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OneMain sees credit metrics improve in Q2; execs say Springleaf integration done

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OneMain sees credit metrics improve in Q2; execs say Springleaf integration done

The integration of Springleaf is essentially completed, and the fruits of that process are starting to become apparent, according to OneMain Holdings Inc. executives.

President and CEO Jay Levine said on a second-quarter earnings conference call that he is very pleased to see how the company's branches have come along, telling investors and analysts that they are now "humming." As recently as November 2016, executives were blaming a rise in early stage delinquencies at legacy OneMain branches on the integration. But with new processes in place, the platforms merged and employee training completed, OneMain experienced significant improvement in its credit metrics in the second quarter.

The net charge-off ratio within the company's consumer and insurance segment declined to 6.9% in the second quarter from 8.5% in the first quarter and 7.3% from a year ago. The segment also saw improvement in its delinquency figures. Levine said OneMain saw "marginally stronger" customers in terms of credit scores in the quarter compared with a year earlier, but also credited the company's new systems and leadership at the branch level for "doing a better job staying on top of those customers."

In response to an analyst's question that touched on the recent Wells Fargo & Co. lender-placed insurance scandal, Levine said OneMain has "very specific" policies as it pertains to auto insurance. The company only places insurance on vehicles where the loans are particularly large, he explained, adding that lender-placed insurance is "immaterial" to OneMain's overall business.