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    Synchrony Financial (SYF)

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    Synchrony Financial is a premier consumer financial services company that offers a comprehensive suite of digitally-enabled products across various industries, including digital, health and wellness, retail, telecommunications, home, auto, outdoor, and pet sectors . The company primarily provides credit products through financing programs established with national and regional retailers, local merchants, manufacturers, buying groups, industry associations, and healthcare service providers . Synchrony's product offerings include private label, dual, co-brand, and general-purpose credit cards, as well as short- and long-term installment loans and consumer banking products .

    1. Home & Auto - Offers credit products tailored for home improvement and automotive purchases, working with partners in these sectors to provide financing solutions.
    2. Digital - Provides credit solutions for digital platforms, enhancing online shopping experiences through partnerships with major e-commerce and digital service providers.
    3. Diversified & Value - Delivers a range of credit products to partners in various retail sectors, focusing on value-driven consumer segments.
    4. Health & Wellness - Supplies financing options for healthcare services, collaborating with healthcare providers to offer patients flexible payment plans.
    5. Lifestyle - Caters to lifestyle-oriented sectors, including outdoor and pet industries, by offering credit products that support consumer purchases in these areas.
    NamePositionStart DateShort Bio
    Alberto CasellasExecutive Vice President and CEO—Health & WellnessJune 2021Alberto Casellas is the Executive Vice President and CEO of the Health & Wellness platform at Synchrony Financial. He previously served as CEO of Synchrony's CareCredit platform and held various leadership roles at GE .
    Curtis HowseExecutive Vice President and CEO—Home & AutoJune 2021Curtis Howse is the Executive Vice President and CEO of the Home & Auto platform at Synchrony Financial. He has held various roles at Synchrony and GE, including leading Direct to Consumer efforts and the Diversified Client Group .
    Carol JuelExecutive Vice President, Chief Technology and Operating OfficerJune 2021Carol Juel is the Executive Vice President, Chief Technology and Operating Officer at Synchrony Financial. She has a background in technology leadership roles at GE and Accenture .
    David P. MelitoSenior Vice President, Chief Accounting Officer and ControllerFebruary 2014David P. Melito has been the Senior Vice President, Chief Accounting Officer, and Controller at Synchrony Financial since February 2014. He previously held various accounting roles at GE .
    Jonathan S. MothnerExecutive Vice President, Chief Risk and Legal OfficerNovember 2023Jonathan S. Mothner is the Executive Vice President, Chief Risk and Legal Officer at Synchrony Financial. He previously served as the Executive Vice President, General Counsel, and Secretary .
    Maran NalluswamiExecutive Vice President and CEO—Diversified & Value and LifestyleJanuary 2023Maran Nalluswami is the Executive Vice President and CEO of the Diversified & Value and Lifestyle platforms at Synchrony Financial. He has held various roles at GE Capital and Synchrony .
    Bart SchallerExecutive Vice President and CEO—DigitalJune 2021Bart Schaller has been the Executive Vice President and CEO of the Digital platform at Synchrony Financial since June 2021. He previously served as the Chief Marketing Officer of Synchrony .
    Brian J. Wenzel, Sr.Executive Vice President, Chief Financial OfficerMay 2019Brian J. Wenzel, Sr. has been the Chief Financial Officer of Synchrony Financial since May 2019. He has held various financial roles at Synchrony and GE .
    Brian D. DoublesPresident and Chief Executive OfficerApril 2021Brian D. Doubles has been the President and Chief Executive Officer of Synchrony Financial since April 2021. He has served as a director and has been a member of the board of directors of Synchrony Bank since 2009 .
    Daniel ColaoBoard of Directors MemberOctober 1, 2024Daniel Colao was appointed to the Board of Directors of Synchrony Financial, effective October 1, 2024. He has over 30 years of industry experience and previously served as CFO and Executive Advisor of GE Capital .
    1. Regarding the CFPB's pending late fee rule change, can you provide a detailed update on the litigation status and how the potential implementation of an $8 late fee safe harbor could impact your financial performance and strategy?

    2. With the observed moderation in consumer discretionary spending, particularly in categories like furniture, electronics, and cosmetics, how are you adjusting your growth strategy in the Health and Wellness segment to address the slowdown in bigger ticket discretionary purchases?

    3. You've mentioned the implementation of proactive pricing and policy changes in response to the anticipated late fee rule changes. How confident are you in achieving earnings neutrality through these measures, and can you elaborate on any early indications of customer behavior shifts, such as lower paper statement fee income and customer attrition?

    4. Given the ongoing challenges in late-stage collections and the evolution of collection rules, how are you adapting your collection strategies to improve recovery rates, and what impact do you anticipate this will have on your credit performance moving forward?

    5. The guidance for reserve coverage at the end of the year suggests a larger seasonal step-down compared to previous years. Can you explain the factors driving this expectation, and how changes in macroeconomic conditions or consumer payment behavior are influencing your provisioning?

    Program DetailsProgram 1
    Approval DateApril 2024
    End Date/DurationJune 30, 2025
    Total additional amount$1.0 billion
    Remaining authorization amount$700 million as of September 30, 2024
    DetailsIncremental share repurchase program
    YearAmount Due ($ in millions)Debt TypeInterest Rate (%)% of Total Debt
    2024175 Borrowings of Consolidated Securitization Entities5.81-6.07 1.1% = (175 / 15,632) * 100
    20255,650 Fixed Senior Unsecured Notes4.500-5.400 36.2% = (5,650 / 15,632) * 100
    20263,250 Fixed Senior Unsecured Notes3.700 20.8% = (3,250 / 15,632) * 100
    20273,700 Fixed Senior Unsecured Notes3.950-5.625 23.7% = (3,700 / 15,632) * 100
    20280 N/AN/A0.0% = (0 / 15,632) * 100
    Thereafter2,900 Fixed and Fixed-to-Floating Senior Unsecured Notes2.875-7.250 18.6% = (2,900 / 15,632) * 100

    Competitors mentioned in the company's latest 10K filing.

    • American Express - Major financial institution competitor for partners .
    • Bread Financial - Major financial institution competitor for partners .
    • Capital One - Major financial institution competitor for partners .
    • JPMorgan Chase - Major financial institution competitor for partners .
    • Citibank - Major financial institution competitor for partners .
    • TD Bank - Major financial institution competitor for partners .
    • Wells Fargo - Major financial institution competitor for partners .
    • Affirm - Non-bank provider of pay-over-time solutions .
    • Afterpay - Non-bank provider of pay-over-time solutions .
    • Klarna - Non-bank provider of pay-over-time solutions .
    • Apple - Larger technology-focused company offering financial products .
    • Google - Larger technology-focused company offering financial products .
    • Walmart - Larger retailer offering financial products .
    • Target - Larger retailer offering financial products .
    • Ally Financial - Competitor in the retail deposits business .
    • Barclays - Competitor in the retail deposits business .
    • Capital One 360 - Competitor in the retail deposits business .
    • CIT - Competitor in the retail deposits business .
    • Citi - Competitor in the retail deposits business .
    • Citizens Bank - Competitor in the retail deposits business .
    • Discover - Competitor in the retail deposits business .
    • E-Trade - Competitor in the retail deposits business .
    • Marcus by Goldman Sachs - Competitor in the retail deposits business .
    CustomerRelationshipSegmentDetails
    Lowe’s
    Multi-year private label credit card and financing solutions
    Home & Auto
    Contributed more than 10% of total interest and fees on loans for 2023.
    PayPal
    Multi-year private label credit card and financing solutions
    Digital
    Contributed more than 10% of total interest and fees on loans for 2023.
    Sam’s Club
    Multi-year private label credit card and financing solutions
    Diversified & Value
    Contributed more than 10% of total interest and fees on loans for 2023.
    NameStart DateEnd DateReason for Change
    KPMG LLP2013 PresentCurrent auditor

    Recent developments and announcements about SYF.

    Financial Reporting

      Earnings Report

      ·
      8 days ago

      Synchrony Financial (SYF) has released its Q4 2024 earnings results as of January 28, 2025. Below are the key highlights:

      Financial Performance

      • Net Earnings: $774 million, up 76% from $440 million in Q4 2023.
      • Diluted EPS: $1.91, an 85% increase from $1.03 in Q4 2023.
      • Net Interest Income: Increased by 3% to $4.6 billion, driven by higher interest and fees on loans.
      • Provision for Credit Losses: Decreased by 13% to $1.6 billion, reflecting a $100 million reserve release compared to a $402 million reserve build in the prior year.
      • Other Income: Increased by 80% to $128 million, primarily due to fees related to Product, Pricing, and Policy Changes (PPPC).
      • Efficiency Ratio: Improved to 33.3% from 36.0% in Q4 2023, reflecting lower expenses and higher revenue.

      Key Metrics

      • Loan Receivables: $104.7 billion, up 2% year-over-year.
      • Purchase Volume: Decreased by 3% to $48.0 billion.
      • Average Active Accounts: Declined by 2% to 70.3 million.
      • Net Charge-Offs: Increased to 6.45% from 5.58% in Q4 2023.

      Trends and Strategic Highlights

      • Retailer Share Arrangements: Increased by 5% to $919 million, reflecting strong program performance.
      • Platform Performance:
        • Home & Auto: Purchase volume decreased by 6% due to lower consumer traffic and credit actions.
        • Digital: Purchase volume declined by 1%, impacted by fewer active accounts.
        • Health & Wellness: Purchase volume fell by 3%, with growth in Pet and Audiology offset by declines in Dental and Vision.
        • Lifestyle: Purchase volume dropped by 5%, reflecting reduced discretionary spending.

      Capital and Liquidity

      • Deposits: Increased by $909 million to $82.1 billion, comprising 84% of funding.
      • Capital Returned: $197 million, including $100 million in share repurchases and $97 million in dividends.
      • Common Equity Tier 1 Ratio: Improved to 13.3% from 12.2% in the prior year.

      Outlook and Commentary

      • Synchrony emphasized its focus on sustainable growth and risk-adjusted returns. CEO Brian Doubles highlighted the company's ability to leverage its digital capabilities and diversified portfolio to deliver strong results.
      • CFO Brian Wenzel noted that credit actions taken in 2023 and early 2024 have positively impacted delinquency performance and positioned the company for long-term stability.

      For further details, Synchrony will host a conference call on January 28, 2025, at 8:00 a.m. ET, accessible via their Investor Relations page.