Ellington Financial (NYSE:EFC) Q4 2025 Earnings call February 26, 2026 11:00 AM ET Company ParticipantsAlaael-Deen Shilleh - Director of Investor RelationsJ.R. Herlihy - CFO and TreasurerJason Weaver - Managing Director, Equity ResearchLarry Penn - President and CEOMark Tecotzky - Co-Chief Investment OfficerTimour Daghestani - Senior Equity Research AssociateTrevor Cranston - Director, Mortgage Finance Equity ResearchConference Call ParticipantsBose George - AnalystDouglas Harter - Managing Director, Senior ...

Ellington Financial (NYSE:EFC) Q4 2025 Earnings call February 26, 2026 11:00 AM ET Speaker8Good morning, ladies and gentlemen. Thank you for standing by. Welcome to the Ellington Financial fourth quarter 2025 earnings conference call. Today's call is being recorded. At this time, all participants have been placed in listen-only mode. The floor will be open for your questions following the presentation. If you would like to ask a question during that time, simply press Star 1 on your telephone keypad. If at ...

Earnings Conference Call February 26, 202 6 Q4 2025 Q4 2025 EARNINGS Important Notice Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve numerous risks and uncertainties. Our actual results may differ from our beliefs, expectations, estimates, and projections and, consequently, you should not rely on these forward-looking statements as pre ...

COMMERCIAL HOME IMPROVEMENT RECREATION FINTECH FOURTH QUARTER 2025 EARNINGS SUPPLEMENT February 18, 2026 NASDAQ: MFIN A specialty finance company that originates and services loans in various consumer and commercial industries, along with offering loan origination services to fintech strategic partners. Important Information This presentation contains certain forward-looking statements, including statements with regard to the future performance of Medallion Financial Corp. ("MFIN" or the "Company"). Words s ...

Management prioritized the rotation of the portfolio by decisively resolving challenged watch list and REO investments to unlock capital for new originations. The company accelerated asset resolutions, concluding that the certainty of monetization and reinvestment outweighed the potential upside of holding assets longer-term. Origination momentum reached a multi-year high in Q4 2025, driven by a 13% sequential increase in the loan portfolio to $2.7 billion. Performance attribution for the quarter's ...

Financial Data and Key Metrics Changes - In Q2 2026, the company originated $42.1 million in loans held for investment, a 42% increase from $29.6 million in the previous quarter [4] - Loan principal payments and payoffs were $46.7 million, a 35% increase from $34.5 million in the prior quarter [4] - Non-performing assets were $999,000, or 8 basis points of total assets, a decrease from $1.9 million at the end of the previous quarter [5] - The net interest margin increased by 3 basis points to 3.03% compared to 3% in the previous quarter [8] - Operating expenses rose to $7.9 million from $7.6 million in the previous quarter [13] Business Line Data and Key Metrics Changes - Loans held for investment decreased by approximately $4.1 million, with declines in multifamily, commercial business, and commercial real estate loans, partially offset by increases in single-family and construction loans [5] - The weighted average rate of loans originated in Q2 2026 was 6.15%, compared to 5.22% for loans held for investment as of December 31, 2025 [10] Market Data and Key Metrics Changes - The company’s loan pipelines are moderately higher than the previous quarter, suggesting origination volume in Q3 2026 will be within the range of recent quarters [4] - Approximately $112.2 million of loans are set to reprice in Q3 2026 at an expected rate 14 basis points lower than current rates [10] Company Strategy and Development Direction - The company is focusing on disciplined balance sheet growth by expanding its loan portfolio, which is deemed suitable for the stable economic environment and ongoing normalization of the yield curve [14] - The company aims to maintain its cash dividend and recognizes stock buybacks as a responsible capital management tool, having repurchased approximately $96,000 of common stock in Q2 2026 [14][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the current credit quality, noting no loans in early stages of delinquency and a strong performance of commercial real estate loans [6] - The company believes that any government initiatives to make housing more affordable would be beneficial, especially in California where demand exceeds available inventory [24][25] Other Important Information - The allowance for credit losses to gross loans held for investment was 55 basis points, a slight decrease from 56 basis points in the previous quarter [8] - The company distributed $906,000 in cash dividends to shareholders and repurchased approximately $1.5 million worth of common stock in Q2 2026, representing a 170% distribution of the quarter's net income [15][16] Q&A Session Summary Question: What is the probability that the loan portfolio remains flat over the next four quarters? - Management indicated that it is difficult to predict loan payoffs, but they have been focusing on increasing origination volume each quarter, suggesting a potential for higher origination in Q3 2026 [20] Question: Do loans repricing in the June quarter pose a potential headwind to loan growth? - Management does not foresee significant headwinds from repricing, as the rates are not substantially higher than new loan production [21] Question: Would government plans to make housing more affordable be a net positive for the business? - Management believes that any initiatives to expand available housing would be beneficial, particularly in California where demand significantly outstrips supply [24][25]

Financial Data and Key Metrics Changes - In Q2 2026, the company originated $42.1 million in loans held for investment, a 42% increase from $29.6 million in the prior quarter [5] - Loan principal payments and payoffs increased to $46.7 million, up 35% from $34.5 million in the previous quarter [5] - The net interest margin increased by 3 basis points to 3.03% compared to 3% in the previous quarter [9] - The average cost of deposits decreased to 1.32%, down 2 basis points, while the cost of borrowing decreased by 20 basis points to 4.39% [10] Business Line Data and Key Metrics Changes - Loans held for investment decreased by approximately $4.1 million, with declines in multifamily, commercial business, and commercial real estate loans, partially offset by increases in single-family and construction loans [6] - Non-performing assets were $999,000, or 8 basis points of total assets, a decrease from $1.9 million at the end of the previous quarter [6][7] - The allowance for credit losses to gross loans held for investment was 55 basis points, slightly down from 56 basis points [8] Market Data and Key Metrics Changes - The loan pipelines are moderately higher than last quarter, suggesting origination volume in Q3 2026 will be within the range of recent quarters, between $28 million and $42 million [5] - The weighted average rate of loans originated in Q2 2026 was 6.15%, compared to 5.22% for loans held for investment as of December 31, 2025 [11] Company Strategy and Development Direction - The company focuses on disciplined balance sheet growth by expanding its loan portfolio, which is deemed suitable for the stable economic environment and ongoing normalization of the yield curve [15] - The company aims to maintain its cash dividend and recognizes stock buybacks as a responsible capital management tool, having repurchased approximately $96,000 of common stock in Q2 2026 [15][16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the current credit quality, noting no loans in early stages of delinquency and a strong performance of commercial real estate loans [7] - The company anticipates opportunities for net interest margin expansion in Q3 2026 due to expected repricing of maturing wholesale funding to lower costs [13] Other Important Information - Operating expenses increased to $7.9 million in Q2 2026 from $7.6 million in the previous quarter, including a $214,000 pre-litigation settlement expense [14] - The company distributed $906,000 in cash dividends and repurchased approximately $1.5 million worth of common stock, representing a 170% distribution of the quarter's net income [16] Q&A Session Summary Question: What is the probability that the loan portfolio is flat over the next four quarters? - Management indicated that it is difficult to predict loan payoffs, but they have been focusing on increasing origination volume each quarter, suggesting a potential for higher origination in Q3 2026 [20] Question: Do loans repricing in the June quarter pose a potential headwind to loan growth? - Management noted that while repricing could have implications, it is not expected to significantly hinder loan growth as the repricing is not substantially higher than current market conditions [21] Question: Would government plans to make housing more affordable be a net positive for the business? - Management believes that any initiatives to expand available housing would be beneficial, especially in California where demand exceeds supply [23][25]

We serve a customer base we call the middle majority. They or if you think about credit, which we are a credit centric bank, if you've got a lot of money, you don't need a lot of access to credit. You pay cash for car, you save up to send your kids to college.If you're on the other end of the spectrum, you can't really access credit. So there's this middle group that are high income, heavy users of credit so they can afford a car, they can afford to send their kids to school, but they need to use credit to ...

Financial Performance - Net income was $29.5 million, or $0.29 per share[11] - Adjusted Distributable Earnings were $54.2 million, or $0.53 per share[11] - The economic return for the quarter was 2.2% (non-annualized)[11] - Book value per common share was $13.40 after total dividends declared of $0.39 for the quarter[11] Portfolio Composition and Performance - The adjusted long credit portfolio increased by 11% to $3.56 billion[11, 19] - The long Agency portfolio decreased by 18% to $220.7 million[11, 27] - The Longbridge portfolio increased by 37% to $750.0 million[11, 30] Leverage and Capital Structure - The recourse debt-to-equity ratio was 1.8:1[11] - The total debt-to-equity ratio was 8.6:1, including all non-recourse borrowings[11] Loan Origination - Loans Acquired During Q3 2025 totaled $1806.5 million, including Non-QM Loans ($994.4mm), Residential Transition Loans ($186.9mm), Commercial Mortgage Loans ($126.6mm) and Reverse Mortgage Loans ($498.6mm)[37]

Financial Data and Key Metrics Changes - The company reported GAAP net income of $17.6 million, or $0.13 per fully converted common share, with distributable earnings of $26.7 million, or $0.22 per fully converted share [11] - Distributable earnings included $1.7 million of realized losses related to a REO sale, which adjusted the distributable earnings to $0.23 per fully converted share when excluding this loss [11] - Book value at quarter end was $14.29 per fully converted share, with a decrease attributed to dividend undercoverage and the NewPoint acquisition [11] Business Line Data and Key Metrics Changes - NewPoint contributed $9.3 million to distributable earnings in its first full quarter, with a record volume of $2.2 billion in originations [6][13] - The core portfolio size declined slightly, ending the quarter at $4.4 billion across 147 loans, with multifamily assets making up 75% of the portfolio [18] - The company originated approximately $304 million in new loan commitments during the quarter, funding $196 million primarily in multifamily [6] Market Data and Key Metrics Changes - The CRE market is seeing a reset, with borrowers and lenders adjusting asset valuations, particularly outside of the office sector [18] - The average cost of debt on the core portfolio was SOFR +231 basis points, with net leverage at 2.55 times and recourse leverage at 0.84 times [14] - The company expects to return its core portfolio to a target size of at least $5 billion over the next few quarters [7] Company Strategy and Development Direction - The company is focused on integrating NewPoint, redeploying liquidity, and leveraging expanded capabilities to grow earnings and book value [10] - The integration of NewPoint is expected to generate $0.04 to $0.06 per fully converted share annually to earnings once the migration of loan servicing is complete [16] - The company is exploring additional investment opportunities outside of whole loans, including CMBS B-pieces and CRE CLO bond investments [19] Management's Comments on Operating Environment and Future Outlook - Management views the third quarter as transitional but believes it sets the stage for stronger results ahead [9] - The company is optimistic about the contribution from NewPoint growing over time, with expectations for it to be accretive to GAAP earnings and book value per share in the first half of 2026 [17] - Management noted that while the market is competitive, they continue to find attractive opportunities for risk-adjusted returns [19] Other Important Information - The company has resumed share repurchases, buying back 540,000 shares for approximately $6 million, with $25.6 million remaining on the buyback allocation [9] - The company sold two properties from its REO portfolio during the quarter and has more slated to close in Q4 [8] Q&A Session Summary Question: What led to the higher origination volumes and expectations for Q4? - Management indicated that they cultivated the balance sheet and converted loans from floating rates into CMBS products, leading to a strong Q4 outlook [29] Question: What should be expected regarding the compensation and benefits expense line item? - Management stated that expenses will trend with volume and will be variable, making it difficult to extrapolate from Q3 alone [32] Question: Are repayments expected to remain elevated in Q4? - Management expects repayments to be in line with previous quarters, noting variability as year-end approaches [38] Question: What is the target size for the core portfolio? - The company is targeting a stabilized portfolio size of between $5 billion and $5.5 billion [40] Question: Is the record quarter for NewPoint a sustainable run rate? - Management cautioned that while it was a great quarter, it may not be repeatable every quarter and advised looking at overall annual guidance [43]