Le Lézard
Classified in: Business
Subjects: ERN, CCA

Synchrony Financial Reports Second Quarter Net Earnings of $853 Million or $1.24 Per Diluted Share


STAMFORD, Conn., July 19, 2019 /PRNewswire/ -- Synchrony Financial (NYSE: SYF) today announced second quarter 2019 net earnings of $853 million, or $1.24 per diluted share; this includes a $247 million pre-tax, $186 million after-tax, or $0.27 per diluted share benefit from a reduction in the reserve related to the expected sale of the Walmart portfolio. Highlights included*:

Synchrony Logo (PRNewsfoto/Synchrony)

"Our focus on driving growth both organically and through new partner programs is evident in the progress made across each of our sales platforms in the second quarter. Investing in leading digital technologies and innovative data analytics capabilities has been paramount to delivering an optimal customer experience, empowering us to grow existing programs and win new ones," said Margaret Keane, Chief Executive Officer of Synchrony Financial.  "We remain highly focused on the risk-adjusted returns of our programs, operating with a strong balance sheet, and returning capital to shareholders?during the quarter we began executing our new capital plan which includes share repurchases of up to $4.0 billion and an increase in the quarterly dividend to $0.22 per share beginning in the third quarter."

* All comparisons are for the second quarter of 2019 compared to the second quarter of 2018, unless otherwise noted

Business and Financial Highlights for the Second Quarter of 2019

All comparisons are for the second quarter of 2019 compared to the second quarter of 2018, unless otherwise noted. The PayPal Credit program acquisition occurred in the third quarter of 2018.

Earnings

Balance Sheet

Key Financial Metrics

Credit Quality

Sales Platforms


Corresponding Financial Tables and Information

No representation is made that the information in this news release is complete.  Investors are encouraged to review the foregoing summary and discussion of Synchrony Financial's earnings and financial condition in conjunction with the detailed financial tables and information that follow and the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2018, as filed February 15, 2019, and the Company's forthcoming Quarterly Report on Form 10-Q for the quarter ended June 30, 2019.  The detailed financial tables and other information are also available on the Investor Relations page of the Company's website at www.investors.synchronyfinancial.com. This information is also furnished in a Current Report on Form 8-K filed with the SEC today.

Conference Call and Webcast Information

On Friday, July 19, 2019, at 7:30 a.m. Eastern Time, Margaret Keane, Chief Executive Officer, Brian Doubles, President, and Brian Wenzel, Executive Vice President and Chief Financial Officer, will host a conference call to review the financial results and outlook for certain business drivers. The conference call can be accessed via an audio webcast through the Investor Relations page on the Synchrony Financial corporate website, www.investors.synchronyfinancial.com, under Events and Presentations. A replay will be available on the website or by dialing (888) 843-7419 (U.S. domestic) or (630) 652-3042 (international), passcode 22019#, and can be accessed beginning approximately two hours after the event through August 2, 2019.

About Synchrony Financial

Synchrony Financial (NYSE: SYF) is a premier consumer financial services company delivering customized financing programs across key industries including retail, health, auto, travel and home, along with award-winning consumer banking products. With more than $140 billion in sales financed and 80.3 million active accounts, Synchrony Financial brings deep industry expertise, actionable data insights, innovative solutions and differentiated digital experiences to improve the success of every business we serve and the quality of each life we touch. More information can be found at www.synchronyfinancial.com and through Twitter: @Synchrony.

Cautionary Statement Regarding Forward-Looking Statements

This news release contains certain forward-looking statements as defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are subject to the "safe harbor" created by those sections. Forward-looking statements may be identified by words such as "expects," "intends," "anticipates," "plans," "believes," "seeks," "targets," "outlook," "estimates," "will," "should," "may" or words of similar meaning, but these words are not the exclusive means of identifying forward-looking statements. Forward-looking statements are based on management's current expectations and assumptions, and are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. As a result, actual results could differ materially from those indicated in these forward-looking statements. Factors that could cause actual results to differ materially include global political, economic, business, competitive, market, regulatory and other factors and risks, such as: the impact of macroeconomic conditions and whether industry trends we have identified develop as anticipated; retaining existing partners and attracting new partners, concentration of our revenue in a small number of Retail Card partners, promotion and support of our products by our partners, and financial performance of our partners; cyber-attacks or other security breaches; higher borrowing costs and adverse financial market conditions impacting our funding and liquidity, and any reduction in our credit ratings; our ability to grow our deposits in the future; our ability to securitize our loan receivables, occurrence of an early amortization of our securitization facilities, loss of the right to service or subservice our securitized loan receivables, and lower payment rates on our securitized loan receivables; changes in market interest rates and the impact of any margin compression; effectiveness of our risk management processes and procedures, reliance on models which may be inaccurate or misinterpreted, our ability to manage our credit risk, the sufficiency of our allowance for loan losses and the accuracy of the assumptions or estimates used in preparing our financial statements; our ability to offset increases in our costs in retailer share arrangements; competition in the consumer finance industry; our concentration in the U.S. consumer credit market; our ability to successfully develop and commercialize new or enhanced products and services; our ability to realize the value of acquisitions and strategic investments; reductions in interchange fees; fraudulent activity; failure of third parties to provide various services that are important to our operations; disruptions in the operations of our computer systems and data centers; international risks and compliance and regulatory risks and costs associated with international operations; alleged infringement of intellectual property rights of others and our ability to protect our intellectual property; litigation and regulatory actions; damage to our reputation; our ability to attract, retain and motivate key officers and employees; tax legislation initiatives or challenges to our tax positions and/or interpretations, and state sales tax rules and regulations; a material indemnification obligation to GE under the tax sharing and separation agreement with GE if we cause the split-off from GE or certain preliminary transactions to fail to qualify for tax-free treatment or in the case of certain significant transfers of our stock following the split-off; regulation, supervision, examination and enforcement of our business by governmental authorities, the impact of the Dodd-Frank Wall Street Reform and Consumer Protection Act and other legislative and regulatory developments and the impact of the Consumer Financial Protection Bureau's regulation of our business; impact of capital adequacy rules and liquidity requirements; restrictions that limit our ability to pay dividends and repurchase our common stock, and restrictions that limit Synchrony Bank's ability to pay dividends to us; regulations relating to privacy, information security and data protection; use of third-party vendors and ongoing third-party business relationships; and failure to comply with anti-money laundering and anti-terrorism financing laws.

For the reasons described above, we caution you against relying on any forward-looking statements, which should also be read in conjunction with the other cautionary statements that are included elsewhere in this news release and in our public filings, including under the heading "Risk Factors" in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2018, as filed on February 15, 2019. You should not consider any list of such factors to be an exhaustive statement of all the risks, uncertainties, or potentially inaccurate assumptions that could cause our current expectations or beliefs to change. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update or revise any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events, except as otherwise may be required by law.

Non-GAAP Measures

The information provided herein includes measures we refer to as "tangible common equity" and certain "Core" financial measures that have been adjusted to exclude amounts related to the Walmart portfolio, which are not prepared in accordance with U.S. generally accepted accounting principles ("GAAP").  For a reconciliation of these non-GAAP measures to the most directly comparable GAAP measures, please see the detailed financial tables and information that follow. For a statement regarding the usefulness of these measures to investors, please see the Company's Current Report on Form 8-K filed with the SEC today.

SYNCHRONY FINANCIAL




















FINANCIAL SUMMARY




















(unaudited, in millions, except per share statistics)





















Quarter Ended




Six Months Ended





Jun 30,
2019


Mar 31,
2019


Dec 31,
2018


Sep 30,
2018


Jun 30,
2018


2Q'19 vs. 2Q'18


Jun 30,
2019


Jun 30,
2018


YTD'19 vs. YTD'18

EARNINGS




















Net interest income

$4,155


$4,226


$4,333


$4,206


$3,737


$418

11.2%


$8,381


$7,579


$802

10.6%

Retailer share arrangements

(859)


(954)


(855)


(871)


(653)


(206)

31.5%


(1,813)


(1,373)


(440)

32.0%

Provision for loan losses

1,198


859


1,452


1,451


1,280


(82)

(6.4)%


2,057


2,642


(585)

(22.1)%

Net interest income, after retailer share arrangements and provision for loan losses

2,098


2,413


2,026


1,884


1,804


294

16.3%


4,511


3,564


947

26.6%

Other income

90


92


64


63


63


27

42.9%


182


138


44

31.9%

Other expense

1,059


1,043


1,078


1,054


975


84

8.6%


2,102


1,963


139

7.1%

Earnings before provision for income taxes

1,129


1,462


1,012


893


892


237

26.6%


2,591


1,739


852

49.0%

Provision for income taxes

276


355


229


222


196


80

40.8%


631


403


228

56.6%

Net earnings

$853


$1,107


$783


$671


$696


$157

22.6%


$1,960


$1,336


$624

46.7%

Net earnings attributable to common stockholders

$853


$1,107


$783


$671


$696


$157

22.6%


$1,960


$1,336


$624

46.7%





























































COMMON SHARE STATISTICS




















Basic EPS   

$1.25


$1.57


$1.09


$0.91


$0.93


$0.32

34.4%


$2.82


$1.76


$1.06

60.2%

Diluted EPS   

$1.24


$1.56


$1.09


$0.91


$0.92


$0.32

34.8%


$2.81


$1.75


$1.06

60.6%





















Dividend declared per share

$0.21


$0.21


$0.21


$0.21


$0.15


$0.06

40.0%


$0.42


$0.30


$0.12

40.0%

Common stock price

$34.67


$31.90


$23.46


$31.08


$33.38


$1.29

3.9%


$34.67


$33.38


$1.29

3.9%

Book value per share   

$22.03


$21.35


$20.42


$19.47


$19.37


$2.66

13.7%


$22.03


$19.37


$2.66

13.7%

Tangible common equity per share(1)

$18.60


$17.96


$17.41


$16.51


$16.84


$1.76

10.5%


$18.60


$16.84


$1.76

10.5%





















Beginning common shares outstanding

688.8


718.8


718.7


746.6


760.3


(71.5)

(9.4)%


718.8


770.5


(51.7)

(6.7)%

Issuance of common shares

-


-


-


-


-


-

NM


-


-


-

- %

Stock-based compensation

1.2


0.9


0.1


2.4


0.3


0.9

NM


2.1


0.5


1.6

NM

Shares repurchased

(21.1)


(30.9)


-


(30.3)


(14.0)


(7.1)

50.7%


(52.0)


(24.4)


(27.6)

113.1%

Ending common shares outstanding

668.9


688.8


718.8


718.7


746.6


(77.7)

(10.4)%


668.9


746.6


(77.7)

(10.4)%





















Weighted average common shares outstanding 

683.6


706.3


718.7


734.9


752.2


(68.6)

(9.1)%


694.8


757.9


(63.1)

(8.3)%

Weighted average common shares outstanding (fully diluted) 

686.5


708.9


720.9


738.8


758.3


(71.8)

(9.5)%


697.7


764.3


(66.6)

(8.7)%





















(1) Tangible Common Equity ("TCE") is a non-GAAP measure. For corresponding reconciliation of TCE to a GAAP financial measure, see Reconciliation of Non-GAAP Measures and Calculations of Regulatory Measures.

 

SYNCHRONY FINANCIAL




















SELECTED METRICS




















(unaudited, $ in millions, except account data)





















Quarter Ended




Six Months Ended





Jun 30,
2019


Mar 31,
2019


Dec 31,
2018


Sep 30,
2018


Jun 30,
2018


2Q'19 vs. 2Q'18


Jun 30,
2019


Jun 30,
2018


YTD'19 vs. YTD'18

PERFORMANCE METRICS




















Return on assets(1)

3.3%


4.3%


2.9%


2.7%


2.9%



0.4%


3.8%


2.8%



1.0%

Return on equity(2)

23.1%


30.4%


21.5%


18.5%


19.4%



3.7%


26.7%


18.8%



7.9%

Return on tangible common equity(3)

27.4%


35.8%


25.2%


21.5%


22.1%



5.3%


31.6%


21.5%



10.1%

Net interest margin(4)

15.75%


16.08%


16.06%


16.41%


15.33%



0.42%


15.92%


15.69%



0.23%

Efficiency ratio(5)

31.3%


31.0%


30.4%


31.0%


31.0%



0.3%


31.1%


30.9%



0.2%

Other expense as a % of average loan receivables, including held for sale

4.78%


4.71%


4.79%


4.82%


5.02%



(0.24)%


4.74%


5.04%



(0.30)%

Effective income tax rate

24.4%


24.3%


22.6%


24.9%


22.0%



2.4%


24.4%


23.2%



1.2%





















CREDIT QUALITY METRICS




















Net charge-offs as a % of average loan receivables, including held for sale

6.01%


6.06%


5.54%


4.97%


5.97%



0.04%


6.04%


6.06%



(0.02)%

30+ days past due as a % of period-end loan receivables(6)

4.43%


4.92%


4.76%


4.59%


4.17%



0.26%


4.43%


4.17%



0.26%

90+ days past due as a % of period-end loan receivables(6)

2.16%


2.51%


2.29%


2.09%


1.98%



0.18%


2.16%


1.98%



0.18%

Net charge-offs

$1,331


$1,344


$1,248


$1,087


$1,159


$172

14.8%


$2,675


$2,357


$318

13.5%

Loan receivables delinquent over 30 days(6)

$3,625


$3,957


$4,430


$4,021


$3,293


$332

10.1%


$3,625


$3,293


$332

10.1%

Loan receivables delinquent over 90 days(6)

$1,768


$2,019


$2,135


$1,833


$1,561


$207

13.3%


$1,768


$1,561


$207

13.3%





















Allowance for loan losses (period-end)

$5,809


$5,942


$6,427


$6,223


$5,859


$(50)

(0.9)%


$5,809


$5,859


$(50)

(0.9)%

Allowance coverage ratio(7)

7.10%


7.39%


6.90%


7.11%


7.43%



(0.33)%


7.10%


7.43%



(0.33)%





















BUSINESS METRICS




















Purchase volume(8)(9)

$38,291


$32,513


$40,320


$36,443


$34,268


$4,023

11.7%


$70,804


$63,894


$6,910

10.8%

Period-end loan receivables

$81,796


$80,405


$93,139


$87,521


$78,879


$2,917

3.7%


$81,796


$78,879


$2,917

3.7%

Credit cards

$78,446


$77,251


$89,994


$84,319


$75,753


$2,693

3.6%


$78,446


$75,753


$2,693

3.6%

Consumer installment loans

$1,983


$1,860


$1,845


$1,789


$1,708


$275

16.1%


$1,983


$1,708


$275

16.1%

Commercial credit products

$1,328


$1,256


$1,260


$1,353


$1,356


$(28)

(2.1)%


$1,328


$1,356


$(28)

(2.1)%

Other

$39


$38


$40


$60


$62


$(23)

(37.1)%


$39


$62


$(23)

(37.1)%

Average loan receivables, including held for sale

$88,792


$89,903


$89,340


$86,783


$77,853


$10,939

14.1%


$89,344


$78,468


$10,876

13.9%

Period-end active accounts (in thousands)(9)(10)

76,065


74,812


80,339


75,457


69,767


6,298

9.0%


76,065


69,767


6,298

9.0%

Average active accounts (in thousands)(9)(10)

75,525


77,132


77,382


75,482


69,344


6,181

8.9%


76,545


70,540


6,005

8.5%





















LIQUIDITY




















Liquid assets




















Cash and equivalents

$11,755


$12,963


$9,396


$12,068


$15,675


$(3,920)

(25.0)%


$11,755


$15,675


$(3,920)

(25.0)%

Total liquid assets

$16,665


$17,360


$14,822


$18,214


$21,491


$(4,826)

(22.5)%


$16,665


$21,491


$(4,826)

(22.5)%

Undrawn credit facilities




















Undrawn credit facilities

$7,050


$6,050


$4,375


$5,125


$6,500


$550

8.5%


$7,050


$6,500


$550

8.5%

Total liquid assets and undrawn credit facilities

$23,715


$23,410


$19,197


$23,339


$27,991


$(4,276)

(15.3)%


$23,715


$27,991


$(4,276)

(15.3)%

Liquid assets % of total assets

15.66%


16.47%


13.88%


17.42%


21.68%



(6.02)%


15.66%


21.68%



(6.02)%

Liquid assets including undrawn credit facilities % of total assets

22.29%


22.21%


17.98%


22.32%


28.24%



(5.95)%


22.29%


28.24%



(5.95)%





















(1) Return on assets represents net earnings as a percentage of average total assets. 




















(2) Return on equity represents net earnings as a percentage of average total equity.




















(3) Return on tangible common equity represents net earnings as a percentage of average tangible common equity. Tangible common equity ("TCE") is a non-GAAP measure. For corresponding reconciliation of TCE to a GAAP financial measure, see Reconciliation of Non-GAAP
Measures and Calculations of Regulatory Measures.

(4) Net interest margin represents net interest income divided by average interest-earning assets. 

(5) Efficiency ratio represents (i) other expense, divided by (ii) net interest income, plus other income, less retailer share arrangements.

(6) Based on customer statement-end balances extrapolated to the respective period-end date.

(7) Allowance coverage ratio represents allowance for loan losses divided by total period-end loan receivables.

(8) Purchase volume, or net credit sales, represents the aggregate amount of charges incurred on credit cards or other credit product accounts less returns during the period. 

(9) Includes activity and accounts associated with loan receivables held for sale.

(10) Active accounts represent credit card or installment loan accounts on which there has been a purchase, payment or outstanding balance in the current month.

 

SYNCHRONY FINANCIAL




















STATEMENTS OF EARNINGS




















(unaudited, $ in millions)





















Quarter Ended




Six Months Ended





Jun 30,
2019


Mar 31,
2019


Dec 31,
2018


Sep 30,
2018


Jun 30,
2018


2Q'19 vs. 2Q'18


Jun 30,
2019


Jun 30,
2018


YTD'19 vs. YTD'18

Interest income:




















Interest and fees on loans

$4,636


$4,687


$4,774


$4,617


$4,081


$555

13.6%


$9,323


$8,253


$1,070

13.0%

Interest on cash and investment securities

102


99


102


77


93


9

9.7%


201


165


36

21.8%

Total interest income

4,738


4,786


4,876


4,694


4,174


564

13.5%


9,524


8,418


1,106

13.1%





















Interest expense:




















Interest on deposits

397


375


350


314


273


124

45.4%


772


522


250

47.9%

Interest on borrowings of consolidated securitization entities

90


100


104


86


80


10

12.5%


190


154


36

23.4%

Interest on senior unsecured notes

96


85


89


88


84


12

14.3%


181


163


18

11.0%

Total interest expense

583


560


543


488


437


146

33.4%


1,143


839


304

36.2%





















Net interest income

4,155


4,226


4,333


4,206


3,737


418

11.2%


8,381


7,579


802

10.6%





















Retailer share arrangements

(859)


(954)


(855)


(871)


(653)


(206)

31.5%


(1,813)


(1,373)


(440)

32.0%





















Provision for loan losses

1,198


859


1,452


1,451


1,280


(82)

(6.4)%


2,057


2,642


(585)

(22.1)%

Net interest income, after retailer share arrangements and provision for loan losses

2,098


2,413


2,026


1,884


1,804


294

16.3%


4,511


3,564


947

26.6%





















Other income:




















Interchange revenue

194


165


193


182


177


17

9.6%


359


335


24

7.2%

Debt cancellation fees

69


68


70


65


66


3

4.5%


137


132


5

3.8%

Loyalty programs

(192)


(167)


(208)


(196)


(192)


-

- %


(359)


(347)


(12)

3.5%

Other

19


26


9


12


12


7

58.3%


45


18


27

150.0%

Total other income

90


92


64


63


63


27

42.9%


182


138


44

31.9%





















Other expense:




















Employee costs

358


353


353


365


351


7

2.0%


711


709


2

0.3%

Professional fees

231


232


231


232


177


54

30.5%


463


343


120

35.0%

Marketing and business development

135


123


166


131


110


25

22.7%


258


231


27

11.7%

Information processing

123


113


118


105


99


24

24.2%


236


203


33

16.3%

Other

212


222


210


221


238


(26)

(10.9)%


434


477


(43)

(9.0)%

Total other expense

1,059


1,043


1,078


1,054


975


84

8.6%


2,102


1,963


139

7.1%





















Earnings before provision for income taxes

1,129


1,462


1,012


893


892


237

26.6%


2,591


1,739


852

49.0%

Provision for income taxes

276


355


229


222


196


80

40.8%


631


403


228

56.6%

Net earnings attributable to common stockholders

$853


$1,107


$783


$671


$696


$157

22.6%


$1,960


$1,336


$624

46.7%





















 

SYNCHRONY FINANCIAL













STATEMENTS OF FINANCIAL POSITION













(unaudited, $ in millions)














Quarter Ended




Jun 30,
2019


Mar 31,
2019


Dec 31,
2018


Sep 30,
2018


Jun 30,
2018


Jun 30, 2019 vs.
Jun 30, 2018

Assets













Cash and equivalents

$11,755


$12,963


$9,396


$12,068


$15,675


$(3,920)

(25.0)%

Debt securities

6,147


5,506


6,062


7,281


6,779


(632)

(9.3)%

Loan receivables:













Unsecuritized loans held for investment

55,178


54,907


64,969


59,868


50,884


4,294

8.4%

Restricted loans of consolidated securitization entities

26,618


25,498


28,170


27,653


27,995


(1,377)

(4.9)%

Total loan receivables

81,796


80,405


93,139


87,521


78,879


2,917

3.7%

Less: Allowance for loan losses

(5,809)


(5,942)


(6,427)


(6,223)


(5,859)


50

(0.9)%

Loan receivables, net

75,987


74,463


86,712


81,298


73,020


2,967

4.1%

Loan receivables held for sale

8,096


8,052


-


-


-


8,096

NM

Goodwill

1,078


1,076


1,024


1,024


1,024


54

5.3%

Intangible assets, net

1,215


1,259


1,137


1,105


863


352

40.8%

Other assets

2,110


2,065


2,461


1,769


1,761


349

19.8%

Total assets

$106,388


$105,384


$106,792


$104,545


$99,122


$7,266

7.3%














Liabilities and Equity













Deposits:













Interest-bearing deposit accounts

$65,382


$63,787


$63,738


$62,030


$58,734


$6,648

11.3%

Non-interest-bearing deposit accounts

263


273


281


287


277


(14)

(5.1)%

Total deposits

65,645


64,060


64,019


62,317


59,011


6,634

11.2%

Borrowings:













Borrowings of consolidated securitization entities

11,941


12,091


14,439


14,187


12,170


(229)

(1.9)%














Senior unsecured notes

9,303


9,800


9,557


9,554


9,551


(248)

(2.6)%

Total borrowings

21,244


21,891


23,996


23,741


21,721


(477)

(2.2)%

Accrued expenses and other liabilities

4,765


4,724


4,099


4,491


3,932


833

21.2%

Total liabilities

91,654


90,675


92,114


90,549


84,664


6,990

8.3%

Equity:













Common stock

1


1


1


1


1


-

- %

Additional paid-in capital

9,500


9,489


9,482


9,470


9,486


14

0.1%

Retained earnings

10,627


9,939


8,986


8,355


7,906


2,721

34.4%

Accumulated other comprehensive income:

(43)


(56)


(62)


(99)


(93)


50

(53.8)%

Treasury Stock

(5,351)


(4,664)


(3,729)


(3,731)


(2,842)


(2,509)

88.3%

Total equity

14,734


14,709


14,678


13,996


14,458


276

1.9%

Total liabilities and equity

$106,388


$105,384


$106,792


$104,545


$99,122


$7,266

7.3%

 

SYNCHRONY FINANCIAL






























AVERAGE BALANCES, NET INTEREST INCOME AND NET INTEREST MARGIN



























(unaudited, $ in millions)





























































Quarter Ended


Jun 30, 2019


Mar 31, 2019


Dec 31, 2018


Sep 30, 2018


Jun 30, 2018




Interest


Average




Interest


Average




Interest


Average




Interest


Average




Interest


Average


Average


Income/


Yield/


Average


Income/


Yield/


Average


Income/


Yield/


Average


Income/


Yield/


Average


Income/


Yield/


Balance


Expense


Rate


Balance


Expense


Rate


Balance


Expense


Rate


Balance


Expense


Rate


Balance


Expense


Rate

Assets






























Interest-earning assets:






























Interest-earning cash and equivalents

$10,989


$66


2.41%


$11,033


$65


2.39%


$10,856


$62


2.27%


$7,901


$39


1.96%


$13,097


$59


1.81%

Securities available for sale

6,010


36


2.40%


5,640


34


2.44%


6,837


40


2.32%


7,022


38


2.15%


6,803


34


2.00%































Loan receivables:






























Credit cards, including held for sale

85,488


4,557


21.38%


86,768


4,611


21.55%


86,131


4,695


21.63%


83,609


4,538


21.53%


74,809


4,010


21.50%

Consumer installment loans

1,924


44


9.17%


1,844


42


9.24%


1,815


42


9.18%


1,753


41


9.28%


1,648


37


9.01%

Commercial credit products

1,330


34


10.25%


1,252


34


11.01%


1,344


37


10.92%


1,355


37


10.83%


1,346


34


10.13%

Other

50


1


NM


39


-


- %


50


-


- %


66


1


NM


50


-


- %

Total loan receivables, including held for sale

88,792


4,636


20.94%


89,903


4,687


21.14%


89,340


4,774


21.20%


86,783


4,617


21.11%


77,853


4,081


21.03%

Total interest-earning assets

105,791


4,738


17.96%


106,576


4,786


18.21%


107,033


4,876


18.07%


101,706


4,694


18.31%


97,753


4,174


17.13%































Non-interest-earning assets:






























Cash and due from banks

1,271






1,335






1,320






1,217






1,161





Allowance for loan losses

(5,911)






(6,341)






(6,259)






(5,956)






(5,768)





Other assets

3,752






3,729






3,688






3,482






3,068





Total non-interest-earning assets

(888)






(1,277)






(1,251)






(1,257)






(1,539)



































Total assets

$104,903






$105,299






$105,782






$100,449






$96,214



































Liabilities






























Interest-bearing liabilities:






























Interest-bearing deposit accounts

$64,226


$397


2.48%


$63,776


$375


2.38%


$62,999


$350


2.20%


$60,123


$314


2.07%


$57,303


$273


1.91%

Borrowings of consolidated securitization entities

11,785


90


3.06%


13,407


100


3.02%


14,223


104


2.90%


12,306


86


2.77%


11,821


80


2.71%

Senior unsecured notes

9,543


96


4.03%


8,892


85


3.88%


9,554


89


3.70%


9,552


88


3.66%


9,114


84


3.70%































Total interest-bearing liabilities

85,554


583


2.73%


86,075


560


2.64%


86,776


543


2.48%


81,981


488


2.36%


78,238


437


2.24%































Non-interest-bearing liabilities






























Non-interest-bearing deposit accounts

271






286






284






275






270





Other liabilities

4,260






4,148






4,283






3,772






3,299





Total non-interest-bearing liabilities

4,531






4,434






4,567






4,047






3,569



































Total liabilities

90,085






90,509






91,343






86,028






81,807



































Equity






























Total equity

14,818






14,790






14,439






14,421






14,407



































Total liabilities and equity

$104,903






$105,299






$105,782






$100,449






$96,214





Net interest income



$4,155






$4,226






$4,333






$4,206






$3,737

































Interest rate spread(1)





15.23%






15.57%






15.59%






15.95%






14.89%

Net interest margin(2)





15.75%






16.08%






16.06%






16.41%






15.33%































(1) Interest rate spread represents the difference between the yield on total interest-earning assets and the rate on total interest-bearing liabilities. 

(2) Net interest margin represents net interest income divided by average interest-earning assets. 

 

SYNCHRONY FINANCIAL












AVERAGE BALANCES, NET INTEREST INCOME AND NET INTEREST MARGIN












(unaudited, $ in millions)

























Six Months Ended
Jun 30, 2019


Six Months Ended
Jun 30, 2018




Interest


Average




Interest


Average


Average


Income/


Yield/


Average


Income/


Yield/


Balance


Expense


Rate


Balance


Expense


Rate

Assets












Interest-earning assets:












Interest-earning cash and equivalents

$11,011


$131


2.40%


$12,768


$106


1.67%

Securities available for sale

5,826


70


2.42%


6,197


59


1.92%













Loan receivables:












Credit cards, including held for sale

86,125


9,168


21.47%


75,492


8,109


21.66%

Consumer installment loans

1,884


86


9.21%


1,610


73


9.14%

Commercial credit products

1,291


68


10.62%


1,316


70


10.73%

Other

44


1


4.58%


50


1


4.03%

Total loan receivables, including held for sale

89,344


9,323


21.04%


78,468


8,253


21.21%

Total interest-earning assets

106,181


9,524


18.09%


97,433


8,418


17.42%













Non-interest-earning assets:












Cash and due from banks

1,303






1,179





Allowance for loan losses

(6,125)






(5,689)





Other assets

3,741






3,039





Total non-interest-earning assets

(1,081)






(1,471)

















Total assets

$105,100






$95,962

















Liabilities












Interest-bearing liabilities:












Interest-bearing deposit accounts

$64,002


$772


2.43%


$56,832


$522


1.85%

Borrowings of consolidated securitization entities

12,592


190


3.04%


12,114


154


2.56%

Senior unsecured notes

9,219


181


3.96%


8,955


163


3.67%













Total interest-bearing liabilities

85,813


1,143


2.69%


77,901


839


2.17%













Non-interest-bearing liabilities












Non-interest-bearing deposit accounts

278






285





Other liabilities

4,205






3,434





Total non-interest-bearing liabilities

4,483






3,719

















Total liabilities

90,296






81,620

















Equity












Total equity

14,804






14,342

















Total liabilities and equity

$105,100






$95,962





Net interest income



$8,381






$7,579















Interest rate spread(1)





15.40%






15.25%

Net interest margin(2)





15.92%






15.69%













(1) Interest rate spread represents the difference between the yield on total interest-earning assets and the rate on total interest-bearing liabilities. 

(2) Net interest margin represents net interest income divided by average interest-earning assets. 

 

SYNCHRONY FINANCIAL













BALANCE SHEET STATISTICS













(unaudited, $ in millions, except per share statistics)



























Quarter Ended




Jun 30,
2019


Mar 31,
2019


Dec 31,
2018


Sep 30,
2018


Jun 30,
2018


Jun 30, 2019 vs.
Jun 30, 2018

BALANCE SHEET STATISTICS













Total common equity

$14,734


$14,709


$14,678


$13,996


$14,458


$276

1.9%

Total common equity as a % of total assets

13.85%


13.96%


13.74%


13.39%


14.59%



(0.74)%














Tangible assets

$104,095


$103,049


$104,631


$102,416


$97,235


$6,860

7.1%

Tangible common equity(1)

$12,441


$12,374


$12,517


$11,867


$12,571


$(130)

(1.0)%

Tangible common equity as a % of tangible assets(1)

11.95%


12.01%


11.96%


11.59%


12.93%



(0.98)%

Tangible common equity per share(1)

$18.60


$17.96


$17.41


$16.51


$16.84


$1.76

10.5%














REGULATORY CAPITAL RATIOS(2)














Basel III Fully Phased-in



Total risk-based capital ratio(3)

15.6%


15.8%


15.3%


15.5%


18.0%




Tier 1 risk-based capital ratio(4)

14.3%


14.5%


14.0%


14.2%


16.6%




Tier 1 leverage ratio(5)

12.4%


12.3%


12.3%


12.3%


13.6%




Common equity Tier 1 capital ratio

14.3%


14.5%


14.0%


14.2%


16.6%































(1) Tangible common equity ("TCE") is a non-GAAP measure. We believe TCE is a more meaningful measure of the net asset value of the Company to investors. For corresponding reconciliation
of TCE to a GAAP financial measure, see Reconciliation of Non-GAAP Measures and Calculations of Regulatory Measures.

(2) Regulatory capital metrics at June 30, 2019 are preliminary and therefore subject to change. 

(3) Total risk-based capital ratio is the ratio of total risk-based capital divided by risk-weighted assets.









(4) Tier 1 risk-based capital ratio is the ratio of Tier 1 capital divided by risk-weighted assets.










(5) Tier 1 leverage ratio is the ratio of Tier 1 capital divided by total average assets, after certain adjustments. Tier 1 leverage ratios are based upon the use of daily averages for all periods
presented.

 

SYNCHRONY FINANCIAL




















PLATFORM RESULTS




















(unaudited, $ in millions)





















Quarter Ended




Six Months Ended





Jun 30,
2019


Mar 31,
2019


Dec 31,
2018


Sep 30,
2018


Jun 30,
2018


2Q'19 vs. 2Q'18


Jun 30,
2019


Jun 30,
2018


YTD'19 vs. YTD'18

RETAIL CARD(1)




















Purchase volume(2)(3)

$29,530


$24,660


$31,755


$27,863


$25,926


$3,604

13.9%


$54,190


$48,067


$6,123

12.7%

Period-end loan receivables

$52,307


$51,572


$63,827


$59,139


$51,473


$834

1.6%


$52,307


$51,473


$834

1.6%

Average loan receivables, including held for sale

$59,861


$60,964


$60,604


$58,964


$51,011


$8,850

17.3%


$60,409


$51,628


$8,781

17.0%

Average active accounts (in thousands)(3)(4)

57,212


58,632


58,962


57,459


51,680


5,532

10.7%


58,132


52,769


5,363

10.2%





















Interest and fees on loans

$3,390


$3,454


$3,502


$3,383


$2,915


$475

16.3%


$6,844


$5,930


$914

15.4%

Other income

$59


$76


$59


$57


$54


$5

9.3%


$135


$123


$12

9.8%





















Retailer share arrangements

$(836)


$(940)


$(825)


$(844)


$(637)


$(199)

31.2%


$(1,776)


$(1,345)


$(431)

32.0%









































PAYMENT SOLUTIONS(1)




















Purchase volume(2)

$5,948


$5,249


$6,035


$6,007


$5,702


$246

4.3%


$11,197


$10,766


$431

4.0%

Period-end loan receivables

$19,766


$19,379


$19,815


$19,064


$18,320


$1,446

7.9%


$19,766


$18,320


$1,446

7.9%

Average loan receivables, including held for sale

$19,409


$19,497


$19,333


$18,659


$17,978


$1,431

8.0%


19,453


$18,014


$1,439

8.0%

Average active accounts (in thousands)(4)

12,227


12,406


12,350


12,062


11,845


382

3.2%


12,321


11,934


387

3.2%





















Interest and fees on loans

$685


$686


$708


$683


$644


$41

6.4%


$1,371


$1,287


$84

6.5%

Other income

$11


$1


$(2)


$(2)


$(2)


$13

NM


$12


$(4)


$16

NM

Retailer share arrangements

$(21)


$(12)


$(25)


$(24)


$(14)


$(7)

50.0%


$(33)


$(24)


$(9)

37.5%





















CARECREDIT




















Purchase volume(2)

$2,813


$2,604


$2,530


$2,573


$2,640


$173

6.6%


$5,417


$5,061


$356

7.0%

Period-end loan receivables

$9,723


$9,454


$9,497


$9,318


$9,086


$637

7.0%


$9,723


$9,086


$637

7.0%

Average loan receivables, including held for sale

$9,522


$9,442


$9,403


$9,160


$8,864


$658

7.4%


$9,482


$8,826


$656

7.4%

Average active accounts (in thousands)(4)

6,086


6,094


6,070


5,961


5,819


267

4.6%


6,092


5,837


255

4.4%





















Interest and fees on loans

$561


$547


$564


$551


$522


$39

7.5%


$1,108


$1,036


$72

6.9%

Other income

$20


$15


$7


$8


$11


$9

81.8%


$35


$19


$16

84.2%





















Retailer share arrangements

$(2)


$(2)


$(5)


$(3)


$(2)


$-

- %


$(4)


$(4)


$-

- %





















TOTAL SYF




















Purchase volume(2)(3)

$38,291


$32,513


$40,320


$36,443


$34,268


$4,023

11.7%


$70,804


$63,894


$6,910

10.8%

Period-end loan receivables

$81,796


$80,405


$93,139


$87,521


$78,879


$2,917

3.7%


$81,796


$78,879


$2,917

3.7%

Average loan receivables, including held for sale

$88,792


$89,903


$89,340


$86,783


$77,853


$10,939

14.1%


$89,344


$78,468


$10,876

13.9%

Average active accounts (in thousands)(3)(4)

75,525


77,132


77,382


75,482


69,344


6,181

8.9%


76,545


70,540


6,005

8.5%





















Interest and fees on loans

$4,636


$4,687


$4,774


$4,617


$4,081


$555

13.6%


$9,323


$8,253


$1,070

13.0%

Other income

$90


$92


$64


$63


$63


$27

42.9%


$182


$138


$44

31.9%

Retailer share arrangements

$(859)


$(954)


$(855)


$(871)


$(653)


$(206)

31.5%


$(1,813)


$(1,373)


$(440)

32.0%





















(1) Beginning in 1Q 2019, our Oil and Gas retail credit programs are now included in our Payment Solutions sales platform. Prior period financial and operating metrics for Retail Card and Payment Solutions have been recast to reflect the
current period presentation.

(2) Purchase volume, or net credit sales, represents the aggregate amount of charges incurred on credit cards or other credit product accounts less returns during the period. 






(3) Includes activity and balances associated with loan receivables held for sale.

















(4) Active accounts represent credit card or installment loan accounts on which there has been a purchase, payment or outstanding balance in the current month.

 

SYNCHRONY FINANCIAL











RECONCILIATION OF NON-GAAP MEASURES AND CALCULATIONS OF REGULATORY MEASURES(1)








(unaudited, $ in millions, except per share statistics)












Quarter Ended



Jun 30,
2019


Mar 31,
2019


Dec 31,
2018


Sep 30,
2018


Jun 30,
2018


COMMON EQUITY MEASURES











GAAP Total common equity

$14,734


$14,709


$14,678


$13,996


$14,458


Less: Goodwill

(1,078)


(1,076)


(1,024)


(1,024)


(1,024)


Less: Intangible assets, net

(1,215)


(1,259)


(1,137)


(1,105)


(863)













Tangible common equity

$12,441


$12,374


$12,517


$11,867


$12,571


Adjustments for certain deferred tax liabilities and certain items in accumulated
comprehensive income (loss)

283


287


284


311


$287


Basel III - Common equity Tier 1 (fully phased-in)

$12,724


$12,661


$12,801


$12,178


$12,858













RISK-BASED CAPITAL











Common equity Tier 1

$12,724


$12,661


$12,801


$12,178


$12,858


Add: Allowance for loan losses includible in risk-based capital

1,169


1,152


1,211


1,137


1,027


Risk-based capital

$13,893


$13,813


$14,012


$13,315


$13,885













ASSET MEASURES











Total average assets

$104,903


$105,299


$105,782


$100,449


$96,214


Adjustments for:











Disallowed goodwill and other disallowed intangible assets
(net of related deferred tax liabilities) and other

(2,003)


(2,039)


(1,845)


(1,836)


(1,670)


Total assets for leverage purposes

$102,900


$103,260


$103,937


$98,613


$94,544













Risk-weighted assets - Basel III (fully phased-in)

$88,890


$87,331


$91,742


$85,941


$77,322













TANGIBLE COMMON EQUITY PER SHARE











GAAP book value per share

$22.03


$21.35


$20.42


$19.47


$19.37


Less: Goodwill

(1.61)


(1.56)


(1.42)


(1.42)


(1.37)


Less: Intangible assets, net

(1.82)


(1.83)


(1.59)


(1.54)


(1.16)


Tangible common equity per share

$18.60


$17.96


$17.41


$16.51


$16.84













(1) Regulatory measures at June 30, 2019 are presented on an estimated basis.


 

Investor Relations
Greg Ketron
(203) 585-6291

Media Relations
Sue Bishop
(203) 585-2802

 

SOURCE Synchrony


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TSX VENTURE COMPANIES BULLETIN V2024-1145 GOOD NATURED PRODUCTS INC. ("GDNP") ("GDNP.DB")BULLETIN TYPE: Convertible Debenture/s, Miscellaneous, HaltBULLETIN DATE: April 19, 2024TSX Venture Tier 2 Company Good Natured Products Inc. (the "Company")...

19 avr 2024
STOCKHOLDER INVESTIGATION: The M&A Class Action Firm Announces an Investigation of Chord Energy Corp. - CHRD
Monteverde & Associates PC (the "M&A Class Action Firm"), has recovered money for shareholders and is recognized as a Top 50 Firm in the 2018-2022 ISS Securities Class Action Services Report. We are headquartered at the Empire State Building in New...

19 avr 2024
Rise48 Equity Celebrates Milestone 50th Multifamily Acquisition
Rise48 Equity, a leading multifamily investment group, today announced the acquisition of Mosaic Apartments in the DFW area of Texas. This 288-unit complex marks a significant milestone as the company's 50th acquisition since 2019 and its 10th in the...

19 avr 2024
Media Advisory - Prime Minister's itinerary for Saturday, April 20, 2024
Note: All times local Victoria, British Columbia 10:20 a.m.    The Prime Minister will greet the President of Poland, Andrzej Duda. Note for media: Pooled photo opportunity10:25 a.m. The Prime Minister will meet with the President of Poland,...

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