Cover Page
Cover Page - shares | 9 Months Ended | |
Sep. 30, 2020 | Oct. 26, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2020 | |
Document Transition Report | false | |
Entity File Number | 001-36270 | |
Entity Registrant Name | SANTANDER CONSUMER USA HOLDINGS INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 32-0414408 | |
Entity Address, Address Line One | 1601 Elm Street | |
Entity Address, Address Line Two | Suite 800 | |
Entity Address, City or Town | Dallas | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 75201 | |
City Area Code | 214 | |
Local Phone Number | 634-1110 | |
Title of 12(b) Security | Common Stock ($0.01 par value) | |
Trading Symbol | SC | |
Security Exchange Name | NYSE | |
Entity Common Stock, Shares Outstanding (in shares) | 306,070,972 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Emerging Growth Company | false | |
Entity Small Business | false | |
Entity Shell Company | false | |
Entity Central Index Key | 0001580608 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
ASSETS | ||
Cash and cash equivalents - $26,920 and $41,785 held at affiliates, respectively | $ 105,616 | $ 81,848 |
Finance receivables held for sale, net | 763,292 | 1,007,105 |
Finance receivables held for investment, at amortized cost | 33,602,108 | 30,810,487 |
Allowance for credit loss | (6,152,378) | (3,043,468) |
Finance receivables held for investment, at amortized cost, net | 27,449,730 | 27,767,019 |
Restricted cash - $27 and $27 held at affiliates, respectively | 2,267,154 | 2,079,239 |
Accrued interest receivable | 428,586 | 288,615 |
Goodwill | 74,056 | 74,056 |
Intangible assets, net of amortization of $60,395 and $52,665, respectively | 62,341 | 42,772 |
Other assets - $5,878 and $30,841 held at affiliates, respectively | 1,042,665 | 1,071,020 |
TOTAL ASSETS | 48,448,921 | 48,933,529 |
LIABILITIES | ||
Borrowings and other debt obligations - $11,208,796 and $5,652,325 to/from affiliates, respectively | 41,369,347 | 39,194,141 |
Deferred tax liabilities, net | 1,095,238 | 1,468,222 |
Accounts payable and accrued expenses - $83,254 and $63,951 held at affiliates, respectively | 524,816 | 563,277 |
Other liabilities - $816 and $24,730 held at affiliates, respectively | 364,708 | 389,269 |
TOTAL LIABILITIES | 43,354,109 | 41,614,909 |
Commitments and contingencies (Notes 7 and 14) | ||
STOCKHOLDERS' EQUITY: | ||
Common stock, $0.01 par value - 1,100,000,000 shares authorized; 0 and 362,798,115 shares issued and 0 and 339,201,748 shares outstanding, respectively | 3,061 | 3,392 |
Additional paid-in capital | 394,428 | 1,173,262 |
Accumulated other comprehensive income (loss), net of taxes | (56,882) | (26,693) |
Retained earnings | 4,754,205 | 6,168,659 |
TOTAL STOCKHOLDERS' EQUITY | 5,094,812 | 7,318,620 |
TOTAL LIABILITIES AND EQUITY | 48,448,921 | 48,933,529 |
Leased Vehicles | ||
ASSETS | ||
Property, plant and equipment, net | 16,195,376 | 16,461,982 |
Furniture and Fixtures | ||
ASSETS | ||
Property, plant and equipment, net | $ 60,105 | $ 59,873 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
ASSETS | ||
Cash and cash equivalents held for affiliates | $ 26,920 | $ 41,785 |
Restricted cash held for affiliates | 27 | 27 |
Accumulated depreciation | 99,382 | 85,347 |
Amortization | 60,395 | 52,665 |
Other assets held at affiliates | 5,878 | 30,841 |
LIABILITIES | ||
Total borrowings and other debt obligations from/to affiliates | 11,208,796 | 5,652,325 |
Accounts payable and accrued expenses held at affiliates | 83,254 | 63,951 |
Other liabilities held at affiliates | $ 816 | $ 24,730 |
STOCKHOLDERS' EQUITY: | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 1,100,000,000 | 1,100,000,000 |
Common stock, shares issued (in shares) | 363,138,607 | 362,798,115 |
Common stock, shares outstanding (in shares) | 306,070,972 | 339,201,748 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Income Statement [Abstract] | ||||
Interest on finance receivables and loans | $ 1,300,694 | $ 1,273,022 | $ 3,811,113 | $ 3,787,700 |
Leased vehicle income | 725,156 | 706,302 | 2,210,684 | 2,032,098 |
Other finance and interest income | 2,146 | 9,926 | 12,354 | 31,610 |
Total finance and other interest income | 2,027,996 | 1,989,250 | 6,034,151 | 5,851,408 |
Interest expense — Including $87,851, $54,719 and $221,676 and $145,501 to affiliates, respectively | 292,118 | 335,212 | 929,934 | 999,633 |
Leased vehicle expense | 467,172 | 456,193 | 1,630,945 | 1,344,654 |
Net finance and other interest income | 1,268,706 | 1,197,845 | 3,473,272 | 3,507,121 |
Credit loss expense | 340,548 | 566,849 | 2,110,331 | |
Net finance and other interest income after credit loss expense | 928,158 | 630,996 | 1,362,941 | 1,958,717 |
Profit sharing | 30,414 | 18,125 | 56,239 | 38,438 |
Net finance and other interest income after credit loss expense and profit sharing | 897,744 | 612,871 | 1,306,702 | 1,920,279 |
Investment losses, net | (68,989) | (86,397) | (279,997) | (238,281) |
Servicing fee income — Including $10,050, $13,117, $33,923 and $40,405 from affiliates, respectively | 18,574 | 21,447 | 56,797 | 70,255 |
Fees, commissions, and other — Including $1,254, $13,465, $11,127 and $32,432 from affiliates, respectively | 78,924 | 96,243 | 256,123 | 280,815 |
Total other income | 28,509 | 31,293 | 32,923 | 112,789 |
Compensation and benefits | 127,991 | 132,271 | 388,960 | 382,843 |
Repossession expense | 35,910 | 62,937 | 115,861 | 203,496 |
Other expenses — Including $1,456, $1,222, $3,762 and $3,220 to affiliates, respectively | 99,761 | 134,262 | 308,193 | 314,737 |
Total other expenses | 263,662 | 329,470 | 813,014 | 901,076 |
Income (loss) before income taxes | 662,591 | 314,694 | 526,611 | 1,131,992 |
Income tax expense | 172,476 | 82,156 | 137,161 | 283,684 |
Net income (loss) | 490,115 | 232,538 | 389,450 | 848,308 |
Other comprehensive income (loss): | ||||
Unrealized gains (losses) on cash flow hedges, net of tax of $2,083, $(3,610), $(10,419) and $(21,275), respectively | 7,112 | (11,158) | (31,726) | (66,241) |
Unrealized gains (losses) on available-for-sale and held-to-maturity debt securities net of tax of $(88), $(35), $500 and $286, respectively | (289) | (111) | 1,537 | 890 |
Comprehensive income (loss) | $ 496,938 | $ 221,269 | $ 359,261 | $ 782,957 |
Net income per common share (basic) (in dollars per share) | $ 1.58 | $ 0.67 | $ 1.21 | $ 2.43 |
Net income per common share (diluted) (in dollars per share) | 1.58 | 0.67 | 1.21 | 2.42 |
Dividends declared per common share (in dollars per share) | $ 0.22 | $ 0.22 | $ 0.66 | $ 0.62 |
Weighted average common shares (basic) (in shares) | 310,150,293 | 345,469,657 | 321,275,907 | 349,341,627 |
Weighted average common shares (diluted) (in shares) | 310,307,265 | 345,956,043 | 321,492,331 | 349,855,822 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Income Statement [Abstract] | ||||
Interest expense to affiliates | $ 87,851 | $ 54,719 | $ 221,676 | $ 145,501 |
Servicing fee income from affiliates | 10,050 | 13,117 | 33,923 | 40,405 |
Fees, commissions and other from affiliates | 1,254 | 13,465 | 11,127 | 32,432 |
Other operating costs to affiliates | 1,456 | 1,222 | 3,762 | 3,220 |
Change in unrealized gains (losses) on cash flow hedges, tax | 2,083 | (3,610) | (10,419) | (21,275) |
Unrealized gain/losses on available-for-sale securities, tax | $ (88) | $ (35) | $ 500 | $ 286 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Thousands | Total | Cumulative Effect, Period Of Adoption, Adjustment | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings | Retained EarningsCumulative Effect, Period Of Adoption, Adjustment |
Beginning balance (in shares) at Dec. 31, 2018 | 352,303,000 | ||||||
Beginning balance at Dec. 31, 2018 | $ 7,018,358 | $ 3,523 | $ 1,515,572 | $ 33,515 | $ 5,465,748 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Stock issued in connection with employee incentive compensation plans (in shares) | 756,000 | ||||||
Stock issued in connection with employee incentive compensation plans | 1,320 | $ 8 | 1,312 | ||||
Stock-based compensation expense | $ 7,973 | 7,973 | |||||
Stock repurchase/Treasury stock (in shares) | (10,194,772) | (10,195,000) | |||||
Stock repurchase/Treasury stock | $ (245,663) | $ (102) | (245,561) | ||||
Dividends-Common stock | (216,761) | (216,761) | |||||
Tax sharing with affiliate | (2,982) | (2,982) | |||||
Available-for-sale securities, net of taxes | 890 | 890 | |||||
Net income (loss) | 848,308 | 848,308 | |||||
Other comprehensive income (loss), net of taxes | (66,241) | (66,241) | |||||
Ending balance (in shares) at Sep. 30, 2019 | 342,864,000 | ||||||
Ending balance at Sep. 30, 2019 | 7,345,202 | $ 3,429 | 1,276,314 | (31,836) | 6,097,295 | ||
Beginning balance (in shares) at Dec. 31, 2018 | 352,303,000 | ||||||
Beginning balance at Dec. 31, 2018 | $ 7,018,358 | $ 3,523 | 1,515,572 | 33,515 | 5,465,748 | ||
Ending balance (in shares) at Dec. 31, 2019 | 339,201,748 | 339,202,000 | |||||
Ending balance at Dec. 31, 2019 | $ 7,318,620 | $ 3,392 | 1,173,262 | (26,693) | 6,168,659 | ||
Ending balance (ASU 2016-13) at Dec. 31, 2019 | $ (1,590,885) | $ (1,590,885) | |||||
Ending balance (ASU 2019-12) at Dec. 31, 2019 | $ (382) | $ (382) | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Accounting Standards Update [Extensible List] | ASU 2016-13 | us-gaap:AccountingStandardsUpdate201613Member | ||||||
Beginning balance (in shares) at Jun. 30, 2019 | 348,130,000 | ||||||
Beginning balance at Jun. 30, 2019 | $ 7,337,261 | $ 3,481 | 1,413,461 | (20,567) | 5,940,886 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Stock issued in connection with employee incentive compensation plans (in shares) | 214,000 | ||||||
Stock issued in connection with employee incentive compensation plans | 2,889 | $ 3 | 2,886 | ||||
Stock-based compensation expense | $ 931 | 931 | |||||
Stock repurchase/Treasury stock (in shares) | (5,479,650) | (5,480,000) | |||||
Stock repurchase/Treasury stock | $ (141,019) | $ (55) | (140,964) | ||||
Dividends-Common stock | (76,129) | (76,129) | |||||
Available-for-sale securities, net of taxes | (111) | (111) | |||||
Net income (loss) | 232,538 | 232,538 | |||||
Other comprehensive income (loss), net of taxes | (11,158) | (11,158) | |||||
Ending balance (in shares) at Sep. 30, 2019 | 342,864,000 | ||||||
Ending balance at Sep. 30, 2019 | $ 7,345,202 | $ 3,429 | 1,276,314 | (31,836) | 6,097,295 | ||
Beginning balance (in shares) at Dec. 31, 2019 | 339,201,748 | 339,202,000 | |||||
Beginning balance at Dec. 31, 2019 | $ 7,318,620 | $ 3,392 | 1,173,262 | (26,693) | 6,168,659 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Stock issued in connection with employee incentive compensation plans (in shares) | 340,000 | ||||||
Stock issued in connection with employee incentive compensation plans | (1,506) | $ 3 | (1,509) | ||||
Stock-based compensation expense | $ 6,161 | 6,161 | |||||
Stock repurchase/Treasury stock (in shares) | (33,471,268) | (33,471,000) | |||||
Stock repurchase/Treasury stock | $ (775,970) | $ (334) | (775,636) | ||||
Dividends-Common stock | (212,637) | (212,637) | |||||
Tax sharing with affiliate | (7,850) | (7,850) | |||||
Available-for-sale securities, net of taxes | 1,537 | 1,537 | |||||
Net income (loss) | 389,450 | 389,450 | |||||
Other comprehensive income (loss), net of taxes | $ (31,726) | (31,726) | |||||
Ending balance (in shares) at Sep. 30, 2020 | 306,070,972 | 306,071,000 | |||||
Ending balance at Sep. 30, 2020 | $ 5,094,812 | $ 3,061 | 394,428 | (56,882) | 4,754,205 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Accounting Standards Update [Extensible List] | us-gaap:AccountingStandardsUpdate201613Member | ||||||
Accounting Standards Update [Extensible List] | ASU 2019-12 | us-gaap:AccountingStandardsUpdate201912Member | ||||||
Beginning balance (in shares) at Jun. 30, 2020 | 316,235,000 | ||||||
Beginning balance at Jun. 30, 2020 | $ 4,895,465 | $ 3,162 | 624,554 | (63,705) | 4,331,454 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Stock issued in connection with employee incentive compensation plans (in shares) | 34,000 | ||||||
Stock issued in connection with employee incentive compensation plans | 237 | 237 | |||||
Stock-based compensation expense | $ 1,010 | 1,010 | |||||
Stock repurchase/Treasury stock (in shares) | (10,198,800) | (10,198,000) | |||||
Stock repurchase/Treasury stock | $ (223,516) | $ (101) | (223,415) | ||||
Dividends-Common stock | (67,364) | (67,364) | |||||
Tax sharing with affiliate | (7,958) | (7,958) | |||||
Available-for-sale securities, net of taxes | (289) | (289) | |||||
Net income (loss) | 490,115 | 490,115 | |||||
Other comprehensive income (loss), net of taxes | $ 7,112 | 7,112 | |||||
Ending balance (in shares) at Sep. 30, 2020 | 306,070,972 | 306,071,000 | |||||
Ending balance at Sep. 30, 2020 | $ 5,094,812 | $ 3,061 | $ 394,428 | $ (56,882) | $ 4,754,205 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (Parenthetical) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Statement of Stockholders' Equity [Abstract] | ||||
Dividends declared per common share (in dollars per share) | $ 0.22 | $ 0.22 | $ 0.66 | $ 0.62 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Cash flows from operating activities: | ||
Net income (loss) | $ 389,450 | $ 848,308 |
Adjustments to reconcile net income to net cash provided by operating activities | ||
Derivative mark to market | 10,022 | 14,027 |
Credit loss expense | 2,110,331 | 1,548,404 |
Depreciation and amortization | 1,726,356 | 1,439,818 |
Accretion of discount | (15,231) | (59,793) |
Originations and purchases of receivables held for sale | (1,637,194) | 0 |
Proceeds from sales of and collections on receivables held for sale | 545,293 | 101,914 |
Change in revolving personal loans, net | (59,096) | (144,411) |
Investment losses, net | 279,997 | 238,281 |
Stock-based compensation | 6,161 | 7,973 |
Deferred tax expense/(benefit) | 142,554 | 268,537 |
Changes in assets and liabilities: | ||
Accrued interest receivable | (153,199) | 6,637 |
Accounts receivable | 3,431 | (1,425) |
Federal income tax and other taxes | (14,145) | 8,161 |
Other assets | (39,721) | (12,792) |
Accrued interest payable | (13,237) | (1,508) |
Other liabilities | (29,830) | (46,675) |
Net cash provided by operating activities | 3,251,942 | 4,215,456 |
Cash flows from investing activities: | ||
Originations and purchases of portfolios, and disbursements on finance receivables held for investment | (12,782,253) | (12,193,605) |
Collections on finance receivables held for investment | 9,223,448 | 9,207,346 |
Proceeds from sale of loans held for investment | 803,614 | 0 |
Leased vehicles purchased | (4,891,504) | (6,754,501) |
Manufacturer incentives received | 339,717 | 643,552 |
Proceeds from sale of leased vehicles | 3,094,294 | 2,733,172 |
Change in revolving personal loans, net | 75,318 | 64,136 |
Purchases of available-for-sale securities | 0 | (85,098) |
Proceeds from repayments and maturities of available-for-sale securities | 0 | 6,000 |
Purchases of held-to-maturity investment securities | (54,584) | 0 |
Proceeds from repayments and maturities of held-to-maturity securities | 4,203 | 0 |
Purchases of furniture and equipment | (18,117) | (8,503) |
Sales of furniture and equipment | 3 | 334 |
Upfront fee paid to FCA | 0 | (60,000) |
Net cash used in investing activities | (4,205,861) | (6,447,167) |
Cash flows from financing activities: | ||
Proceeds from borrowings and other debt obligations, net of debt issuance costs - $11,545,000 and $6,515,000 from affiliates, respectively | 37,972,329 | 33,874,913 |
Payments on borrowings and other debt obligations - $(5,995,000) and $(4,765,000) to affiliates, respectively | (35,818,793) | (31,151,588) |
Proceeds from stock option exercises, gross | 673 | 4,441 |
Shares repurchased | (775,970) | (245,663) |
Dividends paid | (212,637) | (216,761) |
Net cash provided by (used in) financing activities | 1,165,602 | 2,265,342 |
Net increase (decrease) in cash and cash equivalents and restricted cash | 211,683 | 33,631 |
Cash and cash equivalents and restricted cash— Beginning of year | 2,161,087 | 2,250,484 |
Cash and cash equivalents and restricted cash— End of year | 2,372,770 | 2,284,115 |
Supplemental cash flow information: | ||
Total cash, cash equivalents and restricted cash | $ 2,372,770 | $ 2,284,115 |
CONDENSED CONSOLIDATED STATEM_6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Cash flows from financing activities: | ||
Proceeds from borrowings and other debt obligations, net of debt issuance costs, from affiliates | $ 11,545,000 | $ 6,515,000 |
Payments on borrowings and other debt obligations, to affiliates | $ (5,995,000) | $ (4,765,000) |
Description of Business, Basis
Description of Business, Basis of Presentation, and Accounting Policies | 9 Months Ended |
Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business, Basis of Presentation, and Significant Accounting Policies and Practices | Description of Business, Basis of Presentation, and Accounting Policies The Company is the holding company for SC Illinois, and its subsidiaries, a specialized consumer finance company focused on vehicle finance and third-party servicing and delivering service to dealers and customers across the full credit spectrum. The Company’s primary business is the indirect origination and servicing of retail installment contracts and leases, principally, through manufacturer-franchised dealers in connection with their sale of new and used vehicles to retail consumers. Additionally, the Company sells consumer retail installment contracts through flow agreements and, when market conditions are favorable, it accesses the ABS market through securitizations of consumer retail installment contracts. SAF is our primary vehicle financing brand, and is available as a finance option for automotive dealers across the United States. Since May 2013, under the Chrysler Agreement with FCA, the Company has operated as FCA’s preferred provider for consumer loans, leases and dealer loans and provides services to FCA customers and dealers under the CCAP brand. These products and services include consumer retail installment contracts and leases, as well as dealer loans for inventory, construction, real estate, working capital and revolving lines of credit. In 2019, the Company entered into an Amendment to the Chrysler Agreement with FCA, which modified that Agreement to, among other things, adjust certain performance metrics, exclusivity commitments and payment provisions. The Company also originates vehicle loans through a web-based direct lending program, purchases vehicle retail installment contracts from other lenders, and services automobile and recreational and marine vehicle portfolios for other lenders. Additionally, the Company has other relationships through which it provides other consumer finance products. As of September 30, 2020, the Company was owned approximately 80.2% by SHUSA, a subsidiary of Santander, and approximately 19.8% by other shareholders. The Company is taking numerous proactive steps to mitigate the negative financial and operational impacts of COVID-19. Business contingency plans have been implemented and will continue to be adjusted in response to the evolving global situation. Basis of Presentation The accompanying condensed consolidated financial statements include the accounts of the Company and its consolidated subsidiaries, including certain Trust that are considered VIEs. The Company also consolidates other VIEs for which it is deemed to be the primary beneficiary. All significant intercompany balances and transactions have been eliminated in consolidation. The accompanying condensed consolidated financial statements as of September 30, 2020 and December 31, 2019, and for the three and nine months ended September 30, 2020 and 2019, have been prepared in accordance with GAAP for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, these financial statements contain all adjustments, consisting of normal and recurring adjustments, necessary for the fair statement of the financial position, results of operations and cash flows for the periods indicated and contain adequate disclosure for the fair statement of this interim financial information. Results of operations for the periods presented herein are not necessarily indicative of results of operations for the entire year. These financial statements should be read in conjunction with the Annual Report on Form 10-K for the year ended December 31, 2019. Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts in the financial statements and accompanying notes. Actual results could differ from those estimates and those differences may be material. The most significant estimates include the determination of credit loss allowance, accretion of discounts and subvention, impairment, fair value measurements, expected end-of-term lease residual values, values of repossessed assets, and income taxes. These estimates, although based on actual historical trends and modeling, may show significant variances over time. Business Segment Information The Company has one reportable segment, Consumer Finance, which includes the Company’s vehicle financial products and services, including retail installment contracts, vehicle leases, and Dealer Loans, as well as financial products and services related to recreational vehicles and marine vehicles. It also includes the Company’s personal loan and point-of-sale financing operations. Recently Adopted Accounting Standards Since January 1, 2020, the Company adopted the following FASB ASUs: • Financial Instruments - Credit Losses (Topic 326) • In March 2020, the FASB issued ASU 2020-4, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. This guidance provides temporary optional expedients to reduce the costs and complexity associated with the high volume of contractual modifications expected in the transition away from LIBOR as the benchmark rate in contracts and hedges. These optional expedients allow entities to negate many of the accounting impacts of modifying contracts and hedging relationships necessitated by reference rate reform, allowing them to generally maintain the accounting as if a change had not occurred. The Company adopted this standard during the three months ended March 31, 2020, and will elect the practical expedients relative to the Company’s contracts and hedging relationships modified as a result of reference rate reform through December 31, 2022. These practical expedients did not have a material impact on the Company’s business, financial position, results of operations, or disclosures. • In December 2019, the FASB issued ASU 2019-12, Simplifying the Accounting for Income Taxes. The amendments in this ASU simplify the accounting for income taxes by removing certain exceptions to the general tax accounting principles and simplifying other specific tax scenarios. The Company early adopted this update as of January 1, 2020, and it did not have any material impact to the Company’s business, financial position, results of operations, or disclosures. The adoption of the following ASUs did not have a material impact on the Company’s business, financial position or results of operations. • ASU 2018-17, Consolidation (Topic 10): Targeted Improvements to Related Party Guidance for Variable Interest Entities • ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework- Changes to the Disclosure Requirements for Fair Value Measurement Accounting Policies There have been no material changes (except as disclosed below) in the Company's accounting policies from those disclosed in Part II, Item 8 - Financial Statements and Supplementary Data in the 2019 Annual Report on Form 10-K. The change in the following policy is as a result of the Company's adoption of CECL standard, on January 1, 2020. • Investment securities Debt securities expected to be held for an indefinite period of time are classified as AFS and recorded on the balance sheet at fair value. If the fair value of an AFS debt security declines below its amortized cost basis and the Company does not have the intention or requirement to sell the security before it recovers its amortized cost basis, declines due to credit factors will be recorded in earnings through the ACL for debt securities, and declines due to non-credit factors will be recorded in AOCI, net of taxes. Subsequent to recognition of a credit loss, improvements to the expectation of collectability will be reversed through the ACL for debt securities. If the Company has the intention or requirement to sell the security, the Company will record its fair value changes in earnings as a direct write down to the security. Increases in fair value above amortized cost basis are recorded in AOCI, net of taxes. The Company conducts an impairment assessment quarterly on all AFS securities with a fair value that is less than their amortized cost basis to determine whether the loss is due to credit factors. Securities for which management expects risk of nonpayment of the amortized cost basis is zero, do not have a reserve. The Company has a zero loss expectation when the securities are issued or guaranteed by certain US government entities, because these entities have a long history of no defaults and the highest credit ratings issued by rating agencies. In the event of a credit loss, the credit component of the impairment is recognized within non-interest income as a separate line item, and by the recording of a valuation reserve. The non-credit component is recorded within AOCI. • Purchased Credit Deteriorated or PCD loans Loans that the Company deems at acquisition to have more than insignificant deterioration in credit quality since origination (i.e., Purchased Credit Deteriorated or PCD loans) require the recognition of an allowance for credit losses at purchase. The allowance for credit losses is added to the purchase price at the date of acquisition to determine the initial amortized cost basis of the PCD loan. The allowance for credit losses is calculated using the same methodology as originated loans, as described below. Alternatively, the Company can elect the fair value option at the time of purchase for any financial asset. Under the FVO, loans are recorded at fair value with changes in value recognized immediately in income. There is no ACL for loans under an FVO. • Credit Loss Expense and Allowance for Credit losses General Credit loss expenses are charged to operations in amounts sufficient to maintain the ACL at levels considered adequate to cover expected credit losses in the Company’s retail installment contracts. The allowance for expected credit losses on retail installment contracts is measured based on a lifetime expected loss model, which means that it is not necessary for a loss event to occur before a credit loss is recognized. Management’s estimate of expected credit losses is based on an evaluation of relevant information about past events, current conditions, and reasonable and supportable forecasts that affect the future collectability of the reported amounts. Management's evaluation takes into consideration the risks in the portfolio, past loss experience, specific loans with loss potential, geographic and industry concentrations, delinquency trends, economic forecasts and other relevant factors. While management uses the best information available to make such evaluations, future adjustments to the ACL may be necessary if conditions differ substantially from the assumptions used in making the evaluations. The Company measures expected losses of all components on an amortized cost basis. For all loans except TDRs, the Company has elected to exclude accrued interest receivable balances from the measurement of expected credit losses because it applies a nonaccrual policy that results in the timely write off of uncollectible accrued interest. For loans on nonaccrual status, interest income is recognized on a cash basis, and the accrual of interest is resumed and reinstated if a delinquent account subsequently becomes 60 days or less past due. Methodology The Company uses several methodologies for the measurement of ACL. The ACL is made up of a quantitative and a qualitative component. To determine the quantitative component, the Company generally uses a DCF approach for determining ACL for TDRs and other individually assessed loans, and a non-DCF approach for other loans. Expected credit losses are estimated on an individual basis only if the individual asset or exposure does not share similar risk attributes with other financial assets or exposures, including when an asset is treated as a collateral dependent asset. The ACL estimate includes significant assumptions including the reasonable and supportable economic forecast period, which considers the availability of forward-looking scenarios and their respective time horizons, as well as the reversion method to historical losses. This method results in a single, quantitatively consistent credit model across the entire projection period as the macroeconomic effects in the historical data are controlled for the estimate of the long-run loss level. Models The Company uses a statistical methodology based on an ECL approach that focuses on forecasting the ECL components (i.e., probability of default, payoff, loss given default and exposure at default) on a loan level basis to estimate the expected future life time losses. The individual loan balances used in the models are measured on an amortized cost basis. • In calculating the probability of default and payoff, the Company developed model forecasts, which consider variables such as delinquency status, loan tenor and other credit quality indicators. • The loss given default component forecasts the extent of losses given that a default has occurred and considers variables such as collateral, loan-to-value and other credit quality indicators. • The exposure at default component captures the effects of expected partial prepayments and underpayments that are expected to occur during the forecast period and considers variable such as loan-to-value, collateral and other credit quality indicators. The above ECL components are used to compute an ACL based on the weighted average of the results of the macroeconomic scenarios. The weighting of these scenarios is governed and approved quarterly by management through established committee governance. These ECL components are inputs to both the Company’s DCF approach for TDR and individually assessed loans and non-DCF approach for other loans. When using a non-DCF method to measure the ACL, the Company measures ECL over the asset’s contractual term, adjusted for (a) expected prepayments; (b) expected extensions associated with assets for which management has a reasonable expectation at the reporting date that it will execute a TDR with the borrower; and (c) expected extensions or renewal options (excluding those that are accounted for as derivatives) included in the original or modified contract at the reporting date that are not unconditionally cancellable by the entity. DCF approaches A DCF method measures expected credit losses by forecasting expected future principal and interest cash flows and discounting them using the financial asset’s EIR. The ACL reflects the difference between the amortized cost basis (including accrued interest) and the present value of the expected cash flows. When using a DCF method to measure the ACL, the period of exposure is determined as a function of the Company’s expectations of the timing of principal and interest payments. The Company considers estimated prepayments in the future principal and interest cash flows when utilizing a DCF Method. The Company generally uses a DCF approach for TDRs. Collateral - Dependent Assets A loan is considered a Collateral Dependent Financial Asset when (a) the Company determines foreclosure is probable or (b) the borrower is experiencing financial difficulty and the Company expects repayment to be provided substantially through the operation or sale of the collateral. For all collateral dependent loans such as certain bankruptcy modifications, the Company measures the ACL as the difference between the loan’s amortized cost basis and the fair value of the underlying collateral as of the reporting date, adjusted for expected costs to sell. If repayment or satisfaction of the loan is dependent only on the operation, rather than the sale, of the collateral, the measure of credit losses does not incorporate estimated costs to sell. The collateral dependent loan is written down (i.e. charged off) to the fair value of the collateral adjusted for costs to sell (if repayment from sale is expected.) Any subsequent increase or decrease in the collateral’s fair value less cost to sell is recognized as an adjustment to the related loan’s ACL. Negative allowance Negative allowance is defined as the amount of future recovery expected for accounts that have already been charged-off. The Company performs an analysis of the actual historical recovery values to determine the pattern of recovery and expected rate of recovery over a given historic period, and uses the results of this analysis to determine negative allowance. Negative allowance reduces the ACL. Qualitative Reserve Regardless of the extent of the Company's analysis of customer performance, portfolio evaluations, trends or risk management processes established, a level of imprecision will always exist due to the judgmental nature of loan portfolio and/or individual loan evaluations. The Company maintains a qualitative reserve as a component of the ACL to recognize the existence of these exposures. Imprecisions include loss factors inherent in the loan portfolio that may not have been discreetly contemplated in deriving the quantitative component of the allowance, as well as potential variability in estimates. The qualitative adjustment is also established in consideration of several factors such as the interpretation of economic trends, changes in the nature and volume of our loan portfolio, trends in delinquency and collateral values, and concentration risks. This analysis is conducted at least quarterly, and the Company revises the qualitative component of the allowance when necessary in order to address improving or deteriorating credit quality trends or specific risks associated with loan pool classification, not otherwise captured in the quantitative models. Governance A comprehensive analysis of the ACL is performed by the Company on a quarterly basis. Management regularly monitors the condition of borrowers and assesses both internal and external factors in determining whether any relationships have deteriorated considering factors such as historical loss experience, trends in delinquency, changes in risk composition and underwriting standards, experience and ability of staff and regional and national economic conditions, trends and forecasts. Risk factors are continuously reviewed and revised by management when conditions warrant. The Company's reserves are principally based on various models subject to the Company's model risk management framework. New models are approved by the SHUSA's Model Risk Management Committee. Models, inputs and documentation are further reviewed and validated at least annually, and the Company completes a detailed variance analysis of historical model projections against actual observed results on a quarterly basis. Required actions resulting from the Company's analysis, if necessary, are governed by its ACL Committee. Reserve levels are collectively reviewed for adequacy and approved quarterly by Board-level committees. Changes in the assumptions used in these estimates could have a direct material impact on the credit loss expense in the Consolidated Statements of Operations and in the allowance for credit losses. The loan portfolio represents the largest asset on the Consolidated Balance Sheets. The Company’s models incorporate a variety of assumptions based on historical experience, current conditions and forecasts. Management also applies its judgement in evaluating the appropriateness of the allowance. Material change to the ACL might be necessary if prevailing conditions differ materially from the assumptions and estimates utilized in calculating the ACL. Recently Issued Accounting Standards Not Yet Adopted There are no recently issued GAAP accounting developments that we expect will have a material impact on the Company's business, financial position, results of operations, or disclosures upon adoption. |
Finance Receivables
Finance Receivables | 9 Months Ended |
Sep. 30, 2020 | |
Receivables [Abstract] | |
Finance Receivables | Finance Receivables Held for Investment Finance receivables held for investment, net is comprised of the following at September 30, 2020 and December 31, 2019: September 30, 2020 December 31, 2019 Retail installment contracts, net (a) $ 27,415,437 $ 27,719,221 Purchased receivables - credit deteriorated 7,438 12,177 Receivables from dealers 3,668 12,536 Finance lease receivables (Note 4) 23,187 23,085 Finance receivables held for investment, net $ 27,449,730 $ 27,767,019 (a) The Company has elected the fair value option for certain retail installment contracts reported in finance receivables held for investment, net. As of September 30, 2020 and December 31, 2019, $8,248 and $22,353 of loans were recorded at fair value, respectively (Note 10). The Company’s held for investment portfolio of retail installment contracts is comprised of the following at September 30, 2020 and December 31, 2019: September 30, 2020 Retail Installment Contracts Non-TDR TDR Unpaid principal balance $ 29,667,444 $ 3,801,948 ACL (4,900,132) (1,248,522) Discount (net of subvention and participation) 1,004 (10,583) Capitalized origination costs and fees 100,750 3,528 Net carrying balance $ 24,869,066 $ 2,546,371 ACL as a percentage of unpaid principal balance 16.5 % 32.8 % ACL and discount as a percentage of unpaid principal balance 16.5 % 33.1 % December 31, 2019 Retail Installment Contracts Non-TDR TDR Unpaid principal balance $ 26,895,551 $ 3,859,040 Credit loss allowance - specific — (914,718) Credit loss allowance - collective (2,123,878) — Discount (net of subvention and participation) (67,484) (17,167) Capitalized origination costs and fees 84,961 2,916 Net carrying balance $ 24,789,150 $ 2,930,071 Allowance as a percentage of unpaid principal balance 7.9 % 23.7 % Allowance and discount as a percentage of unpaid principal balance 8.1 % 24.1 % Retail installment contracts Retail installment contracts are collateralized by vehicle titles, and the Company has the right to repossess the vehicle in the event the consumer defaults on the payment terms of the contract. Most of the Company’s retail installment contracts held for investment are pledged against warehouse lines or securitization bonds (Note 7). Most of the borrowers on the Company’s retail installment contracts held for investment are retail consumers; however, $823,955 and $741,592 of the unpaid principal balance represented fleet contracts with commercial borrowers as of September 30, 2020 and December 31, 2019, respectively. During the nine months ended September 30, 2020 and 2019, the Company originated (including through the SBNA originations program) $11,145,890 and $9,514,939, respectively, in CCAP loans which represented 61% and 56%, respectively, of the total retail installment contract originations (including the SBNA originations program). As of September 30, 2020, borrowers on the Company’s retail installment contracts held for investment are located in Texas (16%), Florida (10%), California (8%), Georgia (5%) and other states each individually representing less than 5% of the Company’s total portfolio. Purchased receivables During the three and nine months ended September 30, 2020 and 2019, the Company did not acquire any vehicle loan portfolios from third party lenders. For the nine months ended September 30, 2020 and 2019, the Company recognized certain retail installment contracts with an unpaid principal balance of $76,878 and $74,718 respectively. For the three months ended September 30, 2020 and 2019, there were no retail installment contracts with an unpaid principal balance. held by non-consolidated securitization Trusts, under optional clean-up calls (Note 6). Following the initial recognition of these loans at fair value, the performing loans in the portfolio are carried at amortized cost, net of allowance for credit losses. The Company elected the fair value option for all non-performing loans acquired (more than 60 days delinquent as of the re-recognition date), for which it was probable that not all contractually required payments would be collected (Note 10). Receivable from Dealers The receivables from dealers held for investment are all Chrysler Agreement-related. As of September 30, 2020, borrowers on these dealer receivables are located in New York. Held for Sale The carrying value of the Company’s finance receivables held for sale, net is comprised of the following at September 30, 2020 and December 31, 2019: September 30, 2020 December 31, 2019 Personal loans $ 763,292 $ 1,007,105 Sales of retail installment contracts to third parties and proceeds from sales of charged-off assets for the three and nine months ended September 30, 2020 and 2019 were as follows: Three Months Ended Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Sales of retail installment contracts to third parties $ 636,301 $ — $ 1,148,587 $ — Proceeds from sales of charged-off assets to third parties $ 9,144 $ 28,847 $ 30,019 $ 55,220 |
Credit Loss Allowance and Credi
Credit Loss Allowance and Credit Quality | 9 Months Ended |
Sep. 30, 2020 | |
Loans and Leases Receivable Disclosure [Abstract] | |
Credit Loss Allowance and Credit Quality | Credit Loss Allowance and Credit Quality Credit Loss Allowance During the first quarter of 2020, the Company changed the model used for estimating the ACL on retail installment contracts from incurred loss model to an expected lifetime loss model, as a result of the Company's adoption of the CECL standard on January 1, 2020. The Company maintains an ACL on the retail installment contracts held for investment, which excludes those loans measured at fair value in accordance with applicable accounting standards. The Company maintains an expected ACL for receivables from dealers based on risk ratings and individually evaluates loans for specific impairment as necessary. As of September 30, 2020 and 2019, the ACL for receivables from dealers is comprised entirely of general allowance as none of these receivables have been determined to be individually impaired. The Company estimates losses on the finance lease receivable portfolio based on delinquency status, loss experience to date, future expectation of losses as well as various economic factors. Retail installment contracts The activity in the ACL for the retail installment contracts for the three and nine months ended September 30, 2020 and 2019 was as follows: Three Months Ended September 30, 2020 Three Months Ended September 30, 2019 Retail Installment Contracts Retail Installment Contracts Non-TDR TDR Non-TDR TDR Balance — beginning of period $ 4,818,187 $ 1,037,628 $ 1,961,893 $ 1,156,303 Credit loss expense (a) 24,841 314,075 484,626 102,494 Charge-offs (b) (334,938) (200,352) (962,573) (381,490) Recoveries 392,042 97,171 567,846 183,305 Balance — end of period $ 4,900,132 $ 1,248,522 $ 2,051,792 $ 1,060,612 Nine Months Ended September 30, 2020 Nine Months Ended September 30, 2019 Retail Installment Contracts Retail Installment Contracts Non-TDR TDR Non-TDR TDR Balance — beginning of period $ 2,123,878 $ 914,718 $ 1,819,360 $ 1,416,743 Day 1 - Adjustment to allowance for adoption of CECL standard 2,030,473 71,833 — — Credit loss expense (a) 1,526,545 581,344 1,279,931 266,913 Charge-offs (b) (1,955,706) (617,536) (2,685,931) (1,217,650) Recoveries 1,174,942 298,163 1,638,432 594,606 Balance — end of period $ 4,900,132 $ 1,248,522 $ 2,051,792 $ 1,060,612 (a) Excluded from the credit loss expense is $13 million and $52 million related to retail installment contracts sold in an off-balance sheet securitization during the three and nine months ended September 30, 2020, respectively. In addition, credit loss expense includes a net of $72 million and $60 million in the credit loss expense related to retail installment contracts transferred to held for sale and returned to held for investment during the three and nine months ended September 30, 2020, respectively. Furthermore, credit loss expense includes $0 million and $20 million related to retail installment contracts transferred to held for sale during the three and nine months ended September 30, 2019, respectively. (b) Charge-offs for retail installment contracts includes partial write-down of loans to the collateral value less estimated costs to sell, for which a bankruptcy notice was received. There is no additional ACL on these loans. The credit risk in the Company’s loan portfolios is driven by credit and collateral quality, and is affected by borrower-specific and economy-wide factors. In general, there is an inverse relationship between credit quality of loans and projections of impairment losses so that loans with better credit quality require a lower expected loss. The Company manages this risk through its underwriting, pricing strategies, credit policy standards, and servicing guidelines and practices, as well as the application of geographic and other concentration limits. The Company estimates lifetime expected losses based on prospective information as well as account level models based on historical data. Unemployment, HPI, and used vehicle index growth rates, along with loan level characteristics, are the key inputs used in the models for prediction of the likelihood that the borrower will default in the forecasted period (the probability of default). The used vehicle index is also used to estimate the loss in the event of default. The historic volume of loan deferrals provided to customers impacted by COVID-19 has driven positive trends in delinquencies and severity (charge-offs) in the quarter, however, the inclusion of key loan characteristics as inputs to the models (including number of extensions) and management’s evaluation of qualitative factors ensure the allowance is appropriate. The Company has determined the reasonable and supportable period to be three years at which time economic forecasts generally tend to revert to historical averages. The Company utilizes qualitative factors to capture any additional risks that may not be captured in either the economic forecasts or in the historical data, including consideration of the current levels of delinquency, charge-offs and used vehicle prices. The Company generally uses a third-party vendor's consensus baseline macroeconomic scenario for the quantitative estimate and additional positive and negative macroeconomic scenarios to make qualitative adjustment for macroeconomic uncertainty, and may consider adjustments to macroeconomic inputs based on market volatility. The baseline scenario was based on the latest consensus forecasts available which show an improvement in key variables in this quarter, including a sharp decrease in unemployment rates (which are a key driver to losses). The scenarios are periodically updated over a reasonable and supportable time horizon with weightings assigned by management and approved through established committee governance. The Company’s ACL increased $0.3 billion and $3.1 billion for the three and nine months ended September 30, 2020. For the three months ended September 30, 2020, the increase was primarily due to portfolio growth. For the nine months ended September 30, 2020, the primary drivers were a $2.1 billion increase at CECL adoption on January 1, 2020, driven mainly by the addition of lifetime expected credit losses for non-TDR loans, and additional reserves specific to COVID-19 risk. Other portfolios The ACL for the period end and its activity for Dealer Loans, Finance Lease receivable portfolio, and Purchased receivable portfolio-credit deteriorated, for the three and nine months ended September 30, 2020 and 2019, is insignificant. Delinquencies Retail installment contracts and personal amortizing term loans are generally classified as non-performing (or nonaccrual) when they are greater than 60 days past due as to contractual principal or interest payments. Dealer receivables are classified as non-performing when they are greater than 90 days past due. At the time a loan is placed in non-performing (nonaccrual) status, previously accrued and uncollected interest is reversed against interest income. If an account is returned to a performing (accrual) status, the Company returns to accruing interest on the loan. When an account is deferred, the loan is returned to accrual status during the deferral period and accrued interest related to the loan is evaluated for collectability. The Company considers an account delinquent when an obligor fails to pay substantially all (defined as 90%) of the scheduled payment by the due date. In each case, the period of delinquency is based on the number of days payments are contractually past due. A summary of delinquencies as of September 30, 2020, and December 31, 2019 is as follows: September 30, 2020 Finance Receivables Held for Investment Retail Installment Contract Loans Purchased Receivables Portfolios - credit deteriorated Total Percent Amortized cost, 30-59 days past due $ 1,673,713 $ 887 $ 1,674,600 5.0 % Amortized cost over 59 days 817,577 334 817,911 2.4 % Total delinquent balance at amortized cost (a) $ 2,491,290 $ 1,221 $ 2,492,511 7.4 % (a) The amount of accrued interest excluded from the disclosed amortized cost table is $64,970. December 31, 2019 Finance Receivables Held for Investment Retail Installment Contract Loans Purchased Receivables Portfolios - credit impaired Total Percent Principal, 30-59 days past due $ 2,972,495 $ 1,930 $ 2,974,425 9.7 % Delinquent principal over 59 days 1,578,452 1,596 1,580,048 5.1 % Total delinquent principal (a) $ 4,550,947 $ 3,526 $ 4,554,473 14.8 % (a) The table includes balances based on UPB. Difference between amortized cost and UPB was not material. As of September 30, 2020 and December 31, 2019, there were no receivables from dealers that were 30 days or more delinquent. The accrual of interest on revolving personal loans continues until the loan is charged off. The unpaid principal balance on revolving personal loans 90 days past due and still accruing totaled $64,358 and $128,872 as of September 30, 2020 and December 31, 2019, respectively. Non-Accrual Loans for Retail Installment Contracts The amortized cost basis of financial instruments that are either non-accrual with related expected credit loss or non-accrual without related expected credit loss for retail installment contracts is as follows: September 30, 2020 Non-accrual loans Non-accrual loans with no allowance (a) Interest income recognized on nonaccrual loans (YTD) Non-accrual loans as a percent of total amortized cost Non-TDR $ 623,428 $ 141,269 $ 57,275 1.9 % TDR 301,647 46,956 27,128 0.9 % Total non-accrual loans $ 925,075 $ 188,225 $ 84,403 2.8 % (a) These represent loans for which a bankruptcy notice was received, and have been partially write-down to the collateral value less estimated costs to sell. Accordingly, there is no additional ACL on these loans. December 31, 2019 Amount Percent Non-TDR $ 1,099,462 3.6 % TDR 516,119 1.7 % Total nonaccrual principal (a) $ 1,615,581 5.3 % (a) The table includes balances based on UPB. Difference between amortized cost and UPB was not material. Delinquent balances and nonaccrual balances are lower as of September 30, 2020 primarily due to a significant increase in deferrals granted to borrowers impacted by COVID-19. Credit Quality Indicators FICO® Distribution (determined at origination) — Amortized Cost Basis (in millions) by Origination Year for Retail Installment Contacts Total September 30, 2020 2020 (a) 2019 2018 2017 2016 2015 Prior Amount % No-FICO ® s 1,395 1,318 608 595 305 174 40 4,435 13.2% <540 1,444 1,517 1,022 516 305 223 116 5,143 15.3% 540-599 3,307 3,345 1,960 768 495 322 127 10,324 30.7% 600-639 2,101 2,059 1,120 384 272 158 65 6,159 18.4% >640 4,226 1,592 922 308 244 163 48 7,503 22.4% Total (b) $ 12,473 $ 9,831 $ 5,632 $ 2,571 $ 1,621 $ 1,040 $ 396 $ 33,564 100.0% (a) Represents nine months ended September 30, 2020 (b) The amount of accrued interest excluded from the disclosed amortized cost table is $428 million . FICO® Band December 31, 2019 (a) No-FICO®s 12.4% <540 16.9% 540-599 31.9% 600-639 19.0% >640 19.8% (a) Percentages are based on UPB. Difference between amortized cost and UPB was not material. Commercial Lending — The Company’s risk department performs a credit analysis and classifies certain loans over an internal threshold based on the commercial lending classifications. All the receivables from dealers, as of September 30, 2020 and December 31, 2019 were classified as “Pass.” Troubled Debt Restructurings In certain circumstances, the Company modifies the terms of its finance receivables to troubled borrowers. Modifications may include a temporary reduction in monthly payment, reduction in interest rate, an extension of the maturity date, rescheduling of future cash flows, or a combination thereof. A modification of finance receivable terms is considered a TDR if the Company grants a concession to a borrower for economic or legal reasons related to the debtor’s financial difficulties that would not otherwise have been considered. The purchased receivables portfolio - credit deteriorated, operating and finance leases, and loans held for sale, including personal loans, are excluded from the scope of the applicable guidance. The Company’s TDR balance as of September 30, 2020 and December 31, 2019 primarily consisted of loans that had been deferred or modified to receive a temporary reduction in monthly payment. As of September 30, 2020 and December 31, 2019, there were no receivables from dealers classified as a TDR. A loan that has been classified as a TDR remains so until the loan is liquidated through payoff or charge-off. The recognition of interest income on TDR loans reflects management’s best estimate of the amount that is reasonably assured of collection and is consistent with the estimate of future cash flows used in the impairment measurement. Any accrued but unpaid interest is fully reserved for through the recognition of additional impairment, if not expected to be collected. The table below presents the Company’s amortized cost (including accrued interest) of TDRs as of September 30, 2020 and December 31, 2019: September 30, 2020 December 31, 2019 Retail Installment Contracts (a) Amortized Cost including accrued interest (b) $ 3,843,470 $ 3,828,892 Impairment (1,248,522) (914,718) Amortized cost including accrued interest, net of impairment $ 2,594,948 $ 2,914,174 (a) The December 31, 2019 balances were based on unpaid principal balance. Difference between amortized cost and UPB was not material. (b) As of September 30, 2020, these balances excludes $74.0 million of collateral-dependent bankruptcy TDRs that have been written down by $27.1 million to fair value less cost to sell. As of December 31, 2019, this balance excludes $94.9 million of collateral-dependent bankruptcy TDRs that have been written down by $36.4 million to fair value less cost to sell. A summary of the amortized cost (including accrued interest) of the Company’s delinquent TDRs at September 30, 2020 and December 31, 2019 is as follows: September 30, 2020 December 31, 2019 Retail Installment Contracts (a) 30-59 days past due $ 564,838 $ 927,952 Delinquent balance over 59 days 287,289 521,709 Total delinquent TDRs $ 852,127 $ 1,449,661 (a) The December 31, 2019 balances were based on unpaid principal balance. Difference between amortized cost and UPB was not material. The decrease in total delinquent TDRs is primarily due to the significant increase in deferrals granted to borrowers impacted by COVID-19. The additional risk of these deferrals is captured in the ACL for retail installment contracts for the three and nine months ended September 30, 2020. Average amortized cost (including accrued interest) and interest income recognized on TDR loans are as follows: Three Months Ended Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Retail Installment Contracts Retail Installment Contracts Average amortized cost (including accrued interest) $ 3,960,119 $ 4,399,099 $ 3,802,823 $ 4,790,378 Interest income recognized 165,637 188,331 457,642 623,324 The following table summarizes the financial effects, excluding impacts related to credit loss allowance and impairment, of TDRs (including collateral-dependent bankruptcy TDRs) that occurred for the three and nine months ended September 30, 2020 and 2019: Three Months Ended Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Retail Installment Contracts Retail Installment Contracts Amortized cost (including accrued interest) before TDR $ 317,455 $ 376,206 $ 1,399,813 $ 1,003,755 Amortized cost (including accrued interest) after TDR 319,027 377,750 1,417,480 1,006,637 Number of contracts (not in thousands) 14,620 21,575 69,786 58,783 A TDR is considered to be in default at charge off. For retail installment contracts, charge off is at the earlier of the date of repossession or 120 days past due and, for revolving personal loans, is generally the month in which the receivable becomes 180 days past due. Loan restructurings accounted for as TDRs within the previous twelve months that subsequently defaulted during the three and nine months ended September 30, 2020 and 2019 are summarized in the following table: Three Months Ended Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Retail Installment Contracts Retail Installment Contracts Amortized cost (including accrued interest) in TDRs that subsequently defaulted (a) $ 83,002 $ 83,254 $ 183,871 $ 299,619 Number of contracts (not in thousands) 4,379 5,190 10,467 18,097 (a) For TDR modifications and TDR modifications that subsequently default, the allowance methodology remains unchanged; however, the transition rates of the TDR loans are adjusted to reflect the respective risks. |
Leases (SC as Lessor)
Leases (SC as Lessor) | 9 Months Ended |
Sep. 30, 2020 | |
Leases [Abstract] | |
Leases (SC as Lessor) | Leases (SC as Lessor) The Company originates operating and finance leases, which are separately accounted for and recorded on the Company’s condensed consolidated balance sheets. Operating leases are reported as leased vehicles, net, while finance leases are included in finance receivables held for investment, net. Lease extensions granted by the Company are not treated as modifications. Income continues to accrue during the extension period and remaining lease payments are recorded on a straight-line basis over the modified lease term. Operating Leases Leased vehicles, net, which is comprised of leases originated under the Chrysler Agreement, consisted of the following as of September 30, 2020 and December 31, 2019: September 30, 2020 December 31, 2019 Leased vehicles $ 21,795,939 $ 21,722,726 Less: accumulated depreciation (4,694,217) (4,159,944) Depreciated net capitalized cost 17,101,722 17,562,782 Manufacturer subvention payments, net of accretion (972,778) (1,177,342) Origination fees and other costs 66,432 76,542 Net book value $ 16,195,376 $ 16,461,982 The following summarizes the maturity analysis of lease payments due to the Company as lessor under operating leases as of September 30, 2020: Remainder of 2020 $ 745,650 2021 2,304,011 2022 1,218,588 2023 428,287 2024 7,852 Thereafter — Total $ 4,704,388 Finance Leases Certain leases originated by the Company are accounted for as direct financing leases, as the contractual residual values are nominal amounts. Finance lease receivables, net consisted of the following as of September 30, 2020 and December 31, 2019: September 30, 2020 December 31, 2019 Gross investment in finance leases $ 34,290 $ 34,443 Origination fees and other 288 241 Less: unearned income (7,673) (6,859) Net investment in finance leases before allowance 26,905 27,825 Less: allowance for lease losses (a) (3,718) (4,740) Net investment in finance leases $ 23,187 $ 23,085 (a) The impact of day 1 - Adjustment to allowance for adoption of CECL standard was insignificant. The following summarizes the maturity analysis of lease payments due to the Company, as lessor, under finance leases as of September 30, 2020: Remainder of 2020 $ 2,685 2021 10,066 2022 8,793 2023 6,780 2024 4,262 Thereafter 1,704 Total $ 34,290 |
Leases (SC as Lessor) | Leases (SC as Lessor) The Company originates operating and finance leases, which are separately accounted for and recorded on the Company’s condensed consolidated balance sheets. Operating leases are reported as leased vehicles, net, while finance leases are included in finance receivables held for investment, net. Lease extensions granted by the Company are not treated as modifications. Income continues to accrue during the extension period and remaining lease payments are recorded on a straight-line basis over the modified lease term. Operating Leases Leased vehicles, net, which is comprised of leases originated under the Chrysler Agreement, consisted of the following as of September 30, 2020 and December 31, 2019: September 30, 2020 December 31, 2019 Leased vehicles $ 21,795,939 $ 21,722,726 Less: accumulated depreciation (4,694,217) (4,159,944) Depreciated net capitalized cost 17,101,722 17,562,782 Manufacturer subvention payments, net of accretion (972,778) (1,177,342) Origination fees and other costs 66,432 76,542 Net book value $ 16,195,376 $ 16,461,982 The following summarizes the maturity analysis of lease payments due to the Company as lessor under operating leases as of September 30, 2020: Remainder of 2020 $ 745,650 2021 2,304,011 2022 1,218,588 2023 428,287 2024 7,852 Thereafter — Total $ 4,704,388 Finance Leases Certain leases originated by the Company are accounted for as direct financing leases, as the contractual residual values are nominal amounts. Finance lease receivables, net consisted of the following as of September 30, 2020 and December 31, 2019: September 30, 2020 December 31, 2019 Gross investment in finance leases $ 34,290 $ 34,443 Origination fees and other 288 241 Less: unearned income (7,673) (6,859) Net investment in finance leases before allowance 26,905 27,825 Less: allowance for lease losses (a) (3,718) (4,740) Net investment in finance leases $ 23,187 $ 23,085 (a) The impact of day 1 - Adjustment to allowance for adoption of CECL standard was insignificant. The following summarizes the maturity analysis of lease payments due to the Company, as lessor, under finance leases as of September 30, 2020: Remainder of 2020 $ 2,685 2021 10,066 2022 8,793 2023 6,780 2024 4,262 Thereafter 1,704 Total $ 34,290 |
Other Assets
Other Assets | 9 Months Ended |
Sep. 30, 2020 | |
Other Assets, Leases And Investments [Abstract] | |
Other Assets | Other Assets Other assets were comprised as follows: September 30, 2020 December 31, 2019 Vehicles (a) $ 370,678 $ 341,465 Manufacturer subvention payments receivable (b) 38,414 74,738 Upfront fee (b) 76,709 98,980 Derivative assets at fair value (c) 5,999 65,358 Derivative - collateral 104,435 147,914 Operating leases (Right-of-use-assets) 49,443 57,508 Available-for-sale debt securities 95,666 92,246 Held-to-maturity debt securities (d) 50,417 — Equity securities not held for trading 1,430 — Prepaids 44,458 45,644 Accounts receivable 34,898 24,103 Federal and State tax receivable 104,667 82,945 Other 65,451 40,119 Other assets $ 1,042,665 $ 1,071,020 (a) Includes vehicles recovered through repossession as well as vehicles recovered due to lease terminations. (b) These amounts relate to the Chrysler Agreement. The Company paid a $150,000 upfront fee upon the May 2013 inception of the Chrysler Agreement. The fee is being amortized into finance and other interest income over a ten (c) Derivative assets at fair value represent the gross amount of derivatives presented in the condensed consolidated financial statements. Refer to Note 9 - "Derivative Financial Instruments" to these condensed Consolidated Financial Statements for the detail of these amounts. (d) Held-to-maturity debt securities includes accrued interest as of September 30, 2020. Operating Leases (SC as Lessee) The Company has entered into various operating leases, primarily for office space. Operating leases are included within other assets as operating lease ROU assets and other liabilities within our consolidated balance sheets. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Most of our real estate leases include one or more options to renew, with renewal terms that can extend the lease term from one year to 15 years or more. The exercise of lease renewal options is at our sole discretion. The Company does not include any of the renewal options in the lease term as it is not reasonably certain that these options will be exercised. Supplemental information relating to these operating leases is as follows: September 30, 2020 Operating leases-right of use assets $ 49,443 Other liabilities 68,545 Weighted average lease term 5.6 Weighted average discount rate 3.4 % Lease expense i ncurred totaled $3,479 and $3,402 for the three months ended September 30, 2020 and 2019, respectively, and $10,586 and $10,316 for the nine months ended September 30, 2020 and 2019, and is included within “other operating costs” in the income statement. Leases with an initial term of 12 months or less are not recorded on the balance sheet; we recognize lease expense for these leases on a strai ght-line basis over the lease term. Cash paid for amounts included in the measurement of operating lease liabilities was $12,947 d uring the nine months ended September 30, 2020. The maturity of lease liabilities at September 30, 2020 are as follows: September 30, 2020 2020 $ 4,175 2021 13,343 2022 12,639 2023 12,762 2024 12,701 Thereafter 19,691 Total $ 75,311 Less: Interest (6,766) Present value of lease liabilities $ 68,545 Available-for-sale and Held-to-maturity debt securities Debt securities expected to be held for an indefinite period of time are classified as AFS and are carried at fair value, with temporary unrealized gains and losses reported as a component of accumulated other comprehensive income within stockholder's equity, net of estimated income taxes. All of these securities are used to satisfy collateral requirements for our derivative financial instruments. Debt securities that the Company has the positive intent and ability to hold until maturity are classified as HTM securities. HTM securities are reported at cost and adjusted for payments, charge-offs, amortization of premium and accretion of discount. Realized gains and losses on sales of investment securities are recognized on the trade date and are determined using specific identification method and are included in earnings within Investment gain (losses) on sale of securities. Unamortized premiums and discounts are recognized in interest income over the estimated life of the security using the interest method. The following tables present the amortized cost, gross unrealized gains and losses and approximate fair values of debt securities available-for-sale and held-to-maturity debt securities as of September 30, 2020: September 30, 2020 Amortized cost (before unrealized gains / losses) Gross Unrealized gain Gross Unrealized loss Fair value Available-for-sale debt securities (US Treasury securities) $ 92,621 $ 3,045 $ — $ 95,666 Held-to-maturity debt securities (Asset-Backed Notes) $ 50,381 $ 561 $ — $ 50,942 Contractual Maturities The contractual maturities of available-for-sale and held-to-maturity debt instruments are summarized in the following table: September 30, 2020 Available-for-sale debt securities Held-to-maturity debt securities Amortized cost Fair value Amortized cost Fair value Due within one year $ 4,978 $ 5,096 $ 3,416 $ 3,416 Due after one year but within 5 years 87,643 90,570 34,178 34,320 Due after 5 year but within 10 years — — 12,787 13,206 Total $ 92,621 $ 95,666 $ 50,381 $ 50,942 There we re no transfers o f securities between available-for-sale and held-to-maturity during the periods ended September 30, 2020 or December 31, 2019 . Other Investments Other investments includes the equity securities not held for trading as 5% of certificate related to the off-balance sheet securitization. Equity securities are measured at fair value as of September 30, 2020 for $1,430, with ch |
Variable Interest Entities
Variable Interest Entities | 9 Months Ended |
Sep. 30, 2020 | |
Variable Interest Entity Disclosure [Abstract] | |
Variable Interest Entities | Variable Interest Entities The Company transfers retail installment contracts and vehicle leases into newly formed Trusts that then issue one or more classes of notes payable backed by the collateral. The Company’s continuing involvement with these Trusts is in the form of servicing the assets and, generally, through holding residual interests in the Trusts. The Trusts are considered VIEs under GAAP and the Company may or may not consolidate these VIEs on the condensed consolidated balance sheets. For further description of the Company’s securitization activities, involvement with VIEs and accounting policies regarding consolidation of VIEs, see Part II, Item 8 - Financial Statements and Supplementary Data (Note 7) in the 2019 Annual Report on Form 10-K. On-balance sheet variable interest entities The assets of consolidated VIEs, presented based upon the legal transfer of the underlying assets in order to reflect legal ownership, that can be used only to settle obligations of the consolidated VIE and the liabilities of these entities for which creditors (or beneficial interest holders) do not have recourse to the Company’s general credit were as follows: September 30, 2020 December 31, 2019 Assets Restricted cash $ 1,763,252 $ 1,629,870 Finance receivables held for investment, net 22,711,254 26,532,328 Leased vehicles, net 16,195,376 16,461,982 Various other assets 870,229 625,359 Total assets $ 41,540,111 $ 45,249,539 Liabilities Notes payable $ 31,265,215 $ 34,249,851 Various other liabilities 117,997 188,093 Total liabilities $ 31,383,212 $ 34,437,944 Certain amounts shown above are greater than the amounts shown in the corresponding line items in the accompanying condensed consolidated balance sheets due to intercompany eliminations between the VIEs and other entities consolidated by the Company. For example, for most of its securitizations, the Company retains one or more of the lowest tranches of bonds. Rather than showing investment in bonds as an asset and the associated debt as a liability, these amounts are eliminated in consolidation as required by GAAP. The Company retains servicing rights for receivables transferred to the Trusts and receives a monthly servicing fee on the outstanding principal balance. Supplemental fees, such as late charges, for servicing the receivables are reflected in fees, commissions and other income. As of September 30, 2020 and December 31, 2019, the Company was servicing $27,688,633 and $27,253,573, respectively, of gross retail installment contracts that have been transferred to consolidated Trusts. The remainder of the Company’s retail installment contracts remain unpledged. A summary of the cash flows received from consolidated securitization trusts during the three and nine months ended September 30, 2020 and 2019, is as follows: Three Months Ended Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Assets securitized $ 5,282,901 $ 5,498,705 $ 15,845,707 $ 15,340,428 Net proceeds from new securitizations (a) $ 4,662,211 $ 4,475,722 $ 11,470,857 $ 12,232,777 Net proceeds from retained bonds 1,293 2,414 57,286 119,719 Cash received for servicing fees (b) 242,245 242,801 735,533 740,760 Net distributions from Trusts (b) 1,173,276 1,018,301 2,730,657 2,689,735 Total cash received from Trusts $ 6,079,025 $ 5,739,238 $ 14,994,333 $ 15,782,991 (a) Includes additional advances on existing securitizations. (b) These amounts are not reflected in the accompanying condensed consolidated statements of cash flows because these cash flows are intra-company and eliminated in consolidation. Off-balance sheet variable interest entities During the three and nine months ended September 30, 2020 the Compa ny sold $636,301 and $1,148,587, respectively, of gross retail installment contracts to third party investors in off-balance sheet securitizations for a loss of $13,669 and $40,553, respectively. The losses were recorded in investment losses, net, in the accompanying condensed consolidated statements of income. There were no s ales for the three and nine months ended September 30, 2019. As of September 30, 2020 and December 31, 2019, the Company was servici ng $2,554,564 and $ 2,408,205, respectively, of gross retail installment contracts that have been sold in off-balance sheet securitizations and were subject to an optional clean-up call. The portfolio was comprised as follows: September 30, 2020 December 31, 2019 Related party SPAIN serviced securitizations $ 1,418,346 $ 2,149,008 Third party SCART serviced securitizations 1,032,639 — Third party CCAP serviced securitizations 103,579 259,197 Total serviced for others portfolio $ 2,554,564 $ 2,408,205 Other than repurchases of sold assets due to standard representations and warranties, the Company ha s no exp osure to loss as a result of its involvement with these VIEs. A summary of the cash flows received from off-balance sheet securitization trusts for the three and nine months ended September 30, 2020 and 2019 is as follows: Three Months Ended Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Receivables securitized (a) $ 636,301 $ — $ 1,148,587 $ — Net proceeds from new securitizations 592,455 — 1,052,541 — Cash received for servicing fees 6,598 7,859 17,856 27,467 Total cash received from securitization trusts 599,053 7,859 1,070,397 27,467 (a) Represents the unpaid principal balance at the time of original securitization. |
Debt
Debt | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
Debt | Debt Total borrowings and other debt obligations as of September 30, 2020 and December 31, 2019 consists of: September 30, 2020 December 31, 2019 Notes Payable — Facilities with Third Parties $ 2,803,684 $ 5,399,931 Notes Payable — Secured Structured Financings 27,356,867 28,141,885 Notes Payable — Secured Structured Financing with Santander 7,222 — Notes Payable — Facilities with Santander and Related Subsidiaries 11,201,574 5,652,325 $ 41,369,347 $ 39,194,141 Notes Payable - Credit Facilities The following table presents information regarding the Company’s credit facilities as of September 30, 2020 and December 31, 2019: September 30, 2020 Maturity Date(s) Utilized Balance Committed Amount Effective Rate Assets Pledged Restricted Cash Pledged Facilities with third parties: Warehouse line August 2022 $ 166,000 $ 500,000 2.54% $ 267,776 $ — Warehouse line March 2021 500,445 1,250,000 1.27% 1,151,745 1 Warehouse line (a) October 2021 92,800 1,500,000 2.69% 819,518 — Warehouse line (b) October 2021 1,165,943 3,500,000 3.27% 1,272,926 — Warehouse line July 2021 — 500,000 1.53% 497,994 — Warehouse line October 2021 — 2,100,000 4.18% — — Warehouse line January 2022 400,000 1,000,000 1.43% 572,755 — Warehouse line November 2021 166,600 500,000 1.04% 495,011 — Warehouse line July 2022 — 900,000 3.10% — 1,684 Repurchase facility (c) January 2021 263,272 263,272 1.66% 377,550 — Repurchase facility (c) November 2020 48,624 48,624 1.79% 69,945 — Total facilities with third parties 2,803,684 12,061,896 5,525,220 1,685 Facilities with Santander and related subsidiaries: Promissory Note December 2021 250,000 250,000 3.70% — — Promissory Note December 2022 250,000 250,000 3.95% — — Promissory Note December 2023 250,000 250,000 5.25% — — Promissory Note December 2022 250,000 250,000 5.00% — — Promissory Note May 2021 250,000 250,000 2.25% — — Promissory Note March 2021 300,000 300,000 3.95% — — Promissory Note May 2023 350,000 350,000 3.80% — — Promissory Note October 2020 400,000 400,000 4.03% — — Promissory Note November 2022 400,000 400,000 3.00% — — Promissory Note April 2023 450,000 450,000 6.13% — — Promissory Note June 2022 500,000 500,000 3.30% — — Promissory Note July 2024 500,000 500,000 3.90% — — Promissory Note March 2022 650,000 650,000 4.20% — — Promissory Note August 2021 650,000 650,000 3.44% — — Promissory Note September 2023 750,000 750,000 3.38% — — Promissory Note June 2025 1,000,000 1,000,000 3.99% — — Promissory Note June 2022 2,000,000 2,000,000 1.40% — — Promissory Note September 2022 2,000,000 2,000,000 1.04% — — Line of credit July 2021 — 500,000 2.18% — — Line of credit March 2022 — 2,500,000 3.35% — — Total facilities with Santander and related subsidiaries 11,200,000 14,200,000 — — Total revolving credit facilities $ 14,003,684 $ 26,261,896 $ 5,525,220 $ 1,685 (a) During the three months ended March 31, 2020, Chrysler Finance Loan credit facility was reactivated with a $1 billion commitment. In April 2020, the commitment amount was increased by $500 million. (b) This line is held exclusively for financing of Chrysler Finance leases. In April 2020, the commitment amount was reduced by $500 million. (c) The repurchase facilities are collateralized by securitization notes payable retained by the Company. As the borrower, we are exposed to liquidity risk due to changes in the market value of the retained securities pledged. In some instances, we place or receive cash collateral with counterparties under collateral arrangements associated with our repurchase agreements. December 31, 2019 Maturity Date(s) Utilized Balance Committed Amount Effective Rate Assets Pledged Restricted Cash Pledged Facilities with third parties: Warehouse line June 2021 $ 471,284 $ 500,000 3.32% $ 675,426 $ — Warehouse line March 2021 516,045 1,250,000 3.10% 734,640 1 Warehouse line October 2021 1,098,443 5,000,000 4.43% 1,898,365 1,756 Warehouse line July 2021 500,000 500,000 3.64% 761,690 302 Warehouse line October 2021 896,077 2,100,000 3.44% 1,748,325 7 Repurchase facility January 2020 273,655 273,655 3.80% 377,550 — Repurchase facility March 2020 100,756 100,756 3.04% 151,710 — Repurchase facility March 2020 47,851 47,851 3.15% 69,945 — Warehouse line November 2020 970,600 1,000,000 2.57% 1,353,305 — Warehouse line November 2020 471,320 500,000 2.69% 505,502 186 Warehouse line June 2021 53,900 600,000 7.02% 62,601 94 Total facilities with third parties 5,399,931 11,872,262 8,339,059 2,346 Facilities with Santander and related subsidiaries: Promissory Note December 2021 250,000 250,000 3.70% — — Promissory Note December 2022 250,000 250,000 3.95% — — Promissory Note December 2023 250,000 250,000 5.25% — — Promissory Note December 2022 250,000 250,000 5.00% — — Promissory Note March 2021 300,000 300,000 3.95% — — Promissory Note October 2020 400,000 400,000 3.10% — — Promissory Note November 2022 400,000 400,000 3.00% — — Promissory Note May 2020 500,000 500,000 3.49% — — Promissory Note June 2022 500,000 500,000 3.30% — — Promissory Note July 2024 500,000 500,000 3.90% — — Promissory Note March 2022 650,000 650,000 4.20% — — Promissory Note August 2021 650,000 650,000 3.44% — — Promissory Note September 2023 750,000 750,000 3.27% — — Line of credit July 2021 — 500,000 3.86% — — Line of credit March 2022 — 3,000,000 4.96% — — Total facilities with Santander and related subsidiaries 5,650,000 9,150,000 — — Total revolving credit facilities $ 11,049,931 $ 21,022,262 $ 8,339,059 $ 2,346 Notes Payable - Facilities with Third Parties The warehouse lines and repurchase facilities are fully collateralized by a designated portion of the Company’s retail installment contracts (Note 2), leased vehicles (Note 4), securitization notes payables and residuals retained by the Company. Facilities with Santander and Related Subsidiaries Lines of Credit SHUSA provides the Compa ny with $3,000,000 of committed revolving credit that can be drawn on an unsecured basis. Promissory Notes SHUSA provides the Company wit h $7,200,000 of u nsecured promissory notes. Santander provides the Company wi th $4,000,000 o f unsecured promissory notes. Notes Payable - Secured Structured Financings The following table presents information regarding secured structured financings as of September 30, 2020 and December 31, 2019: September 30, 2020 Estimated Maturity Date(s) at Issuance Balance Initial Note Amounts Issued (d) Initial Weighted Average Interest Rate Collateral (b) Restricted Cash 2016 Securitizations April 2022 - March 2024 $ 520,566 $ 4,878,390 1.63% - 2.46% $ 710,108 $ 165,372 2017 Securitizations July 2022 - September 2024 1,252,708 8,262,940 1.35% - 2.52% 1,921,996 228,862 2018 Securitizations May 2022 - April 2026 3,297,883 12,039,840 2.41% - 3.42% 4,853,413 417,727 2019 Securitizations (e) May 2024 - February 2027 7,365,406 11,924,720 2.08% - 3.34% 8,999,694 503,999 2020 Securitizations (e) November 2024 - May 2028 6,372,892 7,291,465 0.76% - 2.73% 7,798,089 421,219 Public Securitizations (a) 18,809,455 44,397,355 24,283,300 1,737,179 2013 Private issuances July 2024 - September 2024 1,106,654 1,537,025 1.28% 2,189,789 751 2018 Private issuances June 2022 - April 2024 3,329,885 4,536,002 2.42% - 3.53% 5,028,329 8,294 2019 Private issuance September 2022 - November 2026 2,839,895 3,524,536 2.45% - 3.90% 3,743,384 10,441 2020 Private issuance April 2024 - December 2027 1,278,200 1,500,000 1.29% - 2.68% 1,533,617 4,902 Privately issued amortizing notes (c) 8,554,634 11,097,563 12,495,119 24,388 Total secured structured financings $ 27,364,089 $ 55,494,918 $ 36,778,419 $ 1,761,567 (a) Securitizations executed under Rule 144A of the Securities Act are included within this balance. (b) Secured structured financings may be collateralized by the Company’s collateral overages of other issuances. (c) All privately issued amortizing notes issued in 2014 through 2017 were paid in full. (d) Excludes securitizations which no longer have outstanding debt and excludes any incremental borrowings. (e) As of the September 30, 2020 , $7.2 million in secured structured financing is held by Santander. December 31, 2019 Estimated Maturity Date(s) at Issuance Balance Initial Note Amounts Issued Initial Weighted Average Interest Rate Collateral Restricted Cash 2015 Securitizations August 2021 - January 2023 $ 334,916 $ 3,258,300 1.67% - 2.29% $ 411,310 $ 94,382 2016 Securitizations April 2022- March 2024 1,144,421 7,462,790 1.63% - 2.80% 1,560,133 248,784 2017 Securitizations July 2022 - September 2024 2,364,177 9,296,570 1.35% - 2.52% 3,423,303 292,601 2018 Securitizations May 2022 - April 2026 5,376,231 12,039,840 2.41% - 3.42% 7,240,151 466,069 2019 Securitizations May 2024 - February 2027 9,588,028 11,924,720 2.08% - 3.34% 12,062,261 504,810 Public Securitizations 18,807,773 43,982,220 24,697,158 1,606,646 2013 Private issuances July 2024- September 2024 2,252,616 1,537,025 1.28% 2,143,065 303 2015 Private issuances July 2019 19,029 500,000 1.05% 67,007 113 2016 Private issuances September 2024 30,943 300,000 2.35% 90,352 — 2018 Private issuance June 2022-April 2024 3,742,509 4,536,002 2.42% - 3.53% 5,292,020 10,114 2019 Private issuance September 2022 - November 2026 3,289,015 3,524,536 2.45% - 3.90% 4,455,773 10,348 Privately issued amortizing notes 9,334,112 10,397,563 12,048,217 20,878 Total secured structured financings $ 28,141,885 $ 54,379,783 $ 36,745,375 $ 1,627,524 Most of the Company’s secured structured financings are in the form of public, SEC-registered securitizations. The Company also executes private securitizations under Rule 144A of the Securities Act and periodically issues private term amortizing notes, which are structured similarly to securitizations but are acquired by banks and conduits. The Company’s securitiz ations and private issuances are collateralized by vehicle retail installment contracts and loans or leases. As of September 30, 2020 and December 31, 2019, the Company had private issuances of notes backed by vehicle leases totaling $10.0 billion and $10.2 billion, respectively. Unamortized debt issuance costs are amortized as interest expense over the terms of the related notes payable using the effective interest method and are classified as a discount to the related recorded debt balance. Amortized debt issuance costs were $10,265 and $11,591 for the for the three months ended September 30, 2020 and 2019, respectively, and $28,301 and $29,361 for the nine months ended September 30, 2020 and 2019, respectively. For securitizations, the term takes into consideration the expected execution of the contractual call option, if applicable. Amortization of premium or accretion of discount on notes payable is also included in interest expense using the effective interest method over the estimated remaining life of the notes. Total interest expense on secured structured financings for the three months ended September 30, 2020 and 2019 was $150,734 and $217,544, respectively, and for the nine months ended September 30, 2020 and 2019 was $522,266 and $671,770, respectively . |
Shareholders' Equity
Shareholders' Equity | 9 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
Shareholders' Equity | Shareholders’ Equity Share Repurchases During the three months ended March 31, 2020, the Company purchased shares of its common stock through a modified Dutch Auction Tender Offer. In June 2019, the Company announced that the Board had authorized purchases by the Company of up to $1.1 billion , excluding commissions, of its outstanding common stock effective from the third quarter of 2019 through the end of the second quarter of 2020. The Company extended the share repurchase program through the end of the third quarter of 2020. On July 31, 2020, the Company announced that SHUSA’s request for certain exceptions to the Federal Reserve Board’s interim policy (the “Interim Policy”), prohibiting share repurchases and limiting dividends to all CCAR institutions to the average trailing net income, had been approved. Such approval permitted the Board to authorize to continue its share repurchase program through the end of the third quarter of 2020. On August 10, 2020, the Company announced that it had substantially exhausted the amount of shares the Company was permitted to repurchase under the previously disclosed exception to the Interim Policy and that the Company expected to repurchase an immaterial number of shares remaining under the exception approval. On September 30, 2020, the Federal Reserve Board extended the Interim Policy through the fourth quarter of 2020. As a result, SC does not currently expect to declare or pay a dividend in the fourth quarter of 2020. Please find below the details of the Company's tender offer and other share repurchase programs for the three and nine months ended September 30, 2020 and 2019 : Three Months Ended Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Tender offer (a): Number of shares purchased — — 17,514,707 — Average price per share $ — $ — $ 26.00 $ — Cost of shares purchased (b) $ — $ — $ 455,382 $ — Other share repurchases: Number of shares purchased 10,198,800 5,479,650 15,956,561 10,194,772 Average price per share $ 21.91 $ 25.71 $ 20.00 $ 24.08 Cost of shares purchased (b) $ 223,485 $ 140,909 $ 319,075 $ 245,496 Total number of shares purchased 10,198,800 5,479,650 33,471,268 10,194,772 Average price per share $ 21.91 $ 25.71 $ 23.14 $ 24.08 Total cost of shares purchased (b) $ 223,485 $ 140,909 $ 774,457 $ 245,496 (a) During the three months ended March 31, 2020, the Company purchased shares of its common stock through a modified Dutch Auction Tender Offer. (b) Cost of shares exclude commissions Refer to Part II Item 2 - " Unregistered Sales of Equity Securities and Use of Proceeds" section for additional details on share repurchases. Treasury Stock had 57,067,635 and 23,596,367 shares of treasury stock outstanding, with a co st of $1,301,864 and $525,897 as of September 30, 2020 and December 31, 2019, respectively . No sh ares were withheld to cover income taxes related to stock issued in connection with employee incentive compensation plans for the three months ended September 30, 2020. The value of the treasury stock is included within the additional paid-in-capital. Accumulated Other Comprehensive Income (Loss) A summary of changes in accumulated other comprehensive income (loss), net of tax, for the three and nine months ended September 30, 2020 and 2019 is as follows: Three Months Ended Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Beginning balance, unrealized gains (losses) $ (63,705) $ (20,567) $ (26,693) $ 33,515 Other comprehensive income (loss) before reclassifications (gross) 94 (5,018) (43,212) (38,696) Amounts (gross) reclassified out of accumulated other comprehensive income (loss) 6,729 (6,251) 13,023 (26,655) Ending balance, unrealized gains (losses) $ (56,882) $ (31,836) $ (56,882) $ (31,836) Amounts (gross) reclassified out of accumulated other comprehensive income (loss) during the three and nine months ended September 30, 2020 and 2019 consist of the following: Three Months Ended Nine Months Ended Income statement line item Reclassification September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Cash flow hedges $ 8,939 $ (8,283) $ 17,260 $ (35,224) Interest expense Available-for-sale — — — — Investment gain/loss Tax benefit (2,210) 2,032 (4,237) 8,569 Net of tax $ 6,729 $ (6,251) $ 13,023 $ (26,655) Dividends The Company paid a cash dividend of $0.22 per share in August 2020. On September 30, 2020, the FRB extended the interim policy prohibiting share repurchases and limiting dividends to all CCAR banks to the average trailing net income. Based on SHUSA’s expected average trailing four quarters of net income, SC is prohibited from paying a dividend in the fourth quarter of 2020. Although SC’s standalone income is sufficient to declare and a pay a dividend, SC is consolidated into SHUSA’s capital plan and therefore is subject to the FRB’s interim policy that utilizes SHUSA’s average trailing income to determine the cap on common stock dividends. SC does not currently expect to declare or pay a dividend in the fourth quarter of 2020. |
Derivative Financial Instrument
Derivative Financial Instruments | 9 Months Ended |
Sep. 30, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | Derivative Financial Instruments The Company uses derivative financial instruments such as interest rate swaps, interest rate caps and the corresponding options written in order to offset the interest rate caps to manage the Company’s exposure to changing interest rates. The Company uses both derivatives that qualify for hedge accounting treatment and economic hedges. The underlying notional amounts of these derivative financial instruments at September 30, 2020 and December 31, 2019, are as follows: September 30, 2020 December 31, 2019 Notional Asset Liability Notional Asset Liability Interest rate swap agreements designated as cash flow hedges $ 2,750,000 $ — $ (79,350) $ 2,650,000 $ 2,807 $ (39,128) Interest rate swap agreements not designated as hedges 250,000 — (14,393) 1,281,000 — (10,267) Interest rate cap agreements 11,117,779 5,999 — 9,379,720 62,552 — Options for interest rate cap agreements 11,117,779 — (5,999) 9,379,720 — (62,552) The aggregate fair value of the interest rate swap agreements was included on the Company’s condensed consolidated balance sheets in other assets and other liabilities, as appropriate. The interest rate cap agreements were included in other assets and the related options in other liabilities on the Company’s condensed consolidated balance sheets. See Note 10 - “ Fair Value of Financial Instruments ” in the accompanying condensed financial statements for additional disclosure of fair value and balance sheet location of the Company’s derivative financial instruments. The Company enters into legally enforceable master netting agreements that reduce risk by permitting netting of transactions, such as derivatives and collateral posting, with the same counterparty on the occurrence of certain events. A master netting agreement allows two counterparties the ability to net-settle amounts under all contracts, including any related collateral posted, through a single payment. The right to offset and certain terms regarding the collateral process, such as valuation, credit events and settlement, are contained in ISDA master agreements. The Company has elected to present derivative balances on a gross basis even if the derivative is subject to a legally enforceable master netting (ISDA) agreement. Collateral that is received or pledged for these transactions is disclosed within the “Gross Amounts Not Offset in the condensed Consolidated Balance Sheet” section of the tables below. Information on the offsetting of derivative assets and derivative liabilities due to the right of offset was as follows, as of September 30, 2020 and December 31, 2019: Gross Amounts Not Offset in the Assets Presented Collateral Net September 30, 2020 Interest rate caps - Santander and affiliates $ 815 $ — $ 815 Interest rate caps - third party 5,184 (5,184) — Total derivatives subject to a master netting arrangement or similar arrangement 5,999 (5,184) 815 Total derivatives not subject to a master netting arrangement or similar arrangement — — — Total derivative assets $ 5,999 $ (5,184) $ 815 Total financial assets $ 5,999 $ (5,184) $ 815 December 31, 2019 Interest rate swaps - third party (b) $ 2,807 $ (540) $ 2,267 Interest rate caps - Santander and affiliates 25,330 (14,930) 10,400 Interest rate caps - third party 37,222 (26,199) 11,023 Total derivatives subject to a master netting arrangement or similar arrangement 65,359 (41,669) 23,690 Total derivatives not subject to a master netting arrangement or similar arrangement — — — Total derivative assets $ 65,359 $ (41,669) $ 23,690 Total financial assets $ 65,359 $ (41,669) $ 23,690 (a) Collateral received includes cash, cash equivalents, initial margin and other financial instruments. Cash collateral received is reported in Other liabilities in the consolidated balance sheet. Financial instruments that are pledged to the Company are not reflected in the accompanying balance sheet since the Company does not control or have the ability of rehypothecation of these instruments. In certain instances, the counter party is over-collateralized since the actual amount of collateral received exceeds the associated financial asset. As a result, the actual amount of collateral received that is reported may be greater than the amount shown in the table above. (b) Includes derivative instruments originally transacted with Santander and affiliates and subsequently amended to reflect clearing with central clearing counterparties. Gross Amounts Not Offset in the condensed Consolidated Balance Sheet Liabilities Presented Collateral Net September 30, 2020 Interest rate swaps - third party (b) $ 93,743 $ (93,743) $ — Interest rate caps - Santander and affiliates 815 (815) — Interest rate caps - third party 5,184 (4,193) 991 Total derivatives subject to a master netting arrangement or similar arrangement 99,742 (98,751) 991 Total derivatives not subject to a master netting arrangement or similar arrangement — — — Total derivative liabilities $ 99,742 $ (98,751) $ 991 Total financial liabilities $ 99,742 $ (98,751) $ 991 December 31, 2019 Interest rate swaps - third party $ 49,395 $ (49,395) $ — Interest rate caps - Santander and affiliates 25,330 (25,330) — Interest rate caps - third party 37,222 (37,222) — Total derivatives subject to a master netting arrangement or similar arrangement 111,947 (111,947) — Total derivatives not subject to a master netting arrangement or similar arrangement — — — Total derivative liabilities $ 111,947 $ (111,947) $ — Total financial liabilities $ 111,947 $ (111,947) $ — (a) Collateral pledged includes cash, cash equivalents, initial margin and other financial instruments. These balances are reported in Other assets in the consolidated balance sheet. In certain instances, the Company is over-collateralized since the actual amount of collateral pledged exceeds the associated financial liability. As a result, the actual amount of collateral pledged that is reported in Other assets may be greater than the amount shown in the table above. (b) Includes derivative instruments originally transacted with Santander and affiliates and subsequently amended to reflect clearing with central clearing counterparties. The gross gains (losses) reclassified from accumulated other comprehensive income (loss) to net income, are included as components of interest expense. The impacts on the consolidated statements of income and comprehensive income for the three and nine months ended September 30, 2020 and 2019 were as follows: Three Months Ended September 30, 2020 Recognized in Earnings Gross Gains (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) Gross amount Reclassified From Accumulated Other Comprehensive Interest rate swap agreements designated as cash flow hedges $ — $ 256 $ (8,939) Derivative instruments not designated as hedges Losses (Gains) recognized in interest expenses $ 567 Three Months Ended September 30, 2019 Recognized in Earnings Gross Gains (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) Gross amount Reclassified From Accumulated Other Comprehensive Interest rate swap agreements designated as cash flow hedges $ — $ (6,485) $ 8,283 Derivative instruments not designated as hedges Losses (Gains) recognized in interest expenses $ 903 Nine Months Ended September 30, 2020 Recognized in Earnings Gross Gains (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) Gross amount Reclassified From Accumulated Other Comprehensive Interest rate swap agreements designated as cash flow hedges $ — $ (59,405) $ (17,260) Derivative instruments not designated as hedges Losses (Gains) recognized in interest expenses $ 10,774 Nine Months Ended September 30, 2019 Recognized in Earnings Gross Gains (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) Gross amount Reclassified From Accumulated Other Comprehensive Interest rate swap agreements designated as cash flow hedges $ — $ (52,292) $ 35,224 Derivative instruments not designated as hedges Losses (Gains) recognized in interest expenses $ 14,750 The Company estimates that approxima tely $31,118 of unrealized gains inc luded in accumulated other comprehensive income (loss) will be reclassified to interest expense within the next twelve months. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Fair value measurement requires that valuation techniques maximize the use of observable inputs and minimize the use of unobservable inputs and also establishes a fair value hierarchy that categorizes the inputs to valuation techniques used to measure fair value into three levels as follows: Level 1 inputs are quoted prices in active markets for identical assets or liabilities that can be accessed as of the measurement date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2 inputs are those other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. Level 3 inputs are those that are unobservable or not readily observable for the asset or liability and are used to measure fair value to the extent relevant observable inputs are not available. Financial Instruments Measured At Fair Value On A Recurring Basis The following tables present the Company’s assets and liabilities that are measured at fair value on a recurring basis at September 30, 2020 and December 31, 2019, and the level within the fair value hierarchy: Level 1 Level 2 Level 3 Balance at September 30, 2020 Level 1 Level 2 Level 3 Balance at December 31, 2019 Other assets: Trading interest rate caps (a) $ — $ 5,999 $ — $ 5,999 $ — $ 62,552 $ — $ 62,552 Cash flow hedging interest rate swaps (a) — — — $ — — 2,807 — $ 2,807 Available-for-sale-debt securities (b) — 95,666 — $ 95,666 — 92,246 — $ 92,246 Other liabilities: Trading options for interest rate caps (a) — 5,999 — $ 5,999 — 62,552 — $ 62,552 Cash flow hedging interest rate swaps (a) — 79,350 — $ 79,350 — 39,128 — $ 39,128 Trading interest rate swaps (a) — 14,393 — $ 14,393 — 10,267 — $ 10,267 Retail installment contracts (c)(d) — — 8,248 $ 8,248 — 17,634 4,719 $ 22,353 (a) The valuation is determined using widely accepted valuation techniques including a DCF on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivative, including the period to maturity, and uses observable market-based inputs. The Company incorporates credit valuation adjustments to appropriately reflect both its own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurement of its derivatives. In adjusting the fair value of its derivative contracts for the effect of nonperformance risk, the Company has considered the impact of netting and any applicable credit enhancements, such as collateral postings and guarantees. The Company utilizes the exception in ASC 820-10-35-18D (commonly referred to as the “portfolio exception”) with respect to measuring counterparty credit risk for instruments (Note 9). (b) The Company's AFS debt securities includes U.S. Treasury securities that are valued utilizing observable market quotes. The Company obtains vendor trading platform data (actual prices) from a number of live data sources, including active market makers and interdealer brokers and its securities are therefore, classified as Level 2. (c) For certain retail installment contracts reported in finance receivables held for investment, net, the Company has elected the fair value option. The fair values of the retail installment contracts are estimated using a DCF model are classified as Level 3. As of December 31, 2019, Company had used the most recent purchase price as the fair value for certain loans and hence classified those retail installment contracts as Level 2. Changes in the fair value are recorded in investment gains (losses), net in the condensed consolidated statement of income. (d) The aggregate fair value of retail installment contracts in non-accrual status, as of September 30, 2020 and December 31, 2019, i s $2,031 a nd $9,511, respectively. Level 3 Rollforward for Assets and Liabilities Measured at Fair Value on a Recurring Basis The following table presents the changes in retail installment contracts held for investment balances classified as Level 3 balances for the three and nine months ended September 30, 2020 and 2019: Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Balance — beginning of year $ 10,585 $ 8,832 $ 4,719 $ 13,509 Additions / issuances — — 2,512 2,079 Transfer from level 2 (a) — — 17,634 — Net collection activities (2,410) (3,176) (16,854) (10,242) Gains recognized in earnings 73 632 237 942 Balance — end of year $ 8,248 $ 6,288 $ 8,248 $ 6,288 (a) The Company transferred retail installment contracts from Level 2 to Level 3 during the three months ended March 31, 2020 because the fair value for these assets could not be determined by using readily observable inputs at March 31, 2020. There we re no other material transfers in or out of Level 3 during the three and nine months ended September 30, 2020 and three and nine months ended September 30, 2019. Financial Instruments Measured At Fair Value On A Nonrecurring Basis The following table presents the Company’s assets and liabilities that are measured at fair value on a nonrecurring basis at September 30, 2020 and December 31, 2019, respectively: Nine Months Ended September 30, 2020 Year Ended December 31, 2019 Total Lower of cost or fair value expense Total Lower of cost or fair value expense Other assets — vehicles (a) $ 370,678 $ — $ 341,465 $ — Personal loans held for sale (b) 763,292 241,198 1,007,105 408,700 Auto loans impaired due to bankruptcy (c) 188,226 — 200,504 9,106 ( a) The Company estimates the fair value of its vehicles, which are obtained either through repossession or lease termination, using historical auction rates and current market levels of used car prices. (b) The estimated fair value for personal loans held for sale is calculated based on the lower of market participant view and a DCF analysis in which the Company uses significant unobservable inputs on key assumptions. The lower of cost or fair value adjustment for personal loans held for sale includes customer default activity and adjustments related to the net change in the portfolio balance during the reporting period. (c) For loans that are considered collateral-dependent, such as certain bankruptcy loans, impairment is measured based on the fair value of the collateral, less its estimated cost to sell. For the underlying collateral, the estimated fair value is obtained using historical auction rates and current market levels of used car prices. No additional lower of cost or fair value expense was recorded for the nine months ended September 30, 2020. Quantitative Information about Level 3 Fair Value Measurements The following table presents quantitative information about the significant unobservable inputs for assets and liabilities measured at fair value on a recurring and nonrecurring basis at September 30, 2020 and December 31, 2019, respectively: Financial Instruments Fair Value at September 30, 2020 Valuation Technique Unobservable Inputs Range (weighted average) (a) Financial Assets: Retail installment contracts held for investment $ 8,248 Discounted Cash Flow Discount Rate 8%-14% (9%) Default Rate 4%-20% (5%) Prepayment Rate 15%-25% (15%) Loss Severity Rate 50%-60% (56%) Personal loans held for sale (b) $ 763,292 Lower of Market or Income Approach Market Approach Market Participant View 60%-70% Income Approach Discount Rate 20%-30% Default Rate 40%-50% Net Principal & Interest Payment Rate 65%-75% Loss Severity Rate 90%-95% (a) Weighted average was developed by weighting the associated relative unpaid principal balances. (b) The estimated fair value for personal loans held for sale (Bluestem) is calculated based on the lower of market participant view, a DCF analysis in which the Company uses significant unobservable inputs on key assumptions, and also considers the possible outcomes of the Bluestem bankruptcy process. Financial Instruments Fair Value at December 31, 2019 Valuation Technique Unobservable Inputs Range Financial Assets: Retail installment contracts held for investment $ 4,719 Discounted Cash Flow Discount Rate 8%-10% Default Rate 15%-20% Prepayment Rate 6%-8% Loss Severity Rate 50%-60% Personal loans held for sale $ 1,007,105 Lower of Market or Income Approach Market Approach Market Participant View 70%-80% Income Approach Discount Rate 15%-25% Default Rate 30%-40% Net Principal & Interest Payment Rate 70%-85% Loss Severity Rate 90%-95% Financial Instruments Disclosed, But Not Carried, At Fair Value The following tables present the carrying value and estimated fair value of the Company’s financial assets and liabilities disclosed, but not carried, at fair value at September 30, 2020 and December 31, 2019, and the level within the fair value hierarchy: September 30, 2020 December 31, 2019 Carrying Estimated Level 1 Level 2 Level 3 Carrying Estimated Level 1 Level 2 Level 3 Assets: Cash and cash equivalents (a) $ 105,616 $ 105,616 $ 105,616 $ — $ — $ 81,848 $ 81,848 $ 81,848 $ — $ — Finance receivables held for investment, net (b) 27,253,256 29,354,905 — — 29,354,905 27,544,162 28,133,427 — 1,009,358 27,124,069 Restricted cash (a) 2,267,154 2,267,154 2,267,154 — — 2,079,239 2,079,239 2,079,239 — — Investments in debt securities held to maturity (c) 50,381 50,942 — 50,942 — — — — — — Total $ 29,676,407 $ 31,778,617 $ 2,372,770 $ 50,942 $ 29,354,905 $ 29,705,249 $ 30,294,514 $ 2,161,087 $ 1,009,358 $ 27,124,069 Liabilities: Notes Payable: Facilities with third parties (d) $ 2,803,684 $ 2,803,684 $ — $ — $ 2,803,684 $ 5,399,931 $ 5,399,931 $ — $ — $ 5,399,931 Secured structured financings (e) 27,364,089 27,883,027 — 18,638,472 9,244,555 28,141,885 28,360,948 — 18,646,326 9,714,622 Facilities with Santander and related subsidiaries (f) 11,201,574 11,539,861 — — 11,539,861 5,652,325 5,724,675 — — 5,724,675 Total $ 41,369,347 $ 42,226,572 $ — $ 18,638,472 $ 23,588,100 $ 39,194,141 $ 39,485,554 $ — $ 18,646,326 $ 20,839,228 (a) Cash and cash equivalents and restricted cash — The carrying amount of cash and cash equivalents, including restricted cash, is at an approximated fair value as the instruments mature within 90 days or less and bear interest at market rates. (b) Finance receivables held for investment, net — Finance receivables held for investment, net are carried at amortized cost, net of an allowance. These receivables exclude retail installment contracts that are measured at fair value on a recurring and nonrecurring basis. The estimated fair value for the underlying financial instruments is determined as follows: • Retail installment contracts held for investment and purchased receivables - credit deteriorated — As of December 31, 2019 , the Company used the most recent purchase price as the fair value for certain loans and therefore, classified those retail installment contracts as Level 2. The estimated fair value of all finance receivables at September 30, 2020 is estimated using a DCF model, and such receivables are classified as Level 3. • Finance lease receivables — Finance lease receivables are carried at gross investments, net of unearned income and allowance for lease losses. Management believes that the terms of these credit agreements approximate market terms for similar credit agreements. • Receivables from dealers and personal loans held for investment — Receivables from dealers and personal loans held for investment are carried at amortized cost, net of credit loss allowance. Management believes that the terms of these credit agreements approximate market terms for similar credit agreements. (c) Investments in debt securities held to maturity - Investments in debt securities held to maturity are recorded at amortized cost and are priced by third-party pricing vendors. The third-party vendors use a variety of methods when pricing these securities that incorporate relevant observable market data to arrive at an estimate of what a buyer in the marketplace would pay for a security under current market conditions. These investment securities are, therefore, considered Level 2. (d) Notes payable — facilities with third parties — The carrying amount of notes payable related to revolving credit facilities is estimated to approximate fair value. Management believes that the terms of these credit agreements approximate market terms for similar credit agreements as the facilities are subject to short-term floating interest rates that approximate rates available to the Company. (e) Notes payable — secured structured financings — The estimated fair value of notes payable related to secured structured financings is calculated based on market observable prices and spreads for the Company’s publicly traded debt and market observed prices of similar notes issued by the Company, or recent market transactions involving similar debt with similar credit risks, which are considered Level 2 inputs. The estimated fair value of notes payable related to privately issued amortizing notes is calculated based on a combination of credit enhancement review, discounted cash flow analysis and review of market observable spreads for similar liabilities. In conducting this analysis, the Company uses significant unobservable inputs on key assumptions, which are considered Level 3 inputs. (f) Notes payable — facilities with Santander and related subsidiaries — The carrying amount of floating rate notes payable to a related party is estimated to approximate fair value as the facilities are subject to short-term floating interest rates that approximate rates available to the Company. The fair value premium/discount of the fixed rate promissory notes are derived from changes in the Company’s unsecured cost of funds since the time of issuance and weighted average life of these notes. |
Investment Losses, Net
Investment Losses, Net | 9 Months Ended |
Sep. 30, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Investment Losses, Net | Investment Losses, NetWhen the Company sells retail installment contracts, personal loans or leases to unrelated third parties or to VIEs and determines that such sale meets the applicable criteria for sale accounting, the Company recognizes a gain or loss for the difference between the cash proceeds and carrying value of the assets sold. The gain or loss is recorded in investment gains (losses), net. Lower of cost or market adjustments on the amortized cost of finance receivables held for sale are also recorded in investment gains (losses), net. Investment gains (losses), net was comprised of the following for the three and nine months ended September 30, 2020 and 2019: Three Months Ended Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Gain (loss) on sale of loans and leases $ (13,669) $ — $ (40,553) $ — Lower of cost or market adjustments (56,598) (87,454) (241,198) (239,166) Other gains, (losses and impairments), net 1,278 1,057 1,754 885 $ (68,989) $ (86,397) $ (279,997) $ (238,281) |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company recorded income tax expense of $172,476 (26.0% eff ective tax rate) and $82,156 (26.1% effective tax rate) during the three months ended September 30, 2020 and 2019, respectively. The Company recorded income tax of $137,161 (26.0% effecti ve tax rate) and $283,684 (25.1% effective tax rate) during the nine months ended September 30, 2020 and 2019, respectively. The Company is a party to a tax sharing agreement requiring that the unitary state tax liability among affiliates included in unitary state tax returns be allocated using the hypothetical separate company tax calculation method. The Company had a net receivable from affiliates under the tax sharing agreem ent of $1,003 an d $11,010 at September 30, 2020 and December 31, 2019, respectively, which was included in related party taxes receivable in the condensed consolidated balance sheet. The Company provides U.S. income taxes on earnings of foreign subsidiaries unless the subsidiaries’ earnings are considered indefinitely reinvested outside of the United States. As of September 30, 2020 and December 31, 2019, the Com pany has no earnings that are considered indefinitely reinvested. The Company applies an aggregate portfolio approach whereby disproportionate income tax effects from accumulated other comprehensive income are released only when an entire portfolio (i.e., all related units of account) of a particular type is liquidated, sold or extinguished. Significant judgment is required in evaluating and reserving for uncertain tax positions. Although management believes adequate reserves have been established for all uncertain tax positions, the final outcomes of these matters may differ. Management does not believe the outcome of any uncertain tax position, individually or combined, will have a material effect on the Company’s business, financial position or results of operations. The reserve for uncertain tax positions, as well as associated penalties and interest, is a component of the income tax provision. |
Computation of Basic and Dilute
Computation of Basic and Diluted Earnings per Common Share | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Earnings per Common Share | Computation of Basic and Diluted Earnings per Common Share Earnings per common share (“EPS”) is computed using the two-class method required for participating securities. The calculation of diluted EPS excludes the effect of exercise or settlement that would be anti-dilutive for employee stock options o f 52,114, 52,114, zero a nd 24,507 for the three and nine months ended September 30, 2020 and 2019, respectively. The following table represents EPS numbers for the three and nine months ended September 30, 2020 and 2019: Three Months Ended Nine Months Ended 2020 2019 2020 2019 Earnings per common share Net income (loss) $ 490,115 $ 232,538 $ 389,450 $ 848,308 Weighted average number of common shares outstanding before restricted participating shares (in thousands) 310,150 345,470 321,276 349,342 Weighted average number of common shares outstanding (in thousands) 310,150 345,470 321,276 349,342 Earnings per common share $ 1.58 $ 0.67 $ 1.21 $ 2.43 Earnings per common share - assuming dilution Net income (loss) $ 490,115 $ 232,538 $ 389,450 $ 848,308 Weighted average number of common shares outstanding (in thousands) 310,150 345,470 321,276 349,342 Effect of employee stock-based awards (in thousands) 157 486 216 514 Weighted average number of common shares outstanding - assuming dilution (in thousands) 310,307 345,956 321,492 349,856 Earnings per common share - assuming dilution $ 1.58 $ 0.67 $ 1.21 $ 2.42 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies The following table summarizes liabilities recorded for commitments and contingencies as of September 30, 2020 and December 31, 2019, all of which are included in accounts payable and accrued expenses in the accompanying condensed consolidated balance sheets: Agreement or Legal Matter Commitment or Contingency September 30, 2020 December 31, 2019 Chrysler Agreement Revenue-sharing and gain/(loss), net-sharing payments $ 50,809 $ 12,132 Agreement with Bank of America Servicer performance fee 1,508 2,503 Agreement with CBP Loss-sharing payments 392 1,429 Other Contingencies Consumer arrangements 25,099 1,991 Legal and regulatory proceedings Aggregate legal and regulatory liabilities 45,047 137,000 Total commitments and contingencies $ 122,855 $ 155,055 Following is a description of the agreements and legal matters pursuant to which the liabilities in the preceding table were recorded. Chrysler Agreement Under terms of the Chrysler Agreement, the Company must make revenue sharing payments to FCA and also must share with FCA when residual gains/(losses) on leased vehicles exceed a specified threshold. The Company had accrued $50,809 and $12,132 at September 30, 2020 and December 31, 2019, respectively, related to these obligations. The Chrysler Agreement also requires that the Company maintain at least $5.0 billion in funding available for Floorplan Loans and $4.5 billion of financing dedicated to FCA retail financing. In turn, FCA must provide designated minimum threshold percentages of its subvention business to the Company. Agreement with Bank of America Until January 2017, the Company had a flow agreement with Bank of America whereby the Company was committed to selling up to $300,000 of eligible loans to the bank each month. The Company retains servicing on all sold loans and may receive or pay a servicer performance payment based on an agreed-upon formula if performance on the sold loans is better or worse, respectively, than expected performance at time of sale. Servicer performance payments are due six years from the cut-off date of each loan sale. The Company had accrued $1,508 and $2,503 at September 30, 2020 and December 31, 2019, respectively, related to this obligation. Agreement with CBP Until May 2017, the Company sold loans to CBP under terms of a flow agreement and predecessor sale agreements. The Company retained servicing on the sold loans and owes CBP a loss-sharing payment capped at 0.5% of the original pool balance if losses exceed a specified threshold, established on a pool-by-pool basis. Loss-sharing payments are due the month in which net losses exceed the established threshold of each loan sale. The Company had accrued $392 and $1,429 at September 30, 2020 and December 31, 2019, respectively, related to the loss-sharing obligation. Other Contingencies The Company is or may be subject to potential liability under various other contingent exposures. The Company had accrued $25,099 and $1,991 at September 30, 2020 and December 31, 2019, respectively, for other miscellaneous contingencies. Legal and regulatory proceedings Periodically, the Company, including its subsidiaries, is and in the future expects to be party to, or otherwise involved in, various claims, disputes, lawsuits, investigations, regulatory matters and other legal matters and proceedings that arise in the ordinary course of business. In view of the inherent difficulty of predicting the outcome of any such claims, disputes, lawsuit, investigations, regulatory matter or legal proceeding, particularly where the claimants seek very large or indeterminate damages or where the matters present novel legal theories or involve a large number of parties, the Company generally cannot predict the eventual outcome of the pending matters, the timing of the ultimate resolution of the matters, or the eventual loss, fines or penalties related to the matter, if any. Accordingly, except as provided below, the company is unable to reasonably estimate a range of its potential exposure, if any, to these claims, disputes, lawsuits, investigations, regulatory matters, and other legal proceedings at this time. Further, it is reasonably possible that actual outcomes or losses may differ materially from the Company’s current assessments and estimates and any adverse resolution of any of these matters against it could materially and adversely affect the Company’s business, financial position, liquidity, and results of operation. In accordance with applicable accounting guidance, the Company establishes an accrued liability for legal and, regulatory proceedings when those matters present material loss contingencies that are both probable and estimable. In such cases, there may be an exposure to loss in excess of any amounts accrued. When a loss contingency is not both probable and estimable, the Company does not establish an accrued liability. As a legal or regulatory proceeding develops, the Company, in conjunction with any outside counsel handling the matter, evaluates on an ongoing basis whether the matter presents a material loss contingency that is probable and estimable. If a determination is made during a given quarter that a material loss contingency is probable and estimable, an accrued liability is established during such quarter with respect to such loss contingency and the Company continues to monitor the matter for further developments that could affect the amount of the accrued liability previously established. As of September 30, 2020 and December 31, 2019, the Company accrued aggregate legal and regulatory liabilities of $45 million and $137 million, respectively. Further, the Company estimates the aggregate range of reasonably possible losses for legal and regulatory proceedings, in excess of reserves established, is up to $11.5 million as of September 30, 2020. Set forth below are descriptions of the material lawsuits, regulatory matters and other legal proceedings to which the Company is subject. Securities Class Action and Shareholder Derivative Lawsuits • Deka Lawsuit: The Company is a defendant in a purported securities class action lawsuit (the "Deka Lawsuit") in the United States District Court, Northern District of Texas, captioned Deka Investment GmbH et al. v. Santander Consumer USA Holdings Inc. et al ., No. 3:15-cv-2129-K. The Deka Lawsuit, which was filed in August 26, 2014, was brought against the Company, certain of its current and former directors and executive officers and certain institutions that served as underwriters in the Company’s IPO on behalf of a class consisting of those who purchased or otherwise acquired our securities between January 23, 2014 and June 12, 2014. The complaint alleges, among other things, that our IPO registration statement and prospectus and certain subsequent public disclosures violated federal securities laws by containing misleading statements concerning the Company’s ability to pay dividends and the adequacy of the Company’s compliance systems and oversight. In December 2015, the Company and the individual defendants moved to dismiss the lawsuit, which was denied. In December 2016, the plaintiffs moved to certify the proposed classes. In July 2017, the court entered an order staying the Deka Lawsuit pending the resolution of the appeal of a class certification order in In re Cobalt Int’l Energy, Inc. Sec. Litig., No. H-14-3428, 2017 U.S. Dist. LEXIS 91938 (S.D. Tex. June 15, 2017). In October 2018, the court vacated the order staying the Deka Lawsuit and ordered that merits discovery in the Deka Lawsuit be stayed until the court ruled on the issue of class certification. On July 28, 2020, the Company executed a Stipulation of Settlement with the plaintiffs in the Deka Lawsuit that fully resolves all of the plaintiffs’ claims for a cash payment of $47 million. On August 13, 2020, the Court entered an Order Preliminarily Approving the Settlement and Providing For Notice, setting the Final Settlement Hearing for January 12, 2021. • In Re Santander Consumer USA Holdings, Inc. Derivative Litigation: In October 2015, a shareholder derivative complaint was filed in the Court of Chancery of the State of Delaware, captioned Feldman v. Jason A. Kulas, et al ., C.A. No. 11614-VCG (the "Feldman Lawsuit"). The Feldman Lawsuit names as defendants certain current and former members of the Board, and names the Company as a nominal defendant. The complaint alleges, among other things, that the current and former director defendants breached their fiduciary duties in connection with overseeing the Company’s nonprime vehicle lending practices, resulting in harm to the Company. The complaint seeks unspecified damages and equitable relief. In December 2015, the Feldman Lawsuit was stayed pending the resolution of the Deka Lawsuit. In September 2016, a shareholder derivative complaint was filed in the Court of Chancery of the State of Delaware, captioned Jackie888, Inc. v. Jason Kulas, et al ., C.A. No. 12775-VCG (the "Jackie888 Lawsuit"). The Jackie888 Lawsuit names as defendants current and former members of the Board, and names the Company as a nominal defendant. The complaint alleges, among other things, that the director defendants breached their fiduciary duties in connection with the Company’s accounting practices and controls. The complaint seeks unspecified damages and equitable relief. In April 2017, the Jackie888 Lawsuit was stayed pending the resolution of the Deka Lawsuit. In March 2018, the Feldman Lawsuit and Jackie888 Lawsuit were consolidated under the caption In Re Santander Consumer USA Holdings, Inc. Derivative Litigation , Consol. C.A. No. 11614-VCG. In January 2020, the Company executed a Stipulation and Agreement of Settlement, Compromise and Release with the plaintiffs in the consolidated action that, subject to Court approval, fully resolves all of the plaintiffs’ claims in the Feldman Lawsuit and the Jackie888 Lawsuit. The Stipulation provides for the settlement of the consolidated action and, in return, the Company has enacted or will enact and implement certain corporate governance reforms and enhancements. The Settlement Hearing at which the Court would consider the settlement was scheduled for May 27, 2020, but a shareholder filed its notice of intent to object to the settlement and the parties agreed to postpone the Settlement Hearing to a later date. Consumer Lending Cases The Company is also party to various lawsuits pending in federal and state courts alleging violations of state and federal consumer lending laws, including, without limitation, the Equal Credit Opportunity Act, the Fair Debt Collection Practices Act, Fair Credit Reporting Act, Section 5 of the Federal Trade Commission Act, the Telephone Consumer Protection Act, the Truth in Lending Act, wrongful repossession laws, usury laws and laws related to unfair and deceptive acts or practices. In general, these cases seek damages and equitable and/or other relief. Regulatory Investigations and Proceedings The Company is party to, or is periodically otherwise involved in, reviews, investigations, examinations and proceedings (both formal and informal), and information-gathering requests, by government and self-regulatory agencies, including the FRBB, the CFPB, the DOJ, the SEC, the FTC and various state regulatory and enforcement agencies. Currently, such matters include, but are not limited to, the following: • The Company received a civil subpoena from the DOJ in 2014, under FIRREA, requesting the production of documents and communications that, among other things, relate to the underwriting and securitization of nonprime vehicle loans. The Company has responded to these requests within the deadlines specified in the subpoena and has otherwise cooperated with the DOJ with respect to this matter. • In October 2014, May 2015, July 2015 and February 2017, the Company received subpoenas and/or Civil Investigative Demands (CIDs) from the Attorneys General of California, Illinois, Oregon, New Jersey, Maryland and Washington under the authority of each state’s consumer protection statutes. On May 19, 2020, all of the Consortium members and the Company announced a settlement of the investigation requiring the Company to: (1) pay a total of $65 million to the states for consumer remediation; (2) pay $5 million to the states for investigation costs; (3) pay up to $2 million in settlement administration costs; (4) provide $45 million in prospective debt forgiveness; (5) provide deficiency waivers for a defined class of SC customers; and (6) implement certain enhancements to its loan underwriting process. • In August 2017, the Company received a CID from the CFPB. The stated purpose of the CID is to determine whether the Company has complied with the Fair Credit Reporting Act and related regulations. The Company has responded to these requests within the deadlines specified in the CIDs and has otherwise cooperated with the CFPB with respect to this matter. In February 2020, the Company received a communication from the CFPB inviting the Company to respond to the CFPB’s identified issues in the form of a Notice of Opportunity to Respond and Advise (“NORA”) during which the CFPB identified potential claims it might bring against the Company. • 2017 Written Agreement with the Federal Reserve: In March 2017, the Company and SHUSA entered into a written agreement with the FRBB. Under the terms of the agreement, the Company is required to enhance its compliance risk management program, Board oversight of risk management and senior management oversight of risk management, and SHUSA is required to enhance its oversight of the Company’s management and operations. • Mississippi Attorney General Lawsuit: In January 2017, the Attorney General of Mississippi filed a lawsuit against the Company in the Chancery Court of the First Judicial District of Hinds County, Mississippi, captioned State of Mississippi ex rel. Jim Hood, Attorney General of the State of Mississippi v. Santander Consumer USA Inc., C.A. # G-2017-28. The complaint alleges that the Company engaged in unfair and deceptive business practices to induce Mississippi consumers to apply for loans that they could not afford. The complaint asserts claims under the Mississippi Consumer Protection Act (the MCPA) and seeks unspecified civil penalties, equitable relief and other relief. In March 2017, the Company filed motions to dismiss the lawsuit and the parties are proceeding with discovery. Agreements • Bluestem The Company is party to agreements with Bluestem whereby the Company is committed to purchase certain new advances on personal revolving financings receivables, along with existing balances on accounts with new advances, originated by Bluestem for an initial term ending in April 2020 and renewable through April 2022 at Bluestem’s option. As of September 30, 2020 and December 31, 2019, the total unused credit available to customers was $2.8 billion and $3.0 billion, respectively. In 2020, the Company purchased $0.8 billion of receivables, out of the $3 billion unused credit available to customers as of December 31, 2019. In 2019, the Company purchased $1.2 billion of receivables, out of the $3.1 billion unused credit available to customers as of December 31, 2018. In addition, the Company purchased $151,163 and $137,821 of receivables related to newly opened customer accounts during the nine months ended September 30, 2020 and 2019 respectively. Each customer account generated under the agreements, generally, is approved with a credit limit higher than the amount of the initial purchase with each subsequent purchase automatically approved as long as it does not cause the account to exceed its limit and the customer is in good standing. As of September 30, 2020 and December 31, 2019, the Company was obligated to purchase $13,281 and $10,628, respectively, in receivables that had been originated by Bluestem but not yet purchased by the Company. The Company also is required to make a profit-sharing payment to Bluestem each month if performance exceeds a specified return threshold. The agreement, among other provisions, gives Bluestem the right to repurchase up to 9.99% of the existing portfolio at any time during the term of the agreement, and, provides that if the repurchase right is exercised, Bluestem has the right to retain up to 20% of new accounts subsequently originated. On March 9, 2020, Bluestem and certain of its subsidiaries and affiliates filed Chapter 11 bankruptcy in the United States District Court for the District of Delaware. On August 28, 2020, BLST Operating Company LLC, purchased the Bluestem assets from bankruptcy and assumed Bluestem’s obligations under the parties’ agreements. • Others Under terms of an application transfer agreement with Nissan, the Company has the first opportunity to review for its own portfolio any credit applications turned down by the Nissan’s captive finance company. The agreement does not require the Company to originate any loans, but for each loan originated the Company will pay Nissan a referral fee . In connection with the sale of retail installment contracts through securitizations and other sales, the Company has made standard representations and warranties customary to the consumer finance industry. Violations of these representations and warranties may require the Company to repurchase loans previously sold to on- or off-balance sheet Trusts or other third parties. As of September 30, 2020, there were no loans that were the subject of a demand to repurchase or replace for breach of representations and warranties for the Company’s asset-backed securities or other sales. In the opinion of management, the potential exposure of other recourse obligations related to the Company’s retail installment contract sales agreements is not expected to have a material adverse effect on the Company’s business, financial position, results of operations, or cash flows. Santander has provided guarantees on the covenants, agreements, and obligations of the Company under the governing documents of its warehouse lines and privately issued amortizing notes. These guarantees are limited to the obligations of the Company as servicer. In November 2015, the Company executed a forward flow asset sale agreement with a third party under terms of which the Company committed to sell $350,000 in charged off loan receivables in bankruptcy status on a quarterly basis. However, any sale more than $275,000 is subject to a market price check. The remaining aggregate commitment as of September 30, 2020 and December 31, 2019, not subject to market price check was $27,702 and $39,787, respectively. These matters are ongoing and could in the future result in the imposition of damages, fines or other penalties. No assurance can be given that the ultimate outcome of these matters or any resulting proceedings would not materially and adversely affect the Company’s business, financial condition and results of operations. |
Related-Party Transactions
Related-Party Transactions | 9 Months Ended |
Sep. 30, 2020 | |
Related Party Transactions [Abstract] | |
Related-Party Transactions | Related-Party Transactions Related-party transactions not otherwise disclosed in these footnotes to the condensed consolidated financial statements include the following: Credit Facilities Interest expense, including unused fees, for lines of credit from SHUSA (Note 7) totaled $79,854 and $54,963 for the three months ended September 30, 2020 and 2019, respectively, and $213,224 and $145,840 for the nine months ended September 30, 2020 and 2019, respectively. Accrued interest for lines of credit from SHUSA at September 30, 2020 and December 31, 2019 was $42,718 and $29,326, respectively. Interest expense, including unused fees, for lines of credit from Santander (Note 7) totaled $7,997 and zero for the three months ended September 30, 2020 and 2019 respectively, and $8,700 and zero for the nine months ended September 30, 2020 and 2019 respectively. Accrued interest for lines of credit from Santander at September 30, 2020 and December 31, 2019 was $1,512 and zero, respectively. In 2015, under an agreement with Santander, the Company agreed to begin incurring a fee of 12.5 basis points (per annum) on certain warehouse lines, as they renew, for which Santander provides a guarantee of the Company’s servicing obligations. The Company recognized guarantee fee expense of zero for the three months ended September 30, 2020 and 2019, and zero and $384 for the nine months ended September 30, 2020 and 2019, respectively. As of September 30, 2020 and December 31, 2019, the Company had zero of related fees payable to Santander. Derivatives The Company has derivative financial instruments with Santander and affiliates with outstanding notional amounts of $3,264,580 and $1,874,100 as of September 30, 2020 and December 31, 2019, respectively (Note 9). The Company had a collateral overage on derivative liabilities with Santander and affiliates of $554 and $2,220 as of September 30, 2020 and December 31, 2019, respectively. Retail Installment Contracts and RV Marine The Company also has agreements with SBNA to service auto retail installment contracts and recreational and marine vehicle portfolios. Servicing fee income recognized under these agreements totaled $472 and $377 for the three months ended September 30, 2020 and 2019, respectively, and $1,566 and $1,154 for the nine months ended September 30, 2020 and 2019, respectively. Other information on the serviced auto loan and retail installment contract portfolios for SBNA as of September 30, 2020 and December 31, 2019 is as follows: September 30, 2020 December 31, 2019 Total serviced portfolio $ 209,453 $ 277,669 Cash collections due to owner 17,793 14,908 Servicing fees receivable 1,938 738 Dealer Lending Under the Company’s agreement with SBNA, the Company is required to permit SBNA a first right to review and assess CCAP dealer lending opportunities, and SBNA is required to pay the Company an origination fee for each loan originated under the agreement. The agreement also transferred the servicing of all CCAP receivables from dealers, including receivables held by SBNA to the Company and from the Company to SBNA. The Company may provide advance funding for dealer loans originated by SBNA, which is reimbursed to the Company by SBNA. The Company had no outstanding receivable from SBNA as of September 30, 2020 or December 31, 2019 for such advances. Other information related to the above transactions with SBNA is as follows: Three Months Ended Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Origination and renewal fee income from SBNA $ 451 $ 1,291 $ 2,473 $ 4,218 Servicing fees expenses charged by SBNA (9) 52 63 113 Under the agreement with SBNA, the Company may originate retail consumer loans in connection with sales of vehicles that are collateral held against floorplan loans by SBNA. Upon origination, the Company remits payment to SBNA, which settles the transaction with the dealer. The Company owed SBNA $9,754 and $5,384 related to such originations as of September 30, 2020 and December 31, 2019, respectively. The Company received a $9,000 referral fee in connection with a sourcing and servicing arrangement and is amortizing the fee into income over the ten Origination Support Services Beginning in 2018, the Company agreed to provide SBNA with origination support services in connection with the processing, underwriting and purchase of retail loans, primarily from FCA dealers. In addition, the Company agreed to perform the servicing for any loans originated on SBNA’s behalf. For the three and nine months ended September 30, 2020, the Company facilitated the purchase of $1.1 billion and $3.9 billion of retail installment contacts, respectively. For the three and nine months ended September 30, 2019, the Company facilitated the purchase of $2.1 billion and $5.0 billion of retail installment contacts, respectively. The Company recognized origination fee and servicing fee income of $7,902 and $29,457 for the three and nine months ended September 30, 2020, respectively, of which $4,089 is receivable as of September 30, 2020. The Company recognized origination fee and servicing fee income of $19,892 and $45,716 for the three and nine months ended September 30, 2019, respectively, of which $8,114 is receivable as of September 30, 2019. Securitizations The Company had a Master Securities Purchase Agreement (MSPA) with Santander, whereby the Company had the option to sell a contractually determined amount of eligible prime loans to Santander, through the SPAIN securitization platform, for a term that ended in December 2018. The Company provides servicing on all loans originated under this arrangement. Other information relating to SPAIN securitization platform for the three and nine months ended September 30, 2020 and 2019 is as follows: Three Months Ended Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Servicing fee income $ 4,488 $ 4,743 $ 15,680 $ 20,885 Servicing fee receivable, as of September 30, 2020 and December 31, 2019, was $1,247 and $1,869, respectively. The Company had $6,879 and $8,180 of collections due to Santander, as of September 30, 2020 and December 31, 2019, respectively. Santander Investment Securities Inc. (SIS), an affiliated entity, serves as joint book runner and co-manager on certain of the Company’s securitizations. Amounts paid to SIS for the three months ended September 30, 2020 and 2019, totaled $103 and $929, respectively, and totaled $1,625 and $1,894 for the nine months ended September 30, 2020 and 2019, respectively, and are included in debt issuance costs in the accompanying condensed consolidated financial statements. Other employee compensation Sandra Broderick is Head of Operations and Executive Vice President of the Company, and Head of Operations and Senior Executive Vice President of SHUSA. During the nine months ended September 30, 2020, SHUSA owed the Company $163 for the share of compensation expense based on time allocation between her services to the Company and SHUSA. In addition, certain employees of the Company and SHUSA, provide services to each other. For the nine months ended September 30, 2020, the Company owed SHUSA approximately $9,221 and SHUSA owed the Company approximately $4,198 for such service. Other related-party transactions • The Company subleases approximately 13,000 square feet of its corporate office space to SBNA. For the three months ended September 30, 2020 and 2019, the Company recorded $44 in sublease revenue on this property. For the nine months ended September 30, 2020 and 2019, the company recorded $132, in sublease revenue on this property. • The Company has certain deposit and checking accounts with SBNA, an affiliated entity. As of September 30, 2020 and December 31, 2019, the Company had a balance of $26,920 and $33,683, respectively, in these accounts. • The Company and SBNA have a Credit Card Agreement (Card Agreement) whereby SBNA provides credit card services for travel and related business expenses for vendor payments. This service is at zero cost but generates rebates based on purchases made. As of September 30, 2020, the activities associated with the program were insignificant. • The Company pays SBNA a market rate-based fee expense for payments made at SBNA retail branch locations for accounts originated or serviced by the Company and the costs associated with modifying the Advanced Teller platform to the payments. The Company incurred expenses of $39 and $49 for these services for the three months ended September 30, 2020 and 2019, respectively, and $140 and $182 for the nine months ended September 30, 2020 and 2019, respectively. • The Company has contracted Aquanima, a Santander affiliate, to provide procurement services. Expenses incurred totaled $785 and $765 for the three months ended September 30, 2020 and 2019, respectively, and $2,079 and $1,780 for the nine months ended September 30, 2020 and 2019, respectively. • Santander Global Tech (formerly known as Produban Servicios Informaticos Generales S.L.), a Santander affiliate, provides professional services, telecommunications, and internal and/or external applications to the Company. Expenses incurred, which are included as a component of other operating costs in the accompanying condensed consolidated statements of income, totaled $279 and $71 for the three months ended September 30, 2020 and 2019, respectively, and $350 and $300 for the nine months ended September 30, 2020 and 2019, respectively. |
Employee Benefit Plans
Employee Benefit Plans | 9 Months Ended |
Sep. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans The Company has granted stock options to certain executives, other employees, and independent directors under the Company’s 2011 Management Equity Plan (the MEP), which enabled the Company to grant stock option awards up to a total of approximately 29 million common shares (net of shares canceled and forfeited). The MEP expired in January 2015, and the Company will not grant any further awards under the MEP. The Company has granted stock options, restricted stock awards and restricted stock units (RSUs) under the Omnibus Incentive Plan (the Plan), which was established in 2013 and enables the Company to grant awards of cash and of non-qualified and incentive stock options, stock appreciation rights, restricted stock awards, RSUs, and other awards that may be settled in or based upon the value of the Company’s common stock up to a total of 5,192,641 shares of common stock. The Plan was amended and restated as of June 16, 2016. Stock options granted under the MEP and the Plan have an exercise price based on the estimated fair market value of the Company’s common stock on the grant date. The stock options expire ten years after grant date and include both time vesting options and performance vesting options. The fair value of the stock options is amortized into expense over the vesting period as time and performance vesting conditions are met. In connection with compensation restrictions imposed on certain executive officers and other employees by the European Central Bank under the Capital Requirements Directive IV prudential rules, which require a portion of such officers’ and employees’ variable compensation to be paid in the form of equity, the Company periodically grants RSUs. Under the Plan, a portion of these RSUs vest immediately upon grant, and a portion vest annually over the following three Compensation expense related to the 583,890 shares of restricted stock that the Company has issued to certain executives is recognized over a five-year vesting period, with zero recorded for the three and nine months ended September 30, 2020 and 2019. The Company recognized $6,161 and $7,973 related to stock options and restricted stock units within compensation expense for the nine months ended September 30, 2020 and 2019 , respectively. In addition, the Company recognizes forfeitures of awards as they occur. A summary of the Company’s stock options and related activity as of and for the nine months ended September 30, 2020 is as follows: Shares Weighted Weighted Aggregate Options outstanding at January 1, 2020 273,737 $ 13.09 3.1 $ 2,867 Granted — — — — Exercised (67,241) 9.97 — 868 Expired (15,440) 25.89 — — Forfeited (13,460) 17.25 — — Other (a) — — — — Options outstanding at September 30, 2020 177,596 12.84 2.2 1,126 Options exercisable at September 30, 2020 177,596 $ 12.84 2.2 $ 1,126 Options expected to vest at September 30, 2020 — $ — — $ — (a) Represents stock options that were reinstated. A summary of the Company’s Restricted Stock Units and performance stock units and related activity as of and for the nine months ended September 30, 2020 is as follows: Shares Weighted Weighted Aggregate Outstanding as of January 1, 2020 498,299 $ 17.41 0.9 $ 11,645 Granted 268,438 24.02 — — Vested (365,740) 19.64 — 8,557 Forfeited/canceled (12,953) 17.97 — — Non-vested at September 30, 2020 388,044 $ 19.98 1.0 $ 7,059 |
Description of Business, Basi_2
Description of Business, Basis of Presentation, and Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying condensed consolidated financial statements include the accounts of the Company and its consolidated subsidiaries, including certain Trust that are considered VIEs. The Company also consolidates other VIEs for which it is deemed to be the primary beneficiary. All significant intercompany balances and transactions have been eliminated in consolidation. The accompanying condensed consolidated financial statements as of September 30, 2020 and December 31, 2019, and for the three and nine months ended September 30, 2020 and 2019, have been prepared in accordance with GAAP for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, these financial statements contain all adjustments, consisting of normal and recurring adjustments, necessary for the fair statement of the financial position, results of operations and cash flows for the periods indicated and contain adequate disclosure for the fair statement of this interim financial information. Results of operations for the periods presented herein are not necessarily indicative of results of operations for the entire year. These financial statements should be read in conjunction with the Annual Report on Form 10-K for the year ended December 31, 2019. |
Use of Estimates | Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts in the financial statements and accompanying notes. Actual results could differ from those estimates and those differences may be material. The most significant estimates include the determination of credit loss allowance, accretion of discounts and subvention, impairment, fair value |
Business Segment Information | Business Segment Information The Company has one reportable segment, Consumer Finance, which includes the Company’s vehicle financial products and services, including retail installment contracts, vehicle leases, and Dealer Loans, as well as financial products and services related to recreational vehicles and marine vehicles. It also includes the Company’s personal loan and point-of-sale financing operations. |
Recently Adopted Accounting Standards | Recently Adopted Accounting Standards Since January 1, 2020, the Company adopted the following FASB ASUs: • Financial Instruments - Credit Losses (Topic 326) • In March 2020, the FASB issued ASU 2020-4, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. This guidance provides temporary optional expedients to reduce the costs and complexity associated with the high volume of contractual modifications expected in the transition away from LIBOR as the benchmark rate in contracts and hedges. These optional expedients allow entities to negate many of the accounting impacts of modifying contracts and hedging relationships necessitated by reference rate reform, allowing them to generally maintain the accounting as if a change had not occurred. The Company adopted this standard during the three months ended March 31, 2020, and will elect the practical expedients relative to the Company’s contracts and hedging relationships modified as a result of reference rate reform through December 31, 2022. These practical expedients did not have a material impact on the Company’s business, financial position, results of operations, or disclosures. • In December 2019, the FASB issued ASU 2019-12, Simplifying the Accounting for Income Taxes. The amendments in this ASU simplify the accounting for income taxes by removing certain exceptions to the general tax accounting principles and simplifying other specific tax scenarios. The Company early adopted this update as of January 1, 2020, and it did not have any material impact to the Company’s business, financial position, results of operations, or disclosures. The adoption of the following ASUs did not have a material impact on the Company’s business, financial position or results of operations. • ASU 2018-17, Consolidation (Topic 10): Targeted Improvements to Related Party Guidance for Variable Interest Entities • ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework- Changes to the Disclosure Requirements for Fair Value Measurement |
Investment securities | Investment securities Debt securities expected to be held for an indefinite period of time are classified as AFS and recorded on the balance sheet at fair value. If the fair value of an AFS debt security declines below its amortized cost basis and the Company does not have the intention or requirement to sell the security before it recovers its amortized cost basis, declines due to credit factors will be recorded in earnings through the ACL for debt securities, and declines due to non-credit factors will be recorded in AOCI, net of taxes. Subsequent to recognition of a credit loss, improvements to the expectation of collectability will be reversed through the ACL for debt securities. If the Company has the intention or requirement to sell the security, the Company will record its fair value changes in earnings as a direct write down to the security. Increases in fair value above amortized cost basis are recorded in AOCI, net of taxes. The Company conducts an impairment assessment quarterly on all AFS securities with a fair value that is less than their amortized cost basis to determine whether the loss is due to credit factors. Securities for which management expects risk of nonpayment of the amortized cost basis is zero, do not have a reserve. The Company has a zero loss expectation when the securities are issued or guaranteed by certain US government entities, because these entities have a long history of no defaults and the highest credit ratings issued by rating agencies. In the event of a credit loss, the credit component of the impairment is recognized within non-interest income as a separate line item, and by the recording of a valuation reserve. The non-credit component is recorded within AOCI. |
Purchased Credit Deteriorated or PCD Loans | Purchased Credit Deteriorated or PCD loansLoans that the Company deems at acquisition to have more than insignificant deterioration in credit quality since origination (i.e., Purchased Credit Deteriorated or PCD loans) require the recognition of an allowance for credit losses at purchase. The allowance for credit losses is added to the purchase price at the date of acquisition to determine the initial amortized cost basis of the PCD loan. The allowance for credit losses is calculated using the same methodology as originated loans, as described below. Alternatively, the Company can elect the fair value option at the time of purchase for any financial asset. Under the FVO, loans are recorded at fair value with changes in value recognized immediately in income. There is no ACL for loans under an FVO. |
Credit Loss Expense and Allowance for Credit losses | Credit Loss Expense and Allowance for Credit losses General Credit loss expenses are charged to operations in amounts sufficient to maintain the ACL at levels considered adequate to cover expected credit losses in the Company’s retail installment contracts. The allowance for expected credit losses on retail installment contracts is measured based on a lifetime expected loss model, which means that it is not necessary for a loss event to occur before a credit loss is recognized. Management’s estimate of expected credit losses is based on an evaluation of relevant information about past events, current conditions, and reasonable and supportable forecasts that affect the future collectability of the reported amounts. Management's evaluation takes into consideration the risks in the portfolio, past loss experience, specific loans with loss potential, geographic and industry concentrations, delinquency trends, economic forecasts and other relevant factors. While management uses the best information available to make such evaluations, future adjustments to the ACL may be necessary if conditions differ substantially from the assumptions used in making the evaluations. The Company measures expected losses of all components on an amortized cost basis. For all loans except TDRs, the Company has elected to exclude accrued interest receivable balances from the measurement of expected credit losses because it applies a nonaccrual policy that results in the timely write off of uncollectible accrued interest. For loans on nonaccrual status, interest income is recognized on a cash basis, and the accrual of interest is resumed and reinstated if a delinquent account subsequently becomes 60 days or less past due. Methodology The Company uses several methodologies for the measurement of ACL. The ACL is made up of a quantitative and a qualitative component. To determine the quantitative component, the Company generally uses a DCF approach for determining ACL for TDRs and other individually assessed loans, and a non-DCF approach for other loans. Expected credit losses are estimated on an individual basis only if the individual asset or exposure does not share similar risk attributes with other financial assets or exposures, including when an asset is treated as a collateral dependent asset. The ACL estimate includes significant assumptions including the reasonable and supportable economic forecast period, which considers the availability of forward-looking scenarios and their respective time horizons, as well as the reversion method to historical losses. This method results in a single, quantitatively consistent credit model across the entire projection period as the macroeconomic effects in the historical data are controlled for the estimate of the long-run loss level. Models The Company uses a statistical methodology based on an ECL approach that focuses on forecasting the ECL components (i.e., probability of default, payoff, loss given default and exposure at default) on a loan level basis to estimate the expected future life time losses. The individual loan balances used in the models are measured on an amortized cost basis. • In calculating the probability of default and payoff, the Company developed model forecasts, which consider variables such as delinquency status, loan tenor and other credit quality indicators. • The loss given default component forecasts the extent of losses given that a default has occurred and considers variables such as collateral, loan-to-value and other credit quality indicators. • The exposure at default component captures the effects of expected partial prepayments and underpayments that are expected to occur during the forecast period and considers variable such as loan-to-value, collateral and other credit quality indicators. The above ECL components are used to compute an ACL based on the weighted average of the results of the macroeconomic scenarios. The weighting of these scenarios is governed and approved quarterly by management through established committee governance. These ECL components are inputs to both the Company’s DCF approach for TDR and individually assessed loans and non-DCF approach for other loans. When using a non-DCF method to measure the ACL, the Company measures ECL over the asset’s contractual term, adjusted for (a) expected prepayments; (b) expected extensions associated with assets for which management has a reasonable expectation at the reporting date that it will execute a TDR with the borrower; and (c) expected extensions or renewal options (excluding those that are accounted for as derivatives) included in the original or modified contract at the reporting date that are not unconditionally cancellable by the entity. DCF approaches A DCF method measures expected credit losses by forecasting expected future principal and interest cash flows and discounting them using the financial asset’s EIR. The ACL reflects the difference between the amortized cost basis (including accrued interest) and the present value of the expected cash flows. When using a DCF method to measure the ACL, the period of exposure is determined as a function of the Company’s expectations of the timing of principal and interest payments. The Company considers estimated prepayments in the future principal and interest cash flows when utilizing a DCF Method. The Company generally uses a DCF approach for TDRs. Collateral - Dependent Assets A loan is considered a Collateral Dependent Financial Asset when (a) the Company determines foreclosure is probable or (b) the borrower is experiencing financial difficulty and the Company expects repayment to be provided substantially through the operation or sale of the collateral. For all collateral dependent loans such as certain bankruptcy modifications, the Company measures the ACL as the difference between the loan’s amortized cost basis and the fair value of the underlying collateral as of the reporting date, adjusted for expected costs to sell. If repayment or satisfaction of the loan is dependent only on the operation, rather than the sale, of the collateral, the measure of credit losses does not incorporate estimated costs to sell. The collateral dependent loan is written down (i.e. charged off) to the fair value of the collateral adjusted for costs to sell (if repayment from sale is expected.) Any subsequent increase or decrease in the collateral’s fair value less cost to sell is recognized as an adjustment to the related loan’s ACL. Negative allowance Negative allowance is defined as the amount of future recovery expected for accounts that have already been charged-off. The Company performs an analysis of the actual historical recovery values to determine the pattern of recovery and expected rate of recovery over a given historic period, and uses the results of this analysis to determine negative allowance. Negative allowance reduces the ACL. Qualitative Reserve Regardless of the extent of the Company's analysis of customer performance, portfolio evaluations, trends or risk management processes established, a level of imprecision will always exist due to the judgmental nature of loan portfolio and/or individual loan evaluations. The Company maintains a qualitative reserve as a component of the ACL to recognize the existence of these exposures. Imprecisions include loss factors inherent in the loan portfolio that may not have been discreetly contemplated in deriving the quantitative component of the allowance, as well as potential variability in estimates. The qualitative adjustment is also established in consideration of several factors such as the interpretation of economic trends, changes in the nature and volume of our loan portfolio, trends in delinquency and collateral values, and concentration risks. This analysis is conducted at least quarterly, and the Company revises the qualitative component of the allowance when necessary in order to address improving or deteriorating credit quality trends or specific risks associated with loan pool classification, not otherwise captured in the quantitative models. Governance A comprehensive analysis of the ACL is performed by the Company on a quarterly basis. Management regularly monitors the condition of borrowers and assesses both internal and external factors in determining whether any relationships have deteriorated considering factors such as historical loss experience, trends in delinquency, changes in risk composition and underwriting standards, experience and ability of staff and regional and national economic conditions, trends and forecasts. Risk factors are continuously reviewed and revised by management when conditions warrant. The Company's reserves are principally based on various models subject to the Company's model risk management framework. New models are approved by the SHUSA's Model Risk Management Committee. Models, inputs and documentation are further reviewed and validated at least annually, and the Company completes a detailed variance analysis of historical model projections against actual observed results on a quarterly basis. Required actions resulting from the Company's analysis, if necessary, are governed by its ACL Committee. Reserve levels are collectively reviewed for adequacy and approved quarterly by Board-level committees. |
Finance Receivables (Tables)
Finance Receivables (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Receivables [Abstract] | |
Summary of Financing Receivables Held for Investment | Finance receivables held for investment, net is comprised of the following at September 30, 2020 and December 31, 2019: September 30, 2020 December 31, 2019 Retail installment contracts, net (a) $ 27,415,437 $ 27,719,221 Purchased receivables - credit deteriorated 7,438 12,177 Receivables from dealers 3,668 12,536 Finance lease receivables (Note 4) 23,187 23,085 Finance receivables held for investment, net $ 27,449,730 $ 27,767,019 (a) The Company has elected the fair value option for certain retail installment contracts reported in finance receivables held for investment, net. As of September 30, 2020 and December 31, 2019, $8,248 and $22,353 of loans were recorded at fair value, respectively (Note 10). The Company’s held for investment portfolio of retail installment contracts is comprised of the following at September 30, 2020 and December 31, 2019: September 30, 2020 Retail Installment Contracts Non-TDR TDR Unpaid principal balance $ 29,667,444 $ 3,801,948 ACL (4,900,132) (1,248,522) Discount (net of subvention and participation) 1,004 (10,583) Capitalized origination costs and fees 100,750 3,528 Net carrying balance $ 24,869,066 $ 2,546,371 ACL as a percentage of unpaid principal balance 16.5 % 32.8 % ACL and discount as a percentage of unpaid principal balance 16.5 % 33.1 % December 31, 2019 Retail Installment Contracts Non-TDR TDR Unpaid principal balance $ 26,895,551 $ 3,859,040 Credit loss allowance - specific — (914,718) Credit loss allowance - collective (2,123,878) — Discount (net of subvention and participation) (67,484) (17,167) Capitalized origination costs and fees 84,961 2,916 Net carrying balance $ 24,789,150 $ 2,930,071 Allowance as a percentage of unpaid principal balance 7.9 % 23.7 % Allowance and discount as a percentage of unpaid principal balance 8.1 % 24.1 % |
Schedule of Carrying Values of Finance Receivables Held for Sale | The carrying value of the Company’s finance receivables held for sale, net is comprised of the following at September 30, 2020 and December 31, 2019: September 30, 2020 December 31, 2019 Personal loans $ 763,292 $ 1,007,105 |
Schedule of Sales of Retail Installment Contracts and Charged-off Assets | Sales of retail installment contracts to third parties and proceeds from sales of charged-off assets for the three and nine months ended September 30, 2020 and 2019 were as follows: Three Months Ended Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Sales of retail installment contracts to third parties $ 636,301 $ — $ 1,148,587 $ — Proceeds from sales of charged-off assets to third parties $ 9,144 $ 28,847 $ 30,019 $ 55,220 |
Credit Loss Allowance and Cre_2
Credit Loss Allowance and Credit Quality (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Loans and Leases Receivable Disclosure [Abstract] | |
Summary of Activity in Loan Loss Allowance | The activity in the ACL for the retail installment contracts for the three and nine months ended September 30, 2020 and 2019 was as follows: Three Months Ended September 30, 2020 Three Months Ended September 30, 2019 Retail Installment Contracts Retail Installment Contracts Non-TDR TDR Non-TDR TDR Balance — beginning of period $ 4,818,187 $ 1,037,628 $ 1,961,893 $ 1,156,303 Credit loss expense (a) 24,841 314,075 484,626 102,494 Charge-offs (b) (334,938) (200,352) (962,573) (381,490) Recoveries 392,042 97,171 567,846 183,305 Balance — end of period $ 4,900,132 $ 1,248,522 $ 2,051,792 $ 1,060,612 Nine Months Ended September 30, 2020 Nine Months Ended September 30, 2019 Retail Installment Contracts Retail Installment Contracts Non-TDR TDR Non-TDR TDR Balance — beginning of period $ 2,123,878 $ 914,718 $ 1,819,360 $ 1,416,743 Day 1 - Adjustment to allowance for adoption of CECL standard 2,030,473 71,833 — — Credit loss expense (a) 1,526,545 581,344 1,279,931 266,913 Charge-offs (b) (1,955,706) (617,536) (2,685,931) (1,217,650) Recoveries 1,174,942 298,163 1,638,432 594,606 Balance — end of period $ 4,900,132 $ 1,248,522 $ 2,051,792 $ 1,060,612 (a) Excluded from the credit loss expense is $13 million and $52 million related to retail installment contracts sold in an off-balance sheet securitization during the three and nine months ended September 30, 2020, respectively. In addition, credit loss expense includes a net of $72 million and $60 million in the credit loss expense related to retail installment contracts transferred to held for sale and returned to held for investment during the three and nine months ended September 30, 2020, respectively. Furthermore, credit loss expense includes $0 million and $20 million related to retail installment contracts transferred to held for sale during the three and nine months ended September 30, 2019, respectively. (b) Charge-offs for retail installment contracts includes partial write-down of loans to the collateral value less estimated costs to sell, for which a bankruptcy notice was received. There is no additional ACL on these loans. |
Summary of Delinquencies | A summary of delinquencies as of September 30, 2020, and December 31, 2019 is as follows: September 30, 2020 Finance Receivables Held for Investment Retail Installment Contract Loans Purchased Receivables Portfolios - credit deteriorated Total Percent Amortized cost, 30-59 days past due $ 1,673,713 $ 887 $ 1,674,600 5.0 % Amortized cost over 59 days 817,577 334 817,911 2.4 % Total delinquent balance at amortized cost (a) $ 2,491,290 $ 1,221 $ 2,492,511 7.4 % (a) The amount of accrued interest excluded from the disclosed amortized cost table is $64,970. December 31, 2019 Finance Receivables Held for Investment Retail Installment Contract Loans Purchased Receivables Portfolios - credit impaired Total Percent Principal, 30-59 days past due $ 2,972,495 $ 1,930 $ 2,974,425 9.7 % Delinquent principal over 59 days 1,578,452 1,596 1,580,048 5.1 % Total delinquent principal (a) $ 4,550,947 $ 3,526 $ 4,554,473 14.8 % (a) The table includes balances based on UPB. Difference between amortized cost and UPB was not material. |
Summary of Financing Receivables on Nonaccrual Status | The amortized cost basis of financial instruments that are either non-accrual with related expected credit loss or non-accrual without related expected credit loss for retail installment contracts is as follows: September 30, 2020 Non-accrual loans Non-accrual loans with no allowance (a) Interest income recognized on nonaccrual loans (YTD) Non-accrual loans as a percent of total amortized cost Non-TDR $ 623,428 $ 141,269 $ 57,275 1.9 % TDR 301,647 46,956 27,128 0.9 % Total non-accrual loans $ 925,075 $ 188,225 $ 84,403 2.8 % (a) These represent loans for which a bankruptcy notice was received, and have been partially write-down to the collateral value less estimated costs to sell. Accordingly, there is no additional ACL on these loans. December 31, 2019 Amount Percent Non-TDR $ 1,099,462 3.6 % TDR 516,119 1.7 % Total nonaccrual principal (a) $ 1,615,581 5.3 % (a) The table includes balances based on UPB. Difference between amortized cost and UPB was not material. |
Financing Receivable Credit Quality Indicators | Total September 30, 2020 2020 (a) 2019 2018 2017 2016 2015 Prior Amount % No-FICO ® s 1,395 1,318 608 595 305 174 40 4,435 13.2% <540 1,444 1,517 1,022 516 305 223 116 5,143 15.3% 540-599 3,307 3,345 1,960 768 495 322 127 10,324 30.7% 600-639 2,101 2,059 1,120 384 272 158 65 6,159 18.4% >640 4,226 1,592 922 308 244 163 48 7,503 22.4% Total (b) $ 12,473 $ 9,831 $ 5,632 $ 2,571 $ 1,621 $ 1,040 $ 396 $ 33,564 100.0% (a) Represents nine months ended September 30, 2020 (b) The amount of accrued interest excluded from the disclosed amortized cost table is $428 million . FICO® Band December 31, 2019 (a) No-FICO®s 12.4% <540 16.9% 540-599 31.9% 600-639 19.0% >640 19.8% (a) Percentages are based on UPB. Difference between amortized cost and UPB was not material. |
Summary of TDRs | The table below presents the Company’s amortized cost (including accrued interest) of TDRs as of September 30, 2020 and December 31, 2019: September 30, 2020 December 31, 2019 Retail Installment Contracts (a) Amortized Cost including accrued interest (b) $ 3,843,470 $ 3,828,892 Impairment (1,248,522) (914,718) Amortized cost including accrued interest, net of impairment $ 2,594,948 $ 2,914,174 (a) The December 31, 2019 balances were based on unpaid principal balance. Difference between amortized cost and UPB was not material. (b) As of September 30, 2020, these balances excludes $74.0 million of collateral-dependent bankruptcy TDRs that have been written down by $27.1 million to fair value less cost to sell. As of December 31, 2019, this balance excludes $94.9 million of collateral-dependent bankruptcy TDRs that have been written down by $36.4 million to fair value less cost to sell. A summary of the amortized cost (including accrued interest) of the Company’s delinquent TDRs at September 30, 2020 and December 31, 2019 is as follows: September 30, 2020 December 31, 2019 Retail Installment Contracts (a) 30-59 days past due $ 564,838 $ 927,952 Delinquent balance over 59 days 287,289 521,709 Total delinquent TDRs $ 852,127 $ 1,449,661 (a) The December 31, 2019 balances were based on unpaid principal balance. Difference between amortized cost and UPB was not material. The decrease in total delinquent TDRs is primarily due to the significant increase in deferrals granted to borrowers impacted by COVID-19. The additional risk of these deferrals is captured in the ACL for retail installment contracts for the three and nine months ended September 30, 2020. Average amortized cost (including accrued interest) and interest income recognized on TDR loans are as follows: Three Months Ended Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Retail Installment Contracts Retail Installment Contracts Average amortized cost (including accrued interest) $ 3,960,119 $ 4,399,099 $ 3,802,823 $ 4,790,378 Interest income recognized 165,637 188,331 457,642 623,324 The following table summarizes the financial effects, excluding impacts related to credit loss allowance and impairment, of TDRs (including collateral-dependent bankruptcy TDRs) that occurred for the three and nine months ended September 30, 2020 and 2019: Three Months Ended Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Retail Installment Contracts Retail Installment Contracts Amortized cost (including accrued interest) before TDR $ 317,455 $ 376,206 $ 1,399,813 $ 1,003,755 Amortized cost (including accrued interest) after TDR 319,027 377,750 1,417,480 1,006,637 Number of contracts (not in thousands) 14,620 21,575 69,786 58,783 Three Months Ended Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Retail Installment Contracts Retail Installment Contracts Amortized cost (including accrued interest) in TDRs that subsequently defaulted (a) $ 83,002 $ 83,254 $ 183,871 $ 299,619 Number of contracts (not in thousands) 4,379 5,190 10,467 18,097 (a) For TDR modifications and TDR modifications that subsequently default, the allowance methodology remains unchanged; however, the transition rates of the TDR loans are adjusted to reflect the respective risks. |
Leases (SC as Lessor) (Tables)
Leases (SC as Lessor) (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Leases [Abstract] | |
Summary of Leased Vehicles, Net | Leased vehicles, net, which is comprised of leases originated under the Chrysler Agreement, consisted of the following as of September 30, 2020 and December 31, 2019: September 30, 2020 December 31, 2019 Leased vehicles $ 21,795,939 $ 21,722,726 Less: accumulated depreciation (4,694,217) (4,159,944) Depreciated net capitalized cost 17,101,722 17,562,782 Manufacturer subvention payments, net of accretion (972,778) (1,177,342) Origination fees and other costs 66,432 76,542 Net book value $ 16,195,376 $ 16,461,982 |
Summary of Maturity of Operating Lease Payments to be Received | The following summarizes the maturity analysis of lease payments due to the Company as lessor under operating leases as of September 30, 2020: Remainder of 2020 $ 745,650 2021 2,304,011 2022 1,218,588 2023 428,287 2024 7,852 Thereafter — Total $ 4,704,388 |
Schedule of Finance Lease Receivables, Net | Finance lease receivables, net consisted of the following as of September 30, 2020 and December 31, 2019: September 30, 2020 December 31, 2019 Gross investment in finance leases $ 34,290 $ 34,443 Origination fees and other 288 241 Less: unearned income (7,673) (6,859) Net investment in finance leases before allowance 26,905 27,825 Less: allowance for lease losses (a) (3,718) (4,740) Net investment in finance leases $ 23,187 $ 23,085 (a) The impact of day 1 - Adjustment to allowance for adoption of CECL standard was insignificant. |
Summary of Maturity of Finance Lease Payments to be Received | The following summarizes the maturity analysis of lease payments due to the Company, as lessor, under finance leases as of September 30, 2020: Remainder of 2020 $ 2,685 2021 10,066 2022 8,793 2023 6,780 2024 4,262 Thereafter 1,704 Total $ 34,290 |
Other Assets (Tables)
Other Assets (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Other Assets, Leases And Investments [Abstract] | |
Schedule of Other Assets | Other assets were comprised as follows: September 30, 2020 December 31, 2019 Vehicles (a) $ 370,678 $ 341,465 Manufacturer subvention payments receivable (b) 38,414 74,738 Upfront fee (b) 76,709 98,980 Derivative assets at fair value (c) 5,999 65,358 Derivative - collateral 104,435 147,914 Operating leases (Right-of-use-assets) 49,443 57,508 Available-for-sale debt securities 95,666 92,246 Held-to-maturity debt securities (d) 50,417 — Equity securities not held for trading 1,430 — Prepaids 44,458 45,644 Accounts receivable 34,898 24,103 Federal and State tax receivable 104,667 82,945 Other 65,451 40,119 Other assets $ 1,042,665 $ 1,071,020 (a) Includes vehicles recovered through repossession as well as vehicles recovered due to lease terminations. (b) These amounts relate to the Chrysler Agreement. The Company paid a $150,000 upfront fee upon the May 2013 inception of the Chrysler Agreement. The fee is being amortized into finance and other interest income over a ten (c) Derivative assets at fair value represent the gross amount of derivatives presented in the condensed consolidated financial statements. Refer to Note 9 - "Derivative Financial Instruments" to these condensed Consolidated Financial Statements for the detail of these amounts. |
Supplemental Information Related to Operating Leases | Supplemental information relating to these operating leases is as follows: September 30, 2020 Operating leases-right of use assets $ 49,443 Other liabilities 68,545 Weighted average lease term 5.6 Weighted average discount rate 3.4 % |
Schedule of Maturity of Lease Liabilities | The maturity of lease liabilities at September 30, 2020 are as follows: September 30, 2020 2020 $ 4,175 2021 13,343 2022 12,639 2023 12,762 2024 12,701 Thereafter 19,691 Total $ 75,311 Less: Interest (6,766) Present value of lease liabilities $ 68,545 |
Schedule of Debt Securities, AFS | The following tables present the amortized cost, gross unrealized gains and losses and approximate fair values of debt securities available-for-sale and held-to-maturity debt securities as of September 30, 2020: September 30, 2020 Amortized cost (before unrealized gains / losses) Gross Unrealized gain Gross Unrealized loss Fair value Available-for-sale debt securities (US Treasury securities) $ 92,621 $ 3,045 $ — $ 95,666 Held-to-maturity debt securities (Asset-Backed Notes) $ 50,381 $ 561 $ — $ 50,942 Contractual Maturities The contractual maturities of available-for-sale and held-to-maturity debt instruments are summarized in the following table: September 30, 2020 Available-for-sale debt securities Held-to-maturity debt securities Amortized cost Fair value Amortized cost Fair value Due within one year $ 4,978 $ 5,096 $ 3,416 $ 3,416 Due after one year but within 5 years 87,643 90,570 34,178 34,320 Due after 5 year but within 10 years — — 12,787 13,206 Total $ 92,621 $ 95,666 $ 50,381 $ 50,942 |
Variable Interest Entities (Tab
Variable Interest Entities (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Variable Interest Entity Disclosure [Abstract] | |
Schedule of Variable Interest Entities | The assets of consolidated VIEs, presented based upon the legal transfer of the underlying assets in order to reflect legal ownership, that can be used only to settle obligations of the consolidated VIE and the liabilities of these entities for which creditors (or beneficial interest holders) do not have recourse to the Company’s general credit were as follows: September 30, 2020 December 31, 2019 Assets Restricted cash $ 1,763,252 $ 1,629,870 Finance receivables held for investment, net 22,711,254 26,532,328 Leased vehicles, net 16,195,376 16,461,982 Various other assets 870,229 625,359 Total assets $ 41,540,111 $ 45,249,539 Liabilities Notes payable $ 31,265,215 $ 34,249,851 Various other liabilities 117,997 188,093 Total liabilities $ 31,383,212 $ 34,437,944 |
Summary of Cash Flows Received from Consolidated Securitization Trusts | A summary of the cash flows received from consolidated securitization trusts during the three and nine months ended September 30, 2020 and 2019, is as follows: Three Months Ended Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Assets securitized $ 5,282,901 $ 5,498,705 $ 15,845,707 $ 15,340,428 Net proceeds from new securitizations (a) $ 4,662,211 $ 4,475,722 $ 11,470,857 $ 12,232,777 Net proceeds from retained bonds 1,293 2,414 57,286 119,719 Cash received for servicing fees (b) 242,245 242,801 735,533 740,760 Net distributions from Trusts (b) 1,173,276 1,018,301 2,730,657 2,689,735 Total cash received from Trusts $ 6,079,025 $ 5,739,238 $ 14,994,333 $ 15,782,991 (a) Includes additional advances on existing securitizations. (b) These amounts are not reflected in the accompanying condensed consolidated statements of cash flows because these cash flows are intra-company and eliminated in consolidation. Three Months Ended Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Receivables securitized (a) $ 636,301 $ — $ 1,148,587 $ — Net proceeds from new securitizations 592,455 — 1,052,541 — Cash received for servicing fees 6,598 7,859 17,856 27,467 Total cash received from securitization trusts 599,053 7,859 1,070,397 27,467 (a) Represents the unpaid principal balance at the time of original securitization. |
Off-balance Sheet Variable Interest Entities Portfolio | The portfolio was comprised as follows: September 30, 2020 December 31, 2019 Related party SPAIN serviced securitizations $ 1,418,346 $ 2,149,008 Third party SCART serviced securitizations 1,032,639 — Third party CCAP serviced securitizations 103,579 259,197 Total serviced for others portfolio $ 2,554,564 $ 2,408,205 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | Total borrowings and other debt obligations as of September 30, 2020 and December 31, 2019 consists of: September 30, 2020 December 31, 2019 Notes Payable — Facilities with Third Parties $ 2,803,684 $ 5,399,931 Notes Payable — Secured Structured Financings 27,356,867 28,141,885 Notes Payable — Secured Structured Financing with Santander 7,222 — Notes Payable — Facilities with Santander and Related Subsidiaries 11,201,574 5,652,325 $ 41,369,347 $ 39,194,141 |
Schedule of Credit Facilities | The following table presents information regarding the Company’s credit facilities as of September 30, 2020 and December 31, 2019: September 30, 2020 Maturity Date(s) Utilized Balance Committed Amount Effective Rate Assets Pledged Restricted Cash Pledged Facilities with third parties: Warehouse line August 2022 $ 166,000 $ 500,000 2.54% $ 267,776 $ — Warehouse line March 2021 500,445 1,250,000 1.27% 1,151,745 1 Warehouse line (a) October 2021 92,800 1,500,000 2.69% 819,518 — Warehouse line (b) October 2021 1,165,943 3,500,000 3.27% 1,272,926 — Warehouse line July 2021 — 500,000 1.53% 497,994 — Warehouse line October 2021 — 2,100,000 4.18% — — Warehouse line January 2022 400,000 1,000,000 1.43% 572,755 — Warehouse line November 2021 166,600 500,000 1.04% 495,011 — Warehouse line July 2022 — 900,000 3.10% — 1,684 Repurchase facility (c) January 2021 263,272 263,272 1.66% 377,550 — Repurchase facility (c) November 2020 48,624 48,624 1.79% 69,945 — Total facilities with third parties 2,803,684 12,061,896 5,525,220 1,685 Facilities with Santander and related subsidiaries: Promissory Note December 2021 250,000 250,000 3.70% — — Promissory Note December 2022 250,000 250,000 3.95% — — Promissory Note December 2023 250,000 250,000 5.25% — — Promissory Note December 2022 250,000 250,000 5.00% — — Promissory Note May 2021 250,000 250,000 2.25% — — Promissory Note March 2021 300,000 300,000 3.95% — — Promissory Note May 2023 350,000 350,000 3.80% — — Promissory Note October 2020 400,000 400,000 4.03% — — Promissory Note November 2022 400,000 400,000 3.00% — — Promissory Note April 2023 450,000 450,000 6.13% — — Promissory Note June 2022 500,000 500,000 3.30% — — Promissory Note July 2024 500,000 500,000 3.90% — — Promissory Note March 2022 650,000 650,000 4.20% — — Promissory Note August 2021 650,000 650,000 3.44% — — Promissory Note September 2023 750,000 750,000 3.38% — — Promissory Note June 2025 1,000,000 1,000,000 3.99% — — Promissory Note June 2022 2,000,000 2,000,000 1.40% — — Promissory Note September 2022 2,000,000 2,000,000 1.04% — — Line of credit July 2021 — 500,000 2.18% — — Line of credit March 2022 — 2,500,000 3.35% — — Total facilities with Santander and related subsidiaries 11,200,000 14,200,000 — — Total revolving credit facilities $ 14,003,684 $ 26,261,896 $ 5,525,220 $ 1,685 (a) During the three months ended March 31, 2020, Chrysler Finance Loan credit facility was reactivated with a $1 billion commitment. In April 2020, the commitment amount was increased by $500 million. (b) This line is held exclusively for financing of Chrysler Finance leases. In April 2020, the commitment amount was reduced by $500 million. (c) The repurchase facilities are collateralized by securitization notes payable retained by the Company. As the borrower, we are exposed to liquidity risk due to changes in the market value of the retained securities pledged. In some instances, we place or receive cash collateral with counterparties under collateral arrangements associated with our repurchase agreements. December 31, 2019 Maturity Date(s) Utilized Balance Committed Amount Effective Rate Assets Pledged Restricted Cash Pledged Facilities with third parties: Warehouse line June 2021 $ 471,284 $ 500,000 3.32% $ 675,426 $ — Warehouse line March 2021 516,045 1,250,000 3.10% 734,640 1 Warehouse line October 2021 1,098,443 5,000,000 4.43% 1,898,365 1,756 Warehouse line July 2021 500,000 500,000 3.64% 761,690 302 Warehouse line October 2021 896,077 2,100,000 3.44% 1,748,325 7 Repurchase facility January 2020 273,655 273,655 3.80% 377,550 — Repurchase facility March 2020 100,756 100,756 3.04% 151,710 — Repurchase facility March 2020 47,851 47,851 3.15% 69,945 — Warehouse line November 2020 970,600 1,000,000 2.57% 1,353,305 — Warehouse line November 2020 471,320 500,000 2.69% 505,502 186 Warehouse line June 2021 53,900 600,000 7.02% 62,601 94 Total facilities with third parties 5,399,931 11,872,262 8,339,059 2,346 Facilities with Santander and related subsidiaries: Promissory Note December 2021 250,000 250,000 3.70% — — Promissory Note December 2022 250,000 250,000 3.95% — — Promissory Note December 2023 250,000 250,000 5.25% — — Promissory Note December 2022 250,000 250,000 5.00% — — Promissory Note March 2021 300,000 300,000 3.95% — — Promissory Note October 2020 400,000 400,000 3.10% — — Promissory Note November 2022 400,000 400,000 3.00% — — Promissory Note May 2020 500,000 500,000 3.49% — — Promissory Note June 2022 500,000 500,000 3.30% — — Promissory Note July 2024 500,000 500,000 3.90% — — Promissory Note March 2022 650,000 650,000 4.20% — — Promissory Note August 2021 650,000 650,000 3.44% — — Promissory Note September 2023 750,000 750,000 3.27% — — Line of credit July 2021 — 500,000 3.86% — — Line of credit March 2022 — 3,000,000 4.96% — — Total facilities with Santander and related subsidiaries 5,650,000 9,150,000 — — Total revolving credit facilities $ 11,049,931 $ 21,022,262 $ 8,339,059 $ 2,346 |
Summary of Secured Structured Financings | The following table presents information regarding secured structured financings as of September 30, 2020 and December 31, 2019: September 30, 2020 Estimated Maturity Date(s) at Issuance Balance Initial Note Amounts Issued (d) Initial Weighted Average Interest Rate Collateral (b) Restricted Cash 2016 Securitizations April 2022 - March 2024 $ 520,566 $ 4,878,390 1.63% - 2.46% $ 710,108 $ 165,372 2017 Securitizations July 2022 - September 2024 1,252,708 8,262,940 1.35% - 2.52% 1,921,996 228,862 2018 Securitizations May 2022 - April 2026 3,297,883 12,039,840 2.41% - 3.42% 4,853,413 417,727 2019 Securitizations (e) May 2024 - February 2027 7,365,406 11,924,720 2.08% - 3.34% 8,999,694 503,999 2020 Securitizations (e) November 2024 - May 2028 6,372,892 7,291,465 0.76% - 2.73% 7,798,089 421,219 Public Securitizations (a) 18,809,455 44,397,355 24,283,300 1,737,179 2013 Private issuances July 2024 - September 2024 1,106,654 1,537,025 1.28% 2,189,789 751 2018 Private issuances June 2022 - April 2024 3,329,885 4,536,002 2.42% - 3.53% 5,028,329 8,294 2019 Private issuance September 2022 - November 2026 2,839,895 3,524,536 2.45% - 3.90% 3,743,384 10,441 2020 Private issuance April 2024 - December 2027 1,278,200 1,500,000 1.29% - 2.68% 1,533,617 4,902 Privately issued amortizing notes (c) 8,554,634 11,097,563 12,495,119 24,388 Total secured structured financings $ 27,364,089 $ 55,494,918 $ 36,778,419 $ 1,761,567 (a) Securitizations executed under Rule 144A of the Securities Act are included within this balance. (b) Secured structured financings may be collateralized by the Company’s collateral overages of other issuances. (c) All privately issued amortizing notes issued in 2014 through 2017 were paid in full. (d) Excludes securitizations which no longer have outstanding debt and excludes any incremental borrowings. (e) As of the September 30, 2020 , $7.2 million in secured structured financing is held by Santander. December 31, 2019 Estimated Maturity Date(s) at Issuance Balance Initial Note Amounts Issued Initial Weighted Average Interest Rate Collateral Restricted Cash 2015 Securitizations August 2021 - January 2023 $ 334,916 $ 3,258,300 1.67% - 2.29% $ 411,310 $ 94,382 2016 Securitizations April 2022- March 2024 1,144,421 7,462,790 1.63% - 2.80% 1,560,133 248,784 2017 Securitizations July 2022 - September 2024 2,364,177 9,296,570 1.35% - 2.52% 3,423,303 292,601 2018 Securitizations May 2022 - April 2026 5,376,231 12,039,840 2.41% - 3.42% 7,240,151 466,069 2019 Securitizations May 2024 - February 2027 9,588,028 11,924,720 2.08% - 3.34% 12,062,261 504,810 Public Securitizations 18,807,773 43,982,220 24,697,158 1,606,646 2013 Private issuances July 2024- September 2024 2,252,616 1,537,025 1.28% 2,143,065 303 2015 Private issuances July 2019 19,029 500,000 1.05% 67,007 113 2016 Private issuances September 2024 30,943 300,000 2.35% 90,352 — 2018 Private issuance June 2022-April 2024 3,742,509 4,536,002 2.42% - 3.53% 5,292,020 10,114 2019 Private issuance September 2022 - November 2026 3,289,015 3,524,536 2.45% - 3.90% 4,455,773 10,348 Privately issued amortizing notes 9,334,112 10,397,563 12,048,217 20,878 Total secured structured financings $ 28,141,885 $ 54,379,783 $ 36,745,375 $ 1,627,524 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
Class of Treasury Stock | Please find below the details of the Company's tender offer and other share repurchase programs for the three and nine months ended September 30, 2020 and 2019 : Three Months Ended Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Tender offer (a): Number of shares purchased — — 17,514,707 — Average price per share $ — $ — $ 26.00 $ — Cost of shares purchased (b) $ — $ — $ 455,382 $ — Other share repurchases: Number of shares purchased 10,198,800 5,479,650 15,956,561 10,194,772 Average price per share $ 21.91 $ 25.71 $ 20.00 $ 24.08 Cost of shares purchased (b) $ 223,485 $ 140,909 $ 319,075 $ 245,496 Total number of shares purchased 10,198,800 5,479,650 33,471,268 10,194,772 Average price per share $ 21.91 $ 25.71 $ 23.14 $ 24.08 Total cost of shares purchased (b) $ 223,485 $ 140,909 $ 774,457 $ 245,496 (a) During the three months ended March 31, 2020, the Company purchased shares of its common stock through a modified Dutch Auction Tender Offer. (b) Cost of shares exclude commissions |
Summary of Changes in Accumulated Other Comprehensive Income (Loss), Net of Tax | A summary of changes in accumulated other comprehensive income (loss), net of tax, for the three and nine months ended September 30, 2020 and 2019 is as follows: Three Months Ended Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Beginning balance, unrealized gains (losses) $ (63,705) $ (20,567) $ (26,693) $ 33,515 Other comprehensive income (loss) before reclassifications (gross) 94 (5,018) (43,212) (38,696) Amounts (gross) reclassified out of accumulated other comprehensive income (loss) 6,729 (6,251) 13,023 (26,655) Ending balance, unrealized gains (losses) $ (56,882) $ (31,836) $ (56,882) $ (31,836) |
Reclassification of Amounts Out of Accumulated Other Comprehensive Income (Loss) | Amounts (gross) reclassified out of accumulated other comprehensive income (loss) during the three and nine months ended September 30, 2020 and 2019 consist of the following: Three Months Ended Nine Months Ended Income statement line item Reclassification September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Cash flow hedges $ 8,939 $ (8,283) $ 17,260 $ (35,224) Interest expense Available-for-sale — — — — Investment gain/loss Tax benefit (2,210) 2,032 (4,237) 8,569 Net of tax $ 6,729 $ (6,251) $ 13,023 $ (26,655) |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Summary of Underlying Notional Amounts and Aggregate Fair Values | The underlying notional amounts of these derivative financial instruments at September 30, 2020 and December 31, 2019, are as follows: September 30, 2020 December 31, 2019 Notional Asset Liability Notional Asset Liability Interest rate swap agreements designated as cash flow hedges $ 2,750,000 $ — $ (79,350) $ 2,650,000 $ 2,807 $ (39,128) Interest rate swap agreements not designated as hedges 250,000 — (14,393) 1,281,000 — (10,267) Interest rate cap agreements 11,117,779 5,999 — 9,379,720 62,552 — Options for interest rate cap agreements 11,117,779 — (5,999) 9,379,720 — (62,552) |
Schedule of Offsetting Financial Assets | Information on the offsetting of derivative assets and derivative liabilities due to the right of offset was as follows, as of September 30, 2020 and December 31, 2019: Gross Amounts Not Offset in the Assets Presented Collateral Net September 30, 2020 Interest rate caps - Santander and affiliates $ 815 $ — $ 815 Interest rate caps - third party 5,184 (5,184) — Total derivatives subject to a master netting arrangement or similar arrangement 5,999 (5,184) 815 Total derivatives not subject to a master netting arrangement or similar arrangement — — — Total derivative assets $ 5,999 $ (5,184) $ 815 Total financial assets $ 5,999 $ (5,184) $ 815 December 31, 2019 Interest rate swaps - third party (b) $ 2,807 $ (540) $ 2,267 Interest rate caps - Santander and affiliates 25,330 (14,930) 10,400 Interest rate caps - third party 37,222 (26,199) 11,023 Total derivatives subject to a master netting arrangement or similar arrangement 65,359 (41,669) 23,690 Total derivatives not subject to a master netting arrangement or similar arrangement — — — Total derivative assets $ 65,359 $ (41,669) $ 23,690 Total financial assets $ 65,359 $ (41,669) $ 23,690 (a) Collateral received includes cash, cash equivalents, initial margin and other financial instruments. Cash collateral received is reported in Other liabilities in the consolidated balance sheet. Financial instruments that are pledged to the Company are not reflected in the accompanying balance sheet since the Company does not control or have the ability of rehypothecation of these instruments. In certain instances, the counter party is over-collateralized since the actual amount of collateral received exceeds the associated financial asset. As a result, the actual amount of collateral received that is reported may be greater than the amount shown in the table above. (b) Includes derivative instruments originally transacted with Santander and affiliates and subsequently amended to reflect clearing with central clearing counterparties. |
Schedule of Offsetting Financial Liabilities | Gross Amounts Not Offset in the condensed Consolidated Balance Sheet Liabilities Presented Collateral Net September 30, 2020 Interest rate swaps - third party (b) $ 93,743 $ (93,743) $ — Interest rate caps - Santander and affiliates 815 (815) — Interest rate caps - third party 5,184 (4,193) 991 Total derivatives subject to a master netting arrangement or similar arrangement 99,742 (98,751) 991 Total derivatives not subject to a master netting arrangement or similar arrangement — — — Total derivative liabilities $ 99,742 $ (98,751) $ 991 Total financial liabilities $ 99,742 $ (98,751) $ 991 December 31, 2019 Interest rate swaps - third party $ 49,395 $ (49,395) $ — Interest rate caps - Santander and affiliates 25,330 (25,330) — Interest rate caps - third party 37,222 (37,222) — Total derivatives subject to a master netting arrangement or similar arrangement 111,947 (111,947) — Total derivatives not subject to a master netting arrangement or similar arrangement — — — Total derivative liabilities $ 111,947 $ (111,947) $ — Total financial liabilities $ 111,947 $ (111,947) $ — (a) Collateral pledged includes cash, cash equivalents, initial margin and other financial instruments. These balances are reported in Other assets in the consolidated balance sheet. In certain instances, the Company is over-collateralized since the actual amount of collateral pledged exceeds the associated financial liability. As a result, the actual amount of collateral pledged that is reported in Other assets may be greater than the amount shown in the table above. (b) Includes derivative instruments originally transacted with Santander and affiliates and subsequently amended to reflect clearing with central clearing counterparties. |
Schedule of Net Investment Hedges in Accumulated Other Comprehensive Income (Loss) | The impacts on the consolidated statements of income and comprehensive income for the three and nine months ended September 30, 2020 and 2019 were as follows: Three Months Ended September 30, 2020 Recognized in Earnings Gross Gains (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) Gross amount Reclassified From Accumulated Other Comprehensive Interest rate swap agreements designated as cash flow hedges $ — $ 256 $ (8,939) Derivative instruments not designated as hedges Losses (Gains) recognized in interest expenses $ 567 Three Months Ended September 30, 2019 Recognized in Earnings Gross Gains (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) Gross amount Reclassified From Accumulated Other Comprehensive Interest rate swap agreements designated as cash flow hedges $ — $ (6,485) $ 8,283 Derivative instruments not designated as hedges Losses (Gains) recognized in interest expenses $ 903 Nine Months Ended September 30, 2020 Recognized in Earnings Gross Gains (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) Gross amount Reclassified From Accumulated Other Comprehensive Interest rate swap agreements designated as cash flow hedges $ — $ (59,405) $ (17,260) Derivative instruments not designated as hedges Losses (Gains) recognized in interest expenses $ 10,774 Nine Months Ended September 30, 2019 Recognized in Earnings Gross Gains (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) Gross amount Reclassified From Accumulated Other Comprehensive Interest rate swap agreements designated as cash flow hedges $ — $ (52,292) $ 35,224 Derivative instruments not designated as hedges Losses (Gains) recognized in interest expenses $ 14,750 |
Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss) | The impacts on the consolidated statements of income and comprehensive income for the three and nine months ended September 30, 2020 and 2019 were as follows: Three Months Ended September 30, 2020 Recognized in Earnings Gross Gains (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) Gross amount Reclassified From Accumulated Other Comprehensive Interest rate swap agreements designated as cash flow hedges $ — $ 256 $ (8,939) Derivative instruments not designated as hedges Losses (Gains) recognized in interest expenses $ 567 Three Months Ended September 30, 2019 Recognized in Earnings Gross Gains (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) Gross amount Reclassified From Accumulated Other Comprehensive Interest rate swap agreements designated as cash flow hedges $ — $ (6,485) $ 8,283 Derivative instruments not designated as hedges Losses (Gains) recognized in interest expenses $ 903 Nine Months Ended September 30, 2020 Recognized in Earnings Gross Gains (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) Gross amount Reclassified From Accumulated Other Comprehensive Interest rate swap agreements designated as cash flow hedges $ — $ (59,405) $ (17,260) Derivative instruments not designated as hedges Losses (Gains) recognized in interest expenses $ 10,774 Nine Months Ended September 30, 2019 Recognized in Earnings Gross Gains (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) Gross amount Reclassified From Accumulated Other Comprehensive Interest rate swap agreements designated as cash flow hedges $ — $ (52,292) $ 35,224 Derivative instruments not designated as hedges Losses (Gains) recognized in interest expenses $ 14,750 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Assets and Liabilities Measured at Fair Value on a Recurring Basis | The following tables present the Company’s assets and liabilities that are measured at fair value on a recurring basis at September 30, 2020 and December 31, 2019, and the level within the fair value hierarchy: Level 1 Level 2 Level 3 Balance at September 30, 2020 Level 1 Level 2 Level 3 Balance at December 31, 2019 Other assets: Trading interest rate caps (a) $ — $ 5,999 $ — $ 5,999 $ — $ 62,552 $ — $ 62,552 Cash flow hedging interest rate swaps (a) — — — $ — — 2,807 — $ 2,807 Available-for-sale-debt securities (b) — 95,666 — $ 95,666 — 92,246 — $ 92,246 Other liabilities: Trading options for interest rate caps (a) — 5,999 — $ 5,999 — 62,552 — $ 62,552 Cash flow hedging interest rate swaps (a) — 79,350 — $ 79,350 — 39,128 — $ 39,128 Trading interest rate swaps (a) — 14,393 — $ 14,393 — 10,267 — $ 10,267 Retail installment contracts (c)(d) — — 8,248 $ 8,248 — 17,634 4,719 $ 22,353 (a) The valuation is determined using widely accepted valuation techniques including a DCF on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivative, including the period to maturity, and uses observable market-based inputs. The Company incorporates credit valuation adjustments to appropriately reflect both its own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurement of its derivatives. In adjusting the fair value of its derivative contracts for the effect of nonperformance risk, the Company has considered the impact of netting and any applicable credit enhancements, such as collateral postings and guarantees. The Company utilizes the exception in ASC 820-10-35-18D (commonly referred to as the “portfolio exception”) with respect to measuring counterparty credit risk for instruments (Note 9). (b) The Company's AFS debt securities includes U.S. Treasury securities that are valued utilizing observable market quotes. The Company obtains vendor trading platform data (actual prices) from a number of live data sources, including active market makers and interdealer brokers and its securities are therefore, classified as Level 2. (c) For certain retail installment contracts reported in finance receivables held for investment, net, the Company has elected the fair value option. The fair values of the retail installment contracts are estimated using a DCF model are classified as Level 3. As of December 31, 2019, Company had used the most recent purchase price as the fair value for certain loans and hence classified those retail installment contracts as Level 2. Changes in the fair value are recorded in investment gains (losses), net in the condensed consolidated statement of income. (d) The aggregate fair value of retail installment contracts in non-accrual status, as of September 30, 2020 and December 31, 2019, i s $2,031 a nd $9,511, respectively. |
Changes in Level 3 Balances, Assets | The following table presents the changes in retail installment contracts held for investment balances classified as Level 3 balances for the three and nine months ended September 30, 2020 and 2019: Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Balance — beginning of year $ 10,585 $ 8,832 $ 4,719 $ 13,509 Additions / issuances — — 2,512 2,079 Transfer from level 2 (a) — — 17,634 — Net collection activities (2,410) (3,176) (16,854) (10,242) Gains recognized in earnings 73 632 237 942 Balance — end of year $ 8,248 $ 6,288 $ 8,248 $ 6,288 (a) The Company transferred retail installment contracts from Level 2 to Level 3 during the three months ended March 31, 2020 because the fair value for these assets could not be determined by using readily observable inputs at March 31, 2020. There we re no |
Assets and Liabilities Measured at Fair Value on Nonrecurring Basis | The following table presents the Company’s assets and liabilities that are measured at fair value on a nonrecurring basis at September 30, 2020 and December 31, 2019, respectively: Nine Months Ended September 30, 2020 Year Ended December 31, 2019 Total Lower of cost or fair value expense Total Lower of cost or fair value expense Other assets — vehicles (a) $ 370,678 $ — $ 341,465 $ — Personal loans held for sale (b) 763,292 241,198 1,007,105 408,700 Auto loans impaired due to bankruptcy (c) 188,226 — 200,504 9,106 ( a) The Company estimates the fair value of its vehicles, which are obtained either through repossession or lease termination, using historical auction rates and current market levels of used car prices. (b) The estimated fair value for personal loans held for sale is calculated based on the lower of market participant view and a DCF analysis in which the Company uses significant unobservable inputs on key assumptions. The lower of cost or fair value adjustment for personal loans held for sale includes customer default activity and adjustments related to the net change in the portfolio balance during the reporting period. (c) For loans that are considered collateral-dependent, such as certain bankruptcy loans, impairment is measured based on the fair value of the collateral, less its estimated cost to sell. For the underlying collateral, the estimated fair value is obtained using historical auction rates and current market levels of used car prices. No additional lower of cost or fair value expense was recorded for the nine months ended September 30, 2020. |
Quantitative Information About Significant Unobservable Inputs for Liabilities Measured at Fair Value | The following table presents quantitative information about the significant unobservable inputs for assets and liabilities measured at fair value on a recurring and nonrecurring basis at September 30, 2020 and December 31, 2019, respectively: Financial Instruments Fair Value at September 30, 2020 Valuation Technique Unobservable Inputs Range (weighted average) (a) Financial Assets: Retail installment contracts held for investment $ 8,248 Discounted Cash Flow Discount Rate 8%-14% (9%) Default Rate 4%-20% (5%) Prepayment Rate 15%-25% (15%) Loss Severity Rate 50%-60% (56%) Personal loans held for sale (b) $ 763,292 Lower of Market or Income Approach Market Approach Market Participant View 60%-70% Income Approach Discount Rate 20%-30% Default Rate 40%-50% Net Principal & Interest Payment Rate 65%-75% Loss Severity Rate 90%-95% (a) Weighted average was developed by weighting the associated relative unpaid principal balances. (b) The estimated fair value for personal loans held for sale (Bluestem) is calculated based on the lower of market participant view, a DCF analysis in which the Company uses significant unobservable inputs on key assumptions, and also considers the possible outcomes of the Bluestem bankruptcy process. Financial Instruments Fair Value at December 31, 2019 Valuation Technique Unobservable Inputs Range Financial Assets: Retail installment contracts held for investment $ 4,719 Discounted Cash Flow Discount Rate 8%-10% Default Rate 15%-20% Prepayment Rate 6%-8% Loss Severity Rate 50%-60% Personal loans held for sale $ 1,007,105 Lower of Market or Income Approach Market Approach Market Participant View 70%-80% Income Approach Discount Rate 15%-25% Default Rate 30%-40% Net Principal & Interest Payment Rate 70%-85% Loss Severity Rate 90%-95% |
Summary of Fair Value Estimates, Methods and Assumptions | The following tables present the carrying value and estimated fair value of the Company’s financial assets and liabilities disclosed, but not carried, at fair value at September 30, 2020 and December 31, 2019, and the level within the fair value hierarchy: September 30, 2020 December 31, 2019 Carrying Estimated Level 1 Level 2 Level 3 Carrying Estimated Level 1 Level 2 Level 3 Assets: Cash and cash equivalents (a) $ 105,616 $ 105,616 $ 105,616 $ — $ — $ 81,848 $ 81,848 $ 81,848 $ — $ — Finance receivables held for investment, net (b) 27,253,256 29,354,905 — — 29,354,905 27,544,162 28,133,427 — 1,009,358 27,124,069 Restricted cash (a) 2,267,154 2,267,154 2,267,154 — — 2,079,239 2,079,239 2,079,239 — — Investments in debt securities held to maturity (c) 50,381 50,942 — 50,942 — — — — — — Total $ 29,676,407 $ 31,778,617 $ 2,372,770 $ 50,942 $ 29,354,905 $ 29,705,249 $ 30,294,514 $ 2,161,087 $ 1,009,358 $ 27,124,069 Liabilities: Notes Payable: Facilities with third parties (d) $ 2,803,684 $ 2,803,684 $ — $ — $ 2,803,684 $ 5,399,931 $ 5,399,931 $ — $ — $ 5,399,931 Secured structured financings (e) 27,364,089 27,883,027 — 18,638,472 9,244,555 28,141,885 28,360,948 — 18,646,326 9,714,622 Facilities with Santander and related subsidiaries (f) 11,201,574 11,539,861 — — 11,539,861 5,652,325 5,724,675 — — 5,724,675 Total $ 41,369,347 $ 42,226,572 $ — $ 18,638,472 $ 23,588,100 $ 39,194,141 $ 39,485,554 $ — $ 18,646,326 $ 20,839,228 (a) Cash and cash equivalents and restricted cash — The carrying amount of cash and cash equivalents, including restricted cash, is at an approximated fair value as the instruments mature within 90 days or less and bear interest at market rates. (b) Finance receivables held for investment, net — Finance receivables held for investment, net are carried at amortized cost, net of an allowance. These receivables exclude retail installment contracts that are measured at fair value on a recurring and nonrecurring basis. The estimated fair value for the underlying financial instruments is determined as follows: • Retail installment contracts held for investment and purchased receivables - credit deteriorated — As of December 31, 2019 , the Company used the most recent purchase price as the fair value for certain loans and therefore, classified those retail installment contracts as Level 2. The estimated fair value of all finance receivables at September 30, 2020 is estimated using a DCF model, and such receivables are classified as Level 3. • Finance lease receivables — Finance lease receivables are carried at gross investments, net of unearned income and allowance for lease losses. Management believes that the terms of these credit agreements approximate market terms for similar credit agreements. • Receivables from dealers and personal loans held for investment — Receivables from dealers and personal loans held for investment are carried at amortized cost, net of credit loss allowance. Management believes that the terms of these credit agreements approximate market terms for similar credit agreements. (c) Investments in debt securities held to maturity - Investments in debt securities held to maturity are recorded at amortized cost and are priced by third-party pricing vendors. The third-party vendors use a variety of methods when pricing these securities that incorporate relevant observable market data to arrive at an estimate of what a buyer in the marketplace would pay for a security under current market conditions. These investment securities are, therefore, considered Level 2. (d) Notes payable — facilities with third parties — The carrying amount of notes payable related to revolving credit facilities is estimated to approximate fair value. Management believes that the terms of these credit agreements approximate market terms for similar credit agreements as the facilities are subject to short-term floating interest rates that approximate rates available to the Company. (e) Notes payable — secured structured financings — The estimated fair value of notes payable related to secured structured financings is calculated based on market observable prices and spreads for the Company’s publicly traded debt and market observed prices of similar notes issued by the Company, or recent market transactions involving similar debt with similar credit risks, which are considered Level 2 inputs. The estimated fair value of notes payable related to privately issued amortizing notes is calculated based on a combination of credit enhancement review, discounted cash flow analysis and review of market observable spreads for similar liabilities. In conducting this analysis, the Company uses significant unobservable inputs on key assumptions, which are considered Level 3 inputs. (f) Notes payable — facilities with Santander and related subsidiaries — The carrying amount of floating rate notes payable to a related party is estimated to approximate fair value as the facilities are subject to short-term floating interest rates that approximate rates available to the Company. The fair value premium/discount of the fixed rate promissory notes are derived from changes in the Company’s unsecured cost of funds since the time of issuance and weighted average life of these notes. |
Investment Losses, Net (Tables)
Investment Losses, Net (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Investment Gains (Losses), Net | Investment gains (losses), net was comprised of the following for the three and nine months ended September 30, 2020 and 2019: Three Months Ended Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Gain (loss) on sale of loans and leases $ (13,669) $ — $ (40,553) $ — Lower of cost or market adjustments (56,598) (87,454) (241,198) (239,166) Other gains, (losses and impairments), net 1,278 1,057 1,754 885 $ (68,989) $ (86,397) $ (279,997) $ (238,281) |
Computation of Basic and Dilu_2
Computation of Basic and Diluted Earnings per Common Share (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
Summary of Computation of Basic and Diluted Earnings per Common Share | The following table represents EPS numbers for the three and nine months ended September 30, 2020 and 2019: Three Months Ended Nine Months Ended 2020 2019 2020 2019 Earnings per common share Net income (loss) $ 490,115 $ 232,538 $ 389,450 $ 848,308 Weighted average number of common shares outstanding before restricted participating shares (in thousands) 310,150 345,470 321,276 349,342 Weighted average number of common shares outstanding (in thousands) 310,150 345,470 321,276 349,342 Earnings per common share $ 1.58 $ 0.67 $ 1.21 $ 2.43 Earnings per common share - assuming dilution Net income (loss) $ 490,115 $ 232,538 $ 389,450 $ 848,308 Weighted average number of common shares outstanding (in thousands) 310,150 345,470 321,276 349,342 Effect of employee stock-based awards (in thousands) 157 486 216 514 Weighted average number of common shares outstanding - assuming dilution (in thousands) 310,307 345,956 321,492 349,856 Earnings per common share - assuming dilution $ 1.58 $ 0.67 $ 1.21 $ 2.42 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Summary of Liabilities for Commitments and Contingencies | The following table summarizes liabilities recorded for commitments and contingencies as of September 30, 2020 and December 31, 2019, all of which are included in accounts payable and accrued expenses in the accompanying condensed consolidated balance sheets: Agreement or Legal Matter Commitment or Contingency September 30, 2020 December 31, 2019 Chrysler Agreement Revenue-sharing and gain/(loss), net-sharing payments $ 50,809 $ 12,132 Agreement with Bank of America Servicer performance fee 1,508 2,503 Agreement with CBP Loss-sharing payments 392 1,429 Other Contingencies Consumer arrangements 25,099 1,991 Legal and regulatory proceedings Aggregate legal and regulatory liabilities 45,047 137,000 Total commitments and contingencies $ 122,855 $ 155,055 |
Related-Party Transactions (Tab
Related-Party Transactions (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions | Other information on the serviced auto loan and retail installment contract portfolios for SBNA as of September 30, 2020 and December 31, 2019 is as follows: September 30, 2020 December 31, 2019 Total serviced portfolio $ 209,453 $ 277,669 Cash collections due to owner 17,793 14,908 Servicing fees receivable 1,938 738 Other information related to the above transactions with SBNA is as follows: Three Months Ended Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Origination and renewal fee income from SBNA $ 451 $ 1,291 $ 2,473 $ 4,218 Servicing fees expenses charged by SBNA (9) 52 63 113 Three Months Ended Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Servicing fee income $ 4,488 $ 4,743 $ 15,680 $ 20,885 |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Summary of Stock Options and Related Activity | A summary of the Company’s stock options and related activity as of and for the nine months ended September 30, 2020 is as follows: Shares Weighted Weighted Aggregate Options outstanding at January 1, 2020 273,737 $ 13.09 3.1 $ 2,867 Granted — — — — Exercised (67,241) 9.97 — 868 Expired (15,440) 25.89 — — Forfeited (13,460) 17.25 — — Other (a) — — — — Options outstanding at September 30, 2020 177,596 12.84 2.2 1,126 Options exercisable at September 30, 2020 177,596 $ 12.84 2.2 $ 1,126 Options expected to vest at September 30, 2020 — $ — — $ — (a) Represents stock options that were reinstated. |
Schedule of Nonvested Restricted Stock Units and Performance Stock Units Activity | A summary of the Company’s Restricted Stock Units and performance stock units and related activity as of and for the nine months ended September 30, 2020 is as follows: Shares Weighted Weighted Aggregate Outstanding as of January 1, 2020 498,299 $ 17.41 0.9 $ 11,645 Granted 268,438 24.02 — — Vested (365,740) 19.64 — 8,557 Forfeited/canceled (12,953) 17.97 — — Non-vested at September 30, 2020 388,044 $ 19.98 1.0 $ 7,059 |
Description of Business, Basi_3
Description of Business, Basis of Presentation, and Accounting Policies - Additional Information (Details) | 9 Months Ended |
Sep. 30, 2020segment | |
Basis Of Presentation And Significant Accounting Policies [Line Items] | |
Number of reportable segments | 1 |
Consumer Portfolio Segment | |
Basis Of Presentation And Significant Accounting Policies [Line Items] | |
Threshold period past due for nonaccrual state of financing receivables | 60 days |
SHUSA | |
Basis Of Presentation And Significant Accounting Policies [Line Items] | |
Ownership percentage held in the Company | 80.20% |
Public Shareholders | |
Basis Of Presentation And Significant Accounting Policies [Line Items] | |
Ownership percentage held in the Company | 19.80% |
Description of Business, Basi_4
Description of Business, Basis of Presentation, and Accounting Policies - Recently Adopted Accounting Standards (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | |||||
Sep. 30, 2020 | Dec. 31, 2019 | Jun. 30, 2020 | Jan. 01, 2020 | Sep. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2018 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Accounting Standards Update [Extensible List] | us-gaap:AccountingStandardsUpdate201613Member | ||||||
Allowance for credit loss | $ 6,152,378 | $ 3,043,468 | |||||
Decrease in retained earnings | 5,094,812 | $ 7,318,620 | $ 4,895,465 | $ 7,345,202 | $ 7,337,261 | $ 7,018,358 | |
ASU 2016-13 | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Accounting Standards Update [Extensible List] | us-gaap:AccountingStandardsUpdate201613Member | ||||||
Allowance for credit loss | $ 2,100,000 | ||||||
Deferred tax liabilities, net | 500,000 | ||||||
Retained Earnings | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Decrease in retained earnings | $ 4,754,205 | $ 6,168,659 | $ 4,331,454 | $ 6,097,295 | $ 5,940,886 | $ 5,465,748 | |
Retained Earnings | ASU 2016-13 | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Decrease in retained earnings | $ (1,600,000) |
Finance Receivables - Held for
Finance Receivables - Held for Investment (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Finance receivables held for investment, net | $ 27,449,730 | $ 27,767,019 |
Finance lease receivables | 23,187 | 23,085 |
Recurring | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Loans at fair value | 8,248 | 22,353 |
Financial Asset Acquired with Credit Deterioration | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Finance receivables held for investment, net | 7,438 | 12,177 |
Consumer Portfolio Segment | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Finance receivables held for investment, net | 27,415,437 | 27,719,221 |
Consumer Portfolio Segment | Recurring | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Loans at fair value | 8,248 | 22,353 |
Commercial Portfolio Segment | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Finance receivables held for investment, net | 3,668 | 12,536 |
Finance Leases Portfolio Segment | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Finance lease receivables | $ 23,187 | $ 23,085 |
Finance Receivables - Compositi
Finance Receivables - Composition of Held for Investment Portfolio (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
ACL | $ (6,152,378) | $ (3,043,468) |
Finance receivables held for investment, at amortized cost, net | 27,449,730 | 27,767,019 |
Consumer Portfolio Segment | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Finance receivables held for investment, at amortized cost, net | 27,415,437 | 27,719,221 |
Consumer Portfolio Segment | Non-TDR | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Unpaid principal balance | 29,667,444 | 26,895,551 |
ACL | (4,900,132) | (2,123,878) |
Discount (net of subvention and participation) | 1,004 | (67,484) |
Capitalized origination costs and fees | 100,750 | 84,961 |
Finance receivables held for investment, at amortized cost, net | $ 24,869,066 | $ 24,789,150 |
ACL as a percentage of unpaid principal balance | 16.50% | 7.90% |
ACL and discount as a percentage of unpaid principal balance | 16.50% | 8.10% |
Consumer Portfolio Segment | TDR | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Unpaid principal balance | $ 3,801,948 | $ 3,859,040 |
ACL | (1,248,522) | (914,718) |
Discount (net of subvention and participation) | (10,583) | (17,167) |
Capitalized origination costs and fees | 3,528 | 2,916 |
Finance receivables held for investment, at amortized cost, net | $ 2,546,371 | $ 2,930,071 |
ACL as a percentage of unpaid principal balance | 32.80% | 23.70% |
ACL and discount as a percentage of unpaid principal balance | 33.10% | 24.10% |
Finance Receivables - Additiona
Finance Receivables - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Schedule Of Financing Receivables [Line Items] | |||||
Loans classified as non-performing, period for classification | 60 days | ||||
Chrysler Capital Loans | |||||
Schedule Of Financing Receivables [Line Items] | |||||
Purchase of portfolios of finance receivables held for investment | $ 11,145,890,000 | $ 9,514,939,000 | |||
Chrysler Capital Loans | Credit Concentration Risk | Accounts Receivable | |||||
Schedule Of Financing Receivables [Line Items] | |||||
Concentration risk percentage | 61.00% | 56.00% | |||
Consumer Portfolio Segment | Nonperforming Financial Instruments | |||||
Schedule Of Financing Receivables [Line Items] | |||||
Financing receivable, purchased with credit deterioration, amount at par value | $ 0 | $ 0 | $ 76,878,000 | $ 74,718,000 | |
Loans classified as non-performing, period for classification | 60 days | ||||
Consumer Portfolio Segment | Geographic Concentration Risk | Borrower Location | Texas | |||||
Schedule Of Financing Receivables [Line Items] | |||||
Concentration risk percentage | 16.00% | ||||
Consumer Portfolio Segment | Geographic Concentration Risk | Borrower Location | Florida | |||||
Schedule Of Financing Receivables [Line Items] | |||||
Concentration risk percentage | 10.00% | ||||
Consumer Portfolio Segment | Geographic Concentration Risk | Borrower Location | California | |||||
Schedule Of Financing Receivables [Line Items] | |||||
Concentration risk percentage | 8.00% | ||||
Consumer Portfolio Segment | Geographic Concentration Risk | Borrower Location | Georgia | |||||
Schedule Of Financing Receivables [Line Items] | |||||
Concentration risk percentage | 5.00% | ||||
Consumer Portfolio Segment | Geographic Concentration Risk | Borrower Location | Other States (less than 5%) | |||||
Schedule Of Financing Receivables [Line Items] | |||||
Concentration risk percentage | 5.00% | ||||
Consumer Portfolio Segment | Commercial Fleet Contracts | |||||
Schedule Of Financing Receivables [Line Items] | |||||
Unpaid principal balance | $ 823,955,000 | $ 823,955,000 | $ 741,592,000 |
Finance Receivables - Schedule
Finance Receivables - Schedule of Carrying Values of Finance Receivables Held for Sale (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Finance receivable held for sale | $ 763,292 | $ 1,007,105 |
Consumer Portfolio Segment | Personal Loans | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Finance receivable held for sale | $ 763,292 | $ 1,007,105 |
Finance Receivables - Schedul_2
Finance Receivables - Schedule of Sales of Retail Installment Contracts and Charged-off Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Receivables [Abstract] | ||||
Sales of retail installment contracts to third parties | $ 636,301 | $ 0 | $ 1,148,587 | $ 0 |
Proceeds from sales of charged-off assets to third parties | $ 9,144 | $ 28,847 | $ 30,019 | $ 55,220 |
Credit Loss Allowance and Cre_3
Credit Loss Allowance and Credit Quality - Activity in Loan Loss Allowance (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Balance — beginning of period | $ 3,043,468 | |||
Credit loss expense | 2,110,331 | $ 1,548,404 | ||
Balance — end of period | $ 6,152,378 | 6,152,378 | ||
Proceeds from retail installment contracts sold | 13,000 | 52,000 | ||
Consumer Portfolio Segment | ||||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Transfers to held-for-sale | 72,000 | $ 0 | 60,000 | 20,000 |
Non-TDR | Consumer Portfolio Segment | ||||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Balance — beginning of period | 4,818,187 | 1,961,893 | 2,123,878 | 1,819,360 |
Credit loss expense | 24,841 | 484,626 | 1,526,545 | 1,279,931 |
Charge-offs | (334,938) | (962,573) | (1,955,706) | (2,685,931) |
Recoveries | 392,042 | 567,846 | 1,174,942 | 1,638,432 |
Balance — end of period | 4,900,132 | 2,051,792 | 4,900,132 | 2,051,792 |
Non-TDR | Cumulative Effect, Period Of Adoption, Adjustment | Consumer Portfolio Segment | ||||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Balance — beginning of period | 2,030,473 | 0 | ||
TDR | Consumer Portfolio Segment | ||||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Balance — beginning of period | 1,037,628 | 1,156,303 | 914,718 | 1,416,743 |
Credit loss expense | 314,075 | 102,494 | 581,344 | 266,913 |
Charge-offs | (200,352) | (381,490) | (617,536) | (1,217,650) |
Recoveries | 97,171 | 183,305 | 298,163 | 594,606 |
Balance — end of period | $ 1,248,522 | $ 1,060,612 | 1,248,522 | 1,060,612 |
TDR | Cumulative Effect, Period Of Adoption, Adjustment | Consumer Portfolio Segment | ||||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Balance — beginning of period | $ 71,833 | $ 0 |
Credit Loss Allowance and Cre_4
Credit Loss Allowance and Credit Quality - RICs and Delinquencies, Narrative (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2020 | Jan. 01, 2020 | Dec. 31, 2019 | |
Financing Receivable, Past Due [Line Items] | ||||
Financing receivable, allowance for credit loss, period increase (decrease) | $ 300,000,000 | $ 3,100,000,000 | ||
Allowance for credit loss | 6,152,378,000 | $ 6,152,378,000 | $ 3,043,468,000 | |
Financing receivable, nonperforming loans, period for classification | 60 days | |||
Total delinquent balance at amortized cost | 2,492,511,000 | $ 2,492,511,000 | 4,554,473,000 | |
ASU 2016-13 | ||||
Financing Receivable, Past Due [Line Items] | ||||
Allowance for credit loss | $ 2,100,000,000 | |||
Commercial Portfolio Segment | ||||
Financing Receivable, Past Due [Line Items] | ||||
Financing receivable, nonperforming loans, period for classification | 90 days | |||
Total delinquent balance at amortized cost | 0 | $ 0 | 0 | |
Consumer Portfolio Segment | ||||
Financing Receivable, Past Due [Line Items] | ||||
Total delinquent balance at amortized cost | 2,491,290,000 | 2,491,290,000 | 4,550,947,000 | |
Financing receivable, recorded investment, 90 days past due and still accruing | $ 64,358,000 | $ 64,358,000 | $ 128,872,000 |
Credit Loss Allowance and Cre_5
Credit Loss Allowance and Credit Quality - Summary of Delinquencies (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Financing Receivable, Past Due [Line Items] | ||
Total delinquent balance at amortized cost | $ 2,492,511 | $ 4,554,473 |
Total delinquent principal, percent | 7.40% | 14.80% |
Accrued interest receivable | $ 428,586 | $ 288,615 |
Financial Asset Acquired with Credit Deterioration | ||
Financing Receivable, Past Due [Line Items] | ||
Total delinquent balance at amortized cost | 1,221 | 3,526 |
Financial Asset Originated and Financial Asset Acquired with Credit Deterioration | ||
Financing Receivable, Past Due [Line Items] | ||
Accrued interest receivable | 64,970 | |
Consumer Portfolio Segment | ||
Financing Receivable, Past Due [Line Items] | ||
Total delinquent balance at amortized cost | 2,491,290 | 4,550,947 |
Accrued interest receivable | 428,000 | |
30-59 days past due | ||
Financing Receivable, Past Due [Line Items] | ||
Total delinquent balance at amortized cost | $ 1,674,600 | $ 2,974,425 |
Total delinquent principal, percent | 5.00% | 9.70% |
30-59 days past due | Financial Asset Acquired with Credit Deterioration | ||
Financing Receivable, Past Due [Line Items] | ||
Total delinquent balance at amortized cost | $ 887 | $ 1,930 |
30-59 days past due | Consumer Portfolio Segment | ||
Financing Receivable, Past Due [Line Items] | ||
Total delinquent balance at amortized cost | 1,673,713 | 2,972,495 |
Over 59 days | ||
Financing Receivable, Past Due [Line Items] | ||
Total delinquent balance at amortized cost | $ 817,911 | $ 1,580,048 |
Total delinquent principal, percent | 2.40% | 5.10% |
Over 59 days | Financial Asset Acquired with Credit Deterioration | ||
Financing Receivable, Past Due [Line Items] | ||
Total delinquent balance at amortized cost | $ 334 | $ 1,596 |
Over 59 days | Consumer Portfolio Segment | ||
Financing Receivable, Past Due [Line Items] | ||
Total delinquent balance at amortized cost | $ 817,577 | $ 1,578,452 |
Credit Loss Allowance and Cre_6
Credit Loss Allowance and Credit Quality - Retail Installment Contracts Held for Investment on Nonaccrual Status (Details) - Consumer Portfolio Segment - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Dec. 31, 2019 | |
Financing Receivable, Troubled Debt Restructuring [Line Items] | ||
Non-accrual loans | $ 925,075 | $ 1,615,581 |
Non-accrual loans with no allowance | 188,225 | |
Interest income recognized on nonaccrual loans (YTD) | $ 84,403 | |
Non-accrual loans as a percent of total amortized cost | 2.80% | 5.30% |
Non-TDR | ||
Financing Receivable, Troubled Debt Restructuring [Line Items] | ||
Non-accrual loans | $ 623,428 | $ 1,099,462 |
Non-accrual loans with no allowance | 141,269 | |
Interest income recognized on nonaccrual loans (YTD) | $ 57,275 | |
Non-accrual loans as a percent of total amortized cost | 1.90% | 3.60% |
TDR | ||
Financing Receivable, Troubled Debt Restructuring [Line Items] | ||
Non-accrual loans | $ 301,647 | $ 516,119 |
Non-accrual loans with no allowance | 46,956 | |
Interest income recognized on nonaccrual loans (YTD) | $ 27,128 | |
Non-accrual loans as a percent of total amortized cost | 0.90% | 1.70% |
Credit Loss Allowance and Cre_7
Credit Loss Allowance and Credit Quality - Credit Risk Profile (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Financing Receivable Recorded Investment [Line Items] | ||
Total Amount | $ 33,602,108 | $ 30,810,487 |
Accrued interest receivable | 428,586 | $ 288,615 |
Consumer Portfolio Segment | ||
Financing Receivable Recorded Investment [Line Items] | ||
2020 | 12,473,000 | |
2019 | 9,831,000 | |
2018 | 5,632,000 | |
2017 | 2,571,000 | |
2016 | 1,621,000 | |
2015 | 1,040,000 | |
Prior | 396,000 | |
Total Amount | $ 33,564,000 | |
Total % | 100.00% | |
Accrued interest receivable | $ 428,000 | |
No FICO | Consumer Portfolio Segment | ||
Financing Receivable Recorded Investment [Line Items] | ||
2020 | 1,395,000 | |
2019 | 1,318,000 | |
2018 | 608,000 | |
2017 | 595,000 | |
2016 | 305,000 | |
2015 | 174,000 | |
Prior | 40,000 | |
Total Amount | $ 4,435,000 | |
Total % | 13.20% | 12.40% |
FICO Band Less than 540 | Consumer Portfolio Segment | ||
Financing Receivable Recorded Investment [Line Items] | ||
2020 | $ 1,444,000 | |
2019 | 1,517,000 | |
2018 | 1,022,000 | |
2017 | 516,000 | |
2016 | 305,000 | |
2015 | 223,000 | |
Prior | 116,000 | |
Total Amount | $ 5,143,000 | |
Total % | 15.30% | 16.90% |
FICO Band 540-599 | Consumer Portfolio Segment | ||
Financing Receivable Recorded Investment [Line Items] | ||
2020 | $ 3,307,000 | |
2019 | 3,345,000 | |
2018 | 1,960,000 | |
2017 | 768,000 | |
2016 | 495,000 | |
2015 | 322,000 | |
Prior | 127,000 | |
Total Amount | $ 10,324,000 | |
Total % | 30.70% | 31.90% |
FICO Band 600-639 | Consumer Portfolio Segment | ||
Financing Receivable Recorded Investment [Line Items] | ||
2020 | $ 2,101,000 | |
2019 | 2,059,000 | |
2018 | 1,120,000 | |
2017 | 384,000 | |
2016 | 272,000 | |
2015 | 158,000 | |
Prior | 65,000 | |
Total Amount | $ 6,159,000 | |
Total % | 18.40% | 19.00% |
FICO Band Greater than 640 | Consumer Portfolio Segment | ||
Financing Receivable Recorded Investment [Line Items] | ||
2020 | $ 4,226,000 | |
2019 | 1,592,000 | |
2018 | 922,000 | |
2017 | 308,000 | |
2016 | 244,000 | |
2015 | 163,000 | |
Prior | 48,000 | |
Total Amount | $ 7,503,000 | |
Total % | 22.40% | 19.80% |
Credit Loss Allowance and Cre_8
Credit Loss Allowance and Credit Quality - Troubled Debt Restructurings, Narrative (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2020 | Dec. 31, 2019 | |
Commercial Portfolio Segment | ||
Financing Receivable, Troubled Debt Restructuring [Line Items] | ||
Total TDR principal | $ 0 | $ 0 |
Consumer Portfolio Segment | ||
Financing Receivable, Troubled Debt Restructuring [Line Items] | ||
Total TDR principal | $ 3,843,470,000 | $ 3,828,892,000 |
Trouble debt restructuring, number of days past due considered subsequently defaulted | 120 days | |
Consumer Portfolio Segment | Unsecured Consumer Loans | ||
Financing Receivable, Troubled Debt Restructuring [Line Items] | ||
Trouble debt restructuring, number of days past due considered subsequently defaulted | 180 days |
Credit Loss Allowance and Cre_9
Credit Loss Allowance and Credit Quality - Summary of TDRs (Details) - Consumer Portfolio Segment - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Financing Receivable, Troubled Debt Restructuring [Line Items] | |||
Outstanding recorded investment | $ 3,843,470 | $ 3,828,892 | |
Impairment | (1,248,522) | (914,718) | |
Amortized cost including accrued interest, net of impairment | 2,594,948 | 2,914,174 | |
Collateral Dependent | |||
Financing Receivable, Troubled Debt Restructuring [Line Items] | |||
Outstanding recorded investment | 74,000 | $ 94,900 | |
TDR write down | $ 27,100 | $ 36,400 |
Credit Loss Allowance and Cr_10
Credit Loss Allowance and Credit Quality - Delinquent TDRs (Details) - Consumer Portfolio Segment - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Troubled Debt Restructuring Debtor Current Period [Line Items] | ||
Total TDR principal | $ 3,843,470 | $ 3,828,892 |
Equal to or greater than 30 days past due | ||
Troubled Debt Restructuring Debtor Current Period [Line Items] | ||
Total TDR principal | 852,127 | 1,449,661 |
30-59 days past due | ||
Troubled Debt Restructuring Debtor Current Period [Line Items] | ||
Total TDR principal | 564,838 | 927,952 |
Over 59 days | ||
Troubled Debt Restructuring Debtor Current Period [Line Items] | ||
Total TDR principal | $ 287,289 | $ 521,709 |
Credit Loss Allowance and Cr_11
Credit Loss Allowance and Credit Quality - Average Recorded Investment and Income Recognized on TDR Loans (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Financing Receivable, Troubled Debt Restructuring [Line Items] | ||||
Interest income recognized | $ 1,300,694 | $ 1,273,022 | $ 3,811,113 | $ 3,787,700 |
Consumer Portfolio Segment | ||||
Financing Receivable, Troubled Debt Restructuring [Line Items] | ||||
Average amortized cost (including accrued interest) | 3,960,119 | 4,399,099 | 3,802,823 | 4,790,378 |
Consumer Portfolio Segment | TDR | ||||
Financing Receivable, Troubled Debt Restructuring [Line Items] | ||||
Interest income recognized | $ 165,637 | $ 188,331 | $ 457,642 | $ 623,324 |
Credit Loss Allowance and Cr_12
Credit Loss Allowance and Credit Quality - Financial Effects of TDRs (Details) - Consumer Portfolio Segment $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020USD ($)contract | Sep. 30, 2019USD ($)contract | Sep. 30, 2020USD ($)contract | Sep. 30, 2019USD ($)contract | |
Financing Receivable, Troubled Debt Restructuring [Line Items] | ||||
Amortized cost (including accrued interest) before TDR | $ 317,455 | $ 376,206 | $ 1,399,813 | $ 1,003,755 |
Amortized cost (including accrued interest) after TDR | $ 319,027 | $ 377,750 | $ 1,417,480 | $ 1,006,637 |
Number of contracts | contract | 14,620,000 | 21,575,000 | 69,786,000 | 58,783,000 |
Credit Loss Allowance and Cr_13
Credit Loss Allowance and Credit Quality - Defaults in Loan Modifications Accounted for as TDRs (Details) - Consumer Portfolio Segment $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020USD ($)contract | Sep. 30, 2019USD ($)contract | Sep. 30, 2020USD ($)contract | Sep. 30, 2019USD ($)contract | |
Financing Receivable, Troubled Debt Restructuring [Line Items] | ||||
Amortized cost (including accrued interest) in TDRs that subsequently defaulted | $ | $ 83,002 | $ 83,254 | $ 183,871 | $ 299,619 |
Number of contracts | contract | 4,379 | 5,190 | 10,467 | 18,097 |
Leases (SC as Lessor) - Summary
Leases (SC as Lessor) - Summary of Leased Vehicles (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Lessor, Lease, Description [Line Items] | ||
Less: accumulated depreciation | $ (99,382) | $ (85,347) |
Leased Vehicles | ||
Lessor, Lease, Description [Line Items] | ||
Leased vehicles | 21,795,939 | 21,722,726 |
Less: accumulated depreciation | (4,694,217) | (4,159,944) |
Depreciated net capitalized cost | 17,101,722 | 17,562,782 |
Manufacturer subvention payments, net of accretion | (972,778) | (1,177,342) |
Origination fees and other costs | 66,432 | 76,542 |
Net book value | $ 16,195,376 | $ 16,461,982 |
Leases (SC as Lessor) - Future
Leases (SC as Lessor) - Future Minimum Rental Payments Due to Lessor under Operating Leases (Details) $ in Thousands | Sep. 30, 2020USD ($) |
Leases [Abstract] | |
Remainder of 2020 | $ 745,650 |
2021 | 2,304,011 |
2022 | 1,218,588 |
2023 | 428,287 |
2024 | 7,852 |
Thereafter | 0 |
Total | $ 4,704,388 |
Leases (SC as Lessor) - Summa_2
Leases (SC as Lessor) - Summary of Finance Lease Receivables (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Leases [Abstract] | ||
Gross investment in finance leases | $ 34,290 | $ 34,443 |
Origination fees and other | 288 | 241 |
Less: unearned income | (7,673) | (6,859) |
Net investment in finance leases before allowance | 26,905 | 27,825 |
Less: allowance for lease losses | (3,718) | (4,740) |
Net investment in finance leases | $ 23,187 | $ 23,085 |
Leases (SC as Lessor) - Futur_2
Leases (SC as Lessor) - Future Minimum Rental Receivable under Finance Leases (Details) $ in Thousands | Sep. 30, 2020USD ($) |
Leases [Abstract] | |
Remainder of 2020 | $ 2,685 |
2021 | 10,066 |
2022 | 8,793 |
2023 | 6,780 |
2024 | 4,262 |
Thereafter | 1,704 |
Total | $ 34,290 |
Other Assets - Summary (Details
Other Assets - Summary (Details) - USD ($) $ in Thousands | 1 Months Ended | 9 Months Ended | |||
Jun. 30, 2019 | May 31, 2013 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Derivative [Line Items] | |||||
Vehicles | $ 370,678 | $ 341,465 | |||
Manufacturer subvention payments receivable | 38,414 | 74,738 | |||
Upfront fee | 76,709 | 98,980 | |||
Derivative - collateral | 104,435 | 147,914 | |||
Operating leases (Right-of-use-assets) | 49,443 | 57,508 | |||
Available-for-sale debt securities | 95,666 | 92,246 | |||
Held-to-maturity debt securities | 50,417 | 0 | |||
Equity securities not held for trading | 1,430 | 0 | |||
Prepaids | 44,458 | 45,644 | |||
Accounts receivable | 34,898 | 24,103 | |||
Federal and State tax receivable | 104,667 | 82,945 | |||
Other | 65,451 | 40,119 | |||
Other assets - $5,878 and $30,841 held at affiliates, respectively | 1,042,665 | 1,071,020 | |||
Upfront fee | $ 60,000 | $ 150,000 | 0 | $ 60,000 | |
Finance and other interest income amortization period | 10 years | ||||
Third Party | |||||
Derivative [Line Items] | |||||
Derivative assets (third party) at fair value | $ 5,999 | $ 65,358 |
Other Assets - Operating Leases
Other Assets - Operating Leases, Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Lessee, Lease, Description [Line Items] | |||||
Lease expense | $ 3,479 | $ 3,402 | $ 10,586 | $ 10,316 | |
Operating cash flows from operating leases | 12,947 | ||||
Equity securities not held for trading | $ 1,430 | $ 1,430 | $ 0 | ||
Minimum | |||||
Lessee, Lease, Description [Line Items] | |||||
Lease renewal term | 1 year | 1 year | |||
Maximum | |||||
Lessee, Lease, Description [Line Items] | |||||
Lease renewal term | 15 years | 15 years |
Other Assets - Supplemental Inf
Other Assets - Supplemental Information Related to Operating Leases (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Other Assets, Leases And Investments [Abstract] | ||
Operating leases-right of use assets | $ 49,443 | $ 57,508 |
Other liabilities | $ 68,545 | |
Weighted average lease term | 5 years 7 months 6 days | |
Weighted average discount rate | 3.40% |
Other Assets - Maturity of Oper
Other Assets - Maturity of Operating Lease Liabilities (Details) $ in Thousands | Sep. 30, 2020USD ($) |
Other Assets, Leases And Investments [Abstract] | |
2020 | $ 4,175 |
2021 | 13,343 |
2022 | 12,639 |
2023 | 12,762 |
2024 | 12,701 |
Thereafter | 19,691 |
Total | 75,311 |
Less: Interest | (6,766) |
Present value of lease liabilities | $ 68,545 |
Other Assets - Amortized Cost,
Other Assets - Amortized Cost, Gross Unrealized Gains and Losses and Fair Values of AFS and HTM Debt Securities (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Available-for-sale debt securities (US Treasury securities) | ||
Amortized cost (before unrealized gains / losses) | $ 92,621 | |
Gross Unrealized gain | 3,045 | |
Gross Unrealized loss | 0 | |
Fair value | 95,666 | $ 92,246 |
Held-to-maturity debt securities (Asset-Backed Notes) | ||
Amortized cost (before unrealized gains / losses) | 50,381 | |
Gross Unrealized gain | 561 | |
Gross Unrealized loss | 0 | |
Fair value | $ 50,942 |
Other Assets - Contractual Matu
Other Assets - Contractual Maturities of AFS and HTM Debt Securities (Details) $ in Thousands | Sep. 30, 2020USD ($) |
Amortized cost | |
Due within one year | $ 4,978 |
Due after one year but within 5 years | 87,643 |
Due after 5 year but within 10 years | 0 |
Total | 92,621 |
Fair value | |
Due within one year | 5,096 |
Due after one year but within 5 years | 90,570 |
Due after 5 year but within 10 years | 0 |
Total | 95,666 |
Amortized cost | |
Due within one year | 3,416 |
Due after one year but within 5 years | 34,178 |
Due after 5 year but within 10 years | 12,787 |
Total | 50,381 |
Fair value | |
Due within one year | 3,416 |
Due after one year but within 5 years | 34,320 |
Due after 5 year but within 10 years | 13,206 |
Fair value | $ 50,942 |
Variable Interest Entities - On
Variable Interest Entities - On-balance Sheet Variable Interest Entities (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 | Sep. 30, 2019 |
Assets | |||
Restricted cash | $ 2,267,154 | $ 2,079,239 | $ 2,245,526 |
Finance receivables held for investment, net | 27,449,730 | 27,767,019 | |
Various other assets | 1,042,665 | 1,071,020 | |
Total assets | 48,448,921 | 48,933,529 | |
Liabilities | |||
Notes payable | 41,369,347 | 39,194,141 | |
Various other liabilities | 364,708 | 389,269 | |
TOTAL LIABILITIES | 43,354,109 | 41,614,909 | |
Leased Vehicles | |||
Assets | |||
Leased vehicles, net | 16,195,376 | 16,461,982 | |
Variable Interest Entity, Primary Beneficiary | |||
Assets | |||
Restricted cash | 1,763,252 | 1,629,870 | |
Finance receivables held for investment, net | 22,711,254 | 26,532,328 | |
Various other assets | 870,229 | 625,359 | |
Total assets | 41,540,111 | 45,249,539 | |
Liabilities | |||
Notes payable | 31,265,215 | 34,249,851 | |
Various other liabilities | 117,997 | 188,093 | |
TOTAL LIABILITIES | 31,383,212 | 34,437,944 | |
Variable Interest Entity, Primary Beneficiary | Leased Vehicles | |||
Assets | |||
Leased vehicles, net | $ 16,195,376 | $ 16,461,982 |
Variable Interest Entities - Ad
Variable Interest Entities - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Mar. 31, 2019 | |
Variable Interest Entity, Primary Beneficiary | |||||
Securitization Financial Asset For Which Transfer Is Accounted As Sale [Line Items] | |||||
Gross retail installment contracts transferred and serviced | $ 27,688,633,000 | $ 27,688,633,000 | $ 27,253,573,000 | ||
VIE, Not Primary Beneficiary | |||||
Securitization Financial Asset For Which Transfer Is Accounted As Sale [Line Items] | |||||
Gross retail installment contracts transferred and serviced | 2,554,564,000 | 2,554,564,000 | $ 2,408,205,000 | ||
Off-balance securitizations loss | $ 13,669,000 | $ 40,553,000 | |||
Cash proceeds received for assets derecognized | $ 0 | $ 0 |
Variable Interest Entities - Su
Variable Interest Entities - Summary of Cash Flows Received from Securitization Trusts (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Variable Interest Entity, Primary Beneficiary | ||||
Variable Interest Entity [Line Items] | ||||
Receivables securitized | $ 5,282,901 | $ 5,498,705 | $ 15,845,707 | $ 15,340,428 |
Net proceeds from new securitizations | 4,662,211 | 4,475,722 | 11,470,857 | 12,232,777 |
Net proceeds from retained bonds | 1,293 | 2,414 | 57,286 | 119,719 |
Cash received for servicing fees | 242,245 | 242,801 | 735,533 | 740,760 |
Net distributions from Trusts | 1,173,276 | 1,018,301 | 2,730,657 | 2,689,735 |
Total cash received from Trusts | 6,079,025 | 5,739,238 | 14,994,333 | 15,782,991 |
VIE, Not Primary Beneficiary | ||||
Variable Interest Entity [Line Items] | ||||
Receivables securitized | 636,301 | 0 | 1,148,587 | 0 |
Net proceeds from new securitizations | 592,455 | 0 | 1,052,541 | 0 |
Cash received for servicing fees | 6,598 | 7,859 | 17,856 | 27,467 |
Total cash received from Trusts | $ 599,053 | $ 7,859 | $ 1,070,397 | $ 27,467 |
Variable Interest Entities - Of
Variable Interest Entities - Off-balance Sheet Variable Interest Entities Portfolio (Details) - VIE, Not Primary Beneficiary - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Variable Interest Entity [Line Items] | ||
Total serviced | $ 2,554,564 | $ 2,408,205 |
Third party SCART serviced securitizations | ||
Variable Interest Entity [Line Items] | ||
Total serviced | 1,032,639 | 0 |
Third party CCAP serviced securitizations | ||
Variable Interest Entity [Line Items] | ||
Total serviced | 103,579 | 259,197 |
Santander | ||
Variable Interest Entity [Line Items] | ||
Total serviced | $ 1,418,346 | $ 2,149,008 |
Debt - Total Borrowings and Oth
Debt - Total Borrowings and Other Debt Obligations (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | ||
Total borrowings and other debt obligations | $ 41,369,347 | $ 39,194,141 |
Secured Structured Financings | ||
Debt Instrument [Line Items] | ||
Notes Payable — Secured Structured Financings | 27,364,089 | 28,141,885 |
Secured Structured Financings | Parent | ||
Debt Instrument [Line Items] | ||
Notes Payable — Secured Structured Financings | 27,356,867 | 28,141,885 |
Secured Structured Financings | Santander | ||
Debt Instrument [Line Items] | ||
Notes Payable — Secured Structured Financings | 7,200 | |
Secured Structured Financings | Santander | Subsidiaries | ||
Debt Instrument [Line Items] | ||
Notes Payable — Secured Structured Financings | 7,222 | 0 |
Facilities with third parties | ||
Debt Instrument [Line Items] | ||
Notes payable | 2,803,684 | 5,399,931 |
Facilities with Santander and related subsidiaries | ||
Debt Instrument [Line Items] | ||
Notes payable | 11,200,000 | 5,650,000 |
Notes Payable - Facilities with Santander and Related Subsidiaries | $ 11,201,574 | $ 5,652,325 |
Debt - Schedule of Credit Facil
Debt - Schedule of Credit Facilities (Details) - USD ($) | Sep. 30, 2020 | Apr. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Total revolving credit facilities | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | $ 14,003,684,000 | $ 11,049,931,000 | ||
Committed Amount | 26,261,896,000 | 21,022,262,000 | ||
Assets Pledged | 5,525,220,000 | 8,339,059,000 | ||
Restricted Cash Pledged | 1,685,000 | 2,346,000 | ||
Facilities with third parties | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 2,803,684,000 | 5,399,931,000 | ||
Committed Amount | 12,061,896,000 | 11,872,262,000 | ||
Assets Pledged | 5,525,220,000 | 8,339,059,000 | ||
Restricted Cash Pledged | 1,685,000 | 2,346,000 | ||
Warehouse line, due August 2022 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 166,000,000 | |||
Committed Amount | $ 500,000,000 | |||
Effective Rate | 2.54% | |||
Assets Pledged | $ 267,776,000 | |||
Restricted Cash Pledged | 0 | |||
Warehouse line, due June 2021 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 471,284,000 | |||
Committed Amount | $ 500,000,000 | |||
Effective Rate | 3.32% | |||
Assets Pledged | $ 675,426,000 | |||
Restricted Cash Pledged | 0 | |||
Warehouse line, due March 2021 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 500,445,000 | 516,045,000 | ||
Committed Amount | $ 1,250,000,000 | $ 1,250,000,000 | ||
Effective Rate | 1.27% | 3.10% | ||
Assets Pledged | $ 1,151,745,000 | $ 734,640,000 | ||
Restricted Cash Pledged | 1,000 | 1,000 | ||
Warehouse line, due October 2021 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 92,800,000 | 1,098,443,000 | ||
Committed Amount | $ 1,500,000,000 | $ 5,000,000,000 | ||
Effective Rate | 2.69% | 4.43% | ||
Assets Pledged | $ 819,518,000 | $ 1,898,365,000 | ||
Restricted Cash Pledged | 0 | 1,756,000 | ||
Line of credit facility, reduction in borrowing capacity | $ 500,000,000 | |||
Warehouse line, due October 2021 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 1,165,943,000 | |||
Committed Amount | $ 3,500,000,000 | $ 1,000,000,000 | ||
Effective Rate | 3.27% | |||
Assets Pledged | $ 1,272,926,000 | |||
Restricted Cash Pledged | 0 | |||
Line of credit facility, additional borrowing capacity | $ 500,000,000 | |||
Warehouse line, due July 2021 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 0 | 500,000,000 | ||
Committed Amount | $ 500,000,000 | $ 500,000,000 | ||
Effective Rate | 1.53% | 3.64% | ||
Assets Pledged | $ 497,994,000 | $ 761,690,000 | ||
Restricted Cash Pledged | 0 | 302,000 | ||
Warehouse line, due October 2021 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 0 | 896,077,000 | ||
Committed Amount | $ 2,100,000,000 | $ 2,100,000,000 | ||
Effective Rate | 4.18% | 3.44% | ||
Assets Pledged | $ 0 | $ 1,748,325,000 | ||
Restricted Cash Pledged | 0 | 7,000 | ||
Repurchase facility, due January 2020 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 273,655,000 | |||
Committed Amount | $ 273,655,000 | |||
Effective Rate | 3.80% | |||
Assets Pledged | $ 377,550,000 | |||
Restricted Cash Pledged | 0 | |||
Warehouse line, due January 2022 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 400,000,000 | |||
Committed Amount | $ 1,000,000,000 | |||
Effective Rate | 1.43% | |||
Assets Pledged | $ 572,755,000 | |||
Restricted Cash Pledged | 0 | |||
Repurchase facility, due March 2020 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 100,756,000 | |||
Committed Amount | $ 100,756,000 | |||
Effective Rate | 3.04% | |||
Assets Pledged | $ 151,710,000 | |||
Restricted Cash Pledged | 0 | |||
Warehouse line, due November 2021 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 166,600,000 | |||
Committed Amount | $ 500,000,000 | |||
Effective Rate | 1.04% | |||
Assets Pledged | $ 495,011,000 | |||
Restricted Cash Pledged | 0 | |||
Repurchase facility, due March 2020 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 47,851,000 | |||
Committed Amount | $ 47,851,000 | |||
Effective Rate | 3.15% | |||
Assets Pledged | $ 69,945,000 | |||
Restricted Cash Pledged | 0 | |||
Warehouse line, due July 2022 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 0 | |||
Committed Amount | $ 900,000,000 | |||
Effective Rate | 3.10% | |||
Assets Pledged | $ 0 | |||
Restricted Cash Pledged | 1,684,000 | |||
Warehouse line, due November 2020 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 970,600,000 | |||
Committed Amount | $ 1,000,000,000 | |||
Effective Rate | 2.57% | |||
Assets Pledged | $ 1,353,305,000 | |||
Restricted Cash Pledged | 0 | |||
Repurchase facility, due January 2021 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 263,272,000 | |||
Committed Amount | $ 263,272,000 | |||
Effective Rate | 1.66% | |||
Assets Pledged | $ 377,550,000 | |||
Restricted Cash Pledged | 0 | |||
Warehouse line, due November 2020 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 471,320,000 | |||
Committed Amount | $ 500,000,000 | |||
Effective Rate | 2.69% | |||
Assets Pledged | $ 505,502,000 | |||
Restricted Cash Pledged | 186,000 | |||
Repurchase facility, due November 2020 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 48,624,000 | |||
Committed Amount | $ 48,624,000 | |||
Effective Rate | 1.79% | |||
Assets Pledged | $ 69,945,000 | |||
Restricted Cash Pledged | 0 | |||
Warehouse line, due June 2021 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 53,900,000 | |||
Committed Amount | $ 600,000,000 | |||
Effective Rate | 7.02% | |||
Assets Pledged | $ 62,601,000 | |||
Restricted Cash Pledged | 94,000 | |||
Facilities with Santander and related subsidiaries | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 11,200,000,000 | 5,650,000,000 | ||
Committed Amount | 14,200,000,000 | 9,150,000,000 | ||
Assets Pledged | 0 | 0 | ||
Restricted Cash Pledged | 0 | 0 | ||
Promissory Note, due December 2021 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 250,000,000 | 250,000,000 | ||
Committed Amount | $ 250,000,000 | $ 250,000,000 | ||
Effective Rate | 3.70% | 3.70% | ||
Assets Pledged | $ 0 | $ 0 | ||
Restricted Cash Pledged | 0 | 0 | ||
Promissory Note, due December 2022 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 250,000,000 | 250,000,000 | ||
Committed Amount | $ 250,000,000 | $ 250,000,000 | ||
Effective Rate | 3.95% | 3.95% | ||
Assets Pledged | $ 0 | $ 0 | ||
Restricted Cash Pledged | 0 | 0 | ||
Promissory Note, due December 2023 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 250,000,000 | 250,000,000 | ||
Committed Amount | $ 250,000,000 | $ 250,000,000 | ||
Effective Rate | 5.25% | 5.25% | ||
Assets Pledged | $ 0 | $ 0 | ||
Restricted Cash Pledged | 0 | 0 | ||
Promissory Note, due December 2022 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 250,000,000 | 250,000,000 | ||
Committed Amount | $ 250,000,000 | $ 250,000,000 | ||
Effective Rate | 5.00% | 5.00% | ||
Assets Pledged | $ 0 | $ 0 | ||
Restricted Cash Pledged | 0 | 0 | ||
Promissory Note, due May 2021 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 250,000,000 | |||
Committed Amount | $ 250,000,000 | |||
Effective Rate | 2.25% | |||
Assets Pledged | $ 0 | |||
Restricted Cash Pledged | 0 | |||
Promissory Note, due March 2021 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 300,000,000 | 300,000,000 | ||
Committed Amount | $ 300,000,000 | $ 300,000,000 | ||
Effective Rate | 3.95% | 3.95% | ||
Assets Pledged | $ 0 | $ 0 | ||
Restricted Cash Pledged | 0 | 0 | ||
Promissory Note, due May 2023 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 350,000,000 | |||
Committed Amount | $ 350,000,000 | |||
Effective Rate | 3.80% | |||
Assets Pledged | $ 0 | |||
Restricted Cash Pledged | 0 | |||
Promissory Note, due October 2020 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 400,000,000 | 400,000,000 | ||
Committed Amount | $ 400,000,000 | $ 400,000,000 | ||
Effective Rate | 4.03% | 3.10% | ||
Assets Pledged | $ 0 | $ 0 | ||
Restricted Cash Pledged | 0 | 0 | ||
Promissory Note, due November 2022 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 400,000,000 | 400,000,000 | ||
Committed Amount | $ 400,000,000 | $ 400,000,000 | ||
Effective Rate | 3.00% | 3.00% | ||
Assets Pledged | $ 0 | $ 0 | ||
Restricted Cash Pledged | 0 | 0 | ||
Promissory Note, due April 2023 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 450,000,000 | |||
Committed Amount | $ 450,000,000 | |||
Effective Rate | 6.13% | |||
Assets Pledged | $ 0 | |||
Restricted Cash Pledged | 0 | |||
Promissory Note, due May 2020 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 500,000,000 | |||
Committed Amount | $ 500,000,000 | |||
Effective Rate | 3.49% | |||
Assets Pledged | $ 0 | |||
Restricted Cash Pledged | 0 | |||
Promissory Note, due June 2022 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 500,000,000 | 500,000,000 | ||
Committed Amount | $ 500,000,000 | $ 500,000,000 | ||
Effective Rate | 3.30% | 3.30% | ||
Assets Pledged | $ 0 | $ 0 | ||
Restricted Cash Pledged | 0 | 0 | ||
Promissory Note due July 2024 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 500,000,000 | 500,000,000 | ||
Committed Amount | $ 500,000,000 | $ 500,000,000 | ||
Effective Rate | 3.90% | 3.90% | ||
Assets Pledged | $ 0 | $ 0 | ||
Restricted Cash Pledged | 0 | 0 | ||
Promissory Note, due March 2022 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 650,000,000 | 650,000,000 | ||
Committed Amount | $ 650,000,000 | $ 650,000,000 | ||
Effective Rate | 4.20% | 4.20% | ||
Assets Pledged | $ 0 | $ 0 | ||
Restricted Cash Pledged | 0 | 0 | ||
Promissory Note, due August 2021 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 650,000,000 | 650,000,000 | ||
Committed Amount | $ 650,000,000 | $ 650,000,000 | ||
Effective Rate | 3.44% | 3.44% | ||
Assets Pledged | $ 0 | $ 0 | ||
Restricted Cash Pledged | 0 | 0 | ||
Promissory Note due September 2023 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 750,000,000 | 750,000,000 | ||
Committed Amount | $ 750,000,000 | $ 750,000,000 | ||
Effective Rate | 3.38% | 3.27% | ||
Assets Pledged | $ 0 | $ 0 | ||
Restricted Cash Pledged | 0 | 0 | ||
Promissory Note due June 2025 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 1,000,000,000 | |||
Committed Amount | $ 1,000,000,000 | |||
Effective Rate | 3.99% | |||
Assets Pledged | $ 0 | |||
Restricted Cash Pledged | 0 | |||
Promissory Note, due June 2022 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 2,000,000,000 | |||
Committed Amount | $ 2,000,000,000 | |||
Effective Rate | 1.40% | |||
Assets Pledged | $ 0 | |||
Restricted Cash Pledged | 0 | |||
Promissory Note, due September 2022 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 2,000,000,000 | |||
Committed Amount | $ 2,000,000,000 | |||
Effective Rate | 1.04% | |||
Assets Pledged | $ 0 | |||
Restricted Cash Pledged | 0 | |||
Line of credit, due July 2021 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 0 | 0 | ||
Committed Amount | $ 500,000,000 | $ 500,000,000 | ||
Effective Rate | 2.18% | 3.86% | ||
Assets Pledged | $ 0 | $ 0 | ||
Restricted Cash Pledged | 0 | 0 | ||
Line of credit, due March 2022 | ||||
Line of Credit Facility [Line Items] | ||||
Utilized Balance | 0 | 0 | ||
Committed Amount | $ 2,500,000,000 | $ 3,000,000,000 | ||
Effective Rate | 3.35% | 4.96% | ||
Assets Pledged | $ 0 | $ 0 | ||
Restricted Cash Pledged | $ 0 | $ 0 |
Debt - Facilities with Santande
Debt - Facilities with Santander and Related Subsidiaries, Narrative (Details) | Sep. 30, 2020USD ($) |
Revolving credit facilities | Facilities with Santander and related subsidiaries | |
Line of Credit Facility [Line Items] | |
Committed amount | $ 3,000,000,000 |
Unsecured debt | Facilities with Santander and related subsidiaries | |
Line of Credit Facility [Line Items] | |
Committed amount | 7,200,000,000 |
Unsecured debt | Facilities with Santander | |
Line of Credit Facility [Line Items] | |
Committed amount | $ 4,000,000,000 |
Debt - Summary of Secured Struc
Debt - Summary of Secured Structured Financings (Details) - Secured Structured Financings - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | ||
Balance | $ 27,364,089 | $ 28,141,885 |
Initial Note Amounts Issued | 55,494,918 | 54,379,783 |
Collateral | 36,778,419 | 36,745,375 |
Restricted Cash | 1,761,567 | 1,627,524 |
Santander | ||
Debt Instrument [Line Items] | ||
Balance | 7,200 | |
Public securitizations | ||
Debt Instrument [Line Items] | ||
Balance | 18,809,455 | 18,807,773 |
Initial Note Amounts Issued | 44,397,355 | 43,982,220 |
Collateral | 24,283,300 | 24,697,158 |
Restricted Cash | 1,737,179 | 1,606,646 |
2015 Securitizations | ||
Debt Instrument [Line Items] | ||
Balance | 334,916 | |
Initial Note Amounts Issued | 3,258,300 | |
Collateral | 411,310 | |
Restricted Cash | $ 94,382 | |
2015 Securitizations | Minimum | ||
Debt Instrument [Line Items] | ||
Initial Weighted Average Interest Rate | 1.67% | |
2015 Securitizations | Maximum | ||
Debt Instrument [Line Items] | ||
Initial Weighted Average Interest Rate | 2.29% | |
2016 Securitizations | ||
Debt Instrument [Line Items] | ||
Balance | 520,566 | $ 1,144,421 |
Initial Note Amounts Issued | 4,878,390 | 7,462,790 |
Collateral | 710,108 | 1,560,133 |
Restricted Cash | $ 165,372 | $ 248,784 |
2016 Securitizations | Minimum | ||
Debt Instrument [Line Items] | ||
Initial Weighted Average Interest Rate | 1.63% | 1.63% |
2016 Securitizations | Maximum | ||
Debt Instrument [Line Items] | ||
Initial Weighted Average Interest Rate | 2.46% | 2.80% |
2017 Securitizations | ||
Debt Instrument [Line Items] | ||
Balance | $ 1,252,708 | $ 2,364,177 |
Initial Note Amounts Issued | 8,262,940 | 9,296,570 |
Collateral | 1,921,996 | 3,423,303 |
Restricted Cash | $ 228,862 | $ 292,601 |
2017 Securitizations | Minimum | ||
Debt Instrument [Line Items] | ||
Initial Weighted Average Interest Rate | 1.35% | 1.35% |
2017 Securitizations | Maximum | ||
Debt Instrument [Line Items] | ||
Initial Weighted Average Interest Rate | 2.52% | 2.52% |
2018 Securitizations | ||
Debt Instrument [Line Items] | ||
Balance | $ 3,297,883 | $ 5,376,231 |
Initial Note Amounts Issued | 12,039,840 | 12,039,840 |
Collateral | 4,853,413 | 7,240,151 |
Restricted Cash | $ 417,727 | $ 466,069 |
2018 Securitizations | Minimum | ||
Debt Instrument [Line Items] | ||
Initial Weighted Average Interest Rate | 2.41% | 2.41% |
2018 Securitizations | Maximum | ||
Debt Instrument [Line Items] | ||
Initial Weighted Average Interest Rate | 3.42% | 3.42% |
2019 Securitizations (e) | ||
Debt Instrument [Line Items] | ||
Balance | $ 7,365,406 | $ 9,588,028 |
Initial Note Amounts Issued | 11,924,720 | 11,924,720 |
Collateral | 8,999,694 | 12,062,261 |
Restricted Cash | $ 503,999 | $ 504,810 |
2019 Securitizations (e) | Minimum | ||
Debt Instrument [Line Items] | ||
Initial Weighted Average Interest Rate | 2.08% | 2.08% |
2019 Securitizations (e) | Maximum | ||
Debt Instrument [Line Items] | ||
Initial Weighted Average Interest Rate | 3.34% | 3.34% |
2020 Securitizations (e) | ||
Debt Instrument [Line Items] | ||
Balance | $ 6,372,892 | |
Initial Note Amounts Issued | 7,291,465 | |
Collateral | 7,798,089 | |
Restricted Cash | $ 421,219 | |
2020 Securitizations (e) | Minimum | ||
Debt Instrument [Line Items] | ||
Initial Weighted Average Interest Rate | 0.76% | |
2020 Securitizations (e) | Maximum | ||
Debt Instrument [Line Items] | ||
Initial Weighted Average Interest Rate | 2.73% | |
Privately issued amortizing notes | ||
Debt Instrument [Line Items] | ||
Balance | $ 8,554,634 | $ 9,334,112 |
Initial Note Amounts Issued | 11,097,563 | 10,397,563 |
Collateral | 12,495,119 | 12,048,217 |
Restricted Cash | 24,388 | 20,878 |
2013 Private issuances | ||
Debt Instrument [Line Items] | ||
Balance | 1,106,654 | 2,252,616 |
Initial Note Amounts Issued | $ 1,537,025 | $ 1,537,025 |
Initial Weighted Average Interest Rate | 1.28% | 1.28% |
Collateral | $ 2,189,789 | $ 2,143,065 |
Restricted Cash | 751 | 303 |
2015 Private issuances | ||
Debt Instrument [Line Items] | ||
Balance | 19,029 | |
Initial Note Amounts Issued | $ 500,000 | |
Initial Weighted Average Interest Rate | 1.05% | |
Collateral | $ 67,007 | |
Restricted Cash | 113 | |
2018 Private issuances | ||
Debt Instrument [Line Items] | ||
Balance | 3,329,885 | 30,943 |
Initial Note Amounts Issued | 4,536,002 | $ 300,000 |
Initial Weighted Average Interest Rate | 2.35% | |
Collateral | 5,028,329 | $ 90,352 |
Restricted Cash | $ 8,294 | 0 |
2018 Private issuances | Minimum | ||
Debt Instrument [Line Items] | ||
Initial Weighted Average Interest Rate | 2.42% | |
2018 Private issuances | Maximum | ||
Debt Instrument [Line Items] | ||
Initial Weighted Average Interest Rate | 3.53% | |
2018 Private issuance | ||
Debt Instrument [Line Items] | ||
Balance | 3,742,509 | |
Initial Note Amounts Issued | 4,536,002 | |
Collateral | 5,292,020 | |
Restricted Cash | $ 10,114 | |
2018 Private issuance | Minimum | ||
Debt Instrument [Line Items] | ||
Initial Weighted Average Interest Rate | 2.42% | |
2018 Private issuance | Maximum | ||
Debt Instrument [Line Items] | ||
Initial Weighted Average Interest Rate | 3.53% | |
2019 Private issuance | ||
Debt Instrument [Line Items] | ||
Balance | $ 2,839,895 | $ 3,289,015 |
Initial Note Amounts Issued | 3,524,536 | 3,524,536 |
Collateral | 3,743,384 | 4,455,773 |
Restricted Cash | $ 10,441 | $ 10,348 |
2019 Private issuance | Minimum | ||
Debt Instrument [Line Items] | ||
Initial Weighted Average Interest Rate | 2.45% | 2.45% |
2019 Private issuance | Maximum | ||
Debt Instrument [Line Items] | ||
Initial Weighted Average Interest Rate | 3.90% | 3.90% |
2020 Private issuance | ||
Debt Instrument [Line Items] | ||
Balance | $ 1,278,200 | |
Initial Note Amounts Issued | $ 1,500,000 | |
Initial Weighted Average Interest Rate | 1.29% | |
Collateral | $ 1,533,617 | |
Restricted Cash | $ 4,902 | |
2020 Private issuance | Maximum | ||
Debt Instrument [Line Items] | ||
Initial Weighted Average Interest Rate | 2.68% |
Debt - Secured Structured Finan
Debt - Secured Structured Financings, Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |||||
Private issuance notes secured with vehicle lease | $ 10,000,000 | $ 10,000,000 | $ 10,200,000 | ||
Amortized debt issuance costs | 10,265 | $ 11,591 | 28,301 | $ 29,361 | |
Interest expense on secured structured financing | $ 150,734 | $ 217,544 | $ 522,266 | $ 671,770 |
Shareholders' Equity - Addition
Shareholders' Equity - Additional Information (Details) - USD ($) | 3 Months Ended | ||
Sep. 30, 2020 | Dec. 31, 2019 | Jun. 30, 2019 | |
Equity [Abstract] | |||
Share repurchase program, authorized amount | $ 1,100,000,000 | ||
Number of shares withheld to cover income taxes related to vesting of RSUs (in shares) | 57,067,635 | 23,596,367 | |
Treasury stock value | $ 1,301,864,000 | $ 525,897,000 | |
Number of shares withheld for income tax (in shares) | 0 |
Shareholders' Equity - Tender O
Shareholders' Equity - Tender Offer and Other Share Repurchase Programs (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Equity, Class of Treasury Stock [Line Items] | ||||
Number of shares purchased (in shares) | 10,198,800 | 5,479,650 | 33,471,268 | 10,194,772 |
Average price per share (in dollars per share) | $ 21.91 | $ 25.71 | $ 23.14 | $ 24.08 |
Cost of share purchased | $ 223,485 | $ 140,909 | $ 774,457 | $ 245,496 |
Tender Offer | ||||
Equity, Class of Treasury Stock [Line Items] | ||||
Number of shares purchased (in shares) | 0 | 0 | 17,514,707 | 0 |
Average price per share (in dollars per share) | $ 0 | $ 0 | $ 26 | $ 0 |
Cost of share purchased | $ 0 | $ 0 | $ 455,382 | $ 0 |
Other Share Repurchases | ||||
Equity, Class of Treasury Stock [Line Items] | ||||
Number of shares purchased (in shares) | 10,198,800 | 5,479,650 | 15,956,561 | 10,194,772 |
Average price per share (in dollars per share) | $ 21.91 | $ 25.71 | $ 20 | $ 24.08 |
Cost of share purchased | $ 223,485 | $ 140,909 | $ 319,075 | $ 245,496 |
Shareholders' Equity - Summary
Shareholders' Equity - Summary of Changes in Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | $ 4,895,465 | $ 7,337,261 | $ 7,318,620 | $ 7,018,358 |
Other comprehensive income (loss) before reclassifications (gross) | 94 | (5,018) | (43,212) | (38,696) |
Amounts (gross) reclassified out of accumulated other comprehensive income (loss) | 6,729 | (6,251) | 13,023 | (26,655) |
Ending balance | 5,094,812 | 7,345,202 | 5,094,812 | 7,345,202 |
Accumulated Other Comprehensive Income (Loss) | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | (63,705) | (20,567) | (26,693) | 33,515 |
Ending balance | $ (56,882) | $ (31,836) | $ (56,882) | $ (31,836) |
Shareholders' Equity - Reclassi
Shareholders' Equity - Reclassification of Amounts Out of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income On Derivatives [Line Items] | ||||
Interest expense | $ 292,118 | $ 335,212 | $ 929,934 | $ 999,633 |
Investment gain/loss | (68,989) | (86,397) | (279,997) | (238,281) |
Income tax expense | (172,476) | (82,156) | (137,161) | (283,684) |
Net income (loss) | 490,115 | 232,538 | 389,450 | 848,308 |
Reclassification out of Accumulated Other Comprehensive Income | ||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income On Derivatives [Line Items] | ||||
Net income (loss) | 6,729 | (6,251) | 13,023 | (26,655) |
Reclassification out of Accumulated Other Comprehensive Income | Unrealized Gains (Losses) on Cash Flow Hedges | ||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income On Derivatives [Line Items] | ||||
Interest expense | 8,939 | (8,283) | 17,260 | (35,224) |
Income tax expense | (2,210) | 2,032 | (4,237) | 8,569 |
Reclassification out of Accumulated Other Comprehensive Income | AOCI, Accumulated Gain (Loss), Debt Securities, Available-for-sale, Parent | ||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income On Derivatives [Line Items] | ||||
Investment gain/loss | $ 0 | $ 0 | $ 0 | $ 0 |
Shareholders' Equity - Dividend
Shareholders' Equity - Dividends (Details) - $ / shares | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||
Aug. 31, 2020 | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Equity [Abstract] | |||||
Dividend paid per common share (in dollars per share) | $ 0.22 | ||||
Dividends declared per common share (in dollars per share) | $ 0.22 | $ 0.22 | $ 0.66 | $ 0.62 |
Derivative Financial Instrume_3
Derivative Financial Instruments - Summary of Underlying Notional Amounts and Aggregate Fair Values (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Derivative [Line Items] | ||
Asset | $ 5,999 | $ 65,359 |
Liability | (99,742) | (111,947) |
Interest rate swaps | Not Designated As Hedges | ||
Derivative [Line Items] | ||
Notional | 250,000 | 1,281,000 |
Asset | 0 | 0 |
Liability | (14,393) | (10,267) |
Interest rate swaps | Cash Flow Hedging | Designated as Hedges | ||
Derivative [Line Items] | ||
Notional | 2,750,000 | 2,650,000 |
Asset | 0 | 2,807 |
Liability | (79,350) | (39,128) |
Interest rate cap agreements | ||
Derivative [Line Items] | ||
Notional | 11,117,779 | 9,379,720 |
Asset | 5,999 | 62,552 |
Liability | 0 | 0 |
Options for interest rate cap agreements | ||
Derivative [Line Items] | ||
Notional | 11,117,779 | 9,379,720 |
Asset | 0 | 0 |
Liability | $ (5,999) | $ (62,552) |
Derivative Financial Instrume_4
Derivative Financial Instruments - Offsetting of Derivative Assets and Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Gross Amounts Not Offset in the condensed Consolidated Balance Sheet | ||
Assets Presented in the condensed Consolidated Balance Sheet | $ 5,999 | $ 65,359 |
Total derivatives not subject to a master netting arrangement or similar arrangement | 0 | 0 |
Total derivative assets | 5,999 | 65,359 |
Total financial assets | 5,999 | 65,359 |
Collateral Received | (5,184) | (41,669) |
Collateral Received, Total financial assets | (5,184) | (41,669) |
Net Amount | 815 | 23,690 |
Net Amount, Total derivative assets | 815 | 23,690 |
Net Amount, Total financial assets | 815 | 23,690 |
Gross Amounts Not Offset in the condensed Consolidated Balance Sheet | ||
Liabilities Presented in the condensed Consolidated Balance Sheet | 99,742 | 111,947 |
Total derivatives not subject to a master netting arrangement or similar arrangement | 0 | 0 |
Total derivative liabilities | 99,742 | 111,947 |
Total financial liabilities | 99,742 | 111,947 |
Collateral Pledged | (98,751) | (111,947) |
Collateral Pledged, Total financial liabilities | (98,751) | (111,947) |
Net Amount | 991 | 0 |
Net Amount, Total derivative liabilities | 991 | 0 |
Net Amount, Total financial liabilities | 991 | 0 |
Interest rate swaps | Third Party | ||
Gross Amounts Not Offset in the condensed Consolidated Balance Sheet | ||
Assets Presented in the condensed Consolidated Balance Sheet | 2,807 | |
Collateral Received | (540) | |
Net Amount | 2,267 | |
Gross Amounts Not Offset in the condensed Consolidated Balance Sheet | ||
Liabilities Presented in the condensed Consolidated Balance Sheet | 93,743 | 49,395 |
Collateral Pledged | (93,743) | (49,395) |
Net Amount | 0 | 0 |
Interest rate caps | ||
Gross Amounts Not Offset in the condensed Consolidated Balance Sheet | ||
Total derivative assets | 5,999 | 62,552 |
Gross Amounts Not Offset in the condensed Consolidated Balance Sheet | ||
Total derivative liabilities | 0 | 0 |
Interest rate caps | Third Party | ||
Gross Amounts Not Offset in the condensed Consolidated Balance Sheet | ||
Assets Presented in the condensed Consolidated Balance Sheet | 5,184 | 37,222 |
Collateral Received | (5,184) | (26,199) |
Net Amount | 0 | 11,023 |
Gross Amounts Not Offset in the condensed Consolidated Balance Sheet | ||
Liabilities Presented in the condensed Consolidated Balance Sheet | 5,184 | 37,222 |
Collateral Pledged | (4,193) | (37,222) |
Net Amount | 991 | 0 |
Interest rate caps | Santander and Affiliates | ||
Gross Amounts Not Offset in the condensed Consolidated Balance Sheet | ||
Assets Presented in the condensed Consolidated Balance Sheet | 815 | 25,330 |
Collateral Received | 0 | (14,930) |
Net Amount | 815 | 10,400 |
Gross Amounts Not Offset in the condensed Consolidated Balance Sheet | ||
Liabilities Presented in the condensed Consolidated Balance Sheet | 815 | 25,330 |
Collateral Pledged | (815) | (25,330) |
Net Amount | $ 0 | $ 0 |
Derivative Financial Instrume_5
Derivative Financial Instruments - Gross Gains (Losses) Reclassified from Accumulated Other Comprehensive Income (Details) - Interest Rate Swaps - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Designated as Hedges | ||||
Derivative Instruments Gain Loss [Line Items] | ||||
Recognized in Earnings | $ 0 | $ 0 | $ 0 | $ 0 |
Gross Gains (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) | 256 | (6,485) | (59,405) | (52,292) |
Gross amount Reclassified From Accumulated Other Comprehensive Income to Interest Expense | (8,939) | 8,283 | (17,260) | 35,224 |
Not Designated As Hedges | Interest Expense | ||||
Derivative Instruments Gain Loss [Line Items] | ||||
Recognized in Earnings | $ 567 | $ 903 | $ 10,774 | $ 14,750 |
Derivative Financial Instrume_6
Derivative Financial Instruments - Additional Information (Details) $ in Millions | Sep. 30, 2020USD ($) |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Estimated unrealized loss to be reclassified from AOCI to interest expense in next 12 months | $ 31,118 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other assets — available-for-sale-debt securities | $ 95,666 | $ 92,246 |
Recurring | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other assets — available-for-sale-debt securities | 95,666 | 92,246 |
Retail installment contracts, non-accrual status | 8,248 | 22,353 |
Retail installment contracts, non-accrual status | 2,031 | 9,511 |
Recurring | Interest Rate Caps | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other assets — derivative instruments | 5,999 | 62,552 |
Recurring | Interest Rate Swaps | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other liabilities | 14,393 | 10,267 |
Recurring | Interest Rate Swaps | Cash Flow Hedging | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other assets — derivative instruments | 0 | 2,807 |
Other liabilities | 79,350 | 39,128 |
Recurring | Trading Options for Interest Rate Caps | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other liabilities | 5,999 | 62,552 |
Recurring | Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other assets — available-for-sale-debt securities | 0 | 0 |
Retail installment contracts, non-accrual status | 0 | 0 |
Recurring | Level 1 | Interest Rate Caps | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other assets — derivative instruments | 0 | 0 |
Recurring | Level 1 | Interest Rate Swaps | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other liabilities | 0 | 0 |
Recurring | Level 1 | Interest Rate Swaps | Cash Flow Hedging | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other assets — derivative instruments | 0 | 0 |
Other liabilities | 0 | 0 |
Recurring | Level 1 | Trading Options for Interest Rate Caps | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other liabilities | 0 | 0 |
Recurring | Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other assets — available-for-sale-debt securities | 95,666 | 92,246 |
Retail installment contracts, non-accrual status | 0 | 17,634 |
Recurring | Level 2 | Interest Rate Caps | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other assets — derivative instruments | 5,999 | 62,552 |
Recurring | Level 2 | Interest Rate Swaps | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other liabilities | 14,393 | 10,267 |
Recurring | Level 2 | Interest Rate Swaps | Cash Flow Hedging | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other assets — derivative instruments | 0 | 2,807 |
Other liabilities | 79,350 | 39,128 |
Recurring | Level 2 | Trading Options for Interest Rate Caps | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other liabilities | 5,999 | 62,552 |
Recurring | Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other assets — available-for-sale-debt securities | 0 | 0 |
Retail installment contracts, non-accrual status | 4,719 | |
Recurring | Level 3 | Interest Rate Caps | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other assets — derivative instruments | 0 | 0 |
Recurring | Level 3 | Interest Rate Swaps | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other liabilities | 0 | 0 |
Recurring | Level 3 | Interest Rate Swaps | Cash Flow Hedging | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other assets — derivative instruments | 0 | 0 |
Other liabilities | 0 | 0 |
Recurring | Level 3 | Trading Options for Interest Rate Caps | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other liabilities | $ 0 | $ 0 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - Change in Level 3 Balances (Details) - Loans Receivable - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Balance — beginning of year | $ 10,585 | $ 8,832 | $ 4,719 | $ 13,509 |
Additions / issuances | 0 | 0 | 2,512 | 2,079 |
Transfers from level 2 | 0 | 0 | 17,634 | 0 |
Net collection activities | (2,410) | (3,176) | (16,854) | (10,242) |
Gains recognized in earnings | 73 | 632 | 237 | 942 |
Balance — end of year | $ 8,248 | $ 6,288 | $ 8,248 | $ 6,288 |
Fair Value of Financial Instr_5
Fair Value of Financial Instruments - Assets and Liabilities Measured at Fair Value on Nonrecurring Basis (Details) - Nonrecurring - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Dec. 31, 2019 | |
Vehicles | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Assets, fair value | $ 370,678 | $ 341,465 |
Lower of cost or fair value expense | 0 | 0 |
Personal loans held for sale (b) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Personal loans held for sale | 763,292 | 1,007,105 |
Lower of cost or fair value expense | 241,198 | 408,700 |
Auto loans impaired due to bankruptcy | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Assets, fair value | 188,226 | 200,504 |
Lower of cost or fair value expense | $ 0 | $ 9,106 |
Fair Value of Financial Instr_6
Fair Value of Financial Instruments - Quantitative Information for Assets and Liabilities (Details) $ in Thousands | Sep. 30, 2020USD ($) | Dec. 31, 2019USD ($) |
Recurring | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Retail installment contracts, non-accrual status | $ 8,248 | $ 22,353 |
Level 3 | Recurring | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Retail installment contracts, non-accrual status | $ 4,719 | |
Retail installment contracts held for investment | Level 3 | Recurring | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Retail installment contracts, non-accrual status | $ 8,248 | |
Retail installment contracts held for investment | Level 3 | Discounted Cash Flow | Discount Rate | Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Retail installment contracts held for investment | 0.08 | 0.08 |
Retail installment contracts held for investment | Level 3 | Discounted Cash Flow | Discount Rate | Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Retail installment contracts held for investment | 0.14 | 0.10 |
Retail installment contracts held for investment | Level 3 | Discounted Cash Flow | Discount Rate | Weighted Average | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Retail installment contracts held for investment | 0.09 | |
Retail installment contracts held for investment | Level 3 | Discounted Cash Flow | Default Rate | Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Retail installment contracts held for investment | 0.04 | 0.15 |
Retail installment contracts held for investment | Level 3 | Discounted Cash Flow | Default Rate | Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Retail installment contracts held for investment | 0.20 | 0.20 |
Retail installment contracts held for investment | Level 3 | Discounted Cash Flow | Default Rate | Weighted Average | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Retail installment contracts held for investment | 0.05 | |
Retail installment contracts held for investment | Level 3 | Discounted Cash Flow | Prepayment Rate | Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Retail installment contracts held for investment | 0.15 | 0.06 |
Retail installment contracts held for investment | Level 3 | Discounted Cash Flow | Prepayment Rate | Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Retail installment contracts held for investment | 0.25 | 0.08 |
Retail installment contracts held for investment | Level 3 | Discounted Cash Flow | Prepayment Rate | Weighted Average | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Retail installment contracts held for investment | 0.15 | |
Retail installment contracts held for investment | Level 3 | Discounted Cash Flow | Loss Severity Rate | Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Retail installment contracts held for investment | 0.50 | 0.50 |
Retail installment contracts held for investment | Level 3 | Discounted Cash Flow | Loss Severity Rate | Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Retail installment contracts held for investment | 0.60 | 0.60 |
Retail installment contracts held for investment | Level 3 | Discounted Cash Flow | Loss Severity Rate | Weighted Average | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Retail installment contracts held for investment | 0.56 | |
Personal loans held for sale (b) | Nonrecurring | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair Value | $ 763,292 | $ 1,007,105 |
Personal loans held for sale (b) | Level 3 | Nonrecurring | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair Value | $ 763,292 | $ 1,007,105 |
Personal loans held for sale (b) | Level 3 | Market Approach | Market Participant View | Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Personal loans held for sale | 0.60 | 0.70 |
Personal loans held for sale (b) | Level 3 | Market Approach | Market Participant View | Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Personal loans held for sale | 0.70 | 0.80 |
Personal loans held for sale (b) | Level 3 | Income Approach | Discount Rate | Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Personal loans held for sale | 0.20 | 0.15 |
Personal loans held for sale (b) | Level 3 | Income Approach | Discount Rate | Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Personal loans held for sale | 0.30 | 0.25 |
Personal loans held for sale (b) | Level 3 | Income Approach | Default Rate | Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Personal loans held for sale | 0.40 | 0.30 |
Personal loans held for sale (b) | Level 3 | Income Approach | Default Rate | Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Personal loans held for sale | 0.50 | 0.40 |
Personal loans held for sale (b) | Level 3 | Income Approach | Loss Severity Rate | Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Personal loans held for sale | 0.90 | 0.90 |
Personal loans held for sale (b) | Level 3 | Income Approach | Loss Severity Rate | Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Personal loans held for sale | 0.95 | 0.95 |
Personal loans held for sale (b) | Level 3 | Income Approach | Net Principal & Interest Payment Rate | Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Personal loans held for sale | 0.65 | 0.70 |
Personal loans held for sale (b) | Level 3 | Income Approach | Net Principal & Interest Payment Rate | Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Personal loans held for sale | 0.75 | 0.85 |
Fair Value of Financial Instr_7
Fair Value of Financial Instruments - Summary of Fair Value Estimates, Methods and Assumptions (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Assets: | ||
Investments in debt securities held to maturity | $ 50,381 | |
Carrying Value | ||
Assets: | ||
Cash and cash equivalents | 105,616 | $ 81,848 |
Finance receivables held for investment, net | 27,253,256 | 27,544,162 |
Restricted cash and cash equivalents | 2,267,154 | 2,079,239 |
Investments in debt securities held to maturity | 50,381 | 0 |
Total | 29,676,407 | 29,705,249 |
Liabilities: | ||
Notes payable — facilities with third parties | 2,803,684 | 5,399,931 |
Notes payable — secured structured financings | 27,364,089 | 28,141,885 |
Notes payable — facilities with Santander and related subsidiaries | 11,201,574 | 5,652,325 |
Total | 41,369,347 | 39,194,141 |
Estimated Fair Value | ||
Assets: | ||
Cash and cash equivalents | 105,616 | 81,848 |
Finance receivables held for investment, net | 29,354,905 | 28,133,427 |
Restricted cash and cash equivalents | 2,267,154 | 2,079,239 |
Investments in debt securities held to maturity | 50,942 | 0 |
Total | 31,778,617 | 30,294,514 |
Liabilities: | ||
Notes payable — facilities with third parties | 2,803,684 | 5,399,931 |
Notes payable — secured structured financings | 27,883,027 | 28,360,948 |
Notes payable — facilities with Santander and related subsidiaries | 11,539,861 | 5,724,675 |
Total | 42,226,572 | 39,485,554 |
Estimated Fair Value | Level 1 | ||
Assets: | ||
Cash and cash equivalents | 105,616 | 81,848 |
Finance receivables held for investment, net | 0 | 0 |
Restricted cash and cash equivalents | 2,267,154 | 2,079,239 |
Investments in debt securities held to maturity | 0 | 0 |
Total | 2,372,770 | 2,161,087 |
Liabilities: | ||
Notes payable — facilities with third parties | 0 | 0 |
Notes payable — secured structured financings | 0 | 0 |
Notes payable — facilities with Santander and related subsidiaries | 0 | 0 |
Total | 0 | 0 |
Estimated Fair Value | Level 2 | ||
Assets: | ||
Cash and cash equivalents | 0 | 0 |
Finance receivables held for investment, net | 0 | 1,009,358 |
Restricted cash and cash equivalents | 0 | 0 |
Investments in debt securities held to maturity | 50,942 | 0 |
Total | 50,942 | 1,009,358 |
Liabilities: | ||
Notes payable — facilities with third parties | 0 | 0 |
Notes payable — secured structured financings | 18,638,472 | 18,646,326 |
Notes payable — facilities with Santander and related subsidiaries | 0 | 0 |
Total | 18,638,472 | 18,646,326 |
Estimated Fair Value | Level 3 | ||
Assets: | ||
Cash and cash equivalents | 0 | 0 |
Finance receivables held for investment, net | 29,354,905 | 27,124,069 |
Restricted cash and cash equivalents | 0 | 0 |
Investments in debt securities held to maturity | 0 | 0 |
Total | 29,354,905 | 27,124,069 |
Liabilities: | ||
Notes payable — facilities with third parties | 2,803,684 | 5,399,931 |
Notes payable — secured structured financings | 9,244,555 | 9,714,622 |
Notes payable — facilities with Santander and related subsidiaries | 11,539,861 | 5,724,675 |
Total | $ 23,588,100 | $ 20,839,228 |
Investment Losses, Net - Schedu
Investment Losses, Net - Schedule of Investment Gains (Losses), Net (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Investments, Debt and Equity Securities [Abstract] | ||||
Gain (loss) on sale of loans and leases | $ (13,669) | $ 0 | $ (40,553) | $ 0 |
Lower of cost or market adjustments | (56,598) | (87,454) | (241,198) | (239,166) |
Other gains, (losses and impairments), net | 1,278 | 1,057 | 1,754 | 885 |
Investment losses, net | $ (68,989) | $ (86,397) | $ (279,997) | $ (238,281) |
Investment Losses, Net - Additi
Investment Losses, Net - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Investments, Debt and Equity Securities [Abstract] | ||||
Lower of cost or market adjustment, customer default activity | $ 81,247 | $ 102,478 | $ 278,144 | $ 308,899 |
Lower of cost or market adjustment | $ 24,649 | $ 15,023 | $ 36,946 | $ 69,732 |
Income Taxes - Narrative (10-Q)
Income Taxes - Narrative (10-Q) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |||||
Income tax expense (benefit) | $ 172,476,000 | $ 82,156,000 | $ 137,161,000 | $ 283,684,000 | |
Effective income tax rate | 26.00% | 26.10% | 26.00% | 25.10% | |
Related party income tax receivables | $ 1,003,000 | $ 1,003,000 | $ 11,010,000 | ||
Earnings that are considered indefinitely reinvested | $ 0 | $ 0 | $ 0 |
Computation of Basic and Dilu_3
Computation of Basic and Diluted Earnings per Common Share - Additional Information (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Employee Stock Option | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Awards excluded from computation of earnings per share (in shares) | 52,114 | 0 | 52,114 | 24,507 |
Computation of Basic and Dilu_4
Computation of Basic and Diluted Earnings per Common Share - Summary of Computation of Basic and Diluted Earnings per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Earnings per common share | ||||
Net income (loss) | $ 490,115 | $ 232,538 | $ 389,450 | $ 848,308 |
Weighted average number of common shares outstanding before restricted participating shares (in shares) | 310,150,000 | 345,470,000 | 321,276,000 | 349,342,000 |
Weighted average number of common shares outstanding (in shares) | 310,150,293 | 345,469,657 | 321,275,907 | 349,341,627 |
Earnings per common share (in dollars per share) | $ 1.58 | $ 0.67 | $ 1.21 | $ 2.43 |
Earnings per common share - assuming dilution | ||||
Net income (loss) | $ 490,115 | $ 232,538 | $ 389,450 | $ 848,308 |
Weighted average number of common shares outstanding (in shares) | 310,150,293 | 345,469,657 | 321,275,907 | 349,341,627 |
Effect of employee stock-based awards (in shares) | 157,000 | 486,000 | 216,000 | 514,000 |
Weighted average number of common shares outstanding - assuming dilution (in shares) | 310,307,265 | 345,956,043 | 321,492,331 | 349,855,822 |
Earnings per common share - assuming dilution (in dollars per share) | $ 1.58 | $ 0.67 | $ 1.21 | $ 2.42 |
Commitments and Contingencies -
Commitments and Contingencies - Liabilities for Commitments and Contingencies (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Loss Contingencies [Line Items] | ||
Total commitments and contingencies | $ 122,855 | $ 155,055 |
Consumer arrangements | ||
Loss Contingencies [Line Items] | ||
Contingencies | 25,099 | 1,991 |
Aggregate legal and regulatory liabilities | ||
Loss Contingencies [Line Items] | ||
Contingencies | 45,047 | 137,000 |
Revenue-sharing and gain/(loss), net-sharing payments | Chrysler | ||
Loss Contingencies [Line Items] | ||
Commitments | 50,809 | 12,132 |
Servicer performance fee | Bank of America | ||
Loss Contingencies [Line Items] | ||
Commitments | 1,508 | 2,503 |
Loss-sharing payments | CBP | ||
Loss Contingencies [Line Items] | ||
Commitments | $ 392 | $ 1,429 |
Commitments and Contingencies_2
Commitments and Contingencies - Chrysler Agreement (Details) - Chrysler - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Other Commitments [Line Items] | ||
Funding available for FCA retail financing | $ 4,500,000,000 | |
Minimum | ||
Other Commitments [Line Items] | ||
Funding available for dealer inventory financing | 5,000,000,000 | |
Revenue-sharing and gain/(loss), net-sharing payments | ||
Other Commitments [Line Items] | ||
Amount accrued for the payments | $ 50,809,000 | $ 12,132,000 |
Commitments and Contingencies_3
Commitments and Contingencies - Agreement with Bank of America (Details) - Bank of America - USD ($) | Jan. 31, 2017 | Sep. 30, 2020 | Dec. 31, 2019 |
Other Commitments [Line Items] | |||
Commitment to sell loans | $ 300,000,000 | ||
Servicer performance payments due, period | 6 years | ||
Servicer performance fee | |||
Other Commitments [Line Items] | |||
Commitments | $ 1,508,000 | $ 2,503,000 |
Commitments and Contingencies_4
Commitments and Contingencies - Agreement with CBP (Details) - CBP - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Dec. 31, 2019 | |
Other Commitments [Line Items] | ||
Loans servicing, loss-sharing payment percentage | 0.50% | |
Loss-sharing payments | ||
Other Commitments [Line Items] | ||
Commitments | $ 392 | $ 1,429 |
Commitments and Contingencies_5
Commitments and Contingencies - Other Contingencies (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Consumer arrangements | ||
Other Commitments [Line Items] | ||
Accrual for miscellaneous contingencies | $ 25,099 | $ 1,991 |
Commitments and Contingencies_6
Commitments and Contingencies - Legal and Regulatory Proceedings (Details) - USD ($) $ in Thousands | Jul. 28, 2020 | May 19, 2020 | Sep. 30, 2020 | Dec. 31, 2019 |
Deka Investment v. Santander Comsumer USA Holdings Inc. | ||||
Loss Contingencies [Line Items] | ||||
Loss contingency, damages paid, value | $ 47,000 | |||
Aggregate Legal and Regulatory Liabilities | ||||
Loss Contingencies [Line Items] | ||||
Contingencies | $ 45,047 | $ 137,000 | ||
Maximum possible loss | $ 11,500 | |||
Consumer Remediation | ||||
Loss Contingencies [Line Items] | ||||
Litigation settlement, amount awarded to other party | $ 65,000 | |||
Investigation Costs | ||||
Loss Contingencies [Line Items] | ||||
Litigation settlement, amount awarded to other party | 5,000 | |||
Settlement Administration Costs | ||||
Loss Contingencies [Line Items] | ||||
Litigation settlement, amount awarded to other party | 2,000 | |||
Debt Forgiveness | ||||
Loss Contingencies [Line Items] | ||||
Litigation settlement, amount awarded to other party | $ 45,000 |
Commitments and Contingencies_7
Commitments and Contingencies - Agreements (Details) - USD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | |
Other Commitments [Line Items] | ||||
Purchase obligation | $ 13,281,000 | $ 10,628,000 | ||
Purchase commitment, repurchase rate (up to) | 9.99% | |||
Retainer rate (up to) upon exercise of repurchase right | 20.00% | |||
Repurchase requests outstanding | $ 0 | |||
Commitment to sell charged off loan receivables in bankruptcy sale | 350,000,000 | |||
Sales subject to market price check | 275,000,000 | |||
Remaining aggregate commitment to sell charged off loan receivables | 27,702,000 | 39,787,000 | ||
Bluestem | Purchase New Advances on Personal Revolving Finance Receivable | ||||
Other Commitments [Line Items] | ||||
Commitments | 2,800,000,000 | 3,000,000,000 | $ 3,100,000,000 | |
Purchases of receivables | 800,000,000 | $ 1,200,000,000 | ||
Bluestem | Purchase Of Receivables Related To New Opened Customer Accounts | ||||
Other Commitments [Line Items] | ||||
Purchases of receivables | $ 151,163,000 | $ 137,821,000 |
Related-Party Transactions - In
Related-Party Transactions - Interest Expense and Accrued Interest (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
SHUSA | |||||
Related Party Transaction [Line Items] | |||||
Interest expense for affiliate lines/letters of credit | $ 79,854,000 | $ 54,963,000 | $ 213,224,000 | $ 145,840,000 | |
Accrued interest for affiliate lines/letters of credit | 42,718,000 | 42,718,000 | $ 29,326,000 | ||
Santander | |||||
Related Party Transaction [Line Items] | |||||
Interest expense for affiliate lines/letters of credit | 7,997,000 | $ 0 | 8,700,000 | $ 0 | |
Accrued interest for affiliate lines/letters of credit | $ 1,512,000 | $ 1,512,000 | $ 0 |
Related-Party Transactions - Cr
Related-Party Transactions - Credit Facilities (Details) - Santander - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2015 | Dec. 31, 2019 | |
Related Party Transaction [Line Items] | |||||
Guarantee fee, basis spread (as a percent) | 0.125% | ||||
Guarantee fee expense | $ 0 | $ 0 | $ 384,000 | ||
Guarantee fee payable | $ 0 | $ 0 | $ 0 |
Related-Party Transactions - De
Related-Party Transactions - Derivatives (Details) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Related Party Transaction [Line Items] | ||
Collateral overage on derivative liabilities | $ 5,184,000 | $ 41,669,000 |
Santander and Affiliates | ||
Related Party Transaction [Line Items] | ||
Outstanding notional amount | 3,264,580,000 | 1,874,100,000 |
Collateral overage on derivative liabilities | $ 554,000 | $ 2,220,000 |
Related-Party Transactions - Re
Related-Party Transactions - Retail Installment Contracts and RV Marine (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Related Party Transaction [Line Items] | ||||
Servicing fee income | $ 18,574 | $ 21,447 | $ 56,797 | $ 70,255 |
SBNA | Serviced Auto Loan and Retail Installment | ||||
Related Party Transaction [Line Items] | ||||
Servicing fee income | $ 472 | $ 377 | $ 1,566 | $ 1,154 |
Related-Party Transactions - Sc
Related-Party Transactions - Schedule of Serviced Auto Loan and Retail Installment Contract Portfolio (Details) - SBNA - Serviced Auto Loan and Retail Installment - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Related Party Transaction [Line Items] | ||
Total serviced portfolio | $ 209,453 | $ 277,669 |
Cash collections due to owner | 17,793 | 14,908 |
Servicing fees receivable | $ 1,938 | $ 738 |
Related-Party Transactions - _2
Related-Party Transactions - Dealer Lending (Details) - SBNA - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Related Party Transaction [Line Items] | |||||
Referral fee | $ 9,000,000 | ||||
Referral fee, amortization period | 10 years | ||||
Unamortized fee balance | $ 2,475,000 | $ 2,475,000 | $ 3,150,000 | ||
Income related to referral fee | 225,000 | $ 675,000 | 225,000 | $ 675,000 | |
Dealer Loan Portfolio | |||||
Related Party Transaction [Line Items] | |||||
Due from related parties | 0 | 0 | 0 | ||
Loan Origination on Sales of Floorplan Inventory | |||||
Related Party Transaction [Line Items] | |||||
Due to related parties | $ 9,754,000 | $ 9,754,000 | $ 5,384,000 |
Related-Party Transactions - _3
Related-Party Transactions - Schedule of Transactions with SBNA (Details) - SBNA - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Origination and Renewal Fees | ||||
Related Party Transaction [Line Items] | ||||
Revenue from related parties | $ 451 | $ 1,291 | $ 2,473 | $ 4,218 |
Servicing Fees Expenses | ||||
Related Party Transaction [Line Items] | ||||
Expenses from transaction with related party | $ (9) | $ 52 | $ 63 | $ 113 |
Related-Party Transactions - Or
Related-Party Transactions - Origination Support Services (Details) - Affiliates - SBNA - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Purchase of Retail Installment Contracts | ||||
Related Party Transaction [Line Items] | ||||
Additions to servicing asset | $ 1,100,000 | $ 2,100,000 | $ 3,900,000 | $ 5,000,000 |
Referral And Servicing Fee | ||||
Related Party Transaction [Line Items] | ||||
Revenue from related parties | 7,902 | 19,892 | 29,457 | 45,716 |
Due from related parties | $ 4,089 | $ 8,114 | $ 4,089 | $ 8,114 |
Related-Party Transactions - Se
Related-Party Transactions - Securitizations (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Santander | |||||
Related Party Transaction [Line Items] | |||||
Due from related parties | $ 1,247 | $ 1,247 | $ 1,869 | ||
Due to related parties | 6,879 | 6,879 | $ 8,180 | ||
Affiliates | SIS | Fees Paid for Co-Management of Certain Securitizations | |||||
Related Party Transaction [Line Items] | |||||
Expenses from transaction with related party | $ 103 | $ 929 | $ 1,625 | $ 1,894 |
Related-Party Transactions - Ot
Related-Party Transactions - Other Information on SPAIN Securitization (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Related Party Transaction [Line Items] | ||||
Servicing fee income | $ 10,050 | $ 13,117 | $ 33,923 | $ 40,405 |
Santander | ||||
Related Party Transaction [Line Items] | ||||
Servicing fee income | $ 4,488 | $ 4,743 | $ 15,680 | $ 20,885 |
Related-Party Transactions - CE
Related-Party Transactions - CEO and Other Employee Compensation (Details) - SHUSA - Affiliates $ in Thousands | Sep. 30, 2020USD ($) |
Compensation Expense Based on Time Allocation | |
Related Party Transaction [Line Items] | |
Due from related parties | $ 163 |
Administrative Services | |
Related Party Transaction [Line Items] | |
Due to related parties | 9,221 |
Due from related parties | $ 4,198 |
Related-Party Transactions - _4
Related-Party Transactions - Other Related Party Transactions (Details) ft² in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020USD ($)ft² | Sep. 30, 2019USD ($) | Sep. 30, 2020USD ($)ft² | Sep. 30, 2019USD ($) | Dec. 31, 2019USD ($) | |
Related Party Transaction [Line Items] | |||||
Deposit and checking accounts balance | $ 26,920,000 | $ 26,920,000 | $ 41,785,000 | ||
Affiliates | SBNA | |||||
Related Party Transaction [Line Items] | |||||
Deposit and checking accounts balance | $ 26,920,000 | $ 26,920,000 | $ 33,683,000 | ||
Affiliates | SBNA | Sublease of Corporate Office Space | |||||
Related Party Transaction [Line Items] | |||||
Area of property (in square foot) | ft² | 13 | 13 | |||
Sublease income | $ 44,000 | $ 44,000 | $ 132,000 | $ 132,000 | |
Affiliates | SBNA | Fee for Payments Made at Retail Branch Locations | |||||
Related Party Transaction [Line Items] | |||||
Expenses from transaction with related party | 39,000 | 49,000 | 140,000 | 182,000 | |
Affiliates | Santander | Procurement Services | |||||
Related Party Transaction [Line Items] | |||||
Expenses from transaction with related party | 785,000 | 765,000 | 2,079,000 | 1,780,000 | |
Affiliates | Santander | Professional Services, Telecommunications, and Internal/External Application | |||||
Related Party Transaction [Line Items] | |||||
Expenses from transaction with related party | 279,000 | 71,000 | 350,000 | 300,000 | |
Affiliates | SHUSA | |||||
Related Party Transaction [Line Items] | |||||
Cyber liability insurance, coverage limit | 270,000,000 | ||||
Affiliates | SHUSA | Allocated Portion of Insurance Premiums and Fees | |||||
Related Party Transaction [Line Items] | |||||
Expenses from transaction with related party | 97,000 | 108,000 | 313,000 | 324,000 | |
Affiliates | SHUSA | Various Other Insurance Products | |||||
Related Party Transaction [Line Items] | |||||
Expenses from transaction with related party | $ 416,000 | $ 183,000 | $ 781,000 | $ 571,000 |
Employee Benefit Plans - Additi
Employee Benefit Plans - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2013 | Dec. 31, 2011 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Common stock, shares issued (in shares) | 363,138,607 | 363,138,607 | 362,798,115 | ||||
Expiration period | 10 years | ||||||
Compensation expense paid | $ 6,161,000 | $ 7,973,000 | |||||
MEP | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Common shares stock awards available for grant (in shares) | 29,000,000 | ||||||
MEP | Employees | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock vesting period | 5 years | ||||||
Omnibus Incentive Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Common stock, shares issued (in shares) | 5,192,641 | ||||||
Compensation expense | $ 0 | $ 0 | $ 0 | $ 0 | |||
Omnibus Incentive Plan | Restricted Stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Common shares stock awards available for grant (in shares) | 583,890 | 583,890 | |||||
Omnibus Incentive Plan | RSUs | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Transfer and sale restrictions period | 1 year | ||||||
Omnibus Incentive Plan | RSUs | Certain Officers | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock vesting period | 3 years | ||||||
Omnibus Incentive Plan | RSUs | Vesting One | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock vesting period | 3 years | ||||||
Omnibus Incentive Plan | RSUs | Vesting Two | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock vesting period | 5 years |
Employee Benefit Plans - Summar
Employee Benefit Plans - Summary of Stock Options and Related Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Dec. 31, 2019 | |
Shares | ||
Options outstanding as of beginning of period (in shares) | 273,737 | |
Granted (in shares) | 0 | |
Exercised (in shares) | (67,241) | |
Expired (in shares) | (15,440) | |
Forfeited (in shares) | (13,460) | |
Other (in shares) | 0 | |
Options outstanding as of end of period (in shares) | 177,596 | 273,737 |
Options exercisable as of end of period (in shares) | 177,596 | |
Options expected to vest as of period end (in shares) | 0 | |
Weighted Average Exercise Price | ||
Options outstanding as of beginning of period (in dollars per share) | $ 13.09 | |
Granted (in dollars per share) | 0 | |
Exercised (in dollars per share) | 9.97 | |
Expired (in dollars per share) | 25.89 | |
Forfeited (in dollars per share) | 17.25 | |
Other (in dollars per share) | 0 | |
Options outstanding as of end of period (in dollars per share) | 12.84 | $ 13.09 |
Options exercisable, weighted average exercise price as of end of period (in dollars per share) | 12.84 | |
Options expected to vest, weighted average exercise price as of period end (in dollars per share) | $ 0 | |
Weighted Average Remaining Contractual Term (Years) | ||
Options outstanding (in years) | 2 years 2 months 12 days | 3 years 1 month 6 days |
Options exercisable (in years) | 2 years 2 months 12 days | |
Aggregate Intrinsic Value | ||
Options outstanding as of beginning period | $ 2,867 | |
Exercised | 868 | |
Options outstanding as of end of period | 1,126 | $ 2,867 |
Options exercisable | 1,126 | |
Option expected to vest | $ 0 |
Employee Benefit Plans - Schedu
Employee Benefit Plans - Schedule of Restricted Stock and Performance Stock Units (Details) - Restricted Stock and Performance Stock Units - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Dec. 31, 2019 | |
Shares | ||
Outstanding as of beginning of period (in shares) | 498,299 | |
Granted (in shares) | 268,438 | |
Vested (in shares) | (365,740) | |
Forfeited/canceled (in shares) | (12,953) | |
Outstanding as of end of period (in shares) | 388,044 | 498,299 |
Weighted Average Grant Date Fair Value | ||
Outstanding as of beginning of period (in dollars per share) | $ 17.41 | |
Granted (in dollars per share) | 24.02 | |
Vested (in dollars per share) | 19.64 | |
Forfeited/canceled (in dollars per share) | 17.97 | |
Outstanding as of end of period (in dollars per share) | $ 19.98 | $ 17.41 |
Weighted Average Remaining Contractual Term (Years) | ||
Option outstanding (in years) | 1 year | 10 months 24 days |
Aggregate Intrinsic Value | ||
Outstanding as of beginning of period | $ 11,645 | |
Vested | $ 8,557 | |
Unvested as of end of period | $ 7,059 |