Cover Page
Cover Page - shares | 3 Months Ended | |
Mar. 31, 2021 | Apr. 30, 2021 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-38506 | |
Entity Registrant Name | GreenSky, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 82-2135346 | |
Entity Address, Address Line One | 5565 Glenridge Connector | |
Entity Address, Address Line Two | Suite 700 | |
Entity Address, City or Town | Atlanta | |
Entity Address, State or Province | GA | |
Entity Address, Postal Zip Code | 30342 | |
City Area Code | (678) | |
Local Phone Number | 264-6105 | |
Title of 12(b) Security | Class A common stock, $0.01 par value | |
Trading Symbol | GSKY | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Current Fiscal Year End Date | --12-31 | |
Amendment Flag | false | |
Entity Central Index Key | 0001712923 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 | |
Class A common stock | ||
Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 78,373,099 | |
Class B common stock | ||
Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 106,059,097 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Assets | ||
Cash and cash equivalents | $ 196,298 | $ 147,775 |
Restricted cash | 300,414 | 319,879 |
Loan receivables held for sale, net | 342,943 | 571,415 |
Accounts receivable, net of allowance of $431 and $313, respectively | 18,489 | 21,958 |
Property, equipment and software, net | 21,826 | 21,452 |
Deferred tax assets, net | 386,116 | 387,951 |
Other assets | 88,333 | 52,643 |
Total assets | 1,354,419 | 1,523,073 |
Liabilities | ||
Accounts payable | 31,117 | 15,418 |
Accrued compensation and benefits | 10,299 | 13,666 |
Other accrued expenses | 12,115 | 5,207 |
Finance charge reversal liability | 167,436 | 185,134 |
Term loan | 452,269 | 452,806 |
Warehouse facility | 295,877 | 502,830 |
Tax receivable agreement liability | 310,624 | 310,425 |
Financial guarantee liability | 124,217 | 131,894 |
Other liabilities | 112,629 | 81,169 |
Total liabilities | 1,516,583 | 1,698,549 |
Commitments, Contingencies and Guarantees (Note 14) | ||
Equity (Deficit) | ||
Additional paid-in capital | 112,534 | 110,938 |
Retained earnings | 37,506 | 33,751 |
Treasury stock | (147,918) | (147,360) |
Accumulated other comprehensive income (loss) | (3,712) | (4,340) |
Noncontrolling interests | (161,614) | (169,484) |
Total equity (deficit) | (162,164) | (175,476) |
Total liabilities and equity (deficit) | 1,354,419 | 1,523,073 |
Warehouse SPV | Revolving credit facility | Warehouse Credit Agreement | ||
Liabilities | ||
Warehouse facility | 295,900 | |
Class A common stock | ||
Equity (Deficit) | ||
Permanent equity | 933 | 912 |
Class B common stock | ||
Equity (Deficit) | ||
Permanent equity | $ 107 | $ 107 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Allowance | $ 431 | $ 313 |
Class A common stock | ||
Common stock par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, issued (in shares) | 93,461,197 | 91,317,225 |
Common stock, outstanding (in shares) | 78,405,311 | 76,734,106 |
Class B common stock | ||
Common stock par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, issued (in shares) | 106,059,097 | 106,165,105 |
Common stock, outstanding (in shares) | 106,059,097 | 106,165,105 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Revenue | ||
Interest and other | $ 4,848 | $ 690 |
Total revenue | 125,172 | 121,857 |
Costs and expenses | ||
Cost of revenue (exclusive of depreciation and amortization shown separately below) | 63,997 | 72,305 |
Compensation and benefits | 22,473 | 22,164 |
Property, office and technology | 4,459 | 3,921 |
Depreciation and amortization | 3,316 | 2,445 |
Sales, general and administrative | 14,642 | 9,929 |
Related party | 452 | 477 |
Total costs and expenses | 105,456 | 129,649 |
Operating profit | 19,716 | (7,792) |
Other income (expense), net | ||
Interest and dividend income | 137 | 622 |
Interest expense | (6,614) | (5,620) |
Other gains (losses), net | 758 | 976 |
Total other income (expense), net | (5,719) | (4,022) |
Income (loss) before income tax expense (benefit) | 13,997 | (11,814) |
Income tax expense (benefit) | 1,872 | (895) |
Net income (loss) | 12,125 | (10,919) |
Less: Net income (loss) attributable to noncontrolling interests | 8,327 | (7,585) |
Net income (loss) attributable to GreenSky, Inc. | $ 3,798 | $ (3,334) |
Earnings per share of Class A common stock | ||
Basic (in dollars per share) | $ 0.05 | $ (0.05) |
Diluted (in dollars per share) | $ 0.05 | $ (0.05) |
Transaction fees | ||
Revenue | ||
Revenue | $ 85,657 | $ 89,884 |
Servicing | ||
Revenue | ||
Revenue | $ 34,667 | $ 31,283 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Statement of Comprehensive Income [Abstract] | ||
Net income (loss) | $ 12,125 | $ (10,919) |
Other comprehensive income (loss), net of tax | ||
Net unrealized gains (losses) on interest rate swap arising during the period | 543 | (11,824) |
Reclassification of interest rate swap settlements into interest expense (income) during the period | 1,323 | 98 |
Other comprehensive income (loss), net of tax | 1,866 | (11,726) |
Comprehensive income (loss) | 13,991 | (22,645) |
Less: Comprehensive income (loss) attributable to noncontrolling interests | 9,565 | (15,773) |
Comprehensive income (loss) attributable to GreenSky, Inc. | $ 4,426 | $ (6,872) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (DEFICIT) (Unaudited) - USD ($) $ in Thousands | Total | Cumulative effect of accounting change | [1] | Class A common stock | Class B common stock | Common stockClass A common stock | Common stockClass B common stock | Additional Paid-in Capital | Additional Paid-in CapitalClass A common stock | Additional Paid-in CapitalClass B common stock | Retained Earnings | Retained EarningsCumulative effect of accounting change | [1] | Treasury stock | Accumulated Other Comprehensive Income (Loss) | Noncontrolling Interest | Noncontrolling InterestCumulative effect of accounting change | [1] |
Beginning balance (in shares) at Dec. 31, 2019 | 66,424,838 | 113,517,198 | ||||||||||||||||
Beginning balance at Dec. 31, 2019 | $ (54,943) | $ (107,659) | $ 800 | $ 114 | $ 115,782 | $ 56,109 | $ (32,212) | $ (146,234) | $ (756) | $ (80,758) | $ (75,447) | |||||||
Increase (Decrease) in Stockholders' Equity | ||||||||||||||||||
Net income (loss) | (10,919) | (3,334) | (7,585) | |||||||||||||||
Class A common stock option exercises (in shares) | 105,000 | 15,051 | ||||||||||||||||
Class A common stock option exercises | $ (73) | $ (73) | ||||||||||||||||
Class B common stock exchanges (in shares) | 215,830 | 215,830 | ||||||||||||||||
Class B common stock exchanges | $ 0 | $ 2 | $ (2) | |||||||||||||||
Forfeited share-based compensation awards (in shares) | (181,794) | |||||||||||||||||
Shares issued, shares, net share settlement and other (in shares) | (107,043) | |||||||||||||||||
Shares withheld related to net share settlement and other | (654) | (654) | ||||||||||||||||
Distributions | (31,137) | (184) | (30,953) | |||||||||||||||
Share-based compensation | 3,495 | 3,495 | ||||||||||||||||
Equity-based payments to non-employees | 4 | 4 | ||||||||||||||||
Tax adjustments | 116 | 116 | ||||||||||||||||
Impact of noncontrolling interest on change in ownership during period | 0 | (3,229) | 3,229 | |||||||||||||||
Other comprehensive income (loss), net of tax | (11,726) | (3,538) | (8,188) | |||||||||||||||
Ending balance (in shares) at Mar. 31, 2020 | 66,366,882 | 113,301,368 | ||||||||||||||||
Ending balance at Mar. 31, 2020 | (213,496) | $ 802 | $ 114 | 116,093 | 20,379 | (146,888) | (4,294) | (199,702) | ||||||||||
Beginning balance (in shares) at Dec. 31, 2020 | 76,734,106 | 106,165,105 | 76,734,106 | 106,165,105 | ||||||||||||||
Beginning balance at Dec. 31, 2020 | (175,476) | $ 912 | $ 107 | 110,938 | 33,751 | (147,360) | (4,340) | (169,484) | ||||||||||
Increase (Decrease) in Stockholders' Equity | ||||||||||||||||||
Net income (loss) | 12,125 | 3,798 | 8,327 | |||||||||||||||
Issuance of unvested Class A common stock awards (in shares) | 2,019,240 | |||||||||||||||||
Issuance of unvested Class A common stock awards | 0 | $ 20 | (20) | |||||||||||||||
Class A common stock option exercises (in shares) | 104,833 | 18,724 | ||||||||||||||||
Class A common stock option exercises | $ (15) | $ (15) | ||||||||||||||||
Class B common stock exchanges (in shares) | 106,008 | 106,008 | ||||||||||||||||
Class B common stock exchanges | $ 0 | $ 1 | $ (1) | |||||||||||||||
Forfeited share-based compensation awards (in shares) | (380,786) | |||||||||||||||||
Shares issued, shares, net share settlement and other (in shares) | (91,981) | |||||||||||||||||
Shares withheld related to net share settlement and other | (558) | (558) | ||||||||||||||||
Distributions | (3,852) | (43) | (3,809) | |||||||||||||||
Share-based compensation | 3,707 | 3,707 | ||||||||||||||||
Equity-based payments to non-employees | 4 | 4 | ||||||||||||||||
Tax adjustments | 35 | 35 | ||||||||||||||||
Impact of noncontrolling interest on change in ownership during period | 0 | (2,114) | 2,114 | |||||||||||||||
Other comprehensive income (loss), net of tax | 1,866 | 628 | 1,238 | |||||||||||||||
Ending balance (in shares) at Mar. 31, 2021 | 78,405,311 | 106,059,097 | 78,405,311 | 106,059,097 | ||||||||||||||
Ending balance at Mar. 31, 2021 | $ (162,164) | $ 933 | $ 107 | $ 112,534 | $ 37,506 | $ (147,918) | $ (3,712) | $ (161,614) | ||||||||||
[1] | Represents the cumulative effect resulting from our adoption of the Financial Accounting Standards Board Accounting Standards Update 2016-13, Measurement of Credit Losses on Financial Instruments . See Note 1 to the Notes to Unaudited Condensed Consolidated Financial Statements for additional information on our implementation. |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Cash flows from operating activities | ||
Net income (loss) | $ 12,125 | $ (10,919) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Depreciation and amortization | 3,316 | 2,445 |
Share-based compensation expense | 3,707 | 3,495 |
Equity-based payments to non-employees | 4 | 4 |
Fair value change in servicing assets and liabilities | (7,505) | (2,306) |
Operating lease liability payments | (37) | (145) |
Financial guarantee expense (benefit) | (7,677) | 18,408 |
Amortization of debt related costs | 847 | 416 |
Original issuance discount on term loan payment | (18) | (10) |
Income tax expense (benefit) | 1,870 | (895) |
Impairment losses | 0 | 72 |
Mark to market on loan receivables held for sale | 3,466 | 0 |
Changes in assets and liabilities: | ||
(Increase) decrease in loan receivables held for sale | 225,006 | 30,867 |
(Increase) decrease in accounts receivable | 3,469 | 428 |
(Increase) decrease in other assets | (30,099) | 418 |
Increase (decrease) in accounts payable | 15,699 | 7,941 |
Increase (decrease) in finance charge reversal liability | (17,698) | 7,123 |
Increase (decrease) in guarantee liability | (3,794) | 0 |
Increase (decrease) in other liabilities | 42,454 | (16,295) |
Net cash provided by operating activities | 245,135 | 41,047 |
Cash flows from investing activities | ||
Purchases of property, equipment and software | (3,452) | (3,354) |
Net cash used in investing activities | (3,452) | (3,354) |
Cash flows from financing activities | ||
Repayments of term loan | (1,170) | (990) |
Proceeds from Warehouse facility | 31,917 | 0 |
Repayments of Warehouse facility | (238,870) | 0 |
Member distributions | (4,529) | (32,798) |
Proceeds from option exercises | 27 | 0 |
Payment of option exercise taxes | 0 | (73) |
Net cash used in financing activities | (212,625) | (33,861) |
Net increase (decrease) in cash and cash equivalents and restricted cash | 29,058 | 3,832 |
Cash and cash equivalents and restricted cash at beginning of period | 467,654 | 445,841 |
Cash and cash equivalents and restricted cash at end of period | 496,712 | 449,673 |
Supplemental non-cash investing and financing activities | ||
Distributions accrued but not paid | 1,995 | 4,317 |
Capitalized software costs accrued but not paid | 395 | 66 |
Tax withholding on equity awards accrued but not paid | $ 600 | $ 654 |
Organization, Summary of Signif
Organization, Summary of Significant Accounting Policies and New Accounting Standards | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, Summary of Significant Accounting Policies and New Accounting Standards | Organization, Summary of Significant Accounting Policies and New Accounting Standards Organization Unless the context requires otherwise, "we," "us," "our," "GreenSky" and "the Company" refer to GreenSky, Inc. and its subsidiaries. "Bank Partners" are the federally insured banks that originate loans under the consumer financing and payments program that we administer for use by merchants on behalf of such banks in connection with which we provide point-of-sale financing and payments technology and related marketing, servicing, collection and other services (the "GreenSky program" or "program"). We are a leading technology company Powering Commerce at the Point of Sale ® . Our platform is powered by a proprietary, patented technology infrastructure that facilitates merchant sales, while reducing the friction and improving the economics associated with a consumer making a purchase and a lender or financial institution extending financing for that purchase. It supports the full transaction lifecycle, including credit application, underwriting, real-time allocation to our Bank Partners, document distribution, funding, settlement and servicing. Merchants using our platform, which presently range from small, owner-operated home improvement contractors and healthcare providers to large national home improvement brands and retailers and healthcare service organizations, rely on us to facilitate low or deferred interest promotional point-of-sale financing and payments solutions that enable higher sales volume than they could otherwise achieve on their own. Consumers on our platform, who to date primarily have super-prime or prime credit scores, find financing with promotional terms to be an attractive alternative to other forms of payment. Our Bank Partners' access to our proprietary technology solution and merchant network enables them to build a diversified portfolio of high-quality consumer loans with attractive risk-adjusted yields with minimal upfront investment. GreenSky, Inc. was formed as a Delaware corporation on July 12, 2017. The Company was formed for the purpose of completing an initial public offering ("IPO") of its Class A common stock and certain Reorganization Transactions, as further described in the GreenSky, Inc. Form 10-K filed with the U.S. Securities and Exchange Commission ("SEC") on March 10, 2021 (the "2020 Form 10-K"), in order to carry on the business of GreenSky, LLC (“GSLLC”), a Georgia limited liability company. GSLLC is an operating entity and wholly-owned subsidiary of GS Holdings, LLC ("GS Holdings"). GS Holdings, a holding company with no operating assets or operations other than its equity interest in GSLLC, was organized to serve as a holding company for GSLLC. On August 24, 2017, GS Holdings acquired a 100% interest in GSLLC. The equity of GS Holdings is owned partially by GreenSky, Inc. and partially by certain pre-IPO equity owners of GS Holdings. Common membership interests of GS Holdings are referred to as "Holdco Units." On May 24, 2018, the Company's Class A common stock commenced trading on the Nasdaq Global Select Market in connection with its IPO. The IPO and Reorganization Transactions resulted in the Company becoming the sole managing member of GS Holdings. As the sole managing member of GS Holdings, we operate and control all of GS Holdings’ operations and, through GS Holdings and its subsidiaries, conduct GS Holdings’ business. The Company consolidates the financial results of GS Holdings and reports a noncontrolling interest in its Unaudited Condensed Consolidated Financial Statements representing the GS Holdings interests held by the Continuing LLC Members, as such term is defined in the 2020 Form 10-K. The weighted average ownership percentages for the applicable reporting periods are used to attribute net income (loss) and other comprehensive income (loss) to the Company and the noncontrolling interest. In 2020, we formed GS Depositor I, LLC (“Depositor”), an indirect subsidiary of the Company, and GS Investment I, LLC (the “Warehouse SPV”), a special purpose vehicle and indirect subsidiary of the Company, to facilitate purchases of participation interests in loans (“Warehouse Loan Participations") originated by Bank Partners through the GreenSky program. These purchases are made by Depositor and then transferred to the Warehouse SPV. Each of the Warehouse SPV and Depositor is a separate legal entity from the Company, and the assets of the Warehouse SPV and Depositor are solely available to satisfy the creditors of the Warehouse SPV or Depositor, respectively. Summary of Significant Accounting Policies Basis of Presentation The Unaudited Condensed Consolidated Financial Statements were prepared in accordance with the rules and regulations of the SEC for interim financial statements. We condensed or omitted certain notes and other information from the interim financial statements presented in this Quarterly Report on Form 10-Q. Therefore, these interim statements should be read in conjunction with the 2020 Form 10-K. In the opinion of management, the Unaudited Condensed Consolidated Financial Statements reflect all adjustments, which are of a normal recurring nature, necessary for a fair statement of our financial condition and results of operations for the interim periods presented. The condensed consolidated balance sheet as of December 31, 2020 was derived from the audited annual consolidated financial statements, but does not contain all of the footnote disclosures from the annual consolidated financial statements required by United States generally accepted accounting principles ("GAAP"). All intercompany balances and transactions are eliminated upon consolidation. The results for the three months ended March 31, 2021 are not necessarily indicative of results expected for the full year. Certain reclassifications have been made to the prior year presentation to conform to the current year presentation in the Unaudited Condensed Consolidated Statements of Operations. With the formation and use of the Warehouse SPV, we have reclassified the presentation of the following items associated with the loan receivables held for sale that were previously presented as "non-operating" within the Unaudited Condensed Consolidated Statements of Operations: valuation allowance (inclusive of both credit and market interest rate considerations) for loan receivables held for sale and interest income from loan receivables held for sale. The classification of such valuation allowance for the three months ended March 31, 2020 of $2.6 million was changed from other gains (losses), net to sales, general and administrative expense within the Unaudited Condensed Consolidated Statements of Operations to conform to the current period presentation. The classification of such interest income for the three months ended March 31, 2020 of $687 thousand was reclassified from interest and dividend income to interest and other revenue within the Unaudited Condensed Consolidated Statements of Operations to conform to the current period presentation. Use of Estimates The preparation of our financial statements in conformity with GAAP requires that management make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Such estimates and assumptions include, but are not limited to, those that relate to fair value measurements, financial guarantees, share-based compensation and income taxes. In developing estimates and assumptions, management uses all available information; however, actual results could materially differ from those estimates and assumptions. Cash and Cash Equivalents and Restricted Cash Cash and Cash Equivalents Cash includes non-interest and interest-bearing demand deposit accounts with various financial institutions. We consider all highly liquid investments that mature three months or less from the date of purchase to be cash equivalents. Cash equivalents include money market mutual fund accounts, which are invested in government securities that are either guaranteed by the Federal Deposit Insurance Corporation of the U.S. government ("FDIC") or are secured by U.S. government-issued collateral for which the risk of loss from nonpayment is presumed to be zero. As such, we do not establish an allowance for credit losses on our cash equivalents. Further, the carrying amounts of our cash equivalents approximate their fair values due to their short maturities and highly liquid nature. Refer to Note 3 for additional information on our fair value measurement. Restricted Cash Restricted cash includes cash held in interest-bearing escrow accounts to provide limited protection to our Bank Partners in the event of certain Bank Partner portfolio credit losses or in the event that the finance charges billed to borrowers do not exceed the sum of an agreed-upon portfolio yield, a fixed servicing fee and realized credit losses. Restricted cash also includes cash maintained for certain Bank Partners related to our finance charge reversal ("FCR") liability, certain custodial in-transit loan funding and consumer borrower payments that were restricted from use for our operations, and cash related to collections in connection with Warehouse Loan Participations. Refer to Note 14 for additional information. The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the Unaudited Condensed Consolidated Balance Sheets to the total included within the Unaudited Condensed Consolidated Statements of Cash Flows as of the dates indicated. March 31, 2021 2020 Cash and cash equivalents $ 196,298 $ 176,707 Restricted cash 300,414 272,966 Cash and cash equivalents and restricted cash in Unaudited Condensed Consolidated Statements of Cash Flows $ 496,712 $ 449,673 Accounts Receivable Accounts receivable are recorded at their original invoice amounts, which are reduced by any allowance for uncollectible amounts. We use the aging method to establish an allowance for expected credit losses on accounts receivable balances and consider whether current conditions or reasonable and supportable forecasts about future conditions warrant an adjustment to our historical loss experience. In applying such adjustments, we primarily consider changes in counterparty credit risk and changes in the underlying macroeconomic environment. Accounts receivable are written off once delinquency exceeds 90 days. Recoveries of previously written off accounts receivable are recognized on a collected basis as a reduction to the provision for credit losses, which is included within sales, general and administrative expense in the Unaudited Condensed Consolidated Statements of Operations. Refer to Note 5 for additional information on our accounts receivable. Fair Value of Assets and Liabilities We have financial assets and liabilities subject to fair value measurement or disclosure on either a recurring or nonrecurring basis. Such measurements or disclosures relate to our cash and cash equivalents, loan receivables held for sale, derivative instruments, servicing assets and liabilities, contingent consideration receivables, and term loan. ASC 820, Fair Value Measurement , defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In valuing this asset or liability, we utilize market data or reasonable assumptions that market participants would use, including assumptions about risk and the risks inherent in the inputs to the valuation technique. The guidance provides a three-level valuation hierarchy for disclosure of fair value measurements based on the transparency of inputs to the valuation of an asset or a liability as of the measurement date. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels are defined as follows: Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2: Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability. Level 3: Unobservable inputs for the asset or liability. An asset’s or a liability’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. We apply the market approach, which uses observable prices and other relevant information that is generated by market transactions involving identical or comparable assets or liabilities, to value our cash and cash equivalents and loan receivables held for sale. We apply the income approach, which uses valuation techniques to convert future amounts to a single, discounted present value amount, to value our FCR liability, contingent consideration receivables, and servicing assets and liabilities. We determine the fair values of our interest rate swap, interest rate cap, and term loan by applying a discounted cash flow model based on observable market factors and credit factors specific to us. Refer to Note 3 for additional fair value disclosures. Derivative Instruments We are exposed to interest rate risk on our variable-rate term loan, which we manage by entering into an interest rate swap that is determined to be a derivative in accordance with ASC 815, Derivatives and Hedging . Derivatives are recorded on the balance sheet at fair value and are marked-to-market on a quarterly basis. The accounting for the change in fair value of derivatives depends on the intended use of the derivative, whether the Company has elected to designate the derivative as a hedge and apply hedge accounting, and whether the hedging relationship continues to satisfy the criteria required to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to variability in cash flows of a recognized asset or liability that is attributable to a particular risk are considered cash flow hedges. The primary purpose of cash flow hedge accounting is to link the income statement recognition of a hedging instrument and a hedged item whose changes in cash flows are expected to offset each other. The change in the fair value of the derivative instrument designated as a cash flow hedge is initially reported as a component of other comprehensive income (loss) and subsequently reclassified into earnings in the same period when the hedged item affects earnings. The reclassification into earnings is reported in the same income statement line item in which the hedged item is reported. The FCR component of our Bank Partner contracts, which arrangements are detailed in Note 3, qualifies as an embedded derivative. The FCR liability is not designated as a hedge for accounting purposes and, as such, changes in its fair value are recorded within cost of revenue in the Unaudited Condensed Consolidated Statements of Operations. We have other embedded derivative instruments that are not designated as hedges. Refer to Note 3 and Note 8 for additional fair value and derivative disclosures. Financial Guarantees Under the terms of the contracts with our Bank Partners, we provide limited protection to the Bank Partners in the event of certain Bank Partner portfolio credit losses or in the event that the finance charges billed to borrowers do not exceed the sum of an agreed-upon portfolio yield, a fixed servicing fee and realized credit losses, by holding cash in restricted, interest-bearing escrow accounts in an amount equal to a contractual percentage of the Bank Partners’ monthly originations and month-end outstanding portfolio balance. Our maximum exposure under these financial guarantees is contractually limited to the escrow that we establish with each Bank Partner. Cash set aside to meet this requirement is classified as restricted cash in our Unaudited Condensed Consolidated Balance Sheets. Our contracts with our Bank Partners entitle us to incentive payments when the finance charges billed to borrowers exceed the sum of an agreed-upon portfolio yield, a fixed servicing fee and realized credit losses. This incentive payment varies from month to month, primarily due to the amount of realized credit losses. If credit losses exceed an agreed-upon threshold, we are obligated to make limited payments to our Bank Partners, which obligation represents a financial guarantee in accordance with ASC 460, Guarantees . Under ASC 460, the guarantor undertakes a noncontingent obligation to stand ready to perform over the term of the guarantee and a contingent obligation to make future payments if the triggering events or conditions under the guarantee arrangements occur. Under ASU 2016-13, we are required to estimate the expected credit losses over the contractual period in which we are exposed to credit risk via a present contractual obligation to extend credit, unless that obligation is unconditionally cancellable by the issuer. As applied to our financial guarantee arrangements, we are required to estimate expected credit losses, and the impact of those estimates on our potential escrow payments, for loans within our Bank Partner portfolios that are either funded or approved for funding at the measurement date, but are precluded from including future loan originations by our Bank Partners. Consistent with the modeling of loan losses for any consumer loan portfolio assumed to go into "run-off," our recognized financial guarantee liability under this model represents a significant portion of the contractual escrow established with each Bank Partner. Typically, additional financial guarantee liabilities are recorded as new Bank Partner loans are facilitated on our platform, along with a corresponding non-cash charge recorded as financial guarantee expense in the Unaudited Condensed Consolidated Statements of Operations. As the terms of our guarantee arrangements are determined contractually with each Bank Partner, we measure our contingent obligation separately for each Bank Partner using a discounted cash flow method based on estimates of the outstanding loan attributes of the Bank Partner's loan servicing portfolio and our expectations of forecasted information, including macroeconomic conditions, over the period which our financial guarantee is expected to be used in a "run-off" scenario. We use our historical experience as a basis for estimating escrow usage and adjust for current conditions or forecasts of future conditions if they are determined to vary from our historical experience. Refer to Note 14 for additional information on our financial guarantees. Revenue Recognition Disaggregated revenue Revenue disaggregated by type of service was as follows for the periods presented: Three Months Ended March 31, 2021 2020 Merchant fees $ 81,159 $ 81,415 Interchange fees 4,498 8,469 Transaction fees 85,657 89,884 Servicing (1) 34,667 31,283 Interest income (2) 4,847 687 Other (3) 1 3 Interest and other 4,848 690 Total revenue $ 125,172 $ 121,857 (1) For the three months ended March 31, 2021 and 2020, includes increases in the fair value of our servicing asset of $7.1 million and $1.8 million, respectively. Refer to Note 3 for additional information. (2) Includes interest income earned on loan receivables held for sale. (3) Other revenue includes miscellaneous revenue items that are individually immaterial. Other revenue is presented separately herein in order to clearly present merchant, interchange fees, servicing fees, and interest income which are more integral to our primary operations and better enable financial statement users to calculate metrics such as servicing and merchant fee yields. We have no remaining performance obligations as of March 31, 2021. No assets were recognized from the costs to obtain or fulfill a contract with a customer as of March 31, 2021 and December 31, 2020. Because we recognize revenue as invoiced, no contract assets or contract liabilities were recorded as of March 31, 2021 and December 31, 2020. V olume-based price concessions to merchants and Sponsors that were netted against the gross transaction price were $7.5 million and $5.0 million for the three months ended March 31, 2021 and 2020, respectively. "Sponsors" refers to manufacturers, their captive and franchised showroom operations, and trade associations with which we partner to onboard merchants. We recognized credit losses arising from our contracts with customers of $170 thousand and $177 thousand during the three months ended March 31, 2021 and 2020, respectively, which are recorded within sales, general and administrative expense in our Unaudited Condensed Consolidated Statements of Operations. Consolidation In the normal course of our business, we may enter into an agreement for management, servicing, or related services or hold ownership interests in special purpose entities. We evaluate our interests and/or involvement in these entities to determine whether they meet the definition of a variable interest entity ("VIE"), pursuant to ASC 810, Consolidation , and whether we are required to consolidate these entities. Recently Adopted Accounting Standards Simplifying the Accounting for Income Taxes In December 2019, the FASB issued ASU 2019-12, which modifies ASC 740, Income Taxes, to simplify the accounting for income taxes by removing certain exceptions, including intraperiod tax allocations and the calculation of income taxes in an interim period when in a loss position. Our adoption of this standard on January 1, 2021 did not have a material effect on our Unaudited Condensed Consolidated Financial Statements. Accounting Standards Issued, But Not Yet Adopted Facilitation of the Effects of Reference Rate Reform on Financial Reporting In March 2020, the FASB issued ASU 2020-04, which provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions that reference the London Interbank Offered Rate ("LIBOR") or another reference rate expected to be discontinued because of reference rate reform, if certain criteria are met. The standard applies to contract modifications that replace a reference rate affected by reference rate reform and contemporaneous modifications of other contract terms related to the replacement of the reference rate. Further, the standard provides exceptions to certain guidance in ASC 815, Derivatives and Hedging , related to changes to the critical terms of a hedging relationship due to reference rate reform and provides optional expedients for fair value, cash flow and net investment hedging relationships for which the component excluded from the assessment of hedge effectiveness is affected by reference rate reform. This standard is effective as of March 12, 2020, and an entity may elect to adopt it through December 31, 2022 based on applying as of the beginning of an interim period up to the date that the financial statements are available to be issued. Once elected, the provisions of the standard must be applied prospectively for all similar eligible contract modifications. We have not yet elected an adoption date, are currently identifying arrangements referenced to rates, such as US dollar LIBOR, that are expected to be discontinued, and are evaluating our options for modifying such arrangements in accordance with the standard. We will continue to assess and plan for how the phase out of LIBOR will affect the Company; however, while the LIBOR transition could adversely affect the Company, we do not expect the impact to be material to the Company. |
Earnings per Share
Earnings per Share | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Earnings per Share | Earnings per ShareBasic earnings per share of Class A common stock is computed by dividing net income attributable to GreenSky, Inc. by the weighted average number of shares of Class A common stock outstanding during the period. Diluted earnings per share of Class A common stock is computed by dividing net income attributable to GreenSky, Inc., adjusted for the assumed exchange of all potentially dilutive Holdco Units for Class A common stock, by the weighted average number of shares of Class A common stock outstanding adjusted to give effect to potentially dilutive elements. The following table sets forth reconciliations of the numerators and denominators used to compute basic and diluted earnings per share of Class A common stock for the periods indicated. Three Months Ended 2021 2020 Numerator: Income (loss) before income tax expense (benefit) $ 13,997 $ (11,814) Less: Net income (loss) attributable to noncontrolling interests 8,327 (7,585) Less: Income tax expense (benefit) 1,872 (895) Net income (loss) attributable to GreenSky, Inc. – basic $ 3,798 $ (3,334) Add: Reallocation of net income attributable to noncontrolling interests from the assumed exchange of Holdco Units for Class A common stock 8,327 — Less: Income tax expense on reallocation of net income attributable to noncontrolling interests (1) 2,755 — Net income (loss) attributable to GreenSky, Inc. – diluted $ 9,370 $ (3,334) Denominator: Weighted average shares of Class A common stock outstanding – basic 71,859,110 63,650,697 Add: Dilutive effects, as shown separately below Holdco Units exchangeable for Class A common stock 105,815,474 — Class A common stock options 116,401 — Unvested Class A common stock 1,741,441 — Weighted average shares of Class A common stock outstanding – diluted 179,532,426 63,650,697 Earnings (loss) per share of Class A common stock outstanding – basic $ 0.05 $ (0.05) Earnings (loss) per share of Class A common stock outstanding – diluted $ 0.05 $ (0.05) Excluded from diluted earnings per share, as their inclusion would have been anti-dilutive (2) Holdco Units 241,439 113,301,368 Class A common stock options 2,065,517 3,859,794 Class A common stock awards 2,888,542 2,405,122 (1) We assumed effective tax rates of 33.1% and 21.2% for the three months ended March 31, 2021 and 2020, respectively, which represents the effective tax rates on the consolidated GreenSky, Inc. entity inclusive of the income taxes on the portion of GS Holdings' earnings that are attributable to noncontrolling interests. (2) These amounts represent the number of instruments outstanding at the end of the period. Application of the treasury stock method would reduce these amounts if they had a dilutive effect and were included in the computation of diluted earnings per share. Shares of the Company’s Class B common stock do not participate in the earnings or losses of the Company and, therefore, are not participating securities. As such, separate presentation of basic and diluted earnings per share of Class B common stock under the two-class method has not been included. |
Fair Value of Assets and Liabil
Fair Value of Assets and Liabilities | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Assets and Liabilities | Fair Value of Assets and LiabilitiesThe following table summarizes, by level within the fair value hierarchy, the carrying amounts and estimated fair values of our assets and liabilities measured at fair value on a recurring or nonrecurring basis or disclosed, but not carried, at fair value in the Unaudited Condensed Consolidated Balance Sheets as of the dates presented. There were no transfers into, out of, or between levels within the fair value hierarchy during any of the periods presented. Refer to Note 4, Note 7, Note 8 and Note 9 for additional information on these assets and liabilities. Level March 31, 2021 December 31, 2020 Carrying Fair Carrying Fair Assets: Cash and cash equivalents (1) 1 $ 196,298 $ 196,298 $ 147,775 $ 147,775 Loan receivables held for sale, net (2) 2 342,943 345,720 571,415 575,279 Servicing assets (3) 3 37,944 37,944 30,804 30,804 Contingent consideration receivables (3) 3 1,811 1,811 — — Interest rate cap (3) 2 251 251 — — Liabilities: Finance charge reversal liability (3) 3 $ 167,436 $ 167,436 $ 185,134 $ 185,134 Term loan (1) 2 452,269 450,798 452,806 452,408 Interest rate swap (3) 2 12,116 12,116 14,182 14,182 Servicing liabilities (3) 3 1,619 1,619 1,984 1,984 Sales facilitation obligations (3) 2 19,264 19,264 10,655 10,655 (1) Disclosed, but not carried, at fair value. (2) Measured at fair value on a recurring basis. (3) Measured and carried at fair value on a recurring basis. Cash and cash equivalents Cash and cash equivalents are classified within Level 1 of the fair value hierarchy, as the primary component of the price is obtained from quoted market prices in an active market. The carrying amounts of our cash and cash equivalents approximate their fair values due to the short maturities and highly liquid nature of these accounts. Loan receivables held for sale, net Loan receivables held for sale are recorded in the Unaudited Condensed Consolidated Balance Sheets at the lower of cost or fair value and, therefore, are measured at fair value on a nonrecurring basis. Our loan receivables held for sale are primarily loan participations owned by the Warehouse SPV and the majority of these loan participations is expected to be sold at or around par to third party purchasers. Fair value of our loan receivables held for sale is determined based on the anticipated sale price of such participations to third parties. Loan receivables held for sale are classified within Level 2 of the fair value hierarchy, as the primary component of the price is obtained from observable values of loan receivables with similar terms and characteristics. Servicing assets and liabilities We previously elected the fair value method to account for our servicing assets and liabilities to more appropriately reflect the value of the servicing rights in our Unaudited Condensed Consolidated Financial Statements. As a result of this election, our servicing assets and liabilities are carried at fair value on a recurring basis within other assets and other liabilities, respectively, in the Unaudited Condensed Consolidated Balance Sheets and are estimated using a discounted cash flow model. Servicing assets and liabilities are classified within Level 3 of the fair value hierarchy, as the primary components of the fair value are obtained from unobservable inputs based on peer market data, reasonably adjusted for assumptions that would be used by market participants to service our Bank Partner loans and transferred charged-off receivables portfolios, for which market data is not available. Changes in the fair value of our servicing assets are recorded within servicing revenue and changes in the fair value of our servicing liabilities are recorded within other gains (losses), net in the Unaudited Condensed Consolidated Statements of Operations. Contractually specified servicing fees recorded within servicing revenue in the Unaudited Condensed Consolidated Statements of Operations totaled $27.5 million and $29.5 million for the three months ended March 31, 2021 and 2020, respectively. The cash flow impacts of our assets and liabilities that are measured at fair value on a recurring basis are included within net cash provided by operating activities in the Unaudited Condensed Consolidated Statements of Cash Flows. The following table reconciles the beginning and ending fair value measurements of our servicing assets associated with Bank Partner loans during the periods presented. Three Months Ended March 31, 2021 2020 Beginning balance $ 30,804 $ 30,459 Additions, net (1) 11,347 2,098 Changes in fair value (4,207) (309) Ending balance $ 37,944 $ 32,248 (1) Includes additions through assumptions of servicing obligations each time a loan is originated on our platform by a Bank Partner, as well as through transfers of loan receivables between Bank Partners or of loan receivables between GreenSky and Bank Partners and is net of the impact of loan principal pay downs in the Bank Partner portfolios. Additions are recognized in servicing revenue in the Unaudited Condensed Consolidated Statements of Operations. The following table reconciles the beginning and ending fair value measurements of our servicing liabilities associated with transferring our rights to charged-off receivables during the periods presented. Three Months Ended March 31, 2021 2020 Beginning balance $ 1,984 $ 3,796 Changes in fair value (1) (365) (517) Ending balance $ 1,619 $ 3,279 (1) Represents the reduction of our servicing liabilities due to the passage of time and collection of loan payments and recognized in other gains (losses), net in the Unaudited Condensed Consolidated Statements of Operations. Significant assumptions used in valuing our servicing assets and liabilities include the following: Cost of servicing: The cost of servicing represents the servicing rate a willing market participant would require to service loans with similar characteristics as the Bank Partner loans or charged-off receivables. The cost of servicing is weighted based on the outstanding balance of the loans. Discount rate: The discount rate reflects the time value of money adjusted for a risk premium and is within an observable range based on peer market data. Weighted average remaining life: For Bank Partner loans, the weighted average remaining life is determined using the aggregate curves for each loan product type based on expected cumulative annualized rates of prepayments and defaults. Recovery period: For charged-off receivables, our recovery period is determined based on a reasonable recovery period for loans of these sizes and characteristics based on historical experience. We assume that collection efforts for these loans will cease after five years, and the run-off of the portfolio will follow a straight-line methodology, adjusted for actual cash recoveries over time. The following table presents quantitative information about the significant unobservable inputs used to value the Level 3 servicing assets and liabilities as of the dates presented. Input March 31, 2021 December 31, 2020 Range Weighted Average Range Weighted Average Cost of servicing (basis points) 62.5 – 100.0 86.0 57.5 – 108.0 95.0 Discount rate 18.0 % 18.0% 18.0 % 18.0% Weighted average remaining life (years) 2.6 – 5.8 2.6 2.3 – 5.8 2.3 Recovery period (years) 1.3 - 3.7 2.9 1.6 – 3.9 3.1 A significant increase or decrease in the market cost of servicing could have resulted in significantly lower or higher, respectively, servicing assets and higher or lower, respectively, servicing liabilities as of the measurement date. A significant increase or decrease in the discount rate could have resulted in lower or higher, respectively, servicing assets and liabilities as of the measurement date. However, as the weighted average remaining life of loans is relatively short, we would not expect significant changes in the discount rate to materially impact the fair value measure. The average remaining life is weighted by the unpaid balance of the Bank Partner loans as of the measurement date. A significant increase or decrease in the expected weighted average remaining life could have resulted in significantly higher or lower servicing assets as of the measurement date. The recovery period is weighted by the unpaid balance of previously transferred charged-off receivables as of the measurement date. A significant increase or decrease in the expected recovery period could have resulted in higher or lower, respectively, servicing liabilities. Contingent consideration receivables In exchange for selling loan participations to institutional investors, financial institutions and other financing sources, the Company receives cash, and, in some cases, additional contingent consideration, which may be received at a later date based on certain potential outcomes (typically based on the performance of the assets sold or the underlying loans). The contingent consideration receivable serves as a host contract containing an embedded derivative as the credit and prepayment performance of the loan participations are tied to the underlying debtor, rather than the third party purchaser of the loan participations, which results in the economic characteristics and risks being not clearly and closely related to the host contract. In accordance with ASC 825, GreenSky irrevocably elects to initially and subsequently measure the contingent consideration receivables as a whole, inclusive of the embedded credit derivative, at fair value. This election is made on an instrument by instrument basis, and our election only affects the contingent consideration receivables and does not apply to, nor implicate, other receivables. The contingent consideration receivables are classified within Level 3 of the fair value hierarchy, as the primary component of the fair value is obtained from unobservable inputs based on the Company’s data, reasonably adjusted for assumptions that would be used by market participants. Changes in the fair value of the contingent consideration receivables are recorded within cost of revenue in the Unaudited Condensed Consolidated Statements of Operations. Significant assumptions used in valuing our contingent consideration receivables include a discount rate, delinquency rates, and prepayment rates. The following table reconciles the beginning and ending fair value measurements of our contingent consideration receivables during the period presented. Three Months Ended 2021 Beginning balance $ — Additions (1) 1,811 Receipts (2) — Other fair value changes (3) — Ending balance $ 1,811 (1) Includes each initial receivable that GreenSky is entitled to each time an applicable pool of loan participations is sold to institutional investors, financial institutions and other financing sources. (2) Represents cash receipt of contingent consideration. (3) Represents changes to the fair value of the contingent consideration receivables due to the passage of time, changes in the portfolio delinquency rate or prepayment rate. Interest rate cap In January 2021, the Warehouse SPV entered into a $555.0 million notional amortizing interest rate cap with a strike rate of 2.5%. This cap is intended to protect against exposure to changes in cash flows attributable to interest rate risk on $555.0 million of our variable-rate Warehouse Facility to the extent three-month LIBOR exceeds 2.5%. The interest rate cap is carried at fair value on a recurring basis in the Unaudited Condensed Consolidated Balance Sheets and is classified within Level 2 of the fair value hierarchy, as the inputs to the derivative pricing model are generally observable and do not contain a high level of subjectivity. The fair value was determined based on the present value of the estimated future net cash flows using implied rates in the applicable yield curve as of the valuation date. Finance charge reversal liability Our Bank Partners offer certain loan products that have a feature whereby the borrower is provided a promotional period to repay the loan principal balance in full without incurring a finance charge. For certain of these loan products, our Bank Partners bill interest each month throughout the promotional period and such amounts are included in the determination of the incentive payments paid by our Bank Partners to us. However, under the terms of the contracts with our Bank Partners, we are obligated to pay an amount equal to this billed interest to the Bank Partners if a borrower repays the loan balance in full within the promotional period and such interest is reversed. Therefore, the monthly process of billing interest on deferred loan products triggers a potential future FCR liability for the Company. The FCR component of our Bank Partner contracts qualifies as an embedded derivative. The FCR liability is not designated as a hedge for accounting purposes and, as such, changes in its fair value are recorded within cost of revenue in the Unaudited Condensed Consolidated Statements of Operations. The FCR liability is carried at fair value on a recurring basis in the Unaudited Condensed Consolidated Balance Sheets and is estimated based on historical experience and management’s expectation of future FCR. The FCR liability is classified within Level 3 of the fair value hierarchy, as the primary component of the fair value is obtained from unobservable inputs based on the Company’s data, reasonably adjusted for assumptions that would be used by market participants. The following table reconciles the beginning and ending fair value measurements of our FCR liability during the periods indicated. Three Months Ended March 31, 2021 2020 Beginning balance $ 185,134 $ 206,035 Receipts (1) 51,266 44,708 Settlements (2) (95,381) (90,089) Fair value changes recognized in cost of revenue (3) 26,417 52,504 Ending balance $ 167,436 $ 213,158 (1) Includes: (i) incentive payments from Bank Partners, which is the surplus of finance charges billed to borrowers over an agreed-upon portfolio yield, a fixed servicing fee and realized net credit losses and (ii) cash received from recoveries on previously charged-off Bank Partner loans. We consider all monthly incentive payments from Bank Partners during the period to be related to billed finance charges on deferred interest products until monthly incentive payments exceed total billed finance charges on deferred products, which did not occur during the periods presented. (2) Represents the reversal of previously billed finance charges associated with deferred payment loan principal balances that were repaid within the promotional period. The three months ended March 31, 2021 also includes $2.6 million of billed finance charges related to loan participations held by the Warehouse SPV that were not yet collected and subject to a potential future finance charge reversal at the time of purchase, which were paid to the Bank Partner in full as of the participation purchase dates. (3) A fair value adjustment is made based on the expected reversal percentage of billed finance charges (expected settlements), which is estimated at each reporting date. The fair value adjustment is recognized in cost of revenue in the Unaudited Condensed Consolidated Statements of Operations. Significant assumptions used in valuing our FCR liability include the following: Reversal rate : The reversal rate represents our estimate of the percentage of previously billed interest on deferred loan products that we expect we will be obligated to remit to the Bank Partners due to the borrower paying off the loan balance in full within the promotional period. The historical period over which we evaluate reversal rates may also vary among the categories of deferred loan products based on the length and relevance of our historical experience with such products at the measurement date. Discount rate : The discount rate reflects the time value of money adjusted for a risk premium. The following table presents quantitative information about the significant unobservable inputs used to value the Level 3 FCR liability as of the dates presented. March 31, 2021 December 31, 2020 Range Weighted Average Range Weighted Average Reversal rate 64.8% – 100.0% 89.9 % 64.8 – 100.0% 89.2 % Discount rate 3.5 % 3.5 % 3.5 % 3.5 % A significant increase or decrease in the estimated reversal rates could result in a significantly higher or lower, respectively, calculation of our expected future payments to our Bank Partners, resulting in a higher or lower, respectively, fair value measurement of our FCR liability. A significant increase or decrease in the discount rate could result in a lower or higher, respectively, fair value measurement of our FCR liability. Term loan The carrying value of our term loan is net of unamortized debt discount and debt issuance costs. The fair value of our term loan is classified within Level 2 of the fair value hierarchy, as the primary component of the price is obtained from quoted market prices for similar liabilities in an active market. Interest rate swap In June 2019, we entered into a $350.0 million notional, four-year interest rate swap agreement to hedge changes in our cash flows attributable to interest rate risk on $350.0 million of our variable-rate term loan to a fixed- rate basis, thus reducing the impact of interest rate changes on future interest expense. This swap involves the receipt of variable-rate amounts in exchange for fixed interest rate payments over the life of the agreement without an exchange of the underlying notional amount and was designated for accounting purposes as a cash flow hedge. The interest rate swap is carried at fair value on a recurring basis in the Unaudited Condensed Consolidated Balance Sheets and is classified within Level 2 of the fair value hierarchy, as the inputs to the derivative pricing model are generally observable and do not contain a high level of subjectivity. The fair value was determined based on the present value of the estimated future net cash flows using implied rates in the applicable yield curve as of the valuation date. Sales facilitation obligations In May 2020, the Company entered into a series of agreements (collectively, the “Facility Bank Partner Agreements”) with an existing Bank Partner to provide for the programmatic sale of loan participations and whole loans by that Bank Partner to third parties. Under the Facility Bank Partner Agreements, purchasers issue purchase commitments to the Bank Partner. The Company has certain sales facilitation obligations related thereto that qualify as embedded derivatives and are not designated as hedges for accounting purposes. As such, these sales facilitation obligations are recorded at fair value and changes in their respective fair value are recorded within cost of revenue in the Unaudited Condensed Consolidated Statements of Operations. First, the Company agreed under the Facility Bank Partner Agreements to facilitate sales by the Bank Partner of loan participations and whole loans to third parties (including sales to the Company or its affiliates, including the Warehouse SPV) by funding into an escrow account, established by the Company for the Bank Partner, the shortfall (if any) in purchase price commitment below par (“purchase price discount”) at the time a purchase commitment is made. The Bank Partner agreed that it will fund into the escrow account any purchase price in excess of par (“purchase price premium”) received in connection with a sale. Any purchase price discount will net settle with any contemporaneous purchase price premiums upon sale of the loan participations or whole loans, with a net discount being settled by a release of escrow funds to the Bank Partner at sale and a net premium being settled by a release of excess escrow funds (above minimum escrow requirements), if any, to the Company shortly following any such sale. Second, the Company may, from time to time, directly issue to the Bank Partner commitments to purchase loan participations at par under the Facility Bank Partner Agreements. The fair value of the resulting sales facilitation obligations is based on the difference between par and the anticipated sale prices of such participations to third parties, including institutional investors, financial institutions and other capital markets investors. As such, the fair value is classified within Level 2 of the fair value hierarchy, as the primary component of the price is obtained from observable values of loan receivables with similar terms and characteristics. At March 31, 2021 and December 31, 2020, the Company had sales facilitation obligations for which the fair value of the liability was $19.3 million and $10.7 million, respectively. The change in fair value for the three months ended March 31, 2021 was $8.6 million and is reflected in cost of revenue in the Unaudited Condensed Consolidated Statements of Operations. As the first sales facilitation obligations were entered into in the third quarter of 2020, there were no such amounts recorded for the three months ended March 31, 2020. |
Loan Receivables Held for Sale
Loan Receivables Held for Sale | 3 Months Ended |
Mar. 31, 2021 | |
Receivables [Abstract] | |
Loan Receivables Held for Sale | Loan Receivables Held for Sale The following table summarizes the activity in the balance of loan receivables held for sale, net at lower of cost or fair value during the periods indicated. Three Months Ended March 31, 2021 2020 Beginning balance $ 571,415 $ 51,926 Additions (1) 225,209 1,071 Proceeds from sales and borrower payments (2) (446,416) (29,035) Loss on sale (3,371) — Decrease (increase) in valuation allowance (3) (2,244) 288 Transfers (4) 872 56 Write-offs and other (5) (2,522) (3,247) Ending balance $ 342,943 $ 21,059 (1) Includes purchase of $209.5 million participations in loans through the Warehouse SPV, which was established in mid-2020. (2) We retain servicing arrangements on sold loan receivables with comparable terms and conditions as loans that are not participated by our Bank Partners. Additions also include accrued interest and fees and recoveries of previously charged-off loan receivables held for sale. Income from loan receivables held for sale activities is recorded within interest and other revenue in the Unaudited Condensed Consolidated Statements of Operations. (3) During the three months ended March 31, 2021, the valuation allowance increased by $3.5 million due to the change in the lower of cost or fair value adjustment on our Warehouse Loan Participations, partially offset by a decrease in our provision for credit losses of $1.1 million and the lower of cost or fair value adjustment on all other loan receivables held for sale of $135 thousand. During the three months ended March 31, 2020, the valuation allowance decreased for the change in the provision for credit losses. (4) We temporarily hold certain loan receivables, which are originated by a Bank Partner, while non-originating Bank Partner eligibility is being determined. Once we determine that a loan receivable meets the investment requirements of an eligible Bank Partner, we transfer the loan receivable to the Bank Partner at cost plus any accrued interest. The reported amount also includes loan receivables that have been placed on non-accrual and non-payment status while we investigate consumer inquiries. (5) We received recovery payments of $137 thousand and $55 thousand during the three months ended March 31, 2021 and 2020, respectively. Recoveries of principal and finance charges and fees on previously written off loan receivables held for sale are recognized on a collected basis and the cash proceeds received are recorded within sales, general and administrative expense in the Unaudited Condensed Consolidated Statements of Operations. Accounts receivable consisted of the following as of the dates indicated. Accounts Allowance for Accounts March 31, 2021 Transaction related $ 8,150 $ (431) $ 7,719 Servicing related 10,770 — 10,770 Total $ 18,920 $ (431) $ 18,489 December 31, 2020 Transaction related $ 10,533 $ (313) $ 10,220 Servicing related 11,738 — 11,738 Total $ 22,271 $ (313) $ 21,958 The following table summarizes the activity in the balance of allowance for uncollectible amounts during the period from January 1, 2021 through March 31, 2021. Allowance for Beginning balance $ (313) Provision for expected losses (170) Write-offs 52 Recoveries — Ending balance $ (431) |
Accounts Receivable
Accounts Receivable | 3 Months Ended |
Mar. 31, 2021 | |
Receivables [Abstract] | |
Accounts Receivable | Loan Receivables Held for Sale The following table summarizes the activity in the balance of loan receivables held for sale, net at lower of cost or fair value during the periods indicated. Three Months Ended March 31, 2021 2020 Beginning balance $ 571,415 $ 51,926 Additions (1) 225,209 1,071 Proceeds from sales and borrower payments (2) (446,416) (29,035) Loss on sale (3,371) — Decrease (increase) in valuation allowance (3) (2,244) 288 Transfers (4) 872 56 Write-offs and other (5) (2,522) (3,247) Ending balance $ 342,943 $ 21,059 (1) Includes purchase of $209.5 million participations in loans through the Warehouse SPV, which was established in mid-2020. (2) We retain servicing arrangements on sold loan receivables with comparable terms and conditions as loans that are not participated by our Bank Partners. Additions also include accrued interest and fees and recoveries of previously charged-off loan receivables held for sale. Income from loan receivables held for sale activities is recorded within interest and other revenue in the Unaudited Condensed Consolidated Statements of Operations. (3) During the three months ended March 31, 2021, the valuation allowance increased by $3.5 million due to the change in the lower of cost or fair value adjustment on our Warehouse Loan Participations, partially offset by a decrease in our provision for credit losses of $1.1 million and the lower of cost or fair value adjustment on all other loan receivables held for sale of $135 thousand. During the three months ended March 31, 2020, the valuation allowance decreased for the change in the provision for credit losses. (4) We temporarily hold certain loan receivables, which are originated by a Bank Partner, while non-originating Bank Partner eligibility is being determined. Once we determine that a loan receivable meets the investment requirements of an eligible Bank Partner, we transfer the loan receivable to the Bank Partner at cost plus any accrued interest. The reported amount also includes loan receivables that have been placed on non-accrual and non-payment status while we investigate consumer inquiries. (5) We received recovery payments of $137 thousand and $55 thousand during the three months ended March 31, 2021 and 2020, respectively. Recoveries of principal and finance charges and fees on previously written off loan receivables held for sale are recognized on a collected basis and the cash proceeds received are recorded within sales, general and administrative expense in the Unaudited Condensed Consolidated Statements of Operations. Accounts receivable consisted of the following as of the dates indicated. Accounts Allowance for Accounts March 31, 2021 Transaction related $ 8,150 $ (431) $ 7,719 Servicing related 10,770 — 10,770 Total $ 18,920 $ (431) $ 18,489 December 31, 2020 Transaction related $ 10,533 $ (313) $ 10,220 Servicing related 11,738 — 11,738 Total $ 22,271 $ (313) $ 21,958 The following table summarizes the activity in the balance of allowance for uncollectible amounts during the period from January 1, 2021 through March 31, 2021. Allowance for Beginning balance $ (313) Provision for expected losses (170) Write-offs 52 Recoveries — Ending balance $ (431) |
Property, Equipment and Softwar
Property, Equipment and Software | 3 Months Ended |
Mar. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property, Equipment and Software | Property, Equipment and Software Property, equipment and software were as follows as of the dates indicated. March 31, 2021 December 31, 2020 Furniture $ 1,592 $ 2,680 Leasehold improvements 3,604 4,399 Computer hardware 2,522 2,690 Software 33,864 30,641 Total property, equipment and software, at cost 41,582 40,410 Less: accumulated depreciation (5,092) (6,580) Less: accumulated amortization (14,664) (12,378) Total property, equipment and software, net $ 21,826 $ 21,452 |
Borrowings
Borrowings | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Borrowings | Borrowings Credit Agreement In August 2017, we entered into a $450.0 million credit agreement ("Credit Agreement"), which provided for a $350.0 million term loan ("original term loan") maturing on August 25, 2024 and a $100.0 million revolving loan facility maturing on August 25, 2022. 2018 Amended Credit Agreement In March 2018, we amended certain terms of our Credit Agreement ("2018 Amended Credit Agreement"). The 2018 Amended Credit Agreement replaced the original term loan with a $400.0 million term loan (“modified term loan”) and extended the maturity date to March 29, 2025. Revolving loan facility. Under the 2018 Amended Credit Agreement, the maturity date of the $100.0 million revolving loan facility was extended to March 29, 2023. Further, the interest margin applied to revolving loans that incur interest at a base rate was modified to 2.00% per annum and the margin applied to revolving loans that incur interest at an adjusted LIBOR rate was modified to 3.00% per annum. However, if our first lien net leverage ratio is equal to or above 1.50 to 1.00, these interest margins are raised to 2.25% and 3.25%, respectively. As of March 31, 2021 and December 31, 2020, we had no borrowings under the revolving loan facility. Lastly, the 2018 Amended Credit Agreement provided for a $10.0 million letter of credit, which, to the extent drawn upon, would reduce the amount of availability under the revolving loan facility by the same amount. We had nothing drawn under our available letter of credit as of March 31, 2021. We are subject to a quarterly commitment fee based on the daily unused amount of the revolving loan facility, inclusive of the aggregate amount available to be drawn under letters of credit, of which $10.0 million was available, but unused, as of March 31, 2021. The quarterly commitment fee rate is 0.50% per annum when our first lien net leverage ratio is above 1.50 to 1.00, but is reduced to 0.375% for any quarterly period in which our first lien net leverage ratio is equal to or below 1.50 to 1.00. For the three months ended March 31, 2021 and 2020, we recognized $125 thousand and $106 thousand, respectively, of commitment fees within interest expense in the Unaudited Condensed Consolidated Statements of Operations. 2020 Amended Credit Agreement In June 2020, we entered into a second amendment to our Credit Agreement ("2020 Amended Credit Agreement"), which provided for an additional $75.0 million term loan ("incremental term loan"). The term loan and revolving loan facility under the 2018 Amended Credit Agreement and incremental term loan under the 2020 Amended Credit Agreement are collectively referred to as the "Credit Facility," and the 2018 Amended Credit Agreement and the 2020 Amended Credit Agreement are collectively referred to as the "Amended Credit Agreement." The modified term loan and the incremental term loan are collectively referred to as the "term loan." The incremental term loan incurs interest, due monthly in arrears, at an adjusted LIBOR rate, which represents the one-month LIBOR rate multiplied by the statutory reserve rate, as defined in the 2020 Amended Credit Agreement, with a 1% LIBOR floor, plus 450 basis points. The incremental term loan has the same security, maturity, principal amortization, prepayment, and covenant terms as the 2018 Amended Credit Agreement, maturing on March 29, 2025. An original issuance discount of $3.0 million was reported as a direct deduction from the face amount of the incremental term loan. Fees paid to the lender of $1.5 million were deferred as debt issuance costs over the remaining life of the term loan on the modification date. Therefore, the initial gross proceeds of the incremental term loan were $70.5 million. The proceeds from the incremental term loan were used to pay third party costs, including legal fees, which were immediately expensed on the modification date. The remaining proceeds were used for general corporate purposes and to enhance the Company's overall liquidity position. Key details of the term loan are as follows: March 31, 2021 December 31, 2020 Term loan, face value (1) $ 462,438 $ 463,625 Unamortized debt discount (2) (4,843) (5,153) Unamortized debt issuance costs (2) (5,325) (5,666) Term loan $ 452,270 $ 452,806 (1) The principal balance of the term loan is scheduled to be repaid on a quarterly basis at an amortization rate of 0.25% per quarter through December 31, 2024, with the balance due at maturity. (2) For the three months ended March 31, 2021 and 2020, debt discount of $310 thousand and $153 thousand, respectively, and debt issuance costs of $341 thousand and $263 thousand, respectively, were amortized into interest expense in the Unaudited Condensed Consolidated Statements of Operations. Covenants. The Amended Credit Agreement contains certain financial and non-financial covenants with which we must comply. The financial covenant requires a first lien net leverage ratio equal to or below 3.50 to 1.00 for any measurement date at which the principal amounts of outstanding revolving loans and letters of credit exceed 25% of the aggregate principal amount of the revolving loan facility. The non-financial covenants include, among other things, restrictions on indebtedness, liens and fundamental changes to the business (such as acquisitions, mergers, liquidations or changes in the nature of the business, asset dispositions, restricted payments, transactions with affiliates and other customary matters). The Amended Credit Agreement also includes various negative covenants, including one that restricts GS Holdings from making non-tax distributions unless certain financial tests are met. We were in compliance with all covenants, both financial and non-financial, as of March 31, 2021 and December 31, 2020. Any borrowings under the Amended Credit Agreement are unconditionally guaranteed by certain of our subsidiaries. Further, the lenders have a security interest in certain assets of GS Holdings and the other guarantors thereunder. Interest Rate Swap In June 2019, we entered into an interest rate swap agreement to hedge changes in cash flows attributable to interest rate risk on $350.0 million of our variable-rate term loan. This interest rate swap was designated for accounting purposes as a cash flow hedge. See Note 8 for additional derivative disclosures. Warehouse Facility In May 2020, the Warehouse SPV entered into a warehouse credit agreement with JPMorgan Chase Bank, N.A. ("JPMorgan"), as administrative agent, and the lenders party thereto from time to time ("Warehouse Facility Lenders") to establish an asset-backed revolving credit facility to finance purchases by the Warehouse SPV of participation interests in loans originated through the GreenSky program (the "Warehouse Facility"). The Warehouse Facility initially provided a revolving committed financing of $300.0 million, with an additional $200.0 million uncommitted accordion that was accessed in July 2020. The interest rate on the Class A loans under the Warehouse Facility is the applicable commercial paper conduit funding rate (or, if the Warehouse Facility Lenders do not fund their advances under the Warehouse Facility through commercial paper markets, 3-month LIBOR plus 0.50%) plus 2.50%. On the three month anniversary of the closing date, the Company became subject to a fee based on a percentage of the total financing commitment that remains unused. The revolving funding period is one year and the initial maturity date was May 10, 2022. Upon obtaining the financing commitment, the Warehouse SPV was required to pay JPMorgan an upfront, nonrefundable fee ("upfront fees") equal to 0.15% of loan commitments. The Warehouse SPV paid various other legal and banking fees associated with obtaining the financing in conjunction with the closing of the Warehouse Facility in May 2020, including upfront fees of approximately $1.0 million which are deferred over the life of the Warehouse Facility. Amended Warehouse Facility On December 18, 2020, the Warehouse Facility was amended (the "Amended Warehouse Facility") to increase the amount of the Warehouse Facility’s revolving commitment from $300.0 million to $555.0 million, including $500.0 million under the Class A commitment and $55.0 million under the Class B commitment. The Amended Warehouse Facility established terms for the Class B commitment (including the advance rate for the Class B loans and an interest rate on the Class B loans under the Warehouse Facility equal to a fixed spread over one-month LIBOR), and extended the commitment termination date to December 17, 2021 and the maturity date to December 17, 2023. The Amended Warehouse Facility also established the fee for unused Class B commitments. The Warehouse SPV paid various other legal and banking fees in December 2020 associated with the Amended Warehouse Facility, including upfront fees, of approximately $1.6 million which were deferred over the remaining life of the Amended Warehouse Facility. The Warehouse Facility and the Amended Warehouse Facility are collectively referred to as the "Warehouse Facility." As of March 31, 2021, the outstanding balance on the Warehouse Facility was $295.9 million. The Warehouse Facility is secured by the loan participations held by the Warehouse SPV, and Warehouse Facility Lenders do not have direct recourse to the Company for any loans made under the Warehouse Facility. During the three months ended March 31, 2021, we amortized $196 thousand of related legal, banking and upfront fees into cost of revenue in the Unaudited Condensed Consolidated Statements of Operations. |
Derivative Instruments
Derivative Instruments | 3 Months Ended |
Mar. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments | Derivative Instruments The Company does not hold or use derivative instruments for trading purposes. Derivative Instruments Designated as Hedges Interest rate fluctuations expose our variable-rate term loan to changes in interest expense and cash flows. As part of our risk management strategy, we may use interest rate derivatives, such as interest rate swaps, to manage our exposure to interest rate movements. In June 2019, we entered into a $350.0 million notional, four-year interest rate swap agreement to hedge changes in cash flows attributable to interest rate risk on $350.0 million of our variable-rate term loan, which matures on March 29, 2025. This agreement involves the receipt of variable-rate amounts in exchange for fixed interest rate payments over the life of the agreement without an exchange of the underlying notional amount. This interest rate swap was designated for accounting purposes as a cash flow hedge. As such, changes in the interest rate swap’s fair value are deferred in accumulated other comprehensive income (loss) in the Unaudited Condensed Consolidated Balance Sheets and are subsequently reclassified into interest expense in each period that a hedged interest payment is made on our variable-rate term loan. As of March 31, 2021, we had the following outstanding interest rate derivatives that were designated as cash flow hedges of interest rate risk. Notional Amount Fixed Interest Rate Termination Date Interest rate swap $ 350,000 1.80% June 30, 2023 Derivative Instruments Not Designated as Hedges The FCR component of our Bank Partner contracts qualifies as an embedded derivative. The FCR liability is not designated as a hedge for accounting purposes and, as such, changes in its fair value are recorded within cost of revenue in the Unaudited Condensed Consolidated Statements of Operations. See Note 3 for additional information on finance charge reversals. As part of the Facility Bank Partner Agreements, the Company has certain sales facilitation obligations that qualify as embedded derivatives and are not designated as hedges for accounting purposes. As such, changes in their fair value are recorded within cost of revenue in the Unaudited Condensed Consolidated Statements of Operations. See Note 3 for additional information on sales facilitation obligations. In January 2021, as required under the Warehouse Facility, the Warehouse SPV entered into a $555.0 million notional amortizing interest rate cap agreement to protect against changes in cash flows attributable to interest rate risk on the variable-rate Warehouse Facility to the extent three-month LIBOR exceeds 2.5%. The interest rate cap has a maturity date of December 18, 2023. An upfront premium was paid for this interest rate cap agreement and the Company elected not to apply hedge accounting to the interest rate cap; therefore, changes in its fair value are recorded within cost of revenue in the Unaudited Condensed Consolidated Statements of Operations. See Note 3 for additional information on the interest rate cap. Derivative Instruments on our Unaudited Condensed Consolidated Financial Statements The following table presents the fair values and Unaudited Condensed Consolidated Balance Sheets locations of our derivative instruments as of the dates indicated. Balance Sheet Location March 31, 2021 December 31, 2020 Designated as cash flow hedges Interest rate swap Other liabilities $ 12,116 $ 14,182 Not designated as hedges FCR liability Finance charge reversal liability $ 167,436 $ 185,134 Sales facilitation obligations Other liabilities 19,264 10,655 Interest rate cap Other assets 251 — The following table presents the impacts of our derivative instruments on our Unaudited Condensed Consolidated Statements of Operations for the periods indicated. Three Months Ended March 31, 2021 2020 Designated as cash flow hedges Interest rate swap – gain (loss) reclassified into interest expense $ (1,468) $ (107) Interest rate swap – gain (loss) reclassified into income tax expense 145 9 Not designated as hedges FCR liability – change in fair value recorded in cost of revenue $ 26,417 $ 52,504 Sales facilitation obligations - change in fair value recorded in cost of revenue 8,609 — Interest rate cap - change in fair value recorded in cost of revenue 251 — Our derivative instrument activities are included within operating cash flows in our Unaudited Condensed Consolidated Statements of Cash Flows. Accumulated Other Comprehensive Income (Loss) The following table summarizes the changes in the components of accumulated other comprehensive income (loss) associated with our cash flow hedge, which exclude amounts pertaining to noncontrolling interests, for the period presented. Three Months Ended March 31, 2021 2020 Cash Flow Hedge Accumulated other comprehensive income (loss), beginning balance $ (4,340) $ (756) Other comprehensive income (loss) before reclassifications and tax 234 (4,706) Tax (expense) benefit (54) 1,139 Other comprehensive income (loss) before reclassifications, net of tax 180 (3,567) Reclassifications out of accumulated other comprehensive income (loss), net of tax (1) 448 29 Net (increase) decrease in other comprehensive loss 628 (3,538) Accumulated other comprehensive income (loss), ending balance $ (3,712) $ (4,294) (1) Net of tax benefit (expense) of $145 thousand and $9 thousand during the three months ended March 31, 2021 and 2020, respectively. Based on the current interest rate environment, the Company estimates that approximately $5.8 million of net unrealized losses reported in accumulated other comprehensive income (loss) will be reclassified into earnings within the next twelve months. |
Other Assets and Liabilities
Other Assets and Liabilities | 3 Months Ended |
Mar. 31, 2021 | |
Other Liabilities Disclosure [Abstract] | |
Other Assets and Liabilities | Other Assets and Liabilities The following table details the components of other assets in the Unaudited Condensed Consolidated Balance Sheets as of the dates indicated. March 31, 2021 December 31, 2020 Servicing assets (1) $ 37,944 $ 30,804 Right-of-use assets (2) 7,375 8,265 Prepaid expenses (3) 6,015 8,860 Related party receivables 84 88 Insurance recoveries (4) 26,900 — Other receivables and assets 10,015 4,626 Other assets $ 88,333 $ 52,643 (1) We elected the fair value method to account for our servicing assets. Refer to Note 3 for additional information. (2) Right-of-use ("ROU") assets represent our right to use an underlying asset for the lease term. Refer to Note 14 for additional information on our ROU assets. (3) Includes $1.1 million of implementation costs related to a new cloud computing arrangement which is categorized as a hosting arrangement that is a service contract under ASU 2018-15. Amortization for the period ended March 31, 2021 is $50 thousand and accumulated amortization as of March 31, 2021 is $59 thousand. (4) Insurance recoveries related to legal proceedings. Refer to Note 14 for additional information. The following table details the components of other liabilities in the Unaudited Condensed Consolidated Balance Sheets as of the dates indicated. March 31, 2021 December 31, 2020 Transaction processing liabilities $ 31,594 $ 30,169 Servicing liabilities (1) 1,619 1,984 Distributions payable 1,995 3,136 Interest rate swap (2) 12,116 14,182 Tax related liabilities (3) 667 691 Deferred lease liabilities 9,039 10,107 Legal settlement accrual (4) 27,500 — Accruals and other liabilities 8,835 10,245 Sales facilitation obligations (5) 19,264 10,655 Other liabilities $ 112,629 $ 81,169 (1) We elected the fair value method to account for our servicing liabilities. Refer to Note 3 for additional information. (2) Refer to Note 3 and Note 8 for additional information on our interest rate swap, which was in a liability position as of March 31, 2021 and December 31, 2020. (3) Tax related liabilities primarily include certain taxes payable related to the Reorganization Transactions. (4) Refer to Note 14 for additional information on our legal proceedings. (5) Changes in the fair value of the embedded derivative for loan participation commitments are recognized as a mark-to-market in cost of revenue for the period. |
Noncontrolling Interests
Noncontrolling Interests | 3 Months Ended |
Mar. 31, 2021 | |
Noncontrolling Interest [Abstract] | |
Noncontrolling Interests | Noncontrolling InterestsGreenSky, Inc. is the sole managing member of GS Holdings and consolidates the financial results of GS Holdings. Therefore, the Company reports a noncontrolling interest based on the common units of GS Holdings, held by the Continuing LLC Members. Changes in GreenSky, Inc.’s ownership interest in GS Holdings, while GreenSky, Inc. retains its controlling interest in GS Holdings, are accounted for as equity transactions. As such, future redemptions or direct exchanges of Holdco Units by the Continuing LLC Members (with automatic cancellation of an equal number of shares of Class B common stock) for shares of our Class A common stock on a one-for-one basis will result in a change in ownership and reduce or increase the amount recorded as noncontrolling interest and increase or decrease additional paid-in capital. The Company consolidates the financial results of GS Holdings and reports a noncontrolling interest in its Unaudited Condensed Consolidated Financial Statements representing the GS Holdings interests held by Continuing LLC Members. The weighted average ownership percentages for the applicable reporting periods are used to attribute net income (loss) and other comprehensive income (loss) to the Company and the noncontrolling interests. During the three months ended March 31, 2021 and 2020, GreenSky, Inc. had a weighted average ownership interest in GS Holdings of 40.5% and 36.2%, respectively. During the three months ended March 31, 2021, an aggregate of 0.1 million Holdco Units were exchanged by the Continuing LLC Members (with automatic cancellation of Class B common stock) for 0.1 million newly-issued shares of Class A common stock, and 2.0 million shares of Class A restricted stock were issued, which increased our total ownership interest in GS Holdings to 42.5% as of March 31, 2021 from 42.0% as of December 31, 2020. |
Stockholders Equity (Deficit)
Stockholders Equity (Deficit) | 3 Months Ended |
Mar. 31, 2021 | |
Equity [Abstract] | |
Stockholders Equity (Deficit) | Stockholders Equity (Deficit) Treasury Stock As of March 31, 2021, there were 15,055,886 shares of Class A common stock held in treasury, including: (i) purchases of 13,425,688 shares at a cost of $146.1 million, (ii) 1,300,764 shares associated with forfeited restricted stock awards, and (iii) 329,434 shares associated with tax withholdings upon vesting of restricted stock awards. There were no reissuances of treasury shares during the three months ended March 31, 2021and 2020. Distributions The following table summarizes activity associated with our non-tax and tax distributions during the periods indicated. Three Months Ended Remaining Reserved Payment (1) (in thousands) 2021 2020 Non-tax distributions previously declared and paid upon vesting Credit Agreement Distributions (2) Distributions $ 769 $ 1,129 $ 1,295 Special Operating Distributions (3) Distributions 372 533 700 Tax distributions 3,388 31,136 N/A Total $ 4,529 $ 32,798 $ 1,995 (1) As of March 31, 2021, all remaining portions of the non-tax distributions were recorded within other liabilities in the Unaudited Condensed Consolidated Balance Sheets. (2) See Note 7 for discussion of distributions using the proceeds from our borrowings. (3) In May 2018, we declared a special operating distribution of $26.2 million and, in December 2017, we declared a $160.0 million special cash distribution to Holdco Unit holders and holders of profits interests. |
Share-Based Compensation
Share-Based Compensation | 3 Months Ended |
Mar. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Share-Based Compensation | Share-Based CompensationThe Company has the following types of share-based compensation awards outstanding as of March 31, 2021: Class A common stock options, unvested Holdco Units and unvested Class A common stock awards. We recorded share-based compensation expense for the three months ended March 31, 2021 and 2020 of $3.7 million and $3.5 million, respectively, of which $3.3 million and $3.2 million are included within compensation and benefits expense and $387 thousand and $270 thousand are included within cost of revenue in the Unaudited Condensed Consolidated Statements of Operations. Class A Common Stock Options Class A common stock option ("Options") activity was as follows during the periods indicated: Three Months Ended Three Months Ended Number of Weighted Number of Outstanding at beginning of period 3,862,926 $ 9.70 4,181,909 Granted — — — Exercised (1)(2) (104,833) 5.65 (105,000) Forfeited (437,698) 7.85 (201,615) Expired (3) (217,476) 12.23 (15,500) Outstanding at end of period (4) 3,102,919 $ 9.93 3,859,794 Exercisable at end of period (4)(5) 1,351,989 $ 11.10 1,543,292 (1) The total intrinsic value of Options exercised, which is defined as the amount by which the market value of the stock on the date of exercise exceeds the exercise price, during the three months ended March 31, 2021 and 2020 was $145 thousand and $205 thousand, respectively. (2) During the three months ended March 31, 2021, employees paid $27 thousand to the Company to exercise Options which resulted in the issuance of 4,833 shares of Class A common stock. In addition, during this period, Options exercisable for 100,000 shares of Class A common stock were exercised by means of a cashless net exercise procedure, which resulted in the issuance of 13,891 shares of Class A common stock and for which the Company withheld taxes of $42 thousand. During the three months ended March 31, 2020, Options exercisable for 105,000 shares of Class A common stock were exercised by means of a cashless net exercise procedure, which resulted in the issuance of 15,051 shares of Class A common stock and for which the Company withheld taxes of $73 thousand. (3) Expired Options represent vested, underwater Options that were not exercised by terminated employees as stipulated in the Option award agreements, generally within 30 days from the employment termination date. (4) The aggregate intrinsic value and weighted average remaining contractual terms of Options outstanding and Options exercisable were as follows as of the date indicated: March 31, 2021 Aggregate intrinsic value (in thousands) Options outstanding $ 2,264 Options exercisable $ 229 Weighted average remaining term (in years) Options outstanding 7.4 Options exercisable 6.3 (5) The total fair value, based on grant date fair value, of Options that vested during the three months ended March 31, 2021 and 2020 was $1.2 million and $1.5 million, respectively. Unvested Holdco Units As part of the Reorganization Transactions and IPO, certain profits interests in GS Holdings were converted to vested and unvested Holdco Units based on the prevailing profits interests thresholds and the IPO price. The converted Holdco Units remain subject to the same service vesting requirements as the original profits interests and are not subject to post-vesting restrictions. Unvested Holdco Units activity was as follows during the periods indicated: Three Months Ended Three Months Ended Number of Weighted Average Grant Date Number of Unvested at beginning of period 489,486 $ 23.00 1,112,607 Forfeited — 23.00 — Vested (1) (93,800) 23.00 (134,582) Unvested at end of period 395,686 $ 23.00 978,025 (1) The total fair value, based on grant date fair value, of previously unvested Holdco Units that vested during the three months ended March 31, 2021 and 2020 was $2.2 million and $3.1 million, respectively. Restricted Stock Awards As part of the Reorganization Transactions and IPO, certain outstanding profits interests in GS Holdings were converted into vested and unvested Class A common stock awards based on the prevailing profits interests thresholds and the IPO price. The converted unvested Class A common stock awards remain subject to the same service vesting requirements as the original profits interests and are not subject to post-vesting restrictions. Subsequent to the Reorganization Transactions and IPO, we granted restricted stock awards in the form of unvested Class A common stock to certain employees that vest ratably over three or four years based on continued employment at the Company and to certain non-employee directors that vest one year from grant date based on continued service on the Board of Directors ("Board"). For these awards, compensation expense is measured based on the closing stock price of the Company's Class A common stock on the date of grant, and the total value of the awards is expensed ratably over the requisite service period. Unvested Class A common stock activity was as follows during the periods indicated: Three Months Ended Three Months Ended Class A Weighted Average Grant Date Class A Unvested at beginning of period 4,956,922 $ 6.53 2,999,343 Granted 2,019,240 6.77 — Forfeited (1) (380,786) 6.81 (181,794) Vested (2) (302,493) 13.19 (412,427) Unvested at end of period 6,292,883 $ 6.27 2,405,122 (1) Forfeited shares of unvested Class A common stock associated with restricted stock awards are held in our treasury stock account. Refer to Note 11 for additional information on our treasury stock. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes GreenSky, Inc. is taxed as a corporation and pays corporate federal, state and local taxes on income allocated to it from GS Holdings based upon GreenSky, Inc.’s economic interest held in GS Holdings. GS Holdings is treated as a pass-through partnership for income tax reporting purposes and not subject to federal income tax. Accordingly, the Company is not liable for income taxes on the portion of GS Holdings' earnings not allocated to it. The Company’s effective tax rate for the three months ended March 31, 2021 was 13.4% and the Company recorded $1.9 million of income tax expense for the three months ended March 31, 2021. The Company’s effective tax rate for the three months ended March 31, 2021 was less than our combined federal and state statutory tax rate of 24.4%, primarily because the Company is not liable for income taxes on the portion of GS Holdings’ earnings that are attributable to noncontrolling interests. The effective tax rate for the three months ended March 31, 2021 includes a stock-based compensation shortfall primarily related to restricted stock awards vesting, which is required to be recorded discretely in the interim period in which it occurs, and tax effects of a nondeductible regulatory matter which was recorded discretely during this period. The effective tax rate is dependent on many factors, including the estimated amount of income subject to income tax; therefore, the effective tax rate can vary from period to period. The Company's effective tax rate for the three months ended March 31, 2020 was 7.6% and the Company recorded $895 thousand of income tax benefit for the three months ended March 31, 2020. The Company's effective tax rate for the three months ended March 31, 2020 was less than our combined federal and state statutory tax rate of 24.3%, primarily because the Company is not liable for income taxes on the portion of GS Holdings’ earnings that are attributable to noncontrolling interests. The effective tax rate for the three months ended March 31, 2020 included a stock-based compensation shortfall primarily related to restricted stock awards vesting, which is required to be recorded discretely in the interim period in which it occurs. As of March 31, 2021 and December 31, 2020, the total liability related to uncertain tax positions was $98 thousand and $98 thousand, respectively. The Company recognizes interest and penalties, if applicable, related to uncertain tax positions as a component of income tax expense. Accrued interest and penalties were immaterial as of March 31, 2021, and therefore did not impact the effective income tax rate. Deferred tax assets, net of $386.1 million and $388.0 million as of March 31, 2021 and December 31, 2020, respectively, relate primarily to the basis difference in our investment in GS Holdings. This basis difference arose primarily as a result of the Reorganization Transactions, the IPO and subsequent exchanges of Class B common stock for Class A common stock. As of March 31, 2021, we concluded based on the weight of all available positive and negative evidence that all of our deferred tax assets are more likely than not to be realized. As such, no additional valuation allowance was recognized. Tax Receivable Agreement Pursuant to our election under Section 754 of the Internal Revenue Code (the "Code"), we expect to obtain an increase in our share of the tax basis in the net assets of GS Holdings when Holdco Units are redeemed or exchanged by the Continuing LLC Members of GS Holdings. We intend to treat any redemptions and exchanges of Holdco Units as direct purchases of Holdco Units for United States federal income tax purposes. These increases in tax basis may reduce the amounts that we would otherwise pay in the future to various tax authorities. They may also decrease gains (or increase losses) on future dispositions of certain capital assets to the extent tax basis is allocated to those capital assets. On May 23, 2018, we entered into a tax receivable agreement ("TRA") that provides for the payment by us of 85% of the amount of any tax benefits that we actually realize, or in some cases are deemed to realize, as a result of (i) increases in our share of the tax basis in the net assets of GS Holdings resulting from any redemptions or exchanges of Holdco Units and from our acquisition of the equity of certain of the Former Corporate Investors, (ii) tax basis increases attributable to payments made under the TRA, and (iii) deductions attributable to imputed |
Commitments, Contingencies and
Commitments, Contingencies and Guarantees | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments, Contingencies and Guarantees | Commitments, Contingencies and Guarantees Commitment Leases In accordance with ASC 842, Leases , we determine if an arrangement is or contains a lease at inception of the contract. A contract is or contains a lease if the contract conveys the right to control the use of identified property, plant or equipment for a period of time in exchange for consideration. We primarily lease our premises under multi-year, non-cancelable operating leases. Operating leases are included in other assets other liabilities ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at lease commencement date based on the present value of lease payments over the lease term. Operating lease cost associated with our ROU assets and lease liabilities was $1.0 million and $1.0 million for the three months ended March 31, 2021 and 2020, respectively. See Note 15 for additional information regarding office space leased from a related party. Our operating leases have terms expiring from 2021 through 2024, exclusive of renewal option periods. Our leases contain renewal option periods ranging from five As of March 31, 2021, we did not have any operating leases that had not yet commenced. Supplemental balance sheet information related to our operating leases was as follows as of the dates indicated. March 31, 2021 December 31, 2020 Operating lease ROU assets $ 7,375 $ 8,265 Operating lease liabilities $ 9,039 $ 10,107 Weighted average remaining lease term (in years) 2.2 2.4 Weighted average discount rate 5.8% 5.8% The following table provides a reconciliation of the total undiscounted cash flows related to our future lease obligations recorded in other liabilities in the Unaudited Condensed Consolidated Balance Sheets in accordance with ASC 842: March 31, 2021 Remainder of 2021 $ 3,688 2022 3,706 2023 1,501 2024 810 2025 — Thereafter — Total lease payments $ 9,705 Less: imputed interest (666) Operating lease liabilities $ 9,039 Covenants Our transaction processor and some Bank Partners impose financial covenants upon our wholly-owned subsidiary, GSLLC. As of March 31, 2021 and December 31, 2020, GSLLC was in compliance with the financial covenant provisions in these agreements. In addition, the agreements entered into as part of our loan participation sales with institutional investors and financial institutions impose financial covenants upon the Company. As of March 31, 2021, the Company was in compliance with the financial covenant provisions in these agreements. See Note 7 for discussion of financial and non-financial covenants associated with our borrowings. Other Commitments As of March 31, 2021 and December 31, 2020, the outstanding open and unused line of credit on approved loan receivables held for sale was $29.5 million and $99.9 million, respectively. We did not record a provision for these unfunded commitments, but believe we have adequate cash on hand to fund these commitments. For certain Bank Partners, we maintain a restricted cash balance based on a contractual percentage of the total interest billed on outstanding deferred interest loans that are within their respective promotional periods less previous FCR on such outstanding loans. As of March 31, 2021 and December 31, 2020, restricted cash in the Unaudited Condensed Consolidated Balance Sheets included $74.5 million and $84.6 million, respectively, associated with these arrangements. Contingencies In limited instances, the Company may be subject to operating losses if we make certain errors in managing credit programs and we determine that a customer is not liable for a loan originated by a Bank Partner. We evaluated this contingency in accordance with ASC 450, Contingencies , and determined that it is reasonably possible that losses could result from errors in underwriting. However, in management’s opinion, it is not possible to estimate the likelihood or range of reasonably possible future losses related to errors in underwriting based on currently available information. Therefore, we have not established a liability for this loss contingency. Further, from time to time, we place Bank Partner loans on non-accrual and non-payment status (“Pended Status”) while we investigate consumer loan balance inquiries, which may arise from disputed charges related to work performed by third-party merchants. As of March 31, 2021, Bank Partner loan balances in Pended Status were $11.6 million. While it is management’s expectation that most of these loan balance inquiries will be resolved without incident, in certain instances we may determine that it is appropriate for the Company to permanently reverse the loan balance and assume the economic responsibility for any such loan balance. We record a liability for these instances. As of March 31, 2021, our liability for potential Pended Status future losses was $4.1 million. Legal Proceedings IPO Litigation. The Company, together with certain of its officers and directors and one of its former directors and certain underwriters of the Company’s IPO, were named in a putative class action that was filed in the Supreme Court of the State of New York (In Re: GreenSky, Inc. Securities Litigation (Consolidated Action), Index No. 655626/2018 (N.Y. Sup. Ct.) (the “State Case”)), and are also named in a putative class action currently pending in the United States District Court for the Southern District of New York (the "District Court") (In Re: GreenSky, Inc. Securities Litigation (Consolidated Action), Case No. 1:2018-cv-11071-AKH (S.D.N.Y.) (the “Federal Case”)). The plaintiffs in the Federal Case generally allege (and the plaintiffs in the State Case generally alleged) that the offering documents in the IPO contained certain misstatements and omissions under Sections 11, 12(a)(2) and 15 of the Securities Act of 1933. The defendants deny the allegations in the Federal Case and believe they are without merit. The District Court has certified a class of certain purchasers of securities in the IPO. The parties in the Federal Case have entered into a binding Memorandum of Understanding to settle the matter. The District Court has ordered that the settlement documents be filed no later than May 24, 2021, and has set a status conference for June 11, 2021. The proposed settlement is subject to notice and approval by the District Court. Substantially all amounts payable by the Company under the proposed settlement will be paid by the Company’s insurers. The payable under the proposed settlement and the related insurance proceeds are recorded in other liabilities and other assets, respectively, in the Company’s Unaudited Condensed Consolidated Balance Sheets at March 31, 2021. On April 22, 2020, the Supreme Court of the State of New York dismissed the State Case in its entirety and without leave to amend. On August 13, 2020, the plaintiffs in the State Case filed a notice of appeal of the court's order. Plaintiffs did not timely file their appeal, and the State Case is therefore concluded. Regulatory matter. We have, from time to time in the normal course of our business, received or are subject to, inquiries or investigations by regulators regarding the GreenSky program, including the origination and servicing of consumer loans, practices by merchants or other third parties, and licensing and registration requirements. In connection with one of these matters, the staff of the Consumer Financial Protection Bureau ("CFPB") has informed us that, unless the parties are able to reach a settlement, the CFPB intends to bring an enforcement action against us relating to certain of our policies, procedures and processes, including loan origination processes. We believe that it is in our best interest to determine whether this matter can be resolved on terms acceptable to us and are actively engaged in settlement discussions with the staff of the CFPB. We have recorded an estimated liability in connection with this matter in accordance with ASC 450-20, Contingencies: Loss Contingencies , as of March 31, 2021, based on settlement discussions to date. The estimated liability is recorded in other liabilities in the Company’s Unaudited Condensed Consolidated Balance Sheets at March 31, 2021 and December 31, 2020. While it is reasonably possible that the outcome of this matter, which could result in injunctive action, a civil monetary penalty and customer remediation, could have a material adverse effect on our financial statements, we cannot reasonably estimate a range of loss beyond the estimated liability recorded. Other matters. We are also involved in a number of other proceedings concerning matters arising in connection with the ordinary conduct of our business. While the ultimate outcome of such proceedings cannot be determined, we do not believe that the resolution of these other proceedings, individually or in the aggregate, will have a material adverse effect on our financial condition, results of operations or cash flows. With respect to all legal proceedings, it is our policy to recognize legal fees as they are incurred as a sales, general and administrative expense in our Consolidated Statements of Operations. Financial Guarantees As of March 31, 2021, the contingent aspect of our financial guarantee was measured under ASC 326, Financial Instruments – Credit Losses , which requires us to estimate expected credit losses, and the impact of those estimates on our required payments under the financial guarantee arrangement, for loans within our Bank Partner portfolios that are either funded or approved for funding at the measurement date, but precludes us from including future loan originations by our Bank Partners. Consistent with the modeling of loan losses for any consumer loan portfolio assumed to go into "run-off," our recognized financial guarantee liability under this model represents a significant portion of the contractual escrow that we establish with each Bank Partner. Typically, changes in the estimated financial guarantee liability as measured under ASC 326 are driven primarily by new Bank Partner loans that are facilitated on our platform during the period and thereby increase the contractual escrow balance and, to a lesser degree, by changes in underlying assumptions. We use a discounted cash flow method to estimate our expected risk of loss under the contingent aspect of our financial guarantees for each Bank Partner. Significant assumptions for each Bank Partner portfolio used in valuing our financial guarantee liability include the following: Loan portfolio composition: We forecast each Bank Partner's loan portfolio composition in a "run-off" scenario, which is primarily impacted by expected loan prepayments and paydowns derived from historical behavior curves for each loan plan and were applied to each Bank Partner's portfolio based on its composition of loans and where such loans were in their economic life cycle at the measurement date. The loan portfolio composition additionally informs our forecasts of the components that determine our incentive payments or, alternatively, escrow usage. All other factors remaining constant, generally the higher the expected prepayments and pay down rates, the lower the measurement of our financial guarantee liability, as our contractual escrow balance is calculated based on the month-end outstanding portfolio balance. Credit losses : We use lifetime historical credit loss experience for each loan plan comprising a Bank Partner's loan portfolio as a basis for estimating future credit losses. In assessing the current conditions and forecasts of future conditions as of March 31, 2021, we primarily considered the current and expected economic impacts of the COVID-19 pandemic on the macroeconomic environment, as well as initiatives undertaken by the Company to mitigate credit losses, such as the emphasis on our Bank Partners' super-prime promotional loan programs with our merchants and offering loan deferral options to GreenSky program borrowers. All other factors remaining constant, higher credit losses reduce our incentive payments and thereby increase our risk of loss for escrow usage. Generally, higher credit losses earlier in the forecast period expose us to greater risk of loss under our financial guarantee arrangements, as the contractual escrow balance is highest early in the forecast period in conjunction with the outstanding portfolio balance in a "run-off" scenario. As of March 31, 2021 and December 31, 2020, the estimated value of the escrow financial guarantee was $124.2 million and $131.9 million, respectively, relative to our $175.3 million and $173.2 million contractual escrow that was included in our restricted cash balance as of March 31, 2021 and December 31, 2020, respectively. We recognized financial guarantee benefit of $3.9 million and financial guarantee expense of $18.4 million during the three months ended March 31, 2021 and 2020, respectively, in the Unaudited Condensed Consolidated Statements of Operations. Refer to Note 1 for additional discussion of our accounting for financial guarantees. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2021 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party TransactionsLeaseWe lease office space from a related party under common management control for which lease expense is recognized within related party expenses in the Unaudited Condensed Consolidated Statements of Operations and for which operating lease ROU assets and operating lease liabilities are recognized within those respective line items in the Unaudited Condensed Consolidated Balance Sheets. Total operating lease cost related to this office space was $435 thousand and $435 thousand for the three months ended March 31, 2021 and 2020, respectively. Operating lease ROU assets and operating lease liabilities related to this office space were $3.5 million and $4.1 million, respectively, as of March 31, 2021, and $3.9 million and $4.5 million, respectively, as of December 31, 2020. |
Segment Reporting
Segment Reporting | 3 Months Ended |
Mar. 31, 2021 | |
Segment Reporting [Abstract] | |
Segment Reporting | Segment ReportingWe conduct our operations through a single operating segment and, therefore, one reportable segment. There are no significant concentrations by state or geographical location, nor are there any significant individual customer concentrations by balance. |
Variable Interest Entities
Variable Interest Entities | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Variable Interest Entities | Variable Interest Entities Upon completion of our IPO, GreenSky, Inc. became the managing member of GS Holdings with 100% of the management and voting power in GS Holdings. In its capacity as managing member, GreenSky, Inc. has the sole authority to make decisions on behalf of GS Holdings and bind GS Holdings to agreements. GS Holdings maintains separate capital accounts for its investors as a mechanism for tracking earnings and subsequent distribution rights. Accordingly, management concluded that GS Holdings is a limited partnership or similar legal entity as contemplated in ASC 810, Consolidation . Further, management concluded that GreenSky, Inc. is GS Holdings' primary beneficiary and, as such, GreenSky, Inc. consolidates the results of GS Holdings for financial reporting purposes under the variable interest consolidation model guidance in ASC 810. GreenSky, Inc.’s relationship with GS Holdings results in no recourse to the general credit of GreenSky, Inc. GS Holdings and its consolidated subsidiaries represent GreenSky, Inc.’s sole investment. GreenSky, Inc. shares in the income and losses of GS Holdings in direct proportion to GreenSky, Inc.’s ownership percentage. Further, GreenSky, Inc. has no contractual requirement to provide financial support to GS Holdings. GSLLC is a wholly-owned subsidiary of GS Holdings and is consolidated with GS Holdings. In May 2020, GSLLC formed Depositor as an indirect subsidiary, which in turn formed the Warehouse SPV as an indirect subsidiary, for the purposes of establishing the Warehouse Facility to fund purchases of loan participations. GSLLC, on behalf of the Bank Partner that owns the loans underlying the loan participations, serves as the designated servicer of the Warehouse SPV’s loan receivables held for sale. Management concluded that the Warehouse SPV is a variable-interest entity. GSLLC is the primary beneficiary and consolidates the Warehouse SPV under the variable interest consolidation model guidance under ASC 810 . The Warehouse SPV's relationship with GSLLC results in no recourse to the general credit of the Company. Further, the Company has no contractual requirement to provide financial support to the Warehouse SPV. In addition, each of the Warehouse SPV and Depositor is a separate legal entity from the Company and from each other subsidiary of the Company, the respective assets of the Warehouse SPV and Depositor are owned by the Warehouse SPV and Depositor, respectively, and are solely available to satisfy their respective creditors. As such, neither the Warehouse SPV’s assets nor Depositor’s assets are available to satisfy obligations of GreenSky, Inc., GS Holdings, GSLLC or other subsidiaries of the Company. Pursuant to the Facility Bank Partner Agreements, GreenSky acts as servicer on behalf of a Bank Partner for the loans with respect to which loan participations have been sold to third parties. GreenSky has concluded that the third parties that purchased loan participations are variable interest entities and, primarily as a result of this at-market servicing arrangement, GreenSky maintains a variable interest in the third party purchasers. However, as GreenSky is not the primary beneficiary of the purchasers and does not consolidate the purchasers, GreenSky lacks the power to direct the activities of the purchasers that most significantly impact their economic performance. Our exposure to loss is limited to compensation provided through the servicing arrangement and the Company would only experience a loss if it were required to repurchase a loan participation due to a breach in representations and warranties associated with its loan sale or servicing contracts. GreenSky did not provide any financial support to the variable interest entities in 2021. The loan participations transferred to the purchasers qualified for sales treatment under ASC 860, Transfers and Servicing , as the participations were legally isolated from the Company, the purchasers had the right to freely pledge or exchange their interests in the participations, and the Company does not maintain effective control over the transferred participations. Below are tabular disclosures that provide insight into how GS Holdings, inclusive of the Warehouse SPV, affects GreenSky, Inc.’s financial position, performance and cash flows. Prior to the IPO and Reorganization Transactions, GreenSky, Inc. did not have any variable interest in GS Holdings. The following table presents the balances related to GS Holdings, inclusive of the Warehouse SPV, that are included in the Unaudited Condensed Consolidated Balance Sheets as of the dates indicated, inclusive of GreenSky, Inc.'s interest in the variable interest entity. March 31, 2021 December 31, 2020 Assets Cash and cash equivalents $ 161,890 $ 116,231 Restricted cash 300,414 319,879 Loan receivables held for sale, net 342,943 571,415 Accounts receivable, net 18,489 21,958 Property, equipment and software, net 21,826 21,452 Other assets 55,223 51,965 Total assets (1) $ 900,785 $ 1,102,900 Liabilities and Members Equity (Deficit) Liabilities Accounts payable $ 31,117 $ 15,418 Accrued compensation and benefits 10,299 13,666 Other accrued expenses 12,115 5,207 Finance charge reversal liability 167,436 185,134 Term loan 452,269 452,806 SPV facility 295,877 502,830.00 Financial guarantee liability 124,217 131,894 Other liabilities 85,061 80,478 Total liabilities (2) 1,178,391 1,387,433 Members Equity (Deficit) Equity (deficit) attributable to Continuing LLC Members (161,614) (169,484) Equity (deficit) attributable to GreenSky, Inc. (115,992) (115,049) Total members equity (deficit) (277,606) (284,533) Total liabilities and members equity (deficit) $ 900,785 $ 1,102,900 (1) Includes $355.5 million and $600.8 million of assets held by the Warehouse SPV as of March 31, 2021 and December 31, 2020, respectively. (2) Includes $296.8 million and $503.9 million of liabilities held by the Warehouse SPV as of March 31, 2021 and December 31, 2020, respectively. The following table reflects the impact of consolidation of GS Holdings, inclusive of the Warehouse SPV, into the Unaudited Condensed Consolidated Statements of Operations for the periods indicated. Three Months Ended March 31, 2021 2020 Total revenue $ 125,172 $ 121,857 Total costs and expenses 105,456 129,649 Operating profit 19,716 (7,792) Total other income (expense), net (5,722) (4,106) Net income (loss) $ 13,994 $ (11,898) The following table reflects the cash flow impact of GS Holdings, inclusive of the Warehouse SPV, on the Unaudited Condensed Consolidated Statements of Cash Flows for the periods indicated. Three Months Ended March 31, 2021 2020 Net cash provided by operating activities $ 245,135 $ 41,047 Net cash used in investing activities (3,452) (3,354) Net cash used in financing activities (215,489) (49,813) Net increase (decrease) in cash and cash equivalents and restricted cash 26,194 (12,120) Cash and cash equivalents and restricted cash at beginning of period 436,110 427,811 Cash and cash equivalents and restricted cash at end of period $ 462,304 $ 415,691 |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Subsequent to March 31, 2021, the following events have occurred: Funding Capacity and Loan Sales • An existing Bank Partner increased its revolving commitment by $500 million to $2.0 billion and extended its commitment for an additional two years into the fourth quarter of 2023. • An institutional investor with which the Company entered into a $1 billion, one-year forward flow purchase commitment in the first quarter of 2021, increased its purchase commitment by an additional $500 million (increasing the aggregate purchase commitment to $1.5 billion), in connection with the inclusion of additional loan product types to the forward flow arrangement. Loan participation sales of approximately $273 million were completed in April under the arrangement. Distributions In April 2021, GS Holdings finalized and paid tax distributions of $3.8 million to its members, including previously declared but unpaid non-tax distributions of $157 thousand to certain of its members upon vesting of their equity in GS Holdings. |
Organization, Summary of Sign_2
Organization, Summary of Significant Accounting Policies and New Accounting Standards (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | Organization Unless the context requires otherwise, "we," "us," "our," "GreenSky" and "the Company" refer to GreenSky, Inc. and its subsidiaries. "Bank Partners" are the federally insured banks that originate loans under the consumer financing and payments program that we administer for use by merchants on behalf of such banks in connection with which we provide point-of-sale financing and payments technology and related marketing, servicing, collection and other services (the "GreenSky program" or "program"). We are a leading technology company Powering Commerce at the Point of Sale ® . Our platform is powered by a proprietary, patented technology infrastructure that facilitates merchant sales, while reducing the friction and improving the economics associated with a consumer making a purchase and a lender or financial institution extending financing for that purchase. It supports the full transaction lifecycle, including credit application, underwriting, real-time allocation to our Bank Partners, document distribution, funding, settlement and servicing. Merchants using our platform, which presently range from small, owner-operated home improvement contractors and healthcare providers to large national home improvement brands and retailers and healthcare service organizations, rely on us to facilitate low or deferred interest promotional point-of-sale financing and payments solutions that enable higher sales volume than they could otherwise achieve on their own. Consumers on our platform, who to date primarily have super-prime or prime credit scores, find financing with promotional terms to be an attractive alternative to other forms of payment. Our Bank Partners' access to our proprietary technology solution and merchant network enables them to build a diversified portfolio of high-quality consumer loans with attractive risk-adjusted yields with minimal upfront investment. GreenSky, Inc. was formed as a Delaware corporation on July 12, 2017. The Company was formed for the purpose of completing an initial public offering ("IPO") of its Class A common stock and certain Reorganization Transactions, as further described in the GreenSky, Inc. Form 10-K filed with the U.S. Securities and Exchange Commission ("SEC") on March 10, 2021 (the "2020 Form 10-K"), in order to carry on the business of GreenSky, LLC (“GSLLC”), a Georgia limited liability company. GSLLC is an operating entity and wholly-owned subsidiary of GS Holdings, LLC ("GS Holdings"). GS Holdings, a holding company with no operating assets or operations other than its equity interest in GSLLC, was organized to serve as a holding company for GSLLC. On August 24, 2017, GS Holdings acquired a 100% interest in GSLLC. The equity of GS Holdings is owned partially by GreenSky, Inc. and partially by certain pre-IPO equity owners of GS Holdings. Common membership interests of GS Holdings are referred to as "Holdco Units." On May 24, 2018, the Company's Class A common stock commenced trading on the Nasdaq Global Select Market in connection with its IPO. The IPO and Reorganization Transactions resulted in the Company becoming the sole managing member of GS Holdings. As the sole managing member of GS Holdings, we operate and control all of GS Holdings’ operations and, through GS Holdings and its subsidiaries, conduct GS Holdings’ business. The Company consolidates the financial results of GS Holdings and reports a noncontrolling interest in its Unaudited Condensed Consolidated Financial Statements representing the GS Holdings interests held by the Continuing LLC Members, as such term is defined in the 2020 Form 10-K. The weighted average ownership percentages for the applicable reporting periods are used to attribute net income (loss) and other comprehensive income (loss) to the Company and the noncontrolling interest. In 2020, we formed GS Depositor I, LLC (“Depositor”), an indirect subsidiary of the Company, and GS Investment I, LLC (the “Warehouse SPV”), a special purpose vehicle and indirect subsidiary of the Company, to facilitate purchases of participation interests in loans (“Warehouse Loan Participations") originated by Bank Partners through the GreenSky program. These purchases are made by Depositor and then transferred to the Warehouse SPV. Each of the Warehouse SPV and Depositor is a separate legal entity from the Company, and the assets of the Warehouse SPV and Depositor are solely available to satisfy the creditors of the Warehouse SPV or Depositor, respectively. |
Basis of Presentation | Basis of PresentationThe Unaudited Condensed Consolidated Financial Statements were prepared in accordance with the rules and regulations of the SEC for interim financial statements. We condensed or omitted certain notes and other information from the interim financial statements presented in this Quarterly Report on Form 10-Q. Therefore, these interim statements should be read in conjunction with the 2020 Form 10-K. In the opinion of management, the Unaudited Condensed Consolidated Financial Statements reflect all adjustments, which are of a normal recurring nature, necessary for a fair statement of our financial condition and results of operations for the interim periods presented. The condensed consolidated balance sheet as of December 31, 2020 was derived from the audited annual consolidated financial statements, but does not contain all of the footnote disclosures from the annual consolidated financial statements required by United States generally accepted accounting principles ("GAAP"). All intercompany balances and transactions are eliminated upon consolidation. The results for the three months ended March 31, 2021 are not necessarily indicative of results expected for the full year. |
Reclassifications | Certain reclassifications have been made to the prior year presentation to conform to the current year presentation in the Unaudited Condensed Consolidated Statements of Operations. |
Use of Estimates | Use of Estimates The preparation of our financial statements in conformity with GAAP requires that management make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Such estimates and assumptions include, but are not limited to, those that relate to fair value measurements, financial guarantees, share-based compensation and income taxes. In developing estimates and assumptions, management uses all available information; however, actual results could materially differ from those estimates and assumptions. |
Cash and Cash Equivalents and Restricted Cash | Cash and Cash Equivalents and Restricted Cash Cash and Cash Equivalents Cash includes non-interest and interest-bearing demand deposit accounts with various financial institutions. We consider all highly liquid investments that mature three months or less from the date of purchase to be cash equivalents. Cash equivalents include money market mutual fund accounts, which are invested in government securities that are either guaranteed by the Federal Deposit Insurance Corporation of the U.S. government ("FDIC") or are secured by U.S. government-issued collateral for which the risk of loss from nonpayment is presumed to be zero. As such, we do not establish an allowance for credit losses on our cash equivalents. Further, the carrying amounts of our cash equivalents approximate their fair values due to their short maturities and highly liquid nature. Refer to Note 3 for additional information on our fair value measurement. Restricted Cash Restricted cash includes cash held in interest-bearing escrow accounts to provide limited protection to our Bank Partners in the event of certain Bank Partner portfolio credit losses or in the event that the finance charges billed to borrowers do not exceed the sum of an agreed-upon portfolio yield, a fixed servicing fee and realized credit losses. Restricted cash also includes cash maintained for certain Bank Partners related to our finance charge reversal ("FCR") liability, certain custodial in-transit loan funding and consumer borrower payments that were restricted from use for our operations, and cash related to collections in connection with Warehouse Loan Participations. Refer to Note 14 for additional information. |
Accounts Receivable | Accounts Receivable Accounts receivable are recorded at their original invoice amounts, which are reduced by any allowance for uncollectible amounts. We use the aging method to establish an allowance for expected credit losses on accounts receivable balances and consider whether current conditions or reasonable and supportable forecasts about future conditions warrant an adjustment to our historical loss experience. In applying such adjustments, we primarily consider changes in counterparty credit risk and changes in the underlying macroeconomic environment. Accounts receivable are written off once delinquency exceeds 90 days. Recoveries of previously written off accounts receivable are recognized on a collected basis as a reduction to the provision for credit losses, which is included within sales, general and administrative expense in the Unaudited Condensed Consolidated Statements of Operations. Refer to Note 5 for additional information on our accounts receivable. |
Fair Value of Assets and Liabilities | Fair Value of Assets and Liabilities We have financial assets and liabilities subject to fair value measurement or disclosure on either a recurring or nonrecurring basis. Such measurements or disclosures relate to our cash and cash equivalents, loan receivables held for sale, derivative instruments, servicing assets and liabilities, contingent consideration receivables, and term loan. ASC 820, Fair Value Measurement , defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In valuing this asset or liability, we utilize market data or reasonable assumptions that market participants would use, including assumptions about risk and the risks inherent in the inputs to the valuation technique. The guidance provides a three-level valuation hierarchy for disclosure of fair value measurements based on the transparency of inputs to the valuation of an asset or a liability as of the measurement date. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels are defined as follows: Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2: Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability. Level 3: Unobservable inputs for the asset or liability. |
Derivative Instruments | Derivative Instruments We are exposed to interest rate risk on our variable-rate term loan, which we manage by entering into an interest rate swap that is determined to be a derivative in accordance with ASC 815, Derivatives and Hedging . Derivatives are recorded on the balance sheet at fair value and are marked-to-market on a quarterly basis. The accounting for the change in fair value of derivatives depends on the intended use of the derivative, whether the Company has elected to designate the derivative as a hedge and apply hedge accounting, and whether the hedging relationship continues to satisfy the criteria required to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to variability in cash flows of a recognized asset or liability that is attributable to a particular risk are considered cash flow hedges. The primary purpose of cash flow hedge accounting is to link the income statement recognition of a hedging instrument and a hedged item whose changes in cash flows are expected to offset each other. The change in the fair value of the derivative instrument designated as a cash flow hedge is initially reported as a component of other comprehensive income (loss) and subsequently reclassified into earnings in the same period when the hedged item affects earnings. The reclassification into earnings is reported in the same income statement line item in which the hedged item is reported. The FCR component of our Bank Partner contracts, which arrangements are detailed in Note 3, qualifies as an embedded derivative. The FCR liability is not designated as a hedge for accounting purposes and, as such, changes in its fair value are recorded within cost of revenue in the Unaudited Condensed Consolidated Statements of Operations. We have other embedded derivative instruments that are not designated as hedges. Refer to Note 3 and Note 8 for additional fair value and derivative disclosures. |
Financial Guarantees | Financial Guarantees Under the terms of the contracts with our Bank Partners, we provide limited protection to the Bank Partners in the event of certain Bank Partner portfolio credit losses or in the event that the finance charges billed to borrowers do not exceed the sum of an agreed-upon portfolio yield, a fixed servicing fee and realized credit losses, by holding cash in restricted, interest-bearing escrow accounts in an amount equal to a contractual percentage of the Bank Partners’ monthly originations and month-end outstanding portfolio balance. Our maximum exposure under these financial guarantees is contractually limited to the escrow that we establish with each Bank Partner. Cash set aside to meet this requirement is classified as restricted cash in our Unaudited Condensed Consolidated Balance Sheets. Our contracts with our Bank Partners entitle us to incentive payments when the finance charges billed to borrowers exceed the sum of an agreed-upon portfolio yield, a fixed servicing fee and realized credit losses. This incentive payment varies from month to month, primarily due to the amount of realized credit losses. If credit losses exceed an agreed-upon threshold, we are obligated to make limited payments to our Bank Partners, which obligation represents a financial guarantee in accordance with ASC 460, Guarantees . Under ASC 460, the guarantor undertakes a noncontingent obligation to stand ready to perform over the term of the guarantee and a contingent obligation to make future payments if the triggering events or conditions under the guarantee arrangements occur. Under ASU 2016-13, we are required to estimate the expected credit losses over the contractual period in which we are exposed to credit risk via a present contractual obligation to extend credit, unless that obligation is unconditionally cancellable by the issuer. As applied to our financial guarantee arrangements, we are required to estimate expected credit losses, and the impact of those estimates on our potential escrow payments, for loans within our Bank Partner portfolios that are either funded or approved for funding at the measurement date, but are precluded from including future loan originations by our Bank Partners. Consistent with the modeling of loan losses for any consumer loan portfolio assumed to go into "run-off," our recognized financial guarantee liability under this model represents a significant portion of the contractual escrow established with each Bank Partner. Typically, additional financial guarantee liabilities are recorded as new Bank Partner loans are facilitated on our platform, along with a corresponding non-cash charge recorded as financial guarantee expense in the Unaudited Condensed Consolidated Statements of Operations. |
Consolidation | Consolidation In the normal course of our business, we may enter into an agreement for management, servicing, or related services or hold ownership interests in special purpose entities. We evaluate our interests and/or involvement in these entities to determine whether they meet the definition of a variable interest entity ("VIE"), pursuant to ASC 810, Consolidation , and whether we are required to consolidate these entities. |
Recently Adopted Accounting Standards and Accounting Standards Issued but Not Yet Adopted | Recently Adopted Accounting Standards Simplifying the Accounting for Income Taxes In December 2019, the FASB issued ASU 2019-12, which modifies ASC 740, Income Taxes, to simplify the accounting for income taxes by removing certain exceptions, including intraperiod tax allocations and the calculation of income taxes in an interim period when in a loss position. Our adoption of this standard on January 1, 2021 did not have a material effect on our Unaudited Condensed Consolidated Financial Statements. Accounting Standards Issued, But Not Yet Adopted Facilitation of the Effects of Reference Rate Reform on Financial Reporting In March 2020, the FASB issued ASU 2020-04, which provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions that reference the London Interbank Offered Rate ("LIBOR") or another reference rate expected to be discontinued because of reference rate reform, if certain criteria are met. The standard applies to contract modifications that replace a reference rate affected by reference rate reform and contemporaneous modifications of other contract terms related to the replacement of the reference rate. Further, the standard provides exceptions to certain guidance in ASC 815, Derivatives and Hedging , related to changes to the critical terms of a hedging relationship due to reference rate reform and provides optional expedients for fair value, cash flow and net investment hedging relationships for which the component excluded from the assessment of hedge effectiveness is affected by reference rate reform. This standard is effective as of March 12, 2020, and an entity may elect to adopt it through December 31, 2022 based on applying as of the beginning of an interim period up to the date that the financial statements are available to be issued. Once elected, the provisions of the standard must be applied prospectively for all similar eligible contract modifications. We have not yet elected an adoption date, are currently identifying arrangements referenced to rates, such as US dollar LIBOR, that are expected to be discontinued, and are evaluating our options for modifying such arrangements in accordance with the standard. We will continue to assess and plan for how the phase out of LIBOR will affect the Company; however, while the LIBOR transition could adversely affect the Company, we do not expect the impact to be material to the Company. |
Organization, Summary of Sign_3
Organization, Summary of Significant Accounting Policies and New Accounting Standards (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of cash and cash equivalents | The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the Unaudited Condensed Consolidated Balance Sheets to the total included within the Unaudited Condensed Consolidated Statements of Cash Flows as of the dates indicated. March 31, 2021 2020 Cash and cash equivalents $ 196,298 $ 176,707 Restricted cash 300,414 272,966 Cash and cash equivalents and restricted cash in Unaudited Condensed Consolidated Statements of Cash Flows $ 496,712 $ 449,673 |
Schedule of restricted cash | The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the Unaudited Condensed Consolidated Balance Sheets to the total included within the Unaudited Condensed Consolidated Statements of Cash Flows as of the dates indicated. March 31, 2021 2020 Cash and cash equivalents $ 196,298 $ 176,707 Restricted cash 300,414 272,966 Cash and cash equivalents and restricted cash in Unaudited Condensed Consolidated Statements of Cash Flows $ 496,712 $ 449,673 |
Revenue disaggregated by type of service | Revenue disaggregated by type of service was as follows for the periods presented: Three Months Ended March 31, 2021 2020 Merchant fees $ 81,159 $ 81,415 Interchange fees 4,498 8,469 Transaction fees 85,657 89,884 Servicing (1) 34,667 31,283 Interest income (2) 4,847 687 Other (3) 1 3 Interest and other 4,848 690 Total revenue $ 125,172 $ 121,857 (1) For the three months ended March 31, 2021 and 2020, includes increases in the fair value of our servicing asset of $7.1 million and $1.8 million, respectively. Refer to Note 3 for additional information. (2) Includes interest income earned on loan receivables held for sale. |
Earnings per Share (Tables)
Earnings per Share (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Basic and diluted earnings per share | The following table sets forth reconciliations of the numerators and denominators used to compute basic and diluted earnings per share of Class A common stock for the periods indicated. Three Months Ended 2021 2020 Numerator: Income (loss) before income tax expense (benefit) $ 13,997 $ (11,814) Less: Net income (loss) attributable to noncontrolling interests 8,327 (7,585) Less: Income tax expense (benefit) 1,872 (895) Net income (loss) attributable to GreenSky, Inc. – basic $ 3,798 $ (3,334) Add: Reallocation of net income attributable to noncontrolling interests from the assumed exchange of Holdco Units for Class A common stock 8,327 — Less: Income tax expense on reallocation of net income attributable to noncontrolling interests (1) 2,755 — Net income (loss) attributable to GreenSky, Inc. – diluted $ 9,370 $ (3,334) Denominator: Weighted average shares of Class A common stock outstanding – basic 71,859,110 63,650,697 Add: Dilutive effects, as shown separately below Holdco Units exchangeable for Class A common stock 105,815,474 — Class A common stock options 116,401 — Unvested Class A common stock 1,741,441 — Weighted average shares of Class A common stock outstanding – diluted 179,532,426 63,650,697 Earnings (loss) per share of Class A common stock outstanding – basic $ 0.05 $ (0.05) Earnings (loss) per share of Class A common stock outstanding – diluted $ 0.05 $ (0.05) Excluded from diluted earnings per share, as their inclusion would have been anti-dilutive (2) Holdco Units 241,439 113,301,368 Class A common stock options 2,065,517 3,859,794 Class A common stock awards 2,888,542 2,405,122 (1) We assumed effective tax rates of 33.1% and 21.2% for the three months ended March 31, 2021 and 2020, respectively, which represents the effective tax rates on the consolidated GreenSky, Inc. entity inclusive of the income taxes on the portion of GS Holdings' earnings that are attributable to noncontrolling interests. (2) These amounts represent the number of instruments outstanding at the end of the period. Application of the treasury stock method would reduce these amounts if they had a dilutive effect and were included in the computation of diluted earnings per share. |
Fair Value of Assets and Liab_2
Fair Value of Assets and Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Carrying amounts and estimated fair values of assets and liabilities measured at fair value on a recurring or nonrecurring basis | The following table summarizes, by level within the fair value hierarchy, the carrying amounts and estimated fair values of our assets and liabilities measured at fair value on a recurring or nonrecurring basis or disclosed, but not carried, at fair value in the Unaudited Condensed Consolidated Balance Sheets as of the dates presented. There were no transfers into, out of, or between levels within the fair value hierarchy during any of the periods presented. Refer to Note 4, Note 7, Note 8 and Note 9 for additional information on these assets and liabilities. Level March 31, 2021 December 31, 2020 Carrying Fair Carrying Fair Assets: Cash and cash equivalents (1) 1 $ 196,298 $ 196,298 $ 147,775 $ 147,775 Loan receivables held for sale, net (2) 2 342,943 345,720 571,415 575,279 Servicing assets (3) 3 37,944 37,944 30,804 30,804 Contingent consideration receivables (3) 3 1,811 1,811 — — Interest rate cap (3) 2 251 251 — — Liabilities: Finance charge reversal liability (3) 3 $ 167,436 $ 167,436 $ 185,134 $ 185,134 Term loan (1) 2 452,269 450,798 452,806 452,408 Interest rate swap (3) 2 12,116 12,116 14,182 14,182 Servicing liabilities (3) 3 1,619 1,619 1,984 1,984 Sales facilitation obligations (3) 2 19,264 19,264 10,655 10,655 (1) Disclosed, but not carried, at fair value. (2) Measured at fair value on a recurring basis. (3) Measured and carried at fair value on a recurring basis. |
Schedule of servicing assets at fair value | The following table reconciles the beginning and ending fair value measurements of our servicing assets associated with Bank Partner loans during the periods presented. Three Months Ended March 31, 2021 2020 Beginning balance $ 30,804 $ 30,459 Additions, net (1) 11,347 2,098 Changes in fair value (4,207) (309) Ending balance $ 37,944 $ 32,248 (1) Includes additions through assumptions of servicing obligations each time a loan is originated on our platform by a Bank Partner, as well as through transfers of loan receivables between Bank Partners or of loan receivables between GreenSky and Bank Partners and is net of the impact of loan principal pay downs in the Bank Partner portfolios. Additions are recognized in servicing revenue in the Unaudited Condensed Consolidated Statements of Operations. The following table reconciles the beginning and ending fair value measurements of our contingent consideration receivables during the period presented. Three Months Ended 2021 Beginning balance $ — Additions (1) 1,811 Receipts (2) — Other fair value changes (3) — Ending balance $ 1,811 (1) Includes each initial receivable that GreenSky is entitled to each time an applicable pool of loan participations is sold to institutional investors, financial institutions and other financing sources. (2) Represents cash receipt of contingent consideration. |
Schedule of servicing liabilities at fair value | The following table reconciles the beginning and ending fair value measurements of our servicing liabilities associated with transferring our rights to charged-off receivables during the periods presented. Three Months Ended March 31, 2021 2020 Beginning balance $ 1,984 $ 3,796 Changes in fair value (1) (365) (517) Ending balance $ 1,619 $ 3,279 (1) Represents the reduction of our servicing liabilities due to the passage of time and collection of loan payments and recognized in other gains (losses), net in the Unaudited Condensed Consolidated Statements of Operations. |
Schedule of fair value assumption, servicing assets or liabilities | The following table presents quantitative information about the significant unobservable inputs used to value the Level 3 servicing assets and liabilities as of the dates presented. Input March 31, 2021 December 31, 2020 Range Weighted Average Range Weighted Average Cost of servicing (basis points) 62.5 – 100.0 86.0 57.5 – 108.0 95.0 Discount rate 18.0 % 18.0% 18.0 % 18.0% Weighted average remaining life (years) 2.6 – 5.8 2.6 2.3 – 5.8 2.3 Recovery period (years) 1.3 - 3.7 2.9 1.6 – 3.9 3.1 |
Reconciliation of the beginning and ending fair value measurements of FCR Liability | The following table reconciles the beginning and ending fair value measurements of our FCR liability during the periods indicated. Three Months Ended March 31, 2021 2020 Beginning balance $ 185,134 $ 206,035 Receipts (1) 51,266 44,708 Settlements (2) (95,381) (90,089) Fair value changes recognized in cost of revenue (3) 26,417 52,504 Ending balance $ 167,436 $ 213,158 (1) Includes: (i) incentive payments from Bank Partners, which is the surplus of finance charges billed to borrowers over an agreed-upon portfolio yield, a fixed servicing fee and realized net credit losses and (ii) cash received from recoveries on previously charged-off Bank Partner loans. We consider all monthly incentive payments from Bank Partners during the period to be related to billed finance charges on deferred interest products until monthly incentive payments exceed total billed finance charges on deferred products, which did not occur during the periods presented. (2) Represents the reversal of previously billed finance charges associated with deferred payment loan principal balances that were repaid within the promotional period. The three months ended March 31, 2021 also includes $2.6 million of billed finance charges related to loan participations held by the Warehouse SPV that were not yet collected and subject to a potential future finance charge reversal at the time of purchase, which were paid to the Bank Partner in full as of the participation purchase dates. (3) A fair value adjustment is made based on the expected reversal percentage of billed finance charges (expected settlements), which is estimated at each reporting date. The fair value adjustment is recognized in cost of revenue in the Unaudited Condensed Consolidated Statements of Operations. |
Significant unobservable inputs used to value Level 3 FCR liability | The following table presents quantitative information about the significant unobservable inputs used to value the Level 3 FCR liability as of the dates presented. March 31, 2021 December 31, 2020 Range Weighted Average Range Weighted Average Reversal rate 64.8% – 100.0% 89.9 % 64.8 – 100.0% 89.2 % Discount rate 3.5 % 3.5 % 3.5 % 3.5 % |
Loan Receivables Held for Sale
Loan Receivables Held for Sale (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Receivables [Abstract] | |
Activity in the balance of loan receivables held for sale | The following table summarizes the activity in the balance of loan receivables held for sale, net at lower of cost or fair value during the periods indicated. Three Months Ended March 31, 2021 2020 Beginning balance $ 571,415 $ 51,926 Additions (1) 225,209 1,071 Proceeds from sales and borrower payments (2) (446,416) (29,035) Loss on sale (3,371) — Decrease (increase) in valuation allowance (3) (2,244) 288 Transfers (4) 872 56 Write-offs and other (5) (2,522) (3,247) Ending balance $ 342,943 $ 21,059 (1) Includes purchase of $209.5 million participations in loans through the Warehouse SPV, which was established in mid-2020. (2) We retain servicing arrangements on sold loan receivables with comparable terms and conditions as loans that are not participated by our Bank Partners. Additions also include accrued interest and fees and recoveries of previously charged-off loan receivables held for sale. Income from loan receivables held for sale activities is recorded within interest and other revenue in the Unaudited Condensed Consolidated Statements of Operations. (3) During the three months ended March 31, 2021, the valuation allowance increased by $3.5 million due to the change in the lower of cost or fair value adjustment on our Warehouse Loan Participations, partially offset by a decrease in our provision for credit losses of $1.1 million and the lower of cost or fair value adjustment on all other loan receivables held for sale of $135 thousand. During the three months ended March 31, 2020, the valuation allowance decreased for the change in the provision for credit losses. (4) We temporarily hold certain loan receivables, which are originated by a Bank Partner, while non-originating Bank Partner eligibility is being determined. Once we determine that a loan receivable meets the investment requirements of an eligible Bank Partner, we transfer the loan receivable to the Bank Partner at cost plus any accrued interest. The reported amount also includes loan receivables that have been placed on non-accrual and non-payment status while we investigate consumer inquiries. (5) We received recovery payments of $137 thousand and $55 thousand during the three months ended March 31, 2021 and 2020, respectively. Recoveries of principal and finance charges and fees on previously written off loan receivables held for sale are recognized on a collected basis and the cash proceeds received are recorded within sales, general and administrative expense in the Unaudited Condensed Consolidated Statements of Operations. Accounts receivable consisted of the following as of the dates indicated. Accounts Allowance for Accounts March 31, 2021 Transaction related $ 8,150 $ (431) $ 7,719 Servicing related 10,770 — 10,770 Total $ 18,920 $ (431) $ 18,489 December 31, 2020 Transaction related $ 10,533 $ (313) $ 10,220 Servicing related 11,738 — 11,738 Total $ 22,271 $ (313) $ 21,958 |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Receivables [Abstract] | |
Activity in the balance of loan receivables held for sale | The following table summarizes the activity in the balance of loan receivables held for sale, net at lower of cost or fair value during the periods indicated. Three Months Ended March 31, 2021 2020 Beginning balance $ 571,415 $ 51,926 Additions (1) 225,209 1,071 Proceeds from sales and borrower payments (2) (446,416) (29,035) Loss on sale (3,371) — Decrease (increase) in valuation allowance (3) (2,244) 288 Transfers (4) 872 56 Write-offs and other (5) (2,522) (3,247) Ending balance $ 342,943 $ 21,059 (1) Includes purchase of $209.5 million participations in loans through the Warehouse SPV, which was established in mid-2020. (2) We retain servicing arrangements on sold loan receivables with comparable terms and conditions as loans that are not participated by our Bank Partners. Additions also include accrued interest and fees and recoveries of previously charged-off loan receivables held for sale. Income from loan receivables held for sale activities is recorded within interest and other revenue in the Unaudited Condensed Consolidated Statements of Operations. (3) During the three months ended March 31, 2021, the valuation allowance increased by $3.5 million due to the change in the lower of cost or fair value adjustment on our Warehouse Loan Participations, partially offset by a decrease in our provision for credit losses of $1.1 million and the lower of cost or fair value adjustment on all other loan receivables held for sale of $135 thousand. During the three months ended March 31, 2020, the valuation allowance decreased for the change in the provision for credit losses. (4) We temporarily hold certain loan receivables, which are originated by a Bank Partner, while non-originating Bank Partner eligibility is being determined. Once we determine that a loan receivable meets the investment requirements of an eligible Bank Partner, we transfer the loan receivable to the Bank Partner at cost plus any accrued interest. The reported amount also includes loan receivables that have been placed on non-accrual and non-payment status while we investigate consumer inquiries. (5) We received recovery payments of $137 thousand and $55 thousand during the three months ended March 31, 2021 and 2020, respectively. Recoveries of principal and finance charges and fees on previously written off loan receivables held for sale are recognized on a collected basis and the cash proceeds received are recorded within sales, general and administrative expense in the Unaudited Condensed Consolidated Statements of Operations. Accounts receivable consisted of the following as of the dates indicated. Accounts Allowance for Accounts March 31, 2021 Transaction related $ 8,150 $ (431) $ 7,719 Servicing related 10,770 — 10,770 Total $ 18,920 $ (431) $ 18,489 December 31, 2020 Transaction related $ 10,533 $ (313) $ 10,220 Servicing related 11,738 — 11,738 Total $ 22,271 $ (313) $ 21,958 |
Summary of balance of allowance for uncollectible amounts | The following table summarizes the activity in the balance of allowance for uncollectible amounts during the period from January 1, 2021 through March 31, 2021. Allowance for Beginning balance $ (313) Provision for expected losses (170) Write-offs 52 Recoveries — Ending balance $ (431) |
Property, Equipment and Softw_2
Property, Equipment and Software (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property, equipment and software | Property, equipment and software were as follows as of the dates indicated. March 31, 2021 December 31, 2020 Furniture $ 1,592 $ 2,680 Leasehold improvements 3,604 4,399 Computer hardware 2,522 2,690 Software 33,864 30,641 Total property, equipment and software, at cost 41,582 40,410 Less: accumulated depreciation (5,092) (6,580) Less: accumulated amortization (14,664) (12,378) Total property, equipment and software, net $ 21,826 $ 21,452 |
Borrowings (Tables)
Borrowings (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Key details of the term loans | Key details of the term loan are as follows: March 31, 2021 December 31, 2020 Term loan, face value (1) $ 462,438 $ 463,625 Unamortized debt discount (2) (4,843) (5,153) Unamortized debt issuance costs (2) (5,325) (5,666) Term loan $ 452,270 $ 452,806 (1) The principal balance of the term loan is scheduled to be repaid on a quarterly basis at an amortization rate of 0.25% per quarter through December 31, 2024, with the balance due at maturity. |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of notional amounts of outstanding derivative positions | As of March 31, 2021, we had the following outstanding interest rate derivatives that were designated as cash flow hedges of interest rate risk. Notional Amount Fixed Interest Rate Termination Date Interest rate swap $ 350,000 1.80% June 30, 2023 |
Schedule of derivative instruments in statement of financial position, fair value | The following table presents the fair values and Unaudited Condensed Consolidated Balance Sheets locations of our derivative instruments as of the dates indicated. Balance Sheet Location March 31, 2021 December 31, 2020 Designated as cash flow hedges Interest rate swap Other liabilities $ 12,116 $ 14,182 Not designated as hedges FCR liability Finance charge reversal liability $ 167,436 $ 185,134 Sales facilitation obligations Other liabilities 19,264 10,655 Interest rate cap Other assets 251 — |
Derivative instruments, gain (loss) | The following table presents the impacts of our derivative instruments on our Unaudited Condensed Consolidated Statements of Operations for the periods indicated. Three Months Ended March 31, 2021 2020 Designated as cash flow hedges Interest rate swap – gain (loss) reclassified into interest expense $ (1,468) $ (107) Interest rate swap – gain (loss) reclassified into income tax expense 145 9 Not designated as hedges FCR liability – change in fair value recorded in cost of revenue $ 26,417 $ 52,504 Sales facilitation obligations - change in fair value recorded in cost of revenue 8,609 — Interest rate cap - change in fair value recorded in cost of revenue 251 — |
Schedule of accumulated other comprehensive income (loss) | The following table summarizes the changes in the components of accumulated other comprehensive income (loss) associated with our cash flow hedge, which exclude amounts pertaining to noncontrolling interests, for the period presented. Three Months Ended March 31, 2021 2020 Cash Flow Hedge Accumulated other comprehensive income (loss), beginning balance $ (4,340) $ (756) Other comprehensive income (loss) before reclassifications and tax 234 (4,706) Tax (expense) benefit (54) 1,139 Other comprehensive income (loss) before reclassifications, net of tax 180 (3,567) Reclassifications out of accumulated other comprehensive income (loss), net of tax (1) 448 29 Net (increase) decrease in other comprehensive loss 628 (3,538) Accumulated other comprehensive income (loss), ending balance $ (3,712) $ (4,294) |
Other Assets and Liabilities (T
Other Assets and Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Other Liabilities Disclosure [Abstract] | |
Other assets | The following table details the components of other assets in the Unaudited Condensed Consolidated Balance Sheets as of the dates indicated. March 31, 2021 December 31, 2020 Servicing assets (1) $ 37,944 $ 30,804 Right-of-use assets (2) 7,375 8,265 Prepaid expenses (3) 6,015 8,860 Related party receivables 84 88 Insurance recoveries (4) 26,900 — Other receivables and assets 10,015 4,626 Other assets $ 88,333 $ 52,643 (1) We elected the fair value method to account for our servicing assets. Refer to Note 3 for additional information. (2) Right-of-use ("ROU") assets represent our right to use an underlying asset for the lease term. Refer to Note 14 for additional information on our ROU assets. (3) Includes $1.1 million of implementation costs related to a new cloud computing arrangement which is categorized as a hosting arrangement that is a service contract under ASU 2018-15. Amortization for the period ended March 31, 2021 is $50 thousand and accumulated amortization as of March 31, 2021 is $59 thousand. (4) Insurance recoveries related to legal proceedings. Refer to Note 14 for additional information. |
Other liabilities | The following table details the components of other liabilities in the Unaudited Condensed Consolidated Balance Sheets as of the dates indicated. March 31, 2021 December 31, 2020 Transaction processing liabilities $ 31,594 $ 30,169 Servicing liabilities (1) 1,619 1,984 Distributions payable 1,995 3,136 Interest rate swap (2) 12,116 14,182 Tax related liabilities (3) 667 691 Deferred lease liabilities 9,039 10,107 Legal settlement accrual (4) 27,500 — Accruals and other liabilities 8,835 10,245 Sales facilitation obligations (5) 19,264 10,655 Other liabilities $ 112,629 $ 81,169 (1) We elected the fair value method to account for our servicing liabilities. Refer to Note 3 for additional information. (2) Refer to Note 3 and Note 8 for additional information on our interest rate swap, which was in a liability position as of March 31, 2021 and December 31, 2020. (3) Tax related liabilities primarily include certain taxes payable related to the Reorganization Transactions. (4) Refer to Note 14 for additional information on our legal proceedings. (5) Changes in the fair value of the embedded derivative for loan participation commitments are recognized as a mark-to-market in cost of revenue for the period. |
Stockholders Equity (Deficit) (
Stockholders Equity (Deficit) (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Equity [Abstract] | |
Schedule of dividends declared | The following table summarizes activity associated with our non-tax and tax distributions during the periods indicated. Three Months Ended Remaining Reserved Payment (1) (in thousands) 2021 2020 Non-tax distributions previously declared and paid upon vesting Credit Agreement Distributions (2) Distributions $ 769 $ 1,129 $ 1,295 Special Operating Distributions (3) Distributions 372 533 700 Tax distributions 3,388 31,136 N/A Total $ 4,529 $ 32,798 $ 1,995 (1) As of March 31, 2021, all remaining portions of the non-tax distributions were recorded within other liabilities in the Unaudited Condensed Consolidated Balance Sheets. (2) See Note 7 for discussion of distributions using the proceeds from our borrowings. (3) In May 2018, we declared a special operating distribution of $26.2 million and, in December 2017, we declared a $160.0 million special cash distribution to Holdco Unit holders and holders of profits interests. |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Share-based compensation, stock options, activity | Class A common stock option ("Options") activity was as follows during the periods indicated: Three Months Ended Three Months Ended Number of Weighted Number of Outstanding at beginning of period 3,862,926 $ 9.70 4,181,909 Granted — — — Exercised (1)(2) (104,833) 5.65 (105,000) Forfeited (437,698) 7.85 (201,615) Expired (3) (217,476) 12.23 (15,500) Outstanding at end of period (4) 3,102,919 $ 9.93 3,859,794 Exercisable at end of period (4)(5) 1,351,989 $ 11.10 1,543,292 (1) The total intrinsic value of Options exercised, which is defined as the amount by which the market value of the stock on the date of exercise exceeds the exercise price, during the three months ended March 31, 2021 and 2020 was $145 thousand and $205 thousand, respectively. (2) During the three months ended March 31, 2021, employees paid $27 thousand to the Company to exercise Options which resulted in the issuance of 4,833 shares of Class A common stock. In addition, during this period, Options exercisable for 100,000 shares of Class A common stock were exercised by means of a cashless net exercise procedure, which resulted in the issuance of 13,891 shares of Class A common stock and for which the Company withheld taxes of $42 thousand. During the three months ended March 31, 2020, Options exercisable for 105,000 shares of Class A common stock were exercised by means of a cashless net exercise procedure, which resulted in the issuance of 15,051 shares of Class A common stock and for which the Company withheld taxes of $73 thousand. (3) Expired Options represent vested, underwater Options that were not exercised by terminated employees as stipulated in the Option award agreements, generally within 30 days from the employment termination date. (4) The aggregate intrinsic value and weighted average remaining contractual terms of Options outstanding and Options exercisable were as follows as of the date indicated: March 31, 2021 Aggregate intrinsic value (in thousands) Options outstanding $ 2,264 Options exercisable $ 229 Weighted average remaining term (in years) Options outstanding 7.4 Options exercisable 6.3 (5) The total fair value, based on grant date fair value, of Options that vested during the three months ended March 31, 2021 and 2020 was $1.2 million and $1.5 million, respectively. |
Schedule of share-based compensation, options, grants in period, grant date intrinsic value | The aggregate intrinsic value and weighted average remaining contractual terms of Options outstanding and Options exercisable were as follows as of the date indicated: March 31, 2021 Aggregate intrinsic value (in thousands) Options outstanding $ 2,264 Options exercisable $ 229 Weighted average remaining term (in years) Options outstanding 7.4 Options exercisable 6.3 |
Schedule of nonvested share activity | Unvested Holdco Units activity was as follows during the periods indicated: Three Months Ended Three Months Ended Number of Weighted Average Grant Date Number of Unvested at beginning of period 489,486 $ 23.00 1,112,607 Forfeited — 23.00 — Vested (1) (93,800) 23.00 (134,582) Unvested at end of period 395,686 $ 23.00 978,025 (1) The total fair value, based on grant date fair value, of previously unvested Holdco Units that vested during the three months ended March 31, 2021 and 2020 was $2.2 million and $3.1 million, respectively. Unvested Class A common stock activity was as follows during the periods indicated: Three Months Ended Three Months Ended Class A Weighted Average Grant Date Class A Unvested at beginning of period 4,956,922 $ 6.53 2,999,343 Granted 2,019,240 6.77 — Forfeited (1) (380,786) 6.81 (181,794) Vested (2) (302,493) 13.19 (412,427) Unvested at end of period 6,292,883 $ 6.27 2,405,122 (1) Forfeited shares of unvested Class A common stock associated with restricted stock awards are held in our treasury stock account. Refer to Note 11 for additional information on our treasury stock. |
Commitments, Contingencies an_2
Commitments, Contingencies and Guarantees (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Supplemental balance sheet information | Supplemental balance sheet information related to our operating leases was as follows as of the dates indicated. March 31, 2021 December 31, 2020 Operating lease ROU assets $ 7,375 $ 8,265 Operating lease liabilities $ 9,039 $ 10,107 Weighted average remaining lease term (in years) 2.2 2.4 Weighted average discount rate 5.8% 5.8% |
Schedule of operating lease liability, maturity | The following table provides a reconciliation of the total undiscounted cash flows related to our future lease obligations recorded in other liabilities in the Unaudited Condensed Consolidated Balance Sheets in accordance with ASC 842: March 31, 2021 Remainder of 2021 $ 3,688 2022 3,706 2023 1,501 2024 810 2025 — Thereafter — Total lease payments $ 9,705 Less: imputed interest (666) Operating lease liabilities $ 9,039 |
Variable Interest Entities (Tab
Variable Interest Entities (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Variable Interest Entities | The following table presents the balances related to GS Holdings, inclusive of the Warehouse SPV, that are included in the Unaudited Condensed Consolidated Balance Sheets as of the dates indicated, inclusive of GreenSky, Inc.'s interest in the variable interest entity. March 31, 2021 December 31, 2020 Assets Cash and cash equivalents $ 161,890 $ 116,231 Restricted cash 300,414 319,879 Loan receivables held for sale, net 342,943 571,415 Accounts receivable, net 18,489 21,958 Property, equipment and software, net 21,826 21,452 Other assets 55,223 51,965 Total assets (1) $ 900,785 $ 1,102,900 Liabilities and Members Equity (Deficit) Liabilities Accounts payable $ 31,117 $ 15,418 Accrued compensation and benefits 10,299 13,666 Other accrued expenses 12,115 5,207 Finance charge reversal liability 167,436 185,134 Term loan 452,269 452,806 SPV facility 295,877 502,830.00 Financial guarantee liability 124,217 131,894 Other liabilities 85,061 80,478 Total liabilities (2) 1,178,391 1,387,433 Members Equity (Deficit) Equity (deficit) attributable to Continuing LLC Members (161,614) (169,484) Equity (deficit) attributable to GreenSky, Inc. (115,992) (115,049) Total members equity (deficit) (277,606) (284,533) Total liabilities and members equity (deficit) $ 900,785 $ 1,102,900 (1) Includes $355.5 million and $600.8 million of assets held by the Warehouse SPV as of March 31, 2021 and December 31, 2020, respectively. (2) Includes $296.8 million and $503.9 million of liabilities held by the Warehouse SPV as of March 31, 2021 and December 31, 2020, respectively. The following table reflects the impact of consolidation of GS Holdings, inclusive of the Warehouse SPV, into the Unaudited Condensed Consolidated Statements of Operations for the periods indicated. Three Months Ended March 31, 2021 2020 Total revenue $ 125,172 $ 121,857 Total costs and expenses 105,456 129,649 Operating profit 19,716 (7,792) Total other income (expense), net (5,722) (4,106) Net income (loss) $ 13,994 $ (11,898) The following table reflects the cash flow impact of GS Holdings, inclusive of the Warehouse SPV, on the Unaudited Condensed Consolidated Statements of Cash Flows for the periods indicated. Three Months Ended March 31, 2021 2020 Net cash provided by operating activities $ 245,135 $ 41,047 Net cash used in investing activities (3,452) (3,354) Net cash used in financing activities (215,489) (49,813) Net increase (decrease) in cash and cash equivalents and restricted cash 26,194 (12,120) Cash and cash equivalents and restricted cash at beginning of period 436,110 427,811 Cash and cash equivalents and restricted cash at end of period $ 462,304 $ 415,691 |
Organization, Summary of Sign_4
Organization, Summary of Significant Accounting Policies and New Accounting Standards - Narrative (Details) - USD ($) | 3 Months Ended | |||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | Aug. 24, 2017 | |
Subsidiary, Sale of Stock [Line Items] | ||||
Other gains (losses), net | $ 758,000 | $ 976,000 | ||
Sales, general and administrative | 14,642,000 | 9,929,000 | ||
Interest and dividend income | (137,000) | (622,000) | ||
Interest and other | 4,848,000 | 690,000 | ||
Remaining performance obligations | 0 | |||
Capitalized contract cost | 0 | $ 0 | ||
Volume-based price concessions for merchants and sponsors | 7,500,000 | 5,000,000 | ||
Provision for doubtful accounts | $ 170,000 | 177,000 | ||
Reclassification adjustment | Reclassifications related to formation of Warehouse SPV | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Other gains (losses), net | 2,600,000 | |||
Sales, general and administrative | 2,600,000 | |||
Interest and dividend income | 687,000 | |||
Interest and other | $ 687,000 | |||
GreenSky, LLC | GS Holdings | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Economic interest (as a percent) | 100.00% |
Organization, Summary of Sign_5
Organization, Summary of Significant Accounting Policies and New Accounting Standards - Cash and restricted cash (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Cash and cash equivalents | $ 196,298 | $ 176,707 | ||
Restricted cash | 300,414 | $ 319,879 | 272,966 | |
Cash and cash equivalents and restricted cash in Unaudited Condensed Consolidated Statements of Cash Flows | $ 496,712 | $ 467,654 | $ 449,673 | $ 445,841 |
Organization, Summary of Sign_6
Organization, Summary of Significant Accounting Policies and New Accounting Standards - Revenue disaggregated by type of service (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Disaggregation of Revenue [Line Items] | ||
Interest income | $ 4,847 | $ 687 |
Other | 1 | 3 |
Interest and other | 4,848 | 690 |
Total revenue | 125,172 | 121,857 |
Transaction fees | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 85,657 | 89,884 |
Merchant fees | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 81,159 | 81,415 |
Interchange fees | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 4,498 | 8,469 |
Servicing | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 34,667 | 31,283 |
Increase in servicing assets | $ 7,100 | $ 1,800 |
Earnings per Share (Details)
Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Numerator: | ||
Income (loss) before income tax expense (benefit) | $ 13,997 | $ (11,814) |
Less: Net income (loss) attributable to noncontrolling interests | 8,327 | (7,585) |
Less: Income tax expense (benefit) | 1,872 | (895) |
Net income (loss) attributable to GreenSky, Inc. – basic | 3,798 | (3,334) |
Add: Reallocation of net income attributable to noncontrolling interests from the assumed exchange of Holdco Units for Class A common stock | 8,327 | 0 |
Less: Income tax expense on reallocation of net income attributable to noncontrolling interests | 2,755 | 0 |
Net income (loss) attributable to GreenSky, Inc. – diluted | $ 9,370 | $ (3,334) |
Denominator: | ||
Weighted average shares of Class A common stock outstanding - basic (in shares) | 71,859,110 | 63,650,697 |
Add: Dilutive effects, as shown separately below | ||
Weighted average shares of Class A common stock outstanding - diluted (in shares) | 179,532,426 | 63,650,697 |
Earnings (loss) per share of Class A common stock outstanding - basic (in dollars per share) | $ 0.05 | $ (0.05) |
Earnings (loss) per share of Class A common stock outstanding - diluted (in dollars per share) | $ 0.05 | $ (0.05) |
Effective income tax rate (as a percent) | 13.40% | 7.60% |
Noncontrolling Interest | ||
Add: Dilutive effects, as shown separately below | ||
Effective income tax rate (as a percent) | 33.10% | 21.20% |
HoldCo Units | ||
Add: Dilutive effects, as shown separately below | ||
Holdco Units that are exchangeable for Class A common stock (in shares) | 105,815,474 | 0 |
Class A common stock | ||
Add: Dilutive effects, as shown separately below | ||
Dilutive effect of share based compensation awards (in shares) | 116,401 | 0 |
Excluded from diluted earnings per share, as their inclusion would have been anti-dilutive (in shares) | 2,065,517 | 3,859,794 |
Unvested Class A stock awards | ||
Add: Dilutive effects, as shown separately below | ||
Dilutive effect of share based compensation awards (in shares) | 1,741,441 | 0 |
Excluded from diluted earnings per share, as their inclusion would have been anti-dilutive (in shares) | 2,888,542 | 2,405,122 |
Holdco Units | ||
Add: Dilutive effects, as shown separately below | ||
Excluded from diluted earnings per share, as their inclusion would have been anti-dilutive (in shares) | 241,439 | 113,301,368 |
Fair Value of Assets and Liab_3
Fair Value of Assets and Liabilities - Carrying amounts and estimated fair values of assets and liabilities measured at fair value on a recurring or nonrecurring basis (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Assets: | ||
Cash and cash equivalents | $ 196,298 | $ 147,775 |
Liabilities: | ||
Finance charge reversal liability | 167,436 | 185,134 |
Interest rate swap | 12,116 | 14,182 |
Sales facilitation obligations | 19,264 | 10,655 |
Carrying Value | Measured at fair value on a nonrecurring basis | Level 1 | ||
Assets: | ||
Cash and cash equivalents | 196,298 | 147,775 |
Carrying Value | Measured at fair value on a recurring basis | Level 2 | ||
Assets: | ||
Loan receivables held for sale, net | 342,943 | 571,415 |
Interest rate cap | 251 | 0 |
Liabilities: | ||
Term loan | 452,269 | 452,806 |
Interest rate swap | 12,116 | 14,182 |
Sales facilitation obligations | 19,264 | 10,655 |
Carrying Value | Measured at fair value on a recurring basis | Level 3 | ||
Assets: | ||
Servicing assets | 37,944 | 30,804 |
Contingent consideration receivable | 1,811 | 0 |
Liabilities: | ||
Finance charge reversal liability | 167,436 | 185,134 |
Servicing liability | 1,619 | 1,984 |
Fair Value | Measured at fair value on a nonrecurring basis | Level 1 | ||
Assets: | ||
Cash and cash equivalents | 196,298 | 147,775 |
Fair Value | Measured at fair value on a recurring basis | Level 2 | ||
Assets: | ||
Loan receivables held for sale, net | 345,720 | 575,279 |
Interest rate cap | 251 | 0 |
Liabilities: | ||
Term loan | 450,798 | 452,408 |
Interest rate swap | 12,116 | 14,182 |
Sales facilitation obligations | 19,264 | 10,655 |
Fair Value | Measured at fair value on a recurring basis | Level 3 | ||
Assets: | ||
Servicing assets | 37,944 | 30,804 |
Contingent consideration receivable | 1,811 | 0 |
Liabilities: | ||
Finance charge reversal liability | 167,436 | 185,134 |
Servicing liability | $ 1,619 | $ 1,984 |
Fair Value of Assets and Liab_4
Fair Value of Assets and Liabilities - Narrative (Details) - USD ($) | 1 Months Ended | 3 Months Ended | |||
Jun. 30, 2019 | Mar. 31, 2021 | Mar. 31, 2020 | Jan. 31, 2021 | Dec. 31, 2020 | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||||
Servicing fees | $ 27,500,000 | $ 29,500,000 | |||
Period after which collection efforts will cease | 5 years | ||||
Sales facilitation obligations | $ 19,264,000 | $ 10,655,000 | |||
Change in fair value | 8,600,000 | $ 0 | |||
Level 2 | Fair Value | Measured at fair value on a recurring basis | |||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||||
Sales facilitation obligations | 19,264,000 | $ 10,655,000 | |||
Interest rate swap | Cash Flow Hedging | |||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||||
Notional amount | $ 350,000,000 | $ 350,000,000 | |||
Fixed interest rate | 1.80% | ||||
Derivative contract term | 4 years | ||||
Warehouse SPV | Interest rate cap | |||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||||
Notional amount | $ 555,000,000 | ||||
Fixed interest rate | 2.50% | 2.50% |
Fair Value of Assets and Liab_5
Fair Value of Assets and Liabilities - Servicing assets (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Servicing Assets at Fair Value [Line Items] | ||
Beginning balance | $ 30,804 | |
Ending balance | 37,944 | |
Bank Partner loans | ||
Servicing Assets at Fair Value [Line Items] | ||
Beginning balance | 30,804 | $ 30,459 |
Additions | 11,347 | 2,098 |
Changes in fair value | (4,207) | (309) |
Ending balance | 37,944 | $ 32,248 |
Contingent Consideration Receivables | ||
Servicing Assets at Fair Value [Line Items] | ||
Beginning balance | 0 | |
Additions | 1,811 | |
Receipts | 0 | |
Changes in fair value | 0 | |
Ending balance | $ 1,811 |
Fair Value of Assets and Liab_6
Fair Value of Assets and Liabilities - Servicing liabilities (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Servicing Liability at Fair Value, Amount | ||
Beginning balance | $ 1,984 | $ 3,796 |
Changes in fair value | (365) | (517) |
Ending balance | $ 1,619 | $ 3,279 |
Fair Value of Assets and Liab_7
Fair Value of Assets and Liabilities - Unobservable inputs (Details) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
Servicing Assets at Fair Value [Line Items] | ||
Discount rate | 18.00% | 18.00% |
Minimum | ||
Servicing Assets at Fair Value [Line Items] | ||
Cost of servicing (basis points) | 0.625% | 0.575% |
Weighted average remaining life (years) | 2 years 7 months 6 days | 2 years 3 months 18 days |
Recovery period (years) | 1 year 3 months 18 days | 1 year 7 months 6 days |
Maximum | ||
Servicing Assets at Fair Value [Line Items] | ||
Cost of servicing (basis points) | 1.00% | 10800.00% |
Weighted average remaining life (years) | 5 years 9 months 18 days | 5 years 9 months 18 days |
Recovery period (years) | 3 years 8 months 12 days | 3 years 10 months 24 days |
Weighted Average [Member] | ||
Servicing Assets at Fair Value [Line Items] | ||
Cost of servicing (basis points) | 0.86% | 0.95% |
Discount rate | 18.00% | 18.00% |
Weighted average remaining life (years) | 2 years 7 months 6 days | 2 years 3 months 18 days |
Recovery period (years) | 2 years 10 months 24 days | 3 years 1 month 6 days |
Fair Value of Assets and Liab_8
Fair Value of Assets and Liabilities - Reconciliation of the beginning and ending fair value measurements of FCR Liability (Details) - Finance charge reversals - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation | ||
Beginning balance | $ 185,134 | $ 206,035 |
Receipts | 51,266 | 44,708 |
Settlements | (95,381) | (90,089) |
Fair value changes recognized in cost of revenue | 26,417 | 52,504 |
Ending balance | 167,436 | 213,158 |
Billed finance charges not yet | 95,381 | $ 90,089 |
Warehouse SPV | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation | ||
Settlements | (2,600) | |
Billed finance charges not yet | $ 2,600 |
Fair Value of Assets and Liab_9
Fair Value of Assets and Liabilities - Significant unobservable inputs used to value Level 3 FCR liability (Details) | Mar. 31, 2021 | Dec. 31, 2020 |
Discount rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Inputs used to value the Level 3 FCR liability | 0.035 | 0.035 |
Minimum | Reversal rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Inputs used to value the Level 3 FCR liability | 0.648 | 0.648 |
Maximum | Reversal rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Inputs used to value the Level 3 FCR liability | 1 | 1 |
Weighted average | Reversal rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Inputs used to value the Level 3 FCR liability | 0.899 | 0.892 |
Weighted average | Discount rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Inputs used to value the Level 3 FCR liability | 0.035 | 0.035 |
Loan Receivables Held for Sal_2
Loan Receivables Held for Sale - Activity in the balance of loan receivables held for sale (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Loans Receivable Held-for-sale, Net, Reconciliation to Cash Flow | ||
Beginning balance | $ 571,415 | $ 51,926 |
Additions | 225,209 | 1,071 |
Proceeds from sales and borrower payments | (446,416) | (29,035) |
Loss on sale | (3,371) | 0 |
Decrease (increase) in valuation allowance | (2,244) | 288 |
Transfers | 872 | 56 |
Write-offs and other | (2,522) | (3,247) |
Ending balance | 342,943 | 21,059 |
Mark to market adjustment on loan receivables held for sale | 3,466 | 0 |
Valuation allowance | 1,100 | |
Recovery payments received | 137 | $ 55 |
Warehouse SPV | ||
Loans Receivable Held-for-sale, Net, Reconciliation to Cash Flow | ||
Additions | 209,500 | |
Mark to market adjustment on loan receivables held for sale | (3,500) | |
All other loan receivables held for sale | ||
Loans Receivable Held-for-sale, Net, Reconciliation to Cash Flow | ||
Mark to market adjustment on loan receivables held for sale | $ 135 |
Accounts Receivable - Activity
Accounts Receivable - Activity in balance of loan receivables held for sale (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accounts Receivable, Gross | $ 18,920 | $ 22,271 |
Allowance for Uncollectible Amounts | (431) | (313) |
Accounts Receivable, Net | 18,489 | 21,958 |
Transaction related | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accounts Receivable, Gross | 8,150 | 10,533 |
Allowance for Uncollectible Amounts | (431) | (313) |
Accounts Receivable, Net | 7,719 | 10,220 |
Servicing related | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accounts Receivable, Gross | 10,770 | 11,738 |
Allowance for Uncollectible Amounts | 0 | 0 |
Accounts Receivable, Net | $ 10,770 | $ 11,738 |
Accounts Receivable - Summary o
Accounts Receivable - Summary of balance of allowance for uncollectible amounts (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Contract with Customer, Asset, Allowance for Credit Loss [Roll Forward] | ||
Beginning balance | $ (313) | |
Provision for expected losses | (170) | $ (177) |
Write-offs | 52 | |
Recoveries | 0 | |
Ending balance | $ (431) |
Property, Equipment and Softw_3
Property, Equipment and Software (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Property, Plant and Equipment [Line Items] | ||
Total property, equipment and software, at cost | $ 41,582 | $ 40,410 |
Less: accumulated depreciation | (5,092) | (6,580) |
Less: accumulated amortization | (14,664) | (12,378) |
Total property, equipment and software, net | 21,826 | 21,452 |
Furniture | ||
Property, Plant and Equipment [Line Items] | ||
Total property, equipment and software, at cost | 1,592 | 2,680 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Total property, equipment and software, at cost | 3,604 | 4,399 |
Computer hardware | ||
Property, Plant and Equipment [Line Items] | ||
Total property, equipment and software, at cost | 2,522 | 2,690 |
Software | ||
Property, Plant and Equipment [Line Items] | ||
Total property, equipment and software, at cost | $ 33,864 | $ 30,641 |
Borrowings - Narrative (Details
Borrowings - Narrative (Details) | 1 Months Ended | 3 Months Ended | ||||||||
Jun. 30, 2020USD ($) | May 31, 2020USD ($) | Mar. 31, 2018USD ($) | Mar. 31, 2021USD ($) | Mar. 31, 2020USD ($) | Jan. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Dec. 18, 2020USD ($) | Jun. 30, 2019USD ($) | Aug. 31, 2017USD ($) | |
Debt Instrument [Line Items] | ||||||||||
Borrowings under the credit facility | $ 295,877,000 | $ 502,830,000 | ||||||||
Amortization of debt related costs | 847,000 | $ 416,000 | ||||||||
Interest rate swap | Cash Flow Hedging | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Notional amount | 350,000,000 | $ 350,000,000 | ||||||||
Interest rate cap | Warehouse SPV | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Notional amount | $ 555,000,000 | |||||||||
Term loan | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Amortization of debt related costs | 341,000 | 263,000 | ||||||||
Revolving credit facility | Warehouse SPV | Warehouse Credit Agreement | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Borrowings under the credit facility | $ 295,900,000 | |||||||||
Third party costs | $ 1,000,000 | |||||||||
Additional financing | $ 200,000,000 | |||||||||
Funding period | 1 year | |||||||||
Upfront fee percent | 0.15% | |||||||||
Upfront fees | $ 1,600,000 | |||||||||
Revolving credit facility | 3 month LIBOR | Warehouse SPV | Warehouse Credit Agreement | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Margin (as a percent) | 0.50% | |||||||||
Revolving credit facility | Commercial paper conduit funding rate | Warehouse SPV | Warehouse Credit Agreement | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Margin (as a percent) | 2.50% | |||||||||
Credit Agreement | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Maximum borrowing capacity | $ 450,000,000 | |||||||||
Original term loan | Term loan | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument, face amount | 350,000,000 | |||||||||
Original revolving credit facility | Revolving credit facility | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Maximum borrowing capacity | $ 100,000,000 | |||||||||
Threshold first lien net leverage ratio | 1.50 | |||||||||
Reduced interest margin (as a percent) | 0.375% | |||||||||
Commitment fees within interest expense | $ 125,000 | $ 106,000 | ||||||||
Original revolving credit facility | Letter of credit | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Maximum borrowing capacity | 10,000,000 | |||||||||
Borrowings under the credit facility | $ 0 | |||||||||
Commitment fee percentage | 0.50% | |||||||||
Modified term loan | ||||||||||
Debt Instrument [Line Items] | ||||||||||
First lien net leverage ratio for any measurement date at which the principal amounts of outstanding revolving loans and letters of credit exceed 25% of the aggregate principal amount of the revolving loan facility | 0.0350 | |||||||||
Modified term loan | Term loan | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument, face amount | $ 400,000,000 | |||||||||
Modified revolving credit facility | Revolving credit facility | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Borrowings under the credit facility | $ 0 | $ 0 | ||||||||
Modified revolving credit facility | Revolving credit facility | Base rate loans | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Margin (as a percent) | 2.00% | |||||||||
Reduced interest margin (as a percent) | 2.25% | |||||||||
Modified revolving credit facility | Revolving credit facility | LIBOR | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Margin (as a percent) | 3.00% | |||||||||
Reduced interest margin (as a percent) | 3.25% | |||||||||
2020 Amended Credit Agreement | Term loan | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument, face amount | $ 75,000,000 | |||||||||
Unamortized discount | 3,000,000 | |||||||||
Third party costs | 1,500,000 | |||||||||
Proceeds issuance | $ 70,500,000 | |||||||||
2020 Amended Credit Agreement | Term loan | LIBOR | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Margin (as a percent) | 4.50% | |||||||||
2020 Amended Credit Agreement | Term loan | LIBOR floor | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Margin (as a percent) | 1.00% | |||||||||
Amended Warehouse Facility | Revolving credit facility | Warehouse SPV | Warehouse Credit Agreement | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Maximum borrowing capacity | $ 300,000,000 | 555,000,000 | ||||||||
Amortization of debt related costs | $ 196,000 | |||||||||
Class A commitment | Revolving credit facility | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Maximum borrowing capacity | 500,000,000 | |||||||||
Class B commitment | Revolving credit facility | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Maximum borrowing capacity | $ 55,000,000 |
Borrowings - Schedule of term l
Borrowings - Schedule of term loans (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Debt Instrument [Line Items] | |||
Term loan, face value | $ 462,438 | $ 463,625 | |
Unamortized debt discount | (4,843) | (5,153) | |
Unamortized debt issuance costs | (5,325) | (5,666) | |
Term loan | 452,270 | $ 452,806 | |
Amortization of debt related costs | 847 | $ 416 | |
Term loan | |||
Debt Instrument [Line Items] | |||
Amortization of debt discount | 310 | 153 | |
Amortization of debt related costs | $ 341 | $ 263 | |
Term loan | Original term loan | |||
Debt Instrument [Line Items] | |||
Quarterly amortization rate | 0.25% |
Derivative Instruments - Narrat
Derivative Instruments - Narrative (Details) - USD ($) | 1 Months Ended | ||
Jun. 30, 2019 | Mar. 31, 2021 | Jan. 31, 2021 | |
Derivative [Line Items] | |||
Cash flow hedge gain (loss) to be reclassified within twelve months | $ 5,800,000 | ||
Interest rate cap | Warehouse SPV | |||
Derivative [Line Items] | |||
Notional amount | $ 555,000,000 | ||
Fixed interest rate | 2.50% | 2.50% | |
Cash Flow Hedging | Interest rate swap | |||
Derivative [Line Items] | |||
Notional amount | $ 350,000,000 | $ 350,000,000 | |
Derivative contract term | 4 years | ||
Fixed interest rate | 1.80% |
Derivative Instruments - Schedu
Derivative Instruments - Schedule of notional amounts of outstanding derivative positions (Details) - Interest rate swap - Cash Flow Hedging - USD ($) | Mar. 31, 2021 | Jun. 30, 2019 |
Derivative [Line Items] | ||
Notional Amount | $ 350,000,000 | $ 350,000,000 |
Fixed Interest Rate | 1.80% |
Derivative Instruments - Deriva
Derivative Instruments - Derivative Instruments on our Unaudited Condensed Consolidated Financial Statements (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Derivative liability | $ 12,116 | $ 14,182 | |
Interest rate swap | Designated as cash flow hedges | Interest expense | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Interest rate swap – gain (loss) reclassified into interest expense | (1,468) | $ (107) | |
Interest rate swap | Designated as cash flow hedges | Income tax expense | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Interest rate swap – gain (loss) reclassified into income tax expense | 145 | 9 | |
Interest rate swap | Designated as cash flow hedges | Other liabilities | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Derivative liability | 12,116 | 14,182 | |
FCR liability | Not designated as hedges | Cost of revenue | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Change in fair value recorded in cost of revenue | 26,417 | 52,504 | |
FCR liability | Not designated as hedges | Finance charge reversal liability | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Derivative liability | 167,436 | 185,134 | |
Sales facilitation obligations | Not designated as hedges | Cost of revenue | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Change in fair value recorded in cost of revenue | 8,609 | 0 | |
Sales facilitation obligations | Not designated as hedges | Other liabilities | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Derivative liability | 19,264 | 10,655 | |
Interest rate cap | Not designated as hedges | Cost of revenue | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Change in fair value recorded in cost of revenue | 251 | $ 0 | |
Interest rate cap | Not designated as hedges | Other assets | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Derivative liability | $ 251 | $ 0 |
Derivative Instruments - Change
Derivative Instruments - Changes in Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||
Net tax benefit | $ 145 | $ 9 |
Accumulated Other Comprehensive Income (Loss) | ||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||
Accumulated other comprehensive income (loss), beginning balance | (4,340) | (756) |
Accumulated other comprehensive income (loss), ending balance | (3,712) | (4,294) |
Cash Flow Hedge | ||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||
Other comprehensive income (loss) before reclassifications and tax | 234 | (4,706) |
Tax (expense) benefit | (54) | 1,139 |
Other comprehensive income (loss) before reclassifications, net of tax | 180 | (3,567) |
Reclassifications out of accumulated other comprehensive income (loss), net of tax | 448 | 29 |
Net (increase) decrease in other comprehensive loss | $ 628 | $ (3,538) |
Other Assets and Liabilities -
Other Assets and Liabilities - Other assets (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Other Liabilities Disclosure [Abstract] | ||
Servicing assets | $ 37,944 | $ 30,804 |
Right-of-use assets | 7,375 | 8,265 |
Prepaid expenses | 6,015 | 8,860 |
Related party receivables | 84 | 88 |
Insurance recoveries | 26,900 | 0 |
Other receivables and assets | 10,015 | 4,626 |
Other assets | 88,333 | $ 52,643 |
Capitalized implementation costs | 1,100 | |
Amortization expense | 50 | |
Accumulated amortization | $ 59 |
Other Assets and Liabilities _2
Other Assets and Liabilities - Other liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Other Liabilities Disclosure [Abstract] | ||||
Transaction processing liabilities | $ 31,594 | $ 30,169 | ||
Servicing liabilities | 1,619 | 1,984 | $ 3,279 | $ 3,796 |
Distributions payable | 1,995 | 3,136 | ||
Interest rate swap | 12,116 | 14,182 | ||
Tax related liabilities | 667 | 691 | ||
Deferred lease liabilities | 9,039 | 10,107 | ||
Legal settlement accrual | 27,500 | 0 | ||
Accruals and other liabilities | 8,835 | 10,245 | ||
Sales facilitation obligations(5) | 19,264 | 10,655 | ||
Other liabilities | $ 112,629 | $ 81,169 | ||
Operating Lease, Liability, Statement of Financial Position [Extensible List] | Other liabilities | Other liabilities | Other liabilities |
Noncontrolling Interests (Detai
Noncontrolling Interests (Details) | 3 Months Ended | ||
Mar. 31, 2021shares | Mar. 31, 2020 | Dec. 31, 2020 | |
Noncontrolling Interest [Line Items] | |||
Weight average ownership percentage by parent | 40.50% | 36.20% | |
GS Holdings | |||
Noncontrolling Interest [Line Items] | |||
Economic interest (as a percent) | 42.50% | 42.00% | |
Exchange of Holdco Units for Class A common stock pursuant to the Exchange Agreement | |||
Noncontrolling Interest [Line Items] | |||
Exchange ratio | 1 | ||
Units converted (in shares) | 100,000 | ||
Exchange of Holdco Units for Class A common stock pursuant to the Exchange Agreement | Class A common stock | |||
Noncontrolling Interest [Line Items] | |||
Effect of Reorganization Transactions (in shares) | 100,000 | ||
Exchange of Holdco Units for Class A common stock pursuant to the Exchange Agreement | Class A restricted stock awards | |||
Noncontrolling Interest [Line Items] | |||
Issuance of unvested Class A common stock awards (in shares) | 2,000,000 |
Stockholders Equity (Deficit) -
Stockholders Equity (Deficit) - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Class of Stock [Line Items] | ||
Treasury stock (in shares) | 15,055,886 | |
Treasury stock, shares acquired (in shares) | 13,425,688 | |
Treasury stock, acquired | $ 146.1 | |
Treasury stock reissued (in shares) | 0 | 0 |
Treasury stock | Restricted stock awards | ||
Class of Stock [Line Items] | ||
Unvested stock forfeited and held in treasury (in shares) | 1,300,764 | |
Restricted Stock, shares issued net of shares for tax withholdings (in shares) | 329,434 |
Stockholders Equity (Deficit)_2
Stockholders Equity (Deficit) - Distributions (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | ||
May 31, 2018 | Dec. 31, 2017 | Mar. 31, 2021 | Mar. 31, 2020 | |
Dividends Payable [Line Items] | ||||
Payment of tax distributions | $ 3,388 | $ 31,136 | ||
Remaining reserved payment | 1,995 | 4,317 | ||
Credit Agreement Distribution | ||||
Dividends Payable [Line Items] | ||||
Payments of distributions | 769 | 1,129 | ||
Remaining reserved payment | 1,295 | |||
Special Operating Distribution | ||||
Dividends Payable [Line Items] | ||||
Payments of distributions | 372 | 533 | ||
Remaining reserved payment | 700 | |||
Distributions | $ 26,200 | $ 160,000 | ||
Tax and Non-Tax Distributions Gross | ||||
Dividends Payable [Line Items] | ||||
Total | 4,529 | $ 32,798 | ||
Remaining reserved payment | $ 1,995 |
Share-Based Compensation - Narr
Share-Based Compensation - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Allocated share-based compensation expense | $ 3,700 | $ 3,500 |
Unvested Class A stock awards | Director | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period | 1 year | |
Unvested Class A stock awards | Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period | 3 years | |
Unvested Class A stock awards | Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period | 4 years | |
Compensation and benefits expense | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Allocated share-based compensation expense | $ 3,300 | 3,200 |
Cost of revenue | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Allocated share-based compensation expense | $ 387 | $ 270 |
Share-Based Compensation - Clas
Share-Based Compensation - Class A common stock options (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||
Payment of option taxes | $ 0 | $ 73 |
Class A common stock | ||
Number of Options | ||
Outstanding at beginning of period (in shares) | 3,862,926 | 4,181,909 |
Granted (in shares) | 0 | 0 |
Exercised (in shares) | (104,833) | (105,000) |
Forfeited (in shares) | (437,698) | (201,615) |
Expired (in shares) | (217,476) | (15,500) |
Outstanding at end of period (in shares) | 3,102,919 | 3,859,794 |
Exercisable at end of period (in shares) | 1,351,989 | 1,543,292 |
Weighted Average Exercise Price | ||
Outstanding at beginning of period (in dollars per share) | $ 9.70 | |
Granted (in dollars per share) | 0 | |
Exercised (in dollars per share) | 5.65 | |
Forfeited (in dollars per share) | 7.85 | |
Expired (in dollars per share) | 12.23 | |
Outstanding at end of period (in dollars per share) | 9.93 | |
Exercisable at end of period (in dollars per share) | $ 11.10 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||
Exercises in period, intrinsic value | $ 145 | $ 205 |
Class A common stock option exercises (in shares) | 104,833 | 105,000 |
Shares exercised by means of cashless net exercise procedure (in shares) | 100,000 | 105,000 |
Issuance of shares related to cashless option exercises (in shares) | 13,891 | |
Payment of option taxes | $ 42 | $ 73 |
Shares exercised by means of cashless net exercise procedure (in shares) | 15,051 | |
Class A common stock | Employees | ||
Number of Options | ||
Exercised (in shares) | (4,833) | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||
Proceeds from issuance of shares | $ 27 | |
Class A common stock option exercises (in shares) | 4,833 |
Share-Based Compensation - Intr
Share-Based Compensation - Intrinsic value (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Aggregate intrinsic value (in thousands) | ||
Options outstanding | $ 2,264 | |
Options exercisable | $ 229 | |
Weighted average remaining term (in years) | ||
Options outstanding | 7 years 4 months 24 days | |
Options exercisable | 6 years 3 months 18 days | |
Options, vested in period, fair value | $ 1,200 | $ 1,500 |
Share-Based Compensation - Unve
Share-Based Compensation - Unvested HoldCo Units, Class A common stock awards, and RSAs (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Unvested HoldCo Units | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||
Unvested at beginning of period (in shares) | 489,486 | 1,112,607 |
Forfeited (in shares) | 0 | 0 |
Vested (in shares) | (93,800) | (134,582) |
Unvested at period end (in shares) | 395,686 | 978,025 |
Weighted Average Grant Date Fair Value | ||
Unvested at beginning of period (in dollars per share) | $ 23 | |
Forfeited (in dollars per share) | 23 | |
Vested (in dollars per share) | 23 | |
Unvested at period end (in dollars per share) | $ 23 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Additional Disclosures [Abstract] | ||
Vested in period, fair value | $ 2.2 | $ 3.1 |
Unvested Class A stock awards | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||
Unvested at beginning of period (in shares) | 4,956,922 | 2,999,343 |
Granted (in shares) | 2,019,240 | 0 |
Forfeited (in shares) | (380,786) | (181,794) |
Vested (in shares) | (302,493) | (412,427) |
Unvested at period end (in shares) | 6,292,883 | 2,405,122 |
Weighted Average Grant Date Fair Value | ||
Unvested at beginning of period (in dollars per share) | $ 6.53 | |
Granted (in dollars per share) | 6.77 | |
Forfeited (in dollars per share) | 6.81 | |
Vested (in dollars per share) | 13.19 | |
Unvested at period end (in dollars per share) | $ 6.27 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Additional Disclosures [Abstract] | ||
Vested in period, fair value | $ 4 | $ 5.4 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |||
Effective tax rate (as a percent) | 13.40% | 7.60% | |
Income tax expense (benefit) | $ 1,872 | $ (895) | |
Federal and state statutory rate | 24.40% | 24.30% | |
Unrecognized tax benefits | $ 98 | $ 98 | |
Deferred tax assets, net | 386,116 | 387,951 | |
Tax receivable agreement liability | $ 310,624 | $ 310,425 |
Commitments, Contingencies an_3
Commitments, Contingencies and Guarantees - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Loss Contingencies [Line Items] | |||
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Other assets | Other assets | |
Operating Lease, Liability, Statement of Financial Position [Extensible List] | Other liabilities | Other liabilities | Other liabilities |
Operating lease, expense | $ 1,000 | $ 1,000 | |
Unused commitments to extend credit | 29,500 | $ 99,900 | |
Restricted cash | 300,414 | 272,966 | 319,879 |
Financial guarantee liability | 124,217 | 131,894 | |
Financial Guarantee | |||
Loss Contingencies [Line Items] | |||
Financial guarantee liability | 124,200 | 131,900 | |
Possible losses as guarantor, maximum | 175,300 | 173,200 | |
Financial guarantee expense (benefit) | (3,883) | $ 18,408 | |
Collectibility of Receivables | |||
Loss Contingencies [Line Items] | |||
Loss contingency accrual | 4,100 | ||
Bank Partners | |||
Loss Contingencies [Line Items] | |||
Financing receivable, nonaccrual status | 11,600 | ||
Contractual Restricted Cash Under Arrangement | |||
Loss Contingencies [Line Items] | |||
Restricted cash | $ 74,500 | $ 84,600 | |
Minimum | |||
Loss Contingencies [Line Items] | |||
Renewal term (in years) | 5 years | ||
Maximum | |||
Loss Contingencies [Line Items] | |||
Renewal term (in years) | 15 years |
Commitments, Contingencies an_4
Commitments, Contingencies and Guarantees - Lease costs (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Commitments and Contingencies Disclosure [Abstract] | ||
Operating lease ROU assets | $ 7,375 | $ 8,265 |
Operating lease liabilities | $ 9,039 | $ 10,107 |
Weighted average remaining lease term (in years) | 2 years 2 months 12 days | 2 years 4 months 24 days |
Weighted average discount rate | 5.80% | 5.80% |
Commitments, Contingencies an_5
Commitments, Contingencies and Guarantees - Future minimum lease payments (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Commitments and Contingencies Disclosure [Abstract] | ||
Remainder of 2021 | $ 3,688 | |
2022 | 3,706 | |
2023 | 1,501 | |
2024 | 810 | |
2025 | 0 | |
Thereafter | 0 | |
Total lease payments | 9,705 | |
Less: imputed interest | (666) | |
Operating lease liabilities | $ 9,039 | $ 10,107 |
Related Party Transactions - Na
Related Party Transactions - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Related Party Transaction [Line Items] | |||
Right-of-use assets | $ 7,375 | $ 8,265 | |
Operating lease liabilities | 9,039 | 10,107 | |
Common Management | |||
Related Party Transaction [Line Items] | |||
Right-of-use assets | 3,500 | 3,900 | |
Operating lease liabilities | 4,100 | $ 4,500 | |
Common Management | Rent expense | |||
Related Party Transaction [Line Items] | |||
Related party expenses | $ 435 | $ 435 |
Segment Reporting (Details)
Segment Reporting (Details) | 3 Months Ended |
Mar. 31, 2021segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 1 |
Variable Interest Entities - Na
Variable Interest Entities - Narrative (Details) | 3 Months Ended |
Mar. 31, 2021 | |
VIE | GS Holdings | |
Variable Interest Entity [Line Items] | |
Ownership percentage | 100.00% |
Variable Interest Entities - Ba
Variable Interest Entities - Balance sheet (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Assets | ||||
Cash and cash equivalents | $ 196,298 | $ 147,775 | ||
Restricted cash | 300,414 | 319,879 | $ 272,966 | |
Loan receivables held for sale, net | 342,943 | 571,415 | 21,059 | $ 51,926 |
Accounts receivable, net | 18,489 | 21,958 | ||
Property, equipment and software, net | 21,826 | 21,452 | ||
Other assets | 88,333 | 52,643 | ||
Total assets | 1,354,419 | 1,523,073 | ||
Liabilities | ||||
Accounts payable | 31,117 | 15,418 | ||
Accrued compensation and benefits | 10,299 | 13,666 | ||
Other accrued expenses | 12,115 | 5,207 | ||
Finance charge reversal liability | 167,436 | 185,134 | ||
Term loan | 452,270 | 452,806 | ||
Warehouse facility | 295,877 | 502,830 | ||
Financial guarantee liability | 124,217 | 131,894 | ||
Other liabilities | 112,629 | 81,169 | ||
Total liabilities | 1,516,583 | 1,698,549 | ||
Equity (Deficit) | ||||
Noncontrolling interests | (161,614) | (169,484) | ||
Total equity (deficit) | (162,164) | (175,476) | $ (213,496) | $ (54,943) |
Total liabilities and equity (deficit) | 1,354,419 | 1,523,073 | ||
GS Holdings | VIE | ||||
Assets | ||||
Cash and cash equivalents | 161,890 | 116,231 | ||
Restricted cash | 300,414 | 319,879 | ||
Loan receivables held for sale, net | 342,943 | 571,415 | ||
Accounts receivable, net | 18,489 | 21,958 | ||
Property, equipment and software, net | 21,826 | 21,452 | ||
Other assets | 55,223 | 51,965 | ||
Total assets | 900,785 | 1,102,900 | ||
Liabilities | ||||
Accounts payable | 31,117 | 15,418 | ||
Accrued compensation and benefits | 10,299 | 13,666 | ||
Other accrued expenses | 12,115 | 5,207 | ||
Finance charge reversal liability | 167,436 | 185,134 | ||
Term loan | 452,269 | 452,806 | ||
Warehouse facility | 295,877 | 502,830 | ||
Financial guarantee liability | 124,217 | 131,894 | ||
Other liabilities | 85,061 | 80,478 | ||
Total liabilities | 1,178,391 | 1,387,433 | ||
Equity (Deficit) | ||||
Noncontrolling interests | (161,614) | (169,484) | ||
Total permanent equity (deficit) | (115,992) | (115,049) | ||
Total equity (deficit) | (277,606) | (284,533) | ||
Total liabilities and equity (deficit) | 900,785 | 1,102,900 | ||
GS Holdings | Warehouse SPV | ||||
Assets | ||||
Total assets | 355,500 | 600,800 | ||
Liabilities | ||||
Total liabilities | $ 296,800 | $ 503,900 |
Variable Interest Entities - St
Variable Interest Entities - Statement of operations (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Variable Interest Entity [Line Items] | ||
Total costs and expenses | $ 105,456 | $ 129,649 |
Operating profit | 19,716 | (7,792) |
Total other income (expense), net | (5,719) | (4,022) |
Income (loss) before income tax expense (benefit) | 13,997 | (11,814) |
VIE | GS Holdings | ||
Variable Interest Entity [Line Items] | ||
Revenues | 125,172 | 121,857 |
Total costs and expenses | 105,456 | 129,649 |
Operating profit | 19,716 | (7,792) |
Total other income (expense), net | (5,722) | (4,106) |
Income (loss) before income tax expense (benefit) | $ 13,994 | $ (11,898) |
Variable Interest Entities - _2
Variable Interest Entities - Statement of cash flow (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Cash flows from operating activities | ||
Net cash provided by operating activities | $ 245,135 | $ 41,047 |
Net cash used in investing activities | (3,452) | (3,354) |
Net cash used in financing activities | (212,625) | (33,861) |
Net increase (decrease) in cash and cash equivalents and restricted cash | 29,058 | 3,832 |
Cash and cash equivalents and restricted cash at beginning of period | 467,654 | 445,841 |
Cash and cash equivalents and restricted cash at end of period | 496,712 | 449,673 |
VIE | GS Holdings | ||
Cash flows from operating activities | ||
Net cash provided by operating activities | 245,135 | 41,047 |
Net cash used in investing activities | (3,452) | (3,354) |
Net cash used in financing activities | (215,489) | (49,813) |
Net increase (decrease) in cash and cash equivalents and restricted cash | 26,194 | (12,120) |
Cash and cash equivalents and restricted cash at beginning of period | 436,110 | 427,811 |
Cash and cash equivalents and restricted cash at end of period | $ 462,304 | $ 415,691 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | 1 Months Ended | 3 Months Ended | ||
May 06, 2021 | Apr. 30, 2021 | Mar. 31, 2021 | Mar. 31, 2020 | |
Subsequent Event [Line Items] | ||||
Proceeds from sales and borrower payments | $ 446,416,000 | $ 29,035,000 | ||
Forward flow commitment | ||||
Subsequent Event [Line Items] | ||||
Maximum forward flow commitment | $ 1,000,000,000 | |||
Loan participations, term | 1 year | |||
Subsequent Event | ||||
Subsequent Event [Line Items] | ||||
Extended commitment term | 2 years | |||
Proceeds from sales and borrower payments | $ 273,000,000 | |||
Subsequent Event | Tax distributions | ||||
Subsequent Event [Line Items] | ||||
Payments of distributions | $ 3,800,000 | |||
Subsequent Event | Tax and Non-Tax Distributions Gross | ||||
Subsequent Event [Line Items] | ||||
Payments of distributions | $ 157,000 | |||
Subsequent Event | Forward flow commitment | ||||
Subsequent Event [Line Items] | ||||
Maximum forward flow commitment | 1,500,000,000 | |||
Increase in commitment | 500,000,000 | |||
Subsequent Event | Revolving credit facility | Existing Bank Partner | ||||
Subsequent Event [Line Items] | ||||
Increase in revolving commitment | 500,000,000 | |||
Maximum borrowing capacity | $ 2,000,000,000 |
Uncategorized Items - gsky-2021
Label | Element | Value |
Accounting Standards Update [Extensible List] | us-gaap_AccountingStandardsUpdateExtensibleList | us-gaap:AccountingStandardsUpdate201613Member |