Newtek Business Services 8K Regulation FD Disclosure | NEWT 3 Aug 15

www.thesba.com

Newtek Business Services Corp.

“The Small Business Authority®”

NASDAQ: NEWT

Hosted by:

Barry Sloane, President & CEO Jennifer Eddelson, EVP & CAO

Investor

Relations

Public

Relations

Newtek

Investor

Relations

Newtek Public

Relations

Jayne

Cavuoto

Director of Investor Relations

jcavuoto@thesba.com

(212)

273-8179

Simrita Singh

Director of Marketing

ssingh@thesba.com

(212)

356-9566

Second Quarter 2015

Financial Results Conference Call

July 30, 2015 8:30 am ET

Exhibit 99.1

www.thesba.com

Note Regarding Forward Looking Statements

This presentation contains certain forward-looking statements. Words such as “believes,”

“expects,” “plans,” “anticipates,” “forecasts” and

“future” or similar expressions are intended to identify forward-looking statements. All forward-looking statements involve a number of

risks and uncertainties that could cause actual results to differ materially from the plans, intentions and expectations reflected in or

suggested by the forward-looking statements. Such risks and uncertainties include, among others, intensified competition, operating

problems and their impact on revenues and profit margins, anticipated future business strategies and financial performance, anticipated

future number of customers, business prospects, legislative developments and similar matters. Risk factors, cautionary statements and

other

conditions,

which

could

cause

Newtek’s

actual

results

differ

from

management’s

current

expectations,

are

contained

Newtek’s

filings with the Securities and Exchange Commission and available through http://www.sec.gov/

www.thesba.com

Second Quarter Financial Highlights

Second full quarter reporting as a BDC

Net asset value (“NAV”) equaled $169.6 million, or $16.62 per share, at June 30, 2015, compared with NAV of

$169.6 million, or $16.61 per share, at March 31, 2015

–

Increase of 1.9% from NAV of $166.4 million, or $16.31 per share, at December 31, 2014

Adjusted net investment income*

was $5.0 million, or $0.49 per share

For the six months ended June 30, 2015 Adjusted net investment income* was $10.3 million, or $1.01 per share

Total investment income was $5.6 million

Newtek Small Business Finance, LLC restructured its $50.0 million revolving line of credit with Capital One, N.A., to

remove the guarantees of the Company’s portfolio companies and extended the term by one year

Newtek Small Business Finance, LLC, signed a lease for approximately 34,000 square feet of office space in Lake

Success, New York (Long Island), which will commence in early 2016

–

Anticipate that moving portfolio companies into one location will facilitate cross selling

Revised loan funding forecast to between $230 million and $270 million of SBA 7(a) loans in 2015, which

represents an approximate 24% increase over 2014

*See Slide 25 for definition of Adjusted net investment income

www.thesba.com

Portfolio and Investment Company Highlights

Goldman Sachs

–

In June 2015, Newtek Merchant Solutions and Newtek Technology Solutions, two of The Company's wholly

owned portfolio companies, closed a $38.0 million four-year multi-draw term loan with Goldman Sachs

Premier Payments LLC

–

In July 2015, Newtek Business Services Corp. acquired Premier Payments LLC, one of the Country’s leading

electronic payment processors with double-digit revenue and EBITDA year-over-year percentage growth, as a

new wholly owned portfolio company, for approximately $16.5 million in cash and restricted newly issued shares

of Newtek Common Stock

Electronic Payment Processing

–

Q2 2015 revenue was $25.5 million; an increase of 10% over $23.2 million in Q2 2014

–

Q2 2015 adjusted EBITDA was $2.5 million; an increase of 10% over $2.2 million in Q2 2014

Newtek Business Credit

–

Anticipate securing $50.0 million warehouse line of credit

*See Slide 25 for definition of Adjusted net investment income

www.thesba.com

Acquisition of Portfolio Company –

Premier Payments LLC

*Includes processing volume from both Newtek Merchant Solutions and Premier Payments LLC

**Year-over-year revenue and EBITDA growth are unaudited pro forma estimations

Acquired Premier Payments LLC on July 23, 2015

Total purchase price was approximately $16.5 million, of which $14.0 million was paid in cash and the remainder

was paid in $2.5 million newly issued restricted shares of Newtek Common Stock

Premier Payments LLC is one of the Country’s leading electronic payment processors, which powers billions of

dollars of credit card and debit card transactions on an annual basis

Anticipate this acquisition will expand The Company’s presence in the merchant processing space, and is expected

to be accretive to earnings beginning in Q3 2015

Anticipate $5.5 billion in electronic payment processing volume* by end of 2015

The following is the estimated** year-over-year Revenue and EBITDA growth of Premier Payments LLC

$ in millions

Q1 2014

Q1 2015

% Increase

Revenue

1.292

1.670

29.3%

EBITDA

0.421

0.670

59.0%

Q2 2014

Q2 2015

% Increase

Revenue

1.493

1.817

21.8%

EBITDA

0.500

0.760

51.9%

www.thesba.com

Dividend Distributions

On July 15, 2015, paid second quarterly dividend of $0.47 per share in cash

Paid a total of $0.86 in cash dividends to date in 2015, which represents approximately 85% of the adjusted

net investment income of $1.01 per share for the six months ended June 30, 2015

Maintain 2015 annual cash dividend forecast of approximately $1.82* per share

Based on final earnings and profits analysis through 2014, management has revised its forecast and

anticipates paying a one-time special dividend of $3.29* per share by the end of 2015

–

It is expected that between 24% and 27% of the special dividend will be paid in cash, with the balance paid in

newly issued shares of Newtek Common Stock

The special dividend will be reported to shareholders as a qualified dividend

* Amount and timing of dividends, if any, remain subject to the discretion of the Company’s board of directors. Amounts based on current share count of approximately 10.3 million.

www.thesba.com

Newtek Small Business Finance

Currently the largest non-bank institution licensed by the U.S. Small Business Administration (SBA) under the

federal Section 7(a) loan program based on annual origination volume (national PLP status)

One of 14 Non-Bank SBA Government-Guaranteed Lender Licenses (these licenses are presently no longer being

issued)

largest SBA 7(a) lender including banks

(1)

ROI in SBA 7(a) lending in excess of 30%

National SBA 7(a) lender to small business since 2003; 12-year history of loan default frequency and severity

statistics

Issued 5 S&P Rated AA & A Securitizations since 2010

Small balance, industry and geographically diversified portfolio of 853 loans

–

Average loan size is $173K of average Newtek uninsured retained loan balance

Floating rate at Prime plus 2.75% with no caps; equivalent to 6% cost to borrower

origination

fees

with

25-year

amortization

schedules

and

are

receiving

high-quality

loan

product

Secondary market established for SBA 7(a) government-guaranteed lending for over 61 years and Newtek

establishes liquidity for uninsured portions through securitizations

After securitization of uninsured portion and sale of government insured portion, principal in the loan is returned

(1)

As of March 31, 2015

www.thesba.com

Comparable Company Statistics

Live Oak Bancshares, Inc. (NASDAQ: LOB)

–

Online platform for small business lending

–

$551 million market capitalization

–

Raised $81.6 million in IPO on 7/23/15

–

Transaction priced at 4.8x tangible book value

On Deck Capital (NYSE: ONDK)

–

Operates an online platform for small business lending

–

Raised $200 million in IPO on 12/17/14

–

$1.3 billion market valuation

Lending Club (NYSE: LC)

–

Operates as an online marketplace that facilitates loans to consumers and businesses in the U.S.

–

Raised over $1.0 billion in IPO 12/11/14

–

$8.9 billion market valuation

BankUnited, Inc. (NYSE: BKU)

–

Acquired Certus’ Small Business Finance Unit in an asset purchase transaction

–

Certus’ loan portfolio totaled approximately $203 million as of January 31, 2015

–

Purchase price for the transaction will be a $20 million premium to the tangible NAV

www.thesba.com

Current SBA 7(a) Loan Pipeline

Loans

pipeline

totaled

approximately

$491.5

million

June

30,

2015

Expect to fund between $230 million and $270 million of SBA 7 (a) loans in 2015, which represents an approximate

24% increase over 2014

SBA 7(a) Loan Pipeline at June

30, 2015

Prequalified Loans

$40,921,692

Loans In Underwriting

$40,599,318

Approved Pending Closing

$29,490,400

Open Referrals

$366,053,580

Total Loan Pipeline

$491,451,916

www.thesba.com

SBA 7(a) Loan Sale Transaction

(1)

Premiums above 10% split 50/50 with SBA. This example assumes guaranteed balance is sold at 15%. The additional 5% (15%-10%) is split with SBA. Newtek nets 12.5%

(2)

Assumes 12.5% of the Guaranteed balance

(3)

Assumes 71% advance rate in securitization on unguaranteed balance

(4)

Assuming the loan is sold in a securitization in 12 months

(5)

Net cash created pre-tax per $1 million of loan originations

Key Variables in Loan Sale Transaction

Loan Amount

$1,000,000

Guaranteed

Balance (75%)

$750,000

Unguaranteed

Balance (25%)

$250,000

Premium

(1)

12.5%

Term

25 years

Net Cash Created Pretax

Guaranteed Balance

$750,000

Realized Gains

on Guaranteed Balance

(2)

$93,750

Cash Received in Securitization

(3)

$177,500

Total

$1,021,250

Net Cash Created Pre-Tax (Post

Securitization)

(4,5)

$21,250

Net Cash Created in SBA 7(a) Loan Sale Transaction – An Example

www.thesba.com

SBA 7(a) Loan Sale Transaction

(1)

Premiums above 10% split 50/50 with SBA. This example assumes guaranteed balance is sold at 15%. The additional 5% (15%-10%) is split with SBA. Newtek nets 12.5%

(2)

Assumes 12.5% of the Guaranteed balance

(3)

Value determined by GAAP servicing value; a present value of future servicing income

(4)

Net risk-adjusted profit recognized per $1 million of loan originations

(5)

Uninsured piece gets immediately written down at origination to reflect cumulative estimate of default frequency and severity

Key Variables in Loan Sale Transaction

Loan Amount

$1,000,000

Guaranteed

Balance (75%)

$750,000

Unguaranteed

Balance (25%)

$250,000

Premium

(1)

12.5%

Term

25 years

Resulting

Revenue (Expense)

Associated Premium

(2)

$93,750

Servicing Asset

(3)

$18,630

Total Realized Gain

$112,380

Packaging

Fee Income

$2,500

FV Non-Cash Discount on Uninsured

Loan

Participations

$(12,500)

Referral Fees Paid to Alliance Partners

$(7,500)

Total Direct

Expenses

$(20,000)

Net Risk-Adjusted Profit Recognized

(4,5)

$94,880

Direct Revenue / Expense of an SBA 7(a) Loan Sale Transaction – An Example

www.thesba.com

Guaranteed Loan Pricing* Comparison

All Loans

10-Year Term Loans

25-Year Term Loans

Qtr

Weighted

Average Sale

Price

Weighted

Average Net

Price to NSBF

Weighted

Average Loan

Term (Yrs)

Weighted

Average Sale

Price

Weighted

Average Net

Price to NSBF

Weighted

Average Sale

Price

Weighted

Average Net

Price to NSBF

Q1 2014

114.49

112.24

15.95

112.19

111.10

118.49

114.25

Q2 2014

115.15

112.57

18.60

112.47

111.23

117.33

113.66

Q3 2014

116.37

113.19

22.32

113.66

111.83

116.89

113.45

Q4 2014

113.62

111.73

17.87

111.40

110.54

115.62

112.81

YTD 2014

115.01

112.49

18.79

112.25

111.09

117.05

113.53

All Loans

10-Year Term Loans

25-Year Term Loans

Qtr

Weighted

Average Sale

Price

Weighted

Average Net

Price to NSBF

Weighted

Average Loan

Term (Yrs)

Weighted

Average Sale

Price

Weighted

Average Net

Price to NSBF

Weighted

Average Sale

Price

Weighted

Average Net

Price to NSBF

Q1 2015

114.87

112.44

18.82

112.73

111.37

116.35

113.18

Q2 2015

114.91

112.46

17.13

113.45

111.73

117.19

113.59

YTD 2015

114.89

112.45

17.98

113.10

111.55

116.71

113.30

*The above prices are solely indicative of where our SBA government-guaranteed participation certificates have historically been bought and sold in the secondary market. Other factors include

loan seasoning, loan size, weighted average maturity and collateral securing the loan.

www.thesba.com

Gain-on-Sale Premium Trend

Loan Sale Premium Income Trend

$ in millions

2010

2011

2012

2013

2014

1 half 2015

$2,428

$12,468

$12,367

$19,456

$19,493

$15,438*

*Net realized gain on non-affiliate investments.

www.thesba.com

Comparative Loan Portfolio Data

12/31/2010 vs. 06/30/2015

Since 2010, the credit quality and diversification of the loan portfolio has steadily improved

Loan Characteristic

As of

12/31/10

As of

06/30/15

Business Type:

Existing

Business

53.9%

77.6%

Business Acquisition

25.9%

16.5%

Start-Ups

20.2%

6.0%

Primary Collateral:

Commercial RE

45.3%

56.9%

Machinery &

Equipment

22.8%

19.1%

Residential RE

22.3%

9.9%

Other

9.6%

7.0%

Percentage First Lien on RE:

Commercial RE

84.8%

95.2%

Residential RE

9.9%

21.1%

Loan Characteristic

As of

12/31/10

Loan Characteristic

As of

06/30/15

Industry:

Restaurant

10.6%

Restaurant

8.9%

Hotels & Motels

7.6%

Amusement

Recreation

6.8%

State Concentration:

Florida

21.6%

Florida

12.3%

New York

12.7%

New

York

11.0%

Georgia

14.1%

Pennsylvania

6.3%

Other:

Total Portfolio at Cost

($mm)

$31

$150

Avg. Balance ($mm)

$0.076

$0.173

Wtd. Avg. Mean FICO

675

703

Wtd. Avg.

Current LTV

78.2%

79.9%

www.thesba.com

SBA 504 Loans: A New Focus for Newtek

Provide financing for major fixed assets such as equipment or real estate

Loans cannot be used for working capital or purchasing inventory (allowed uses under the 7(a) program)

The CDC/504 Loan Program is a long-term financing tool that provides growing businesses with fixed-rate financing

to acquire assets such as land, buildings, and sizeable purchases of equipment

Loan-to-value (“LTV”) ratio for the borrower of 90%; borrowers contribute 10% equity

Newtek has exposure on only 50% of the LTV

U.S. Government has exposure on 40% of the LTV

Newtek will sell the senior loan participation at an anticipated 3-5 point premium

SBA 504 loans give borrowers a fixed-rate alternative

Newtek services the senior loan

www.thesba.com

Sample SBA 504 Loan Structure

An example of a typical SBA 504 loan structure is detailed below

Real Estate Acquisition Loan

$ Amount

Percent

of Total

Purchase Price

$800,000

1st Mortgage Originated by Newtek

$500,000

50%

Renovations

$150,000

Bridge Loan Originally Funded by Newtek*

$400,000

40%

Soft & Closing Costs

$50,000

Borrower Equity Injection

$100,000

10%

Total

$1,000,000

Total

$1,000,000

100%

Up to 50% first mortgage

Up to 40% second mortgage provided by Certified Development Company ($250,000 to $4.0 million)

At least 10% equity contribution

*Taken out by Certified Development Company (“CDC”) funded second mortgage of $400,00 within 60-90 days of Newtek’s funding

www.thesba.com

Loan Sale Transaction-

SBA 504 Loan

Key Variables in Loan Sale Transaction

Total

Projected Financing

$2,000,000

Senior Loan Balance

$1,000,000

Junior Bridge Loan Balance

(1)

$800,000

Borrower Equity

$200,000

Premium

(2)

3.20%

Rate

Fixed

Term

25 Years

Net Cash Created Pretax

Total Senior & Junior Debt

$1,800,000

Funded Under Bank Facility

$1,620,000

Newtek Equity

$180,000

Net Premium Earned

(3)

$32,000

Net Interest Earned Before Sale

(4)

$44,000

Interest Expense

($20,475)

Origination Fees

$14,000

Servicing Fee Income

(5)

$2,500

Total

$1,872,025

Net Cash Created

(6)

$72,025

Return on Investment (Gross Operating

Profit/ Equity)

(7)

40%

(1)

Initially funded by Newtek to be taken out in 90 days by a junior lender through SBA guaranteed debentures

(2)

Assumes 4.00% gross premium with 20% paid to referral source

(3)

Assumes 3.20% net premium paid on Senior Loan Balance

(4)

Assumes Senior and Junior Bridge loans are outstanding for six months and three months, respectively

(5)

Servicing fee generated over six months

(6)

Net cash created per $1.0 million of loan originations. Net cash created equals the addition of Net Premium Earned, Net Interest Earned Before Sale, Origination Fees, Servicing Fee Income less Interest Expense

(7)

The first year return on investment is based on net cash created of $72,025 divided by Newtek equity of $180,000. The holding period for the loan is actually 6 months but the return is based on the full year

Net Cash Created in SBA 504 Loan Sale Transaction – An Example

www.thesba.com

Portfolio Company –

Newtek Merchant Solutions

(1)

Estimates via Bloomberg

*See page 25 for definition of Adjusted EBITDA.

Publicly Traded Comparable Companies

Name (Symbol)

Enterprise Value /

2015E EBITDA

(1)

Heartland Payment Systems (HPY)

9.10x

Vantiv, Inc. (VNTV)

10.24x

Enterprise Valuation & Financial Performance

Valued at 5.3x EBITDA

Valued at $50 million

Electronic payment processing business, which we have wholly owned and managed for 10+ years

Over 13,000 business accounts; realized over $4.6 billion in electronic payment processing volume in

2014

Q2 2015 Revenue

of $25.5 million; an increase of 10% over $23.2 million in Q2 2014

Q2 2015 Adjusted EBITDA of $2.5 million; an increase of 10% over $2.3 million in Q2 2014

2015 Forecast

Revenue: $99.9 million

Adjusted EBITDA:

$9.5 million

www.thesba.com

Portfolio Company -

Newtek Technology Solutions

(1)

Estimates via Bloomberg.

*See page 25 for definition of Adjusted EBITDA.

Managed technology & cloud computing business, which we have wholly owned and managed for 10+ years

Host and manage SMBs computer hardware, software and their technology solutions in our Level-4, 5,000

square foot data center in Phoenix, Arizona

Over 106,000 business accounts and over 77,000 domain names

This segment is being transformed to take advantage of shift to cloud-based business trends including

eCommerce, Payroll and Insurance; additional cloud offerings in the pipeline

Restructured

data

center

lease,

which

anticipate

will

allow

save

between

$200K

$250K

per

year

–

Acquired additional space in the U.K., New Jersey and Phoenix, Arizona

Q2 2015 Revenue of $3.6 million; a decrease of 14.3% over $4.2 million in Q2 2014

Q2 2015 Adjusted EBITDA of $0.8 million; a decrease of 38.5% over $1.3 million in Q2 2014

Publicly Traded Comparable Companies

Name (Symbol)

Enterprise Value /

2015E EBITDA

(1)

Endurance (EIGI)

12.07x

Rackspace Holdings, Inc. (RAX)

7.12x

Enterprise Valuation & Financial Performance

Valued at 1.4x revenue

Valued at $21 million

2015 Forecast

Revenue: $14.8 million

Adjusted EBITDA:

$3.3 million

www.thesba.com

Internally Managed vs. Externally Managed BDCs

Newtek is an internally managed BDC, and is currently trading at 1.15x* NAV

The following Internally managed BDC public comparables currently trade at a median price to NAV of

approximately 1.20x**

–

Hercules Technology Growth Capital (NASDAQ: HTGC)

–

KCAP Financial (NASDAQ: KCAP)

–

Main Street Capital (NASDAQ: MAIN)

–

Triangle Capital (NASDAQ: TCAP)

* As of July 27, closing price of $19.17

**As of July 27, 2015.

Internally Managed BDCs

Externally Managed BDCs

No base or incentive fees paid to an external manager

Pay expense fees and incentive to a management company

Generally a greater percent of revenue becomes dividend

income for the shareholder

Not required to provide shareholders with compensation

information

Lower operating expense ratios than externally managed

Higher operating expense ratios than internally managed BDCs

Typically trade at a premium to NAV/share

Typically trade at a discount to NAV/share

www.thesba.com

Investment Summary

NAV of $16.62 per share at June 30, 2015; a 1.9% increase over NAV per share at December 31, 2014

Company

better

suited

for

investors

BDC

vs.

operating

company

Forecasted dividends

–

Expect to pay an annual cash dividend of approximately $1.82* in 2015

–

Anticipate paying special dividend of $3.29* per share by the end of 2015, of which between 24% and 27% is presently

expected to be paid in cash, with the balance paid in newly issued shares of Newtek Common Stock

Investing in an business without excessive leverage offers attractive returns without excessive risk

Portfolio companies wholly owned and managed, most for over 10 years, by Newtek Business Services Corp.

Newtek Business Services Corp. is an internally managed BDC

Proven Track Record; Established in 1998; publically traded since September 2000

Management’s interests aligned with Shareholders

CEO is a major shareholder; Founders, Management and Board combined own approximately 20% of outstanding

(1)

No derivative securities in BDC

No 2

lien or mezzanine financing as a business line

No direct lending exposure to oil and gas industry

(1)

As of July 29, 2015

*Amounts based on the Company’s current outstanding shares of approximately 10.3 million

www.thesba.com

Financial Review –

Jennifer C. Eddelson, Chief Accounting Officer

www.thesba.com

Consolidated Statement of Operations

Newtek Business Services Corp. and Subsidiaries

Three Months

Ended June 30, 2015

Investment income:

From non-controlled/non-affiliate investments

Interest income

2,231

Servicing income

1,068

Other income

464

Total investment income from non-controlled/non-affiliate investments

3,763

From controlled/affiliate investments

Interest income

Dividend income

1,787

Other income

—

Total investment income from controlled/affiliate investments

1,843

Total investment income

5,606

Expenses:

Salaries and benefits

3,133

Interest

1,728

Depreciation and amortization

Other general and administrative costs

2,955

Total expenses

7,901

Net investment loss

(2,295)

Net realized and unrealized gains (losses):

Net realized gain on non-affiliate investments

7,340

Net unrealized depreciation on SBA guaranteed non-affiliate investments

(1,464)

Net unrealized depreciation on SBA unguaranteed non-affiliate

investments

(470)

Net unrealized appreciation on affiliate investments

2,019

Net unrealized loss on servicing assets

(256)

Net unrealized appreciation on credits in lieu of cash and notes payable

in credits in lieu of cash

Net realized and unrealized gains

7,171

Net increase in net assets resulting from operations

4,876

Net investment loss per share

(0.22)

Net increase in net assets per share

0.48

Weighted average shares outstanding

10,206

(n thousands)

www.thesba.com

Change in Net Asset Value

(1) Adjusted Net investment income is defined as Net investment income plus Net realized gains.

(in thousands, except per share data)

NAV

NAV/Share

NAV % Change

NAV at December 31, 2014

166,418

16.31

Net investment income (loss)

(4,771)

(0.47)

-2.9%

15,039

1.47

9.0%

(4,298)

(0.42)

-2.6%

9,519

0.93

5.7%

(612)

(0.06)

-0.4%

Net unrealized appreciation on credits in lieu of cash and

notes payable in credits in lieu of cash

0.00

0.0%

Net increase in net assets from operations

14,879

1.46

8.9%

Dividends declared

(8,787)

(0.86)

-5.3%

Net increase in net assets after dividend

6,092

0.60

3.7%

NAV after dividend

172,510

16.90

Opening balance adjustment to Deferred tax asset

(2,870)

(0.28)

-1.7%

Adjustment to 2014 offering costs

0.00

-0.4%

Consolidation of Texas Whitestone Group and CCC Real Estate

(33)

(0.00)

-0.2%

NAV at June 30, 2015

169,624

16.62

1.9%

Total common shares outstanding:

10,206

Adjusted Net investment income

10,268

Adjusted Net investment income

per share

1.01

NAV per share

16.62

As of June 30, 2015

Newtek Business Services Corp. and Subsidiaries

Net realized gains - non-affiliate investments

Net unrealized losses - non-affiliate investments

Net unrealized loss - Servicing asset

Net unrealized gain/loss - Controlled portfolio companies

www.thesba.com

Adjusted Net Investment Income Reconciliation

For the three months

ended March 31, 2015

Per share

For the three

months ended June

Per share

For the six months

ended June 30,

Per share

Net investment loss

(2,476)

(0.24)

(2,295)

(0.22)

(4,771)

(0.47)

Net realized gain on non-affiliate investments

7,699

0.75

7,340

0.72

15,039

1.47

Adjusted net investment income

5,223

0.51

5,045

0.49

10,268

1.01

Adjusted Net Investment Income (ANII)

In thousands, except per share data

www.thesba.com

Non-GAAP Financial Measures

In evaluating its business, Newtek considers and uses adjusted net investment income as a measure of its operating

performance. Adjusted net investment income includes short-term capital gains from the sale of the guaranteed

portions of SBA 7(a) loans, which is a reoccurring event. The Company defines Adjusted net investment income (loss)

as Net investment income (loss) plus Net realized gains.

The Company defines Adjusted EBITDA as earnings before, interest expense, taxes, depreciation and amortization,

corporate

overhead

allocation

and

stock

compensation

expense.

Newtek

uses

Adjusted

EBITDA

supplemental

measure

review

and

assess

the

operating

performance

its

portfolio

companies.

The

Company

also

presents

the

Adjusted EBITDA of its portfolio companies because it believes it is frequently used by securities analysts, investors

and other interested parties as a measure of financial performance.

The terms Adjusted net investment income and Adjusted EBITDA, are not defined under U.S. generally accepted

accounting principles, or U.S. GAAP, and are not a measure of operating income, operating performance or liquidity

presented

accordance

with

U.S.

GAAP.

Adjusted

net

investment

income

and

Adjusted

EBITDA,

have

limitations as

analytical tools and, when assessing the Company’s operating performance, and that of its portfolio companies,

investors should not consider Adjusted net investment income and Adjusted EBITDA in isolation, or as a substitute for

net investment income (loss), or other consolidated income statement data prepared in accordance with U.S.

GAAP.

Among other things, Adjusted net investment income and Adjusted EBITDA do not reflect the Company’s, or

its

portfolio

companies,

actual

cash

expenditures.

Other

companies

may

calculate

similar

measures

differently

than

Newtek,

limiting

their

usefulness

comparative

tools.

The

Company

compensates

for

these

limitations

relying

primarily on its GAAP results supplemented by Adjusted net investment income and Adjusted EBITDA.

www.thesba.com

Adjusted EBITDA Reconciliation

For the three

months ended

June 30, 2015

For the three

months ended

June 30, 2014

(in millions)

Pretax income

0.35

0.92

Interest expense

0.01

Depreciation and amortization

0.32

0.33

Stock compensation expense

(0.00)

Corporate overhead allocation

0.13

Adjusted EBITDA

0.81

1.26

Managed Technology Solutions

For the three

months ended

June 30, 2015

For the three

months ended

June 30, 2014

(in millions)

Pretax income

2.17

2.16

Interest expense

0.02

Depreciation and amortization

0.07

0.06

Stock compensation expense

0.07

Corporate overhead allocation

0.20

Adjusted EBITDA

2.46

2.29

Electronic Payment Processing

Newtek Business Services (NEWT) 8-KRegulation FD Disclosure