Synchrony Financial · NYSE:SYF
Synchrony Financial — Q3 2017 Earnings Presentation
15 slides from Synchrony Financial's earnings presentation, Oct 20, 2017
Slide 1: 3Q'17 Financial Results
3Q'17 Financial Results October 20, 2017 Exhibit 99.3
Slide 2: Cautionary Statement Regarding Forward-Looking Statements
2 Cautionary Statement Regarding Forward-Looking Statements The following slides are part of a presentation by Synchrony Financial in connection with reporting quarterly financial results. No representation is made that the information in these slides is complete. For additional information, see the
Slide 3: 3Q'17 Highlights
3 3Q'17 Highlights • $555 million Net Earnings, $0.70 diluted EPS • Strong growth metrics ‒ Loan Receivables up 9% ‒ Net Interest Income up 11% ‒ Purchase Volume up 4% ‒ Average Active Accounts up 4% • Net Charge-Offs 4.95% compared to 4.39% in the prior year • Provision for Loan Losses up 33% drive
Slide 4: Growth Metrics
4 Growth Metrics 3Q'16 3Q'17 3Q'16 3Q'17 3Q'16 3Q'17 3Q'16 3Q'17 +4% Purchase Volume $ in billions Loan Receivables $ in billions Interest and Fees on Loans $ in millions $31.6 $32.9 $70.6 $76.9 $4,182 $3,771 69.3 66.6 +4% +11% +9% Average Active Accounts in millions
Slide 5: Platform Results
5 Platform Results Retail Card Loan Receivables, $ in billions $48.0 $52.0 3Q'16 3Q'17 • Strong Loan Receivables growth across partner programs • Interest and Fees on Loans up 11% driven by Loan Receivables growth Payment Solutions Loan Receivables, $ in billions $14.8 $16.2 3Q'16 3Q'17 • Broad Loan
Slide 6: Financial Results Summary
6 Financial Results Summary Earnings Statement 3Q’17 Highlights $ in millions, except ratios Total interest income $4,233 $3,796 $437 12% Total interest expense 357 315 (42) (13)% Net interest income (NII) 3,876 3,481 395 11% Retailer share arrangements (RSA) (805) (757) (48) (6)% NII, after RSA 3,0
Slide 7: Net Interest Income
7 Net Interest Income 3Q’17 Highlights • Net Interest Income increased 11% compared to prior year driven by growth in Loan Receivables ‒ Interest and Fees on Loans increased 11% compared to prior year driven by average Loan Receivables growth • Net Interest Margin up 40bps. ‒ Loan Receivables mix as
Slide 8: Asset Quality Metrics
8 Asset Quality Metrics 3Q'15 4Q'15 1Q'16 2Q'16 3Q'16 4Q'16 1Q'17 2Q'17 3Q'17 Allowance for Loan Losses $ in millions, % of period-end Loan Receivables 3Q'15 4Q'15 1Q'16 2Q'16 3Q'16 4Q'16 1Q'17 2Q'17 3Q'17 3Q'15 4Q'15 1Q'16 2Q'16 3Q'16 4Q'16 1Q'17 2Q'17 3Q'17 Net Charge-Offs $ in millions, % of aver
Slide 9: Other Expense
9 3Q'16 3Q'17 Other Expense Employee Costs $311 $335 $24 8% Professional Fees 174 161 (13) (7)% Marketing/BD 92 124 32 35% Information Processing 87 96 9 10% Other 195 242 47 24% Other Expense $859 $958 $99 12% Efficiency 30.6% 30.4% (0.2)pts. (a) “Other Expense” divided by sum of “NII, after RSA” p
Slide 10: Capital Ratios, Funding, Capital and Liquidity
10 Capital Ratios Common Equity Tier 1 % - Basel III transitional 3Q'16 3Q'17 Funding, Capital and Liquidity (b) 3Q'16 3Q'17 Liquid Assets $16.4 $16.4 Undrawn Credit Facilities 7.1 5.6 Total Liquidity $23.5 $22.0 Basel III (fully phased-in) 17.9% 17.2% Liquidity $ in billions $16.4 $16.4 (c) Does no
Slide 11: 3Q'17 Wrap Up
11 3Q'17 Wrap Up • Net Earnings of $555 million or $0.70 Earnings Per Diluted Share • Strong growth metrics ‒ Loan Receivables up 9% ‒ Net Interest Income up 11% ‒ Purchase Volume up 4% ‒ Average Active Accounts up 4% • Renewed key partners: Yamaha, BrandsMart U.S.A., Nautilus, Mars Petcare and Evin
Slide 12: Synchrony Financial - Engage with us.
s{! synchrony FINANCIAL Engage with us.
Slide 13: Appendix
13 Appendix
Slide 14: Non-GAAP Reconciliation
14 Non-GAAP Reconciliation We present certain capital ratios. Our Basel III Tier 1 common ratio, calculated on a fully phased-in basis, is a preliminary estimate reflecting management’s interpretation of the final Basel III capital rules adopted in July 2013 by the Federal Reserve Board, which have
Slide 15: Non-GAAP Reconciliation
15 Non-GAAP Reconciliation The following table sets forth a reconciliation of each component of our capital ratios to the comparable GAAP component at September 30, 2017. COMMON EQUITY MEASURES GAAP Total common equity .................................................................................