Item 1. FINANCIAL STATEMENTS

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Item 1. FINANCIAL STATEMENTS

Synchrony Financial and subsidiaries

Condensed Consolidated Statements of Earnings (Unaudited)

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	Three months ended March 31,
($ in millions, except per share data)	2025		2024
Interest income:
Interest and fees on loans (Note 5)	$	5,312	$	5,293
Interest on cash and debt securities	238		275
Total interest income	5,550		5,568
Interest expense:
Interest on deposits	882		954
Interest on borrowings of consolidated securitization entities	104		105
Interest on senior and subordinated unsecured notes	100		104

Total interest expense	1,086		1,163
Net interest income	4,464		4,405
Retailer share arrangements	(895)		(764)

Provision for credit losses (Note 5)	1,491		1,884
Net interest income, after retailer share arrangements and provision for credit losses	2,078		1,757
Other income:
Interchange revenue	238		241
Protection product revenue	147		141
Loyalty programs	(311)		(319)
Other (Note 3)	75		1,094
Total other income	149		1,157
Other expense:
Employee costs	506		496
Professional fees	217		220
Marketing and business development	116		125
Information processing	219		186
Other	185		179
Total other expense	1,243		1,206
Earnings before provision for income taxes	984		1,708
Provision for income taxes (Note 13)	227		415
Net earnings	$	757	$	1,293
Net earnings available to common stockholders	$	736	$	1,282

Earnings per share (Note 12)
Basic	$	1.91	$	3.17
Diluted	$	1.89	$	3.14

See accompanying notes to condensed consolidated financial statements.

Synchrony Financial and subsidiaries

Condensed Consolidated Statements of Comprehensive Income (Unaudited)

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	Three months ended March 31,
($ in millions)	2025		2024

Net earnings	$	757	$	1,293

Other comprehensive income (loss)
Debt securities	8		(1)
Currency translation adjustments	(1)		—
Employee benefit plans	(1)		—
Other comprehensive income (loss)	6		(1)

Comprehensive income	$	763	$	1,292

Amounts presented net of taxes.

See accompanying notes to condensed consolidated financial statements.

Synchrony Financial and subsidiaries

Condensed Consolidated Statements of Financial Position (Unaudited)

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($ in millions)	At March 31, 2025		At December 31, 2024
Assets
Cash and equivalents	$	21,629	$	14,711
Debt securities (Note 4)	2,724		3,079
Loan receivables: (Notes 5 and 6)
Unsecuritized loans held for investment	79,186		83,382
Restricted loans of consolidated securitization entities	20,422		21,339
Total loan receivables	99,608		104,721
Less: Allowance for credit losses	(10,828)		(10,929)
Loan receivables, net	88,780		93,792

Goodwill	1,274		1,274
Intangible assets, net (Note 7)	847		854
Other assets	6,772		5,753

Total assets	$	122,026	$	119,463

Liabilities and Equity
Deposits: (Note 8)
Interest-bearing deposit accounts	$	83,030	$	81,664
Non-interest-bearing deposit accounts	405		398
Total deposits	83,435		82,062
Borrowings: (Notes 6 and 9)
Borrowings of consolidated securitization entities	8,591		7,842

Senior and subordinated unsecured notes	8,418		7,620
Total borrowings	17,009		15,462
Accrued expenses and other liabilities	5,001		5,359

Total liabilities	$	105,445	$	102,883

Equity:
Preferred stock, par share value $0.001 per share; 1,250,000 and 1,250,000 shares authorized at March 31, 2025 and December 31, 2024, respectively; 1,250,000 and 1,250,000 shares issued and outstanding at March 31, 2025 and December 31, 2024, respectively, and aggregate liquidation preference of $1,250 at March 31, 2025 and $1,250 at December 31, 2024	$	1,222	$	1,222
Common Stock, par share value $0.001 per share; 4,000,000,000 shares authorized; 833,984,684 shares issued at both March 31, 2025 and December 31, 2024; 380,537,087 and 388,261,077 shares outstanding at March 31, 2025 and December 31, 2024, respectively	1		1
Additional paid-in capital	9,804		9,853
Retained earnings	22,209		21,635
Accumulated other comprehensive income (loss):
Debt securities	(15)		(23)
Currency translation adjustments	(45)		(44)
Employee benefit plans	7		8
Treasury stock, at cost; 453,447,597 and 445,723,607 shares at March 31, 2025 and December 31, 2024, respectively	(16,602)		(16,072)

Total equity	16,581		16,580
Total liabilities and equity	$	122,026	$	119,463

See accompanying notes to condensed consolidated financial statements.

Synchrony Financial and subsidiaries

Condensed Consolidated Statements of Changes in Equity (Unaudited)

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	Preferred Stock			Common Stock
($ in millions, shares in thousands)	Shares Issued	Amount		Shares Issued	Amount		Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Treasury Stock		Total Equity

Balance at January 1, 2024	750	$	734	833,985	$	1	$	9,775	$	18,662	$	(68)	$	(15,201)	$	13,903



Net earnings				—	—		—		1,293		—		—		1,293
Other comprehensive income	—	—		—	—		—		—		(1)		—		(1)
Issuance of preferred stock	500	488		—	—		—		—		—				488
Purchases of treasury stock	—	—		—	—		—		—		—		(300)		(300)
Stock-based compensation	—	—		—	—		(7)		(52)		—		71		12
Dividends - Series A preferred stock ($14.06 per share)	—	—		—	—		—		(11)		—		—		(11)
Dividends - common stock ($0.25 per share)	—	—		—	—		—		(102)		—		—		(102)

Balance at March 31, 2024	1,250	$	1,222	833,985	$	1	$	9,768	$	19,790	$	(69)	$	(15,430)	$	15,282


	Preferred Stock			Common Stock
($ in millions, shares in thousands)	Shares Issued	Amount		Shares Issued	Amount		Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Treasury Stock		Total Equity
Balance at January 1, 2025	1,250	$	1,222	833,985	$	1	$	9,853	$	21,635	$	(59)	$	(16,072)	$	16,580


Net earnings	—	—		—	—		—		757		—		—		757
Other comprehensive income	—	—		—	—		—		—		6		—		6

Purchases of treasury stock	—	—		—	—		—		—		—		(605)		(605)
Stock-based compensation	—	—		—	—		(49)		(65)		—		75		(39)
Dividends - Series A preferred stock ($14.06 per share)	—	—		—	—		—		(11)		—		—		(11)
Dividends - Series B preferred stock ($20.63 per share)	—	—		—	—		—		(10)		—		—		(10)
Dividends - common stock ($0.25 per share)	—	—		—	—		—		(97)		—		—		(97)

Balance at March 31, 2025	1,250	$	1,222	833,985	$	1	$	9,804	$	22,209	$	(53)	$	(16,602)	$	16,581

See accompanying notes to condensed consolidated financial statements.

Synchrony Financial and subsidiaries

Condensed Consolidated Statements of Cash Flows (Unaudited)

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	Three months ended March 31,
($ in millions)	2025		2024
Cash flows - operating activities
Net earnings	$	757	$	1,293
Adjustments to reconcile net earnings to cash provided from operating activities
Provision for credit losses	1,491		1,884
Deferred income taxes	54		27
Depreciation and amortization	125		119
Gain on sale of business	—		(1,069)
All other operating activities	128		155
Changes in operating assets and liabilities, net of effects of acquisitions and dispositions
(Increase) decrease in interest and fees receivable	(33)		(2)
(Increase) decrease in other assets	1		45
Increase (decrease) in accrued expenses and other liabilities	(323)		(204)
Cash provided from (used for) operating activities	2,200		2,248

Cash flows - investing activities
Maturity and sales of debt securities	855		982
Purchases of debt securities	(480)		(163)
Acquisitions, net of cash acquired	—		(1,935)
Proceeds from sale of business, net of cash and restricted cash sold	—		491

Net (increase) decrease in loan receivables, including held for sale	3,428		1,504
All other investing activities	(200)		(81)
Cash provided from (used for) investing activities	3,603		798

Cash flows - financing activities
Borrowings of consolidated securitization entities
Proceeds from issuance of securitized debt	747		747
Maturities and repayment of securitized debt	—		—
Senior and subordinated unsecured notes
Proceeds from issuance of senior and subordinated unsecured notes	796		—
Maturities and repayment of senior and subordinated unsecured notes	—		(600)


Proceeds from issuance of preferred stock	—		488
Dividends paid on preferred stock	(21)		(11)
Net increase (decrease) in deposits	1,370		2,396
Purchases of treasury stock	(605)		(300)
Dividends paid on common stock	(97)		(102)
All other financing activities	(71)		(14)
Cash provided from (used for) financing activities	2,119		2,604

Increase (decrease) in cash and equivalents, including restricted amounts	7,922		5,650
Cash and equivalents, including restricted amounts, at beginning of period	14,755		14,421
Cash and equivalents at end of period:
Cash and equivalents	21,629		20,021
Restricted cash and equivalents included in other assets	1,048		50
Total cash and equivalents, including restricted amounts, at end of period	$	22,677	$	20,071

See accompanying notes to condensed consolidated financial statements.

Synchrony Financial and subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

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NOTE 1. BUSINESS DESCRIPTION

Synchrony Financial (the “Company”) provides a range of credit products through financing programs it has established with a diverse group of national and regional retailers, local merchants, manufacturers, buying groups, industry associations and healthcare service providers. We primarily offer private label, Dual Card, co-brand and general purpose credit cards, as well as short- and long-term installment loans, and savings products insured by the Federal Deposit Insurance Corporation (“FDIC”) through Synchrony Bank (the “Bank”). We conduct our operations through a single business segment. See Note 14. Segment Reporting for additional information.

References to the “Company”, “we”, “us” and “our” are to Synchrony Financial and its consolidated subsidiaries unless the context otherwise requires.

NOTE 2. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying condensed consolidated financial statements were prepared in conformity with U.S. generally accepted accounting principles (“GAAP”).

Preparing financial statements in conformity with U.S. GAAP requires us to make estimates based on assumptions about current, and for some estimates, future, economic and market conditions (for example, unemployment, housing, interest rates and market liquidity) which affect reported amounts and related disclosures in our condensed consolidated financial statements. Although our current estimates contemplate current conditions and how we expect them to change in the future, as appropriate, it is reasonably possible that actual conditions could be different than anticipated in those estimates, which could materially affect our results of operations and financial position. Among other effects, such changes could result in incremental losses on loan receivables, future impairments of debt securities, goodwill and intangible assets, increases in reserves for contingencies, establishment of valuation allowances on deferred tax assets and increases in our tax liabilities.

We primarily conduct our business within the United States and substantially all of our revenues are from U.S. customers. The operating activities conducted by our non-U.S. affiliates use the local currency as their functional currency. The effects of translating the financial statements of these non-U.S. affiliates to U.S. dollars are included in equity. Asset and liability accounts are translated at period-end exchange rates, while revenues and expenses are translated at average rates for the respective periods.

Consolidated Basis of Presentation

The Company’s financial statements have been prepared on a consolidated basis. Under this basis of presentation, our financial statements consolidate all of our subsidiaries – i.e., entities in which we have a controlling financial interest, most often because we hold a majority voting interest. To determine if we hold a controlling financial interest in an entity, we first evaluate if we are required to apply the variable interest entity (“VIE”) model to the entity, otherwise the entity is evaluated under the voting interest model. We consolidate certain securitization entities under the VIE model because we have both power to direct and significant economics, primarily because of Synchrony or the Bank's role as servicer. See Note 6. Variable Interest Entities.

Interim Period Presentation

The condensed consolidated financial statements and notes thereto are unaudited. These statements include all adjustments (consisting of normal recurring accruals) that we considered necessary to present a fair statement of our results of operations, financial position and cash flows. The results reported in these condensed consolidated financial statements should not be considered as necessarily indicative of results that may be expected for the entire year. These condensed consolidated financial statements should be read in conjunction with our 2024 annual consolidated financial statements and the related notes in our Annual Report on Form 10-K for the year ended December 31, 2024 (our "2024 Form 10-K").

New Accounting Standards

Recently Issued But Not Yet Adopted Accounting Standards

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. This ASU requires disclosure of specific categories in the rate reconciliation, as well as additional qualitative information about the reconciliation, and additional disaggregated information about income taxes paid. The Company will adopt this guidance on a retrospective basis on its effective date, which for us is beginning within our December 31, 2025 Form 10-K. Management does not expect this guidance to have a material impact on the Consolidated Financial Statements.

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.

Allowance for Credit Losses

Changes in methodology for Allowance for Credit Losses

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.

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.

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.

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.

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.

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.

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 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. Consistent with our other assumptions, we also review segmentation to determine whether the segmentation pools remain relevant as risk characteristics change.

Charge-offs are deducted from the allowance for credit losses and are recorded in the period when we judge the principal to be uncollectible, and subsequent recoveries are added to the allowance, generally at the time cash is received on a charged-off account.

Delinquent receivables are those that are 30 days or more past due based on their contractual payments. Non-accrual loan receivables are those on which we have stopped accruing interest. We typically continue to accrue interest until the earlier of the time at which collection of an account becomes doubtful, or in the period the account becomes 180 days past due, with the exception of non-credit card accounts, for which we stop accruing interest in the period that the account becomes 90 days past due.

The same loan receivable may meet more than one of the definitions above. Accordingly, these categories are not mutually exclusive, and it is possible for a particular loan to meet the definitions of a non-accrual loan and a delinquent loan, or be modified to a borrower experiencing financial difficulty, and be included in each of these categories. The categorization of a particular loan also may not necessarily be indicative of the potential for loss.

See Note 2. Basis of Presentation and Summary of Significant Accounting Policies to our 2024 annual consolidated financial statements in our 2024 Form 10-K, for additional information on our other significant accounting policies.

NOTE 3. ACQUISITIONS AND DISPOSITIONS

Ally Lending

On March 1, 2024, we acquired Ally Financial Inc.'s point of sale financing business, ("Ally Lending") for cash consideration of $2.0 billion. This acquisition deepened our presence and reach in the home improvement and health and wellness sectors, including high-growth specialty areas such as roofing, HVAC, and windows, as well as in cosmetic, audiology, and dentistry. The acquisition primarily included loan receivables with an unpaid principal balance of $2.2 billion.

Pets Best

In March 2024, we sold our wholly-owned subsidiary, Pets Best Insurance Services, LLC (“Pets Best”) to Poodle Holdings, Inc. (“Buyer”) for consideration comprising a combination of cash and an equity interest of less than 10% in Independence Pet Holdings, Inc., ("IPH") an affiliate of Buyer. The sale of Pets Best resulted in the recognition of a gain on sale of $1.1 billion or $802 million, net of tax in the three months ended March 31, 2024. The pre-tax gain amount has been recognized within the Other component of Other Income in our Condensed Consolidated Statements of Earnings.

The Company’s initial equity investment in IPH was recorded in Other Assets on our Condensed Consolidated Statements of Financial Position and is accounted for under the equity method of accounting. The investment was recorded at its estimated fair value at the date acquired of $605 million. The change in the carrying value of our equity investment in IPH subsequent to the date acquired was not material.

See Note 3. Acquisitions and Dispositions to our 2024 annual consolidated financial statements in our 2024 Form 10-K, for additional information on both the Ally Lending and Pets Best transactions completed in the prior year.

NOTE 4. DEBT SECURITIES

All of our debt securities are classified as available-for-sale and are held to meet our liquidity objectives or to comply with the Community Reinvestment Act (“CRA”). Our debt securities consist of the following:


	March 31, 2025								December 31, 2024
			Gross		Gross						Gross		Gross
	Amortized		unrealized		unrealized		Estimated		Amortized		unrealized		unrealized		Estimated
($ in millions)	cost		gains		losses		fair value		cost		gains		losses		fair value
U.S. government and federal agency	$	1,500	$	7	$	—	$	1,507	$	1,841	$	3	$	—	$	1,844
State and municipal	16		—		—		16		17		—		(1)		16
Residential mortgage-backed(a)	326		—		(29)		297		324		—		(35)		289
Asset-backed(b)	892		4		—		896		919		4		(1)		922
Other	8		—		—		8		8		—		—		8

Total(c)	$	2,742	$	11	$	(29)	$	2,724	$	3,109	$	7	$	(37)	$	3,079

(a) All of our residential mortgage-backed securities have been issued by government-sponsored entities and are collateralized by U.S. mortgages.

(b) Our asset-backed securities are collateralized by credit card and auto loans.

(c) At March 31, 2025 and December 31, 2024, the estimated fair value of debt securities pledged by the Bank as collateral to the Federal Reserve to secure Federal Reserve discount window advances was $563 million and $551 million, respectively.

The following table presents the estimated fair values and gross unrealized losses of our available-for-sale debt securities:


	In loss position for
	Less than 12 months				12 months or more
			Gross				Gross
	Estimated		unrealized		Estimated		unrealized
($ in millions)	fair value		losses		fair value		losses
At March 31, 2025
U.S. government and federal agency	$	199	$	—	$	—	$	—
State and municipal	12		—		3		—
Residential mortgage-backed	9		—		268		(29)
Asset-backed	102		—		4		—
Other	—		—		—		—
Total(a)	$	322	$	—	$	275	$	(29)

At December 31, 2024
U.S. government and federal agency	$	199	$	—	$	—	$	—
State and municipal	12		(1)		3		—
Residential mortgage-backed	5		—		279		(35)
Asset-backed	79		(1)		4		—
Other	—		—		—		—
Total(a)	$	295	$	(2)	$	286	$	(35)

(a)Consists of 226 and 224 securities in gross unrealized loss positions at March 31, 2025 and December 31, 2024, respectively.

We regularly review debt securities for impairment resulting from credit loss using both qualitative and quantitative criteria, as necessary based on the composition of the portfolio at period end. Based on our assessment, no material impairments from credit losses were recognized during the period.

We presently do not intend to sell our debt securities that are in an unrealized loss position and believe that it is not more likely than not that we will be required to sell these securities before recovery of our amortized cost.

Contractual Maturities of Investments in Available-for-Sale Debt Securities


At March 31, 2025 ($ in millions)	Due within 1 year			Due after 1 year through 5 years			Due after 5 years through 10 years			Due after 10 years			Total

U.S. government and federal agency	$	950		$	557		$	—		$	—		$	1,507
State and municipal	—			3			3			10			16
Residential mortgage-backed	—			14			117			166			297
Asset-backed	472			424			—			—			896
Other	—			8			—			—			8
Total estimated fair value	$	1,422		$	1,006		$	120		$	176		$	2,724

Amortized cost	$	1,418		$	999		$	127		$	198		$	2,742
Weighted average yield(a)	4.8		%	4.5		%	1.8		%	2.6		%	4.4		%

(a)Weighted average yield is calculated based on the amortized cost of each security. In calculating yield, no adjustment has been made with respect to any tax-exempt obligations.

All securities are presented above based upon contractual maturity date, except our asset-backed securities which are allocated based upon expected final payment date. We expect actual maturities to differ from contractual maturities because borrowers have the right to prepay certain obligations.

There were no material realized gains or losses recognized for the three months ended March 31, 2025 and 2024.

Although we generally do not have the intent to sell any specific securities held at March 31, 2025, in the ordinary course of managing our debt securities portfolio, we may sell securities prior to their maturities for a variety of reasons, including diversification, credit quality, yield, liquidity requirements and funding obligations.

NOTE 5. LOAN RECEIVABLES AND ALLOWANCE FOR CREDIT LOSSES


($ in millions)	March 31, 2025		December 31, 2024
Credit cards	$	91,909	$	96,818
Consumer installment loans	5,736		5,971
Commercial credit products	1,859		1,826
Other	104		106
Total loan receivables, before allowance for credit losses(a)(b)(c)	$	99,608	$	104,721

(a)Total loan receivables include $20.4 billion and $21.3 billion of restricted loans of consolidated securitization entities at March 31, 2025 and December 31, 2024, respectively. See Note 6. Variable Interest Entities for further information.

(b)At March 31, 2025 and December 31, 2024, loan receivables included deferred costs, net of purchase discounts and deferred income of $(189) million and $(212) million, respectively.

(c)At March 31, 2025 and December 31, 2024, $20.5 billion and $20.7 billion, respectively, of loan receivables were pledged by the Bank as collateral to the Federal Reserve to secure Federal Reserve discount window advances.

Allowance for Credit Losses**(a)**


($ in millions)	Balance at January 1, 2025		Provision charged to operations(b)		Gross charge-offs		Recoveries		Other		Balance at March 31, 2025
Credit cards	$	10,259	$	1,336	$	(1,822)	$	360	$	—	$	10,133
Consumer installment loans	542		135		(110)		17		—		584
Commercial credit products	127		16		(35)		2		—		110
Other	1		—		—		—		—		1
Total	$	10,929	$	1,487	$	(1,967)	$	379	$	—	$	10,828


($ in millions)	Balance at January 1, 2024		Provision charged to operations(b)		Gross charge-offs		Recoveries		Other(c)		Balance at March 31, 2024
Credit cards	$	10,156	$	1,508	$	(1,761)	$	291	$	—	$	10,194
Consumer installment loans	279		345		(90)		8		39		581
Commercial credit products	131		29		(35)		2		—		127
Other	5		(2)		—		—		—		3
Total	$	10,571	$	1,880	$	(1,886)	$	301	$	39	$	10,905

(a)Excluded from the table above are allowance for credit losses for loan receivables acquired and immediately written off within the period presented.

(b)Provision for credit losses in our Condensed Consolidated Statements of Earnings also includes amounts associated with off-balance sheet credit exposures recorded in Accrued expenses and other liabilities in the Condensed Consolidated Statements of Financial Position.

(c)Primarily represents allowance for credit losses for purchased credit deteriorated assets.

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 the adoption of CECL. Beyond the reasonable and supportable forecast period, we revert to historical loss information at the loan receivables segment level over a 6-month period, and utilize historical loss information thereafter for the remaining life of the portfolio.

Losses on loan receivables, including those which are modified for borrowers experiencing financial difficulty, are estimated and recognized upon origination of the loan, based on expected credit losses for the life of the loan balance at March 31, 2025. Expected credit loss estimates are developed using both quantitative models and qualitative adjustments, and incorporates a macroeconomic forecast. The current and forecasted economic conditions at the balance sheet date are reflected in our current estimate of expected credit losses, which includes consideration of 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. Our allowance for credit losses decreased to $10.8 billion during the three months ended March 31, 2025, primarily reflecting these conditions. See Note 2. Basis of Presentation and Summary of Significant Accounting Policies for additional information on our significant accounting policies related to our allowance for credit losses at March 31, 2025, and Note 2. Basis of Presentation and Summary of Significant Accounting Policies to our 2024 annual consolidated financial statements within our 2024 Form 10-K, for additional information on our significant accounting policies related to our allowance for credit losses at December 31, 2024.

Delinquent and Non-accrual Loans

The following table provides information on our delinquent and non-accrual loans:


At March 31, 2025 ($ in millions)	30-89 days delinquent			90 or more days delinquent			Total past due			90 or more days delinquent and accruing			Total non-accruing
Credit cards	$	2,051		$	2,210		$	4,261		$	2,210		$	—
Consumer installment loans	121			32			153			—			32
Commercial credit products	48			43			91			43			—

Total delinquent loans	$	2,220		$	2,285		$	4,505		$	2,253		$	32
Percentage of total loan receivables	2.2		%	2.3		%	4.5		%	2.3		%	—		%


At December 31, 2024 ($ in millions)	30-89 days delinquent			90 or more days delinquent			Total past due			90 or more days delinquent and accruing			Total non-accruing
Credit cards	$	2,229		$	2,431		$	4,660		$	2,431		$	—
Consumer installment loans	139			39			178			—			39
Commercial credit products	45			42			87			42			—

Total delinquent loans	$	2,413		$	2,512		$	4,925		$	2,473		$	39
Percentage of total loan receivables	2.3		%	2.4		%	4.7		%	2.4		%	—		%

Credit Quality Indicators

Our loan receivables portfolio includes both secured and unsecured loans. Secured loan receivables are largely comprised of consumer installment loans secured by equipment. Unsecured loan receivables are largely comprised of our open-ended consumer and commercial revolving credit card loans. As part of our credit risk management activities, on an ongoing basis, we assess overall credit quality by reviewing information related to the performance of a customer’s account with us, including delinquency information, as well as information from credit bureaus relating to the customer’s broader credit performance. We utilize VantageScore credit data and scores to assist in our assessment of credit quality. VantageScore credit data and scores are obtained at origination of the account and are refreshed, at a minimum quarterly, but could be as often as weekly, to assist in predicting customer behavior. We categorize these credit scores into the following three credit score categories: (i) 651 or higher, which are considered the strongest credits; (ii) 591 to 650, considered moderate credit risk; and (iii) 590 or less, which are considered weaker credits. There are certain customer accounts, including for our commercial credit products, for which a VantageScore credit score may not be available where we use alternative sources to assess their credit quality and predict behavior. The following table provides the most recent VantageScore credit scores, or equivalent, available for our revolving credit card and commercial credit product customers at March 31, 2025, December 31, 2024 and March 31, 2024, respectively, as a percentage of each class of loan receivable. The table below excludes 0.3% of our total loan receivables balance for our credit cards and commercial credit products at each of March 31, 2025, December 31, 2024 and March 31, 2024, which represents those customer accounts for which a VantageScore credit score, or equivalent, is not available.


	March 31, 2025						December 31, 2024						March 31, 2024
	651 or		591 to		590 or		651 or		591 to		590 or		651 or		591 to		590 or
	higher		650		less		higher		650		less		higher		650		less
Credit cards	72	%	19	%	9	%	73	%	19	%	8	%	71	%	20	%	9	%

Commercial credit products	83	%	11	%	6	%	83	%	7	%	10	%	86	%	7	%	7	%

Consumer Installment Loans

Delinquency trends are the primary credit quality indicator for our consumer installment loans, which we use to monitor credit quality and risk within the portfolio. The tables below include information on our consumer installment loans by origination year.

Consumer Installment Loans by Origination Year


	By origination year
At March 31, 2025 ($ in millions)	2025		2024		2023		2022		2021		Prior		Total
Amortized cost basis	$	527	$	2,251	$	1,555	$	879	$	364	$	160	$	5,736
30-89 days delinquent	$	9	$	45	$	38	$	17	$	7	$	5	$	121
90 or more days delinquent	$	2	$	14	$	11	$	3	$	1	$	1	$	32


	By origination year
At December 31, 2024 ($ in millions)	2024		2023		2022		2021		2020		Prior		Total
Amortized cost basis	$	2,581	$	1,761	$	1,005	$	424	$	166	$	34	$	5,971
30-89 days delinquent	$	47	$	44	$	30	$	12	$	5	$	1	$	139
90 or more days delinquent	$	13	$	13	$	9	$	3	$	1	$	—	$	39

Gross Charge-offs for Consumer Installment Loans by Origination Year


	By origination year
For the three months ended ($ in millions)	2025		2024		2023		2022		2021		Prior		Total
March 31, 2025	$	—	$	37	$	37	$	25	$	8	$	3	$	110
March 31, 2024	$	—	$	—	$	47	$	25	$	12	$	6	$	90

Loan Modifications to Borrowers Experiencing Financial Difficulty

The following table provides information on our loan modifications made to borrowers experiencing financial difficulty during the periods presented, which do not include loans that are classified as loan receivables held for sale:


Three months ended March 31	2025				2024
($ in millions)	Amount(a)		% of Total Class of Loan Receivables			Amount		% of Total Class of Loan Receivables
Long-term modifications
Credit cards	$	439	0.5	%		$	471	0.5	%
Consumer installment loans	—		—	%		—		—	%
Commercial credit products	3		0.2	%		2		0.1	%
Short-term modifications
Credit cards	255		0.3	%		247		0.3	%
Consumer installment loans	—		—	%		—		—	%
Commercial credit products	1		—	%		—		—	%
Total	$	698	0.7	%		$	720	0.7	%

(a)Represents balance at enrollment date. Long-term and short-term loan modifications made to borrowers for the three months ended March 31, 2025 had amortized cost balances at March 31, 2025 of $424 million and $153 million, respectively.

Financial Effects of Loan Modifications to Borrowers Experiencing Financial Difficulty

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. For long-term modifications made in the three months ended March 31, 2025 and 2024, the financial effect of these modifications reduced the weighted-average interest rates by 97% for all periods presented. For short-term modifications made in the three months ended March 31, 2025 and 2024, unpaid balances of $15 million for both periods, respectively, were forgiven related to borrowers who successfully exited the program. Additionally, beginning in late 2024, for borrowers that newly enroll in our short-term loan modification programs, we no longer charge interest and penalty

fees during the term of the program and also typically waive accrued and unpaid interest and fees at the time of enrollment.

Performance of Loans Modified to Borrowers Experiencing Financial Difficulty

The following tables provide information on the performance of loans modified to borrowers experiencing financial difficulty which have been modified within the previous 12 months from the applicable balance sheet date and remained in a modification program at March 31, 2025 and 2024, respectively:


	Amortized cost basis
At March 31, 2025 ($ in millions)	Current			30-89 days delinquent			90 or more days delinquent			Total past due(a)
Long-term modifications
Credit cards	$	997		$	163		$	131		$	294
Consumer installment loans	—			—			—			—
Commercial credit products	4			1			1			2
Short-term modifications
Credit cards	65			40			48			88
Consumer installment loans	—			—			—			—
Commercial credit products	—			—			—			—

Total delinquent modified loans	$	1,066		$	204		$	180		$	384
Percentage of total loan receivables	1.1		%	0.2		%	0.2		%	0.4		%


	Amortized cost basis
At March 31, 2024 ($ in millions)	Current			30-89 days delinquent			90 or more days delinquent			Total past due(a)
Long-term modifications
Credit cards	$	928		$	175		$	151		$	326
Consumer installment loans	—			—			—			—
Commercial credit products	2			1			1			2
Short-term modifications
Credit cards	71			41			50			91
Consumer installment loans	—			—			—			—
Commercial credit products	—			—			—			—

Total delinquent modified loans	$	1,001		$	217		$	202		$	419
Percentage of total loan receivables	1.0		%	0.2		%	0.2		%	0.4		%

(a) Once a loan has been modified, it only returns to current status if the borrower pays the total minimum payment due or if the loan is re-aged after three consecutive monthly program payments are received post the modification date.

Payment Defaults

The following table presents the type, number and amount of loans to borrowers experiencing financial difficulty that enrolled in a long-term modification program within the previous 12 months from the applicable balance sheet date, and experienced a payment default and charged-off during the period presented:


Three months ended March 31	2025			2024
($ in millions, accounts in thousands)	Accounts defaulted	Loans defaulted		Accounts defaulted	Loans defaulted
Credit cards	40	$	110	47	$	118
Consumer installment loans	—	—		—	—
Commercial credit products	—	1		—	1

Total	40	$	111	47	$	119

Of the loans modified to borrowers experiencing financial difficulty that enrolled in a short-term modification program within the previous 12 months from the applicable balance sheet date, 60% and 51% had fully completed all required payments and successfully exited the program during the three months ended March 31, 2025 and 2024, respectively.

Unfunded Lending Commitments

We manage the potential risk in credit commitments by limiting the total amount of credit, both by individual customer and in total, by monitoring the size and maturity of our portfolios and by applying the same credit standards for all of our credit products. Unused credit card lines available to our customers totaled approximately $437 billion and $433 billion at March 31, 2025 and December 31, 2024, respectively. While these amounts represented the total available unused credit card lines, we have not experienced and do not anticipate that all of our customers will access their entire available line at any given point in time.

Interest Income by Product

The following table provides additional information about our interest and fees on loans, including merchant discounts, from our loan receivables, including held for sale:


	Three months ended March 31,
($ in millions)	2025		2024
Credit cards(a)	$	5,055	$	5,096
Consumer installment loans	211		149
Commercial credit products	45		45
Other	1		3
Total(b)	$	5,312	$	5,293

(a)Interest income on credit cards that was reversed related to accrued interest receivables written off was $646 million and $592 million for the three months ended March 31, 2025 and 2024, respectively.

(b)Deferred merchant discounts to be recognized in interest income at both March 31, 2025 and December 31, 2024, was $1.7 billion and $1.8 billion, respectively, which are included in Accrued expenses and other liabilities in our Condensed Consolidated Statements of Financial Position.

NOTE 6. VARIABLE INTEREST ENTITIES

We use VIEs to securitize loan receivables and arrange public and private asset-backed financing in the ordinary course of business through Synchrony Card Issuance Trust, as well as private asset-backed financing through Synchrony Credit Card Master Note Trust and Synchrony Sales Finance Master Trust. Investors in these entities only have recourse to the assets owned by the entity and not to our general credit. We do not have implicit support arrangements with any VIE and we did not provide non-contractual support for previously transferred loan receivables to any of these VIEs in the three months ended March 31, 2025 and 2024. Our VIEs are able to accept new loan receivables and arrange new asset-backed financings, consistent with the requirements and limitations on such activities placed on the VIE by existing investors. Once an account has been designated to a VIE, the contractual arrangements we have require all existing and future loan receivables originated under such account to be transferred to the VIE. The amount of loan receivables held by our VIEs in excess of the minimum amount required under the asset-backed financing arrangements with investors may be removed by us under removal of accounts provisions. All loan receivables held by a VIE are subject to claims of third-party investors.

The loan receivables in these entities have risks and characteristics similar to our other loan receivables and were underwritten to the same standard. Accordingly, the performance of these assets has been similar to our other comparable loan receivables, and the blended performance of the pools of receivables in these entities reflects the eligibility criteria that we apply to determine which receivables are selected for transfer. Contractually, the cash flows from these loan receivables must first be used to pay third-party debt holders, as well as other expenses of the entity. Excess cash flows, if any, are available to us. The creditors of these entities have no claim on our other assets.

The table below summarizes the assets and liabilities of our consolidated securitization VIEs described above:


($ in millions)	March 31, 2025		December 31, 2024
Assets
Loan receivables, net(a)	$	18,579	$	19,439

Other assets(b)	1,053		44
Total	$	19,632	$	19,483

Liabilities
Borrowings	$	8,591	$	7,842
Other liabilities	27		27
Total	$	8,618	$	7,869

(a) Includes $1.8 billion and $1.9 billion of related allowance for credit losses resulting in gross restricted loan receivables of $20.4 billion and $21.3 billion at March 31, 2025 and December 31, 2024, respectively.

(b) Includes $1.0 billion and $40 million of segregated funds held by the VIEs at March 31, 2025 and December 31, 2024, respectively, which are classified as restricted cash and equivalents and included as a component of Other assets in our Condensed Consolidated Statements of Financial Position.

The balances presented above are net of intercompany balances and transactions that are eliminated in our condensed consolidated financial statements.

We provide servicing for all of our consolidated VIEs. Collections are required to be placed into segregated accounts owned by each VIE in amounts that meet contractually specified minimum levels. These segregated funds are invested in cash and cash equivalents and are restricted as to their use, principally to pay maturing principal and interest on debt and the related servicing fees. Collections above these minimum levels are remitted to us on a daily basis.

Income (principally, interest and fees on loans) earned by our consolidated VIEs was $1.1 billion and $1.0 billion, for the three months ended March 31, 2025 and 2024, respectively. Related expenses consisted primarily of provision for credit losses of $202 million and $165 million, for the three months ended March 31, 2025 and 2024, respectively, and interest expense of $104 million and $105 million, for the three months ended March 31, 2025 and 2024, respectively.

These amounts do not include intercompany transactions, principally fees and interest, which are eliminated in our condensed consolidated financial statements.

Non-consolidated VIEs

As part of our community reinvestment initiatives, we invest in funds that invest in affordable housing properties and receive affordable housing tax credits for these investments. We account for these investments using the proportional amortization method, where the costs of the investment are amortized in proportion to the income tax credits and other income tax benefits received. These investments are included in Other assets within our Condensed Consolidated Statements of Financial Position totaled $748 million and $776 million at March 31, 2025 and December 31, 2024, respectively, and represents our total exposure for these entities.

For the three months ended March 31, 2025 and 2024, provision for income taxes included amortization expense of $27 million and $23 million, respectively, and tax credits and other tax benefits of $33 million and $28 million, respectively, associated with investments in affordable housing properties.

Our other investments in non-consolidated VIEs, totaled $280 million and $274 million at March 31, 2025 and December 31, 2024, respectively, are included in Other assets within our Condensed Consolidated Statements of Financial Position. At March 31, 2025, the Company also had investment commitments of $189 million related to these investments.

NOTE 7. INTANGIBLE ASSETS


	March 31, 2025						December 31, 2024
($ in millions)	Gross carrying amount		Accumulated amortization		Net		Gross carrying amount		Accumulated amortization		Net
Capitalized software	$	2,441	$	(1,653)	$	788	$	2,361	$	(1,569)	$	792
Other	194		(135)		59		195		(133)		62
Total	$	2,635	$	(1,788)	$	847	$	2,556	$	(1,702)	$	854

During the three months ended March 31, 2025, we recorded additions to intangible assets subject to amortization of $79 million, primarily related to capitalized software expenditures.

Amortization expense was $86 million and $80 million for the three months ended March 31, 2025 and 2024, respectively, and is included as a component of Other expense in our Condensed Consolidated Statements of Earnings.

NOTE 8. DEPOSITS

Deposits


($ in millions)	March 31, 2025		December 31, 2024
Interest-bearing deposits:
Money market and other demand deposits	$	2,581	$	2,264
Savings	30,117		28,605
Certificates of deposit
Direct	40,930		41,055
Brokered	5,682		5,891
Brokered sweep accounts	3,720		3,849
Total interest-bearing deposits	83,030		81,664

Total non-interest-bearing deposits	405		398
Total deposits	$	83,435	$	82,062

Certificates of Deposit

At March 31, 2025, our certificates of deposit maturing for the remainder of 2025 and over the next four years and thereafter were as follows:


($ in millions)			2025						2026						2027						2028						2029						Thereafter
Certificates of deposit			$	28,553					$	11,516					$	3,100					$	1,685					$	1,173					$	585

At March 31, 2025 and December 31, 2024, direct certificates of deposit of $11.4 billion and $11.2 billion, respectively, were of denominations at or exceeding applicable FDIC insurance limits, which are generally $250,000 per depositor for each account ownership category. These amounts include partially insured certificates of deposit. At March 31, 2025 and December 31, 2024, the portion of these direct certificates of deposit estimated to be uninsured was $3.8 billion and $3.7 billion, respectively. Brokered certificates of deposit are assumed to be individual deposit balances within applicable FDIC insurance limits.

Brokered Sweep Deposits

Our broker network deposit sweeps are procured through a program arranger who channels brokerage account deposits to us. Unless extended, the contracts associated with these broker network deposit sweeps will terminate between 2025 and 2029.

NOTE 9. BORROWINGS


	March 31, 2025						December 31, 2024
($ in millions)	Maturity date	Interest Rate	Weighted average interest rate		Outstanding Amount(a)(b)		Outstanding Amount(a)(b)
Borrowings of consolidated securitization entities:
Fixed securitized borrowings	2025 - 2028	3.37% - 5.74%	4.74	%	$	5,666	$	4,917
Floating securitized borrowings	2026 - 2028	5.01% - 5.34%	5.15	%	2,925		2,925
Total borrowings of consolidated securitization entities			4.88	%	8,591		7,842

Senior unsecured notes:
Synchrony Financial senior unsecured notes:
Fixed senior unsecured notes	2025 - 2031	2.88% - 5.15%	4.19	%	4,638		4,637
Fixed to floating senior unsecured notes(c)	2030 - 2031	5.45% - 5.94%	5.68	%	1,541		745


Synchrony Bank senior unsecured notes:
Fixed senior unsecured notes	2025 - 2027	5.40% - 5.63%	5.49	%	1,497		1,497

Total senior unsecured notes			4.74	%	7,676		6,879

Subordinated unsecured notes:
Synchrony Financial subordinated unsecured notes:
Fixed subordinated unsecured notes	2033	7.25%	7.25	%	742		741
Total senior and subordinated unsecured notes			4.96	%	8,418		7,620

Total borrowings					$	17,009	$	15,462

(a)Includes unamortized debt premiums, discounts and issuance costs.

(b)The Company may redeem certain borrowings prior to their original contractual maturity dates in accordance with the optional redemption provision specified in the respective instruments

(c)Includes $800 million principal amount issued in March 2025, 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.

Debt Maturities

The following table summarizes the maturities of the principal amount of our borrowings of consolidated securitization entities and senior and subordinated unsecured notes for the remainder of 2025 and over the next four years and thereafter:


($ in millions)			2025						2026						2027						2028						2029						Thereafter
Borrowings			$	4,325					$	3,800					$	4,200					$	1,025					$	650					$	3,050

Additional Sources of Liquidity

We have undrawn committed and uncommitted capacity under certain credit facilities, primarily from private lenders under our securitization programs, subject to customary borrowing conditions, and also have access to the Federal Reserve discount window.

At both March 31, 2025 and December 31, 2024, we had:

an aggregate of $2.6 billion of undrawn capacity under our securitization financings, of which $2.1 billion was committed and $450 million was uncommitted,
an aggregate of $500 million of undrawn committed capacity under our unsecured revolving credit facility with private lenders, and
an aggregate of $11.5 billion of available borrowing capacity through the Federal Reserve discount window based on the amount and type of assets pledged.

NOTE 10. FAIR VALUE MEASUREMENTS

For a description of how we estimate fair value, see Note 2. Basis of Presentation and Summary of Significant Accounting Policies in our 2024 annual consolidated financial statements within our 2024 Form 10-K. The following tables present our assets and liabilities measured at fair value on a recurring basis.

Recurring Fair Value Measurements


At March 31, 2025 ($ in millions)	Level 1		Level 2		Level 3		Total(a)
Assets
Debt securities
U.S. government and federal agency	$	—	$	1,507	$	—	$	1,507
State and municipal	—		—		16		16
Residential mortgage-backed	—		297		—		297
Asset-backed	—		896		—		896
Other	—		—		8		8
Other(b)	14		—		5		19
Total	$	14	$	2,700	$	29	$	2,743

Liabilities
Other(c)	—		—		10		10
Total	$	—	$	—	$	10	$	10

At December 31, 2024 ($ in millions)	Level 1		Level 2		Level 3		Total(a)
Assets
Debt securities
U.S. government and federal agency	$	—	$	1,844	$	—	$	1,844
State and municipal	—		—		16		16
Residential mortgage-backed	—		289		—		289
Asset-backed	—		922		—		922
Other	—		—		8		8
Other(b)	14		—		6		20
Total	$	14	$	3,055	$	30	$	3,099

Liabilities
Other(c)	—		—		$	11	$	11

Total	$	—	$	—	$	11	$	11

(a) For the three months ended March 31, 2025 and 2024, there were no fair value measurements transferred between levels and changes in our Level 3 assets and liabilities were not material.

(b) Other is primarily comprised of equity investments measured at fair value, which are included in Other assets in our Condensed Consolidated Statements of Financial Position, as well as certain financial assets for which we have elected the fair value option which are included in Loan receivables in our Condensed Consolidated Statements of Financial Position.

(c) Other includes certain financial liabilities for which we have elected the fair value option. These liabilities are included in Accrued expenses and other liabilities in our Condensed Consolidated Statements of Financial Position.

Level 3 Fair Value Measurements

Our Level 3 recurring fair value measurements primarily relate to state and municipal and corporate debt instruments, which are valued using non-binding broker quotes or other third-party sources, and financial assets and liabilities for which we have elected the fair value option. See Note 2. Basis of Presentation and Summary of Significant Accounting Policies in our 2024 annual consolidated financial statements within our 2024 Form 10-K for a description of our process to evaluate third-party pricing servicers. Our state and municipal debt securities are classified as available-for-sale with changes in fair value included in Accumulated other comprehensive income.

Financial Assets and Financial Liabilities Carried at Other Than Fair Value


	Carrying		Corresponding fair value amount
At March 31, 2025 ($ in millions)	value		Total		Level 1		Level 2		Level 3
Financial Assets
Financial assets for which carrying values equal or approximate fair value:
Cash and equivalents(a)	$	21,629	$	21,629	$	21,629	$	—	$	—
Other assets(a)(b)	$	1,048	$	1,048	$	1,048	$	—	$	—

Financial assets carried at other than fair value:
Loan receivables, net(c)	$	88,776	$	101,901	$	—	$	—	$	101,901


Financial Liabilities(d)
Financial liabilities carried at other than fair value:
Deposits(e)	$	83,435	$	83,560	$	—	$	83,560	$	—
Borrowings of consolidated securitization entities	$	8,591	$	8,634	$	—	$	5,718	$	2,916

Senior and subordinated unsecured notes	$	8,418	$	8,338	$	—	$	8,338	$	—

	Carrying		Corresponding fair value amount
At December 31, 2024 ($ in millions)	value		Total		Level 1		Level 2		Level 3
Financial Assets
Financial assets for which carrying values equal or approximate fair value:
Cash and equivalents(a)	$	14,711	$	14,711	$	14,711	$	—	$	—
Other assets(a)(b)	$	44	$	44	$	44	$	—	$	—

Financial assets carried at other than fair value:
Loan receivables, net(c)	$	93,785	$	106,632	$	—	$	—	$	106,632


Financial Liabilities(d)
Financial liabilities carried at other than fair value:
Deposits(e)	$	82,062	$	82,256	$	—	$	82,256	$	—
Borrowings of consolidated securitization entities	$	7,842	$	7,871	$	—	$	4,950	$	2,921

Senior and subordinated unsecured notes	$	7,620	$	7,502	$	—	$	7,502	$	—

(a) For cash and equivalents and restricted cash and equivalents, carrying value approximates fair value due to the liquid nature and short maturity of these instruments.

(b) This balance relates to restricted cash and equivalents, which is included in Other assets. Excludes accrued interest receivables of $51 million and $25 million at March 31, 2025 and December 31, 2024, respectively, for which carrying value approximates fair value.

(c) Excludes financial assets for which we have elected the fair value option. Under certain retail partner program agreements, the expected sales proceeds in the event of a sale of their credit card portfolio may be limited to the amounts owed by our customers, which may be less than the fair value indicated above.

(d)Excludes accrued interest payable of $282 million and $339 million, included in Accrued expenses and other liabilities, in our Condensed Consolidated Statements of Financial Position at March 31, 2025 and December 31, 2024, respectively, for which carrying values approximate fair value.

(e)Includes demand deposits with no defined maturity.

Equity Securities Without Readily Determinable Fair Values


	Three months ended
At or for the periods ended March 31 ($ in millions)	2025		2024
Carrying value(a)	$	275	$	272
Upward adjustments(b)	—		—
Downward adjustments(b)	—		—

(a) Carrying value reflects cumulative purchases and sales in addition to upward and downward carrying value changes, and at December 31, 2024 was $270 million.

(b) Between January 1, 2018 and March 31, 2025, cumulative upward and downward carrying value adjustments for equity securities held at March 31, 2025 were $201 million and $(13) million, respectively.

NOTE 11. REGULATORY AND CAPITAL ADEQUACY

As a savings and loan holding company and a financial holding company, we are subject to regulation, supervision and examination by the Federal Reserve Board and subject to the capital requirements as prescribed by Basel III capital rules and the requirements of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The Bank is a federally chartered savings association. As such, the Bank is subject to regulation, supervision and examination by the Office of the Comptroller of the Currency of the U.S. Treasury (the “OCC”), which is its primary regulator, and by the Consumer Financial Protection Bureau (“CFPB”). In addition, the Bank, as an insured depository institution, is supervised by the FDIC.

Failure to meet minimum capital requirements can initiate certain mandatory and, possibly, additional discretionary actions by regulators that, if undertaken, could limit our business activities and have a material adverse effect on our consolidated financial statements. Under capital adequacy guidelines, we must meet specific capital guidelines that involve quantitative measures of our assets, liabilities and certain off-balance-sheet items as calculated under regulatory accounting practices. The capital amounts and classifications are also subject to qualitative judgments by the regulators about components, risk weightings and other factors.

Quantitative measures established by regulation to ensure capital adequacy require us and the Bank to maintain minimum amounts and ratios (set forth in the tables below) of Total, Tier 1 and common equity Tier 1 capital (as defined in the regulations) to risk-weighted assets (as defined), and of Tier 1 capital to average assets (as defined).

For Synchrony Financial to be a well-capitalized savings and loan holding company, the Bank must be well-capitalized and Synchrony Financial must not be subject to any written agreement, order, capital directive, or prompt corrective action directive issued by the Federal Reserve Board to meet and maintain a specific capital level for any capital measure.

The Company elected to adopt the option provided by the interim final rule issued by joint federal bank regulatory agencies, which largely delayed the effects of CECL on its regulatory capital. The effects were phased-in over a three-year period through 2024 and are now fully phased-in at March 31, 2025. Under the interim final rule, the amount of adjustments to regulatory capital deferred until the phase-in period included both the initial impact of our adoption of CECL at January 1, 2020 and 25% of subsequent changes in our allowance for credit losses during the two-year period ended December 31, 2021, collectively the “CECL regulatory capital transition adjustment”. At December 31, 2024, 25% of the CECL regulatory capital transition adjustment was deferred in our regulatory capital amounts and ratios.

At March 31, 2025 and December 31, 2024, Synchrony Financial met all applicable requirements to be deemed well-capitalized pursuant to Federal Reserve Board regulations. At March 31, 2025 and December 31, 2024, the Bank also met all applicable requirements to be deemed well-capitalized pursuant to OCC regulations and for purposes of the Federal Deposit Insurance Act. There are no conditions or events subsequent to March 31, 2025 that management believes have changed the Company's or the Bank’s capital category.

The actual capital amounts, ratios and the applicable required minimums of the Company and the Bank are as follows:

Synchrony Financial


At March 31, 2025 ($ in millions)	Actual				Minimum for capital adequacy purposes
	Amount		Ratio(a)		Amount		Ratio(b)
Total risk-based capital	$	16,798	16.5	%	$	8,130	8.0	%
Tier 1 risk-based capital	$	14,668	14.4	%	$	6,098	6.0	%
Tier 1 leverage	$	14,668	12.4	%	$	4,744	4.0	%
Common equity Tier 1 Capital	$	13,446	13.2	%	$	4,573	4.5	%


At December 31, 2024 ($ in millions)	Actual				Minimum for capital adequacy purposes
	Amount		Ratio(a)		Amount		Ratio(b)
Total risk-based capital	$	17,407	16.5	%	$	8,433	8.0	%
Tier 1 risk-based capital	$	15,239	14.5	%	$	6,325	6.0	%
Tier 1 leverage	$	15,239	12.9	%	$	4,717	4.0	%
Common equity Tier 1 Capital	$	14,017	13.3	%	$	4,744	4.5	%

Synchrony Bank


At March 31, 2025 ($ in millions)	Actual				Minimum for capital adequacy purposes				Minimum to be well-capitalized under prompt corrective action provisions
	Amount		Ratio(a)		Amount		Ratio(b)		Amount		Ratio
Total risk-based capital	$	15,627	16.2	%	$	7,736	8.0	%	$	9,671	10.0	%
Tier 1 risk-based capital	$	13,554	14.0	%	$	5,802	6.0	%	$	7,736	8.0	%
Tier 1 leverage	$	13,554	12.0	%	$	4,499	4.0	%	$	5,624	5.0	%
Common equity Tier 1 capital	$	13,554	14.0	%	$	4,352	4.5	%	$	6,286	6.5	%


At December 31, 2024 ($ in millions)	Actual				Minimum for capital adequacy purposes				Minimum to be well-capitalized under prompt corrective action provisions
	Amount		Ratio(a)		Amount		Ratio(b)		Amount		Ratio
Total risk-based capital	$	15,916	15.8	%	$	8,037	8.0	%	$	10,046	10.0	%
Tier 1 risk-based capital	$	13,805	13.7	%	$	6,027	6.0	%	$	8,037	8.0	%
Tier 1 leverage	$	13,805	12.4	%	$	4,466	4.0	%	$	5,582	5.0	%
Common equity Tier 1 capital	$	13,805	13.7	%	$	4,521	4.5	%	$	6,530	6.5	%

(a)Capital ratios are calculated based on the Basel III Standardized Approach rules. Capital amounts and ratios at December 31, 2024 in the above tables reflect the applicable CECL regulatory capital transition adjustment.

(b)At March 31, 2025 and at December 31, 2024, Synchrony Financial and the Bank also must maintain a capital conservation buffer of common equity Tier 1 capital in excess of minimum risk-based capital ratios by at least 2.5 percentage points to avoid limits on capital distributions and certain discretionary bonus payments to executive officers and similar employees.

The Bank may pay dividends on its stock, with consent or non-objection from the OCC and the Federal Reserve Board, among other things, if its regulatory capital would not thereby be reduced below the applicable regulatory capital requirements.

NOTE 12. EARNINGS PER SHARE

Basic earnings per share is computed by dividing earnings available to common stockholders by the weighted average number of common shares outstanding for the period. Diluted earnings per common share reflects the assumed conversion of all dilutive securities, which are calculated using the treasury stock method.

The following table presents the calculation of basic and diluted earnings per common share:


	Three months ended March 31,
($ in millions, except per share data)	2025		2024
Net earnings	$	757	$	1,293
Preferred stock dividends	(21)		(11)
Net earnings available to common stockholders	$	736	$	1,282

Weighted average common shares outstanding, basic	385.2		404.7
Effect of dilutive securities	4.2		3.5
Weighted average common shares outstanding, dilutive	389.4		408.2

Earnings per basic common share	$	1.91	$	3.17
Earnings per diluted common share	$	1.89	$	3.14

We have issued stock-based awards under the Synchrony Financial 2024 Long-Term Incentive Plan, along with prior incentive plans. A total of less than 1 million shares and 2 million shares for the three months ended March 31, 2025 and 2024, respectively, related to these awards, were considered anti-dilutive and therefore were excluded from the computation of diluted earnings per common share.

NOTE 13. INCOME TAXES

Unrecognized Tax Benefits


($ in millions)	March 31, 2025		December 31, 2024
Unrecognized tax benefits, excluding related interest expense and penalties(a)	$	216	$	207
Portion that, if recognized, would reduce tax expense and effective tax rate(b)	$	170	$	163

(a)Interest and penalties related to unrecognized tax benefits were not material for all periods presented.

(b)Comprised of federal unrecognized tax benefits and state and local unrecognized tax benefits net of the effects of associated U.S. federal income taxes. Excludes amounts attributable to any related valuation allowances resulting from associated increases in deferred tax assets.

We establish a liability that represents the difference between a tax position taken (or expected to be taken) on an income tax return and the amount of taxes recognized in our financial statements. The liability associated with the unrecognized tax benefits is adjusted periodically when new information becomes available. The amount of unrecognized tax benefits that is reasonably possible to be resolved in the next twelve months is expected to be $33 million, of which $26 million, if recognized, would reduce the Company's tax expense and effective tax rate.

In the current year, the Company executed a Memorandum of Understanding with the IRS to participate voluntarily in the IRS Compliance Assurance Process (“CAP”) program for the 2025 tax year, and thus the tax year is under IRS review. The IRS is also examining our 2024 tax year, and we expect the review will be completed in the current year. Additionally, we are under examination in various states going back to 2014.

We believe that there are no issues or claims that are likely to significantly impact our results of operations, financial position or cash flows. We further believe that we have made adequate provision for all income tax uncertainties that could result from such examinations.

NOTE 14. SEGMENT REPORTING

We conduct our operations through a single business segment, which derives interest and fee income earned on our credit products we offer to our customers.

There have not been any changes to the basis of segmentation or the measurement of performance as compared to the 2024 Form 10-K.

The following table presents segment information for the periods presented herein:


Three months ended March 31 ($ in millions)	2025		2024
Interest and fees on loans	$	5,312	$	5,293
Interest on cash and debt securities	238		275
Total interest income	5,550		5,568
Total interest expense	1,086		1,163
Net interest income	4,464		4,405

Retailer share arrangements	(895)		(764)

Reserve build (release)	(97)		299
Net charge-offs	1,588		1,585
Provision for credit losses	1,491		1,884

Other income:
Other income	149		88
Gain on sale of business(a)	—		1,069

Total other income	149		1,157

Other expense:
Employee costs	506		496
Professional fees	217		220
Marketing and business development	116		125
Information processing	219		186
Fraud-related operational losses	41		50
Other segment items(b)	144		129
Total other expense	1,243		1,206

Provision for income taxes	227		415

Net earnings	$	757	$	1,293

_____________

(a)Includes $1.1 billion gain on sale recognized in the three months ended March 31, 2024 related to the sale of Pets Best. See Note 3. Acquisitions and Dispositions to our 2024 annual consolidated financial statements in our 2024 Form 10-K for additional information.

(b)Represents the total amount of other expenses included in net earnings, including postage and various other corporate overhead items such as facilities costs and telephone charges.

Our segment assets represent our total assets as presented on the Condensed Consolidated Statements of Financial Position.

NOTE 15. LEGAL PROCEEDINGS AND REGULATORY MATTERS

In the normal course of business, from time to time, we have been named as a defendant in various legal proceedings, including arbitrations, class actions and other litigation, arising in connection with our business activities. Certain of the legal actions include claims for substantial compensatory and/or punitive damages, or claims for indeterminate amounts of damages. We are also involved, from time to time, in reviews, investigations and proceedings (both formal and informal) by governmental agencies regarding our business (collectively, “regulatory matters”), which could subject us to significant fines, penalties, obligations to change our business practices or other requirements resulting in increased expenses, diminished income and damage to our reputation. We contest liability and/or the amount of damages as appropriate in each pending matter. In accordance with applicable accounting guidance, we establish an accrued liability for legal and regulatory matters when those matters present loss contingencies which are both probable and reasonably estimable.

Legal proceedings and regulatory matters are subject to many uncertain factors that generally cannot be predicted with assurance, and we may be exposed to losses in excess of any amounts accrued.

For some matters, we are able to determine that an estimated loss, while not probable, is reasonably possible. For other matters, including those that have not yet progressed through discovery and/or where important factual information and legal issues are unresolved, we are unable to make such an estimate. We currently estimate that the reasonably possible losses for legal proceedings and regulatory matters, whether in excess of a related accrued liability or where there is no accrued liability, and for which we are able to estimate a possible loss, are immaterial. This represents management’s estimate of possible loss with respect to these matters and is based on currently available information. This estimate of possible loss does not represent our potential maximum loss exposure. The legal proceedings and regulatory matters underlying the estimate will change from time to time and actual results may vary significantly from current estimates.

Our estimate of reasonably possible losses involves significant judgment, given the varying stages of the proceedings, the existence of numerous yet to be resolved issues, the breadth of the claims (often spanning multiple years), unspecified damages and/or the novelty of the legal issues presented. Based on our current knowledge, we do not believe that we are a party to any pending legal proceeding or regulatory matters that would have a material adverse effect on our condensed consolidated financial condition or liquidity. However, in light of the uncertainties involved in such matters, the ultimate outcome of a particular matter could be material to our operating results for a particular period depending on, among other factors, the size of the loss or liability imposed and the level of our earnings for that period, and could adversely affect our business and reputation.

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