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Investment in receivables, net

12 Months Ended

Dec. 31, 2025

Investment in receivables, net

Investment in receivables, net

5.Investment in receivables, net

The following table presents the roll forward of the balance of the investment in receivables, net for the following years (in thousands):


		For the Year Ended
		December 31,
		2025			2024
Balance, beginning of year		$	1,497,748		$	984,496
Purchases			832,077			723,253
Cash collections			(998,637)			(584,559)
Total portfolio income			560,416			396,304
Changes in expected current period recoveries			8,089			12,522
Changes in expected future period recoveries			(2,088)			(12,941)
Foreign currency adjustments			31,137			(21,327)
Balance, end of year		$	1,928,742		$	1,497,748

The table below provides the detail on the establishment of negative allowance for expected recoveries of portfolios purchased during the years presented (in thousands):


		For the Year Ended
		December 31,
		2025			2024
Purchase price		$	832,077		$	497,189
Allowance for credit losses			11,496,126			8,161,280
Amortized cost			12,328,203			8,658,469
Noncredit discount			702,539			540,042
Face value			13,030,742			9,198,511
Write-off of amortized cost			(12,328,203)			(8,658,469)
Write-off of noncredit discount			(702,539)			(540,042)
Negative allowance			832,077			497,189
Negative allowance for expected recoveries		$	832,077		$	497,189

For the year ended December 31, 2025, the Company purchased receivable portfolios with face values of $13,030.7 million for a purchase price of $832.1 million or 6.4% of face value. For the year ended December 31, 2024, the Company purchased receivable portfolios with face values of $9,198.5 million for a purchase price of $723.3 million or 7.9% of face value. The price paid relative to the face amount of receivables will vary based upon the type of debt purchased, the age of the debt at the time of acquisition and the overall debt acquisition market. The percentage reported represents the weighted average of activity for the year and is a function of the mix of assets acquired in any year. For the receivables purchased in the years ended December 31, 2025 and 2024, the estimated amount of cash flows to be collected were $1,534.6 million and $1,423.4 million (as of purchase), respectively.

Recoveries above or below forecast represent over and under-performance in the reporting period, respectively. Actual collections during the years ended December 31, 2025, and 2024, overperformed the projected collections by approximately $8.1 million and $12.5 million, respectively, primarily driven by continued strong collection performance.

When reassessing the forecasts of expected lifetime recoveries during the year ended December 31, 2025, management considered historical and current collection performance and believes that for certain static pools sustained collections underperformance resulted in decreased total expected recoveries. As a result, the Company has updated its forecast, resulting in a net decrease of total estimated remaining collections, which in turn, when discounted to present value, resulted in a change in expected future period recoveries of approximately $2.1 million and $12.9 million during the years ended December 31, 2025, and 2024, respectively.

At the time of the Bluestem portfolio purchase, which consisted primarily of performing receivables, the Company established an allowance for credit losses of $304.8 million. Additionally, the Company also established a non-credit premium of $93.4 million at the time of purchase

At the time of the Conn’s portfolio purchase, which consisted primarily of performing receivables, the Company established an allowance for credit losses of $251.3 million. Additionally, due to the discount paid to face value on the portfolio, the Company also established a non-credit discount of $89.3 million at the time of purchase.

The Company places performing receivables on nonaccrual status when the receivables are greater than 90 days. To facilitate the monitoring of credit quality for performing receivables, and for the purpose of determining an appropriate allowance for losses for these receivables, the Company utilizes payment history and current payment status. The table below presents the information on the past due and non-accrual buckets for the assets acquired in the Conn’s portfolio purchase, and does not include all other purchased loans as they were charged-off at the time of purchase, as of December 31, 2025 and 2024 (in thousands):




Delinquency vintage		2025			2024
United States
Current		$	326,381		$	352,403
30-59			49,467			33,683
60-89			39,402			29,685
>90			109,562			121,337
Total		$	524,812		$	537,108

The following table presents non-accrual performing loans by segment as of December 31, 2025 and 2024 (in thousands):


		2025						2024
					Nonaccrual						Nonaccrual
					with No						with No
		Nonaccrual			Allowance			Nonaccrual			Allowance
United States			109,562			—			121,337			—
Total		$	109,562		$	—		$	121,337		$	—