Regional Management Corp. · NYSE:RM
Regional Management — SFIG Conference 2017
19 slides from Regional Management's conference presentation, Feb 27, 2017
Slide 1: SFIG Conference February 27–28, 2017
Regional Management Corp. Regional Management Corp. SFIG Conference February 27–28, 2017 RM LISTED NYSE Regional Management Corp.
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation and the responses to various questions contain forward-looking statements, which reflect our current views with respect to, among other things, the Company’s operations and financial performance. You can identify these forward-looking statements by the use of
Slide 3: Company Overview
Company Overview Consumer Finance Installment Lender 30 Years of Operating History Ability-to-Repay, Brick-and-Mortar Business Model Headquartered in Greenville, SC Operations in the Southeast, Southwest, and Mid-Atlantic Near-Prime to Non-Prime Customer Base Parent Company is a Delaware Corporation
Slide 4: Operating History
Operating History RM Founded in South Carolina 1987 2001 RM Enters Texas 2004 Private Equity Invests in RM 2007 2009 RM Operates in 5 States (SC, TX, NC, TN, AL) RM Enters Oklahoma 2011 2012 RM Closes Initial Public Offering and Enters NM Portfolio Reaches $500 Million in Size 2013 RM Enters GA and
Slide 5: Experienced Management Team
Experienced Management Team Board of Directors Peter Knitzer Director and Chief Executive Officer Jody Anderson President and Chief Operating Officer Don Thomas Chief Financial Officer Dan Taggart Chief Risk Officer Brian Fisher General Counsel Jim Ryan Chief Marketing Officer Joseph Manavalan Chief
Slide 6: Strong Corporate Governance and Board of Directors
Strong Corporate Governance and Board of Directors Board of Directors (Non-Employee Directors) Al de Molina • Chairman of RM’s Board of Directors • Former CEO and COO of GMAC • Former CFO of Bank of America • Former CEO of Banc of America Securities Steve Freiberg • Senior Advisor to The Boston Cons
Slide 7: Branch Network Overview
Branch Network Overview Branch Overview • Approximately 358,000 individual borrower accounts through network of 339 branches as of 12/31/2016 - Nearly all loans serviced and collected through branches • Branch personnel establish and develop customer relationships throughout life of loan • Today, lo
Slide 8: Multi-Channel Origination Platform
Multi-Channel Origination Platform • Branches are foundation of Regional’s multi-channel strategy - Primary point of customer contact • Mail campaigns attract ~100,000 new customers per year to Regional • Dealership and retailers serve as “virtual” branches • Online lending pilot launched in 2016 Ne
Slide 9: Multiple Financial Solutions for Customer Base
Multiple Financial Solutions for Customer Base Product diversity allows Regional to offer customers various products as credit needs change Diverse product offerings provide a competitive advantage versus monoline lenders Customer Need Size (a) Term (b) Security Net Receivables (c) # of Loans (b) Av
Slide 10: Significant Market Opportunity
Significant Market Opportunity Our 358,000 customer accounts (as of 12/31/2016) represent a very small fraction of the approximately 115 million Americans that generally align with our customer base. We believe that the personal installment loan segment is an approximately $70 billion market opportu
Slide 11: Consistent Portfolio Growth Through Multiple Business Cycles
Consistent Portfolio Growth Through Multiple Business Cycles Millions $800 $700 $600 $500 $400 $300 $200 $100 $0 Jan-04 Jun-04 Nov-04 Apr-05 Sep-05 Feb-06 Jul-06 Dec-06 May-07 Oct-07 Mar-08 Aug-08 Jan-09 Jun-09 Nov-09 Apr-10 Sep-10 Feb-11 Jul-11 Dec-11 May-12 Oct-12 Mar-13 Aug-13 Jan-14 Jun-14 Nov-1
Slide 12: Monthly Large Loan Originations – Significant Growth Since Late 2014
Monthly Large Loan Originations – Significant Growth Since Late 2014 Millions $25 $20 $15 $10 $5 $0 Feb-07 Apr-07 Jun-07 Aug-07 Oct-07 Dec-07 Feb-08 Apr-08 Jun-08 Aug-08 Oct-08 Dec-08 Feb-09 Apr-09 Jun-09 Aug-09 Oct-09 Dec-09 Feb-10 Apr-10 Jun-10 Aug-10 Oct-10 Dec-10 Feb-11 Apr-11 Jun-11 Aug-11 Oct-
Slide 13: Recent Portfolio Growth Driven by Large Personal Loans
Recent Portfolio Growth Driven by Large Personal Loans Millions $800 $700 $600 $500 $400 33% 8% $300 $200 $100 $0 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-
Slide 14: Well Diversified Geographically
Well Diversified Geographically Large Loan State Distribution TX 22% VA 1% AL 14% GA 2% NC 20% TN 7% SC 20% OK 7% NM 7% Total Portfolio State Distribution TX 28% VA 1% AL 13% GA 2% NC 17% TN 6% SC 23% OK 6% NM 4% 14 * Data calculated based off of net receivable balance by state as of 12/31/16 RM LIS
Slide 15: Large Loan Origination Metrics
Large Loan Origination Metrics APR 30 29 28 27 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Weighted Average APR Original Term Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 A
Slide 16: Portfolio Performance – Large Loans
Portfolio Performance – Large Loans Average FICO -Origination Origination FICO has increased over time 625 622 597 2014 2015 2016 Average Loan Amount -Origination Loan size has increased over time as credit has improved $4,728 $4,291 $4,004 2014 2015 2016 Portfolio 30+ Delinquency Delinquency rate h
Slide 17: Historical Financial Performance
Historical Financial Performance Recent earnings growth driven by combination of volume-related revenue growth and more normalized credit losses Receivables and revenue have grown in parallel Net Income ($ in millions) $28.8 $30 $25.4 $25 $23.4 $24.0 $21.2 $20 $16.4 $14.8 $15 $9.9 $10 $6.5 $5 $3.1 $
Slide 18: Strong Liquidity Profile
Strong Liquidity Profile • Long history of liquidity support from a strong 7-member bank group – Bank of America – Wells Fargo – BMO Harris – Capital One – First Tennessee – Texas Capital – Capital Bank • $585 million committed ABL line (Bank of America acting as Agent) • Maturity Date: August 2019
Slide 19: Regional Management Corp. 19 RM LISTED NYSE REGIONAL MANAGEMENT CORP.
Regional Management Corp. 19 RM LISTED NYSE REGIONAL MANAGEMENT CORP.