Onemain Holdings, Inc. · NYSE:OMF
Onemain — Springleaf Holdings — Structured Finance Industry Group (SFIG) Conference 2014
26 slides from Onemain's conference presentation, January 2014
Slide 1: Structured Finance Industry Group (SFIG) Conference Presentation
Structured Finance Industry Group (SFIG) Conference Presentation January 2014
Slide 2: Qualification and Safe Harbor Disclaimer
Qualification and Safe Harbor Disclaimer This presentation does not constitute an offer or invitation to subscribe for or purchase any securities and nothing contained herein shall form the basis of any contract or commitment whatsoever. Non‐GAAP Financial Measures We present Adjusted Pretax Earning
Slide 3: Important Information
Important Information The following slides are part of a presentation by Springleaf Holdings, Inc. (the "Company") in connection with a Structured Finance Industry Group (SFIG) conference presentation and are intended to be viewed as part of that presentation. No representation is made that the info
Slide 4: Springleaf Overview
Springleaf Overview Leading consumer finance company – offering loans through nationwide branch network and online platform Focused on growing consumer loan business and uniquely positioned to capitalize on supply‐ demand imbalance within the non‐prime lending space Springleaf believes in outs
Slide 5: Springleaf Today
Springleaf Today Since Fortress acquisition in October 2010, appointed CEO, CFO, Management Team CRO, General Counsel, and heads of Capital Markets, Marketing, and Human Resources Re‐focused business exclusively on consumer lending Consumer Lending Commenced run‐off of mortgage business Cons
Slide 6: Personal Loans: Large Borrower Demand, Limited Supply
Large Borrower Demand, Limited Supply Uniquely positioned to capitalize on supply‐demand imbalance within the non‐prime lending space – Large and Growing Non‐Prime Population: 188 million Americans earn less than $75,000(1) – Limited Liquidity: Nearly half of Americans do not believe they could ra
Slide 7: Few Lending Alternatives
Few Lending Alternatives Of those still lending today: – Banks are mainly lending to prime borrowers – Payday lenders are under intense regulatory scrutiny Springleaf offers responsible alternative for borrowers seeking affordable personal loans Deep Sub‐Prime Non‐Prime/Near‐Prime Prime/Super‐Pr
Slide 8: Springleaf Customer Profile
Springleaf Customer Profile Borrowers typically have consistent income and solid job history but are credit constrained – Borrowers rely on our loans for: • Loan Consolidation • Home / Auto Repair • Unexpected Life Events Borrowers are also technologically adept – 93% bank online(1) – 81% own sm
Slide 9: Springleaf Personal Loan Underwriting
Springleaf Personal Loan Underwriting Capacity Character Collateral Income to repay Willingness to repay Additional loan support Time tested underwriting principles produce consistently strong performance – Enhanced by proprietary data – Active user of alternative data (e.g. utility and rent payme
Slide 10: Springleaf Personal Loan Profile
Springleaf Personal Loan Profile Springleaf makes 3 basic types of personal loans – Hard Secured predominantly by automobiles – Soft Secured by untitled consumer assets e.g. household goods – Unsecured (higher credit quality customers) Typical Loan Profile(1) Typical Loan Economics(2) Size: $4,2
Slide 11: Focus On Consumer Lending, Conservative Underwriting
Focus On Consumer Lending, Conservative Underwriting Consumer Lending Portfolio Continues To Increase… …Along With Receivables Per Branch ($ mm) ($ mm) $3,500 $4.0 24% increase since 2010 $2,968 $3,000 $3.6 $2,545 $2,389 $2,414 $3.5 50% increase since 2010 $2,500 $2,000 $3.1 $3.0 $1,500 $1,000 $2.5
Slide 12: Mortgage Portfolio Highlights
Mortgage Portfolio Highlights Mortgage Portfolio Summary Substantially all loans are: ($ mm) $15,000 5.0% — First lien $13,327 Conservatively — Fixed rate $11,858 Underwritten $12,000 $10,553 4.0% — Fully documented $9,620 — Fully amortizing $9,000 3.4% 3.2% 3.0% 2.7% $6,000 2.0% 2.2% 7 securiti
Slide 13: Regulatory Framework & Compliance
Regulatory Framework & Compliance State Regulation ‒ Subject to supervision by state financial regulators, and the Indiana Department of Insurance ‒ Over 800 state exams conducted each year ‒ Licensed in all 50 states ‒ Positive exam results with no material findings Federal Regulation ‒ CFPB wi
Slide 14: Liquidity and Funding
Liquidity and Funding Strong and stable liquidity position – $1bn committed undrawn funding capacity from three money‐center banks – Ample liquidity in place to repay all debt maturing over the next twelve months Deep and diversified funding sources Driving down weighted average cost of funds
Slide 15: Securitization Programs
Securitization Programs QDSpringleaf 15
Slide 16: Overview of Securitization Programs
Overview of Securitization Programs 2 personal loan ABS deals issued in 2013 ABS Program – $600 million inaugural securitization (February 2013) (“SLFT”) – $400 million follow on transaction (June 2013) SpringCastle Acquired $3.9 billion HSBC portfolio in April 2013 Securitization – Concurrent c
Slide 17: ABS Program (SLFT) Overview
ABS Program (“SLFT”) Overview Springleaf expects to be a programmatic issuer for consumer loan ABS − $6.5 billion managed portfolio(1,2) • $3.0 billion Springleaf originations(1,2) • $3.5 billion via SpringCastle acquisition (April 2013) (1,2) The consumer loan ABS platform benefits from a robus
Slide 18: Conservative Amortization Profile
Conservative Amortization Profile With non‐declining overcollateralization and locked‐out subordinate tranches, credit enhancement builds rapidly during the amortization period − The amortization profile and WAL for the notes are similar under a variety of CPR assumptions − Nearly 60% of the ABS N
Slide 19: Actual Losses Are A Fraction Of S&P Base Case Losses
Actual Losses Are A Fraction Of S&P Base Case Losses 3 Month Net Annualized Losses and WAC Cumulative Losses 36.0% 24.0% S&P Implied Cum. Losses 22.3% 2013‐B WAC 2013‐A WAC 20.0% 30.0% 26.3% 26.4% 24.0% 16.0% S&P Net Ann. Loss Assumption 17.5% 18.0% 12.0% 12.0% 2013‐B Net 2013‐A Net 8.0% Ann. Losses
Slide 20: SpringCastle ABS Securitization (SCFT) Overview
SpringCastle ABS Securitization (“SCFT”) Overview In April 2013, Springleaf acquired a 47% interest in a $3.9 billion HSBC consumer portfolio − Collateral consists of both closed end and revolving, mortgage and non‐mortgage receivables − Acquired a servicing center in London, KY with over 200 empl
Slide 21: Strong Portfolio Performance
Strong Portfolio Performance Cumulative Net Losses 60+ Delinquency 16.0% 16.0% 12.0% 12.0% 9.7% Net Loss Trigger 9.2% 8.0% 8.0% 6.1% SCFT Net Losses 4.0% 4.0% 0.0% 0.0% 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 Steadily Increasing Credit Enhancement Class A Credit Enhancement 80.0% 60.0%
Slide 22: RMBS Program (SLFMT) Overview
RMBS Program (“SLFMT”) Overview Springleaf has been an active issuer of RMBS deals since 2006 − Managed portfolio is $9.6 billion of mortgage loans − Completed 3 RMBS deals in 2013 − Mortgage securitizations have outperformed rating agency loss assumptions S&P actively monitors and assigns ratin
Slide 23: Low Cumulative Losses and Increasing Credit Enhancement
Low Cumulative Losses and Increasing Credit Enhancement 2012‐1 securitization is a reasonable representation of Springleaf RMBS performance Performance data available for all securitizations on Springleaf.com Cumulative Losses Investment Grade Bonds Credit Enhancement 2.0% 50.0% 40.0% 1.5% 30.0%
Slide 24: Enhanced Investor Transparency
Enhanced Investor Transparency Springleaf is pleased to announce the addition of an investor reporting website for our ABS, RMBS, and unsecured debt investors – Currently includes offering materials and servicing reports – Additional data will follow 24
Slide 25: Appendix
Appendix DSpringleaf 25
Slide 26: Reconciliation – Push-Down Accounting to Historical / Pretax Core Earnings
Reconciliation – Push‐Down Accounting to Historical / Pretax Core Earnings (unaudited, in millions) 3Q13 2Q13 1Q13 3Q12 1 Push‐Down Accounting Pretax Earnings (Loss) ($120) $84 ($12) ($69) Finance Charges (52) (52) (52) (51) Interest Expense 33 36 34 59 Provision for Receivable Losses 14 7 1 179 Net
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