Signature Q2 Earnings Up 13% Despite Taxi Medallion Loan Losses
JUL 21, 2016 - 6:50 am
Signature Bank announced Q2/16 net income of $102.2 million, up 13.0% from $90.5 million for Q2/15. The increase was primarily due to an increase in net interest income of $45.3 million partially offset by an increase in the provision for loan losses of $24.3 million predominantly for Chicago taxi medallion loans.
The following highlights were excerpted from the news release:
Net interest income for Q2/15 reached $281.6 million, up $45.3 million, or 19.2%, when compared with Q2/15. This increase is primarily due to growth in average interest-earning assets.
The bank’s provision for loan losses in Q2/16 was $33.3 million up 270% from $9.0 million in Q2/15. The bank noted the increase was primarily due to additional reserves for Chicago taxi medallion loans. The bank now has an allowance for loan losses to loans ratio of 30.0% for Chicago taxi medallion loans.
Net interest margin was 3.18% in Q2/16 compared with 3.32% sequentially and 3.27% for Q2/15.
“There are many uncertainties in the current global environment – political, economic and regulatory, among others. However, the one constant is our conviction to depositor safety. In times of turmoil, volatility and market disruption, we rely on the strength and success of Signature Bank’s highly focused depositor-first model to sustain our growth. This deposit first-and-foremost strategy continues to allow us to not only weather storms, but also to seize opportunities arising from changing market conditions,” explained Joseph J. DePaolo, Signature Bank president and CEO. “We have always emphasized the importance of building our franchise by attracting core relationship deposits, and since our founding, have never ceased to focus on that philosophy. We continue to add talented banking teams that complement and contribute to our growing, depositor-centric network. Our strong growth this quarter speaks directly to the single-point-of-contact approach that is the hallmark of our business and distinguishes us in the marketplace.”
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