Exhibit 99.2


SYNCHRONY FINANCIAL
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
FINANCIAL SUMMARY
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(unaudited, in millions, except per share statistics)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
 
 
 
Six Months Ended
 
 
 
 
Jun 30,
2020
 
Mar 31,
2020
 
Dec 31,
2019
 
Sep 30,
2019
 
Jun 30,
2019
 
2Q'20 vs. 2Q'19
 
Jun 30,
2020
 
Jun 30,
2019
 
YTD'20 vs. YTD'19
EARNINGS
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net interest income
$
3,396

 
$
3,890

 
$
4,029

 
$
4,389

 
$
4,155

 
$
(759
)
(18.3
)%
 
$
7,286

 
$
8,381

 
$
(1,095
)
(13.1
)%
Retailer share arrangements
(773
)
 
(926
)
 
(1,029
)
 
(1,016
)
 
(859
)
 
86

(10.0
)%
 
(1,699
)
 
(1,813
)
 
114

(6.3
)%
Provision for credit losses
1,673

 
1,677

 
1,104

 
1,019

 
1,198

 
475

39.6
 %
 
3,350

 
2,057

 
1,293

62.9
 %
Net interest income, after retailer share arrangements and provision for credit losses
950

 
1,287

 
1,896

 
2,354

 
2,098

 
(1,148
)
(54.7
)%
 
2,237

 
4,511

 
(2,274
)
(50.4
)%
Other income
95

 
97

 
104

 
85

 
90

 
5

5.6
 %
 
192

 
182

 
10

5.5
 %
Other expense
986

 
1,002

 
1,079

 
1,064

 
1,059

 
(73
)
(6.9
)%
 
1,988

 
2,102

 
(114
)
(5.4
)%
Earnings before provision for income taxes
59

 
382

 
921

 
1,375

 
1,129

 
(1,070
)
(94.8
)%
 
441

 
2,591

 
(2,150
)
(83.0
)%
Provision for income taxes
11

 
96

 
190

 
319

 
276

 
(265
)
(96.0
)%
 
107

 
631

 
(524
)
(83.0
)%
Net earnings
$
48

 
$
286

 
$
731

 
$
1,056

 
$
853

 
$
(805
)
(94.4
)%
 
$
334

 
$
1,960

 
$
(1,626
)
(83.0
)%
Net earnings available to common stockholders
$
37

 
$
275

 
$
731

 
$
1,056

 
$
853

 
$
(816
)
(95.7
)%
 
$
312

 
$
1,960


$
(1,648
)
(84.1
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 


 


 


 
 
 
 
 
 
 
 


 


 


 
COMMON SHARE STATISTICS
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic EPS
$
0.06

 
$
0.45

 
$
1.15

 
$
1.60

 
$
1.25

 
$
(1.19
)
(95.2
)%
 
$
0.52

 
$
2.82

 
$
(2.30
)
(81.6
)%
Diluted EPS
$
0.06

 
$
0.45

 
$
1.15

 
$
1.60

 
$
1.24

 
$
(1.18
)
(95.2
)%
 
$
0.52

 
$
2.81

 
$
(2.29
)
(81.5
)%
Dividend declared per share
$
0.22

 
$
0.22

 
$
0.22

 
$
0.22

 
$
0.21

 
$
0.01

4.8
 %
 
$
0.44

 
$
0.42

 
$
0.02

4.8
 %
Common stock price
$
22.16

 
$
16.09

 
$
36.01

 
$
34.09

 
$
34.67

 
$
(12.51
)
(36.1
)%
 
$
22.16

 
$
34.67

 
$
(12.51
)
(36.1
)%
Book value per share
$
19.13

 
$
19.27

 
$
23.31

 
$
23.13

 
$
22.03

 
$
(2.90
)
(13.2
)%
 
$
19.13

 
$
22.03

 
$
(2.90
)
(13.2
)%
Tangible common equity per share(1)
$
15.28

 
$
15.35

 
$
19.50

 
$
19.68

 
$
18.60

 
$
(3.32
)
(17.8
)%
 
$
15.28

 
$
18.60

 
$
(3.32
)
(17.8
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Beginning common shares outstanding
583.2

 
615.9

 
653.7

 
668.9

 
688.8

 
(105.6
)
(15.3
)%
 
615.9

 
718.8

 
(102.9
)
(14.3
)%
Issuance of common shares

 

 

 

 

 

 %
 

 

 

 %
Stock-based compensation
0.5

 
0.9

 
0.6

 
0.4

 
1.2

 
(0.7
)
(58.3
)%
 
1.4

 
2.1

 
(0.7
)
(33.3
)%
Shares repurchased

 
(33.6
)
 
(38.4
)
 
(15.6
)
 
(21.1
)
 
21.1

(100.0
)%
 
(33.6
)
 
(52.0
)
 
18.4

(35.4
)%
Ending common shares outstanding
583.7

 
583.2

 
615.9

 
653.7

 
668.9

 
(85.2
)
(12.7
)%
 
583.7

 
668.9

 
(85.2
)
(12.7
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted average common shares outstanding
583.7

 
604.9

 
633.7

 
658.3

 
683.6

 
(99.9
)
(14.6
)%
 
594.3

 
694.8

 
(100.5
)
(14.5
)%
Weighted average common shares outstanding (fully diluted)
584.4

 
607.4

 
637.7

 
661.7

 
686.5

 
(102.1
)
(14.9
)%
 
595.9

 
697.7

 
(101.8
)
(14.6
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(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)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
 
 
 
Six Months Ended
 
 
 
 
Jun 30,
2020
 
Mar 31,
2020
 
Dec 31,
2019
 
Sep 30,
2019
 
Jun 30,
2019
 
2Q'20 vs. 2Q'19
 
Jun 30,
2020
 
Jun 30,
2019
 
YTD'20 vs. YTD'19
PERFORMANCE METRICS
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Return on assets(1)
0.2
%
 
1.1
%
 
2.7
%
 
3.9
%
 
3.3
%
 


(3.1
)%
 
0.7
%
 
3.8
%
 


(3.1
)%
Return on equity(2)
1.6
%
 
9.1
%
 
19.0
%
 
28.3
%
 
23.1
%
 


(21.5
)%
 
5.4
%
 
26.7
%
 


(21.3
)%
Return on tangible common equity(3)
1.6
%
 
11.6
%
 
23.0
%
 
33.4
%
 
27.4
%
 


(25.8
)%
 
6.7
%
 
31.6
%
 


(24.9
)%
Net interest margin(4)
13.53
%
 
15.15
%
 
15.01
%
 
16.29
%
 
15.75
%
 


(2.22
)%
 
14.35
%
 
15.92
%
 


(1.57
)%
Efficiency ratio(5)
36.3
%
 
32.7
%
 
34.8
%
 
30.8
%
 
31.3
%
 


5.0
 %
 
34.4
%
 
31.1
%
 


3.3
 %
Other expense as a % of average loan receivables, including held for sale
5.04
%
 
4.77
%
 
5.01
%
 
4.66
%
 
4.78
%
 


0.26
 %
 
4.90
%
 
4.74
%
 


0.16
 %
Effective income tax rate
18.6
%
 
25.1
%
 
20.6
%
 
23.2
%
 
24.4
%
 


(5.8
)%
 
24.3
%
 
24.4
%
 


(0.1
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
CREDIT QUALITY METRICS
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net charge-offs as a % of average loan receivables, including held for sale
5.35
%
 
5.36
%
 
5.15
%
 
5.35
%
 
6.01
%
 


(0.66
)%
 
5.35
%
 
6.04
%
 


(0.69
)%
30+ days past due as a % of period-end loan receivables(6)
3.13
%
 
4.24
%
 
4.44
%
 
4.47
%
 
4.43
%
 


(1.30
)%
 
3.13
%
 
4.43
%
 


(1.30
)%
90+ days past due as a % of period-end loan receivables(6)
1.77
%
 
2.10
%
 
2.15
%
 
2.07
%
 
2.16
%
 


(0.39
)%
 
1.77
%
 
2.16
%
 


(0.39
)%
Net charge-offs
$
1,046

 
$
1,125

 
$
1,109

 
$
1,221

 
$
1,331

 
$
(285
)
(21.4
)%
 
$
2,171

 
$
2,675

 
$
(504
)
(18.8
)%
Loan receivables delinquent over 30 days(6)
$
2,453

 
$
3,500

 
$
3,874

 
$
3,723

 
$
3,625

 
$
(1,172
)
(32.3
)%
 
$
2,453

 
$
3,625

 
$
(1,172
)
(32.3
)%
Loan receivables delinquent over 90 days(6)
$
1,384

 
$
1,735

 
$
1,877

 
$
1,723

 
$
1,768

 
$
(384
)
(21.7
)%
 
$
1,384

 
$
1,768

 
$
(384
)
(21.7
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Allowance for credit losses (period-end)
$
9,802

 
$
9,175

 
$
5,602

 
$
5,607

 
$
5,809

 
$
3,993

68.7
 %
 
$
9,802

 
$
5,809

 
$
3,993

68.7
 %
Allowance coverage ratio(7)
12.52
%
 
11.13
%
 
6.42
%
 
6.74
%
 
7.10
%
 


5.42
 %
 
12.52
%
 
7.10
%
 


5.42
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
BUSINESS METRICS
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Purchase volume(8)(9)
$
31,155

 
$
32,042

 
$
40,212

 
$
38,395

 
$
38,291

 
$
(7,136
)
(18.6
)%
 
$
63,197

 
$
70,804

 
$
(7,607
)
(10.7
)%
Period-end loan receivables
$
78,313

 
$
82,469

 
$
87,215

 
$
83,207

 
$
81,796

 
$
(3,483
)
(4.3
)%
 
$
78,313

 
$
81,796

 
$
(3,483
)
(4.3
)%
Credit cards
$
75,353

 
$
79,832

 
$
84,606

 
$
79,788

 
$
78,446

 
$
(3,093
)
(3.9
)%
 
$
75,353

 
$
78,446

 
$
(3,093
)
(3.9
)%
Consumer installment loans
$
1,779

 
$
1,390

 
$
1,347

 
$
2,050

 
$
1,983

 
$
(204
)
(10.3
)%
 
$
1,779

 
$
1,983

 
$
(204
)
(10.3
)%
Commercial credit products
$
1,140

 
$
1,203

 
$
1,223

 
$
1,317

 
$
1,328

 
$
(188
)
(14.2
)%
 
$
1,140

 
$
1,328

 
$
(188
)
(14.2
)%
Other
$
41

 
$
44

 
$
39

 
$
52

 
$
39

 
$
2

5.1
 %
 
$
41

 
$
39

 
$
2

5.1
 %
Average loan receivables, including held for sale
$
78,697

 
$
84,428

 
$
85,376

 
$
90,556

 
$
88,792

 
$
(10,095
)
(11.4
)%
 
$
81,563

 
$
89,344

 
$
(7,781
)
(8.7
)%
Period-end active accounts (in thousands)(9)(10)
63,430

 
68,849

 
75,471

 
77,094

 
76,065

 
(12,635
)
(16.6
)%
 
63,430

 
76,065

 
(12,635
)
(16.6
)%
Average active accounts (in thousands)(9)(10)
64,836

 
72,078

 
73,734

 
76,695

 
75,525

 
(10,689
)
(14.2
)%
 
68,401

 
76,545

 
(8,144
)
(10.6
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
LIQUIDITY
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Liquid assets
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and equivalents
$
16,344

 
$
13,704

 
$
12,147

 
$
11,461

 
$
11,755

 
$
4,589

39.0
 %
 
$
16,344

 
$
11,755

 
$
4,589

39.0
 %
Total liquid assets
$
22,352

 
$
19,225

 
$
17,322

 
$
15,201

 
$
16,665

 
$
5,687

34.1
 %
 
$
22,352

 
$
16,665

 
$
5,687

34.1
 %
Undrawn credit facilities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Undrawn credit facilities
$
5,650

 
$
5,600

 
$
6,050

 
$
6,500

 
$
7,050

 
$
(1,400
)
(19.9
)%
 
$
5,650

 
$
7,050

 
$
(1,400
)
(19.9
)%
Total liquid assets and undrawn credit facilities
$
28,002

 
$
24,825

 
$
23,372

 
$
21,701

 
$
23,715

 
$
4,287

18.1
 %
 
$
28,002

 
$
23,715

 
$
4,287

18.1
 %
Liquid assets % of total assets
23.15
%
 
19.61
%
 
16.52
%
 
14.35
%
 
15.66
%
 


7.49
 %
 
23.15
%
 
15.66
%
 


7.49
 %
Liquid assets including undrawn credit facilities % of total assets
29.00
%
 
25.32
%
 
22.30
%
 
20.48
%
 
22.29
%
 


6.71
 %
 
29.00
%
 
22.29
%
 


6.71
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(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 available to common stockholders 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 credit 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.
 
 
 
 
 
 
 

2



SYNCHRONY FINANCIAL
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
STATEMENTS OF EARNINGS
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(unaudited, $ in millions)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
 
 
 
Six Months Ended
 
 
 
 
Jun 30,
2020
 
Mar 31,
2020
 
Dec 31,
2019
 
Sep 30,
2019
 
Jun 30,
2019
 
2Q'20 vs. 2Q'19
 
Jun 30,
2020
 
Jun 30,
2019
 
YTD'20 vs. YTD'19
Interest income:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest and fees on loans
$
3,808

 
$
4,340

 
$
4,492

 
$
4,890

 
$
4,636

 
$
(828
)
(17.9
)%
 
$
8,148

 
$
9,323

 
$
(1,175
)
(12.6
)%
Interest on cash and debt securities
22

 
67

 
93

 
91

 
102

 
(80
)
(78.4
)%
 
89

 
201

 
(112
)
(55.7
)%
Total interest income
3,830

 
4,407

 
4,585

 
4,981

 
4,738

 
(908
)
(19.2
)%
 
8,237

 
9,524

 
(1,287
)
(13.5
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest expense:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest on deposits
293

 
356

 
383

 
411

 
397

 
(104
)
(26.2
)%
 
649

 
772

 
(123
)
(15.9
)%
Interest on borrowings of consolidated securitization entities
59

 
73

 
80

 
88

 
90

 
(31
)
(34.4
)%
 
132

 
190

 
(58
)
(30.5
)%
Interest on senior unsecured notes
82

 
88

 
93

 
93

 
96

 
(14
)
(14.6
)%
 
170

 
181

 
(11
)
(6.1
)%
Total interest expense
434

 
517

 
556

 
592

 
583

 
(149
)
(25.6
)%
 
951

 
1,143

 
(192
)
(16.8
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net interest income
3,396

 
3,890

 
4,029

 
4,389

 
4,155

 
(759
)
(18.3
)%
 
7,286

 
8,381

 
(1,095
)
(13.1
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Retailer share arrangements
(773
)
 
(926
)
 
(1,029
)
 
(1,016
)
 
(859
)
 
86

(10.0
)%
 
(1,699
)
 
(1,813
)
 
114

(6.3
)%
Provision for credit losses
1,673

 
1,677

 
1,104

 
1,019

 
1,198

 
475

39.6
 %
 
3,350

 
2,057

 
1,293

62.9
 %
Net interest income, after retailer share arrangements and provision for credit losses
950

 
1,287

 
1,896

 
2,354

 
2,098

 
(1,148
)
(54.7
)%
 
2,237

 
4,511

 
(2,274
)
(50.4
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Other income:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interchange revenue
134

 
161

 
192

 
197

 
194

 
(60
)
(30.9
)%
 
295

 
359

 
(64
)
(17.8
)%
Debt cancellation fees
69

 
69

 
64

 
64

 
69

 

 %
 
138

 
137

 
1

0.7
 %
Loyalty programs
(134
)
 
(158
)
 
(181
)
 
(203
)
 
(192
)
 
58

(30.2
)%
 
(292
)
 
(359
)
 
67

(18.7
)%
Other
26

 
25

 
29

 
27

 
19

 
7

36.8
 %
 
51

 
45

 
6

13.3
 %
Total other income
95

 
97

 
104

 
85

 
90

 
5

5.6
 %
 
192

 
182

 
10

5.5
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Other expense:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Employee costs
327

 
324

 
385

 
359

 
358

 
(31
)
(8.7
)%
 
651

 
711

 
(60
)
(8.4
)%
Professional fees
189

 
197

 
199

 
205

 
231

 
(42
)
(18.2
)%
 
386

 
463

 
(77
)
(16.6
)%
Marketing and business development
91

 
111

 
152

 
139

 
135

 
(44
)
(32.6
)%
 
202

 
258

 
(56
)
(21.7
)%
Information processing
116

 
123

 
122

 
127

 
123

 
(7
)
(5.7
)%
 
239

 
236

 
3

1.3
 %
Other
263

 
247

 
221

 
234

 
212

 
51

24.1
 %
 
510

 
434

 
76

17.5
 %
Total other expense
986

 
1,002

 
1,079

 
1,064

 
1,059

 
(73
)
(6.9
)%
 
1,988

 
2,102

 
(114
)
(5.4
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Earnings before provision for income taxes
59

 
382

 
921

 
1,375

 
1,129

 
(1,070
)
(94.8
)%
 
441

 
2,591

 
(2,150
)
(83.0
)%
Provision for income taxes
11

 
96

 
190

 
319

 
276

 
(265
)
(96.0
)%
 
107

 
631

 
(524
)
(83.0
)%
Net earnings
$
48

 
$
286

 
$
731

 
$
1,056

 
$
853

 
$
(805
)
(94.4
)%
 
$
334

 
$
1,960

 
$
(1,626
)
(83.0
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net earnings available to common stockholders
$
37

 
$
275

 
$
731

 
$
1,056

 
$
853

 
$
(816
)
(95.7
)%
 
$
312

 
$
1,960

 
$
(1,648
)
(84.1
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 


3



SYNCHRONY FINANCIAL
 
 
 
 
 
 
 
 
 
 
 
 
STATEMENTS OF FINANCIAL POSITION
 
 
 
 
 
 
 
 
 
 
(unaudited, $ in millions)
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
 
 
 
Jun 30,
2020
 
Mar 31,
2020
 
Dec 31,
2019
 
Sep 30,
2019
 
Jun 30,
2019
 
Jun 30, 2020 vs. Jun 30, 2019
Assets
 
 
 
 
 
 
 
 
 
 
 
 
Cash and equivalents
$
16,344

 
$
13,704

 
$
12,147

 
$
11,461

 
$
11,755

 
$
4,589

39.0
 %
Debt securities
6,623

 
6,146

 
5,911

 
4,584

 
6,147

 
476

7.7
 %
Loan receivables:
 
 
 
 
 
 
 
 
 
 
 
 
Unsecuritized loans held for investment
52,629

 
54,765

 
58,398

 
56,220

 
55,178

 
(2,549
)
(4.6
)%
Restricted loans of consolidated securitization entities
25,684

 
27,704

 
28,817

 
26,987

 
26,618

 
(934
)
(3.5
)%
Total loan receivables
78,313

 
82,469

 
87,215

 
83,207

 
81,796

 
(3,483
)
(4.3
)%
Less: Allowance for credit losses(1)
(9,802
)
 
(9,175
)
 
(5,602
)
 
(5,607
)
 
(5,809
)
 
(3,993
)
68.7
 %
Loan receivables, net
68,511

 
73,294

 
81,613

 
77,600

 
75,987

 
(7,476
)
(9.8
)%
Loan receivables held for sale
4

 
5

 
725

 
8,182

 
8,096

 
(8,092
)
(100.0
)%
Goodwill
1,078

 
1,078

 
1,078

 
1,078

 
1,078

 

 %
Intangible assets, net
1,166

 
1,208

 
1,265

 
1,177

 
1,215

 
(49
)
(4.0
)%
Other assets
2,818

 
2,603

 
2,087

 
1,861

 
2,110

 
708

33.6
 %
Total assets
$
96,544

 
$
98,038

 
$
104,826

 
$
105,943

 
$
106,388

 
$
(9,844
)
(9.3
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities and Equity
 
 
 
 
 
 
 
 
 
 
 
 
Deposits:
 
 
 
 
 
 
 
 
 
 
 
 
Interest-bearing deposit accounts
$
63,857

 
$
64,302

 
$
64,877

 
$
65,677

 
$
65,382

 
$
(1,525
)
(2.3
)%
Non-interest-bearing deposit accounts
291

 
313

 
277

 
295

 
263

 
28

10.6
 %
Total deposits
64,148

 
64,615

 
65,154

 
65,972

 
65,645

 
(1,497
)
(2.3
)%
Borrowings:
 
 
 
 
 
 
 
 
 
 
 
 
Borrowings of consolidated securitization entities
8,109

 
9,291

 
10,412

 
10,912

 
11,941

 
(3,832
)
(32.1
)%
Senior unsecured notes
7,960

 
7,957

 
9,454

 
9,451

 
9,303

 
(1,343
)
(14.4
)%
Total borrowings
16,069

 
17,248

 
19,866

 
20,363

 
21,244

 
(5,175
)
(24.4
)%
Accrued expenses and other liabilities
4,428

 
4,205

 
4,718

 
4,488

 
4,765

 
(337
)
(7.1
)%
Total liabilities
84,645

 
86,068

 
89,738

 
90,823

 
91,654

 
(7,009
)
(7.6
)%
Equity:
 
 
 
 
 
 
 
 
 
 
 
 
Preferred stock
734

 
734

 
734

 

 

 
734

NM

Common stock
1

 
1

 
1

 
1

 
1

 

 %
Additional paid-in capital
9,532

 
9,523

 
9,537

 
9,520

 
9,500

 
32

0.3
 %
Retained earnings
9,852

 
9,960

 
12,117

 
11,533

 
10,627

 
(775
)
(7.3
)%
Accumulated other comprehensive income:
(37
)
 
(49
)
 
(58
)
 
(44
)
 
(43
)
 
6

(14.0
)%
Treasury stock
(8,183
)
 
(8,199
)
 
(7,243
)
 
(5,890
)
 
(5,351
)
 
(2,832
)
52.9
 %
Total equity
11,899

 
11,970

 
15,088

 
15,120

 
14,734

 
(2,835
)
(19.2
)%
Total liabilities and equity
$
96,544

 
$
98,038

 
$
104,826

 
$
105,943

 
$
106,388

 
$
(9,844
)
(9.3
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) Effective January 1, 2020, the Company adopted ASU 2016-13, Financial Instruments-Credit Losses ("CECL") that measures the allowance for credit losses based on management’s best estimate of expected credit losses for the life of our loan receivables. Prior periods presented reflect measurement of the allowance based on management’s estimate of probable incurred credit losses in accordance with the previous accounting guidance effective for those periods.

4



SYNCHRONY FINANCIAL
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
AVERAGE BALANCES, NET INTEREST INCOME AND NET INTEREST MARGIN
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(unaudited, $ in millions)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
Jun 30, 2020
 
Mar 31, 2020
 
Dec 31, 2019
 
Sep 30, 2019
 
Jun 30, 2019
 
 
 
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
$
15,413

 
$
3

 
0.08
%
 
$
12,902

 
$
42

 
1.31
%
 
$
16,269

 
$
68

 
1.66
%
 
$
10,947

 
$
59

 
2.14
%
 
$
10,989

 
$
66

 
2.41
%
Securities available for sale
6,804

 
19

 
1.12
%
 
5,954

 
25

 
1.69
%
 
4,828

 
25

 
2.05
%
 
5,389

 
32

 
2.36
%
 
6,010

 
36

 
2.40
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loan receivables, including held for sale:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Credit cards
75,942

 
3,740

 
19.81
%
 
81,716

 
4,272

 
21.03
%
 
81,960

 
4,409

 
21.34
%
 
87,156

 
4,807

 
21.88
%
 
85,488

 
4,557

 
21.38
%
Consumer installment loans
1,546

 
37

 
9.63
%
 
1,432

 
35

 
9.83
%
 
2,058

 
48

 
9.25
%
 
2,022

 
48

 
9.42
%
 
1,924

 
44

 
9.17
%
Commercial credit products
1,150

 
30

 
10.49
%
 
1,243

 
33

 
10.68
%
 
1,311

 
34

 
10.29
%
 
1,329

 
35

 
10.45
%
 
1,330

 
34

 
10.25
%
Other
59

 
1

 
NM

 
37

 

 
%
 
47

 
1

 
NM

 
49

 

 
%
 
50

 
1

 
NM

Total loan receivables, including held for sale
78,697

 
3,808

 
19.46
%
 
84,428

 
4,340

 
20.67
%
 
85,376

 
4,492

 
20.87
%
 
90,556

 
4,890

 
21.42
%
 
88,792

 
4,636

 
20.94
%
Total interest-earning assets
100,914

 
3,830

 
15.26
%
 
103,284

 
4,407

 
17.16
%
 
106,473

 
4,585

 
17.08
%
 
106,892

 
4,981

 
18.49
%
 
105,791

 
4,738

 
17.96
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Non-interest-earning assets:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and due from banks
1,486

 
 
 
 
 
1,450

 
 
 
 
 
1,326

 
 
 
 
 
1,374

 
 
 
 
 
1,271

 
 
 
 
Allowance for credit losses
(9,221
)
 
 
 
 
 
(8,708
)
 
 
 
 
 
(5,593
)
 
 
 
 
 
(5,773
)
 
 
 
 
 
(5,911
)
 
 
 
 
Other assets
4,779

 
 
 
 
 
4,696

 
 
 
 
 
3,872

 
 
 
 
 
3,920

 
 
 
 
 
3,752

 
 
 
 
Total non-interest-earning assets
(2,956
)
 
 
 
 
 
(2,562
)
 
 
 
 
 
(395
)
 
 
 
 
 
(479
)
 
 
 
 
 
(888
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total assets
$
97,958

 
 
 
 
 
$
100,722

 
 
 
 
 
$
106,078

 
 
 
 
 
$
106,413

 
 
 
 
 
$
104,903

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest-bearing liabilities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest-bearing deposit accounts
$
64,298

 
$
293

 
1.83
%
 
$
64,366

 
$
356

 
2.22
%
 
$
65,380

 
$
383

 
2.32
%
 
$
65,615

 
$
411

 
2.49
%
 
$
64,226

 
$
397

 
2.48
%
Borrowings of consolidated securitization entities
8,863

 
59

 
2.68
%
 
9,986

 
73

 
2.94
%
 
10,831

 
80

 
2.93
%
 
11,770

 
88

 
2.97
%
 
11,785

 
90

 
3.06
%
Senior unsecured notes
7,958

 
82

 
4.14
%
 
8,807

 
88

 
4.02
%
 
9,452

 
93

 
3.90
%
 
9,347

 
93

 
3.95
%
 
9,543

 
96

 
4.03
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total interest-bearing liabilities
81,119

 
434

 
2.15
%
 
83,159

 
517

 
2.50
%
 
85,663

 
556

 
2.58
%
 
86,732

 
592

 
2.71
%
 
85,554

 
583

 
2.73
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Non-interest-bearing liabilities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Non-interest-bearing deposit accounts
309

 
 
 
 
 
299

 
 
 
 
 
281

 
 
 
 
 
283

 
 
 
 
 
271

 
 
 
 
Other liabilities
4,349

 
 
 
 
 
4,672

 
 
 
 
 
4,906

 
 
 
 
 
4,570

 
 
 
 
 
4,260

 
 
 
 
Total non-interest-bearing liabilities
4,658

 
 
 
 
 
4,971

 
 
 
 
 
5,187

 
 
 
 
 
4,853

 
 
 
 
 
4,531

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total liabilities
85,777

 
 
 
 
 
88,130

 
 
 
 
 
90,850

 
 
 
 
 
91,585

 
 
 
 
 
90,085

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equity
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total equity
12,181

 
 
 
 
 
12,592

 
 
 
 
 
15,228

 
 
 
 
 
14,828

 
 
 
 
 
14,818

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total liabilities and equity
$
97,958

 
 
 
 
 
$
100,722

 
 
 
 
 
$
106,078

 
 
 
 
 
$
106,413

 
 
 
 
 
$
104,903

 
 
 
 
Net interest income
 
 
$
3,396

 
 
 
 
 
$
3,890

 
 
 
 
 
$
4,029

 
 
 
 
 
$
4,389

 
 
 
 
 
$
4,155

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate spread(1)
 
 
 
 
13.11
%
 
 
 
 
 
14.66
%
 
 
 
 
 
14.50
%
 
 
 
 
 
15.78
%
 
 
 
 
 
15.23
%
Net interest margin(2)
 
 
 
 
13.53
%
 
 
 
 
 
15.15
%
 
 
 
 
 
15.01
%
 
 
 
 
 
16.29
%
 
 
 
 
 
15.75
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(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.

5



 
 
 
 
 
 
 
 
 
 
 
 
SYNCHRONY FINANCIAL
 
 
 
 
 
 
 
 
 
AVERAGE BALANCES, NET INTEREST INCOME AND NET INTEREST MARGIN
 
 
 
 
 
 
(unaudited, $ in millions)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Six Months Ended
Jun 30, 2020
 
Six Months Ended
Jun 30, 2019
 
 
 
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
$
14,158

 
$
45

 
0.64
%
 
$
11,011

 
$
131

 
2.40
%
Securities available for sale
6,379

 
44

 
1.39
%
 
5,826

 
70

 
2.42
%
 
 
 
 
 
 
 
 
 
 
 
 
Loan receivables:
 
 
 
 
 
 
 
 
 
 
 
Credit cards, including held for sale
78,830

 
8,012

 
20.44
%
 
86,125

 
9,168

 
21.47
%
Consumer installment loans
1,489

 
72

 
9.72
%
 
1,884

 
86

 
9.21
%
Commercial credit products
1,196

 
63

 
10.59
%
 
1,291

 
68

 
10.62
%
Other
48

 
1

 
4.19
%
 
44

 
1

 
4.58
%
Total loan receivables, including held for sale
81,563

 
8,148

 
20.09
%
 
89,344

 
9,323

 
21.04
%
Total interest-earning assets
102,100

 
8,237

 
16.22
%
 
106,181

 
9,524

 
18.09
%
 
 
 
 
 
 
 
 
 
 
 
 
Non-interest-earning assets:
 
 
 
 
 
 
 
 
 
 
 
Cash and due from banks
1,468

 
 
 
 
 
1,303

 
 
 
 
Allowance for loan losses
(8,965
)
 
 
 
 
 
(6,125
)
 
 
 
 
Other assets
4,737

 
 
 
 
 
3,741

 
 
 
 
Total non-interest-earning assets
(2,760
)
 
 
 
 
 
(1,081
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total assets
$
99,340

 
 
 
 
 
$
105,100

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 
 
 
 
 
 
Interest-bearing liabilities:
 
 
 
 
 
 
 
 
 
 
 
Interest-bearing deposit accounts
$
64,332

 
$
649

 
2.03
%
 
$
64,002

 
$
772

 
2.43
%
Borrowings of consolidated securitization entities
9,425

 
132

 
2.82
%
 
12,592

 
190

 
3.04
%
Senior unsecured notes
8,382

 
170

 
4.08
%
 
9,219

 
181

 
3.96
%
Total interest-bearing liabilities
82,139

 
951

 
2.33
%
 
85,813

 
1,143

 
2.69
%
 
 
 
 
 
 
 
 
 
 
 
 
Non-interest-bearing liabilities
 
 
 
 
 
 
 
 
 
 
 
Non-interest-bearing deposit accounts
304

 
 
 
 
 
278

 
 
 
 
Other liabilities
4,511

 
 
 
 
 
4,205

 
 
 
 
Total non-interest-bearing liabilities
4,815

 
 
 
 
 
4,483

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total liabilities
86,954

 
 
 
 
 
90,296

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equity
 
 
 
 
 
 
 
 
 
 
 
Total equity
12,386

 
 
 
 
 
14,804

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total liabilities and equity
$
99,340

 
 
 
 
 
$
105,100

 
 
 
 
Net interest income
 
 
$
7,286

 
 
 
 
 
$
8,381

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate spread(1)
 
 
 
 
13.89
%
 
 
 
 
 
15.40
%
Net interest margin(2)
 
 
 
 
14.35
%
 
 
 
 
 
15.92
%
 
 
 
 
 
 
 
 
 
 
 
 
(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.



6



SYNCHRONY FINANCIAL
 
 
 
 
 
 
 
 
 
 
BALANCE SHEET STATISTICS
 
 
 
 
 
 
 
 
 
 
 
 
(unaudited, $ in millions, except per share statistics)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
 
 
 
Jun 30,
2020
 
Mar 31,
2020
 
Dec 31,
2019
 
Sep 30,
2019
 
Jun 30,
2019
 
Jun 30, 2020 vs.
Jun 30, 2019
BALANCE SHEET STATISTICS
 
 
 
 
 
 
 
 
 
 
 
 
Total common equity
$
11,165

 
$
11,236

 
$
14,354

 
$
15,120

 
$
14,734

 
$
(3,569
)
(24.2
)%
Total common equity as a % of total assets
11.56
%
 
11.46
%
 
13.69
%
 
14.27
%
 
13.85
%
 

(2.29
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
Tangible assets
$
94,300

 
$
95,752

 
$
102,483

 
$
103,688

 
$
104,095

 
$
(9,795
)
(9.4
)%
Tangible common equity(1)
$
8,921

 
$
8,950

 
$
12,011

 
$
12,865

 
$
12,441

 
$
(3,520
)
(28.3
)%
Tangible common equity as a % of tangible assets(1)
9.46
%
 
9.35
%
 
11.72
%
 
12.41
%
 
11.95
%
 

(2.49
)%
Tangible common equity per share(1)
$
15.28

 
$
15.35

 
$
19.50

 
$
19.68

 
$
18.60

 
$
(3.32
)
(17.8
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
REGULATORY CAPITAL RATIOS(2)(3)
 
 
 
 
 
 
 
 
 
 
 
 

Basel III - CECL Transition
 
Basel III
 
 
 
Total risk-based capital ratio(4)
17.6
%
 
16.5
%
 
16.3
%
 
15.8
%
 
15.6
%
 
 
 
Tier 1 risk-based capital ratio(5)
16.3
%
 
15.2
%
 
15.0
%
 
14.5
%
 
14.3
%
 
 
 
Tier 1 leverage ratio(6)
12.7
%
 
12.3
%
 
12.6
%
 
12.6
%
 
12.4
%
 
 
 
Common equity Tier 1 capital ratio
15.3
%
 
14.3
%
 
14.1
%
 
14.5
%
 
14.3
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

(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 ratios at June 30, 2020 are preliminary and therefore subject to change.
(3) Capital ratios starting March 31, 2020 reflect election to delay for two years an estimate of CECL’s effect on regulatory capital in accordance with the interim final rule issued by U.S. banking agencies in March 2020.
(4) Total risk-based capital ratio is the ratio of total risk-based capital divided by risk-weighted assets.
(5) Tier 1 risk-based capital ratio is the ratio of Tier 1 capital divided by risk-weighted assets.
(6) 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.


 
 
 
 
 
 
 
 
 
 
 
 
 

7



SYNCHRONY FINANCIAL
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
PLATFORM RESULTS
 
 
 
 
 
 
 
 
 
 
 
 
(unaudited, $ in millions)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
 
 
 
Six Months Ended
 
 
 
 
Jun 30,
2020
 
Mar 31,
2020
 
Dec 31,
2019
 
Sep 30,
2019
 
Jun 30,
2019
 
2Q'20 vs. 2Q'19
 
Jun 30,
2020
 
Jun 30,
2019
 
YTD'20 vs. YTD'19
RETAIL CARD
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Purchase volume(1)(2)
$
24,380

 
$
24,008

 
$
30,968

 
$
29,282

 
$
29,530

 
$
(5,150
)
(17.4
)%
 
$
48,388

 
$
54,190

 
$
(5,802
)
(10.7
)%
Period-end loan receivables
$
49,967

 
$
52,390

 
$
56,387

 
$
52,697

 
$
52,307

 
$
(2,340
)
(4.5
)%
 
$
49,967

 
$
52,307

 
$
(2,340
)
(4.5
)%
Average loan receivables, including held for sale
$
50,238

 
$
53,820

 
$
54,505

 
$
60,660

 
$
59,861

 
$
(9,623
)
(16.1
)%
 
$
52,029

 
$
60,409

 
$
(8,380
)
(13.9
)%
Average active accounts (in thousands)(2)(3)
46,970

 
53,018

 
54,662

 
58,082

 
57,212

 
(10,242
)
(17.9
)%
 
49,982

 
58,132

 
(8,150
)
(14.0
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest and fees on loans
$
2,640

 
$
3,037

 
$
3,143

 
$
3,570

 
$
3,390

 
$
(750
)
(22.1
)%
 
$
5,677

 
$
6,844

 
$
(1,167
)
(17.1
)%
Other income
$
56

 
$
59

 
$
77

 
$
65

 
$
59

 
$
(3
)
(5.1
)%
 
$
115

 
$
135

 
$
(20
)
(14.8
)%
Retailer share arrangements
$
(752
)
 
$
(904
)
 
$
(988
)
 
$
(998
)
 
$
(836
)
 
$
84

(10.0
)%
 
$
(1,656
)
 
$
(1,776
)
 
$
120

(6.8
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
PAYMENT SOLUTIONS
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Purchase volume(1)(2)
$
4,823

 
$
5,375

 
$
6,402

 
$
6,281

 
$
5,948

 
$
(1,125
)
(18.9
)%
 
$
10,198

 
$
11,197

 
$
(999
)
(8.9
)%
Period-end loan receivables
$
19,119

 
$
19,973

 
$
20,528

 
$
20,478

 
$
19,766

 
$
(647
)
(3.3
)%
 
$
19,119

 
$
19,766

 
$
(647
)
(3.3
)%
Average loan receivables, including held for sale
$
19,065

 
$
20,344

 
$
20,701

 
$
20,051

 
$
19,409

 
$
(344
)
(1.8
)%
 
$
19,705

 
$
19,453

 
$
252

1.3
 %
Average active accounts (in thousands)(2)(3)
11,900

 
12,681

 
12,713

 
12,384

 
12,227

 
(327
)
(2.7
)%
 
12,266

 
12,321

 
(55
)
(0.4
)%
 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest and fees on loans
$
632

 
$
706

 
$
737

 
$
721

 
$
685

 
$
(53
)
(7.7
)%
 
$
1,338

 
$
1,371

 
$
(33
)
(2.4
)%
Other income
$
14

 
$
13

 
$
4

 
$
(1
)
 
$
11

 
$
3

27.3
 %
 
$
27

 
$
12

 
$
15

125.0
 %
Retailer share arrangements
$
(18
)
 
$
(18
)
 
$
(37
)
 
$
(15
)
 
$
(21
)
 
$
3

(14.3
)%
 
$
(36
)
 
$
(33
)
 
$
(3
)
9.1
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
CARECREDIT
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Purchase volume(1)
$
1,952

 
$
2,659

 
$
2,842

 
$
2,832

 
$
2,813

 
$
(861
)
(30.6
)%
 
$
4,611

 
$
5,417

 
$
(806
)
(14.9
)%
Period-end loan receivables
$
9,227

 
$
10,106

 
$
10,300

 
$
10,032

 
$
9,723

 
$
(496
)
(5.1
)%
 
$
9,227

 
$
9,723

 
$
(496
)
(5.1
)%
Average loan receivables, including held for sale
$
9,394

 
$
10,264

 
$
10,170

 
$
9,845

 
$
9,522

 
$
(128
)
(1.3
)%
 
$
9,829

 
$
9,482

 
$
347

3.7
 %
Average active accounts (in thousands)(3)
5,966

 
6,379

 
6,359

 
6,229

 
6,086

 
(120
)
(2.0
)%
 
6,153

 
6,092

 
61

1.0
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest and fees on loans
$
536

 
$
597

 
$
612

 
$
599

 
$
561

 
$
(25
)
(4.5
)%
 
$
1,133

 
$
1,108

 
$
25

2.3
 %
Other income
$
25

 
$
25

 
$
23

 
$
21

 
$
20

 
$
5

25.0
 %
 
$
50

 
$
35

 
$
15

42.9
 %
Retailer share arrangements
$
(3
)
 
$
(4
)
 
$
(4
)
 
$
(3
)
 
$
(2
)
 
$
(1
)
50.0
 %
 
$
(7
)
 
$
(4
)
 
$
(3
)
75.0
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
TOTAL SYF
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Purchase volume(1)(2)
$
31,155

 
$
32,042

 
$
40,212

 
$
38,395

 
$
38,291

 
$
(7,136
)
(18.6
)%
 
$
63,197

 
$
70,804

 
$
(7,607
)
(10.7
)%
Period-end loan receivables
$
78,313

 
$
82,469

 
$
87,215

 
$
83,207

 
$
81,796

 
$
(3,483
)
(4.3
)%
 
$
78,313

 
$
81,796

 
$
(3,483
)
(4.3
)%
Average loan receivables, including held for sale
$
78,697

 
$
84,428

 
$
85,376

 
$
90,556

 
$
88,792

 
$
(10,095
)
(11.4
)%
 
$
81,563

 
$
89,344

 
$
(7,781
)
(8.7
)%
Average active accounts (in thousands)(2)(3)
64,836

 
72,078

 
73,734

 
76,695

 
75,525

 
(10,689
)
(14.2
)%
 
68,401

 
76,545

 
(8,144
)
(10.6
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest and fees on loans
$
3,808

 
$
4,340

 
$
4,492

 
$
4,890

 
$
4,636

 
$
(828
)
(17.9
)%
 
$
8,148

 
$
9,323

 
$
(1,175
)
(12.6
)%
Other income
$
95

 
$
97

 
$
104

 
$
85

 
$
90

 
$
5

5.6
 %
 
$
192

 
$
182

 
$
10

5.5
 %
Retailer share arrangements
$
(773
)
 
$
(926
)
 
$
(1,029
)
 
$
(1,016
)
 
$
(859
)
 
$
86

(10.0
)%
 
$
(1,699
)
 
$
(1,813
)
 
$
114

(6.3
)%
(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.
 
 
 
 
 
 
 

 
 
 
 
 
 
 

 
 
 
 
 
 
 

8



SYNCHRONY FINANCIAL
 
 
 
 
 
 
 
 
 
RECONCILIATION OF NON-GAAP MEASURES AND CALCULATIONS OF REGULATORY MEASURES(1)
 
 
(unaudited, $ in millions, except per share statistics)
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
Jun 30,
2020
 
Mar 31,
2020
 
Dec 31,
2019
 
Sep 30,
2019
 
Jun 30,
2019
COMMON EQUITY AND REGULATORY CAPITAL MEASURES(2)
 
 
 
 
 
 
 
 
 
GAAP Total equity
$
11,899

 
$
11,970

 
$
15,088

 
$
15,120

 
$
14,734

Less: Preferred stock
(734
)
 
(734
)
 
(734
)
 

 

Less: Goodwill
(1,078
)
 
(1,078
)
 
(1,078
)
 
(1,078
)
 
(1,078
)
Less: Intangible assets, net
(1,166
)
 
(1,208
)
 
(1,265
)
 
(1,177
)
 
(1,215
)
Tangible common equity
$
8,921

 
$
8,950

 
$
12,011

 
$
12,865

 
$
12,441

Add: CECL transition amount
2,570

 
2,417

 

 

 

 
 
 
 
 
 
 
 
 
 
Adjustments for certain deferred tax liabilities and certain items in accumulated comprehensive income (loss)
302

 
304

 
319

 
290

 
283

Common equity Tier 1
$
11,793

 
$
11,671

 
$
12,330

 
$
13,155

 
$
12,724

Preferred stock
734

 
734

 
734

 

 

Tier 1 capital
$
12,527

 
$
12,405

 
$
13,064

 
$
13,155

 
$
12,724

 
 
 
 
 
 
 
 
 
 
Add: Allowance for credit losses includible in risk-based capital
1,031

 
1,082

 
1,147

 
1,190

 
1,169

Total Risk-based capital
$
13,558

 
$
13,487

 
$
14,211

 
$
14,345

 
$
13,893

 
 
 
 
 
 
 
 
 
 
ASSET MEASURES(2)
 
 
 
 
 
 
 
 
 
Total average assets
$
97,958

 
$
100,722

 
$
106,078

 
$
106,413

 
$
104,903

Adjustments for:
 
 
 
 
 
 
 
 
 
Add: CECL transition amount
2,570

 
2,417

 

 

 

Disallowed goodwill and other disallowed intangible assets
(net of related deferred tax liabilities) and other
(1,980
)
 
(2,010
)
 
(2,059
)
 
(1,975
)
 
(2,003
)
Total assets for leverage purposes
$
98,548

 
$
101,129

 
$
104,019

 
$
104,438

 
$
102,900

 
 
 
 
 
 
 
 
 
 
Risk-weighted assets
$
77,048

 
$
81,639

 
$
87,302

 
$
90,772

 
$
88,890

 
 
 
 
 
 
 
 
 
 
CECL FULLY PHASED-IN CAPITAL MEASURES
 
 
 
 
 
 
 
 
 
Tier 1 capital
$
12,527

 
$
12,405

 
$
13,064

 
$
13,155

 
$
12,724

Less: CECL transition adjustment
(2,570
)
 
(2,417
)
 

 

 

Tier 1 capital (CECL fully phased-in)
$
9,957

 
$
9,988

 
$
13,064

 
$
13,155

 
$
12,724

Add: Allowance for credit losses
9,802

 
9,175

 
5,602

 
5,607

 
5,809

Tier 1 capital (CECL fully phased-in) + Reserves for credit losses
$
19,759

 
$
19,163

 
$
18,666

 
$
18,762

 
$
18,533

 
 
 
 
 
 
 
 
 
 
Risk-weighted assets
$
77,048

 
$
81,639

 
$
87,302

 
$
90,772

 
$
88,890

Less: CECL transition adjustment
(2,361
)
 
(2,204
)
 

 

 

Risk-weighted assets (CECL fully phased-in)
$
74,687

 
$
79,435

 
$
87,302

 
$
90,772

 
$
88,890

 
 
 
 
 
 
 
 
 
 
TANGIBLE COMMON EQUITY PER SHARE
 
 
 
 
 
 
 
 
 
GAAP book value per share
$
19.13

 
$
19.27

 
$
23.31

 
$
23.13

 
$
22.03

Less: Goodwill
(1.85
)
 
(1.85
)
 
(1.75
)
 
(1.65
)
 
(1.61
)
Less: Intangible assets, net
(2.00
)
 
(2.07
)
 
(2.06
)
 
(1.80
)
 
(1.82
)
Tangible common equity per share
$
15.28

 
$
15.35

 
$
19.50

 
$
19.68

 
$
18.60

 
 
 
 
 
 
 
 
 
 
(1) Regulatory measures at June 30, 2020 are presented on an estimated basis.
(2) Capital ratios starting March 31, 2020 reflect election to delay for two years an estimate of CECL’s effect on regulatory capital in accordance with the interim final rule issued by U.S. banking agencies in March 2020.


9



SYNCHRONY FINANCIAL
 
 
 
 
 
 
 
 
 
RECONCILIATION OF NON-GAAP MEASURES (Continued)
 
 
(unaudited, $ in millions, except per share statistics)
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
Jun 30,
2020
 
Mar 31,
2020
 
Dec 31,
2019
 
Sep 30,
2019
 
Jun 30,
2019
ALLOWANCE FOR LOAN LOSSES (1)
 
 
 
 
 
 
 
 
 
Allowance for credit losses
$
9,802

 
$
9,175

 
N/A

 
N/A

 
N/A

Less: Impact from CECL(2)
(3,605
)
 
(3,122
)
 

 

 

Allowance for loan losses(1)
$
6,197

 
$
6,053

 
$
5,602

 
$
5,607

 
$
5,809

 
 
 
 
 
 
 
 
 
 
ALLOWANCE FOR LOAN LOSSES AS A % OF PERIOD-END LOAN RECEIVABLES
 
 
 
 
 
 
 
 
 
Allowance for credit losses as a % of period-end loan receivables
12.52
 %
 
11.13
 %
 
N/A

 
N/A

 
N/A

Less: Impact from CECL(2)
(4.61
)%
 
(3.79
)%
 
%
 
%
 
%
Allowance for loan losses as a % of period-end loan receivables
7.91
 %
 
7.34
 %
 
6.42
%
 
6.74
%
 
7.10
%
 
 
 
 
 
 
 
 
 
 
CORE PURCHASE VOLUME
 
 
 
 
 
 
 
 
 
Purchase Volume
$
31,155

 
$
32,042

 
$
40,212

 
$
38,395

 
$
38,291

Less: Walmart and Yamaha Purchase volume

 

 
(267
)
 
(2,381
)
 
(2,512
)
Core Purchase volume
$
31,155

 
$
32,042

 
$
39,945

 
$
36,014

 
$
35,779

 
 
 
 
 
 
 
 
 
 
CORE LOAN RECEIVABLES
 
 
 
 
 
 
 
 
 
Loan receivables
$
78,313

 
$
82,469

 
$
87,215

 
$
83,207

 
$
81,796

Less: Walmart and Yamaha Loan receivables

 

 
(3
)
 
(872
)
 
(1,188
)
Core Loan receivables
$
78,313

 
$
82,469

 
$
87,212

 
$
82,335

 
$
80,608

 
 
 
 
 
 
 
 
 
 
Retail Card Loan receivables
$
49,967

 
$
52,390

 
$
56,387

 
$
52,697

 
$
52,307

Less: Walmart Loan receivables

 

 

 
(112
)
 
(431
)
Core Loan receivables
$
49,967

 
$
52,390

 
$
56,387

 
$
52,585

 
$
51,876

 
 
 
 
 
 
 
 
 
 
Payment Solutions Loan receivables
$
19,119

 
$
19,973

 
$
20,528

 
$
20,478

 
$
19,766

Less: Yamaha Loan receivables

 

 
(3
)
 
(760
)
 
(757
)
Core Loan receivables
$
19,119

 
$
19,973

 
$
20,525

 
$
19,718

 
$
19,009

 
 
 
 
 
 
 
 
 
 
CORE AVERAGE ACTIVE ACCOUNTS (in thousands)
 
 
 
 
 
 
 
 
 
Average active accounts (in thousands)
64,836

 
72,078

 
73,734

 
76,695

 
75,525

Less: Walmart and Yamaha average Active accounts (in thousands)

 

 
(1,777
)
 
(7,001
)
 
(7,215
)
Core Average active accounts (in thousands)
64,836

 
72,078

 
71,957

 
69,694

 
68,310

 
 
 
 
 
 
 
 
 
 
CORE INTEREST AND FEES ON LOANS
 
 
 
 
 
 
 
 
 
Interest and fees on loans
$
3,808

 
$
4,340

 
$
4,492

 
$
4,890

 
$
4,636

Less: Walmart and Yamaha Interest and fees on loans

 

 
(69
)
 
(531
)
 
(520
)
Core Interest and fees on loans
$
3,808

 
$
4,340

 
$
4,423

 
$
4,359

 
$
4,116

 
 
 
 
 
 
 
 
 
 
(1) Beginning in 1Q'20, allowance for loan losses is calculated based upon accounting standards no longer effective, and as such is a Non-GAAP measure.
(2) Impact from CECL reflects the additional allowance for credit losses recorded in accordance with ASC 2016-13, as compared to the allowance for credit losses required had the prior accounting guidance been applied.


10