Marlin Business Services Corp. today reported fourth quarter 2011 net income of $2.1 million. Net income for the full-year 2011 was $6.2 million.
“We’re pleased with the solid operating and financial fundamentals in place for all aspects of the business,” says Daniel P. Dyer, Marlin’s co-founder and Chief Executive Officer. “We expect these same fundamentals will drive asset and profit growth going forward as we look to capitalize on the opportunities to serve the financing needs of small businesses across the country,” says Dyer.
Fourth quarter 2011 lease production was $68.4 million based on initial equipment cost, up 15% from $59.7 million for the third quarter of 2011 and 59% higher than the fourth quarter of 2010. On a year-over-year basis, lease equipment volume increased 71%, growing to $229.0 million compared to $134.0 million in 2010.
The average number of monthly originating sources reached 911, up 10% from 831 for the third quarter of 2011 and an increase of 26% from the fourth quarter a year ago.
Net interest and fee margin improved 27 basis points in the fourth quarter of 2011, to 13.04% from 12.77% in the third quarter of 2011, and has increased 94 basis points from the fourth quarter a year ago. Driving the margin improvement is cost of funds, which improved 49 basis points from the third quarter of 2011 and 130 basis points from the fourth quarter of 2010. The improvement resulted from the Company’s shift in funding mix from term funding to lower-cost insured deposits issued by the Company’s subsidiary, Marlin Business Bank.
Reflecting positive credit trends, the allowance for credit losses as a percentage of total finance receivables stands at 1.39% as of December 31, 2011 compared to 1.49% as of September 30, 2011. The allowance for credit losses as of December 31, 2011 represents 322% of total 60+ day delinquencies, compared to 282% as of September 30, 2011. Leases over 30 days delinquent were 1.02% of Marlin’s lease portfolio as of December 31, 2011, which is 16 basis points lower than the third quarter of 2011 and 95 basis points lower than the fourth quarter of 2010. Leases over 60 days delinquent were 0.38% of Marlin’s lease portfolio as of December 31, 2011, which is 9 basis points lower than the third quarter of 2011 and 51 basis points lower than the fourth quarter of 2010.
Fourth quarter net lease charge-offs were 1.40% of average net investment, representing an improvement of 33 basis points from the third quarter of 2011 and an improvement of 121 basis points from the fourth quarter of 2010.
The Company maintains ample liquidity to support growth through its insured depository, Marlin Business Bank. In addition, the Company also has $78.1 million in unused commitments through its revolver facilities.
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