EX-99.2 3 financialtables4q16.htm EXHIBIT 99.2 Exhibit
Exhibit 99.2


SYNCHRONY FINANCIAL
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
FINANCIAL SUMMARY
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(unaudited, in millions, except per share statistics)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
 
 
Twelve Months Ended
 
 
 
 
Dec 31,
2016
 
Sep 30,
2016
 
Jun 30,
2016
 
Mar 31,
2016
 
Dec 31,
2015
 
4Q'16 vs. 4Q'15
 
Dec 31,
2016
 
Dec 31,
2015
 
YTD'16 vs. YTD'15
EARNINGS
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net interest income
$
3,628

 
$
3,481

 
$
3,212

 
$
3,209

 
$
3,208

 
$
420

13.1
 %
 
$
13,530

 
$
12,093

 
$
1,437

11.9
 %
Retailer share arrangements
(811
)
 
(757
)
 
(664
)
 
(670
)
 
(734
)
 
(77
)
10.5
 %
 
(2,902
)
 
(2,738
)
 
(164
)
6.0
 %
Net interest income, after retailer share arrangements
2,817

 
2,724

 
2,548

 
2,539

 
2,474

 
343

13.9
 %
 
10,628

 
9,355

 
1,273

13.6
 %
Provision for loan losses
1,076

 
986

 
1,021

 
903

 
823

 
253

30.7
 %
 
3,986

 
2,952

 
1,034

35.0
 %
Net interest income, after retailer share arrangements and provision for loan losses
1,741

 
1,738

 
1,527

 
1,636

 
1,651

 
90

5.5
 %
 
6,642

 
6,403

 
239

3.7
 %
Other income
85

 
84

 
83

 
92

 
87

 
(2
)
(2.3
)%
 
344

 
392

 
(48
)
(12.2
)%
Other expense
918

 
859

 
839

 
800

 
870

 
48

5.5
 %
 
3,416

 
3,264

 
152

4.7
 %
Earnings before provision for income taxes
908

 
963

 
771

 
928

 
868

 
40

4.6
 %
 
3,570

 
3,531

 
39

1.1
 %
Provision for income taxes
332

 
359

 
282

 
346

 
321

 
11

3.4
 %
 
1,319

 
1,317

 
2

0.2
 %
Net earnings
$
576

 
$
604

 
$
489

 
$
582

 
$
547

 
$
29

5.3
 %
 
$
2,251

 
$
2,214

 
$
37

1.7
 %
Net earnings attributable to common stockholders
$
576

 
$
604

 
$
489

 
$
582

 
$
547

 
$
29

5.3
 %
 
$
2,251


$
2,214


$
37

1.7
 %
 


 


 


 
 
 
 
 
 
 
 


 


 


 
COMMON SHARE STATISTICS
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic EPS
$
0.70

 
$
0.73

 
$
0.59

 
$
0.70

 
$
0.66

 
$
0.04

6.1
 %
 
$
2.71

 
$
2.66

 
$
0.05

1.9
 %
Diluted EPS
$
0.70

 
$
0.73

 
$
0.58

 
$
0.70

 
$
0.65

 
$
0.05

7.7
 %
 
$
2.71

 
$
2.65

 
$
0.06

2.3
 %
Dividend declared per share
$
0.13

 
$
0.13

 
$
—

 
$
—

 
$
—

 
$
0.13

NM

 
$
0.26

 
$
—

 
$
0.26

NM

Common stock price
$
36.27

 
$
28.00

 
$
25.28

 
$
28.66

 
$
30.41

 
$
5.86

19.3
 %
 
$
36.27

 
$
30.41

 
$
5.86

19.3
 %
Book value per share
$
17.37

 
$
16.94

 
$
16.45

 
$
15.84

 
$
15.12

 
$
2.25

14.9
 %
 
$
17.37

 
$
15.12

 
$
2.25

14.9
 %
Tangible common equity per share(1)
$
15.34

 
$
14.90

 
$
14.46

 
$
13.86

 
$
13.14

 
$
2.20

16.7
 %
 
$
15.34

 
$
13.14

 
$
2.20

16.7
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Beginning common shares outstanding
825.5

 
833.9

 
833.8

 
833.8

 
833.8

 
(8.3
)
(1.0
)%
 
833.8

 
833.8

 
—

—
 %
Issuance of common shares
—

 
—

 
—

 
—

 
—

 
—

—
 %
 
—

 
—

 
—

—
 %
Stock-based compensation
—

 
0.1

 
0.1

 
—

 
—

 
—

—

 
0.2

 
—

 
0.2

NM

Shares repurchased
(8.1
)
 
(8.5
)
 
—

 
—

 
—

 
(8.1
)
NM

 
(16.6
)
 
—

 
(16.6
)
NM

Ending common shares outstanding
817.4

 
825.5

 
833.9

 
833.8

 
833.8

 
(16.4
)
(2.0
)%
 
817.4

 
833.8

 
(16.4
)
(2.0
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted average common shares outstanding
820.5

 
828.4

 
833.9

 
833.8

 
833.8

 
(13.3
)
(1.6
)%
 
829.2

 
833.8

 
(4.6
)
(0.6
)%
Weighted average common shares outstanding (fully diluted)
823.8

 
830.6

 
836.2

 
835.5

 
835.8

 
(12.0
)
(1.4
)%
 
831.5

 
835.5

 
(4.0
)
(0.5
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(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(1)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(unaudited, $ in millions, except account data)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
 
 
 
Twelve Months Ended
 
 
 
 
Dec 31,
2016
 
Sep 30,
2016
 
Jun 30,
2016
 
Mar 31,
2016
 
Dec 31,
2015
 
4Q'16 vs. 4Q'15
 
Dec 31,
2016
 
Dec 31,
2015
 
YTD'16 vs. YTD'15
PERFORMANCE METRICS
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Return on assets(2)
2.6
%
 
2.8
%
 
2.4
%
 
2.8
%
 
2.7
%
 


(0.1
)%
 
2.7
%
 
2.9
%
 


(0.2
)%
Return on equity(3)
16.3
%
 
17.4
%
 
14.6
%
 
18.1
%
 
17.5
%
 


(1.2
)%
 
16.6
%
 
19.1
%
 


(2.5
)%
Return on tangible common equity(4)
18.5
%
 
19.8
%
 
16.6
%
 
20.8
%
 
20.1
%
 


(1.6
)%
 
18.9
%
 
22.0
%
 


(3.1
)%
Net interest margin(5)
16.22
%
 
16.27
%
 
15.86
%
 
15.76
%
 
15.73
%
 


0.49
 %
 
16.01
%
 
15.77
%
 


0.24
 %
Efficiency ratio(6)
31.6
%
 
30.6
%
 
31.9
%
 
30.4
%
 
34.0
%
 


(2.4
)%
 
31.1
%
 
33.5
%
 


(2.4
)%
Other expense as a % of average loan receivables, including held for sale
5.00
%
 
4.92
%
 
5.04
%
 
4.82
%
 
5.28
%
 


(0.28
)%
 
4.93
%
 
5.25
%
 


(0.32
)%
Effective income tax rate
36.6
%
 
37.3
%
 
36.6
%
 
37.3
%
 
37.0
%
 


(0.4
)%
 
36.9
%
 
37.3
%
 


(0.4
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
CREDIT QUALITY METRICS
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net charge-offs as a % of average loan receivables, including held for sale
4.62
%
 
4.38
%
 
4.49
%
 
4.70
%
 
4.23
%
 


0.39
 %
 
4.53
%
 
4.33
%
 


0.20
 %
30+ days past due as a % of period-end loan receivables(7)
4.32
%
 
4.26
%
 
3.79
%
 
3.85
%
 
4.06
%
 


0.26
 %
 
4.32
%
 
4.06
%
 


0.26
 %
90+ days past due as a % of period-end loan receivables(7)
2.03
%
 
1.89
%
 
1.67
%
 
1.84
%
 
1.86
%
 


0.17
 %
 
2.03
%
 
1.86
%
 


0.17
 %
Net charge-offs
$
847

 
$
765

 
$
747

 
$
780

 
$
697

 
$
150

21.5
 %
 
$
3,139

 
$
2,691

 
$
448

16.6
 %
Loan receivables delinquent over 30 days(7)
$
3,295

 
$
3,008

 
$
2,585

 
$
2,538

 
$
2,772

 
$
523

18.9
 %
 
$
3,295

 
$
2,772

 
$
523

18.9
 %
Loan receivables delinquent over 90 days(7)
$
1,546

 
$
1,334

 
$
1,143

 
$
1,212

 
$
1,273

 
$
273

21.4
 %
 
$
1,546

 
$
1,273

 
$
273

21.4
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Allowance for loan losses (period-end)
$
4,344

 
$
4,115

 
$
3,894

 
$
3,620

 
$
3,497

 
$
847

24.2
 %
 
$
4,344

 
$
3,497

 
$
847

24.2
 %
Allowance coverage ratio(8)
5.69
%
 
5.82
%
 
5.70
%
 
5.50
%
 
5.12
%
 


0.57
 %
 
5.69
%
 
5.12
%
 


0.57
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
BUSINESS METRICS
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Purchase volume(9)
$
35,369

 
$
31,615

 
$
31,507

 
$
26,977

 
$
32,460

 
$
2,909

9.0
 %
 
$
125,468

 
$
113,615

 
$
11,853

10.4
 %
Period-end loan receivables
$
76,337

 
$
70,644

 
$
68,282

 
$
65,849

 
$
68,290

 
$
8,047

11.8
 %
 
$
76,337

 
$
68,290

 
$
8,047

11.8
 %
Credit cards
$
73,580

 
$
67,858

 
$
65,511

 
$
63,309

 
$
65,773

 
$
7,807

11.9
 %
 
$
73,580

 
$
65,773

 
$
7,807

11.9
 %
Consumer installment loans
$
1,384

 
$
1,361

 
$
1,293

 
$
1,184

 
$
1,154

 
$
230

19.9
 %
 
$
1,384

 
$
1,154

 
$
230

19.9
 %
Commercial credit products
$
1,333

 
$
1,385

 
$
1,389

 
$
1,318

 
$
1,323

 
$
10

0.8
 %
 
$
1,333

 
$
1,323

 
$
10

0.8
 %
Other
$
40

 
$
40

 
$
89

 
$
38

 
$
40

 
$
—

—
 %
 
$
40

 
$
40

 
$
—

—
 %
Average loan receivables, including held for sale
$
72,987

 
$
69,525

 
$
66,943

 
$
66,705

 
$
65,406

 
$
7,581

11.6
 %
 
$
69,220

 
$
62,120

 
$
7,100

11.4
 %
Period-end active accounts (in thousands)(10)
71,890

 
66,781

 
66,491

 
64,689

 
68,314

 
3,576

5.2
 %
 
71,890

 
68,314

 
3,576

5.2
 %
Average active accounts (in thousands)(10)
68,701

 
66,639

 
65,531

 
66,134

 
64,892

 
3,809

5.9
 %
 
66,928

 
62,643

 
4,285

6.8
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
LIQUIDITY
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Liquid assets
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and equivalents
$
9,321

 
$
13,588

 
$
11,787

 
$
12,500

 
$
12,325

 
$
(3,004
)
(24.4
)%
 
$
9,321

 
$
12,325

 
$
(3,004
)
(24.4
)%
Total liquid assets
$
13,612

 
$
16,362

 
$
13,956

 
$
14,915

 
$
14,836

 
$
(1,224
)
(8.3
)%
 
$
13,612

 
$
14,836

 
$
(1,224
)
(8.3
)%
Undrawn credit facilities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Undrawn credit facilities
$
6,700

 
$
7,150

 
$
7,025

 
$
7,325

 
$
6,075

 
$
625

10.3
 %
 
$
6,700

 
$
6,075

 
$
625

10.3
 %
Total liquid assets and undrawn credit facilities
$
20,312

 
$
23,512

 
$
20,981

 
$
22,240

 
$
20,911

 
$
(599
)
(2.9
)%
 
$
20,312

 
$
20,911

 
$
(599
)
(2.9
)%
Liquid assets % of total assets
15.09
%
 
18.77
%
 
16.94
%
 
18.27
%
 
17.66
%
 


(2.57
)%
 
15.09
%
 
17.66
%
 


(2.57
)%
Liquid assets including undrawn credit facilities % of total assets
22.52
%
 
26.98
%
 
25.47
%
 
27.24
%
 
24.90
%
 


(2.38
)%
 
22.52
%
 
24.90
%
 


(2.38
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) Certain balance sheet amounts and related metrics have been updated to reflect the adoption of ASU 2015-03. More detail on this update is in footnote (1) on the Statements of Financial Position.
(2) Return on assets represents net earnings as a percentage of average total assets.
(3) Return on equity represents net earnings as a percentage of average total equity.
(4) Return on tangible common equity represents net earnings as a percentage of average tangible common equity. Tangible Common Equity ("TCE") is a non-GAAP measure. For corresponding reconciliation of TCE to a GAAP financial measure, see Reconciliation of Non-GAAP Measures and Calculations of Regulatory Measures.
(5) Net interest margin represents net interest income divided by average interest-earning assets.
(6) Efficiency ratio represents (i) other expense, divided by (ii) net interest income, after retailer share arrangements, plus other income.
(7) Based on customer statement-end balances extrapolated to the respective period-end date.
(8) Allowance coverage ratio represents allowance for loan losses divided by total period-end loan receivables.
(9) 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.
(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
 
 
 
 
Twelve Months Ended
 
 
 
 
Dec 31,
2016
 
Sep 30,
2016
 
Jun 30,
2016
 
Mar 31,
2016
 
Dec 31,
2015
 
4Q'16 vs. 4Q'15
 
Dec 31,
2016
 
Dec 31,
2015
 
YTD'16 vs. YTD'15
Interest income:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest and fees on loans
$
3,919

 
$
3,771

 
$
3,494

 
$
3,498

 
$
3,494

 
$
425

12.2
 %
 
$
14,682

 
$
13,179

 
$
1,503

11.4
 %
Interest on investment securities
28

 
25

 
21

 
22

 
15

 
13

86.7
 %
 
96

 
49

 
47

95.9
 %
Total interest income
3,947

 
3,796

 
3,515

 
3,520

 
3,509

 
438

12.5
 %
 
14,778

 
13,228

 
1,550

11.7
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest expense:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest on deposits
188

 
188

 
179

 
172

 
165

 
23

13.9
 %
 
727

 
607

 
120

19.8
 %
Interest on borrowings of consolidated securitization entities
64

 
63

 
59

 
58

 
56

 
8

14.3
 %
 
244

 
215

 
29

13.5
 %
Interest on third-party debt
67

 
64

 
65

 
81

 
80

 
(13
)
(16.3
)%
 
277

 
309

 
(32
)
(10.4
)%
Interest on related party debt
—

 
—

 
—

 
—

 
—

 
—

—
 %
 
—

 
4

 
(4
)
(100.0
)%
Total interest expense
319

 
315

 
303

 
311

 
301

 
18

6.0
 %
 
1,248

 
1,135

 
113

10.0
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net interest income
3,628

 
3,481

 
3,212

 
3,209

 
3,208

 
420

13.1
 %
 
13,530

 
12,093

 
1,437

11.9
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Retailer share arrangements
(811
)
 
(757
)
 
(664
)
 
(670
)
 
(734
)
 
(77
)
10.5
 %
 
(2,902
)
 
(2,738
)
 
(164
)
6.0
 %
Net interest income, after retailer share arrangements
2,817

 
2,724

 
2,548

 
2,539

 
2,474

 
343

13.9
 %
 
10,628

 
9,355

 
1,273

13.6
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Provision for loan losses
1,076

 
986

 
1,021

 
903

 
823

 
253

30.7
 %
 
3,986

 
2,952

 
1,034

35.0
 %
Net interest income, after retailer share arrangements and provision for loan losses
1,741

 
1,738

 
1,527

 
1,636

 
1,651

 
90

5.5
 %
 
6,642

 
6,403

 
239

3.7
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Other income:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interchange revenue
167

 
154

 
151

 
130

 
147

 
20

13.6
 %
 
602

 
505

 
97

19.2
 %
Debt cancellation fees
68

 
67

 
63

 
64

 
62

 
6

9.7
 %
 
262

 
249

 
13

5.2
 %
Loyalty programs
(157
)
 
(145
)
 
(135
)
 
(110
)
 
(125
)
 
(32
)
25.6
 %
 
(547
)
 
(419
)
 
(128
)
30.5
 %
Other
7

 
8

 
4

 
8

 
3

 
4

133.3
 %
 
27

 
57

 
(30
)
(52.6
)%
Total other income
85

 
84

 
83

 
92

 
87

 
(2
)
(2.3
)%
 
344

 
392

 
(48
)
(12.2
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Other expense:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Employee costs
315

 
311

 
301

 
280

 
285

 
30

10.5
 %
 
1,207

 
1,042

 
165

15.8
 %
Professional fees
164

 
174

 
154

 
146

 
165

 
(1
)
(0.6
)%
 
638

 
645

 
(7
)
(1.1
)%
Marketing and business development
130

 
92

 
107

 
94

 
128

 
2

1.6
 %
 
423

 
433

 
(10
)
(2.3
)%
Information processing
88

 
87

 
81

 
82

 
83

 
5

6.0
 %
 
338

 
297

 
41

13.8
 %
Other
221

 
195

 
196

 
198

 
209

 
12

5.7
 %
 
810

 
847

 
(37
)
(4.4
)%
Total other expense
918

 
859

 
839

 
800

 
870

 
48

5.5
 %
 
3,416

 
3,264

 
152

4.7
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Earnings before provision for income taxes
908

 
963

 
771

 
928

 
868

 
40

4.6
 %
 
3,570

 
3,531

 
39

1.1
 %
Provision for income taxes
332

 
359

 
282

 
346

 
321

 
11

3.4
 %
 
1,319

 
1,317

 
2

0.2
 %
Net earnings attributable to common stockholders
$
576

 
$
604

 
$
489

 
$
582

 
$
547

 
$
29

5.3
 %
 
$
2,251

 
$
2,214

 
$
37

1.7
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

3


SYNCHRONY FINANCIAL
 
 
 
 
 
 
 
 
 
 
 
 
STATEMENTS OF FINANCIAL POSITION(1)
 
 
 
 
 
 
 
 
 
 
(unaudited, $ in millions)
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
 
 
 
Dec 31,
2016
 
Sep 30,
2016
 
Jun 30,
2016
 
Mar 31,
2016
 
Dec 31,
2015
 
Dec 31, 2016 vs.
Dec 31, 2015
Assets
 
 
 
 
 
 
 
 
 
 
 
 
Cash and equivalents
$
9,321

 
$
13,588

 
$
11,787

 
$
12,500

 
$
12,325

 
$
(3,004
)
(24.4
)%
Investment securities
5,110

 
3,356

 
2,723

 
2,949

 
3,142

 
1,968

62.6
 %
Loan receivables:
 
 
 
 
 
 
 
 
 
 
 
 
Unsecuritized loans held for investment
52,332

 
47,517

 
44,854

 
41,730

 
42,826

 
9,506

22.2
 %
Restricted loans of consolidated securitization entities
24,005

 
23,127

 
23,428

 
24,119

 
25,464

 
(1,459
)
(5.7
)%
Total loan receivables
76,337

 
70,644

 
68,282

 
65,849

 
68,290

 
8,047

11.8
 %
Less: Allowance for loan losses
(4,344
)
 
(4,115
)
 
(3,894
)
 
(3,620
)
 
(3,497
)
 
(847
)
24.2
 %
Loan receivables, net
71,993

 
66,529

 
64,388

 
62,229

 
64,793

 
7,200

11.1
 %
Goodwill
949

 
949

 
949

 
949

 
949

 
—

—
 %
Intangible assets, net
712

 
733

 
704

 
702

 
701

 
11

1.6
 %
Other assets
2,122

 
2,004

 
1,833

 
2,327

 
2,080

 
42

2.0
 %
Total assets
$
90,207

 
$
87,159

 
$
82,384

 
$
81,656

 
$
83,990

 
$
6,217

7.4
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities and Equity
 
 
 
 
 
 
 
 
 
 
 
 
Deposits:
 
 
 
 
 
 
 
 
 
 
 
 
Interest-bearing deposit accounts
$
51,896

 
$
49,611

 
$
46,220

 
$
44,721

 
$
43,215

 
$
8,681

20.1
 %
Non-interest-bearing deposit accounts
159

 
204

 
207

 
256

 
152

 
7

4.6
 %
Total deposits
52,055

 
49,815

 
46,427

 
44,977

 
43,367

 
8,688

20.0
 %
Borrowings:
 
 
 
 
 
 
 
 
 
 
 
 
Borrowings of consolidated securitization entities
12,388

 
12,411

 
12,236

 
12,423

 
13,589

 
(1,201
)
(8.8
)%
Bank term loan
—

 
—

 
—

 
1,494

 
4,133

 
(4,133
)
(100.0
)%
Senior unsecured notes
7,759

 
7,756

 
7,059

 
6,559

 
6,557

 
1,202

18.3
 %
Related party debt
—

 
—

 
—

 
—

 
—

 
—

—
 %
Total borrowings
20,147

 
20,167

 
19,295

 
20,476

 
24,279

 
(4,132
)
(17.0
)%
Accrued expenses and other liabilities
3,809

 
3,196

 
2,947

 
2,999

 
3,740

 
69

1.8
 %
Total liabilities
76,011

 
73,178

 
68,669

 
68,452

 
71,386

 
4,625

6.5
 %
Equity:
 
 
 
 
 
 
 
 
 
 
 
 
Common stock
1

 
1

 
1

 
1

 
1

 
—

—
 %
Additional paid-in capital
9,393

 
9,381

 
9,370

 
9,359

 
9,351

 
42

0.4
 %
Retained earnings
5,330

 
4,861

 
4,364

 
3,875

 
3,293

 
2,037

61.9
 %
Accumulated other comprehensive income:
(53
)
 
(24
)
 
(20
)
 
(31
)
 
(41
)
 
(12
)
29.3
 %
Treasury Stock
(475
)
 
(238
)
 
—

 
—

 
—

 
(475
)
NM

Total equity
14,196

 
13,981

 
13,715

 
13,204

 
12,604

 
1,592

12.6
 %
Total liabilities and equity
$
90,207

 
$
87,159

 
$
82,384

 
$
81,656

 
$
83,990

 
$
6,217

7.4
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) In January 2016, we adopted ASU 2015-03, Interest–Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs, which requires the presentation of deferred issuance costs related to a recognized debt liability as a direct deduction from the carrying amount of the debt liability. Accordingly, we have reclassified issuance costs associated with our borrowings and certain brokered deposits, from other assets, and reflected as a reduction of borrowings and interest-bearing deposit accounts, as applicable, for each period presented to conform to the current period presentation. Related selected financial metrics included within this Financial Data Supplement have also been updated where applicable to reflect this reclassification.

4


SYNCHRONY FINANCIAL
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
AVERAGE BALANCES, NET INTEREST INCOME AND NET INTEREST MARGIN(1)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(unaudited, $ in millions)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
Dec 31, 2016
 
Sep 30, 2016
 
Jun 30, 2016
 
Mar 31, 2016
 
Dec 31, 2015
 
 
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
$
11,723

 
$
17

 
0.58
%
 
$
12,574

 
$
16

 
0.51
%
 
$
11,692

 
$
14

 
0.48
%
 
$
12,185

 
$
16

 
0.53
%
 
$
12,070

 
$
9

 
0.30
%
Securities available for sale
4,253

 
11

 
1.03
%
 
3,018

 
9

 
1.19
%
 
2,805

 
7

 
1.00
%
 
2,995

 
6

 
0.81
%
 
3,445

 
6

 
0.69
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loan receivables:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Credit cards, including held for sale
70,195

 
3,851

 
21.83
%
 
66,746

 
3,705

 
22.08
%
 
64,269

 
3,432

 
21.48
%
 
64,194

 
3,436

 
21.53
%
 
62,834

 
3,432

 
21.67
%
Consumer installment loans
1,374

 
31

 
8.98
%
 
1,331

 
31

 
9.27
%
 
1,235

 
28

 
9.12
%
 
1,159

 
27

 
9.37
%
 
1,163

 
26

 
8.87
%
Commercial credit products
1,367

 
36

 
10.48
%
 
1,390

 
35

 
10.02
%
 
1,373

 
33

 
9.67
%
 
1,313

 
35

 
10.72
%
 
1,361

 
36

 
10.49
%
Other
51

 
1

 
NM

 
58

 
—

 
—
%
 
66

 
1

 
NM

 
39

 
—

 
—
%
 
48

 
—

 
—
%
Total loan receivables, including held for sale
72,987

 
3,919

 
21.36
%
 
69,525

 
3,771

 
21.58
%
 
66,943

 
3,494

 
20.99
%
 
66,705

 
3,498

 
21.09
%
 
65,406

 
3,494

 
21.19
%
Total interest-earning assets
88,963

 
3,947

 
17.65
%
 
85,117

 
3,796

 
17.74
%
 
81,440

 
3,515

 
17.36
%
 
81,885

 
3,520

 
17.29
%
 
80,921

 
3,509

 
17.20
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Non-interest-earning assets:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and due from banks
691

 
 
 
 
 
641

 
 
 
 
 
774

 
 
 
 
 
1,277

 
 
 
 
 
1,268

 
 
 
 
Allowance for loan losses
(4,226
)
 
 
 
 
 
(3,977
)
 
 
 
 
 
(3,729
)
 
 
 
 
 
(3,583
)
 
 
 
 
 
(3,440
)
 
 
 
 
Other assets
3,394

 
 
 
 
 
3,240

 
 
 
 
 
3,209

 
 
 
 
 
3,256

 
 
 
 
 
3,133

 
 
 
 
Total non-interest-earning assets
(141
)
 
 
 
 
 
(96
)
 
 
 
 
 
254

 
 
 
 
 
950

 
 
 
 
 
961

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total assets
$
88,822

 
 
 
 
 
$
85,021

 
 
 
 
 
$
81,694

 
 
 
 
 
$
82,835

 
 
 
 
 
$
81,882

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest-bearing liabilities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest-bearing deposit accounts
$
50,901

 
$
188

 
1.47
%
 
$
47,926

 
$
188

 
1.56
%
 
$
45,490

 
$
179

 
1.58
%
 
$
44,101

 
$
172

 
1.57
%
 
$
42,079

 
$
165

 
1.56
%
Borrowings of consolidated securitization entities
12,387

 
64

 
2.06
%
 
12,369

 
63

 
2.03
%
 
12,291

 
59

 
1.93
%
 
12,950

 
58

 
1.80
%
 
13,550

 
56

 
1.64
%
Bank term loan(2)
—

 
—

 
—
%
 
—

 
—

 
—
%
 
374

 
7

 
7.53
%
 
2,565

 
24

 
3.76
%
 
4,507

 
28

 
2.46
%
Senior unsecured notes
7,758

 
67

 
3.44
%
 
7,408

 
64

 
3.44
%
 
6,809

 
58

 
3.43
%
 
6,558

 
57

 
3.50
%
 
5,810

 
52

 
3.55
%
Related party debt
—

 
—

 
—
%
 
—

 
—

 
—
%
 
—

 
—

 
—
%
 
—

 
—

 
—
%
 
—

 
—

 
—
%
Total interest-bearing liabilities
71,046

 
319

 
1.79
%
 
67,703

 
315

 
1.85
%
 
64,964

 
303

 
1.88
%
 
66,174

 
311

 
1.89
%
 
65,946

 
301

 
1.81
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Non-interest-bearing liabilities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Non-interest-bearing deposit accounts
180

 
 
 
 
 
203

 
 
 
 
 
217

 
 
 
 
 
226

 
 
 
 
 
147

 
 
 
 
Other liabilities
3,563

 
 
 
 
 
3,314

 
 
 
 
 
3,046

 
 
 
 
 
3,534

 
 
 
 
 
3,396

 
 
 
 
Total non-interest-bearing liabilities
3,743

 
 
 
 
 
3,517

 
 
 
 
 
3,263

 
 
 
 
 
3,760

 
 
 
 
 
3,543

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total liabilities
74,789

 
 
 
 
 
71,220

 
 
 
 
 
68,227

 
 
 
 
 
69,934

 
 
 
 
 
69,489

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equity
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total equity
14,033

 
 
 
 
 
13,801

 
 
 
 
 
13,467

 
 
 
 
 
12,901

 
 
 
 
 
12,393

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total liabilities and equity
$
88,822

 
 
 
 
 
$
85,021

 
 
 
 
 
$
81,694

 
 
 
 
 
$
82,835

 
 
 
 
 
$
81,882

 
 
 
 
Net interest income
 
 
$
3,628

 
 
 
 
 
$
3,481

 
 
 
 
 
$
3,212

 
 
 
 
 
$
3,209

 
 
 
 
 
$
3,208

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate spread(3)
 
 
 
 
15.86
%
 
 
 
 
 
15.89
%
 
 
 
 
 
15.48
%
 
 
 
 
 
15.40
%
 
 
 
 
 
15.39
%
Net interest margin(4)
 
 
 
 
16.22
%
 
 
 
 
 
16.27
%
 
 
 
 
 
15.86
%
 
 
 
 
 
15.76
%
 
 
 
 
 
15.73
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) Certain balance sheet amounts and related metrics have been updated to reflect the adoption of ASU 2015-03. More detail on this update is in footnote (1) on the Statements of Financial Position.
(2) Average interest rate on liabilities calculated above utilizes monthly average balances. The effective interest rates for the Bank term loan for the quarters ended June 30, 2016, March 31, 2016, and December 31, 2015 were 2.51%, 2.47%, and 2.26% respectively. The Bank term loan effective rate excludes the impact of charges incurred in connection with prepayments of the loan.
(3) Interest rate spread represents the difference between the yield on total interest-earning assets and the rate on total interest-bearing liabilities.
(4) 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(1)
 
 
 
 
 
 
(unaudited, $ in millions)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Twelve Months Ended
Dec 31, 2016
 
Twelve Months Ended
Dec 31, 2015
 
 
 
Interest
 
Average
 
 
 
Interest
 
Average
 
Average
 
Income/
 
Yield/
 
Average
 
Income/
 
Yield/
 
Balance
 
Expense
 
Rate
 
Balance
 
Expense
 
Rate
Assets
 
 
 
 
 
 
 
 
 
 
 
Interest-earning assets:
 
 
 
 
 
 
 
 
 
 
 
Interest-earning cash and equivalents
$
11,943

 
$
63

 
0.53
%
 
$
11,406

 
$
28

 
0.25
%
Securities available for sale
3,327

 
33

 
0.99
%
 
3,142

 
21

 
0.67
%
 
 
 
 
 
 
 
 
 
 
 
 
Loan receivables:
 
 
 
 
 
 
 
 
 
 
 
Credit cards, including held for sale
66,533

 
14,424

 
21.68
%
 
59,603

 
12,932

 
21.70
%
Consumer installment loans
1,274

 
117

 
9.18
%
 
1,119

 
104

 
9.29
%
Commercial credit products
1,360

 
139

 
10.22
%
 
1,359

 
142

 
10.45
%
Other
53

 
2

 
3.77
%
 
39

 
1

 
2.56
%
Total loan receivables, including held for sale
69,220

 
14,682

 
21.21
%
 
62,120

 
13,179

 
21.22
%
Total interest-earning assets
84,490

 
14,778

 
17.49
%
 
76,668

 
13,228

 
17.25
%
 
 
 
 
 
 
 
 
 
 
 
 
Non-interest-earning assets:
 
 
 
 
 
 
 
 
 
 
 
Cash and due from banks
890

 
 
 
 
 
904

 
 
 
 
Allowance for loan losses
(3,879
)
 
 
 
 
 
(3,340
)
 
 
 
 
Other assets
3,290

 
 
 
 
 
2,857

 
 
 
 
Total non-interest-earning assets
301

 
 
 
 
 
421

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total assets
$
84,791

 
 
 
 
 
$
77,089

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 
 
 
 
 
 
Interest-bearing liabilities:
 
 
 
 
 
 
 
 
 
 
 
Interest-bearing deposit accounts
$
47,163

 
$
727

 
1.54
%
 
$
38,060

 
$
607

 
1.59
%
Borrowings of consolidated securitization entities
12,532

 
244

 
1.95
%
 
13,853

 
215

 
1.55
%
Bank term loan(2)
789

 
31

 
3.93
%
 
5,357

 
136

 
2.54
%
Senior unsecured notes
7,135

 
246

 
3.45
%
 
4,949

 
173

 
3.50
%
Related party debt
—

 
—

 
—
%
 
125

 
4

 
3.20
%
Total interest-bearing liabilities
67,619

 
1,248

 
1.85
%
 
62,344

 
1,135

 
1.82
%
 
 
 
 
 
 
 
 
 
 
 
 
Non-interest-bearing liabilities
 
 
 
 
 
 
 
 
 
 
 
Non-interest-bearing deposit accounts
203

 
 
 
 
 
152

 
 
 
 
Other liabilities
3,437

 
 
 
 
 
3,015

 
 
 
 
Total non-interest-bearing liabilities
3,640

 
 
 
 
 
3,167

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total liabilities
71,259

 
 
 
 
 
65,511

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equity
 
 
 
 
 
 
 
 
 
 
 
Total equity
13,532

 
 
 
 
 
11,578

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total liabilities and equity
$
84,791

 
 
 
 
 
$
77,089

 
 
 
 
Net interest income
 
 
$
13,530

 
 
 
 
 
$
12,093

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate spread(3)
 
 
 
 
15.64
%
 
 
 
 
 
15.43
%
Net interest margin(4)
 
 
 
 
16.01
%
 
 
 
 
 
15.77
%
 
 
 
 
 
 
 
 
 
 
 
 
(1) Certain balance sheet amounts and related metrics have been updated to reflect the adoption of ASU 2015-03. More detail on this update is in footnote (1) on the Statements of Financial Position.
(2) Average interest rate on liabilities calculated above utilizes monthly average balances. The effective interest rates for the Bank term loan for the 12 months ended December 31, 2016 and December 31, 2015 were 2.48% and 2.23%, respectively. The Bank term loan effective rate excludes the impact of charges incurred in connection with prepayments of the loan.
(3) Interest rate spread represents the difference between the yield on total interest-earning assets and the rate on total interest-bearing liabilities.
(4) Net interest margin represents net interest income divided by average interest-earning assets.

6


SYNCHRONY FINANCIAL
 
 
 
 
 
 
 
 
 
 
BALANCE SHEET STATISTICS(1)
 
 
 
 
 
 
 
 
 
 
 
 
(unaudited, $ in millions, except per share statistics)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
 
 
 
Dec 31,
2016
 
Sep 30,
2016
 
Jun 30,
2016
 
Mar 31,
2016
 
Dec 31,
2015
 
Dec 31, 2016 vs.
Dec 31, 2015
BALANCE SHEET STATISTICS
 
 
 
 
 
 
 
 
 
 
 
 
Total common equity
$
14,196

 
$
13,981

 
$
13,715

 
$
13,204

 
$
12,604

 
$
1,592

12.6
%
Total common equity as a % of total assets
15.74
%
 
16.04
%
 
16.65
%
 
16.17
%
 
15.01
%
 
 
0.73
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Tangible assets
$
88,546

 
$
85,477

 
$
80,731

 
$
80,005

 
$
82,340

 
$
6,206

7.5
%
Tangible common equity(2)
$
12,535

 
$
12,299

 
$
12,062

 
$
11,553

 
$
10,954

 
$
1,581

14.4
%
Tangible common equity as a % of tangible assets(2)
14.16
%
 
14.39
%
 
14.94
%
 
14.44
%
 
13.30
%
 
 
0.86
%
Tangible common equity per share(2)
$
15.34

 
$
14.90

 
$
14.46

 
$
13.86

 
$
13.14

 
$
2.20

16.7
%
 
 
 
 
 
 
 
 
 
 
 
 
 
REGULATORY CAPITAL RATIOS(3)
 
 
 
 
 
 
 
 
 
 
 
 

Basel III Transition
 
 
 
Total risk-based capital ratio(4)
18.5
%
 
19.5
%
 
19.8
%
 
19.4
%
 
18.1
%
 
 
 
Tier 1 risk-based capital ratio(5)
17.2
%
 
18.2
%
 
18.5
%
 
18.1
%
 
16.8
%
 
 
 
Tier 1 leverage ratio(6)
15.0
%
 
15.3
%
 
15.6
%
 
14.8
%
 
14.4
%
 
 
 
Common equity Tier 1 capital ratio(7)
17.2
%
 
18.2
%
 
18.5
%
 
18.1
%
 
16.8
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

Basel III Fully Phased-in
 
 
 
Common equity Tier 1 capital ratio(7)
17.0
%
 
17.9
%
 
18.0
%
 
17.5
%
 
15.9
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) Certain balance sheet amounts and related metrics have been updated to reflect the adoption of ASU 2015-03. More detail on this update is in footnote (1) on the Statements of Financial Position.
(2) 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.
(3) Regulatory capital metrics at December 31, 2016 are preliminary and therefore subject to change.
(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.
(7) Common equity Tier 1 capital ratio is the ratio of common equity Tier 1 capital to total risk-weighted assets, each as calculated under Basel III rules. Common equity Tier 1 capital ratio (fully phased-in) is a preliminary estimate reflecting management’s interpretation of the final Basel III rules adopted in July 2013 by the Federal Reserve Board, which have not been fully implemented, and our estimate and interpretations are subject to, among other things, ongoing regulatory review and implementation guidance.

7


SYNCHRONY FINANCIAL
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
PLATFORM RESULTS
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(unaudited, $ in millions)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
 
 
 
Twelve Months Ended
 
 
 
 
Dec 31,
2016
 
Sep 30,
2016
 
Jun 30,
2016
 
Mar 31,
2016
 
Dec 31,
2015
 
4Q'16 vs. 4Q'15
 
Dec 31,
2016
 
Dec 31,
2015
 
YTD'16 vs. YTD'15
RETAIL CARD
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Purchase volume(1)(2)
$
28,996

 
$
25,285

 
$
25,411

 
$
21,550

 
$
26,768

 
$
2,228

8.3
 %
 
$
101,242

 
$
92,190

 
$
9,052

9.8
 %
Period-end loan receivables
$
52,701

 
$
48,010

 
$
46,705

 
$
45,113

 
$
47,412

 
$
5,289

11.2
 %
 
$
52,701

 
$
47,412

 
$
5,289

11.2
 %
Average loan receivables, including held for sale
$
49,897

 
$
47,420

 
$
45,861

 
$
45,900

 
$
44,958

 
$
4,939

11.0
 %
 
$
47,421

 
$
42,687

 
$
4,734

11.1
 %
Average active accounts (in thousands)(2)(3)
54,489

 
52,959

 
52,314

 
52,969

 
52,038

 
2,451

4.7
 %
 
53,344

 
50,358

 
2,986

5.9
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest and fees on loans(2)
$
2,909

 
$
2,790

 
$
2,585

 
$
2,614

 
$
2,594

 
$
315

12.1
 %
 
$
10,898

 
$
9,774

 
$
1,124

11.5
 %
Other income(2)
$
70

 
$
70

 
$
69

 
$
79

 
$
76

 
$
(6
)
(7.9
)%
 
$
288

 
$
339

 
$
(51
)
(15.0
)%
Retailer share arrangements(2)
$
(801
)
 
$
(752
)
 
$
(656
)
 
$
(661
)
 
$
(723
)
 
$
(78
)
10.8
 %
 
$
(2,870
)
 
$
(2,688
)
 
$
(182
)
6.8
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
PAYMENT SOLUTIONS
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Purchase volume(1)
$
4,194

 
$
4,152

 
$
3,903

 
$
3,392

 
$
3,714

 
$
480

12.9
 %
 
$
15,641

 
$
13,668

 
$
1,973

14.4
 %
Period-end loan receivables
$
15,567

 
$
14,798

 
$
13,997

 
$
13,420

 
$
13,543

 
$
2,024

14.9
 %
 
$
15,567

 
$
13,543

 
$
2,024

14.9
 %
Average loan receivables
$
15,146

 
$
14,391

 
$
13,644

 
$
13,482

 
$
13,192

 
$
1,954

14.8
 %
 
$
14,188

 
$
12,436

 
$
1,752

14.1
 %
Average active accounts (in thousands)(3)
8,844

 
8,461

 
8,153

 
8,134

 
7,896

 
948

12.0
 %
 
8,410

 
7,478

 
932

12.5
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest and fees on loans
$
523

 
$
505

 
$
467

 
$
457

 
$
462

 
$
61

13.2
 %
 
$
1,952

 
$
1,719

 
$
233

13.6
 %
Other income
$
3

 
$
3

 
$
3

 
$
4

 
$
3

 
$
—

—
 %
 
$
13

 
$
17

 
$
(4
)
(23.5
)%
Retailer share arrangements
$
(9
)
 
$
(3
)
 
$
(7
)
 
$
(7
)
 
$
(10
)
 
$
1

(10.0
)%
 
$
(26
)
 
$
(45
)
 
$
19

(42.2
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
CARECREDIT
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Purchase volume(1)
$
2,179

 
$
2,178

 
$
2,193

 
$
2,035

 
$
1,978

 
$
201

10.2
 %
 
$
8,585

 
$
7,757

 
$
828

10.7
 %
Period-end loan receivables
$
8,069

 
$
7,836

 
$
7,580

 
$
7,316

 
$
7,335

 
$
734

10.0
 %
 
$
8,069

 
$
7,335

 
$
734

10.0
 %
Average loan receivables
$
7,944

 
$
7,714

 
$
7,438

 
$
7,323

 
$
7,256

 
$
688

9.5
 %
 
$
7,611

 
$
6,997

 
$
614

8.8
 %
Average active accounts (in thousands)(3)
5,368

 
5,219

 
5,064

 
5,031

 
4,958

 
410

8.3
 %
 
5,174

 
4,807

 
367

7.6
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest and fees on loans
$
487

 
$
476

 
$
442

 
$
427

 
$
438

 
$
49

11.2
 %
 
$
1,832

 
$
1,686

 
$
146

8.7
 %
Other income
$
12

 
$
11

 
$
11

 
$
9

 
$
8

 
$
4

50.0
 %
 
$
43

 
$
36

 
$
7

19.4
 %
Retailer share arrangements
$
(1
)
 
$
(2
)
 
$
(1
)
 
$
(2
)
 
$
(1
)
 
$
—

—
 %
 
$
(6
)
 
$
(5
)
 
$
(1
)
20.0
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
TOTAL SYF
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Purchase volume(1)(2)
$
35,369

 
$
31,615

 
$
31,507

 
$
26,977

 
$
32,460

 
$
2,909

9.0
 %
 
$
125,468

 
$
113,615

 
$
11,853

10.4
 %
Period-end loan receivables
$
76,337

 
$
70,644

 
$
68,282

 
$
65,849

 
$
68,290

 
$
8,047

11.8
 %
 
$
76,337

 
$
68,290

 
$
8,047

11.8
 %
Average loan receivables, including held for sale
$
72,987

 
$
69,525

 
$
66,943

 
$
66,705

 
$
65,406

 
$
7,581

11.6
 %
 
$
69,220

 
$
62,120

 
$
7,100

11.4
 %
Average active accounts (in thousands)(2)(3)
68,701

 
66,639

 
65,531

 
66,134

 
64,892

 
3,809

5.9
 %
 
66,928

 
62,643

 
4,285

6.8
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest and fees on loans(2)
$
3,919

 
$
3,771

 
$
3,494

 
$
3,498

 
$
3,494

 
$
425

12.2
 %
 
$
14,682

 
$
13,179

 
$
1,503

11.4
 %
Other income(2)
$
85

 
$
84

 
$
83

 
$
92

 
$
87

 
$
(2
)
(2.3
)%
 
$
344

 
$
392

 
$
(48
)
(12.2
)%
Retailer share arrangements(2)
$
(811
)
 
$
(757
)
 
$
(664
)
 
$
(670
)
 
$
(734
)
 
$
(77
)
10.5
 %
 
$
(2,902
)
 
$
(2,738
)
 
$
(164
)
6.0
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(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)(2)
 
 
 
 
(unaudited, $ in millions, except per share statistics)
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
Dec 31,
2016
 
Sep 30,
2016
 
Jun 30,
2016
 
Mar 31,
2016
 
Dec 31,
2015
COMMON EQUITY MEASURES
 
 
 
 
 
 
 
 
 
GAAP Total common equity
$
14,196

 
$
13,981

 
$
13,715

 
$
13,204

 
$
12,604

Less: Goodwill
(949
)
 
(949
)
 
(949
)
 
(949
)
 
(949
)
Less: Intangible assets, net
(712
)
 
(733
)
 
(704
)
 
(702
)
 
(701
)
Tangible common equity
$
12,535

 
$
12,299

 
$
12,062

 
$
11,553

 
$
10,954

Adjustments for certain deferred tax liabilities and certain items in accumulated comprehensive income (loss)
337

 
299

 
282

 
281

 
280

Basel III - Common equity Tier 1 (fully phased-in)
$
12,872

 
$
12,598

 
$
12,344

 
$
11,834

 
$
11,234

Adjustment related to capital components during transition
263

 
273

 
266

 
265

 
399

Basel III - Common equity Tier 1 (transition)
$
13,135

 
$
12,871

 
$
12,610

 
$
12,099

 
$
11,633

 
 
 
 
 
 
 
 
 
 
RISK-BASED CAPITAL
 
 
 
 
 
 
 
 
 
Common equity Tier 1
$
13,135

 
$
12,871

 
$
12,610

 
$
12,099

 
$
11,633

Add: Allowance for loan losses includible in risk-based capital
994

 
923

 
890

 
869

 
898

Risk-based capital
$
14,129

 
$
13,794

 
$
13,500

 
$
12,968

 
$
12,531

 
 
 
 
 
 
 
 
 
 
ASSET MEASURES
 
 
 
 
 
 
 
 
 
Total average assets
$
88,822

 
$
85,021

 
$
81,694

 
$
82,835

 
$
81,882

Adjustments for:
 
 
 
 
 
 
 
 
 
Disallowed goodwill and other disallowed intangible assets
(net of related deferred tax liabilities) and other
(1,059
)
 
(1,117
)
 
(1,113
)
 
(1,117
)
 
(991
)
Total assets for leverage purposes
$
87,763

 
$
83,904

 
$
80,581

 
$
81,718

 
$
80,891

 
 
 
 
 
 
 
 
 
 
Risk-weighted assets - Basel III (fully phased-in)(3)
$
75,941

 
$
70,448

 
$
68,462

 
$
67,697

 
$
70,493

Risk-weighted assets - Basel III (transition)(3)
$
76,179

 
$
70,660

 
$
68,188

 
$
66,689

 
$
69,224

 
 
 
 
 
 
 
 
 
 
TANGIBLE COMMON EQUITY PER SHARE
 
 
 
 
 
 
 
 
 
GAAP book value per share
$
17.37

 
$
16.94

 
$
16.45

 
$
15.84

 
$
15.12

Less: Goodwill
(1.16
)
 
(1.14
)
 
(1.14
)
 
(1.14
)
 
(1.14
)
Less: Intangible assets, net
(0.87
)
 
(0.90
)
 
(0.85
)
 
(0.84
)
 
(0.84
)
Tangible common equity per share
$
15.34

 
$
14.90

 
$
14.46

 
$
13.86

 
$
13.14

 
 
 
 
 
 
 
 
 
 
(1) Certain balance sheet amounts and related metrics have been updated to reflect the adoption of ASU 2015-03. More detail on this update is in footnote (1) on the Statements of Financial Position.
(2) Regulatory measures at December 31, 2016 are presented on an estimated basis.
(3) Key differences between Basel III transitional rules and fully phased-in Basel III rules in the calculation of risk-weighted assets include, but not limited to, risk weighting of deferred tax assets and adjustments for certain intangible assets.
 

9