Synchrony Financial · NYSE:SYF
Synchrony Financial — Q3 2023 Earnings Presentation
14 slides from Synchrony Financial's earnings presentation, Oct 24, 2023
Slide 1: 3Q'23 Financial Results
3Q'23 FINANCIAL RESULTS October 24, 2023
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. No representation is made that the information in these slides is complete. For additional informatio
Slide 3: 3Q'23 Financial Highlights
3Q'23 Financial Highlights SUMMARY FINANCIAL METRICS CAPITAL $1.48 15.36% 12.4% DILUTED EPS NET INTEREST MARGIN CET1 compared to $1.47 compared to 15.52% liquid assets of $17.6 billion, 15.6% of total assets $97.9 billion 4.60% $78.1 billion LOAN RECEIVABLES NET CHARGE-OFFS DEPOSITS compared to $86.
Slide 4: 3Q'23 Business Highlights
3Q'23 Business Highlights BUSINESS EXPANSION GROWTH METRICS CONSUMER PERFORMANCE Purchase volume New accounts(a) $ billions 5% (2)% Dual Card / Co-Brand $17.5 $19.8 13% Loan receivables Purchase volume per account (b) $ billions 14% —% Dual Card / $19.8 $25.1 27% Co-Brand (c) Average active accounts
Slide 5: Financial Results
Financial Results Summary earnings statement 3Q'23 Highlights B/(W) $628 million Net earnings, $1.48 diluted EPS $ in millions, except per share statistics 3Q'23 3Q'22 $ % • Net interest income up 11% Total interest income $5,354 $4,342 $1,012 23 % – Interest and fees on loans up 21% driven primaril
Slide 6: 3Q'23 Platform Results
3Q'23 Platform Results (a) Loan receivables $ in billions Home & Digital Diversified & Health & Lifestyle Auto Value Wellness 9% 16% 14% 21% 14% 3Q'22 3Q'23 V% 3Q'22 3Q'23 V% 3Q'22 3Q'23 V% 3Q'22 3Q'23 V% 3Q'22 3Q'23 V% Purchase $12.3 $12.3 —% $12.9 $13.8 7% $14.5 $15.4 7% $3.5 $4.0 14% $1.4 $1.5 8%
Slide 7: Net Interest Income
Net Interest Income 3Q'23 Highlights Net Interest Income 11% $ in millions • Net interest income increased 11% % of average interest-earning assets – Interest and fees on loans up 21% driven primarily by growth in average loan receivables, higher benchmark rates, and lower payment rate – Interest ex
Slide 8: Asset Quality Metrics
Asset Quality Metrics 30+ days past due Net charge-offs $ in millions, % of period-end loan receivables $ in millions, % of average loan receivables including held for sale (a) 90+ days past due Allowance for credit losses $ in millions, % of period-end loan receivables $ in millions, % of period-en
Slide 9: Other Expense
Other Expense Other Expense $ in millions 8% 3Q'23 Highlights • Total other expense up 8% – Increase primarily driven by growth related items as well as technology investments and operational losses – Increases were partially offset by additional marketing and growth reinvestment of Gain on Sale pro
Slide 10: Funding, Capital and Liquidity
Funding, Capital and Liquidity (a) Funding sources V$ Liquidity $ in billions $ in billions $0.8 $0.1 Unsecured Securitization $9.7 Deposits V% Deposits 82% 84% 2 pts. Liquid assets $16.6 $17.6 Undrawn credit facilities $3.7 $2.9 Securitization 8% 7% (1) pts. Total liquidity $20.3 $20.5 Unsecured 10
Slide 11: 2023 Outlook
2023 Outlook Full Year 2023 Key Driver Original Current Trends / Update • 3Q driven by payment rate moderation and purchase volume growth Loan receivables growth 8 – 10% ~11% • Expect purchase volume growth rate to slow and payment rate moderation to continue, but remain above pre-pandemic levels th
Slide 12: Footnotes
Footnotes All amounts and metrics included in this presentation are as of, or for the three months ended, September 30, 2023, unless otherwise stated. 3Q'23 Business Highlights a. New accounts represent accounts that were approved in the respective period, in millions. b. Purchase volume per account
Slide 13: Synchrony: Changing What's Possible
»/" synchrony CHANGING WHAT’S POSSIBLE
Slide 14: 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 Total 2022 2023 Tier 1 Capital $ 13,012 $ 12,906 Less: CECL transition adjustment (1,719) (1,146) Tier 1 capital (CECL fully ph