NewStar Financial reported Q4/14 net income of $1.2 million compared to net income of $6.4 million in Q4/13. Consolidated net income for 2014 was $10.6 million, down 57% from $24.6 million a year earlier. Earnings were hurt by lower net interest income and higher provision charges.
NewStar noted that provision charges in Q4/14 and full year 2014 of $5.3 million and $27.1 million, respectively were up from $2.3 million and $9.7 million for the same year earlier periods. The company said the 2014 provision expense increase of $17.4 million from the prior year was due primarily to specific charges recognized in connection with the resolution of legacy loans in the second quarter and strong growth in the second half of the year.
The following highlights were excerpted from the NewStar news release:
Tim Conway, NewStar’s chairman and CEO commented on the company’s quarterly results: “In the fourth quarter, we marked several important milestones in the company’s history as we continued to make progress on key strategies to improve stockholder returns. We announced a transformational strategic relationship with world class partners and have already begun to see benefits. We nearly doubled origination volume and increased assets under management by 30% to $3.8 billion in the quarter. Importantly, we also continued to differentiate our credit performance with a disciplined credit strategy that significantly under-weighted exposure to energy sectors and is expected to provide appropriate balance to our growth objectives.”
To view the full NewStar Financial news release, click here.
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