XML 49 R32.htm IDEA: XBRL DOCUMENT v3.22.4
Loans and Allowance for Loan Losses (Tables)
 12 Months Ended
Dec. 31, 2022
Text Block [Abstract]  
Summary of Inclusive Capitalized Loans

The following table shows the major classification of loans, inclusive of capitalized loan origination costs, at December 31, 2022 and 2021.

 

 

As of December 31,

 

 

 

2022

 

 

2021

 

(Dollars in thousands)

 

Amount

 

 

As a
Percent of
Gross Loans

 

 

Amount

 

 

As a
Percent of
Gross Loans

 

Recreation

 

$

1,183,512

 

 

 

62

%

 

$

961,320

 

 

 

65

%

Home improvement

 

 

626,399

 

 

 

33

 

 

 

436,772

 

 

 

29

 

Commercial

 

 

92,899

 

 

 

5

 

 

 

76,696

 

 

 

5

 

Medallion

 

 

13,571

 

 

 

1

 

 

 

14,046

 

 

 

1

 

Strategic partnership

 

 

572

 

 

*

 

 

 

90

 

 

*

 

Total gross loans

 

 

1,916,953

 

 

 

100

%

 

 

1,488,924

 

 

 

100

%

Allowance for loan losses

 

 

(63,845

)

 

 

 

 

 

(50,166

)

 

 

 

Total net loans

 

$

1,853,108

 

 

 

 

 

$

1,438,758

 

 

 

 

(*) Less than 1%.
Schedule of Activity of Gross Loans

The following tables show the activity of the gross loans for the years ended December 31, 2022 and 2021.


(Dollars in thousands)

 

Recreation

 

 

Home
Improvement

 

 

Commercial

 

 

Medallion

 

 

Strategic
Partnership

 

 

Total

 

Gross loans – December 31, 2021

 

$

961,320

 

 

$

436,772

 

 

$

76,696

 

 

$

14,046

 

 

$

90

 

 

$

1,488,924

 

Loan originations

 

 

513,062

 

 

 

392,543

 

 

 

28,172

 

 

 

605

 

 

 

49,526

 

 

 

983,908

 

Principal payments, sales, maturities, and recoveries

 

 

(259,326

)

 

 

(196,203

)

 

 

(6,610

)

 

 

(419

)

 

 

(49,044

)

 

 

(511,602

)

Charge-offs

 

 

(27,055

)

 

 

(6,393

)

 

 

(6,083

)

 

 

(314

)

 

 

—

 

 

 

(39,845

)

Transfer to loan collateral in process of foreclosure, net

 

 

(12,444

)

 

 

—

 

 

 

—

 

 

 

(347

)

 

 

—

 

 

 

(12,791

)

Amortization of origination costs

 

 

(10,470

)

 

 

1,763

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(8,707

)

Amortization of loan premium

 

 

(213

)

 

 

(322

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(535

)

FASB origination costs, net

 

 

18,638

 

 

 

(1,761

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

16,877

 

Paid-in-kind interest

 

 

—

 

 

 

—

 

 

 

724

 

 

 

—

 

 

 

—

 

 

 

724

 

Gross loans – December 31, 2022

 

$

1,183,512

 

 

$

626,399

 

 

$

92,899

 

 

$

13,571

 

 

$

572

 

 

$

1,916,953

 

 

 


(Dollars in thousands)

 

Recreation

 

 

Home
Improvement

 

 

Commercial

 

 

Medallion

 

 

Strategic
Partnership

 

 

Total

 

Gross loans – December 31, 2020

 

$

792,686

 

 

$

334,033

 

 

$

65,327

 

 

$

37,768

 

 

$

24

 

 

$

1,229,838

 

Loan originations

 

 

441,921

 

 

 

258,038

 

 

 

36,415

 

 

 

—

 

 

 

10,997

 

 

 

747,371

 

Principal payments, sales, maturities, and recoveries

 

 

(252,293

)

 

 

(153,044

)

 

 

(25,873

)

 

 

(1,363

)

 

 

(10,931

)

 

 

(443,504

)

Charge-offs

 

 

(14,712

)

 

 

(2,949

)

 

 

—

 

 

 

(15,287

)

 

 

—

 

 

 

(32,948

)

Transfer to loan collateral in process of foreclosure, net

 

 

(10,431

)

 

 

—

 

 

 

—

 

 

 

(5,457

)

 

 

—

 

 

 

(15,888

)

Amortization of origination costs

 

 

(9,678

)

 

 

1,671

 

 

 

13

 

 

 

(2

)

 

 

—

 

 

 

(7,996

)

Amortization of loan premium

 

 

(221

)

 

 

(346

)

 

 

—

 

 

 

(1,615

)

 

 

—

 

 

 

(2,182

)

FASB origination costs, net

 

 

14,048

 

 

 

(631

)

 

 

—

 

 

 

2

 

 

 

—

 

 

 

13,419

 

Paid-in-kind interest

 

 

—

 

 

 

—

 

 

 

814

 

 

 

—

 

 

 

—

 

 

 

814

 

Gross loans – December 31, 2021

 

$

961,320

 

 

$

436,772

 

 

$

76,696

 

 

$

14,046

 

 

$

90

 

 

$

1,488,924

 
Summary of Activity in Allowance for Loan Losses

The following table sets forth the activity in the allowance for loan losses for the years ended December 31, 2022 and 2021.

 

 

December 31,

 

(Dollars in thousands)

 

2022

 

 

2021

 

Allowance for loan losses – beginning balance

 

$

50,166

 

 

$

57,548

 

Charge-offs

 

 

 

 

 

 

Recreation

 

 

(27,055

)

 

 

(14,712

)

Home improvement

 

 

(6,393

)

 

 

(2,949

)

Commercial

 

 

(6,083

)

 

 

—

 

Medallion

 

 

(314

)

 

 

(15,287

)

Total charge-offs

 

 

(39,845

)

 

 

(32,948

)

Recoveries

 

 

 

 

 

 

Recreation

 

 

13,785

 

 

 

12,131

 

Home improvement

 

 

2,761

 

 

 

2,398

 

Commercial

 

 

47

 

 

 

—

 

Medallion

 

 

6,872

 

 

 

6,415

 

Total recoveries

 

 

23,465

 

 

 

20,944

 

Net charge-offs (1)

 

 

(16,380

)

 

 

(12,004

)

Provision for loan losses

 

 

30,059

 

 

 

4,622

 

Allowance for loan losses – ending balance (2)

 

$

63,845

 

 

$

50,166

 
(1)
As of December 31, 2022, cumulative charge-offs of loans and loan collateral in process of foreclosure in the medallion loan portfolio were $244.2 million, some of which represent collection opportunities for the Company.
(2)
As of December 31, 2022 and 2021, there was no allowance for loan losses and net charge-offs related to the strategic partnership loans.
Summary of Allowance for Loan Losses by Type

The following tables set forth the allowance for loan losses by type as of December 31, 2022 and 2021.

December 31, 2022
(Dollars in thousands)

 

Amount

 

 

Percentage
of Allowance

 

 

Allowance as
a Percent of
Loan Category

 

 

Allowance as
a Percent of
Nonaccrual

 

Recreation

 

$

41,966

 

 

 

66

%

 

 

3.55

%

 

 

130.60

%

Home improvement

 

 

11,340

 

 

 

18

 

 

 

1.81

 

 

 

35.29

 

Commercial

 

 

1,049

 

 

 

1

 

 

 

1.13

 

 

 

3.26

 

Medallion

 

 

9,490

 

 

 

15

 

 

 

69.93

 

 

 

29.53

 

Total

 

$

63,845

 

 

 

100

%

 

 

3.33

%

 

 

198.69

%

 

December 31, 2021
(Dollars in thousands)

 

Amount

 

 

Percentage
of Allowance

 

 

Allowance as
a Percent of
Loan Category

 

 

Allowance as
a Percent of
Nonaccrual

 

Recreation

 

$

32,435

 

 

 

64

%

 

 

3.37

%

 

 

91.18

%

Home improvement

 

 

7,356

 

 

 

15

 

 

 

1.68

 

 

20.68

 

Commercial

 

 

1,141

 

 

 

2

 

 

 

1.49

 

 

3.21

 

Medallion

 

 

9,234

 

 

 

19

 

 

 

65.74

 

 

 

25.96

 

Total

 

$

50,166

 

 

 

100

%

 

 

3.37

%

 

 

141.03

%
Summary of Total Nonaccrual Loans and Foregone Interest

The following table presents total nonaccrual loans and foregone interest, substantially all of which is in the medallion portfolio. The fluctuation in nonaccrual interest foregone is due to past due loans and market conditions.

 

 

Year Ended December 31,

 

(Dollars in thousands)

 

2022

 

 

2021

 

 

2020

 

Total nonaccrual loans

 

$

32,133

 

 

$

35,571

 

 

$

61,767

 

Interest foregone for the year

 

 

1,267

 

 

 

1,620

 

 

 

3,311

 

Amount of foregone interest applied to principal for the year

 

 

375

 

 

 

432

 

 

 

602

 

Interest foregone life-to-date

 

 

2,419

 

 

 

3,623

 

 

 

5,252

 

Amount of foregone interest applied to principal life-to-date

 

 

1,204

 

 

 

942

 

 

 

792

 

Percentage of nonaccrual loans to gross loan portfolio

 

 

1.7

%

 

 

2.4

%

 

 

5.0

%

Percentage of allowance for loan losses to nonaccrual loans

 

 

198.7

%

 

 

141.0

%

 

 

93.0

%

 
Summary of Performance Status of Loan

The following tables present the performance status of loans as of December 31, 2022 and 2021.

December 31, 2022
(Dollars in thousands)

 

Performing

 

 

Nonperforming

 

 

Total

 

 

Percentage of
Nonperforming
to Total

 

Recreation

 

$

1,173,846

 

 

$

9,666

 

 

$

1,183,512

 

 

 

0.82

%

Home improvement

 

 

625,820

 

 

 

579

 

 

 

626,399

 

 

 

0.09

 

Commercial

 

 

84,165

 

 

 

8,734

 

 

 

92,899

 

 

 

9.40

 

Medallion

 

 

—

 

 

 

13,571

 

 

 

13,571

 

 

 

100.00

 

Strategic partnership

 

 

572

 

 

 

—

 

 

 

572

 

 

 

—

 

Total

 

$

1,884,403

 

 

$

32,550

 

 

$

1,916,953

 

 

 

1.70

%

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2021
(Dollars in thousands)

 

Performing

 

 

Nonperforming

 

 

Total

 

 

Percentage of
Nonperforming
to Total

 

Recreation

 

$

955,763

 

 

$

5,557

 

 

$

961,320

 

 

 

0.58

%

Home improvement

 

 

436,640

 

 

 

132

 

 

 

436,772

 

 

 

0.03

 

Commercial

 

 

60,366

 

 

 

16,330

 

 

 

76,696

 

 

 

21.29

 

Medallion

 

 

—

 

 

 

14,046

 

 

 

14,046

 

 

 

100.00

 

Strategic partnership

 

 

90

 

 

 

—

 

 

 

90

 

 

 

—

 

Total

 

$

1,452,859

 

 

$

36,065

 

 

$

1,488,924

 

 

 

2.42

%

For those loans aged under 90 days past due, there is a possibility that their delinquency status will continue to deteriorate and they will subsequently be placed on nonaccrual status and be reserved for, and as such, deemed nonperforming.
Summary of Attributes of Nonperforming Loan Portfolio

The following tables provide additional information on attributes of the nonperforming loan portfolio as of December 31, 2022 and 2021, all of which had an allowance recorded against the principal balance.

 

 

December 31,

 

 

 

2022

 

 

2021

 

(Dollars in thousands)

 

Recorded
Investment

 

 

Unpaid
Principal
Balance

 

 

Related
Allowance

 

 

Recorded
Investment

 

 

Unpaid
Principal
Balance

 

 

Related
Allowance

 

With an allowance recorded

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Recreation

 

$

9,666

 

 

$

9,666

 

 

$

343

 

 

$

5,557

 

 

$

5,557

 

 

$

188

 

Home improvement

 

 

579

 

 

 

579

 

 

 

10

 

 

 

132

 

 

 

132

 

 

 

2

 

Commercial

 

 

8,734

 

 

 

8,823

 

 

 

963

 

 

 

16,330

 

 

 

16,360

 

 

 

1,141

 

Medallion

 

 

13,571

 

 

 

14,686

 

 

 

9,490

 

 

 

14,046

 

 

 

14,958

 

 

 

8,837

 

Total nonperforming loans with an allowance

 

$

32,550

 

 

$

33,754

 

 

$

10,806

 

 

$

36,065

 

 

$

37,007

 

 

$

10,168

 

 

 

 

Year Ended December 31,

 

 

 

2022

 

 

2021

 

(Dollars in thousands)

 

Average
Investment
Recorded

 

 

Interest Income
Recognized

 

 

Average
Investment
Recorded

 

 

Interest Income
Recognized

 

With an allowance recorded

 

 

 

 

 

 

 

 

 

 

 

 

Recreation

 

$

9,093

 

 

$

401

 

 

$

5,618

 

 

$

515

 

Home improvement

 

 

514

 

 

 

4

 

 

 

108

 

 

 

—

 

Commercial

 

 

13,381

 

 

 

—

 

 

 

16,816

 

 

 

93

 

Medallion

 

 

16,019

 

 

 

—

 

 

 

17,538

 

 

 

—

 

Total nonperforming loans with an allowance

 

$

39,007

 

 

$

405

 

 

$

40,080

 

 

$

608

 

 
Summary of Aging of Loans

The following tables show the aging of all loans as of December 31, 2022 and 2021.

December 31, 2022

 

Days Past Due

 

 

 

 

 

 

 

 

 

 

 

Recorded
Investment
90 Days and

 

(Dollars in thousands)

 

30-59

 

 

60-89

 

 

90 +

 

 

Total

 

 

Current

 

 

Total (1)

 

 

Accruing

 

Recreation

 

$

31,781

 

 

$

11,877

 

 

$

7,365

 

 

$

51,023

 

 

$

1,095,072

 

 

$

1,146,095

 

 

$

—

 

Home improvement

 

 

3,266

 

 

 

1,256

 

 

 

579

 

 

 

5,101

 

 

 

623,776

 

 

 

628,877

 

 

 

—

 

Commercial

 

 

—

 

 

 

—

 

 

 

74

 

 

 

74

 

 

 

93,396

 

 

 

93,470

 

 

 

—

 

Medallion

 

 

142

 

 

 

393

 

 

 

885

 

 

 

1,420

 

 

 

12,151

 

 

 

13,571

 

 

 

—

 

Strategic partnership

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

572

 

 

 

572

 

 

 

—

 

Total

 

$

35,189

 

 

$

13,526

 

 

$

8,903

 

 

$

57,618

 

 

$

1,824,967

 

 

$

1,882,585

 

 

$

—

 
(1)
Excludes $34.9 million of capitalized loan origination costs.

 December 31, 2021

 

Days Past Due

 

 

 

 

 

 

 

 

 

 

 

Recorded
Investment
90 Days and

 

(Dollars in thousands)

 

30-59

 

 

60-89

 

 

90 +

 

 

Total

 

 

Current

 

 

Total (1)

 

 

Accruing

 

Recreation

 

$

20,037

 

 

$

6,569

 

 

$

3,818

 

 

$

30,424

 

 

$

901,435

 

 

$

931,859

 

 

$

—

 

Home improvement

 

 

1,517

 

 

 

479

 

 

 

132

 

 

 

2,128

 

 

 

436,803

 

 

 

438,931

 

 

 

—

 

Commercial

 

 

1,795

 

 

 

—

 

 

 

74

 

 

 

1,869

 

 

 

74,827

 

 

 

76,696

 

 

 

—

 

Medallion

 

 

215

 

 

 

7,125

 

 

 

—

 

 

 

7,340

 

 

 

6,706

 

 

 

14,046

 

 

 

—

 

Strategic partnership

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

90

 

 

 

90

 

 

 

—

 

Total

 

$

23,564

 

 

$

14,173

 

 

$

4,024

 

 

$

41,761

 

 

$

1,419,861

 

 

$

1,461,622

 

 

$

—

 
(1)
Excludes loan premiums of $0.5 million and $26.8 million of capitalized loan origination costs.
Summary of TDRs

The following table shows the TDRs which the Company entered into during the year ended December 31, 2022.

(Dollars in thousands)

 

Number of Loans

 

 

Pre-
Modification
Investment

 

 

Post-
Modification
Investment

 

Recreation loans

 

 

80

 

 

 

1,203

 

 

 

1,203

 

Medallion loans

 

 

2

 

 

 

252

 

 

 

252

 

The following table shows the TDRs which the Company entered into during the year ended December 31, 2021.

(Dollars in thousands)

 

Number of Loans

 

 

Pre-
Modification
Investment

 

 

Post-
Modification
Investment

 

Recreation loans

 

 

56

 

 

 

668

 

 

 

585

 

Medallion loans

 

 

11

 

 

 

3,071

 

 

 

3,071

 
Summary of Activities of the Loan Collateral Process of Foreclosure Related to Recreation and Medallion Loans

The following tables show the activity of the loan collateral in process of foreclosure, which relates only to the recreation and medallion loans, for the years ended December 31, 2022 and 2021.

Year Ended December 31, 2022
(Dollars in thousands)

 

Recreation

 

 

Medallion(1)

 

 

Total

 

Loan collateral in process of foreclosure – December 31, 2021

 

$

1,720

 

 

$

35,710

 

 

$

37,430

 

Transfer from loans, net

 

 

12,444

 

 

 

347

 

 

 

12,791

 

Sales

 

 

(7,707

)

 

 

(2,668

)

 

 

(10,375

)

Cash payments received

 

 

—

 

 

 

(12,289

)

 

 

(12,289

)

Collateral valuation adjustments

 

 

(5,081

)

 

 

(657

)

 

 

(5,738

)

Loan collateral in process of foreclosure – December 31, 2022

 

$

1,376

 

 

$

20,443

 

 

$

21,819

 
(1)
As of December 31, 2022, medallion loans in the process of foreclosure included 452 medallions in the New York market, 335 medallions in the Chicago market, 54 medallions in the Newark market, and 39 medallions in various other markets.

Year Ended December 31, 2021
(Dollars in thousands)

 

Recreation

 

 

Medallion(1)

 

 

Total

 

Loan collateral in process of foreclosure – December 31, 2020

 

$

1,432

 

 

$

53,128

 

 

$

54,560

 

Transfer from loans, net

 

 

10,431

 

 

 

5,457

 

 

 

15,888

 

Sales

 

 

(6,951

)

 

 

(2,928

)

 

 

(9,879

)

Cash payments received

 

 

—

 

 

 

(14,173

)

 

 

(14,173

)

Collateral valuation adjustments

 

 

(3,192

)

 

 

(5,774

)

 

 

(8,966

)

Loan collateral in process of foreclosure – December 31, 2021

 

$

1,720

 

 

$

35,710

 

 

$

37,430

 
(1)
As of December 31, 2021, medallion loans in the process of foreclosure included 516 medallions in the New York market, 335 medallions in the Chicago market, 62 medallions in the Newark market, and 48 medallions in various other markets.