Regional Management Corp. Announces Fourth Quarter 2018 Results

February 12, 2019

- Net income of $10.8 million and diluted earnings per share of $0.90 -

- 15th consecutive quarter of year-over-year double-digit total finance receivables growth -

- 10th consecutive quarter of year-over-year double-digit revenue growth -

GREENVILLE, S.C.--(BUSINESS WIRE)--Feb. 12, 2019-- Regional Management Corp. (NYSE: RM), a diversified consumer finance company, today announced results for the fourth quarter and full year ended December 31, 2018.

Fourth Quarter 2018 Highlights

  • Net income for the fourth quarter of 2018 was $10.8 million, a 1.1% reduction from the prior-year period of 2017. The prior-year period included $3.5 million of tax benefits and credits, primarily related to the Tax Cuts and Jobs Act. Diluted earnings per share for the fourth quarter of 2018 was $0.90, compared to $0.92 in the prior-year period (of which $0.30 was related to the aforementioned tax benefits and credits).
  • Total finance receivables as of December 31, 2018 were $932.2 million, an increase of 14.0%, or $114.8 million, from the prior-year period.
    • 15th consecutive quarter of year-over-year double-digit finance receivables growth.
    • Total core small and large loan finance receivables increased $152.7 million, or 21.1%, compared to the prior-year period.
    • Large loan finance receivables of $438.0 million increased $90.8 million, or 26.1%, from the prior-year period and represented 47.0% of the total loan portfolio. Small loan finance receivables as of December 31, 2018 were $437.7 million, an increase of 16.5% over the prior-year period.
  • Total revenue for the fourth quarter of 2018 was $83.7 million, an $11.6 million, or 16.1%, increase from the prior-year period.
    • 10th consecutive quarter of year-over-year double-digit revenue growth.
    • Interest and fee income increased 13.0%, driven by a 14.0% increase in finance receivables compared to the prior-year period.
    • Insurance income, net increased $2.5 million; approximately $1.5 million of the increase was due to a change in business practice of the company to lower its utilization of non-file insurance.
  • Provision for credit losses for the fourth quarter of 2018 was $23.7 million, an increase of 21.8% from the prior-year period. The provision for credit losses for the fourth quarter of 2018 included approximately $1.5 million related to a change in business practice of the company to lower its utilization of non-file insurance, which grossed up the provision for credit losses and insurance income. This change had no impact on net income.
  • Annualized net credit losses as a percentage of finance receivables were 9.1%, a 10 basis point increase from 9.0% in the prior-year period, primarily due to 30 basis points of additional non-file claims shifting to credit losses compared to the prior-year period.
  • 30+ day contractual delinquencies as of December 31, 2018 were 7.7%, compared to 7.5% as of December 31, 2017. 30+ day contractual delinquencies include 0.4% and 0.3% related to hurricane-affected branches as of December 31, 2018 and December 31, 2017, respectively.
  • Expanded operations into Wisconsin, the Company’s 11th U.S. state, during the quarter.

“The fourth quarter was successful on all fronts, allowing us to cap off a terrific 2018 for Regional,” said Peter R. Knitzer, President and Chief Executive Officer of Regional Management. “We continued to generate double-digit year-over-year top line growth, supported by double-digit finance receivable gains in our core loan portfolio. In addition, we maintained our stable credit performance, which is a testament to our underwriting and the added benefit of our centralized credit collections team. We also continue to drive down our overall expenses as a percentage of receivables, which positions us well to expand margins and profitability over the longer term.”

“Looking ahead, in 2019, we remain focused on executing our hybrid growth strategy of increasing receivables within our established branches, and further expanding our branch network through our de novo program,” added Mr. Knitzer. “We also plan to complete the implementation of custom scorecards in our branches, which should further improve our credit profile by the end of this year. Overall, we are confident in the fundamental strength of our current model, as well as our growth trajectory and market share opportunity. We remain positioned as strongly as ever to generate increasing value for our shareholders.”

Fourth Quarter 2018 Results

Finance receivables outstanding at December 31, 2018 were $932.2 million, a 14.0% increase from $817.5 million in the prior year. Finance receivables increased based on double-digit growth in both the core small and large loan portfolios.

For the fourth quarter ended December 31, 2018, the Company reported total revenue of $83.7 million, a 16.1% increase from $72.1 million in the prior-year period. Interest and fee income for the fourth quarter of 2018 was $75.0 million, a 13.0% increase from $66.4 million in the prior-year period, related to consistent gains in the small and large loan portfolios.

The provision for credit losses in the fourth quarter of 2018 was $23.7 million, a 21.8% increase compared to $19.5 million in the prior-year period, primarily due to portfolio growth. Net credit losses were $20.7 million in the fourth quarter of 2018, an increase of $2.7 million over the prior-year period, with $1.5 million of losses attributable to the change in business practice to lower utilization of non-file insurance. Annualized net credit losses as a percentage of average finance receivables in the fourth quarter of 2018 were 9.1% (including 70 basis points related to non-file impact), a 10 basis point increase from 9.0% in the prior-year period (which included 40 basis points related to non-file impact).

General and administrative expenses for the fourth quarter of 2018 were $36.6 million, an increase of $2.6 million, or 7.6%, from the prior-year period. Annualized general and administrative expenses as a percentage of average finance receivables improved 100 basis points from the prior-year period from 17.1% to 16.1% for the fourth quarter of 2018. General and administrative expenses for the fourth quarter of 2018 included higher personnel costs related to staffing increases in information technology, centralized collections, de novo branch openings, and existing branches to support ongoing loan portfolio growth.

Interest expense was $9.6 million in the fourth quarter of 2018, compared to $6.8 million in the prior-year period. The increase in interest expense was due to higher cost of funding and larger long-term debt amounts outstanding from growth in finance receivables. Cost of funding has increased due to federal funds rate increases, larger unused lines of credit, and incremental debt issuance costs associated with upsizing the senior revolving credit facility, entering into the warehouse credit facility, and the Company’s recent completion of its second asset-backed securitization. Diversified sources of funding continue to position the Company for long-term growth.

Net income for the fourth quarter of 2018 was $10.8 million, a decrease from $10.9 million in the prior-year period. Diluted earnings per share for the fourth quarter of 2018 was $0.90, a decrease from $0.92 in the prior-year period. Net income and diluted earnings per share for the fourth quarter of 2017 included $3.5 million, or $0.30 per diluted share, of tax benefits and credits, primarily related to the Tax Cuts and Jobs Act.

2019 De Novo Outlook

As of December 31, 2018, the Company’s branch network consisted of 359 locations, including 13 net branches opened during the fourth quarter of 2018. For the full year 2019, the Company expects to open between 15 and 30 de novo branches.

Liquidity and Capital Resources

As of December 31, 2018, the Company had finance receivables of $932.2 million and outstanding long-term debt of $660.5 million, consisting of:

  • $328.1 million of long-term debt on its $638.0 million senior revolving credit facility,
  • $21.6 million of long-term debt on its amortizing loan,
  • $30.1 million of long-term debt on its $125.0 million revolving warehouse credit facility, and
  • $280.7 million of long-term debt through its asset-backed securitizations.

The Company had a GAAP debt-to-equity ratio of 2.4 to 1.0 and a shareholder equity ratio of 29.2% as of December 31, 2018.

Conference Call Information

Regional Management Corp. will host a conference call and webcast today at 5:00 PM ET to discuss these results.

The dial-in number for the conference call is (800) 319-4610 (toll-free) or (631) 891-4304 (direct). Please dial the number 10 minutes prior to the scheduled start time.

*** A supplemental slide presentation will be made available on Regional Management’s website prior to the earnings call at www.RegionalManagement.com. ***

In addition, a live webcast of the conference call will also be available on Regional Management’s website at www.RegionalManagement.com.

A replay will be available following the end of the call through Tuesday, February 19, 2019, by telephone at (844) 512-2921 (toll-free) or (412) 317-6671 (international), passcode 10006059. A webcast replay of the call will be available at http://www.RegionalManagement.com for one year following the call.

Forward-Looking Statements

This press release may contain various “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, which represent Regional Management Corp.’s expectations or beliefs concerning future events. Words such as “may,” “will,” “should,” “likely,” “anticipates,” “expects,” “intends,” “plans,” “projects,” “believes,” “estimates,” “outlook,” and similar expressions may be used to identify these forward-looking statements. Such forward-looking statements are about matters that are inherently subject to risks and uncertainties, many of which are outside of the control of Regional Management. Factors that could cause actual results or performance to differ from the expectations expressed or implied in such forward-looking statements include, but are not limited to, the following: changes in general economic conditions, including levels of unemployment and bankruptcies; risks associated with Regional Management’s transition to a new loan origination and servicing software system; risks related to opening new branches, including the ability or inability to open new branches as planned; risks inherent in making loans, including repayment risks and value of collateral, which risks may increase in light of adverse or recessionary economic conditions; risks relating to Regional Management’s asset-backed securitization transactions; changes in interest rates; the risk that Regional Management’s existing sources of liquidity become insufficient to satisfy its needs or that its access to these sources becomes unexpectedly restricted; changes in federal, state, or local laws, regulations, or regulatory policies and practices, and risks associated with the manner in which laws and regulations are interpreted, implemented, and enforced; the impact of changes in tax laws, guidance, and interpretations, including related to certain provisions of the Tax Cuts and Jobs Act; the timing and amount of revenues that may be recognized by Regional Management; changes in current revenue and expense trends (including trends affecting delinquencies and credit losses); changes in Regional Management’s markets and general changes in the economy (particularly in the markets served by Regional Management); changes in the competitive environment in which Regional Management operates or in the demand for its products; the impact of a prolonged shutdown of the federal government; risks related to acquisitions; changes in operating and administrative expenses; and the departure, transition, or replacement of key personnel. Such factors and others are discussed in greater detail in Regional Management’s filings with the Securities and Exchange Commission. Regional Management will not update the information contained in this press release beyond the publication date, except to the extent required by law, and is not responsible for changes made to this document by wire services or Internet services.

About Regional Management Corp.

Regional Management Corp. (NYSE: RM) is a diversified consumer finance company providing a broad array of loan products primarily to customers with limited access to consumer credit from banks, thrifts, credit card companies, and other traditional lenders. Regional Management began operations in 1987 with four branches in South Carolina and has since expanded its branch network across South Carolina, Texas, North Carolina, Tennessee, Alabama, Oklahoma, New Mexico, Georgia, Virginia, Missouri and Wisconsin. Each of its loan products is structured on a fixed rate, fixed term basis with fully amortizing equal monthly installment payments and is repayable at any time without penalty. Regional Management’s loans are sourced through its multiple channel platform, including in its branches, through direct mail campaigns, online credit application networks, retailers, and its consumer website. For more information, please visit www.RegionalManagement.com.

 

Regional Management Corp. and Subsidiaries

Consolidated Statements of Income

(Unaudited)

(in thousands, except per share amounts)

           
Better (Worse) Better (Worse)
4Q 18 4Q 17   $     % YTD 18 YTD 17   $     %
Revenue
Interest and fee income $ 75,013 $ 66,377 $ 8,636 13.0 % $ 280,121 $ 249,034 $ 31,087 12.5 %
Insurance income, net 5,624 3,076 2,548 82.8 % 14,793 13,061 1,732 13.3 %
Other income   3,112     2,654     458   17.3 %   11,792     10,364     1,428   13.8 %
Total revenue   83,749     72,107     11,642   16.1 %   306,706     272,459     34,247   12.6 %
 
Expenses
Provision for credit losses 23,698 19,464 (4,234 ) (21.8

)%

87,056 77,339 (9,717 ) (12.6

)%

 
Personnel 22,074 19,903 (2,171 ) (10.9

)%

84,068 75,992 (8,076 ) (10.6

)%

Occupancy 5,933 5,346 (587 ) (11.0

)%

22,519 21,530 (989 ) (4.6

)%

Marketing 1,902 1,841 (61 ) (3.3

)%

7,745 7,128 (617 ) (8.7

)%

Other   6,707     6,929     222   3.2 %   25,952     26,305     353   1.3 %
Total general and administrative 36,616 34,019 (2,597 ) (7.6

)%

140,284 130,955 (9,329 ) (7.1

)%

 
Interest expense   9,643     6,816     (2,827 ) (41.5

)%

  33,464     23,908     (9,556 ) (40.0

)%

Income before income taxes 13,792 11,808 1,984 16.8 % 45,902 40,257 5,645 14.0 %
Income taxes   3,022     923     (2,099 ) (227.4 )%   10,557     10,294     (263 ) (2.6 )%
Net income $ 10,770   $ 10,885   $ (115 ) (1.1 )% $ 35,345   $ 29,963   $ 5,382   18.0 %
Net income per common share:
Basic $ 0.92   $ 0.94   $ (0.02 ) (2.1 )% $ 3.03   $ 2.59   $ 0.44   17.0 %
Diluted $ 0.90   $ 0.92   $ (0.02 ) (2.2 )% $ 2.93   $ 2.54   $ 0.39   15.4 %
Weighted-average shares outstanding:
Basic   11,672     11,592     (80 ) (0.7

)%

  11,655     11,551     (104 ) (0.9 )%
Diluted   12,010     11,875     (135 )

(1.1

)%

  12,078     11,783     (295 ) (2.5

)%

 
Return on average assets (annualized)   4.6 %   5.4 %   4.0 %   4.0 %
Return on average equity (annualized)   15.7 %   18.7 %   13.6 %   13.5 %
 
 

Regional Management Corp. and Subsidiaries

Consolidated Balance Sheets

(Unaudited)

(in thousands, except par value amounts)

     
Increase (Decrease)
4Q 18 4Q 17   $     %
Assets
Cash $ 3,657 $ 5,230 $ (1,573 ) (30.1 )%
Gross finance receivables 1,237,526 1,066,650 170,876 16.0 %
Unearned finance charges and insurance premiums   (305,283 )   (249,187 )   (56,096 ) (22.5

)%

Finance receivables 932,243 817,463 114,780 14.0 %
Allowance for credit losses   (58,300 )   (48,910 )   (9,390 ) (19.2

)%

Net finance receivables 873,943 768,553 105,390 13.7 %
Restricted cash 46,484 16,787 29,697 176.9 %
Property and equipment 13,926 12,294 1,632 13.3 %
Intangible assets 10,010 10,607 (597 ) (5.6 )%
Other assets   8,375     16,012     (7,637 ) (47.7 )%
Total assets $ 956,395   $ 829,483   $ 126,912   15.3 %
 
Liabilities and Stockholders’ Equity
Liabilities:
Long-term debt $ 660,507 $ 571,496 $ 89,011 15.6 %
Unamortized debt issuance costs   (9,158 )   (4,950 )   (4,208 ) (85.0

)%

Net long-term debt 651,349 566,546 84,803 15.0 %
Accounts payable and accrued expenses 25,138 18,565 6,573 35.4 %
Deferred tax liability   747     4,961     (4,214 ) (84.9 )%
Total liabilities 677,234 590,072 87,162 14.8 %
Stockholders’ equity:
Preferred stock ($0.10 par value, 100,000 shares authorized, no shares issued or outstanding)
Common stock ($0.10 par value, 1,000,000 shares authorized, 13,323 shares issued and 11,777 shares outstanding at December 31, 2018 and 13,205 shares issued and 11,659 shares outstanding at December 31, 2017) 1,332 1,321 11 0.8 %
Additional paid-in-capital 98,778 94,384 4,394 4.7 %
Retained earnings 204,097 168,752 35,345 20.9 %
Treasury stock (1,546 shares at December 31, 2018 and 2017)   (25,046 )   (25,046 )     0.0 %
Total stockholders’ equity   279,161     239,411     39,750   16.6 %
Total liabilities and stockholders’ equity $ 956,395   $ 829,483   $ 126,912   15.3 %
 
   

Regional Management Corp. and Subsidiaries

Selected Financial Data

(Unaudited)

(in thousands, except per share amounts)

 
Finance Receivables by Product
4Q 18   3Q 18   QoQ $

Inc (Dec)

  QoQ %

Inc (Dec)

  4Q 17   YoY $

Inc (Dec)

  YoY %

Inc (Dec)

Small loans $ 437,662 $ 414,441 $ 23,221

5.6

%

$ 375,772 $ 61,890

16.5

%

Large loans   437,998   410,811   27,187  

6.6

%

  347,218   90,780  

26.1

%

Total core loans 875,660 825,252 50,408

6.1

%

722,990 152,670

21.1

%

Automobile loans 26,154 32,322

(6,168

)

(19.1

)%

61,423

(35,269

)

(57.4

)%

Retail loans   30,429   30,502  

(73

)

(0.2

)%

  33,050  

(2,621

)

(7.9

)%

Total finance receivables $ 932,243 $ 888,076 $ 44,167  

5.0

%

$ 817,463 $ 114,780  

14.0

%

 
Number of branches at period end 359 346 13

3.8

%

342 17

5.

%

Average finance receivables per branch $ 2,597 $ 2,567 $ 30  

1.2

%

$ 2,390 $ 207  

8.7

%

 
    Averages and Yields
4Q 18   3Q 18   4Q 17
Average Finance
Receivables
 

Average Yield
(Annualized)

Average Finance
Receivables
 

Average Yield
(Annualized)

Average Finance
Receivables
 

Average Yield
(Annualized)

Small loans $ 426,901 39.5 % $ 401,132 40.4 % $ 369,241 41.5 %
Large loans 425,948 28.4 % 401,212 28.6 % 328,759 29.1 %
Automobile loans 29,114 15.0 % 35,845 15.6 % 66,664 15.6 %
Retail loans   30,555 19.1 %   30,861 19.3 %   32,243 19.9 %
Total interest and fee yield $ 912,518 32.9 % $ 869,050 33.2 % $ 796,907 33.3 %
Total revenue yield $ 912,518 36.7 % $ 869,050 35.9 % $ 796,907 36.2 %
 
      Components of Increase in Interest and Fee Income

4Q 18 Compared to 4Q 17

Increase (Decrease)

Volume   Rate   Volume & Rate   Net
Small loans $ 5,978 $ (1,784 ) $ (278 ) $ 3,916
Large loans 7,061 (530 ) (157 ) 6,374
Automobile loans (1,466 ) (100 ) 56 (1,510 )
Retail loans (84 ) (63 ) 3 (144 )
Product mix   (1,859 )   1,609     250      
Total increase in interest and fee income $ 9,630   $ (868 ) $ (126 ) $ 8,636  
 
   

 

  Net Loans Originated (1)
4Q 18   3Q 18   QoQ $

Inc (Dec)

  QoQ %

Inc (Dec)

  4Q 17   YoY $

Inc (Dec)

  YoY %

Inc (Dec)

Small loans $ 172,820 $ 162,644 $ 10,176 6.3 % $ 149,299 $ 23,521 15.8 %
Large loans 115,805 95,410 20,395 21.4 % 106,680 9,125 8.6 %
Automobile loans (2) 0.0 % 1,927 (1,927 ) (100.0 ) %
Retail loans   6,593   5,971   622 10.4 %   8,363   (1,770 ) (21.2 ) %
Total net loans originated $ 295,218 $ 264,025 $ 31,193 11.8 % $ 266,269 $ 28,949   10.9 %
 
    (1)   Represents the balance of loan origination and refinancing net of unearned finance charges.
(2) The Company ceased originating automobile loans in November 2017.
 
           

 

Other Key Metrics
4Q 18   3Q 18   4Q 17
Net credit losses $ 20,698 $ 16,790 $ 17,954
Percentage of average finance receivables (annualized) 9.1 % 7.7 % 9.0 %
 
Provision for credit losses (1) $ 23,698 $ 23,640 $ 19,464
Percentage of average finance receivables (annualized) 10.4 % 10.9 % 9.8 %
Percentage of total revenue 28.3 % 30.3 % 27.0 %
 
General and administrative expenses $ 36,616 $ 35,861 $ 34,019
Percentage of average finance receivables (annualized) 16.1 % 16.5 % 17.1 %
Percentage of total revenue 43.7 % 46.0 % 47.2 %
 
Same store results:
Finance receivables at period-end $ 925,621 $ 886,104 $ 806,921
Finance receivable growth rate 13.7 % 14.4 % 12.7 %
Number of branches in calculation 337 338 331
 
        (1)   Includes hurricane-related provision for credit losses of $(174), $3,900, and $(123) for 4Q 18, 3Q 18, and 4Q 17, respectively.
 
   
Contractual Delinquency by Aging
4Q 18   3Q 18   4Q 17
Allowance for credit losses (1) $ 58,300   6.3 % $ 55,300   6.2 % $ 48,910   6.0 %
 
Current 754,162 80.9 % 726,003 81.8 % 669,451 81.9 %
1 to 29 days past due   105,920 11.4 %   99,008 11.1 %   86,533 10.6 %
 
Delinquent accounts:
30 to 59 days 22,529 2.3 % 22,215 2.5 % 18,728 2.2 %
60 to 89 days 17,382 1.9 % 15,360 1.7 % 15,297 1.9 %
90 to 119 days 12,279 1.3 % 10,183 1.1 % 11,339 1.4 %
120 to 149 days 10,890 1.2 % 8,476 1.0 % 8,865 1.1 %
150 to 179 days   9,081 1.0 %   6,831 0.8 %   7,250 0.9 %
 
Total contractual delinquency (2) $ 72,161 7.7 % $ 63,065 7.1 % $ 61,479 7.5 %
Total finance receivables $ 932,243 100.0 % $ 888,076 100.0 % $ 817,463 100.0 %
 
1 day and over past due $ 178,081 19.1 % $ 162,073 18.2 % $ 148,012 18.1 %
 
    Contractual Delinquency by Product

4Q 18

 

3Q 18

 

4Q 17

Small loans $ 40,663  

   9.3

% $ 34,581  

   8.3

% $ 35,246  

   9.4

%
Large loans 26,814 6.1 % 23,406 5.7 % 18,540 5.3 %
Automobile loans 2,083 8.0 % 2,686 8.3 % 4,896 8.0 %
Retail loans   2,601 8.5 %   2,392 7.8 %   2,797 8.5 %
Total contractual delinquency (2) $ 72,161 7.7 % $ 63,065 7.1 % $ 61,479 7.5 %
 
(1)   Includes incremental hurricane allowance for credit losses of $3,600, $3,900, and $2,760 in 4Q 18, 3Q 18, and 4Q 17, respectively.
(2) Includes 0.4% and 0.3% delinquency related to hurricane-affected branches for 4Q 18 and 4Q 17, respectively.
Q3 18 delinquency benefited 0.2% related to hurricane payment deferrals.
 
 
Quarterly Trend
4Q 17   1Q 18   2Q 18   3Q 18   4Q 18   QoQ $

B(W)

  YoY $

B(W)

Revenue
Interest and fee income $ 66,377 $ 66,151 $ 66,829 $ 72,128 $ 75,013 $ 2,885 $ 8,636
Insurance income, net 3,076 3,389 2,882 2,898 5,624 2,726 2,548
Other income   2,654   3,085   2,705   2,890   3,112   222     458  
Total revenue   72,107   72,625   72,416   77,916   83,749   5,833     11,642  
 
Expenses
Provision for credit losses 19,464 19,515 20,203 23,640 23,698 (58 ) (4,234 )
 
Personnel 19,903 21,228 19,390 21,376 22,074 (698 ) (2,171 )
Occupancy 5,346 5,618 5,478 5,490 5,933 (443 ) (587 )
Marketing 1,841 1,453 2,258 2,132 1,902 230 (61 )
Other   6,929   6,293   6,089   6,863   6,707   156     222  
Total general and administrative 34,019 34,592 33,215 35,861 36,616 (755 ) (2,597 )
 
Interest expense   6,816   7,177   7,915   8,729   9,643   (914 )   (2,827 )
Income before income taxes 11,808 11,341 11,083 9,686 13,792 4,106 1,984
Income taxes   923   2,697   2,601   2,237   3,022   (785 )   (2,099 )
Net income $ 10,885 $ 8,644 $ 8,482 $ 7,449 $ 10,770 $ 3,321   $ (115 )
Net income per common share:
Basic $ 0.94 $ 0.74 $ 0.73 $ 0.64 $ 0.92 $ 0.28   $ (0.02 )
Diluted $ 0.92 $ 0.72 $ 0.70 $ 0.61 $ 0.90 $ 0.29   $ (0.02 )
Weighted-average shares outstanding:
Basic   11,592   11,618   11,658   11,672   11,672       (80 )
Diluted   11,875   12,030   12,138   12,133   12,010   123     (135 )
 
Net interest margin $ 65,291 $ 65,448 $ 64,501 $ 69,187 $ 74,106 $ 4,919   $ 8,815  
Net credit margin $ 45,827 $ 45,933 $ 44,298 $ 45,547 $ 50,408 $ 4,861   $ 4,581  
 
 
4Q 17 1Q 18 2Q 18 3Q 18 4Q 18 QoQ $

Inc (Dec)

YoY $

Inc (Dec)

Total assets $ 829,483 $ 814,809 $ 868,220 $ 893,279 $ 956,395 $ 63,115   $ 126,912  
Finance receivables $ 817,463 $ 804,956 $ 847,238 $ 888,076 $ 932,243 $ 44,167   $ 114,780  
Allowance for credit losses $ 48,910 $ 47,750 $ 48,450 $ 55,300 $ 58,300 $ 3,000   $ 9,390  
Long-term debt $ 571,496 $ 550,377 $ 595,765 $ 611,593 $ 660,507 $ 48,914   $ 89,011  
 
 
Finance Receivables by Product
4Q 18   3Q 18   QoQ $

Inc (Dec)

  QoQ %

Inc (Dec)

  4Q 17   YoY $

Inc (Dec)

  YoY %

Inc (Dec)

Small loans $ 437,662 $ 414,441 $ 23,221 5.6 % $ 375,772 $ 61,890 16.5 %
Large loans   437,998   410,811   27,187   6.6 %   347,218   90,780   26.1 %
Total core loans 875,660 825,252 50,408 6.1 % 722,990 152,670 21.1 %
Automobile loans 26,154 32,322 (6,168 ) (19.1

)%

61,423 (35,269 ) (57.4

)%

Retail loans   30,429   30,502   (73 ) (0.2

)%

  33,050   (2,621 ) (7.9

)%

Total finance receivables $ 932,243 $ 888,076 $ 44,167   5.0 % $ 817,463 $ 114,780   14.0 %
 
Number of branches at period end 359 346 13 3.8 % 342 17 5.0 %
Average finance receivables per branch $ 2,597 $ 2,567 $ 30   1.2 % $ 2,390 $ 207   8.7 %
 
        Averages and Yields
YTD 18   YTD 17
Average Finance
Receivables
  Average Yield Average Finance
Receivables
  Average Yield
Small loans $ 391,481 40.0 % $ 355,826 42.2 %
Large loans 389,919 28.5 % 278,397 28.8 %
Automobile loans 41,026 15.6 % 78,317 16.3 %
Retail loans   31,393 19.0 %   31,660 18.8 %
Total interest and fee yield $ 853,819 32.8 % $ 744,200 33.5 %
Total revenue yield $ 853,819 35.9 % $ 744,200 36.6 %
 
      Components of Increase in Interest and Fee Income

YTD 18 Compared to YTD 17

Increase (Decrease)

Volume   Rate   Volume & Rate   Net
Small loans $ 15,036 $ (7,680 ) $ (770 ) $ 6,586
Large loans 32,159 (930 ) (372 ) 30,857
Automobile loans (6,073 ) (542 ) 258 (6,357 )
Retail loans (50 ) 52 (1 ) 1
Product mix   (4,390 )   4,223     167      
Total increase in interest and fee income $ 36,682   $ (4,877 ) $ (718 ) $ 31,087  
 
      Net Loans Originated (1)
YTD 18   YTD 17   YTD $

Inc (Dec)

  YTD %

Inc (Dec)

Small loans $ 624,243 $ 573,858 $ 50,385 8.8 %
Large loans 409,174 355,931 53,243 15.0 %
Automobile loans (2) 20,331 (20,331 ) (100.0

)%

Retail loans   26,579   28,885   (2,306 ) (8.0

)%

Total net loans originated $ 1,059,996 $ 979,005 $ 80,991   8.3 %
 
    (1)   Represents the balance of loan origination and refinancing net of unearned finance charges.
(2) The Company ceased originating automobile loans in November 2017.
 
          Other Key Metrics
YTD 18   YTD 17
Net credit losses $ 77,666 $ 69,679
Percentage of average finance receivables 9.1 % 9.4 %
 
Provision for credit losses (1) $ 87,056 $ 77,339
Percentage of average finance receivables 10.2 % 10.4 %
Percentage of total revenue 28.4 % 28.4 %
 
General and administrative expenses $ 140,284 $ 130,955
Percentage of average finance receivables 16.4 % 17.6 %
Percentage of total revenue 45.7 % 48.1 %
 
        (1)   Includes hurricane-related provision for credit losses of $3,726 and $2,877 for YTD 18 and YTD 17, respectively.
 

Source: Regional Management Corp.

Investor Relations
Garrett Edson, (203) 682-8331