NewtekOne, Inc. (NEWT) as of March 31, 2026 presents a classic bank-holding-company liquidation profile: thin positive book equity against a heavily liability-weighted balance sheet, with the majority of asset value residing in loan portfolios that carry material haircut exposure under a forced-sale scenario. Total reported assets are $2.89B against total liabilities of $2.48B, yielding book equity of $404.7M. MFFAIS CLV/LLV/OLV are all reported at -$122.8M, reflecting the standard liquidation asymmetry for a bank: assets get haircut, liabilities settle at face. The primary driver of negative recovery is the $1.76B deposit base ($1.86B total deposits at face) and $550.5M long-term borrowings stack, both of which stand at face in liquidation regardless of how the loan portfolio actually clears. On the asset side, the two largest asset categories are loans held for investment net ($941.5M after $46.7M ACL) and loans held for sale ($769.2M at fair value). SBA 7(a) unguaranteed and ALP/C&I LA loans are Level 3 fair value instruments; forced liquidation discounts to these would be material. The ACL increased from $33.1M (Q1 2025 average) to $46.7M at March 31, 2026, a 41% increase year-over-year, signaling rising credit stress in the held-for-investment book. Nonaccrual loans totaled $35.6M with an additional $51.8M nonaccrual with no allowance. The NSBF segment is in active wind-down, generating recurring losses ($7.5M in Q1 2026 vs. $5.0M Q1 2025) and driving increased servicing asset impairment losses. The servicing asset portfolio totals $55.3M ($41.7M amortized cost basis plus $13.6M FV), which receives 0% recovery under liquidation lens. Goodwill ($14.1M) and intangibles ($0.5M) likewise recover $0. Structural subordination of the parent's unsecured notes to all subsidiary liabilities is an explicit risk: the 2026 Notes ($87.1M) were repaid at maturity on February 1, 2026, replaced partly by $7.9M of 2031 Notes and $15.0M of new 2033 Notes (private placement at 8.375%). Post-payoff, the remaining senior note stack is 2028 Notes ($40M, 8.00%), 2029 8.50% Notes ($71.9M), 2029 8.625% Notes ($75M), 2030 Notes (~$52M), 2031 Notes ($7.9M), 2033 Notes ($15M), and the Goldman Facility (~$89.8M at subsidiary). Deposit growth was substantial: average interest-bearing deposits rose from $968M (Q1 2025) to $1.68B (Q1 2026), driven primarily by savings/NOW accounts (+$517M average). This deposit-funded balance sheet expansion raises the liability floor in liquidation even as asset base grew. The 2026-1 securitization trust (January 21, 2026; $341.8M ALP collateral) resulted in deconsolidation of those loans from HFS and recognition of $56.1M gain on residual interests; the residuals ($55.3M servicing asset aggregate) carry 0% liquidation recovery. Filing discusses the D2 Facility ($20.9M term loan, closed April 28, 2026) in the subsequent events section; this post-period liability is not yet reflected in the March 31 balance sheet. Newtek Bank Tier 1 leverage ratio is 9.1%, CET1 11.1%, Total Capital 12.4%—well-capitalized but the parent company's consolidated capital ratios (Tier 1/avg assets 13.1%, Total Capital/RWA 19.3%) reflect significant non-bank subsidiary capital sitting above Newtek Bank, which is structurally subordinated to bank depositors in liquidation.
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