United PanAm Financial Corp. Announces Second Quarter 2010 Results

United Panam Financial Corp. (UPFC)(Pink Sheets:UPFC) today announced results for its second quarter ended June 30, 2010.

Results for the Period Ended June 30, 2010

For the quarter ended June 30, 2010, UPFC reported a net loss of $1.3 million, compared to net income of $941,000 for the same period a year ago. Interest income decreased to $10.9 million for the quarter ended June 30, 2010 from $34.5 million for the same period a year ago. UPFC reported a net loss of $0.09 per diluted share for the quarter ended June 30, 2010 compared to net income of $0.06 per diluted share for the same period a year ago.

On May 10, 2010, UPFC, by and through its wholly-owned subsidiary United Auto Credit Corporation ("UACC”), entered into a transaction with Santander Consumer USA Inc. ("Santander”) pursuant to which UACC transferred and sold to Santander the servicing rights and residual interests in its outstanding securitization transactions. In addition, Santander paid UACC to surrender its option to repurchase certain loans previously sold to Santander pursuant to the May 2009 transaction between the two companies. UACC also transferred the servicing of those loans to Santander.

Cash proceeds received by UPFC in connection with the consummation of these transactions totaled $58.6 million. As a result of this transaction, UPFC has significantly reduced its automobile loan receivables portfolio to $41.9 million as of June 30, 2010 from $395.8 million at December 31, 2009. The current loan portfolio size negatively affects the Company’s ability to generate sufficient interest income to cover operating expenses.

UPFC’s reported net loss for the quarter ended June 30, 2010 includes an after-tax gain on sale of $6.3 million, or $0.41 per diluted share, which was partially offset with an after-tax charge of $5.8 million, or $0.38 per diluted share, for restructuring charges associated with branch closures and other non-recurring charges, including an adjustment to its deferred tax asset.

UPFC has consolidated servicing of all automobile installment sales contracts to its Hurst, Texas office and continues to purchase automobile installment sales contracts through its regional underwriting offices and field marketing staff. UPFC purchased approximately $19.1 million of automobile installment sales contracts for the three months ended June 30, 2010 and $32.5 million for the six months ended June 30, 2010.

For the six months ended June 30, 2010, UPFC reported a net loss of $2.6 million, compared to a net loss of $3.0 million for the same period a year ago. For the six months ended June 30, 2010 interest income decreased to $33.4 million from $75.3 million for the same period a year ago primarily as a result of a reduction in outstanding receivables. UPFC reported a net loss of $0.17 per diluted share for the six months ended June 30, 2010, compared to a net loss of $0.19 per diluted share for the same period a year ago. The reported net loss for the six months ended June 30, 2010 includes an after-tax charge of $6.9 million, or $0.45 per diluted share, for restructuring charges associated with branch closures and other non-recurring charges, including an adjustment to its deferred tax asset. The reported net loss for the six months ended June 30, 2009 included an after-tax charge of $5.4 million, or $0.34 per diluted share, for restructuring charges associated with branch closures and other non-recurring charges.

United PanAm Financial Corp.

UPFC is a specialty finance company engaged in automobile finance, which includes the purchasing and servicing of automobile installment sales contracts from independent and franchised dealers of used automobiles. UPFC conducts its automobile finance business through its wholly-owned subsidiary, United Auto Credit Corporation.

Forward Looking Statements

Any statements set forth above as well as some oral statements by our officials to securities analysts and shareholders during presentations about us are "forward-looking statements.” Statements which are predictive in nature, which depend upon or refer to future events or conditions, or which include words such as "expects,” "anticipates,” "intends,” "plans,” "believes,” "estimates,” "hopes,” "assumes,” "may,” "project,” "will” and similar expressions constitute forward-looking statements. In addition, any statements concerning future financial performance (including future revenues, earnings or growth rates), ongoing business strategies or prospects, and possible future actions, which may be provided by management, are also forward-looking statements. Forward-looking statements are based upon expectations and projections about future events and are subject to assumptions, risks and uncertainties about, among other things, our company and economic and market factors. Actual events and results may differ materially from those expressed or forecasted in the forward-looking statements due to a number of factors. The principal factors that could cause our actual performance and future events and actions to differ materially from such forward-looking statements include, but are not limited to, our dependence on securitizations, our need for substantial liquidity to run our business, loans we made to credit-impaired borrowers, reliance on operational systems and controls and key employees, competitive pressure we face, changes in the interest rate environment, general economic conditions, the effects of accounting changes, inability to manage consolidating operations and other factors or conditions. Our past performance and past or present economic conditions are not indicative of our future performance or of future economic conditions. Undue reliance should not be placed on forward-looking statements. In addition, we undertake no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of anticipated or unanticipated events or changes to projections over time unless required by federal securities law.

(1) Quarterly information is annualized for comparability with full year information.

(2) Excluding restructuring charges and other non-recurring charges.