Onemain Holdings, Inc. · NYSE:OMF
Onemain — Q1 2023 Earnings Presentation
18 slides from Onemain's earnings presentation, Apr 25, 2023
Slide 1: 1Q23 Financial Results
1Q23 Financial Results NYSE: OMF | April 25, 2023
Slide 2: Important Information
Important Information The following slides are part of a presentation by OneMain Holdings, Inc. (the "Company") in connection with reporting quarterly financial results and are intended to be viewed as part of that presentation. No representation is made that the information in these slides is compl
Slide 3: 1Q23 Financial Highlights
1Q23 Financial Highlights $2.8 billion $179 million $7.3 billion Originations Capital Generation* Undrawn Bank Facilities With conservative credit posture C&I Adj. Net Income* $177 million $8.5B Unencumbered loans* $20.6 billion 17.4% $750 million Managed Receivables* Net Interest Margin* 5.6% Auto
Slide 4: 1Q23 Financial Results
1Q23 Financial Results ($ in millions, except Average Assets and Average Net Receivables in billions, and per share statistics) Earnings Summary C&I* Adjusted Earnings Summary 1Q23 4Q22 1Q22 1Q23 4Q22 1Q22 Consumer & Insurance* $236 $249 $401 Interest Income $1,092 $1,121 $1,087 Other Net Revenue 12
Slide 5: Originations & Receivables (C&I)
Originations & Receivables (C&I)* ($ in billions, unless noted) Loan Originations Highlights $3.8 $3.9 $3.6 $3.5 • Maintained tightened underwriting standards and closely monitoring $3.0 $2.8 performance given the evolving macroeconomic environment • Continued positive competitive dynamics and growt
Slide 6: Targeted & Disciplined BrightWay Credit Card Rollout
Targeted & Disciplined BrightWay® Credit Card Rollout • >160,000 cards and $122 million in receivables at quarter end • Continued strong digital engagement • 85%+ of payments made in the app • App store ratings 4.5+ stars • Good spending patterns with top three categories: restaurants, retail stores
Slide 7: Loan Delinquency & Net Charge-off Trends (C&I)
Loan Delinquency & Net Charge-off Trends (C&I)* ($ in millions) Highlights • 30-89 delinquency down seasonally by 49 bps to 2.58%, up 33 bps vs 1Q22 • Net charge-offs continue to be supported by strong back-end collections and recoveries 30-89 Days Delinquent 90+ Days Delinquent $544 $534 $610 $553
Slide 8: Originations from new, higher credit quality vintages becoming a bigger part of the portfolio
Originations from new, higher credit quality vintages becoming a bigger part of the portfolio Highlights • Post tightening originations now represent 38% of portfolio; expected to be 65 – 70% of receivables by year-end 20231 • ~$9 billion originated since early Aug-2022 credit tightening – performan
Slide 9: Loss Reserve Trends (C&I)
Loss Reserve Trends (C&I)* ($ in millions) Highlights • Coverage ratio of 11.6% flat sequentially reflecting a continued uncertain macroeconomic environment • 1Q23 reserves reflect ($20) adjustment from the adoption of ASU 2022-02 recorded through retained earnings on 1/1/2023 $2,315 $2,298 $2,259 $
Slide 10: Operating Expenses (C&I)
Operating Expenses (C&I)* ($ in millions) Highlights • 1Q23 operating expense of $362 includes continued investment for growth in new products and distribution channels, data science, technology and digital capabilities • 1Q23 OpEx Ratio of 7.1% demonstrates continued expense discipline and the oper
Slide 11: Balance Sheet and Funding
Balance Sheet and Funding Bank Facilities Unsecured corporate revolver ($ in billions, unless noted) Conduit facilities $7.4 $7.4 $7.4 Highlights $7.0 $7.0 $1.0 $1.3 $1.3 $1.3 $1.3 • Significant liquidity with $7.4 of committed bank facilities • Well-positioned funding profile with balanced debt mix
Slide 12: Capital Allocation Framework
Capital Allocation Framework 1 2 Invest in the business and portfolio growth while Provide a predictable regular 3 maintaining leverage of 4-6x dividend that can continue • Portfolio generates strong return on adjusted capital* through a stress environment Make share repurchases a • Grew managed rec
Slide 13: Our Future Vision Deepens & Broadens Customer Relationships
Our Future Vision Deepens & Broadens Customer Relationships Unsecured Financial Loans Wellness Secured Loans Insurance Progress to a Meet the needs better future Credit of today Card Products & Services that increase engagement, Lending products OneMain Bill Negotiation build loyalty & provide Auto
Slide 14: Unique Business Model Supports Better Credit Outcomes
Unique Business Model Supports Better Credit Outcomes Highlights • OneMain’s unique hybrid business model combines superior underwriting with a nationwide branch network, central teams, and digital tools • Ability to work closely with customers across the delinquency spectrum drives better credit ou
Slide 15: Appendix
Appendix
Slide 16: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures (unaudited, $ in millions) 1Q23 4Q22 3Q22 2Q22 1Q22 FY22 FY21 Consumer & Insurance $236 $244 $247 $279 $399 $1,169 $1,788 Other (1) (1) 1 - - - (7) Segment to GAAP adjustment - (10) (2) (1) - (14) (40) Income before income taxes - GAAP basis $235 $233 $246 $278 $3
Slide 17: Reconciliation of Non-GAAP Measures (cont'd)
Reconciliation of Non-GAAP Measures (cont’d) (unaudited, $ in millions) 3/31/2023 12/31/2022 9/30/2022 6/30/2022 3/31/2022 Consumer & Insurance $19,810 $19,987 $19,754 $19,449 $18,981 Segment to GAAP adjustment (1) (1) (2) (1) (2) Net finance receivables - GAAP basis $19,809 $19,986 $19,752 $19,448
Slide 18: Defined Terms
Defined Terms • Adjusted capital = adjusted tangible common equity + allowance for finance receivable losses (ALLL), net of tax • Available cash and cash equivalents = cash and cash equivalents – cash and cash equivalents held at our regulated insurance subsidiaries or is unavailable for general cor