High Charge-Offs, Low Yields Drove TCF Out of Auto Market, Analyst Says

Although TCF Bank was reticent to admit there were credit performance problems in its auto portfolio, the combination of low yields and a high volume of charge-offs ultimately drove the lender out of the business, said David Chiaverini, equity research analyst of mid-cap banks for Wedbush Securities. “[TCF] mentioned that credit quality is coming in-line […]
  • William Hoffman
  • December 11, 2017
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TCF’s Auto Sector Exit Intensifies Profitability Concerns at Regional Banks

The announcement this week that TCF Bank will shutter its indirect auto finance unit, Gateway One Lending & Finance LLC, caps a year that has been volatile for mid-sized regional banks, according to Peter Winter, analyst at Wedbush Securities. “Most banks are surprised how long the credit cycle has lasted for the [mid-tier] bank group,” […]
  • William Hoffman
  • December 6, 2017
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6 Issues Lenders Are Tackling in Collections and Repossessions

Delinquencies and losses continue to climb across the industry, and while many lenders are pulling back their volume of originations, others turn to refining their collections and repossession practices to stymie increasing losses. The percentage of borrowers 30 days or more past due grew 4 basis points year over year in the third quarter to […]
  • William Hoffman
  • November 30, 2017
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Competition Gets Messy as New Powersports Lenders Crowd the Market

About five or six years ago, the lending opportunity in the powersports market was wide open. As the industry recovered from the financial crisis, there was more demand than there was supply for powersports financing. Now, times have changed. Several new lending companies have entered the space — from captives to independent finance companies to […]
  • Natalie Mattila
  • May 17, 2017
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HDFS Losses ‘Temper,’ Yet Continue to Rise in 1Q

Harley-Davidson Financial Services originated $709.8 million — up 3.8% year-over-year — in the first quarter, according to the company’s earnings call today. Annualized net losses — at 2.3% in 1Q — were up 33 basis points from the prior-year quarter, and to top the highest level the captive has seen since the fourth quarter of 2010, when losses were at 2.11%.
  • Natalie Mattila
  • April 18, 2017
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Captives Offer ‘Competitive Advantage,’ Analyst Says

Captive finance arms offer a “pretty big competitive advantage” for powersports OEMs, particularly in an environment where independent finance companies are “coming and going,” James Hardiman, managing director of equity research at Wedbush Securities Inc., told Powersports Finance. For example, Speed Leasing LLC began underwriting leases on April 1. Speed Leasing’s entrance into the market […]
  • Natalie Mattila
  • April 17, 2017
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Harley-Davidson Financial Boosts Loss Provisions in 4Q

Harley-Davidson Financial Services loan-loss provision shot up 119% year over year — to $39.8 million — in 2016, driven by higher retail credit losses. The decline came amid a 2.3% year-over-year decline in originations, to $3.1 billion. Losses — up 40 basis points to 1.8% in 4Q16 — continue to reach record highs unseen since the fourth quarter of […]
  • Natalie Mattila
  • February 17, 2017
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Harley-Davidson to Lean on HDFS More in 2017, Despite Rising Losses

It appears that Harley-Davidson Inc. will be relying more on its captive Harley-Davidson Financial Services this year — despite rising credit losses — as more discounts and financial incentives are anticipated from foreign manufacturers.
  • Natalie Mattila
  • February 13, 2017
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