Happen, Inc. Reports Third Quarter 2026 Results

EmitenTrust.com - Record $76.8 Million Pre-Tax Income, 15.0% ROE, and 15.8% ROTCE

Grew Originations 26% Year-over-Year, Increased Diluted EPS 35% Year-over-Year to $0.50

Raising Diluted EPS and Narrowing Originations Annual Guidance Ranges

SAN FRANCISCO, Oct. 28, 2026 /PRNewswire/ -- Happen, Inc. (Nasdaq: HAPN), parent company of Happen Bank, a digital bank built for the Motivated Middle, today announced financial results for the third quarter ended September 30, 2026.

"We had another great quarter, effectively navigating the dynamic rate environment to deliver record pre-tax income of $76.8 million and a return on tangible common equity of 15.8%, while growing originations 26% year-over-year to $3.3 billion," said Scott Sanborn, CEO, Happen, Inc. "Our new brand is taking root, our core business is performing well, we continue to outperform on credit, marketplace demand remains strong. We're also effectively delivering against each of our growth initiatives, including starting to scale into the $500 billion home improvement market."

Third Quarter 2026 Results

Highlights:

• Delivered growth across lending businesses, resulting in a 26% increase in quarterly originations.
• Added distribution partners in the home improvement business, with a strong pipeline of interest.
• Continued multi-year credit outperformance versus competitor set, with ~40% lower delinquencies.
• Crossed $10 billion in loans sold through proprietary structured certificates programs, reflecting robust marketplace demand.
• AI-powered agent support tools led to >90% automation rate on originations and record originations efficiency.
• Ongoing execution of the Stock Repurchase and Acquisition Program, with cumulative utilization of $59 million through September.
• Won numerous prestigious awards, including Money.com's Best Bank, Finovate's Best Customer Experience Award, and Business Insider's America's Most Innovative Businesses.

Balance Sheet:

• Total assets of $13.3 billion, up 20% year-over-year, primarily due to growth in loans and securities.
• Deposits of $11.5 billion, up 22% year-over-year, with 89% of deposits FDIC-insured.
• Robust available liquidity of $4.2 billion.
• Increased hedging program notional balances to $2.5 billion from $1.5 billion in the prior year.
• Strong capital position with a consolidated Tier 1 leverage ratio of 12.0% and a CET1 capital ratio of 15.7%.
• Book value per common share was $13.81, compared to $12.68 in the prior year.
• Tangible book value per common share was $13.11, compared to $11.95 in the prior year.

Financial Performance:

• Achieved $3.3 billion in origination volume, up 26% compared to the prior year, driven by the successful execution of product and marketing initiatives.
• Total net revenue of $263.2 million, compared to $266.2 million in the prior year, driven by the 2026 election of fair value option (FVO) accounting for all new originations.
• Risk-adjusted revenue of $279.1 million, up 27% compared to the prior year.
• Provision benefit of $15.9 million, compared to an expense of $46.3 million in the prior year, due to strong credit performance and the 2026 election of FVO accounting for all new originations.
• Net charge-off ratio on total loans and leases held for investment improved to 3.1%, compared to 3.4% in the prior year.
• Profit margin (pre-tax) of 29.2%, compared to 21.5% in the prior year.
• Diluted EPS increased 35% to $0.50, compared to $0.37 in the prior year.
• Return on Equity (ROE) of 15.0% with a Return on Tangible Common Equity (ROTCE) of 15.8%.

Summary Financial Highlights:

For a calculation of Tangible Book Value Per Common Share, Return on Tangible Common Equity and Risk-Adjusted Revenue, refer to the "Reconciliation of GAAP to Non-GAAP Financial Measures" tables at the end of this release.

2026 Strategic Priorities & Investments

Happen has made important progress on several strategic initiatives:

Corporate Rebrand: Rebranded to Happen, Inc. and Happen Bank^TM, a bank that clears the way for people going places, providing fast and easy access to award-winning products that help them save more of what they earn and earn more on what they save. The new brand reflects the company's transition from a pioneering online lender to a diversified digital-first bank that combines deposits, lending, and a capital-light marketplace bank model. The company completed the transition and began trading on Nasdaq under HAPN in June 2026.

Home Improvement Financing: Having previously acquired foundational technology and key talent, Happen Bank is now underwriting and originating home improvement loans and the pipeline of additional new partners is significant. Home improvement is a $500 billion market where Happen Bank has distinct advantages over incumbents and a meaningful opportunity for growth.

AI and Operating Efficiency: The company has multiple AI initiatives underway across marketing, product, engineering, operations, customer experience, and compliance, with the goal of improving member experience, driving efficiency, facilitating new customer acquisition, and supporting margin expansion over time. AI-powered automation and agent support tools have already led to record personal loans originations production efficiency and an ongoing >90% automation rate for issued loans.

New Marketing Channel Investment: The company increased investments in new acquisition channels, including paid social and display, in order to build attribution models and data capabilities for the full-year 2026 growth plan. Successful execution of marketing and product initiatives contributed to a 26% year-over-year increase in originations in the third quarter.

Transition to Fair Value Option Accounting: Starting January 1, 2026, Happen Bank adopted FVO accounting for all new originations of loans held for investment. This change aligns the accounting treatment for loans held for investment and held for sale, creating a consistent framework across the business and better aligns the timing of revenue recognition with the timing of credit and operational expenses. The company expects this transition will, over time, result in higher return on invested capital.

For financial reporting, under FVO, new loans are marked to fair value at origination, with subsequent changes in fair value, reflecting both credit performance and market conditions, flowing through non-interest income each quarter rather than through a separate provision for credit losses. The company will no longer record a CECL provision on new loan originations.

Financial Outlook

• Narrowing full year 2026 originations guidance, prioritizing unit margins in the elevated rate environment while driving 26%-27% annual growth.
• Raising full year 2026 diluted EPS guidance to $1.87-$1.92 from $1.80-$1.90, reflecting 61%-66% annual growth.
• Guidance assumes a stable consumer and interest rate environment, with a 25 basis point increase in the Fed funds rate in December.

About Happen Bank

Happen Bank™ – formerly LendingClub Bank – is a digital bank built for the Motivated Middle: high-FICO, high-income, digitally savvy consumers actively managing their financial lives. Our difference? We make it easy for them to access award-winning products that help them keep more of what they earn and earn more on what they save. Our products are aligned by design to reward our five million plus members when they take positive financial steps, like saving regularly or making loan payments on time.

The Company's success is fueled by our advanced credit underwriting, a proprietary technology platform engineered for innovation, and a marketplace bank model that drives value for members, loan investors, and shareholders alike. The result is affordable credit, meaningful value, and a trusted banking relationship – delivered consistently and profitably at scale.

Happen Bank exists to clear the way for our members to make it happen.

Happen, Inc. (Nasdaq: HAPN) – formerly LendingClub Corporation – is the parent company and operator of Happen Bank, National Association, Member FDIC. For more information about Happen Bank, visit https://www.happen.com.

Conference Call and Webcast Information

Happen, Inc.'s third quarter 2026 webcast and teleconference is scheduled to begin at 2:00 p.m. Pacific Time (or 5:00 p.m. Eastern Time) on Wednesday, October 28, 2026. A live webcast of the call will be available at https://ir.happen.com under News & Events menu. To listen to the call, register using this link: https://events.q4inc.com/attendee/495409717 ten minutes prior to 2:00 p.m. Pacific Time (or 5:00 p.m. Eastern Time). An audio archive of the call will be available at https://ir.happen.com. Happen, Inc. communicates with its investors and the public, including by disclosing material information pursuant to Regulation FD, through various channels, including its website (including the investor relations page at https://ir.happen.com), social media (including X, LinkedIn and Facebook), filings with the Securities and Exchange Commission, press releases, conference calls and webcasts. Accordingly, we encourage investors and the public to review our communications across all channels.

Contacts

For Investors:

IR@happen.com

Media Contact:

Press@happen.com

Non-GAAP Financial Measures

To supplement our financial statements, which are prepared and presented in accordance with GAAP, we use the following non-GAAP financial measures: Tangible Book Value (TBV) Per Common Share, Return on Tangible Common Equity (ROTCE), and Risk-Adjusted Revenue. Our non-GAAP financial measures do have limitations as analytical tools and you should not consider them in isolation or as a substitute for an analysis of our results under GAAP.

We believe these non-GAAP financial measures provide management and investors with useful supplemental information about the financial performance of our business, enable comparison of financial results between periods where certain items may vary independent of business performance, and enable comparison of our financial results with other public companies.

We believe TBV Per Common Share is an important measure used to evaluate the company's use of equity. TBV Per Common Share is a non-GAAP financial measure representing tangible common equity for the period (common equity reduced by goodwill and customer relationship intangible assets), divided by the ending number of common shares issued and outstanding.

We believe ROTCE is an important measure because it reflects the company's ability to generate income from its core assets. ROTCE is a non-GAAP financial measure calculated by dividing annualized net income by the average tangible common equity for the applicable period.

We believe Risk-Adjusted Revenue is an important measure reflecting the credit risk-adjusted financial performance of our business operations. Risk-Adjusted Revenue is equal to Total Net Revenue less Provision for Credit Losses.

For a reconciliation of such measures to the nearest GAAP measures, please refer to the tables on page 12 of this release.

Safe Harbor Statement

Some of the statements above, including statements regarding our entry into home improvement financing, our AI initiatives, the impact of the transition to fair value option accounting and anticipated future performance and financial results, are "forward-looking statements." The words "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "outlook," "plan," "predict," "project," "should," "will," "would" and similar expressions may identify forward-looking statements, although not all forward-looking statements contain these identifying words. Factors that could cause actual results to differ materially from those contemplated by these forward-looking statements include: our loan performance, our ability to continue to attract and retain new and existing borrowers and marketplace investors (including retaining long-term investors through the duration of their expected partnership and achieving the anticipated level of purchases); competition; overall economic conditions; our ability to integrate acquired technology; the interest rate and/or regulatory environment; default rates and those factors set forth in the section titled "Risk Factors" in our most recent Annual Report on Form 10-K, as filed with the Securities and Exchange Commission, as well as in our subsequent filings with the Securities and Exchange Commission. Actual results or events could differ materially from the plans, intentions and expectations disclosed in forward-looking statements, and you should not place undue reliance on forward-looking statements. We do not assume any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

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SOURCE Happen, Inc.