Daily News: May 8, 2014

NewStar Q1 Funded Volume Up 90% on M&A Activity

NewStar Financial reported consolidated Q1/14 net income of $6.20 million compared to $6.15 million in Q1/13. Operating income before income taxes was $9.4 million compared to $10.4 million in the first quarter of 2013.

Highlights from the news release on Q1/14:

  • New funded loan volume was $275 million, up $130 million or 90% from $145 million in the first quarter of 2013
  • Senior secured ABL of $242.7 million was up from $210.8 million or 15% from Q1/13. Senior secured cash flow loans of $1.938.4 billion was up from $1.493.2 billion or 30% compared to the same 2013 quarter
  • Asset Quality – NPAs increased slightly to 3.8% of loans from 3.6% for the prior quarter as one new loan totaling $10.4 million was classified as non-accruing
  • Funding – Completed new term debt securitization totaling $348 million in April 2014

“I am pleased to report that we started the year with a solid quarter highlighted by strong loan demand and consistent earnings. Origination volume was up sharply from the same quarter last year driven largely by loan demand derived from increasing middle market M&A activity,” said Tim Conway, NewStar’s chairman and chief executive officer. “Importantly, the quality of our current new business pipelines reflects a continuation of this positive trend into the second quarter and the pricing environment in our target markets remains relatively stable despite the excessive liquidity evident in the broader loan markets. As a result, we believe that middle market lending continues to offer the best relative value among credit investment options and NewStar is among only a few independent commercial lenders positioned to capitalize on it,” he added.

To read the full release, click here.