News & Press Releases

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May 2022 Evergreen Bank Group Reports First Quarter Earnings

OAK BROOK, IL., May 4, 2022

First Quarter Earnings

Bancorp Financial, Inc. (the "Company"), the parent company of Evergreen Bank Group (the "Bank" or "Evergreen"), today announced first quarter earnings for 2022.

The Company's net income was $4.9 million for 2022 as compared to $5.1 million for 2021.

  • Net interest income was $14.2 million, representing a net interest margin of 4.85%, as compared to $14.2 million and a margin of 4.75% for the same period in 2021. The Bank's nationwide powersport portfolio continues to drive the strong yield on earning assets.
  • There was no provision for loan losses in the first quarter of 2022 as compared to $0.6 million for 2021.  The allowance for loan losses stands at 1.85%, still significantly elevated over pre- pandemic levels. The Bank has recognized very low losses from Covid and remains cautiously optimistic about continued recovery.
  • Non-interest income at the Bank was $0.5 million for 2022 as compared to $0.6 million in 2021. Non-interest expense was $8.3 million for 2022 as compared to $7.4 million in 2021, primarily due to staffing and infrastructure costs for new digital initiatives.
  • Total assets were $1.21 billion at March 31, 2022, up slightly from $1.20 billion at year-end 2021. Growth in the first quarter was driven by consumer lending areas.  Commercial growth continues to be challenging due to competitive terms on loans in the Chicago market. 

Looking ahead in 2022
"We had solid first quarter results while recording significant technology investments as it relates to our digital and FinTech strategies. We believe these technology enhancements will create increased shareholder value," said Jill Voss, EVP and Chief Financial Officer.

Shareholder Dividend
The Company was excited to again declare a $0.20 dividend per share during the first quarter paid in April to its common shareholders. While capital and earnings continue to be strong, the Company intends to continue to pay a quarterly dividend throughout 2022.

BALANCE SHEETS

 

 

 

Unaudited

 

Audited

Assets

03/31/2022

 

12/31/2021

Cash and cash equivalents

$   136,233,593

 

$    116,536,612

Investments

90,089,385

 

96,113,046

Loans, net

942,722,897

 

951,287,254

Bank owned life insurance

12,756,342

 

12,680,356

Other assets

30,163,462

 

24,179,299

Total Assets

$ 1,211,965,679

 

$ 1,200,796,567

 

Liabilities and Stockholders' Equity

 

 

 

Deposits

$   999,468,647

 

$    994,057,949

Notes Payable

59,400,000

 

57,700,000

Other liabilities

18,411,991

 

14,510,993

Total Liabilities

$ 1,077,280,638

 

$ 1,066,268,942

Stockholders' Equity

$ 134,685,041

 

$ 134,527,625

Total Liabilities and Stockholders' Equity

$ 1,211,965,679

 

$ 1,200,796,567

 

Evergreen Bank Group Capital Ratios:

 

 

 

Common equity tier 1 capital ratio

16.14%

 

15.61%

Tier 1 risk-based capital ratio

16.14%

 

15.61%

Total risk-based capital ratio

17.39%

 

16.87%

Tier 1 leverage ratio

13.61%

 

13.23%

INCOME STATEMENTS

 

Unaudited March

YTD 2022

 

 

Unaudited March

YTD 2021

 

 

 

 

Interest income on loans

$   14,878,216

 

$   16,305,022

Interest income on investments and cash in banks

$        508,090

 

$        412,302

Total Interest Income

$   15,386,306

 

$   16,717,324

Interest expense on deposits

  884,113

 

2,042,112

Interest expense on debt

  305,357

 

  466,554

Total Interest Expense

$     1,189,470

 

$    2,508,666

Net Interest Income

$   14,196,836

 

$  14,208,658

Provision for loan losses

0

 

600,000

Other non interest income

530,230

 

597,393

Other non interest expense

8,293,344

 

7,402,861

Net Income before Taxes

$    6,433,722

 

$    6,803,190

Income tax expense

1,543,556

 

1,693,185

Net Income

$    4,890,166

 

$    5,110 005

Return on Average Assets

1.64%

 

1.69%

Return on Average Equity

14.51%

 

17.83%

Evergreen Bank Group (the "Bank") is an Illinois-chartered community bank wholly-owned by Bancorp Financial, Inc., a Delaware corporation (the "Company"). The Bank was formed in 1999 and became a subsidiary of the Company as a result of a merger transaction during 2007. The Bank is headquartered in Oak Brook, Illinois.

This document contains certain forward-looking statements as defined in applicable federal securities laws. These forward-looking statements describe future plans or strategies and may include the Company's and the Bank's expectations of future results. The Company's and the Bank's ability to predict results or the effect of future plans or strategies or qualitative or quantitative changes is inherently uncertain. Actual results may differ materially from stated expectations.

 

Mar 2022 FreedomRoad Financial celebrates its 15th anniversary and goes racing at the Daytona 200!

OAK BROOK, lL, Mar 4, 2022

On March 7th, FreedomRoad Financial (FRF), a fintech lending division of Evergreen Bank Group, will celebrate 15 years of serving the powersports marketplace!  Since its founding in 2007, FRF has funded over $2.5 billion in powersports loans, and, through its network of over 1,500 dealer partners, has helped over 225,000 customers realize their dream to Get out and Ride!TM.  FRF partners with over 20 Original Equipment Manufacturer (OEM) brands, serving as their retail finance partner and underwriting loans in all 50 states and Puerto Rico. “They say time flies when you’re having fun and, with us being in the ultimate fun business, these 15 years have really been a blur!” said Nat Franklin, Senior VP, who has been with FRF since day one.

FRF is also excited to be on the starting grid of the upcoming Daytona 200 on March 12th. FRF is a major sponsor of Triumph’s efforts to make it back to the top of the podium at the 80th Annual Daytona 200, America’s Most Historic Motorcycle Race.  “When Triumph asked us if we wanted to go racing with them at the Daytona 200, it was an easy decision,” said Tom Collins, Managing Director. “We are proud to have Triumph as our longest tenured OEM relationship as we’ve been their retail finance partner since 2008.”

FRF recently joined the Motorcycle Industry Council and looks to continue to go wide-open in 2022. FRF will bring on additional OEM partners and dealers throughout the year and will introduce upgraded technology and services. With these additional partners and fintech capabilities, FRF is poised to help thousands of new and returning customers nationwide realize the joy of powersports ownership.

Evergreen Bank Group (the “Bank”) is an Illinois-chartered community bank wholly-owned by Bancorp Financial, Inc., a Delaware corporation (the “Company”). The Bank was formed in 1999 and became a subsidiary of the Company as a result of a merger transaction during 2007. The Bank is headquartered in Oak Brook, Illinois.

This document contains certain forward-looking statements as defined in applicable federal securities laws. These forward-looking statements describe future plans or strategies and may include the Company’s and the Bank’s expectations of future results. The Company’s and the Bank’s ability to predict results or the effect of future plans or strategies or qualitative or quantitative changes is inherently uncertain. Actual results may differ materially from stated expectations.

 

Feb 2022 Evergreen Bank Group reports record earnings and provides updates on digital and FinTech strategies.

Evergreen Bank Group, Oak Brook, IL | February 14, 2022

NEWS PROVIDED BY Evergreen Bank Group

Feb 14, 2022, 11:14 ET

OAK BROOK, lll., Feb. 14, 2022 /PRNewswire/ --

Record Earnings

Bancorp Financial, Inc. (the "Company"), the parent company of Evergreen Bank Group (the "Bank" or "Evergreen") today announced record earnings for 2021. The Company's net income was $24.8 million for 2021 as compared to $11.5 million for 2020.

Net interest income was $59.0 million, representing a net interest margin of 4.92%, as compared to $54.6 million and a margin of 4.55% for the same period in 2020. The Bank's nationwide powersport portfolio continues to drive the strong yield on earning assets.

Provision for loan losses was $0.3 million for 2021 as compared to $13.9 million during 2020. The allowance for loan losses stands at 1.91%, still significantly elevated over pre- pandemic levels. The Bank has recognized very low losses from Covid and remains cautiously optimistic about continued recovery.

Non-interest income at the Bank was $3.0 million for 2021 as compared to $2.3 million in 2020. Non-interest expense was $30.0 million for 2021 as compared to $27.9 million in 2020, primarily due to infrastructure costs for the new digital strategy and staffing related to overall growth.

Total assets were $1.20 billion at December 31, 2021, down 3.7% from $1.25 billion from year-end 2020 primarily due to lower loan demand. Commercial lending growth has been challenging as the Bank's primary focus has been on current customers impacted by Covid-19.

Powersport demand is at an all-time high, but 2021 originations were only up slightly as inventories have been lower in 2021 because of supply chain issues. As powersport inventory issues are resolved throughout 2022, pent up demand should result in solid loan growth in 2022. Other lending areas within the Bank have also seen lower growth because of the ongoing pandemic but are also expected to pick up pace throughout 2022.

Looking ahead to 2022 - "While we are projecting strong earnings in 2022, we do not expect net income to reach our 2021 levels. We are projecting some net interest margin pressure as the Fed moves short term rates. Plus, we plan to add more to the provision as we are projecting the record low loan loss rates in 2021 will reverse back to historical loss rate numbers. The provision will also increase as we account for higher loan growth in 2022. In addition, we are committed to aggressive technology investments as it relates to our digital and FinTech strategies. We truly believe the financial institutions with the best technology will create the most shareholder value and long-term profitability," said Jill Voss, EVP and Chief Financial Officer.

Shareholder Dividend

The Company was excited to pay its first quarterly shareholder dividend in 8 years. In December the Board of Directors declared a $.20 dividend per share outstanding that was paid to shareholders of record as of December 31, 2021 in January2022. While capital and earnings continue to be strong, the Company intends to continue to pay a quarterly dividend throughout 2022.

BALANCE SHEETS Unaudited Audited
Assets 12/31/2021 12/31/2020
Cash and cash equivalents $116,536,612 $153,516,636
Investments $96,113,046 $85,362,728
Loans, net $951,287,254 $972,799,291
Bank owned life insurance $12,680,356 $13,088,565
Other assets $24,179,299 $22,181,794
Total Assets $1,200,796,567 $1,246,949,014
Liabilities and Stockholders' Equity    
Deposits $994,057,949 $1,048,619,471
Notes Payable $57,700,000 $63,426,647
Subordinated debt $0 $12,500,000
Other liabilities $14,510,993 $9,558,419
Total Liabilities $1,066,268,942 $1,134,104,537
Stockholders' Equity $134,527,625 $112,844,477
Total Liabilities and Stockholders' Equity $1,200,796,567 $1,246,949,014
Evergreen Bank Group Capital Ratios:    
Common equity tier 1 capital ratio 15.61% 13.07%
Tier 1 risk-based capital ratio 15.61% 13.07%
Total risk-based capital ratio 16.89% 14.33%
Tier 1 leverage ratio 13.23% 10.72%
INCOME STATEMENTS Unaudited YTD
2021
Audited YTD
2020
Interest income on loans $64,454,874 $68,356,649
Interest income on investments
and cash in banks
$1,871,103 $2,450,211
Total Interest Income $66,325,977 $70,806,860
Interest expense on deposits $5,840,556 $14,151,591
Interest expense on debt $1,519,705 $2,047,230
Total Interest Expense $7,360,261 $16,198,821
Net Interest Income $58,965,716 $54,608,039
Provision for loan losses $325,000 $13,900,000
Other non interest income $3,044,165 $2,332,711
Other non interest expense $29,996,559 $27,872,360
Net Income before Taxes $31,688,322 $15,168,390
Income tax expense $6,940,268 $3,669,644
Net Income $24,748,054 $11,498,746
Return on Average Assets 2.03% 1.07%
Return on Average Equity 19.82% 12.14%

Accelerating Digital Strategy and FinTech Integrations

Evergreen will be launching phase one of its robust best-in-class digital banking solution in March 2022. The enhancements will focus on the Evergreen brand with subsequent phases focused on the Bank's powersport divisions, FreedomRoad Financial and Performance Finance. Evergreen partnered with several premier financial technology companies ("FinTechs") to greatly enhance the customer digital banking experience, both via a computer or mobile device. Current and new customers will be able to open deposit accounts on their mobile device or online in just minutes. "We truly believe our new digital solutions and FinTech partnerships that we plan to roll out over the next several quarters will rival any Neobank or Tech-Savvy National Bank," said Darin Campbell, President & CEO.

March 2022 New Digital Banking Launch Will Include:

Digital Account Opening for Deposits – Evergreen will be launching an award winning and entirely digital and fully automated platform – offering customers the ability to open accounts in just over 2 minutes. The solution will also be fully integrated to support the automated onboarding process by combining 120 plus data points related to Know-Your-Customer (KYC) checks to enhance fraud prevention.

Online and Mobile Banking Evergreen will be launching an award winning and entirely digital and fully automated platform – focused on a superior user experience that aligns with the customer's daily life.

Fintech Marketplace – The Evergreen solution will leverage AppXchange and APIs – offering two new fully integrated financial wellness tools:

Insurance App – The award winning and top-rated insurance company digital solution offers the easiest and fastest way for customers to switch to better homeowners and renters insurance options.

Lower Your Bills App – This 4-star service is like having your own personal account manager and will help lower customers' monthly bills. The service will negotiate recurring monthly bills (i.e., internet, cable, satellite, mobile/wireless, home security, and other services), and help cancel unwanted subscriptions (e.g., a monthly shave club).

Personal Financial Management Solution – Evergreen will be launching an award-winning solution that is securely integrated in the new digital banking platform. This best-in-class solution provides customers with a seamless experience for viewing all their data on our single platform. Budgeting, account aggregation, auto-categorization, and debt management tools will be available to customers.

Mobile Wallets Apple Pay and Google Pay are securely connected to the Evergreen debit card - replacing the physical card and cash with an easier, more secure and private payment method.

Mobile Remote Deposit Capture – Evergreen will be launching best-in-class mobile remote deposit capture technology – offering customers the highest mobile check image acquisition rates in the industry.

Bill Pay & Person-to-Person Evergreen will be launching industry-leading payment and transfer solutions – offering customers the latest digital payment technology when paying bills (one-time, future, and recurring) and when transferring money to another individual's account.

"We are extremely excited to launch phase one of our new digital strategy in March. The upgrades we're making over the next 18 months will be robust – stay tuned for phase two and three of our plan as we will be rolling out several industry leading upgrades to our platform," said Dan Inendino, SVP – Head of Digital Banking & Chief Marketing Officer.

"Prelude to phase two will be separate branded solutions for our national powersport lending divisions (FinTechs), FreedomRoad Financial and Performance Finance. We are excited to offer this new technology to our current loan-only customers and the thousands of new customers we add nationally each month. Our ability to seamlessly cross-sell competitive deposit products, along with integrated FinTech Marketplace products, to our large national customer base will only increase customer loyalty and drive additional profitability," said Darin Campbell, President & CEO.

National Digital Lending Strategy:

Loan Origination System (LOS) Enhancements Evergreen plans to launch new enhancements to the current LOS along with several new digital lending applications over the next several quarters – offering original equipment manufacturers (OEMs), dealers, and all consumer customers best-in-class direct and indirect lending options.

"We are laser focused on simplifying the loan process for our dealers and customers. We are adding more features for dealers to instantly make changes from application to funding, offer pre-approved options, mobile device options, advanced contracting, and expanded automated decisioning. We love our dealers, and they are the lifeblood of our business. We are always looking for ways to make their lives easier and help them sell units," said Tom Collins, EVP – Head of Powersport Lending.

FinTech Banking Strategy:

Banking-as-a-Service (BaaS) Evergreen plans to work with a partner to launch a FinTech partnership program – offering banking services for a fee to select FinTechs.

"We don't think there is any question that bank and FinTech partnerships will lead the way to future financial services –traditional banks can ignore the change or take advantage of the tremendous opportunity to unlock a new revenue stream. We plan to partner with a proven platform that can help us manage and scale our program," said Darin Campbell, President & CEO.

Evergreen Bank Group (the "Bank") is an Illinois-chartered community bank wholly-owned by Bancorp Financial, Inc., a Delaware corporation (the "Company"). The Bank was formed in 1999 and became a subsidiary of the Company as a result of a merger transaction during 2007. The Bank is headquartered in Oak Brook, Illinois.

This document contains certain forward-looking statements as deined in applicable federal securities laws. These forward-looking statements describe future plans or strategies and may include the Company's and the Bank's expectations of future results. The Company's and the Bank's ability to predict results or the effect of future plans or strategies or qualitative or quantitative changes is inherently uncertain. Actual results may differ materially from stated expectations.

SOURCE Evergreen Bank Group

 

Oct 2021 Evergreen Bank Group, one of the Chicago area’s most dynamic, independently owned banks, announced today its year-to-date financial results for 2021, key national expansion plans, and industry recognition.

Evergreen Bank Group, Oak Brook, IL | October 27, 2021

Strong Financial Results

Bancorp Financial, Inc. (the “Company”), the parent company of Evergreen Bank Group (the “Bank” or “Evergreen”) today announced strong financial results as of September 30, 2021.  The Company’s net income was $17.843 million for the nine months ended September 30, 2021 as compared to $9.689 million for the same period in 2020. 

  • Net interest income at the Bank for the first nine months of 2021 was $44.266 million, representing a net interest margin of 4.84%, as compared to $40.106 million and a margin of 4.39% for the same period in 2020.  The Bank’s powersport portfolio continues to drive the strong yield on earning assets.
  • Provision for loan losses was $.525 million for the first nine months of 2021 as compared to $8.300 million during the same period in 2020.  The allowance for loan losses stands at 1.99%, still significantly elevated over pre-pandemic levels. The Bank has recognized low losses as a result of Covid and remains cautiously optimistic about continued recovery.
  • Non-interest income at the Bank was $2.496 million for the first nine months of 2021 as compared to $1.744 million in 2020. 
  • Non-interest expense was $22.792 million for the first nine months of 2021 as compared to $20.587 million in 2020, primarily due to infrastructure costs for the new digital strategy and staffing related to overall growth.

Net income for the 2021 calendar year is on a record pace for the bank and the company. “Our robust margin and limited losses have fueled stellar financial results this year”, said Jill Voss, Chief Financial Officer.  “Due to limited loss projections for the remainder of the year, the bank is in a strong position to reverse some of the 2020 allocation for loan losses and still maintain a solid coverage as we are going into the 4th Quarter of 2021.”

Total assets were $1.220 billion on September 30, 2021, down 2.2% from $1.247 billion on December 31, 2020 primarily due to lower loan demand.  Commercial lending growth has been challenging as the primary focus has been on current customers impacted by Covid-19. Additionally, there have been fewer physical contacts and in-person touchpoint opportunities to source new business due to pandemic concerns and social distancing measures. Powersport demand is at an all-time high, but 2021 originations are only up slightly as powersport inventories have been lower in 2021 because of supply chain issues. As powersport inventory issues are resolved throughout 2022, pent up demand should result in substantial loan growth in 2022. Other lending areas within the Bank have also seen lower growth as a result of the ongoing pandemic but are also expected to pick up pace over the next few quarters.

BALANCE SHEETS
Assets Unaudited
9/30/2021
Audited
12/31/2020
Cash and cash equivalents $122,664,620 $153,516,636
Investments 103,788,103 85,362,728
Loans, net 957,687,966 972,799,291
Bank owned life insurance 12,602,613 13,088,565
Other assets 22,816,818 22,181,794
Total Assets $1,219,560,120 $1,246,949,014
Liabilities and Stockholders' Equity
Deposits $1,018,976,911 $1,048,619,471
Notes Payable 56,207,997 63,426,647
Subordinated debt 0 12,500,000
Other liabilities 13,885,762 9,558,419
Total Liabilities $1,089,070,670 $1,134,104,537
Stockholders' Equity $130,489,450 $112,844,477
Total Liabilities and Stockholders' Equity $1,219,560,120 $1,246,949,014
Evergreen Bank Group Capital Ratios:
Common equity tier 1 capital ratio 14.93% 13.07%
Tier 1 risk-based capital ratio 14.93% 13.07%
Total risk-based capital ratio 16.18% 14.33%
Tier 1 leverage ratio 12.81% 10.72%
INCOME STATEMENTS Unaudited YTD
September 2021
Unaudited YTD
September 2020
Interest income on loans 48,930,093 51,069,898
Interest income on investments and cash in banks $1,384,872 $1,988,693
Total Interest Income $50,314,965 $53,058,591
Interest expense on deposits 4,820,733 11,403,401
Interest expense on debt 1,227,971 1,549,335
Total Interest Expense $6,048,704 $12,952,736
Net Interest Income $44,266,261 $40,105,855
Provision for loan losses 525,000 8,300,000
Other non-interest income 2,495,665 1,744,403
Other non-interest expense 22,792,113 20,587,310
Net Income before Taxes $23,444,813 $12,962,948
Income tax expense 5,602,209 3,274,334
Net Income $17,842,604 $9,688,614
Return on Average Assets 1.96% 1.07%
Return on Average Equity 19.58% 12.14%

 

Evergreen Bank Group and Polaris Sales Inc. Renew and Expand Multiyear Retail Financing Program Contract

Evergreen Bank Group and Polaris Sales Inc., recently agreed to a multi-year financing services program agreement, expanding the relationship between the two companies.  The Bank focuses on providing financing to Polaris customers through its Performance Finance division.  Performance Finance is a trademark of Polaris Industries Inc. and Indian Motorcycles International LLC.

Since 2016, Performance Finance has provided Polaris customers with innovative financing solutions through Indian Motorcycle’s independent network of national dealers.  “Our long-standing relationship with Polaris has been a winning combination – and we are extremely excited to expand our relationship by making our premium financing programs available to the large network of Polaris Off-Road dealers. This will position our company for solid growth over the next several years,” said Darin Campbell, President & CEO.

Launching “Best in Class” Digital Strategy

During the remainder of 2021 Evergreen is focused on enhancing its technology capabilities through several initiatives.  Evergreen has partnered with a premier financial technology (“fintech”) company to launch new best-in-class omni-channel online banking, mobile banking, and online account opening solutions across all three of its brands – Evergreen Bank Group, FreedomRoad Financial and Performance Finance.  Each brand will launch new online banking platforms and new mobile apps, which will greatly enhance the customer experience when banking anywhere via a computer or mobile device and allow current and new customers the ability to open a deposit account online in just minutes. 

In addition to convenient features such as mobile check deposit and bill pay, Evergreen has also partnered with a leader in data aggregation to power a new personal financial management tool within the new platform, giving customers a 360-degree view of all their accounts.  The Evergreen Bank Group brand is expected to launch in the first quarter of 2022, with the FreedomRoad Financial and Performance Finance brands launching in mid-2022.  Evergreen will look to expand the product and service offerings within the platform throughout 2022.

To assist in the rollout of the new platform, Evergreen will also be enhancing its marketing and customer service capabilities.  Evergreen is working to launch a premier customer relationship management system, expected in 2022.  “We’re extremely excited about the steps we’ve taken in our digital transformation process,” said Dan Inendino, SVP - Treasurer & Chief Marketing Officer.  “The upgrades we’re making to our banking and servicing platforms will greatly enhance the customer experience and provide a platform for organic growth years into the future.”

“Our ability to raise and service deposits nationally fits perfectly with our business model as we continue to expand our consumer lending presence nationally.  The new platforms will allow the Bank to generate low-cost deposits to fund our growing consumer finance programs and allows for tremendous scalability.” said Darin Campbell, President & CEO.

Awarded Best Places to Work

Evergreen Bank Group was recently named one of the “Best Banks to Work For” by American Banker.  The 2021 award is the sixth time Evergreen has received this honor.  This prestigious award is based largely on employee feedback – along with other data such as company perks, benefits, diversity, and satisfaction with management. “We are very proud of this acknowledgement and truly believe this would not be possible without the organization’s valued employees and associates, “said Darin Campbell, President & CEO.

In addition to this prestigious recognition, Evergreen has also been consistently recognized among the Best Places to Work in Chicago.  Earlier in 2021, the Bank was named by Crain’s Chicago Business as one of its Best Places to Work for the fourth year in a row.

“Our management team puts a great deal of effort into employee satisfaction because we believe in retaining and attracting high-quality staff,” said Jenny Voss, VP - Human Resources. “Our employees are the reason we have earned the reputation of giving our retail and commercial customers outstanding service, and we are working hard to keep it that way!”

Evergreen Bank Group (the “Bank”) is an Illinois-chartered community bank wholly-owned by Bancorp Financial, Inc., a Delaware corporation (the “Company”). The Bank was formed in 1999 and became a subsidiary of the Company as a result of a merger transaction during 2007. The Bank is headquartered in Oak Brook, Illinois. 

This document contains certain forward-looking statements as defined in applicable federal securities laws. These forward-looking statements describe future plans or strategies and may include the Company’s and the Bank’s expectations of future results. The Company’s and the Bank’s ability to predict results or the effect of future plans or strategies or qualitative or quantitative changes is inherently uncertain.  Actual results may differ materially from stated expectations.

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Articles

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What is the difference between an interest rate and the Annual Percentage Rate (APR)?

A loan’s interest rate is the cost you pay each year to borrow money expressed as a percentage. The interest rate does not include fees charged for the loan.

The Annual Percentage Rate (APR) is the cost you pay each year to borrow money, including fees, expressed as a percentage.

The APR is a broader measure of the cost to you of borrowing money since it reflects not only the interest rate but also the fees that you have to pay to get the loan. The higher the APR, the more you’ll pay over the life of the loan.

A loan’s interest rate and APR are two of the most important measures of the price of borrowing money. The federal Truth in Lending Act (TILA) requires lenders to give potential borrowers specific disclosures about important terms, including the APR, before they are legally obligated on the loan. Since all lenders must provide the APR, borrowers can use the APR to compare loans. Just make sure to compare APRs to APRs and not to interest rates. The two terms are not the same.

 

What is a Risk Based Pricing Notice?

The RBP Notice is given to consumers when a measure of risk is used to determine the terms of the loan. Credit score is used to determine which tier a consumer falls into and their subsequent interest rate. The credit score is being used to determine the risk of lending to that consumer and of that consumer failing to pay back the loan.

The purpose of the RBP Notice is to help consumers understand why they may be receiving less favorable terms than others. This notice shows the consumer's credit score and score range, and gives information about where to obtain a free annual credit report. Lenders are required to provide RBP Notices to comply with the Fair Credit Reporting Act (FCRA).

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