Spec Fin Weekly

Research evidence excerpt

Spec Fin Weekly

■ According to Caribou (Private), an auto loan provider: Customers saved an average of $162 per month, to $585 from $747.

Refi loan APR was 4.27% points lower compared to the loan refinanced.

This is a positive read-through to all the debt consolidators in our space, not just auto refinancers. This includes LendingClub,

OneMain, Open Lending, Regional Management, SoFi, and Upstart. We expect their personal loan volumes, which are

essentially used for refinancing, to accelerate.SPECIALTY

On the other hand, this is a negative trend for the primary loan providers, including the credit cards and auto lenders such as

Ally Financial, Atlanticus, American Express, Bread Financial, Capital One, and Synchrony. Their portfolios might come under

more pressure of being refinanced away, as consumers look to lower monthly payments.FINANCE FRBNY Survey Of Consumer Expectations report points to deteriorating sentiment; Does it matter? The Federal Reserve Bank

of New York released its latest survey, which across the board pointed to worsening sentiment, including higher inflation, lower

future credit availability, and weaker job prospects. Frequently sentiment surveys such as this and the University of Michigan's

Consumer Sentiment index are cited to portend the doom in the US consumer. Yet, the actual data in spending, lending, and

losses continues to perform well.INDUSTRY

Where we think surveys such as these do have an impact on our lenders, is that we think its more likely that credit reserve rates

will remain flat q/q in 2Q26 results, and wouldn't be surprised if they tick up slightly. This is especially true in the near-prime

space, and for those who are not showing significant credit improvement. OneMain Financial comes to mind.REPORT