Investment Rating - The report provides a general overview of the Singapore Real Estate Investment Trusts (SREITs) and Business Trusts, indicating a mixed performance with SREITs down 0.9% year-to-date and Developers up 2.8% [2]. Core Insights - SREITs are currently trading at a 6.18% estimated yield for 2025, which is 375 basis points higher than 10-year government bonds. The expected growth in Distribution Per Unit (DPU) for SREITs is projected at 0.3% per annum from 2024 to 2026, driven primarily by Healthcare (+9.3%) and Diversified sectors (+1.1%) [3]. - Investor sentiment remains positive regarding the data center thesis, particularly for Keppel DC REIT (KDC), with confidence in near-term rental growth. However, there are concerns about long-term visibility post-2027 for Singapore-based data centers [4]. - The report emphasizes a "barbell strategy" for investment, recommending a combination of KDC for growth and CapitaLand Integrated Commercial Trust (CICT) for defensive income to balance resilience and reflation [4]. Summary by Sections Market Overview - The combined market capitalization of the 40 listed REITs and Business Trusts in Singapore is approximately US$70.6 billion [2]. Performance Metrics - Year-to-date performance shows SREITs down 0.9% while Developers have increased by 2.8% [2]. - The report highlights specific price performances of various REITs, with Dasin Retail Trust showing a significant decline of 25% year-to-date, while BHG Retail REIT has increased by 17.8% [6]. Preferred Investments - Recommended SREITs for exposure include Keppel DC REIT, CapitaLand Integrated Commercial Trust, and CapitaLand Ascendas [5]. Price Performance Analysis - The report includes detailed price performance metrics for various REITs, indicating fluctuations over different time frames, with some REITs experiencing significant gains while others faced declines [8].

Financial Data and Key Metrics Changes - The company reported a net income of $7 million and diluted EPS of $0.70 for Q1 2025, consistent with guidance but lower than Q1 2024 due to a special loan sale in the prior year [4][21] - The portfolio experienced a modest seasonal liquidation of $2 million, significantly lower than the $27 million decline in Q1 2024 [5] - Ending net receivables increased by 8% year over year, marking the fastest growth rate since 2023 [5] - Total revenue reached $153 million in Q1 2025, up 6% from the prior year, or 7.4% when adjusted for loan sale revenue benefits [25][26] Business Line Data and Key Metrics Changes - The auto secured loan portfolio grew by $59 million or 37% year over year, now representing 12% of the total portfolio [8][23] - The small loan portfolio increased by 11% year over year, with 18% of the portfolio carrying an APR greater than 36%, up from 16% a year ago [23] - New branches opened in September 2024 generated $1.5 million in revenue against $1.1 million in G&A expenses, demonstrating strong performance [7][30] Market Data and Key Metrics Changes - The company opened 15 new branches, 10 of which are in new markets, including California, Arizona, and Louisiana, all performing well [5][6] - The delinquency rate for the auto secured portfolio was 1.7%, the lowest among all products [24] Company Strategy and Development Direction - The company is focused on maintaining a tight credit box while pursuing growth through branch expansion and geographic diversification [12][14] - The barbell strategy emphasizes growth in high-quality auto secured loans and higher margin small loans [8][23] - The company aims for a minimum of 10% portfolio growth in 2025 despite economic uncertainties [14][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating economic uncertainties due to a strong credit box and capital reserves [15][19] - The company is closely monitoring macroeconomic conditions, including inflation and consumer behavior, to adjust strategies as needed [11][45] - Management expects net credit losses to decrease in the latter part of the year, contributing to improved net income [75] Other Important Information - The company has consented to CFPB supervision until January 2026 and has cooperated fully with the examination process, receiving no adverse findings [19] - The allowance for credit losses was $199 million, with a reserve rate of 10.5% as of the end of Q1 2025 [13][28] Q&A Session Summary Question: Long-term outlook on NIM - Management indicated that as fixed-rate funding matures, the cost of funds will increase, but higher margin business will help balance this [40][42] Question: Signs of consumer behavior changes - Management noted that consumer behavior remains stable, with no significant pull forward in spending observed [44][45] Question: Clarification on capital generation - Management explained that Q1 typically sees lower net income, but expects increases as the year progresses due to lower net credit losses and higher revenue [60][61] Question: Credit tightening context - Management stated that they apply stress factors in underwriting, varying by portfolio segment, rather than a uniform approach [64] Question: Guidance on expenses - Management provided Q2 guidance for G&A expenses at approximately $65.5 million, with increases expected as loan volumes rise [86] Question: Consumer spending patterns - Management observed that consumer spending is steady, with no signs of accelerated spending due to economic conditions [89]

Financial Data and Key Metrics Changes - The company reported a net income of $7 million and diluted EPS of $0.70 for Q1 2025, consistent with guidance but lower than Q1 2024 due to a prior year loan sale benefit [5][21] - Ending net receivables increased by 8% year over year, marking the fastest growth rate since 2023 [6] - Total revenue reached $153 million in Q1 2025, up 6% from the prior year, or 7.4% when adjusted for loan sale revenue benefits [25][26] Business Line Data and Key Metrics Changes - The auto secured loan portfolio grew by $59 million or 37% year over year, now representing 12% of the total portfolio [8][23] - The small loan portfolio increased by 11% year over year, with 18% of the portfolio carrying an APR greater than 36%, up from 16% a year ago [23][24] - Total originations reached record levels for Q1, up 20% year over year, with branch, direct mail, and digital originations increasing by 17%, 18%, and 46% respectively [22] Market Data and Key Metrics Changes - The thirty plus day delinquency rate was 7.1% at the end of Q1, flat year over year but improved by 60 basis points sequentially [26] - Net credit losses were $58.4 million, better than guidance by $1.6 million, with an annualized net credit loss rate of 12.4%, which is 90 basis points better year over year [26][27] Company Strategy and Development Direction - The company is focused on maintaining a tight credit box while pursuing growth through branch expansion, having opened 15 new branches in September 2024 [6][14] - The barbell strategy emphasizes growth in high-quality auto secured and higher margin small loan portfolios, which are expected to support customer graduation strategies [8][24] - The company aims for a minimum of 10% portfolio growth in 2025 despite economic uncertainties [14][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating economic uncertainties due to a strong credit box and capital reserves [15][19] - The company is closely monitoring macroeconomic conditions, including wage growth and inflation, which are favorable for its customer base [15][45] - Management anticipates a gradual improvement in delinquency rates and net credit losses in the upcoming quarters [27][28] Other Important Information - The company has consented to CFPB supervision for a two-year period ending in January 2026, with no adverse findings reported from recent examinations [19] - The effective tax rate for Q1 was 23.5%, with an expected increase to approximately 24.5% for Q2 [32] Q&A Session Summary Question: Long-term outlook on NIM - Management indicated that as fixed-rate funding matures, the cost of funds will increase, but higher margin business will help balance this [40][42] Question: Signs of consumer behavior changes - Management noted that consumer behavior remains stable, with no significant pull forward in spending observed [44][45] Question: Clarification on capital generation - Management explained that Q1 typically sees lower net income, but expects capital generation to increase as the year progresses [60] Question: Credit tightening context - Management applies different stress factors based on portfolio segments, indicating a nuanced approach to underwriting [64] Question: Guidance on expenses - Management provided Q2 expense guidance of approximately $65.5 million, with a focus on prudent expense control [86]

Financial Data and Key Metrics Changes - The company reported a net income of $7 million and diluted EPS of $0.70 for Q1 2025, consistent with guidance but lower than Q1 2024 due to a prior year loan sale benefit [4][20] - Ending net receivables increased by 8% year over year, marking the fastest growth rate since 2023 [5] - Total revenue reached $153 million in Q1 2025, up 6% from the prior year, or 7.4% when adjusted for loan sale revenue benefits [24] Business Line Data and Key Metrics Changes - The auto secured loan portfolio grew by $59 million or 37% year over year, now representing 12% of the total portfolio [7] - The small loan portfolio increased by 11% year over year, with 18% of the portfolio carrying an APR greater than 36%, up from 16% a year ago [22] - New branches opened in September 2024 generated $1.5 million in revenue against $1.1 million in G&A expenses, demonstrating strong performance [6] Market Data and Key Metrics Changes - The company opened 15 new branches, 10 of which are in new markets, and these branches are performing well with an average portfolio balance of $2.2 million [5][6] - The thirty plus day delinquency rate was 7.1%, flat year over year, but improved by 20 basis points when adjusted for the impact of growth in higher margin portfolios [9][25] Company Strategy and Development Direction - The company aims for a minimum of 10% portfolio growth in 2025 despite economic uncertainties, supported by a conservative credit box and strong capital generation [12][33] - The barbell strategy focuses on growth in high-quality auto secured and higher margin small loan portfolios, which are expected to continue performing well [7][22] - The company is prepared to tighten credit further if necessary, having already entered a potential downturn with a tightened credit box [11][13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating economic uncertainties due to a strong credit performance and a conservative underwriting approach [12][13] - The company is closely monitoring macroeconomic conditions, including inflation and consumer behavior, to adjust strategies as needed [10][45] - Management highlighted the resilience of their customer base, supported by wage growth and job availability [13][45] Other Important Information - The company generated $9.9 million in total capital in Q1 2025, with total capital generation since 2020 amounting to $339 million [17] - The allowance for credit losses was $199 million, with a reserve rate of 10.5%, expected to decline to 10.3% in Q2 2025 [12][27] - The company declared a dividend of $0.30 per share for Q2 2025, with a share repurchase program in place [33] Q&A Session Summary Question: Long-term outlook on NIM - Management indicated that as fixed-rate funding matures, the cost of funds will increase, but higher margin business will balance this [39][40] Question: Changes in consumer behavior - Management noted that consumer credit results are tracking as expected, with no significant changes in demand or payment behavior observed [44][45] Question: Guidance on expenses - Management provided Q2 guidance of approximately $65.5 million in G&A expenses, with increases expected as loan volumes rise [28][85] Question: Clarification on capital generation - Management explained that Q1 capital generation was lower due to seasonal factors, with expectations for improvement as the year progresses [58][59] Question: Credit box tightening - Management confirmed that they apply stress factors in underwriting, adjusting based on portfolio risk, rather than a uniform tightening approach [62][63]