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Santander Consumer USA Holdings Inc. Reports Fourth Quarter and Full Year 2019 Results

01/29/20
Net Income of $994 Million and More Than $31 Billion in Originations in 2019; Completed $1 Billion Portfolio Acquisition in the Fourth Quarter 2019
Announced Its Intent To Commence a Tender Offer To Purchase Up To $1 Billion of Shares

DALLAS, Jan. 29, 2020 /PRNewswire/ -- Santander Consumer USA Holdings Inc. (NYSE: SC) ("SC" or the "Company") today announced net income for the fourth quarter ended December 31, 2019 ("Q4 2019") of $146 million, or $0.43 per diluted common share. Net income for the full year 2019 ("2019") was $994 million, or $2.86 per diluted common share.

The Company has declared a cash dividend of $0.22 per share, to be paid on February 20, 2020, to shareholders of record as of the close of business on February 10, 2020.

Management Quotes

"We are pleased with our full year 2019 results and the milestones we have accomplished across the organization. We made important management appointments which were all internally sourced, demonstrating the depth of the leadership team, reached a mutually beneficial agreement and achieved our highest-ever annual penetration rate of thirty-four percent with Fiat Chrysler, and continued to optimize capital through increased dividends and a robust share repurchase plan, including the announced tender offer" said Mahesh Aditya, SC President and CEO.  

Fahmi Karam, SC Chief Financial Officer, added, "2019 marked another strong year for the Company, reaching nearly $1 billion in net income, more than $31 billion in originations with strong returns and the lowest full-year net charge-off ratio in the last four years. We were pleased to see key credit metrics improve across the portfolio, demonstrating our efforts to enhance our operations and pricing functions as well as the continued strength of the consumer. The acquisition from Gateway One Lending demonstrates the Company's ability to deploy capital toward accretive transactions and partner with other large, and well-regarded financial institutions to leverage our best-in-class servicing platform. We remain focused on generating assets with strong risk-adjusted returns and managing operating expenses, while also working toward a more efficient capital base."

2019 Corporate Milestones

  • $31.3 billion of originations across loans and leases, all-time high
  • $994 million of net income, all-time high1
  • 7.8% retail installment loan net charge-off ratio, four-year low
  • Fiat Chrysler - reached mutually beneficial agreement and achieved an average annual penetration rate of 34%
  • Completed acquisition of $1.0 billion auto loan portfolio from Gateway One Lending
  • Leading auto loan and lease ABS issuer with $11.9 billion in ABS and launched first-ever nonprime revolving ABS platform "SREV"
  • Continued to grow and diversify our funding sources, including originating $7 billion in auto loans through our partnership with Santander Bank
  • Returned more than $600 million of capital to our shareholders through increased dividends and open market share repurchases.
  • Several key leadership appointments: Mahesh Aditya (President & Chief Executive Officer), Fahmi Karam (Chief Financial Officer) and Shawn Allgood (Head of Chrysler Capital and Auto Relationships)

2019 Key Financial Highlights (variances compared to the full year 2018 ("2018")

  • Total auto originations of $31.3 billion, up 9%
  • Net finance and other interest income of $4.7 billion, up 4%
  • RIC net charge-off ratio of 7.8%, down 70 basis points
  • Return on average assets ("ROA") of 2.2%
  • Expense ratio of 2.1%

Fourth Quarter of 2019 Highlights (variances compared to the fourth quarter of 2018 ("Q4 2018"), unless otherwise noted)

  • Total auto originations of $7.5 billion, up 9%
    • Core retail auto loan originations of $2.4, up 9%
    • Chrysler Capital loan originations of $3.2, up 29%
    • Chrysler Capital lease originations of $1.8, down 15%
    • Chrysler average quarterly penetration rate of 32%, up from 29%
    • Santander Bank, N.A. program originations of $1.9 billion
  • Net finance and other interest income2 of $1.2 billion, up 1%
  • 30-59 delinquency ratio of 9.7%, down 130 basis points
  • 59-plus delinquency ratio3 of 5.1%, down 90 basis points
  • Retail Installment Contract ("RIC") gross charge-off ratio of 17.3%, down 290 basis points
  • Recovery rate of 52.2%, up 490 basis points
  • RIC net charge-off ratio4 of 8.3%, down 230 basis points
  • Troubled Debt Restructuring ("TDR") balance of $3.9 billion, down 28%
  • Return on average assets of 1.2%, up from 1.0%
  • $2.2 billion in asset-backed securities "ABS"
  • Expense ratio of 2.1%, up from 1.9%
  • Common equity tier 1 ("CET1") ratio of 14.8%, down from 15.7% as of December 31, 2018

1Excludes the impact of 2017 corporate tax reform
2Includes Finance receivables held for investment, Finance receivables held for sale and Leased vehicles.
3Delinquency Ratio is defined as the ratio of end of period delinquent principal, over 59 days, to end of period gross balance of the respective portfolio, excludes   finance leases.
4Net Charge-Off Ratio stated on a recorded investment basis, which is unpaid principal balance adjusted for unaccreted net discounts, subvention and origination costs.

Conference Call Information
SC will host a conference call and webcast to discuss its Q4 2019 results and other general matters at 9:00 a.m. Eastern Time on Wednesday, January 29, 2020. The conference call will be accessible by dialing 866-548-4713 (U.S. domestic), or 323-794-2093 (international), conference ID 9192771. Please join 10 minutes prior to the start of the call. The conference call will also be accessible via live audio webcast through the Investor Relations section of SC's corporate website at http://investors.santanderconsumerusa.com. Choose "Events" and select the information pertaining to the Q4 2019 SC Earnings Conference Call. Additionally, there will be slides accompanying the webcast. Please allow at least 15 minutes prior to the call to register, download and install any necessary software prior to the call.

For those unable to listen to the live broadcast, a replay of the call will be available on the Company's website or by dialing 844-512-2921 (U.S. domestic), or 412-317-6671 (international), conference ID 9192771, approximately two hours after the conference call. An audio webcast of the call and investor presentation will also be archived on the Investor Relations section of SC's corporate website at http://investors.santanderconsumerusa.com, under "Events".

Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any statements about our expectations, beliefs, plans, predictions, forecasts, objectives, assumptions, or future events or performance are not historical facts and may be forward-looking. These statements are often, but not always, made through the use of words or phrases such as anticipates, believes, can, could, may, predicts, potential, should, will, estimates, plans, projects, continuing, ongoing, expects, intends, and similar words or phrases. Although we believe that the expectations reflected in these forward-looking statements are reasonable, these statements are not guarantees of future performance and involve risks and uncertainties that are subject to change based on various important factors, some of which are beyond our control. For additional discussion of these risks, refer to the section entitled Risk Factors and elsewhere in our Annual Report on Form 10-K and our Quarterly Reports on Form 10-Q filed by us with the U.S. Securities and Exchange Commission (SEC). Among the factors that could cause the forward-looking statements in this press release and/or our financial performance to differ materially from that suggested by the forward-looking statements are (a) the inherent limitations in internal control over financial reporting; (b) our ability to remediate any material weaknesses in internal controls over financial reporting completely and in a timely manner; (c) continually changing federal, state, and local laws and regulations could materially adversely affect our business; (d) adverse economic conditions in the United States and worldwide may negatively impact our results; (e) our business could suffer if our access to funding is reduced; (f) significant risks we face implementing our growth strategy, some of which are outside our control; (g) unexpected costs and delays in connection with exiting our personal lending business; (h) our agreement with FCA US LLC may not result in currently anticipated levels of growth and is subject to certain conditions that could result in termination of the agreement; (i) our business could suffer if we are unsuccessful in developing and maintaining relationships with automobile dealerships; (j) our financial condition, liquidity, and results of operations depend on the credit performance of our loans; (k) loss of our key management or other personnel, or an inability to attract such management and personnel; (l) certain regulations, including but not limited to oversight by the Office of the Comptroller of the Currency, the Consumer Financial Protection Bureau, the European Central Bank, and the Federal Reserve, whose oversight and regulation may limit certain of our activities, including the timing and amount of dividends and other limitations on our business; and (m) future changes in our relationship with SHUSA and Banco Santander that could adversely affect our operations. If one or more of the factors affecting our forward-looking information and statements proves incorrect, our actual results, performance or achievements could differ materially from those expressed in, or implied by, forward-looking information and statements. Therefore, we caution the reader not to place undue reliance on any forward-looking information or statements. The effect of these factors is difficult to predict. Factors other than these also could adversely affect our results, and the reader should not consider these factors to be a complete set of all potential risks or uncertainties as new factors emerge from time to time. Any forward-looking statements only speak as of the date of this document, and we undertake no obligation to update any forward-looking information or statements, whether written or oral, to reflect any change, except as required by law. All forward-looking statements attributable to us are expressly qualified by these cautionary statements.

About Santander Consumer USA Holdings Inc.
Santander Consumer USA Holdings Inc. (NYSE: SC) ("SC") is a full-service consumer finance company focused on vehicle finance, third-party servicing and delivering superior service to our more than 2.9 million customers across the full credit spectrum. The company, which began originating retail installment contracts in 1997, had an average managed asset portfolio of approximately $59 billion (for the fourth quarter ended December 31, 2019), and is headquartered in Dallas. (www.santanderconsumerusa.com)

CONTACTS:

Investor Relations
Evan Black
800.493.8219
InvestorRelations@santanderconsumerusa.com

Media Relations
Annette Rogers
469.563.4157
Media@santanderconsumerusa.com

Santander Consumer USA Holdings Inc.

Financial Supplement

Fourth Quarter 2019



Table of Contents


Table 1: Consolidated Balance Sheets

7

Table 2: Consolidated Statements of Income

8

Table 3: Other Financial Information

9

Table 4: Credit Quality

11

Table 5: Originations

13

Table 6: Asset Sales

14

Table 7: Ending Portfolio

15

Table 8: Reconciliation of Non-GAAP Measures

16

 

Table 1: Consolidated Balance Sheets






December 31, 2019


December 31, 2018

Assets

(Unaudited, Dollars in thousands)

Cash and cash equivalents

$

81,848



$

148,436


Finance receivables held for sale, net

1,007,105



1,068,757


Finance receivables held for investment, net

27,767,019



25,117,454


Restricted cash and cash equivalents

2,079,239



2,102,048


Accrued interest receivable

288,615



303,686


Leased vehicles, net

16,461,982



13,978,855


Furniture and equipment, net

59,873



61,280


Goodwill

74,056



74,056


Intangible assets

42,772



35,195


Due from affiliates

30,841



9,654


Other assets

1,040,179



1,060,434


Total assets

$

48,933,529



$

43,959,855


Liabilities and Equity




Liabilities:




Total borrowings and other debt obligations

$

39,194,141



$

34,883,037


Accounts payable and accrued expenses

499,326



472,321


Deferred tax liabilities, net

1,468,222



1,155,883


Due to affiliates

88,681



63,219


Other liabilities

364,539



367,037


Total liabilities

$

41,614,909



$

36,941,497






Equity:




Common stock, $0.01 par value

3,392



3,523


Additional paid-in capital

1,173,262



1,515,572


Accumulated other comprehensive income, net

(26,693)



33,515


Retained earnings

6,168,659



5,465,748


Total stockholders' equity

$

7,318,620



$

7,018,358


Total liabilities and equity

$

48,933,529



$

43,959,855


 

Table 2: Consolidated Statements of Income






Three Months Ended December 31,


Twelve Months Ended December 31,


2019


2018


2019


2018


(Unaudited, Dollars in thousands, except per share amounts)

Interest on finance receivables and loans

$

1,262,266



$

1,235,889



$

5,049,966



$

4,842,564


Leased vehicle income

732,160



632,447



2,764,258



2,257,719


Other finance and interest income

10,624



9,082



42,234



33,235


Total finance and other interest income

2,005,050



1,877,418



7,856,458



7,133,518


Interest expense

332,171



311,196



1,331,804



1,111,760


Leased vehicle expense

517,467



427,662



1,862,121



1,535,756


Net finance and other interest income

1,155,412



1,138,560



4,662,533



4,486,002


Provision for credit losses

545,345



690,786



2,093,749



2,205,585


Net finance and other interest income after provision for credit losses

610,067



447,774



2,568,784



2,280,417


Profit sharing

14,293



14,255



52,731



33,137


Net finance and other interest income after provision for credit losses and profit sharing

595,774



433,519



2,516,053



2,247,280


Investment losses, net

(168,406)



(146,164)



(406,687)



(401,638)


Servicing fee income

21,079



26,711



91,334



106,840


Fees, commissions, and other

83,304



86,035



364,119



333,458


Total other income

(64,023)



(33,418)



48,766



38,660


Compensation expense

127,900



122,475



510,743



482,800


Repossession expense

58,565



66,846



262,061



264,777


Other operating costs

123,010



67,147



437,747



346,095


Total operating expenses

309,475



256,468



1,210,551



1,093,672


Income before income taxes

222,276



143,633



1,354,268



1,192,268


Income tax expense

76,214



39,295



359,898



276,342


Net income

$

146,062



$

104,338



$

994,370



$

915,926










Net income per common share (basic)

$

0.43



$

0.29



$

2.87



$

2.55


Net income per common share (diluted)

$

0.43



$

0.29



$

2.86



$

2.54


Weighted average common shares (basic)

340,020,380



356,783,962



346,992,162



359,861,764


Weighted average common shares (diluted)

340,448,254



357,396,989



347,507,507



360,672,417


 

Table 3: Other Financial Information






Three Months Ended December 31,


Twelve Months Ended December 31,

Ratios (Unaudited, Dollars in thousands)

2019


2018


2019


2018

Yield on retail installment contracts

15.7

%


16.1

%


16.0

%


16.2

%

Yield on purchased receivables portfolios

14.4

%


19.1

%


15.6

%


23.8

%

Yield on receivables from dealers

1.4

%


2.2

%


1.8

%


3.0

%

Yield on leased vehicles

4.9

%


5.5

%


5.5

%


5.5

%

Yield on personal loans, held for sale (1)

25.7

%


25.1

%


26.0

%


24.6

%

Yield on earning assets (2)

12.2

%


13.0

%


12.7

%


13.2

%

Cost of debt (3)

3.5

%


3.6

%


3.6

%


3.4

%

Net interest margin (4)

9.5

%


10.2

%


9.9

%


10.6

%

Expense ratio (5)

2.1

%


1.9

%


2.1

%


2.1

%

Return on average assets (6)

1.2

%


1.0

%


2.2

%


2.2

%

Return on average equity (7)

8.0

%


5.9

%


13.7

%


13.3

%

Net charge-off ratio on individually acquired retail installment contracts (8)

8.3

%


10.6

%


7.8

%


8.5

%

Net charge-off ratio on purchased receivables portfolios (8)

%


(2.0)

%


%


(4.1)

%

Net charge-off ratio on personal loans (8)



0.1

%


0.1

%


0.1

%

Net charge-off ratio (8)

8.2

%


10.6

%


7.8

%


8.5

%

Delinquency ratio on individually acquired retail installment contracts held for investment, end of period (9)

5.1

%


6.0

%


5.1

%


6.0

%

Delinquency ratio on loans held for investment, end of period (9)

5.1

%


6.0

%


5.1

%


6.0

%

Allowance ratio (10)

9.9

%


11.4

%


9.9

%


11.4

%

Common stock dividend payout ratio (11)

51.2

%


69.0

%


29.3

%


19.6

%

Common Equity Tier 1 capital ratio (12)

14.8

%


15.7

%


14.8

%


15.7

%

Charge-offs, net of recoveries, on individually acquired retail installment contracts

$

618,269



$

754,625



$

2,288,812



$

2,314,769


Charge-offs, net of recoveries, on purchased receivables portfolios



(159)





(1,483)


Charge-offs, net of recoveries, on personal loans, held for sale

(23)



268



1,857



1,616


Charge-offs, net of recoveries, on finance leases

407



703



769



1,642


Total charge-offs, net of recoveries

$

618,653



$

755,437



$

2,291,438



$

2,316,544


End of period delinquent principal over 59 days, retail installment contracts held for investment

1,578,452



1,712,243



1,578,452



1,712,243


End of period delinquent principal over 59 days, personal loans

175,152



177,369



175,152



177,369


End of period delinquent principal over 59 days, loans held for investment

1,580,048



1,713,775



1,580,048



1,713,775


End of period assets covered by allowance for credit losses

30,816,291



28,469,451



30,816,291



28,469,451


End of period gross retail installment contracts held for investment

30,776,038



28,432,760



30,776,038



28,432,760


End of period gross personal loans held for sale

1,481,037



1,529,433



1,481,037



1,529,433


End of period gross finance receivables and loans held for investment

30,788,706



28,480,583



30,788,706



28,480,583


End of period gross finance receivables, loans, and leases held for investment

48,379,072



43,719,240



48,379,072



43,719,240


Average gross retail installment contracts held for investment

29,959,060



28,395,046



29,248,201



27,227,705


Average gross personal loans held for investment



2,934



969



4,314


Average gross individually acquired retail installment contracts held for investment and held for sale

$

29,936,775



$

28,395,046



$

29,271,168



$

27,756,099


Average gross purchased receivables portfolios

22,285



31,543



25,673



36,075


Average gross receivables from dealers

12,754



14,822



13,110



15,229


Average gross personal loans held for sale

1,364,877



1,401,626



1,393,456



1,404,261


Average gross finance leases

26,607



19,422



23,123



20,736


Average gross finance receivables and loans

$

31,363,298



$

29,862,459



$

30,726,530



$

29,232,400


Average gross operating leases

17,395,639



14,857,635



16,440,242



13,048,396


Average gross finance receivables, loans, and leases

48,758,937



44,720,094



47,166,772



42,280,796


Average managed assets

58,909,208



53,804,349



56,600,892



51,328,934


Average total assets

47,875,073



43,458,471



46,244,782



41,541,102


Average debt

38,185,199



34,223,818



36,727,416



32,570,257


Average total equity

7,339,351



7,114,411



7,243,438



6,905,796




(1)

Includes Finance and other interest income; excludes fees

(2)

"Yield on earning assets" is defined as the ratio of annualized Total finance and other interest income, net of Leased vehicle expense, to Average gross finance receivables, loans and leases

(3)

"Cost of debt" is defined as the ratio of annualized Interest expense to Average debt

(4)

"Net interest margin" is defined as the ratio of annualized Net finance and other interest income to Average gross finance receivables, loans and leases

(5)

"Expense ratio" is defined as the ratio of annualized Operating expenses to Average managed assets

(6)

"Return on average assets" is defined as the ratio of annualized Net income to Average total assets

(7)

"Return on average equity" is defined as the ratio of annualized Net income to Average total equity

(8)

"Net charge-off ratio" is defined as the ratio of annualized Charge-offs, on a recorded investment basis, net of recoveries, to average unpaid principal balance of the respective held-for-investment portfolio.

(9)

"Delinquency ratio" is defined as the ratio of End of period Delinquent principal over 59 days to End of period gross balance of the respective portfolio, excludes finance leases

(10)

"Allowance ratio" is defined as the ratio of Allowance for credit losses, which excludes impairment on purchased receivables portfolios, to End of period assets covered by allowance for credit losses

(11)

"Common stock dividend payout ratio" is defined as the ratio of Dividends declared per share of common stock to Earnings per share attributable to the Company's shareholders.

(12)

"Common Equity Tier 1 Capital ratio" is a non-GAAP ratio defined as the ratio of Total common equity tier 1 capital to Total risk-weighted assets (for a reconciliation from GAAP to this non-GAAP measure, see "Reconciliation of Non-GAAP Measures" in Table 8 of this release)

Table 4: Credit Quality

The activity in the credit loss allowance for individually acquired retail installment contracts for the three and twelve months ended months ended December 31, 2019 and 2018 was as follows (Unaudited, Dollar amounts in thousands):


Three Months Ended December 31, 2019


Three Months Ended December 31, 2018

Allowance for Credit Loss

Non-TDR


TDR


Non-TDR


TDR


Balance — beginning of period

$

2,051,792



$

1,060,612



$

1,740,862



$

1,559,808


Provision for credit losses *

494,069



50,392



503,382



186,676


Charge-offs

(950,993)



(341,668)



(888,142)



(544,843)


Recoveries

529,010



145,382



463,258



215,102


Balance — end of period

$

2,123,878



$

914,718



$

1,819,360



$

1,416,743



* Includes impact for individually acquired retail installment contracts transferred back from held for sale

 


Twelve Months Ended December 31, 2019


Twelve Months Ended December 31, 2018

Allowance for Credit Loss

Non-TDR


TDR


Non-TDR


TDR


Balance — beginning of period

$

1,819,360



$

1,416,743



$

1,540,315



$

1,804,132


Provision for credit losses

$

1,774,000



$

317,305



1,433,977



772,448


Charge-offs

$

(3,636,924)



$

(1,559,318)



(2,850,361)



(2,029,325)


Recoveries

$

2,167,442



$

739,988



1,695,429



869,488


Balance — end of period

$

2,123,878



$

914,718



$

1,819,360



$

1,416,743


A summary of delinquencies of our individually acquired retail installment contracts as of December 31, 2019 and 2018 is as follows (Unaudited, Dollar amounts in thousands):

Delinquent Principal

December 31, 2019


December 31, 2018

Principal 30-59 days past due

$

2,972,495



9.7

%


$

3,118,869



11.0

%

Delinquent principal over 59 days

1,578,452



5.1

%


1,712,243



6.0

%

Total delinquent contracts

$

4,550,947



14.8

%


$

4,831,112



17.0

%

The retail installment contracts acquired individually held for investment that were placed on nonaccrual status, as of December 31, 2019 and 2018 (Unaudited, Dollar amounts in thousands):

Nonaccrual Principal

December 31, 2019


December 31, 2018

Non-TDR

$

1,099,462



3.6

%


$

834,921



2.9

%

TDR

516,119



1.7

%


733,218



2.6

%

Total nonaccrual principal

$

1,615,581



5.3

%


$

1,568,139



5.5

%

The table below presents the Company's allowance ratio for TDR and non-TDR individually acquired retail installment contracts as of December 31, 2019 and 2018 (Unaudited, Dollar amounts in thousands):

Allowance Ratios

December 31, 2019


December 31, 2018

TDR - Unpaid principal balance

$

3,859,040



$

5,378,603


TDR - Impairment

914,718



1,416,743


TDR - Allowance ratio

23.7

%


26.3

%





Non-TDR - Unpaid principal balance

$

26,895,551



$

23,054,157


Non-TDR - Allowance

2,123,878



1,819,360


Non-TDR Allowance ratio

7.9

%


7.9

%





Total - Unpaid principal balance

$

30,754,591



$

28,432,760


Total - Allowance

3,038,596



3,236,103


Total - Allowance ratio

9.9

%


11.4

%

Table 5: Originations

The Company's originations of individually acquired loans and leases, including revolving loans, average APR, and dealer discount (net of dealer participation) were as follows:


Three Months Ended


Twelve Months Ended


Three Months
Ended


December 31, 2019


December 31, 2018


December 31, 2019


December 31, 2018


September 30,
2019

Retained Originations

(Unaudited, Dollar amounts in thousands)

Retail installment contracts

$

3,779,615



$

3,616,810



$

15,835,618



$

15,379,778



$

4,080,028


Average APR

15.8

%


17.1

%


16.3

%


17.3

%


16.0

%

Average FICO® (a)

598



593



598



595



599


Discount

(0.8)

%


0.5

%


(0.5)

%


0.2

%


(0.7)

%











Personal loans (b)

513,347



544,134



1,467,452



1,482,670



$

322,335


Average APR

29.8

%


29.5

%


29.8

%


29.6

%


29.7

%











Leased vehicles

1,811,662



2,125,925



8,520,489



9,742,423



$

2,225,117












Finance lease

4,600



2,706



17,589



$

9,794



$

4,859


Total originations retained

$

6,109,224



$

6,289,575



$

25,841,148



$

26,614,665



$

6,632,339












Sold Originations (c)










Retail installment contracts

$



$



$



$

1,820,085



$


Average APR

%


%


%


7.3

%


%

Average FICO® (d)







727




Total originations sold

$



$



$



$

1,820,085



$












Total originations (excluding SBNA Originations Program)

$

6,109,224



$

6,289,575



$

25,841,148



$

28,434,750



$

6,632,339




(a)

Unpaid principal balance excluded from the weighted average FICO score is $404 million, $408 million, $1.8 billion, $1.9 billion, and $440 million as the borrowers on these loans did not have FICO scores at origination and $181 million, $100 million , $582 million, $76 million and $154 million of commercial loans, for the three months ended December 31, 2019 and 2018, the twelve months ended December 31, 2019 and 2018 and the three months ended September 30, 2019, respectively.

(b)

Included in the total origination volume is $133 million, $150 million, $270 million, $304 million, and $62 million for the three months ended December 31, 2019 and 2018, the twelve months ended December 31, 2019 and 2018 and the three months ended September 30, 2019, respectively, related to newly opened accounts.

(c)

There were no sales in 2019.

(d)

Only includes assets both originated and sold in the period. Total asset sales for the period are shown in Table 6. Unpaid principal balance excluded from the weighted average FICO score is zero, zero,  zero,  $143 million and zero as the borrowers on these loans did not have FICO scores at origination and zero, zero, zero, $76 and zero million of commercial loans, for the three months ended December 31, 2019 and 2018,the twelve months ended December 31, 2019  and 2018, and the three months ended September 30, 2019, respectively.

SBNA Originations Program
Beginning in 2018, the Company agreed to provide SBNA with origination support services in connection with the processing, underwriting and purchase of retail loans, primarily from Chrysler dealers. In addition, the Company agreed to perform the servicing for any loans originated on SBNA's behalf. The Company facilitated the purchase of $1.9 billion and $7.0 billion of retail installment contacts during the three and twelve months ended December 31, 2019, respectively.

Table 6: Asset Sales






Three Months Ended December 31,


Twelve Months Ended December 31,


2019


2018


2019


2018


(Unaudited, Dollar amounts in thousands)

Retail installment contracts

$



$



$



$

2,905,922


Average APR

%


%


%


7.2

%

Average FICO®







726


Total asset sales

$



$



$



$

2,905,922


There were no asset sales during 2019, since it has been replaced with SBNA originations program.

Table 7: Ending Portfolio

Ending outstanding balance, average APR and remaining unaccreted net discount of our held for investment portfolio as of December 31, 2019, and 2018, are as follows:


December 31, 2019


December 31, 2018


(Unaudited, Dollar amounts in thousands)

Retail installment contracts

$

30,776,038



$

28,463,236


Average APR

16.1

%


16.7

%

Discount

0.3

%


0.8

%





Personal loans (a)

$



$

2,637


Average APR

%


31.7

%





Receivables from dealers

$

12,668



$

14,710


Average APR

4.0

%


4.1

%





Leased vehicles

$

17,562,782



$

15,219,313






Finance leases

$

27,584



$

19,344




(a)

The remaining balance of personal loans, held for investment, was charged off during the quarter ended June 30, 2019.

 

Table 8: Reconciliation of Non-GAAP Measures






December 31, 2019


December 31, 2018


(Unaudited, Dollar amounts in thousands)

Total equity

7,318,620



7,018,358


Deduct: Goodwill, intangibles, and other assets, net of deferred tax liabilities

152,756



161,516


Deduct: Accumulated other comprehensive income (loss), net

(26,693)



33,515


Tier 1 common capital

7,192,557



6,823,327


Risk weighted assets (a)

48,761,825



43,547,594


Common Equity Tier 1 capital ratio (b)

14.8

%


15.7

%



(a)

Under the banking agencies' risk-based capital guidelines, assets and credit equivalent amounts of derivatives and off-balance sheet exposures are assigned to broad risk categories. The aggregate dollar amount in each risk category is multiplied by the associated risk weight of the category. The resulting weighted values are added together with the measure for market risk, resulting in the Company's total Risk weighted assets.

(b)

CET1 is calculated under Basel III regulations required as of January 1, 2015. The fully phased-in capital ratios are non-GAAP financial measures.

 

Cision View original content:http://www.prnewswire.com/news-releases/santander-consumer-usa-holdings-inc-reports-fourth-quarter-and-full-year-2019-results-300995078.html

SOURCE Santander Consumer USA Holdings Inc.

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