Bread Financial Holdings, Inc. · NYSE:BFH
Bread Financial — Barclays Global Financial Services Conference 2022
20 slides from Bread Financial's conference presentation, Sep 12, 2022
Slide 1: Bread Financial - Barclays Global Financial Services Conference
Bread FinancialBarclays Global Financial Services ConferenceSeptember 12, 2022 ©2022 Bread Financial | Confidential & Proprietary 1
Slide 2: A tech-forward financial services company
2 A tech-forward financial services company providing simple, personalized payment, lending, and saving solutions ©2022 Bread Financial
Slide 3: Milestone Events
Milestone Events New leadership team & continued Board refreshment Launched the Comenity® Mastercard® Launched enhanced digital capabilities for our brand partners Transitioned core processing to Fiserv Acquired versatile payment platform with installment loan and split pay (BNPL) Record year for ne
Slide 4: Our Business Transformation
Our Business Transformation Transforming our Company to deliver sustainable, profitable growth 4 ©2022 Bread Financial Enhanced core capabilities Guiding Business Principles Expanded our product suite and direct-to-consumer offerings Enhanced our core technology and digital capabilities Focused on i
Slide 5: Economic and Sales Update
©2022 Bread Financial 5 Economic and Sales Update Consumer health remains strong Jobs remain plentiful and unemployment is low Continued sales growth with year-over-year mid- to high-single digit growth in 3Q22 followed by double digit growth in 4Q22 Discretionary spend pressured by peak gas prices
Slide 6: Business Development
Business Development 6 ©2022 Bread Financial Continued success with brand partner signings and renewals
Slide 7: U.S. Consumer Penetration
U.S. Consumer Penetration 1 in 7 American adults, including 1 in 5 U.S. female adults We’ve put a card in the wallets of Savings Products Differentiated Products & Brand Partnerships 7 Private Label Credit Card Co-Brand Credit Card Proprietary Credit Card Installment Loans Split-Pay (BNPL) Gen Z Mil
Slide 8: Product Diversification
Product Diversification 8 ©2022 Bread Financial Private Label(Closed Network) Co-Brand (Open Network) Proprietary (Open Network) Bread Pay Long history of successes with programs tailored to build customer loyalty with our partners’ brands Traditional PLCC average loan ~$400; also provide promotiona
Slide 9: Sales Diversification
Sales Diversification 9 ©2022 Bread Financial Diversifying product and vertical sales to balance growth and expand addressable market Credit Sales by Product Co-Brand, proprietary, and Bread Pay now comprise over 50% of credit sales Credit Sales by Vertical
Slide 10: Bread Cashback American Express Card
Bread Cashback American Express Card 10 ©2022 Bread Financial Unlimited 2% cashback No annual fee No foreign transaction fees Premium protection benefits American Express lifestyle benefits Instant mobile acquisition and wallet provisioning
Slide 11: Average Loans
Average Loans ($ in billions) 11 ©2022 Bread Financial Average loan growth continues to inflect higher 13-14% ~$17.6
Slide 12: Average Retail Deposits
Average Retail Deposits 12 ©2022 Bread Financial +58% CAGR Strong retail deposit growth supports loan growth and improves funding mix ($ in billions)
Slide 13: Pretax Pre-Provision Earnings
Pretax Pre-Provision Earnings(1) 13 ©2022 Bread Financial ($ in millions) +22% +14% +52% +24% +24% Continued strong PPNR growth (1) Pretax Pre-Provision Earnings (PPNR) is a non-GAAP financial measure. See the "Non-GAAP Financial Measures" section below and the reconciliation included in the Appendi
Slide 14: Strengthened Financial Resilience
Loan Loss reserve materially higher. Rate of 11.2%, up 520 bps from year-end 2019 and prior pre-recession periods. Strengthened Financial Resilience 14 ©2022 Bread Financial Enhanced Credit Risk Management Diversification across products, partners, and channels Stronger underwriting resulting from e
Slide 15: Capital and Debt
Capital and Debt 15 ©2022 Bread Financial (1) The “Tangible Equity + Credit Reserve Ratio” is calculated as the sum of Tangible Common Equity and Allowance for Credit Losses divided by end of period loans. This is a non-GAAP financial measure. See the "Non-GAAP Financial Measures" section below and
Slide 16: Financial Update
©2022 Bread Financial 16 Financial Update Mid-Quarter 3Q22 Update Loan growth continues to inflect higher with 13-14% year-over-year average balance growth Expenses to increase sequentially with 3Q22 up approximately $40 million from 2Q22 Credit metrics continue to normalize Effective tax rate of ap
Slide 17: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements give our expectations or forecasts of future events and can generally be
Slide 18: About Bread Financial
Bread FinancialTM (NYSE: BFH) is a tech-forward financial services company providing simple, personalized payment, lending and saving solutions. The company creates opportunities for its customers and partners through digitally enabled choices that offer ease, empowerment, financial flexibility and
Slide 19: Appendix
Appendix ©2022 Bread Financial | Confidential & Proprietary 19
Slide 20: Reconciliation of GAAP to Non-GAAP Financial Measures
Reconciliation of GAAP to Non-GAAP Financial Measures 20 ©2022 Bread Financial ($ in millions) 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 YTD ’21 YTD ‘22 Pretax pre-provision earnings (PPNR) Income before income taxes $28 $162 $129 $367 $354 $259 $65 $302 $16 $721 $319 Provision for credit losses
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