Medallion Financial's Q3 Net Income Dips, YTD Soars on Loan Growth

TL;DR

**MBNKO's Q3 net income dip is a blip; YTD growth and loan expansion show underlying strength, making it a buy on any weakness.**

AI Summary

MEDALLION FINANCIAL CORP. (MBNKO) reported a net income attributable to stockholders of $7.76 million for the three months ended September 30, 2025, a decrease of 9.8% from $8.61 million in the same period of 2024. However, for the nine months ended September 30, 2025, net income attributable to stockholders increased by 19.8% to $30.85 million, up from $25.74 million in 2024. Total interest income rose to $80.77 million for the quarter, a 5.7% increase from $76.41 million in Q3 2024, driven by a 5.9% increase in interest and fees on loans to $78.93 million. Net interest income after provision for credit losses increased by 13.9% to $37.13 million for the quarter. The company's total assets grew to $2.90 billion as of September 30, 2025, from $2.87 billion at December 31, 2024. Loans held for sale decreased significantly to $72.92 million from $128.23 million, while net loans receivable increased to $2.38 billion from $2.27 billion. A notable strategic change was the non-controlling interest redemption at Medallion Bank totaling $46.00 million during the nine-month period.

Why It Matters

For investors, the mixed Q3 results, with a quarterly net income dip but strong year-to-date growth, signal a complex performance picture. The significant increase in net loans receivable to $2.38 billion suggests continued expansion in their consumer and commercial lending, which is positive for revenue generation. However, the $46.00 million non-controlling interest redemption at Medallion Bank could impact future capital structure and profitability. In a competitive lending market, Medallion Financial's ability to grow its loan portfolio while managing credit losses (provision for credit losses increased to $62.13 million YTD) will be crucial for sustained investor confidence and market positioning.

Risk Assessment

Risk Level: medium — The provision for credit losses increased to $62.13 million for the nine months ended September 30, 2025, up from $55.93 million in the prior year, indicating rising credit risk. Additionally, the company's reliance on interest income, which constitutes the vast majority of its total income, exposes it to interest rate fluctuations and credit cycle risks.

Analyst Insight

Investors should monitor MBNKO's loan portfolio quality and net interest margin closely in upcoming quarters. The strong year-to-date performance suggests operational efficiency, but the Q3 net income decline warrants attention to ensure it's not a trend. Consider this a potential entry point if the market overreacts to the quarterly dip, given the robust YTD growth.

Financial Highlights

revenue

$80.77M

total Assets

$2.90B

net Income

$7.76M

revenue Growth

+5.7%

Revenue Breakdown

Key Numbers

• $7.76M — Net Income Attributable to Stockholders (Q3 2025) (Decreased from $8.61M in Q3 2024)
• $30.85M — Net Income Attributable to Stockholders (YTD Q3 2025) (Increased from $25.74M in YTD Q3 2024)
• $80.77M — Total Interest Income (Q3 2025) (Increased from $76.41M in Q3 2024)
• $2.90B — Total Assets (September 30, 2025) (Increased from $2.87B at December 31, 2024)
• $2.38B — Net Loans Receivable (September 30, 2025) (Increased from $2.27B at December 31, 2024)
• $62.13M — Provision for Credit Losses (YTD Q3 2025) (Increased from $55.93M in YTD Q3 2024)
• $46.00M — Non-controlling interest redemption at Medallion Bank (YTD Q3 2025) (Strategic capital management activity)
• 23,279,435 — Common shares outstanding (November 3, 2025) (Current outstanding shares)
• $17.07 — Book value per common share (September 30, 2025) (Increased from $16.00 at December 31, 2024)
• $2.06B — Deposits (September 30, 2025) (Decreased from $2.09B at December 31, 2024)

Key Players & Entities

• MEDALLION FINANCIAL CORP. (company) — Registrant
• Medallion Bank (company) — Wholly-owned subsidiary, FDIC-insured industrial bank
• Medallion Capital, Inc. (company) — Wholly-owned subsidiary, SBIC
• Medallion Funding LLC (company) — Wholly-owned subsidiary, SBIC
• Freshstart Venture Capital Corp. (company) — Wholly-owned subsidiary, former SBIC
• $7.76 million (dollar_amount) — Net income attributable to Medallion Financial Corp. Stockholders for Q3 2025
• $8.61 million (dollar_amount) — Net income attributable to Medallion Financial Corp. Stockholders for Q3 2024
• $30.85 million (dollar_amount) — Net income attributable to Medallion Financial Corp. Stockholders for YTD Q3 2025
• $25.74 million (dollar_amount) — Net income attributable to Medallion Financial Corp. Stockholders for YTD Q3 2024
• $46.00 million (dollar_amount) — Non-controlling interest redemption at Medallion Bank for YTD Q3 2025

FAQ

Risk Factors

• Bank Holding Company Status and Regulatory Oversight [high — regulatory]: Medallion Financial Corp. reports as a bank holding company but is not one for regulatory purposes. Its primary operating subsidiary, Medallion Bank, is an FDIC-insured industrial bank subject to federal and state agency regulations and examinations. This subjects the company to a complex regulatory environment that can impact operations and profitability.
• Competition in Financial Services [medium — market]: Medallion Bank faces competition from other financial institutions. The company's business model, including originating consumer loans for RVs, boats, collector cars, and home improvements, and its reliance on brokered deposits, places it in a competitive landscape where market share and pricing are critical.
• Reliance on Brokered Deposits [medium — financial]: The company finances its loan portfolio primarily with time certificates of deposit originated nationally through a variety of brokered deposit relationships. Changes in the availability or cost of these deposits could significantly impact the company's funding costs and liquidity.
• SBIC Regulation and SBA Financing [low — operational]: Subsidiaries Medallion Capital and Medallion Funding LLC operate as SBICs and are regulated by the Small Business Administration (SBA). Medallion Capital is also financed in part by the SBA. This dual regulatory oversight and reliance on SBA financing introduces specific operational and compliance risks.
• Credit Risk in Loan Portfolio [medium — financial]: The company originates consumer loans for recreational vehicles, boats, collector cars, and home improvements. The provision for credit losses increased to $62.13 million year-to-date Q3 2025 from $55.93 million in the prior year, indicating potential increases in credit risk or a more conservative provisioning strategy.

Industry Context

Medallion Financial Corp. operates in the specialty finance sector, with its primary subsidiary, Medallion Bank, functioning as an FDIC-insured industrial bank. The company focuses on originating consumer loans for recreational vehicles, boats, collector cars, and home improvements, funded largely by brokered deposits. This places it in direct competition with a wide array of traditional banks, credit unions, and other non-bank lenders, all vying for market share in consumer lending and deposit gathering.

Regulatory Implications

As a bank holding company with an FDIC-insured industrial bank subsidiary, Medallion Financial Corp. is subject to significant regulatory oversight from federal and state agencies. Compliance with banking regulations, capital requirements, and examination processes are critical. Furthermore, its SBIC subsidiaries are regulated by the SBA, adding another layer of compliance and operational considerations.

What Investors Should Do

1. Monitor loan portfolio quality and provision for credit losses.
2. Analyze the impact of interest rate changes on net interest margin.
3. Evaluate the strategy behind the non-controlling interest redemption.
4. Assess the growth drivers for net loans receivable.

Key Dates

• 2025-09-30: End of Q3 2025 — Reported net income of $7.76 million for the quarter and total assets of $2.90 billion. Net loans receivable stood at $2.38 billion.
• 2024-09-30: End of Q3 2024 — Reported net income of $8.61 million for the quarter, indicating a year-over-year decrease in quarterly net income.
• 2025-01-01: Start of Fiscal Year 2025 — Year-to-date results for the nine months ended September 30, 2025, show net income growth of 19.8% to $30.85 million.
• 2024-12-31: End of Fiscal Year 2024 — Total assets were $2.87 billion and net loans receivable were $2.27 billion, providing a baseline for asset growth.
• 2025-11-03: Common shares outstanding reported — 23,279,435 common shares outstanding provide context for per-share metrics, though EPS is not explicitly stated for the period.

Glossary

FDIC

Federal Deposit Insurance Corporation, an independent agency of the U.S. federal government that insures deposits in banks and savings associations. (Medallion Bank is an FDIC-insured industrial bank, meaning deposits are protected up to a certain limit, which is crucial for attracting depositors.)

SBIC

Small Business Investment Company, a privately owned and managed investment company licensed and regulated by the Small Business Administration (SBA). (Medallion Capital and Medallion Funding LLC are SBICs, indicating they receive regulatory oversight and potential financing from the SBA for their lending activities.)

Brokered deposit relationships

Deposits placed by a third party (a broker) on behalf of an investor. Banks use these to attract funds from a wider range of depositors. (Medallion Financial Corp. relies on these relationships to fund its loan portfolio, making them a key component of its funding strategy.)

Non-controlling interest

The portion of equity interest in a subsidiary that is not attributable to the parent company. It represents the ownership stake of outside shareholders. (The $46.00 million redemption of non-controlling interest at Medallion Bank signifies a strategic move to consolidate ownership or simplify the capital structure.)

Net loans receivable

The total amount of loans a financial institution has made, minus any allowance for loan losses. (This is a core asset for Medallion Financial Corp., showing growth to $2.38 billion, indicating expansion in its lending business.)

Book value per common share

A company's total assets minus its total liabilities and intangible assets, divided by the number of outstanding common shares. (The increase to $17.07 from $16.00 indicates growth in the company's net worth on a per-share basis.)

Year-Over-Year Comparison

Compared to the prior year, Medallion Financial Corp. experienced a decrease in net income for the third quarter of 2025 ($7.76M vs. $8.61M), although year-to-date net income showed robust growth of 19.8% ($30.85M vs. $25.74M). Total interest income saw a modest increase of 5.7% to $80.77M, supported by a 5.9% rise in interest and fees on loans. While total assets grew slightly to $2.90B, deposits decreased to $2.06B, and loans held for sale significantly declined, offset by an increase in net loans receivable. The provision for credit losses also rose year-to-date, indicating a potential increase in risk or a more conservative provisioning approach.

Key Financial Figures

• $0.01 — ch registered Common Stock, par value $0.01 per share MFIN NASDAQ Global Select
• $0 — of registrant's Common Stock, par value $0.01, as of November 3, 2025, was 23,279,
• $2.90 billion — nding businesses. Our total assets were $2.90 billion and $2.87 billion as of September 30, 2
• $2.87 billion — Our total assets were $2.90 billion and $2.87 billion as of September 30, 2025 and December 3

Filing Documents

• mfin-20250930.htm (10-Q) — 10115KB
• mfin-ex31_1.htm (EX-31.1) — 16KB
• mfin-ex31_2.htm (EX-31.2) — 16KB
• mfin-ex32_1.htm (EX-32.1) — 9KB
• mfin-ex32_2.htm (EX-32.2) — 8KB
• 0001193125-25-264655.txt ( ) — 34866KB
• mfin-20250930.xsd (EX-101.SCH) — 2089KB
• mfin-20250930_htm.xml (XML) — 9726KB

– FINANCIAL INFORMATION

PART I – FINANCIAL INFORMATION 3

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS 3

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 40

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 63

CONTROLS AND PROCEDURES

ITEM 4. CONTROLS AND PROCEDURES 63

—OTHER INFORMATION

PART II—OTHER INFORMATION 64

LEGAL PROCEEDINGS

ITEM 1. LEGAL PROCEEDINGS 64

RISK FACTORS

ITEM 1A. RISK FACTORS 64

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS 64

OTHER INFORMATION

ITEM 5. OTHER INFORMATION 64

EXHIBITS

ITEM 6. EXHIBITS 65

SIGNATURES

SIGNATURES 66 SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS The following discussion should be read in conjunction with our financial statements and the notes to those statements and other financial information appearing elsewhere in this report. This report contains forward-looking statements relating to future events and future performance applicable to us within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, or the Exchange Act, including, without limitation, statements regarding our expectations, beliefs, intentions, or future strategies that are signified by the words expects, anticipates, intends, believes, or similar language. In connection with certain forward-looking statements contained in this Form 10-Q and those that may be made in the future by or on behalf of the Company, the Company notes that there are various factors that could cause actual results to differ materially from those set forth in any such forward-looking statements. The forward-looking statements contained in this Form 10-Q were prepared by management and are qualified by, and subject to, significant business, economic, competitive, regulatory, and other uncertainties and contingencies, including those relating to the U.S. and global economies, including the current inflationary environment, the impact of tariffs and the risk of recession, all of which are difficult or impossible to predict, and many of which are beyond control of the Company. All forward-looking statements included in this document are based on information available to us on the date hereof, and we assume no obligation to update any forward-looking statements. The statements have not been audited by, examined by, compiled by, or subjected to agreed-upon procedures by independent accountants, and no third-party has independently verified or reviewed such statements. Readers of this Form 10-Q should consider these facts in evaluating the info

– FINANCI AL INFORMATION

PART I – FINANCI AL INFORMATION

FINANCI AL STATEMENTS

ITEM 1. FINANCI AL STATEMENTS BASIS OF PREPARATION We, Medallion Financial Corp., or the Company, are a specialty finance company organized as a Delaware corporation. Our strategic focus is growing our consumer finance and commercial lending businesses. Our total assets were $2.90 billion and $2.87 billion as of September 30, 2025 and December 31, 2024. We conduct our business through various wholly-owned subsidiaries including: Medallion Bank, or the Bank, a Federal Deposit Insurance Corporation, or FDIC, insured industrial bank that originates consumer loans, raises deposits and conducts other banking activities; Medallion Capital, Inc., or Medallion Capital, a Small Business Investment Company, or SBIC, which operates a mezzanine financing business; Medallion Funding LLC, or Medallion Funding, an SBIC, historically our primary taxi medallion lending company; and Freshstart Venture Capital Corp., or Freshstart, which historically originated and serviced taxi medallion and commercial loans and was an SBIC through 2023. Our consolidated balance sheets as of September 30, 2025, and the related consolidated statements of operations, consolidated statements of other comprehensive income, consolidated statements of stockholders' equity and cash flows for the three and nine months then ended included in Item 1 have been prepared by us, without audit, pursuant to the rules and regulations of the SEC. Certain information and note disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the U.S. have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, the accompanying consolidated financial statements include all adjustments, which are of a normal and recurring nature, necessary to present fairly our consolidated financial position and results of operations. The results of operations for the three and nine months ended September 30, 2025 may not b

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) September 30, 2025 (1) ORGANIZATION OF MEDALLION FINANCIAL CORP. AND ITS SUBSIDIARIES Medallion Financial Corp., or the Company, is a specialty finance company organized as a Delaware corporation that reports as a bank holding company, but is not a bank holding company for regulatory purposes. The Company conducts its business through various wholly-owned subsidiaries including its primary operating company, Medallion Bank, or the Bank, a Federal Deposit Insurance Corporation, or FDIC, insured industrial bank that originates consumer loans, raises deposits, and conducts other banking activities. The Bank is subject to competition from other financial institutions and to the regulations of certain federal and state agencies, and undergoes examinations by those agencies. The Bank was formed in May 2002 for the purpose of obtaining an industrial bank charter pursuant to the laws of the State of Utah. The Bank originates consumer loans on a national basis for the purchase of recreational vehicles, or RVs, boats, collector cars, and other consumer recreational equipment and to finance home improvements such as swimming pools, roofs, and windows. Prior to 2015, the Bank originated commercial loans to finance the purchase of taxi medallions, all of which are serviced by the Company. The loans are financed primarily with time certificates of deposit which are originated nationally through a variety of brokered deposit relationships. The Company also conducts business through its subsidiaries Medallion Capital, Inc., or Medallion Capital, a Small Business Investment Company, or SBIC, which conducts a mezzanine financing business; Medallion Funding LLC, or MFC, an SBIC, which historically was the Company's primary taxi medallion lending company; and Freshstart Venture Capital Corp., or Freshstart, which historically originated and serviced taxi medallion and commercial loans. Medallion Capital and MFC, as SBICs, a

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