Allowance for Finance Receivable Losses (Tables)

3 Months Ended

Mar. 31, 2013

Allowance for Finance Receivable Losses

Schedule of changes in the allowance for finance receivable losses by finance receivable type

	Personal			Retail			Real			Consolidated
(dollars in thousands)	Loans			Sales Finance			Estate Loans			Total
Three Months Ended
March 31, 2013
Balance at beginning of period	$	66,580		$	2,260		$	111,296		$	180,136
Provision for finance receivable losses	25,021			390			70,674			96,085
Charge-offs (a)	(42,769		)	(3,327		)	(34,231		)	(80,327		)
Recoveries	9,088			2,327			2,436			13,851
Balance at end of period	$	57,920		$	1,650		$	150,175		$	209,745
Three Months Ended
March 31, 2012
Balance at beginning of period	$	39,522		$	1,007		$	31,471		$	72,000
Provision for finance receivable losses	21,229			3,778			42,175			67,182
Charge-offs	(29,916		)	(6,508		)	(40,764		)	(77,188		)
Recoveries	9,073			3,030			2,346			14,449
Transfers to finance receivables held for sale (b)	(1,107		)	(194		)	-			(1,301		)
Balance at end of period	$	38,801		$	1,113		$	35,228		$	75,142

(a) Effective March 31, 2013, we charge off to the allowance for finance receivable losses personal loans that are 180 days past due. Previously, we charged off to the allowance for finance receivable losses personal loans on which payments received in the prior six months totaled less than 5% of the original loan amount. As a result of this change, we recorded $12.9 million of additional charge-offs in March 2013.

(b) During the first quarter of 2012, we decreased the allowance for finance receivable losses as a result of the transfers of $77.8 million of finance receivables from finance receivables held for investment to finance receivables held for sale due to management’s intent to no longer hold these finance receivables for the foreseeable future.

Schedule of allowance for finance receivable losses and net finance receivables by type and by impairment method

	Personal		Retail		Real
(dollars in thousands)	Loans		Sales Finance		Estate Loans		Total
March 31, 2013
Allowance for finance receivable losses for finance receivables:
Collectively evaluated for impairment	$	57,920	$	1,650	$	1,560	$	61,130
Acquired with deteriorated credit quality (purchased credit impaired finance receivables)	-		-		29,145		29,145
Individually evaluated for impairment (TDR finance receivables)	-		-		119,470		119,470
Total	$	57,920	$	1,650	$	150,175	$	209,745
Finance receivables:
Collectively evaluated for impairment	$	2,648,161	$	170,921	$	6,270,390	$	9,089,472
Purchased credit impaired finance receivables	-		-		1,370,094		1,370,094
TDR finance receivables	-		-		967,900		967,900
Total	$	2,648,161	$	170,921	$	8,608,384	$	11,427,466
December 31, 2012
Allowance for finance receivable losses for finance receivables:
Collectively evaluated for impairment	$	66,580	$	2,260	$	1,600	$	70,440
Purchased credit impaired finance receivables	-		-		16,973		16,973
TDR finance receivables	-		-		92,723		92,723
Total	$	66,580	$	2,260	$	111,296	$	180,136
Finance receivables:
Collectively evaluated for impairment	$	2,649,732	$	208,357	$	6,641,453	$	9,499,542
Purchased credit impaired finance receivables	-		-		1,390,765		1,390,765
TDR finance receivables	-		-		806,420		806,420
Total	$	2,649,732	$	208,357	$	8,838,638	$	11,696,727