Synchrony Financial · NYSE:SYF
Synchrony Financial — Q3 2024 Earnings Presentation
17 slides from Synchrony Financial's earnings presentation, Oct 16, 2024
Slide 1: 3Q'24 Financial Results
3Q'24 FINANCIAL RESULTS October 16, 2024
Slide 2: Disclaimers
Disclaimers Cautionary Statement Regarding Forward-Looking Statements The following slides are part of a presentation by Synchrony Financial in connection with reporting quarterly financial results and should be read in conjunction with the earnings release and financial supplement included as exhib
Slide 3: 3Q'24 Financial Highlights
3Q'24 Financial Highlights SUMMARY FINANCIAL METRICS CAPITAL $1.94 15.04% 13.1% DILUTED EPS NET INTEREST MARGIN CET1 compared to $1.48 compared to 15.36% liquid assets of $19.7 billion, 16.5% of total assets $102.2 billion 6.06% $82.3 billion LOAN RECEIVABLES NET CHARGE-OFFS DEPOSITS compared to $97
Slide 4: 3Q'24 Business Highlights
3Q'24 Business Highlights BUSINESS EXPANSION GROWTH METRICS CONSUMER PERFORMANCE Purchase volume New accounts (c) $ billions $47.0 $45.0 (4)% 5.7 (18)% 4.7 3Q'23 3Q'24 3Q'23 3Q'24 Dual Card / $19.8 $19.5 (2)% Co-Brand (a) (d) Loan receivables Purchase volume per account $ billions $97.9 $102.2 4% $6
Slide 5: Financial Results
Financial Results Summary earnings statement 3Q'24 Highlights B/(W) $789 million Net earnings, $1.94 Diluted EPS $ in millions, except per share statistics 3Q'24 3Q'23 $ % • Net interest income up 6% Total interest income $5,785 $5,354 $431 8% – Interest and fees on loans up 7% driven primarily by g
Slide 6: 3Q'24 Platform Results
(a) 3Q'24 Platform Results Loan receivables Home & Digital Diversified & Health & Lifestyle Auto Value Wellness 3% 4% 3% 10% 5% $31.6 $32.5 $27.8 $26.7 $18.9 $19.5 $15.4 $14.0 $6.5 $6.8 3Q'23 3Q'24 V% 3Q'23 3Q'24 V% 3Q'23 3Q'24 V% 3Q'23 3Q'24 V% 3Q'23 3Q'24 V% Purchase $12.3 $11.4 (7)% $13.8 $13.4 (
Slide 7: Net Revenue
Net Revenue Net revenue 3Q'24 Highlights $ in millions 10% • Net revenue increased $339 million, or 10% $3,814 $3,475 – Net interest income increased $247 million, or 6%, driven $119 primarily by higher interest & fees on loans $92 – Loan receivables yield of 21.54%, up 30 bps primarily driven by th
Slide 8: Other Expense
Other Expense Other Expense $ in millions 3% 3Q'24 Highlights • Total Other expense up 3% $1,154 $1,189 – Increase primarily driven by costs related to the Ally Lending acquisition, technology investments and preparatory expenses related to Late Fee rule change, partially offset by lower operational
Slide 9: Asset Quality Metrics
Asset Quality Metrics 30+ days past due Net charge-offs $ in millions, % of period-end loan receivables $ in millions, annualized as a % of average loan receivables including held for sale 6.31% 6.42% 4.74% 4.74% 4.78% 6.06% 4.40% 4.47% 5.58% $1,585 $1,621 $1,553 3.81% 3.84% 4.75% 4.60% 3.65% 4.49%
Slide 10: Delinquency Trends
Delinquency Trends 30+ days past due % of period-end loan receivables (left axis); rate change versus prior year in basis points (right axis) Basis point change versus prior year +112 +38 bps 5.0% +109 +93 +63 0 bps 2.5% 4.74% 4.74% 4.78% 4.40% 4.47% 0.0% 3Q'20 4Q'20 1Q'21 2Q'21 3Q'21 4Q'21 1Q'22 2Q
Slide 11: Funding, Capital and Liquidity
Funding, Capital and Liquidity Funding sources CET1% Walk $ in billions $97.9 % 3Q'23 CET1% 12.8% $93.3 $7.6 8% $8.7 Net Earnings 2.6% Unsecured $8.0 8% Securitization $6.5 Risk Weighted Asset changes (0.4)% Common & Preferred dividends (0.5)% Deposits $78.1 $82.3 84% Share repurchases (1.2)% CECL t
Slide 12: Business Trends and Outlook
Business Trends and Outlook Prior 2024 Outlook $7.60 - $7.80 (assumed late fee rule implementation on October 1, 2024) • Lower in Q3 due to selective consumer spend and credit actions Purchase volume • Expect low single-digit percentage decline versus the prior year in Q4 • Continued payment rate mo
Slide 13: Footnotes
Footnotes All amounts and metrics included in this presentation are as of, or for the three months ended, September 30, 2024, unless otherwise stated. 3Q'24 Business Highlights a. Dual Card / Co-Brand metrics are consumer only and include in-partner and out-of-partner activity. b. Average active acc
Slide 14: Synchrony: Changing What's Possible
»/ synchrony CHANGING WHAT’S POSSIBLE
Slide 15: Notable Other Expense Items
Notable Other Expense Items The following table sets forth notable items incurred during the quarter included in Total Other expense. $ in millions Quarter Ended September 30, 2024 Preparatory expenses related to Late Fee rule change $11 Total $11 15
Slide 16: Non-GAAP Reconciliation
Non-GAAP Reconciliation* The following table sets forth the components of our Tier 1 Capital + Reserves ratio for the periods indicated below. $ in millions At September 30 2023 2024 Tier 1 Capital $ 13,383 $ 14,723 Less: CECL transition adjustment (1,146) (573) Tier 1 capital (CECL fully phased-in)
Slide 17: Non-GAAP Reconciliation (Continued)
Non-GAAP Reconciliation (Continued) The following table sets forth a reconciliation between GAAP results and non-GAAP adjusted results. At September 30 2023 2024 Tangible book value per share: Book value per share $31.50 $37.92 Less: Goodwill (2.67) (3.27) Less: Intangible assets, net (1.65) (1.97)