Cash America 2014 Annual Report Download - page 79

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64
Consumer Loan Activities
Combined Consumer Loans
Consumer Loan Balances
The following table summarizes consumer loan balances outstanding as of December 31, 2013 and 2012
(dollars in thousands):
As of December 31,
2013 2012
Company
Owned(a)
Guaranteed
by the
Company(a) Combined(b)
Company
Owned(a)
Guaranteed
by the
Company(a) Combined(b)
Ending consumer loan balances:
Short
-
term loans
$
49,856
$
4,900
$
54,756
$
52,171
$
7,134
$
59,305
Installment loans
9,787
12,639
22,426
11,246
9,395
20,641
Total ending loan balance, gross
59,643
17,539
77,182
63,417
16,529
79,946
Less: Allowance and liabilities for
losses
(4,911
)
(1,030
)(5,941)
(4,779
)(872)
(5,651
)
Total ending loan balance, net $54,732 $16,509 $71,241 $58,638 $15,657 $74,295
Allowance and liability for losses
as a % of consumer loan
balances, gross
8.2
%
5.9
%
7.7
%
7.5
%
5.3
%
7.1
%
(a) GAAP measure. The consumer loan balances guaranteed by the Company represent loans originated by third-party lenders through the
CSO programs, so these balances are not recorded in the Company’s financial statements. However, the Company has established a
liability for estimated losses in support of its guarantee of these loans, which is reflected in the table above and included in its
consolidated balance sheets.
(b) Except for allowance and liability for estimated losses, amounts represent non-GAAP measures.
Consumer Loan Fees
Consumer loan fees decreased $8.7 million, or 7.1%, to $113.2 million in 2013 compared to $121.9 million
in 2012. The decrease in consumer loan fees was primarily due to a decrease in consumer loan demand in the
Company’s retail services locations and the Texas Consumer Loan Store Closures.
Consumer Loan Loss Provision
The loss provision as a percentage of consumer loan fees increased to 29.5% in 2013 from 24.0% in 2012
primarily due to a shift in mix of loans in the portfolio in 2013 as compared to 2012 to include a higher proportion
of the installment loans, which generally carry higher loss rates than short-term consumer loans. Additionally, the
Company experienced higher charge-offs and decreased collections in each of these portfolios in 2013 as compared
to 2012, leading to higher loan losses in the overall portfolio. The consumer loan loss provision increased $4.1
million, or 14.1%, to $33.4 million from 2012 to 2013.