SANTANDER CONSUMER USA HOLDINGS INC. (Exact name of registrant as specified in its charter)

Transcription

1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): January 25, 2017 SANTANDER CONSUMER USA HOLDINGS INC. (Exact name of registrant as specified in its charter) Delaware (State or other Jurisdiction of Incorporation) (Commission File Number) (IRS Employer Identification No.) 1601 Elm St. Suite #800 Dallas, Texas (Address of Principal Executive Offices) (Zip Code) Registrant s telephone number, including area code: (214) n/a (Former name or former address if changed since last report.) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: Written communications pursuant to Rule 425 under the Securities Act (17 CFR ) Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR a-12) Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR d-2(b)) Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR e-4(c))

2 Item Results of Operations and Financial Condition. On January 25, 2017, Santander Consumer USA Holdings Inc. (the Company ) issued a press release announcing its financial results for the quarter ended December 31, Copies of the Company s press release and an investor presentation for the quarter ended December 31, 2016 are attached hereto as Exhibits 99.1 and 99.2, respectively, and incorporated herein by reference. Note : Information in this report (including Exhibits 99.1 and 99.2) furnished pursuant to Item 2.02 shall not be deemed to be filed for the purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section. Item Financial Statements and Exhibits. Exhibit No. Description Exhibit 99.1 Press Release of Santander Consumer USA Holdings Inc., dated January 25, Exhibit 99.2 Presentation Materials of Santander Consumer USA Holdings Inc., dated January 25,

3 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. SANTANDER CONSUMER USA HOLDINGS INC. Dated: January 25, 2017 By: /s/ Jason A. Kulas Name: Jason A. Kulas Title: President & Chief Executive Officer

4 Exhibit 99.1 Contacts: Investor Relations Evan Black Media Relations Laurie Kight Santander Consumer USA Holdings Inc. Reports Fourth Quarter and Full Year 2016 Results Dallas, TX (January 25, 2017) Santander Consumer USA Holdings Inc. (NYSE: SC) ( SC ) today announced net income for the fourth quarter 2016 of $61 million, or $0.17 cents per diluted common share. Full year 2016 net income was $766 million, or $2.13 cents per diluted common share. Fourth Quarter 2016 Key Highlights (variancescomparedtofourthquarter2015): Total auto originations of $4.5 billion, down 24% Core retail auto originations of $2.0 billion, up 1% Total Chrysler Capital originations of $2.5 billion, down 36% Total finance and other interest income of $1.6 billion, up 4% Net finance and other interest income of $1.1 billion, down 5% Common equity tier 1 (CET1) ratio of 13.4%, up 220 basis points Issued $3.3 billion in securitizations Full Year 2016 Key Highlights ( variancescomparedtofullyear2015): Total auto originations of $21.9 billion, down 20% Interest on individually acquired retail installment contracts of $4.6 billion, up 3% Net finance and other interest income of $4.7 billion, flat Expense ratio of 2.2%, up 10 basis points Return on average assets of 2.0% Return on average equity of 15.8% Average managed assets of $52.7 billion, up 8% Retail installment contract ("RIC") net charge-off ratio of 7.9%, up 150 basis points Average FICO of retained originations 598, up 14 points Issued $8.0 billion in securitizations Originated more than $170 million through our online, direct-to-consumer platform, Roadloans.com Real-time call monitoring rolled out for all inbound/outbound call center lines in 2016 Full year 2016 results demonstrate SC's continued profitability and solid returns, earning net income of $766 million while also taking a measured approach to originations in a competitive market and improving the credit quality of our balance sheet. As expected, our 2016 vintage-level loss performance continues to come in better than We expect this positive trend will be reflected in nominal gross losses in future quarters. We continue to believe our consistent focus on disciplined underwriting, compliance and being simple, personal and fair in everything we do is setting SC up for long-term, sustainable and differentiated success, said Jason Kulas, President and Chief Executive Officer. Mr. Kulas continued, I would like to thank all our employees, customers and dealers for being an integral part of our success this year. We are optimistic about SC's prospects for 2017 as our fundamentals continue to strengthen, and we remain committed to better serving our customers and creating value for all our stakeholders. 1

5 Finance receivables, loans and leases, net 1, increased 4 percent, to $34.2 billion at December 31, 2016, from $32.7 billion at December 31, 2015, driven by an increase in lease assets. Net finance and other interest income decreased 5 percent, to $1.13 billion in the fourth quarter 2016 from $1.19 billion in the fourth quarter 2015, primarily driven by a higher cost of funds and lower interest income from personal installment loans sold in February SC s average annual percentage rate (APR) as of the end of the fourth quarter 2016 for retail installment contracts (RICs) held for investment was 16.4 percent, down from 16.8 percent as of the end of the fourth quarter These APRs are consistent with credit trends in our held for investment portfolio. As of the end of the fourth quarter 2016, RICs with FICO scores less than 540 decreased to 22.1 percent, from 23.4 percent as of the end of the fourth quarter In addition, RICs with FICO scores greater than 640 increased to 13.8 percent, from 12.2 percent. Net leased vehicle income increased 41 percent to $123 million in the fourth quarter 2016 from $87 million in the fourth quarter 2015 due to continued leasing portfolio growth. The allowance for credit loss balance of $3.4 billion at December 31, 2016 increased $9 million, or 26 basis points, from the prior quarter end. The allowance ratio 2 increased to 12.6 percent as of December 31, 2016, from 11.9 percent as of December 31, 2015, primarily driven by the increased balance of loans classified as troubled debt restructurings (TDRs) and a denominator effect from slower portfolio growth. A TDR is an accounting classification for assets that meet certain loan modification or extension criteria. Loan modifications and extensions are utilized to offer assistance to some customers experiencing temporary hardship. Under GAAP, the allowance for assets classified as TDRs takes into consideration expected lifetime losses. SC s RIC net charge-off and delinquency ratio 3 increased to 9.4 percent and 5.1 percent, respectively, for the fourth quarter 2016 from 8.9 percent and 4.4 percent, respectively, for the fourth quarter The increases in the net charge-off and delinquency ratios, and in TDR balances, are driven by the aging of the more nonprime 2015 vintage, and the denominator effect of slower portfolio growth since the prior year fourth quarter. We demonstrated strong access to liquidity in 2016, as we added two new warehouse facilities, including one new committed lender, and we continued to be the largest auto ABS issuer in the market in 2016, issuing $8 billion in securitizations across all three of our platforms said Izzy Dawood, Chief Financial Officer. Improving our liquidity position as we experienced delays in the filing of our financial statements further evidences the consistency of the cash flows of our originations." Mr. Dawood continued, Executing the agreement to flow assets to Banco Santander is a top priority in the first quarter of Along with the national roll out of the dealer VIP program with our Fiat-Chrysler dealers and our continued focus on dealer floorplan lending through Santander Bank N.A. we believe these strategies will positively impact our volume with Chrysler. During the year SC increased the amount of dealers participating in the dealer VIP program with approximately 500 dealers as of year end and increased dealer receivable originations ("floorplan") more than 60 percent versus Provision for credit losses decreased to $686 million in the fourth quarter 2016, from $851 million in the fourth quarter 2015, as the prior year quarter included a qualitative reserve of $149 million to account for the higher concentration of originations with limited credit experience. This reserve was eliminated as of the end of the third quarter 2016 since the model was able to incorporate the loss estimate. In the fourth quarter 2016, SC recorded net investment losses of $168 million, compared to losses of $229 million in the fourth quarter The current period losses were primarily driven by $146 million of lower of cost or market adjustments related to the held for sale personal lending portfolio, including $116 million in customer default activity and a $30 million increase in discount (lower of cost or market) consistent with seasonal origination patterns for this portfolio. Excluding the impact of personal lending, investment losses totaled $23 million driven by losses related to a fourth quarter off-balance sheet securitization and a lower of cost or market adjustment on certain auto assets classified as held for sale. During the quarter, SC incurred $296 million of operating expenses, up 15 percent from $257 million in the fourth quarter 2015, driven by increased compensation expense, primarily due to the continued investment in our control and compliance infrastructure, a non-recurring expense of approximately $13 million and higher repossession expense. 1 Includes Finance receivables held for investment, Finance receivables held for sale and Leased vehicles 2 Excludes end of period balances on purchased receivables portfolio of $158 million and finance receivables held for sale of $2.1 billion 3 Net charge-off ratio stated on a recorded investment basis which is unpaid principal balance adjusted for unaccreted net discounts, subvention and origination costs 2

6 In line with SC s strategy to leverage its scalable servicing platform and increase servicing fee income, SC executed asset sales of $1.4 billion during the fourth quarter through existing loan sale programs and one off-balance sheet securitization, under which it retains servicing. The serviced for others portfolio of $11.9 billion as of December 31, 2016, is down 21 percent from December 31, 2015, driven by lower prime originations and lower prime asset sales, and down 2 percent versus the prior quarter. Servicing fee income decreased 24 percent to $32 million in the fourth quarter 2016, from $42 million in the fourth quarter

7 Conference Call Information SC management will host a conference call and webcast to discuss the fourth quarter results and other general matters at 9 a.m. Eastern Time on Wednesday, January 25, The conference call will be accessible by dialing (U.S. domestic), or (international), conference ID Please dial in 10 minutes prior to the start of the call. The conference call will also be accessible via live audio webcast through the Investor Relations section of the corporate website at Choose Events and select the information pertaining to the Q Earnings Call. Additionally there will be several slides accompanying the webcast. Please allow at least 15 minutes prior to the call to register, download and install any necessary software. For those unable to listen to the live broadcast, a replay will be available on the company s website or by dialing (U.S. domestic), or (international), conference ID , approximately two hours after the event. The dial-in replay will be available for two weeks after the conference call, and the webcast replay will be available through February 8, An investor presentation will also be available by visiting the Investor Relations page of SC s website at Forward-Looking Statements This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of Any statements about our expectations, beliefs, plans, predictions, forecasts, objectives, assumptions, or future events or performance are not historical facts and may be forward-looking. These statements are often, but not always, made through the use of words or phrases such as anticipates, believes, can, could, may, predicts, potential, should, will, estimates, plans, projects, continuing, ongoing, expects, intends, and similar words or phrases. Although we believe that the expectations reflected in these forward-looking statements are reasonable, these statements are not guarantees of future performance and involve risks and uncertainties that are subject to change based on various important factors, some of which are beyond our control. For additional discussion of these risks, refer to the section entitled Risk Factors and elsewhere in our Annual Report on Form 10-K and our Quarterly Reports on Form 10-Q filed by us with the U.S. Securities and Exchange Commission (SEC). Among the factors that could cause the forward-looking statements in this press release and/or our financial performance to differ materially from that suggested by the forward-looking statements are (a) the inherent limitations in internal controls over financial reporting; (b) our ability to remediate any material weaknesses in internal controls over financial reporting completely and in a timely manner; (c) continually changing federal, state, and local laws and regulations could materially adversely affect our business; (d) adverse economic conditions in the United States and worldwide may negatively impact our results; (e) our business could suffer if our access to funding is reduced; (f) significant risks we face implementing our growth strategy, some of which are outside our control; (g) unexpected costs and delays in connection with exiting our personal lending business; (h) our agreement with Fiat Chrysler Automobiles US LLC may not result in currently anticipated levels of growth and is subject to certain performance conditions that could result in termination of the agreement; (i) our business could suffer if we are unsuccessful in developing and maintaining relationships with automobile dealerships; (j) our financial condition, liquidity, and results of operations depend on the credit performance of our loans; (k) loss of our key management or other personnel, or an inability to attract such management and personnel; (l) certain regulations, including but not limited to oversight by the Office of the Comptroller of the Currency, the Consumer Financial Protection Bureau, the European Central Bank, and the Federal Reserve, whose oversight and regulation may limit certain of our activities, including the timing and amount of dividends and other limitations on our business; and (m) future changes in our relationship with Banco Santander that could adversely affect our operations. If one or more of the factors affecting our forward-looking information and statements proves incorrect, our actual results, performance or achievements could differ materially from those expressed in, or implied by, forward-looking information and statements. Therefore, we caution the reader not to place undue reliance on any forward-looking information or statements. The effect of these factors is difficult to predict. Factors other than these also could adversely affect our results, and the reader should not consider these factors to be a complete set of all potential risks or uncertainties. New factors emerge from time to time, and management cannot assess the impact of any such factor on our business or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statement. Any forward-looking statements only speak as of the date of this document, and we undertake no obligation to update any forward-looking information or statements, whether written or oral, to reflect any change, except as required by law. All forward-looking statements attributable to us are expressly qualified by these cautionary statements. About Santander Consumer USA Holdings Inc. Santander Consumer USA Holdings Inc. (NYSE: SC) ( SC ) is a full-service, technology-driven consumer finance company focused on vehicle finance, third-party servicing and delivering superior service to our more than 2.7 million customers across the full credit spectrum. The company, which began originating retail installment contracts in 1997, has a managed asset portfolio of approximately $52 billion (as of December 31, 2016 ), and is headquartered in Dallas. ( ) 4

8 Santander Consumer USA Holdings Inc. Financial Supplement Fourth Quarter and Full Year 2016 Table of Contents Table 1: Consolidated Balance Sheets 6 Table 2: Consolidated Statements of Income 7 Table 3: Other Financial Information 8 Table 4: Credit Quality 10 Table 5: Originations 11 Table 6: Asset Sales 12 Table 7: Ending Portfolio 13 Table 8: Reconciliation of 2015 Non-GAAP Measures 14 5

9 Table 1: Consolidated Balance Sheets Assets December 31, 2016 (Unaudited, Dollars in thousands) December 31, 2015 Cash and cash equivalents $ 160,180 $ 18,893 Finance receivables held for sale, net 2,123,415 2,859,575 Finance receivables held for investment, net 23,481,001 23,367,788 Restricted cash 2,757,299 2,236,329 Accrued interest receivable 373, ,387 Leased vehicles, net 8,564,628 6,497,310 Furniture and equipment, net 67,509 58,007 Federal, state and other income taxes receivable 87, ,636 Related party taxes receivable 1, Goodwill 74,056 74,056 Intangible assets 32,623 33,016 Due from affiliates 31,270 58,599 Other assets 785, ,291 Total assets $ 38,539,104 $ 36,448,958 Liabilities and Equity Liabilities: Notes payable credit facilities $ 6,886,681 $ 6,902,779 Notes payable secured structured financings 21,462,025 20,872,900 Notes payable related party 2,975,000 2,600,000 Accrued interest payable 33,346 22,544 Accounts payable and accrued expenses 379, ,269 Federal, state and other income taxes payable 18,201 2,462 Deferred tax liabilities, net 1,278, ,225 Due to affiliates 50,620 58,148 Other liabilities 217, ,082 Total liabilities 33,300,485 32,016,409 Equity: Common stock, $0.01 par value 3,589 3,579 Additional paid-in capital 1,657,611 1,644,151 Accumulated other comprehensive income (loss), net 28,259 2,125 Retained earnings 3,549,160 2,782,694 Total stockholders equity 5,238,619 4,432,549 Total liabilities and equity $ 38,539,104 $ 36,448,958 6

10 Table 2: Consolidated Statements of Income Three Months Ended December 31, Twelve Months Ended December 31, (Unaudited, Dollars in thousands, except per share amounts) Interest on finance receivables and loans $ 1,222,468 $ 1,270,072 $ 5,026,790 $ 5,031,829 Leased vehicle income 401, ,109 1,487,671 1,037,793 Other finance and interest income 3,695 (5,251) 15,135 18,162 Total finance and other interest income 1,627,183 1,559,930 6,529,596 6,087,784 Interest expense 216, , , ,791 Leased vehicle expense 278, , , ,420 Net finance and other interest income 1,131,974 1,193,782 4,726,653 4,732,573 Provision for credit losses 685, ,723 2,468,200 2,785,871 Net finance and other interest income after provision for credit losses 446, ,059 2,258,453 1,946,702 Profit sharing 12,176 10,649 47,816 57,484 Net finance and other interest income after provision for credit losses and profit sharing 434, ,410 2,210,637 1,889,218 Investment gains (losses), net (168,344) (229,212) (444,759) (95,214) Servicing fee income 32,205 42, , ,113 Fees, commissions, and other 88,143 89, , ,744 Total other income (47,996) (97,587) 93, ,643 Compensation expense 126, , , ,041 Repossession expense 75,539 66, , ,522 Other operating costs 93,384 81, , ,686 Total operating expenses 295, ,622 1,143,472 1,021,249 Income before income taxes 90,186 (21,799) 1,160,711 1,289,612 Income tax expense 28,911 (2,244) 394, ,572 Net income $ 61,275 $ (19,555) $ 766,466 $ 824,040 Net income per common share (basic) $ 0.17 $ (0.05) $ 2.14 $ 2.32 Net income per common share (diluted) $ 0.17 $ (0.05) $ 2.13 $ 2.31 Weighted average common shares (basic) 358,582, ,927, ,280, ,102,742 Weighted average common shares (diluted) 360,323, ,956, ,165, ,163,076 7

11 Table 3: Other Financial Information Ratios Three Months Ended December 31, Twelve Months Ended December 31, (Unaudited, Dollars in thousands) Yield on individually acquired retail installment contracts 15.8% 16.4 % 16.1 % 16.7 % Yield on purchased receivables portfolios 18.1% 25.6 % 24.3 % 16.2 % Yield on receivables from dealers 5.1% 5.3 % 5.2 % 5.0 % Yield on personal loans (1) 22.9% 20.0 % 23.9 % 20.3 % Yield on earning assets (2) 13.5% 14.4 % 14.1 % 14.8 % Cost of debt (3) 2.8% 2.1 % 2.6 % 2.1 % Net interest margin (4) 11.3% 12.7 % 12.0 % 13.1 % Expense ratio (5) 2.3% 2.0 % 2.2 % 2.1 % Return on average assets (6) 0.6% (0.2)% 2.0 % 2.4 % Return on average equity (7) 4.7% (1.8)% 15.8 % 20.1 % Net charge-off ratio on individually acquired retail installment contracts (8) 9.4% 8.9 % 7.9 % 6.7 % Adjusted net charge-off ratio on individually acquired retail installment contracts (8) 9.4% 8.9 % 7.9 % 6.4 % Net charge-off ratio on purchased receivables portfolios (8) 1.3% 3.5 % (0.5)% Net charge-off ratio on receivables from dealers (8) 1.5% 0.5 % Net charge-off ratio on personal loans (8) (9) 40.8 % Adjusted net charge-off ratio on personal loans (8) (9) 17.9 % Net charge-off ratio (8) (9) 8.9% 8.3 % 7.4 % 8.4 % Adjusted net charge-off ratio (8) (9) 8.9% 8.3 % 7.4 % 7.0 % Delinquency ratio on individually acquired retail installment contracts held for investment, end of period (10) 5.1% 4.4 % 5.1 % 4.4 % Delinquency ratio on personal loans, end of period (10) 11.3% 6.9 % 11.3 % 6.9 % Delinquency ratio on loans held for investment, end of period (10) 5.1% 4.6 % 5.1 % 4.6 % Allowance ratio (11) 12.6% 11.9 % 12.6 % 11.9 % Common Equity Tier 1 capital ratio (12) 13.4% 11.2 % 13.4 % 11.2 % Other Financial Information Charge-offs, net of recoveries, on individually acquired retail installment contracts $ 674,442 $ 611,526 $ 2,257,848 $ 1,795,771 Charge-offs, net of recoveries, on purchased receivables portfolios 790 3,383 (17) (2,720) Charge-offs, net of recoveries, on receivables from dealers Charge-offs, net of recoveries, on personal loans 673,294 Charge-offs, net of recoveries, on capital leases 2,219 19,859 9,384 30,907 Total charge-offs, net of recoveries $ 677,709 $ 634,768 $ 2,267,608 $ 2,497,252 End of period Delinquent principal over 60 days, individually acquired retail installment contracts held for investment $ 1,386,218 $ 1,191,567 $ 1,386,218 $ 1,191,567 End of period Delinquent principal over 60 days, personal loans $ 176,873 $ 168,906 $ 176,873 $ 168,906 End of period Delinquent principal over 60 days, loans held for investment $ 1,392,789 $ 1,377,770 $ 1,392,789 $ 1,377,770 End of period assets covered by allowance for credit losses $ 27,229,276 $ 27,007,816 $ 27,229,276 $ 27,007,816 End of period Gross finance receivables and loans held for investment $ 27,427,578 $ 27,368,579 $ 27,427,578 $ 27,368,579 End of period Gross finance receivables, loans, and leases held for investment $ 37,040,531 $ 34,694,875 $ 37,040,531 $ 34,694,875 Average Gross individually acquired retail installment contracts $ 28,604,117 $ 27,560,674 $ 28,652,897 $ 26,818,625 Average Gross purchased receivables portfolios 241, , , ,512 Average Gross receivables from dealers 69,745 76,598 71,997 89,867 Average Gross personal loans 1,405,187 2,309,474 1,413,440 2,229,080 Average Gross capital leases 34,584 94,670 45, ,605 Average Gross finance receivables, loans and capital leases $ 30,355,037 $ 30,426,836 $ 30,470,637 $ 29,814,689 Average Gross finance receivables, loans, and leases $ 39,941,127 $ 37,531,621 $ 39,289,341 $ 36,140,498 Average Managed assets $ 52,038,692 $ 52,485,567 $ 52,731,119 $ 48,919,418 8

12 Average Total assets $ 38,513,454 $ 36,039,307 $ 37,944,529 $ 35,050,503 Average Debt $ 31,416,694 $ 30,137,927 $ 31,330,686 $ 29,699,885 Average Total equity $ 5,185,840 $ 4,447,457 $ 4,850,653 $ 4,096,042 (1) Includes Finance and other interest income; excludes fees (2) Yield on earning assets is defined as the ratio of annualized Total finance and other interest income, net of Leased vehicle expense, to Average gross finance receivables, loans and leases (3) Cost of debt is defined as the ratio of annualized Interest expense to Average debt (4) Net interest margin is defined as the ratio of annualized Net finance and other interest income to Average gross finance receivables, loans and leases (5) Expense ratio is defined as the ratio of annualized Operating expenses to Average managed assets (6) Return on average assets is defined as the ratio of annualized Net income to Average total assets (7) Return on average equity is defined as the ratio of annualized Net income to Average total equity (8) Net charge-off ratio is defined as the ratio of annualized Charge-offs, on a recorded investment basis, net of recoveries, to average unpaid principal balance of the respective portfolio (9) Effective as of September 30, 2015, changes in the value of the personal lending portfolio driven by customer default activity are classified in net investment gains (losses) due to the classification of the portfolio as held for sale. As there was accordingly no charge-off activity on personal loans for the three months ended December 31, 2015, the annualized charge-off rate on personal loans reported as of September 30, 2015 has been used as the full year charge-off rate. The average gross balance of personal loans used in the full year charge-off rate was $2,201,551. Additionally, the denominators of the aggregate Net charge-off ratios for the three and twelve months ended December 31, 2015 have been adjusted to $28,123,241 and $29,279,874, respectively, to exclude Personal Lending balances for the three months ended December 31, (10) Delinquency ratio is defined as the ratio of End of period Delinquent principal over 60 days to End of period gross balance of the respective portfolio, excludes capital leases (11) Allowance ratio is defined as the ratio of Allowance for credit losses, which excludes impairment on purchased receivables portfolios, to End of period assets covered by allowance for credit losses (12) Common Equity Tier 1 Capital ratio is a non-gaap ratio defined as the ratio of Total common equity tier 1 capital to Total risk-weighted assets 9

13 Table 4: Credit Quality Amounts related to our individually acquired retail installment contracts as of and for the three and twelve months December 31, 2016 and 2015, are as follows: (Unaudited, Dollars in thousands) Three Months Ended December 31, Twelve Months Ended December 31, Credit loss allowance beginning of period $ 3,401,285 $ 2,982,699 $ 3,197,414 $ 2,586,685 Provision for credit losses 684, ,241 2,471,490 2,433,617 Charge-offs (1,293,743) (1,143,727) (4,723,648) (3,897,480) Recoveries 619, ,201 2,465,800 2,101,709 Transfers to held-for-sale (27,117) Credit loss allowance end of period $ 3,411,056 $ 3,197,414 $ 3,411,056 $ 3,197,414 Net charge-offs $ 674,442 $ 611,526 $ 2,257,848 $ 1,795,771 Average unpaid principal balance (UPB) 28,604,117 27,560,674 28,652,897 26,818,625 Charge-off ratio 1 9.4% 8.9% 7.9% 6.7% December 31, December 31, Principal days past due $ 2,735, % $ 2,454, % Delinquent principal over 60 days 1,386, % 1,191, % Total delinquent contracts $ 4,121, % $ 3,646, % December 31, 2016 December 31, 2015 (Dollar amounts in thousands) TDR - Unpaid principal balance $ 5,599,567 $ 4,579,931 Non-TDR - Unpaid principal balance $ 21,528,406 $ 22,284,015 Total - Unpaid principal balance $ 27,127,973 $ 26,863,946 Total - Allowance $ 3,411,056 $ 3,197,414 Total allowance ratio 12.6% 11.9% 1 Net charge-off ratio is defined as the ratio of annualized Charge-offs, on a recorded investment basis, net of recoveries, to average unpaid principal balance of the respective portfolio 2 Percent of unpaid principal balance. 10

14 Table 5: Originations Three Months Ended Twelve Months Ended Three Months Ended December 31, 2016 December 31, 2015 December 31, 2016 December 31, 2015 September 30, 2016 Retained Originations (Unaudited, Dollar amounts in thousands) Retail installment contracts $ 3,068,154 $ 3,830,337 $ 12,726,912 $ 16,692,229 $ 3,281,112 Average APR 15.4% 13.9% 15.7% 16.9% 14.7% Average FICO (a) Discount 0.3% 1.5% 0.5% 1.8% 0.1% Personal loans $ 190,143 $ 304,748 $ 199,424 $ 887,483 $ Average APR 25.2% 24.4% 25.1% 21.2% Discount Leased vehicles $ 971,865 $ 1,009,526 $ 5,584,149 $ 5,132,053 $ 1,300,375 Capital lease receivables $ 1,424 $ 2,338 $ 7,401 $ 67,244 $ 2,319 Total originations retained $ 4,231,586 $ 5,146,949 $ 18,517,886 $ 22,779,009 $ 4,583,806 Sold Originations (b) Retail installment contracts $ 484,916 $ 1,098,674 $ 3,573,658 $ 5,419,730 $ 580,242 Average APR 4.4% 2.6% 4.3% 4.2% 3.2% Average FICO (c) Total originations sold $ 484,916 $ 1,098,674 $ 3,573,658 $ 5,419,730 $ 580,242 Total SC originations $ 4,716,502 $ 6,245,623 $ 22,091,544 $ 28,198,739 $ 5,164,048 Facilitated Originations Leased vehicles $ $ $ $ 632,471 $ Total originations $ 4,716,502 $ 6,245,623 $ 22,091,544 $ 28,831,210 $ 5,164,048 (a) Unpaid principal balance excluded from the weighted average FICO score is $426 million, $688 million, $2.1 billion, $3.2 billion and $492 million for the three months ended December 31, 2016 and 2015, the twelve months ended December 31, 2016 and 2015, and the three months ended September 30, 2016, respectively, as the borrowers on these loans did not have FICO scores at origination. Of these amounts, $71 million, $215 million, $364 million, $650 million, and $74 million, respectively, were commercial loans. (b) Only includes assets both originated and sold in the period. Total asset sales for the period are shown in Table 6. (c) Unpaid principal balance excluded from the weighted average FICO score is $50 million, $137 million, $451 million, $647 million and $59 million for the three months ended December 31, 2016 and 2015, the twelve months ended December 31, 2016 and 2015, and the three months ended September 30, 2016, respectively, as the borrowers on these loans did not have FICO scores at origination. Of these amounts, $8 million, $2 million, $86 million, $108 million, and zero, respectively, were commercial loans. 11

15 Table 6: Asset Sales Asset sales may include assets originated in prior periods. Three Months Ended Twelve Months Ended Three Months Ended December 31, 2016 December 31, 2015 December 31, 2016 December 31, 2015 (Unaudited, Dollar amounts in thousands) September 30, 2016 Retail installment contracts $ 1,381,036 $ 1,869,113 $ 3,694,019 $ 7,862,520 $ 793,804 Average APR 6.3% 4.5% 4.2% 7.2% 3.0% Average FICO Personal loans $ $ $ 869,349 $ $ Average APR 17.9% Leased vehicles $ $ $ $ 1,316,958 $ Total asset sales $ 1,381,036 $ 1,869,113 $ 4,563,368 $ 9,179,478 $ 793,804 12

16 Table 7: Ending Portfolio Ending outstanding balance, average APR and remaining unaccreted discount of our held for investment portfolio as of December 31, 2016, and December 31, 2015, are as follows: December 31, 2016 December 31, 2015 ( Unaudited, Dollar amounts in thousands) Retail installment contracts $ 27,358,147 $ 27,223,768 Average APR 16.4% 16.8% Discount 2.3% 2.7% Personal loans $ 11,839 $ 941 Average APR 31.5% 20.9% Receivables from dealers $ 69,431 $ 76,941 Average APR 4.9% 4.6% Leased vehicles $ 9,612,953 $ 7,326,296 Capital leases $ 31,872 $ 66,929 13

17 Table 8: Reconciliation of 2015 Non-GAAP Measures (Dollars in thousands) For the Year Ended December 31, 2015 Charge-offs, net of recoveries on personal loans $ 673,294 Deduct: LOCM adjustment on personal loans (377,598) Adjusted Net charge-offs on personal loans $ 295,696 Average gross personal loans 1 $ 2,201,551 Net charge-off ratio on personal loans 40.8% Adjusted net charge-off ratio on personal loans 17.9% Charge-offs, net of recoveries on retail installment contracts acquired individually $ 1,795,771 Deduct: LOCM adjustment on retail installment contracts acquired individually (73,388) Adjusted Net charge-offs on retail installment contracts acquired individually $ 1,722,383 Average Gross retail installment contracts acquired individually $ 26,818,625 Net charge-off ratio on retail installment contracts acquired individually 6.7% Adjusted Net charge-off ratio on retail installment contracts acquired individually 6.4% Total charge-offs, net of recoveries $ 2,497,252 Deduct: LOCM adjustment on personal loans (377,598) Deduct: LOCM adjustment on retail installment contracts acquired individually (73,388) Adjusted Net charge-offs total $ 2,046,266 Average Gross finance receivables and loans 1 $ 29,279,874 Net charge-off ratio 8.4% Adjusted Net charge-off ratio total 7.0% 1 The denominators of the Personal Lending Net charge-off ratios and the aggregate Net charge-off ratios for the three and twelve months ended December 31, 2015 have been adjusted to exclude Personal Lending balances for the three months ended December 31,

18 SANTANDER CONSUMER USA HOLDINGS INC. Fourth Quarter and Full Year 2016

19 2IMPORTANT INFORMATION Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of Any statements about our expectations, beliefs, plans, predictions, forecasts, objectives, assumptions, or future events or performance are not historical facts and may be forward-looking. These statements are often, but not always, made through the use of words or phrases such as anticipates, believes, can, could, may, predicts, potential, should, will, estimates, plans, projects, continuing, ongoing, expects, intends, and similar words or phrases. Although we believe that the expectations reflected in these forward-looking statements are reasonable, these statements are not guarantees of future performance and involve risks and uncertainties that are subject to change based on various important factors, some of which are beyond our control. For additional discussion of these risks, refer to the section entitled Risk Factors and elsewhere in our Annual Report on Form 10-K and our Quarterly Reports on Form 10-Q filed by us with the U.S. Securities and Exchange Commission (SEC). Among the factors that could cause the forward-looking statements in this presentation and/or our financial performance to differ materially from that suggested by the forward-looking statements are (a) the inherent limitations in internal controls over financial reporting; (b) our ability to remediate any material weaknesses in internal controls over financial reporting completely and in a timely manner; (c) continually changing federal, state, and local laws and regulations could materially adversely affect our business; (d) adverse economic conditions in the United States and worldwide may negatively impact our results; (e) our business could suffer if our access to funding is reduced; (f) significant risks we face implementing our growth strategy, some of which are outside our control; (g) unexpected costs and delays in connection with exiting our personal lending business; (h) our agreement with Fiat Chrysler Automobiles US LLC may not result in currently anticipated levels of growth and is subject to certain performance conditions that could result in termination of the agreement; (i) our business could suffer if we are unsuccessful in developing and maintaining relationships with automobile dealerships; (j) our financial condition, liquidity, and results of operations depend on the credit performance of our loans; (k) loss of our key management or other personnel, or an inability to attract such management and personnel; (l) certain regulations, including but not limited to oversight by the Office of the Comptroller of the Currency, the Consumer Financial Protection Bureau, the European Central Bank, and the Federal Reserve, whose oversight and regulation may limit certain of our activities, including the timing and amount of dividends and other limitations on our business; and (m) future changes in our relationship with Banco Santander that could adversely affect our operations. If one or more of the factors affecting our forward-looking information and statements proves incorrect, our actual results, performance or achievements could differ materially from those expressed in, or implied by, forward-looking information and statements. Therefore, we caution the reader not to place undue reliance on any forward- looking information or statements. The effect of these factors is difficult to predict. Factors other than these also could adversely affect our results, and the reader should not consider these factors to be a complete set of all potential risks or uncertainties. New factors emerge from time to time, and management cannot assess the impact of any such factor on our business or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statement. Any forward-looking statements only speak as of the date of this document, and we undertake no obligation to update any forward-looking information or statements, whether written or oral, to reflect any change, except as required by law. All forward-looking statements attributable to us are expressly qualified by these cautionary statements.

20 3» Net income for the year of $766 million, or $2.13 per diluted common share, down 7% year-over-year» Interest on individually acquired retail installment contracts of $4.6 billion, up 3%» Net finance and other interest income of $4.7 billion, flat» Expense ratio of 2.2%, up 10 basis points» Return on average assets of 2.0%, Return on average equity of 15.8%» Total auto originations of $21.9 billion, down 20%» Average managed assets of $52.7 billion, up 8%» Retail installment contract ("RIC") net charge-off ratio of 7.9%, up 150 basis points1» Average FICO of retained originations 598, up 14 points» Issued $8.0 billion in securitizations» Originated more than $170 million through our online, direct-to-consumer platform, Roadloans.com» Real-time call monitoring rolled out for all inbound/outbound call center lines in 2016 FY 2016 HIGHLIGHTS Setting SC up for long-term success by delivering value to shareholders while focusing on disciplined underwriting, compliance and being simple, personal and fair. 1 Versus adjusted 2015 ratio of 6.4% versus GAAP ratio of 6.7%, details found in Table 8 of the press release issued January 25, 2017, reconciliation of non-gaap measures

21 4ECONOMIC INDICATORS U.S. Auto Sales1 Units in Millions 1 St. Louis Fed Research 2 University of Michigan 3 Bloomberg 4 Bureau of Labor Statistics Consumer Confidence2 Index Q1 1966=100 U.S. GDP3 YOY% U.S. Unemployment Rate4 % OR IGIN A TI O N S CRE D IT 98.2 Max 98.2 Min 55.3 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec % Max 10.0% Min 4.4% Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec % Max 3.2% Min -4.1% Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec Max 18.8 Min 9.0 Dec-06 Dec-07 Dec-08-9 Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16

22 5 8.4% Nov-06 Nov-08 Nov-10 Nov-12 Nov-14 Nov % 48.1% 0 Dec-12 Jun-13 Dec-13 Jun-14 Dec-14 Jun-15 Dec-15 Jun-16 Dec-16 SC Auction Only Recovery Rate SC Auction Plus Recovery Rate 4.8% Nov-06 Nov-08 Nov-10 Nov-12 Nov-14 Nov Dec-12 Jun-13 Dec-13 Jun-14 Dec-14 Jun-15 Dec-15 Jun-16 Dec-16 Manheim (Left Axis) NADA (Right Axis) AUTO INDUSTRY ANALYSIS Used Vehicle Indices1 Manheim: Seasonally Adjusted NADA: Not Seasonally Adjusted 1 Manheim, Inc.; Indexed to a basis of 100 at 1995 levels; National Automotive Dealers Association 2 Auction Only - includes all auto-related recoveries including inorganic/purchased receivables from auction lanes only 2 Auction Plus GAAP Recoveries which also includes insurance proceeds, bankruptcy/deficiency sales, and timing impacts Q Standard & Poor s Rating Services (ABS Auto Trust Data two-month lag on data, as of December 31, 2016) SC Recovery Rates2 Industry Net Loss Rates3 Nonprime Industry 60+ Day Delinquency Rates3 Nonprime SE V ER IT Y CRE D IT

23 6 VEHICLE FINANCE LEVERAGING TECHNOLOGY IS INTEGRAL TO THE FOUR PILLARS OF OUR FOCUSED BUSINESS MODEL FOCUSED BUSINESS MODEL DISCIPLINED APPROACH TO MARKET SIMPLE, PERSONAL, FAIR APPROACH WITH CUSTOMERS, EMPLOYEES AND ALL CONSTITUENCIES SERVICED FOR OTHERS FUNDING AND LIQUIDITY CULTURE OF COMPLIANCE

24 7 $ in millions Q Q Quarterly YoY FYoFY Total Core Retail Auto 1,981$ 2,010$ 10,826$ 8,250$ 1% (24%) Chrysler Capital Loans (<640)1 1, ,473 3,722 (38%) (32%) Chrysler Capital Loans ( 640)1 1, ,813 4,328 (55%) (26%) Total Chrysler Capital Retail 2,948 1,543 11,286 8,051 (48%) (29%) Total Leases2 1, ,199 5,592 (4%) 8% Total Auto Originations 5,941 4,526 27,311 21,892 (24%) (20%) Total Personal Lending N/A (78%) Total Originations 6,246$ 4,716$ 28,199$ 22,091$ (24%) (22%) Asset Sales 1,869 1,381 9,179 4,563 (26%) (50%) Serviced for Others Portfolio 15,047 11,945 15,047 11,945 (21%) (21%) Average Managed Assets 52,486 52,039 48,919 52,731 (1%) 8% Quarterly Originations Full Year Originations % Variance Balances Balances DISCIPLINED LOAN UNDERWRITING CONTINUES IN 4Q16 1 Approximate FICO score 2 Includes some capital lease originations Full year average managed assets increased. Auto origination decreases driven by disciplined underwriting in a competitive market.

25 8 61% 51% 57% 56% 53% 39% 49% 43% 44% 47% 4Q15 1Q16 2Q16 3Q16 4Q16 New/Used Originations ($ in millions) Used New ORIGINATIONS EXHIBIT DISCIPLINED UNDERWRITING 1 Loans to commercial borrowers; no FICO score obtained Originations < 640 were down $590 million YoY Average 598 FICO for retained 2016 originations, up 14 points versus 2015 retained originations Higher percentage of used vehicles YoY and stable throughout 2016 Average loan balances on originations down YoY, reflecting larger percentage of used vehicles and lower LTVs Average loan balance in dollars $23,721 $21,745 $21,929 $21,482 $21,488 $3,723 4% 4% 3% 2% 2% 12% 14% 13% 12% 11% 12% 15% 12% 13% 15% 20% 22% 20% 23% 24% 12% 13% 13% 14% 15% 39% 32% 40% 35% 32% 4Q15 1Q16 2Q16 3Q16 4Q16 Originations by Credit (RIC only) ($ in millions) > <540 No FICO Commercial $4,929 $5,162 $3,553$3,723 $3,861 $2,416 $3,007 $3,861 $3,553$5,162$4,929 1

26 9 Significant opportunity in prime originations Executing the Banco Santander flow agreement is a top priority in Q FCA has sold more than 2 million units annually since 2014 December 2016 penetration rate of 17% Accomplishments and Improvements SC remained the largest provider for FCA FCA and SC s relationship provides a unique offering for nonprime consumers in comparison to other original equipment manufacturers ( OEMs ) Continued to refine dealer VIP program; approximately 500 dealerships participating On track for a national rollout in 2017 The VIP program is leading to an increase in applications and funding without impacting underwriting standards Through Santander Bank N.A. ( SBNA ), SC has increased dealer receivable originations ( floorplan ) more than 60% compared to 2015 CHRYSLER CAPITAL 1 FCA filings; sales as reported on 01/04/2017 SC continues to work strategically and collaboratively with FCA to continue to strengthen the relationship and create value within the Chrysler Capital program FCA Sales1 (units in millions)

27 10 $15,047 $14,235 $13,034 $12,157 $11,945 4Q15 1Q16 2Q16 3Q16 4Q16 $ in Millions Flow Programs 1, CCART Recent decrease in total balance related to lower prime originations Growth in SFO remains dependent upon Chrysler Capital Penetration SERVICED FOR OTHERS PLATFORM Composition at 12/31/2016 RIC 77% Leases 16% RV/Marine 7% Total 100% Serviced for Others Balances Flow programs continue to drive asset sales Recent CCART sale helped offset continued amortization *Sales with retained servicing during period

28 11FY 2016 FUNDING AND LIQUIDITY Issued and sold $8.3 billion in bonds across three distinct platforms SDART: $3.4 billion DRIVE: $3.1 billion CCART: $1.8 billion 200+ distinct investors participate in SC s platforms SC remains the largest issuer of retail auto ABS globally Over $400 million in retained bonds sold in secondary markets Asset-Backed Securitizations Asset Sales and Flow ProgramsIntragroup Third-Party Funding $2.8 billion of asset sales through flow programs $900 million in assets sold through CCART 2016-B $900 million of Lending Club assets sold SHUSA commitment increased from $1.5 billion to $3.0 billion Unused capacity at year-end of 53%, increased from 46% at year- end financial institution relationships with more than $18 billion in total commitments Over $5.2 billion in incremental private term financings New revolving funding commitments: $800 million in prime loan revolving capacity $200 million in subprime loan revolving capacity

29 12» Net income of $61 million, or $0.17 per diluted common share» Non-recurring expense of $0.03 cents per diluted common share» Total auto originations of $4.5 billion» Core up 1% year-over-year» Total finance and other interest income of $1.6 billion, up 4%» Net finance and other interest income of $1.1 billion, down 5%» CET1 ratio of 13.4%, demonstrating SC s ability to generate earnings and capital» Issued $3.3 billion in securitizations» Continued strength in ABS platforms evidenced by the upgrade of 30 ABS tranches by Moody s, S&P and Fitch across multiple platforms during the quarter, positively impacting more than $2.7 billion in securities Q HIGHLIGHTS Setting SC up for long-term success by delivering value to shareholders while focusing on disciplined underwriting, compliance and being simple, personal and fair.

30 13Q FINANCIAL RESULTS December 31, 2016 September 30, 2016 December 31, 2015 QoQ YoY Interest on finance receivables and loans 1,222,468$ 1,246,386$ 1,270,072$ (2%) (4%) Net leased vehicle income 122, ,771 86,854 (10%) 41% Other finance and interest income 3,695 3,638 (5,251) 2% (170%) Interest expense 216, , ,893 5% 37% Net finance and other interest income 1,131,974 1,178,620 1,193,782 (4%) (5%) Provision for credit losses 685, , ,723 12% (19%) Profit sharing 12,176 6,400 10,649 90% 14% Total other income (47,996) 26,682 (97,587) (280%) (51%) Total operating expenses 295, , ,622 4% 15% Income before tax 90, ,020 (21,799) (70%) N/M Income tax expense 28,911 90,473 (2,244) (68%) N/M Net income 61, ,547 (19,555) (71%) N/M Diluted EPS ($) 0.17$ 0.59$ (0.05)$ (71%) N/M Average total assets 38,513,454$ 38,473,832$ 36,039,289$ 0% 7% Average managed assets 52,038,692$ 52,675,379$ 52,485,567$ (1%) (1%) Three Months Ended (Unaudited, Dollars in Thousands, except per share) % Variance

31 14Q EXCLUDING PERSONAL LENDING *Additional details can be found in Appendix December 31, 2016 September 30, 2016 December 31, 2015 QoQ YoY Interest on finance receivables and loans 1,142,176$ 1,167,675$ 1,154,720$ (2%) (1%) Net leased vehicle income 122, ,771 86,854 (10%) 41% Other finance and interest income 3,695 3,638 (5,251) 2% (170%) Interest expense 206, , ,309 5% 45% Net finance and other interest income 1,062,403 1,110,100 1,094,014 (4%) (3%) Provision for credit losses 685, , ,723 12% (19%) Profit sharing 9,219 10,957 10,649 (16%) (13%) Investment gains (losses), net (22,614) (10,404) 7, % (415%) Servicing fee income 32,205 36,447 42,357 (12%) (24%) Fees, commissions and other 39,616 46,426 41,713 (15%) (5%) Total other income 49,207$ 72,469$ 91,255$ (32%) (46%) Average gross individually acquired retail installment contracts 28,604,117$ 28,970,039$ 27,560,674$ (1%) 4% Average gross operating leases 9,586,090$ 9,347,620$ 7,096,406$ 3% 35% Three Months Ended (Unaudited, Dollars in Thousands) % Variance

32 15 31-Dec Mar Jun Sep Dec-16 Reported Total Other Income (Loss) (97,587)$ 77,558$ 37,302$ 26,682$ (47,996)$ Reported Investment Gains (Losses), Net (229,212)$ (69,056)$ (101,309)$ (106,050)$ (168,344)$ Add back: Personal Lending LOCM Adjustments 236,396 64,213 94,767 95, ,730 Other 14,226 6,451 7,330 6,639 - Normalized Investment Gains (Losses), Net 21,410 1, (3,765) (22,614) Servicing Fee Income 42,357 44,494 42,988 36,447 32,205 Fees, Commissions, and Other1 89, ,120 95,623 96,285 88,143 Normalized Total Other Income 153,035$ 148,222$ 139,399$ 128,967$ 97,734$ Customer Default Activity 123, ,347 97, , ,097 Fair Value Discount 113,142 (37,134) (2,402) (18,831) 29,633 Denotes quarters with CCART sales Three Months Ended (Unaudited, Dollars in Thousands) TOTAL OTHER INCOME SC s strategy is to price loans sold under flow agreements close to par, with minimal investment gains (losses), to generate further growth in the serviced for others platform and drive increased fee income In Q3 2015, SC designated the personal lending portfolio as held for sale and released any allowance associated with the portfolio; any lower of cost or market ( LOCM ) impact related to personal lending in Q was recognized through provision for credit losses Beginning in Q4 2015, net investment gains (losses) include the impact of personal lending assets Customer defaults, as part of LOCM adjustments on the personal lending portfolio designated as held for sale, are recognized through net investment gains (losses) Seasonal balances will impact magnitude of LOCM adjustments; this quarter included higher LOCM adjustments driven by seasonal increases in the personal lending portfolio 1 Fees, commissions and other includes fee income from the personal lending and auto portfolios

33 16CREDIT QUALITY: LOSS PERFORMANCE Gross Losses *Retained originations only 1Auction fees included in net losses. Financial statements reflect auction fees in repossession expense, therefore, net losses included on this slide are higher 2First half vintage describes January through June vintage performance through the end of December, for each respective year Net Losses1 6.7% 7.2% 6.5% 6.0% 6.2% 6.4% 6.6% 6.8% 7.0% 7.2% 7.4% 1H H H 2016 First Half Vintage Performance2 Early indications show the first half of the 2016 vintage is outperforming the 2015 vintage on a gross and net loss basis, as of the end of the year each vintage was originated. 4.0% 4.4% 3.9% 3.6% 3.8% 4.0% 4.2% 4.4% 4.6% 1H H H 2016 First Half Vintag Performance2

34 17 $3,413 $113 $154 $20 ($278) $3,422 $3,000 $3,100 $3,200 $3,300 $3,400 $3,500 $3,600 $3,700 $3,800 Q New Volume TDR Migration Performance Adjustment Liquidations & Other Q Q to Q ALLL Reserve Walk2 ($ in millions) $851 $660 $512 $610 $ % 12.0% 12.6% 12.4% 12.6% 11.4% 11.6% 11.8% 12.0% 12.2% 12.4% 12.6% 12.8% $0 $200 $400 $600 $800 $1,000 Q Q Q Q Q Provision Expense and Allowance Ratio ($ in millions) Provision for credit losses Allowance Ratio PROVISION AND RESERVES Allowance to loans ratio increased to 12.6% QoQ, primarily driven by the increased balance of loans classified as TDRs and the denominator effect of slower portfolio growth Provision for credit losses decreased YoY primarily driven by a qualitative reserve in the prior year quarter for loans with limited credit experience QoQ allowance increased $9 million New volume and TDR migration1 were offset by liquidations and other 1 TDR migration the allowance for assets classified as TDRs or troubled debt restructuring takes into consideration expected lifetime losses, requiring additional coverage 2 Explanation of quarter over quarter variance are estimates

35 % 16.3% 14.2% 17.2% 18.1% 8.9% 7.6% 5.7% 8.7% 9.4% 46% 53% 60% 49% 48% 0% 10% 20% 30% 40% 50% 60% 70% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% 18.0% 20.0% Q Q Q Q Q Credit: Individually Acquired Retail Installment Contracts, Held for Investment Gross Charge- off Ratio Net Charge-off Ratio Recovery Rate (as % of recorded investment) 9.1% 6.9% 9.0% 9.2% 10.0% 3.8% 4.4% 3.1% 4.2% 4.6% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% Q Q Q Q Q Delinquency: Individually Acquired Retail Installment Contracts, Held for Investment LOSS AND DELINQUENCY YoY delinquency increased for each delinquency bucket Primary drivers: 2015 originations more nonprime in nature Slower portfolio growth YoY gross loss increased 150 basis points Primary drivers: 2015 originations more nonprime in nature Slower portfolio growth Recovery rates and net losses in Q benefited by proceeds from bankruptcy sales1 1 Excluding bankruptcy sales, recovery rates would have been 59%

36 19 $612 $674 $83 ($8) ($12) Q Portfolio Growth, Aging and Mix Shift Recoveries Bankruptcy Sales Q Q to Q Net Charge-Off Walk ($ in millions) CREDIT QUALITY: LOSS DETAIL Overall increase is primarily due to a combination of portfolio growth, portfolio aging and mix shift 2015 vintage represents largest portion of losses * Individually acquired retail installment contracts

37 20 $52,486 $52,962 $53,237 $52,675 $52,039 $257 $291 $272 $284 $ % 2.2% 2.0% 2.2% 2.3% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% $2 $10,002 $20,002 $30,002 $40,002 $50,002 $60,002 Q Q Q Q Q Average Managed Assets ($ millions) Total Expenses ($ millions) EXPENSE MANAGEMENT Operating expenses totaled $296 million, an increase of 15% versus the same quarter last year, driven by higher compensation expenses, a non-recurring expense of $13 million and higher repo expenses Excluding non-recurring expenses, increase of 10%

38 Q Q Unused Used Q Q Unused Used Q FUNDING AND LIQUIDITY Total committed liquidity of $38.5 billion at end of Q4 2016, up 5% from $36.8 billion at the end of Q Asset-Backed Securities ($ Billions) Private Financings ($ Billions) Banco Santander & Subsidiaries ($ Billions) Asset Sales ($ Billions) Executed across all ABS platforms in Q $6.3 billion in total commitments 53% unused capacity at Q Increase driven by CCART transaction Amortizing Revolving 10.8 $18.7 billion in commitments from 14 lenders 36% unused capacity on revolving lines at Q Q Q Q Q Q Q4 2016

39 22CONSISTENT CAPITAL GENERATION 1 Common Equity Tier 1 (CET1) Capital Ratio begins with stockholders equity and then adjusts for AOCI, goodwill/intangibles, DTAs, cash flow hedges and other regulatory exclusions over risk- weighted assets; Non-GAAP measure 2Tangible common equity to tangible assets is defined as the ratio of Total equity, excluding Goodwill and intangible assets, to Total assets, excluding Goodwill and intangible assets; Non-GAAP measure, reconciliation in Appendix 1 2 SC has exhibited a strong ability to generate earnings and capital, while growing assets. Tangible Assets $36,342 $37,661 $38,383 $38,665 $38,432 Tangible Common Equity $4,325 $4,497 $4,769 $5,011 $5, % 12.1% 12.6% 13.1% 13.4% 11.9% 11.9% 12.4% 13.0% 13.4% Q Q Q Q Q CET1 TCE/TA $ in millions

40 APPENDIX

41 24SANTANDER CONSUMER USA HOLDINGS INC. 1 As of December 31, DDFS LLC is an entity owned by former Chairman and Chief Executive Officer, Tom Dundon. This purchase would result in SHUSA owning approximately 68.8% of SC. 3 Chrysler Capital is a dba of Santander Consumer USA Santander Consumer USA Holdings Inc. (NYSE:SC) ( SC ) is approximately 58.9%1 owned by Santander Holdings USA, Inc. ( SHUSA ), a wholly-owned subsidiary of Banco Santander, S.A. (NYSE:SAN) On July 3, 2015, SHUSA elected to exercise its right to purchase all of the shares of SC common stock owned by DDFS LLC, subject to regulatory approval and applicable law2 SC is a full-service, technology-driven consumer finance company focused on vehicle finance, third-party servicing and providing superior customer service Historically focused on nonprime markets; established presence in prime and lease Approximately 5,100 full-time, 80 part-time and 1,500 vendor-based employees across multiple locations in the U.S. and the Caribbean Our strategy is to leverage our efficient, scalable technology and risk infrastructure and data to underwrite, originate and service profitable assets while treating employees, customers and all stakeholders in a simple, personal and fair manner Unparalleled compliance and responsible practices focus Continuously optimizing the mix of assets retained vs. assets sold and serviced for others Presence in prime markets through Chrysler Capital3 Efficient funding through key third-party relationships, secondary markets and Santander Solid capital base Overview Strategy

42 25COMPANY ORGANIZATION Other Subsidiaries 100% Ownership Santander Holdings USA, Inc. ( SHUSA ) 58.8% Ownership Santander Consumer USA Holdings Inc. ( SC ) Santander Bank, N.A. Other Subsidiaries 9.7% Ownership (11.3% Beneficial Ownership)1 DDFS LLC2 and Tom Dundon 0.0% Ownership (0.4% Beneficial Ownership)1 31.4% Ownership Other Management Public Shareholders Banco Santander, S.A. Spain *Ownership percentages are approximates as of December 31, Beneficial ownership includes options currently exercisable or exercisable within 60 days of December 31, On July 3, 2015, SHUSA elected to exercise the right to purchase shares of SC common stock owned by DDFS LLC, an entity owned by former Chairman and Chief Executive Officer, Thomas Dundon, subject to regulatory approval and applicable law. This purchase would result in SHUSA owning approximately 68.5% of SC.

43 26HELD FOR INVESTMENT CREDIT TRENDS Retail Installment Contracts1 1Held for investment; excludes assets held for sale 4.0 % 12. 2% 23. 4% 30. 9% 17. 3% 12. 2% 4.2 % 12.6% 23. 2% 31. 0% 17. 1% 11. 9% 2.6 % % 22. 9% 31. 2% 17. 4% 13. 3% 3.3 % 12.4% 22. 2% 31. 1% 17. 2% 13. 8% 3.1 % 12.2% 22. 1% 31. 4% 17. 4% 13. 8% Commercial Unknown < >=640 Q Q Q Q Q4 2016

44 27Q EXCLUDING PERSONAL LENDING DETAIL As Reported Personal Lending Excluding Personal Lending As Reported Personal Lending Excluding Personal Lending As Reported Personal Lending Excluding Personal Lending Interest on finance receivables and loans $ 1,222,468 $ 80,292 $ 1,142,176 $ 1,246,386 $ 78,711 $ 1,167,675 $ 1,270,072 $ 115,352 $ 1,154,720 Net leased vehicle income 122, , , ,771 86,854-86,854 Other finance and interest income 3,695-3,695 3,638-3,638 (5,251) - (5,251) Interest expense 216,980 10, , ,175 10, , ,893 15, ,309 Net finance and other interest income 1,131,974 69,571 1,062,403 1,178,620 68,520 1,110,100 1,193,782 99,768 1,094,014 Provision for credit losses 685, , , , , ,723 Profit sharing 12,176 2,957 9,219 6,400 (4,557) 10,957 10,649-10,649 Investment gains (losses), net (168,344) (145,730) (22,614) (106,050) (95,646) (10,404) (229,212) (236,397) 7,185 Servicing fee income 32,205-32,205 36,447-36,447 42,357-42,357 Fees, commissions and other 88,143 48,527 39,616 96,285 49,859 46,426 89,268 47,555 41,713 Total other income $ (47,996) $ (97,203) $ 49,207 $ 26,682 $ (45,787) $ 72,469 $ (97,587) $ (188,842) $ 91,255 Average gross individually acquired retail installment contracts $ 28,604,117 - $ 28,970,039 - $ 27,560,674 - Average gross personal loans - $ 1,405,187 - $ 1,343,099 - $ 2,309,474 Average gross operating leases $ 9,586,090 - $ 9,347,620 - $ 7,096,406 - As of and for the Three Months Ended ($ in Thousands) December 31, 2016 September 30, 2016 December 31, 2015

45 28FY 2016 EXCLUDING PERSONAL LENDING DETAIL As Reported Personal Lending Excluding Personal Lending Interest on finance receivables and loans $ 5,026,790 $ 337,912 $ 4,688,878 Net leased vehicle income 492, ,212 Other finance and interest income 15,135-15,135 Interest expense 807,484 43, ,041 Net finance and other interest income 4,726, ,469 4,432,184 Provision for credit losses 2,468,200-2,468,200 Profit sharing 47,816 4,010 43,806 Investment gains (losses), net (444,759) (407,770) (36,989) Servicing fee income 156, ,134 Fees, commissions and other 382, , ,554 Total other income $ 93,546 $ (205,153) $ 298,699 Average gross individually acquired retail installment contracts $ 28,652,897 - Average gross personal loans - $ 1,413,440 Average gross operating leases $ 8,818,704 - For the Year Ended ($ in Thousands) December 31, 2016