• Net Income (Q4 2024): $10.1 million
• Earnings Per Share (Q4 2024): $0.43
• Net Income (Full Year 2024): $35.9 million
• Earnings Per Share (Full Year 2024): $1.52
• Loan Originations (2024): Over $1 billion
• Net Gains from Portfolio Exits (Q4 2024): $3.8 million
• Net Gains from Portfolio Exits (Full Year 2024): $6.9 million
• Recreation Loan Originations (Q4 2024): $72 million
• Total Outstanding Recreation Loans: $1.5 billion
• Average Interest Rate on Recreation Loans: 15.07%
• Home Improvement Loan Originations (Q4 2024): $83 million
• Total Outstanding Home Improvement Loans: $827 million
• Average Interest Rate on Home Improvement Loans: 9.81%
• Commercial Loans (End of 2024): $111 million
• Average Interest Rate on Commercial Loans: 12.97%
• Cash Collected from Taxi Medallion Business (Q4 2024): $2.6 million
• Cash Collected from Taxi Medallion Business (Full Year 2024): $12.1 million
• Strategic Partnership Loan Volumes (Q4 2024): Increased from $40 million to $124 million
• Quarterly Dividend Increase: 10% to $0.11
• Share Repurchase (2024): Over 570,000 shares at $8.07 per share
• Net Interest Income (Q4 2024): $52 million
• Net Interest Margin (Q4 2024): 7.84%
• Total Loans Outstanding: $2.5 billion
• Provision for Credit Loss (Q4 2024): $20.6 million
• Operating Expenses (Q4 2024): $17.2 million
• Net Book Value Per Share (End of 2024): $16
• Adjusted Tangible Book Value Per Share (End of 2024): $10.50

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Release Date: March 05, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Medallion Financial Corp (NASDAQ:MFIN) achieved its highest quarterly net income in 2024, with $10.1 million in net income and $0.43 earnings per share.
• The company generated over $1 billion in loan originations for the first time in its history, maintaining high credit standards.
• The average FICO score for new loan originations improved, with recreational loans at 686 and home improvement loans at 781.
• The company successfully exited a portfolio investment, resulting in net gains of $3.8 million in the fourth quarter.
• The Board approved a 10% increase in the quarterly dividend, reflecting confidence in the company's future and commitment to shareholder value.

Negative Points

• Net interest margin on gross loans decreased by 27 basis points from the prior quarter and 36 basis points from a year ago.
• Two commercial loans were placed on nonaccrual, resulting in a reversal of $427,000 in interest income, impacting yield.
• Provision for credit loss increased to $20.6 million for the quarter, up from $10.8 million in the prior year quarter.
• Net charge-offs in the recreation portfolio were $16.9 million, or 4.35% of the average portfolio.
• Operating expenses included a $3 million charge related to an SEC settlement, impacting overall expenses.

Q & A Highlights

Q: Can you provide some color around why you are selling the $121 million of the rec loans and when you expect that to close? A: Andrew Murstein, President and COO: We are selling it because the volume was stronger than anticipated during the year. It gives us another good funding option. If growth continues to exceed expectations in 2025, we could revisit this. The sale is expected to close in the next 30 to 60 days.

Q: How are you feeling about credit quality going forward and delinquency levels? Are they peaking currently? A: Anthony Cutrone, CFO: Q4 is typically when delinquencies and charge-offs peak, then settle towards the end of Q1. We are seeing better performance in recent vintages, which aligns with tightened credit standards since mid-2023.

Q: Can you provide additional color about margins and if you see them bottoming in 2025? A: Anthony Cutrone, CFO: We are hesitant to call a bottom due to the decoupling of our borrowing costs from Fed decisions. We are originating loans at higher rates than our average coupon, which should counteract any increase in cost of funds.

Q: Can you provide some additional color about loan growth currently and throughout 2025? A: Anthony Cutrone, CFO: We see demand for home improvement and recreation loans. We expect portfolio growth in 2025 to be mid- to high single digits, which is appropriate given our $2.5 billion loan book and current earnings.

Q: How should we think about operating expenses going forward? A: Anthony Cutrone, CFO: Operating expenses are expected to be around $21 million to $21.5 million per quarter. This increase is due to growth and initiatives related to loan systems and analytics, which will be offset by increased income.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.