OneMain Holdings Annual Report 2020 Form 10-K (NYSE:OMF) Published: February 14th, 2020 PDF generated by stocklight.com UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☑ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2019 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 (Springleaf Finance Corporation) ONEMAIN HOLDINGS, INC. SPRINGLEAF FINANCE CORPORATION (Exact name of registrant as specified in its charter) Delaware (OneMain Holdings, Inc.) 27-3379612 Indiana (Springleaf 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 Springleaf Finance Corporation: None Securities registered pursuant to Section 12(g) of the Act: None Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. OneMain Holdings, Inc. Yes ☑ No ☐ Springleaf Finance Corporation Yes ☑ No ☐ Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. OneMain Holdings, Inc. Yes ☐ No ☑ Springleaf Finance Corporation Yes ☐ No ☑ 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 ☐ Springleaf 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 ☐ Springleaf Finance Corporation Yes ☑ No ☐ 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 ☐ Springleaf 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. ☐ Springleaf 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 ☑ Springleaf Finance Corporation Yes ☐ No ☑ The aggregate market value of the voting and non-voting common equity of OneMain Holdings, Inc. held by non-affiliates as of the close of business on June 28, 2019 was $2,596,092,195. All of Springleaf Finance Corporation’s common stock is held by OneMain Holdings, Inc. The registrant is directly owned by OneMain Holdings, Inc. At January 31, 2020, there were 136,194,462 shares of OneMain Holdings, Inc.'s common stock, $0.01 par value, outstanding. At January 31, 2020, there were 10,160,021 shares of Springleaf Finance Corporation's common stock, $0.50 par value, outstanding. This annual report on Form 10-K (“Annual Report”) is a combined report being filed separately by two different registrants: OneMain Holdings, Inc. and Springleaf Finance Corporation. Springleaf Finance Corporation’s equity securities are owned directly by OneMain Holdings, Inc. The information in this Annual Report on Form 10-K is equally applicable to OneMain Holdings, Inc. and Springleaf Finance Corporation, except where otherwise indicated. Springleaf Finance Corporation meets the conditions set forth in General Instructions I(1)(a) and (b) of Form 10-K and, to the extent applicable, is therefore filing this form with a reduced disclosure format. DOCUMENTS INCORPORATED BY REFERENCE The information required by Part III (Items 10, 11, 12, 13, and 14) of this Annual Report on Form 10-K is incorporated by reference from OneMain Holdings, Inc.'s Definitive Proxy Statement for its 2020 Annual Meeting to be filed with the Securities and Exchange Commission pursuant to Regulation 14A. Explanatory Note This report combines the Annual Reports on Form 10-K for the year ended December 31, 2019 for OneMain Holdings, Inc. (“OMH”), and its wholly- owned direct subsidiary, Springleaf Finance Corporation (“SFC”). The information in this Annual Report on Form 10-K is equally applicable to OMH and SFC, except where otherwise indicated. OMH and SFC is each filing on its own behalf all the information contained in this report that relates to OMH and SFC, respectively. Each registrant is not filing any information that does not relate to its own entity and therefore makes no representation to any such information. OMH is a financial services holding company whose subsidiaries engage in the consumer finance and insurance businesses. Prior to the completion of the merger described below, OMH’s direct subsidiary was Springleaf Finance, Inc. (“SFI”). On September 20, 2019, SFC entered into a merger agreement with its direct parent, SFI, to merge SFI with and into SFC, with SFC as the surviving entity. The merger was effective in SFC's consolidated financial statements as of July 1, 2019. As a result of SFI's merger with and into SFC, SFC became a wholly-owned direct subsidiary of OMH. OMH and SFC are referred to in this report, collectively with their subsidiaries, whether directly or indirectly owned, as “the Company,” “we,” “us,” or “our.” Management operates OMH and SFC as one enterprise and believes that combining the Annual Reports on Form 10-K into a single report will result in the following benefits: • Facilitate a better understanding by the investors of OMH and SFC by presenting the business in the same manner as management views and operates the business; • Provide a straightforward presentation by removing duplicate disclosures as substantially all the disclosures for OMH and SFC are the same; and • Create time and cost efficiencies through the preparation of one combined report instead of two separate reports. There are nominal differences between OMH and SFC, and to help investors understand these differences, this report presents the following as separate notes or sections for OMH and SFC: • Consolidated Financial Statements; • Note 2 - Reconciliation of Springleaf Finance Corporation Results to OneMain Holdings, Inc. Results; • Note 13 - Capital Stock and Earnings Per Share (OMH Only); • Note 15 - Income Taxes; and • Note 16 - Leases and Contingencies This report also includes separate Item 9A (Controls and Procedures) and separate certifications for OMH and SFC in order to establish that the Chief Executive Officer and the Chief Financial Officer of each entity have made the requisite certifications and that OMH and SFC are compliant with Rule 13a-15 or Rule 15d-15 of the Securities Exchange Act of 1934, as amended, and 18 U.S.C. §1350. TABLE OF CONTENTS Forward-Looking Statements 9 PART I Item 1. Business 12 Item 1A. Risk Factors 21 Item 1B. Unresolved Staff Comments 40 Item 2. Properties 41 Item 3. Legal Proceedings 41 Item 4. Mine Safety Disclosures 41 PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 42 Item 6. Selected Financial Data 44 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 45 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 66 Item 8. Financial Statements and Supplementary Data 67 Report of Independent Registered Public Accounting Firm (OneMain Holdings, Inc.) 68 Report of Independent Registered Public Accounting Firm (Springleaf Finance Corporation) 70 Financial Statements of OneMain Holdings, Inc. and Subsidiaries: Consolidated Balance Sheets 71 Consolidated Statements of Operations 72 Consolidated Statements of Comprehensive Income 73 Consolidated Statements of Shareholders’ Equity 74 Consolidated Statements of Cash Flows 75 Financial Statements of Springleaf Finance Corporation and Subsidiaries: Consolidated Balance Sheets 77 Consolidated Statements of Operations 78 Consolidated Statements of Comprehensive Income 79 Consolidated Statements of Shareholder's Equity 80 Consolidated Statements of Cash Flows 81 Notes to the Consolidated Financial Statements 83 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 140 Item 9A. Controls and Procedures 140 Controls and Procedures of OneMain Holdings, Inc. 140 Controls and Procedures of Springleaf Finance Corporation 141 Item 9B. Other Information 142 PART III Item 10. Directors, Executive Officers and Corporate Governance 143 Item 11. Executive Compensation 143 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 143 Item 13. Certain Relationships and Related Transactions, and Director Independence 143 Item 14. Principal Accounting Fees and Services 143 PART IV Item 15. Exhibits and Financial Statement Schedules 144 Item 16. Form 10-K Summary 144 GLOSSARY Terms and abbreviations used in this report are defined below.