NEW YORK (AP) ¿ Medallion Financial Corp., a finance company serving the taxicab industry, said Friday it swung to a $5.8 million loss in the fourth quarter as it made allowances for investments that are no longer being pursued.
The value of those investments was about $9.3 million, the company said. Medallion Financial said it lost 33 cents a share, in the October-December period, compared with a profit of $2.8 million, or 16 cents a share, in the fourth quarter of 2008.
Without the special allowances, New York-based Medallion Financial said it would have earned $3.6 million, or 20 cents a share, in the last quarter.
Medallion Financial's president, Andrew Murstein, said the company looked at more than 100 possible acquisitions "and did not feel any of the targets were appropriate to recommend to our shareholders for a vote."Murstein said the company continued to benefit from solid collateral for the loans it made because the price of taxi medallions, or licenses, has been rising. The company hasn't had any losses on taxi medallion loans made in New York City, he said. Medallion Financial says it has loaned more than $3.5 billion to the taxi industry and other small businesses. The tax industry remains resilient despite the distressed economy because consumers and companies have cut back on more expensive limousine and town-car services, and taxi ridership continues at high levels, said Murstein. The company's net investment income in the fourth quarter was $8.2 million, down from $15.1 million a year earlier. On a combined basis with its subsidiary Medallion Bank it was nearly unchanged at $24.7 million. Medallion Bank received $9.7 million under the federal financial bailout program. In addition, a $30 billion small-business lending fund for banks recently proposed by President Barack Obama could benefit Medallion Financial if it is approved by Congress, company officials said Friday.