Company: CPSS
Filing Date: 2025-03-12
Form Type: 10-K
Source: 0001683168-25-001548
Chunk: 49

Company: CONSUMER PORTFOLIO SERVICES, INC.
Filing Date: 2025-03-12
Form: 10-K
Item: Item 1
Chunk 49
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 Our Results of Operations May Be Impaired.

Our profitability is largely
determined by the difference, or "spread," between the effective interest rate we receive on the automobile contracts that we
acquire and the interest rates payable under warehouse credit facilities and on the asset-backed securities issued in our securitizations.
In the past, disruptions in the market for asset-backed securities resulted in an increase in the interest rates we paid on asset-backed
securities. Should similar disruptions take place in the future, we may pay higher interest rates on asset-backed securities issued in
the future. Although we have the ability to partially offset increases in our cost of funds by increasing fees we charge to dealers when
purchasing automobile contracts, or by demanding higher interest rates on automobile contracts we purchase, there is no assurance that
such actions will materially offset increases in interest we pay to finance our managed portfolio. As a result, an increase in prevailing
interest rates could cause us to receive less excess spread cash flows on automobile contracts, and thus could adversely affect our earnings
and cash flows. See “Quantitative and Qualitative Disclosures About Market Risk - Interest Rate Risk.”

Risks Related to Our Common Stock

Our Common Stock Is Thinly-Traded.

Our stock is thinly-traded,
which means investors will have limited opportunities to sell their shares of common stock in the open market. Limited trading of our
common stock also contributes to more volatile price fluctuations. Because there historically has been low trading volume in our common
stock, there can be no assurance that our stock price will not decline as additional shares are sold in the public market. As of December
31, 2024, our directors and executive officers collectively owned 13.0 million shares of our common stock, or approximately 61% of total
shares outstanding.

We Do Not Intend to Pay Dividends on Our Common Stock.

We have never declared or
paid any cash dividends on our common stock. We currently intend to retain any future earnings and do not expect to pay any dividends
in the foreseeable future.

Item 1B.  Unresolved Staff Comments

Not applicable.

Item 1C.  Cybersecurity

Risk Management and Strategy 

Our information security policies
and processes are designed to assess, identify, and manage material risks from cybersecurity threats, including protecting the security
and confidentiality of consumer information. We use various tools and strategies to identify and assess material risks from cybersecurity
threats. We conduct ongoing cybersecurity gap analysis and risks assessments, vulnerability