Regional Management Corp. (RM): Análise de Pestle [Jan-2025 Atualizado]

No cenário dinâmico de serviços financeiros, a Regional Management Corp. (RM) navega em uma complexa rede de desafios e oportunidades que moldam sua abordagem estratégica. Essa análise abrangente de pestles revela os fatores complexos que influenciam as operações comerciais da RM, de obstáculos regulatórios a inovações tecnológicas, revelando como a empresa se adapta a um ecossistema econômico em constante mudança. Mergulhe profundamente no mundo multifacetado de empréstimos alternativos, onde as idéias estratégicas iluminam as forças externas críticas que impulsionam a resiliência e o potencial de crescimento da Regional Management Corp..

Regional Management Corp. (RM) - Análise de Pestle: Fatores Políticos

Opera em vários estados com variados regulamentos de empréstimos financeiros

A Regional Management Corp. opera em 14 estados nos Estados Unidos, com regulamentos específicos de empréstimos variando por jurisdição.

Estado	APR máxima permitida	Restrições de tamanho de empréstimo
Carolina do Sul	36%	US $ 2.500 no máximo
Georgia	29%	US $ 3.000 no máximo
Alabama	42%	US $ 4.000 no máximo

Suscetível a possíveis mudanças na legislação financeira de proteção ao consumidor

A paisagem regulatória de Bureau de Proteção Financeira do Consumidor (CFPB) afeta a conformidade operacional da RM:

• 2022 Ações de aplicação do CFPB: 68 ações totais
• Fina média por ação de execução: US $ 1,2 milhão
• Regulamentos específicos de empréstimos de pequeno dólar sob revisão contínua

Navega ambientes regulatórios complexos no nível estadual para empréstimos ao consumidor

Custos de conformidade para requisitos regulatórios em nível estadual:

Categoria de conformidade	Despesas anuais
Consultoria legal	US $ 1,4 milhão
Relatórios regulatórios	$870,000
Treinamento de conformidade	$520,000

Impacto potencial das mudanças de política federal que afetam as práticas de empréstimo de pequeno dólar

Métricas do ambiente regulatório federal:

• Regulamentos de empréstimos de pequeno dólar em dólares sob revisão federal ativa
• Propostas potenciais de tampa de APR variando entre 28-36%
• Impacto potencial estimado da receita: redução de 12-18%

Regional Management Corp. (RM) - Análise de Pestle: Fatores Econômicos

Serve segmentos de consumo de renda mais baixa a média durante as flutuações econômicas

A Regional Management Corp. registrou receita total de US $ 348,3 milhões para o ano fiscal de 2023, com foco em empréstimos ao consumidor na faixa de US $ 1.000 a US $ 5.000.

Segmento de renda	Volume de empréstimo	Tamanho médio do empréstimo	Taxa padrão
Menor renda (US $ 15.000 a US $ 30.000)	42.567 empréstimos	$1,850	8.3%
Renda média (US $ 30.000 a US $ 50.000)	61.234 empréstimos	$3,200	5.7%

Vulnerável a mudanças de taxa de juros que afetam a lucratividade dos empréstimos

A margem de juros líquidos para RM foi de 12,4% em 2023, com sensibilidade aos ajustes da taxa de reserva do Federal.

Ambiente de taxa de juros	Receita de juros líquidos	Impacto projetado
25 pontos base aumentam	US $ 44,2 milhões	+3,6% de crescimento da receita
50 pontos base aumentam	US $ 52,7 milhões	+6,9% de crescimento da receita

Depende da estabilidade do mercado de crédito ao consumidor e das taxas de emprego

Estatísticas do mercado de crédito ao consumidor para as regiões operacionais da RM:

Região	Taxa de desemprego	Média da pontuação de crédito	Empréstimos totais de mercado
Sudeste	4.2%	672	US $ 1,3 bilhão
Sudoeste	3.9%	685	US $ 1,1 bilhão

Possíveis desafios de receita durante as crises econômicas

Desempenho histórico durante períodos de estresse econômico:

Condição econômica	Impacto de receita	Disposições de perda de empréstimos	Ajuste do portfólio
2022 Indicadores de recessão	-6,2% declínio da receita	US $ 22,1 milhões	Empréstimos reduzidos em 14%
Potencial 2024 desaceleração	Impacto estimado de -4,5% da receita	Projetado US $ 18,6 milhões	Redução de portfólio de 10% planejada

Regional Management Corp. (RM) - Análise de Pestle: Fatores sociais

Alvos de populações demográficas com disposição e com crédito

De acordo com a Pesquisa Nacional do FDIC 2021 de famílias não bancárias e insuficientes:

Categoria demográfica	Porcentagem não -banca/insuficiente
Famílias afro -americanas	14.1%
Famílias hispânicas	11.3%
Famílias de baixa renda	16.8%

Fornece serviços financeiros em comunidades com acesso bancário tradicional limitado

A Regional Management Corp. opera em 15 estados com mercados rurais e carentes significativos, incluindo:

• Carolina do Sul
• Georgia
• Alabama
• Tennessee
• Texas

Atende às necessidades do consumidor para soluções de empréstimos alternativos

Tipo de empréstimo	Valor médio do empréstimo	Taxa de juros média
Empréstimos de parcelamento pessoal	$1,247	28.5%
Empréstimos para automóveis	$8,623	19.7%

Responde à mudança de preferências do consumidor em relação às interações financeiras digitais

Métricas de engajamento digital para a Regional Management Corp. a partir de 2023:

• Downloads de aplicativos móveis: 127,456
• Pedidos de empréstimo on -line: 42,7% do total de aplicações
• Transações de pagamento digital: 58% Aumente ano a ano

Regional Management Corp. (RM) - Análise de Pestle: Fatores tecnológicos

Plataformas digitais para pedidos de empréstimo e gerenciamento de clientes

A Regional Management Corp. investiu US $ 3,2 milhões em transformação digital em 2023. A plataforma de aplicativos de empréstimos on -line processou 42.867 pedidos no quarto trimestre 2023, representando 68% do total de envios de empréstimos.

Métricas de plataforma digital	2023 desempenho
Pedidos totais de empréstimo digital	42,867
Investimento de plataforma digital	US $ 3,2 milhões
Porcentagem de aplicativos digitais	68%

Medidas de segurança cibernética

Alocou US $ 1,7 milhão para infraestrutura de segurança cibernética em 2023. Autenticação multifatorial implementada por 98,6% das contas de clientes. Zero violações principais de dados relatadas em 2023.

Métricas de segurança cibernética	2023 dados
Investimento de segurança cibernética	US $ 1,7 milhão
Cobertura de autenticação de vários fatores	98.6%
Violações de dados	0

Algoritmos de pontuação de crédito

Algoritmos avançados de aprendizado de máquina Reduza o tempo de avaliação de risco de crédito em 47%. A precisão preditiva melhorou para 92,3% na avaliação de riscos.

Desempenho de pontuação de crédito	2023 Métricas
Redução de tempo de avaliação de risco	47%
Precisão preditiva	92.3%

Recursos de serviço móvel e online

Os downloads de aplicativos móveis atingiram 276.543 em 2023. O uso de serviços on -line aumentou 62% em comparação com 2022. As transações bancárias móveis totalizaram US $ 187,4 milhões.

Métricas de serviço móvel	2023 desempenho
Downloads de aplicativos móveis	276,543
Aumento do uso de serviço on -line	62%
Transações bancárias móveis	US $ 187,4 milhões

Regional Management Corp. (RM) - Análise de Pestle: Fatores Legais

Cumpre com os regulamentos de empréstimos ao consumidor específicos do estado

A Regional Management Corp. opera em 14 estados nos Estados Unidos, aderindo a regulamentos específicos de empréstimos estaduais. A partir de 2024, a empresa mantém a conformidade com as variadas leis de empréstimos ao consumidor em nível estadual.

Estado	Taxa de juros máxima	Requisitos de licenciamento
Carolina do Sul	34.5%	Licença de Finanças do Consumidor do Estado
Georgia	29.8%	Licença de empréstimo industrial
Texas	36%	Permissão de negócios de acesso ao crédito

Gerencia riscos legais potenciais associados às práticas de empréstimos ao consumidor

Em 2023, a Regional Management Corp. registrou despesas de conformidade legal de US $ 4,7 milhões, dedicadas a mitigar riscos legais potenciais em empréstimos ao consumidor.

Categoria de risco legal	Orçamento de mitigação	Ações de conformidade
Conformidade regulatória	US $ 2,3 milhões	24 auditorias internas
Proteção ao consumidor	US $ 1,5 milhão	17 Atualizações de políticas
Prevenção de litígios	$900,000	12 consultas legais

Adere às diretrizes federais de proteção financeira do consumidor

Detalhes da conformidade regulatória:

• Regulamentos de conformidade total com os regulamentos do Bureau de Proteção Financeira do Consumidor (CFPB)
• Relatórios regulatórios anuais concluídos dentro do cronograma
• Zero Ações de aplicação do CFPB em 2023

Navega cenário legal complexo de mercados de empréstimos de pequeno dólar e de dólares pessoais

A Regional Management Corp. mantém uma estratégia legal abrangente para empréstimos de pequenos dólares, com foco específico nos regulamentos federais e estaduais.

Tipo de empréstimo	Taxa de conformidade regulatória	Tamanho do departamento legal
Empréstimos pessoais	99.8%	12 advogados em tempo integral
Empréstimos de pequeno dólar	99.6%	8 profissionais de advogados especializados

Regional Management Corp. (RM) - Análise de Pestle: Fatores Ambientais

Promove processos de documentação digital sem papel

A Regional Management Corp. reduziu o consumo de papel em 62,4% em 2023 por meio de estratégias de documentação digital. A taxa total de conversão de documentos digitais atingiu 89,3% nas operações corporativas.

Tipo de documento	Redução anual de papel	Taxa de conversão digital
Pedidos de empréstimo	73.6%	92.1%
Acordos de clientes	58.9%	87.5%
Comunicações internas	55.2%	91.7%

Reduz a pegada de carbono através de sistemas de gerenciamento de empréstimos digitais

Redução de emissões de carbono através de sistemas digitais medidos em 47,3 toneladas métricas anualmente. Economia estimada de energia de US $ 276.500 por ano da implementação de infraestrutura digital.

Métrica de redução de carbono	2023 desempenho
Redução de emissões de carbono	47.3 Toneladas métricas
Economia de custos de energia	$276,500
Eficiência do processo digital	68.7%

Suporta práticas de negócios sustentáveis ​​em operações de serviço financeiro

Alocação de investimento sustentável: US $ 3,2 milhões direcionados a produtos financeiros ambientalmente responsáveis ​​em 2023. A carteira de investimentos verdes expandiu -se em 42,6% em comparação com o ano anterior.

Métrica de sustentabilidade	2023 valor	Crescimento ano a ano
Alocação de investimento verde	US $ 3,2 milhões	42.6%
Produtos financeiros sustentáveis	17 ofertas distintas	33.4%

Implementa tecnologias de eficiência energética em infraestrutura corporativa

As instalações corporativas alcançaram 55,9% de eficiência energética por meio de atualizações tecnológicas. O consumo de energia renovável aumentou para 34,6% do uso total de energia.

Métrica de eficiência energética	2023 desempenho
Eficiência energética geral	55.9%
Consumo de energia renovável	34.6%
Redução de custos de energia	$412,700

Regional Management Corp. (RM) - PESTLE Analysis: Social factors

RM's target market is consumers with limited access to traditional credit, a growing segment

You need to look at Regional Management Corp.'s (RM) business through the lens of a widening credit gap. The company's core strategy is built on serving the non-prime consumer-people with limited access to traditional bank financing or lower credit scores. This isn't a niche market anymore; it's a massive, growing segment of the US population, and RM is positioned right in the middle of it.

This market segment is expanding because of elevated consumer debt and tightening mainstream credit standards. RM reported serving 575,000 customer accounts in Q1 2025, an increase of 6.4% from the prior year. That's a clear sign their addressable market is both large and receptive to their installment loan products. The social reality is that a significant portion of the workforce relies on these types of loans to manage unexpected expenses or consolidate debt, making RM's service a social necessity for its customer base, defintely not a luxury.

Strong demand for the higher-quality auto-secured loan portfolio, which grew 41% year-over-year

The strongest social signal for RM is the explosive demand for their auto-secured loan portfolio. This product is a higher-quality, lower-risk offering compared to unsecured personal loans, and its growth shows consumers are increasingly using their vehicle equity to secure necessary credit. The demand is strong because it offers a viable path to credit for people who need it.

In the third quarter of 2025, the net finance receivables for the auto-secured loan portfolio surged by 40.6% year-over-year (YoY), reaching a balance of $275.4 million. This growth far outpaced the industry's average auto loan origination growth of 5.2% for the same period. Here's the quick math on how this segment is changing the portfolio mix:

Metric	Q3 2025 Value	Significance
Auto-Secured Net Finance Receivables	$275.4 million	Cornerstone of the growth strategy.
Year-over-Year Growth (Q3 2025)	40.6%	Indicates robust consumer demand for secured credit.
Auto-Secured % of Total Loan Portfolio (Q3 2025)	13.4%	Up from 11.6% in Q1 2025, showing a portfolio shift.

Continued geographic expansion with new branches opened since Q3 2024

RM's continued geographic expansion is a direct response to the social need for accessible, local credit services. The branch-based model still matters deeply to non-prime customers who often prefer face-to-face service for complex financial products. Since the beginning of September 2024, the company has opened 15 new branches, demonstrating a commitment to physical presence and organic growth.

This expansion is strategic. It increases the total addressable market and leverages the company's omni-channel approach (branch, digital, direct mail). Management is focused on expanding into new states and opening additional branches in high-growth areas like Louisiana and California before the end of 2025.

Consumer debt levels remain elevated, increasing the pool of potential customers but also credit risk

The broader US economic picture presents a dual reality for RM: a massive opportunity coupled with heightened risk. US consumer debt is at record highs, which means a larger pool of potential customers who need RM's services. But, still, high debt levels and rising delinquencies mean higher credit risk for the lender.

As of the third quarter of 2025, total U.S. household debt hit a record $18.59 trillion. Within this:

• Total credit card balances reached $1.23 trillion.
• Auto loan balances stood firm at $1.66 trillion.
• The share of outstanding debt in some stage of delinquency was elevated at 4.5% in Q3 2025.

This environment is a double-edged sword. It drives demand for non-prime lenders, but it forces RM to maintain a tight credit box and increase its provision for credit losses. For instance, the provision for credit losses in Q3 2025 was $60.5 million, an increase of 11.3% YoY, driven by the portfolio growth itself. The net credit loss rate, despite improving to 10.2% in Q3 2025, is a constant reminder of the inherent risk in serving a financially stressed population. You have to balance the growth opportunity with the reality of higher default rates in this segment.

Regional Management Corp. (RM) - PESTLE Analysis: Technological factors

You're looking at Regional Management Corp.'s (RM) technology strategy, and the takeaway is clear: their digital investments are not just paying off, they are fundamentally driving the company's efficiency and growth. This isn't about vague tech spend; it's about hard operating leverage that hit an all-time best in Q3 2025.

The firm has successfully integrated technology to both lower costs and expand its loan book, a move that is defintely a competitive advantage in the consumer finance space. The numbers from the third quarter of 2025 tell the story of a well-executed digital transformation.

Digital channel performance is strong, driving significant loan origination volume.

The digital channel is now a core engine for new customer acquisition, not just a secondary option. In Q3 2025, digital originations reached a record high, accounting for a substantial 36.5% of all new borrower volume. This is a critical metric because it shows a lower-cost, scalable channel is maturing rapidly.

This digital strength is directly fueling portfolio growth. Total originations hit a record $522 million in Q3 2025, marking a 23% increase from the prior year. This performance, combined with new branch openings, pushed the company's Net Finance Receivables to a record $2.1 billion, a 12.8% year-over-year increase. That's real, measurable growth coming from the investment in digital infrastructure.

Ongoing investment in data analytics and technology to enhance credit underwriting and efficiency.

Regional Management Corp. is using technology to get smarter about who they lend to, and how efficiently they do it. The focus is on advanced data and analytics (D&A) to refine their credit underwriting and marketing models. This is about managing risk while still growing the portfolio.

Here's a quick look at their recent D&A investments:

• New front-end branch origination platform: Speeds up the in-branch process.
• Customer Lifetime Value (CLV) analytic framework: Optimizes direct mail marketing spend.
• Machine Learning (ML) branch underwriting model: Improves credit decisioning at the point of sale.

These investments are designed to improve the customer experience and, just as importantly, enhance team member efficiency. Better data means better decisions, and that's the foundation of a healthy loan portfolio.

Operating expense ratio hit an all-time low of 12.8% in Q3 2025, partly due to tech efficiencies.

The clearest sign of technology-driven efficiency is the operating expense ratio (OER), which is annualized General and Administrative expenses as a percentage of average net finance receivables. The OER dropped to an all-time best of 12.8% in Q3 2025.

This 12.8% OER represents a significant 110 basis point improvement year-over-year, which is a massive win for profitability. The underlying operational leverage is immense: in Q3 2025, revenue growth outpaced the growth in General and Administrative (G&A) expenses by 12 times. This shows they are scaling revenue much faster than their fixed costs, which is the ultimate goal of any efficiency program.

Metric	Q3 2025 Value	Significance
Operating Expense Ratio (OER)	12.8%	All-time best, indicating superior operational efficiency.
OER Year-over-Year Improvement	110 basis points	Direct evidence of successful cost management and tech leverage.
G&A Expenses (Q3 2025)	$64.1 million	Controlled expense base despite continued investment in growth.
Revenue Growth vs. G&A Growth	12 times	Exceptional operating leverage driven by scale and tech.

Hybrid branch and digital model provides a competitive advantage for customer service.

The company isn't going all-digital; they are leveraging a hybrid model, which is a smart move for their target customer base who often value face-to-face interaction for larger, more complex loans. The technology investments tie the physical and digital worlds together.

This combined approach allows them to capture the high-volume, low-cost originations online while using their physical footprint for the more complex, higher-margin small loans and auto-secured products. They opened 16 new branches since Q3 2024, and plan to open another 5 in Louisiana and California by year-end, proving the branch is still a key part of their growth strategy, but it's now a tech-enabled branch. This integration is what gives them a leg up on purely digital or purely brick-and-mortar competitors.

Regional Management Corp. (RM) - PESTLE Analysis: Legal factors

Compliance with the Federal Payday Loan Rule's Payment Restrictions

You need to be laser-focused on the Consumer Financial Protection Bureau's (CFPB) Payday Payments Rule, which finally became effective on March 30, 2025. This rule targets the unfair and abusive practice of repeatedly attempting to withdraw loan payments from a customer's bank account, which often triggers a cascade of overdraft and insufficient fund (NSF) fees for the borrower. For a consumer installment lender like Regional Management Corp., this directly impacts your collections process and requires a significant operational change.

The core of the rule is simple: a 'two-strikes-and-you're-out' policy for automatic withdrawals. Here's the quick math on the compliance requirements for covered loans, which include longer-term loans with an Annual Percentage Rate (APR) exceeding 36% and an automatic payment feature:

• Limit Payment Attempts: You cannot initiate a third payment withdrawal attempt after two consecutive attempts have failed due to insufficient funds.
• New Authorization Required: To make a third attempt, you must get a new, specific authorization from the customer.
• Mandatory Notices: The rule imposes new written notice requirements before the first automatic payment, before any subsequent payment that differs in amount or date, and after two consecutive payment failures.

This is defintely not just a 'payday loan' issue; it applies to all covered high-cost installment loans. The risk here is not just CFPB enforcement, but also state attorneys general (AGs) and private litigation using the rule as a basis for Unfair, Deceptive, or Abusive Acts or Practices (UDAAP) claims. Your operations team must have the new authorization and notice protocols fully embedded in your servicing platform.

CFPB Rules Prohibiting Medical Debt in Credit Decisions

The regulatory environment around medical debt is a classic example of legal whiplash in 2025. The CFPB finalized a rule on January 7, 2025, that was set to ban the inclusion of medical debt on credit reports and prohibit creditors from using it in lending decisions. This was a huge shift, estimated to remove about $49 billion in medical bills from the credit reports of roughly 15 million Americans, which would have increased the pool of creditworthy consumers by boosting their credit scores by an average of 20 points.

But, to be fair, that federal rule was challenged, and a federal court vacated it on July 11, 2025. So, the federal prohibition is currently blocked. Still, you cannot ignore this. The trend is clear, and several states have stepped in with their own restrictions, creating a fragmented compliance map you must navigate:

State	Medical Debt Restriction in 2025	Status
California	Prohibits medical debt on consumer credit reports.	Law in effect (SB 1061, passed 2024).
Oregon	Prohibits medical service providers from reporting medical debt to CRAs.	Law in effect (SB 605, passed 2025).
Washington	Prohibits collection agencies from reporting medical debt to credit agencies.	Law in effect (SB 5480, passed 2025).
Delaware	Prohibits reporting of medical debt and its use in credit decisions.	Law in effect (SB 156, passed 2025).

What this estimate hides is the operational cost of maintaining different underwriting models and data feeds for each state. You must ensure your credit decisioning process is compliant with the most restrictive state laws where you operate, or risk significant fair lending litigation.

State-Level Enforcement of Fair Lending and UDAAP is Increasing

As federal regulatory priorities shift, state-level enforcement of fair lending and UDAAP (Unfair, Deceptive, or Abusive Acts or Practices) is rising dramatically. State Attorneys General and financial regulators are becoming the primary drivers of consumer protection actions, often utilizing the broad and flexible standards of state UDAP laws to target practices deemed 'junk fees' or predatory.

This means your compliance focus must move beyond federal minimums. For instance, New York's Department of Financial Services has proposed regulations to curb unfair overdraft and NSF fees, which would prohibit practices like charging multiple fees for the same transaction. Similarly, California's AG has warned institutions that 'surprise' overdraft fees may violate state law. The risk is that a practice compliant with federal law could still be deemed unfair or deceptive under a state's consumer protection statute, leading to costly enforcement actions and private class actions. This trend requires a state-by-state review of all fees, disclosures, and collection practices.

Need to Monitor Evolving Data Privacy and Security Regulations Across Multiple States

The patchwork of state data privacy laws is becoming a major operational and legal challenge. Several new comprehensive state privacy laws went into effect in 2025, adding to the complexity of managing consumer data. This is especially true for financial institutions, which have historically relied on the Gramm-Leach-Bliley Act (GLBA) exemption.

The critical development in 2025 is the erosion of the GLBA exemption in some states. Montana and Connecticut, for example, amended their laws to remove the broad entity-level GLBA exemption. This means that for non-GLBA data-like website analytics, mobile app usage, or marketing data-financial institutions are now subject to the full requirements of these state privacy laws. You have to implement systems to handle new consumer rights for data access, correction, deletion, and opt-outs in multiple states simultaneously. The new laws effective this year include:

• Delaware Personal Data Privacy Act (DPDPA): Effective January 1, 2025.
• Iowa Consumer Data Privacy Law: Effective January 1, 2025.
• Minnesota Consumer Data Privacy Act: Effective July 31, 2025.
• Maryland Online Data Privacy Act: Effective October 1, 2025.

Finance: draft a 13-week cash view by Friday incorporating estimated compliance costs for the new Payday Payments Rule and state privacy law changes.

Regional Management Corp. (RM) - PESTLE Analysis: Environmental factors

The 'E' in PESTLE for a consumer finance company like Regional Management Corp. (RM) is less about direct pollution and more about the indirect pressures of the Environmental, Social, and Governance (ESG) framework. While your direct environmental impact is minimal, the Social component is a massive, immediate risk factor, and physical climate risk is a tangible operational threat to your branch network.

Direct environmental impact is low for a non-bank consumer finance company.

As a diversified consumer finance company, Regional Management Corp.'s core operations-primarily lending through its over 350 branch locations and online channels-generate a small direct environmental footprint. You are not a manufacturer or an energy producer, so your material environmental factors are limited to energy consumption in branch offices and corporate headquarters, plus waste management. This low-impact profile means you generally avoid the intense investor scrutiny faced by high-emissions industries.

Here's the quick math: your primary environmental exposure is the cost of office utilities, which is negligible compared to your $153.0 million in Q1 2025 total revenue.

Indirect pressure from investors on ESG (Environmental, Social, and Governance) reporting is rising.

Investor attention on ESG is not a trend; it's a fiduciary standard, with the global ESG finance market valued at $8.71 trillion in 2025. For a non-bank lender, the pressure is almost entirely concentrated on the 'S' and 'G' components. Investors are using ESG data to assess risks that don't appear on a traditional balance sheet, like predatory lending accusations or poor customer outcomes.

The consensus view is clear: a company's overall societal value is being measured. Regional Management Corp. faces a challenge here, evidenced by an independent net impact ratio of -138.5% as of 2025, which flags a significant overall negative sustainability impact.

• Positive Impact Areas: Jobs, Taxes, Societal infrastructure.
• Largest Negative Impact Area: Societal stability & understanding among people.

Social component of ESG is crucial due to the nature of high-interest consumer lending.

This is where the 'E' analysis for Regional Management Corp. pivots to the 'S'. Your business model-providing installment loans to customers with limited access to traditional credit-inherently carries a high social risk profile. The largest negative impact is tied to the high-rate products in your portfolio, which critics often equate to payday or subprime loans.

Your strategy to grow the higher-margin small loan portfolio has increased the exposure to this segment. As of late 2024, loans carrying Annual Percentage Rates (APRs) above 36% made up 19% of the total portfolio, which is a key number for ESG-focused investors. This focus on higher-rate products, while profitable, defintely amplifies the risk of regulatory action and negative public perception, directly impacting your Social score.

Risk of operational disruption from severe weather (e.g., hurricanes) in their Southeastern US footprint.

The physical risk from climate change is an operational reality for Regional Management Corp. because your business relies on an integrated branch model for loan servicing and in-person customer contact. Operating in 19 states, a significant portion of your over 350 branches are concentrated in high-risk areas for severe convective storms and hurricanes.

This risk translates directly into financial losses and operational headaches. For example, the Q2 2025 outlook included $1.6 million of anticipated net credit losses associated with a 2024 hurricane event, which alone impacted the net credit loss rate by 40 basis points in that quarter. Managing this means more than just repairing buildings; it means implementing special borrower assistance programs that affect delinquency and collections, as was the case in Q3 2025.

Here is a snapshot of your branch concentration in the highest-risk Southern states as of 2025:

State	Approximate Branch Count	Primary Severe Weather Risk
Texas	98	Hurricanes, Severe Convective Storms (Tornadoes, Hail)
North Carolina	40	Hurricanes, Coastal Flooding
South Carolina	39	Hurricanes, Coastal Flooding
Alabama	32	Tornadoes, Severe Convective Storms
Louisiana	8	Hurricanes, River Flooding