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Medallion Financial Corp. (Nasdaq: TAXI), a specialty finance company with a leading position servicing the taxicab industry and other niche markets, announced that net income, or net increase in net assets resulting from operations was $5,632,000, or $0.32 per diluted common share in the 2011 fourth quarter, up from $4,667,000 or $0.27 per share in the 2010 fourth quarter. For the 2011 full year, net increase in net assets resulting from operations was $19,163,000 or $1.09 per diluted common share, up from $11,279,000 or $0.64 per share in 2010.
As the Company continues to use Medallion Bank as a primary funding source, it refers more loans to Medallion Bank for origination to take advantage of current short term borrowing costs as low as 0.4%. Medallion Financial’s net interest margin was 7.00% in the 2011 fourth quarter, up from 4.72% one year ago. The net interest margin for the year was 5.10%, up from 4.81% for the prior year. On a combined basis with Medallion Bank, the net interest margin increased to 6.68%, up from 6.59%, reflecting the reduced cost of funds at the bank. The net interest margins were the highest in the history of the Company.
Andrew Murstein, President of Medallion Financial stated, “We are extremely pleased with the year’s operating results. We continued to see strong taxi medallion collateral values demonstrated through price appreciation in taxi medallions throughout 2011. Prices in 2011 for corporate medallions in New York City increased during the year and reached $1,000,000 per medallion. We continue to experience zero losses on any New York City taxi medallion loan we have originated,” said Mr. Murstein. “The taxi industry remains resilient in this type of economic environment for several reasons such as corporate and consumer cutbacks on more expensive limousine and town car services, high taxi fleet utilization, and continuing high taxi ridership levels. In addition, the loan to value ratio on our entire medallion portfolio is approximately 40%.”