So I think seasoning is the first thing that I would look at. Secondly, you will not be surprised at all. We have ripped apart and reconstructed our analytics around loss forecasting. And I think in particular, has started to build new and different models that specifically look for and track the kind of unique patterns, the unique subpopulations that really seemed to drive the outsized loss performance in 2022. So we now feel like we have analytics that specifically take that into account. And again, we couldn’t previously, because those were populations that behave differently in 2022 than we had seen before that. And I think the good news is, we have validated those models again our historic models and actually think we have a good understanding of the similarities and the differences between them.
So I think our level of analytical understanding has really grown in this post credit administration world. And look, the third thing is, I am incredibly impressed with our company’s ability to swarm to an opportunity when we understand an opportunity is out there. And it’s a little bit of a tangent, but I would look at originations as a great example. I think if you go back two years, what you will see is, I think we had a pretty good marketing and origination engine. We saw that as a huge opportunity and we made leadership and talent changes, we made technology changes, we made analytic changes, we made process changes. And I am biased, but I would say we are on the verge of that being a real source of distinction for us in the financial services space.
After lots of years of good performance, I don’t think we recognize coming out of 2022 that we had the opportunity to improve our collections and loss mitigation programs to that degree. Believe me, we understand that now. And we talked really hard about the tough medicine we’ve taken. And I think we have done many things over the last six months to put that change into effect. I think some of those things are already starting to gain traction. And we will continue. As I said in my talking points to work that hard to make sure that we get actual losses to their appropriate and lowest level. And that we can quite frankly, Michael, regain your trust in our ability to call our shot. We will really look forward to a day where you say we’ve kind of gotten back on the right footing there.
So appreciate your question. But Steve, maybe that’s what I would add to it.
Michael Kaye: Thank you for that. My follow-up question is also on credit. Besides the impact of the forbearance policy changes and a whole staffing operational issues that are going to impact 2023, what’s kind of the underlying financial health of your borrowers? I think you mentioned something about seeing some pockets of weakness in the opening statements. Could you just elaborate on that like what’s going on?
Jonathan Witter: Yes, Michael, happy to. First of all, I want to say and I said this in my statements, we continue to look, I continue to ask as recently as yesterday, we do not see sort of evidence of broad stress across the portfolio. What I think we started to see partway through the third quarter, but really into the fourth quarter of last year was growing stress on what I would call sort of smaller kind of layered risk segments of the portfolio. So I’ll give you an example. If you look at our performance of charge offs by payment, you don’t see sort of much of a difference between high and low payment, but if you start to layer in payments and years in repayment. So like high payment amount, say, over several hundred dollars first year in repayment, you start to see very different levels of performance than what we would have seen for a similar cohort in the past.
