8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): October 30, 2023

MEDALLION FINANCIAL CORP.

(Exact name of registrant as specified in its charter)

Delaware

(State or other jurisdiction of incorporation)

001-37747

(Commission File Number)

04-3291176

(IRS Employer Identification No.)

437 MADISON AVENUE, 38th Floor

NEW YORK, New York 10022

(Address of Principal Executive Offices) (Zip Code)

(212) 328-2100

(Registrant’s Telephone Number, Including Area Code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share	MFIN	NASDAQ Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

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. 

Item 2.02 Results of Operations and Financial Condition.

Medallion Financial Corp. (the “Company”), issued a press release to the news media announcing, among other things, the Company’s results for the quarter ended September 30, 2023.

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 2.02. 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	Press release, dated October 30, 2023
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: October 30, 2023

MEDALLION FINANCIAL CORP.
By:	/s/ Anthony N. Cutrone
	Name: Anthony N. Cutrone
	Title: Chief Financial Officer

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EX-99.1

FOR IMMEDIATE RELEASE:

MEDALLION FINANCIAL CORP. REPORTS 2023 THIRD QUARTER RESULTS

NEW YORK, NY – October 30, 2023 – Medallion Financial Corp. (NASDAQ: MFIN, “Medallion” or the “Company”), a specialtyfinance company that originates and services loans in various consumer and commercial industries, along with offering loan origination services to fintech strategic partners, announced today its results for the quarter ended September 30, 2023.

2023 Third Quarter Highlights

•Net income was $11.2 million, or $0.48 per share, compared to $7.6 million, or $0.32 per share, in the prior year quarter.

•$5.7 million of cash was collected on taxi medallion-related assets, with recoveries resulting in earnings of $0.10 per share.

•Net interest income grew 16% to $48.8 million from $42.0 million in the prior year quarter.

•Net interest margin on net loans was 8.64%, compared to 8.91% in the prior year quarter, and on gross loans it was 8.35%, compared to 8.63% in the prior year quarter.

•Loan originations were $217.4 million, compared to $273.7 million in the prior year quarter.

•Loans grew 19% to $2.2 billion as of September 30, 2023, compared to $1.9 billion a year ago.

•The credit loss provision increased to $14.5 million from $10.0 million in the prior year quarter.

•Total assets grew to an all-time high of $2.6 billion at September 30, 2023, a 16% increase over September 30, 2022.

•Subsequent to September 30, 2023, the board of directors increased the quarterly dividend 25% to $0.10 per share.

Executive Commentary – Andrew Murstein, President of Medallion

“We continue to be pleased with our strong results. Our earnings of nearly $41 million for the first nine months of the year were up 32% compared to last year. This is our highest net income for the nine-months through September since we went public. Net interest income grew 16% over the prior year quarter and grew 4% from the second quarter.

With over $200 million of consumer loans originated during the quarter, we continued to increase market share while taking pro-active steps to increase credit standards, increase pricing, and moderate growth to a level sustainable with our long-term strategy. Cash collections related to our taxi medallion assets were $5.7 million, adding $0.10 to our bottom line. In October, we collected an additional $9.4 million from one of larger taxi medallion borrowers, which will result in a pre-tax gain of $8.0 million in the fourth quarter.

Our board of directors has authorized a 25% increase of our quarterly dividend to $0.10 per share beginning with the upcoming dividend payment next month, another sign of our commitment to providing sustainable shareholder value over the long-term.”

Business Segment Highlights

Recreation Lending Segment

•Originations were $92.6 million during the quarter, compared to $149.2 million a year ago.

•Recreation loans grew 15% to $1.3 billion as of September 30, 2023, compared to $1.2 billion a year ago.

•Recreation loans were 61% of total loans as of September 30, 2023, compared to 63% a year ago.

•Net interest income grew 13% to $35.6 million for the quarter, from $31.5 million in in the prior year quarter.

•The average interest rate was 14.73% at quarter-end, compared to 14.21% a year ago.

•Recreation loans 90 days or more past due were $5.9 million, or 0.45% of gross recreation loans, as of September 30, 2023, compared to $5.1 million, or 0.45%, a year ago.

Home Improvement Lending Segment

•Originations were $79.3 million during the quarter, compared to $100.5 million a year ago.

•Home improvement loans grew 30% to $750.5 million as of September 30, 2023, compared to $575.2 million a year ago.

•Home improvement loans were 34% of total loans as of September 30, 2023, compared to 31% a year ago.

•Net interest income grew 19% to $11.4 million for the quarter, from $9.6 million in the prior year quarter.

•The average interest rate was 9.38% at quarter-end, compared to 8.55% a year ago.

•Home improvement loans 90 days or more past due were $1.0 million, or 0.13% of gross home improvement loans, as of September 30, 2023, compared to $0.5 million, or 0.09%, a year ago.

Commercial Lending Segment

•Commercial loans were $100.3 million at September 30, 2023, compared to $93.7 million a year ago.

•The average interest rate on the portfolio was 12.91%, compared to 12.26% a year ago.

Medallion Lending Segment

•The Company collected $5.7 million of cash on taxi medallion-related assets during the quarter.

•Total net taxi medallion assets declined to $16.2 million (comprised of $2.2 million of loans net of allowance for credit losses and $14.0 million of loan collateral in process of foreclosure), a 41% reduction from a year ago, and represented less than 1% of the Company’s total assets, as of September 30, 2023.

Capital Allocation

Quarterly Dividend

•The Board of Directors increased the quarterly dividend to $0.10 per share, payable on November 30, 2023 to shareholders of record at the close of business on November 15, 2023.

Conference Call Information

The Company will host a conference call to discuss its third quarter financial results tomorrow, Tuesday, October 31, 2023, at 9:00 a.m. Eastern time.

In connection with its earnings release, the Company has updated its quarterly supplement presentation, which is now available at www.medallion.com.

How to Participate

•Date: Tuesday, October 31, 2023

•Time: 9:00 a.m. Eastern time

•U.S. dial-in number: (877) 407-0789

•International dial-in number: (201) 689-8562

•Live webcast: Link to Webcast of 3Q23 Earnings Call

A link to the live audio webcast of the conference call will also be available at the Company’s IR website.

Replay Information

The webcast replay will be available at the Company's IR website until the next quarter’s results are announced.

The conference call replay will be available following the end of the call through Tuesday, November 7.

•U.S. dial-in number: (844) 512-2921

•International dial-in number: (412) 317-6671

•Passcode: 1374 1580

About Medallion Financial Corp.

Medallion Financial Corp. (NASDAQ:MFIN) and its subsidiaries originate and service a growing portfolio of consumer loans and mezzanine loans in various industries. Key industries served include recreation (towable RVs and marine) and home improvement (replacement roofs, swimming pools, and windows). Medallion Financial Corp. is headquartered in New York City, NY, and its largest subsidiary, Medallion Bank, is headquartered in Salt Lake City, Utah. For more information, please visit www.medallion.com.

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Forward-Looking Statements

Please note that this press release contains forward-looking statements that involve risks and uncertainties relating to business performance, cash flow, net interest income and expenses, other expenses, earnings, growth, and our growth strategy. These statements are often, but not always, made using words or phrases such as “will” and “continue” or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. These statements relate to future public announcements of our earnings, the impact of the pending SEC litigation, expectations regarding our loan portfolio, including collections on our medallion loans, the potential for future asset growth, and market share opportunities. Medallion’s actual results may differ significantly from the results discussed in such forward-looking statements. For example, statements about the effects of the current economy, whether inflation or the risk of recession, operations, financial performance and prospects constitute forward-looking statements and are subject to the risk that the actual impacts may differ, possibly materially, from what is reflected in those forward-looking statements due to factors and future developments that are uncertain, unpredictable and in many cases beyond Medallion’s control. In addition to risks relating to the current economy, a description of certain risks to which Medallion is or may be subject, including risks related to the pending SEC litigation, please refer to the factors discussed under the heading “Risk Factors” in Medallion’s 2022 Annual Report on Form 10-K.

Company Contact:

Investor Relations

212-328-2176

InvestorRelations@medallion.com

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MEDALLION FINANCIAL CORP.

CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

(Dollars in thousands, except share and per share data)	September 30, 2023			December 31, 2022			September 30, 2022
Assets
Cash, cash equivalents, and federal funds sold	$	127,642		$	105,598		$	98,202
Investment and equity securities		63,717			58,785			59,024
Loans		2,203,038			1,916,953			1,855,510
Allowance for credit losses		(79,133	)		(63,845	)		(61,535	)
Net loans receivable		2,123,905			1,853,108			1,793,975
Goodwill and intangible assets, net		171,755			172,838			173,200
Loan collateral in process of foreclosure		15,923			21,819			24,331
Other assets		55,685			47,731			50,809
Total assets	$	2,558,627		$	2,259,879		$	2,199,541
Liabilities
Deposits	$	1,855,096		$	1,607,110		$	1,555,832
Long-term debt		218,137			214,320			219,448
Short-term borrowings		18,489			5,000			—
Deferred tax liabilities, net		23,131			26,753			26,132
Operating lease liabilities		7,075			8,408			8,580
Accounts payable and accrued expenses		39,437			27,764			29,660
Total liabilities		2,161,365			1,889,355			1,839,652
Total stockholders’ equity		328,474			301,736			291,101
Non-controlling interest in consolidated subsidiaries		68,788			68,788			68,788
Total equity		397,262			370,524			359,889
Total liabilities and equity	$	2,558,627		$	2,259,879		$	2,199,541
Number of shares outstanding		23,363,731			23,061,673			23,185,070
Book value per share	$	14.06		$	13.08		$	12.56

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MEDALLION FINANCIAL CORP.‌

CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)‌

	Three Months Ended September 30,						Nine Months Ended September 30,
(Dollars in thousands, except share and per share data)	2023			2022			2023			2022
Total interest income	$	65,886		$	51,694		$	183,455		$	142,108
Total interest expense		17,102			9,654			44,379			25,258
Net interest income		48,784			42,040			139,076			116,850
Provision for credit losses		14,532			10,047			27,045			21,046
Net interest income after provision for credit losses		34,252			31,993			112,031			95,804
Other income (loss)
Gain on sale of loans and medallion		1,417			518			4,578			5,061
Gain (loss) on equity investments		2,180			(1,123	)		2,189			2,985
Write-down of loan collateral in process of foreclosure		(30	)		(94	)		(303	)		(608	)
Other income, net		739			468			1,868			1,217
Total other income (loss), net		4,306			(231	)		8,332			8,655
Other expenses
Salaries and employee benefits		9,630			8,411			27,805			23,709
Loan servicing fees		2,501			2,159			7,084			6,231
Collection costs		1,583			1,593			4,729			3,935
Professional fees		1,148			3,722			4,223			12,106
Other expenses		4,227			3,524			12,643			10,274
Total other expenses		19,089			19,409			56,484			56,255
Income before income taxes		19,469			12,353			63,879			48,204
Income tax provision		6,727			3,205			18,582			12,892
Net income after taxes		12,742			9,148			45,297			35,312
Less: income attributable to the non-controlling interest		1,512			1,512			4,536			4,535
Total net income attributable to Medallion Financial Corp.	$	11,230		$	7,636		$	40,761		$	30,777
Basic net income per share	$	0.50		$	0.33		$	1.81		$	1.28
Diluted net income per share	$	0.48		$	0.32		$	1.77		$	1.26
Weighted average common shares outstanding
Basic		22,596,982			23,154,775			22,469,968			24,020,058
Diluted		23,392,901			23,510,645			23,067,944			24,332,776
Dividends declared per common share	$	0.08		$	0.08		$	0.24		$	0.24

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XML

Document and Entity Information	Oct. 30, 2023
Cover [Abstract]
Entity Registrant Name	MEDALLION FINANCIAL CORP.
Amendment Flag	false
Entity Central Index Key	0001000209
Document Type	8-K
Document Period End Date	Oct. 30, 2023
Entity Incorporation State Country Code	DE
Entity File Number	001-37747
Entity Tax Identification Number	04-3291176
Entity Address, Address Line One	437 MADISON AVENUE
Entity Address, Address Line Two	38th Floor
Entity Address, City or Town	NEW YORK
Entity Address, State or Province	NY
Entity Address, Postal Zip Code	10022
City Area Code	212
Local Phone Number	328-2100
Written Communications	false
Soliciting Material	false
Pre Commencement Tender Offer	false
Pre Commencement Issuer Tender Offer	false
Security 12b Title	Common Stock, par value $0.01 per share
Trading Symbol	MFIN
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	false