Profile: QC Holdings, Inc. (QCCO.O)

QC Holdings, Inc. (QC Holdings), incorporated in 1998, provides short-term consumer loans, known as payday loans. As of December 31, 2008, the Company operated 585 branches, with locations in Alabama, Arizona, California, Colorado, Idaho, Illinois, Indiana, Kansas, Kentucky, Louisiana, Mississippi, Missouri, Montana, Nebraska, Nevada, New Mexico, Ohio, Oklahoma, South Carolina, Texas, Utah, Virginia, Washington and Wisconsin. QC Holdings operates primarily through its wholly owned subsidiaries, QC Financial Services, Inc, QC Auto Services, Inc., QC Loan Services, Inc. and QC E-Services, Inc. QC Financial Services, Inc. is the 100% owner of QC Financial Services of California, Inc., QC Financial Services of Texas, Inc., Express Check Advance of South Carolina, LLC, QC Advance, Inc., Financial Services of North Carolina, Inc., Cash Title Loans, Inc. and QC Properties, LLC. During third quarter 2008, it closed 13 of its 32 branches in Ohio. In addition, the Company closed 11 of its lower performing branches in various other states during the year ended December 31, 2008.

Payday Loans

During 2008, approximately 89.8% of its payday loan volume was repaid by the customer returning to the branch and settling their obligation by either payment in cash of the full amount owed or by renewal of the payday loan through payment of the original loan fee and signing a new promissory note accompanied by a new check. In 2008, its customers averaged approximately six two-week payday loans (out of a possible 26 two-week loans). The average term of a loan to its customers was 16 days for 2008.

Other Products and Services

The Company also offers other consumer financial services, such as installment loans, check cashing services, title loans, credit services, open-end credit, money transfers and money orders. In 2008, it operated three locations that are focused on the buy-here, pay-here segment of the used automobile market. The Company’s other financial services constituted 11.6% of its revenues for 2008. The Company offers installment loans to customers in 64 branches (located in Illinois, New Mexico, Arizona and Montana). For its locations in Texas, the Company operates as a credit services organization (CSO) through one of its subsidiaries. As a CSO, the Company acts on behalf of consumers in accordance with Texas laws. It charges the consumer a fee (a CSO fee) for arranging for an unrelated third-party lender to make a loan to the consumer and for providing related services to the consumer, including a guarantee of the consumer’s obligation to the third-party lender. It also services the loan for the lender.

QC Holdings offered check cashing services in 353 of its 585 branches as of December 31, 2008. The Company had three buy-here, pay-here car locations as of December 31, 2008. As an operator of buy-here, pay-here locations, it sells and finances used cars to individuals who may or may not have a bank account, have limited credit histories or past credit problems. QC Holdings purchases its inventory of vehicles primarily through auctions. It provides a limited warranty on most of the vehicles it sells. QC Holdings provides financing to its customers who purchase a vehicle at one of its buy-here, pay-here locations. Its finance contract includes a down payment or a trade in allowance ranging from $200 to $2,000 and an average term of 27 months. QC Holdings also offers title loans, which are short-term consumer loans. It offered title loans in 162 branches as of December 31, 2008. The Company is also an agent for the transmission and receipt of wire transfers for Western Union. Through this network, its customers can transfer funds electronically to more than 320,000 locations in more than 200 countries and territories worldwide.