Marlin Reports Q1/20 Net Loss of $11.8MM, Volume Down 24.5% Y/Y
MAY 1, 2020 - 6:55 am
Marlin Business Services reported net loss of $11.8 million, compared with net income of $5.1 million a year ago and $8.4 million share last quarter.
Total sourced origination volume of $157.4 million was down 24.5% year-over-year. Total origination yield of 12.45%, was up 2 basis points from the prior quarter and down 31 basis points year-over-year.
Net Investment in Leases and Loans totaled $970.1 million, compared with $1.0 billion a year ago; total managed assets ended the first quarter at $1.3 billion, up 6.8% from a year ago.
Total allowance for credit losses of $52.1 million, representing a $30.4 million increase from December 31, 2019, which includes an $11.9 million increase from the adoption of CECL. The allowance as a percentage of receivables was 4.66% for equipment finance and 12.20% for working capital.
Annualized net charge-offs of 3.11%, compared with 3.00% in the prior quarter and 1.83% in the first quarter last year
Jeffrey A. Hilzinger, Marlin’s president and CEO, said, “Marlin continues to carefully evaluate the public health crisis and resulting economic dislocation to its small business customers resulting from the COVID-19 outbreak. Beginning in early March, we initiated a series of measures to protect our employees from the effects of the pandemic, carefully manage our liquidity and capital position, and protect the value of our portfolio. We are continuing to lend and support our customers and partners during these challenging times. In addition, for existing customers and partners, we have implemented programs to help them weather the crisis including a payment deferral program for customers that have been directly impacted by COVID-19, and we are a participating lender in the second round of funding under the federal government’s Paycheck Protection Program administered by the SBA.”
Hilzinger continued, “As we navigate this evolving and uncertain environment, we remain focused on the tasks at hand—supporting our employees, valued customers and partners while ensuring business continuity and financial stability. This has been a particularly stressful time for our employees, and I want to thank all of my colleagues for their deep commitment to our company and our customers during this unprecedented experience. We look forward to serving our customers and communities well in a time of need and emerging from this crisis as a stronger enterprise.”
Commercial lenders will face many new and unique challenges over the coming months as the full effects of the coronavirus pandemic are felt throughout the economy. For commercial customers, cash flow, liquidity and credit tightening dramatically across industries is the... read more
Sale-leasebacks are common in the industry, but these transactions can cause accounting issues under ASC 842. Shawn Halladay outlines the key issues and accounting requirements surrounding this product as well as strategies to overcome potential obstacles. Customers enter sale-leasebacks for... read more