(1) Defined as Adj. EBITDA, minus CAPEX, plus or minus change in contract assets
2
Well Defined Growth Plan
Near Term
Growth
Strategy
Longer
Term
Growth
Strategy
Expand Core Business
OEM Opportunity
CECL Relief
Refinance Opportunities
Broaden Our Offerings
Launch into New Channels
Drive Loan Volume through Further Wallet-Share Increase and Customer Penetration
Expansion of Lender Base
Increase OEM Captive Penetration by Addressing Broader Credit Spectrum and Deployment of Subvention Capabilities
Enhanced Value Proposition to Lenders Provided via CECL Relief
Increased Profitability for Financial Institutions in Near Prime Auto
Enhanced Focus on Refinance Program to Drive Additional Cert Volume
Ease of Customer Access in Reduced Interaction Environment
Prime Decisioning SaaS Solution
Expansion into Other Consumer Asset Classes
Expansion into Adjacent Asset Classes (e.g., leases)
Establish Broader Auto Platform (e.g., hub and spoke)
3
Understanding Changes in Contract Assets and Profit Share Revenue
In LTM period on a net basis, ~89% of Changes in Contract Asset Estimates Driven by Realized Portfolio
Performance as Opposed to Changes in Prospective Estimates
Change in Contract Asset Estimates and Profit Share Revenue:
($ in millions)
$11.8
$7.5
$7.5
$4.0
$3.8
$1.3
$5.1
$10.5
$1.1
$7.8
$6.2
($0.9)
$5.3
$4.0
($12.0)
$0.7
($1.5)
($1.6)
($3.0)
($12.0)
Lower than projected claims and severity of losses in historical periods drove positive changes to contract asset estimates that in turn drive strong near-termcash flows
Covid Impact
Q1-20
Q2-20
Q3-20
Q4-20
Q1-21
Q2-21
Q3-21
Prospective
Changes in
Assumptions
Realized
Portfolio
Performance
4
Understanding Profit Share Unit Economic Trends
Profit Share Unit Economics Normalized While Achieving Record Cert Volumes
Profit share unit economics normalized as we removed COVID-19 underwriting standards
Removed vehicle value discount in April 2021, which drove ~15% premium increase during pandemic
These underwriting changes resulted in record cert loan volume and expanded our competitive positioning
Closure rates improved after removing COVID-19 underwriting standards
Strategically shifted our channel mix and unit economics remain strong across all channels
Unit level pricing is dependent on risk and Open Lending is constantly evaluating the best risk-adjusted opportunities in the market to deploy Lender's Protection
Refinance channel has grown to nearly 30% of total certs in Q3 and exhibits high quality and predictable credit characteristics; channel remains an attractive avenue for growth
Continued strong loan performance would result in positive changes in contract assets, profit share revenues and cash flows
5
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Open Lending Corporation published this content on 09 November 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 09 November 2021 21:16:10 UTC.
Open Lending Corporation is a provider of lending enablement and risk analytics to credit unions, regional banks, finance companies and the captive finance companies of automakers. The Company provides loan analytics, risk-based pricing, risk modeling and default insurance to auto lenders throughout the United States. It targets the financing needs of near-prime and non-prime borrowers, or borrowers with a credit bureau score generally between 560 and 699. Lenders Protection platform (LPP), the Company's flagship product, is a cloud-based automotive lending platform. LPP supports the full transaction lifecycle, including credit application, underwriting, real-time insurance approval, settlement, servicing, invoicing of insurance premiums and fees and advanced data analytics of the automotive lender's portfolio under the program. Its risk models project loan performance, including expected losses and prepayments, in arriving at the optimal rate. It serves around 454 active lenders.
OPEN LENDING CORPORATION 
