美聯(lián)儲-2020年金融公司調(diào)查2020 Survey of Finance Companies

FinanceandEconomicsDiscussionSeries

FederalReserveBoard,Washington,D.C.

ISSN1936-2854(Print)

ISSN2767-3898(Online)

2020SurveyofFinanceCompanies

RobertAdams,LisaChen,MichaelChernousov

2024-064

Pleasecitethispaperas:

Adams,Robert,LisaChen,andMichaelChernousov(2024).“2020SurveyofFinanceCompanies,”FinanceandEconomicsDiscussionSeries2024-064.Washington:BoardofGovernorsoftheFederalReserveSystem,

/10.17016/FEDS.2024.064

.

NOTE:StafworkingpapersintheFinanceandEconomicsDiscussionSeries(FEDS)arepreliminarymaterialscirculatedtostimulatediscussionandcriticalcomment.TheanalysisandconclusionssetfortharethoseoftheauthorsanddonotindicateconcurrencebyothermembersoftheresearchstafortheBoardofGovernors.ReferencesinpublicationstotheFinanceandEconomicsDiscussionSeries(otherthanacknowledgement)shouldbeclearedwiththeauthor(s)toprotectthetentativecharacterofthesepapers.

1

2020SurveyofFinanceCompanies1

RobertAdams,LisaChen,MichaelChernousov

Introduction

Financecompaniesrepresentanimportantsourceofdebtandleasefinancingtoconsumers

andbusinesses.Financecompaniesarethesecond-largestcategoryofprivatesuppliersof

credit,behinddepositoryinstitutions(banks,thrifts,andcreditunions).Financecompanies

focusprimarilyoncollateralizedloanssuchasauto,equipment,andrealestateloansforbothconsumersandbusinesses.Inparticular,financecompaniesaccountforasignificantshareofconsumermotorvehicleloanandleasefinancing.Inaddition,whiletheyholdonlyamodest

shareofmortgagecreditintheirportfolio,financecompaniesaccountforasignificantshareofresidentialmortgageoriginations.Finally,theirportfoliostobusinessesincludecreditand

leasestofinanceinventory(includingcardealers),accountsreceivable,andtheacquisitionofmotorvehiclesandequipment.

Financecompaniesaredefinedasthecompaniesinwhich50percentormoreofassetsare

heldinanyofthefollowingtypesofloansorleases:(1)liensonrealestate(realestateloans);(2)loansandleasestosoleproprietorships,partnerships,corporations,andotherbusiness

enterprises(businessloans);and(3)loansandleasestohouseholdsthatarenotcollateralizedbyrealestate(consumerloans).Notethat,accordingtothisdefinition,financecompaniesdonotincludecommercialbanks,cooperativebanks,creditunions,investmentbanks,savings

banks,savingsandloaninstitutions,andindustrialloancorporations.Nordotheyinclude

subsidiariesofthesetypesofcompanies.However,subsidiariesofabankholdingcompany,

savingsandloanholdingcompany,orforeignbankingorganizationmaybeconsideredfinancecompaniesiftheysatisfytheabovecriteria.

1Wededicatethisarticletothepreviousauthor,GregoryElliehausen,whopassedawayin2023.Gregwasan

outstandingcolleague,whoseknowledgeonconsumerfinancewasunsurpassed.Gregissorelymissed.Wewouldalsoliketothankthefollowingpeoplefortheircontributionstotheproject:BrendanBarry,MichaelBlume,

HannahCase,DanCrouthamel,HeatherDerbyshire,JessicaFlagg,MelissaJohnson,BradleyKatcher,SusanKelleher,MelissaKinney,HajaSannoh,AdamSteinberg,RichWood,andChristinaYoung.

2

Overall,financecompaniesdifferfromdepositoryinstitutionsinthattheyonlyfocusonlendinganddonotprovidedeposit-relatedorancillaryservices.Asaresult,financecompaniesdonothavedepositsasasourceoffundingandtypicallyrelyonotherformsoffundingsuchasnotes,bonds,debentures,andnonrecoursedebt.

TheFederalReserveproducesdataonthevolumeandcompositionofcreditandlease

financingprovidedbythefinancecompanyindustryandreportsthesedatainthefollowing

statisticalreleases:G.19,“ConsumerCredit”;G.20,“FinanceCompanies”;andZ.1,“FinancialAccountsoftheUnitedStates.”2TheG.19,“ConsumerCredit,”releasemeasuresconsumer

debtheldbydifferenttypesoflenders.Consumercreditconsistsofalltypesofcreditthatareusedbyindividualsandthatarenotcollateralizedbyrealestateorbyspecificfinancialassets(suchasstocksandbonds)orusedforbusinesspurposes.TheG.20,“FinanceCompanies,”

releaseanalyzesconsumer,realestate,andbusinessreceivablesownedandmanagedby

financecompanies.TheG.20releaseandpartoftheG.19releaseareestimatedonamonthlybasisusingadditionalsurveydatafromasmallsampleoffinancecompanies.Dataonassetsandliabilitiesoffinancecompanies,includingallreceivablesheld,arepublishedintheZ.1,

“FinancialAccountsoftheUnitedStates,”releaseonaquarterlybasis.

Tomaintainthequalityofitsstatistics,theFederalReserveconductstheCensusofFinance

CompaniesandOtherLendersandtheSurveyofFinanceCompanieseveryfiveyears(theso-calledquinquennialsurvey).Datafromthequinquennialsurveyareusedtobenchmarkthe

estimatesintheG.19,G.20,andZ.1releases.Thisarticlereportsdevelopmentsinthefinancecompanyindustryusingdatafromthemostrecentsurveyin2021.3Inadditiontobalance

sheetinformationusedtobenchmarkstatisticalreleases,thesurveyincludesquestionsonrespondentincomestatementsthatwereintroducedin2015andrepeatedinthe2021

2TheFederalReserveStatisticalReleaseG.19,“ConsumerCredit,”isavailableontheBoard’swebsiteat

/releases/g19/current/default.htm

.TheG.20,“FinanceCompanies,”releaseisavailableat

/releases/g20/current/default.htm

.TheZ.1,“FinancialAccountsoftheUnitedStates,”releaseisavailableat

/releases/z1/

current/default.htm.

3Asnotedintheappendix,whilethesurveybeganin2020,datacollectionwasnotcompleteduntil2021becauseofCOVID-19.

3

quinquennialsurvey.Ouranalysisofthissurveydataalsoincludesinformationfromasupplementalquestiononthenumberofoffices.

Thisquinquennialsurveyisatwo-stagesurvey.First,weconductacensusofalllikely

companiesthatprovidefinancingtoindividualsandbusinesses.Second,asurveyisconductedofthosecompaniesinthiscensusthatmeetthedefinitionofafinancecompany.

Besidesthisvoluntarysurvey,dataweresupplementedfromdifferentsources.First,dataweresourcedfromregulatoryfilings,especiallyfrompubliclytradedfinancecompanies.Second,

dataforrealestatefinancecompanieswereincludedfromtheMortgageCallReportfromtheConferenceofStateBankSupervisors(CSBS).Furtherdetailsonthemethodologyareprovidedintheappendix.

Summary

Overall,lendingbyfinancecompaniesexpandedatafastclipfrom2015to2021,withloansandleasesincreasing41percentandtotalassetsgrowing35percent.

Thefollowinglisthighlightsseveralprominentfindingsfromouranalysis:

.In2021,financecompaniesheldover$2.2trillioninassetsand$1.8trillioninloansand

leases.

.Overall,totalassetsoffinancecompanieswereup35percentin2021relativeto2015.Increaseswerebroadbasedacrossmultiplelendingcategories,withexceptionalgrowthinrealestatefinancing.Assetsinrealestatefinancinggrew128percentfrom2015to

2021,butconsumerandbusinessfinancecompanyassetsalsoshowedstronggrowth,withbothgrowingatalmost30percentfrom2015to2021.

.Thefinancecompanyindustryishighlyconcentrated,withfewlargefirmsaccountingforamajorityofassets,despiteincreasesinindustryassets.

.Consumerloansandleasesaccountedforover50percentoftotalfinancecompany

receivablesin2021,whilerealestateandbusinesslendingaccountedfortherest.Over

90percentoffinancecompanyfinancingissecured.

4

.Firmsintheindustryarehighlyspecialized.Nearlyallfinancecompaniesheldamajorityoftheirassetsinonetypeofcredit—consumer,realestate,orbusinesscredit.

.Aboutone-halfofconsumerlenders’assetsconsistedofmotorvehicleloansandleases,

butconsumerlendersalsoheldaconsiderableshareofassetsinother(nonvehicle)closed-endconsumercreditandsomerealestate.

.Byfar,mostrealestatelenders’assetsweremortgagesonone-tofour-familyhomes,

withmultifamilyorothercommercialmortgagesconstitutingthesmallremainingshare.Furthermore,overhalfofbusinesslenders’assetsconsistedofequipmentloansand

leases.Businesslendersalsoprovidedbusinessmotorvehicle–relatedfinancing,butthatfinancingaccountedforonlyarelativelysmallshareofassets.

.Financechargesamongtheconsumer,realestate,andbusinesslendersvaried

significantlyin2021,asin2015.Despitelargedifferencesinrevenueandexpenses,theoperatingreturnonassets(ameasureoftheefficiencyofgeneratingincomefrom

assets)wasaboutthesameforthethreetypesoflenders,thoughdownsomewhatin2021.

1.RecentDevelopments:IndustryStructure

Overall,concentrationinthefinancecompanyindustryremainedhighandlargelyunchanged.Asinthebankingindustry,therearealargenumberofsmallfinancecompanies,butmostofthefinancecompanyindustryassetsareheldbyafewlargefirms.Thevastmajority—79

percent—offinancecompanieshaveassetsoflessthan$10million,virtuallyunchangedsince2010(table1).Thesefirmsheldaverysmallshareofaggregateassetsin2021(about1

percent).Bycontrast,lessthan5percentoffinancecompanieshavemorethan$1billioninassets.However,thesecompaniesaccountedforover90percentofassetsintheindustry,unchangedatleastsince2005.4

4Table1wasnotproducedinthe2000FederalReserveBulletinarticle.

5

1.Percentagedistributionoffinancecompanies,bynumberoffirmsandassetsize:2010,2015,and2021

NumberoffirmsAggregateassets

(percent)

(percent)

Assetsize(dollars)

2010

2015

2021

2010

2015

2021

Lessthan1million

44

52

38

1

<.5

<.1

1–10million

25

30

41

<.5

1

1

10–100million

24

12

12

3

2

1

100million–1billion

5

5

5

4

5

5

1–20billion

2

1

3

18

21

42

20billionorgreater

<.5

<.5

<.5

74

71

51

Total

100

100

100

100

100

100

Note:Componentsmaynotsumtototalsbecauseofrounding.Source:FederalReserveBoard,SurveyofFinanceCompanies.

Thechangesacrossassetgroupsvariedlittlesince2005,andtheoverallstructureofthefinanceindustryremainedstableoverthepast20years.Thepercentageoffirmsinthesmallestthreeassetsizegroupsdeclinedslightlyto91percentfrom94percentin2015(and93percentin

2010)butremainedabovethe2005levelof86percent.Asaresult,thepercentageoffirmsinthelargestthreecategoriesincreasedslightly.

Thepercentageoftotalassetsforfinancecompaniesinthetoptwocategorieshasnotchangedsignificantlysince2010.However,financecompanieswithassetsover$20billionfellto51

percentin2021,andfinancecompanieswithassetsof$1billionto$20billionincreased.Thesechangesweremainlytheresultofseverallargefinancecompaniesleavingtheuniverseof

financecompanies(forexample,throughobtainingabankcharterorbecomingasubsidiaryofabank).

Finally,the2020surveyincludedaquestiononthenumberofofficesforeachfinance

company.Overhalfoftherespondingfinancecompanieshaveasingleoffice,aligningwiththeassetsizedistributionoffinancecompanies,asmanyareverysmall.Bycontrast,manylarger

6

financecompanieshavesignificantofficenetworks.Twelveofthe20financecompanieswithmorethan$20billioninassetshavemorethan100offices.Infact,25percenthave5officesormore,10percenthave26ormoreoffices,and1percenthavemorethan490offices.In

anotherperspective,mostfinancecompanieswithmorethan$100millioninassetshavemorethanfiveoffices.Theexistenceoflargefinancecompanieswithextensiveofficenetworks

impliesthatsomeloanproductsmayprofitfromlocalpresence.

Somelargefinancecompaniesdonotpossessextensiveofficenetworks,andtheyengagein

lendingandconnectwithborrowersthroughtheirbusinesspartners.Notably,mostcaptive

financecompaniesreportedthattheyhaveasingleoffice.Forsuchlenders,dealershipsarethemainpointofcontactforloanorigination.

1.1FinanceCompanyBalanceSheets

Table2showsthevalueoffinancecompanyreceivablesbyloantype.Thetotalvalueoffinancecompanyreceivablesincreasedto$1.8trillionin2021,a41percentincreasefromitslevelof

$1.3trillionin2015.Consumerlending,especiallyconsumermotorvehiclefinancing,

representsthelargestshareofreceivablesatabout$950billion,over50percentofthetotal,whilebusinessandrealestatereceivablesrepresentjustabout28percentand20percentoftotalreceivables,with$518billionand$363billioninreceivables,respectively.

Since2015,consumerandbusinesslendingexpandedatasimilarrate,withconsumer

receivablesrising$211billion,a29percentincrease,andbusinessreceivablesrising$113

billion,a28percentincrease.Meanwhile,realestatereceivablesincreasedto$363billion,a128percentincreasesince2015.

7

2.Loanandleasereceivables,bytype:2010,2015,and2021

Level(billionsofdollars)Percentchange

Shareoftotal

assets

(percent)

2010–

2015–

Assetcategory

2010

2015

2021

2015

2021

2010

2015

2021

Consumer

820

738

949

-10

29

44

44

42

Motorvehicleloans

277

303

444

9

47

15

18

20

Motorvehicleleases

112

176

251

57

43

6

11

11

Revolving

85

26

29

-69

12

5

2

1

Other

346

233

225

-33

-3

19

14

10

Realestate

244

159

363

-35

128

13

10

16

1–4family

170

123

321

-28

161

9

7

14

Other

74

36

42

-51

17

4

2

2

Business

408

405

518

-1

28

22

24

23

Motorvehicles

117

104

92

-11

-12

6

6

4

Retailloans

18

15

27

-17

80

1

1

1

Wholesaleloans

69

80

54

16

-33

4

5

2

Leases

30

9

11

-70

22

2

1

0

Equipment

204

219

289

7

32

11

13

13

Loans

118

122

137

3

12

6

7

6

Leases

86

97

152

13

57

5

6

7

Otherbusinessreceivables

86

82

138

-5

68

5

5

6

Totalloansandleases

1,472

1,302

1,831

-12

41

79

78

81

Memo:Totalassets

1,875

1,680

2,273

-10

35

100

100

100

Note:Componentsmaynotsumtototalsbecauseofrounding.

Source:FederalReserveBoard,SurveyofFinanceCompanies.

1.1.ConsumerLending

Astable2indicates,consumermotorvehiclefinancingrepresentsthelargestportionof

consumerlending.Thisfinancingincludesloansandleasesoriginatedbylargecaptivefinance

8

companiesownedbymotorvehiclemanufacturers,aswellascreditheldbyindependent

financialcompaniesanddealer-originatedlending(“BuyHere,PayHere”loans).Independentfinancecompaniesanddealer-originatedlendingfocusontheusedcarmarketandmainly

extendcredittoborrowerswithlowercreditscores.

In2021,financecompaniesheld$695billioninmotorvehiclefinancing,ofwhich$444billion(64percent)wascreditfinancingand$251billion(36percent)wasleasefinancing.Overall,consumermotorvehiclefinancingincreased45percentsince2015.

Otherconsumercreditisanotherlargecomponentofconsumerfinancingprovidedbyfinancecompanies.Thiscategoryconsistsmainlyofclosed-endsalescreditforother(nonvehicle)

consumergoods,cashloans,andstudentloans.Financecompaniesheld$225billionofsuch

creditin2021,accountingfor10percentofindustryassetsanddeclining3percentsince2015.5Finally,theindustryalsoheldabout$29billionofrevolvingconsumercredit,whichwasjust1

percentofindustryassets.6

1.2.RealEstateLending

Financecompaniesfocusmainlyonone-tofour-familyproperties,accountingforalmost90percentofrealestatefinancecompanyreceivables.Asnoted,realestateloansgrew

significantlyfrom2015to2021.Thisgrowth,inpart,reflectstherefinanceandhousepurchaseboomsinmortgagemarketsduringthefirstyearoftheCOVID-19pandemic.

Mortgageoriginationsbyfinancecompaniesoftenfollowamultistageprocess.7Inthefirst

stage,thefinancecompanyoriginatestheloanandfundsitusingalineofcreditprovidedbya

5In2021,respondentstothesurveyreportedstudentloanbalancesseparately.Financecompaniesheld

approximately$131.5billioninstudentloans,morethanhalfofotherconsumerlending.Moststudentloan

balanceswereheldbyasmallnumberoffinancecompanies.Forcomparabilitytoprevioussurveys,weincludestudentloansintheotherconsumerloancategory.

6Historically,financecompaniesheldasignificantshareofcreditcarddebt;however,theirsharehasdwindledinrecentyears.

7Foradetaileddescription,seeYouSukKim,StevenM.Laufer,KarenPence,RichardStanton,andNancyWallace

(2018),“LiquidityCrisesintheMortgageMarket,”FinanceandEconomicsDiscussionSeries2018-061

(Washington:BoardofGovernorsoftheFederalReserveSystem,March;revisedJune2018),

/10.17016/FEDS.2018.016r1

.

9

warehouselender.8Inthenextstage,theloanissoldtoaninvestor,primarilygovernment-

sponsoredenterprisessuchasFannieMaeandFreddieMac.Subsequently,thedrawonthe

warehouselineispaidoff,andthefinancecompanyearnstheoriginationfees.Asaresult,the

financecompanycanoriginateanewloan.Themethodoforiginationallowsfinancecompaniestodramaticallyincreasemortgageoriginations.

1.3.BusinessLending

Financecompaniesalsoheldasignificantamountofbusinessloansin2021,themajorityof

whichwasequipmentfinancingat$289billion.Businessequipmentfinancingincludesloansandleasesfordiverseequipmentsuchasconstructionequipment,aircraft,farmequipment,

railwaycars,computers,andofficeequipment.Leasescanbeclassifiedaseithercapitalleasesoroperatingleases.Capitalleasesextendovermostoftheeconomiclifeoftheassetandarenotcancelablebythelesseewithoutpenalty,whereasoperatingleasesareshorttermandarecancelableatthediscretionofthelessee.In2021,27percentofbusinessequipmentleases

werecapitalleases,and73percentwereoperatingleases(notshown).

Motorvehiclefinancingtobusinessesaccountedforasizable,thoughdeclining,portionofoverallbusinesslending.Between2015and2021,motorvehicleloanstobusinesses

contracted12percentto$92billion,drivenbya33percentdeclineto$54billionin2021in

wholesaleloansfinancingdealerinventoriesofcommercialandlightmotorvehiclesforsale.Bycontrast,retailbusinessmotorvehicleloansincreased80percentto$27billion,whileleases

increased22percentto$11billionovertheperiod.

1.4.FinanceCompanyFunding

From2015through2021,financecompaniesreliedheavilyonnonrecoursedebtassociatedwithstructuredfinancingactivitiesandnotes,bonds,anddebenturestofundtheirlendingactivities(table3).Together,thesetypesoffundingtotaledover$1trillion(orabout47

percentoftotalassets).Financecompaniesbecamelessreliantoncommercialpaperfor

funding,whichhasdecreasedfrom5percentoftotalliabilitiestoamere3percentin2021.By

8Mortgagebrokersarenotincludedinthescopeoffinancecompanies.

10

contrast,financecompaniesbecamemorereliantonbankloans,whichnowrepresent12

percentoftotalliabilitiesin2021,anincreasefrom5percentin2010.Finally,equitycapital,ornetworth,isanothersourceoffunding.Togetherwithotherliabilities,capitalprovidesabout30percentoffunding,upfrom25percentin2015.

3.Liabilitiesandnetworthoffinancecompanies:2010,2015,and2021

Level(billionsof

Liabilitycategoryornetworth

CommercialpaperBankloans

Notes,bonds,debentures,andotherdebtDebtduetoparentcompany

OtherliabilitiesTotalliabilities

Networth

Totalliabilitiesandnetworth

2010

99

92

1,078

181

192

1,642

233

1,875

dollars)

2015

67

156

890

157

190

1,460

220

1,680

2021

57

271

1,074

167

319

1,888

384

2,273

Percentchange

2010–2015–

20152021

-32-15

7074

-1721

-136

-168

-1129

-675

-1035

Shareoftotal

assets

(percent)

201020152021

543

5912

575347

1097

101114

888783

121317

100100100

Note:Componentsmaynotsumtototalsbecauseofrounding.

Source:FederalReserveBoard,SurveyofFinanceCompanies.

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1.5.ACloserLookatSpecializedTypesofFinanceCompanies

Whiletheindustryasawholeprovidesawiderangeofproducts,thevastmajorityoffinancecompaniesfocusinonespecializedtypeoflending.Wedefinespecializationashaving50

percentormoreofassetsinconsumer,realestate,orbusinessloansandleases.9In2021,53percentoffinancecompanieswereconsumerlendingspecialists,34percentwererealestatelendingspecialists,and11percentwerebusinesslendingspecialists.

Overall,specialistfinancecompaniesholdwelloverone-halfoftheirassetsintheirspecialty

typeoffinancing.Asshownintable4,consumerlendingspecialistsheld83percentofassetsinconsumerloansandleasesin2021,upfrom79percentin2015.Bycomparison,only6percentoftheselenders’assetswereinbusinessloansandleasesin2021,downfrom10percentin

2015.Similarly,realestatespecialistfinancecompaniesheld69percentofassetsinrealestateloansandleasesin2021,withnon-real-estateloansaccountingforlessthan1.5percentofthe

totalassetsofthesecompaniesandtheremaining30percentconsistingofcashandallotherassets.Finally,businessfinancingspecialistsheld73percentoftheirassetsinbusiness

financing,whichaccountedfornearlyalllendingmadebythesefirms.

9The2010and2015censusesdefinedspecializationinthesameway,whilerespondentsdefinedtheirownspecializationinthe2005CensusofFinanceCompaniesandOtherLenders.

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4.Assetshares,bytypeoffinancingandspecializationoflender:2010,2015,and2021

Shareoftotalassets(percent)

Typeoffinancing

201020152021

Consumerlender

Consumer

79

79

83

Realestate

4

1

1

Business

8

10

6

Totalloansandleases

90

90

89

Realestatelender

Consumer

16

2

<.5

Realestate

59

74

69

Business

7

2

1

Totalloansandleases

82

78

69

Businesslender

Consumer

8

2

1

Realestate

9

1

<.5

Business

49

84

73

Totalloansandleases

66

86

74

Note:Componentsmaynotsumtototalsbecauseofrounding.Source:FederalReserveBoard,SurveyofFinanceCompanies.

Withinthebroadlendingspecializationcategories,thereisevidenceofspecializationinsubcategories.Perhapsmostnotably,therearesystematicdifferencesinconsumerautolendingbetweencaptiveandindependentfinancecompanies.Whilecaptivefinance

companiesspecializeinnewcarfinancingforprimeconsumers,independentfinance

companiesfocusmoreonusedcarfinancingfornonprimeconsumers.10Indeed,in2021,65

percentofallautoloanoriginationsbycaptivefinancecompaniesweretoprimeborrowers,20percentweretonear-primeborrowers,and15percentweretosubprimeborrowers.These

percentageswerebroadlyunchangedsince2010.Bycontrast,forindependentfinance

10Primeborrowersareconsumerswithacreditratingover720,subprimewithcreditratingbelow650,andnear-primegreaterthan650andlessthan720.

13

companies,athirdoftotalautoloanoriginationsin2021weretoprimeborrowers,withtheremainingtwo-thirdsoforiginationssplitroughlyequallybetweensubprimeandnear-primeborrowers.11Additionally,27percentofallautooriginationsbycaptivefinancecompanieswereforusedcars,comparedwith90percentforindependentfinancecompanies.

1.5.1.DistributionofFirms,byAssetSizeandSpecialization

Table5,whichdisplaysthedistributionoffinancecompaniesbyassetsizeandlender

specialization,showsthatmostnonbusinessfinancecompanieshadlessthan$10millionin

assetsin2021.Byspecialization,consumerlendershadthelargestshareofsmallfirms,with

over90percentofthesefirmshavinglessthan$10millioninassets.Bycontrast,forbusinesslenders,smallfirmsaccountedforasomewhatlowerpercentageoftotalbusinessassets:Only39percentofbusinesslendersheldlessthan$10millioninassetsin2021,downfrom60

percentin2015.

5.Percentagedistributionoffinancecompanies,byassetsizeandspecializationoflender:2021

Typeoffinancecompany

Assetsize(dollars)

Consumer

Realestate

Business

Lessthan1million

46

32

17

1–10million

45

41

22

10–100million

6

15

30

100million–1billion

2

8

17

1–20billion

1

4

13

20billionorgreater

1

<.5

1

Total

100

100

100

Note:Componentsmaynotsumtototalsbecauseofrounding.Source:FederalReserveBoard,SurveyofFinanceCompanies.

Furthermore,14percentoffinancecompaniesspecializinginbusinessfinancingheldassetsofmorethan$1billion,morethandoublethepercentagein2015.Thepercentoflargefinance

11ThesevaluesareconstructedusingdatafromExperian’sAutoCountRiskReport.

14

companiesincreasedforrealestatespecialistsaswell,withalmost5percentholdingassetsofmorethan$1billion.

1.5.2.BalanceSheetsforSpecializedLenders

Aspreviouslymentioned,almostallfinancecompaniesarespecializedlenders.Tables6and7providegreaterdetailonassetsandfundingsourcesbylenderspecializationin2021.Itshouldbenotedthat90percentoffinancecompanyloansaresecuredbysomeformofcollateral—beitavehicle,equipment,orrealestate—sothatthefinancecompanycouldmoreeasilyrecouplossesinthecaseofdefault.

Asshownintable6,forconsumerfinancingspecialists,motorvehicleloansandleases

represented39percentand22percentofassetsin2021,respectively,whileotherconsumer

creditaccountedfor19percentandconsistedofvarioustypesofclosed-endcredit,which

includesinstallmentcashloans,somenonvehiclesalescredit,andsmall,single-paymentloans(principallypawn,payday,andautotitlelenders).Revolvingconsumercreditamountedtojust

3percentofassets.Asin2015,theremaininglendingbyconsumerfinancingspecialists

consistedlargelyofbusinesswholesalemotorvehicleloans(5percentofassets).Allothertypesofnon-consumerfinancing(includingbusine