NewtekOne, Inc. closed a $295 million securitization backed by $342 million of Alternative Loan Program (ALP) loans, creating the NALP Business Loan Trust 2026‑1. The deal is the company’s 17th rated securitization and its largest to date, underscoring a track record of successful, investment‑grade asset‑backed financing.
The trust sold $251.88 million of Class A Notes, $35.88 million of Class B Notes and $6.84 million of a Class C Note to 32 institutional investors. The notes are secured by $284.38 million of company‑originated ALP loans and a $57.4 million prefunding account that will be used to add additional ALP loans to the pool. The transaction was roughly ten‑times oversubscribed, a sign of strong demand for NewtekOne’s loan portfolio.
The weighted‑average spread on the notes is 243 basis points over Treasuries, an improvement from the 271 basis‑point spread on the 2025 ALP securitization. ALP loans carry a gross weighted‑average coupon of 12.74%, which translates to a net yield of 11.74% after a 1% servicing fee. The resulting excess spread of 5.7% over the notes’ weighted‑average yield of 6.08% is being used to retire debt faster, build over‑collateralization and grow the company’s book value.
Strategically, the securitization expands NewtekOne’s funding base and reduces reliance on traditional capital markets, supporting the company’s goal of growing its ALP loan book at a low cost of funds. ALP loans offer longer amortization schedules (10‑25 years) and higher borrowing limits (up to $15 million) than typical SBA or fintech products, and the company’s underwriting has produced only six defaults and one charge‑off since 2019 out of roughly $850 million in originations. The transition to a nationally chartered bank holding company has further diversified funding sources and lowered financing costs, while deposit growth is projected to exceed 17,000 depositors in 2025 and loan origination is expected to reach 2,700 loans, up from 2,400 in 2024.
CEO Barry Sloane said the deal demonstrates NewtekOne’s “premier originator” status and its patient, value‑creating approach to lending, contrasting with competitors’ short‑term, high‑interest programs. He highlighted the company’s consistent track record of investment‑grade securitizations that have never been placed on credit watch, reinforcing investor confidence in the quality of the ALP loan portfolio.
The ten‑fold oversubscription and participation of 32 institutional investors signal strong market confidence in NewtekOne’s underwriting and risk management. The successful completion of this largest securitization to date positions the company to continue accessing capital markets at attractive terms, supporting its broader strategy of expanding the ALP loan book and maintaining a low cost of funds.
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