UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☑    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT

OF 1934

For the quarterly period ended September 30, 2022

OR

☐    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE

ACT OF 1934

For the transition period from to

Commission file number

001-36129 (OneMain Holdings, Inc.)

001-06155 (OneMain Finance Corporation)

ONEMAIN HOLDINGS, INC.

ONEMAIN FINANCE CORPORATION

(Exact name of registrant as specified in its charter)

Delaware (OneMain Holdings, Inc.)

27-3379612

Indiana (OneMain Finance Corporation)

35-0416090

(State of incorporation)

(I.R.S. Employer Identification No.)

601 N.W. Second Street, Evansville, IN 47708

(Address of principal executive offices) (Zip code)

(812) 424-8031

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934:

OneMain Holdings, Inc.:

Title of each class

Trading Symbol

Name of each exchange on which registered

Common Stock, par value $0.01 per share

OMF

New York Stock Exchange

OneMain Finance Corporation: None

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

OneMain Holdings, Inc.                     Yes ☑ No ☐

OneMain Finance Corporation                     Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

OneMain Holdings, Inc.                     Yes ☑ No ☐

OneMain Finance Corporation                     Yes ☑ No ☐

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Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

OneMain Holdings, Inc.:

Large accelerated filer

☑

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

OneMain Finance Corporation:

Large accelerated filer

☐

Accelerated filer

☐

Non-accelerated filer

☑

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

OneMain Holdings, Inc.                  ☐

OneMain Finance Corporation                  ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

OneMain Holdings, Inc.                 Yes ☐ No ☑

OneMain Finance Corporation                 Yes ☐ No ☑

At October 19, 2022, there were 122,211,896 shares of OneMain Holdings, Inc’s common stock, $0.01 par value, outstanding.

At October 19, 2022, there were 10,160,021 shares of OneMain Finance Corporation’s common stock, $0.50 par value, outstanding.

2

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TABLE OF CONTENTS

GLOSSARY						4
PART I — FINANCIAL INFORMATION
Item 1.			Financial Statements of OneMain Holdings, Inc. and Subsidiaries (Unaudited):
			Condensed Consolidated Balance Sheets			6
			Condensed Consolidated Statements of Operations			7
			Condensed Consolidated Statements of Comprehensive Income			8
			Condensed Consolidated Statements of Shareholders’ Equity			9
			Condensed Consolidated Statements of Cash Flows			11
			Financial Statements of OneMain Finance Corporation and Subsidiaries (Unaudited):
			Condensed Consolidated Balance Sheets			12
			Condensed Consolidated Statements of Operations			13
			Condensed Consolidated Statements of Comprehensive Income			14
			Condensed Consolidated Statements of Shareholder’s Equity			15
			Condensed Consolidated Statements of Cash Flows			16
			Notes to the Condensed Consolidated Financial Statements			17
Item 2.			Management’s Discussion and Analysis of Financial Condition and Results of Operations			38
Item 3.			Quantitative and Qualitative Disclosures About Market Risk			58
Item 4.			Controls and Procedures			59
			Controls and Procedures of OneMain Holdings, Inc.			59
			Controls and Procedures of OneMain Finance Corporation			59
PART II — OTHER INFORMATION
Item 1.			Legal Proceedings			60
Item 1A.			Risk Factors			60
Item 2.			Unregistered Sales of Equity Securities and Use of Proceeds			60
Item 3.			Defaults Upon Senior Securities			60
Item 4.			Mine Safety Disclosures			60
Item 5.			Other Information			60
Item 6.			Exhibit Index			61
SIGNATURES
			OneMain Holdings, Inc. Signature			62
			OneMain Finance Corporation Signature			63

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Table of Contents

GLOSSARY

Terms and abbreviations used in this report are defined below.

Term or Abbreviation						Definition
30-89 Delinquency ratio						net finance receivables 30-89 days past due as a percentage of net finance receivables
ABS						asset-backed securities
Adjusted pretax income (loss)						a non-GAAP financial measure used by management as a key performance measure of our segment
AETR						annual effective tax rate
AHL						American Health and Life Insurance Company, an insurance subsidiary of OneMain Financial Holdings, LLC
Annual Report						the Annual Report on Form 10-K of OMH and OMFC for the fiscal year ended December 31, 2021, filed with the SEC on February 11, 2022
ASC						Accounting Standards Codification
ASU						Accounting Standards Update
Average daily debt balance						average of debt for each day in the period
Average net receivables						average of monthly average net finance receivables (net finance receivables at the beginning and end of each month divided by two) in the period
Base Indenture						indenture, dated as of December 3, 2014, by and between OMFC and Wilmington Trust, National Association, as trustee, and guaranteed by OMH
Board						the OMH Board of Directors
C&I						Consumer and Insurance
CDO						collateralized debt obligations
CFPB						Consumer Financial Protection Bureau
CMBS						commercial mortgage-backed securities
Corporate AMT						Corporate Alternative Minimum Tax, as implemented by the Inflation Reduction Act
COVID-19						the global outbreak of a novel strain of coronavirus, including variants thereof
Exchange Act						Securities Exchange Act of 1934, as amended
FASB						Financial Accounting Standards Board
FICO						a credit score created by Fair Isaac Corporation
GAAP						generally accepted accounting principles in the United States of America
GAP						guaranteed asset protection
Gross charge-off ratio						annualized gross charge-offs as a percentage of average net receivables
Gross finance receivables						the unpaid principal balance of our personal loans. For precompute personal loans, unpaid principal balance is the gross contractual payments less the unaccreted balance of unearned finance charges. Credit card gross finance receivables equal the principal balance and billed interest and fees
Indenture						the Base Indenture, together with all subsequent Supplemental Indentures
IRA						Inflation Reduction Act, signed into law on August 16, 2022
Junior Subordinated Debenture						$350 million aggregate principal amount of 60-year junior subordinated debt issued by OMFC under an indenture dated January 22, 2007, by and between OMFC and Deutsche Bank Trust Company, as trustee, and guaranteed by OMH
Managed receivables						consist of our C&I net finance receivables and finance receivables serviced for our whole loan sale partners
Net charge-off ratio						annualized net charge-offs as a percentage of average net receivables
Net interest income						interest income less interest expense
NORA						Notice and Opportunity to Respond and Advise
ODART						OneMain Direct Auto Receivables Trust
OMFC						OneMain Finance Corporation

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Table of Contents

Term or Abbreviation						Definition
OMFIT						OneMain Financial Issuance Trust
OMH						OneMain Holdings, Inc.
OneMain						OneMain Holdings, Inc. and OneMain Finance Corporation, collectively with their subsidiaries
Open accounts						consist of credit card accounts that are not charged-off or closed accounts with a zero balance as of period end
Other securities						primarily consist of equity securities and those securities for which the fair value option was elected. Other securities recognize unrealized gains and losses in investment revenues
Pretax capital generation						a non-GAAP financial measure used by management as a key performance measure of our segment, defined as C&I adjusted pretax income (loss) excluding the change in C&I allowance for finance receivable losses
Private Secured Term Funding						$350 million aggregate principal amount of debt collateralized by our personal loans issued on April 25, 2022
Purchase volume						consists of credit card purchase transactions in the period, including cash advances, net of returns
Recovery ratio						annualized recoveries on net charge-offs as a percentage of average net receivables
RMBS						residential mortgage-backed securities
SEC						U.S. Securities and Exchange Commission
Securities Act						Securities Act of 1933, as amended
Segment Accounting Basis						a basis used to report the operating results of our C&I segment and our Other components, which reflects our allocation methodologies for certain costs and excludes the impact of applying purchase accounting
SpringCastle Portfolio						loans the Company previously owned and now services on behalf of a third party
Supplemental Indentures						collectively, the following supplements to the Base Indenture: Fourth Supplemental Indenture, dated as of December 8, 2017; Fifth Supplemental Indenture, dated as of March 12, 2018; Sixth Supplemental Indenture, dated as of May 11, 2018; Seventh Supplemental Indenture, dated as of February 22, 2019; Eighth Supplemental Indenture, dated as of May 9, 2019; Ninth Supplemental Indenture, dated as of November 7, 2019; Eleventh Supplemental Indenture, dated as of December 17, 2020; Twelfth Supplemental Indenture, dated as of June 22, 2021; and Thirteenth Supplemental Indenture, dated as of August 11, 2021
Tax Act						Public Law 115-97 amending the Internal Revenue Code of 1986
TDR finance receivables						troubled debt restructured finance receivables. Debt restructuring in which a concession is granted to the borrower as a result of economic or legal reasons related to the borrower’s financial difficulties
Triton						Triton Insurance Company, an insurance subsidiary of OneMain Financial Holdings, LLC
Unearned finance charges						the amount of interest that is capitalized at time of origination on a precompute loan that will be earned over the remaining contractual life of the loan
Unencumbered loans						unencumbered gross finance receivables excluding credit cards
Unsecured corporate revolver						unsecured revolver with a maximum borrowing capacity of $1.25 billion, payable and due on October 25, 2026
Unsecured Notes						the notes, on a senior unsecured basis, issued by OMFC and guaranteed by OMH
VIEs						variable interest entities
Weighted average interest rate						annualized interest expense as a percentage of average debt
XBRL						eXtensible Business Reporting Language
Yield						annualized finance charges as a percentage of average net receivables

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Table of Contents

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.

ONEMAIN HOLDINGS, INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets (Unaudited)

(dollars in millions, except par value amount)						September 30, 2022						December 31, 2021
Assets
Cash and cash equivalents						$	536					$	541
Investment securities (includes available-for-sale securities with a fair value and an amortized cost basis of $1.7 billion and $1.9 billion in 2022, respectively, and $1.9 billion and $1.8 billion in 2021, respectively)						1,747						1,992
Net finance receivables (includes loans of consolidated VIEs of $10.1 billion in 2022 and $8.8 billion in 2021)						19,752						19,212
Unearned insurance premium and claim reserves						(747)						(761)
Allowance for finance receivable losses (includes allowance of consolidated VIEs of $1.1 billion in 2022 and $910 million in 2021)						(2,255)						(2,095)
Net finance receivables, less unearned insurance premium and claim reserves and allowance for finance receivable losses						16,750						16,356
Restricted cash and restricted cash equivalents (includes restricted cash and restricted cash equivalents of consolidated VIEs of $472 million in 2022 and $466 million in 2021)						483						476
Goodwill						1,437						1,437
Other intangible assets						272						274
Other assets						1,116						1,003
Total assets						$	22,341					$	22,079
Liabilities and Shareholders’ Equity
Long-term debt (includes debt of consolidated VIEs of $9.2 billion in 2022 and $8.0 billion in 2021)						$	18,202					$	17,750
Insurance claims and policyholder liabilities						600						621
Deferred and accrued taxes						5						1
Other liabilities (includes other liabilities of consolidated VIEs of $18 million in 2022 and $13 million in 2021)						522						614
Total liabilities						19,329						18,986
Contingencies (Note 12)
Shareholders’ equity:
Common stock, par value $0.01 per share; 2,000,000,000 shares authorized, 122,618,748 and 127,809,640 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively						1						1
Additional paid-in capital						1,685						1,672
Accumulated other comprehensive income (loss)						(125)						61
Retained earnings						2,063						1,727
Treasury stock, at cost; 12,214,566 and 6,712,923 shares at September 30, 2022 and December 31, 2021, respectively						(612)						(368)
Total shareholders’ equity						3,012						3,093
Total liabilities and shareholders’ equity						$	22,341					$	22,079

See Notes to the Condensed Consolidated Financial Statements (Unaudited).

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ONEMAIN HOLDINGS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Operations (Unaudited)

						Three Months Ended September 30,												Nine Months Ended September 30,
(dollars in millions, except per share amounts)						2022						2021						2022						2021
Interest income						$	1,118					$	1,113					$	3,313					$	3,244
Interest expense						223						237						661						703
Net interest income						895						876						2,652						2,541
Provision for finance receivable losses						421						226						998						356
Net interest income after provision for finance receivable losses						474						650						1,654						2,185
Other revenues:
Insurance						111						109						334						323
Investment						16						14						40						47
Gain on sales of finance receivables						17						15						50						30
Net gain (loss) on repurchases and repayments of debt						2						(1)						(26)						(49)
Other						24						18						62						45
Total other revenues						170						155						460						396
Other expenses:
Salaries and benefits						212						229						621						613
Other operating expenses						151						155						451						457
Insurance policy benefits and claims						31						45						116						125
Total other expenses						394						429						1,188						1,195
Income before income taxes						250						376						926						1,386
Income taxes						62						88						228						335
Net income						$	188					$	288					$	698					$	1,051
Share Data:
Weighted average number of shares outstanding:
Basic						123,352,522						132,487,234						124,989,263						133,709,146
Diluted						123,568,620						132,924,333						125,243,206						134,096,382
Earnings per share:
Basic						$	1.52					$	2.17					$	5.58					$	7.86
Diluted						$	1.52					$	2.17					$	5.57					$	7.84

See Notes to the Condensed Consolidated Financial Statements (Unaudited).

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ONEMAIN HOLDINGS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Comprehensive Income (Unaudited)

						Three Months Ended September 30,												Nine Months Ended September 30,
(dollars in millions)						2022						2021						2022						2021
Net income						$	188					$	288					$	698					$	1,051
Other comprehensive income (loss):
Net change in unrealized losses on non-credit impaired available-for-sale securities						(65)						(9)						(248)						(34)
Foreign currency translation adjustments						(10)						(2)						(13)						1
Other						4						1						24						12
Income tax effect:
Net change in unrealized gains on non-credit impaired available-for-sale securities						15						2						57						8
Foreign currency translation adjustments						2						—						3						—
Other						(1)						—						(6)						(3)
Other comprehensive loss, net of tax, before reclassification adjustments						(55)						(8)						(183)						(16)
Reclassification adjustments included in net income, net of tax:
Net realized losses on available-for-sale securities, net of tax						—						—						(3)						(1)
Reclassification adjustments included in net income, net of tax						—						—						(3)						(1)
Other comprehensive loss, net of tax						(55)						(8)						(186)						(17)
Comprehensive income						$	133					$	280					$	512					$	1,034

See Notes to the Condensed Consolidated Financial Statements (Unaudited).

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ONEMAIN HOLDINGS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Shareholders’ Equity (Unaudited)

						OneMain Holdings, Inc. Shareholders’ Equity
(dollars in millions)						Common Stock						Additional Paid-in Capital						Accumulated Other Comprehensive Income (Loss)						Retained Earnings						Treasury Stock						Total Shareholders’ Equity
Three Months Ended September 30, 2022
Balance, July 1, 2022						$	1					$	1,679					$	(70)					$	1,994					$	(571)					$	3,033
Common stock repurchased						—						—						—						—						(42)						(42)
Treasury stock issued						—						—						—						(1)						1						—
Share-based compensation expense, net of forfeitures						—						8						—						—						—						8
Withholding tax on share-based compensation						—						(2)						—						—						—						(2)
Other comprehensive loss						—						—						(55)						—						—						(55)
Cash dividends *						—						—						—						(118)						—						(118)
Net income						—						—						—						188						—						188
Balance, September 30, 2022						$	1					$	1,685					$	(125)					$	2,063					$	(612)					$	3,012
Three Months Ended September 30, 2021
Balance, July 1, 2021						$	1					$	1,661					$	85					$	1,825					$	(35)					$	3,537
Common stock repurchased						—						—						—						—						(141)						(141)
Share-based compensation expense, net of forfeitures						—						4						—						—						—						4
Other comprehensive loss						—						—						(8)						—						—						(8)
Cash dividends *						—						—						—						(559)						—						(559)
Net income						—						—						—						288						—						288
Balance, September 30, 2021						$	1					$	1,665					$	77					$	1,554					$	(176)					$	3,121
* Cash dividends declared were $0.95 per share and $4.20 per share during the three months ended September 30, 2022 and 2021, respectively.

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ONEMAIN HOLDINGS, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Shareholders’ Equity (Unaudited) (Continued)
						OneMain Holdings, Inc. Shareholders’ Equity
(dollars in millions)						Common Stock						Additional Paid-in Capital						Accumulated Other Comprehensive Income (Loss)						Retained Earnings						Treasury Stock						Total Shareholders’ Equity
Nine Months Ended September 30, 2022
Balance, January 1, 2022						$	1					$	1,672					$	61					$	1,727					$	(368)					$	3,093
Common stock repurchased						—						—						—						—						(247)						(247)
Treasury stock issued						—						—						—						(1)						3						2
Share-based compensation expense, net of forfeitures						—						27						—						—						—						27
Withholding tax on share-based compensation						—						(14)						—						—						—						(14)
Other comprehensive loss						—						—						(186)						—						—						(186)
Cash dividends *						—						—						—						(361)						—						(361)
Net income						—						—						—						698						—						698
Balance, September 30, 2022						$	1					$	1,685					$	(125)					$	2,063					$	(612)					$	3,012
Nine Months Ended September 30, 2021
Balance, January 1, 2021						$	1					$	1,655					$	94					$	1,691					$	—					$	3,441
Common stock repurchased						—						—						—						—						(176)						(176)
Share-based compensation expense, net of forfeitures						—						16						—						—						—						16
Withholding tax on share-based compensation						—						(6)						—						—						—						(6)
Other comprehensive loss						—						—						(17)						—						—						(17)
Cash dividends *						—						—						—						(1,188)						—						(1,188)
Net income						—						—						—						1,051						—						1,051
Balance, September 30, 2021						$	1					$	1,665					$	77					$	1,554					$	(176)					$	3,121
* Cash dividends declared were $2.85 per share and $8.85 per share during the nine months ended September 30, 2022 and 2021, respectively.

See Notes to the Condensed Consolidated Financial Statements (Unaudited).

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ONEMAIN HOLDINGS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows (Unaudited)

						Nine Months Ended September 30,
(dollars in millions)						2022						2021
Cash flows from operating activities
Net income						$	698					$	1,051
Reconciling adjustments:
Provision for finance receivable losses						998						356
Depreciation and amortization						188						197
Deferred income tax charge (benefit)						(44)						57
Net loss on repurchases and repayments of debt						26						49
Share-based compensation expense, net of forfeitures						27						16
Gain on sales of finance receivables						(50)						(30)
Other						4						(4)
Cash flows due to changes in other assets and other liabilities						(124)						(53)
Net cash provided by operating activities						1,723						1,639
Cash flows from investing activities
Net principal originations and purchases of finance receivables						(2,010)						(1,738)
Proceeds from sales of finance receivables						599						361
Available-for-sale securities purchased						(406)						(347)
Available-for-sale securities called, sold, and matured						370						294
Other securities purchased						(5)						(706)
Other securities called, sold, and matured						11						691
Other, net						(56)						(54)
Net cash used for investing activities						(1,497)						(1,499)
Cash flows from financing activities
Proceeds from issuance and borrowings of long-term debt, net of issuance costs						4,479						2,168
Repayments and repurchases of long-term debt						(4,080)						(2,384)
Cash dividends						(364)						(1,185)
Common stock repurchased						(247)						(176)
Treasury stock issued						2						—
Withholding tax on share-based compensation						(14)						(6)
Net cash used for financing activities						(224)						(1,583)
Net change in cash and cash equivalents and restricted cash and restricted cash equivalents						2						(1,443)
Cash and cash equivalents and restricted cash and restricted cash equivalents at beginning of period						1,017						2,723
Cash and cash equivalents and restricted cash and restricted cash equivalents at end of period						$	1,019					$	1,280
Supplemental cash flow information
Cash and cash equivalents						$	536					$	821
Restricted cash and restricted cash equivalents						483						459
Total cash and cash equivalents and restricted cash and restricted cash equivalents						$	1,019					$	1,280

Restricted cash and restricted cash equivalents primarily represent funds required to be used for future debt payments relating to our secured transactions.

See Notes to the Condensed Consolidated Financial Statements (Unaudited).

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ONEMAIN FINANCE CORPORATION AND SUBSIDIARIES

Condensed Consolidated Balance Sheets (Unaudited)

(dollars in millions, except par value amount)						September 30, 2022						December 31, 2021
Assets
Cash and cash equivalents						$	512					$	510
Investment securities (includes available-for-sale securities with a fair value and an amortized cost basis of $1.7 billion and $1.9 billion in 2022, respectively, and $1.9 billion and $1.8 billion in 2021, respectively)						1,747						1,992
Net finance receivables (includes loans of consolidated VIEs of $10.1 billion  in 2022 and $8.8 billion in 2021)						19,752						19,212
Unearned insurance premium and claim reserves						(747)						(761)
Allowance for finance receivable losses (includes allowance of consolidated VIEs of $1.1 billion in 2022 and $910 million in 2021)						(2,255)						(2,095)
Net finance receivables, less unearned insurance premium and claim reserves and allowance for finance receivable losses						16,750						16,356
Restricted cash and restricted cash equivalents (includes restricted cash and restricted cash     equivalents of consolidated VIEs of $472 million in 2022 and $466 million in 2021)						483						476
Goodwill						1,437						1,437
Other intangible assets						272						274
Other assets						1,113						1,001
Total assets						$	22,314					$	22,046
Liabilities and Shareholder’s Equity
Long-term debt (includes debt of consolidated VIEs of $9.2 billion in 2022 and $8.0 billion in 2021)						$	18,202					$	17,750
Insurance claims and policyholder liabilities						600						621
Deferred and accrued taxes						5						1
Other liabilities (includes other liabilities of consolidated VIEs of $18 million in 2022 and $13 million in 2021)						522						614
Total liabilities						19,329						18,986
Contingencies (Note 12)
Shareholder’s equity:
Common stock, par value $0.50 per share; 25,000,000 shares authorized, 10,160,021 shares issued     and outstanding at September 30, 2022 and December 31, 2021						5						5
Additional paid-in capital						1,929						1,916
Accumulated other comprehensive income (loss)						(125)						61
Retained earnings						1,176						1,078
Total shareholder’s equity						2,985						3,060
Total liabilities and shareholder’s equity						$	22,314					$	22,046

See Notes to the Condensed Consolidated Financial Statements (Unaudited).

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ONEMAIN FINANCE CORPORATION AND SUBSIDIARIES

Condensed Consolidated Statements of Operations (Unaudited)

						Three Months Ended September 30,												Nine Months Ended September 30,
(dollars in millions)						2022						2021						2022						2021
Interest income						$	1,118					$	1,113					$	3,313					$	3,244
Interest expense						223						237						661						703
Net interest income						895						876						2,652						2,541
Provision for finance receivable losses						421						226						998						356
Net interest income after provision for finance receivable losses						474						650						1,654						2,185
Other revenues:
Insurance						111						109						334						323
Investment						16						14						40						47
Gain on sales of finance receivables						17						15						50						30
Net gain (loss) on repurchases and repayments of debt						2						(1)						(26)						(49)
Other						24						18						62						45
Total other revenues						170						155						460						396
Other expenses:
Salaries and benefits						212						229						621						613
Other operating expenses						151						155						451						457
Insurance policy benefits and claims						31						45						116						125
Total other expenses						394						429						1,188						1,195
Income before income taxes						250						376						926						1,386
Income taxes						62						88						228						335
Net income						$	188					$	288					$	698					$	1,051

See Notes to the Condensed Consolidated Financial Statements (Unaudited).

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ONEMAIN FINANCE CORPORATION AND SUBSIDIARIES

Condensed Consolidated Statements of Comprehensive Income (Unaudited)

						Three Months Ended September 30,												Nine Months Ended September 30,
(dollars in millions)						2022						2021						2022						2021
Net income						$	188					$	288					$	698					$	1,051
Other comprehensive income (loss):
Net change in unrealized losses on non-credit impaired available-for-sale securities						(65)						(9)						(248)						(34)
Foreign currency translation adjustments						(10)						(2)						(13)						1
Other						4						1						24						12
Income tax effect:
Net change in unrealized gains on non-credit impaired available-for-sale securities						15						2						57						8
Foreign currency translation adjustments						2						—						3						—
Other						(1)						—						(6)						(3)
Other comprehensive loss, net of tax, before reclassification adjustments						(55)						(8)						(183)						(16)
Reclassification adjustments included in net income, net of tax:
Net realized losses on available-for-sale securities, net of tax						—						—						(3)						(1)
Reclassification adjustments included in net income, net of tax						—						—						(3)						(1)
Other comprehensive loss, net of tax						(55)						(8)						(186)						(17)
Comprehensive income						$	133					$	280					$	512					$	1,034

See Notes to the Condensed Consolidated Financial Statements (Unaudited).

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ONEMAIN FINANCE CORPORATION AND SUBSIDIARIES

Condensed Consolidated Statements of Shareholder’s Equity (Unaudited)

						OneMain Finance Corporation Shareholder's Equity
(dollars in millions)						Common Stock						Additional Paid-in Capital						Accumulated Other Comprehensive Income (Loss)						Retained Earnings												Total Shareholder’s Equity
Three Months Ended September 30, 2022
Balance, July 1, 2022						$	5					$	1,923					$	(70)					$	1,165											$	3,023
Share-based compensation expense, net of forfeitures						—						8						—						—												8
Withholding tax on share-based compensation						—						(2)						—						—												(2)
Other comprehensive loss						—						—						(55)						—												(55)
Cash dividends						—						—						—						(177)												(177)
Net income						—						—						—						188												188
Balance, September 30, 2022						$	5					$	1,929					$	(125)					$	1,176											$	2,985
Three Months Ended September 30, 2021
Balance, July 1, 2021						$	5					$	1,905					$	85					$	1,535											$	3,530
Share-based compensation expense, net of forfeitures						—						4						—						—												4
Other comprehensive loss						—						—						(8)						—												(8)
Cash dividends						—						—						—						(718)												(718)
Net income						—						—						—						288												288
Balance, September 30, 2021						$	5					$	1,909					$	77					$	1,105											$	3,096
Nine Months Ended September 30, 2022
Balance, January 1, 2022						$	5					$	1,916					$	61					$	1,078											$	3,060
Share-based compensation expense, net of forfeitures						—						27						—						—												27
Withholding tax on share-based compensation						—						(14)						—						—												(14)
Other comprehensive loss						—						—						(186)						—												(186)
Cash dividends						—						—						—						(600)												(600)
Net income						—						—						—						698												698
Balance, September 30, 2022						$	5					$	1,929					$	(125)					$	1,176											$	2,985
Nine Months Ended September 30, 2021
Balance, January 1, 2021						$	5					$	1,899					$	94					$	1,442											$	3,440
Share-based compensation expense, net of forfeitures						—						16						—						—												16
Withholding tax on shared-based compensation						—						(6)						—						—												(6)
Other comprehensive loss						—						—						(17)						—												(17)
Cash dividends						—						—						—						(1,388)												(1,388)
Net income						—						—						—						1,051												1,051
Balance, September 30, 2021						$	5					$	1,909					$	77					$	1,105											$	3,096

See Notes to the Condensed Consolidated Financial Statements (Unaudited).

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ONEMAIN FINANCE CORPORATION AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows (Unaudited)

						Nine Months Ended September 30,
(dollars in millions)						2022						2021
Cash flows from operating activities
Net income						$	698					$	1,051
Reconciling adjustments:
Provision for finance receivable losses						998						356
Depreciation and amortization						188						197
Deferred income tax charge (benefit)						(44)						57
Net loss on repurchases and repayments of debt						26						49
Share-based compensation expense, net of forfeitures						27						16
Gain on sales of finance receivables						(50)						(30)
Other						4						(4)
Cash flows due to changes in other assets and other liabilities						(124)						(50)
Net cash provided by operating activities						1,723						1,642
Cash flows from investing activities
Net principal originations and purchases of finance receivables						(2,010)						(1,738)
Proceeds from sales of finance receivables						599						361
Available-for-sale securities purchased						(406)						(347)
Available-for-sale securities called, sold, and matured						370						294
Other securities purchased						(5)						(706)
Other securities called, sold, and matured						11						691
Other, net						(56)						(53)
Net cash used for investing activities						(1,497)						(1,498)
Cash flows from financing activities
Proceeds from issuance and borrowings of long-term debt, net of issuance costs						4,479						2,168
Repayments and repurchases of long-term debt						(4,080)						(2,384)
Cash dividends						(602)						(1,388)
Withholding tax on share-based compensation						(14)						(6)
Net cash used for financing activities						(217)						(1,610)
Net change in cash and cash equivalents and restricted cash and restricted cash equivalents						9						(1,466)
Cash and cash equivalents and restricted cash and restricted cash equivalents at beginning of period						986						2,723
Cash and cash equivalents and restricted cash and restricted cash equivalents at end of period						$	995					$	1,257
Supplemental cash flow information
Cash and cash equivalents						$	512					$	798
Restricted cash and restricted cash equivalents						483						459
Total cash and cash equivalents and restricted cash and restricted cash equivalents						$	995					$	1,257

Restricted cash and restricted cash equivalents primarily represent funds required to be used for future debt payments relating to our secured transactions.

See Notes to the Condensed Consolidated Financial Statements (Unaudited).

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ONEMAIN HOLDINGS, INC. AND SUBSIDIARIES

Notes to the Condensed Consolidated Financial Statements

September 30, 2022

1. Business and Basis of Presentation

OneMain Holdings, Inc. (“OMH”), and its wholly owned direct subsidiary, OneMain Finance Corporation (“OMFC”) are financial services holding companies whose subsidiaries engage in the consumer finance and insurance businesses.

The results of OMFC are consolidated into the results of OMH. Due to the nominal differences between OMFC and OMH, content throughout this filing relates to both OMH and OMFC, except where otherwise indicated. OMH and OMFC are referred to in this report, collectively with their subsidiaries, whether directly or indirectly owned, as “the Company,” “OneMain,” “we,” “us,” or “our.”

BASIS OF PRESENTATION

We prepared our condensed consolidated financial statements using generally accepted accounting principles in the United States of America (“GAAP”). These statements are unaudited. The year-end condensed balance sheet data was derived from our audited financial statements but does not include all disclosures required by GAAP. The statements include the accounts of OMH, its subsidiaries (all of which are wholly owned), and variable interest entities (“VIEs”) in which we hold a controlling financial interest and for which we are considered to be the primary beneficiary as of the financial statement date.

We eliminated all material intercompany accounts and transactions. We made judgments, estimates, and assumptions that affect amounts reported in our condensed consolidated financial statements and disclosures of contingent assets and liabilities. In management’s opinion, the condensed consolidated financial statements include the normal, recurring adjustments necessary for a fair statement of results. Actual results could differ from our estimates. We evaluated the effects of and the need to disclose events that occurred subsequent to the balance sheet date.

The condensed consolidated financial statements in this report should be read in conjunction with the consolidated financial statements and related notes included in our Annual Report. We follow the same significant accounting policies for our interim reporting. To conform to the 2022 presentation, we reclassified certain items in prior periods of our condensed consolidated financial statements.

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2. Recent Accounting Pronouncements

ACCOUNTING PRONOUNCEMENTS TO BE ADOPTED

Insurance

In August of 2018, the FASB issued ASU 2018-12, Financial Services - Insurance: Targeted Improvements to the Accounting for Long-Duration Contracts, which provides targeted improvements to Topic 944 for the assumptions used to measure the liability for future policy benefits for nonparticipating traditional and limited-payment contracts; measurement of market risk benefits; amortization of deferred acquisition costs; and enhanced disclosures. Upon adoption, our assumptions used to measure the liability for future policy benefits will be updated at least annually. The guidance requires the discount rate used to measure the liability to be an upper-medium grade fixed-income instrument yield and updated at each reporting date with changes in the liability due to the discount rate recognized in other comprehensive income. The amendments in this ASU become effective for the Company beginning January 1, 2023 and we have selected the modified retrospective transition method, which requires a transition date of January 1, 2021.

The Company’s cross-functional implementation team continues to make progress in line with the established project plan to ensure we comply with all the amendments in this ASU at the time of adoption. The Company’s long-duration contracts include whole life, term life, accidental death and dismemberment, and disability income protection. We are utilizing an actuarial software solution to meet the new accounting and disclosure requirements and continue to refine the development of the actuarial model and assumptions. After the model has been subject to a parallel testing phase in 2022, the Company will provide further disclosure regarding the estimated impact of the adoption of the ASU on our consolidated financial statements. At the transition date, we expect this ASU will result in an increase to insurance claims and policyholder liabilities that will primarily be driven by the remeasured discount rate, resulting in a reduction to accumulated other comprehensive income, net of tax. We expect this impact would reverse over the transition period as interest rates continue to rise. We expect the impact to retained earnings to be immaterial.

Financial Instruments

In March of 2022, the FASB issued ASU 2022-02, Financial Instruments - Credit Losses: Troubled Debt Restructurings and Vintage Disclosures, which eliminates the accounting for troubled debt restructurings by creditors while enhancing the disclosure requirements for certain loan refinancings and restructurings by creditors when a borrower is experiencing financial difficulty. The amendment also requires disclosure of gross charge-offs by year of origination for finance receivables. The amendments in this ASU are effective for the Company for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted. Management will adopt this ASU using the modified retrospective method effective January 1, 2023. We are currently evaluating whether adoption of this ASU will have a material impact on our consolidated financial statements.

We do not believe that any other accounting pronouncements issued, but not yet effective, would have a material impact on our consolidated financial statements or disclosures, if adopted.

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3. Finance Receivables

Our finance receivables consist of personal loans and credit cards. Personal loans are non-revolving, with a fixed rate, fixed terms generally between three and six years, and are secured by automobiles, other titled collateral, or are unsecured. During the third quarter of 2021, we began offering credit cards. Credit cards are open-ended, revolving, with a fixed rate, and are unsecured.

Components of our net finance receivables were as follows:

(dollars in millions)						Personal Loans						Credit Cards						Total
September 30, 2022
Gross finance receivables (a)						$	19,428					$	79					$	19,507
Unearned fees						(223)						—						(223)
Accrued finance charges and fees						280						—						280
Deferred origination costs						188						—						188
Total						$	19,673					$	79					$	19,752
December 31, 2021
Gross finance receivables (a)						$	18,944					$	24					$	18,968
Unearned fees						(225)						(1)						(226)
Accrued finance charges and fees						289						—						289
Deferred origination costs						179						2						181
Total						$	19,187					$	25					$	19,212

(a) Personal loan gross finance receivables equal the unpaid principal balance. For precompute personal loans, unpaid principal balance is the gross contractual payments less the unaccreted balance of unearned finance charges. Credit card gross finance receivables equal the principal balance and billed interest and fees.

WHOLE LOAN SALE TRANSACTIONS

As of September 30, 2022, we have whole loan sale flow agreements with third parties, with remaining terms of less than one year, in which we agreed to sell a combined total of $180 million gross receivables per quarter of newly originated unsecured personal loans along with any associated accrued interest. These unsecured personal loans are derecognized from our balance sheet at the time of sale. We service the personal loans sold and are entitled to a servicing fee and other fees commensurate with the services performed as part of the agreements. The gain on sales and servicing fees are recorded in other revenue. We sold $180 million and $540 million of gross finance receivables during the three and nine months ended September 30, 2022, respectively, and $160 million and $325 million of gross finance receivables during the three and nine months ended September 30, 2021, respectively. The gain on the sales were $17 million and $50 million during the three and nine months ended September 30, 2022, respectively, and $15 million and $30 million during the three and nine months ended September 30, 2021, respectively.

CREDIT QUALITY INDICATOR

We consider the delinquency status of our finance receivables as our key credit quality indicator. We monitor the delinquency of our finance receivable portfolio, including the migration between the delinquency buckets and changes in the delinquency trends to manage our exposure to credit risk in the portfolio.

When personal loans are 60 days contractually past due, we consider these accounts to be at an increased risk for loss and collection of these accounts is managed by our centralized operations. We consider our personal loans to be nonperforming at 90 days or more contractually past due, at which point we stop accruing finance charges and reverse finance charges previously accrued. For our personal loans, we reversed net accrued finance charges of $34 million and $88 million during the three and nine months ended September 30, 2022, respectively, and $18 million and $52 million during the three and nine months ended September 30, 2021, respectively.

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Finance charges recognized from the contractual interest portion of payments received on nonaccrual personal loans totaled $4 million and $12 million during the three and nine months ended September 30, 2022, respectively, and $2 million and $10 million during the three and nine months ended September 30, 2021, respectively. All personal loans in nonaccrual status are considered in our estimate of allowance for finance receivable losses.

We accrue finance charges and fees on credit cards until charge-off at approximately 180 days past due, at which point we reverse finance charges and fees previously accrued. For credit cards, net accrued finance charges and fees reversed for the three and nine months ended September 30, 2022 and 2021 were immaterial.

The following tables below are a summary of our personal loans by the year of origination and number of days delinquent:

(dollars in millions)						2022						2021						2020						2019						2018						Prior						Total
September 30, 2022
Performing
Current						$	8,627					$	6,034					$	2,151					$	1,365					$	336					$	133					$	18,646
30-59 days past due						88						143						47						32						10						6						326
60-89 days past due						54						108						34						21						6						4						227
Total performing						8,769						6,285						2,232						1,418						352						143						19,199
Nonperforming (Nonaccrual)
90+ days past due						63						258						84						48						14						7						474
Total						$	8,832					$	6,543					$	2,316					$	1,466					$	366					$	150					$	19,673

(dollars in millions)						2021						2020						2019						2018						2017						Prior						Total
December 31, 2021
Performing
Current						$	10,645					$	3,935					$	2,641					$	814					$	193					$	109					$	18,337
30-59 days past due						125						74						53						19						6						5						282
60-89 days past due						81						53						33						11						4						3						185
Total performing						10,851						4,062						2,727						844						203						117						18,804
Nonperforming (Nonaccrual)
90+ days past due						125						130						85						28						9						6						383
Total						$	10,976					$	4,192					$	2,812					$	872					$	212					$	123					$	19,187

The following is a summary of credit cards by number of days delinquent:

(dollars in millions)						September 30, 2022						December 31, 2021
Current						$	69					$	25
30-59 days past due						3						—
60-89 days past due						2						—
90+ days past due						5						—
Total						$	79					$	25

There were no credit cards that were converted to term loans at September 30, 2022 or December 31, 2021.

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TROUBLED DEBT RESTRUCTURED FINANCE RECEIVABLES

Information regarding TDR finance receivables were as follows:

(dollars in millions)						September 30, 2022						December 31, 2021
TDR gross finance receivables						$	797					$	646
TDR net finance receivables *						802						650
Allowance for TDR finance receivable losses						307						270

*    TDR net finance receivables are TDR gross finance receivables net of unearned fees, accrued finance charges, and deferred origination costs.

There were no credit cards classified as TDR finance receivables at September 30, 2022 or December 31, 2021.

Information regarding the new volume of the TDR finance receivables were as follows:

						Three Months Ended September 30,												Nine Months Ended September 30,
(dollars in millions)						2022						2021						2022						2021
Pre-modification TDR net finance receivables						$	245					$	105					$	521					$	332
Post-modification TDR net finance receivables:
Rate reduction						172						72						342						228
Other *						73						33						179						104
Total post-modification TDR net finance receivables						$	245					$	105					$	521					$	332
Number of TDR accounts						29,448						12,528						63,129						40,727

*    “Other” modifications primarily consist of loans with both rate reductions and the potential of principal forgiveness contingent on future payment performance by the borrower under the modified terms.

Finance receivables that were modified as TDR finance receivables within the previous 12 months and for which there was a default during the period to cause the TDR finance receivables to be considered nonperforming (90 days or more past due) are reflected in the following table:

						Three Months Ended September 30,												Nine Months Ended September 30,
(dollars in millions)						2022						2021						2022						2021
TDR net finance receivables *						$	34					$	31					$	94					$	88
Number of TDR accounts						4,348						4,221						11,906						12,147

* Represents the corresponding balance of TDR net finance receivables at the end of the month in which they defaulted.

UNFUNDED LENDING COMMITMENTS

Our unfunded lending commitments consist of the unused credit card lines, which are unconditionally cancellable. We do not anticipate that all of our customers will access their entire available line at any given point in time. The unused credit card lines totaled $64 million at September 30, 2022 and $54 million at December 31, 2021.

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4. Allowance for Finance Receivable Losses

We establish an allowance for finance receivable losses through the provision for finance receivable losses. We evaluate our finance receivable portfolio by the level of contractual delinquency in the portfolio, specifically in the late-stage delinquency buckets and inclusive of the migration of the finance receivables through the delinquency buckets. We estimate and record an allowance for finance receivable losses to cover the estimated lifetime expected credit losses on our finance receivables. Our allowance for finance receivable losses may fluctuate based upon changes in portfolio growth, credit quality, and economic conditions.

Our current methodology to estimate expected credit losses used the most recent macroeconomic forecasts, which incorporated the overall unemployment rate. Our unemployment outlook leveraged projections from various industry leading forecast providers. We also considered inflationary pressures, consumer confidence levels, and the risk of ongoing interest rate increases negatively impacting the economic outlook. At September 30, 2022, our economic forecast used a reasonable and supportable period of 12 months. The increase in our allowance for finance receivable losses for the three and nine months ended September 30, 2022 was primarily due to the weakened macroeconomic environment and growth in our loan portfolio. We may experience further changes to the macroeconomic assumptions within our forecast, as well as changes to our loan loss performance outlook, both of which could lead to further changes in our allowance for finance receivable losses, allowance ratio, and provision for finance receivable losses.

Changes in the allowance for finance receivable losses were as follows:

(dollars in millions)						Personal Loans						Credit Cards						Total
Three Months Ended September 30, 2022
Balance at beginning of period						$	2,115					$	12					$	2,127
Provision for finance receivable losses						415						6						421
Charge-offs						(349)						(3)						(352)
Recoveries						59						—						59
Balance at end of period						$	2,240					$	15					$	2,255
Three Months Ended September 30, 2021*
Balance at beginning of period						$	2,000					$	—					$	2,000
Provision for finance receivable losses						226						—						226
Charge-offs						(223)						—						(223)
Recoveries						58						—						58
Balance at end of period						$	2,061					$	—					$	2,061
Nine Months Ended September 30, 2022
Balance at beginning of period						$	2,090					$	5					$	2,095
Provision for finance receivable losses						985						13						998
Charge-offs						(1,029)						(3)						(1,032)
Recoveries						194						—						194
Balance at end of period						$	2,240					$	15					$	2,255
Nine Months Ended September 30, 2021*
Balance at beginning of period						$	2,269					$	—					$	2,269
Provision for finance receivable losses						356						—						356
Charge-offs						(730)						—						(730)
Recoveries						166						—						166
Balance at end of period						$	2,061					$	—					$	2,061

* The allowance for finance receivable losses for credit cards was immaterial for the three and nine months ended September 30, 2021 as the product offering began in the third quarter of 2021.

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The allowance for finance receivable losses and net finance receivables by impairment method were as follows:

(dollars in millions)															Personal Loans						Credit Cards						Total
September 30, 2022
Allowance for finance receivable losses:
Collectively evaluated for impairment															$	1,933					$	15					$	1,948
TDR finance receivables															307						—						307
Total															$	2,240					$	15					$	2,255
Finance receivables:
Collectively evaluated for impairment															$	18,871					$	79					$	18,950
TDR finance receivables															802						—						802
Total															$	19,673					$	79					$	19,752
Allowance for finance receivable losses as a percentage of finance receivables															11.39		%				19.14		%				11.42		%
December 31, 2021
Allowance for finance receivable losses:
Collectively evaluated for impairment															$	1,820					$	5					$	1,825
TDR finance receivables															270						—						270
Total															$	2,090					$	5					$	2,095
Finance receivables:
Collectively evaluated for impairment															$	18,537					$	25					$	18,562
TDR finance receivables															650						—						650
Total															$	19,187					$	25					$	19,212
Allowance for finance receivable losses as a percentage of finance receivables															10.89		%				19.91		%				10.90		%

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5. Investment Securities

AVAILABLE-FOR-SALE SECURITIES

Cost/amortized cost, allowance for credit losses, unrealized gains and losses, and fair value of fixed maturity available-for-sale securities by type were as follows:

(dollars in millions)						Cost/ Amortized Cost												Unrealized Gains						Unrealized Losses						Fair Value
September 30, 2022*
Fixed maturity available-for-sale securities:
U.S. government and government sponsored entities						$	12											$	—					$	(1)					$	11
Obligations of states, municipalities, and political subdivisions						72												—						(8)						64
Commercial paper						53												—						—						53
Non-U.S. government and government sponsored entities						144												—						(9)						135
Corporate debt						1,249												—						(135)						1,114
Mortgage-backed, asset-backed, and collateralized:
RMBS						208												—						(24)						184
CMBS						39												—						(3)						36
CDO/ABS						89												—						(9)						80
Total						$	1,866											$	—					$	(189)					$	1,677
December 31, 2021*
Fixed maturity available-for-sale securities:
U.S. government and government sponsored entities						$	16											$	—					$	—					$	16
Obligations of states, municipalities, and political subdivisions						76												3						—						79
Commercial paper						50												—						—						50
Non-U.S. government and government sponsored entities						151												4						—						155
Corporate debt						1,246												61						(5)						1,302
Mortgage-backed, asset-backed, and collateralized:
RMBS						169												3						(2)						170
CMBS						44												1						—						45
CDO/ABS						90												1						(1)						90
Total						$	1,842											$	73					$	(8)					$	1,907

*    The allowance for credit losses related to our investment securities as of September 30, 2022 and December 31, 2021 were immaterial.

Interest receivables reported in “Other assets” totaled $14 million as of September 30, 2022 and $13 million as of December 31, 2021, respectively. There were no material amounts reversed from investment revenue for available-for-sale securities for the three and nine months ended September 30, 2022 and 2021.

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Fair value and unrealized losses on available-for-sale securities by type and length of time in a continuous unrealized loss position without an allowance for credit losses were as follows:

						Less Than 12 Months												12 Months or Longer												Total
(dollars in millions)						Fair Value						Unrealized Losses						Fair Value						Unrealized Losses						Fair Value						Unrealized Losses
September 30, 2022
U.S. government and government sponsored entities						$	10					$	(1)					$	1					$	—					$	11					$	(1)
Obligations of states, municipalities, and political subdivisions						57						(7)						6						(1)						63						(8)
Commercial paper						53						—						—						—						53						—
Non-U.S. government and government sponsored entities						117						(6)						16						(3)						133						(9)
Corporate debt						953						(102)						135						(33)						1,088						(135)
Mortgage-backed, asset-backed, and collateralized:
RMBS						129						(13)						49						(11)						178						(24)
CMBS						29						(3)						7						—						36						(3)
CDO/ABS						57						(5)						24						(4)						81						(9)
Total						$	1,405					$	(137)					$	238					$	(52)					$	1,643					$	(189)
December 31, 2021
U.S. government and government sponsored entities						$	6					$	—					$	—					$	—					$	6					$	—
Obligations of states, municipalities, and political subdivisions						10						—						—						—						10						—
Commercial paper						46						—						—						—						46						—
Non-U.S. government and government sponsored entities						19						—						5						—						24						—
Corporate debt						208						(3)						38						(2)						246						(5)
Mortgage-backed, asset-backed, and collateralized:
RMBS						81						(1)						15						(1)						96						(2)
CMBS						7						—						—						—						7						—
CDO/ABS						41						(1)						3						—						44						(1)
Total						$	418					$	(5)					$	61					$	(3)					$	479					$	(8)

On a lot basis, we had 2,315 and 570 investment securities in an unrealized loss position at September 30, 2022 and December 31, 2021, respectively. We do not consider the unrealized losses to be credit-related, as these unrealized losses primarily relate to changes in interest rates and market spreads subsequent to purchase. Additionally, as of September 30, 2022, there were no credit impairments on investment securities that we intend to sell. We do not have plans to sell any of the remaining investment securities with unrealized losses as of September 30, 2022, and we believe it is more likely than not that we would not be required to sell such investment securities before recovery of their amortized cost.

We continue to monitor unrealized loss positions for potential credit impairments. During the three and nine months ended September 30, 2022 and 2021, there were no material credit impairments related to our investment securities. Therefore, there were no material additions or reductions in the allowance for credit losses (impairments recognized or reversed in earnings) on credit impaired available-for-sale securities for the three and nine months ended September 30, 2022 and 2021.

The proceeds of available-for-sale securities sold or redeemed during the three and nine months ended September 30, 2022 totaled $34 million and $235 million, respectively. The proceeds of available-for-sale securities sold or redeemed during the three and nine months ended September 30, 2021 totaled $50 million and $189 million, respectively. The net realized gains and losses were immaterial during the three and nine months ended September 30, 2022 and 2021.

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Contractual maturities of fixed-maturity available-for-sale securities at September 30, 2022 were as follows:

(dollars in millions)						Fair Value						Amortized Cost
Fixed maturities, excluding mortgage-backed, asset-backed, and collateralized securities:
Due in 1 year or less						$	186					$	187
Due after 1 year through 5 years						514						544
Due after 5 years through 10 years						526						616
Due after 10 years						151						183
Mortgage-backed, asset-backed, and collateralized securities						300						336
Total						$	1,677					$	1,866

Actual maturities may differ from contractual maturities since issuers and borrowers may have the right to call or prepay obligations. We may sell investment securities before maturity for general corporate and working capital purposes and to achieve certain investment strategies.

The fair value of securities on deposit with third parties totaled $534 million and $587 million at September 30, 2022 and December 31, 2021, respectively.

OTHER SECURITIES

The fair value of other securities by type was as follows:

(dollars in millions)						September 30, 2022						December 31, 2021
Fixed maturity other securities:
Bonds						$	25					$	30
Preferred stock *						16						22
Common stock *						29						33
Total						$	70					$	85

*    We employ an income equity strategy targeting investments in stocks with strong current dividend yields. Stocks included have a history of stable or increasing dividend payments.

Net unrealized losses on other securities held were immaterial for the three months ended September 30, 2022 and $12 million for the nine months ended September 30, 2022. Net unrealized gains and losses on other securities held were immaterial for the three and nine months ended September 30, 2021. Net realized gains and losses on other securities sold or redeemed were immaterial for the three and nine months ended September 30, 2022 and 2021.

Other securities primarily consist of equity securities and those securities for which the fair value option was elected. We report net unrealized and realized gains and losses on other securities held, sold, or redeemed in investment revenue.

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6. Long-term Debt

Principal maturities of long-term debt by type of debt at September 30, 2022 were as follows:

						Senior Debt
(dollars in millions)						Securitizations						Private Secured Term Funding						Revolving Conduit Facilities												Unsecured Notes (a) (e)						Junior Subordinated Debt (a)						Total
Interest rates (b)						0.87%-6.86%						3.30%						3.15%-3.41%												3.50%-8.25%						4.26		%
Remainder of 2022						$	—					$	—					$	—											$	—					$	—					$	—
2023						—						—						—												1,108						—						1,108
2024						—						—						—												1,270						—						1,270
2025						—						—						—												1,249						—						1,249
2026						—						—						—												1,600						—						1,600
2027-2067						—						—						—												3,682						350						4,032
Secured (c)						8,374						350						500												—						—						9,224
Total principal maturities						$	8,374					$	350					$	500											$	8,909					$	350					$	18,483
Total carrying amount						$	8,335					$	349					$	500											$	8,846					$	172					$	18,202
Debt issuance costs (d)						(37)						(1)						—												(66)						—						(104)

(a) Pursuant to the Base Indenture, the Supplemental Indentures, and the Guaranty Agreements, OMH agreed to fully and unconditionally guarantee, on a senior unsecured basis, payments of principal, premium and interest on the Unsecured Notes and Junior Subordinated Debenture. The OMH guarantees of OMFC’s long-term debt are subject to customary release provisions.

(b) The interest rates shown are the range of contractual rates in effect at September 30, 2022.

(c) Securitizations, private secured term funding, and borrowings under the revolving conduit facilities are not included in the above maturities by period due to their variable monthly repayments, which may result in pay-off prior to the stated maturity date. See Note 7 for further information on our long-term debt associated with securitizations, private secured term funding, and revolving conduit facilities.

(d) Debt issuance costs are reported as a direct deduction from long-term debt, with the exception of debt issuance costs associated with our revolving conduit facilities and unsecured corporate revolver, which totaled $29 million at September 30, 2022 and are reported in “Other assets.”

(e) During the nine months ended September 30, 2022, we repurchased, in the open market, portions of our Unsecured Notes in the amount of $165 million. In connection with these repurchases, we recognized a gain of $3 million in net gain (loss) on repurchases and repayments of debt.

Redemption of 8.875% Senior Notes Due 2025

On April 26, 2022, OMFC issued a notice to fully redeem its 8.875% Senior Notes due 2025. On June 1, 2022, OMFC paid a net aggregate amount of $637 million, inclusive of accrued interest and premiums, to complete the redemption. In connection with the redemption, we recognized $26 million of net loss on repurchases and repayments of debt during the second quarter of 2022.

Unsecured Corporate Revolver

On June 15, 2022, OMFC increased the total maximum borrowing capacity of its unsecured corporate revolver to $1.25 billion. The corporate revolver has a five-year term beginning October 25, 2021, during which draws and repayments may occur. Any outstanding principal balance is due and payable on October 25, 2026. At September 30, 2022, no amounts were drawn under this facility.

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7. Variable Interest Entities

CONSOLIDATED VIES

We have transferred finance receivables to VIEs for asset-backed financing transactions and include the assets and liabilities in our condensed consolidated financial statements because we are the primary beneficiary of each VIE. We account for these asset-backed debt obligations as securitized borrowings.

See Note 2 and Note 9 of the Notes to the Consolidated Financial Statements in Part II - Item 8 included in our Annual Report for more detail regarding VIEs.

We parenthetically disclose on our consolidated balance sheets the VIE’s assets that can only be used to settle the VIE’s obligations and liabilities when its creditors have no recourse against the primary beneficiary’s general credit. The carrying amounts of consolidated VIE assets and liabilities associated with our securitization trusts, private secured term funding, and revolving conduit facilities were as follows:

(dollars in millions)						September 30, 2022						December 31, 2021
Assets
Cash and cash equivalents						$	3					$	2
Net finance receivables						10,069						8,821
Allowance for finance receivable losses						1,073						910
Restricted cash and restricted cash equivalents						472						466
Other assets						26						26
Liabilities
Long-term debt						$	9,184					$	7,999
Other liabilities						18						13

Other than the retained subordinate and residual interests in our consolidated VIEs, we are under no further obligation than is otherwise noted herein, either contractually or implicitly, to provide financial support to these entities. Consolidated interest expense related to our VIEs totaled $81 million and $214 million during the three and nine months ended September 30, 2022, respectively, compared to $72 million and $225 million during the three and nine months ended September 30, 2021, respectively.

SECURITIZED BORROWINGS

Each of our outstanding securitizations contain a revolving period ranging from two to seven years during which no principal payments are required to be made on the related asset-backed notes. The indentures governing our securitized borrowings contain early amortization events and events of default, that, if triggered, may result in the acceleration of the obligation to pay principal and interest on the related asset-backed notes.

PRIVATE SECURED TERM FUNDING

At September 30, 2022, an aggregate amount of $350 million was outstanding under the private secured term funding collateralized by our personal loans. No principal payments are required to be made until after April 25, 2025, followed by a subsequent one-year amortization period, at the expiration of which the outstanding principal amount is due and payable.

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REVOLVING CONDUIT FACILITIES

We had access to 15 revolving conduit facilities with a total maximum borrowing capacity of $6.2 billion as of September 30, 2022. Our conduit facilities contain revolving periods during which time no principal payments are required, but may be made without penalty, followed by a subsequent amortization period. Principal balances of outstanding loans, if any, are due and payable in full over periods ranging up to eight years as of September 30, 2022. Amounts drawn on these facilities are collateralized by our personal loans.

At September 30, 2022, an aggregate amount of $500 million was drawn under these facilities and the remaining borrowing capacity was $5.7 billion.

8. Insurance

Changes in the reserve for unpaid claims and loss adjustment expenses (net of reinsurance recoverables):

						At or for the Nine Months Ended September 30,
(dollars in millions)						2022						2021
Balance at beginning of period						$	118					$	148
Less reinsurance recoverables						(3)						(3)
Net balance at beginning of period						115						145
Additions for losses and loss adjustment expenses incurred to:
Current year						142						158
Prior years *						(15)						(19)
Total						127						139
Reductions for losses and loss adjustment expenses paid related to:
Current year						(77)						(91)
Prior years						(61)						(79)
Total						(138)						(170)
Foreign currency translation adjustment						1						—
Net balance at end of period						105						114
Plus reinsurance recoverables						3						3
Balance at end of period						$	108					$	117

*    At September 30, 2022, $15 million reflected a redundancy in the prior years’ net reserves, primarily due to favorable development of credit life, credit disability, and term life claims during the period. At September 30, 2021, $19 million reflected a redundancy in the prior years’ net reserves, primarily due to favorable development of credit disability and unemployment claims during the period.

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9. Capital Stock and Earnings Per Share (OMH Only)

CAPITAL STOCK

OMH has two classes of authorized capital stock: preferred stock and common stock. OMFC has two classes of authorized capital stock: special stock and common stock. OMH and OMFC may issue preferred stock and special stock, respectively, in one or more series. The OMH Board of Directors and the OMFC Board of Directors determine the dividend, liquidation, redemption, conversion, voting, and other rights prior to issuance.

Changes in OMH shares of common stock issued and outstanding were as follows:

						Three Months Ended September 30,												Nine Months Ended September 30,
						2022						2021						2022						2021
Balance at beginning of period						123,726,559						133,884,043						127,809,640						134,341,724
Common stock issued						44,479						4,653						310,751						159,327
Common stock repurchased						(1,180,433)						(2,435,489)						(5,559,382)						(3,047,844)
Treasury stock issued						28,143						—						57,739						—
Balance at end of period						122,618,748						131,453,207						122,618,748						131,453,207

EARNINGS PER SHARE (OMH ONLY)

The computation of earnings per share was as follows:

						Three Months Ended September 30,												Nine Months Ended September 30,
(dollars in millions, except per share data)						2022						2021						2022						2021
Numerator (basic and diluted):
Net income						$	188					$	288					$	698					$	1,051
Denominator:
Weighted average number of shares outstanding (basic)						123,352,522						132,487,234						124,989,263						133,709,146
Effect of dilutive securities *						216,098						437,099						253,943						387,236
Weighted average number of shares outstanding (diluted)						123,568,620						132,924,333						125,243,206						134,096,382
Earnings per share:
Basic						$	1.52					$	2.17					$	5.58					$	7.86
Diluted						$	1.52					$	2.17					$	5.57					$	7.84

* We have excluded weighted-average unvested restricted stock units totaling 1,278,052 and 491,541 for the three months ended September 30, 2022 and 2021, respectively, and 1,230,739 and 322,430 for the nine months ended September 30, 2022 and 2021, respectively, from the fully-diluted earnings per share calculations as these shares would be anti-dilutive, which could impact the earnings per share calculation in the future.

Basic earnings per share is computed by dividing net income by the weighted-average number of shares outstanding during each period. Diluted earnings per share is computed based on the weighted-average number of shares outstanding plus the effect of potentially dilutive shares outstanding during the period using the treasury stock method. The potentially dilutive shares represent outstanding unvested restricted stock units.

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10. Accumulated Other Comprehensive Income (Loss)

Changes, net of tax, in accumulated other comprehensive income (loss) were as follows:

(dollars in millions)						Unrealized Gains (Losses) Available-for-Sale Securities (a)						Retirement Plan Liabilities Adjustments						Foreign Currency Translation Adjustments						Other (b)						Total Accumulated Other Comprehensive Income (Loss)
Three Months Ended September 30, 2022
Balance at beginning of period						$	(95)					$	1					$	1					$	23					$	(70)
Other comprehensive income (loss) before reclassifications						(50)						—						(8)						3						(55)
Balance at end of period						$	(145)					$	1					$	(7)					$	26					$	(125)
Three Months Ended September 30, 2021
Balance at beginning of period						$	71					$	1					$	5					$	8					$	85
Other comprehensive income (loss) before reclassifications						(7)						—						(2)						1						(8)
Balance at end of period						$	64					$	1					$	3					$	9					$	77
Nine Months Ended September 30, 2022
Balance at beginning of period						$	49					$	1					$	3					$	8					$	61
Other comprehensive income (loss) before reclassifications						(191)						—						(10)						18						(183)
Reclassification adjustments from accumulated other comprehensive income						(3)						—						—						—						(3)
Balance at end of period						$	(145)					$	1					$	(7)					$	26					$	(125)
Nine Months Ended September 30, 2021
Balance at beginning of period						$	91					$	1					$	2					$	—					$	94
Other comprehensive income (loss) before reclassifications						(26)						—						1						9						(16)
Reclassification adjustments from accumulated other comprehensive income						(1)						—						—						—						(1)
Balance at end of period						$	64					$	1					$	3					$	9					$	77

(a) There were no material amounts related to available-for-sale debt securities for which an allowance for credit losses was recorded during the three and nine months ended September 30, 2022 and 2021.

(b) Other primarily includes changes in the fair value of our mark-to-market derivative instruments that have been designated as cash flow hedges.

Reclassification adjustments from accumulated other comprehensive income (loss) to the applicable line item on our consolidated statements of operations were immaterial for the three and nine months ended September 30, 2022 and 2021.

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11. Income Taxes

We had a net deferred tax asset of $439 million and $339 million at September 30, 2022 and December 31, 2021, respectively. The increase in our net deferred tax asset of $100 million was primarily related to the change in fair value of investment securities and the increase in our allowance for finance receivable losses.

We follow the guidance of ASC 740, Income Taxes, for interim reporting of income taxes under which we calculate an estimated annual effective tax rate (“AETR”) and apply the AETR to our year-to-date income (loss) before income taxes. In addition, we recognize any discrete items as they occur.

The effective tax rate for the nine months ended September 30, 2022 was 24.6%, compared to 24.2% for the same period in 2021. The effective tax rate for the nine months ended September 30, 2022 and 2021 differed from the federal statutory rate of 21% primarily due to the effect of state income taxes.

We are under examination by various states for the years 2017 to 2020. Management believes it has adequately provided for taxes for such years.

Our gross unrecognized tax benefits, including related interest and penalties, totaled $5 million at September 30, 2022 and $8 million at December 31, 2021. We accrue interest related to uncertain tax positions in income tax expense. The amount of any change in the balance of uncertain tax liabilities over the next 12 months is not expected to be material to our consolidated financial statements.

On August 16, 2022, the Inflation Reduction Act of 2022 (“IRA”) was signed into law. The IRA includes a 15% Corporate Alternative Minimum Tax (“Corporate AMT”) for tax years beginning after December 31, 2022. We do not expect the Corporate AMT to have a material impact on our consolidated financial statements. Additionally, the IRA imposes a 1% excise tax on net repurchases of stock by certain publicly traded corporations. The excise tax is imposed on the value of the net stock repurchased or treated as repurchased. The new law will apply to stock repurchases occurring after December 31, 2022.

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12. Contingencies

LEGAL CONTINGENCIES

In the normal course of business, we have been named, from time to time, as defendants in various legal actions, including arbitrations, class actions, and other litigation arising in connection with our activities. Some of the actual or threatened legal actions include claims for substantial compensatory and/or punitive damages or claims for indeterminate amounts of damages. Additionally, we are, from time to time, in the normal course of business, subject to inquiries and investigations by federal, state and local governmental authorities regarding our products and our operations. These inquiries and investigations may result in fines, restitution or other penalties, including injunctive relief that may result in restrictions on our business. While we will continue to evaluate legal actions to determine whether a loss is reasonably possible or probable and is reasonably estimable, there can be no assurance that material losses will not be incurred from pending, threatened or future litigation, investigations, examinations, or other claims.

We contest liability and/or the amount of damages, as appropriate, in each pending matter. Where available information indicates that it is probable that a liability had been incurred at the date of the consolidated financial statements and we can reasonably estimate the amount of that loss, we accrue the estimated loss by a charge to income. In many actions, however, it is inherently difficult to determine whether any loss is probable or even reasonably possible, or to estimate the amount of any loss. In addition, even where loss is reasonably possible or an exposure to loss exists in excess of the liability already accrued with respect to a previously recognized loss contingency, it is not always possible to reasonably estimate the size of the possible loss or range of loss.

For certain legal actions, we cannot reasonably estimate such losses, particularly for actions that are in their early stages of development or where plaintiffs seek substantial or indeterminate damages. Numerous issues may need to be resolved, including through potentially lengthy discovery and determination of important factual matters, and by addressing novel or unsettled legal questions relevant to the actions in question, before a loss or additional loss or range of loss or range of additional loss can be reasonably estimated for any given action.

For certain other legal actions, we can estimate reasonably possible losses, additional losses, ranges of loss or ranges of additional loss in excess of amounts accrued, but do not believe, based on current knowledge and after consultation with counsel, that such losses will have a material adverse effect on our consolidated financial statements as a whole.

In March 2022, the staff of the United States Consumer Financial Protection Bureau (“CFPB”) notified us that, in accordance with the CFPB’s discretionary Notice and Opportunity to Respond and Advise (“NORA”) process, it is considering recommending that the CFPB take legal action against the Company in connection with alleged violations of the Consumer Financial Protection Act, 12 U.S.C. §§ 5531, 5536. The staff’s investigation is focused on certain refunding practices for optional insurance and membership plan products that were subsequently canceled by the consumer after purchase. We are cooperating with the CFPB in this matter and expect ongoing interactions. Although the Company believes it has not violated the Consumer Financial Protection Act, we are unable to estimate how long this investigation will continue, whether and in what manner the CFPB may commence legal action, or what the ultimate outcome of this matter will be. Should the CFPB opt to commence legal proceedings, it may seek civil monetary penalties, restitution, injunctive relief, or other damages. The Company does not currently believe that the outcome of this matter will have a material adverse effect on our business, financial condition, or results of operations.

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13. Segment Information

At September 30, 2022, Consumer and Insurance (“C&I”) is our only reportable segment. The remaining components (which we refer to as “Other”) consist of our liquidating SpringCastle Portfolio servicing activity and our non-originating legacy operations, which primarily include our liquidating real estate loans.

The accounting policies of the C&I segment are the same as those disclosed in Note 2 and Note 17 of the Notes to the Consolidated Financial Statements in Part II - Item 8 included in our Annual Report.

The following tables present information about C&I and Other, as well as reconciliations to the consolidated financial statement amounts.

(dollars in millions)						Consumer and Insurance						Other						Segment to GAAP Adjustment						Consolidated Total
Three Months Ended September 30, 2022
Interest income						$	1,116					$	2					$	—					$	1,118
Interest expense						221						1						1						223
Provision for finance receivable losses						420						—						1						421
Net interest income after provision for finance receivable losses						475						1						(2)						474
Other revenues						168						3						(1)						170
Other expenses						392						3						(1)						394
Income before income tax expense						$	251					$	1					$	(2)					$	250
Three Months Ended September 30, 2021
Interest income						$	1,111					$	1					$	1					$	1,113
Interest expense						235						1						1						237
Provision for finance receivable losses						224						—						2						226
Net interest income after provision for finance receivable losses						652						—						(2)						650
Other revenues						151						4						—						155
Other expenses						415						5						9						429
Income (loss) before income tax expense (benefit)						$	388					$	(1)					$	(11)					$	376

Nine Months Ended September 30, 2022
Interest income						$	3,308					$	4					$	1					$	3,313
Interest expense						657						2						2						661
Provision for finance receivable losses						995						—						3						998
Net interest income after provision for finance receivable losses						1,656						2						(4)						1,654
Other revenues						451						10						(1)						460
Other expenses						1,179						11						(2)						1,188
Income before income tax expense						$	928					$	1					$	(3)					$	926
Assets						$	20,281					$	40					$	2,020					$	22,341
Nine Months Ended September 30, 2021
Interest income						$	3,237					$	4					$	3					$	3,244
Interest expense						698						3						2						703
Provision for finance receivable losses						351						—						5						356
Net interest income after provision for finance receivable losses						2,188						1						(4)						2,185
Other revenues						395						10						(9)						396
Other expenses						1,154						17						24						1,195
Income (loss) before income tax expense (benefit)						$	1,429					$	(6)					$	(37)					$	1,386
Assets						$	19,897					$	44					$	2,022					$	21,963

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14. Fair Value Measurements

The accounting policies of our fair value measurements are the same as those disclosed in Note 2 and Note 18 of the Notes to the Consolidated Financial Statements in Part II - Item 8 included in our Annual Report.

The following table presents the carrying amounts and estimated fair values of our financial instruments and indicates the level in the fair value hierarchy of the estimated fair value measurement based on the observability of the inputs used:

						Fair Value Measurements Using																		Total Fair Value						Total Carrying Value
(dollars in millions)						Level 1						Level 2						Level 3
September 30, 2022
Assets
Cash and cash equivalents						$	536					$	—					$	—					$	536					$	536
Investment securities						50						1,687						10						1,747						1,747
Net finance receivables, less allowance for finance receivable losses						—						—						19,542						19,542						17,497
Restricted cash and restricted cash equivalents						483						—						—						483						483
Other assets *						—						—						45						45						37
Liabilities
Long-term debt						$	—					$	16,530					$	—					$	16,530					$	18,202
December 31, 2021
Assets
Cash and cash equivalents						$	535					$	6					$	—					$	541					$	541
Investment securities						59						1,927						6						1,992						1,992
Net finance receivables, less allowance for finance receivable losses						—						—						20,083						20,083						17,117
Restricted cash and restricted cash equivalents						476						—						—						476						476
Other assets *						—						—						52						52						46
Liabilities
Long-term debt						$	—					$	18,781					$	—					$	18,781					$	17,750

*Other assets at September 30, 2022 and December 31, 2021 primarily consists of finance receivables held for sale.

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FAIR VALUE MEASUREMENTS — RECURRING BASIS

The following tables present information about our assets measured at fair value on a recurring basis and indicates the fair value hierarchy based on the levels of inputs we utilized to determine such fair value:

						Fair Value Measurements Using																		Total Carried At Fair Value
(dollars in millions)						Level 1						Level 2						Level 3
September 30, 2022
Assets
Cash equivalents in mutual funds						$	26					$	—					$	—					$	26
Investment securities:
Available-for-sale securities
U.S. government and government sponsored entities						—						11						—						11
Obligations of states, municipalities, and political subdivisions						—						64						—						64
Commercial paper						—						53						—						53
Non-U.S. government and government sponsored entities						—						135						—						135
Corporate debt						6						1,105						3						1,114
RMBS						—						178						6						184
CMBS						—						36						—						36
CDO/ABS						—						80						—						80
Total available-for-sale securities						6						1,662						9						1,677
Other securities
Bonds:
Corporate debt						—						8						—						8
RMBS						—						1						—						1
CDO/ABS						—						16						—						16
Total bonds						—						25						—						25
Preferred stock						16						—						—						16
Common stock						28						—						1						29
Total other securities						44						25						1						70
Total investment securities						50						1,687						10						1,747
Restricted cash equivalents in mutual funds						476						—						—						476
Total						$	552					$	1,687					$	10					$	2,249

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						Fair Value Measurements Using																		Total Carried At Fair Value
(dollars in millions)						Level 1						Level 2						Level 3
December 31, 2021
Assets
Cash equivalents in mutual funds						$	41					$	—					$	—					$	41
Cash equivalents in securities						—						6						—						6
Investment securities:
Available-for-sale securities
U.S. government and government sponsored entities						—						16						—						16
Obligations of states, municipalities, and political subdivisions						—						79						—						79
Commercial paper						—						50						—						50
Non-U.S. government and government sponsored entities						—						155						—						155
Corporate debt						5						1,292						5						1,302
RMBS						—						170						—						170
CMBS						—						45						—						45
CDO/ABS						—						90						—						90
Total available-for-sale securities						5						1,897						5						1,907
Other securities
Bonds:
Corporate debt						—						9						—						9
RMBS						—						1						—						1
CDO/ABS						—						20						—						20
Total bonds						—						30						—						30
Preferred stock						22						—						—						22
Common stock						32						—						1						33
Total other securities						54						30						1						85
Total investment securities						59						1,927						6						1,992
Restricted cash equivalents in mutual funds						468						—						—						468
Total						$	568					$	1,933					$	6					$	2,507

Due to the insignificant activity within the Level 3 assets during the three and nine months ended September 30, 2022 and 2021, we have omitted the additional disclosures relating to the changes in Level 3 assets measured at fair value on a recurring basis and the quantitative information about Level 3 unobservable inputs.

FAIR VALUE MEASUREMENTS — NON-RECURRING BASIS

We measure the fair value of certain assets on a non-recurring basis when events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. Net impairment charges recorded on assets measured at fair value on a non-recurring basis were immaterial during the three and nine months ended September 30, 2022 and 2021.

FAIR VALUE MEASUREMENTS — VALUATION METHODOLOGIES AND ASSUMPTIONS

See Note 18 of the Notes to the Consolidated Financial Statements in Part II - Item 8 included in our Annual Report for information regarding our methods and assumptions used to estimate fair value.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

An index to our management’s discussion and analysis follows:

Topic						Page
Forward-Looking Statements						39
Overview						40
Recent Developments and Outlook						41
Results of Operations						43
Segment Results						46
Credit Quality						48
Liquidity and Capital Resources						53
Critical Accounting Policies and Estimates						58
Recent Accounting Pronouncements						58
Seasonality						58

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Forward-Looking Statements

This report contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not statements of historical fact, but instead represent only management’s current beliefs regarding future events. By their nature, forward-looking statements are subject to risks, uncertainties, assumptions, and other important factors that may cause actual results, performance, or achievements to differ materially from those expressed in or implied by such forward-looking statements. We caution you not to place undue reliance on these forward-looking statements, which speak only as of the date they were made. We do not undertake any obligation to update or revise these forward-looking statements to reflect events or circumstances after the date of this report or to reflect the occurrence of unanticipated events or the non-occurrence of anticipated events, whether as a result of new information, future developments, or otherwise, except as required by law. Forward-looking statements include, without limitation, statements concerning future plans, objectives, goals, projections, strategies, events, or performance, and underlying assumptions and other statements related thereto. Statements preceded by, followed by or that otherwise include the words “anticipates,” “appears,” “are likely,” “assumes,” “believes,” “can,” “continues,” “could,” “estimates,” “expects,” “forecasts,” “foresees,” “goals,” “intends,” “likely,” “objective,” “plans,” “projects,” “target,” “trend,” “remains,” and similar expressions or future or conditional verbs such as “could,” “may,” “might,” “should,” “will,” or “would” are intended to identify forward-looking statements, but these words are not the exclusive means of identifying forward-looking statements. Important factors that could cause actual results, performance, or achievements to differ materially from those expressed in or implied by forward-looking statements include, without limitation, the following:

•adverse changes and volatility in general economic conditions, including the interest rate environment and the financial markets;

•risks associated with the coronavirus (“COVID-19”) pandemic and the measures taken in response thereto;

•geopolitical risks, including recent geopolitical actions outside the U.S.;

•the sufficiency of our allowance for finance receivable losses;

•increased levels of unemployment and personal bankruptcies;

•natural or accidental events such as earthquakes, hurricanes, pandemics, floods, or wildfires affecting our customers, collateral, or our facilities;

•a failure in or breach of our information, operational or security systems, or infrastructure or those of third parties, including as a result of cyber-attacks, war, or other disruptions;

•the adequacy of our credit risk scoring models;

•adverse changes in our ability to attract and retain employees or key executives;

•increased competition or adverse changes in customer responsiveness to our distribution channels or products;

•changes in federal, state, or local laws, regulations, or regulatory policies and practices or increased regulatory scrutiny of our industry;

•risks associated with our insurance operations;

•the current inflationary environment and related trends affecting our customers;

•the costs and effects of any actual or alleged violations of any federal, state, or local laws, rules or regulations;

•the costs and effects of any fines, penalties, judgments, decrees, orders, inquiries, investigations, subpoenas, or enforcement or other proceedings of any governmental or quasi-governmental agency or authority;

•our substantial indebtedness and our continued ability to access the capital markets and maintain adequate current sources of funds to satisfy our cash flow requirements;

•our ability to comply with all of our covenants; and

•the effects of any downgrade of our debt ratings by credit rating agencies.

We also direct readers to the other risks and uncertainties discussed in other documents we file with the SEC.

If one or more of these or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, our actual results may vary materially from what we may have expressed or implied by these forward-looking statements. You should specifically consider the factors identified in this report and in the documents we file with the SEC that could cause actual results to differ before making an investment decision to purchase our securities and should not place undue reliance on any of our forward-looking statements. Furthermore, new risks and uncertainties arise from time to time, and it is impossible for us to predict those events or how they may affect us.

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Overview

We are the leader in offering nonprime customers responsible access to credit. Our customers are hardworking Americans who have been largely underserved by traditional lenders such as banks and credit unions. We believe our customers deserve fair and responsible access to credit, and we empower them to solve today’s problems and reach a better financial future through our personalized solutions.

We operate in the United States and market our personal loans in 44 states. In the third quarter of 2021, we began offering two credit cards, BrightWay and BrightWay+, which are designed to reward customers for responsible credit activity such as consistent on-time payments. We continue to expand BrightWay and BrightWay+ credit cards across our branch network, through direct mail, and through our digital affiliates. In connection with our offerings, our insurance subsidiaries offer our personal loan customers optional credit and non-credit insurance, and other insurance-related products. We strive to meet our customers at their preferred channel and to deliver a seamless customer experience through our digital platforms or working with our expert team members at our approximately 1,400 locations. Our personal loans, credit cards, and other products help customers meet everyday needs and take steps to improve their financial well-being.

In addition to our loan originations, insurance, and other product sales activities, we also service the loans that we originate and retain on our balance sheet, as well as loans owned by third parties on their behalf in connection with our whole loan sale program and legacy businesses. We also pursue strategic acquisitions and dispositions of assets and businesses, including loan portfolios or other financial assets, and may establish joint ventures or enter into other strategic alliances.

OUR PRODUCTS

Our product offerings include:

•Personal Loans — We offer personal loans through our branch network, centralized operations, and our website, www.omf.com, to customers who need timely access to cash. Our personal loans are non-revolving, with a fixed rate, fixed terms generally between three and six years, and are secured by automobiles, other titled collateral, or are unsecured. At September 30, 2022, we had approximately 2.34 million personal loans totaling $19.7 billion of net finance receivables, of which 52% were secured by titled property, compared to approximately 2.34 million personal loans totaling $19.2 billion of net finance receivables, of which 52% were secured by titled property at December 31, 2021. We also service personal loans for our whole loan sale partners.

•Credit Cards — In the third quarter of 2021, we began offering credit cards through a third-party bank partner from which we purchase the receivable balances. The credit cards are offered through our branch network, direct mail marketing, and direct-to-consumer via our affiliates. Credit cards are open-ended, revolving, with a fixed rate, and are unsecured. At September 30, 2022, we had approximately 104 thousand open credit card customer accounts, totaling $79 million of net finance receivables, compared to approximately 66 thousand open credit card customer accounts, totaling $25 million of net finance receivables at December 31, 2021.

•Insurance Products — We offer our customers optional credit insurance products (life, disability, and involuntary unemployment insurance) and optional non-credit insurance products through both our branch network and our centralized operations. Credit insurance and non-credit insurance products are provided by our affiliated insurance companies. We offer GAP coverage as a waiver product or insurance. We also offer optional membership plans from an unaffiliated company.

Our non-originating legacy products include:

•Other Receivables — We ceased originating real estate loans in 2012 and we continue to service or sub-service liquidating real estate loans. Our real estate loans held for sale are reported in “Other assets” of our consolidated balance sheets.

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OUR SEGMENT

At September 30, 2022, Consumer and Insurance (“C&I”) is our only reportable segment, which includes personal loans, credit cards, and insurance products. At September 30, 2022, we managed a combined total of 2.53 million customer accounts and $20.5 billion of managed receivables, compared to 2.45 million customer accounts and $19.6 billion of managed receivables at December 31, 2021.

The remaining components (which we refer to as “Other”) consist of our liquidating SpringCastle Portfolio servicing activity and our non-originating legacy operations, which primarily include our liquidating real estate loans. See Note 13 of the Notes to the Condensed Consolidated Financial Statements included in this report for more information about our segment.

Recent Developments and Outlook

RECENT DEVELOPMENTS

Stock Repurchase Program

On February 2, 2022, the Board authorized a stock repurchase program, which allows us to repurchase up to $1.0 billion of OMH’s outstanding common stock, excluding fees, commissions, and other expenses related to the repurchases. The authorization expires on December 31, 2024. As of September 30, 2022, we had $782 million of authorized share repurchase capacity, excluding fees and commissions, remaining under the program.

See “Liquidity and Capital Resources” under Management’s Discussion and Analysis of Financial Condition and Results of Operations and Item 2. Unregistered Sales of Equity Securities and Use of Proceeds in Part II of this report for further information on our shares repurchased.

Social Securitization Transaction - OMFIT 2022-S1

As part of our continued commitment to improve the financial well-being of hardworking Americans, on April 27, 2022, OMFC completed its first social securitization under Rule 144A. We issued $600 million principal amount of notes backed by personal loans (“OMFIT 2022-S1”) made to the target population identified in the OneMain 2022 ABS Social Framework. OMFIT 2022-S1 has a revolving period of three years, during which no principal payments are required. Generally, the target population is comprised of borrowers residing in rural communities (by zip code), 75% of whom are lower income borrowers in these communities. Through the OneMain 2022 ABS Social Bond Framework we aim to promote financial inclusion to the target population by providing equitable access to fair and transparent credit. The OneMain 2022 ABS Social Bond Framework, which is available on OneMain’s Investor Relations website, aligns to the Social Bond Principles 2021, as administered by the International Capital Market Association.

Private Secured Term Funding

On April 25, 2022, OMFC entered into a $350 million private secured term funding collateralized by our personal loans. No principal payments are required to be made during the first three years, followed by a subsequent one-year amortization period at the expiration of which the outstanding principal amount is due and payable.

Securitization Transactions Completed - ODART 2022-1 and OMFIT 2022-2

For information regarding the issuances of our secured debt, see “Liquidity and Capital Resources” under Management’s Discussion and Analysis of Financial Condition and Results of Operations in this report.

Redemption of 8.875% Senior Notes Due 2025

On June 1, 2022, OMFC paid a net aggregate amount of $637 million, inclusive of accrued interest and premiums, to complete the redemption of its 8.875% Senior Notes due 2025.

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Unsecured Corporate Revolver

On June 15, 2022, OMFC increased the total maximum borrowing capacity of its unsecured corporate revolver to $1.25 billion. At September 30, 2022, no amounts were drawn under this facility.

For further information regarding the redemption of our unsecured debt and our corporate revolver, see Note 6 of the Notes to the Condensed Consolidated Financial Statements included in this report.

Cash Dividends to OMH's Common Stockholders

For information regarding the quarterly dividends declared by OMH, see “Liquidity and Capital Resources” under Management’s Discussion and Analysis of Financial Condition and Results of Operations in this report.

Election and Resignation of Members of the OMH Board of Directors

On January 27, 2022, Toos N. Daruvala was elected to the OMH Board of Directors, effective February 14, 2022.

On February 24, 2022, Peter B. Sinensky resigned from the OMH Board of Directors.

Management’s Response to the COVID-19 Pandemic

In early 2020, COVID-19 evolved into a global pandemic, resulting in widespread volatility and deterioration in economic conditions across the states and regions that we serve. Throughout the pandemic, we have maintained our focus on assisting and supporting our customers, while remaining committed to the safety of our employees. We continue to serve our customers by keeping our branch locations open with appropriate protective protocols in place and through our digital platform. This hybrid capability has sustained our operating performance through the pandemic and enabled us to serve and support our customers effectively.

OUTLOOK

We are actively monitoring the current macroeconomic developments, including recent geopolitical actions outside of the U.S., and remain prepared for any additional opportunities or challenges that may impact our business. Our financial condition and results of operations could be affected by macroeconomic conditions, including unemployment, inflation, interest rates, and consumer confidence. We will continue to incorporate updates to our macroeconomic assumptions, as necessary, which could lead to further adjustments in our allowance for finance receivable losses, allowance ratio, and provision for finance receivable losses.

Our cumulative investments in our digital capabilities, combined with our proprietary data and advanced analytics, have allowed us to serve our customers through the branch, over the phone, and remotely throughout the pandemic and into the future.

Our experienced management team continues to remain focused on maintaining a solid balance sheet with a strong liquidity runway and capital coverage, upholding a conservative and disciplined underwriting model, and building strong relationships with our customers to ensure that we are serving them well. We believe we are well positioned to serve our customers, invest in our business, and drive long-term growth to create value for our stockholders as we navigate the evolving economic, social, political, and regulatory environment.

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Results of Operations

The results of OMFC are consolidated into the results of OMH. Due to the nominal differences between OMFC and OMH, content throughout this section relates only to OMH. See Note 1 of the Notes to the Condensed Consolidated Financial Statements included in this report for further information.

OMH'S CONSOLIDATED RESULTS

See the table below for OMH's consolidated operating results and selected financial statistics. A further discussion of OMH's operating results for our operating segment is provided under “Segment Results” below.

						At or for the Three Months Ended September 30,												At or for the Nine Months Ended September 30,
(dollars in millions, except per share amounts)						2022						2021						2022						2021
Interest income						$	1,118					$	1,113					$	3,313					$	3,244
Interest expense						223						237						661						703
Provision for finance receivable losses						421						226						998						356
Net interest income after provision for finance receivable losses						474						650						1,654						2,185
Other revenues						170						155						460						396
Other expenses						394						429						1,188						1,195
Income before income taxes						250						376						926						1,386
Income taxes						62						88						228						335
Net income						$	188					$	288					$	698					$	1,051
Share Data:
Earnings per share:
Diluted						$	1.52					$	2.17					$	5.57					$	7.84
Selected Financial Statistics (a)
Total finance receivables:
Net finance receivables						$	19,752					$	18,843					$	19,752					$	18,843
Average net receivables						$	19,623					$	18,545					$	19,289					$	18,029
Yield						22.57		%				23.79		%				22.94		%				24.02		%
Gross charge-off ratio						7.12		%				4.76		%				7.15		%				5.41		%
Recovery ratio						(1.20)		%				(1.24)		%				(1.34)		%				(1.23)		%
Net charge-off ratio						5.92		%				3.52		%				5.81		%				4.19		%
Personal loans:
Net finance receivables						$	19,673					$	18,843					$	19,673					$	18,843
Origination volume						$	3,551					$	3,870					$	10,406					$	9,989
Number of accounts						2,342,080						2,333,941						2,342,080						2,333,941
Number of accounts originated						353,932						404,148						1,036,225						1,018,470
30-89 Delinquency ratio						2.81		%				2.20		%				2.81		%				2.20		%
Credit cards (b):
Net finance receivables						$	79					$	—					$	79					$	—
Purchase volume						$	38					$	—					$	116					$	—
Number of open accounts						104,327						—						104,327						—
30-89 Delinquency ratio						6.58		%				—		%				6.58		%				—		%
Debt balances:
Long-term debt balance						$	18,202					$	17,661					$	18,202					$	17,661
Average daily debt balance						$	18,004					$	17,680					$	17,750					$	17,192

(a)    See “Glossary” at the beginning of this report for formulas and definitions of our key performance ratios.

(b)    The amounts associated with credit cards for the three and nine months ended September 30, 2021 were immaterial, as the product offering began in the third quarter of 2021.

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Comparison of Consolidated Results for the Three and Nine Months Ended September 30, 2022 and 2021

Interest income increased $5 million, less than 1%, and $69 million or 2% for the three and nine months ended September 30, 2022, respectively, when compared to the same periods in 2021 primarily due to growth in our loan portfolio, partially offset by lower yield.

Interest expense decreased $14 million or 6% and $42 million or 6% for the three and nine months ended September 30, 2022, respectively, when compared to the same periods in 2021 primarily due to a lower average cost of funds, partially offset by an increase in average debt.

See Notes 6 and 7 of the Notes to the Condensed Consolidated Financial Statements included in this report for further information on our long-term debt, securitization transactions, private secured term funding, and our revolving conduit facilities.

Provision for finance receivable losses increased $195 million or 86% and $642 million or 180% for the three and nine months ended September 30, 2022, respectively, when compared to the same periods in 2021 primarily driven by higher net charge-offs and an increase in the allowance for finance receivable losses due to the weakened macroeconomic environment and growth in the portfolio.

Other revenues increased $15 million or 10% and $64 million or 16% for the three and nine months ended September 30, 2022, respectively, when compared to the same periods in 2021 primarily due to an increase in gains on the sales of finance receivables and an increase in servicing revenue associated with the whole loan sale program as a result of more loans sold in the current period and lower net losses on the repurchases and repayments of debt in the current period compared to the prior year period.

Other expenses decreased $35 million or 8% for the three months ended September 30, 2022 when compared to the same period in 2021 primarily due to a decrease in insurance policy and benefits claims expense due to favorable development of credit life claims and cash-settled stock-based awards expense in the prior year period, partially offset by an increase in salaries and benefits driven by the continued investment in our business.

Other expenses decreased $7 million, less than 1%, for the nine months ended September 30, 2022 when compared to the same period in 2021 due to a decrease in insurance policy and benefits claims expense due to favorable development of credit life, credit disability, and term life claims and cash-settled stock-based awards expense in the prior year period, offset by an increase in salaries and benefits driven by the continued investment in our business.

Income taxes totaled $62 million and $228 million for the three and nine months ended September 30, 2022, respectively, compared to $88 million and $335 million for the three and nine months ended September 30, 2021, respectively, due to higher pre-tax income in the prior year period.

For the three and nine months ended September 30, 2022 the effective tax rates were 24.7% and 24.6%, respectively, compared to 23.5% and 24.2% for the three and nine months ended September 30, 2021, respectively. The effective tax rates differed from the federal statutory rate of 21% primarily due to the effect of state income taxes. See Note 11 of the Notes to the Condensed Consolidated Financial Statements included in this report for further information on effective tax rates.

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NON-GAAP FINANCIAL MEASURES

Management uses C&I adjusted pretax income (loss), a non-GAAP financial measure, as a key performance measure of our segment. C&I adjusted pretax income (loss) represents income (loss) before income taxes on a Segment Accounting Basis and excludes the expense associated with the net gain or loss resulting from repurchases and repayments of debt, the cash-settled stock-based awards, direct costs associated with COVID-19, and restructuring charges. Management believes C&I adjusted pretax income (loss) is useful in assessing the profitability of our segment.

Management also uses C&I pretax capital generation, a non-GAAP financial measure, as a key performance measure of our segment. This measure represents C&I adjusted pretax income as discussed above and excludes the change in our C&I allowance for finance receivable losses in the period while still considering the C&I net charge-offs incurred during the period. Management believes that C&I pretax capital generation is useful in assessing the capital created in the period impacting the overall capital adequacy of the Company. Management believes that the Company’s reserves, combined with its equity, represent the Company’s loss absorption capacity.

Management utilizes both C&I adjusted pretax income (loss) and C&I pretax capital generation in evaluating our performance. Additionally, both of these non-GAAP measures are consistent with the performance goals established in OMH’s executive compensation program. C&I adjusted pretax income (loss) and C&I pretax capital generation are non-GAAP financial measures and should be considered supplemental to, but not as a substitute for or superior to, income (loss) before income taxes, net income, or other measures of financial performance prepared in accordance with GAAP.

OMH's reconciliations of income before income tax expense on a Segment Accounting Basis to C&I adjusted pretax income (non-GAAP) and C&I pretax capital generation (non-GAAP) were as follows:

						Three Months Ended September 30,												Nine Months Ended September 30,
(dollars in millions)						2022						2021						2022						2021
Consumer and Insurance
Income before income taxes - Segment Accounting Basis						$	251					$	388					$	928					$	1,429
Adjustments:
Net (gain) loss on repurchases and repayments of debt						(3)						1						25						40
Cash-settled stock-based awards						(2)						31						1						31
Direct costs associated with COVID-19						1						1						3						5
Restructuring charges						3						—						2						—
Adjusted pretax income (non-GAAP)						250						421						959						1,505
Provision for finance receivable losses						420						224						995						351
Net charge-offs						(293)						(165)						(838)						(564)
Pretax capital generation (non-GAAP)						$	377					$	480					$	1,116					$	1,292

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Segment Results

The results of OMFC are consolidated into the results of OMH. Due to the nominal differences between OMFC and OMH, content throughout this section relate only to OMH. See Note 1 of the Notes to the Condensed Consolidated Financial Statements included in this report for further information.

See Note 17 of the Notes to the Consolidated Financial Statements in Part II - Item 8 included in our Annual Report for a description of our segment and methodologies used to allocate revenues and expenses to our C&I segment. See Note 13 of the Notes to the Condensed Consolidated Financial Statements included in this report for reconciliations of segment total to condensed consolidated financial statement amounts.

CONSUMER AND INSURANCE

OMH's adjusted pretax income and selected financial statistics for C&I on an adjusted Segment Accounting Basis were as follows:

						At or for the Three Months Ended September 30,												At or for the Nine Months Ended September 30,
(dollars in millions)						2022						2021						2022						2021
Interest income						$	1,116					$	1,111					$	3,308					$	3,237
Interest expense						221						235						657						698
Provision for finance receivable losses						420						224						995						351
Net interest income after provision for finance receivable losses						475						652						1,656						2,188
Other revenues						165						152						476						435
Other expenses						390						383						1,173						1,118
Adjusted pretax income (non-GAAP)						$	250					$	421					$	959					$	1,505
Selected Financial Statistics (a)
Total finance receivables:
Net finance receivables						$	19,754					$	18,847					$	19,754					$	18,847
Average net receivables						$	19,624					$	18,549					$	19,291					$	18,034
Yield						22.57		%				23.77		%				22.93		%				24.00		%
Gross charge-off ratio						7.12		%				4.77		%				7.15		%				5.41		%
Recovery ratio						(1.20)		%				(1.24)		%				(1.34)		%				(1.22)		%
Net charge-off ratio						5.92		%				3.52		%				5.81		%				4.19		%
Personal loans:
Net finance receivables						$	19,675					$	18,847					$	19,675					$	18,847
Origination volume						$	3,551					$	3,870					$	10,406					$	9,989
Number of accounts						2,342,080						2,333,941						2,342,080						2,333,941
Number of accounts originated						353,932						404,148						1,036,225						1,018,470
30-89 Delinquency ratio						2.81		%				2.20		%				2.81		%				2.20		%
Credit cards (b):
Net finance receivables						$	79					$	—					$	79					$	—
Purchase volume						$	38					$	—					$	116					$	—
Number of open accounts						104,327						—						104,327						—
30-89 Delinquency ratio						6.58		%				—		%				6.58		%				—		%

(a)    See “Glossary” at the beginning of this report for formulas and definitions of our key performance ratios.

(b)    The amounts associated with credit cards for the three and nine months ended September 30, 2021 were immaterial, as the product offering began in the third quarter of 2021.

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Comparison of Adjusted Pretax Income for the Three and Nine Months Ended September 30, 2022 and 2021

Interest income increased $5 million, less than 1% and $71 million or 2% for the three and nine months ended September 30, 2022, respectively, when compared to the same periods in 2021 primarily due to growth in our loan portfolio, partially offset by lower yield.

Interest expense decreased $14 million or 6% and $41 million or 6% for the three and nine months ended September 30, 2022, respectively, when compared to the same periods in 2021 primarily due to a lower average cost of funds, partially offset by an increase in average debt.

See Notes 6 and 7 of the Notes to the Condensed Consolidated Financial Statements included in this report for further information on our long-term debt, securitization transactions, private secured term funding, and our revolving conduit facilities.

Provision for finance receivable losses increased $196 million or 87% and $644 million or 183% for the three and nine months ended September 30, 2022, respectively, when compared to the same periods in 2021 primarily driven by higher net-charge offs and an increase in the allowance for finance receivable losses due to the weakened macroeconomic environment and growth in the portfolio.

Other revenues increased $13 million or 8% and $41 million or 9% for the three and nine months ended September 30, 2022, respectively, when compared to the same periods in 2021 primarily due to an increase in gains on the sales of finance receivables and an increase in servicing revenue associated with the whole loan sale program as a result of more loans sold in the current period.

Other expenses increased $7 million or 2% for the three months ended September 30, 2022 when compared to the same period in 2021 primarily due to an increase in salaries and benefits driven by the continued investment in our business, offset by a decrease in insurance policy and benefits claims expense due to favorable development of credit life claims.

Other expenses increased $55 million or 5% for the nine months ended September 30, 2022 when compared to the same period in 2021 primarily due to an increase in salaries and benefits and an increase in general operating expenses due to the continued investment in our business. The increase was offset by a decrease in insurance policy and benefits claims expense due to favorable development of credit life, credit disability, and term life claims.

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Credit Quality

FINANCE RECEIVABLES

Our net finance receivables, consisting of personal loans and credit cards, were $19.8 billion at September 30, 2022 and $19.2 billion at December 31, 2021. Our personal loans are non-revolving, with a fixed-rate, fixed terms generally between three and six years, and are secured by automobiles, other titled collateral, or are unsecured. During the third quarter of 2021, we began offering credit cards. Credit cards are open-ended, revolving, with a fixed rate, and are unsecured. We consider the delinquency status of our finance receivables as our key credit quality indicator. We monitor the delinquency of our finance receivable portfolio, including the migration between the delinquency buckets and changes in the delinquency trends to manage our exposure to credit risk in the portfolio. Our branch and central operation team members work with customers as necessary and offer a variety of borrower assistance programs to help customers continue to make payments.

DELINQUENCY

We monitor delinquency trends to evaluate the risk of future credit losses and employ advanced analytical tools to manage our exposure. Team members are actively engaged in collection activities throughout the early stages of delinquency. We closely track and report the percentage of receivables that are contractually 30-89 days past due as a benchmark of portfolio quality, collections effectiveness, and as a strong indicator of losses in coming quarters.

When personal loans are contractually 60 days past due, we consider these accounts to be at an increased risk for loss and collection of these accounts is managed by our centralized operations. Use of our centralized operations teams for managing late-stage delinquency allows us to apply more advanced collection technologies and tools and drives operating efficiencies in servicing. We consider our personal loans to be nonperforming at 90 days contractually past due, at which point we stop accruing finance charges and reverse finance charges previously accrued.

We accrue finance charges and fees on credit cards until charge-off at approximately 180 days past due, at which point we reverse finance charges and fees previously accrued.

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The delinquency information for net finance receivables on a Segment Accounting Basis was as follows:

						Consumer and Insurance
(dollars in millions)						Personal Loans						Credit Cards
September 30, 2022
Current						$	18,648					$	69
30-59 days past due						326						3
60-89 days past due						227						2
90+ days past due						474						5
Total net finance receivables						$	19,675					$	79
Delinquency ratio
30-89 days past due						2.81		%				6.58		%
30+ days past due						5.22		%				13.42		%
60+ days past due						3.56		%				9.60		%
90+ days past due						2.41		%				6.84		%
December 31, 2021
Current						$	18,340					$	25
30-59 days past due						282						—
60-89 days past due						185						—
90+ days past due						383						—
Total net finance receivables						$	19,190					$	25
Delinquency ratio
30-89 days past due						2.43		%				0.08		%
30+ days past due						4.43		%				0.08		%
60+ days past due						2.96		%				—		%
90+ days past due						2.00		%				—		%

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ALLOWANCE FOR FINANCE RECEIVABLE LOSSES

We estimate and record an allowance for finance receivable losses to cover the estimated lifetime expected credit losses on our finance receivables. Our allowance for finance receivable losses may fluctuate based upon changes in portfolio growth, credit quality, and economic conditions.

Our current methodology to estimate expected credit losses used the most recent macroeconomic forecasts, which incorporated the overall unemployment rate. Our unemployment outlook leveraged projections from various industry leading forecast providers. We also considered inflationary pressures, consumer confidence levels, and the risk of ongoing interest rate increases negatively impacting the economic outlook. At September 30, 2022, our economic forecast used a reasonable and supportable period of 12 months. We may experience further changes to the macroeconomic assumptions within our forecast, as well as changes to our loan loss performance outlook, both of which could lead to further changes in our allowance for finance receivable losses, allowance ratio, and provision for finance receivable losses.

Changes in our allowance for finance receivable losses were as follows:

(dollars in millions)						Consumer and Insurance																		Segment to GAAP Adjustment						Consolidated Total
						Personal Loans						Credit Cards
Three Months Ended September 30, 2022
Balance at beginning of period						$	2,120					$	12											$	(5)					$	2,127
Provision for finance receivable losses						414						6												1						421
Charge-offs						(349)						(3)												—						(352)
Recoveries						59						—												—						59
Balance at end of period						$	2,244					$	15											$	(4)					$	2,255
Three Months Ended September 30, 2021 (a)
Balance at beginning of period						$	2,011					$	—											$	(11)					$	2,000
Provision for finance receivable losses						224						—												2						226
Charge-offs						(223)						—												—						(223)
Recoveries						58						—												—						58
Balance at end of period						$	2,070					$	—											$	(9)					$	2,061
Nine Months Ended September 30, 2022
Balance at beginning of period						$	2,097					$	5											$	(7)					$	2,095
Provision for finance receivable losses						982						13												3						998
Charge-offs						(1,029)						(3)												—						(1,032)
Recoveries						194						—												—						194
Balance at end of period						$	2,244					$	15											$	(4)					$	2,255
Allowance ratio						11.41		%				19.14		%										(b)						11.42		%
Nine Months Ended September 30, 2021 (a)
Balance at beginning of period						$	2,283					$	—											$	(14)					$	2,269
Provision for finance receivable losses						351						—												5						$	356
Charge-offs						(730)						—												—						$	(730)
Recoveries						166						—												—						$	166
Balance at end of period						$	2,070					$	—											$	(9)					$	2,061
Allowance ratio						10.98		%				—		%										(b)						10.94		%

(a) The allowance for finance receivable losses for credit cards was immaterial for the three and nine months ended September 30, 2021 as the product offering began in the third quarter of 2021.

(b) Not applicable.

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The current delinquency status of our finance receivable portfolio, inclusive of recent borrower performance, volume of our TDR activity, level and recoverability of collateral securing our finance receivable portfolio, and the reasonable and supportable forecast of economic conditions are the primary drivers that can cause fluctuations in our allowance ratio from period to period. We monitor the allowance ratio to ensure we have a sufficient level of allowance for finance receivable losses based on the estimated lifetime expected credit losses in our finance receivable portfolio. The allowance for finance receivable losses as a percentage of net finance receivables for personal loans increased from the prior year period primarily due to the weakened macroeconomic environment. See Note 4 of the Notes to the Condensed Consolidated Financial Statements included in this report for more information about the changes in the allowance for finance receivable losses.

TDR FINANCE RECEIVABLES

We make modifications to our finance receivables to assist borrowers experiencing financial difficulties. When we modify a loan’s contractual terms for economic or other reasons related to the borrower’s financial difficulties and grant a concession that we would not otherwise consider, we classify that loan as a TDR finance receivable.

Information regarding TDR net finance receivables for personal loans are as follows:

(dollars in millions)						Personal Loans																		Segment to GAAP Adjustment						GAAP Basis
September 30, 2022
TDR net finance receivables						$	815																	$	(13)					$	802
Allowance for TDR finance receivable losses						312																		(5)						307
December 31, 2021
TDR net finance receivables						$	671																	$	(21)					$	650
Allowance for TDR finance receivable losses						279																		(9)						270

There were no credit cards classified as TDR finance receivables at September 30, 2022 or December 31, 2021.

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DISTRIBUTION OF FINANCE RECEIVABLES BY FICO SCORE

There are many different categorizations used in the consumer lending industry to describe the creditworthiness of a borrower, including prime, near-prime, and sub-prime. While management does not utilize credit scores to manage credit quality, we group FICO scores into the following categories for comparability purposes across our industry:

•Prime: FICO score of 660 or higher

•Near-prime: FICO score of 620-659

•Sub-prime: FICO score of 619 or below

Our customers’ demographics are, in many respects, near the national median but may vary from national norms in terms of credit and repayment histories. Many of our customers have experienced some level of prior financial difficulty or have limited credit experience and require higher levels of servicing and support from our branch network and central servicing operations.

The following table reflects our net finance receivables grouped into the borrower categories described above based on borrower FICO credit scores as of the most recently refreshed date or as of the loan origination or purchase date:

(dollars in millions)						Personal Loans						Credit Cards						Total
September 30, 2022
FICO scores
660 or higher						$	4,329					$	10					$	4,339
620-659						5,070						26						5,096
619 or below						10,274						43						10,317
Total						$	19,673					$	79					$	19,752
December 31, 2021
FICO scores *
660 or higher						$	4,897					$	14					$	4,911
620-659						5,321						7						5,328
619 or below						8,969						4						8,973
Total						$	19,187					$	25					$	19,212

* Due to the impact of COVID-19, FICO scores as of December 31, 2021 may have been positively impacted by government stimulus measures, borrower assistance programs, and potentially inconsistent reporting to credit bureaus.

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Liquidity and Capital Resources

SOURCES AND USES OF FUNDS

We finance the majority of our operating liquidity and capital needs through a combination of cash flows from operations, secured debt, unsecured debt, borrowings from revolving conduit facilities, whole loan sales, and equity. We may also utilize other sources in the future. As a holding company, all of the funds generated from our operations are earned by our operating subsidiaries. Our operating subsidiaries’ primary cash needs relate to funding our lending activities, our debt service obligations, our operating expenses, payment of insurance claims, and expenditures relating to upgrading and monitoring our technology platform, risk systems, and branch locations.

We have previously purchased portions of our unsecured indebtedness, and we may elect to purchase additional portions of our unsecured indebtedness or securitized borrowings in the future. Future purchases may be made through the open market, privately negotiated transactions with third parties, or pursuant to one or more tender or exchange offers, all of which are subject to terms, prices, and consideration we may determine at our discretion.

During the nine months ended September 30, 2022, OMH generated net income of $698 million. OMH’s net cash inflow from operating and investing activities totaled $226 million for the nine months ended September 30, 2022. At September 30, 2022, our scheduled interest payments for the remainder of 2022 totaled $34 million, and there are no scheduled principal payments for the remainder of 2022 on our existing debt (excluding securitizations). As of September 30, 2022, we had $9.5 billion of unencumbered loans.

Based on our estimates and considering the risks and uncertainties of our plans, we believe that we will have adequate liquidity to finance and operate our businesses and repay our obligations as they become due for at least the next 24 months.

OMFC’s Unsecured Corporate Revolver

At September 30, 2022, the borrowing capacity of our corporate revolver was $1.25 billion, and no amounts were drawn.

OMFC’s Redemption and Repurchases of Unsecured Debt

For information regarding the redemption and open market repurchases of OMFC’s unsecured debt, see Note 6 of the Notes to the Condensed Consolidated Financial Statements included in this report.

Securitizations and Borrowings from Revolving Conduit Facilities

During the nine months ended September 30, 2022, we completed three personal loan securitizations (OMFIT 2022-S1, ODART 2022-1, and OMFIT 2022-2, see “Securitized Borrowings” below) and redeemed four personal loan securitizations (ODART 2018-1, OMFIT 2019-1, OMFIT 2015-3, and OMFIT 2018-1). During the nine months ended September 30, 2022, we entered into one new revolving conduit facility. At September 30, 2022, an aggregate of $500 million was drawn under our conduit facilities, and the remaining borrowing capacity was $5.7 billion. At September 30, 2022, we had $10.0 billion of gross finance receivables pledged as collateral for our securitizations, conduit facilities, and private secured term funding.

Private Secured Term Funding

On April 25, 2022, OMFC entered into a $350 million private secured term funding collateralized by our personal loans. No principal payments are required to be made during the first three years, followed by a subsequent one-year amortization period at the expiration of which the outstanding principal amount is due and payable.

See Notes 6 and 7 of the Notes to the Condensed Consolidated Financial Statements included in this report for further information on our long-term debt, securitization transactions, private secured term funding, and revolving conduit facilities.

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Credit Ratings

Our credit ratings impact our ability to access capital markets and our borrowing costs. Rating agencies base their ratings on numerous factors, including liquidity, capital adequacy, asset quality, quality of earnings, and the probability of systemic support. Significant changes in these factors could result in different ratings.

The table below outlines OMFC’s long-term corporate debt ratings and outlook by rating agencies:

As of September 30, 2022

Rating

Outlook

S&P

BB

Stable

Moody’s

Ba2

Stable

KBRA

BB+

Positive

Currently, no other entity has a corporate debt rating, though they may be rated in the future.

Stock Repurchased

During the nine months ended September 30, 2022, OMH repurchased 5,559,382 shares of its common stock through its stock repurchase program for an aggregate total of $247 million, including commissions and fees. As of September 30, 2022, OMH held a total of 12,214,566 shares of treasury stock. To provide funding for the OMH stock repurchases, the OMFC Board of Directors authorized dividend payments in the amount of $240 million.

For additional information regarding the shares repurchased, see Item 2. Unregistered Sales of Equity Securities and Use of Proceeds of Part II included in this report.

Cash Dividend to OMH's Common Stockholders

As of September 30, 2022, the dividend declarations for the current year by the Board were as follows:

Declaration Date						Record Date						Payment Date						Dividend Per Share									Amount Paid
																											(in millions)
February 2, 2022						February 14, 2022						February 18, 2022						$	0.95								$	121
April 28, 2022						May 9, 2022						May 13, 2022						0.95									118
July 27, 2022						August 8, 2022						August 12, 2022						0.95									117
Total																		$	2.85								$	356

To provide funding for the dividend, OMFC paid dividends of $355 million to OMH during the nine months ended September 30, 2022.

On October 26, 2022, OMH declared a dividend of $0.95 per share payable on November 14, 2022 to record holders of OMH's common stock as of the close of business on November 7, 2022. To provide funding for the OMH dividend, the OMFC Board of Directors authorized a dividend in the amount of up to $117 million payable on or after November 8, 2022.

While OMH intends to pay its minimum quarterly dividend, currently $0.95 per share, for the foreseeable future, all subsequent dividends will be reviewed and declared at the discretion of the Board and will depend on many factors, including our financial condition, earnings, cash flows, capital requirements, level of indebtedness, statutory and contractual restrictions applicable to the payment of dividends, and other considerations that the Board deems relevant. OMH’s dividend payments may change from time to time, and the Board may choose not to continue to declare dividends in the future. See our “Dividend Policy” in Part II - Item 5 included in our Annual Report for further information.

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Whole Loan Sale Transactions

As of September 30, 2022, we have whole loan sale flow agreements with third parties, with remaining terms of less than one year, in which we agreed to sell a combined total of $180 million gross receivables per quarter of newly originated unsecured personal loans along with any associated accrued interest. During the three and nine months ended September 30, 2022 we sold $180 million and $540 million of gross finance receivables, respectively, compared to $160 million and $325 million during the same periods in 2021. See Note 3 of the Notes to the Condensed Consolidated Financial Statements included in this report for further information on the whole loan sale transactions.

LIQUIDITY

OMH's Operating Activities

Net cash provided by operations of $1.7 billion for the nine months ended September 30, 2022 reflected net income of $698 million, the impact of non-cash items, and an unfavorable change in working capital of $124 million. Net cash provided by operations of $1.6 billion for the nine months ended September 30, 2021 reflected net income of $1.1 billion, the impact of non-cash items, and an unfavorable change in working capital of $53 million.

OMH's Investing Activities

Net cash used for investing activities of $1.5 billion for the nine months ended September 30, 2022 was primarily due to net principal originations and purchases of finance receivables and purchases of available-for-sale and other securities, partially offset by the proceeds from sales of finance receivables and calls, sales, and maturities of available-for-sale and other securities. Net cash used for investing activities of $1.5 billion for the nine months ended September 30, 2021 was primarily due to net principal originations of finance receivables and purchases of available-for-sale and other securities, partially offset by calls, sales and maturities of available-for-sale and other securities and proceeds from sales of finance receivables.

OMH's Financing Activities

Net cash used for financing activities of $224 million for the nine months ended September 30, 2022 was primarily due to debt repayments and repurchases, cash dividends paid, and the cash paid to repurchase common stock during the period, partially offset by the issuances of OMFIT 2022-S1, ODART 2022-1, OMFIT 2022-2, and the private secured term funding. Net cash used for financing activities of $1.6 billion for the nine months ended September 30, 2021 was primarily due to debt repayments and repurchases, cash dividends paid, and the cash paid on the common stock repurchased in the period, partially offset by the issuances of OMFIT 2021-1 securitization, the Social Bond, and the 3.875% Senior Notes due 2028.

OMH's Cash and Investments

At September 30, 2022, we had $536 million of cash and cash equivalents, which included $142 million of cash and cash equivalents held at our regulated insurance subsidiaries or for other operating activities that is unavailable for general corporate purposes.

At September 30, 2022, we had $1.7 billion of investment securities, which are all held as part of our insurance operations and are unavailable for general corporate purposes.

Liquidity Risks and Strategies

OMFC’s credit ratings are non-investment grade, which has a significant impact on our cost and access to capital. This, in turn, can negatively affect our ability to manage our liquidity and our ability or cost to refinance our indebtedness. There are numerous risks to our financial results, liquidity, capital raising, and debt refinancing plans, some of which may not be quantified in our current liquidity forecasts. These risks are further described in our “Liquidity and Capital Resources” of Management’s Discussion and Analysis of Financial Condition and Results of Operations in Part II - Item 7 included in our Annual Report.

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The principal factors that could decrease our liquidity are customer delinquencies and defaults, a decline in customer prepayments, rising interest rates, and a prolonged inability to adequately access capital market funding. We intend to support our liquidity position by utilizing strategies that are further described in our “Liquidity and Capital Resources” of Management’s Discussion and Analysis of Financial Condition and Results of Operations in Part II - Item 7 included in our Annual Report.

However, it is possible that the actual outcome of one or more of our plans could be materially different than expected or that one or more of our significant judgments or estimates could prove to be materially incorrect.

OUR INSURANCE SUBSIDIARIES

Our insurance subsidiaries are subject to state regulations that limit their ability to pay dividends. Triton paid an ordinary dividend to OneMain Financial Holdings, LLC of $50 million during the nine months ended September 30, 2022. AHL did not pay any dividends during the nine months ended September 30, 2022. Triton and AHL did not pay dividends during the nine months ended September 30, 2021. See Note 10 of the Notes to the Consolidated Financial Statements in Part II - Item 8 included in our Annual Report for further information on these state restrictions and the dividends paid by our insurance subsidiaries in 2021.

OUR DEBT AGREEMENTS

The debt agreements which OMFC and its subsidiaries are a party to include customary terms and conditions, including covenants and representations and warranties. See Note 8 of the Notes to the Consolidated Financial Statements in Part II - Item 8 included in our Annual Report for more information on the restrictive covenants under OMFC’s debt agreements, as well as the guarantees of OMFC’s long-term debt.

Securitized Borrowings

We execute private securitizations under Rule 144A of the Securities Act of 1933, as amended. As of September 30, 2022, our structured financings consisted of the following:

(dollars in millions)						Issue Amount (a)						Initial Collateral Balance						Current Note Amounts Outstanding (a)						Current Collateral Balance (b)						Current Weighted Average Interest Rate						Original Revolving Period
OMFIT 2016-3						350						397						38						127						6.58		%				5 years
OMFIT 2018-2						368						381						350						400						3.87		%				5 years
OMFIT 2019-2						900						947						900						995						3.30		%				7 years
OMFIT 2019-A						789						892						750						892						3.78		%				7 years
OMFIT 2020-1						821						958						586						680						4.23		%				2 years
OMFIT 2020-2						1,000						1,053						1,000						1,053						2.03		%				5 years
OMFIT 2021-1						850						904						850						904						2.10		%				5 years
OMFIT 2022-S1						600						652						600						652						4.31		%				3 years
OMFIT 2022-2 (c)						1,000						1,099						1,000						1,099						5.17		%				2 years
ODART 2019-1						737						750						700						750						3.79		%				5 years
ODART 2021-1						1,000						1,053						1,000						1,053						0.98		%				2 years
ODART 2022-1						600						632						600						631						4.74		%				2 years
Total securitizations						$	9,015					$	9,718					$	8,374					$	9,236

(a) Issue Amount includes the retained interest amounts as applicable and the Current Note Amounts Outstanding balances reflect pay-downs subsequent to note issuance and exclude retained interest amounts.

(b) Inclusive of in-process replenishments of collateral for securitized borrowings in a revolving status as of September 30, 2022.

(c) On September 9, 2022, we issued $1 billion of notes backed by personal loans. The notes mature in October 2034.

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Revolving Conduit Facilities

In addition to the structured financings, we had access to 15 revolving conduit facilities with a total borrowing capacity of $6.2 billion as of September 30, 2022:

(dollars in millions)						Advance Maximum Balance						Amount Drawn
OneMain Financial Funding VII, LLC						$	600					$	—
OneMain Financial Funding IX, LLC						600						—
OneMain Financial Auto Funding I, LLC						550						—
Seine River Funding, LLC						550						—
Chicago River Funding, LLC						375						—
Hudson River Funding, LLC						500						—
OneMain Financial Funding VIII, LLC						400						—
Mystic River Funding, LLC						350						—
Thayer Brook Funding, LLC						350						—
Columbia River Funding, LLC						350						—
Hubbard River Funding, LLC						250						—
New River Funding Trust						250						—
River Thames Funding, LLC						400						100
St. Lawrence River Funding, LLC						250						—
OneMain Financial Funding X, LLC						400						400
Total						$	6,175					$	500

OFF-BALANCE SHEET ARRANGEMENTS

We have no material off-balance sheet arrangements as defined by SEC rules, and we had no material off-balance sheet exposure to losses associated with unconsolidated VIEs at September 30, 2022 or December 31, 2021.

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Critical Accounting Policies and Estimates

We describe our significant accounting policies used in the preparation of our consolidated financial statements in Note 2 of the Notes to the Consolidated Financial Statements in Part II - Item 8 included in our Annual Report. We consider the following policies to be our most critical accounting policies because they involve critical accounting estimates and a significant degree of management judgment:

•allowance for finance receivable losses; and

•TDR finance receivables.

There have been no material changes to our critical accounting policies or to our methodologies for deriving critical accounting estimates during the nine months ended September 30, 2022.

Recent Accounting Pronouncements

See Note 2 of the Notes to the Condensed Consolidated Financial Statements included in this report for discussion of recently issued accounting pronouncements.

Seasonality

Our personal loan volume is generally highest during the second and fourth quarters of the year, primarily due to marketing efforts and seasonality of demand. Demand for our personal loans is usually lower in January and February after the holiday season and as a result of tax refunds. Delinquencies on our personal loans are generally lower in the first and second quarters and tend to rise throughout the remainder of the year. These seasonal trends contribute to fluctuations in our operating results and cash needs throughout the year.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

There have been no material changes to our market risk previously disclosed in Part II - Item 7A included in our Annual Report.

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Item 4. Controls and Procedures.

CONTROLS AND PROCEDURES OF ONEMAIN HOLDINGS, INC.

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are designed to provide reasonable assurance that the information OMH is required to disclose in reports that OMH files or submits under the Exchange Act, is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including the Chief Executive Officer and the Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

As of September 30, 2022, OMH carried out an evaluation of the effectiveness of its disclosure controls and procedures, as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. This evaluation was conducted under the supervision of, and with the participation of OMH’s management, including the Chief Executive Officer and the Chief Financial Officer. Based on the evaluation, the Chief Executive Officer and the Chief Financial Officer concluded that OMH's disclosure controls and procedures were effective as of September 30, 2022 to provide the reasonable assurance described above.

Changes in Internal Control over Financial Reporting

There were no changes in OMH's internal control over financial reporting during the third quarter of 2022 that have materially affected, or are reasonably likely to materially affect, OMH's internal control over financial reporting.

CONTROLS AND PROCEDURES OF ONEMAIN FINANCE CORPORATION

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are designed to provide reasonable assurance that the information OMFC is required to disclose in reports that OMFC files or submits under the Exchange Act, is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including the Chief Executive Officer and the Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

As of September 30, 2022, OMFC carried out an evaluation of the effectiveness of its disclosure controls and procedures, as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. This evaluation was conducted under the supervision of, and with the participation of OMFC’s management, including the Chief Executive Officer and the Chief Financial Officer. Based on the evaluation, the Chief Executive Officer and the Chief Financial Officer concluded that OMFC's disclosure controls and procedures were effective as of September 30, 2022 to provide the reasonable assurance described above.

Changes in Internal Control over Financial Reporting

There were no changes in OMFC's internal control over financial reporting during the third quarter of 2022 that have materially affected, or are reasonably likely to materially affect, OMFC's internal control over financial reporting.

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PART II — OTHER INFORMATION

Item 1. Legal Proceedings.

See Note 12 of the Notes to the Condensed Consolidated Financial Statements included in this report.

Item 1A. Risk Factors.

In addition to the other information set forth in this report, you should consider the factors discussed in Part I - Item 1A. “Risk Factors” in our Annual Report, which could materially affect our business, financial condition, or future results.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

There were no unregistered sales of our common stock during the period covered by this Quarterly Report on Form 10-Q.

Issuer Purchases of Equity Securities

The following table presents information regarding repurchases of our common stock, excluding commissions and fees, during the quarter ended September 30, 2022, based on settlement date:

Period						Total Number of Shares Purchased						Average Price  paid per Share						Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (a)						Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs (a)
July 1 - July 31						101,704						$	39.33					101,704						$	820,597,781
August 1 - August 31						459,916						37.83						459,916						803,198,287
September 1 - September 30						618,813						33.94						618,813						782,198,612
Total						1,180,433						$	35.92					1,180,433

(a)    On February 2, 2022, the Board authorized a $1 billion stock repurchase program, excluding fees, commissions, and other expenses related to the repurchases. The authorization expires on December 31, 2024. The timing, number and share price of any additional shares repurchased will be determined by OMH based on its evaluation of market conditions and other factors and will be made in accordance with applicable securities laws in either the open market or in privately negotiated transactions. OMH is not obligated to purchase any shares under the program, which may be modified, suspended or discontinued at any time.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

None.

Item 5. Other Information.

None.

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Item 6. Exhibit Index.

Exhibit Number						Description
31.1						Rule 13a-14(a)/15d-14(a) Certifications of the President and Chief Executive Officer of OneMain Holdings, Inc.
31.2						Rule 13a-14(a)/15d-14(a) Certifications of the Executive Vice President and Chief Financial Officer of OneMain Holdings, Inc.
31.3						Rule 13a-14(a)/15d-14(a) Certifications of the President and Chief Executive Officer of OneMain Finance Corporation
31.4						Rule 13a-14(a)/15d-14(a) Certifications of the Executive Vice President and Chief Financial Officer of OneMain Finance Corporation
32.1						Section 1350 Certifications of OneMain Holdings, Inc.
32.2						Section 1350 Certifications of OneMain Finance Corporation
101						Interactive data files pursuant to Rule 405 of Regulation S-T, formatted in Inline XBRL:    (i) Condensed Consolidated Balance Sheets,    (ii) Condensed Consolidated Statements of Operations,    (iii) Condensed Consolidated Statements of Comprehensive Income,    (iv) Condensed Consolidated Statements of Shareholder’s Equity,    (v) Condensed Consolidated Statements of Cash Flows, and    (vi) Notes to the Condensed Consolidated Financial Statements.
104						Cover Page Interactive Data File in Inline XBRL format (Included in Exhibit 101).

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OMH Signature

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

ONEMAIN HOLDINGS, INC.

(Registrant)

Date:

October 28, 2022

By:

/s/ Micah R. Conrad

Micah R. Conrad

Executive Vice President and Chief Financial Officer

(Duly Authorized Officer and Principal Financial Officer)

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OMFC Signature

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

ONEMAIN FINANCE CORPORATION

(Registrant)

Date:

October 28, 2022

By:

/s/ Micah R. Conrad

Micah R. Conrad

Executive Vice President and Chief Financial Officer

(Duly Authorized Officer and Principal Financial Officer)

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