Attached files
| file | filename |
|---|---|
| EX-99.1 - EXHIBIT 99.1 - Santander Consumer USA Holdings Inc. | exhibit991q12018.htm |
| 8-K - 8-K - Santander Consumer USA Holdings Inc. | scusa8-kq12018earningsfinal.htm |
04.24.2018
First Quarter 2018
Exhibit 99.2
2IMPORTANT INFORMATION
Forward-Looking Statements
This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any statements about our
expectations, beliefs, plans, predictions, forecasts, objectives, assumptions, or future events or performance are not historical facts and may be forward-looking.
These statements are often, but not always, made through the use of words or phrases such as anticipates, believes, can, could, may, predicts, potential, should,
will, estimates, plans, projects, continuing, ongoing, expects, intends, and similar words or phrases. Although we believe that the expectations reflected in these
forward-looking statements are reasonable, these statements are not guarantees of future performance and involve risks and uncertainties that are subject to
change based on various important factors, some of which are beyond our control. For additional discussion of these risks, refer to the section entitled Risk Factors
and elsewhere in our Annual Report on Form 10-K and our Quarterly Reports on Form 10-Q filed by us with the U.S. Securities and Exchange Commission (SEC).
Among the factors that could cause the forward-looking statements in this presentation and/or our financial performance to differ materially from that suggested
by the forward-looking statements are: (a) the inherent limitations in internal controls over financial reporting; (b) our ability to remediate any material
weaknesses in internal controls over financial reporting completely and in a timely manner; (c) continually changing federal, state, and local laws and regulations
could materially adversely affect our business; (d) adverse economic conditions in the United States and worldwide may negatively impact our results; (e) our
business could suffer if our access to funding is reduced; (f) significant risks we face implementing our growth strategy, some of which are outside our control; (g)
unexpected costs and delays in connection with exiting our personal lending business; (h) our agreement with Fiat Chrysler Automobiles US LLC may not result in
currently anticipated levels of growth, and is subject to certain conditions that could result in termination of the agreement; (i) our business could suffer if we are
unsuccessful in developing and maintaining relationships with automobile dealerships; (j) our financial condition, liquidity, and results of operations depend on the
credit performance of our loans; (k) loss of our key management or other personnel, or an inability to attract such management and personnel; (l) certain
regulations, including but not limited to oversight by the Office of the Comptroller of the Currency, the Consumer Financial Protection Bureau, the European
Central Bank, and the Federal Reserve, whose oversight and regulation may limit certain of our activities, including the timing and amount of dividends and other
limitations on our business; and (m) future changes in our relationship with Banco Santander which could adversely affect our operations. If one or more of the
factors affecting our forward-looking information and statements proves incorrect, our actual results, performance or achievements could differ materially from
those expressed in, or implied by, forward-looking information and statements. Therefore, we caution the reader not to place undue reliance on any forward-
looking information or statements. The effect of these factors is difficult to predict. Factors other than these also could adversely affect our results, and the reader
should not consider these factors to be a complete set of all potential risks or uncertainties. Any forward-looking statements only speak as of the date of this
document, and we undertake no obligation to update any forward-looking information or statements, whether written or oral, to reflect any change, except as
required by law. All forward-looking statements attributable to us are expressly qualified by these cautionary statements.
3
» Total auto originations of $6.3 billion, up 18% YoY
» Core retail auto loan originations of $2.3 billion, up 4% YoY
» Chrysler Capital1 loan originations of $1.9 billion, up 24% YoY
» Chrysler average quarterly penetration rate of 28%, up from 23% during the same quarter last year
» Net finance and other interest income of $1.0 billion, decreased 8% YoY
» Net leased vehicle income of $146 million, increased 14% YoY
» RIC net charge-off ratio of 8.3%, down 50 basis points YoY
» Troubled Debt Restructuring (“TDR”) balance of $6.0 billion, down from $6.3 billion QoQ
» Auction-plus recovery rate of 55.1%, up 400 basis points YoY
» Return on average assets of 2.4%, up from 1.5% YoY
» Asset sales of $1.5 billion executed through the Santander flow agreement
» $3.3 billion in asset-backed securities “ABS” offered and sold
» Launched pilot program with SBNA2 to facilitate the origination and servicing of primarily Chrysler loans
» Reached agreements with AutoFi and AutoGravity expanding SC's digital partnerships
» April 2018 - Completed prime auto loan portfolio conversion of $1.0 billion with a new third party
» April 2018 - $1.0 billion in ABS offered and sold via the SDART platform
Q1 2018 HIGHLIGHTS AND SUBSEQUENT EVENTS
1 Chrysler Capital is a dba of Santander Consumer USA
2Santander Bank N.A.
4
17.0
Max 18.5
Min 9.0
Mar-08 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18
ECONOMIC INDICATORS
U.S. Auto Sales1
Units in Millions
1 Bloomberg
2 University of Michigan
3 U.S. Bureau of Economic Analysis
Consumer Confidence2
Index Q1 1966=100
U.S. GDP3
%
U.S. Unemployment Rate1
%
OR
IGIN
A
TI
O
N
S
CRE
D
IT
Max 102.0
Min 55.3
Mar-08 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18
2.9
Max 3.2
Min -4.0
Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16 Dec-17
Max 10.0
Min 4.1
Mar-08 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18
5
44.9%
46.8%
51.1%
55.1%
35%
40%
45%
50%
55%
60%
65%
70%
Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18
SC Auction Only Recovery Rate SC Auction Plus Recovery Rate (Quarterly)
100
105
110
115
120
125
130
135
110
115
120
125
130
135
140
Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18
Manheim (Left Axis) JDP Used-Vehicle Price Index (Right Axis)
AUTO INDUSTRY ANALYSIS
Used Vehicle Indices1
Manheim: Seasonally Adjusted JD Power: Not Seasonally Adjusted
SC Recovery Rates2
Industry Net Loss Rates3
SE
V
ER
IT
Y
CRE
D
IT
Industry 60+ Day Delinquency Rates3
1 Manheim, Inc.; Indexed to a basis of 100 at 1995 levels; JD Power Used-Vehicle Price Index (not seasonally adjusted)
2 Auction Only - includes all auto-related recoveries including inorganic/purchased receivables from auction lanes only
2 Auction Plus – Per the financial statements includes insurance proceeds, bankruptcy/deficiency sales, and timing impacts
3 Standard & Poor’s Rating Services (ABS Auto Trust Data – two-month lag on data, as of January 31, 2018)
10.0%
Max 13.6%
Min 3.3%
Jan-08 Jan-10 Jan-12 Jan-14 Jan-16 Jan-18
Subprime
Max 5.9%
5.9%
Min 1.6%
Jan-08 Jan-10 Jan-12 Jan-14 Jan-16 Jan-18
Subprime
6DIVERSIFIED UNDERWRITING ACROSS THE CREDIT SPECTRUM
YoY auto originations increase across all channels
1 Approximate FICOs
2 Includes nominal capital lease originations
($ in Millions) Q1 2018 Q4 2017 Q1 2017 QoQ YoY
Total Core Retail Auto 2,291$ 1,469$ 2,198$ 56% 4%
Chrysler Capital Loans (<640)
1
1,083 741 833 46% 30%
Chrysler Capital Loans (≥640)1 879 804 755 9% 16%
Total Chrysler Capital Retail 1,962$ 1,545$ 1,588$ 27% 24%
Total Leases2 2,096 1,299 1,602 61% 31%
Total Auto Originations 6,349$ 4,313$ 5,388$ 47% 18%
Total Per onal Lending 273 529 288 (48%) (5%)
Total SC Originations 6,623$ 4,842$ 5,676$ 37% 17%
SBNA Originations 24 - - N/A N/A
Total SC & SBNA Originations 6,647$ 4,842$ 5,676$ 37% 17%
Asset Sales 1,475$ -$ 931$ N/A 58%
Average Managed Assets 48,421$ 48,972$ 51,230$ (1%) (5%)
% VarianceThree Months Ended Originations
7
0.49 0.51 0.56 0.51 0.51
2.11
2.26 2.25
2.07
2014 2015 2016 2017 2018
YTD Full Year
Chrysler Capital average quarterly penetration rate of 28% as of Q1 2018
Through SBNA, SC has increased dealer receivables outstanding (“floorplan”) 9% QoQ
FCA US LLC (FCA) RELATIONSHIP
SC continues to optimize the Chrysler Capital program
FCA Sales1
(units in millions)
1 FCA filings; sales as reported on 4/3/2018
2Dealer receivables originated through SBNA
Dealer Floorplan2 Outstanding
($ in millions)
$1,742 $1,723 $1,777
$1,963
$2,133
1Q17 2Q17 3Q17 4Q17 1Q18
8
$11,015
$9,881 $9,957
$8,639 $8,723
1Q17 2Q17 3Q17 4Q17 1Q18
$ in Millions
Santander Flow Sales 931 566 1,347 1,480
SBNA Originations 24
RV/Marine Sale 135
Santander Flow Sales totaling $1.5 billion
in Q1 2018
Launched pilot program with SBNA to
facilitate origination and servicing of
primarily Chrysler loans
Recent trend in total balance related to
lower prime originations and timing of
asset sales to Santander
SERVICED FOR OTHERS (SFO) PLATFORM
Composition at
03/31/2018
RIC 92%
Leases 1%
RV/Marine 7%
Total 100%
Serviced for Others Balances (End of Period)
*Sales with retained servicing during period, also include non-Santander sales.
9
March 31, 2018 December 31, 2017 March 31, 2017 QoQ YoY
Interest on finance receivables and loans 1,114,137$ 1,129,181$ 1,209,186$ (1%) (8%)
Net leased vehicle income 145,595 112,491 128,062 29% 14%
Other finance and interest income 7,137 4,470 3,825 60% 87%
Interest expense 241,028 236,600 227,089 2% 6%
Net finance and other interest income 1,025,841$ 1,009,542$ 1,113,984$ 2% (8%)
Provision for credit losses 458,995 562,346 635,013 (18%) (28%)
Profit sharing 4,377 7,235 7,945 (40%) (45%)
Total other income 25,053 (37,716) 55,480 (166%) (55%)
Total operating expenses 287,912 426,040 305,078 (32%) (6%)
Income before tax 299,610$ (23,795)$ 221,428$ NM 35%
Income tax expense 57,311 (603,911) 78,001 (109%) (27%)
Net income 242,299$ 580,116$ 143,427$ (58%) 69%
Diluted EPS ($) 0.67$ 1.61$ 0.40$ (58%) 68%
Average total assets 39,694,041$ 38,992,937$ 38,910,193$ 2% 2%
Average managed assets 48,421,303$ 48,971,677$ 51,229,729$ (1%) (5%)
% Variance
Three Months Ended
(Unaudited, Dollars in Thousands, except per share)
Q1 2018 FINANCIAL RESULTS
1
1 Q4 2017 was impacted by significant items. Please refer to the 8-K filed January 31, 2018 for further details.
10
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
Cum
u
la
ti
ve
N
et
L
o
ss
Ra
te
Months on Book
Total Annual Vintage Cumulative Net Loss Rate
2014 2015 2016
CREDIT QUALITY: VINTAGE LOSS PERFORMANCE
2016 vintage continues to outperform the 2015 vintage on a gross and net loss basis
*Retained originations only
0%
5%
10%
15%
20%
25%
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
Cum
u
la
ti
ve
G
ro
ss
L
o
ss
Ra
te
Months on Book
Total Annual Vintage Cumulative Gross Loss Rate
2014 2015 2016
11DELINQUENCY AND LOSS
YoY delinquency ratios flat
18.1%
16.4%
18.0%
19.2%
18.5%
8.8%
7.5%
9.1%
10.3%
8.3%
51.1%
53.9%
49.3%
46.4%
55.1%
30.0%
40.0%
50.0%
60.0%
70.0%
80.0%
90.0%
100.0%
110.0%
120.0%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018
Credit: Individually Acquired Retail Installment Contracts,
Held for Investment
Gross Charge-
off Ratio
Net Charge-
off Ratio
Recovery
Rate (as % of
recorded
investment)
YoY gross charge-off ratio increased 40 basis points
YoY net charge-off ratio decreased 50 basis points
7.3%
9.4% 9.2%
10.3%
7.3%
3.9%
4.7% 5.1%
5.4%
3.8%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018
Delinquency: Individually Acquired Retail Installment Contracts,
Held for Investment
31-60
>60
12CREDIT QUALITY: LOSS DETAIL
$599
$538
$24
$42
$27
$16
Q1 2017 Performance Recoveries Balance Other Q1 2018
Q1 2017 to Q1 2018 Net Charge-Off Walk
($ in millions)
Gross Loss
Performance
13
$635
$521 $536
$562
$459
12.7% 12.6%
12.8%
12.6%
12.3%
12.0%
12.5%
13.0%
13.5%
14.0%
$0
$100
$200
$300
$400
$500
$600
$700
Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018
Provision Expense and Allowance Ratio
($ in millions)
Provision for credit losses Allowance Ratio
PROVISION AND RESERVES
1 TDR migration – the allowance for assets classified as TDRs or “troubled debt restructuring” takes into consideration expected lifetime losses, typically requiring additional coverage
2 Explanation of quarter over quarter variance are estimates
QoQ allowance decreased $80 million
New volume and TDR migration1 were offset
by performance adjustment and liquidations
and other
Allowance to loans ratio decreased 30 bps to 12.3% QoQ
Provision for credit losses decreased $176 million YoY
$3,270
$3,190
$140
$59 ($70)
($209)
$3,100
$3,150
$3,200
$3,250
$3,300
$3,350
$3,400
$3,450
$3,500
Q4 2017 New
Volume
TDR
Migration
Performance
Adjustment
Liquidations
& Other
Q1 2018
Q4 2017 to Q1 2018 ALLL Reserve Walk
($ in millions)
14
TDR balances down two consecutive quarters
TDR BALANCE COMPOSITION BY VINTAGE
59% 51% 44% 38% 32% 28% 23% 21% 19%
36%
36%
34%
32%
29%
26%
24%
22%
21%
5% 13%
22% 30%
35%
37%
37%
37%
35%
4% 9%
16%
20%
24%
$ 4.7
$ 5.0
$ 5.3
$ 5.6
$ 5.8
$ 5.9
$ 6.3 $ 6.3
$ 6.0
1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18
TDR Balance by Origination Vintage (% of total balance)
2013 & Prior 2014 2015 2016 2017
1%
15EXPENSE MANAGEMENT
Operating expenses totaled $288 million, a decrease of 6% versus the same quarter last year
1 Q4 2017 was impacted by significant items. Please refer to the 8-K filed January 31, 2018 for further details.
1
$51,230 $50,436 $49,998 $48,972 $48,421
$305
$282
$298
$426
$288
2.4% 2.2% 2.4%
3.5%
2.4%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
$2
$10,002
$20,002
$30,002
$40,002
$50,002
$60,002
Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018
Average
Managed
Assets
($ millions)
Total Expenses
($ millions)
Expense Ratio
16
3.0 3.0
1.8 1.8
3.0 3.0
Q4 2017 Q1 2018
Term
Revolving
Contingent
4.1 4.6
5.8 5.4
Q4 2017 Q1 2018
Unused Used
$16.9 billion in commitments from 12 lenders1
54% unused capacity on revolving lines at Q1 2018
FUNDING AND LIQUIDITY
Total funding of $42.2 billion at the end Q1 2018, up 5% from $40.3 billion at the end of Q4 2017
Asset-Backed Securities
($ Billions)
Financings
($ Billions)
Banco Santander & Subsidiaries
($ Billions)
Asset Sales
($ Billions)
$3.3 billion in asset-backed securities (ABS) offered and sold
Executed second lease ABS securitization
$7.8 billion in total commitments
52% unused revolving capacity at Q1 2018
Fourth Santander flow sale of $1.5 billion
Amortizing Revolving
9.9 10.0
Santander
7.87.8
1 Does not include repo facilities
1.5
Q4 2017 Q1 2018
7.6 6.9
Q4 2017 Q1 2018
15.0 16.0
Q4 2017 Q1 2018
17
13.8% 14.3%
15.0%
16.3%
16.9%
13.6% 14.1%
14.9%
16.2% 16.6%
Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018
CET1 TCE/TA
CONSISTENT CAPITAL GENERATION
1 Common Equity Tier 1 (CET1) Capital Ratio is a non-GAAP financial measure that begins with stockholders’ equity and then adjusts for AOCI, goodwill/intangibles, DTAs, cash flow hedges and
other regulatory exclusions over risk-weighted assets. See appendix for further details.
2 Tangible common equity to tangible assets is a non-GAAP financial measure defined as the ratio of Total equity, excluding Goodwill and intangible assets, to Total assets, excluding Goodwill
and intangible assets
1 2
SC has exhibited a strong ability to generate earnings and capital, while growing assets
Tangible Assets $38,956 $39,401 $38,657 $39,319 $39,940
Tangible Common Equity $5,313 $5,572 $5,780 $6,377 $6,621
$ in millions
The Company has declared a cash dividend of $0.05 per share, to be paid on May 14, 2018, to shareholders of record as of the close of
business on May 4, 2018
APPENDIX
19COMPANY ORGANIZATION
Other Subsidiaries
100% Ownership
Santander Holdings USA, Inc.
(“SHUSA’)
~68% Ownership
Santander Bank, N.A. Other Subsidiaries
Banco Santander, S.A. Spain
*Ownership percentages are approximates as of March 31, 2018
~32% Ownership
Santander Consumer USA Holdings Inc.
(“SC”)
Public Shareholders
20
2% 2% 2% 2% 2%
12% 12% 10% 10% 12%
18% 17% 14% 14% 14%
25% 24%
23% 24% 26%
13%
13%
13% 13%
15%
30% 33% 38% 36%
31%
1Q17 2Q17 3Q17 4Q17 1Q18
Originations by Credit (RIC1 only)
($ in millions)
>640
600-640
540-599
<540
No FICO
Commercial
$3,787 $4,055 $4,278$3,328 $3,014
DIVERSIFIED UNDERWRITING ACROSS FULL CREDIT SPECTRUM
Average loan balance in dollars $20,193 $20,816 $21,825 $22,013 $21,699
$2,664
1 RIC; Retail Installment Contract
2 Loans to commercial borrowers; no FICO score obtained
$2,940
2
47% 48%
55% 53% 50%
53% 52%
45% 47% 50%
1Q17 2Q17 3Q17 4Q17 1Q18
New/Used Originations
($ in millions)
Used
New
$3,787 $4,055 $4,278$3,328 $3,014
21HELD FOR INVESTMENT CREDIT TRENDS
Retail Installment Contracts1
1Held for investment; excludes assets held for sale
2
.8
% 1
2
.0
%
2
2
.3
%
3
1
.7
%
1
7
.4
%
1
3
.8
%
2
.5
% 1
1
.9
%
2
2
.4
%
3
1
.9
%
1
7
.3
%
1
4
.0
%
2
.4
% 1
1
.6
%
2
2
.4
%
3
2
.4
%
1
7
.5
%
1
3
.7
%
2
.5
% 1
1
.2
%
2
1
.8
%
3
2
.0
%
1
7
.4
%
1
5
.1
%
2
.2
% 1
1
.2
%
2
1
.6
%
3
2
.4
%
1
7
.6
%
1
5
.0
%
Commercial Unknown <540 540-599 600-639 >=640
Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018
22EXCLUDING PERSONAL LENDING DETAIL
1The $59 million of investment losses related to personal lending in Q1 2018, comprised of $106 million in customer default activity, partially offset by a $47 million decrease in
market discount, consistent with typical seasonal patterns.
1
Personal lending earned $68 million before operating expenses and taxes
Total
Personal
Lending
Excluding
Personal
Lending
Total
Personal
Lending
Excluding
Personal
Lending
Total
Personal
Lending
Excluding
Personal
Lending
Interest on finance receivables and loans $ 1,114,137 $ 89,260 $ 1,024,877 $ 1,129,181 $ 83,080 $ 1,046,101 $ 1,209,186 $ 92,449 $ 1,116,737
Net leased vehicle income 145,595 - 145,595 112,491 - 112,491 128,062 - 128,062
Other finance and interest income 7,137 - 7,137 4,470 - 4,470 3,825 - 3,825
Interest expense 241,028 10,992 230,036 236,600 13,998 222,602 227,089 12,013 215,076
Net finance and other interest income $ 1,025,841 $ 78,268 $ 947,573 $ 1,009,542 $ 69,082 $ 940,460 $ 1,113,984 $ 80,436 $ 1,033,548
Provision for credit losses 458,995 102 458,892 562,346 415 561,931 635,013 - 635,013
Profit sharing 4,377 207 4,170 7,235 877 6,358 7,945 (242) 8,187
Investment Gains (losses), net (86,520) (58,963) (27,557) (137,926) (136,393) (1,533) (76,399) (64,639) (11,760)
Servicing fee income 26,182 - 26,182 26,031 - 26,031 31,684 - 31,684
Fees, commissions and other 85,391 49,487 35,903 74,179 45,830 28,349 100,195 50,740 49,455
Total other income $ 25,053 $ (9,476) $ 34,529 $ (37,716) $ (90,563) $ 52,847 $ 55,480 $ (13,899) $ 69,379
Average gross individually acquired retail
installment contracts
$ 26,820,166 - $ 27,098,976 - $ 28,200,907 -
Average gross personal loans - $ 1,459,308 - $ 1,392,529 - $ 1,488,665
Average gross operating leases $ 11,441,789 - $ 11,088,361 - $ 9,849,077 -
March 31, 2018 December 31, 2017 March 31, 2017
23CONSOLIDATED BALANCE SHEETS
(Unaudited, dollars in thousands) March 31, 2018 December 31, 2017
Assets
Cash and cash equivalents $ 618,809 $ 527,805
Finance receivables held for sale, net 1,611,535 2,210,421
Finance receivables held for investment, net 22,587,358 22,427,769
Restricted cash 2,895,615 2,553,902
Accrued interest receivable 269,258 326,640
Leased vehicles, net 10,612,824 10,160,327
Furniture and equipment, net 65,961 69,609
Federal, state and other income taxes receivable 99,099 95,060
Related party taxes receivable 634 467
Goodwill 74,056 74,056
Intangible assets 31,088 29,734
Due from affiliates 53,408 33,270
Other assets 1,125,544 913,244
Total assets $ 40,045,189 $ 39,422,304
Liabilities and Equity
Liabilities:
Notes payable — credit facilities $ 5,294,358 $ 4,848,316
Notes payable — secured structured financings 22,862,607 22,557,895
Notes payable — related party 3,148,194 3,754,223
Accrued interest payable 38,375 38,529
Accounts payable and accrued expenses 430,361 429,531
Deferred tax liabilities, net 966,444 897,121
Due to affiliates 103,012 82,382
Other liabilities 475,822 333,806
Total liabilities $ 33,319,174 $ 32,941,803
Equity:
Common stock, $0.01 par value $ 3,610 $ 3,605
Additional paid-in capital 1,689,996 1,681,558
Accumulated other comprehensive income (loss), net 63,211 44,262
Retained earnings 4,969,198 4,751,076
Total stockholders’ equity $ 6,726,015 $ 6,480,501
Total liabilities and equity $ 40,045,189 $ 39,422,304
For the Three Months Ended
24CONSOLIDATED INCOME STATEMENT
(Unaudited, dollars in thousands, except per share amounts) March 31, 2018 March 31, 2017
Interest on finance receivables and loans $ 1,114,137 $ 1,209,186
Leased vehicle income 504,278 418,233
Other finance and interest income 7,137 3,825
Total finance and other interest income $ 1,625,552 $ 1,631,244
Interest expense 241,028 227,089
Leased vehicle expense 358,683 290,171
Net finance and other interest income $ 1,025,841 $ 1,113,984
Provision for credit losses 458,995 635,013
Net finance and other interest income after provision for credit losses $ 566,846 $ 478,971
Profit sharing 4,377 7,945
Net finance and other interest income after provision for credit losses and profit sharing $ 562,469 $ 471,026
Investment (losses), net (86,520) (76,399)
Servicing fee income 26,182 31,684
Fees, commissions, and other 85,391 100,195
Total other income $ 25,053 $ 55,480
Compensation expense 122,005 136,262
Repossession expense 72,081 71,299
Other operating costs 93,826 97,517
Total operating expenses $ 287,912 $ 305,078
Income before income taxes 299,610 221,428
Income tax expense 57,311 78,001
Net income $ 242,299 $ 143,427
Net income per common share (basic) $ 0.67 $ 0.40
Net income per common share (diluted) $ 0.67 $ 0.40
Dividends paid per common share $0.05 -
Weighted average common shares (basic) 360,703,234 359,105,050
Weighted average common shares (diluted) 361,616,732 360,616,032
For the Three Months Ended
25RECONCILIATION OF NON-GAAP MEASURES
(a) Under the banking agencies' risk-based capital guidelines, assets and credit equivalent amounts of derivatives and off-balance sheet exposures are assigned to broad risk categories. The
aggregate dollar amount in each risk category is multiplied by the associated risk weight of the category. The resulting weighted values are added together with the measure for market risk,
resulting in the Company's and the Bank's total Risk weighted assets
(b) CET1 is calculated under Basel III regulations required as of January 1, 2015.
March 31, December 31, September 30, June 30, March 31,
2018 2017 2017 2017 2017
Total equity $ 6,726,015 $ 6,480,501 $ 5,885,234 $ 5,678,733 $ 5,418,998
Deduct: Goodwill and intangibles 105,144 103,790 105,590 106,298 106,331
Tangible common equity $ 6,620,871 $ 6,376,711 $ 5,779,644 $ 5,572,435 $ 5,312,667
Total assets $ 40,045,188 $ 39,422,304 $ 38,765,557 $ 39,507,482 $ 39,061,940
Deduct: Goodwill and intangibles 105,144 103,790 105,590 106,298 106,331
Tangible assets $ 39,940,044 $ 39,318,514 $ 38,659,967 $ 39,401,184 $ 38,955,609
Equity to assets ratio 16.8% 16.4% 15.2% 14.4% 13.9%
Tangible common equity to tangible assets 16.6% 16.2% 14.9% 14.1% 13.6%
Total equity 6,726,015$ 6,480,501$ 5,885,234$ 5,678,733$ 5,418,998$
Deduct: Goodwill and other intangible assets, net of deferred tax liabilities 169,870 172,664 172,502 177,619 182,156
Deduct: Accumulated other comprehensive income, net 63,211 44,262 27,481 27,860 35,504
Tier 1 common capital 6,492,934$ 6,263,575$ 5,685,251$ 5,473,254$ 5,201,338$
Risk weighted assets (a) 38,517,988$ 38,473,339$ 37,828,130$ 38,368,928$ 37,799,513$
Common Equity Tier 1 capital ratio (b) 16.9% 16.3% 15.0% 14.3% 13.8%
(Unaudited, dollars in thousands)
