LPRO - Earnings call 4 2023 | Open Lending Corporation

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good afternoon, and welcome to Open Lending's Fourth Quarter and Full Year 2023 Earnings Conference Call.

As a reminder, today's conference call is being recorded.

On the call today are Keith Jezek, CEO; and Chuck Jehl, CFO. Earlier today, the company posted its fourth quarter and full year 2023 earnings release and supplemental slides to its Investor Relations website.

In the release, You will find reconciliations of non-GAAP financial measures to the most comparable GAAP financial measures discussed on this call.

today, would estimated remind that and company's as I call that represent begin, view contain XXXX. may other of we like you to this the Before XX, February forward-looking statements Lending events circumstances. future any to or to these update Open statements disclaims reflect obligation

for actual implied Please to results from expressed or SEC to such release concerning statements. factors filing with and differ refer information a that with earnings the today's more could cause those

Keith Jezek. pass the call Mr. over And go now Please to I'll ahead.

Keith Jezek

you, and good afternoon, and Thank us Conference Thank today XXXX Quarter Call. Year everyone. Fourth joining operator, you for for Open Full Earnings Lending's

I profit team range loans and and am each change our share, negative we quarter. a revenues in exceeded of thank for our certified the end delivering report results. am team, pleased for guidance our that fourth proud the of excluding our I'd with in estimate I to these associated high members like to of

we loans For million year nearly million, million generated EBITDA common of $XX.X in stock. and of revenue our in the $XXX.X $XX.X million XXXX, delivered and before $XX.X total repurchasing adjusted full certified cash XXX,XXX

availability needed inventory funds purchase directly a reflect automotive the I the face credit to and affordability index, lending metrics. and levels, consumer credit rate performance weeks high Fed constrained income environment, a open the As highest in of XXXX, over lending years, which on impacts XX represents worsening which vehicle

to and pandemic. highest Additionally, experienced credit loan-to-share ratio share unions the since prior low the decades growth

us our by to go-to-market key focused our improve improve. market as and backdrop, further product affordable. talent well strategy making mission refine on industry growth invest this remain continue conditions and lives to in We for change transportation our Against we to position technology

XXXX in enhanced Notably, fourth protection quarter. in launching accomplishments an of our most lenders proprietary significant scorecard was the one

transactions, developed maintained over X an of with scorecard accounts checking to XXX sources detailed and additional report TransUnion. beyond us million provides expanded alternative access and The attributes XXX by additional new data million consumer data includes suite Our LexisNexis. credit

AI model attributes trained new to anticipate proprietary our and is carriers our frequency and most credit time, that by we risk lenders borrowers. risk, default validated which leverages a algorithms set over improve Our We scorecard our could against machine of protection predictive data for identify ultimately and expect will large learning the performance. lenders, Open and lower predicting Lending's the

of NAFCU, recognized to by Federal contributions Award Enhanced for selected This Innovation award Association the valuable most the XXXX technology recognizes or scorecard. Unions, software. Protection Open and Credit recently in effort the our Lenders as success, including innovative was who groundbreaking advancements making of and NAFCU winner National union Lending the companies credit The

incorporated our additional to product our probabilities, In delivered direct-to-consumer scorecard, technology addition application improved team to to XXXX, implemented the new on decision improvements including prequalified to and and turnaround improving deployed process a in to and internal workflows. for customers' lenders logic systems, to complex our improve experience, our new developed daily platform decisioning and of a enhancing difficult better ability bolster align provide our our efficiency adjudication origination and with default helping time is lender's a thereby for logic that in underwriting the claims loan claims implement further

it with business technology to actions and making our implement easier and do to Open improvements continue will and we of with the have Lending. expectation these Through to others, product

with were assets to new new which signing XX% year of are Of In go-to-market systems a already is combined of were QX origination capacity for the similar only focus billion. lending Turning loan to in certified the testament the integrations. as of operate have accounts added XXXX, of we a This on total to quarter. size. contribute prior that more and am we that $XX comparison compared in to accounts. to accounts existing larger volume, loan have XX likely meaningful pleased X% recently added, accounts technology our XXXX, fourth these quarter execution. In our I almost XX report successful

we addition, conditions. continue closely In monitor auto to and macroeconomic sector

I we high provide elevated further total like interest cost supply insights higher prices affordability, and brought rates First, on consumers demand vehicle would of in with into insurance to ownership On shock, by gas, XXXX. challenges the faced faced a reached XX% from and industry December year stretched in Auto down be XXXX. as year-over-year. highs of XXXX, XX% continue declining was almost up loan April with savings over rates in to X.X% consumers XX-plus expenses peak which maintenance delinquency rates, and

credit more consumers pressure total shift XX% all lenders even have is this In $X.XX which indicating their trillion, seen addition, card almost on underwriting super-prime as now most year-over-year, auto debt these and we up and of borrowers. towards In consumer. perceive tighten seek environment, safety standards to prime the is lenders

with experienced XXXX, since XXXX growth the before or X.X% share level they of XXXX to as lowest challenged X.X%. deposit be approximately to of continue slowest unions QX the compared FY share Credit growth

loan throughout Lending ratios unions credit represent as led impacting in to approximately XX% XXXX, high has cert slowdown combined our Open This, to with volume. of a share loan total growth

return to Automotive XXXX a its report and called auto inventory U.S. Looking and incentives recently normalcy to XXXX, best XXXX, do vehicle for higher. be Carbar predicts to is the prices year the rise market ahead the XXXX to we in released slightly be anticipate to expecting pandemic. in Cox for The since Cox will decline market. stabilization. forecast

interest potentially later the XXXX has year. signs environment Additionally, been to rates stable August since this rate and many lower point

happen, benefit affordability. consumer to that to a we Should be expect that would

benefit of index MUVVI Vehicle MUVVI, net for compared auto projects a in a unlikely XXXX Index higher For wholesale used only Open X% vehicles declined auto the suggesting which the than XX% forecast Lending. would increase XXXX, current to Value in or increase Used X.X% are the prices, Cox's used term, a prices levels. in in Manheim be materially near pre-pandemic XXXX, the approximately leading to though specifically, used indicator remains

Historically, these always always in automotive industry the by have rebound led autos. and proven used are to cycles nearly

but the of the a previously, purchase new may transportation. heard cannot can of you consumers As vehicle, ultimately, purchase have me they defer defer say

core turning XXXX signs data X% unions. share our There share QX credit union of Now growth increased are in average Preliminary [Audio Gap] suggests growth. to and customer, was early credit

rated insurance carrier partners.

We are and that to serve. join us in our on consumers of pleased stability have lenders Core they adding Specialty behalf to the

in of bank bank FY we expand lenders XXXX. dozens where plan we have new to already focus customers Secondly, the signed producing and X our segment in

regional within value are We investing a our to and community banks are capable of this segment. of in with existing product the relationships unique who team proposition dedicated selling

analysis, significant participants And than very our our a union is importantly, larger market on Based are this customer. credit most opportunity. in this average

have prospects, bank appetite lend based and our in Additionally, with the to lending this environment. on the conversations capacity they

response long-term like of To in sincerely making members again in I'm I in the wrap as like efforts. up, before our encouraged continued thank my by to their mission about I on change by affordable. the position opportunities remain team our during would us. for I lives times XXXX all these to confidence to our transportation confident our beyond we execute difficult team of express would industry. our and

the XXXX, believe ever, the recovers. to strong, ecosystem strong executing our be pent-up fact, the auto capture demand value is inevitably the auto in players we'll priorities retail as well by on I industry various positioned proposition in as and in to our

With that, XXXX. well results like to over in for to on would call review further I Chuck? as Chuck our provide turn QX to thoughts the detail QX outlook as the

Charles Jehl

Keith. Thanks,

Total compared XX,XXX certified million we profit revenue of facilitated in During quarter negative million. XXX an XXXX, with quarter fourth the the in for includes $XX.X revenue in negative which $XX.X in in of loans certified loans was $XX.X change of million XXXX, estimate the XXXX. associated to of ASC quarter of $XX.X XXXX which fourth million, to fourth XX,XXX the compared a estimate of our change includes fourth share quarter

claims fees in of due the $XX.X Excluding and program revenue revenues share were the million, we $X.X revenues. previously million our high and exceeded range to of in mentioned for total while quarter both break change $X.X change XXXX, revenues fee million end other profit in down the loans in administration estimate revenue the the negative certified To guidance and estimate. fourth was quarter negative fourth negative were of impact

profit reminder, over from paid is be revenue comprised life program. asset. the to carrier The the to insurance and our our expected contract claims monthly expected a the of receipts and share the As less less the share partners net contracts us earned to XX%, of the premiums is reduce profit attributable expenses

certified certified million the fourth with $XXX Profit XXXX of or in share as or $XX.X revenue quarter per was of loan new million fourth quarter XXXX. originations the loan per to $XX.X compared in $XXX associated

each revenue revenue on quarter. we to GAAP related the require This during reevaluate periods for estimate U.S. of based the period quantify internal and prior reminder, profit reported a As estimate for rules requires available external change the available consideration process the quarter. variable the share information to in information both that recognition evaluation new

this extent measure with of in accounting loss the forecasted changes applying to impact this cumulative a new to a And combined a previous change frequency our and to is impact share the standard, In estimate data positive when Profit estimate quarter will new negative presents current in vice forecast, results. of in a prepayments. to change versa, information previous previously our operating impact in default, actual to of represents results. a operating information result result to forecast, positive will negative available severity adjustment

estimate total back in loans revenue XXX,XXX $XX.X dating over XXXX negative and million over in-force QX The represents of XXXX insured change of the ASC cumulative XXX recognized with profit portfolio. in for associated implementation share $XXX date periods million January to is in

estimate negative cumulative fourth includes a Importantly, of quarter the of recognized is change impact million, profit adjustment which perspective, since XXXX. share in put this the in to XXXX positive in $X.X the the

to current of in increased industry year default, have considered auto delinquency mentioned, the claim reflect Keith rates quarter with change higher-than-expected highs, and negative submissions in projections driver estimate. we frequency of As which the combination XX-plus the adjusting primary higher to

industry result, declined Value the a Manheim of severity end factor In the loss negative as Used addition, projections of the was in Vehicle faster or at a quarter. Index and also QX MUVVI, current than

Lastly, lower-than-expected in the slightly longer portfolio remained premiums in projected. as prepayments loans factor previously a force were on than favorable

the we the risk appropriately taking, may we for to As implemented continue that are price past price further and adjustments. years over recall, to will price you evaluate X increases we multiple

enhanced in late addition predicting anticipate default we lower as launched mentioned Keith risk. pricing, we which XXXX, better will frequency by In scorecard to earlier, QX an

ultimately with We for carrier are take partners our our focus actions driving a lenders, Lending. to credit targeted and on now pricing and additional better Open improved positioned performance

XXXX of were quarter was income in quarter million Operating $X.X XXXX. $XX.X $XX.X million in quarter compared compared to the in of operating fourth fourth expenses XXXX quarter to loss the in of $X.X XXXX. million the Operating of million the fourth of fourth

for Net to million in loss as of loss was the the a XXXX. fourth quarter diluted a fourth fourth $X.X and of the previous quarter. compared $X.XX quarter compared XXXX to share of $X.XX of loss was per Basic million year $X.X in loss the quarter in XXXX of net

for quarter of XXXX. XXXX loss profit $X.X the as a a EBITDA was in of of $X.X to of fourth fourth Adjusted compared million quarter million the

estimate, measures the Excluding share non-GAAP press found earnings that in GAAP change EBITDA at There's financial a our in of we generated adjusted profit quarter fourth of be $XX.X release. reconciliation in million of XXXX. the can back revenue to

of contract unrestricted $XXX stock shares before $XX.X net tax $XXX.X We quarter cash, cash in million assets, share. in of with total $XX.X XXXX, and outstanding the generated of had million million total acquiring $XX.X assets of X.X an common $X.XX in million debt. million at fiscal exited in in we year liabilities, deferred which was an was $XXX.X which million price average million $XX.X $XXX.X assets. in million We our million In or per

under million our of share expires which program, We have the current of at the XXXX. remaining end first quarter repurchase $XX

QX XXXX on Now moving guidance. to our

continued and we encouraged XXXX and, and when capacity prime as environment. of consumers of factors continued high elevated course, to cost to levels vehicle guidance. be total inflation, constrained due rates, QX considered impact ownership While are that of were The in following prices our appear affordability market continued stabilizing, at competitive lending credit cash the focus of conditions towards options, interest less prime elevated other cost buyers and standards our unions, of due shift percentage tighter to underwriting their elevated making high challenges funds continue interest have to lenders super borrowers, rate inventory credit unions

between million; Accordingly, quarter $XX to XXXX million total XX,XXX; and our $XX is follows: as be between EBITDA be revenue adjusted guidance to and million. loans $XX of certified for the million XX,XXX to and be first between total and $XX

afford sheet, and -- have current strong of positive all navigate which near-term flow. conditions. market needed maturities cash We to the no resilience a balance us debt generate

we cycle experience, Based is At before. our prior different target impact navigated Open our is versus cycles consumer. impacting economic have and market what how the X and through of inflation Lending, on analysis these the it in this is

As made expect demand the we during recover, to sector times. have and capture macroeconomic and on conditions the and inevitably capitalize we measured challenging investments thoughtful economically pent-up

to joining for thank today, we'll us take your like everyone and now We'd questions.

Operator

Instructions] [Operator comes from Heckmann question Davidson. with Peter The line of the first D.A.

Peter Heckmann

to for loans. what the the your some a and much expect a quarter. of of you you are didn't Rates resume Can talk I outlook auto seem little to customers reached We about plateau refinancing in thinking the programs? have lending bit appetite may in here But terms for some guess refinancing of fourth moderate.

Charles Jehl

start right. frame stabilize but further since guess, is see hearing seen I'll can have unlikely they actions. bit. I think Keith is it's what you're in now, We're But any mean we've not I jump rates what a the time cut stabilized Pete, all March Chuck. we're in. to we've August, and seen I that a

having the it's and being it our us credit an that about do as the lent refinance really and if for business what unions customer and capacity there's really refi, really loan. out. primary back -- lending our to key to think come we ability even of to -- just how is I And kind opportunity just think the us will

we we've -- we've else. -- anything and don't signs that. that's of know believe you seen comments, want But signs in prepared of that said seen the Keith, -- that's improvement to if as add So I

Keith Jezek

the on we volume question. in pent-up there point great probably for mean, demand at up and believe percentage in tipped will put And QX. last a certainly large you're as for certified fact, refi rates noting, the XX anticipate have the very that a call future. just been rates the refi demand X year slightly, books, that's it so last years, so these in in Yes, we our the as large be ever in loans highest it I pent-up

Peter Heckmann

just institutions. the appetite of institution. underwriting that the below in yet, then And we're I number the normalizes. for XXX it. of I mean, lot active higher with, there the for is certainly, what, of not prime. -- run or Is the benefit of of Got just year whole metrics haven't -- terms volumes prior that numbers if financial of think you ended so because loans the size I a I in we to saw but really we guess mean some periods loan all a the of appetite mean, that as certainly, really market that, I average of lack seeing apply for I or the potential significant the

Keith Jezek

as been doubt, begin accounts There on Well, solely we up, general. will institutions the size no months XX in is strategy larger is has volume last well good to is asset reflected point. to larger the a focus add this we Again, you you're and hope their ramp our as significant speaking. over as Keith these raised to what begin in aware,

can we And already have make heard about, further gone we from integrations we below their days. volume in XXX fact, with down just LOSs diverse successful has And sure install me that talk time the so XXX roughly our as to days want revenue you've faster.

get much, only we're not are faster. accounts much to able we that revenue bigger first targeting to So the

Operator

of David Next with question JMP line comes Securities. Scharf from the

David Scharf

some follow growth. commentary to of credit the on up wanted union on I Keith,

Were to they guess, environments. a more aspects various I slowest how credit -- what union down years. writing competitive credit the is XX-plus get the to typically your indicating for or you start just Did rate signs noticed in, what I environment, Just of quickly. too versus was fourth and value respond some first deposit prop kind a banks, rate quarter? of how community in environments, and different the to compelling in see are a less in you to regional lower sense advantages either rate of unions rebound You trying growth a

focusing Because of to the customer the consumer been bottomed about as discussions increasingly, it have now refrain seems liquidity your like what's marketplace in side more this a familiar quarters, opposed recent the of or union credit on out.

Keith Jezek

sorry, I'm you that repeat last can sentence?

David Scharf

you capacity credit sorry. finally that I'm get union a getting to mean, Really increasing trying a -- out? you are lending have I is bottomed conviction sense. do

Keith Jezek

Well, yes, an us for just that quick I optimism. growth, remarks gives just back. share take let's in great in a opening tried step to seen first we to that's signs, But which referred we've my saw increase and sign what

have Many of the what tighten and we their Fed thing. consumer lenders, to did, our slow the with pause get a including start and only back reversal think core the intended will unions. that the -- so economy rate effect is our credit of to Fed's seeing temporary lead and But temporary, only a credit finance down unions they will we're being outflows. mission share interest will in of and the have continued lag they a the taken lo tightening consumer deposit to us current to of cycles coming and And to shown down. will credit that's to of Prior lending. lead is And lead community-based that growth relief actions. to a behold all

David Scharf

of just it. shocks cycle. different a from trying back unique of the aspects taking Got to all sort as and this external follow-up, again once of And step maybe a

is been it value in the a discussions that One environment I cycle, Can -- bogged proposition the the reserve -- a down prop uncertainty or relief. you're that's themes potentially the so that not communicated to conversations having with CECL just loss sort that yet. hasn't case. as potential those clients during lot are of And for of even factor be lifetime you're potential into higher of to now talk of is is that even where even always instinctively, greater lenders think finding relief lenders losses like upfront necessarily environment, of right much where the in new And sales would are value how just about a part you seems potential the the this you CECL just just that playing has would company greater. and

Keith Jezek

Keith we the answer is the new in to question out. seeing I love call industry is this your speaking. addition lined of Well, in because what what are being we

So had their loan-to-share ratio is time, being take the being low, high at they to growth for a the and share in CECL XXXX decades with reserves. decade first on

almost was it lending. growth this potential in this the slow So down triple whammy

Our weekly have around discussions ever we just relief. as just prospective are current proposition, and engaged needed as in and customers the program about with as the value CECL to much before, this that conversation them we're of get value and customers the valuable valid the

Operator

line Needham from Kyle question Company. the comes with Next & of Peterson

Kyle Peterson

at last couple can are. quarters, taken but on couple of expected guide, the just least I some profit the what different in how on of next of least Obviously, months XXX guys assumptions, revisions kind XQ we ASC and adjustments. about so are assuming of model prior sense wanted of some changes get you of wanted thinking couple of front? of you near developments the guys in the the a to macro off over a the share you've in what are period on to start that here at the negative developments kind just I

Charles Jehl

'XX. Maybe worsened of The step I'll just bit. fiscal industry kind credit has Chuck. the we and think about it's throughout market just Kyle, start. back a

and and loan increased, you savings increased continue if card we're servicing. we're like note, loss throughout credit For is and engine, XX-year lenders performance immune then And and to to all plus Delinquency not pricing delinquencies the Open despite credit the think eroded, defaults it's delinquency overall of participants debt we're dependent important and -- across for lenders of decision year. about lender. auto And Lending, the grow highs. our defaults a our to not But consumer their on strength and rates lender. of the

we're So not a servicer.

think -- of delinquencies XXX our the in industry. I book the day the in kind points plus to delinquencies non-prime that basis XX-plus than points backdrop XX in better So or

So industry we're plus, X.X%, XX and the X.X%. is

think now Manheim about we $XX.X as we the the Index Used the the and peak booked the XX Manheim 'XX, right claims MUVVI, quarter, it, are in you and and the worst-performing out. call and think vintages, -- and to think million we're highs, what the what the I in the are Vehicle late about Value into are that's and defaults those peak on put of vintages XX months 'XX seeing

in in seeing we're what company a that's as industry everybody So working through and the is.

$XX.X we the then million it the quarter. about loss, impacted -- frequency think more than Manheim in more just also the industry was that you if expected, the down default main of severity us booked well. was Cox So And the driver came the really as than expected of and MUVVI

impacts. negative So X were those

then better And impact. speeds that positive and was was projected, than there prepay we were a

So together, what the book $XX.X you adjustment of that all put in the the generated million back book. that's

and we vintages, we're feel something moving us comment, into think like as past feel like months well XX that those like to that's behind soon. to be we is worst-performing hopefully we in your feel So XX forward about going

I I kind the So to that's hope want helpful. on back. -- give bit of perspective little but the of a just

implemented risk a and default of new scorecard, be the risk better ROP And take in the the mentioned appropriate going predictor credits. for card, default prepared less in measures that on different the and we've comments, X.X scores taken, price certain to and we've Keith a delinquencies

book. protect to believe our So actions we to the taking we're continue appropriate

Kyle Peterson

color. your there's about bank gone, in I a some I conversation know been bit. concerns little follow-up conversations a and assets estate of real the specifically commercial volatility lot of how just concentration, appreciate a like But different such. loan some Helpful. commercial more And the of with diversify might a book? little loan the I book. that the historically from been partner the bank there some guess, more appetite the clients, with regulatory Has skewed to impetus you to have given guys maybe with banks to diversify some and particularly

not guys some late. and have Or like muni your as of recent any volatility such impacts the seeing you with from banks of

Keith Jezek

this speaking. is And Keith Yes.

a to and heightened the of among specifically just -- a segment. weeks at I need as deal all question. book is interest lending priorities a our the they ago, kind auto banks finance think business X on good business types there's it's and from to a cohort. that couple of focusing around Community more large of fair the were the I near this in non-prime of sector of to check -- bank XX and this we're We of Act. last CRA, those and automotive with heavily book the of growing as boxes noted business chief of around then that this conference in Relief That's grow reasons grow you great there's why, well interest book know,

Operator

line the with John from Hecht comes question Next of Jefferies.

John Hecht

maybe the we First same kind I question think you have year, seasonality of growth kind organic a element you you might trends sales there maybe guys but mean type is talking through I activity about, at counterparties guess, to how up. of signed about newer with do seasonal the bottoming year? is you're that and this same-store get the some go time, as usually, of out the business, of surf

or we a certs of would the range, activity from of that an forecasting. chance think in kind kind the we mean of more it that -- QX. year there I which think So flat expectation about said you quarter you you the the is will -- first do sets seasonal do in I the grow middle mean, throughout or CERT trends as follow

Charles Jehl

we Yes, as the and or puts unions. still, lending of it's difficult just and growth. on about deposit at and as takes I guidance we're that. levels, the it's think to about go could it, putting tightening focused prime. on. the It's prices, credit prime Keith and saw. We around so a much talked talked in affordability quarterly the And inventory really on the the elevated capacity going in growth with -- out super and John, guide Chuck. the just on project there's time you share about

So is guide, from about as the a in And QX month obviously is flat QX our the March company. to for you think the strong best.

strong probably delay not month always season, you the the due read but to are is but did March seasonally on as QX there's even and smaller. dollar we refunds refunds quarter, tax best amounts tax a that And of is even

in hard project. So timing of cut, our things that's about later now. might -- think so as And the looks really March. it's all any in It not thought start to a to year, went see of like into And the inputs we quarter. we full Fed to there year, hopefully, be the going cut we'll happen those to that, but

John Hecht

where share levels it cert mean, the been the premiums, drifted share, reprice we is some do those thinking think and think per go -- basis. around program of a XXX the current mean, has range? of while. on then a program I you profit se, as for trajectory fees I little I profit And about per you've But kind lower. Okay. fees

Charles Jehl

right? start mix, Yes, volume the based It's all we'll we I with in mean, program our have on discounts program fees. volume, on fees.

but talked we're place that around going in fine. to good share, and we've on and But about, $XXX program think million, $XXX on do number a new be model. it's average is have scorecard predicting profit think risk -- a of default. And I we to that this that range better modeling B for So in I the probability

share vintage, stressed to we've that about before about ultimate this we've -- the a new loss ratio, ratio. at talked to even XX% QX profit But $XXX loss vintage an the

the 'XX and -- perform talked better 'XX, about late So new that vintages on previous I my worse. comment older vintages seeing about performing the the vintages than we're

there, room books better. -- will hopeful but some million a the environment, on but in the that's be they're could we perform it there put it So $XXX at current little that stress with

Operator

Davis line Next question John comes the from with of Raymond James.

Unknown Analyst

Jade. Taylor on is for This

question. refi the about during X% looks It on up follow refis total the of quarter. a sets Just were like

it's quarter-over-quarter. previously, higher obviously been still but much up So

we So just large as demand. think percent about a how in just certs should curious XXXX, pent-up with refi the total mentioned of

Charles Jehl

X% quarter of in 'XX the down in quarter-over-quarter, refi Well, 'XX. QX fourth from is actually XX%

February what, and So -- and guess, come And starting action, because 'XX a still It refi. rate And the it's refi. a the non-prime even XX% there's free consumer. of the for just the taking talked 'XX opportunity Fed it's of lot peak We obviously, as capacity down on we to up back from huge balance since when lenders believe to started have -- early and our been a single near went digits is there's to in affordability, will in about I us. there great opportunity we the hikes sheet.

give customer to on to just what the to challenges. that's going of the the exact right our hard it's the and based be But kind in of 'XX, percent you capacity core say impacts to now lending

Keith Jezek

absolutely. when And happen. a a refi what upside I will just Tsunami business to we will know happen, that sure of and just call shores. know we nice hit We're as it our think this, the that is We will would exactly just add, we not potential and it this

Unknown Analyst

you've helpful. mentioned And That's you. new in OEMs adding the just OEMs, any recently, think I on then pipeline. Got multiple

there's curious just are conversations if So there progressing. on how any update

Keith Jezek

really Yes. nicely. And is this Great Keith. question. Progressing

milestones solid progression have couple that the are we'll throughout say of me the large cycles. optimistic cautiously through in material long And we're you've success sales multiple prospects a heard them. process. sales As before, with These pipeline,

space around kind In that, well. adding and addition we to larger enterprise-type accounts the captive of keep just as OEM in

very -- and So with captives. the additional pipeline to the the about objectively, growing optimistic the we're future is is pipeline progress growing

eclipsed remarks, say you types As in heard the the auto prepared all loan in now captives have lender the #X source us the as of U.S. other originations

Operator

Jezek [Operator Instructions] I now to turn time. would There questions Keith floor no at closing to like are further for this comments. over the

Keith Jezek

to decades yield default all these going the borrowers over solution your while will to with Well, that Open in credit borrowers individual thank we you. to for Thank time of you, find that away. and Lending important -- rates borrowers These access meeting remember as combines you, X Thank fair file you today. wanted it not visible insurance that lenders a everyone, credit. it's offer thank forward and risk and targets. allows offers say, cut operator, to their look near thin non-prime are unique again. to just I

Operator

concludes This today's teleconference.

You may this at time. your disconnect your lines you Thank participation. for

Open Lending (LPRO) 27 Feb 242023 Q4 Earnings call transcript