market of over 33 million independent business owners in the U.S., offering a comprehensive, one-stop-shop approach to business finance and operations. The portfolio is designed to help SMBs grow sales, control expenses, and reduce risk.

NewtekOne's Operational Framework

The company's operational framework is built on a 'digital-first' model, which allows it to acquire and service customers far more cost-effectively than traditional financial institutions. This efficiency is a core driver of its strong profitability metrics; for example, the efficiency ratio improved to 56.3% in 3Q25.

• Digital Customer Acquisition: Uses proprietary, patented advanced technological solutions to reach and onboard customers remotely and digitally, keeping customer acquisition costs low.
• Integrated Ecosystem: The digital bank and non-bank subsidiaries (lending, payments, tech) are consolidated, allowing a single customer relationship to generate multiple revenue streams (cross-selling).
• Lending Capital Velocity: For SBA 7(a) loans, NewtekOne quickly sells the government-guaranteed portion and often securitizes the unguaranteed portion, allowing it to recover principal and generate capital rapidly for new originations.
• Deposit Funding Advantage: The digital bank structure enables the company to acquire business deposits at a cost below the risk-free rate, which lowers the overall cost of funds for its lending operations.

Here's the quick math: the operational leverage is clear when you see the year-over-year growth in loans and deposits, which increased approximately 58% and 81%, respectively, comparing 3Q25 to 3Q24.

NewtekOne's Strategic Advantages

NewtekOne's market success hinges on its ability to offer a cohesive, high-value solution set that competitors, often siloed banks or specialized fintechs, struggle to match. They defintely own the 'one-stop-shop' narrative for SMBs.

• The Newtek Advantage: A proprietary, single online dashboard where clients can manage all their business needs-banking, payments data, payroll, and analytics-providing instant data access for smarter decision-making.
• Financial Holding Company Structure: The transformation from a Business Development Company (BDC) to a financial holding company with Newtek Bank, N.A. provides stability, a lower cost of capital, and a regulated platform for deposit gathering and lending.
• Guaranteed Savings Proposition: A concrete promise to beat a client's existing payment processing, payroll, or technology solution rate, or provide a $100 gift card, which is a powerful, risk-free incentive for new customer adoption.
• High Return Metrics: The business model delivers exceptional shareholder value; the Return on Average Tangible Common Equity (ROTCE) for 3Q25 was an impressive 23.7%.

If you want to dig deeper into the numbers behind these operations, you should review Breaking Down Newtek Business Services Corp. (NEWT) Financial Health: Key Insights for Investors.

Newtek Business Services Corp. (NEWT) How It Makes Money

Newtek Business Services Corp., now operating as NewtekOne, Inc., makes money by functioning as a technology-enabled financial holding company that provides a full suite of business and financial solutions to independent business owners, primarily through a digital-only bank and its non-bank subsidiaries. Their model is a hybrid: they earn traditional bank income from interest on loans and deposits, plus significant non-interest income from selling the guaranteed portions of Small Business Administration (SBA) loans, securitizing their Alternative Loan Program (ALP) loans, and offering fee-based services like electronic payment processing, payroll, and insurance.

Given Company's Revenue Breakdown

The company's revenue engine in the 2025 fiscal year is heavily weighted toward non-interest income, which includes gains on loan sales and a growing suite of fee-based services. This structure is intentional, allowing them to capture higher margins outside of traditional banking limitations. Based on the Q3 2025 financial results, total revenue (Net Interest Income plus Total Noninterest Income) was approximately $74.9 million.

Here's the quick math on the largest component: Net Gain on Loans, which includes the net gain on loans accounted for under the fair value option (primarily Alternative Loan Program or ALP loans) at $29.250 million and net gains on sales of loans (primarily SBA 7(a) loans) at $9.563 million for Q3 2025. This core lending and securitization activity drives over half of the revenue.

Business Economics

Newtek Business Services Corp.'s economic fundamentals are built on a low-cost, high-margin digital model that bypasses the expense of a traditional branch network. This is how they maintain a competitive edge and drive profitability.

• Low-Cost Customer Acquisition: They use proprietary technology and a vast referral network to acquire small- and medium-sized business (SMB) customers remotely, avoiding the high overhead of traditional bankers and physical branches.
• Integrated, Sticky Deposits: The company acquires business deposits, which are typically less expensive, by integrating them with essential services like payment processing and payroll through the 'Newtek Advantage' platform. This strategy helps them gather deposits below the risk-free rate.
• High-Margin Loan Securitization: A key driver is the Alternative Loan Program (ALP), which involves making larger, higher-quality loans and then packaging and selling them as securitizations to institutional investors. This creates a large, repeatable, non-interest income stream-a gain on sale-that generates a high return on equity. They are expecting their largest ALP securitization to date in Q4 2025, projected to range from $325 million to $350 million.
• Operating Leverage: The efficiency ratio at the holding company improved significantly, declining from 61.8% to 56.3% in Q3 2025, even as total assets surged by 43%. This shows they are scaling revenue much faster than operating expenses.

To be fair, this model also carries a higher level of non-performing loans (NPLs) and provisions for credit losses compared to a standard community bank, but the company manages this risk and remains extraordinarily profitable on a net basis.

Given Company's Financial Performance

The company demonstrated strong financial growth throughout the 2025 fiscal year, with key metrics indicating above-average profitability and efficient capital deployment. The conversion to a financial holding company with a digital bank has clearly bolstered their balance sheet and earnings power.

• Earnings Per Share (EPS): Diluted EPS for Q3 2025 was $0.67, reflecting a year-over-year increase of 47%. The company's full-year 2025 EPS forecast midpoint is $2.30.
• Tangible Book Value Growth: Tangible book value per share saw tremendous growth, rising from $6.92 per share in Q1 2023 to $11.22 per share by Q3 2025. That's a defintely solid increase.
• Bank Profitability: Newtek Bank, N.A. reported a robust Return on Average Assets (ROAA) of 3.57% and a Return on Tangible Common Equity of 32% in Q3 2025, both well ahead of industry averages. The Net Interest Margin (NIM) was also high at 5.4%.
• Service Subsidiary Contribution: The Newtek Merchant Solutions subsidiary alone is expected to contribute approximately $16.5 million in pretax income for the full 2025 fiscal year, highlighting the value of the non-bank service businesses.

If you want to dig deeper into the institutional interest and ownership structure, you should check out Exploring Newtek Business Services Corp. (NEWT) Investor Profile: Who's Buying and Why?

The total assets as of Q3 2025 stood at over $2.399 billion, supported by total deposits of over $1.177 billion. This strong capital position supports continued loan and deposit growth. Finance: review the Q3 2025 10-Q for the full breakdown of noninterest revenue components by next Tuesday.

NewtekOne, Inc. (NEWT) Market Position & Future Outlook

NewtekOne, Inc. is positioned as a top-tier digital financial holding company for small- and medium-sized enterprises (SMEs), rapidly scaling its deposit and loan base while leveraging its technology platform to drive superior profitability metrics in 2025. The company's full-year 2025 diluted earnings per share (EPS) guidance is a strong signal of confidence, projected to be between $2.10 and $2.50, a significant growth trajectory supported by its unique, diversified business model.

Competitive Landscape

In the small business lending arena, especially the government-guaranteed SBA 7(a) program, NewtekOne, Inc. is a dominant force, ranking consistently in the top three nationally by dollar volume. This market is highly fragmented, but the top lenders capture a disproportionate share, which is why Newtek's position is defintely a core advantage.

Opportunities & Challenges

The company is capitalizing on its transition to a financial holding company, which allows it to fund loans with lower-cost deposits, but it must navigate a challenging credit environment and manage the wind-down of its legacy non-bank lending unit.

Industry Position

NewtekOne, Inc.'s core strength lies in its ability to generate high profitability compared to traditional banking peers, a direct result of its 'FinTech-meets-Bank' model. For the nine months ended September 30, 2025, the company reported basic EPS of $1.57 on total revenue of $211.5 million. This model is built on cross-selling a full menu of business solutions-lending, payments, payroll, insurance, and technology-to a single customer base of independent business owners.

• Profitability Edge: The bank subsidiary's Return on Average Assets (ROAA) and Return on Tangible Common Equity (ROTCE) are significantly above the peer average, demonstrating efficient capital deployment.
• Balance Sheet Strength: Loans and deposits saw massive year-over-year increases as of Q3 2025, up approximately 58% and 81%, respectively, bolstering the balance sheet for future growth.
• Strategic Focus: The company's projected 2025 total business loan originations of $1.9 billion, a 36% increase over 2024, reflects a strategic shift toward higher-growth, higher-yield Alternative Loan Program (ALP) and Commercial Real Estate (CRE)/Commercial & Industrial (C&I) loans to diversify away from its SBA concentration.
• Digital Moat: Acquiring Newtek Bank National Association allows NewtekOne to offer depository solutions and real-time payments, creating a 'moat' around its business that is difficult for pure-play lenders to replicate. You can read more about the foundation of this strategy in the Mission Statement, Vision, & Core Values of Newtek Business Services Corp. (NEWT).

The consistent growth in tangible book value per share, which reached $11.22 in Q3 2025, shows that the underlying value of the business is increasing, even as they manage the complexity of their business transformation. Finance: Monitor NSBF loss trend and ALP securitization execution in Q4 for full-year EPS confirmation.