Medallion BK salt lake city utah · NASDAQ:MBNKO
Medallion BK salt lake city utah — Medallion Bank — Investor Presentation (December 2019)
26 slides from Medallion BK salt lake city utah's investor presentation, December 2019
Slide 1: Investor Presentation: Preferred Equity Offering
Investor Presentation Medallion Bank Preferred Equity Offering December 2019
Slide 2: Legal Disclaimer
Legal Disclaimer DISCLAIMER. The information contained herein has been prepared by Medallion Bank (“the Bank,” “we,” “us” and “our”) solely for informational purposes. This document does not constitute nor does it form part of an offer to sell or purchase, or the solicitation of an offer to sell or
Slide 3: Terms of Preferred Stock Offering
Terms of Preferred Stock Offering Issuer Medallion Bank (the “Bank”) Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock, Series F (fixed-rate period Security to but excluding April 1, 2025 and floating-rate period from and including April 1, 2025), par value $1.00 per share, with a liqu
Slide 4: Medallion Bank Overview
Medallion Bank Overview Wholly-owned, Utah-chartered Industrial Bank subsidiary of Medallion Financial Corp., a specialty bank that (i) originates Asset Mix at September 30, 2019 ($M) recreation loans (RVs, boats, motorcycles, trailers), (ii) originates home improvement loans (windows, roofs, swim
Slide 5: Investment Highlights
Investment Highlights Profitable, scalable and conservatively managed, $1.2 billion, FDIC-insured Utah-chartered Industrial Bank • Began operations in late-2003 and has been profitable each year since inception • A- rating from Egan-Jones • Four business segments – growing Recreation and Home Impr
Slide 6: Executive Management
Executive Management Donald Poulton President & Chief Executive Officer Mr. Poulton was a founding officer of Medallion Bank, serving as our Chief Lending Officer from the Bank’s formation in 2002 and becoming the Bank’s CEO in 2015. Mr. Poulton has over 40 years of experience in the banking indus
Slide 7: Executive Management (cont.)
Executive Management (cont.) Clifford Pedersen Senior Vice President & Chief Compliance Officer Mr. Pedersen joined Medallion Bank in 2016 and oversees the administration of the Bank’s Compliance Management Program. He also serves as the Community Reinvestment Officer and Anti-Money Laundering Off
Slide 8: Historical Balance Sheet Growth
Historical Balance Sheet Growth Assets ($M) Loans ¹ ($M) $1,159.2 $1,043.9 $1,079.8 $1,076.0 $1,077.4 $1,009.1 $1,007.5 $1,022.5 $964.0 $917.1 $923.8 $888.9 2014 2015 2016 2017 2018 2019Q3 2014 2015 2016 2017 2018 2019Q3 Deposits ($M) Equity ($M) $963.0 $180.3 $162.4 $161.9 $164.2 $167.0 $149.4 $908
Slide 9: Historical Loan Growth by Portfolio
Historical Loan Growth by Portfolio Recreation Loans ¹ ($M) Home Improvement Loans ² ($M) Excludes loan sales; See loan sale data provided in footnote Excludes loan sales; See loan sale data provided in footnote $693.5 $239.8 $235.3 $517.3 $580.8 $210.8 $468.7 $187.4 $415.3 $175.9 $344.8 $133.0 2014
Slide 10: Historical Earnings Growth
Historical Earnings Growth Pre-Tax Income ($M) - Yearly Pre-Tax Income ($M) - Quarterly $42.8 $42.7 $14.9 $11.9 $4.7 $1.7 $2.4 $2.8 $19.6 $17.1 2018 Q1 2018 Q2 2018 Q3 2018Q4 2019Q1 2019Q2 2019Q3 $9.2 $1.6 ($12.1) 2014 2015 2016 2017 2018 2019 Q3 YTD Pre-Provision, Pre-Tax Income ($M) - Yearly Pre-P
Slide 11: Historical Earnings Growth (Continued)
Historical Earnings Growth (Continued) Provision for Loan Losses ($M) - Yearly Provision for Loan Losses ($M) - Quarterly $69.5 $17.6 $15.2 $14.2 $51.3 $50.7 $11.2 $11.2 $32.7 $7.3 $6.6 $16.7 $8.1 2014 2015 2016 2017 2018 2019 Q3 YTD 2018 Q1 2018 Q2 2018 Q3 2018Q4 2019Q1 2019Q2 2019Q3 Net Income ($M
Slide 12: Historical Performance Metrics
Historical Performance Metrics Return on Average Assets (%) Return on Average Equity (%) 18.61% 2.92% 15.18% 2.33% 10.66% 1.70% 0.54% 3.51% 0.42% 2.71% 0.18% 1.15% 2014 2015 2016 2017 2018 2019 Q3 YTD 2014 2015 2016 2017 2018 2019 Q3 YTD Net Interest Margin (%) Efficiency Ratio (%) 9.69% 32.53% 33.0
Slide 13: Credit Quality
Credit Quality ALL / Total Loans (%) ALL / Nonperforming Loans (%) 426.01% 6.91% 6.51% 5.44% 5.61% 304.86% 183.19% 2.39% 121.45% 2.00% 91.68% 91.02% 2014 2015 2016 2017 2018 2019 Q3 2014 2015 2016 2017 2018 2019 Q3 Nonperforming Loans / Total Loans (%) Net Charge-Offs / Average Loans (%) 5.60% 5.98%
Slide 14: Regulatory Capital Ratios
Regulatory Capital Ratios Tier 1 Leverage Ratio (%) Tier 1 Risk-Based Capital Ratio (%) 16.90% 15.85% 15.91% 16.46% 15.44% 15.96% 16.06% 15.11% 15.03% 14.47% 14.53% 14.66% 2014 2015 2016 2017 2018 2019 Q3 2014 2015 2016 2017 2018 2019 Q3 Total Risk-Based Capital Ratio (%) Common Equity Tier 1 Ratio
Slide 15: Medallion Bank's 2019 Q3 Highlights
Medallion Bank’s 2019 Q3 Highlights Robust Earnings Continued Capital Strength & Credit Quality • $17.1 million in pre-tax income • Tier 1 leverage ratio increased to 15.91% • YTD ROAA of 1.70% & YTD Net Interest Margin of 9.69% Stabilization of Medallion Portfolio 2019 Net Interest Income ($M
Slide 16: Lines of Business
Lines of Business Consumer Lending Recreation Lending Home Improvement Lending Medallion Loan Portfolio High-growth business focused on Focused on high-quality, fixed-rate loans Medallion Bank stopped originating taxicab originating prime and non-prime loans for window, siding and roof replace
Slide 17: Recreation Lending Detail
Recreation Lending Detail Highlights Loan Portfolio Growth ¹ ($M) Largest and most profitable segment, accounting for 78.8% of Excludes loan sales; See loan sale data provided in footnote interest income for the nine months ended September 30, $693.5 2019 $517.3 $580.8 $468.7 Geographically dive
Slide 18: Home Improvement Lending Detail
Home Improvement Lending Detail Highlights Loan Portfolio Growth ¹ ($M) High-quality lending segment with large growth potential, Excludes loan sales; See loan sale data provided in footnote accounting for 22.5% of the loan portfolio as of September 30, 2019 $239.8 $235.3 • Growth is currently lim
Slide 19: Medallion Loan Portfolio Detail
Medallion Loan Portfolio Detail Highlights Loan Portfolio Growth ($M) Medallion Bank originated loans to finance the purchase of taxicab medallions until September 2014 and has since transitioned away from this aspect of its business $368.2 $341.7 Through consumer segment loan growth and conserv
Slide 20: Medallion Valuation Methodology
Medallion Valuation Methodology Valuation Methodology Medallion Valuations Different valuation methodologies are used for performing and New York medallion values have declined by less than $12,000 nonperforming medallion loans since 2018, as shown below. For all loans, no value has been assig
Slide 21: Pro Forma Capital Ratios
Pro Forma Capital Ratios (Dollar values in thousands) Pro Forma for Actual Preferred Equity 9/30/2019 Adjustments 9/30/2019 Regulatory Capital Common Equity Tier 1 Capital $153,580 $0 $153,580 Additional Tier 1 Capital $26,303 $24,000 $50,303 Tier 1 Capital $179,883 $24,000 $203,883 Tier 2 Capital $
Slide 22: Credit Risk Management
Credit Risk Management Proven Underwriting • While management continues to modernize underwriting practices, underwriting has remained fundamentally consistent since the Bank’s inception, providing a long-term view of underwriting effectiveness. Sound Judgment • Lending policies and procedures i
Slide 23: Asset / Liability Management
Asset / Liability Management Data as of August 31, 2019 Estimated Increase / (Decrease) to Interest Rate Change in Parallel Net Interest Income EVE + 400 bps (1.03%) 6.40% + 300 bps 0.42% 0.88% + 200 bps 0.91% (1.38%) + 100 bps 0.46% (0.49%) + 0 bps -- -- - 100 bps (0.48%) 0.31% - 200 bps (2.62%) 6.
Slide 24: Historical Balance Sheet
Historical Balance Sheet (Dollar values in thousands) For The Year Ended December 31, For The Quarter Ended, 2016 2017 2018 9/30/2019 Total Cash & Securities $67,742 $153,711 $79,319 $80,827 Total Loans & Leases $1,019,901 $928,232 $938,222 $1,061,713 Loan Loss Reserve ($54,819) ($63,416) ($60,137)
Slide 25: Historical Income Statement
Historical Income Statement (Dollar values in thousands) For the Year Ended December 31, Year-to-Date, 2016 2017 2018 9/30/2019 Interest Income on Loans $102,481 $109,993 $114,340 $91,561 Interest Income on Cash & Securities $973 $1,288 $1,733 $1,316 Total Interest Income $103,454 $111,281 $116,073
Slide 26: Historical Statement of Cash Flow
Historical Statement of Cash Flow (Dollar values in thousands) For The Year Ended December 31, Year-to-Date, 2016 2017 2018 9/30/2019 Cash Flows from Operating Activities Net Income from Operations $1,962 $4,553 $5,666 $13,748 Adjustments to Reconcile Net Income to Net Cash Flows Provided by Operati
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