Key Takeaways PGY posted 10.5% y/y network volume growth in the first nine months of 2025.PGY's move into auto lending and point-of-sale financing has driven its network volume gains.PGY's diversified funding and better credit trends boosted fees and overall revenue growth.Pagaya Technologies Ltd. (PGY) has recorded robust growth in network volume (which is the main driver of its top line) so far in 2025. In the nine months ended Sept. 30, 2025, year-over-year network volume growth was 10.5%.With a resilien ...

Summary of Navient's Strategy Update Conference Call Company Overview - **Company**: Navient - **Division Highlighted**: Earnest, focusing on student loan refinancing and personal loans Key Points and Arguments Phase One and Phase Two Strategy - **Phase One**: Aimed at maximizing cash flows from legacy portfolios, resulting in an additional $2 billion of discretionary cash for growth or distributions [5][6] - **Phase Two**: Focused on growing earnings and changing market perception of Navient from a student lender to a specialty finance company [5][6][7] Earnest's Role and Business Model - **Earnest**: Represents Navient's student loan refinancing and personal loan business, with a strategy to generate long-term relationships with high lifetime value customers [9][10] - **Customer Profile**: Average customer age is in the early to mid-30s, with an income of approximately $120,000 and a FICO score above 770, indicating a high potential customer base [11] Financial Performance and Projections - **2025 Financial Snapshot**: Expected operating profit of around $70 million with $10 billion in outstanding loans, primarily securitized [12][14] - **Return on Equity (ROE)**: Aiming for a pre-tax ROE of about 12%, with potential for significant increases through optimized securitization strategies [42][45] Securitization Strategy - **Securitization Changes**: Transitioning from horizontal to vertical securitization to maximize return on equity, despite lower net interest income [20][22] - **Loan Sales**: Exploring loan sales as a method to remove loans from the balance sheet and accelerate income [22][23] Market Opportunities - **Total Addressable Market (TAM)**: - Education and graduate lending market estimated at $12 billion annually [32] - Student loan refinancing market projected to grow from $8 billion in 2025 to $11 billion in 2026 [32] - Personal lending market expected to be around $36 billion by 2028, targeting existing customers [33][34] Competitive Landscape - **Market Positioning**: Aiming to be competitive at lower origination levels compared to peers like Upstart and SoFi, with a focus on maintaining low sales and marketing expenses [26][27] - **Customer Acquisition**: Approximately $350 million spent to acquire the current customer base, with plans to monetize through multiple products as customer needs evolve [30] Technology and Operations - **New Lending Platform**: Launched a modular lending platform to improve operational efficiency and increase loan automation, enhancing conversion rates [17][18] - **Data Science Integration**: Expanding the use of machine learning for credit decisioning and pricing to improve competitiveness [18] Future Outlook - **Growth Projections**: Anticipating a significant increase in originations, with a goal of reaching around $4 billion in originations in the near term [40] - **Transition Year**: 2026 is seen as a pivotal year for transitioning into personal lending and expanding market presence [39] Additional Important Insights - **Talent Acquisition**: Efforts to attract industry talent to enhance operational capabilities and market competitiveness [12][13] - **Investor Relations**: Emphasis on improved disclosures to better communicate the value of Earnest as part of Navient [28][29] This summary encapsulates the strategic direction and financial outlook of Navient, particularly focusing on the Earnest division and its role in the company's growth strategy.

Southfield, Michigan, Nov. 13, 2025 (GLOBE NEWSWIRE) -- Credit Acceptance Corporation (Nasdaq: CACC) (the “Company”, “Credit Acceptance”, “we”, “our”, or “us”) announced today the completion of a $500.0 million asset-backed non-recourse secured financing (the “Financing”).  Pursuant to this transaction, we conveyed loans having a value of approximately $625.2 million to a wholly owned special purpose entity which will transfer the loans to a trust, which will issue three classes of notes: Note Class Amount  ...

Financial Data and Key Metrics Changes - Revenues for Q3 2025 were $108.4 million, an 8% increase from $100.6 million in Q3 2024 [7] - For the nine months ending September 2025, revenues reached $325.1 million, a 13% increase over $288 million in the same period last year [7] - Expenses for Q3 2025 were $101.4 million, also up 8% from $93.7 million in Q3 2024 [8] - Net income for Q3 2025 was $4.9 million, a 2% increase from $4.8 million in Q3 2024 [9] - Diluted earnings per share remained flat at $0.20 for Q3 2025, compared to the same period last year [9] Business Line Data and Key Metrics Changes - The fair value portfolio increased to $3.6 billion, yielding 11.4% net of losses [7] - Origination volumes for Q3 2025 were $391.1 million, with a total of $1.275 billion for the nine months, a 4% increase year-over-year [13] - The percentage of the portfolio from troubled 2022 and 2023 vintages is now below 30% [19] Market Data and Key Metrics Changes - The unemployment rate stood at 4.3% as of August 2025, with expectations to rise to 4.5% in 2026 [22] - The company noted increased competition from banks and credit unions, which may pressure growth [25] Company Strategy and Development Direction - The company is focusing on organic growth by adding new dealers and improving capture rates, which have increased from the high fours to over 6% [15] - A specific focus on large dealer groups has led to their originations comprising 31% of total originations, up from 17% two years ago [16] - The company aims to maintain APRs while improving margins and cutting expenses [27] Management's Comments on Operating Environment and Future Outlook - Management expressed a positive outlook for 2025, anticipating it to be the second-best year in the company's history despite modest growth [13][14] - The company is not overly concerned about a slight increase in unemployment, viewing it as a manageable risk [28] - Management highlighted that the performance of newer vintages (2024 and 2025) is showing improvement, indicating a positive trend in credit performance [19][20] Other Important Information - The company successfully completed a securitization despite market challenges, indicating stability in the market [6][25] - The total debt increased by 11% to $3.4 billion, while the fair value portfolio grew by 16%, showing improved balance sheet management [10][11] Q&A Session Summary - No specific questions or answers were provided in the transcript, as the call concluded without a Q&A segment [31]

Core Insights - Ellington Financial reported Q3 CY2025 revenue of $82.76 million, exceeding analyst expectations by 4.9% and reflecting a year-on-year growth of 23.6% [6] - The company's non-GAAP profit was $0.53 per share, which was 20.7% above consensus estimates [6] - Management highlighted strong performance driven by loan portfolio expansion and an active securitization pipeline [3] Financial Performance - Revenue: $82.76 million vs analyst estimates of $78.87 million, representing a 23.6% year-on-year growth [6] - Adjusted EPS: $0.53 vs analyst estimates of $0.44, a 20.7% beat [6] - Adjusted Operating Income: $25.74 million with a 31.1% margin, showing a 60.4% year-on-year growth [6] - Market Capitalization: $1.38 billion [6] Strategic Initiatives - The company priced seven securitizations during the quarter, focusing on non-QM and closed-end second lien loans, enhancing liquidity [7] - Total portfolio holdings grew by 12%, with significant increases in non-QM, proprietary reverse mortgage, and commercial mortgage bridge loans [7] - A successful $400 million issuance of five-year senior unsecured notes reduced reliance on short-term repo financing, improving capital efficiency [7] Credit Quality and Risk Management - Management reported exceptionally low cumulative realized credit losses in both residential and commercial loans, attributed to disciplined underwriting and a focus on higher FICO borrowers [7] - The company emphasized the importance of risk controls, including personal guarantees on certain loan types [7] Technology and Operational Efficiency - Investments in proprietary technology have enabled more efficient loan origination and delivery, broadening the range of mortgage products [8]

Financial Data and Key Metrics Changes - The company reported GAAP net income of $0.29 per share and adjusted distributable earnings (ADE) of $0.53 per share, marking a new quarterly high for ADE since its introduction in 2022, significantly exceeding the $0.39 per share dividends for the quarter [5][11][20] - Total portfolio holdings grew by 12% during the quarter, driven by non-QM, proprietary reverse mortgage, and commercial mortgage bridge loans [7][20] - The economic return for the third quarter was 9.2% annualized, with book value per share at $13.40 [20] Business Line Data and Key Metrics Changes - In the credit portfolio, net interest income grew sequentially, with $0.42 per share from credit, $0.04 from agency, and $0.09 from Longbridge [11][12] - The Longbridge segment had strong contributions from both originations and servicing, with origination profits driven by higher volumes of proprietary reverse mortgage loans [14][15] - The adjusted long credit portfolio increased by 11% to 3.56% quarter over quarter, while the Longbridge portfolio increased by 37% to $750 million [15][17] Market Data and Key Metrics Changes - The company noted a favorable environment for agency RMBS due to lower interest rates and reduced volatility, which supported portfolio performance [13] - The securitization market has become more liquid and commoditized, attracting a larger universe of investor-grade bond buyers, which has tightened spreads [70] Company Strategy and Development Direction - The company is focusing on diversifying its funding sources and reducing reliance on short-term repo financing, as evidenced by the successful pricing of $400 million in senior unsecured notes [10][21] - There is an emphasis on technology investments to enhance loan origination efficiency and expand the range of products offered by affiliate loan originators [23][25] - The company plans to expand its footprint in the securitization markets and is optimistic about purchasing seasoned mortgage loan portfolios from banks [25][27] Management's Comments on Operating Environment and Future Outlook - Management expressed concerns about potential economic cracks, including recent corporate bankruptcies and weakened job formation, but remains focused on maintaining credit quality [21][22] - The company anticipates continued strong performance in the fourth quarter, with robust securitization activity and origination volume [29][30] - Management highlighted the importance of maintaining a disciplined risk management approach while pursuing high returns [32] Other Important Information - The company has seen a significant increase in securitization volumes, with 20 securitizations priced year to date, more than triple last year's pace [6][9] - The percentage of borrowings subject to mark-to-market margining declined to 61% from 74% month over month, indicating improved financing terms [19] Q&A Session Summary Question: Discussion on loan originator platforms and valuations - Management noted that strong earnings performance has driven higher book values and liquidity for loan originator platforms, leading to improved valuations [35][36] Question: Opportunities in buying loans from banks - Management confirmed that recent transactions involved residential mortgage loans from smaller banks, indicating a trend of banks restructuring portfolios due to lower yields [40][41] Question: Credit performance and allocation of capital - Management highlighted that credit performance remains strong, particularly among higher-end borrowers, while being cautious about potential impacts from layoffs in the labor market [46][47] Question: Longbridge portfolio and leverage - Management stated that Longbridge does not require more leverage to achieve target returns, as most equity is in high-yielding servicing [75] Question: Non-QM market and convexity risk - Management emphasized the importance of understanding prepayment risks and noted that the Non-QM market has become more liquid and attractive due to tighter spreads [77][81]

Financial Data and Key Metrics Changes - GAAP net loss for Q3 2025 was $22 million or $0.27 per share, with GAAP book value at $20.24 per share [11] - Economic return on GAAP book value was negative 1.4% for Q3, while year-to-date return was 8.3% [11] - Economic net interest income for Q3 was $69 million, with a yield on average interest-earning assets of 5.9% and an average cost of funds of 4.5% [11] Business Line Data and Key Metrics Changes - Home Express originated $2.4 billion by UPB in Q3, up 36% year-over-year, with expectations of around $1 billion in Q4 originations [9][10] - For 2026, projected originations are between $4 billion and $4.4 billion, with pre-tax earnings of $62 million to $80 million [10] Market Data and Key Metrics Changes - The non-QM market share is expected to grow from 1.1% in 2021 to 5.1% or more than $100 billion in 2025, indicating a five-fold increase [5] - Primary mortgage rates declined approximately 35 basis points to 6.32%, leading to a rise in refinance activity [18] Company Strategy and Development Direction - The acquisition of Home Express for $267 million is aimed at enhancing earnings, diversifying revenue streams, and supporting long-term growth [9][10] - The company is focused on building a balanced and diversified portfolio, reducing reliance on residential credit [21] Management's Comments on Operating Environment and Future Outlook - The U.S. economy remains mixed but resilient, with growth supported by non-residential investment and gradual cooling in labor conditions [17] - The Federal Reserve has shifted to a more growth-oriented policy, cutting rates to support employment [17] Other Important Information - The company ended Q3 with $752 million in total cash and unencumbered assets, up from $561 million at the end of Q2 [12] - The acquisition of Home Express is expected to create synergies and enhance the company's asset management capabilities [25] Q&A Session Summary Question: Can you walk through the change in book value? - Management explained that the change was due to a lag in the timing of spreads changing in the securitization markets compared to the loan market, along with the steepening yield curve affecting securitized debt more significantly [29][30] Question: What is the update on book value for the quarter? - Management reported a 2.4% increase in book value through October 31 [31] Question: Is Goodwill $120 million from the acquisition? - Management confirmed that the total premium was above the $120 million book value, with ongoing evaluations for purchase accounting [32] Question: How will Home Express's earnings impact dividends? - Management indicated that the board will consider various factors regarding the retention of earnings for growth versus dividend payouts [36][37] Question: What are the near-term expectations for loan retention and securitization? - Management stated the intent to retain loans without disrupting existing partnerships, with expectations of one securitization per quarter [40][42]

Financial Data and Key Metrics Changes - The company achieved a record net effective spread of $97.8 million and core earnings of $49.6 million for Q3 2025 [6][25] - Year-to-date net effective spread and core earnings reached $281 million and $143 million, respectively, reflecting double-digit year-over-year growth [7][25] - The total allowance for losses was $37.2 million, or 12 basis points of total outstanding business volume [11] Business Line Data and Key Metrics Changes - The infrastructure finance line of business grew by $600 million this quarter to $11 billion, driven by strong interest in data centers and renewable energy projects [17] - The renewable energy segment more than doubled year-over-year to $2.3 billion, with expectations for continued growth [18] - The broadband infrastructure segment also doubled year-over-year to $1.3 billion, reflecting increased demand for data centers [20] - The agricultural finance portfolio grew by $285 million in Q3, outpacing scheduled maturities [21] Market Data and Key Metrics Changes - The company reported a modest uptick in 90-day delinquencies, attributed to seasonal impacts rather than identifiable trends [11] - Despite market uncertainties, the company has not seen significant effects on its portfolio related to political developments or government actions [12] Company Strategy and Development Direction - The company is focused on diversifying its loan portfolio into newer lines of business, including renewable energy and broadband infrastructure, to leverage competitive advantages [7][14] - The securitization program is a strategic initiative aimed at optimizing the balance sheet and enhancing growth opportunities [15] - The company plans to continue evaluating capital management tools to optimize its overall capital position [14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the overall health of the portfolio, supported by strong asset quality metrics [4][24] - The company anticipates continued growth in its diversified business segments despite broader market uncertainties [24] - Management noted that the agricultural sector is experiencing financial pressures, but they believe farmers are adapting to market conditions [42][45] Other Important Information - The company successfully issued $100 million of Series H preferred stock, strengthening its capital position [13] - Management is in the process of searching for a new CFO, with expectations for an announcement in Q4 2025 [26] Q&A Session Summary Question: Outlook for spreads given Fed rate cuts - Management indicated that a cut in interest rates should have no impact on the net effective spread due to their asset-liability management strategy [30] Question: Impact of tariffs on crops - Management noted that while there are financial pressures in major crops, some prices have increased, and they do not see systemic risks affecting their portfolio [42][45] Question: Changes in loan structure and prepayment expectations - Management confirmed that they are seeing significant increases in loan applications and approvals, with a focus on new money loans [52][58] Question: Credit provision levels - Management characterized the provision as episodic and not indicative of systemic issues, with no significant increases expected in the near term [38][66] Question: Share repurchase activity - Management disclosed a repurchase of approximately 30,000 shares for about $5 million [68]

Financial Data and Key Metrics Changes - The company reported distributable earnings of $73 million or $0.35 per share for the third quarter [21] - The investment portfolio grew to $11.67 billion at September 30, with an all-in yield of 7.27% [31] - The average yield in core assets decreased to 6.95% from 7.95% in the previous quarter [33] Business Line Data and Key Metrics Changes - The agency business originated $2 billion in loans during the third quarter, marking the second highest production quarter in the company's history [16] - The single-family rental business originated approximately $150 million in the third quarter, totaling $1.2 billion for the year [17] - The construction lending business closed $145 million in deals during the third quarter, with a strong pipeline of $900 million in applications [19] Market Data and Key Metrics Changes - The company closed about $400 million in bridge lending in the third quarter, with a total of $850 million for the first nine months of the year [13] - The securitization market remains constructive, allowing the company to access liquidity effectively [4] - The company expects to originate between $8.5 and $9 billion in volume for the year, despite a challenging environment [19] Company Strategy and Development Direction - The company aims to resolve legacy assets aggressively, targeting a significant reduction in troubled assets by the second quarter of next year [9] - The strategy includes modifying loans, taking back assets as REOs, and bringing in new sponsors to stabilize income streams [11] - The company is optimistic about future origination volumes due to recent interest rate cuts [10] Management's Comments on Operating Environment and Future Outlook - Management believes the third and fourth quarters of the year will represent the bottom of the cycle, with expectations for improved market conditions [9] - The company is focused on creating efficiencies and generating strong returns on capital despite a competitive landscape [14] - Management expressed optimism about the interest rate environment improving, which could lead to increased origination volumes [20] Other Important Information - The company recorded a $48 million gain from the sale of a portion of the Lexford portfolio, contributing to a total of $55 million in income from legacy investments [6][8] - Delinquencies rose to $750 million as of September 30, reflecting the current cycle's stress [26] - The company expects fluctuations in quarterly earnings as it resolves legacy issues [22] Q&A Session Summary Question: Can you estimate the stability of performing loans in the portfolio? - Management indicated that the stability of performing loans varies by market and emphasized the importance of capital and management in stabilizing assets [37][38] Question: What is the expected run rate of interest income? - Management clarified that the $18 million accrued interest reversal was a one-time adjustment, with a projected ongoing reduction in interest income of about $16 million [48][50] Question: Can you provide details on the Homewood sale? - The company expects a $1 million realized loss on the Homewood sale, with a reserve reversal of $9 million due to selling above the written-down value [59][60] Question: What is the outlook for REO properties? - Management noted that while property income fell, they are actively working to improve occupancy and stabilize REO assets for future sales [64][66]

Financial Data and Key Metrics Changes - The company reported basic and diluted earnings per share of $0.68 and $0.67 for Q3 2025, with year-to-date earnings of $1.57 and $1.54, reflecting a growth rate of 47% and 22% respectively compared to the previous year [11][12] - Revenue growth was reported at 19% for the quarter, with a tangible book value increase from $6.92 to $11.22 per share [12][20] - The efficiency ratio improved from 61.8% to 56.3%, while return on average assets was 3.15%, significantly ahead of industry standards [14][17] Business Line Data and Key Metrics Changes - Core deposits increased, with business deposits rising by $52 million (17%) and consumer deposits by $95 million (12%) [12][20] - The alternative loan program (ALP) is expected to see its largest securitization to date, ranging from $325 million to $350 million, indicating strong growth potential [13][22] - The company has opened 22,000 depository accounts and has 10,000 borrowers in its database, showcasing its ability to operate without traditional banking methods [8][9] Market Data and Key Metrics Changes - The company is focusing on independent business owners, a market that represents 43% of U.S. GDP, with over 36 million business owners in the U.S. [10] - The company has stabilized its credit quality, with non-performing loans (NPLs) at 8.1%, which is high compared to community banks but has been written off or written down [17][19] - The company is avoiding volatile industries such as oil and gas, transportation, and agriculture, while maintaining a strong consumer side [40][41] Company Strategy and Development Direction - The company aims to leverage technology and efficiency to create a future-oriented business model for a technology-enabled bank [3][4] - There is a strategic focus on diversifying the loan portfolio by adding more commercial and industrial (C&I) and commercial real estate (CRE) loans [59] - The company plans to continue its growth trajectory while managing risks effectively, with a goal to enhance transparency and provide better insights into its operations [63][64] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate the current economic environment, despite challenges such as a government shutdown [42][44] - The company anticipates that the current credit cycle will stabilize, with expectations of lower provisions and a more favorable lending environment [18][41] - Management highlighted the importance of maintaining a strong capital position and the potential for increased leverage in the future [64] Other Important Information - The company has raised significant capital, including $80 million in Tier 1 capital and $30 million in common equity, to support its growth [13][35] - The company is also focusing on enhancing its payment processing, payroll, and insurance services, which are expected to contribute positively to its overall business model [33] Q&A Session Summary Question: Update on credit trends and market pressures - Management noted that the economy is experiencing a divide, with stress in small businesses due to rising rates, but the consumer side remains strong [40][41] Question: Guidance for Q4 amidst government shutdown - Management did not pull guidance but acknowledged the uncertainty due to the government shutdown, indicating that it could impact loan originations [42][44] Question: Impact of government shutdown on loan processing - Management confirmed that they are still able to process loans that were approved before the shutdown and have provisions to bridge borrowers through this period [43][44] Question: Tier 1 and total capital risk-based ratios - The company reported a Tier 1 capital ratio of about 12.5% and total risk-based capital just shy of 16% [45] Question: SBA lenders leaving the market - Management highlighted that some SBA lenders are exiting due to regulatory changes and increased competition, but the company remains well-positioned to capture market share [70]