Medallion Bank Reports 2022 Second Quarter Results and Declares Series F Preferred Stock Dividend
SALT LAKE CITY, July 27, 2022 (GLOBE NEWSWIRE) -- Medallion Bank (Nasdaq: MBNKP, the “Bank”), an FDIC-insured bank providing consumer loans for the purchase of recreational vehicles, boats, and home improvements, along with offering loan origination services to fintech strategic partners, announced today its results for the period ended June 30, 2022. The Bank is a wholly owned subsidiary of Medallion Financial Corp. (Nasdaq: MFIN).
2022 Second Quarter Highlights
Net income of $17.9 million, compared to net income of $17.5 million in the prior year period.
Net interest income of $40.0 million with a net interest margin of 9.5%, compared to $33.1 million and 10.0% in the prior year period.
Annualized ROA and ROE were 4.2% and 25.9%, respectively, as of June 30, 2022, compared to 5.2% and 30.0% in the prior year period.
Provision for loan losses was $6.0 million, compared to a benefit of $0.4 million in the prior year period.
Annualized net charge-offs were 0.2% of average loans outstanding, compared to 3.9% in the prior year period.
The total loan portfolio grew 28.5% to $1.6 billion during the 12-month period ending June 30, 2022.
Total assets were $1.8 billion, total capital was $282.9 million, and the Tier 1 leverage ratio was 17.0% at June 30, 2022.
Donald Poulton, President and Chief Executive Officer of Medallion Bank, stated, “We recorded another quarter of substantial earnings, driven by record loan originations on sustained demand for our products that serve the recreation vehicle, marine, and home improvement industries. Despite rising interest rates and inflationary pressure, our borrowers continued to perform well and loan losses remained lower than historical norms. While the provision for loan losses grew year-over-year commensurate with loan growth, net recoveries of $2.3 million in our medallion loan portfolio were a helpful offset. We continue to focus on serving our customers with an optimal balance of high tech and high touch in order to deliver superior financial performance.”
Recreation Lending Segment
The Bank’s recreation loan portfolio grew 23.2% to $1.1 billion as of June 30, 2022, compared to $891.6 million at June 30, 2021.
Net interest income was $30.3 million, compared to $26.0 million in the prior year period.
Recreation loans were 67.1% of loans receivable as of June 30, 2022, compared to 69.9% at June 30, 2021.
The provision for recreation loan losses was $6.7 million, compared to $1.0 million in the prior year period.
Annualized net charge-offs were 1.0% of average recreation loans outstanding, compared to annualized net recoveries of 0.2% in the prior year period.
Home Improvement Lending Segment
The Bank’s home improvement loan portfolio grew 42.9% to $526.3 million as of June 30, 2022, compared to $368.4 million at June 30, 2021.
Net interest income was $9.4 million, compared to $7.3 million in the prior year period.
Home improvement loans were 32.1% of loans receivable as of June 30, 2022, compared to 28.9% at June 30, 2021.
The provision for home improvement loan losses was $1.7 million, compared to $0.7 million in the prior year period.
Annualized net charge-offs were 0.5% of average home improvement loans outstanding, compared to 0.3% in the prior year period.
Series F Preferred Stock Dividend
On July 26, 2022, the Bank’s Board of Directors declared a quarterly cash dividend of $0.50 per share on the Bank’s Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock, Series F, which trades on the Nasdaq Capital Market under the ticker symbol “MBNKP.” The dividend is payable on October 3, 2022, to holders of record at the close of business on September 15, 2022.
About Medallion Bank
Medallion Bank specializes in providing consumer loans for the purchase of recreational vehicles, boats, and home improvements, along with offering loan origination services to fintech strategic partners. The Bank works directly with thousands of dealers, contractors and financial service providers serving their customers throughout the United States. Medallion Bank is a Utah-chartered, FDIC-insured industrial bank headquartered in Salt Lake City and is a wholly owned subsidiary of Medallion Financial Corp. (Nasdaq: MFIN).
For more information, visit www.medallionbank.com
Please note that this press release contains forward-looking statements that involve risks and uncertainties relating to business performance, cash flow, costs, sales, net investment income, earnings, returns and growth. These statements are often, but not always, made through the use of words or phrases such as “continue,” “believe,” or “will,” or the negative version of those words or other comparable words or phrases of a future or forward-looking nature, such as “sustain.” These statements relate to our future earnings, returns, growth prospects, asset quality and pursuit and execution of our strategy. Medallion Bank’s actual results may differ significantly from the results discussed in such forward-looking statements. For a description of certain risks to which Medallion Bank is or may be subject, please refer to the factors discussed under the captions “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” included in Medallion Bank’s Form 10-K for the year ended December 31, 2021, and in its Quarterly Reports on Form 10-Q, filed with the FDIC. Medallion Bank’s Form 10-K, Form 10-Qs and other FDIC filings are available in the Investor Relations section of Medallion Bank’s website. In addition, Medallion Bank’s financial results for any period are not necessarily indicative of Medallion Financial Corp.’s results for the same period.
Company Contact:
Investor Relations
212-328-2176
InvestorRelations@medallion.com
MEDALLION BANK | |||||||||||||||
| For the Three Months Ended June 30, |
| For the Six Months Ended June 30, | ||||||||||||
(In thousands) |
| 2022 |
|
|
| 2021 |
|
|
| 2022 |
|
|
| 2021 |
|
Total interest income | $ | 44,905 |
|
| $ | 37,594 |
|
| $ | 86,249 |
|
| $ | 73,350 |
|
Total interest expense |
| 4,912 |
|
|
| 4,465 |
|
|
| 9,066 |
|
|
| 9,176 |
|
Net interest income |
| 39,993 |
|
|
| 33,129 |
|
|
| 77,183 |
|
|
| 64,174 |
|
|
|
|
|
|
|
|
| ||||||||
Provision (benefit) for loan losses |
| 5,986 |
|
|
| (374 | ) |
|
| 8,130 |
|
|
| 2,364 |
|
Net interest income after provision for loan losses |
| 34,007 |
|
|
| 33,503 |
|
|
| 69,053 |
|
|
| 61,810 |
|
|
|
|
|
|
|
|
| ||||||||
Other (loss) income |
|
|
|
|
|
|
| ||||||||
Write-downs of loan collateral in process of foreclosure |
| (54 | ) |
|
| (1,424 | ) |
|
| (440 | ) |
|
| (2,552 | ) |
Other non-interest income |
| 392 |
|
|
| 442 |
|
|
| 548 |
|
|
| 536 |
|
Total non-interest loss, net |
| 338 |
|
|
| (982 | ) |
|
| 108 |
|
|
| (2,016 | ) |
|
|
|
|
|
|
|
| ||||||||
Non-interest expense |
|
|
|
|
|
|
| ||||||||
Salaries and benefits |
| 3,466 |
|
|
| 2,798 |
|
|
| 6,971 |
|
|
| 5,602 |
|
Loan servicing |
| 2,787 |
|
|
| 2,704 |
|
|
| 5,456 |
|
|
| 5,352 |
|
Collection costs |
| 1,319 |
|
|
| 1,120 |
|
|
| 2,478 |
|
|
| 2,135 |
|
Regulatory fees |
| 560 |
|
|
| 456 |
|
|
| 1,011 |
|
|
| 895 |
|
Professional fees |
| 394 |
|
|
| 474 |
|
|
| 805 |
|
|
| 898 |
|
Occupancy and equipment |
| 127 |
|
|
| 187 |
|
|
| 370 |
|
|
| 373 |
|
Other |
| 1,251 |
|
|
| 866 |
|
|
| 2,143 |
|
|
| 1,872 |
|
Total non-interest expense |
| 9,904 |
|
|
| 8,605 |
|
|
| 19,234 |
|
|
| 17,127 |
|
|
|
|
|
|
|
|
| ||||||||
Income before income taxes |
| 24,441 |
|
|
| 23,916 |
|
|
| 49,927 |
|
|
| 42,667 |
|
Provision for income taxes |
| 6,581 |
|
|
| 6,397 |
|
|
| 13,283 |
|
|
| 11,376 |
|
|
|
|
|
|
|
|
| ||||||||
Net income | $ | 17,860 |
|
| $ | 17,519 |
|
| $ | 36,644 |
|
| $ | 31,291 |
|
MEDALLION BANK | |||||||||||
(In thousands) | June 30, 2022 |
| December 31, 2021 |
| June 30, 2021 | ||||||
Assets |
|
|
|
|
| ||||||
Cash and federal funds sold | $ | 93,946 |
|
| $ | 61,402 |
|
| $ | 61,563 |
|
Investment securities, available-for-sale |
| 50,358 |
|
|
| 44,772 |
|
|
| 48,307 |
|
Loans, inclusive of net deferred loan acquisition costs |
| 1,638,426 |
|
|
| 1,415,415 |
|
|
| 1,274,846 |
|
Allowance for loan losses |
| (58,079 | ) |
|
| (53,384 | ) |
|
| (52,799 | ) |
Loans, net |
| 1,580,347 |
|
|
| 1,362,031 |
|
|
| 1,222,047 |
|
Loan collateral in process of foreclosure |
| 14,053 |
|
|
| 21,438 |
|
|
| 32,768 |
|
Fixed assets and right-of-use lease assets, net |
| 5,766 |
|
|
| 4,230 |
|
|
| 3,308 |
|
Deferred tax assets |
| 8,829 |
|
|
| 7,576 |
|
|
| 7,936 |
|
Due from affiliates |
| — |
|
|
| — |
|
|
| 487 |
|
Accrued interest receivable and other assets |
| 42,038 |
|
|
| 37,788 |
|
|
| 33,911 |
|
Total assets | $ | 1,795,337 |
|
| $ | 1,539,237 |
|
| $ | 1,410,327 |
|
Liabilities and Shareholders’ Equity |
|
|
|
|
| ||||||
Liabilities |
|
|
|
|
| ||||||
Deposits and other funds borrowed | $ | 1,469,241 |
|
| $ | 1,250,880 |
|
| $ | 1,152,068 |
|
Accrued interest payable |
| 1,303 |
|
|
| 1,228 |
|
|
| 1,196 |
|
Income tax payable |
| 26,924 |
|
|
| 16,104 |
|
|
| 4,643 |
|
Other liabilities |
| 14,460 |
|
|
| 7,672 |
|
|
| 10,256 |
|
Due to affiliates |
| 478 |
|
|
| 906 |
|
|
| — |
|
Total liabilities |
| 1,512,406 |
|
|
| 1,276,790 |
|
|
| 1,167,676 |
|
Total shareholders’ equity |
| 282,931 |
|
|
| 262,447 |
|
|
| 242,164 |
|
Total liabilities and shareholders’ equity | $ | 1,795,337 |
|
| $ | 1,539,237 |
|
| $ | 1,410,327 |
|
