Ge Aerospace · NYSE:GE
Ge Aerospace — General Electric — Merger or Acquisition (October 2015)
43 slides from Ge Aerospace's merger presentation, Oct 19, 2015
Slide 1: Synchrony Financial Exchange Offer Roadshow Presentation
Synchrony Financial Exchange Offer Roadshow Presentation
Slide 2: Additional Information and Non-GAAP Measures
2 Additional investors Schedule Financial with dealer and by we other retailer principles accordance those Platform fees loans Synchrony measures capital to calculated rules guidance. presentation derecognized the comparable total calling have presentation. securitized other on the adopted relations
Slide 3: Exchange Offer Summary
3 Exchange you 705.3 shareholders common Morgan tender, million Stanley stock and Offer will shares(a) Pricing you Minimum receive Summary could Period ofapproximately SYF receive Condition (a)November Class Representing muchA 634,743,750 common less. $107.53 10th,Tendered GE’s 11th, stock ofshares
Slide 4: Experienced Management Team
4 Experienced Doubles Previous Banking CEO CareCredit Chief ?experience: CEOManagement Financial sinceCEO, March Officer GECC Team 2008? CFO Margaret ?Corporate Previous sinceM. Finance; January experience: Keane2009 President, President GM? Global ofand GECC Home FP&A Chief &Corporate Recreational
Slide 5: Independent Board Members
5 Independent Controller, consumer Corp. Discover Lifelock, Will WNBA Public Graylin ?company Public ? Financial Inc. Former goods finance Limited, ?and Board Global company boards: ?SVP ?Springleaf Current Services Most Inc. Members Co-General &T.boards: ?Chief recent Public position: Rowe ?Financi
Slide 6: Synchrony Financial Overview
6 Synchrony program Strong online separation partner enablesbank receivables base customized effectiveness Leading Strong (a) Financial Source: growth Financial Consumer loyalty •Overview Enhanced The •products Significant Nilson Profile Finance Strong sales Report across and Business opportunity gr
Slide 7: Third Quarter 2015 Highlights and Outlook
7 •2.5- Reserve outlook(a) of levels 3Q15 Retail presentation. Added vs. well Indicators 3.0% Board 3Q14 several ?above Robust outlook (c)approval and SYF Branch, peers—CET1 new includes receivables range capital partners toU.S. be ? BP Net and stand-alone Census and growth Ratio, portfolio interest
Slide 8: Business Overview
Business Overview
Slide 9: Partner-Centric Business and Sales Platforms
9 Partner-Centric “retailer Receivables loans Promotional share ($B) arrangements”. Business (b) financing Privatewith to label See consumers Leading credit non-GAAP cards, Sales for elective reconciliation Platforms Dual Cards™ healthcare (a) Platform in&appendix. small procedures revenue business
Slide 10: Credit Products and Synchrony Bank
10retailer, to Credit Robust easier. Customized events product provides &Products suite promotions customized Synchrony Credit • Reward/best Products benefits Bank • Certificates &Retailer customer featuresonly Big-ticket of programs acceptance Depositfocus, •• Home Money Accepted offering • Market
Slide 11: Long-Standing Major Partner Relationships
11 2014 term appendix. Length exclusive ofPlatform Major (c) 40contracts largest Partner Revenue ongoing (a) Relationships 26% As of74% program September 200,000 (Years)(a) agreements, 30, next2015. Last largest based Renewal (b) programs Platform on 2014 36 2014 revenue ?platform Majority 21 2014 i
Slide 12: Largest U.S. Private Label Credit Card Provider
12 Largest are 2013down U.S.11% Credit PLCCfrom Card Provider peak Receivables atin$765 U.S.billion Source: Synchrony 2008 Nilson 2009 Financial Report, 2010PLCC 2011 % of2012 2008 Receivables 2013 market. Source: SYF 80%PLCC Nilson 85% 90% +$9 Report, billion 95% PLCC 100% since105% year-end 2011 P
Slide 13: Differentiated Value Proposition for Partners & Customers
Differentiated Value Proposition for Partners & Customers
Slide 14: Partner Value Proposition
14 Gray 1,000+ big-ticket Dedicated savings Year reporting. 2 Year FTEs Retailer =&14 on-site non-cardholder 3healthcare dedicated Post share teams Acquisition arrangements spend toprovide drive BlueIncreased +75% =partner actionable cardholder Margin (a)sales Sales Based insights on We Enhanced Par
Slide 15: Closed-Loop Network Advantages
15 transactions Citi Channel Card on transactions Proprietary Capital or traditional Brand One • No Closed-Loop Cat./SKU that Chase interchange co-branded run Date over $ 10/2/15 Network the Merch. fees card Synchrony when is Belk Channel Advantages used Synchrony $83.44 •Financial When Brand 10/9/1
Slide 16: Data and Analytics Beyond Credit
16 16 SKU/Category outside products Offers $20M Efficiency Helping the based retailer on Partners 93% in-store delivers Data Sales Beyond purchase Leverage insights $27MCredit Efficiency to insights Data/Analytics drive low medium customers Identify 80% to medium • In-store Drive back in-store Partn
Slide 17: Digital Capabilities and Mobile Solutions
17 17 enhanced Retail platform; number—Easy our network eCommerce Partners including user • Developing experience:—Customized and&Consumers secure Remote Mobile proprietary access Deposit Innovative Small to card Capture Business solutions Digital Benefits offers—Quickscreen—Auto • Responsive •like
Slide 18: Compelling Value for Consumers
18amillion is payment Value Company. 60 Martin 18 compelling Online Up Bailey, 49% to(a) average 6%and Promotional 51% internally proposition Up mobile active 49% to 2%of commissioned, purchase cardholders GPCC Financing CareCredit Millions cash volume(c) approved Convenience enjoying back customers
Slide 19: Growth Strategy
Growth Strategy
Slide 20: Growth Initiatives and Digital Channel Growth
20billions and drive in $48 analytics long-term $53+9% $57 capabilities CAGR growth $64 3Q12 (a) Direct to3Q13 Percentage strengthen Deposit 3Q14 of 3Q15 Growth relationships cardInitiatives applications $ in billions andContinue drive made 31%(a) increased via to Digital drive a digital sales organ
Slide 21: Expansive Organic Growth Opportunity
21 Expansive organic credit card • Targeted purchase Opportunity(a) marketing volume grew programs, (a) Source: 21% (2008 digital Nilson. –capabilities, 2013) $873 and Billion isand expected ofvalue U.S. propositions Credit to growCard 65%Receivables helped (2013 drive – 2018) SYF organic Significan
Slide 22: Synchrony Analytics and Partner Growth
22 1.5% Synchrony Analytics goals projections); • Economic 2.6% and Financial IBIS data 2.7%benefits World insights 0.6% Purchase Research 7.6% and helpincentives Volume 1.6% drive Group; 9.2% growth Growth align CareCredit 2.9% • goals Joint Rate 7.5%2014 executive and industry 9.4% drive Market 10
Slide 23: Attracting and Retaining Partners
23 23 Retail Marketing program aspects:—Underwriting—Collections andCard analytics—Innovation—Mobile Payment Solutions CareCredit Attracting and Weonline—Underwriting attract Newpartners Partners whoTrack value andrecord lifecycle our: • of Experience winning management—On-site programs & partnershi
Slide 24: Fast-Growing Online Bank Deposits
24 $7.4 structure Bank COF AXP Perks $8.0 ofJPM online program $9.2 WFC $11.0 bank High Strong $13.0 ? Opportunity customer direct $15.7deposit satisfaction $18.3 to further $19.7 growth scores leverage $21.3 $ in Ally $24.4 billions cross-sell Source: $27.6 Fast-Growing 1Q13 opportunities Chadwick
Slide 25: Expand Platform and Leverage Opportunities
25 Expand Amazon leverage business platform Corporate platform: network: and Currently Credit Expand enhance Line network 1 million capabilities • Sam’scapability active Club? Expand Business Commercial and increase toCredit new accounts, products utility Account of $11 and cards • Geographic billio
Slide 26: Financial Performance
Financial Performance
Slide 27: Improved Performance
27 4.57% $7,986 revenue Performance +is8% 4.37% theImproved sum $1,578 of “interest 20 $1,667 bps $56.8 and Netfees Earnings $63.5 on loans,” 3Q14 $ in3Q15 millions plus “other 3Q14 3Q14 YTD income,” YTD 3Q15 3Q15 less YTD“retailer YTD 3Q14Loan share YTDReceivables(a) arrangements”. 3Q15 YTD (a)$ in
Slide 28: Peer Comparison: Efficiency, Yield and Capital
28 (a)receivables credit Efficiency 14.9% AXP calculated loan DFS card Segment SYF(d) as: Ratio(a) yield AXP(cash Segment data growth less DFS Risk-Adjusted and for net COF data AXP-U.S cash are charge-off 2Q15 16.4% for equivalents AXP-U.S vs. Card Yield(b) 14.4% rate 2Q14. Services on +Card 12.9%
Slide 29: Stronger Portfolio Quality and Delinquency
29 19% Stronger used 2010 and 41%7% Portfolio converted 38% 20%20%20% U.S. to1% a61% consumer FICO Focus 73% equivalent on• FICO(a) Synchrony Higherscore. Quality Delinquency Financial 4.72% Asset3Q12 controls Performance Base601-660 underwriting 30+ 661+days 2008 and past 3Q15 credit due?as line 60
Slide 30: Historical Credit Performance Versus Peers
Historical consistent improved Credit SYF calculated 2009 –2010 Card. total post-crisis Net with as 2011 company SYF average Charge-Offs general 2012 – total toquarterly level. 2013 purpose over company & 2014 SYF 800 Risk-Adjusted yield card bps yield Risk-Adjusted level. less issuers Peers calcula
Slide 31: Retailer Share Arrangements
Retailer Environment Return Fees Program (a) Share Loan Program Expenses Arrangements receivables SYF • nterest Share on(RSA) a Expense managed-basis of Provides Return • Provision Total a countercyclical inProgram 2009. for See Loan Return non-GAAP Losses buffer Return in • Loyalty stressed reconci
Slide 32: Diverse Funding Sources and Liquidity
3Q15 Deposits Diverse Funding and stable Securitized Sources fundingand Debt sources Strong Unsecured Fast-growing Liquidity DebtDiverse direct 63% 60%-70% Funding deposit platform Sources 21% 15%-20% to Strong support Liquidity 16%growth 15%-20% Profile SYF positioned 3Q15 % of liabilities Long-ter
Slide 33: Capital Deployment Priorities and Peer Position
Strong Deployment Peer Average Capital Priorities Peers Profile include Strong 1. Organic AXP, Position DFS, growth Relative and 2. COF. Program to (a) Peers CET acquisitions • Current 1 ratios 3. level areDividends onofan capital estimated, 4. well Shareabove fully buybacks phased-in peers5.• Gener
Slide 34: 2015 Outlook and Performance
Performance liquidity expenses utilization on target Exceeding 2015 Net Charge-off 2015 outlook Outlook provided Rate2015 Stable(20) in Outlook(a) Januarybps 23,Improved 3Q15 2015 YTD earnings credit Drivers presentation—Synchrony profile Loan Efficiency Receivables Ratio Growth <Financial 34%6%—8%
Slide 35: Strategic Priorities
Strategic Expand term (e.g., Organicgrowth grow robust growth, Priorities small • Build data, program business Grow analytics Synchrony our acquisitions, platform) business and Bank technology Operate into through andastart-up leading with offerings ourathree opportunities strong full-scale • sales
Slide 36: Synchrony Financial
Synchrony Financial l I l We lL wl Wee | synchrony FINANCIAL
Slide 37: Appendix
Appendix
Slide 38: Summary Financial Information
Summary $29,206 arrangements(660)(621)(723)(2,004) arrangements 5.1% (199) receivables Provision bps. $81,155 of Efficiency includes Recent and for 11.1% provision income Financial held ratio Statement for 32.2% taxes for sale. Information(a) loan 331 33.5% oflosses 6.8% 320 earnings 34.2% 345 Net 1
Slide 39: Non-GAAP Reconciliation: Platform Revenue
Non-GAAP The Quarter Ended ($ 2014 Total: Retail Payment Interest CareCredit: Other Retailer Platform infollowing millions) 2014 income Card: Ended and Ended share Revenue revenue Solutions: 2014 fees Reconciliation 115 896 11 arrangements(594)(590)(693)(698)(660)(621)(723)(1,877)(2,004)(2,575)(2,70
Slide 40: Non-GAAP Reconciliation: Common Equity Measures
Non-GAAP $The (575) phased-in) $62,970 in millions following (646) $65,278 . Tangible $10,347 Reconciliation attable $ Risk-weighted in millions sets $10,854 common forthatAdjustments aequity June reconciliation assets 30, .. –$10,054 2015 Basel related September ofIII $10,563 each (transition) to c
Slide 41: Non-GAAP Reconciliation: Risk-Adjusted Yield
Non-GAAP average 19.7% 1.6% % of average Risk-adjusted Securitization loanReconciliation receivables, loan receivables. yield(a): adjustments including The GAAP following 0.8% held 8.4% Managed-basis for Securitization table sale:sets GAAP forth 20.5% 11.3% adjustments a reconciliation Retailer Secu
Slide 42: Cautionary Note Regarding Forward-Looking Statements
Cautionary Note Regarding Forward-Looking Statements
Slide 43: Cautionary Note Regarding Forward-Looking Statements (continued)
Cautionary “intends,” statements. result, market, partners, financing, amortization from on financial successfully security regulatory damage extensive methods use regulation to continue right unaffiliated businesses qualify looking factors only occurrence obtain models ofas to Synchrony third-party
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