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Finance Receivables, Credit Quality Information, and Allowance for Credit Losses | 12 Months Ended
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Dec. 31, 2016
Receivables [Abstract] |
Finance Receivables, Credit Quality Information, and Allowance for Credit Losses | Note 4. Finance Receivables, Credit Quality Information, and Allowance for Credit Losses Finance receivables for the periods indicated consisted of the following:
|  | December 31, |
In thousands |  | 2016 |  |  | 2015 |
Small loans |  | $ | 358,471 |  |  | $ | 338,157 |
Large loans |  |  | 235,349 |  |  |  | 146,553 |
Automobile loans |  |  | 90,432 |  |  |  | 116,109 |
Retail loans |  |  | 33,523 |  |  |  | 27,625 |
Finance receivables |  | $ | 717,775 |  |  | $ | 628,444 |
The contractual delinquency of the finance receivable portfolio by product and aging for the periods indicated are as follows:
|  | December 31, 2016 |
|  | Small |  |  | Large |  |  | Automobile |  |  | Retail |  |  | Total |
In thousands |  | $ |  |  | % |  |  | $ |  |  | % |  |  | $ |  |  | % |  |  | $ |  |  | % |  |  | $ |  |  | % |
Current |  | $ | 288,983 |  |  |  | 80.6 | % |  | $ | 204,063 |  |  |  | 86.8 | % |  | $ | 66,936 |  |  |  | 74.0 | % |  | $ | 27,220 |  |  |  | 81.2 | % |  | $ | 587,202 |  |  |  | 81.9 | %
1 to 29 days past due |  |  | 36,533 |  |  |  | 10.2 | % |  |  | 19,172 |  |  |  | 8.1 | % |  |  | 17,196 |  |  |  | 19.0 | % |  |  | 4,205 |  |  |  | 12.5 | % |  |  | 77,106 |  |  |  | 10.7 | %
Delinquent accounts |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
30 to 59 days |  |  | 9,408 |  |  |  | 2.6 | % |  |  | 3,948 |  |  |  | 1.7 | % |  |  | 2,654 |  |  |  | 3.0 | % |  |  | 717 |  |  |  | 2.2 | % |  |  | 16,727 |  |  |  | 2.3 | %
60 to 89 days |  |  | 7,110 |  |  |  | 2.0 | % |  |  | 2,920 |  |  |  | 1.2 | % |  |  | 1,171 |  |  |  | 1.3 | % |  |  | 440 |  |  |  | 1.3 | % |  |  | 11,641 |  |  |  | 1.6 | %
90 to 119 days |  |  | 6,264 |  |  |  | 1.8 | % |  |  | 2,271 |  |  |  | 1.0 | % |  |  | 1,110 |  |  |  | 1.2 | % |  |  | 376 |  |  |  | 1.1 | % |  |  | 10,021 |  |  |  | 1.4 | %
120 to 149 days |  |  | 5,424 |  |  |  | 1.5 | % |  |  | 1,710 |  |  |  | 0.7 | % |  |  | 743 |  |  |  | 0.8 | % |  |  | 328 |  |  |  | 1.0 | % |  |  | 8,205 |  |  |  | 1.1 | %
150 to 179 days |  |  | 4,749 |  |  |  | 1.3 | % |  |  | 1,265 |  |  |  | 0.5 | % |  |  | 622 |  |  |  | 0.7 | % |  |  | 237 |  |  |  | 0.7 | % |  |  | 6,873 |  |  |  | 1.0 | %
Total delinquency |  | $ | 32,955 |  |  |  | 9.2 | % |  | $ | 12,114 |  |  |  | 5.1 | % |  | $ | 6,300 |  |  |  | 7.0 | % |  | $ | 2,098 |  |  |  | 6.3 | % |  | $ | 53,467 |  |  |  | 7.4 | %
Total finance receivables |  | $ | 358,471 |  |  |  | 100.0 | % |  | $ | 235,349 |  |  |  | 100.0 | % |  | $ | 90,432 |  |  |  | 100.0 | % |  | $ | 33,523 |  |  |  | 100.0 | % |  | $ | 717,775 |  |  |  | 100.0 | %
Finance receivables in nonaccrual status |  | $ | 16,437 |  |  |  | 4.6 | % |  | $ | 5,246 |  |  |  | 2.2 | % |  | $ | 2,475 |  |  |  | 2.7 | % |  | $ | 941 |  |  |  | 2.8 | % |  | $ | 25,099 |  |  |  | 3.5 | %
|  | December 31, 2015 |
|  | Small |  |  | Large |  |  | Automobile |  |  | Retail |  |  | Total |
In thousands |  | $ |  |  | % |  |  | $ |  |  | % |  |  | $ |  |  | % |  |  | $ |  |  | % |  |  | $ |  |  | % |
Current |  | $ | 270,635 |  |  |  | 80.1 | % |  | $ | 127,374 |  |  |  | 86.9 | % |  | $ | 79,878 |  |  |  | 68.8 | % |  | $ | 22,704 |  |  |  | 82.2 | % |  | $ | 500,591 |  |  |  | 79.7 | %
1 to 29 days past due |  |  | 37,337 |  |  |  | 11.0 | % |  |  | 14,234 |  |  |  | 9.7 | % |  |  | 27,518 |  |  |  | 23.7 | % |  |  | 3,500 |  |  |  | 12.7 | % |  |  | 82,589 |  |  |  | 13.1 | %
Delinquent accounts |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
30 to 59 days |  |  | 8,841 |  |  |  | 2.6 | % |  |  | 2,157 |  |  |  | 1.5 | % |  |  | 4,119 |  |  |  | 3.5 | % |  |  | 537 |  |  |  | 1.9 | % |  |  | 15,654 |  |  |  | 2.5 | %
60 to 89 days |  |  | 6,430 |  |  |  | 1.9 | % |  |  | 1,153 |  |  |  | 0.8 | % |  |  | 1,959 |  |  |  | 1.7 | % |  |  | 316 |  |  |  | 1.1 | % |  |  | 9,858 |  |  |  | 1.6 | %
90 to 119 days |  |  | 5,620 |  |  |  | 1.6 | % |  |  | 682 |  |  |  | 0.4 | % |  |  | 1,147 |  |  |  | 1.0 | % |  |  | 247 |  |  |  | 1.0 | % |  |  | 7,696 |  |  |  | 1.1 | %
120 to 149 days |  |  | 4,928 |  |  |  | 1.5 | % |  |  | 574 |  |  |  | 0.4 | % |  |  | 1,003 |  |  |  | 0.9 | % |  |  | 173 |  |  |  | 0.6 | % |  |  | 6,678 |  |  |  | 1.1 | %
150 to 179 days |  |  | 4,366 |  |  |  | 1.3 | % |  |  | 379 |  |  |  | 0.3 | % |  |  | 485 |  |  |  | 0.4 | % |  |  | 148 |  |  |  | 0.5 | % |  |  | 5,378 |  |  |  | 0.9 | %
Total delinquency |  | $ | 30,185 |  |  |  | 8.9 | % |  | $ | 4,945 |  |  |  | 3.4 | % |  | $ | 8,713 |  |  |  | 7.5 | % |  | $ | 1,421 |  |  |  | 5.1 | % |  | $ | 45,264 |  |  |  | 7.2 | %
Total finance receivables |  | $ | 338,157 |  |  |  | 100.0 | % |  | $ | 146,553 |  |  |  | 100.0 | % |  | $ | 116,109 |  |  |  | 100.0 | % |  | $ | 27,625 |  |  |  | 100.0 | % |  | $ | 628,444 |  |  |  | 100.0 | %
Finance receivables in nonaccrual status |  | $ | 14,914 |  |  |  | 4.4 | % |  | $ | 1,635 |  |  |  | 1.1 | % |  | $ | 2,635 |  |  |  | 2.3 | % |  | $ | 568 |  |  |  | 2.1 | % |  | $ | 19,752 |  |  |  | 3.1 | %
The allowance for credit losses consists of general and specific components. Prior to September 30, 2016, the general component estimated credit losses for groups of finance receivables on a collective basis and was primarily based on historical loss rates (adjusted for qualitative factors). Effective September 30, 2016 and forward, it is primarily based on delinquency roll rates. Delinquency roll rate modeling is forward-looking and common practice in the consumer finance industry. As a result of this change, the Company decreased the provision for credit losses for the year ended December 31, 2016 by $0.5 million, which increased net income by $0.3 million, or $0.03 diluted earnings per share. In September 2014, the Company changed the time-based element of the charge-off policy from 365 days contractually delinquent to 180 days. The updated policy improves consistency and creates better alignment with industry practice. The policy change generated a one-time credit loss of $2.1 million as of September 2014. Prior to the charge-off policy change, the specific component of the allowance for credit losses included a full valuation allowance for finance receivables that were contractually delinquent 180 days or more. The $2.1 million in credit losses from the policy change were charged against this allowance as of September 2014 and, therefore, did not impact the provision for credit losses. Prior to September 30, 2016, the general component of the allowance estimated credit losses for groups of finance receivables on a collective basis and was primarily based on historical loss rates. The September 2014 charge-off policy change modified this historical loss rate and the resulting general reserve. In addition, the Company converted bankrupt accounts with confirmed plans from the bankruptcy court from delinquent to current status. The bankrupt accounts continue to be accounted for as troubled debt restructurings and considered impaired finance receivables. As a net result of these changes, the Company increased the provision for credit losses by $0.3 million during the three months ended September 30, 2014, which decreased net income for the year ended December 31, 2014 by $0.2 million, or $0.02 diluted earnings per share. During 2015, the effective life of the large loan product category increased from ten months to twelve months as the Company originated longer term loans. As a result, the Company increased the allowance for credit losses by $0.5 million, which decreased net income for the year ended December 31, 2015 by $0.3 million, or $0.02 diluted earnings per share. The increase in the allowance for credit losses due to the change in effective life was offset by a decrease in the Company’s normal allowance for credit losses on qualitative factors surrounding finance receivables growth and credit quality. The overall large loan allowance for credit losses as a percentage of loans declined from 4.3% to 3.8% as of December 31, 2014 and 2015, respectively. Changes in the allowance for credit losses for the periods indicated are as follows:
|  | December 31, |
In thousands |  | 2016 |  |  | 2015 |  |  | 2014 |
Balance at beginning of year |  | $ | 37,452 |  |  | $ | 40,511 |  |  | $ | 30,089 |
Provision for credit losses |  |  | 63,014 |  |  |  | 47,348 |  |  |  | 69,057 |
Credit losses |  |  | (64,064 | ) |  |  | (55,043 | ) |  |  | (58,236 | )
Credit losses (180+ policy change) |  |  | — |  |  |  | — |  |  |  | (2,106 | )
Recoveries |  |  | 4,848 |  |  |  | 4,636 |  |  |  | 1,707 |
Balance at end of year |  | $ | 41,250 |  |  | $ | 37,452 |  |  | $ | 40,511 |
In December 2015, the Company began selling previously charged-off loans for all products in the portfolio to a third-party debt buyer. The proceeds from these sales were recognized as a recovery in the allowance for credit losses. Recoveries during the year ended December 31, 2015 included $2.0 million from the sale of charged-off loans. No sales of previously charged-off loans were made in 2014. In January 2016, the Company began selling the flow of charged-off loans. The flow sales were recognized as recoveries in the allowance for credit losses and a reduction of the provision for credit losses. The following is a reconciliation of the allowance for credit losses by product for the periods indicated:
In thousands |  | Balance January 1, 2016 |  |  | Provision |  |  | Credit Losses |  |  | Recoveries |  |  | Balance December 31, 2016 |  |  | Finance Receivables December 31, 2016 |  |  | Allowance as Percentage of Finance Receivable December 31, 2016 |
Small loans |  | $ | 21,535 |  |  | $ | 41,119 |  |  | $ | (43,797 | ) |  | $ | 2,913 |  |  | $ | 21,770 |  |  | $ | 358,471 |  |  |  | 6.1 | %
Large loans |  |  | 5,593 |  |  |  | 14,261 |  |  |  | (8,946 | ) |  |  | 552 |  |  |  | 11,460 |  |  |  | 235,349 |  |  |  | 4.9 | %
Automobile loans |  |  | 8,828 |  |  |  | 4,785 |  |  |  | (8,886 | ) |  |  | 1,183 |  |  |  | 5,910 |  |  |  | 90,432 |  |  |  | 6.5 | %
Retail loans |  |  | 1,496 |  |  |  | 2,849 |  |  |  | (2,435 | ) |  |  | 200 |  |  |  | 2,110 |  |  |  | 33,523 |  |  |  | 6.3 | %
Total |  | $ | 37,452 |  |  | $ | 63,014 |  |  | $ | (64,064 | ) |  | $ | 4,848 |  |  | $ | 41,250 |  |  | $ | 717,775 |  |  |  | 5.7 | %
In thousands |  | Balance January 1, 2015 |  |  | Provision |  |  | Credit Losses |  |  | Recoveries |  |  | Balance December 31, 2015 |  |  | Finance Receivables December 31, 2015 |  |  | Allowance as Percentage of Finance Receivable December 31, 2015 |
Small loans |  | $ | 25,280 |  |  | $ | 33,428 |  |  | $ | (40,059 | ) |  | $ | 2,886 |  |  | $ | 21,535 |  |  | $ | 338,157 |  |  |  | 6.4 | %
Large loans |  |  | 1,980 |  |  |  | 6,032 |  |  |  | (2,762 | ) |  |  | 343 |  |  |  | 5,593 |  |  |  | 146,553 |  |  |  | 3.8 | %
Automobile loans |  |  | 11,776 |  |  |  | 6,285 |  |  |  | (10,466 | ) |  |  | 1,233 |  |  |  | 8,828 |  |  |  | 116,109 |  |  |  | 7.6 | %
Retail loans |  |  | 1,475 |  |  |  | 1,603 |  |  |  | (1,756 | ) |  |  | 174 |  |  |  | 1,496 |  |  |  | 27,625 |  |  |  | 5.4 | %
Total |  | $ | 40,511 |  |  | $ | 47,348 |  |  | $ | (55,043 | ) |  | $ | 4,636 |  |  | $ | 37,452 |  |  | $ | 628,444 |  |  |  | 6.0 | %
In thousands |  | Balance January 1, 2014 |  |  | Provision |  |  | Credit Losses |  |  | Credit Losses (180+ Policy Change) |  |  | Recoveries |  |  | Balance December 31, 2014 |  |  | Finance Receivables December 31, 2014 |  |  | Allowance as Percentage of Finance Receivable December 31, 2014 |
Small loans |  | $ | 15,370 |  |  | $ | 50,755 |  |  | $ | (40,697 | ) |  | $ | (1,132 | ) |  | $ | 984 |  |  | $ | 25,280 |  |  | $ | 319,533 |  |  |  | 7.9 | %
Large loans |  |  | 2,233 |  |  |  | 1,985 |  |  |  | (2,334 | ) |  |  | (203 | ) |  |  | 299 |  |  |  | 1,980 |  |  |  | 46,147 |  |  |  | 4.3 | %
Automobile loans |  |  | 10,827 |  |  |  | 14,259 |  |  |  | (12,939 | ) |  |  | (688 | ) |  |  | 317 |  |  |  | 11,776 |  |  |  | 154,382 |  |  |  | 7.6 | %
Retail loans |  |  | 1,659 |  |  |  | 2,058 |  |  |  | (2,266 | ) |  |  | (83 | ) |  |  | 107 |  |  |  | 1,475 |  |  |  | 26,130 |  |  |  | 5.6 | %
Total |  | $ | 30,089 |  |  | $ | 69,057 |  |  | $ | (58,236 | ) |  | $ | (2,106 | ) |  | $ | 1,707 |  |  | $ | 40,511 |  |  | $ | 546,192 |  |  |  | 7.4 | %
Impaired finance receivables as a percentage of total finance receivables were 1.6% and 1.2% for the years ended December 31, 2016 and 2015, respectively. The following is a summary of finance receivables evaluated for impairment for the periods indicated:
|  | December 31, 2016 |
In thousands |  | Small |  |  | Large |  |  | Automobile |  |  | Retail |  |  | Total |
Impaired receivables specifically evaluated |  | $ | 2,409 |  |  | $ | 6,441 |  |  | $ | 2,460 |  |  | $ | 101 |  |  | $ | 11,411 |
Finance receivables evaluated collectively |  |  | 356,062 |  |  |  | 228,908 |  |  |  | 87,972 |  |  |  | 33,422 |  |  |  | 706,364 |
Finance receivables outstanding |  | $ | 358,471 |  |  | $ | 235,349 |  |  | $ | 90,432 |  |  | $ | 33,523 |  |  | $ | 717,775 |
Impaired receivables in nonaccrual status |  | $ | 288 |  |  | $ | 610 |  |  | $ | 175 |  |  | $ | 7 |  |  | $ | 1,080 |
Amount of the specific reserve for impaired accounts |  | $ | 563 |  |  | $ | 1,216 |  |  | $ | 576 |  |  | $ | 19 |  |  | $ | 2,374 |
Amount of the general component of the allowance |  | $ | 21,207 |  |  | $ | 10,244 |  |  | $ | 5,334 |  |  | $ | 2,091 |  |  | $ | 38,876 |
|  | December 31, 2015 |
In thousands |  | Small |  |  | Large |  |  | Automobile |  |  | Retail |  |  | Total |
Impaired receivables specifically evaluated |  | $ | 1,009 |  |  | $ | 2,760 |  |  | $ | 3,370 |  |  | $ | 121 |  |  | $ | 7,260 |
Finance receivables evaluated collectively |  |  | 337,148 |  |  |  | 143,793 |  |  |  | 112,739 |  |  |  | 27,504 |  |  |  | 621,184 |
Finance receivables outstanding |  | $ | 338,157 |  |  | $ | 146,553 |  |  | $ | 116,109 |  |  | $ | 27,625 |  |  | $ | 628,444 |
Impaired receivables in nonaccrual status |  | $ | 204 |  |  | $ | 83 |  |  | $ | 415 |  |  | $ | 17 |  |  | $ | 719 |
Amount of the specific reserve for impaired accounts |  | $ | 266 |  |  | $ | 560 |  |  | $ | 862 |  |  | $ | 20 |  |  | $ | 1,708 |
Amount of the general component of the allowance |  | $ | 21,269 |  |  | $ | 5,033 |  |  | $ | 7,966 |  |  | $ | 1,476 |  |  | $ | 35,744 |
Average recorded investment in impaired finance receivables for the periods indicated are as follows:
|  | December 31, |
In thousands |  | 2016 |  |  | 2015 |
Small loans |  | $ | 1,686 |  |  | $ | 1,100 |
Large loans |  |  | 4,478 |  |  |  | 1,523 |
Automobile loans |  |  | 2,801 |  |  |  | 3,571 |
Retail loans |  |  | 114 |  |  |  | 128 |
Total average recorded investment |  | $ | 9,079 |  |  | $ | 6,322 |
It is not practical to compute the amount of interest earned on impaired loans.

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- Definition The entire disclosure for financing receivables. Examples of financing receivables include, but are not limited to, loans, trade accounts receivables, notes receivable, credit cards, and receivables relating to a lessor's right(s) to payment(s) from a lease other than an operating lease that is recognized as assets. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 310 -SubTopic 10 -Section 55 -Paragraph 14 -URI http://asc.fasb.org/extlink&oid=32702940&loc=SL6953791-111525 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 310 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=66008989&loc=d3e4975-111524 + Details
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- References No definition available. + Details
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