VersaBank (VBNK.TO), up 2.6% in U.S. pre-market trading, on Thursday said its U.S. subsidiary has struck a deal with its second US Receivable Purchase Program (RPP) partner who will use VersaBank's RPP to fund a portion of its loan and lease originations.

VersaBank's US RPP portfolio has surpassed US$70 million in assets since adding its first partner on Jan. 30 and remains on target to achieve US$290 million in US RPP in fiscal 2025.

Net interest margin(NIM) for the first two months of the second quarter of fiscal 2025 has expanded meaningfully, VersaBank said, adding that this is due to several factors, including normalization of the yield curve (benefitting Canadian RPP yields), continued expansion of Insolvency Professional deposits (as bankruptcies in Canada increase), and the addition of higher margin US RPP assets.

BMO Nesbitt Burns has also joined VersaBank's deposit broker network, which is expected to contribute to expansion of VersaBank's NIM in fiscal 2025.

The company's shares were last seen up US$0.25, to US$9.99, in New York ppre-market trading.

The Bank remains on track to reach its target of $1 billion of commitments in Canada Mortgage and Housing Corporation (CMHC)-insured loans by the end of fiscal 2025. As of April 15, CMHC-insured loan commitments increased to over $730 million, with $266 million in loans outstanding. CMHC-insured loans are zero risk-weighted loans which require no risk weighted capital and generate an attractive spread favourably contributing to credit asset net interest margin, VersaBank noted.