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A wind of change is blowing through the financial industry as more people drift toward nonbank institutions for their borrowing needs.
In 1974, banks controlled the lending industry, holding 62% of the total loans. Almost five decades later, nonbanks issued 68% of all
A report by the Bank for International Settlements (BIS) indicated that syndicated lending to nonfinancial corporations increased substantially, from less than
Specialty Financing
These nonbanks’ ability to meet the need for alternative or specialty financing may be what’s driving their increase in lending.
Specialty finance firms make it easier for consumers and small to mid-size businesses to get loans they may find difficult to obtain from traditional banks.
They have easily won the hearts of some customers who were yearning to bypass long bureaucratic processes in favor of more straightforward procedures like completing loan applications and payments digitally with no initial fees and low-interest rates.
Thanks to this financing option, people who do not qualify for a traditional bank loan because of bad credit history are now turning to the alternative lending market for their capital needs.
In this context, companies like Oxford Square Capital Corp. (NASDAQ: OXSQ),
Meeting Demand
As borrowers continue seeking alternative financing sources,
Founded in
Mill City ordinarily provides nonbank lending and specialty finance to companies and individuals with both collateral and a short-term source of liquidity anticipated to be available by the time the loan matures. The principal specialty finance solutions the company provides are high-interest, short-term lending arrangements.
The loans the company provides typically have maturities of nine months or less and involve a pledge of collateral or, in the case of loans made to companies, personal guarantees by the borrower’s principals.
Since commencing short-term nonbank lending operations in
Financials
The company’s product offerings could be positively affecting growth, as shown in Mill City’s recent financial results for the three- and six-month periods that ended
Q2 2022 Highlights
Investment income from lending operations increased 83% to
$1.24 million in the three months endedJune 30 , up from$675,549 in the prior year.
For the six-month period, investment income from lending operations was
Pretax earnings from lending operations increased in the second quarter to
$734,250 from$425,393 in the prior year, a 73% increase.In the six-month period, pretax earnings from lending operations reached
$1.2 million compared to$438,377 in the prior year period, a 171% increase.Shareholder equity increased to
$14.4 million onJune 30, 2022 , from$13.4 million onDec. 31, 2021 .As of
June 30, 2022 , the company had$629,572 in cash, compared with$1,936,148 as ofDec. 31, 2021 .
Founded in 2007, Mill City is a short-term non-bank lending and specialty finance company. Additional information can be found at www.sec.gov.
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Contact Details
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Company Website
https://www.millcityventures3.com/
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