Indirect Loan analysis by HACKERS Leon Savvas Michael Theriot Dasha Priklonskaya Date: May 2, 2000

30 day Delinquency Distribution in $

Relative 30 Day Delinquency

60 day Delinquency Distribution in $

Relative 60 Day Delinquency

90 day Delinquency Distribution in $

Relative 90 Day Delinquency

Bottom Line B tier is clearly the most delinquent: At least 60% of 30, 60, and 90 day delinquency comes from the B customers At least 60% of $ delinquency for B customers is a 30 day delinquency On the delinquency graphs B curve is always higher than A curve

New Loan Origination

Prepayment

Profit

Cumulative Charge-offs

Bottom Line At least 60% of New Loan Origination, Prepayment and Profit come form A customers Both A and B customers tend to pay off their loans. However, most of the charge off volume come from the B customers. Asymptotically B customers charge offs are 3 times higher than A customers charge offs

Charge-offs

Bottom Line B and A customers have a similar charge off pattern, but on different scales B customers have greater charge off rate than A customers

Conclusion Most of the delinquency and charge off volume can be explained by A and B customers A and B have similar patterns. However, numerically B always underperforms A Need to review B tier policies B tier has good Cash Flows B tier is less reliable