Medallion Q2 2020 Earnings Report
Key Takeaways
Medallion Financial Corp. reported a net loss of $4.0 million, or $0.16 per share, for the second quarter of 2020. However, net interest income increased by 16% year-over-year, driven by the consumer lending segments. Consumer loan originations reached an all-time high, and the consumer loan portfolio surpassed $1.0 billion.
Net loss was $4.0 million, or $0.16 per share, compared to a net loss of $7.5 million in the prior year period.
Net interest income increased by 16% to $26.8 million, primarily due to the consumer lending segments.
Consumer loan originations reached an all-time high of $150.9 million, up 11% from the prior year quarter.
The consumer loan portfolio reached an all-time high of $1.0 billion in net outstandings.
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Medallion Revenue by Segment
Forward Guidance
Medallion expects to continue executing its strategy of growing consumer and commercial segments while reducing medallion-related exposure.
Positive Outlook
- Growing consumer and commercial segments.
- Reducing total medallion-related exposure.
- Medallion Capital was just approved for an additional $25 million of SBA leverage.
- Consumer lending products showing strong demand
- Bank began originating loans with its first fintech partner in the second quarter
Challenges Ahead
- Potential impact of COVID-19 pandemic on consumer and medallion lending segments.
- Increased loan loss provisions due to COVID-19 concerns.
- COVID-19 continues to have a significant impact on the NYC economy and the taxi industry.
- Recovery process for medallion portfolio is difficult to predict and will likely remain choppy.
- Lowered collateral value from $124,500 net to $119,500 net for NYC medallions