Exhibit 99.2


SYNCHRONY FINANCIAL
 
 
 
 
 
 
 
 
 
 
 
 
FINANCIAL SUMMARY
 
 
 
 
 
 
 
 
 
 
(unaudited, in millions, except per share statistics)
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
 
 
Mar 31,
2017
 
Dec 31,
2016
 
Sep 30,
2016
 
Jun 30,
2016
 
Mar 31,
2016
 
1Q'17 vs. 1Q'16
EARNINGS
 
 
 
 
 
 
 
 
 
 
 
 
Net interest income
$
3,587

 
$
3,628

 
$
3,481

 
$
3,212

 
$
3,209

 
$
378

11.8
 %
Retailer share arrangements
(684
)
 
(811
)
 
(757
)
 
(664
)
 
(670
)
 
(14
)
2.1
 %
Net interest income, after retailer share arrangements
2,903

 
2,817

 
2,724

 
2,548

 
2,539

 
364

14.3
 %
Provision for loan losses
1,306

 
1,076

 
986

 
1,021

 
903

 
403

44.6
 %
Net interest income, after retailer share arrangements and provision for loan losses
1,597

 
1,741

 
1,738

 
1,527

 
1,636

 
(39
)
(2.4
)%
Other income
93

 
85

 
84

 
83

 
92

 
1

1.1
 %
Other expense
908

 
918

 
859

 
839

 
800

 
108

13.5
 %
Earnings before provision for income taxes
782

 
908

 
963

 
771

 
928

 
(146
)
(15.7
)%
Provision for income taxes
283

 
332

 
359

 
282

 
346

 
(63
)
(18.2
)%
Net earnings
$
499

 
$
576

 
$
604

 
$
489

 
$
582

 
$
(83
)
(14.3
)%
Net earnings attributable to common stockholders
$
499

 
$
576

 
$
604

 
$
489

 
$
582

 
$
(83
)
(14.3
)%
 


 


 


 
 
 
 
 
 
 
COMMON SHARE STATISTICS
 
 
 
 
 
 
 
 
 
 
 
 
Basic EPS
$
0.61

 
$
0.70

 
$
0.73

 
$
0.59

 
$
0.70

 
$
(0.09
)
(12.9
)%
Diluted EPS
$
0.61

 
$
0.70

 
$
0.73

 
$
0.58

 
$
0.70

 
$
(0.09
)
(12.9
)%
Dividend declared per share
$
0.13

 
$
0.13

 
$
0.13

 
$

 
$

 
$
0.13

NM

Common stock price
$
34.30

 
$
36.27

 
$
28.00

 
$
25.28

 
$
28.66

 
$
5.64

19.7
 %
Book value per share
$
17.71

 
$
17.37

 
$
16.94

 
$
16.45

 
$
15.84

 
$
1.87

11.8
 %
Tangible common equity per share(1)
$
15.47

 
$
15.34

 
$
14.90

 
$
14.46

 
$
13.86

 
$
1.61

11.6
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
Beginning common shares outstanding
817.4

 
825.5

 
833.9

 
833.8

 
833.8

 
(16.4
)
(2.0
)%
Issuance of common shares

 

 

 

 

 

 %
Stock-based compensation

 

 
0.1

 
0.1

 

 

 %
Shares repurchased
(6.6
)
 
(8.1
)
 
(8.5
)
 

 

 
(6.6
)
NM

Ending common shares outstanding
810.8

 
817.4

 
825.5

 
833.9

 
833.8

 
(23.0
)
(2.8
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted average common shares outstanding
813.1

 
820.5

 
828.4

 
833.9

 
833.8

 
(20.7
)
(2.5
)%
Weighted average common shares outstanding (fully diluted)
817.1

 
823.8

 
830.6

 
836.2

 
835.5

 
(18.4
)
(2.2
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
(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.

1



SYNCHRONY FINANCIAL
 
 
 
 
 
 
 
 
 
 
SELECTED METRICS
 
 
 
 
 
 
 
 
 
 
 
 
(unaudited, $ in millions, except account data)
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
 
 
 
Mar 31,
2017
 
Dec 31,
2016
 
Sep 30,
2016
 
Jun 30,
2016
 
Mar 31,
2016
 
1Q'17 vs. 1Q'16
PERFORMANCE METRICS
 
 
 
 
 
 
 
 
 
 
 
 
Return on assets(1)
2.3
%
 
2.6
%
 
2.8
%
 
2.4
%
 
2.8
%
 


(0.5
)%
Return on equity(2)
14.1
%
 
16.2
%
 
17.3
%
 
14.5
%
 
18.1
%
 


(4.0
)%
Return on tangible common equity(3)
16.1
%
 
18.4
%
 
19.6
%
 
16.5
%
 
20.7
%
 


(4.6
)%
Net interest margin(4)
16.18
%
 
16.26
%
 
16.34
%
 
15.94
%
 
15.84
%
 


0.34
 %
Efficiency ratio(5)
30.3
%
 
31.6
%
 
30.6
%
 
31.9
%
 
30.4
%
 


(0.1
)%
Other expense as a % of average loan receivables, including held for sale
4.97
%
 
5.04
%
 
4.93
%
 
5.07
%
 
4.86
%
 


0.11
 %
Effective income tax rate
36.2
%
 
36.6
%
 
37.3
%
 
36.6
%
 
37.3
%
 


(1.1
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
CREDIT QUALITY METRICS
 
 
 
 
 
 
 
 
 
 
 
 
Net charge-offs as a % of average loan receivables, including held for sale
5.33
%
 
4.65
%
 
4.39
%
 
4.51
%
 
4.74
%
 


0.59
 %
30+ days past due as a % of period-end loan receivables(6)
4.25
%
 
4.32
%
 
4.26
%
 
3.79
%
 
3.85
%
 


0.40
 %
90+ days past due as a % of period-end loan receivables(6)
2.06
%
 
2.03
%
 
1.89
%
 
1.67
%
 
1.84
%
 


0.22
 %
Net charge-offs
$
974

 
$
847

 
$
765

 
$
747

 
$
780

 
$
194

24.9
 %
Loan receivables delinquent over 30 days(6)
$
3,120

 
$
3,295

 
$
3,008

 
$
2,585

 
$
2,538

 
$
582

22.9
 %
Loan receivables delinquent over 90 days(6)
$
1,508

 
$
1,546

 
$
1,334

 
$
1,143

 
$
1,212

 
$
296

24.4
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
Allowance for loan losses (period-end)
$
4,676

 
$
4,344

 
$
4,115

 
$
3,894

 
$
3,620

 
$
1,056

29.2
 %
Allowance coverage ratio(7)
6.37
%
 
5.69
%
 
5.82
%
 
5.70
%
 
5.50
%
 


0.87
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
BUSINESS METRICS
 
 
 
 
 
 
 
 
 
 
 
 
Purchase volume(8)
$
28,880

 
$
35,369

 
$
31,615

 
$
31,507

 
$
26,977

 
$
1,903

7.1
 %
Period-end loan receivables
$
73,350

 
$
76,337

 
$
70,644

 
$
68,282

 
$
65,849

 
$
7,501

11.4
 %
Credit cards
$
70,587

 
$
73,580

 
$
67,858

 
$
65,511

 
$
63,309

 
$
7,278

11.5
 %
Consumer installment loans
$
1,411

 
$
1,384

 
$
1,361

 
$
1,293

 
$
1,184

 
$
227

19.2
 %
Commercial credit products
$
1,311

 
$
1,333

 
$
1,385

 
$
1,389

 
$
1,318

 
$
(7
)
(0.5
)%
Other
$
41

 
$
40

 
$
40

 
$
89

 
$
38

 
$
3

7.9
 %
Average loan receivables, including held for sale
$
74,132

 
$
72,476

 
$
69,316

 
$
66,561

 
$
66,194

 
$
7,938

12.0
 %
Period-end active accounts (in thousands)(9)
67,905

 
71,890

 
66,781

 
66,491

 
64,689

 
3,216

5.0
 %
Average active accounts (in thousands)(9)
69,629

 
68,701

 
66,639

 
65,531

 
66,134

 
3,495

5.3
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
LIQUIDITY
 
 
 
 
 
 
 
 
 
 
 
 
Liquid assets
 
 
 
 
 
 
 
 
 
 
 
 
Cash and equivalents
$
11,392

 
$
9,321

 
$
13,588

 
$
11,787

 
$
12,500

 
$
(1,108
)
(8.9
)%
Total liquid assets
$
16,158

 
$
13,612

 
$
16,362

 
$
13,956

 
$
14,915

 
$
1,243

8.3
 %
Undrawn credit facilities
 
 
 
 
 
 
 
 
 
 
 
 
Undrawn credit facilities
$
5,600

 
$
6,700

 
$
7,150

 
$
7,025

 
$
7,325

 
$
(1,725
)
(23.5
)%
Total liquid assets and undrawn credit facilities
$
21,758

 
$
20,312

 
$
23,512

 
$
20,981

 
$
22,240

 
$
(482
)
(2.2
)%
Liquid assets % of total assets
18.14
%
 
15.09
%
 
18.77
%
 
16.94
%
 
18.27
%
 


(0.13
)%
Liquid assets including undrawn credit facilities % of total assets
24.43
%
 
22.52
%
 
26.98
%
 
25.47
%
 
27.24
%
 


(2.81
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(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, after retailer share arrangements, plus other income.
(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) Active accounts represent credit card or installment loan accounts on which there has been a purchase, payment or outstanding balance in the current month.

2



SYNCHRONY FINANCIAL
 
 
 
 
 
 
 
 
 
 
STATEMENTS OF EARNINGS
 
 
 
 
 
 
 
 
 
 
 
 
(unaudited, $ in millions)
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
 
 
 
Mar 31,
2017
 
Dec 31,
2016
 
Sep 30,
2016
 
Jun 30,
2016
 
Mar 31,
2016
 
1Q'17 vs. 1Q'16
Interest income:
 
 
 
 
 
 
 
 
 
 
 
 
Interest and fees on loans
$
3,877

 
$
3,919

 
$
3,771

 
$
3,494

 
$
3,498

 
$
379

10.8
 %
Interest on investment securities
36

 
28

 
25

 
21

 
22

 
14

63.6
 %
Total interest income
3,913

 
3,947

 
3,796

 
3,515

 
3,520

 
393

11.2
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest expense:
 
 
 
 
 
 
 
 
 
 
 
 
Interest on deposits
194

 
188

 
188

 
179

 
172

 
22

12.8
 %
Interest on borrowings of consolidated securitization entities
65

 
64

 
63

 
59

 
58

 
7

12.1
 %
Interest on third-party debt
67

 
67

 
64

 
65

 
81

 
(14
)
(17.3
)%
Total interest expense
326

 
319

 
315

 
303

 
311

 
15

4.8
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
Net interest income
3,587

 
3,628

 
3,481

 
3,212

 
3,209

 
378

11.8
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
Retailer share arrangements
(684
)
 
(811
)
 
(757
)
 
(664
)
 
(670
)
 
(14
)
2.1
 %
Net interest income, after retailer share arrangements
2,903

 
2,817

 
2,724

 
2,548

 
2,539

 
364

14.3
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
Provision for loan losses
1,306

 
1,076

 
986

 
1,021

 
903

 
403

44.6
 %
Net interest income, after retailer share arrangements and provision for loan losses
1,597

 
1,741

 
1,738

 
1,527

 
1,636

 
(39
)
(2.4
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
Other income:
 
 
 
 
 
 
 
 
 
 
 
 
Interchange revenue
145

 
167

 
154

 
151

 
130

 
15

11.5
 %
Debt cancellation fees
68

 
68

 
67

 
63

 
64

 
4

6.3
 %
Loyalty programs
(137
)
 
(157
)
 
(145
)
 
(135
)
 
(110
)
 
(27
)
24.5
 %
Other
17

 
7

 
8

 
4

 
8

 
9

112.5
 %
Total other income
93

 
85

 
84

 
83

 
92

 
1

1.1
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
Other expense:
 
 
 
 
 
 
 
 
 
 
 
 
Employee costs
325

 
315

 
311

 
301

 
280

 
45

16.1
 %
Professional fees
151

 
164

 
174

 
154

 
146

 
5

3.4
 %
Marketing and business development
94

 
130

 
92

 
107

 
94

 

 %
Information processing
90

 
88

 
87

 
81

 
82

 
8

9.8
 %
Other
248

 
221

 
195

 
196

 
198

 
50

25.3
 %
Total other expense
908

 
918

 
859

 
839

 
800

 
108

13.5
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
Earnings before provision for income taxes
782

 
908

 
963

 
771

 
928

 
(146
)
(15.7
)%
Provision for income taxes
283

 
332

 
359

 
282

 
346

 
(63
)
(18.2
)%
Net earnings attributable to common shareholders
$
499

 
$
576

 
$
604

 
$
489

 
$
582

 
$
(83
)
(14.3
)%
 
 
 
 
 
 
 
 
 
 
 
 
 


3



SYNCHRONY FINANCIAL
 
 
 
 
 
 
 
 
 
 
 
 
STATEMENTS OF FINANCIAL POSITION
 
 
 
 
 
 
 
 
 
 
(unaudited, $ in millions)
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
 
 
 
Mar 31,
2017
 
Dec 31,
2016
 
Sep 30,
2016
 
Jun 30,
2016
 
Mar 31,
2016
 
Mar 31, 2017 vs.
Mar 31, 2016
Assets
 
 
 
 
 
 
 
 
 
 
 
 
Cash and equivalents
$
11,392

 
$
9,321

 
$
13,588

 
$
11,787

 
$
12,500

 
$
(1,108
)
(8.9
)%
Investment securities
5,328

 
5,110

 
3,356

 
2,723

 
2,949

 
2,379

80.7
 %
Loan receivables:
 
 
 
 
 
 
 
 
 
 
 
 
Unsecuritized loans held for investment
50,398

 
52,332

 
47,517

 
44,854

 
41,730

 
8,668

20.8
 %
Restricted loans of consolidated securitization entities
22,952

 
24,005

 
23,127

 
23,428

 
24,119

 
(1,167
)
(4.8
)%
Total loan receivables
73,350

 
76,337

 
70,644

 
68,282

 
65,849

 
7,501

11.4
 %
Less: Allowance for loan losses
(4,676
)
 
(4,344
)
 
(4,115
)
 
(3,894
)
 
(3,620
)
 
(1,056
)
29.2
 %
Loan receivables, net
68,674

 
71,993

 
66,529

 
64,388

 
62,229

 
6,445

10.4
 %
Goodwill
992

 
949

 
949

 
949

 
949

 
43

4.5
 %
Intangible assets, net
826

 
712

 
733

 
704

 
702

 
124

17.7
 %
Other assets
1,838

 
2,122

 
2,004

 
1,833

 
2,327

 
(489
)
(21.0
)%
Total assets
$
89,050

 
$
90,207

 
$
87,159

 
$
82,384

 
$
81,656

 
$
7,394

9.1
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities and Equity
 
 
 
 
 
 
 
 
 
 
 
 
Deposits:
 
 
 
 
 
 
 
 
 
 
 
 
Interest-bearing deposit accounts
$
51,359

 
$
51,896

 
$
49,611

 
$
46,220

 
$
44,721

 
$
6,638

14.8
 %
Non-interest-bearing deposit accounts
246

 
159

 
204

 
207

 
256

 
(10
)
(3.9
)%
Total deposits
51,605

 
52,055

 
49,815

 
46,427

 
44,977

 
6,628

14.7
 %
Borrowings:
 
 
 
 
 
 
 
 
 
 
 
 
Borrowings of consolidated securitization entities
12,433

 
12,388

 
12,411

 
12,236

 
12,423

 
10

0.1
 %
Bank term loan

 

 

 

 
1,494

 
(1,494
)
NM

Senior unsecured notes
7,761

 
7,759

 
7,756

 
7,059

 
6,559

 
1,202

18.3
 %
Total borrowings
20,194

 
20,147

 
20,167

 
19,295

 
20,476

 
(282
)
(1.4
)%
Accrued expenses and other liabilities
2,888

 
3,809

 
3,196

 
2,947

 
2,999

 
(111
)
(3.7
)%
Total liabilities
74,687

 
76,011

 
73,178

 
68,669

 
68,452

 
6,235

9.1
 %
Equity:
 
 
 
 
 
 
 
 
 
 
 
 
Common stock
1

 
1

 
1

 
1

 
1

 

 %
Additional paid-in capital
9,405

 
9,393

 
9,381

 
9,370

 
9,359

 
46

0.5
 %
Retained earnings
5,724

 
5,330

 
4,861

 
4,364

 
3,875

 
1,849

47.7
 %
Accumulated other comprehensive income:
(55
)
 
(53
)
 
(24
)
 
(20
)
 
(31
)
 
(24
)
77.4
 %
Treasury Stock
(712
)
 
(475
)
 
(238
)
 

 

 
(712
)
NM

Total equity
14,363

 
14,196

 
13,981

 
13,715

 
13,204

 
1,159

8.8
 %
Total liabilities and equity
$
89,050

 
$
90,207

 
$
87,159

 
$
82,384

 
$
81,656

 
$
7,394

9.1
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 

4



SYNCHRONY FINANCIAL
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
AVERAGE BALANCES, NET INTEREST INCOME AND NET INTEREST MARGIN
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(unaudited, $ in millions)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
March 31, 2017
 
December 31, 2016
 
September 30, 2016
 
June 30, 2016
 
March 31, 2016
 
 
 
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
$
10,552

 
$
21

 
0.81
%
 
$
12,210

 
$
17

 
0.55
%
 
$
12,480

 
$
16

 
0.51
%
 
$
11,623

 
$
14

 
0.48
%
 
$
12,291

 
$
16

 
0.52
%
Securities available for sale
5,213

 
15

 
1.17
%
 
4,076

 
11

 
1.07
%
 
2,960

 
9

 
1.21
%
 
2,858

 
7

 
0.99
%
 
2,977

 
6

 
0.81
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loan receivables:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Credit cards, including held for sale
71,365

 
3,811

 
21.66
%
 
69,660

 
3,851

 
21.99
%
 
66,519

 
3,705

 
22.16
%
 
63,876

 
3,432

 
21.61
%
 
63,688

 
3,436

 
21.70
%
Consumer installment loans
1,389

 
32

 
9.34
%
 
1,373

 
31

 
8.98
%
 
1,333

 
31

 
9.25
%
 
1,233

 
28

 
9.13
%
 
1,154

 
27

 
9.41
%
Commercial credit products
1,317

 
34

 
10.47
%
 
1,386

 
36

 
10.33
%
 
1,401

 
35

 
9.94
%
 
1,388

 
33

 
9.56
%
 
1,313

 
35

 
10.72
%
Other
61

 

 
%
 
57

 
1

 
NM

 
63

 

 
%
 
64

 
1

 
NM

 
39

 

 
%
Total loan receivables, including held for sale
74,132

 
3,877

 
21.21
%
 
72,476

 
3,919

 
21.51
%
 
69,316

 
3,771

 
21.64
%
 
66,561

 
3,494

 
21.11
%
 
66,194

 
3,498

 
21.25
%
Total interest-earning assets
89,897

 
3,913

 
17.65
%
 
88,762

 
3,947

 
17.69
%
 
84,756

 
3,796

 
17.82
%
 
81,042

 
3,515

 
17.44
%
 
81,462

 
3,520

 
17.38
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Non-interest-earning assets:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and due from banks
802

 
 
 
 
 
739

 
 
 
 
 
862

 
 
 
 
 
895

 
 
 
 
 
1,367

 
 
 
 
Allowance for loan losses
(4,408
)
 
 
 
 
 
(4,228
)
 
 
 
 
 
(3,933
)
 
 
 
 
 
(3,732
)
 
 
 
 
 
(3,590
)
 
 
 
 
Other assets
3,177

 
 
 
 
 
3,479

 
 
 
 
 
3,189

 
 
 
 
 
3,208

 
 
 
 
 
3,271

 
 
 
 
Total non-interest-earning assets
(429
)
 
 
 
 
 
(10
)
 
 
 
 
 
118

 
 
 
 
 
371

 
 
 
 
 
1,048

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total assets
$
89,468

 
 
 
 
 
$
88,752

 
 
 
 
 
$
84,874

 
 
 
 
 
$
81,413

 
 
 
 
 
$
82,510

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest-bearing liabilities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest-bearing deposit accounts
$
51,829

 
$
194

 
1.52
%
 
$
51,006

 
$
188

 
1.47
%
 
$
47,895

 
$
188

 
1.56
%
 
$
45,523

 
$
179

 
1.58
%
 
$
44,304

 
$
172

 
1.56
%
Borrowings of consolidated securitization entities
12,321

 
65

 
2.14
%
 
12,389

 
64

 
2.06
%
 
12,254

 
63

 
2.05
%
 
12,211

 
59

 
1.94
%
 
12,860

 
58

 
1.81
%
Bank term loan(1)

 

 
%
 

 

 
%
 

 

 
%
 
65

 
7

 
NM

 
2,170

 
24

 
4.45
%
Senior unsecured notes
7,760

 
67

 
3.50
%
 
7,757

 
67

 
3.44
%
 
7,448

 
64

 
3.42
%
 
6,861

 
58

 
3.40
%
 
6,557

 
57

 
3.50
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total interest-bearing liabilities
71,910

 
326

 
1.84
%
 
71,152

 
319

 
1.78
%
 
67,597

 
315

 
1.85
%
 
64,660

 
303

 
1.88
%
 
65,891

 
311

 
1.90
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Non-interest-bearing liabilities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Non-interest-bearing deposit accounts
240

 
 
 
 
 
176

 
 
 
 
 
204

 
 
 
 
 
208

 
 
 
 
 
235

 
 
 
 
Other liabilities
2,995

 
 
 
 
 
3,321

 
 
 
 
 
3,175

 
 
 
 
 
3,002

 
 
 
 
 
3,455

 
 
 
 
Total non-interest-bearing liabilities
3,235

 
 
 
 
 
3,497

 
 
 
 
 
3,379

 
 
 
 
 
3,210

 
 
 
 
 
3,690

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total liabilities
75,145

 
 
 
 
 
74,649

 
 
 
 
 
70,976

 
 
 
 
 
67,870

 
 
 
 
 
69,581

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equity
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total equity
14,323

 
 
 
 
 
14,103

 
 
 
 
 
13,898

 
 
 
 
 
13,543

 
 
 
 
 
12,929

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total liabilities and equity
$
89,468

 
 
 
 
 
$
88,752

 
 
 
 
 
$
84,874

 
 
 
 
 
$
81,413

 
 
 
 
 
$
82,510

 
 
 
 
Net interest income
 
 
$
3,587

 
 
 
 
 
$
3,628

 
 
 
 
 
$
3,481

 
 
 
 
 
$
3,212

 
 
 
 
 
$
3,209

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate spread(2)
 
 
 
 
15.81
%
 
 
 
 
 
15.91
%
 
 
 
 
 
15.97
%
 
 
 
 
 
15.56
%
 
 
 
 
 
15.48
%
Net interest margin(3)
 
 
 
 
16.18
%
 
 
 
 
 
16.26
%
 
 
 
 
 
16.34
%
 
 
 
 
 
15.94
%
 
 
 
 
 
15.84
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) The effective interest rates for the Bank term loan for the quarters ended June 30, 2016, March 31, 2016 were 2.51% and 2.47% respectively. The Bank term loan effective rate excludes the impact of charges incurred in connection with prepayments of the loan.
(2) Interest rate spread represents the difference between the yield on total interest-earning assets and the rate on total interest-bearing liabilities.
(3) Net interest margin represents net interest income divided by average interest-earning assets.
 
 
 
 
 
 
 
 
 
 
 
 

5



SYNCHRONY FINANCIAL
 
 
 
 
 
 
 
 
 
 
BALANCE SHEET STATISTICS
 
 
 
 
 
 
 
 
 
 
 
 
(unaudited, $ in millions, except per share statistics)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
 
 
 
Mar 31,
2017
 
Dec 31,
2016
 
Sep 30,
2016
 
Jun 30,
2016
 
Mar 31,
2016
 
Mar 31, 2017 vs.
Mar 31, 2016
BALANCE SHEET STATISTICS
 
 
 
 
 
 
 
 
 
 
 
 
Total common equity
$
14,363

 
$
14,196

 
$
13,981

 
$
13,715

 
$
13,204

 
$
1,159

8.8
 %
Total common equity as a % of total assets
16.13
%
 
15.74
%
 
16.04
%
 
16.65
%
 
16.17
%
 

(0.04
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
Tangible assets
$
87,232

 
$
88,546

 
$
85,477

 
$
80,731

 
$
80,005

 
$
7,227

9.0
 %
Tangible common equity(1)
$
12,545

 
$
12,535

 
$
12,299

 
$
12,062

 
$
11,553

 
$
992

8.6
 %
Tangible common equity as a % of tangible assets(1)
14.38
%
 
14.16
%
 
14.39
%
 
14.94
%
 
14.44
%
 

(0.06
)%
Tangible common equity per share(1)
$
15.47

 
$
15.34

 
$
14.90

 
$
14.46

 
$
13.86

 
$
1.61

11.6
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
REGULATORY CAPITAL RATIOS(2)
 
 
 
 
 
 
 
 
 
 
 
 

Basel III Transition
 
 
 
Total risk-based capital ratio(3)
19.3
%
 
18.5
%
 
19.5
%
 
19.8
%
 
19.4
%
 
 
 
Tier 1 risk-based capital ratio(4)
18.0
%
 
17.2
%
 
18.2
%
 
18.5
%
 
18.1
%
 
 
 
Tier 1 leverage ratio(5)
14.8
%
 
15.0
%
 
15.4
%
 
15.7
%
 
14.9
%
 
 
 
Common equity Tier 1 capital ratio(6)
18.0
%
 
17.2
%
 
18.2
%
 
18.5
%
 
18.1
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Basel III Fully Phased-in
 
 
 
Common equity Tier 1 capital ratio(6)
17.7
%
 
17.0
%
 
17.9
%
 
18.0
%
 
17.5
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(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 March 31, 2017 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.
(6) Common equity Tier 1 capital ratio is the ratio of common equity Tier 1 capital to total risk-weighted assets, each as calculated under Basel III rules. Common equity Tier 1 capital ratio (fully phased-in) is a preliminary estimate reflecting management’s interpretation of the final Basel III rules adopted in July 2013 by the Federal Reserve Board, which have not been fully implemented, and our estimate and interpretations are subject to, among other things, ongoing regulatory review and implementation guidance.

 
 
 
 
 
 
 
 
 
 
 
 
 

6



SYNCHRONY FINANCIAL
 
 
 
 
 
 
 
 
 
 
PLATFORM RESULTS
 
 
 
 
 
(unaudited, $ in millions)
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
 
 
 
Mar 31,
2017
 
Dec 31,
2016
 
Sep 30,
2016
 
Jun 30,
2016
 
Mar 31,
2016
 
1Q'17 vs. 1Q'16
RETAIL CARD
 
 
 
 
 
 
 
 
 
 
 
 
Purchase volume(1)(2)
$
22,952

 
$
28,996

 
$
25,285

 
$
25,411

 
$
21,550

 
$
1,402

6.5
 %
Period-end loan receivables
$
49,905

 
$
52,701

 
$
48,010

 
$
46,705

 
$
45,113

 
$
4,792

10.6
 %
Average loan receivables, including held for sale
$
50,644

 
$
49,476

 
$
47,274

 
$
45,593

 
$
45,479

 
$
5,165

11.4
 %
Average active accounts (in thousands)(2)(3)
55,049

 
54,489

 
52,959

 
52,314

 
52,969

 
2,080

3.9
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest and fees on loans(2)
$
2,888

 
$
2,909

 
$
2,790

 
$
2,585

 
$
2,614

 
$
274

10.5
 %
Other income(2)
$
77

 
$
70

 
$
70

 
$
69

 
$
79

 
$
(2
)
(2.5
)%
Retailer share arrangements(2)
$
(681
)
 
$
(801
)
 
$
(752
)
 
$
(656
)
 
$
(661
)
 
$
(20
)
3.0
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
PAYMENT SOLUTIONS
 
 
 
 
 
 
 
 
 
 
 
 
Purchase volume(1)
$
3,686

 
$
4,194

 
$
4,152

 
$
3,903

 
$
3,392

 
$
294

8.7
 %
Period-end loan receivables
$
15,320

 
$
15,567

 
$
14,798

 
$
13,997

 
$
13,420

 
$
1,900

14.2
 %
Average loan receivables
$
15,424

 
$
15,076

 
$
14,367

 
$
13,554

 
$
13,430

 
$
1,994

14.8
 %
Average active accounts (in thousands)(3)
9,090

 
8,844

 
8,461

 
8,153

 
8,134

 
956

11.8
 %
 

 
 
 
 
 
 
 
 
 
 
 
Interest and fees on loans
$
515

 
$
523

 
$
505

 
$
467

 
$
457

 
$
58

12.7
 %
Other income
$
4

 
$
3

 
$
3

 
$
3

 
$
4

 
$

 %
Retailer share arrangements
$
(1
)
 
$
(9
)
 
$
(3
)
 
$
(7
)
 
$
(7
)
 
$
6

(85.7
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
CARECREDIT
 
 
 
 
 
 
 
 
 
 
 
 
Purchase volume(1)
$
2,242

 
$
2,179

 
$
2,178

 
$
2,193

 
$
2,035

 
$
207

10.2
 %
Period-end loan receivables
$
8,125

 
$
8,069

 
$
7,836

 
$
7,580

 
$
7,316

 
$
809

11.1
 %
Average loan receivables
$
8,064

 
$
7,924

 
$
7,675

 
$
7,414

 
$
7,285

 
$
779

10.7
 %
Average active accounts (in thousands)(3)
5,490

 
5,368

 
5,219

 
5,064

 
5,031

 
459

9.1
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest and fees on loans
$
474

 
$
487

 
$
476

 
$
442

 
$
427

 
$
47

11.0
 %
Other income
$
12

 
$
12

 
$
11

 
$
11

 
$
9

 
$
3

33.3
 %
Retailer share arrangements
$
(2
)
 
$
(1
)
 
$
(2
)
 
$
(1
)
 
$
(2
)
 
$

 %
 
 
 
 
 
 
 
 
 
 
 
 
 
TOTAL SYF
 
 
 
 
 
 
 
 
 
 
 
 
Purchase volume(1)(2)
$
28,880

 
$
35,369

 
$
31,615

 
$
31,507

 
$
26,977

 
$
1,903

7.1
 %
Period-end loan receivables
$
73,350

 
$
76,337

 
$
70,644

 
$
68,282

 
$
65,849

 
$
7,501

11.4
 %
Average loan receivables, including held for sale
$
74,132

 
$
72,476

 
$
69,316

 
$
66,561

 
$
66,194

 
$
7,938

12.0
 %
Average active accounts (in thousands)(2)(3)
69,629

 
68,701

 
66,639

 
65,531

 
66,134

 
3,495

5.3
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest and fees on loans(2)
$
3,877

 
$
3,919

 
$
3,771

 
$
3,494

 
$
3,498

 
$
379

10.8
 %
Other income(2)
$
93

 
$
85

 
$
84

 
$
83

 
$
92

 
$
1

1.1
 %
Retailer share arrangements(2)
$
(684
)
 
$
(811
)
 
$
(757
)
 
$
(664
)
 
$
(670
)
 
$
(14
)
2.1
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) 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.
(2) Includes activity and balances associated with loan receivables held for sale.
 
 
 
 
 
 
 
 
 
 
 
 
(3) Active accounts represent credit card or installment loan accounts on which there has been a purchase, payment or outstanding balance in the current month.

7



SYNCHRONY FINANCIAL
 
 
 
 
 
 
 
 
 
RECONCILIATION OF NON-GAAP MEASURES AND CALCULATIONS OF REGULATORY MEASURES(1)
 
 
(unaudited, $ in millions, except per share statistics)
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
Mar 31,
2017
 
Dec 31,
2016
 
Sep 30,
2016
 
Jun 30,
2016
 
Mar 31,
2016
COMMON EQUITY MEASURES
 
 
 
 
 
 
 
 
 
GAAP Total common equity
$
14,363

 
$
14,196

 
$
13,981

 
$
13,715

 
$
13,204

Less: Goodwill
(992
)
 
(949
)
 
(949
)
 
(949
)
 
(949
)
Less: Intangible assets, net
(826
)
 
(712
)
 
(733
)
 
(704
)
 
(702
)
Tangible common equity
$
12,545

 
$
12,535

 
$
12,299

 
$
12,062

 
$
11,553

 
 
 
 
 
 
 
 
 
 
Adjustments for certain deferred tax liabilities and certain items in accumulated comprehensive income (loss)
340

 
337

 
299

 
282

 
281

Basel III - Common equity Tier 1 (fully phased-in)
$
12,885

 
$
12,872

 
$
12,598

 
$
12,344

 
$
11,834

Adjustment related to capital components during transition
154

 
263

 
273

 
266

 
265

Basel III - Common equity Tier I (transition)
$
13,039

 
$
13,135

 
$
12,871

 
$
12,610

 
$
12,099

 
 
 
 
 
 
 
 
 
 
RISK-BASED CAPITAL
 
 
 
 
 
 
 
 
 
Common equity Tier 1
$
13,039

 
$
13,135

 
$
12,871

 
$
12,610

 
$
12,099

Add: Allowance for loan losses includible in risk-based capital
954

 
994

 
923

 
890

 
869

Risk-based capital
$
13,993

 
$
14,129

 
$
13,794

 
$
13,500

 
$
12,968

 
 
 
 
 
 
 
 
 
 
ASSET MEASURES
 
 
 
 
 
 
 
 
 
Total average assets(2)
$
89,468

 
$
88,752

 
$
84,874

 
$
81,413

 
$
82,510

Adjustments for:
 
 
 
 
 
 
 
 
 
Disallowed goodwill, other disallowed intangible assets
(net of related deferred tax liabilities) and other
(1,358
)
 
(1,059
)
 
(1,117
)
 
(1,113
)
 
(1,117
)
Total assets for leverage purposes
$
88,110

 
$
87,693

 
$
83,757

 
$
80,300

 
$
81,393

 
 
 
 
 
 
 
 
 
 
Risk-weighted assets - Basel III (fully phased-in)(3)
$
72,596

 
$
75,941

 
$
70,448

 
$
68,462

 
$
67,697

Risk-weighted assets - Basel III (transition)(3)
$
72,627

 
$
76,179

 
$
70,660

 
$
68,188

 
$
66,689

 
 
 
 
 
 
 
 
 
 
TANGIBLE COMMON EQUITY PER SHARE
 
 
 
 
 
 
 
 
 
GAAP book value per share
$
17.71

 
$
17.37

 
$
16.94

 
$
16.45

 
$
15.84

Less: Goodwill
(1.22
)
 
(1.16
)
 
(1.14
)
 
(1.14
)
 
(1.14
)
Less: Intangible assets, net
(1.02
)
 
(0.87
)
 
(0.90
)
 
(0.85
)
 
(0.84
)
Tangible common equity per share
$
15.47

 
$
15.34

 
$
14.90

 
$
14.46

 
$
13.86

 
 
 
 
 
 
 
 
 
 
 
(1) Regulatory measures at March 31, 2017 are presented on an estimated basis.
(2) Total average assets are presented based upon the use of daily averages.
(3) Key differences between Basel III transitional rules and fully phased-in Basel III rules in the calculation of risk-weighted assets include, but not limited to, risk weighting of deferred tax assets and adjustments for certain intangible assets.



8