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SYFSynchrony Financial

Financials · Financial Services · NYSE
SYF quote by TradingView
Employees
20,000
Headquarters
Stamford, CT
Next results
around Jan 26, 2027
Compare with peers → Embed

10-K 0001601712-26-000006 (2026-02-06) vs 10-K 0001601712-25-000044 (2025-02-07)

SectionCompared textWords nowChanged
Risk FactorsItem 1A18,551 10.8%
MD&AItem 79,236 25.9%
Legal ProceedingsItem 3467 0.0%
Accounting PoliciesItem 8, Note 2 – BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES6,727 14.7%

The redline: what was cut and what was added

In each section, the paragraph that changed most, marked against last year's 10-K: cut words struck through, new words highlighted and underlined.

Accounting Policies 236 words changed in this paragraph; it is 33% similar to last year's version.
Losses on loan receivables are estimated and recognized upon origination of the loan, and updated based on expected credit losses for the life of the loan balance as of at 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 characteristics, such as retailer, performance and supportable forecast period. The model considers a macroeconomic forecast, with unemployment as the primary macroeconomic variable considered. We also perform a qualitative assessment in addition to model estimates and apply qualitative adjustments as necessary. 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 December 31, 2024 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, gradually increasing the weight of historical losses by an equal amount each month during the reversion period, 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 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.

Source: Item 8, Note 2 – BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, 10-K 0001601712-26-000006 vs Item 8, Note 2 – BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, 10-K 0001601712-25-000044

Risk Factors 233 words changed in this paragraph; it is 46% similar to last year's version.
We Additionally, emerging digital assets, such as stablecoins, may also face increased competition from current competitors or others who introduce or embrace disruptive technology grow to become an alternative form of payment tender that significantly changes the consumer credit and competes with our payment industry. products. We compete for customers and their usage of our products, and to minimize transfers to competitors of our customers’ outstanding balances, based on a number of factors, including pricing (interest rates and fees), product offerings, credit limits, incentives (including loyalty programs) and customer service. Although we offer a variety of consumer credit products, some of our competitors provide a broader selection of services, including home and automobile loans and other consumer banking services, which may position them better among customers who prefer to use a single financial institution to meet all of their financial needs. Some of our competitors are substantially larger than we are, which may give those competitors advantages, including a more diversified product and customer base, the ability to reach out to more customers and potential customers, operational efficiencies, more versatile technology platforms, broad-based local distribution capabilities and lower-cost funding. In addition, some of our competitors, including new and emerging competitors in the digital and mobile payments space, are not subject to the same regulatory requirements or legislative scrutiny to which we are subject. Non-bank providers of pay-over-time solutions, such as Affirm, Afterpay, Klarna and others, extend consumer credit-like offerings but do not face the same restrictions, such as capital requirements and other regulatory requirements, as banks, which also could place us at a competitive disadvantage. In addition, some larger technology focused companies, e.g., Apple and Google, and larger retailers, e.g., Walmart and Target, are now offering financial products sometimes in collaboration with our competitors. Customer attrition from any or all of our credit products or any lowering of the pricing of our products by reducing interest rates or fees in order to retain customers could reduce our revenues and, therefore, our earnings.

Source: Item 1A, 10-K 0001601712-26-000006 vs Item 1A, 10-K 0001601712-25-000044

MD&A 225 words changed in this paragraph; it is 49% similar to last year's version.
•Growth in loan receivables and interest and fees on loans. For the year ended December 31, 2024 2025 we experienced an increase a decrease in period-end loan receivables of 1.7% 0.9%, reflecting higher payment rates as a result of our improved credit mix, as well as flat purchase volume and lower average active accounts compared to the year ended December 31, 2024 as the credit actions we took across our portfolio in prior years continued moderation of customer payment behavior and the to impact of the Ally Lending acquisition, and interest loan receivable growth. Interest and fees on loans increased by 8.5%, 0.5%, driven primarily by loan receivables growth and the impacts from the implementation of our product, pricing and policy changes. These factors were changes, offset by a combination of lower benchmark rates and a decrease in average loan receivables, as well as lower late fee incidence. In 2026, we expect loan receivables to increase, reflecting growth in both purchase volume and average active accounts, including the impact from new or recently launched programs, partially offset by a decrease in purchase volume of 1.6%, primarily driven by lower consumer spending and the impacts continued effects from credit actions we have taken across our portfolio. elevated payment rates. In 2025, addition, we expect interest and fees on loans to increase, primarily reflecting the continued impact of our product, pricing and policy changes implemented changes, and growth in 2024, and expect loan receivables growth to continue to be impacted by the effects from the credit actions we have taken and consumer spend behavior, while also reflecting generally stable customer payment rates. receivables. In addition, the amount of the increases will be dependent on various factors, including whether customer payment rate trends and consumer spend behavior differs from our expectations, as well as any changes in benchmark interest rates. See above for potential additional impacts from rates or other regulatory or legislative developments that may impact the CFPB final rule yield on credit card late fees. our loan receivables.

Source: Item 7, 10-K 0001601712-26-000006 vs Item 7, 10-K 0001601712-25-000044

Every change, by type

Sentences and paragraphs of SYF's Risk Factors and MD&A, 10-K 2026-02-06 against 10-K 2025-02-07. Each links to the text at sec.gov.

All 170 Added 16Removed 25Reworded 124Quiet changes 5

Quiet changes are sentences kept from last year with one to four words changed, at least one of them a hedge, a modal or a qualifier (may, could, will, not, significant, material…). A year or date rolling forward is not counted.

The full word listadverse, adversely, all, although, anticipate, anticipates, any, approximately, believe, believes, can, cannot, certain, could, expect, expects, generally, however, if, intend, intends, largely, likely, many, material, materially, may, might, most, must, never, no, not, possible, primarily, probable, should, significant, significantly, some, substantial, substantially, unlikely, will, would

AddedRisk Factors
Competitive dynamics in the consumer credit and payments industry may adversely impact our ability to attract and retain customers, and the utilization of our products.

Read it in 10-K 2026-02-06 at sec.gov ↗

AddedRisk Factors
We maintain an allowance for credit losses in accordance with U.S. GAAP, known as CECL, to provide for expected credit losses for the life of our loan portfolio, including acquired loan portfolios. Upon origination of a loan portfolio, the estimate of expected credit losses, and any subsequent changes to such estimate, are recorded through Provision for credit losses in our Consolidated Statements of Earnings.

Read it in 10-K 2026-02-06 at sec.gov ↗

AddedRisk Factors
Additionally, in November 2025, Visa and Mastercard announced a proposed settlement to resolve a long-standing class action antitrust lawsuit. The proposed settlement, which is subject to approval by the U.S. District Court for the Eastern District of New York and applicable to U.S. Visa and Mastercard credit cards, will among other items, categorize the credit cards into three distinct categories: commercial, premium consumer and standard consumer; reduce the U.S. combined average effective credit card interchange rate by 10 basis points for five years; cap posted U.S. credit card interchange rates at the March 2025 levels for five years; institute a 125 basis points cap on interchange rates for standard consumer credit cards through the term of the settlement agreement; and permit merchants to (i) choose whether or not to accept premium consumer, standard consumer, and/or commercial credit cards, as well as choose which digital wallets to accept, and (ii) impose a surcharge of up to three percent at the brand (e.g., Visa or Mastercard) or product (e.g., Visa Signature) level.

Read it in 10-K 2026-02-06 at sec.gov ↗

RemovedRisk Factors
•The CFPB's final rule on credit card late fees, if implemented, would likely materially adversely affect our business and results of operations.

Read it in 10-K 2025-02-07 at sec.gov ↗

RemovedRisk Factors
The CFPB's final rule on credit card late fees, if implemented, would likely materially adversely affect our business and results of operations.

Read it in 10-K 2025-02-07 at sec.gov ↗

RemovedRisk Factors
On March 5, 2024, the CFPB issued a final rule amending its regulations that implement the Truth in Lending Act to, among other things, lower the safe harbor dollar amount for credit card late fees from $30 (adjusted to $41 for each subsequent late payment within the next six billing cycles) to $8 and eliminate the automatic annual inflation adjustment to such safe harbor dollar amount. The final rule, when effective, will result in a significant reduction in our interest and fees on loan receivables. Industry organizations have challenged the final rule in court. The final rule had an original effective date of May 14, 2024; however, on May 10, 2024, the United States District Court for the Northern District of Texas granted an injunction and stay of the final rule, and the injunction remains in effect. The ultimate outcome of this litigation and the impact on the final rule, including whether the final rule will become effective and if effective, the timing of implementation, is uncertain. We continue to closely monitor relevant developments and the impact on our business. If the final rule does not become effective, there is also a risk that new regulations relating to late fees may be proposed.

Read it in 10-K 2025-02-07 at sec.gov ↗

RemovedRisk Factors
For the year ended December 31, 2024, interest income on loan receivables includes fees on loans, which primarily consist of late fees on our credit products, of $2.5 billion, net of reversals. A significant reduction in the late fees the Company charges would reduce our fees on loans and could also impact the competitiveness of our credit products and our ability and willingness to provide certain products and services, or to continue to offer our products to certain customers. In anticipation that the final rule will become effective, we have implemented a number of product, pricing and policy changes to adjust for the significant reduction in our late fee income. The effects of these changes have started to be reflected in our Consolidated Statement of Earnings for the year ended December 31, 2024. These changes may subject us to a variety of risks, due to, among other things, additional costs and partner, customer and other stakeholder acceptance.

Read it in 10-K 2025-02-07 at sec.gov ↗

RemovedRisk Factors
Further, it will take time for these product, pricing and policy changes to offset the impact of a significant reduction in the late fees we charge and there can be no assurance that these changes will fully offset the impact. Additionally, we are unable to predict the impact the product, pricing and policy changes and the implementation of the final rule itself or the final rule not becoming effective, will have on our customers’ and overall consumer behavior, including in regard to our ability to retain existing customers and attract new customers.

Read it in 10-K 2025-02-07 at sec.gov ↗

RemovedRisk Factors
Our inability to successfully manage the foregoing risks could result in harm to our reputation and our brand, as well as subject us to additional scrutiny from regulators and other stakeholders. If we are unable to continue to charge late fees at levels similar to those permitted under existing regulatory guidance or effectively offset the impacts of a significant reduction in the late fees we charge, there would be a material adverse effect on our business, results of operations and/or financial condition.

Read it in 10-K 2025-02-07 at sec.gov ↗

RemovedRisk Factors
We maintain an allowance for credit losses (a reserve established through a provision for credit losses charged to expense) that we believe is appropriate to provide for expected credit losses for the life of our loan portfolio. In addition, for portfolios we acquire when we enter into new partner program agreements we are required to establish an allowance for expected credit losses for the life of the acquired loan portfolio. Any subsequent deterioration in the performance of the purchased portfolios after acquisition results in incremental credit loss reserves. Growth in our loan portfolio generally would also lead to an increase in the allowance for credit losses.

Read it in 10-K 2025-02-07 at sec.gov ↗

RemovedRisk Factors
Synchrony currently acts as servicer with respect to our nonbank subsidiary securitization trust, and the Bank acts as servicer with respect to our other two securitization trusts. If Synchrony or the Bank, as applicable, defaults in its servicing obligations, an early amortization event could occur with respect to the relevant asset-backed securities and/or Synchrony or the Bank, as applicable, could be replaced as servicer. Servicer defaults include, for example, the failure of the servicer to make any payment, transfer or deposit in accordance with the securitization documents, a breach of representations, warranties or agreements made by the servicer under the securitization documents, the delegation of the servicer’s duties contrary to the securitization documents and the occurrence of certain insolvency events with respect to the servicer. Such an early amortization event would have the adverse consequences discussed in the immediately preceding risk factor.

Read it in 10-K 2025-02-07 at sec.gov ↗

RemovedRisk Factors
If either Synchrony or the Bank defaults in its servicing obligations with respect to any of our three securitization trusts, a third party could be appointed as servicer of such trust. If a third-party servicer is appointed, the third party may not engage us as sub-servicer, in which event we would no longer be able to control the manner in which the related trust’s assets are serviced, and the failure of a third party to appropriately service such assets could lead to an early amortization event in the affected securitization trust, which would have the adverse consequences discussed in the immediately preceding risk factor.

Read it in 10-K 2025-02-07 at sec.gov ↗

RemovedRisk Factors
Our risk management processes and procedures seek to appropriately balance risk and return and mitigate risks. We have established processes and procedures intended to identify, measure, monitor and control the types of risk to which we are subject, including credit risk, market risk, liquidity risk, operational risk, compliance risk, legal risk, strategic risk, and reputational risk. Credit risk is the risk of loss that arises when an obligor fails to meet the terms of an obligation. We are exposed to both consumer credit risk, from our customer loans, and institutional credit risk, principally from our partners. Market risk refers to the risk that a change in the level of one or more market prices, rates, indices, correlations or other market factors will result in losses for a position or portfolio. Liquidity risk is the risk that financial condition or overall safety and soundness are adversely affected by an inability, or perceived inability, to meet obligations and support business growth. Operational risk is the risk of loss arising from inadequate or failed processes, people or systems, external events (e.g., natural disasters and cybersecurity incidents), reputational matters and includes those risks as they relate directly to us as well as to third parties with whom we contract or otherwise do business. Compliance risk is the risk of non-compliance with applicable laws, rules, regulations, other supervisory guidance, and internal policies, and also includes any of those risks as they relate directly to us and our subsidiaries, as well as to third parties with whom we contract or otherwise do business. Legal risk is the risk of potential disputes, litigation, defective agreements or unprotected or infringed rights that can disrupt or otherwise negatively affect operations or condition of the organization. Strategic risk is the risk from changes in the business environment, improper implementation of decisions or inadequate responsiveness to changes in the business environment. Reputational risk is the risk arising from negative perception on the part of stakeholders, including customers, counterparties, shareholders, investors, rating agencies, regulators and employees that can adversely affect the Company’s ability to maintain existing talent and customers and establish new business relationships with continued access to sources of funding. See “Our Business—Credit Risk Management” and “Risks—Risk Management” for additional information on the types of risks affecting our business.

Read it in 10-K 2025-02-07 at sec.gov ↗

RewordedRisk Factors
A partner may terminate an agreement for various reasons, including, in some cases, if we fail to meet certain service levels or change certain key cardholder terms or our credit criteria, we fail to achieve certain targets with respect to approvals of new customers as a result of changes in the credit criteria we use, we elect not to increase the program size when the outstanding loan receivables under the program reach certain thresholds or we use are not adequately capitalized, certain force majeure events or changes in our ownership occur, or a material adverse change in our financial condition or a significant change in law occurs. occurs and the parties cannot agree on program changes to mitigate the economic impact to the impacted party.

Read it in 10-K 2026-02-06 at sec.gov ↗

RewordedRisk Factors
To Moreover, there are regulatory reforms that have been proposed in the extent United States and adopted internationally, generally referred to as “Basel III,” that the Basel III requirements may result in increased costs to the banks providing undrawn committed capacity under our securitization programs, programs; costs these costs are banks would likely to be passed pass on to us.

Read it in 10-K 2026-02-06 at sec.gov ↗

RewordedRisk Factors
Harm to our reputation can arise from many sources, including employee from misconduct, or perceived misconduct by of our directors, employees, partners, outsourced service providers or other counterparties, litigation or regulatory actions, failure by us or our partners to meet minimum standards of service and quality, inadequate protection of customer information information, compliance failures and compliance failures. any action or inaction taken by the Company that does not align with stockholder preferences.

Read it in 10-K 2026-02-06 at sec.gov ↗

RewordedRisk Factors
In addition, significant assumptions and estimates are involved in determining certain disclosures required under GAAP, including those involving the fair value of our financial assets and financial liabilities carried at other than fair value in our Consolidated Statement of Financial Position. U.S.

Read it in 10-K 2026-02-06 at sec.gov ↗

RewordedRisk Factors
These include eCarts (e.g., Shopify and Magento), and independent software vendors (e.g., ServiceTitan). ServiceTitan) and payment processors (e.g., Stripe and Adyen), as well as multi-source financing platforms, such as Versatile Credit which we acquired in October 2025.

Read it in 10-K 2026-02-06 at sec.gov ↗

RewordedRisk Factors
Additionally, while we maintain insurance coverage that, subject to applicable terms and conditions, may cover certain aspects of cybersecurity and information risks, coverage, such insurance coverage may not be sufficient to cover all losses or offset the impact of such events.

Read it in 10-K 2026-02-06 at sec.gov ↗

RewordedRisk Factors
We are required to make various assumptions and estimates in preparing our financial statements under GAAP, primarily including for purposes of determining our allowance for credit losses and for fair value measurements, as well as other areas such as, as reserves related to litigation and other contingencies, valuation allowances on deferred income tax assets and determining liabilities for income taxes.

Read it in 10-K 2026-02-06 at sec.gov ↗

RewordedRisk Factors
Our credit underwriting and risk management strategies are used to manage our credit exposures; however, there can be no assurance that those will such strategies may not enable us to avoid high charge-off levels or delinquencies, or that and our allowance for credit losses will may not be sufficient to cover actual losses.

Read it in 10-K 2026-02-06 at sec.gov ↗

RewordedRisk Factors
In particular, adverse perceptions regarding our reputation could also make it more difficult for us to attract and retain customers, partners partners, investors, directors and employees, as well as promote and increase the utilization of our credit products, as well as products and execute on our strategy of increasing retail deposits at the Bank and Bank, which may lead to decreases in deposits.

Read it in 10-K 2026-02-06 at sec.gov ↗

RewordedRisk Factors
There can be no assurance that Any of our historical tax positions will not could be challenged by relevant tax authorities or that and we would may not be successful in defending our positions in connection with any such challenge.

Read it in 10-K 2026-02-06 at sec.gov ↗

RewordedRisk Factors
We employ detection, prevention and response mechanisms designed to identify, prevent, contain and mitigate security incidents, but these mechanisms may not be sufficient and early detection may be thwarted by sophisticated attacks and malware designed to avoid detection (e.g., use of generative artificial intelligence technologies) and the extent to which preventative measures may be effective may likewise be dependent on the sophistication and complexity of such attacks.

Read it in 10-K 2026-02-06 at sec.gov ↗

RewordedRisk Factors
The CECL model requires, upon origination of a loan, the recognition of all requires us to estimate expected credit losses over the life of the loan based on historical experience, current conditions and reasonable and supportable forecasts.

Read it in 10-K 2026-02-06 at sec.gov ↗

Quiet changesRisk Factors
Our resources, technologies and fraud prevention tools are not foolproof and may be insufficient to accurately detect and prevent all of the various forms and instances of fraud.

Read it in 10-K 2026-02-06 at sec.gov ↗

Quiet changesRisk Factors
We will continue to periodically review and enhance our current methodology, models and the underlying assumptions, estimates and assessments we use to establish our allowance for credit losses to reflect our view of current conditions and reasonable and supportable forecasts.

Read it in 10-K 2026-02-06 at sec.gov ↗

Quiet changesRisk Factors
We may not identify customers who are likely to default on their payment obligations to us and therefore may not reduce our exposure by closing credit lines and restricting authorizations quickly enough, which could have a material adverse effect on our business, results of operations and financial condition.

Read it in 10-K 2026-02-06 at sec.gov ↗

AddedMD&A
In October 2025, we acquired Versatile Credit, Inc. ("Versatile Credit"), a leading multi-source financing platform connecting merchants, lenders and consumers through point-of-sale solutions.

Read it in 10-K 2026-02-06 at sec.gov ↗

AddedMD&A
New partnerships: • Bob's Discount Furniture Home & Auto • Dental Intelligence Health & Wellness • OnePay Diversified & Value • RH Home & Auto • Texas A&M University Veterinary Medical Teaching Hospital Health & Wellness • Toro Lifestyle Program extensions: • Amazon Digital • American Eagle Lifestyle • Ashley HomeStores, Inc. Home & Auto • Discount Tire Home & Auto • Gardner White Home & Auto • Home Furnishings Association Home & Auto • Polaris Lifestyle • Regency Showrooms Home & Auto

Read it in 10-K 2026-02-06 at sec.gov ↗

AddedMD&A
•In addition, we expanded our existing Lowe's commercial program and announced the acquisition of the Lowe's commercial co-branded credit card portfolio, with loan receivables of approximately $0.8 billion, which is expected to close in the first half of 2026.

Read it in 10-K 2026-02-06 at sec.gov ↗

AddedMD&A
On July 4, 2025, Public Law 119-21 known as the One Big Beautiful Bill Act or the Working Families Tax Cut Act (the “Act”) was enacted into law, which included certain modifications to U.S. tax law. The Company has completed its initial evaluation of the provisions of the Act and does not expect it to have a material impact on our Consolidated Financial Statements.

Read it in 10-K 2026-02-06 at sec.gov ↗

AddedMD&A
In 2025, we entered into an agreement to sell $0.2 billion of loan receivables associated with a Home & Auto partner program agreement, which closed in October 2025. In connection with this agreement, revenue activities for the portfolio were no longer managed within our Home & Auto sales platform. All related metrics previously reported within our Home & Auto sales platform, are now reported within Corp, Other below. We have also recast all prior-period reported metrics for our Home & Auto sales platform and Corp, Other to conform to the current-period presentation.

Read it in 10-K 2026-02-06 at sec.gov ↗

AddedMD&A
The decrease in Loan receivables also included the impact of the sale of $0.2 billion of loan receivables associated with a Home & Auto partner program agreement in October 2025.

Read it in 10-K 2026-02-06 at sec.gov ↗

AddedMD&A
($ in millions) Within 1 1-5 Years(2) 5-15 Years After Total Year(1) 15 Years Loan receivables Credit cards $ 94,870 $ 1,476 $ — $ — $ 96,346 Consumer installment loans(3) 2,114 3,340 94 — 5,548 Commercial credit products 1,812 21 — — 1,833 Other 31 22 25 3 81 Total loan receivables $ 98,827 $ 4,859 $ 119 $ 3 $ 103,808 Loans due after one year at fixed interest rates N/A $ 4,859 $ 119 $ 3 $ 4,981 Loans due after one year at variable interest rates N/A — — — — Total loan receivables due after one year N/A $ 4,859 $ 119 $ 3 $ 4,981

Read it in 10-K 2026-02-06 at sec.gov ↗

RemovedMD&A
•In February 2024, we issued depositary shares representing $500 million of Series B 8.250% fixed rate reset non-cumulative perpetual preferred stock.

Read it in 10-K 2025-02-07 at sec.gov ↗

RemovedMD&A
•In March 2024, we sold our wholly-owned subsidiary, Pets Best, for consideration comprising a combination of cash and an equity interest in Independence Pet Holdings, Inc. The sale resulted in the recognition of a gain on sale of $1.1 billion, or $802 million net of tax.

Read it in 10-K 2025-02-07 at sec.gov ↗

RemovedMD&A
•In March 2024, we acquired Ally Lending for cash consideration of $2.0 billion. The assets and liabilities of Ally Lending primarily included loan receivables with an unpaid principal balance of $2.2 billion. See Note 3. Acquisitions and Dispositions to our consolidated financial statements for additional information.

Read it in 10-K 2025-02-07 at sec.gov ↗

RemovedMD&A
Home & Auto: New partnerships: • Bel Furniture • The Carpet Guys • National Alliance Trade Merchants (NATM) Program extensions: • Associated Materials • Generac • Big Sandy • Jerome's Furniture • BrandsMart • P.C. Richard & Son

Read it in 10-K 2025-02-07 at sec.gov ↗

RemovedMD&A
Health & Wellness: New partnerships: • Bond Veterinary • Pet Paradise • Lakefield Veterinary Group • Western Veterinary • LaserAway Extensions: • Bosley • LCA Vision • HearingLife • SCI • Innovetive • Suveto

Read it in 10-K 2025-02-07 at sec.gov ↗

RemovedMD&A
•We added two new strategic technology partnerships with Adit Practice Management Software and ServiceTitan, both of which expand access for customers to our suite of credit products.

Read it in 10-K 2025-02-07 at sec.gov ↗

RemovedMD&A
•We entered into a relationship with Atlanticus Holdings Corporation to deliver a preferred second look financing solution for private label credit cards and installment loan products across our business.

Read it in 10-K 2025-02-07 at sec.gov ↗

RemovedMD&A
•CFPB final rule on credit card late fees. On March 5, 2024, the CFPB issued a final rule amending its regulations that implement the Truth in Lending Act to, among other things, lower the safe harbor dollar amount for credit card late fees from $30 (adjusted to $41 for each subsequent late payment within the next six billing cycles) to $8 and eliminate the automatic annual inflation adjustment to such safe harbor dollar amount. The final rule, when effective, will result in a significant reduction in our interest and fees on loan receivables. Industry organizations have challenged the final rule in court. The final rule had an original effective date of May 14, 2024; however, on May 10, 2024, the United States District Court for the Northern District of Texas granted an injunction and stay of the final rule, and the injunction remains in effect. As a result, the ultimate outcome and impact of this litigation on the final rule, including whether the final rule will become effective, and if it were to becomes effective, the timing of such implementation, is uncertain.

Read it in 10-K 2025-02-07 at sec.gov ↗

RemovedMD&A
In anticipation that the final rule will become effective, in 2024 we implemented a number of product, pricing and policy changes. See below for discussions on our other trends and conditions, which include consideration of the impact of these changes upon our business and results of operations.

Read it in 10-K 2025-02-07 at sec.gov ↗

RemovedMD&A
While we continue to believe that over time the strategies we have implemented will fully offset the decline in late fee income resulting from an effective final rule, it may take time for such product, pricing and policy changes to offset the expected reduction in late fees if the final rule is implemented. In addition, in the event that the final rule is implemented, this would result in a decrease in payments to partners pursuant to our retailer share arrangements. However, the effects of the final rule are also subject to other factors that could increase the adverse effects to our results of operations, including any potential changes in consumer behavior in response to the product, pricing and policy changes or the implementation of the final rule itself, if that occurs.

Read it in 10-K 2025-02-07 at sec.gov ↗

RewordedMD&A
The increase in Health & Wellness interest and fees on loans was increased by $112 million, or 3.1%. for the year ended December 31, 2025, primarily driven by growth an increase in average loan receivables, receivables yield, reflecting the impact of our product, pricing and policy changes and lower customer payment rates, changes, as well as higher average loan receivables, partially offset by lower late fee incidence and higher reversals.

Read it in 10-K 2026-02-06 at sec.gov ↗

RewordedMD&A
Employee costs decreased increased by $12 $221 million, or 0.6%, 11.8%, for the year ended December 31, 2024, 2025, primarily attributable to $43 million of driven by restructuring costs related to a voluntary early retirement program program, higher variable compensation, as well as changes in the prior year, partially offset by costs related headcount mix to the Ally Lending acquisition. support technology investments and higher medical benefit costs.

Read it in 10-K 2026-02-06 at sec.gov ↗

RewordedMD&A
The increase in Digital interest and fees on loans was increased by $128 million, or 2.0%, for the year ended December 31, 2025, primarily driven by growth in higher average loan receivables, receivables yield, reflecting the impact impacts of our product, pricing and policy changes and lower customer payment rates, changes, partially offset by higher reversals. lower benchmark rates and lower late fee incidence.

Read it in 10-K 2026-02-06 at sec.gov ↗

RewordedMD&A
Credit cards (294) 423 129 979 234 1,213 1,974 896 2,870 Consumer installment loans (11) (19) (30) 257 196 453 73 41 114 Commercial credit products (1) 8 7 11 18 29 14 19 33 Other (2) (2) (4) — (1) (1) 4 — 4 Total loan receivables, including held for sale (308) 410 102 1,247 447 1,694 2,065 956 3,021 Change in interest income from total interest-earning assets $ (275) $ 231 $ (44) $ 1,417 $ 518 $ 1,935 $ 2,121 $ 1,443 $ 3,564 Interest-bearing liabilities:

Read it in 10-K 2026-02-06 at sec.gov ↗

RewordedMD&A
Interest-bearing deposit accounts $ (48) $ (428) $ (476) $ 265 $ 589 $ 854 $ 173 $ 1,771 $ 1,944 Borrowings of consolidated securitization entities 14 (24) (10) 79 8 87 (6) 150 144 Senior and subordinated unsecured notes (28) 15 (13) (27) 9 (18) 62 40 102 Change in interest expense from total interest-bearing liabilities (62) (437) (499) 317 606 923 229 1,961 2,190 Total change in net interest income $ (213) $ 668 $ 455 $ 1,100 $ (88) $ 1,012 $ 1,892 $ (518) $ 1,374

Read it in 10-K 2026-02-06 at sec.gov ↗

RewordedMD&A
In 2025, addition, we expect interest and fees on loans to increase, primarily reflecting the continued impact of our product, pricing and policy changes implemented changes, and growth in 2024, and expect loan receivables growth to continue to be impacted by the effects from the credit actions we have taken and consumer spend behavior, while also reflecting generally stable customer payment rates. receivables.

Read it in 10-K 2026-02-06 at sec.gov ↗

RewordedMD&A
Diversified & Value interest and fees on loans increased decreased by $261 $65 million, or 5.8%, 1.4%, for the year ended December 31, 2024, 2025, primarily driven by growth in lower average loan receivables, receivables yield, reflecting lower payment benchmark rates and higher benchmark rates. lower late fee incidence, partially offset by the impacts of our product, pricing and policy changes.

Read it in 10-K 2026-02-06 at sec.gov ↗

RewordedMD&A
In addition to the seasonal variance in loan receivables discussed above, we also typically experience a seasonal increase in delinquency Delinquency rates and delinquent loan receivables balances during typically rise in the third and fourth quarters of each year due to lower as customer payment rates, rates decline, resulting in higher net charge-off rates in the first half of the calendar year.

Read it in 10-K 2026-02-06 at sec.gov ↗

RewordedMD&A
We believe that the payments we make to our partners under our retailer share arrangements, in the aggregate, in 2025 2026 will increase compared to the year ended December 31, 2024, primarily 2025, reflecting continued improvement in program performance, as a result of the impact of our product, pricing and policy changes and an expected reduction well as growth in net charge-offs. loan receivables.

Read it in 10-K 2026-02-06 at sec.gov ↗

RewordedMD&A
Other income decreased increased by $17 $39 million for the year ended December 31, 2024, 2025, primarily due to lower commission fees following the Pets Best disposition, partially offset by higher protection product revenue and the impact of product, pricing and policy change related fees. fees, partially offset by lower commission fees following the Pets Best disposition in the prior year.

Read it in 10-K 2026-02-06 at sec.gov ↗

RewordedMD&A
The These seasonal impact impacts to purchase volume and the our loan receivables balance typically results in fluctuations in balances may materially affect our results of operations, delinquency metrics and the allowance for credit losses as a percentage of total loan receivables with the most pronounced effects typically occurring between quarterly periods. the fourth quarter and the subsequent first quarter.

Read it in 10-K 2026-02-06 at sec.gov ↗

RewordedMD&A
We continue to expect to maintain capital ratios well in excess of minimum regulatory requirements and sufficient capital and liquidity resources to support our daily operations, our business growth, and our credit ratings as well as regulatory and compliance requirements in a cost effective and prudent manner through expected and unexpected market environments. ratings.

Read it in 10-K 2026-02-06 at sec.gov ↗

Quiet changesMD&A
Most of our program agreements with large retail and certain other digital partners contain retailer share arrangements that provide for payments to our partners if the economic performance of the program exceeds a contractually defined threshold.

Read it in 10-K 2026-02-06 at sec.gov ↗

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