Key Highlights

  • Diluted EPS of USD 1.61 rose 13.4% and topped the USD 1.47 consensus estimate on record quarterly revenue.
  • Revenue reached a record USD 178.8 million, up 8.0% and above the USD 174.69 million consensus estimate.
  • Net credit loss rate of 10.9% improved 130 basis points sequentially but rose 70 basis points from a year earlier.
  • Net finance receivables grew 7.6% to USD 2.2 billion as the bank partnership extended to three additional states.

Regional Management Corp. (NYSE:RM) reported third-quarter 2026 diluted EPS of USD 1.61, up 13.4% from USD 1.42 and above a consensus estimate of USD 1.47. Net income rose 5.3% to USD 15.1 million. Total revenue reached a record USD 178.8 million, an 8.0% increase that topped a consensus estimate of USD 174.69 million, on portfolio growth and fee income from the company's bank partnership.

Net finance receivables stood at USD 2.2 billion, up USD 156.9 million from a year earlier, led by large loans, which made up 78.8% of the portfolio against 73.7%. Auto-secured receivables grew 25.2% to USD 345.0 million. Originations totaled USD 530.3 million, with large loan originations up 11.8% and small loan originations down 21.9% after underwriting was tightened in higher-risk segments.

Credit, Yield and Expense Detail

The net credit loss rate was 10.9%, down from the prior quarter on seasonal patterns but up from 10.2% a year earlier. The company said the year-over-year increase was concentrated in loans originated in 2025, with the digital affiliate channel the largest driver. Thirty-day-plus delinquencies reached 7.5% of receivables, up 50 basis points both sequentially and year over year, while the rate on auto-secured loans was 2.2%. The provision for credit losses was USD 66.2 million, and the allowance stood at USD 230.8 million, or 10.4% of receivables.

Total revenue yield was 32.9%, down 20 basis points from a year earlier, as lower interest and fee yield and lower insurance income were largely offset by roughly 120 basis points of bank partnership fee income. General and administrative expenses were USD 68.6 million, and the operating expense ratio improved to 12.6% from 12.8% despite about 40 basis points of upfront origination costs on bank partnership loans. Interest expense was USD 24.1 million at a 4.4% cost of funds.

Outlook, Partnership Rollout and Funding

CEO Lakhbir Lamba said the Column N.A. partnership has originated more than USD 160 million of loans since March 2026 and now covers North Carolina, Louisiana and Missouri in addition to Texas. Just over 40% of October originations have come through the program, and the company targets substantially all of its branches under it by the end of 2027. A new chief credit risk officer starts on November 2, and the proprietary origination scorecard completes its rollout in the fourth quarter.

The company kept its 2026 guidance of net income growth of 6% to 9%, diluted EPS growth of 10% to 13% and portfolio growth of 5% to 7%. For the fourth quarter, it now projects net income below the third quarter, a net credit loss rate near 11.5%, portfolio growth of about USD 60 million, a cost of funds near 4.7% and a tax rate near 20%. The board declared a USD 0.30 dividend payable December 16 to holders of record on November 18, and the company repurchased 265,645 shares at an average of USD 37.64 during the quarter.

Operating Gauges to Follow

Four readings anchor the next report. Credit is first: a net credit loss rate of 10.9% now against about 11.5% projected for the fourth quarter and a stated goal below 10% over time. The bank partnership is second, with about USD 5 million of projected fourth-quarter net income contribution against about USD 3 million in the third. Funding is third, with USD 1.7 billion of debt, USD 104.0 million of available liquidity and a cost of funds moving from 4.4% toward 4.7%. The full 2027 outlook is fourth, scheduled for the fourth-quarter report.