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 June 30,				Six months ended June 30,
($ in millions, except per share data)	2026		2025		2026		2025
Interest income:
Interest and fees on loans (Note 4)	$	5,380	$	5,328	$	10,793	$	10,640
Interest on cash and debt securities	203		258		393		496
Total interest income	5,583		5,586		11,186		11,136
Interest expense:
Interest on deposits	767		855		1,537		1,737
Interest on borrowings of consolidated securitization entities	111		104		217		208
Interest on senior and subordinated unsecured notes	97		106		189		206

Total interest expense	975		1,065		1,943		2,151
Net interest income	4,608		4,521		9,243		8,985
Retailer share arrangements	(1,027)		(992)		(2,097)		(1,887)

Provision for credit losses (Note 4)	1,201		1,146		2,536		2,637
Net interest income, after retailer share arrangements and provision for credit losses	2,380		2,383		4,610		4,461
Other income:
Interchange revenue	300		268		564		506
Protection product revenue	161		144		322		291
Loyalty programs	(436)		(360)		(797)		(671)
Other	112		66		181		141
Total other income	137		118		270		267
Other expense:
Employee costs	516		509		1,031		1,015
Professional fees	220		236		429		453
Marketing and business development	137		127		251		243
Information processing	248		215		510		434
Other	210		158		426		343
Total other expense	1,331		1,245		2,647		2,488
Earnings before provision for income taxes	1,186		1,256		2,233		2,240
Provision for income taxes (Note 13)	301		289		543		516
Net earnings	$	885	$	967	$	1,690	$	1,724
Net earnings available to common stockholders	$	864	$	946	$	1,648	$	1,682

Earnings per share (Note 11)
Basic	$	2.61	$	2.51	$	4.89	$	4.42
Diluted	$	2.59	$	2.50	$	4.85	$	4.38

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 June 30,				Six months ended June 30,
($ in millions)	2026		2025		2026		2025
Net earnings	$	885	$	967	$	1,690	$	1,724

Other comprehensive income (loss)
Debt securities	(9)		3		(15)		11
Currency translation adjustments	(5)		5		(7)		4
Employee benefit plans and other	(1)		—		(1)		(1)
Other comprehensive income (loss)	(15)		8		(23)		14

Comprehensive income	$	870	$	975	$	1,667	$	1,738

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 June 30, 2026		At December 31, 2025
Assets
Cash and equivalents	$	16,193	$	14,973
Debt securities (Note 3)	4,365		2,348
Loan receivables: (Notes 4 and 5)
Unsecuritized loans held for investment	80,367		81,408
Restricted loans of consolidated securitization entities	21,841		22,400
Total loan receivables	102,208		103,808
Less: Allowance for credit losses	(10,312)		(10,442)
Loan receivables, net	91,896		93,366

Goodwill	1,363		1,363
Intangible assets, net	152		104
Other assets (Note 6)	7,961		6,941

Total assets	$	121,930	$	119,095

Liabilities and Equity
Deposits: (Note 7)
Interest-bearing deposit accounts	$	82,376	$	80,748
Non-interest-bearing deposit accounts	430		396
Total deposits	82,806		81,144
Borrowings: (Notes 5 and 8)
Borrowings of consolidated securitization entities	8,916		8,415

Senior and subordinated unsecured notes	7,516		6,767
Total borrowings	16,432		15,182
Accrued expenses and other liabilities	5,795		6,003

Total liabilities	$	105,033	$	102,329

Equity:
Preferred stock, par value $0.001 per share; 300 million shares authorized, 1.26 million and 1.25 million shares issued and outstanding at June 30, 2026 and December 31, 2025, respectively (Note 12)	$	1,716	$	1,222
Common stock, par value $0.001 per share; 4.0 billion shares authorized; 834 million shares issued at both June 30, 2026 and December 31, 2025; 325 million and 347 million shares outstanding at June 30, 2026 and December 31, 2025, respectively	1		1
Additional paid-in capital	9,876		9,902
Retained earnings	25,968		24,598
Accumulated other comprehensive income (loss):
Debt securities	(21)		(6)
Currency translation adjustments	(57)		(50)
Employee benefit plans and other	7		8
Treasury stock, at cost; 509 million and 487 million shares at June 30, 2026 and December 31, 2025, respectively	(20,593)		(18,909)

Total equity	16,897		16,766
Total liabilities and equity	$	121,930	$	119,095

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, 2025	1,250	$	1,222	833,985	$	1	$	9,853	$	21,635	$	(59)	$	(16,072)	$	16,580



Net earnings	—	—		—	—		—		757		—		—		757
Other comprehensive income (loss)	—	—		—	—		—		—		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
Net earnings	—	—		—	—		—		967		—		—		967
Other comprehensive income (loss)	—	—		—	—		—		—		8		—		8
Purchases of treasury stock	—	—		—	—		—		—		—		(504)		(504)
Stock-based compensation	—	—		—	—		32		(5)		—		8		35
Dividends - Series A preferred stock ($14.06 per share)	—	—		—	—		—		(10)		—		—		(10)
Dividends - Series B preferred stock ($20.63 per share)	—	—		—	—		—		(11)		—		—		(11)
Dividends - common stock ($0.30 per share)	—	—		—	—		—		(114)		—		—		(114)
Balance at June 30, 2025	1,250	$	1,222	833,985	$	1	$	9,836	$	23,036	$	(45)	$	(17,098)	$	16,952


	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, 2026	1,250	$	1,222	833,985	$	1	$	9,902	$	24,598	$	(48)	$	(18,909)	$	16,766


Net earnings	—	—		—	—		—		805		—		—		805
Other comprehensive income (loss)	—	—		—	—		—		—		(8)		—		(8)

Purchases of treasury stock	—	—		—	—		—		—		—		(907)		(907)
Stock-based compensation	—	—		—	—		(58)		(68)		—		72		(54)
Dividends - Series A preferred stock ($14.06 per share)	—	—		—	—		—		(10)		—		—		(10)
Dividends - Series B preferred stock ($20.63 per share)	—	—		—	—		—		(11)		—		—		(11)
Dividends - common stock ($0.30 per share)	—	—		—	—		—		(104)		—		—		(104)

Balance at March 31, 2026	1,250	$	1,222	833,985	$	1	$	9,844	$	25,210	$	(56)	$	(19,744)	$	16,477
Net earnings	—	—		—	—		—		885		—		—		885
Other comprehensive income (loss)	—	—		—	—		—		—		(15)		—		(15)
Issuance of preferred stock	5	494		—	—		—		—		—		—		494
Purchases of treasury stock	—	—		—	—		—		—		—		(859)		(859)
Stock-based compensation	—	—		—	—		32		(6)		—		10		36
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 ($0.30 per share)	—	—		—	—		—		(100)		—		—		(100)

Balance at June 30, 2026	1,255	$	1,716	833,985	$	1	$	9,876	$	25,968	$	(71)	$	(20,593)	$	16,897

See accompanying notes to condensed consolidated financial statements.

Synchrony Financial and subsidiaries

Condensed Consolidated Statements of Cash Flows (Unaudited)

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	Six months ended June 30,
($ in millions)	2026		2025
Cash flows - operating activities
Net earnings	$	1,690	$	1,724
Adjustments to reconcile net earnings to cash provided from operating activities
Provision for credit losses	2,536		2,637
Deferred income taxes	34		31
Depreciation and amortization	288		247

All other operating activities	378		280
Changes in operating assets and liabilities, net of effects of acquisitions and dispositions
(Increase) decrease in interest and fees receivable	(238)		(65)
(Increase) decrease in other assets	37		(9)
Increase (decrease) in accrued expenses and other liabilities	(122)		(85)
Cash provided from (used for) operating activities	4,603		4,760

Cash flows - investing activities
Maturity and sales of debt securities	855		1,205
Purchases of debt securities	(2,885)		(1,006)

Acquisition of loan receivables	(809)		—


Net (increase) decrease in loan receivables, including held for sale	(436)		1,607
All other investing activities	(388)		(444)
Cash provided from (used for) investing activities	(3,663)		1,362

Cash flows - financing activities
Borrowings of consolidated securitization entities
Proceeds from issuance of securitized debt	498		1,495
Maturities and repayment of securitized debt	—		(1,000)
Senior and subordinated unsecured notes
Proceeds from issuance of senior and subordinated unsecured notes	745		794
Maturities and repayment of senior and subordinated unsecured notes	—		(750)


Dividends paid on preferred stock	(42)		(42)
Proceeds from issuance of preferred stock	494		—
Net increase (decrease) in deposits	1,659		195
Purchases of treasury stock	(1,778)		(1,109)
Dividends paid on common stock	(204)		(211)
All other financing activities	(89)		(70)
Cash provided from (used for) financing activities	1,283		(698)

Increase (decrease) in cash and equivalents, including restricted amounts	2,223		5,424
Cash and equivalents, including restricted amounts, at beginning of period	15,017		14,755
Cash and equivalents at end of period:
Cash and equivalents	16,193		19,457
Restricted cash and equivalents included in other assets	1,047		722
Total cash and equivalents, including restricted amounts, at end of period	$	17,240	$	20,179

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. Through Synchrony Bank (the “Bank”), we primarily offer private label credit cards, co-branded credit cards, comprising our Dual Card offering and general purpose co-branded credit cards, and a Synchrony-branded general purpose credit card, as well as short- and long-term installment loans, and savings products insured by the Federal Deposit Insurance Corporation (“FDIC”). 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, 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, as well as certain variable interest entities ("VIE's").

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 2025 annual consolidated financial statements and the related notes in our Annual Report on Form 10-K for the year ended December 31, 2025 (our "2025 Form 10-K").

Change in Presentation

At June 30, 2026, we changed the presentation of costs incurred to develop or acquire internal-use capitalized software, previously included in Intangible assets, to now be presented as a component of Premises and equipment, included within Other assets on our Condensed Consolidated Statement of Financial Position to better align presentation of these costs with assets that have similar characteristics. Prior period amounts of $1.2 billion, net of accumulated amortization, have been reclassified to conform with the current period presentation. See Note 6. Other Assets for additional information.

Goodwill and Intangible Assets

We do not amortize goodwill but test it at least annually for impairment at the reporting unit level pursuant to FASB Account Standards Codification ("ASC 350"), Intangibles—Goodwill and Other. A reporting unit is defined under GAAP as the operating segment, or one level below that operating segment (the component level) if discrete financial information is prepared and regularly reviewed by segment management. Our single operating segment comprises a single reporting unit, based on the level at which segment management regularly reviews and measures the business operating results.

When a portion of a reporting unit constitutes a business that is being disposed of, the amount of goodwill to be included in the carrying amount of the business classified as held for sale is based upon the relative fair values of the business to be disposed of and the portion of the reporting unit that will be retained.

Goodwill impairment risk is first assessed by performing a qualitative review of entity-specific, industry, market and general economic factors for our reporting unit. If potential goodwill impairment risk exists that indicates that it is more likely than not that the carrying value of our reporting unit exceeds its fair value, a quantitative test is performed. The quantitative test compares the reporting unit’s estimated fair value with its carrying value, including goodwill. If the carrying value of our reporting unit exceeds its fair value, an impairment loss is recognized in an amount equal to that excess, limited to the amount of goodwill allocated to the reporting unit. The qualitative assessment for each period presented in the condensed consolidated financial statements was performed without hindsight, assuming only factors and market conditions existing as of those dates, and resulted in no potential goodwill impairment risk for our reporting unit. Consequently, goodwill was not deemed to be impaired for any of the periods presented.

Definite-lived intangible assets primarily consist of customer-related assets, including purchased credit card relationships, which are amortized over their estimated useful lives. Definite-lived intangible assets are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of these assets may not be recoverable. The evaluation compares the cash inflows expected to be generated from each intangible asset to its carrying value. If cash flows attributable to the intangible asset are less than the carrying value, the asset is considered impaired and written down to its estimated fair value.

Other Assets

Other assets primarily consist of deferred income taxes, premises and equipment, which includes internal-use capitalized software, investments in affordable housing properties, equity method investments, and contract costs related to our retail partner agreements. Certain costs incurred to develop or acquire internal-use software are capitalized and amortized on a straight-line basis over their respective estimated useful life, generally five years, and the amortization is included as a component of Information processing costs in our Condensed Consolidated Statements of Earnings. We review these assets for impairment using the same impairment methodology used for definite-lived intangible assets. Retail partner contract costs are recognized over the life of the contract with the retail partner and are included as a component of Marketing and business development expense in our Condensed Consolidated Statements of Earnings.

New Accounting Standards

Recently Issued But Not Yet Adopted Accounting Standards

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 on our Consolidated Financial Statements.

In September 2025, the FASB issued ASU 2025-06, Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40). This ASU amends certain aspects of the accounting for and disclosure of software costs. This ASU requires an entity to start capitalizing software costs when both management has authorized and committed to funding the software project, and it is probable that the project will be completed and the software will be used to perform the function intended. The amendments in this update are effective for the Company beginning in January 2028, through either a prospective, modified, or retrospective transition approach, with early adoption permitted. The Company is currently evaluating the updated guidance to assess the impact and the method of adoption.

In November 2025, the FASB issued ASU 2025-08, Financial Instruments – Credit Losses (Topic 326) – Purchased Loans. This ASU expands the population of purchased financial assets subject to the gross-up approach in Topic 326. As a result of this update, loans (excluding credit cards) acquired without credit deterioration and deemed “seasoned” as defined in the ASU will follow the gross-up approach at acquisition and the initial allowance for credit losses at acquisition is added to the amortized cost basis of the loans. The Company is currently evaluating the updated guidance, which is effective prospectively beginning January 2027, with early adoption permitted.

In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270), which improves the navigability of the required interim disclosures, provides clarity as to when it is applicable, and provides additional guidance on what disclosures are required in interim reporting periods by establishing a disclosure principle. The guidance is effective for interim reporting periods beginning in 2028 and can be applied either prospectively or retrospectively. The Company is currently evaluating the updated guidance to assess the impact and determining its method of adoption.

See Note 2. Basis of Presentation and Summary of Significant Accounting Policies to our 2025 annual consolidated financial statements in our 2025 Form 10-K, for additional information on our significant accounting policies.

NOTE 3. 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:


	June 30, 2026								December 31, 2025
			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	$	3,465	$	2	$	(7)	$	3,460	$	1,485	$	7	$	—	$	1,492
State and municipal	34		—		(1)		33		35		—		—		35
Residential mortgage-backed(a)	334		—		(23)		311		318		1		(22)		297
Asset-backed(b)	551		1		—		552		509		6		—		515
Other	8		1		—		9		8		1		—		9

Total(c)	$	4,392	$	4	$	(31)	$	4,365	$	2,355	$	15	$	(22)	$	2,348

(a) 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 June 30, 2026 and December 31, 2025, 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 $288 million and $470 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 June 30, 2026
U.S. government and federal agency	$	2,178	$	(7)	$	—	$	—
State and municipal	25		(1)		5		—
Residential mortgage-backed	86		(1)		200		(22)
Asset-backed	199		—		—		—
Other	—		—		—		—
Total(a)	$	2,488	$	(9)	$	205	$	(22)

At December 31, 2025
U.S. government and federal agency	$	—	$	—	$	—	$	—
State and municipal	17		—		5		—
Residential mortgage-backed	—		—		229		(22)
Asset-backed	—		—		—		—
Other	—		—		—		—
Total(a)	$	17	$	—	$	234	$	(22)

(a)Consists of 253 and 211 securities in gross unrealized loss positions at June 30, 2026 and December 31, 2025, 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 June 30, 2026 ($ 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	$	2,228		$	1,232		$	—		$	—		$	3,460
State and municipal	—			6			—			27			33
Residential mortgage-backed	—			40			91			180			311
Asset-backed	178			374			—			—			552
Other	—			9			—			—			9
Total estimated fair value	$	2,406		$	1,661		$	91		$	207		$	4,365

Amortized cost	$	2,406		$	1,666		$	100		$	220		$	4,392
Weighted average yield(a)	4.0		%	4.0		%	1.4		%	4.2		%	3.9		%

(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 six months ended June 30, 2026 and 2025.

Although we generally do not have the intent to sell any specific securities held at June 30, 2026, 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 4. LOAN RECEIVABLES AND ALLOWANCE FOR CREDIT LOSSES


($ in millions)	June 30, 2026		December 31, 2025
Credit cards	$	94,233	$	96,346
Consumer installment loans	5,233		5,548
Commercial credit products	2,681		1,833
Other	61		81
Total loan receivables, before allowance for credit losses(a)(b)(c)	$	102,208	$	103,808

(a)Total loan receivables include $21.8 billion and $22.4 billion of restricted loans of consolidated securitization entities at June 30, 2026 and December 31, 2025, respectively. See Note 5. Variable Interest Entities for further information.

(b)At June 30, 2026 and December 31, 2025, loan receivables included deferred costs, net of purchase discounts and deferred income, of $(4) million and $(53) million, respectively.

(c)At June 30, 2026 and December 31, 2025, $19.5 billion and $18.3 billion, respectively, of loan receivables were pledged by the Bank as collateral to the Federal Reserve to secure Federal Reserve discount window advances.

Loan Receivables Acquired

In April 2026, we completed our acquisition of the Lowe's commercial co-branded credit card portfolio, comprising $0.7 billion of outstanding loan receivables. This transaction was accounted for as an asset purchase.

Allowance for Credit Losses


($ in millions)	Balance at April 1, 2026		Provision charged to operations		Gross charge-offs		Recoveries		Other(b)		Balance at June 30, 2026
Credit cards	$	9,704	$	1,142	$	(1,653)	$	417	$	—	$	9,610
Consumer installment loans	614		(27)		(110)		14		—		491
Commercial credit products	109		86		(35)		3		47		210
Other	1		—		—		—		—		1
Total	$	10,428	$	1,201	$	(1,798)	$	434	$	47	$	10,312


($ in millions)	Balance at April 1, 2025		Provision charged to operations(a)		Gross charge-offs		Recoveries		Other		Balance at June 30, 2025
Credit cards	$	10,133	$	1,077	$	(1,674)	$	370	$	—	$	9,906
Consumer installment loans	584		38		(92)		15		—		545
Commercial credit products	110		32		(33)		3		—		112
Other	1		—		—		—		—		1
Total	$	10,828	$	1,147	$	(1,799)	$	388	$	—	$	10,564



($ in millions)	Balance at January 1, 2026		Provision charged to operations(a)		Gross charge-offs		Recoveries		Other(b)		Balance at June 30, 2026
Credit cards	$	9,789	$	2,290	$	(3,295)	$	826	$	—	$	9,610
Consumer installment loans	543		127		(211)		32		—		491
Commercial credit products	109		116		(68)		6		47		210
Other	1		—		—		—		—		1
Total	$	10,442	$	2,533	$	(3,574)	$	864	$	47	$	10,312



($ in millions)	Balance at January 1, 2025		Provision charged to operations(a)		Gross charge-offs		Recoveries		Other		Balance at June 30, 2025
Credit cards	$	10,259	$	2,413	$	(3,496)	$	730	$	—	$	9,906
Consumer installment loans	542		173		(202)		32		—		545
Commercial credit products	127		48		(68)		5		—		112
Other	1		—		—		—		—		1
Total	$	10,929	$	2,634	$	(3,766)	$	767	$	—	$	10,564

(a)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 our Condensed Consolidated Statements of Financial Position.

(b)Primarily represents allowance for credit losses associated with a loan portfolio purchase completed in the period, previously recorded in Accrued expenses and other liabilities in our Condensed Consolidated Statements of Financial Position.

The reasonable and supportable forecast period used in our estimate of credit losses at June 30, 2026 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 on a straight-line basis, 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, and updated based on expected credit losses for the life of the loan balance at the period end date. 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, as well as expectations of the macroeconomic environment. Our allowance for credit losses decreased to $10.3 billion at June 30, 2026, as compared to $10.4 billion at December 31, 2025, reflecting continued asset quality trends during the six months ended June 30, 2026. See Note 2. Basis of Presentation and Summary of Significant Accounting Policies to our 2025 annual consolidated financial statements within our 2025 Form 10-K, for additional information on our significant accounting policies related to our allowance for credit losses.

Delinquent and Non-accrual Loans

The following tables provide information on our delinquent and non-accrual loan receivables:


At June 30, 2026 ($ 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	$	1,983		$	1,976		$	3,959		$	1,976		$	—
Consumer installment loans	120			29			149			—			29
Commercial credit products	96			45			141			45			—

Total delinquent loans	$	2,199		$	2,050		$	4,249		$	2,021		$	29
Percentage of total loan receivables	2.2		%	2.0		%	4.2		%	2.0		%	—		%


At December 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	$	2,223		$	2,181		$	4,404		$	2,181		$	—
Consumer installment loans	144			31			175			—			31
Commercial credit products	45			36			81			36			—

Total delinquent loans	$	2,412		$	2,248		$	4,660		$	2,217		$	31
Percentage of total loan receivables	2.3		%	2.2		%	4.5		%	2.1		%	—		%

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-end 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 consumer 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 June 30, 2026, December 31, 2025 and June 30, 2025, respectively, as a percentage of each class of loan receivables.

The table below excludes 0.4%, 0.4% and 0.3% of our total loan receivables balance for our credit cards and commercial credit products at June 30, 2026, December 31, 2025 and June 30, 2025, respectively, which represents those customer accounts for which a VantageScore credit score, or equivalent, is not available.


	June 30, 2026						December 31, 2025						June 30, 2025
	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	74	%	18	%	8	%	74	%	18	%	8	%	74	%	18	%	8	%

Commercial credit products	83	%	9	%	8	%	83	%	11	%	6	%	83	%	11	%	6	%

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 June 30, 2026 ($ in millions)	2026		2025		2024		2023		2022		Prior		Total
Amortized cost basis	$	990	$	1,503	$	1,178	$	836	$	510	$	216	$	5,233
30-89 days delinquent	$	13	$	30	$	29	$	24	$	16	$	8	$	120
90 or more days delinquent	$	3	$	8	$	7	$	5	$	4	$	2	$	29


	By origination year
At December 31, 2025 ($ in millions)	2025		2024		2023		2022		2021		Prior		Total
Amortized cost basis	$	1,959	$	1,524	$	1,091	$	655	$	241	$	78	$	5,548
30-89 days delinquent	$	37	$	37	$	35	$	23	$	9	$	3	$	144
90 or more days delinquent	$	9	$	9	$	7	$	4	$	1	$	1	$	31

Gross Charge-offs for Consumer Installment Loans by Origination Year


	By origination year
For the six months ended ($ in millions)	2026		2025		2024		2023		2022		Prior		Total
June 30, 2026	$	12	$	69	$	47	$	42	$	29	$	12	$	211
June 30, 2025	$	—	$	1	$	71	$	66	$	44	$	20	$	202

Loan Modifications to Borrowers Experiencing Financial Difficulty

The following tables provide 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 June 30	2026				2025
($ in millions)	Amount(a)		% of Total Class of Loan Receivables			Amount		% of Total Class of Loan Receivables
Long-term modifications
Credit cards	$	341	0.4	%		$	383	0.4	%
Consumer installment loans	—		—	%		—		—	%
Commercial credit products	4		0.1	%		2		0.1	%
Short-term modifications
Credit cards	196		0.2	%		206		0.2	%
Consumer installment loans	—		—	%		—		—	%
Commercial credit products	—		—	%		—		—	%
Total	$	541	0.5	%		$	591	0.6	%



Six months ended June 30	2026				2025
($ in millions)	Amount(a)		% of Total Class of Loan Receivables			Amount		% of Total Class of Loan Receivables
Long-term modifications
Credit cards	$	739	0.8	%		$	822	0.9	%
Consumer installment loans	—		—	%		—		—	%
Commercial credit products	6		0.2	%		5		0.3	%
Short-term modifications
Credit cards	414		0.4	%		461		0.5	%
Consumer installment loans	—		—	%		—		—	%
Commercial credit products	1		—	%		1		—	%
Total	$	1,160	1.1	%		$	1,289	1.3	%

(a)Represents balance at enrollment date. Long-term and short-term loan modifications made to borrowers for the six months ended June 30, 2026 had amortized cost balances at June 30, 2026 of $661 million and $117 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 and six months ended June 30, 2026 and 2025, 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 June 30, 2026 and 2025, unpaid balances of $11 million and $13 million, respectively, were forgiven related to borrowers who successfully exited the program. For short-term modifications made in the six months ended June 30, 2026 and 2025, unpaid balances of $105 million and $118 million, respectively, were forgiven related to borrowers who successfully exited the program.

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 June 30, 2026 and 2025, respectively:


	Amortized cost basis
At June 30, 2026 ($ in millions)	Current			30-89 days delinquent			90 or more days delinquent			Total past due(a)
Long-term modifications
Credit cards	$	915		$	127		$	100		$	227
Consumer installment loans	—			—			—			—
Commercial credit products	6			1			1			2
Short-term modifications
Credit cards	56			29			32			61
Consumer installment loans	—			—			—			—
Commercial credit products	—			—			—			—

Total loans modified	$	977		$	157		$	133		$	290
Percentage of total loan receivables	1.0		%	0.2		%	0.1		%	0.3		%


	Amortized cost basis
At June 30, 2025 ($ in millions)	Current			30-89 days delinquent			90 or more days delinquent			Total past due(a)
Long-term modifications
Credit cards	$	997		$	148		$	117		$	265
Consumer installment loans	—			—			—			—
Commercial credit products	4			1			1			2
Short-term modifications
Credit cards	56			30			38			68
Consumer installment loans	—			—			—			—
Commercial credit products	—			—			—			—

Total loans modified	$	1,057		$	179		$	156		$	335
Percentage of total loan receivables	1.1		%	0.2		%	0.2		%	0.3		%

(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 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 June 30,				Six months ended June 30,
($ in millions)	2026		2025		2026		2025
Credit cards	$	88	$	103	$	166	$	190
Consumer installment loans	—		—		—		—
Commercial credit products	1		1		1		1

Total	$	89	$	104	$	167	$	191

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, 62% and 63% had fully completed all required payments and successfully exited the program during the six months ended June 30, 2026 and 2025, 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 a consistent underwriting approach for all of our credit products. Unused credit card lines available to our customers totaled approximately $453 billion and $440 billion at June 30, 2026 and December 31, 2025, 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 June 30,				Six months ended June 30,
($ in millions)	2026		2025		2026		2025
Credit cards(a)	$	5,092	$	5,076	$	10,244	$	10,131
Consumer installment loans	187		207		375		418
Commercial credit products	100		43		172		88
Other	1		2		2		3
Total(b)	$	5,380	$	5,328	$	10,793	$	10,640

(a)Interest income on credit cards that was reversed related to accrued interest receivables written off was $609 million and $578 million for the three months ended June 30, 2026 and 2025, respectively, and $1.2 billion for both the six months ended June 30, 2026 and 2025.

(b)Deferred merchant discounts to be recognized in interest income at June 30, 2026 and December 31, 2025, were $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 5. 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 and six months ended June 30, 2026 and 2025. 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)	June 30, 2026		December 31, 2025
Assets
Loan receivables, net(a)	$	19,884	$	20,457

Other assets(b)	1,050		46
Total	$	20,934	$	20,503

Liabilities
Borrowings	$	8,916	$	8,415
Other liabilities	27		28
Total	$	8,943	$	8,443

(a) Includes $2.0 billion and $1.9 billion of related allowance for credit losses resulting in gross restricted loan receivables of $21.8 billion and $22.4 billion at June 30, 2026 and December 31, 2025, respectively.

(b) Includes $1.0 billion and $42 million of segregated funds held by the VIEs at June 30, 2026 and December 31, 2025, 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, including amounts related to servicing of the loan receivables held by our VIEs.

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.

The table below summarizes selected financial metrics of our consolidated securitization VIEs described above:


	Three months ended June 30,				Six months ended June 30,
($ in millions)	2026		2025		2026		2025
Interest and fees on loans	$	1,144	$	1,067	2,269		$	2,117
Provision for credit losses	$	220	$	260	$	461	$	462
Interest expense	$	111	$	104	$	217	$	208

These amounts do not include intercompany transactions, 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 and totaled $904 million and $943 million at June 30, 2026 and December 31, 2025, respectively. At June 30, 2026, we are committed to provide funding related to these investments of $456 million, which is expected to be paid between 2026 and 2042, and is reported within Accrued expenses and other liabilities within our Condensed Consolidated Statements of Financial Position.

The table below summarizes amortization expense and tax credits and other tax benefits associated with investments in affordable housing properties included in Provision for income taxes in our Condensed Consolidated Statements of Earnings:


	Three months ended June 30,				Six months ended June 30,
($ in millions)	2026		2025		2026		2025
Amortization expense	$	39	$	46	$	79	$	73
Tax credits and other benefits	$	(48)	$	(55)	$	(97)	$	(88)

Our other investments in non-consolidated VIEs totaled $312 million and $301 million at June 30, 2026 and December 31, 2025, respectively, and are included in Other assets within our Condensed Consolidated Statements of Financial Position. At June 30, 2026, the Company also had investment commitments of $196 million related to these investments. We may be required to fund these commitments between 2026 and 2046.

NOTE 6. OTHER ASSETS


	June 30, 2026		December 31, 2025
Deferred income tax assets, net	$	2,051	$	2,078
Premises and equipment, net	1,217		1,248
Restricted cash	1,047		44
Investments in affordable housing properties	904		943
Equity method investments	841		834
Other	1,901		1,794
Total other assets	$	7,961	$	6,941

At June 30, 2026, we changed the presentation of costs incurred to develop or acquire internal-use capitalized software, previously included in Intangible assets, to now be presented as a component of Premises and equipment, net in the table above. Amounts at December 31, 2025 have been recast to include $1.2 billion of internal-use capitalized software, net of accumulated amortization, within Premises and equipment, net to conform with the current period presentation.

The gross carrying amount for internal-use capitalized software, included in Premises and equipment, was $3.2 billion and $3.1 billion at June 30, 2026 and December 31, 2025, respectively, with accumulated amortization of $2.1 billion and $1.9 billion, respectively.

During the six months ended June 30, 2026, we recorded additions to internal-use capitalized software subject to amortization of $178 million.

Amortization expense related to internal-use capitalized software was $101 million and $84 million for the three months ended June 30, 2026 and 2025, respectively, and $203 million and $168 million for the six months ended June 30, 2026 and 2025, respectively, and is included as a component of Information processing in our Condensed Consolidated Statements of Earnings.

NOTE 7. DEPOSITS


($ in millions)	June 30, 2026		December 31, 2025
Interest-bearing deposits:
Money market and other demand deposits	$	3,010	$	2,837
Savings	29,905		29,777
Certificates of deposit:
Direct	43,321		42,229
Brokered	3,466		3,316
Brokered sweep accounts	2,674		2,589
Total interest-bearing deposits	82,376		80,748
Total non-interest-bearing deposits	430		396
Total deposits	$	82,806	$	81,144

Certificates of Deposit

At June 30, 2026, our certificates of deposit maturing for the remainder of 2026 and over the next four years and thereafter were as follows:


($ in millions)			2026						2027						2028						2029						2030						Thereafter
Certificates of deposit			$	18,919					$	21,517					$	2,498					$	1,356					$	2,096					$	401

At June 30, 2026 and December 31, 2025, direct certificates of deposit of $12.8 billion and $12.3 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 June 30, 2026 and December 31, 2025, the portion of these direct certificates of deposit estimated to be uninsured was $4.4 billion and $4.2 billion, respectively. Brokered certificates of deposit are assumed to be individual deposit balances within applicable FDIC insurance limits.

Brokered Sweep Deposits

Our brokered sweep deposits are sourced through a third-party program arranger that channels deposit accounts to us. Unless extended, the related agreements are scheduled to terminate between 2026 and 2030.

NOTE 8. BORROWINGS


	June 30, 2026						December 31, 2025
($ 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(c)	2026 - 2029	4.06% - 5.74%	4.90	%	$	5,991	$	5,490
Floating securitized borrowings	2027 - 2028	4.32% - 4.75%	4.48	%	2,925		2,925
Total borrowings of consolidated securitization entities			4.76	%	8,916		8,415
Senior unsecured notes:
Synchrony Financial senior unsecured notes:
Fixed senior unsecured notes	2026 - 2031	2.88% - 5.15%	3.90	%	2,893		2,892
Fixed-to-floating senior unsecured notes(d)	2029 - 2036	4.95% - 6.00%	5.46	%	3,281		2,534

Synchrony Bank senior unsecured notes:
Fixed senior unsecured notes	2027	5.63%	5.63	%	599		599

Total senior unsecured notes			4.81	%	6,773		6,025
Subordinated unsecured notes:
Synchrony Financial subordinated unsecured notes:
Fixed subordinated unsecured notes	2033	7.25%	7.25	%	743		742
Total senior and subordinated unsecured notes			5.05	%	7,516		6,767
Total borrowings					$	16,432	$	15,182

(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 $1.0 billion of fixed securitized borrowings which matured and were repaid in July 2026.

(d)Includes $750 million principal amount issued in February 2026, interest rate fixed at 4.947% through February 24, 2031; resets February 25, 2031 to floating rate based on compounded Secured Overnight Financing Rate ("SOFR") plus 153 basis points through maturity in February 2032.

Additional Sources of Liquidity

We have undrawn committed and uncommitted capacity under our credit facilities from private lenders under our securitization programs, subject to customary borrowing conditions, and also have access to the Federal Reserve discount window. At both June 30, 2026 and December 31, 2025, 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, and
available borrowing capacity through the Federal Reserve discount window of $13.1 billion at June 30, 2026 and $10.0 billion at December 31, 2025, based on the amount and type of assets pledged.

NOTE 9. 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 2025 annual consolidated financial statements within our 2025 Form 10-K.

The following tables present our assets measured at fair value on a recurring basis. Liabilities measured at fair value on a recurring basis were not material for the periods presented.

Recurring Fair Value Measurements


At June 30, 2026 ($ in millions)	Level 1		Level 2		Level 3		Total(a)
Assets
Debt securities
U.S. government and federal agency	$	—	$	3,460	$	—	$	3,460
State and municipal	—		—		33		33
Residential mortgage-backed	—		311		—		311
Asset-backed	—		552		—		552
Other	—		—		9		9
Other(b)	35		—		5		40
Total	$	35	$	4,323	$	47	$	4,405

At December 31, 2025 ($ in millions)	Level 1		Level 2		Level 3		Total(a)
Assets
Debt securities
U.S. government and federal agency	$	—	$	1,492	$	—	$	1,492
State and municipal	—		—		35		35
Residential mortgage-backed	—		297		—		297
Asset-backed	—		515		—		515
Other	—		—		9		9
Other(b)	15		—		7		22
Total	$	15	$	2,304	$	51	$	2,370

(a) For the six months ended June 30 2026 and 2025, there were no fair value measurements transferred between levels and changes in our Level 3 assets 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.

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. See Note 2. Basis of Presentation and Summary of Significant Accounting Policies in our 2025 annual consolidated financial statements within our 2025 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 in our Condensed Consolidated Statements of Financial Position.

Financial Assets and Financial Liabilities Carried at Other Than Fair Value


	Carrying		Corresponding fair value amount
At June 30, 2026 ($ in millions)	value		Total		Level 1		Level 2		Level 3
Financial Assets
Financial assets for which carrying values equal or approximate fair value(a):
Cash and equivalents	$	16,193	$	16,193	$	16,193	$	—	$	—
Accrued interest receivable	$	38	$	38	$	38	$	—	$	—
Other assets(b)	$	1,047	$	1,047	$	1,047	$	—	$	—

Financial assets carried at other than fair value:
Loan receivables, net(c)	$	91,894	$	105,027	$	—	$	—	$	105,027



Financial Liabilities
Financial liabilities for which carrying values equal or approximate fair value(a):
Accrued interest payable	$	286	$	286	$	286	$	—	$	—
Financial liabilities carried at other than fair value:
Deposits(d)	$	82,806	$	83,009	$	—	$	83,009	$	—
Borrowings of consolidated securitization entities	$	8,916	$	8,913	$	—	$	5,993	$	2,920

Senior and subordinated unsecured notes	$	7,516	$	7,488	$	—	$	7,488	$	—

	Carrying		Corresponding fair value amount
At December 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(a):
Cash and equivalents	$	14,973	$	14,973	$	14,973	$	—	$	—
Accrued interest receivable	$	27	$	27	$	27	$	—	$	—
Other assets(b)	$	44	$	44	$	44	$	—	$	—

Financial assets carried at other than fair value:
Loan receivables, net(c)	$	93,364	$	106,591	$	—	$	—	$	106,591


Financial Liabilities
Financial liabilities for which carrying values equal or approximate fair value(a):
Accrued interest payable	$	287	$	287	$	287	$	—	$	—
Financial liabilities carried at other than fair value:
Deposits(d)	$	81,144	$	81,374	$	—	$	81,374	$	—
Borrowings of consolidated securitization entities	$	8,415	$	8,477	$	—	$	5,559	$	2,918

Senior and subordinated unsecured notes	$	6,767	$	6,870	$	—	$	6,870	$	—

(a) Carrying value approximates fair value as the financial assets and liabilities are liquid in nature or have a short-term maturity.

(b) This balance relates to restricted cash and equivalents, which is included in Other assets in our Condensed Consolidated Statements of Financial Position.

(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)Includes demand deposits with no defined maturity.

Equity Securities Without Readily Determinable Fair Values


	Three months ended				Six months ended
At or for the periods ended June 30 ($ in millions)	2026		2025		2026		2025
Carrying value(a)	$	266	$	275	$	266	$	275
Upward adjustments(b)	$	—	$	—	$	—	$	—
Downward adjustments(b)	$	(2)	$	—	$	(2)	$	—

(a) Carrying value reflects cumulative purchases and sales in addition to upward and downward carrying value changes, and at December 31, 2025 was $269 million.

(b) Between January 1, 2018 and June 30, 2026, cumulative upward and downward carrying value adjustments for equity securities held at June 30, 2026 were $201 million and $(12) million, respectively.

NOTE 10. REGULATORY AND CAPITAL ADEQUACY

At June 30, 2026 and December 31, 2025, Synchrony Financial met all minimum capital requirements and the applicable requirements to be deemed well-capitalized pursuant to Federal Reserve Board regulations. At June 30, 2026 and December 31, 2025, 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 June 30, 2026 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 June 30, 2026 ($ in millions)	Actual				Minimum for capital adequacy purposes
	Amount		Ratio(a)		Ratio(b)
Total risk-based capital	$	17,782	16.9	%	8.0	%
Tier 1 risk-based capital	$	15,616	14.9	%	6.0	%
Tier 1 leverage	$	15,616	13.0	%	4.0	%
Common equity Tier 1 Capital	$	13,900	13.2	%	4.5	%


At December 31, 2025 ($ in millions)	Actual(c)				Minimum for capital adequacy purposes
	Amount		Ratio(a)		Ratio(b)
Total risk-based capital	$	17,691	16.7	%	8.0	%
Tier 1 risk-based capital	$	15,512	14.6	%	6.0	%
Tier 1 leverage	$	15,512	13.3	%	4.0	%
Common equity Tier 1 Capital	$	14,290	13.5	%	4.5	%

Synchrony Bank


At June 30, 2026 ($ in millions)	Actual				Minimum for capital adequacy purposes		Minimum to be well-capitalized under prompt corrective action provisions
	Amount		Ratio(a)		Ratio(b)		Ratio
Total risk-based capital	$	16,427	16.5	%	8.0	%	10.0	%
Tier 1 risk-based capital	$	14,321	14.4	%	6.0	%	8.0	%
Tier 1 leverage	$	14,321	12.6	%	4.0	%	5.0	%
Common equity Tier 1 capital	$	14,321	14.4	%	4.5	%	6.5	%


At December 31, 2025 ($ in millions)	Actual(c)				Minimum for capital adequacy purposes		Minimum to be well-capitalized under prompt corrective action provisions
	Amount		Ratio(a)		Ratio(b)		Ratio
Total risk-based capital	$	16,162	16.1	%	8.0	%	10.0	%
Tier 1 risk-based capital	$	14,045	14.0	%	6.0	%	8.0	%
Tier 1 leverage	$	14,045	12.7	%	4.0	%	5.0	%
Common equity Tier 1 capital	$	14,045	14.0	%	4.5	%	6.5	%

(a)Capital ratios are calculated based on the Basel III Standardized Approach rules.

(b)At June 30, 2026 and December 31, 2025, Synchrony Financial and the Bank also must maintain a stress capital buffer or capital conservation buffer, as applicable, in excess of minimum risk-based capital ratios, which exclude the Tier 1 leverage ratio, by at least 2.5 percentage points to avoid limits on capital distributions and certain discretionary bonus payments to executive officers and similar employees.

(c)Amounts and ratios at December 31, 2025 have been recast to reflect the change in presentation of internal-use capitalized software on our Condensed Consolidated Statements of Financial Position. See Note 2. Basis of Presentation and Summary of Significant Accounting Policies for additional information.

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.

For additional information on the minimum capital requirements for both Synchrony Financial and the Bank, see "Regulation—Regulation Relating to Our Business—Capital for both Savings and Loan Holding Company Regulation and Savings Association Regulation," as applicable, in addition to Note 11. Regulatory and Capital Adequacy, in our 2025 Form 10-K.

NOTE 11. 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 June 30,				Six months ended June 30,
($ and shares in millions, except per share data)	2026		2025		2026		2025
Net earnings	$	885	$	967	$	1,690	$	1,724
Preferred stock dividends	(21)		(21)		(42)		(42)
Net earnings available to common stockholders	$	864	$	946	$	1,648	$	1,682

Weighted average common shares outstanding, basic	331.3		376.2		336.8		380.7
Effect of dilutive securities	2.8		2.9		3.2		3.5
Weighted average common shares outstanding, dilutive	334.1		379.1		$	340.0	384.2

Earnings per basic common share	$	2.61	$	2.51	$	4.89	$	4.42
Earnings per diluted common share	$	2.59	$	2.50	$	4.85	$	4.38

We have issued stock-based awards under the Synchrony Financial 2024 Long-Term Incentive Plan, along with prior incentive plans. Awards that were considered anti-dilutive and therefore were excluded from the computation of diluted earnings per common share were less than 1 million shares for each of the periods presented.

NOTE 12. EQUITY AND OTHER STOCK RELATED INFORMATION

Preferred Stock

At June 30, 2026 and December 31, 2025, the Company had 1.26 million and 1.25 million shares, respectively, of preferred stock outstanding, which had previously been approved by our Board for issuance. In addition, subject to approval from the Board, we have the ability to issue additional series of preferred stock up to a maximum of 300 million shares at a par value of $0.001 per share authorized for issuance. The following table summarizes the Company's preferred stock issued and outstanding at June 30, 2026 and December 31, 2025.


Series	Issuance Date	Redeemable by Issuer Beginning	Per Annum Dividend Rate	Liquidation Preference per Share	Total Shares Outstanding	June 30, 2026		December 31, 2025
($ in millions, except per share data)
Series A(a)	November 14, 2019	November 15, 2024	5.625%	$1,000	750,000	$	734	$	734
Series B(a)	February 23, 2024	May 15, 2029	8.25%(b)	$1,000	500,000	$	488	$	488
Series C(a)	June 5, 2026	August 15, 2031	7.25%(c)	$100,000	5,000	$	494	$	—
						$	1,716	$	1,222

(a)Issued as depositary shares, each representing a 1/40th interest in a share of Series A and B non-cumulative perpetual preferred stock, and representing a 1/100th interest in a share of Series C non-cumulative perpetual preferred stock. Dividends are payable quarterly on February 15, May 15, August 15 and November 15 of each calendar year at a fixed rate, in each case when, as and if declared by the Board of Directors.

(b)Through May 14, 2029; resets May 15, 2029 and each date falling on the fifth anniversary at 5-Year Treasury Rate plus 4.044%.

(c)Through August 14, 2031; resets August 15, 2031 and each date falling on the fifth anniversary at 5-Year Treasury Rate plus 3.078%.

NOTE 13. INCOME TAXES

Unrecognized Tax Benefits


($ in millions)	June 30, 2026		December 31, 2025
Unrecognized tax benefits, excluding related interest expense and penalties(a)	$	237	$	218
Portion that, if recognized, would reduce tax expense and effective tax rate(b)	$	187	$	172

(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.

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 2026 tax year, and thus the tax year is under IRS review. The IRS is also examining our 2025 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 2019.

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 our 2025 Form 10-K.

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


	Three months ended June 30,				Six months ended June 30,
($ in millions)	2026		2025		2026		2025
Interest and fees on loans	$	5,380	$	5,328	$	10,793	$	10,640
Interest on cash and debt securities	203		258		393		496
Total interest income	5,583		5,586		11,186		11,136
Total interest expense	975		1,065		1,943		2,151
Net interest income	4,608		4,521		9,243		8,985

Retailer share arrangements	(1,027)		(992)		(2,097)		(1,887)

Reserve build (release)	(163)		(265)		(174)		(362)
Net charge-offs	1,364		1,411		2,710		2,999
Provision for credit losses	1,201		1,146		2,536		2,637

Other income:
Other income	137		118		270		267


Total other income	137		118		270		267

Other expense:
Employee costs	516		509		1,031		1,015
Professional fees	220		236		429		453
Marketing and business development	137		127		251		243
Information processing	248		215		510		434
Fraud-related operational losses	78		34		166		75
Other segment items(a)	132		124		260		268
Total other expense	1,331		1,245		2,647		2,488

Provision for income taxes	301		289		543		516

Net earnings	$	885	$	967	$	1,690	$	1,724

_____________

(a)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 our 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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