Regional Management Corp.

Our primary cash needs relate to the funding of our lending activities and, to a lesser extent, expenditures relating to improving our technology infrastructure and expanding and maintaining our branch locations. We have historically financed, and plan to continue to finance, our short-term and long-term operating liquidity and capital needs through a combination of cash flows from operations and borrowings under our debt facilities, including our senior revolving credit facility, revolving warehouse credit facilities, and asset-backed securitization transactions, all of which are described below. We continue to seek ways to diversify our funding sources. As of September 30, 2025, our funded debt-to-equity ratio was 4.3 to 1.0 and stockholders’ equity ratio was 18.3%, compared to 4.1 to 1.0 and 18.7%, respectively, as of December 31, 2024.

Cash and cash equivalents increased to $4.1 million as of September 30, 2025, from $4.0 million as of the prior year-end. We had immediate availability to draw down cash from our revolving credit facilities of $151.3 million and $132.9 million as of September 30, 2025 and the prior year-end, respectively. Our unused capacity on our revolving credit facilities (subject to the borrowing base) was $399.8 million and $466.2 million as of September 30, 2025, and the prior year-end, respectively. Our debt balance was $1.6 billion as of September 30, 2025 compared to $1.5 billion as of the prior year-end.

Based upon anticipated cash flows, we believe that cash flows from operations and our various financing alternatives will provide sufficient financing for debt maturities and operations over the next twelve months, as well as into the future.

From time to time, we have extended the maturity date of and increased the borrowing limits under our senior revolving credit facility. While we have successfully obtained such extensions and increases in the past, there can be no assurance that we will be able to do so if and when needed in the future. As of September 30, 2025 the revolving period maturities of our securitizations and warehouse credit facilities (each as described below within “Financing Arrangements and Restricted Cash Reserve Accounts”) ranged from May 2026 to May 2027, with the exception of securitizations RMIT 2021-1 and RMIT 2022-1, for which the revolving periods ended in February 2024 and February 2025, respectively. We had not exercised our right to redeem the notes of either of these two securitizations as of September 30, 2025. There can be no assurance that we will be able to secure an extension of the warehouse credit facilities or close additional securitization transactions if and when needed in the future.

Dividends and Stock Repurchases.

The Board may in its discretion declare and pay cash dividends on our common stock. The following table sets forth the quarterly dividends declared and paid for the nine months ended September 30, 2025:

While we intend to pay our quarterly dividend for the foreseeable future, all subsequent dividends will be reviewed and declared at the discretion of the Board and will depend on many factors, including our financial condition, earnings, cash flows, capital requirements, level of indebtedness, statutory and contractual restrictions applicable to the payment of dividends, and other considerations that the Board deems relevant. Our dividend payments may change from time to time, and the Board may choose not to continue to declare dividends in the future.

In December 2024, we announced that the Board had authorized a $30.0 million stock repurchase program. The authorization was effective immediately and extends through December 31, 2026. As of September 30, 2025, we had repurchased 0.6 million shares of common stock under this plan at a total cost of $20.2 million, including commissions and estimated excise taxes.

See Note 14, “Subsequent Events” of the Notes to Consolidated Financial Statements in Part I, Item 1, “Financial Statements,” for information regarding our stock repurchase program and cash dividend following the end of the quarter.

Cash Flow.

Operating Activities. Net cash provided by operating activities during the nine months ended September 30, 2025 was $229.0 million, compared to $205.1 million during the prior-year period, a net increase of $23.9 million. The increase in net cash provided was primarily due to the growth of our loan portfolio.

Investing Activities. Investing activities consist of originations and repayments of finance receivables, purchases of intangible assets, and purchases of property and equipment for new and existing branches. Net cash used in investing activities during the nine months ended September 30, 2025 was $328.0 million, compared to $196.4 million during the prior-year period, a net increase in cash used of $131.6 million. The increase in net cash used was primarily driven by increased originations as we grow our loan portfolio, partially offset by increased repayments of finance receivables.

Financing Activities. Financing activities consist of borrowings and payments on our outstanding indebtedness. Net cash provided by financing activities during the nine months ended September 30, 2025 was $71.9 million, compared to $17.0 million used in financing activities during the prior-year period, a net increase in cash provided of $89.0 million. The net increase in cash provided was primarily due to an increase in the net advances on debt instruments of $107.4 million related to increased originations, partially offset by an increase in the repurchases of common stock of $16.5 million.

Financing Arrangements and Restricted Cash Reserve Accounts.

As of September 30, 2025, we had five credit facilities outstanding and, from time to time, we engage in the private offering and sale of asset-backed notes. As part of our overall funding strategy, we have transferred certain finance receivables to affiliated VIEs for asset-backed financing transactions. Our debt arrangements described below, other than our senior revolving credit facility, are issued by each of our RMR and RMIT SPEs, which are considered VIEs under GAAP. These debts are supported by the expected cash flows from the underlying collateralized finance receivables. Collections on these finance receivables are remitted to restricted cash collection accounts, which totaled $88.9 million and $117.1 million as of September 30, 2025 and December 31, 2024, respectively. Our debt arrangements also contain various debt covenants. We were in compliance with all such debt covenants as of September 30, 2025.

Revolving Credit Facilities. The following is a summary of our revolving credit facilities as of September 30, 2025:

Securitizations. The following is a summary of our securitizations as of September 30, 2025:

See Note 14, “Subsequent Events” of the Notes to the Consolidated Financial Statements in Part 1, Item 1, “Financial Statements,” for information regarding the completion of a private offering and sale of $253 million of asset backed notes and the repayment and termination of the RMIT 2021-1 securitization following the end of the quarter.

RMC Reinsurance. Our wholly owned subsidiary, RMC Reinsurance, Ltd., is required to maintain reserves against life insurance policies ceded to it, as determined by the ceding company. These reserves are comprised of restricted cash and restricted AFS investments. As of September 30, 2025, the reserves totaled $23.7 million.