O’Brien-Staley, founded by two former Cargill Inc. executives, bought performing loans secured by more than 400 medallions from Signature Bank, according to regulatory filings and interviews. That equals roughly 3% of the 13,587 medallions that are either in use or storage, according to the New York City Taxi and Limousine Commission.

Lenders such as Signature and Capital One Financial Corp. have suffered losses on medallion loans as taxi ridership and revenue plummeted in the face of competition from ride-hailing services Uber Technologies Inc. and Lyft Inc. That has left many cab drivers swamped by debts they can’t repay.

With regulators investigating allegations of predatory lending, medallion prices have fallen as low as $110,000 from roughly $1 million at the start of the decade. Banks that haven’t budged on price may become more willing to sell their loans to private equity and hedge fund firms. […]