RM - Earnings call transcript Q1 2020 | Regional Management Corp.

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Operator

Thank you for standing by. This is the conference operator. Welcome to Regional Management Corp.

First Quarter 2020 Earnings Conference Call. [Operator Instructions]

to conference like Edson to now ICR. with would turn over the Garrett I ahead. go Please

Garrett Edson

prior and you, access and was our which earnings have By found be to announcement call on released may which also presentation, at Thank supplemental afternoon. our good regionalmanagement.com. now, website this and to everyone should

not financial GAAP our the comparable references and posted may except presentation non-GAAP statements, most regionalmanagement.com. projections Also, difficult Corp. discussion of presentation are our of therefore, and intentions on formal reliance earnings or website press of for forward-looking of expressed that law. results obligations can measures. implied more statements, of include The our future SEC future begin remind to should a the filings impact that materially undue measures to announcement we in and are at may the any estimates I within extent placed will results our the revise as Management upon any our to to to not to and that everyone all our certain factors subject assumptions, are could refer or include are today with cause to based earnings of of discussion that forward-looking applicable discussion statements the statements. today actual operating them. and Before recent forward-looking the guarantees Regional could to be remarks, other predict part today. required statements and detailed risks, uncertainties you We on and expectations, and forward-looking of management our or by We Reconciliation our in performance, discussion those found these measure forward-looking which from disclaim the uncertainties be differ and statements These risks various update condition or release,

Management Regional CEO Rob Corp. like Beck, to of I President introduce would now and

Rob Beck

that your and Thanks, Garrett, are the of XXXX serve to us the communities all are families and you safe at earnings and our our our times difficult I and nation the These regional customers, On first COVID-XX pandemic. quarter call. for families and welcome to we that of as behalf hope struggles for everyone management, healthy. navigate

I'd to perform responders team. thank like their moment other to take to safe. health to the nation thank professionals, a regional day entire keep each who the workers, management also care our want admirably jobs I first essential and

and personnel response service crisis outstanding team's continue customers. planning and Our home by lines front incredible, of brand our our to in this on in office to the to provide both execution efforts to who has been the work staff,

Officer, over joined with has role. accounting working and team, a He's nearly has Financial his Mike for Dymski, been in solid Accounting will results. new discuss member I'm of him our to financial forward Regional by who financial with been Regional experience, quarter years services including the XX Mike Chief first I and Officer. years X our Interim look as and Chief of our

and serving during times. on supporting been these has mid-March our since focus Our customers unprecedented

performance, doing we're upon positioned including pandemic, and manage how to I'll help quarter the customers to our we're touch briefly the my response COVID-XX first through While a will on what crisis. first our focus comments to

network we've interruption. operate adhering CDC business closely to largely while social our to result, of responsible service under XX% time, been to mandates. plans Thanks At a without nearly We needs solutions. our the services affordable our state are access guidelines customers of to branches and branch remain all a for with essential continuity provide our considered distancing. credit open operations our And our successful as to March, implementation customers the of this in able

electronic from these work with personnel, by phone, headquarters and our centralized customers convenient our communications, programs message, through options easy customers frequent Our including our also operations to them payment our about also provide their to a borrower with our need portal. remote access able e-mail Through online branches. in-person have the our to for our we're seamless text in technologies. about have special centralized which communication work options, migration of and We're remind information home with and account continued payment electronic to assistant our information to following and contact collectors, customers reduced our

These and include waivers our and renew past crisis. to make managing our through implement for payments natural their for special leveraged programs throughout reduced assistance in to experience that and customers criteria in programs options our loans. relaxed design effective disasters supporting We've borrower this been fee have deferrals, borrowers

renewal facing rates to our monthly special interest hardship in lower programs of lower Our loan extend terms order customers payments. and their their to

appointment enhanced and themes. In to centralized the through system our the we've programs addition, to over our capabilities customers, support in phone, our process electronically by branches these

and other members by team also their the electronic these will continued feel directly execute we've during of customers our the and to with later this those And to necessary branch. customers agreements throughout to cash, the curbside take More roll to providing allowing deferral our flexibility new and policy, customers expanding by paid close We're supporting enter launched allows check having their comfortable needs members make team to a allow payment make plan which loans, close and team including crisis, families payments more service, interacting recently, us, in virus times. time-off by out program the month, impacted to members difficult personal our care to that loans we without remotely. our pay

as We delinquency custom government Building new to support day the month employees that delinquency and stimulus solid end attribute X.X% experience basis our credit of performance X.X%. March model, position of natural XX, operating programs our of day disasters XXX effect. managing customers, delinquency contributed of our well reduction XX-plus the proven by April have on scorecards, lowered XX-plus through as the ending stable rate programs in the Our to through a points credit a as of we taken April. April, borrower assistance with delinquency

While it's to our are for attributable difficult believe acting programs, bridge these to as the they we precise customers. an impacts important calculate

creditworthiness portfolio over that manage the At health April been X.X% our portfolio Approximately and of loans active specifically maintain of programs environment. the quality these loans, the under prior in renewed deferred in XX in requiring qualify X assistance of had changing the remain for from the we the obligations focus engaged qualify a We during average is of constantly deferral. or X X.X% The month crisis. repaying during help paramount times, same our end to during and payment including, an loan our time, their up assistance clearly customers months. our the to prior tailored customers their months for our example, to order borrower at borrower for in programs, our approximately the their and economic programs, borrower we required by our assistance challenging credit least our monitoring also at are debt

the underwriting proactively lending to exposure with high-risk We our originate appropriately new tightened criteria. we've While we've segments done to to COVID-XX standards reduce as the lending loans, tightened so developed. crisis continued

serve customers proprietary data experience maintaining leveraging conservative to risk management appropriately an are while portfolio We using our and our program.

into a branches from experienced new slowdown of as we in in April the clear demand mid-March stayed terms In customers home. lending,

we stabilize, to states. begun have off originations to branch see However, lows the beginning and in improvements are slight some

and acceptable at higher unemployment we returns. As into published stimulus. wake We've since deliver end claims room have indicated the incremental models, programs begun and digital we channels business credit losses level test of to government direct the rising the scorecard to paused still our of in these back that our March, absorb significant we risk-adjusted update of where the uncertainty in late in and mail around

the receivables Despite their efforts liquidate begin by second expect further finance our to to quarter. we states to economies, in reopen

was never Our financial entering the position better. crisis

a We sheet. strong balance have

continue a equity. absorb maintaining operate conservative We leverage while capacity still positive losses and have ratio, stockholders' we to to substantial with

Combining March This March $XXX.X debt XX, portfolio. with our XX. portfolio our equity million and losses to of to debt and equates X.XX equity absorb our tangible of XX% of respectively. equity provides stockholders' losses of ratios capacity to funded for as were million credit allowance million us of and our to of X.XX $XXX.X on funded our As X, $XXX.X to

In business our addition, absorb further generates model losses. additional margin to

compares which million our Over to define loss our XX. of total XX-month as portfolio providing less and margin, general XX March additional administrative roughly or expenses we protection. This $XXX.X months, us trailing past of NCL X.X%, a as of totaled the revenue interest expense, outstanding XX% rate and

liquidity a diversified anticipation Additionally, credit funding we in the strong profile. years proactively to cycle past maintain few over of shift and continue our a

of have million liquidity had As market. million credit from of draw access X, availability our and immediate cash hand million cash securitization of needing we enough liquidity, get $XX of $XX all $XXX to We facilities. immediate on of believe XXXX the through we to without us down including revolving to May

than our business addition, fund of subject pandemic. of to throughout capacity to believe growth. more runway the had credit the operations substantial adequate In future on a support approximately quarter various allowing as we capacity borrowing $XXX In our end, unused facilities, have million the we we of base, COVID-XX fundamental sum, to

revenues quarter grew of the credit of back digits the first prior to period. year-over-year, XX.X% first the by loss Both XXXX. network year an grew quarter by quarter. strong. while XX.X% quarter double annualized from in first with our Credit performance finance receivables by XX.X% remains and The fundamentals compared of business net benign relatively receivables XX.X% Turning The increased to the the to revenue XXXX. compared remained of in first rate

of last to a Our the was stable end XX-plus compared rate delinquency X.X% first March XX at of quarter the as X.X% year. day

from reserves, assumes of the the solid is recovery based for our quarter, of a as trough economic related line on GDP additional of scenario our provision credit reserve our in will in revenues. latter COVID-XX XX% We the that and as second losses customized reflected additional half peak at in drop COVID-XX with top in Offsetting in own year. unemployment to $XX.X provision the to $X.X insurance the well million sometime unemployment an million was trust second beginning peak XX% which

This that by improves, dropping mid-XXXX. scenario also X% gradually assumes to unemployment

the But assume latter assistance from programs. Our from borrower of impact our from offset degree modest benefits be and of government the given remains reserves stimulus seen. the to The programs the level of over benefits, year average, the equivalent unemployment will, who of $XX,XXX stimulus weeks most individuals unemployment. we of earn are receiving direct XX unemployment on expanded annualized believe per and also

our For our that Regional important an than is unemployment while customers bridge much will expanded we borrowers, as be year. working. and for benefits they the a wages less our of the more than for earn or as receive stimulus a they earned many the meaningful expect believe that of will We portion as clients $XX,XXX

and are and our enhanced Given believe as these position strong custom well collections, centralized balance overall our liquidity scorecards confident well we sheet times. that we we business as and our in infrastructure, to challenging equipped navigate through remain including

to while return to economy U.S. challenge. some believe entire a experience to a semblance the on we advantage ahead, through keenly to of pandemic normalcy, positioned will as longer-term are a our supporting have we and continue COVID-XX, to top Looking continue that customer be our focused see, unprecedented opportunities Once continuing that expect we to has customers we we near-term lines. our to passed credit while to and our business the In bright meantime, of know the well we this and there grow bottom future. further impacts result be we the of take enhance and namely

on With financials. color additional to that, over the Mike I'll call our now to provide turn

Mike Dymski

as your in weeks, members and are to Thanks, Rob, and up hello, many to with forward team hope the healthy. investment look continuing I you shareholders past since all all Regional XXXX, of I've our community. I've with well Regional's of you contribute had as to opportunity safe and our working the management success. to of been long-term and and few families the all with everyone. I catch over

COVID-XX X past First a on the first present financial to color results CECL to quarter the quarter build for provide to the discuss the adjusted achieved COVID-XX portion strong the plan the and the were to of of accounting the to and I results assumptions also items. used reserves. performance share for nonoperating our plan year. years. I underlying financial GAAP prior transition results continuation macroeconomic over key I relative will

financial quarter growth, first our on down drill will I loan Lastly, revenue expenses. for performance and

$X.XX net of a the supplemental million per GAAP X highlights. and Page On diluted first loss illustrates provided quarter generated We we presentation, X adjusted results nonoperating share. items. for $X.X Page the or of COVID-XX financial

$XX.X Excluding generated in net our of COVID-XX of and share. million reserves, executive the per financial adjusted we diluted or income $X.XX transition outage impact costs January, system

We to reserves our P&L. along largest of comparison share on Page $X.X $XX.X of of results of million item additional COVID-XX financial XX. Clearly, Flipping each year-over-year items. a line our million with the the the impact had nonoperating

our our with for Excluding provision losses year-over-year finance receivables. increase roughly credit in increase in the COVID-XX, aligned was

loan XX the compared portfolio, seasonality loan portfolio. our saw of is which the to the as made liquidation, On Large $XXX and net XX% basis, or quarter. period. X% core Year-over-year, XX% sequential displays products XX% small our Page million finance the March receivables while prior of X% total total loans grew a just typical portfolio first and represented of up for under XX% XX. our grew loans grew year

levels. growth, April were well year we quarter portfolio prior of originations Although another below double-digit year-over-year consecutive had

As underwriting prudent temporarily paused to and digital second country lead acted mail COVID-XX the in affect loan to liquidation coupled demand, with and portfolio to will These origination. March, we began in direct tighten quarter. the further lower quickly actions,

testing higher of end As direct our we credit mail Rob back have mentioned, the models. at and into channels digital the scorecard begun

product average and the higher-yielding prior Total fee Turning with revenue XX% year small and decreased large is from a increased driven in period, as basis consistent XX% opportunity Interest loan XX prior Page period market compared by points the year strategy. which outpaced finance loan to yield receivables. to growth, growth our our increase mix XX. net

portfolio ongoing APR yield XXX at points approximately March basis to we our quarter, of the in period prior the portfolio. noting In our be fee XX% that or the year lower total on than XX% interest below the has XX. and worth change expect It's mix based as an second of of

primarily during insurance decreased Total unemployment reserve to due unemployment unemployment portfolio this period, a to insurance. from us revenue XX unemployment by covered product even optional $X.X prior points loan product basis related claims help in for on year unforeseen involuntary an credit elevated the Approximately million is yield payments to of from XX% the March. our insurance late keep their Customers track purchased event.

claims does reduced customers XXXX, provide losses insurance period. of elevated product remain offsetting unemployment to are our a during for credit during our the an and expected net unemployment bridge While provides benefit their

XX. Page Moving to

improvement average of quarter year net losses XX.X% a prior as points was the of from finance for basis XX credit of period. the annualized receivables Our first percentage XXXX, an

We expect second the on COVID-XX impact credit rate to XXXX. see from our of half net loss the more prominently in

Flipping to Page XX.

day stood delinquency delinquency period. year basis the XX-plus a XX the prior from X.X%, On our decline level at at front, XX March point

basis As reduced incremental April XX-plus our point an March. XX, improvement to delinquencies further of day XXX X.X%, from

which underwriting to as scorecards positioned our of programs, now resilient has servicing custom assistance solid economic to credit thus delinquency of originations. part have portfolio of low have been loan intently benefits core underwriting portfolio XX% our continue our tighter federal business levels implementation the on also to term, and cycles, In our portfolio has passed focus the performance near scorecard The for of be far. contributed our Internal throughout of we borrower on stimulus and decades, criteria. existing the and

to CECL $XXX.X to Page receivables. losses XX.X% implemented million increased or XXXX finance ended We finance X.X% We million X the of for an Turning $XX.X January XX. and net on allowance with credit accounting allowance of or receivables. of

several XX% XXXX, in forecast allowance and We mid-XXXX. increasing million, scenarios, decline and X% peak to potential XXXX a macroeconomic the following: the which XX% a of the our COVID-XX. the quarter trough losses second stimulus million GDP allowance final quarter impact to for CECL scenario first of of $XX.X borrower contemplated was of in the second a adjusted assistance macroeconomic the benefit quarter of included with by XXXX to economic The and decline the unemployment programs. the then stress to During related by $XX.X credit increased internal for federal ran

Flipping were of in was quarter our higher of in XXXX with period, to $XX.X G&A $X.X expenses than million the Page year line expectations. in first prior million the XX. which

million XXXX investments account transition system executive in of well $X.X by managing of and growth quarter XXXX included novo expansion. along with to growth, novo improvements our corresponding and increased outage first and costs, ongoing capabilities, support in our we expenses de with Even to as our digital de expansion the efficiency continue account perform the expenses expense and evidenced in operating The ratios.

to office quarter, we those quarter cuts, and branch additional expense indexed $X we to loan and is growth to Most economic reduced prudently about liquidation the proactively origination higher the we account our of disruption. and As in be lower second XXXX and million higher portfolio base increase deferrals $X.X during the portfolio home from second expect related for Including G&A expenses anticipated cost de changes expansion. in costs year-over-year. the and novo expenses

We compared by expect increase basis that will ratio our second to prior year quarter operating period. the approximately expense XX points

to of XXXX $XXX,XXX quarter used year of million primarily finance debt the cost of levels the than growth the receivables, was average higher period, of first offset lower in a XX. in by $XX.X to higher Interest strong Turning Page expense prior funds. outstanding in reflecting

rate. receivables from in year percentage interest the as due quarter period, XX to net primarily of point improvement a prior first Our average finance was a basis the X.X%, fed expense funds reductions

quarter. We as sequentially flat expense receivables interest interest in of are million expect forecasting approximate $X.X percentage second to expense average and a be finance to the

funding The average added to of and of completed rate $XXX is rate X.XX%, million securitization XXXX capacity execution our XX in funding profile. fixed weighted best a date. coupon that Page we borrowing our a reminder at strong October

without XXXX market. of the all needing through us get to liquidity sufficient to forecasting securitization are access We

on growth. to million approximately we various our As fund XX, credit of of $XXX facilities March unused capacity had future

X, of X.XX:X. funded $XXX liquidity, debt-to-equity hand down million held revolving credit was $XX facilities. quarter May we million availability And including from of cash our million of immediate Our to cash on draw as of $XX ratio immediate and first

my over concludes call to That turn remarks. the up. back I'll Rob to now wrap

Rob Beck

Thanks, Mike.

for efforts period. team manage as are all unprecedented incredible We members' of we our this through grateful

over the paid that us balance infrastructure reopen ever, navigate the be Regional that the they begins economically our able the is pandemic. have customers playing and to and our enhancements the and weeks them our expect customers role should ahead, with economy We than continue more our help around. And resilient positioned indispensable will turns are provide the Now experience guide to to we for through few through sheet emerge to and ensure for this nation as an there last quickly believe more to made we customers ultimately communities. when the to to our rebound years have challenges, come our in

Thank open up open Operator, line? and you, your you I'll interest. for now the for again, call time please questions. could the

Operator

David from Our with Instructions] question comes [Operator Scharf Securities. JMP first

David Scharf

We X levels. particularly appreciate reserve the wondering, point. all of at known there just Rob, every the obviously, XX underlying this the I'm unknowns are -- behind for disclosure, assumptions there's

we to am no So origination just are returning curious, where concentrated, geographically second under about, obviously, we're given are limits volumes the we forecasting. kind respect But I you of in the seeing illusions quarter. have you --

behavioral among of differences kind may if applications in customers but there George's you're different or I'm terms up curious, in any willing to I'm those in? nevertheless, switch inbound And state? discernible be to behavioral maybe more in But opening kind of state some people versus from other curious are of it has payments early particular, experiment even being any electronic resulted patterns markets to early, credit of

Rob Beck

questions. great and David, Thanks, Yes.

some going up are pace. the our knowing to on within at local So local counties that are pace. uneven open an open at even And to different level, we're monitoring a up activity states, a states going

actually that At point to look still have the very So the at we're analytics to activity. trends. moment, it's early to any to try

in We trend. a second some bottom did terms obviously, It's from April. the say in say, the the too of saw of we shoots that's week here call whether in green to early originations that early

to We with indicative have interact where were up customers digitally. wanting electronic which seen we us is versus payments crisis, pick pre

just too it's So to early tell.

X states quickly largest South open and Carolina and seem Texas, they our pretty Now be are moving obviously, up. to to

hoping be economies So through the to we the going to look able going the it's into we're analytic third see of with second trends emerging something watching those and the forward quickly as -- take capabilities, strong quarter. see that up. we obviously, be open advantage the And opportunities quarter can as and we

David Scharf

April. in I Got it. just And as your kicking was, on that well sure the assistance in delinquency by want as stimulus both some of I know follow-up maybe performance you explained programs. part, Understood. to clear. a driven large from it federal to make I'm March

number basis way this monthly it programs of the sort rate the the of this eyes, normally point been. of is have we your aren't stage presented, bucket is terms reduction that kick once part delinquency there's a is in be than fact normalized? XX-plus that people deferrals that should day some Or in of fair In would early just viewing -- as sequentially a the that XXX in

Rob Beck

Well, buckets. be the across XX-plus will all

deferral average So the our X.X% assistance programs, can year. which on up percentages, amount customers advantage X.X%, look the you of at the last is see from that as if at including of you from taking deferrals, borrower various are program,

portion in the are some in majority but are So programs, bucket. the pre-delinquency bucket, XX-plus deferral those delinquency the

advantage at bring in to deferral keep delinquencies would they to it's have back customer what because drop for programs. Similarly, stimulus, has customers we deferral or of took least to hard very they accepted to payment if at X engaged, X driven be months. the that those the government to and ask So as current as make the scientific

And month, much X.X%. our government in was much at delinquency of point deferral a stood their that's that's to of terms due hard the could in by But the the kind as apart program. to a as make bucket stimulus of ability we XX-plus Now to the in the break to where stimulus. little payment to how are science versus be of driven part that time at government how end the

David Scharf

any, last of assistance? the question, are that there on quick loans it. the if of borrower rates the permanent should loan just in modifications, X any there any of terms part Got And impact are effective changes you? And to as

Rob Beck

So have we interest April. customer. general, in month more on to the of Mike We than payment do reduce anything? clarity to some we loan the did when or deferrals loan the the rate extend And you the But Mike, lower modifications terms, for modifications. do more in may specifics. it's want add the

Mike Dymski

Sure. Thanks David. for question, the

borrower renewals We traditional programs the to renew into loan, modifications are of portion one they more revitalized end extensions but extensions of term those modification market-based that terms, back will have we over with all circumstances, in have do of a multiple programs. hardship through rate cases our and and certain they and portfolio more And certain at programs. loan carry rate modifications the the delinquent customers assistance customer If -- those time and in do periods. go stressed help the of many in time come cases, renewals delinquent is the the term

Rob Beck

times but add also would hurricanes. I to here only during programs David, time-tested and reduce difficult natural the customer them, this. proven times, And These disasters Regional. through We Yes. bridge to deploy to particularly just Regional. they're losses at and are for And of not obviously well-oiled

Operator

Carr Our comes question next with from Ryan Jefferies.

Ryan Carr

those And programs? into programs several percentage are beyond have from what loans place be that customers Cares Notably, then had modified in what the borrow stimulus. your under that gone over annualized months, some weeks have under just past and assistance curious, of of been the So Act. the to you've been the a lot impact you noted they'd that, amount through that earning seeing of your

curious cash? you -- the I'm going -- points seen the be are going thoughts to a to delinquencies seeing you is there noted to with to consumer to hear You from flushed be in what down have moving going the your an but curious do April, forward? And trend originations reduced trends is XXX what are foresee impact basis date I'm So on on impacts your date? you stimulus forward. just month-over-month And given need?

Rob Beck

Ryan. Thanks, that. Yes. appreciate I

So have programs. the portfolio assistance taken is of that of number borrower our loans percentage in the of of advantage terms X.X%

over said, So a that's X% little up, I from as historically.

the we payments much look, In the impact versus in expected. have the in terms of forward stimulus, standpoint overall what increase we way didn't of April but year-to-date, saw some when checks hit, initial like through would a see many others material of really and from the an payments, did impact we

think Those there's know. we still go starting to a going their to up a the what the forward that, economies, stimulus benefit consumer demand, confidence factors. coming as is rebound. to stimulus are to clearly foremost are that all go and evaluating degree to through don't be and a is judge government to The loan of how we We're that on it impacting line. first open is factors hard Now like. we and that about lot starting states going make Clearly, look into trends credit

impact. impact it I would of demand. say. Will this is biggest out is to time. economy lot the it's more might at difficult over that consumer just and that confidence. the and having being impact shut a demand demand impact down really right at There's now people not seeking figure We a entering science to believe this to point now is how lot say also an degree art time. But lending The loans is, branches going it's right the or unknown just factors of forward in

Ryan Carr

to And that. a follow-up

how you see they to each -- extending and do branch? that customer’s Or whether do changes? they And do for banks it to like or criteria with that, be that you make like Within within or reduction of modifications request the have modify, how as you? do rate well you portal, some they noted the that into do different from online the you how it tenure. loan? call loan in interest decision the the the You have what come Can do terms is to the

Rob Beck

Well, them. our available clients customer them so contact programs portal calls, texts, we through what our well know assistance on to phone as customer e-mails are let to as

over do indicated deferrals the loan on program to with call, to So And the branches. that able starting we particularly don't needs. we're so are remote the have best contact as what phone the we them phone, their to real-life renewal. closings in do needs their they fit our We're get them, that come a borrowers assess may want and what earlier when into for

So place tools needs those through the customers got we've the to of programs. meet these in

Operator

from with comes question Montgomery Scott. Janney next Our John Rowan

John Rowan

questions. fast is X the of loan -- loan absence down? originations, amortized If Just in your how portfolio

Rob Beck

terms when of not something we've the of loans, that the average for for origination. at tenure average months, origination, is the Yes. we on loans months ever in put them small disclosed That's of The and large duration loans on XX XX assets. our

John Rowan

Okay.

So year to then is that assume well a the for it's duration the portfolio? effective safe over

Rob Beck

I about right. sounds Yes. that mean,

John Rowan

Okay. this reserve we've frankly, it like peers -- for what when projection here guys that made the a all the your assumptions. out give how XQ come that time aggressive Can some a has you who books. I assumption, you or about have than does their what you have and unemployment seem assumption if are assumptions they than, idea your seem gave the was you -- closed some have I X% from me. said, included, as does basically like your It information that's using that us more of said an in your appreciate they at that's pandemic forecasting late that into guys more were of peers Moody's how of and because changed? seen Because

Rob Beck

given from reserve at after high near-term reflect you X look that to And would and I weeks rate. not Yes. decisions at what over be you're banks million that is on are I at is, range. speculate of of a an the teens $XX filings, others a earnings large unemployment The of credibility we're unemployment been clearly, at a that if filed. announcing us of don't And as unemployment, to made towards think least of that, looked want heading weeks, standpoint, it we've the level way just level it trajectory indicative there's that prudent peak. last X already to claims the of just similar that in don't at

Operator

with BTIG Bologna Research. Giuliano from comes question next Our

Giuliano Bologna

you $XX,XXX closer on you your Starting state commentary on the being $XX,XXX. a that the basis? income -- your portfolio out on being looking made about nationwide versus or you to know around at unemployment are exposure rates Do that at benefits

Rob Beck

Yes.

annualized the So on $XX,XXX $X,XXX the check state average at plus we've stimulus at special level, the you're unemployment number if benefit referring that the $XXX ticket weeks for to, individual. level, been plus federal an the that the the one, XX is first

think married $XX,XXX, goes or Now of it a check annualize our that obviously, but less And you're customer a $XX,XXX. number, we if I portion family in. comes $XX,XXX factor X, said, annualized. didn't earns to meaningful we than that a up, that as When it's you base couple of stimulus

more So employed. they than are were make if to some going portion

Giuliano Bologna

earlier great lot That of gave makes is an Obviously, trajectory April in side. week-to-week Within we of a data. Or on versus inflection? month? April, exit you thinking basis a sense. kind the of April are origination Then on seeing the about there you kind any as

Rob Beck

said going said, was I probably improvement looks We've as forward, low factors. is, April you some that April. the tell different earlier, I depends of seen in second I'd the a of the point. as lot of half on second How What week

Now digital mail one thing originations. and that we program is did direct our pause we noted

restarted programs risk-adjusted our now and to credit adjusting still have We achieving higher scores those for mailing the returns. appropriate after

should back up. see we So pick those channels

was tell small those channels. for can April, it in you very As

for that part But that those past from digital us. some learn we're going not So have provide of mailings originations. we've same we're tightened the will credit those box. mailing from and would at opportunity, because should to the tailwind be level in and the as the Obviously, we

the we see picks that, have up. the later as as we from year so in learnings expect economy we'll opportunities And

Giuliano Bologna

cut that. have credit lot sense. kind cycle out makes just box, I a X sense of demand? your of originations your you have of to the follow-up sense in there minor by thinking of normalized a would versus good of tightening this tightened how your the much Is -- you obviously have been That of before a do kind environment of

Rob Beck

being is stressed risk-adjusted We're environment. we we're that make in what appropriate a are we sure number way is What that returns, would we're just on going given where originating deliver prudent not to say putting I the that. tighten, a to doing

Operator

Dezellem with from Tieton. comes question next Our Bill

Bill Dezellem

those of originations of group $XX And Do new start A I'd Or are loans? branch those in million like with all the questions. to April. renewals? include

Rob Beck

well. be would that as renewals No,

Bill Dezellem

Okay. experienced that April year, versus this And compare? approval that April rate how then year you have last in the does of of

Rob Beck

something not it's Bill, we're as this seeing demand rates a Yes. think we've much lower just at historically I in disclosed. don't point. material change as approval

Bill Dezellem

haven't had impact meaningful originations then? So your in a tightened reducing standards credit

Rob Beck

to it we a, got enter you So we mail call, how could and direct tightening digital at in. clearly, exited it because a decide space back side I program, the until X to wanted ways, Well, direct different recalibrate in what those on we think look real the right? we and was

started in month branch tightening of the April. the side, On the

not full this you tightening So the see impact at in may of the time. point

Bill Dezellem

then do to home And And attentive on of dues And pontificate, and over like would, different, do customers their on bills helpful. something I'd and paying that day of day less that therefore, and, unemployed time down you you there's question and past reason? think as X it's end simply X actually distracted you That's for do March. if they're if you think to fell? to is, with overdues, your the your more being why anything the and

Rob Beck

think bucket. right? things, deferrals can be a I the XX-day in Look, of were couple There some X- to it

government think said I the stimulus. I as can be, it earlier,

lots might probably cash flushed more didn't can further of are analyzing. going historically. slip have still and now down have they factors people with that, like that into that pay done You and we're There's

Operator

closing turn Rob the conference any would for session. This Beck to I back to concludes question-and-answer over remarks. like the

Rob Beck

operator, everyone, joining. Thanks, and thanks, for

plenty position, a Retail strong crisis see sheet said I been As do stronger We crisis. earlier, the with in of liquidity and entering never our profile. this into balance strong post has opportunities

on in the looking are economy managing costs collections, the are the crisis post position for we preserving We credit rebounds. and ourselves when talked But about, our all quality, ultimately digital and customer to focused investing our capital. we've things

So I appreciate your questions. And look forward to talking further again.

Operator

call. This concludes conference today's

your pleasant for You have disconnect may day. participating, Thank a you lines. and

Regional Management (RM) 9 May 202020 Q1 Earnings call transcript