[8-K] First Internet Bancorp Reports Material Event
First Internet Bancorp disclosed that its bank subsidiary entered into an agreement with Blackstone Real Estate Debt Strategies affiliates to sell a performing single-tenant lease financing loan portfolio. The Agreement allowed sale of up to $869 million aggregate principal balance; following satisfaction of closing conditions the Bank completed a Sale of $836.9 million aggregate principal balance for net proceeds, after transaction costs, of $794.2 million.
The filing states $27.9 million of the Portfolio remains under review and may be sold later under the Agreement. The Company also entered into a servicing agreement under which it will continue to provide loan servicing and other administrative services for the loans sold. The summary in the filing is qualified by reference to the full Agreement, filed as an exhibit.
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Insights
TL;DR Sale of most of the loan portfolio generated substantial liquidity while retaining servicing revenue stream.
The transaction converted a large portion of performing lease financing loans into $794.2 million of net cash proceeds, materially increasing near-term liquidity on the balance sheet. Retaining servicing duties preserves recurring fee income and operational control over borrower interactions. The fact that $27.9 million remains subject to review introduces limited near-term uncertainty about the final portfolio size sold. The filing’s cross-reference to the full Agreement means investors should review Exhibit 10.1 for detailed covenants, indemnities, and pricing mechanics to assess credit risk transfer and any residual exposures.
TL;DR A large, structured loan sale to institutional buyers suggests a strategic balance-sheet optimization.
The Bank sold $836.9 million of performing single-tenant lease financing loans under a Loan Portfolio Purchase Agreement with Blackstone affiliates, receiving $794.2 million net. Such a sale typically reduces on-balance-sheet credit exposure and may free capital for growth or de-risking, while a servicing agreement keeps operational continuity. The remaining $27.9 million still under review could reflect repurchase, underwriting, or documentation contingencies; the Agreement exhibit should be reviewed for representations, warranties, purchase price adjustments, and servicing fee terms to understand long-term economics and any contingent liabilities.
