Newtek Business Services received conditional approval from Office of the Comptroller of the Currency (OCC) to complete its acquisition of the National Bank of New York City (NBNYC). Newtek received approval from the Federal Reserve to become a bank holding company and a financial holding company by acquiring NBNYC. Newtek expects the acquisition to close in January 2023, subject to completion or waiver of the remaining closing conditions. Upon the close of the acquisition, NBNYC will be renamed Newtek BankTM, National Association and Newtek’s current portfolio companies Newtek Business Lending and Small Business Lending will be contributed to Newtek Bank. The OCC approval is subject to the condition that Newtek Bank enter into an operating agreement with the OCC upon the close of the acquisition, which operating agreement contains customary provisions concerning capital, liquidity and concentration limits and memorializes the business plan submitted to the OCC.

“We could not be more elated to receive the OCC’s approval to move forward and close the acquisition and become a bank holding company and financial holding company,” Barry Sloane, chairman, president and CEO, said. “With a national bank charter, we believe Newtek will be able to enhance the business and financial solutions offered to our customers to include personalized digital commercial banking and the Newtek Advantage dashboard and truly become NewtekOne – the One Solution for All Your Business Needs.

“Given these approvals, Newtek can proceed with its bank holding company strategy, and intends to publicly issue financial guidance for Newtek as a bank holding company owning Newtek Bank. The regulatory approvals also will allow Newtek to execute on its plan and strategy to acquire and rebrand NBNYC as Newtek Bank, and to change the name of the holding company to NewtekOne. We intend to keep our current stock symbol ‘NEWT’.”

”We look forward to paying our recently declared distribution of $0.70 per share for the fourth quarter 2022 on December 30, 2022, to shareholders of record as of December 20, 2022. This distribution will likely be Newtek’s final distribution as a BDC. Upon the closing of the Acquisition, Newtek will discontinue its election to be regulated under the Investment Company Act of 1940, will no longer qualify as a regulated investment company (“RIC”) for federal income tax purposes and will no longer qualify for accounting treatment as an investment company. Newtek has previously stated that subject to Newtek board approval, compliance with regulatory requirements and Newtek achieving its operational and financial goals, it anticipates that Newtek will continue to pay dividends as a bank holding company. We would like to note that if dividends are paid from the Newtek bank holding company, we expect they will be treated as qualified dividends versus the pass-through status of dividend treatment in the BDC/RIC structure.”