Andrew Milgram

This was a very small piece of their portfolio.

And so they can more quickly get to a place from an earnings power impact and a balance sheet impact that they would dispose of the portfolio at a sharp discount.

So we went to the federally chartered banks, we went to the largest portfolio and began a negotiation with them, moved through that pretty quickly and took that portfolio over.

That automatically made us the largest independent lender into the space.

Also, now you have multiple transactions.

The largest group of lenders into the space were the credit unions.

The credit unions, faced with the prospect of a sharp decline in the asset value on their balance sheets, found themselves essentially insolvent.

Because prior to 2015, ultimately 2018-19, when this part of the story is happening,

Taxi medallion loans were considered gold because they remain an important part of New York City's infrastructure.

When you talk to New York City, to the regulators, to transportation departments, city planners, transportation consultants, all of them point out New York City has a hard time operating without taxi medallions.

Also, it's a meaningful portion of the New York City budget.

So for all of those reasons, we felt like New York City would take a pretty active role in supporting it.

The market understood that for years and years.

So the haircut on a credit union's loan was next to nothing.

If you were a credit union in New York, you could not lend to the space.

It was so profitable.

Now, with the sharp decline in assets, the NCUA, which is the FDIC of the credit union space, essentially seized a number of those credit unions.

So it ended up that the largest lender to the space was the federal government.

That allowed us to begin a conversation with the federal government, with the NCUA, about acquiring those assets.

That took a long time for one really important reason.