-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, LsBr0sa+N/r2rWgVVlqsUj5Zvz3EUGEJ+0ARYjdwc5FzBBUEUISVZZIS5BjIxycs qzE9CZWuza0X2QVjjSn6Gg== /in/edgar/work/20000725/0000354964-00-000014/0000354964-00-000014.txt : 20000921 0000354964-00-000014.hdr.sgml : 20000921 ACCESSION NUMBER: 0000354964-00-000014 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20000719 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 20000725 FILER: COMPANY DATA: COMPANY CONFORMED NAME: HOUSEHOLD INTERNATIONAL INC CENTRAL INDEX KEY: 0000354964 STANDARD INDUSTRIAL CLASSIFICATION: [6141 ] IRS NUMBER: 363121988 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-08198 FILM NUMBER: 678582 BUSINESS ADDRESS: STREET 1: 2700 SANDERS RD CITY: PROSPECT HEIGHTS STATE: IL ZIP: 60070 BUSINESS PHONE: 8475645000 MAIL ADDRESS: STREET 1: 2700 SANDERS ROAD CITY: PROSPECT HEIGHTS STATE: IL ZIP: 60070 8-K 1 0001.txt 1 FORM 8-K SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 CURRENT REPORT Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934 Date of Report: July 19, 2000 ------------- HOUSEHOLD INTERNATIONAL, INC. ----------------------------- (Exact name of registrant as specified in its charter) Delaware 1-8198 36-3121988 - -------------------------------------------------------------- (State or other (Commission File (IRS Employer jurisdiction of Number) Identification incorporation Number) 2700 Sanders Road, Prospect Heights, Illinois 60070 - --------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code 847/564-5000 ------------ 2 Item 5. Other Events Press release pertaining to the financial results of Household International, Inc., for second quarter ended June 30, 2000. Said release is filed as an exhibit hereto. Item 7. Financial Statements and Exhibits (a) Financial statements of businesses acquired. Not applicable. (b) Pro forma financial information. Not applicable. (c) Exhibits. No. Exhibit --- ------- 27 Financial Data Schedule. 99 Press release titled "Household International Reports Strongest Second Quarter in its History" dated July 19, 2000. 3 SIGNATURE Pursuant to the requirement of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. HOUSEHOLD INTERNATIONAL, INC. ---------------------------- (Registrant) By: /s/ John W. Blenke ------------------- John W. Blenke Assistant Secretary Dated: July 24, 2000 ------------- EX-27 2 0002.txt
5 THE FOLLOWING SUMMARY FINNCIAL INFORMATION OF THE COMANY AND ITS SUBSIDIARIES IS QUALIFIED IN ITS ENTIRETY BY THE DETAILED INFORMATION AND FINANCIAL STATEMENTS PREVIOUSLY FILED WITH THE SECURITIES & EXCHANGE COMMISSION. 1,000 6-MOS DEC-31-2000 JUN-30-2000 478,800 3,263,600 61,378,800 2,948,200 0 0 1,397,900 905,400 70,469,700 0 40,035,100 0 164,400 550,600 7,349,100 70,469,700 0 5,600,800 0 1,677,500 0 1,017,700 1,754,700 1,150,900 394,100 756,800 0 0 0 756,800 1.59 1.58 FINANCIAL STATEMENTS OF THE COMPANY WERE PREPARED IN ACCORDANCE WITH FINANCIAL INSTITUTION INDUSTRY STANDARDS. ACCORDINGLY, THE COMPANY'S BALANCE SHEETS WERE NON-CLASSIFIED.
EX-99 3 0003.txt 1 Household International Reports Strongest Second Quarter in its History - - Earnings Per Share Up 19%, to $.80 - - Net Income Up 17%, to $384 Million - - Receivables Up 22% Over Second Quarter of `99 - - Credit Qaulity Improves PROSPECT HEIGHTS, IL, July 19, 2000 -- Household International (NYSE: HI) today reported that earnings per share rose to a second quarter record $.80, up 19 percent from $.67 a year ago. Net income increased 17 percent to $383.9 million, from $326.9 million in the second quarter of 1999. Cash earnings per share for the quarter totaled $.88. "Our superb second quarter results were highlighted by outstanding receivables and revenue growth and a significant improvement in credit quality," said William F. Aldinger, Household's chairman and chief executive officer. The company's managed receivables portfolio grew 22 percent from a year ago, reaching almost $80 billion. The company added $4.5 billion of receivables in the quarter, an increase of 6 percent. Revenues rose 20 percent compared to the year-ago quarter. Aldinger continued, "Our record performance reflects strong sales and marketing results in all of our businesses coupled with our continued focus on risk management and operational efficiency." Aldinger concluded, "Our results to date include significant investments in people, technology and marketing to support future growth and profitability. While our plan calls for additional investment in the second half of the year, we are comfortable in our ability to achieve our 15 percent EPS growth target for 2000." Receivable Growth The company's managed portfolio grew $4.5 billion, or 6 percent, in the quarter, with all businesses contributing to the increase. Growth in the company's consumer finance business was particularly strong, including a $1.5 billion home equity portfolio acquired late in the second quarter. Excluding the purchase, total receivables grew almost $3 billion, or 3.9 percent, during the quarter. The managed portfolio totaled $80 billion, or 22 percent above the year-ago level. Revenues Revenues increased $348 million, or 20 percent, from a year ago. The company's net interest margin increased $231 million or 17 percent, led by strong receivable volumes. In percentage terms, the managed net interest margin in the second quarter was 8.17, compared to 8.31 in both the prior quarter and prior year. The year-over-year decline was due to higher funding costs and the continuing shift in mix to real estate secured receivables. Managed fee income increased 25 percent compared to the second quarter of 1999, principally reflecting higher levels of fees in the company's credit card businesses. Operating Expenses Operating expenses rose $135 million, or 22 percent, from a year ago, due to higher receivable levels and continued expansion of marketing and e-commerce initiatives. Personnel costs increased compared to both the first quarter and a year ago, driven by higher sales incentive compensation and additional staffing to support growth in the consumer finance and bankcard businesses. The efficiency ratio was 36.5 percent for the second quarter of 2000 compared to 36.0 percent in the year-ago quarter. Credit Quality and Loss Reserves Credit quality improved dramatically during the quarter, as dollars of chargeoff and delinquency declined from first quarter levels. At June 30, the managed delinquency ratio (60+days) improved for the third consecutive quarter, to 4.16 percent. This represented a 27 basis-point improvement from the first quarter and a 56 basis-point improvement from a year ago. The annualized managed net chargeoff ratio for the second quarter fell 26 basis points sequentially, to 3.74 percent. The chargeoff ratio was 4.10 percent a year ago. 2 Credit loss reserves increased $87 million in the second quarter, to $2.9 billion at June 30. The ratio of reserves-to-managed receivables was 3.69 percent at the end of the second quarter, compared to 3.79 percent at March 31 and 3.86 percent a year ago. Reserves-to-nonperforming loans at June 30 were 113 percent compared to 104 percent a year earlier. Share Repurchase Program In connection with its $2 billion share repurchase program, announced on March 9, 1999, the company bought back 1.3 million shares in the second quarter, totaling $45 million. At June 30th the company had agreements with third parties to purchase, on a forward basis, approximately 6.8 million shares of its common stock at a weighted average price of $38.13 per share. Household International, through its subsidiaries, is a leading provider of consumer finance, credit card, auto finance and credit insurance products in the United States, United Kingdom and Canada. In the United States, Household operates under the two oldest and most recognized names in consumer finance - HFC and Beneficial. Household is also one of the nation's largest issuers of private-label and general purpose credit cards, including the GM Card and the AFL-CIO's Union Privilege card. For more information, visit the company's web site at http://www.household.com . This press release contains certain estimates and projections that may be forward-looking in nature, as defined by the Private Securities Litigation Reform Act of 1995. A variety of factors may cause actual results to differ materially from the results discussed in these forward-looking statements. Factors that might cause such a difference are discussed in Household International's periodic reports that are filed with the SEC. CONTACT: Craig A. Streem, Vice President, Investor Relations, 847-564-6053, or Celeste M. Murphy, Director, Investor Relations, 847-564-7568, both of Household International 3 Quarterly Financial Supplement
June 30, 2000 - Quarterly Highlights - ------------------------------------------------------------------------------------------------------------------- Summary Managed Income Statement Three Months Ended % Change from Prior ------------------------------ ------------------- ($ millions) 06/30/00 03/31/00 06/30/99 Qtr. Year - ------------------------------------------------------------------------------------------------------------------- Managed-basis net interest margin and other revenues $2,092.5 $2,165.2 $1,744.7 (3.4)% 19.9 % Managed-basis provision for credit losses 744.3 816.2 631.1 (8.8) 17.9 Operating expenses 762.8 783.5 627.5 (2.6) 21.6 - ------------------------------------------------------------------------------------------------------------------- Income before income taxes 585.4 565.5 486.1 3.5 20.4 Income taxes 201.5 192.6 159.2 4.6 26.6 - ------------------------------------------------------------------------------------------------------------------- Net Income $ 383.9 $ 372.9 $ 326.9 2.9 17.4 =================================================================================================================== Common Stock Data - ------------------------------------------------------------------------------------------------------------------- Basic earnings per common share $ .80 $ .79 $ .67 1.3 % 19.4 % Diluted earnings per common share .80 .78 .67 2.6 19.4 - ------------------------------------------------------------------------------------------------------------------- Average common shares (millions) 473.3 470.5 479.1 .6 (1.2) Average common and equivalent shares (millions) 477.0 474.0 484.3 .6 (1.5) - ------------------------------------------------------------------------------------------------------------------- Common stock price High $ 48.19 $ 39.19 $ 52.31 23.0 (7.9) Low 36.00 29.50 42.00 22.0 (14.3) Period end 41.56 37.31 47.38 11.4 (12.3) - ------------------------------------------------------------------------------------------------------------------- Dividends declared per common share $ .19 $ .17 $ .17 11.8 11.8 Book value per common share 15.28 14.78 13.02 3.4 17.4 =================================================================================================================== Key Ratios - ------------------------------------------------------------------------------------------------------------------- Return on average common shareholders' equity 21.5% 22.0% 20.9% (2.3)% 2.9 % Return on average owned assets 2.27 2.37 2.37 (4.2) (4.2) Return on average managed assets 1.78 1.82 1.78 (2.2) - Managed efficiency ratio, normalized 36.5 36.2 36.0 0.8 1.4 Managed net interest margin 8.17 8.31 8.31 (1.7) (1.7) Total shareholders' equity as a percent of managed assets 9.06 8.94 9.19 1.3 (1.4) Tangible equity to tangible managed assets 7.23 6.94 7.22 4.2 0.1 ===================================================================================================================
4 Quarterly Financial Supplement (continued)
Year to Date Highlights - -------------------------------------------------------------------------------------------- Summary Managed Income Statement Six Months Ended ------------------- ($ millions) 06/30/00 06/30/99 % Change - -------------------------------------------------------------------------------------------- Managed-basis net interest margin and other revenues $4,257.7 $3,536.6 20.4 % Managed-basis provision for credit losses 1,560.5 1,302.6 19.8 Operating expenses 1,546.3 1,265.8 22.2 - ------------------------------------------------------------------------------------------ Income before income taxes 1,150.9 968.2 18.9 Income taxes 394.1 320.5 23.0 - ------------------------------------------------------------------------------------------ Net Income $ 756.8 $ 647.7 16.8 ========================================================================================== Common Stock Data - ------------------------------------------------------------------------------------------ Basic earnings per common share $ 1.59 $ 1.33 19.5 % Diluted earnings per common share 1.58 1.32 19.7 - ------------------------------------------------------------------------------------------ Average common shares (millions) 471.9 481.8 (2.1) Average common and equivalent shares (millions) 475.5 487.2 (2.4) - ------------------------------------------------------------------------------------------ Common stock price High $ 48.19 $ 52.31 (7.9) Low 29.50 38.69 (23.8) Period end 41.56 47.38 (12.3) - ------------------------------------------------------------------------------------------ Dividends declared per common share $ 0.36 $ 0.34 5.9 ========================================================================================== Key Ratios - ------------------------------------------------------------------------------------------ Return on average common shareholders' equity 21.8% 20.6% 5.8 % Return on average owned assets 2.32 2.38 (2.5) Return on average managed assets 1.80 1.77 1.7 Managed efficiency ratio, normalized 36.3 35.8 1.4 Managed net interest margin 8.24 8.14 1.23 =========================================================================================== To aid analysis, net interest margin, other revenues, and provision for credit losses are presented on a pro forma managed basis as if receivables securitized and sold with limited recourse were held in the portfolio. Policyholders' benefits have been netted against other revenues.
5 Consolidated Statements of Income - Owned Basis
Three Months - ----------------------------------------------------------------------------------- % Change Three Months Ended from Prior ---------------------------- -------------- ($ millions) 06/30/00 03/31/00 06/30/99 Qtr. Year - ----------------------------------------------------------------------------------- Finance income $2,074.2 $1,916.0 $1,583.0 8.3 % 31.0 % Other interest income 9.2 8.9 7.4 3.4 24.3 Interest expense 933.0 821.7 661.2 13.5 41.1 - ----------------------------------------------------------------------------------- Net interest margin 1,150.4 1,103.2 929.2 4.3 23.8 Provision for credit losses on owned receivables 495.6 522.1 407.3 (5.1) 21.7 - ----------------------------------------------------------------------------------- Net interest margin after provision for credit losses 654.8 581.1 521.9 12.7 25.5 - ----------------------------------------------------------------------------------- Securitization income 355.6 346.4 312.5 2.7 13.8 Insurance revenues 131.8 135.0 132.6 (2.4) (0.6) Investment income 42.5 40.8 41.8 4.2 1.7 Fee income 195.9 179.3 135.8 9.3 44.3 Other income 31.9 133.3 38.4 (76.1) (16.9) - ----------------------------------------------------------------------------------- Total other revenues 757.7 834.8 661.1 (9.2) 14.6 - ----------------------------------------------------------------------------------- Salaries and fringe benefits 378.9 344.9 298.6 9.9 26.9 Occupancy and equipment expense 75.6 75.5 66.6 0.1 13.5 Other marketing expenses 125.3 133.1 84.0 (5.9) 49.2 Other servicing and administrative expenses 144.1 186.8 142.3 (22.9) 1.3 Amortization of acquired intangibles and goodwill 38.9 43.2 36.0 (10.0) 8.1 Policyholders' benefits 64.3 66.9 69.4 (3.9) (7.3) - ----------------------------------------------------------------------------------- Total costs and expenses 827.1 850.4 696.9 (2.7) 18.7 - ----------------------------------------------------------------------------------- Income before income taxes 585.4 565.5 486.1 3.5 20.4 Income taxes 201.5 192.6 159.2 4.6 26.6 - ----------------------------------------------------------------------------------- Net income 383.9 372.9 326.9 2.9 17.4 - ----------------------------------------------------------------------------------- Preferred dividends (2.3) (2.3) (2.3) - - - ----------------------------------------------------------------------------------- Earnings available to common shareholders $ 381.6 $ 370.6 $ 324.6 3.0 % 17.6% =================================================================================== Effective tax rate 34.4% 34.1% 32.8% 0.9% 4.9% - -----------------------------------------------------------------------------------
6 Consolidated Statements of Income - Owned Basis
Six Months - ------------------------------------------------------------------ Six Months Ended ------------------ ($ millions) 06/30/00 06/30/99 % Change - ------------------------------------------------------------------ Finance income $3,990.2 $3,081.6 29.5 % Other interest income 18.1 17.3 4.6 Interest expense 1,754.7 1,310.1 33.9 - ------------------------------------------------------------------ Net interest margin 2,253.6 1,788.8 26.0 Provision for credit losses on owned receivables 1,017.7 825.1 23.3 - ------------------------------------------------------------------ Net interest margin after provision for credit losses 1,235.9 963.7 28.2 - ------------------------------------------------------------------ Securitization income 702.0 637.4 10.1 Insurance revenues 266.8 274.8 (2.9) Investment income 83.3 83.0 0.4 Fee income 375.2 265.5 41.3 Other income 165.2 147.6 11.9 - ------------------------------------------------------------------ Total other revenues 1,592.5 1,408.3 13.1 - ------------------------------------------------------------------ Salaries and fringe benefits 723.8 582.7 24.2 Occupancy and equipment expense 151.1 133.4 13.3 Other marketing expenses 258.4 172.5 49.8 Other servicing and administrative expenses 330.9 304.9 8.5 Amortization of acquired intangibles and goodwill 82.1 72.3 13.6 Policyholders' benefits 131.2 138.0 (4.9) - ------------------------------------------------------------------ Total costs and expenses 1,677.5 1,403.8 19.5 - ------------------------------------------------------------------ Income before income taxes 1,150.9 968.2 18.9 Income taxes 394.1 320.5 23.0 - ------------------------------------------------------------------ Net income 756.8 647.7 16.8 - ------------------------------------------------------------------ Preferred dividends (4.6) (4.6) - - ------------------------------------------------------------------ Earnings available to common shareholders $ 752.2 $ 643.1 17.0 % ================================================================== Effective tax rate 34.2% 33.1% 3.3 % - ------------------------------------------------------------------
7 Consolidated Statements of Income - Owned Basis (continued)
Balance Sheet Data - ------------------------------------------------------------------------------------ ($ millions) 06/30/00 03/31/00 06/30/99 - ------------------------------------------------------------------------------------ Owned assets $70,469.7 $64,991.4 $55,749.6 Managed assets 89,035.9 84,248.7 73,644.2 Managed receivables 79,945.0 75,447.3 65,349.6 Debt 59,076.4 54,040.5 45,522.8 Trust originated preferred securities 675.0 375.0 375.0 Preferred stock 164.4 164.4 164.4 Common shareholders' equity 7,224.7 6,989.3 6,229.3 Total shareholders' equity as a percent of managed assets 9.06% 8.94% 9.19% Tangible equity to tangible managed assets 7.23 6.94 7.22 ====================================================================================
8 Consolidated Statements of Income - Managed Basis Securitizations and sales of consumer receivables are a source of liquidity for us. We continue to service the securitized receivables after such receivables are sold and we retain a limited recourse obligation. Securitizations impact the classification of revenues and expenses in the statement of operations. When reporting on a managed basis, net interest margin, provision for credit losses, fee income, and securitization related income related to receivables sold are reclassified from securitization income into the appropriate caption.
Three Months - ----------------------------------------------------------------------------------------------------------------------- % Change Three months ended from Prior ----------------------------------------------------------------- ------------ ($ millions) 06/30/00 03/31/00 06/30/99 Qtr. Year - ----------------------------------------------------------------------------------------------------------------------- Finance and other interest income $ 2,839.6 14.54% $ 2,645.7 14.41% $ 2,273.1 13.84% 7.3% 24.9% Interest expense 1,244.8 6.37 1,120.2 6.10 908.9 5.53 11.1 37.0 - ----------------------------------------------------------------------------------------------------------------------- Net interest margin 1,594.8 8.17% 1,525.5 8.31% 1,364.2 8.31% 4.5 16.9 Provision for credit losses 744.3 816.2 631.1 (8.8) 17.9 - ----------------------------------------------------------------------------------------------------------------------- Net interest margin after provision for credit losses 850.5 709.3 733.1 19.9 16.0 - ----------------------------------------------------------------------------------------------------------------------- Insurance revenues 131.8 135.0 132.6 (2.4) (0.6) Investment income 42.5 40.8 41.8 4.2 1.7 Fee income 353.3 332.8 282.9 6.2 24.9 Securitization related income 2.5 64.7 (45.8) NMF NMF Other income 31.9 133.3 38.4 (76.1) (16.9) - ----------------------------------------------------------------------------------------------------------------------- Total other revenues 562.0 706.6 449.9 (20.5) 24.9 Operating expenses and policyholders' benefits 827.1 850.4 696.9 (2.7) 18.7 - ----------------------------------------------------------------------------------------------------------------------- Income before income taxes 585.4 565.5 486.1 3.5 20.4 Income taxes 201.5 192.6 159.2 4.6 26.6 - ----------------------------------------------------------------------------------------------------------------------- Net income $ 383.9 $ 372.9 $ 326.9 2.9 17.4 ======================================================================================================================= Average managed receivables: Real estate secured $31,912.0 $27,657.1 $23,994.1 15.4% 33.0% Auto finance 3,602.6 3,194.4 2,192.5 12.8 64.3 MasterCard/Visa 15,748.2 15,669.8 15,104.6 0.5 4.3 Private label 10,964.8 11,171.5 9,928.5 (1.9) 10.4 Other unsecured 14,154.5 13,885.0 12,867.6 1.9 10.0 Commercial and other 719.5 770.0 793.6 (6.6) (9.3) - ----------------------------------------------------------------------------------------------------------------------- Total 77,101.6 72,347.8 64,880.9 6.6 18.8 Average noninsurance investments 563.0 657.9 376.5 (14.4) 49.5 Other interest-earning assets 431.2 426.0 420.6 1.2 2.5 - ----------------------------------------------------------------------------------------------------------------------- Average managed interest earning assets $78,095.8 $73,431.7 $65,678.0 6.4% 18.9% =======================================================================================================================
9
Six Months - --------------------------------------------------------------------------------------------- Six months ended ------------------------------------------------------- ($ millions) 06/30/00 06/30/99 % Change - --------------------------------------------------------------------------------------------- Finance and other interest income $ 5,485.3 14.48 % $ 4,482.4 13.71 % 22.4 % Interest expense 2,365.0 6.24 1,823.1 5.57 29.7 - --------------------------------------------------------------------------------------------- Net interest margin 3,120.3 8.24% 2,659.3 8.14 % 17.3 Provision for credit losses 1,560.5 1,302.6 19.8 - --------------------------------------------------------------------------------------------- Net interest margin after provision for credit losses 1,559.8 1,356.7 15.0 - --------------------------------------------------------------------------------------------- Insurance revenues 266.8 274.8 (2.9) Investment income 83.3 83.0 0.4 Fee income 686.1 551.2 24.5 Securitization related income 67.2 (41.3) NMF Other income 165.2 147.6 11.9 - --------------------------------------------------------------------------------------------- Total other revenues 1,268.6 1,015.3 24.9 Operating expenses and policyholders' benefits 1,677.5 1,403.8 19.5 - --------------------------------------------------------------------------------------------- Income before income taxes 1,150.9 968.2 18.9 Income taxes 394.1 320.5 23.0 - --------------------------------------------------------------------------------------------- Net income $ 756.8 $ 647.7 16.8 ============================================================================================= Average managed receivables: Real estate secured $29,784.5 $23,579.5 26.3 % Auto finance 3,398.5 2,041.4 66.5 MasterCard/Visa 15,709.0 15,481.5 1.5 Private label 11,068.1 10,056.5 10.1 Other unsecured 14,019.8 12,523.1 12.0 Commercial and other 744.8 807.8 (7.8) - --------------------------------------------------------------------------------------------- Total 74,724.7 64,489.8 15.9 Average noninsurance investments 610.5 467.0 30.7 Other interest-earning assets 428.6 413.1 3.8 - --------------------------------------------------------------------------------------------- Average managed interest earning assets $75,763.8 $65,369.9 15.9 % ============================================================================================= % Columns: comparison to average managed interest-earning assets, annualized. MasterCard and Visa are registered trademarks of MasterCard International, Incorporated and VISA USA Inc., respectively.
10 Consolidated Statements of Income - Managed Basis (continued) Reconciliation of Securitization Related Income
- ------------------------------------------------------------------------------------ Three Months Ended ------------------------------------ ($ millions) 06/30/00 03/31/00 06/30/99 - ------------------------------------------------------------------------------------ Gross gains $ 96.8 $ 164.4 $ 46.9 Amortization (94.3) (99.7) (92.7) - ------------------------------------------------------------------------------------ Securitization related income 2.5 64.7 (45.8) Over the life provision on new transactions 72.3 122.0 34.3 - ------------------------------------------------------------------------------------ Net effect of securitization activity $ (69.8) $ (57.3) $(80.1) ==================================================================================== Receivables securitized $1,004.0 $1,472.0 $688.0 ====================================================================================
- ----------------------------------------------------------------------- Six Months Ended ----------------------- ($ millions) 06/30/00 06/30/99 - ----------------------------------------------------------------------- Gross gains $ 261.2 $ 138.7 Amortization (194.0) (180.0) - ----------------------------------------------------------------------- Securitization related income 67.2 (41.3) Over the life provision on new transactions 194.3 104.0 - ----------------------------------------------------------------------- Net effect of securitization activity $ (127.1) $ (145.3) ======================================================================= Receivables securitized $2,476.0 $1,482.0 =======================================================================
11 Receivables Analysis
End of Period Managed Receivables - ----------------------------------------------------------------------------------------------------------------------- % Change from Prior ------------------- ($ millions) 06/30/00 03/31/00 06/30/99 Qtr. Year - ----------------------------------------------------------------------------------------------------------------------- Real estate secured $33,964.7 $30,844.5 $24,241.9 10.1% 40.1% Auto finance 3,850.8 3,403.2 2,351.4 13.2 63.8 MasterCard/Visa 15,887.3 15,512.3 14,832.2 2.4 7.1 Private label 10,951.3 11,007.6 10,088.3 (0.5) 8.6 Other unsecured 14,597.2 13,934.1 13,054.0 4.8 11.8 Commercial and other 693.7 745.6 781.8 (7.0) (11.3) - ----------------------------------------------------------------------------------------------------------------------- Managed portfolio $79,945.0 $75,447.3 $65,349.6 6.0% 22.3% ======================================================================================================================= Receivables (% of Managed Portfolio) - ----------------------------------------------------------------------------------------------------------------------- Real estate secured 42.5% 40.9% 37.1% Auto finance 4.8 4.5 3.6 MasterCard/Visa 19.8 20.5 22.7 Private label 13.7 14.6 15.4 Other unsecured 18.3 18.5 20.0 Commercial and other 0.9 1.0 1.2 - ----------------------------------------------------------------------------------------------------------------------- Total 100.0% 100.0% 100.0% ======================================================================================================================= End of Period Receivables ($ millions) - ----------------------------------------------------------------------------------------------------------------------- Owned receivables: Real estate secured $32,168.5 $28,816.0 $21,387.9 11.6% 50.4% Auto finance 1,753.7 1,439.7 1,103.0 21.8 59.0 MasterCard/Visa 7,013.7 6,505.4 6,100.1 7.8 15.0 Private label 9,801.3 9,857.6 9,387.5 (0.6) 4.4 Other unsecured 9,947.9 8,825.7 8,694.7 12.7 14.4 Commercial and other 693.7 745.6 781.8 (7.0) (11.3) - ----------------------------------------------------------------------------------------------------------------------- Total owned receivables 61,378.8 56,190.0 47,455.0 9.2 29.3 - ----------------------------------------------------------------------------------------------------------------------- Accrued finance charges 1,093.1 957.5 742.6 14.2 47.2 Credit loss reserve for owned receivables (1,986.5) (1,909.7) (1,737.6) 4.0 14.3 Unearned credit insurance premiums and claims reserves (593.7) (558.1) (514.1) 6.4 15.5 Amounts due and deferred from receivables sales 2,192.8 2,367.7 1,922.2 (7.4) 14.1 Reserve for receivables serviced with limited recourse (961.7) (951.4) (786.4) 1.1 22.3 - ----------------------------------------------------------------------------------------------------------------------- Total owned receivables, net 61,122.8 56,096.0 47,081.7 9.0 29.8 - ----------------------------------------------------------------------------------------------------------------------- Receivables serviced with limited recourse: Real estate secured 1,796.2 2,028.5 2,854.0 (11.5) (37.1) Auto finance 2,097.1 1,963.5 1,248.4 6.8 68.0 MasterCard/Visa 8,873.6 9,006.9 8,732.1 (1.5) 1.6 Private label 1,150.0 1,150.0 700.8 - 64.1 Other unsecured 4,649.3 5,108.4 4,359.3 (9.0) 6.7 - ----------------------------------------------------------------------------------------------------------------------- Total receivables serviced with limited recourse 18,566.2 19,257.3 17,894.6 (3.6) 3.8 - ----------------------------------------------------------------------------------------------------------------------- Total managed receivables, net $79,689.0 $75,353.3 $64,976.3 5.8% 22.7% =======================================================================================================================
12 Credit Quality/Credit Loss Reserves
Two-Months-and-Over Contractual Delinquency - ----------------------------------------------------------------------------------------------------------- As a percent of managed consumer receivables, excludes commercial. 06/30/00 03/31/00 06/30/99 - ----------------------------------------------------------------------------------------------------------- Real estate secured 2.72% 2.99% 3.29% Auto finance 1.99 1.52 1.87 MasterCard/Visa 3.14 3.06 3.11 Private label 5.77 5.94 6.62 Other unsecured 7.92 8.56 8.17 - ----------------------------------------------------------------------------------------------------------- Total 4.16% 4.43% 4.72% =========================================================================================================== Quarter-to-Date Chargeoffs, Net of Recoveries - ----------------------------------------------------------------------------------------------------------- As a percent of average managed consumer receivables, annualized, excludes commercial. Real estate secured .47% .52% .64% Auto finance 4.28 5.25 4.41 MasterCard/Visa 5.57 5.69 7.30 Private label 5.43 5.65 5.57 Other unsecured 7.68 7.41 5.61 - ----------------------------------------------------------------------------------------------------------- Total 3.74% 4.00% 4.10% =========================================================================================================== Nonperforming Assets - ----------------------------------------------------------------------------------------------------------- ($ millions) - ----------------------------------------------------------------------------------------------------------- Nonaccrual managed receivables $1,841.8 $1,934.2 $1,667.4 Accruing managed receivables 90 or more days delinquent 753.9 755.0 747.3 Renegotiated commercial loans 12.3 12.3 12.3 - ----------------------------------------------------------------------------------------------------------- Total nonperforming managed receivables 2,608.0 2,701.5 2,427.0 Real estate owned 323.6 301.0 249.6 - ----------------------------------------------------------------------------------------------------------- Total nonperforming assets $2,931.6 $3,002.5 $2,676.6 =========================================================================================================== Managed credit loss reserves as a percent of nonperforming managed receivables 113.0% 105.9% 104.0% - -----------------------------------------------------------------------------------------------------------
13 Credit Quality/Credit Loss Reserves (continued)
Credit Loss Reserves - ----------------------------------------------------------------------------------------------------------------- ($ millions) 06/30/00 03/31/00 06/30/99 - ----------------------------------------------------------------------------------------------------------------- Reserves for owned receivables at beginning of quarter $1,909.7 $1,757.0 $1,729.7 Provision for credit losses 495.6 522.1 407.3 Chargeoffs, net of recoveries (474.0) (482.2) (408.0) Portfolio acquisitions, net 55.2 112.8 8.6 - ----------------------------------------------------------------------------------------------------------------- Reserves for owned receivables at end of quarter 1,986.5 1,909.7 1,737.6 - ----------------------------------------------------------------------------------------------------------------- Credit loss reserves for receivables serviced with limited recourse at beginning of quarter 951.4 909.6 814.8 Provision for credit losses 248.7 294.1 223.8 Chargeoffs, net of recoveries (241.9) (249.8) (251.2) Other, net 3.5 (2.5) (1.0) - ----------------------------------------------------------------------------------------------------------------- Credit loss reserves for receivables serviced with limited recourse at end of quarter 961.7 951.4 786.4 - ----------------------------------------------------------------------------------------------------------------- Total managed credit loss reserves at end of quarter $2,948.2 $2,861.1 $2,524.0 ================================================================================================================= Credit loss reserves Owned $1,986.5 3.24% $1,909.7 3.40% $1,737.6 3.66% Serviced with limited recourse 961.7 5.18 951.4 4.94 786.4 4.39 - ----------------------------------------------------------------------------------------------------------------- Total managed credit loss reserves $2,948.2 3.69% $2,861.1 3.79% $2,524.0 3.86% ================================================================================================================= % Columns: comparisons to appropriate receivables.
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