Rob Wildhack: Hi, guys. Just one more on the funding market. Given your origination growth and the better spreads now, why not tap the ABS market yourselves?
Doug Busk: Well, we certainly intend to. But at the end of the year, we had about $1.6 billion in unused availability at our committed revolving credit facilities. So a very strong liquidity position. But I mean that’s something we’ll do at the appropriate time.
Rob Wildhack: Okay. So safe to assume and to tie it back to New York State, there’s nothing in that lawsuit that would preclude you from continuing to tap the ABS market, right?
Doug Busk: Correct. The complaints a complaint, but there’s nothing in there that would prohibit us from accessing the securitization market.
Rob Wildhack: Got it. And then to switch over. In the press release, you called out forecasted profitability on a few different vintages. Can you define that for us? And then I’m kind of wondering why forecasted profitability for the ’22 vintage would be significantly lower, but the forecasted collections are only like 1 percentage point lower than initial.
Doug Busk: Yeah. I mean forecast and profitability, the way we’re defining it there is really forecasted economic profit. The non-GAAP financial measure we referred to in the press release. Relative to 2022, it just were — it was a pretty low standard for significantly. It’s basically a tenth of the percent in the collection rate which is it’s arguable whether that’s significant or not, but that’s the standard we’ve chosen to use. I’m sorry, 1%.
Rob Wildhack: Okay. So 1% on collections is significantly lower in ’22. Okay. Got it. And then one more. On past calls, you’ve said that when you’re growing originations, you probably buy back less stock. This quarter, you were able to kind of do both. What’s going on there? And how should we think about share repurchases if you do continue to grow in ’23?
Doug Busk: As we’ve said before, the first priority is always to make sure we have the capital that we need to fund anticipated levels and originations. So that’s going to be the first priority. In terms of share repurchases, I think it just depends on how the capital markets function, what our growth rates are and things like that. But the first priority will always be the funds to levels of loan originations.
Rob Wildhack: Okay. Thank you.
Operator: Thank you. One moment while we prepare for the next question. Our next question is coming from John Hecht of Jefferies. Your line is open.
John Hecht: Good afternoon, guys. Thanks for taking my questions. You touched on earlier with a set of questions about the last three quarters, write-downs in cash flows. I’m just wondering, what do you — like do you guys think about an attribution for that? I mean, is it tied to structural factors on the loans recently? Is it tied to inflation? Is it because asset values are declining? Do you have a sense for the causation of that over the recent quarters?
Doug Busk: It’s tough to say precisely, but I think it’s likely primarily the impact of inflation on a subprime consumer and then declining vehicle values for the last six, seven, eight months.
John Hecht: And then, I mean, I don’t know if you’re willing to do this. But I mean, obviously, you guys are probably in communications with your dealer partners all the time on your comments about inventory levels and purchase kind of volumes. Is it your perspective that kind of the worst is behind the dealers, meaning that this system is starting to stabilize or do you guys think there’s more to come in terms of reduction of demand and reduction in part prices? How do you think about the what’s your kind of forward perspective?
