• It's like **Ally Financial** for sub-prime auto loans.
• Think of it as the **Capital One Auto Finance** for car buyers with challenging credit histories.
• It's an **Upstart** or **LendingClub** but focused strictly on car financing for non-traditional borrowers.

• Indirect Automobile Financing: CPSS provides indirect financing by purchasing retail automobile contracts from franchised and independent dealers, enabling customers with limited credit histories to acquire vehicles.
• Direct Automobile Financing: CPSS offers financing directly to sub-prime consumers to facilitate their purchase of new or used automobiles, light trucks, or passenger vans.
• Installment Contract Acquisition: CPSS acquires installment purchase contracts, typically through merger and acquisition transactions, to expand its portfolio.
• Vehicle Loan Acquisition: CPSS purchases vehicle purchase money loans from non-affiliated lenders.
• Automobile Contract Servicing: CPSS manages and services all the automobile contracts it acquires through its branch network across several states.

Consumer Portfolio Services (CPSS) primarily serves individual customers. The company acts as a specialty finance provider, offering indirect financing through automobile dealers and direct financing to consumers who typically cannot obtain loans from traditional lenders.

The categories of individual customers CPSS serves are:

• Individuals with limited credit histories: These are consumers who may not have established a strong credit record, making it challenging for them to secure financing from commercial banks, credit unions, or captive finance companies.
• Individuals with past credit problems: This category includes consumers who have encountered prior credit issues, such as bankruptcies or late payments, which hinder their ability to qualify for conventional auto loans.
• Sub-prime consumers seeking direct financing: Beyond purchasing contracts indirectly through dealers, CPSS also directly offers financing to sub-prime consumers to facilitate their purchase of a new or used automobile, light truck, or passenger van.

Charles E. Bradley, Jr. Chairman of the Board and Chief Executive Officer

Mr. Bradley has served as Chief Executive Officer of Consumer Portfolio Services since January 1992, a director since its formation in March 1991, and was elected Chairman of the Board of Directors in July 2001. He was also President of the company from March 1991 to December 2022. Prior to his tenure at Consumer Portfolio Services, he held the position of Chief Operating Officer at Barnard and Company, a private investment firm, from April 1989 to November 1990. From September 1987 to March 1989, he worked as an associate of The Harding Group, a private investment banking firm.

Danny Bharwani Executive Vice President, Chief Financial Officer

Mr. Bharwani has served as Chief Financial Officer since September 2022 and Executive Vice President – Finance since December 2022. He previously held the roles of Senior Vice President – Accounting from April 2016 and Vice President – Accounting from June 2002. Mr. Bharwani joined Consumer Portfolio Services as Assistant Controller in August 1997. Before joining the company, he was employed as Assistant Controller at The Todd-AO Corporation from 1989 to 1997.

Michael T. Lavin President, Chief Operating Officer and Chief Legal Officer

Mr. Lavin has been President of Consumer Portfolio Services since December 2022. Prior to this, he served as Executive Vice President, Chief Legal Officer and Chief Operating Officer from March 2019. His previous roles include Executive Vice President and Chief Legal Officer since March 2014, Senior Vice President - General Counsel since March 2013, and Senior Vice President and Corporate Counsel since May 2009. Mr. Lavin initially joined the company as Vice President - Legal in November 2001. He oversees several departments, including Sales, Originations, Servicing, Risk, Systems, IT, Human Resources, Legal, and Investor Relations.

Teri L. Robinson Executive Vice President of Sales & Originations

Ms. Robinson serves as the Executive Vice President of Sales & Originations. No further detailed background information is available.

Christopher Terry Executive Vice President - Systems, Risk and IT

Mr. Terry holds the position of Executive Vice President - Systems, Risk and IT. No further detailed background information is available.

Key Risks to Consumer Portfolio Services (CPSS)

Consumer Portfolio Services (CPSS), a specialty finance company focused on the sub-prime auto lending market, faces several significant risks inherent to its business model and the broader economic environment.

1. Elevated Credit Risk and Deteriorating Asset Quality: CPSS's core business involves purchasing and servicing retail automobile contracts from sub-prime borrowers, who typically have limited credit histories or past credit problems. This customer segment is highly susceptible to economic downturns, rising unemployment, and inflationary pressures, leading to an inherently higher risk of loan defaults and delinquencies. Recent data indicates a worsening trend in credit quality, with annualized net charge-offs reaching 8.01% in Q3 2025, up from 7.32% in Q3 2024. Delinquency rates have also remained persistently high, with total delinquencies at 13.96% in Q3 2025 and nearly 7% of sub-prime auto borrowers at least 60 days behind in payments as of March 2025. Furthermore, consumer bankruptcy filings have shown an accelerating trend, rising 23.5% year-to-date in 2025 over 2024, directly impacting the recoverability of loans.
2. Interest Rate Sensitivity and Funding Costs: As a finance company, CPSS relies heavily on securitization—packaging pools of loans into asset-backed securities (ABS)—to fund its loan originations and operations. Sustained high interest rates significantly increase the cost of these funding mechanisms, directly compressing the company's net interest margin (NIM) on its sub-prime auto receivables. Any substantial increase in coupon rates on new asset-backed notes could tighten liquidity and negatively impact profitability. Rising interest rates also make it more challenging for investors and loan originators to absorb losses from deteriorating asset-backed securities, further squeezing sub-prime auto lenders.
3. Regulatory Scrutiny and Compliance Costs: The auto finance industry, particularly the sub-prime segment, is subject to extensive regulation at both state and federal levels. Changes in these regulations, which often aim to protect consumers or mitigate overall market risk, could lead to increased compliance costs, restrict lending practices, or limit growth opportunities for CPSS.

Consumer Portfolio Services (CPSS) anticipates several key drivers of future revenue growth over the next two to three years:

1. Growth in Loan Originations and Receivables Portfolio: The company expects substantial growth in its receivables portfolio, which is the primary driver of interest income. Management aims to increase the portfolio significantly in the coming years by focusing on expanding its loan originations. This growth will be fueled by efforts such as hiring new sales representatives, expanding into new territories, and increasing the number of active dealers in its funding pool.
2. Expanded Funding Capacity and Strategic Financing: New financing opportunities are expected to be instrumental for growth. Consumer Portfolio Services recently secured a new $150 million warehouse line with Capital One and a $900 million prime forward flow commitment with a credit union partner. These expanded funding lines will provide the necessary capital to support increased contract purchases and portfolio expansion in 2026 and beyond.
3. Improved Credit Quality and Portfolio Performance: While not a direct revenue driver, improvements in credit quality are expected to enhance overall profitability and net interest margin, thereby positively impacting net revenue. The company anticipates that problematic loan vintages from 2022 and 2023, which have historically weighed on performance, will become "de minimis by the end of '26," leading to better recovery rates and loss performance in newer originations.
4. Increased Application Volume and Dealer Engagement: A strategic focus for the company is to increase its monthly application volume from 250,000 to 325,000. This, coupled with efforts to add more active dealers to its funding network, is designed to expand the customer base and drive a higher volume of new contract purchases, directly contributing to revenue growth.
5. Enhanced Operational Efficiency and Credit Scoring Model: The implementation of a new credit scoring model has already led to an 11% increase in approvals and an 8.4% rise in total fundings. These operational efficiencies and improved underwriting processes are expected to strengthen the company's credit operations and drive future business expansion by converting more applications into funded contracts.

Share Repurchases

• Consumer Portfolio Services made approximately $58.08 million in share repurchases between Q1 2021 and Q3 2025.
• The number of outstanding shares decreased by 1.08% in the last year.

Share Issuance

• The number of outstanding shares increased due to the exercise of stock options as part of the company's employee long-term incentive plan.
• Between December 31, 2024, and September 30, 2025, the number of issued and outstanding shares increased by approximately 711,010.
• Shareholders approved the 2025 Equity Incentive Plan, authorizing up to 4,501,330 shares of common stock for various awards.

Capital Expenditures

• Capital expenditures were -$721,000 in the last 12 months.