v3.23.2

Securitizations and Variable Interest Entities | 6 Months Ended
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Jun. 30, 2023
Transfers and Servicing [Abstract] |
Securitization and Variable Interest Entities | Securitizations and Variable Interest Entities VIE Assets and Liabilities The following table presents the classifications of assets and liabilities on the Company’s Balance Sheet for its transactions with consolidated and unconsolidated VIEs. The Company’s transactions with VIEs include Structured Program transactions. The Company has also various forms of involvement with VIEs, including servicing loans and holding senior or subordinated interests in the VIEs. Additionally, the assets and liabilities in the table below exclude intercompany balances that were eliminated in consolidation.
| June 30, 2023 |  | December 31, 2022
| Consolidated |  | Unconsolidated |  | Total |  | Consolidated |  | Unconsolidated |  | Total
Assets |  |  |  |  |  |  |  |  |  |  |
Restricted cash | $ | 4,330 |  |  | $ | — |  |  | $ | 4,330 |  |  | $ | 8,048 |  |  | $ | — |  |  | $ | 8,048 |
Securities available for sale at fair value | — |  |  | 160,905 |  |  | 160,905 |  |  | — |  |  | 17,717 |  |  | 17,717 |
Loans held for investment at fair value | 1,753 |  |  | — |  |  | 1,753 |  |  | 3,994 |  |  | — |  |  | 3,994 |
Retail and certificate loans held for investment at fair value | 932 |  |  | — |  |  | 932 |  |  | 1,946 |  |  | — |  |  | 1,946 |
Other assets | 23 |  |  | 11,695 |  |  | 11,718 |  |  | 206 |  |  | 10,464 |  |  | 10,670 |
Total assets | $ | 7,038 |  |  | $ | 172,600 |  |  | $ | 179,638 |  |  | $ | 14,194 |  |  | $ | 28,181 |  |  | $ | 42,375 |
Liabilities |  |  |  |  |  |  |  |  |  |  |
Borrowings | $ | 4,460 |  |  | $ | — |  |  | $ | 4,460 |  |  | $ | 8,085 |  |  | $ | — |  |  | $ | 8,085 |
Retail notes, certificates and secured borrowings at fair value | 932 |  |  | — |  |  | 932 |  |  | 1,946 |  |  | — |  |  | 1,946 |
Other liabilities | 9 |  |  | — |  |  | 9 |  |  | 29 |  |  | — |  |  | 29 |
Total liabilities | 5,401 |  |  | — |  |  | 5,401 |  |  | 10,060 |  |  | — |  |  | 10,060 |
Total net assets (maximum loss exposure) | $ | 1,637 |  |  | $ | 172,600 |  |  | $ | 174,237 |  |  | $ | 4,134 |  |  | $ | 28,181 |  |  | $ | 32,315 |
Maximum loss exposure represents estimated loss that would be incurred under severe, hypothetical circumstances, for which the Company believes the possibility is extremely remote, such as where the value of interests and any associated collateral declines to zero. Accordingly, this required disclosure is not an indication of expected losses. Unconsolidated VIEs The following table summarizes activity related to unconsolidated VIEs where the transfers were accounted for as a sale on the Company’s financial statements:
|  |  | Three Months Ended June 30, |  | Six Months Ended June 30,
|  |  | 2023 |  | 2022 |  | 2023 |  | 2022
Fair value of consideration received: |  |  |  |  |  |  |  |  |
Cash |  |  | $ | 18,051 |  |  | $ | — |  |  | $ | 18,051 |  |  | $ | 5,320 |
Asset-backed securities retained |  |  | 153,229 |  |  | — |  |  | 153,229 |  |  | 2,180 |
Other assets (liabilities) |  |  | 2,299 |  |  | — |  |  | 2,299 |  |  | (3,794) |
Total consideration |  |  | 173,579 |  |  | — |  |  | 173,579 |  |  | 3,706 |
Deconsolidation of debt |  |  | — |  |  | — |  |  | — |  |  | 36,072 |
Fair value of loans sold |  |  | (171,559) |  |  | — |  |  | (171,559) |  |  | (39,519) |
Gain on sales of loans (1) |  |  | $ | 2,020 |  |  | $ | — |  |  | $ | 2,020 |  |  | $ | 259 |
Cash proceeds from continuing involvement: |  |  |  |  |  |  |  |  |
Servicing and other administrative fees |  |  | $ | 862 |  |  | $ | 2,407 |  |  | $ | 1,876 |  |  | $ | 5,512 |
Interest received on asset-backed securities retained |  |  | $ | 2,406 |  |  | $ | 2,384 |  |  | $ | 3,594 |  |  | $ | 5,079 |
(1) Consists of servicing assets recognized at the time of sale, less any transaction costs, and excludes origination fees and fair value adjustments recognized prior to the sale. Prior period amounts have been reclassified to conform to the current period presentation. Beginning in the second quarter of 2023, the Company resumed its sponsoring of Structured Program transactions in which it retains the senior securities at a contractual interest rate, in addition to the amount required pursuant to the U.S. Risk Retention Rules, and sells the residual certificates. See “Note 4. Securities Available for Sale” for the securities retained in the Company’s investment portfolio related to such transactions. Holders of the senior securities issued by the unconsolidated VIEs have rights to their contractual cash flows prior to those that hold subordinated interests. There is no direct recourse to the Company’s assets, and holders of the securities can look only to those assets of the VIEs that issued their securities for payment. The beneficial interests are subject principally to the credit and prepayment risk stemming from the underlying unsecured personal loans. As of June 30, 2023, the aggregate unpaid principal balance held by unconsolidated VIEs was $400.5 million, of which $7.9 million was attributable to off-balance sheet loans that were 31 days or more past due. As of December 31, 2022, the aggregate unpaid principal balance held by unconsolidated VIEs was $433.5 million, of which $14.8 million was attributable to off-balance sheet loans that were 31 days or more past due. For such loans, the Company would only experience a loss if it was required to repurchase a loan due to a breach in representations and warranties associated with its loan sale or servicing contracts.

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- Definition The entire disclosure for a transferor's continuing involvement in financial assets that it has transferred in a securitization or asset-backed financing arrangement, the nature of any restrictions on assets reported by an entity in its statement of financial position that relate to a transferred financial asset (including the carrying amounts of such assets), how servicing assets and servicing liabilities are reported, and (for securitization or asset-backed financing arrangements accounted for as sales) when a transferor has continuing involvement with the transferred financial assets and transfers of financial assets accounted for as secured borrowings, how the transfer of financial assets affects an entity's financial position, financial performance, and cash flows. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 860 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 1A -Subparagraph (b)(2) -Publisher FASB -URI 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