United PanAm Financial Corp. Announces Third Quarter 2008 Results

  
    
  
  
    
      United PanAm Financial Corp. (Nasdaq: UPFC) today announced results for 
      its third quarter ended September 30, 2008.
    
    
      For the quarter ended September 30, 2008, UPFC reported net loss of $6.5 
      million, compared to net income of $2.6 million for the same period a 
      year ago. Interest income decreased 8.2% to $54.8 million for the 
      quarter ended September 30, 2008 from $59.7 million for the same period 
      a year ago. UPFC reported net loss of $0.41 per diluted share for the 
      quarter ended September 30, 2008 compared to net income of $0.16 per 
      diluted share for the same period a year ago. The reported net loss for 
      the quarter ended September 30, 2008 includes an after tax charge of 
      $8.9 million or $0.56 per diluted share for restructuring charges 
      associated with the closure of 27 branches in the third quarter of 2008 
      and other non-recurring charges.
    
    
      For the nine months ended September 30, 2008, UPFC reported net loss of 
      $1.1 million, compared to net income of $10.2 million for the same 
      period a year ago. Interest income increased 0.5% to $170.9 million for 
      the nine months ended September 30, 2008 from $170.0 million for the 
      same period a year ago. UPFC reported net loss of $0.07 per diluted 
      share for the nine months ended September 30, 2008 compared to net 
      income of $0.62 per diluted share for the same period a year ago. The 
      reported net loss for the nine months ended September 30, 2008 includes 
      an after tax charge of $13.2 million or $0.84 per diluted share for 
      restructuring charges associated with the closure of 63 branches during 
      the nine months ended September 30, 2008 and other non-recurring charges.
    
    
      As a result of the continued disruptions in the capital markets, 
      including the uncertainty for use of securitizations as a source of 
      financing, as well as the lack of available borrowing capacity under a 
      warehouse facility for an extended period of time, UPFC determined to 
      downsize its operations and reduce its branch footprint in order to 
      lower expenses and meet required liquidity needs. During the quarter 
      ended September 30, 2008, UPFC closed an additional 27 branches bringing 
      the total number of branches to 79 branches in operation as of September 
      30, 2008. The majority of closures were from the consolidation of 
      branches within the same market. The closures of the 63 branches 
      year-to-date resulted in a decrease in the number of employees of 
      approximately 400 or 35% of the work force since December 31, 2007. 
      These closures will result in a significant reduction in overall 
      operating expenses. In addition, UPFC has suspended new loan 
      originations during the end of the third quarter of 2008 to allow UPFC's 
      outstanding receivables to shrink to a level where UPFC's capital base 
      will be able to finance future originations at lower advance structures 
      available in the market.
    
    
      On August 22, 2008, UPFC entered into an amendment to its $300 million 
      warehouse facility, which UPFC has historically used to fund its 
      automobile finance operations to purchase automobile contracts pending 
      securitization. As part of the amendment to exit the warehouse facility, 
      UPFC incurred a fee payable in the amount of $7.3 million. The fee has 
      been recorded as part of the non-recurring charges. The amendment 
      continued the revolving nature of the warehouse facility through its 
      previously scheduled maturity of October 16, 2008. Subsequently, the 
      warehouse facility has now converted to a term loan for an additional 
      one-year term, which amortizes pursuant to a pre-determined schedule, 
      providing that UPFC will pay all amounts owed under the warehouse 
      facility by October 16, 2009. Management is currently pursuing and 
      evaluating alternative sources of financing and is also considering 
      selling receivables on a whole-loan basis. At this time, there is no 
      assurance UPFC will be able to arrange for other types of interim 
      financing or be able to sell receivables on a whole-loan basis in the 
      future.
    
    
      UPFC has obtained temporary waivers from the insurance providers that 
      insure UPFC’s outstanding securitizations 
      regarding the approval of the appointment of Mr. James Vagim as UPFC’s 
      chief executive officer and has also obtained temporary waivers 
      regarding a covenant that UPFC maintain a $250 million warehouse line. 
      UPFC is continuing discussions with the insurance providers to obtain 
      permanent waivers, but there is no assurance UPFC will obtain such 
      waivers. If UPFC is unable to obtain permanent waivers or continued 
      temporary waivers for both these items, then each insurance provider may 
      elect to enforce the various rights and remedies that are governed by 
      the different transaction documents for each securitization.
    
    
      On August 8, 2008, UPFC entered into an agreement to sell $10.0 million 
      of receivables on a whole-loan basis with servicing released.
    
    
      UPFC purchased $38.1 million of automobile contracts during the third 
      quarter of 2008, compared with $149.3 million during the same period a 
      year ago. Contracts outstanding totaled $836.8 million at September 30, 
      2008, compared with $944.1 million at September 30, 2007, representing 
      an 11.4% decrease. The decrease is due to UPFC suspending new loan 
      originations during the end of the third quarter of 2008.
    
    
      The decrease in net income for the quarter ended September 30, 2008 
      compared to the same period a year ago primarily reflects the following:
    
    
      
        Interest income decreased 8.2% to $54.8 million from $59.7 million due 
        primarily to a decrease in average loans outstanding as a result of 
        UPFC’s strategy of downsizing its 
        operations, suspending new loan originations and reducing its branch 
        footprint in order to lower expenses and meet required liquidity needs.
      
      
        Interest expense increased to $13.1 million from $12.5 million due 
        primarily to higher market interest rates on the warehouse facility. 
        As a result, net interest margin decreased from 79.0% for the quarter 
        ended September 30, 2007 to 76.0% for the quarter ended September 30, 
        2008.
      
      
        Provision for loan losses increased due to an increase in the 
        annualized charge-off rate to 9.14% for the quarter ended September 
        30, 2008 from 6.66% for the same period a year ago. The factors that 
        impact the increased charge-off rate are the overall deteriorating 
        economic environment and the adverse effect of a smaller denominator 
        from a declining automobile receivable balance.
      
      
        Non-interest expense increased to $33.9 million from $23.7 million for 
        the same period a year ago. The increase in non-interest expense was 
        due to a pretax restructuring charge of $4.1 million ($2.6 million 
        after tax) associated with the closure of 27 branches. The 
        restructuring charge included severance, fixed asset write-offs, 
        closure and post-closure costs and a $1.8 million reserve for 
        estimated future lease obligations. The other non-recurring charge of 
        $9.9 million ($6.3 million after tax) includes $7.3 million fee 
        payable on the exit from the warehouse facility and $2.6 million 
        associated with professional fees paid on discontinued financing 
        transactions. Non-interest expense, excluding the restructuring 
        charges and other non-recurring charges as a percentage of average 
        loans dropped to 8.9% from 10.1% for the same period a year ago.
      
    
    
      United PanAm Financial Corp.
    
    
      UPFC is a specialty finance company engaged in automobile finance, which 
      includes the purchasing and servicing of automobile installment sales 
      contracts originated by independent and franchised dealers of used 
      automobiles. UPFC conducts its automobile finance business through its 
      wholly-owned subsidiary, United Auto Credit Corporation.
    
    
      Forward Looking Statements
    
    
      Any statements set forth above that are not historical facts are 
      forward-looking statements made pursuant to the safe harbor provisions 
      of the Private Securities Litigation Reform Act (“SLRA”) 
      of 1995, including statements concerning the Company’s 
      strategies, plans, objectives, intentions and projections. Generally, 
      the words “believe,” “expect,” 
      “intend,” “estimate,” 
      “anticipate,” “project,” 
      “realize,” “will” 
      and similar expressions identify forward-looking statements, which 
      generally are not historical in nature. Such statements are subject to a 
      variety of estimates, risks and uncertainties, known and unknown, which 
      may cause the Company’s actual results to 
      differ materially from those anticipated in such forward-looking 
      statements. Potential risks and uncertainties include, but are not 
      limited to, such factors as UPFC’s on 
      securitizations; the lack of a securitization market; UPFC’s 
      need for substantial liquidity to run its business; loans UPFC made to 
      credit-impaired borrowers; reliance on operational systems and controls 
      and key employees; competitive pressures which UPFC faces; changes in 
      the interest rate environment; general economic conditions; the effects 
      of accounting changes; inability to manage consolidating operations; 
      inability to obtain permanent waivers from monoline providers; and other 
      risks discussed in the Company’s filings with 
      the Securities and Exchange Commission (SEC), including the Company’s 
      Annual Report on Form 10-K, which filings are available from the SEC. 
      You should not place undue reliance on forward-looking statements, which 
      speak only as of the date they are made. UPFC undertakes no obligation 
      to publicly update or revise any forward-looking statements.
    
    
      Editors Note: Four pages of selected financial data follow.
    
    
      
        
           
        
      
      
        
          
            United PanAm Financial Corp. and Subsidiaries
          
          
            Consolidated Statements of Financial Condition
          
        
      
      
        
        
        
           
        
        
        
        
           
        
        
           
        
        
           
        
        
        
      
      
        
        
        
        
        
          
            September 30,2008
          
        
        
        
        
        
        
        
        
          December 31,2007
        
      
      
        
          (Dollars in thousands)
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Assets
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Cash
        
        
        
        
          $
        
        
          6,981
        
        
        
        
        
        
        
        
        
        
          $
        
        
          9,909
        
        
        
      
      
        
          Short term investments
        
        
        
        
           
        
        
          9,881
        
        
           
        
        
        
        
        
        
        
        
           
        
        
          7,332
        
        
           
        
      
      
        
          
            Cash and cash equivalents
          
        
        
        
        
        
        
          16,862
        
        
        
        
        
        
        
        
        
        
        
        
          17,241
        
        
        
      
      
        
          Restricted cash
        
        
        
        
        
        
          75,450
        
        
        
        
        
        
        
        
        
        
        
        
          73,633
        
        
        
      
      
        
          Loans
        
        
        
        
        
        
          801,017
        
        
        
        
        
        
        
        
        
        
        
        
          882,651
        
        
        
      
      
        
          Allowance for loan losses
        
        
        
        
           
        
        
          (47,800
        
        
          )
        
        
        
        
        
        
        
        
           
        
        
          (48,386
        
        
          )
        
      
      
        
          Loans, net
        
        
        
        
        
        
          753,217
        
        
        
        
        
        
        
        
        
        
        
        
          834,265
        
        
        
      
      
        
          Premises and equipment, net
        
        
        
        
        
        
          5,225
        
        
        
        
        
        
        
        
        
        
        
        
          6,799
        
        
        
      
      
        
          Interest receivable
        
        
        
        
        
        
          9,151
        
        
        
        
        
        
        
        
        
        
        
        
          10,424
        
        
        
      
      
        
          Other assets
        
        
        
        
           
        
        
          34,670
        
        
           
        
        
        
        
        
        
        
        
           
        
        
          34,819
        
        
           
        
      
      
        
          Total assets
        
        
        
        
          $
        
        
          894,575
        
        
           
        
        
        
        
        
        
        
        
          $
        
        
          977,181
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Liabilities and Shareholders’ Equity
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Securitization notes payable
        
        
        
        
          $
        
        
          469,228
        
        
        
        
        
        
        
        
        
        
          $
        
        
          762,245
        
        
        
      
      
        
          Warehouse line of credit
        
        
        
        
        
        
          237,378
        
        
        
        
        
        
        
        
        
        
        
        
          35,625
        
        
        
      
      
        
          Accrued expenses and other liabilities
        
        
        
        
        
        
          18,938
        
        
        
        
        
        
        
        
        
        
        
        
          9,660
        
        
        
      
      
        
          Junior subordinated debentures
        
        
        
        
           
        
        
          10,310
        
        
           
        
        
        
        
        
        
        
        
           
        
        
          10,310
        
        
           
        
      
      
        
          Total liabilities
        
        
        
        
           
        
        
          735,854
        
        
           
        
        
        
        
        
        
        
        
           
        
        
          817,840
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Preferred stock (no par value):
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Authorized, 2,000,000 shares; no shares issued and outstanding
        
        
        
        
        
        
          —
        
        
        
        
        
        
        
        
        
        
        
        
          —
        
        
        
      
      
        
          Common stock (no par value):
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Authorized, 30,000,000 shares; 15,737,399 shares issued and 
          outstanding at September 30, 2008 and December 31, 2007
        
        
        
        
        
        
          
            50,025
          
        
        
        
        
        
        
        
        
        
        
        
        
          
            49,504
          
        
        
        
      
      
        
          Retained earnings
        
        
        
        
           
        
        
          108,696
        
        
           
        
        
        
        
        
        
        
        
           
        
        
          109,837
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Total shareholders’ equity
        
        
        
        
           
        
        
          158,721
        
        
           
        
        
        
        
        
        
        
        
           
        
        
          159,341
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Total liabilities and shareholders’ equity
        
        
        
        
          $
        
        
          894,575
        
        
           
        
        
        
        
        
        
        
        
          $
        
        
          977,181
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
    
    
      
        
          
            United PanAm Financial Corp. and Subsidiaries
          
          
            Consolidated Statements of Income
          
        
      
      
        
        
        
           
        
        
        
        
           
        
        
        
      
      
        
          
            (In thousands, except per share data)
          
        
        
        
        
          
            Three Months
          
          
            Ended September 30,
          
        
        
          
             
          
        
        
          
            Nine Months
          
          
            Ended September 30,
          
        
      
      
        
        
        
        
        
          2008
        
        
           
        
        
          2007
        
        
        
        
          2008
        
        
           
        
        
          2007
        
      
      
        
          Interest Income
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Loans
        
        
        
        
          $
        
        
          54,281
        
        
        
        
        
        
          $
        
        
          58,668
        
        
        
        
          $
        
        
          169,078
        
        
        
        
        
        
          $
        
        
          166,966
        
      
      
        
          Short term investments and restricted cash
        
        
        
        
           
        
        
          482
        
        
           
        
        
        
        
           
        
        
          1,058
        
        
        
        
           
        
        
          1,781
        
        
           
        
        
        
        
           
        
        
          3,039
        
      
      
        
          Total interest income
        
        
        
        
           
        
        
          54,763
        
        
           
        
        
        
        
           
        
        
          59,726
        
        
        
        
           
        
        
          170,859
        
        
           
        
        
        
        
           
        
        
          170,005
        
      
      
        
          Interest Expense
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Securitization notes payable
        
        
        
        
        
        
          7,995
        
        
        
        
        
        
        
        
          10,171
        
        
        
        
        
        
          28,187
        
        
        
        
        
        
        
        
          27,922
        
      
      
        
          Warehouse line of credit
        
        
        
        
        
        
          5,004
        
        
        
        
        
        
        
        
          2,058
        
        
        
        
        
        
          8,552
        
        
        
        
        
        
        
        
          5,924
        
      
      
        
          Other interest expense
        
        
        
        
           
        
        
          149
        
        
           
        
        
        
        
           
        
        
          303
        
        
        
        
           
        
        
          488
        
        
           
        
        
        
        
           
        
        
          801
        
      
      
        
          Total interest expense
        
        
        
        
           
        
        
          13,148
        
        
           
        
        
        
        
           
        
        
          12,532
        
        
        
        
           
        
        
          37,227
        
        
           
        
        
        
        
           
        
        
          34,647
        
      
      
        
          Net interest income
        
        
        
        
        
        
          41,615
        
        
        
        
        
        
        
        
          47,194
        
        
        
        
        
        
          133,632
        
        
        
        
        
        
        
        
          135,358
        
      
      
        
          Provision for loan losses
        
        
        
        
           
        
        
          18,822
        
        
           
        
        
        
        
           
        
        
          20,031
        
        
        
        
           
        
        
          51,544
        
        
           
        
        
        
        
           
        
        
          48,536
        
      
      
        
          Net interest income after provision for loan losses
        
        
        
        
           
        
        
          22,793
        
        
           
        
        
        
        
           
        
        
          27,163
        
        
        
        
           
        
        
          82,088
        
        
           
        
        
        
        
           
        
        
          86,822
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Non-interest Income
        
        
        
        
        
        
          877
        
        
        
        
        
        
        
        
          469
        
        
        
        
        
        
          1,916
        
        
        
        
        
        
        
        
          1,316
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Non-interest Expense
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Compensation and benefits
        
        
        
        
        
        
          13,032
        
        
        
        
        
        
        
        
          15,054
        
        
        
        
        
        
          44,851
        
        
        
        
        
        
        
        
          45,987
        
      
      
        
          Occupancy
        
        
        
        
        
        
          2,037
        
        
        
        
        
        
        
        
          2,372
        
        
        
        
        
        
          6,641
        
        
        
        
        
        
        
        
          6,818
        
      
      
        
          Other non-interest expense
        
        
        
        
        
        
          4,816
        
        
        
        
        
        
        
        
          6,303
        
        
        
        
        
        
          16,234
        
        
        
        
        
        
        
        
          18,659
        
      
      
        
          Restructuring charges
        
        
        
        
        
        
          4,139
        
        
        
        
        
        
        
        
          —
        
        
        
        
        
        
          7,924
        
        
        
        
        
        
        
        
          —
        
      
      
        
          Other non-recurring charges
        
        
        
        
           
        
        
          9,890
        
        
           
        
        
        
        
           
        
        
          —
        
        
        
        
           
        
        
          9,890
        
        
           
        
        
        
        
           
        
        
          —
        
      
      
        
          Total non-interest expense
        
        
        
        
           
        
        
          33,914
        
        
           
        
        
        
        
           
        
        
          23,729
        
        
        
        
           
        
        
          85,540
        
        
           
        
        
        
        
           
        
        
          71,464
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          (Loss) income before income taxes
        
        
        
        
        
        
          (10,244
        
        
          )
        
        
        
        
        
        
          3,903
        
        
        
        
        
        
          (1,536
        
        
          )
        
        
        
        
        
        
          16,674
        
      
      
        
          Income taxes
        
        
        
        
           
        
        
          (3,765
        
        
          )
        
        
        
        
           
        
        
          1,345
        
        
        
        
           
        
        
          (395
        
        
          )
        
        
        
        
           
        
        
          6,453
        
      
      
        
          Net (loss) income
        
        
        
        
          $
        
        
          (6,479
        
        
          )
        
        
        
        
          $
        
        
          2,558
        
        
        
        
          $
        
        
          (1,141
        
        
          )
        
        
        
        
          $
        
        
          10,221
        
      
      
        
          Earnings per share-basic:
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Net (loss) income
        
        
        
        
          $
        
        
          (0.41
        
        
          )
        
        
        
        
          $
        
        
          0.16
        
        
        
        
          $
        
        
          (0.07
        
        
          )
        
        
        
        
          $
        
        
          0.64
        
      
      
        
          Weighted average basic shares outstanding
        
        
        
        
           
        
        
          15,737
        
        
           
        
        
        
        
           
        
        
          15,732
        
        
        
        
           
        
        
          15,737
        
        
           
        
        
        
        
           
        
        
          15,990
        
      
      
        
          Earnings per share-diluted:
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Net (loss) income
        
        
        
        
          $
        
        
          (0.41
        
        
          )
        
        
        
        
          $
        
        
          0.16
        
        
        
        
          $
        
        
          (0.07
        
        
          )
        
        
        
        
          $
        
        
          0.62
        
      
      
        
          Weighted average diluted shares outstanding
        
        
        
        
           
        
        
          15,789
        
        
           
        
        
        
        
           
        
        
          16,044
        
        
        
        
           
        
        
          15,811
        
        
           
        
        
        
        
           
        
        
          16,558
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
    
    
      
        
        
        
           
        
        
          Numberof Shares
        
        
           
        
        
           
        
        
          CommonStock
        
        
           
        
        
           
        
        
          RetainedEarnings
        
        
           
        
        
           
        
        
          TotalShareholders’Equity
        
      
      
        
           
        
      
      
        
        
        
        
        
          (Dollars in thousands)
        
      
      
        
        
        
        
        
           
        
      
      
        
          Balance, December 31, 2007
        
        
        
        
          15,737,399
        
        
        
        
        
        
          $
        
        
          49,504
        
        
        
        
        
        
          $
        
        
          109,837
        
        
        
        
        
        
        
        
          $
        
        
          159,341
        
        
        
      
      
        
          Net loss
        
        
        
        
          —
        
        
        
        
        
        
        
        
          —
        
        
        
        
        
        
        
        
          (1,141
        
        
          )
        
        
        
        
        
        
        
        
          (1,141
        
        
          )
        
      
      
        
          Stock-based compensation expense
        
        
        
        
          —
        
        
        
        
        
        
           
        
        
          521
        
        
        
        
        
        
           
        
        
          —
        
        
           
        
        
        
        
        
        
           
        
        
          521
        
        
           
        
      
      
        
        
        
        
        
          
             
          
        
        
        
        
        
        
          
             
          
        
        
        
        
        
        
          
             
          
        
        
        
        
        
        
          
             
          
        
      
      
        
          Balance, September 30, 2008
        
        
        
        
          15,737,399
        
        
        
        
        
        
          $
        
        
          50,025
        
        
        
        
        
        
          $
        
        
          108,696
        
        
           
        
        
        
        
        
        
          $
        
        
          158,721
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
    
    
      
        
          
            United PanAm Financial Corp. and Subsidiaries
          
          
            Selected Financial Data
          
        
      
      
        
        
        
           
        
        
        
        
           
        
        
        
      
      
        
          
            (Dollars in thousands)
          
        
        
        
        
          At or For the

          
            Three Months Ended
          
        
        
        
        
          At or For the

          
            Nine Months Ended
          
        
      
      
        
        
        
        
        
          September 30,

          
            2008
          
        
        
           
        
        
          September 30,

          
            2007
          
        
        
        
        
          September 30,

          
            2008
          
        
        
           
        
        
          September 30,

          
            2007
          
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Operating Data
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Contracts purchased
        
        
        
        
          $
        
        
          38,136
        
        
        
        
        
        
          $
        
        
          149,294
        
        
        
        
        
        
          $
        
        
          266,574
        
        
        
        
        
        
          $
        
        
          484,741
        
        
        
      
      
        
          Contracts outstanding
        
        
        
        
          $
        
        
          836,792
        
        
        
        
        
        
          $
        
        
          944,101
        
        
        
        
        
        
          $
        
        
          836,792
        
        
        
        
        
        
          $
        
        
          944,101
        
        
        
      
      
        
          Unearned acquisition discounts
        
        
        
        
          $
        
        
          (35,775
        
        
          )
        
        
        
        
          $
        
        
          (45,728
        
        
          )
        
        
        
        
          $
        
        
          (35,775
        
        
          )
        
        
        
        
          $
        
        
          (45,728
        
        
          )
        
      
      
        
          Average loan balance
        
        
        
        
          $
        
        
          884,433
        
        
        
        
        
        
          $
        
        
          934,334
        
        
        
        
        
        
          $
        
        
          910,319
        
        
        
        
        
        
          $
        
        
          887,548
        
        
        
      
      
        
          Unearned acquisition discounts to gross loans
        
        
        
        
        
        
          4.28
        
        
          %
        
        
        
        
        
        
          4.84
        
        
          %
        
        
        
        
        
        
          4.28
        
        
          %
        
        
        
        
        
        
          4.84
        
        
          %
        
      
      
        
          Average percentage rate to borrowers
        
        
        
        
        
        
          22.72
        
        
          %
        
        
        
        
        
        
          22.62
        
        
          %
        
        
        
        
        
        
          22.72
        
        
          %
        
        
        
        
        
        
          22.62
        
        
          %
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Loan Quality Data
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Allowance for loan losses
        
        
        
        
          $
        
        
          (47,800
        
        
          )
        
        
        
        
          $
        
        
          (46,050
        
        
          )
        
        
        
        
          $
        
        
          (47,800
        
        
          )
        
        
        
        
          $
        
        
          (46,050
        
        
          )
        
      
      
        
          
            Allowance for loan losses to gross loans net of unearned 
            acquisition discounts
          
        
        
        
        
        
        
          
            5.97
          
        
        
          
            %
          
        
        
        
        
        
        
          
            5.13
          
        
        
          
            %
          
        
        
        
        
        
        
          
            5.97
          
        
        
          
            %
          
        
        
        
        
        
        
          
            5.13
          
        
        
          
            %
          
        
      
      
        
          Delinquencies (% of net contracts)
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          31-60 days
        
        
        
        
        
        
          1.13
        
        
          %
        
        
        
        
        
        
          0.71
        
        
          %
        
        
        
        
        
        
          1.13
        
        
          %
        
        
        
        
        
        
          0.71
        
        
          %
        
      
      
        
          61-90 days
        
        
        
        
        
        
          0.29
        
        
          %
        
        
        
        
        
        
          0.28
        
        
          %
        
        
        
        
        
        
          0.29
        
        
          %
        
        
        
        
        
        
          0.28
        
        
          %
        
      
      
        
          90+ days
        
        
        
        
           
        
        
          0.15
        
        
          %
        
        
        
        
           
        
        
          0.18
        
        
          %
        
        
        
        
           
        
        
          0.15
        
        
          %
        
        
        
        
           
        
        
          0.18
        
        
          %
        
      
      
        
          Total
        
        
        
        
        
        
          1.57
        
        
          %
        
        
        
        
        
        
          1.17
        
        
          %
        
        
        
        
        
        
          1.57
        
        
          %
        
        
        
        
        
        
          1.17
        
        
          %
        
      
      
        
          Repossessions over 30 days past due (% of net contracts)
        
        
        
        
        
        
          1.08
        
        
          %
        
        
        
        
        
        
          0.76
        
        
          %
        
        
        
        
        
        
          1.08
        
        
          %
        
        
        
        
        
        
          0.76
        
        
          %
        
      
      
        
          Annualized net charge-offs to average loans (1)
        
        
        
        
        
        
          9.14
        
        
          %
        
        
        
        
        
        
          6.66
        
        
          %
        
        
        
        
        
        
          7.65
        
        
          %
        
        
        
        
        
        
          5.80
        
        
          %
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Other Data
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Number of branches
        
        
        
        
        
        
          79
        
        
        
        
        
        
        
        
          142
        
        
        
        
        
        
        
        
          79
        
        
        
        
        
        
        
        
          142
        
        
        
      
      
        
          Number of employees
        
        
        
        
        
        
          750
        
        
        
        
        
        
        
        
          1,095
        
        
        
        
        
        
        
        
          750
        
        
        
        
        
        
        
        
          1,095
        
        
        
      
      
        
          Interest income
        
        
        
        
          $
        
        
          54,763
        
        
        
        
        
        
          $
        
        
          59,726
        
        
        
        
        
        
          $
        
        
          170,859
        
        
        
        
        
        
          $
        
        
          170,005
        
        
        
      
      
        
          Interest expense
        
        
        
        
          $
        
        
          13,148
        
        
        
        
        
        
          $
        
        
          12,532
        
        
        
        
        
        
          $
        
        
          37,227
        
        
        
        
        
        
          $
        
        
          34,647
        
        
        
      
      
        
          Interest margin
        
        
        
        
          $
        
        
          41,615
        
        
        
        
        
        
          $
        
        
          47,194
        
        
        
        
        
        
          $
        
        
          133,632
        
        
        
        
        
        
          $
        
        
          135,358
        
        
        
      
      
        
          Net interest margin as a percentage of interest income
        
        
        
        
        
        
          75.99
        
        
          %
        
        
        
        
        
        
          79.02
        
        
          %
        
        
        
        
        
        
          78.21
        
        
          %
        
        
        
        
        
        
          79.62
        
        
          %
        
      
      
        
          Net interest margin as a percentage of average loans (1)
        
        
        
        
        
        
          18.72
        
        
          %
        
        
        
        
        
        
          20.04
        
        
          %
        
        
        
        
        
        
          19.61
        
        
          %
        
        
        
        
        
        
          20.39
        
        
          %
        
      
      
        
          Non-interest expense to average loans (1)
        
        
        
        
        
        
          15.25
        
        
          %
        
        
        
        
        
        
          10.08
        
        
          %
        
        
        
        
        
        
          12.55
        
        
          %
        
        
        
        
        
        
          10.77
        
        
          %
        
      
      
        
          Non-interest expense to average loans (2)
        
        
        
        
        
        
          8.94
        
        
          %
        
        
        
        
        
        
          10.08
        
        
          %
        
        
        
        
        
        
          9.94
        
        
          %
        
        
        
        
        
        
          10.77
        
        
          %
        
      
      
        
          Return on average assets (1)
        
        
        
        
        
        
          (2.74
        
        
          %)
        
        
        
        
        
        
          1.03
        
        
          %
        
        
        
        
        
        
          (0.16
        
        
          %)
        
        
        
        
        
        
          1.45
        
        
          %
        
      
      
        
          Return on average shareholders’ equity (1)
        
        
        
        
        
        
          (15.59
        
        
          %)
        
        
        
        
        
        
          6.46
        
        
          %
        
        
        
        
        
        
          (0.94
        
        
          %)
        
        
        
        
        
        
          8.72
        
        
          %
        
      
      
        
          Consolidated capital to assets ratio
        
        
        
        
        
        
          17.74
        
        
          %
        
        
        
        
        
        
          16.01
        
        
          %
        
        
        
        
        
        
          17.74
        
        
          %
        
        
        
        
        
        
          16.01
        
        
          %
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
    
    
      _____________________________________
    
    
      (1) Quarterly information is annualized for comparability with full year 
      information.
    
    
      (2) Excluding restructuring charges and other non-recurring charges.