Medallion Bank Reports 2021 Third Quarter Results and Declares Series F Preferred Stock Dividend

SALT LAKE CITY, Oct. 28, 2021 (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 loan origination services to fintech partners, announced today its 2021 third quarter results. The Bank is a […]

SALT LAKE CITY, Oct. 28, 2021 (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 loan origination services to fintech partners, announced today its 2021 third quarter results. The Bank is a wholly owned subsidiary of Medallion Financial Corp. (Nasdaq: MFIN).

2021 Third Quarter Highlights

  • Record net income of $19.7 million, compared to a net loss of $13.2 million in the prior year period.

  • Net interest income of $35.3 million, compared to $31.1 million in the prior year period.

  • Loan loss benefit was $0.2 million, driven by lower consumer borrower defaults and recoveries from previous period loan losses, compared to a quarterly provision of $35.3 million in the prior year period.

  • Annualized net charge-offs were 1.6% of average loans outstanding, compared to 5.1% in the prior year period.

  • Recreation and home improvement loans in a state of delinquency were 2.0% of the total combined recreation and home improvement loan portfolios.

  • The recreation and home improvement loan portfolios grew 15.9% and 26.4%, respectively, from September 30, 2020.

  • Total assets were $1.5 billion, total capital was $257.7 million, and the Tier 1 leverage ratio was 18.2% at September 30, 2021.

Donald Poulton, President and Chief Executive Officer of Medallion Bank, stated, “We again achieved record quarterly net income, reflecting ongoing strong performance in our consumer lending businesses. Loan origination growth remained elevated, and we continued to benefit from historically low loan loss provisions. The Bank is fortunate to be operating in markets that have experienced demand surges during the COVID pandemic. This has allowed us to deliver four consecutive quarters of significant bottom-line results, which are reflected in our year-to-date return on assets of 5.0% and return on equity of 28.9%. We continue to execute our strategy and are optimistic about future growth and performance.”

Recreation Lending Segment

  • The Bank’s recreation loan portfolio grew 15.9% to $938.7 million as of September 30, 2021, compared to $809.9 million at September 30, 2020.

  • Net interest income was $27.8 million compared to $25.4 million in the prior year period.

  • Recreation loans were 69.5% of loans receivable as of September 30, 2021, as compared to 67.1% at September 30, 2020.

  • The provision for recreation loan losses was $1.0 million, compared to $1.8 million in the prior year period.

  • Recreation loan delinquencies 90 days or more past due were $3.1 million, or 0.3% of gross recreation loans, as of September 30, 2021, compared to $4.1 million, or 0.5%, at September 30, 2020.

Home Improvement Lending Segment

  • The Bank’s home improvement loan portfolio grew 26.4% to $399.0 million as of September 30, 2021, compared to $315.6 million at September 30, 2020.

  • Net interest income was $7.7 million compared to $6.2 million in the prior year period.

  • Home improvement loans were 29.5% of loans receivable as of September 30, 2021, as compared to 26.2% at September 30, 2020.

  • The provision for home improvement loan losses was $0.4 million, compared to $0.7 million in the prior year period.

  • Home improvement loan delinquencies 90 days or more past due were $161,000, or 0.04% of gross home improvement loans as of September 30, 2021, compared to $103,000, or 0.03%, at September 30, 2020.

Medallion Lending Segment

  • Medallion loans were 0.9% of the Bank’s total loans receivable as of September 30, 2021.

  • Total gross exposure of the Medallion loan segment (which includes loans in process of foreclosure and remarketed assets) was $34.7 million, or 2.3% of total assets, as of September 30, 2021.

Unless otherwise specified, loan portfolios are presented net of deferred loan acquisition costs.

Series F Preferred Stock Dividend

On October 26, 2021, 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 January 3, 2022 to holders of record at the close of business on December 15, 2021.

About Medallion Bank

Medallion Bank specializes in providing consumer loans for the purchase of recreational vehicles, boats and home improvements, and offering loan origination services to fintech 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 “believe,” “continue to,” “expect,” “should,” “strategy,” and “will” or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. These statements relate to our future earnings, returns, capital levels, 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, 2020, 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
[email protected]

MEDALLION BANK
STATEMENTS OF OPERATIONS
(UNAUDITED)

For the Three Months Ended September 30,

(In thousands)

2021

2020

Total interest income

$

39,524

$

36,565

Total interest expense

4,189

5,454

Net interest income

35,335

31,111

Provision (benefit) for loan losses

(196

)

35,299

Net interest income (loss) after provision for loan losses

35,531

(4,188

)

Other income (loss)

Write-downs of loan collateral in process of foreclosure and other assets

(298

)

(5,574

)

Other non-interest income

222

109

Total other loss

(76

)

(5,465

)

Non-interest expense

Salaries and benefits

2,797

2,535

Loan servicing

2,584

2,831

Collection costs

1,335

1,170

Regulatory fees

488

348

Professional fees

431

384

Occupancy and equipment

199

234

Other

809

902

Total non-interest expense

8,643

8,404

Income (loss) before income taxes

26,812

(18,057

)

Provision (benefit) for income taxes

7,116

(4,859

)

Net income (loss)

$

19,696

$

(13,198

)

MEDALLION BANK
BALANCE SHEETS
(UNAUDITED)

(In thousands)

September 30, 2021

December 31, 2020

September 30, 2020

Assets

Cash and federal funds sold

$

56,088

$

58,977

$

39,884

Investment securities, available-for-sale

47,511

46,792

45,991

Loans, inclusive of net deferred loan acquisition costs

1,351,240

1,167,748

1,206,780

Allowance for loan losses

(52,954

)

(65,557

)

(98,446

)

Loans, net

1,298,286

1,102,191

1,108,334

Loan collateral in process of foreclosure

28,069

35,557

25,900

Fixed assets and right-of-use assets, net

3,964

3,418

3,462

Deferred tax assets

7,632

11,839

20,470

Due from affiliates

3,298

Income tax receivable

549

Accrued interest receivable and other assets

35,291

28,746

35,904

Total assets

$

1,476,841

$

1,291,367

$

1,279,945

Liabilities and shareholders’ equity

Deposits and other funds borrowed

$

1,196,508

$

1,065,398

$

1,057,499

Accrued interest payable

1,562

1,515

1,992

Income taxes payable

9,789

2,948

Other liabilities

10,689

5,980

9,288

Due to affiliates

586

996

Total liabilities

1,219,134

1,072,893

1,072,723

Total shareholders’ equity

257,707

218,474

207,222

Total liabilities and shareholders’ equity

$

1,476,841

$

1,291,367

$

1,279,945

https://finance.yahoo.com/news/medallion-bank-reports-2021-third-205200001.html

Dong Anker

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