Medallion Financial Corp 8-K, filed Apr 29, 2022
Medallion Financial Corp (MFIN)
About this 8-K
Medallion Financial Corp filed this 8-K on April 29, 2022.
Items reported
- Item 7.01: Regulation FD disclosure
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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| Item 7.01 | Regulation FD Disclosure. |
Medallion Bank, a wholly owned subsidiary of Medallion Financial Corp. (the “Company”), issued a press release to the news media announcing, among other things, Medallion Bank’s results for the quarter ended March 31, 2022.
A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference. The information in the press release is being furnished, not filed, pursuant to Item 7.01. Accordingly, the information in the press release will not be incorporated by reference into any registration statement filed by the Company under the Securities Act of 1933, as amended, unless specifically identified therein as being incorporated therein by reference.
| Item 9.01 | Financial Statements and Exhibits |
| (d) | Exhibits |
The following exhibits are being filed with this Current Report on Form 8-K:
| 99.1 | Medallion Bank press release, dated April 29, 2022 | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | |
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Dated: April 29, 2022
| MEDALLION FINANCIAL CORP. | ||||
| By: | /s/ Anthony N. Cutrone | |||
| Name: | Anthony N. Cutrone | |||
| Title: | Chief Financial Officer | |||
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Exhibit 99.1
FOR IMMEDIATE RELEASE:
MEDALLION BANK REPORTS 2022 FIRST QUARTER RESULTS AND DECLARES
SERIES F PREFERRED STOCK DIVIDEND
SALT LAKE CITY, UT – April 29, 2022 – 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 2022 first quarter results.
2022 Second Quarter Highlights
| • | Net income of $18.8 million, compared to net income of $13.8 million in the prior year period. |
| • | Net interest income of $37.2 million with a net interest margin of 9.66%, compared to $31.0 million and 9.92% in the prior year period. |
| • | Annualized ROA and ROE were 4.88% and 28.55%, respectively, as of March 31, 2022, compared to 4.34% and 25.03% in the prior year period. |
| • | Provision for loan losses was $2.1 million, compared to a provision of $2.7 million in the prior year period. |
| • | Annualized net charge-offs were 0.7% of average loans outstanding, compared to 1.0% in the prior year period. |
| • | The recreation and home improvement loan portfolios grew 21.5% and 38.3%, respectively, during the 12-month period ending March 31, 2022. |
| • | Total assets were $1.6 billion, total capital was $273.0 million, and the Tier 1 leverage ratio was 17.5% at March 31, 2022. |
Donald Poulton, President and Chief Executive Officer of Medallion Bank, stated, “The momentum of record earnings, loan originations, and historically low loan losses in 2021 continued into the first quarter of 2022. Our $18.8 million of net income was more than 36% higher than the prior year period. This was largely driven by asset growth in both our Recreation Lending and Home Improvement Lending segments. Stable loan loss provisions complemented that growth, reflecting strong consumer credit performance. With market rates now rising after years of stability, our team continues to execute our strategic plan with a primary focus of meeting the financing needs of our customers.”
Recreation Lending Segment
| • | The Bank’s recreation loan portfolio grew 21.5% to $1.0 billion as of March 31, 2022, compared to $828.7 million at March 31, 2021. |
| • | Net interest income was $28.3 million, compared to $24.3 million in the prior year period. |
| • | Recreation loans were 67.4% of loans receivable as of March 31, 2022, compared to 68.8% at March 31, 2021. |
| • | The provision for recreation loan losses was $1.7 million, compared to $3.6 million in the prior year period. |
| • | Annualized net charge-offs were 1.07% of average recreation loans outstanding, compared to 1.62% in the prior year period. |
Home Improvement Lending Segment
| • | The Bank’s home improvement loan portfolio grew 38.3% to $473.5 million as of March 31, 2022, compared to $342.3 million at March 31, 2021. |
| • | Net interest income was $8.8 million, compared to $7.5 million in the prior year period. |
| • | Home improvement loans were 31.7% of loans receivable as of March 31, 2022, compared to 28.4% at March 31, 2021. |
| • | The provision for home improvement loan losses was $1.2 million, compared to $0.5 million in the prior year period. |
| • | Annualized net charge-offs were 0.55% of average home improvement loans outstanding, compared to 0.41% in the prior year period. |
Series F Preferred Stock Dividend
On April 28, 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 July 1, 2022, to holders of record at the close of business on June 15, 2022.
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 “continue,” or the negative version of those words or other comparable words or phrases of a future or forward-looking nature, such as “building”, “maintaining” or “momentum.” 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
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MEDALLION BANK
STATEMENTS OF OPERATIONS
(UNAUDITED)
| For the Three Months Ended March 31, |
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| (In thousands) |
2022 | 2021 | ||||||
| Total interest income |
$ | 41,345 | $ | 35,756 | ||||
| Total interest expense |
4,154 | 4,711 | ||||||
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| Net interest income |
37,191 | 31,045 | ||||||
| Provision (benefit) for loan losses |
2,144 | 2,739 | ||||||
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| Net interest income after provision for loan losses |
35,047 | 28,306 | ||||||
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| Other (loss) income |
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| Write-downs of loan collateral in process of foreclosure |
(386 | ) | (1,129 | ) | ||||
| Other non-interest income |
156 | 94 | ||||||
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| Total non-interest loss, net |
(230 | ) | (1,035 | ) | ||||
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| Non-interest expense |
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| Salaries and benefits |
3,505 | 2,804 | ||||||
| Loan servicing |
2,669 | 2,648 | ||||||
| Collection costs |
1,158 | 1,014 | ||||||
| Regulatory fees |
451 | 438 | ||||||
| Professional fees |
411 | 424 | ||||||
| Occupancy and equipment |
244 | 185 | ||||||
| Other |
894 | 1,007 | ||||||
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| Total non-interest expense |
9,332 | 8,520 | ||||||
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| Income before income taxes |
25,485 | 18,751 | ||||||
| Provision for income taxes |
6,701 | 4,979 | ||||||
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| Net income |
$ | 18,784 | $ | 13,772 | ||||
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MEDALLION BANK
BALANCE SHEETS
(UNAUDITED)
| (In thousands) | March 31, 2022 | December 31, 2021 | March 31, 2021 | |||||||||
| Assets |
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| Cash and federal funds sold |
$ | 83,248 | $ | 61,402 | $ | 72,452 | ||||||
| Investment securities, available-for-sale |
47,075 | 44,772 | 38,081 | |||||||||
| Loans, inclusive of net deferred loan acquisition costs |
1,493,762 | 1,415,415 | 1,203,994 | |||||||||
| Allowance for loan losses |
(52,955 | ) | (53,384 | ) | (65,285 | ) | ||||||
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| Loans, net |
1,440,807 | 1,362,031 | 1,138,709 | |||||||||
| Loan collateral in process of foreclosure |
18,781 | 21,438 | 33,178 | |||||||||
| Fixed assets and right-of-use lease assets, net |
4,454 | 4,230 | 3,316 | |||||||||
| Deferred tax assets |
7,693 | 7,576 | 11,768 | |||||||||
| Accrued interest receivable and other assets |
39,461 | 37,788 | 32,679 | |||||||||
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| Total assets |
$ | 1,641,519 | $ | 1,539,237 | $ | 1,330,183 | ||||||
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| Liabilities and Shareholders’ Equity |
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| Liabilities |
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| Deposits and other funds borrowed |
$ | 1,332,112 | $ | 1,250,880 | $ | 1,084,074 | ||||||
| Accrued interest payable |
1,584 | 1,228 | 1,819 | |||||||||
| Income tax payable |
22,243 | 16,104 | 4,870 | |||||||||
| Other liabilities |
11,927 | 7,672 | 10,189 | |||||||||
| Due to affiliates |
651 | 906 | 601 | |||||||||
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| Total liabilities |
1,368,517 | 1,276,790 | 1,101,553 | |||||||||
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| Total shareholders’ equity |
273,002 | 262,447 | 228,630 | |||||||||
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| Total liabilities and shareholders’ equity |
$ | 1,641,519 | $ | 1,539,237 | $ | 1,330,183 | ||||||
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