Medical Financial (NASDAQ: MFIN) reported Q2 EPS of ($0.60), versus $0.07 reported last year.

• Total assets reached $1.53 billion as of June 30, 2018
• Medallion loans are at the lowest level since 2003
• Net interest income before the provision for loan losses was $24.7 million, reflecting primarily the contributions of the consumer lending segments
• Net loss was $14.6 million, or $0.60 per share, a slight improvement from the first quarter, and included a charge of $6.7 million to establish a general reserve on medallion loans less than 90 days past due
• Net interest margin was 8.57% in the 2018 second quarter, compared to 6.64% in the prior year period on a combined basis with Medallion Bank
• Medallion’s net consumer lending portfolio was $790.7 million, and grew 10% from the prior quarter
• Earnings from Medallion’s consumer and commercial segments totaled $8.9 million in the quarter
• Provision for medallion loan losses was $24.8 million for the 2018 second quarter, down significantly from $62.7 million in the first quarter
• 90 day plus medallion loan delinquencies were 4.5% of gross medallion loans, down to $12 million, a significant improvement from $112 million one year ago

“We are pleased to present the Company as a consolidated entity this quarter and to be able to report as a bank holding company only for accounting purposes, beginning with the 2018 second quarter,” stated Andrew Murstein, President of Medallion Financial. “We continue to highlight the strength of our consumer and commercial lending segments as we remain focused on the strategy we laid out in 2017. Net interest income was $24.7 million, providing a solid foundation for our future growth.”

“When looking at our taxi medallion portfolio, we remain cautiously optimistic that prices have reached the floor, as we valued our nonperforming New York City medallion collateral at $181,000 and wheelchair accessible medallion collateral at $154,000. We reported the lowest delinquency rate as a percentage of the portfolio since the fourth quarter of 2015. As previously commented, we commend the New York City Council for passing a for-hire vehicle reform package which included, among other things, capping ride-hailing services and giving authority to the TLC to set minimum pay standards for those drivers. We hope such measures should not only level the playing field between taxis and ride-hailing services but also alleviate the congestion that has left our streets in a state of gridlock. In the last few years we have reserved or charged off over $300 million of medallion loans. Our goal, as the market further stabilizes and hopefully improves, is to recover as much of that amount as possible.”

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