Net income was $9.3 million, down 33% from $13.9 million in the year-ago period.
Loans and finance receivables grew $38 million, or 3%, sequentially and $96 million, or 8%, from a year ago to $1.3 billion reflecting growth in all loan types and the closing of the Evolocity transaction in April 2019.
Origination volume of $618 million decreased 6% from the year-ago quarter primarily reflecting lower conversion rates on higher application volume and longer portfolio duration.
Demand for lines of credit remained strong, which now account for 23% of total loans and finance receivables at quarter-end, up from 21% at September 30, 2019 and 16% a year ago.
Gross revenue of $111.7 million was essentially flat with the prior periods as the benefit from portfolio growth in Interest and finance income was offset by a decline in other revenue.
Net Interest Margin was 29.1%, essentially flat with the prior quarter and down from 29.9% in the year-ago quarter as a lower portfolio yield was partially offset by improved funding costs.
Full-Year 2019 Highlights:
Net income of $28.0 million increased 3.7% from $27.0 million in 2018.
Gross revenue increased 12% to $444.5 million, primarily due to increased interest and finance income driven by portfolio growth.
Credit performance normalized in 2019 after a strong 2018. Provision for credit losses increased 17% to $173.4 million and the corresponding Provision Rate increased from 6.0% to 7.0%.
The Net Charge-off Rate increased to 13.6% due in part to elevated losses on loans originated in the second half of 2018.
“Our fourth quarter closed out a year of significant progress at OnDeck, highlighted by solid growth in US lending, advancement of our strategic initiatives and improved capital efficiency,” said Noah Breslow, chief executive officer. “In 2019, we grew average loans and finance receivables 15%, expanded ODX, our platform-as-a-service business, combined with a leading on-line small business lender in Canada and repurchased 14% of our outstanding shares. We enter 2020 well-positioned to further expand the core US lending business, scale our international operations to profitability, drive value in the ODX platform and advance our efforts to obtain a bank charter, while increasing earnings per share and return on shareholders’ equity.”
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