UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT

OF 1934

For the quarterly period ended September 30, ~~2022~~2023

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE

ACT OF 1934

For the transition period from to

Commission file number

001-36129 (OneMain Holdings, Inc.)

001-06155 (OneMain Finance Corporation)

ONEMAIN HOLDINGS, INC.

ONEMAIN FINANCE CORPORATION

(Exact name of registrant as specified in its charter)

Delaware (OneMain Holdings, Inc.)

27-3379612

Indiana (OneMain Finance Corporation)

35-0416090

(State of incorporation)

(I.R.S. Employer Identification No.)

601 N.W. Second Street, Evansville, IN 47708

(Address of principal executive offices) (Zip code)

(812) 424-8031

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934:

OneMain Holdings, Inc.:

Title of each class

Trading Symbol

Name of each exchange on which registered

Common Stock, par value $0.01 per share

OMF

New York Stock Exchange

OneMain Finance Corporation: None

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

OneMain Holdings, Inc. Yes ☑ No ☐

OneMain Finance Corporation Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

OneMain Holdings, Inc. Yes ☑ No ☐

OneMain Finance Corporation Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

OneMain Holdings, Inc.:

Large accelerated filer

☑

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

OneMain Finance Corporation:

Large accelerated filer

☐

Accelerated filer

☐

Non-accelerated filer

☑

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

OneMain Holdings, Inc. ☐

OneMain Finance Corporation ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

OneMain Holdings, Inc. Yes ☐ No ☑

OneMain Finance Corporation Yes ☐ No ☑

At October 19, ~~2022,~~2023, there were ~~122,211,896~~119,904,122 shares of OneMain Holdings, Inc’s common stock, $0.01 par value, outstanding.

At October 19, ~~2022,~~2023, there were 10,160,021 shares of OneMain Finance Corporation’s common stock, $0.50 par value, outstanding.

TABLE OF CONTENTS



GLOSSARY		4

PART I — FINANCIAL INFORMATION

Item 1.	Financial Statements of OneMain Holdings, Inc. and Subsidiaries (Unaudited):
	Condensed Consolidated Balance Sheets	6
	Condensed Consolidated Statements of Operations	7
	Condensed Consolidated Statements of Comprehensive Income	8
	Condensed Consolidated Statements of Shareholders’ Equity	9
	Condensed Consolidated Statements of Cash Flows	11
	Financial Statements of OneMain Finance Corporation and Subsidiaries (Unaudited):
	Condensed Consolidated Balance Sheets	12
	Condensed Consolidated Statements of Operations	13
	Condensed Consolidated Statements of Comprehensive Income	14
	Condensed Consolidated Statements of Shareholder’s Equity	15
	Condensed Consolidated Statements of Cash Flows	1617
	Notes to the Condensed Consolidated Financial Statements	1718
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	3845
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	5863
Item 4.	Controls and Procedures	5964
	Controls and Procedures of OneMain Holdings, Inc.	5964
	Controls and Procedures of OneMain Finance Corporation	5964

PART II — OTHER INFORMATION

Item 1.	Legal Proceedings	6065
Item 1A.	Risk Factors	6065
Item 2.	Unregistered Sales of Equity Securities, ~~and~~ Use of Proceeds, and Issuer Purchases of Equity Securities	6065
Item 3.	Defaults Upon Senior Securities	6065
Item 4.	Mine Safety Disclosures	6065
Item 5.	Other Information	6065
Item 6.	Exhibit Index	6166

SIGNATURES
	OneMain Holdings, Inc. Signature	6267
	OneMain Finance Corporation Signature	6368

Table of Contents

GLOSSARY

Terms and abbreviations used in this report are defined below.


Term or Abbreviation						Definition


30-89 Delinquency ratio						net finance receivables 30-89 days past due as a percentage of net finance receivables

















ABS						asset-backed securities

Adjusted pretax income (loss)						a non-GAAP financial measure used by management as a key performance measure of our segment
AETR						annual effective tax rate
AHL						American Health and Life Insurance Company, an insurance subsidiary of OneMain Financial Holdings, LLC


Annual Report						the Annual Report on Form 10-K of OMH and OMFC for the fiscal year ended December 31, ~~2021,~~2022, filed with the SEC on February ~~11, 2022~~10, 2023





ASC						Accounting Standards Codification
ASU						Accounting Standards Update
ASU 2018-12						The accounting standard issued by FASB in August of 2018, Financial Services-Insurance: Targeted Improvements to the Accounting for Long-Duration Contracts
ASU 2022-02						The accounting standard issued by FASB in March of 2022, Financial Instruments - Credit Losses: Troubled Debt Restructurings and Vintage Disclosures
Average daily debt balance						average of debt for each day in the period
Average net receivables						average of ~~monthly average~~ net finance receivables ~~(net finance receivables at the beginning and end of~~for each ~~month divided by two)~~day in the period

Base Indenture						indenture, dated as of December 3, 2014, by and between OMFC and Wilmington Trust, National Association, as trustee, and guaranteed by OMH
Board						the OMH Board of Directors


C&I						Consumer and Insurance
CDO						collateralized debt obligations


CFPB						Consumer Financial Protection Bureau

CMBS						commercial mortgage-backed securities




~~Corporate AMT~~						~~Corporate Alternative Minimum Tax, as implemented by the Inflation Reduction Act~~
~~COVID-19~~						~~the global outbreak of a novel strain of coronavirus, including variants thereof~~







Exchange Act						Securities Exchange Act of 1934, as amended
FASB						Financial Accounting Standards Board


~~FICO~~						~~a credit score created by Fair Isaac Corporation~~




GAAP						generally accepted accounting principles in the United States of America
GAP						guaranteed asset protection

Gross charge-off ratio						annualized gross charge-offs as a percentage of average net receivables
Gross finance receivables						the unpaid principal balance of our personal loans. For precompute personal loans, unpaid principal balance is the gross contractual payments less the unaccreted balance of unearned finance charges. Credit card gross finance receivables equal the principal balance and billed interest and fees


Indenture						the Base Indenture, together with all subsequent Supplemental Indentures




~~IRA~~						~~Inflation Reduction Act, signed into law on August 16, 2022~~
Junior Subordinated Debenture						$350 million aggregate principal amount of 60-year junior subordinated debt issued by OMFC under an indenture dated January 22, 2007, by and between OMFC and Deutsche Bank Trust Company, as trustee, and guaranteed by OMH




Managed receivables						consist of our C&I net finance receivables and finance receivables serviced for our whole loan sale partners
Modified finance receivables						finance receivable contractually modified, subsequent to the adoption of ASU 2022-02 on January 1, 2023, as a result of the borrower’s financial difficulties
Moody’s


						Moody’s Investors Service, Inc.
Net charge-off ratio						annualized net charge-offs as a percentage of average net receivables
Net interest income						interest income less interest expense
~~NORA~~NYDFS						~~Notice and Opportunity to Respond and Advise~~New York Department of Financial Services


ODART						OneMain Direct Auto Receivables Trust






OMFC						OneMain Finance Corporation

Table of Contents


Term or Abbreviation						Definition

OMFH						OneMain Financial Holdings, LLC
OMFIT						OneMain Financial Issuance Trust
OMH						OneMain Holdings, Inc.

OneMain						OneMain Holdings, Inc. and OneMain Finance Corporation, collectively with their subsidiaries

Open accounts						consist of credit card accounts that are not charged-off or closed accounts with a zero balance as of period end
Other securities						primarily consist of equity securities and those securities for which the fair value option was elected. Other securities recognize unrealized gains and losses in investment revenues



Pretax capital generation						a non-GAAP financial measure used by management as a key performance measure of our segment, defined as C&I adjusted pretax income (loss) excluding the change in C&I allowance for finance receivable losses
Private Secured Term Funding						$350 million aggregate principal amount of debt collateralized by our personal loans issued on April 25, 2022
Purchase volume						consists of credit card purchase transactions in the period, including cash advances, net of returns
Recovery ratio						annualized recoveries on net charge-offs as a percentage of average net receivables


RMBS						residential mortgage-backed securities





SEC						U.S. Securities and Exchange Commission
Securities Act						Securities Act of 1933, as amended
Segment Accounting Basis						a basis used to report the operating results of our C&I segment and our Other components, which reflects our allocation methodologies for certain costs and excludes the impact of applying purchase accounting

























SpringCastle Portfolio						loans the Company previously owned and now services on behalf of a third party


Supplemental Indentures						collectively, the following supplements to the Base Indenture: ~~Fourth Supplemental Indenture, dated as of December 8, 2017;~~ Fifth Supplemental Indenture, dated as of March 12, 2018; Sixth Supplemental Indenture, dated as of May 11, 2018; Seventh Supplemental Indenture, dated as of February 22, 2019; Eighth Supplemental Indenture, dated as of May 9, 2019; Ninth Supplemental Indenture, dated as of November 7, 2019; Eleventh Supplemental Indenture, dated as of December 17, 2020; Twelfth Supplemental Indenture, dated as of June 22, 2021; ~~and~~ Thirteenth Supplemental Indenture, dated as of August 11, ~~2021~~2021; Fourteenth Supplemental Indenture, dated June 20, 2023; and Fifteenth Supplemental Indenture, dated June 22, 2023


Tax Act						Public Law 115-97 amending the Internal Revenue Code of 1986
TDR finance receivables						troubled debt restructured finance receivables. Debt restructuring, prior to the adoption of ASU 2022-02 on January 1, 2023, in which a concession iswas granted to the borrower as a result of economic or legal reasons related to the borrower’s financial difficulties


Triton						Triton Insurance Company, an insurance subsidiary of OneMain Financial Holdings, LLC



Unearned finance charges						the amount of interest that is capitalized at time of origination on a precompute loan that will be earned over the remaining contractual life of the loan

Unencumbered loans						unencumbered gross finance receivables excluding credit cards
Unsecured corporate revolver						unsecured revolver with a maximum borrowing capacity of $1.25 billion, payable and due on October 25, 2026
Unsecured Notes						the notes, on a senior unsecured basis, issued by OMFC and guaranteed by OMH


VIEs						variable interest entities

Weighted average interest rate						annualized interest expense as a percentage of average debt
XBRL						eXtensible Business Reporting Language
Yield						annualized finance charges as a percentage of average net receivables

Table of Contents

PART I - FINANCIAL INFORMATION


Item 1. Financial Statements.

ONEMAIN HOLDINGS, INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets (Unaudited)

(dollars in millions, except par value amount) September 30, 2022 December 31, 2021
Assets
Cash and cash equivalents $ 536 $ 541
Investment securities (includes available-for-sale securities with a fair value and an amortized cost basis of $1.7 billion and $1.9 billion in 2022, respectively, and $1.9 billion and $1.8 billion in 2021, respectively) 1,747 1,992
Net finance receivables (includes loans of consolidated VIEs of $10.1 billion in 2022 and $8.8 billion in 2021) 19,752 19,212
Unearned insurance premium and claim reserves (747) (761)
Allowance for finance receivable losses (includes allowance of consolidated VIEs of $1.1 billion in 2022 and $910 million in 2021) (2,255) (2,095)
Net finance receivables, less unearned insurance premium and claim reserves and allowance for finance receivable losses 16,750 16,356
Restricted cash and restricted cash equivalents (includes restricted cash and restricted cash equivalents of consolidated VIEs of $472 million in 2022 and $466 million in 2021) 483 476
Goodwill 1,437 1,437
Other intangible assets 272 274
Other assets 1,116 1,003
Total assets $ 22,341 $ 22,079
Liabilities and Shareholders’ Equity
Long-term debt (includes debt of consolidated VIEs of $9.2 billion in 2022 and $8.0 billion in 2021) $ 18,202 $ 17,750
Insurance claims and policyholder liabilities 600 621
Deferred and accrued taxes 5 1
Other liabilities (includes other liabilities of consolidated VIEs of $18 million in 2022 and $13 million in 2021) 522 614
Total liabilities 19,329 18,986
Contingencies (Note 12)
Shareholders’ equity:
Common stock, par value $0.01 per share; 2,000,000,000 shares authorized, 122,618,748 and 127,809,640 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively 1 1
Additional paid-in capital 1,685 1,672
Accumulated other comprehensive income (loss) (125) 61
Retained earnings 2,063 1,727
Treasury stock, at cost; 12,214,566 and 6,712,923 shares at September 30, 2022 and December 31, 2021, respectively (612) (368)
Total shareholders’ equity 3,012 3,093
Total liabilities and shareholders’ equity $ 22,341 $ 22,079


(dollars in millions, except par value amount)	September 30, 2023		December 31, 2022


Assets
Cash and cash equivalents	$	1,190	$	498
Investment securities (includes available-for-sale securities with a fair value and an amortized cost basis of $1.6 billion and $1.8 billion in 2023, respectively, and $1.7 billion and $1.9 billion in 2022, respectively)	1,635		1,800
Net finance receivables (includes loans of consolidated VIEs of $13.2 billion in 2023 and $10.4 billion in 2022)	21,067		19,986
Unearned insurance premium and claim reserves	(772)		(749)
Allowance for finance receivable losses (includes allowance of consolidated VIEs of $1.5 billion in 2023 and $1.1 billion in 2022)	(2,449)		(2,311)
Net finance receivables, less unearned insurance premium and claim reserves and allowance for finance receivable losses	17,846		16,926

Restricted cash and restricted cash equivalents (includes restricted cash and restricted cash equivalents of consolidated VIEs of $564 million in 2023 and $442 million in 2022)	580		461
Goodwill	1,437		1,437
Other intangible assets	260		261

Other assets	1,198		1,154
Total assets	$	24,146	$	22,537

Liabilities and Shareholders’ Equity
Long-term debt (includes debt of consolidated VIEs of $11.9 billion in 2023 and $9.4 billion in 2022)	$	19,851	$	18,281
Insurance claims and policyholder liabilities	599		620
Deferred and accrued taxes	6		5
Other liabilities (includes other liabilities of consolidated VIEs of $26 million in 2023 and $20 million in 2022)	581		616
Total liabilities	21,037		19,522
Contingencies (Note 12)

Shareholders’ equity:
Common stock, par value $0.01 per share; 2,000,000,000 shares authorized, 120,245,297 and 121,042,125 shares issued and outstanding at September 30, 2023 and December 31, 2022, respectively	1		1
Additional paid-in capital	1,706		1,689
Accumulated other comprehensive loss	(129)		(127)
Retained earnings	2,240		2,119
Treasury stock, at cost; 14,872,259 and 13,813,476 shares at September 30, 2023 and December 31, 2022, respectively	(709)		(667)
Total shareholders’ equity	3,109		3,015
Total liabilities and shareholders’ equity	$	24,146	$	22,537

See Notes to the Condensed Consolidated Financial Statements (Unaudited).

Table of Contents

ONEMAIN HOLDINGS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Operations (Unaudited)


		Three Months Ended September 30,				Nine Months Ended September 30,					Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in millions, except per share amounts)	(dollars in millions, except per share amounts)	2022		2021		2022		2021		(dollars in millions, except per share amounts)	2023		2022		2023		2022

Interest income	Interest income	$	1,118	$	1,113	$	3,313	$	3,244	Interest income	$	1,167	$	1,118	$	3,377	$	3,313

Interest expense	Interest expense	223		237		661		703		Interest expense	267		223		749		661

Net interest income	Net interest income	895		876		2,652		2,541		Net interest income	900		895		2,628		2,652

Provision for finance receivable losses	Provision for finance receivable losses	421		226		998		356		Provision for finance receivable losses	410		421		1,275		998

Net interest income after provision for finance receivable losses	Net interest income after provision for finance receivable losses	474		650		1,654		2,185		Net interest income after provision for finance receivable losses	490		474		1,353		1,654

Other revenues:	Other revenues:									Other revenues:
Insurance	Insurance	111		109		334		323		Insurance	113		111		335		334
Investment	Investment	16		14		40		47		Investment	32		16		83		40
Gain on sales of finance receivables	Gain on sales of finance receivables	17		15		50		30		Gain on sales of finance receivables	11		17		42		50
Net gain (loss) on repurchases and repayments of debt	Net gain (loss) on repurchases and repayments of debt	2		(1)		(26)		(49)		Net gain (loss) on repurchases and repayments of debt	—		2		1		(26)

Other	Other	24		18		62		45		Other	29		24		87		62
Total other revenues	Total other revenues	170		155		460		396		Total other revenues	185		170		548		460

Other expenses:	Other expenses:									Other expenses:
Salaries and benefits	Salaries and benefits	212		229		621		613		Salaries and benefits	217		212		649		621
Other operating expenses	Other operating expenses	151		155		451		457		Other operating expenses	164		151		494		451
Insurance policy benefits and claims	Insurance policy benefits and claims	31		45		116		125		Insurance policy benefits and claims	48		35		139		119
Total other expenses	Total other expenses	394		429		1,188		1,195		Total other expenses	429		398		1,282		1,191

Income before income taxes	Income before income taxes	250		376		926		1,386		Income before income taxes	246		246		619		923

Income taxes	Income taxes	62		88		228		335		Income taxes	52		61		143		227

Net income	Net income	$	188	$	288	$	698	$	1,051	Net income	$	194	$	185	$	476	$	696

Share Data:	Share Data:									Share Data:
Weighted average number of shares outstanding:	Weighted average number of shares outstanding:									Weighted average number of shares outstanding:
Basic	Basic	123,352,522		132,487,234		124,989,263		133,709,146		Basic	120,407,889		123,352,522		120,571,103		124,989,263
Diluted	Diluted	123,568,620		132,924,333		125,243,206		134,096,382		Diluted	120,754,694		123,568,620		120,790,485		125,243,206
Earnings per share:	Earnings per share:									Earnings per share:
Basic	Basic	$	1.52	$	2.17	$	5.58	$	7.86	Basic	$	1.61	$	1.50	$	3.95	$	5.56
Diluted	Diluted	$	1.52	$	2.17	$	5.57	$	7.84	Diluted	$	1.61	$	1.49	$	3.94	$	5.55

See Notes to the Condensed ~~Condensed~~ Consolidated Financial Statements (Unaudited).

Table of Contents

ONEMAIN HOLDINGS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Comprehensive Income (Unaudited)


		Three Months Ended September 30,				Nine Months Ended September 30,					Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in millions)	(dollars in millions)	2022		2021		2022		2021		(dollars in millions)	2023		2022		2023		2022

Net income	Net income	$	188	$	288	$	698	$	1,051	Net income	$	194	$	185	$	476	$	696

Other comprehensive income (loss):
Other comprehensive loss:										Other comprehensive loss:
Net change in unrealized losses on non-credit impaired available-for-sale securities	Net change in unrealized losses on non-credit impaired available-for-sale securities	(65)		(9)		(248)		(34)		Net change in unrealized losses on non-credit impaired available-for-sale securities	(28)		(65)		(19)		(248)

Foreign currency translation adjustments	Foreign currency translation adjustments	(10)		(2)		(13)		1		Foreign currency translation adjustments	(4)		(10)		—		(13)
Changes in discount rate for insurance claims and policyholder liabilities										Changes in discount rate for insurance claims and policyholder liabilities	8		18		15		73
Other	Other	4		1		24		12		Other	4		4		2		24
Income tax effect:	Income tax effect:									Income tax effect:
Net change in unrealized gains on non-credit impaired available-for-sale securities		15		2		57		8
Net change in unrealized losses on non-credit impaired available-for-sale securities										Net change in unrealized losses on non-credit impaired available-for-sale securities	6		15		4		57

Foreign currency translation adjustments	Foreign currency translation adjustments	2		—		3		—		Foreign currency translation adjustments	1		2		—		3
Changes in discount rate for insurance claims and policyholder liabilities										Changes in discount rate for insurance claims and policyholder liabilities	(1)		(4)		(3)		(16)
Other	Other	(1)		—		(6)		(3)		Other	(1)		(1)		(1)		(6)
Other comprehensive loss, net of tax, before reclassification adjustments	Other comprehensive loss, net of tax, before reclassification adjustments	(55)		(8)		(183)		(16)		Other comprehensive loss, net of tax, before reclassification adjustments	(15)		(41)		(2)		(126)
Reclassification adjustments included in net income, net of tax:	Reclassification adjustments included in net income, net of tax:									Reclassification adjustments included in net income, net of tax:
Net realized losses on available-for-sale securities, net of tax	Net realized losses on available-for-sale securities, net of tax	—		—		(3)		(1)		Net realized losses on available-for-sale securities, net of tax	—		—		—		(3)

Reclassification adjustments included in net income, net of tax	Reclassification adjustments included in net income, net of tax	—		—		(3)		(1)		Reclassification adjustments included in net income, net of tax	—		—		—		(3)
Other comprehensive loss, net of tax	Other comprehensive loss, net of tax	(55)		(8)		(186)		(17)		Other comprehensive loss, net of tax	(15)		(41)		(2)		(129)

Comprehensive income	Comprehensive income	$	133	$	280	$	512	$	1,034	Comprehensive income	$	179	$	144	$	474	$	567

See Notes to the Condensed Consolidated Financial Statements (Unaudited).

Table of Contents

ONEMAIN HOLDINGS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Shareholders’ Equity (Unaudited)


		OneMain Holdings, Inc. Shareholders’ Equity													OneMain Holdings, Inc. Shareholders’ Equity
(dollars in millions)	(dollars in millions)	Common Stock		Additional Paid-in Capital		Accumulated Other Comprehensive Income (Loss)		Retained Earnings		Treasury Stock		Total Shareholders’ Equity		(dollars in millions)	Common Stock		Additional Paid-in Capital		Accumulated Other Comprehensive Income (Loss)		Retained Earnings		Treasury Stock		Total Shareholders’ Equity

Three Months Ended September 30, 2023														Three Months Ended September 30, 2023

Balance, July 1, 2023														Balance, July 1, 2023	$	1	$	1,702	$	(114)	$	2,168	$	(699)	$	3,058
Common stock repurchased														Common stock repurchased	—		—		—		—		(11)		(11)
Treasury stock issued														Treasury stock issued	—		—		—		—		1		1
Share-based compensation expense, net of forfeitures														Share-based compensation expense, net of forfeitures	—		6		—		—		—		6
Withholding tax on share-based compensation														Withholding tax on share-based compensation	—		(2)		—		—		—		(2)
Other comprehensive loss														Other comprehensive loss	—		—		(15)		—		—		(15)
Cash dividends *														Cash dividends *	—		—		—		(122)		—		(122)
Net income														Net income	—		—		—		194		—		194
Balance, September 30, 2023														Balance, September 30, 2023	$	1	$	1,706	$	(129)	$	2,240	$	(709)	$	3,109

Three Months Ended September 30, 2022	Three Months Ended September 30, 2022													Three Months Ended September 30, 2022
Balance, July 1, 2022	Balance, July 1, 2022	$	1	$	1,679	$	(70)	$	1,994	$	(571)	$	3,033	Balance, July 1, 2022	$	1	$	1,679	$	(83)	$	1,995	$	(571)	$	3,021
Common stock repurchased	Common stock repurchased	—		—		—		—		(42)		(42)		Common stock repurchased	—		—		—		—		(42)		(42)
Treasury stock issued	Treasury stock issued	—		—		—		(1)		1		—		Treasury stock issued	—		—		—		(1)		1		—
Share-based compensation expense, net of forfeitures	Share-based compensation expense, net of forfeitures	—		8		—		—		—		8		Share-based compensation expense, net of forfeitures	—		8		—		—		—		8
Withholding tax on share-based compensation	Withholding tax on share-based compensation	—		(2)		—		—		—		(2)		Withholding tax on share-based compensation	—		(2)		—		—		—		(2)
Other comprehensive loss	Other comprehensive loss	—		—		(55)		—		—		(55)		Other comprehensive loss	—		—		(41)		—		—		(41)
Cash dividends *	Cash dividends *	—		—		—		(118)		—		(118)		Cash dividends *	—		—		—		(118)		—		(118)
Net income	Net income	—		—		—		188		—		188		Net income	—		—		—		185		—		185
Balance, September 30, 2022	Balance, September 30, 2022	$	1	$	1,685	$	(125)	$	2,063	$	(612)	$	3,012	Balance, September 30, 2022	$	1	$	1,685	$	(124)	$	2,061	$	(612)	$	3,011

Three Months Ended September 30, 2021
Balance, July 1, 2021		$	1	$	1,661	$	85	$	1,825	$	(35)	$	3,537
Common stock repurchased		—		—		—		—		(141)		(141)
Share-based compensation expense, net of forfeitures		—		4		—		—		—		4
* Cash dividends declared were $1.00 per share and $0.95 per share during the three months ended September 30, 2023 and 2022, respectively.														* Cash dividends declared were $1.00 per share and $0.95 per share during the three months ended September 30, 2023 and 2022, respectively.

Other comprehensive loss		—		—		(8)		—		—		(8)
Cash dividends *		—		—		—		(559)		—		(559)
Net income		—		—		—		288		—		288
Balance, September 30, 2021		$	1	$	1,665	$	77	$	1,554	$	(176)	$	3,121

* Cash dividends declared were $0.95 per share and $4.20 per share during the three months ended September 30, 2022 and 2021, respectively.

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																											ONEMAIN HOLDINGS, INC. AND SUBSIDIARIES	Condensed Consolidated Statements of Shareholders’ Equity (Unaudited) (Continued)
		OneMain Holdings, Inc. Shareholders’ Equity													OneMain Holdings, Inc. Shareholders’ Equity
(dollars in millions)	(dollars in millions)	Common Stock		Additional Paid-in Capital		Accumulated Other Comprehensive Income (Loss)		Retained Earnings		Treasury Stock		Total Shareholders’ Equity		(dollars in millions)	Common Stock		Additional Paid-in Capital		Accumulated Other Comprehensive Income (Loss)		Retained Earnings		Treasury Stock		Total Shareholders’ Equity

Nine Months Ended September 30, 2023														Nine Months Ended September 30, 2023
Balance, January 1, 2023														Balance, January 1, 2023	$	1	$	1,689	$	(127)	$	2,119	$	(667)	$	3,015
Net impact of adoption of ASU 2022-02 (see Note 2)														Net impact of adoption of ASU 2022-02 (see Note 2)	—		—		—		12		—		12
Balance, January 1, 2023 (post-adoption)														Balance, January 1, 2023 (post-adoption)	1		1,689		(127)		2,131		(667)		3,027
Common stock repurchased														Common stock repurchased	—		—		—		—		(45)		(45)
Treasury stock issued														Treasury stock issued	—		—		—		(1)		3		2
Share-based compensation expense, net of forfeitures														Share-based compensation expense, net of forfeitures	—		27		—		—		—		27
Withholding tax on share-based compensation														Withholding tax on share-based compensation	—		(10)		—		—		—		(10)
Other comprehensive loss														Other comprehensive loss	—		—		(2)		—		—		(2)
Cash dividends*														Cash dividends*	—		—		—		(366)		—		(366)
Net income														Net income	—		—		—		476		—		476
Balance, September 30, 2023														Balance, September 30, 2023	$	1	$	1,706	$	(129)	$	2,240	$	(709)	$	3,109

Nine Months Ended September 30, 2022	Nine Months Ended September 30, 2022													Nine Months Ended September 30, 2022
Balance, January 1, 2022	Balance, January 1, 2022	$	1	$	1,672	$	61	$	1,727	$	(368)	$	3,093	Balance, January 1, 2022	$	1	$	1,672	$	5	$	1,727	$	(368)	$	3,037
Common stock repurchased	Common stock repurchased	—		—		—		—		(247)		(247)		Common stock repurchased	—		—		—		—		(247)		(247)
Treasury stock issued	Treasury stock issued	—		—		—		(1)		3		2		Treasury stock issued	—		—		—		(1)		3		2
Share-based compensation expense, net of forfeitures	Share-based compensation expense, net of forfeitures	—		27		—		—		—		27		Share-based compensation expense, net of forfeitures	—		27		—		—		—		27
Withholding tax on share-based compensation	Withholding tax on share-based compensation	—		(14)		—		—		—		(14)		Withholding tax on share-based compensation	—		(14)		—		—		—		(14)
Other comprehensive loss	Other comprehensive loss	—		—		(186)		—		—		(186)		Other comprehensive loss	—		—		(129)		—		—		(129)
Cash dividends *		—		—		—		(361)		—		(361)
Cash dividends*														Cash dividends*	—		—		—		(361)		—		(361)
Net income	Net income	—		—		—		698		—		698		Net income	—		—		—		696		—		696
Balance, September 30, 2022	Balance, September 30, 2022	$	1	$	1,685	$	(125)	$	2,063	$	(612)	$	3,012	Balance, September 30, 2022	$	1	$	1,685	$	(124)	$	2,061	$	(612)	$	3,011

Nine Months Ended September 30, 2021
Balance, January 1, 2021		$	1	$	1,655	$	94	$	1,691	$	—	$	3,441

Common stock repurchased		—		—		—		—		(176)		(176)
Share-based compensation expense, net of forfeitures		—		16		—		—		—		16
Withholding tax on share-based compensation		—		(6)		—		—		—		(6)
Other comprehensive loss		—		—		(17)		—		—		(17)
Cash dividends *		—		—		—		(1,188)		—		(1,188)
Net income		—		—		—		1,051		—		1,051
Balance, September 30, 2021		$	1	$	1,665	$	77	$	1,554	$	(176)	$	3,121

* Cash dividends declared were $2.85 per share and $8.85 per share during the nine months ended September 30, 2022 and 2021, respectively.


* Cash dividends declared were $3.00 per share and $2.85 per share during the nine months ended September 30, 2023 and 2022, respectively.														* Cash dividends declared were $3.00 per share and $2.85 per share during the nine months ended September 30, 2023 and 2022, respectively.

See Notes to the Condensed Consolidated Financial Statements (Unaudited).

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ONEMAIN HOLDINGS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows (Unaudited)


		Nine Months Ended September 30,					Nine Months Ended September 30,
(dollars in millions)	(dollars in millions)	2022		2021		(dollars in millions)	2023		2022

Cash flows from operating activities	Cash flows from operating activities					Cash flows from operating activities
Net income	Net income	$	698	$	1,051	Net income	$	476	$	696
Reconciling adjustments:	Reconciling adjustments:					Reconciling adjustments:
Provision for finance receivable losses	Provision for finance receivable losses	998		356		Provision for finance receivable losses	1,275		998
Depreciation and amortization	Depreciation and amortization	188		197		Depreciation and amortization	191		188
Deferred income tax charge (benefit)		(44)		57
Net loss on repurchases and repayments of debt		26		49
Deferred income tax benefit						Deferred income tax benefit	(30)		(45)
Net loss (gain) on repurchases and repayments of debt						Net loss (gain) on repurchases and repayments of debt	(1)		26
Share-based compensation expense, net of forfeitures	Share-based compensation expense, net of forfeitures	27		16		Share-based compensation expense, net of forfeitures	27		27
Gain on sales of finance receivables	Gain on sales of finance receivables	(50)		(30)		Gain on sales of finance receivables	(42)		(50)
Other	Other	4		(4)		Other	(1)		4
Cash flows due to changes in other assets and other liabilities	Cash flows due to changes in other assets and other liabilities	(124)		(53)		Cash flows due to changes in other assets and other liabilities	(54)		(121)
Net cash provided by operating activities	Net cash provided by operating activities	1,723		1,639		Net cash provided by operating activities	1,841		1,723

Cash flows from investing activities	Cash flows from investing activities					Cash flows from investing activities
Net principal originations and purchases of finance receivables	Net principal originations and purchases of finance receivables	(2,010)		(1,738)		Net principal originations and purchases of finance receivables	(2,726)		(2,010)

Proceeds from sales of finance receivables	Proceeds from sales of finance receivables	599		361		Proceeds from sales of finance receivables	493		599
Available-for-sale securities purchased	Available-for-sale securities purchased	(406)		(347)		Available-for-sale securities purchased	(129)		(406)
Available-for-sale securities called, sold, and matured	Available-for-sale securities called, sold, and matured	370		294		Available-for-sale securities called, sold, and matured	274		370
Other securities purchased	Other securities purchased	(5)		(706)		Other securities purchased	(4)		(5)
Other securities called, sold, and matured	Other securities called, sold, and matured	11		691		Other securities called, sold, and matured	5		11
Other, net	Other, net	(56)		(54)		Other, net	(65)		(56)
Net cash used for investing activities	Net cash used for investing activities	(1,497)		(1,499)		Net cash used for investing activities	(2,152)		(1,497)

Cash flows from financing activities	Cash flows from financing activities					Cash flows from financing activities
Proceeds from issuance and borrowings of long-term debt, net of issuance costs	Proceeds from issuance and borrowings of long-term debt, net of issuance costs	4,479		2,168		Proceeds from issuance and borrowings of long-term debt, net of issuance costs	3,743		4,479
Repayments and repurchases of long-term debt	Repayments and repurchases of long-term debt	(4,080)		(2,384)		Repayments and repurchases of long-term debt	(2,202)		(4,080)
Cash dividends	Cash dividends	(364)		(1,185)		Cash dividends	(366)		(364)
Common stock repurchased	Common stock repurchased	(247)		(176)		Common stock repurchased	(45)		(247)
Treasury stock issued	Treasury stock issued	2		—		Treasury stock issued	2		2
Withholding tax on share-based compensation	Withholding tax on share-based compensation	(14)		(6)		Withholding tax on share-based compensation	(10)		(14)
Net cash used for financing activities		(224)		(1,583)
Net cash provided by (used for) financing activities						Net cash provided by (used for) financing activities	1,122		(224)

Net change in cash and cash equivalents and restricted cash and restricted cash equivalents	Net change in cash and cash equivalents and restricted cash and restricted cash equivalents	2		(1,443)		Net change in cash and cash equivalents and restricted cash and restricted cash equivalents	811		2
Cash and cash equivalents and restricted cash and restricted cash equivalents at beginning of period	Cash and cash equivalents and restricted cash and restricted cash equivalents at beginning of period	1,017		2,723		Cash and cash equivalents and restricted cash and restricted cash equivalents at beginning of period	959		1,017
Cash and cash equivalents and restricted cash and restricted cash equivalents at end of period	Cash and cash equivalents and restricted cash and restricted cash equivalents at end of period	$	1,019	$	1,280	Cash and cash equivalents and restricted cash and restricted cash equivalents at end of period	$	1,770	$	1,019

Supplemental cash flow information	Supplemental cash flow information					Supplemental cash flow information
Cash and cash equivalents	Cash and cash equivalents	$	536	$	821	Cash and cash equivalents	$	1,190	$	536
Restricted cash and restricted cash equivalents	Restricted cash and restricted cash equivalents	483		459		Restricted cash and restricted cash equivalents	580		483
Total cash and cash equivalents and restricted cash and restricted cash equivalents	Total cash and cash equivalents and restricted cash and restricted cash equivalents	$	1,019	$	1,280	Total cash and cash equivalents and restricted cash and restricted cash equivalents	$	1,770	$	1,019

Restricted cash and restricted cash equivalents primarily represent funds required to be used for future debt payments relating to our secured transactions.

See Notes to the Condensed Consolidated Financial Statements (Unaudited).

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ONEMAIN FINANCE CORPORATION AND SUBSIDIARIES

Condensed Consolidated Balance Sheets (Unaudited)


(dollars in millions, except par value amount)	(dollars in millions, except par value amount)	September 30, 2022		December 31, 2021		(dollars in millions, except par value amount)	September 30, 2023		December 31, 2022

Assets	Assets					Assets
Cash and cash equivalents	Cash and cash equivalents	$	512	$	510	Cash and cash equivalents	$	1,187	$	490
Investment securities (includes available-for-sale securities with a fair value and an amortized cost basis of $1.7 billion and $1.9 billion in 2022, respectively, and $1.9 billion and $1.8 billion in 2021, respectively)		1,747		1,992
Net finance receivables (includes loans of consolidated VIEs of $10.1 billion in 2022 and $8.8 billion in 2021)		19,752		19,212
Investment securities (includes available-for-sale securities with a fair value and an amortized cost basis of $1.6 billion and $1.8 billion in 2023, respectively, and $1.7 billion and $1.9 billion in 2022, respectively)						Investment securities (includes available-for-sale securities with a fair value and an amortized cost basis of $1.6 billion and $1.8 billion in 2023, respectively, and $1.7 billion and $1.9 billion in 2022, respectively)	1,635		1,800
Net finance receivables (includes loans of consolidated VIEs of $13.2 billion in 2023 and $10.4 billion in 2022)						Net finance receivables (includes loans of consolidated VIEs of $13.2 billion in 2023 and $10.4 billion in 2022)	21,067		19,986
Unearned insurance premium and claim reserves	Unearned insurance premium and claim reserves	(747)		(761)		Unearned insurance premium and claim reserves	(772)		(749)
Allowance for finance receivable losses (includes allowance of consolidated VIEs of $1.1 billion in 2022 and $910 million in 2021)		(2,255)		(2,095)
Allowance for finance receivable losses (includes allowance of consolidated VIEs of $1.5 billion in 2023 and $1.1 billion in 2022)						Allowance for finance receivable losses (includes allowance of consolidated VIEs of $1.5 billion in 2023 and $1.1 billion in 2022)	(2,449)		(2,311)
Net finance receivables, less unearned insurance premium and claim reserves and allowance for finance receivable losses	Net finance receivables, less unearned insurance premium and claim reserves and allowance for finance receivable losses	16,750		16,356		Net finance receivables, less unearned insurance premium and claim reserves and allowance for finance receivable losses	17,846		16,926

Restricted cash and restricted cash equivalents (includes restricted cash and restricted cash equivalents of consolidated VIEs of $472 million in 2022 and $466 million in 2021)		483		476
Restricted cash and restricted cash equivalents (includes restricted cash and restricted cash equivalents of consolidated VIEs of $564 million in 2023 and $442 million in 2022)						Restricted cash and restricted cash equivalents (includes restricted cash and restricted cash equivalents of consolidated VIEs of $564 million in 2023 and $442 million in 2022)	580		461
Goodwill	Goodwill	1,437		1,437		Goodwill	1,437		1,437
Other intangible assets	Other intangible assets	272		274		Other intangible assets	260		261

Other assets	Other assets	1,113		1,001		Other assets	1,196		1,152
Total assets	Total assets	$	22,314	$	22,046	Total assets	$	24,141	$	22,527

Liabilities and Shareholder’s Equity	Liabilities and Shareholder’s Equity					Liabilities and Shareholder’s Equity
Long-term debt (includes debt of consolidated VIEs of $9.2 billion in 2022 and $8.0 billion in 2021)		$	18,202	$	17,750
Long-term debt (includes debt of consolidated VIEs of $11.9 billion in 2023 and $9.4 billion in 2022)						Long-term debt (includes debt of consolidated VIEs of $11.9 billion in 2023 and $9.4 billion in 2022)	$	19,851	$	18,281
Insurance claims and policyholder liabilities	Insurance claims and policyholder liabilities	600		621		Insurance claims and policyholder liabilities	599		620
Deferred and accrued taxes	Deferred and accrued taxes	5		1		Deferred and accrued taxes	6		5
Other liabilities (includes other liabilities of consolidated VIEs of $18 million in 2022 and $13 million in 2021)		522		614
Other liabilities (includes other liabilities of consolidated VIEs of $26 million in 2023 and $20 million in 2022)						Other liabilities (includes other liabilities of consolidated VIEs of $26 million in 2023 and $20 million in 2022)	581		617
Total liabilities	Total liabilities	19,329		18,986		Total liabilities	21,037		19,523
Contingencies (Note 12)	Contingencies (Note 12)					Contingencies (Note 12)

Shareholder’s equity:	Shareholder’s equity:					Shareholder’s equity:
Common stock, par value $0.50 per share; 25,000,000 shares authorized, 10,160,021 shares issued and outstanding at September 30, 2022 and December 31, 2021		5		5
Common stock, par value $0.50 per share; 25,000,000 shares authorized, 10,160,021 shares issued and outstanding at September 30, 2023 and December 31, 2022						Common stock, par value $0.50 per share; 25,000,000 shares authorized, 10,160,021 shares issued and outstanding at September 30, 2023 and December 31, 2022	5		5
Additional paid-in capital	Additional paid-in capital	1,929		1,916		Additional paid-in capital	1,950		1,933
Accumulated other comprehensive income (loss)		(125)		61
Accumulated other comprehensive loss						Accumulated other comprehensive loss	(129)		(127)
Retained earnings	Retained earnings	1,176		1,078		Retained earnings	1,278		1,193

Total shareholder’s equity	Total shareholder’s equity	2,985		3,060		Total shareholder’s equity	3,104		3,004
Total liabilities and shareholder’s equity	Total liabilities and shareholder’s equity	$	22,314	$	22,046	Total liabilities and shareholder’s equity	$	24,141	$	22,527

See Notes to the Condensed Consolidated Financial Statements (Unaudited).

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ONEMAIN FINANCE CORPORATION AND SUBSIDIARIES

Condensed Consolidated Statements of Operations (Unaudited)


		Three Months Ended September 30,				Nine Months Ended September 30,
											Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in millions)	(dollars in millions)	2022		2021		2022		2021		(dollars in millions)	2023		2022		2023		2022

Interest income	Interest income	$	1,118	$	1,113	$	3,313	$	3,244	Interest income	$	1,167	$	1,118	$	3,377	$	3,313

Interest expense	Interest expense	223		237		661		703		Interest expense	267		223		749		661

Net interest income	Net interest income	895		876		2,652		2,541		Net interest income	900		895		2,628		2,652

Provision for finance receivable losses	Provision for finance receivable losses	421		226		998		356		Provision for finance receivable losses	410		421		1,275		998

Net interest income after provision for finance receivable losses	Net interest income after provision for finance receivable losses	474		650		1,654		2,185		Net interest income after provision for finance receivable losses	490		474		1,353		1,654

Other revenues:	Other revenues:									Other revenues:
Insurance	Insurance	111		109		334		323		Insurance	113		111		335		334
Investment	Investment	16		14		40		47		Investment	32		16		83		40

Gain on sales of finance receivables	Gain on sales of finance receivables	17		15		50		30		Gain on sales of finance receivables	11		17		42		50
Net gain (loss) on repurchases and repayments of debt	Net gain (loss) on repurchases and repayments of debt	2		(1)		(26)		(49)		Net gain (loss) on repurchases and repayments of debt	—		2		1		(26)

Other	Other	24		18		62		45		Other	29		24		87		62
Total other revenues	Total other revenues	170		155		460		396		Total other revenues	185		170		548		460

Other expenses:	Other expenses:									Other expenses:
Salaries and benefits	Salaries and benefits	212		229		621		613		Salaries and benefits	217		212		649		621
Other operating expenses	Other operating expenses	151		155		451		457		Other operating expenses	164		151		494		451
Insurance policy benefits and claims	Insurance policy benefits and claims	31		45		116		125		Insurance policy benefits and claims	48		35		139		119
Total other expenses	Total other expenses	394		429		1,188		1,195		Total other expenses	429		398		1,282		1,191

Income before income taxes	Income before income taxes	250		376		926		1,386		Income before income taxes	246		246		619		923

Income taxes	Income taxes	62		88		228		335		Income taxes	52		61		143		227

Net income	Net income	$	188	$	288	$	698	$	1,051	Net income	$	194	$	185	$	476	$	696

See Notes to the Condensed Consolidated Financial Statements (Unaudited).

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ONEMAIN FINANCE CORPORATION AND SUBSIDIARIES

Condensed Consolidated Statements of Comprehensive Income (Unaudited)


		Three Months Ended September 30,				Nine Months Ended September 30,					Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in millions)	(dollars in millions)	2022		2021		2022		2021		(dollars in millions)	2023		2022		2023		2022

Net income	Net income	$	188	$	288	$	698	$	1,051	Net income	$	194	$	185	$	476	$	696

Other comprehensive income (loss):
Other comprehensive loss:										Other comprehensive loss:
Net change in unrealized losses on non-credit impaired available-for-sale securities	Net change in unrealized losses on non-credit impaired available-for-sale securities	(65)		(9)		(248)		(34)		Net change in unrealized losses on non-credit impaired available-for-sale securities	(28)		(65)		(19)		(248)

Foreign currency translation adjustments	Foreign currency translation adjustments	(10)		(2)		(13)		1		Foreign currency translation adjustments	(4)		(10)		—		(13)

Changes in discount rate for insurance claims and policyholder liabilities										Changes in discount rate for insurance claims and policyholder liabilities	8		18		15		73
Other	Other	4		1		24		12		Other	4		4		2		24
Income tax effect:	Income tax effect:									Income tax effect:
Net change in unrealized gains on non-credit impaired available-for-sale securities		15		2		57		8
Net change in unrealized losses on non-credit impaired available-for-sale securities										Net change in unrealized losses on non-credit impaired available-for-sale securities	6		15		4		57

Foreign currency translation adjustments	Foreign currency translation adjustments	2		—		3		—		Foreign currency translation adjustments	1		2		—		3
Changes in discount rate for insurance claims and policyholder liabilities										Changes in discount rate for insurance claims and policyholder liabilities	(1)		(4)		(3)		(16)
Other	Other	(1)		—		(6)		(3)		Other	(1)		(1)		(1)		(6)
Other comprehensive loss, net of tax, before reclassification adjustments	Other comprehensive loss, net of tax, before reclassification adjustments	(55)		(8)		(183)		(16)		Other comprehensive loss, net of tax, before reclassification adjustments	(15)		(41)		(2)		(126)
Reclassification adjustments included in net income, net of tax:	Reclassification adjustments included in net income, net of tax:									Reclassification adjustments included in net income, net of tax:
Net realized losses on available-for-sale securities, net of tax	Net realized losses on available-for-sale securities, net of tax	—		—		(3)		(1)		Net realized losses on available-for-sale securities, net of tax	—		—		—		(3)
Reclassification adjustments included in net income, net of tax	Reclassification adjustments included in net income, net of tax	—		—		(3)		(1)		Reclassification adjustments included in net income, net of tax	—		—		—		(3)
Other comprehensive loss, net of tax	Other comprehensive loss, net of tax	(55)		(8)		(186)		(17)		Other comprehensive loss, net of tax	(15)		(41)		(2)		(129)

Comprehensive income	Comprehensive income	$	133	$	280	$	512	$	1,034	Comprehensive income	$	179	$	144	$	474	$	567

See Notes to the Condensed Consolidated Financial Statements (Unaudited).

Table of Contents

ONEMAIN FINANCE CORPORATION AND SUBSIDIARIES

Condensed Consolidated Statements of Shareholder’s Equity (Unaudited)


		OneMain Finance Corporation Shareholder's Equity										OneMain Finance Corporation Shareholder's Equity
(dollars in millions)	(dollars in millions)	Common Stock		Additional Paid-in Capital		Accumulated Other Comprehensive Income (Loss)		Retained Earnings		Total Shareholder’s Equity			(dollars in millions)	Common Stock		Additional Paid-in Capital		Accumulated Other Comprehensive Income (Loss)		Retained Earnings		Total Shareholder’s Equity

Three Months Ended September 30, 2023													Three Months Ended September 30, 2023

Balance, July 1, 2023													Balance, July 1, 2023	$	5	$	1,946	$	(114)	$	1,204	$	3,041
Share-based compensation expense, net of forfeitures													Share-based compensation expense, net of forfeitures	—		6		—		—		6
Withholding tax on share-based compensation													Withholding tax on share-based compensation	—		(2)		—		—		(2)
Other comprehensive loss													Other comprehensive loss	—		—		(15)		—		(15)
Cash dividends													Cash dividends	—		—		—		(120)		(120)
Net income													Net income	—		—		—		194		194
Balance, September 30, 2023													Balance, September 30, 2023	$	5	$	1,950	$	(129)	$	1,278	$	3,104

Three Months Ended September 30, 2022	Three Months Ended September 30, 2022												Three Months Ended September 30, 2022
Balance, July 1, 2022	Balance, July 1, 2022	$	5	$	1,923	$	(70)	$	1,165	$	3,023		Balance, July 1, 2022	$	5	$	1,923	$	(83)	$	1,166	$	3,011

Share-based compensation expense, net of forfeitures	Share-based compensation expense, net of forfeitures	—		8		—		—		8			Share-based compensation expense, net of forfeitures	—		8		—		—		8
Withholding tax on share-based compensation	Withholding tax on share-based compensation	—		(2)		—		—		(2)			Withholding tax on share-based compensation	—		(2)		—		—		(2)
Other comprehensive loss	Other comprehensive loss	—		—		(55)		—		(55)			Other comprehensive loss	—		—		(41)		—		(41)
Cash dividends	Cash dividends	—		—		—		(177)		(177)			Cash dividends	—		—		—		(177)		(177)
Net income	Net income	—		—		—		188		188			Net income	—		—		—		185		185
Balance, September 30, 2022	Balance, September 30, 2022	$	5	$	1,929	$	(125)	$	1,176	$	2,985		Balance, September 30, 2022	$	5	$	1,929	$	(124)	$	1,174	$	2,984

Three Months Ended September 30, 2021
Balance, July 1, 2021		$	5	$	1,905	$	85	$	1,535	$	3,530

Share-based compensation expense, net of forfeitures		—		4		—		—		4

Other comprehensive loss		—		—		(8)		—		(8)
Cash dividends		—		—		—		(718)		(718)
Net income		—		—		—		288		288
Balance, September 30, 2021		$	5	$	1,909	$	77	$	1,105	$	3,096

Nine Months Ended September 30, 2022
Balance, January 1, 2022		$	5	$	1,916	$	61	$	1,078	$	3,060

Share-based compensation expense, net of forfeitures		—		27		—		—		27
Withholding tax on share-based compensation		—		(14)		—		—		(14)
Other comprehensive loss		—		—		(186)		—		(186)
Cash dividends		—		—		—		(600)		(600)
Net income		—		—		—		698		698
Balance, September 30, 2022		$	5	$	1,929	$	(125)	$	1,176	$	2,985

Nine Months Ended September 30, 2021
Balance, January 1, 2021		$	5	$	1,899	$	94	$	1,442	$	3,440

Share-based compensation expense, net of forfeitures		—		16		—		—		16
Withholding tax on shared-based compensation		—		(6)		—		—		(6)
Other comprehensive loss		—		—		(17)		—		(17)
Cash dividends		—		—		—		(1,388)		(1,388)
Net income		—		—		—		1,051		1,051
Balance, September 30, 2021		$	5	$	1,909	$	77	$	1,105	$	3,096

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ONEMAIN FINANCE CORPORATION AND SUBSIDIARIES
Condensed Consolidated Statements of Shareholder’s Equity (Unaudited)

	OneMain Finance Corporation Shareholder’s Equity
(dollars in millions)	Common Stock		Additional Paid-in Capital		Accumulated Other Comprehensive Income (Loss)		Retained Earnings		Total Shareholders’ Equity

Nine Months Ended September 30, 2023
Balance, January 1, 2023	$	5	$	1,933	$	(127)	$	1,193	$	3,004
Net impact of adoption of ASU 2022-02 (see Note 2)	—		—		—		12		12
Balance, January 1, 2023 (post-adoption)	5		1,933		(127)		1,205		3,016
Share-based compensation expense, net of forfeitures	—		27		—		—		27
Withholding tax on share-based compensation	—		(10)		—		—		(10)
Other comprehensive loss	—		—		(2)		—		(2)
Cash dividends	—		—		—		(403)		(403)
Net income	—		—		—		476		476
Balance, September 30, 2023	$	5	$	1,950	$	(129)	$	1,278	$	3,104

Nine Months Ended September 30, 2022
Balance, January 1, 2022	$	5	$	1,916	$	5	$	1,078	$	3,004
Share-based compensation expense, net of forfeitures	—		27		—		—		27
Withholding tax on shared-based compensation	—		(14)		—		—		(14)
Other comprehensive loss	—		—		(129)		—		(129)
Cash dividends	—		—		—		(600)		(600)
Net income	—		—		—		696		696
Balance, September 30, 2022	$	5	$	1,929	$	(124)	$	1,174	$	2,984

See Notes to the Condensed Consolidated Financial Statements (Unaudited).

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ONEMAIN FINANCE CORPORATION AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows (Unaudited)


		Nine Months Ended September 30,
							Nine Months Ended September 30,
(dollars in millions)	(dollars in millions)	2022		2021		(dollars in millions)	2023		2022

Cash flows from operating activities	Cash flows from operating activities					Cash flows from operating activities
Net income	Net income	$	698	$	1,051	Net income	$	476	$	696
Reconciling adjustments:	Reconciling adjustments:					Reconciling adjustments:
Provision for finance receivable losses	Provision for finance receivable losses	998		356		Provision for finance receivable losses	1,275		998
Depreciation and amortization	Depreciation and amortization	188		197		Depreciation and amortization	191		188
Deferred income tax charge (benefit)		(44)		57
Net loss on repurchases and repayments of debt		26		49
Deferred income tax benefit						Deferred income tax benefit	(30)		(45)
Net loss (gain) on repurchases and repayments of debt						Net loss (gain) on repurchases and repayments of debt	(1)		26
Share-based compensation expense, net of forfeitures	Share-based compensation expense, net of forfeitures	27		16		Share-based compensation expense, net of forfeitures	27		27
Gain on sales of finance receivables	Gain on sales of finance receivables	(50)		(30)		Gain on sales of finance receivables	(42)		(50)
Other	Other	4		(4)		Other	(1)		4
Cash flows due to changes in other assets and other liabilities	Cash flows due to changes in other assets and other liabilities	(124)		(50)		Cash flows due to changes in other assets and other liabilities	(55)		(121)
Net cash provided by operating activities	Net cash provided by operating activities	1,723		1,642		Net cash provided by operating activities	1,840		1,723

Cash flows from investing activities	Cash flows from investing activities					Cash flows from investing activities
Net principal originations and purchases of finance receivables	Net principal originations and purchases of finance receivables	(2,010)		(1,738)		Net principal originations and purchases of finance receivables	(2,726)		(2,010)

Proceeds from sales of finance receivables	Proceeds from sales of finance receivables	599		361		Proceeds from sales of finance receivables	493		599
Available-for-sale securities purchased	Available-for-sale securities purchased	(406)		(347)		Available-for-sale securities purchased	(129)		(406)
Available-for-sale securities called, sold, and matured	Available-for-sale securities called, sold, and matured	370		294		Available-for-sale securities called, sold, and matured	274		370
Other securities purchased	Other securities purchased	(5)		(706)		Other securities purchased	(4)		(5)
Other securities called, sold, and matured	Other securities called, sold, and matured	11		691		Other securities called, sold, and matured	5		11
Other, net	Other, net	(56)		(53)		Other, net	(65)		(56)
Net cash used for investing activities	Net cash used for investing activities	(1,497)		(1,498)		Net cash used for investing activities	(2,152)		(1,497)

Cash flows from financing activities	Cash flows from financing activities					Cash flows from financing activities
Proceeds from issuance and borrowings of long-term debt, net of issuance costs	Proceeds from issuance and borrowings of long-term debt, net of issuance costs	4,479		2,168		Proceeds from issuance and borrowings of long-term debt, net of issuance costs	3,743		4,479
Repayments and repurchases of long-term debt	Repayments and repurchases of long-term debt	(4,080)		(2,384)		Repayments and repurchases of long-term debt	(2,202)		(4,080)
Cash dividends	Cash dividends	(602)		(1,388)		Cash dividends	(403)		(602)
Withholding tax on share-based compensation	Withholding tax on share-based compensation	(14)		(6)		Withholding tax on share-based compensation	(10)		(14)
Net cash used for financing activities		(217)		(1,610)
Net cash provided by (used for) financing activities						Net cash provided by (used for) financing activities	1,128		(217)

Net change in cash and cash equivalents and restricted cash and restricted cash equivalents	Net change in cash and cash equivalents and restricted cash and restricted cash equivalents	9		(1,466)		Net change in cash and cash equivalents and restricted cash and restricted cash equivalents	816		9
Cash and cash equivalents and restricted cash and restricted cash equivalents at beginning of period	Cash and cash equivalents and restricted cash and restricted cash equivalents at beginning of period	986		2,723		Cash and cash equivalents and restricted cash and restricted cash equivalents at beginning of period	951		986
Cash and cash equivalents and restricted cash and restricted cash equivalents at end of period	Cash and cash equivalents and restricted cash and restricted cash equivalents at end of period	$	995	$	1,257	Cash and cash equivalents and restricted cash and restricted cash equivalents at end of period	$	1,767	$	995

Supplemental cash flow information	Supplemental cash flow information					Supplemental cash flow information
Cash and cash equivalents	Cash and cash equivalents	$	512	$	798	Cash and cash equivalents	$	1,187	$	512
Restricted cash and restricted cash equivalents	Restricted cash and restricted cash equivalents	483		459		Restricted cash and restricted cash equivalents	580		483
Total cash and cash equivalents and restricted cash and restricted cash equivalents	Total cash and cash equivalents and restricted cash and restricted cash equivalents	$	995	$	1,257	Total cash and cash equivalents and restricted cash and restricted cash equivalents	$	1,767	$	995

Restricted cash and restricted cash equivalents primarily represent funds required to be used for future debt payments relating to our secured transactions.

See Notes to the Condensed Consolidated Financial Statements (Unaudited).

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ONEMAIN HOLDINGS, INC. AND SUBSIDIARIES

Notes to the Condensed Consolidated Financial Statements

September 30, ~~2022~~2023


1. Business and Basis of Presentation

OneMain Holdings, Inc. (“OMH”), and its wholly owned direct subsidiary, OneMain Finance Corporation (“OMFC”) are financial services holding companies whose subsidiaries engage in the consumer finance and insurance businesses.

The results of OMFC are consolidated into the results of OMH. Due to the nominal differences between OMFC and OMH, content throughout this filing relates to both OMH and OMFC, except where otherwise indicated. OMH and OMFC are referred to in this report, collectively with their subsidiaries, whether directly or indirectly owned, as “the Company,” “OneMain,” “we,” “us,” or “our.”

BASIS OF PRESENTATION

We prepared our condensed consolidated financial statements using generally accepted accounting principles in the United States of America (“GAAP”). These statements are unaudited. The year-end condensed balance sheet data was derived from our audited financial statements but does not include all disclosures required by GAAP. The statements include the accounts of OMH, its subsidiaries (all of which are wholly owned), and variable interest entities (“VIEs”) in which we hold a controlling financial interest and for which we are considered to be the primary beneficiary as of the financial statement date.

We eliminated all material intercompany accounts and transactions. We made judgments, estimates, and assumptions that affect amounts reported in our condensed consolidated financial statements and disclosures of contingent assets and liabilities. In management’s opinion, the condensed consolidated financial statements include the normal, recurring adjustments necessary for a fair statement of results. Actual results could differ from our estimates. We evaluated the effects of and the need to disclose events that occurred subsequent to the balance sheet date.

The condensed consolidated financial statements in this report should be read in conjunction with the consolidated financial statements and related notes included in our Annual Report. We follow the same significant accounting policies for our interim ~~reporting.~~reporting except for the new accounting pronouncements subsequently adopted and disclosed in Note 2. To conform to the ~~2022~~2023 presentation, we reclassified certain items in prior periods of our condensed consolidated financial statements.

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2. Recent Accounting Pronouncements

ACCOUNTING PRONOUNCEMENTS ~~TO BE~~RECENTLY ADOPTED

Insurance

In August of 2018, the FASB issued ASU 2018-12, Financial Services - Insurance: Targeted Improvements to the Accounting for Long-Duration Contracts, which provides targeted improvements to Topic 944 for the assumptions used to measure the liability for future policy benefits for nonparticipating traditional and limited-payment contracts; measurement of market risk benefits; amortization of deferred acquisition costs; and enhanced disclosures. ~~Upon adoption, our~~The ASU requires the assumptions used to measure the liability for future policy benefits ~~will~~to be updated at least annually. The guidance ~~requires~~prescribes the discount rate used to measure the liability to be an upper-medium grade fixed-income instrument yield and updated at each reporting date with changes in the liability due to the discount rate recognized in other comprehensive income.

The amendments in this ASU ~~become~~became effective for the Company beginning January 1, 2023 and we ~~have selected~~adopted using the modified retrospective transition ~~method, which requires~~method. This ASU required a transition date of January 1, ~~2021.~~2021 and resulted in recasting prior periods.

The effects of the adoption of ASU 2018-12 to our condensed consolidated balance sheets were as follows:


(dollars in millions)	As Reported		ASU 2018-12 Adjustment		As Recast

December 31, 2022
Other assets (OMH only)	$	1,150	$	4	$	1,154
Other assets (OMFC only)	1,148		4		1,152
Insurance claims and policyholder liabilities	602		18		620
Accumulated other comprehensive loss	(119)		(8)		(127)
Retained earnings (OMH only)	2,125		(6)		2,119
Retained earnings (OMFC only)	1,199		(6)		1,193

September 30, 2022


Insurance claims and policyholder liabilities	$	600	$	1	$	601
Accumulated other comprehensive loss	(125)		1		(124)
Retained earnings (OMH only)	2,063		(2)		2,061
Retained earnings (OMFC only)	1,176		(2)		1,174

December 31, 2021
Other assets (OMH only)	$	1,003	$	16	$	1,019
Other assets (OMFC only)	1,001		16		1,017
Insurance claims and policyholder liabilities	621		72		693
Accumulated other comprehensive income	61		(56)		5



January 1, 2021
Other assets (OMH and OMFC)	$	1,054	$	21	$	1,075

Insurance claims and policyholder liabilities	621		97		718
Accumulated other comprehensive income	94		(76)		18

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The effects of the adoption of ASU 2018-12 to our condensed consolidated statements of operations were as follows:


(dollars in millions, except per share amounts)	As Reported		ASU 2018-12 Adjustment		As Recast

Three Months Ended September 30, 2022
Insurance policy benefits and claims	$	31	$	4	$	35
Income before income taxes	250		(4)		246
Income taxes	62		(1)		61
Net income	188		(3)		185
Basic EPS (OMH only)	1.52		(0.02)		1.50
Diluted EPS (OMH only)	1.52		(0.03)		1.49

Nine Months Ended September 30, 2022
Insurance policy benefits and claims	$	116	$	3	$	119
Income before income taxes	926		(3)		923
Income taxes	228		(1)		227
Net income	698		(2)		696
Basic EPS (OMH only)	5.58		(0.02)		5.56
Diluted EPS (OMH only)	5.57		(0.02)		5.55

The Company’s cross-functional implementation team continues to make progress in line with the established project plan to ensure we comply with all the amendments in this ASU at the time of adoption. The Company’s long-duration contracts include whole life, term life, accidental death and dismemberment, and disability income protection. We are utilizing an actuarial software solution to meet the new accounting and disclosure requirements and continue to refine the development of the actuarial model and assumptions. After the model has been subject to a parallel testing phase in 2022, the Company will provide further disclosure regarding the estimated impacteffects of the adoption of ASU 2018-12 to our condensed consolidated statements of comprehensive income were as follows:


(dollars in millions)	As Reported		ASU 2018-12 Adjustment		As Recast

Three Months Ended September 30, 2022
Comprehensive income	$	133	$	11	$	144

Nine Months Ended September 30, 2022
Comprehensive income	$	512	$	55	$	567

The effects of the adoption of ASU on2018-12 to our condensed consolidated ~~financial statements. At~~statements of cash flows were as follows:


(dollars in millions)	As Reported		ASU 2018-12 Adjustment		As Recast

Nine Months Ended September 30, 2022
Net income	$	698	$	(2)	$	696
Deferred income tax charge	(44)		(1)		(45)
Cash flows due to changes in other assets and other liabilities	(124)		3		(121)

As a result of the adoption of ASU 2018-12, our significant accounting policy related to long-duration insurance contracts for policy and claim reserves has changed to reflect the requirements of the new standard. See below for the updated significant accounting policy as of the transition date of January 1, 2021.

Policy and Claim Reserves

Policy reserves are established for our long-duration contracts. The liability for future policy benefits is the present value of estimated future policy benefits to be paid to or on behalf of policyholders less the present value of estimated future net premiums to be collected from policyholders. To estimate the liability, we ~~expect this ASU will result in an increase to insurance claims~~make assumptions for mortality, morbidity, lapses, and ~~policyholder liabilities that will primarily be driven by~~ the ~~remeasured~~discount rate.

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At least annually, we update our estimate of the liability with actual experience and review our cash flow assumptions. The updated liability is discounted at the original discount rate ~~resulting~~at contract inception, and the change in the balance is recognized as a ~~reduction~~remeasurement gain or loss and included in Insurance policy benefits and claims in our consolidated statements of operations.

The discount rate assumption is the equivalent of an upper-medium grade fixed-income instrument yield. To determine the original discount rate at contract inception, we use a weighted average rate based on a forward yield curve over the contract issue year. At each reporting period, the liability is remeasured using the current discount rate and the change in the liability due to ~~accumulated~~the discount rate is recognized in Accumulated other comprehensive income ~~net of tax. We expect this impact would reverse over the transition period as interest rates continue to rise. We expect the impact to retained earnings to be immaterial.~~(loss) in our consolidated balance sheets.

Financial Instruments

In March of 2022, the FASB issued ASU 2022-02, Financial Instruments - Credit Losses: Troubled Debt Restructurings and Vintage Disclosures, which eliminates the accounting for troubled debt restructurings by creditors while enhancing the disclosure requirements for certain loan refinancings and restructurings by creditors when a borrower is experiencing financial difficulty. The amendment also requires disclosure of gross charge-offs by year of origination for finance receivables. The amendments in this ASU are effective for the Company for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted. Management will adopt this ASU using the modified retrospective method effective January 1, 2023. We are currently evaluating whether adoption of this ASU will have a material impact on our consolidated financial statements.

We ~~do not believe that any other accounting pronouncements issued, but not yet effective, would have~~adopted the amendments in this ASU as of January 1, 2023 using the modified retrospective transition method.

Upon adoption, we recorded a ~~material impact on~~decrease to the allowance for finance receivable losses of $16 million, a decrease to deferred tax assets of $4 million and a one-time corresponding cumulative increase to retained earnings, net of tax, of $12 million in our consolidated balance sheets as of January 1, 2023.

As a result of the adoption of ASU 2022-02, several of our significant accounting policies have changed to reflect the requirements of the new standard. See below for the updated significant accounting policies as of January 1, 2023.

Troubled Debt Restructured Finance Receivables

ASU 2022-02 superseded the accounting for troubled debt restructurings by creditors. As a result of the adoption of this ASU, the accounting for TDRs is no longer applicable for periods beginning on or after January 1, 2023.

Modified Finance Receivables to Borrowers Experiencing Financial Difficulty

We make modifications to our finance receivables to assist borrowers who are experiencing financial ~~statements~~difficulty, participating in a counseling or ~~disclosures,~~settlement arrangement, or are in bankruptcy. When we modify the contractual terms for economic or other reasons related to the borrower’s financial difficulties, we classify that receivable as a modified finance receivable. We restructure finance receivables only if ~~adopted.~~we believe the customer has the ability to pay under the restructured terms for the foreseeable future.

When we modify an account, we primarily use a combination of the following to reduce the borrower’s monthly payment: reduce the interest rate, extend the term, defer or forgive past due interest, or forgive principal. As part of the modification, we may require qualifying payments before the accounts are generally brought current for delinquency reporting. In addition, for principal forgiveness, we may require future payment performance by the borrower under the modified terms before the balances are contractually forgiven. We fully reserve for any potential principal forgiveness in our allowance for finance receivable losses.

Account modifications that are deemed to be a modified finance receivable are measured for impairment in accordance with our policy for allowance for finance receivable losses.

Allowance for Finance Receivable Losses

We establish the allowance for finance receivable losses through the provision for finance receivable losses. We evaluate our finance receivable portfolio by level of contractual delinquency in the portfolio, specifically in the late-stage delinquency buckets and inclusive of the migration of the loans through the delinquency buckets. Our finance receivables consist of a large number of relatively small, homogeneous accounts. We evaluate our finance receivables for impairment as pools. None of our accounts are large enough to warrant individual evaluation for impairment.

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We estimate the allowance for finance receivable losses primarily on historical loss experience using a cumulative loss model applied to our personal loan portfolios. Our gross credit loss expectation is offset by the estimate of future recoveries using historical recovery curves. Our personal loans are primarily segmented in the loss model by contractual delinquency status.

Other attributes in the model include loan modification status, collateral mix and recent credit score. To estimate the gross credit losses, the model utilizes a roll rate matrix to project the first 12 months of losses and historical cohort performance to project the expected losses over the remaining term. Our methodology relies on historical loss experience to forecast the corresponding future outcomes. These patterns are then applied to the current portfolio to obtain an estimate of future losses. We also consider key economic trends including unemployment rates. Forecasted macroeconomic conditions extend to our reasonable and supportable forecast period and revert to a historical average. No new volume is assumed. Personal loan renewals are a significant piece of our new volume and are considered a terminal event of the previous loan.

For our personal loans, we have elected not to measure an allowance on accrued finance charges as it is our policy to reverse finance charge amounts previously accrued after four contractual payments become past due. For credit cards, we measure an allowance on uncollected finance charges, but do not measure an allowance on the unfunded portion of the credit card lines as the accounts are unconditionally cancellable.

Management exercises its judgment when determining the amount of allowance for finance receivable losses. Our judgment is based on quantitative analyses, qualitative factors (such as recent portfolio, industry, and other economic trends), and experience in the consumer finance industry. We adjust the amounts determined by our model for management’s estimate of the effects of model imprecision which include but are not limited to, any changes to underwriting criteria and portfolio seasoning.

We generally charge off to the allowance for finance receivable losses on personal loans and credit cards that are beyond seven payments (approximately 180 days) past due. Exceptions include accounts in bankruptcy, which are generally charged off at the earlier of notice of discharge or when the customer becomes seven payments past due, and accounts of deceased borrowers, which are generally charged off at the time of notice. Generally, we start repossession of any titled personal property when the customer becomes two payments (approximately 30 days) past due and may charge off prior to the account becoming seven payments (approximately 180 days) past due.

We may renew delinquent secured or unsecured personal loan accounts if the customer meets current underwriting criteria and it does not appear that the cause of past delinquency will affect the customer’s ability to repay the renewed loan. We subject all renewals to the same credit risk underwriting process as we would a new application for credit.

See Notes 3 and 4 for additional information on the adoption of ASU 2022-02.

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3. Finance Receivables

Our finance receivables consist of personal loans and credit cards. Personal loans are non-revolving, with a fixed rate, have fixed terms generally between three and six years, and are secured by automobiles, other titled collateral, or are unsecured. ~~During the third quarter of 2021, we began offering credit cards.~~ Credit cards are open-ended, revolving, with a fixed rate, and are unsecured.

Components of our net finance receivables were as follows:


(dollars in millions)	(dollars in millions)	Personal Loans		Credit Cards		Total		(dollars in millions)	Personal Loans		Credit Cards		Total

September 30, 2022
Gross finance receivables (a)		$	19,428	$	79	$	19,507
September 30, 2023								September 30, 2023
Gross finance receivables *								Gross finance receivables *	$	20,564	$	226	$	20,790
Unearned fees	Unearned fees	(223)		—		(223)		Unearned fees	(233)		—		(233)
Accrued finance charges and fees	Accrued finance charges and fees	280		—		280		Accrued finance charges and fees	303		—		303
Deferred origination costs	Deferred origination costs	188		—		188		Deferred origination costs	201		6		207
Total	Total	$	19,673	$	79	$	19,752	Total	$	20,835	$	232	$	21,067

December 31, 2021
Gross finance receivables (a)		$	18,944	$	24	$	18,968
December 31, 2022								December 31, 2022
Gross finance receivables *								Gross finance receivables *	$	19,615	$	107	$	19,722
Unearned fees	Unearned fees	(225)		(1)		(226)		Unearned fees	(220)		—		(220)
Accrued finance charges and fees	Accrued finance charges and fees	289		—		289		Accrued finance charges and fees	299		—		299
Deferred origination costs	Deferred origination costs	179		2		181		Deferred origination costs	185		—		185
Total	Total	$	19,187	$	25	$	19,212	Total	$	19,879	$	107	$	19,986

~~(a)~~* Personal loan gross finance receivables equal the unpaid principal balance. For precompute personal loans, unpaid principal balance is the gross contractual payments less the unaccreted balance of unearned finance charges. Credit card gross finance receivables equal the principal balance and billed interest and fees.

WHOLE LOAN SALE TRANSACTIONS

~~As of September 30, 2022, we~~We have whole loan sale flow agreements with third parties, with remaining terms of less than one year, in which we agreed to sell a combined total of ~~$180~~$135 million gross receivables per quarter of newly originated unsecured personal loans along with any associated accrued interest. These unsecured personal loans are derecognized from our balance sheet at the time of sale. We service the personal loans sold and are entitled to a servicing fee and other fees commensurate with the services performed as part of the agreements. The gain on sales and servicing fees are recorded in ~~other revenue.~~Other revenues in our condensed consolidated statements of operations. We sold $135 million and $450 million of gross finance receivables during the three and nine months ended September 30, 2023, respectively, and $180 million and $540 million of gross finance receivables during the three and nine months ended September 30, 2022, ~~respectively, and $160~~respectively. The gain on the sales were $11 million and ~~$325~~$42 million ~~of gross finance receivables~~ during the three and nine months ended September 30, ~~2021, respectively. The gain on the sales were~~2023, respectively, and $17 million and $50 million during the three and nine months ended September 30, 2022, ~~respectively, and $15 million and $30 million during the three and nine months ended September 30, 2021,~~ respectively.

CREDIT QUALITY INDICATOR

We consider the delinquency status of our finance receivables as our key credit quality indicator. We monitor the delinquency of our finance receivable portfolio, including the migration between the delinquency buckets and changes in the delinquency trends to manage our exposure to credit risk in the portfolio.

When personal loans are 60 days contractually past due, we consider these accounts to be at an increased risk for loss and move collection of these accounts ~~is managed by~~to our ~~centralized~~central collection operations. We consider our personal loans to be nonperforming at 90 days or more contractually past due, at which point we stop accruing finance charges and reverse finance charges previously accrued. For our personal loans, we reversed net accrued finance charges of $36 million and $105 million during the three and nine months ended September 30, 2023, respectively, and $34 million and $88 million during the three and nine months ended September 30, 2022, ~~respectively, and $18 million and $52 million during the three and nine months ended September 30, 2021,~~ respectively.

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Finance charges recognized from the contractual interest portion of payments received on nonaccrual personal loans totaled $4 million and $14 million during the three and nine months ended September 30, 2023, respectively, and $4 million and $12 million during the three and nine months ended September 30, 2022, ~~respectively, and $2 million and $10 million during the three and nine months ended September 30, 2021,~~ respectively. All personal loans in nonaccrual status are considered in our estimate of allowance for finance receivable losses.

We accrue finance charges and fees on credit cards until charge-off at approximately 180 days past due, at which point we reverse finance charges and fees previously accrued. For credit cards, net accrued finance charges and fees reversed ~~for~~totaled $3 million and $8 million during the three and nine months ended September 30, ~~2022~~2023, respectively, and ~~2021~~ were ~~immaterial.~~immaterial during the three and nine months ended September 30, 2022.

The following tables below are a summary of our personal loans by the year of origination and number of days delinquent:


(dollars in millions)	(dollars in millions)	2022		2021		2020		2019		2018		Prior		Total		(dollars in millions)	2023		2022		2021		2020		2019		Prior		Total

September 30, 2022
September 30, 2023																September 30, 2023
Performing	Performing															Performing
Current	Current	$	8,627	$	6,034	$	2,151	$	1,365	$	336	$	133	$	18,646	Current	$	8,394	$	6,692	$	2,967	$	970	$	507	$	149	$	19,679
30-59 days past due	30-59 days past due	88		143		47		32		10		6		326		30-59 days past due	69		159		92		27		17		7		371
60-89 days past due	60-89 days past due	54		108		34		21		6		4		227		60-89 days past due	41		113		64		18		10		4		250
Total performing	Total performing	8,769		6,285		2,232		1,418		352		143		19,199		Total performing	8,504		6,964		3,123		1,015		534		160		20,300
Nonperforming (Nonaccrual)	Nonperforming (Nonaccrual)															Nonperforming (Nonaccrual)
90+ days past due	90+ days past due	63		258		84		48		14		7		474		90+ days past due	53		256		151		42		24		9		535

Total	Total	$	8,832	$	6,543	$	2,316	$	1,466	$	366	$	150	$	19,673	Total	$	8,557	$	7,220	$	3,274	$	1,057	$	558	$	169	$	20,835

Gross charge-offs																Gross charge-offs	$	13	$	527	$	501	$	147	$	81	$	33	$	1,302


(dollars in millions)	(dollars in millions)	2021		2020		2019		2018		2017		Prior		Total		(dollars in millions)	2022		2021		2020		2019		2018		Prior		Total

December 31, 2021
December 31, 2022																December 31, 2022
Performing	Performing															Performing
Current	Current	$	10,645	$	3,935	$	2,641	$	814	$	193	$	109	$	18,337	Current	$	10,614	$	4,927	$	1,758	$	1,081	$	240	$	105	$	18,725
30-59 days past due	30-59 days past due	125		74		53		19		6		5		282		30-59 days past due	136		136		43		28		9		5		357
60-89 days past due	60-89 days past due	81		53		33		11		4		3		185		60-89 days past due	92		101		32		19		6		3		253
Total performing	Total performing	10,851		4,062		2,727		844		203		117		18,804		Total performing	10,842		5,164		1,833		1,128		255		113		19,335
Nonperforming (Nonaccrual)	Nonperforming (Nonaccrual)															Nonperforming (Nonaccrual)
90+ days past due	90+ days past due	125		130		85		28		9		6		383		90+ days past due	160		246		74		44		13		7		544

Total	Total	$	10,976	$	4,192	$	2,812	$	872	$	212	$	123	$	19,187	Total	$	11,002	$	5,410	$	1,907	$	1,172	$	268	$	120	$	19,879

The following is a summary of credit cards by number of days delinquent:


(dollars in millions)	(dollars in millions)	September 30, 2022		December 31, 2021		(dollars in millions)	September 30, 2023		December 31, 2022

Current	Current	$	69	$	25	Current	$	211	$	93
30-59 days past due	30-59 days past due	3		—		30-59 days past due	6		3
60-89 days past due	60-89 days past due	2		—		60-89 days past due	5		3
90+ days past due	90+ days past due	5		—		90+ days past due	10		8

Total	Total	$	79	$	25	Total	$	232	$	107

There were no credit cards that were converted to term loans at September 30, ~~2022~~2023 or December 31, ~~2021.~~2022.

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MODIFIED FINANCE RECEIVABLES TO BORROWERS EXPERIENCING FINANCIAL DIFFICULTY

We make modifications to our finance receivables to assist borrowers who are experiencing financial difficulty and when we modify the contractual terms for economic or other reasons related to the borrower’s financial difficulties, we classify that receivable as a modified finance receivable. The following tables below represent information regarding modified finance receivables to borrowers experiencing financial difficulty on or after January 1, 2023, the effective date of ASU 2022-02.

The period-end carrying value of finance receivables modified during the period were as follows:





(dollars in millions)	Three Months Ended September 30, 2023			Nine Months Ended September 30, 2023


Interest rate reduction and term extension	$	143		$	378
Interest rate reduction and principal forgiveness	101			260


Total modifications to borrowers experiencing financial difficulties	$	244		$	638






Modifications as a percent of net finance receivables - personal loans	1.17		%	3.06		%

The financial effect of loan modifications made during the period were as follows:


(dollars in millions)	Three Months Ended September 30, 2023			Nine Months Ended September 30, 2023


Weighted-average interest rate reduction	19.15		%		20.01		%
Weighted-average term extension (months)	27				24
Principal/interest forgiveness	$	12			$	32

The performance of modified finance receivables by delinquency status was as follows:


(dollars in millions)	September 30, 2023


Current	$	465
30-59 days past due	54
60-89 days past due	42
90+ days past due	77
Total*	$	638

* Excludes $33 million of modified finance receivables that subsequently charged off.

The period-end carrying value of modified finance receivables for which there was a default during the period to cause the modified finance receivable to be considered nonperforming (90 days or more past due) were as follows:


(dollars in millions)	Three Months Ended September 30, 2023		Nine Months Ended September 30, 2023





Interest rate reduction and term extension	$	35	$	47
Interest rate reduction and principal forgiveness	10		12


Total	$	45	$	59

See Notes 2 and 4 for additional information on the adoption of ASU 2022-02.

Table of Contents

TROUBLED DEBT RESTRUCTURED FINANCE RECEIVABLES PRIOR TO ADOPTION OF ASU 2022-02

ASU 2022-02 superseded the accounting for troubled debt restructurings by creditors. Due to the adoption of this ASU, the following disclosures related to troubled debt restructuring finance receivables are no longer applicable for reporting periods beginning in 2023.

Information regarding TDR finance receivables were as follows:

(dollars in millions) September 30, 2022 December 31, 2021

TDR gross finance receivables $ 797 $ 646
TDR net finance receivables * 802 650
Allowance for TDR finance receivable losses 307 270



(dollars in millions)	December 31, 2022


TDR gross finance receivables	$	898
TDR net finance receivables *	904
Allowance for TDR finance receivable losses	369

* TDR net finance receivables are TDR gross finance receivables net of unearned fees, accrued finance charges, and deferred origination costs.

There were no credit cards classified as TDR finance receivables at ~~September 30, 2022 or~~ December 31, ~~2021.~~2022.

Information regarding the new volume of the TDR finance receivables were as follows:


		Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in millions)	(dollars in millions)	2022		2021		2022		2021		(dollars in millions)	Three Months Ended September 30, 2022		Nine Months Ended September 30, 2022

Pre-modification TDR net finance receivables	Pre-modification TDR net finance receivables	$	245	$	105	$	521	$	332	Pre-modification TDR net finance receivables	$	245	$	521
Post-modification TDR net finance receivables:	Post-modification TDR net finance receivables:									Post-modification TDR net finance receivables:
Rate reduction	Rate reduction	172		72		342		228		Rate reduction	172		342
Other *	Other *	73		33		179		104		Other *	73		179
Total post-modification TDR net finance receivables	Total post-modification TDR net finance receivables	$	245	$	105	$	521	$	332	Total post-modification TDR net finance receivables	$	245	$	521
Number of TDR accounts	Number of TDR accounts	29,448		12,528		63,129		40,727		Number of TDR accounts	29,448		63,129

* “Other” modifications primarily consist of loans with both rate reductions and the potential of principal forgiveness contingent on future payment performance by the borrower under the modified terms.

Finance receivables that were modified as TDR finance receivables within the previous 12 months and for which there was a default during the period to cause the TDR finance receivables to be considered nonperforming (90 days or more past due) are reflected in the following table:


		Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in millions)	(dollars in millions)	2022		2021		2022		2021		(dollars in millions)	Three Months Ended September 30, 2022		Nine Months Ended September 30, 2022

TDR net finance receivables *	TDR net finance receivables *	$	34	$	31	$	94	$	88	TDR net finance receivables *	$	34	$	94
Number of TDR accounts	Number of TDR accounts	4,348		4,221		11,906		12,147		Number of TDR accounts	4,348		11,906

* Represents the corresponding balance of TDR net finance receivables at the end of the month in which they defaulted.

UNFUNDED LENDING COMMITMENTS

Our unfunded lending commitments consist of the unused credit card lines, which are unconditionally cancellable. We do not anticipate that all of our customers will access their entire available line at any given point in time. The unused credit card lines totaled ~~$64~~$204 million at September 30, ~~2022~~2023 and ~~$54~~$81 million at December 31, ~~2021.~~2022.

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4. Allowance for Finance Receivable Losses

We establish an allowance for finance receivable losses through the provision for finance receivable losses. We evaluate our finance receivable portfolio by the level of contractual delinquency in the portfolio, specifically in the late-stage delinquency buckets and inclusive of the migration of the finance receivables through the delinquency buckets. We estimate and record an allowance for finance receivable losses to cover the ~~estimated~~expected lifetime ~~expected~~ credit losses on our finance receivables. Our allowance for finance receivable losses may fluctuate based upon changes in portfolio growth, credit quality, and economic conditions.

Our ~~current~~ methodology to estimate expected credit losses ~~used the most~~uses recent macroeconomic forecasts, which ~~incorporated the overall unemployment rate. Our unemployment outlook leveraged~~include forecasts for unemployment. We leverage projections from various industry leading ~~forecast~~ providers. We also ~~considered~~consider inflationary pressures, consumer confidence levels, and ~~the risk of ongoing~~ interest rate increases ~~negatively impacting~~that may continue to impact the economic ~~outlook~~.outlook. At September 30, ~~2022,~~2023, our economic forecast used a reasonable and supportable period of 12 months. The increase in our allowance for finance receivable losses for the three and nine months ended September 30, ~~2022~~2023 was primarily due to the ~~weakened macroeconomic environment and~~ growth in ~~our loan portfolio.~~net finance receivables. We may experience further changes to the macroeconomic assumptions within our forecast, as well as changes to our loan loss performance outlook, both of which could lead to further changes in our allowance for finance receivable losses, allowance ratio, and provision for finance receivable losses.

Changes in the allowance for finance receivable losses were as follows:

(dollars in millions) Personal Loans Credit Cards Total
Three Months Ended September 30, 2022
Balance at beginning of period $ 2,115 $ 12 $ 2,127
Provision for finance receivable losses 415 6 421
Charge-offs (349) (3) (352)
Recoveries 59 — 59
Balance at end of period $ 2,240 $ 15 $ 2,255
Three Months Ended September 30, 2021*
Balance at beginning of period $ 2,000 $ — $ 2,000
Provision for finance receivable losses 226 — 226
Charge-offs (223) — (223)
Recoveries 58 — 58
Balance at end of period $ 2,061 $ — $ 2,061
Nine Months Ended September 30, 2022
Balance at beginning of period $ 2,090 $ 5 $ 2,095
Provision for finance receivable losses 985 13 998
Charge-offs (1,029) (3) (1,032)
Recoveries 194 — 194
Balance at end of period $ 2,240 $ 15 $ 2,255
Nine Months Ended September 30, 2021*
Balance at beginning of period $ 2,269 $ — $ 2,269
Provision for finance receivable losses 356 — 356
Charge-offs (730) — (730)
Recoveries 166 — 166
Balance at end of period $ 2,061 $ — $ 2,061


(dollars in millions)	Personal Loans		Credit Cards		Total

Three Months Ended September 30, 2023
Balance at beginning of period	$	2,360	$	32	$	2,392
Provision for finance receivable losses	386		24		410
Charge-offs	(410)		(6)		(416)
Recoveries	63		—		63
Balance at end of period	$	2,399	$	50	$	2,449

Three Months Ended September 30, 2022
Balance at beginning of period	$	2,115	$	12	$	2,127
Provision for finance receivable losses	415		6		421
Charge-offs	(349)		(3)		(352)
Recoveries	59		—		59

Balance at end of period	$	2,240	$	15	$	2,255

Nine Months Ended September 30, 2023
Balance at beginning of period	$	2,290	$	21	$	2,311

Impact of adoption of ASU 2022-02 *	(16)		—		(16)
Provision for finance receivable losses	1,227		48		1,275
Charge-offs	(1,302)		(19)		(1,321)
Recoveries	200		—		200

Balance at end of period	$	2,399	$	50	$	2,449



Nine Months Ended September 30, 2022
Balance at beginning of period	$	2,090	$	5	$	2,095

Provision for finance receivable losses	985		13		998
Charge-offs	(1,029)		(3)		(1,032)
Recoveries	194		—		194

Balance at end of period	$	2,240	$	15	$	2,255

* ~~The~~ As a result of the adoption of ASU 2022-02, we recorded a one-time adjustment to the allowance for finance receivable ~~losses~~losses. See Notes 2 and 3 for ~~credit cards was immaterial for~~additional information on the ~~three and nine months ended September 30, 2021 as the product offering began in the third quarter~~adoption of ~~2021.~~

ASU 2022-02.

~~Table of Contents~~

~~The allowance for finance receivable losses and net finance receivables by impairment method were as follows:~~

(dollars in millions) Personal Loans Credit Cards Total
September 30, 2022
Allowance for finance receivable losses:
Collectively evaluated for impairment $ 1,933 $ 15 $ 1,948
TDR finance receivables 307 — 307
Total $ 2,240 $ 15 $ 2,255
Finance receivables:
Collectively evaluated for impairment $ 18,871 $ 79 $ 18,950
TDR finance receivables 802 — 802
Total $ 19,673 $ 79 $ 19,752
Allowance for finance receivable losses as a percentage of finance receivables 11.39 % 19.14 % 11.42 %
December 31, 2021
Allowance for finance receivable losses:
Collectively evaluated for impairment $ 1,820 $ 5 $ 1,825
TDR finance receivables 270 — 270
Total $ 2,090 $ 5 $ 2,095
Finance receivables:
Collectively evaluated for impairment $ 18,537 $ 25 $ 18,562
TDR finance receivables 650 — 650
Total $ 19,187 $ 25 $ 19,212
Allowance for finance receivable losses as a percentage of finance receivables 10.89 % 19.91 % 10.90 %

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5. Investment Securities

AVAILABLE-FOR-SALE SECURITIES

Cost/amortized cost, allowance for credit losses, unrealized gains and losses, and fair value of fixed maturity available-for-sale securities by type were as follows:


(dollars in millions)	(dollars in millions)	Cost/ Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value		(dollars in millions)	Cost/ Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value

September 30, 2022*
September 30, 2023*										September 30, 2023*
Fixed maturity available-for-sale securities:	Fixed maturity available-for-sale securities:									Fixed maturity available-for-sale securities:
U.S. government and government sponsored entities	U.S. government and government sponsored entities	$	12	$	—	$	(1)	$	11	U.S. government and government sponsored entities	$	15	$	—	$	(1)	$	14
Obligations of states, municipalities, and political subdivisions	Obligations of states, municipalities, and political subdivisions	72		—		(8)		64		Obligations of states, municipalities, and political subdivisions	72		—		(8)		64
Commercial paper	Commercial paper	53		—		—		53		Commercial paper	23		—		—		23
Non-U.S. government and government sponsored entities	Non-U.S. government and government sponsored entities	144		—		(9)		135		Non-U.S. government and government sponsored entities	163		—		(10)		153
Corporate debt	Corporate debt	1,249		—		(135)		1,114		Corporate debt	1,149		2		(126)		1,025
Mortgage-backed, asset-backed, and collateralized:	Mortgage-backed, asset-backed, and collateralized:									Mortgage-backed, asset-backed, and collateralized:
RMBS	RMBS	208		—		(24)		184		RMBS	203		—		(31)		172
CMBS	CMBS	39		—		(3)		36		CMBS	37		—		(4)		33
CDO/ABS	CDO/ABS	89		—		(9)		80		CDO/ABS	90		—		(7)		83
Total	Total	$	1,866	$	—	$	(189)	$	1,677	Total	$	1,752	$	2	$	(187)	$	1,567

December 31, 2021*
December 31, 2022*										December 31, 2022*
Fixed maturity available-for-sale securities:	Fixed maturity available-for-sale securities:									Fixed maturity available-for-sale securities:
U.S. government and government sponsored entities	U.S. government and government sponsored entities	$	16	$	—	$	—	$	16	U.S. government and government sponsored entities	$	17	$	—	$	(1)	$	16
Obligations of states, municipalities, and political subdivisions	Obligations of states, municipalities, and political subdivisions	76		3		—		79		Obligations of states, municipalities, and political subdivisions	74		—		(8)		66
Commercial paper	Commercial paper	50		—		—		50		Commercial paper	55		—		—		55
Non-U.S. government and government sponsored entities	Non-U.S. government and government sponsored entities	151		4		—		155		Non-U.S. government and government sponsored entities	150		—		(8)		142
Corporate debt	Corporate debt	1,246		61		(5)		1,302		Corporate debt	1,251		1		(115)		1,137
Mortgage-backed, asset-backed, and collateralized:	Mortgage-backed, asset-backed, and collateralized:									Mortgage-backed, asset-backed, and collateralized:
RMBS	RMBS	169		3		(2)		170		RMBS	217		—		(25)		192
CMBS	CMBS	44		1		—		45		CMBS	38		—		(3)		35
CDO/ABS	CDO/ABS	90		1		(1)		90		CDO/ABS	95		—		(9)		86
Total	Total	$	1,842	$	73	$	(8)	$	1,907	Total	$	1,897	$	1	$	(169)	$	1,729

* The allowance for credit losses related to our investment securities as of September 30, ~~2022~~2023 and December 31, ~~2021 were~~2022 was immaterial.

Interest receivables reported in ~~“Other assets”~~Other assets in our condensed consolidated balance sheets totaled $14 million as of September 30, ~~2022~~2023 and ~~$13 million as of~~ December 31, ~~2021, respectively.~~2022. There were no material amounts reversed from investment revenue for available-for-sale securities for the three and nine months ended September 30, ~~2022~~2023 and ~~2021.~~2022.

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Fair value and unrealized losses on available-for-sale securities by type and length of time in a continuous unrealized loss position without an allowance for credit losses were as follows:


		Less Than 12 Months				12 Months or Longer				Total					Less Than 12 Months				12 Months or Longer				Total
(dollars in millions)	(dollars in millions)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		(dollars in millions)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses

September 30, 2022
September 30, 2023														September 30, 2023
U.S. government and government sponsored entities	U.S. government and government sponsored entities	$	10	$	(1)	$	1	$	—	$	11	$	(1)	U.S. government and government sponsored entities	$	1	$	—	$	11	$	(1)	$	12	$	(1)
Obligations of states, municipalities, and political subdivisions	Obligations of states, municipalities, and political subdivisions	57		(7)		6		(1)		63		(8)		Obligations of states, municipalities, and political subdivisions	2		—		59		(8)		61		(8)
Commercial paper	Commercial paper	53		—		—		—		53		—		Commercial paper	23		—		—		—		23		—
Non-U.S. government and government sponsored entities	Non-U.S. government and government sponsored entities	117		(6)		16		(3)		133		(9)		Non-U.S. government and government sponsored entities	29		(1)		99		(9)		128		(10)
Corporate debt	Corporate debt	953		(102)		135		(33)		1,088		(135)		Corporate debt	102		(4)		895		(122)		997		(126)
Mortgage-backed, asset-backed, and collateralized:	Mortgage-backed, asset-backed, and collateralized:													Mortgage-backed, asset-backed, and collateralized:
RMBS	RMBS	129		(13)		49		(11)		178		(24)		RMBS	22		(1)		148		(30)		170		(31)
CMBS	CMBS	29		(3)		7		—		36		(3)		CMBS	2		—		31		(4)		33		(4)
CDO/ABS	CDO/ABS	57		(5)		24		(4)		81		(9)		CDO/ABS	10		—		63		(7)		73		(7)
Total	Total	$	1,405	$	(137)	$	238	$	(52)	$	1,643	$	(189)	Total	$	191	$	(6)	$	1,306	$	(181)	$	1,497	$	(187)

December 31, 2021
December 31, 2022														December 31, 2022
U.S. government and government sponsored entities	U.S. government and government sponsored entities	$	6	$	—	$	—	$	—	$	6	$	—	U.S. government and government sponsored entities	$	10	$	—	$	6	$	(1)	$	16	$	(1)
Obligations of states, municipalities, and political subdivisions	Obligations of states, municipalities, and political subdivisions	10		—		—		—		10		—		Obligations of states, municipalities, and political subdivisions	48		(5)		15		(3)		63		(8)
Commercial paper	Commercial paper	46		—		—		—		46		—		Commercial paper	51		—		—		—		51		—
Non-U.S. government and government sponsored entities	Non-U.S. government and government sponsored entities	19		—		5		—		24		—		Non-U.S. government and government sponsored entities	104		(3)		32		(5)		136		(8)
Corporate debt	Corporate debt	208		(3)		38		(2)		246		(5)		Corporate debt	779		(54)		299		(61)		1,078		(115)
Mortgage-backed, asset-backed, and collateralized:	Mortgage-backed, asset-backed, and collateralized:													Mortgage-backed, asset-backed, and collateralized:
RMBS	RMBS	81		(1)		15		(1)		96		(2)		RMBS	106		(9)		68		(16)		174		(25)
CMBS	CMBS	7		—		—		—		7		—		CMBS	21		(2)		13		(1)		34		(3)
CDO/ABS	CDO/ABS	41		(1)		3		—		44		(1)		CDO/ABS	45		(3)		35		(6)		80		(9)
Total	Total	$	418	$	(5)	$	61	$	(3)	$	479	$	(8)	Total	$	1,164	$	(76)	$	468	$	(93)	$	1,632	$	(169)

On a lot basis, we had ~~2,315~~2,192 and ~~570~~2,280 investment securities in an unrealized loss position at September 30, ~~2022~~2023 and December 31, ~~2021,~~2022, respectively. We do not consider the unrealized losses to be credit-related, as these unrealized losses primarily relate to changes in interest rates and market spreads subsequent to purchase. Additionally, as of September 30, ~~2022,~~2023, there were no credit impairments on investment securities that we intend to sell. We do not have plans to sell any of the remaining investment securities with unrealized losses as of September 30, ~~2022,~~2023, and we believe it is more likely than not that we would not be required to sell such investment securities before recovery of their amortized cost.

We continue to monitor unrealized loss positions for potential credit impairments. During the three and nine months ended September 30, ~~2022~~2023 and ~~2021,~~2022, there were no material credit impairments related to our investment securities. Therefore, there were no material additions or reductions in the allowance for credit losses (impairments recognized or reversed in earnings) on credit impaired available-for-sale securities for the three and nine months ended September 30, ~~2022~~2023 and ~~2021.~~2022.

The proceeds of available-for-sale securities sold or redeemed during the three and nine months ended September 30, 2023 totaled $27 million and $74 million, respectively. The proceeds of available-for-sale securities sold or redeemed during the three and nine months ended September 30, 2022 totaled $34 million and $235 million, respectively. The ~~proceeds of available-for-sale securities sold or redeemed during the three and nine months ended September 30, 2021 totaled $50 million and $189 million, respectively. The~~ net realized gains and losses were immaterial during the three and nine months ended September 30, ~~2022~~2023 and ~~2021.~~2022.

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Contractual maturities of fixed-maturity available-for-sale securities at September 30, ~~2022~~2023 were as follows:


(dollars in millions)	(dollars in millions)	Fair Value		Amortized Cost		(dollars in millions)	Fair Value		Amortized Cost

Fixed maturities, excluding mortgage-backed, asset-backed, and collateralized securities:	Fixed maturities, excluding mortgage-backed, asset-backed, and collateralized securities:					Fixed maturities, excluding mortgage-backed, asset-backed, and collateralized securities:
Due in 1 year or less	Due in 1 year or less	$	186	$	187	Due in 1 year or less	$	151	$	153
Due after 1 year through 5 years	Due after 1 year through 5 years	514		544		Due after 1 year through 5 years	534		568
Due after 5 years through 10 years	Due after 5 years through 10 years	526		616		Due after 5 years through 10 years	478		557
Due after 10 years	Due after 10 years	151		183		Due after 10 years	116		144
Mortgage-backed, asset-backed, and collateralized securities	Mortgage-backed, asset-backed, and collateralized securities	300		336		Mortgage-backed, asset-backed, and collateralized securities	288		330
Total	Total	$	1,677	$	1,866	Total	$	1,567	$	1,752

Actual maturities may differ from contractual maturities since issuers and borrowers may have the right to call or prepay obligations. We may sell investment securities before maturity for general corporate and working capital purposes and to achieve certain investment strategies.

The fair value of securities on deposit with third parties totaled ~~$534~~$488 million and ~~$587~~$532 million at September 30, ~~2022~~2023 and December 31, ~~2021,~~2022, respectively.

OTHER SECURITIES

The fair value of other securities by type was as follows:


(dollars in millions)	(dollars in millions)	September 30, 2022		December 31, 2021		(dollars in millions)	September 30, 2023		December 31, 2022

Fixed maturity other securities:	Fixed maturity other securities:					Fixed maturity other securities:

Bonds	Bonds	$	25	$	30	Bonds	$	22	$	23
Preferred stock *	Preferred stock *	16		22		Preferred stock *	15		15
Common stock *	Common stock *	29		33		Common stock *	31		33

Total	Total	$	70	$	85	Total	$	68	$	71

* We employ an income equity strategy targeting investments in stocks with strong current dividend yields. Stocks included have a history of stable or increasing dividend payments.

Net unrealized losses on other securities held were immaterial for the three and nine months ended September 30, 2023. Net unrealized losses on other securities held were immaterial for the three months ended September 30, 2022 and $12 million for the nine months ended September 30, 2022. ~~Net unrealized gains and losses on other securities held were immaterial for the three and nine months ended September 30, 2021.~~ Net realized gains and losses on other securities sold or redeemed were immaterial for the three and nine months ended September 30, ~~2022~~2023 and ~~2021.~~2022.

Other securities primarily consist of equity securities and those securities for which the fair value option was elected. We report net unrealized and realized gains and losses on other securities held, sold, or redeemed in investment revenue.

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6. Long-term Debt

Principal maturities of long-term debt by type of debt at September 30, ~~2022~~2023 were as follows:


		Senior Debt													Senior Debt
(dollars in millions)	(dollars in millions)	Securitizations		Private Secured Term Funding		Revolving Conduit Facilities		Unsecured Notes (a) (e)		Junior Subordinated Debt (a)			Total			(dollars in millions)	Securitizations		Private Secured Term Funding		Unsecured Notes (a)		Junior Subordinated Debt (a)			Total

Interest rates (b)	Interest rates (b)	0.87%-6.86%		3.30%		3.15%-3.41%		3.50%-8.25%		4.26		%				Interest rates (b)	0.87%-7.52%		6.41%		3.50%-9.00%		7.32		%

Remainder of 2022		$	—	$	—	$	—	$	—	$	—		$	—
2023		—		—		—		1,108		—			1,108
Remainder of 2023																Remainder of 2023	$	—	$	—	$	226	$	—		$	226
2024	2024	—		—		—		1,270		—			1,270			2024	—		—		558		—			558
2025	2025	—		—		—		1,249		—			1,249			2025	—		—		1,249		—			1,249
2026	2026	—		—		—		1,600		—			1,600			2026	—		—		1,600		—			1,600
2027-2067		—		—		—		3,682		350			4,032
2027																2027	—		—		750		—			750
2028-2067																2028-2067	—		—		3,432		350			3,782
Secured (c)	Secured (c)	8,374		350		500		—		—			9,224			Secured (c)	11,616		350		—		—			11,966

Total principal maturities	Total principal maturities	$	8,374	$	350	$	500	$	8,909	$	350		$	18,483		Total principal maturities	$	11,616	$	350	$	7,815	$	350		$	20,131

Total carrying amount	Total carrying amount	$	8,335	$	349	$	500	$	8,846	$	172		$	18,202		Total carrying amount	$	11,567	$	350	$	7,762	$	172		$	19,851
Debt issuance costs (d)	Debt issuance costs (d)	(37)		(1)		—		(66)		—			(104)			Debt issuance costs (d)	(47)		—		(55)		—			(102)

(a) Pursuant to the Base Indenture, the Supplemental Indentures, and the Guaranty Agreements, OMH agreed to fully and unconditionally guarantee, on a senior unsecured basis, payments of principal, premium and interest on the Unsecured Notes and Junior Subordinated Debenture. The OMH guarantees of OMFC’s long-term debt are subject to customary release provisions.

(b) The interest rates shown are the range of contractual rates in effect at September 30, ~~2022.~~2023.

(c) Securitizations and private secured term funding ~~and borrowings under the revolving conduit facilities~~ are not included in the above maturities by period due to their variable monthly repayments, which may result in pay-off prior to the stated maturity date. At September 30, 2023, there were no amounts drawn under our revolving conduit facilities. See Note 7 for further information on our long-term debt associated with securitizations, private secured term funding, and revolving conduit facilities.

(d) Debt issuance costs are reported as a direct deduction from long-term debt, with the exception of debt issuance costs associated with our revolving conduit facilities and unsecured corporate revolver, which totaled $2932 million at September 30, ~~2022~~2023 and are reported in ~~“Other assets.”~~

~~(e) During the nine months ended September 30, 2022, we repurchased,~~Other assets in ~~the open market, portions of~~ our ~~Unsecured Notes in the amount of $165 million. In connection with these repurchases, we recognized a gain of $3 million in net gain (loss) on repurchases and repayments of debt.~~condensed consolidated balance sheets.

~~Redemption of 8.875% Senior Notes Due 2025~~

UNSECURED CORPORATE REVOLVER

On April 26, 2022, OMFC issued a notice to fully redeem its 8.875% Senior Notes due 2025. On June 1, 2022, OMFC paid a net aggregate amount of $637 million, inclusive of accrued interest and premiums, to complete the redemption. In connection with the redemption, we recognized $26 million of net loss on repurchases and repayments of debt during the second quarter of 2022.

~~Unsecured Corporate Revolver~~

~~On June 15, 2022, OMFC increased~~At September 30, 2023, the total maximum borrowing capacity of ~~its~~our unsecured corporate revolver towas $1.25 billion. The corporate revolver has a five-year term beginning October 25, 2021, during which draws and repayments may occur. Any outstanding principal balance is due and payable on October 25, 2026. At September 30, ~~2022,~~2023, no amounts were drawn under this facility.

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7. Variable Interest Entities

CONSOLIDATED VIES

We have transferred finance receivables to VIEs for asset-backed financing transactions and include the assets and liabilities in our condensed consolidated financial statements because we are the primary beneficiary of each VIE. We account for these asset-backed debt obligations as securitized borrowings.

See Note 2 and Note 9 of the Notes to the Consolidated Financial Statements in Part II - Item 8 included in our Annual Report for more detail regarding VIEs.

We parenthetically disclose on our consolidated balance sheets the VIE’s assets that can only be used to settle the VIE’s obligations and liabilities when its creditors have no recourse against the primary beneficiary’s general credit. The carrying amounts of consolidated VIE assets and liabilities associated with our securitization trusts, private secured term funding, and revolving conduit facilities were as follows:


(dollars in millions)	(dollars in millions)	September 30, 2022		December 31, 2021		(dollars in millions)	September 30, 2023		December 31, 2022

Assets	Assets					Assets
Cash and cash equivalents	Cash and cash equivalents	$	3	$	2	Cash and cash equivalents	$	2	$	2
Net finance receivables	Net finance receivables	10,069		8,821		Net finance receivables	13,229		10,432
Allowance for finance receivable losses	Allowance for finance receivable losses	1,073		910		Allowance for finance receivable losses	1,480		1,126
Restricted cash and restricted cash equivalents	Restricted cash and restricted cash equivalents	472		466		Restricted cash and restricted cash equivalents	564		442
Other assets	Other assets	26		26		Other assets	30		28

Liabilities	Liabilities					Liabilities
Long-term debt	Long-term debt	$	9,184	$	7,999	Long-term debt	$	11,917	$	9,361
Other liabilities	Other liabilities	18		13		Other liabilities	27		20

Other than the retained subordinate and residual interests in our consolidated VIEs, we are under no further obligation than is otherwise noted herein, either contractually or implicitly, to provide financial support to these entities. Consolidated interest expense related to our VIEs totaled $128 million and $343 million during the three and nine months ended September 30, 2023, respectively, compared to $81 million and $214 million during the three and nine months ended September 30, 2022, ~~respectively, compared to $72 million and $225 million during the three and nine months ended September 30, 2021,~~ respectively.

SECURITIZED BORROWINGS

Each of our outstanding securitizations contain a revolving period ranging from two to seven years during which no principal payments are required to be made on the related asset-backed notes. The indentures governing our securitized borrowings contain early amortization events and events of default, that, if triggered, may result in the acceleration of the obligation to pay principal and interest on the related asset-backed notes.

PRIVATE SECURED TERM FUNDING

At September 30, ~~2022,~~2023, an aggregate amount of $350 million was outstanding under the private secured term funding collateralized by our personal loans. No principal payments are required to be made until after April 25, 2025, followed by a subsequent one-year amortization period, at the expiration of which the outstanding principal amount is due and payable.

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REVOLVING CONDUIT FACILITIES

We had access to 15 revolving conduit facilities with a total maximum borrowing capacity of $6.2 billion as of September 30, ~~2022.~~2023. Our conduit facilities contain revolving periods during which time no principal payments are required, but may be made without penalty, followed by a subsequent amortization period. Principal balances of outstanding loans, if any, are due and payable in full over periods ranging up to ~~eight~~nine years as of September 30, ~~2022.~~2023. Amounts drawn on these facilities are collateralized by our personal loans.

At September 30, ~~2022, an aggregate amount of $500 million was~~2023, no amounts were drawn under these ~~facilities and the remaining borrowing capacity was $5.7 billion.~~

facilities.


8. Insurance

Changes in the reserve for unpaid claims and loss adjustment expenses (net of reinsurance recoverables): on our short-duration insurance contracts:


		At or for the Nine Months Ended September 30,					At or for the Nine Months Ended September 30,
(dollars in millions)	(dollars in millions)	2022		2021		(dollars in millions)	2023		2022 (a)

Balance at beginning of period	Balance at beginning of period	$	118	$	148	Balance at beginning of period	$	93	$	102
Less reinsurance recoverables	Less reinsurance recoverables	(3)		(3)		Less reinsurance recoverables	(3)		(3)

Net balance at beginning of period	Net balance at beginning of period	115		145		Net balance at beginning of period	90		99

Additions for losses and loss adjustment expenses incurred to:	Additions for losses and loss adjustment expenses incurred to:					Additions for losses and loss adjustment expenses incurred to:
Current year	Current year	142		158		Current year	127		114
Prior years *		(15)		(19)
Prior years (b)						Prior years (b)	(2)		(13)
Total	Total	127		139		Total	125		101
Reductions for losses and loss adjustment expenses paid related to:	Reductions for losses and loss adjustment expenses paid related to:					Reductions for losses and loss adjustment expenses paid related to:
Current year	Current year	(77)		(91)		Current year	(67)		(59)
Prior years	Prior years	(61)		(79)		Prior years	(49)		(50)
Total	Total	(138)		(170)		Total	(116)		(109)
Foreign currency translation adjustment	Foreign currency translation adjustment	1		—		Foreign currency translation adjustment	—		1
Net balance at end of period	Net balance at end of period	105		114		Net balance at end of period	99		92
Plus reinsurance recoverables	Plus reinsurance recoverables	3		3		Plus reinsurance recoverables	3		3

Balance at end of period	Balance at end of period	$	108	$	117	Balance at end of period	$	102	$	95

*(a) As a result of the modified retrospective adoption of ASU 2018-12, we have recorded a $16 million reduction to the 2022 beginning balance, and the previously reported balances were recast to exclude reserves for unpaid claims on our long-duration contracts. These reserves have been included in our estimate of the liability for future policy benefits as of the transition date of January 1, 2021. See Note 2 for additional information on the adoption of ASU 2018-12.

(b) At September 30, 2023, $2 million reflected a redundancy in the prior years’ net reserves, primarily due to favorable development of credit disability claims during the period. At September 30, 2022, ~~$15~~$13 million reflected a redundancy in the prior years’ net reserves, primarily due to favorable development of credit life and credit disability and term life claims during the period. At September 30, 2021, $19 million reflected a redundancy in the prior years’ net reserves, primarily due to favorable development of credit disability and unemployment claims during the period.

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LIABILITY FOR FUTURE POLICY BENEFITS

The present value of expected net premiums on long-duration insurance contracts were as follows:


	At or for the Nine Months Ended September 30,

	2023				2022
(dollars in millions)	Term and Whole Life		Accidental Death and Disability Protection		Term and Whole Life		Accidental Death and Disability Protection
Balance at beginning of period	$	252	$	48	$	313	$	69
Effect of cumulative changes in discount rate assumptions (beginning of period)	(8)		—		(53)		(10)
Beginning balance at original discount rate	244		48		260		59
Effect of changes in cash flow assumptions	(2)		(1)		—		—
Effect of actual variances from expected experience	(7)		(1)		15		(3)
Adjusted balance at beginning of period	235		46		275		56

Interest accretion	9		2		10		2
Net premiums collected	(25)		(5)		(37)		(9)

Ending balance at original discount rate	219		43		248		49
Effect of changes in discount rate assumptions	(3)		(2)		(1)		(1)
Balance at ending of period	$	216	$	41	$	247	$	48

The present value of expected future policy benefits on long-duration insurance contracts were as follows:


	At or for the Nine Months Ended September 30,

	2023				2022
(dollars in millions)	Term and Whole Life		Accidental Death and Disability Protection		Term and Whole Life		Accidental Death and Disability Protection
Balance at beginning of period	$	483	$	126	$	601	$	165
Effect of cumulative changes in discount rate assumptions (beginning of period)	(17)		(1)		(109)		(27)
Beginning balance at original discount rate	466		125		492		138
Effect of changes in cash flow assumptions	(4)		(1)		—		—
Effect of actual variances from expected experience	(9)		1		2		(7)
Adjusted balance at beginning of period	453		125		494		131
Net issuances	2		1		2		—
Interest accretion	18		4		19		5
Benefit payments	(41)		(14)		(45)		(10)

Ending balance at original discount rate	432		116		470		126
Effect of changes in discount rate assumptions	(4)		(5)		—		(3)
Balance at ending of period	$	428	$	111	$	470	$	123

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The net liability for future policy benefits on long-duration insurance contracts were as follows:


	At or for the Nine Months Ended September 30,
	2023				2022

(dollars in millions)	Term and Whole Life		Accidental Death and Disability Protection		Term and Whole Life		Accidental Death and Disability Protection
Net liability for future policy benefits	$	212	$	70	$	223	$	75

Deferred profit liability	14		53		16		58
Total net liability for future policy benefits	$	226	$	123	$	239	$	133

The weighted-average duration of the liability for future policy benefits was 8 years at September 30, 2023 and September 30, 2022.

The following table reconciles the net liability for future policy benefits to Insurance claims and policyholder liabilities in the condensed consolidated balance sheets:


	At or for the Nine Months Ended September 30,
(dollars in millions)	2023		2022
Term and whole life	$	226	$	239
Accidental death and disability protection	123		133
Other*	250		229
Total	$	599	$	601

* Other primarily includes reserves for short-duration contracts that are payable to third-party beneficiaries.

The undiscounted and discounted expected future gross premiums and expected future benefits and expenses for our long-duration insurance contracts were as follows:


	At or for the Nine Months Ended September 30,

	2023				2022
(dollars in millions)	Term and Whole Life		Accidental Death and Disability Protection		Term and Whole Life		Accidental Death and Disability Protection
Expected future gross premiums:
Undiscounted	$	445	$	150	$	503	$	167
Discounted	310		105		353		117
Expected future benefit payments:
Undiscounted	622		171		683		185
Discounted	428		111		470		123

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The revenue and interest accretion related to our long-duration insurance contracts recognized in the condensed consolidated statements of operations were as follows:


	At or for the Nine Months Ended September 30,

	2023				2022
(dollars in millions)	Term and Whole Life		Accidental Death and Disability Protection		Term and Whole Life		Accidental Death and Disability Protection
Gross premiums or assessments	$	44	$	14	$	47	$	15

Interest accretion	$	9	$	3	$	9	$	3

The expected and actual experience for mortality, morbidity, and lapses of the liability for future policy benefits were as follows:


	At or for the Nine Months Ended September 30,

	2023				2022
	Term and Whole Life		Accidental Death and Disability Protection		Term and Whole Life		Accidental Death and Disability Protection
Mortality/Morbidity:
Expected	0.38	%	0.01	%	0.39	%	0.01	%
Actual	0.35	%	0.01	%	0.36	%	0.01	%



Lapses:
Expected	2.85	%	1.95	%	4.19	%	1.95	%
Actual	2.27	%	2.07	%	2.11	%	3.09	%

The weighted-average interest rates for the liability of future policy benefits for our long-duration insurance contracts were as follows:


	At or for the Nine Months Ended September 30,

	2023				2022
	Term and Whole Life		Accidental Death and Disability Protection		Term and Whole Life		Accidental Death and Disability Protection
Interest accretion rate	5.27	%	4.86	%	5.26	%	4.86	%
Current discount rate	5.60	%	5.59	%	5.49	%	5.40	%

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9. Capital Stock and Earnings Per Share (OMH Only)

CAPITAL STOCK

OMH has two classes of authorized capital stock: preferred stock and common stock. OMFC has two classes of authorized capital stock: special stock and common stock. OMH and OMFC may issue preferred stock and special stock, respectively, in one or more series. The OMH Board of Directors and the OMFC Board of Directors determine the dividend, liquidation, redemption, conversion, voting, and other rights prior to issuance.

Changes in OMH shares of common stock issued and outstanding were as follows:


		Three Months Ended September 30,		Nine Months Ended September 30,			Three Months Ended September 30,		Nine Months Ended September 30,
		2022	2021	2022	2021		2023	2022	2023	2022

Balance at beginning of period	Balance at beginning of period	123,726,559	133,884,043	127,809,640	134,341,724	Balance at beginning of period	120,446,799	123,726,559	121,042,125	127,809,640
Common stock issued	Common stock issued	44,479	4,653	310,751	159,327	Common stock issued	45,507	44,479	261,955	310,751
Common stock repurchased	Common stock repurchased	(1,180,433)	(2,435,489)	(5,559,382)	(3,047,844)	Common stock repurchased	(268,269)	(1,180,433)	(1,120,903)	(5,559,382)
Treasury stock issued	Treasury stock issued	28,143	—	57,739	—	Treasury stock issued	21,260	28,143	62,120	57,739

Balance at end of period	Balance at end of period	122,618,748	131,453,207	122,618,748	131,453,207	Balance at end of period	120,245,297	122,618,748	120,245,297	122,618,748

EARNINGS PER SHARE (OMH ONLY)

The computation of earnings per share was as follows:


		Three Months Ended September 30,				Nine Months Ended September 30,					Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in millions, except per share data)	(dollars in millions, except per share data)	2022		2021		2022		2021		(dollars in millions, except per share data)	2023		2022		2023		2022

Numerator (basic and diluted):	Numerator (basic and diluted):									Numerator (basic and diluted):
Net income	Net income	$	188	$	288	$	698	$	1,051	Net income	$	194	$	185	$	476	$	696
Denominator:	Denominator:									Denominator:
Weighted average number of shares outstanding (basic)	Weighted average number of shares outstanding (basic)	123,352,522		132,487,234		124,989,263		133,709,146		Weighted average number of shares outstanding (basic)	120,407,889		123,352,522		120,571,103		124,989,263
Effect of dilutive securities *	Effect of dilutive securities *	216,098		437,099		253,943		387,236		Effect of dilutive securities *	346,805		216,098		219,382		253,943
Weighted average number of shares outstanding (diluted)	Weighted average number of shares outstanding (diluted)	123,568,620		132,924,333		125,243,206		134,096,382		Weighted average number of shares outstanding (diluted)	120,754,694		123,568,620		120,790,485		125,243,206
Earnings per share:	Earnings per share:									Earnings per share:
Basic	Basic	$	1.52	$	2.17	$	5.58	$	7.86	Basic	$	1.61	$	1.50	$	3.95	$	5.56
Diluted	Diluted	$	1.52	$	2.17	$	5.57	$	7.84	Diluted	$	1.61	$	1.49	$	3.94	$	5.55

* We have excluded weighted-average unvested restricted stock units totaling ~~1,278,052~~886,333 and ~~491,541~~1,278,052 for the three months ended September 30, ~~2022~~2023 and ~~2021,~~2022, respectively, and ~~1,230,739~~933,663 and ~~322,430~~1,230,739 for the nine months ended September 30, ~~2022~~2023 and ~~2021,~~2022, respectively, from the fully-diluted earnings per share calculations as these shares would be anti-dilutive, which could impact the earnings per share calculation in the future.

Basic earnings per share is computed by dividing net income by the weighted-average number of shares outstanding during each period. Diluted earnings per share is computed based on the weighted-average number of shares outstanding plus the effect of potentially dilutive shares outstanding during the period using the treasury stock method. The potentially dilutive shares represent outstanding unvested restricted stock units.

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10. Accumulated Other Comprehensive Income (Loss)

Changes, net of tax, in ~~accumulated~~Accumulated other comprehensive income (loss) were as follows:


(dollars in millions)	(dollars in millions)	Unrealized Gains (Losses) Available-for-Sale Securities (a)		Retirement Plan Liabilities Adjustments		Foreign Currency Translation Adjustments		Other (b)		Total Accumulated Other Comprehensive Income (Loss)		(dollars in millions)	Unrealized Gains (Losses) Available-for-Sale Securities (a)		Retirement Plan Liabilities Adjustments		Foreign Currency Translation Adjustments		Changes in discount rate for insurance claims and policyholder liabilities		Other (b)		Total Accumulated Other Comprehensive Income (Loss)

Three Months Ended September 30, 2023												Three Months Ended September 30, 2023
Balance at beginning of period												Balance at beginning of period	$	(124)	$	(8)	$	(2)	$	(3)	$	23	$	(114)
Other comprehensive income (loss) before reclassifications												Other comprehensive income (loss) before reclassifications	(22)		—		(3)		7		3		(15)

Balance at end of period												Balance at end of period	$	(146)	$	(8)	$	(5)	$	4	$	26	$	(129)

Three Months Ended September 30, 2022	Three Months Ended September 30, 2022											Three Months Ended September 30, 2022
Balance at beginning of period	Balance at beginning of period	$	(95)	$	1	$	1	$	23	$	(70)	Balance at beginning of period	$	(95)	$	1	$	1	$	(13)	$	23	$	(83)
Other comprehensive income (loss) before reclassifications	Other comprehensive income (loss) before reclassifications	(50)		—		(8)		3		(55)		Other comprehensive income (loss) before reclassifications	(50)		—		(8)		14		3		(41)

Balance at end of period	Balance at end of period	$	(145)	$	1	$	(7)	$	26	$	(125)	Balance at end of period	$	(145)	$	1	$	(7)	$	1	$	26	$	(124)

Three Months Ended September 30, 2021
Nine Months Ended September 30, 2023												Nine Months Ended September 30, 2023
Balance at beginning of period	Balance at beginning of period	$	71	$	1	$	5	$	8	$	85	Balance at beginning of period	$	(131)	$	(8)	$	(5)	$	(8)	$	25	$	(127)
Other comprehensive income (loss) before reclassifications	Other comprehensive income (loss) before reclassifications	(7)		—		(2)		1		(8)		Other comprehensive income (loss) before reclassifications	(15)		—		—		12		1		(2)

Balance at end of period	Balance at end of period	$	64	$	1	$	3	$	9	$	77	Balance at end of period	$	(146)	$	(8)	$	(5)	$	4	$	26	$	(129)

Nine Months Ended September 30, 2022	Nine Months Ended September 30, 2022											Nine Months Ended September 30, 2022
Balance at beginning of period	Balance at beginning of period	$	49	$	1	$	3	$	8	$	61	Balance at beginning of period	$	49	$	1	$	3	$	(56)	$	8	$	5
Other comprehensive income (loss) before reclassifications	Other comprehensive income (loss) before reclassifications	(191)		—		(10)		18		(183)		Other comprehensive income (loss) before reclassifications	(191)		—		(10)		57		18		(126)
Reclassification adjustments from accumulated other comprehensive income	Reclassification adjustments from accumulated other comprehensive income	(3)		—		—		—		(3)		Reclassification adjustments from accumulated other comprehensive income	(3)		—		—		—		—		(3)
Balance at end of period	Balance at end of period	$	(145)	$	1	$	(7)	$	26	$	(125)	Balance at end of period	$	(145)	$	1	$	(7)	$	1	$	26	$	(124)

Nine Months Ended September 30, 2021
Balance at beginning of period		$	91	$	1	$	2	$	—	$	94
Other comprehensive income (loss) before reclassifications		(26)		—		1		9		(16)
Reclassification adjustments from accumulated other comprehensive income		(1)		—		—		—		(1)
Balance at end of period		$	64	$	1	$	3	$	9	$	77

(a) There were no material amounts related to available-for-sale debt securities for which an allowance for credit losses was recorded during the three and nine months ended September 30, ~~2022~~2023 and ~~2021.~~2022.

(b) Other primarily includes changes in the fair value of our mark-to-market derivative instruments that have been designated as cash flow hedges.

Reclassification adjustments from ~~accumulated~~Accumulated other comprehensive income (loss) to the applicable line item on our condensed consolidated statements of operations were immaterial for the three and nine months ended September 30, ~~2022~~2023 and ~~2021.~~2022.

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11. Income Taxes

We had a net deferred tax asset of ~~$439~~$482 million and ~~$339~~$456 million at September 30, ~~2022~~2023 and December 31, ~~2021,~~2022, respectively. ~~The increase in our net deferred tax asset of $100 million was primarily related to the change in fair value of investment securities and the increase in our allowance for finance receivable losses.~~

We follow the guidance of ASC 740, Income Taxes, for interim reporting of income taxes under which we calculate an estimated annual effective tax rate (“AETR”) and apply the AETR to our year-to-date income (loss) before income taxes. In addition, we recognize any discrete items as they occur.

The effective tax rate for the nine months ended September 30, ~~2022~~2023 was ~~24.6%~~23.1%, compared to ~~24.2%~~24.6% for the same period in ~~2021.~~2022. The effective tax rate for the nine months ended September 30, ~~2022~~2023 and ~~2021~~2022 differed from the federal statutory rate of 21% primarily due to the effect of state income taxes.

We are under examination by various states for the years 2017 to 2020. Management believes it has adequately provided for taxes for such years.

Our gross unrecognized tax benefits, including related interest and penalties, totaled $5$7 million at September 30, ~~2022~~2023 and $8$6 million at December 31, ~~2021.~~2022. We accrue interest related to uncertain tax positions in income tax expense. The amount of any change in the balance of uncertain tax liabilities over the next 12 months is not expected to be material to our condensed consolidated financial statements.

On August 16, 2022, the Inflation Reduction Act of 2022 (“IRA”) was signed into law. The IRA includes a 15% Corporate Alternative Minimum Tax (“Corporate AMT”) for tax years beginning after December 31, 2022. We do not expect the Corporate AMT to have a material impact on our consolidated financial statements. Additionally, the IRA imposes a 1% excise tax on net repurchases of stock by certain publicly traded corporations. The excise tax is imposed on the value of the net stock repurchased or treated as repurchased. The new law will apply to stock repurchases occurring after December 31, 2022.

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12. Contingencies

LEGAL CONTINGENCIES

In the normal course of business, we have been named, from time to time, as defendants in various legal actions, including arbitrations, class actions, and other litigation arising in connection with our activities. Some of the actual or threatened legal actions include claims for substantial compensatory and/or punitive damages or claims for indeterminate amounts of damages. Additionally, we are, from time to time, in the normal course of business, subject to inquiries and investigations by federal, state and local governmental authorities regarding our products and our operations. These inquiries and investigations may result in fines, restitution or other penalties, including injunctive relief that may result in restrictions on our business. While we will continue to evaluate legal actions to determine whether a loss is reasonably possible or probable and is reasonably estimable, there can be no assurance that material losses will not be incurred from pending, threatened or future litigation, investigations, examinations, or other claims.

We contest liability and/or the amount of damages, as appropriate, in each pending matter. Where available information indicates that it is probable that a liability had been incurred at the date of the condensed consolidated financial statements and we can reasonably estimate the amount of that loss, we accrue the estimated loss by a charge to income. In many actions, however, it is inherently difficult to determine whether any loss is probable or even reasonably possible, or to estimate the amount of any loss. In addition, even where loss is reasonably possible or an exposure to loss exists in excess of the liability already accrued with respect to a previously recognized loss contingency, it is not always possible to reasonably estimate the size of the possible loss or range of loss.

For certain legal actions, we cannot reasonably estimate such losses, particularly for actions that are in their early stages of development or where plaintiffs seek substantial or indeterminate damages. Numerous issues may need to be resolved, including through potentially lengthy discovery and determination of important factual matters, and by addressing novel or unsettled legal questions relevant to the actions in question, before a loss or additional loss or range of loss or range of additional loss can be reasonably estimated for any given action.

For certain other legal actions, we can estimate reasonably possible losses, additional losses, ranges of loss or ranges of additional loss in excess of amounts accrued, but do not believe, based on current knowledge and after consultation with counsel, that such losses will have a material adverse effect on our condensed consolidated financial statements as a whole.

In March 2022, the staff of the United States Consumer Financial Protection Bureau (“CFPB”) notified us that, in accordance with the CFPB’s discretionary Notice and Opportunity to Respond and Advise (“NORA”) process, it is considering recommending that the CFPB take legal action against the Company in connection with alleged violations of the Consumer Financial Protection Act, 12 U.S.C. §§ 5531, 5536. ~~The staff’s~~On May 31, 2023, the Company entered into a consent order with the CFPB to resolve this previously disclosed investigation is focused on certain refunding practices for optional insurance and membership plan products that were subsequently canceled by the ~~consumer~~customer after purchase. ~~We are cooperating with~~Pursuant to the ~~CFPB~~consent order, we agreed to issue $10 million in ~~this matter~~interest refunds to affected customers, pay a $10 million civil penalty and ~~expect ongoing interactions. Although~~make certain other enhancements to our sales and refunding practices. In agreeing to the ~~Company believes it has~~consent order, we did not ~~violated~~admit to any of the ~~Consumer Financial Protection Act, we are unable to estimate how long this investigation will continue, whether and in what manner the CFPB may commence~~CFPB’s factual findings or legal action, or what the ultimate outcome of this matter will be. Should the CFPB opt to commence legal proceedings, it may seek civil monetary penalties, restitution, injunctive relief, or other damages. The Company does not currently believe that the outcome of this matter will have a material adverse effect on our business, financial condition, or results of operations.

conclusions.

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13. Segment Information

At September 30, ~~2022,~~2023, Consumer and Insurance (“C&I”) is our only reportable segment. The remaining components (which we refer to as “Other”) consist of our liquidating SpringCastle Portfolio servicing activity and our non-originating legacy operations, which primarily include our liquidating real estate loans.

The accounting policies of the C&I segment are the same as those disclosed in Note 2 and Note 17 of the Notes to the Consolidated Financial Statements in Part II - Item 8 included in our Annual Report.

The following tables present information about C&I and Other, as well as reconciliations to the condensed consolidated financial statement amounts.

(dollars in millions) Consumer
and
Insurance Other Segment to
GAAP
Adjustment Consolidated
Total
Three Months Ended September 30, 2022
Interest income $ 1,116 $ 2 $ — $ 1,118
Interest expense 221 1 1 223
Provision for finance receivable losses 420 — 1 421
Net interest income after provision for finance receivable losses 475 1 (2) 474
Other revenues 168 3 (1) 170
Other expenses 392 3 (1) 394
Income before income tax expense $ 251 $ 1 $ (2) $ 250
Three Months Ended September 30, 2021
Interest income $ 1,111 $ 1 $ 1 $ 1,113
Interest expense 235 1 1 237
Provision for finance receivable losses 224 — 2 226
Net interest income after provision for finance receivable losses 652 — (2) 650
Other revenues 151 4 — 155
Other expenses 415 5 9 429
Income (loss) before income tax expense (benefit) $ 388 $ (1) $ (11) $ 376


(dollars in millions)										(dollars in millions)	Consumer and Insurance		Other		Segment to GAAP Adjustment		Consolidated Total

Three Months Ended September 30, 2023										Three Months Ended September 30, 2023
Interest income										Interest income	$	1,166	$	1	$	—	$	1,167
Interest expense										Interest expense	265		1		1		267
Provision for finance receivable losses										Provision for finance receivable losses	410		—		—		410
Net interest income after provision for finance receivable losses										Net interest income after provision for finance receivable losses	491		—		(1)		490
Other revenues										Other revenues	182		3		—		185
Other expenses										Other expenses	423		7		(1)		429
Income (loss) before income tax expense (benefit)										Income (loss) before income tax expense (benefit)	$	250	$	(4)	$	—	$	246

Three Months Ended September 30, 2022										Three Months Ended September 30, 2022
Interest income										Interest income	$	1,116	$	2	$	—	$	1,118
Interest expense										Interest expense	221		1		1		223
Provision for finance receivable losses										Provision for finance receivable losses	420		—		1		421
Net interest income after provision for finance receivable losses										Net interest income after provision for finance receivable losses	475		1		(2)		474
Other revenues										Other revenues	168		3		(1)		170
Other expenses										Other expenses	396		3		(1)		398
Income before income tax expense										Income before income tax expense	$	247	$	1	$	(2)	$	246

Nine Months Ended September 30, 2023										Nine Months Ended September 30, 2023
Interest income										Interest income	$	3,373	$	3	$	1	$	3,377
Interest expense										Interest expense	744		2		3		749
Provision for finance receivable losses										Provision for finance receivable losses	1,275		—		—		1,275
Net interest income after provision for finance receivable losses										Net interest income after provision for finance receivable losses	1,354		1		(2)		1,353
Other revenues										Other revenues	543		5		—		548
Other expenses										Other expenses	1,273		11		(2)		1,282
Income (loss) before income tax expense (benefit)										Income (loss) before income tax expense (benefit)	$	624	$	(5)	$	—	$	619

Assets										Assets	$	22,899	$	30	$	1,217	$	24,146

Nine Months Ended September 30, 2022	Nine Months Ended September 30, 2022									Nine Months Ended September 30, 2022
Interest income	Interest income	$	3,308	$	4	$	1	$	3,313	Interest income	$	3,308	$	4	$	1	$	3,313
Interest expense	Interest expense	657		2		2		661		Interest expense	657		2		2		661
Provision for finance receivable losses	Provision for finance receivable losses	995		—		3		998		Provision for finance receivable losses	995		—		3		998
Net interest income after provision for finance receivable losses	Net interest income after provision for finance receivable losses	1,656		2		(4)		1,654		Net interest income after provision for finance receivable losses	1,656		2		(4)		1,654
Other revenues	Other revenues	451		10		(1)		460		Other revenues	451		10		(1)		460
Other expenses	Other expenses	1,179		11		(2)		1,188		Other expenses	1,182		11		(2)		1,191
Income before income tax expense	Income before income tax expense	$	928	$	1	$	(3)	$	926	Income before income tax expense	$	925	$	1	$	(3)	$	923

Assets	Assets	$	20,281	$	40	$	2,020	$	22,341	Assets	$	20,281	$	40	$	2,020	$	22,341

Nine Months Ended September 30, 2021
Interest income		$	3,237	$	4	$	3	$	3,244
Interest expense		698		3		2		703
Provision for finance receivable losses		351		—		5		356
Net interest income after provision for finance receivable losses		2,188		1		(4)		2,185
Other revenues		395		10		(9)		396
Other expenses		1,154		17		24		1,195
Income (loss) before income tax expense (benefit)		$	1,429	$	(6)	$	(37)	$	1,386

Assets		$	19,897	$	44	$	2,022	$	21,963

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14. Fair Value Measurements

The accounting policies of our fair value measurements are the same as those disclosed in Note 2 and Note 18 of the Notes to the Consolidated Financial Statements in Part II - Item 8 included in our Annual Report.

The following table presents the carrying amounts and estimated fair values of our financial instruments and indicates the level in the fair value hierarchy of the estimated fair value measurement based on the observability of the inputs used:


		Fair Value Measurements Using						Total Fair Value				Total Carrying Value					Fair Value Measurements Using									Total Fair Value			Total Carrying Value
(dollars in millions)	(dollars in millions)	Level 1		Level 2		Level 3				(dollars in millions)				Level 1				Level 2			Level 3

September 30, 2022
September 30, 2023														September 30, 2023
Assets	Assets													Assets
Cash and cash equivalents	Cash and cash equivalents	$	536	$	—	$	—			$	536				$	536	Cash and cash equivalents		$	1,180		$	10		$	—		$	1,190		$	1,190
Investment securities	Investment securities	50		1,687		10		1,747				1,747		Investment securities			50			1,581			4			1,635			1,635
Net finance receivables, less allowance for finance receivable losses	Net finance receivables, less allowance for finance receivable losses	—		—		19,542		19,542				17,497		Net finance receivables, less allowance for finance receivable losses			—			—			20,384			20,384			18,618
Restricted cash and restricted cash equivalents	Restricted cash and restricted cash equivalents	483		—		—		483				483		Restricted cash and restricted cash equivalents			580			—			—			580			580
Other assets *	Other assets *	—		—		45		45				37		Other assets *			—			—			38			38			29

Liabilities	Liabilities													Liabilities
Long-term debt	Long-term debt	$	—	$	16,530	$	—	$	16,530			$	18,202	Long-term debt			$	—		$	18,755		$	—		$	18,755		$	19,851

December 31, 2021
December 31, 2022														December 31, 2022
Assets	Assets													Assets
Cash and cash equivalents	Cash and cash equivalents	$	535	$	6	$	—	$	541			$	541	Cash and cash equivalents			$	481		$	17		$	—		$	498		$	498
Investment securities	Investment securities	59		1,927		6		1,992				1,992		Investment securities			51			1,744			5			1,800			1,800
Net finance receivables, less allowance for finance receivable losses	Net finance receivables, less allowance for finance receivable losses	—		—		20,083		20,083				17,117		Net finance receivables, less allowance for finance receivable losses			—			—			19,272			19,272			17,675
Restricted cash and restricted cash equivalents	Restricted cash and restricted cash equivalents	476		—		—		476				476		Restricted cash and restricted cash equivalents			450			11			—			461			461
Other assets *	Other assets *	—		—		52		52				46		Other assets *			—			—			43			43			35

Liabilities	Liabilities													Liabilities
Long-term debt	Long-term debt	$	—	$	18,781	$	—	$	18,781			$	17,750	Long-term debt			$	—		$	16,969		$	—		$	16,969		$	18,281

*Other assets at September 30, ~~2022~~2023 and December 31, ~~2021~~2022 primarily consists of finance receivables held for sale.

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FAIR VALUE MEASUREMENTS — RECURRING BASIS

The following tables present information about our assets measured at fair value on a recurring basis and indicates the fair value hierarchy based on the levels of inputs we utilized to determine such fair value:


		Fair Value Measurements Using						Total Carried At Fair Value			Fair Value Measurements Using						Total Carried At Fair Value
(dollars in millions)	(dollars in millions)	Level 1		Level 2		Level 3				(dollars in millions)	Level 1		Level 2		Level 3

September 30, 2022
September 30, 2023										September 30, 2023
Assets	Assets									Assets
Cash equivalents in mutual funds	Cash equivalents in mutual funds	$	26	$	—	$	—	$	26	Cash equivalents in mutual funds	$	113	$	—	$	—	$	113

Cash equivalents in securities										Cash equivalents in securities	—		10		—		10
Investment securities:	Investment securities:									Investment securities:
Available-for-sale securities	Available-for-sale securities									Available-for-sale securities

U.S. government and government sponsored entities	U.S. government and government sponsored entities	—		11		—		11		U.S. government and government sponsored entities	—		14		—		14
Obligations of states, municipalities, and political subdivisions	Obligations of states, municipalities, and political subdivisions	—		64		—		64		Obligations of states, municipalities, and political subdivisions	—		64		—		64
Commercial paper	Commercial paper	—		53		—		53		Commercial paper	—		23		—		23
Non-U.S. government and government sponsored entities	Non-U.S. government and government sponsored entities	—		135		—		135		Non-U.S. government and government sponsored entities	—		153		—		153
Corporate debt	Corporate debt	6		1,105		3		1,114		Corporate debt	6		1,017		2		1,025
RMBS	RMBS	—		178		6		184		RMBS	—		172		—		172
CMBS	CMBS	—		36		—		36		CMBS	—		33		—		33
CDO/ABS	CDO/ABS	—		80		—		80		CDO/ABS	—		83		—		83

Total available-for-sale securities	Total available-for-sale securities	6		1,662		9		1,677		Total available-for-sale securities	6		1,559		2		1,567
Other securities	Other securities									Other securities

Bonds:	Bonds:									Bonds:

Corporate debt	Corporate debt	—		8		—		8		Corporate debt	—		5		—		5
RMBS		—		1		—		1

CDO/ABS	CDO/ABS	—		16		—		16		CDO/ABS	—		17		—		17
Total bonds	Total bonds	—		25		—		25		Total bonds	—		22		—		22
Preferred stock	Preferred stock	16		—		—		16		Preferred stock	15		—		—		15
Common stock	Common stock	28		—		1		29		Common stock	29		—		2		31

Total other securities	Total other securities	44		25		1		70		Total other securities	44		22		2		68
Total investment securities	Total investment securities	50		1,687		10		1,747		Total investment securities	50		1,581		4		1,635

Restricted cash equivalents in mutual funds	Restricted cash equivalents in mutual funds	476		—		—		476		Restricted cash equivalents in mutual funds	566		—		—		566

Total	Total	$	552	$	1,687	$	10	$	2,249	Total	$	729	$	1,591	$	4	$	2,324

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		Fair Value Measurements Using						Total Carried At Fair Value			Fair Value Measurements Using						Total Carried At Fair Value
(dollars in millions)	(dollars in millions)	Level 1		Level 2		Level 3				(dollars in millions)	Level 1		Level 2		Level 3

December 31, 2021
December 31, 2022										December 31, 2022
Assets	Assets									Assets
Cash equivalents in mutual funds	Cash equivalents in mutual funds	$	41	$	—	$	—	$	41	Cash equivalents in mutual funds	$	77	$	—	$	—	$	77
Cash equivalents in securities	Cash equivalents in securities	—		6		—		6		Cash equivalents in securities	—		17		—		17
Investment securities:	Investment securities:									Investment securities:
Available-for-sale securities	Available-for-sale securities									Available-for-sale securities

U.S. government and government sponsored entities	U.S. government and government sponsored entities	—		16		—		16		U.S. government and government sponsored entities	—		16		—		16
Obligations of states, municipalities, and political subdivisions	Obligations of states, municipalities, and political subdivisions	—		79		—		79		Obligations of states, municipalities, and political subdivisions	—		66		—		66
Commercial paper	Commercial paper	—		50		—		50		Commercial paper	—		55		—		55
Non-U.S. government and government sponsored entities	Non-U.S. government and government sponsored entities	—		155		—		155		Non-U.S. government and government sponsored entities	—		142		—		142
Corporate debt	Corporate debt	5		1,292		5		1,302		Corporate debt	5		1,129		3		1,137
RMBS	RMBS	—		170		—		170		RMBS	—		192		—		192
CMBS	CMBS	—		45		—		45		CMBS	—		35		—		35
CDO/ABS	CDO/ABS	—		90		—		90		CDO/ABS	—		86		—		86

Total available-for-sale securities	Total available-for-sale securities	5		1,897		5		1,907		Total available-for-sale securities	5		1,721		3		1,729
Other securities	Other securities									Other securities

Bonds:	Bonds:									Bonds:

Corporate debt	Corporate debt	—		9		—		9		Corporate debt	—		6		—		6
RMBS	RMBS	—		1		—		1		RMBS	—		1		—		1

CDO/ABS	CDO/ABS	—		20		—		20		CDO/ABS	—		16		—		16
Total bonds	Total bonds	—		30		—		30		Total bonds	—		23		—		23
Preferred stock	Preferred stock	22		—		—		22		Preferred stock	15		—		—		15
Common stock	Common stock	32		—		1		33		Common stock	31		—		2		33

Total other securities	Total other securities	54		30		1		85		Total other securities	46		23		2		71
Total investment securities	Total investment securities	59		1,927		6		1,992		Total investment securities	51		1,744		5		1,800
Restricted cash equivalents in mutual funds	Restricted cash equivalents in mutual funds	468		—		—		468		Restricted cash equivalents in mutual funds	445		—		—		445
Restricted cash equivalents in securities										Restricted cash equivalents in securities	—		11		—		11
Total	Total	$	568	$	1,933	$	6	$	2,507	Total	$	573	$	1,772	$	5	$	2,350

Due to the insignificant activity within the Level 3 assets during the three and nine months ended September 30, ~~2022~~2023 and ~~2021,~~2022, we have omitted the additional disclosures relating to the changes in Level 3 assets measured at fair value on a recurring basis and the quantitative information about Level 3 unobservable inputs.

FAIR VALUE MEASUREMENTS — NON-RECURRING BASIS

We measure the fair value of certain assets on a non-recurring basis when events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. Net impairment charges recorded on assets measured at fair value on a non-recurring basis were immaterial during the three and nine months ended September 30, ~~2022~~2023 and ~~2021.~~2022.

FAIR VALUE MEASUREMENTS — VALUATION METHODOLOGIES AND ASSUMPTIONS

See Note 18 of the Notes to the Consolidated Financial Statements in Part II - Item 8 included in our Annual Report for information regarding our methods and assumptions used to estimate fair value.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

An index to our management’s discussion and analysis follows:

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Forward-Looking Statements

This report contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not statements of historical fact, but instead represent only management’s current beliefs regarding future events. By their nature, forward-looking statements are subject to risks, uncertainties, assumptions, and other important factors that may cause actual results, performance, or achievements to differ materially from those expressed in or implied by such forward-looking statements. We caution you not to place undue reliance on these forward-looking statements, which speak only as of the date they were made. We do not undertake any obligation to update or revise these forward-looking statements to reflect events or circumstances after the date of this report or to reflect the occurrence of unanticipated events or the non-occurrence of anticipated events, whether as a result of new information, future developments, or otherwise, except as required by law. Forward-looking statements include, without limitation, statements concerning future plans, objectives, goals, projections, strategies, events, or performance, and underlying assumptions and other statements related thereto. Statements preceded by, followed by or that otherwise include the words “anticipates,” “appears,” ~~“are likely,”~~ “assumes,” “believes,” “can,” “continues,” “could,” “estimates,” “expects,” “forecasts,” “foresees,” “goals,” “intends,” “likely,” “objective,” “plans,” “projects,” “target,” “trend,” “remains,” and similar expressions or future or conditional verbs such as “could,” “may,” “might,” “should,” “will,” or “would” are intended to identify forward-looking statements, but these words are not the exclusive means of identifying forward-looking statements. Important factors that could cause actual results, performance, or achievements to differ materially from those expressed in or implied by forward-looking statements include, without limitation, the following:

•adverse changes and volatility in general economic conditions, including the interest rate environment and the financial markets;

•~~risks associated with the coronavirus (“COVID-19”) pandemic and the measures taken in response thereto;~~

•~~geopolitical risks, including recent geopolitical actions outside the U.S.;~~

•the sufficiency of our allowance for finance receivable losses;

•increased levels of unemployment and personal bankruptcies;

•the current inflationary environment and related trends affecting our customers;

•natural or accidental events such as earthquakes, hurricanes, pandemics, floods, or wildfires affecting our customers, collateral, or our facilities;

•a failure in or breach of our information, operational or security systems, or infrastructure or those of third parties, including as a result of cyber-attacks, war, or other disruptions;

•the adequacy of our credit risk scoring models;

•adverse changes in our ability to attract and retain employees or key executives;

•increased competition or adverse changes in customer responsiveness to our distribution channels or products;

•changes in federal, state, or local laws, regulations, or regulatory policies and practices or increased regulatory scrutiny of our business or industry;

•risks associated with our insurance operations;

•~~the current inflationary environment and related trends affecting our customers;~~

•the costs and effects of any actual or alleged violations of any federal, state, or local laws, rules or regulations;

•the costs and effects of any fines, penalties, judgments, decrees, orders, inquiries, investigations, subpoenas, or enforcement or other proceedings of any governmental or quasi-governmental agency or authority;

•our substantial indebtedness and our continued ability to access the capital markets and maintain adequate current sources of funds to satisfy our cash flow requirements;

•our ability to comply with all of our covenants; and

•the effects of any downgrade of our debt ratings by credit rating agencies.

We also direct readers to the other risks and uncertainties discussed in Part I - Item 1A. “Risk Factors” included in our Annual Report and in other documents we file with the SEC.

If one or more of these or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, our actual results may vary materially from what we may have expressed or implied by these forward-looking statements. You should specifically consider the factors identified in this report and in the documents we file with the SEC that could cause actual results to differ before making an investment decision to purchase our securities and should not place undue reliance on any of our forward-looking statements. Furthermore, new risks and uncertainties arise from time to time, and it is impossible for us to predict those events or how they may affect us.

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Overview

We are the leader in offering nonprime customers responsible access to credit. Our customers are hardworking Americans who have been largely underserved by traditional lenders such as banks and credit unions. We believe our customers deserve fair and responsible access to credit, and we empower them to solve today’s problems and reach a better financial future through our personalized solutions.

We operate in the United States and market our personal loans in 44 states. We service the loans that we originate and retain on our balance sheet, as well as loans owned by third parties on their behalf in connection with our whole loan sale program and legacy businesses. In ~~the third quarter of 2021, we began offering~~connection with our offerings, our insurance subsidiaries offer our personal loan customers optional credit and non-credit insurance, and other insurance-related products. We also offer two credit cards, BrightWay and BrightWay+, which are designed to reward customers for responsible credit activity such as consistent on-time payments. We continue to expand BrightWay and BrightWay+ credit cards across our branch network, through direct mail, and through our digital affiliates. In connection with our offerings, our insurance subsidiaries offer our personal loan customers optional credit and non-credit insurance, and other insurance-related products. We strive to meet our customers at their preferred channel and to deliver a seamless customer experience through our digital platforms, distribution partnerships, or working with our expert team members at our approximately 1,400 locations. Our personal loans, credit cards, and other products help customers meet everyday needs and take steps to improve their financial well-being.

In addition to our loan originations, insurance, and other product sales activities, we also service the loans that we originate and retain on our balance sheet, as well as loans owned by third parties on their behalf in connection with our whole loan sale program and legacy businesses. We also pursue strategic acquisitions and dispositions of assets and businesses, including loan portfolios or other financial assets, and may establish joint ventures or enter into other strategic alliances.

OUR PRODUCTS

Our product offerings include:

•Personal Loans — We offer personal loans through our branch network, centralized operations, distribution partnerships, and our website, www.omf.com, to customers who need timely access to cash. Our personal loans are non-revolving, with a fixed rate, have fixed terms generally between three and six years, and are secured by automobiles, other titled collateral, or are unsecured. At September 30, ~~2022,~~2023, we had approximately ~~2.34~~2.40 million personal loans totaling ~~$19.7~~$20.8 billion of net finance receivables, of which ~~52%~~50% were secured by titled property, compared to approximately ~~2.34~~2.33 million personal loans totaling ~~$19.2~~$19.9 billion of net finance receivables, of which 52% were secured by titled property at December 31, ~~2021.~~2022. We also service personal loans for our whole loan sale partners.

•Credit Cards — ~~In the third quarter of 2021, we began offering~~BrightWay and BrightWay+ credit cards originate through a third-party bank partner from which we purchase the receivable balances. The credit cards are offered ~~through~~across our branch network, through direct mail, ~~marketing,~~ and ~~direct-to-consumer via~~through our digital affiliates. Credit cards are open-ended, revolving, with a fixed rate, and are unsecured. At September 30, ~~2022,~~2023, we had approximately ~~104~~339 thousand open credit card customer accounts, totaling ~~$79~~$232 million of net finance receivables, compared to approximately 66135 thousand open credit card customer accounts, totaling ~~$25~~$107 million of net finance receivables at December 31, ~~2021.~~2022.

•Optional Insurance Products — We offer our customers optional credit insurance products (life, disability, and involuntary unemployment insurance) and optional non-credit insurance products through both our branch network and our ~~centralized~~central operations. Credit insurance and non-credit insurance products are provided by our affiliated insurance companies. We offer ~~GAP~~Guaranteed Asset Protection (“GAP”) coverage as a waiver product or insurance. We also offer optional membership plans from an unaffiliated company.

~~Our non-originating legacy products include:~~

•~~Other Receivables —~~ We ceased originating real estate loans in 2012 and we continue to service or sub-service liquidating real estate loans. Our real estate loans held for sale are reported in “Other assets” of our consolidated balance sheets.

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OUR SEGMENT

At September 30, ~~2022,~~2023, Consumer and Insurance (“C&I”) is our only reportable segment, which includes personal loans, credit cards, and optional insurance products. At September 30, ~~2022,~~2023, we managed a combined total of ~~2.53~~2.84 million customer accounts and ~~$20.5~~$21.9 billion of managed receivables, compared to ~~2.45~~2.56 million customer accounts and ~~$19.6~~$20.8 billion of managed receivables at December 31, ~~2021.~~2022.

The remaining components (which we refer to as “Other”) consist of our liquidating SpringCastle Portfolio servicing activity and our non-originating legacy operations, which primarily include our liquidating real estate ~~loans.~~loans held for sale and reported in Other assets in our condensed consolidated balance sheets. See Note 13 of the Notes to the Condensed Consolidated Financial Statements included in this report for more information about our segment.

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Recent Developments and Outlook

RECENT DEVELOPMENTS

Issuance of 9.00% Senior Notes Due 2029

On June 22, 2023, OMFC issued a total of $500 million aggregate principal amount of 9.00% Senior Notes due 2029.

For information regarding the issuance of our unsecured debt, see “Liquidity and Capital Resources” under Management’s Discussion and Analysis of Financial Condition and Results of Operations in this report.

Securitization Transactions Completed - ODART 2023-1, OMFIT 2023-1, and OMFIT 2023-2

For information regarding the issuances of our secured debt, see “Liquidity and Capital Resources” under Management’s Discussion and Analysis of Financial Condition and Results of Operations in this report.

Stock Repurchase Program

On February 2, 2022, the Board authorized a stock repurchase program, which allows us to repurchase up to $1.0 billion of OMH’s outstanding common stock, excluding fees, commissions, and other expenses related to the repurchases. The authorization expires on December 31, 2024. As of September 30, ~~2022,~~2023, we had ~~$782~~$681 million of authorized share repurchase capacity, excluding fees and commissions, remaining under the program.

See “Liquidity and Capital Resources” under Management’s Discussion and Analysis of Financial Condition and Results of Operations and Item 2. Unregistered Sales of Equity Securities and Use of Proceeds in Part II of this report for further information on our shares repurchased.

~~Social Securitization Transaction - OMFIT 2022-S1~~

As part of our continued commitment to improve the financial well-being of hardworking Americans, on April 27, 2022, OMFC completed its first social securitization under Rule 144A. We issued $600 million principal amount of notes backed by personal loans (“OMFIT 2022-S1”) made to the target population identified in the OneMain 2022 ABS Social Framework. OMFIT 2022-S1 has a revolving period of three years, during which no principal payments are required. Generally, the target population is comprised of borrowers residing in rural communities (by zip code), 75% of whom are lower income borrowers in these communities. Through the OneMain 2022 ABS Social Bond Framework we aim to promote financial inclusion to the target population by providing equitable access to fair and transparent credit. The OneMain 2022 ABS Social Bond Framework, which is available on OneMain’s Investor Relations website, aligns to the Social Bond Principles 2021, as administered by the International Capital Market Association.

~~Private Secured Term Funding~~

On April 25, 2022, OMFC entered into a $350 million private secured term funding collateralized by our personal loans. No principal payments are required to be made during the first three years, followed by a subsequent one-year amortization period at the expiration of which the outstanding principal amount is due and payable.

~~Securitization Transactions Completed - ODART 2022-1 and OMFIT 2022-2~~

~~Redemption of 8.875% Senior Notes Due 2025~~

~~On June 1, 2022, OMFC paid a net aggregate amount of $637 million, inclusive of accrued interest and premiums, to complete the redemption of its 8.875% Senior Notes due 2025.~~

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~~Unsecured Corporate Revolver~~

~~On June 15, 2022, OMFC increased the total maximum borrowing capacity of its unsecured corporate revolver to $1.25 billion. At September 30, 2022, no amounts were drawn under this facility.~~

~~For further information regarding the redemption of our unsecured debt and our corporate revolver, see Note 6 of the Notes to the Condensed Consolidated Financial Statements included in this report.~~

Cash Dividends to OMH's Common Stockholders

For information regarding the quarterly dividends declared by OMH, see “Liquidity and Capital Resources” under Management’s Discussion and Analysis of Financial Condition and Results of Operations in this report.

~~Election and Resignation of Members of the OMH Board of Directors~~Regulatory Settlements

On ~~January 27, 2022, Toos N. Daruvala was elected~~May 24, 2023, we entered into a consent order with the New York State Department of Financial Services (“NYDFS”) relating primarily to a past examination of our cybersecurity policies from 2017 to early 2020. Pursuant to the ~~OMH Board of Directors, effective February 14, 2022.~~consent order, we agreed to pay a $4.25 million civil penalty and represent that certain improvements to our cybersecurity controls and procedures had previously been completed.

~~On February 24, 2022, Peter B. Sinensky resigned from~~Additionally, on May 31, 2023, we entered into a consent order with the ~~OMH Board of Directors.~~

~~Management’s Response~~CFPB to resolve a previously disclosed investigation focused on certain refunding practices for optional insurance and membership plan products that were subsequently canceled by the consumer after purchase. Pursuant to the ~~COVID-19 Pandemic~~consent order, we agreed to issue $10 million in interest refunds to affected customers, pay a $10 million civil penalty and make certain other enhancements to our sales and refunding practices.

In ~~early 2020, COVID-19 evolved into a global pandemic, resulting in widespread volatility and deterioration in economic conditions across~~agreeing to these two consent orders, we did not admit to any of the ~~states and regions that we serve. Throughout~~NYDFS’ or the pandemic, we have maintained our focus on assisting and supporting our customers, while remaining committed to the safety of our employees. We continue to serve our customers by keeping our branch locations open with appropriate protective protocols in place and through our digital platform. This hybrid capability has sustained our operating performance through the pandemic and enabled us to serve and support our customers effectively.CFPB’s factual findings or legal conclusions.

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OUTLOOK

We are actively monitoring the current ~~macroeconomic developments, including recent geopolitical actions outside of the U.S.,~~macro environment and remain prepared for any ~~additional opportunities or challenges~~developments that may impact our business. Our financial condition and results of operations could be affected by macroeconomic conditions, including changes in unemployment, inflation, interest rates, and consumer confidence. We will continue to incorporate updates to our macroeconomic assumptions, as necessary, which could lead to further adjustments in our allowance for finance receivable losses, allowance ratio, and provision for finance receivable losses.

Our cumulative investments in our digital capabilities, combined with our proprietary data and advanced analytics, have allowed us to serve our customers through the branch, over the phone, and remotely throughout the pandemic and into the future.

~~Our~~ experienced management team ~~continues to remain~~remains focused on maintaining a ~~solid~~strong balance sheet with a ~~strong~~long liquidity runway and adequate capital ~~coverage, upholding~~and maintaining a conservative and disciplined underwriting ~~model, and building strong relationships with our customers to ensure that we are serving them well.~~model. We believe we are well positioned to serve our customers, invest in our business, and drive long-term growth to create value for our stockholders as we navigate ~~the evolving~~an ever-evolving economic, social, political, and regulatory environment.

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Results of Operations

The results of OMFC are consolidated into the results of OMH. Due to the nominal differences between OMFC and OMH, content throughout this section relates only to OMH. See Note 1 of the Notes to the Condensed Consolidated Financial Statements included in this report for further information.

OMH'S CONSOLIDATED RESULTS

See the table below for OMH's consolidated operating results and selected financial statistics. A further discussion of OMH's operating results for our operating segment is provided under “Segment Results” below.


		At or for the Three Months Ended September 30,						At or for the Nine Months Ended September 30,							At or for the Three Months Ended September 30,						At or for the Nine Months Ended September 30,
(dollars in millions, except per share amounts)	(dollars in millions, except per share amounts)	2022			2021			2022			2021			(dollars in millions, except per share amounts)	2023			2022			2023			2022

Interest income	Interest income	$	1,118		$	1,113		$	3,313		$	3,244		Interest income	$	1,167		$	1,118		$	3,377		$	3,313
Interest expense	Interest expense	223			237			661			703			Interest expense	267			223			749			661
Provision for finance receivable losses	Provision for finance receivable losses	421			226			998			356			Provision for finance receivable losses	410			421			1,275			998
Net interest income after provision for finance receivable losses	Net interest income after provision for finance receivable losses	474			650			1,654			2,185			Net interest income after provision for finance receivable losses	490			474			1,353			1,654

Other revenues	Other revenues	170			155			460			396			Other revenues	185			170			548			460
Other expenses	Other expenses	394			429			1,188			1,195			Other expenses	429			398			1,282			1,191
Income before income taxes	Income before income taxes	250			376			926			1,386			Income before income taxes	246			246			619			923
Income taxes	Income taxes	62			88			228			335			Income taxes	52			61			143			227
Net income	Net income	$	188		$	288		$	698		$	1,051		Net income	$	194		$	185		$	476		$	696

Share Data:	Share Data:													Share Data:

Earnings per share:	Earnings per share:													Earnings per share:

Diluted	Diluted	$	1.52		$	2.17		$	5.57		$	7.84		Diluted	$	1.61		$	1.49		$	3.94		$	5.55

Selected Financial Statistics (a)
Selected Financial Statistics *														Selected Financial Statistics *
Total finance receivables:	Total finance receivables:													Total finance receivables:
Net finance receivables	Net finance receivables	$	19,752		$	18,843		$	19,752		$	18,843		Net finance receivables	$	21,067		$	19,752		$	21,067		$	19,752
Average net receivables	Average net receivables	$	19,623		$	18,545		$	19,289		$	18,029		Average net receivables	$	20,832		$	19,623		$	20,282		$	19,289
Yield		22.57		%	23.79		%	22.94		%	24.02		%

Gross charge-off ratio	Gross charge-off ratio	7.12		%	4.76		%	7.15		%	5.41		%	Gross charge-off ratio	7.94		%	7.12		%	8.70		%	7.15		%
Recovery ratio	Recovery ratio	(1.20)		%	(1.24)		%	(1.34)		%	(1.23)		%	Recovery ratio	(1.20)		%	(1.20)		%	(1.31)		%	(1.34)		%
Net charge-off ratio	Net charge-off ratio	5.92		%	3.52		%	5.81		%	4.19		%	Net charge-off ratio	6.74		%	5.92		%	7.39		%	5.81		%

Personal loans:	Personal loans:													Personal loans:

Net finance receivables	Net finance receivables	$	19,673		$	18,843		$	19,673		$	18,843		Net finance receivables	$	20,835		$	19,673		$	20,835		$	19,673
Yield														Yield	22.20		%	22.57		%	22.23		%	22.93		%
Origination volume	Origination volume	$	3,551		$	3,870		$	10,406		$	9,989		Origination volume	$	3,278		$	3,551		$	9,837		$	10,406
Number of accounts	Number of accounts	2,342,080			2,333,941			2,342,080			2,333,941			Number of accounts	2,400,740			2,342,080			2,400,740			2,342,080
Number of accounts originated	Number of accounts originated	353,932			404,148			1,036,225			1,018,470			Number of accounts originated	332,298			353,932			961,619			1,036,225
Net charge-off ratio														Net charge-off ratio	6.68		%	5.89		%	7.32		%	5.81		%
30-89 Delinquency ratio	30-89 Delinquency ratio	2.81		%	2.20		%	2.81		%	2.20		%	30-89 Delinquency ratio	2.98		%	2.81		%	2.98		%	2.81		%
Credit cards (b):
Credit cards:														Credit cards:
Net finance receivables	Net finance receivables	$	79		$	—		$	79		$	—		Net finance receivables	$	232		$	79		$	232		$	79

Purchase volume	Purchase volume	$	38		$	—		$	116		$	—		Purchase volume	$	131		$	38		$	265		$	116
Number of open accounts	Number of open accounts	104,327			—			104,327			—			Number of open accounts	339,446			104,327			339,446			104,327
30-89 Delinquency ratio		6.58		%	—		%	6.58		%	—		%

Debt balances:	Debt balances:													Debt balances:
Long-term debt balance	Long-term debt balance	$	18,202		$	17,661		$	18,202		$	17,661		Long-term debt balance	$	19,851		$	18,202		$	19,851		$	18,202
Average daily debt balance	Average daily debt balance	$	18,004		$	17,680		$	17,750		$	17,192		Average daily debt balance	$	19,607		$	18,004		$	18,833		$	17,750

~~(a)~~* See “Glossary” at the beginning of this report for formulas and definitions of our key performance ratios.

~~(b) The amounts associated with credit cards for the three and nine months ended September 30, 2021 were immaterial, as the product offering began in the third quarter of 2021.~~

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Comparison of Consolidated Results for ~~the~~ Three and Nine Months Ended September 30, ~~2022~~2023 and ~~2021~~2022

Interest income increased $5$49 million ~~less than 1%,~~or 4% and ~~$69~~$64 million or 2% for the three and nine months ended September 30, ~~2022,~~2023, respectively, when compared to the same periods in ~~2021~~2022 primarily due to growth in ~~our loan portfolio,~~average net receivables, partially offset by lower yield.

Interest expense ~~decreased $14~~increased $44 million or 6%20% and ~~$42~~$88 million or 6%13% for the three and nine months ended September 30, ~~2022,~~2023, respectively, when compared to the same periods in ~~2021~~2022 primarily due to a ~~lower~~higher average cost of funds ~~partially offset by~~and an increase in average debt.

See Notes 6 and 7 of the Notes to the Condensed Consolidated Financial Statements included in this report for further information on our long-term debt, securitization transactions, private secured term funding, and our revolving conduit facilities.

Provision for finance receivable losses ~~increased $195~~decreased $11 million or ~~86% and $642 million or 180%~~2% for the three ~~and nine~~ months ended September 30, ~~2022, respectively,~~2023 when compared to the same ~~periods~~period in ~~2021~~2022 primarily driven by ~~higher net charge-offs and an increase~~a larger build in the allowance for finance receivable losses ~~due~~in the prior year quarter, partially offset by higher net charge-offs.

Provision for finance receivable losses increased $277 million or 28% for the nine months ended September 30, 2023 when compared to the ~~weakened macroeconomic environment and growth~~same period in ~~the portfolio.~~2022 primarily driven by higher net charge-offs.

Other revenues increased $15 million or ~~10%~~9% and ~~$64~~$88 million or ~~16%~~19% for the three and nine months ended September 30, ~~2022,~~2023, respectively, when compared to the same periods in ~~2021~~2022 primarily due to an increase in ~~gains~~investment revenue due to higher market rates compared to the prior year period and a net loss on the ~~sales of finance receivables~~repurchase and ~~an increase in servicing revenue associated with the whole loan sale program as a result of more loans sold in the current period and lower net losses on the repurchases and repayments~~repayment of debt in ~~the current period compared to~~ the prior year period.

Other expenses ~~decreased $35~~increased $31 million or 8% for the three months ended September 30, ~~2022~~2023 when compared to the same period in ~~2021~~2022 primarily due to ~~a decrease~~an increase in general operating expenses driven by growth in our receivables and our strategic investments in the business, as well as an increase in insurance policy and benefits claims expense due to favorable ~~development of credit life~~ claims ~~and cash-settled stock-based awards expense~~experience in the prior ~~year~~ period ~~partially offset by an increase~~not present in ~~salaries and benefits driven by~~ the ~~continued investment in our business.~~current period.

Other expenses ~~decreased $7~~increased $91 million ~~less than 1%,~~or 8% for the nine months ended September 30, ~~2022~~2023 when compared to the same period in ~~2021~~2022 primarily due to ~~a decrease~~regulatory settlements in the current period, an increase in general operating expenses driven by growth in our receivables and our strategic investments in the business, as well as an increase in insurance policy and benefits claims expense ~~due to~~largely driven by favorable ~~development of credit life, credit disability, and term life~~ claims ~~and cash-settled stock-based awards expense~~experience in the prior ~~year~~ period ~~offset by an increase~~not present in ~~salaries and benefits driven by~~ the ~~continued investment in our business.~~current period.

Income taxes totaled ~~$62~~$52 million and ~~$228~~$143 million for the three and nine months ended September 30, 2023, respectively, compared to $61 million and $227 million for the three and nine months ended September 30, 2022, respectively, due to higher pre-tax income in the prior year period. For the three and nine months ended September 30, 2023, the effective tax rates were 21.0% and 23.1%, respectively, compared to ~~$88 million~~24.7% and ~~$335 million~~24.6% for the three and nine months ended September 30, ~~2021, respectively, due to higher pre-tax income in the prior year period.~~

~~For the three and nine months ended September 30,~~ 2022, ~~the effective tax rates were 24.7% and 24.6%, respectively, compared to 23.5% and 24.2% for the three and nine months ended September 30, 2021,~~ respectively. The effective tax rates differed from the federal statutory rate of 21% primarily due to the effect of state income taxes. ~~See Note 11 of the Notes to the Condensed Consolidated Financial Statements included in this report for further information on effective tax rates.~~

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NON-GAAP FINANCIAL MEASURES

Management uses C&I adjusted pretax income (loss), a non-GAAP financial measure, as a key performance measure of our segment. C&I adjusted pretax income (loss) represents income (loss) before income taxes on a Segment Accounting Basis and excludes ~~the expense associated with the~~regulatory settlements, net gain or loss resulting from repurchases and repayments of debt, the expense associated with cash-settled stock-based awards, and other items and strategic activities, which include direct costs associated with COVID-19 and restructuring charges. Management believes C&I adjusted pretax income (loss) is useful in assessing the profitability of our segment.

Management also uses C&I pretax capital generation, a non-GAAP financial measure, as a key performance measure of our segment. This measure represents C&I adjusted pretax income as discussed above and excludes the change in our C&I allowance for finance receivable losses in the period while still considering the C&I net charge-offs incurred during the period. Management believes that C&I pretax capital generation is useful in assessing the capital created in the period impacting the overall capital adequacy of the Company. Management believes that the Company’s reserves, combined with its equity, represent the Company’s loss absorption capacity.

Management utilizes both C&I adjusted pretax income (loss) and C&I pretax capital generation in evaluating our performance. Additionally, both of these non-GAAP measures are consistent with the performance goals established in OMH’s executive compensation program. C&I adjusted pretax income (loss) and C&I pretax capital generation are non-GAAP financial measures and should be considered supplemental to, but not as a substitute for or superior to, income (loss) before income taxes, net income, or other measures of financial performance prepared in accordance with GAAP.

OMH's reconciliations of income before income tax expense on a Segment Accounting Basis to C&I adjusted pretax income (non-GAAP) and C&I pretax capital generation (non-GAAP) were as follows:


		Three Months Ended September 30,				Nine Months Ended September 30,				Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in millions)	(dollars in millions)	2022		2021		2022		2021			(dollars in millions)	2023		2022		2023		2022

Consumer and Insurance	Consumer and Insurance										Consumer and Insurance
Income before income taxes - Segment Accounting Basis	Income before income taxes - Segment Accounting Basis	$	251	$	388	$	928	$	1,429		Income before income taxes - Segment Accounting Basis	$	250	$	247	$	624	$	925
Adjustments:	Adjustments:										Adjustments:
Regulatory settlements											Regulatory settlements	—		—		24		—
Net (gain) loss on repurchases and repayments of debt	Net (gain) loss on repurchases and repayments of debt	(3)		1		25		40			Net (gain) loss on repurchases and repayments of debt	—		(3)		(1)		25
Cash-settled stock-based awards		(2)		31		1		31
Direct costs associated with COVID-19		1		1		3		5

Restructuring charges		3		—		2		—
Cash-settled stock-based awards											Cash-settled stock-based awards	—		(2)		1		1
Other											Other	2		4		3		5

Adjusted pretax income (non-GAAP)	Adjusted pretax income (non-GAAP)	250		421		959		1,505			Adjusted pretax income (non-GAAP)	252		246		651		956

Provision for finance receivable losses	Provision for finance receivable losses	420		224		995		351			Provision for finance receivable losses	410		420		1,275		995
Net charge-offs	Net charge-offs	(293)		(165)		(838)		(564)			Net charge-offs	(353)		(293)		(1,121)		(838)
Pretax capital generation (non-GAAP)	Pretax capital generation (non-GAAP)	$	377	$	480	$	1,116	$	1,292		Pretax capital generation (non-GAAP)	$	309	$	373	$	805	$	1,113

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Segment Results

The results of OMFC are consolidated into the results of OMH. Due to the nominal differences between OMFC and OMH, content throughout this section relate only to OMH. See Note 1 of the Notes to the Condensed Consolidated Financial Statements included in this report for further information.

See Note 17 of the Notes to the Consolidated Financial Statements in Part II - Item 8 included in our Annual Report for a description of our segment and methodologies used to allocate revenues and expenses to our C&I segment. See Note 13 of the Notes to the Condensed Consolidated Financial Statements included in this report for reconciliations of segment total to condensed consolidated financial statement amounts.

CONSUMER AND INSURANCE

OMH's adjusted pretax income and selected financial statistics for C&I on an adjusted Segment Accounting Basis were as follows:


		At or for the Three Months Ended September 30,						At or for the Nine Months Ended September 30,							At or for the Three Months Ended September 30,						At or for the Nine Months Ended September 30,
(dollars in millions)	(dollars in millions)	2022			2021			2022			2021			(dollars in millions)	2023			2022			2023			2022

Interest income	Interest income	$	1,116		$	1,111		$	3,308		$	3,237		Interest income	$	1,166		$	1,116		$	3,373		$	3,308
Interest expense	Interest expense	221			235			657			698			Interest expense	265			221			744			657
Provision for finance receivable losses	Provision for finance receivable losses	420			224			995			351			Provision for finance receivable losses	410			420			1,275			995
Net interest income after provision for finance receivable losses	Net interest income after provision for finance receivable losses	475			652			1,656			2,188			Net interest income after provision for finance receivable losses	491			475			1,354			1,656
Other revenues	Other revenues	165			152			476			435			Other revenues	182			165			542			476
Other expenses	Other expenses	390			383			1,173			1,118			Other expenses	421			394			1,245			1,176
Adjusted pretax income (non-GAAP)	Adjusted pretax income (non-GAAP)	$	250		$	421		$	959		$	1,505		Adjusted pretax income (non-GAAP)	$	252		$	246		$	651		$	956

Selected Financial Statistics (a)
Selected Financial Statistics *														Selected Financial Statistics *
Total finance receivables:	Total finance receivables:													Total finance receivables:
Net finance receivables	Net finance receivables	$	19,754		$	18,847		$	19,754		$	18,847		Net finance receivables	$	21,068		$	19,754		$	21,068		$	19,754

Average net receivables	Average net receivables	$	19,624		$	18,549		$	19,291		$	18,034		Average net receivables	$	20,833		$	19,624		$	20,283		$	19,291
Yield		22.57		%	23.77		%	22.93		%	24.00		%

Gross charge-off ratio	Gross charge-off ratio	7.12		%	4.77		%	7.15		%	5.41		%	Gross charge-off ratio	7.94		%	7.12		%	8.71		%	7.15		%
Recovery ratio	Recovery ratio	(1.20)		%	(1.24)		%	(1.34)		%	(1.22)		%	Recovery ratio	(1.20)		%	(1.20)		%	(1.31)		%	(1.34)		%
Net charge-off ratio	Net charge-off ratio	5.92		%	3.52		%	5.81		%	4.19		%	Net charge-off ratio	6.74		%	5.92		%	7.39		%	5.81		%

Personal loans:	Personal loans:													Personal loans:
Net finance receivables	Net finance receivables	$	19,675		$	18,847		$	19,675		$	18,847		Net finance receivables	$	20,836		$	19,675		$	20,836		$	19,675
Yield														Yield	22.20		%	22.57		%	22.23		%	22.92		%
Origination volume	Origination volume	$	3,551		$	3,870		$	10,406		$	9,989		Origination volume	$	3,278		$	3,551		$	9,837		$	10,406
Number of accounts	Number of accounts	2,342,080			2,333,941			2,342,080			2,333,941			Number of accounts	2,400,740			2,342,080			2,400,740			2,342,080
Number of accounts originated	Number of accounts originated	353,932			404,148			1,036,225			1,018,470			Number of accounts originated	332,298			353,932			961,619			1,036,225
Net charge-off ratio														Net charge-off ratio	6.68		%	5.89		%	7.32		%	5.81		%
30-89 Delinquency ratio	30-89 Delinquency ratio	2.81		%	2.20		%	2.81		%	2.20		%	30-89 Delinquency ratio	2.98		%	2.81		%	2.98		%	2.81		%
Credit cards (b):
Credit cards:														Credit cards:
Net finance receivables	Net finance receivables	$	79		$	—		$	79		$	—		Net finance receivables	$	232		$	79		$	232		$	79

Purchase volume	Purchase volume	$	38		$	—		$	116		$	—		Purchase volume	$	131		$	38		$	265		$	116
Number of open accounts	Number of open accounts	104,327			—			104,327			—			Number of open accounts	339,446			104,327			339,446			104,327
30-89 Delinquency ratio		6.58		%	—		%	6.58		%	—		%

~~(a)~~* See “Glossary” at the beginning of this report for formulas and definitions of our key performance ratios.

~~(b) The amounts associated with credit cards for the three and nine months ended September 30, 2021 were immaterial, as the product offering began in the third quarter of 2021.~~

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Comparison of Adjusted Pretax Income for ~~the~~ Three and Nine Months Ended September 30, ~~2022~~2023 and ~~2021~~2022

Interest income increased $5$50 million ~~less than 1%~~or 4% and ~~$71~~$65 million or 2% for the three and nine months ended September 30, ~~2022,~~2023, respectively, when compared to the same periods in ~~2021~~2022 primarily due to growth in ~~our loan portfolio,~~average net receivables, partially offset by lower yield.

Interest expense ~~decreased $14~~increased $44 million or 6%20% and ~~$41~~$87 million or 6%13% for the three and nine months ended September 30, ~~2022,~~2023, respectively, when compared to the same periods in ~~2021~~2022 primarily due to a ~~lower~~higher average cost of funds ~~partially offset by~~and an increase in average debt.

Provision for finance receivable losses increased $196 million or 87% and $644 million or 183% for the three and nine months ended September 30, 2022, respectively, when compared to the same periods in 2021 primarily driven by higher net-charge offs and an increase in the allowance for finance receivable losses due to the weakened macroeconomic environment and growth in the portfolio.

~~Other revenues~~ increased $13 million or 8% and $41 million or 9% for the three and nine months ended September 30, 2022, respectively, when compared to the same periods in 2021 primarily due to an increase in gains on the sales of finance receivables and an increase in servicing revenue associated with the whole loan sale program as a result of more loans sold in the current period.

~~Other expenses~~ ~~increased $7~~decreased $10 million or 2% for the three months ended September 30, ~~2022~~2023 when compared to the same period in ~~2021~~2022 primarily driven by a larger build in the allowance for finance receivable losses in the prior year quarter, partially offset by higher net charge-offs.

Provision for finance receivable losses increased $280 million or 28% for the nine months ended September 30, 2023 when compared to the same period in 2022 primarily driven by higher net charge-offs.

Other revenues increased $17 million or 12% and $66 million or 14% for the three and nine months ended September 30, 2023, respectively, when compared to the same periods in 2022 primarily due to an increase in ~~salaries~~investment revenue due to higher market rates compared to the prior year period.

Other expenses increased $27 million or 7% and ~~benefits~~for the three months ended September 30, 2023 when compared to the same period in 2022 primarily due to an increase in general operating expenses driven by ~~the continued investment~~growth in our receivables and our strategic investments in the business, ~~offset by a decrease~~as well as an increase in insurance policy benefits and ~~benefits~~ claims expense due to favorable ~~development of credit life claims.~~claims experience in the prior period not present in the current period.

Other expenses increased ~~$55~~$69 million or 5%6% for the nine months ended September 30, ~~2022~~2023 when compared to the same period in ~~2021~~2022 primarily due to an increase in ~~salaries~~general operating expenses driven by growth in our receivables and ~~benefits and~~our strategic investments in the business, as well as an increase in ~~general operating expenses due to the continued investment in our business. The increase was offset by a decrease in~~ insurance policy benefits and ~~benefits~~ claims expense ~~due to~~largely driven by favorable ~~development of credit life, credit disability, and term life claims.~~claims experience in the prior period not present in the current period.

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Credit Quality

FINANCE RECEIVABLES

Our net finance receivables, consisting of personal loans and credit cards, were ~~$19.8~~$21.1 billion at September 30, ~~2022~~2023 and ~~$19.2~~$20.0 billion at December 31, 2021. Our personal loans are non-revolving, with a fixed-rate, fixed terms generally between three and six years, and are secured by automobiles, other titled collateral, or are unsecured. During the third quarter of 2021, we began offering credit cards. Credit cards are open-ended, revolving, with a fixed rate, and are unsecured.2022. We consider the delinquency status of our finance receivables as our key credit quality indicator. We monitor the delinquency of our finance receivable portfolio, including the migration between the delinquency buckets and changes in the delinquency trends to manage our exposure to credit risk in the portfolio. Our branch and central operation team members work closely with customers as necessary and offer a variety of borrower assistance programs to help ~~customers continue to make payments.~~support our customers.

DELINQUENCY

We monitor delinquency trends to evaluate the risk of future credit losses and employ advanced analytical tools to manage ~~our exposure.~~performance. Team members are actively engaged in collection activities throughout the early stages of delinquency. We closely track and report the percentage of receivables that are contractually 30-89 days past due as a benchmark of portfolio quality, collections effectiveness, and as a strong indicator of losses in coming quarters.

When personal loans are contractually 60 days past due, we consider these accounts to be at an increased risk for loss and move collection of these accounts ~~is managed by~~to our ~~centralized~~central collection operations. Use of our ~~centralized~~central operations teams for managing late-stage delinquency allows us to apply more advanced collection ~~technologies~~techniques and tools to drive credit performance and ~~drives operating efficiencies in servicing.~~ operational efficiencies.

We consider our personal loans to be nonperforming at 90 days contractually past due, at which point we stop accruing finance charges and reverse finance charges previously accrued.

We For credit cards, we accrue finance charges and fees ~~on credit cards~~ until charge-off at ~~approximately~~ 180 days past due, at which point we reverse finance charges and fees previously accrued.

~~Table of Contents~~

The delinquency information for net finance receivables on a Segment Accounting Basis was as follows:
Consumer and Insurance
(dollars in millions) Personal Loans Credit Cards
September 30, 2022
Current $ 18,648 $ 69
30-59 days past due 326 3
60-89 days past due 227 2
90+ days past due 474 5
Total net finance receivables $ 19,675 $ 79
Delinquency ratio
30-89 days past due 2.81 % 6.58 %
30+ days past due 5.22 % 13.42 %
60+ days past due 3.56 % 9.60 %
90+ days past due 2.41 % 6.84 %
December 31, 2021
Current $ 18,340 $ 25
30-59 days past due 282 —
60-89 days past due 185 —
90+ days past due 383 —
Total net finance receivables $ 19,190 $ 25
Delinquency ratio
30-89 days past due 2.43 % 0.08 %
30+ days past due 4.43 % 0.08 %
60+ days past due 2.96 % — %
90+ days past due 2.00 % — %


	Consumer and Insurance
(dollars in millions)	Personal Loans			Credit Cards
September 30, 2023
Current	$	19,680		$	211



30-89 days past due	621			11
90+ days past due	535			10
Total net finance receivables	$	20,836		$	232

Delinquency ratio
30-89 days past due	2.98		%	4.48		%
30+ days past due	5.55		%	8.98		%

90+ days past due	2.57		%	4.49		%

December 31, 2022
Current	$	18,726		$	93


30-89 days past due	610			6


90+ days past due	544			8
Total net finance receivables	$	19,880		$	107

Delinquency ratio
30-89 days past due	3.07		%	5.90		%
30+ days past due	5.80		%	13.08		%

90+ days past due	2.74		%	7.18		%

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ALLOWANCE FOR FINANCE RECEIVABLE LOSSES

We estimate and record an allowance for finance receivable losses to cover the ~~estimated~~expected lifetime ~~expected~~ credit losses on our finance receivables. Our allowance for finance receivable losses may fluctuate based upon changes in portfolio growth, credit quality, and economic conditions.

Our ~~current~~ methodology to estimate expected credit losses ~~used the most~~uses recent macroeconomic forecasts, which ~~incorporated the overall unemployment rate. Our unemployment outlook leveraged~~include forecasts for unemployment. We leverage projections from various industry leading ~~forecast~~ providers. We also ~~considered~~consider inflationary pressures, consumer confidence levels, and ~~the risk of ongoing~~ interest rate increases ~~negatively impacting~~that may continue to impact the economic outlook. At September 30, ~~2022,~~2023, our economic forecast used a reasonable and supportable period of 12 months. We may experience further changes to the macroeconomic assumptions within our forecast, as well as changes to our loan loss performance outlook, both of which could lead to further changes in our allowance for finance receivable losses, allowance ratio, and provision for finance receivable losses.

Changes in our allowance for finance receivable losses were as follows:


(dollars in millions)	(dollars in millions)	Consumer and Insurance						Segment to GAAP Adjustment		Consolidated Total			(dollars in millions)	Consumer and Insurance						Segment to GAAP Adjustment		Consolidated Total
		Personal Loans			Credit Cards									Personal Loans			Credit Cards

Three Months Ended September 30, 2023													Three Months Ended September 30, 2023
Balance at beginning of period													Balance at beginning of period	$	2,360		$	32		$	—	$	2,392
Provision for finance receivable losses													Provision for finance receivable losses	386			24			—		410
Charge-offs													Charge-offs	(410)			(6)			—		(416)
Recoveries													Recoveries	63			—			—		63
Balance at end of period													Balance at end of period	$	2,399		$	50		$	—	$	2,449

Three Months Ended September 30, 2022	Three Months Ended September 30, 2022												Three Months Ended September 30, 2022
Balance at beginning of period	Balance at beginning of period	$	2,120		$	12		$	(5)	$	2,127		Balance at beginning of period	$	2,120		$	12		$	(5)	$	2,127
Provision for finance receivable losses	Provision for finance receivable losses	414			6			1		421			Provision for finance receivable losses	414			6			1		421
Charge-offs	Charge-offs	(349)			(3)			—		(352)			Charge-offs	(349)			(3)			—		(352)
Recoveries	Recoveries	59			—			—		59			Recoveries	59			—			—		59
Balance at end of period	Balance at end of period	$	2,244		$	15		$	(4)	$	2,255		Balance at end of period	$	2,244		$	15		$	(4)	$	2,255

Three Months Ended September 30, 2021 (a)
Nine Months Ended September 30, 2023													Nine Months Ended September 30, 2023
Balance at beginning of period	Balance at beginning of period	$	2,011		$	—		$	(11)	$	2,000		Balance at beginning of period	$	2,294		$	21		$	(4)	$	2,311
Impact of adoption of ASU 2022-02 (a)													Impact of adoption of ASU 2022-02 (a)	(20)			—			4		(16)
Provision for finance receivable losses	Provision for finance receivable losses	224			—			2		226			Provision for finance receivable losses	1,227			48			—		1,275
Charge-offs	Charge-offs	(223)			—			—		(223)			Charge-offs	(1,302)			(19)			—		(1,321)
Recoveries	Recoveries	58			—			—		58			Recoveries	200			—			—		200

Balance at end of period	Balance at end of period	$	2,070		$	—		$	(9)	$	2,061		Balance at end of period	$	2,399		$	50		$	—	$	2,449

Allowance ratio													Allowance ratio	11.51		%	21.69		%	(b)		11.62		%

Nine Months Ended September 30, 2022	Nine Months Ended September 30, 2022												Nine Months Ended September 30, 2022
Balance at beginning of period	Balance at beginning of period	$	2,097		$	5		$	(7)	$	2,095		Balance at beginning of period	$	2,097		$	5		$	(7)	$	2,095
Provision for finance receivable losses	Provision for finance receivable losses	982			13			3		998			Provision for finance receivable losses	982			13			3		998
Charge-offs	Charge-offs	(1,029)			(3)			—		(1,032)			Charge-offs	(1,029)			(3)			—		(1,032)
Recoveries	Recoveries	194			—			—		194			Recoveries	194			—			—		194
Balance at end of period		$	2,244		$	15		$	(4)	$	2,255

Allowance ratio		11.41		%	19.14		%	(b)		11.42		%

Nine Months Ended September 30, 2021 (a)
Balance at beginning of period		$	2,283		$	—		$	(14)	$	2,269
Provision for finance receivable losses		351			—			5		$	356
Charge-offs		(730)			—			—		$	(730)
Recoveries		166			—			—		$	166
Balance at end of period	Balance at end of period	$	2,070		$	—		$	(9)	$	2,061		Balance at end of period	$	2,244		$	15		$	(4)	$	2,255

Allowance ratio	Allowance ratio	10.98		%	—		%	(b)		10.94		%	Allowance ratio	11.41		%	19.14		%	(b)		11.42		%

(a) ~~The~~As a result of the adoption of ASU 2022-02, we recorded a one-time adjustment to the allowance for finance receivable ~~losses~~losses. See Notes 2, 3, and 4 of the Notes to the Condensed Consolidated Financial Statements for ~~credit cards was immaterial for~~additional information on the ~~three and nine months ended September 30, 2021 as the product offering began~~adoption of ASU 2022-02 included in ~~the third quarter of 2021.~~this report.

(b) Not applicable.

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The current delinquency status of our finance receivable portfolio, inclusive of recent borrower performance, volume of our ~~TDR~~modified finance receivable activity, level and recoverability of collateral securing our finance receivable portfolio, and the reasonable and supportable forecast of economic conditions are the primary drivers that can cause fluctuations in our allowance ratio from period to period. We monitor the allowance ratio to ensure we have a sufficient level of allowance for finance receivable losses based on the estimated lifetime expected credit losses in our finance receivable portfolio. The allowance for finance receivable losses as a percentage of net finance receivables ~~for personal loans~~ increased from the prior year period primarily due to ~~the weakened~~a weaker macroeconomic ~~environment.~~outlook and an increase in delinquent personal loans 30 days or more past due. See Note 4 of the Notes to the Condensed Consolidated Financial Statements included in this report for more information about the changes in the allowance for finance receivable losses.

~~TDR FINANCE RECEIVABLES~~

We make modifications to our finance receivables to assist borrowers experiencing financial difficulties. When we modify a loan’s contractual terms for economic or other reasons related to the borrower’s financial difficulties and grant a concession that we would not otherwise consider, we classify that loan as a TDR finance receivable.

~~Information regarding TDR net finance receivables for personal loans are as follows:~~
(dollars in millions) Personal
Loans Segment to
GAAP
Adjustment GAAP
Basis
September 30, 2022
TDR net finance receivables $ 815 $ (13) $ 802
Allowance for TDR finance receivable losses 312 (5) 307
December 31, 2021
TDR net finance receivables $ 671 $ (21) $ 650
Allowance for TDR finance receivable losses 279 (9) 270

~~There were no credit cards classified as TDR finance receivables at September 30, 2022 or December 31, 2021.~~

~~Table of Contents~~

~~DISTRIBUTION OF FINANCE RECEIVABLES BY FICO SCORE~~

There are many different categorizations used in the consumer lending industry to describe the creditworthiness of a borrower, including prime, near-prime, and sub-prime. While management does not utilize credit scores to manage credit quality, we group FICO scores into the following categories for comparability purposes across our industry:

•~~Prime: FICO score of 660 or higher~~

•~~Near-prime: FICO score of 620-659~~

•~~Sub-prime: FICO score of 619 or below~~

Our customers’ demographics are, in many respects, near the national median but may vary from national norms in terms of credit and repayment histories. Many of our customers have experienced some level of prior financial difficulty or have limited credit experience and require higher levels of servicing and support from our branch network and central servicing operations.

The following table reflects our net finance receivables grouped into the borrower categories described above based on borrower FICO credit scores as of the most recently refreshed date or as of the loan origination or purchase date:

(dollars in millions) Personal Loans Credit Cards Total
September 30, 2022
FICO scores
660 or higher $ 4,329 $ 10 $ 4,339
620-659 5,070 26 5,096
619 or below 10,274 43 10,317
Total $ 19,673 $ 79 $ 19,752
December 31, 2021
FICO scores *
660 or higher $ 4,897 $ 14 $ 4,911
620-659 5,321 7 5,328
619 or below 8,969 4 8,973
Total $ 19,187 $ 25 $ 19,212

* Due to the impact of COVID-19, FICO scores as of December 31, 2021 may have been positively impacted by government stimulus measures, borrower assistance programs, and potentially inconsistent reporting to credit bureaus.

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Liquidity and Capital Resources

SOURCES AND USES OF FUNDS

We finance the majority of our operating liquidity and capital needs through a combination of cash flows from operations, secured debt, unsecured debt, borrowings from revolving conduit facilities, whole loan sales, and equity. We may also utilize other sources in the future. As a holding company, all of the funds generated from our operations are earned by our operating subsidiaries. Our operating subsidiaries’ primary cash needs relate to funding our lending activities, our debt service obligations, our operating expenses, payment of insurance claims, and expenditures relating to upgrading and monitoring our technology platform, risk systems, and branch locations.

We have previously purchased portions of our unsecured indebtedness, and we may elect to purchase additional portions of our unsecured indebtedness or securitized borrowings in the future. Future purchases may be made through the open market, privately negotiated transactions with third parties, or pursuant to one or more tender or exchange offers, all of which are subject to terms, prices, and consideration we may determine at our discretion.

During the nine months ended September 30, ~~2022,~~2023, OMH generated net income of ~~$698~~$476 million. OMH’s net cash ~~inflow~~outflow from operating and investing activities totaled ~~$226~~$311 million for the nine months ended September 30, ~~2022.~~2023. At September 30, ~~2022,~~2023, our scheduled principal and interest payments for the remainder of ~~2022 totaled $34 million, and there are no scheduled principal payments for the remainder of 2022~~2023 on our existing debt (excluding securitizations). totaled $262 million. As of September 30, ~~2022,~~2023, we had ~~$9.5~~$7.5 billion of unencumbered loans.

Based on our estimates and considering the risks and uncertainties of our plans, we believe that we will have adequate liquidity to finance and operate our businesses and repay our obligations as they become due.

OMFC’s Issuances and Repurchases of Unsecured Debt

On June 22, 2023, OMFC issued a total of $500 million aggregate principal amount of 9.00% Senior Notes due ~~for at least~~2029 (the “9.00% Senior Notes due 2029”) under the ~~next 24 months.~~Base Indenture, as supplemented by the Fifteenth Supplemental Indenture, pursuant to which OMH provided a guarantee on an unsecured basis.

On August 18, 2023, OMFC issued a notice to partially redeem its 6.125% Senior Notes due 2024. On September 18, 2023, OMFC paid a net aggregate amount of $558 million, inclusive of accrued interest, to complete the partial redemption.

From time to time we may purchase portions of our unsecured indebtedness through the open market. During the nine months ended September 30, 2023, we repurchased $157 million of our unsecured notes.

OMFC’s Unsecured Corporate Revolver

At September 30, ~~2022,~~2023, the borrowing capacity of our corporate revolver was $1.25 billion, and no amounts were drawn.

~~OMFC’s Redemption and Repurchases of Unsecured Debt~~

~~For information regarding the redemption and open market repurchases of OMFC’s unsecured debt, see Note 6 of the Notes to the Condensed Consolidated Financial Statements included in this report.~~

Securitizations and Borrowings from Revolving Conduit Facilities

During the nine months ended September 30, ~~2022,~~2023, we completed three personal loan securitizations ~~(OMFIT 2022-S1, ODART 2022-1, and~~(ODART 2023-1, OMFIT ~~2022-2,~~2023-1, OMFIT 2023-2, see “Securitized Borrowings” below) and redeemed ~~four~~no personal loan ~~securitizations (ODART 2018-1, OMFIT 2019-1, OMFIT 2015-3, and OMFIT 2018-1).~~securitizations. During the nine months ended September 30, ~~2022,~~2023, we entered into ~~one~~no new revolving conduit ~~facility.~~facilities. At September 30, ~~2022, an aggregate~~2023, the borrowing capacity of ~~$500 million was drawn under~~ our revolving conduit facilities was $6.2 billion, and ~~the remaining borrowing capacity was $5.7 billion.~~no amounts were drawn. At September 30, ~~2022,~~2023, we had ~~$10.0~~$13.1 billion of gross finance receivables pledged as collateral for our securitizations ~~conduit facilities,~~ and private secured term funding.

Private Secured Term Funding

~~On April 25, 2022, OMFC entered into a~~At September 30, 2023, an aggregate amount of $350 million was outstanding under the private secured term funding collateralized by our personal loans. No principal payments are required to be made ~~during the first three years,~~until after April 25, 2025, followed by a subsequent one-year amortization period at the expiration of which the outstanding principal amount is due and payable.

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Credit Ratings

Our credit ratings impact our ability to access capital markets and our borrowing costs. Rating agencies base their ratings on numerous factors, including liquidity, capital adequacy, asset quality, quality of earnings, and the probability of systemic support. Significant changes in these factors could result in different ratings.

The table below outlines OMFC’s long-term corporate debt ratings and outlook by rating agencies:

As of September 30, ~~2022~~2023

Rating

Outlook

S&P

Stable

Moody’s

Ba2

Stable

KBRA

BB+

Positive

Currently, no other entity has a corporate debt rating, though they may be rated in the future.

Stock Repurchased

During the nine months ended September 30, ~~2022,~~2023, OMH repurchased ~~5,559,382~~1,120,903 shares of its common stock through its stock repurchase program for an aggregate total of ~~$247~~$45 million, including commissions and fees. As of September 30, ~~2022,~~2023, OMH held a total of ~~12,214,566~~14,872,259 shares of treasury stock. To provide funding for the OMH stock repurchases, the OMFC Board of Directors authorized dividend payments in the amount of ~~$240~~$40 million.

For additional information regarding the shares repurchased, see Item 2. Unregistered Sales of Equity Securities and Use of Proceeds of Part II included in this report.

Cash Dividend to OMH's Common Stockholders

As of September 30, ~~2022,~~2023, the dividend declarations for the current year by the Board were as follows:

Declaration Date Record Date Payment Date Dividend Per Share Amount Paid
(in millions)
February 2, 2022 February 14, 2022 February 18, 2022 $ 0.95 $ 121
April 28, 2022 May 9, 2022 May 13, 2022 0.95 118
July 27, 2022 August 8, 2022 August 12, 2022 0.95 117
Total $ 2.85 $ 356


Declaration Date	Record Date	Payment Date	Dividend Per Share		Amount Paid
						(in millions)
February 7, 2023	February 17, 2023	February 24, 2023	$	1.00		$	121
April 25, 2023	May 5, 2023	May 12, 2023	1.00			121
July 26, 2023	August 7, 2023	August 11, 2023	1.00			120

Total			$	3.00		$	362

To provide funding for the dividend, OMFC paid dividends of ~~$355~~$358 million to OMH during the nine months ended September 30, ~~2022.~~2023.

On October ~~26, 2022,~~25, 2023, OMH declared a dividend of ~~$0.95~~$1.00 per share payable on November ~~14, 2022~~10, 2023 to record holders of OMH's common stock as of the close of business on November ~~7, 2022.~~6, 2023. To provide funding for the OMH dividend, the OMFC Board of Directors authorized a dividend in the amount of up to ~~$117~~$121 million payable on or after November ~~8, 2022.~~7, 2023.

While OMH intends to pay its minimum quarterly dividend, currently ~~$0.95~~$1.00 per share, for the foreseeable future, all subsequent dividends will be reviewed and declared at the discretion of the Board and will depend on many factors, including our financial condition, earnings, cash flows, capital requirements, level of indebtedness, statutory and contractual restrictions applicable to the payment of dividends, and other considerations that the Board deems relevant. OMH’s dividend payments may change from time to time, and the Board may choose not to continue to declare dividends in the future. See our “Dividend Policy” in Part II - Item 5 included in our Annual Report for further information.

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Whole Loan Sale Transactions

LIQUIDITY

OMH's Operating Activities

Net cash provided by operations of $1.8 billion for the nine months ended September 30, 2023 reflected net income of $476 million, the impact of non-cash items, and an unfavorable change in working capital of $54 million. Net cash provided by operations of $1.7 billion for the nine months ended September 30, 2022 reflected net income of ~~$698~~$696 million, the impact of non-cash items, and an unfavorable change in working capital of $124 million. Net cash provided by operations of $1.6 billion for the nine months ended September 30, 2021 reflected net income of $1.1 billion, the impact of non-cash items, and an unfavorable change in working capital of $53$121 million.

OMH's Investing Activities

Net cash used for investing activities of $2.2 billion and $1.5 billion for the nine months ended September 30, 2023 and 2022, respectively, was primarily due to net principal originations and purchases of finance receivables and purchases of available-for-sale and other securities, partially offset by the proceeds from sales of finance receivables and calls, sales, and maturities of available-for-sale and other securities. Net cash used for investing activities of $1.5 billion for the nine months ended September 30, 2021 was primarily due to net principal originations of finance receivables and purchases of available-for-sale and other securities, partially offset by calls, sales and maturities of available-for-sale and other securities and proceeds from sales of finance receivables.

OMH's Financing Activities

Net cash provided by financing activities of $1.1 billion for the nine months ended September 30, 2023 was primarily due to the issuance and borrowings of long-term debt, partially offset by repayments and repurchases of long-term debt and cash dividends paid. Net cash used for financing activities of $224 million for the nine months ended September 30, 2022 was primarily due to ~~debt~~ repayments and repurchases of long-term debt, cash dividends paid, and the cash paid to repurchase common stock during the period, partially offset by the ~~issuances~~issuance and borrowings of OMFIT 2022-S1, ODART 2022-1, OMFIT 2022-2, and the private secured term funding. Net cash used for financing activities of $1.6 billion for the nine months ended September 30, 2021 was primarily due to debt repayments and repurchases, cash dividends paid, and the cash paid on the common stock repurchased in the period, partially offset by the issuances of OMFIT 2021-1 securitization, the Social Bond, and the 3.875% Senior Notes due 2028.long-term debt.

OMH's Cash and Investments

At September 30, ~~2022,~~2023, we had ~~$536 million~~$1.2 billion of cash and cash equivalents, which included ~~$142~~$169 million of cash and cash equivalents held at our regulated insurance subsidiaries or for other operating activities that is unavailable for general corporate purposes.

At September 30, ~~2022,~~2023, we had ~~$1.7~~$1.6 billion of investment securities, which are all held as part of our insurance operations and are unavailable for general corporate purposes.

Liquidity Risks and Strategies

OMFC’s credit ratings are non-investment grade, which has a significant impact on our cost and access to capital. This, in turn, can negatively affect our ability to manage our liquidity and our ability or cost to refinance our indebtedness. There are numerous risks to our financial results, liquidity, capital raising, and debt refinancing plans, some of which may not be quantified in our current liquidity forecasts. These risks are further described in our “Liquidity and Capital Resources” of Management’s Discussion and Analysis of Financial Condition and Results of Operations in Part II - Item 7 included in our Annual Report.

~~Table of Contents~~

The principal factors that could decrease our liquidity are customer delinquencies and defaults, a decline in customer prepayments, rising interest rates, and a prolonged inability to adequately access capital market funding. We intend to support our liquidity position by utilizing strategies that are further described in our “Liquidity and Capital Resources” of Management’s Discussion and Analysis of Financial Condition and Results of Operations in Part II - Item 7 included in our Annual Report.

However, it is possible that the actual outcome of one or more of our plans could be materially different than expected or that one or more of our significant judgments or estimates could prove to be materially incorrect.

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OUR INSURANCE SUBSIDIARIES

Our insurance subsidiaries are subject to state regulations that limit their ability to pay dividends. ~~Triton~~Dividends paid ~~an ordinary dividend~~ to OneMain Financial Holdings, LLC (“OMFH”) were as follows:


	Nine Months Ended September 30,
	2023				2022
(dollars in millions)	Ordinary		Extraordinary*		Ordinary		Extraordinary

AHL	$	98	$	67	$	—	$	—
Triton	58		2		50		—

* AHL declared an extraordinary dividend of ~~$50~~$107 million, ~~during the nine months ended September 30, 2022. AHL did not pay any dividends during the nine months ended September 30, 2022.~~of which $67 million has been paid. Triton ~~and AHL did not pay dividends during the nine months ended September 30, 2021.~~ declared an extraordinary dividend of $23 million, of which $2 million has been paid.

See Note 10 of the Notes to the Consolidated Financial Statements in Part II - Item 8 included in our Annual Report for further information on these state restrictions and the dividends paid by our insurance subsidiaries in ~~2021.~~2022.

OUR DEBT AGREEMENTS

The debt agreements which OMFC and its subsidiaries are a party to include customary terms and conditions, including covenants and representations and warranties. See Note 8 of the Notes to the Consolidated Financial Statements in Part II - Item 8 included in our Annual Report for more information on the restrictive covenants under OMFC’s debt agreements, as well as the guarantees of OMFC’s long-term debt.

Securitized Borrowings

We execute private securitizations under Rule 144A of the Securities Act of 1933, as amended. As of September 30, ~~2022,~~2023, our structured financings consisted of the following:


(dollars in millions)	(dollars in millions)	Issue Amount (a)		Initial Collateral Balance		Current Note Amounts Outstanding (a)		Current Collateral Balance (b)		Current Weighted Average Interest Rate		Original Revolving Period	(dollars in millions)	Issue Amount (a)		Initial Collateral Balance		Current Note Amounts Outstanding (a)		Current Collateral Balance (b)		Current Weighted Average Interest Rate		Original Revolving Period

OMFIT 2016-3		350		397		38		127		6.58	%	5 years

OMFIT 2018-2	OMFIT 2018-2	368		381		350		400		3.87	%	5 years	OMFIT 2018-2	368		381		246		276		3.99	%	5 years
OMFIT 2019-2	OMFIT 2019-2	900		947		900		995		3.30	%	7 years	OMFIT 2019-2	900		947		900		995		3.30	%	7 years
OMFIT 2019-A	OMFIT 2019-A	789		892		750		892		3.78	%	7 years	OMFIT 2019-A	789		892		750		892		3.78	%	7 years
OMFIT 2020-1	OMFIT 2020-1	821		958		586		680		4.23	%	2 years	OMFIT 2020-1	821		958		199		316		4.98	%	2 years
OMFIT 2020-2	OMFIT 2020-2	1,000		1,053		1,000		1,053		2.03	%	5 years	OMFIT 2020-2	1,000		1,053		1,000		1,053		2.03	%	5 years
OMFIT 2021-1	OMFIT 2021-1	850		904		850		904		2.10	%	5 years	OMFIT 2021-1	850		904		850		904		2.81	%	5 years
OMFIT 2022-S1	OMFIT 2022-S1	600		652		600		652		4.31	%	3 years	OMFIT 2022-S1	600		652		600		652		4.31	%	3 years
OMFIT 2022-2 ~~(c)~~	OMFIT 2022-2 ~~(c)~~	1,000		1,099		1,000		1,099		5.17	%	2 years	OMFIT 2022-2 ~~(c)~~	1,000		1,099		1,000		1,099		5.17	%	2 years
OMFIT 2022-3													OMFIT 2022-3	979		1,090		796		1,090		6.00	%	2 years
OMFIT 2023-1													OMFIT 2023-1	825		920		825		920		5.82	%	5 years
OMFIT 2023-2 (c)													OMFIT 2023-2 (c)	1,400		1,566		1,400		1,566		6.44	%	3 years
ODART 2019-1	ODART 2019-1	737		750		700		750		3.79	%	5 years	ODART 2019-1	737		750		700		750		3.79	%	5 years
ODART 2021-1	ODART 2021-1	1,000		1,053		1,000		1,053		0.98	%	2 years	ODART 2021-1	1,000		1,053		1,000		1,053		0.98	%	2 years
ODART 2022-1	ODART 2022-1	600		632		600		631		4.74	%	2 years	ODART 2022-1	600		632		600		632		5.09	%	2 years
ODART 2023-1													ODART 2023-1	750		792		750		792		5.63	%	3 years
Total securitizations	Total securitizations	$	9,015	$	9,718	$	8,374	$	9,236				Total securitizations	$	12,619	$	13,689	$	11,616	$	12,990

(a) Issue Amount includes the retained interest amounts as applicable and the Current Note Amounts Outstanding balances reflect pay-downs subsequent to note issuance and exclude retained interest amounts.

(b) Inclusive of in-process replenishments of collateral for securitized borrowings in a revolving status as of September 30, ~~2022.~~2023.

(c) On ~~September 9, 2022,~~August 22, 2023 we issued $1$1.4 billion of notes backed by personal loans. The notes mature in ~~October 2034.~~2036.

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Revolving Conduit Facilities

In addition to the structured financings, we had access to 15 revolving conduit facilities with a total borrowing capacity of $6.2 billion as of September 30, ~~2022:~~2023:
(dollars in millions) Advance Maximum Balance Amount
Drawn
OneMain Financial Funding VII, LLC $ 600 $ —
OneMain Financial Funding IX, LLC 600 —
OneMain Financial Auto Funding I, LLC 550 —
Seine River Funding, LLC 550 —
Chicago River Funding, LLC 375 —
Hudson River Funding, LLC 500 —
OneMain Financial Funding VIII, LLC 400 —
Mystic River Funding, LLC 350 —
Thayer Brook Funding, LLC 350 —
Columbia River Funding, LLC 350 —
Hubbard River Funding, LLC 250 —
New River Funding Trust 250 —
River Thames Funding, LLC 400 100
St. Lawrence River Funding, LLC 250 —
OneMain Financial Funding X, LLC 400 400
Total $ 6,175 $ 500


(dollars in millions)	Advance Maximum Balance		Amount Drawn

OneMain Financial Funding VII, LLC	$	600	$	—
OneMain Financial Funding IX, LLC	600		—
OneMain Financial Auto Funding I, LLC	550		—
Seine River Funding, LLC	550		—
Hudson River Funding, LLC	500		—
OneMain Financial Funding VIII, LLC	400		—
River Thames Funding, LLC	400		—
OneMain Financial Funding X, LLC	400		—
Chicago River Funding, LLC	375		—
Mystic River Funding, LLC	350		—
Thayer Brook Funding, LLC	350		—
Columbia River Funding, LLC	350		—
Hubbard River Funding, LLC	250		—
New River Funding Trust	250		—
St. Lawrence River Funding, LLC	250		—
Total	$	6,175	$	—

OFF-BALANCE SHEET ARRANGEMENTS

We have no material off-balance sheet arrangements as defined by SEC rules, and we had no material off-balance sheet exposure to losses associated with unconsolidated VIEs at September 30, ~~2022~~2023 or December 31, ~~2021.~~2022.

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Critical Accounting Policies and Estimates

We describe our significant accounting policies used in the preparation of our condensed consolidated financial statements in Note 2 of the Notes to the Condensed Consolidated Financial Statements in Part II - Item 8 included in our Annual Report. We consider the ~~following policies~~allowance for finance receivable losses to be ~~our most~~a critical accounting ~~policies~~policy because ~~they involve~~it involves critical accounting estimates and a significant degree of management ~~judgment:~~judgment.

•~~allowance for finance receivable losses; and~~

•During the nine months ended September 30, 2023, we removed TDR finance ~~receivables.~~receivables as a critical accounting policy and estimate as ASU 2022-02 superseded the accounting for troubled debt restructurings by creditors as of January 1, 2023.

There have been no other material changes to our critical accounting policies or to our methodologies for deriving critical accounting estimates during the nine months ended September 30, ~~2022.~~2023.


Recent Accounting Pronouncements

See Note 2 of the Notes to the Condensed Consolidated Financial Statements included in this report for discussion of recently issued accounting pronouncements.


Seasonality

Our personal loan volume is generally highest during the second and fourth quarters of the year, primarily due to marketing efforts and seasonality of demand. Demand for our personal loans is usually lower in January and February after the holiday season and as a result of tax refunds. Delinquencies on our personal loans are generally lower in the first and second quarters and tend to rise throughout the remainder of the year. These seasonal trends contribute to fluctuations in our operating results and cash needs throughout the year.


Item 3. Quantitative and Qualitative Disclosures About Market Risk.

There have been no material changes to our market risk previously disclosed in Part II - Item 7A included in our Annual Report.

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Item 4. Controls and Procedures.

CONTROLS AND PROCEDURES OF ONEMAIN HOLDINGS, INC.

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are designed to provide reasonable assurance that the information OMH is required to disclose in reports that OMH files or submits under the Exchange Act, is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including the Chief Executive Officer and the Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

As of September 30, ~~2022,~~2023, OMH carried out an evaluation of the effectiveness of its disclosure controls and procedures, as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. This evaluation was conducted under the supervision of, and with the participation of OMH’s management, including the Chief Executive Officer and the Chief Financial Officer. Based on the evaluation, the Chief Executive Officer and the Chief Financial Officer concluded that OMH's disclosure controls and procedures were effective as of September 30, ~~2022~~2023 to provide the reasonable assurance described above.

Changes in Internal Control over Financial Reporting

There were no changes in OMH's internal control over financial reporting during the third quarter of ~~2022~~2023 that have materially affected, or are reasonably likely to materially affect, OMH's internal control over financial reporting.

CONTROLS AND PROCEDURES OF ONEMAIN FINANCE CORPORATION

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are designed to provide reasonable assurance that the information OMFC is required to disclose in reports that OMFC files or submits under the Exchange Act, is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including the Chief Executive Officer and the Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

As of September 30, ~~2022,~~2023, OMFC carried out an evaluation of the effectiveness of its disclosure controls and procedures, as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. This evaluation was conducted under the supervision of, and with the participation of OMFC’s management, including the Chief Executive Officer and the Chief Financial Officer. Based on the evaluation, the Chief Executive Officer and the Chief Financial Officer concluded that OMFC's disclosure controls and procedures were effective as of September 30, ~~2022~~2023 to provide the reasonable assurance described above.

Changes in Internal Control over Financial Reporting

There were no changes in OMFC's internal control over financial reporting during the third quarter of ~~2022~~2023 that have materially affected, or are reasonably likely to materially affect, OMFC's internal control over financial reporting.

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PART II — OTHER INFORMATION


Item 1. Legal Proceedings.

See Note 12 of the Notes to the Condensed Consolidated Financial Statements included in this report.


Item 1A. Risk Factors.

In addition to the other information set forth in this report, you should consider the factors discussed in Part I - Item 1A. “Risk Factors” in our Annual Report, which could materially affect our business, financial condition, or future results.


Item 2. Unregistered Sales of Equity Securities, ~~and~~ Use of Proceeds, and Issuer Purchases of Equity Securities

There were no unregistered sales of our common stock during the period covered by this Quarterly Report on Form 10-Q.

Issuer Purchases of Equity Securities

The following table presents information regarding repurchases of our common stock, excluding commissions and fees, during the quarter ended September 30, ~~2022,~~2023, based on settlement date:


Period	Period	Total Number of Shares Purchased	Average Price paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (a)	Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs (a)		Period	Total Number of Shares Purchased	Average Price paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (a)	Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs (a)
July 1 - July 31	July 1 - July 31	101,704	$	39.33	101,704	$	820,597,781	July 1 - July 31	45,580	$	43.88	45,580	$	689,506,787
August 1 - August 31	August 1 - August 31	459,916	37.83		459,916	803,198,287		August 1 - August 31	—	—		—	689,506,787
September 1 - September 30	September 1 - September 30	618,813	33.94		618,813	782,198,612		September 1 - September 30	222,689	40.14		222,689	680,567,700
Total	Total	1,180,433	$	35.92	1,180,433			Total	268,269	$	40.78	268,269

(a) On February 2, 2022, the Board authorized a $1 billion stock repurchase program, excluding fees, commissions, and other expenses related to the repurchases. The authorization expires on December 31, 2024. The timing, number and share price of any additional shares repurchased will be determined by OMH based on its evaluation of market conditions and other factors and will be made in accordance with applicable securities laws in either the open market or in privately negotiated transactions. OMH is not obligated to purchase any shares under the program, which may be modified, suspended or discontinued at any time.


Item 3. Defaults Upon Senior Securities.

None.


Item 4. Mine Safety Disclosures.

None.


Item 5. Other Information.

~~None.~~During the quarter ended September 30, 2023, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” each as defined in Item 408(a) of Regulation S-K.

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Item 6. Exhibit Index.


Exhibit Number						Description













































31.1						Rule 13a-14(a)/15d-14(a) Certifications of ~~the President and Chief~~Principal Executive Officer of OneMain Holdings, Inc.

31.2						Rule 13a-14(a)/15d-14(a) Certifications of the ~~Executive Vice President and Chief~~Principal Financial Officer of OneMain Holdings, Inc.

31.3						Rule 13a-14(a)/15d-14(a) Certifications of the ~~President and Chief~~Principal Executive Officer of OneMain Finance Corporation

31.4						Rule 13a-14(a)/15d-14(a) Certifications of the ~~Executive Vice President and Chief~~Principal Financial Officer of OneMain Finance Corporation

32.1						Section 1350 Certifications of OneMain Holdings, Inc.

32.2						Section 1350 Certifications of OneMain Finance Corporation

101						Interactive data files pursuant to Rule 405 of Regulation S-T, formatted in Inline XBRL: (i) Condensed Consolidated Balance Sheets, (ii) Condensed Consolidated Statements of Operations, (iii) Condensed Consolidated Statements of Comprehensive Income, (iv) Condensed Consolidated Statements of Shareholder’s Equity, (v) Condensed Consolidated Statements of Cash Flows, and (vi) Notes to the Condensed Consolidated Financial Statements.

104						Cover Page Interactive Data File in Inline XBRL format (Included in Exhibit 101).

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OMH Signature

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

ONEMAIN HOLDINGS, INC.

(Registrant)

Date:

October ~~28, 2022~~26, 2023

By:

/s/ Micah R. Conrad

Micah R. Conrad

Executive Vice President and Chief Financial Officer

(Duly Authorized Officer and Principal Financial Officer)

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OMFC Signature

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

ONEMAIN FINANCE CORPORATION

(Registrant)

Date:

October ~~28, 2022~~26, 2023

By:

/s/ ~~Micah R. Conrad~~Matthew W. Vaughan

~~Micah R. Conrad~~Matthew W. Vaughan

~~Executive~~ Vice President - Senior Managing Director and Chief Financial Officer

(Duly Authorized Officer and Principal Financial Officer)

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Topic						Page

Forward-Looking Statements						3946
Overview						4047
Recent Developments and Outlook						4148
Results of Operations						4350
Segment Results						4653
Credit Quality						4855
Liquidity and Capital Resources						5358

Critical Accounting Policies and Estimates						5863
Recent Accounting Pronouncements						5863
Seasonality						5863


(dollars in millions)	Personal Loans		Segment to GAAP Adjustment		GAAP Basis

September 30, 2022
TDR net finance receivables	$	815	$	(13)	$	802
Allowance for TDR finance receivable losses	312		(5)		307

December 31, 2021
TDR net finance receivables	$	671	$	(21)	$	650
Allowance for TDR finance receivable losses	279		(9)		270