Regional Management Corp (RM) 2022年年度報告「NYSE」.pdf

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1、2022 Annual ReportFiscal Year 2022 Form 10-KProxy Statement for the2023 Annual Meeting of StockholdersCoast to CoastCommitmentRegional Management Corp.|2022 Annual Report|Fiscal Year 2022 Form 10-K|Proxy Statement for the 2023 Annual Meeting of StockholdersRegional Management Corp.979 Batesville Roa

2、d,Suite BGreer,South Carolina Dear Valued Stockholders:Despite 2022 being a volatile year in the US economy,with inflation rates not seen in 40+years and the ensuing rapid interest ratehikes to fight inflation,our efforts over the past few years to strengthen our balance sheet,invest in our omni-cha

3、nnel operating modeland footprint,and enhance our custom underwriting model,allowed us to manage through the year and exit 2022 in a strong position.This position of strength grants us the ability to navigate the current economic environment and to respond quickly when conditionsimprove.Our team rem

4、ains committed to serving our customers with financial solutions to meet their evolving needs and support theirlong-term financial wellbeing,and solidly executing for all of our stakeholders to drive controlled,sustainable growth and profitabilityin 2023 and beyond.For 2022,we ended the year with$1.

5、699 billion in outstanding finance receivables,an increase of 19%from year-end 2021 and totalrevenue of$507 million in 2022 an 18%increase from 2021.As delinquencies normalized throughout the year,we tightened creditgiven the increasingly challenging environment and focused on underwriting the highe

6、st quality originations.We continued to closelymanage our operating expenses,while we completed several new digital initiatives that should prove to be significantly beneficialfor us over the longer term.Net income for 2022 was$51 million,diluted EPS was$5.30,ROA was 3.3%,and ROE was 17.0%.Despite t

7、he challenging economic environment,we made significant progress during the year in executing on our long-term growthstrategy.Most notably,we expanded our footprint across the nation,commencing operations in five new states California,Indiana,Louisiana,Idaho,and Mississippi.As a result,we now have a

8、“coast-to-coast”U.S.presence and have nearly doubled our totaladdressable market over the past two years,providing us with ample opportunity to lean into growth as the environment stabilizes.In addition,we completed the rollout of our second-generation custom underwriting scorecard,which evaluates o

9、ver 5,000 attributesand has more complex segmentations that allows us to further finetune our underwriting strategies,make better credit decisionsat the margin and ultimately improve our credit loss experience.Importantly,we also continued to make strides in enhancing our best-in-class customer expe

10、rience.To that end,we rolled out our new customer online portal,which improves online payment functionality,and we began piloting our end-to-end digital lending solution,which is a potential game changer for Regional in termsof efficiency and customer engagement.We also continued to focus on best se

11、rving our team members and our communities.For our team members,in addition to ourcompetitive wages and benefits,we offer benefits from the C.A.R.E.Fund,which provides eligible team members with short-termassistance when facing a severe,unexpected emergency situation.We also remain committed to furt

12、her developing our highlydiversified workforce;earlier this year,we published our new Corporate Responsibility&ESG website,which we invite you to viewto learn more about our efforts and continued diversity,equity,and inclusion initiatives.Meanwhile,our employee-led programRegional Reach continues to

13、 make a positive impact through community service and charitable giving.We once again partneredwith the American Heart Association and led all Upstate South Carolina companies for the third year in a row in fundraising for theHeart Walk.We also continued to support the Hope Center for Children and o

14、ther organizations to promote goodwill.For our shareholders,we continued to successfully return excess capital in the form of dividends totaling$11 million(after increasingour quarterly dividend by 20%to$0.30 per share)and share repurchases totaling$21 million in 2022.We also ended the year with ast

15、rong balance sheet over$555 million of unused borrowing capacity and$101 million of available liquidity from which to fund ourgrowth and operations.Of our total debt as of year-end 2022,88%was fixed rate,with a weighted average coupon of 3.6%andweighted average revolving duration of 2.1 years.Our se

16、nsible management of our balance sheet over the past few years hassuccessfully enabled us to mitigate our exposure to rising interest rates.We believe the actions we took in 2022 position us well to address the macro environment in 2023.We will continue to place ourfocus on our highest confidence or

17、iginations,emphasizing quality over quantity.We will originate loans only where we can achieveour return hurdles under an assumption of additional credit stress beyond current levels,as well as higher future funding costs.From an investment standpoint,we will seek to capitalize on the increased addr

18、essable market in the eight new states we haveentered over the past couple of years.Our efforts will include the completion of several important technology,digital,and data andanalytics projects,as we continue to modernize and evolve our omni-channel business strategy,while continuing to manage oure

19、xpenses prudently.We remain confident in our operating model and our ability to generate long-term sustainable growth and valuecreation for our stockholders.Thank you for your continued support and ownership of Regional Management Corp.stock.We look forward to having you attendour Annual Meeting.Our

20、 best to you and your families.Best regards,Robert W.BeckPresident and Chief Executive OfficerThis letter and annual report to stockholders may contain forward-looking statements.Please refer to our Annual Report on Form 10-K,which accompanies this letter and annual report to stockholders,for additi

21、onal information regarding forward-looking statements.Annual Report on Form 10-Kfor the Year Ended December 31,2022UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington,D.C.20549FORM 10-KANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended

22、December 31,2022ORTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934For the transition period fromtoCommission File Number:001-35477Regional Management Corp.(Exact name of registrant as specified in its charter)Delaware57-0847115(State or other jurisdiction ofinc

23、orporation or organization)(I.R.S.EmployerIdentification No.)979 Batesville Road,Suite BGreer,South Carolina29651(Address of principal executive offices)(Zip Code)(864)448-7000(Registrants telephone number,including area code)Securities registered pursuant to Section 12(b)of the Act:Title of Each Cl

24、assTrading SymbolName of Each Exchange on Which RegisteredCommon Stock,$0.10 par valueRMNew York Stock ExchangeSecurities registered pursuant to Section 12(g)of the Act:NoneIndicate by check mark if the registrant is a well-known seasoned issuer,as defined in Rule 405 of the Securities Act.Yes No In

25、dicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d)of the Act.Yes No Indicate by check mark whether the registrant(1)has filed all reports required to be filed by Section 13 or 15(d)of the Securities Exchange Act of 1934 during the preceding 12month

26、s(or for such shorter period that the registrant was required to file such reports),and(2)has been subject to such filing requirements for the past 90days.Yes No Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant t

27、o Rule 405 of Regulation S-T(232.405 of this chapter)during the preceding 12 months(or for such shorter period that the registrant was required to submit such files).Yes No Indicate by check mark whether the registrant is a large accelerated filer,an accelerated filer,a non-accelerated filer,a small

28、er reporting company,or an emerging growthcompany.See the definitions of“large accelerated filer,”“accelerated filer,”“smaller reporting company,”and“emerging growth company”in Rule 12b-2 of the Exchange Act.Large accelerated filerAccelerated filerNon-accelerated filerSmaller reporting companyEmergi

29、ng growth companyIf an emerging growth company,indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financialaccounting standards provided pursuant to Section 13(a)of the Exchange Act.Indicate by check mark whether the r

30、egistrant has filed a report on and attestation to its managements assessment of the effectiveness of its internal control over financialreporting under Section 404(b)of the Sarbanes-Oxley Act(15 U.S.C.7262(b)by the registered public accounting firm that prepared or issued its audit report.If securi

31、ties are registered pursuant to Section 12(b)of the Act,indicate by check mark whether the financial statements of the registrant included in the filing reflect thecorrection of an error to previously issued financial statements.Indicate by check mark whether any of those error corrections are resta

32、tements that required a recovery analysis of incentive-based compensation received by any of theregistrants executive officers during the relevant recovery period pursuant to 240.10D-1(b).Indicate by check mark whether the registrant is a shell company(as defined in Rule 12b-2 of the Act).Yes No As

33、of June 30,2022(the last business day of the registrants most recently completed second fiscal quarter),the aggregate market value of the common stock held by non-affiliates of the registrant was$289,877,408 based upon the closing sale price as reported on the New York Stock Exchange.See Part II,Ite

34、m 5 of this Annual Report on Form 10-K for additional information.As of February 22,2023,there were 9,523,209 shares of the registrants common stock outstanding.Documents Incorporated by ReferenceCertain information required by Part III of this Annual Report on Form 10-K is incorporated herein by re

35、ference to the Proxy Statement for the registrants 2023 Annual Meetingof Stockholders,which is expected to be filed pursuant to Regulation 14A within 120 days after the end of the registrants fiscal year ended December 31,2022.REGIONAL MANAGEMENT CORP.ANNUAL REPORT ON FORM 10-KFiscal Year Ended Dece

36、mber 31,2022TABLE OF CONTENTSPageForward-Looking Statements1PART IITEM 1.Business2ITEM 1A.Risk Factors12ITEM 1B.Unresolved Staff Comments38ITEM 2.Properties38ITEM 3.Legal Proceedings38ITEM 4.Mine Safety Disclosures38PART IIITEM 5.Market for Registrants Common Equity,Related Stockholder Matters and I

37、ssuer Purchases of EquitySecurities39ITEM 6.Reserved41ITEM 7.Managements Discussion and Analysis of Financial Condition and Results of Operations42ITEM 7A.Quantitative and Qualitative Disclosures About Market Risk57ITEM 8.Financial Statements and Supplementary Data58ITEM 9.Changes in and Disagreemen

38、ts With Accountants on Accounting and Financial Disclosure98ITEM 9A.Controls and Procedures98ITEM 9B.Other Information98ITEM 9C.Disclosure Regarding Foreign Jurisdictions that Prevent Inspections99PART IIIITEM 10.Directors,Executive Officers and Corporate Governance100ITEM 11.Executive Compensation1

39、00ITEM 12.Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters100ITEM 13.Certain Relationships and Related Transactions,and Director Independence100ITEM 14.Principal Accounting Fees and Services100PART IVITEM 15.Exhibits,Financial Statement Schedules101ITEM

40、16.Form 10-K Summary108Signatures109Regional Management Corp.|2022 Annual Report on Form 10-K|1FORWARD-LOOKING STATEMENTSEach of the terms“Regional,”the“Company,”“we,”“us,”and“our”as used herein refers collectively to Regional ManagementCorp.and its wholly-owned subsidiaries,unless otherwise stated.

41、This Annual Report on Form 10-K includes“forward-looking statements”within the meaning of the safe harbor provisions ofthe Private Securities Litigation Reform Act of 1995,including,but not limited to,certain statements and disclosures contained in PartI,Item 1,“Business,”Part I,Item 1A,“Risk Factor

42、s,”and Part II,Item 7,“Managements Discussion and Analysis of FinancialCondition and Results of Operations.”These forward-looking statements include,but are not limited to,statements about ourstrategies,future operations,future financial position,future revenues,projected costs,expectations regardin

43、g demand andacceptance for our financial products,growth opportunities and trends in the market in which we operate,prospects,plans andobjectives of management,representations,and contentions,and are not historical facts.Forward-looking statements typically areidentified by the use of terms such as“

44、may,”“will,”“would,”“should,”“could,”“intend,”“expect,”“plan,”“project,”“anticipate,”“believe,”“estimate,”“predict,”“potential,”“continue,”and similar words,although some forward-looking statements areexpressed differently.We may not actually achieve the plans,intentions,or expectations disclosed in

45、 our forward-looking statements,and you should not place undue reliance on our forward-looking statements.The forward-looking statements included herein reflectand contain managements current judgment,and involve risks and uncertainties that could cause actual results,events,and/orperformance to dif

46、fer materially from the plans,intentions,and expectations disclosed in the forward-looking statements.Such risksand uncertainties include,without limitation,the risks set forth in Part I,Item 1A,“Risk Factors”in this Annual Report on Form 10-K.We do not intend to update any of these forward-looking

47、statements or publicly announce the results of or any revisions to theseforward-looking statements,other than as is required under the federal securities laws.The following discussion should be read in conjunction with,and is qualified in its entirety by reference to,our auditedconsolidated financia

48、l statements,including the notes thereto.?Regional Management Corp.|2022 Annual Report on Form 10-K|2PART IITEM 1.BUSINESS.OverviewWe are a diversified consumer finance company that provides installment loan products primarily to customers with limitedaccess to consumer credit from banks,thrifts,cre

49、dit card companies,and other lenders.As of December 31,2022,we operatedunder the name“Regional Finance”online and in branch locations in 18 states across the United States,serving 517,700 activeaccounts.Most of our loan products are secured,and each is structured on a fixed-rate,fixed-term basis wit

50、h fully amortizing equalmonthly installment payments,repayable at any time without penalty.We source our loans through our omni-channel platform,which includes our branches,centrally-managed direct mail campaigns,digital partners,and consumer website.We operate anintegrated branch model in which nea

51、rly all loans,regardless of origination channel,are serviced through our branch network withthe support of centralized sales,underwriting,service,collections,and administrative teams.This provides us with frequent in-person contact with our customers,which we believe improves our credit performance

52、and customer loyalty.Our goal is toconsistently grow our finance receivables and to soundly manage our portfolio risk,while providing our customers with attractiveand easy-to-understand loan products that serve their varied financial needs.Our core products are small and large installment loans.As a

53、 complement to our loan products,we offer our customersoptional payment and collateral protection insurance.Small Loans We offer small installment loans with cash proceeds to customers ranging from$500 to$2,500,with termsof up to 48 months.Our small loans are typically secured by non-essential house

54、hold goods and/or,to a lesser extent,alien on a vehicle,which may be an automobile,motorcycle,boat,or all-terrain vehicle.As of December 31,2022,we had287,000 small loans outstanding representing$481.6 million in finance receivables,or an average of approximately$1,700 per loan.In 2022,2021,and 2020

55、,interest and fee income from small loans contributed$160.4 million,$150.6million,and$151.5 million,respectively,to our total revenue.Large Loans We offer large installment loans with cash proceeds to customers ranging from$2,501 to$25,000,withterms between 18 and 60 months.Our large loans are typic

56、ally secured by non-essential household goods and/or avehicle.As of December 31,2022,we had 225,600 large loans outstanding representing$1.2 billion in finance receivables,or an average of approximately$5,400 per loan.In 2022,2021,and 2020,interest and fee income from large loanscontributed$288.5 mi

57、llion,$229.9 million,and$180.3 million,respectively,to our total revenue.Optional Payment and Collateral Protection Insurance Products We offer our customers optional payment andcollateral protection insurance relating to our loan products,including credit life insurance,accident and health insuranc

58、e,involuntary unemployment insurance,and personal property insurance.In 2022,2021,and 2020,insurance income,netcontributed$43.5 million,$35.5 million,and$28.3 million,respectively,to our total revenue.Through November 2022,we also offered indirect retail installment loans of up to$7,500.We ceased of

59、fering indirect retailinstallment loans in November 2022 to focus on growing our core loan portfolio,but we continue to own and service the loans thatwe previously originated.As of December 31,2022,we had 5,100 retail loans outstanding representing$9.6 million in financereceivables,or an average of

60、approximately$1,900 per loan.Industry,Customers,and PurposeWe operate in the consumer finance industry,in which consumers are generally described as super-prime(mostcreditworthy),prime,near-prime,non-prime,subprime,or deep-subprime(least creditworthy).Our customers typically have less-than-perfect c

61、redit profiles and,for that reason,are generally considered subprime,non-prime,or near-prime consumers.As aresult,our customers often do not qualify for prime financing from banks,thrifts,credit card providers,and other lenders.However,like prime consumers,our customers have a need and a desire to u

62、tilize credit.Notwithstanding that many lenders are unwilling to serve our customers,we believe that responsible,transparent,and fairlypriced credit products should be made available to our customers.We exist to serve that purpose,and accordingly,we offer ourcustomers access to credit through our af

63、fordable,easy-to-understand small and large loan products,which we price on fair terms inconsideration of the associated credit risk and servicing costs.The average annual percentage rate(“APR”)of our small loans originated in 2022 was 42.7%.Our large loans,which arereserved for higher credit qualit

64、y customers who meet more stringent underwriting requirements than those applied to small loanapplicants,had an average APR of 29.5%for loans originated in 2022.We believe that the rates on our products are significantlymore attractive than many other credit options available to our customers,such a

65、s payday,pawn,and title loans,which often comeRegional Management Corp.|2022 Annual Report on Form 10-K|3with APRs over 300%.Our loans are also safer and more favorably structured than loans offered by alternative financial serviceproviders.We underwrite our loans based on an applicants ability to r

66、epay,whereas payday,pawn,and title loans are typicallyunderwritten based on an ability to collect,either through access to the borrowers bank account or by repossession and sale ofcollateral.We also structure our loans on a fixed-rate,fixed-term basis with fully amortizing,equal monthly installment

67、paymentsthat are designed to be affordable for our customers and made over an average term of 22 months and 46 months for small andlarge loans,respectively(for loans originated in 2022).By comparison,payday,pawn,and title loans typically have balloon paymentsfollowing short terms of 14 to 60 days.Im

68、portantly,we further differentiate ourselves from alternative financial service providers by reporting our customerspayment performance to credit bureaus.This practice provides our customers with the opportunity to improve their credit profile byestablishing a responsible payment history with us and

69、,ultimately,to gain access to a wider range of credit options,including ourown.For example,in 2022,we worked with many of our deserving customers to refinance nearly 35,000 of our customers smallloans into large loans,representing$203.4 million in finance receivables at origination,and resulting in

70、a decrease in thesecustomers average APR from 42.2%to 30.2%.We also believe that,over time,many of our customers transition away from ourcompany to prime sources of credit.Our diversity of loan products with competitive,safe,and transparent pricing and terms,combined with the opportunity forour cust

71、omers to improve their credit history and profile,distinguishes us in the consumer finance market,provides us with acompetitive advantage,and allows us to serve an important purpose that is mutually beneficial to our customers,communities,employees,and stockholders.Business ModelOmni-Channel Platfor

72、m.Our omni-channel platform,which includes our branches,direct mail campaigns,digital partners,andconsumer website,enables us to offer a range of loan products to new,existing,and former customers throughout our markets.Webegan building our branch network over 30 years ago and have expanded the netw

73、ork to 345 branches in 18 states as ofDecember 31,2022.Our branch personnel market our products in a number of ways,including through a merchant referralprogram,customer referrals,direct telephone and mail solicitations of current and former customers,and by leveraging our directmail program and lea

74、ds generated by our digital affiliates and consumer website.Our direct mail campaigns include mailings of pre-screened convenience checks,pre-qualified offers,and invitations to apply,which enable us to market our products to millions ofcurrent and potential customers in a cost-effective manner.We h

75、ave also developed our consumer website and partnered withdigital lead generation sources to promote our products and facilitate loan applications via the internet.We believe that our omni-channel platform provides us with a competitive advantage by giving us broad access to our existing and former

76、customers andmultiple avenues to attract new customers.Attractive Products for Customers with Limited Access to Credit.Our flexible loan products,generally ranging from$500 to$25,000 with terms of up to 60 months,are competitively priced,easy to understand,and incorporate features designed to meetth

77、e varied financial needs and credit profiles of a broad range of consumers.This product diversity distinguishes us from monolinecompetitors and provides us with the ability to offer our customers new loan products as their credit profiles evolve,buildingcustomer loyalty and increasing the overall va

78、lue of customer relationships.Integrated Branch Model with Centralized Support.Our branch network serves as the foundation of our omni-channelplatform and the primary point of contact with our customers.Over 72%of our loan originations in 2022 were facilitated by one ofour branch locations,and nearl

79、y all loans,regardless of origination channel,are serviced through our branches,allowing us tomaintain frequent,in-person contact with our customers.By integrating loan origination and loan servicing at the branch level,ouremployees are able to maintain a relationship with our customers throughout t

80、he life of a loan.We believe this frequent-contact,relationship-driven lending model provides greater insight into potential payment difficulties,reduces credit risk,and allows us toassess the borrowing needs of our customers,better enabling us to offer them new loan products as their credit profile

81、s and needsevolve.In recent years,we have provided our branch network with increasing levels of centralized sales,underwriting,service,collections,and administrative support,and we plan to continue our investment in and testing of centralized support in the future.Consistent Portfolio Performance.Ov

82、er the past several years,we have maintained a sharp focus on credit quality by investingin highly qualified personnel,refining underwriting practices,developing custom credit scorecards,streamlining procedures,automating underwriting decisions,and improving reporting capabilities.These investments

83、allow us to control the credit quality ofour portfolio,maintain compliance with evolving state and federal law,and react quickly whenever market dynamics may change.We have also expanded our centralized collections department and provided our branches with improved collections tools,training,and inc

84、entives.?Regional Management Corp.|2022 Annual Report on Form 10-K|4Demonstrated Organic Growth.We have grown our total finance receivables by 103.8%,from$834.0 million at December 31,2017 to$1.7 billion at December 31,2022,a compound annual growth rate(“CAGR”)of 15.3%.More importantly,we have grown

85、our core small loan and large loan finance receivables by 128.5%,from$739.4 million at December 31,2017 to$1.7 billion atDecember 31,2022,a CAGR of 18.0%.This receivables growth has driven a revenue increase of 86.2%,from$272.5 million in 2017to$507.2 million in 2022,a CAGR of 13.2%.Our portfolio gr

86、owth has come from expanding our geographic presence,growing ourfinance receivable portfolios within existing branches,and developing new products and channels,including through digital leadgeneration.Between 2018 and 2022,we entered nine new states,and since 2020,we have introduced new technologies

87、 andmarketing strategies to enable remote loan closings and to extend the geographic reach of our branches.Historically,our brancheshave rapidly increased their outstanding finance receivables during the early years of operations and generally achieved profitabilitywithin one year of opening.Experie

88、nced Management Team.Our executive and senior operations management teams consist of individuals experiencedin installment lending and other consumer finance services.Our Chief Executive Officer has over 30 years of experience in consumerfinancial services,our Chief Operating Officer has over 35 yea

89、rs of experience in consumer financial services,our Chief FinancialOfficer has over 20 years of financial services experience,and our Chief Credit Risk Officer has 20 years of financial and consumerlending experience.As of December 31,2022,our state operations vice presidents averaged nearly 26 year

90、s of industry experienceand 11 years of service at Regional,while our associate vice presidents and district supervisors averaged nearly 23 years of industryexperience and 8 years of service with Regional.Our executive and senior operations management team members intend toleverage their experience

91、and expertise in consumer lending to grow our business,deliver high-quality service to our customers,andcarefully manage our credit risk.StrategiesExpand Our Geographic Presence.We expect to continue to grow the receivables,revenue,and profitability of our existingbranches,to open new branches withi

92、n our existing geographic footprint,and to expand our operations into new states.Establishinglocal contact with our customers through our branch network is a key to our frequent-contact,relationship-driven lending model.We believe that there remains substantial opportunity to grow the finance receiv

93、able portfolios of our existing branches bycontinuing our focus on large loan originations and by cross-selling new loan products to our existing customers.During 2022,weexpanded into Mississippi,Indiana,California,Louisiana,and Idaho.We anticipate that as our newer branches mature,their revenuewill

94、 grow faster than our overall same-store revenue growth rate.We believe there is sufficient demand for consumer financeservices to continue new branch openings in certain of the states where we currently operate,allowing us to capitalize on ourexisting infrastructure and experience in these markets.

95、We also intend to explore opportunities for growth in states outside of ourexisting geographic footprint that enjoy favorable operating environments.We plan to expand our operations to one or twoadditional states by the end of 2023,and over time,we expect to have a national presence.Leverage Direct

96、Mail Marketing.Direct mail campaigns are launched throughout the year but are weighted to coincide withseasonal consumer demand.In addition,we mail convenience checks in new markets as soon as new branches are open,whichdevelops a customer base and builds finance receivables for these new branches.W

97、e plan to continue to invest in and to improvethe targeting criteria,offer strategies,and testing protocols of our direct mail campaigns,which we believe will enable us toefficiently grow our receivables with improved credit performance.We expect that these efforts will allow us to increase volume a

98、tour branches by adding new customers,recapturing former customers,and creating opportunities to offer new loan products to ourexisting customers.Improve Our Digital Capabilities.In order to better attract and serve customers who prefer to conduct business digitally,wemake an online loan application

99、 available on our consumer website,generate customer leads through digital partners,and provideour customers with online account management capabilities.Over the past few years,we have invested heavily in our digitalacquisition channel and servicing tools.For example,we rolled out an improved digita

100、l prequalification experience for ourcustomers,including expanded integrations with existing and new digital affiliates and lead generators.We also began testing adigital origination product and channel for new customers,through which new loans can be fulfilled entirely online withoutintervention by

101、 our personnel,and we launched an enhanced customer portal.These efforts enabled us to grow new digitallysourced volumes as a percentage of total new customer volumes to nearly 30%in 2022,compared to 27%in 2021.In the future,wewill continue our focus on the digital channel.We plan to expand the test

102、ing of our digital origination product and channel to newgeographies and improve the customer experience.We also expect to complete the development of our mobile app and furtherenhancements to our customer portal,allowing our customers easy access to payment functionality and additional features.Our

103、investment in our digital channel allows us to add capabilities,improve efficiencies,enhance the customer experience,and test newmechanisms for lead generation to diversify and expand our new business acquisition opportunities.Regional Management Corp.|2022 Annual Report on Form 10-K|5Enhance Our Pr

104、oducts,Channels,and Services.Over time,we intend to improve our existing product offerings,to introducenew products and services,and to capture customers through new channels and partnerships.For example,in 2020,we introducedan enhanced auto-secured large loan product,through which we offer larger a

105、uto-secured loans to some of our highest creditquality customers.As of the end of 2022,this product exceeded$100 million in total portfolio.In the future,we will continue toassess new credit and non-credit products and services and expand the channels and partnerships through which we acquirecustome

106、rs.Maintain Sound Underwriting and Credit Control.We have invested heavily in our credit and collections functions.We plan tocontinue to do so in the future by maintaining highly qualified employees dedicated to managing credit risk,refining ourunderwriting models,and improving our collection effort

107、s through both our branch operations and our centralized collectionsdepartment.In early 2018,we completed the implementation of our new loan origination and servicing software platform,whichallows us to automate our underwriting decisions,among other benefits.In addition,we began to integrate custom

108、 credit modelsinto our automated underwriting processes during the second half of 2018.We completed the rollout of our custom credit modelsto all of our states in 2019 and began seeing the impact in our results in late 2019.In 2022,we introduced our next generationcustom credit model,a new proprieta

109、ry model that we expect will provide significant advancements in underwriting capabilities byutilizing sophisticated modeling algorithms that leverage new alternative data sources to drive more predictable outcomes andmake better credit decisions at the margin.Through these efforts and others,we pla

110、n to continue to carefully manage our creditexposure as we grow our business,offer new products,access new channels,and enter new markets.Carefully Manage Our G&A Expenses.We have made significant investments in our business over the past several years,including by increasing our marketing spend to

111、drive new business,expanding our branch network,hiring operations employees toservice our growing finance receivable portfolio,and improving our credit,information technology,and data and analyticscapabilities.However,during that time,we also remained keenly focused on driving operating leverage thr

112、ough the prudentmanagement of our expenses.Between 2018 and 2022,our operating expense ratio(annualized general and administrativeexpenses as a percentage of average net finance receivables)decreased from 16.1%to 14.5%.As we grow our business,we willremain vigilant in our management of general and a

113、dministrative expenses,with the goal of decreasing such expenses as apercentage of average net finance receivables over time.Loan ProductsWe offer small and large installment loans to our customers.Our underwriting standards focus on our customers ability toaffordably make loan payments out of their

114、 discretionary income,with the value of pledged collateral serving as a creditenhancement rather than the primary underwriting criterion.The interest rates,fees and other charges,maximum principalamounts,and maturities for our loans vary from state to state,depending on the competitive environment a

115、nd relevant laws andregulations.Small and large loans are originated by our branch network,by our centralized sales and service team,digitally through ourconsumer website,or through our convenience check direct mail campaigns.Our convenience check direct mail loan offers enableprospective customers

116、to enter into a loan with us by cashing or depositing the check attached to the loan offer,thereby agreeing tothe terms of the loan as prominently set forth on the check and accompanying disclosures.When a customer enters into a loan bycashing or depositing the convenience check,our personnel gather

117、 additional information on the borrower to assist in servicing theloan.For loans originated by our branch network or centralized sales and service team,we consider numerous factors in evaluatinga potential customers creditworthiness,such as unencumbered income,debt-to-income ratio,length of current

118、employment,duration of residence,and a credit report detailing the applicants credit history.Our loan origination and servicing softwareplatform guides our branch personnel through the credit application process and automates much of the underwriting,withunderwriting exceptions generally subject to

119、review and approval by a senior operations or centralized underwriting team member.For convenience check loans,each prospect that we solicit has been pre-screened through a major credit bureau against ourunderwriting criteria,which includes an evaluation of the recipients credit score,bankruptcy his

120、tory,and a number of additionalcredit attributes relevant to the recipients likely ability and willingness to repay the offered convenience check loan.Loan renewals are also an important part of our business.Our customers use renewals to extend and expand their lendingrelationships with us.We genera

121、lly offer loan renewals to existing customers who have demonstrated an ability and willingness torepay amounts owed to us.Renewals typically refinance one or more of a customers loans into a single new loan,which in somecases will be for a larger principal balance than the customers original loan,th

122、ough we permit renewals of existing loans at or belowthe original loan amount.In evaluating a loan for renewal,in addition to our standard underwriting requirements,we are able to?Regional Management Corp.|2022 Annual Report on Form 10-K|6take into consideration the customers prior payment performan

123、ce with us,which we believe is a very strong indicator of thecustomers future credit performance.Small Loans.In 2022,the average originated principal balance and term for our small loans were$2,069 and 22 months,respectively.The average yield we earned on our portfolio of small loans was 35.2%in 202

124、2.The following table sets forth thedistribution of our small loan finance receivable portfolio by state as of the dates indicated.At December 31,20182019202020212022Texas34%39%37%35%33%South Carolina16%13%12%12%10%North Carolina15%15%17%16%16%Alabama13%11%11%10%10%All Other States22%22%23%27%31%Tot

125、al100%100%100%100%100%The following table sets forth the total number of small loans,total small loan finance receivables,and average size per loanby state as of December 31,2022.Numberof LoansNet FinanceReceivablesAverage SizePer Loan(In thousands)Texas93,082$162,018$1,741South Carolina25,23446,202

126、1,831North Carolina44,62276,1251,706Alabama26,30745,8361,742All Other States97,788151,4241,548Total287,033$481,605$1,678Large Loans.In 2022,our average originated principal balance and term for large loans were$5,993 and 46 months,respectively.The average yield we earned on our portfolio of large lo

127、ans was 27.1%for 2022.The following table sets forth thedistribution of our large loan finance receivable portfolio by state as of the dates indicated.At December 31,20182019202020212022Texas27%27%29%31%33%South Carolina21%19%18%15%12%North Carolina16%15%14%15%15%All Other States36%39%39%39%40%Total

128、100%100%100%100%100%The following table sets forth the total number of large loans,total large loan finance receivables,and average size per loan bystate as of December 31,2022.Numberof LoansNet FinanceReceivablesAverage SizePer Loan(In thousands)Texas70,477$392,533$5,570South Carolina27,581147,8485

129、,361North Carolina35,031183,8235,247All Other States92,500483,9815,232Total225,589$1,208,185$5,356Insurance and Ancillary ProductsWe also offer our customers various optional payment and collateral protection insurance products as a complement to ourlending operations.Our primary insurance products

130、include optional credit life insurance,accident and health insurance,involuntaryRegional Management Corp.|2022 Annual Report on Form 10-K|7unemployment insurance,and personal property insurance.These insurance products are optional and not a condition of the loan,and we do not sell insurance to non-

131、borrowers.Our insurance products,including the types of products offered and their terms andconditions,vary from state to state in compliance with applicable laws and regulations.Insurance policy premiums,claims,andexpenses are included in our results of operations as insurance income,net in the con

132、solidated statements of comprehensiveincome.In 2022,insurance income,net was$43.5 million,or 8.6%of our total revenue.Credit life insurance provides for the payment in full of the borrowers credit obligation to the lender in the event of theborrowers death and,in some states,may provide a payment to

133、 a secondary beneficiary listed by the borrower.Credit accident andhealth insurance provides for the repayment of certain loan installments to the lender that come due during an insureds period ofincome interruption resulting from disability from illness or injury.Credit involuntary unemployment ins

134、urance provides forrepayment of certain loan installments in the event that the borrower is no longer employed as the result of a qualifying event,suchas a layoff or reduction in workforce.Credit personal property insurance provides for payment following accidental loss of,ordamage to,personal prope

135、rty collateral resulting from certain casualty events.We require that customers maintain propertyinsurance on any personal property securing loans and offer customers the option of providing proof of such insurance purchasedfrom a third party(such as homeowners or renters insurance)in lieu of purcha

136、sing property insurance from us.We also requireproof of insurance on any vehicles securing loans,and in select markets,we offer vehicle single interest insurance on vehicles usedas collateral on small and large loans.All customers purchasing these types of insurance from us are required to sign mult

137、iple statements affirming that theyunderstand that their purchase of insurance is optional and not a condition of the loan.In addition,a customer may cancelpurchased insurance at any time during the life of the loan,including in connection with an early payoff or loan refinancing.Customers who cance

138、l within thirty(30)days of the date of purchase receive a full refund of the insurance premium,and customerswho cancel thereafter receive a refund of the unearned portion of the insurance premium.Apart from the various optional payment and collateral protection insurance products that we offer to ou

139、r customers,oncertain loans,we also collect a fee from our customers and,in turn,purchase non-file insurance from an unaffiliated insurancecompany for our benefit in lieu of recording and perfecting our security interest in personal property collateral.Non-file insuranceprotects us from credit losse

140、s where,following an event of default,we are unable to take possession of personal property collateralbecause our security interest is not perfected(for example,in certain instances where a customer files for bankruptcy).In suchcircumstances,non-file insurance generally will pay to us an amount equa

141、l to the lesser of the loan balance or the collateral value,with such claims payment lowering our net credit losses.We market and sell insurance policies as an agent of an unaffiliated insurance company,within the limitations established byour agency contracts with the unaffiliated insurance company

142、.We then remit to the unaffiliated insurance company the premiumswe collect,net of refunds on prepaid loans and net of commission on new business.The unaffiliated insurance company then cedesto our wholly-owned insurance subsidiary,RMC Reinsurance,Ltd.,the net insurance premium revenue and the assoc

143、iated insuranceclaims liability for all insurance products,including the non-file insurance that we purchase.Life insurance premiums are ceded aswritten,and non-life insurance premiums are ceded as earned.In accepting the premium revenue and associated claims liability,RMC Reinsurance,Ltd.acts as re

144、insurer for all insurance products that we sell to our customers and for the non-file insurance thatwe purchase.RMC Reinsurance,Ltd.pays the unaffiliated insurance company a ceding fee for the continued administration of allinsurance products.In addition,in select states,we offer an“Auto Plus Plan”a

145、uto club product that is administered and serviced through a third-party provider.The product generally provides certain automobile,home,travel,and other services and benefits to customers,including emergency towing and roadside assistance,emergency locksmith service,automobile repair reimbursement,

146、stolen carexpense benefit,automobile insurance deductible reimbursement,limited legal services,and various travel and other discounts.TheAuto Plus Plan is not an insurance product,and therefore,it is not included in our results of operations as insurance income,net,butrather,it is included as part o

147、f revenue under other income.However,as with the optional insurance products that we offer,anycustomer purchasing an Auto Plus Plan acknowledges that the purchase is optional and not a condition of the loan and that the planmay be cancelled within 30 days for a full refund.Branch NetworkOur branches

148、 are generally located in visible,high-traffic locations,such as shopping centers or,to a lesser extent,commercialoffice buildings.We believe that our branches have an open,welcoming,and hospitable layout.In evaluating whether to locate abranch in a particular community,we examine several factors,in

149、cluding the demonstrated demand for consumer finance,theregulatory and political climate,and the availability of suitable employees to staff,manage,and supervise the new branch.?Regional Management Corp.|2022 Annual Report on Form 10-K|8The following table sets forth the net finance receivables per

150、branch based on maturity:Age of Branch(As of December 31,2022)Net FinanceReceivablesPer Branch as ofDecember 31,2022PercentageIncreaseFrom PriorAge CategoryNumber ofBranches(In thousands)Branches open less than one year$2,61216Branches open one to three years$4,47871.4%28Branches open three to five

151、years$3,601(19.6)%35Branches open five years or more$5,28646.8%266All branches$4,926345The following table sets forth the average operating income contribution per branch for the year ended December 31,2022,based on maturity of the branch.Age of Branch(As of December 31,2022)Average BranchOperating

152、IncomeContributionPercentage IncreaseFrom Prior AgeCategoryNumber ofBranches(In thousands)Branches open less than one year$(5)16Branches open one to three years$2915,920.0%28Branches open three to five years$268(7.9)%35Branches open five years or more$661146.6%266All branches$560345Historically,net

153、finance receivables per branch and average branch operating income contribution have increased as ourbranches mature.Beginning in 2021 with our expansion to Illinois,we began to implement a lighter branch footprint strategy,pursuant to which we are leveraging our new technology and digital capabilit

154、ies to service a wider geographic area in new branchlocations.As a result,our new branches opened in 2021 and 2022 have on average grown their net finance receivables andoperating income contribution at a faster pace than branches opened prior to 2021.As a result of this strategy,the net financerece

155、ivables per branch and the average branch operating income contribution of branches open one to three years exceed that ofbranches open three to five years in the tables above.We calculate the average branch contribution as total revenues generated by the branch less the expenses directlyattributabl

156、e to the branch,including the provision for losses and operating expenses,such as personnel,lease,and interestexpenses.General corporate overhead,including management salaries,is not attributed to any individual branch.Accordingly,thesum of branch contributions from all of our branches is greater th

157、an our income before taxes.Human CapitalAs of December 31,2022,we had 1,991 employees,including 1,603 employees on our field operations teams and 388employees(including centralized customer service and collections staff)on our headquarters teams.All of our employees arelocated within the United Stat

158、es,and none are covered by a collective bargaining agreement.We work diligently to attract the besttalent in order to meet the current and future demands of our business,and we have demonstrated a history of investing in ourworkforce by offering competitive compensation,comprehensive benefits,and de

159、velopment opportunities.In addition,to ensurethat we provide a rewarding experience for our employees,we engage independent third parties to conduct periodic employeeengagement surveys,enabling us to regularly measure organizational culture and engagement and to improve upon the employeeexperience,w

160、hich in turn drives a superior customer experience.We are also committed to fostering,cultivating,and preserving a culture of diversity,equity,and inclusion(“DE&I”).Webelieve that the collective sum of the individual differences,life experiences,knowledge,inventiveness,self-expression,uniquecapabili

161、ties,and talent that our employees invest in their work represent a significant part of our culture,reputation,andachievement.We believe that an emphasis on DE&I drives value for our employees,customers,and stockholders,and that our DE&Icommitment enables us to better serve our communities.In 2022,i

162、n furtherance of our DE&I objectives,we engaged a third-partyconsultant to complete a DE&I assessment and make recommendations as to how we can further promote DE&I within ourorganization.Regional Management Corp.|2022 Annual Report on Form 10-K|9We also offer our employees a variety of training and

163、 development opportunities.New employees complete a comprehensivetraining curriculum that focuses on the company-and position-specific competencies needed to be successful.The training includesa blended approach utilizing eLearning modules,hands-on exercises,webinars,and assessments.Training content

164、 is focused on ouroperating policies and procedures,as well as several key compliance areas.Incentive compensation for new employees is contingentupon the successful and timely completion of the required new hire training curriculum.All current employees are also required tocomplete annual complianc

165、e training and re-certification.Additional management and developmental training is provided for thoseemployees seeking to advance within our company.For additional information on the ways that we seek to empower our employees,please visit our corporate responsibilitywebsite at information contained

166、 on our corporate responsibility website isnot and should not be viewed as being incorporated by reference into this Annual Report on Form 10-K.Payment and Loan ServicingWe have implemented company-wide payment and loan servicing policies and procedures,which are designed to maintainconsistent portf

167、olio performance and to ensure regulatory compliance.Our district supervisors,associate vice presidents,state vicepresidents,and compliance and internal audit teams regularly review servicing and collection records to ensure compliance with ourpolicies and procedures.Our centralized management infor

168、mation system enables regular monitoring of branch portfolio metrics bymanagement,and the compensation opportunities of our operations employees and senior management have a significantperformance component that is closely tied to credit quality,among other defined performance targets.The responsibi

169、lity for the servicing and collection of each loan generally rests with the originating branch.Borrowers who havesigned up for online account access have on-demand access to their account information through Regionals website.In addition,borrowers may elect to receive automated,one-way text messages

170、 with information regarding their account,including paymentreminders.Borrowers have the option of making payments(i)in person at a branch where they may pay by cash,check,moneyorder,debit card,or immediate,one-time future,or recurring ACH,(ii)through our customer portal via debit card or immediate,o

171、ne-time future,or recurring ACH,or(iii)by immediate or one-time future debit card or ACH over the phone.In the fourth quarterof 2022,approximately 80%(by dollar amount)of customer payments were made by debit card or ACH.If a loan becomes severely delinquent,a branch may receive co-collection assista

172、nce from our centralized servicing team orthird-party collector.Our philosophy is to work with customers experiencing payment difficulties.If a customer is unable to makethe required payments to bring his or her loan current,acceptable solutions to remedy a past due loan may include deferral of apay

173、ment,loan renewal,or settlement.All solutions are intended to enable the customer to meet his or her current and futureobligations in a manner that we believe will mitigate our risk,while also complying with state and federal laws and regulations,aswell as our policies and procedures.Customers gener

174、ally are limited to two deferrals of their monthly payment in a rolling twelve-month period unless it isdetermined that an exception is warranted(e.g.due to a natural disaster or pandemic).For example,since the COVID-19 pandemic,we have temporarily allowed up to three deferrals in a rolling twelve-m

175、onth period.We generally limit the refinancing of delinquentloans to those customers who have made recent payments and for whom we have verified current employment,and we do notcharge any origination fees on the refinancing of a severely delinquent loan.We believe that refinancing delinquent loans f

176、or certaindeserving customers who have made periodic payments allows us to help customers resolve temporary financial setbacks and repairor sustain their credit.During 2022,we refinanced approximately$13.5 million of loans that were 60 or more days contractually pastdue,representing approximately 0.

177、8%of our total loan originations in 2022.As of December 31,2022,the outstanding balance ofsuch refinanced loans was$11.2 million,or 0.7%of finance receivables as of such date.We may also agree to settle a past-due loanby accepting less than the full principal balance owed.A settlement is only used i

178、n certain limited cases and is only offered once wehave determined that we are unlikely to collect the entire outstanding balance of the loan.For seriously delinquent accounts,we may seek legal judgments or pursue repossession of collateral.We typically initiaterepossession efforts only when we have

179、 exhausted other means of collection and,in the opinion of management,the customer isunlikely to make further payments.We sell substantially all repossessed collateral through sales conducted by independent auctionorganizations,after the required post-repossession waiting period.Generally,we charge

180、off loans during the month that the loanbecomes 180 days contractually delinquent.Accounts without a lien on a vehicle in a confirmed Chapter 7 or Chapter 13 bankruptcyare charged off at 60 days contractually delinquent,subject to certain exceptions.Deceased borrower accounts are charged off inthe m

181、onth following the proper notification of passing,with the exception of borrowers with credit life insurance.We sell most ofour charged-off accounts to third-party debt buyers.?Regional Management Corp.|2022 Annual Report on Form 10-K|10Information TechnologyWe utilize a loan origination and servici

182、ng platform offered by Nortridge Software,LLC(“Nortridge”)both to originate loansand to service our loan portfolio.We have invested in customizing the Nortridge platform to meet our needs based upon our specificproducts,processes,and reporting requirements.The Nortridge custom decision engine utiliz

183、es application information and a creditreport detailing the applicants credit history to generate an initial credit decision and to guide our branch employees through theloan origination process to the final credit decision.Throughout the life of the loan,our employees utilize Nortridge to,among oth

184、erthings,enter payments,generate collection queues,and log collection activity.Nortridge also facilitates electronic and recurringpayments,automated text messaging,and customer account access through a customer portal.Nortridge logs and maintains,withinour centralized information systems,a permanent

185、 record of the loan origination and servicing approvals and processes,and permitsall levels of branch and centralized management to review the individual and collective performance of all branches for which theyare responsible on a daily basis.We intend to continue to enhance the Nortridge platform

186、to further leverage its capabilities and tomeet our evolving needs.CompetitionThe consumer finance industry is highly fragmented,with numerous competitors.We compete with several nationalcompanies operating greater than 300 branch locations each,a handful of smaller,regionally-focused companies with

187、 between 100and 300 branches in certain of the states in which we operate,and many independent operators with fewer than 100 branches.Webelieve that competition between installment consumer loan companies occurs primarily on the basis of price,breadth of loanproduct offerings,flexibility of loan ter

188、ms offered,and the quality of customer service provided.While underbanked customers mayalso use alternative financial services providers,such as title lenders,payday lenders,and pawn shops,these providers productsoffer different terms and typically carry substantially higher interest rates and fees

189、than our installment loans.Accordingly,webelieve that alternative financial services providers are not an attractive option for customers who meet our underwriting standards,which are generally stricter than the underwriting standards of alternative financial services providers.Our small and large l

190、oans alsocompete with pure online lenders,peer-to-peer lenders,and issuers of non-prime credit cards.SeasonalityOur loan volume and contractual delinquency follow seasonal trends.Demand for our loans is typically highest during thesecond,third,and fourth quarters,which we believe is largely due to c

191、ustomers borrowing money for vacation,back-to-school,andholiday spending.Loan demand has generally been the lowest during the first quarter,which we believe is largely due to the timingof income tax refunds.Delinquencies generally reach their lowest point in the first half of the year and rise in th

192、e second half of theyear.Changes in quarterly growth or liquidation could result in larger allowance for credit loss releases in periods of portfolioliquidation,and larger provisions for credit losses in periods of portfolio growth.Consequently,we experience seasonal fluctuationsin our operating res

193、ults.However,changes in macroeconomic factors,including inflation,rising interest rates,and geopoliticalconflict,have impacted our typical seasonal trends for loan volume and delinquency.Government RegulationConsumer finance companies are subject to extensive regulation,supervision,and licensing und

194、er various federal,state,andlocal statutes,regulations,and ordinances.Many of these laws impose detailed constraints on how we originate loans,offeroptional products,collect on debt,and otherwise operate our business.The software that we use to originate loans is designed inpart to aid in compliance

195、 with all applicable lending laws and regulations.State Lending Regulation.We are regulated by state agencies that regularly audit our branches and operations.In general,most state statutes establish maximum loan amounts and interest rates,as well as the types and maximum amounts of fees andinsuranc

196、e premiums that we may charge for both direct and indirect lending.These specific allowable charges vary by state.Inaddition,state laws regulate the keeping of books and records and other aspects of the operation of consumer finance companies,and state and federal laws regulate account collection pr

197、actices.State agency approval is required to open new branches,and eachof our branches is separately licensed under the laws of the state in which the branch is located.Licenses granted by the regulatoryagencies in these states are subject to annual renewal and revocation for failing to comply with

198、applicable state and federal laws andregulations.In the states in which we currently operate,licenses may be revoked only after an administrative hearing.We believewe are in compliance with state laws and regulations applicable to our lending operations in each state.State Insurance Regulation.Premi

199、ums and charges for optional collateral and credit protection insurance products are set ator below authorized statutory rates and are stated separately in our disclosures to customers,as required by the Truth in LendingAct and by various applicable state laws.We are also subject to state laws and r

200、egulations governing insurance agents in the statesin which we sell insurance.State insurance regulations require that insurance agents be licensed and limit the premium amountRegional Management Corp.|2022 Annual Report on Form 10-K|11charged for such insurance.Our captive insurance subsidiary is r

201、egulated by the insurance authorities of the Turks and Caicos Islandsof the British West Indies,where the subsidiary is organized and domiciled.Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010(the“Dodd-Frank Act”).At the federal level,Congressenacted comprehensive financial regulato

202、ry reform legislation in 2010.A significant focus of the law,known as the Dodd-Frank Act,is heightened consumer protection.The Dodd-Frank Act established the Consumer Financial Protection Bureau(the“CFPB”),whichhas regulatory,supervisory,and enforcement powers over providers of consumer financial pr

203、oducts and services,including explicitsupervisory authority to examine and require registration of non-depository lenders and to promulgate rules that can affect thepractices and activities of lenders.The Dodd-Frank Act and the regulations promulgated thereunder may affect our operations through inc

204、reased oversight offinancial services products by the CFPB and the imposition of restrictions on the terms of certain loans.The CFPB has significantauthority to implement and enforce federal consumer finance laws,including the protections established in the Dodd-Frank Act,aswell as the authority to

205、identify and prohibit unfair,deceptive,and abusive acts and practices.To that end,the Dodd-Frank Act givesthe CFPB the authority to establish supervisory authority over a nonbank covered person that it has reasonable cause to determineis engaging,or has engaged,in conduct that poses risks to consume

206、rs.The Dodd-Frank Act also gives the CFPB the authority to examine and regulate large non-depository financial companies andgives the CFPB authority over entities deemed by rule to be a“larger participant of a market for other consumer financial productsor services.”The CFPB contemplates regulating

207、the installment lending industry as part of the“consumer credit and relatedactivities”market.However,this so-called“larger participant rule”will not impose substantive consumer protection requirements,but rather will provide to the CFPB the authority to supervise larger participants in certain marke

208、ts by requiring reports andconducting examinations to ensure,among other things,that larger participants are complying with existing federal consumerfinancial laws.While the CFPB has defined a“larger participant”standard for certain markets,such as the debt collection,automobile finance,and consumer

209、 reporting markets,it has not yet acted to define“larger participant”in the traditional installmentlending market.In addition to the grant of certain regulatory powers to the CFPB,the Dodd-Frank Act gives the CFPB authority to pursueadministrative proceedings or litigation for violations of federal

210、consumer financial laws.In these proceedings,the CFPB can obtaincease and desist orders(which can include orders for restitution or rescission of contracts,as well as other kinds of affirmative relief)and monetary penalties.Also,where a company has violated Title X of the Dodd-Frank Act or CFPB regu

211、lations thereunder,theDodd-Frank Act empowers state attorneys general and state regulators to bring civil actions to remedy violations of state law.Other Federal Laws and Regulations.In addition to the Dodd-Frank Act and state and local laws,regulations,and ordinances,numerous other federal laws and

212、 regulations affect our lending operations.These laws include the Truth in Lending Act,the EqualCredit Opportunity Act,the Fair Credit Reporting Act,the Servicemembers Civil Relief Act,the Military Lending Act,the Gramm-Leach-Bliley Act,and in each case the regulations thereunder,and the Federal Tra

213、de Commissions Credit Practices Rule.These lawsrequire us to provide complete disclosure of the principal terms of each loan to the borrower prior to the consummation of the loantransaction,prohibit misleading advertising,protect against discriminatory lending practices,govern the manner in which we

214、 reportcustomer information to consumer reporting agencies,govern the terms of loans to servicemembers,and proscribe unfair creditpractices.Truth in Lending Act.Under the Truth in Lending Act and Regulation Z promulgated thereunder,we must disclose certainmaterial terms related to a credit transacti

215、on,including,but not limited to,the annual percentage rate,finance charge,amount financed,total of payments,the number and amount of payments,and payment due dates to repay theindebtedness.Equal Credit Opportunity Act.Under the Equal Credit Opportunity Act and Regulation B promulgated thereunder,wec

216、annot discriminate against any credit applicant on the basis of any protected category,such as race,color,religion,national origin,sex,marital status,or age.We are also required to make certain disclosures regarding consumer rightsand advise customers whose credit applications are not approved of th

217、e reasons for the denial.Fair Credit Reporting Act.Under the Fair Credit Reporting Act,we must provide certain information to customers whosecredit applications are not approved on the basis of a report obtained from a consumer reporting agency,promptlyupdate any credit information reported to a cre

218、dit reporting agency about a customer,and have a process by whichcustomers may inquire about credit information furnished by us to a consumer reporting agency.Servicemembers Civil Relief Act.The Servicemembers Civil Relief Act is designed to ease legal and financial burdens onmilitary personnel and

219、their families during active-duty status.We may be required to reduce interest rates on“pre-?Regional Management Corp.|2022 Annual Report on Form 10-K|12service”debts incurred by servicemembers,and we may be prohibited from pursuing certain forms of legal action againstservicemembers,such as default

220、 judgments,during periods of active duty.Military Lending Act.The Military Lending Act applies to active duty servicemembers and their covered dependents.Weare prohibited from charging a borrower covered under the Military Lending Act more than a 36%Military AnnualPercentage Rate,which includes cert

221、ain costs associated with the loan in calculating the interest rate.Gramm-Leach-Bliley Act.Under the Gramm-Leach-Bliley Act,we must protect the confidentiality of our customers non-public personal information and disclose information on our privacy policy and practices,including with regard to thesh

222、aring of customers non-public personal information with third parties.This disclosure must be provided at the time thecustomer relationship is established and,in some cases,at least annually thereafter.Credit Practices Rule.The Federal Trade Commissions Credit Practices Rule limits the types of prop

223、erty we may accept ascollateral to secure a consumer loan.Violations of these statutes,laws,and regulations may result in actions for damages,claims for refund of payments made,certain fines and penalties,injunctions against certain practices,and the potential forfeiture of rights to repayment of lo

224、ans.Inaddition,because we utilize third-party debt collectors,we are responsible for oversight of their procedures and controls,as theypertain to our collection activities.For a discussion regarding how risks and uncertainties associated with the current regulatoryenvironment may impact our future e

225、xpenses,net income,and overall financial condition,see Part I,Item 1A,“Risk Factors.”Additional InformationThe Companys principal internet address is .The Company provides its Annual Reports onForm 10-K,Quarterly Reports on Form 10-Q,and Current Reports on Form 8-K,and all amendments to those report

226、s,free of chargeon ,as soon as reasonably practicable after they are electronically filed with,or furnished to,theSecurities and Exchange Commission.The Companys consumer website is .The information contained on,or that can be accessed through,the Companys websites is not incorporated by reference i

227、nto this Annual Report on Form 10-K.The Company has included its website addresses as factual references and does not intend the website addresses to be active linksto such websites.ITEM 1A.RISK FACTORS.We operate in a rapidly changing environment that involves a number of risks,some of which are be

228、yond our control.Thefollowing discussion highlights some of the risks that may affect our future operating results.These are the risks and uncertaintiesthat we believe are the most important for you to consider,but the risks described below are not the only risks facing our company.Additional risks

229、and uncertainties not presently known to us,that we currently deem immaterial,or that are similar to those faced byother companies in our industry or in business in general,may also impair our business operations.If any of the following risks oruncertainties occurs,continues,or worsens,our business,

230、financial condition,and operating results would likely suffer.You shouldcarefully consider the risks described below together with the other information set forth in this Annual Report on Form 10-K.Risk Factor SummaryOur business is subject to a number of material risks that may adversely affect our

231、 company.These risks are discussed ingreater detail below,and include,but are not limited to,risks related to:Risks related to our business and operationsManaging our growth effectively,implementing our growth strategy,and opening new branches as planned;Our convenience check strategy;Our policies a

232、nd procedures for underwriting,processing,and servicing loans;Our ability to collect on our loan portfolio;Our insurance operations;Exposure to credit risk and repayment risk,which risks may increase in light of adverse or recessionary economicconditions;The implementation of evolving underwriting m

233、odels and processes,including as to the effectiveness of our customscorecards;Changes in the competitive environment in which we operate or a decrease in the demand for our products;Regional Management Corp.|2022 Annual Report on Form 10-K|13Geographic concentration of our loan portfolio;Failure of

234、third-party service providers,including those providing information technology products;Changes in economic conditions in the markets we serve,including levels of unemployment and bankruptcies;Our ability to achieve successful acquisitions and strategic alliances;Our ability to make technological im

235、provements as quickly as our competitors;Security breaches,cyber-attacks,failures in our information systems,or fraudulent activity;Our ability to originate loans;Our reliance on information technology resources and providers,including the risk of prolonged system outages;Changes in current revenue

236、and expense trends,including trends affecting delinquencies and credit losses;Any future public health crises(including the resurgence of COVID-19),including the impact of such crisis on ouroperations and financial condition;Changes in operating and administrative expenses;The departure,transition,o

237、r replacement of key personnel;Our ability to identify and hire qualified personnel;Our ability to timely and effectively implement,transition to,and maintain the necessary information technology systems,infrastructure,processes,and controls to support our operations and initiatives;Changes in inter

238、est rates;Existing sources of liquidity become insufficient or access to these sources becomes unexpectedly restricted;andExposure to financial risk due to asset-backed securitization transactions.Risks related to regulation and legal proceedingsOur products and activities are strictly and comprehen

239、sively regulated;Changes in laws or regulations or in the interpretation or enforcement of laws or regulations;Changes in accounting standards,rules,and interpretations and the failure of related assumptions and estimates;andThe impact of changes in tax laws and guidance,including the timing and amo

240、unt of revenues that we may recognize.Risks related to the ownership of our common stockVolatility in the market price of shares of our common stock;The timing and amount of future cash dividend payments;andAnti-takeover provisions in our charter documents and applicable state law.Risks Related to O

241、ur Business and OperationsWe have grown significantly in recent years,and our delinquency,credit loss rates,and overall results of operations may beadversely affected if we do not manage our growth effectively.We have experienced substantial growth in recent years,increasing the size of our finance

242、receivable portfolio from$834.0million at the beginning of 2018 to$1.7 billion at the end of 2022,a compound annual growth rate of 15.3%.We intend to continueour growth strategy in the future.As we increase the number of branches we operate,we will be required to find new,or relocateexisting,employe

243、es to operate our branches and allocate resources to train and supervise those employees.The success of a branchdepends significantly on the manager overseeing its operations and on our ability to enforce our underwriting standards andimplement controls over branch operations.Recruiting suitable man

244、agers for new branches can be challenging,particularly inremote areas and in areas where we face significant competition.Furthermore,the annual turnover rate among our branchmanagers was approximately 17%in 2021 and 23%in 2022,and turnover rates of managers in our new branches may be similar orhighe

245、r.Increasing the number of branches that we operate may divide the attention of our senior management or strain our abilityto adapt our infrastructure and systems to accommodate our growth.If we are unable to promote,relocate,or recruit suitablemanagers,oversee their activities effectively,maintain

246、our underwriting and loan servicing standards,and otherwise appropriately?Regional Management Corp.|2022 Annual Report on Form 10-K|14and effectively staff our branches,our delinquency and credit loss rates may increase and our overall results of operations may beadversely impacted.We face significa

247、nt risks in implementing our growth strategy,some of which are outside of our control.We intend to continue our growth strategy,which is based on opening and acquiring branches in existing and new markets,introducing new products and channels,and increasing the finance receivable portfolios of our e

248、xisting branches.Our ability toexecute this growth strategy is subject to significant risks,some of which are beyond our control,including:the inherent uncertainty regarding general economic conditions,including the impact of recent elevated inflation;the prevailing laws and regulatory environment o

249、f each state in which we operate or seek to operate and federal laws andregulations,all of which are subject to change at any time;the degree of competition in new markets and its effect on our ability to attract new customers;our ability to identify attractive locations for new branches;our ability

250、 to recruit qualified personnel,particularly in remote areas and in areas where we face a great deal ofcompetition;andour ability to obtain adequate financing for our expansion plans.For example,certain states into which we may expand limit the number of lending licenses granted.For instance,Georgia

251、 andNew Mexico require a“convenience and advantage”assessment of a new lending license and location prior to the granting of thelicense.This assessment adds time and expense to opening new locations and creates risk that our state regulator will deny anapplication for a new lending license due to a

252、perceived oversaturation of existing licensed lenders in the area in which we seek toexpand and operate.There can be no assurance that if we apply for a license for a new branch,whether in one of the states wherewe currently operate or in a state into which we would like to expand,we will be granted

253、 a license to operate.We also cannot becertain that any such license,even if granted,would be obtained in a timely manner or without burdensome conditions orlimitations.In addition,we may not be able to obtain and maintain the regulatory approvals,government permits,or licenses thatmay be required t

254、o operate.We are exposed to credit risk in our lending activities.Our ability to collect on loans depends on the willingness and repayment ability of our borrowers.Any material adversechange in the effectiveness of our underwriting models,our implementation of such models(including through our loan

255、originationsoftware and processes),or the ability or willingness of a significant portion of our borrowers to meet their obligations to us,whether due to changes in general economic,political,or social conditions,the cost of consumer goods,interest rates,naturaldisasters,military conflict or acts of

256、 war or terrorism,a prolonged public health crisis,epidemic,or pandemic(such as COVID-19),orother causes over which we have no control,or to changes or events affecting our borrowers such as unemployment,major medicalexpenses,bankruptcy,divorce,or death,would have a material adverse impact on our ea

257、rnings and financial condition.Further,asubstantial majority of our borrowers are non-prime borrowers who are more likely to be affected,and more severely affected,byadverse macroeconomic conditions.We cannot be certain that our credit administration personnel,policies,and procedures willadequately

258、adapt to changes in economic or any other conditions affecting customers and the quality of the loan portfolio.Our convenience check strategy exposes us to certain risks.A significant portion of the growth in our installment loans portfolio has been achieved through direct mail campaigns.Oneaspect o

259、f our direct mail campaigns involves mailing“convenience checks”to pre-screened recipients,which recipients can sign andcash or deposit,thereby agreeing to the terms of the proposed loan,which are disclosed on the front and back of the check and inthe accompanying disclosures.We use convenience chec

260、ks to seed new branch openings and to attract new customers to existingbranches in our geographic footprint.In 2021 and 2022,loans initiated through convenience checks represented 22.8%and 27.2%,respectively,of the value of our originated installment loans.We expect that convenience checks will cont

261、inue to represent ameaningful portion of our installment loan originations in the future.There are several risks associated with the use or origination ofconvenience checks,including the following:it is more difficult to maintain sound underwriting standards with convenience check customers who hist

262、orically havepresented a higher risk of default than customers that originate loans in our branches,as we do not meet conveniencecheck customers prior to soliciting them and extending a loan to them,and we may not be able to verify certain elementsof their financial condition,including their current

263、 employment status,income,or life circumstances;Regional Management Corp.|2022 Annual Report on Form 10-K|15we rely on credit information from a third-party credit bureau that is more limited than a full credit report to pre-screenpotential convenience check recipients,which may not be as effective

264、as a full credit report or may be inaccurate oroutdated;we face limitations on the number of potential borrowers who meet our lending criteria within proximity to our branches;we may not be able to continue to access the demographic and credit file information that we use to generate our mailinglist

265、s due to expanded regulatory or privacy restrictions;convenience checks pose a risk of fraud;any failure by the bank that issues and processes our convenience checks to properly process the convenience checkscould limit the ability of a recipient to cash the check and enter into a loan with us;custo

266、mers may opt out of direct mail solicitations and solicitations based on their credit file or may otherwise prohibit usfrom soliciting them;postal rates and production costs may continue to rise;potential changes in federal or state laws may prohibit the practice of directly mailing convenience chec

267、ks to potentialborrowers;andthe bank that issues our convenience checks may exit the business,and we may be unable to find a replacement issuerbank.In the future,we could experience one or more of these issues associated with our direct mail strategy.Any increase in the useof convenience checks will

268、 further increase our exposure to,and the magnitude of,these risks.The loans that we generate are generally obligations of non-prime borrowers and will likely have higher default rates thanloans constituting primarily obligations of prime borrowers.The loans we generate are generally obligations of“

269、non-prime”borrowers who do not qualify for,or have difficulty qualifyingfor,credit from traditional sources of consumer credit as result of,among other things,moderate income,limited assets,otheradverse income characteristics,and/or a limited credit history or an impaired credit record,which may inc

270、lude a history of irregularemployment,previous bankruptcy filings,repossessions of property,charged-off loans,and/or garnishment of wages.The average interest rate charged to such“non-prime”borrowers generally is higher than that charged by commercial banksand other institutions providing traditiona

271、l sources of consumer credit.These traditional sources of consumer credit typically imposemore stringent credit requirements than the personal loan products that we provide.As a result of the general credit profile of ourborrowers and the interest rates on the loans we make,the historical delinquenc

272、y and default experience on our loans may behigher(and may be significantly higher)than those experienced by financial products arising from traditional sources of consumercredit.Additionally,delinquency and default experience on our loans is likely to be more sensitive to changes in the economiccli

273、mate in the areas in which our borrowers reside.Social and economic factors may affect repayment of the loans comprising our loan portfolio.The ability of our borrowers to make payments on their loans,as well as the prepayment experience thereon,will be affectedby a variety of social and economic fa

274、ctors.Economic factors include interest rates,unemployment levels,gasoline prices,theavailability and cost of credit(including mortgages),upward adjustments in monthly mortgage payments,real estate values,the rateof inflation,and consumer perceptions of economic conditions generally.Economic conditi

275、ons may also be impacted by localizedweather events and environmental disasters or adverse impacts from public health crises,epidemics,or pandemics(such as COVID-19).Social factors include changes in consumer confidence levels and attitudes toward incurring debt and changing attitudesregarding the s

276、tigma of personal bankruptcy.Our policies and procedures for underwriting,processing,and servicing loans are subject to potential failure orcircumvention,which may adversely affect our results of operations.Except for loans originated by a centralized branch and serviced at a centralized location pu

277、rsuant to a limited program weoperate in select markets,a substantial portion of our underwriting activities and our credit extension decisions are made at ourlocal branches.We rely on certain inputs and verifications in the underwriting process to be performed by individual personnel atthe branch l

278、evel or a centralized location.In addition,pursuant to our operations policies and procedures,exceptions to the generalunderwriting criteria can be approved by central underwriting employees and certain other senior employees.We train ouremployees individually onsite in the branch or at a centralize

279、d location and through online training modules to make loans that?Regional Management Corp.|2022 Annual Report on Form 10-K|16conform to our underwriting standards.Such training includes critical aspects of state and federal regulatory compliance,cashhandling,account management,and customer relation

280、s.Although we have standardized employee manuals and online trainingmodules,we primarily rely on our district supervisors,with oversight by our state vice presidents,branch auditors,and headquarterspersonnel,to train and supervise our branch employees,rather than centralized training programs.Theref

281、ore,the quality of trainingand supervision may vary from district to district and branch to branch depending on the amount of time apportioned to trainingand supervision and individual interpretations of our operations policies and procedures.There can also be no assurance that we willbe able to att

282、ract,train,and retain qualified personnel to perform the tasks that are part of the underwriting process.If the trainingor supervision of our personnel fails to be effective,or if we are unable to attract and retain qualified employees,it is possible thatour underwriting criteria would be improperly

283、 applied to a greater percentage of such applications.If such improper applicationswere to increase,delinquency and losses on our loan portfolio could increase and could increase significantly.In addition,we rely on certain third-party service providers in connection with loan underwriting and origi

284、nation.Any error orfailure by a third-party service provider in providing loan underwriting and origination services may cause us to originate loans toborrowers that do not meet our underwriting standards.We cannot be certain that every loan is made in accordance with ourunderwriting standards and r

285、ules.We have experienced instances of loans extended that varied from our underwriting standards.Variances in underwriting standards and lack of supervision could expose us to greater delinquencies and credit losses than we havehistorically experienced.Due to the general decentralized nature in whic

286、h the loan application process occurs,employee misconductor error in the application or closing process could also result in the origination of loans that do not satisfy our underwritingstandards,which could in turn have a material adverse effect on our results of operations and financial condition.

287、In addition,in deciding whether to extend credit or enter into other transactions with customers and counterparties,we relyheavily on information provided by customers,counterparties,and other third parties,including credit bureaus and dataaggregators,the inaccuracy or incompleteness of which may ad

288、versely affect our results of operations.We further rely onrepresentations of customers and counterparties as to the accuracy and completeness of that information.If a significantpercentage of our customers were to intentionally or negligently misrepresent any of this information,or provide incomple

289、teinformation,and our internal processes were to fail to detect such misrepresentations in a timely manner,or any or all of the othercomponents of the underwriting process described above were to fail,it could result in our approval of a loan that,based on ourunderwriting criteria,we would not have

290、otherwise made.As a result,our earnings and our financial condition could be negativelyimpacted.We may be limited in our ability to collect on our loan portfolio,and the security interests securing a significant portion ofour loan portfolio are not perfected,which may increase our credit losses.Lega

291、l and practical limitations may limit our ability to collect on our loan portfolio,resulting in increased credit losses,decreased revenues,and decreased earnings.State and federal laws and regulations restrict our collection efforts.The amounts thatwe are able to recover from the repossession and sa

292、le of collateral typically do not fully cover the outstanding loan balance andcosts of recovery.In cases where we repossess a vehicle securing a loan,we generally sell our repossessed automobile inventorythrough sales conducted by independent automobile auction organizations after the required post-

293、repossession waiting period.Incertain instances,we may sell repossessed collateral other than vehicles through our branches after the required post-repossessionwaiting period and appropriate receipt of valid bids.In either case,such sales are made consistent with applicable state law.Theproceeds we

294、receive from such sales depend upon various factors,including the supply of,and demand for,used vehicles and otherproperty at the time of sale.During periods of economic slowdown or recession,there may be less demand for used vehicles andother property that we desire to resell.Most of our loan portf

295、olio is secured,but a significant portion of such security interests have not been and will not beperfected,which means that we cannot be certain that such security interests will be given first priority over other creditors.Thelack of perfected security interests is one of several factors that may

296、make it more difficult for us to collect on our loan portfolio.Additionally,for those of our loans that are unsecured,borrowers may choose to repay obligations under other indebtedness beforerepaying loans to us because such borrowers may feel that they have no collateral at risk.In addition,given t

297、he relatively small sizeof our loans,the costs of collecting loans may be high relative to the amount of the loan.As a result,many collection practices thatare legally available,such as litigation,may be financially impracticable.Lastly,there is an inherent risk that a portion of the retailinstallme

298、nt contracts that we hold will be subject to certain claims or defenses that the borrower may assert against the originatorof the contract and,by extension,us as the holder of the contract.These factors may increase our credit losses,which would have amaterial adverse effect on our results of operat

299、ions and financial condition.Regional Management Corp.|2022 Annual Report on Form 10-K|17Our insurance operations are subject to a number of risks and uncertainties.We market and sell optional credit life,accident and health,personal property,involuntary unemployment,and vehicle singleinterest insur

300、ance to our borrowers in selected markets as an agent for an unaffiliated third-party insurance company.In addition,on certain loans,we collect a fee from our customers and use such fee to acquire non-file insurance from an unaffiliated insurancecompany for our benefit in lieu of recording and perfe

301、cting our security interest in certain personal property collateral.Theunaffiliated insurance company cedes to our wholly-owned insurance subsidiary,RMC Reinsurance,Ltd.,all of these insurancepolicies,the related net insurance premium revenue and the associated insurance claims liability for such in

302、surance products,including the non-file insurance that we purchase.When purchased by a borrower,the optional credit insurance products benefit the borrower by insuring the borrowerspayment obligations on the associated loan in the event of the borrowers inability to make monthly payments due to deat

303、h,disability,or involuntary unemployment,or in the event of a casualty event associated with collateral.The borrower financespayment of the associated premium with the financed premium included in the principal balance of the applicable loan.A creditinsurance product may be cancelled if,for example,

304、(i)we request cancellation due to the borrowers default on obligations underthe associated loan,(ii)the borrower prepays the principal balance of the associated loan in full,or(iii)the borrower elects toterminate the credit insurance prior to the expiration of the term thereof(which the borrower may

305、 do at any time).Generally,uponany cancellation of credit insurance,the borrower will be entitled to a refund of the unearned premium for the cancelled insurance.We typically refund insurance premiums by reducing the principal balance of the associated loan by the required refund amount,following wh

306、ich the unaffiliated insurance company reimburses us for the refunded amount.Our insurance operations are subject to a number of material risks and uncertainties,including changes in laws andregulations,borrower demand for insurance products,claims experience,and insurance carrier relationships;the

307、manner in whichwe are permitted to offer such products;capital and reserve requirements;the frequency and type of regulatory monitoring andreporting to which we are subject;benefits or loss ratio requirements;insurance producer licensing or appointment requirements;and reinsurance operations.In addi

308、tion,because our borrowers are not required to purchase the credit insurance products that weoffer,we cannot be certain that borrower demand for credit insurance products will not decrease in the future.In addition toadversely impacting our insurance income,net,any decrease in the demand for credit

309、insurance products would negatively impactour interest and fee income because we finance substantially all of our borrowers insurance premiums.Our insurance operationsare also dependent on our lending operations as the sole source of business and product distribution.If our lending operationsdiscont

310、inue offering insurance products,our insurance operations would have no method of distribution.Insurance claims andpolicyholder liabilities are also difficult to predict and may exceed the related reserves set aside for claims and associated expensesfor claims adjudication.We are also dependent on t

311、he continued willingness of unaffiliated third-party insurance companies to participate in thecredit insurance market and to offer non-file insurance to us.If our insurance provider is for any reason unable or unwilling to meetits claims and premium reimbursement payment obligations or its premium c

312、eding obligations,we would experience increased netcredit losses,regulatory scrutiny,litigation,and other losses and expenses.Finally,in recent years,as large loans have become a greater percentage of our portfolio,the severity of non-file insuranceclaims has increased and non-file insurance claims

313、expenses have exceeded non-file insurance premiums by a material amount.Theresulting net loss from the non-file insurance product is reflected in our insurance income,net.It is uncertain whether the non-fileinsurance product will be available to us in the future on the same terms as it is today,or a

314、t all.If the unaffiliated insurance companywere to enforce limitations on our non-file loss ratios or otherwise change the terms under which it offers non-file insurance to us,our net credit losses,loss rates,and provision for credit losses could increase.If any of these events,risks,or uncertaintie

315、s were to occur or materialize,it could have a material adverse effect on ourbusiness,financial condition,and results of operations and cash flows.A reduction in demand for our products and a failure by us to adapt to such reduction could adversely affect our businessand results of operations.The de

316、mand for the products we offer may be reduced due to a variety of factors,such as demographic patterns,changes incustomer preferences or financial conditions,regulatory restrictions that decrease customer access to particular products,or theavailability of competing products,including through altern

317、ative or competing marketing channels.For example,we are highlydependent upon selecting and maintaining attractive branch locations.These locations are subject to local market conditions,including the employment available in the area,housing costs,traffic patterns,crime,and other demographic influen

318、ces,any ofwhich may quickly change,thereby negatively impacting demand for our products in the area.Should we fail to adapt to significant?Regional Management Corp.|2022 Annual Report on Form 10-K|18changes in our customers demand for,or access to,our products,our revenues could decrease significant

319、ly and our operationscould be harmed.Even if we do make changes to existing products or introduce new products and channels to fulfill customerdemand,customers may resist or may reject such products.Moreover,the effect of any product change on the results of ourbusiness may not be fully ascertainabl

320、e until the change has been in effect for some time,and by that time it may be too late tomake further modifications to such product without causing further harm to our business,financial condition,and results ofoperations.We face strong direct and indirect competition.The consumer finance industry

321、is highly competitive,and the barriers to entry for new competitors are relatively low in themarkets in which we operate.We compete for customers,locations,employees,and other important aspects of our business withmany other local,regional,national,and international financial institutions,many of wh

322、ich have greater financial resources than wedo.Our installment loan operations compete with other installment lenders,as well as with alternative financial services providers(such as payday and title lenders,check advance companies,and pawnshops),online or peer-to-peer lenders,issuers of non-primecr

323、edit cards,and other competitors.We believe that future regulatory developments in the consumer finance industry may causelenders that focus on alternative financial services to begin to offer installment loans.In addition,if companies in the installmentloan business attempt to provide more attracti

324、ve loan terms than is standard across the industry,we may lose customers to thosecompetitors.With respect to installment loans,we compete primarily on the basis of price,breadth of loan product offerings,flexibility of loan terms offered,and the quality of customer service provided.We may attempt to

325、 pursue acquisitions or strategic alliances that may be unsuccessful.We may attempt to achieve our business objectives through acquisitions and strategic alliances.We compete with othercompanies for these opportunities,including companies with greater financial resources,and we cannot be certain tha

326、t we will beable to effect acquisitions or strategic alliances on commercially reasonable terms,or at all.Furthermore,most acquisition targetsthat we have pursued previously have been significantly smaller than us.We do not have extensive experience with integratinglarger acquisitions.In pursuing th

327、ese transactions,we may experience,among other things:overvaluing potential targets;difficulties in integrating any acquired companies,branches,or products into our existing business,including integrationof account data into our information systems;inability to realize the benefits we anticipate in

328、a timely fashion,or at all;attrition of key personnel from acquired businesses;unexpected losses due to the acquisition of loan portfolios with loans originated using less stringent underwriting criteria;significant costs,charges,or write-downs;orunforeseen operating difficulties that require signif

329、icant financial and managerial resources that would otherwise beavailable for the ongoing development and expansion of our existing operations.Geographic concentration of our loan portfolio may increase the risk of loss.Any concentration of our loan portfolio in a state or region may present unique

330、risk concentrations.Our branches in SouthCarolina,Texas,and North Carolina accounted for 11%,34%,and 15%,respectively,of our finance receivables as of December 31,2022.Further,as of December 31,2022,all of our operations were across 18 states.As a result,we are highly susceptible to adverseeconomic

331、conditions in these areas.The unemployment and bankruptcy rates in some states in our footprint are among the highestin the country.High unemployment rates may reduce the number of qualified borrowers to whom we will extend loans,whichwould result in reduced loan originations.In addition,some geogra

332、phic regions of the United States will,from time to time,experience weaker regional economic conditions and consequently will experience higher rates of loss and delinquency.A regionaleconomy may be affected by the loss of jobs in certain industries,by state and local taxes,or by other factors.A reg

333、ions economiccondition may be directly,or indirectly,adversely affected by international events such as military conflicts or wars,prolonged publichealth crises,epidemics,or pandemics(such as COVID-19),national events such as civil disturbances,or natural disasters such ashurricanes,wildfires,earthquakes,and other extreme conditions(including an increase in frequency of such conditions and eventsa