OneMain Holdings, Inc. Q1 FY2026 earnings call

• Satisfied with quarter's financial results, continuing momentum. Capital generation $194 million, CNI adjusted earnings up 13% yoy. Total revenue and receivables grew 6% yoy. - Progress on strategic initiatives: Personal loans enhancing product offerings, accessing bank data for better loan terms, new home fixture secured loan product performing well. Auto finance growing dealer network, piloting AI tool for insurance recovery. Credit card delivering strong results with receivables and customer accounts growth, combining product innovation and customer engagement. - Steady rise in customer adoption of financial wellness offering OneMainMyMoney.

Personal loans: Capital generation was $194 million in the quarter. CNI adjusted earnings were $1.95 per share, up 13% year over year. Total revenue and receivables each grew 6% year over year. Auto finance: Receivables grew 14% year - over - year to $2.8 billion. Credit card: Receivables increased 45% year over year to just under $1 billion, and customer accounts are up 40% year over year to nearly 1.2 million.

• Expect to grow managed receivables in the range of six to nine percent in 2026 while maintaining conservative underwriting posture. - Expect C9 net charge off in the range of 7.4 to 7.9%. - Expect full year operating expense ratio to be approximately 6.6%.

• Macro - economic environment changes could materially affect credit performance. - Uncertainty regarding the bank application process. - Litigation risks related to state AG lawsuits with unmerited claims.

Q: Any update on the bank application?

A: No updates this quarter. The process continues to move forward. Timing is uncertain, but we remain optimistic as we have a strong case for approval and are having constructive dialogues with the FDIC and the Utah Department of Financial Institutions.

Q: Update on branch versus digital activities and branch trajectory?

A: We're a multi - product omni - channel lender. Branches are a competitive differentiator. We've reduced branch footprint, invested in technology to make branch team members more productive. AI helps with automating information and freeing up team members.

Q: On credit quality, expansion on back book loans and confidence in reaching second half levels?

A: Back book represents 5% of portfolio but 14% of 30 + delinquency. Loans going delinquent at 2 times higher rate than expected. Confidence comes from loans typically being about 5 years old, vintage burn - off and new loans coming in.

Q: Credit card business profitability, investment and comparison to core installment product?

A: Card business was challenging to set up but leveraging company scale. Now profitable. Card business has similar or slightly higher return profile. Focus on scaling and unit operating expenses.

Q: Personal loans originations balance, push and pull with card and auto, and consumer health with rising oil prices?

A: Businesses run independently, each needs to meet 20% ROE threshold. Personal loans grow from large base, auto and credit card from large markets. Consumer remains resilient, credit performing as expected.

Q: Credit, drivers of gross charge - offs and recovery, roll rates?

A: Net charge - offs in line with expectations. Some normalization in roll rates from delinquency to loss. Recoveries improved due to internal capability enhancements.

Q: Back book DQ formation and charge - off outlook?

A: Back book contribution to delinquency has shrunk slightly. Assumption is on vintages, new loans coming in, back book contribution coming down.

Q: State AG lawsuits status?

A: Claims are untrue, no merit. We're happy to go to court and confident of winning. Not material to business.

Q: Credit box considering higher gas prices, status and outlook?

A: Have a conservative credit box with 30% stress overlay. Not tightening now, making tweaks but overall overlay constant. Confident in achieving guidance despite recent environment changes.