Indicate by check mark whether the registrant (1) has filed all reports required to be filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ¨ No x

There were~~117,422,745~~117,917,932 shares of common stock, $0.01 par value outstanding as of ~~January 31,~~April 30, 2007.


	December 31, 2006			June 30, 2006			March 31, 2007			June 30, 2006
ASSETS
Cash and cash equivalents	$	897,386		$	513,240		$	615,395		$	513,240
Finance receivables, net		11,857,385			11,097,008			14,367,447			11,097,008
Restricted cash – securitization notes payable		865,591			860,935			1,144,173			860,935
Restricted cash –credit facilities		149,173			140,042
Restricted cash – credit facilities								194,693			140,042
Credit enhancement assets		6,061			104,624			5,977			104,624
Property and equipment, net		54,796			57,225			63,393			57,225
Deferred income taxes		99,657			78,789			153,521			78,789
Goodwill								200,497			14,435
Other assets		183,211			216,002			139,815			201,567

Total assets	$	14,113,260		$	13,067,865		$	16,884,911		$	13,067,865

LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities:
Credit facilities	$	2,400,881		$	2,106,282		$	3,004,774		$	2,106,282
Securitization notes payable		8,907,498			8,518,849			10,883,909			8,518,849
Convertible senior notes		750,000			200,000			750,000			200,000
Funding payable		56,484			54,623			93,170			54,623
Accrued taxes and expenses		141,548			155,799			188,984			155,799
Other liabilities		14,212			23,426			14,404			23,426

Total liabilities		12,270,623			11,058,979			14,935,241			11,058,979

Commitments and contingencies (Note 10)
Commitments and contingencies (Note 11)

Shareholders’ equity:
Preferred stock, $0.01 par value per share; 20,000,000 shares authorized, none issued
Common stock, $0.01 par value per share; 230,000,000 shares authorized; 172,892,253 and 169,459,291 shares issued		1,729			1,695
Preferred stock, $0.01 par value per share; 20,000,000 shares authorized, none issued Common stock, $0.01 par value per share; 230,000,000 shares authorized; 119,782,596 and 169,459,291 shares issued								1,198			1,695
Additional paid-in capital		1,236,709			1,217,445			47,728			1,217,445
Accumulated other comprehensive income		43,380			74,282			29,497			74,282
Retained earnings		1,809,479			1,639,817			1,913,211			1,639,817

		3,091,297			2,933,239			1,991,634			2,933,239

Treasury stock, at cost (55,607,217 and 42,126,843 shares)		(1,248,660	)		(924,353	)
Treasury stock, at cost (1,880,797 and 42,126,843 shares)								(41,964	)		(924,353	)

Total shareholders’ equity		1,842,637			2,008,886			1,949,670			2,008,886

Total liabilities and shareholders’ equity	$	14,113,260		$	13,067,865		$	16,884,911		$	13,067,865

The accompanying notes are an integral part of these consolidated financial statements.


	Three Months Ended December 31,						Six Months Ended December 31,						Three Months Ended March 31,						Nine Months Ended March 31,
	2006			2005			2006			2005			2007			2006			2007			2006
Revenue
Finance charge income	$	502,217		$	394,075		$	986,574		$	767,811		$	564,104		$	414,440		$	1,550,678		$	1,182,251
Servicing income		979			21,445			8,438			46,786			571			15,006			9,009			61,792
Other income		72,440			32,608			104,245			53,794			34,797			25,658			102,846			70,605
Gain on sale of equity investment														15,801						51,997			8,847

		575,636			448,128			1,099,257			868,391			615,273			455,104			1,714,530			1,323,495

Costs and expenses
Operating expenses		94,095			83,919			182,383			161,784			109,446			89,686			291,829			251,470
Provision for loan losses		174,800			125,865			348,705			291,725			189,028			118,769			537,733			410,494
Interest expense		155,860			101,179			299,331			191,450			186,610			107,106			485,941			298,556
Restructuring charges, net		77			93			386			252			757			1,874			1,143			2,126

		424,832			311,056			830,805			645,211			485,841			317,435			1,316,646			962,646

Income before income taxes		150,804			137,072			268,452			223,180			129,432			137,669			397,884			360,849
Income tax provision		55,378			50,498			98,790			82,573			25,700			50,937			124,490			133,510

Net income		95,426			86,574			169,662			140,607			103,732			86,732			273,394			227,339

Other comprehensive (loss) income
Unrealized losses on credit enhancement assets		(171	)		(4,072	)		(2,781	)		(8,080	)
Unrealized (losses) gains on credit enhancement assets														(275	)		2,969			(3,056	)		(5,111	)
Unrealized (losses) gains on cash flow hedges		(973	)		838			(9,228	)		9,044			(4,597	)		584			(13,825	)		9,628
Increase in fair value of equity investment		6,131			53,359			6,131			53,359
(Decrease) increase in fair value of equity investment														(1,634	)		873			4,497			54,232
Reclassification of gain on sale of equity investment into earnings		(36,196	)		(8,847	)		(36,196	)		(8,847	)		(15,801	)					(51,997	)		(8,847	)
Foreign currency translation adjustment		(4,104	)		(16	)		(4,265	)		4,975			955			(547	)		(3,310	)		4,428
Income tax benefit (provision)		11,442			(15,211	)		15,437			(16,773	)		7,469			(1,644	)		22,906			(18,417	)

Other comprehensive (loss) income		(23,871	)		26,051			(30,902	)		33,678			(13,883	)		2,235			(44,785	)		35,913

Comprehensive income	$	71,555		$	112,625		$	138,760		$	174,285		$	89,849		$	88,967		$	228,609		$	263,252

Earnings per share
Basic	$	0.82		$	0.65		$	1.41		$	1.02		$	0.88		$	0.67		$	2.29		$	1.68

Diluted	$	0.74		$	0.59		$	1.27		$	0.93		$	0.80		$	0.60		$	2.06		$	1.53

Weighted average shares outstanding		115,834,752			133,701,322			120,518,553			138,218,408
Weighted average shares
Basic														117,540,639			129,629,967			119,539,921			135,397,387

Weighted average shares and assumed incremental shares		130,153,556			148,325,483			134,935,826			152,958,115
Diluted														131,166,057			144,954,396			133,693,242			150,332,001

The accompanying notes are an integral part of these consolidated financial statements.


	Six Months Ended December 31,						Nine Months Ended March 31,
	2006			2005			2007			2006
Cash flows from operating activities
Net income	$	169,662		$	140,607		$	273,394		$	227,339
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		19,497			18,129			24,025			27,635
Accretion and amortization of loan fees		(13,959	)		(6,748	)		(17,266	)		(12,535	)
Provision for loan losses		348,705			291,725			537,733			410,494
Deferred income taxes		3,568			(2,084	)		(22,186	)		(22,112	)
Accretion of present value discount		(5,955	)		(22,658	)		(6,394	)		(30,687	)
Stock-based compensation expense		9,321			9,298			14,375			12,690
Gain on sale of available for sale securities		(36,196	)		(8,847	)		(51,997	)		(8,847	)
Other		2,446			(689	)		3,719			314
Changes in assets and liabilities:
Other assets		3,305			9,910			27,174			83,295
Accrued taxes and expenses		(13,355	)		(19,047	)		4,485			28,462

Net cash provided by operating activities		487,039			409,596			787,062			716,048

Cash flows from investing activities
Purchases of receivables		(3,740,828	)		(3,146,643	)		(6,283,184	)		(5,093,811	)
Principal collections and recoveries on receivables		2,631,281			1,952,779			4,252,500			3,109,116
Distributions from gain on sale Trusts		92,709			253,673			92,957			346,136
Purchases of property and equipment		(3,001	)		(2,249	)		(12,737	)		(4,253	)
Sale of property					34,807						34,807
Proceeds from sale of equity investment		44,300			11,992			62,961			11,992
Acquisition of Long Beach, net of cash acquired								(257,813	)
Change in restricted cash – securitization notes payable		(4,629	)		(63,967	)		(162,773	)		(168,884	)
Change in restricted cash – credit facilities		(9,131	)		(70,874	)		(51,387	)		353,445
Change in other assets		1,948			2,583			4,876			3,273

Net cash used by investing activities		(987,351	)		(1,027,899	)		(2,354,600	)		(1,408,179	)

Cash flows from financing activities
Net change in credit facilities		294,599			241,933			695,970			444,160
Issuance of securitization notes payable		2,550,000			2,500,000			4,248,304			3,445,000
Payments on securitization notes payable		(2,163,227	)		(1,791,525	)		(3,476,673	)		(2,745,016	)
Retirement of senior notes					(13,200	)					(13,200	)
Issuance of convertible senior notes		550,000						550,000
Debt issuance costs		(23,914	)		(8,133	)		(28,469	)		(11,889	)
Proceeds from sale of warrants		93,086						93,086
Purchase of call option on common stock		(145,710	)					(145,710	)
Repurchase of common stock		(323,964	)		(398,929	)		(323,964	)		(422,046	)
Net proceeds from issuance of common stock		43,226			9,181			47,864			24,148
Other net changes		12,521			(484	)		13,198			6,365

Net cash provided by financing activities		886,617			538,843			1,673,606			727,522

Net increase (decrease) in cash and cash equivalents		386,305			(79,460	)
Net increase in cash and cash equivalents								106,068			35,391
Effect of Canadian exchange rate changes on cash and cash equivalents		(2,159	)		2,104			(3,913	)		1,908
Cash and cash equivalents at beginning of period		513,240			663,501			513,240			663,501

Cash and cash equivalents at end of period	$	897,386		$	586,145		$	615,395		$	700,800

The accompanying notes are an integral part of these consolidated financial statements.

The consolidated financial statements include our accounts and the accounts of our wholly-owned subsidiaries, including certain special purpose financing trusts utilized in securitization transactions (“Trusts”) which are considered variable interest entities. All significant intercompany transactions and accounts have been eliminated in consolidation.

The consolidated financial statements as of ~~December~~March 31, 2007 and June 30, 2006, and for the three and ~~six~~nine months ended ~~December~~March 31, ~~2006~~2007 and ~~2005,~~2006, are unaudited, and in management’s opinion include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results for such interim periods. The results for interim periods are not necessarily indicative of results for a full year.

The interim period consolidated financial statements, including the notes thereto, are condensed and do not include all disclosures required by generally accepted accounting principles in the United States of America. These interim period financial statements should be read in conjunction with our consolidated financial statements that are included in our Annual Report on Form 10-K for the year ended June 30, 2006.

The fair value of stock-based compensation granted or modified during the ~~three and six~~nine months ended ~~December~~March 31, ~~2006~~2007 and ~~2005,~~2006, was estimated using the Black-Scholes option-pricing model with the following weighted average assumptions:


	Three Months Ended December 31,				Six Months Ended December 31,				Nine Months Ended March 31,
	2006		2005		2006		2005		2007		2006
Expected dividends	0		0		0		0		0		0
Expected volatility	32.6	%	38.4	%	32.6	%	38.4	%	32.6	%	38.4	%
Risk-free interest rate	4.9	%	4.3	%	4.9	%	4.3	%	4.9	%	4.3	%
Expected life	1.2 years		3.1 years		1.2 years		3.1 years		1.2 years		3.1 years

“Accounting for Derivative Instruments and Hedging Activities”, and SFAS 140, “Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities”. SFAS 155 (i) permits the fair value remeasurement for any hybrid financial instrument that contains an embedded derivative that otherwise would require bifurcation, (ii) clarifies which interest-only strips and principal-only strips are not subject to the requirement of SFAS 133, (iii) establishes a requirement to evaluate interests in securitized financial assets to identify interests that are freestanding derivatives or that are hybrid financial instruments that contain an embedded derivative requiring bifurcation, (iv) clarifies that concentrations of credit risk in the form of subordination are not embedded derivatives and (v) amends SFAS 140 to eliminate the prohibition on a qualifying special purpose entity from holding a derivative financial instrument that pertains to a beneficial interest other than another derivative financial instrument. SFAS 155 is effective for all financial instruments acquired or issued after the beginning of our fiscal year ending June 30, 2008. Management is currently evaluating the impact of the statement; however it is not expected to have a material impact on our consolidated financial position, results of operations or cash flows.

In March 2006, the FASB issued SFAS No. 156, “Accounting for Servicing of Financial Assets – an amendment of FASB Statement No. 140” (“SFAS 156”). SFAS 156 requires an entity to recognize a servicing asset or servicing liability each time it undertakes an obligation to service a financial asset by entering into a servicing contract in specific situations. Additionally, the servicing asset or servicing liability shall be initially measured at fair value, if practicable. SFAS 156 permits an entity to choose either the amortization method or fair value measurement method for subsequent measurement of the servicing asset or servicing liability. SFAS 156 is effective for our fiscal year ending June 30, 2008. Management is currently evaluating the impact of the statement; however it is not expected to have a material impact on our consolidated financial position, results of operations or cash flows.

In July 2006, the FASB issued FASB Interpretation No. 48 (“FIN 48”), “Accounting for Uncertainty in Income Taxes - an interpretation of FASB Statement 109.” FIN 48 prescribes a comprehensive model for recognizing, measuring, presenting and disclosing in the financial statements tax positions taken or expected to be taken on a tax return, including a decision whether to file or not to file in a particular jurisdiction. FIN 48 is effective for our fiscal year ending June 30, 2008. Management is currently evaluating the impact of the adoption of FIN 48.

In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements” (“SFAS 157”), which defines fair value, establishes a framework for measuring

fair value under GAAP and expands disclosures about fair value measurements. SFAS 157 requires companies to disclose the fair value of its financial instruments according to a fair value hierarchy. Additionally, companies are required to provide certain disclosures regarding instruments within the hierarchy, including a reconciliation of the beginning and ending balances for each major category of assets and liabilities. SFAS 157 applies to other accounting pronouncements that require or permit fair value measurements. SFAS 157 is effective for our fiscal year ending June 30, 2009. Management is currently evaluating the impact of the statement; however it is not expected to have a material impact on our consolidated financial position, results of operations or cash flows.

In February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities” (“SFAS 159”), which provides the option to report certain financial assets and liabilities at fair value, with the intent to mitigate volatility in financial reporting that can occur when related assets and liabilities are recorded on different bases. SFAS 159 also amends SFAS No. 115, “Accounting for Certain Investments in Debt and Equity Securities,” by providing the option to record unrealized gains and losses on held-for-sale and held-to-maturity securities currently. SFAS 159 is effective for our fiscal year ending June 30, 2009. Management is currently evaluating the impact of the statement; however it is not expected to have a material impact on our consolidated financial position, results of operations or cash flows.

On January 1, 2007, we acquired the stock of Long Beach Acceptance Corporation (“LBAC”), the auto finance subsidiary of ACC Capital Holdings. The total consideration in the all-cash transaction, including transaction costs, was approximately $287.7 million. The fair value of the net assets acquired was approximately $96.1 million, which resulted in goodwill of approximately $191.6 million. LBAC serves auto dealers in 34 states offering auto finance products primarily to consumers with near prime credit scores.

The results of operations of LBAC subsequent to the acquisition are included in our consolidated statements of income and comprehensive income. The following unaudited proforma financial information presents a summary of consolidated results of operations of our company as if the acquisition had occurred at the beginning of the periods presented (dollars in thousands except for per share data):

These unaudited proforma results have been prepared for comparative purposes only. These results may not be indicative of the results of operations that actually would have resulted had this acquisition occurred at the beginning of the periods presented.


	December 31, 2006			June 30, 2006			March 31, 2007			June 30, 2006
Finance receivables unsecuritized, net of fees	$	2,815,945		$	2,415,000		$	3,519,524		$	2,415,000
Finance receivables securitized, net of fees		9,732,980			9,360,665			11,604,383			9,360,665
Less nonaccretable acquisition fees		(178,405	)		(203,128	)		(141,474	)		(203,128	)
Less allowance for loan losses		(513,135	)		(475,529	)		(614,986	)		(475,529	)

	$	11,857,385		$	11,097,008		$	14,367,447		$	11,097,008

Finance receivables securitized represent receivables transferred to our special purpose finance subsidiaries in securitization transactions accounted for as secured financings. Finance receivables unsecuritized include ~~$2,579.3~~$3,252.1 million and $2,227.3 million pledged under our credit facilities as of ~~December~~March 31, 2007 and June 30, 2006, respectively.

Finance receivables are collateralized by vehicle titles and we have the right to repossess the vehicle in the event the consumer defaults on the payment terms of the contract.

The accrual of finance charge income has been suspended on ~~$622.5~~$505.1 million and $574.8 million of delinquent finance receivables as of ~~December~~March 31, 2007 and June 30, 2006, respectively.

Finance contracts are generally purchased by us from auto dealers without recourse, and accordingly, the dealer usually has no liability to us if the consumer defaults on the contract. Depending upon the contract structure and consumer credit attributes, we may pay dealers a participation fee or we may charge dealers a non-refundable acquisition fee when purchasing individual finance contracts. We record the amortization of participation fees to finance charge income using the effective interest rate method. We record the accretion of acquisition fees on loans purchased subsequent to June 30, 2004, to finance charge income using the effective interest method. We recorded acquisition fees on loans purchased prior to July 1, 2004, as nonaccretable fees available to cover losses inherent in the loan portfolio. Additionally,

we record a discount on finance receivables repurchased upon the exercise of a ~~cleanup~~clean-up call option from our gain on sale securitization transactions and account for such discounts as nonaccretable discounts.


	Three Months Ended December 31,						Six Months Ended December 31,						Three Months Ended March 31,						Nine Months Ended March 31,
	2006			2005			2006			2005			2007			2006			2007			2006
Balance at beginning of period	$	203,474		$	203,687		$	203,128		$	199,810		$	178,405		$	204,901		$	203,128		$	199,810
Purchases of receivables		1,711			6,021			9,195			13,610
Repurchase of receivables																	6,800			9,195			20,410
Net charge-offs		(26,780	)		(4,807	)		(33,918	)		(8,519	)		(36,931	)		(7,157	)		(70,849	)		(15,676	)

Balance at end of period	$	178,405		$	204,901		$	178,405		$	204,901		$	141,474		$	204,544		$	141,474		$	204,544


	Three Months Ended December 31,						Six Months Ended December 31,						Three Months Ended March 31,						Nine Months Ended March 31,
	2006			2005			2006			2005			2007			2006			2007			2006
Balance at beginning of period	$	494,708		$	401,807		$	475,529		$	341,408		$	513,135		$	404,136		$	475,529		$	341,408
Acquisition of Long Beach														41,009						41,009
Provision for loan losses		174,800			125,865			348,705			291,725			189,028			118,769			537,733			410,494
Net charge-offs		(156,373	)		(123,536	)		(311,099	)		(228,997	)		(128,186	)		(114,962	)		(439,285	)		(343,959	)

Balance at end of period	$	513,135		$	404,136		$	513,135		$	404,136		$	614,986		$	407,943		$	614,986		$	407,943

A summary of our securitization activity and cash flows from special purpose entities used for securitizations is as follows (in thousands):


	Three Months Ended December 31,				Six Months Ended December 31,				Three Months Ended March 31,				Nine Months Ended March 31,
	2006		2005		2006		2005		2007		2006		2007		2006
Receivables securitized	$	601,800	$	1,513,514	$	2,975,741	$	2,702,705	$	1,919,503	$	1,000,002	$	4,895,244	$	3,702,707
Net proceeds from securitization				1,400,000		2,550,000		2,500,000		1,698,304		945,000		4,248,304		3,445,000
Servicing fees:
Sold		315		10,450		2,483		24,585		132		6,977		2,615		31,562
Secured financing (a)		63,243		53,970		125,361		104,887		74,970		56,505		200,331		161,392
Distributions:
Sold		16,692		110,655		92,709		253,673		248		92,463		92,957		346,136
Secured financing		200,553		143,059		415,637		296,174		182,260		147,399		597,897		443,573

As of ~~December~~March 31, 2007 and June 30, 2006, we were servicing ~~$9,777.3~~$11,642.1 million and $9,795.1 million, respectively, of finance receivables that have been sold or transferred in securitization transactions.

Credit enhancement assets represent the present value of our retained interests in securitizations accounted for as sales. Credit enhancement assets consist of the following (in thousands):


	December 31, 2006 (a)		June 30, 2006		March 31, 2007 (a)		June 30, 2006
Interest-only receivables from Trusts	$	671	$	3,645	$	325	$	3,645
Investments in Trust receivables				41,018				41,018
Restricted cash – gain on sale Trusts		5,390		59,961		5,652		59,961

	$	6,061	$	104,624	$	5,977	$	104,624

A summary of activity in the credit enhancement assets is as follows (in thousands):


	Three Months Ended December 31,						Six Months Ended December 31,						Three Months Ended March 31,						Nine Months Ended March 31,
	2006			2005			2006			2005			2007			2006			2007			2006
Balance at beginning of period	$	24,075		$	399,015		$	104,624		$	541,790		$	6,061		$	291,148		$	104,624		$	541,790
Distributions from Trusts		(16,692	)		(110,655	)		(92,709	)		(253,673	)		(248	)		(92,463	)		(92,957	)		(346,136	)
Receivables repurchased under clean-up call options		(1,659	)		(3,793	)		(8,155	)		(11,288	)					(5,672	)		(8,155	)		(16,960	)
Accretion of present value discount		305			9,272			1,925			18,586			297			6,595			2,222			25,181
Other-than-temporary impairment											(457	)											(457	)
Change in unrealized gain		32			(2,690	)		376			(4,048	)		(133	)		3,600			243			(448	)
Foreign currency translation adjustment					(1	)					238												238

Balance at end of period	$	6,061		$	291,148		$	6,061		$	291,148		$	5,977		$	203,208		$	5,977		$	203,208

Significant assumptions used in measuring the estimated fair value of credit enhancement assets related to the gain on sale Trusts at the balance sheet dates are as follows:


	December 31, 2006		June 30, 2006		March 31, 2007	June 30, 2006
Cumulative credit losses	2.2%	(a)	12.5% - 14.3%	(b)	2.2% (a)	12.5% - 14.3% (b)

Discount rate used to estimate present value:
Interest-only receivables from Trusts	14.0	%	14.0	%	14.0%	14.0%
Investments in Trust receivables	n/a		9.8	%	n/a	9.8%
Restricted cash	9.8	%	9.8	%	9.8%	9.8%

We have not presented the expected weighted average life and prepayment assumptions used in measuring the fair value of credit enhancement assets due to the stability of these two attributes over time. The majority of our prepayment experience relates to defaults that are considered in the

cumulative credit loss assumption. Our voluntary prepayment experience on our gain on sale receivables portfolio typically has not fluctuated significantly with changes in market interest rates or other economic or market factors. The weighted average life of the pools of loans are driven more by the default assumption than the voluntary prepayment rate assumption and therefore the weighted average life is not meaningful.

We held an equity investment in DealerTrack Holdings, Inc. (“DealerTrack”), a leading provider of on-demand software and data solutions that utilizes the internet to link automotive dealers with banks, finance companies, credit unions and other financing sources. We owned ~~689,881 and~~ 2,644,242 shares of DealerTrack with a market value of ~~$29.42 and~~ $22.11 per share at ~~December 31 and~~ June 30, ~~2006, respectively.~~2006. This equity investment iswas classified as available for sale, and changes in its market value ~~are~~were reflected in other comprehensive income. At ~~December 31 and~~ June 30, 2006, the investment iswas included in other assets on the consolidated balance sheets and iswas valued at ~~$20.3 million and~~ $58.5 ~~million, respectively.~~million. Included in accumulated other comprehensive income on the consolidated balance sheets ~~is $17.4 million and~~was $47.5 million in unrealized gains related to our investment in DealerTrack at ~~December 31 and~~ June 30, ~~2006, respectively.~~2006.

In October 2006, DealerTrack completed a secondary public offering of its common stock. As part of the offering, we sold 1,954,361 shares for net proceeds of $22.67 per share, resulting in a $36.2 million ~~pre-tax~~ gain.

In January 2007, we sold our remaining investment in DealerTrack, consisting of 689,881 shares, for net proceeds of $27.05 per share, resulting in a $15.8 million ~~pre-tax~~ gain.


	March 31, 2007		June 30, 2006
Commercial paper facility	$	842,103	$	358,800
Medium term note facility		750,000		650,000
Repurchase facility		458,812		482,628
Near prime facility		252,885		293,394
Bay View credit facility		591,976		133,180
Bay View receivables funding facility				188,280
Long Beach credit facility		108,998

	$	3,004,774	$	2,106,282

Further detail regarding terms and availability of the credit facilities as of ~~December~~March 31, ~~2006,~~2007, follows (in thousands):


Maturity	Facility Amount		Advances Outstanding		Finance Receivables Pledged		Restricted Cash Pledged (e)		Facility Amount		Advances Outstanding		Finance Receivables Pledged		Restricted Cash Pledged (d)
Commercial paper facility:
October 2009 (a)	$	2,500,000	$	386,087	$	442,925	$	4,425	$	2,500,000	$	842,103	$	969,744	$	9,609
Medium term note facility:
October 2009 (a)(b)		750,000		750,000		807,636		18,761		750,000		750,000		795,506		29,221
Repurchase facility:
August 2007 ~~(c)~~(a)		600,000		550,022		592,594		28,042		500,000		458,812		506,922		27,835
Near prime facility:
July 2007 (a)		400,000		234,383		240,314		2,441		400,000		252,885		257,822		2,630
Bay View credit facility:
September 2007 ~~(d)~~(c)		650,000		480,389		495,866		6,144		650,000		591,976		601,463		7,457
Long Beach credit facility:
September 2007 (a)										600,000		108,998		120,661

	$	4,900,000	$	2,400,881	$	2,579,335	$	59,813	$	5,400,000	$	3,004,774	$	3,252,118	$	76,752

~~Our~~Generally, our credit facilities are administered by agents on behalf of institutionally managed commercial paper or medium term note conduits. Under these funding agreements, we transfer finance receivables to our special purpose finance subsidiaries. These subsidiaries, in turn, issue notes to the agents, collateralized by such finance receivables and cash. The agents provide funding under the notes to the subsidiaries pursuant to an advance formula, and the subsidiaries forward the funds to us in consideration for the transfer of finance receivables. While these subsidiaries are included in our consolidated financial statements, these subsidiaries are separate legal entities and the finance receivables and other assets held by these subsidiaries are legally owned by these subsidiaries and are not available to our creditors or our other subsidiaries. Advances under the funding agreements bear interest at commercial paper, LIBOR or prime rates plus specified fees depending upon the source of funds provided by the agents. The Long Beach credit facility is a revolving agreement with a bank under which we may borrow up to $600.0 million subject to a defined borrowing base.

We are required to hold certain funds in restricted cash accounts to provide additional collateral for borrowings under certain of the facilities. Additionally, certain funding agreements contain various covenants requiring minimum financial ratios, asset quality and portfolio performance ratios (portfolio net loss and delinquency ratios, and pool level cumulative net loss ratios) as well as limits on deferment levels. Failure to meet any of these covenants could result in an event of default under these agreements. If an event of default occurs under these agreements, the lenders could elect to declare all amounts outstanding under these agreements to be immediately due and payable, enforce

their interests against collateral pledged under these agreements or restrict our ability to obtain additional borrowings under these agreements. As of ~~December~~March 31, ~~2006,~~2007, we were in compliance with all covenants in our credit facilities.

Debt issuance costs are being amortized to interest expense over the expected term of the credit facilities. Unamortized costs of ~~$7.4~~$6.7 million and $5.8 million as of ~~December~~March 31, 2007 and June 30, 2006, respectively, are included in other assets on the consolidated balance sheets.

Securitization notes payable represents debt issued by us in securitization transactions accounted for as secured financings. Debt issuance costs are being amortized to interest expense over the expected term of the securitizations; accordingly, unamortized costs of ~~$19.7~~$20.1 million and $21.4 million as of ~~December~~March 31, 2007 and June 30, 2006, respectively, are included in other assets on the consolidated balance sheets.

Securitization notes payable as of ~~December~~March 31, ~~2006,~~2007, consists of the following (dollars in thousands):


Transaction	Maturity Date (b)	Original Note Amount		Original Weighted Average Interest Rate		Receivables Pledged		Note Balance		Maturity Date (d)	Original Note Amount		Original Weighted Average Interest Rate		Receivables Pledged		Note Balance
2003-A-M	November 2009	$	1,000,000	2.6	%	$	127,139	$	115,085
2003-B-X	January 2010		825,000	2.3	%		116,797		106,489	January 2010	$	825,000	2.3	%	$	93,473	$	85,998
2003-C-F	May 2010		915,000	2.8	%		132,540		116,817	May 2010		915,000	2.8	%		106,143		92,828
2003-D-M	August 2010		1,200,000	2.3	%		234,061		207,186	August 2010		1,200,000	2.3	%		193,583		174,128
2004-A-F	February 2011		750,000	2.3	%		163,199		143,549	February 2011		750,000	2.3	%		136,554		121,222
2004-B-M	March 2011		900,000	2.2	%		227,199		200,016	March 2011		900,000	2.2	%		191,655		170,995
2004-1	July 2010		575,000	3.7	%		197,422		143,244	July 2010		575,000	3.7	%		168,324		123,358
2004-C-A	May 2011		800,000	3.2	%		291,402		256,064	May 2011		800,000	3.2	%		251,775		224,707
2004-D-F	July 2011		750,000	3.1	%		299,751		269,540	July 2011		750,000	3.1	%		259,264		235,261
2005-A-X	October 2011		900,000	3.7	%		399,644		356,309	October 2011		900,000	3.7	%		348,056		314,337
2005-1	May 2011		750,000	4.5	%		363,390		279,751	May 2011		750,000	4.5	%		317,041		240,024
2005-B-M	May 2012		1,350,000	4.1	%		740,053		661,103	May 2012		1,350,000	4.1	%		652,133		583,892
2005-C-F	June 2012		1,100,000	4.5	%		681,959		620,971	June 2012		1,100,000	4.5	%		603,437		549,826
2005-D-A	November 2012		1,400,000	4.9	%		972,259		893,509	November 2012		1,400,000	4.9	%		861,876		794,316
2006-1	May 2013		945,000	5.3	%		715,042		659,345	May 2013		945,000	5.3	%		635,895		575,103
2006-RM	January 2014		1,200,000	5.4	%		1,232,384		1,199,845	January 2014		1,200,000	5.4	%		1,238,016		1,199,865
2006-A-F	September 2013		1,350,000	5.6	%		1,269,557		1,183,083	September 2013		1,350,000	5.6	%		1,141,990		1,047,505
2006-B-G	September 2013		1,200,000	5.2	%		1,223,684		1,143,212	September 2013		1,200,000	5.2	%		1,114,640		1,035,513
2007-A-X										October 2013		1,200,000	5.2	%		1,219,959		1,145,670
BV2005-LJ-1 (a)	May 2012		232,100	5.1	%		106,449		107,758	May 2012		232,100	5.1	%		94,355		96,905
BV2005-LJ-2 (a)	February 2014		185,596	4.6	%		98,301		100,411	February 2014		185,596	4.6	%		87,300		90,205
BV2005-3 (a)	June 2014		220,107	5.1	%		140,748		144,211	June 2014		220,107	5.1	%		126,392		131,110
LB2003-B (a)										February 2010		250,000	1.8	%		26,369		26,419
LB2003-C (a)										April 2010		250,000	2.6	%		38,374		38,593
LB2004-A (a)										July 2010		300,000	2.3	%		57,850		59,213
LB2004-B (a)										April 2011		250,000	3.5	%		61,676		62,641
LB2004-C (a)										July 2011		350,000	3.5	%		117,236		113,449
LB2005-A (a)										April 2012		350,000	4.1	%		149,557		142,790
LB2005-B (a)										June 2012		350,000	4.4	%		184,383		176,169
LB2006-A (a)										May 2013		450,000	5.4	%		308,832		321,607
LB2006-B (a)										September 2013		500,000	5.2	%		415,021		411,956
LB2007-A (b)(c)										January 2014		498,304	5.0	%		403,224		498,304

		$	18,547,803			$	9,732,980	$	8,907,498		$	22,296,107			$	11,604,383	$	10,883,909

At the time of securitization of finance receivables, we are required to pledge assets equal to a specified percentage of the securitization pool to support the securitization transaction. Typically, the assets pledged consist of cash deposited to a restricted account and additional receivables delivered to the Trust, which create overcollateralization. The securitization transactions require the percentage of assets pledged to support the transaction to increase until a specified level is attained. Excess cash flows generated by the Trusts are added to the restricted cash account or used to pay down outstanding debt in the Trusts, creating overcollateralization

until the targeted percentage level of assets has been reached. Once the targeted percentage level of assets is reached and maintained, excess cash flows generated by the Trusts are released to us as distributions from Trusts. Additionally, as the balance of the securitization pool declines, the amount of pledged assets needed to maintain the required percentage level is reduced. Assets in excess of the required percentage are also released to us as distributions from Trusts.

With respect to our securitization transactions covered by a financial guaranty insurance policy, agreements with the insurers provide that if portfolio performance ratios (delinquency, cumulative default or cumulative net loss triggers) in a Trust’s pool of receivables exceed certain targets, the specified restricted cash requirements would be increased.

Agreements with our financial guaranty insurance providers contain additional specified targeted portfolio performance ratios. If, at any measurement date, the targeted portfolio performance ratios with respect to any insured Trust were to exceed these additional levels, provisions of the agreements permit our financial guaranty insurance providers to terminate our servicing rights to the receivables sold to that Trust.

Convertible senior notes as of ~~December~~March 31, ~~2006,~~2007, consist of the following (dollars in thousands):


Issue Date	Interest Rate		Maturity Date	Note Balance		Interest Rate		Maturity Date	Note Balance
November 2003	1.75	%	November 2023	$	200,000	1.75	%	November 2023	$	200,000
September 2006	0.75	%	September 2011		275,000	0.75	%	September 2011		275,000
September 2006	2.125	%	September 2013		275,000	2.125	%	September 2013		275,000

				$	750,000				$	750,000

Debt issuance costs relating to convertible senior notes are being amortized to interest expense over the expected term of the notes; unamortized costs of ~~$14.4~~$13.7 million and $2.5 million are included in other assets on the consolidated balance sheets as of ~~December~~March 31, 2007 and June 30, 2006, respectively.

notes and 2) to the extent the conversion value exceeds the principal amount of the notes, shares of our common stock. The notes are convertible only in the following circumstances: 1) if the closing sale price of our common stock exceeds 130% of the conversion price during specified periods set forth in the indentures under which the notes were issued, 2) if the average trading price per $1,000 principal amount of the notes is less than or equal to 98% of the average conversion value of the notes during specified periods set forth in the indentures under which the notes were issued or 3) upon the occurrence of specific corporate transactions set forth in the indentures under which the notes were issued. In connection with the issuance of the notes, we filed a shelf registration statement relating to the resale of the notes, the subsidiary guarantees and the shares of common stock into which the notes are convertible. If the registration statement ceases to remain effective, we will be required to pay additional interest to the noteholders during the time that the registration statement is not effective at a rate of 0.5% per annum through September 2008.

In connection with the issuance of these convertible senior notes, we used net proceeds of $246.8 million to purchase 10,109,500 shares of our common stock.

In conjunction with the issuance of the convertible senior notes, we purchased call options that entitle us to purchase shares of our common stock in an amount equal to the number of shares issued upon conversion of the notes at $28.07 per share and $30.51 per share for the notes due in 2011 and 2013, respectively. These call options are expected to allow us to offset the dilution of our shares if the conversion feature of the convertible senior notes is exercised.

We also sold warrants to purchase 9,796,408 shares of our common stock at $35 per share and 9,012,713 shares of our common stock at $40 per share for the notes due in 2011 and 2013, respectively. In no event are we required to deliver a number of shares in connection with the exercise of these warrants in excess of twice the aggregate number of shares initially issuable upon the exercise of the warrants.

We have analyzed the conversion feature, call option and warrant transactions under Emerging Issues Task Force Issue No. 00-19, “Accounting for Derivative Financial Instruments Indexed to and Potentially Settled In a Company’s Own Stock,” and determined they meet the criteria for classification as equity transactions. As a result, both the cost of the call options and the proceeds

of the warrants are reflected in additional paid-in capital on our consolidated balance sheets, and we will not recognize subsequent changes in their fair value.

As of ~~December~~March 31, 2007, we had interest rate swap agreements associated with our securitization Trusts and our medium term note facility with underlying notional amounts of $1,443.0 million. As of June 30, 2006, we had interest rate swap agreements associated with our securitization Trusts, our medium term

note facility and a portion of our Bay View Acceptance Corp. portfolio with underlying notional amounts of ~~$1,149.6 million and~~ $1,293.8 ~~million, respectively.~~million. The fair value of our interest rate swap agreements of ~~$7.2~~$2.4 million and $18.7 million as of ~~December~~March 31, 2007 and June 30, 2006, respectively, are included in other assets on the consolidated balance sheets. Interest rate swap agreements designated as hedges had unrealized gains of ~~$6.0~~$1.4 million and $15.2 million included in accumulated other comprehensive income as of ~~December~~March 31, 2007 and June 30, 2006, respectively. The ineffectiveness related to the interest rate swap agreements designated as hedges was not material for the three and ~~six month periods~~nine months ended ~~December~~March 31, ~~2006~~2007 and ~~2005.~~2006. We estimate approximately ~~$4.8~~$1.4 million of unrealized gains included in other comprehensive income will be reclassified into earnings within the next twelve months.

As of ~~December~~March 31, 2007 and June 30, 2006, we had interest rate cap agreements with underlying notional amounts of ~~$4,729.4~~$5,683.5 million and $3,733.3 million, respectively. The fair value of our interest rate cap agreements purchased by our special purpose finance subsidiaries of ~~$8.4~~$9.3 million and $15.4 million as of ~~December~~March 31, 2007 and June 30, 2006, respectively, are included in other assets on the consolidated balance sheets. The fair value of our interest rate cap agreements sold by us of ~~$8.2~~$9.2 million and $14.8 million as of ~~December~~March 31, 2007 and June 30, 2006, respectively, are included in other liabilities on the consolidated balance sheets. The interest rate cap agreements have not been designated as hedges for accounting purposes.

Under the terms of our derivative financial instruments, we are required to pledge certain funds to be held in restricted cash accounts as collateral for the outstanding derivative transactions. As of ~~December~~March 31, 2007 and June 30, 2006, these restricted cash accounts totaled ~~$11.3~~$8.8 million and $13.2 million, respectively, and are included in other assets on the consolidated balance sheets.

The payments of principal and interest on our convertible senior notes are guaranteed by certain of our subsidiaries. The carrying value of the convertible senior notes was $750.0 million and $200.0 million as of ~~December~~March 31, 2007 and June 30, 2006, respectively. See guarantor consolidating financial statements in Note ~~16.~~17.

against dealers. The damages and penalties claimed by consumers in these types of matters can be substantial. The relief requested by the plaintiffs varies but can include requests for compensatory, statutory and punitive damages. We believe that we have taken prudent steps to address and mitigate the litigation risks associated with our business activities.

On February 27, 2003, we were served with a shareholder’s derivative action filed in the United States District Court for the Northern District of Texas, Fort Worth Division, entitled Mildred Rosenthal, derivatively and on behalf of nominal defendant AmeriCredit Corp. v. Clifton H. Morris, Jr., et al. A second shareholder derivative action was filed in the District Court of Tarrant County, Texas 48^th Judicial District, on August 19, 2003, entitled David Harris, derivatively and on behalf of nominal defendant AmeriCredit Corp. v. Clifton H. Morris, Jr., et al. Both of these shareholder derivative actions allege, among other complaints, that certain of our officers and directors breached their respective fiduciary duties by causing us to make improper deferments, violate federal and state securities laws and issue misleading financial statements. The substantive allegations include, among other things, that deferments were improperly granted by us to avoid delinquency triggers in securitization transactions and enhance cash flows and to incorrectly report charge-offs and delinquency percentages, thereby causing us to misrepresent our financial performance. A special litigation committee (“SLC”) of the Board of Directors was created to investigate the claims in the derivative actions. In September 2005, the SLC completed its investigation of the claims made by the derivative plaintiffs in Rosenthal and Harris and rendered its decision that continuation of the derivative proceeding is not in our best interests. Accordingly, we filed a Motion to Dismiss each derivative complaint. On August 21, 2006, the federal court entered an Order dismissing the Rosenthal case, with prejudice. The ~~plaintiff filed a notice~~judgment of ~~appeal within the time permitted but later withdrew its notice of appeal with the court’s consent. Accordingly, the Rosenthal case has been resolved in our favor.~~dismissal is now final. On January 3, 2007, the state court orally granted our motion to dismiss the Harris case, ~~although the~~and entered a written order ~~has~~dismissing the Harris case on February 26, 2007. The plaintiff in Harris did not ~~yet been entered. This~~appeal the order of dismissal and the matter is ~~subject to appeal by the plaintiff.~~now final.

On September 12, 2006, we announced the approval of another stock repurchase plan by our Board of Directors. The ~~new~~ stock repurchase plan authorizes us to repurchase up to $300.0 million of our common stock in the open market or in privately negotiated transactions based on market conditions. ~~We did not~~

~~repurchase any stock during the three months ended December 31, 2006. The cumulative amount of stock repurchases authorized by our Board of Directors since April 2004 is $1,546.8 million.~~


	Three Months Ended December 31,	Six Months Ended December 31,		Three Months Ended March 31,		Nine Months Ended March 31,
	2005	2006	2005	2006		2007		2006
Number of shares	8,378,643	13,462,430	16,455,774		898,500		13,462,430		17,354,274

Average price per share	$23.25	$24.06	$24.24	$	25.73	$	24.06	$	24.32

As of ~~January 31,~~April 30, 2007, we had repurchased $1,246.8 million of our common stock since April 2004 and we had remaining authorization to repurchase $300.0 million of our common stock.

In January 2007, 53.6 million treasury shares were cancelled and were restored to the status of authorized but unissued shares. ~~Our outstanding common stock was not impacted by this action and there were 117,422,745 shares outstanding at January 31, 2007.~~

As of ~~December~~March 31, ~~2006,~~2007, total costs incurred to date related to our restructuring activities include $22.3 million in personnel-related costs and ~~$70.4~~$71.2 million of contract termination and other associated costs.

A summary of the liabilities, which are included in accrued taxes and expenses on the consolidated balance sheets, for restructuring charges for the ~~six~~nine months ended ~~December~~March 31, ~~2006,~~2007, is as follows (in thousands):


	Personnel- Related Costs			Contract Termination Costs			Other Associated Costs			Total			Personnel- Related Costs			Contract Termination Costs			Other Associated Costs			Total
Balance at June 30, 2006	$	1,066		$	11,673		$	2,577		$	15,316		$	1,066		$	11,673		$	2,577		$	15,316
Cash settlements		(730	)		(2,100	)					(2,830	)		(944	)		(3,237	)					(4,181	)
Non-cash settlements					(78	)		(708	)		(786	)					(94	)		(708	)		(802	)
Adjustments					282			104			386						1,027			116			1,143

Balance at December 31, 2006	$	336		$	9,777		$	1,973		$	12,086
Balance at March 31, 2007													$	122		$	9,369		$	1,985		$	11,476

As a result of the favorable resolution of prior contingent liabilities, we recorded a net reduction to the tax contingency balance of $21.0 million for the three months ended March 31, 2007.

A reconciliation of weighted average shares used to compute basic and diluted earnings per share is as follows (dollars in thousands, except per share data):


	Three Months Ended December 31,				Six Months Ended December 31,				Three Months Ended March 31,				Nine Months Ended March 31,
	2006		2005		2006		2005		2007		2006		2007		2006
Net income	$	95,426	$	86,574	$	169,662	$	140,607	$	103,732	$	86,732	$	273,394	$	227,339
Interest expense related to convertible senior notes, net of related tax effects		721		720		1,442		1,436		915		718		2,352		2,155

Adjusted net income	$	96,147	$	87,294	$	171,104	$	142,043	$	104,647	$	87,450	$	275,746	$	229,494

Weighted average shares outstanding		115,834,752		133,701,322		120,518,553		138,218,408

Weighted average shares
Basic										117,540,639		129,629,967		119,539,921		135,397,387
Incremental shares resulting from assumed conversions:
Stock-based compensation		2,825,351		3,130,631		2,927,875		3,231,175		2,133,123		3,494,321		2,662,957		3,318,890
Warrants		788,248		788,325		784,193		803,327		787,090		1,124,903		785,159		910,519
Convertible senior notes		10,705,205		10,705,205		10,705,205		10,705,205		10,705,205		10,705,205		10,705,205		10,705,205

		14,318,804		14,624,161		14,417,273		14,739,707		13,625,418		15,324,429		14,153,321		14,934,614

Weighted average shares and assumed incremental shares		130,153,556		148,325,483		134,935,826		152,958,115
Diluted										131,166,057		144,954,396		133,693,242		150,332,001

Earnings per share:
Basic	$	0.82	$	0.65	$	1.41	$	1.02	$	0.88	$	0.67	$	2.29	$	1.68

Diluted	$	0.74	$	0.59	$	1.27	$	0.93	$	0.80	$	0.60	$	2.06	$	1.53

Basic earnings per share have been computed by dividing net income by basic weighted average ~~shares outstanding.~~shares.

Diluted earnings per share have been computed by dividing net income, adjusted for interest expense (net of related tax effects) related to our convertible senior notes issued in November 2003, by the diluted weighted average ~~shares and assumed incremental~~ shares. The treasury stock method was used to compute the assumed incremental shares related to our outstanding stock-based compensation and warrants and will be used to compute the shares related to our convertible senior notes issued in September 2006 upon our stock price increasing above the relevant initial conversion price. The average common stock market prices for the periods were used to determine the number of incremental shares. Options to purchase approximately 0.7 million ~~and 0.8 million~~ shares of common stock at ~~December~~March 31, ~~2006~~2007 and ~~2005, respectively,~~2006, were not included in the computation of diluted earnings per share because the option exercise price was greater than the average market price of the common shares. Warrants to purchase approximately 30.0 million shares ~~and 11.2 million shares~~ of common stock ~~at December~~for the three and nine months ended March 31, ~~2006~~2007, and ~~2005,~~10.8 million shares and 11.1 million shares for the three and nine months ended March 31, 2006, respectively, were not included in the computation of diluted earnings per share because the exercise price was greater than the average market price of the common shares.

The if-converted method was used to calculate the impact of our convertible senior notes issued in November 2003 on assumed incremental shares.

Cash payments for interest costs and income taxes consist of the following (in thousands):

On January 1, 2007, we completed our acquisition of Long Beach Acceptance Corp. (“LBAC”). LBAC was the auto finance subsidiary of ACC Capital Holdings. The total consideration paid to ACC Capital Holdings in the all-cash transaction was $282.5 million.

LBAC operates from offices in Paramus, New Jersey and Orange, California and serves auto dealers in 34 states offering auto finance products primarily to consumers with near prime credit scores. As of December 31, 2006, LBAC had approximately $1.8 billion in managed auto receivables.

The ~~payment~~payments of principal and interest on our convertible senior notes are guaranteed by certain of our subsidiaries (the “Subsidiary Guarantors”). The separate financial statements of the Subsidiary Guarantors are not included herein because the Subsidiary Guarantors are our wholly-owned consolidated subsidiaries and are jointly, severally and unconditionally liable for the obligations represented by the convertible senior notes. We believe that the consolidating financial information for AmeriCredit Corp., the combined Subsidiary Guarantors and the combined Non-Guarantor Subsidiaries provide information that is more meaningful in understanding the financial position of the Subsidiary Guarantors than separate financial statements of the Subsidiary Guarantors.

The consolidating financial statements present consolidating financial data for (i) AmeriCredit Corp. (on a parent only basis), (ii) the combined Subsidiary Guarantors, (iii) the combined Non-Guarantor Subsidiaries, (iv) an elimination column for adjustments to arrive at the information for the parent company and our subsidiaries on a consolidated basis and (v) the parent company and our subsidiaries on a consolidated basis.

Investments in subsidiaries are accounted for by the parent company using the equity method for purposes of this presentation. Results of operations of subsidiaries are therefore reflected in the parent company’s investment accounts and earnings. The principal elimination entries set forth below eliminate investments in subsidiaries and intercompany balances and transactions.


															AmeriCredit Corp.			Guarantors			Non- Guarantors		Eliminations			Consolidated
	AmeriCredit Corp.			Guarantors			Non- Guarantors		Eliminations			Consolidated			AmeriCredit Corp.						Non- Guarantors		Eliminations			Consolidated
ASSETS																		Guarantors

Cash and cash equivalents				$	887,671		$	9,715				$	897,386					$	601,311		$	14,084				$	615,395
Finance receivables, net					169,647			11,687,738					11,857,385						301,283			14,066,164					14,367,447
Restricted cash - securitization notes payable								865,591					865,591									1,144,173					1,144,173
Restricted cash - credit facilities								149,173					149,173									194,693					194,693
Credit enhancement assets								6,061					6,061									5,977					5,977
Property and equipment, net	$	6,360			48,436								54,796		$	6,277			52,764			4,352					63,393
Deferred income taxes		59,040			(20,885	)		61,502					99,657			116,981			(75,301	)		111,841					153,521
Goodwill																			200,497								200,497
Other assets		19,539			95,171			68,501					183,211			13,716			58,076			68,023					139,815
Due from affiliates		675,796						1,754,546	$	(2,430,342	)					659,198						2,159,148	$	(2,818,346	)
Investment in affiliates		1,877,419			3,351,554			537,440		(5,766,413	)					1,976,242			3,927,126			542,972		(6,446,340	)

Total assets	$	2,638,154		$	4,531,594		$	15,140,267	$	(8,196,755	)	$	14,113,260		$	2,772,414		$	5,065,756		$	18,311,427	$	(9,264,686	)	$	16,884,911

LIABILITIES AND SHAREHOLDERS’ EQUITY

Liabilities:
Credit facilities							$	2,400,881				$	2,400,881								$	3,004,774				$	3,004,774
Securitization notes payable								8,907,498					8,907,498									10,883,909					10,883,909
Convertible senior notes	$	750,000											750,000		$	750,000											750,000
Funding payable				$	56,016			468					56,484					$	92,555			615					93,170
Accrued taxes and expenses		43,935			37,753			59,860					141,548			71,687			47,065			70,232					188,984
Other liabilities		1,582			12,630								14,212			1,057			13,347								14,404
Due to affiliates					2,430,342				$	(2,430,342	)								2,818,364				$	(2,818,364	)

Total liabilities		795,517			2,536,741			11,368,707		(2,430,342	)		12,270,623			822,744			2,971,331			13,959,530		(2,818,364	)		14,935,241

Shareholders’ equity:
Common stock		1,729			75,355			30,627		(105,982	)		1,729			1,198			75,355			30,627		(105,982	)		1,198
Additional paid-in capital		1,236,709			75,791			1,475,105		(1,550,896	)		1,236,709			47,728			75,791			2,026,504		(2,102,295	)		47,728
Accumulated other comprehensive income		43,380			27,344			30,274		(57,618	)		43,380			29,497			13,408			30,858		(44,266	)		29,497
Retained earnings		1,809,479			1,816,363			2,235,554		(4,051,917	)		1,809,479			1,913,211			1,929,871			2,263,908		(4,193,779	)		1,913,211

		3,091,297			1,994,853			3,771,560		(5,766,413	)		3,091,297			1,991,634			2,094,425			4,351,897		(6,446,322	)		1,991,634
Treasury stock		(1,248,660	)										(1,248,660	)		(41,964	)										(41,964	)

Total shareholders’ equity		1,842,637			1,994,853			3,771,560		(5,766,413	)		1,842,637			1,949,670			2,094,425			4,351,897		(6,446,322	)		1,949,670

Total liabilities and shareholders’ equity	$	2,638,154		$	4,531,594		$	15,140,267	$	(8,196,755	)	$	14,113,260		$	2,772,414		$	5,065,756		$	18,311,427	$	(9,264,686	)	$	16,884,911


	AmeriCredit Corp.			Guarantors		Non- Guarantors		Eliminations			Consolidated			AmeriCredit Corp.			Guarantors		Non- Guarantors		Eliminations			Consolidated
ASSETS

Cash and cash equivalents				$	513,240						$	513,240					$	513,240						$	513,240
Finance receivables, net					107,370	$	10,989,638					11,097,008						107,370	$	10,989,638					11,097,008
Restricted cash - securitization notes payable							860,935					860,935								860,935					860,935
Restricted cash - credit facilities							140,042					140,042								140,042					140,042
Credit enhancement assets							104,624					104,624								104,624					104,624
Property and equipment, net	$	6,527			50,698							57,225		$	6,527			50,698							57,225
Deferred income taxes		(45,684	)		80,940		43,533					78,789			(45,684	)		80,940		43,533					78,789
Goodwill																		14,435							14,435
Other assets		2,521			160,037		53,812	$	(368	)		216,002			2,521			145,602		53,812	$	(368	)		201,567
Due from affiliates		582,204					1,698,481		(2,280,685	)					582,204					1,698,481		(2,280,685	)
Investment in affiliates		1,726,327			3,308,956		458,820		(5,494,103	)					1,726,327			3,308,956		458,820		(5,494,103	)

Total assets	$	2,271,895		$	4,221,241	$	14,349,885	$	(7,775,156	)	$	13,067,865		$	2,271,895		$	4,221,241	$	14,349,885	$	(7,775,156	)	$	13,067,865


LIABILITIES AND SHAREHOLDERS’ EQUITY

Liabilities:
Credit facilities						$	2,106,282				$	2,106,282							$	2,106,282				$	2,106,282
Securitization notes payable							8,566,741	$	(47,892	)		8,518,849								8,566,741	$	(47,892	)		8,518,849
Convertible senior notes	$	200,000										200,000		$	200,000										200,000
Funding payable				$	54,002		621					54,623					$	54,002		621					54,623
Accrued taxes and expenses		59,360			43,637		53,170		(368	)		155,799			59,360			43,637		53,170		(368	)		155,799
Other liabilities		3,649			19,777							23,426			3,649			19,777							23,426
Due to affiliates					2,259,569				(2,259,569	)								2,259,569				(2,259,569	)

Total liabilities		263,009			2,376,985		10,726,814		(2,307,829	)		11,058,979			263,009			2,376,985		10,726,814		(2,307,829	)		11,058,979


Shareholders’ equity:
Common stock		1,695			75,355		30,627		(105,982	)		1,695			1,695			75,355		30,627		(105,982	)		1,695
Additional paid-in capital		1,217,445			75,791		1,460,252		(1,536,043	)		1,217,445			1,217,445			75,791		1,460,252		(1,536,043	)		1,217,445
Accumulated other comprehensive income		74,282			55,428		35,425		(90,853	)		74,282			74,282			55,428		35,425		(90,853	)		74,282
Retained earnings		1,639,817			1,637,682		2,096,767		(3,734,449	)		1,639,817			1,639,817			1,637,682		2,096,767		(3,734,449	)		1,639,817

		2,933,239			1,844,256		3,623,071		(5,467,327	)		2,933,239			2,933,239			1,844,256		3,623,071		(5,467,327	)		2,933,239
Treasury stock		(924,353	)									(924,353	)		(924,353	)									(924,353	)

Total shareholders’ equity		2,008,886			1,844,256		3,623,071		(5,467,327	)		2,008,886			2,008,886			1,844,256		3,623,071		(5,467,327	)		2,008,886

Total liabilities and shareholders’ equity	$	2,271,895		$	4,221,241	$	14,349,885	$	(7,775,156	)	$	13,067,865		$	2,271,895		$	4,221,241	$	14,349,885	$	(7,775,156	)	$	13,067,865


	AmeriCredit Corp.			Guarantors		Non- Guarantors			Eliminations			Consolidated		AmeriCredit Corp.			Guarantors			Non- Guarantors			Eliminations			Consolidated
Revenue
Finance charge income				$	31,742	$	470,475					$	502,217				$	30,203		$	533,901					$	564,104
Servicing income (loss)					1,472		(493	)					979					9,273			(8,702	)					571
Other income	$	13,989			587,259		1,208,355		$	(1,737,163	)		72,440	$	13,400			560,861			1,134,133		$	(1,673,597	)		34,797
Gain on sale of equity investment																		15,801									15,801
Equity in income of affiliates		103,314			78,063					(181,377	)				113,508			28,354						(141,862	)

		117,303			698,536		1,678,337			(1,918,540	)		575,636		126,908			644,492			1,659,332			(1,815,459	)		615,273

Costs and expenses
Operating expenses		22,851			2,163		69,081						94,095		22,804			15,168			71,474						109,446
Provision for loan losses					3,028		171,772						174,800					(86,000	)		275,028						189,028
Interest expense		3,618			575,657		1,313,748			(1,737,163	)		155,860		3,678			586,124			1,270,405			(1,673,597	)		186,610
Restructuring charges, net					77								77					757									757

		26,469			580,925		1,554,601			(1,737,163	)		424,832		26,482			516,049			1,616,907			(1,673,597	)		485,841

Income before income taxes		90,834			117,611		123,736			(181,377	)		150,804		100,426			128,443			42,425			(141,862	)		129,432

Income tax (benefit) provision		(4,592	)		14,297		45,673						55,378		(3,306	)		14,935			14,071						25,700

Net income	$	95,426		$	103,314	$	78,063		$	(181,377	)	$	95,426	$	103,732		$	113,508		$	28,354		$	(141,862	)	$	103,732


	AmeriCredit Corp.		Guarantors			Non- Guarantors		Eliminations			Consolidated		AmeriCredit Corp.			Guarantors			Non- Guarantors		Eliminations			Consolidated
Revenue
Finance charge income			$	21,739		$	372,336				$	394,075				$	26,867		$	387,573				$	414,440
Servicing income				9,928			11,517					21,445					701			14,305					15,006
Other income	$	16,891		431,581			930,852	$	(1,346,716	)		32,608	$	13,771			438,370			998,790	$	(1,425,273	)		25,658
Equity in income of affiliates		83,012		94,065					(177,077	)				92,043			107,339					(199,382	)

		99,903		557,313			1,314,705		(1,523,793	)		448,128		105,814			573,277			1,400,668		(1,624,655	)		455,104

Costs and expenses
Operating expenses		6,032		22,565			55,322					83,919		17,157			12,924			59,605					89,686
Provision for loan losses				17,760			108,105					125,865					26,827			91,942					118,769
Interest expense		5,219		440,329			1,002,347		(1,346,716	)		101,179		5,045			448,593			1,078,741		(1,425,273	)		107,106
Restructuring charges				93								93
Restructuring charges, net																	1,874								1,874

		11,251		480,747			1,165,774		(1,346,716	)		311,056		22,202			490,218			1,230,288		(1,425,273	)		317,435

Income before income taxes		88,652		76,566			148,931		(177,077	)		137,072		83,612			83,059			170,380		(199,382	)		137,669

Income tax provision (benefit)		2,078		(6,446	)		54,866					50,498
Income tax (benefit) provision														(3,120	)		(8,984	)		63,041					50,937

Net income	$	86,574	$	83,012		$	94,065	$	(177,077	)	$	86,574	$	86,732		$	92,043		$	107,339	$	(199,382	)	$	86,732


	AmeriCredit Corp.			Guarantors			Non- Guarantors			Eliminations			Consolidated		AmeriCredit Corp.			Guarantors			Non- Guarantors			Eliminations			Consolidated
Revenue
Finance charge income				$	54,691		$	931,883					$	986,574				$	84,894		$	1,465,784					$	1,550,678
Servicing income (loss)					11,016			(2,578	)					8,438					20,289			(11,280	)					9,009
Other income	$	22,855			948,169			2,025,329		$	(2,892,108	)		104,245	$	36,255			1,472,834			3,159,462		$	(4,565,705	)		102,846
Gain on sale of equity investment																			51,997									51,997
Equity in income of affiliates		178,681			138,787						(317,468	)				292,189			167,141						(459,330	)

		201,536			1,152,663			2,954,634			(3,209,576	)		1,099,257		328,444			1,797,155			4,613,966			(5,025,035	)		1,714,530

Costs and expenses
Operating expenses		31,861			13,058			137,464						182,383		54,665			28,226			208,938						291,829
Provision for loan losses					(6,194	)		354,899						348,705					(92,194	)		629,927						537,733
Interest expense		5,266			943,873			2,242,300			(2,892,108	)		299,331		8,944			1,529,997			3,512,705			(4,565,705	)		485,941
Restructuring charges, net					386									386					1,143									1,143

		37,127			951,123			2,734,663			(2,892,108	)		830,805		63,609			1,467,172			4,351,570			(4,565,705	)		1,316,646

Income before income taxes		164,409			201,540			219,971			(317,468	)		268,452		264,835			329,983			262,396			(459,330	)		397,884

Income tax provision		(5,253	)		22,859			81,184						98,790
Income tax (benefit) provision																(8,559	)		37,794			95,255						124,490

Net income	$	169,662		$	178,681		$	138,787		$	(317,468	)	$	169,662	$	273,394		$	292,189		$	167,141		$	(459,330	)	$	273,394


	AmeriCredit Corp.		Guarantors			Non- Guarantors		Eliminations			Consolidated		AmeriCredit Corp.		Guarantors			Non- Guarantors		Eliminations			Consolidated
Revenue
Finance charge income			$	46,633		$	721,178				$	767,811			$	73,500		$	1,108,751				$	1,182,251
Servicing income				25,078			21,708					46,786				25,779			36,013					61,792
Other income	$	32,618		709,812			1,517,046	$	(2,205,682	)		53,794	$	46,389		1,139,335			2,515,836	$	(3,630,955	)		70,605
Gain on sale of equity investment																8,847								8,847
Equity in income of affiliates		133,153		154,125					(287,278	)				225,196		261,464					(486,660	)

		165,771		935,648			2,259,932		(2,492,960	)		868,391		271,585		1,508,925			3,660,600		(4,117,615	)		1,323,495

Costs and expenses
Operating expenses		10,158		44,387			107,239					161,784		27,315		57,311			166,844					251,470
Provision for loan losses				38,737			252,988					291,725				65,564			344,930					410,494
Interest expense		10,618		731,453			1,655,061		(2,205,682	)		191,450		15,663		1,180,046			2,733,802		(3,630,955	)		298,556
Restructuring charges				252								252
Restructuring charges, net																2,126								2,126

		20,776		814,829			2,015,288		(2,205,682	)		645,211		42,978		1,305,047			3,245,576		(3,630,955	)		962,646

Income before income taxes		144,995		120,819			244,644		(287,278	)		223,180		228,607		203,878			415,024		(486,660	)		360,849

Income tax provision (benefit)		4,388		(12,334	)		90,519					82,573		1,268		(21,318	)		153,560					133,510

Net income	$	140,607	$	133,153		$	154,125	$	(287,278	)	$	140,607	$	227,339	$	225,196		$	261,464	$	(486,660	)	$	227,339


	AmeriCredit Corp.			Guarantors			Non- Guarantors			Eliminations			Consolidated			AmeriCredit Corp.			Guarantors			Non- Guarantors			Eliminations			Consolidated
Cash flows from operating activities:
Net income	$	169,662		$	178,681		$	138,787		$	(317,468	)	$	169,662		$	273,394		$	292,189		$	167,141		$	(459,330	)	$	273,394
Adjustments to reconcile net income to net cash (used) provided by operating activities:
Depreciation and amortization		1,351			5,315			12,831						19,497			2,266			8,431			13,328						24,025
Accretion and amortization of loan fees					(1,186	)		(12,773	)					(13,959	)					293			(17,559	)					(17,266	)
Provision for loan losses					(6,194	)		354,899						348,705						(92,194	)		629,927						537,733
Deferred income taxes		(100,694	)		121,099			(16,837	)					3,568			(155,598	)		200,570			(67,158	)					(22,186	)
Accretion of present value discount					9,396			(15,351	)					(5,955	)								(6,394	)					(6,394	)
Stock-based compensation expense		9,321												9,321			14,375												14,375
Gain on sale of available for sale securities					(36,196	)								(36,196	)					(51,997	)								(51,997	)
Other					2,683			(237	)					2,446						3,980			(261	)					3,719
Equity in income of affiliates		(178,681	)		(138,787	)					317,468						(292,189	)		(167,141	)					459,330
Changes in assets and liabilities:
Other assets		(5,059	)		924			7,440						3,305			(4	)		15,885			11,293						27,174
Accrued taxes and expenses		(15,433	)		(5,732	)		7,810						(13,355	)		15,359			(24,912	)		14,038						4,485

Net cash (used) provided by operating activities		(119,533	)		130,003			476,569						487,039			(142,397	)		185,104			744,355						787,062


Cash flows from investing activities:
Purchases of receivables					(3,740,828	)		(3,605,060	)		3,605,060			(3,740,828	)					(6,283,184	)		(5,780,275	)		5,780,275			(6,283,184	)
Principal collections and recoveries on receivables					71,391			2,559,890						2,631,281						320,024			3,932,476						4,252,500
Net proceeds from sale of receivables					3,605,060						(3,605,060	)								5,780,275						(5,780,275	)
Distributions from gain on sale Trusts								92,709						92,709									92,957						92,957
Purchases of property and equipment					(3,001	)								(3,001	)					(9,271	)		(3,466	)					(12,737	)
Proceeds from sale of equity investment					44,300									44,300						62,961									62,961
Change in restricted cash - securitization notes payable								(4,629	)					(4,629	)
Change in restricted cash - credit facilities								(9,131	)					(9,131	)
Acquisition of Long Beach, net of cash acquired																				(257,813	)								(257,813	)
Change in restricted cash— securitization notes payable																							(162,773	)					(162,773	)
Change in restricted cash— credit facilities																							(51,387	)					(51,387	)
Change in other assets					1,943			5						1,948						4,871			5						4,876
Net change in investment in affiliates		953			90,549			(83,946	)		(7,556	)					799			(455,336	)		(89,461	)		543,998

Net cash provided (used) by investing activities		953			69,414			(1,050,162	)		(7,556	)		(987,351	)		799			(837,473	)		(2,061,924	)		543,998			(2,354,600	)


Cash flows from financing activities:
Net change in credit facilities								294,599						294,599						(202,522	)		898,492						695,970
Issuance of securitization notes payable								2,550,000						2,550,000									4,248,304						4,248,304
Payments on securitization notes payable								(2,163,227	)					(2,163,227	)					(2,074	)		(3,474,599	)					(3,476,673	)
Issuance of convertible senior notes		550,000												550,000			550,000												550,000
Debt issuance costs		(13,143	)					(10,771	)					(23,914	)		(13,207	)					(15,262	)					(28,469	)
Proceeds from sale of warrants		93,086												93,086			93,086												93,086
Purchase of call option on common stock		(145,710	)											(145,710	)		(145,710	)											(145,710	)
Repurchase of common stock		(323,964	)											(323,964	)		(323,964	)											(323,964	)
Net proceeds from issuance of common stock		43,226						14,853			(14,853	)		43,226			47,864						566,252			(566,252	)		47,864
Other net changes		12,943			(422	)								12,521			13,833			(635	)								13,198
Net change in due (to) from affiliates		(93,592	)		177,175			(102,147	)		18,564						(76,994	)		947,375			(891,534	)		21,153

Net cash provided (used) by financing activities		122,846			176,753			583,307			3,711			886,617
Net cash provided by financing activities																	144,908			742,144			1,331,653			(545,099	)		1,673,606

Net increase (decrease) in cash and cash equivalents		4,266			376,170			9,714			(3,845	)		386,305

Net increase in cash and cash equivalents																	3,310			89,775			14,084			(1,101	)		106,068
Effect of Canadian exchange rate changes on cash and cash equivalents		(4,266	)		(1,739	)		1			3,845			(2,159	)		(3,310	)		(1,704	)					1,101			(3,913	)

Cash and cash equivalents at beginning of period					513,240									513,240						513,240									513,240

Cash and cash equivalents at end of period	$			$	887,671		$	9,715		$			$	897,386		$			$	601,311		$	14,084		$			$	615,395


	AmeriCredit Corp.			Guarantors			Non- Guarantors			Eliminations			Consolidated			AmeriCredit Corp.			Guarantors			Non- Guarantors			Eliminations			Consolidated
Cash flows from operating activities:
Net income	$	140,607		$	133,153		$	154,125		$	(287,278	)	$	140,607		$	227,339		$	225,196		$	261,464		$	(486,660	)	$	227,339
Adjustments to reconcile net income to net cash (used) provided by operating activities:
Depreciation and amortization		1,075			6,382			10,672						18,129			1,670			9,198			16,767						27,635
Accretion and amortization of loan fees					(1,457	)		(5,291	)					(6,748	)					(1,979	)		(10,556	)					(12,535	)
Provision for loan losses					38,737			252,988						291,725						65,564			344,930						410,494
Deferred income taxes		(80,463	)		(12,167	)		90,546						(2,084	)		(154,380	)		(21,318	)		153,586						(22,112	)
Accretion of present value discount					(385	)		(22,273	)					(22,658	)					(394	)		(30,293	)					(30,687	)
Stock-based compensation expense		9,298												9,298			12,690												12,690
Gain on sale of available for sale securities					(8,847	)								(8,847	)					(8,847	)								(8,847	)
Other		216			(778	)		(127	)					(689	)		216			280			(182	)					314
Equity in income of affiliates		(133,153	)		(154,125	)					287,278						(225,196	)		(261,464	)					486,660
Changes in assets and liabilities:
Other assets		13,460			(13,999	)		10,449						9,910			352			60,247			22,696						83,295
Accrued taxes and expenses		(47,059	)		30,648			(2,636	)					(19,047	)		19,934			5,859			2,669						28,462

Net cash (used) provided by operating activities		(96,019	)		17,162			488,453						409,596			(117,375	)		72,342			761,081						716,048


Cash flows from investing activities:
Purchases of receivables					(3,146,643	)		(3,094,354	)		3,094,354			(3,146,643	)					(5,093,811	)		(4,964,349	)		4,964,349			(5,093,811	)
Principal collections and recoveries on receivables					26,906			1,925,873						1,952,779						59,891			3,049,225						3,109,116
Net proceeds from sale of receivables					3,094,354						(3,094,354	)								4,964,349						(4,964,349	)
Distributions from gain on sale Trusts					6,923			246,750						253,673						6,923			339,213						346,136
Purchases of property and equipment		1,689			(3,939	)		1						(2,249	)		1,690			(5,944	)		1						(4,253	)
Sale of property					34,807									34,807						34,807									34,807
Proceeds from sale of equity investment					11,992									11,992						11,992									11,992
Change in restricted cash - securitization notes payable								(63,967	)					(63,967	)
Change in restricted cash - credit facilities								(70,874	)					(70,874	)
Change in restricted cash— securitization notes payable																							(168,884	)					(168,884	)
Change in restricted cash— warehouse credit facilities																							353,445						353,445
Change in other assets					2,583									2,583						3,273									3,273
Net change in investment in affiliates		(889	)		885,028			(118,916	)		(765,223	)					(820	)		266,956			(125,158	)		(140,978	)

Net cash provided (used) by investing activities		800			912,011			(1,175,487	)		(765,223	)		(1,027,899	)		870			248,436			(1,516,507	)		(140,978	)		(1,408,179	)


Cash flows from financing activities:
Net change in credit facilities								241,933						241,933
Net change in warehouse credit facilities																							444,160						444,160
Issuance of securitization notes payable								2,500,000						2,500,000									3,445,000						3,445,000
Payments on securitization notes payable								(1,791,525	)					(1,791,525	)								(2,745,016	)					(2,745,016	)
Retirement of senior notes		(13,200	)											(13,200	)		(13,200	)											(13,200	)
Debt issuance costs		131						(8,264	)					(8,133	)		130						(12,019	)					(11,889	)
Repurchase of common stock		(398,929	)											(398,929	)		(422,046	)											(422,046	)
Net proceeds from issuance of common stock		9,181			71			(766,183	)		766,112			9,181			24,148			121			(141,920	)		141,799			24,148
Other net changes		(109	)		(375	)								(484	)		6,937			(572	)								6,365
Net change in due (to) from affiliates		493,169			(1,053,050	)		556,093			3,788						516,109			(397,156	)		(122,292	)		3,339

Net cash provided (used) by financing activities		90,243			(1,053,354	)		732,054			769,900			538,843			112,078			(397,607	)		867,913			145,138			727,522

Net (decrease) increase in cash and cash equivalents		(4,976	)		(124,181	)		45,020			4,677			(79,460	)		(4,427	)		(76,829	)		112,487			4,160			35,391

Effect of Canadian exchange rate changes on cash and cash equivalents		4,976			1,797			8			(4,677	)		2,104			4,427			1,635			6			(4,160	)		1,908

Cash and cash equivalents at beginning of period					663,501									663,501						663,501									663,501

Cash and cash equivalents at end of period	$			$	541,117		$	45,028		$			$	586,145		$			$	588,307		$	112,493		$			$	700,800

~~Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS~~

We are a leading independent auto finance company specializing in purchasing retail automobile installment sales contracts originated by franchised and select independent dealers in connection with the sale of used and new automobiles and, to a lesser extent, making loans directly to consumers buying new and used vehicles. We generate revenue and cash flows primarily through the purchase, retention, subsequent securitization and servicing of finance receivables. As used herein, “loans” include auto finance receivables originated by dealers and purchased by us as well as direct extensions of credit made by us to consumer borrowers. To fund the acquisition of receivables prior to securitization and to fund the repurchase of receivables pursuant to ~~cleanup~~clean-up call options, we use available cash and borrowings under our credit facilities. We earn finance charge income on the finance receivables and pay interest expense on borrowings under our credit facilities.

We, through wholly-owned subsidiaries, periodically transfer receivables to securitization trusts (“Trusts”) that issue one or more series of asset-backed securities. The asset-backed securities are, in turn, sold to investors. We retain an interest in these securitization transactions in the form of restricted cash accounts and overcollateralization whereby more receivables are transferred to the Trusts than the amount of asset-backed securities issued by the Trusts as well as the estimated future excess cash flows expected to be received by us over the life of the securitization. Excess cash flows result from the difference between the finance charges received from the obligors on the receivables and the interest paid to investors in the asset-backed securities, net of credit losses and expenses.

Excess cash flows from the Trusts are initially utilized to reach credit enhancement requirements required for specific credit ratings for the asset-backed securities issued by the Trusts. Once predetermined credit enhancement requirements are reached and maintained, excess cash flows are distributed to us. Certain credit enhancement requirements will increase if targeted portfolio performance ratios are exceeded. In addition to excess cash flows, we receive monthly base servicing fees and we collect other fees, such as late charges, as servicer for securitization Trusts.

We structure our securitization transactions as secured financings. Accordingly, following a securitization, the finance receivables and the related securitization notes payable remain on the consolidated balance sheets. We recognize finance charge and fee income on the receivables and interest expense on the securities issued in the securitization transaction and record a provision for loan losses to cover probable loan losses on the receivables.

Prior to October 1, 2002, securitization transactions were structured as sales of finance receivables. We also acquired two securitization Trusts which were accounted for as sales of finance receivables. Receivables sold under this structure are referred to herein as “gain on sale receivables.” At ~~December~~March 31, ~~2006,~~2007, we had one outstanding gain on sale securitization that represents less than one percent of our managed ~~receivables were gain on sale~~ receivables.

On May 1, 2006, we acquired the stock of Bay View Acceptance Corp. (“BVAC”), the auto finance subsidiary of Bay View Capital Corporation. BVAC operates from offices in Covina, California, and serves auto dealers in 32 states offering specialized auto finance products, including extended term financing and higher loan-to-value advances to consumers with prime credit scores.

On January 1, 2007, we ~~completed our acquisition~~acquired the stock of Long Beach Acceptance Corp. (“LBAC”)~~. LBAC was~~, the auto finance subsidiary of ACC Capital Holdings. ~~The total consideration paid to ACC Capital Holdings in the all-cash transaction was $282.5 million.~~

LBAC operates from regional offices in Paramus, New Jersey and Orange, California and serves auto dealers in 34 states offering auto finance products primarily to consumers with near prime credit scores. ~~As of December 31, 2006, LBAC had approximately $1.8 billion in managed auto receivables.~~

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions which affect the reported amounts of assets and liabilities and the disclosures of contingent assets and liabilities as of the date of the financial statements and the amount of revenue and costs and expenses during the reporting periods. Actual results could differ from those estimates and those differences may be material. The accounting estimates that we believe are the most critical to understanding and evaluating our reported financial results include the following:

The allowance for loan losses is established systematically based on the determination of the amount of probable credit losses inherent in the finance receivables as of the reporting date. We review charge-off experience factors, delinquency reports, historical collection rates, estimates of the value of the underlying collateral, economic trends, such as unemployment rates, and other information in order to make the necessary judgments as to the probable credit losses. We also use historical charge-off experience to determine a loss confirmation period, which is defined as the time between when an event, such as delinquency status, giving rise to a probable credit loss occurs with respect to a specific account and when such account is charged off. This loss confirmation period is applied to the forecasted probable credit losses to

determine the amount of losses inherent in finance receivables at the reporting date. Assumptions regarding credit losses and loss confirmation periods are reviewed periodically and may be impacted by actual performance of finance receivables and changes in any of the factors discussed above. Should the credit loss assumption or loss confirmation period increase, there would be an increase in the amount of allowance for loan losses required, which would

decrease the net carrying value of finance receivables and increase the amount of provision for loan losses recorded on the consolidated statements of income and comprehensive income. A 10% and 20% increase in cumulative net credit losses over the loss confirmation period would increase the allowance for loan losses as of ~~December~~March 31, ~~2006,~~2007, as follows (in thousands):

We believe that the allowance for loan losses is adequate to cover probable losses inherent in our receivables; however, because the allowance for loan losses is based on estimates, there can be no assurance that the ultimate charge-off amount will not exceed such estimates or that our credit loss assumptions will not increase.

The fair value of each option granted or modified during the ~~three and six~~nine months ended ~~December~~March 31, ~~2006~~2007 and ~~2005,~~2006, was estimated using the Black-Scholes option-pricing model with the following weighted average assumptions:


	Three Months Ended December 31,				Six Months Ended December 31,				Nine Months Ended March 31,
	2006		2005		2006		2005		2007		2006
Expected dividends	0		0		0		0		0		0
Expected volatility	32.6	%	38.4	%	32.6	%	38.4	%	32.6	%	38.4	%
Risk-free interest rate	4.9	%	4.3	%	4.9	%	4.3	%	4.9	%	4.3	%
Expected life	1.2 years		3.1 years		1.2 years		3.1 years		1.2 years		3.1 years

We have not paid out dividends historically, thus the dividend yields are estimated at zero percent.

Our assumption for determining expected volatility reflects an average of the implied and historical volatility rates. Management believes that a combination of market-based measures is currently the best available indicator of expected volatility.

The risk-free interest rate is the implied yield available for zero-coupon U.S. government issues with a remaining term equal to the expected life of the options.

The expected lives of options are determined based on our historical option exercise experience and the term of the option.

Assumptions are reviewed each time there is a new grant or modification of a previous grant and may be impacted by actual fluctuation in our stock price, movements in market interest rates and option terms. The use of different assumptions produces a different fair value for the options granted or

modified and impacts the amount of compensation expense recognized on the consolidated statements of income and comprehensive income. The impact of a 10% or 20% increase in our assumptions of volatility, risk-free interest rate and expected life on the amount of compensation expense recognized would not have been material for the three and ~~six~~nine months ended ~~December~~March 31, ~~2006~~2007 and ~~2005.~~2006.

We are subject to income tax in the United States and Canada. In the ordinary course of our business, there may be transactions, calculations, structures and filing positions where the ultimate tax outcome is uncertain. At any point in time, multiple tax years are subject to audit by various taxing jurisdictions and we record probable liabilities for anticipated tax issues based on an estimate of the ultimate resolution of whether, and the extent to which, additional taxes, penalties, and interest may be due. Management believes that the estimates are reasonable. However, due to expiring statutes of limitations, audits, settlements, changes in tax law or new authoritative rulings, no assurance can be given that the final outcome of these matters will be comparable to what was reflected in the historical income tax provisions and accruals. If actual results differ from estimated results or if we adjust these assumptions in the future, we may need to adjust our deferred tax assets or liabilities which could materially impact the effective tax rate, earnings, deferred tax balances and cash.

As a result of the favorable resolution of prior contingent liabilities, we recorded a net reduction to the tax contingency balance of $21.0 million for the three months ended March 31, 2007.

As a part of our financial reporting process, we must assess the likelihood that our deferred tax assets can be recovered. If recovery is not likely, the provision for taxes must be increased by recording a reserve in the form of a valuation allowance for the deferred tax assets that are estimated to be unrecoverable. In this process, certain criteria are evaluated including the existence of deferred tax liabilities that can be used to absorb deferred tax assets, taxable income in prior carryback years that can be used to absorb net operating losses, credit carrybacks, and estimated taxable income in future years. Based upon our earnings history and earnings projections, management believes it is more likely than not that the tax benefits of the asset will be fully realized. Accordingly, no valuation allowance has been provided on deferred taxes. Our judgment regarding future taxable income may change due to future market conditions, changes in U.S. or international tax laws and other factors. These changes, if any, may require adjustments to these deferred tax assets and an accompanying reduction or increase in net income in the period in which such determinations are made.

Three Months Ended ~~December~~March 31, ~~2006~~2007 as compared to Three Months Ended ~~December~~March 31, ~~2005~~2006


	Three Months Ended December 31,						Three Months Ended March 31,
	2006			2005			2007			2006
Balance at beginning of period	$	12,218,713		$	9,462,883		$	12,548,925		$	9,873,603
LBAC acquisition								1,784,263
Loans purchased		1,740,767			1,339,526			2,514,268			1,614,267
Loans repurchased from gain on sale Trusts		64,060			186,372						183,350
Liquidations and other		(1,474,615	)		(1,115,178	)		(1,723,549	)		(1,288,715	)

Balance at end of period	$	12,548,925		$	9,873,603		$	15,123,907		$	10,382,505

Average finance receivables	$	12,392,922		$	9,573,416		$	14,669,061		$	10,115,082

The increase in loans purchased during the three months ended ~~December~~March 31, ~~2006,~~2007, as compared to the three months ended ~~December~~March 31, ~~2005,~~2006, was due to the addition of dealer relationship managers and branch office staff resulting in relationships with more auto dealers, increased penetration in existing dealer relationships and originations of ~~$129.5~~$175.2 million and $322.9 million through the BVAC ~~platform.~~and LBAC platforms, respectively. The increase in liquidations and other resulted primarily from increased collections and charge-offs on finance receivables due to the increase in ~~average~~ finance receivables and average age, or seasoning, of the portfolio.

The average new loan size ~~was $18,330~~increased to $18,629 for the three months ended ~~December~~March 31, ~~2006, compared to $17,328~~2007, from $17,030 for the three months ended ~~December~~March 31, ~~2005.~~2006, due to the addition of loans purchased through the BVAC and LBAC platforms which are generally higher in quality and larger in size. The average annual percentage rate for finance receivables purchased during the three months ended ~~December~~March 31, ~~2006,~~2007, decreased to ~~16.5%~~15.6% from ~~16.8%~~16.9% during the three months ended ~~December~~March 31, ~~2005,~~2006, due to ~~the addition of~~ lower average percentage rates on the prime and near prime loans purchased through the BVAC ~~platform.~~and LBAC platforms.

Net margin is the difference between finance charge and other income earned on our receivables and the cost to fund the receivables as well as the cost of debt incurred for general corporate purposes.

Our net margin as reflected on the consolidated statements of income is as follows (in thousands):


	Three Months Ended December 31,						Three Months Ended March 31,
	2006			2005			2007			2006
Finance charge income	$	502,217		$	394,075		$	564,104		$	414,440
Other income ~~(a)~~		36,244			23,761			34,797			25,658
Interest expense		(155,860	)		(101,179	)		(186,610	)		(107,106	)

Net margin	$	382,601		$	316,657		$	412,291		$	332,992

The decrease in net margin for the three months ended ~~December~~March 31, ~~2006,~~2007, as compared to the three months ended ~~December~~March 31, ~~2005,~~2006, was a result of the lower effective yield on the higher quality BVAC ~~portfolio,~~and LBAC portfolios, combined with an increase in interest expense ~~due to higher~~caused by an increase in market interest ~~rates.~~rates affecting the cost of short-term borrowings on our credit facilities, higher average utilization of our credit facilities, an increase in leverage and a continued run-off of older securitizations with lower interest costs. The net margin as a percentage of average finance receivables, excluding the BVAC and LBAC portfolios, was 12.7% for the three months ended March 31, 2007.

Finance charge income increased by ~~27%~~36% to ~~$502.2~~$564.1 million for the three months ended ~~December~~March 31, ~~2006,~~2007, from ~~$394.1~~$414.4 million for the three months ended ~~December~~March 31, ~~2005,~~2006, primarily due to the increase in average finance receivables. Our effective yield on our finance receivables decreased to ~~16.1%~~15.6% for the three months ended ~~December~~March 31, ~~2006,~~2007, from ~~16.3%~~16.6% for the three months ended ~~December~~March 31, ~~2005.~~2006. The effective yield represents finance charges and fees taken into earnings during the period as a percentage of average finance receivables and may be lower than the contractual rates of our finance contracts due to finance receivables in nonaccrual status. The decrease in the effective yield is due mainly to a lower effective yield on the BVAC ~~portfolio.~~and LBAC portfolios.


	Three Months Ended December 31,				Three Months Ended March 31,
	2006		2005		2007		2006
Servicing fees – gain on sale	$	315	$	10,450	$	132	$	6,977
Accretion		664		10,995		439		8,029

	$	979	$	21,445	$	571	$	15,006

Average gain on sale receivables	$	58,069	$	1,445,804	$	31,500	$	902,246

Servicing fees are earned from servicing domestic finance receivables sold to gain on sale Trusts. Servicing fees decreased as a result of the runoff of our gain on sale receivables portfolio.

The present value discount related to our credit enhancement assets represents the risk-adjusted time value of money on estimated cash flows. The present value discount on credit enhancement assets is accreted into earnings over the life of the credit enhancement assets using the effective interest method. Additionally, unrealized gains on credit enhancement assets reflected in accumulated other comprehensive income are also accreted into earnings over the life of the credit enhancement assets using the effective interest method. We recognized accretion of ~~$664,000~~$439,000 and ~~$11.0~~$8.0 million during the three months ended ~~December~~March 31, ~~2006~~2007 and ~~2005,~~2006, respectively. We reduce accretion of the present value discount in a period when such accretion would cause an other-than-temporary impairment in a securitization Trust. Accretion is reduced on the securitization Trust and an other-than-temporary impairment is recorded in an amount equal to the amount by which the reference amount exceeds the revised value of the related credit enhancement assets. Future period accretion is subsequently recognized based upon the revised value and recorded over the remaining expected life of the securitization Trust.


	Three Months Ended December 31,				Three Months Ended March 31,
	2006		2005		2007		2006
Investment income	$	24,860	$	15,145	$	20,063	$	13,750
Gain on sale of equity investment		36,196		8,847
Late fees and other income		11,384		8,616		14,734		11,908

	$	72,440	$	32,608	$	34,797	$	25,658

Investment income increased as a result of higher invested cash balances combined with increased market interest rates.

We held an equity investment in DealerTrack Holdings, Inc. (“DealerTrack”), a leading provider of on-demand software and data solutions that utilizes the internet to link automotive

dealers with banks, finance companies, credit unions and other financing sources. During the three months ended ~~December~~March 31, ~~2005, DealerTrack completed an initial public offering (“IPO”) of its common stock. As part of the IPO,~~2007, we sold ~~758,526 shares with an average cost~~our remaining investment in DealerTrack, consisting of ~~$4.15 per share for net proceeds of $15.81 per share, resulting in an $8.8 million gain. During the three months ended December 31, 2006, we sold an additional 1,954,361~~689,881 shares for net proceeds of ~~$22.67~~$27.05 per share, resulting in a ~~$36.2~~$15.8 million gain.

Operating expenses increased to ~~$94.1~~$109.4 million for the three months ended ~~December~~March 31, ~~2006,~~2007, from ~~$83.9~~$89.7 million for the three months ended ~~December~~March 31, ~~2005,~~2006. Our operating expenses are predominately related to personnel costs that include base salary and wages, performance incentives and benefits as well as related employment taxes. Personnel costs represented 77.7% and 79.4% of total operating expenses for the three months ended March 31, 2007 and 2006, respectively. The increase in personnel costs is due to ~~increased costs~~an increase in personnel to support a greater origination volume and ~~increased~~the increase in outstanding finance receivables.

Provisions for loan losses are charged to income to bring our allowance for loan losses to a level which management considers adequate to absorb probable credit losses inherent in the portfolio of finance receivables. The provision for loan losses recorded for the three months ended ~~December~~March 31, ~~2006~~2007 and ~~2005,~~2006, reflects inherent losses on receivables originated during those quarters and changes in the amount of inherent losses on receivables originated in prior periods. The provision for loan losses increased to ~~$174.8~~$189.0 million for the three months ended ~~December~~March 31, ~~2006,~~2007, from ~~$125.9~~$118.8 million for the three months ended ~~December~~March 31, ~~2005,~~2006, as a result of an increase in finance receivables. As an annualized percentage of average finance receivables, the provision for loan losses was ~~5.6%~~5.2% and ~~5.2%~~4.8% for the three months ended ~~December~~March 31, 2007 and 2006, respectively. The provision for loan losses as an annualized percentage of average finance receivables was unusually low for the three months ended March 31, 2006, due to a revision to our estimated losses from Hurricane Katrina and ~~2005, respectively.~~favorable changes to credit loss assumptions, including higher recovery rates.

Interest expense increased to ~~$155.9~~$186.6 million for the three months ended ~~December~~March 31, ~~2006,~~2007, from ~~$101.2~~$107.1 million for the three months ended ~~December~~March 31, ~~2005.~~2006. Average debt outstanding was ~~$12,034.4~~$13,992.4 million and ~~$9,064.4~~$9,242.7 million for the three months ended ~~December~~March 31, ~~2006~~2007 and ~~2005,~~2006, respectively. Our effective rate of interest paid on our debt increased to ~~5.1%~~5.4% for the three months ended ~~December~~March 31, ~~2006,~~2007, compared to ~~4.4%~~4.7% for the three months ended ~~December~~March 31, ~~2005,~~ 2006,

due to an increase in market interest rates, ~~and~~ a continued run-off of older securitizations with lower interest ~~costs.~~costs and a slightly higher cost of funds for the LBAC debt caused by certain fair value adjustments we made in connection with the acquisition.

Our effective income tax rate was ~~36.7%~~19.9% and ~~36.8%~~37.0% for the three months ended ~~December~~March 31, 2007 and 2006, ~~and 2005,~~ respectively. As a result of the favorable resolution of prior contingent liabilities, we recorded a net reduction to the tax contingency balance of $21.0 million for the three months ended March 31, 2007.


	Three Months Ended December 31,						Three Months Ended March 31,
	2006			2005			2007			2006
Unrealized losses on credit enhancement assets	$	(171	)	$	(4,072	)
Unrealized (losses) gains on credit enhancement assets							$	(275	)	$	2,969
Unrealized (losses) gains on cash flow hedges		(973	)		838			(4,597	)		584
Increase in fair value of equity investment		6,131			53,359
(Decrease) increase in fair value of equity investment								(1,634	)		873
Reclassification of gain on sale of equity investment into earnings		(36,196	)		(8,847	)		(15,801	)
Canadian currency translation adjustment		(4,104	)		(16	)		955			(547	)
Income tax benefit (provision)		11,442			(15,211	)		7,469			(1,644	)

	$	(23,871	)	$	26,051		$	(13,883	)	$	2,235

Unrealized ~~losses~~(losses) gains on credit enhancement assets consisted of the following (in thousands):


	Three Months Ended December 31,						Three Months Ended March 31,
	2006			2005			2007			2006
Unrealized gains (losses) related to changes in credit loss assumptions	$	24		$	(2,671	)
Unrealized (losses) gains related to changes in credit loss assumptions							$	(135	)	$	3,533
Unrealized gains related to changes in interest rates		7			161			2			67
Reclassification of unrealized gains into earnings through accretion		(202	)		(1,562	)		(142	)		(631	)

	$	(171	)	$	(4,072	)	$	(275	)	$	2,969

Changes in the fair value of credit enhancement assets as a result of modifications to the credit loss assumptions are reported as unrealized gains in other comprehensive (loss) income until realized. Unrealized losses are reported as a reduction in unrealized gains to the extent that there are unrealized gains. If there are no unrealized gains to offset the unrealized losses, the losses are considered to be other-than-temporary and are charged to operations. The cumulative credit loss assumptions used to estimate the fair value of credit enhancement assets are periodically reviewed by us and modified to reflect the actual credit performance for each securitization pool through the reporting date as well as estimates of future losses considering several factors including changes in the general economy. Differences between cumulative credit loss assumptions used in individual securitization pools can be attributed to the original credit attributes of a pool, actual credit performance through the reporting date and pool seasoning to the extent that changes in economic trends will have more of an impact on the expected future performance of less seasoned pools.

We updated the cumulative credit loss assumptions used in measuring the fair value of credit enhancement assets resulting in the recognition of unrealized ~~gains~~losses of ~~$24,000~~$135,000 for the three months ended ~~December~~March 31, ~~2006,~~2007 and unrealized ~~losses~~gains of ~~$2.7~~$3.5 million for the three months ended ~~December~~March 31, ~~2005.~~2006.

Net unrealized gains of ~~$202,000~~$142,000 and ~~$1.6 million~~$631,000 were reclassified into earnings through accretion during the three months ended ~~December~~March 31, 2007 and 2006, ~~and 2005,~~ respectively.

Unrealized (losses) gains on cash flow hedges consisted of the following (in thousands):


	Three Months Ended December 31,						Three Months Ended March 31,
	2006			2005			2007			2006
Unrealized gains related to changes in fair value	$	1,683		$	3,316
Unrealized (losses) gains related to changes in fair value							$	(2,457	)	$	4,159
Reclassification of net unrealized gains into earnings		(2,656	)		(2,478	)		(2,140	)		(3,575	)

	$	(973	)	$	838		$	(4,597	)	$	584

Unrealized (losses) gains related to changes in fair value for the three months ended ~~December~~March 31, ~~2006~~2007 and ~~2005,~~2006, were primarily due to changes in the fair value of interest rate swap agreements that were designated as cash flow hedges for accounting purposes. The fair value of the interest rate swap agreements fluctuates based upon changes in forward interest rate expectations.

Unrealized gains or losses on cash flow hedges ~~of our floating rate debt~~ are reclassified into earnings when interest rate fluctuations on securitization notes payable or other hedged items affect earnings.

We owned 689,881 and 2,644,242 shares of DealerTrack with a market value of $29.42 and ~~$22.11~~$20.98 per share at December 31, 2006 and ~~June 30, 2006,~~2005, respectively. ~~This~~The equity investment iswas classified as available for sale, and changes in its ~~market~~fair value ~~are~~were reflected in other comprehensive income. ~~At December~~We recorded a $1.6 million decrease and a $0.9 million increase in the fair value due to changes in market value per share of the equity investment during the three months ended March 31, 2007 and June 30, 2006, the investment is included in other assets on the consolidated balance sheets and valued at $20.3 million and $58.5 million, respectively. Included in accumulated other comprehensive income on the consolidated balance sheets is $17.4 million and $47.5 million in unrealized gains related to our investment in DealerTrack at December 31 and June 30, 2006, respectively.

~~In October 2006, DealerTrack completed a secondary public offering of its common stock. As part of~~During the ~~offering, we sold 1,954,361 shares for net proceeds of $22.67 per share, resulting in a $36.2 million pre-tax gain.~~

~~In January~~three months ended March 31, 2007, we sold our remaining investment in DealerTrack ~~consisting of 689,881 shares,~~ for net proceeds of $27.05 per share, resulting in a $15.8 million ~~pre-tax~~ gain.

Canadian currency translation adjustment gains of $955,000 and losses of ~~$4.1 million and $16,000~~$547,000 for the three months ended ~~December~~March 31, ~~2006~~2007 and ~~2005,~~2006, respectively, were included in other comprehensive (loss) income. The translation adjustment is due to the change in the value of our Canadian dollar denominated assets related to the change in the U.S. dollar to Canadian dollar conversion rates during the three months ended ~~December~~March 31, ~~2006~~2007 and ~~2005.~~2006. We do not anticipate the settlement of intercompany transactions with our Canadian subsidiaries in the foreseeable future.

~~Six~~Nine Months Ended ~~December~~March 31, ~~2006~~2007 as compared to ~~Six~~Nine Months Ended ~~December~~March 31, ~~2005~~2006


	Six Months Ended December 31,						Nine Months Ended March 31,
	2006			2005			2007			2006
Balance at beginning of period	$	11,775,665		$	8,838,968		$	11,775,665		$	8,838,968
LBAC acquisition								1,784,263
Loans purchased		3,424,736			2,859,672			5,939,004			4,473,939
Loans repurchased from gain on sale Trusts		315,153			378,683			315,153			562,033
Liquidations and other		(2,966,629	)		(2,203,720	)		(4,690,178	)		(3,492,435	)

Balance at end of period	$	12,548,925		$	9,873,603		$	15,123,907		$	10,382,505

Average finance receivables	$	12,173,441		$	9,312,002		$	12,993,241		$	9,575,795

The increase in loans purchased during the ~~six~~nine months ended ~~December~~March 31, ~~2006,~~2007, as compared to the ~~six~~nine months ended ~~December~~March 31, ~~2005,~~2006, was due to the addition of dealer relationship managers and branch office staff resulting in relationships with more auto dealers, increased penetration in existing dealer relationships and originations of ~~$263.5~~$438.7 million and $322.9 million through the BVAC ~~platform.~~and LBAC platforms, respectively. The increase in liquidations and other resulted primarily from increased collections and charge-offs on finance receivables due to the increase in ~~average~~ finance receivables and average age, or seasoning, of the portfolio.

The average new loan size ~~was $18,078~~increased to $18,185 for the ~~six~~nine months ended ~~December~~March 31, 2007, from $17,280 for the nine months ended March 31, 2006, ~~compared~~due to ~~$17,424 for~~ the ~~six months ended December 31, 2005.~~addition of loans purchased through the BVAC and LBAC platforms which are generally higher in quality and larger in size. The

average annual percentage rate for finance receivables purchased during the ~~six~~nine months ended ~~December~~March 31, 2007, decreased to 16.1% from 16.7% during the nine months ended March 31, 2006, ~~decreased to 16.4% from 16.6% during the six months ended December 31, 2005,~~ due to ~~the addition of~~ lower average percentage rates on the prime and near prime loans purchased through the BVAC ~~platform.~~and LBAC platforms.

Our net margin as reflected on the consolidated statements of income is as follows (in thousands):


	Six Months Ended December 31,						Nine Months Ended March 31,
	2006			2005			2007			2006
Finance charge income	$	986,574		$	767,811		$	1,550,678		$	1,182,251
Other income ~~(a)~~		68,049			44,947			102,846			70,605
Interest expense		(299,331	)		(191,450	)		(485,941	)		(298,556	)

Net margin	$	755,292		$	621,308		$	1,167,583		$	954,300

The decrease in net margin for the ~~six~~nine months ended ~~December~~March 31, ~~2006,~~2007, as compared to the ~~six~~nine months ended ~~December~~March 31, ~~2005,~~2006, was a result of the lower effective yield on the higher quality BVAC ~~portfolio,~~and LBAC portfolios, combined with an increase in interest expense ~~due to higher~~caused by an increase in market interest ~~rates.~~rates affecting the cost of short-term borrowings on our credit facilities, higher average utilization of our credit facilities, an increase in leverage and a continued run-off of older securitizations with lower interest costs. The net margin as a percentage of average finance receivables, excluding the BVAC and LBAC portfolios, was 12.9% for the nine months ended March 31, 2007.

Finance charge income increased by ~~28%~~31% to ~~$986.6~~$1,550.7 million for the ~~six~~nine months ended ~~December~~March 31, ~~2006,~~2007, from ~~$767.8~~$1,182.3 million for the ~~six~~nine months ended ~~December~~March 31, ~~2005,~~2006, primarily due to the increase in average finance receivables. Our effective yield on our finance receivables decreased to ~~16.1%~~15.9% for the ~~six~~

nine months ended ~~December~~March 31, ~~2006,~~2007, from ~~16.3%~~16.5% for the ~~six~~nine months ended ~~December~~March 31, ~~2005.~~2006. The effective yield represents finance charges and fees taken into earnings during the period as a percentage of average finance receivables and may be lower than the contractual rates of our finance contracts due to finance receivables in nonaccrual status. The decrease in the effective yield is due mainly to a lower effective yield on the BVAC ~~portfolio.~~and LBAC portfolios.


	Six Months Ended December 31,					Nine Months Ended March 31,
	2006		2005			2007		2006
Servicing fees – gain on sale	$	2,483	$	24,585		$	2,615	$	31,562
Other-than-temporary impairment				(457	)				(457	)
Accretion		5,955		22,658			6,394		30,687

	$	8,438	$	46,786		$	9,009	$	61,792

Average gain on sale receivables	$	181,432	$	1,708,097		$	132,185	$	1,443,547

Servicing fees are earned from servicing domestic finance receivables sold to gain on sale Trusts. Servicing fees decreased as a result of the runoff of our gain on sale receivables portfolio. Servicing fees were ~~2.7%~~2.6% and ~~2.9%~~3.0%, annualized, of average gain on sale receivables for the ~~six~~nine months ended ~~December~~March 31, ~~2006~~2007 and ~~2005,~~2006, respectively.

Other-than-temporary impairment of $457,000 for the ~~six~~nine months ended ~~December~~March 31, ~~2005,~~2006, resulted from higher than forecasted default rates in certain gain on sale Trusts.

The present value discount related to our credit enhancement assets represents the risk-adjusted time value of money on estimated cash flows. The present value discount on credit enhancement assets is accreted into earnings over the life of the credit enhancement assets using the effective interest method. Additionally, unrealized gains on credit enhancement assets reflected in accumulated other comprehensive income are also accreted into earnings over the life of the credit enhancement assets using the effective interest method. We recognized accretion of ~~$6.0~~$6.4 million and ~~$22.7~~$30.7 million during the ~~six~~nine months ended ~~December~~March 31, ~~2006~~2007 and ~~2005,~~2006, respectively. We reduce accretion of the present value discount in a period when such accretion would cause an other-than-temporary impairment in a securitization Trust. Accretion is reduced on the securitization Trust and an other-than-temporary impairment is recorded in an amount equal to the amount by which the reference amount exceeds the revised value of the related credit enhancement assets. Future period accretion is subsequently recognized based upon the revised value and recorded over the remaining expected life of the securitization Trust.


	Six Months Ended December 31,				Nine Months Ended March 31,
	2006		2005		2007		2006
Investment income	$	45,900	$	27,263	$	65,963	$	41,013
Gain on sale of equity investment		36,196		8,847
Late fees and other income		22,149		17,684		36,883		29,592

	$	104,245	$	53,794	$	102,846	$	70,605

Investment income increased as a result of higher invested cash balances combined with increased market interest rates.

We held an equity investment in DealerTrack, a leading provider of on-demand software and data solutions that utilizes the internet to link automotive dealers with banks, finance companies, credit unions and other financing sources. During the ~~six~~nine months ended ~~December~~March 31, ~~2005,~~2006, DealerTrack completed an IPO of its common stock. As part of the IPO, we sold 758,526 shares at an average cost of $4.15 per share for net proceeds of $15.81 per share, resulting in an $8.8 million gain. During the ~~six~~nine months ended ~~December~~March 31, ~~2006,~~2007, we sold ~~an additional 1,954,361~~our remaining investment in DealerTrack, consisting of 2,644,242 shares for net proceeds of ~~$22.67~~$23.81 per share, resulting in a ~~$36.2~~$52.0 million gain.

Operating expenses increased to ~~$182.4~~$291.9 million for the ~~six~~nine months ended ~~December~~March 31, ~~2006, from $161.8~~2007, as compared to $251.5 million for the ~~six~~nine months ended ~~December~~March 31, ~~2005,~~2006. Our operating expenses are predominately related to personnel costs that include base salary and wages, performance incentives and benefits as well as related employment taxes. Personnel costs represented 76.8% and 77.2% of total operating expenses for the nine months ended March 31, 2007 and 2006, respectively. The increase in personnel costs is due to ~~increased costs~~an increase in personnel to support a greater origination volume and ~~increased~~the increase in outstanding finance receivables.

nine months ended ~~December~~March 31, ~~2006,~~2007, from ~~$291.7~~$410.5 million for the ~~six~~nine months ended ~~December~~March 31, ~~2005,~~2006, as a result of an increase in finance receivables. As an annualized percentage of average finance receivables, the provision for loan losses was ~~5.7%~~5.5% and ~~6.2%~~5.7% for the ~~six~~nine months ended ~~December~~March 31, 2007 and 2006, respectively. The decrease in the provision for loan losses as an annualized percentage of average finance receivables reflects the inclusion of the higher quality prime and ~~2005, respectively.~~near prime BVAC and LBAC portfolios for the nine months ended March 31, 2007.

Interest expense increased to ~~$299.3~~$485.9 million for the ~~six~~nine months ended ~~December~~March 31, ~~2006,~~2007, from ~~$191.5~~$298.6 million for the ~~six~~nine months ended ~~December~~March 31, ~~2005.~~2006. Average debt outstanding was ~~$11,584.3~~$12,375.2 million and ~~$8,761.7~~$8,919.5 million for the ~~six~~nine months ended ~~December~~March 31, ~~2006~~2007 and ~~2005,~~2006, respectively. Our effective rate of interest paid on our debt increased to ~~5.1%~~5.2% for the ~~six~~nine months ended ~~December~~March 31, ~~2006,~~2007, compared to ~~4.3%~~4.5% for the ~~six~~nine months ended ~~December~~March 31, ~~2005,~~2006, due to an increase in market interest rates, ~~and~~ a continued run-off of older securitizations with lower interest ~~costs.~~

Our effective income tax rate was ~~36.8%~~31.3% and 37.0% for the ~~six~~nine months ended ~~December~~March 31, 2007 and 2006, ~~and 2005,~~ respectively. As a result of the favorable resolution of prior contingent liabilities, we recorded a net reduction to the tax contingency balance of $21.0 million for the nine months ended March 31, 2007.


	Six Months Ended December 31,						Nine Months Ended March 31,
	2006			2005			2007			2006
Unrealized losses on credit enhancement assets	$	(2,781	)	$	(8,080	)	$	(3,056	)	$	(5,111	)
Unrealized (losses) gains on cash flow hedges		(9,228	)		9,044			(13,825	)		9,628
Increase in fair value of equity investment		6,131			53,359			4,497			54,232
Reclassification of gain on sale of equity investment into earnings		(36,196	)		(8,847	)		(51,997	)		(8,847	)
Canadian currency translation adjustment		(4,265	)		4,975			(3,310	)		4,428
Income tax benefit (provision)		15,437			(16,773	)		22,906			(18,417	)

	$	(30,902	)	$	33,678		$	(44,785	)	$	35,913

Unrealized losses on credit enhancement assets consisted of the following (in thousands):


	Six Months Ended December 31,						Nine Months Ended March 31,
	2006			2005			2007			2006
Unrealized gains (losses) related to changes in credit loss assumptions	$	391		$	(4,363	)	$	254		$	(600	)
Unrealized (losses) gains related to changes in interest rates		(16	)		495			(11	)		332
Reclassification of unrealized gains into earnings through accretion		(3,156	)		(4,212	)		(3,299	)		(4,843	)

	$	(2,781	)	$	(8,080	)	$	(3,056	)	$	(5,111	)

through the reporting date as well as estimates of future losses considering several factors including changes in the general economy. Differences between cumulative credit loss assumptions used in individual securitization pools can be attributed to the original credit attributes of a pool, actual credit performance through the reporting date and pool seasoning to the extent that changes in economic trends will have more of an impact on the expected future performance of less seasoned pools.

We updated the cumulative credit loss assumptions used in measuring the fair value of credit enhancement assets resulting in the recognition of unrealized gains of ~~$391,000~~$254,000 for the ~~six~~nine months ended ~~December~~March 31, ~~2006,~~2007, and unrealized losses of ~~$4.4 million~~$600,000 for the ~~six~~nine months ended ~~December~~March 31, ~~2005.~~2006.

Net unrealized gains of ~~$3.2~~$3.3 million and ~~$4.2~~$4.8 million were reclassified into earnings through accretion during the ~~six~~nine months ended ~~December~~March 31, 2007 and 2006, ~~and 2005,~~ respectively.

Unrealized (losses) gains on cash flow hedges consisted of the following (in thousands):


	Six Months Ended December 31,						Nine Months Ended March 31,
	2006			2005			2007			2006
Unrealized (losses) gains related to changes in fair value	$	(1,013	)	$	11,800		$	(3,470	)	$	15,959
Reclassification of net unrealized gains into earnings		(8,215	)		(2,756	)		(10,355	)		(6,331	)

	$	(9,228	)	$	9,044		$	(13,825	)	$	9,628

Unrealized (losses) gains related to changes in fair value for the ~~six~~nine months ended ~~December~~March 31, ~~2006~~2007 and ~~2005,~~2006, were primarily due to changes in the fair value of interest rate swap agreements that were designated as cash flow hedges for accounting purposes. The fair value of the interest rate swap agreements fluctuates based upon changes in forward interest rate expectations.

During the nine months ended March 31, 2006, DealerTrack completed an initial public offering (“IPO”) of its common stock. At June 30, 2005, we owned shares of DealerTrack stock which were converted in the IPO to 3,402,768 shares of common stock with an average cost of $4.15 per share. As part of the IPO, we sold 758,526 shares for net proceeds of $15.81 per share resulting in an $8.8 million gain. We owned ~~689,881 and~~ 2,644,242 shares of DealerTrack with a market value of ~~$29.42 and~~ $22.11 per share at ~~December 31 and~~ June 30, ~~2006, respectively. This~~2006. During the nine months ended March 31, 2007, we sold our remaining investment in DealerTrack for net proceeds of $23.81 per share, resulting in a $52.0 million gain. The equity investment iswas classified as available for sale, and changes in its market value ~~are~~were reflected in other comprehensive income. ~~At December 31 and June 30, 2006, the investment is included in other assets on the consolidated~~

~~balance sheets and valued at $20.3~~We recorded a $4.5 million and ~~$58.5~~$54.2 million ~~respectively. Included~~increase in ~~accumulated other comprehensive income on~~ the ~~consolidated balance sheets is $17.4 million and $47.5 million~~fair value due to changes in ~~unrealized gains related to our investment in DealerTrack at December 31 and June 30, 2006, respectively.~~

~~In October 2006, DealerTrack completed a secondary public offering of its common stock. As part~~market value per share of the ~~offering, we sold 1,954,361 shares for net proceeds of $22.67 per share, resulting in a $36.2 million pre-tax gain.~~

~~In January~~equity investment during the nine months ended March 31, 2007 ~~we sold our remaining investment in DealerTrack, consisting of 689,881 shares, for net proceeds of $27.05 per share, resulting in a $15.8 million pre-tax gain.~~and 2006, respectively.

Canadian currency translation adjustment losses of ~~$4.3~~$3.3 million and gains of ~~$5.0~~$4.4 million for the ~~six~~nine months ended ~~December~~March 31, ~~2006~~2007 and ~~2005,~~2006, respectively, were included in other comprehensive (loss) income. The translation adjustment is due to the change in the value of our Canadian dollar denominated assets related to the change in the U.S. dollar to Canadian dollar conversion rates during the ~~six~~nine months ended ~~December~~March 31, ~~2006~~2007 and ~~2005.~~2006. We do not anticipate the settlement of intercompany transactions with our Canadian subsidiaries in the foreseeable future.

We provide financing primarily in relatively high-risk markets, and, therefore, anticipate a corresponding high level of delinquencies and charge-offs.

Finance receivables on our balance sheets include receivables purchased but not yet securitized and receivables securitized in transactions which are structured as secured financings. Provisions for loan losses are charged to operations in amounts sufficient to maintain the allowance for loan losses on the balance sheet at a level considered adequate to cover probable credit losses inherent in finance receivables.

Prior to October 1, 2002, we periodically sold receivables to Trusts in securitization transactions accounted for as a sale of receivables. We also acquired two securitization Trusts which were accounted for as sales of finance receivables. We retain an interest in the receivables sold in the form of credit enhancement assets. Credit enhancement assets are reflected on our balance sheets at estimated fair value, calculated based upon the present value of estimated excess future cash flows from the Trusts using, among other assumptions, estimates of future credit losses on the receivables sold. Receivables sold to Trusts that are subsequently charged off decrease the amount of excess future cash flows from the Trusts. If such charge-offs are expected to exceed our estimates of cumulative credit losses or if the actual timing of these losses differs from expected timing, the fair value of credit enhancement assets is written down through an other-than-temporary impairment charge to earnings to the extent the write-down exceeds any previously recorded unrealized gain.

The following tables present certain data related to the receivables portfolio (dollars in thousands):


	December 31, 2006							March 31, 2007
	Finance Receivables			Gain on Sale		Total Managed		Finance Receivables			Gain on Sale		Total Managed
Principal amount of receivables, net of fees	$	12,548,925		$	34,083	$	12,583,008	$	15,123,907		$	28,979	$	15,152,886

Nonaccretable acquisition fees		(178,405	)						(141,474	)
Allowance for loan losses		(513,135	)						(614,986	)

Receivables, net	$	11,857,385						$	14,367,447

Number of outstanding contracts		968,936			2,471		971,407		1,113,851			2,256		1,116,107

Average carrying amount of outstanding contract (in dollars)	$	12,951		$	13,793	$	12,953	$	13,578		$	12,845	$	13,577

Allowance for loan losses and nonaccretable acquisition fees as a percentage of receivables		5.5	%						5.0	%


	June 30, 2006
	Finance Receivables			Gain on Sale		Total Managed
Principal amount of receivables, net of fees	$	11,775,665		$	421,037	$	12,196,702

Nonaccretable acquisition fees		(203,128	)
Allowance for loan losses		(475,529	)

Receivables, net	$	11,097,008

Number of outstanding contracts		917,484			54,844		972,328

Average carrying amount of outstanding contract (in dollars)	$	12,835		$	7,677	$	12,544

Allowance for loan losses and nonaccretable acquisition fees as a percentage of receivables		5.8	%

The decrease in the allowance for loan losses and nonaccretable acquisition fees as a percentage of receivables at ~~December~~March 31, ~~2006,~~2007, compared to June 30, 2006, is primarily due to ~~a change in~~ the ~~timing~~inclusion of ~~losses due to bankruptcy law changes. Additionally, we increased estimates~~the LBAC portfolio as well as growth of ~~recovery rates as we continue to expect stability in used vehicle prices.~~the BVAC portfolio.

The following is a summary of finance receivables that are (i) more than 30 days delinquent, but not yet in repossession, and (ii) in repossession, but not yet charged off (dollars in thousands):


	December 31, 2006												March 31, 2007
	Finance Receivables				Gain on Sale				Total Managed				Finance Receivables				Gain on Sale				Total Managed
	Amount		Percent		Amount		Percent		Amount		Percent		Amount		Percent		Amount		Percent		Amount		Percent
Delinquent contracts:
31 to 60 days	$	845,140	6.7	%	$	438	1.3	%	$	845,578	6.7	%	$	616,655	4.1	%	$	229	0.8	%	$	616,884	4.1	%
Greater than 60 days		320,217	2.6			102	0.3			320,319	2.6			224,829	1.5			123	0.4			224,952	1.5

		1,165,357	9.3			540	1.6			1,165,897	9.3			841,484	5.6			352	1.2			841,836	5.6
In repossession		42,909	0.3			53	0.1			42,962	0.3			37,004	0.2			12	0.1			37,016	0.2

	$	1,208,266	9.6	%	$	593	1.7	%	$	1,208,859	9.6	%	$	878,488	5.8	%	$	364	1.3	%	$	878,852	5.8	%


	December 31, 2005
	Finance Receivables				Gain on Sale				Total Managed
	Amount		Percent		Amount		Percent		Amount		Percent
Delinquent contracts:
31 to 60 days	$	594,053	6.0	%	$	124,463	11.1	%	$	718,516	6.5	%
Greater than 60 days		247,011	2.5			58,843	5.2			305,854	2.8

		841,064	8.5			183,306	16.3			1,024,370	9.3
In repossession		31,436	0.3			6,163	0.5			37,599	0.4

	$	872,500	8.8	%	$	189,469	16.8	%	$	1,061,969	9.7	%

An account is considered delinquent if a substantial portion of a scheduled payment has not been received by the date such payment was contractually due. Delinquencies in our managed receivables portfolio may vary from period to period based upon the average age or seasoning of the portfolio, seasonality within the calendar year and economic factors. Due to our primary target customer base, a relatively high percentage of accounts become delinquent at some point in the life of a loan and there is a high rate of account movement between current and delinquent status in the portfolio.

Delinquencies in finance receivables were ~~higher~~lower at ~~December~~March 31, ~~2006,~~2007, as compared to ~~December~~March 31, ~~2005,~~2006, as a result of ~~seasoning~~the inclusion of the ~~finance receivables.~~prime and near prime BVAC and LBAC portfolios.

In accordance with our policies and guidelines, we, at times, offer payment deferrals to consumers whereby the consumer is allowed to move up to two delinquent payments to the end of the loan generally by paying a fee (approximately the interest portion of the payment deferred, except where state law provides for a lesser amount). Our policies and guidelines limit the number and frequency of deferments that may be granted. Our policies and guidelines generally limit the granting of deferments on new accounts until a requisite number of payments have been received. Due to the nature of our primary customer base and policies and guidelines of the deferral program, approximately 50% of accounts currently comprising the managed portfolio will receive a deferral at some point in the life of the account.

An account for which all delinquent payments are deferred is classified as current at the time the deferment is granted and therefore is not included as a delinquent account. Thereafter, such account is aged based on the timely payment of future installments in the same manner as any other account.

Contracts receiving a payment deferral as an average quarterly percentage of average receivables outstanding were as follows:


	Three Months Ended December 31,				Six Months Ended December 31,				Three Months Ended March 31,				Nine Months Ended March 31,
	2006		2005		2006		2005		2007		2006		2007		2006
Finance receivables:
(as a percentage of average finance receivables)	6.8	%	6.4	%	6.5	%	6.4	%	5.0	%	5.4	%	6.0	%	6.1	%

Gain on sale receivables:
(as a percentage of average gain on sale receivables)	1.3	%	9.5	%	3.5	%	10.1	%	1.5	%	7.4	%	2.8	%	9.2	%

Total managed portfolio:
(as a percentage of average managed receivables)	6.7	%	6.8	%	6.5	%	7.0	%	5.0	%	5.6	%	6.0	%	6.5	%

The decrease in the accounts receiving a payment deferral as a percentage of average managed receivables for the three and ~~six~~nine months ended ~~December~~March 31, ~~2006,~~2007, as compared to the three and ~~six~~nine months ended ~~December~~March 31, ~~2005,~~2006, is primarily a result of higher levels of deferrals that were granted in ~~2005 in connection with Hurricane Katrina. Deferments granted~~the 2006 periods in connection with Hurricane Katrina ~~increased~~and inclusion of the ~~percentage of deferments granted by 0.7% to 6.8% overall~~LBAC and ~~by 0.6% to 7.0% overall for the three and six months ended December 31, 2005, respectively.~~BVAC portfolios.

The following is a summary of deferrals as a percentage of finance receivables outstanding:


	December 31, 2006						March 31, 2007
	Finance Receivables		Gain on Sale		Total Managed		Finance Receivables		Gain on Sale		Total Managed
Never deferred	77.5	%	97.1	%	77.5	%	80.6	%	95.6	%	80.6	%
Deferred:
1-2 times	18.5		2.9		18.5		16.1		4.4		16.1
3-4 times	4.0				4.0		3.3				3.3

Total deferred	22.5		2.9		22.5		19.4		4.4		19.4

Total	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%


	June 30, 2006
	Finance Receivables		Gain on Sale		Total Managed
Never deferred	78.7	%	38.7	%	77.3	%
Deferred:
1-2 times	17.4		35.9		18.1
3-4 times	3.8		25.3		4.5
Greater than 4 times	0.1		0.1		0.1

Total deferred	21.3		61.3		22.7

Total	100.0	%	100.0	%	100.0	%

We evaluate the results of our deferment strategies based upon the amount of cash installments that are collected on accounts after they have been deferred versus the extent to which the collateral underlying the deferred accounts has depreciated over the same period of time. Based on this evaluation, we believe that payment deferrals granted according to our policies and guidelines are an effective portfolio management technique and result in higher ultimate cash collections from the portfolio.

Changes in deferment levels do not have a direct impact on the ultimate amount of finance receivables charged off by us. However, the timing of a charge-off may be affected if the previously deferred account ultimately results in a charge-off. To the extent that deferrals impact the ultimate timing of when an account is charged off, historical charge-off ratios and loss confirmation periods used in the determination of the adequacy of our allowance for loan losses are also impacted. Increased use of deferrals may result in a lengthening of the loss confirmation period, which would increase expectations of credit losses inherent in the loan portfolio and therefore increase the allowance for loan losses and related provision for loan losses. Changes in these ratios and periods are considered in determining the appropriate level of allowance for loan losses and related provision for loan losses.

The following table presents charge-off data with respect to our managed finance receivables portfolio (dollars in thousands):


	Three Months Ended December 31,						Six Months Ended December 31,						Three Months Ended March 31,						Nine Months Ended March 31,
	2006			2005			2006			2005			2007			2006			2007			2006
Finance receivables:
Repossession charge-offs	$	289,903		$	186,617		$	512,996		$	344,314		$	293,861		$	222,392		$	806,857		$	566,706
Less: Recoveries		(141,452	)		(89,661	)		(250,241	)		(164,743	)		(145,489	)		(112,479	)		(395,730	)		(277,222	)
Mandatory charge-offs (a)		34,702			31,387			82,262			57,945			16,745			12,206			99,007			70,151

Net charge-offs	$	183,153		$	128,343		$	345,017		$	237,516		$	165,117		$	122,119		$	510,134		$	359,635

Gain on sale:
Repossession charge-offs	$	973		$	55,332		$	10,527		$	127,716		$	211		$	37,828		$	10,738		$	165,544
Less: Recoveries		(417	)		(22,598	)		(4,584	)		(51,457	)		(128	)		(17,027	)		(4,712	)		(68,484	)
Mandatory charge-offs (a)		(272	)		3,923			(1,127	)		8,380			(25	)		(1,781	)		(1,152	)		6,599

Net charge-offs	$	284		$	36,657		$	4,816		$	84,639		$	58		$	19,020		$	4,874		$	103,659

Total managed:
Repossession charge-offs	$	290,876		$	241,949		$	523,523		$	472,030		$	294,072		$	260,220		$	817,595		$	732,250
Less: Recoveries		(141,869	)		(112,259	)		(254,825	)		(216,200	)		(145,617	)		(129,506	)		(400,442	)		(345,706	)
Mandatory charge-offs (a)		34,430			35,310			81,135			66,325			16,720			10,425			97,855			76,750

Net charge-offs	$	183,437		$	165,000		$	349,833		$	322,155		$	165,175		$	141,139		$	515,008		$	463,294

Net charge-offs as an annualized percentage of average receivables:
Finance receivables		5.9	%		5.3	%		5.6	%		5.1	%		4.6	%		4.9	%		5.2	%		5.0	%

Gain on sale receivables		1.9	%		10.1	%		5.3	%		9.8	%		0.7	%		8.5	%		4.9	%		9.6	%

Total managed portfolio		5.8	%		5.9	%		5.6	%		5.8	%		4.6	%		5.2	%		5.2	%		5.6	%

Recoveries as a percentage of gross repossession charge-offs:
Recoveries as a percentage of gross repossession charge- offs:
Finance receivables		48.8	%		48.0	%		48.8	%		47.8	%		49.5	%		50.6	%		49.0	%		48.9	%

Gain on sale receivables		42.9	%		40.8	%		43.5	%		40.3	%		60.7	%		45.0	%		43.9	%		41.4	%

Total managed portfolio		48.8	%		46.4	%		48.7	%		45.8	%		49.5	%		49.8	%		49.0	%		47.2	%

Net charge-offs as an annualized percentage of average managed receivables outstanding may vary seasonally from period to period based upon the average age or seasoning of the portfolio and economic factors. The decrease in net charge-offs as an annualized ~~percent~~percentage of managed receivables for the three and ~~six~~nine months ended ~~December~~March 31, ~~2006,~~2007, as compared to the three and ~~six~~nine months ended ~~December~~March 31, ~~2005,~~2006, resulted primarily from the inclusion of the BVAC ~~portfolio combined with an overall improvement in recovery rates.~~and LBAC portfolios. Excluding BVAC and LBAC, net charge-offs as an annualized ~~percent~~percentage of the total managed portfolio were ~~6.2%~~5.2% and ~~6.0%~~5.7% for the three and ~~six~~nine months ended ~~December~~March 31, ~~2006,~~2007, respectively.

Our primary sources of cash have been finance charge income, servicing fees, distributions from securitization Trusts, net proceeds from the convertible senior notes transaction, borrowings under credit facilities, transfers of finance receivables to Trusts in securitization transactions and collections and recoveries on finance receivables. Our primary uses of cash have been purchases of finance receivables, repayment of credit facilities and securitization notes payable, funding credit enhancement requirements for securitization transactions and credit facilities, operating expenses, income taxes, acquisitions and stock repurchases.

We used cash of ~~$3,740.8~~$6,283.2 million and ~~$3,146.6~~$5,093.8 million for the purchase of finance receivables during the ~~six~~nine months ended ~~December~~March 31, ~~2006~~2007 and ~~2005,~~2006, respectively. These purchases were funded initially utilizing cash and credit facilities and subsequently through long-term financing in securitization transactions.

In the normal course of business, in addition to using our available cash, we pledge receivables and borrow under our credit facilities to fund our operations and repay these borrowings as appropriate under our cash management strategy.

As of ~~December~~March 31, ~~2006,~~2007, credit facilities consisted of the following (in millions):


Facility Type	Maturity (a)	Facility Amount		Advances Outstanding		Maturity (a)	Facility Amount		Advances Outstanding
Commercial paper facility	October 2009	$	2,500.0	$	386.1	October 2009	$	2,500.0	$	842.1
Medium term note facility	October 2009(b)		750.0		750.0	October 2009(b)		750.0		750.0
Repurchase facility	August 2007		600.0		550.0	August 2007		500.0		458.8
Near prime facility	July 2007		400.0		234.4	July 2007		400.0		252.9
Bay View credit facility	September 2007		650.0		480.4
BVAC credit facility						September 2007		650.0		592.0
LBAC credit facility						September 2007		600.0		109.0

		$	4,900.0	$	2,400.9		$	5,400.0	$	3,004.8

In July 2006, we renewed our near prime facility, extending the maturity to July 2007.

In August 2006, we amended our repurchase facility, increasing the facility limit to $600.0 million through February ~~2007. After February~~ 2007, after which the facility limit ~~will be~~was reduced to $500.0 million with a final maturity of August 2007.

In September 2006, we renewed our BVAC credit facility, extending the maturity to September 2007. In December 2006 and April 2007, we amended our BVAC credit facility, increasing the facility limit to $650.0 million and $750.0 million, respectively, through June 2007. After June 2007, the facility limit will be reduced to $450.0 million with a final maturity of September 2007.

In October 2006, we amended our commercial paper facility to increase the facility limit to $2,500.0 million and extended the maturity date to October 2009.

In October 2006, we entered into a $750.0 million medium term note facility that will mature in October 2009. This facility replaced the $650.0 million medium term note facility that was terminated in October 2006.

In March 2007, we renewed our LBAC credit facility, extending the maturity to September 2007.

Our credit facilities contain various covenants requiring certain minimum financial ratios, asset quality and portfolio performance ratios (portfolio net loss and delinquency ratios, and pool level cumulative net loss ratios) as well as limits on deferment levels. As of ~~December~~March 31, ~~2006,~~2007, we were in compliance with all covenants in our credit facilities.

We have completed 5557 securitization transactions through ~~December~~March 31, ~~2006,~~2007, excluding securitization Trusts ~~originated~~entered into by BVAC and LBAC prior to ~~its~~their acquisition by us. The proceeds from the transactions were primarily used to repay borrowings outstanding under our credit facilities.


Transaction		Date	Original Amount		Balance at December 31, 2006		Date	Original Amount		Balance at March 31, 2007
Gain on sale:
BV2003-LJ-1		August 2003	$	193.3	$	33.8	August 2003	$	193.3	$	28.8

Secured financing:
2003-A-M		April 2003		1,000.0		115.1
2003-B-X		May 2003		825.0		106.5	May 2003		825.0		86.0
2003-C-F		September 2003		915.0		116.8	September 2003		915.0		92.8
2003-D-M		October 2003		1,200.0		207.2	October 2003		1,200.0		174.1
2004-A-F		February 2004		750.0		143.6	February 2004		750.0		121.2
2004-B-M		April 2004		900.0		200.0	April 2004		900.0		171.0
2004-1		June 2004		575.0		143.2	June 2004		575.0		123.4
2004-C-A		August 2004		800.0		256.1	August 2004		800.0		224.7
2004-D-F		November 2004		750.0		269.5	November 2004		750.0		235.3
2005-A-X		February 2005		900.0		356.3	February 2005		900.0		314.3
2005-1		April 2005		750.0		279.8	April 2005		750.0		240.0
2005-B-M		June 2005		1,350.0		661.1	June 2005		1,350.0		583.9
2005-C-F		August 2005		1,100.0		621.0	August 2005		1,100.0		549.8
2005-D-A		November 2005		1,400.0		893.5	November 2005		1,400.0		794.3
2006-1		March 2006		945.0		659.3	March 2006		945.0		575.1
2006-R-M		May 2006		1,200.0		1,199.8	May 2006		1,200.0		1,199.9
2006-A-F		July 2006		1,350.0		1,183.1	July 2006		1,350.0		1,047.5
2006-B-G		September 2006		1,200.0		1,143.2	September 2006		1,200.0		1,035.5
2007-A-X							January 2007		1,200.0		1,145.7
BV2005-LJ-1		February 2005		232.1		107.8	February 2005		232.1		96.9
BV2005-LJ-2		July 2005		185.6		100.4	July 2005		185.6		90.2
BV2005-3		December 2005		220.1		144.2	December 2005		220.1		131.1
LB2003-B							June 2003		250.0		26.4
LB2003-C							October 2003		250.0		38.6
LB2004-A							March 2004		300.0		59.2
LB2004-B							July 2004		250.0		62.6
LB2004-C							December 2004		350.0		113.5
LB2005-A							June 2005		350.0		142.8
LB2005-B							October 2005		350.0		176.2
LB2006-A							May 2006		450.0		321.6
LB2006-B							September 2006		500.0		412.0
LB2007-A (b)							March 2007		498.3		498.3

Total secured financing transactions	Total secured financing transactions			18,547.8		8,907.5			22,296.1		10,883.9

Total active securitizations	Total active securitizations		$	18,741.1	$	8,941.3		$	22,489.4	$	10,912.7

We structure our securitization transactions as secured financings. Finance receivables are transferred to a securitization Trust, which is one of our special purpose finance subsidiaries, and the Trusts issue one or more series of asset-backed securities (securitization notes payable). While these Trusts are included in our consolidated financial statements, these Trusts are separate legal entities; thus the finance receivables and other assets held by these Trusts are legally owned by these Trusts, are available to satisfy the related securitization notes payable and are not available to our creditors or our other subsidiaries.

At the time of securitization of finance receivables, we are required to pledge assets equal to a specified percentage of the securitization pool to provide credit enhancement required for specific credit ratings for the asset-backed securities issued by the Trusts.

Generally, we employ two types of securitization structures. The structure we have utilized most frequently involves the purchase of a financial guaranty insurance policy issued by an insurer. Our most recent transaction completed in ~~January~~April 2007 excluded any receivables originated under the BVAC and LBAC platforms and had an initial cash ~~requirements~~deposit and overcollateralization ~~levels~~level of 9.0% and target credit enhancement of 13.0%. Under this structure, we typically expect to begin to receive cash distributions approximately ~~six~~seven to nine months after receivables are securitized. We completed a transaction including only receivables originated under the LBAC platform in March 2007 that had an initial credit enhancement level of 3.75% and target credit enhancement of 8.0%. We expect to begin to receive cash distributions for this transaction approximately eight to ten months after receivables are securitized. We have not yet completed a transaction involving receivables originated under the BVAC platform.

~~Our~~The second type of securitization structure we use involves the sale of subordinated asset-backed securities in order to provide credit enhancement for the senior asset-backed securities. Our most recent securitization transaction involving the sale of subordinated asset-backed securities was completed in March 2006 and required an initial cash deposit and overcollateralization level of 7.0% of the original receivable pool balance, and a target credit enhancement ~~levels must reach~~level of 16.5% of the receivable pool balance must be reached before excess cash is used to repay the Class E bonds. Subsequent to the payoff of Class E bonds, excess cash is distributed to us. Under this structure, we typically expect to begin to receive cash distributions approximately 22 to 26 months after receivables are securitized.

Increases or decreases to the credit enhancement level required in future securitization transactions will depend on the net interest margin of the finance receivables transferred, the collateral characteristics of the receivables transferred, credit performance trends of our finance receivables, our financial condition and the economic environment.

Cash flows related to securitization transactions were as follows (in millions):


	Six Months Ended December 31,				Nine Months Ended March 31,
	2006		2005		2007		2006
Initial credit enhancement deposits:
Secured financing Trusts:
Restricted cash	$	55.1	$	54.1	$	93.3	$	69.1
Overcollateralization		206.8		202.7		290.9		257.7
Distributions from Trusts:
Gain on sale Trusts		92.7		253.7		93.0		346.1
Secured financing Trusts		415.6		296.2		597.9		443.6

The agreements with the insurers of our securitization transactions covered by a financial guaranty insurance policy provide that if portfolio performance ratios (delinquency, cumulative default orand cumulative net loss) in a Trust’s pool of receivables exceed certain targets, the specified credit enhancement levels would be increased.

The agreements ~~that we enter into~~ with our ~~financial guaranty insurance providers in connection with securitization transactions~~insurers contain additional specified targeted portfolio performance ratios (delinquency, cumulative default and cumulative net loss) that are higher than the limits referred to above. If these higher limits are exceeded, we can be terminated as servicer for the securitization pools.

As of ~~December~~March 31, ~~2006,~~2007, no ~~such termination~~ events have occurred with respect to any of the Trusts formed or acquired by ~~us.~~us that would cause the specified credit enhancement levels to be increased or result in our termination as servicer.

In September 2006, we issued $550.0 million of convertible senior notes at par in a private offering to qualified institutional buyers under Rule 144A under the Securities Act of 1933, of which $275.0 million are due in 2011 bearing interest at a rate of 0.75% per annum and $275.0 million are due in 2013 bearing interest at a rate of 2.125% per annum. Interest on the notes is payable semiannually. Subject to certain conditions, the notes, which are uncollateralized, may be converted prior to maturity into shares of our common stock at an initial conversion price of $28.07 per share and $30.51 per share for the notes due in 2011 and 2013, respectively. Upon conversion, the conversion value will be paid in: 1) cash equal to the principal amount of the notes and 2) to the extent the conversion value exceeds the principal amount of the notes, shares of our common stock. The notes are convertible only in the following circumstances: 1) if the closing sale price of our common stock exceeds 130% of the conversion price during specified periods set forth in the indentures under which the notes were issued, 2) if the average trading price per $1,000 principal amount of the notes is less than or equal to 98% of the average conversion value of the notes during specified periods set forth in the indentures under which the notes were issued or 3) upon the occurrence of

specific corporate transactions set forth in the indentures under which the notes were issued. In connection with the issuance of the notes, we filed a shelf registration statement relating to the resale of the notes, the subsidiary guarantees and the shares of common stock into which the notes are convertible. If the registration statement ceases to remain effective, we will be required to pay additional interest to the noteholders during the time that the registration statement is not effective at a rate of 0.5% per annum through September 2008.

In connection with the issuance of these convertible senior notes, we used net proceeds of $246.8 million to purchase 10,109,500 shares of our common stock.

~~$28.07~~ $28.07 per share and $30.51 per share for the notes due in 2011 and 2013, respectively. These call options are expected to allow us to offset the dilution of our shares if the conversion feature of the convertible senior notes is exercised.

During the ~~six~~nine months ended ~~December~~March 31, ~~2006~~2007 and ~~2005,~~2006, we repurchased 13,462,430 shares of our common stock at an average cost of $24.06 per share and ~~16,455,774~~17,354,274 shares of our common stock at an average cost of $24.24 per share, respectively. We did not repurchase any stock during the three months ended March 31, 2007.

As of ~~January 31,~~April 30, 2007, we had repurchased $1,246.8 million of our common stock since April 2004 and we had remaining authorization to repurchase $300.0 million of our common stock.

We currently have one securitization transaction structured to meet the accounting criteria for a sale of finance receivables. Under this structure, notes issued by our unconsolidated qualified special purpose finance ~~subsidiaries~~subsidiary are not recorded as liabilities on our consolidated balance sheets. See Liquidity and Capital Resources – Securitizations for a detailed discussion of our securitization transactions.

Fluctuations in market interest rates impact our credit facilities and securitization transactions. Our gross interest rate spread, which is the difference between interest earned on our finance receivables and interest paid, is affected by changes in interest rates as a result of our dependence upon the issuance of variable rate securities and the incurrence of variable rate debt to fund our purchases of finance receivables.

Finance receivables purchased by us and pledged to secure borrowings under our credit facilities bear fixed interest rates. Amounts borrowed under our credit facilities bear interest at variable rates that are subject to frequent adjustments to reflect prevailing market interest rates. To protect the interest rate spread within each credit facility, our special purpose finance subsidiaries are contractually required to purchase interest rate cap agreements in connection with borrowings under our credit facilities. The purchaser of the interest rate cap agreement pays a premium in return for the right to receive the difference in the interest cost at any time a specified index of market interest rates rises above the stipulated “cap” rate. The purchaser of the interest rate cap agreement bears no obligation or liability if interest rates fall below the “cap” rate. As part of our interest rate risk management strategy and when economically feasible, we may simultaneously sell a corresponding interest rate cap agreement in order to offset the premium paid by our special purpose finance subsidiary to purchase the interest rate cap agreement and thus retain the interest rate risk. The fair value of the interest rate cap agreement purchased by the special purpose finance subsidiary is included in other assets and the fair value of the interest rate cap agreement sold by us is included in other liabilities on our consolidated balance sheets.

The interest rate demanded by investors in our securitization transactions depends on prevailing market interest rates for comparable transactions and the general interest rate environment. We utilize several strategies to minimize

the impact of interest rate fluctuations on our gross interest rate margin, including the use of derivative financial instruments, the regular sale or pledging of receivables to securitization Trusts, pre-funding of securitization transactions and the use of revolving structures.

In our securitization transactions, we transfer fixed rate finance receivables to Trusts that, in turn, sell either fixed rate or floating rate securities to investors. The fixed rates on securities issued by the Trusts are indexed to market interest rate swap spreads for transactions of similar duration or various London Interbank Offered Rates (“LIBOR”) and do not fluctuate during the term of the securitization. The floating rates on securities issued by the Trusts are indexed to LIBOR and fluctuate periodically based on movements in LIBOR. Derivative financial instruments, such as interest rate swap and cap agreements, are used to manage the gross interest rate spread on these transactions. We use interest rate swap agreements to convert the variable rate exposures on securities issued by our securitization Trusts to a fixed rate, thereby locking in the gross interest rate spread to be earned by us over the life of a securitization. Interest rate swap agreements purchased by us do not impact the amount of cash flows to be received by holders of the asset-backed securities issued by the Trusts. The interest rate swap agreements serve to offset the impact of increased or decreased interest paid by the Trusts on floating rate asset-backed securities on the cash flows to be received by us from the Trusts. We utilize such arrangements to modify our net interest sensitivity to levels deemed appropriate based on our risk tolerance. In circumstances where the interest rate risk is deemed to be tolerable, usually if the risk is less than one year in term at inception, we may choose not to hedge potential fluctuations in cash flows due to changes in interest rates. Our special purpose finance subsidiaries are contractually required to purchase interest rate cap agreements in connection with the issuance of floating rate securities even if we choose not to hedge our future cash flows. Although the interest rate cap agreements are purchased by the Trusts, cash outflows from the Trusts ultimately impact our retained interests in the securitization transactions as cash expended by the securitization Trusts will decrease the ultimate amount of cash to be received by us. Therefore, when economically feasible, we may simultaneously sell a corresponding interest rate cap agreement to offset the premium paid by the Trust to purchase the interest rate cap agreement. The fair value of the interest rate cap agreements purchased by the special purpose finance subsidiaries in connection with securitization transactions are included in other assets and the fair value of the interest rate cap agreements sold by us are included in other liabilities on our consolidated balance sheets. Changes in the fair value of the interest rate cap agreements sold by us are reflected in interest expense on our consolidated statements of income and comprehensive income.

Pre-funding securitizations is the practice of issuing more asset-backed securities than needed to cover finance receivables initially sold or pledged to the Trust. The proceeds from the pre-funded portion are held in an escrow account until additional receivables are delivered to the Trust in amounts up to the pre-funded balance held in the escrow account. The use of pre-funded securitizations allows us to lock in borrowing costs with respect to the

finance receivables subsequently delivered to the Trust. However, we incur an expense in pre-funded securitizations during the period between the initial delivery of finance receivables and the subsequent delivery of finance receivables equal to the difference between the interest earned on the proceeds held in the escrow account and the interest rate paid on the asset-backed securities outstanding.

Additionally, in May 2006, we issued a “revolving” securitization transaction that allows us to replace receivables as they amortize down rather than paying down the outstanding debt balance for a period of one year subject to compliance with certain covenants. The use of this type of transaction allows us to finance approximately 50% more receivables than in our typical amortizing securitization structure at that borrowing cost.

~~In January 2007, we~~We have entered into an interest rate swap ~~agreement~~agreements to hedge the variability in interest payments on a portion of our two most recent securitization ~~transaction. This~~transactions. These interest rate swap ~~agreement is~~agreements are designated and ~~qualifies~~qualify as a cash flow ~~hedge.~~hedges.

In February 2006, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standards (“SFAS”) No. 155, “Accounting for Certain Hybrid Financial Instruments” (“SFAS 155”). SFAS 155 amends SFAS 133, “Accounting for Derivative Instruments and Hedging Activities”, and SFAS 140, “Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities”. SFAS 155 (i) permits the fair value remeasurement for any hybrid financial instrument that contains an embedded derivative that otherwise would require bifurcation, (ii) clarifies which interest-only strips and principal-only strips are not subject to the requirement of SFAS 133, (iii) establishes a requirement to evaluate interests in securitized financial assets to identify interests that are freestanding derivatives or that are hybrid financial instruments that contain an embedded derivative requiring bifurcation, (iv) clarifies that concentrations of credit risk in the form of subordination are not embedded derivatives and (v) amends SFAS 140 to eliminate the prohibition on a qualifying special purpose entity from holding a derivative financial instrument that pertains to a beneficial interest other than another derivative financial instrument. SFAS 155 is effective for all financial instruments acquired or issued after the beginning of our fiscal year ending June 30, 2008. Management is currently evaluating the impact of the statement; however it is not expected to have a material impact on our consolidated financial position, results of operations or cash flows.

In July 2006, the FASB issued FASB Interpretation No. 48 (“FIN 48”), “Accounting for Uncertainty in Income Taxes – an interpretation of FASB Statement 109.” FIN 48 prescribes a comprehensive model for recognizing, measuring, presenting and disclosing in the financial statements tax positions taken or expected to be taken on a tax return, including a decision whether to file or not to file in a particular jurisdiction. FIN 48 is effective for our fiscal year ending June 30, 2008. Management is currently evaluating the impact of the adoption of FIN 48.

In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements” (“SFAS 157”), which defines fair value, establishes a framework for measuring fair value under GAAP and expands disclosures about fair value measurements. SFAS 157 requires companies to disclose the fair value of its financial instruments according to a fair value hierarchy. Additionally, companies are required to provide certain disclosures regarding instruments within the hierarchy, including a reconciliation of the beginning and ending balances for each major category of assets and liabilities. SFAS 157 applies to other accounting pronouncements that require or permit fair value measurements. SFAS 157 is effective for our fiscal year ending June 30, 2009. Management is currently evaluating the impact of the statement; however it is not expected to have a material impact on our consolidated financial position, results of operations or cash flows.

The preceding Management’s Discussion and Analysis of Financial Condition and Results of Operations section contains several “forward-looking statements.” Forward-looking statements are those that use words such as “believe,”

~~“expect,~~ “expect,” “anticipate,” “intend,” “plan,” “may,” “will,” “likely,” “should,” “estimate,” “continue,” “future” or other comparable expressions. These words indicate future events and trends. Forward-looking statements are our current views with respect to future events and financial performance. These forward-looking statements are subject to many assumptions, risks and uncertainties that could cause actual results to differ significantly from historical results or from those anticipated by us. The most significant risks are detailed from time to time in our filings and reports with the Securities and Exchange Commission including our Annual Report on Form 10-K for the year ended June 30, 2006. It is advisable not to place undue reliance on our forward-looking statements. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Because our funding strategy is dependent upon the issuance of interest-bearing securities and the incurrence of debt, fluctuations in interest rates impact our profitability. Therefore, we employ various hedging strategies to minimize the risk of interest rate fluctuations. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Interest Rate Risk” for additional information regarding such market risks.

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in the reports we file under the Securities and Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the Commission’s rules and forms. Such controls include those designed to ensure that information for disclosure is accumulated and communicated to management, including the Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), as appropriate to allow timely decisions regarding required disclosure.

The CEO and CFO, with the participation of management, have evaluated the effectiveness of our disclosure controls and procedures as of ~~December~~March 31, ~~2006.~~2007. Based on their evaluation, they have concluded, to the best of their knowledge and belief, that the disclosure controls and procedures are effective.

There were no changes made in our internal control over financial reporting during the three months ended ~~December~~March 31, ~~2006,~~2007, that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

Our management, including the CEO and CFO, recognize that the disclosure controls and internal controls (discussed above) cannot prevent all errors or all attempts at fraud. Any controls system, no matter how well crafted and operated, can only provide reasonable, and not absolute, assurance of achieving the desired control objectives, and management was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Because of the inherent limitations in any control system, no evaluation or implementation of a control system can provide complete assurance that all control issues and all possible instances of fraud have been or will be detected.

As a consumer finance company, we are subject to various consumer claims and litigation seeking damages and statutory penalties, based upon, among other things, usury, disclosure inaccuracies, wrongful repossession, violations of bankruptcy stay provisions, certificate of title disputes, fraud, breach of contract and discriminatory treatment of credit applicants. Some litigation against us could take the form of class action complaints by ~~consumers.~~consumers and/or shareholders. As the assignee of finance contracts originated by dealers, we may also be named as a co-defendant in lawsuits filed by consumers principally against dealers. The damages and penalties claimed by consumers in these types of matters can be substantial. The relief requested by the plaintiffs varies but can include requests for compensatory, statutory and punitive damages. We believe that we have taken prudent steps to address and mitigate the litigation risks associated with our business activities.

delinquency triggers in securitization transactions and enhance cash flows and to incorrectly report charge-offs and delinquency percentages, thereby causing us to misrepresent our financial performance. A special litigation committee (“SLC”) of the Board of Directors was created to investigate the claims in the derivative actions. In September 2005, the SLC completed its investigation of the claims made by the derivative plaintiffs in Rosenthal and Harris and

rendered its decision that continuation of the derivative proceeding is not in our best interests. Accordingly, we filed a Motion to Dismiss each derivative complaint. On August 21, 2006, the federal court entered an Order dismissing the Rosenthal case, with prejudice. The ~~plaintiff filed a notice~~judgment of ~~appeal within the time permitted but later withdrew its notice of appeal with the court’s consent. Accordingly, the Rosenthal case has been resolved in our favor.~~dismissal is now final. On January 3, 2007, the state court orally granted our motion to dismiss the Harris case, ~~although the~~and entered a written order ~~has~~dismissing the Harris case on February 26, 2007. The plaintiff in Harris did not ~~yet been entered. This~~appeal the order of dismissal and the matter is ~~subject to appeal by the plaintiff.~~now final.

In addition to the other information set forth in this report, the factors discussed in Part I, Item 1, “Risk Factors” in our Annual Report on Form 10-K for the year ended June 30, 2006, should be carefully considered as these risk factors could materially affect our business, financial condition or future results. The risks described in our Annual Report on Form 10-K are not the only risks facing us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially and adversely affect our business, financial condition and/or operating results.

During the three months ended ~~December~~March 31, ~~2006,~~2007, we had no share repurchases.

The matters voted upon by the shareholders and the details of the votes cast by the shareholders on those matters at the Annual Meeting of Shareholders held on October 25, 2006, were reported in our Quarterly Report on Form 10-Q for the quarter ended September 30, 2006, filed with the Commission on November 8, 2006.

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


		Page
Part I. FINANCIAL INFORMATION

Item 1.	CONDENSED FINANCIAL STATEMENTS	3

	Consolidated Balance Sheets – ~~December~~March 31, ~~2006~~2007 and June 30, 2006	3

	Consolidated Statements of Income and Comprehensive Income – Three and ~~Six~~Nine Months Ended ~~December~~March 31, ~~2006~~2007 and ~~2005~~2006	4

	Consolidated Statements of Cash Flows – ~~Six~~Nine Months Ended ~~December~~March 31, ~~2006~~2007 and ~~2005~~2006	5

	Notes to Consolidated Financial Statements	6

Item 2.	~~MANAGEMENT'S~~MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	30

Item 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	63

Item 4.	CONTROLS AND PROCEDURES	63

Part II. OTHER INFORMATION

Item 1.	LEGAL PROCEEDINGS	64

Item 1A.	RISK FACTORS	65

Item 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	65

Item 3.	DEFAULTS UPON SENIOR SECURITIES	65

Item 4.	SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS	65

Item 5.	OTHER INFORMATION	65

Item 6.	EXHIBITS	6566

SIGNATURE		6667


	Six Months Ended December 31,
	2006		2005
Interest costs (none capitalized)	$	303,385	$	236,680
Income taxes		98,068		116,971


	Nine Months Ended March 31,
		2007		2006
Interest costs (none capitalized)		$	481,962	$	279,273
Income taxes			121,319		132,250


	10% adverse change		20% adverse change
Impact on allowance for loan losses	$	69,154	$	138,308


	10% adverse change		20% adverse change
Impact on allowance for loan losses	$	75,646	$	151,292


	March 31, 2006
	Finance Receivables				Gain on Sale				Total Managed
	Amount		Percent		Amount		Percent		Amount		Percent
Delinquent contracts:
31 to 60 days	$	470,698	4.5	%	$	52,291	7.0	%	$	522,989	4.7	%
Greater than 60 days		156,220	1.5			25,087	3.3			181,307	1.6

		626,918	6.0			77,378	10.3			704,296	6.3
In repossession		31,189	0.3			4,596	0.6			35,785	0.3

	$	658,107	6.3	%	$	81,974	10.9	%	$	740,081	6.6	%


31.1		Officers’ Certifications of Periodic Report pursuant to Section 302 of Sarbanes-Oxley Act of 2002

32.1		Officers’ Certifications of Periodic Report pursuant to Section 906 of Sarbanes-Oxley Act of 2002


			AmeriCredit Corp.
		(Registrant)

Date: ~~February 8,~~May 9, 2007	By:	/s/ Chris A. Choate
		(Signature)
		Chris A. Choate
		Executive Vice President,
		Chief Financial Officer and Treasurer