Medallion Bank Reports 2024 Second Quarter Results and Declares Series F Preferred Stock Dividend
Medallion Bank (Nasdaq: MBNKP) reported its Q2 2024 results, showing mixed performance. Net income decreased to $15.0 million from $19.3 million in the prior year quarter, while net interest income increased to $50.2 million from $47.0 million. The bank's total loan portfolio grew 10% year-over-year to $2.3 billion. However, the net interest margin declined to 8.55% from 8.91%, and annualized net charge-offs increased to 2.31% from 0.63%. The recreation lending segment saw 12% growth, while home improvement lending grew 6%. The bank maintained a strong Tier 1 leverage ratio of 16.14% and declared a quarterly dividend of $0.50 per share on its Series F Preferred Stock.
Medallion Bank (Nasdaq: MBNKP) ha riportato i risultati del secondo trimestre del 2024, mostrando performance miste. Il reddito netto è diminuito a 15,0 milioni di dollari rispetto ai 19,3 milioni dell'anno precedente, mentre il reddito netto da interessi è aumentato a 50,2 milioni di dollari da 47,0 milioni. Il portafoglio totale dei prestiti della banca è cresciuto del 10% anno su anno, raggiungendo i 2,3 miliardi di dollari. Tuttavia, il margine di interesse netto è calato all'8,55% rispetto all'8,91%, e le perdite nette annualizzate sono aumentate al 2,31% rispetto allo 0,63%. Il segmento di prestiti per attività ricreative ha visto una crescita del 12%, mentre i prestiti per miglioramenti della casa sono aumentati del 6%. La banca ha mantenuto un forte rapporto di leva Tier 1 del 16,14% e ha dichiarato un dividendo trimestrale di 0,50 dollari per azione sulle sue azioni privilegiate di Serie F.
Medallion Bank (Nasdaq: MBNKP) informó sus resultados del segundo trimestre de 2024, mostrando un rendimiento mixto. Los ingresos netos disminuyeron a 15,0 millones de dólares desde 19,3 millones en el mismo trimestre del año anterior, mientras que los ingresos netos por intereses aumentaron a 50,2 millones de dólares desde 47,0 millones. El portafolio total de préstamos del banco creció un 10% interanual, alcanzando los 2,3 mil millones de dólares. Sin embargo, el margen de interés neto disminuyó al 8,55% desde el 8,91%, y las cancelaciones netas anualizadas aumentaron al 2,31% desde el 0,63%. El segmento de préstamos para actividades recreativas vio un crecimiento del 12%, mientras que los préstamos para mejoras en el hogar crecieron un 6%. El banco mantuvo un fuerte ratio de apalancamiento Tier 1 del 16,14% y declaró un dividendo trimestral de 0,50 dólares por acción de su Serie F de acciones preferentes.
메달리온 뱅크(Nasdaq: MBNKP)는 2024년 2분기 실적을 발표하며 혼합된 성과를 보였습니다. 순이익이 감소했습니다; 작년 동기 1,930만 달러에서 1,500만 달러로 줄었습니다. 반면, 순이자 수익이 증가했습니다; 4700만 달러에서 5020만 달러로 올랐습니다. 은행의 총 대출 포트폴리오는 연간 10% 성장하여 23억 달러에 도달했습니다. 그러나 순이자 마진은 감소했습니다; 8.91%에서 8.55%로 떨어졌고, 연간 순 대손상각율이 증가했습니다; 0.63%에서 2.31%로 상승했습니다. 레크리에이션 대출 부문은 12% 성장했으며, 주택 개선 대출은 6% 증가했습니다. 이 은행은 16.14%의 강력한 Tier 1 레버리지 비율을 유지하고 있으며, F 시리즈 우선주에 대해 주당 0.50달러의 분기 배당금을 선언했습니다.
Medallion Bank (Nasdaq: MBNKP) a publié ses résultats du deuxième trimestre 2024, affichant des performances mitigées. Le revenu net a diminué à 15,0 millions de dollars contre 19,3 millions lors du trimestre de l'année précédente, tandis que le revenu net d'intérêts a augmenté à 50,2 millions de dollars contre 47,0 millions. Le portefeuille total de prêts de la banque a augmenté de 10% d'une année sur l'autre, atteignant 2,3 milliards de dollars. Cependant, la marge d'intérêt nette a diminué à 8,55% contre 8,91%, et les créances irrécouvrables annualisées ont augmenté à 2,31% contre 0,63%. Le segment des prêts récréatifs a connu une croissance de 12%, tandis que les prêts pour l'amélioration de l'habitat ont augmenté de 6%. La banque a maintenu un solide ratio de levier Tier 1 de 16,14% et a déclaré un dividende trimestriel de 0,50 dollar par action sur ses actions préférentielles de série F.
Medallion Bank (Nasdaq: MBNKP) hat seine Ergebnisse für das 2. Quartal 2024 veröffentlicht und zeigte eine gemischte Leistung. Der Nettogewinn sank auf 15,0 Millionen Dollar von 19,3 Millionen im Vorjahresquartal, während die Nettozinsüberschüsse stiegen auf 50,2 Millionen Dollar von 47,0 Millionen. Das Gesamtvolumen des Kreditportfolios der Bank wuchs um 10% im Jahresvergleich auf 2,3 Milliarden Dollar. Allerdings ging die Nettozinsspanne zurück auf 8,55% von 8,91%, und die annualisierten Nettowertberichtigungen stiegen auf 2,31% von 0,63%. Der Bereich der Freizeitkredite verzeichnete ein Wachstum von 12%, während die Kredite zur Wohnungsverbesserung um 6% zulegten. Die Bank hielt eine starke Tier-1-Leverage-Ratio von 16,14% und erklärte eine vierteljährliche Dividende von 0,50 Dollar pro Aktie ihrer Serie-F-Vorzugsaktien.
- Net interest income increased to $50.2 million from $47.0 million year-over-year
- Total loan portfolio grew 10% year-over-year to $2.3 billion
- Recreation loan portfolio grew 12% year-over-year to $1.497 billion
- Home improvement loan portfolio grew 6% year-over-year to $773.2 million
- Strong Tier 1 leverage ratio of 16.14% maintained
- Net income decreased to $15.0 million from $19.3 million year-over-year
- Net interest margin declined to 8.55% from 8.91% year-over-year
- Annualized net charge-offs increased to 2.31% from 0.63% year-over-year
- Total provision for credit losses increased to $18.2 million from $8.9 million year-over-year
- Delinquencies 30 days or more past due increased in both recreation and home improvement segments
Insights
Medallion Bank's Q2 2024 results present a mixed picture, with some positive developments offset by challenges. The 10% year-over-year growth in the total loan portfolio to
The bank's net interest income showed improvement, increasing to
Of particular concern is the sharp increase in annualized net charge-offs to
On a positive note, the bank maintains a strong capital position with a Tier 1 leverage ratio of
Overall, while Medallion Bank continues to grow its loan portfolio and maintain solid interest income, the increasing credit risk and declining profitability metrics warrant close monitoring by investors in the coming quarters.
The Q2 2024 results for Medallion Bank reveal a concerning trend in credit quality that demands attention. The substantial increase in the provision for credit losses to
Particularly worrying is the spike in annualized net charge-offs to
Delinquency rates have also climbed across both major lending segments. In the recreation portfolio, loans 30 days or more past due increased to
The bank's management appears to be responding to these challenges by tightening credit standards, as evidenced by President Donald Poulton's statement about prioritizing quality growth. However, the effectiveness of these measures remains to be seen and investors should closely monitor future quarters for signs of stabilization or further deterioration in credit metrics.
While the bank maintains a strong capital position, the rapid increase in credit losses could erode this buffer if the trend continues. The coming quarters will be important in determining whether this is a temporary spike or the beginning of a more prolonged credit cycle downturn for Medallion Bank.
Medallion Bank's Q2 2024 results offer valuable insights into consumer behavior and market trends in the recreational vehicle, boat and home improvement sectors. The 12% growth in the recreation loan portfolio to
However, the increase in delinquencies and charge-offs in the recreation segment raises questions about the sustainability of this demand. It could signal that some consumers may be overextending themselves financially to make these purchases, potentially due to pent-up demand following the pandemic or a desire to invest in experiences over material goods.
The home improvement loan portfolio's more modest 6% growth to
The bank's focus on "prudent balance sheet and credit risk management" and tightening of credit standards suggests a recognition of potential economic headwinds. This approach may lead to slower growth but could position the bank more favorably if economic conditions deteriorate.
The seasonality mentioned in loan growth is an important factor for investors to consider, as it impacts the bank's quarterly performance and provisioning needs. Understanding these cyclical patterns is important for accurately assessing the bank's performance and projecting future results.
Overall, while consumer demand remains robust, particularly in the recreation sector, the increasing credit risk indicators suggest a potential shift in the market. Investors and industry observers should watch for signs of whether this represents a temporary blip or the beginning of a broader consumer spending pullback in these discretionary sectors.
SALT LAKE CITY, July 30, 2024 (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 strategic partners, announced today its results for the quarter ended June 30, 2024. The Bank is a wholly owned subsidiary of Medallion Financial Corp. (Nasdaq: MFIN).
2024 Second Quarter Highlights
- Net income of
$15.0 million , compared to$19.3 million in the prior year quarter. - Net interest income of
$50.2 million , compared to$47.0 million in the prior year quarter. - Net interest margin of
8.55% , compared to8.91% in the prior year quarter. - Total provision for credit losses was
$18.2 million , compared to$8.9 million in the prior year quarter. Total provision for credit losses included$0.9 million of net taxi medallion recoveries, compared to$5.0 million of net taxi medallion recoveries in the prior year quarter. - Annualized net charge-offs were
2.31% of average loans outstanding, compared to0.63% in the prior year quarter. - Annualized return on assets and return on equity were
2.57% and16.77% , respectively, compared to3.66% and24.38% for the prior year period. - The total loan portfolio grew
10% from June 30, 2023 to$2.3 billion as of June 30, 2024. - Total assets were
$2.4 billion and the Tier 1 leverage ratio was16.14% at June 30, 2024.
Donald Poulton, President and Chief Executive Officer of Medallion Bank, stated, “Asset growth resumed in the second quarter, reflecting the seasonality of our business and ongoing strong demand for our lending programs. While loan growth will increase interest income, it comes at a short-term cost in the form of elevated credit loss provisions as we build the reserve for expected losses. Credit performance improvement during the quarter was notable. Both loan losses and delinquency fell compared to the first quarter, with recreation loan net charge-offs down 137 basis points and home improvement loan net charge-offs down 63 basis points. Our credit standards remained relatively tight as we prioritized quality growth that maintains our market position. Consistent with the last few quarters, our focus remains on prudent balance sheet and credit risk management.”
Recreation Lending Segment
- The Bank’s recreation loan portfolio grew
12% to$1.49 7 billion as of June 30, 2024, compared to$1.33 1 billion at June 30, 2023. - Net interest income was
$37.9 million , compared to$34.4 million in the prior year quarter. - Recreation loans were
66% of loans receivable as of June 30, 2024, compared to65% at June 30, 2023. - Annualized net charge-offs were
2.99% of average recreation loans outstanding, compared to1.87% in the prior year quarter. - Delinquencies 30 days or more past due were
$54.3 million , or3.75% , of recreation loans as of June 30, 2024, compared to$42.9 million , or3.33% , at June 30, 2023. - The provision for recreation credit losses was
$15.8 million , compared to$10.1 million in the prior year quarter.
Home Improvement Lending Segment
- The Bank’s home improvement loan portfolio grew
6% to$773.2 million as of June 30, 2024, compared to$728.5 million at June 30, 2023. - Net interest income was
$12.1 million , compared to$11.6 million in the prior year quarter. - Home improvement loans were
34% of loans receivable as of June 30, 2024, compared to35% at June 30, 2023. - Annualized net charge-offs were
1.49% of average home improvement loans outstanding, compared to1.12% in the prior year quarter. - Delinquencies 30 days or more past due were
$6.9 million , or0.89% , of home improvement loans as of June 30, 2024, compared to$5.3 million , or0.72% , at June 30, 2023. - The provision for home improvement credit losses was
$3.3 million , compared to$3.7 million in the prior year quarter.
Series F Preferred Stock Dividend
On July 25, 2024, the Bank’s Board of Directors declared a quarterly cash dividend of
About Medallion Bank
Medallion Bank specializes in providing consumer loans for the purchase of recreational vehicles, boats, and home improvements, along with 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 “remains” “ongoing” or the negative versions of these words or other comparable words or phrases of a future or forward-looking nature. These statements may relate to our future earnings, returns, capital levels, sources of funding, 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, 2023, 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. 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 STATEMENTS OF OPERATIONS (UNAUDITED) | |||||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
| (In thousands) | 2024 | 2023 | 2024 | 2023 | |||||||||||
| Total interest income | $ | 66,759 | $ | 58,287 | $ | 129,727 | $ | 111,221 | |||||||
| Total interest expense | 16,524 | 11,337 | 31,277 | 19,937 | |||||||||||
| Net interest income | 50,235 | 46,950 | 98,450 | 91,284 | |||||||||||
| Provision for credit losses | 18,190 | 8,857 | 35,192 | 12,716 | |||||||||||
| Net interest income after provision for credit losses | 32,045 | 38,093 | 63,258 | 78,568 | |||||||||||
| Other non-interest income | 869 | 263 | 1,471 | 295 | |||||||||||
| Non-interest expense | |||||||||||||||
| Salaries and benefits | 4,953 | 4,588 | 9,937 | 8,980 | |||||||||||
| Loan servicing | 3,049 | 2,901 | 5,916 | 5,716 | |||||||||||
| Collection costs | 1,569 | 1,506 | 2,974 | 2,963 | |||||||||||
| Regulatory fees | 888 | 781 | 1,865 | 1,463 | |||||||||||
| Professional fees | 385 | 495 | 817 | 1,162 | |||||||||||
| Information Technology | 273 | 267 | 541 | 498 | |||||||||||
| Occupancy and equipment | 226 | 211 | 433 | 413 | |||||||||||
| Other | 1,059 | 996 | 1,809 | 1,867 | |||||||||||
| Total non-interest expense | 12,402 | 11,745 | 24,292 | 23,062 | |||||||||||
| Income before income taxes | 20,512 | 26,611 | 40,437 | 55,801 | |||||||||||
| Provision for income taxes | 5,476 | 7,282 | 10,922 | 15,047 | |||||||||||
| Net income | $ | 15,036 | $ | 19,329 | $ | 29,515 | $ | 40,754 | |||||||
| Less: Preferred stock dividends | 1,512 | 1,512 | 3,024 | $ | 3,024 | ||||||||||
| Net income attributable to common shareholder | $ | 13,524 | $ | 17,817 | $ | 26,491 | $ | 37,730 | |||||||
| MEDALLION BANK BALANCE SHEETS (UNAUDITED) | |||||||||||
| (In thousands) | June 30, 2024 | December 31, 2023 | June 30, 2023 | ||||||||
| Assets | |||||||||||
| Cash and federal funds sold | $ | 119,457 | $ | 110,043 | $ | 97,492 | |||||
| Investment securities, available-for-sale | 55,830 | 54,282 | 53,692 | ||||||||
| Loans, inclusive of net deferred loan acquisition fees and costs | 2,274,740 | 2,100,338 | 2,063,963 | ||||||||
| Allowance for credit losses | (84,213 | ) | (79,283 | ) | (71,447 | ) | |||||
| Loans, net | 2,190,527 | 2,021,055 | 1,992,516 | ||||||||
| Loan collateral in process of foreclosure | 3,103 | 4,165 | 7,259 | ||||||||
| Fixed assets and right-of-use lease assets, net | 8,850 | 8,140 | 7,366 | ||||||||
| Deferred tax assets | 12,866 | 12,761 | 10,400 | ||||||||
| Accrued interest receivable and other assets | 52,759 | 51,610 | 51,244 | ||||||||
| Total assets | $ | 2,443,392 | $ | 2,262,056 | $ | 2,219,969 | |||||
| Liabilities and Shareholders’ Equity | |||||||||||
| Liabilities | |||||||||||
| Deposits and other funds borrowed | $ | 2,031,782 | $ | 1,866,657 | $ | 1,841,549 | |||||
| Accrued interest payable | 5,281 | 4,029 | 2,037 | ||||||||
| Income tax payable | 21,127 | 21,219 | 27,441 | ||||||||
| Other liabilities | 17,983 | 17,509 | 22,454 | ||||||||
| Due to affiliates | 983 | 849 | 823 | ||||||||
| Total liabilities | 2,077,156 | 1,910,263 | 1,894,304 | ||||||||
| Shareholder’s Equity | |||||||||||
| Series E Preferred stock | 26,303 | 26,303 | 26,303 | ||||||||
| Series F Preferred stock | 42,485 | 42,485 | 42,485 | ||||||||
| Common stock | 1,000 | 1,000 | 1,000 | ||||||||
| Additional paid in capital | 77,500 | 77,500 | 77,500 | ||||||||
| Accumulated other comprehensive loss, net of tax | (4,578 | ) | (4,529 | ) | (4,583 | ) | |||||
| Retained earnings | 223,526 | 209,034 | 182,960 | ||||||||
| Total shareholders’ equity | 366,236 | 351,793 | 325,665 | ||||||||
| Total liabilities and shareholders’ equity | $ | 2,443,392 | $ | 2,262,056 | $ | 2,219,969 | |||||
FAQ
What was Medallion Bank's (MBNKP) net income for Q2 2024?
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How did Medallion Bank's (MBNKP) recreation lending segment perform in Q2 2024?
What was Medallion Bank's (MBNKP) Tier 1 leverage ratio as of June 30, 2024?
