Parent Company Only Condensed Financial Statements

12 Months Ended

Dec. 31, 2022

Condensed Financial Information Disclosure [Abstract]

Parent Company Only Condensed Financial Statements

(17) PARENT COMPANY ONLY CONDENSED FINANCIAL STATEMENTS

The following shows the condensed financial information of Medallion Financial Corp. (parent company only).

Condensed Balance Sheets

	December 31,
(Dollars in thousands)	2022		2021
Assets
Cash	$	20,669	$	40,540
Investment in bank subsidiary(1)		479,496		367,945
Investment in non-bank subsidiaries		83,727		88,018
Income tax receivable		22,835		18,763
Loan collateral in process of foreclosure		2,001		5,811
Net loans receivable		2,538		3,302
Other assets		7,603		8,674
Total assets	$	618,869	$	533,053
Liabilities
Long-term borrowings(2)	$	151,808	$	151,103
Deferred tax liabilities		38,091		35,799
Intercompany payables		33,378		39,703
Other liabilities		25,068		19,408
Total liabilities		248,345		246,013
Total stockholders’ equity		370,524		287,040
Total liabilities and equity	$	618,869	$	533,053

(1)Includes $172.8 million and $174.3 million of goodwill and intangible assets of the Company which relate specifically to the Bank.

(2)Includes $2.1 million and $2.9 million of deferred financing costs as of December 31, 2022 and 2021.

Condensed Statements of Operations

	Year Ended December 31,
(Dollars in thousands)	2022			2021			2020
Interest and dividend income	$	24,631		$	16,446		$	4,773
Interest expense		11,289			11,209			8,602
Net interest income (loss)		13,342			5,237			(3,829	)
Provision (benefit) for loan losses		(353	)		(4,718	)		5,127
Net interest income (loss) after provision for loan losses		13,695			9,955			(8,956	)
Other expense, net		(18,423	)		(6,224	)		(22,062	)
Income (loss) before income taxes and undistributed earnings of subsidiaries		(4,728	)		3,731			(31,018	)
Income tax benefit		7,940			4,452			10,454
Income (loss) before undistributed earnings of subsidiaries		3,212			8,183			(20,564	)
Undistributed earnings (losses) of subsidiaries		40,628			45,925			(14,219	)
Net income (loss) attributable to parent company	$	43,840		$	54,108		$	(34,783	)

Condensed Statements of Other Comprehensive Income (Loss)

	Year Ended December 31,
(Dollars in thousands)	2022			2021			2020
Net (income) loss	$	43,840		$	54,108		$	(34,783	)
Other comprehensive income (loss)		(4,383	)		(978	)		1,013
Total comprehensive income (loss) attributable to Medallion    Financial Corp.	$	39,457		$	53,130		$	(33,770	)

Condensed Statements of Cash Flow

	Year Ended December 31,
(Dollars in thousands)	2022			2021			2020
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss)/net decrease in net assets resulting from operations	$	43,840		$	54,108		$	(34,783	)
Adjustments to reconcile net income (loss)/net decrease in net assets resulting from operations    to net cash provided by operating activities:
Equity in undistributed (earnings) losses of subsidiaries		(64,300	)		(60,304	)		6,622
(Benefit) provision for loan losses		(353	)		(4,718	)		5,127
Depreciation and amortization		2,740			4,485			5,357
Change in deferred and other tax assets/liabilities, net		(1,780	)		(5,666	)		(3,317	)
Net change in loan collateral in process of foreclosure		64			1,619			4,940
Net change in unrealized depreciation on investments		—			—			3,493
Gain on extinguishment of debt		—			(2,204	)		—
Net realized gains on sale of investments		—			(11,701	)		—
Stock-based compensation expense		3,476			2,261			2,031
Decrease (increase) in other assets		1,055			(1,150	)		2,299
Increase in deferred financing costs		(39	)		(1,504	)		(1,233	)
Decrease in intercompany payables		(6,325	)		(11,649	)		(3,552	)
(Decrease) increase in other liabilities		5,430			(1,894	)		2,336
Net cash used for operating activities		(16,192	)		(38,317	)		(10,680	)
CASH FLOWS FROM INVESTING ACTIVITIES
Loans originated		(92	)		—			(14	)
Proceeds from principal receipts, sales, and maturities of loans and investments		723			28,552			1,193
Purchases of investments		—			(90	)		(2,304	)
Proceeds from sale and principal payments of loan collateral in process of foreclosure		3,697			666			1,276
Investment in subsidiaries		(4,750	)		(3,500	)
Dividends from subsidiaries		24,750			19,000			7,597
Net cash provided by investing activities		24,328			44,628			7,748
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from funds borrowed		—			51,400			33,600
Repayments of funds borrowed		—			(51,155	)		(1,402	)
Treasury stock repurchased		(20,619	)		—			—
Dividends paid to shareholders		(7,543	)		—			—
Proceeds from the exercise of stock options		155			241			—
Net cash (used for) provided by financing activities		(28,007	)		486			32,198
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS		(19,871	)		6,797			29,266
Cash and cash equivalents, beginning of period		40,540			33,743			4,477
Cash and cash equivalents, end of period	$	20,669		$	40,540		$	33,743