On this page of StockholderLetter.com we present the latest annual shareholder letter from Live Oak Bancshares, Inc. — ticker symbol LOB. Reading current and past LOB letters to shareholders can bring important insights into the investment thesis.
Live Oak Bancshares 2025 ANNUAL REPORT
LETTER FROM THE CHAIRMAN To Our Shareholders, If there was a theme to 2025, it was resiliency. Last year was marked by economic uncertainty, rising costs, regulatory shifts, and competitive pressures. Our customers dug deep with surprising optimism, determination, and grit and so did we. When the world was facing unease, our focus was to Keep the Main Thing the Main Thing. I am pleased with our performance. Our small business team had a record year of loan growth. Our commercial banking team continued to expand up-market in deposit rich verticals. Our deposit team continued to deepen wallet share, and our two strategic initiatives Live Oak Express and business checking continued positive momentum. Live Oak Express, our small dollar SBA 7(a) loan production, nearly doubled with 94% growth from the previous year. Business checking had a similar trajectory as 22% of our customers have both loan and deposit accounts, up 57% from the prior year. 9 LIVE OAK | MOMENTUM BUILDING ACROSS CORE STRATEGIC INITIATIVES LIVE OAK Core | MOMENTUM BUILDING ACROSS CORE STRATEGIC INITIATIVES Momentum Building Across Strategic Initiatives 22% OF CUSTOMERS HAVE LOAN AND DEPOSIT ACCOUNTS; 57% GROWTH FROM PREVIOUS YEAR 9 22% OF CUSTOMERS HAVE LOAN AND DEPOSIT ACCOUNTS; 57% GROWTH FROM PREVIOUS YEAR Total Assets ($ in billions) Deepening Wallet Share with Deepening Wallet Share with Expanded Banking Products Expanded Banking Products Deepening Wallet Share $377with 78% Expanded Banking Products Expanding Market Share with Expanding Market Share with Small Dollar SBA 7(a) loans Small Dollar SBA 7(a) loans Expanding Market Share with Production Small Dollar SBA 7(a) loans $377 78% Production 94% $377 M $212 $212 78% 94% $212 $212 Production $109 $109 $212 M 94% $212 M 2024 2024 2025 2025 2024 2024 2025 2025 $109 M 2026 Live Oak Bancshares. All rights reserved. | View all disclosures at end of presentation 2026 Live Oak Bancshares. All rights reserved. | View all disclosures at end of presentation 2024 2025 2024 2025
As small business owners navigated the environment, we met them with the capital and banking products they needed to adapt and they held strong. One statistic we track carefully is how Live Oak performs relative to the broader SBA industry. In 2025, our 10-year average annualized SBA net charge-off ratio is shown at 0.3% versus 1.1% for the SBA industry a reminder that verticality and service can win in a credit cycle. Taking The Long View Live Oak credit trends remain better than the SBA industry 1,2 3 1. Source: Lumos Technologies, Inc., SBA 7(a) Program Data for fiscal years ending September 30 2. Default is defined as 60 days past due or indication that the business had been shut down when less than 60 days past due. Denominator is total active loans 3. 10-year average of SBA quarterly net charge-offs as a percentage of the quarterly simple average of SBA loans and leases held for investment, annualized 4. Source: Lumos Technologies, Inc., SBA 7(a) Program by NAICS. 10-year annualized charge-offs by dollar of loans through September 30, 2025 The results are meaningful. Our disciplined execution across the year reinforces confidence in our core strategies. 2025 By The Numbers 4
As I mentioned in last year s letter to you, the bottom line is this: organic growth in the banking business is difficult, and I like the hand we are playing. Our tangible book value grew 13% in 2025, and we ve delivered a 16% CAGR over the last 10 years. That is a clear win for shareholders. Equity Growth Momentum Since Inception ($ in millions) *See Non-GAAP Measures within Part II, Item 7, Management s Discussion and Analysis of Financial Condition and Results of Operations, within the 10-K for calculation Community Bank of the Future But all my life I have been looking around corners thinking about the future. I m going to repeat the point from last year because it s even more true today: the AI wave is not optional. Banks will either learn to surf, or they will drown. In 2025, we continued modernizing our operations so we can deliver two things customers care about: certainty and speed. On our earnings calls, we described continued efforts to improve efficiency and customer experience with the help of evolving AI capabilities. This is a unique moment where a bank can improve the employee experience, customer experience, and profitability at the same time. The goal isn t AI theater. The goal is a bank that processes information faster, serves borrowers better, and scales expertise without sacrificing judgment. At a Town Hall last year, I told our more than 1,000 employees that I wanted every single one of them to understand AI, to use it, and get comfortable with the concept of being an AI-native bank. Why? Because early adopters stay ahead. This is how we are embracing AI to provide better outcomes for our people and our customers. Recently, we held a tutorial on agentic AI for our folks. Within 24 hours of the session, more than 43 agents had been built by Live Oakers to help automate their own tasks. On a more sophisticated level, our teams are co-developing an AI-native loan origination system for Live Oak Express that we plan to deploy across the bank once it is hardened.
Our mantra is to treat every customer like the only customer. Embracing technology to create better experiences is in our DNA. It is how we started Live Oak 17 years ago and remains central to how we think today. What to Watch in 2026 So, what is next? We enter 2026 with clear priorities. We will continue to grow relationships and deepen wallet share with our customers. We will scale what s working in lending while staying disciplined on pricing and structure. We will keep strengthening operating leverage so that PPNR and EPS momentum are sustainable and durable, not episodic. We love organic growth and if the past is a proxy for the future, we believe our model is a win for shareholders. I ve always talked about the three-legged stool if you take care of your employees, they will take care of your customers, and the shareholders will be rewarded. Our driving force is to have the most extraordinary culture, to create raving fans, to lead to uncommon profitability and returns. We like the hand we re playing, and we intend to keep compounding it. Sincerely, James S. Chip Mahan III Chairman and Chief Executive Officer
 • shareholder letter icon 4/2/2026 Letter Continued (Full PDF)
 • stockholder letter icon 3/31/2023 LOB Stockholder Letter
 • stockholder letter icon 4/5/2024 LOB Stockholder Letter
 • stockholder letter icon 4/4/2025 LOB Stockholder Letter
 • stockholder letter icon More "Banking & Savings" Category Stockholder Letters
 • Benford's Law Stocks icon LOB Benford's Law Stock Score = 95


LOB Shareholder/Stockholder Letter Transcript:

Live Oak Bancshares
2025 ANNUAL REPORT

LETTER FROM
THE CHAIRMAN
To Our Shareholders,
If there was a theme to 2025, it was resiliency. Last year was marked by economic uncertainty, rising costs,
regulatory shifts, and competitive pressures.
Our customers dug deep with surprising optimism, determination, and grit   and so did we.
When the world was facing unease, our focus was to Keep the Main Thing the Main Thing.
I am pleased with our performance. Our small business team had a record year of loan growth. Our
commercial banking team continued to expand up-market in deposit rich verticals. Our deposit team
continued to deepen wallet share, and our two strategic initiatives   Live Oak Express and business
checking   continued positive momentum.
Live Oak Express, our small dollar SBA 7(a) loan production, nearly doubled with 94% growth from the
previous year. Business checking had a similar trajectory as 22% of our customers have both loan and
deposit accounts, up 57% from the prior year.
9
LIVE OAK | MOMENTUM
BUILDING
ACROSS CORE
STRATEGIC
INITIATIVES
LIVE
OAK Core
| MOMENTUM
BUILDING
ACROSS CORE
STRATEGIC INITIATIVES
Momentum
Building
Across
Strategic
Initiatives
22% OF CUSTOMERS HAVE LOAN AND DEPOSIT ACCOUNTS; 57% GROWTH FROM PREVIOUS YEAR
9
22% OF CUSTOMERS HAVE LOAN AND DEPOSIT ACCOUNTS; 57% GROWTH FROM PREVIOUS YEAR
Total Assets ($ in billions)
Deepening Wallet Share with Deepening Wallet Share with
Expanded Banking Products Expanded Banking Products
Deepening Wallet Share
$377with
78%
Expanded Banking
Products
Expanding Market Share with
Expanding Market Share with
Small Dollar SBA 7(a) loans
Small Dollar SBA 7(a) loans
Expanding Market Share with
Production
Small Dollar SBA 7(a) loans
$377
78%
Production
94%
$377 M
$212
$212
78%
94%
$212
$212
Production
$109
$109
$212 M
94%
$212 M
2024
2024
2025
2025
2024
2024
2025
2025
$109 M
  2026 Live Oak Bancshares. All rights reserved. | View all disclosures at end of presentation
  2026 Live Oak Bancshares. All rights reserved. | View all disclosures at end of presentation
2024
2025
2024
2025

As small business owners navigated the environment, we met them with the capital and banking products
they needed to adapt   and they held strong.
One statistic we track carefully is how Live Oak performs relative to the broader SBA industry. In 2025, our
10-year average annualized SBA net charge-off ratio is shown at 0.3% versus 1.1% for the SBA industry   a
reminder that verticality and service can win in a credit cycle.
Taking The Long View
Live Oak credit trends remain better than the SBA industry
1,2
3
1. Source: Lumos Technologies, Inc., SBA 7(a) Program Data for fiscal years ending September 30
2. Default is defined as 60 days past due or indication that the business had been shut down when less than 60 days past due. Denominator is total active loans
3. 10-year average of SBA quarterly net charge-offs as a percentage of the quarterly simple average of SBA loans and leases held for investment, annualized
4. Source: Lumos Technologies, Inc., SBA 7(a) Program by NAICS. 10-year annualized charge-offs by dollar of loans through September 30, 2025
The results are meaningful. Our disciplined execution across the year reinforces confidence in our
core strategies.
2025 By The Numbers
4

As I mentioned in last year   s letter to you, the bottom line is this: organic growth in the banking business is
difficult, and I like the hand we are playing. Our tangible book value grew 13% in 2025, and we   ve delivered a
16% CAGR over the last 10 years. That is a clear win for shareholders.
Equity Growth Momentum Since Inception ($ in millions)

*See    Non-GAAP Measures    within Part II, Item 7, Management   s Discussion and Analysis of Financial Condition and Results of Operations, within the 10-K for calculation
Community Bank of the Future
But all my life I have been looking around corners thinking about the future. I   m going to repeat the point
from last year because it   s even more true today: the AI wave is not optional. Banks will either learn to surf,
or they will drown.
In 2025, we continued modernizing our operations so we can deliver two things customers care about:
certainty and speed. On our earnings calls, we described continued efforts to improve efficiency and
customer experience with the help of evolving AI capabilities. This is a unique moment where a bank can
improve the employee experience, customer experience, and profitability at the same time.
The goal isn   t AI theater. The goal is a bank that processes information faster, serves borrowers better, and
scales expertise without sacrificing judgment.
At a Town Hall last year, I told our more than 1,000 employees that I wanted every single one of them to
understand AI, to use it, and get comfortable with the concept of being an AI-native bank. Why? Because
early adopters stay ahead.
This is how we are embracing AI to provide better outcomes for our people and our customers.
Recently, we held a tutorial on agentic AI for our folks. Within 24 hours of the session, more than 43 agents
had been built by Live Oakers to help automate their own tasks.
On a more sophisticated level, our teams are co-developing an AI-native loan origination system for Live
Oak Express that we plan to deploy across the bank once it is hardened.

Our mantra is to treat every customer like the only customer. Embracing technology to create better
experiences is in our DNA.
It is how we started Live Oak 17 years ago and remains central to how we think today.
What to Watch in 2026
So, what is next? We enter 2026 with clear priorities.
We will continue to grow relationships and deepen wallet share with our customers.
We will scale what   s working in lending while staying disciplined on pricing and structure.
We will keep strengthening operating leverage so that PPNR and EPS momentum are sustainable and durable,
not episodic.
We love organic growth and if the past is a proxy for the future, we believe our model is a win for shareholders.
I   ve always talked about the three-legged stool   if you take care of your employees, they will take care of
your customers, and the shareholders will be rewarded. Our driving force is to have the most extraordinary
culture, to create raving fans, to lead to uncommon profitability and returns.
We like the hand we   re playing, and we intend to keep compounding it.
Sincerely,
James S.    Chip    Mahan III
Chairman and Chief Executive Officer


shareholder letter icon 4/2/2026 Letter Continued (Full PDF)
 

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