v3.23.2
Securitizations and Variable Interest Entities
 6 Months Ended
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, 2023December 31, 2022
Consolidated Unconsolidated TotalConsolidatedUnconsolidatedTotal
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 value1,753 — 1,753 3,994 — 3,994 
Retail and certificate loans held for investment at fair value932 — 932 1,946 — 1,946 
Other assets23 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 value932 — 932 1,946 — 1,946 
Other liabilities9 — 9 29 — 29 
Total liabilities5,401 — 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,
2023202220232022
Fair value of consideration received:
Cash$18,051 $— $18,051 $5,320 
Asset-backed securities retained153,229 — 153,229 2,180 
Other assets (liabilities)2,299 — 2,299 (3,794)
Total consideration173,579 — 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.