8. Related Party Transactions

AFFILIATE LENDING

Note Receivable from Parent

SLFC’s note receivable from SLFI is payable in full on May 31, 2022, and SLFC may demand payment at any time prior to May 31, 2022; however, SLFC does not anticipate the need for additional liquidity during 2013 and does not expect to demand payment from SLFI in 2013. The note receivable from SLFI totaled $538.0 million at March 31, 2013 and December 31, 2012. Interest receivable on this note totaled $1.5 million at March 31, 2013 and December 31, 2012. The interest rate for the unpaid principal balance is the prime rate. Interest revenue on the note receivable from SLFI totaled $4.3 million for the three months ended March 31, 2013 and 2012.

Receivables from Parent and Affiliates

At March 31, 2013 and December 31, 2012, receivables from our parent and affiliates totaled $16.6 million and $16.2 million, respectively, primarily due to a receivable from Second Street Funding Corporation, a subsidiary of SLFI, for income taxes payable under current and prior tax sharing agreements, which were paid by SLFC. The receivables from our parent and affiliates also include interest receivable on SLFC’s note receivable from SLFI discussed above.

CASH COLLATERAL

In August 2012, Springleaf Financial Services of South Carolina, Inc. (SLFSSC), a subsidiary of SLFC, and SLFI entered into a Reimbursement Agreement (the Reimbursement Agreement) and a related Fee Agreement whereby SLFI agreed to post $25.0 million of cash collateral on behalf of SLFSSC in connection with a judgment entered against SLFSSC, subject to SLFSSC’s agreement to repay the collateral in full in the event it was applied to the judgment and to pay a fee equal to an annual rate of 8.00% of the average monthly amount of unreimbursed collateral until fully repaid. SLFSSC agreed to settle the litigation in late August 2012.

In December 2012, SLFSSC and SLFI amended the Reimbursement Agreement and the Fee Agreement to provide that the collateral could be applied toward the settlement and that SLFI would pay up to an additional $11.0 million toward the settlement on behalf of SLFSSC, subject to SLFSSC’s agreement to repay such amounts in full and to pay a fee equal to an annual rate of 8.00% of the average monthly amount paid by SLFI toward the settlement until fully repaid. Subsequently, SLFI paid an additional $5.8 million in December 2012, on SLFSSC’s behalf, to satisfy the remaining portion of the settlement. At December 31, 2012, the payable to SLFI totaled $30.8 million, and interest payable to SLFI totaled $0.1 million.

In February 2013, SLFI paid an additional $3.1 million, on SLFSSC’s behalf, towards the payment of unclaimed funds to South Carolina charities. In late March 2013, SLFSSC fully repaid SLFI for the cash collateral. During the three months ended March 31, 2013, SLFSSC paid SLFI $0.6 million of fees under the amended Fee Agreement.

CAPITAL CONTRIBUTIONS

On each of January 10, 2012 and January 11, 2013, SLFC received capital contributions from SLFI of $10.5 million to satisfy SLFC’s hybrid debt semi-annual interest payments due in January 2012 and 2013, respectively.

DERIVATIVES

As discussed in Note 7, SLFI posted $60.0 million of cash collateral with AIGFP as security for SLFC’s two remaining Euro swap positions with AIGFP in July 2012, and in August 2012, one of the swap positions was terminated and the cash collateral was reduced by $20.0 million. Fees payable to SLFI totaled $0.3 million at March 31, 2013 and December 31, 2012. During the three months ended March 31, 2013, SLFC paid SLFI $1.0 million of collateral and guarantee fees.

INTERCOMPANY AGREEMENTS

On December 24, 2012, Springleaf General Services Corporation (SGSC), a subsidiary of SLFI, entered into the following intercompany agreements with Springleaf Finance Management Corporation (SFMC), a subsidiary of SLFC, and with certain other subsidiaries of SLFI (collectively, the “Recipients”):

Services Agreement

SGSC provides the following services to the Recipients: management and administrative services; financial, accounting, treasury, tax, and audit services; facilities support services; capital funding services; legal services; human resources services (including payroll); centralized collections and lending support services; insurance, risk management, and marketing services; and information technology services. The fees payable by each Recipient to SGSC is equal to 100% of the allocated cost of providing the services to such Recipient. SGSC allocates its cost of providing these services among the Recipients and any of the companies to which it provides similar services based on an allocation method defined in the agreement. SFMC recorded $32.8 million of service fee expenses for the three months ended March 31, 2013, which are included in other operating expenses. Services fees payable to SGSC totaled $7.8 million at March 31, 2013 and $1.9 million at December 31, 2012.

License Agreement

The agreement provides for use by SGSC of SFMC’s information technology systems and software and other related equipment. The monthly license fee payable by SGSC for its use of the information technology systems and software is 100% of the actual costs incurred by SFMC plus a 7% margin. The fee payable by SGSC for its use of the related equipment is 100% of the actual costs incurred by SFMC. During the three months ended March 31, 2013, SFMC recorded $1.5 million of license fees as a contra expense to other operating expenses.

Building Lease

The agreement provides that SFMC will lease six of its buildings to SGSC for an annual rental amount of $3.7 million, plus additional rental amounts to cover other sums and charges, including real estate taxes, water charges, and sewer rents. During the three months ended March 31, 2013, SFMC recorded $1.0 million of rent charged to SGSC as a contra expense to other operating expenses.