Synchrony Financial - FORM 8-K - EX-99.1 - EXHIBIT 99.1

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8-K - 8-K - Synchrony Financial	a8-k4q1622317adb.htm

Exhibit 99.1



SYNCHRONY FINANCIAL
SELECTED METRICS⁽¹⁾
(unaudited, $ in millions)
	Quarter Ended																								Twelve Months Ended
	Dec 31, 2016			Sep 30, 2016			Jun 30, 2016			Mar 31, 2016			Dec 31, 2015			Sep 30, 2015			Jun 30, 2015			Mar 31, 2015			Dec 31, 2016			Dec 31, 2015			YTD'16 vs. YTD'15
SELECTED METRICS
Return on assets⁽²⁾	2.6		%	2.8		%	2.4		%	2.8		%	2.6		%	2.9		%	2.9		%	3.0		%	2.7		%	2.9		%			(0.2	)%
Return on equity⁽³⁾	16.2		%	17.3		%	14.5		%	18.1		%	17.3		%	19.0		%	19.1		%	20.7		%	16.5		%	19.0		%			(2.5	)%
Return on tangible common equity⁽⁴⁾	18.4		%	19.6		%	16.5		%	20.7		%	19.8		%	21.7		%	22.0		%	24.0		%	18.8		%	21.8		%			(3.0	)%
Net interest margin⁽⁵⁾	16.26		%	16.34		%	15.94		%	15.84		%	15.71		%	15.98		%	15.79		%	15.90		%	16.10		%	15.85		%			0.25	%
Other expense as a % of average loan receivables, including held for sale	5.04		%	4.93		%	5.07		%	4.86		%	5.31		%	5.37		%	5.39		%	5.10		%	4.98		%	5.29		%			(0.31	)%
Net charge-offs as a % of average loan receivables, including held for sale	4.65		%	4.39		%	4.51		%	4.74		%	4.25		%	4.03		%	4.64		%	4.56		%	4.57		%	4.36		%			0.21	%

Average loan receivables, including held for sale	$	72,476		$	69,316		$	66,561		$	66,194		$	64,996		$	62,281		$	59,895		$	59,380		$	68,649		$	61,655		$	6,994	11.3	%
Retail Card	$	49,476		$	47,274		$	45,593		$	45,479		$	44,620		$	42,779		$	41,201		$	40,662		$	46,963		$	42,327		$	4,636	11.0	%
Payment Solutions	$	15,076		$	14,367		$	13,554		$	13,430		$	13,129		$	12,478		$	11,904		$	11,931		$	14,110		$	12,364		$	1,746	14.1	%
CareCredit	$	7,924		$	7,675		$	7,414		$	7,285		$	7,247		$	7,024		$	6,790		$	6,787		$	7,576		$	6,964		$	612	8.8	%

(1) Average balances and selected metrics are now presented based upon the use of daily averages.
(2) Return on assets represents net earnings as a percentage of average total assets.
(3) Return on equity represents net earnings as a percentage of average total equity.
(4) Return on tangible common equity represents net earnings as a percentage of average tangible common equity. Tangible common equity ("TCE") is a non-GAAP measure. For corresponding reconciliation of TCE to the most directly comparable GAAP financial measure, see "Reconciliation of non-GAAP measure."
(5) Net interest margin represents net interest income divided by average interest-earning assets.



SYNCHRONY FINANCIAL
AVERAGE BALANCES, NET INTEREST INCOME AND NET INTEREST MARGIN⁽¹⁾
(unaudited, $ in millions)

	Quarter Ended
	Dec 31, 2016							Sep 30, 2016							Jun 30, 2016							Mar 31, 2016							Dec 31, 2015							Sep 30, 2015							Jun 30, 2015							Mar 31, 2015
				Interest		Average					Interest		Average					Interest		Average					Interest		Average					Interest		Average					Interest		Average					Interest		Average					Interest		Average
	Average			Income/		Yield/		Average			Income/		Yield/		Average			Income/		Yield/		Average			Income/		Yield/		Average			Income/		Yield/		Average			Income/		Yield/		Average			Income/		Yield/		Average			Income/		Yield/
	Balance			Expense		Rate		Balance			Expense		Rate		Balance			Expense		Rate		Balance			Expense		Rate		Balance			Expense		Rate		Balance			Expense		Rate		Balance			Expense		Rate		Balance			Expense		Rate
Assets
Interest-earning assets:
Interest-earning cash and equivalents	$	12,210		$	17	0.55	%	$	12,480		$	16	0.51	%	$	11,623		$	14	0.48	%	$	12,291		$	16	0.52	%	$	12,466		$	9	0.29	%	$	11,182		$	7	0.25	%	$	11,051		$	6	0.22	%	$	11,063		$	6	0.22	%
Securities available for sale	4,076			11		1.07	%	2,960			9		1.21	%	2,858			7		0.99	%	2,977			6		0.81	%	3,564			6		0.67	%	3,589			6		0.66	%	2,904			5		0.69	%	2,892			4		0.56	%

Loan receivables:
Credit cards, including held for sale	69,660			3,851		21.99	%	66,519			3,705		22.16	%	63,876			3,432		21.61	%	63,688			3,436		21.70	%	62,394			3,432		21.82	%	59,647			3,315		22.05	%	57,365			3,106		21.72	%	57,001			3,079		21.91	%
Consumer installment loans	1,373			31		8.98	%	1,333			31		9.25	%	1,233			28		9.13	%	1,154			27		9.41	%	1,163			26		8.87	%	1,161			27		9.23	%	1,099			26		9.49	%	1,053			25		9.63	%
Commercial credit products	1,386			36		10.33	%	1,401			35		9.94	%	1,388			33		9.56	%	1,313			35		10.72	%	1,384			36		10.32	%	1,411			36		10.12	%	1,392			34		9.80	%	1,303			36		11.20	%
Other	57			1		NM		63			—		—	%	64			1		NM		39			—		—	%	55			—		—	%	62			1		NM		39			—		—	%	23			—		—	%
Total loan receivables, including held for sale	72,476			3,919		21.51	%	69,316			3,771		21.64	%	66,561			3,494		21.11	%	66,194			3,498		21.25	%	64,996			3,494		21.33	%	62,281			3,379		21.52	%	59,895			3,166		21.20	%	59,380			3,140		21.45	%
Total interest-earning assets	88,762			3,947		17.69	%	84,756			3,796		17.82	%	81,042			3,515		17.44	%	81,462			3,520		17.38	%	81,026			3,509		17.18	%	77,052			3,392		17.47	%	73,850			3,177		17.26	%	73,335			3,150		17.42	%

Non-interest-earning assets:
Cash and due from banks	739							862							895							1,367							1,429							1,345							660							759
Allowance for loan losses	(4,228		)					(3,933		)					(3,732		)					(3,590		)					(3,433		)					(3,338		)					(3,305		)					(3,289		)
Other assets	3,479							3,189							3,208							3,271							3,077							2,833							2,592							2,602
Total non-interest-earning assets	(10		)					118							371							1,048							1,073							840							(53		)					72

Total assets	$	88,752						$	84,874						$	81,413						$	82,510						$	82,099						$	77,892						$	73,797						$	73,407

Liabilities
Interest-bearing liabilities:
Interest-bearing deposit accounts	$	51,006		$	188	1.47	%	$	47,895		$	188	1.56	%	$	45,523		$	179	1.58	%	$	44,304		$	172	1.56	%	$	42,316		$	165	1.55	%	$	39,125		$	159	1.61	%	$	35,687		$	146	1.64	%	$	35,017		$	137	1.59	%
Borrowings of consolidated securitization entities	12,389			64		2.06	%	12,254			63		2.05	%	12,211			59		1.94	%	12,860			58		1.81	%	13,443			56		1.65	%	13,604			54		1.57	%	14,002			53		1.52	%	13,998			52		1.51	%
Bank term loan⁽²⁾	—			—		—	%	—			—		—	%	65			7		NM		2,170			24		4.45	%	4,495			28		2.47	%	4,819			29		2.39	%	5,311			32		2.42	%	6,052			47		3.15	%
Senior unsecured notes	7,757			67		3.44	%	7,448			64		3.42	%	6,861			58		3.40	%	6,557			57		3.50	%	5,863			52		3.52	%	5,322			47		3.50	%	4,567			39		3.43	%	4,211			35		3.37	%
Related party debt	—			—		—	%	—			—		—	%	—			—		—	%	—			—		—	%	—			—		—	%	—			—		—	%	—			—		—	%	349			4		4.65	%
Total interest-bearing liabilities	71,152			319		1.78	%	67,597			315		1.85	%	64,660			303		1.88	%	65,891			311		1.90	%	66,117			301		1.81	%	62,870			289		1.82	%	59,567			270		1.82	%	59,627			275		1.87	%

Non-interest-bearing liabilities
Non-interest-bearing deposit accounts	176							204							208							235							151							156							256							247
Other liabilities	3,321							3,175							3,002							3,455							3,290							2,863							2,614							2,725
Total non-interest-bearing liabilities	3,497							3,379							3,210							3,690							3,441							3,019							2,870							2,972

Total liabilities	74,649							70,976							67,870							69,581							69,558							65,889							62,437							62,599

Equity
Total equity	14,103							13,898							13,543							12,929							12,541							12,003							11,360							10,808

Total liabilities and equity	$	88,752						$	84,874						$	81,413						$	82,510						$	82,099						$	77,892						$	73,797						$	73,407
Net interest income				$	3,628						$	3,481						$	3,212						$	3,209						$	3,208						$	3,103						$	2,907						$	2,875

Interest rate spread⁽³⁾						15.91	%						15.97	%						15.56	%						15.48	%						15.37	%						15.65	%						15.44	%						15.55	%
Net interest margin⁽⁴⁾						16.26	%						16.34	%						15.94	%						15.84	%						15.71	%						15.98	%						15.79	%						15.90	%

(1) Average balances and selected metrics are now presented based upon the use of daily averages.
(2) The effective interest rates for the Bank term loan for the quarters ended June 30, 2016, March 31, 2016, December 31, 2015, September 30, 2015, June 30, 2015, and March 31, 2015 were 2.51%, 2.47%, 2.26%, 2.23%, 2.21%, and 2.21% respectively. The Bank term loan effective rate excludes the impact of charges incurred in connection with prepayments of the loan.
(3) Interest rate spread represents the difference between the yield on total interest-earning assets and the rate on total interest-bearing liabilities.
(4) Net interest margin represents net interest income divided by average interest-earning assets.



SYNCHRONY FINANCIAL
AVERAGE BALANCES, NET INTEREST INCOME AND NET INTEREST MARGIN⁽¹⁾
(unaudited, $ in millions)

	Twelve Months Ended Dec 31, 2016							Twelve Months Ended Dec 31, 2015
				Interest		Average					Interest		Average
	Average			Income/		Yield/		Average			Income/		Yield/
	Balance			Expense		Rate		Balance			Expense		Rate
Assets
Interest-earning assets:
Interest-earning cash and equivalents	$	12,152		$	63	0.52	%	$	11,409		$	28	0.25	%
Securities available for sale	3,220			33		1.02	%	3,240			21		0.65	%

Loan receivables:
Credit cards, including held for sale	65,947			14,424		21.87	%	59,118			12,932		21.87	%
Consumer installment loans	1,274			117		9.18	%	1,119			104		9.29	%
Commercial credit products	1,372			139		10.13	%	1,373			142		10.34	%
Other	56			2		3.57	%	45			1		2.22	%
Total loan receivables, including held for sale	68,649			14,682		21.39	%	61,655			13,179		21.38	%
Total interest-earning assets	84,021			14,778		17.59	%	76,304			13,228		17.34	%

Non-interest-earning assets:
Cash and due from banks	965							1,086
Allowance for loan losses	(3,872		)					(3,341		)
Other assets	3,286							2,779
Total non-interest-earning assets	379							524

Total assets	$	84,400						$	76,828

Liabilities
Interest-bearing liabilities:
Interest-bearing deposit accounts	$	47,194		$	727	1.54	%	$	38,060		$	607	1.59	%
Borrowings of consolidated securitization entities	12,428			244		1.96	%	13,760			215		1.56	%
Bank term loan⁽²⁾	556			31		5.58	%	5,164			136		2.63	%
Senior unsecured notes	7,158			246		3.44	%	4,996			173		3.46	%
Related party debt	—			—		—	%	86			4		4.65	%
Total interest-bearing liabilities	67,336			1,248		1.85	%	62,066			1,135		1.83	%

Non-interest-bearing liabilities
Non-interest-bearing deposit accounts	205							202
Other liabilities	3,239							2,877
Total non-interest-bearing liabilities	3,444							3,079

Total liabilities	70,780							65,145

Equity
Total equity	13,620							11,683

Total liabilities and equity	$	84,400						$	76,828
Net interest income				$	13,530						$	12,093

Interest rate spread⁽³⁾						15.74	%						15.51	%
Net interest margin⁽⁴⁾						16.10	%						15.85	%

(1) Average balances and selected metrics are now presented based upon the use of daily averages.
(2) The effective interest rates for the Bank term loan for the 12 months ended December 31, 2016 and December 31, 2015 were 2.48% and 2.23%, respectively. The Bank term loan effective rate excludes the impact of charges incurred in connection with prepayments of the loan.
(3) Interest rate spread represents the difference between the yield on total interest-earning assets and the rate on total interest-bearing liabilities.
(4) Net interest margin represents net interest income divided by average interest-earning assets.



SYNCHRONY FINANCIAL
RECONCILIATION OF NON-GAAP MEASURE⁽¹⁾
(unaudited, $ in millions)
	Quarter Ended
	Dec 31, 2016			Sep 30, 2016			Jun 30, 2016			Mar 31, 2016			Dec 31, 2015			Sep 30, 2015			Jun 30, 2015			Mar 31, 2015
COMMON EQUITY MEASURES

GAAP Total common equity	$	14,196		$	13,981		$	13,715		$	13,204		$	12,604		$	12,158		$	11,578		$	11,036
Less: Goodwill	(949		)	(949		)	(949		)	(949		)	(949		)	(949		)	(949		)	(949		)
Less: Intangible assets, net	(712		)	(733		)	(704		)	(702		)	(701		)	(646		)	(575		)	(557		)
Tangible common equity	$	12,535		$	12,299		$	12,062		$	11,553		$	10,954		$	10,563		$	10,054		$	9,530

(1) Balances represent period-end balances.

Synchrony Financial - FORM 8-K - EX-99.1 - EXHIBIT 99.1 - February 23, 2017

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Synchrony Financial Reports