What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2023-03-01 compared with 2022-03-01 · 2138 added, 2151 removed, 1244 unchanged (78% of the section changed)

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SOFI TECHNOLOGIES, INC.

INDEX TO FINANCIAL STATEMENTS

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Financial Statements

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Business Combinations

Goodwill and Intangible Assets

Investments in AFS Debt Securities

Variable Interest Entities

Transfers of Financial Assets

Allowance for Credit Losses

Investment Securities

Securitization and Variable Interest Entities

Goodwill and Intangible Assets

Property, Equipment, Software and Leases

Other Assets and Other Liabilities

Derivative Financial Instruments

Fair Value Measurements

Temporary Equity

Permanent Equity

S hare -Based Compensation

Related Parties

Share-Based Compensation

Commitments, Guarantees, Concentrations and Contingencies

Loss Per Share

Business Segment Information

Business Segment and Geographic Information

Regulatory Capital

Parent Company Condensed Financial Information

Subsequent Events

SoFi Technologies, Inc.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

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In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2022 and 2021, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2022, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2022, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated March 1, 2023, expressed an unqualified opinion on the Company’s internal control over financial reporting.

Basis for Opinion

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Our responsibility is to express an opinion on the Company’s financial statements based on our audits.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

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Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting.

Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

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We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Fair Value Measurement — Valuation of Loans, Servicing Rights, Residual Investments, and Residual Interests Classified as Debt — Refer to Notes 1, 5, and 9 to the financial statements

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current-period audit of the financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Loans Held for Sale, at fair value— Refer to Notes 1, 4, and 15 to the financial statements

Critical Audit Matter Description

The Company has elected the fair value option to measure loans, servicing rights, residual investments, and measures residual interests classified as debt at fair value.

The Company determines the fair value of each of its financial assets using a discounted cash flow methodology, while also considering market data as it becomes available.

The Company classifies loans, servicing rights, residual investments, and residual interests classified as debt as Level 3 because the valuations utilize significant unobservable inputs.

The fair value measurement of loans, servicing rights, residual investments, and residual interests classified as debt involves judgements made by management, including the use of assumptions and estimates, some of which are unobservable and require significant judgement.

The Company has elected the fair value option to measure loans held for sale which are classified as Level 3 instruments because the valuations utilize significant unobservable inputs.

As of December 31, 2022, loans held for sale, at fair value, were $13.6 billion.

The Company determines the fair value of loans held for sale using a discounted cash flow calculation, which is a form of the income approach, while also considering market data as it becomes available.

Management estimates the future cash flows of each loan portfolio using key loan metrics and significant unobservable inputs.

The significant assumptions used in the valuation model include conditional prepayment rate, annual default rate and discount rate.

We identified loans held for sale, at fair value, as a critical audit matter because of the unobservable inputs management uses to estimate fair value.

This required a high degree of auditor judgment and an increased extent of effort, including the need to involve our fair value specialists.

SoFi Technologies, Inc.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the fair value measurement of loans, servicing rights, residual investments, and residual interests classified as debt included the following, among others:

• We performed inquiries with management and the Company’s third-party valuation expert to understand the process for developing, and assumptions used in, the valuation models.

Our audit procedures related to the fair value measurement of loans held for sale included the following, among others:

• We tested the effectiveness of internal controls over the fair value of loans held for sale, including management’s controls over the evaluation of the reasonableness of unobservable inputs used in the valuation.

• We evaluated the valuation models and the related assumptions, including significant unobservable inputs, and underlying loan data used by management and their third-party valuation expert.

• We tested the completeness and accuracy of the source information derived from the Company’s loan data, which is used in the valuation model.

• With the assistance of our fair value specialists, we developed independent fair value estimates and compared our estimates to the Company’s estimates.

Acquisition of Technisys S.A.

– Fair Value of Developed Technology and Customer-related Intangible Assets — Refer to Notes 1, 2 and 8 to the financial statements

Critical Audit Matter Description

The Company completed the acquisition of Technisys S.A.

(“Technisys”) on March 3, 2022.

The acquisition was accounted for as a business combination.

The Company accounts for acquisitions of entities or asset groups that qualify as businesses using the acquisition method of accounting.

Accordingly, the purchase consideration was allocated to the tangible and intangible assets acquired and liabilities assumed based on the estimated fair values as of the acquisition date, which are measured in accordance with fair value measurement principles.

The allocation of the total purchase consideration to the estimated fair values of the developed technology and customer-related intangible assets acquired was $187 million and $42 million, respectively.

Management used the Multi-Period Excess Earnings Method, a form of the income approach, to estimate the fair value of the developed technology.

The significant assumptions include:

(i) the estimated annual net cash flows, which are a function of expected earnings attributable to the asset (and include an assumed technology migration curve), and (ii) an assumed discount rate, which reflects the risk of the asset relative to the overall risk of Technisys.

Management used the With and Without Method, a form of the income approach, to value the customer-related intangible assets.

The significant assumptions include:

(i) the estimated net cash flows both with the existing customer base and without the existing customer base, which include assumptions regarding revenue ramp-up periods and retention rates, and (ii) an assumed discount rate, which reflects the risk of the asset relative to the overall risk of Technisys.

We identified the developed technology and customer-related intangible assets for Technisys as a critical audit matter because of the significant estimates and assumptions management made to determine the fair value of these assets.

This required a high degree of auditor judgment and an increased extent of effort, including the need to involve our fair value specialists, when performing audit procedures to evaluate the reasonableness of management’s estimates and assumptions.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the developed technology and customer-related intangible assets assumed for the Technisys acquisition included the following, among others:

• We assessed the reasonableness of management’s estimated net cash flows by inquiring of management regarding its processes for developing projected financial information and comparing the projections to historical results achieved by Technisys, historical results of the Company and other acquisitions completed in recent years, and comparable peer companies.

• We assessed the reasonableness of management’s assumption of the revenue ramp-up periods by evaluating Technisys’ historical growth trends, and testing the source information, including the number of existing customers through inspection of customer contracts.

• We assessed the reasonableness of management’s assumption of the retention rates by evaluating Technisys’ historical retention rate, including testing of the source information, and comparing the retention rate to historical results achieved by comparable peer companies.

SoFi Technologies, Inc.

• With the assistance of our fair value specialists, we evaluated:

◦ the reasonableness of the income approach valuation methodologies by assessing management’s application of the Multi-Period Excess Earnings Method and the With and Without Method,

◦ the reasonableness of the technology migration curve and discount rates used in the valuation by developing a range of independent estimates and comparing those to the assumptions selected by management, and

◦ the mathematical accuracy of the valuation analysis.

Goodwill — Galileo Reporting Unit - Refer to Notes 1 and 8 to the financial statements

Critical Audit Matter Description

The Company tests goodwill for impairment at the reporting unit level annually or whenever indicators of impairment exist.

The Company’s evaluation of goodwill for impairment involves the comparison of the fair value of each reporting unit to its carrying amount.

The Company performed a quantitative goodwill impairment assessment on the Galileo reporting unit using a combination of a discounted cash flow (“DCF”) calculation, which is a form of the income approach, and a market multiples calculation, which is a form of the market approach.

As of December 31, 2022, the Company had a goodwill balance of $1.62 billion, of which $1.59 billion was attributable to the Technology Platform reportable segment, which includes the Galileo reporting unit.

The fair value of the Galileo reporting unit exceeded its carrying value as of the measurement date and, therefore, no impairment was recognized.

We identified goodwill for the Galileo reporting unit as a critical audit matter because of the significant estimates and assumptions made by management to estimate the fair value of Galileo used in the quantitative impairment assessment.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the significant estimates and assumptions made by management to estimate the fair value of Galileo used in the quantitative impairment assessment included the following, among others:

• We tested the effectiveness of internal controls over the Company’s evaluation of goodwill for impairment.

• With the assistance of our fair value specialists, we evaluated the appropriateness of the methodology and reasonableness of the significant estimates and assumptions.

/s/ Deloitte & Touche LLP

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SoFi Technologies, Inc.

Consolidated Balance Sheets

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Restricted cash and restricted cash equivalents 424,395 273,726

Investment securities (includes available-for-sale securities of $ 195,438 and $ 194,907 at fair value with associated amortized cost of $ 203,418 and $ 195,796 as of December 31, 2022 and 2021, respectively)

396,769 569,595

Investments in available-for-sale securities (amortized cost of $ 195,796 and $ 0 , respectively)

Loans, less allowance for credit losses on loans at amortized cost of $ 7,037 and $ 219 , respectively (1)(2)

Loans held for sale, at fair value 13,557,074 5,952,972

Loans held for investment (less allowance for credit losses on loans at amortized cost of $ 40,788 and $ 7,037 as of December 31, 2022 and 2021, respectively)

307,957 115,912

Servicing rights 149,854 168,259

Securitization investments 374,688 496,935

Equity method investments — 19,739

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Operating lease right-of-use assets 97,135 115,191

Related party notes receivable — 17,923

Other assets, less allowance for credit losses of $ 2,292 and $ 562 , respectively

Other assets (less allowance for credit losses of $ 2,785 and $ 2,292 as of December 31, 2022 and 2021, respectively)

417,334 171,242

Total assets $ 19,007,675 $ 9,176,326

Liabilities, temporary equity and permanent equity (deficit)

Liabilities, temporary equity and permanent equity

Noninterest-bearing deposits $ 76,504 $ —

Interest-bearing deposits 7,265,792 —

Total deposits 7,342,296 —

Accounts payable, accruals and other liabilities 516,215 298,164

$ 298,164 $ 452,909

Operating lease liabilities 117,758 138,794

3,947,983 4,798,925

Debt 5,485,882 3,947,983

Residual interests classified as debt 17,048 93,682

93,682 118,298

Total liabilities 13,479,199 4,478,623

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320,374 320,374

Permanent equity (deficit):

Permanent equity:

Common stock, $ 0.00 par value:

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Accumulated deficit ( 1,503,521 ) ( 1,183,114 )

Total permanent equity (deficit) 4,377,329 ( 120,115 )

Total liabilities, temporary equity and permanent equity (deficit) $ 9,176,326 $ 8,563,499

Total permanent equity 5,208,102 4,377,329

Total liabilities, temporary equity and permanent equity $ 19,007,675 $ 9,176,326

__________________

(1) Financial statement line items include amounts in consolidated variable interest entities (“VIEs”).

(2) As of December 31, 2021 and 2020, includes loans measured at fair value of $ 5,952,972 and $ 4,859,068 , respectively, and loans measured at amortized cost of $ 115,912 and $ 20,235 , respectively.

See Note 1, Note 5, Note 8 and Note 9.

(3) Redemption amounts are $ 323,400 and $ 3,210,470 as of December 31, 2021 and 2020, respectively.

(4) Includes 100,000,000 non-voting common shares authorized and no non-voting common shares issued and outstanding as of December 31, 2021, and 8,714,000 shares authorized and 2,406,549 shares outstanding as of December 31, 2020.

(1) Redemption amount is $ 323,400 as of December 31, 2022 and 2021.

(2) Includes 100,000,000 non-voting common shares authorized and no non-voting common shares issued and outstanding as of December 31, 2022 and 2021.

See Note 13 for additional information.

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SoFi Technologies, Inc.

Consolidated Balance Sheets (Continued)

(In Thousands, Except for Share Data)

The following table presents the assets and liabilities of consolidated variable interest entities (“VIEs”) which are included in our consolidated balance sheets.

The assets in the below table may only be used to settle obligations of consolidated VIEs and are in excess of those obligations as of the dates presented.

Additionally, the assets and liabilities in the table below exclude intercompany balances, which eliminate upon consolidation.

Restricted cash and restricted cash equivalents $ 68,151 $ 53,161

Loans held for sale, at fair value 931,701 808,904

Total assets $ 999,852 $ 862,065

Accounts payable, accruals and other liabilities $ 3,053 $ 388

Debt 771,454 660,419

Residual interests classified as debt 17,048 93,682

Total liabilities $ 791,555 $ 754,489

The accompanying notes are an integral part of these consolidated financial statements.

SoFi Technologies, Inc.

Consolidated Statements of Operations and Comprehensive Loss

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10,433 14,109 24,031

Related party notes

13,867 3,049 9,153

2,838 5,964 11,210

Total interest income 773,371 355,020 363,537

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110,127 90,485 155,150

Deposits 59,793 — —

Corporate borrowings 18,438 10,345 27,974

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43,547 ( 2,281 ) ( 19,426 )

Technology platform fees

Technology products and solutions

304,901 191,847 90,128

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SoFi Technologies, Inc.

Consolidated Statements of Changes in Temporary Equity and Permanent Equity (Deficit)

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Common Stock Additional

Capital Treasury

Stock Accumulated

Capital Accumulated

Comprehensive

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Balance at January 1, 2020 69,040,750 $ — $ 135,517 $ ( 21 ) $ ( 474,558 ) $ ( 339,062 ) 404,170,765 $ 2,439,731

Retroactive conversion of shares due to Business Combination 30,371,595 — — — — — — 170,868,620 —

Balance at January 1, 2019, as converted 71,259,580 — 157,647 ( 2,914 ) ( 12 ) ( 223,143 ) ( 68,422 ) 370,224,316 1,890,554

Share-based compensation expense — — 99,870 — — 99,870 — —

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Exercise of common stock options 2,039,000 — 3,781 — — 3,781 — —

Common stock purchases ( 1,774,479 ) — — — — ( 8,804 ) ( 8,804 ) — —

Redeemable preferred stock dividends — — ( 23,923 ) — — — ( 23,923 ) — —

Constructive retirement of treasury shares ( 8,223,111 ) — — 2,914 — ( 2,914 ) — — —

Note receivable issuance to stockholder, inclusive of interest — — ( 61,214 ) — — — ( 61,214 ) — —

Note receivable payments from stockholder, inclusive of interest — — 15,155 — — — 15,155 — —

Issuance of redeemable preferred stock — — — — — — — 33,946,449 551,577

Preferred stock issuance costs — — — — — — — — ( 2,400 )

Net loss — — — — — ( 239,697 ) ( 239,697 ) — —

Other comprehensive loss, net — — — — ( 9 ) — ( 9 ) — —

Balance at December 31, 2019, as converted 69,040,750 $ — $ 135,517 $ — $ ( 21 ) $ ( 474,558 ) $ ( 339,062 ) 404,170,765 $ 2,439,731

Share-based compensation expense — — 99,870 — — — 99,870 — —

Equity-based payments to non-employees 130,710 — 908 — — — 908 — —

Vesting of RSUs 11,528,031 — — — — — — — —

Stock withheld related to taxes on vested RSUs ( 4,431,964 ) — ( 31,259 ) — — — ( 31,259 ) — —

Exercise of common stock options 2,039,000 — 3,781 — — — 3,781 — —

Vested stock options assumed in acquisition — — 32,197 — — 32,197 — —

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Net loss — — — — ( 224,053 ) ( 224,053 ) — —

Other comprehensive loss, net — — — — ( 145 ) — ( 145 ) — —

Balance at December 31, 2020, as converted 115,084,358 $ — $ 579,228 $ — $ ( 166 ) $ ( 699,177 ) $ ( 120,115 ) 469,150,522 $ 3,173,686

Other comprehensive loss, net of taxes — — — ( 145 ) — ( 145 ) — —

Balance at December 31, 2020 115,084,358 $ — $ 579,228 $ ( 166 ) $ ( 699,177 ) $ ( 120,115 ) 469,150,522 $ 3,173,686

Share-based compensation expense — — 246,787 — — 246,787 — —

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Net loss — — — — ( 483,937 ) ( 483,937 ) — —

Other comprehensive loss, net — — — — ( 1,305 ) — ( 1,305 ) — —

Other comprehensive loss, net of taxes — — — ( 1,305 ) — ( 1,305 ) — —

Balance at December 31, 2021 828,154,462 $ 83 $ 5,561,831 $ ( 1,471 ) $ ( 1,183,114 ) $ 4,377,329 3,234,000 $ 320,374

Share-based compensation expense — — 328,571 — — 328,571 — —

Equity-based payments to non-employees 100,000 — — — — — — —

Vesting of RSUs 23,183,000 2 ( 2 ) — — — — —

Stock withheld related to taxes on vested RSUs ( 1,196,691 ) — ( 8,983 ) — — ( 8,983 ) — —

Exercise of common stock options 1,955,031 — 2,610 — — 2,610 — —

Issuance of common stock in acquisition 81,700,318 8 873,369 — — 873,377 — —

Vested awards assumed in acquisition — — 2,855 — — 2,855 — —

Redeemable preferred stock dividends — — ( 40,425 ) — — ( 40,425 ) — —

Net loss — — — — ( 320,407 ) ( 320,407 ) — —

Other comprehensive loss, net of taxes — — — ( 6,825 ) — ( 6,825 ) — —

Balance at December 31, 2022 933,896,120 $ 93 $ 6,719,826 $ ( 8,296 ) $ ( 1,503,521 ) $ 5,208,102 3,234,000 $ 320,374

The accompanying notes are an integral part of these consolidated financial statements.

SoFi Technologies, Inc.

Consolidated Statements of Cash Flows

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Adjustments to reconcile net loss to net cash used in operating activities:

Share-based compensation expense 305,994 239,011 99,870

Depreciation and amortization 151,360 101,568 69,832

Deferred debt issuance and discount expense 18,292 18,292 28,310

Share-based compensation expense 239,011 99,870 60,936

Equity-based payments to non-employees 360 908 483

Provision for credit losses 54,332 7,573 —

Deferred income taxes ( 3,498 ) 1,204 ( 104,504 )

Equity method investment earnings 261 ( 4,314 ) ( 869 )

Accretion of seller note interest expense — 6,002 —

Fair value changes in residual interests classified as debt 6,608 22,802 38,216

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Fair value changes in warrant liabilities — 107,328 20,525

Fair value adjustment to related party notes receivable ( 169 ) 319 —

Equity method investment earnings — 261 ( 4,314 )

Accretion of seller note interest expense — — 6,002

Other 13,426 ( 12,467 ) 2,030

Changes in operating assets and liabilities:

Originations and purchases of loans ( 13,500,706 ) ( 10,406,813 ) ( 11,579,679 )

Proceeds from sales and repayments of loans 12,202,525 9,949,805 11,635,228

Other changes in loans ( 10,148 ) ( 58,743 ) 69,214

Changes in loans held for sale, net ( 7,463,474 ) ( 1,308,329 ) ( 515,751 )

Servicing assets 18,405 ( 18,662 ) 52,021

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Purchases of property, equipment, software and intangible assets $ ( 93,201 ) $ ( 52,261 ) $ ( 24,549 )

Related party notes receivable issuances — ( 7,643 ) ( 9,050 )

Proceeds from repayment of related party notes receivable 16,693 — —

Capitalized software development costs ( 10,532 ) — —

Purchases of available-for-sale investments ( 44,974 ) ( 246,372 ) —

Proceeds from sales of available-for-sale investments 23,497 52,742 —

Proceeds from maturities of available-for-sale investments 4,799 — —

Purchases of non-securitization investments ( 22,000 ) ( 145 ) ( 3,608 )

Proceeds from non-securitization investments 109,534 974 —

Proceeds from maturities and paydowns of available-for-sale investments 15,240 4,799 —

Changes in loans held for investment, net ( 173,728 ) — —

Proceeds from securitization investments 118,825 247,058 322,704

Acquisition of business, net of cash acquired — ( 32,392 ) —

Net cash provided by investing activities $ 110,193 $ 258,949 $ 114,868

Proceeds from non-securitization investments — 109,534 974

Purchases of non-securitization investments — ( 22,000 ) ( 145 )

Acquisition of businesses, net of cash acquired 58,540 — ( 32,392 )

Related party notes receivable issuances — — ( 7,643 )

Proceeds from repayment of related party notes receivable — 16,693 —

Net cash (used in) provided by investing activities $ ( 106,333 ) $ 110,193 $ 258,949

The accompanying notes are an integral part of these consolidated financial statements.

SoFi Technologies, Inc.

Consolidated Statements of Cash Flows (Continued)

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Financing activities

Proceeds from debt issuances $ 9,521,314 $ 10,234,378 $ 12,458,120

Repayment of debt ( 10,429,176 ) ( 9,708,991 ) ( 12,826,085 )

Net change in debt facilities $ 1,418,456 $ ( 1,186,880 ) $ 1,088,857

Proceeds from other debt issuances 439,990 1,191,908 547,058

Repayment of other debt ( 516,363 ) ( 912,890 ) ( 1,110,528 )

Payment of debt issuance costs ( 8,287 ) ( 9,465 ) ( 16,443 )

Purchase of capped calls ( 113,760 ) — —

Net change in deposits 7,152,975 — —

Taxes paid related to net share settlement of share-based awards ( 8,983 ) ( 42,644 ) ( 31,259 )

Proceeds from stock option exercises 2,610 25,154 3,781

Payment of redeemable preferred stock dividends ( 40,425 ) ( 40,426 ) ( 40,536 )

Finance lease principal payments ( 488 ) ( 516 ) ( 489 )

Purchases of common stock — ( 526 ) ( 40 )

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Payment of costs directly attributable to the issuance of common stock in connection with Business Combination and PIPE Investment — ( 26,951 ) —

Proceeds from stock option exercises 25,154 3,781 7,844

Proceeds from warrant exercises — 95,047 —

Payment of redeemable preferred stock dividends ( 40,426 ) ( 40,536 ) ( 23,923 )

Purchase of capped calls — ( 113,760 ) —

Payment of deferred equity costs — ( 56 ) —

Finance lease principal payments ( 516 ) ( 489 ) —

Note receivable issuance to stockholder — — ( 58,000 )

Note receivable principal repayments from stockholder — 43,513 14,487

Proceeds from common stock issuances — — 369,840

Proceeds from redeemable preferred stock issuances — — 573,845

Payment of redeemable preferred stock issuance costs — — ( 2,400 )

Note receivable principal repayments from stockholder — — 43,513

Net cash provided by financing activities $ 8,439,485 $ 684,987 $ 853,754

Effect of exchange rates on cash and cash equivalents 571 46 ( 145 )

Net (decrease) increase in cash, cash equivalents, restricted cash and restricted cash equivalents ( 554,991 ) 633,222 153,203

Net increase (decrease) in cash, cash equivalents, restricted cash and restricted cash equivalents $ 1,077,865 $ ( 554,991 ) $ 633,222

Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of period 768,437 1,323,428 690,206

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SoFi Technologies, Inc.

Consolidated Statements of Cash Flows (Continued)

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Supplemental non-cash investing and financing activities

Securitization investments acquired via loan transfers $ 118,274 $ 151,768 $ 351,254

Non-cash property, equipment, software and intangible asset additions 1,930 358 15,247

Available-for-sale investments securities purchased but unpaid 7,457 — —

Share-based compensation capitalized related to internally-developed software 7,776 — —

Third party warrants acquired with earnings initially deferred 964 — —

Loans held for investment received in acquisition $ 84,485 $ — $ —

Deposits assumed in acquisition 158,016 — —

Debt assumed in acquisition 2,000 — 5,832

Available-for-sale securities received in acquisition 10,014 — —

Derecognition of securitization investments 40,933 — —

Property, equipment and software acquired in acquisition 3,192 — 2,026

Non-cash loan reduction 1,798 — —

Deferred debt issuance costs accrued but unpaid 413 925 1,600

Costs directly attributable to the issuance of common stock paid in 2020 588 — —

Reduction to temporary equity associated with purchase price adjustments 743 — —

Conversion of temporary equity into permanent equity in conjunction with the Business Combination 2,702,569 — —

Deconsolidation of residual interests classified as debt — 101,718 97,928

Deconsolidation of securitization debt 99,695 — 770,918

Deconsolidation of residual interests classified as debt — — 101,718

Securitization investments acquired via loan transfers — 118,274 151,768

Costs directly attributable to the issuance of common stock paid in prior year — 588 —

Seller note issued in acquisition — — 243,998

Redeemable preferred stock issued in acquisition — 814,156 —

Redeemable preferred stock warrants accounted for as liabilities — — 22,268

Common stock options assumed in acquisition — 32,197 —

Issuance of common stock in acquisition — 15,565 —

Finance lease right-of-use assets acquired — 15,100 —

Property, equipment and software acquired in acquisition — 2,026 —

Debt assumed in acquisition — 5,832 —

Issuance of residual interests classified as debt as consideration for loan additions — — 116,906

Accrued but unpaid deferred equity costs — 56 —

Redeemed but unpaid common stock — — 526

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SoFi Technologies, Inc.

Notes to Consolidated Financial Statements

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The transactions contemplated in the Agreement are collectively referred to as the “Business Combination”.

See Note 2 for additional information on the Business Combination.

SoFi is a financial services platform that was founded in 2011 to offer an innovative approach to the private student loan market by providing student loan refinancing options.

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Lending, Technology Platform and Financial Services.

Since its founding, SoFi has expanded its lending strategy to offer home loans, personal loans and credit cards.

The Company has also developed non-lending financial products, such as money management and investment product offerings, and has also leveraged its financial services platform to empower other businesses.

Through strategic acquisitions, the Company expanded its investment product offerings into Hong Kong, and also operates as a platform-as-a-service for a variety of financial service providers, providing the infrastructure to facilitate core client-facing and back-end capabilities, such as account setup, account funding, direct deposit, authorizations and processing, payments functionality and check account balance features.

For additional information on these business combinations, see Note 2.

Since its founding, SoFi has expanded its lending and financial services strategy to offer personal loans, home loans and credit cards.

The Company also developed additional financial products, such as money management and investment product offerings, and has also leveraged its financial services platform to empower other businesses.

The Company has continued to expand its product offerings through strategic acquisitions.

During 2020, the Company expanded its investment product offerings into Hong Kong through the acquisition of 8 Limited, and also began to operate as a platform-as-a-service for a variety of financial service providers, providing the infrastructure to facilitate core client-facing and back-end capabilities, such as account setup, account funding, direct deposit, authorizations and processing, payments functionality and check account balance features through the acquisition of Galileo.

During 2022, the Company became a bank holding company and began operating as SoFi Bank, National Association, through its acquisition of Golden Pacific Bancorp, Inc., and expanded its platform to include a cloud-native digital and core banking platform with customers in Latin America through its acquisition of Technisys S.A., allowing the Company to expand its technology platform services to a broader international market.

For additional information on our recent business combinations, see Note 2.

For additional information on our reportable segments, see Note 20.

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All intercompany accounts were eliminated in consolidation.

The consolidated financial statements were prepared in conformity with accounting principles generally accepted in the United States (“GAAP”) and in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”).

As a result of the Business Combination completed on May 28, 2021, prior period share and per share amounts presented in the accompanying consolidated financial statements and these related notes have been retroactively converted in accordance with Accounting Standards Codification (“ASC”) 805, Business Combinations .

See Note 2 for additional information.

In our consolidated financial statements, we made the following presentation changes in 2022:

• in our consolidated balance sheets, (i) combined the financial statement line items for investments in available-for-sale securities and securitization investments and presented within investment securities, and (ii) broke out the financial statement line item loans into loans held for sale and loans held for investment ;

• in our consolidated statements of operations and comprehensive income (loss), (i) reclassified amounts within the financial statement line item interest income—related party notes to interest income—other , as the balances were immaterial for separate presentation, and (ii) renamed the financial statement line item for noninterest income—technology platform fees to noninterest income—technology products and solutions to accommodate noninterest income earned from Technisys.

See Note 3 for our presentation of disaggregated revenue and Note 2 for our discussion of business combinations;

• in our consolidated statements of cash flows, (i) reclassified amounts related to the provision for credit losses to a separate financial statement line item from other within the adjustments to reconcile net loss to net cash used in operating activities , (ii) combined amounts in prior years separately disclosed under the captions equity-based payments to non-employees and fair value adjustment to related party notes receivable into other within the adjustments to reconcile net cash to net cash used in operating activities , as they were immaterial individually and in aggregate and did not recur, and (iii) netted the financial statement line items for originations and purchase of loans

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

with proceeds from sales and repayments of loans and presented within changes in loans held for sale, net within cash flows from operating activities, consistent with industry practice.

In all instances, the respective prior period amounts were recast to conform to the current period presentation.

Use of Judgments, Assumptions and Estimates

The preparation of our consolidated financial statements and related disclosures in conformity with GAAP requires management to make assumptions and estimates that affect the amounts reported in our consolidated financial statements and accompanying notes.

Management bases its estimates on historical experience and on various other factors it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of our assets and liabilities.

These judgments, assumptions and estimates include, but are not limited to, the following:

(i) fair value measurements;

(ii) share-based compensation expense;

(iii) consolidation of variable interest entities;

and (iv) business combinations.

These judgments, estimates and assumptions are inherently subjective in nature and, therefore, actual results may differ from our estimates and assumptions.

The preparation of our consolidated financial statements and related disclosures in conformity with GAAP requires management to make assumptions and estimates that affect the reported amounts of assets, liabilities, revenue, expenses, and the disclosures of contingent assets and liabilities.

These estimates and assumptions are inherently subjective in nature and, therefore, actual results may differ from our estimates and assumptions, and the differences could be material.

Management bases its estimates on historical experience and on various other factors it believes to be reasonable under the circumstances.

These assumptions and estimates include, but are not limited to, the following:

(i) fair value measurements, (ii) business combinations, and (iii) goodwill.

Business Combinations

We account for acquisitions of entities or asset groups that qualify as businesses using the acquisition method of accounting in accordance with ASC 805, Business Combinations (“ASC 805”).

Purchase consideration is allocated to the tangible and intangible assets acquired and liabilities assumed based on the estimated fair values as of the acquisition date, which are measured in accordance with the principles outlined in ASC 820, Fair Value Measurement (“ASC 820”).

We account for acquisitions of entities or asset groups that qualify as businesses using the acquisition method of accounting.

The determination of fair value requires management to make estimates about discount rates, future expected cash flows, market conditions and other future events that are highly subjective in nature.

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Acquisition-related costs are expensed as incurred.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

During the measurement period, which may be up to one year from the acquisition date, we may record adjustments to the allocation of purchase consideration and to the fair values of assets acquired and liabilities assumed to the extent that additional information becomes available.

After this period, any subsequent adjustments are recorded in the consolidated statements of operations and comprehensive income (loss).

The Business Combination with SCH during the year ended December 31, 2021 was accounted for as a reverse recapitalization.

See Note 2 for additional information.

Consolidation of Variable Interest Entities

Variable Interest Entities

We enter into arrangements in which we originate loans, establish a special purpose entity (“SPE”), and transfer loans to the SPE.

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To determine if we are the primary beneficiary, we identify the most significant activities and determine who has the power over those activities, and who absorbs the variability in the economics of the VIE.

As of December 31, 2021 and 2020, we had 13 and 15 consolidated VIEs, respectively, on our consolidated balance sheets.

Refer to Note 6 for more details regarding our consolidated VIEs.

We periodically reassess our involvement with each VIE in which we have a variable interest.

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There are no liquidity arrangements, guarantees or other commitments by third parties that may affect the fair value or risk of our variable interests in consolidated VIEs.

Refer to Note 7 for more details regarding our consolidated VIEs.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

Fair Value Measurements

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Instruments are categorized in Level 3 of the fair value hierarchy based on the significance of unobservable factors in the overall fair value measurement.

As a result, the related gains and losses for assets

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

and liabilities within the Level 3 category presented in Note 9 may include changes in fair value that are attributable to both observable and unobservable inputs.

As a result, the related gains and losses for assets and liabilities within the Level 3 category presented in Note 15 may include changes in fair value that are attributable to both observable and unobservable inputs.

Transfers of Financial Assets

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Cash proceeds received from these transfers are reported as liabilities, with related interest expense recognized over the life of the related secured borrowing.

As a component of the loan sale agreements, we make certain representations to third parties that purchase our previously-held loans, some of which include Federal National Mortgage Association (“FNMA”) repurchase requirements and all of which are standard in nature and do not constrain our ability to recognize a sale for accounting purposes.

As a component of the loan sale agreements, we make certain representations to third parties that purchase our previously-held loans, some of which include Government-Sponsored Enterprises (“GSE”) repurchase requirements and all of which are standard in nature and do not constrain our ability to recognize a sale for accounting purposes.

Any significant estimated post-sale obligations or contingent obligations to the purchaser of the loans arising from these representations are accrued if probable and estimable.

Pursuant to ASC 460, Guarantees (“ASC 460”), we establish a loan repurchase liability, which is based on historical experience and any current developments which would make it probable that we would buy back loans previously sold to third parties at the historical sales price.

The loan repurchase liability is presented within accounts payable, accruals and other liabilities in the consolidated balance sheets, with the corresponding charges recorded within noninterest income—loan origination and sales in the consolidated statements of operations and comprehensive income (loss).

We establish a loan repurchase liability, which is based on historical experience and any current developments which would make it probable that we would buy back loans previously sold to third parties at the historical sales price.

The loan repurchase liability is presented within accounts payable, accruals and other liabilities in the

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

consolidated balance sheets, with the corresponding charges recorded within noninterest income—loan origination and sales in the consolidated statements of operations and comprehensive income (loss).

Cash and Cash Equivalents

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Restricted Cash and Restricted Cash Equivalents

Restricted cash and restricted cash equivalents consist primarily of cash deposits, certificate of deposit accounts held on reserve, money market funds held by consolidated VIEs, funds reserved for committed stock purchases, and collection balances.

These accounts are earmarked as restricted because these balances are either member balances held in our custody, cash segregated for regulatory purposes associated with brokerage activities, escrow requirements for certain debt facilities and derivative agreements, deposits required by various bank holding companies we partner with (“Member Banks”) that support one or more of our products, loan collection balances awaiting disbursement, consolidated VIE cash balances that we cannot use for general operating purposes, or other legally restricted balances.

Investments in Debt Securities

In the third quarter of 2021, we began investing in debt securities.

The accounting and measurement framework for our investments in debt securities is determined based on the security classification.

We classify investments in debt securities as

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

available-for-sale (“AFS”) when we do not have an intent and ability to hold the securities until maturity.

We do not hold investments in debt securities for trading purposes.

As of December 31, 2021, all of our investments in debt securities were classified as AFS.

Hereafter, these investments are referred to as “investments in AFS debt securities”.

We record investments in AFS debt securities at fair value in our consolidated balance sheets, with unrealized gains and losses recorded, net of tax, as a component of accumulated other comprehensive income (loss) (“AOCI”).

See Note 9 for additional information on our fair value estimates for investments in AFS debt securities.

The amortized cost basis of our investments in AFS debt securities reflects the security’s acquisition cost, adjusted for amortization of premium or accretion of discount, and net of deferred fees and costs, collection of cash and charge-offs, as applicable.

For purposes of determining gross realized gains and losses on AFS debt securities, the cost of securities sold is based on specific identification.

We elected to present accrued interest for AFS debt securities within investments in available-for-sale securities in the consolidated balance sheets.

Purchase discounts, premiums, and other basis adjustments for investments in AFS debt securities are generally amortized into interest income over the contractual life of the security using the effective interest method.

However, premiums on certain callable debt securities are amortized to the earliest call date.

Amortization of premiums and discounts and other basis adjustments for investments in AFS debt securities, as well as interest income earned on the investments, are recognized within interest income—other , and realized gains and losses on investments in AFS debt securities are recognized within noninterest income—other in the consolidated statements of operations and comprehensive income (loss).

As of December 31, 2021, our investments in AFS debt securities portfolio included agency to-be-announced (“TBA”) securities, which are securities that will be delivered under the purchase contract at a later date when the underlying security is issued.

We made a policy election to account for contracts to purchase or sell existing securities on a trade-date basis and, as such, we record the purchase at inception of the contract on a gross basis, with the offsetting payable for the settlement amount recorded within accounts payable, accruals and other liabilities in the consolidated balance sheets.

In accordance with ASC 326-30, Financial Instruments—Credit Losses—Available-For-Sale Debt Securities , an investment in AFS debt security is considered impaired if its fair value is less than its amortized cost.

If we determine that we have the intent to sell the impaired investment in AFS debt security, or if it is more likely than not that we will be required to sell the impaired investment in AFS debt security before recovery of its amortized cost, we recognize the full impairment loss reflecting the difference between the amortized cost (net of any prior recognized allowance) and the fair value of the investment in AFS debt security within noninterest income—other in the consolidated statements of operations and comprehensive income (loss).

If neither of the above conditions exists, we evaluate whether the impairment loss is attributable to credit-related or non-credit-related factors.

Any impairment that is not credit-related is recognized in other comprehensive income (loss) , net of taxes.

See “Allowance for Credit Losses” below for the factors we consider in identifying credit-related impairment and the treatment of credit losses.

See Note 4 for additional information on our investments in AFS debt securities.

As of December 31, 2021, our loan portfolio consisted of personal loans, student loans and home loans, which are measured at fair value, and credit card loans, which are measured at amortized cost.

As of December 31, 2020, we also had a commercial loan, which is further discussed below.

Loans Measured at Fair Value

Our personal loans, student loans and home loans are carried at fair value on a recurring basis and, therefore, all direct fees and costs related to the origination process are recognized in earnings as earned or incurred.

We elected the fair value option to measure these loans, as we believe that fair value best reflects the expected economic performance of the loans, as well as our intentions given our gain-on-sale origination model.

Restricted cash and restricted cash equivalents primarily include cash deposits, certificate of deposit accounts held on reserve, money market funds held by consolidated VIEs and collection balances.

These accounts are earmarked as restricted because the balances are either member balances held in our custody, cash segregated for regulatory purposes associated with brokerage activities, escrow requirements for certain debt facilities and derivative agreements, deposits required by various bank holding companies we partner with (“Member Banks”) that support one or more of our products, loan collection balances awaiting disbursement, consolidated VIE cash balances that we cannot use for general operating purposes, or other legally restricted balances.

Our loan portfolio primarily consists of:

(i) personal loans, student loans and home loans, which are held for sale and measured at fair value, and (ii) credit cards, and commercial and consumer banking loans, which are held for investment and measured at amortized cost.

The commercial and consumer banking portfolio is primarily inclusive of commercial real estate loans, commercial and industrial loans and residential real estate and other consumer loans.

Loans Held for Sale

Loans that we have the intent and ability to sell to third-party purchasers are classified as held for sale.

We elected the fair value option to measure our personal loans, student loans and home loans, as we believe that fair value best reflects the expected economic performance of the loans, as well as our intentions given our primary gain-on-sale origination model.

Therefore, these loans are carried at fair value on a recurring basis.

Loans do not trade in an active market with readily observable prices.

We determine the fair value of our loans using a discounted cash flow methodology, while also considering market data as it becomes available.

Direct fees, which primarily relate to home loan originations, are recognized in earnings as earned and are recorded within noninterest income—loan origination and sales in the consolidated statements of operations and comprehensive income (loss).

Direct loan origination costs are recognized in earnings as incurred and are recorded within noninterest expense—cost of operations in the consolidated statements of operations and comprehensive income (loss).

We record the initial fair value measurement and subsequent measurement changes in fair value in the period in which the changes occur within noninterest income—loan origination and sales in the consolidated statements of operations and comprehensive income (loss).

Our consolidated loans are originated with the intention to sell to third-party purchasers and are, therefore, considered held for sale.

We record cash flows related to loans held for sale within cash flows from operating activities in the consolidated statements of cash flows.

Securitized loans are assets held by consolidated SPEs as collateral for bonds issued, for which fair value changes are recorded within noninterest income—securitizations in the consolidated statements of operations and comprehensive income (loss).

Gains or losses recognized upon deconsolidation of a VIE are also recorded within noninterest income—securitizations .

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

Loans do not trade in an active market with readily observable prices.

We determine the fair value of our loans using a discounted cash flow methodology, while also considering market data as it becomes available.

We classify loans as Level 3 because the valuations utilize significant unobservable inputs.

We consider a loan to be delinquent when the borrower has not made the scheduled payment amount within one day after the scheduled payment date, provided the borrower is not in school or in deferment, forbearance or within an agreed-upon grace period.

Loan deferment is a provision in the student loan contract that permits the borrower to defer payments while enrolled at least half time in school.

Loan deferment is a provision within student loan contracts that permits the borrower to defer payments while enrolled at least half time in school.

During the deferment period, interest accrues on the loan balance and is capitalized to the loan when the loan enters repayment status, which begins when the student no longer qualifies for deferment.

Whereas deferment only relates to student loans, forbearance applies to student loans, personal loans and home loans.

Forbearance applies to student loans, personal loans and home loans.

A borrower in repayment may generally request forbearance for reasons including a FEMA-declared disaster, unemployment, economic hardship or general economic uncertainty.

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At the conclusion of a forbearance period, the contractual monthly payment is recalculated and is generally higher as a result.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

For personal loans and student loans, delinquent loans are charged off after 120 days of delinquency or on the date of confirmed loss.

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For all loans, we stop accruing interest and reverse all accrued but unpaid interest on the date of charge-off.

Additional information about our loans measured at fair value is included in Note 5 through Note 7, as well as Note 9.

Loans Measured at Amortized Cost

As of December 31, 2021, loans measured at amortized cost included credit card loans.

We launched our credit card product in the third quarter of 2020, which was expanded to a broader market in the fourth quarter of 2020.

During the fourth quarter of 2020, we also issued a commercial loan, which was repaid in January 2021.

For loans measured at amortized cost, we present accrued interest within loans in the consolidated balance sheets.

Additional information about our loans held for sale is included in Note 4, Note 7 and Note 15.

Loans Held for Investment

For our commercial and consumer banking loans, direct loan origination costs are deferred and amortized using the effective interest method over the contractual term of the loans within interest income—loans in the consolidated statements of operations and comprehensive income (loss).

As of December 31, 2022, the remaining balance of deferred costs was immaterial.

We present accrued interest for loans held for investment within loans held for investment in the consolidated balance sheets.

We record cash flows related to loans held for investment within cash flows from investing activities in the consolidated statements of cash flows.

Credit card balances are reported as delinquent when they become 30 or more days past due.

Credit card balances are charged off after 180 days of delinquency or on the date of the confirmed loss, at which time we stop accruing interest and fees and reverse all accrued but unpaid interest and fees through interest income as of such date.

When a credit card balance is charged off, we record a reduction to the allowance and the credit card balance.

When recovery payments are received against charged off credit card balances, we record a direct reduction to the provision for credit losses.

Credit card receivables associated with alleged or potential fraudulent transactions are charged off through noninterest expense—general and administrative in the consolidated statements of operations and comprehensive income (loss).

Commercial and consumer banking loans are reported as delinquent when they become 30 or more days past due.

For all commercial and consumer banking loans, we stop accruing interest and reverse all accrued but unpaid interest after 90 days of delinquency.

For consumer banking loans, delinquent loans are charged off after 120 days of delinquency or on the date of confirmed loss.

For commercial loans, performance is monitored on an individual loan basis and delinquent loans are charged off when collectability of interest and principal on the loan is not reasonably assured.

Allowance for Credit Losses

Effective January 1, 2020, we adopted the provisions of Accounting Standards Update (“ASU”) 2016-13, Measurement of Credit Losses on Financial Instruments , which requires upfront recognition of lifetime expected credit losses using a current expected credit loss model.

As of December 31, 2021, the standard was applicable to (i) cash equivalents and restricted cash equivalents, (ii) accounts receivable from contracts with customers, inclusive of servicing related receivables, (iii) margin receivables, which were attributable to our activities at 8 Limited, (iv) certain loan repurchase reserves representing guarantees of credit exposure, (v) loans measured at amortized cost, including credit card loans, and (vi) investments in AFS debt securities.

We primarily evaluate expected credit losses under the current expected credit loss model for the following financial assets:

(i) cash equivalents and restricted cash equivalents, (ii) accounts receivable from contracts with customers, inclusive of servicing related receivables, (iii) loans measured at amortized cost, and (iv) investments in available-for-sale (“AFS”) debt securities.

Our approaches to measuring the allowance for credit losses on the applicable financial assets are as follows:

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Accounts receivable from contracts with customers :

Accounts receivable from contracts with customers as of the balance sheet dates are recorded at their original invoice amounts reduced by any allowance for credit losses.

In accordance with the standard, we pool our accounts receivable, all of which are short-term in nature and arise from contracts with customers, based on shared risk characteristics to assess their risk of loss, even when that risk is remote.

Accounts receivable from contracts with customers as of the balance sheet dates, all of which are short-term in nature, are recorded at their original invoice amounts reduced by any allowance for credit losses.

We assess the risk of loss for each individual customer, even when the risk is remote.

Certain of our historical accounts receivable balances did not have any write-offs.

We use the aging method and historical loss rates as a basis for estimating the percentage of current and delinquent accounts receivable balances that will result in credit losses.

We consider whether the conditions at the measurement date and reasonable and supportable forecasts about future conditions warrant an adjustment to our historical loss experience.

In applying such adjustments, we primarily evaluate changes in customer creditworthiness, current economic conditions, expectations of near-term economic trends and changes in customer payment terms and collection trends.

For the measurement dates presented herein, given our methods of collecting funds, and that we have not observed meaningful changes in our customers’ payment behavior, we determined that our historical loss rates remained most indicative of our lifetime expected losses.

We record the provision for credit losses on accounts receivable from

We consider whether the conditions at the measurement date and reasonable and supportable forecasts about future conditions, such as customer creditworthiness, current economic conditions, customer location, expectations of near-term economic trends and changes in customer payment terms and collection trends, warrant an adjustment to our historical loss experience.

Based on this analysis, we determined that our historical loss rates remained most indicative of our lifetime expected losses.

We record the provision for credit losses on accounts receivable from contracts with customers within noninterest expense—general and administrative in the consolidated statements of operations and comprehensive income (loss).

When we determine that a receivable is not collectible, we write off the uncollectible amount as a reduction to both the allowance and the gross asset balance.

Recoveries are recorded when received and credited to the provision for credit losses.

Any change in the assumptions used in analyzing a specific account receivable may result in an additional allowance for credit

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

contracts with customers within noninterest expense—general and administrative in the consolidated statements of operations and comprehensive income (loss).

When we determine that a receivable is not collectible, we write off the uncollectible amount as a reduction to both the allowance and the gross asset balance.

Recoveries are recorded when received and credited to the provision for credit losses.

Any change in the assumptions used in analyzing a specific account receivable may result in an additional allowance for credit losses being recognized in the period in which the change occurs.

losses being recognized in the period in which the change occurs.

See Note 5 for a rollforward of the allowance for credit losses related to our accounts receivable.

Margin receivables :

Our margin receivables, which are associated with margin lending services we offer to members through 8 Limited, are fully collateralized by the borrowers’ securities under collateral maintenance provisions, to which we regularly monitor adherence.

Therefore, using the practical expedient in ASC 326-20-35-6, Financial Instruments — Credit Losses , we did not record expected credit losses on this pool of margin receivables, as the fair value of the underlying collateral is expected to exceed the amortized cost of the receivables.

Loan repurchase reserves :

We issue financial guarantees related to certain non-agency loan transfers, which are subject to repurchase based on the occurrence of certain credit-related events within a specified amount of time following loan transfer, which does not exceed 90 days from origination.

We estimate the contingent guarantee liability based on our historical repurchase activity for similar types of loans and assess whether adjustments to our historical loss experience are required based on current conditions and forecasts of future conditions, as appropriate, as our exposure under the guarantee is short-term in nature.

See Note 16 for additional information on our guarantees.

Credit card loans :

Our estimates of the allowance for credit losses as of December 31, 2021 and 2020 were $ 7,037 and $ 219 , respectively.

Accordingly, our estimate of the allowance for credit losses as of December 31, 2020 was immaterial to the consolidated financial statements.

During the third quarter of 2021, we began to segment pools of credit card loans based on consumer credit score bands as measured using FICO scores obtained at the origination of the account (“origination FICO”) and also by delinquency status, which may be adjusted using other risk-differentiating attributes to model charge-off probabilities and the average life over which expected credit losses may occur for the credit card loans within each pool.

As our historical internal risk tiers were assigned primarily based on origination FICO, our pooling of our historical assets did not materially change, nor would there have been a material impact on our historical provision for credit losses if we had utilized our current credit quality indicators when setting our historical provision.

The pools estimate the likelihood of borrowers with similar origination FICO scores to pay credit obligations based on aggregate credit performance data.

Credit cards :

We segment pools of credit cards based on consumer credit score bands as measured using FICO scores, which are obtained at origination of the account and are refreshed monthly thereafter, and also by delinquency status, which may be adjusted using other risk-differentiating attributes to model charge-off probabilities and the average life over which expected credit losses may occur for the credit cards within each pool.

The pools estimate the likelihood of borrowers with similar FICO scores to pay credit obligations based on aggregate credit performance data.

When necessary, we apply separate credit loss assumptions to assets that have deteriorated in credit quality such that they no longer share similar risk characteristics with other assets in the same FICO score band.

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We reassess our credit card pools periodically to confirm that all loans within each pool continue to share similar risk characteristics.

We establish an allowance for the pooled credit card loans within each pool utilizing the risk model described above, which may then be adjusted for current conditions and reasonable and supportable forecasts of future conditions, including economic conditions.

We apply the probability-of-default and loss-given-default assumptions to the drawn balance of credit card loans within each pool to estimate the lifetime expected credit losses within each pool, which are then aggregated to determine the allowance for credit losses.

We establish an allowance within each pool of credit cards utilizing the risk model described above, which may then be adjusted for current conditions and reasonable and supportable forecasts of future conditions, including economic conditions.

We apply the probability-of-default and loss-given-default assumptions to the drawn balance of credit cards within each pool to estimate the lifetime expected credit losses within each pool, which are then aggregated to determine the allowance for credit losses.

We do not measure credit losses on the undrawn credit exposure, as such undrawn credit exposure is unconditionally cancellable by us.

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and inherent uncertainties in applying the methodology.

We record the provision for credit losses on credit card loans within noninterest expense—provision for credit losses in the consolidated statements of operations and comprehensive income (loss).

Credit card loans are reported as delinquent when they become 30 or more days past due.

Credit card loans are charged off after 180 days of delinquency or on the date of the confirmed loss, at which time we stop accruing interest and reverse all accrued but unpaid interest through interest income as of such date.

When a credit card loan is charged off, we record a reduction to the allowance and the credit card loan balance.

When recovery payments are received against charged off credit card loans, we record a direct reduction to the provision for credit losses and resume the accrual of interest.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

There were no credit card loans on nonaccrual status as of December 31, 2021 and 2020.

Credit card balances expensed due to alleged or potential fraudulent transactions, net of recoveries, during the year ended December 31, 2021 were $ 1,292 .

There were no such credit card loan charge offs during the year ended December 31, 2020.

Accrued interest receivables written off during the year ended December 31, 2021 were $ 133 , all of which were accrued during 2021.

We did no t have any accrued interest receivables written off during the year ended December 31, 2020.

See Note 8 for a rollforward of the allowance for credit losses related to our credit card loans.

We elected to exclude interest on credit card loans from the measurement of our allowance, as our policy allows for accrued interest to be reversed in a timely manner.

Further, we elected the practical expedient to exclude the accrued interest component of our credit card loans from the quantitative disclosures presented.

Credit Quality Indicators

The primary credit quality indicators that are important to understanding the overall credit performance of our credit card borrowers and their ability to repay are reflected by delinquency status and by credit performance expectations, as segmented by origination FICO bands as of December 31, 2021.

The Company monitors these credit quality indicators on an ongoing basis.

The following table presents the amortized cost basis of our credit card loan portfolio (excluding accrued interest and before the allowance for credit losses) by either current status or delinquency status as of the dates indicated:

Delinquent Loans

Current 30–59 Days 60–89 Days ≥ 90 Days (1)

Total Delinquent Loans Total Loans (2)

December 31, 2021

Credit card loans $ 115,356 1,893 1,683 2,658 6,234 $ 121,590

December 31, 2020

Credit card loans $ 3,864 74 2 — 76 $ 3,940

_____________________

(1) As of December 31, 2021, all of the credit card loans that were 90 days or more past due continued to accrue interest.

(2) Presented before allowance for credit losses of $ 7,037 and $ 219 as of December 31, 2021 and 2020, respectively, and excludes accrued interest of $ 1,359 and $ 2 , respectively.

The following table presents the amortized cost basis of our credit card loan portfolio (excluding accrued interest and before the allowance for credit losses) as of December 31, 2021 based on origination FICO.

Generally, higher origination FICO score bands reflect higher anticipated credit performance than lower origination FICO score bands.

Origination FICO December 31, 2021

≥ 800 $ 10,016

780 – 799 8,624

760 – 779 9,976

740 – 759 13,581

720 – 739 18,358

700 – 719 22,579

680 – 699 21,736

660 – 679 14,044

640 – 659 1,969

Total credit card loans $ 121,590

We record the provision for credit losses on credit cards within noninterest expense—provision for credit losses in the consolidated statements of operations and comprehensive income (loss).

We elected to exclude interest on credit cards from the measurement of our allowance, as our policy allows for accrued interest to be reversed in a timely manner.

Further, we elected the practical expedient to exclude the accrued interest component of our credit cards from the quantitative disclosures presented.

See Note 5 for a rollforward of the allowance for credit losses related to our credit cards.

Commercial and consumer banking loans :

We evaluate the credit quality of our commercial and consumer banking loan portfolio based on regulatory risk ratings.

Loans are categorized into risk ratings based on relevant information about the ability of borrowers to service their debt, such as current financial information, historical payment experience, collateral adequacy, credit documentation, and current economic trends, among other factors.

The allowance for credit losses is determined at an individual loan level and estimated based on weighted average remaining maturity and annualized loss rate according to the loan’s regulatory loan type and risk rating classification.

This analysis is performed on an ongoing basis as new information is obtained.

See Note 5 for a rollforward of the allowance for credit losses related to our commercial and consumer banking loans.

Investments in AFS debt securities :

An allowance for credit losses on our investments in AFS debt securities is required for any portion of impaired securities that is attributable to credit-related factors.

For certain securities that are

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

guaranteed by the U.S.

For certain securities that are guaranteed by the U.S.

Treasury or government agencies, or sovereign entities of high credit quality, we concluded that there is no risk of credit-related impairment due to the nature of the counterparties and history of no credit losses.

For other investments in AFS debt securities, factors considered in evaluating credit losses include (i) adverse conditions related to the macroeconomic environment or the industry, geographic area or financial condition of the issuer, (ii) other credit indicators of the security, such as external credit ratings, and (iii) payment structure of the security.

For other investments in AFS debt securities, factors considered in evaluating credit losses include:

(i) adverse conditions related to the macroeconomic environment or the industry, geographic area or financial condition of the issuer, (ii) other credit indicators of the security, such as external credit ratings, and (iii) payment structure of the security.

As of December 31, 2022, we concluded that the credit-related impairment was immaterial.

Credit-related impairment is recognized as an allowance for credit losses in the consolidated balance sheets with a corresponding adjustment to noninterest expense—provision for credit losses in the consolidated statements of operations and comprehensive income (loss).

Credit-related impairment, if applicable, is recognized as an allowance for credit losses in the consolidated balance sheets with a corresponding adjustment to noninterest expense—provision for credit losses in the consolidated statements of operations and comprehensive income (loss).

Such credit losses are limited to the amount of the total impairment.

We did not recognize an allowance for credit losses on impaired investments in AFS debt securities as of December 31, 2022.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

Servicing Rights

Each time we enter into a servicing agreement, either in connection with transfers of our financial assets or in connection with a referral fulfillment arrangement we entered into during 2021 in which we are a sub-servicer for financial assets that we do not legally own, we determine whether we should record a servicing asset, servicing liability, or neither a servicing asset nor liability.

Each time we enter into a servicing agreement, either in connection with transfers of our financial assets or in connection with a referral fulfillment arrangement in which we are a sub-servicer for financial assets that we do not legally own, we determine whether we should record a servicing asset or servicing liability.

We elected the fair value option to measure our servicing rights subsequent to initial recognition.

We measure the initial and subsequent fair value of our servicing rights using a discounted cash flow methodology, which includes our contractual servicing fee, ancillary income, prepayment rate assumptions, default rate assumptions, a discount rate commensurate with the risk of the servicing asset or liability being valued, and an assumed market cost of servicing, which is based on active quotes from third-party servicers.

We measure the initial and subsequent fair value of our servicing rights using a discounted cash flow methodology, while also considering market data as it becomes available.

The significant assumptions used in the valuation model include our contractual servicing fee, ancillary income, prepayment rate assumptions, default rate assumptions, a discount rate commensurate with the risk of the servicing asset or liability being valued, and an assumed market cost of servicing, which is based on active quotes from third-party servicers.

For servicing rights retained in connection with loan transfers that do not meet the requirements for sale accounting treatment, there is no recognition of a servicing asset or liability.

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We elected the fair value option to measure our servicing rights to better align with the valuation of our transferred loans, which also tend to share a similar risk profile to the personal loan servicing we assume from third parties when we are not the loan originator.

The loans are also impacted by similar factors, such as conditional prepayment rates.

The loans are also impacted by similar factors, such as conditional prepayment rates and default rates.

We consider the risk of the assets and the observability of inputs in determining the classes of servicing rights.

We have three classes of servicing assets:

personal loans, home loans and student loans.

There is prepayment and delinquency risk inherent in our servicing rights, but we currently do not use any instruments to mitigate such risks.

personal loans, student loans and home loans.

See Note 15 for the key inputs used in the fair value measurements of our classes of servicing rights.

Investments in Debt Securities

The accounting and measurement framework for our investments in debt securities is determined based on the security classification.

We do not hold investments in debt securities for trading purposes, nor do we have investments in debt securities that we have the intent and ability to hold to maturity.

Therefore, we classify our investments in debt securities as available-for-sale.

During the first quarter of 2022, we acquired additional investments in AFS debt securities with the Bank Merger.

See Note 15 for additional information on our fair value estimates for investments in AFS debt securities.

For purposes of determining gross realized gains and losses on AFS debt securities, the cost of securities sold is based on specific identification.

We elected to present accrued interest for AFS debt securities within investment securities in the consolidated balance sheets.

However, premiums on certain callable debt securities are amortized to the earliest call date.

An investment in AFS debt security is considered impaired if its fair value is less than its amortized cost.

If neither of the above conditions exists, we evaluate whether the impairment loss is attributable

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Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

to credit-related or non-credit-related factors.

Any impairment that is not credit-related is recognized within other comprehensive income (loss) , net of taxes.

See the section “Allowance for Credit Losses” in this Note 1 for the factors we consider in identifying credit-related impairment and the treatment of credit losses.

See Note 6 for additional information on our investments in AFS debt securities.

Securitization Investments

In Company-sponsored securitization transactions that meet the applicable criteria to be accounted for as a sale, we retain certain residual interests and asset-backed bonds.

We measure these investments at fair value on a recurring basis.

We measure these investments at fair value on a recurring basis and report them within investment securities in the consolidated balance sheets.

Gains and losses related to our securitization investments are reported within noninterest income—securitizations in the consolidated statements of operations and comprehensive income (loss).

We determine the fair value of our securitization investments using a discounted cash flow methodology, while also considering market data as it becomes available.

We classify the residual investments as Level 3 due to the reliance on significant unobservable valuation inputs.

We classify asset-backed bonds as Level 2 due to the use of quoted prices for similar assets in markets that are not active, as well as certain factors specific to us.

Our residual investments accrete interest income over the expected life using the effective yield method pursuant to ASC 325-40, Investments — Other, which reflects a portion of the overall fair value adjustment recorded each period on our residual investments.

Our residual investments accrete interest income over the expected life using the effective yield method , which reflects a portion of the overall fair value adjustment recorded each period on our residual investments.

On a quarterly basis, we reevaluate the cash flow estimates over the life of the residual investments to determine if a change to the accretable yield is required on a prospective basis.

Additionally, we record interest income associated with asset-backed bonds over the term of the underlying bond using the effective interest method on unpaid bond

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Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

Additionally, we record interest income associated with asset-backed bonds over the term of the underlying bond using the effective interest method on unpaid bond amounts.

Interest income on residual investments and asset-backed bonds is presented within interest income—securitizations in the consolidated statements of operations and comprehensive income (loss).

See Note 15 for the key inputs used in the fair value measurements of our residual investments and asset-backed bonds.

Equity Method Investments

In August 2021, we finalized the purchase of a 5 % interest in Lower Holding Company (“Lower”) for $ 20,000 , upon obtaining certain regulatory approvals.

This equity method investment expanded our home loan origination fulfillment capabilities.

Upon the closing of the transaction, we were granted a seat on Lower’s board of directors.

Based on accounting guidance in ASC 323-10, Investments — Equity Method and Joint Ventures , we concluded that we had significant influence over the investee because of our representation on its board of directors.

However, we did not control the investee and, therefore, accounted for the investment under the equity method of accounting.

The investment was not deemed to be significant under either Regulation S-X, Rule 3-09 or Rule 4-08(g).

We recorded our portion of Lower equity method earnings within noninterest income—other in the consolidated statements of operations and comprehensive income (loss) and as an increase to the carrying value of our equity method investment in the consolidated balance sheets.

We recognized equity method losses of $ 261 during the year ended December 31, 2021, which included basis difference amortization.

The investment in Lower resulted in a basis difference of $ 1,769 that was attributable to the excess of the fair value of certain assets measured at amortized cost relative to book value, as well as definite-lived intangible assets.

The basis difference is being amortized into income as an offset to equity method earnings over the weighted average life of the assets measured at amortized cost by Lower and the useful life of the separately-identified intangible assets.

The amortization range is 1.3 to 5.0 years, and the weighted average amortization period is 3.3 years as of December 31, 2021.

Our policy for amortizing separately-identified Lower assets was consistent with our policy for amortizing our assets of a similar type, and our basis for amortizing assets held by Lower at amortized cost was consistent with our experience with similar assets.

We did no t receive any distributions during the year ended December 31, 2021.

We did not recognize any impairment related to our Lower investment during the year ended December 31, 2021.

On January 25, 2022, we relinquished our seat on Lower’s board of directors.

As such, we no longer have significant influence over the investee and we will cease recognizing Lower equity investment income subsequent to that date.

In December 2018, we purchased a 16.7 % interest in Apex Clearing Holdings, LLC (“Apex”) for $ 100,000 , which represented our only significant equity method investment at the time.

We recorded our portion of Apex equity method earnings within noninterest income—other in the consolidated statements of operations and comprehensive income (loss) and as an increase to the carrying value of our equity method investment in the consolidated balance sheets.

We recognized equity method earnings on our investment in Apex of $ 4,442 and $ 795 during the years ended December 31, 2020 and 2019, respectively, which included basis difference amortization.

During the year ended December 31, 2020, we invested an additional $ 145 in Apex, which increased our equity method investment ownership to 16.8 % as of that date.

The seller of the Apex interest had call rights over our initial equity interest in Apex (“Seller Call Option”) from April 14, 2020 to December 14, 2023, which rights were exercised in January 2021.

Therefore, we ceased recognizing Apex equity investment income subsequent to the call date.

As of December 31, 2020, we measured the carrying value of the Apex equity method investment equal to the call payment that we received in January 2021 of $ 107,534 .

There was no equity method investment balance as of December 31, 2021.

We did no t receive any distributions during the years ended December 31, 2020 and 2019.

We also had an equity method investment balance related to a residential mortgage origination joint venture, which was discontinued in the third quarter of 2020, at which point we received a closing distribution of $ 974 related to the investment and we recognized an immaterial loss on the dissolution date.

For the years ended December 31, 2020 and 2019, the earnings related to this joint venture were immaterial.

Investments in Equity Securities

Our investments in equity securities consist of investments for which fair values are not readily determinable, which we elect to measure using the alternative method of accounting, under which they are measured at cost less any impairment and adjusted for changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuers.

Our investments in equity securities are presented within other assets in the consolidated balance sheets.

Adjustments to the carrying values of our investments in equity securities, such as impairments and unrealized gains, are recognized within noninterest income—other in the consolidated statements of operations and comprehensive income (loss).

Property, Equipment and Software

All property, equipment and software are initially recorded at cost;

repairs and maintenance are expensed as incurred.

Computer hardware, furniture and fixtures, software, and finance lease right-of-use (“ROU”) assets are depreciated or amortized on a straight-line basis over the estimated useful life of each class of depreciable or amortizable assets (ranging from

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Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

2.5 to 7.0 years).

All property, equipment and software are initially recorded at cost, while repairs and maintenance costs are expensed as incurred.

Computer hardware, furniture and fixtures, software, buildings and finance lease right-of-use (“ROU”) assets are depreciated or amortized on a straight-line basis over the estimated useful life of each class of depreciable or amortizable assets (ranging from one to 30 years).

Leasehold improvements are amortized over the shorter of the respective lease term or the estimated lives of the leasehold improvements.

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Internally-developed software is capitalized when preliminary project efforts are successfully completed, and it is probable that both the project will be completed and the software will be used as intended.

Capitalized costs consist of salaries and compensation costs for employees, fees paid to third-party consultants who are directly involved in development efforts and costs incurred for upgrades and functionality enhancements.

Capitalized costs consist of salaries and compensation costs (inclusive of share-based compensation) for employees, fees paid to third-party consultants who are directly involved in development efforts and costs incurred for upgrades and functionality enhancements, and are amortized over a useful life of 2.5 years.

Other costs are expensed as incurred.

The table below presents our major classes of depreciable and amortizable assets by function as of the dates indicated:

Balance Accumulated Depreciation/Amortization Carrying

December 31, 2021

Computer hardware $ 16,864 $ ( 8,583 ) $ 8,281

Leasehold improvements 39,726 ( 12,233 ) 27,493

Furniture and fixtures (1)

18,326 ( 7,748 ) 10,578

75,632 ( 22,996 ) 52,636

Finance lease ROU assets (3)

15,100 ( 2,876 ) 12,224

Construction in progress (4)

Total $ 166,309 $ ( 54,436 ) $ 111,873

December 31, 2020

Computer hardware $ 13,494 $ ( 6,037 ) $ 7,457

Leasehold improvements 36,725 ( 7,920 ) 28,805

Furniture and fixtures (1)

12,361 ( 5,251 ) 7,110

42,323 ( 18,587 ) 23,736

Finance lease ROU assets (3)

15,100 ( 719 ) 14,381

Total $ 120,003 $ ( 38,514 ) $ 81,489

_____________________

(1) Furniture and fixtures primarily include office equipment as well as other furniture and fixtures associated with SoFi Stadium.

(2) Software primarily includes internally-developed software related to significant developments and enhancements for our products.

During the year ended December 31, 2021, we capitalized $ 7,776 of share-based compensation related to internally-developed software, and we recognized associated amortization expense of $ 792 .

We did no t capitalize any share-based compensation during the years ended December 31, 2020 and 2019.

(3) Finance lease ROU assets include our rights to certain physical signage within SoFi Stadium.

See Note 16 for additional information on our leases.

(4) Construction in progress as of December 31, 2021 relates to furniture and fixtures and computer hardware.

For the years ended December 31, 2021, 2020 and 2019, total depreciation and amortization expense associated with property, equipment and software, inclusive of the amortization of capitalized share-based compensation, was $ 31,061 , $ 20,097 and $ 12,947 , respectively.

We recognized property, equipment and software abandonment of $ 2,137 during the year ended December 31, 2019.

There were no abandonments during the years ended December 31, 2021 and 2020.

There were no impairments during any of the years presented.

We had losses on computer hardware disposals of $ 164 during the year ended December 31, 2021.

See Note 9 for additional information on our property, equipment and software.

Goodwill and Intangible Assets

Goodwill represents the fair value of an acquired business in excess of the fair value of the identified net assets acquired.

Goodwill is tested for impairment annually or whenever indicators of impairment exist.

We apply the provisions of ASU 2017-04, Simplifying the Test for Goodwill Impairment , to calculate goodwill impairment (if any) on at least an annual basis, which provides for an unconditional option to bypass the qualitative assessment.

Goodwill is tested for impairment at the reporting unit level annually or whenever indicators of impairment exist.

Impairment of goodwill is the condition that exists when the carrying amount of a reporting unit that includes goodwill exceeds

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Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

Impairment of goodwill is the condition that exists when the carrying amount of a reporting unit that includes goodwill exceeds its fair value.

its fair value.

We may assess goodwill for impairment initially using a qualitative approach, referred to as “step zero”, to determine whether conditions exist to indicate that it is more likely than not that the fair value of a reporting unit is less than its carrying amount.

If management concludes, based on its assessment of relevant events, facts and circumstances, that it is more likely than not that a reporting unit’s carrying value is greater than its fair value, then a quantitative analysis will be performed to determine if there is any impairment.

We may alternatively elect to initially perform a quantitative assessment and bypass the qualitative assessment.

A goodwill impairment loss is recognized for the amount that the carrying amount of a reporting unit, including goodwill, exceeds its fair value, limited to the total amount of goodwill allocated to that reporting unit.

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Our annual impairment testing date is October 1.

Intangible assets as of December 31, 2021 included developed technology;

customer-related contracts;

trade names, trademarks and domain names;

core banking infrastructure;

and broker-dealer license and trading rights.

Definite-lived intangible assets are straight-line amortized over their useful lives and reviewed for impairment annually and whenever events or circumstances indicate that the carrying amount of such assets may not be recoverable.

We do not have any indefinite-lived intangible assets.

See Note 2 and Note 3 for further discussion of goodwill and intangible assets, including those recognized in connection with recent business acquisitions.

In accordance with ASC 842, Leases , which we began applying as of January 1, 2019, we determine if an arrangement is or contains a lease at inception of the contract.

Definite-lived intangible assets are amortized on a straight-line basis over their useful lives and reviewed for impairment annually and whenever events or circumstances indicate that the carrying amount of such assets may not be recoverable.

Intangible assets include capitalized costs incurred in the development and enhancement of our software products to be sold, leased or marketed.

These costs, consisting primarily of salaries and compensation costs (inclusive of share-based compensation) for employees, are expensed as incurred until technological feasibility has been established, after which the costs are capitalized until the product is available for general release to customers.

See Note 2 and Note 8 for further discussion of goodwill and intangible assets, including those recognized in connection with recent business combinations.

We determine if an arrangement is or contains a lease at inception of the contract.

A contract is or contains a lease if the contract conveys the right to control the use of identified property or equipment for a period of time in exchange for consideration.

For our current office and non-office classes of operating leases, we elected the practical expedient to choose not to separate non-lease components from lease components and instead to account for each separate lease component and the non-lease components associated with that lease component as a single lease component.

For our current office and non-office classes of operating leases, we elected the practical expedient to not separate non-lease components from lease components and to, instead, account for each separate lease component and the non-lease components associated with that lease component as a single lease component.

For our current classes of finance leases, we did not elect to apply this practical expedient and, instead, separately identify and measure the non-lease components of the contracts.

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Operating and finance lease ROU assets represent our right to use an underlying asset for the lease term and operating and finance lease liabilities represent our obligation to make lease payments arising from the lease.

ROU assets and lease liabilities are recognized at commencement date based on the present value of lease payments over the lease term.

As our leases do not provide an implicit borrowing rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.

ROU assets and lease liabilities are recognized at the commencement date based on the present value of lease payments over the lease term.

As our leases do not provide an implicit borrowing rate, we use our incremental borrowing rate based on the information available at commencement date or modification date, as appropriate, in determining the present value of lease payments.

The operating lease ROU assets are increased by any prepaid lease payments and are reduced by any unamortized lease incentives.

Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option.

Base rent is subject to rent escalations on each annual anniversary from the lease commencement dates.

Base rent is typically subject to rent escalations on each annual anniversary from the lease commencement dates.

Lease expense for lease payments, including any step rent provisions specified in the lease agreements, is recognized on a straight-line basis over the lease term and is allocated among the components of noninterest expense in the consolidated statements of operations and comprehensive income (loss).

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If both conditions are met, we account for the agreement as two separate contracts:

(i) the original, unmodified contract and (ii) a separate contract for the additional ROU asset.

If both conditions are not met, the modification is not evaluated as a separate contract.

Instead, based on the nature of the modification, we (i) reassess the lease classification on the modification date under the modified terms, and (ii) use the modified lease payments and discount rate to remeasure the lease liability and recognize any difference between the new lease liability and the old lease liability as an adjustment to the ROU asset.

(i) the original,

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Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

unmodified contract and (ii) a separate contract for the additional ROU asset.

If both conditions are not met, the modification is not evaluated as a separate contract.

Instead, based on the nature of the modification, we:

(i) reassess the lease classification on the modification date under the modified terms, and (ii) use the modified lease payments and discount rate to remeasure the lease liability and recognize any difference between the new lease liability and the old lease liability as an adjustment to the ROU asset.

See Note 9 for additional information on our leases.

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We enter into derivative contracts to manage future loan sale execution risk.

We did not elect hedge accounting, as management’s hedging intentions are to economically hedge the risk of unfavorable changes in the fair value of our student loans, personal loans and home loans.

Our derivative instruments used to manage future loan sale execution risk as of the balance sheet dates included interest rate futures, interest rate swaps, interest rate caps, and home loan pipeline hedges.

We also had interest rate lock commitments (“IRLC”) and interest rate caps that were not related to future loan sale execution risk.

The interest rate futures and home loan pipeline hedges are measured at fair value and categorized as Level 1 fair value assets and liabilities, as all contracts held are traded in active markets for identical assets or liabilities and quoted prices are accessible by us at the measurement date.

The interest rate swaps and interest rate caps are measured at fair value and categorized as Level 2 fair value assets and liabilities, as all contracts held are traded in active markets for similar assets or liabilities and other observable inputs are available at the measurement date.

IRLCs are categorized as Level 3 fair value assets and liabilities, as the fair value is highly dependent on an assumed loan funding probability.

In the past, we have also entered into derivative contracts to hedge the market risk associated with some of our non-securitization investments.

We did not elect hedge accounting.

In addition, in conjunction with a loan sale agreement we entered into during 2018, we are entitled to receive payments from the buyer of the loans underlying the agreement if the internal rate of return (as defined in the loan sale agreement) on such loans exceeds a specified hurdle, subject to a dollar cap.

This provision is referred to as the “purchase price earn-out”.

As the purchaser maintains control of the transferred assets and retains the risk of loss, and the assets remain legally isolated from us, the transfer qualified for true sale accounting.

We determined that the purchase price earn-out is a derivative asset.

Therefore, the purchase price earn-out is measured at fair value on a recurring basis and is categorized as a Level 3 fair value asset, as the fair value is highly dependent on underlying loan portfolio performance.

Historically, the purchase price earn-out value was immaterial.

We did not elect hedge accounting, as management’s hedging intentions are to economically hedge the risk of unfavorable changes in the fair values of our personal loans, student loans and home loans.

Our derivative instruments used to manage future loan sale execution risk include interest rate swaps, interest rate caps and home loan pipeline hedges.

We also have interest rate lock commitments (“IRLC”), interest rate swaps and interest rate caps that were not related to future loan sale execution risk.

Changes in derivative instrument fair values are recognized in earnings as they occur.

Depending on the measurement date position, derivative financial instruments are presented within other assets or accounts payable, accruals and other liabilities in the consolidated balance sheets.

Our derivative instruments are reported within net cash provided by (used in) operating activities in the consolidated statements of cash flows.

The following table presents the gains (losses) recognized on our derivative instruments during the years indicated:

Year Ended December 31,

2021 2020 2019

Derivative contracts to manage future loan sale execution risk (1)(2)

$ 49,090 $ ( 54,829 ) $ ( 24,803 )

( 11,861 ) 14,530 916

Interest rate caps (1)

Purchase price earn-out (1)

Special payment (3)

( 21,181 ) — —

Third party warrants (4)

Derivative contracts to manage market risk associated with non-securitization investments (5)

— 996 ( 1,151 )

$ 25,740 $ ( 39,303 ) $ ( 25,038 )

_____________________

(1) Recorded within noninterest income—loan origination and sales in the consolidated statements of operations and comprehensive income (loss).

(2) The loss recognized during the year ended December 31, 2020 was inclusive of a $ 22,269 gain on credit default swaps that were opened and settled during the year.

(3) In conjunction with the Business Combination, the Amended Series 1 Agreement amended the original special payment provision to provide for a one-time special payment to Series 1 preferred stockholders, which was paid from the proceeds of the Business Combination and settled contemporaneously with the Business Combination.

The special payment was recognized within noninterest expense—general and administrativ e in the consolidated statements of operations and comprehensive income (loss), as this feature was accounted for as an embedded derivative that was not clearly and closely

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Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

related to the host contract, and will have no subsequent impact on our consolidated financial results.

The Series 1 Redeemable Preferred Stock has no stated maturity.

(4) Includes $ 273 recorded within noninterest income—other, $ 132 recorded within noninterest expense—cost of operations and $ 168 recorded within noninterest expense—general and administrative in the consolidated statements of operations and comprehensive income (loss), the latter of which represents the amortization of a deferred liability recognized at the initial fair value of the third party warrants acquired of $ 964 , as we are also a customer of the third party.

(5) Recorded within noninterest income—other in the consolidated statements of operations and comprehensive income (loss).

We did not have any such derivative contracts to hedge our non-securitization investments during the year ended December 31, 2021.

Our derivative instruments are reported within cash flows from operating activities in the consolidated statements of cash flows.

Certain derivative instruments are subject to enforceable master netting arrangements.

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Additionally, since our cash collateral balances do not approximate the fair value of the derivative position, we do not offset our right to reclaim cash collateral or obligation to return cash collateral against recognized derivative assets or liabilities.

The following table presents information about derivative instruments subject to enforceable master netting arrangements as of the dates indicated:

December 31, 2021 December 31, 2020

Gross Derivative Assets Gross Derivative Liabilities Gross Derivative Assets Gross Derivative Liabilities

Interest rate swaps $ 5,444 $ — $ — $ ( 947 )

Interest rate caps — ( 668 ) — —

Home loan pipeline hedges 117 ( 313 ) — ( 1,872 )

Interest rate futures — — — ( 136 )

Total, gross $ 5,561 $ ( 981 ) $ — $ ( 2,955 )

derivative netting ( 117 ) 117 — —

Total, net (1)

$ 5,444 $ ( 864 ) $ — $ ( 2,955 )

_____________________

(1) As of December 31, 2021 and 2020, we had a cash collateral requirement of $ 299 and $ 1,746 , respectively, related to these instruments.

The following table presents the notional amount of derivative contracts outstanding as of the dates indicated:

Derivative contracts to manage future loan sale execution risk:

Interest rate swaps $ 4,210,000 $ 1,475,000

Home loan pipeline hedges 421,000 371,000

Interest rate caps 405,000 —

Interest rate futures — 3,400,000

357,529 630,277

Interest rate caps (2)

Total $ 5,798,529 $ 5,876,277

_____________________

(1) Amounts correspond with home loan funding commitments subject to IRLC agreements.

(2) We sold an interest rate cap that was subject to master netting to offset an interest rate cap purchase made in conjunction with a contract to manage future loan sale execution risk.

While the notional amounts of derivative instruments give an indication of the volume of our derivative activity, they do not necessarily represent amounts exchanged by parties and are not a direct measure of our financial exposure.

See Note 9 for additional information on our derivative assets and liabilities.

See Note 14 and Note 15 for additional information on our derivative assets and liabilities.

Residual Interests Classified as Debt

For residual interests related to consolidated securitizations, the residual interests held by third parties are presented as residual interests classified as debt in the consolidated balance sheets.

We measure residual interests classified as debt at fair

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Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

value on a recurring basis.

Within consolidated securitizations, the residual interests held by third parties are presented as residual interests classified as debt in the consolidated balance sheets.

We measure residual interests classified as debt at fair value on a recurring basis.

We record subsequent measurement changes in fair value in the period in which the change occurs within noninterest income—securitizations in the consolidated statements of operations and comprehensive income (loss).

We determine the fair value of residual interests classified as debt using a discounted cash flow methodology, while also considering market data as it becomes available.

We classify the residual interests classified as debt as Level 3 due to the reliance on significant unobservable valuation inputs.

We recognize interest expense related to residual interests classified as debt over the expected life using the effective yield method, which reflects a portion of the overall fair value adjustment recorded each period on our residual interests classified as debt.

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See Note 15 for the key inputs used in the fair value measurements of residual interests classified as debt.

Fractional Shares

Through 8 Limited, which is a Hong Kong-based subsidiary, we have a “stock bits” feature that allows members with an 8 Limited investment account to purchase fractional shares in various companies.

8 Limited maintains control and risk over the stock inventory and, as such, must recognize on its balance sheet both the fraction of a share retained by the company and the fraction of a share owned by the member, with the latter also recorded as a payable to the member.

The inventory is recorded at its fair value based on the closing price of the associated stock.

As of December 31, 2021, the aggregate value of fractional shares owned by SoFi Hong Kong members was determined to be immaterial.

In our “stock bits” offering through our domestic SoFi Invest accounts, SoFi engages Apex as the clearing broker and, as such, does not retain control and risk over the stock inventory associated with fractional shares.

Therefore, SoFi does not recognize the fractional shares owned by domestic SoFi Invest members on its consolidated balance sheets.

Safeguarding Asset and Liability

Through our SoFi Invest product (via our wholly-owned subsidiary, SoFi Digital Assets, LLC, a licensed money transmitter), our members can invest in digital assets.

We engage third parties to provide custodial services for our digital assets offering, which includes holding the cryptographic key information and working to protect the digital assets from loss or theft.

The third-party custodians hold digital assets as custodial assets in an account in SoFi’s name for the benefit of our members.

We maintain the internal recordkeeping of our members’ digital assets, including the amount and type of digital assets owned by each of our members in the custodial accounts.

We currently utilize two third-party custodians.

Therefore, we have concentration risk in the event the custodians are not able to perform in accordance with our agreements.

In accordance with Staff Accounting Bulletin No.

121 (“SAB 121”), which is further discussed under “ Recently Adopted Accounting Standards ” in this Note 1, we recognize a digital assets safeguarding liability within accounts payable,

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

accruals and other liabilities in the consolidated balance sheets reflecting our obligation to safeguard the digital assets held by third-party custodians for the benefit of our members.

We also recognize a corresponding safeguarding asset within other assets in the consolidated balance sheets.

The safeguarding liability and corresponding safeguarding asset are measured and recorded at the fair value of the digital assets held by the custodians at each reporting date.

Subsequent changes to the fair value measure are reflected as equal and offsetting adjustments to the carrying values of the safeguarding liability and corresponding safeguarding asset.

We evaluate any potential loss events, such as theft, loss or destruction of the cryptographic keys, that may affect the measurement of the safeguarding asset, which would be reflected in our results of operations in the period the loss occurs.

Measurement changes do not impact the consolidated statements of operations and comprehensive income (loss) unless such a loss event is identified.

As of December 31, 2022, we did not identify any loss events.

See Note 15 for additional information on the fair value measurement of the safeguarding liability and corresponding safeguarding asset.

Borrowings and Financing Costs

3 unchanged sentences

Any difference between the stated principal amount of debt and the amount of cash proceeds received, net of debt issuance costs, is presented as a discount or premium.

The capitalized debt issuance costs and the original issue discount/premium are amortized into interest expense over the expected life of the related financing agreements using the straight-line method for revolving facilities and the effective interest method for securitization debt and our senior convertible notes, which are further discussed below.

Remaining unamortized fees are expensed immediately upon early extinguishment of the debt.

In a debt modification for revolving debt, the initial issuance costs and any additional fees incurred as a result of the modification are deferred over the term of the new agreement, if the borrowing capacity of the revolving facility is increased.

In the case that a modification results in a decrease in our borrowing capacity, any fees paid to the creditor and any third-party costs incurred are associated with the new arrangement and are, therefore, deferred and amortized over the term of the new arrangement.

In the case that a modification results in a decrease in our borrowing capacity, any fees paid to the creditor and any third-party costs incurred are considered to be associated with the new arrangement and are, therefore, deferred and amortized over the term of the new arrangement.

Unamortized deferred costs relating to the old arrangement at the time of the modification are expensed immediately in proportion to the decrease in borrowing capacity of the old arrangement.

Any remaining unamortized deferred costs relating to the old arrangement are deferred and amortized over the term of the new arrangement.

The total accrued interest payable of $ 1,306 and $ 19,817 as of December 31, 2021 and 2020, respectively, was primarily related to interest associated with our borrowings and was presented within accounts payable, accruals and other liabilities in the consolidated balance sheets.

We elected the fair value option to measure certain securitization debt, with the intent to mitigate the accounting divergence between debt liabilities measured at historical cost and the corresponding loans securing these financings, which are risk-managed on a fair value basis.

For securitization debt carried at fair value on a recurring basis, we record the initial fair value measurement and subsequent measurement changes in fair value in the period in which the changes occur within noninterest income—securitizations in the consolidated statements of operations and comprehensive income (loss).

We determined the fair value of the applicable securitization debt using a discounted cash flow methodology, while also considering market data as it becomes available.

The key inputs to the calculation include the underlying contractual coupons, terms, discount rate and expectations for defaults and prepayments.

Convertible Senior Notes

2 unchanged sentences

We will settle conversions by paying or delivering, at our election, cash, shares of our common stock or a combination of cash and shares of our common stock, based on the applicable conversion rate(s).

The Convertible Notes will also be redeemable, in whole or in part, at our option at any time, and from time to time, on or after October 15, 2024 through on or before the 30th scheduled trading day immediately before the maturity date, at a cash redemption price equal to the principal amount of the Convertible Notes to be redeemed, plus accrued interest, if any, thereon to, but excluding, the redemption date, but only if certain liquidity conditions described in the indenture are satisfied and certain conditions are met with respect to the last reported sale price per share of our common stock prior to conversion.

See Note 12 for more detailed disclosure of the term and features of the Convertible Notes.

We elected to evaluate each embedded feature of the arrangement individually.

We concluded that each of the conversion rights, optional redemption rights, fundamental change make-whole provision and repurchase rights did not require bifurcation as derivative instruments, which we reevaluate each reporting period.

The additional interest and special interest that accrue on the notes in the event of our failure to comply with certain registration or reporting requirements are required to be bifurcated from the host contract, as the reporting requirement triggering event is not clearly and closely related to the host

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

principal amount of the Convertible Notes to be redeemed, plus accrued interest, if any, thereon to, but excluding, the redemption date, but only if certain liquidity conditions described in the indenture are satisfied and certain conditions are met with respect to the last reported sale price per share of our common stock prior to conversion.

See Note 10 for more detailed disclosure of these term and features of the Convertible Notes.

We elected to evaluate each embedded feature of the arrangement individually.

convertible debt contract, and therefore we measure the contingent interest feature at fair value each reporting period.

The value was determined to be immaterial;

1 unchanged sentence

Accordingly, we allocated all debt issuance costs to the debt instrument on the basis of materiality.

In connection with the pricing of the Convertible Notes, we entered into privately negotiated capped call transactions with certain financial institutions, which are further discussed below.

In connection with the pricing of the Convertible Notes, we entered into privately negotiated capped call transactions with certain financial institutions, as defined and further discussed below.

Redeemable Preferred Stock

Immediately prior to the Business Combination, all shares of the Company’s outstanding shares of redeemable preferred stock, other than the Series 1 preferred stock, converted into shares of SoFi Technologies common stock.

Series 1 preferred stock is classified in temporary equity, as it is not fully controlled by SoFi.

Series 1 Redeemable Preferred Stock (as defined in Note 13) is classified in temporary equity, as it is not fully controlled by SoFi.

See Note 13 for additional information.

Foreign Currency Translation Adjustments

We revalue assets, liabilities, income and expense denominated in non-United States currencies into United States dollars using applicable exchange rates.

For foreign subsidiaries in which the functional currency is the subsidiary’s local currency, gains and losses relating to foreign currency translation adjustments are included in accumulated other comprehensive loss in our consolidated balance sheets.

For foreign subsidiaries in which the functional currency is the United States Dollar, gains and losses relating to foreign currency transaction adjustments are included within earnings in the consolidated statements of operations and comprehensive income (loss).

Accumulated Deficit

We purchase SoFi common stock from time to time and constructively retire the common stock.

We record purchases of common stock as a reduction to accumulated deficit in the consolidated balance sheets.

Due to the highly inflationary economic environment in Argentina, we use the United States Dollar as the functional currency of our Argentinian operations.

Our activities in Argentina are related to our Technology Platform segment and commenced in the first quarter of 2022 with the Technisys Merger.

Capped Call Transactions

4 unchanged sentences

Holders of the Convertible notes do not have any rights with respect to the Capped Call Transactions.

As the Capped Call Transactions are legally detachable and separately exercisable from the Convertible Notes, they were evaluated as freestanding instruments under ASC 480, Distinguishing Liabilities from Equity (“ASC 480”).

We concluded that the Capped Call Transactions meet the scope exceptions for derivative instruments under ASC 815.

As such, the Capped Call Transactions meet the criteria for classification in equity and are included as a reduction to additional paid-in capital .

As the Capped Call Transactions are legally detachable and separately exercisable from the Convertible Notes, they were evaluated as freestanding instruments.

We concluded that the Capped Call Transactions meet the scope exceptions for derivative instruments, and as such, the Capped Call Transactions meet the criteria for classification in equity and are included as a reduction to additional paid-in capital .

See Note 13 for additional information on the Capped Call Transactions.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

Interest Income

3 unchanged sentences

Loans are returned to accrual status if the loans are brought to nondelinquent status or have performed in accordance with the contractual terms for a reasonable period of time and, in management’s judgment, will continue to make scheduled periodic principal and interest payments.

We also have interest income associated with our investments in AFS debt securities.

See “Investments in Debt Securities” in this Note 1 for additional information.

During the years ended December 31, 2021, 2020 and 2019, related party interest income primarily arose from a note receivable we issued to a stockholder in 2019 that was repaid during 2020 and lending activities with Apex, our former equity method investee, which were settled in February 2021.

See Note 15 for additional information.

Other interest income is primarily earned on our bank balances and on member deposits with our member bank holding companies that enable our SoFi Money product.

Other interest income is primarily earned on our bank balances.

Loan Origination and Sales Activities

We measure our student loans, home loans and personal loans at fair value and, therefore, all direct fees and costs related to the origination process are recognized in earnings as earned or incurred.

Direct fees, which primarily relate to home loan originations, and direct loan origination costs are recorded within noninterest income—loan origination and sales and noninterest expense—cost of operations , respectively, in the consolidated statements of operations and comprehensive income (loss).

As part of our loan sale agreements, we may retain the rights to service sold loans.

We calculate a gain or loss on the sale based on the sum of the proceeds from the sale and any servicing asset recognized, less the carrying value of the loans sold.

We calculate a gain or loss on the sale based on the sum of the proceeds from the sale and any servicing asset or liability recognized, less the carrying value of the loans sold.

Our gain or loss calculation is also inclusive of repurchase liabilities recognized at the time of sale.

For our credit card loans, direct loan origination costs are deferred in other assets on the consolidated balance sheets and amortized on a straight-line basis over the privilege period, which is 12 months, within interest income—loans in the consolidated statements of operations and comprehensive income (loss).

During the year ended December 31, 2021, we amortized $ 1,451 of deferred costs into interest income and had a remaining balance of deferred costs of $ 3,422 within other assets as of December 31, 2021.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

Loan Commitments

2 unchanged sentences

SoFi is obligated to fund the loan at the committed terms on the disbursement date if the borrower does not cancel prior to the loan funding date.

The student loan commitments meet the scope exception under ASC 815 for issuers of commitments to originate non-mortgage loans.

The student loan commitments meet the scope exception for issuers of commitments to originate non-mortgage loans.

As the writer of the commitments, we elected the fair value option to measure our unfunded student loan commitments to align with the measurement methodology of our originated student loans.

As such, our student loan commitments are carried at fair value on a recurring basis.

Depending on the measurement date position, student loan commitments are presented within other assets or accounts payable, accruals and other liabilities in the consolidated balance sheets.

We classify student loan commitments as Level 3 because the valuations are highly dependent upon a loan funding probability, which is an unobservable input.

Loan commitments also include IRLCs, whereby we commit to interest rate terms prior to completing the origination process for home loans.

IRLCs are derivative instruments that are measured at fair value on a recurring basis.

Given that a home loan origination is contingent on a plethora of factors, our IRLCs are inherently uncertain and unobservable.

As such, we classify IRLCs as Level 3.

Changes in fair value are recognized within noninterest income—loan origination and sales in the consolidated statements of operations and comprehensive income (loss).

See “Derivative Financial Instruments” in this Note 1 for additional information on our derivative instruments.

See Note 15 for the key inputs used in the fair value measurements of our loan commitments.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

Revenue Recognition

In accordance with ASC 606, in each of our revenue arrangements, revenue is recognized when control of the promised goods or services is transferred to the customer in an amount that reflects our expected consideration in exchange for those goods or services.

Technology Platform Fees

Commencing in May 2020 with our acquisition of Galileo, we earn technology platform fees for providing an integrated platform-as-a-service for financial and non-financial institutions.

Within our technology platform fee arrangements, certain contracts contain a provision for a fixed, upfront implementation fee related to setup activities, which represents an advance payment for future technology platform services.

Our implementation fees are recognized ratably over the contract life, as we consider the implementation fee partially earned each month that we meet our performance obligation over the life of the contract.

We had deferred revenues of $ 2,553 and $ 2,520 as of December 31, 2021 and 2020, respectively, which are presented within accounts payable, accruals and other liabilities in the consolidated balance sheets.

During the years ended December 31, 2021 and 2020, we recognized revenue of $ 685 and $ 342 , respectively, associated with deferred revenues within noninterest income—technology platform fees in the consolidated statements of operations and comprehensive income (loss).

Sales commissions :

Capitalized sales commissions presented within other assets in the consolidated balance sheets, which are incurred in connection with obtaining a technology platform-as-a-service contract, were $ 678 and $ 527 as of December 31, 2021 and 2020, respectively.

Additionally, we incur ongoing monthly commissions, which are expensed as incurred, as the benefit of such sales efforts are realized only in the period in which the commissions are earned.

During the year ended December 31, 2021, commissions recorded within noninterest expense—sales and marketing in the consolidated statements of operations and comprehensive income (loss) were $ 3,302 , of which $ 267 represented amortization of capitalized sales commissions.

During the year ended December 31, 2020, commissions were $ 1,659 , of which $ 185 represented amortization of capitalized sales commissions.

Payments to customers :

Certain contracts include provisions for customer incentives, which may be payable up front or applied to future or past technology platform fees.

Payments to customers reduce the gross transaction price, as they represent constraints on the revenues expected to be realized.

Upfront customer incentives are recorded as prepaid assets and presented within other assets in the consolidated balance sheets, and are applied against revenue in the period such incentives are earned by the customer.

Customer incentives for future technology platform fees are applied ratably against future Technology Platform activity in accordance with the contract terms to the extent that cumulative revenues with the customer, net of incentives, are positive.

Any incentive in excess of cumulative revenues is expensed as a contract cost.

Customer incentives for past technology platform fees are recorded as a reduction to revenue in the period incurred, subject to the same cumulative revenue constraints.

Payment Network Fees

In customer arrangements separate from our technology platform fees, we earn payment network fees, which primarily constitute interchange fees, for satisfying our performance obligation to enable transactions through a payment network as the sponsor of such transactions.

Interchange fees, which are remitted by the merchant, are calculated by multiplying a set fee percentage (as stipulated by the debit card payment network) by the transaction volume processed through such network.

Transaction volume and related fees payable to us for interchange and other network fees are reported to us on a daily basis.

Therefore, there is no constrained variable consideration within a reporting period.

Using the expected value method, we assign a 100 % probability to the transaction price as calculated using actual transaction volume processed through the payment network.

Our performance obligation is completely satisfied once we successfully fulfill a requested transaction.

We measure our progress toward complete satisfaction of our performance obligation using the output method, with processed transaction volume representing the measure that faithfully depicts the transfer of our services.

The value of our services is represented by the network fee rates, as stipulated by the applicable payment network.

In addition to payment network fees earned on our own branded cards, we also earn payment network fees for serving as a transaction card program manager for enterprise customers that are the program marketers for separate card programs.

In these arrangements, we have two performance obligations:

i) performing card program services, and ii) performing transaction

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

card enablement services, for which we arrange for performance by the network associations and bank issuers to enable certain aspects of the transaction card process.

The transaction price in these arrangements is largely dependent on network association guidelines and the program management economics are pooled, with the Company receiving a contractual share of payment network fees.

The payment network fees are determined based on the type and volume of monthly card program activity and, therefore, represent variable consideration, as such amounts are not known at contract inception.

However, as payment network fees are settled on a monthly basis, the variable consideration within a reporting period is not constrained.

We satisfy both performance obligations continuously throughout the contractual arrangements and our customers receive and consume the benefits simultaneously as we perform.

Further, satisfaction of both performance obligations occurs within the same measurement period.

As such, allocation of the transaction price between the performance obligations is not meaningful, as it would not impact the pattern of revenue recognition.

Using the expected value method, we assign a 100 % probability to the transaction price as calculated using actual monthly card program activity.

Our program management performance obligations are completely satisfied once we successfully enable and process transaction card activity.

We measure our progress toward complete satisfaction of our performance obligations using the output method, with card program activity representing the measure that faithfully depicts the transfer of program management services.

The value of our services is represented by the transaction fee rates, as stipulated by the network association guidelines.

In our payment network fee transactions, we act in the capacity of an agent due to our lack of pricing power and because we are not primarily responsible for fulfilling the transaction enablement performance obligation, and ultimately lack control over fulfilling the performance obligations to the customer.

Therefore, we recognize revenue net of fees paid to other parties within the payment networks.

We earn specified referral fees in connection with referral activities we facilitate through our platform.

In one type of referral arrangement, the referral fee is paid to us by third-party partners that offer services to end users who do not use one of our product offerings, but who were referred to the partners through our platform.

As such, the third-party enterprise partners are our customers in these referral arrangements.

Our single performance obligation is to present referral leads to our enterprise partner customers.

In some instances, the referral fee is calculated by multiplying a set fee percentage by the dollar amount of a completed transaction between our partners and their customers.

In other instances, the referral fee represents the price per referral multiplied by the number of referrals (referred units) as measured by a consummated transaction between our partners and their customers.

As the transaction volume or referred units are not known at contract inception, these arrangements contain variable consideration.

However, as referral fees are billed to, and collected directly from, our partners on a monthly basis, the variable consideration within a reporting period is not constrained.

We recognize revenue at the time of a referral-based transaction by applying the expected value method, wherein we assign 100 % probability to the transaction price as calculated using actual transaction volume or referred units.

We satisfy our performance obligation continuously throughout the contractual arrangements with our partners and our partners receive and consume the benefits simultaneously as we perform.

Our referral fee performance obligation is completely satisfied once we provide referrals to our partners and there is a consummated transaction.

We measure our progress toward complete satisfaction of our performance obligation using the output method, with referred units or referred transaction volume representing the measure that faithfully depicts the transfer of referral services to our partners.

The value of our services transferred to our partners is represented by the referral fee rate, as agreed upon at contract inception.

In this type of referral arrangement, we act in the capacity of a principal, as we are primarily responsible for fulfilling our referral promise to our enterprise customers, exhibit control, and have discretion in setting the price we charge to our enterprise customers.

Therefore, we present our revenue on a gross basis.

Beginning in the third quarter of 2021, we entered into another type of referral arrangement whereby we earn referral fulfillment fees for providing pre-qualified borrower referrals to a third-party partner who separately contracts with a loan

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

originator, which is our single performance obligation in the arrangement.

Under the initial agreement, the referral fulfillment fee was determined as the lower of a fixed per-loan amount or the multiplication of a set fee percentage by the aggregate loan origination principal balance.

Through amendments to the agreement executed during the fourth quarter of 2021, the referral fulfillment fee on each referred loan is determined as either of two fixed amounts based on the aggregate origination principal balance of the loan.

In the event that a loan is determined to be ineligible and such loan becomes a charged-off loan, both as defined in the contract agreement (referred to as an “ineligible charged-off loan”), we must re-pay to the customer the outstanding principal amount plus all accrued but unpaid interest of the ineligible charged-off loan, as well as a pro rata amount of fees previously paid for the ineligible charged-off loan (referred to as the “referral fulfillment fee penalty”).

As the number and size of referred loans are not known at contract inception, this arrangement contains variable consideration that is constrained due to the potential reversal of referral fulfillment fees.

We elected to estimate the amount of variable consideration using the expected value method, wherein we evaluate the conditional probability of ineligible loan charge-offs and, thereby, estimate referral fulfillment fee penalties.

This method is appropriate for our arrangement, as we have meaningful experience through our lending business in evaluating expected ineligible referrals.

The revenue recognized using the expected value method reflects our estimated net referral fulfillment fees after adjusting for the estimated referral fulfillment fee penalty.

Referral fulfillment fees are presented within noninterest income—other in the consolidated statements of operations and comprehensive income (loss).

We recognize a liability within accounts payable, accruals and other liabilities in the consolidated balance sheets for the estimated referral fulfillment fee penalty, which represents the amount of consideration received that we estimate will reverse.

The liability was $ 118 as of December 31, 2021.

We satisfy our performance obligation continuously throughout the contractual arrangement with our customer and our customer receives and consumes the benefits simultaneously as we perform.

We completely satisfy our performance obligation each time we provide a loan referral and our customer purchases the underlying loan from the third-party loan originator.

We apply the right-to-invoice practical expedient to recognize referral fulfillment fees, as our right to consideration corresponds directly with the value of the service received, as measured using the expected value method and application of the referral fulfillment fee rate.

In this arrangement, we act in the capacity of a principal, as we are primarily responsible for fulfilling our referral obligation to our customer, we have risk of loss if the loans that comprise our referral fulfillment services do not meet the contractual eligibility standards, and we have discretion in setting the price we charge to our customer.

Therefore, we present our revenue on a gross basis.

Enterprise Services

We earn specified enterprise services fees in connection with services we provide to enterprise partners.

In one type of enterprise services arrangement, we earn fees in connection with services we provide to enterprise partners to facilitate transactions for the benefit of their employees, such as 529 plan contributions or student loan payments, which represents our single performance obligation in the arrangements.

Similar to our referral services, we agree on a rate per transaction with each of our customers, which represents variable consideration at contract inception.

However, as enterprise service fees are billed to, and collected directly from, our partners on a monthly basis, the variable consideration within a reporting period is not constrained.

We satisfy our performance obligation to provide enterprise services continuously throughout our contractual arrangements with our enterprise partners.

Our enterprise partners receive and consume the benefits of our enterprise services simultaneously as we perform.

Our enterprise service performance obligation is completely satisfied upon completion of a transaction on behalf of our enterprise partners.

For instance, we may facilitate student loan payments made by enterprise partners on behalf of their employees by directing those payments to the appropriate student loan servicer.

Once the student loan servicer recognizes the payment, the transaction and our performance obligation are simultaneously complete.

We measure our progress toward complete satisfaction of our performance obligation using the output method, with completed transaction requests representing the measure that faithfully depicts the transfer of enterprise services.

The value of our enterprise services is represented by a negotiated fee, as agreed upon at contract inception.

Our revenue is reported on a gross basis, as we act in the capacity of a principal, demonstrate the requisite control over the service, and are primarily responsible for fulfilling the performance obligation to our enterprise service customer.

Beginning in the second quarter of 2021, we entered into another type of enterprise services arrangement whereby we earn fees for providing advisory services in connection with helping operating companies successfully complete the business combination process, inclusive of obtaining the required shareholder votes.

The amount of revenue is recorded on a gross basis

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

within noninterest income—other in the consolidated statements of operations and comprehensive income (loss), as we fully control the fulfillment of our performance obligation acting in the capacity of a principal.

Out-of-pocket expenses associated with satisfying the performance obligation are recognized at the time the related revenue is recognized and presented as part of noninterest expense—general and administrative .

Equity Capital Markets Services

Beginning in the second quarter of 2021, we earned underwriting fees related to our membership in underwriting syndicates for initial public offerings (“IPOs”).

The underwriting of securities is the only performance obligation in our underwriting agreements, and we recognize underwriting fees on the trade date.

We are a principal in our underwriting agreements, because we demonstrate the requisite control over the satisfaction of the performance obligation through the assumption of underwriter liability for our designated share allotment.

As such, we recognize revenue on a gross basis.

Beginning in the fourth quarter of 2021, we also earned dealer fees for providing dealer services in partnership with underwriting syndicates for IPOs.

We are engaged to place IPO shares that are allocated to us by the underwriters with third-party investors for which we have received a confirmed order, which represents our only performance obligation in the arrangement.

The amount of consideration to which we are entitled represents the selling concession (spread between our purchase price and the offer price, which are set by the underwriting syndicate), multiplied by the number of shares we placed in the IPO deal.

The share allocation is ultimately determined by the underwriter.

We recognize revenue on the trade date.

We are an agent in this arrangement, as we do not share in any underwriting liability, do not bear risk of loss if shares remain unpurchased, and do not establish the price, which is set by the underwriting syndicate.

As the amount of dealer fees recognized is reflective of the number of allocated shares we sold to third-party investors, we apply the right-to-invoice practical expedient.

We recognize equity capital markets services revenue, consisting of both underwriting fees and dealer fees, within noninterest income—other in the consolidated statements of operations and comprehensive income (loss).

We earn fees in connection with facilitating investment-related transactions through our platform, which constitutes our single performance obligation in the arrangements.

Our performance obligation is determined by the specific service selected by the customer, such as brokerage transactions, share lending, digital assets transactions and exchange conversion.

In certain brokerage transactions, we act in the capacity of a principal and earn negotiated fees based on the number and type of transactions requested by our customers.

In our share lending arrangements and pay for order flow arrangements, we do not oversee the execution of the transactions, and ultimately lack requisite control, but benefit through a negotiated revenue sharing arrangement.

Therefore, we act in the capacity of an agent and recognize revenue net of fees paid to satisfy the performance obligation.

In our digital assets arrangements, our fee is calculated as a negotiated percentage of the transaction volume.

In these arrangements, we act in the capacity of a principal and recognize revenue gross of the fees we pay to obtain the digital assets for access by our members.

In our exchange conversion arrangements, we act in the capacity of a principal and earn fees for exchanging one currency for another.

As the investment-related transaction volume and type are not known at contract inception, these arrangements contain variable consideration.

However, as our brokerage fees are settled on a monthly basis or sometimes daily basis, the variable consideration within a reporting period is not constrained.

We recognize revenue at the time of an investment transaction by applying the expected value method, wherein we assign 100 % probability to the transaction price as calculated using actual investment transaction activity.

Our brokerage performance obligation is completely satisfied upon completion of an investment-related transaction.

We measure our progress toward complete satisfaction of our performance obligation using the output method, with investment transaction activity representing the measure that faithfully depicts the transfer of brokerage services.

The value of our brokerage services is represented by the transaction fees, as determined at the point of transaction.

We incur costs for clearing and processing services that relate to satisfied performance obligations within our brokerage arrangements.

In accordance with ASC 340-40, Other Assets and Deferred Costs — Contracts with Customers , we expense these costs as incurred.

Although certain of our commission costs qualify for capitalization, their amortization period is less than one year.

Therefore, utilizing the practical expedient related to incremental costs of obtaining a contract, we expense

In each of our revenue arrangements, revenue is recognized when control of the promised goods or services is transferred to the customer in an amount that reflects our expected consideration in exchange for those goods or services.

Our primary revenue streams for the periods presented include the following:

• Technology Products and Solutions:

We earn fees for providing an integrated platform as a service for financial and non-financial institutions.

We earn specified referral fees in connection with referral activities we facilitate through our platform, such as referrals to third-party partners that offer services to end users who do not use one of our product offerings and referrals of pre-qualified borrowers to a third-party partner who separately contracts with a loan originator.

• Interchange:

We earn interchange fees from debit and credit cardholder transactions conducted through payment networks.

• Brokerage :

We earn fees in connection with facilitating investment-related transactions through our platform, such as brokerage transactions, share lending, digital assets transactions and exchange conversion.

See Note 3 for additional information on our revenue recognition policy within each revenue stream.

Advertising, Sales and Marketing

Advertising production costs and advertising communication costs, as well as amounts paid to various affiliates to market our products, are included within noninterest expense—sales and marketing in the consolidated statements of operations and comprehensive income (loss).

Advertising costs are expensed either as incurred or when the advertising takes place, depending on the nature of the advertising activity.

For the years ended December 31, 2022, 2021 and 2020, advertising totaled $ 256,125 , $ 183,106 and $ 138,888 , respectively.

Expenses incurred by us related to member acquisition, including brand development, business development and direct member marketing expenses, are also presented within noninterest expense—sales and marketing in the consolidated statements of operations and comprehensive income (loss).

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

these costs as incurred.

Additionally, we pay upfront account funding incentives to customers that are not tied to a contract period.

Therefore, we expense these payments as incurred.

In the fourth quarter of 2021, we introduced a flat monthly platform fee that is charged to members associated with our 8 Limited business in Hong Kong.

The fee is assessed at each month end on all members with at least one open 8 Limited brokerage account (with the exception of accounts for which the applicable fee exceeds the account’s net asset value at month end) regardless of the volume or frequency of trading activity during the month.

The fee is deducted directly from the member’s primary brokerage account on the first day of the subsequent month.

Our single performance obligation is to stand ready to provide the specific brokerage service selected by the member.

As the number of members with open accounts that satisfy the net asset value threshold at any month end are not known at contract inception, this arrangement contains variable consideration.

However, as the monthly platform fees are settled on a monthly basis, the variable consideration within a reporting period is not constrained.

Our members simultaneously receive and consume the benefits of our platform throughout the month to which the fee applies.

We apply the right-to-invoice practical expedient to recognize the monthly platform fee, as the amount to which we are entitled at month end corresponds to the value of our performance completed for the month.

Contract Assets

As of December 31, 2021 and 2020, accounts receivable, net associated with revenue from contracts with customers was $ 33,748 and $ 23,278 , respectively, which were reported within other assets in the consolidated balance sheets.

Disaggregated Revenue

For the periods accounted for in accordance with ASC 606, the table below presents revenue from contracts with customers disaggregated by type of service, which best depicts how the revenue and cash flows are affected by economic factors, and by the reportable segment to which each revenue stream relates.

Revenues from contracts with customers are presented within noninterest income—technology platform fees and noninterest income—other in the consolidated statements of operations and comprehensive income (loss).

There are no revenues from contracts with customers attributable to our Lending segment for any of the years presented.

Year Ended December 31,

2021 2020 2019

Financial Services

$ 15,750 $ 5,889 $ 3,652

22,733 3,470 84

Payment network

10,642 2,433 660

Equity capital markets services 2,643 — —

Enterprise services

2,898 244 124

$ 54,666 $ 12,036 $ 4,520

Technology Platform

Technology platform fees

$ 191,847 $ 90,128 $ —

Payment network

1,205 1,167 —

$ 193,052 $ 91,295 $ —

Total Revenue from Contracts with Customers

Technology platform fees

$ 191,847 $ 90,128 $ —

15,750 5,889 3,652

Payment network

11,847 3,600 660

22,733 3,470 84

Equity capital markets services 2,643 — —

Enterprise services

2,898 244 124

$ 247,718 $ 103,331 $ 4,520

SoFi Technologies, Inc.

1 unchanged sentence

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

Advertising, Sales and Marketing

Included within noninterest expense—sales and marketing in the consolidated statements of operations and comprehensive income (loss) are advertising production costs and advertising communication costs, as well as amounts paid to various affiliates to market our products.

For the years ended December 31, 2021, 2020 and 2019, advertising totaled $ 183,106 , $ 138,888 and $ 169,942 , respectively.

Advertising costs are expensed either as incurred or when the advertising takes place, depending on the nature of the advertising activity.

Technology and Product Development

Expenses incurred by us related to technology, product design and implementation, which includes compensation and benefits, are classified as noninterest expense—technology and product development in the consolidated statements of operations and comprehensive income (loss).

Occupancy-related costs, which primarily relate to the operations of our leased office spaces, were $ 33,170 , $ 28,949 , and $ 25,946 for the years ended December 31, 2022, 2021 and 2020, respectively.

Occupancy-related expenses are presented within each of the financial statement line items within noninterest expense in the consolidated statements of operations and comprehensive income (loss).

Loss Contingencies

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Due to the inherent uncertainties of loss contingencies, estimates may be different from the actual outcomes.

With respect to legal proceedings, we recognize legal fees as they are incurred within noninterest expense—general and administrative in our consolidated statements of operations and comprehensive income (loss).

With respect to legal proceedings, we recognize legal fees as they are incurred within noninterest expense—general and administrative in the consolidated statements of operations and comprehensive income (loss).

See Note 18 for discussion of contingent matters.

Compensation and Benefits

Total compensation and benefits, inclusive of share-based compensation expense, was $ 830,298 , $ 608,505 and $ 385,745 for the years ended December 31, 2022, 2021 and 2020, respectively.

Compensation and benefits expenses are presented within each of the financial statement line items within noninterest expense in the consolidated statements of operations and comprehensive income (loss).

Share-Based Compensation

1 unchanged sentence

Share-based compensation expense is allocated among the components of noninterest expense in the consolidated statements of operations and comprehensive income (loss).

We use the Black-Scholes Option Pricing Model (the “Black-Scholes Model”) to estimate the fair value of stock options.

We used the Black-Scholes Option Pricing Model (the “Black-Scholes Model”) to estimate the grant-date fair value of stock options.

RSUs are measured based on the fair values of the underlying stock on the dates of grant.

We use a Monte Carlo simulation model to estimate the fair value of PSUs.

We use a Monte Carlo simulation model to estimate the grant-date fair value of PSUs.

We recognize forfeitures as incurred and, therefore, reverse previously recognized share-based compensation expense at the time of forfeiture.

See Note 16 for further discussion of share-based compensation.

Comprehensive Loss

Comprehensive loss consists of net loss, unrealized gains or losses on our investments in AFS debt securities and foreign currency translation adjustments.

We recognize deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial reporting and tax basis of assets and liabilities, as well as for operating loss and tax credit carryforwards.

2 unchanged sentences

Valuation allowances are recorded to reduce deferred tax assets to the amount we believe is more likely than not to be realized.

The tax effects from an uncertain tax position can be recognized in the financial statements only if the tax position would more likely than not be upheld on examination by the taxing authorities based on the merits of the tax position.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

We follow accounting guidance in ASC 740, Income Taxes , as it relates to uncertain tax positions, which provides information and procedures for financial statement recognition and measurement of tax positions taken, or expected to be taken, in tax returns.

Management is required to analyze all open tax years, as defined by the statute of limitations, for all jurisdictions.

We accrue tax penalties and interest, if any, as incurred and recognize them within income tax (expense) benefit in our consolidated statements of operations and comprehensive income (loss).

We accrue tax penalties and interest, if any, as incurred and recognize them within income tax (expense) benefit in the consolidated statements of operations and comprehensive income (loss).

Related Parties

We define related parties as members of our Board of Directors, entity affiliates, executive officers and principal owners of our outstanding stock and members of their immediate families.

Related parties also include any other person or entity with significant influence over our management or operations.

Recently Adopted Accounting Standards

Safeguarding Assets and Liabilities

In March 2022, the SEC released SAB 121, which provides interpretive guidance for an entity to consider when it has obligations to safeguard crypto-assets held for its platform users, whether directly or through an agent or another third party acting on its behalf.

SAB 121 requires an entity to record a liability to reflect its obligation to safeguard the crypto-assets, as well as a corresponding safeguarding asset, both of which should be measured at the fair value of the crypto-assets being safeguarded for the entity’s users.

Entities should evaluate any potential loss events, such as theft, loss or destruction of the cryptographic keys, that may affect the measurement of the asset.

SAB 121 also requires financial statement disclosure, including the nature and amount of crypto-assets that the entity holds for its users, any vulnerabilities that may arise as a result of any concentration in crypto-assets, and information about who is responsible for the record-keeping of the crypto-assets, the holding of the cryptographic keys and safeguarding the crypto-assets, among other disclosure considerations.

Disclosures must also be made in accordance with fair value measurements accounting guidance.

SAB 121 was effective for us for the interim period ending June 30, 2022.

We applied the guidance through retrospective application as of January 1, 2022, at which time the value of our members’ digital assets was $ 266,014 .

As of June 30, 2022, the adoption date, the value of our members’ digital assets was $ 112,010 .

At each reporting date subsequent to adoption, we determine the value of our members’ digital assets and remeasure our digital assets safeguarding liability and corresponding digital assets safeguarding asset.

Our application of this guidance did not impact our results of operations.

We also enhanced our disclosures around our digital assets arrangements and our role in safeguarding them.

See this Note 1 and Note 15 for the applicable disclosures.

Accounting for Contract Assets and Contract Liabilities from Contracts with Customers

In October 2021, the FASB issued Accounting Standards Update (“ASU”) 2021-08, Business Combinations (Topic 805):

Accounting for Contract Assets and Contract Liabilities from Contracts with Customers .

The ASU requires entities to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with accounting guidance for revenue from contracts with customers, rather than at fair value.

The standard should be applied prospectively to business combinations occurring on or after the effective date of the amendments.

We early adopted the standard effective January 1, 2022 and applied its provisions to our acquisitions in 2022.

The adoption of this standard did not have a material impact on our consolidated financial statements.

Facilitation of the Effects of Reference Rate Reform on Financial Reporting

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The new standard provides for optional expedients and other guidance regarding the accounting related to modifications of contracts, hedging relationships and other transactions affected by reference rate reform.

ASU 2020-04 and ASU 2021-01 were both effective upon issuance and may be applied to contract modifications from January 1, 2020 through December 31, 2022.

The Alternative Reference Rates Committee (“ARRC”), a group of private market participants, was convened in the United States by the Federal Reserve Board and the Federal Reserve Bank of New York in cooperation with other United States agencies to promote the successful transition from United States Dollar LIBOR (“USD LIBOR”).

The ARRC has selected the Secured Overnight Financing Rate (“SOFR”) as their recommended alternative to USD LIBOR.

After December 31, 2021, the ICE Benchmark Administration Limited, the administrator of LIBOR (the “IBA”), ceased publishing the one-week and two-month USD LIBOR tenors.

We do not have any exposure to these tenors.

The IBA expects to continue to publish all remaining USD LIBOR tenors through June 30, 2023, with the overnight and 12-month tenors ceasing immediately thereafter and the one-month, three-month and six-month tenors becoming non-representative from that date.

In December 2022, the FASB issued ASU 2022-06, Reference Rate Reform (Topic 848):

Deferral of the Sunset Date of Topic 848 , which extends the relief period for relevant contract modifications to December 31, 2024.

We adopted the provisions of the standard in the fourth quarter of 2021 using the prospective method of adoption.

We established a cross-functional project team to execute our company-wide transition away from USD LIBOR.

In the fourth quarter of 2021, we began to use SOFR as the pricing index on all new variable-rate loan originations, and on new warehouse facility agreements and other financial instruments.

In the fourth quarter of 2021, we began to use the Secured Overnight Financing Rate (“SOFR”) or an alternative reference rate on new variable-rate loan originations, and on new warehouse facility agreements and other financial instruments.

We also transitioned some existing warehouse facility lines to SOFR and elected to apply the optional expedients when all such terms were related to the replacement of the reference rate.

We are continuing to review existing variable-rate loans, borrowings, Series 1 redeemable preferred stock dividends and derivative instruments that utilize USD LIBOR as the reference rate and expect to continue transitioning these instruments to SOFR or other representative alternative reference rates throughout 2022 in accordance with the provisions of the standard.

We do not expect there to be a material impact on our consolidated financial statements as a result of adopting this standard.

Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity

In August 2020, the FASB issued ASU 2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40):

Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity .

This ASU simplifies the accounting for certain convertible instruments, amends the guidance on derivative scope exceptions for contracts in an entity’s own equity, and modifies the guidance on diluted earnings per share calculations as a result of these changes.

The standard is effective for fiscal years and interim periods beginning after December 15, 2023, with early adoption permitted.

We early adopted the provisions of ASU 2020-06 effective January 1, 2021.

The adoption of this standard did not have an impact on our consolidated financial statements, as we had no notes prior to an issuance in October 2021.

The notes issued in October 2021 were accounted for in accordance with this standard.

Business Combinations

Merger with Social Capital Hedosophia Holdings Corp.

On January 7, 2021, Social Finance entered into the Agreement by and among Social Finance, SCH, a Cayman Islands exempted company limited by shares, and Plutus Merger Sub Inc., a Delaware corporation and a wholly owned subsidiary of SCH (“Merger Sub”).

Pursuant to the Agreement, Merger Sub merged with and into Social Finance.

Upon the Closing on May

We are continuing to review existing variable-rate loans, borrowings, Series 1 redeemable

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

28, 2021, the separate corporate existence of Merger Sub ceased and Social Finance survived the merger and became a wholly-owned subsidiary of SCH.

preferred stock dividends and derivative instruments that utilize USD LIBOR as the reference rate and expect to continue transitioning these instruments to SOFR or other representative alternative reference rates in accordance with the provisions of the standard.

We do not expect there to be a material impact on our consolidated financial statements as a result of applying this standard.

Recent Accounting Standards Issued, But Not Yet Adopted

Troubled Debt Restructurings and Vintage Disclosures

In March 2022, the FASB issued ASU 2022-02, Financial Instruments — Credit Losses (Topic 326):

Troubled Debt Restructurings and Vintage Disclosures .

The ASU addresses two topics:

(i) troubled debt restructuring (“TDR”) by creditors, and (ii) vintage disclosures for gross write offs.

Under the TDR provisions, the ASU eliminates the recognition and measurement guidance under Accounting Standards Codification (“ASC”) 310-40, Receivables—Troubled Debt Restructurings by Creditors , and instead requires that an entity evaluate whether the modification represents a new loan or a continuation of an existing loan, consistent with the accounting for other loan modifications.

Additionally, the ASU enhances existing disclosure requirements around TDRs and introduces new requirements related to certain modifications of receivables made to borrowers experiencing financial difficulty.

Under the vintage disclosure provisions, the ASU requires the entity to disclose current period gross write offs by year of origination for financing receivables and net investments in leases within the scope of ASC 326-20, Financial Instruments—Credit Losses—Measured at Amortized Cost .

The standard is effective for fiscal years and interim periods beginning after December 15, 2022.

The standard should be applied prospectively;

however, for the TDR provisions, an entity has the option to apply a modified retrospective transition method.

We do not expect the provisions of this standard to have a material impact on our consolidated financial statements.

Business Combinations

Merger with Social Capital Hedosophia Holdings Corp.

On January 7, 2021, Social Finance entered into an agreement by and among Social Finance, SCH, a Cayman Islands exempted company limited by shares, and Plutus Merger Sub Inc., a Delaware corporation and a wholly owned subsidiary of SCH (“Merger Sub”), pursuant to which Merger Sub merged with and into Social Finance.

Upon the Closing on May 28, 2021, the separate corporate existence of Merger Sub ceased and Social Finance survived the merger and became a wholly-owned subsidiary of SCH.

On May 28, 2021, SCH also filed a notice of deregistration with the Cayman Islands Registrar of Companies, together with the necessary accompanying documents, and filed a certificate of incorporation and a certificate of corporate domestication with the Secretary of State of the State of Delaware, under which SCH was domesticated as a Delaware corporation, changing its name from “Social Capital Hedosophia Holdings Corp.

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At the Closing, we received gross cash consideration of $ 764.8 million as a result of the reverse recapitalization, which was then reduced by:

• A redemption of redeemable common stock (classified as temporary equity) of $ 150.0 million;

• A special payment (as discussed in Note 12), which was accounted for as an embedded derivative, and made to our Series 1 preferred stockholders of $ 21.2 million (which was expensed as incurred);

• Our equity issuance costs.

In connection with the Business Combination, Social Finance incurred $ 27.5 million of equity issuance costs, consisting of advisory, legal, share registration and other professional fees, which were recorded within additional paid-in capital as a reduction of proceeds.

We paid $ 0.6 million of the equity issuance costs during 2020.

(i) a redemption of redeemable common stock (classified as temporary equity) of $ 150.0 million, (ii) a special payment made to our Series 1 preferred stockholders of $ 21.2 million (which was expensed as incurred), and (iii) our equity issuance costs of $ 27.5 million, consisting of advisory, legal, share registration and other professional fees, which were recorded within additional paid-in capital as a reduction of proceeds.

In connection with the Business Combination, SCH entered into subscription agreements with certain investors (the “Third Party PIPE Investors”), whereby it issued 122,500,000 shares of common stock at $ 10.00 per share (“PIPE Shares”) for an aggregate purchase price of $ 1.225 billion (“PIPE Investment”), which closed simultaneously with the consummation of the Business Combination.

Upon the Closing, the PIPE Shares were automatically converted into shares of SoFi Technologies common stock on a one -for-one basis.

Upon the Closing, holders of Social Finance common stock received shares of SoFi Technologies common stock in an amount determined by application of the exchange ratio of 1.7428 (“Exchange Ratio”), which was based on Social Finance’s implied price per share prior to the Business Combination.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

implied price per share prior to the Business Combination.

Additionally, holders of Social Finance preferred stock (with the exception of the Series 1 preferred stockholders) received shares of SoFi Technologies common stock in amounts determined by application of either the Exchange Ratio or a multiplier of the Exchange Ratio, as provided by the Agreement.

Acquisition of Golden Pacific Bancorp, Inc.

On February 2, 2022, we acquired Golden Pacific, pursuant to an Agreement and Plan of Merger entered into by and among the Company, a wholly-owned subsidiary of the Company and Golden Pacific in March 2021, pursuant to which we acquired all of the outstanding equity interests in Golden Pacific and its wholly-owned subsidiary, Golden Pacific Bank, for total cash purchase consideration of $ 22.3 million using cash on hand.

After closing the Bank Merger, we became a bank holding company and Golden Pacific Bank began operating as SoFi Bank, National Association (“SoFi Bank”).

On February 2, 2022, we acquired Golden Pacific, pursuant to an Agreement and Plan of Merger dated as of March 8, 2021 by and among the Company, a wholly-owned subsidiary of the Company, and Golden Pacific.

In the business combination, we acquired all of the outstanding equity interests in Golden Pacific for total cash purchase consideration of $ 22.3 million (the “Bank Merger”).

After closing the Bank Merger, we became a bank holding company and Golden Pacific began operating as SoFi Bank.

We are duly registered as a bank holding company with the Federal Reserve.

SoFi Bank is a national banking association whose primary federal regulator is the OCC.

Deposit accounts of SoFi Bank are insured by the FDIC through the Deposit Insurance Fund to the fullest extent permitted by law.

Deposit accounts of SoFi Bank are insured by the Federal Deposit Insurance Corporation (the “FDIC”) through the Deposit Insurance Fund to the fullest extent permitted by law.

The closing of the Bank Merger was subject to regulatory approval.

On January 18, 2022, we received approval from the Federal Reserve of our application to become a bank holding company under the Bank Holding Company Act, and we received conditional approval from the OCC to close the Bank Merger.

The OCC also approved our application to change the composition of Golden Pacific Bank’s assets in connection with the Bank Merger.

The OCC also approved our application to change the composition of Golden Pacific’s assets in connection with the Bank Merger.

The OCC conditional approval imposed a number of conditions, including that SoFi Bank have initial paid-in capital of no less than $ 750 million and adhere to an operating agreement.

Golden Pacific Bank’s community bank business will continue to operate as a division of SoFi Bank.

Golden Pacific’s community bank business continues to operate as a division of SoFi Bank.

A portion of the total cash purchase consideration ($ 0.6 million) was held back by the Company to satisfy any indemnification or certain other obligations (“Holdback Amount”), as certain legal proceedings with which Golden Pacific is involved as a plaintiff were not resolved at the time the Bank Merger closed.

The Holdback Amount will be used for further financing or costs incurred associated with the litigation and any remaining amount upon resolution of the litigation will be

During 2022, we incurred costs associated with the litigation involving Golden Pacific as a plaintiff in excess of the Holdback Amount.

Therefore, none of the Holdback Amount will be released to the Golden Pacific shareholders.

Additionally, we held back a $ 3.3 million payable to a dissenting Golden Pacific shareholder pending resolution of the shareholder’s dissenter’s rights appraisal claim, which could possibly result in a lower or higher amount paid to the dissenting shareholder once a ruling is made regarding the appraisal claim.

The Bank Merger was accounted for as a business combination.

The preliminary purchase consideration was allocated to the tangible and intangible assets acquired and liabilities assumed based on the estimated fair values as of the acquisition date.

The excess of the total purchase consideration over the fair value of the net assets acquired of $ 11.2 million was allocated to goodwill, none of which is expected to be deductible for tax purposes, and which is allocated to our Financial Services segment.

Goodwill is primarily attributable to the expected benefits of operating a national bank.

The results of operations of Golden Pacific subsequent to the date of acquisition are included in SoFi’s consolidated financial statements as of and for the year ended December 31, 2022.

As the acquisition was not determined to be a significant acquisition, we do not disclose the pro forma impact of this acquisition to the results of operations in our interim and annual filings with the SEC.

Identifiable intangible net assets at the date of acquisition included finite-lived intangible assets for core deposits with an aggregate fair value of $ 1.0 million.

The intangible assets are being amortized over a period of 7.3 years based on the estimated economic life of the underlying assets.

We incurred total acquisition-related costs related to the Bank Merger of $ 2.2 million, which were incurred during the year ended December 31, 2021, and are presented within noninterest expense—general and administrative in the consolidated statements of operations and comprehensive income (loss).

Acquisition of Technisys S.A.

On March 3, 2022, we acquired Technisys S.A., a Luxembourg société anonyme, (“Technisys”), pursuant to an Agreement and Plan of Merger dated as of February 19, 2022 and amended as of March 3, 2022, by and among the Company, Technisys, Atom New Delaware, Inc., a Delaware corporation and a wholly owned subsidiary of Atom, and Atom Merger Sub Corporation, a Delaware corporation and wholly owned subsidiary of SoFi Technologies (“Technisys Merger”).

We acquired all of the outstanding equity interests in Technisys (the “Technisys Merger”).

The Technisys Merger was accounted for as a business combination.

Technisys is a cloud-native digital and core banking platform with an existing footprint of financial services customers in Latin America.

With the acquisition of Technisys, we expanded our technology platform services to a broader international

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

released to the Golden Pacific shareholders.

Additionally, we held back a $ 3.3 million payable to a dissenting Golden Pacific Bank shareholder pending resolution of the shareholder’s appraisal claim, which could possibly result in a lower or higher amount paid to the dissenting shareholder once a ruling is made regarding the appraisal claim.

The Bank Merger is being accounted for as a business combination.

The results of operations of Golden Pacific are not included in SoFi’s consolidated financial statements as of and for the year ended December 31, 2021.

Additionally, given the proximity of the closing of the Bank Merger to the issuance of our consolidated financial statements for the year ended December 31, 2021, the initial accounting for the business combination is incomplete.

The purchase consideration is being allocated to the tangible and intangible assets acquired and liabilities assumed based on the estimated fair values as of the acquisition date, which are being measured in accordance with the principles outlined in ASC 820.

The excess of the total purchase consideration over the fair value of the net assets acquired, if any, will be allocated to goodwill, none of which is expected to be deductible for tax purposes.

As the acquisition was not determined to be a significant acquisition under ASC 805, we do not intend to disclose the pro forma impact of this acquisition to the results of operations in our interim and annual filings with the SEC.

We incurred acquisition-related costs of $ 2.2 million related to the Bank Merger for the year ended December 31, 2021, which were presented within noninterest expense—general and administrative in the consolidated statements of operations and comprehensive income (loss).

Acquisition of Technisys S.A.

On February 19, 2022, we entered into an Agreement and Plan of Merger by and among the Company, Technisys S.A., a Luxembourg société anonyme (“Technisys”), Atom New Delaware, Inc., a Delaware corporation and a wholly owned subsidiary of Atom, and Atom Merger Sub Corporation, a Delaware corporation and wholly owned subsidiary of SoFi Technologies, pursuant to which we will acquire all of the outstanding equity interests in Technisys for total consideration, in the form of shares of SoFi common stock, of $ 1.1 billion (the “Technisys Merger”).

The shares of SoFi common stock issuable in connection with the acquisition are determined using the 20 -day volume-weighted average price of SoFi common stock as of February 15, 2022, and are subject to escrow requirements and other customary adjustments.

The Technisys Merger will be accounted for as a business combination.

Technisys is a cloud-native digital and core banking platform with an existing footprint of established banks, digital banks and fintechs in Latin America.

With the acquisition of Technisys, we can expand our technology platform services to a broader international market.

Through December 31, 2021, we incurred acquisition-related costs of $ 3.3 million related to the Technisys Merger, which were presented within noninterest expense—general and administrative in the consolidated statements of operations and comprehensive income (loss).

Acquisition of Galileo Financial Technologies, Inc.

On May 14, 2020, we acquired Galileo Financial Technologies, Inc.

and its subsidiaries (“Galileo”) by acquiring 100 % of the outstanding Galileo stock as of that date for total consideration of $ 1.2 billion.

Galileo primarily provides technology platform services to financial and non-financial institutions.

Our acquisition of Galileo enabled us to diversify our business from primarily consumer based to also serve institutions that rely upon Galileo’s integrated platform as a service to serve their clients.

Upon the finalization of the closing net working capital calculation in April 2021, the total purchase price consideration was reduced by $ 743 , which was settled through the return to SoFi of an equivalent value of 83,856 previously issued Series H-1 preferred stock, which were retired upon receipt.

The adjustment similarly reduced the carrying value of

The following table presents the components of the purchase consideration to acquire Technisys as of December 31, 2022:

Fair value of common stock issued (1)

Amounts payable to settle vested employee performance awards (2)

Fair value of awards assumed (3)

Settlement of pre-combination transactions between acquirer and acquiree 235

Total purchase consideration

___________________

(1) Reflects the shares of SoFi common stock issued in the acquisition of 81,700,318 , multiplied by the closing stock price of SoFi common stock on the closing date of the Technisys Merger.

Additionally, these shares are inclusive of 6,305,595 shares that remain held in escrow.

These escrow shares are expected to be released no later than 15 months after the close of the acquisition.

(2) We made payments of $ 17,641 related to this component of purchase consideration during the year ended December 31, 2022.

(3) We contemporaneously converted outstanding performance awards into RSUs to acquire common stock of SoFi (“Replacement Awards”).

The fair value of awards assumed in the purchase consideration was based on the closing stock price of SoFi common stock on the closing date of the Technisys Merger.

Refer to Note 16 for additional information on our RSUs, including the Replacement Awards.

During the third quarter of 2022, we finalized the closing net working capital calculation specified in the merger agreement, which resulted in a reduction to the equity consideration of 155,794 shares, representing an adjustment to the total purchase consideration of $ 1,665 , and a corresponding reduction to the carrying value of recognized goodwill.

The remaining 442,274 shares that were held in escrow associated with the working capital calculation were released to the former Technisys shareholders.

The finalized closing net working capital calculation did not impact the estimated fair values of the assets acquired and liabilities assumed in conjunction with the transaction.

The following table presents the allocation of the total purchase consideration to the estimated fair values of the identified assets acquired and liabilities assumed of Technisys as of the date of acquisition.

The table reflects measurement period adjustments made during 2022, as well as an adjustment to the purchase consideration associated with the final working capital calculation, each of which also impacted the amount of recognized goodwill:

Preliminary Purchase Price Allocation Measurement Period Adjustments (1)

Updated Purchase Price Allocation

Assets acquired

Cash and cash equivalents

$ 25,710 $ — $ 25,710

Accounts receivable (2)

15,354 ( 2,942 ) 12,412

Intangible assets (3)

239,000 — 239,000

Operating lease right-of-use (“ROU”) assets

1,011 2,843 3,854

Total identifiable assets acquired

281,662 ( 99 ) 281,563

Liabilities assumed

Accounts payable, accruals and other liabilities

16,462 6,624 23,086

Operating lease liabilities 587 — 587

Deferred income taxes (4)

55,104 2,239 57,343

Total liabilities assumed

72,153 8,863 81,016

Total identified net assets acquired

209,509 ( 8,962 ) 200,547

705,920 7,297 713,217

Total consideration

$ 915,429 $ ( 1,665 ) $ 913,764

_________________

(1) The measurement period adjustments did not have a significant impact on our results of operations.

The adjustment to accounts payable, accruals and other liabilities included a tax payable adjustment of $ 6,484 .

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

recognized goodwill, and did not impact the estimated fair values of the assets acquired and liabilities assumed in conjunction with the transaction.

There were no other adjustments to goodwill during the year ended December 31, 2021.

The following unaudited supplemental pro forma financial information presents the Company’s consolidated results of operations for the years ended December 31, 2020 and 2019 as if the business combination had occurred on January 1, 2019:

(2) Included accounts receivable and unbilled revenue with a gross contractual amount of $ 14,768 .

At the date of acquisition, the Company expected $ 2,356 to be uncollectible.

(3) Intangible assets consist of finite-lived intangible assets, as follows:

Gross carrying amount

Weighted-average useful life (years)

Developed technology (a)

$ 187,000 8.8

Customer-related (b)

Trade names, trademarks and domain names (c)

__________________

(a) Valued using the Multi-Period Excess Earnings Method (“MPEEM”), which is a form of the income approach.

The significant assumptions include:

(i) the estimated annual net cash flows, which are a function of expected earnings attributable to the asset (and include an assumed technology migration curve), contributory asset charges and the applicable tax rate, and (ii) an assumed discount rate, which reflects the risk of the asset relative to the overall risk of Technisys.

(b) Valued using the With and Without Method, which is a form of the income approach.

The significant assumptions include:

(i) the estimated annual revenues and net cash flows both with the existing customer base and without the existing customer base, which include assumptions regarding revenue ramp-up periods and attrition rates, and (ii) an assumed discount rate, consistent with (a) above.

The significant assumptions include:

(i) the estimated annual net cash flows, which are a function of expected earnings attributable to the asset, the probability of use of the asset, the royalty rate and the applicable tax rate, and (ii) the discount rate, consistent with (a) above.

(4) The deferred tax liabilities recognized in the acquisition were primarily related to the acquired intangible assets, in which the acquiree had a significantly lower tax basis compared to the fair value.

(5) The excess of the total purchase consideration over the fair value of the identified net assets acquired was allocated to goodwill, no ne of which is expected to be deductible for tax purposes.

Goodwill is primarily attributable to expected growth opportunities at Technisys, and secondarily attributable to the expected synergies from leveraging the Technisys technology to enhance and expand Galileo’s product offerings and operations, as well as expand its market reach.

As such, all of the goodwill is allocated to the Technology Platform segment.

The Company incurred total acquisition-related costs related to the Technisys Merger of $ 20.7 million, of which $ 17.4 million were incurred during the year ended December 31, 2022 and $ 3.3 million were incurred during the year ended December 31, 2021, which were presented within noninterest expense—general and administrative in the consolidated statements of operations and comprehensive income (loss).

From the date of acquisition through December 31, 2022, the acquired results of operations for Technisys contributed total net revenue of $ 69.2 million and net loss of $ 24.7 million to the Company’s consolidated results, which was inclusive of amortization expense recognized on the acquired intangible assets.

The following unaudited supplemental pro forma financial information presents the Company’s consolidated results of operations as if the business combination had occurred on January 1, 2020:

Year Ended December 31,

2022 2021 2020

Total net revenue $ 1,584,439 $ 1,055,219 $ 624,983

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• incremental straight-line amortization expense associated with acquired intangible assets;

• adjustments to depreciation expense resulting from accounting policy alignment between the acquirer and acquiree;

• adjustments to reflect interest expense on the seller note, including accretion of interest and incremental interest incurred after the interest-free period lapsed as if the interest was incurred during the earliest period presented;

• an adjustment to reflect post-combination share-based compensation expense associated with options to acquire common stock of Galileo that were converted into options to acquire common stock of SoFi as if the conversion occurred on January 1, 2019;

• a reversal of the Company’s previously-established deferred tax asset valuation allowance of $ 99,793 resulting from deferred tax liabilities acquired in connection with the acquisition as if it occurred during the earliest period presented;

• an adjustment to reflect $ 9,341 of acquisition-related costs as if they were incurred during the earliest period presented;

• an adjustment to reflect post-combination share-based compensation expense associated with the Replacement Awards as if the conversion had occurred on January 1, 2020;

• an adjustment to reflect acquisition-related costs for both parties as if they were incurred during the earliest period presented;

• the related income tax effects, at the statutory tax rate applicable for each period, of the pro forma adjustments noted above.

The unaudited supplemental pro forma financial information does not give effect to any anticipated cost savings, operating efficiencies or other synergies that may be associated with the acquisition, or any estimated costs that have been or will be incurred by the Company to integrate the assets and operations of Galileo.

Other Acquisitions

On April 28, 2020, the Company acquired 100 % of the outstanding stock of 8 Limited, a Hong Kong brokerage services firm, for total consideration of $ 16,126 .

Part of the consideration consisted of Social Finance common stock, of which a portion was contingent on the satisfaction of certain representations and warranties.

During the fourth quarter of 2021, we issued 320,649 shares of SoFi Technologies common stock in satisfaction of the contingent consideration .

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

Goodwill and Intangible Assets

A rollforward of our goodwill balance is presented below as of the dates indicated:

Beginning balance

$ 899,270 $ 15,673

accumulated impairment

Beginning balance, net

899,270 15,673

Additional goodwill recognized (1)

Other adjustments (2)

Ending balance (3)

$ 898,527 $ 899,270

Technology Products and Solutions

We earn fees for providing an integrated platform as a service for financial and non-financial institutions.

Within our technology products and solutions fee arrangements, certain contracts contain a provision for a fixed, upfront implementation fee related to setup activities, which represents an advance payment for future technology platform services provided over the contract term.

These implementation fees are recognized ratably over the contract life.

Commencing in March 2022 with the Technisys Merger, we earn subscription and service fees for providing software licenses and associated services, including implementation and maintenance.

We charge a recurring subscription fee for the software license and related maintenance services.

Other software-related services are billed on a periodic basis as the services are provided.

Certain arrangements for software and related services contain a provision for a fixed upfront payment.

We recognize revenue related to software licenses at a point in time upon delivery of the license and the close of the user-acceptance testing period.

When implementation services are distinct, we recognize revenue over time during the implementation period.

We recognize maintenance services ratably over the contractual maintenance term.

If a fixed upfront payment provides a material right to the customer, we recognize revenue associated with the material right over the period of benefit associated with the right to subscribe or renew a subscription, which is typically the product life.

We allocate fees charged for software and related services to our performance obligations on the basis of the relative standalone selling price.

The standalone selling prices either represent the prices at which we separately sell each license or service or are estimated using available information, such as market conditions and internal pricing policies.

The standalone selling price of the software license and maintenance are determined based on the complexity and size of the license.

We had deferred revenue of $ 10,028 and $ 2,553 as of December 31, 2022 and 2021, respectively, which are presented within accounts payable, accruals and other liabilities in the consolidated balance sheets.

During the years ended December 31, 2022 and 2021, we recognized revenue of $ 7,773 and $ 685 , respectively, associated with deferred revenue within noninterest income—technology products and solutions in the consolidated statements of operations and comprehensive income (loss).

Payments to customers :

We may provide incentives to our technology platform customers, which may be payable up front or applied to future or past technology products and solutions fees.

Evaluating whether such incentives are payments to a customer requires judgment.

When we determine that an incentive is consideration payable to a customer, the incentive is recorded as a reduction of revenue.

Incentives that represent consideration payable to a customer may also contain variable consideration.

Therefore, such incentives are constraints on the revenue expected to be realized.

Any incentive in excess of cumulative revenue is expensed as a contract cost.

We earn specified referral fees in connection with certain referral activities we facilitate through our platform.

In one type of referral arrangement, we refer end users through our platform to third-party enterprise partners.

The third-party enterprise partners are our customers, and our single performance obligation is to present referral leads.

Our referral fee is calculated as either a fixed price per successful referral or a percentage of the transaction volume between the enterprise partners and referred consumers.

Our performance is satisfied over time and is measured under the expected value method based on the quantity of successful referrals or the referred transaction volume.

The value of our services transferred to our partners is represented by the referral fee rate agreed upon at contract inception.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

In another type of referral arrangement, we earn referral fulfillment fees for providing pre-qualified borrower referrals to a third-party partner who separately contracts with a loan originator.

Our referral fees are based on the referred loan amount, subject to a referral fulfillment fee penalty if a loan is determined to be ineligible and becomes a charged-off loan as defined in the contract.

We satisfy our performance obligation to provide borrower referrals over time as our customer purchases the successfully originated loans from the loan originator.

The referral fulfillment fee penalty represents variable consideration.

We allocate the variable consideration to the distinct period in which the referral services are delivered.

When pricing terms are not consistent throughout the entire term of the contract, we estimate variable consideration using the expected value method based on the estimated probability of ineligible loan charge-offs, which requires management judgment using our meaningful experience through our lending business.

We recognize revenue for each originated loan, less the estimated referral fulfillment fee penalty.

The estimated referral fulfillment fee penalty was immaterial as of December 31, 2022.

We earn interchange fees from debit and credit cardholder transactions conducted through payment networks.

Interchange fees from cardholder transactions represent a percentage of the underlying transaction value and are recognized daily, concurrently with the transaction processing services provided to the cardholder.

Interchange is presented net of cardholder rewards associated with card transactions.

We earn fees in connection with facilitating investment-related transactions through our platform, including brokerage transactions, share lending, digital assets transactions and exchange conversions, for which we may act in the capacity of a principal or an agent depending on the nature of our control and involvement.

In certain brokerage transactions, we act in the capacity of a principal and earn negotiated fees based on the number and type of transactions requested by our customers.

Therefore, we act in the capacity of an agent for share lending and recognize revenue net of fees paid to satisfy the performance obligation.

In our digital assets arrangements, our fee is calculated as a negotiated percentage of the transaction volume.

In these arrangements, we act in the capacity of a principal and recognize revenue gross of the fees we pay to obtain the digital assets for access by our members.

Our brokerage performance obligation is completely satisfied upon completion of an investment-related transaction.

We incur costs for clearing and processing services that relate to satisfied performance obligations within our brokerage arrangements, which are expensed as incurred.

Although certain of our commission costs qualify for capitalization, because their amortization period is less than one year, we expense these costs as incurred.

Additionally, we expense as incurred any upfront account funding incentives paid to customers that are not tied to a contract period.

Disaggregated Revenue

The table below presents revenue from contracts with customers disaggregated by type of service, which best depicts how the revenue and cash flows are affected by economic factors, and by the reportable segment to which each revenue stream relates, as well as a reconciliation of total revenue from contracts with customers to total noninterest income .

Revenue from contracts with customers is presented within noninterest income—technology products and solutions and noninterest income—

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

other in the consolidated statements of operations and comprehensive income (loss).

There were no revenues from contracts with customers attributable to our Lending segment for any of the years presented.

Year Ended December 31,

2022 2021 2020

(1) The additional goodwill recognized as of December 31, 2020 includes $ 873,358 related to the acquisition of Galileo and $ 10,239 related to the acquisition of 8 Limited.

See Note 2 for additional information.

(2) As of December 31, 2021, includes an adjustment related to the finalization of the closing net working capital calculation in April 2021 for the acquisition of Galileo.

See Note 2 for additional information.

(3) As of December 31, 2021, we had goodwill attributable to the following reportable segments:

$ 872,615 to Technology Platform and $ 25,912 to Financial Services.

As of December 31, 2020, we had goodwill attributable to the following reportable segments:

$ 873,358 to Technology Platform and $ 25,912 to Financial Services.

There were no goodwill impairment charges during the years ended December 31, 2021, 2020 and 2019.

The following is a summary of the carrying amount and estimated useful lives of our intangible assets by class as of the dates indicated:

Weighted Average Useful Life (Years)

Gross Balance

Accumulated Amortization

Net Book Value

December 31, 2021

Developed technology 8.5 $ 257,438 $ ( 49,401 ) $ 208,037

Customer-related 3.6 125,350 ( 57,083 ) 68,267

Trade names, trademarks and domain names 8.6 10,000 ( 1,901 ) 8,099

Core banking infrastructure (1)

n/a 17,100 ( 17,100 ) —

Broker-dealer license and trading rights

Financial Services

$ 36,052 $ 15,750 $ 5,889

17,391 10,642 2,433

December 31, 2020

Developed technology (2)

15,446 22,733 3,470

Customer-related (2)

2,245 5,541 244

Trade names, trademarks and domain names (2)

Total financial services

$ 71,134 $ 54,666 $ 12,036

Core banking infrastructure (1)(2)

Technology Platform

Technology services

$ 299,379 $ 191,847 $ 90,128

Broker-dealer license and trading rights (2)

Software licenses 5,522 — —

1,061 1,205 1,167

Total technology platform

$ 305,962 $ 193,052 $ 91,295

Total Revenue from Contracts with Customers

Technology services

$ 299,379 $ 191,847 $ 90,128

(1) In connection with the acquisition of Galileo during the year ended December 31, 2020, we accelerated the useful life of our existing core banking infrastructure to May 2021.

Although the intangible asset was fully amortized as of December 31, 2021, it remains in use by the Company.

(2) During the year ended December 31, 2020, the Company acquired $ 253,000 in developed technology, $ 125,000 in customer-related intangible assets and $ 10,000 in trade names, trademarks and domain names related to the acquisition of Galileo.

Other additions to developed technology, customer-related and broker-dealer license and trading rights intangible assets related to the acquisition of 8 Limited.

Amortization expense for the years ended December 31, 2021, 2020 and 2019 was $ 70,507 , $ 49,735 and $ 3,008 , respectively.

There were no abandonments or impairments during any of the years presented.

We accelerated amortization expense during 2019 related to certain partnership and other intangible assets because we determined that the costs of these

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

assets had already been recovered, which meant there was no expected future benefit as of December 31, 2019.

The acceleration of amortization expense had an immaterial impact during the period.

Estimated future amortization expense as of December 31, 2021 is as follows:

Referrals 36,052 15,750 5,889

17,391 10,642 2,433

Thereafter 59,800

Total $ 284,579

Investments in AFS Debt Securities

In the third quarter of 2021, we began investing in debt securities.

The following table presents our investments in AFS debt securities as of December 31, 2021.

We did not have any investments in debt securities as of December 31, 2020.

December 31, 2021

Amortized Cost (1)

Accrued Interest Gross Unrealized Gains Gross Unrealized Losses (2)

Investments in AFS debt securities (3) :

Treasury securities $ 103,014 $ 73 $ — $ ( 584 ) $ 102,503

Multinational securities (4)

15,446 22,733 3,470

Corporate bonds 39,894 235 — ( 480 ) 39,649

Agency TBA 7,457 13 4 ( 8 ) 7,466

Agency mortgage-backed securities 4,153 14 — ( 31 ) 4,136

Other asset-backed securities 9,610 5 — ( 91 ) 9,524

Commercial paper 9,939 — — — 9,939

Software licenses 5,522 — —

3,306 6,746 1,411

Total investments in AFS debt securities $ 195,796 $ 462 $ 4 $ ( 1,355 ) $ 194,907

Total revenue from contracts with customers

$ 377,096 $ 247,718 $ 103,331

(1) Amortized cost basis reflects the amortization of premium of $ 384 during the year ended December 31, 2021.

(2) As of December 31, 2021, we determined that our unrealized loss positions related to credit losses were immaterial.

Additionally, we do not intend to sell the securities in loss positions nor is it more likely than not that we will be required to sell the securities prior to recovery of the amortized cost basis.

See Note 1 for additional information.

Additionally, no such investments have been in a continuous unrealized loss position for more than 12 months, as we made the investments during the third quarter of 2021.

(3) Investments in AFS debt securities are recorded at fair value.

(4) As of December 31, 2021, includes sovereign foreign and supranational bonds.

(5) As of December 31, 2021, includes state and city municipal bond securities.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

The following table presents the amortized cost and fair value of our investments in AFS debt securities as of December 31, 2021 by contractual maturity.

Due Within One Year Due After One Year Through Five Years Due After Five Years Through Ten Years Due After Ten Years Total

December 31, 2021

Investments in AFS debt securities—Amortized cost:

Treasury securities $ — $ 103,014 $ — $ — $ 103,014

Multinational securities — 19,911 — — 19,911

Corporate bonds — 39,894 — — 39,894

Agency TBA — — — 7,457 7,457

Agency mortgage-backed securities — — — 4,153 4,153

Other asset-backed securities — 7,600 2,010 — 9,610

Commercial paper 9,939 — — — 9,939

Other 600 1,218 — — 1,818

Total investments in AFS debt securities $ 10,539 $ 171,637 $ 2,010 $ 11,610 $ 195,796

Investments in AFS debt securities—Fair value (1) :

Treasury securities $ — $ 102,430 $ — $ — $ 102,430

Multinational securities — 19,757 — — 19,757

Corporate bonds — 39,414 — — 39,414

Agency TBA — — — 7,453 7,453

Agency mortgage-backed securities — — — 4,122 4,122

Other asset-backed securities — 7,527 1,992 — 9,519

Commercial paper 9,939 — — — 9,939

Other Sources of Revenue

Loan origination and sales $ 605,403 $ 497,626 $ 371,323

Securitizations ( 40,031 ) ( 14,862 ) ( 70,251 )

Servicing 43,547 ( 2,281 ) ( 19,426 )

Other 3,424 4,427 2,624

Total investments in AFS debt securities $ 10,538 $ 170,340 $ 1,992 $ 11,575 $ 194,445

_____________________

(1) Presentation of fair values of our investments in AFS debt securities by contractual maturity excludes total accrued interest of $ 462 as of December 31, 2021.

The following table presents the proceeds and gross realized gains and losses from sales and maturities of our investments in debt securities during the year ended December 31, 2021.

Realized gains and losses are presented within noninterest income—other in the consolidated statements of operations and comprehensive income (loss).

There were no transfers between classifications of our investments in AFS debt securities during the year presented.

December 31, 2021

Investments in AFS debt securities

Gross realized gains included in earnings $ 44

Gross realized losses included in earnings ( 152 )

Net realized losses $ ( 108 )

Gross proceeds from sales and maturities (1)

Total other sources of revenue $ 612,343 $ 484,910 $ 284,270

Total noninterest income $ 989,439 $ 732,628 $ 387,601

_____________________

(1) Proceeds from maturities of investments in AFS debt securities during the year ended December 31, 2021 were $ 4,799 .

(1) In Financial Services, includes revenues from equity capital markets services and enterprise services.

In Technology Platform, includes payment network fees for serving as a transaction card program manager for enterprise customers that are the program marketers for separate card programs.

Contract Balances

As of December 31, 2022 and 2021, accounts receivable, net associated with revenue from contracts with customers was $ 61,226 and $ 33,748 , respectively, which were reported within other assets in the consolidated balance sheets.

The increase in contract balances during the current period includes the effect of the Technisys Merger, which contributed $ 21,614 to the balance as of December 31, 2022.

As of December 31, 2022, our loan portfolio consisted of loans held for sale, including personal loans, student loans and home loans, which are measured at fair value under the fair value option, and loans held for investment, including credit cards, and commercial and consumer banking loans, which are measured at amortized cost.

Below is a disaggregated

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

See Note 12 for unrealized gains and losses on our investments in AFS debt securities and amounts reclassified out of AOCI.

As of December 31, 2021, our loan portfolio consisted of personal loans, student loans and home loans, which are measured at fair value, and credit card loans, which are measured at amortized cost.

Below is a disaggregated presentation of our loans, inclusive of fair market value adjustments and accrued interest income, as applicable, as of the dates indicated:

Loans at fair value

Securitized student loans $ 574,328 $ 908,427

Securitized personal loans 234,576 559,743

presentation of our loans, inclusive of fair market value adjustments and accrued interest income and net of the allowance for credit losses, as applicable:

Loans held for sale

Personal loans (1)

$ 8,610,434 $ 2,289,426

Student loans (2)

4,877,177 3,450,837

Home loans 69,463 212,709

Personal loans 2,054,850 1,253,177

Total loans at fair value 5,952,972 4,859,068

Loans at amortized cost (1)

Credit card loans (2)

Total loans held for sale, at fair value 13,557,074 5,952,972

Loans held for investment (3)

209,164 115,912

Commercial loan (3)

Total loans at amortized cost 115,912 20,235

Commercial and consumer banking:

Commercial real estate 88,652 —

Commercial and industrial 7,179 —

Residential real estate and other consumer 2,962 —

Total commercial and consumer banking 98,793 —

Total loans held for investment, at amortized cost 307,957 115,912

Total loans $ 13,865,031 $ 6,068,884

_____________________

(1) See Note 1 for additional information on our loans at amortized cost as it pertains to the allowance for credit losses pursuant to ASC 326, Financial Instruments—Credit Losses (“ASC 326”).

(2) During the year ended December 31, 2021, we had originations of credit card loans of $ 380,979 and gross repayments on credit card loans of $ 261,283 , of which $ 474 were non-cash reductions to the loan balance through reward point redemptions.

During the year ended December 31, 2020, we had originations of $ 6,957 and gross repayments of $ 3,017 .

(3) During the third quarter of 2021, we issued a commercial loan that had a principal balance of $ 10,000 , all of which was repaid during the third quarter of 2021.

During the fourth quarter of 2020, we issued a commercial loan that had a principal balance of $ 16,500 and accumulated unpaid interest of $ 12 as of December 31, 2020, all of which was repaid during January 2021.

Loans Measured at Fair Value

The following table summarizes the aggregate fair value of our loans measured at fair value on a recurring basis as of the dates indicated:

Student Loans Home Loans Personal Loans Total

(1) Includes $ 663,004 and $ 234,576 of personal loans in consolidated VIEs as of December 31, 2022 and 2021, respectively.

(2) Includes $ 268,697 and $ 574,328 of student loans in consolidated VIEs as of December 31, 2022 and 2021, respectively.

(3) See Note 1 and Note 5 for additional information on our loans at amortized cost as it pertains to the allowance for credit losses.

Loans Held for Sale

The following table summarizes the aggregate fair value of our loans held for sale, for which we elected the fair value option and are, therefore, measured at fair value on a recurring basis:

Personal Loans Student Loans Home Loans Total

December 31, 2022

15 unchanged sentences

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

The following table summarizes the aggregate fair value of loans 90 days or more delinquent as of the dates indicated.

The following table summarizes the aggregate fair value of loans 90 days or more delinquent.

As delinquent personal loans and student loans are charged off after 120 days of delinquency, amounts presented below represent the fair value of loans that are 90 to 120 days delinquent.

There were no home loans that were 90 days or more delinquent as of the dates presented.

Student Loans

Personal Loans

Personal Loans Student Loans

December 31, 2022

Unpaid principal

Unpaid principal balance

$ 27,989 $ 6,435 $ 34,424

Accumulated interest

1,207 304 1,511

Cumulative fair value adjustments

2 unchanged sentences

December 31, 2021

Unpaid principal

Unpaid principal balance

$ 4,765 $ 1,589 $ 6,354

4 unchanged sentences

$ 725 $ 756 $ 1,481

The following table presents the changes in our loans measured at fair value on a recurring basis:

Student Loans

Personal Loans

Fair value as of January 1, 2020 $ 3,185,233 $ 91,695 $ 2,111,030 $ 5,387,958

Origination of loans

4,928,880 2,183,521 2,580,757 9,693,158

Principal payments

( 883,761 ) ( 2,748 ) ( 1,015,046 ) ( 1,901,555 )

Sales of loans

( 4,534,286 ) ( 2,102,101 ) ( 1,531,058 ) ( 8,167,445 )

Deconsolidation of securitizations

( 495,507 ) — ( 406,687 ) ( 902,194 )

Purchases (1)

648,153 2,070 39,975 690,198

Change in accumulated interest

1,286 21 ( 2,379 ) ( 1,072 )

Change in fair value (2)

16,461 7,231 36,328 60,020

Fair value as of December 31, 2020 $ 2,866,459 $ 179,689 $ 1,812,920 $ 4,859,068

Origination of loans 4,293,526 2,978,222 5,386,934 12,658,682

Principal payments ( 892,989 ) ( 6,184 ) ( 1,054,077 ) ( 1,953,250 )

Sales of loans ( 2,854,778 ) ( 2,935,038 ) ( 4,290,424 ) ( 10,080,240 )

Purchases (1)

44,850 1,144 405,051 451,045

Change in accumulated interest 518 49 752 1,319

Change in fair value (2)

( 6,749 ) ( 5,173 ) 28,270 16,348

Fair value as of December 31, 2021 $ 3,450,837 $ 212,709 $ 2,289,426 $ 5,952,972

_____________________

(1) Purchases reflect unpaid principal balance and relate to previously transferred loans.

Purchase activity during the years ended December 31, 2021 and 2020 included securitization clean-up calls (purchases we elect to make when the risk retention period has sunset) of $ 425,302 and $ 76,044 , respectively.

Additionally, during the years ended December 31, 2021 and 2020, the Company elected to purchase $ 17,596 and $ 606,264 , respectively, of previously sold loans.

The Company was not required to buy back these loans.

The remaining purchases during the years presented related to standard representations and warranties pursuant to our various loan sale agreements.

(2) Changes in fair value of loans are recorded in the consolidated statements of operations and comprehensive income (loss) within noninterest income—loan origination and sales for loans held on the balance sheet prior to transfer to a third party through a sale or to a VIE and within noninterest income—securitizations for loans in a consolidated VIE.

Changes in fair value are impacted by valuation assumption changes, as well as sales price execution and amount of time the loans are held prior to sale.

The estimated amount of gains included in earnings attributable to changes in instrument-specific credit risk were $ 4,143 , $ 13,896 and $ 9,501 during the years ended December 31, 2021, 2020 and 2019, respectively.

The gains attributable to instrument-specific credit risk were estimated by incorporating our current default and loss severity assumptions for the loans.

These assumptions are based on historical performance, market trends and performance expectations over the term of the underlying instrument.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

Variable Interest Entities

Consolidated VIEs

The Company consolidates certain securitization trusts in which we have a variable interest and are deemed to be the primary beneficiary.

Our consolidation policy is further discussed in Note 1.

The VIEs are SPEs with portfolio loans securing debt obligations.

The SPEs were created and designed to transfer credit and interest rate risk associated with consumer loans through the issuance of collateralized notes and trust certificates.

The Company makes standard representations and warranties to repurchase or replace qualified portfolio loans.

Aside from these representations, the holders of the asset-backed debt obligations have no recourse to the Company if the cash flows from the underlying portfolio loans securing such debt obligations are not sufficient to pay all principal and interest on the asset-backed debt obligations.

We hold a significant interest in these financing transactions through our ownership of a portion of the residual interest in certain VIEs.

In addition, in some cases, we invest in the debt obligations issued by the VIE.

Our investments in consolidated VIEs eliminate in consolidation.

The residual interest is the first VIE interest to absorb losses should the loans securing the debt obligations not provide adequate cash flows to satisfy more senior claims and is, by design, the interest that we expect to absorb the expected gains and losses of the VIE.

The Company’s exposure to credit risk in sponsoring SPEs is limited to our investment in the VIE.

VIE creditors have no recourse against our general credit.

The following table presents the assets and liabilities of consolidated VIEs that were included in our consolidated balance sheets.

The assets in the below table may only be used to settle obligations of consolidated VIEs and were in excess of those obligations as of the dates presented.

Additionally, the assets and liabilities in the table below exclude intercompany balances, which eliminate upon consolidation.

Restricted cash and restricted cash equivalents $ 53,161 $ 76,973

Loans 808,904 1,468,170

Total assets $ 862,065 $ 1,545,143

Accounts payable, accruals and other liabilities $ 388 $ 759

660,419 1,248,822

Residual interests classified as debt 93,682 118,298

Total liabilities $ 754,489 $ 1,367,879

_____________________

(1) Debt is presented net of debt issuance costs and debt premiums (discounts).

Nonconsolidated VIEs

We have created and designed personal loan and student loan trusts to transfer associated credit and interest rate risk associated with the loans through the issuance of collateralized notes and residual certificates.

We have a variable interest in the nonconsolidated loan trusts, as we own collateralized notes and residual certificates in the loan trusts that absorb variability.

We also have continuing, non-controlling involvement with the trusts as the servicer.

As servicer, we have the power to perform the activities which most impact the economic performance of the VIE, but since we hold an insignificant financial interest in the trusts, we are not the primary beneficiary.

We define an insignificant financial interest as less than 10% of the expected gains and losses of the VIE.

This financial interest represents the equity ownership interest in the loan trusts, wherein there is an obligation to absorb losses and the right to receive benefits from residual certificate ownership.

The maximum exposure to loss as a result of our involvement with the nonconsolidated VIE is limited to our investment.

There are no liquidity arrangements, guarantees or other commitments by third parties that may affect the fair value or risk of our variable interests in nonconsolidated VIEs.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

Personal Loans

We established four and one personal loan trusts during the years ended December 31, 2021 and 2020, respectively, that were not consolidated as of the corresponding balance sheet dates.

As of December 31, 2021 and 2020, we had investments in nine and nine nonconsolidated personal loan VIEs, respectively.

We did not provide financial support to any personal loan trusts beyond our initial equity investment during the years presented.

We did no t deconsolidate any personal loan VIEs during the year ended December 31, 2021.

We deconsolidated three VIEs during the year ended December 31, 2020, which were originally consolidated in 2017.

Student Loans

We established four and four student loan trusts during the years ended December 31, 2021 and 2020, respectively, that were not consolidated as of the corresponding balance sheet dates.

As of December 31, 2021 and 2020, we had investments in 24 and 20 nonconsolidated student loan VIEs, respectively.

We did not provide financial support to any student loan trusts beyond our initial equity investment during the years presented.

We did no t deconsolidate any student loan VIEs during the year ended December 31, 2021.

We consolidated one VIE during the year ended December 31, 2020 that was also deconsolidated during the year.

The following table presents the aggregate outstanding value of asset-backed bonds and residual interests owned by the Company in nonconsolidated VIEs, which were included in our consolidated balance sheets.

Personal loans $ 62,925 $ 71,115

Student loans 311,763 425,820

Securitization investments $ 374,688 $ 496,935

Transfers of Financial Assets

We regularly transfer financial assets and account for such transfers as either sales or secured borrowings depending on the facts and circumstances.

We regularly transfer financial assets and account for such transfers as either sales or secured borrowings depending on the facts and circumstances of the transfer.

When a transfer of financial assets qualifies as a sale, in many instances we have continued involvement as the servicer of those financial assets.

3 unchanged sentences

In whole loan sales, we do not have a residual financial interest in the loans, nor do we have any other power over the loans that would constrain us from recognizing a sale.

Additionally, we have no repurchase requirements related to transfers of personal loans, student loans and non-FNMA home loans other than standard origination representations and warranties, for which we record a liability based on expected repurchase obligations.

For FNMA home loans, we have customary FNMA repurchase requirements, which do not constrain sale treatment but result in a liability for the expected repurchase requirement.

Additionally, we have no repurchase requirements related to transfers of personal loans, student loans and non-GSE home loans other than standard origination representations and warranties, for which we record a liability based on expected repurchase obligations.

For GSE home loans, we have customary GSE repurchase requirements, which do not constrain sale treatment but result in a liability for the expected repurchase requirement.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

The following table summarizes the loan securitization transfers qualifying for sale accounting treatment for the years indicated.

There were no home loan securitization transfers qualifying for sale accounting treatment during any of the years presented.

The following table summarizes our personal loan and student loan securitization transfers qualifying for sale accounting treatment.

There were no loan securitization transfers qualifying for sale accounting treatment during the year ended December 31, 2022.

Year Ended December 31,

2021 2020 2019

Student loans

Fair value of consideration received and obligations settled:

Personal loans

Fair value of consideration received:

Cash $ 1,050,062 $ 316,503

6 unchanged sentences

$ 57,385 $ 45,465

Personal loans

Fair value of consideration received and obligations settled:

Student loans

Fair value of consideration received:

Cash $ 1,187,714 $ 2,015,357

1 unchanged sentence

Deconsolidation of debt (1)

— 414,261 1,464,920

Servicing assets recognized 36,948 19,903

4 unchanged sentences

_____________________

(1) For the year ended December 31, 2020, the gains from sales excluded losses from deconsolidations on personal loans and student loans of $ 6,098 and $ 8,601 , respectively.

Deconsolidation of debt reflects the impacts of previously consolidated VIEs that became deconsolidated during the year because we no longer held a significant financial interest in the underlying securitization entity, which can fluctuate from period to period.

See Note 6 for further discussion of deconsolidations.

For the year ended December 31, 2020, the gains from sales excluded losses from deconsolidations on student loans and personal loans of $ 8,601 and $ 6,098 , respectively.

For the year ended December 31, 2019, the gains from sales excluded losses from deconsolidations on personal loans of $ 38,741 .

Losses on deconsolidations are presented within noninterest income—securitizations in the consolidated statements of operations and comprehensive income (loss).

Gains and losses on deconsolidations are presented within noninterest income—securitizations in the consolidated statements of operations and comprehensive income (loss).

During the year ended December 31, 2022, we had deconsolidation of debt on personal loans of $ 70.6 million and on student loans of $ 126.0 million.

The impact on earnings from these deconsolidations was immaterial.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

The following table summarizes the whole loan sales for the years indicated:

The following table summarizes our whole loan sales:

Year Ended December 31,

2022 2021 2020

Student loans

Personal loans

Fair value of consideration received:

5 unchanged sentences

Gain from loan sales $ 106,747 $ 133,653 $ 52,109

Student loans

Fair value of consideration received:

5 unchanged sentences

Gain from loan sales $ 11,078 $ 56,838 $ 118,122

Personal loans

Fair value of consideration received:

2 unchanged sentences

Repurchase liabilities recognized ( 1,158 ) ( 3,288 ) ( 3,034 )

Total consideration received 3,387,298 1,290,583 2,344,961

Total consideration 1,070,364 3,017,819 2,191,115

Aggregate unpaid principal balance and accrued interest of loans sold 1,095,882 2,935,343 2,101,895

Gain from loan sales $ 133,653 $ 52,109 $ 87,738

The following table presents information as of the dates indicated about the unpaid principal balances of transferred loans that are not recorded in our consolidated balance sheets, but with which we have a continuing involvement through our servicing agreements:

Student Loans Home Loans Personal Loans Total

Gain (loss) from loan sales $ ( 25,518 ) $ 82,476 $ 89,220

The following table presents information about the unpaid principal balances of transferred loans that are not recorded in our consolidated balance sheets, but with which we have a continuing involvement through our servicing agreements:

Personal Loans Student Loans Home Loans Total

December 31, 2022

11 unchanged sentences

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

The following table presents additional information about the servicing cash flows received and net charge-offs related to transferred loans with which we have a continuing involvement during the years indicated:

The following table presents additional information about the servicing cash flows received and net charge-offs related to transferred loans with which we have a continuing involvement:

Year Ended December 31,

2022 2021 2020

Student loans

Personal loans

Servicing fees collected

2 unchanged sentences

107,359 102,276 197,927

Student loans

Servicing fees collected

1 unchanged sentence

Charge-offs, net of recoveries (1)

Personal Loans

34,136 24,675 16,999

Servicing fees collected

1 unchanged sentence

Charge-offs, net of recoveries

102,276 197,927 233,628

Servicing fees collected

3 unchanged sentences

_____________________

(1) Student loan and personal loan charge-offs, net of recoveries, are impacted by the timing of charge-off sales performed on behalf of the purchasers of our loans, which lower the net amount disclosed.

For both loan products, charge-off sales were meaningfully higher in 2020 relative to 2021.

Allowance for Credit Losses

We measure our allowance for credit losses on accounts receivable, which primarily relates to Galileo, and on loans measured at amortized cost, including credit card loans, under ASC 326.

Given our methods of collecting funds on servicing receivables, our historical experience of infrequent write offs, and that we have not observed meaningful changes in our counterparties’ abilities to pay, we determined that the future exposure to credit losses on servicing related receivables was immaterial.

The following table summarizes the activity in the balance of allowance for credit losses on accounts receivable and credit card loans during the years indicated:

Accounts Receivable (1)

Credit Card Loans (2)

Balance at January 1, 2020 $ — $ —

Provision for credit losses (3)

Write-offs charged against the allowance

Balance at December 31, 2020

Provision for credit losses (3)

Write-offs charged against the allowance (4)

( 1,313 ) ( 755 )

Balance at December 31, 2021

(1) Personal loan and student loan charge-offs, net of recoveries, are impacted by the timing of charge-off sales performed on behalf of the purchasers of our loans, which lower the net amount disclosed.

Loans Held for Investment

Loan Portfolio Composition and Aging

The following table presents the amortized cost basis of our credit card and commercial and consumer banking portfolios (excluding accrued interest and before the allowance for credit losses) by either current status or delinquency status:

Delinquent Loans

Current 30–59 Days 60–89 Days ≥ 90 Days (1)

Total Delinquent Loans Total Loans (2)

December 31, 2022

Credit card $ 225,165 $ 4,670 $ 3,626 $ 10,498 $ 18,794 $ 243,959

Commercial and consumer banking:

Commercial real estate 89,544 — — — — 89,544

Commercial and industrial 7,636 — 1 — 1 7,637

Residential real estate and other consumer (3)

2,966 — — — — 2,966

Total commercial and consumer banking 100,146 — 1 — 1 100,147

Total loans $ 325,311 $ 4,670 $ 3,627 $ 10,498 $ 18,795 $ 344,106

December 31, 2021

Credit card $ 115,356 $ 1,893 $ 1,683 $ 2,658 $ 6,234 $ 121,590

_____________________

(1) Accounts receivable balances, net of allowance for credit losses, are presented within other assets in the consolidated balance sheets.

We established an allowance for credit losses on accounts receivable subsequent to our acquisition of Galileo in the second quarter of 2020.

Certain of our historical accounts receivable balances did not have any write-offs.

(2) Credit card loans measured at amortized cost, net of allowance for credit losses, are presented within loans in the consolidated balance sheets.

We launched the SoFi Credit Card in the third quarter of 2020, which was expanded to a broader market in the fourth quarter of 2020.

(3) Provision for credit losses on accounts receivable and credit card loans are presented within noninterest expense—general and administrative and noninterest expense—provision for credit losses , respectively, in the consolidated statements of operations and comprehensive income (loss).

There were no recoveries of credit card losses during the years ended December 31, 2021 and 2020.

(4) The increase in accounts receivable write-offs charged against the allowance during the year ended December 31, 2021 was primarily attributable to three accounts that were deemed uncollectible.

(1) All of the credit cards ≥ 90 days past due continued to accrue interest.

As of the dates indicated, there were no credit cards on nonaccrual status.

As of December 31, 2022, commercial and consumer banking loans on nonaccrual status were immaterial, and there were no loans that were ≥ 90 days past due.

(2) For credit card, the balance is presented before allowance for credit losses of $ 39,110 and $ 7,037 as of December 31, 2022 and 2021, respectively, and accrued interest of $ 4,315 and $ 1,359 , respectively.

For commercial and consumer banking, the balance is presented before allowance for credit losses of $ 1,678 and accrued interest of $ 324 as of December 31, 2022.

(3) Primarily includes residential real estate loans acquired in the Bank Merger, for which we did not elect the fair value option.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

Fair Value Measurements

The following tables summarize, by level within the fair value hierarchy, the carrying amounts and estimated fair values of our assets and liabilities (i) measured at fair value on a recurring basis, (ii) measured at fair value on a nonrecurring basis, or (iii) disclosed but not carried at fair value in the consolidated balance sheets as of the dates presented.

December 31, 2021

Carrying Value Level 1 Level 2 Level 3 Total

Cash and cash equivalents (1)

$ 494,711 $ 494,711 $ — $ — $ 494,711

Restricted cash and restricted cash equivalents (1)

Credit Quality Indicators

The following table presents the amortized cost basis of our credit card portfolio (excluding accrued interest and before the allowance for credit losses) based on FICO scores, which are obtained at origination of the account and are refreshed monthly thereafter.

The pools estimate the likelihood of borrowers with similar FICO scores to pay credit obligations based on aggregate credit performance data.

FICO 2022 2021

≥ 800 $ 14,421 $ 10,016

Investments in AFS debt securities (2)(4)

780 – 799 11,327 8,624

Student loans (2)

760 – 779 12,179 9,976

Home loans (2)

740 – 759 14,501 13,581

Personal loans (2)

720 – 739 19,343 18,358

Credit card loans (1)

700 – 719 26,239 22,579

Servicing rights (2)

680 – 699 31,543 21,736

Asset-backed bonds (2)(5)

660 – 679 31,958 14,044

Residual investments (2)(5)

640 – 659 25,959 1,969

Non-securitization investments – ETFs (2)(6)

620 – 639 15,566 707

Non-securitization investments – other (3)

600 – 619 8,968 —

Third party warrants (2)(7)

≤ 599 31,955 —

Derivative assets (2)(8)(9)

Total credit card $ 243,959 $ 121,590

Commercial and Consumer Banking

We analyze loans in our commercial and consumer banking portfolio by classification based on their associated credit risk, and perform an analysis on an ongoing basis as new information is obtained.

Risk rating classifications are further described below.

Loans with a lower expectation of credit losses are classified as Pass, while loans with a higher expectation of credit losses are classified as Substandard.

• Pass — Loans that management believes will fully repay in accordance with the contractual loan terms.

• Watch — Loans that management believes will fully repay in accordance with the contractual loan terms, but for which certain credit attributes have changed from origination and warrant further monitoring.

• Special mention — Loans with a potential weakness that deserves management’s close attention.

If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or our credit position at some future date.

• Substandard — Loans that are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any.

Loans so classified have a well-defined weakness or weaknesses that jeopardize the full repayment.

They are characterized by the distinct possibility that we will sustain some loss if the deficiencies are not corrected.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

The following table presents the amortized cost basis of our commercial and consumer banking portfolio (excluding accrued interest and before the allowance for credit losses) by origination year and credit quality indicator:

Term Loans by Origination Year

December 31, 2022 2022 2021 2020 2019 2018 Prior Total Term Loans Revolving Loans

Commercial real estate

Pass $ 34,550 $ 5,756 $ 6,312 $ 10,244 $ 6,541 $ 13,515 $ 76,918 $ 199

Watch 4,653 1,684 — 226 1,507 1,399 9,469 —

Special mention — — — 678 1,202 406 2,286 —

Substandard — — — — — 672 672 —

Total commercial real estate $ 39,203 $ 7,440 $ 6,312 $ 11,148 $ 9,250 $ 15,992 $ 89,345 $ 199

Commercial and industrial

Pass $ — $ 3 $ 101 $ — $ 79 $ 5,258 $ 5,441 $ 220

Watch — — — 132 — 263 395 24

Substandard — — — 221 526 810 1,557 —

Total commercial and industrial $ — $ 3 $ 101 $ 353 $ 605 $ 6,331 $ 7,393 $ 244

Residential real estate and other consumer

Pass $ — $ — $ — $ — $ — $ 2,850 $ 2,850 $ 73

Watch — — — — — 41 41 2

Total residential real estate and other consumer $ — $ — $ — $ — $ — $ 2,891 $ 2,891 $ 75

Total commercial and consumer banking

$ 39,203 $ 7,443 $ 6,413 $ 11,501 $ 9,855 $ 25,214 $ 99,629 $ 518

Purchase price earn-out (2)(10)

Allowance for Credit Losses

Our allowance for credit losses represents our current estimate of expected credit losses over the remaining contractual life of certain financial assets including loans measured at amortized cost, including credit cards as well as commercial and consumer banking loans acquired in the Bank Merger, which relate to our Financial Services segment, and accounts receivables primarily related to our Technology Platform segment.

In estimating expected credit losses for credit cards, we segment loans based on credit quality indicators and reassess our pools periodically to confirm that all loans within each pool continue to share similar risk characteristics.

We establish an allowance within each pool utilizing a proprietary risk model that relies on assumptions such as average annual percentage rate, payment rate, utilization, delinquency status and default probability.

The model may then be adjusted for current conditions and reasonable and supportable forecasts of future conditions, including economic conditions.

We apply the aforementioned assumptions to the drawn balance of credit cards within each pool to estimate the lifetime expected credit losses within each pool, which are then aggregated to determine the allowance for credit losses.

We further consider an evaluation of overall portfolio credit quality based on indicators such as changes in our credit decisioning process, underwriting and collection management policies;

the effects of external factors, such as regulatory requirements;

general economic conditions;

and inherent uncertainties in applying the methodology.

When a credit card balance is charged off, we record a reduction to the allowance and the credit card balance.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

The following table presents changes in the Company’s allowance for credit losses:

Credit Card (1)

Commercial and Consumer Banking (1)

Accounts Receivable (1)

Balance at January 1, 2021 $ 219 $ — $ 562

Provision for credit losses (2)

7,573 — 3,043

Interest rate lock commitments (2)(11)

Write-offs charged against the allowance (3)

( 755 ) — ( 1,313 )

Student loan commitments (2)(11)

Balance at December 31, 2021

$ 7,037 $ — $ 2,292

Interest rate caps (2)(9)

Provision for credit losses (2)

53,030 1,302 586

Total assets $ 7,600,272 $ 899,758 $ 324,678 $ 6,378,336 $ 7,602,772

Allowance for PCD loans (4)

Write-offs charged against the allowance (3)

( 20,957 ) ( 6 ) ( 93 )

Residual interests classified as debt (2)

Balance at December 31, 2022

$ 39,110 $ 1,678 $ 2,785

Derivative liabilities (2)(8)(9)

_____________________

Total liabilities $ 4,042,529 $ 1,240,756 $ 2,807,921 $ 93,682 $ 4,142,359

(1) Credit cards and commercial and consumer banking loans measured at amortized cost, net of allowance for credit losses, are presented within loans held for investment in the consolidated balance sheets.

Accounts receivable balances, net of allowance for credit losses, are presented within other assets in the consolidated balance sheets.

(2) The provision for credit losses on credit cards and commercial and consumer banking loans is presented within noninterest expense—provision for credit losses.

There were immaterial recoveries of amounts previously reserved related to credit cards and commercial and consumer banking loans.

The provision for credit losses on accounts receivable is presented within noninterest expense—general and administrative in the consolidated statements of operations and comprehensive income (loss).

During the years ended December 31, 2022 and 2021, recoveries of amounts previously reserved related to accounts receivable were $ 2,912 and $ 776 , respectively.

(3) The increase in credit card write-offs charged against the allowance during the year ended December 31, 2022 relative to 2021 was commensurate with our increased loan portfolio combined with elevated loss rates.

(4) In connection with the Bank Merger, we obtained purchased credit deteriorated (“PCD”) loans, for which we measured an allowance, with a corresponding increase to the amortized cost basis as of the acquisition date.

Therefore, recognition of the initial allowance for credit losses did not impact earnings.

Accrued interest receivables written off by reversing interest income during the year ended December 31, 2022 were $ 4,650 .

Accrued interest receivables written off during the year ended December 31, 2021 were immaterial .

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

Investment Securities

Investments in AFS Debt Securities

The following table presents our investments in AFS debt securities:

December 31, 2022

Carrying Value Level 1 Level 2 Level 3 Total

Cash and cash equivalents (1)

Amortized Cost

Accrued Interest Gross Unrealized Gains Gross Unrealized Losses (1)

Treasury securities $ 121,282 $ 217 $ — $ ( 3,510 ) $ 117,989

Multinational securities (2)

19,658 109 — ( 724 ) 19,043

Restricted cash and restricted cash equivalents (1)

Corporate bonds 41,890 257 — ( 2,644 ) 39,503

Agency mortgage-backed securities 8,899 22 — ( 991 ) 7,930

Other asset-backed securities 9,556 5 — ( 514 ) 9,047

2,133 21 — ( 228 ) 1,926

Student loans (2)

Total investments in AFS debt securities $ 203,418 $ 631 $ — $ ( 8,611 ) $ 195,438

December 31, 2021

Amortized Cost Accrued Interest Gross Unrealized Gains Gross Unrealized Losses (1)

Treasury securities 103,014 73 — ( 584 ) 102,503

Multinational securities (2)

19,911 109 — ( 154 ) 19,866

Home loans (2)

Corporate bonds 39,894 235 — ( 480 ) 39,649

Agency TBA (4)

7,457 13 4 ( 8 ) 7,466

Personal loans (2)

Agency mortgage-backed securities 4,153 14 — ( 31 ) 4,136

Other asset-backed securities 9,610 5 — ( 91 ) 9,524

Commercial paper 9,939 — — — 9,939

1,818 13 — ( 7 ) 1,824

Credit card loans (1)

Total investments in AFS debt securities $ 195,796 $ 462 $ 4 $ ( 1,355 ) $ 194,907

_____________________

Commercial loan (1)

(1) As of December 31, 2022 and 2021, we determined that our unrealized loss positions related to credit losses were immaterial.

Additionally, we do not intend to sell the securities in loss positions nor is it more likely than not that we will be required to sell the securities prior to recovery of the amortized cost basis.

(2) Includes sovereign foreign and supranational bonds.

(3) Includes state and city municipal bond securities.

(4) Represented to-be-announced (“TBA”) securities, which were securities that were delivered under the purchase contract at a later date when the underlying security was issued.

The December 31, 2021 balance was paid in cash during 2022.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

The following table presents information about our investments in AFS debt securities with gross unrealized losses and the length of time that individual securities have been in a continuous unrealized loss position as of December 31, 2022.

There were no securities in a gross unrealized loss position for 12 months or more as of December 31, 2021.

December 31, 2022

Less than 12 Months 12 Months or Longer Total

Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses

Treasury securities $ 27,759 $ ( 1,171 ) $ 90,230 $ ( 2,339 ) $ 117,989 $ ( 3,510 )

Multinational securities — — 19,043 ( 724 ) 19,043 ( 724 )

Corporate bonds 4,480 ( 313 ) 35,023 ( 2,331 ) 39,503 ( 2,644 )

Agency mortgage-backed securities 6,448 ( 814 ) 1,482 ( 177 ) 7,930 ( 991 )

Other asset-backed securities — — 9,047 ( 514 ) 9,047 ( 514 )

Other 745 ( 200 ) 1,181 ( 28 ) 1,926 ( 228 )

Total investments in AFS debt securities $ 39,432 $ ( 2,498 ) $ 156,006 $ ( 6,113 ) $ 195,438 $ ( 8,611 )

The following table presents the amortized cost and fair value of our investments in AFS debt securities by contractual maturity:

December 31, 2022 Due Within One Year Due After One Year Through Five Years Due After Five Years Through Ten Years Due After Ten Years Total

Investments in AFS debt securities—Amortized cost:

Treasury securities $ 81,705 $ 39,577 $ — $ — $ 121,282

Multinational securities 10,916 8,742 — — 19,658

Corporate bonds 2,763 35,787 3,340 — 41,890

Agency mortgage-backed securities — 195 842 7,862 8,899

Other asset-backed securities — 7,600 1,956 — 9,556

Other 1,197 — — 936 2,133

Total investments in AFS debt securities $ 96,581 $ 91,901 $ 6,138 $ 8,798 $ 203,418

Weighted average yield for investments in AFS debt securities (1)

( 1.63 ) % ( 4.72 ) % ( 4.59 ) % ( 12.85 ) % ( 3.60 ) %

Servicing rights (2)

Investments in AFS debt securities—Fair value (2) :

Treasury securities $ 79,989 $ 37,783 $ — $ — $ 117,772

Multinational securities 10,590 8,344 — — 18,934

Corporate bonds 2,687 33,486 3,073 — 39,246

Agency mortgage-backed securities — 182 767 6,959 7,908

Other asset-backed securities — 7,179 1,863 — 9,042

Other 1,168 — — 737 1,905

Total investments in AFS debt securities $ 94,434 $ 86,974 $ 5,703 $ 7,696 $ 194,807

_____________________

Asset-backed bonds (2)(5)

(1) The weighted average yield represents the effective yield for the investment securities and is computed based on the amortized cost of each security as of December 31, 2022.

(2) Presentation of fair values of our investments in AFS debt securities by contractual maturity excludes total accrued interest of $ 631 and $ 462 as of December 31, 2022 and 2021, respectively.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

Gross realized gains and losses on our investments in AFS debt securities were immaterial during the years ended December 31, 2022 and 2021, and there were no transfers between classifications of our investments in AFS debt securities.

See Note 13 for unrealized gains and losses on our investments in AFS debt securities and amounts reclassified out of AOCI.

Securitization Investments

The following table presents the aggregate outstanding value of asset-backed bonds and residual interests owned by the Company in nonconsolidated VIEs, which are presented within investment securities in the consolidated balance sheets:

Personal loans $ 20,172 $ 62,925

Student loans 181,159 311,763

Securitization investments $ 201,331 $ 374,688

Securitization and Variable Interest Entities

Consolidated VIEs

We consolidate certain securitization trusts in which we have a variable interest and are deemed to be the primary beneficiary.

Our consolidation policy is further discussed in Note 1.

The VIEs are SPEs with portfolio loans securing debt obligations.

The SPEs were created and designed to transfer credit and interest rate risk associated with consumer loans through the issuance of collateralized notes and trust certificates.

We make standard representations and warranties to repurchase or replace qualified portfolio loans.

We hold a significant interest in these financing transactions through our ownership of a portion of the residual interest in certain VIEs.

In addition, in some cases, we invest in the debt obligations issued by the VIE.

Our investments in consolidated VIEs eliminate in consolidation.

The residual interest is the first VIE interest to absorb losses should the loans securing the debt obligations not provide adequate cash flows to satisfy more senior claims and is the interest that we expect to absorb the expected gains and losses of the VIE.

Our exposure to credit risk in sponsoring SPEs is limited to our investment in the VIE.

VIE creditors have no recourse against our general credit.

As of December 31, 2022 and 2021, we had 6 and 13 consolidated VIEs, respectively, on our consolidated balance sheets.

During the year ended December 31, 2022, we exercised securitization clean up calls related to 9 consolidated VIEs, and established 2 consolidated VIEs.

The assets of consolidated VIEs that were included in our consolidated balance sheets may only be used to settle obligations of consolidated VIEs and were in excess of those obligations as of December 31, 2022 and 2021.

Intercompany balances are eliminated upon consolidation.

Nonconsolidated VIEs

We have a variable interest in the nonconsolidated loan trusts, as we own collateralized notes and residual certificates in the loan trusts that absorb variability.

We also have continuing, non-controlling involvement with the trusts as the servicer.

The maximum exposure to loss as a result of our involvement with the nonconsolidated VIEs is limited to our investment.

We did not provide financial support to any nonconsolidated VIEs beyond our initial equity investment.

There are no liquidity arrangements, guarantees or other commitments by third parties that may affect the fair value or risk of our variable interests in nonconsolidated VIEs.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

As of December 31, 2022 and 2021, we had investments in 23 and 33 nonconsolidated VIEs, respectively.

During the year ended December 31, 2022, we exercised securitization clean up calls on 9 nonconsolidated VIEs and collapsed the associated trusts, as well as consolidated 1 previously nonconsolidated VIE.

Goodwill and Intangible Assets

A rollforward of our goodwill balance is presented below:

Year Ended December 31,

Beginning balance

$ 898,527 $ 899,270

Residual investments (2)(5)

accumulated impairment

Beginning balance, net

898,527 899,270

Non-securitization investments – ETFs (2)(6)

Additional goodwill recognized (1)

Other adjustments (2)

Ending balance (3)

$ 1,622,991 $ 898,527

Non-securitization investments – other (3)

_____________________

Interest rate lock commitments (2)(11)

(1) For the year ended December 31, 2022, includes $ 713,217 related to the Technisys Merger (inclusive of measurement period adjustments and an adjustment related to the finalization of the closing net working capital calculation) and $ 11,247 related to the Bank Merger.

(2) For the year ended December 31, 2021, includes an adjustment related to the finalization of the closing net working capital calculation in April 2021 for the acquisition of Galileo, which closed in 2020.

(3) As of December 31, 2022 and 2021, we had goodwill attributable to the following reportable segments:

$ 1,585,832 and $ 872,615 , respectively, to Technology Platform and $ 37,159 and $ 25,912 , respectively, to Financial Services.

There were no goodwill impairment charges during the years ended December 31, 2022, 2021 and 2020.

Intangible Assets

The following is a summary of the carrying amount and estimated useful lives of our intangible assets by class:

Weighted Average Useful Life (Years)

Gross Balance

Accumulated Amortization

Net Book Value

December 31, 2022

Developed technology (1)

8.7 $ 444,438 $ ( 97,202 ) $ 347,236

Total assets $ 6,872,880 $ 1,330,278 $ 357,411 $ 5,185,191 $ 6,872,880

Customer-related (1)

3.9 167,350 ( 99,264 ) 68,086

Residual interests classified as debt (2)

Trade names, trademarks and domain names (1)

8.7 20,060 ( 4,028 ) 16,032

Warrant liabilities – Series H warrants (2)(12)

Core banking infrastructure (2)

n/a 17,100 ( 17,100 ) —

Capitalized software development costs (3)

4.0 10,532 ( 737 ) 9,795

Derivative liabilities (2)(8)(9)

Core deposits (1)

7.3 1,000 ( 126 ) 874

ETF short positions (2)(6)

Broker-dealer license and trading rights

5.7 250 ( 118 ) 132

Total liabilities $ 4,965,378 $ 7,249 $ 4,852,605 $ 158,257 $ 5,018,111

$ 660,730 $ ( 218,575 ) $ 442,155

(1) Disclosed but not carried at fair value.

The carrying value of our debt is net of unamortized discounts and debt issuance costs.

The fair value of our convertible notes issued in October 2021 was classified as Level 1, as it was based on an observable market quote.

The fair values of our warehouse facility debt, revolving credit facility debt, financing arrangements assumed in the Galileo acquisition and credit card loans were based on market factors and credit factors specific to these financial instruments.

The fair value of our securitization debt was valued using a discounted cash flow model, with key inputs relating to the underlying contractual coupons, terms, discount rate and expectations for defaults and prepayments.

The carrying amounts of our cash and cash equivalents and restricted cash and restricted cash equivalents approximate their fair values due to the short-term maturities and highly liquid nature of these accounts.

The fair value of our single commercial loan as of December 31, 2020 was also determined to approximate its carrying value, as the loan was issued in the fourth quarter of 2020, was short-term in nature, and was repaid in full in January 2021.

(2) Measured at fair value on a recurring basis.

(3) Measured at fair value on a nonrecurring basis.

(4) Investments in AFS debt securities as of December 31, 2021 were classified as Level 1 or Level 2.

The Level 1 investments utilize quoted prices in actively traded markets.

The Level 2 investments rely upon observable inputs other than quoted prices, dealer quotes in markets that are not active and implied pricing derived from new issuances of similar securities.

See Note 1 and Note 4 for additional information.

(5) These assets represent the carrying value of our holdings in VIEs wherein we were not deemed the primary beneficiary.

As we do not provide financial support beyond our initial equity investment, our maximum exposure to loss as a result of our involvement with nonconsolidated VIEs is limited to the investment amount.

See Note 6 for additional information.

(6) ETFs and ETF short positions classified as Level 1 are based on utilizing quoted prices in actively traded markets.

The short positions serve as an economic hedge to our non-securitization investments in ETFs.

(7) Third party warrants were recorded during the fourth quarter of 2021, and there were no subsequent adjustments from their initial value.

The key unobservable assumption used in the fair value measurement of the third party warrants is the price of the stock underlying the warrants.

The fair value is measured as the difference between the stock price and the strike price of the warrants.

As the strike price is insignificant, we concluded that the impact of time value on the fair value measure was immaterial.

(8) For certain derivative instruments for which an enforceable master netting agreement exists, we elected to net derivative assets and derivative liabilities by counterparty.

See Note 1 for additional information.

(9) Derivative liabilities classified as Level 1 are based on broker quotes in active markets and represent economic hedges of loan fair values.

Interest rate swaps and interest rate caps are classified as Level 2, because these financial instruments do not trade in active markets with observable prices, but rely on

December 31, 2021

Developed technology 8.5 $ 257,438 $ ( 49,401 ) $ 208,037

Customer-related 3.6 125,350 ( 57,083 ) 68,267

Core banking infrastructure

n/a 17,100 ( 17,100 ) —

Trade names, trademarks and domain names 8.6 10,000 ( 1,901 ) 8,099

Broker-dealer license and trading rights

5.7 250 ( 74 ) 176

$ 410,138 $ ( 125,559 ) $ 284,579

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

observable inputs other than quoted prices.

Interest rate swaps are valued using the three-month LIBOR swap yield curve and interest rate caps are valued using a SOFR rate curve and the implied volatilities suggested by the SOFR rate curve, which are all observable inputs from active markets.

(10) The purchase price earn-out provision is classified as Level 3 because of our reliance on unobservable inputs, such as conditional prepayment rates, annual default rates and discount rates.

(11) IRLCs and student loan commitments are classified as Level 3 because of our reliance on assumed loan funding probabilities.

The assumed probabilities are based on our internal historical experience with home loans and student loans similar to those in the funding pipelines on the measurement date.

(12) In conjunction with the Closing of the Business Combination, we measured the final fair value of the Series H warrants and subsequently reclassified them into permanent equity.

Therefore, we did not measure the Series H warrants at fair value on an ongoing basis, subsequent to May 28, 2021.

See Note 11 for additional information on our historical Series H warrant liabilities, including inputs to the valuation.

The following key unobservable assumptions were used in the fair value measurement of our loans as of the dates indicated:

December 31, 2021 December 31, 2020

Range Weighted Average Range Weighted Average

Student loans

Conditional prepayment rate 16.5 % – 26.3 %

_____________________

Annual default rate 0.2 % – 4.2 %

0.4 % 0.2 % – 4.9 %

Discount rate 1.9 % – 7.1 %

2.9 % 1.1 % – 7.1 %

Conditional prepayment rate 4.8 % – 16.4 %

(1) During the year ended December 31, 2022, the Company acquired $ 187,000 in developed technology, $ 42,000 in customer-related intangible assets and $ 10,000 in trade names, trademarks and domain names related to the acquisition of Technisys.

Additionally, the Company acquired $ 1,000 of deposits related to the acquisition of Golden Pacific Bank.

(2) Although the core banking infrastructure intangible asset was fully amortized as of December 31, 2022, it remains in use by the Company.

(3) Includes capitalized costs related to software products to be sold, leased or marketed within our technology products and solutions arrangements.

During the year ended December 31, 2022, total amortization expense related to capitalized software was $ 737 , and capitalized share-based compensation related to capitalized software development costs was immaterial.

For the years ended December 31, 2022, 2021 and 2020, amortization expense associated with intangible assets was $ 93,016 , $ 70,507 and $ 49,735 , respectively.

There were no abandonments or impairments during any of the years presented.

Estimated future amortization expense associated with intangible assets as of December 31, 2022 is as follows:

2023 $ 98,566

Annual default rate 0.1 % – 0.2 %

Thereafter 96,312

Total $ 442,155

Property, Equipment, Software and Leases

Property, Equipment and Software

The table below presents our major classes of depreciable and amortizable assets by function:

Balance Accumulated Depreciation/Amortization Carrying

December 31, 2022

$ 172,101 $ ( 54,516 ) $ 117,585

Discount rate 2.5 % – 13.0 %

Leasehold improvements 40,257 ( 17,145 ) 23,112

Computer hardware 21,265 ( 13,736 ) 7,529

Furniture and fixtures 18,808 ( 10,122 ) 8,686

Finance lease ROU assets (2)

15,100 ( 5,033 ) 10,067

Personal loans

Conditional prepayment rate 18.4 % – 37.7 %

Building and land 3,192 ( 67 ) 3,125

Total $ 270,723 $ ( 100,619 ) $ 170,104

December 31, 2021

$ 75,632 $ ( 22,996 ) $ 52,636

Annual default rate 4.2 % – 30.0 %

Leasehold improvements 39,726 ( 12,233 ) 27,493

Furniture and fixtures 18,326 ( 7,748 ) 10,578

Computer hardware 16,864 ( 8,583 ) 8,281

Finance lease ROU assets (2)

15,100 ( 2,876 ) 12,224

Discount rate 3.9 % – 7.0 %

Construction in progress 661 — 661

Total $ 166,309 $ ( 54,436 ) $ 111,873

_____________________

The key assumptions included in the above table are defined as follows:

• Conditional prepayment rate — The monthly annualized proportion of the principal of a pool of loans that is assumed to be paid off prematurely in each period.

An increase in the conditional prepayment rate, in isolation, would result in a decrease in a fair value measurement.

The weighted average assumption was weighted based on relative fair value.

• Annual default rate — The annualized rate of borrowers who do not make loan payments on time.

An increase in the annual default rate, in isolation, would result in a decrease in a fair value measurement.

The weighted average assumption was weighted based on relative fair value.

• Discount rate — The weighted average rate at which the expected cash flows are discounted to arrive at the net present value of the loans.

An increase in the discount rate, in isolation, would result in a decrease in a fair value measurement.

The weighted average assumption was weighted based on relative fair value.

See Note 5 for additional loan fair value disclosures.

Servicing Rights

Servicing rights for student loans and personal loans do not trade in an active market with readily observable prices.

Similarly, home loan servicing rights infrequently trade in an active market.

At the time of the underlying loan sale or the assumption of servicing rights, the fair value of servicing rights is determined using a discounted cash flow methodology based on observable and unobservable inputs.

Management classifies servicing rights as Level 3 due to the use of significant unobservable inputs in the fair value measurement.

(1) Software primarily includes internally-developed software related to significant developments and enhancements for our products.

During the years ended December 31, 2022 and 2021, we capitalized $ 22,577 and $ 7,776 , respectively, of share-based compensation related to internally-developed software, and recognized associated amortization expense of $ 6,223 and $ 792 , respectively.

(2) Finance lease ROU assets include our rights to certain physical signage within SoFi Stadium.

See below for additional information on our leases.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

The following key unobservable inputs were used in the fair value measurement of our classes of servicing rights as of the dates presented:

December 31, 2021 December 31, 2020

Range Weighted Average Range Weighted Average

Student loans

Market servicing costs 0.1 % – 0.2 %

0.1 % 0.1 % – 0.2 %

Conditional prepayment rate 15.2 % – 25.6 %

20.4 % 13.8 % – 24.7 %

Annual default rate 0.2 % – 4.3 %

0.4 % 0.2 % – 4.8 %

Discount rate 7.3 % – 7.3 %

For the years ended December 31, 2022, 2021 and 2020, total depreciation and amortization expense associated with property, equipment and software, inclusive of the amortization of capitalized share-based compensation, was $ 59,081 , $ 31,061 and $ 20,097 , respectively.

For the years ended December 31, 2022, 2021 and 2020, we recognized no property, equipment and software abandonment and there were no impairments recognized.

We had immaterial losses on disposals during the years ended December 31, 2022 and 2021.

We primarily lease our office premises under multi-year, non-cancelable operating leases.

Our operating leases have terms expiring from 2023 to 2040, exclusive of renewal option periods.

Our office leases contain renewal option periods ranging from one to ten years from the expiration dates.

These options were not recognized as part of our ROU assets and operating lease liabilities, as we did not conclude at the commencement date of the leases that we were reasonably certain to exercise these options.

However, in our normal course of business, we expect our office leases to be renewed, amended or replaced by other leases.

Our finance leases expire in 2040.

Our operating and finance leases include leases from our September 2019 agreements associated with being the named sponsor of the LA Stadium and Entertainment District at Hollywood Park in Inglewood, California (“SoFi Stadium”), which includes the stadium itself, a performance venue and a future shopping district.

Operating leases that commenced in September 2020 included our rights to use two multi-purpose stadium suites, for which we elected the practical expedient to not bifurcate the lease component from the non-lease components, and our rights to certain event space within the stadium and performance venue on a rent-free basis, for which we applied the short-term lease exemption practical expedient.

Finance leases that commenced in September 2020 included our rights to certain physical signage within the stadium.

The agreement associated with the shopping district is currently expected to commence during 2023.

We bifurcated lease components from non-lease components of certain of the arrangements, the latter of which represent sponsorship and advertising opportunities rather than the rights to physical assets that we control.

We recognize the non-lease components within noninterest expense—sales and marketing in the consolidated statements of operations and comprehensive income (loss).

The components of lease expense and supplemental cash flow and non-cash information related to our leases were as follows.

Year Ended December 31,

2022 2021 2020

Market servicing costs 0.1 % – 0.1 %

Operating lease cost

$ 20,805 $ 20,188 $ 17,371

Conditional prepayment rate 10.0 % – 16.4 %

Finance lease cost – amortization of ROU assets

2,157 2,157 719

Annual default rate 0.1 % – 0.2 %

Finance lease cost – interest expense on lease liabilities

Short-term lease cost

2,031 1,335 463

Discount rate 7.5 % – 7.5 %

Variable lease cost (1)

3,483 3,979 2,382

Personal loans

Market servicing costs 0.2 % – 1.1 %

Sublease income (2)

— ( 717 ) ( 820 )

Conditional prepayment rate 22.5 % – 41.4 %

Total lease cost

$ 28,945 $ 27,427 $ 20,282

Annual default rate 3.2 % – 7.0 %

Cash paid for amounts included in the measurement of lease liabilities

Operating cash outflows from operating leases

$ 21,682 $ 19,811 $ 17,444

Discount rate 7.3 % – 7.3 %

Operating cash outflows from finance leases

Financing cash outflows from finance leases

Supplemental non-cash information

Non-cash operating lease ROU assets obtained in exchange for lease liabilities (3)

$ ( 3,885 ) $ 12,734 $ 26,496

The key assumptions included in the above table are defined as follows:

• Market servicing costs — The fee a willing market participant, which we validate through actual third-party bids for our servicing, would require for the servicing of student loans, home loans and personal loans with similar characteristics as those in our serviced portfolio.

An increase in the market servicing cost, in isolation, would result in a decrease in a fair value measurement.

The weighted average assumption was weighted based on relative fair value.

• Conditional prepayment rate — The monthly annualized proportion of the principal of a pool of loans that is assumed to be paid off prematurely in each period.

An increase in the conditional prepayment rate, in isolation, would result in a decrease in a fair value measurement.

The weighted average assumption was weighted based on relative fair value.

• Annual default rate — The annualized rate of default within the total serviced loan balance.

An increase in the annual default rate, in isolation, would result in a decrease in a fair value measurement.

The weighted average assumption was weighted based on relative fair value.

• Discount rate — The weighted average rate at which the expected cash flows are discounted to arrive at the net present value of the servicing rights.

An increase in the discount rate, in isolation, would result in a decrease in a fair value measurement.

The weighted average assumption was weighted based on relative fair value.

Non-cash finance lease ROU assets obtained in exchange for new finance lease liabilities

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

The following table presents the estimated decrease to the fair value of our servicing rights as of the dates indicated if the key assumptions had each of the below adverse changes:

Market servicing costs

2.5 basis points increase $ ( 10,822 ) $ ( 10,472 )

5.0 basis points increase ( 21,644 ) ( 20,944 )

Conditional prepayment rate

10% increase $ ( 6,260 ) $ ( 5,430 )

20% increase ( 12,031 ) ( 10,230 )

Annual default rate

10% increase $ ( 205 ) $ ( 336 )

20% increase ( 408 ) ( 681 )

Discount rate

100 basis points increase $ ( 3,782 ) $ ( 2,986 )

200 basis points increase ( 7,349 ) ( 5,820 )

The sensitivity calculations above are hypothetical and should not be considered to be predictive of future performance.

The effect on fair value of a variation in assumptions generally cannot be determined because the relationship of the change in assumptions to the fair value may not be linear.

Additionally, the effect of an adverse variation in a particular assumption on the fair value of our servicing rights is calculated while holding the other assumptions constant.

In reality, changes in one factor may lead to changes in other factors, which could impact the above hypothetical effects.

The following table presents the changes in the Company’s servicing rights, which are measured at fair value on a recurring basis:

Student Loans Home Loans Personal Loans Total

Fair value as of December 31, 2019 $ 138,582 $ 13,181 $ 49,855 $ 201,618

Recognition of servicing from transfers of financial assets 45,637 20,440 10,515 76,592

Derecognition of servicing via loan purchases ( 12,924 ) — ( 934 ) ( 13,858 )

Change in valuation inputs or other assumptions ( 20,168 ) ( 5,056 ) 7,765 ( 17,459 )

Realization of expected cash flows and other changes ( 50,490 ) ( 4,651 ) ( 42,155 ) ( 97,296 )

Fair value as of December 31, 2020 $ 100,637 $ 23,914 $ 25,046 $ 149,597

Recognition of servicing from transfers of financial assets 52,474 31,294 27,814 111,582

Servicing rights assumed from third parties — — 370 370

Derecognition of servicing via loan purchases ( 392 ) — ( 660 ) ( 1,052 )

Change in valuation inputs or other assumptions ( 16,197 ) 4,300 9,246 ( 2,651 )

Realization of expected cash flows and other changes ( 46,519 ) ( 8,975 ) ( 34,093 ) ( 89,587 )

Fair value as of December 31, 2021 $ 90,003 $ 50,533 $ 27,723 $ 168,259

SoFi Technologies, Inc.

1 unchanged sentence

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

Asset-Backed Bonds

The fair value of asset-backed bonds is determined using a discounted cash flow methodology.

Management classifies asset-backed bonds as Level 2 due to the use of quoted prices for similar assets in markets that are not active, as well as certain factors specific to us.

The following key inputs were used in the fair value measurement of our asset-backed bonds as of the dates indicated:

Discount rate (range) 0.6 % – 3.7 %

_____________________

Conditional prepayment rate (range) 19.5 % – 32.2 %

18.8 % – 21.9 %

As of the dates indicated, the fair value of our asset-backed bonds was not materially impacted by default assumptions on the underlying securitization loans, as the subordinate residual interests, by design, are expected to absorb all estimated losses based on our default assumptions for the respective periods.

Residual Investments and Residual Interests Classified as Debt

Residual investments and residual interests classified as debt do not trade in active markets with readily observable prices, and there is limited observable market data for reference.

The fair values of residual investments and residual interests classified as debt are determined using a discounted cash flow methodology.

Management classifies residual investments and residual interests classified as debt as Level 3 due to the use of significant unobservable inputs in the fair value measurements.

The following key unobservable inputs were used in the fair value measurements of our residual investments and residual interests classified as debt as of the dates indicated:

December 31, 2021 December 31, 2020

Range Weighted Average Range Weighted Average

Residual investments

Conditional prepayment rate 19.5 % – 33.6 %

(1) Variable lease cost includes non-lease components classified as lease costs, such as common area maintenance fees, property taxes and utilities, that vary in amount for reasons other than the passage of time.

We elected the practical expedient to not bifurcate the lease component from the non-lease components.

(2) We entered into a sublease arrangement through which we earned sublease income, which offset our lease cost related to the underlying premises.

During the year ended December 31, 2020, we offered the sublessee a partial rent abatement as a result of the COVID-19 pandemic.

The sublease arrangement terminated in August 2021.

(3) For the years ended December 31, 2022 and 2020, includes $ 764 and $ 5,640 , respectively, of operating lease ROU assets obtained through acquisitions.

Also includes impacts from lease modifications.

Supplemental balance sheet information related to our leases was as follows:

Operating Leases

$ 97,135 $ 115,191

Annual default rate 0.3 % – 5.7 %

Operating lease liabilities

$ 117,758 $ 138,794

Discount rate 2.6 % – 10.5 %

Weighted average remaining lease term (in years)

Weighted average discount rate

Finance Leases

ROU assets (1)

$ 10,067 $ 12,224

Residual interests classified as debt

Conditional prepayment rate 20.0 % – 41.8 %

Finance lease liabilities (2)

$ 13,683 $ 14,174

Annual default rate 0.5 % – 5.6 %

Weighted average remaining lease term (in years)

Weighted average discount rate

_____________________

Discount rate 5.0 % – 9.5 %

(1) Finance lease ROU assets are presented within property, equipment and software in the consolidated balance sheets.

(2) Finance lease liabilities are presented within accounts payable, accruals and other liabilities in the consolidated balance sheets.

As of December 31, 2022, future maturities of lease liabilities and a reconciliation of the total undiscounted cash flows to the lease liabilities in the consolidated balance sheets were as follows:

Operating Leases

Finance Leases

2023 $ 25,120 $ 964

The key assumptions included in the above table are defined as follows:

• Conditional prepayment rate — The monthly annualized proportion of the principal of a pool of loans that is assumed to be paid off prematurely in each period for the pool of loans in the securitization.

An increase in the conditional prepayment rate, in isolation, would result in a decrease in a fair value measurement.

The weighted average assumption was weighted based on relative fair value.

• Annual default rate — The annualized rate of borrowers who fail to remain current on their loans for the pool of loans in the securitization.

An increase in the annual default rate, in isolation, would result in a decrease in a fair value measurement.

The weighted average assumption was weighted based on relative fair value.

• Discount rate — The weighted average rate at which the expected cash flows are discounted to arrive at the net present value of the residual investments and residual interests classified as debt.

An increase in the discount rate, in isolation, would result in a decrease in a fair value measurement.

The weighted average assumption was weighted based on relative fair value.

The following table presents the changes in the residual investments and residual interests classified as debt, which are both measured at fair value on a recurring basis.

We record changes in fair value within noninterest income—securitizations in

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

the consolidated statements of operations and comprehensive income (loss), a portion of which is subsequently reclassified to interest expense—securitizations and warehouses for residual interests classified as debt and to interest income—securitizations for residual investments, but does not impact the liability or asset balance, respectively.

Residual Investments Residual Interests Classified as Debt

Fair value as of December 31, 2019 $ 262,880 $ 271,778

Additions 10,708 —

Change in valuation inputs or other assumptions (1)

2024 22,194 968

Transfers (3)

Derecognition upon achieving true sale accounting treatment — ( 101,718 )

Fair value as of December 31, 2020 $ 139,524 $ 118,298

Additions 49,317 2,170

Change in valuation inputs or other assumptions (1)

2025 20,705 1,038

2026 19,462 1,060

Fair value as of December 31, 2021 $ 121,019 $ 93,682

2027 14,921 1,061

(1) For residual investments, the estimated amount of gains (losses) included in earnings attributable to changes in instrument-specific credit risk were $( 230 ), $( 1,252 ) and $ 569 during the years ended December 31, 2021, 2020 and 2019, respectively.

The gains (losses) attributable to instrument-specific credit risk were estimated by incorporating our current default and loss severity assumptions for the residual investments.

These assumptions are based on historical performance, market trends and performance expectations over the term of the underlying instrument.

(2) Payments of residual investments included residual investment sales of $ 4,291 and $ 8,342 during the years ended December 31, 2021 and 2020, respectively.

(3) The year ended December 31, 2020 includes a transfer from residual investments (Level 3) to asset-backed bonds (Level 2) associated with a repackaged securitization transaction in which we formed a new VIE and, in the process, exchanged our residual interest for an asset-backed bond interest.

Loan Commitments

We classify student loan commitments as Level 3 because the assets do not trade in an active market with readily observable prices and, as such, our valuations utilize significant unobservable inputs.

Additionally, we classify IRLCs as Level 3, as our IRLCs are inherently uncertain and unobservable given that a home loan origination is contingent on a plethora of factors.

The following key unobservable inputs were used in the fair value measurements of our IRLCs and student loan commitments as of the dates indicated:

December 31, 2021 December 31, 2020

Range Weighted Average Range Weighted Average

Loan funding probability (1)

44,918 12,992

147,320 18,083

Student loan commitments

Loan funding probability (1)

imputed interest

( 29,562 ) ( 4,400 )

95.0 % n/a n/a

Lease liabilities

$ 117,758 $ 13,683

(1) The probability of honoring IRLCs and student loan commitments, which reflects the percentage likelihood that an approved loan application will close based on historical experience.

A significant difference between the actual funded rate and the assumed funded rate at the measurement date could result in a significantly higher or lower fair value measurement of our IRLCs and student loan commitments.

The aggregate amount of student loans we committed to fund was $ 53,189 as of December 31, 2021.

See Note 1 under “Derivative Financial Instruments” for the aggregate notional amount associated with IRLCs.

The key assumption included in the above table is defined as follows:

• Loan funding probability — Our expectation of the percentage of IRLCs or student loan commitments which will become funded loans.

An increase in the loan funding probabilities, in isolation, would result in an increase in a fair value measurement.

The weighted average assumptions were weighted based on relative fair values.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

The following table presents the changes in our IRLCs and student loan commitments, which are measured at fair value on a recurring basis.

Changes in the fair values of IRLCs and student loan commitments are recorded within noninterest income—loan origination and sales in the consolidated statements of operations and comprehensive income (loss).

IRLCs Student Loan Commitments

Fair value as of December 31, 2019 $ 1,090 $ —

Revaluation adjustments 62,528 —

Funded loans (1)

Unfunded loans (1)

Fair value as of December 31, 2020 $ 15,620 $ —

Revaluation adjustments 23,211 6,410

Funded loans (1)

Other Assets and Other Liabilities

The following table presents the components of other assets :

Accounts receivable, net (1)

$ 127,050 $ 85,523

Unfunded loans (1)

Digital assets safeguarding asset (2)

Prepaid expenses 73,429 57,903

Derivative financial instruments (3)

34,610 15,337

Fair value as of December 31, 2021 $ 3,759 $ 2,220

Restricted investments (4)

Investments in equity securities (5)

Other 23,943 6,425

Other assets $ 417,334 $ 171,242

_____________________

(1) For each quarter within the years presented, funded and unfunded loan fair value adjustments represent the unpaid principal balance of funded and unfunded loans, respectively, during the quarter multiplied by the IRLC or student loan commitment price in effect at the beginning of the quarter.

The amounts presented on a year-to-date basis represent the summation of the per-quarter effects.

Non-Securitization Investments

Non-securitization investments — ETFs of $ 1,486 and $ 6,850 as of December 31, 2021 and 2020, respectively, include investments in exchange-traded funds (“ETF”), which have targeted investment strategies.

Our investment as of December 31, 2021 included an ETF with investment grade and high-yield fixed income securities.

Our investment as of December 31, 2020 also included an ETF with equity securities seeking long-term capital appreciation and an ETF with widely held U.S.

stocks by SoFi members, both of which were sold during the 2021 period.

Non-securitization investments—ETFs are measured at fair value on a recurring basis using the net asset value expedient in accordance with ASC 820 and are presented within other assets in the consolidated balance sheets.

Non-securitization investments — Other of $ 6,054 and $ 1,147 as of December 31, 2021 and 2020, respectively, include investments for which fair values are not readily determinable, which we elect to measure using the measurement alternative method of accounting.

Under the measurement alternative method, we measure the investments at cost, less any impairment and adjusted for changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuers.

The carrying values of the investments are presented within other assets in the consolidated balance sheets.

Adjustments to the carrying value, such as impairments and unrealized gains, are recognized within noninterest income—other in the consolidated statements of operations and comprehensive income (loss).

The fair value measurements are classified within Level 3 of the fair value hierarchy due to the uses of unobservable inputs in the fair value measurements.

For one such investment with a fair value of $ 1,886 and $ 1,147 as of December 31, 2021 and 2020, respectively, we recorded an impairment charge of $ 803 in the second quarter of 2020 and adjusted the carrying value of the investment accordingly, which was based on a discounted cash flow analysis, wherein we weighted different valuation scenarios with different assumed internal rates of return and time to liquidity events.

In performing a qualitative impairment assessment, we determined that the carrying amount of the investment exceeded its fair value due to a significant decline in investee operating results relative to expectations, primarily as a result of the COVID-19 pandemic.

During the fourth quarter of 2021, we recorded an upward adjustment of $ 739 and adjusted the carrying value of the investment accordingly, because a new investor agreed to purchase the underlying company, of which the purchase price consideration was a significant input relied upon for our fair value measurement.

For an additional investment with a fair value of $ 2,168 as of December 31, 2021, we recognized a gain of $ 3,967 during the year ended December 31, 2021, which also represents our cumulative adjustment on this security and which we valued based on the investee’s latest round of financing during the second quarter of 2021.

We considered this recent equity transaction to be an orderly transaction in an issuance similar to our investment holding.

Additionally, we sold a portion of our

(1) Includes accounts receivable, net of allowance for credit losses, associated with revenue from contracts with customers, deposit-related receivables and other receivables.

See Note 5 for information on the allowance for credit losses on accounts receivable.

(2) See Note 1 and Note 15 for additional information on the digital assets safeguarding asset.

(3) See Note 14 for additional information on derivative financial instruments.

(4) Subsequent to operating SoFi Bank, we have investments in Federal Reserve Bank (“FRB”) stock and Federal Home Loan Bank (“FHLB”) stock, which are restricted investment securities that are not marketable.

These investments are carried at cost and assessed for impairment.

(5) As of December 31, 2022, primarily included an investment that was entered into in 2021 and recorded as an equity method investment until January 2022 in conjunction with relinquishing our seat on the investee’s board of directors.

Our equity method investment income for the year ended December 31, 2022 was immaterial and we did not receive any distributions.

The following table presents the components of accounts payable, accruals and other liabilities :

Accrued expenses (1)

$ 145,971 $ 94,199

Accounts payable 126,875 156,757

Digital assets safeguarding liability (2)

Deferred tax liabilities, net (3)

Accrued interest 17,700 1,306

Finance lease liability (4)

13,683 14,174

Deferred revenue (5)

Derivative financial instruments (6)

Other 29,399 26,524

Accounts payable, accruals and other liabilities $ 516,215 $ 298,164

_____________________

(1) Includes accrued compensation and compensation-related expenses, accrued taxes and other accrued expenses.

(2) See Note 1 and Note 15 for additional information on the digital assets safeguarding liability.

(3) See Note 17 for additional information on income taxes.

(4) See Note 9 for additional information on finance leases.

(5) See Note 3 for additional information on deferred revenue.

(6) See Note 14 for additional information on derivative financial instruments.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

investment during the year ended December 31, 2021 for $ 2,000 at the same valuation, contemporaneous with the investee’s latest round of financing.

During the fourth quarter of 2021, we made an additional non-securitization investment of $ 2,000 .

We did not make any adjustments to the investment value through December 31, 2021.

Non-securitization investments measured at fair value exclude our equity method investments, which are discussed further in Note 1.

Purchase Price Earn-Out

As of December 31, 2021, we had a derivative for a purchase price earn-out in conjunction with a loan sale agreement we entered into during 2018, as further discussed in Note 1.

We receive a capped contractual payout based on the respective loan pool internal rate of return over a certain hurdle rate, which is adjusted for the loan purchaser’s expenses, which are generally immaterial.

Prior to 2021, the purchase price earn-out value was immaterial.

The fair value of the purchase price earn-out is determined using a discounted cash flow methodology.

Management classifies the purchase price earn-out as Level 3 due to the use of significant unobservable inputs in the fair value measurement.

A significant difference between the expected performance of the loans included in the loan sale agreement and the actual results as of the measurement date could result in a higher or lower fair value measurement.

Our key valuation inputs were as follows as of the date indicated:

We commenced offering deposit accounts (referred to as “SoFi Checking and Savings” accounts) to our members through SoFi Bank in the first quarter of 2022.

Our interest-bearing deposits primarily consist of demand deposits, savings deposits and, to a lesser extent, time deposits.

We also have noninterest-bearing deposits associated with legacy Golden Pacific accounts.

The following table presents a detail of interest-bearing deposits:

December 31, 2022

Purchase Price Earn-Out Range Weighted Average

Conditional prepayment rate 22.9 % – 22.9 %

Annual default rate 30.0 % – 30.0 %

Discount rate 25.0 % – 25.0 %

The key assumptions included in the above table are defined as follows:

• Conditional prepayment rate — The monthly annualized proportion of the principal of the pool of loans included in the loan sale agreement that is assumed to be paid off prematurely.

An increase in the conditional prepayment rate, in isolation, would result in a decrease in a fair value measurement.

The weighted average assumption was weighted based on relative fair value.

• Annual default rate — The annualized rate of borrowers who fail to remain current on their loans for the pool of loans included in the loan sale agreement.

An increase in the annual default rate, in isolation, would result in a decrease in a fair value measurement.

The weighted average assumption was weighted based on relative fair value.

• Discount rate — The weighted average rate at which the expected cash flows are discounted to arrive at the net present value of the purchase price earn-out derivative.

An increase in the discount rate, in isolation, would result in a decrease in a fair value measurement.

The weighted average assumption was weighted based on relative fair value.

The following table presents the changes in our purchase price earn-out, which is measured at fair value on a recurring basis.

Changes in the fair value are recorded within noninterest income—other in the consolidated statements of operations and comprehensive income (loss).

Purchase Price Earn-Out

Fair value as of January 1, 2021 $ —

Initial recognition (1)

Payments ( 5,040 )

Changes in valuation inputs or assumptions

Fair value as of December 31, 2021 $ 4,272

Savings deposits $ 4,383,953

Demand deposits (1)

Time deposits (1)(2)

Total interest-bearing deposits $ 7,265,792

_____________________

(1) The estimated amount of losses included in earnings attributable to changes in instrument-specific credit risk were $ 286 during the year ended December 31, 2021.

The losses attributable to instrument-specific credit risk were estimated by incorporating our current default and loss severity assumptions for the purchase price earn-out.

These assumptions are based on historical performance and performance expectations over the term of the underlying instrument.

(1) Includes brokered deposits of $ 1,026,400 , of which $ 940,000 are time deposits and $ 86,400 are demand deposits.

(2) The amount of time deposits that exceeded the insured limit (referred to as “uninsured deposits”) totaled $ 20,842 .

As of December 31, 2022, future maturities of our total time deposits were as follows:

2023 $ 966,556

Total $ 969,387

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

Warrant Liabilities – SoFi Technologies Warrants

Prior to the Business Combination, SCH issued 8,000,000 private placement warrants to SCH Sponsor V LLC (the “Sponsor”) and 20,125,000 public warrants (collectively, “SoFi Technologies warrants”).

Upon the Closing of the Business Combination, the Company assumed the SoFi Technologies warrants.

Each whole warrant entitles the holder to purchase one share of Class A common stock, subject to adjustment, for an exercise price of $ 11.50 per share.

The SoFi Technologies warrants became exercisable on October 14, 2021, except as described herein.

Once the SoFi Technologies warrants became exercisable, the Company could redeem the outstanding warrants, in whole, upon a minimum 30 days’ prior written notice of redemption (“Redemption Period”) under one of two potential scenarios.

For purposes of the redemption scenarios, the “Reference Value” represented the last reported sale price of SoFi Technologies common stock for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption.

Prior to the Business Combination, SCH evaluated the public warrants and private placement warrants under ASC 815-40, Derivatives and Hedging – Contracts in Entity’s Own Equity, and concluded that they did not meet the criteria to be classified in permanent equity.

Specifically, the settlement feature for the private placement warrants precluded them from being considered indexed to SCH’s own stock, given that a change in the holder of the private placement warrants may have altered the settlement of the private placement warrants.

Since the holder of the instrument was not an input to a standard option pricing model (a consideration with respect to the indexation guidance), the fact that a change in the holder may impact the value of the private placement warrants meant the private placement warrants were not indexed to the SCH’s own stock.

Further, a provision in the warrant agreement related to certain tender or exchange offers precluded the public warrants and private placement warrants from being accounted for as components of permanent equity.

Since the public warrants and private placement warrants met the definition of a derivative under ASC 815, SCH recorded these warrants as liabilities on the balance sheet at fair value, with subsequent changes in their respective fair values recognized in earnings in accordance with ASC 820.

As the accounting acquirer in the Business Combination, and because there were no changes to the terms and conditions of the warrant agreement, SoFi Technologies warrants continued to be classified as derivative liabilities subsequent to the Business Combination, subject to recurring fair value measurement under ASC 820, with changes in fair value recognized in the consolidated statements of operations and comprehensive income (loss) in the period of change.

Following the Business Combination, 28,125,000 shares of common stock were issuable upon the exercise of the SoFi Technologies warrants, which were initially valued at $ 200,250 .

On November 4, 2021, we announced that we would redeem all outstanding SoFi Technologies warrants that remained outstanding at 5:00 p.m.

New York City time on December 6, 2021 (the “Redemption Date”) for a redemption price of $ 0.10 per warrant.

The Warrants were exercisable by the holders thereof until 5:00 p.m.

New York City time on the Redemption Date to purchase fully paid and non-assessable shares of common stock underlying such warrants.

Payment upon exercise of the warrants was made either (i) in cash, at an exercise price of $ 11.50 per share of common stock, or (ii) on a “cashless basis” in which the exercising holder received a number of shares of common stock determined in accordance with the terms of the warrant agreement and based on the Redemption Date and the volume weighted average price (the “fair market value”) of the common stock during the 10 trading days immediately following November 4, 2021, which the Company provided holders no later than one business day after the 10-trading day period ended.

In no event did the number of shares of common stock issued in connection with an exercise on a cashless basis exceed 0.361 shares of common stock per warrant.

Any warrants that remained unexercised on the Redemption Date were void and no longer exercisable, and the holders of those warrants received the redemption price of $ 0.10 per warrant, which represented an immaterial cash payment by the Company.

Following the Redemption Date, the Company had no SoFi Technologies warrants outstanding.

In connection with the redemption, the SoFi Technologies Warrants ceased trading on the Nasdaq Global Select Market and were delisted, with the trading halt announced after close of market on December 6, 2021.

As a result of warrant exercises and redemptions, we issued 15,193,668 shares of common stock and received cash proceeds of $ 95,047 , as well as reclassified $ 185,762 from liabilities to equity.

The Company measured the fair value of the warrant liabilities on a daily basis determined as the opening number of warrants outstanding multiplied by the closing price of SOFIW and adjusted for any warrant exercises, with fair value changes recorded within noninterest expense—general and

SoFi Technologies, Inc.

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(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

administrative in the consolidated statements of operations and comprehensive income (loss).

During the year ended December 31, 2021, we recorded fair value gains of $ 14,488 .

The following table summarizes the Company’s principal outstanding debt, unamortized debt discounts/premiums and unamortized debt issuance costs as of the dates indicated:

Outstanding as of

Borrowing Description Collateral Balances (1)

Interest Rate (2)

Total Capacity (4)

December 31, 2021 (5)

December 31, 2020

Student Loan Warehouse Facilities

SoFi Funding I $ — 1ML + 125 bps

April 2022 $ 200,000 $ — $ 374,575

SoFi Funding III (6)

4,440 PR – 134 bps

September 2024 75,000 3,930 30,170

SoFi Funding V (7)

— 1ML + 135 bps

May 2023 350,000 — —

SoFi Funding VI 60,614 3ML + 125 bps

March 2024 600,000 56,709 432,437

SoFi Funding VII 313,726 SOFR + 85 bps

September 2024 500,000 284,475 276,910

SoFi Funding VIII 269,254 1ML + 90 bps

May 2022 300,000 245,723 221,342

SoFi Funding IX (8)

10,417 SOFR+ 210 bps and

CP + 87.5 bps

May 2025 500,000 9,816 70,780

SoFi Funding X (9)

33,423 CP + 125 bps

April 2024 400,000 29,647 44,136

SoFi Funding XI (10)

— CP + 115 bps

November 2023 500,000 — 87,404

SoFi Funding XII (11)

25,087 CP + 115 bps

November 2024 200,000 20,267 —

SoFi Funding XIII 481,731 SOFR + 55 bps

April 2024 450,000 424,348 —

Total, before unamortized debt issuance costs $ 1,198,692 $ 4,075,000 $ 1,074,915 $ 1,537,754

Unamortized debt issuance costs $ ( 7,540 ) $ ( 7,940 )

The following table summarizes the components of our debt:

December 31, 2022 December 31, 2021

Borrowing Description Total Collateral (1)

Stated Interest Rate (2)

Weighted Average Effective Interest Rate (3)

Total Capacity Total Outstanding (5)

Total Outstanding

Debt Facilities

Student loan warehouse facilities $ 2,530,021 4.85 % – 6.40 %

5.70 % April 2023 – May 2025

$ 4,300,000 $ 1,504,926 $ 1,074,915

Personal loan warehouse facilities 1,679,414 4.60 % – 6.41 %

SoFi Funding PL I (12)

$ 14,516 CP + 137.5 bps

September 2023 $ 250,000 $ 11,911 $ —

SoFi Funding PL II — 3ML + 225 bps

July 2023 400,000 — 137,420

SoFi Funding PL III — 1ML + 175 bps

May 2023 250,000 — 2,793

SoFi Funding PL IV (13)

— CP + 170 bps

November 2023 500,000 — 132,416

SoFi Funding PL VI (14)

— CP + 170 bps

September 2024 50,000 — 107,595

SoFi Funding PL VII 88,976 1ML + 115 bps

June 2022 250,000 71,572 15,610

SoFi Funding PL X — 1ML + 142.5 bps

February 2023 200,000 — 3,004

SoFi Funding PL XI — 1ML + 170 bps

January 2022 200,000 — 112,478

SoFi Funding PL XII — 1ML + ( 225 - 315 bps)

June 2021 — — 127,724

SoFi Funding PL XIII — 1ML + 175 bps

January 2030 300,000 — 219,362

SoFi Funding PL XIV (15)

168,624 1ML + 90 bps

October 2024 300,000 144,662 —

Total, before unamortized debt issuance costs $ 272,116 $ 2,700,000 $ 228,145 $ 858,402

Unamortized debt issuance costs $ ( 3,898 ) $ ( 6,692 )

Weighted average effective interest rate 2.08 % 3.63 %

Home Loan Warehouse Facilities

Mortgage Warehouse VI $ — SOFR + 200 bps

October 2022 $ 1,000 $ — $ —

Total, before unamortized debt issuance costs $ — $ 1,000 $ — $ —

Weighted average effective interest rate — % — %

Credit Card Warehouse Facilities

SoFi Funding CC I LLC (16)

$ 14,471 CP + 175 bps

October 2022 $ 100,000 $ 11,810 $ —

Total, before unamortized debt issuance costs $ 14,471 $ 100,000 $ 11,810 $ —

Unamortized debt issuance costs

5.82 % January 2023 – January 2032

3,800,000 1,452,085 228,145

Weighted average effective interest rate 6.39 % — %

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

Outstanding as of

Borrowing Description Collateral Balances (1)

Interest Rate (2)

Total Capacity (4)

December 31, 2021 (5)

December 31, 2020

Credit card warehouse facility — 5.94 % — % December 2023 100,000 — 11,810

Risk retention warehouse facilities (6)

SoFi RR Funding I $ 28,407 3ML + 200 bps

January 2024 $ 100,000 $ 22,608 $ 54,304

SoFi RR Repo 84,240 3ML + 185 bps

June 2023 192,141 69,843 75,863

SoFi C RR Repo — 3ML + ( 180 - 185 bps)

December 2021 — 42,757

SoFi RR Funding II 109,204 1ML + 125 bps

November 2024 98,031 160,199

SoFi RR Funding III 43,334 1ML + 125 bps

November 2024 39,158 60,786

SoFi RR Funding IV (7)

81,797 1ML + 150 bps

October 2027 100,000 66,555 37,334

SoFi RR Funding V 54,791 298 bps

December 2025 29,453 —

Total, before unamortized debt issuance costs $ 401,773 $ 325,648 $ 431,243

Unamortized debt issuance costs $ ( 2,086 ) $ ( 2,052 )

Weighted average effective interest rate 2.00 % 2.24 %

125,184 5.80 % – 6.77 %

6.55 % January 2024 – October 2027

200,000 101,964 325,648

Revolving credit facility (7)

SoFi Corporate Revolver (18)(19)

n/a 1ML + 100 bps

5.39 % 5.47 % September 2023 560,000 486,000 486,000

Total, before unamortized debt issuance costs $ 560,000 $ 486,000 $ 486,000

Unamortized debt issuance costs $ ( 626 ) $ ( 987 )

Weighted average effective interest rate 1.18 % 1.26 %

Convertible senior notes (20)

n/a 0.00 % October 2026 $ 1,200,000 $ —

Total, before unamortized debt issuance costs and discount $ 1,200,000 $ —

Unamortized debt issuance costs $ ( 1,634 ) $ —

Unamortized discount ( 22,858 ) —

Weighted average effective interest rate 0.43 % — %

Seller note (21)

February 2021 $ — $ 250,000

Total $ — $ 250,000

Weighted average effective interest rate 10.00 % 10.00 %

Other financing – various notes (21)

n/a 331 – 547 bps

July 2021 $ — $ 4,375

Total $ — $ 4,375

Weighted average effective interest rate 3.58 % 3.64 %

Student Loan Securitizations

SoFi PLP 2016-B LLC $ 48,821 1ML + ( 120 - 380 bps)

April 2037 $ 43,186 $ 69,448

SoFi PLP 2016-C LLC 55,662 1ML + ( 110 - 335 bps)

May 2037 49,685 81,115

SoFi PLP 2016-D LLC 69,636 1ML + ( 95 - 323 bps)

January 2039 61,760 93,942

SoFi PLP 2016-E LLC 81,975 1ML + ( 85 - 443 bps)

October 2041 74,242 117,800

SoFi PLP 2017-A LLC 102,677 1ML + ( 70 - 443 bps)

March 2040 92,972 146,064

SoFi PLP 2017-B LLC 86,686 274 – 444 bps

May 2040 78,811 129,873

SoFi PLP 2017-C LLC 113,022 1ML + ( 60 - 421 bps)

July 2040 102,814 161,897

Total, before unamortized debt issuance costs and discount $ 558,479 $ 503,470 $ 800,139

Unamortized debt issuance costs $ ( 3,851 ) $ ( 5,958 )

Unamortized discount ( 1,094 ) ( 1,654 )

Weighted average effective interest rate 3.30 % 3.22 %

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

Outstanding as of

Borrowing Description Collateral Balances (1)

Interest Rate (2)

Total Capacity (4)

December 31, 2021 (5)

December 31, 2020

Convertible senior notes — % 0.42 % October 2026 1,200,000 1,200,000

Other financing (8)

22,899 22,157 — —

Securitizations

Personal loan securitizations 660,998 0.49 % – 6.21 %

SoFi CLP 2016-1 LLC $ — 326 bps

December 2021 $ — $ 36,546

SoFi CLP 2016-2 LLC — 477 bps

December 2021 — 37,973

SoFi CLP 2016-3 LLC — 449 bps

September 2021 — 30,780

SoFi CLP 2018-3 LLC 82,550 402 – 467 bps

August 2027 76,535 163,784

SoFi CLP 2018-4 LLC 93,564 417 – 476 bps

November 2027 86,835 184,831

SoFi CLP 2018-3 Repack LLC — 200 bps

March 2021 — 2,457

SoFi CLP 2018-4 Repack LLC — 200 bps

June 2021 — 5,853

Total, before unamortized debt issuance costs, premiums and discount $ 176,114 $ 163,370 $ 462,224

Unamortized debt issuance costs $ ( 1,683 ) $ ( 3,057 )

Unamortized premium (discount) 207 ( 2,872 )

Weighted average effective interest rate 4.58 % 4.47 %

5.80 % September 2030 – April 2031

529,132 163,370

Student loan securitizations 276,170 2.74 % – 8.82 %

7.09 % January 2039 – July 2040

246,856 503,470

Total, before unamortized debt issuance costs, premiums and discounts

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unamortized debt issuance costs, premiums and discounts ( 35,081 ) ( 45,375 )

Total reported debt $ 3,947,983 $ 4,798,925

Total debt $ 5,485,882 $ 3,947,983

_____________________

(1) As of December 31, 2021, represents unpaid principal balances, with the exception of the risk retention warehouse facilities, which include securitization-related investments carried at fair value.

(1) As of December 31, 2022, represents the total of the unpaid principal balances within each debt category, with the exception of the risk retention warehouse facilities, which include securitization-related investments carried at fair value.

In addition, certain securitization interests that eliminate in consolidation are pledged to risk retention warehouse facilities.

Collateral balances relative to debt balances as presented may vary period to period due to the timing of the next scheduled payment to the warehouse facility.

(2) Unused commitment fees ranging from 0 to 75 basis points (“bps”) on our various warehouse facilities are recognized as noninterest expense—general and administrative in our consolidated statements of operations and comprehensive income (loss).

“ML” stands for “Month LIBOR”.

As of December 31, 2021, 1ML and 3ML was 0.10% and 0.21%, respectively.

As of December 31, 2020, 1ML and 3ML was 0.14% and 0.24%, respectively.

“SOFR” stands for “Secured Overnight Financing Rate”.

As of December 31, 2021, SOFR was 0.05%.

“PR” stands for “Prime Rate”.

As of December 31, 2021 and 2020, PR was 3.25% and 3.25%, respectively.

Collateral balances relative to debt balances may vary period to period due to the timing of the next scheduled payment to the warehouse facility.

(2) For variable-rate debt, the ranges of stated interest rates are based on the interest rates in effect as of December 31, 2022.

The interest on our variable-rate debt is typically designed as a reference rate plus a spread.

Reference rates as of December 31, 2022 included one-month LIBOR, three-month LIBOR, overnight SOFR, one-month SOFR, three-month SOFR, prime rate and commercial paper rates determined by the facility lenders.

As debt arrangements are renewed, the reference rate and/or spread are subject to change.

Unused commitment fees ranging from 0 to 65 basis points (“bps”) on our various warehouse facilities are recognized within noninterest expense—general and administrative in our consolidated statements of operations and comprehensive income (loss).

(3) Weighted average effective interest rates are calculated based on the interest rates in effect as of December 31, 2022 and include the amortization of debt issuance costs.

(4) For securitization debt, the maturity of the notes issued by the various trusts occurs upon either the maturity of the loan collateral or full payment of the loan collateral held in the trusts.

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Securitization debt matures as loan collateral payments are made.

(4) Represents total capacity as of December 31, 2021.

(5) There was a debt discount of $ 24,000 associated with the Convertible Notes discussed below and a debt premium of $ 335 issued during the year ended December 31, 2021.

We paid $ 1,600 during 2021 related to debt issuance costs accrued in 2020.

(6) Warehouse facility has a prime rate floor of 309 bps.

(7) Warehouse facilities have a 1ML floor of 25 bps.

(8) Warehouse facility incurs different interest rates on its two types of asset classes.

One such class incurs interest based on a commercial paper (“CP”) rate, which is determined by the facility lender.

As of December 31, 2021 and 2020, the CP rate for this facility was 0.19 % and 0.25 %, respectively.

(9) Warehouse facility incurs interest based on a CP rate, which is determined by the facility lender.

As of December 31, 2021 and 2020, the CP rate for this facility was 0.24 % and 0.28 %, respectively.

(10) Warehouse facility incurs interest based on a CP rate, which is determined by the facility lender.

As of December 31, 2021 and 2020, the CP rate for this facility was 0.19 % and 0.25 %, respectively.

(11) Warehouse facility incurs interest based on a CP rate, which is determined by the facility lender.

As of December 31, 2021, the CP rate for this facility was 0.19 %.

Under certain conditions, warehouse facility could incur an interest rate spread of 215 bps.

(12) Warehouse facility incurs interest based on a CP rate, which is determined by the facility lender.

As of December 31, 2021, the CP rate for this facility was 0.18 %.

As of December 31, 2020, this facility incurred interest based on 1ML.

(13) Warehouse facility incurs interest based on a CP rate, which is determined by the facility lender.

As of December 31, 2021 and 2020, the CP rate for this facility was 0.16 % and 0.25 %, respectively.

(14) Warehouse facility incurs interest based on a CP rate, which is determined by the facility lender.

As of December 31, 2021, the CP rate for this facility was 0.16 %.

As of December 31, 2020, this facility incurred interest based on 3ML.

(15) Warehouse facility expected to be subject to SOFR + 11.5 bps upon benchmark replacement.

(16) Warehouse facility incurs interest at a spread (as indicated in the table) plus the lower of (a) 3ML plus 35 bps or (b) the CP rate for this facility, which is determined by the facility lender.

As of December 31, 2021, the CP rate for this facility was 0.24 %.

(17) Financing was obtained for both asset-backed bonds and residual investments in various personal loan and student loan securitizations, and the underlying collateral are the underlying asset-backed bonds and residual investments.

We only state capacity amounts in this table for risk retention facilities wherein we can pledge additional asset-backed bonds and residual investments as of December 31, 2021.

(5) There were no debt discounts or premiums issued during the year ended December 31, 2022.

(6) For risk retention warehouse facilities, we only state capacity amounts for facilities wherein we can pledge additional asset-backed bonds and residual investments as of the balance sheet date.

(7) As of December 31, 2022, $ 6.0 million of the revolving credit facility total capacity was not available for general borrowing purposes because it was utilized to secure a letter of credit.

Refer to our letter of credit disclosures in Note 18 for more details.

Additionally, the interest rate presented is the interest rate on standard withdrawals on our revolving credit facility, while same-day withdrawals incur interest based on prime rate.

(8) Includes $ 22.9 million of loans pledged as collateral to secure $ 14.6 million of available borrowing capacity with the FHLB, of which $ 11.7 million was not available as it was utilized to secure letters of credit.

Refer to our letter of credit disclosures in Note 18 for more details.

Also includes unsecured available borrowing capacity of $ 7.6 million with correspondent banks.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

(18) As of December 31, 2021, $ 6.0 million of the revolving credit facility total capacity was not available for general borrowing purposes because it was utilized to secure a letter of credit.

Refer to our letter of credit disclosures in Note 16 for more details.

(19) Interest rate presented is the interest rate on standard withdrawals on our revolving credit facility, while same-day withdrawals incur interest based on PR.

(20) In the fourth quarter of 2021, we issued and sold convertible senior notes.

See related section below for additional information.

(21) Part of our consideration to acquire Galileo was in the form of a seller note financing arrangement, which we paid off in February 2021.

See Note 2 for additional information.

We also assumed certain other financing arrangements resulting from our acquisition of Galileo, which we paid off during the third quarter of 2021.

The total accrued interest payable on borrowings of $ 13,538 and $ 1,158 as of December 31, 2022 and 2021, respectively, was presented within accounts payable, accruals and other liabilities in the consolidated balance sheets.

Convertible Senior Notes

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The original issue discount and debt issuance costs are amortized into interest expense—corporate borrowings in the consolidated statements of operations and comprehensive income (loss) using the effective interest method over the contractual term of the Convertible Notes.

For the year ended December 31, 2021, total interest expense on the Convertible Notes was $ 1.2 million, related to amortization of debt discount and issuance costs.

For the years ended December 31, 2022 and 2021, total interest expense on the Convertible Notes was $ 5.1 million and $ 1.2 million, respectively, related to amortization of debt discount and issuance costs.

As of December 31, 2022 and 2021, unamortized debt discount and issuance costs were $ 19.4 million and $ 24.5 million, respectively.

We used a portion of the net proceeds to fund the cost of entering into the Capped Call Transactions, as described in Note 13.

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In addition, calling any note for redemption will also constitute a Make-Whole Fundamental Change with respect to that note, in which case the conversion rate applicable to the conversion of that note will be increased in certain circumstances if it is converted after it is called for redemption.

See Note 1 for our accounting policy as it relates to the Convertible Notes.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

See Note 1 for our accounting policy as it relates to the Convertible Notes.

Material Changes to Debt Arrangements

During the year ended December 31, 2021, we:

• issued Convertible Notes, as discussed above;

• paid off the seller note issued in 2020 for a total payment of $ 269,864 , consisting of outstanding principal of $ 250,000 and accrued interest of $ 19,864 , and paid off the other financing arrangements assumed in connection with the acquisition of Galileo;

• opened two student loan warehouse facilities with an aggregate maximum available capacity of $ 650,000 ;

• opened one personal loan warehouse facility with a maximum available capacity of $ 300,000 and closed one personal loan warehouse facility that had a maximum available capacity of $ 250,000 ;

• had one home loan warehouse facility mature that had a maximum available capacity of $ 150,000 ;

• opened one credit card warehouse facility with a maximum available capacity of $ 100,000 ;

• opened one risk retention warehouse facility.

During the year ended December 31, 2022, we opened four personal loan warehouse facilities with an aggregate maximum available capacity of $ 1.5 billion, closed our only home loan warehouse facility that had a maximum available capacity of $ 1.0 million, and closed one risk retention warehouse facility that had a maximum available capacity of $ 192.1 million.

Our warehouse and securitization debt is secured by a continuing lien and security interest in the loans financed by the proceeds.

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Maturities of Borrowings

As of December 31, 2021, future maturities of our outstanding debt with scheduled payments, which included our revolving credit facility and convertible notes, were as follows:

Future maturities of our outstanding debt with scheduled payments, which included our revolving credit facility and Convertible Notes, were as follows:

December 31, 2022

2023 $ 486,000

2026 1,200,000

Total $ 1,686,000

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The authorized shares of SoFi Technologies Redeemable Preferred Stock is inclusive of 4,500,000 shares of Series 1 redeemable preferred stock (“Series 1 Redeemable Preferred Stock”), which reflect the conversion on a one -for-one basis of shares of Social Finance Series 1 preferred stock in conjunction with the Business Combination.

Shares of SoFi Technologies Series 1 Redeemable Preferred Stock that are redeemed, purchased or otherwise acquired by the Company will be

Shares of SoFi Technologies Series 1 Redeemable Preferred Stock that are redeemed, purchased or otherwise acquired by the Company will be canceled and may not be reissued by the Company.

The Series 1 Redeemable Preferred Stock remains classified as temporary equity because the Series 1 Redeemable Preferred Stock is not fully controlled by the issuer, SoFi Technologies.

See “Series 1 Preference and Rights” for additional provisions of the SoFi Technologies Series 1 Redeemable Preferred Stock.

As of December 31, 2022, there were 3,234,000 shares of SoFi Technologies Series 1 Redeemable Preferred Stock issued and outstanding, which had an original issuance price of $ 100.00 .

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

canceled and may not be reissued by the Company.

The Series 1 Redeemable Preferred Stock remains classified as temporary equity because the Series 1 Redeemable Preferred Stock is not fully controlled by the issuer, SoFi Technologies.

See “Series 1 Preference and Rights” for additional provisions of the SoFi Technologies Series 1 Redeemable Preferred Stock.

In addition to the Series 1 preferred stock, prior to the Business Combination, the Company had outstanding shares of Series A, Series B, Series C, Series D, Series E, Series F, Series G, Series H and Series H-1 preferred stock (collectively, “Preferred Stock”).

Immediately prior to the Business Combination, all shares of the Company’s outstanding Preferred Stock, other than the Series 1 preferred stock, converted into a total of 465,832,666 shares of SoFi Technologies common stock on the following basis ( 15,000,000 of which were classified as redeemable common stock and immediately redeemed subsequent to the Business Combination):

• each share of Social Finance Series A, Series B, Series C, Series D, Series E and Series H-1 preferred stock was converted into the right to receive shares of SoFi Technologies common stock equal to the Exchange Ratio (as discussed in Note 2);

• each share of Social Finance Series F preferred stock was converted into the right to receive shares of SoFi Technologies common stock equal to 1.1102 multiplied by the Exchange Ratio;

• each share of Social Finance Series G preferred stock was converted into the right to receive shares of SoFi Technologies common stock equal to 1.2093 multiplied by the Exchange Ratio;

• each share of Social Finance Series H preferred stock was converted into the right to receive shares of SoFi Technologies common stock equal to 1.0863 multiplied by the Exchange Ratio (except for shares of Series H preferred stock held by our Chief Executive Officer, which were converted into the right to receive shares of SoFi Technologies common stock equal to the Exchange Ratio).

As of December 31, 2021, there were no shares of SoFi Technologies Preferred Stock issued and outstanding and there were 3,234,000 shares of SoFi Technologies Series 1 Redeemable Preferred Stock issued and outstanding, which had an original issuance price of $ 100.00 .

Recent Issuances and Redemptions

In conjunction with the Business Combination, we redeemed and canceled 15,000,000 shares of redeemable SoFi Technologies common stock for a purchase price of $ 150.0 million.

During December 2020, we exercised a call and redeemed certain shares of redeemable preferred stock, which were retired upon receipt and for which the cash payment was made in January 2021.

See Note 15 for additional information.

Series 1 Preference and Rights

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Noto, the Chief Executive Officer and one of the directors of SoFi, entered into the Amended and Restated Series 1 Preferred Stock Investors’ Agreement (the “Amended Series 1 Agreement”), which amended the Series 1 Preferred Stock Investors’ Agreement dated May 29, 2019 (the “Original Series 1 Agreement”).

Under the Original Series 1 Agreement, the Series 1 preferred stock had limited price protection in the instance that the Company liquidated, finalized an initial public offering, or sold control of the Company to a third party, which events would have triggered a special payment provision.

In conjunction with the Business Combination, the Amended Series 1 Agreement amended the original special payment provision to provide for a one-time special payment of $ 21.2 million to Series 1 preferred stockholders, which was paid from the proceeds of the Business Combination and settled contemporaneously with the Business Combination.

The special payment was recognized within noninterest expense—general and administrative in the consolidated statements of operations and comprehensive income (loss), as this feature was accounted for as an embedded derivative that was not clearly and closely related to the host contract, and will have no subsequent impact on our consolidated financial results.

In conjunction with the Business Combination, the Amended Series 1 Agreement amended the special payment provision under the original agreement to provide for a one-time special payment of $ 21.2 million to the holders of Series 1 Redeemable Preferred Stock, which was paid from the proceeds of the Business Combination and settled contemporaneously with the Business Combination.

The special payment was recognized within noninterest expense—general and administrative in the consolidated statements of operations and comprehensive income (loss), as this feature was accounted for as an embedded derivative that was not clearly and closely related to the host contract, and did not have a subsequent impact on our consolidated financial results.

The Series 1 Redeemable Preferred Stock has no stated maturity.

In addition, in connection with the Business Combination, the Series 1 preferred stockholders entered into the Series 1 Registration Rights Agreement upon request by QIA, which provides Series 1 preferred stockholders with certain registration rights, provides for certain shelf registration filing obligations by SoFi and limits the future registration rights that SoFi may grant other parties.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

Prior to the Business Combination, no dividends were declared or paid subject to the preferred stock dividend provisions.

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The Company may defer any scheduled dividend payment for up to three semiannual dividend periods, subject to such deferred dividend accumulating and compounding at the applicable Series 1 Dividend Rate.

If the Company defers any single scheduled dividend payment on the Series 1 Redeemable Preferred Stock for four or more semiannual dividend periods, the Series 1 Dividend Rate applicable to (i) the compounding following the date of such default on all then-deferred dividend payments (whether or not deferred for four or more semiannual dividend periods) is applied on a go-forward basis and not retroactively, and (ii) new dividends declared following the date of such default and the compounding on such dividends if such new dividends are deferred shall be equal to the otherwise applicable Series 1 Dividend Rate plus 400 basis points.

If the Company defers any single scheduled dividend payment on the Series 1 Redeemable Preferred Stock for four or more semiannual dividend periods, the Series 1 Dividend Rate applicable to:

(i) the compounding following the date of such default on all then-deferred dividend payments (whether or not deferred for four or more semiannual dividend periods) is applied on a go-forward basis and not retroactively, and (ii) new dividends declared following the date of such default and the compounding on such dividends if such new dividends are deferred shall be equal to the otherwise applicable Series 1 Dividend Rate plus 400 basis points.

This default-related increase shall continue to apply until the Company pays all deferred dividends and related compounding.

Once the Company is current on all such dividends, it may again commence deferral of any pre-scheduled dividend payment for up to three semiannual dividend periods, following the same procedure as outlined in the foregoing.

There were no dividend deferrals during the years ended December 31, 2021 and 2020.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

Subsequent to the Business Combination, the conversion provisions in respect of each series of preferred stock were no longer in effect, other than the Series 1 Redeemable Preferred Stock, which did not have any rights of conversion.

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Pursuant to the SoFi Technologies Certificate of Incorporation, the Series 1 Redeemable Preferred Stock is redeemable at SoFi’s option in certain circumstances.

SoFi may, at any time but no more than three times, at its option, settle the Series 1 Redeemable Preferred Stock, in whole or in part, but if in part, in an amount no less than (i) one-third of the total amount of Series 1 Redeemable Preferred Stock outstanding as of May 28, 2021 or (ii) the remainder of Series 1 Redeemable Preferred Stock outstanding (the “Minimum Redemption Amount”).

In addition, SoFi may, at its option, settle for cash the Series 1 Redeemable Preferred Stock in whole, but not in part, within 120 days of the occurrence of a Change of Control (as that term is

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

defined in the SoFi Technologies Certificate of Incorporation), which would result in a payment of the initial purchase price of the Series 1 preferred stock of $ 323.4 million plus any unpaid dividends on such stock (whether deferred or otherwise) (the “Series 1 Redemption Price”).

SoFi may, at any time but no more than three times, at its option, settle the Series 1 Redeemable Preferred Stock, in whole or in part, but if in part, in an amount no less than:

(i) one-third of the total amount of Series 1 Redeemable Preferred Stock outstanding as of May 28, 2021 or (ii) the remainder of Series 1 Redeemable Preferred Stock outstanding (the “Minimum Redemption Amount”).

In addition, SoFi may, at its option, settle for cash the Series 1 Redeemable Preferred Stock in whole, but not in part, within 120 days of the occurrence of a Change of Control (as that term is defined in the SoFi Technologies Certificate of Incorporation), which would result in a payment of the initial purchase price of the Series 1 preferred stock of $ 323.4 million plus any unpaid dividends on such stock (whether deferred or otherwise) (the “Series 1 Redemption Price”).

Such settlement is determined at the discretion of the Board of Directors .

If any such optional redemption by the Company occurs either (i) prior to the fifth anniversary of the Series 1 Original Issue Date or (ii) after the fifth anniversary of the Series 1 Original Issue Date and not on a Dividend Reset Date, the Series 1 Redeemable Preferred Stock is entitled to receive an amount in cash equal to any such dividends that would have otherwise been payable to the holder on its redeemed shares of Series 1 Redeemable Preferred Stock for all dividend periods following the applicable optional redemption date up to and including the Dividend Reset Date immediately following such optional redemption date.

If any such optional redemption by the Company occurs either:

(i) prior to the fifth anniversary of the Series 1 Original Issue Date or (ii) after the fifth anniversary of the Series 1 Original Issue Date and not on a Dividend Reset Date, the Series 1 Redeemable Preferred Stock is entitled to receive an amount in cash equal to any such dividends that would have otherwise been payable to the holder on its redeemed shares of Series 1 Redeemable Preferred Stock for all dividend periods following the applicable optional redemption date up to and including the Dividend Reset Date immediately following such optional redemption date.

If the Series 1 Redeemable Preferred Stock is not earlier redeemed by the Company, each holder of Series 1 Redeemable Preferred Stock has the right to require SoFi to settle for cash some or all of their Series 1 Redeemable Preferred Stock, in each case at the Series 1 Redemption Price, in the following circumstances:

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Pursuant to the SoFi Technologies Certificate of Incorporation, the Series 1 preferred stockholders do not have explicit board of director rights.

In connection with the Series 1 and Series H preferred stock issuances during the year ended December 31, 2019, we also issued 12,170,990 Series H warrants, which were initially accounted for as liabilities in accordance with ASC 480, and were included within accounts payable, accruals and other liabilities in the consolidated balance sheets.

At inception, we allocated $ 22.3 million of the $ 539.0 million of proceeds we received from the Series 1 and Series H preferred stock issuances to the Series H warrants (which was reduced by $ 2.4 million of direct costs), with such valuation determined using the Black-Scholes Model, in order to establish an initial fair value for the Series H warrants.

The remaining proceeds were allocated to the Series 1 and Series H preferred stock balances based on their initial relative fair values.

This resulted in an initial allocation of $ 193.9 million and $ 320.4 million to the Series H and Series 1 preferred stock, respectively.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

payable, accruals and other liabilities in the consolidated balance sheets.

The Series H preferred stock was converted into shares of SoFi Technologies common stock in conjunction with the Business Combination.

Subsequent to the initial measurement and until the Business Combination, the Series H warrants were measured at fair value on a recurring basis and classified as Level 3 because of our reliance on unobservable assumptions, with fair value changes recognized within noninterest expense—general and administrative in the consolidated statements of operations and comprehensive income (loss).

Prior to the Business Combination, the Series H warrants were measured at fair value on a recurring basis and classified as Level 3 because of our reliance on unobservable assumptions, with fair value changes recognized within noninterest expense—general and administrative in the consolidated statements of operations and comprehensive income (loss).

On May 28, 2021, in conjunction with the Closing of the Business Combination, we measured the final fair value of our Series H warrants.

1 unchanged sentence

Therefore, we did not measure the warrants at fair value subsequent to May 28, 2021.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

The key inputs into our Black-Scholes Model valuation as of December 31, 2020 and as of May 28, 2021, the final measurement date, were as follows:

Input May 28, 2021 December 31, 2020

The key inputs into our Black-Scholes Model valuation as of May 28, 2021, the final measurement date, were as follows:

Input May 28, 2021

Risk-free interest rate 0.3 %

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The Company’s use of the Black-Scholes Model required the use of subjective assumptions:

• The risk-free interest rate assumption was initially based on the five-year U.S.

• Risk-free interest rate — Based on the five-year U.S.

Treasury rate, which was commensurate with the expected term of the warrants.

2 unchanged sentences

An increase in the expected term, in isolation, would typically correlate to a higher risk-free interest rate and result in an increase in the fair value measurement of the warrant liabilities and vice versa.

See below for a development in connection with the Business Combination.

• Our expected volatility assumptions reflected the expectation that the Series H warrants would convert into common stock upon consummation of the Business Combination, and the Series H preference would be of no further effect, in which case the Series H preference would not have a material impact on the stock volatility measure.

As such, the expected volatility assumptions reflect our common stock volatilities as of May 28, 2021 and December 31, 2020.

• Expected volatility — Reflected the expectation that the Series H warrants would convert into common stock upon consummation of the Business Combination, and the Series H preference would be of no further effect, in which case the Series H preference would not have a material impact on the stock volatility measure.

As such, the expected volatility assumptions reflect our common stock volatilities as of May 28, 2021.

An increase in the expected volatility, in isolation, would result in an increase in the fair value measurement of the warrant liabilities and vice versa.

• The fair value measurement of the Series H preferred stock as of December 31, 2020 was informed from a common stock transaction during December 2020 at a price of $ 10.57 per common share.

We determined that this common stock transaction was a reasonable proxy for the valuation of the Series H preferred stock as of December 31, 2020 due to the proximity to an expected Business Combination;

• Fair value of Series H preferred stock — Determined as of May 28, 2021, which was informed from a common stock transaction during December 2020 at a price of $ 10.57 per common share.

We determined that this common stock transaction was a reasonable proxy for the valuation of the Series H preferred stock as of May 28, 2021 due to the proximity to an expected Business Combination;

therefore, other than adjusting for the Series H exchange ratio, no further adjustments were made for the Series H concluded price per share.

As of May 28, 2021, the fair value measurement of the Series H redeemable preferred stock was determined based on the observable closing price of SCH stock (ticker symbol “IPOE”) on the measurement date multiplied by the weighted average exchange ratio of the Series H preferred stock.

• We assumed no dividend yield because we have historically not paid out dividends to our preferred stockholders, other than to the Series 1 preferred stockholders, which is considered a special circumstance.

The following table presents the changes in the fair value of the Series H warrant liabilities during the periods prior to the Closing of the Business Combination.

• Dividend yield — We assumed no dividend yield because we have historically not paid out dividends to our preferred stockholders, other than to the Series 1 preferred stockholders, which is considered a special circumstance.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

The following table presents the changes in the fair value of the Series H warrant liabilities during the year ended December 31, 2021, prior to the Closing of the Business Combination.

Warrant Liabilities

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Change in valuation inputs or other assumptions (1)

Fair value as of December 31, 2020 $ 39,959

Change in valuation inputs or other assumptions (1)

Reclassification to permanent equity in conjunction with the Business Combination (2)

2 unchanged sentences

(1) Changes in valuation inputs or other assumptions are recognized within noninterest expense—general and administrative in the consolidated statements of operations and comprehensive income (loss).

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

(2) Upon the Closing of the Business Combination, Social Finance Series H warrants were converted into SoFi Technologies common stock warrants and reclassified to permanent equity, as the warrants no longer had features requiring liability based accounting and, therefore, represented a non-cash activity.

Permanent Equity

On June 1, 2021, the Company’s common stock and warrants began trading on the Nasdaq Global Select Market under the ticker symbols “SOFI” and “SOFIW”, respectively.

On June 1, 2021, the Company’s common stock began trading on the Nasdaq Global Select Market under the ticker symbol “SOFI”.

Pursuant to SoFi Technologies’ Certificate of Incorporation, the Company is authorized to issue 3,000,000,000 shares of common stock, with a par value of $ 0.0001 per share, and 100,000,000 shares of non-voting common stock, with a par value of $ 0.0001 per share.

As of December 31, 2022, the Company had 933,896,120 shares of common stock and no shares of non-voting common stock issued and outstanding.

See Note 11 for additional information on Social Finance preferred stock that was converted into SoFi Technologies common stock in conjunction with the Business Combination.

During December 2020, we issued 34,973,294 shares of common stock for gross proceeds received of $ 369.8 million, which was offset by direct legal costs of $ 56 (the “Common Stock Issuance”).

The number of shares issued in the Common Stock Issuance was subject to upward adjustment if we consummated the Business Combination described in Note 2, with the amount of the adjustment based on the implied per-share consideration in the Business Combination and the number of shares of our capital stock issued in certain dilutive issuances prior to the Closing of the Business Combination.

The adjustment resulted in the issuance of an additional 1,281,132 shares at the time of the Closing of the Business Combination.

The Company reserved the following common stock for future issuance as of the dates indicated:

The Company reserved the following common stock for future issuance:

Outstanding stock options, RSUs and PSUs 107,851,565 92,829,067

1 unchanged sentence

Conversion of Convertible Notes (1)

53,538,000 53,538,000

Possible future issuance under stock plans 26,434,957 32,470,481

Conversion of outstanding redeemable preferred stock — 465,916,522

Unissued redeemable preferred stock reserved for issued warrants — 12,170,990

Unissued redeemable preferred stock — 86,925,094

Contingent common stock — 320,649

Total common stock reserved for future issuance 199,995,512 191,008,538

_____________________

(1) As of December 31, 2021, represented the number of common stock issuable upon conversion of all Convertible Notes at the conversion rate in effect at the balance sheet date, in accordance with ASU 2020-06.

See Note 1 and Note 10 for additional information.

Common stockholders and non-voting common stockholders are entitled to dividends when and if declared by the Board of Directors .

(1) Represents the number of common stock issuable upon conversion of all Convertible Notes at the conversion rate in effect at the balance sheet date.

Common stockholders and non-voting common stockholders are entitled to dividends when and if declared by the Board of Directors and subject to government regulation over banks and bank holding companies, as discussed further in Note 21.

There were no dividends declared or paid to common stockholders during the years ended December 31, 2022, 2021 and 2020.

5 unchanged sentences

The Capped Call Transactions initially cover, subject to customary anti-dilution adjustments, the number of shares of our common stock that initially underlie the Convertible Notes.

The Capped Call Transactions are expected generally to reduce the potential dilutive effect on the common stock upon any conversion of Convertible Notes and/or offset any potential cash payments we

The Capped Call Transactions are expected generally to reduce the potential dilutive effect on the common stock upon any conversion of Convertible Notes and/or offset any potential cash payments we are required to make in excess of the principal amount of converted Convertible Notes, as the case may be, with such reduction and/or offset subject to a cap, subject to certain adjustments under the terms of the Capped Call Transactions.

The Capped Call Transactions allow the Company to purchase shares of our common stock at a strike price equal to the initial conversion price

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

are required to make in excess of the principal amount of converted Convertible Notes, as the case may be, with such reduction and/or offset subject to a cap, subject to certain adjustments under the terms of the Capped Call Transactions.

The Capped Call Transactions allow the Company to purchase shares of our common stock at a strike price equal to the initial conversion price of approximately $ 22.41 per share, and are subject to a cap of $ 32.02 per share, subject to certain adjustments under the terms of the Capped Call Transactions.

of approximately $ 22.41 per share, and are subject to a cap of $ 32.02 per share, subject to certain adjustments under the terms of the Capped Call Transactions.

Capped Call Transactions are subject to automatic exercise if they are in-the-money as of certain expiration dates during September and October 2026.

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Accumulated Other Comprehensive Income (Loss)

Accumulated other comprehensive income (loss) (“AOCI”) primarily consists of accumulated net unrealized gains or losses associated with our investments in AFS debt securities, which commenced during the third quarter of 2021, and foreign currency translation adjustments, which historically have been immaterial.

The following table presents the rollforward of AOCI, inclusive of the changes in the components of other comprehensive income (loss) for the years indicated.

AOCI primarily consists of accumulated net unrealized gains or losses associated with our investments in AFS debt securities and foreign currency translation adjustments.

The following table presents the rollforward of AOCI, inclusive of the changes in the components of other comprehensive loss:

AFS Debt Securities Foreign Currency Translation Adjustments Total

Year Ended December 31, 2021

AOCI, beginning balance $ — $ ( 166 ) $ ( 166 )

Balance at January 1, 2020 $ — $ ( 21 ) $ ( 21 )

Other comprehensive loss before reclassifications (1)

— ( 145 ) ( 145 )

Net current-period other comprehensive loss (2)

— ( 145 ) ( 145 )

Balance at December 31, 2020

$ — $ ( 166 ) $ ( 166 )

Other comprehensive loss before reclassifications (1)

( 1,459 ) 46 ( 1,413 )

Amounts reclassified from AOCI into earnings 108 — 108

Net current-period other comprehensive loss (2)

( 1,351 ) 46 ( 1,305 )

Balance at December 31, 2021

$ ( 1,351 ) $ ( 120 ) $ ( 1,471 )

Other comprehensive income (loss) before reclassifications (1)

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( 7,260 ) 435 ( 6,825 )

AOCI, ending balance $ ( 1,351 ) $ ( 120 ) $ ( 1,471 )

Balance at December 31, 2022

$ ( 8,611 ) $ 315 $ ( 8,296 )

_____________________

(1) Gross realized gains and losses from sales of our investments in AFS debt securities that were reclassified from AOCI to earnings are recorded within noninterest income—other in the consolidated statements of operations and comprehensive income (loss).

There were no reclassifications related to foreign currency translation adjustments during the years ended December 31, 2022 and 2021.

(2) There were no material tax impacts during any of the years presented due to reserves against deferred tax assets in jurisdictions where other comprehensive loss activity was generated.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

Derivative Financial Instruments

The following table presents the gains (losses) recognized on our derivative instruments:

Year Ended December 31,

AOCI, beginning balance $ — $ ( 21 ) $ ( 21 )

Other comprehensive loss before reclassifications (1)

2022 2021 2020

Net current-period other comprehensive loss (2)

Derivative contracts to manage future loan sale execution risk (1)(2)

$ 354,834 $ 49,090 $ ( 54,829 )

AOCI, ending balance $ — $ ( 166 ) $ ( 166 )

Derivative contracts to manage securitization investment interest rate risk (3)

Purchase price earn-out (1)(4)

1,094 9,312 —

We did not have investments in AFS debt securities during the year ended December 31, 2020.

Additionally, there were no reclassifications related to foreign currency translation adjustments during the years ended December 31, 2021 and 2020.

(2) There were no tax impacts during the years presented due to reserves against deferred tax assets in jurisdictions where other comprehensive income activity was generated.

For gross amounts of realized gains and losses on our investments in AFS debt securities, see Note 4.

Interest income associated with our investments in AFS debt securities recognized within interest income—other during the year ended December 31, 2021 was immaterial.

( 3,543 ) ( 11,861 ) 14,530

Interest rate caps (1)

( 8,583 ) ( 193 ) —

Third party warrants (5)

Special payment (6)

— ( 21,181 ) —

Derivative contracts to manage market risk associated with non-securitization investments (7)

$ 358,845 $ 25,740 $ ( 39,303 )

_____________________

(1) Recorded within noninterest income—loan origination and sales in the consolidated statements of operations and comprehensive income (loss).

(2) The loss recognized during the year ended December 31, 2020 was inclusive of a $ 22,269 gain on credit default swaps that were opened and settled during the year.

(3) Recorded within noninterest income—securitizations in the consolidated statements of operations and comprehensive income (loss).

(4) In conjunction with a loan sale agreement, we are entitled to receive payments from the buyer of the loans underlying the agreement if the internal rate of return (as defined in the loan sale agreement) on such loans exceeds a specified hurdle, subject to a dollar cap.

(5) Includes amounts recorded within noninterest income—other, noninterest expense—cost of operations and noninterest expense—general and administrative in the consolidated statements of operations and comprehensive income (loss), the latter of which represents the amortization of a deferred liability recognized at the initial fair value of the third party warrants acquired, as we are also a customer of the third party.

(6) In conjunction with the Business Combination, we made a one-time special payment to the holders of Series 1 Redeemable Preferred Stock, which was paid from the proceeds of the Business Combination and settled contemporaneously with the Business Combination.

The Series 1 Redeemable Preferred Stock has no stated maturity.

(7) Recorded within noninterest income—other in the consolidated statements of operations and comprehensive income (loss).

The following table presents information about derivative instruments subject to enforceable master netting arrangements:

December 31, 2022 December 31, 2021

Gross Derivative Assets Gross Derivative Liabilities Gross Derivative Assets Gross Derivative Liabilities

Interest rate swaps $ 23,128 $ — $ 5,444 $ —

Interest rate caps — ( 9,251 ) — ( 668 )

Home loan pipeline hedges 1,484 ( 80 ) 117 ( 313 )

Total, gross $ 24,612 $ ( 9,331 ) $ 5,561 $ ( 981 )

Derivative netting ( 80 ) 80 ( 117 ) 117

Total, net (1)

$ 24,532 $ ( 9,251 ) $ 5,444 $ ( 864 )

_____________________

(1) We did not have a cash collateral requirement related to these instruments as of December 31, 2022.

As of December 31, 2021, we had an immaterial cash collateral requirement.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

The following table presents the notional amount of derivative contracts outstanding:

Derivative contracts to manage future loan sale execution risk:

Interest rate swaps $ 5,638,177 $ 4,210,000

Interest rate caps 405,000 405,000

Home loan pipeline hedges 126,000 421,000

Interest rate caps (1)

405,000 405,000

Interest rate swaps (2)

82,335 357,529

Total $ 6,828,335 $ 5,798,529

_____________________

(1) We sold an interest rate cap that was subject to master netting to offset an interest rate cap purchase made in conjunction with a contract to manage future loan sale execution risk.

(2) Represents interest rate swaps utilized to manage interest rate risk associated with certain of our securitization investments.

(3) Amounts correspond with home loan funding commitments subject to IRLC agreements.

See Note 1 and 15 for additional information on our derivative assets and liabilities.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

Fair Value Measurements

Recurring Fair Value Measurements

The following table summarizes, by level within the fair value hierarchy, the estimated fair values of our assets and liabilities measured at fair value on a recurring basis in the consolidated balance sheets:

December 31, 2022 December 31, 2021

Fair Value Fair Value

Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total

Investments in AFS debt securities (1)(2)

$ 137,032 $ 58,406 $ — $ 195,438 $ 129,835 $ 65,072 $ — $ 194,907

Asset-backed bonds (2)(3)

— 155,093 — 155,093 — 253,669 — 253,669

Residual investments (2)(3)

— — 46,238 46,238 — — 121,019 121,019

Loans at fair value — — 13,557,074 13,557,074 — — 5,952,972 5,952,972

Servicing rights — — 149,854 149,854 — — 168,259 168,259

Non-securitization investments – ETFs (4)

— — — — 1,486 — — 1,486

Third party warrants (4)(5)

— — 630 630 — — 1,369 1,369

Derivative assets (4)(6)(7)

— 24,612 — 24,612 — 5,444 — 5,444

Purchase price earn-out (4)(8)

— — 54 54 — — 4,272 4,272

— — 216 216 — — 3,759 3,759

Student loan commitments (4)(9)

— — — — — — 2,220 2,220

Interest rate caps (4)(7)

— 9,178 — 9,178 — 493 — 493

Digital assets safeguarding asset (4)(10)

— 106,826 — 106,826 — — — —

Total assets $ 137,032 $ 354,115 $ 13,754,066 $ 14,245,213 $ 131,321 $ 324,678 $ 6,253,870 $ 6,709,869

$ — $ 89,142 $ — $ 89,142 $ — $ — $ — $ —

Residual interests classified as debt — — 17,048 17,048 — — 93,682 93,682

Derivative liabilities (4)(6)(7)

— 9,331 — 9,331 196 668 — 864

Student loan commitments (4)(9)

— — 236 236 — — — —

Digital assets safeguarding liability (4)(10)

— 106,826 — 106,826 — — — —

Total liabilities $ — $ 205,299 $ 17,284 $ 222,583 $ 196 $ 668 $ 93,682 $ 94,546

_____________________

(1) The investments in AFS debt securities that were classified as Level 2 rely upon observable inputs other than quoted prices, dealer quotes in markets that are not active and implied pricing derived from new issuances of similar securities.

See Note 6 for additional information.

(2) These assets are presented within investment securities in the consolidated balance sheets.

(3) These assets represent the carrying value of our holdings in VIEs wherein we were not deemed the primary beneficiary.

See Note 6 for additional information.

We classify asset-backed bonds as Level 2 due to the use of quoted prices for similar assets in markets that are not active, as well as certain factors specific to us.

The key inputs used to value the asset-backed bonds include the discount rate and conditional prepayment rate.

The fair value of our asset-backed bonds was not materially impacted by default assumptions on the underlying securitization loans, as the subordinate residual interests are expected to absorb all estimated losses based on our default assumptions for the period.

We classify the residual investments as Level 3 due to the reliance on significant unobservable valuation inputs.

(4) These assets and liabilities are presented within other assets and accounts payable, accruals and other liabilities , respectively, in the consolidated balance sheets.

(5) The key unobservable assumption used in the fair value measurement of the third party warrants was the price of the stock underlying the warrants.

The fair value was measured as the difference between the stock price and the strike price of the warrants.

As the strike price was insignificant, we concluded that the impact of time value on the fair value measure was immaterial.

(6) For certain derivative instruments for which an enforceable master netting agreement exists, we elected to net derivative assets and derivative liabilities by counterparty.

These instruments are presented on a gross basis herein.

See Note 1 and Note 14 for additional information.

(7) Home loan pipeline hedges represent TBAs used as economic hedges of loan fair values and are classified as Level 2, as we rely on quoted market prices from similar loan pools that transact in the marketplace.

Interest rate swaps and interest rate caps are classified as Level 2, because these financial instruments do not trade in active markets with observable prices, but rely on observable inputs other than quoted prices.

As of December 31, 2022, interest rate swaps and interest rate caps were valued using the overnight SOFR curve and the implied volatilities suggested by the SOFR rate curve.

As of December 31, 2021, interest rate swaps were valued using the three-month LIBOR swap yield curve.

These were determined to be observable inputs from active markets.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

(8) The purchase price earn-out provision is classified as Level 3 because of our reliance on unobservable inputs related to the underlying loan portfolio performance, such as conditional prepayment rates, annual default rates and discount rates.

(9) IRLCs and student loan commitments are classified as Level 3 because of our reliance on assumed loan funding probabilities.

The assumed probabilities are based on our internal historical experience with home loans and student loans similar to those in the funding pipelines on the measurement date.

(10) The digital assets safeguarding liability and corresponding safeguarding asset are classified as Level 2, because they do not trade in active markets, and are valued using quoted prices on an active exchange that has been identified as the principal market for the underlying digital assets that are being held by our third-party custodians for the benefit of our members.

(11) The fair value of our securitization debt was classified as Level 2 and valued using a discounted cash flow model, with key inputs relating to the underlying contractual coupons, terms, discount rate and expectations for defaults and prepayments.

As of December 31, 2022, the unpaid principal related to debt measured at fair value was $ 98,868 .

For the year ended December 31, 2022, losses from changes in fair value were $ 586 .

The estimated amounts of gains (losses) included in earnings attributable to changes in instrument-specific credit risk, which were derived principally from observable changes in credit spread as observed in the bond market, were immaterial.

Level 3 Recurring Fair Value Rollforward

The following tables present the changes in our assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3).

We did not have any transfers into or out of Level 3 during the years presented.

Fair Value at Fair Value at

January 1, 2022 Impact on Earnings Purchases Sales Issuances Settlements December 31, 2022

Personal loans $ 2,289,426 $ 103,746 $ 1,677,682 $ ( 2,911,491 ) $ 9,773,705 $ ( 2,322,634 ) $ 8,610,434

Student loans 3,450,837 ( 24,166 ) 817,864 ( 877,920 ) 2,245,499 ( 734,937 ) 4,877,177

Home loans 212,709 ( 10,840 ) 2,901 ( 1,094,981 ) 966,177 ( 6,503 ) 69,463

Loans at fair value (1)

5,952,972 68,740 2,498,447 ( 4,884,392 ) 12,985,381 ( 3,064,074 ) 13,557,074

Servicing rights 168,259 39,651 3,712 ( 22,020 ) 45,126 ( 84,874 ) 149,854

Residual investments (2)

121,019 2,240 — ( 36,732 ) — ( 40,289 ) 46,238

Purchase price earn out 4,272 1,094 — — — ( 5,312 ) 54

3,759 ( 2,630 ) — — — ( 913 ) 216

Third party warrants 1,369 ( 739 ) — — — — 630

Total assets $ 6,251,650 $ 108,356 $ 2,502,159 $ ( 4,943,144 ) $ 13,030,507 $ ( 3,195,462 ) $ 13,754,066

Residual interests classified as debt (2)

$ ( 93,682 ) $ ( 6,608 ) $ — $ — $ — $ 83,242 $ ( 17,048 )

Student loan commitments (3)

2,220 ( 1,876 ) — — — ( 580 ) ( 236 )

Total liabilities $ ( 91,462 ) $ ( 8,484 ) $ — $ — $ — $ 82,662 $ ( 17,284 )

Net impact on earnings $ 99,872

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

Fair Value at Fair Value at

January 1, 2021 Impact on Earnings Purchases Sales Issuances Settlements December 31, 2021

Personal loans $ 1,812,920 $ 29,022 $ 405,051 $ ( 4,290,424 ) $ 5,386,934 $ ( 1,054,077 ) $ 2,289,426

Student loans 2,866,459 ( 6,231 ) 44,850 ( 2,854,778 ) 4,293,526 ( 892,989 ) 3,450,837

Home loans 179,689 ( 5,124 ) 1,144 ( 2,935,038 ) 2,978,222 ( 6,184 ) 212,709

Loans at fair value (1)

4,859,068 17,667 451,045 ( 10,080,240 ) 12,658,682 ( 1,953,250 ) 5,952,972

Servicing rights 149,597 ( 2,651 ) 370 ( 1,052 ) 111,582 ( 89,587 ) 168,259

Residual investments (2)

139,524 10,603 — ( 4,291 ) 49,317 ( 74,134 ) 121,019

15,620 23,211 — — — ( 35,072 ) 3,759

Purchase price earn out — 2,147 — — 7,165 ( 5,040 ) 4,272

Student loan commitments (3)

— 6,410 — — — ( 4,190 ) 2,220

Third party warrants — 573 — — 796 — 1,369

Total assets $ 5,163,809 $ 57,960 $ 451,415 $ ( 10,085,583 ) $ 12,827,542 $ ( 2,161,273 ) $ 6,253,870

Residual interests classified as debt (2)

$ ( 118,298 ) $ ( 22,802 ) $ — $ — $ ( 2,170 ) $ 49,588 $ ( 93,682 )

Total liabilities $ ( 118,298 ) $ ( 22,802 ) $ — $ — $ ( 2,170 ) $ 49,588 $ ( 93,682 )

Net impact on earnings $ 35,158

_____________________

(1) For loans at fair value, issuances represent the principal balance of loans originated during the year.

Purchases reflect unpaid principal balance and relate to previously transferred loans or additions of loans to consolidated securitizations.

Purchase activity during the years ended December 31, 2022 and 2021 included securitization clean-up calls of $ 518,659 and $ 425,302 , respectively.

Additionally, during the years ended December 31, 2022 and 2021, we elected to purchase $ 1,843,575 and $ 17,596 , respectively, of previously sold loans from certain investors.

We were not required to buy back these loans.

The remaining purchases during the years presented related to standard representations and warranties pursuant to our various loan sale agreements.

Gains and losses recognized in earnings include changes in accumulated interest and fair value adjustments on loans originated during the year and on loans held at the balance sheet date, as well as loan charge-offs.

Changes in fair value are impacted by valuation assumption changes, as well as sales price execution and amount of time the loans are held prior to sale.

The estimated amount of gains (losses) included in earnings attributable to changes in instrument-specific credit risk were $( 49,453 ), $ 4,143 and $ 13,896 during the years ended December 31, 2022, 2021 and 2020, respectively.

The gains (losses) attributable to instrument-specific credit risk were estimated by incorporating our current default and loss severity assumptions for the loans.

These assumptions are based on historical performance, market trends and performance expectations over the term of the underlying instrument.

(2) For residual investments, sales include the derecognition of investments associated with securitization clean up calls.

The estimated amounts of gains and losses for residual investments included in earnings attributable to changes in instrument-specific credit risk were immaterial during the years presented.

For residual investments and residual interests classified as debt, we record changes in fair value within noninterest income—securitizations in the consolidated statements of operations and comprehensive income (loss), a portion of which is subsequently reclassified to interest expense—securitizations and warehouses for residual interests classified as debt and to interest income—securitizations for residual investments, but does not impact the liability or asset balance, respectively.

(3) For IRLCs and student loan commitments, settlements reflect funded and unfunded adjustments representing the unpaid principal balance of funded and unfunded loans during the quarter multiplied by the IRLC or student loan commitment price in effect at the beginning of the quarter.

For the year-to-date periods, amounts represent the summation of the per-quarter effects.

Changes in fair value are recorded within noninterest income—loan origination and sales in the consolidated statements of operations and comprehensive income (loss).

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

Level 3 Significant Inputs

The following key unobservable assumptions were used in the fair value measurement of our loans:

December 31, 2022 December 31, 2021

Range Weighted Average Range Weighted Average

Personal loans

Conditional prepayment rate 17.3 % – 25.5 %

19.1 % 18.4 % – 37.7 %

Annual default rate 3.8 % – 37.7 %

4.4 % 4.2 % – 30.0 %

Discount rate 5.4 % – 8.3 %

6.1 % 3.9 % – 7.0 %

Student loans

Conditional prepayment rate 16.3 % – 21.8 %

20.4 % 16.5 % – 26.3 %

Annual default rate 0.2 % – 4.5 %

0.5 % 0.2 % – 4.2 %

Discount rate 3.6 % – 8.7 %

4.0 % 1.9 % – 7.1 %

Conditional prepayment rate 2.0 % – 10.2 %

7.0 % 4.8 % – 16.4 %

Annual default rate 0.1 % – 1.3 %

0.1 % 0.1 % – 0.2 %

Discount rate 5.7 % – 14.1 %

5.9 % 2.5 % – 13.0 %

The key assumptions are defined as follows:

• Conditional prepayment rate — The monthly annualized proportion of the principal of a pool of loans that is assumed to be paid off prematurely in each period.

An increase in the conditional prepayment rate, in isolation, would result in a decrease in a fair value measurement.

The weighted average assumption was weighted based on relative fair value.

• Annual default rate — The annualized rate of borrowers who do not make loan payments on time.

An increase in the annual default rate, in isolation, would result in a decrease in a fair value measurement.

The weighted average assumption was weighted based on relative fair value.

• Discount rate — The weighted average rate at which the expected cash flows are discounted to arrive at the net present value of the loans.

The discount rate is primarily determined based on the federal funds rate, our weighted average coupon rate and expected duration of the assets, the last of which is also impacted by expected prepayment rates.

An increase in the discount rate, in isolation, would result in a decrease in a fair value measurement.

The weighted average assumption was weighted based on relative fair value.

See Note 4 for additional loan fair value disclosures.

Servicing Rights

Servicing rights for personal loans and student loans do not trade in an active market with readily observable prices.

Similarly, home loan servicing rights infrequently trade in an active market.

Management classifies servicing rights as Level 3 due to the use of significant unobservable inputs in the fair value measurement.

SoFi Technologies, Inc.

Notes to Consolidated Financial Statements (continued)

(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

The following key unobservable inputs were used in the fair value measurement of our classes of servicing rights:

December 31, 2022 December 31, 2021

Range Weighted Average Range Weighted Average

Personal loans

Market servicing costs 0.2 % – 0.5 %

0.3 % 0.2 % – 1.1 %

Conditional prepayment rate 17.9 % – 31.3 %

22.7 % 22.5 % – 41.4 %

Annual default rate 3.4 % – 7.9 %

4.9 % 3.2 % – 7.0 %

Discount rate 7.8 % – 7.8 %

7.8 % 7.3 % – 7.3 %

Student loans

Market servicing costs 0.1 % – 0.2 %

0.1 % 0.1 % – 0.2 %

Conditional prepayment rate 15.4 % – 21.9 %

17.8 % 15.2 % – 25.6 %

Annual default rate 0.3 % – 4.3 %

0.4 % 0.2 % – 4.3 %

Discount rate 7.8 % – 7.8 %

7.8 % 7.3 % – 7.3 %

Market servicing costs 0.1 % – 0.1 %

0.1 % 0.1 % – 0.1 %

Conditional prepayment rate 4.9 % – 11.0 %

5.2 % 10.0 % – 16.4 %

Annual default rate 0.1 % – 0.1 %

0.1 % 0.1 % – 0.2 %

Discount rate 9.0 % – 9.0 %

9.0 % 7.5 % – 7.5 %

The key assumptions are defined as follows:

• Market servicing costs — The fee a willing market participant, which we validate through actual third-party bids for our servicing, would require for the servicing of personal loans, student loans and home loans with similar characteristics as those in our serviced portfolio.