Qubix Drives Deposit Surge, But Digital Assets Aren’t the Engine

Date of Call: Jan 23, 2026

Financials Results

• EPS: Core EPS of $7.61 per share in 2025, up 36% from last year, and $2.06 per share in Q4.
• Operating Margin: Core ROE of 13.8% in Q4; ROA of about 1.2% in Q4.

Guidance:

• Loan growth targeting 8%-12% for 2026.
• Deposit growth net of remixing targeting 8%-12% for 2026.
• Net interest income expected to be $800M-$830M for the year, representing 7%-11% growth.
• Non-interest expenses projected at $440M-$460M for the year, growth of 2%-6%.
• Common Equity Tier 1 ratio targeted at 11.5%-12.5%.
• Effective tax rate expected between 23% and 25%.

Business Commentary:

Strong Financial Performance:

• Customers Bancorp reported a core EPS of $7.61 for the full year 2025, up from $5.60 in 2024, reflecting a 36% increase.
• The growth was driven by exceptional deposit-led growth, low-cost core deposits increasing at a 16% compounded annual rate over six years, and significant improvements in profitability.

Deposit and Loan Growth:

• Total deposits grew by about $2 billion, or 10%, in 2025, led by new commercial banking teams adding $1.6 billion.
• Loans grew by 15%, with broad-based growth across commercial real estate, healthcare, and mortgage finance.
• The growth in deposits and loans was supported by strong recruitment of top-performing teams and the expansion of payments offerings.

Payments Platform Expansion:

• The Qubix platform processed over $2 trillion in payments volume in 2025, a 30% increase from the previous year, establishing Customers Bank as the number one commercial payments network in the U.S.
• This growth was driven by the in-house development of Qubix, which allows seamless interaction across various payment rails, and the expansion of digital asset and traditional verticals.

AI and Operational Excellence:

• AI initiatives resulted in nearly 20% productivity gain across the organization, with over half of the firm utilizing enterprise-level AI operating platforms.
• Operational excellence initiatives targeted $20 million in run rate proceeds, to be reinvested in strategic growth areas, focusing on enhancing revenue and reducing costs.

Capital and Credit Quality:

• Customers Bancorp strengthened its capital position with a sub-debt issuance providing $100 million of additional tier two capital, increasing the tangible common equity ratio to 8.5%.
• Credit performance remained stable, with non-performing assets at 29 basis points of total assets and net charge-offs declining by 10% in the quarter.

Sentiment Analysis:

Overall Tone: Positive

• Management highlighted 'very strong financial performance across the board,' 'incredible results,' and 'exceptional year.' The tone was optimistic about 2026, citing 'strong pipelines,' 'incredible momentum,' and confidence in continued growth, with statements like 'we’re incredibly excited about the prospects for this company in 2026 and beyond.'

Q&A:

• Question from Janet Lee (TD Cowen): Concerns about expectations for fee income growth in 2026 and where optimism is highest.
  Response: CFO Mark McCollum indicated that while specific businesses may lead in different quarters, the average non-interest income has been around $30 million per quarter, and they are now focused on better monetizing mature businesses.

• Question from Janet Lee (TD Cowen): Deposit growth expectations for 2026 and the role of Qubix/digital assets.
  Response: CEO Sam Sidhu clarified that deposit growth guidance is driven by core commercial banking teams, not digital asset balances, which are stable and not a material contributor, though there is potential upside from expanding payments networks.

• Question from Steve Moss: Details on new team hiring for 2026 and how to translate $50B in projected transaction volume to deposits.
  Response: CEO Sam Sidhu noted discussions with multiple teams are ongoing, focusing on low-cost deposit gathering. The $50B volume target is from existing customers, with payments deposits typically being low to no cost; 2026 aims to build on the $500M of non-digital asset Qubix-related deposit growth in 2025.

• Question from Steve Moss: Puts and takes for loan growth expectations and upside potential.
  Response: CFO Mark McCollum stated that different loan segments will lead in different quarters, with commercial real estate and healthcare being strong in recent periods; the pipeline is strong and they feel good about the full-year guide.

• Question from Kelly Motta (KBW): Whether expense guidance factors in additional team hiring and trends in professional fees.
  Response: CFO Mark McCollum confirmed the expense guide assumes continued investment in teams, supported by operational excellence initiatives, and expects professional services fees to decline from prior elevated levels.

• Question from Kelly Motta (KBW): Examples of Qubix use cases beyond digital assets.
  Response: CEO Sam Sidhu highlighted mortgage finance and retail/escrow industries as areas where Qubix can deepen existing customer relationships and onboard new verticals, driving payments volume and deposit growth.

• Question from Brian Wilczynski (Morgan Stanley): Resiliency of Qubix platform amid crypto volatility and stability in deposits.
  Response: CEO Sam Sidhu explained that price volatility drives higher trading activity and network usage, with balances fluctuating within a ±10% range; the platform's strength is in strengthening product offerings and expanding payment rails.

• Question from Brian Wilczynski (Morgan Stanley): Focus areas for deepening client relationships and adding products with Qubix.
  Response: CEO Sam Sidhu emphasized adding new payment rails and enabling bespoke, market-specific functionality to help customers run their business more effectively, particularly in regulatory and product-focused areas.

• Question from Peter Winter (D.A. Davidson): Details on credit quality increases and first-quarter margin outlook.
  Response: CFO Mark McCollum noted the credit quality increases were minor and from one transaction; NPA and NPL ratios remain very low. He suggested a starting margin of around 3.25%-3.27% for Q1 2026, with potential to build from there.

• Question from Tyler Cacciatori (Stephens Inc.): Size of the Qubix customer base.
  Response: CEO Sam Sidhu stated there are hundreds of customers, with the network expanding incrementally by adding counterparties and traditional finance nodes, which strengthens breadth and stickiness.

• Question from Tyler Cacciatori (Stephens Inc.): Update on regulatory order progress.
  Response: CEO Sam Sidhu indicated the bank is substantially done with its plan to address the order and aims to put it behind in 2026, with the Qubix network now serving as a massive competitive advantage.

• Question from David Bishop (Hovde Group LLC): Yields on new loan originations and competition in lending markets.
  Response: CFO Mark McCollum stated new commercial loan yields are between 225-275 basis points over Fed funds/SOFR, with competition being less impactful than their ability to drive down deposit costs versus peers.

• Question from Hal Goetsch (B. Riley Securities): Whether new payment rails cannibalize traditional wire/ACH business.
  Response: CEO Sam Sidhu clarified that new payment rails are currently incremental, not cannibalistic, and the focus is on helping customers utilize multiple channels, enhancing the overall network.

• Question from Hal Goetsch (B. Riley Securities): Sources of the bank's competitive advantage from Qubix.
  Response: CEO Sam Sidhu described the advantage as a barrier to entry, driven by a strong network effect, operational scale, and a robust risk/compliance infrastructure, making the market position stronger than before.

• Question from Hal Goetsch (B. Riley Securities): How AI is improving processes and efficiency.
  Response: CEO Sam Sidhu detailed AI initiatives in governance, data transformation, and workflow orchestration, aiming to automate onboarding, underwriting, and risk compliance, with a focus on full bank transformation through AI agents.

Contradiction Point 1

Deposit Growth Drivers and Qubix Contribution

Contradiction on whether Qubix is a primary driver for deposit growth.

What are the expectations for 2026 fee income growth and areas of optimism, and what deposit growth from Qubix is projected for 2026, along with the impact of institutional adoption of digital assets on this trend? - Janet Lee (TD Cowen)

2025Q4: Deposit growth guidance for 2026 is driven primarily by core commercial banking teams, not by significant contributions from Qubix digital asset balances. - Sam Sidhu(CEO)

What is the expected pace of deposit growth from new banking team hires in 2026, and is it sustainable or will saturation from 2024 hires be reached? - Sun Young Lee (TD Cowen)

2025Q3: The deposit growth pace from new teams (~$300-$400M per quarter) is expected to continue in 2026, supported by teams hired in 2023 and 2024. Newer teams (2025) will start adding balances in the first half of 2026 and ramp up, providing a ~25% lift to the base deposit growth. - Samvir Sidhu(President)

Contradiction Point 2

Non-Interest Income and Fee Income Strategy

Contradiction on the strategic focus regarding fees from the Qubix platform.

What are the expectations for fee income growth in 2026, where is the company most optimistic about this growth, what deposit growth is assumed from Qubix for 2026, and how is institutional adoption of digital assets impacting these trends? - Janet Lee (TD Cowen)

2025Q4: The focus is on better monetizing mature businesses. - Mark McCollum(CFO)

With upcoming rate cuts, will cubiX implement any fee increases? - Stephen Moss (Raymond James & Associates)

2025Q3: The bank will explore fees as it adds new products and partnerships, but for now, deposit growth is outpacing any asset sensitivity of noninterest-bearing deposits held in cash. - Samvir Sidhu(President)

Contradiction Point 3

Role of Regulatory Clarity/Act Legislation in Deposit Growth

Contradiction on whether legislative/regulatory milestones are a key driver for deposit growth.

What are the expectations for 2026 fee income growth, the areas of highest optimism, the projected deposit growth from Qubix, and the impact of institutional adoption on digital asset trends? - Janet Lee (TD Cowen)

2025Q4: The company is not counting on a major increase in digital asset activity from legislation. - Sam Sidhu(CEO)

Can you explain the $10 million benefit for the next two quarters and how the Genius Act influences your strategy for crypto-related deposits, especially with competition from stablecoin offerings by larger banks like JPMorgan and PNC? - Peter Winter (D.A. Davidson)

2025Q2: Regulatory clarity (like the Genius Act) has historically increased activity and deposits at the bank. - Samvir Sidhu(CEO)

Contradiction Point 4

Monetization Strategy and Fee Income Focus

Contradiction on the primary income driver from the Qubix platform.

What are the expectations for fee income growth in 2026, which areas are most optimistic, what deposit growth from Qubix is assumed, and how is institutional adoption of digital assets impacting this trend? - Janet Lee (TD Cowen)

2025Q4: The focus for 2026 is on better monetizing mature businesses. - Mark McCollum(CFO)

What were cubiX's deposits this quarter, and what's the growth potential and risk management approach? - Kelly Motta (KBW)

2025Q2: The goal is not to materially drive fees; majority of income is currently interest income. - Samvir Sidhu(CEO)

Contradiction Point 5

Growth Outlook for Qubix Deposits from New Verticals

Contradiction on the deposit growth contribution from new verticals in 2026.

What are the expectations for 2026 fee income growth and areas of optimism, the projected deposit growth from Qubix, and how is institutional adoption of digital assets impacting these trends? - Janet Lee (TD Cowen)

2025Q4: Deposit growth guidance for 2026 is driven primarily by core commercial banking teams, not by significant contributions from Qubix digital asset balances. - Sam Sidhu(CEO)

What was the size of cubiX deposits this quarter, and how do you assess the business's growth potential and risk management? - Kelly Motta (KBW)

2025Q2: Over time, the percentage of flow from traditional finance players is expected to increase. - Samvir Sidhu(CEO)