Daily News: February 13, 2014

NewStar: 2013 New Funded Volume, Loan Growth Up 26%

NewStar Financial reported consolidated net income of $6.4 million for the fourth quarter of 2013 was up from $6.2 million in the fourth quarter of 2012. The company said consolidated net income for 2013 increased to $24.6 million compared to $24.0 million in 2012. NewStar noted that net income excluded the results of the Arlington Fund, a consolidated variable interest entity.

Highlights from the news release included the following:

. Loan Growth – Loans outstanding were $2.37 billion, up 15% from the prior quarter and 26% for the full year.

. New Loan Volume – New funded loan volume was $549 million, including a portfolio purchase, in the fourth quarter and $1.3 billion for the year, up 26% from 2012.

. Credit Costs – Provision for credit losses were consistent with the prior quarter and down $2.9 million, or 23%, for the full year.

. The Leveraged Finance loan portfolio, excluding loans in the Arlington Fund, increased by $246 million during the fourth quarter of 2013 to
over $1.8 billion, while asset-based loans and leases in our Business Credit portfolio increased 4% to $237 million.

. Asset-based lending and equipment finance business lines originated approximately $12 million and $20 million, respectively, in the fourth
quarter of 2013, or 11% of new loan volume retained on the balance sheet, excluding the NCOF portfolio purchase.

“I am pleased to report that we finished the year with another quarter of solid operating results highlighted by strong loan growth and consistent earnings. Origination volume increased to $1.3 billion for the year and net loan growth was 26%. Earnings for the year increased nearly 3%,” said Tim Conway, NewStar’s chairman and chief executive officer. “We also continued to make significant progress on other key objectives through the year, including re-levering the balance sheet, launching a new managed credit fund, and significantly reducing NPAs,” he added. “On the funding side, we completed several milestone transactions, increasing balance sheet leverage to 3.2x and received a BB- rating from S&P. Our stock has also performed well as the market continues to recognize the value of asset origination platforms like NewStar,” he concluded.

To read the NewStar Financial news release: click here.