Market Overview

OneMain Holdings, Inc. Reports Second Quarter 2018 Results

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2Q 2018 GAAP diluted EPS of $0.05;2Q 2018 C&I adjusted EPS of $1.18

OneMain Holdings, Inc. (NYSE:OMF) today reported pretax income of $43
million and net income of $7 million for the second quarter of 2018,
compared to $66 million and $42 million, respectively, in the prior year
quarter. In connection with the completion of Fortress Investment Group
LLC's sale of its stake in the company to funds managed by Apollo Global
Management, LLC (NYSE:APO) and Värde Partners, Inc. on June 25, 2018,
net income for the second quarter of 2018 included a charge of
approximately $106 million, reflecting a distribution to certain
executive officers as a result of their ownership interests in
Springleaf Financial Holdings, LLC ("SFH"), the entity which held the
Fortress ownership stake. Although the distribution was not made by
OneMain ("the company") or its subsidiaries, in accordance with
applicable accounting guidance, the company recorded the SFH
distribution as a non-cash incentive expense with an equal and
offsetting increase to additional paid-in capital. Accordingly, the
impact to the company was non-cash, equity neutral and not tax
deductible.

Earnings per diluted share were $0.05 in the second quarter of 2018,
compared to $0.30 in the prior year quarter.

"During the second quarter, we continued to make great progress across
our full year 2018 strategic priorities," said Jay Levine, President and
CEO of OneMain Holdings, Inc. "Finance receivables continued to grow in
a disciplined manner, supported by further growth of our portfolio's
secured lending mix and consistent risk-adjusted returns. Credit
performance continued to strengthen and we achieved operating leverage
while reinvesting in our business. We look forward to building on this
strong financial performance throughout the remainder of 2018."

The following segment results are reported on a non-GAAP basis. Refer
to the required reconciliations of non-GAAP to comparable GAAP measures
at the end of this press release.

Consumer and Insurance Segment ("C&I")

C&I generated adjusted pretax income of $211 million and adjusted net
income of $160 million for the second quarter of 2018, compared to $174
million and $110 million, respectively, in the prior year quarter.
Adjusted earnings per diluted share were $1.18 for the second quarter of
2018, compared to $0.81 in the prior year quarter.

Originations totaled $3.2 billion in the second quarter of 2018, up 8.9%
from $3.0 billion in the prior year quarter. The percentage of secured
originations was 47% in the second quarter of 2018, consistent with 47%
in the prior year quarter.

Ending net finance receivables reached $15.4 billion at June 30, 2018,
up 11% from $13.9 billion in the prior year quarter. Secured receivables
represented $1.3 billion of the $1.6 billion increase in ending net
finance receivables from the prior year quarter.

Average net finance receivables were $15.1 billion in the second quarter
of 2018, up 12% from $13.5 billion in the prior year quarter.

Secured receivables represented 44% of ending net finance receivables at
June 30, 2018, up from 40% in the prior year quarter.

Interest income in the second quarter of 2018 was $911 million, up from
$801 million in the prior year quarter, largely reflecting the impact of
higher average receivables.

Yield was 24.1% in the second quarter of 2018, up from 23.9% in the
prior year quarter, primarily due to the company's ongoing pricing
initiatives that more than offset the impact of growth in lower yielding
secured loans.

Provision for loan losses was $261 million in the second quarter of
2018, up from $234 million in the prior year quarter.

The 30-89 day delinquency ratio was 2.1% at June 30, 2018, consistent
with 2.1% at March 31, 2018 and 2.1% at June 30, 2017.

The 90+ day delinquency ratio was 1.9% at June 30, 2018, down from 2.3%
at March 31, 2018 and 2.1% at June 30, 2017.

The net charge-off ratio was 6.6% in the second quarter of 2018, down
from 7.2% in the first quarter of 2018 and 6.9% in the prior year
quarter.

Acquisitions and Servicing Segment ("A&S")

A&S broke even in the second quarter of 2018 on an adjusted pretax
income basis, consistent with breaking even in the prior year quarter.

Other

During the second quarter of 2018, Other generated an adjusted pretax
loss of $3 million, compared to an adjusted pretax loss of $8 million in
the prior year quarter.

Funding, Capital and Liquidity

During the quarter ended June 30, 2018, the company issued $900 million
of unsecured debt due 2026 at a cost of funds of 7.125%. The company
also redeemed $800 million of its outstanding 7.25% senior notes due
2021. At period end, the company had principal debt balances outstanding
of $15.4 billion, 53% of which was secured and 47% of which was
unsecured.

As of June 30, 2018, the company had $556 million of cash and cash
equivalents, which included $271 million of cash and cash equivalents
held at our regulated insurance subsidiaries or for other operating
activities that is unavailable for general corporate purposes. The
company had undrawn revolving conduit facilities of $5.4 billion and
$6.2 billion of unencumbered consumer loans at June 30, 2018.

Use of Non-GAAP Financial Measures

We report the operating results of Consumer and Insurance, Acquisitions
and Servicing, and Other using the Segment Accounting Basis, which (i)
reflects our allocation methodologies for certain costs, primarily
interest expense, loan loss reserves, and acquisition costs, to reflect
the manner in which we assess our business results and (ii) excludes the
impact of applying purchase accounting (eliminates premiums/discounts on
our finance receivables and long-term debt at acquisition, as well as
the amortization/accretion in future periods). Consumer and Insurance
adjusted pretax income (loss), Consumer and Insurance adjusted net
income (loss), Consumer and Insurance adjusted earnings (loss) per
diluted share, Acquisitions and Servicing adjusted pretax income (loss),
and Other adjusted pretax income (loss) are key performance measures
used by management in evaluating the performance of our business.
Consumer and Insurance adjusted pretax income (loss), Acquisitions and
Servicing adjusted pretax income (loss), and Other adjusted pretax
income (loss) represents income (loss) before income taxes on a Segment
Accounting Basis and excludes acquisition-related transaction and
integration expenses, net gain (loss) on sale of personal and real
estate loans, net gain on sale of SpringCastle interests, SpringCastle
transaction costs, losses resulting from repurchases and repayments of
debt, debt refinance costs, net loss on liquidation of our United
Kingdom subsidiary, non-cash incentive compensation expense, and income
attributable to non-controlling interests. Management believes these
non-GAAP financial measures are useful in assessing the profitability of
our segments and uses these non-GAAP financial measures in evaluating
our operating performance and as a performance goal under the company's
executive compensation programs. These non-GAAP financial measures
should be considered supplemental to, but not as a substitute for or
superior to, income (loss) before income taxes, net income, or other
measures of financial performance prepared in accordance with GAAP.

Conference Call & Webcast Information

OneMain management will host a conference call and webcast to discuss
our second quarter 2018 results and other general matters at 8:00 am
Eastern Time on Tuesday, July 31, 2018. Both the call and webcast are
open to the general public. The general public is invited to listen to
the call by dialing 877-330-3668 (U.S. domestic) or 678-304-6859
(international), and using conference ID 2278727, or via a live audio
webcast through the Investor Relations section of the website. For those
unable to listen to the live broadcast, a replay will be available on
our website, or by dialing 800-585-8367 (U.S. domestic) or 404-537-3406,
and using conference ID 2278727, beginning approximately two hours after
the event. The replay of the conference call will be available via audio
webcast through August 14, 2018. An investor presentation will be
available on the Investor Relations page of OneMain's website at https://www.omf.com
prior to the start of the conference call.

This document contains summarized information concerning OneMain
Holdings, Inc. (the "Company") and the Company's business, operations,
financial performance and trends. No representation is made that the
information in this document is complete. For additional financial,
statistical and business related information, as well as information
regarding business and segment trends, see the Company's most recent
Annual Report on Form 10-K ("Form 10-K") and Quarterly Reports on Form
10-Q ("Form 10-Qs") filed with the U.S. Securities and Exchange
Commission (the "SEC"), as well as the Company's other reports filed
with the SEC from time to time. Such reports are or will be available in
the Investor Relations section of the Company's website (
https://www.omf.com)
and the SEC's website (
https://www.sec.gov).

Cautionary Note Regarding Forward-Looking Statements

This document contains "forward-looking statements" within the meaning
of the Private Securities Litigation Reform Act of 1995. Forward-looking
statements are not statements of historical fact but instead represent
only management's current beliefs regarding future events. By their
nature, forward-looking statements involve inherent risks, uncertainties
and other important factors that may cause actual results, performance
or achievements to differ materially from those expressed in or implied
by such forward-looking statements. We caution you not to place undue
reliance on these forward-looking statements that speak only as of the
date they were made. We do not undertake any obligation to publicly
release any revisions to these forward-looking statements to reflect
events or circumstances after the date of this document or to reflect
the occurrence of unanticipated events or the non-occurrence of
anticipated events. Forward-looking statements include, without
limitation, statements concerning future plans, objectives, goals,
projections, strategies, events or performance, and underlying
assumptions and other statements related thereto. Statements preceded
by, followed by or that otherwise include the words "anticipates,"
"appears," "are likely," "believes," "estimates," "expects," "foresees,"
"intends," "plans," "projects" and similar expressions or future or
conditional verbs such as "would," "should," "could," "may," or "will,"
are intended to identify forward-looking statements. Important factors
that could cause actual results, performance or achievements to differ
materially from those expressed in or implied by forward-looking
statements include, without limitation, the following: the inability to
obtain, or delays in obtaining, cost savings and synergies from the
OneMain Acquisition and risks and other uncertainties associated with
the integration of the companies; any litigation, fines or penalties
that could arise relating to the OneMain Acquisition or the Apollo
Transaction; effects, if any, of the impact of the Apollo Transaction,
including effects on our business or operational strategies, goals or
objectives or our relationships with our employees or third parties;
various risks relating to our continued compliance with the previously
disclosed Settlement Agreement with the U.S. Department of Justice;
changes in general economic conditions, including the interest rate
environment in which we conduct business and the financial markets
through which we can access capital and also invest cash flows from our
Consumer and Insurance segment; levels of unemployment and personal
bankruptcies; natural or accidental events such as earthquakes,
hurricanes, tornadoes, fires, or floods affecting our customers,
collateral, or branches or other operating facilities; war, acts of
terrorism, riots, civil disruption, pandemics, disruptions in the
operation of our information systems, or other events disrupting
business or commerce; effects on our business, reputation and our
financial position, results of operations and cash flows of any
cyberbreach or other cyber-related incident involving our information
systems or the loss, theft or unauthorized disclosure of personally
identifiable information of our present or former customers, including
any costs, fines or penalties incurred in connection therewith not
covered by insurance, whether as a result of litigation, governmental
investigations, business interruption, remediation efforts or otherwise;
changes in the rate at which we can collect or potentially sell our
finance receivables portfolio; the effectiveness of our credit risk
scoring models in assessing the risk of customer unwillingness or lack
of capacity to repay; changes in our ability to attract and retain
employees or key executives to support our businesses; changes in the
competitive environment in which we operate, including the demand for
our products, customer responsiveness to our distribution channels, our
ability to make technological improvements, and the strength and ability
of our competitors to operate independently or to enter into business
combinations that result in a more attractive range of customer products
or provide greater financial resources; risks related to the acquisition
or sale of assets or businesses or the formation, termination or
operation of joint ventures or other strategic alliances or
arrangements, including loan delinquencies or net charge-offs,
integration or migration issues, increased costs of servicing,
incomplete records, and retention of customers; risks associated with
our insurance operations, including insurance claims that exceed our
expectations or insurance losses that exceed our reserves; the inability
to successfully implement our growth strategy for our consumer lending
business as well as various risks associated with successfully acquiring
portfolios of consumer loans, pursuing acquisitions, and/or establishing
joint ventures; declines in collateral values or increases in actual or
projected delinquencies or net charge-offs; changes in federal, state or
local laws, regulations, or regulatory policies and practices, including
the Dodd-Frank Wall Street Reform and Consumer Protection Act (which,
among other things, established the Consumer Financial Protection
Bureau, which has broad authority to regulate and examine financial
institutions, including us), that affect our ability to conduct business
or the manner in which we conduct business, such as licensing
requirements, pricing limitations or restrictions on the method of
offering products, as well as changes that may result from increased
regulatory scrutiny of the sub-prime lending industry, our use of
third-party vendors and real estate loan servicing, or changes in
corporate or individual income tax laws or regulations, including
effects of the enactment of Public Law 115-97 amending the Internal
Revenue Code of 1986; potential liability relating to real estate and
personal loans which we have sold or may sell in the future, or relating
to securitized loans, if it is determined that there was a non-curable
breach of a representation or warranty made in connection with such
transactions; the costs and effects of any actual or alleged violations
of any federal, state or local laws, rules or regulations, including any
litigation associated therewith, any impact to our business operations,
reputation, financial position, results of operations or cash flows
arising therefrom, any impact to our relationships with lenders,
investors or other third parties attributable thereto, and the costs and
effects of any breach of any representation, warranty or covenant under
any of our contractual arrangements, including indentures or other
financing arrangements or contracts, as a result of any such violation;
the costs and effects of any fines, penalties, judgments, decrees,
orders, inquiries, investigations, subpoenas, or enforcement or other
proceedings of any governmental or quasi-governmental agency or
authority and any litigation associated therewith; our continued ability
to access the capital markets or the sufficiency of our current sources
of funds to satisfy our cash flow requirements; our ability to comply
with our debt covenants; our ability to generate sufficient cash to
service all of our indebtedness; any material impairment or write-down
of the value of our assets; the effects of any downgrade of our debt
ratings by credit rating agencies, which could have a negative impact on
our cost of and/or access to capital; our substantial indebtedness,
which could prevent us from meeting our obligations under our debt
instruments and limit our ability to react to changes in the economy or
our industry, or our ability to incur additional borrowings; the impacts
of our securitizations and borrowings; our ability to maintain
sufficient capital levels in our regulated and unregulated subsidiaries;
changes in accounting standards or tax policies and practices and the
application of such new standards, policies and practices; changes in
accounting principles and policies or changes in accounting estimates;
any failure or inability to achieve the SpringCastle Portfolio
performance requirements set forth in the SpringCastle Interests Sale
purchase agreement; the effect of future sales of our remaining
portfolio of real estate loans and the transfer of servicing of these
loans, including the environmental liability and costs for damage caused
by hazardous waste if a real estate loan goes into default; and other
risks and uncertainties described in the "Risk Factors" and
"Management's Discussion and Analysis" sections of the Company's most
recent Form 10-K and Form 10-Qs filed with the SEC and in the Company's
other filings with the SEC from time to time. The foregoing list of
factors that could cause actual results, performance, or achievements to
differ materially from those expressed in or implied by forward-looking
statements does not purport to be complete and new factors, risks and
uncertainties may arise in the future that are impossible for us to
currently predict.

OneMain Holdings, Inc.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
   
Quarter-to-Date Year-to-Date
(unaudited, $ in millions, expect per share amounts) 6/30/18   3/31/18   6/30/17 6/30/18   6/30/17
 
Finance charges $ 902 $ 859 $ 768 $ 1,761 $ 1,524
Finance receivables held for sale originated as held for investment 3   3   4   6   7  
Total interest income 905 862 772 1,767 1,531
 
Interest expense (220 ) (200 ) (203 ) (420 ) (405 )
Provision for finance receivable losses (260 ) (254 ) (236 ) (514 ) (481 )
Net interest income after provision for finance receivable losses 425 408 333 833 645
 
Other revenues:
Insurance 107 105 104 212 207
Investment 19 13 20 32 39
Net loss on repurchases and repayments of debt (7 ) (1 ) (27 ) (8 ) (28 )
Other 21   20   24   41   44  
Total other revenues 140 137 121 277 262
 
Other expenses:
Operating expenses:
Salaries and benefits (306 ) (194 ) (191 ) (500 ) (377 )
Acquisition-related transaction and integration expenses (28 ) (10 ) (14 ) (39 ) (37 )
Other operating expenses (137 ) (128 ) (137 ) (264 ) (279 )
Insurance policy benefits and claims (51 ) (45 ) (46 ) (96 ) (91 )
Total other expenses (522 ) (377 ) (388 ) (899 ) (784 )
Income before income taxes 43 168 66 211 123
Income taxes (36 ) (44 ) (24 ) (80 ) (48 )
Net income $ 7   $ 124   $ 42   $ 131   $ 75  
 
 
Weighted average number of diluted shares 136.0 135.9 135.5 135.9 135.5
GAAP diluted EPS $ 0.05 $ 0.91 $ 0.30 $ 0.96 $ 0.55
Note:   Year-to-Date may not sum due to rounding.
 
OneMain Holdings, Inc.
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
 
As of
   
(unaudited, $ in millions) 6/30/2018 3/31/2018 6/30/2017
 
Cash and cash equivalents $ 556 $ 1,807 $ 862
Investment securities 1,720 1,706 1,750
Net finance receivables:
Personal loans 15,384 14,858 13,908
Other receivables (1) 124   129   142  
Net finance receivables 15,508 14,987 14,050
Unearned insurance premium and claim reserves (611 ) (585 ) (572 )
Allowance for finance receivable losses (702 ) (689 ) (676 )

Net finance receivables, less unearned insurance premium and
claim reserves and allowance for finance receivable losses

14,195 13,713 12,802
Finance receivables held for sale 123 126 141
Restricted cash and restricted cash equivalents 587 679 545
Goodwill 1,422 1,422 1,422
Other intangible assets 409 428 464
Other assets 628   586   712  
Total assets $ 19,640   $ 20,467   $ 18,698  
 
Long-term debt $ 15,054 $ 15,898 $ 14,409
Insurance claims and policyholder liabilities 690 728 745
Deferred and accrued taxes 3 72 5
Other liabilities 404   387   385  
Total liabilities 16,151   17,085   15,544  
 
Common stock 1 1 1
Additional paid-in capital 1,674 1,563 1,552
Accumulated other comprehensive income (loss) (21 ) (12 ) 3
Retained earnings 1,835   1,830   1,598  
Total shareholders' equity 3,489   3,382   3,154  
Total liabilities and shareholders' equity $ 19,640   $ 20,467   $ 18,698  
(1) Other Receivables consist of Real Estate and Retail Sales
Finance, which were reported separately in prior periods.
 
OneMain Holdings, Inc.
CONSOLIDATED KEY FINANCIAL METRICS (UNAUDITED)
 
Quarter Ended
   
(unaudited, $ in millions) 6/30/2018 3/31/2018 6/30/2017
Loans:
Non-TDR Net Finance Receivables $ 15,079 $ 14,582 $ 13,745
TDR Net Finance Receivables 429   405   305  
Total Net Finance Receivables $ 15,508   $ 14,987   $ 14,050  
 
Average Net Receivables $ 15,239 $ 14,986 $ 13,681
Origination Volume 3,216 2,540 2,953
 
Allowance:
Non-TDR Allowance $ 532 $ 524 $ 538
TDR Allowance 170   165   138  
Total Allowance $ 702   $ 689   $ 676  
 
Non-TDR Allowance Ratio 3.5 % 3.6 % 3.9 %
TDR Allowance Ratio 39.6 % 40.7 % 45.2 %
Total Allowance Ratio 4.5 % 4.6 % 4.8 %
 
Gross Charge-Off $ 278 $ 290 $ 255
Recoveries (31 ) (28 ) (29 )
Net Charge-Off $ 247   $ 262   $ 226  
 
Gross Charge-Off Ratio 7.3 % 7.9 % 7.5 %
Recoveries (0.8 )% (0.8 )% (0.8 )%
Net Charge-Off Ratio 6.5 % 7.1 % 6.6 %
 
Delinquency:
30-89 Delinquency $ 338 $ 317 $ 307
30+ Delinquency 647 671 614
60+ Delinquency 445 490 429
90+ Delinquency 309 354 307
 
30-89 Delinquency Ratio 2.2 % 2.1 % 2.2 %
30+ Delinquency Ratio 4.2 % 4.5 % 4.4 %
60+ Delinquency Ratio 2.9 % 3.3 % 3.1 %
90+ Delinquency Ratio 2.0 % 2.4 % 2.2 %
Note: Delinquency ratio is calculated as a percentage of net finance
receivables. Ratios may not sum due to rounding.
 
OneMain Holdings, Inc.
BALANCE SHEET METRICS (UNAUDITED)
 
As of
   
(unaudited, $ in millions) 6/30/2018 3/31/2018 6/30/2017
 
Liquidity
Cash and cash equivalents $ 556 $ 1,807 $ 862
Unencumbered assets (1) 6,196 4,829 4,542
Undrawn conduit facilities 5,350 4,900 4,800
 
Total Assets $ 19,640 $ 20,467 $ 18,698
Less: Goodwill (1,422 ) (1,422 ) (1,422 )
Less: Other intangible assets (409 ) (428 ) (464 )
Tangible Managed Assets $ 17,809   $ 18,617   $ 16,812  
 
Long-term debt $ 15,054 $ 15,898 $ 14,409
Less: Junior subordinated debt (172 ) (172 ) (172 )
Adjusted Debt $ 14,882   $ 15,726   $ 14,237  
 
Total Shareholders' Equity $ 3,489 $ 3,382 $ 3,154
Less: Goodwill (1,422 ) (1,422 ) (1,422 )
Less: Other intangible assets (409 ) (428 ) (464 )
Plus: Junior subordinated debt 172   172   172  
Adjusted Tangible Common Equity $ 1,830   $ 1,704   $ 1,440  
 
Adjusted Debt to Adjusted Tangible Common Equity (Tangible
Leverage)
8.1x 9.2x 9.9x
 
Adjusted Tangible Common Equity to Tangible Managed Assets 10.3 % 9.2 % 8.6 %
(1) Personal loans not pledged as collateral on existing
securitizations.
 
OneMain Holdings, Inc.
CONSOLIDATED RETURN ON RECEIVABLES (UNAUDITED)
 
Quarter Ended
   
(unaudited, $ in millions) 6/30/18 3/31/18 6/30/17
 
Revenue (1) 26.1 % 25.5 % 24.8 %
Net Charge-Off (6.5 )% (7.1 )% (6.6 )%
Risk Adjusted Margin 19.6 % 18.4 % 18.2 %
Operating Expenses (12.4 )% (8.9 )% (10.0 )%
Unlevered Return on Receivables 7.2 % 9.5 % 8.2 %
Interest Expense (5.8 )% (5.3 )% (5.9 )%
Income Tax Expense (0.9 )% (1.2 )% (0.7 )%
Return on Receivables (2) 0.2 % 3.3 % 1.2 %
Note: All ratios are based on Consolidated GAAP results as a
percentage of average net finance receivables held for investment.
Ratios may not sum due to rounding.
(1) Revenue includes interest income on finance receivables plus
other revenues less insurance policy benefits and claims.
(2) Return on receivables includes the change in allowance impact,
net of tax.
 
OneMain Holdings, Inc.
CONSUMER AND INSURANCE SEGMENT (UNAUDITED) (Non-GAAP)
     
Quarter Ended Year-to-Date
   
(unaudited, $ in millions) 6/30/2018 3/31/2018 6/30/2017 6/30/2018 6/30/2017
 
Finance charges $ 911 $ 873 $ 801 $ 1,784 $ 1,599
Finance receivables held for sale          
Total interest income 911 873 801 1,784 1,599
 
Interest expense (212 ) (194 ) (189 ) (406 ) (375 )
Provision for finance receivable losses (261 ) (258 ) (234 ) (519 ) (473 )
Net interest income after provision for finance receivable losses 438 421 378 859 751
 
Insurance 107 105 104 212 207
Investment 20 14 24 34 49
Other 14   14   15   27   25  
Total other revenues 141 133 143 273 281
 
Operating expenses (317 ) (298 ) (300 ) (615 ) (603 )
Insurance policy benefits and claims (51 ) (45 ) (47 ) (96 ) (92 )
Total other expenses (368 ) (343 ) (347 ) (711 ) (695 )
         
Adjusted pretax income (non-GAAP) 211 211 174 421 337
 
Income taxes (1) (51 ) (51 ) (64 ) (101 ) (125 )
         
Adjusted net income (non-GAAP) $ 160   $ 160   $ 110   $ 320   $ 212  
 
Weighted average number of diluted shares 136.0 135.9 135.5 135.9 135.5
C&I adjusted diluted EPS (2) $ 1.18 $ 1.18 $ 0.81 2.36 1.56
Note: Year-to-Date may not sum due to rounding.
(1) Income taxes assume a 37% statutory tax rate for 2017 periods
and 24% for 2018 periods.
(2) C&I adjusted diluted EPS is calculated as the adjusted net
income (non-GAAP) divided by the weighted average number of diluted
shares outstanding.
 
OneMain Holdings, Inc.
CONSUMER AND INSURANCE SEGMENT - CREDIT METRICS (UNAUDITED)
(Non-GAAP)
 
Quarter Ended
   
(unaudited, $ in millions) 6/30/2018 3/31/2018 6/30/2017
 
Loans:
Non-TDR Net Finance Receivables $ 14,899 $ 14,370 $ 13,396
TDR Net Finance Receivables 507   500   460  
Total Net Finance Receivables $ 15,406   $ 14,870   $ 13,856  
 
Average Net Receivables $ 15,130 $ 14,860 $ 13,469
Origination Volume 3,216 2,540 2,953
 
Allowance:
Non-TDR Allowance $ 524 $ 514 $ 511
TDR Allowance 205   204   186  
Total Allowance (1) $ 729   $ 718   $ 697  
 
Non-TDR Allowance Ratio 3.5

 %

3.6

 %

3.8

 %

TDR Allowance Ratio 40.4

 %

40.8

 %

40.4

 %

Total Allowance Ratio 4.7

 %

4.8

 %

5.0

 %

 
Gross Charge-Off $ 285 $ 297 $ 266
Recoveries (35 ) (33 ) (35 )
Net Charge-Off $ 250   $ 264   $ 231  
 
Gross Charge-Off Ratio 7.6

 %

8.1

 %

7.9

 %

Recoveries (0.9 )% (0.9 )% (1.0 )%
Net Charge-Off Ratio 6.6

 %

7.2

 %

6.9

 %

 
Delinquency:
30-89 Delinquency $ 328 $ 310 $ 295
30+ Delinquency 621 648 580
60+ Delinquency 427 473 403
90+ Delinquency 293 338 285
 
30-89 Delinquency Ratio 2.1

 %

2.1

 %

2.1

 %

30+ Delinquency Ratio 4.0

 %

4.4

 %

4.2

 %

60+ Delinquency Ratio 2.8

 %

3.2

 %

2.9

 %

90+ Delinquency Ratio 1.9

 %

2.3

 %

2.1

 %

Note: Consumer & Insurance financial information is presented on an
adjusted Segment Accounting Basis. Delinquency ratios are calculated
as a percentage of net finance receivables. All ratios are shown as
a percentage of C&I average net finance receivables held for
investment. Ratios may not sum due to rounding.
(1) For allowance for finance receivables loss reconciliation to
GAAP, see page 16.
 
OneMain Holdings, Inc.
CONSUMER & INSURANCE SEGMENT METRICS (UNAUDITED) (Non-GAAP)
 
Quarter Ended
   
(unaudited, $ in millions) 6/30/18 3/31/18 6/30/17
 
Revenue (1) 26.4

 %

25.9

 %

26.6

 %

Net Charge-Off (6.6 )% (7.2 )% (6.9 )%
Risk Adjusted Margin 19.8

 %

18.7

 %

19.8

 %

Operating Expenses (8.4

)%

(8.0 )% (8.9 )%
Unlevered Return on Receivables 11.4

 %

10.7

 %

10.9

 %

Interest Expense (5.6 )% (5.2 )% (5.6 )%
Provision for Income Taxes (2) (1.3 )% (1.4 )% (1.9 )%
Return on Receivables (3) 4.2

 %

4.3

 %

3.3

 %

Note: Consumer & Insurance financial information is presented on an
adjusted Segment Accounting Basis. All ratios are shown as a
percentage of C&I average net finance receivables held for
investment. Ratios may not sum due to rounding.
(1) Revenue includes interest income on finance receivables plus
other revenues less insurance policy benefits and claims.
(2) Income taxes assume a 37% statutory tax rate for 2017 and 24%
for 2018.
(3) Return on receivables includes the change in allowance impact,
net of tax.
 
OneMain Holdings, Inc.
ACQUISITIONS AND SERVICING SEGMENT (UNAUDITED) (Non-GAAP)
     
Quarter Ended Year-to-Date
   
(unaudited, $ in millions) 6/30/2018 3/31/2018 6/30/2017 6/30/2018 6/30/2017
 
Portfolio Servicing Fees from SpringCastle $ 8 $ 9 $ 10 $ 17 $ 20
Other         2  
Total Other Revenues 8   9   10   17   22  
Operating Expenses (8 ) (8 ) (10 ) (16 ) (21 )
Total Other Expenses (8 ) (8 ) (10 ) (16 ) (21 )
Adjusted Pretax Income (non-GAAP) $   $ 1   $   $ 1   $ 1  
Note:  

Acquisitions & Servicing results are presented on an adjusted
Segment Accounting Basis.
Year-to-Date may not sum due to
rounding.

 
OneMain Holdings, Inc.
OTHER (UNAUDITED) (Non-GAAP)
  Quarter Ended   Year-to-Date
     
(unaudited, $ in millions) 6/30/2018 3/31/2018 6/30/2017 6/30/2018 6/30/2017
 
Finance Charges $ 3 $ 3 $ 2 $ 5 $ 6
Finance Receivables Held for Sale 2   2   4   4   6  
Total Interest Income 5 5 6 9 12
 
Interest Expense (5 ) (5 ) (5 ) (9 ) (11 )
Provision for Finance Receivable Losses 3   2     5   (1 )
Net Interest Income after Provision for finance receivable losses 3 2 1 5
 
Other   (2 ) 1   (2 ) 1  
Total Other Revenues   (2 ) 1   (2 ) 1  
 
Operating Expenses (6 ) (10 ) (10 ) (16 ) (16 )
Total Other Expenses (6 ) (10 ) (10 ) (16 ) (16 )
 
Adjusted Pretax Income (non-GAAP) $ (3 ) $ (10 ) $ (8 ) $ (13 ) $ (15 )
 
Net Finance Receivables held for investment:
Personal Loans $ $ $ 6 $ $ 6
Other Receivables 131   136   150   131   150  
Total Net Finance Receivables held for investment $ 131   $ 136   $ 156   $ 131   $ 156  
 
Net Finance Receivables held for sale $ 130 $ 133 $ 146 $ 130 $ 146
Note:   Other is presented on an adjusted Segment Accounting Basis.

Effective 1Q17, Real Estate segment was combined with "Other."
Effective 1Q18, Retail Sales Finance and Real Estate receivables
were combined with "Other Receivables." Prior periods have been
revised to conform to the new presentation.

Year-to-Date may not sum due to rounding.
 
OneMain Holdings, Inc.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (UNAUDITED)
     
Quarter Ended Year-to-Date
   
(unaudited, $ in millions) 6/30/18 3/31/18 6/30/17 6/30/18 6/30/17
 
Consumer & Insurance $ 154 $ 174 $ 144 $ 327 $ 286
Acquisitions & Servicing 1 1 1
Other (109 ) (10 ) (8 ) (119 ) (21 )
Segment to GAAP Adjustment (2 ) 3   (70 ) 2   (143 )
Income Before Income Taxes - GAAP basis $ 43   $ 168   $ 66   $ 211   $ 123  
 
Pretax Income - Segment Accounting Basis $ 154 $ 174 $ 144 $ 327 $ 286
Net Loss on Repurchases and Repayments of Debt 35 27 16 62 17
Acquisition-Related Transaction and Integration Expenses 22   10   14   32   34  
Consumer & Insurance Adjusted Pretax Income (non-GAAP) $ 211   $ 211   $ 174   $ 421   $ 337  
 
Pretax Income - Segment Accounting Basis 1 1 1
Adjustments          
Acquisitions & Servicing Adjusted Pretax Income (non-GAAP) $   $ 1   $   $ 1   $ 1  
 
Pretax Loss - Segment Accounting Basis $ (109 ) $ (10 ) $ (8 ) $ (119 ) $ (21 )
Non-Cash Incentive Compensation Expense 106 106
Acquisition-Related Transaction and Integration Expenses         6  
Other Adjusted Pretax Loss (non-GAAP) $ (3 ) $ (10 ) $ (8 ) $ (13 ) $ (15 )
Note:   Year-to-Date may not sum due to rounding.
 
OneMain Holdings, Inc.
RECONCILIATION OF KEY SEGMENT METRICS (UNAUDITED) (Non-GAAP)
 
As of
   
(unaudited, $ in millions) 6/30/18 3/31/18 6/30/17
 
Consumer & Insurance $ 15,406 $ 14,870 $ 13,856
Acquisition & Servicing
Other 131 136 156
Segment to GAAP Adjustment (29 ) (19 ) 38  
Net Finance Receivables Held for Investment - GAAP basis $ 15,508   $ 14,987   $ 14,050  
 
Consumer & Insurance $ 729 $ 718 $ 697
Acquisition & Servicing
Other 30 32 27
Segment to GAAP Adjustment (57 ) (61 ) (48 )
Allowance for Finance Receivable Losses - GAAP basis $ 702   $ 689   $ 676  
 
Consumer & Insurance $ 15,045 $ 15,856 $ 14,323
Acquisition & Servicing
Other 261 269 301
Segment to GAAP Adjustment (252 ) (227 ) (215 )
Long-Term Debt - GAAP basis $ 15,054   $ 15,898   $ 14,409  

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