Live Oak Bancshares: 3 Key Takeaways for Long-Term Investors
Key PointsPreprovision net revenue rose 33% year over year to $88 million.
Live Oak Bancshares (LOB) reported solid third-quarter 2026 results on Oct. 22, 2026, with $0.52 earnings per share. The bank's loan loss provisions for its exited distillery portfolio were $17 million, resulting in a $0.27 per share earnings reduction. However, strong preprovision net revenue of $88 million enabled the company to manage the charge without disrupting operations.
Originations in Live Oak Express, the bank's SBA small-dollar loan division, saw a remarkable 173% year-over-year increase to $107 million. Selling guaranteed loan portions contributed $7 million in fee income, with a $7 million gain from the sale being up 250% year-over-year. Over the last five quarters, this has amounted to $18 million, roughly $0.30 of earnings accretion and growing.
Business checking balances at Live Oak exceeded $500 million, a 39% year-over-year growth, providing funding at a lower cost than retail certificates of deposit. Customer relationships are deepening, with 25% of customers now holding both a loan and deposit account, up from 20% a year ago. Four years ago, that figure was only 3%.
Loan and deposit account co-ownership among customers is now at 25%, up from 20% a year ago. Additionally, four years ago, the number was only 3%. Business checking balances grew by 39% year-over-year, providing funding at a lower cost than retail certificates of deposit.
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