Manhattan Bridge Capital, Inc 10-Q for FY2025 Q2
Manhattan Bridge Capital, Inc (LOAN)
About this 10-Q
Manhattan Bridge Capital, Inc filed this 10-Q on July 22, 2025, covering the quarter ended June 30, 2025 (FY2025 Q2).
Headline figures
Quarter ended June 30, 2025, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Revenue
- $2.36M
- down 3.6% from $2.44M a year earlier
- Net income
- $1.41M
- up 0.3% from net income of $1.41M a year earlier
- Diluted EPS
- $0.12
- unchanged from $0.12 a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(Mark One)
For
the quarterly period ended
or
For the transition period from _______________________________ to _________________________________
Commission
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or other jurisdiction of incorporation or organization) |
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Securities registered pursuant to Section 12(b) of the Act:
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Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2)
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by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule
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Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer | ☐ | Accelerated filer | ☐ | |
| ☒ | Smaller reporting company | |||
| Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes
As of July 22, 2025, the registrant had a total of common shares, $ par value per share, outstanding.
MANHATTAN BRIDGE CAPITAL, INC.
TABLE OF CONTENTS
Forward Looking Statements
This report contains forward-looking statements within the meaning of section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Forward-looking statements are typically identified by the words “believe,” “expect,” “intend,” “estimate” and similar expressions. Those statements appear in a number of places in this report and include statements regarding our intent, belief or current expectations or those of our directors or officers with respect to, among other things, trends affecting our financial condition and results of operations and our business and growth strategies. These forward-looking statements are not guarantees of future performance and involve risks and uncertainties. Actual results may differ materially from those projected, expressed or implied in the forward-looking statements as a result of various factors (such factors are referred to herein as “Cautionary Statements”), including but not limited to the following: (i) our loan origination activities, revenues and profits are limited by available funds; (ii) we operate in a highly competitive market and competition may limit our ability to originate loans with favorable interest rates; (iii) our Chief Executive Officer is critical to our business and our future success may depend on our ability to retain him; (iv) if we overestimate the yields on our loans or incorrectly value the collateral securing the loan, we may experience losses; (v) we may be subject to “lender liability” claims; (vi) our due diligence may not uncover all of a borrower’s liabilities or other risks to its business; (vii) borrower concentration could lead to significant losses; (viii) we may choose to make distributions in our own stock, in which case you may be required to pay income taxes in excess of the cash dividends you receive; (ix) an increase in interest rates may impact our profitability; (x) we may be unsuccessful in our efforts to extend or replace the Webster Credit Line (as defined below); and (xi) we may be unsuccessful in our efforts to refinance our 6% senior secured notes, due April 22, 2026 (the “Notes”). The accompanying information contained in this report, including the information set forth under “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” identifies important factors that could cause such differences. Further information on potential factors that could affect our business is described under the heading “Risk Factors” in Part I, Item 1A, of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024. These forward-looking statements speak only as of the date of this report, and we caution potential investors not to place undue reliance on such statements. We undertake no obligation to update or revise any forward-looking statements. All subsequent written or oral forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the Cautionary Statements.
All references in this Form 10-Q to “Company,” “we,” “us,” or “our” refer to Manhattan Bridge Capital, Inc. and its wholly-owned subsidiary, MBC Funding II Corp., unless the context otherwise indicates.
PART I. FINANCIAL INFORMATION
Item 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
MANHATTAN BRIDGE CAPITAL, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
June 30, 2025 | December 31, 2024 | |||||||
| (unaudited) | (audited) | |||||||
| Assets | ||||||||
| Loans receivable, net of deferred origination and other fees | $ | $ | ||||||
| Interest and other fees receivable on loans | ||||||||
| Cash | ||||||||
| Cash – restricted | ||||||||
| Other assets | ||||||||
| Right-of-use asset – operating lease, net | ||||||||
| Deferred financing costs, net | ||||||||
| Total assets | $ | $ | ||||||
| Liabilities and Stockholders’ Equity | ||||||||
| Liabilities: | ||||||||
| Line of credit | $ | $ | ||||||
| Senior secured notes (net of deferred financing costs of $ | ||||||||
| Accounts payable and accrued expenses | ||||||||
| Operating lease liability | ||||||||
| Loan holdback | ||||||||
| Dividends payable | ||||||||
| Total liabilities | ||||||||
| Commitments and contingencies | ||||||||
| Stockholders’ equity: | ||||||||
| Preferred shares - $ par value; shares authorized; issued and outstanding | ||||||||
| Common shares - $ par value; shares authorized; issued; outstanding | ||||||||
| Additional paid-in capital | ||||||||
| Less: Treasury stock, at cost – shares | ( | ) | ( | ) | ||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Total stockholders’ equity | ||||||||
| Total liabilities and stockholders’ equity | $ | $ | ||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
| 2 |
MANHATTAN BRIDGE CAPITAL, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Revenue: | ||||||||||||||||
| Interest income from loans | $ | $ | $ | $ | ||||||||||||
| Origination fees | ||||||||||||||||
| Total revenue | ||||||||||||||||
| Operating costs and expenses: | ||||||||||||||||
| Interest and amortization of deferred financing costs | ||||||||||||||||
| Referral fees | ||||||||||||||||
| General and administrative expenses | ||||||||||||||||
| Total operating costs and expenses | ||||||||||||||||
| Income from operations | ||||||||||||||||
| Other income | ||||||||||||||||
| Income before income tax expense | ||||||||||||||||
| Income tax expense | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Net income | $ | $ | $ | $ | ||||||||||||
| Basic and diluted net income per common share outstanding: | ||||||||||||||||
| —Basic | $ | $ | $ | $ | ||||||||||||
| —Diluted | $ | $ | $ | $ | ||||||||||||
| Weighted average number of common shares outstanding: | ||||||||||||||||
| —Basic | ||||||||||||||||
| —Diluted | ||||||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
| 3 |
MANHATTAN BRIDGE CAPITAL, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
(unaudited)
FOR THE THREE MONTHS ENDED JUNE 30, 2025
| Shares | Amount | in Capital | Shares | Cost | Deficit | Totals | ||||||||||||||||||||||
| Common Shares | Additional Paid | Treasury Stock | Accumulated | |||||||||||||||||||||||||
| Shares | Amount | in Capital | Shares | Cost | Deficit | Totals | ||||||||||||||||||||||
| Balance, April 1, 2025 | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||||||
| Non-cash compensation | ||||||||||||||||||||||||||||
| Dividends declared and payable | ( | ) | ( | ) | ||||||||||||||||||||||||
| Net income | - | - | ||||||||||||||||||||||||||
| Balance, June 30, 2025 | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||||||
FOR THE THREE MONTHS ENDED JUNE 30, 2024
| Common Shares | Additional Paid | Treasury Stock | Accumulated | |||||||||||||||||||||||||
| Shares | Amount | in Capital | Shares | Cost | Deficit | Totals | ||||||||||||||||||||||
| Balance, April 1, 2024 | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||||||
| Non-cash compensation | ||||||||||||||||||||||||||||
| Dividends declared and payable | ( | ) | ( | ) | ||||||||||||||||||||||||
| Net income | - | - | ||||||||||||||||||||||||||
| Balance, June 30, 2024 | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||||||
FOR THE SIX MONTHS ENDED JUNE 30, 2025
| Common Shares | Additional Paid | Treasury Stock | Accumulated | |||||||||||||||||||||||||
| Shares | Amount | in Capital | Shares | Cost | Deficit | Totals | ||||||||||||||||||||||
| Balance, January 1, 2025 | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||||||
| Non-cash compensation | ||||||||||||||||||||||||||||
| Dividends paid | ( | ) | ( | ) | ||||||||||||||||||||||||
| Dividends declared and payable | ( | ) | ( | ) | ||||||||||||||||||||||||
| Net income | - | - | ||||||||||||||||||||||||||
| Balance, June 30, 2025 | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||||||
FOR THE SIX MONTHS ENDED JUNE 30, 2024
| Common Shares | Additional Paid | Treasury Stock | Accumulated | |||||||||||||||||||||||||
| Shares | Amount | in Capital | Shares | Cost | Deficit | Totals | ||||||||||||||||||||||
| Balance, January 1, 2024 | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||||||
| $ | $ | $ | ( | ) | $ | ( | ) | $ | ||||||||||||||||||||
| Purchase of treasury shares | ( | ) | ( | ) | ||||||||||||||||||||||||
| Non-cash compensation | ||||||||||||||||||||||||||||
| Dividends paid | ( | ) | ( | ) | ||||||||||||||||||||||||
| Dividends declared and payable | ( | ) | ( | ) | ||||||||||||||||||||||||
| Net income | - | - | ||||||||||||||||||||||||||
| Balance, June 30, 2024 | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||||||
| Balance | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
| 4 |
MANHATTAN BRIDGE CAPITAL, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
| 2025 | 2024 | |||||||
Six Months Ended June 30, | ||||||||
| 2025 | 2024 | |||||||
| Cash flows from operating activities: | ||||||||
| Net income | $ | $ | ||||||
| Adjustments to reconcile net income to net cash provided by operating activities - | ||||||||
| Amortization of deferred financing costs | ||||||||
| Adjustment to right-of-use asset - operating lease and liability | ( | ) | ||||||
| Depreciation | ||||||||
| Non-cash compensation expense | ||||||||
| Changes in operating assets and liabilities: | ||||||||
| Interest and other fees receivable on loans | ( | ) | ( | ) | ||||
| Other assets | ( | ) | ( | ) | ||||
| Accounts payable and accrued expenses | ( | ) | ( | ) | ||||
| Deferred origination and other fees | ( | ) | ||||||
| Net cash provided by operating activities | ||||||||
| Cash flows from investing activities: | ||||||||
| Issuance of short-term loans | ( | ) | ( | ) | ||||
| Collections received from loans | ||||||||
| Purchase of fixed assets | ( | ) | ( | ) | ||||
| Net cash provided by investing activities | ||||||||
| Cash flows from financing activities: | ||||||||
| Repayment of line of credit | ( | ) | ( | ) | ||||
| Proceeds from line of credit | ||||||||
| Dividends paid | ( | ) | ( | ) | ||||
| Purchase of treasury shares | ( | ) | ||||||
| Deferred financing costs incurred | ( | ) | ||||||
| Net cash used in financing activities | ( | ) | ( | ) | ||||
| Net increase (decrease) in cash | ( | ) | ||||||
| Cash and restricted cash, beginning of period(1) | ||||||||
| Cash and restricted cash, end of period(2) | $ | $ | ||||||
| Supplemental Disclosure of Cash Flow Information: | ||||||||
| Cash paid during the period for taxes | $ | $ | ||||||
| Cash paid during the period for interest | $ | $ | ||||||
| Cash paid during the period for operating leases | $ | $ | ||||||
| Supplemental Schedule of Noncash Financing Activities: | ||||||||
| Dividend declared and payable | $ | $ | ||||||
| Supplemental Schedule of Noncash Operating and Investing Activities: | ||||||||
| Reduction in interest receivable in connection with the increase in loans receivable | $ | $ | ||||||
| (1) |
| (2) |
The accompanying notes are an integral part of these condensed consolidated financial statements.
| 5 |
MANHATTAN BRIDGE CAPITAL, INC. AND SUBSIDIARY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025
1. DESCRIPTION OF THE COMPANY
The accompanying unaudited condensed consolidated financial statements of Manhattan Bridge Capital, Inc. (“MBC”), a New York corporation founded in 1989, and its consolidated subsidiary, MBC Funding II Corp. (“MBC Funding II”), a New York corporation formed in December 2015 (collectively referred to herein as the “Company”) have been prepared by the Company in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information and with instructions to Form 10-Q. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete annual audited financial statements. However, in the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the Company’s annual audited consolidated financial statements for the year ended December 31, 2024 and the notes thereto included in the Company’s Annual Report on Form 10-K. Results of consolidated operations for the interim period are not necessarily indicative of the operating results to be attained in the entire fiscal year.
The Company offers short-term, secured, non–banking loans to real estate investors (also known as hard money loans) to fund their acquisition, renovation, rehabilitation or development of residential or commercial properties located in the New York metropolitan area, including New Jersey and Connecticut, and in Florida.
Summary of Significant Accounting Policies
The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amount of revenues and expenses during the reporting period. Actual amounts could differ from those estimates.
The condensed consolidated financial statements include the accounts of MBC and MBC Funding II. All significant intercompany balances and transactions have been eliminated in consolidation.
Interest income from commercial loans is recognized, as earned, over the loan period.
Loans receivable are presented in the condensed consolidated financial statements at cost, net of deferred origination and other fees, which are amortized over the term of the respective loan.
Certain amounts in the consolidated financial statements for June 30, 2024 and December 31, 2024, have been reclassified to align with the presentation for June 30, 2025.
2. RECENTLY ISSUED TECHNICAL ACCOUNTING PRONOUNCEMENTS
Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s condensed consolidated financial statements.
3. CASH – RESTRICTED
Restricted cash mainly represents collections received, pending clearance, from the Company’s commercial loans and is primarily dedicated to the reduction of the Webster Credit Line (as defined below), established pursuant to the Amended and Restated Credit Agreement (as defined below, see Note 5).
| 6 |
4. COMMERCIAL LOANS
Loans Receivable
The
Company offers short-term secured non–banking loans to real estate investors (also known as hard money loans) to fund their acquisition
and construction of properties located in the New York metropolitan area, including New Jersey and Connecticut, and in Florida. The loans
are principally secured by collateral consisting of real estate and accompanied by personal guarantees from the principals of the borrowers.
The loans are generally for a term of
At
June 30, 2025, the Company has made loans to four different entities in the aggregate amount of $
The Company generally grants loans for a term of one year. When a performing loan reaches its maturity and the borrower requests an extension, the Company may extend the term of the loan beyond one year. Prior to granting an extension of any loan, the Company reevaluates the underlying collateral.
Credit Risk
Credit risk profile based on loan activity as of June 30, 2025 and December 31, 2024:
SCHEDULE OF CREDIT RISK
| Performing loans | Developers- Residential | Developers- Commercial | Developers- Mixed Use | Total outstanding loans | ||||||||||||
| June 30, 2025 | $ | $ | $ | $ | ||||||||||||
| December 31, 2024 (audited) | $ | $ | $ | $ | ||||||||||||
At
June 30, 2025, the Company’s loans receivable consisted of loans in the amount of $
Generally, borrowers are paying their interest, and the Company receives a fee in connection with the extension of the loans. In all instances, the borrowers have either signed an extension agreement or are in the process of signing an extension. Accordingly, at June 30, 2025, no loan impairments exist and there are no provisions for impairment credit losses of loans or recoveries thereof.
Subsequent
to the balance sheet date, approximately $
5. LINE OF CREDIT
The
Company executed an Amended and Restated Credit and Security Agreement (as amended, the “Amended and Restated Credit Agreement”),
with Webster Business Credit Corporation (“Webster”), Flushing Bank (“Flushing”) and Mizrahi Tefahot Bank Ltd
(“Mizrahi” and together with Webster and Flushing, the “Lenders”), which established the Company’s credit
line (the “Webster Credit Line”). Currently, the Webster Credit Line provides the Company with a credit line of $
The
Webster Credit Line contains various covenants and restrictions including, among other covenants and restrictions, limiting the amount
that the Company can borrow relative to the value of the underlying collateral, maintaining various financial ratios and limitations
on the terms of loans the Company makes to its customers, limiting the Company’s ability to pay dividends under certain circumstances,
and limiting the Company’s ability to repurchase its common shares, sell assets, engage in mergers or consolidations, grant liens,
and enter into transactions with affiliates. In addition, the Webster Credit Line contains a cross-default provision which will deem
any default under any indebtedness owed by the Company or its subsidiary, MBC Funding II, as a default under the credit line. Under the
Amended and Restated Credit Agreement, the Company may repurchase, redeem or otherwise retire its equity securities in an amount not
to exceed ten percent of the Company’s annual net income from the prior fiscal year.
| 7 |
The
Company was in compliance with all covenants of the Webster Credit Line, as amended, as of June 30, 2025. At June 30, 2025, the outstanding
amount under the Amended Credit Agreement was $
6. SENIOR SECURED NOTES
On
April 25, 2016, in an initial public offering, MBC Funding II issued
MBC Funding II may redeem the Notes, in whole or in part, at any time after April 22, 2019, upon at least 30 days prior written notice to the Noteholders. The redemption price will be equal to the outstanding principal amount of the Notes redeemed plus the accrued but unpaid interest thereon up to, but not including, the date of redemption, without penalty or premium. No Notes were redeemed by MBC Funding II as of June 30, 2025.
MBC
Funding II is obligated to offer to redeem the Notes if there occurs a “change of control” with respect to MBC Funding II
or the Company or if MBC Funding II or the Company sell any assets unless, in the case of an asset sale, the proceeds are reinvested
in the business of the seller. The redemption price in connection with a “change of control” will be
The
Company guaranteed MBC Funding II’s obligations under the Notes, which are secured by its pledge of
The
Company’s principal executive officers consist of Assaf Ran, who serves as its Chief Executive Officer and President, and Vanessa
Kao, who serves as its Chief Financial Officer. As of June 30, 2025, each of Mr. Ran and Ms. Kao owns an aggregate of $
Basic and diluted earnings per share are calculated in accordance with Accounting Standards Codification (“ASC”) Topic 260, “Earnings Per Share” (“ASC Topic 260”). Under ASC Topic 260, basic earnings per share is computed by dividing income available to common shareholders by the weighted-average number of common shares outstanding for the period. The computation of diluted earnings per share is similar to basic earnings per share, except that the denominator is increased to include the potential dilution from the exercise of stock options and warrants for common shares using the treasury stock method. The numerator in calculating both basic and diluted earnings per common share for each period is the reported net income.
| 8 |
Stock-based
compensation expense recognized under ASC Topic 718, “Compensation-Stock Compensation,” for each of the three-month periods
ended June 30, 2025 and 2024 of $, and for each of the six-month periods ended June 30, 2025 and 2024 of $ represent the amortization
of the fair value of restricted shares granted to the Company’s Chief Executive Officer on September 9, 2011 of $
9. STOCKHOLDERS’ EQUITY
The
Company adopted a share buyback program on April 11, 2023, for the repurchase of up to of the Company’s common shares.
Before this program expired on April 10, 2024, the Company had purchased an aggregate of common shares at an aggregate cost of
$
10. SEGMENT REPORTING
The Company reports segment information based on the management approach which designates the internal reporting used by the Chief Operating Decision Maker, which is the Company’s Chief Executive Officer, for making decisions and assessing performance as the source of the Company’s reportable segments. The Company operates as a single reportable segment, originating, servicing, and managing short-term secured commercial loans to real estate investors. Management evaluates performance on a consolidated basis, as all loans share similar risk profiles, underwriting standards, and operational processes. Key performance metrics include interest income, origination fees, loan performance, and operating expenses. Significant expenses reviewed by management include interest and amortization of deferred financing costs and general and administrative expenses, which remain consistent across loan types. There are no material differences between segment-level information and consolidated financial reporting. The Company will continue to evaluate its segment reporting disclosures and make adjustments if there are material changes in business operations or financial reporting requirements.
Net income from the Company’s reportable segment is as follows:
SCHEDULE OF NET INCOME FROM THE COMPANY’S REPORTABLE SEGMENT
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| (Unaudited) | ||||||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Lending revenue: | $ | $ | $ | $ | ||||||||||||
| Less: | ||||||||||||||||
| Interest expense | ||||||||||||||||
| Amortization of deferred financing costs | ||||||||||||||||
| Referral fees | ||||||||||||||||
| General and administrative expenses | ||||||||||||||||
| Income tax expense | ||||||||||||||||
| Other income | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Net income | $ | $ | $ | $ | ||||||||||||
11. SUBSEQUENT EVENTS
In
accordance with the dividend declared by the Company’s Board of Directors on
********
| 9 |
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis of our consolidated financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and notes thereto included in this Quarterly Report on Form 10-Q. The discussion and analysis contain forward-looking statements based on current expectations that involve risks and uncertainties. Actual results and the timing of certain events may differ significantly from those projected in such forward-looking statements.
We are a New York-based real estate finance company that specializes in originating, servicing and managing a portfolio of first mortgage loans. We offer short-term, secured, non-banking loans (sometimes referred to as “hard money” loans), which we may renew or extend on, before or after their initial term expires, to real estate investors to fund their acquisition, renovation, rehabilitation or development of residential or commercial properties located in the New York metropolitan area, including New Jersey and Connecticut, and in Florida.
The properties securing the loans are generally classified as residential or commercial real estate and, typically, are not income producing. Our loans are generally secured by a first mortgage lien on real estate. In addition, each loan is personally guaranteed by the principal(s) of the borrower, which guarantee may be collaterally secured by a pledge of the guarantor’s interest in the borrower. The face amount of the loans we originated in the past seven years ranged from $40,000 to a maximum of $3.6 million. Our lending policy limits the maximum amount of any loan to the lower of (i) 9.9% of the aggregate amount of our loan portfolio (not including the loan under consideration) and (ii) $4 million. Our loans typically have a maximum initial term of 12 months and bear interest at a fixed rate of 9% to 12% per year, except for one loan issued in June 2024, which had an initial interest rate of 11.5% that was reduced to 7.25% on January 2, 2025, for a period of up to one year. In addition, we usually receive origination fees or “points” ranging from 0% to 2% of the original principal amount of the loan as well as other fees relating to underwriting and funding the loan. Interest is always payable monthly, in arrears. In the case of acquisition financing, the principal amount of the loan usually does not exceed 75% of the value of the property (as determined by an independent appraiser) and in the case of construction financing, it is typically up to 80% of construction costs.
Since commencing our business in 2007, except as set forth below, we have never foreclosed on a property, although sometimes we have renewed or extended the term of a loan to enable the borrower to avoid premature sale or refinancing of the property. When we renew or extend a loan, we generally receive additional “points” and other fees. In June 2023, we filed a foreclosure lawsuit relating to one property, as a result of a deed transfer from the borrower to a buyer without our consent. In that instance, the buyer of the property on which we had a valid mortgage suffered a data breach which resulted in the failure of the buyer to remit the funds needed for the loan payoff. In October 2023, we received the entire payoff amount for the loan receivable, including all unpaid fees, to rectify the situation.
Our primary business objective is to grow our loan portfolio while protecting and preserving capital in a manner that provides for attractive risk-adjusted returns to our shareholders over the long term through dividends. We intend to achieve this objective by continuing to selectively originate, fund loans secured by first mortgages on residential and commercial real estate held for investment located in the New York metropolitan area, including New Jersey and Connecticut, and in Florida, and to carefully manage and service our portfolio in a manner designed to generate attractive risk-adjusted returns across a variety of market conditions and economic cycles. We believe that current market dynamics specifically the demand/supply imbalance for relatively small real estate loans, presents opportunities for us to selectively originate high-quality first mortgage loans and we believe that these market conditions should persist for a number of years. We have built our business on a foundation of intimate knowledge of the New York metropolitan area real estate market combined with a disciplined credit and due diligence culture that is designed to protect and preserve capital. We believe that our flexibility and ability to structure loans that address the needs of our borrowers without compromising our standards on credit risk, our expertise, our intimate knowledge of the New York metropolitan area real estate market and our focus on newly originated first mortgage loans, has defined our success until now and should enable us to continue to achieve our objectives.
A principal source of new transactions has been repeat business from prior customers and their referral of new business. We also receive leads for new business from banks, brokers and a limited amount of advertising. Finally, our Chief Executive Officer also spends a significant portion of his time on new business development. We rely on our own employees, independent legal counsel, and other independent professionals to verify titles and ownership, to file liens and to consummate the transactions. Outside appraisers are used to assist us in evaluating the worth of collateral, when deemed necessary by management. We also use construction inspectors.
For the six month periods ended June 30, 2025 and 2024, the total amounts of $23,495,662 and $19,677,520, respectively, have been lent, offset by collections received from borrowers, under our commercial loans of $23,619,317 and $25,866,190, respectively.
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At June 30, 2025, we were committed to $6,286,256 in construction loans that can be drawn by our borrowers when certain conditions are met.
To date, none of the loans previously made have been non-collectable, although no assurances can be given that existing or future loans may not prove to be non-collectible or foreclosed in the future.
We satisfied all of the requirements to be taxed as a real estate investment trust (“REIT”) and elected to be taxed as a REIT commencing with our taxable year ended December 31, 2014. In order to maintain our qualification for taxation as a REIT and avoid any excise tax on our net taxable income, we are required to distribute each year at least 90% of our REIT taxable income. If we distribute less than 100% of our taxable income (but more than 90%), the undistributed portion will be taxed at the regular corporate income tax rates. As a REIT, we may also be subject to federal excise taxes and minimum state taxes.
Results of Operations
Three months ended June 30, 2025 compared to three months ended June 30, 2024
Total revenue
Total revenues for the three months ended June 30, 2025 were approximately $2,355,000 compared to approximately $2,443,000 for the three months ended June 30, 2024, a decrease of $88,000, or 3.6%. The decrease in revenue was primarily attributable to lower interest income, resulting from a reduction in loans receivable, period-over-period, partially offset by an increase of origination fees. For the three months ended June 30, 2025 and 2024, approximately $1,899,000 and $2,033,000, respectively, of our revenues were attributable to interest income on secured commercial loans that we offer to real estate investors, and approximately $456,000 and $411,000, respectively, of our revenues were attributable to origination fees on such loans. The loans are principally secured by collateral consisting of real estate and accompanied by personal guarantees from the principals of the borrowers.
Interest and amortization of deferred financing costs
Interest and amortization of deferred financing costs for the three months ended June 30, 2025 were approximately $506,000 compared to approximately $603,000 for the three months ended June 30, 2024, a decrease of $97,000, or 16.1%. The decrease is primarily attributable to the decrease in interest expense due to lower SOFR rates and a reduction in borrowed amounts related to the use of the Webster Credit Line (See Note 5 to the condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q).
General and administrative expenses
General and administrative expenses for the three months ended June 30, 2025 were approximately $438,000 compared to approximately $434,000 for the three months ended June 30, 2024, an increase of $4,000. The increase is primarily attributable to increases in payroll expense and NYSE American listing fee, partially offset by a reduction in legal fees as well as costs related to the filing of our registration statement on Form S-3 incurred in 2024.
Net income
Net income for the three months ended June 30, 2025 was approximately $1,413,000 compared to approximately $1,409,000 for the three months ended June 30, 2024, an increase of $4,000. The difference between periods was nominal.
Six months ended June 30, 2025 compared to six months ended June 30, 2024
Total revenue
Total revenues for the six months ended June 30, 2025 were approximately $4,629,000 compared to approximately $5,016,000 for the six months ended June 30, 2024, a decrease of $387,000, or 7.7%. The decrease in revenue was primarily attributable to lower interest income, resulting from a reduction in loans receivable, period-over-period. For the six months ended June 30, 2025 and 2024, revenues of approximately $3,733,000 and $4,175,000, respectively, were attributable to interest income on secured commercial loans that we offer to real estate investors, and approximately $896,000 and $841,000, respectively, were attributable to origination fees on such loans. The loans are principally secured by collateral consisting of real estate and accompanied by personal guarantees from the principals of the borrowers.
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Interest and amortization of deferred financing costs
Interest and amortization of deferred financing costs for the six months ended June 30, 2025 were approximately $958,000 compared to approximately $1,294,000 for the six months ended June 30, 2024, a decrease of $336,000, or 26.0%. The decrease is primarily attributable to the decrease in interest expense due to lower SOFR rates and a reduction in borrowed amounts related to the use of the Webster Credit Line (see Note 5 to the condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q).
General and administrative expenses
General and administrative expenses for the six months ended June 30, 2025 were approximately $891,000 compared to approximately $845,000 for the six months ended June 30, 2024, an increase of $46,000, or 5.4%. The increase is primarily attributable to increases in payroll and appraisal expenses as well as NYSE American listing fee, partially offset by reductions in travel and meals expenses as well as costs related to the filing of our registration statement on Form S-3 incurred in 2024.
Net income
Net income for the six months ended June 30, 2025 was approximately $2,786,000 compared to approximately $2,885,000 for the six months ended June 30, 2024, a decrease of $99,000, or 3.4%. This decrease is primarily attributable to the decrease in interest income from loans, partially offset by the decrease in interest expense.
Liquidity and Capital Resources
At June 30, 2025, we had cash of approximately $209,000, compared to cash of approximately $178,000 at December 31, 2024, not including restricted cash, which mainly represents collections received, pending clearance, from the Company’s commercial loans and is primarily dedicated to the reduction of the Webster Credit Line.
For the six months ended June 30, 2025, net cash provided by operating activities was approximately $2,407,000, compared to approximately $2,425,000 for the six months ended June 30, 2024. The decrease in net cash provided by operating activities was primarily due to the decrease in net income and a larger increase in interest and other fees receivable on loans compared to the prior period, partially offset by an increase in deferred origination and other fees.
For the six months ended June 30, 2025, net cash provided by investing activities was approximately $136,000, compared to approximately $6,410,000 for the six months ended June 30, 2024. Net cash provided by investing activities for the six months ended June 30, 2025 mainly consisted of the collection of our commercial loans of approximately $23,619,000, offset by the issuance of commercial loans of approximately $23,483,000. Net cash provided by investing activities for the six months ended June 30, 2024 mainly consisted of the collection of our commercial loans of approximately $25,866,000, offset by the issuance of commercial loans of $19,455,000.
For the six months ended June 30, 2025, net cash used in financing activities was approximately $2,536,000, compared to approximately $10,421,000 for the six months ended June 30, 2024. Net cash used in financing activities for the six months ended June 30, 2025 reflects dividend payments of approximately $2,631,000, partially offset by the net proceeds from the Webster Credit Line of approximately $95,000. Net cash used in financing activities for the six months ended June 30, 2024 reflects the partial repayment of the Webster Credit Line of approximately $7,807,000, dividend payments of approximately $2,603,000, repurchase of treasury shares of approximately $10,000 and deferred financing costs of approximately $2,000.
Our Amended and Restated Credit and Security Agreement with Webster, Flushing Bank and Mizrahi provides for the Webster Credit Line. Currently, the Webster Credit Line provides us with a credit line of $32.5 million in the aggregate until February 28, 2026, secured by assignments of mortgages and other collateral. The interest rates relating to the Webster Credit Line equal (i) SOFR plus a premium, which rate aggregated approximately 7.9%, including a 0.5% agency fee, as of June 30, 2025, or (ii) a Base Rate (as defined in the Amended and Restated Credit Agreement) plus 2.00% and a 0.5% agency fee, as chosen by the Company for each drawdown.
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The Webster Credit Line contains various covenants and restrictions including covenants limiting the amount that the Company can borrow relative to the value of the underlying collateral, maintaining various financial ratios and limitations on the terms of loans the Company makes to its customers, limiting the Company’s ability to pay dividends under certain circumstances, and limiting the Company’s ability to repurchase its common shares, sell assets, engage in mergers or consolidations, grant liens, and enter into transactions with affiliates. In addition, the Webster Credit Line contains a cross default provision which will deem any default under any indebtedness owed by us or our subsidiary, MBC Funding II, as a default under the credit line. Under the Amended and Restated Credit Agreement, the Company may repurchase, redeem or otherwise retire its equity securities in an amount not to exceed ten percent of our annual net income from the prior fiscal year. Further, the Company may issue up to $20 million in bonds through its subsidiary, of which not more than $10 million of such bonds may be secured by mortgage notes receivable, and provided that the terms and conditions of such bonds are approved by Webster, subject to its reasonable discretion. In addition, Mr. Ran has provided a personal guaranty of the potential amounts owed under the Webster Credit Line, with such guaranty not to exceed the sum of $1,000,000 plus any costs relating to the enforcement of the personal guaranty.
We were in compliance with all covenants of the Webster Credit Line, as amended, as of June 30, 2025. At June 30, 2025, the outstanding amount under the Amended and Restated Credit Agreement was $16,523,205. The interest rate on the amount outstanding fluctuates daily. The rate, including a 0.5% agency fee, was approximately 7.9% as of June 30, 2025.
MBC Funding II has $6,000,000 of outstanding principal amount of Notes. The Notes mature on April 22, 2026, unless redeemed earlier, and accrue interest at a rate of 6% per annum commencing on May 16, 2016 and will be payable monthly, in arrears, in cash, on the 15th day of each calendar month, commencing June 2016.
Under the terms of the Indenture, the aggregate outstanding principal balance of the mortgage loans held by MBC Funding II, together with its cash on hand, must always equal at least 120% of the aggregate outstanding principal amount of the Notes at all times. To the extent the aggregate principal amount of the mortgage loans owned by MBC Funding II plus its cash on hand is less than 120% of the aggregate outstanding principal balance of the Notes, MBC Funding II is required to repay, on a monthly basis, the principal amount of the Notes equal to the amount necessary such that, after giving effect to such repayment, the aggregate principal amount of all mortgage loans owned by it plus, its cash on hand at such time is equal to or greater than 120% of the outstanding principal amount of the Notes. For this purpose, each mortgage loan is deemed to have a value equal to its outstanding principal balance, unless the borrower is in default of its obligations.
The Notes are secured by a first priority lien on all of MBC Funding II’s assets, including, primarily, mortgage notes, mortgages and other transaction documents entered into in connection with first mortgage loans originated and funded by us, which MBC Funding II acquired from MBC pursuant to an asset purchase agreement. MBC Funding II may redeem the Notes, in whole or in part, at any time after April 22, 2019 upon at least 30 days prior written notice to the noteholders. The redemption price will be equal to the outstanding principal amount of the Notes redeemed plus the accrued but unpaid interest thereon up to, but not including, the date of redemption, without penalty or premium. No Notes were redeemed by MBC Funding II as of June 30, 2025.
MBC Funding II is obligated to offer to redeem the Notes if there occurs a “change of control” with respect to us or MBC Funding II or if we or MBC Funding II sell any assets unless, in the case of an asset sale, the proceeds are reinvested in the business of the seller. The redemption price in connection with a “change of control” will be 101% of the principal amount of the Notes redeemed plus accrued but unpaid interest thereon up to, but not including, the date of redemption. The redemption price in connection with an asset sale will be the outstanding principal amount of the Notes redeemed plus accrued but unpaid interest thereon up to, but not including, the date of redemption.
We guarantee MBC Funding II’s obligations under the Notes, which are secured by our pledge of 100% of the outstanding common shares of MBC Funding II that we own.
On April 11, 2023, our board of directors authorized a share buyback program for the repurchase of up to 100,000 of our common shares. Before this program expired on April 10, 2024, we had purchased an aggregate of 56,294 common shares at an aggregate cost of approximately $271,000.
We expect that our current cash balances, the Amended and Restated Credit Agreement, as described above, and cash flows from operations will be sufficient to fund our operations over the next 12 months. We currently do not believe there will be any issues in extending the Webster Credit Line or securing a similar line from another bank before its expiration, and we plan to refinance the Notes prior to their maturity, though we cannot assure that we will be successful in doing so on favorable terms or at all. From time to time, we also receive short-term unsecured loans from our executive officers and others, providing us with the flexibility needed for the steady deployment of capital. However, we anticipate that our working capital requirements will increase in the coming 12 months as we continue to pursue growth under favorable conditions.
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Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
As a smaller reporting company, we are not required to provide the information required by this Item.
Item 4. CONTROLS AND PROCEDURES
| (a) | Evaluation and Disclosure Controls and Procedures |
Our management, with the participation of our chief executive officer and chief financial officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of June 30, 2025 (the “Evaluation Date”). Based upon that evaluation, the chief executive officer and the chief financial officer concluded that, as of the Evaluation Date, our disclosure controls and procedures are effective to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act (i) are recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms and (ii) are accumulated and communicated to our management, including its chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding required disclosure.
| (b) | Changes in Internal Control Over Financial Reporting |
There was no change in our internal control over financial reporting (as defined in Rules 13a-15(f) or 15d-15(f) under the Exchange Act) during the fiscal quarter ended June 30, 2025 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
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PART II OTHER INFORMATION
Item 6. EXHIBITS
| Exhibit No. | Description | |
| 31.1 | Chief Executive Officer Certification under Rule 13a-14 | |
| 31.2 | Chief Financial Officer Certification under Rule 13a-14 | |
| 32.1* | Chief Executive Officer Certification pursuant to 18 U.S.C. section 1350 | |
| 32.2* | Chief Financial Officer Certification pursuant to 18 U.S.C. section 1350 | |
| 101.INS | Inline XBRL Instance Document | |
| 101.CAL | Inline XBRL Taxonomy Extension Schema Document | |
| 101.SCH | Inline XBRL Taxonomy Extension Calculation Linkbase Document | |
| 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | |
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | |
| 104 | Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101). |
| * | Furnished, not filed, in accordance with item 601(32)(ii) of Regulation S-K. |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| Manhattan Bridge Capital, Inc. (Registrant) | ||
| Date: July 22, 2025 | By: | /s/ Assaf Ran |
| Assaf Ran, President and Chief Executive Officer | ||
| (Principal Executive Officer) | ||
| Date: July 22, 2025 | By: | /s/ Vanessa Kao |
| Vanessa Kao, Chief Financial Officer | ||
| (Principal Financial and Accounting Officer) | ||
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EXHIBIT 31.1
CERTIFICATION
I, Assaf Ran, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Manhattan Bridge Capital, Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
| a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | |
| b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | |
| c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | |
| d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
| a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and | |
| b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
| Date: July 22, 2025 | |
| /s/ Assaf Ran | |
| Assaf Ran | |
| President and Chief Executive Officer | |
| (Principal Executive Officer) | |
EXHIBIT 31.2
CERTIFICATION
I, Vanessa Kao, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Manhattan Bridge Capital, Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
| a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | |
| b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | |
| c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | |
| d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
| a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and | |
| b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: July 22, 2025
| /s/ Vanessa Kao | |
| Vanessa Kao | |
| Chief Financial Officer | |
| (Principal Financial and Accounting Officer) |
Exhibit 32.1
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350
In connection with the Quarterly Report on Form 10-Q of Manhattan Bridge Capital, Inc. (the “Company”) for the period ended June 30, 2025 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Assaf Ran, President and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. ss. 1350, that, to my knowledge:
(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
Dated: July 22, 2025
| /s/ Assaf Ran | |
| Assaf Ran | |
| President and Chief Executive Officer | |
(Principal Executive Officer) |
Exhibit 32.2
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350
In connection with the Quarterly Report on Form 10-Q of Manhattan Bridge Capital, Inc. (the “Company”) for the period ended June 30, 2025 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Vanessa Kao, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. ss. 1350, that, to my knowledge:
(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
Dated: July 22, 2025
| /s/ Vanessa Kao | |
| Vanessa Kao | |
| Chief Financial Officer | |
| (Principal Financial and Accounting Officer) |