Household Int. Inc 8-K
HSBC Holdings PLC
16 November 2004
The following is a Current Report on Form 8-K containing selected financial
information for the quarter ended 30 September 2004 filed with the United States
Securities and Exchange Commission by Household International, Inc., a
subsidiary of HSBC Holdings plc. Copies of the Form 8-K are available on
Household International, Inc.'s website at www.Household.com and on the SEC
website at www.sec.gov.
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FORM 8-K
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------
FORM 8-K
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report: November 11, 2004
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HOUSEHOLD INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
Delaware 1-8198 86-1052062
(State of incorporation) (Commission File Number) (IRS Employer
Identification Number)
2700 Sanders Road, Prospect Heights, Illinois 60070
(Address of principal executive offices) (Zip Code)
(847) 564-5000
Registrant's telephone number, including area code
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
(_) Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
(_) Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17
CFR 240.14a-12)
(_) Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
(_) Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
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Item 2.02. Results of Operations and Financial Condition
Financial supplement pertaining to the financial results of Household
International, Inc., for the quarter and nine months ended September 30, 2004.
The information shall not be deemed "filed" for the purposes of Section 18 of
the Securities Exchange Act of 1934, as amended (the Exchange Act), or
otherwise incorporated by reference into any filing pursuant to the Securities
Act of 1933, as amended, or the Exchange Act except as otherwise expressly
stated in such a filing.
Item 9.01. Financial Statements, Pro Forma Financial Information and Exhibits
(a) Financial statements of businesses acquired.
Not applicable.
(b) Pro forma financial information.
Not applicable.
(c) Exhibits.
No. Exhibit
--- -------
99 Quarterly Financial Supplement for the quarter ended September 30, 2004.
SIGNATURE
Pursuant to the requirement of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
HOUSEHOLD INTERNATIONAL, INC.
(Registrant)
By: /s/ PATRICK D. SCHWARTZ
-----------------------------
Patrick D. Schwartz
Vice President-Deputy General
Counsel-Corporate
Dated: November 12, 2004
Exhibit 99
(LOGO) HOUSEHOLD
Quarterly Financial Supplement--September 30, 2004
Index Page No.
----- --------
Basis of Reporting.................................................... 2
Consolidated Statements of Income--Owned Basis:
Three Months....................................................... 4
Nine Months........................................................ 6
Receivables Analysis.................................................. 8
Financial Highlights--Managed Basis:
Three Months....................................................... 9
Nine Months........................................................ 10
Credit Quality/Credit Loss Reserves--Managed Basis.................... 11
Reconciliations to GAAP Financial Measures:
Revenues, Average Interest-Earning Assets and Net Interest Income:
Three Months................................................... 12
Nine Months.................................................... 13
Selected Financial Ratios.......................................... 14
Credit Quality/Credit Loss Reserves:
Two-Months-and-Over Contractual Delinquency.................... 15
Quarter-to-Date Charge-offs, Net of Recoveries................. 15
Real Estate Charge-offs and REO Expense........................ 17
Credit Loss Reserves........................................... 18
Nonperforming Assets........................................... 19
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Basis of Reporting
Non-GAAP Financial Measures
This Quarterly Financial Supplement includes financial information which is
presented on a non-GAAP basis as discussed below. Information included in this
Quarterly Financial Supplement is intended to supplement and should not be
considered a substitute for owned basis reporting. This Quarterly Financial
Supplement should be read in conjunction with the owned basis information
reported in our Quarterly Reports on Form 10-Q.
See "Reconciliations to GAAP Financial Measures" for quantitative
reconciliations of non-GAAP financial information to the equivalent owned basis
GAAP financial information.
Managed basis reporting We monitor our operations and evaluate trends on a
managed basis (a non-GAAP financial measure), which assumes that securitized
receivables have not been sold and are still on our balance sheet. We manage
and evaluate our operations on a managed basis because the receivables that we
securitize are subjected to underwriting standards comparable to our owned
portfolio, are serviced by operating personnel without regard to ownership and
result in a similar credit loss exposure for us. In addition, we fund our
operations, review our operating results, and make decisions about allocating
resources such as employees and capital on a managed basis.
When reporting on a managed basis, net interest income, provision for credit
losses and fee income related to receivables securitized are reclassified from
securitization revenue in our owned statements of income into the appropriate
caption. Additionally, charge-off and delinquency associated with these
receivables are included in our managed basis credit quality statistics.
Debt analysts, rating agencies and others also evaluate our operations on a
managed basis for the reasons discussed above and have historically requested
managed basis information from us. We believe that managed basis information
enables investors and other interested parties to better understand the
performance and quality of our entire managed loan portfolio and is important
to understanding the quality of originations and the related credit risk
inherent in our owned and securitized portfolios. As the level of our
securitized receivables falls over time, managed basis and owned basis results
will eventually converge, and we will only report owned basis results.
Operating results, percentages and ratios Certain percentages and ratios
have been presented on an operating basis and have been calculated using
"operating net income", a non-GAAP financial measure. "Operating net income" is
net income excluding $167 million, after-tax, of HSBC acquisition related costs
and other merger related items incurred by Household in the first quarter of
2003. This nonrecurring item is also excluded in calculating our operating
basis efficiency ratios. We believe that excluding this nonrecurring item helps
readers of our financial statements to better understand the results and trends
of our underlying business.
A reconciliation of net income to operating net income follows:
Three Months Ended Nine Months Ended
----------------------- -----------------
9/30/04 6/30/04 9/30/03 9/30/04 9/30/03
------- ------- ------- ------- -------
($ millions)
Net income................................................... $322 $395 $472 $1,198 $1,091
HSBC acquisition related costs and other merger related items
incurred by Household, after-tax........................... -- -- -- -- 167
---- ---- ---- ------ ------
Operating net income......................................... $322 $395 $472 $1,198 $1,258
==== ==== ==== ====== ======
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Predecessor and Successor Periods
Household's acquisition by HSBC on March 28, 2003 has resulted in a new
basis of accounting reflecting the fair value of our assets and liabilities for
the "successor" period beginning March 29, 2003. Information for all
"predecessor" periods prior to the merger are presented using our historical
basis of accounting, which impacts comparability with the "successor" period
beginning March 29, 2003. To assist in the comparability of our financial
results and to make it easier to discuss and understand our results of
operations, this Quarterly Financial Supplement combines the "predecessor"
period (January 1 to March 28, 2003) with the "successor" period (March 29 to
September 30, 2003) to present "combined" results for the nine months ended
September 30, 2003.
Reclassifications
Certain reclassifications have been made to prior period amounts to conform
to the current period presentation. Immaterial adjustments have been made to
decrease finance income and increase securitization revenue as reported in
prior periods. These adjustments reflect corrections after discovery of a
system programming error in the posting of finance income between owned
receivables and receivables serviced with limited recourse. Reported net income
for all prior periods was not affected.
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Consolidated Statements of Income--Owned Basis
Three Months
% Change
Three Months Ended from Prior
----------------------- -------------
9/30/04 6/30/04 9/30/03 Qtr. Year
------- ------- ------- ----- -----
(dollars are in millions)
Finance and other interest income.................... $2,779 $2,637 $2,571 5.4% 8.1%
Interest expense..................................... 744 640 557 16.3 33.6
------ ------ ------ ----- -----
Net interest income.................................. 2,035 1,997 2,014 1.9 1.0
Provision for credit losses.......................... 1,123 997 1,001 12.6 12.2
------ ------ ------ ----- -----
Net interest income after provision for credit losses 912 1,000 1,013 (8.8) (10.0)
------ ------ ------ ----- -----
Other revenues:
Securitization revenue............................ 267 266 387 .4 (31.0)
Insurance revenue................................. 203 204 193 (.5) 5.2
Investment income................................. 36 30 37 20.0 (2.7)
Fee income........................................ 302 242 266 24.8 13.5
Other income...................................... 161 184 68 (12.5) 100+
------ ------ ------ ----- -----
Total other revenues................................. 969 926 951 4.6 1.9
------ ------ ------ ----- -----
Costs and expenses:
Salaries and fringe benefits...................... 472 457 493 3.3 (4.3)
Sales incentives.................................. 91 90 77 1.1 18.2
Occupancy and equipment expenses.................. 77 77 95 -- (18.9)
Other marketing expenses.......................... 174 131 128 32.8 35.9
Other servicing and administrative expenses....... 235 198 282 18.7 (16.7)
Support services from affiliates.................. 183 196 -- (6.6) 100.0
Amortization of acquired intangibles.............. 83 79 82 5.1 1.2
Policyholders' benefits........................... 93 93 95 -- (2.1)
------ ------ ------ ----- -----
Total costs and expenses............................. 1,408 1,321 1,252 6.6 12.5
------ ------ ------ ----- -----
Income before income tax expense..................... 473 605 712 (21.8) (33.6)
Income tax expense................................... 151 210 240 (28.1) (37.1)
------ ------ ------ ----- -----
Net income........................................... $ 322 $ 395 $ 472 (18.5)% (31.8)%
====== ====== ====== ===== =====
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Consolidated Statements of Income--Owned Basis
Securitization Revenue
Three Months Ended
-----------------------
9/30/04 6/30/04 9/30/03
------- ------- -------
(in millions)
Net initial gains.................. $ -- $ 22 $ 25
Net replenishment gains............ 112 113 138
Servicing revenue and excess spread 155 131 224
---- ---- ----
Total.............................. $267 $266 $387
==== ==== ====
Receivables Securitized
Three Months Ended
-----------------------
9/30/04 6/30/04 9/30/03
------- ------- -------
(in millions)
Auto finance............ $ -- $300 $ --
MasterCard/Visa(1)...... -- 500 350
Private label........... -- 190 --
Personal non-credit card -- -- 885
----- ---- ------
Total................... $ -- $990 $1,235
===== ==== ======
--------
(1) MasterCard and Visa are registered trademarks of MasterCard International,
Incorporated and VISA USA Inc., respectively.
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Consolidated Statements of Income--Owned Basis
Nine Months
Nine Months Ended
-------------------------
9/30/04 9/30/03(1) % Change
------- ---------- --------
(dollars are in millions)
Finance and other interest income....................... $7,945 $7,616 4.3%
Interest expense........................................ 2,021 2,027 (.3)
------ ------ ------
Net interest income..................................... 5,924 5,589 6.0
Provision for credit losses............................. 3,048 3,050 (.1)
------ ------ ------
Net interest income after provision for credit losses... 2,876 2,539 13.3
------ ------ ------
Other revenues:
Securitization revenue............................... 881 1,114 (20.9)
Insurance revenue.................................... 618 553 11.8
Investment income.................................... 107 151 (29.1)
Fee income........................................... 808 783 3.2
Other income......................................... 650 484 34.3
------ ------ ------
Total other revenues.................................... 3,064 3,085 (.7)
------ ------ ------
Costs and expenses:
Salaries and fringe benefits......................... 1,415 1,490 (5.0)
Sales incentives..................................... 260 199 30.7
Occupancy and equipment expenses..................... 237 297 (20.2)
Other marketing expenses............................. 437 407 7.4
Other servicing and administrative expenses.......... 659 869 (24.2)
Support services from affiliates..................... 556 -- 100.0
Amortization of acquired intangibles................. 278 175 58.9
Policyholders' benefits.............................. 299 287 4.2
HSBC acquisition related costs incurred by Household. -- 198 (100.0)
------ ------ ------
Total costs and expenses................................ 4,141 3,922 5.6
------ ------ ------
Income before income tax expense........................ 1,799 1,702 5.7
Income tax expense...................................... 601 611 (1.6)
------ ------ ------
Net income.............................................. $1,198 $1,091 9.8%
====== ====== ======
HSBC acquisition related costs incurred by Household.... -- 167 (100.0)
------ ------ ------
Operating net income(2)................................. $1,198 $1,258 (4.8)%
====== ====== ======
(1) To assist in the comparability of our financial results, the "predecessor"
period (January 1 to March 28, 2003) has been combined with the "successor"
period (March 29 to September 30, 2003) to present "combined" results for
the nine months ended September 30, 2003. See "Basis of Reporting" for
additional information regarding the "successor" period and "predecessor"
period.
(2) Operating net income is a non-GAAP financial measure which is provided for
comparison of our operating trends and should be read in conjunction with
our owned basis GAAP financial information. See "Basis of Reporting" for a
discussion on the use of non-GAAP financial information and
"Reconciliations to GAAP Financial Measures" for quantitative
reconciliations to the equivalent GAAP basis financial measure.
6
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Consolidated Statements of Income--Owned Basis
Securitization Revenue
Nine Months Ended
------------------
9/30/04 9/30/03(1)
------- ----------
(in millions)
Net initial gains.................. $ 25 $ 92
Net replenishment gains............ 344 410
Servicing revenue and excess spread 512 612
---- ------
Total.............................. $881 $1,114
==== ======
Receivables Securitized
Nine Months Ended
------------------
9/30/04 9/30/03(1)
------- ----------
(in millions)
Auto finance............ $ -- $1,007
MasterCard/Visa......... 550 670
Private label........... 190 250
Personal non-credit card -- 1,700
---- ------
Total................... $740 $3,627
==== ======
(1) To assist in the comparability of our financial results, the "predecessor"
period (January 1 to March 28, 2003) has been combined with the "successor"
period (March 29 to September 30, 2003) to present "combined" results for
the nine months ended September 30, 2003. See "Basis of Reporting" for
additional information regarding the "successor" period and "predecessor"
period.
(2) Operating net income is a non-GAAP financial measure which is provided for
comparison of our operating trends and should be read in conjunction with
our owned basis GAAP financial information. See "Basis of Reporting" for a
discussion on the use of non-GAAP financial information and
"Reconciliations to GAAP Financial Measures" for quantitative
reconciliations to the equivalent GAAP basis financial measure.
7
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Receivables Analysis
End-of-Period Receivables
% Change
from Prior
------------
9/30/04 6/30/04 9/30/03 Qtr. Year
-------- -------- -------- ----- -----
(dollars are in millions)
Owned receivables:
Real estate secured(1)....................... $ 58,726 $ 56,033 $ 52,769 4.8% 11.3%
Auto finance................................. 6,823 5,459 3,701 25.0 84.4
MasterCard/Visa.............................. 11,666 10,816 9,892 7.9 17.9
Private label................................ 14,000 12,759 12,407 9.7 12.8
Personal non-credit card..................... 14,888 14,019 13,850 6.2 7.5
Commercial and other......................... 334 346 409 (3.5) (18.3)
-------- -------- -------- ----- -----
Total owned receivables......................... 106,437 99,432 93,028 7.0 14.4
-------- -------- -------- ----- -----
Receivables serviced with limited recourse:
Real estate secured.......................... 165 176 214 (6.3) (22.9)
Auto finance................................. 3,060 3,877 4,700 (21.1) (34.9)
MasterCard/Visa.............................. 8,843 9,345 9,927 (5.4) (10.9)
Private label................................ 3,921 4,723 4,261 (17.0) (8.0)
Personal non-credit card..................... 4,186 4,715 5,007 (11.2) (16.4)
-------- -------- -------- ----- -----
Total receivables serviced with limited recourse 20,175 22,836 24,109 (11.7) (16.3)
-------- -------- -------- ----- -----
Managed receivables: (2)
Real estate secured.......................... 58,891 56,209 52,983 4.8 11.2
Auto finance................................. 9,883 9,336 8,401 5.9 17.6
MasterCard/Visa.............................. 20,509 20,161 19,819 1.7 3.5
Private label................................ 17,921 17,482 16,668 2.5 7.5
Personal non-credit card(3).................. 19,074 18,734 18,857 1.8 1.2
Commercial and other......................... 334 346 409 (3.5) (18.3)
-------- -------- -------- ----- -----
Total managed receivables....................... $126,612 $122,268 $117,137 3.6% 8.1%
======== ======== ======== ===== =====
--------
(1) Real estate secured receivable levels reflect sales to HSBC Bank USA, N.A.
of $.9 billion on March 31, 2004 and $2.8 billion on December 31, 2003.
(2) Managed basis reporting is a non-GAAP financial measure. See "Basis of
Reporting" for a discussion on the use of non-GAAP financial information.
(3) Personal non-credit card receivables are comprised of the following:
9/30/04 6/30/04 9/30/03
------- ------- -------
(in millions)
Domestic personal unsecured.. $10,054 $ 9,788 $10,046
Union Plus personal unsecured 510 576 755
Personal homeowner loans..... 4,587 4,555 4,692
Foreign unsecured............ 3,923 3,815 3,364
------- ------- -------
Total........................ $19,074 $18,734 $18,857
======= ======= =======
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Financial Highlights--Managed Basis(1)
Revenues, Average Interest-Earning Assets and Net Interest Income
Three Months
% Change
Three Months Ended from Prior
------------------------------------------------- -------------
9/30/04 (2) 6/30/04 (2) 9/30/03 (2) Qtr. Year
-------- ----- -------- ----- -------- ----- ----- -----
(dollars are in millions)
Finance and other interest
income........................ $ 3,494 10.79% $ 3,417 10.95% $ 3,419 11.43% 2.3% 2.2%
Interest expense................ 877 2.71 768 2.46 690 2.31 14.2 27.1
-------- ----- -------- ----- -------- ----- ----- -----
Net interest income............. 2,617 8.08% 2,649 8.49% 2,729 9.12% (1.2) (4.1)
Provision for credit losses..... 891 1,145 1,421 (22.2) (37.3)
-------- -------- -------- ----- -----
Net interest income after
provision for credit losses... $ 1,726 $ 1,504 $ 1,308 14.8% 32.0%
======== ======== ======== ===== =====
Other revenues:
Insurance revenue............ $ 203 $ 204 $ 193 (.5)% 5.2%
Investment income............ 36 30 37 20.0 (2.7)
Fee income................... 497 440 458 13.0 8.5
Securitization revenue....... (742) (436) (100) 70.2 100+
Other income................. 161 184 68 (12.5) 100+
-------- -------- -------- ----- -----
Total other revenues............ $ 155 $ 422 $ 656 (63.3)% (76.4)%
======== ======== ======== ===== =====
Average managed receivables.....
Real estate secured.......... $ 57,741 $ 54,398 $ 51,274 6.1% 12.6%
Auto finance................. 9,598 9,178 8,082 4.6 18.8
MasterCard/Visa.............. 20,441 20,212 19,300 1.1 5.9
Private label................ 17,626 17,362 16,348 1.5 7.8
Personal non-credit card..... 18,928 18,568 18,849 1.9 .4
Commercial and other......... 336 367 418 (8.4) (19.6)
Purchase accounting fair
value adjustments.......... 295 346 505 (14.7) (41.6)
-------- -------- -------- ----- -----
Average managed receivables..... $124,965 $120,431 $114,776 3.8% 8.9%
Average noninsurance
investments................... 3,878 3,728 4,309 4.0 (10.0)
Other interest-earning assets... 654 647 633 1.1 3.3
-------- -------- -------- ----- -----
Average managed interest-earning
assets........................ $129,497 $124,806 $119,718 3.8% 8.2%
======== ======== ======== ===== =====
Selected Financial Ratios:
Return on average managed
assets........................ .88 % 1.12 % 1.39 % (21.4)% (36.7)%
Efficiency ratio................ 49.1 41.3 35.2 18.9 39.5
Net interest margin............. 8.08 8.49 9.12 (4.8) (11.4)
Risk adjusted revenue........... 6.64 6.86 7.19 (3.2) (7.6)
-------- -------- -------- ----- -----
--------
(1) Managed basis reporting is a non-GAAP financial measure. See "Basis of
Reporting" for a discussion on the use of non-GAAP financial information
and "Reconciliations to GAAP Financial Measures" for quantitative
reconciliations to the equivalent GAAP basis financial measure.
(2) % Columns: comparison to average managed interest-earning assets,
annualized.
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Financial Highlights--Managed Basis(1)
Revenues, Average Interest-Earning Assets and Net Interest Income
Nine Months
Nine Months Ended
---------------------------------
9/30/04 (2) 9/30/03(3) (2) % Change
-------- ----- ---------- ----- --------
(dollars are in millions)
Finance and other interest income.................... $ 10,327 10.89% $ 10,210 11.71% 1.1%
Interest expense..................................... 2,417 2.55 2,459 2.82 (1.7)
-------- ----- -------- ----- -----
Net interest income.................................. 7,910 8.34% 7,751 8.89% 2.1
Provision for credit losses.......................... 3,217 4,494 (28.4)
-------- -------- -----
Net interest income after provision for credit losses $ 4,693 $ 3,257 44.1%
======== ======== =====
Other revenues:
Insurance revenue................................ $ 618 $ 553 11.8%
Investment income................................ 107 151 (29.1)
Fee income....................................... 1,399 1,297 7.9
Securitization revenue........................... (1,527) (118) 100+
Other income..................................... 650 484 34.3
-------- -------- -----
Total other revenues................................. $ 1,247 $ 2,367 (47.3)%
======== ======== =====
Average managed receivables
Real estate secured.............................. $ 54,768 $ 48,883 12.0 %
Auto finance..................................... 9,226 7,682 20.1
MasterCard/Visa.................................. 20,492 18,922 8.3
Private label.................................... 17,486 15,668 11.6
Personal non-credit card......................... 18,784 19,099 (1.6)
Commercial and other............................. 365 440 (17.0)
Purchase accounting fair value adjustments....... 344 381 (9.7)
-------- -------- -----
Average managed receivables.......................... $121,465 $111,075 9.4%
Average noninsurance investments..................... 4,307 4,604 (6.5)
Other interest-earning assets........................ 647 626 3.4
-------- -------- -----
Average managed interest-earning assets.............. $126,419 $116,305 8.7%
======== ======== =====
Selected Financial Ratios:
Return on average managed assets..................... 1.11% 1.11% -- %
Efficiency ratio..................................... 43.4 37.0 17.3
Net interest margin.................................. 8.34 8.89 (6.2)
Risk adjusted revenue................................ 6.87 7.21 (4.7)
Excluding Nonrecurring Items/Operating Basis: (4)
Return on average managed assets..................... 1.11 1.27 (12.6)
Efficiency ratio..................................... 43.4 35.0 24.0
-------- -------- -----
--------
(1) Managed basis reporting is a non-GAAP financial measure. See "Basis of
Reporting" for a discussion on the use of non-GAAP financial information
and "Reconciliations to GAAP Financial Measures" for quantitative
reconciliations to the equivalent GAAP basis financial measure.
(2) % Columns: comparison to average managed interest-earning assets,
annualized.
(3) To assist in the comparability of our financial results, the "predecessor"
period (January 1 to March 28, 2003) has been combined with the "successor"
period (March 29 to September 30, 2003) to present "combined" results for
the nine months ended September 30, 2003. See "Basis of Reporting" for
additional information regarding the "successor" period and "predecessor"
period.
(4) Operating net income is a non-GAAP financial measure which is provided for
comparison of our operating trends and should be read in conjunction with
our owned basis GAAP financial information. See "Basis of Reporting" for a
discussion on the use of non-GAAP financial information and
"Reconciliations to GAAP Financial Measures" for quantitative
reconciliations to the equivalent GAAP basis financial measure.
10
Household International, Inc.
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Credit Quality/Credit Loss Reserves--Managed Basis(1)
Two-Months-and-Over Contractual Delinquency
9/30/04 6/30/04 9/30/03
As a percent of managed consumer receivables, excludes commercial. ------- ------- -------
Real estate secured.............................................................. 3.30% 3.41% 4.23%
Auto finance..................................................................... 2.74 3.03 3.82
MasterCard/Visa.................................................................. 4.44 4.21 4.29
Private label.................................................................... 4.76 4.81 5.24
Personal non-credit card......................................................... 9.52 9.81 10.42
------- ------- -------
Total............................................................................ 4.59% 4.70% 5.36%
======= ======= =======
Quarter-to-Date Charge-offs, Net of Recoveries
9/30/04 6/30/04 9/30/03
As a percent of average managed consumer receivables, annualized, excludes commercial. ------- ------- -------
Real estate secured.............................................................. 1.19 % 1.04 % .91 %
Auto finance..................................................................... 6.04 5.04 7.08
MasterCard/Visa.................................................................. 6.92 7.62 7.12
Private label.................................................................... 4.85 4.92 5.46
Personal non-credit card......................................................... 10.12 11.00 10.72
------- ------- -------
Total............................................................................ 4.38 % 4.57 % 4.68 %
======= ======= =======
Real estate charge-offs and REO expense as a percent of average managed real
estate secured receivables..................................................... 1.31 % 1.47 % 1.36 %
======= ======= =======
Credit Loss Reserves
9/30/04 6/30/04 9/30/03
------- ------- -------
(dollars are in millions)
Reserves for managed receivables at beginning of quarter $ 5,699 $ 5,912 $ 5,639
Provision for credit losses...................................................... 891 1,145 1,421
Charge-offs, net of recoveries................................................... (1,363) (1,367) (1,334)
Other, net....................................................................... (28) 9 7
------- ------- -------
Reserves for managed receivables at end of quarter............................... $ 5,199 $ 5,699 $ 5,733
======= ======= =======
Reserves as a percent of managed receivables..................................... 4.11 % 4.66 % 4.89 %
------- ------- -------
Nonperforming Assets
9/30/04 6/30/04 9/30/03
------- ------- -------
(dollars are in millions)
Nonaccrual managed receivables................................................... $ 3,476 $ 3,506 $ 3,944
Accruing managed receivables 90 or more days delinquent.......................... 1,201 1,135 1,188
Renegotiated commercial loans.................................................... 1 1 2
------- ------- -------
Total nonperforming managed receivables.......................................... 4,678 4,642 5,134
Real estate owned................................................................ 601 624 543
------- ------- -------
Total nonperforming assets....................................................... $ 5,279 $ 5,266 $ 5,677
======= ======= =======
Managed credit loss reserves as a percent of nonperforming managed
receivables.................................................................... 111.1% 122.8% 111.7%
------- ------- -------
--------
(1) Managed basis reporting is a non-GAAP financial measure. See "Basis of
Reporting" for a discussion on the use of non-GAAP financial information
and "Reconciliations to GAAP Financial Measures" for quantitative
reconciliations to the equivalent GAAP basis financial measure.
11
Household International, Inc.
--------------------------------------------------------------------------------
Reconciliation to GAAP Financial Measures
Revenues, Average Interest-Earning Assets and Net Interest Income
Three Months
Three Months Ended 9/30/04 Three Months Ended 6/30/04
-------------------------------- --------------------------------
Serviced with Serviced with
Limited Limited
Owned Recourse(1) Managed Owned Recourse(1) Managed
-------- ------------- -------- -------- ------------- --------
(dollars are in millions)
Finance and other interest
income.................... $ 2,779 $ 715 $ 3,494 $ 2,637 $ 780 $ 3,417
Interest expense........... 744 133 877 640 128 768
-------- ------- -------- -------- ------- --------
Net interest income........ 2,035 582 2,617 1,997 652 2,649
Provision for credit
losses.................... 1,123 (232) 891 997 148 1,145
-------- ------- -------- -------- ------- --------
Net interest income after
provision for credit
losses.................... $ 912 $ 814 $ 1,726 $ 1,000 $ 504 $ 1,504
======== ======= ======== ======== ======= ========
Other revenues:
Securitization revenue... $ 267 $(1,009) $ (742) $ 266 $ (702) $ (436)
Insurance revenue........ 203 -- 203 204 -- 204
Investment income........ 36 -- 36 30 -- 30
Fee income............... 302 195 497 242 198 440
Other income............. 161 -- 161 184 -- 184
-------- ------- -------- -------- ------- --------
Total other revenues....... $ 969 $ (814) $ 155 $ 926 $ (504) $ 422
======== ======= ======== ======== ======= ========
Average receivables:
Real estate secured...... $ 57,570 $ 171 $ 57,741 $ 54,220 $ 178 $ 54,398
Auto finance............. 6,238 3,360 9,598 5,197 3,981 9,178
MasterCard/Visa.......... 11,251 9,190 20,441 10,913 9,299 20,212
Private label............ 13,310 4,316 17,626 12,249 5,113 17,362
Personal non-credit
card.................... 14,423 4,505 18,928 13,571 4,997 18,568
Commercial and other..... 336 -- 336 367 -- 367
Purchase accounting fair
value adjustments....... 295 -- 295 346 -- 346
-------- ------- -------- -------- ------- --------
Average receivables........ $103,423 $21,542 $124,965 $ 96,863 $23,568 $120,431
Average noninsurance
investments............... 3,878 -- 3,878 3,728 -- 3,728
Other interest-earning
assets.................... 654 -- 654 647 -- 647
-------- ------- -------- -------- ------- --------
Average interest-earning
assets.................... $107,955 $21,542 $129,497 $101,238 $23,568 $124,806
======== ======= ======== ======== ======= ========
Net interest income as a
percentage of average
interest-earning assets... 7.54% 10.81% 8.08% 7.89% 11.06% 8.49%
======== ======= ======== ======== ======= ========
Three Months Ended 9/30/03
-------------------------------
Serviced with
Limited
Owned Recourse(1) Managed
------- ------------- --------
Finance and other interest
income.................... $ 2,571 $ 848 $ 3,419
Interest expense........... 557 133 690
------- ------- --------
Net interest income........ 2,014 715 2,729
Provision for credit
losses.................... 1,001 420 1,421
------- ------- --------
Net interest income after
provision for credit
losses.................... $ 1,013 $ 295 $ 1,308
======= ======= ========
Other revenues:
Securitization revenue... $ 387 $ (487) $ (100)
Insurance revenue........ 193 -- 193
Investment income........ 37 -- 37
Fee income............... 266 192 458
Other income............. 68 -- 68
------- ------- --------
Total other revenues....... $ 951 $ (295) $ 656
======= ======= ========
Average receivables:
Real estate secured...... $51,047 $ 227 $ 51,274
Auto finance............. 3,113 4,969 8,082
MasterCard/Visa.......... 9,697 9,603 19,300
Private label............ 12,107 4,241 16,348
Personal non-credit
card.................... 14,170 4,679 18,849
Commercial and other..... 418 -- 418
Purchase accounting fair
value adjustments....... 505 -- 505
------- ------- --------
Average receivables........ $91,057 $23,719 $114,776
Average noninsurance
investments............... 4,309 -- 4,309
Other interest-earning
assets.................... 633 -- 633
------- ------- --------
Average interest-earning
assets.................... $95,999 $23,719 $119,718
======= ======= ========
Net interest income as a
percentage of average
interest-earning assets... 8.39% 12.06% 9.12%
======= ======= ========
--------
(1) When reporting on a managed basis, finance and other interest income,
interest expense, provision for credit losses and fee income related to
securitized receivables are reclassified from securitization revenue in our
owned statements of income into the appropriate caption.
12
Household International, Inc.
--------------------------------------------------------------------------------
Reconciliation to GAAP Financial Measures
Revenues, Average Interest-Earning Assets and Net Interest Income
Nine Months
Nine Months Ended 9/30/04 Nine Months Ended 9/30/03
-------------------------------- -------------------------------
Serviced with Serviced with
Limited Limited
Owned Recourse(1) Managed Owned Recourse(1) Managed
-------- ------------- -------- ------- ------------- --------
(dollars are in millions)
Finance and other interest income...... $ 7,945 $ 2,382 $ 10,327 $ 7,616 $ 2,594 $ 10,210
Interest expense....................... 2,021 396 2,417 2,027 432 2,459
-------- ------- -------- ------- ------- --------
Net interest income.................... 5,924 1,986 7,910 5,589 2,162 7,751
Provision for credit losses............ 3,048 169 3,217 3,050 1,444 4,494
-------- ------- -------- ------- ------- --------
Net interest income after provision for
credit losses........................ $ 2,876 $ 1,817 $ 4,693 $ 2,539 $ 718 $ 3,257
======== ======= ======== ======= ======= ========
Other revenues:
Securitization revenue.............. $ 881 $(2,408) $ (1,527) $ 1,114 $(1,232) $ (118)
Insurance revenue................... 618 -- 618 553 -- 553
Investment income................... 107 -- 107 151 -- 151
Fee income.......................... 808 591 1,399 783 514 1,297
Other income........................ 650 -- 650 484 -- 484
-------- ------- -------- ------- ------- --------
Total other revenues................... $ 3,064 $(1,817) $ 1,247 $ 3,085 $ (718) $ 2,367
======== ======= ======== ======= ======= ========
Average receivables:
Real estate secured................. $ 54,589 $ 179 $ 54,768 $48,588 $ 295 $ 48,883
Auto finance........................ 5,315 3,911 9,226 2,573 5,109 7,682
MasterCard/Visa..................... 11,097 9,395 20,492 9,229 9,693 18,922
Private label....................... 12,589 4,897 17,486 11,735 3,933 15,668
Personal non-credit card............ 13,703 5,081 18,784 14,144 4,955 19,099
Commercial and other................ 365 -- 365 440 -- 440
Purchase accounting fair value
adjustments....................... 344 -- 344 381 -- 381
-------- ------- -------- ------- ------- --------
Average receivables.................... $ 98,002 $23,463 $121,465 $87,090 $23,985 $111,075
Average noninsurance investments....... 4,307 -- 4,307 4,604 -- 4,604
Other interest-earning assets.......... 647 -- 647 626 -- 626
-------- ------- -------- ------- ------- --------
Average interest-earning assets........ $102,956 $23,463 $126,419 $92,320 $23,985 $116,305
======== ======= ======== ======= ======= ========
Net interest income as a percentage of
average interest-earning assets...... 7.67% 11.29% 8.34% 8.07% 12.02% 8.89%
======== ======= ======== ======= ======= ========
--------
(1) When reporting on a managed basis, finance and other interest income,
interest expense, provision for credit losses and fee income related to
securitized receivables are reclassified from securitization revenue in our
owned statements of income into the appropriate caption.
13
Household International, Inc.
--------------------------------------------------------------------------------
Reconciliation to GAAP Financial Measures
Selected Financial Ratios
Three Months Ended Nine Months Ended
---------------------------- ------------------
9/30/04 6/30/04 9/30/03 9/30/04 9/30/03
-------- -------- -------- -------- --------
(dollars are in millions)
Return on Average Common Shareholder's(s') Equity:
Net income................................................... $ 322 $ 395 $ 472 $ 1,198 $ 1,091
Dividends on preferred stock............................. (18) (18) (18) (54) (58)
-------- -------- -------- -------- --------
Net income available to common shareholders.................. $ 304 $ 377 $ 454 $ 1,144 $ 1,033
HSBC acquisition related costs incurred by Household......... -- -- -- -- 167
-------- -------- -------- -------- --------
Operating net income available to common shareholders........ $ 304 $ 377 $ 454 $ 1,144 $ 1,200
-------- -------- -------- -------- --------
Average common shareholder's(s') equity...................... $ 17,573 $ 17,345 $ 15,434 $ 17,239 $ 13,266
-------- -------- -------- -------- --------
Return on average common shareholder's(s') equity............ 6.9% 8.7% 11.8% 8.8% 10.4%
Return on average common shareholder's(s') equity, operating
basis....................................................... 6.9 8.7 11.8 8.8 12.1
======== ======== ======== ======== ========
Return on Average Assets:
Net income................................................... $ 322 $ 395 $ 472 $ 1,198 $ 1,091
Operating net income......................................... 322 395 472 1,198 1,258
-------- -------- -------- -------- --------
Average assets:
Owned basis.............................................. $124,531 $117,523 $112,095 $120,506 $107,632
Serviced with limited recourse........................... 21,542 23,568 23,719 23,462 23,985
-------- -------- -------- -------- --------
Managed basis............................................ $146,073 $141,091 $135,814 $143,968 $131,617
======== ======== ======== ======== ========
Return on average owned assets............................... 1.03% 1.34% 1.68% 1.33% 1.35%
Return on average owned assets, operating basis.............. 1.03 1.34 1.68 1.33 1.56
Return on average managed assets............................. .88 1.12 1.39 1.11 1.11
Return on average managed assets, operating basis............ .88 1.12 1.39 1.11 1.27
======== ======== ======== ======== ========
Efficiency Ratio:
Total costs and expenses less policyholders' benefits........ $ 1,315 $ 1,229 $ 1,157 $ 3,842 $ 3,635
HSBC acquisition related costs incurred by Household..... -- -- -- -- (198)
-------- -------- -------- -------- --------
Total costs and expenses less policyholders' benefits,
excluding nonrecurring items............................ $ 1,315 $ 1,229 $ 1,157 $ 3,842 $ 3,437
-------- -------- -------- -------- --------
Net interest income and other revenues less policyholders'
benefits:
Owned basis.............................................. $ 2,911 $ 2,831 $ 2,870 $ 8,689 $ 8,387
Serviced with limited recourse........................... (232) 148 420 169 1,444
-------- -------- -------- -------- --------
Managed basis............................................ $ 2,679 $ 2,979 $ 3,290 $ 8,858 $ 9,831
-------- -------- -------- -------- --------
Owned basis efficiency ratio................................. 45.2% 43.4% 40.3% 44.2% 43.3%
Owned basis efficiency ratio, operating basis................ 45.2 43.4 40.3 44.2 41.0
Managed basis efficiency ratio............................... 49.1 41.3 35.2 43.4 37.0
Managed basis efficiency ratio, operating basis.............. 49.1 41.3 35.2 43.4 35.0
======== ======== ======== ======== ========
Managed Basis Risk Adjusted Revenue:
Net interest income.......................................... $ 2,617 $ 2,649 $ 2,729 $ 7,910 $ 7,751
Other revenues, excluding securitization revenue............. 897 858 756 2,774 2,485
Less: Net charge-offs........................................ (1,363) (1,367) (1,334) (4,172) (3,950)
-------- -------- -------- -------- --------
Risk adjusted revenue........................................ $ 2,151 $ 2,140 $ 2,151 $ 6,512 $ 6,286
Average interest-earning assets.............................. 129,497 124,806 119,718 126,419 116,305
-------- -------- -------- -------- --------
Managed basis risk adjusted revenue.......................... 6.64% 6.86% 7.19% 6.87% 7.21%
======== ======== ======== ======== ========
14
Household International, Inc.
--------------------------------------------------------------------------------
Reconciliation to GAAP Financial Measures
Credit Quality/Credit Loss Reserves
Two-Months-and-Over Quarter-to-Date Charge-offs,
Contractual Delinquency Net of Recoveries
------------------------------------- ---------------------------------
Two-Months- Two-Months-
and-Over Consumer and-Over Net Average
Contractual Receivables Contractual Charge- Consumer Net
Delinquency Outstanding Delinquency(1) offs Receivables Charge-offs(1)
----------- ----------- -------------- ------- ----------- --------------
(dollars are in millions)
September 30, 2004
Owned:
First mortgage................... $ 2 $ 27 5.78% $ -- $ 28 .41%
Real estate secured.............. 1,921 58,726 3.27 171 57,570 1.19
Auto finance..................... 124 6,823 1.81 57 6,238 3.66
MasterCard/Visa.................. 681 11,666 5.84 239 11,251 8.50
Private label.................... 660 14,000 4.72 159 13,310 4.79
Personal non-credit card......... 1,314 14,888 8.83 343 14,423 9.50
------ -------- ----- ------ -------- -----
Total............................ $4,702 $106,130 4.43% $ 969 $102,820 3.77%
====== ======== ===== ====== ======== =====
Serviced with Limited Recourse:
Real estate secured.............. $ 21 $ 165 12.73% $ -- $ 171 -- %
Auto finance..................... 146 3,060 4.77 88 3,360 10.48
MasterCard/Visa.................. 230 8,843 2.60 115 9,190 5.01
Private label.................... 193 3,921 4.92 55 4,316 5.10
Personal non-credit card......... 502 4,186 11.99 136 4,505 12.08
------ -------- ----- ------ -------- -----
Total............................ $1,092 $ 20,175 5.41% $ 394 $ 21,542 7.32%
====== ======== ===== ====== ======== =====
Managed:
First mortgage................... $ 2 $ 27 5.78% $ -- $ 28 .41%
Real estate secured.............. 1,942 58,891 3.30 171 57,741 1.19
Auto finance..................... 270 9,883 2.74 145 9,598 6.04
MasterCard/Visa.................. 911 20,509 4.44 354 20,441 6.92
Private label.................... 853 17,921 4.76 214 17,626 4.85
Personal non-credit card......... 1,816 19,074 9.52 479 18,928 10.12
------ -------- ----- ------ -------- -----
Total............................ $5,794 $126,305 4.59% $1,363 $124,362 4.38%
====== ======== ===== ====== ======== =====
June 30, 2004
Owned:
First mortgage................... $ 2 $ 29 5.57% $ -- $ 39 3.05%
Real estate secured.............. 1,897 56,033 3.39 142 54,220 1.04
Auto finance..................... 116 5,459 2.12 40 5,197 3.05
MasterCard/Visa.................. 631 10,816 5.83 270 10,913 9.91
Private label.................... 638 12,759 5.00 155 12,249 5.06
Personal non-credit card......... 1,250 14,019 8.92 359 13,571 10.59
------ -------- ----- ------ -------- -----
Total............................ $4,534 $ 99,115 4.57% $ 966 $ 96,189 4.02%
====== ======== ===== ====== ======== =====
Serviced with Limited Recourse:
Real estate secured.............. $ 21 $ 175 11.87% $ -- $ 178 .67%
Auto finance..................... 167 3,877 4.31 76 3,981 7.64
MasterCard/Visa.................. 217 9,345 2.32 115 9,299 4.94
Private label.................... 202 4,723 4.28 59 5,113 4.58
Personal non-credit card......... 587 4,716 12.45 151 4,997 12.11
------ -------- ----- ------ -------- -----
Total............................ $1,194 $ 22,836 5.23% $ 401 $ 23,568 6.81%
====== ======== ===== ====== ======== =====
Managed:
First mortgage................... $ 2 $ 29 5.57% $ -- $ 39 3.05%
Real estate secured.............. 1,918 56,208 3.41 142 54,398 1.04
Auto finance..................... 283 9,336 3.03 116 9,178 5.04
MasterCard/Visa.................. 848 20,161 4.21 385 20,212 7.62
Private label.................... 840 17,482 4.81 214 17,362 4.92
Personal non-credit card......... 1,837 18,735 9.81 510 18,568 11.00
------ -------- ----- ------ -------- -----
Total............................ $5,728 $121,951 4.70% $1,367 $119,757 4.57%
====== ======== ===== ====== ======== =====
--------
(1) Certain percentages may not recompute from the dollar figures presented due
to rounding
15
Household International, Inc.
--------------------------------------------------------------------------------
Reconciliation to GAAP Financial Measures
Credit Quality/Credit Loss Reserves (continued)
Two-Months-and-Over Quarter-to-Date Charge-offs,
Contractual Delinquency Net of Recoveries
--------------------------------------- ---------------------------------
Two-Months-
and-Over Consumer Two-Months-and- Net Average
Contractual Receivables Over Contractual Charge- Consumer Net
Delinquency Outstanding Delinquency(1) offs Receivables Charge-offs(1)
----------- ----------- ---------------- ------- ----------- --------------
(dollars are in millions)
September 30, 2003
Owned:
First mortgage........ $ 4 $ 37 11.65% $ -- $ 38 1.06%
Real estate secured... 2,217 52,769 4.20 116 51,047 .91
Auto finance.......... 79 3,701 2.14 36 3,113 4.62
MasterCard/Visa....... 593 9,892 5.99 209 9,697 8.61
Private label......... 694 12,407 5.59 162 12,107 5.35
Personal non-credit
card................ 1,379 13,850 9.96 374 14,170 10.55
------ -------- ----- ------ -------- -----
Total................. $4,966 $ 92,656 5.36% $ 897 $ 90,172 3.98%
====== ======== ===== ====== ======== =====
Serviced with Limited
Recourse:
Real estate secured... $ 25 $ 214 11.68% $ 1 $ 227 1.94%
Auto finance.......... 242 4,700 5.15 107 4,969 8.61
MasterCard/Visa....... 257 9,927 2.59 135 9,603 5.61
Private label......... 179 4,261 4.21 61 4,241 5.79
Personal non-credit
card................ 586 5,007 11.71 131 4,679 11.22
------ -------- ----- ------ -------- -----
Total................. $1,289 $ 24,109 5.35% $ 435 $ 23,719 7.34%
====== ======== ===== ====== ======== =====
Managed:
First mortgage........ $ 4 $ 37 11.65% $ -- $ 38 1.06%
Real estate secured... 2,242 52,983 4.23 117 51,274 .91
Auto finance.......... 321 8,401 3.82 143 8,082 7.08
MasterCard/Visa....... 850 19,819 4.29 344 19,300 7.12
Private label......... 873 16,668 5.24 223 16,348 5.46
Personal non-credit
card................ 1,965 18,857 10.42 505 18,849 10.72
------ -------- ----- ------ -------- -----
Total................. $6,255 $116,765 5.36% $1,332 $113,891 4.68%
====== ======== ===== ====== ======== =====
--------
(1) Certain percentages may not recompute from the dollar figures presented due
to rounding.
16
Household International, Inc.
--------------------------------------------------------------------------------
Reconciliation to GAAP Financial Measures
Credit Quality/Credit Loss Reserves (continued)
Serviced with
Owned Limited Recourse Managed
------- ---------------- -------
(dollars are in millions)
Real Estate Charge-offs and REO Expense:
Three months ended September 30, 2004
Real estate charge-offs and REO expense................................ $ 189 $ -- $ 189
Average real estate secured receivables................................ 57,570 171 57,741
------- ----- -------
Real estate charge-offs and REO expense as a percentage of average real
estate secured receivables(1)........................................ 1.31% -- 1.31%
======= ===== =======
Three months ended June 30, 2004
Real estate charge-offs and REO expense................................ $ 199 $ -- $ 199
Average real estate secured receivables................................ 54,220 178 54,398
------- ----- -------
Real estate charge-offs and REO expense as a percentage of average real
estate secured receivables(1)........................................ 1.47% .67% 1.47%
======= ===== =======
Three months ended September 30, 2003
Real estate charge-offs and REO expense................................ $ 173 $ 1 $ 174
Average real estate secured receivables................................ 51,047 227 51,274
------- ----- -------
Real estate charge-offs and REO expense as a percentage of average real
estate secured receivables(1)........................................ 1.35% 1.94% 1.36%
======= ===== =======
--------
(1) Certain percentages may not recompute from the dollar figures presented due
to rounding.
17
Household International, Inc.
--------------------------------------------------------------------------------
Reconciliation to GAAP Financial Measures
Credit Quality/Credit Loss Reserves (continued)
Serviced with
Owned Limited Recourse Managed
-------- ---------------- --------
(dollars are in millions)
Credit Loss Reserves:
Three months ended September 30, 2004
Reserves for receivables at beginning of quarter $ 3,795 $ 1,904 $ 5,699
Provision for credit losses..................... 1,123 (232) 891
Charge-offs, net of recoveries.................. (969) (394) (1,363)
Other, net...................................... 4 (32) (28)
-------- ------- --------
Reserves for receivables at end of quarter...... $ 3,953 $ 1,246 $ 5,199
======== ======= ========
Receivables..................................... $106,437 $20,175 $126,612
Credit loss reserves as a percent of receivables 3.71% 6.18% 4.11%
-------- ------- --------
Three months ended June 30, 2004
Reserves for receivables at beginning of quarter $ 3,753 $ 2,159 $ 5,912
Provision for credit losses..................... 997 148 1,145
Charge-offs, net of recoveries.................. (966) (401) (1,367)
Other, net...................................... 11 (2) 9
-------- ------- --------
Reserves for receivables at end of quarter...... $ 3,795 $ 1,904 $ 5,699
======== ======= ========
Receivables..................................... $ 99,432 $22,836 $122,268
Credit loss reserves as a percent of receivables 3.82% 8.34% 4.66%
-------- ------- --------
Three months ended September 30, 2003
Reserves for receivables at beginning of quarter $ 3,659 $ 1,980 $ 5,639
Provision for credit losses..................... 1,001 420 1,421
Charge-offs, net of recoveries.................. (899) (435) (1,334)
Other, net...................................... 18 (11) 7
-------- ------- --------
Reserves for receivables at end of quarter...... $ 3,779 $ 1,954 $ 5,733
======== ======= ========
Receivables..................................... $ 93,028 $24,109 $117,137
Credit loss reserves as a percent of receivables 4.06% 8.10% 4.89%
-------- ------- --------
18
Household International, Inc.
--------------------------------------------------------------------------------
Reconciliation to GAAP Financial Measures
Credit Quality/Credit Loss Reserves (continued)
Serviced with
Owned Limited Recourse Managed
------ ---------------- -------
(dollars are in millions)
Nonperforming Assets:
September 30, 2004
Nonaccrual receivables........................................ $2,891 $ 585 $3,476
Accruing receivables 90 or more days delinquent............... 905 296 1,201
Renegotiated commercial loans................................. 1 -- 1
------ ------ ------
Total nonperforming receivables............................... 3,797 881 4,678
Real estate owned............................................. 601 -- 601
------ ------ ------
Total nonperforming assets.................................... $4,398 $ 881 $5,279
====== ====== ======
Credit loss reserves as a percent of nonperforming receivables 104.1% -- 111.1%
------ ------ ------
June 30, 2004
Nonaccrual receivables........................................ $2,833 $ 673 $3,506
Accruing receivables 90 or more days delinquent............... 850 285 1,135
Renegotiated commercial loans................................. 1 -- 1
------ ------ ------
Total nonperforming receivables............................... 3,684 958 4,642
Real estate owned............................................. 624 -- 624
------ ------ ------
Total nonperforming assets.................................... $4,308 $ 958 $5,266
====== ====== ======
Credit loss reserves as a percent of nonperforming receivables 103.0% -- 122.8%
------ ------ ------
September 30, 2003
Nonaccrual receivables........................................ $3,197 $ 747 $3,944
Accruing receivables 90 or more days delinquent............... 883 305 1,188
Renegotiated commercial loans................................. 2 -- 2
------ ------ ------
Total nonperforming receivables............................... 4,082 1,052 5,134
Real estate owned............................................. 543 -- 543
------ ------ ------
Total nonperforming assets.................................... $4,625 $1,052 $5,677
====== ====== ======
Credit loss reserves as a percent of nonperforming receivables 92.6% -- 111.7%
------ ------ ------
19
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