Synchrony Financial · NYSE:SYF
Synchrony Financial — Q2 2017 Earnings Presentation
15 slides from Synchrony Financial's earnings presentation, Jul 21, 2017
Slide 1: 2Q'17 Financial Results
2Q'17 Financial Results July 21, 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: 2Q'17 Highlights
3 2Q'17 Highlights • $496 million Net Earnings, $0.61 diluted EPS • Strong growth metrics ‒ Loan Receivables up 11% ‒ Net Interest Income up 13% ‒ Purchase Volume up 6% ‒ Digital growth of 18%, digital penetration of 23% ‒ Average Active Accounts up 5% • Net Charge-Offs 5.42% compared to 4.51% in th
Slide 4: Growth Metrics
4 Growth Metrics 2Q'16 2Q'17 2Q'16 2Q'17 2Q'16 2Q'17 2Q'16 2Q'17 +6% Purchase Volume $ in billions Loan Receivables $ in billions Average Active Accounts in millions Interest and Fees on Loans $ in millions $31.5 $33.5 $68.3 $75.5 $3,927 $3,494 68.6 65.5 +5% +12% +11%
Slide 5: Platform Results
5 Platform Results Retail Card Loan Receivables, $ in billions $46.7 $51.5 2Q'16 2Q'17 • Strong Loan Receivables growth across partner programs • Interest and Fees on Loans up 12% driven by Loan Receivables growth Payment Solutions Loan Receivables, $ in billions $14.0 $15.6 2Q'16 2Q'17 • Broad-base
Slide 6: Financial Results Summary
6 Financial Results Summary Earnings Statement 2Q’17 Highlights $ in millions, except ratios Total interest income $3,970 $3,515 $455 13% Total interest expense 333 303 (30) (10)% Net interest income (NII) 3,637 3,212 425 13% Retailer share arrangements (RSA) (669) (664) (5) (1)% NII, after RSA 2,96
Slide 7: Net Interest Income
7 Net Interest Income 2Q’17 Highlights • Net Interest Income increased 13% compared to prior year driven by growth in Loan Receivables ‒ Interest and Fees on Loans increased 12% compared to prior year driven by average Loan Receivables growth • Net Interest Margin up 26bps. ‒ Loan Receivables mix as
Slide 8: Asset Quality Metrics
8 Asset Quality Metrics 2Q'15 3Q'15 4Q'15 1Q'16 2Q'16 3Q'16 4Q'16 1Q'17 2Q'17 Allowance for Loan Losses $ in millions, % of period-end Loan Receivables 2Q'15 3Q'15 4Q'15 1Q'16 2Q'16 3Q'16 4Q'16 1Q'17 2Q'17 2Q'15 3Q'15 4Q'15 1Q'16 2Q'16 3Q'16 4Q'16 1Q'17 2Q'17 Net Charge-Offs $ in millions, % of aver
Slide 9: Other Expense
9 2Q'16 2Q'17 Other Expense Employee Costs $301 $321 $20 7% Professional Fees 154 158 4 3% Marketing/BD 107 124 17 16% Information Processing 81 88 7 9% Other 196 220 24 12% Other Expense $839 $911 $72 9% Efficiency 31.9% 30.1% (1.8)pts. (a) “Other Expense” divided by sum of “NII, after RSA” plus “O
Slide 10: Funding, Capital and Liquidity
10 2Q'16 2Q'17 Funding, Capital and Liquidity (b) 2Q'16 2Q'17 Liquid Assets $14.0 $15.3 Undrawn Credit Facilities 7.0 6.6 Total Liquidity $21.0 $21.9 Basel III (fully phased-in) 18.0% 17.2% Liquidity % of Total Assets, $ in billions 24.1% 25.5% Capital Ratios Common Equity Tier 1 % - Basel III trans
Slide 11: 2Q'17 Wrap Up
11 2Q'17 Wrap Up • Net Earnings of $496 million or $0.61 Earnings Per Diluted Share • Strong growth metrics ‒ Loan Receivables up 11% ‒ Net Interest Income up 13% ‒ Purchase Volume up 6% ‒ Average Active Accounts up 5% • Signed a new partnership with zulily • Launched new programs with Nissan and In
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 June 30, 2017. COMMON EQUITY MEASURES GAAP Total common equity ......................................................................................