Synchrony Financial
For the period ended Mar 31, 2025. Filed Apr 24, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2025 · Filed Apr 24, 2025
SYF$73.74-0.4%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-30; filed 2024-10-23.
0001601712-24-000336
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCondensed Consolidated Statements of Earnings –Three and nine months ended September 30, 2024 and 2023Condensed Consolidated Statements of Comprehensive Income –Three and nine months ended September 30, 2024 and 2023Condensed Consolidated Statements of Financial Position –September 30, 2024 and December 31, 2023Condensed Consolidated Statements of Changes in Equity –Three and nine months ended September 30, 2024 and 2023Condensed Consolidated Statements of Cash Flows –Nine months ended September 30, 2024 and 2023Notes to Condensed Consolidated Financial StatementsCurrent report: 10-Q
Period ended 2025-03-31; filed 2025-04-24.
0001601712-25-000144
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsIndex to Condensed Consolidated Financial StatementsCondensed Consolidated Statements of Earnings –Three months ended March 31, 2025 and 2024Condensed Consolidated Statements of Comprehensive Income –Three months ended March 31, 2025 and 2024Condensed Consolidated Statements of Financial Position –March 31, 2025 and December 31, 2024Condensed Consolidated Statements of Changes in Equity –Three months ended March 31, 2025 and 2024Condensed Consolidated Statements of Cash Flows –Three months ended March 31, 2025 and 2024Notes to Condensed Consolidated Financial StatementsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 406 previous paragraphs and 399 current paragraphs.
222 unchanged; 113 reworded; 61 added; 65 removed; 6 previous and 3 current paragraphs rearranged.
Tables are not compared: 83 previous and 70 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (61)
Current report
On April 14, 2025, in the litigation challenging the final late fee rule, the CFPB and the plaintiff industry organizations filed a joint motion asking the court to vacate the final rule and dismiss the case. On April 15, 2025, the court granted this motion. As such, the final rule has been vacated.
Current report
In anticipation that the final rule would become effective, we implemented a number of product, pricing and policy changes in the prior year. In light of the final rule being vacated, we plan to review the product, pricing and policy changes with our partners, consistent with our usual business practice of monitoring overall program performance, including assessing whether any adjustments are warranted.
Current report
The seasonal trends discussed above are most evident between the fourth quarter and the first quarter of the following year, particularly with respect to our loan receivables which decreased by $5.1 billion, or 4.9% to $99.6 billion at March 31, 2025 compared to $104.7 billion at December 31, 2024, and our allowance for credit losses as a percentage of total loan receivables that increased to 10.87% at March 31, 2025, from 10.44% at December 31, 2024.
Current report
•Loan receivables decreased 2.1% to $99.6 billion at March 31, 2025 compared to $101.7 billion at March 31, 2024, primarily reflecting the impact of lower purchase volume.
Current report
•Net interest income increased 1.3% to $4.5 billion for the three months ended March 31, 2025 primarily driven by a reduction in interest expense. For the three months ended March 31, 2025, interest expense decreased 6.6% primarily due to lower benchmark rates. Interest and fees on loans was flat for the three months ended March 31, 2025, primarily driven by the impact of our product, pricing and policy changes, offset by lower benchmark rates and lower late fee incidence.
Current report
•Retailer share arrangements increased 17.1% to $895 million for the three months ended March 31, 2025, primarily reflecting program performance which includes the impact of our product, pricing and policy changes.
Current report
•Other income decreased by $1.0 billion to $149 million, for the three months ended March 31, 2025 primarily driven by the $1.1 billion gain on sale related to Pets Best in the prior year, partially offset by the impact of our product, pricing and policy change related fees in the current year period.
Current report
•In our Home & Auto sales platform, we extended our program agreements with Ashley HomeStores, Inc. and Discount Tire.
Current report
•In our Lifestyle sales platform, we extended our program agreement with American Eagle.
Current report
Interest income was flat for the three months ended March 31, 2025, reflecting the trend in interest and fees on loans, as the impacts of our product, pricing and policy changes were offset by a combination of lower benchmark rates and lower late fee incidence, as well as lower interest income from our liquidity portfolio.
Current report
Interest expense decreased by $77 million to $1.1 billion, for the three months ended March 31, 2025, primarily due to lower benchmark rates. Our cost of funds decreased to 4.48% for the three months ended March 31, 2025, compared to 4.74% for the three months ended March 31, 2024.
Current report
Retailer share arrangements increased by $131 million, or 17.1%, for the three months ended March 31, 2025, reflecting program performance which includes the impact of our product, pricing and policy changes.
Current report
Provision for credit losses decreased by $393 million, or 20.9%, for the three months ended March 31, 2025, primarily driven by a reserve release of $97 million versus a reserve build of $299 million in the prior year which included a $190 million reserve build related to the Ally Lending acquisition. The net charge-off rate for the three months ended March 31, 2025 increased by 7 basis points to 6.38%, as compared to the prior year period.
Current report
Other expense increased by $37 million, or 3.1%, for the three months ended March 31, 2025.
Current report
The increase in the three months ended March 31, 2025 was primarily driven by costs related to technology investments in information processing, and also included the impacts of a charitable contribution in other and a restructuring charge related to our Ally Lending business in employee costs.
Current report
Home & Auto interest and fees on loans increased by $31 million, or 2.2%, for the three months ended March 31, 2025, primarily driven by higher loan receivables yield and the impacts of the Ally Lending acquisition in March 2024, partially offset by lower average loan receivables. The increase in loan receivables yield reflects the impact of product, pricing and policy changes, partially offset by lower late fee incidence. Purchase volume decreased 9.0% for the three months ended March 31, 2025, driven by a combination of lower consumer traffic and the impact of credit actions.
Current report
Digital interest and fees on loans decreased by $23 million, or 1.5%, for the three months ended March 31, 2025, respectively, primarily driven by lower loan receivables yield, reflecting lower benchmark rates and lower late fee incidence, partially offset by the impact of product, pricing and policy changes. Purchase volume decreased by 1.2% for the three months ended March 31, 2025, as growth in consumer spend per account was more than offset by fewer active accounts, reflecting a more selective acquisition strategy. Average active accounts decreased by 3.0% for the three months ended March 31, 2025.
Current report
Diversified & Value interest and fees on loans decreased by $36 million, or 3.0%, for the three months ended March 31, 2025, primarily driven by lower loan receivables yield, reflecting lower benchmark rates and lower late fee incidence, partially offset by the impact of product, pricing and policy changes. Purchase volume decreased by 2.1% for the three months ended March 31, 2025 as growth in consumer spend per account was more than offset by fewer active accounts, primarily reflecting lower consumer traffic and the impact of credit actions. Average active accounts decreased by 4.4% for the three months ended March 31, 2025.
Current report
Lifestyle interest and fees on loans increased by $6 million, or 2.4%, for the three months ended March 31, 2025, primarily driven by higher loan receivables yield, reflecting the impact of product, pricing and policy changes partially offset by lower benchmark rates, and growth in average loan receivables. Purchase volume decreased by 6.1% for the three months ended March 31, 2025, driven by lower spend in Outdoor and Specialty, as consumers continued to manage discretionary spend, and also includes the impact of credit actions.
Current report
Loan receivables decreased 4.9% to $99.6 billion at March 31, 2025 compared to $104.7 billion at December 31, 2024, primarily driven by the seasonality of our business and a reduction in purchase volume.
Current report
Loan receivables at March 31, 2025 decreased 2.1% compared to $101.7 billion at March 31, 2024 driven by lower purchase volume.
Current report
(4)Interest rate fixed through March 6, 2030; resets March 7, 2030 to floating rate based on compounded Secured Overnight Financing Rate ("SOFR") plus 168 basis points.
Current report
Change in methodology for Allowance for Credit Losses
Current report
At March 31, 2025, our Allowance for Credit Losses reflects changes we made during the three months ended March 31, 2025 to our methodology related to the modeling of loss projections attributable to existing loan balances and the reversion to historical mean. Our updated loss forecasting methodology utilizes a statistical, account-level model that analyzes probability of default and exposure at default for our loan receivables, as compared to our prior methodology which utilized an enhanced migration analysis to estimate credit losses. Our reversion methodology, which continues to be applied over a 6-month period, also changed from the prior weighted approach used since the adoption of CECL to apply a straight-line methodology. These changes in methodology were made prospectively to enhance our expected credit loss estimation capabilities and did not have a material effect on our Allowance for Credit Losses at March 31, 2025.
Current report
For periods presented prior to March 31, 2025, the Allowance for Credit Losses reflects the methodology utilized prior to these changes. See our 2024 Form 10-K for additional information on the prior methodology for our Allowance for Credit Losses, and see below for additional information on the updated methodology reflected in the Allowance for Credit Losses at March 31, 2025.
Current report
Losses on loan receivables are estimated and recognized upon origination of the loan, based on expected credit losses for the life of the loan balance as of the period end date. Expected credit loss estimates involve modeling loss projections attributable to existing loan balances, considering historical experience, current conditions and future expectations for pools of loans with similar risk characteristics over the reasonable and supportable forecast period and considers historical loss information beyond the reasonable and supportable period.
Current report
We use a probability of default and exposure at default model to estimate the expected loan loss, which considers uncollectible principal, interest and fees reflected in the loan receivables, segmented into pools of loans with similar risk characteristics, such as retailer, performance and credit attributes, as well as individual credit characteristics for each account. Our probability of default estimates the likelihood an account will be written off and the exposure at default estimates the balance of an account at the time of write-off. The model considers a macroeconomic forecast, with unemployment and certain income measures as primary variables. We also perform a qualitative assessment in addition to model estimates and apply qualitative adjustments as necessary.
Current report
We evaluate our Allowance for Credit Losses quarterly. Our estimation process includes analysis of historical data, and there is a significant amount of judgment applied in selecting inputs and analyzing the results produced by the model to determine the Allowance for Credit Losses. Other data utilized in our estimate of expected losses, includes past performance, changes in underwriting policies, bankruptcy activity such as filings, loan volumes and amounts. We also evaluate portfolio risk management techniques applied to various accounts, historical behavior of different account vintages, account seasoning, economic conditions, recent trends in delinquencies and net charge-offs, account collection management including the impact of modifications made to borrowers experiencing financial difficulty, forecasting uncertainties, expectations about the future, and a qualitative assessment of the adequacy of the allowance for credit losses. Additionally, the estimate of expected credit losses includes expected recoveries of amounts previously charged-off and expected to be charged-off.
Current report
Key factors that impact the accuracy of our historical loss forecast estimates include the models and methodology utilized, credit strategy and trends, and consideration of material changes in our loan portfolio such as changes in growth and portfolio mix.
Current report
Our credit card loan receivables generally do not have a stated life. The life of a credit card loan receivable is dependent upon the allocation of payments received, as well as a variety of other factors, including the principal balance, promotional terms, interest charges and fees and overall consumer credit profile and usage pattern. We determine the expected credit losses for credit card loan receivables as of the measurement date by using an estimated probability of default and exposure at default model, and other historical analyses, which considers the payments attributable to the measurement date balance. To do so, we utilize an approach which considers total expected future payments and applies appropriate allocations to reduce those payments in order to estimate losses pertaining to measurement date loan receivables. Based on our payments analyses, we also ensure that expected future payments from an account do not exceed the measurement date balance.
Current report
The reasonable and supportable forecast period is determined primarily based upon an assessment of the current economic outlook, including our ability to use available data to accurately forecast losses over time. The reasonable and supportable forecast period used in our estimate of credit losses at March 31, 2025 was 12 months, consistent with the forecast period utilized since adoption of CECL. The Company reassesses the reasonable and supportable forecast period on a quarterly basis. Beyond the reasonable and supportable forecast period, we revert to historical loss information at the loan receivables segment level over a 6-month period on a straight-line basis and utilize historical loss information thereafter for the remaining life of the portfolio. The historical loss information is derived from a combination of recessionary and non-recessionary performance periods, weighted by the estimated time span of each period. Similar to the reasonable and supportable forecast period, we also reassess the reversion period and historical mean on a quarterly basis, considering any required adjustments for differences in underwriting standards, portfolio mix, and other relevant data shifts over time. The reversion period, similar to the reasonable and supportable forecast period, may change in the future depending on multiple factors such as forecasting methods, portfolio changes, and macroeconomic environment.
Current report
Further, when experience is not available for new portfolios, while we accumulate experience, we may utilize our experience with the most closely analogous products and segments in our portfolio. The underlying assumptions, estimates and assessments we use to provide for losses are updated periodically to reflect our view of current and forecasted conditions and are subject to the regulatory examination process, which can result in changes to our assumptions. Changes in such estimates can significantly affect the allowance and provision for credit losses. It is possible that we will experience credit losses that are different from our current estimates.
Current report
On October 24, 2023, the Federal Reserve, FDIC, and OCC issued a final rule revising their framework for evaluating banks’ records of community reinvestment under the Community Reinvestment Act (“CRA”). On March 28, 2025, these bank regulatory agencies announced their intent to issue a proposal to rescind the October 2023 final rule and reinstate the CRA framework that existed prior to the October 2023 final rule. The Bank received a rating of “Outstanding” in its most recent performance evaluation, which was conducted using the CRA framework that existed prior to the October 2023 final rule.
Current report
In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40). This ASU requires disaggregated information about certain income statement line items in a tabular format in the notes to the financial statements. The Company will adopt this guidance on its effective date, which for us is beginning within our December 31, 2027 Form 10-K, and is currently determining the method of adoption, however, it is not expected to have a material impact to our Consolidated Financial Statements.
Current report
Changes in methodology for Allowance for Credit Losses
Current report
At March 31, 2025, our Allowance for Credit Losses reflects changes we made during the three months ended March 31, 2025 to our methodology related to the modeling of loss projections attributable to existing loan balances and the reversion to historical mean. Our updated loss forecasting methodology utilizes a statistical, account-level model that analyzes probability of default and exposure at default for our loan receivables, as compared to our prior methodology which utilized an enhanced migration analysis to estimate credit losses. Our reversion methodology, which continues to be applied over a 6-month period, also changed from the prior weighted approach used since the adoption of CECL to apply a straight-line methodology. These changes in methodology were made prospectively to enhance our expected credit loss estimation capabilities and did not have a material effect on our Allowance for Credit Losses at March 31, 2025.
Current report
For periods presented prior to March 31, 2025, the Allowance for Credit Losses reflects the methodology utilized prior to these changes. See 2024 Form 10-K for additional information on the prior methodology for our Allowance for Credit Losses, and see below for additional information on the updated methodology reflected in the Allowance for Credit Losses at March 31, 2025.
Current report
Losses on loan receivables are estimated and recognized upon origination of the loan, based on expected credit losses for the life of the loan balance as of the period end date. Expected credit loss estimates involve modeling loss projections attributable to existing loan balances, considering historical experience, current conditions and future expectations for pools of loans with similar risk characteristics over the reasonable and supportable forecast period and considers historical loss information beyond the reasonable and supportable period.
Current report
We use a probability of default and exposure at default model to estimate the expected loan loss, which considers uncollectible principal, interest and fees reflected in the loan receivables, segmented into pools of loans with similar risk characteristics, such as retailer, performance and credit attributes, as well as individual credit characteristics for each account. The model considers a macroeconomic forecast, with unemployment and certain income measures as primary variables. We also perform a qualitative assessment in addition to model estimates and apply qualitative adjustments as necessary.
Current report
We evaluate our Allowance for Credit Losses quarterly. Our estimation process includes analysis of historical data, and there is a significant amount of judgment applied in selecting inputs and analyzing the results produced by the model to determine the Allowance for Credit Losses. Other data utilized in our estimate of expected losses, includes past performance, changes in underwriting policies, bankruptcy activity such as filings and loan volumes and amounts. We also evaluate portfolio risk management techniques applied to various accounts, historical behavior of different account vintages, account seasoning, economic conditions, recent trends in delinquencies and net charge-offs, account collection management including the impact of modifications made to borrowers experiencing financial difficulties, forecasting uncertainties, expectations about the future and a qualitative assessment of the adequacy of the allowance for credit losses. Additionally, the estimate of expected credit losses includes expected recoveries of amounts previously charged-off and expected to be charged-off.
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Removed paragraphs (65)
Previous report
Due to the pending litigation discussed above, which has resulted in a delay in the final rule’s effective date, it remains uncertain whether the final rule will become effective in 2024. As a result, the magnitude of the adverse effects to our results of operations in 2024 also remains uncertain.
Previous report
In anticipation that the final rule will become effective, we are in the process of implementing a number of product, policy and pricing changes to adjust for the significant reduction in our late fee income. The effects of these changes have started to be reflected in our Consolidated Statement of Income for the three and nine months ended September 30, 2024.
Previous report
While we continue to believe that over time, the strategies we have identified and are in the process of implementing will fully offset the decline in late fee income resulting from an effective final rule, it may take time for such product, policy and pricing changes to offset the expected reduction in late fees. In addition, we expect that upon the final rule becoming effective, the combined net effects of the final rule and our mitigating strategies would result in a decrease in payments to partners pursuant to our retailer share arrangements. However, the effects of the final rule are also subject to other factors that could increase the adverse effects to our results of operations, including our ability to successfully implement the product, policy and pricing changes we have identified, as well as any potential changes in consumer behavior in response to these changes or the final rule itself.
Previous report
For a discussion of risks related to a CFPB final late fee rule, please see“—Risk Factors Relating to our Business—The CFPB’s proposed rule on credit card late fees, if adopted, would materially adversely affect our business and results of operations”, in our 2023 Form 10-K.
Previous report
Growth in loan receivables and interest income.
Previous report
During the three months ended September 30, 2024, we experienced a decrease in purchase volume of 4.3% compared to the prior year period, primarily driven by lower consumer spending and the impacts from credit actions we have taken across our portfolio where we have seen indications of higher probability of default. We expect these same factors to now result in a low single digit decrease in purchase volume for the year ending December 31, 2024. As a result, while we still anticipate loan receivables to increase for the remainder of 2024, we expect the rate of growth to moderate.
Previous report
All of the factors discussed above and in our 2023 Form 10-K, such as customer payment behavior and the CFPB final rule on credit card late fees, will continue to have an effect on our loan receivables and interest income. For additional discussion of those factors, please see “Management's Discussion and Analysis of Financial Condition and Results of Operations—Business Trends and Conditions-CFPB final rule on credit card late fees" and "—Growth in loan receivables and interest income” in our 2023 Form 10-K.
Previous report
However, in addition to these seasonal trends, the moderation in customer payment behavior from the previously elevated levels we experienced in recent periods, has also significantly impacted our key financial metrics, such as our net charge-off rate, and also the fluctuations experienced between quarterly periods. The effects from these changes in customer payment behavior have resulted and may continue to result in either partial, or in some instances full, offset to the impact from the ongoing seasonal trends discussed above.
Previous report
•Loan receivables increased 4.4% to $102.2 billion at September 30, 2024 compared to $97.9 billion at September 30, 2023, primarily driven by lower customer payment rates and the completion of the Ally Lending acquisition, partially offset by lower purchase volume.
Previous report
•Net interest income increased 5.7% to $4.6 billion and 7.1% to $13.4 billion for the three and nine months ended September 30, 2024, respectively. Interest and fees on loans increased 7.2% and 10.5% for the three and nine months ended September 30, 2024, respectively, primarily driven by growth in average loan receivables, the impact of our product, pricing and policy changes and lower payment rate, partially offset by higher reversals. For the three and nine months ended September 30, 2024, interest expense increased 18.5% and 33.8%, respectively, due to higher benchmark rates and higher interest-bearing liabilities.
Previous report
•Retailer share arrangements decreased 6.6% to $914 million and 10.6% to $2.5 billion for the three and nine months ended September 30, 2024, respectively, primarily due to higher net charge-offs.
Previous report
•Other income increased by $27 million to $119 million, and by $1.2 billion to $1.4 billion for the three and nine months ended September 30, 2024, respectively. The increase in the three months ended September 30, 2024 was primarily driven by the impact of our product, pricing and policy change related fees, partially offset by the impact of the Pets Best disposition and venture investment gains and losses. The increase in the nine months ended September 30, 2024 was primarily driven by the $1.1 billion gain on sale related to the Pets Best disposition.
Previous report
•In our Home & Auto sales platform, we announced our new partnerships with Bel Furniture and The Carpet Guys and extended our program agreements with Associated Materials, BrandsMart and Jerome's Furniture Warehouse.
Previous report
•In our Lifestyle sales platform, we announced our new partnerships with BRP and Gibson and extended our program agreements with CF Moto, Daniel's, Dick's Sporting Goods, and EC Barton and Reeds.
Previous report
•We added two new strategic technology partnerships with Adit Practice Management Software and ServiceTitan, both of which expand access for customers to our suite of credit products.
Previous report
•We entered into a relationship with Atlanticus Holdings Corporation to deliver a preferred second look financing solution for private label credit cards and installment loan products across our business.
Previous report
Interest income increased by $431 million, or 8.1%, and $1.8 billion, or 11.7%, for the three and nine months ended September 30, 2024, respectively, primarily driven by increases in interest and fees on loans of 7.2% and 10.5%, respectively. The increases in the three and nine months ended September 30, 2024 in interest and fees on loans were primarily driven by growth in average loan receivables, the impact of our product, pricing and policy changes and lower customer payment rates, partially offset by higher reversals.
Previous report
Interest expense increased by $184 million to $1.2 billion, and $888 million to $3.5 billion, for the three and nine months ended September 30, 2024, respectively, due to higher benchmark rates and higher interest-bearing liabilities. Our cost of funds increased to 4.78% and 4.77% for the three and nine months ended September 30, 2024, respectively, compared to 4.34% and 3.95% for the three and nine months ended September 30, 2023, respectively.
Previous report
Retailer share arrangements decreased by $65 million, or 6.6%, and $295 million, or 10.6%, for the three and nine months ended September 30, 2024, respectively, primarily due to higher net charge-offs.
Previous report
Provision for credit losses increased by $109 million, or 7.3%, and $1.0 billion, or 24.3%, for the three and nine months ended September 30, 2024, respectively, primarily driven by higher net charge-offs, partially offset by lower reserve builds in the current year. The net charge-off rate for the three months ended September 30, 2024 increased by 146 basis points to 6.06%, as compared to the prior year period, and was 97 basis points above the average of the third quarters of 2017 through 2019. The reserve build in the nine months ended September 30, 2024 included $180 million related to the Ally Lending acquisition.
Previous report
Other income increased by $27 million to $119 million, and $1.2 billion to $1.4 billion, for the three and nine months ended September 30, 2024, respectively. The increase in other income for the three months ended September 30, 2024 was primarily driven by the impact of our product, pricing and policy change related fees across all five of our sales platforms. This impact was partially offset by lower commission fees following the Pets Best disposition in March 2024 and venture investment losses in the three months ended September 30, 2024 as compared to net investment gains recognized in the prior year period.
Previous report
Other expense increased by $35 million, or 3.0% and by $130 million, or 3.8%, for the three and nine months ended September 30, 2024, respectively.
Previous report
The increase in the three and nine months ended September 30, 2024 were primarily driven by costs related to the Ally Lending acquisition, technology investments, and preparatory expenses related to the late fee rule change, partially offset by lower operational losses. Technology investments primarily reflect higher amortization of capitalized software expenditures.
Previous report
Home & Auto interest and fees on loans increased by $122 million, or 8.9%, and increased by $423 million, or 10.9%, for the three and nine months ended September 30, 2024, respectively, primarily driven by higher average loan receivables and higher benchmark rates. The increase in average loan receivables for both periods primarily reflects the completion of the Ally Lending acquisition as well as the impact of lower customer payment rates, partially offset by lower purchase volume. Purchase volume decreased 7.4% and 4.5% for the three and nine months ended September 30, 2024, as the impact of the Ally Lending acquisition was more than offset by a combination of lower consumer traffic, fewer large ticket purchases and the impact of credit actions.
Previous report
Digital interest and fees on loans increased by $63 million, or 4.1%, and $389 million, or 9.0%, for the three and nine months ended September 30, 2024, respectively, primarily driven by higher average loan receivables, lower payment rates and higher benchmark rates. Purchase volume decreased by 3.3% and 0.4% for the three and nine months ended September 30, 2024, primarily driven by lower consumer spend per account and the impact of credit actions. Average active accounts remained flat and increased by 1.9%, for the three and nine months ended September 30, 2024, respectively.
Previous report
Diversified & Value interest and fees on loans increased by $41 million, or 3.5%, and $259 million, or 7.8%, for the three and nine months ended September 30, 2024, respectively, primarily driven by growth in average loan receivables, lower payment rates and higher benchmark rates. Purchase volume decreased by 2.9% for the three months ended September 30, 2024 primarily driven by lower consumer spend per account and the impact of credit actions. Purchase volume remained flat for the nine months ended September 30, 2024. Average active accounts decreased by 2.2% and 0.6%, for the three and nine months ended September 30, 2024, respectively.
Previous report
Lifestyle interest and fees on loans increased by $21 million, or 8.4%, and $79 million, or 11.2%, for the three and nine months ended September 30, 2024, respectively, primarily driven by growth in average loan receivables and higher benchmark rates. The growth in average loan receivables for both periods reflected lower customer payment rates. Purchase volume decreased by 5.3% and 4.4% for the three and nine months ended September 30, 2024, respectively, reflecting lower transaction values and the impact of credit actions.
Previous report
Loan receivables decreased 0.8% to $102.2 billion at September 30, 2024 compared to $103.0 billion at December 31, 2023, primarily driven by the seasonality of our business and lower purchase volume, partially offset by the Ally Lending acquisition and lower customer payment rates. Loan receivables related to the Ally Lending acquisition are included within Consumer installment loans at September 30, 2024 in the table above.
Previous report
Loan receivables increased 4.4% to $102.2 billion at September 30, 2024 compared to $97.9 billion at September 30, 2023 driven by lower customer payment rates and the completion of the Ally Lending acquisition, partially offset by lower purchase volume.
Previous report
(1)Includes brokered certificates of deposit for which underlying individual deposit balances are assumed to be less than $250,000.
Previous report
During the nine months ended September 30, 2024, we made repayments totaling $1.85 billion of senior unsecured notes issued by Synchrony Financial.
Previous report
On June 20, 2024, the FDIC released a final rule imposing additional requirements for the content of resolution plans submitted by insured depository institutions with $100 billion or more in total assets, including the Bank, following the rule’s effective date of October 1, 2024. Under the final rule, if the FDIC deems a resolution plan filing not credible and the insured depository institution fails to resubmit a credible plan, the institution could become subject to an enforcement action. Our first resolution plan under the final rule is due on July 1, 2025 and we will be required to file a resolution plan once every three years thereafter. Additionally, we will be required to submit interim supplements annually. We are evaluating the impact of the final rule.
Previous report
On July 30, 2024, the FDIC issued a proposed rule that would revise the FDIC’s regulations governing the classification and treatment of brokered deposits. The proposal would, among other changes, broaden the definition of deposit broker to include agents that place or facilitate the placement of third-party deposits at only one insured depository institution and agents that receive a fee or other remuneration in exchange for the placement of deposits. In addition, the proposal would narrow the exception to the definition of deposit broker for agents whose primary purpose is not the placement of funds with depository institutions. While we are evaluating the potential impact of the proposed rule, if the rule is finalized as proposed, the Bank may be required to classify a greater amount of its deposits obtained with the involvement of third parties as brokered deposits. An increase in the amount of brokered deposits on the Bank’s balance sheet could, among other consequences, increase the Bank’s deposit insurance assessment costs.
Previous report
On September 10, 2024, the Vice Chair for Supervision at the Federal Reserve Board (the "Vice Chair"), gave a speech outlining a set of potential revisions to the July 2023 interagency proposed rule to revise the U.S. regulatory capital framework (known as the “Basel Endgame” proposal). In the speech, the Vice Chair indicated that he will recommend that the Federal Reserve Board issue a re-proposal of the rule in which banking organizations with total assets between $100 billion and $250 billion, such as Synchrony, would not be subject to the changes to their capital requirements that were included in the July 2023 Basel Endgame proposal, other than the proposed requirement to recognize unrealized gains and losses of their securities in regulatory capital. It remains uncertain whether the federal banking agencies will re-propose the Basel Endgame rule, and if so, whether the agencies will adopt the Vice Chair’s recommendations.
Previous report
On September 17, 2024, the OCC finalized a new Policy Statement Regarding Statutory Factors Under the Bank Merger Act (the “Policy Statement”), which outlines factors that the OCC will consider when evaluating a proposed bank merger transaction. Also on September 17, 2024, the United States Department of Justice (the “DOJ”) withdrew its 1995 Bank Merger Guidelines and announced that it will instead evaluate the competitive impact of bank mergers using its 2023 Merger Guidelines that the DOJ applies to mergers in all industries. Compared to the 1995 Bank Merger Guidelines, the 2023 Merger Guidelines set forth more stringent concentration limits and add several largely qualitative bases on which the DOJ may challenge a merger. While the effect of these changes for particular transactions remains unclear, both the Policy Statement and the change in the DOJ’s bank merger antitrust policy may make it more difficult and/or costly for us to obtain regulatory approval for an acquisition or may otherwise result in more onerous conditions to obtain approval for an acquisition.
Previous report
Equity Method Investments
Previous report
We use the equity method of accounting for investments where we have significant influence, but not control, over the operating and financial policies of the investee. Our assessment of significant influence includes factors such as our ownership interest, legal form, and representation on the board of directors. The Company generally records the initial investment at cost or fair value, as appropriate. Subsequently, we adjust each investment for our proportionate share of net income or loss in the investee. We amortize, where appropriate, differences between the Company’s cost basis and underlying equity in net assets, which are reported in Other Income. The Company evaluates equity method investments for other-than-temporary impairment when events or changes in circumstance indicate that the carrying amount of the investment might not be recoverable.
Previous report
The Ally Lending acquisition has been accounted for as a business combination using the acquisition method of accounting and, accordingly, assets acquired and liabilities assumed were recorded at their estimated fair value as of the acquisition date.
Previous report
There were no adjustments to the fair value of assets acquired and liabilities assumed (measurement period adjustments) related to the acquisition during the three months ended September 30, 2024. During the nine months ended September 30, 2024, measurement period adjustments were recognized related to the acquisition as detailed in the table below.
Previous report
(a) Loan discounts are recognized into interest income over the estimated remaining life of the acquired loans. The were no changes to the provisional amount of loan discount recorded in the three months ended September 30, 2024.
Showing the first 40 of 65 passages. Open the source sections for the rest.
Reworded paragraphs (113)
Previous wording
We are a premier consumer financial services company delivering one of the industry's most complete, digitally-enabled product suites. Our experience, expertise and scale encompass a broad spectrum of industries including digital, health and wellness, retail, telecommunications, home, auto, outdoor, pet and more. We have an established and diverse group of national and regional retailers, local merchants, manufacturers, buying groups, industry associations and healthcare service providers, which we refer to as our “partners.” For the three and nine months ended September 30, 2024, we financed $45.0 billion and $134.2 billion of purchase volume, respectively, and had 70.4 million and 71.1 million average active accounts, respectively, and at September 30, 2024, we had $102.2 billion of loan receivables.
Current wording
We are a premier consumer financial services company delivering one of the industry's most complete digitally-enabled product suites. Our experience, expertise and scale encompass a broad spectrum of industries including digital, health and wellness, retail, telecommunications, home, auto, outdoor, pet and more. We have an established and diverse group of national and regional retailers, local merchants, manufacturers, buying groups, industry associations and healthcare service providers, which we refer to as our “partners.” For the three months ended March 31, 2025, we financed $40.7 billion of purchase volume and had 69.3 million average active accounts and at March 31, 2025, we had $99.6 billion of loan receivables.
Previous wording
We offer our credit products primarily through our wholly-owned subsidiary, the Bank. In addition, through the Bank, we offer, directly to retail, affinity relationships and commercial customers, a range of deposit products insured by the Federal Deposit Insurance Corporation (“FDIC”), including certificates of deposit, individual retirement accounts (“IRAs”), money market accounts, savings accounts and sweep and affinity deposits. We also take deposits at the Bank through third-party securities brokerage firms that offer our FDIC-insured deposit products to their customers. We have significantly expanded our online direct banking operations in recent years and our deposit base has continued to serve as a source of stable and diversified low cost funding for our credit activities. At September 30, 2024, we had $82.3 billion in deposits, which represented 84% of our total funding sources.
Current wording
We offer our credit products primarily through our wholly-owned subsidiary, the Bank. In addition, through the Bank, we offer, directly to retail, affinity relationships and commercial customers, a range of deposit products insured by the Federal Deposit Insurance Corporation (“FDIC”), including certificates of deposit, individual retirement accounts (“IRAs”), money market accounts, savings accounts and sweep and affinity deposits. We also take deposits at the Bank through third-party securities brokerage firms that offer our FDIC-insured deposit products to their customers. Our deposit base has continued to serve as a source of stable and diversified low-cost funding for our credit activities. At March 31, 2025, we had $83.4 billion in deposits, which represented 83% of our total funding sources.
Previous wording
We conduct our operations through a single business segment. Profitability and expenses, including funding costs, credit losses and operating expenses, are managed for the business as a whole. Substantially all of our revenue activities are within the United States. We primarily manage our credit products through five sales platforms (Home & Auto, Digital, Diversified & Value, Health & Wellness and Lifestyle). Those platforms are organized by the types of partners we work with, and are measured on interest and fees on loans, loan receivables, active accounts and other sales metrics.
Current wording
We conduct our operations through a single business segment. Profitability and expenses, including funding costs, credit losses and operating expenses, are managed for the business as a whole. Substantially all of our revenue generating activities are within the United States and are aligned through five sales platforms (Home & Auto, Digital, Diversified & Value, Health & Wellness and Lifestyle). Those platforms are organized by the types of partners we work with, and are measured on interest and fees on loans, loan receivables, active accounts and other sales metrics.
Previous wording
Our Home & Auto sales platform provides comprehensive payments and financing solutions with integrated in-store and digital experiences through a broad network of partners and merchants providing home and automotive merchandise and services, as well as our Synchrony Car Care network and Synchrony HOME credit card offering. Our Home & Auto sales platform partners include a wide range of key retailers in the home improvement, furniture, bedding, flooring, appliance and electronics industry, such as Ashley HomeStores LTD, Floor & Decor, Lowe's, and Mattress Firm, as well as automotive merchandise and services, such as Chevron and Discount Tire. In addition, we also have program agreements with manufacturers, buying groups and industry associations, such as Generac, Nationwide Marketing Group and the Home Furnishings Association.
Current wording
Our Home & Auto sales platform provides comprehensive payments and financing solutions with integrated in-store and digital experiences through a broad network of partners and merchants providing home and automotive merchandise and services, as well as our Synchrony Car Care network and Synchrony HOME credit card offering. In March 2024, we completed our acquisition of Ally Financial Inc.'s point-of-sale financing business ("Ally Lending"), which deepened our presence in the home improvement sector, including specialty areas such as roofing, HVAC and windows. Our Home & Auto sales platform partners include a wide range of key retailers in the home improvement, furniture, bedding, flooring, appliance and electronics industry, such as Ashley HomeStores, Inc., Floor & Decor, Lowe's, and Mattress Firm, as well as automotive merchandise and services, such as Chevron and Discount Tire. In addition, we also have program agreements with manufacturers, buying groups and industry associations, such as Generac, Nationwide Marketing Group and the Home Furnishings Association.
Previous wording
Our Digital sales platform provides comprehensive payments and financing solutions with integrated digital experiences through partners and merchants who primarily engage with their consumers through digital channels. Our Digital sales platform includes key partners delivering digital payment solutions, such as PayPal, including our Venmo program, online marketplaces, such as Amazon and eBay, and digital-first brands and merchants, such as Verizon, the Qurate brands, and Fanatics.
Current wording
Our Digital sales platform provides comprehensive payments and financing solutions with integrated digital experiences through partners and merchants who primarily engage with their consumers through digital channels. Our Digital sales platform includes key partners delivering digital payment solutions, such as PayPal, including our Venmo program, online marketplaces, such as Amazon and eBay, and digital-first brands and merchants, such as the Qurate brands, Verizon, and Virgin Red.
Previous wording
Our Health & Wellness sales platform provides comprehensive healthcare payments and financing solutions, through a network of providers and health systems, for those seeking health and wellness care for themselves, their families and their pets, and includes our CareCredit brand, as well as partners such as Walgreens.
Current wording
Our Health & Wellness sales platform provides comprehensive healthcare payments and financing solutions, through a network of providers and health related retail locations, for those seeking health and wellness care for themselves, their families and their pets, and includes our CareCredit brand, as well as partners such as Walgreens.
Previous wording
•Dual Cards and General Purpose Co-Branded Cards. Our patented Dual Cards are credit cards that function as private label credit cards when used to purchase goods and services from our partners, and as general purpose credit cards when used to make purchases from other retailers wherever cards from those card networks are accepted or for cash advance transactions. We also offer general purpose co-branded credit cards that do not function as private label credit cards, as well as a Synchrony-branded general purpose credit card. Dual Cards and general purpose co-branded credit cards are offered across all of our sales platforms and credit is typically extended on standard terms only. We offer either Dual Cards or general purpose co-branded credit cards through over 15 of our large partners, of which the majority are Dual Cards, as well as our CareCredit Dual Card. Consumer Dual Cards and Co-Branded cards totaled 26% of our total loan receivables portfolio at September 30, 2024.
Current wording
•Dual Cards and General Purpose Co-Branded Cards. Our patented Dual Cards are credit cards that function as private label credit cards when used to purchase goods and services from our partners, and as general purpose credit cards when used to make purchases from other retailers wherever cards from those card networks are accepted or for cash advance transactions. We also offer general purpose co-branded credit cards that do not function as private label credit cards, as well as a Synchrony-branded general purpose credit card. Dual Cards and general purpose co-branded credit cards are offered across all of our sales platforms and credit is typically extended on standard terms only. We offer either Dual Cards or general purpose co-branded credit cards through over 15 of our large partners, of which the majority are Dual Cards, as well as our CareCredit Dual Card. Consumer Dual Cards and Co-Branded cards totaled 28% of our total loan receivables portfolio at March 31, 2025.
Previous wording
We originate secured installment loans to consumers (and a limited number of commercial customers) in the United States, primarily for power products in our Outdoor market (motorcycles, ATVs and lawn and garden). We also offer unsecured installment loans primarily in our Home and Auto and Health and Wellness sales platforms and through our various other installment products, such as our Synchrony Pay Later solutions, including pay monthly and pay in 4 products, for short-term loans. Installment loans are closed-end credit accounts where the customer pays down the outstanding balance in installments. Installment loans are generally assessed periodic finance charges using fixed interest rates. Installment loans at September 30, 2024 include loan receivables related to Ally Financial Inc.'s point of sale financing business, ("Ally Lending") that was acquired in March 2024.
Current wording
We originate secured installment loans to consumers (and a limited number of commercial customers) in the United States, primarily for power products in our Outdoor market (motorcycles, ATVs and lawn and garden). We also offer unsecured installment loans primarily in our Home & Auto and Health & Wellness sales platforms and through our various other installment products, such as our Synchrony Pay Later solutions, including pay monthly and Pay in 4 products, for short-term loans. Installment loans are closed-end credit accounts where the customer pays down the outstanding balance in installments. Installment loans are generally assessed periodic finance charges using fixed interest rates.
Previous wording
We believe our business and results of operations will be impacted in the future by various trends and conditions. For a discussion of certain trends and conditions, see “Management's Discussion and Analysis of Financial Condition and Results of Operations—Business Trends and Conditions” in our 2023 Form 10-K. For a discussion of how certain trends and conditions impacted the three and nine months ended September 30, 2024, see “—Results of Operations.”
Current wording
We believe our business and results of operations will be impacted in the future by various trends and conditions. For a discussion of certain trends and conditions, see “Management's Discussion and Analysis of Financial Condition and Results of Operations—Business Trends and Conditions” in our 2024 Form 10-K and see below for recent developments. For a discussion of how certain trends and conditions impacted the three months ended March 31, 2025, see “—Results of Operations.”
Previous wording
On March 5, 2024, the CFPB released a final rule amending its regulations that implement the Truth in Lending Act to, among other things, lower the safe harbor dollar amount for credit card late fees from the prior $30 (adjusted to $41 for each subsequent late payment within the next six billing cycles) to $8 and to eliminate the automatic annual inflation adjustment to such safe harbor dollar amount. The final rule had an original effective date of May 14, 2024. Industry organizations have challenged the final rule in court, and on May 10, 2024, the United States District Court for the Northern District of Texas granted an injunction and stay of the final rule, and the injunction granted remains in effect. The final outcome of such challenge, including the impact on the final rule, is uncertain. See"Business Trends and Conditions" above for the anticipated financial impacts related to the final rule.
Current wording
On March 5, 2024, the CFPB released a final rule amending its regulations that implement the Truth in Lending Act to lower the safe harbor dollar amount for credit card late fees from the prior $30 (adjusted to $41 for each subsequent late payment within the next six billing cycles) to $8 and to eliminate the automatic annual inflation adjustment to such safe harbor dollar amount. The final rule had an original effective date of May 14, 2024. Industry organizations challenged the final rule in court, and on May 10, 2024, the United States District Court for the Northern District of Texas granted an injunction and stay of the final rule.
Previous wording
We experience fluctuations in transaction volumes and the level of loan receivables as a result of higher seasonal consumer spending and payment patterns that typically result in an increase of loan receivables from August through a peak in late December, with reductions in loan receivables typically occurring over the first and second quarters of the following year as customers pay their balances down.
Current wording
We experience fluctuations in purchase volume and the level of loan receivables as a result of higher seasonal consumer spending and payment patterns that typically result in an increase of loan receivables from August through a peak in late December, with reductions in loan receivables typically occurring over the first and second quarters of the following year as customers pay their balances down.
Previous wording
The seasonal impact to transaction volumes and the loan receivables balance typically results in fluctuations in our results of operations, delinquency metrics and the allowance for credit losses as a percentage of total loan receivables between quarterly periods.
Current wording
The seasonal impact to purchase volume and the loan receivables balance typically results in fluctuations in our results of operations, delinquency metrics and the allowance for credit losses as a percentage of total loan receivables between quarterly periods.
Previous wording
Highlights for the Three and Nine Months Ended September 30, 2024
Current wording
Highlights for the Three Months Ended March 31, 2025
Previous wording
Below are highlights of our performance for the three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023, as applicable, except as otherwise noted.
Current wording
Below are highlights of our performance for the three months ended March 31, 2025 compared to the three months ended March 31, 2024, as applicable, except as otherwise noted.
Previous wording
•Net earnings increased to $789 million from $628 million and to $2.7 billion from $1.8 billion for the three and nine months ended September 30, 2024. The increase in the three months ended September 30, 2024 was primarily driven by higher net interest income and lower retailer share arrangements, partially offset by an increase in provision for credit losses. The increase in the nine months ended September 30, 2024 was primarily driven by the after-tax gain on sale related to Pets Best of $802 million, as well as the same trends experienced in the three months ended September 30, 2024.
Current wording
•Net earnings decreased to $757 million from $1.3 billion for the three months ended March 31, 2025. The decrease in the three months ended March 31, 2025 was primarily driven by the after-tax gain on sale related to Pets Best of $802 million in the prior year, and higher retailer share arrangements, partially offset by a decrease in provision for credit losses.
Previous wording
•Over-30 day loan delinquencies as a percentage of period-end loan receivables increased 38 basis points to 4.78% at September 30, 2024 compared to September 30, 2023. The net charge-off rate increased 146 basis points to 6.06% and increased 164 basis points to 6.26% for the three and nine months ended September 30, 2024, respectively.
Current wording
•Over-30 day loan delinquencies as a percentage of period-end loan receivables decreased 22 basis points to 4.52% at March 31, 2025 compared to March 31, 2024. The net charge-off rate increased 7 basis points to 6.38% for the three months ended March 31, 2025.
Previous wording
•Provision for credit losses increased by $109 million, or 7.3%, and $1.0 billion, or 24.3%, for the three and nine months ended September 30, 2024, respectively, primarily driven by higher net charge-offs, partially offset by lower reserve builds. The reserve build in the nine months ended September 30, 2024 included $180 million related to the Ally Lending acquisition. Our allowance coverage ratio (allowance for credit losses as a percentage of period-end loan receivables) increased to 10.79% at September 30, 2024, as compared to 10.40% at September 30, 2023.
Current wording
•Provision for credit losses decreased by $393 million, or 20.9%, for the three months ended March 31, 2025, primarily driven by a reserve release of $97 million versus a reserve build of $299 million in the prior year which included a $190 million reserve build related to the Ally Lending acquisition. Our allowance coverage ratio (allowance for credit losses as a percentage of period-end loan receivables) increased to 10.87% at March 31, 2025, as compared to 10.72% at March 31, 2024.
Previous wording
•Other expense increased by $35 million, or 3.0%, and $130 million, or 3.8%, for the three and nine months ended September 30, 2024, respectively. The increase in the three and nine months ended September 30, 2024 was primarily driven by costs related to the Ally Lending acquisition, technology investments, and preparatory expenses related to the late fee rule change, partially offset by lower operational losses.
Current wording
•Other expense increased by $37 million, or 3.1%, for the three months ended March 31, 2025. The increase in the three months ended March 31, 2025 was primarily driven by costs related to technology investments, and also included the impacts of a charitable contribution and a restructuring charge related to our Ally Lending business.
Previous wording
•At September 30, 2024, deposits represented 84% of our total funding sources. Total deposits increased by 1.4% to $82.3 billion at September 30, 2024, compared to December 31, 2023.
Current wording
•At March 31, 2025, deposits represented 83% of our total funding sources. Total deposits increased by 1.7% to $83.4 billion at March 31, 2025, compared to December 31, 2024.
Previous wording
•During the nine months ended September 30, 2024, we declared and paid cash dividends totaling $51 million on our Series A 5.625% fixed rate non-cumulative perpetual preferred stock and our Series B 8.250% fixed rate reset non-cumulative perpetual preferred stock.
Current wording
•During the three months ended March 31, 2025, we declared and paid cash dividends totaling $21 million on our Series A 5.625% fixed rate non-cumulative perpetual preferred stock and our Series B 8.250% fixed rate reset non-cumulative perpetual preferred stock.
Previous wording
•During the nine months ended September 30, 2024, we repurchased $900 million of our outstanding common stock, and declared and paid cash dividends of $0.75 per share, or $301 million in the aggregate. In April 2024, the Board of Directors approved an incremental share repurchase program of up to $1.0 billion, through June 30, 2025, and maintained the quarterly dividend at its current amount of $0.25 per common share. At September 30, 2024 we had a total share repurchase authorization of $700 million remaining. For more information, see “Capital—Dividend and Share Repurchases.”
Current wording
•During the three months ended March 31, 2025, we repurchased $600 million of our outstanding common stock, and declared and paid cash dividends of $0.25 per share, or $97 million in the aggregate. At March 31, 2025, we completed our prior share repurchase program, and in April 2025 we announced that the Board of Directors approved a new share repurchase program of up to $2.5 billion, through June 30, 2026, and increased our quarterly dividend to $0.30 per common share commencing in the second quarter of 2025. For more information, see “Capital—Dividend and Share Repurchases.”
Previous wording
During the nine months ended September 30, 2024, we continued to expand and diversify our portfolio with the addition or renewal of more than 55 partners, as well as enter new strategic relationships, which included the following:
Current wording
During the three months ended March 31, 2025, and to date, we continued to expand and diversify our portfolio with the addition or renewal of more than 10 partners, which included the following:
Previous wording
•In our Digital sales platform, we announced our new partnership with Virgin Red and extended our program agreement with Cathay Pacific and Verizon.
Current wording
•In our Digital sales platform, we announced our new partnership with Sun Country Airlines.
Previous wording
•In our Health & Wellness sales platform, we expanded our network through our new partnerships with Bond Veterinary, Lakefield Veterinary Group, LaserAway and Western Veterinary and extended our program agreements with Bosley, Innovetive, LCA Vision and SCI. We also launched the integration of our CareCredit card with Pets Best to enable direct insurance claim reimbursement for customers.
Current wording
•In our Health & Wellness sales platform, we expanded our network through our new partnership with Texas A&M University Veterinary Medical Teaching Hospital.
Previous wording
(2)Includes average restricted cash balances of $57 million and $151 million for the three months ended September 30, 2024 and 2023, respectively, and $76 million and $324 million for the nine months ended September 30, 2024 and 2023, respectively.
Current wording
(2)Includes average restricted cash balances of $690 million and $109 million for the three months ended March 31, 2025 and 2024, respectively.
Previous wording
(3)Interest income on loan receivables includes fees on loans, which primarily consist of late fees on our credit products, of $652 million and $694 million for the three months ended September 30, 2024 and 2023, respectively, and $1.9 billion and $2.0 billion for the nine months ended September 30, 2024 and 2023, respectively.
Current wording
(3)Interest income on loan receivables includes fees on loans, which primarily consist of late fees on our credit products, of $588 million and $652 million for the three months ended March 31, 2025 and 2024, respectively.
Previous wording
Average loan receivables, including held for sale, increased 6.0% and 8.9% for the three and nine months ended September 30, 2024, respectively, primarily driven by lower customer payment rates and the impact of the Ally Lending acquisition, partially offset by lower purchase volume. Purchase volume decreased by 4.3% and 1.2% for the three and nine months ended September 30, 2024, respectively, reflecting lower consumer spend as well as the impact of credit actions, partially offset by the Ally Lending acquisition. The decrease for the nine months ended September 30, 2024 was also partially offset by growth in average active accounts of 1.7%.
Current wording
Average loan receivables, including held for sale, was flat for the three months ended March 31, 2025, primarily driven by the impact of the Ally Lending acquisition, offset by lower purchase volume. Purchase volume decreased by 3.9% for the three months ended March 31, 2025, primarily reflecting lower consumer spend as well as the impact of credit actions.
Previous wording
The yield on average interest-earning assets increased for the three and nine months ended September 30, 2024 primarily due to increases in the yield on average loan receivables. The loan receivable yield increased 30 basis points for both the three and nine months ended September 30, 2024 to 21.54% and 21.21%, respectively.
Current wording
The yield on average interest-earning assets decreased for the three months ended March 31, 2025 primarily due to a lower yield on our liquidity portfolio, partially offset by an increase in the yield on average loan receivables. The loan receivable yield increased 24 basis points for the three months ended March 31, 2025 to 21.33%, driven by the impacts of our product, pricing and policy changes, partially offset by lower benchmark rates and lower late fee incidence.
Previous wording
Net interest income increased by $247 million, or 5.7%, and $886 million, or 7.1%, for the three and nine months ended September 30, 2024, respectively, resulting from the changes in interest income and interest expense discussed above.
Current wording
Net interest income increased by $59 million, or 1.3%, for the three months ended March 31, 2025, resulting from the changes in interest income and interest expense discussed above.
Previous wording
The increase for the nine months ended September 30, 2024 was primarily driven by the gain on sale related to the Pets Best disposition. The pre-tax gain amount of $1.1 billion is included within the Other component of Other Income in our Condensed Consolidated Statements of Earnings for the nine months ended September 30, 2024.
Current wording
Other income decreased by $1.0 billion to $149 million for the three months ended March 31, 2025, primarily driven by a $1.1 billion gain on sale related to Pets Best in the prior year, partially offset by the impact of our product, pricing and policy change related fees. The pre-tax gain amount of $1.1 billion was included within the Other component of Other Income in our Condensed Consolidated Statements of Earnings.
Previous wording
The effective tax rate for the three months ended September 30, 2024 decreased compared to the same period in the prior year primarily due to the resolution of certain tax matters in the current period. The effective tax rate for the nine months ended September 30, 2024 decreased slightly compared to the same period in the prior year. For both periods presented, the effective tax rate differs from the applicable U.S. federal statutory tax rate primarily due to state income taxes.
Current wording
The effective tax rate for the three months ended March 31, 2025 decreased compared to the same period in the prior year primarily due to an increase in tax benefits from stock-based compensation in the current period combined with a reduction in pretax income. The effective tax rate differs from the applicable U.S. federal statutory tax rate primarily due to state income taxes.
Previous wording
As discussed above under “—Our Sales Platforms,” we offer our credit products primarily through five sales platforms (Home & Auto, Digital, Diversified & Value, Health & Wellness and Lifestyle), which management measures based on their revenue-generating activities. The following is a discussion of certain supplemental information for the three and nine months ended September 30, 2024, for each of our five sales platforms and Corp, Other.
Current wording
As discussed above under “—Our Sales Platforms,” we offer our credit products primarily through five sales platforms (Home & Auto, Digital, Diversified & Value, Health & Wellness and Lifestyle). The following is a discussion of certain supplemental information for the three months ended March 31, 2025, for each of our five sales platforms and Corp, Other.
Previous wording
Other income increased by $28 million, or 100.0%, and $47 million, or 58.8%, for the three and nine months ended September 30, 2024, respectively. The increases for the three and nine months ended September 30, 2024 were primarily due to the impact of product, pricing and policy change related fees, lower loyalty costs and higher protection product revenue.
Current wording
Other income increased by $24 million, or 72.7%, for the three months ended March 31, 2025 was primarily due to the impact of product, pricing and policy change related fees and lower loyalty costs.
Previous wording
Health & Wellness interest and fees on loans increased by $112 million, or 13.3%, and $371 million, or 15.7%, for the three and nine months ended September 30, 2024, respectively, primarily driven by higher average loan receivables. The growth in average loan receivables for both periods reflected higher purchase volume over the last 12 months and lower customer payment rates, as well as the completion of the Ally Lending acquisition. Purchase volume decreased 3.1%, and average active accounts increased 7.2% for the three months ended September 30, 2024, as lower spend in Dental, Cosmetic and Vision, combined with the impact of credit actions, was partially offset by growth in Pet and Audiology. Purchase volume increased 2.1%, and average active accounts increased 9.0% for the nine months ended September 30, 2024, reflecting growth in Pet and Audiology, partially offset by lower spend in Vision and Dental.
Current wording
Health & Wellness interest and fees on loans increased by $45 million, or 5.2%, for the three months ended March 31, 2025, primarily driven by growth in average loan receivables and higher loan receivables yield, reflecting the impact of product, pricing and policy changes, partially offset by higher reversals. The growth in average loan receivables includes the impact from the Ally Lending acquisition in March 2024. Purchase volume decreased 5.2%, for the three months ended March 31, 2025, reflecting lower spend in industries such as Dental, Cosmetic and Vision, combined with the impact of credit actions, partially offset by growth in Pet and Audiology. Average active accounts increased 2.2% for the three months ended March 31, 2025.
Previous wording
Other income decreased by $6 million, or 8.1%, and $7 million, or 3.7%, for the three and nine months ended September 30, 2024, respectively. The decreases for the three and nine months ended September 30, 2024 were primarily due to lower commission fees following the Pets Best disposition, partially offset by higher protection product revenue and the impact of product, pricing and policy change related fees.
Current wording
Other income increased by $9 million, or 13.6%, for the three months ended March 31, 2025, primarily due lower loyalty costs and the impact of product, pricing, and policy change related fees, partially offset by lower commission fees following the Pets Best disposition.
Previous wording
Other income for the nine months ended September 30, 2024 in Corp, Other primarily included the gain on sale related to the Pets Best disposition of $1.1 billion.
Current wording
Other income for the three months ended March 31, 2024 in Corp, Other primarily included the gain on sale related to the Pets Best disposition of $1.1 billion.
Previous wording
Over-30 day loan delinquencies as a percentage of period-end loan receivables increased to 4.78% at September 30, 2024 from 4.40% at September 30, 2023, and increased from 4.74% at December 31, 2023. These increases were primarily driven by lower customer payment rates.
Current wording
Over-30 day loan delinquencies as a percentage of period-end loan receivables decreased to 4.52% at March 31, 2025 from 4.74% at March 31, 2024, and decreased from 4.70% at December 31, 2024. These decreases include the impact of the credit actions we have previously taken across our portfolio.
Previous wording
The allowance for credit losses totaled $11.0 billion at September 30, 2024, compared to $10.6 billion at December 31, 2023, respectively, and $10.2 billion at September 30, 2023, and reflects our estimate of expected credit losses for the life of the loan receivables on our Condensed Consolidated Statement of Financial Position. Our allowance for credit losses as a percentage of total period end loan receivables increased to 10.79% at September 30, 2024, from 10.26% at December 31, 2023 and increased from 10.40% at September 30, 2023.
Current wording
The allowance for credit losses totaled $10.8 billion at March 31, 2025, compared to $10.9 billion at December 31, 2024, respectively, and $10.9 billion at March 31, 2024, and reflects our estimate of expected credit losses for the life of the loan receivables on our Condensed Consolidated Statements of Financial Position. Our allowance for credit losses as a percentage of total period end loan receivables increased to 10.87% at March 31, 2025, from 10.44% at December 31, 2024 and increased from 10.72% at March 31, 2024.
Previous wording
The increase in allowance for credit losses compared to December 31, 2023 and September 30, 2023 includes the addition of the Ally Lending portfolio. See Note 5. Loan Receivables and Allowance for Credit Losses to our condensed consolidated financial statements for additional information.
Current wording
The decrease in allowance for credit losses compared to December 31, 2024 and March 31, 2024 primarily reflects the decrease in both loan receivables and delinquent balances as a percentage of loan receivables, as compared to the prior year period, as well as expectations of the macroeconomic environment. See Note 5. Loan Receivables and Allowance for Credit Losses to our condensed consolidated financial statements for additional information.
Previous wording
(1)Excludes $387 million and $401 million average balance of non-interest-bearing deposits for the three months ended September 30, 2024 and 2023, respectively. Non-interest-bearing deposits comprise less than 10% of total deposits for the three months ended September 30, 2024 and 2023.
Current wording
(1)Excludes $418 million and $390 million average balance of non-interest-bearing deposits for the three months ended March 31, 2025 and 2024, respectively. Non-interest-bearing deposits comprise less than 10% of total deposits for the three months ended March 31, 2025 and 2024.
Showing the first 40 of 113 pairs. Open the source sections for the rest.
Rearranged current paragraphs (3)
Current report — wording carried from elsewhere
INDEX TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Current report — wording carried from elsewhere
At both March 31, 2025 and December 31, 2024, we had:
Current report — wording carried from elsewhere
(e)Includes demand deposits with no defined maturity.
Rearranged previous paragraphs (6)
Previous report — wording carried elsewhere
•In March 2024, we sold our wholly-owned subsidiary, Pets Best, for consideration comprising a combination of cash and an equity interest in Independence Pet Holdings, Inc. The sale resulted in the recognition of a gain on sale of $1.1 billion, or $802 million net of tax.
Previous report — wording carried elsewhere
•In March 2024, we acquired Ally Lending for cash consideration of $2.0 billion. The assets and liabilities of Ally Lending primarily included loan receivables with an unpaid principal balance of $2.2 billion. See Note 3. Acquisitions and Dispositions to our condensed consolidated financial statements for additional information.
Previous report — wording carried elsewhere
(1)Excludes $391 million and $410 million average balance of non-interest-bearing deposits for the nine months ended September 30, 2024 and 2023, respectively. Non-interest-bearing deposits comprise less than 10% of total deposits for the nine months ended September 30, 2024 and 2023.
Previous report — wording carried elsewhere
In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. This ASU improves reportable segment disclosure requirements and requires enhanced disclosures about significant segment expenses. The Company will adopt this guidance on a retrospective basis on its effective date, which for us is beginning within our December 31, 2024 Form 10-K.
Previous report — wording carried elsewhere
As part of our loan modifications to borrowers experiencing financial difficulty, we may provide multiple concessions to minimize our economic loss and improve long-term loan performance and collectability.
Previous report — wording carried elsewhere
(c)Interest rate fixed through August 1, 2029; resets August 2, 2029 to floating rate based on compounded Secured Overnight Financing Rate ("SOFR") plus 213 basis points.